Newbridge Networks denies takeover rumours

Local officials have denied reports that Newbridge Networks is in takeover talks, despite widespread speculation Alcatel and Ericsson are bidding for the troubled equipment vendor.

Reports from the UK last week claimed a Newbridge Networks official had admitted the vendor was in talks with Alcatel, although the official had refused to specify whether they were acquisition-related.

The official was also quoted as denying earlier media reports that Newbridge Networks was in discussions with Ericsson which had shot Newbridge's stock price up 13 per cent to $20.62 at the close of business on November 12.

However, David Cryer, corporate communications manager at Newbridge's Australian operations, brushed aside reports of merger or acquisition negotiations, saying "the company's strategy is definitely to stand alone".

But Cryer would not elaborate on how the company proposed to turn around its recent poor financial performances, which have seen it issue six profit warnings over the past 10 quarters.

The company recently announced its revenue and profit results for the second quarter would be below analysts' expectations and its stock has fluctuated from $39.87 to as low as $14 during the past year.

Other companies mentioned as possible buyers of Newbridge Networks include British systems group Marconi, US telecommunications equipment maker Tellabs, Japan's Fujitsu and Germany-based Siemens.

Alcatel Australia officials would not comment on acquisition rumours, and Ericsson Australia did not return calls by press time.

Newbridge Networks makes asynchronous transfer mode (ATM) switches, which send multimedia data across networks at high speeds.

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More about Alcatel-LucentEricsson AustraliaEricsson AustraliaFujitsuMarconiNewbridgeNewbridge NetworksSiemensSystems GroupTellabs

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