Microsoft to win EU okay for $7.3 billion Nokia deal: sources
(Reuters) - Microsoft is set to secure unconditional EU regulatory approval for its proposed 5.4-billion-euro ($7.30 billion) takeover of Nokia's mobile phone business, two people familiar with the matter said on Friday.
Context & Ripple Effects
Two people familiar with the matter told Reuters that Brussels is preparing to wave through Microsoft's 5.4-billion-euro purchase of Nokia's handset unit without conditions, and the report travelled fast — picked up the same day by CNET, BGR, eWeek, Ubergizmo, Softpedia and Windows-centric WMPoweruser, a sign of how closely the enthusiast press is tracking the deal's final hurdles. Both the price and the unconditional clearance remain sourced reports rather than confirmed decisions.
What makes the timing pointed: Nokia has just shipped what reviewers call a solid but flawed first Windows tablet, the Lumia 2520, widely noted as possibly the last device it will launch as an independent phonemaker. An unconditional green light would mean EU competition enforcers see no threat in a software vendor buying a hardware partner whose Lumia phones run Microsoft's own OS.
First-order effects
- Microsoft would clear its largest acquisition barrier in Europe, leaving it free to close on Nokia's phone business and fold the Lumia line, the Lumia 2520 tablet effort, and tens of thousands of device employees into its own organization.
- Nokia's handset customers, carriers and retail partners face an imminent change of counterparty: the company they buy Windows Phones from becomes Microsoft itself.
Second-order effects
- Samsung, Apple and Google's Android ecosystem confront a competitor that controls both the operating system and the hardware roadmap end to end — removing the licensing friction that historically slowed Microsoft's mobile push.
- Component suppliers and contract manufacturers serving Nokia's phone lines would renegotiate against a far larger buyer, and any rival handset maker weighing a Windows Phone license now weighs partnering with a direct hardware competitor.
Third-order effects
- An unconditional clearance would signal that EU merger review treats vertical combinations — a platform owner absorbing a device maker — as categorically less threatening than horizontal mergers between direct competitors, a template other large tech deals would be measured against.
- If the pattern holds, more of the industry's value migrates from licensed operating systems to integrated hardware-software stacks, pressuring remaining license-based phonemakers to consolidate or differentiate.
The trend: Competition authorities are distinguishing sharply between vertical acquisitions that fold suppliers or partners into platform owners and horizontal mergers, clearing the former without remedies even at multi-billion-euro scale.