Microsoft has announced plans that it will take over Nokia handsets and services as well as license the patents in a $7.2 billion deal . The transaction is expected to take place in the first quarter of 2014 after shareholders approval, and will be paid in cash. The cost of buying the devices and services division is $5 billion and $2.2 billion to license the patents.
Microsoft published an email from CEO Steve Balmer to company employees cementing the acquisition “”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.”
In its release, Microsoft said the target was to increase its shares and profits in the mobile market through ‘through faster innovation, increased synergies and unified branding and marketing’. Nokia, said that the deal will give financial impetus to the company and avenues to reinvent. Microsoft entered into partnership with Nokia in 2011, the-then mobile leader adopted the Windows Operating System in their smartphones. Two of the phones Lumia 920 and Lumia 1020 did exceedingly well.