Lucent faces lawsuit related to buyout by Alcatel

WASHINGTON (Dow Jones/AP) -- Lucent Technologies said Wednesday it faces a putative class-action lawsuit in New Jersey tied to its planned acquisition by Alcatel.

Lucent said in its quarterly report filed with the Securities and Exchange Commission that the suit claims the proposed merger is the product of breaches of duty by Lucent's board members because they allegedly failed to maximize shareholder value.

The lawsuit, Resnick v. Lucent Technologies Inc., et al, names the company and members of its board. The plaintiffs propose to represent a class of Lucent's public shareholders, the filing said.

The lawsuit, filed April 3 in state Superior Court in Union County, N.J., also seeks an injunction against the closing of the proposed merger.

``We believe the action is without merit and that the company has substantial defenses to the claims,'' Lucent said in its SEC filing.

Alcatel agreed to acquire Lucent in April for $13.45 billion in stock, expanding Alcatel's share of the U.S. market.

Separately, on Tuesday, a regulatory disclosure said Alcatel and Lucent outlined terms on the combined companies' structure, location and even its name in order to protect Lucent's prerogatives and create a ``merger of equals'' before they reached a deal.

Lucent shareholders will vote on the deal at a special meeting Sept. 7, according to a filing made by French telecommunications company Alcatel with the Securities and Exchange Commission. Alcatel already had scheduled its shareholder vote for that day.

On March 16, more than two weeks before the deal was announced, Lucent and Alcatel sketched out a preliminary agreement on such issues as the location of the headquarters (France), the structure of the board (equal contributions from both companies), and the name of the combined companies (which will consist solely of neither company's name.)

The companies' global research and development headquarters and North American operating headquarters are to be in New Jersey, Lucent's home state.

The new board will consist of Alcatel Chairman and Chief Executive Serge Tchuruk, Lucent Chairman and Chief Executive Patricia F. Russo, five members from each company's board and two independent directors mutually agreed upon. The two independent directors will be ``one French and one European,'' Tuesday's disclosure said.

The structure of the board ensures that no director will have a tiebreaking vote, the filing said. The companies agreed that Tchuruk will be non-executive chairman of the board of directors of the combined company, and Russo will be chief executive.

The deal is, however, structured as a buyout, as Alcatel will exchange nearly a fifth of an Alcatel American Depositary Receipt for each Lucent share.

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