Morgan Stanley: The first 100 days of Michel Combes
Michel Combes, the new CEO of Alcatel-Lucent who will take office on April 1, will have cut out given the many structural challenges.
However, the time available should be sufficient to reorganize the telecoms equipment maker, said Tuesday Morgan Stanley.
The leader has two years to straighten the accounts of the company has completed in January an agreement to refinance two billion with banks.
100 days to convince
In a note entitled "The First 100 Days of Michel Combes," the analyst stressed that its decision to retake positive value was based primarily on the potential restructuring of the company. Morgan Stanley believes that the Group can further improve its management of working capital needs.
In addition, Alcatel has already started working on a strategic review of its business networks, but the share of R & D (research and development) on sales remains above 200 basis points to its competitor Ericsson, says Morgan Stanley.
IP segments (ex-TiMetra, acquired in 2003), and wireless solutions in the United States (ex-Lucent during the 2006 merger) are doing well and are profitable, but only 25 to 30% of net 'total revenue, also notes the broker.
On the Enterprise segment considered not strategic and whose profitability was affected last year by the slowdown in European markets, an assignment of the entity, once recovered, would reduce the level of debt, says Morgan Stanley, enhances the activity between 300 and 350 million euros.
On the issue of monetization of patents, which is one of the priorities of management, all can not generate royalties , says the bank.
Finally, Morgan Stanley does not mean that the center of gravity of the equipment moves to the United States, with headquarters far less expensive than its Paris headquarters located near the Eiffel Tower , which would reduce operating expenses.
In summary, the task will not be easy for Michel Combes and Morgan Stanley doubt that all the problems he mentioned are resolved by the summer.