Microsoft completed its acquisition of substantially all of Nokia’s Devices & Services business on April 25, 2014. The companies announced the proposed deal on September 3, 2013; the transaction agreement was dated September 2.
Which date counts as the acquisition?
April 25, 2014, is the closing date—the date Microsoft completed the acquisition. Microsoft’s financial reporting also treats April 25 as the acquisition date and includes the acquired operations in its results from then on. Microsoft’s FY2014 results identify the acquired business as substantially all of Nokia’s Devices & Services business.
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September 3, 2013, is the public announcement date. September 2 appears on the transaction agreement and in related filings. These dates describe different steps, not competing closing dates.
Microsoft–Nokia deal timeline
| Date | Event |
|---|---|
| Early 2013 | Microsoft approached Nokia about acquiring all or part of its Devices & Services business, according to Nokia’s account of the transaction process in its 2014 annual report. |
| September 2, 2013 | The Stock and Asset Purchase Agreement was dated. The transaction filing records this date. |
| September 3, 2013 | Microsoft and Nokia publicly announced the proposed transaction. Nokia’s 2014 annual report dates the announcement to September 3. |
| Late 2013 to early 2014 | The deal proceeded through shareholder and regulatory approval processes. |
| April 21, 2014 | Microsoft announced that the transaction would officially close on April 25. Microsoft’s closing-date announcement also described adjustments made before completion. |
| April 25, 2014 | The acquisition closed. Microsoft began reporting the acquired operations in its Phone Hardware segment from that date. |
What Microsoft acquired—and what Nokia kept
The deal covered substantially all of Nokia’s Devices & Services business, including its Mobile Phones and Smart Devices operations and related design, production, sales, marketing, and support activities. It also included a patent-licensing arrangement and licensing of Nokia mapping services. The transaction did not transfer Nokia’s entire patent portfolio or acquire HERE as a standalone business. The SEC-filed transaction announcement describes the deal’s scope and licensing terms.
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Microsoft did not buy Nokia Corporation as a whole. Nokia retained its broader corporate identity and businesses outside the transferred phone operation, including Nokia Networks, HERE mapping, and Nokia Technologies and much of its patent and research activity. Nokia’s 2014 annual report describes the post-transaction business structure. “Microsoft acquired Nokia” is common shorthand, but “Microsoft acquired substantially all of Nokia’s Devices & Services business” is more precise.
How much was the transaction worth?
The original announced value was €5.44 billion in cash: €3.79 billion for the Devices & Services business and €1.65 billion for the patent license, according to the transaction announcement filed with the SEC. Nokia said at closing that working-capital and cash-earnings adjustments were expected to make the final amount slightly higher, so €5.44 billion is the original announced figure, not an assertion of the final adjusted consideration. Nokia’s closing announcement explains the expected adjustment.
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Contemporary descriptions often rounded the total to “$7.2 billion.” That is a dollar conversion of the euro-denominated deal, not the original contract amount.
Why did completion take until April 2014?
The September 2013 announcement described a proposed transaction, not an immediate transfer. Completion depended on Nokia shareholder approval, regulatory approvals in multiple jurisdictions, customary closing conditions, and final adjustments to the operations and transaction economics. Microsoft said shareholder and governmental regulatory approvals had been received by the time the acquisition closed; its completion announcement welcomed the business on April 25.
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What changed at Microsoft after closing?
Microsoft placed the acquired phone operations in its Phone Hardware segment. Nokia chief executive Stephen Elop moved to Microsoft at closing and became executive vice president of Microsoft’s Devices Group, which included Lumia smartphones, Nokia mobile phones, Surface, Xbox hardware, and related devices and accessories. Microsoft outlined Elop’s role in its completion announcement; the company’s 2014 annual report identifies Phone Hardware as the reporting segment.
Microsoft’s strategic rationale was to bring phone hardware and software closer together and build on Nokia’s role as a leading Windows Phone hardware partner. The acquired operation brought Lumia and feature-phone products, manufacturing capabilities, and related personnel into Microsoft. Those were the aims and assets of the transaction; they do not, by themselves, establish how successful the strategy proved to be.
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