Le Monde | • Updated | By
The rumor fantasize bankers for almost two years. It seems to finally materialize: Nokia announced Tuesday morning April 14 to discuss with the French-US supplier Alcatel Lucent to acquire the entire group
“Nokia and Alcatel. -Lucent confirmed it is in advanced discussions regarding a possible full merger, which would take the form of a Nokia public exchange offer on Alcatel-Lucent “, said the two groups in a statement.
According to our information, a final announcement of the two companies could come as early Wednesday, April 15 in the morning.
Informal initially discussions between Michel Combes, head of Alcatel and Rajeev president of Nokia, would have intensified in recent months to reach more concrete proposals between Monday, April 13 and Tuesday 14.
Nokia refloated its infrastructure business
Since the resale of his division “mobile terminals” at Microsoft in September 2013 and the acquisition by Siemens in their joint venture, Nokia has continued to refloat its equipment business for operators, yet very bad shape here just two years.
By focusing on mobile broadband technologies, Espoo Group, formerly largest mobile phone manufacturer in the world, managed to regain trust operators.
In the space of two years, its stock price has tripled to 8 euros. Today, Nokia’s market capitalization, EUR 30 billion, is nearly three times that of Alcatel (11 billion)
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According to press rumors, Nokia could also sell its GPS mapping Here division for $ 2 billion. Which could bring him extra cash in case of a redemption proposal partly in shares and partly in cash.
Compete with China’s Huawei and ZTE
If they marry, the two groups could be a European champion in the network equipment over 25 billion euros in turnover. A set of equivalent size to the industry leader, Sweden’s Ericsson, but also able to compete with Chinese manufacturers, such as Huawei or ZTE.
The new entity would employ some 120 000 people in the world and could benefit from Nokia’s expertise in mobile networks and Alcatel’s fixed.
For observers, such a linkage would allow both groups to reach the critical size that has done so much their lacking in recent years. This would allow the new entity to achieve economies of scale. And to propose the operators subject to competitive pressure more and more fierce, more competitive prices.
Group dormant
Arriving at the head Alcatel in April 2013, Michel Combes has been trying for almost two years, to straighten a group dormant. Formerly European flagship technology, Alcatel-Lucent has never recovered from the merger that gave birth in 2006. The American Lucent and the Alcatel French with too different corporate cultures, the Registry has simply not taken.
In addition, there was the group’s inability to monitor the uses and technologies in mobile telephony. Undisputed specialist in fixed Internet, Alcatel missed the turn 3G mobile internet. This prompted European operators to prefer Ericsson, Nokia and China’s Huawei.
Alcatel was also present on too many divisions, and in too many markets. And therefore unable to reach the famous critical size necessary to achieve economies of scale. Result, too greedy in cash, the equipment has arrived at the highest, burn up 800 million euros in cash per year.
To cope with an abysmal debt end 2012 ( at that time € 5.7 billion), the group had a pledge of his best assets: a portfolio of tens of thousands of patents in order to obtain a loan of 1.6 billion euros from banks Goldman Sachs and Credit Suisse
See also:. Alcatel-Lucent, the dream of return to equilibrium
Concerns for Job
This is to remedy this, Mr. Combes set up in October 2013, the “Shift” plan. It was to save 2 billion euros per year, releasing the group activities that do not relate fairly and eliminating 10,000 jobs worldwide, including 700 in France.
“Since his arrival, Michel Combes says he wants to save the company and now he wants to sell to a foreign group that produces the same” , is worried a union source. Employees have indeed led the massive job losses that Nokia has not hesitated to make in recent years. And fear the existence of duplication between the two groups.
“We wish that employment is preserved in France, pleads for his part, Pascal Guihéneuf, CFDT, and we will take all the necessary contacts for this to be the “.
The union regrets, moreover, that it is a French boss, who is about to give a national treasure to a Finnish group. Alcatel is still 8000 employees in France, spread throughout the country.
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