Alcatel (ALU) Nears ~$1.3B Lifeline; Will Need to Provide Solid Turnaround Plan

December 4, 2012 7:24 AM EST Send to a Friend
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Alcatel-Lucent (NYSE: ALU) could be poised for a little more upside as it nears financing deals which will allow the company to perform further restructuring and cost-cutting measures.

Reports out Tuesday have Alcatel in talks with at least three banks over getting €1 billion (about $1.3 billion) in fresh capital to help the beleaguered telecom equipment company right ship.

Sources told Bloomberg that a financing deal might be inked before the end of the year.

Getting the capital won't be easy; Alcatel will need to provide a comprehensive plan indicating how the funds will help it stem its six-year streak of losses. However, should the lenders see Alcatel as a worthy risk, the funding should strengthen Alcatel's balance sheet and provide it with more flexibility in restructuring the company.

Shares are flat in pre-market trading.


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