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InvestmentsEricsson to buy cloud firm Vonage for $6.2 billion By Reuters

Ericsson to buy cloud firm Vonage for $6.2 billion By Reuters

© Reuters. FILE PHOTO: Ericsson brand is seen at its headquarters in Stockholm, Sweden June 14, 2018. REUTERS/Olof Swahnberg/File Photo

STOCKHOLM (Reuters) -Mobile telecoms gear maker Ericsson (BS:) mentioned on Monday it had agreed to buy cloud communications firm Vonage for $6.2 billion.

“The merger agreement was approved unanimously by the Board of Vonage,” Ericsson mentioned in a press release.

“The transaction builds upon Ericsson’s stated intent to expand globally in wireless enterprise, offering existing customers an increased share of a market valued at $700 billion by 2030.”

Vonage had gross sales of $1.4 billion within the 12-month interval to Sept. 30 2021 with a margin on adjusted earnings earlier than curiosity, tax and depreciation (EBITDA) of 14% and free money stream of $109 million.

The cloud-based Vonage Communications Platform serves over 120,000 prospects and a couple of million registered builders globally.

Ericsson mentioned it anticipated the deal to increase earnings per share – excluding non-cash amortization impacts – and free money stream from 2024 onwards.

The deal is anticipated to shut within the first half of 2022, topic to Vonage shareholder approval, regulatory approvals, and different situations.

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