Bay acquisition gets integrators' cautious approval

Bay acquisition gets integrators' cautious approval

The possibility of yet another mangled merger is the biggest concern of Bay Networks resellers and integrators, after Nortel bought the data networking vendor for $US9.1 billion last week.

Having already experienced one painful merger when Wellfleet and Synoptics came together to form Bay Networks, the last thing partners want is a repeat performance. That concern aside, integrators contacted by ARN were cautiously optimistic about what is the industry's biggest networking acquisition to date.

David Shein, managing director of Com Tech, believes the deal looks good on paper but cautioned that any companies involved in a merger of this magnitude would have their work cut out for them.

"The Synoptics and Wellfleet merger looked good on paper too, but in my opinion was a complete disaster," he said.

"It all depends on how the merger is executed. From the outside it is difficult to know what all the internal politics are."

JNA's regional manager, Roger Harvey, agreed. "How the two cultures clash or combine will be critical," he said. "You only have to look back at Wellfleet and Synoptics to see how important that is."

Anixter's general manager of network integration business, Kent Brooks, was hopeful that the pain felt previously by Bay would stand the company in good stead now.

"I think they've probably learnt a lot from that, and new CEO David House is much more of a visionary and will make sure things happen," he said.

"The big difference I see," said David Bowden, sales director of CIC Technology, "is that it's not a merging of two similar product lines like it was with Wellfleet and Synoptics. Bay is another piece of the puzzle for Nortel so there shouldn't be any rationalisation of product."

Bowden said that although it was early days he could only see positives and was "quite comfortable that it won't impact our relationship with Bay". That was a recurring theme with all of the integrators.

"It's a very positive thing for Anixter because we partner with Bay worldwide, plus Nortel have been a partner and a customer for many years. So having the two together can only be a good thing," Brooks said.

"With the convergence of voice and data too it's far better for a company like ourselves to deal with one entity," he said.

A perfect marriage

Harvey said the two companies complemented each other. "Bay needs a bigger partner," he said,Both Com Tech and Anixter were careful to point out that they supported other vendors, including Nortel's biggest competitor Cisco. So whatever the result of the merger it would have little impact on their businesses.

"We bet on our customers not on any vendors," said Shein.

More merger details - page 24

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