When Alcatel and Lucent agreed to merge in April 2006, there were the typical phrases in the press release: "new growth opportunities," "cost synergies," "global convergence," "increased scale," "global capabilities" and so on. Oh, and yes, it would "create enhanced value for shareholders."

Yet, there was something that was curious. The CEO of the new entity, Patricia Russo, said she would not learn French, even though Alcatel was based in France. Might this be a sign that there would be some cultural issues?

Alas, the fact remains that the benefits of the deal haven't materialized as Alcatel-Lucent's (NYSE: ALU) stock price has gone from $14.50 to $7.50.

Well, this week, Alcatel-Lucent had its annual meeting. No doubt, it wasn't fun as shareholders provided an earful. After all, the company had to write down $4.55 billion in asset value because of the merger (there were also thousands of layoffs).

Interestingly enough, shareholders passed a resolution that allows Alcatel-Lucent's board to rid its chairman/CEO with a majority vote instead of a two-thirds of a vote.

Unfortunately, I don't see this amounting to much. Keep in mind that -- with consolidation of wireless carriers -- its tough for equipment providers to get any leverage. Plus, the competition is still intense.

By the way, Russo apparently is learning to speak French now. And she even spoke some words at the meeting. However, she will need to learn a more important language: profits.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

Alcatel-Lucent's deal from Hell originally appeared on BloggingStocks on Sun, 01 Jun 2008 14:40:00 EST. Please see our terms for use of feeds.

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Analyst downgrades 7-31-07: GT, PTR, RSH and UL originally appeared on BloggingStocks on Tue, 31 Jul 2007 10:51:00 EST. Please see our terms for use of feeds.

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Analyst upgrade 4-15-07: ABFS, ALU, AMZN and CAKE upgraded today originally appeared on BloggingStocks on Wed, 25 Apr 2007 11:33:00 EST. Please see our terms for use of feeds.

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Analyst initiations 4-23-07: AET, ALU and UNH initiated today originally appeared on BloggingStocks on Mon, 23 Apr 2007 11:13:00 EST. Please see our terms for use of feeds.

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Analyst downgrades 3-22-07: Aeropostale, Motorola & Alcatel-Lucent downgraded today originally appeared on BloggingStocks on Thu, 22 Mar 2007 11:08:00 EST. Please see our terms for use of feeds.

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• JMP Securities started Research in Motion Ltd (NASDAQ: RIMM) with a Market Perform rating as the firm has concerns about RIMM's enterprise-focused prospects in the hits driven, high-end consumer market.

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Analyst initiations 2-28-07: Burker King started with a flame-broiled Buy at AG Edwards originally appeared on BloggingStocks on Wed, 28 Feb 2007 11:29:00 EST. Please see our terms for use of feeds.

MAJOR PAPERS:

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Newspaper wrap-up 2-23-07: Apple at CeBIT? originally appeared on BloggingStocks on Fri, 23 Feb 2007 09:45:00 EST. Please see our terms for use of feeds.

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Analyst initiations 2-08-07: Sirius & XM Satellite initiated at Wedbush originally appeared on BloggingStocks on Thu, 08 Feb 2007 11:34:00 EST. Please see our terms for use of feeds.

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Newspaper wrap-up 2-8-07: Job cuts abroad originally appeared on BloggingStocks on Thu, 08 Feb 2007 09:19:00 EST. Please see our terms for use of feeds.

• Sales up 27%, the fastest stand-alone growth in years. Way above Cisco's long-term growth objective of 10 to 15%
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Cisco's results simply amazing originally appeared on BloggingStocks on Wed, 07 Feb 2007 07:00:00 EST. Please see our terms for use of feeds.

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• Credit Suisse initiated Level 3 Communications (NASDAQ: LVLT) with an Outperform rating and $7.50 target; the firm expects Level 3 to continue to benefit from strong demand for higher data usage.

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Analyst Initiations 1-11-07: Level 3 started with an Outperform originally appeared on BloggingStocks on Thu, 11 Jan 2007 11:38:00 EST. Please see our terms for use of feeds.

The Financial Times of London has an interesting article about how the leadership in telecom technology is moving out of the U.S.. With the old Bell Labs, which became, Lucent, merging with French firm Alcatel to create Alcatel-Lucent (NYSE:ALU) and Chinese companies building high tech switches and routers, the U.S. seems to be running behind.

The FT wants to make the case that "the next generation of ideas is coming more from London, Seoul, and Brussels." Nice theory. No evidence.

The revolution in WiMax is being lead by Motorola Inc. (NYSE:MOT) and Intel Corp. (NASDAQ:INTC). WiMax pioneer, Clearwire, is U.S. based. Qualcomm Inc. (NASDAQ:QCOM) has its problems, but it is still the leader in global cell phone chip technology. Its rivals, Texas Instruments (NYSE:TXN) and Broadcom Corp. (NASDAQ:BRCM) are here.

The king of global routing, Cisco Systems Inc. (NASDAQ:CSCO), is based in the U.S.. Juniper Networks (NASDAQ:JNPR) is still in the U.S., until someone from overseas buy it. By the same token, a U.S. company like Motorola could buy Canadian telephone tech company Nortel Networks Corp. (NYSE:NT).

I think by now it's clear I disagree with the Financial Times of London. I also think I've made my case!

Is telecom tech moving overseas? originally appeared on BloggingStocks on Fri, 22 Dec 2006 09:25:00 EST. Please see our terms for use of feeds.