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Ericsson (ERIC - Analyst Report) last week closed the acquisition of Canada-based Telcocell, a consulting and systems integration company that specializes in Business Support Systems (BSS). The financial terms of the deal were not disclosed. The decision to acquire Telcocell was announced on Jul 23, 2013.   

Business support systems (BSS) are the components used by telephone operators or telecommunication service providers to provide its business operations to customers.

The acquisition perfectly complements Ericsson’s existing portfolio and will primarily strengthen Ericsson’s BSS transformation capabilities, particularly in North America. Ericsson is expected to benefit from Telcocell's consulting and systems integration expertise in converged charging, custom development, quality assurance and production support for BSS.

Telcocell is a leading provider of successful BSS solutions to customers in the communications industry. Its leading clients include companies such as Accenture plc (ACN - Analyst Report), Comcast Corporation and T-Mobile. According to the agreement, approximately 200 Telcocell’s employees and consultants based in Canada and U.S. will be joining Ericsson.  

Through this acquisition, Ericsson will also strengthen its capability in the area of Information and Communication Technology (ICT) to offer full transformation capabilities. Recently, Ericsson announced its plans to invest SEK 7 million ($1 billion) (1 SEK= $1.5110 as on Sep 2, 2013) investment to construct three global Information and Communication Technology centers (ICT) in the next five years. These ICT centers will primarily be supporting the R&D organization to develop and verify solutions, creating the foundation for the next generation technology and cloud-based services.

Headquartered in Stockholm, Sweden, Ericsson is a multinational company engaged in manufacturing and selling wireless infrastructure equipment to the telecom sector. It is a total network solutions provider, serving wireless and wireline operators, enterprises and consumers.

Ericsson currently has a Zacks Rank #3 (Hold). Another company operating in the same industry and worth mentioning is Ubiquiti Networks Inc. (UBNT - Analyst Report), carrying a Zacks Rank #1 (Strong Buy).  

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