LM Ericsson AB has signed a deal to buy U.S.-based software development firm Telcordia for $1.15 billion, the Swedish wireless equipment company said Tuesday.
Ericsson said it will buy 100 percent of the shares in Telcordia from private equity firms Providence Equity Partners LLC and Warburg Pincus and expects to complete the acquisition in the fourth quarter 2011.
Telcordia, based in Piscataway, New Jersey, develops mobile, broadband and enterprise communications software and services. It reported revenues of $739 million during the fiscal year, ending January 31 and employs 2,600 people who will now be transferred to Ericsson.
The Swedish company said Telcordia has a leading market position within the operations and business support system field _ producing computer systems that are used by telecommunications operators to handle the growth in mobile and fixed broadband traffic.
"The importance of operations and business support systems will continue to grow as more and more devices are connected, services become mobile and new business models for mobile broadband are introduced," Ericsson CEO Hans Vestberg said.
The acquisition is subject to regulatory approvals.
Shares in Ericsson rose by 1.8 percent to 88.80 Swedish kronor ($13.99) in Stockholm.