Alcatel May Acquire Nortel's UMTS Business

by CXOtoday Staff    Sep 04, 2006

In a strategic move to enhance its global leadership in broadband access, Alcatel may sign a MoU with Nortel to acquire its UMTS radio access business (UTRAN) and related assets for $320 million.

“Combined with our strong GSM/ EDGE position, our early leadership in WiMAX and our strong commitment to LTE, this acquisition will add further momentum to Alcatel’s broadband wireless access strategy,” said Marc Rouanne, President - mobile communications activities, Alcatel.

The proposed sale includes Nortel’s UMTS access product portfolio made up of the Radio Network Controller and Node B products and OAM solutions, associated patents and tangible assets as well as customer contracts.

With this acquisition, Alcatel will serve every fourth UMTS operator, with an additional 14 customers in its kitty. It will also significantly reinforce its presence in world-leading 3G markets such as South Korea, Italy, Spain, France, and the UK. Alcatel will also be in a better position to address the needs of upcoming 3G markets and regions where it has a strong GSM/ EDGE presence.

“Through the contemplated merger with Lucent, the combined company will also enjoy a leading position in CDMA EV-DO, including a clear commitment to Rev C, thus offering the most comprehensive and innovative wireless access portfolio in the industry,” added Rouanne.

The companies are hoping to complete the transaction process by the fourth quarter of 2006. A large majority of Nortel’s UMTS access business employees are expected to transfer to Alcatel.