Telefonaktiebolaget LM Ericsson ("Ericsson") (NASDAQ: ERICY) today announces a recommended cash offer to the shareholders and holders of warrants in Netwise AB (publ) ("Netwise") to transfer all shares in and all warrants issued by Netwise to Ericsson the ("Offer"). Netwise's B shares are listed on Nya Marknaden in Sweden. Ericsson and Netwise has today an ongoing co-operation and see further possibilities in combining Netwise's cutting-edge IP-competence and applications for the enterprise segment with Ericsson's global presence.
 
Summary
  • For each share of series A and series B respectively in Netwise a cash amount of SEK 60 is offered.


  • For each warrant with respect to shares of series B in Netwise a cash amount of SEK 9.30 is offered.


  • Compared with the average latest share price paid for Netwise's shares of series B during the last ten trading days before announcement of the Offer of SEK 46.51, the Offer represents a premium of 29 per cent. Compared with the closing share price of Netwise's shares of series B the last trading day before the announcement of the Offer of SEK 49 per share, the Offer represents a premium of 22 per cent.


  • Netwise's Board of Directors unanimously recommends the Offer.


  • Shareholders in Netwise, together holding approximately 70 per cent of the share capital and 76 per cent of the voting rights in Netwise, have committed to accept the Offer and transfer all these shares in Netwise to Ericsson in accordance with the Offer, provided that no other person makes an offer that is more favorable for the shareholders.


  • Neither Ericsson nor its subsidiaries presently hold shares in Netwise.


  • The acceptance period for the Offer is expected to run from June 27, 2006 up to and including August 2, 2006. The estimated date for payment to shareholders is August 11, 2006.


  • Background and reasons for the Offer
    Ericsson sees a growing market for new advanced enterprise solutions based on IP, mobility and convergence. Applications that can unify these domains are crucial for the modern company's efficiency. Ericsson has already today a strong offering in this market and sees an opportunity to further strengthen this offering to the enterprise segment with Netwise's competence and solutions within the applications area.


    Urban Gillström, head of Ericsson's business unit Enterprise, says: "We see clear opportunities in combining Netwise's cutting-edge IP- competence and applications for the enterprise segment with our global presence. Ericsson and Netwise are already today partners and there are advantages to both parties in taking this next step."


    Yngve Andersson, Chairman of the Netwise Board of Directors, says: "Netwise is proud to have received this offer from Ericsson. We see this offer as a confirmation that we, with highly competent employees, have succeeded in developing competitive products and as well as position them in an international market even outside Scandinavia. Through Ericsson, Netwise now has the possibility to reach an international market even faster".
     
    The Offer
    For each share of series A and series B respectively in Netwise a cash amount of SEK 60 is offered. For each warrant with respect to shares of series B in Netwise a cash amount of SEK 9.30 is offered.


    No commission will be charged in the Offer.

    Compared with the average latest share price paid for Netwise's shares of series B at Nya Marknaden during the last ten trading days before announcement of the Offer of SEK 46.51, the Offer represents a premium of 29 per cent. Compared with the closing share price of Netwise's shares of series B the last trading day before the announcement of the Offer, of SEK 49 per share, the Offer represents a premium of 22 per cent.


    The total value of the Offer amounts to MSEK 300, based on 4,976,468 outstanding shares.


    Neither Ericsson nor its subsidiaries presently hold shares in Netwise.


    Ericsson will finance the Offer by available funds.


    Commitments to accept the Offer
    Shareholders of Netwise, together holding approximately 70 per cent of the share capital and 76 per cent of the voting rights in Netwise, have committed to accept the Offer and transfer all these shares in Netwise to Ericsson in accordance with the Offer, provided that no other person makes an offer that is more favorable for the shareholders.


    Recommendation from the Board of Directors of Netwise
    The Board of Directors of Netwise has unanimously resolved to recommend the company's shareholders and holders of warrants to accept the Offer.


    Conditions for the completion of the Offer
    Completion of the Offer is conditional upon:


    1. that the Offer is accepted to the extent that Ericsson becomes the owner of more than 90 per cent of the total number of shares in Netwise as regards shares issued at the time of completion of the Offer as well as after subscription of new shares under the warrants issued by Netwise. However, Ericsson reserves the right to completion of the Offer also at a lower level of acceptance;

    2. that with respect to the Offer and the acquisition, all necessary regulatory, governmental or similar permits, approvals, decisions and other clearances, including from competition authorities, are obtained, in each case on terms which are acceptable to Ericsson;

    3. that neither the Offer nor the acquisition of Netwise is wholly or partly prevented or materially adversely affected by an existing or anticipated legislation or other regulation, court decision, public authority decision, action or similar circumstance which is actual or could reasonably be anticipated in Sweden or abroad, or as a result of any other circumstance outside the control of Ericsson;

    4. that, before Ericsson announces that the Offer shall be completed, no circumstance occurs, of which Ericsson, where applicable, had no knowledge at the time of announcement of the Offer, that has a material adverse effect on Netwise operations, results, sales, liquidity, equity or financial position;

    5. that no other announces an offer to acquire shares in Netwise on terms more favorable for Netwise's shareholders than those applying to the Offer; and

    6. that Netwise does not take any actions that are normally likely to impair the conditions for completion of the Offer or the acquisition.


    Ericsson reserves the right to withdraw the Offer in the event that it is clear that any of the above conditions have not been fulfilled or cannot be fulfilled. However, with regard to the conditions 2, 3, 4 and 6 above such withdrawal will only be made if the non-fulfillment of the condition is of material importance to Ericsson's acquisition of Netwise.


    In addition, Ericsson reserves the right to waive, in whole or in part, one or more of the conditions in accordance with applicable laws and regulations.


    Indicative timetable


    Ericsson reserves the right to extend the acceptance period as well as to postpone the settlement date.


    The acquisition of Netwise requires clearances from the relevant competition authorities. The necessary clearances are expected to be obtained before the end of the acceptance period.


    Brief description of Ericsson
    The offer is made by Ericsson, the world's leading telecom supplier with operations in 140 countries. Ericsson supplies GSM, GPRS, EDGE, WCDMA and HSPA equipment and services, the technology family that connects more than 80 percent of the world's mobile subscribers. Ericsson has complete IP-solutions for upgrading fixed networks to accommodate broadband traffic with a strong position in Ethernet-based broadband access and has established itself as a top-tier global supplier. Ericsson has more than 100,000 enterprise customers and strong relationships with operators; creating powerful partnerships and enterprise solutions based on mobility, IP-enabled convergence and application integration.


    Please see www.ericsson.com for more information.


    Brief description of Netwise
    Netwise develops and markets software within the growing area of PM (Presence Management), team collaboration, integration of mobile phones, IP-telephony and multimedia. The concept provides customers with communications support to offer quick and correct services and offers a module based and switch board independent system for telephony. Netwise was founded 1992 and has today approximately 140 employees. There are around 2,000 customers in close to 20 countries. Netwise is today the leading supplier in North Europe and has subsidiaries in Sweden, Norway, Denmark, Finland, Germany and France.


    Please see www.netwise.se for more information.


    Applicable law and disputes
    The Offer shall be governed by Swedish law. The Courts of Sweden shall have exclusive jurisdiction over any disputes arising out of or in connection with the Offer and the City Court of Stockholm (Swedish: Stockholms tingsrätt) shall be the Court of first instance.


    This Offer is not being made (nor will any tender of shares be accepted from or on behalf of shareholders) in any jurisdiction in which the making of the Offer or the acceptance of any tender of shares would not be made in compliance with the laws of such jurisdiction. The Offer is not being made, directly or indirectly, in or into Australia, Canada, Japan or USA.


    Ericsson is shaping the future of Mobile and Broadband Internet communications through its continuous technology leadership. Providing innovative solutions in more than 140 countries, Ericsson is helping to create the most powerful communication companies in the world.
     
     
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