Ericsson has sold its local support business in Russia as it continues its departure from the country due to the invasion of Ukraine, stressing the sale does not hand over any hardware or software services to operators in Russia.
In a statement, the Swedish vendor detailed it had entered into an asset transfer agreement with a Russian company owned by former operational managers of Ericsson’s Russian subsidiary.
The sale includes the transfer of 40 Ericsson employees and assets and contracts which the vendor did not detail. Ericsson said the subsidiary “does not involve the export of hardware, software, or related services to mobile operators in Russia.”
Ericsson and Nokia announced they will cease doing business in Russia and shut down operations, following Russia beginning its invasion of Ukraine in February. Around 400 Ericsson staff have been let go as the exit process continues.
The vendor will continue to have a presence in Russia in 20223 to complete the wind-down and fulfil legal, contractual and administrative obligations.
Analysts speaking to Developing Telecoms predict Chinese vendors will fill in holes left by the two Nordic vendors.
The vendor also announced an agreement to extend independent compliance monitoring for one more year to June 2024 with the US Department of Justice (DOJ) and the Securities and Exchange Commission.
In 2019, the vendor entered into a deferred prosecution agreement with the DOJ to resolve an investigation into the vendor, after it admitted to shelling out millions in bribes and cooking the books across five countries between 2000 and 2016.
Ericsson president and CEO Borje Ekholm said: “This extension is consistent with our commitment to continuous improvement of Ericsson’s Ethics and Compliance program. We have made significant progress in changing our culture and implementing an enhanced compliance framework and system of internal controls, and we will use this additional time to ensure these improvements are ingrained in our organization, our daily interactions and the way we do business. We want to get this right and, to be a true industry leader, we have to conduct our business in the right way.”