COLLAB distinguished with the APDC / Siemens Innovation Award

Alcatel and Lucent Technologies are in talks for an eventual merger

COLLAB distinguished with the APDC / Siemens Innovation Award

Alcatel and Lucent Technologies are in talks to merge operations and create a communications and equipment company, they announced in a joint communication. This is the second time that companies have discussed the possibility of merger, after in 2001 they established contacts in this direction for the first time. At the time, the talks were unsuccessful as Lucent did not want to relinquish a majority position in the company that resulted from the business.

The eventual merger is seen by the market as positive for the two companies as Alcatel has a strong position in Europe and Lucent is also a player important in the United States. The combination of both would allow to expand presence and weight worldwide and reinforce the capacity to compete with rivals such as Cisco or Ericsson, the world’s largest manufacturer of networks wireless.

Talks between the two telecommunications companies open the door to a new merger involving an American telecommunications company, which will follow operations such as the merger between SBC and AT&T for € 16 billion or, this year, the purchase of BellSouth by AT&T for $ 67 billion. In the same area, Cisco’s acquisition agreement with Scientific-Atlanta is also worth mentioning, in an operation that involves US $ 6.9 billion.

Remember that Lucent is the result of a spin off from AT&T in 1996. In the early years as an autonomous company, the technology performed well, but since then it has lost more than 90 percent of its market value, despite maintaining a top position in the American fixed telecommunications equipment market.

In the first quarter of this year alone, the company had a loss of 278 million dollars, with sales falling 21 million dollars. Today the company has a market value of around 12.6 billion dollars, while Alcatel is valued at 21.9 billion.

Related News:

2001-05-30 – Negotiations between Alcatel and Lucent end without agreement

2001-05-18 – Lucent may be purchased for PTE 9.1 billion