The channel faced uncertainty last week as it received confirmation of a merger between networking vendor Ascend Communications and telecoms giant Lucent Technologies, worth about #20 billion.
As predicted in PC Dealer last week, the deal, which continues the frenzied spate of mergers and acquisitions between the IT and telecoms sectors, will see Ascend becoming part of the Lucent Group's recently formed broadband networking group. The networking vendor's Wan and ATM core switching products will be a bonus for Lucent, which lacks experience and penetration in this area.
Commenting on the effect on the channel, Peter Rigby, marketing director at CHS Electronics, said: 'It is likely Lucent will enter a period of review, finding ways to maximise the technology it has acquired. There won't be a change in dealings with the channel just yet. Telecoms companies generally sell direct, networking companies tend to sell through the channel and this will probably remain the same for the foreseeable future.'
The merger, which involves each Ascend share being converted into 0.825 Lucent shares, was agreed on 13 January by the boards of directors of both companies. The transaction is expected to be completed during Lucent's third fiscal quarter, which ends on 30 June.
Richard McGinn, chairman and chief executive of Lucent, said: 'We will be making further investments in this sector, both organically and through acquisitions.'
Commenting on why Ascend found the Lucent offer so attractive, Mory Ejabat, president and chief executive of Ascend, said: 'Lucent and Ascend already have a track record of teaming together and the Ascend ATM Core Switch is a critical component of Lucent's data networking portfolio.'
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