Mobile shake-up looms as Microsoft strikes deal to buy mobile phone maker Nokia for $8b Nokia chief Stephen Elop with Microsoft's Steve Ballmer, speaking in London, as they announce a partnership in 2011. TECHNOLOGY giant Microsoft is to swallow struggling mobile phone maker Nokia in a deal worth more than $8 billion. Microsoft has announced it will pay 5.44 billion euros ($8 billion) for the Nokia's device business and licence patents. It comes as the Finnish company, once the world's biggest maker of mobile phones, struggles to maintain market share. Under the deal, Microsoft will pay 3.79 billion euros for the devices unit and 1.65 billion euros for patents, the companies said in a statement today. Nokia chief Stephen Elop will step aside to return to Microsoft, they said. Nokia is coping with cash-flow challenges stemming from weaker demand as its phones lose share to Apple iPhones and handsets that use Google's Android operating system. Mr Elop has cut more than 20,000 jobs. In January he suspended Nokia's dividend to shareholders an attempt to improve the group's finances. "After a thorough assessment of how to maximise shareholder value, including consideration of a variety of alternatives, we believe this transaction is the best path forward for Nokia and its shareholders," chairman Risto Siilasmaa said in a statement. Mr Siilasmaa will become interim chief executive of Nokia. Nokia reported in July a 27 per cent drop in the number of handsets sold in the second quarter. It has lost more than 5 billion euros in the past nine quarters. Microsoft, which is based in Redmond, Washington, in the US. has battled to stay relevant as consumers have shifted from using its core Windows software for PCs toward mobile devices from Apple and others. Facebook and Google have also pushed ahead in social networking and online advertising, areas where Microsoft remains weak. with Bloomberg