Alcatel and Lucent merge
Telco giants finally sign deal
Telephony vendors Alcatel and Lucent Technologies have confirmed plans to merge in what the two firms have called a "merger of equals".
The move will create a single company with combined revenue of $21bn and one of the largest global R&D capabilities in communications, the firms have claimed.
Serge Tchuruk, chairman of Alcatel, who will become non-executive chairman of the company, said: "This combination is about a strategic fit between two experienced and well-respected global communications leaders who together will become the global leader in convergence.
"A combined Alcatel and Lucent will be global in scale, have clear leadership in the areas that will define next-generation networks, boast one of the largest research and development capabilities focused on communications, and employ the largest and most experienced global services team in the industry," added Tchuruk.
Patricia Russo, chairman of Lucent, who will become chief executive of the combined company, said: "The strategic logic driving this transaction is compelling. The communications industry is at the beginning of a significant transformation of network technologies, applications and services - one that is projected to enable converged services across service-provider networks, enterprise networks and an array of personal devices.
"This presents extraordinary opportunities for our combined company to accelerate its growth. The combination creates a new industry competitor with the most comprehensive portfolio that will be poised to deliver significant benefits to customers, shareowners and employees," added Russo.
Jean-Charles Doineau, service infrastructure practice leader at research house Ovum, said: "This new company - let's call it "Lucatel" will benefit from having more financial capabilities to support the important R&D long term bets that a network equipment provider has to undertake.
"The agenda of the new company is pretty clear, and will certainly be focused on delivering operational efficiency gains at the very beginning. "Lucatel" plans to achieve $1.7bn of operational synergies after three years, 30 per cent of this being done in year one. One component of this programme will come from layoffs, which will reach approximately 10 per cent of the company workforce."