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'Al-Lucent merger good for India'

Lucent, which gets 60 per cent of its revenue from US markets, has a strong customer base in India.

india Updated: Apr 07, 2006 11:37 IST

The proposed merger between US- based Lucent Technologies Inc, a CDMA telecom equipment provider, and French major Alcatel is a "strategic fit for India", a senior Lucent India executive said on Thursday.

"Alcatel has good presence in the Government sector.. Lucent is strong in the private sector. At macro level, the merger (proposed) is a strategic fit not just for India but globally as well", Abhay Savargaonkar, chief marketing officer, Lucent Technologies Hindustan Pvt Ltd said.

Lucent, which gets 60 per cent of its revenue from US markets, has a strong customer base in India including Reliance Infocomm, Tata Teleservices and BSNL. Lucent currently focuses on CDMA technology-based telecom equipment after exiting GSM business some time back.

Savargaonkar said the merger augurs well for both as from global market perspective, Lucent is strong in US markets while Alcatel is a strong player in Europe.

Lucent which has 40 per cent market share globally in CDMA equipment space has a strong portfolio of base stations, mobile switches, broadband network, optical products, soft switches (Next Generation Network across wireline and wireless as well as WCDMA and also HSDPA (next generation WCDMA).

Alacatel is the number one player in wireline space and also has a strong GSM presence, he said.

The transaction will build upon the complementary strengths of each company to create a global leader in the transformation of next-generation wireless, wireline and converged networks, according to their statements. The new group's revenues would be around 21 billion euros ($25.4 billion).

Alcatel is an old player in the Indian market and has a technology transfer agreement with public sector ITI and became the first one to manufacture digital switching equipment in the country. Half of India's fixed service lines are based on Alcatel technology.

Alcatel is also very strong in the areas of GSM infrastructure, transmission equipment, development and implementation of IN platform, EPABX, broadband equipment, space equipment and telecom infrastructure projects in railways, roads and aviation.

The company has research and development and engineering centres in Gurgaon and Chennai. The company has opened a Bell Labs centre in Bangalore, in addition to the existing software development centres in Bangalore and Hyderabad.

The transatlantic deal will see Alcatel shareholders owning around 60 per cent of the new company, with Lucent shareholders owning the remaining 40 per cent.