Microsoft to divest entry-level feature phone assets

Microsoft Corp today said that it has reached an agreement to sell its entry-level feature phone assets to FIH Mobile Ltd., a subsidiary of Hon Hai / Foxconn Technology Group, and HMD Global Oy for $350 million.

As part of the deal, FIH Mobile will also acquire Microsoft Mobile Vietnam, the company's manufacturing facility in Hanoi, Vietnam.

Post closing, around 4,500 employees will have the option to join, FIH Mobile or HMD Global Oy.

Microsoft will continue to develop Windows 10 Mobile and support Lumia phones such as the Lumia 650, Lumia 950 and Lumia 950 XL, and phones from OEM partners like Acer, Alcatel, HP, Trinity and VAIO.

As part of the deal, Microsoft will transfer substantially all of its feature phone assets, including brands, software and services, care network and other assets, customer contracts, and critical supply agreements.

The transaction is expected to close in the second half of 2016, subject to regulatory approvals and other closing conditions.