Ericsson to Acquire Nortel's 50% Stake in LG-Nortel

Ericsson will acquire Nortel’s majority shareholding (50%+1 share) in LG-Nortel, the joint venture of LG Electronics and Nortel Networks. The joint venture includes important contracts with Korean operators such as KT, LG Telecom and SK Telecom. Financials were not yet disclosed.

Ericsson said the deal significantly expand its footprint in Korea. Furthermore, the acquisition will provide Ericsson with an industrial base and the ability to build new customer relationships.
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http://www.lg-nortel.com

• In November 2005, LG Electronics and Nortel officially launched their joint venture, LG-Nortel offers communications and networking solutions in the wireline, optical, wireless and enterprise markets in South Korea and the rest of the world.
• In May 2009, Nortel, which had recently entered into bankruptcy proceedings, disclosed its intention to find a buyer for its majority stake (50% + 1 share) in LG-Nortel, the company’s Korean joint venture with LG Electronics. Nortel has made this decision to secure a sound future for the LG-Nortel business, its valued customers and employees. At the time, the company noted that LG-Nortel was a profitable, standalone business with a strong balance sheet, and not part of its bankruptcy proceeding. The joint venture was said to have enjoyed solid revenues and profits since its establishment in November 2005, with several significant customer wins in Korea and abroad. The business achieved a Management Operating Margin of $341 million, or 27%, in 2008, and Management Operating Margin for the first quarter of 2009 of 26%.