Alcatel-Lucent appoints Michel Combes as CEO
Troubled telecoms vendor Alcatel-Lucent has selected Michel Combes, the former head of Vodafone Europe, as CEO.
Combes, who has also served as CFO at France Telecom, was set to take up the reins of Vivendi’s French telecoms unit, SFR, last year but the move was cancelled after a management reshuffle at Vivendi.
He replaces Ben Verwaayen, who led Alcatel for five years but failed to deliver a turnaround in the company’s fortunes, despite a positive end to FY2011.
In its recent 2012 financial results Alcatel recorded a net loss of €1.37 billion prompting Verwaayen’s resignation.
“Alcatel-Lucent is an unrivalled technology leader in the telecommunications industry with an immense array of talent and capabilities in R&D facing major challenges. This is a company I know well and I look forward to succeeding Ben, working with the key international customers, and driving the business into sustained profitability for its customers, employees and shareholders,” said Combes.
Alcatel-Lucent shares opened over 3% higher following the announcement.
Market watchers suggest Combes is a good choice for the company given his experience leading Vodafone’s European operations through the financial crisis and his familiarity with the French government.
Combes will inherit a cost reduction plan that includes 5,000 job cuts, as well as €2 billion of loan financing. He also faces difficult market conditions with reduced telco spending in Europe and competition from Chinese rivals Huawei and ZTE.