VG - Will Ericsson's $6.2 Billion Buyout Start a Consolidation Chain Reaction?
Swedish telecom equipment giant LM Ericsson (NASDAQ: ERIC) is buying cloud-based communications veteran Vonage (NASDAQ: VG) in a blockbuster $6.2 billion deal. This is a landmark event in many ways, stretching beyond its impact on Vonage and Ericsson.
Ericsson's offer amounts to an enterprise value of $6.2 billion. The all-cash payment of $21 per Vonage share will come from Ericsson's $7.22 billion in cash reserves. Vonage shareholders are going out on top as the final price tag represents a 28% premium to Friday's closing price.
Vonage's board of directors has given unanimous approval to Ericsson's offer. The deal is expected to close in the first half of 2022, subject to the usual array of shareholder approvals and regulatory reviews.
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Will Ericsson's $6.2 Billion Buyout Start a Consolidation Chain Reaction?