|
Two Lucent plants for sale
|
 |
June 14, 2001: 2:15 p.m. ET
Deal to sell manufacturing plants to Flextronics falls through, report says
|
NEW YORK (CNNfn) - Plans for Lucent Technologies to sell two manufacturing plants to Flextronics International Ltd. have fallen through, press reports said Thursday.
Lucent had hoped to raise $600 million to $900 million through a deal with Flextronics, a Singapore contract manufacturer. Those plans are scrapped and Lucent has opened the bidding on the plants, located in Oklahoma City and in Columbus, Ohio, to a number of other contract manufacturers, the Wall Street Journal reported.
A Lucent spokesman said the company is moving ahead with plans to sell the plants.
"We have received bids for both of these operations," Lucent spokesman Bill Price told CNNfn. "We expect to make our selection early this summer and have the transactions completed no later than the fiscal year (which is September 30)."
Murray Hill, N.J.-based Lucent declined to comment on who the bids are from. Flextronics (FLEX: down $2.10 to $20.70, Research, Estimates) could not be reached for comment.
News of the failed sale caused Lucent (LU: down $0.49 to $6.75, Research, Estimates) shares to fall nearly seven percent Thursday.
Lucent looks for cash
Since the failure of its attempted $23.5 billion merger with Alcatel S.A., Lucent has vowed to press onward but is still in need of a large cash infusion. Lucent had $5.4 billion in debt as of March 31.
The biggest priority for Lucent currently is to sell its optical fiber unit. In April, four companies were in the running to buy the business, which could fetch as much as $5 billion, analysts have said.
Lucent has multiple bidders for the unit and will continue with that process, Price told CNNfn.com Thursday
Lucent hopes to sell the plants and fiber optic unit because it needs to raise $2 billion by Sep. 30. The struggling company must meet the terms of a $4 billion revolving credit line.
If it fails, Lucent will not be able to complete the planned spin-off of its microelectronics unit, Agere Systems Inc., which went public in March. Lucent is also reportedly considering a large convertible bond offering to ease its debt load.
Earlier this month, the struggling telecom equipment maker offered early retirement packages to more than 10,000 U.S.-based employees as part of its effort to cut costs.
"We are confident we will be able to meet the conditions by Sep. 30," Price said. "Hopefully we will get this all done before then. We have plenty on our plate." 
|
|
|
|
|
 |
|
