China Huaxin acquires Alcatel-Lucent Enterprise

The acquisition places Alcatel-Lucent Enterprise on a long term growth trajectory. The acquisition amounted to 202 million Euros in cash proceeds to Alcatel-Lucent.

Matthieu Destot, Vice-President of Sales for Asia Pacific (4th from right); Amit Bathla, Head of Marketing, APAC (first from right); celebrating the birth of their new company - together with their staff in Alcatel-Lucent Enterprise.

Matthieu Destot, Vice-President of Sales for Asia Pacific (4th from right); Amit Bathla, Head of Marketing, APAC (first from right); celebrating the birth of their new company – together with their staff in Alcatel-Lucent Enterprise.

Alcatel-Lucent (Euronext Paris and NYSE: ALU) has announced that it has successfully closed a transaction with China Huaxin Post & Telecommunication Economy Development Center (“China Huaxin”) for the divestment of its Enterprise division.

“As a ‘new’ company our core mission is to help companies transform the way people communicate, harnessing capabilities offered by ever smarter devices and new use models. We see success as creating long term value and customer relevancy by delivering business outcome to customers and partners through technology and business innovations,” commented Michel Emelianoff, Chief Executive Officer, Alcatel-Lucent Enterprise.

Following the divestment, Alcatel-Lucent will maintain a minority stake in a newly-formed holding company, incorporated in France.

Alcatel-Lucent Enterprise will also continue to work with Alcatel-Lucent on a privileged business relationship basis.

The transaction will now enable Alcatel-Lucent Enterprise to benefit from a strong and recognised investor, providing the means and resources necessary to strengthen its ambition including leadership positions in enterprise communications while accelerating investment in new areas of net growth.

Alcatel-Lucent Enterprise will continue to invest and innovate in the core markets where it is already recognized as an undisputed leader, namely enterprise communications and networking – while exploring new market opportunities in select, high-growth countries, vertical solutions and cloud services.

“With such a dedicated investor, we now have the ability to execute on our ambition to become an essential player in the enterprise communications market and still be a reference for innovation and user experience,” added Emelianoff.

At the same time, the business will work to define new opportunities aimed at growing the company into a leading player in next-generation enterprise communications, enabling an innovative shift from a pure technology-centric to outcome-based delivery model, capable of delivering measurable benefits from both an economical and human perspective for its partners and customers.

Alcatel-Lucent Enterprise will have its headquarters in Colombes near Paris, France, with over 2,700 employees worldwide and with operations in more than 80 countries.

Announcement in Singapore

Our writer Andrew Ng was at the announcement of the acquisition in the Equinox restaurant at Swissotel The Stamford in Singapore. He describes the anticipation of the occasion:

Local media at the press announcement in Singapore.

Local media at the press announcement in Singapore.

There was an air of excitement as Matthieu Destot, VP of Sales for APAC, mentioned that the announcement in Singapore would be done in conjunction with the global announcement in France.

“We are really excited by the acquisition of Alcatel-Lucent Enterprise. Our long-term investment approach will help Alcatel-Lucent Enterprise deliver on its ambition while enabling us to strengthen our strategic position in the enterprise communications arena,” said Yuan Xin, President, China Huaxin.

In the meantime, Damien Delard, VP SE Asia, shared with us Alcatel-Lucent Enterprise’s focus on unified access through wired and wireless solutions.

When clock struck 1.30pm in Singapore, Destot announced that with the close of ALUE’s sale to China Huaxin, it is now a debt-free entity to take on new challenges.

To deliver profitable growth, ALUE will need to provide unified access in both wired and wireless.

Software-defined Networking (SDN) is an area where it will invest for the future, upon seeing its potential to revolutionise the industry.

With a fresh start, ALUE is now committed to double its revenue within 5 years.

A new era for Alcatel-Lucent Enterprise.

A new era for Alcatel-Lucent Enterprise.

Currently ranked number 5 in the networking market, it needs to focus on selected areas to better deliver growth.

Destot emphasised that innovation is in ALUE’s DNA, and the 4 areas for APAC priorities, investment, and execution are: SMB (Small-medium Businesses), Demand Generation, Selected Verticals, and Cloud.

“Alcatel-Lucent Enterprise has very strong assets and a recognized leadership in many markets across the globe. We are looking forward to leveraging our investment capabilities and experience to bring this business to the next level, both in size and market outreach,” added Yuan

The 7 countries per their APAC focus are: Australia, Singapore, Malaysia, India, Indonesia, Philippines, and Taiwan.

Examples of investment and execution include joint investment with partners in Mumbai, and R&D with service providers in Taiwan.

There is also a shift in business model as ALUE become more of a software and services player rather than a hardware one.

As such, it will be interesting to watch ALUE for the coming years, as it transformed itself.

Below are more information on China Huaxin and Alcatel-Lucent Enterprise.

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