Alcatel, Lucent Discuss Giant Telecom Equipment Merger

Alcatel, Lucent discuss giant telecom equipment merger

PARIS, March 24 (Xinhua) — French telecom technology provider Alcatel, and U.S. equipment firm Lucent Technologies, will try once more to create a world leader of telecom equipment, the two companies announced Friday.

A brief joint statement issued by Alcatel and Lucent said they had already engaged in negotiation aiming at a merger worth about 33.0 billion U.S. dollars, with Alcatel worth close to 20 billion dollars, and Lucent 12.6 billion dollars, on the basis of closing prices in New York on Thursday.

“We can confirm that Lucent and Alcatel are engaged in discussions about a potential merger of equals that is intended to be priced at market,” the statement said without giving any further financial details.

“There can be no assurances that any agreement will be reached or that a transaction will be consummated. We will have no further comment until an agreement is reached or the discussions are terminated.”

Based in Murray Hill, New Jersey, Lucent grew rapidly in the late 1990s until the technology bubble burst in 2002, when it almost went bankrupt. It has survived through thousands of layoffs and drastic budget cuts.

Alcatel reported a 61-percent increase in net profit for 2005, around930 million euros (1.12 billion dollars), based on a 7.3 percent increase in sales of 13.1 billion euros. Its strengths are its digital subscriber lines and Internet Provider solutions.

The announcement came one day after the French parliament voted in a takeover law bill to protect French companies from hostile takeovers.

The two groups failed in an attempt to merge in 2001.