BT rejection leaves Marconi in the soup

Summary:BT's choice of suppliers for its £10bn network upgrade continues to reverberate through the UK telecoms sector, with job losses feared at Marconi

UK telecoms equipment maker Marconi is struggling to come to terms with its failure to win a contract to help build BT's 21st Century Network.

Union officials fear that thousands of jobs are at risk, after Marconi warned that "all strategic options" were under consideration following BT's decision to award the valuable 21CN contracts to rival firms.

"The company clearly recognises the need to refocus its business in the light of BT's decision and recent trends in the global telecoms equipment market. The board will continue, therefore, to pursue all strategic options with the objective of maximising shareholder value," said Marconi in a statement released on Tuesday.

"Management is reviewing the resource and headcount in each of its activities, particularly in the UK, and will announce shortly the result of this review, together with the associated cost savings and level of headcount reduction," the company added.

The failure to win a place at BT's 21CN table is a humiliation for Marconi, which suffered a corporate near-death experience in 2002 after the telecoms crash that followed the . A restructuring deal had put the firm back on its feet, but its share price plunged 40 percent on Friday following BT's announcement.

BT's choice of partners for 21CN could herald a shift in the telecoms landscape. China's Huawei was a big winner, and analysts have speculated that Marconi could even face a take-over bid from Huawei, following its sudden drop in value.

Topics: Networking

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