STOCKHOLM: Ericsson AB, the world’s largest maker of wireless network gear, made a 9.8 billion-kroner (Rs7.06 crore) cash bid for Norway’s Tandberg Television ASA to top a rival offer by Arris Group Inc.
Ericsson is bidding 106 Norwegian kroner for each share of Lysaker-based Tandberg TV, the company said on 26 February. Arris on 15 January offered 96 kroner in cash and stock. Tandberg Television’s stock jumped 11%.
The suitors of Tandberg Television, whose shareholders have approved the Arris offer, would gain more than a quarter of the global market for video processing. The company’s products have gained popularity as cable network operators including Royal KPN NV invest more in broadcasting equipment as digital technology replaces analog networks.
“It’s a new technology and with the consolidation of networks, carriers need to be able to offer new services so that they can keep their larger clients happy,” said Michiel Plakman of Rotterdam-based Robeco Group, which manages over $74 billion (Rs3,26,443 crore) in equities including Ericsson shares.
Tandberg Television shares rose as much as 11.25 kroner to 111.5 kroner in Oslo. Ericsson shares rose 1 kronor or 0.4%, to 26 kronor.
On 26 February, Ericsson said that it already owns 11.7% of Tandberg Television stock, and will expand its customer base to include cable and satellite operators as well as broadcasters with the purchase. Ericsson is also a partner in the Sony Ericsson Mobile Communications Ltd mobile phone venture.