Microsoft to Acquire Nokia's Devices & Services Business, License Nokia's Patents, Mapping Services for EUR 5.44B in Cash
Microsoft Corp. (NASDAQ: MSFT) and Nokia Corp. (NYSE: NOK) today announced that the boards of directors for 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 EUR 3.79 billion to purchase substantially all of Nokia's Devices & Services business, and EUR 1.65 billion to license Nokia's patents, for a total transaction cost of EUR 5.44 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.
Building on the partnership with Nokia announced in February 2011 and the increasing success of Nokia's Lumia smartphones, Microsoft aims to accelerate the growth of its share and profit in mobile devices through faster innovation, increased synergies, and unified branding and marketing.
Microsoft has published a document summarizing the strategic rationale for the agreement at http://www.microsoft.com/en-us/news/Press/2013/Sep13/StrategicRationale.aspx.
"It's a bold step into the