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Alcatel-Lucent combine gears up to sail out of troubled times


Posted: 2008-09-04 23:15:40+05:30 IST
Updated: Sep 04, 2008 at 2315 hrs IST

: The new leaders of Alcatel-Lucent, the telecommunications company, vowed to push forward with the integration of the troubled French-American company, saying there was no possibility that the deal that created it would be unwound.

“We must deliver on the merger,” Ben Verwaayen, the former head of BT, who was appointed this week to succeed Patricia F Russo as chief executive, said at a meeting.

Acknowledging that there remained “a divided Alcatel-Lucent,” Verwaayen said, “We need to move quickly to become an integrated company.”

Alcatel-Lucent, one of the world’s largest suppliers of telecommunications equipment, was formed from the November 2006 combination of Lucent Technologies, based in Murray Hill, NJ, and Alcatel, based in Paris. The company said that the architects of the merger—the chief executive, Russo, and Serge Tchuruk, the chairman—would step down, following widespread dissatisfaction with their performance.

Alcatel-Lucent has cut 16,500 jobs and lost roughly $7 billion since the merger.

At the meeting, Verwaayen sought to reassure employees that he had not come to the job to carry out mass layoffs, saying, “I’m no fan of big reorganisations.”

But he noted that the company had to react to rapidly changing conditions. “We have to rethink very carefully where we put our investments in dollars, pounds and euros, and also where we put our best people,” he said.

Alcatel-Lucent also said that Philippe Camus, would take over October 1 as nonexecutive chairman. Camus, currently a managing partner of Lagardere SCA, a media company, was previously a co-chief executive at the parent of Airbus, the European Aeronautic Defense and Space Co.

Verwaayen, a Dutchman, speaks fluent French, in contrast to Russo, who was never entirely comfortable in the language. Alcatel-Lucent operates in 130 countries, and like many global enterprises, its language of business is English.

Even as Russo struggled to bring together the vastly different cultures of the two companies in a tough business climate, her difficulties were compounded by the fact that as the first woman to run a company listed on the CAC 40, she had to make her way in the clubby, male-dominated world where French business and politics overlap. Alcatel-Lucent’s headquarters is only a few blocks away from the Elysee presidential palace, and is across the street from the headquarters of President Nicholas Sarkozy’s party, the UMP.

Verwaayen brings his experience of having been a customer of Alcatel-Lucent, as well as its rivals Ericsson,

Nokia and Huawei. He said he would spend the next few months consulting...

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