Sweden's Ericsson snaps up cloud firm Vonage in $6.2 billion deal

The deal, one of the largest in Ericsson's history, follows its $1.1 billion purchase of Cradlepoint last year which gave it access to tools that can connect devices using the so-called Internet of Things over a 4G or 5G network.

U.S-based Vonage makes Application Programming Interface (API), which helps different software communicate with each other.

"Vonage is complementary to what we have built in enterprise so far ... Cradlepoint was one of the big stepping stones as well in building an enterprise presence," Ericsson CFO Carl Mellander told Reuters.

Ericsson will pay $21 for each outstanding Vonage share, a 28% premium to Friday's closing price and a 34% premium to the average of the last 3 months, a price analysts said was high.

Ericsson shares fell 3.8% in early trade, on track for their worst day since July and the worst performer on the pan-European STOXX 600 index.

Article excerpted from Yahoo.