The talk on Thursday was on a report that Nokia Corp. (NYSE: NOK) might like to buy Juniper Networks, Inc. (NYSE: JNPR) to boost its presence in computer networking.

The German business magazine Manager Magazin said Nokia is exploring an acquisition of Juniper to merge it with its Nokia Siemens Network division. A deal would let Nokia compete more effectively against Cisco Systems Inc. (NASDAQ: CSCO).

No deal has been announced. It’s not even clear a deal is coming, although Juniper shares were higher on Thursday. But it is true that Rajeev Suri, who heads Nokia Solutions and Networks, traveled to the United States late last year to discuss closer ties between Nokia and Juniper, if not an outright merger.

The immediate reaction Thursday was how Nokia might pay for Juniper, which has a market capitalization of some $13.7 billion. Nokia’s market cap is about $27 billion. Part of the acquisition could be financed using Juniper’s own cash. It has $3.1 billion on hand.

Plus, Nokia will have $7 billion or so after it sells its mobile phone business to Microsoft Corp. (NASDAQ: MSFT). In a deal worth, say, $17.1 billion (a 25% premium over Juniper’s current valuation), Nokia would have some $10 billion in hand. The rest, theoretically, could be financed with stock or a debt offering if investors believe a Nokia-Juniper combine really could compete.

The Cisco angle in all this deal talk comes up for two reasons.

First, Nokia wants to expand its business in China, now that Cisco is struggling in that market. The Chinese government reportedly blames Cisco for actively campaigning to block the efforts of Huawei Technology Co., Ltd., to market products to U.S. government agencies. So the government is making it harder for Cisco to win new business.

Second, Cisco has been struggling of late. Fiscal-second quarter earnings on a non-GAAP basis were $0.47 a share, down from $0.51 a year ago. Revenue was down 7.4% to $11.2 billion.

Nokia and Juniper have been partners in a number of projects, and some sort of combination makes sense. While Juniper shares were up 2.7% to $27.87, Nokia shares were up 0.3% to $7.29. The shares have risen 127% since bottoming last April. Thursday’s market reaction suggests investors don’t hate the idea of a deal. Cisco was up 0.5% to $22.35 and are up slightly on the year following a 14.2% gain in 2013.

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