Microsoft just purchased Nokia’s smartphone business, including the rights to its patents, for ~ $US7.2 billion.
How did the acquisition talks begin, and how long did they take to finalise?
Although Microsoft has spent a few years thinking about how to succeed in the smart phone business, the acquisition talks began in January or February, after the Mobile World Congress summit in Barcelona.
That’s where Microsoft CEO Steve Ballmer and Nokia CEO and Chairman Risto Siilasmaa met. Ballmer tells The Verge’s Joshua Topolsky that he reached out to Siilasmaa about a deeper partnership opportunity shortly after that meeting. Nokia’s board met more than 50 times to discuss the proposed Microsoft acquisition, according to AllThingsD’s Ina Fried.
Early conversations weren’t just about an acquisition. The two companies explored a number of opportunities before the $US7 billion deal was made.
“[Siilasmaa] wanted to make sure we exhausted all possibilities since we were going to be partners in any event whether we did a deal like this or a variety of other modifications to our operating partnership,” Ballmer told Topolsky. “I think that was a valuable exercise in terms of really identifying what are the key things for us to do to really accelerate our partnership.”
Ballmer tells ATD’s Ina Fried: “”We had a Plan A, a Plan B a Plan C. And by the time we were done, we had A, A1, A-Prime, B, C, D, E.”
The acquisition was finalised prior to Ballmer’s retirement announcement in August.
Ballmer will be stepping down from his CEO position within the year. His successor has not yet been selected, although Nokia’s former CEO and Microsoft’s current EVP of Devices and Services, Stephen Elop, now looks like the top candidate. Ballmer reached out to Elop and Siilasmaa shortly before the announcement to make sure they wouldn’t be spooked.
In the end, the pair say a partial acquisition made the most sense.
“We looked at many, many possibilities together,” Baller tells Fried. [We] ultimately took this one with us buying all of Nokia’s phone business, becoming an innovation partner and customer of [Nokia’s mapping product] Here and licensing patents from Nokia.”