Washington/Finland: It has finally happened. Nokia Corporation has announced that it has “signed an agreement to enter into a transaction” whereby it will “sell substantially all of its Devices & Services business and licence its patents to Microsoft for 5.44 billion euros in cash, payable at closing”. This will integrate the Microsofts Windows Phone operating system with its largest hardware vendor by far.

While the deal will make Microsoft a big time hardware player, Nokia will shift focus to technologies and software. “Following the transaction, Nokia plans to focus on its three established businesses, each of which is a leader in enabling mobility in its respective market segment: NSN, a leader in network infrastructure and services, HERE, a leader in mapping and location services, and Advanced Technologies, a leader in technology development and licensing,” a release said. 
At closing, this transaction is expected to strengthen Nokias financial position and provide a solid basis for future investment in these three businesses.

“After a thorough assessment of how to maximize shareholder value, including consideration of a variety of alternatives, we believe this transaction is the best path forward for Nokia and its shareholders,” said Risto Siilasmaa, Chairman of the Nokia Board of Directors and, following todays announcement, also Nokia interim CEO.

Nokia will retain its headquarters in Finland. “Today is an important moment of change and reinvention for Nokia and its employees,” said Nokia Chairman and interim CEO Siilasmaa. “With our strong corporate identity, leading assets and talent, and from a position of renewed financial strength, we will build Nokias next chapter.”

While Nokia is the top phone vendor in India, it is fourth in the smartphone market with just a 5 per cent market share.