Ericsson has topped Arris Group's bid for Norway's Tandberg Television offering $1.39 billion in an attempt to enter the television market. Tandberg's closing price Friday was 100.25 Krona; Arris's offer is for just 96 Krona a share versus Ericsson's which values Tandberg at 106 Krona a share. Ericsson believes a Tandberg acquisition would allow it entry into the fast-growing world of Internet TV. Tandberg is especially strong in the area of MPEG-4 compression technology essential for high quality online viewing. Ericsson has already purchased 11.7% of Tandberg and claims to have agreements from an additional 13% of shareholders it says will accept its offer. Tandberg responded this morning that it has received Ericsson's offer and needs to review it further.
Sources: Press Release - Ericsson Bid, Press Release - Tandberg Response, Wall Street Journal, Bloomberg
Commentary: Arris Group Snaps Up Tandberg TV, Becomes 'Triple-Play' Threat • Ericsson Buying Redback To Fend Off Cisco In IPTV Equipment • Ericsson Still Looks Safe and Sound, Despite Investor Overreaction - Barron's
Stocks/ETFs to watch: LM Ericsson (ERIC), Arris Group, Inc. (ARRS). Competitors: Alcatel-Lucent (ALU), Siemens (SI), Motorola (MOT), Nokia (NOK), Nortel (NT), Cisco (CSCO)
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