Ericsson to buy wireless networking firm Cradlepoint in $1.1 billion deal

imageStock Markets35 minutes ago (Sep 18, 2020 03:10AM ET)

(C) Reuters. The Ericsson logo is seen at the Ericsson’s headquarters in Stockholm

STOCKHOLM (Reuters) – Ericsson (ST:ERICb) has agreed to buy U.S.-based wireless networking company Cradlepoint in a $1.1 billion deal, the Swedish telecoms gear maker said on Friday.

The deal, Ericsson’s largest in more than a decade, would give it access to tools that can connect devices using Internet of Things over a 4G or a 5G network.

The transaction, expected to close before the end of this year, will hurt Ericsson’s operating margins by about 1% in 2021 and 2022, and contribute to operating cash flow starting in 2022.

Ericsson said its 2022 group financial targets remained unchanged.

Cradlepoint, which will become a subsidiary of Ericsson, was founded in 2006, has more than 650 employees, and provides subscription-based wireless networking software and hardware to businesses.

It had sales of 1.2 billion crowns ($137 million) in 2019, with a gross margin of 61%.

Ericsson to buy wireless networking firm Cradlepoint in $1.1 billion deal

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.