10/21/2014

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Business

Nokia shareholders set to back Microsoft deal

Nokia shareholders set to back Microsoft deal
Chairman of the Board of Directors and interim CEO of Nokia Risto Siilasmaa speaks at the Extraordinary General Meeting (EGM) of Nokia Corporation, Tuesday, Nov. 19, 2013 at the Helsinki Ice Hall, Helsinki, Finland.
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HELSINKI (AP) - Nokia shareholders looked set Tuesday to approve the sale of the ailing cellphone division and a portfolio of patents and services to Microsoft Corp. for 5.4 billion euros ($7.2 billion).

Hundreds of shareholders braved cold, November rain in the Finnish capital to attend the much-anticipated, extraordinary meeting called by the mobile phone maker that once dominated the market. However, it's seen its global share shrink as it battles stiff competition from Apple and Google Inc. in the lucrative smartphone trade.

The planned sale to Microsoft was widely expected to be approved as the company's share price has more than doubled since the September announcement of the deal, closing at 6 euros on Monday. In afternoon trading after the meeting opened, its stock was trading slightly down at 5.95 euros.

Nokia said more than 99 percent of participants were in favor of the deal in a pre-vote, representing some 45 percent of all votes and 78 percent of the 3,200 shareholders at the meeting being held in the Ice Hall - one of Helsinki's main hockey arenas.

Chairman Risto Siilasmaa said he was aware that the sale "would raise deep feelings" among Finns for whom Nokia has become a symbol of the small Nordic country's success. But, he added, it was the best deal for the company and the best offer for the loss-making devices unit.

In the third quarter, Nokia's handset sales continued to plunge with a net loss of 91 million euros. Although that was an improvement from a 969 million euros loss a year earlier, revenue dropped more than 20 percent to 5.6 billion euros in the quarter.

Finns have watched in despair as the company, named after the southern town of Nokia where it was founded in 1865, faltered - from both top-end iPhones and Samsung handsets using Google's popular Android software, and cheaper manufacturers in China and Asia.

Nokia's fall from grace has been blamed on its tardiness to gauge trends and to meet challenges. Although it had developed a touchscreen model well before the iPhone took the market by storm in 2007, it hadn't recognized the potential of the technology which is now standard on smartphones and other mobile devices.

If approved, the deal is expected to close in the first quarter of 2014.
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