LONDON (CNNfn) - New Jersey-based telecommunications equipment-maker Lucent Technologies is close to announcing a more than $16 billion takeover of computer networking firm Ascend Communications, according to published reports Monday.
The deal in the rapidly growing market for data networking and telecommunications equipment has been the subject of speculation for months, and could be announced as soon as Wednesday.
The buyout would create a company able to challenge market leader Cisco Systems (CSCO).
Growing convergence of traditional voice networks and high-speed data networks has meant that Ascend and Lucent compete against each other far more. Ascend is seen as having the edge in technology, while Lucent has the sales force and financial clout to push Ascend's products to a far broader customer base. Ascend has established a lead over Cisco in the telephone market for data switching, which Cisco is not expected to match until mid-year.
Lucent is valued on the market at about $151.6 billion , while Ascend (ASND) has a market value of about $15.5 billion based on its Friday closing price of $71.44 a share on the Nasdaq Stock Market. Lucent shares closed at $115.25 in New York Stock Exchange composite trade on Friday.
Neither Lucent, formerly part of AT&T where it supplied telephone equipment, nor Ascend would comment on the story. And sources cited in the reports said that while the deal was at an advanced stage, it could still fall through.
from staff and wire reports