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July 5, 1987


By CBR Staff Writer

Ferranti Plc has bought out its partner GTE’s 49% stake in their Ferranti-GTE joint venture to manufacture PABXs in Moston, Greater Manchester. Ferranti says the move is part of GTE’s gradual withdrawal from Europe,but it will also pre-empt possible attempts by West German giant Siemens to intrude on the Ferranti business. The venture came into question when Siemens last year took an 80% controlling stake in GTE’s Atea unit in Belgium, and under a complicated formula, it was arranged that the remaining 20% stake in Atea that belongs to GTE would hold the US firm’s 49% stake in Ferranti-GTE in the UK. The German and US companies were originally planning to marry their respective public telephone exchange equipment businesses, bolstering GTE’s cash resources, and giving Siemens a path into the US market. But the plan ran aground and the two settled on a narrower joint venture, which took in GTE’s international interests in microwave, radio and telephone cables and its international manufacturing plants in Italy, Belgium and Taiwan. Ferranti-GTE last year contributed just UKP12m to Ferranti’s UKP628.7m turnover, mainly with the Omni range of PABXs that support 32 to 2,000 lines, but on another level has been built from ground zero to a UKP12m company in about five years. Buying out its minority partner will enable Ferranti to turn the business into the springboard for its ambitions to build a substantial telecommunications business. After largely ignoring the UK computer and telecommunications markets for two decades, Siemens is building up its position in the UK: in February it opened a research and development centre in Woodleigh, near Reading, to do communications equipment and software for Unix computer systems.

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