Sony to buy out Ericsson in Sony Ericsson for $1.47 billion

By Andrew Couts October 27, 2011

Sweden-based telecommunications giant Ericsson announced today that Sony will buy out its 50 percent stake in the Sony Ericsson mobile phone business for $1.47 billion. The deal will give Sony complete ownership of Sony Ericsson.

As part of the deal, Sony will acquire “five essential patent families relating to wireless handset technology” from Ericsson, according to the press release. Sony will also now have the opportunity to incorporate the mobile phone business more closely into its lines of network-connected Sony consumer electronics.

“This acquisition makes sense for Sony and Ericsson, and it will make the difference for consumers, who want to connect with content wherever they are, whenever they want,” said Sony Chairman, President and Chief Executive Sir Howard Stringer. “…We can more rapidly and more widely offer consumers smartphones, laptops, tablets and televisions that seamlessly connect with one another and open up new worlds of online entertainment.”

Ericsson’s president and CEO, Hans Vestberg, said this of the acquisition, in a prepared statement:

Ten years ago when we formed the joint venture, thereby combining Sony’s consumer products knowledge with Ericsson’s telecommunication technology expertise, it was a perfect match to drive the development of feature phones. Today we take an equally logical step as Sony acquires our stake in Sony Ericsson and makes it a part of its broad range of consumer devices. We will now enhance our focus on enabling connectivity for all devices, using our R&D and industry leading patent portfolio to realize a truly connected world.

Some believe the deal will give Sony greater ability compete in a mobile world in which power is increasingly condensing. Apple’s iPhone is currently the single most-popular brand of smartphones in the United States, by far. And Google, with its market-topping Android operating system — and soon, with Motorola, its handset-making business — has become a powerhouse of the mobile industry. How Sony’s move will change the landscape of the mobile industry remains to be seen, but the effects will surely be felt across the board.

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