News In Brief

By Compiled from wire service reportsRobert Kilborn and Stephanie Cook

May 21, 2001

Struggling Lucent Technologies is in negotiations for a takeover by France's Alcatel, and a deal could be announced as soon as next month, reports said. Such a merger would create a global telecommunications equipment supplier worth more than $70 billion, offering a range of products and services to every big-name company in the industry. A merger would double Alcatel's US business and rank it a strong second in US fiber-optics networking. Alcatel also would gain the Murray Hill, N.J.-based Lucent's Bell Laboratories research and develop- ment arm and its expertise in CDMA (code division multiple access) wireless technology, switching, transmission, and core network products. Alcatel, meanwhile, has strength in so-called edge products that connect local networks to long-haul carriers, in optics, and in digital subscriber line technology. The negotiations come as the industry is struggling with a slowdown in equipment spending by telecom carriers. If the two companies merge, various reports said Alcatel would pay anywhere from no premium to perhaps a 20 percent premium over Lucent's current stock price.