The Tatas and Lucent Techno-logies, the former systems and technologies business arm of AT&T, have decided to merge their separate telecom ventures into one mega venture called Tata & Lucent Technologies Ltd in which the two principals will hold 50 per cent each.
The four firms Tata Tele-com, Lucent Technologies India (the 100 per cent unit of Lucent Technologies of US) and two Tata-Lucent joint ventures, AT&T Switching Systems and Trans-India Network Systems will be amalgamated to form the single entity that will undertake all telecom activities and ventures of the Tata and Lucent groups in India.
A press statement issued by the two groups said the new company will be operational by April and will headed by Vijay K Gupta as chief executive and managing director. Gupta is now the chief executive officer of Tata Telecom.
The statement said the existing shareholding of the Tatas in the joint ventures will be transferred to the new venture. The market for this venture include basic cellular operators, value added service providers, DoT and power and utility companies.
Lucent Technologies was formed in September 1996 after AT&T restructured its operations last year. It designs, builds and delivers a wide range of public and private communications networks, communications systems and software and business communications.
The Tatas had two different joint ventures with AT & T and its subsidiaries. The two companies also had stand-alone ventures in different areas. The first was AT&T Switching Systems, a 51:49 venture of Lucent Technologies and Tata Industries to make AT&T switching products in India.
The second was Trans-India Network Systems, a joint venture between Tata Telecom and Lucent Technologies, to make transmission systems in India. Both ventures were heavily dependent on DoT orders for their potential growth.
And then there was Lucent Technologies India Pvt Ltd, the 100 per cent subsidiary of Lucent Technologies of US, and Tata Telecom, which makes telecom equipment and ancillaries.
"The Tata businesses are pleased to expand their relationship with Lucent Technologies. Each partner brings its own unique benefits to this partnership which, when combined, will be a leading force to help modernise Indian telecommunications and provide a positive impetus to India's economic growth," said Ratan N Tata, chairman of the Tata group.
It is not known how the transfer of Tata Telecom to the venture will take place. Sources in the company said all details including the names of the valuers to evaluate the transfer, and the composition of the board of the new company will be known only after senior executives, including Vijay Gupta, come back from Hong Kong where they have gone since the agreement was signed.