Nokia shareholders have put a seal of approval on the pending Microsoft
acquisition of the “Devices and Services” phone business of the Finnish
company. The stockholders gave the deal the green light in an
extraordinary general meeting at the Helsinki Ice Hall today. Microsoft
has earlier extended a $7.2 billion (€5.4 billion) offer to purchase
Nokia and an overwhelming 99.7% of the shareholders voted in favor of
the acquisition.
If the acquisition passes the final step of
regulatory approval, Microsoft will own the Lumia and Asha brands, as
well as get access to the Nokia brand. Here is where it gets complicated
as Nokia itself will be prohibited from entering back the phone market
with its own brand until 2016. After the first half of 2016, Nokia could
also start licensing its brand to third parties, so we theoretically we
could end up with three companies making Nokia branded phones in late
2016. Theoretically. Actually, Microsoft has agreed to pay some $2.23
billion of the total $7.2 billion acquisition price just for a 10-year
non-exclusive right to Nokia's smartphone patents and Here maps. Plus,
Microsoft can further extend that licence.
Second, current Nokia
CEO Stephen Elop will depart the company and rejoin its former employer
of Microsoft. Speculations are running wild over who will be the next
Microsoft CEO and Elop is allegedly among the top two candidates along
with Ford chief executive Alan Mulally.
Overall, though, we are
yet to hear what’s Microsoft exact plan for Nokia and how will it
integrate the Lumia and Asha series in its current lineup.
Microsoft
is said to have entered serious negotiations over the massive deal back
in February at the Mobile World Congress where the chief executives of
the two companies conceded that their cooperation did not bring the
results they have hoped for. Since then, Nokia’s board is set to have
discussed the acquisition proposal dozens of times.
"Subject
to the deal with Microsoft closing, Nokia's earnings profile and
financial position are expected to strengthen significantly,"
Nokia CFO Timo Ihamuotila commented on the deal at the company’s last
earnings call. Indeed, Nokia’s NSN and HERE divisions are the two
profitable divisions of the company while its previously legendary phone
division has been in the red for the last few quarters since the
Windows Phone transition began.
source: Financial Times (paywall) via TheVerge
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11/19/2013
Nokia shareholders okay Microsoft deal
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