Breaking News
FONT-SIZE Plus   Neg
Share SHARE

WSJ: Alcatel-Lucent Secures $2.1 Bln Debt Financing

Telecom-equipment firm Alcatel-Lucent SA (ALU: Quote) has secured a debt financing deal worth 1.6 billion euros or about $2.1 billion with Credit Suisse Group (CS) and Goldman Sachs Group Inc. (GS), the Wall Street Journal reported, quoting people familiar with the matter. The new package is likely to be announced this morning.

Most of the funds will be secured by the company's U.S. assets, which include a portfolio of patents from the Bell Labs research arm and a data-networking business. Thus, if the company defaults, the lenders will have access to these assets before existing creditors. Credit Suisse and Goldman are said to have sought such a protection.

The cash infusion, along with cash on hand, is expected to enable Alcatel-Lucent to pay off debt maturities of 2-3 years. The new loans may have 5-year maturities.

It was reported by the WSJ earlier that Alcatel-Lucent was exploring the possibility of offering its Internet-routing business as collateral for up to 1 billion euros in loans. The company was also said to be considering pledging its valuable portfolio of patents from Bell Labs.

That report said while Alcatel-Lucent has ample cash on hand, it needs a bigger cushion to allay investors' concerns and also to avoid discouraging potential clients from entering into long-term deals. Only then will the company will have enough time to implement 1.25 billion euros in cost cuts, it said.

The stock fell 0.1 percent on Thursday to settle at 0.85 euros in Paris.

Register
To receive FREE breaking news email alerts for Alcatel-Lucent and others in your portfolio

by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

Business News

Editors Pick
A Thai company has bought iconic U.S. tuna brand Bumble Bee for $1.51 billion dollars. Thai Union Frozen Products Public Company Limited or TUF, the world's largest processor of shelf-stable tuna products snapped up Bumble Bee from private equity firm Lion Capital. Post Synergies, the transaction... Here is a list of interesting stocks to watch on December 19. The good news is you can skip this step. There is a next move that can make your life a lot easier. Our research team has already done the groundwork for you. All these stocks listed below and many more have been researched already, and... Shares of OvaScience Inc. (OVAS) have had a strong run in 2014, rising over 370 percent year-to-date. And that's indeed a very impressive return delivered by the fertility treatment company, which suffered a setback last year when it had to suspend a U.S. trial of its flagship fertility treatment due to regulatory concerns raised by the FDA.
comments powered by Disqus
FREE Newsletters, Analysis & Alerts

 

Stay informed with our FREE daily Newsletters and real-time breaking News Alerts. Sign up to receive the latest information on business news, health, technology, biotech, market analysis, currency trading and more.