In a dramatic development, China Huaxin has acquired an 85% stake in the French company Alacatel Lucent's enterprise business for Euro 202 million. Alcatel-Lucent Enterprise will have its headquarters in Colombes near Paris, France.
This was announced today in France as well as in Singapore at a media event.
China Huaxin Post & Telecommunication Economy Development Center ("China Huaxin" in short) is an industrial investment company that seeks long-term commercial growth opportunities in the Information and Communications Technologies (ICT) sector. The $1 billion China Huaxin has extensive global operations and international investment experience and has made investments in top-tier Chinese telecom suppliers such as Alcatel-Lucent Shanghai Bell and the Yangtze Optical Fiber & Cable Company Ltd.
Alcatel-Lucent Enterprise, with headquarters in France near Paris and 2700 employees worldwide, offers solutions in communications, networking, including cloud solutions for businesses of all sizes. It has presence in 100 countries and it serves more than 500,000 customers across the globe. It is a profitable business with Euro 700 million in annual revenues.
According to Matthieu Destat, head of Alcatel Lucent Enterprise's APAC business, this is a new era for Alcatel Lucent. "Alcatel-Lucent Enterprise will also continue to work with Alcatel-Lucent on a privileged business relationship basis," he said.
The original owner of the enterprise business has kept a 15 percent stake in the enterprise business as it serves many government projects in France and other places. It has a 50 percent market share in France.
Destat said that the investment into the company by the Chinese investor was necessary for Alcatel Lucent's enterprise business to scale up and gain critical size in a highly competitive market. Similar companies have gone down the route of mergers or getting investments loans. "The transaction will now enable Alcatel-Lucent Enterprise to benefit from a strong and recognized investor, providing the means and resources necessary to strengthen its ambition including leadership positions in enterprise communications while accelerating investment in new areas of net growth," he said.
With this change, Destat said that the company aims to double its revenues in 5 years and will focus on top three areas: on key geographies, on certain solutions (such as healthcare) and on cloud services. Also, there is no change in employee numbers after the acquisition, he clarified.