Campaign India Team
Sep 03, 2013

Microsoft to buy Nokia's device and services businesses; branding to remain intact

GLOBAL- Nokia and Microsoft have announced a €5.44 billion (US$7.18 billion) deal by which Microsoft will purchase "substantially all" of Nokia's devices and services businesses and license its patents, although Nokia's brand will live on through a licensing arrangement.

Microsoft to buy Nokia's device and services businesses; branding to remain intact

According to the companies, Microsoft has agreed to a 10-year license arrangement under which it will use the Nokia brand on current mobile phones, but "Nokia will continue to own and maintain the Nokia brand".

Furthermore, Microsoft has agreed to a 10-year license arrangement to use the Nokia brand on current and subsequently developed products based on the Series 30 and Series 40 operating systems. Nokia will be restricted from licensing the Nokia brand for use in connection with mobile device sales for 30 months after the deal closes and from using the Nokia brand on its own mobile devices until December 31, 2015. Details are available here

Following the transaction, which the companies expect to close in Q1 of 2014, Nokia plans to focus on three businesses: NSN (network infrastructure and services), HERE (mapping and location services) and Advanced Technologies (technology development and licensing).

Microsoft will acquire Nokia's Mobile Phones and Smart Devices business units, as well as a design team, operations including all Nokia Devices & Services production facilities, Devices & Services-related sales and marketing activities, and related support functions.

Approximately 32,000 people are expected to transfer to Microsoft.

The operations that are planned to be transferred to Microsoft generated an estimated €14.9 billion, or almost 50 per cent, of Nokia's net sales for the full year 2012, according to Nokia.

The article first appeared on www.campaignasia.com

Source:
Campaign India