STMicroelectronics to Exit Joint Venture With Ericsson

STMicroelectronics (NYSE: STM  ) is exiting ST-Ericsson, its chip-making joint venture with Swedish telecom equipment supplier Ericsson (NASDAQ: ERIC  ) , both companies announced today. STMicroelectronics said "the disengagement process has started" and the transition is expected to end during the third quarter of 2013.

ST-Ericsson is loss-making, The Wall Street Journal reports, and STMicroelectronics' exit from it is part of a broader strategy to become a leaner and more profitable firm. The company has posted a net loss in its last four quarters, the most recent of which saw a shortfall of 382 million euros ($494 million).

Ericsson, meanwhile, said it "will not speculate on the possible outcomes, timelines, and future ownership structures of ST-Ericsson." The company said it would work with STMicroelectronics to "find a suitable strategic solution" for the joint venture. STMicroelectronics said it would "continue to support ST-Ericsson as their supply-chain partner, advanced process-technology partner and application-processor IP provider."

linkST-Ericsson was established in February 2009 and generated sales of $1.7 billion in 2011.

Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2146715, ~/Articles/ArticleHandler.aspx, 10/26/2016 12:10:01 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 2 hours ago Sponsored by:
DOW 18,169.27 -53.76 -0.30%
S&P 500 2,143.16 -8.17 -0.38%
NASD 5,283.40 -26.43 -0.50%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

10/25/2016 4:00 PM
ERIC $5.02 Down -0.08 -1.57%
Telefonaktiebolage… CAPS Rating: **
STM $7.93 Down -0.19 -2.34%
STMicroelectronics CAPS Rating: ****