Alcatel, Lucent begin talks on possible merger

Network equipment makers and market rivals Alcatel and Lucent Technologies are discussing a business merger, in what could be the start of consolidation among the companies that help power telephone and Internet networks, an Associated Press report said.

The report, quoting a joint statement from the two firms, said the merger with Lucent would allow Paris-based Alcatel to expand its presence in the US market and could trigger a new wave of consolidation among network equipment makers.

The companies had actually considered getting together before, the report said. In the spring of 2001, they were on the verge of a $23-billion merger when talks fell due to a disagreement over how much control Alcatel would have on the merged entity.

Media reports said Alcatel was negotiating to acquire Lucent for about $12.6 billion.