Swedish company Ericsson announced the signing of an agreement, which provides for the purchase of American company Cradlepoint, specializing in wireless network equipment. The deal amounts to $1.1 billion, which makes it the largest acquisition of Ericsson since 2007. The Cradlepoint acquisition is expected to strengthen Ericsson’s position in the 5G enterprise equipment market by providing Ericsson with access to 4G and 5G Internet solutions.
As a result of this transaction Cradlepoint will become a subsidiary of Ericsson. Cradlepoint currently sells routers and wireless network services on a subscription basis, mainly targeting the U.S. market, but Ericsson intends to expand its sales, retaining Cradlepoint as a separate business with its own sales department.
At the same time, the new owner plans to sell Cradlepoint products to its customers from among mobile operators. These, in turn, will sell them to their customers, having the opportunity to create new revenue streams.
The transaction is expected to be completed by the end of this year.