The deal fell apart after a year of negotiations with private
soon a takeover target
NEW YORK/HELSINKI (Reuters) ST Ericsson is preparing to unveil a major operations revamp within two weeks, placing the troubled mobile chip venture on track for a takeover by uk moncler outlet a peer or competitor that would create a formidable rival to cheap moncler sale Qualcomm Inc.
Hans Vestberg, president and chief executive of the Ericsson Group, holds a ST Ericsson 4G LTE chip during his keynote address at the 2012 International Consumer Electronics Show (CES) in Las Vegas, Nevada, January 11, 2012. REUTERS/Steve Marcus
ST Ericsson, a 50 50 joint venture of Sweden Ericsson and France STMicroelectronics, is seen as discount moncler jackets a asset for potential buyers. Those could include Advanced Micro Devices Inc, Nvidia Corp, Intel Corp and Texas Instruments Inc, three sources familiar with the situation told Reuters.
is the cheap moncler jackets only answer to Qualcomm, one of the moncler sale online sources said. the patent side, they are the one company that you go, makes sense.
Potential suitors moncler online store will likely drag out their courtship over a year or two, waiting for ST Ericsson to first show signs of a turnaround under new Chief Executive Didier Lamouche, a moncler outlet woodbury restructuring expert hired late last year.
Lamouche is due to unveil moncler womens jackets by the end of March a restructuring plan that is set to include site closures around the world and major layoffs to lower costs. The new strategy could also include seeking a partner for application processors.
In addition to modems ST Ericsson strength today smartphones use application processors that function in the same moncler outlet prices manner as a CPU on a computer, running software and moncler sale outlet graphics. These processors are increasingly incorporating dedicated graphics processors, or GPUs, as more video and moncler outlet sale graphically moncler usa intensive applications make their way onto smartphones.
Qualcomm topped the smartphone applications processor market in 2011, capturing cheap moncler jackets mens about a 50 percent revenue share and taking the long moncler sale held crown from Texas Instruments, according to research from Strategy Analytics.
ST Ericsson NovaThor chipsets offer one of the few integrated alternatives to moncler outlet Qualcomm market leading Snapdragon.
holy grail is to sell an integrated modem with an application processor into mainstream smartphones, said analyst John Jackson from research firm CCS Insight.
Meanwhile, consolidation has run rampant in the semiconductor sector, with Intel, Nvidia moncler outlet and Qualcomm among the major chip makers seeking to fill holes in their offering.
Intel acquired Infineon Technologies AG wireless solutions business to cheap moncler jackets womens make inroads into smartphones and mobile devices. Nvidia bought UK semiconductor company Icera, whose chips are used in datacards and USB sticks embedded directly in smartphones, tablets, and netbooks.
only a question of time either STMicro will buy out Ericsson from the venture or it will be sold to a third party, said Sami Sarkamies, an analyst at Nordea.
STMicro and Ericsson declined to comment, but both parents have said the venture is strategically important to them. ST Ericsson declined to comment.
CHALLENGES The current structure of ST Ericsson would pose monclerdownjacket several challenges for a potential buyer, the sources said. For example, the business is tightly linked to STMicro products, particularly for its upcoming technology, which analysts expect moncler outlet store to be a game changer moncler outlet online at the market top end.
The technology, which brings significant power savings, has been seen as too expensive for phones, but last month ST Ericsson promised to deliver FD SOI chipsets using STMicro technology in partnership with Soitec SA for manufacturing clients best moncler jackets to try out in smartphones this year.
And Ericsson holds most of the venture telecom patents and would be a tough deal negotiator, one of the sources uk moncler sale said.
When Ericsson exited from a similar 50 50 moncler uk outlet cellphone venture, Sony Ericsson, the deal gave Sony Corp access to Ericsson patents; but only a few patents were sold to Sony as part of the deal. Also, loss making Sony Ericsson was valued at roughly $3 billion in the deal. It had 2011 sales of $5.2 billion.
ST Ericsson has lost a total of $2 billion in its three years of operation as revenues from key clients Nokia and Sony Ericsson shrank over 70 percent during the same period.
they been struggling and looking at options. There is a lot of baggage that comes with the company, said Jon Erensen, an analyst at research firm Gartner.
Revenues in 2011 dropped to just $1.65 billion from pro forma level of $3.6 billion in 2008. ST Ericsson has also not been able to retain top talent, becoming a sort of revolving door among executives in past years.
Meanwhile, the venture has not been able to win enough new deals to compensate for the business lost from Nokia.
ST Ericsson was hit hard by the demise of Nokia Symbian smartphone platform, whose market share has shrunk from 50 percent to just 10 percent in a couple of years as Apple Inc and Google Inc stormed the market.
In February 2011, Nokia also decided to switch its software in favor of Microsoft Corp Windows Phone.
So far, Qualcomm has been the sole supplier of chipsets for Windows Phone, whose market share is cheap moncler coats mens only around 2 percent; but ST Ericsson has unveiled a design win for Nokia upcoming Windows 8 phones.
Although both STMicro and Ericsson have said they are committed to their venture, the sources said the companies cannot ignore the industry point, which has pushed rivals to look at alternatives for their ventures and assets.
Last year, Nokia and Siemens AG attempted to find a buyer for a stake in their ailing telecom equipment joint venture, Nokia Siemens Networks. The deal fell apart after a year of negotiations with private equity firms.
lot of these joint ventures have been in play. The problem with them is they can last forever, one of the sources said.
Reporting by Nadia Damouni in New York and Tarmo Virki in Helsinki; Additional reporting by Nicola Leske in New York and Leila Abboud in Paris; Editing by Gerald E. McCormick.
