Electronics Production | April 21, 2010
Ericsson buys LG-Nortel joint venture part
Ericsson has entered into a share purchase agreement to acquire Nortel's majority shareholding (50%+1 share) in LG-Nortel, the joint venture of LG Electronics and Nortel Networks.
The transaction is subject to customary regulatory approvals. This acquisition will expand Ericsson's footprint in the Korean market and provide Ericsson with a well established sales channel and strong R&D capability in the country. Furthermore, the acquisition will provide Ericsson with an industrial base and the ability to build new customer relationships. The joint venture includes important contracts with Korean operators such as KT, LG Telecom and SK Telecom. LG-Ericsson will become one of the major telecom players in Korea. The joint venture was established in 2005 through the contribution by LG Electronics of its telecommunications systems business and by Nortel of its Korean distribution business. The joint venture will continue to be headquartered in Seoul, Republic of Korea.