Ericsson has completed the acquisition of Telcordia for $1.15 billion 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 employees have joined Ericsson.
Prior to this, Ericsson had entered into a merger agreement with Providence Equity Partners, LLC and Warburg Pincus to acquire 100 percent of the shares of Telcordia.
Per Borgklint, Head of Ericsson?s business unit Multimedia, commented, ?The addition of Telcordia?s skilled people and knowledge, a good multi vendor product portfolio and an important customer base in North America, complement 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.?
The combination of the two companies will address the needs of communications service providers to deliver mobile broadband and operational transformation to their subscribers.
The OSS/BSS 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 $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 $739 million during the last fiscal year ended January 31, 2011. Telcordia will be managed by Ericsson?s business unit Multimedia but sales and margins will be shared between Multimedia and Services depending on the portfolio mix.
