Andre Yoskowitz
2 Sep 2013 23:37
In a huge move for both companies, Microsoft has announced they have acquired Nokia's Devices & Services business, will license and use Nokia's patents and will also license and use Nokia's mapping services.
The software giant will pay $5 billion for the mobile phone division, and $2.17 billion for the patent trove. The company says the transaction will close in the Q1 2014, pending approval by shareholders and regulatory approval.
Microsoft is making a large, bold investment in the future of Windows Phone, expanding their partnership with Nokia from early 2011 that saw the start of the Lumia brand of smartphones. Microsoft is looking to "accelerate the growth of its share and profit in mobile devices through faster innovation, increased synergies, and unified branding and marketing."
Adds departing Microsoft CEO Steve Ballmer: "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. 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. 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."
Nokia's current CEO, Stephen Elop, will become Nokia Executive Vice President of Devices & Services, working for Microsoft.