Posted May. 20, 2016 07:54,
Updated May. 20, 2016 07:58
Taiwan’s Hon Hai/Foxconn Technology has acquired the feature phone (Nokia brand) assets, following its previous acquisition of Sharp.
Microsoft Corp. announced on Wednesday local time that it sold its feature phone assets (previously acquired from Nokia) to FIH Mobile, a subsidiary of Hon Hai/Foxconn Technology, and HMD Global for 350 million U.S. dollars.
This contract will be finalized in the second half of this year after the approval of the regulators. Microsoft will transfer all of its feature phone assets, including brands, software and services, care network and other assets, to Foxconn, which has expanded its businesses as it acquired Sharp, the previous leader of Japan’s display industry, in April.
Nokia reached the global market share of 40 percent in 2008, but due to its failure to capitalize on the smartphone boom, the company had to sell its feature phone unit to Microsoft for 5.4 billion euros in 2014. This means that the unit’s value has declined to one eighteenth of what it was in 2012.
FIH Mobile will be in charge of the manufacturing and engineering support of new Nokia smartphones, while HMD Global, a newly created Finnish company led by former Nokia and Microsoft executives, will manage design, development and sales.
Nokia’s plan to re-enter the smartphone market has received mixed responses. "The brand is strong in the feature phone space, but does it stand for a cutting-edge future proof smartphone? That's unclear,” said Ben Wood, an analyst at research firm CCS Insight. On Thursday, Nokia shares rose by 2.95 percent to 4.67 euros on the positive news.