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E2 Business combinations | 12 Months Ended
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Dec. 31, 2021
Disclosure of detailed information about business combination [abstract] |
E2 Business combinations |
|  | Business combinations
Acquisitions and divestments Acquisitions
Acquisitions 2019–2021 |  |  |  |  |  |  |  |  |
|  | 2021 |  |  | 2020 |  |  | 2019 |
Consideration |  |  |  |  |  |  |  |  |  |  |  |
Cash and cash equivalents |  |  | 256 |  |  |  | 9,534 |  |  |  | 1,815 |
Others |  |  | — |  |  |  | 314 |  |  |  | 142 |
Total consideration |  |  | 256 |  |  |  | 9,848 |  |  |  | 1,957 |
Net assets (liabilities) acquired |  |  |  |  |  |  |  |  |  |  |  |
Cash and cash equivalents |  |  | — |  |  |  | 314 |  |  |  | 142 |
Property, plant and equipment |  |  | 1 |  |  |  | 55 |  |  |  | 353 |
Right-of-use of assets |  |  | — |  |  |  | 126 |  |  |  | — |
Intangible assets |  |  | (95) |  |  |  | 3,583 |  |  |  | 497 |
Investments in associates |  |  | — |  |  |  | 167 |  |  |  | 101 |
Other assets |  |  | 21 |  |  |  | 1,292 |  |  |  | 1,357 |
Provisions, incl. post-employment benefits |  |  | — |  |  |  | (16) |  |  |  | (102) |
Other liabilities |  |  | (348) |  |  |  | (2,781) |  |  |  | (743) |
Total identifiable net assets (liabilities) |  |  | (421) |  |  |  | 2,740 |  |  |  | 1,605 |
Costs recognized in net income |  |  | — |  |  |  | — |  |  |  | 153 |
Goodwill |  |  | 677 |  |  |  | 7,108 |  |  |  | 199 |
Total |  |  | 256 |  |  |  | 9,848 |  |  |  | 1,957 |
Acquisition-related costs 1) |  |  | 11 |  |  |  | 92 |  |  |  | 85 |
1) | Acquisition-related costs are included in Selling and administrative expenses in the consolidated income statement.
In 2021, Ericsson made acquisitions with a negative cash flow effect amounting to SEK 256 (9,534) million. The acquisitions presented below are not material, but the Company gives the information to provide the reader a summarized view of the content of the acquisitions made. The acquisitions consist primarily of: Cradlepoint : On November 1, 2020, the Company acquired all of the shares in Cradlepoint Inc. (purchase price of SEK 9.5 billion), a US-based market leader in Wireless Edge WAN 4G and 5G Enterprise solutions. The investment is key to Ericsson’s ongoing strategy of capturing market share in the rapidly expanding 5G Enterprise space. Cradlepoint complements Ericsson’s existing 5G Enterprise portfolio which includes Dedicated Networks and a global IoT platform. Goodwill in this transaction represents future customers, future technology and synergies to the sales channels and commercial model applied by Cradlepoint and is not expected to be deductible for tax purposes. The preliminary purchase price allocation of Cradlepoint made in 2020 was finalized during 2021. The main change between the provisional and final fair values in the balance sheet is an increase in goodwill of SEK 0.48 billion to SEK 7.5 billion with a corresponding increase of deferred revenues with SEK 0.35 billion and a decrease of intangibles with SEK 0.13 billion. This resulted in a positive impact in the income statement of SEK 0.1 billion in 2021. Axonix: On March 31, 2021, the Company acquired assets from Axonix, a UK based mobile-first programmatic advertising exchange. The acquisition will strengthen the Company’s supply chain in the market. Balances to facilitate the Purchase price allocation are final. Quortus: On November 17, 2021, the Company acquired selected assets, including 29 employees, from Quortus, a UK-based company with expertise in enterprise 4G/5G technology. The acquisition augments the Company’s offering with richer 4G/5G networking features across its portfolio of enterprise products. Balances to facilitate the Purchase price allocation are final. In order to finalize a Purchase price allocation all relevant information needs to be in place. Examples of such information are final consideration and final opening balances, they may remain preliminary for a period of time due to for example adjustments of working capital, tax items or decisions from local authorities. Divestments
Divestments 2019–2021 |  |  |  |  |  |  |  |  |
|  | 2021 |  |  | 2020 |  |  | 2019 |
Proceeds |  |  |  |  |  |  |  |  |  |  |  |
Cash and cash equivalents |  |  | 273 |  |  |  | 4 |  |  |  | 360 |
Shares in associated companies |  |  | — |  |  |  | — |  |  |  | 1,209 |
Total Proceeds |  |  | 273 |  |  |  | 4 |  |  |  | 1,569 |
Net assets disposed of |  |  |  |  |  |  |  |  |  |  |  |
Property, plant and equipment |  |  | 26 |  |  |  | 1 |  |  |  | 171 |
Right-of-use assets |  |  | 7 |  |  |  | 1 |  |  |  | 20 |
Investments in associates |  |  | — |  |  |  | — |  |  |  | 5 |
Intangible assets |  |  | — |  |  |  | 48 |  |  |  | 820 |
Goodwill |  |  | (48) |  |  |  | 4 |  |  |  | — |
Other assets |  |  | 51 |  |  |  | 83 |  |  |  | 96 |
Provisions, incl. post-employment benefits |  |  | (30) |  |  |  | (1) |  |  |  | 244 |
Other liabilities |  |  | 36 |  |  |  | 6 |  |  |  | (774) |
Total net assets |  |  | 42 |  |  |  | 142 |  |  |  | 582 |
Net gains/losses from divestments |  |  | 231 |  |  |  | (138) |  |  |  | 987 |
Shares in associated companies |  |  | — |  |  |  | — |  |  |  | (1,209) |
Cash flow effect |  |  | 273 |  |  |  | 4 |  |  |  | 360 |
In 2021, the Company made divestments with a cash flow effect amounting to SEK 273 (4) million. Net gains/losses from the divestments are presented on Other operating income in the Income statement, see note B4 “Other operating income and expenses” for more information. The divestments consist primarily of a data centre business located in the Netherlands in November 2021. For more information, see also note H3 “Statement of cash flow.”
Acquisitions 2019–2021 |  |  |  |
Company |  | Description |  | Transaction date
Quortus |  | A UK based mobile core software company with expertise in enterprise 4G/5G technology. |  | Nov 2021
Axonix |  | A UK based mobile-first programmatic advertising exchange. |  | Mar 2021
Cradlepoint |  | A US company providing Wireless WAN Edge 4G and 5G solutions for the enterprise market. |  | Nov 2020
Genaker |  | A Spain provider of Mission Critical Push-to-talk (MC-PTT) solutions. |  | Mar 2020
ST-Ericsson |  | The remaining shares were acquired in ST-Ericsson (previously a joint venture). |  | Dec 2019
Kathrein |  | A German provider of antenna and filter technologies. |  | Oct 2019
CSF |  | A US based company related to the iconectiv business. |  | Aug 2019
Divestments 2019–2021 |  |  |  |
Company |  | Description |  | Transaction date
Data center |  | A data center business located in the Netherlands. |  | Nov 2021
MediaKind |  | A divestment of 51% of its MediaKind business. |  | Feb 2019

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