Updated from 1:30 p.m.
may not be left out of the consolidation dance after all.
is interested in the Canadian telco gearmaker's wireless business, according to published reports.
Nortel had to bow out of the last round of industry mergers after stumbling into a third accounting morass and restatement process. While Nortel was reeling with the untimely discovery of more bookkeeping errors, Alcatel went ahead this past spring with a buyout offer for
Now, if the reports are true, Alcatel could make a deal for Nortel's wireless assets and bolster its product offerings. Nortel is among several suppliers of third-generation, or 3G, network infrastructure gear.
A Nortel representative declined to comment. "We are open to options that would increase and reinforce our leadership in this technology," said Alcatel.
"It would certainly make sense," says Telecom Pragmatics analyst Sam Greenholtz. "Nortel has been looking to focus more to the IP market. And Alcatel could really use the wireless technology. It would give them a chance to win back customers that they had lost."
Alcatel and Lucent are expecting to close their merger by the end of the year, and they are part of a wider consolidation pattern in the industry. Last year, No. 1 wireless gearmaker
made a deal for Marconi's telecom networking business. Then in June,
vowed to join their wireless-equipment businesses.
Greenholtz says wireless networking is highly competitive at this point, which should give Alcatel plenty of acquisition leeway with regulators.
Alcatel shares dropped a quarter, or 2%, to $11.03, and Nortel rose 2 cents to $1.99 in midday trading Tuesday.