Philippe Camus Discusses Alcatel Lucent Merger

Alcatel-Lucent Chairman Philippe Camus was recently a guest speaker in Visiting Professor Laurent Cohen-Tanugi’s course on Transatlantic Mergers & Acquisitions. Mr. Camus, who expressed himself in his personal capacity, took on his position as Chairman in the second year following the merger of Alcatel and Lucent after the withdrawal of the executive team (Serge Tchuruk and Pat Russo) who negotiated and began implementing the merger. He was formerly CEO of EADS, the European aerospace and defense group.

Mr. Camus’ talk reflects on the implementation of the Alcatel-Lucent merger and draws broader lessons on the post-merger integration process and how to maximize the chances of success in a cross-border merger.

The presentation begins with an overview of Alcatel-Lucent and of the global consolidation of the telecommunications equipment and services market, which was the primary business rationale for the merger. Mr. Camus then goes on to address the specific challenges involved in the Alcatel-Lucent transaction, as a “merger of equals” and a cross-border business combination, in a technology-driven industry. In his view, the key success factors of a merger of that scale include a sound business case, clear leadership at the top to drive the integration process and manage the transition, speed of decision-making and implementation, and empowerment of middle management. Based on an employee survey conducted shortly after the merger, Mr. Camus believes that the integration process suffered from an excessive focus on “synergies” and cost-cutting, as opposed to innovation, operational efficiency and customer solution.

Two years after, drawing on these lessons, Alcatel-Lucent has a new executive team and a new board, which are implementing a new organization and business model.

A video of Mr. Camus’ presentation is provided below: (video no longer available)

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  1. Doug Park
    Posted Saturday, May 9, 2009 at 12:47 pm | Permalink

    Mr. Camu’s observations about M&A strategy are well taken. The problem with most mergers is that they focus on synergies and cost cutting. We all know of cases where the acquirers destroyed value because of the search for synergies (e.g., TimeWarner/AOL). But this raises an important question: Why do most rationales for mergers and acquisitions continue to focus on synergies? I believe in part that many managers continue to cling to the belief that synergies are the strong justification for a merger. Perhaps they should look to empirical evidence instead. See Pfeffer and Sutton’s Evidence-Based Management on the topic.

  2. Fan WANG
    Posted Monday, March 1, 2010 at 8:54 am | Permalink

    can’t open it