Microsoft buys part of Nokia for $7.2 billion

Microsoft have announced that it is acquiring Nokia’s devices and services side of the business as well as their licensed patents and mapping services for $7.2 billion.

With this deal Microsoft aims to increase their share and profits in the mobile device market, trying to close the gap on iPhone and Android. Nokia have also said the deal will strengthen the company financially and give them the opportunity to reinvent themselves.

CEO of Microsoft Steve Ballmer said,

“Our Windows Phone partnership over the past two and half years has yielded incredible work - the stunning Lumia 1020 is a great example. Our partnership has also yielded incredible growth. In fact, Nokia Windows Phones are the fastest-growing phones in the smartphone market.”

Microsoft joined up the Nokia in 2011, where they adopted Windows Phone operating system as its primary smartphone strategy. With this they produced a range of smartphones such as the Lumia 1020 and the Lumia 920.

Microsoft will pay $5 billion to buy the devices and services department and $2.2 billion to take control of the licensed patents.

The transaction is expected to be completed at the first part of 2014 pending approval from Nokia’s shareholders and will be paid for in cash.