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Stephen Elop CEO of Nokia, left, with CEO of Microsoft Steve Ballmer in 2011. AP Photo/Alastair Grant, File
Smartphones
Microsoft to buy Nokia phones division and patents for €5.4 billion
Nokia shares surged as it was announced Microsoft will acquire their smartphone division, as well as important patents.
MICROSOFT IS TO purchase the handset division of phone giant Nokia, as the company again attempts to crack the smartphone market.
The $7.2 billion (€5.4 billion) deal is a big step in Microsoft’s attempts to recreate itself into a more versatile internet company, as opposed to a software manufacturer.
Microsoft has dominated the PC market for nearly 30 years, but with demand for desktop computing shrinking, the company is being forced to evolve.
The two companies have been in partnership since 2011, when it was agreed to carry Microsoft’s Windows software on Nokia’s Lumia handsets.
The Lumia has, however, remained a distant third to Apple’s iPhone and Android devices such as Samsung’s Galaxy handset.
“It’s a bold step into the future — a win-win for employees, shareholders and consumers of both companies,” Microsoft CEO Steve Ballmer said in a statement.
Ballmer announced just 10 days ago that he would be stepping down. The move has sparked speculation that Nokia CEO Stephon Elop, who is a former Microsoft executive, would succeed Ballmer.
The move will see Microsoft take on some 32,000 Nokia employees, as well as Nokia patents.
The news has seen Nokia’s share price jump over 40 per cent in early trading.
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