Alcatel and Lucent Technologies had a productive Memorial Day weekend talking over their $32 billion mega-merger and are set to finalize and announce the deal by Wednesday, the Wall Street Journal reported on Monday.
The deal would be structured as an all-stock acquisition of Lucent by France’s Alcatel, as first reported by the New York Times back on May 18. However, Alcatel would pay little to no premium over Lucent’s current stock price. Final details still need to be hammered out including what would happen if Alcatel sharescontinued to drop.
The companies plan to scrap their current corporate identities and will propose a new name for the combine entity, which would likely be headquartered in the U.S. even though it would be legally incorporated in France.
The merger will result in estimated cost savings of about $4 billion, the Journal reported.
Both companies had no comment on the merger talks.
The merger isn’t likely to affect Lucent’s current financial overhaul. Lucent is expected to continue with its planned carve-out of Agere Systems Inc., the communications semiconductors company that was spun off in March. More than one billion shares in Agere will be distributed to shareholders by Sept. 30.