Nokia investors have welcomed the Finnish firm's deal with Microsoft, sending shares in the company up more than 40% in Helsinki during trading today.
However, Microsoft shares fell almost 6% in early trading on Wall Street.
Technology giant Microsoft is to buy Nokia's mobile phone arm in a "bold step" in the smartphone market that will cost it about £4.6 billion
Outgoing Microsoft boss Steve Ballmer, who announced plans to retire last month, said: "It's a bold step into the future - a win-win for employees, shareholders and consumers of both companies."
Microsoft has agreed to buy "substantially all" of Nokia's mobile phone business at a cost of 5.4 billion euros (£4.6bn).
The deal, which is still subject to approval by Nokia shareholders and regulators, reportedly includes licences to the Finnish company's patents.
Nokia partnered in 2011 with Microsoft and uses Microsoft's Windows software to run its mobile phones.