Alcatel-Lucent's (ALU) 2006 merger was supposed to create a trans-Atlantic telecom gear giant -- a big link-up in response to massive consolidation among its customers: telephone and wireless carriers. But so far, it's been a dud, and now the deal architects are stepping aside.
Alcatel-Lucent CEO Patricia Russo will leave the company by the end of the year and Chairman Serge Tchuruk will leave on Oct. 1, the company said today.
Since merging, the company has posted six straight quarters of losses, and its stock has dropped 57%, closing Monday at $5.76. WSJ:
Yet some expressed concern that no successor had yet been found, and doubted whether the change in leadership meant that Alcatel-Lucent's fortunes would improve.
"I don't think it should be seen as good news," said WestLB analyst Thomas Langer. "What you need in such difficult times is true leadership." Mr. Langer, who has a "sell" rating on Alcatel-Lucent stock, said no potential replacements spring immediately to mind. ...
Alcatel-Lucent was forced to cut prices and even take some losing contracts last year to keep a foothold in important emerging markets like China and India. The company issued repeated revenue and profit warnings, losing the confidence of some analysts and shareholders.
Alcatel-Lucent shares are up 4.5% to $6.02 in pre-market trading.
