STMicroelectronics to exit Ericsson joint venture

Dec 10, 2012

Europe's largest chipmaker, STMicroelectronics NV, said Monday it plans to exit its money-losing joint venture ST-Ericsson, as it struggles to manage a downturn in global demand.

Swiss-based STMicroelectronics said it is negotiating "exit options" from ST-Ericsson, its joint venture with Swedish telecommunications company Ericsson. It has already started working on leaving the venture, and expects the move to be complete during next year's third quarter.

The semiconductor manufacturer, based in Geneva, announced the plans as part of a new strategic plan that hopes to revive its business. A global economic downturn has hurt sales at companies that make semiconductors for phones and other devices.

President and CEO Carlo Bozotti said STMicroelectronics would "continue to support ST-Ericsson" as part of its supply chain and technology partner.

Ericsson, which last year saw another of its joint ventures fall apart when it left the mobile handset operations it shared with Japan's Sony, said it stands by the business plan for ST-Ericsson.

"Ericsson continues to believe that the modem technology, which it originally contributed to the joint venture, has a strategic value for the wireless industry," it said. The company added that one of its key priorities is the market introduction of new LTE modems that "it is certain will be very competitive and needed in the market."

Ericsson, headquartered in Stockholm, said that for the time being it "will not speculate on the possible outcomes, timelines, and future ownership structures of ST-Ericsson."

Explore further: Why let your sales force influence product prices?

4 /5 (1 vote)
add to favorites email to friend print save as pdf

Related Stories

Sony Ericsson profits down in 3rd quarter

Oct 14, 2011

Mobile phone maker Sony Ericsson posted a break-even third quarter Friday - blaming the drop in earnings on higher taxes and lower margins - and announced that it is shifting its entire portfolio to smartphones next year.

Profits plunge in Q2 for Sweden's Ericsson

Jul 18, 2012

(AP) — Swedish wireless equipment maker LM Ericsson saw its second-quarter profits slashed to almost a third as sales of network infrastructure slowed in China and Russia and the company focused on the ...

Mobile phone maker Sony Ericsson posts Q1 profit

Apr 16, 2010

(AP) -- Mobile phone maker Sony Ericsson posted its first quarterly profit in nearly two years Friday, boosted by gains from high-end devices such as smartphones and cost cuts.

Recommended for you

Why let your sales force influence product prices?

34 minutes ago

From the outside, you might not notice the ongoing tension within many large businesses: the battle between salespeople, on the one hand, and marketers and product managers, on the other. Because the salespeople ...

Chinese smartphone makers win as market swells

17 hours ago

Chinese smartphone makers racked up big gains as the global market for Internet-linked handsets grew to record levels in the second quarter, International Data Corp said Tuesday.

User comments : 0