Tech giant Microsoft Corporation (NASDAQ:MSFT) recently considered acquiring Nokia but decided against it. It was reported that Nokia allowed Microsoft to take a look inside their books and that’s when the company decided not to buy them after all.
This is a very smart move on Microsoft’s behalf. Nokia Corporation (NYSE:NOK) is failing fast as their sales have plummeted significantly in the last few years. Just over the last five years, Nokia’s share sales decreased by ninety percent to just $2.91 a share. If Microsoft decided to purchase the poorly performing mobile company, it wouldn’t cost them that much to purchase the company for little but making such a purchase would probably reflect badly on the company and it could end up costing them in the long run.
Andrew Orlowski from The Register elaborated the decision Microsoft made, “But well-placed sources tell us that Microsoft was given access to Nokia’s books late last year in an attempt to evaluate which parts, if any, were worth acquiring. Not many people know this. The story is that having had a gander, Microsoft walked away.”
He further mentioned that the only reason Microsoft considered acquiring Nokia was to prevent a rival company from purchasing it.
Sometime last week there were rumors circulating that Samsung was contemplating purchasing Nokia, and last winter it was rumored that both companies were considering a joint effort to acquire Research In Motion Limited (NASDAQ:RIMM.
As I stated earlier in this article, I think it was a wise decision on Microsoft’s behalf to forgo the purchase of Nokia. As a large company that has been failing in the mobile industry, I just don’t think it would be the smartest decision to buy up another failing mobile company in hopes of saving their own mobile business. Before they consider buying up another mobile company(failing or not)I think Microsoft’s number one focus should be perfecting their mobile business.
