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, Alcatel and Lucent Technologies, Inc. issued a joint
press release. The text of the joint press release follows.
[ALCATEL GRAPHIC OMITTED] [LUCENT GRAPHIC OMITTED]
Press release
Alcatel and Lucent Technologies
to merge and form world's leading communication solutions provider
o Combined company will have strong financial base and revenues of
approximately Euro 21 billion (USD 25 billion) based on calendar 2005
results
o Creates new growth opportunities and identifies annual pre-tax cost
synergies of approximately Euro 1.4 billion (USD 1.7 billion) within
three years
o Creates global convergence leader with most comprehensive wireless,
wireline and services portfolio in the industry
o Features one of the largest global R&D capabilities in communications
o Serge Tchuruk to be non-executive chairman, Patricia Russo to be CEO,
based in Paris; equal board representation from both companies in
merger of equals
Paris and Murray Hill, N.J., April 2, 2006 -- Alcatel (Paris: CGEP.PA and NYSE:
ALA) and Lucent Technologies (NYSE: LU) today announced that they have entered
into a definitive merger agreement to create the first truly global
communications solutions provider with the broadest wireless, wireline and
services portfolio in the industry. The primary driver of the combination is to
generate significant growth in revenues and earnings based on the market
opportunities for next-generation networks, services and applications, while
yielding significant synergies. The combined company's increased scale, scope
and global capabilities will enhance its long-term value for shareowners,
customers and employees.
The transaction, which was approved by the boards of directors of both
companies, will build upon the complementary strengths of each company to create
a global leader in the transformation of next-generation wireless, wireline and
converged networks.
Strategic Fit Creates Global Leader in Next-Generation Networks and Services
----------------------------------------------------------------------------
"This combination is about a strategic fit between two experienced and
well-respected global communications leaders who together will become the global
leader in convergence," said Serge Tchuruk, Chairman and CEO of Alcatel who will
become non-executive chairman of the combined company. "A combined Alcatel and
Lucent will be global in scale, have clear leadership in the areas that will
define next-generation networks, boast one of the largest research and
development capabilities focused on communications, and employ the largest and
most experienced global services team in the industry. It will create enhanced
value for shareholders of both companies who will benefit from owning the most
dynamic, global player in the communications industry."
Patricia Russo, Chairman and CEO of Lucent who will become CEO of the combined
company said, "The strategic logic driving this transaction is compelling. The
communications industry is at the beginning of a significant transformation of
network technologies, applications and services -- one that is projected to
enable converged services across service-provider networks, enterprise networks
and an array of personal devices. This presents extraordinary opportunities for
our combined company to accelerate its growth. The combination creates a new
industry competitor with the most comprehensive portfolio that will be poised to
deliver significant benefits to customers, shareowners and employees."
Overview of Strategic Combination
---------------------------------
The combined company, which will be named at a later date, will have an
aggregate market capitalization of approximately Euro 30 billion (USD 36
billion), based upon the closing prices on Friday, March 31. Based on calendar
2005 sales, the combined company will have revenues of approximately Euro 21
billion (USD 25 billion), divided almost evenly among North America, Europe and
the rest of the world. As of December 31, 2005, the combined companies had about
88,000 employees.
The combined company will have:
o A strong financial base and achieve annual pre-tax cost synergies of
about Euro 1.4 billion (USD 1.7 billion) within three years, a
substantial majority of which is expected to be achieved in the first
two years
o The largest and most experienced global services and support
organization in the industry
o A leading position in communications solutions, with the broadest
wireless and wireline portfolio o Deep and strong, long-term
relationships with every major service provider around the world
o A growing momentum in high-end enterprise technologies and markets,
including mission critical safety and security applications
o The industry's premier R&D capabilities, including Bell Labs, with
26,100 R&D engineers and scientists throughout the world
o An experienced international management team with a common vision and
proven track record
o An enhanced global foot print and diversified customer base with a
presence in more than 130 countries
The cost synergies are expected to be achieved within three years of closing and
will come from several areas, including consolidating support functions,
optimizing the supply chain and procurement structure, leveraging R&D and
services across a larger base, and reducing the combined worldwide workforce by
approximately 10 percent. The merger also will result in approximately Euro 1.4
billion (USD 1.7 billion) in new cash restructuring charges, with the charges to
be recorded primarily in the first year. A substantial majority of the
restructuring is expected to be completed within 24 months after closing. The
transaction is expected to be accretive to earnings per share in the first year
post closing with synergies, excluding restructuring charges and amortization of
intangible assets.
A Globally Managed Company
--------------------------
The combined company will be managed by a team that reflects 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.
Between signing and closing, Serge Tchuruk and Patricia Russo will supervise an
integration team to be nominated shortly, which will seek to ensure that
synergies will start to be realized as soon as closing takes place.
Overview of the Transaction
---------------------------
Under the terms of the agreement, Lucent shareowners will receive 0.1952 of an
ADS (American Depositary Share) representing ordinary shares of Alcatel (as the
combined company) for every common share of Lucent that they currently hold.
Upon completion of the merger, Alcatel shareholders will own approximately 60
percent of the combined company and Lucent shareholders will own approximately
40 percent of the combined company. The combined company's ordinary shares will
continue to be traded on the Euronext Paris and the ADSs representing ordinary
shares will continue to be traded on the New York Stock Exchange.
The combined company created by this merger of equals is incorporated in France,
with executive offices located in Paris. The North American operations will be
based in New Jersey, U.S.A., where global Bell Labs will remain headquartered.
The board of directors of the combined company will be composed of 14 members
and will have equal representation from each company, including Tchuruk and
Russo, five of Alcatel's current directors and five of Lucent's current
directors. The board will also include two new independent European directors to
be mutually agreed upon.
The combined company intends to form a separate, independent U.S. subsidiary
holding certain contracts with U.S. government agencies. This subsidiary would
be separately managed by a board, to be composed of three independent U.S.
citizens acceptable to the U.S. government. This type of structure is routinely
used to protect certain government programs in the course of mergers involving a
non-U.S. party.
The combined company will remain the industrial partner of Thales and a key
shareholder alongside the French state. Directors to the Thales board who are
nominated by the combined company would be European Union citizens. Serge
Tchuruk, or a French director or a French corporate executive of the combined
company would be the principal liaison with Thales. Furthermore, the board of
Alcatel has approved the continuation of negotiations with Thales with a view to
reinforce the partnership through the contribution of certain assets and an
increased shareholding position in Thales.
The merger is subject to customary regulatory and governmental reviews in the
United States, Europe and elsewhere, as well as the approval by shareholders of
both companies and other customary conditions. The transaction is expected to be
completed in six to twelve months. Until the merger is completed, both companies
will continue to operate their businesses independently.
Commitments to customers and stakeholders
-----------------------------------------
"Our customers will benefit from a partner with the scale and scope to design,
build and manage increasingly converged networks that deliver the most advanced
communications services to the market. That is what this combination will
deliver with an unparalleled focus on execution, innovation and service for our
customers," said Patricia Russo. "Serge and I will work hard with our leadership
team to draw upon the key strengths and common culture of technical excellence
within each company to uniquely position the combined company for success,
growth and value creation from next-generation networking and services."
"We are committed to moving forward aggressively after closing and quickly
combining our operations and integrating our corporate cultures to ensure that
we capture the full benefits of this combination for our customers, our
shareowners and our employees," Serge Tchuruk said. "We share a vision of where
networks are going; a commitment to world-class customer service; and a highly
skilled, motivated and global workforce. We are excited about the tremendous
opportunity to establish the course for this future together."
About Alcatel
Alcatel provides communications solutions to telecommunication carriers,
Internet service providers and enterprises for delivery of voice, data and video
applications to their customers or employees. Alcatel brings its leading
position in fixed and mobile broadband networks, applications and services, to
help its partners and customers build a user-centric broadband world. With sales
of EURO 13.1 billion and 58,000 employees in 2005, Alcatel operates in more than
130 countries. For more information, visit Alcatel on the Internet:
http://www.alcatel.com
Alcatel Press Contacts
Regine Coqueran Tel: + 33 (0)1 40 76 49 24 regine.coqueran@alcatel.com
---------------------------
Mark Burnworth Tel: + 33 (0)1 40 76 50 84 mark.burnworth@alcatel.com
-------------------------
Alcatel Investor Relations
Pascal Bantegnie Tel: +33 (0)1 40 76 52 20 pascal.bantegnie@alcatel.com
----------------------------
Nicolas Leyssieux Tel: +33 (0)1 40 76 37 32 nicolas.leyssieux@alcatel.com
-----------------------------
Maria Alcon Tel: +33 (0)1 40 76 15 17 maria.alcon@alcatel.com
-----------------------
Charlotte Laurent-Ottomane Tel: +1 703 668 7016 charlotte.laurent-ottomane@alcatel.com
--------------------------------------
About Lucent
Lucent designs and delivers the systems, services and software that drive
next-generation communications networks. Backed by Bell Labs research and
development, Lucent uses its strengths in mobility, optical, software, data and
voice networking technologies, as well as services, to create new
revenue-generating opportunities for its customers, while enabling them to
quickly deploy and better manage their networks. Lucent's customer base includes
communications service providers, governments and enterprises worldwide. For
more information on Lucent, which has headquarters in Murray Hill, N.J., U.S.A.,
visit http://www.lucent.com.
Lucent Press Contacts
Bill Price Tel :+ 1 908-582-4820 williamprice@lucent.com
-----------------------
Joan Campion Tel :+ 1 908-582-5832 joancampion@lucent.com
----------------------
Lucent Investor Relations
John DeBono Tel : +1 908-582-7793 debono@lucent.com
-----------------
Dina Fede Tel : +1 908-582-0366 fede@lucent.com
---------------
Legal and Financial Advisors
Alcatel's financial advisors on this transaction were Goldman Sachs, with
Skadden, Arps, Slate, Meagher & Flom LLP as legal counsel. Lucent's financial
advisors were JPMorgan and Morgan Stanley and Wachtell, Lipton, Rosen & Katz as
legal counsel
# # #
Editor's Note: A global media and analysts/investors conference call will be
held today at 5 p.m., Paris time (11 a.m. Eastern time) with Serge Tchuruk and
Patricia Russo. The conference will be available via a live webcast at
http://www.alcatel.com/conferences or http://www.lucent.com.
An in-person press conference will be held tomorrow in Paris at 1 p.m., Paris
time (7 a.m., Eastern Time) with Serge Tchuruk and Patricia Russo. The
conference will also be available via a live webcast at
http://www.alcatel.com/conferences or http://www.lucent.com.
An in-person conference for analysts/investors will be held tomorrow in Paris,
at 3 p.m., Paris time (9 a.m., Eastern time). The conference will also be
available via a live webcast at http://www.alcatel.com/conferences or
http://www.lucent.com.
Replays of the webcast will be available via the same Web addresses.
SAFE HARBOR FOR FORWARD LOOKING STATEMENTS
This press release 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 SEC
In connection with the proposed transaction, Alcatel and Lucent intend to file
relevant materials with the Securities and Exchange Commission (the "SEC"),
including the filing by Alcatel with the SEC 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, a final prospectus
and related materials to register the Alcatel American Depositary Shares
("ADSs"), as well as the Alcatel ordinary shares underlying such Alcatel ADSs,
to be issued in exchange for Lucent common shares, and Lucent and Alcatel plan
to file with the SEC and mail to security holders 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 Information Statement/Proxy
Statement/Prospectus and other documents filed with the SEC by Lucent and
Alcatel through the web site maintained by the SEC at www.sec.gov. In addition,
investors and security holders will be able to obtain free copies of the
Registration Statements and the Information Statement/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 SEC on or about January 3, 2006. This
document is available free of charge at the SEC'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 information statements for its 2005 Assemblee
Generale Mixte Ordinaire Et Extraordinaire. These documents are available 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.