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Oct 27, 2011

Official: Sony Buys Out Ericsson's Stake in Sony Ericsson

Speculations about the possible dissolve of the Sony Ericsson joint-venture have come and gone for years, but earlier this month sources close to the matter claimed that the move is imminent and scheduled for the end of the year.

Today, both companies announced they have come to an agreement to make the Sony Ericsson brand a thing of the past.

Ericsson and Sony Corporation has just announced that Sony will acquire Ericsson’s 50% stake in Sony Ericsson, which will wrest full control over the mobile phone business to Sony.

Furthermore, the reasons behind Sony's decision to take full control over the Sony Ericsson brand is the almost lack of interest from its Swedish counterpart, as well as the negative impact that its entire Xperia lineup had on the joint-venture's financial results.

In addition, Sony plans to integrate smartphones with its televisions, PCs, tablets and console gaming operations, in order to save costs and have a better development strategy.

Under agreement, Sony will pay Ericsson 1.05 billion EUR ($1.47 billion) for its 50% stake in Sony Ericsson.

“This acquisition makes sense for Sony and Ericsson, and it will make the difference for consumers, who want to connect with content wherever they are, whenever they want. With a vibrant smartphone business and by gaining access to important strategic IP, notably a broad cross-license agreement, our four-screen strategy is in place,” said Sir Howard Stringer, Sony’s Chairman, Chief Executive Officer and President.

Following the transaction, Sony will also gain a broad intellectual property cross-licensing agreement previously owned by Sony Ericsson, including five essential patent families relating to wireless handset technology.

“We can more rapidly and more widely offer consumers smartphones, laptops, tablets and televisions that seamlessly connect with one another and open up new worlds of online entertainment. This includes Sony’s own acclaimed network services, like the PlayStation Network and Sony Entertainment Network,” concluded Stringer.

According to Sony, the transaction has been approved by both companies and is expected to close in January 2012.


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