Lucent Brazil Contract With Telefonica Seen As Big Win
By MARGARITA PALATNIK
Dow Jones Newswires
NEW YORK -- In its first major deal in Brazil, Lucent Technologies'
(LU) has won a contract to supply Spain's Telefonica SA (TEF) units in
Brazil with wireless technology.
The deal is seen as a big win for the U.S. supplier as it links Lucent to a
dominant player in Latin American telecommunications. The deal also
strengthens the entrance of a U.S. backed technology into the developing
Latin American telecom sector.
Lucent said Tuesday that it will build a wireless network in metropolitan
Rio de Janeiro for up to one million users.
Although the companies didn't release the terms of the contract, market
observers place its value between $200 million and $500 million.
"Rio is the largest cellular market in Brazil," said Lucent spokesman
Virgilio Freire. "Telefonica handles three more companies in Brazil, and it
is the largest phone operator in Latin America," Freire added.
In the race to supply new Brazilian telephone companies after this year's
privatization of the former state-run monopoly and the recently awarded
rival cellular licenses,
Lucent is going against entrenched companies such as Sweden's Ericsson
(ERICY), Canada's Nortel (NT) and Japan's NEC Corp. (J.NEC). It has
bet big, setting up a manufacturing facility in Campinas, in the state of Sao
Paulo, with a staff of 600.
Analysts think Lucent is coming in with a splash.
"Strategically, (the contract) is pretty good, because Lucent hasn't been a
big supplier for Telefonica," said Chris Cona, vicepresident for telecom
project finance at SG (F.SGE).
And there may be more contracts coming soon. A spokesman at
Telefonica said that other deals may be announced for other cellular firms
controlled by the Spanish firm, which include companies in the states of
Bahia and Sergipe.
"Telefonica has a new partner in Lucent," said Telefonica spokesman Ivan
Macetti in Sao Paulo. "And it's highly likely that we'll close other deals."
|
