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Anti-ports deal crusader: Lucent-Alcatel merger OK

Posted on: Thursday, 6 April 2006, 17:56 CDT

By Susan Cornwell

WASHINGTON (Reuters) - One of the leading U.S. congressional opponents of Dubai Ports World's recent purchase of American port facilities said on Thursday he had no objections to France's Alcatel acquiring Lucent Technologies Inc..

Alcatel is not state-owned, unlike Dubai Ports World which is owned by Dubai in the United Arab Emirates, said Sen. Charles Schumer in explaining the why he backed the $14.1 billion deal to take over New Jersey-based Lucent.

Last month, Schumer crusaded against the Arab purchase of state-owned Dubai Ports World's purchase of terminal facilities at six U.S. ports.

"It's obviously different from Dubai Ports World because the United Arab Emirates had a nexus with terrorism that France does not have," Schumer, a New York Democrat, told reporters.

But he said he believed the merged telecommunications equipment company would have to follow American laws, including strict U.S. business sanctions against Iran.

France's Alcatel has a long-standing business relationship with Iran, having upgraded that country's telecommunications networks and provided communications systems for gas plants there.

Lucent Chief Executive Patricia Russo met Schumer this week and told him the merged company would create a separate U.S. subsidiary that would be run by Americans and handle sensitive government contracts such as those involving Lucent's Bell Labs research facility.

"She satisfied me and I'm going to be supportive of this merger," Schumer said.

Another difference from the Dubai case, he said, was that the board of state-owned DP World was "totally run" by the UAE government, while the board of the proposed Lucent-Alcatel merged company would have six Americans and six French citizens on it.

A few lawmakers have expressed concerns, saying they want more information about the merger, but there has not been the outcry that the Dubai case provoked.

A bipartisan campaign led by Schumer and other lawmakers who said they were concerned about national security forced DP World last month to announce it would sell the U.S. port terminal assets it had just acquired.

U.S. officials have said money for the September 11, 2001 attacks was wired through the UAE's banking system, and two of the September 11 hijackers were UAE citizens.

The Committee on Foreign Investments in the United States (CFIUS), an interagency body that examines foreign acquisitions of American companies, must still review and clear the Alcatel-Lucent deal.

Although no lawmakers sit on the CFIUS panel, their clout was demonstrated by the Dubai furor, which forced the company to back down despite the fact that CFIUS had approved the purchase and President Bush supported it.

Source: REUTERS

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