"As announced earlier (October 7), we are stopping handset production at our Chennai plant from tomorrow (November 1) in the absence of orders from our new parent firm (Microsoft), which terminated the mobile purchase agreement,"
Note
Touted as Nokia's largest production facility outside Europe, the Chennai plant started rollout out initially low-end mobile handsets from January 2006 after it was unveiled by then prime minister Manmohan Singh in the presence of his Finnish counterpart Matti Vanhanen.
At the time of closing down the operations, about 1,100 employees were working in the plant, including 900 on the assembly lines.
Nokia made a cumulative investment of $300 million (Rs.1,800 crore) in the Chennai factory over the last eight years
Microsoft, which acquired the Finland-based Nokia's global devices and services business, including assets in India for $7.2 billion decided to suspend manufacturing handsets from its Chennai plant though it could not take possession of it due to legal battles over a tax notice from the Tamil Nadu government and the Supreme Court
In September 2013, Nokia announced it would sell its devices and services (D&S) business, including assets in India, to Microsoft for $ 7.2 billion by March 2014.
The deal was completed on April 25,2014 but Chennai facility could not be
transferred to Microsoft because of legal issues related to tax demand
by the governmentThe TN government slapped a Rs.2,400 crore notice to Nokia's India subsidiary in March, accusing it of selling the handsets from the Chennai plant in the domestic market than exporting them.
In another tax case, the SCI directed Nokia India in March to furnish a Rs.3,500-crore guarantee before transferring the plant to Microsoft.
