The telecom industry could have a big shake up as one of its major manufacturers, Alcatel-Lucent, is headed toward an acquisition by Nokia. Both sides have acknowledged that serious conversations have taken place. The possibility of an official announcement could come as quickly as this week.
Although Alcatel-Lucent has been working to focus on its more successful divisions, the 
idea of a full-blown merger would make the combination even more of a presence. Whether the acquisition is for the whole company or ends up just for ALU’s wireless division, it will make a significant impact in the market. Certainly competitors such as Ericsson, Cisco, and Huawei should take notice as the combination will be better suited to challenge them.
idea of a full-blown merger would make the combination even more of a presence. Whether the acquisition is for the whole company or ends up just for ALU’s wireless division, it will make a significant impact in the market. Certainly competitors such as Ericsson, Cisco, and Huawei should take notice as the combination will be better suited to challenge them.
In regards to their corporate structure, Nokia currently has over 61,000 employees while Alcatel-Lucent has over 52,000 employees. Obviously the past few years have already seen some changes at Alcatel-Lucent as they have been making many internal changes through cutting jobs and altering their business focus.
This acquisition is nothing to sneeze at for Nokia either. It would mark their largest acquisition at a price of approximately $13 billion. When combining the two companies, they would have a collaborative revenue stream of nearly $27 billion. That’s a lot of dollar signs flying around.
Nokia released a statement saying “In relation to recent media speculation Nokia and Alcatel-Lucent confirm that they are in advanced discussions with respect to a potential full combination, which would take the form of a public exchange offer by Nokia for Alcatel-Lucent. There can be no certainty at this stage that these discussions will result in any agreement or transaction.”
This is not the first time that Nokia and Alcatel-Lucent have been involved in 
merger discussions. The way negotiations are developing almost mirrors that of 2013. At the time, this was a way of increasing Nokia’s scale in wireless by focusing on its fast-growing IP routing and optical business. Conversations between the two sides have gone as far back as 2012.
merger discussions. The way negotiations are developing almost mirrors that of 2013. At the time, this was a way of increasing Nokia’s scale in wireless by focusing on its fast-growing IP routing and optical business. Conversations between the two sides have gone as far back as 2012.
Many times, these merger agreements can fall apart. Last year, the hot merger rumors swirled around T-Mobile and Sprint coming together. Eventually the discussions between the two folded. Although this may not be the case in this situation, nothing is certain until agreements are finalized. For now, the industry will cautiously watch over the situation until more details are released.
Launch 3 Telecom is a distributor of Alcatel-Lucent and Nokia equipment. For more information on the wireless equipment we have available, contact us at 877-878-9134 or email sales@launch3.net.
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