Ericsson Acquires 5G Equipment Manufacturer Cradlepoint
Swedish telecommunications equipment manufacturer Ericsson is buying American company Cradlepoint, which provides solutions for 4G and 5G networks, for $1.1 billion, according to a press release from Ericsson.
"Ericsson has reached an agreement to purchase Cradlepoint, the US market leader in solutions... for 4G and 5G. This investment is key to Ericsson's current strategy to gain market share in the rapidly expanding 5G Enterprise space, " the report said.
The transaction is expected to close during the fourth quarter of 2020, subject to the necessary conditions. Cradlepoint will become a wholly-owned subsidiary of Ericsson, continuing to operate under the existing brand.
Ericsson's collaboration with Cradlepoint began with the launch of 4G in the US market more than ten years ago.
Ericsson is a Swedish company that provides solutions and technologies for communication networks, digital services, advanced technical support, and network maintenance. Its headquarters are located in Stockholm.
Cradlepoint is a privately held company founded in 2006, headquartered in Boise and with a development center in Silicon Valley, USA. It also has offices in the UK and Australia. In 2019, the company's sales totaled $137 million.
The acquisition price amounts to an enterprise value of USD 1.1 b. with the transaction expected to close before the end of Q4 2020, subject to closing conditions. The purchase price, which is funded from Ericsson’s cash-in-hand, is paid in full on closing. Cradlepoint’s sales for 2019 were SEK 1.2 b.