SummaryAvoid details on nature of �service agreement�
Finnish devices major Nokia on Friday officially announced that it has completed the sale of its devices and services business to Microsoft, excluding the Chennai plant (owing to tax disputes in various courts in India). Both companies in their respective statements have avoided mentioning the nature of the "service agreement", which they entered into for sourcing handsets from the Chennai plant.
Announcing the closure of the deal, a statement by Nokia said, �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."
The mobile major further said that as was customary for transactions of this size, scale and complexity, Nokia and Microsoft have made certain adjustments to the scope of the assets originally planned for transfer. These adjustments included Nokia's manufacturing facilities in Chennai in India and Masan in the Republic of Korea not being transferred to Microsoft. These adjustments have no impact on the material terms of the transaction.
On the Chennai facility, Nokia further said, "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."
Separately, Microsoft, while announcing the completion of the acquisition, said the factory in Chennai will stay with Nokia due to the tax liens on Nokia�s assets in India preventing transfer.
As part of the transaction, Microsoft will honour all existing Nokia customer warranties for existing devices, beginning April 25, 2014.
Workers take tough stance, say co can�t wash hands of responsibility
Chennai, April 25: Nokia India Thozhilalar Sangam (workers� union) on Friday asserted that the Finnish devices major cannot wash its hands of by just entering into a �service agreement� with Microsoft. Nokia India must ensure that the permanent employees continue to be employed on a long-term basis irrespective of whether it sources orders from Microsoft or others, said R Soundararajan, head of Centre of Indian Trade Unions (CITU), which is
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