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Microsoft Buys Nokia’s Devices and Services Divisions in $7.2 Billion Acquisition

Microsoft Buys Nokia’s Devices and Services Divisions in $7.2 Billion Acquisition

Microsoft announced on Tuesday that they are buying Nokia’s devices and services divisions. Nokia has been the main maker of Windows Phone 8 devices. The purchase is expected to close the first quarter of 2014 and will net Nokia EUR 5.44 billion (USD $7.2 billion).

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9to5Mac:

In a joint statement from (outgoing) Microsoft CEO Steve Ballmer and Nokia CEO Stephen Elop, the two executives stated, “Today’s agreement will accelerate the momentum of Nokia’s devices and services, bringing the world’s most innovative smartphones to more people, while continuing to connect the next billion people with Nokia’s mobile phone portfolio.”

“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.”

Microsoft is not taking Nokia over completely. Nokia will still be its own entity, holding a considerable patent portfolio. Microsoft will be granted a 10-year license to Nokia’s patents as part of the deal.

Microsoft is acquiring Nokia’s Smart Devices business unit, which includes the Lumia brand and products.

The operations that are planned to be transferred to Microsoft generated almost 50% of Nokia’s net sales for the full year 2012.

When the deal is complete, it is expected that 32,000 people are expected to transfer to Microsoft. That includes 4,700 employees in Finland, and 18,300 people worldwide that are involved in manufacturing, assembly, and packaging of product.

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