Ericsson Concludes Review Of Strategic Opportunities For Media Business

(RTTNews) - Ericsson (ERIC) has concluded the review of strategic opportunities for its Media business - Media Solutions and Red Bee Media.

As a first step in assessing strategic opportunities, Ericsson has implemented substantial performance improvement programs while continuing to invest in the respective business. Both units have made significant progress during 2017.

Ericsson has partnered with One Equity Partners, a private equity firm with deep expertise in media and telecom investments, to further develop Media Solutions.

Ericsson will retain 49% of the shares in the company. This structure will establish Media Solutions as a leading independent video technology company with strong and committed financial support driving continued investment in innovation and growth. The terms of the transaction are confidential.

Ericsson said that the company and One Equity Partners will form an independent company and will develop the business in line with its new business plan. The performance improvement initiatives initiated in 2017 will continue, and are showing tangible results.

Media Solutions employees and contractors, as well as specified assets and liabilities, will transfer to the new company upon closing. .

The divestment will not result in significant restructuring charges.

Closing of the transaction is expected in the third-quarter 2018 and is subject to customary closing conditions, including regulatory approvals.

After the transaction is closed, Ericsson's share of the business will continue to be reported in segment Other.

Meanwhile, Ericsson said it will continue to develop Red Bee Media as an independent and focused media services business. The Red Bee Media business will continue to be reported in segment Other.