Alcatel-
Alcatel-Lucent Submarine Networks (ASN) will remain part of Alcatel-Lucent (EPA:ALU) and thus become part of Nokia (HEL:NOKIA), which is close to completing its takeover of the French vendor.
Alcatel-Lucent had previously said it would seek a private sale, IPO or spin-off its undersea cable business, which analysts have valued in the region of US$1bn.
Alcatel-Lucent announced it was planning an IPO for the business in summer 2014 “in order to finance the reinforcement of its leadership in telecom submarine systems and its diversification into the oil and gas market, to increase its visibility and to optimise capital allocation”.
It was part of a wider push to dispose of non-core assets.
After Nokia agreed to buy Alcatel-Lucent in April – in a €15.6bn (US$16.6bn) all-stock merger – the Paris-based group widened its options to a spin-off and straight sale, and said it was still pursuing possibilities for ASN in its Q2 results delivered on 31 July.
In a statement, Alcatel-Lucent said the decision to retain ASN had no impact on the Nokia transaction.
ASN, headquartered in Villarceaux, France, is the largest provider of turn-key subsea cable systems worldwide with more than 575,000km of fibre-optic cable deployed, and a fleet of seven ships to lay the infrastructure. ASN will continue to be operated as a separate entity, leaving the door open for strategic options to be pursued further down the line.
Nokia executives dominate leadership of merged entity
Meanwhile, Nokia has unveiled the operational structure and management of the combined Nokia-Alcatel-Lucent, which its shareholders will hold the majority of, once the merger completes.
Nokia’s CFO Timo Ihamuotila would become CFO of the merged group, responsible for finance and investor relations, M&A execution and treasury.
Elsewhere, Marc Rouanne, Nokia’s EVP of mobile broadband within Nokia Networks, would serve as chief innovation and operating officer, and Kathrin Buvac, vice president of corporate strategy at Nokia Networks, would be promoted to chief strategy office of the company.
Nokia said Buvac would be responsible for setting “corporate strategy and long-term strategic direction, market and competitor intelligence, corporate development – including the prioritisation of M&A targets across the company, in conjunction with the CFO – and strategic partnerships at group level”.
Post-merger, Alcatel-Lucent will be integrated into Nokia’s networks business, which the Finnish vendor operates separately from Nokia Technologies. Nokia Networks would then be split into four business groups: mobile networks, fixed networks, applications & analytics and IP/optical networks. ASN will operate outside of that structure.
