Featured Story
Vodafone and Three merger looks shaky after BT's latest attack
BT draws attention to the unworkability of behavioral remedies and says the only effective structural one is prohibition.
Ericson pays $1.9B to acquire Redback Networks
December 20, 2006
STOCKHOLM -- Ericsson (NASDAQ:ERIC) and Redback Networks Inc. (NASDAQ:RBAK) have today announced that they have signed a definitive agreement under which Ericsson will acquire Redback for USD 25.00 per share, or an aggregate price of approximately USD 1.9 billion. The offer represents a premium of 60 percent to Redback's [90-day] volume weighted average stock price.
Ericsson offers USD 25.00 per share in cash
A total consideration of USD 1.9 b. after deduction of net cash
Cash transaction to be internally funded
Redback brings leading IP edge technology, critical in IP networks
Expands Ericsson's IP market presence and growth opportunities
Expands Ericsson's leadership in next generation IP networks
Redback was founded 1996 in San Jose, CA, the heart of Silicon Valley and listed on NASDAQ in 1998. Redback has over 700 carrier customers in more than 80 countries and employs about 800 people, including 500 R&D engineers. Fifteen of the top 20 telephone carriers worldwide use Redback's technology, including broadband routers to manage IP-based data, voice and video services.
Redback has a strong position in multi-service edge routing technology, which helps carriers deliver broadband, telephone, TV and mobility services over internet-based infrastructures. The company grew sales 33 percent for full year 2005 and 87 percent for the first nine months of 2006 to USD 197 m.
Carl-Henric Svanberg, president and CEO, Ericsson, says: "The combined strengths of both companies will create significant value for customers and shareholders and exciting opportunities for employees. The pace of IP deployment is accelerating as operators move to all-IP converged networks, in which quality of service requires increasingly intelligent routers with higher capacity."
Ericsson AB (Nasdaq: ERIC)
You May Also Like