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Ericsson's next takeover target: UTStarcom or Harbor Networks?
21/11/2005 16:48

Jane Chen / Shanghai Daily news

Market analysts predict either UTStarcom Inc. or Harbor Networks Holdings Limited may be the next acquisition target for Ericsson AB, following the Swedish telecom giant's latest buy into UK-based Marconi Corporation Plc.
The forecast, cited by today's China Business News (CBN), came after Ericsson's President and chief executive officer, Carl-Henric Svanberg, revealed last Friday in South China's Guangzhou city that his company is engaged in talks concerning an acquisition in China. 
He didn't name the target, describing it as a business secret.
In October, Ericsson earmarked 1.2 billion pounds (US$2.1 billion) to acquire London-based Marconi's key telecom businesses, in line with its strategic aim of building strength in complementary markets.
It also derives from this strategy that Ericsson needs a unit in China to supplement its data-networking business here, according to analyst Cui Xiaolong with Analysys International.
"Harbor Networks has the advantage in terms of its data product, while UTStarcom has a complete marketing network," he added.
In fact, both companies are in financial trouble.
Sources close to UTStarcom said the Nasdaq-listed company is seeking overseas alliances for some of its businesses and Harbor Networks, hard-pressed by its old rival Huawei Technologies Co Ltd, is thirsty for a cash injection. 
Harbor Networks has reportedly offered itself for sale in talks with Germany's Siemens AG, but both parties denied the report.
Siemens' mobile networking president Christoph Caselitz disclosed that his company is considering operating more research and development centers in China in the coming years and may make acquisitions at an appropriate time, the CBN report said.