US private equity groups KKR and TPG have backed away from bidding for a majority stake in Nokia Siemens Networks, leaving only one interested consortium in what has been a slow and cumbersome sale process for the ailing telecoms equipment company.

The US groups dropped out after failing to agree both on price and the level of control over the company that could be worth several billion dollars, several people close to the situation told the Financial Times.

The faltering talks have added to the uncertainty surrounding its Finnish part-owner Nokia as it struggles to stem an accelerating decline in its core mobile phone business.

The withdrawal of KKR and TPG came as Stephen Elop, Nokia’s chief executive, moved to counter a growing groundswell of opinion that the group’s plunging market value has made it a takeover target.

“All the rumours are baseless,” he said at a conference in London when asked if Nokia was for sale.

KKR’s and TPG’s loss of interest came after months of combing through NSN’s books and left another private equity duo, the Gores Group and Platinum Equity, as the remaining bidding consortium for the joint venture between Nokia and Germany’s Siemens.

Nokia, KKR and TPG all declined to comment on the status of the sales talks, which started last summer. Siemens said: “We continue to be in constructive talks with several interested parties.”

Analysts said Nokia’s crisis had meant management had not concentrated on the operational problems of NSN, which has lost €107m ($157m) in the first quarter as it continues to suffer from intensifying competition from Huawei and ZTE of China.

“If I was running Nokia, the last management distraction I would want would be having to deal with NSN,” said Ben Uglow, analyst at Morgan Stanley. “The most logical thing to do would be to dispose of it.”

In a recent interview, Mr Elop said Nokia was in no hurry to sell the 50-50 joint venture, highlighting synergies between the handset and network equipment businesses.

But Nokia’s reluctance to act has led to growing frustration within Siemens. “NSN is bigger than some Dax companies but it is being managed as if it was a simple division within Nokia,” said one Siemens manager.

Nokia owns a golden share in the joint venture and is represented on the board by four of the seven members.

The venture, with €12.7bn in revenues in its last year, remains one of the world’s biggest telecoms equipment makers after Ericsson of Sweden. But it has been losing money for much of the time since it was formed in 2007. It recently completed the $975m acquisition of network infrastructure assets from Motorola of the US.

Under their original agreement, Nokia and Siemens are both tied to NSN until 2013 unless they agree to a change in ownership structure. An initial public offering is viewed as one possible option for the business after the joint venture agreement comes to an end.

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