Back in September, Nokia announced that Nokia will sale handset business division to Microsoft for $7.2 billion. And as expected, the deal is now completed. Nokia handset division is now part of Microsoft Mobile Oy. According to internal documents, it is reported that Nokia will be renamed as Microsoft Mobile Oy, a subsidiary of Microsoft.
Nokia was sold for $7.2 billion but now because of adjustments made for net working capital and cash earnings the deal is now worth more than that. In the deal, Nokia Chennai factory won’t be transferred to Microsoft because of tax battle with Indian authorities.
On the acquisition Nokia’s CEO Steven Elop said “At our core, we are passionate about building technology that will change the world. From the early vision of Microsoft of placing a PC in every home and on every desk, to Nokia connecting billions of people through mobile devices, we have empowered generations. But we could not have achieved any of this without our fans around the world.”
During the sale Nokia to Microsoft, Nokia signature tune Nokia Tune completed 20 years. Being Nostalgic Nokia posts the timeline and series of ads on Nokia Tune on its conversation blog.
Nokia in Press release confirms the deal
Nokia today announced that it has completed the sale of substantially all of its Devices & Services business to Microsoft.
The transaction, which also includes an agreement to license patents to Microsoft, was originally announced on September 3, 2013.
As earlier communicated, the transaction was subject to potential purchase price adjustments. The estimate of the adjustments made for net working capital and cash earnings was slightly positive for Nokia, and we currently expect the total transaction price to be slightly higher than the earlier-announced transaction price of EUR 5.44 billion after the final adjustments are made based on the verified closing balance sheet.
Additionally, as is customary for transactions of this size, scale and complexity, Nokia and Microsoft made certain adjustments to the scope of the assets originally planned to transfer. These adjustments included Nokia’s manufacturing facilities in Chennai in India and Masan in the Republic of Korea not transferring to Microsoft. These adjustments have no impact on the material deal terms of the transaction and Nokia will be materially compensated for any retained liabilities.
In India, our manufacturing facility is subject to an asset freeze by the Indian tax authorities as a result of ongoing tax proceedings. Consequently, the facility remains part of Nokia following the closing of the transaction. Nokia and Microsoft have entered into a service agreement whereby Nokia would produce mobile devices for Microsoft.
In Korea, Nokia and Microsoft agreed to exclude the Masan facility from the scope of the transaction. Nokia will now take steps to close the facility, which employs approximately 200 people.
As previously announced, the following Nokia leaders have stepped down from the Nokia Leadership Team and transferred to Microsoft at closing, effective April 25, 2014: Stephen Elop, Jo Harlow, Juha Putkiranta, Timo Toikkanen, and Chris Weber. Until further notice, Nokia’s interim governance model announced on September 3, 2013 is in place.
Nokia will further disclose the details about the transaction on April 29, 2014, Nokia will also disclose the Q1 2014 result on 29 April. Nokia will also reveal the fate of Nokia Chennai plant.
We at MakTechBlog are feeling very Nostalgic about this deal. Being a Nokian, i will always miss the original Nokia.
What do you think about this deal?