Ericsson has won all of Nortel Networks’ CDMA Business and LTE Access assets as a result of a $1.13 billion auction. Also as part of the agreement, which is subject to court and customary regulatory approvals, a minimum of 2500 Nortel employees supporting CDMA Business and LTE Access will receive offers of employment from Ericsson.

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The agreement includes important CDMA contracts with North American operators such as Verizon, Sprint, U.S. Cellular, Bell Canada, and Leap, as well as Long-Term Evolution (LTE) assets, certain patents, and patent licenses relating to CDMA and LTE. The deal, which Nortel and Ericsson will work to close by the end of this year, also significantly increases Ericsson’s North American LTE footprint.

“Acquiring Nortel’s North American CDMA business allows us to serve this important region better as we build relationships for the future migration to LTE,” said Carl-Henric Svanberg, Ericsson president and CEO. “Furthermore, by adding some 2500 highly skilled employees, of which about 400 are focused on LTE research and development, Ericsson reinforces and expands a long-term commitment to North America.”

Nortel’s North American CDMA operations generated approximately $2.0 billion in 2009. Going forward, research and development costs are expected to be relatively low in CDMA compared to other technologies. Ericsson’s North American business generated $2.7 billion in sales in 2008, mainly from GSM and WCDMA equipment and associated services.

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