Alcatel-Lucent (NYSE: ALU) has reinforced its commitment to launch an initial public offering for its submarine cable network unit in the first half or 2015, but the exact timing will be driven by market conditions.
In late July, the vendor first revealed plans to pursue an initial public offering of shares for its submarine cable business, ending a string of rumors that began to emerge in 2013 about the future of the division that's been suffering from weakening demand.
When the IPO takes place, Alcatel-Lucent previously said that it would retain a majority stake in the business, while the IPO would provide resources to expand the business further into the oil and gas market.
What's driving the vendor to make this move is part of company CEO Michel Combes' overall strategy to exit what he says are low-growth businesses. During the opening of a research hub south of Paris, Combes said Alcatel-Lucent will lay out its five-year technology strategy in November, reported Reuters.
At the same time, the vendor continues to maintain a high profile in the submarine cable business. Just last week, Alcatel-Lucent began construction of the Sea-Me-We 5 undersea cable system linking Singapore and France. Alcatel-Lucent has started construction of the segments spanning from Sri Lanka to France, while co-contractor NEC will be deploying the Singapore to Sri Lanka segment.
- Reuters has this article
- see this release
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