Ericsson to Sell Loss-Making Internet of Things Business to Aeris Communications

By Dominic Chopping

STOCKHOLM--Ericsson AB said Wednesday that it will sell its loss-making internet of things business to California-based Aeris Communications.

The Swedish telecommunications-equipment company said the sale, which includes its IoT accelerator and connected vehicle cloud businesses, will put a stop to quarterly losses of around 250 million Swedish kronor ($24 million) that the businesses have been costing.

"Despite significant investments to address the fragmentation of the IoT market, Ericsson has only tapped into a limited part of the value chain, limiting the returns of such investments," Asa Tamsons, head of technologies & new businesses at Ericsson, said.

The divestment, related cost and other portfolio optimizations will lead to a negative one-time earnings before interest and tax impact of SEK1.1 billion in the fourth quarter of 2022, Ericsson said.

The deal is expected to close in the first quarter of 2023 and Ericsson said it plans to acquire a small stake in Aeris.

Financial terms of the sale weren't disclosed.

Write to Dominic Chopping at [e-mail]

(END) Dow Jones Newswires

December 07, 2022 06:26 ET (11:26 GMT)

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