Marconi has agreed to sell its name and telecom equipment assets to Ericsson for £1.2 billion ($2.1 billion). The UK company will retain its service business under the name Telent. Ericsson claims growing demand for mobile and fixed broadband convergence is driving the deal. An estimated 6,670 Marconi staff will move to Ericsson, but the company expects to lay off some 1,000 workers, especially those at Marconi's UK sites and overseas.
Ericsson agreed to acquire all of Marconi's telecom equipment assets, including DSL, softswitch and optical businesses. Ericsson will also be buying Marconi's data networking assets, but not some of Marconi's UK and German operations, even though the company was previously rumored to be doing the opposite. Analysts at Ovum say Marconi's former position as a major player in the optical systems market will complement Ericsson's UMTS network. Marconi's DSL/MSAN assets could provide the necessary backhaul technology for Ericsson's mobile networks.
For more on the Ericsson, Marconi deal:
- take a look at this article from the BBC
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