Swedish telecommunications giant Ericsson on Monday announced it will acquire the Holmdel-based global cloud communications provider Vonage for $6.2 billion, as the company aims to expand its presence in wireless enterprise and broaden its global offerings.
The cloud-based Vonage Communications Platform — which accounts for approximately 80% of Vonage’s current revenues — serves over 1.2 million customers and more than 1 million registered developers globally. Vonage was a pioneer of internet-based telephone service. It has evolved into a platform for application programming interfaces that allow different software applications to communicate with each other.
Rory Read, CEO of Vonage, says: “Ericsson and Vonage have a shared ambition to accelerate our long-term growth strategy. The convergence of the internet, mobility, the cloud and powerful 5G networks are forming the digital transformation and intelligent communications wave, which is driving a secular change in the way businesses operate. The combination of our two companies offers exciting opportunities for customers, partners, developers and team members to capture this next wave.
“We believe joining Ericsson is in the best interests of our shareholders and is a testament to Vonage’s leadership position in business cloud communications, our innovative product portfolio, and outstanding team.”
Vonage will become a wholly owned subsidiary of Ericsson and will continue to operate under its existing name. It will be reported as a separate segment in Ericsson accounts. The merger agreement is expected to complete in the first half of 2022, the company said in a statement.