Chennai: Nokia completed the sale of its handset business to software giant Microsoft, keeping the Chennai manufacturing plant, one of its largest facilities, out of the deal.
The Finnish handset maker expects the value of the transaction, which was completed after a month’s delay, to be slightly higher than the earlier annou-nced 5.44 billion euros (about $7.2 billion) after final adjustments based on the verified closing balance sheet, Nokia said.
Microsoft has announced that it will honour all existing Nokia customer warranties for existing devices, beginning April 25, 2014. It will absorb about 25,000 employees, who will be transferred globally from Nokia.
Nokia, in a statement, said that the Chennai manufacturing plant would manufacture devices for Microsoft.
“In India, our manufacturing facility is subject to an asset freeze by the Indian tax authorities as a result of ongoing tax proceedings. Consequently, the facility remains part of Nokia following the closing of the transaction. Nokia and Microsoft have entered into a service agreement whereby Nokia would produce mobile devices for Microsoft,” it said.
Nokia’s Chennai plant is one of its biggest phone-making factories employing around 8,000 people.
The deal also excludes Nokia’s plant in Masan, South Korea, which has about 200 employees and which will also be closed.
“Amid the uncertainty for our employees in Chennai and because of the planned closure of our facility in Masan, Nokia plans to offer a programme of support, including financial assistance, which would give our employees the chance to explore opportunities outside Nokia starting from a sound financial base.
“The company plans to bring to Chennai and Masan elements of its Bridge programme, which we have made available for employees affected by company changes in other sites,” the firm added.
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