Under the terms of the agreement Ericsson will buy Marconi's network equipment business, while Marconi will keep its UK services business which has a turnover of £336m.
Taking pensions obligations into consideration, the deal values Marconi at £730m.
Frank Fabricius, managing vice president at analyst firm Gartner, said: "This is a good move for Ericsson. Most importantly it is gaining access to the optical transmission business at a time when that business is picking up.
"Ericsson has experience of integrating its products with Marconi's so it should not take long to integrate the businesses.
"This is a time of consolidation in the telecoms industry and this is the first really large consolidation."
Michael Philpott, principal analyst, and Jean-Charles Doineau, research director, at Ovum, published an analysis of the acquisition which stated that many commentators have misunderstood Ericsson's motives in sealing the deal.
"Of course, everyone will claim that Ericsson is stepping back into the fixed market with this deal at a time when fixed service providers have some cash back in their capital expenditure," the analysts said.
"But for a company like Ericsson, which is the UMTS and mobile core network champion of the new century, are we really talking about a step back into fixed networking? After all, Ericsson is one of the five big legacy switching vendors.
"The answer is less obvious than it might seem: it's all about network convergence. In buying some of Marconi's assets, Ericsson complements its product portfolio in areas that will be of high strategic importance for mobile operators and convergent network operators. And it is not only about the fixed business."
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