Subject category:
Strategy and General Management
Published by:
IBS Case Development Center
Length: 13 pages
Data source: Published sources
Abstract
On 2 April 2006, Alcatel, the French telecom equipment major and Lucent Technologies from the US announced a mega merger worth US$13.4 billion. The merger would form the biggest telecom equipment company in the world surpassing the market leader, Cisco and offer a complete portfolio in the telecom equipment industry, from equipment to service solutions for the networks. However, analysts are sceptical about the synergistic benefits due to concerns about cultural integration and product overlaps. The purpose of the case is to: (1) understand the new trends in the global telecom industry after the telecom bubble burst in 2000; (2) analyse the factors that prompted the merger, the potential synergies and pitfalls the merger might witness; and (3) discuss the effect of this mega merger on the global telecom industry and the possible consolidations that it might trigger among telecom equipment manufacturers and service providers.
About
Abstract
On 2 April 2006, Alcatel, the French telecom equipment major and Lucent Technologies from the US announced a mega merger worth US$13.4 billion. The merger would form the biggest telecom equipment company in the world surpassing the market leader, Cisco and offer a complete portfolio in the telecom equipment industry, from equipment to service solutions for the networks. However, analysts are sceptical about the synergistic benefits due to concerns about cultural integration and product overlaps. The purpose of the case is to: (1) understand the new trends in the global telecom industry after the telecom bubble burst in 2000; (2) analyse the factors that prompted the merger, the potential synergies and pitfalls the merger might witness; and (3) discuss the effect of this mega merger on the global telecom industry and the possible consolidations that it might trigger among telecom equipment manufacturers and service providers.