Ericsson acquires Telcordia @ N186.2bn

Ericsson, at the weekend, concluded the acquisition of Telcordia, a global leader in the development of mobile, broadband and enterprise communications software and services, for USD 1.15 billion, about N186,2bn  in an all cash transaction, on a cash and debt-free basis.

Telcordia is now part of the Ericsson Group and its approximately 2,600 skilled employees have joined Ericsson.

ITRealms Online gathered that this acquisition consolidates Ericsson’s position as a leading player in operations support systems/business support systems (OSS/BSS) market with key position in service fulfillment, assurance, network optimization and real-time charging.

Also, industry watchers said that this deal would boost Ericsson’s earnings per share within 12 months, adding that the conclusion of the Telcordia deal follows the announcement on June 14, 2011, that Ericsson had entered into a merger agreement with Providence Equity Partners, LLC and Warburg Pincus to acquire 100 per cent of the shares of Telcordia.

Per Borgklint, Head of Ericsson’s business unit Multimedia, said that the addition of Telcordia’s skilled people and knowledge, is a good multi vendor product portfolio and an important customer base in North America, thus complements Ericsson’s already established position in the OSS/BSS space.

“OSS and BSS are key to drive the customer experience and serve as the engine to monetizing traffic, offerings and products that operators sell. All in all, these systems are crucial to create the experience users expect in a cost efficient manner,” he said. 

The combination of the two companies, he said, creates the leader in service fulfillment, service assurance and network optimization and gives Ericsson a leading position in real-time charging and significant capabilities to support operators end to end.

The combination will address the needs of Communications Service Providers to deliver mobile broadband and operational transformation to their subscribers. 

The OSS/BSS, he explained is a growing market driven by the demand for business efficiency, innovation and high quality user experience. 

In 2010, the market for software and systems integration was valued at about USD 35 billion and is expected to show a compound annual growth rate between 6-8 percent between 2010 and 2013.

In addition, there is an attractive market for outsourced and hosted OSS and BSS managed services, growing in the same range.

Telcordia is headquartered in Piscataway, New Jersey, and generated revenues of USD 739 million during the last fiscal year ended January 31, 2011.

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