Nokia has confirmed it is acquiring the ailing French telecom company Alcatel-Lucent through a public exchange offer in France and the United States, in a bid to become a leading global networks operator.

The deal has been approved by each company’s board of directors and is expected to close in 2016 subject to regulatory and other approvals, the Finnish company said.

The announcement follows confirmation a day earlier that Nokia was in advanced talks to buy Alcatel-Lucent, which has been racking up billions of euros of losses since its creation in 2006.

The Finnish mobile communications company said the all-share transaction will be on the basis of 0.55 of a new Nokia share for every share of Alcatel-Lucent. The share offer values the French company at €15.6bn.

Alcatel-Lucent shareholders would own 33.5% of the fully diluted share capital of the combined company, with Nokia shareholders owning 66.5%.

Both companies’ chief executives, Nokia’s Rajeev Suri and Alcatel-Lucent’s Michel Combes, met with French President Francois Hollande briefly on Tuesday afternoon, and the French government said it would support the deal.

Nokia has recently made a turnaround since its €5.4bn sale of the loss-making handset business to Microsoft in 2013, with three remaining sectors: networks, mapping services and technologies, and patents.

Nokia also said Wednesday it has “initiated a review of strategic options, including a potential divestment, for its business.” No details were given.

Alcatel-Lucent, which has undergone repeated rounds of restructuring since the 2006 merger of France’s Alcatel and US-based Lucent Technologies, is laying off more than 10,000 workers and last year made a net loss of €118m.