Microsoft acquires Nokia devices, services and all its patents

(L-R) Nokia CEO Stephen Elop and Microsoft CEO Steve Ballmer

Newscast Media REDMOND—Microsoft Corporation and Nokia Corporation today
announced that the Boards of Directors for both companies have decided to enter
into a transaction whereby Microsoft will purchase substantially all of Nokia’s Devices
& Services business, license Nokia’s patents, and license and use Nokia’s mapping

Under the terms of the agreement, Microsoft will pay EUR 3.79 billion ($5 billion) to
purchase substantially all of Nokia’s Devices & Services business, and EUR 1.65 ($2
billion) billion to license Nokia’s patents, for a total transaction price of EUR 5.44
billion ($7.2 billion) in cash. Microsoft will draw upon its overseas cash resources to
fund the transaction. The transaction is expected to close in the first quarter of
2014, subject to approval by Nokia’s shareholders, regulatory approvals and other
closing conditions.

“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,” said
Steve Ballmer, Microsoft chief executive officer. “In addition to their innovation and
strength in phones at all price points, Nokia brings proven capability and talent in
critical areas such as hardware design and engineering, supply chain and
manufacturing management, and hardware sales, marketing and distribution.”

As part of the transaction, Nokia is assigning to Microsoft its long-term patent
licensing agreement with Qualcomm, as well as other licensing agreements.

Microsoft is also acquiring Nokia’s Mobile Phones business unit, which serves hundreds
of millions of customers worldwide, and had sales of 53.7 million units in the second
quarter of 2013. Microsoft will acquire the Asha brand and will license the Nokia brand
for use with current Nokia mobile phone products. Nokia will continue to own and
manage the Nokia brand.