Grabbing Marconi’s assets

Ericsson is to acquire parts of Marconi's telecommunications business for £1.2 billion.

For the money, Ericsson will acquire assets representing about 75% of Marconi's turnover, including its optical networking business, broadband and fixed radio access network business, softswitch business, data networking equipment and services businesses, relevant telecommunications services activities and the Marconi trademark.

Marconi, which will be renamed telent plc, will have a new business focus as a leading services provider to telecommunications and enterprise customers, and will be Ericsson's preferred services partner in the UK.

Marconi will retain its UK Pension Plan and its net cash as at December 31, 2005 (which, as at September 30, 2005, amounted to £275 million).

Marconi is proposing to return a significant amount of the available proceeds from the transaction to its shareholders.