Nokia-Microsoft deal delayed but expected to close by end of April

A man uses the camera of a Nokia Lumia 820 smartphone as he poses in this photo illustration. Photograph: Dado Ruvic RUVIC/REUTERS

Regulatory roadblocks have delayed Microsoft's €5.4bn (£4.6bn) acquisition of Nokia's handset business, but the software company expects the deal to be concluded in April.

In India, Nokia has been tied up in legal cases with the governments of various regions. The southern state of Tamil Nadu filed a €300m claim on Friday relating to the company's manufacturing plant in Chennai, on the basis that it had sold handsets made there inside India, which would make them liable to tax. Exported handsets are not subject to tax. The factory's ownership is being transferred to Microsoft, triggering the tax claims.

Meanwhile in China, the government's Ministry of Commerce is reported to be pressuring Microsoft and Nokia to lower its patent fees which cover a wide range of handset and mobile functionality. The remaining part of Nokia will retain ownership of its mobile patents, which it is seeking to monetise, while Microsoft has its own array which it has asserted against dozens of Android device-makers around the world.

In a blogpost, Microsoft's legal chief, Brad Smith, said that the company was awaiting "approval confirmation" in remaining markets, after receiving the go-ahead from 15 other regulators. Those include the US and Europe.

"This work has been progressing, and we expect to close next month, in April 2014," Smith said. When the deal was originally announced, the two companies said that they expected it to close in March 2014, and Nokia classed its handset business under "discontinued" in its financial results for the three months to December. The delay almost certainly means that Nokia will have to report some details from the handset business with its financial results in April.

The acquisition of the loss-making business, announced in September, positioned Microsoft to challenge Apple and Google, which at the time owned the Motorola handset business. Steve Ballmer, then chief executive, said that it was "a bold step into our future" and "a signature event in our transformation" into a "devices and services" business.

Subsequent reports suggest that tensions between Ballmer and Microsoft's board over the wisdom of the deal – which Ballmer drove through against some resistance from other directors – led to his decision to step down from the post, to be replaced by Satya Nadella in January.