Nokia – MS Deal has received regulatory approval from China

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The Nokia – Microsoft deal was soundless for quite some time due to the long regulatory approval process in major markets. This deal was expected to close in the first quarter of 2014 however, the companies has extended the timeline to end of April since it has not received approval from few more countries including India. Recently, the two companies got a “go-ahead” from the European and American regulators among others and at the moment, Nokia’s Devices & Services business to Microsoft has received regulatory approval from China.

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Nokia’s share has reportedly rose 2.9% to 5.48 Euros after the approval was announced.

As a phone maker, Nokia has paid rivals for the use of their technology licenses as well as charging for its own. Analyst confirms that a newly restructured Nokia would be freer to push up those fees. Also, with Microsoft waiving the license fee to two Indian Phone makers might further increase the market share confirms the analyst.

Google and Samsung had requested Chinese regulators to ensure that the deal with Microsoft would not lead to higher licensing fees, according to media reports. But Nokia said that it had not been accused of unfair practices regarding its patents.

“The regulatory approval process has involved a thorough review of Nokia’s patent licensing practices by several competition authorities around the world. During that process, no authority has challenged Nokia’s compliance with its FRAND undertakings related to standard-essential patents (licensing on fair, reasonable and non-discriminatory terms) or requested that Nokia make changes to its licensing program or royalty terms,” Nokia confirmed.

The approval is still pending with India now. Nokia is also involved in a tax case in India related to its manufacturing plant in Chennai. However, the company has confirmed that the case won’t affect the sale of its handset business to Microsoft.

Click Here to view the press release from Nokia.

The Nokia Microsoft deal would be a promising source of future growth for both the companies. Lets wait till end of April.

-Parasaran

 

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