Tag Archives: Stephen Elop

Microsoft and Nokia complete mobile phone unit deal

yyMicrosoft has completed its purchase of Nokia’s mobile phone business for 5.44bn euros ($7.5bn; £4.5bn).

The deal between the two firms should have been completed earlier this year but it was delayed by a hold-up in regulatory approvals.

The sale will see the end of production of mobile phones by Nokia.

“Today we welcome the Nokia devices and services business to our family,” said Microsoft chief executive Satya Nadella.

“The mobile capabilities and assets they bring will advance our transformation.”

The Finnish company will now focus on networks, mapping services and technology development and licences.

Two Nokia plants will remain outside the deal – a manufacturing unit in Chennai, India, subject to an asset freeze by Indian tax authorities, and the Masan plant in South Korea, which it plans to shut down.

Former Nokia chief executive Stephen Elop has become executive vice president of the Microsoft devices group, in charge of Lumia smartphones and tablets, Nokia mobile phones, Xbox hardware, Microsoft Surface, and Perceptive Pixel (PPI) products

Nokia Microsoft mobile deal gets shareholder go ahead

Shareholders of the phonemaker Nokia have agreed to sell their mobile phone business to technology giant Microsoft for 5.4bn euros ($7.2 bn; £4.5bn).

The deal goes ahead despite objections from some investors who opposed the sale of a Finnish asset.

Regulators must clear the sale, but is expected to close early next year.

In September, Microsoft agreed to buy the mobile phone business and licence patents from Nokia.

Nokia has seen its share of the smartphone market shrink as competitors such as Apple and Samsung have risen in popularity.

‘Feels good’

Tuesday’s deal was approved by 99.5% of Nokia’s 3,900 investors at a meeting for shareholders in the Finnish capital of Helsinki.

At the five-hour-long shareholder meeting, Chairman Risto Siilasmaa said he believed the sale would “raise deep feelings” among Finns, who regard the phone company as a national success.

But one shareholder told the Reuters news agency he was happy with the vote.

“Now it feels good again. This is a really good result,” said Hannu Ryyppo. “It’s a new beginning for Nokia.”

When the sale was first announced, Nokia said it would also make changes to its leadership.

Stephen Elop, the former president chief executive of Nokia Corporation, was to step down and resign from the company’s board under the terms of the deal.

Nokia has faced criticism over the 18.8m euro pay-out Mr Elop is set to receive when he leaves the company. He is due to move over to Microsoft when the sale is completed.

Mr Elop left Microsoft to join Nokia in 2010, and has been cited by some as one of the frontrunners to replace Microsoft’s outgoing chief executive Steve Ballmer.

Mr Ballmer is expected to leave the company in 2014

Microsoft targets mobile phone unit as 7,800 more jobs go

Microsoft is shedding another 7,800 jobs as it reorganises its Nokia mobile phone unit.

The move represents a massive shift in strategy for Microsoft since it purchased Nokia’s mobile phone business for €5.44bn ($7.5bn; £4.5bn) last year.

Microsoft axed 18,000 jobs from the unit last July – the deepest cuts in the company’s history.

The technology giant will also write down the value of the Nokia deal by $7.6bn.

Microsoft currently has about 118,000 employees worldwide. A statement from the government in Finland, were Nokia is based, said the job losses would include some 2,300 posts in the country.

The statement said the government was “disappointed with Microsoft’s decision” and called a special ministerial meeting to consider assistance for those affected. “Loss of so many jobs is very sad for the whole society and for individuals affected,” it said.

Microsoft said in a statement that it would “restructure the company’s phone hardware business to better focus and align resources”.

Although still strong in the software market for personal computers, the company is faces strong competition in the fight to establish its mobile handset operation. This market is dominated by devices powered by Google’s Android system or Apple’s iOS.

A survey by research firm IDC said Microsoft’s Windows was expected to capture just 3.2% of the global smartphone market this year.

‘Reinvention’

In a memo to staff, the company’s chief executive Satya Nadella said: “I am committed to our first-party devices including phones. However, we need to focus our phone efforts in the near term while driving reinvention.

“We are moving from a strategy to grow a standalone phone business to a strategy to grow and create a vibrant Windows ecosystem that includes our first-party device family.”

Microsoft is due to start rolling out Windows 10 later this month, introducing a new operating system that can be used to power not only personal computers but a range of mobile devices.

Last month, Microsoft announced a shakeup of top management including the departure of Stephen Elop, the former Nokia chief who joined the US tech company as part of the acquisition

Analysis: Rory Cellan-Jones, BBC technology correspondent

Soon after the former Microsoft executive Stephen Elop became chief executive of Nokia, he wrote a memo to staff warning that the ailing company and its Symbian operating system was on a burning platform.

His solution was to jump on to another platform, the Windows Phone operating system, and eventually to sell the whole business to Microsoft. The alliance of the Windows Phone software with the Nokia hardware was supposed to create a powerful third force in the smartphone market, providing consumers with an attractive alternative to Android and Apple phones.

But now this platform too is burning, and Microsoft’s $7.3bn investment in Nokia along with its smartphone has gone up in flames. Stephen Elop has already left and now nearly 8,000 employees, many of them former Nokia staff, will follow him out of the business.

Microsoft says it will now change direction, creating an “ecosystem” which will see Windows phones built by other manufacturers alongside its own handsets.

The company which dominated the desktop computer era has never been a major force in mobile computing. Microsoft describes itself as “the leading platform and productivity company for the mobile-first, cloud-first world” – but that platform still needs some work.