Tue. Sep 17th, 2019




Microsoft Acquiring Nokia Devices and Services Division for About $5 Billion USD

Nokia Lumia 925, Nokia Catwalk, WP8 Catwalk

Mind-blowing news straight out of Finland: Microsoft will pay Nokia 3.79 billion euros ($4.99 billion) for its devices and services business, including Nokia’s Asha range of phones. The acquisition will also include a payment of 1.65 billion EUR for patents.

Microsoft is betting that the acquisition will help speed up growth and improve marketshare for the already growing Windows Phone platform; Nokia is Windows Phone’s largest manufacturer.

“It’s a bold step into the future – a win-win for employees, shareholders and consumers of both companies. Bringing these great teams together will accelerate Microsoft’s share and profits in phones, and strengthen the overall opportunities for both Microsoft and our partners across our entire family of devices and services,” said Steve Ballmer, Microsoft chief executive officer. “In addition to their innovation and strength in phones at all price points, Nokia brings proven capability and talent in critical areas such as hardware design and engineering, supply chain and manufacturing management, and hardware sales, marketing and distribution.”

“Building on our successful partnership, we can now bring together the best of Microsoft’s software engineering with the best of Nokia’s product engineering, award-winning design, and global sales, marketing and manufacturing,” said Stephen Elop, who following today’s announcement is stepping aside as Nokia President and CEO to become Nokia Executive Vice President of Devices & Services. “With this combination of talented people, we have the opportunity to accelerate the current momentum and cutting-edge innovation of both our smart devices and mobile phone products.”

At closing, approximately 32,000 people are expected to transfer to Microsoft, including 4,700 people in Finland and 18,300 employees directly involved in manufacturing, assembly and packaging of products worldwide. The operations that are planned to be transferred to Microsoft generated an estimated EUR 14.9 billion, or almost 50 percent of Nokia’s net sales for the full year 2012.

Under the terms of the acquisition, Nokia will be granting Microsoft a 10-year non-exclusive license to its patents at the time of the closing, while Microsoft will grant Nokia reciprocal rights to use Microsoft patents in its HERE services. In addition, according to the press release, Nokia will grant Microsoft an option to extend this mutual patent agreement in perpetuity.

Needless to say, it’s a crazy time to be a Windows Phone fan, especially if you’ve been rooting for Nokia to get back in the game.