Ericsson to Acquire Majority Stake in LHS Telekom

Press Release - June 6, 2007

Swedish telecom equipment giant, Ericsson, has agreed to pay €310 million (US$481 million) for a controlling interest in Germany’s LHS Telekom, an independent software vendor specializing in billing and customer care solutions.

“Operators are quickly moving towards convergent charging and billing solutions to enhance their relationship with consumers, improve cost efficiency and limit financial risk,” said Ericsson CEO, Carl-Henric Svanberg, in a statement. “Ericsson and LHS form a strong constellation of prepaid and postpaid solutions ready to immediately capture this opportunity.”

Ericsson will initially purchase 55.1% of the smaller company at a cost of €22.50 per share, and has committed to buying an additional 20% in the future, giving it a total stake of 75.1%.

Frankfurt-based LHS employs approximately 550 people, and generated sales of €71.6 million last year.