Something that may not seem to unexpected happened earlier today, Microsoft acquired Nokia’s Devices and Services business, including both a license to Nokia’s patents and the use of Nokia’s mapping services, which they will use to control the Lumia brand and products as well as Nokia’s feature phones and Asha line-up.
Both boards of the two companies has already agreed to Microsoft’s €3.79 billion ($4.99 billion) purchase of the company as well as the €1.65 billion ($2.18 billion) price for the patents, bringing the grand total up to €5.44 billion ($7.17 billion).
A deal which will be funded with overseas cash and is expected to close in Q1 2013 after Nokia’s shareholders and regulators have approved of it.
Steve Ballmer, CEO of Microsoft said the following about the acquisition:
“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.”
As part of he deal, Nokia’s CEO Stephen Elop will now become Nokia’s executive vice president of devices and services, leading Microsoft’s new device unit once the deal has been completed, in the meantime Risto Siilasmaa has been named Nokia’s Interim CEO.
Nokia will however stick around, focusing on its network infrastructure, HERE Maps and Advanced Technologies.
In a joint letter Microsoft CEO Steve Ballmer and Nokia’s Stephen Elop wrote, “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,”
“With the commitment and resources of Microsoft to take Nokia’s devices and services forward, we can now realize the full potential of the Windows ecosystem, providing the most compelling experiences for people at home, at work and everywhere in between.”
“As a result of the acquisition, approximately 32,000 people are expected to be transferred from Nokia to Microsoft, “including 4,700 people in Finland and 18,300 employees directly involved in manufacturing, assembly and packaging of products worldwide.”
With Ballmer finishing off the statement with the following:
“We are very excited about the proposal to bring the best mobile device efforts of Microsoft and Nokia together,”
“Our Windows Phone partnership over the past two and half years has yielded incredible work – the stunning Lumia 1020 is a great example. Our partnership has also yielded incredible growth. In fact, Nokia Windows Phones are the fastest-growing phones in the smartphone market.”