Alcatel and Lucent have entered a deal to create a company with sales of 21 billion euro and a market value of 30 billion euro ($25 billion), making it second only to Cisco in the telecom equipment business. Alcatel will offer 0.1952 of its American depository shares for each Lucent share. The deal is set to close in six to 12 months.
Although Alcatel shareholders will own 60 per cent of the combined group, the board will be divided equally with six directors each, aside from two independent European directors to be agreed.
The two companies have promised to jointly deliver 1.4 billion euro ($1.7 billion) in cost savings, partly through a 10 per cent cut in the combined 88,000-strong workforce.
