Microsoft's Nokia buy suffers delay
Microsoft says that the completion of the purchase of Nokia's handset business will be delayed until the end of April.
The Redmond giant's buyout of Nokia's devices and services group was first announced in September 2013. Set to go ahead for $5 billion, with roughly $2.17 billion spent on licensing Nokia patents, Microsoft will not only acquire Nokia's handset-making business once the deal is finalized, but will also be able to use the firm's patents and mapping services.
Originally, Microsoft said "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." However, the end of March is just around the corner, and regulatory issues make the self-imposed deadline very unlikely to be upheld. As a result, and of no doubt interest to shareholders, statements from both Nokia and Microsoft say that the deal is most likely to be completed by the end of April.
In a blog post, Brad Smith, general counsel & executive vice president of Legal & Corporate Affairs at Microsoft said:
"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. Currently, we are awaiting approval confirmation in the final markets."
Finnish firm Nokia also revealed in a statement:
"Nokia and Microsoft have already received most of the required regulatory approvals, including approvals from the European Commission and the U.S. Department of Justice.
Furthermore, Nokia and Microsoft continue to make good progress related to the closing conditions and integration planning. However, the transaction is pending approvals from certain antitrust authorities in Asia which are still conducting their reviews."
Nokia took the opportunity to deny that ongoing tax investigations in India had any bearing on the deal's delay to be finalized. The handset maker is currently appealing against a tax bill the company labels "absurd," a notice for $414 million in unpaid duties issued by the Indian state of Tamil Nadu.
The local Indian government says that Nokia devices produced within its Chennai plant were sold within India instead of being exported, and therefore the handset maker is not exempt from the tax demand. Nokia has filed a writ to the Madras High Court in appeal, stating the claim is "completely without merit and counter to domestic tax laws."