Filed by Alcatel
Pursuant to Rule 425 under the Securities Act of 1933
And Deemed Filed Pursuant to Rule 14a-12
Under the Securities Exchange Act of 1934
Subject Company: Lucent Technologies, Inc.
Commission File No. 001-11639
On April 2, 2006, the Chairman of the Board of Directors and Chief Executive
Officer of Alcatel sent the following letter to the employees of Alcatel.
Dear Colleagues,
I am happy to announce to you that the discussions we started with Lucent have
resulted in an agreement to merge our two companies, which would create a
world leader in communications solutions.
We have a prior history with Lucent. Five years ago we considered merging, but
there were too many constraints for both companies for the deal to be
successful. Alcatel has made good use of this period to reshape our financial
situation, to consolidate our position in various global markets and to become
the indisputable leader in Triple Play and a leading player in convergence.
Lucent, in turn, under the management of Patricia Russo, has evolved similarly
and has, in particular confirmed its global leadership in CDMA.
Today we are facing challenges in our rapidly changing industry - strong
competition, consolidation of the market, and convergence in technologies and
services - we had to pick up the pace. Lucent is the ideal partner, our two
companies being very complementary geographically as well as in our product
portfolios. With this merger, we will be the pacesetter in the transformation
of our industry. We will have combined revenues of 21 billion euros and will
substantially enhance our global Research and Development capabilities (26,100
Engineers and a budget of approximately 2.4 billion euros).
What these companies can accomplish together far exceeds what each of us could
do on our own. The combined company will allow us to cover the world better
than any of our competitors. Combined we become the leading player in
convergence, the number one in wireline, number two in wireless and number two
in services. This is particularly true in almost all next-generation network
technologies.
The most successful unions between two companies occur when they have more to
offer one another. Thanks to the strong complimentary nature of our two
companies this deal will result in synergies that can be managed reasonably
well. The fundamental value of the deal is that of growth creation. We also
share a common vision and understanding of network evolution and of our
customers' needs, as well as a shared culture of technical excellence.
The merger is now under way. It has been approved by the Boards of both
companies and must now be examined by the authorities in the United States and
in Europe. It must also be approved by the shareholders of both companies. It
will take six to twelve months to close the deal. At the same time our two
companies will continue to operate separately with our customers' satisfaction
remaining our daily goal.
We will make use of the coming months to prepare for the merger of the teams
and processes. An "integration" task force managed by Patricia Russo and me
will be set up very shortly. The objective is that on day one the newly named
company will be operational straight away. In a merger, restructuring is
inevitable, but given the complementary nature of our operations this should
only affect around 10% of employees. This will be managed with the same sense
of responsibility as we have done in the past.
Today we are also announcing how the merged company will be managed in order
to reflect a balance between the two organizations, taking into account the
best talents of each company and the multicultural nature of its workforce.
Beginning immediately after closing, there will be a Management Committee that
will work towards this end, while ensuring continuity in the management of the
two companies. This Management Committee of the combined company will be
headed by Patricia Russo, CEO, will also consist of Mike Quigley, COO; Frank
D'Amelio, Senior EVP, who will oversee the integration and the operations ;
Jean-Pascal Beaufret, CFO; Etienne Fouques, EVP, who will supervise the
emerging countries strategy; and Claire Pedini, Senior VP, Human Resources.
Additional organization and management team announcements will be made at a
future date.
As a result, the executive committee that will manage Alcatel in the coming
months will be modified according to the attached organizational announcement.
The deal was accomplished today due to your effort and hard work over the last
years and I thank you for this. Once again I ask you to use your extraordinary
capacity for change and characteristic reliability, which are essential
strengths for our future. I know I can rely on you.
Patricia Russo and I will address all employees via video on Monday on the
Intranet.
Serge Tchuruk
SAFE HARBOR FOR FORWARD LOOKING STATEMENTS
This document contains statements regarding the proposed transaction between
Lucent and Alcatel, the expected timetable for completing the transaction,
future financial and operating results, benefits and synergies of the proposed
transaction and other statements about Lucent and Alcatel's managements' future
expectations, beliefs, goals, plans or prospects that are based on current
expectations, estimates, forecasts and projections about Lucent and Alcatel and
the combined company, as well as Lucent's and Alcatel's and the combined
company's future performance and the industries in which Lucent and Alcatel
operate and the combined company will operate, in addition to managements'
assumptions. These statements constitute forward-looking statements within the
meaning of the U.S. Private Securities Litigation Reform Act of 1995. Words such
as "expects," "anticipates," "targets," "goals," "projects," "intends," "plans,"
"believes," "seeks," "estimates," variations of such words and similar
expressions are intended to identify such forward-looking statements which are
not statements of historical facts. These forward-looking statements are not
guarantees of future performance and involve certain risks, uncertainties and
assumptions that are difficult to assess. Therefore, actual outcomes and results
may differ materially from what is expressed or forecasted in such
forward-looking statements. These risks and uncertainties are based upon a
number of important factors including, among others: the ability to consummate
the proposed transaction; difficulties and delays in obtaining regulatory
approvals for the proposed transaction; difficulties and delays in achieving
synergies and cost savings; potential difficulties in meeting conditions set
forth in the definitive merger agreement entered into by Lucent and Alcatel;
fluctuations in the telecommunications market; the pricing, cost and other risks
inherent in long-term sales agreements; exposure to the credit risk of
customers; reliance on a limited number of contract manufacturers to supply
products we sell; the social, political and economic risks of our respective
global operations; the costs and risks associated with pension and
postretirement benefit obligations; the complexity of products sold; changes to
existing regulations or technical standards; existing and future litigation;
difficulties and costs in protecting intellectual property rights and exposure
to infringement claims by others; and compliance with environmental, health and
safety laws. For a more complete list and description of such risks and
uncertainties, refer to Lucent's Form 10-K for the year ended September 30, 2005
and Alcatel's Form 20-F for the year ended December 31, 2005 as well as other
filings by Lucent and Alcatel with the US Securities and Exchange Commission.
Except as required under the US federal securities laws and the rules and
regulations of the US Securities and Exchange Commission, Lucent and Alcatel
disclaim any intention or obligation to update any forward-looking statements
after the distribution of this press release, whether as a result of new
information, future events, developments, changes in assumptions or otherwise.
IMPORTANT ADDITIONAL INFORMATION WILL BE FILED WITH THE SECURITIES
AND EXCHANGE COMMISSION
In connection with the proposed transaction, Alcatel and Lucent intend to file
relevant materials with the Securities and Exchange Commission, including the
filing by Alcatel with the Securities and Exchange Commission of a Registration
Statement on Form F-6 and a Registration Statement on Form F-4 (collectively,
the "Registration Statements"), which will include a preliminary prospectus and
related materials to register the American Depositary Shares (each, an "ADS"),
as well as the Alcatel ordinary shares underlying such ADSs, to be issued in
exchange for Lucent common shares, and Lucent and Alcatel plan to file with the
Securities and Exchange Commission and mail to their respective stockholders a
Proxy Statement/Prospectus relating to the proposed transaction. The
Registration Statements and the Proxy Statement/Prospectus will contain
important information about Lucent, Alcatel, the transaction and related
matters. Investors and security holders are urged to read the Registration
Statements and the Proxy Statement/Prospectus carefully when they are available.
Investors and security holders will be able to obtain free copies of the
Registration Statements and the Proxy Statement/Prospectus and other documents
filed with the Securities and Exchange Commission by Lucent and Alcatel through
the web site maintained by the Securities and Exchange Commission at
www.sec.gov. In addition, investors and security holders will be able to obtain
free copies of the Registration Statements and the Proxy Statement/Prospectus
when they become available from Lucent by contacting Investor Relations at
www.lucent.com, by mail to 600 Mountain Avenue, Murray Hill, New Jersey 07974 or
by telephone at 908-582-8500 and from Alcatel by contacting Investor Relations
at www.alcatel.com, by mail to 54, rue La Boetie, 75008 Paris, France or by
telephone at 33-1-40-76-10-10.
Lucent and its directors and executive officers also may be deemed to be
participants in the solicitation of proxies from the stockholders of Lucent in
connection with the transaction described herein. Information regarding the
special interests of these directors and executive officers in the transaction
described herein will be included in the Proxy Statement/Prospectus described
above. Additional information regarding these directors and executive officers
is also included in Lucent's proxy statement for its 2006 Annual Meeting of
Stockholders, which was filed with the Securities and Exchange Commission on or
about January 3, 2006. This document is available free of charge at the
Securities and Exchange Commission's web site at www.sec.gov and from Lucent by
contacting Investor Relations at www.lucent.com, by mail to 600 Mountain Avenue,
Murray Hill, New Jersey 07974 or by telephone at 908-582-8500.
Alcatel and its directors and executive officers may be deemed to be
participants in the solicitation of proxies from the stockholders of Lucent in
connection with the transaction described herein. Information regarding the
special interests of these directors and executive officers in the transaction
described herein will be included in the Proxy Statement/Prospectus described
above. Additional information regarding these directors and executive officers
is also included in Alcatel's Form 20-F filed with the Securities and Exchange
Commission on March 31, 2006. This document is available free of charge at the
Securities and Exchange Commission's web site at www.sec.gov and from Alcatel by
contacting Investor Relations at www.alcatel.com, by mail to 54, rue La Boetie,
75008 Paris, France or by telephone at 33-1-40-76-10-10.