September 3, 2013

Microsoft to buy Nokia mobile phone business

Nokia Lumia's smartphone, which runs Windows Phone 8.

Microsoft has agreed to pay 5.44 billion euros ($8 billion) for Nokia’s mobile phone business  as the Finnish company, once the biggest maker of mobile phones, struggles to maintain market share.

The deal includes paying 3.79 billion euros for the devices unit and 1.65 billion euros for patents, the companies said in a statement today.

Nokia chief executive Stephen Elop will step aside to return to Microsoft, they said.

Nokia is coping with cash-flow challenges stemming from weaker demand as its phones lose share to devices from Apple and handsets using Google’s Android operating system.

Mr Elop has cut more than 20,000 jobs and suspended the company’s dividend in January in an attempt to improve its finances.

Microsoft has battled to stay relevant as consumers have shifted from using its core Windows software for PCs toward mobile devices from Apple and others. Facebook and Google have also pushed ahead in social networking and online advertising, areas where Microsoft remains weak.

[via SMH]