Published on September 3rd, 2013 | by Patrick Doyle0
Nokia’s Devices & Services Division To Be Acquired By Microsoft
Pending a Nokia shareholders meeting, Microsoft is looking to acquire Nokia’s Devices & Services Division from its Finnish parent.
The deal will give Microsoft access to Nokia’s hardware expertise as well as around 32,000 skilled employees. Microsoft will also have access to Nokia’s patents portfolio for 10 years, although there will be an option to extend that. The deal, all-in, is expected to cost Microsoft €5.44 billion.
Microsoft’s CEO Steve Balmer spoke of what acquiring Nokia can do for the company: “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.”
Risto Siilasmaa, who will now be appointed as Nokia’s interim CEO, said: “After a thorough assessment of how to maximize shareholder value, including consideration of a variety of alternatives, we believe this transaction is the best path forward for Nokia and its shareholders. Additionally, the deal offers future opportunities for many Nokia employees as part of a company with the strategy, financial resources and determination to succeed in the mobile space.”
Microsoft will acquire the Lumia and Asha brand names while Nokia will hold onto its own Nokia branding. Microsoft will also have access to Nokia’s licensing agreements, including its deal with telecommunications manufacturer Qualcomm.
Notably, Microsoft has made the shift from focusing on software-only products to hardware and integrated software in the last decade with its Xbox brand and, most recently, Windows Surface tablets. The Nokia deal follows that trend and could signify that the company is looking to make a very Apple-like approach to its mobile devices and make the hardware as well as the software.
SOURCE: Microsoft Press Release