Ericsson’s $6.2 billion takeover of Vonage delayed over US review


OSLO/STOCKHOLM, June 28 (Reuters) – Ericsson said on Tuesday the closing of its $6.2 billion acquisition of Vonage had been postponed until late July from the first half due to an ongoing investigation. course by a US national security panel.

The Swedish telecoms equipment maker agreed to buy cloud communications company Vonage for cash in November, as part of its push to expand its 5G portfolio.

But, since then, Ericsson has faced a corruption scandal in Iraq that has led the US Department of Justice and the Securities and Exchange Commission (SEC) to open investigations against the company.

Several analysts had estimated that the investigations could either delay the approval of the agreement by the American regulators, or even derail it.

The deal is currently being reviewed by the Committee on Foreign Investments in the United States (CFIUS), an interagency group that reviews foreign investments for potential national security risks.

“As the committee’s review is ongoing, we cannot comment on any details,” an Ericsson spokesperson said.

Ericsson also said the two companies are working closely with CFIUS and the deal has met all other required foreign and U.S. regulatory approval requirements. The deal is one of the largest in Ericsson’s history.

(Reporting by Terje Solsvik and Supantha Mukherjee; Editing by Uttaresh.V)