NEW YORK (
(NOK) had hoped to finalize their smartphone deal by the end of the first quarter. Now both sides are saying that's not going to happen.
Both companies announced that finalization of the deal has been delayed by Asian regulators who need more time to approve Microsoft's acquisition of Nokia's device and services divisions. The deal already has received the blessing of U.S. and European regulators.
According to Microsoft's blog posting: "We have received approvals from regulatory authorities in 15 markets on five continents. Currently, we are awaiting approval confirmation in the final markets. This work has been progressing, and we expect to close next month, in April 2014".
Microsoft was advancing 0.72% to $40.45 and Nokia shares were up more than 1% to $7.25 in premarket trading.
In September 2013, Microsoft announced that it was acquiring Nokia's mobile device business in a deal worth $5.23 billion, along with another $2.28 billion to license Nokia's patents for 10 years. The deal totals nearly $7.5 billion.
During Microsoft's licensing of the brand, Nokia agreed not to use its name on smartphones or produce mobile devices under the Nokia name through the end of 2015. Microsoft acquired the rights to the Lumia (Windows Phone) and super-low cost Asha brands as part of the deal
At the time, then-Microsoft CEO Steve Ballmer called the deal a "bold step into the future" for both companies as a result of their ongoing Windows Phone manufacturing deal.
Nokia said it intends to focus on three core business units: the "Here" mapping service, Nokia Solutions and Networks, and the development and licensing of "advanced technologies." As part of the deal, Microsoft will license Here maps for four years.
A number of Nokia executives will join Microsoft. Stephen Elop has already switched to being the head of Microsoft's devices team. Risto Siilasmaa replaced Elop as Nokia's interim CEO.
To complicate matters, Nokia is currently battling two lawsuits in India's tax courts possibly complicating the transfer of the company's local manufacturing facilities to Microsoft. Nokia said those court proceedings have no bearing on the closing of the Microsoft transaction.
Last month, Nokia announced its line of smartphones to run on Google (GOOG) Android operating system. The phones called the Nokia X, X+ and XL are mid-priced smartphones which will initially run a specialized version of Android and will not offer apps, at least at the beginning, from the Google Play store.
Microsoft said it's still looking forward to completing the deal. It believes the 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."
-- Written by Gary Krakow in New York.
To submit a news tip, send an email to email@example.com.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV