Alcatel-Lucent seeks to accelerate integration plans

PARIS - Alcatel-Lucent SA, the telecommunications-equipment maker whose shares have slumped 36 percent this year, plans to speed up the integration of the former Alcatel SA and Lucent Technologies Inc.

Chief Executive Officer Patricia Russo has been given until Oct. 30 to present an emergency restructuring plan to her board, and to explain where the company should focus research and sales efforts, the Financial Times reported today, citing an unidentified person close to the Paris-based company's board. It has operations in Naperville and Lisle.

"The board's move is quite positive for shareholders," said Matthieu Bordeaux-Groult, a fund manager at Richelieu Finance, which oversees the equivalent of $5 billion in assets. "The market is expecting tangible actions, no more profit warnings."

Alcatel-Lucent, the world's biggest maker of phone equipment, on Sept. 13 said sales growth may stall in 2007, third-quarter profit excluding items will be "around break- even" and margins will shrink. Alcatel bought Lucent in November for $11.6 billion.

"The company has been working on integration plans and has been looking at ways to accelerate those plans in light of the Sept. 13 announcement," Alcatel-Lucent said in an e-mailed statement in response to questions about the newspaper report.

"As would be expected, management reviews its plans with the board," the statement said. "The company takes seriously the need to improve the financial performance of the business and is tak ing the necessary steps."

Russo said in February the company would cut 12,500 jobs, or 16 percent of the workforce, to help shave about $2.4 billion in annual costs in three years. The newly created company had originally planned to shed 9,000 workers.

Alcatel-Lucent should more than double the job cuts to 30,000 to bring sales and profit per employee in line with peers including Ericsson AB, Per Lindberg, an analyst at Dresdner Kleinwort, sa id in a research note circulated yesterday.

The company's French unions this month agreed to the terms of job cuts in France, saying that the alternatives to not signing an agreement were "even more dangerous."

The board met in Paris on Sept. 21 and told Russo to present information at the next board meeting on Oct. 30, the FT said, citing the person.

Russo and Chief Financial Officer Jean-Pascal Beaufret were asked to leave the meeting while directors discussed the company's situation, Les Echos reported.

Regine Coqueran, a spokeswoman for Alcatel-Lucent, said, "Outside of that statement, we have no comment."

Coqueran confirmed the company has a regular board meeting on Oct. 30. Alcatel-Lucent is scheduled to report earnings the next day.