Alcatel-Lucent announces financial restructuring
19 June 2013 |
Alcatel-Lucent has today announced a cost cutting restructuring plan to reduce costs by €1 billion and raise €1 billion via asset sales.
The company said it is trying to reverse the decline of losses suffered in recent years.
Named ‘The Shift Plan’, the strategy includes an increased focus on IP networking and high-speed broadband, with 85% of the company’s R&D margin to be spent on these areas.
Michael Combes, the company’s recently appointed CEO, said that Alcatel-Lucent would also sell unspecified assets totalling over €1 billion, as well as spend €2 billion in debt refinancing by 2015.
"To deliver on this strategic plan, we need to regain competitiveness - that means having the right products, quality of execution, and lowering our costs to be similar to peers,” Combes told reporters.
Alcatel-Lucent posted a €353 million net loss for Q1 2013, and Combes is the third CEO to attempt to bring the company out of its debt.
Of ‘The Shift Plan’ Alexander Peterc , analyst at Exane BNP Paribas, told reporters he was expecting more emphasis on what would drive the business forward, and Pierre Ferragu, analyst at Bernstein Research, said that cost-saving could have been increased.
“This plan goes in the right direction, but I believe some elements of it are not aggressive enough,” said Ferragu.
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