Updated from 1:30 p.m. EDT

Beleaguered Ericsson ( ERICY) closed sharply lower today, leading the American depositary receipts of the once high-flying wireless equipment giant deeper into penny stock territory.

Ericsson ADRs appeared to have lost 27 cents, down 29.4% to 65 cents, a new 52-week low, based on news of the company's rights-offering registration was approved by the Securities and Exchange Commission. In fact the price has been adjusted with the assumption that all current shareholders will purchase the new shares at 41 cents a share. The lower opening price came after the SEC signed off on its $3.25 billion rights issue, amounting to 8 billion new shares for current shareholders.

"The stock's been under pressure regarding their ability to complete the rights offering," said W.R. Hambrecht wireless services analyst Peter Friedland. "They can use the capital to shore up their balance sheet."

Regardless, no amount of ink has been spared on the embattled wireless equipment arena. The industry is weathering one of its most brutal years, after carriers around the world have pulled back spending on new equipment in the face of declining growth in new subscribers. Just two days ago, Nokia ( NOK) announced it planned to shave 900 jobs in its poorly performing networks division, which competes directly with Ericsson.

In recent weeks, Ericsson's long-term corporate debt has been downgraded to junk status by both Standard & Poor's and Moody's in rapid succession. In a statement made last week, the company reassured investors that the rights offering is not at risk, assuming there are not cuts by two or more notches from the credit agencies, which observers say is unlikely.

A consortium of the largest investors have committed to about $1 billion of the offering, contingent on Ericsson being able to maintain a rating of BB by Standard & Poor's or below Ba3 by Moody's.

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