Microsoft's (NASDAQ:MSFT) $7.5 billion deal to buy Nokia's (NYSE:NOK) devices and services business and license its patents is now expected to close in April, later than the companies had hoped. The companies said regulators in Asia still need to approve the deal.
Both companies had expected the deal to close in the first quarter, which ends in one week. The deal has so far received approvals from regulatory authorities in 15 markets on five continents, according to Brad Smith, Microsoft's general counsel.
"The completion of this acquisition will mark the first step to bring Microsoft and the Nokia Devices and Services business together," Smith wrote in a company blog post. "Our acquisition will accelerate our mobile-first, cloud-first imperatives. We're looking forward to accelerating innovation and market adoption for Windows Phones and introducing the next billion customers to Microsoft services via Nokia mobile phones."
It's unclear which markets Nokia and Microsoft are facing hurdles in. However, earlier this month Bloomberg reported that Google (NASDAQ:GOOG) and Samsung Electronics were prodding Chinese regulators to ensure that once the deal closes they would not be forced to pay higher patent-licensing fees. Chinese handset vendors Huawei and ZTE, which rely heavily on Google's Android platform for their smartphone sales, also asked for similar conditions, according to the report, which cited unnamed sources.
The European Commission and U.S. Department of Justice approved the deal in December.
Nokia said in a statement that an ongoing tax dispute in India will not impact the closing or material terms of the deal. The Indian government hit Nokia last week with a new $414 million tax claim, which Nokia said was "absurd" and "completely without merit," according to Reuters. That came after the Indian Supreme Court issued a decision ordering Nokia to give a $571 million guarantee for paying future tax claims before transferring its Chennai factory to Microsoft.
The delay also likely means that the transaction will not close before Microsoft's Build developer conference, which starts April 2 in San Francisco. At the conference Microsoft is likely going to unveil the next version of its Windows Phone software, Windows Phone 8.1. Additionally, according to My Nokia Blog, which did not cite its sources, Nokia is expected to debut two new Windows Phones at the conference, the high-end Lumia 930 and the mid-range Lumia 630.
For more:
- see this Microsoft blog post
- see this Nokia statement
- see this Reuters article
- see this Bloomberg article
- see this WSJ article (sub. req.)
Related Articles:
Report: Microsoft's Nadella wants company to be full of 'challengers'
Report: Google, Samsung press China on conditions for Microsoft/Nokia deal
Report: Microsoft to waive Windows Phone license fees for Indian vendors
Report: Microsoft's Nadella, Gates and others initially opposed Nokia deal
Nokia exec: Android-based X phones fill a gap in our portfolio
Nokia unveils X, X+ and XL Android-based phones to draw users to Microsoft services
Microsoft adds Lenovo, LG, Foxconn to list of Windows Phone supporters