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Is Nortel a Takeover Target?
By Mark Evans | June 26, 2006
For all the speculation about Nortel being a buyer, there are some people who believe the company could be bought as the telecom equipment market leading players look to consolidate. India’s Financial Express quotes Charter Equity Research analyst Edward Snyder that “If you look at financials, Nortel is the No.1 target” for a takeover. The story also raises the idea that Alcatel was in talks to buy Nortel before it decided to enter into a marriage with Lucent. If Nortel CEO Mike Zafirovski has his way, Nortel won’t be acquired before his restructuring plan has more time to work and/or revive the stock price, which has dropped more than 30% since Mike Z. came on board last November. There is plenty of speculation a deal involving Nortel could be a win-win for Mike Z. because he could become CEO of a JV or if Nortel was acquired by Cisco, for example, he could become the successor to the existing CEO.
Update: Local Tech Wire has a story looking at Nortel’s M&A prospects. It cites the Toronto Star, which suggests a combination of Nortel, Huawei and Motorola would create the world’s third-largest equipment supplier with 19% market share. “Ego counts, of course, and Nortel CEO Mike Zafirovski left Motorola after being passed over for the top job,” the Stars wrote. “But a deal could be done if Zafirovski and the turnaround CEO who got his Motorola job, Ed Zander, could work out a not-unusual co-CEO arrangement. And the Chinese, eager to tap Nortel’s wireless technology, are equally sanguine about upheaval in the developing countries where they seek oil and the Toronto suburb where financial restatements are a quarterly occurrence.â€
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Topics: Analyst Coverage, M&A |
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