Ericsson to acquire Technicolor's broadcast services division

The addition of Technicolor's Broadcast Services Division will allow Ericsson to become a leading provider in managed services for broadcasters
The acquisition will bring leading broadcast customers, about 900 highly skilled professionals and playout operations in France, UK and Netherlands
Closing of acquisition is expected around mid 2012
Purchase price of EUR 19 million and a potential earn-out based on 2015 revenues of the Broadcast Services activity of up to EUR 9 million.
Ericsson (NASDAQ:ERIC), the world leader in communication technologies and services, today announced that it has submitted a binding offer to acquire the Broadcast Services Division of Technicolor, a worldwide technology leader in the media and entertainment sector, headquartered in France. The closing of the acquisition is subject to relevant customary regulatory administrative approvals and consultations.

The acquisition will bring approximately 900 highly skilled professionals and playout operations located in France, UK and the Netherlands serving several leading broadcasters and will allow Ericsson to substantially increase its current broadcast operations in terms of channels managed and households reached.

The announced acquisition intention is in line with Ericsson's managed services strategy to broaden its capabilities in the broadcasting area.  Ericsson applies the managed services business model established in telecom operations, to improve efficiency, introduce innovation and increase revenues for the broadcasters.

"As the TV industry is undergoing fundamental changes with the transition to multi-platform, on-demand television, teaming up with a trusted partner enables broadcasters to meet the increasing commercial and technological complexity and competition in the TV market" says Magnus Mandersson, Executive Vice President and Head of Business Unit Global Services, Ericsson. "We combine our service and technology leadership with strategic investments in playout operations, broadcast capability and competence."

Frederic Rose, CEO of Technicolor, declared: "This transaction is consistent with Technicolor's strategy to focus on media monetization solutions, new growth businesses, and strengthen its balance sheet. For Ericsson, managed services are a core business and after completion of this divesture, the Broadcast Services activity will benefit from the company's know-how and global scale necessary to remain a key player in the worldwide Broadcast industry".

Ericsson is the leading provider of managed services for telecom operators and  has invested in processes and tools in this segment. With this acquisition Ericsson broadens its managed services for media broadcasters offering and confirms the company's long term ambition and commitment to the area.

Ericsson is the number one independent playout service provider in the Nordic countries, and has managed services agreements with broadcasters in Europe and Asia. After this acquisition Ericsson will be the leading independent playout service provider in Europe.

 Managed services is an example of Ericsson's continuous innovation - after creating this business model for telecom operators over 15 years ago, Ericsson has during the last years taken this successful business to other industries such as utilities and media.