Acquisition of Nortel's stake of the joint venture LG-Nortel
(Thomson Reuters ONE) -
· Strengthened ability to serve the Korean market and reach new
customers
· Second largest installed base with all leading Korean operators
· Purchase price is USD 242 million on a cash and debt free basis
· New name of the joint venture will be LG-Ericsson
Ericsson (NASDAQ:ERIC) has today entered into a share purchase agreement to
acquire Nortel's majority shareholding (50%+1 share) in LG-Nortel, the joint
venture of LG Electronics and Nortel Networks. The transaction is subject to
customary regulatory approvals.
This acquisition will significantly expand Ericsson's footprint in the Korean
market and provide Ericsson with a well established sales channel and strong R&D
capability in the country. Furthermore, the acquisition will provide Ericsson
with an industrial base and the ability to build new customer relationships.
The joint venture includes important contracts with Korean operators such as KT,
LG Telecom and SK Telecom.
LG-Ericsson will become one of the major telecom players in Korea.
"Korea is one of the largest telecom markets with advanced end-user demand of
new services. A strengthening of our position through the collaboration with our
new partner LG Electronics will enhance our position for future technology
shifts such as LTE," said Hans Vestberg, President and CEO of Ericsson.
"LGE is pleased to have Ericsson as a new partner in this joint venture," said
Yong Nam, Vice Chairman and CEO of LG Electronics. "Ericsson will provide global
industry experience and technical expertise that will benefit both customers and
employees. We look forward to a fruitful future collaboration."
"LG-Ericsson is expected to provide the Korean market with leading technology
and customer supports in cooperation with Ericsson's Global Leadership in
Telecommunication market. We are excited by the new perspective for our
company." said Jae Ryung Lee, CEO of LG-Nortel.
The joint venture was established in 2005 through the contribution by LG
Electronics of its telecommunications systems business and by Nortel of its
Korean distribution business. The focus of the joint venture has been to develop
and market large scale telecommunications systems such as WCDMA, CDMA and LTE
for telecom service providers in Korea as well as enterprise products and
services. In 2009, LG-Nortel generated approximately USD 650 million of sales
and had 1,300 employees.
The joint venture will continue to be headquartered in Seoul, Republic of Korea.
In July 2009, Ericsson and the Korean government agreed to cooperate in growing
a green ecosystem based on 4G technology. The competence in LG-Ericsson is
expected to contribute to this initiative.
The transaction is expected to have a positive effect on Ericsson's earnings
within a year after closing.
SEB Enskilda is acting as Ericsson's sole financial advisor in the transaction.
Notes to editors:
Pictures of Hans Vestberg, Ericsson CEO:
www.ericsson.com/ericsson/press/photos/management.shtml
Previously announced information on Ericsson's acquisitions of Nortel assets:
http://www.ericsson.com/ericsson/press/releases/20090725-1330882.shtml
http://www.ericsson.com/ericsson/press/releases/20091113-1354893.shtml
http://www.youtube.com/ericssonpress#p/u/7/D3yDHV9O_5o
Korean President and Ericsson CEO meet and agree to cooperate for 4G-based green
eco-system
www.ericsson.com/thecompany/press/releases/2009/07/1328344
Our multimedia content is available at the broadcast room:
www.ericsson.com/broadcast_room
Ericsson is the world's leading provider of technology and services to telecom
operators. Ericsson is the leader in 2G, 3G and 4G mobile technologies, and
provides support for networks with over 2 billion subscribers and has the
leading position in managed services. The company's portfolio comprises mobile
and fixed network infrastructure, telecom services, software, broadband and
multimedia solutions for operators, enterprises and the media industry. The Sony
Ericsson and ST-Ericsson joint ventures provide consumers with feature-rich
personal mobile devices.
Ericsson is advancing its vision of being the "prime driver in an
all-communicating world" through innovation, technology, and sustainable
business solutions. Working in 175 countries, more than 80,000 employees
generated revenue of SEK 206.5 billion (USD 27.1 billion) in 2009. Founded in
1876 with the headquarters in Stockholm, Sweden, Ericsson is listed on OMX
NASDAQ, Stockholm and NASDAQ New York.
www.ericsson.com
www.twitter.com/ericssonpress
www.facebook.com/technologyforgood
www.youtube.com/ericssonpress
FOR FURTHER INFORMATION, PLEASE CONTACT
Ericsson Corporate Public & Media Relations
Phone: +46 10 719 69 92
E-mail: media.relations(at)ericsson.com
Ericsson Investor Relations
Phone: +46 10 719 00 00
E-mail: investor.relations(at)ericsson.com
Ericsson discloses the information provided herein pursuant to the Securities
Markets Act and/or the Financial Instruments Trading Act. The information was
submitted for publication on April, 21 at 06:00 CET.
UPCOMING EVENTS
Ericsson's Capital Markets Day, Stockholm, Sweden, May 5-6
Ericsson Business Innovation Forum, Shanghai, China, May 17-18
For more information please contact the Ericsson Media Relations Team.
[HUG#1406030]
Press release ENG: http://hugin.info/1061/R/1406030/359726.pdf
Unternehmensinformation / Kurzprofil:
Datum: 21.04.2010 - 06:02 Uhr
Sprache: Deutsch
News-ID 19370
Anzahl Zeichen: 0
contact information:
Town:
STOCKHOLM
Kategorie:
Business News
Diese Pressemitteilung wurde bisher 187 mal aufgerufen.
Die Pressemitteilung mit dem Titel:
"Acquisition of Nortel's stake of the joint venture LG-Nortel"
steht unter der journalistisch-redaktionellen Verantwortung von
Ericsson (Nachricht senden)
Beachten Sie bitte die weiteren Informationen zum Haftungsauschluß (gemäß TMG - TeleMedianGesetz) und dem Datenschutz (gemäß der DSGVO).
