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Abstract

The trans-Atlantic merger of Alcatel and Lucent Technologies was touted as the biggest telecommunication deal when it was announced in 2006. The executives of both companies, Patricia Russo and Serge Tchuruk, displayed great optimism that the merger of equals would be able to offer an 'end to end solution' to its customers in a wide range of products. But two years down the line, the combined company struggled to deliver on its promise to attain synergies and cut costs to survive in the competitive telecommunication market. It failed to integrate and internalise its culture and products and lost a considerable market share to its competitors. Investors demanded the ousting of Russo and Tchuruk in the wake of consecutive losses, which the company posted since the merger. The case highlights the integration issues in the merger of the two companies that came from two different business cultures, along with the dynamics of the US telecommunication industry.
Location:
Industry:
Other setting(s):
1991-2008

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Abstract

The trans-Atlantic merger of Alcatel and Lucent Technologies was touted as the biggest telecommunication deal when it was announced in 2006. The executives of both companies, Patricia Russo and Serge Tchuruk, displayed great optimism that the merger of equals would be able to offer an 'end to end solution' to its customers in a wide range of products. But two years down the line, the combined company struggled to deliver on its promise to attain synergies and cut costs to survive in the competitive telecommunication market. It failed to integrate and internalise its culture and products and lost a considerable market share to its competitors. Investors demanded the ousting of Russo and Tchuruk in the wake of consecutive losses, which the company posted since the merger. The case highlights the integration issues in the merger of the two companies that came from two different business cultures, along with the dynamics of the US telecommunication industry.

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Location:
Industry:
Other setting(s):
1991-2008

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