Ericsson CEO Signals U.S. Ownership Would Not Be Appropriate
Ericsson CEO Signals U.S. Ownership Would Not Be Appropriate
(Bloomberg) -- Borje Ekholm, the chief executive of Ericsson AB, suggested he wouldn’t feel comfortable if the U.S. took a controlling stake in his company.
The CEO of the Swedish telecom giant talked down speculation that a change of ownership might be on the cards, after Attorney General William Barr earlier this year said the U.S. should consider investing in Ericsson or its Finnish rival Nokia Oyj to prevent China from gaining dominance over 5G technology.
“We have a fairly good ownership structure and we should be able to push ahead on that,” Ekholm said in an interview with Bloomberg Television on Wednesday. “When you operate outside of government control, you’re the most innovative and efficient.”
Ericsson’s largest shareholder, Cevian Capital, has urged the company to explore the idea of U.S. ownership. But Ekholm signaled he’d rather steer clear of any geopolitical struggle between the U.S. and China.
The Trump administration has already banned China’s Huawei Technologies Co. from its market for telecom equipment, as part of an effort to curb its presence in 5G networks globally.
“Being linked too much to one country can have other implications,” Ekholm said. “As long as the owners think this is a good ownership structure, I, as a manager, think it’s great.”
Ekholm also warned politicians in the European Union to steer clear of national ownership and intervention, as the bloc looks into preventing some foreign deals.
“I think it would be healthier to not have them involved,“ Ekholm said. Instead, policy makers should “create a good investment climate for the companies. And here I don’t think the political system is doing European enterprises any big favor.”
©2020 Bloomberg L.P.
With assistance from Bloomberg