Northern Telecom Expects Sales to Top Industry Rate (Update1)
Bloomberg News
September 29, 1998, 10:29 a.m. ET
Northern Telecom Expects Sales to Top Industry Rate (Update1)
(Adds 1997 sales growth and CEO comments, updates stock.)
Brampton, Ontario, Sept. 29 (Bloomberg) -- Northern Telecom
Ltd. Chief Executive John Roth expects the company's recent
acquisition of Bay Networks Inc. to help it gain market share and
exceed the industry's annual sales-growth rate of 14 percent.
The No. 2 seller of phone equipment in North America is
winning contracts from customers who want both Northern Telecom's
traditional voice products and Bay's equipment for directing data
on phone networks and the Internet, Roth said. Northern Telecom
is pushing to take advantage of demand for equipment that helps
customers carry more voice and data traffic on one network.
Northern Telecom bought Bay, the No. 3 computer-networking
company, less than a month ago for US$6.7 billion to move quickly
into the fast-growing data market. Roth expects gains in the data
and wireless equipment markets to help it boost sales faster than
the industry average of 14 percent over the next three years.
''The merger is working. The customers are buying,'' Roth
said in a statement before an annual meeting with analysts in New
York.
Northern Telecom shares rose 9/16 to 41 5/16 in early U.S.
trading.
Northern Telecom's revenue, excluding Bay, rose 20 percent
last year to US$15.45 billion. By comparison, sales at rival
Lucent Technologies Inc., the top seller of phone equipment in
North America, rose 13 percent to $26.36 billion in the fiscal
year ended Sept. 30, 1997.
Earlier this month, Lucent told analysts it expects sales to
rise to about $30 billion in the fiscal year ending Sept. 30.
Northern Telecom said Monday it will sell its products using
the brand name Nortel Networks to reflect the Bay purchase and
its new focus on data and other fast-growing markets.
--Andrew Brooks in the Princeton newsroom (609) 279- |
