Alcatel denies plans to acquire Newbridge
Erik Schatzker
The Ottawa Citizen
NEW YORK -- Alcatel SA has no plans to acquire, take a stake in or resell
equipment for Newbridge Networks Corp., a senior official at Europe's
No. 2 phone-equipment maker said.
Jozef Cornu, executive assistant to Alcatel chairman Serge Tchuruk and chief
operating officer until last month, yesterday denied speculation that Alcatel is
planning to make an offer to buy all or part of Kanata-based telecommunications
equipment-maker Newbridge.
Mr. Cornu also said there are no negotiations about reselling equipment for
Newbridge under an original equipment manufacturer, or OEM, agreement.
"For the moment, there is nothing, not even on an OEM basis," Mr. Cornu said.
"We aren't formulating any proposal."
Newbridge officials weren't available yesterday to comment on Mr. Cornu's
remarks.
Speculation that Newbridge was going to be taken over by France's Alcatel or
Sweden's Ericsson AB built when the company said on Nov. 2 that profit in the
recent quarter would fall short of forecasts and its president quit.
Newbridge has denied the speculation, though said it held reseller talks with both
companies in the past.
Other companies mentioned as possible suitors are Finland's Nokia Oyj, Tellabs
Inc. and Cisco Systems Inc.
"Somebody will have to acquire the company," said Mr. Cornu, in New York to
speak to investors at the Warburg Dillon Read Telecom Conference.
"It's just a matter of who and when."
Alcatel could enhance its product line for phone companies with switches based
on asynchronous transfer more, or ATM, technology from Newbridge. It has
considered establishing a formal relationship with Newbridge before, Mr. Cornu
said.
On Friday, Newbridge spokesman John Lawlor denied published reports the
company was in discussions with Ericsson and Alcatel. He said the company has
complimentary technology and done deals with Ericsson.
"We have had discussions with Ericsson and Alcatel on business opportunities
but they have not included the takeover of Newbridge," he said.
He also denied published reports that Newbridge executives had been told to clear
their schedules in anticipation of a major event, possibly competing bids from
Alcatel and Ericsson.
In trading yesterday, Newbridge shares fell $1.90 to $29.50 on the Toronto
Stock Exchange. They have risen 39 per cent since Nov. 3, the day after the
profit warning sent the stock tumbling 23 per cent.
Alcatel's U.S. shares fell $1é16 to $35 13é16.
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