Microsoft’s Acquisition of Nokia: Will the Gamble Work?





Case Details Case Introduction 1 Case Introduction 2 Case Excerpts

Abstract

In September 2013, US-based computing major, Microsoft Corp. (Microsoft) and Finland-based communications company, Nokia Corporation (Nokia), announced that both the companies would enter into a transaction where Microsoft would acquire Nokia’s Devices & Services segment, license Nokia’s patents and license and use Nokia’s mapping services, for US$ 7.2 billion.

Earlier in February 2011, Nokia had entered into a strategic alliance with Microsoft in a bid to combine the traditional strengths of the two companies to create synergies. With the acquisition of Nokia, Microsoft aimed to build on its partnership with the former by accelerating the growth of its share and profit in mobile devices through faster innovation, increased synergies, and unified branding and marketing.

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Issues

The case is structured to achieve the following teaching objectives:

  • Understand the role of acquisition as a growth strategy.
  • Analyze acquisition as a strategy to face competition.
  • Examine the rationale behind the acquisition.

Contents
Introduction
About Nokia
About Microsoft Corporation
The Challenge
Forging A Strategic Alliance
Microsoft Acquires Nokia
The Synergies
The Response
Will The Gamble Work?
Exhibit

Keywords

Microsoft, Nokia, Acquisition, Strategic alliance Smartphone market, Google, Apple, iPhone, Samsung, Windows Phone OS, Android Patent, Licensing, Brand equity, Emerging Markets

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