Thales snaps up Alcatel's satellite operations

Following on from news of its merger with Lucent, Alcatel has announced it is to sell its satellite operations to French defence and technology firm Thales.

According to Thales, the acquisition will allow it to expand its customer base and aid it in reinforcing its systems capabilities.

Thales will pay Alcatel 26.7 million shares, giving Alcatel a 21.6 per cent share in Thales, and a cash payment of €673m. Thales said that an extra fee, to be decided by a "mandated expert", could be payable in 2009.

As a result of the deal, Thales will now hold Alcatel's 67 per cent stake in Alcatel Alenia Space, a satellite manufacturing joint venture, and its 33 per cent stake in Telespazio, a satellite services company.

Thales said it expects the agreement will save it €50m in operational synergies by 2008 and that there will be no reduction in workforce as a result of the deal.