LONDON Safran has signed a formal agreement with French venture capital firm Sofinnova Partners for the divestment of its mobile phone business. As part of the transaction Esmertec AG has signed an agreement with Sofinnova and Safran to acquire the mobile software platform activities of Sagem Mobiles.
Sagem Mobiles will continue to conduct its business until this transaction is completed, which should be by the end of 2008 at the latest.
Sofinnova will create a new mobile phone original design manufacturer company to develop and market products under other brand names, and on behalf of operators or other manufacturers, as well as for fashion, sports and luxury companies.
The new company will be named Sagem Wireless, and will be based in Cergy-Pontoise, near Paris. Sofinnova will hold a majority stake, while Safran will retain approximately 10 percent.
Pasquale Pistorio, former president and CEO of STMicroelectronics and former chairman of Telecom Italia, will become chairman of Sagem Wireless.
The new company will have about 310 employees (70 at Cergy-Pontoise and 240 at Ningbo, China), and will work with Esmertec and Purple Labs (Le Bourget du Lac, France) for the development of its software platforms. Sofinnova is a shareholder in these two companies. About 250 staff members from Sagem Mobiles’ R&D department will transfer to these two companies, and will stay at Cergy-Pontoise.
The new company will also subcontract mobile phone personalization and packaging operations to the Safran plant in Fougères.
Esmertec is a provider of Java in-device engines and mobile services platforms. The latest move is seen as providing growth in Esmertec’s business by strengthening customer relationships through additional products and services beyond Java in-device engines.
It should also provide an opportunity to further penetrate the high growth segment of voice-centric mobile phones with the acquisition of a platform already deployed in millions of mobile phones.It will provide a substantial extension of Esmertec's IP and patent base and enable the company's mid- and long-term strategy to extend its footprint in (mobile) software stacks by combining a mature software platform with a flexible, future proof Java middleware and application layer to serve the upcoming mobile convergence and consumer electronics devices industry.
Purple Labs offers a full Linux software suite to the wireless industry packaged as a customisable software solution or as part of full hardware and software reference design.