Microsoft is in the advanced stages of closing its acquisition of Nokia’s handset business, but in the meantime Nokia is reportedly working on Android devices. How does Microsoft feel about that? “They’ll do some things we’re excited about, and some things we’re less excited about,” said senior executive Joe Belfiore, to a room of chuckling journalists and analysts.

“We have a terrific engineering relationship with Nokia,” he noted. “We’ve done a bunch of excellent collaboration [on] products…We’re proud of the work we do together.”

Nevertheless, as many have rumored, bolstered by some apparently leaked images (such as the ones here), Nokia has also been spinning other plates, with the WSJ reporting that the so-called Normandy device coming as soon as later this month.

Why? As Natasha pointed out the other day, this wouldn’t be an official Android device but a forked version, along the lines of what Amazon and many Asian handset makers have created. The idea here would be that it could use the device to target specifically lower-end users who are not reachable at the lowest price points of Nokia’s Lumia devices, but are looking for a “smarter” device than the Asha line from Nokia. The handset, the WSJ reports, has been in the works from before the deal with Microsoft was set, and points to how, with with many engineers and others leaving Nokia through layoffs, there are still some wildcards in the pack.

Image: Evleaks