SANTA CLARA, Calif.—Sony Corp. said Thursday (Oct. 27) it signed a deal to acquire Telefonaktiebolaget LM Ericsson's 50 percent stake in the mobile handset joint venture between the two companies, Sony Ericsson, for 1.05 billion euro (about $1.49 billion)
Sony Ericsson will become a wholly owned subsidiary of Sony (Tokyo), the company said. The deal also includes a broad IP cross-licensing agreement and ownership of key patents, Sony said.
The London-based joint venture, established by the two companies in 2001, has been floundering for years, struggling to market smartphones that approximate the popularity of Apple Inc.'s iPhone or leading Android-based handsets. According to Sony, the company has about 11 percent market share in Android phones and 80 percent of its revenue is derived from smartphones.
Howard Stringer, Sony's president, chairman and CEO, said in a statement that the deal was a logical step for Sony and would enable the company to integrate smartphones into its product portfolio, giving customers seamless connectivity and access to content on a broader range of devices.
"We can more rapidly and more widely offer consumers smartphones, laptops, tablets and televisions that seamlessly connect with one another and open up new worlds of online entertainment," Stringer said.
Sony will enhance its focus on enabling connectivity for all devices, using its R&D and industry patent portfolio to realize "a truly connected world," Stringer said. "We can help people enjoy all our content—from movies to music and games—through our many devices, in a way no one else can," Stringer said.
The deal is expected to close in January 2012, Sony said. It remains subject to closing conditions, including regulatory approvals, the company said.