Nokia completes sale of cellphone business to Microsoft

2014-04-26 10:09

Los Angeles – Finnish telecommunications group Nokia said it had completed the sale of “substantially all” of its handset business to the US software giant Microsoft.

The €5.44-billion (R80 billion) deal was unveiled in September, but Nokia said the price tag could be slightly higher based on final adjustments. It consists of €3.79 billion for Nokia’s devices and services divisions and €1.65 billion for its patents.

“Today, we welcome the Nokia Devices and Services business to our family. The mobile capabilities and assets they bring will advance our transformation,” said Microsoft chief executive Satya Nadella yesterday.

The completion of the deal comes eight months after the initial announcement. Since then, Nadella replaced Steve Ballmer as Microsoft chief executive.

Former Nokia president and chief executive Stephen Elop will serve as executive vice president of the Microsoft Devices Group, which includes Lumia smartphones and tablets, Nokia mobile phones, Xbox hardware and Surface tablets.

Nokia and Microsoft cleared a major hurdle this month when China’s Ministry of Commerce approved the transaction. Nokia was the world’s leading cellphone maker until smartphones from Apple as well as companies using Google’s Android operating system overtook it.

With the completion of the sale, Nokia will consist of the network infrastructure and services division NSN and the mapping services unit HERE. Nokia is due to present first-quarter results on Tuesday. Nokia said its plants in Chennai in India and Masan in South Korea would not be transferred to Microsoft.

The Chennai plant is subject to an asset freeze by Indian tax authorities over an ongoing dispute. The plant was to make mobile devices for Microsoft. Nokia plans to close the Masan plant, which has about 200 employees. Employees in Chennai and Masan were to be offered support if they wished to look for work outside Nokia, the group said.

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