The Telegraph
Wednesday , April 23 , 2014
CIMA Gallary

Nokia local suspense on

In transition

Chennai, April 22 (PTI): The fate of Nokia’s Chennai facility still hangs in balance even as the Finnish handset maker strives to conclude its $7.2-billion deal with Microsoft by this week.

Nokia yesterday said it expected to conclude the deal with Nasdaq-listed Microsoft for the sale of its mobile devices and services business on April 25 and hoped it would continue to operate the Chennai plant under a “service agreement”.

The plant, at Sriperumbudur near Chennai, is one of Nokia’s biggest facilities in the world, employing about 8,000 persons directly and about 12,000 indirectly.

“With Chennai, it is worth remembering that we have said we will consider a services agreement with Microsoft should our Indian assets not be able to transfer at the close of the global deal,” a Nokia spokesperson said.

A Nokia official had earlier said the company was still exploring the option of operating the Chennai plant as a contract manufacturer for other companies.

The employees, backed by the Nokia India Thozhilalargal Sangam (Nokia India Employees Union), are apprehensive about the move, alleging that this may lead to a substantial reduction in manpower.

Last year, the employees had resorted to a strike and impleaded themselves in a petition before the Delhi high court, stating that considering their future, the Chennai plant should be included in the Nokia-Microsoft deal.

However, because of the tax dispute faced by Nokia India and the deal between Nokia and Microsoft set to complete in few days, the plant is likely to be excluded from the deal.