Ericsson today coughed up $1.1 billion to acquire Cradlepoint in a bid to bolster its position in the enterprise WAN market.

The Boise, Idaho-based company, a longstanding partner of Ericsson’s, will join the Swedish company as a subsidiary in its Business Area Technologies division and continue operating as Cradlepoint.

“Cradlepoint represents a critical segment that will become increasingly important in the 5G era and beyond,” Ericsson CEO Börje Ekholm said during a conference call.

He described the company as a “key global leader in the cellular-based wireless WAN market,” and expects Cradlepoint to deliver annual growth in wireless markets in a range of 25% to 30% for the next few years.

The telecommunications equipment vendor said Cradlepoint will complement its 5G enterprise portfolio with a particular focus on private networks, edge computing, and IoT.

The all-cash deal will negatively impact Ericsson’s operating margins by approximately 1% for the next two years, but it should contribute to positive gains in financial performance in 2022, according to Ericsson.

“We have led the way in bringing the power of cellular networks and technologies to enterprise and public sector customers — helping them connect beyond the limits of traditional wired WANs,” Cradlepoint CEO George Mulhern said in a statement. “Ericsson with its global 5G leadership is a great match for us and I am very excited to continue to scale and expand our business together.”

The company claims to be the first vendor to deliver a portfolio of 5G WAN edge products and services for the enterprise market. “Through Ericsson, we will have deep insights and greater access to the core LTE and 5G network, which will enable us to provide the end-to-end capabilities and quality of experience you need to confidently put 5G at the center of your next-generation WAN,” Mulhern wrote in a letter to customers.

Cradlepoint released its E300 series wireless WAN routers in April to assist IT teams supporting critical infrastructure for essential services amid the COVID-19 pandemic. The following month it released the E3000 WAN edge router for enterprise branch deployments, describing it as a 5G-ready “branch in a box,” capable of delivering application-aware SD-WAN, a firewall, analytics, and content filtering in a single unit.

An IDG report commissioned by Cradlepoint earlier this month concluded that 4G LTE or 5G is being used or under consideration as the primary WAN link for 78% of businesses surveyed, and 91% said they plan to adopt cellular connectivity soon.

Cradlepoint has more than 1,500 channel partners, and more than 1 million software-as-a-service (SaaS) subscriptions spread across more than 20,000 customers worldwide, according to Ericsson. Cradlepoint’s strength largely resides in North America, but Ericsson sees an “open opportunity” for growth in other regions.

The deal, which is expected to close before the end of this year, will bring about 650 Cradlepoint employees into Ericsson’s workforce. The company also operates a research and development center in Silicon Valley, California, and recently opened offices in the United Kingdom and Australia.