French Economy Minister Emmanuel Macron says the Nokia and Alcatel-Lucent tie up is a chance to create a “great European champion”.
PARIS, FRANCE (APRIL 14, 2015) (REUTERS) – French Economy Minister Emmanuel Macron gave his backing to Nokia’s plan to buy Alcatel-Lucent of France on Tuesday (April 14), saying it offered a chance to reconquer lost markets and create a European leader in telecoms equipment.
“This merger between Nokia and Alcatel-Lucent will allow the creation of a great European champion for devices but also the technology on mobile phones and landlines with the best of Nokia and Alcatel technologies. This great champion will precisely be the one that will be able to compete with Huawei and the large Chinese champions,” Macron said after a meeting between the heads of the two companies and President Francois Hollande.
The French government, which has a record of intervening in major take-over deals and is sensitive about job cuts and keeping a French foothold in strategic industries, publicly backed the plan. Macron hailed it as an opportunity to reconquer lost markets and said he had secured “clear undertakings” from Nokia that reassured him.
“The President of the Republic wanted to mark this wish by meeting the two CEOs today, the wish that the (French) state support this project, a project of reconquering for Alcatel-Lucent because its research and development is reputed as a world excellence. We will have a centre for excellence of research and development which will be developed in France, 5G technology will be developed in this new group,” Macron said.
He also pledged there would be no job cuts among the 6,000 Alcatel-Lucent employees in France, and said the combined group planned to base research and development operations in France.
“I think this new stage is that of reconquering for the French technology excellence, for the production and R&D sites in France but also to build a great European actor, that’s what we believe, that is what the President of the Republic wanted through this meeting today and it has the government’s support. So a positive message with the industrial project and a reassuring message for all of the employees,” the economy minister said.
Shares in Alcatel, a group worth about 11 billion euros based on Monday’s closing share price, rose about 16 percent. Shares in Nokia, worth about 29 billion euros, fell as much as 7 percent in morning trade before paring back losses to end down 3.6 percent.