Microsoft has bought out Nokia for $7.5bn (£4.46bn) in a deal that was finalised today.

The Finnish phone company used to rule the roost, peaking with a 40 per cent market share in 2008, but has had a tough few years. Now Microsoft, who has collaborated with the company before on the Lumia line, has bought its smartphone and mobile phone businesses, its design team, most of its manufacturing and assembly facilities and its sales and marketing support.

The deal sees Microsoft acquire 25,000 Nokia employees across 50 countries, take over its Helsinki headquarters and bring an end to Nokia-manufactured phones. Nokia has said it will now focus on networks, mapping services and technology development. More details of future plans will be announced when first-quarter earnings are released on April 29. Nokia’s share price was up more than 1.5% in Helsinki’s afternoon trading.

Stephen Elop, former Nokia CEO turned Microsoft executive, said: “The opportunity for Microsoft to be both a devices and services company, so that it can deliver the complete proposition to its consumers, is at the heart of this.”

Microsoft CEO Satya Nadella said: “Today we welcome the Nokia Devices and Services business to our family. The mobile capabilities and assets they bring will advance our transformation. Together with our partners, we remain focused on delivering innovation more rapidly in our mobile-first, cloud-first world.”

Elop will directly report to Nadella and will serve as executive VP of the Microsoft Devices Group.

Microsoft said in a statement that Windows Phone is the fastest-growing platform in the smartphone market. “Furthermore, with the Nokia mobile phone business, Microsoft will target the affordable mobile devices market, a $50 billion annual opportunity, and delivering the first mobile experience to the next billion people while introducing Microsoft services to new customers around the world.”