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Ericsson (NASDAQ:ERIC) shares are trading higher today. On Friday, the company inked a binding agreement with Koch Equity Development LLC regarding the sale of iconectiv.
iconectiv is a U.S. subsidiary of Ericsson acquired in 2012 and a provider of network number portability solutions and data exchange services. Since 2017, iconectiv has been co-owned with private equity firm Francisco Partners.
Ericsson expects to gain approximately SEK 10.6 billion ($1.0 billion) in cash from the deal after taxes, transaction expenses, and other liabilities.
Ericsson projects to record a one-off EBIT benefit of about SEK 8.8 billion ($0.8 billion) upon closing the transaction.
The transaction is expected to close in the first half of calendar 2025, pending customary regulatory approvals.
Richard Jacowleff, CEO of iconectiv, said, “iconectiv is excited to join KED along with the resources and capabilities they have to support our next chapter of growth. This acquisition marks a significant milestone in our journey, aligning us with a shareholder focused on long-term value creation that extends our track record as a trusted partner to service providers and regulators in the communications sector.”
As of June-end, Ericsson’s net cash stood at SEK 28.7 billion.
Investors can gain exposure to the stock via IShares U.S. Digital Infrastructure And Real Estate ETF (NYSE:IDGT) and Defiance Connective Technologies ETF (NASDAQ:SIXG).
Price Action: ERIC shares are up 1.13% at $7.18 at the last check Monday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Photo by Mats Wiklund via Shutterstock
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