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Alcatel-Lucent overthrows estimates after Qualcomm announced stake purchase
Qualcomm Inc. agreed to buy a minority stake in Alcatel-Lucent SA, which made the latter's stock to increase after the said announcement was made.
In a statement given today, Alcatel-Lucent's operating profit was valued at Eur24 million. This was excluding reorganization and impairment costs as its sales increased by 1.9% to Eur3.61 billion. On the other hand, analysts forecasted a loss and a revenue drop by the second quarter.
Alcatel-Lucent's CEO Michel Combes will have to face with asset sales and job cuts in the months to come. This was after his efforts of reorganizing the company but garnered a loss of more than US$10 billion since its inception through a merger in 2006. Combes is also in discussion with other possible partners. This includes Qualcomm Inc, who would eventually become a shareholder in the company.
Alcatel-Lucent is looking up to five partners to acquire a combined minority stake that is not more than 5% in total, said Combes. He added that Qualcomm Inc. would invest below 5% in part of the terms of their joint research project. The said project was for the development of small-cell base stations in malls, campuses and universities.