Alcatel-Lucent (NYSE: ALU) has finally shed part of its struggling enterprise business by reaching a deal to sell its conferencing center business Genesys to Permira for $1.5 billion.
Although the rest of Alcatel-Lucent's enterprise division has continued to struggle, Genesys has consistently been a strong financial performer, with $500 million in revenues in 2010. The deal also includes continued support from Alcatel-Lucent's remaining enterprise division.
After the deal passes U.S. and international regulatory reviews, the two companies expect the acquisition to be completed by either the end of the year or early 2012.
Finalizing this deal took a number of months where Permira initially considered acquiring Alcatel-Lucent's entire enterprise business. But when Alcatel-Lucent and Permira could not agree on a price for the entire enterprise division, the private equity company decided its best option would be better to focus on the Genesys unit.
While the company will retain the rest of its enterprise communications business that it has also been trying to find a buyer for, the sale will give it some much needed cash to fuel Ben Verwaayen's three-year turnaround plan and sharpen its focus on the service provider business.
For more:
- here's FierceEnterpriseCommunications' take
- Reuters has this article
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