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European Commission gives Microsoft/Nokia merger the green light

Redmond to march into Finland unopposed

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The European Commission has approved the merger between Microsoft and Nokia, clearing the way for Redmond to take over the Finnish firm's smartphone business.

The Commission published its findings in a press release on Wednesday, saying that it did not believe Microsoft's acquisition of Nokia raised any concerns under EU antitrust regulations.

Among the topics the Commission considered were whether Microsoft would be likely to withhold its Windows Phone OS from third parties following the merger, whether it would be likely to restrict the use of its mobile apps to its own devices, and whether it would try to limit other device makers' ability to interoperate with Exchange Server.

In each case, the Commission found that Microsoft would be unlikely to change its current behavior post-merger, and that in some cases, doing so would weaken its own competitive position. In sum:

The Commission concluded that the transaction would not raise any competition concerns, in particular because there are only modest overlaps between the parties' activities and the links between Microsoft's mobile operating systems, mobile applications and enterprise mail server software with Nokia's smart mobile devices are unlikely to lead to competitors being shut out from the market.

The decision comes just days after US regulators also gave the merger the thumbs-up. Nokia's shareholders approved the deal at a mid-November meeting in Helsinki, although the mood among many was glum.

Microsoft plans to take over "substantially all" of Nokia's Devices & Services business, including its Windows Phone–based Lumia smartphone line. Former Nokia CEO and past Microsoft employee Stephen Elop is expected to return to Redmond to head the division, although he is also thought to be a front-runner to take over the chief executive role when Steve Ballmer leaves.

A few more regulatory hurdles remain before the deal is done, but Microsoft CFO Amy Hood said during the company's most recent earnings conference call that she expects the transaction to close in the first calendar quarter of 2014.

"We look forward to the date when our partners at Nokia will become members of the Microsoft family," a Redmond spokesperson said in an emailed statement, "and are pleased that the European Commission has cleared the deal without conditions."  ®

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