Nokia’s $7.2 billion buyout by Microsoft Corp. has been delayed again due to impending approvals from regulatory authorities in Asia. Now it may complete in April.
It’s been more or less seven months when Nokia (NYSE: NOK) agreed to sell its Devices and Services business to Microsoft (NASDAQ: MSFT) for about $7.2 billion and expected to close the deal by the first quarter of 2014. During the time, the duo has faced lots of twists and turns, and couldn’t complete the transition thus far.
Now again, the deal has slipped to the next month i.e. April. The duo has briefed the ongoing process on Sunday. According a recent report, the European Commission and the US Department of Justice have already granted the Microsoft’s acquisition of Nokia, and they’re aligning “the closing conditions and integration planning.” However, some of the Asian regulatory authorities are still doing their evaluations, and they will have to wait for their assessments.
Our [Nokia] acquisition will accelerate our mobile-first, cloud-first imperatives. – Microsoft.
“We are nearing the final stages of our global regulatory approval process – to date we have received approvals from regulatory authorities in 15 markets on five continents,” said Brad Smith, General Counsel & Executive Vice President, Legal & Corporate Affairs, Microsoft. “Currently, we are awaiting approval confirmation in the final markets. This work has been progressing, and we expect to close next month, in April 2014.”
Furthermore, Nokia has touted again that there’s no impact of tax disputes in India on the transition as well as impending approvals in Asia. Earlier, Nokia was accused of unpaid sales taxes on devices made in India (the production house is located in Chennai, South India), although the company claimed those devices were exported, and weren’t manufactured in Chennai factory. According to insiders, if the tax dispute isn’t sorted out before the merger, the Chennai factory will be excluded from the transaction and will work as Microsoft’s contract manufacturer.
“Nokia and Microsoft continue to be confident that the transaction will close, resulting in the sale of substantially all of Nokia’s Devices & Services business to Microsoft, and both companies are working diligently to close the transaction as expeditiously as possible,” communicated Nokia in a press release.
The $7.2 billion buyout includes Nokia’s mobile phone business and the license to use Nokia’s portfolio of patents for 10 years, and as part of the deal, former Nokia CEO Stephen Elop will lead the acquired division at the helm of Microsoft.
Source: Microsoft | Nokia