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Ericsson, Sony to increase stakes in Symbian

Posted: 25 Mar 2004 ?? ?Print Version ?Bookmark and Share

Keywords:ericsson? symbian? mobile phone operating system?

Ericsson Chief Executive Carl-Henric Svanberg is urging minority shareholders in Symbian to use their proportional preemption rights to stop Nokia gaining a majority stake in mobile phone operating system supplier.

The move follows the vote by Psion shareholders to approve the sale of its founding stake in Symbian to Nokia, which would increase the Finnish mobile phone manufacturer's stake to 63.3 percent.

Nokia offered to pay Psion nearly $250 million to increase its stake from 31.1 percent. But existing shareholders, Ericsson, Sony-Ericsson, Siemens, Samsung, and Panasonic hold preemption rights to increase their stakes proportionally and, thus, prevent Nokia from gaining a controlling stake.

Svanberg said Ericsson and its mobile phone partner, Sony, would increase their share in the consortium from their combined 19 percent to just over 27 percent.

He told the Financial Time Monday (March 22, 2004) that Nokia must be held to below 50 percent of Symbian stock, "otherwise it becomes a Nokia platform. If that happens there will be a gradual deterioration in the view of Symbian and other platforms could start to materialize".

Svanberg was referring mainly to Microsoft and Palm Source, and to a lesser extent Linux, whose OSs have already been selected by several mobile phone makers for next-generation phones. However, Symbian remains the dominant choice for phones or PDAs made by its stakeholders.

Svanberg said that if all the shareholders exercised their rights to buy a proportion of the stake Psion is selling, that would reduce Nokia's share to 46.7 percent, and thus be seen by independent users as an open OS.

At the 3GSM World Congress last month, Svanberg said Ericsson was still considering its options about whether to increase its stake. Nokia's CEO Jorma Ollila said his company had no problem with other shareholders exercising their preemption rights.

Other shareholders have been silent about whether they would increase their investments; nor are they required to declare their intentions until the preemption process begin - after regulators approve the sale to Nokia.

A Symbian spokeswoman would not comment about Ericsson's plan. "For us it's business as usual," she said.

- John Walko

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