Nokia to sell its Mobile and Services division to Microsoft for $7.2 billion

Nokia has finally decided to sell its floundering mobile and services division and out of everyone the buyer of business is none other than Microsoft. The Finnish handset maker has had a tough time in the smartphone segment mainly owing to the success of Android and iOS with brands like Samsung and Apple taking the limelight. Investors, shareholders have been adamant that unless Nokia switches to Android platform, their business will struggle to survive in the current economy.

"Microsoft is acquiring Nokia's Smart Devices business unit, including the Lumia brand and products. Lumia handsets have won numerous awards and have grown in sales in each of the last three quarters, with sales reaching 7.4 million units in the second quarter of 2013," according to a released press statement.

Microsoft is also acquiring Nokia's Mobile Phones business unit, which serves hundreds of millions of customers worldwide, and had sales of 53.7 million units in the second quarter of 2013. Microsoft will acquire the Asha brand and will license the Nokia brand for use with current Nokia mobile phone products. Nokia will continue to own and manage the Nokia brand. 

In addition to the mobile business, Microsoft becomes the strategic licensee of the HERE platform, for which Nokia will be paid for four-year license. The total figure of $7.17 billion is spread across Nokia's devices and services business at $5 billion and the rest $2.17 billion for licensing Nokia's patents and mapping products.

The deal is expected to be completed by Q1 2014. This is the second major news in the mobile segment in the recent times. BlackBerry, another struggling mobile brand is also looking at option including sale for which the company has set up a committee to discuss the possibility.