Trenton, N.J. – Despite opposition in Europe to the proposed marriage of French and U.S. telecommunications gear makers Alcatel SA and Lucent Technologies Inc., it appears likely the $11 billion deal will squeak through when the companies’ long-suffering stockholders vote Thursday.
The heads of the two struggling telecom equipment and service companies are hardly taking approval for granted, given the collapse of a prior combination attempt five years ago.
Serge Tchuruk, chief executive of Paris-based Alcatel since 1995, and Patricia Russo, CEO of Murray Hill, N.J.-based Lucent since 2002, have been busy promoting Alcatel’s proposed stock-for-stock acquisition of Lucent to the financial community.
They say fusing two companies with complementary technology and limited overlap geographically would improve profit margins by cutting about 9,000 of 88,000 combined jobs, reducing other costs and negotiating better prices with suppliers and their biggest customers.
The companies have predicted about $1.7 billion in savings within three years.
Russo would be chief executive of the new company, AlcatelLucent, and Tchuruk would be chairman.
Stockholders of both companies have suffered through more than five years of sharply depressed share prices, which fell lower after the deal was unveiled April 2.
