Ericsson is all set to buy New Jersey based Telecordia Technologies Inc. for US 1.15 billion dollar to add software and services support in addition to it’s core network deployment business, said a statement issued by the company.
Statement said that Ericsson agreed to buy 100 percent shares, all in cash for USD 1.15 billion, from Providence Equity Partners, LLC and Warburg Pincus. 2600 employees of Telecordia will transit to Ericsson as part of agreement.
Ericsson said that deal is anticipated to close by Q4 2011 with full effect in Q1 2012.
Analysts say that this buyout will enhance Ericsson’s position for better hardware and software offerings, particularly when European network providers are facing tough competition from Chinese network vendors.
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 is 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 managed services, growing in the same range.
It merits mentioning here that Telecordia provided MNP solution to Pakistani cellular/fixed telcos. Firm is also fighting it’s case to offering similar solution to Indian operators, where Government is hindering it’s way due to it’s operative connections with Pakistan.