Ericsson announces sale of iconectiv
- iconectiv is a US subsidiary of Ericsson acquired in 2012, and a provider of network number portability solutions and data exchange services
- The divestment will allow iconectiv to continue its growth trajectory under the new ownership of Koch Equity Development LLC
STOCKHOLM, Aug. 17, 2024 /PRNewswire/ -- Ericsson (NASDAQ: ERIC) announces that it has entered into a binding agreement with Koch Equity Development LLC in relation to the sale of iconectiv (the "Transaction").
Ericsson's cash benefit from the Transaction, after the settlement of anticipated taxes, transaction expenses, and other liabilities, is expected to be approximately SEK 10.6 billion [1] (USD 1.0 billion).
Ericsson expects to record a one-off EBIT benefit of approximately SEK 8.8 billion [1] (USD 0.8 billion) on closing of the Transaction.
The Transaction is subject to customary closing conditions, including regulatory approvals, with completion targeted during the first half of calendar 2025.
iconectiv is consolidated by Ericsson and reported within Segment Enterprise. iconectiv's contribution [2] to Ericsson 2023 net income was approximately SEK 1.0 billion (USD 0.1 billion).
iconectiv is a US subsidiary of Ericsson acquired in 2012 as part of the Telcordia acquisition. Since 2017, iconectiv has been co-owned with private equity firm Francisco Partners. iconectiv serves over 5,000 customers across various sectors as a leading provider in number portability solutions, and a provider of core network and operations management, numbering and data exchange services as its main segments, and with limited strategic synergies with the rest of Ericsson's portfolio.
[1] Assuming a USD - SEK exchange rate of 10.56. Realized exchange rate to be determined on closing.
[2] Contribution to net income including minority interests and shareholder loan impacts. Ericsson's shareholder loan to iconectiv was SEK 6.7 billion at year end 2023.
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Forward-looking statements
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This is information that Telefonaktiebolaget LM Ericsson is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, at 22:30 CEST on August 16, 2024.
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SOURCE Ericsson
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