Alcatel-Lucent Advances on Report of Merger Talks With NokiaMarie Mawad and Cornelius Rahn
Alcatel-Lucent SA shares jumped as much as
8.2 percent after a German magazine reported that the French network-equipment maker is in merger talks with Finnish competitor Nokia Oyj.
The companies restarted discussions this fall, Manager Magazin reported, citing unidentified people. The companies are also considering cooperation, the magazine said. Representatives for Nokia and Alcatel-Lucent declined to comment.
In 2013, Nokia had evaluated options including a combination with Alcatel-Lucent’s wireless-networks business, a person with knowledge of the matter said at the time. A takeover would help Nokia add business in the U.S., allowing the Finnish company to close the gap with market leader Ericsson AB.
Alcatel-Lucent rose 7.9 percent to 2.87 euros at 2:08 p.m. in Paris, giving the company a market value of 8.1 billion euros ($10 billion). Nokia rose 2.9 percent to 6.51 euros in Helsinki, valuing the company at 24.4 billion euros.
Nokia, based in Espoo, Finland, sold its money-losing mobile-phone unit to Microsoft Corp. for about $7.5 billion this year to focus on wireless-network equipment, such as base stations and antennas. Chief Executive Officer Rajeev Suri, who took over in May, has cut jobs and is seeking to match investor expectations for profit gains as demand from phone carriers rises.
Alcatel-Lucent CEO Michel Combes is trying to focus on more profitable contracts while cutting jobs and selling assets to revive the Paris-based company after years of losses. Its shares have more than doubled since Combes took over last year.
European network-gear makers also face competition from China’s Huawei Technologies Co., whose lower-cost equipment has gained popularity among operators trying to curb costs as falling call and data prices weigh on their margins.
To continue reading this article you must be a Bloomberg Professional Service Subscriber.
If you believe that you may have received this message in error please let us know.