Ericsson Shows Interest in Intel's Network Spin-Off

Ericsson is in talks with Intel over taking a minority stake in the US company’s planned network and edge spin-off. Discussions are ongoing and may not materialize in a deal. Intel was in discussions with other companies over investing in the unit.

Intel did not name Ericsson specifically but said it had started the process of identifying strategic investors in the business. The future of Intel’s NEX group has been the subject of media speculation for months. Last week, news publication CRN published details of a memo apparently sent by Intel to customers confirming the unit would be spun off into a standalone business.

Intel’s NEX division makes chips for networking equipment used in the telecoms sector and counts Ericsson among its customers. Repeated media reports related to the division come as Intel moves to slash costs and streamline its business. As part of the push, it has already agreed a deal to sell a $4.4 billion stake in programmable chip business Altera to Silver Lake and made staff cuts.