Ericsson: We will fund Sony Ericsson if necessary

Ericsson reiterated its commitment to Sony Ericsson, and said it would be willing to pump more cash into the troubled joint venture if it was needed.

"In the situation they are in today, it is a natural measure to take that we plan for this so that we have the readiness if it were necessary," Ericsson CEO Carl-Henric Svanberg told reporters before the company's annual general meeting. "Then we will consider things depending on how the operations (of Sony Ericsson) develop."

Sony Ericsson posted a $386 million net loss for the first quarter and sales tumbled 36 percent. As a result, the handset joint venture between Sweden's Ericsson and Japan's Sony--the world's fourth largest cell phone maker--said it would cut 2,000 more jobs, or about one-fifth of its workforce.

Svanberg's statements put to rest speculation surrounding Ericsson's commitment to the business. A German magazine in March reported that Ericsson wanted to dissolve the venture, and that Sony was looking into opening negotiations with banks to raise the funds needed to acquire the 50-percent stake owned by Ericsson.

Svanberg said that joint venture was important to Ericsson because it gave the equipment maker insight into what consumers want.

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