Nokia shareholders vote to approve $US7.2 billion Microsoft deal

Nokia shareholders have voted in favour of a deal that will see Microsoft purchase the company’s mobile phone, smartphone and mobile services businesses.

In September, Microsoft announced it was buying Nokia for $US7.2 billion, after Nokia announced its smartphone sales slumped 27% year-on-year during the second quarter of 2013, with an overall loss of €115 million ($A190 million) for the quarter.

The sales plunge was led by the company’s Windows Phone-based Lumia smartphone unit, where unit shipments fell 27% from 10.2 million units during the second quarter of 2012 to just 7.4 million for the same quarter in 2013.

Under the deal, Nokia will retain its Nokia-Siemens services network equipment business along with the Nokia brand name, and will restrict it from competing against Microsoft in the mobile phone market.

The transaction is likely to close during the first quarter of 2014, subject to regulatory approval.

“This is a significant step forward for Nokia. We are delighted that shareholders have given us overwhelmingly strong support to proceed with this transformative agreement,” Nokia interim chief executive Risto Siilasmaa says.

“Today’s vote brings us closer to completing a transaction which will mark the beginning of the next chapter in Nokia’s near 150-year history, offering the potential of greater value for shareholders.”

Outspoken former Nokia executive and telecommunications industry analyst Tomi Ahonen remains pessimistic about Microsoft’s chances in the smartphone market.

“Congratulations Microsoft for picking up Nokia’s huge handset business at a bargain price. It is a poisoned chalice however, as under Microsoft ownership, the smartphone business will never turn into anything worth keeping at Microsoft.

“The Lumia/Windows Phone business unit will at some point be closed down at Microsoft after enough money is thrown into that endless pit.”

Ahonen remains a vocal critic of former Nokia chief executive Stephen Elop, who saw the company adopting the Windows Phone operating system.

“I will soon release my book on the Elop Effect, it needs to be recorded for history as the biggest management failure of any global market leader in economic history of humankind.”


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