Alcatel-Lucent Jumps on Report of Restructuring Deadline

Shares of Acatel-Lucent rallied 4.5% in Paris on news CEO Patricia Russo has been given one month to deliver an emergency restructuring plan, according to a report by French newspaper Les Echos. Acatel-Lucent's Board of Directors expects Russo to present her plans at the company's next board meeting on Oct. 30. "As would be expected management reviews its plans with the board. The company takes seriously the need to improve the financial performance of the business and is taking necessary steps," said the company in a statement. Acatel-Lucent's share have dropped almost 40% year-to-date as the company has issued three profit warnings under Russo's leadership. A Dresdner Kleinwort analyst comments, "There is little doubt that the merger between Alcatel and Lucent has turned into a veritable fiasco." Acatel-Lucent's ADRs gained 3.4% to $9.57 on Thursday and are up 6.2% to $10.16 in thin pre-market activity.

Sources: FT.com, MarketWatch
Commentary: Alcatel-Lucent Cuts Outlook, Shares Drop • Alcatel-Lucent: Exercising The Power Of No • Still Time to Pull the Switch On Telecom Equipment?
Stocks/ETFs to watch: ALU. Competitors: ERIC, NT, CSCO. ETFs: BDH, IGN
Earnings call transcript: Alcatel-Lucent Q2 2007

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Comments

[Carpe Max:]

She is in an almost impossible situation. I seriously doubt she'll be able to come up with any plan to realistically turn this company around in a month, especially after 3 profit warnings. It seems like the Board has pretty much lost confidence in her. Maybe she could turn to a contact, or a contact of a contact, for help or advice. According to NewsVisual she does have some interesting board connections www.newsvisual.com/new... . That seems to be about her only choice now.

2007 Sep 28 05:40 PM