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October 20, 1987

GEC-PLESSEY MERGER MAY NOT BRING THORN-ERICSSON MORE UK ORDERS AFTER ALL

By CBR Staff Writer

Ericsson is hopeful that results of Tranche 12 orders for British Telecom’s public switching requirements, due to be released to GEC, Plessey and Thorn-Ericsson any day now, will give the last a solid share this time round – but sources close to British Telecom say that the UK phone company is far from satisfied with Ericsson’s pricing. We are optimistic that we have put in a very competitive bid this time, says corporate affairs manager at Thorn-Ericsson Ron Ely. If British Telecom stays with the current situation in the future, and assuming the GEC & Plessey Telecomunications merger goes through, we would hope to stand to win a larger proportion of the tranche orders than we would have done in a three-way split, says Thorn-Ericsson corporate affairs manager Ron Ely. But the word out of British Telecom is that Ericsson has a lot further to go on price if it is to win a major share of future business, and that a third contender may well be introduced following the merger of GEC and Plessey telecommunications. And while Nor-thern Telecom is favourite for the third place fol-lowing its investment in STC – at a price way above the level STC shares reached yesterday – British Telecom sources suggest that Siemens as well as AT&T-Philips, which already has some Telecom business, is seen as being very much in the running..pl 72

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