Alcatel weighs Lucent merger; Ericsson next?

Alcatel's directors plan to meet on Thursday to discuss a $33 billion merger with Lucent Technologies. Analyst firm UBS says the merger looks good on paper given the potential for more than $1 billion in cost savings and the strong market position the combined company would gain in both wireline and wireless. Of course, the merger isn't without its risks, UBS said. For one, the cross-boarder integration of large and diverse organizations is extremely complicated, while significant job cuts will be required to both integrate and achieve cost synergies. And there is a risk for near-term business disruptions as the vendors look to close their deal.

Meanwhile, analysts are speculating about Ericsson's potential takeover targets, including Juniper and Nortel. But Ericsson has historically stayed away from acquisitions that are too dilutive, which would be the case with Juniper.

For more about the merger talk:
- check out this article from The Wall Street Journal (sub. req.)
- read this report from