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Alcatel-Lucent names Camus chairman, Verwaayen CEO
Tuesday September 2, 8:32 am ET
By Greg Keller, AP Business Writer
French telecom gear maker names former EADS, BT execs to replace company's top 2 leaders
PARIS (AP) -- Alcatel-Lucent on Tuesday named two executives from the aerospace and telecommunications industries as its new CEO and chairman, hoping to turn around the money-losing technology giant.
The world's largest manufacturer of fixed-line telecommunications gear appointed Ben Verwaayen, a former chief executive of BT Group, as its chief executive, and former EADS co-CEO Philippe Camus as its new chairman.
Verwaayen, who is Dutch, and Frenchman Camus replace the U.S. and French executives behind the $11.4 billion deal that combined France's Alcatel and U.S.-based Lucent two years ago that has yet to lead to a quarterly profit.
Verwaayen replaces CEO Patricia Russo effective immediately, while Camus will replace chairman Serge Tchuruk -- long Alcatel's top executive -- next month, Alcatel-Lucent said in a statement.
Russo and Tchuruk announced their resignations in July after Alcatel-Lucent reported a sixth consecutive quarter of losses.
Verwaayen has a long track record in the telecoms business, notably as CEO of BT from 2002 until June. Previously, he was the vice chairman of the board of Lucent Technologies Inc. -- before Alcatel acquired it.
Dresdner Kleinwort analyst Lawrence Sugarman said Verwaayen is well-respected in the industry and is "a good big picture thinker," pointing to his stewardship of the broadband Internet initiative at BT -- the former British Telecom.
"The UK went from being behind to being one of the most advanced European countries in terms of broadband penetration," Sugarman said by phone.
Camus, who was co-CEO of Airbus parent company EADS from 2000 to 2005, is now a partner in U.S. investment advisory firm Evercore Partners. He is also a co-managing partner of French media firm Lagardere SCA.
Alcatel-Lucent shares fell sharply early in the Paris stock exchange session, but in midday trading had recovered most of their losses and were down 1.4 percent at 4.24 euros (S$6.20).
Alcatel-Lucent shares have risen 8.4 percent since the company announced in July that Tchuruk and Russo were stepping down, but are still down 14 percent since the start of the year.
The company has reported losses in every quarter since Alcatel bought Lucent Technologies, a successor to AT&T's equipment-making arm, in November 2006. The new company is in the midst of a restructuring that foresees 16,500 job cuts.
In July, Alcatel-Lucent reported a net loss of 1.1 billion euros ($1.73 billion) for the second quarter after taking a goodwill write-down of 810 million euros ($1.3 billion) compared with a net loss of 586 million euros a year earlier.
The Alcatel-Lucent deal was designed to boost margins through cost and research and development savings, while improving the joint company's pricing power with telecom operators, its largest customers.
The combination was seen as creating the critical mass needed to compete with the likes of China's Huawei Technologies Co. and Ericsson AB of Sweden.
But intense competition in the telecoms industry has meant many of the savings have been used on discounts passed to customers, and analysts said Alcatel-Lucent hasn't coped as well as some of its competitors. |
