Breaking: Microsoft Buys Nokia Devices Unit for $7.2 Billion


Microsoft and Nokia have just announced that both companies have decided to enter into a transaction whereby Microsoft will purchase substantially all of Nokia’s Devices & Services business, license Nokia’s patents, and license and use Nokia’s mapping services.

Under the terms of the agreement, Microsoft will pay $ 5 billion to purchase substantially all of Nokia’s Devices & Services business, and $ 2.2 billion to license Nokia’s patents, for a total transaction price of $ 7.2 billion in cash.

Microsoft will draw upon its overseas cash resources to fund the transaction. The transaction is expected to close in the first quarter of 2014, subject to approval by Nokia’s shareholders, regulatory approvals and other closing conditions.

“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.”

“We are excited and honored to be bringing Nokia’s incredible people, technologies and assets into our Microsoft family. Given our long partnership with Nokia and the many key Nokia leaders that are joining Microsoft, we anticipate a smooth transition and great execution,” Ballmer said. “With ongoing share growth and the synergies across marketing, branding and advertising, we expect this acquisition to be accretive to our adjusted earnings per share starting in FY15, and we see significant long-term revenue and profit opportunities for our shareholders.”

“For Nokia, this is an important moment of reinvention and from a position of financial strength, we can build our next chapter,” said Risto Siilasmaa, Chairman of the Nokia Board of Directors and, following today’s announcement, Nokia Interim CEO. “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.”

“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.”

Nokia has outlined its expected focus upon the closing of the transaction in a separate press release published today.

  • joinsaad

    Personally I think that this deal will not save both companies from having losses. They have already tried their combination and it did not work. NOKIA was already making good hardware. It is the problem of Software (MS Windows 8) which is a barrier in sales. After acquisition, I think the hardware quality of NOKIA will also reduce. Well again that is just my opinion.

    • Faizan Ali

      well this is a posibility, The other posibility is that microsoft follows the apple footsteps and design the hardware optimal for windows 8 which will boost the performance. The same was speculated when google bough Motorolla mobility but we are yet to hear from them

  • Faizan Ali

    this is just a copy paste from tech crunch!! I expect to see the original content from ProPakistani being the only tech blog in Pakistan with some resonable audience

    • A source would have been better.

      • aamir7

        Microsoft issued this statement, which we carried. Opinion and view point is going to follow up.

        • Faizan Ali

          yes you are right!! but it is left unclear in the article that wether this is the official statement from Microsoft or are the writer’s personal views

  • Saeed

    I don’t think its a good decision and my opinion is Nokia should adopt “Android” if they wanted to survive the company.

  • M Zubair Aslam

    is nokia going to die?

    • panjgoori

      they already died when Elop leaked that Memo and replaced Symbian and MeeGo with WP.

  • Faizan Ali

    down goes the cheap reliable nokia cellphones

  • Jkc

    ڈوبنے کو تنکے کا سہارا…

    • Malik

      Nokia’s chairpersons wil be thanking god for this kind of act of microsoft

  • Ahmad

    Ye to honaaaa heee thaaaa :P

  • sari to Microsoft ki statement ha to writer ne kya likha ha ?

  • Foqaan Shaikh

    So, we will never have Android on Nokia’s devices…. That’s sad news…