There had been fears of a rush to dump shares in a company operating in a hugely unpromising sector. But despite huge trading, the shares steadied at 58.97 pence, meaning a company valued at 35bn pounds ($57.2bn) at the height of the dot-com boom is now worth just 586.7m pounds ($959.5m).
Shorn of the 4bn pounds ($6.5bn) debt burden that brought the company to its knees, Marconi has started to attract admirers. According to a research note from Deutsche Bank: The new Marconi emerges from its restructuring with a relatively low level of balance sheet risk, the opportunity to increase revenues from a retrenched base, and scope to increase gross margins towards the sector average,
Oozing optimism, chief executive Mike Parton said that its emergence with a significantly improved financial position, substantial improvements in operating performance and a sharper focus on telecommunications equipment and services allows us to look to the future with greater confidence and optimism..
Though it has managed to cut costs substantially, Marconi is battling to keep market share in a shrinking sector. It expects sales to decline 5% in its current 2004 financial year to around 1.79bn ($2.8bn).
Source: Computerwire
