Ericsson Makes Cash Offer for Subsidiary.
Ericsson currently holds 71.19% of the shares in Ericsson SpA, and the offer for the remaining 28.81% stake is valued at 237.3m euros ($281.65).
Ericsson SpA is the sole remaining listed subsidiary within the Ericsson Group, and the acquisition is intended to simplify the Ericsson Group structure. It follows similar offers for minority stakes in Ericsson's Brazilian and Mexican operations in 1998 and 1995 respectively.
Ericsson SpA is listed on the Milan Stock Exchange, and employs roughly 2,200 staff. It provides telecommunications equipment for mobile and fixed-line telephony in the Italian market. Last year, it reported a consolidated EBIT of 52m euros ($61.7m) on sales of 1.07bn euros ($1.27bn).
The Stockholm, Sweden-based company intends to delist its subsidiary shares from the Milan stock exchange and instead concentrate trading in Ericsson shares in Stockholm, London, and in the United States.
The move to simplify the structure of the Ericsson Group, and to reduce the number of listed subsidiaries, follows the reforming of its controversial voting structure to allow foreign shareholders a greater say in the company, in February.
The deal is expected to be approved by the end of June.
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|Article Type:||Brief Article|
|Date:||Apr 27, 2004|
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