Mobile phone producing giants, Nokia, set to buy out rivals Alcatel-lucent in a €15.6 billion (US$16.6 billion) merger to create what is perceived to be the world’s biggest supplier of mobile phone equipment.
Both companies have lost some luster due to the highly competitive market. this merger is set to create a .rival market to revive their market value and take on Swedish rivals, Errickson and fierce Chinese competition.
Telecom equipment maker Alcatel-Lucent’s Chief Executive Officer Michel Combes (L) and Nokia’s Chief Executive Rajeev Suri shake hands during a press conference in Paris to formalise the merger of the two companies. (Photo: AFP/Thomas Samson)The two firms have “highly complementary portfolios and geographies, with particular strength in the United States, China, Europe and Asia-Pacific,” Nokia’s statement said.
The new firm will go by the name Nokia, be based in Finland, and be run by Nokia’s current management team, it said.
in a bid to appease the french government which is worried about job loss in France if the merger happens, the two groups target to save 900 million pounds by 2019 without further job cuts. the french president, Francois Hollande, said he would support the deal only if it guarantees french jobs., and reasearch in France increases. he further stated that if these two conditions are upheld, the merger would be highly beneficial to Europe and the two countries concerned.
Jean-Marie Le Guen, a member of the Socialist government, told French radio that France was not “losing Alcatel” and reassured employees that the government would make sure they kept their jobs.
But “they must also know that if this merger didn’t happen, then maybe one day, Alcatel would not have been big enough to take on the international (market),” he said. “If you watch the trains go by, you stay on the platform.”
