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Alcatel Increases Its Participation In Thomson-CSF's Capital;Industrial And Technological Cooperation Takes Another Step
Alcatel and Thomson-CSF announced today the conclusion of the agreement made on July 29th aiming to reinforce the strategic partnership between the two groups.
Alcatel will increase its participation in Thomson-CSF's capital and the industrial and technological cooperation between the two groups is to be reinforced. This announcement was made during a press conference which was held in Paris by Denis Ranque and Serge Tchuruk.
1) Increase of Alcatel's participation in Thomson-CSF's capital
The French government will transfer to Alcatel 9.45% of Thomson-CSF's capital, bringing Alcatel's participation in Thomson-CSF to 25.3%. At the end of this operation, the French government's share in Thomson-CSF's capital will be reduced to 33.4%.
On several occasions, Chairman Denis Ranque has indicated that this change in the Group's capital would be a positive move, underlining that "it would give a clear signal to our international partners that Thomson-CSF is firmly committed to embracing and building on its new status as a private company, to improving profitability and achieving more rapid growth".
The financial and industrial conditions of this agreement have been submitted to the French "Commission des Participations et des Transferts", whose approval is required for this transaction. The price per Thomson-CSF share would be 36 euros. This transaction is part of the overall restructuring of Framatome's capital, as Alcatel's capital increase in Thomson-CSF will be financed by the sale to the French government of a block of Framatome shares with an equivalent value.
2) Reinforcing the strategic partnership between the two groups
Further to the increased stake of Alcatel up to 25.3% in the capital of Thomson-CSF, the two Groups have decided to strengthen the industrial and technological cooperation that already unites both companies.
The cooperation implemented between the two companies in the last 16 months has been focused in three areas: research and development, industrial cooperation and the space segment through Alcatel Space, the leading European integrator of civil and military space solutions, with a turnover of 10 billion French francs.
Taking advantage of the civil-military complementarity of their businesses, Alcatel and Thomson-CSF have now identified five new major common projects, which will allow both Groups to reinforce their positions and market shares in key growth technologies or sectors and to achieve together top-ranking positions:
**Hyper-frequency microelectronics, to become one of the market's leading manufacturers of Gallium Arsenide (GaAs) components and modules, allowing hyper-fast signal processing. Up to now used in military systems such as radars, this technology will benefit from the growth of the LMDS (Local Multipoint Distribution Service) market in civil telecommunications;
**Opto-electronics, to supply the necessary technologies for the military market of infrared detection and target designation, building on the technological know-how and production capacities developed for civil optical transmission markets;
**Internet technologies for military networks, and in particular the IP protocol, with the ambition to be positioned as one of the leading suppliers on a market expected to rapidly reach 3 billion euros;
**Digital TV and radio networks, with the objective of becoming one of the leading suppliers of global digital solutions for broadcasting and transmission;
**Electronic payment, with ticketing and banking, to create a major worldwide player, and a leader in Europe in this field, with a turnover of 240 million euros.
Through the implementation of these projects, Alcatel and Thomson-CSF aim to maximize the synergies in the fields of electronics and software to face international competition, significantly reduce costs in their respective businesses and strengthen their profitable growth.
This new strategic step between the two Groups is made possible by the reinforced confidence brought by Alcatel's increased stake in the capital of Thomson-CSF.
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Alcatel Increases Its Participation In Thomson-CSF's Capital;Industrial And Technological Cooperation Takes Another Step