Mobile telecoms equipment joint venture Nokia Siemens Networks is to sell its optical fibre unit to Marlin Equity Partners.
The company told Reuters that the fibre business is not really core to what it does these days.
Over 1,900 employees, mainly in Germany and Portugal, will be transferred to the new company.
It is the latest sell off by Nokia Siemens since last year, when it sold a number of product lines and announced plans to divest non-core assets and cut 17,000 jobs, nearly a quarter of its total workforce.
It is fairly likely that there will be other sell offs from the join venture. In fact this one was considered the least necessary. Nokia Siemens needed some optical technology for its main mobile broadband business.
The rumour is that if Nokia Siemens is preparing to sell this much of the family silver the company is preparing itself for further consolidation in the sector by cutting overlaps with other players.
Analyst house Ovum's Network Infrastructure Telecoms practice leader, Dana Cooperson, commented: "The details of the transaction were not released, so it is difficult to gauge Marlin's commitment to turning the optical business around. Competition in the market is keen; margins are under constant pressure. Competitors will take advantage of this ownership change and related confusion to gain any advantage in NSN's accounts. Marlin's goal may be to sell the optical business to another vendor, for example Juniper Networks. "