Lucent Technologies Announces Plans to Sell Power Systems Business
Lucent Technologies (Murray Hill, NJ) announced it is seeking a buyer for its Power Systems business, a leading supplier of power products for the telecommunications and computer industries. Lucent will begin discussions with potential buyers shortly and expects the sale to move quickly with a buyer identified within six months.
"The decision to sell our Power Systems business is part of Lucent's ongoing effort to sharpen its focus on its core business, communications networking and providing Internet infrastructure, while better leveraging our capital and research and development investments," said John Dickson, executive vice-president and CEO of Lucent Technologies. "Our Power Systems business has a lead market position, double-digit growth, world-class research and development, and experienced leadership, all of which will make this business extremely attractive to potential buyers."
Lucent's Power Systems has been ranked number one in world-wide sales, generating about $1.2 billion in total revenues for 1999. According to Bruce Brock, COO and vice-president of Power Systems, the company is expected to reach upwards of $25.0 billion globally this year. "The company that acquires us will need to be a top competitor," Brock stated. "We expect a fair offer in the high range."
Lucent will continue to be a significant customer for the Power Systems business. In response to questions on whether Power Systems will be sold together or separated, Brock replied, "We've concluded that no split will occur ... that's the best deal ... we're going to keep it whole globally."
"This move will enable Power Systems to operate in a space where it can even better serve customers, continue its strong growth and strengthen its position as the premier power supply manufacturer in the world," Brock stated. "Lucent will be looking for a buyer who shares our commitment to customers and appreciates the value of the employees who made this business a market leader."
More than 4,700 employees work for Lucent's Power Systems, headquartered in Mesquite, TX, with 30 locations around the world. "I believe that the sale this morning was the first our people knew about it," Brock replied in response to how employees were taking the news. "Our people worldwide have had a very positive response... with many questions. There is a general positive feeling about this opportunity of a lifetime."