Alcatel-Lucent (ALU) May Use Assets as Collateral to Secure New Loans
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Alcatel-Lucent (NYSE: ALU) shares are on the move higher Friday following chatter the it migth be in talks to get a loan from Goldman Sachs.
Bloomberg reports this morning that Alcatel might use assets to gain the loan, which was of an undisclosed amount.
CEO Ben Verwaayen has felt some pressure basically since taking over some six years ago and shares falling 34 percent in 2012 to new 23-year lows isn't helping his case out. The executive has been forced to explore options for the company which range from asset-backed financing to patent and asset sales. Since Alcatel merged with Lucent Technologies back in 2006, the combined company has been posting a cash burn rate of €700 million or so per year.
Of course, Alcatel isn't alone. Companies like Nokia Siemens Networks, a joint venture of Nokia Oyj (NYSE: NOK) and Siemens AG (NYSE: SI), has also been hitting somewhat of a brick wall amid the continuing financial fallout. That company is also exploring sales of its business support services unit and also has moved to cut about 17,000 jobs.
Alcatel might explore that sale of units like its enterprise unit as well as a division that makes undersea fiber-optic cables, Bloomberg noted today, citing sources.
But, until things in Europe firm up, Alcatel and others will continue to see pressure to any possible upside. Shares are up about 18 percent on the session.
Bloomberg reports this morning that Alcatel might use assets to gain the loan, which was of an undisclosed amount.
CEO Ben Verwaayen has felt some pressure basically since taking over some six years ago and shares falling 34 percent in 2012 to new 23-year lows isn't helping his case out. The executive has been forced to explore options for the company which range from asset-backed financing to patent and asset sales. Since Alcatel merged with Lucent Technologies back in 2006, the combined company has been posting a cash burn rate of €700 million or so per year.
Of course, Alcatel isn't alone. Companies like Nokia Siemens Networks, a joint venture of Nokia Oyj (NYSE: NOK) and Siemens AG (NYSE: SI), has also been hitting somewhat of a brick wall amid the continuing financial fallout. That company is also exploring sales of its business support services unit and also has moved to cut about 17,000 jobs.
Alcatel might explore that sale of units like its enterprise unit as well as a division that makes undersea fiber-optic cables, Bloomberg noted today, citing sources.
But, until things in Europe firm up, Alcatel and others will continue to see pressure to any possible upside. Shares are up about 18 percent on the session.
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