InterDigital Surges on LG License

The wireless tech shop notches up a big patent deal.
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InterDigital

(IDCC) - Get Report

surged 21% early Tuesday after the wireless technology outfit struck a five-year license agreement with

LG Electronics

.

The license covers the sale of second-generation and third-generation wireless technology on the time division multiple access standard. LG is obligated to pay InterDigital three equal installments of $95 million in the first quarters of 2006, 2007, and 2008. At the end of the five-year term, LG will receive a paid-up license to sell single-mode GSM/GPRS/EDGE terminal units under the patents included under the license.

InterDigital said it is evaluating its accounting related to this agreement and will provide guidance at an appropriate time.

Early Tuesday, InterDigital rose $3.99 to $22.60.