Ericsson to divest its power modules business to Flex
June 21 2017 - 3:15AM
- Transaction expected to close in the third
quarter of 2017
- A workforce of over 300 people to move from
Ericsson to Flex Power, a division within Flex
- Divestment in line with Ericsson's
previously-announced business strategy of focusing on core
portfolio areas
Ericsson (NASDAQ:ERIC) has signed an agreement with multinational
technology and Sketch-to-Scale(TM) solutions provider, Flex, to
divest Ericsson Power Modules (EPM). The divestment is in line with
Ericsson's focused business strategy, presented on March 28, to
strengthen its core business and portfolio areas (networks, digital
services and IoT).
The Ericsson Power Modules business, excluding the
brand, will on closing be transferred to Flex as part of the
agreement. This includes Shanghai Ericsson Electronics Corporation
Ltd, a manufacturing site in China, and business assets in Sweden.
More than 300 employees and consultants are expected to transfer
from Ericsson to Flex Power.
Christian Hedelin, Head of Strategy, Business Area
Networks, Ericsson, says: "Ericsson Power Modules with its skilled
people has built a strong position and offering within the power
industry. But, in line with our strategy, we are focusing our
business on fewer core areas. The power modules business is a
perfect fit for Flex, and we look forward to working together to
ensure a smooth transition and a lasting relationship."
Nate Vince, President of Flex Power, says: "We are
very pleased to be expanding our collaborative and successful
long-standing partnership with Ericsson, while adding the talented
and industry-leading Power Module team to Flex. In addition to
enhancing our power capabilities and Sketch-to-Scale solutions, we look forward to
leveraging this partnership to expand our offerings to the cloud
and telco data center markets."
The transaction is expected to close in the third
quarter of calendar year 2017 and is subject to customary closing
conditions, including regulatory approvals.
Ericsson Power Modules designs and manufactures
power supply products for information and communications equipment,
including radio base stations, switches and routers, as well as
additional computing and industrial applications.
Flex operates in the power segment with Flex
Power, delivering power supply products to a wide range of markets,
with some of the world's biggest brands as customers. Flex is the
Sketch-to-Scale(TM) solutions provider that designs and builds
Intelligent Products for a Connected World(TM). With approximately
200,000 professionals across 30 countries, Flex provides innovative
design, engineering, manufacturing, real-time supply chain insight
and logistics services to companies of all sizes in various
industries and end-markets. For more information, visit
flex.com.
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Ericsson is a world leader in
communications technology and services with headquarters in
Stockholm, Sweden. Our organization consists of more than 111,000
experts who provide customers in 180 countries with innovative
solutions and services. Together we are building a more connected
future where anyone and any industry is empowered to reach their
full potential. Net sales in 2016 were SEK 222.6 billion (USD 24.5
billion). The Ericsson stock is listed on Nasdaq Stockholm and on
NASDAQ in New York. Read more
on www.ericsson.com.
Ericsson to divest its power
modules business to Flex
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Source: Ericsson via Globenewswire
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