Nokia will stop production at its mobile handset manufacturing facility near Chennai in south India after a deal with Microsoft to manufacture phones fell through.
The factory was among Nokia assets frozen by Indian federal authorities in a dispute over taxes for mobile phone software licenses. It was supposed to have gone to Microsoft as part of its acquisition of Nokia's phone business in April this year.
As a result of the freeze, the company was not in a position to transfer the facility and its manufacturing operations to Microsoft. Nokia instead entered into a "transitional services agreement" to meet Microsoft's immediate production needs and keep the factory in operation.
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