Finnish and French telecoms equipment makers warn ‘advanced discussions’ could yet fall apart if Francois Hollande steps in to protect jobs

Nokia is in talks to buy smaller telecom equipment maker Alcatel-Lucent, a deal that would combine the industry’s two weakest players but could pose challenges in cutting costs and overcoming political opposition.

In a joint announcement, the Finnish and French companies said they were in “advanced discussions” on a “full combination, which would take the form of a public exchange offer by Nokia for Alcatel-Lucent”. The two, which have been seen as a possible combination for several years, cautioned that the discussions could still fall apart.

Our biggest fear is the future of our R&D in France, since it develops products in direct competition with Nokia

Just because you combine one weak player with another weak player does not mean you will end up with a stronger player