Nokia Oyj is in talks to purchase smaller telecom equipment maker Alcatel-Lucent , a deal combining the industry's two weakest players that is backed by the French government but could pose challenges in cutting costs.In a joint announcement, the Finnish and French companies said they were in "advanced discussions" on a "full combination, which would take the form of a public exchange offer by Nokia for Alcatel-Lucent". The two, which have been seen as a possible combination for the last several years, cautioned that the discussions could still fall apart.Shares in Alcatel, a group worth about 11 billion euros based on Monday's closing share price, rose about 16 percent. Shares in Nokia, worth about 29 billion euros, fell as much as 7 percent in morning trade before paring back losses to end down 3.6 percent. France's Le Monde newspaper reported that a further announcement could come as early as Wednesday.The pair are a good fit in terms of products and geographies, and bulking up would help them cut costs as they try to compete with mobile market leader Sweden's Ericsson and low-cost powerhouse China's Huawei.
Alcatel Lucent SA is a France based company that proposes solutions used by service providers, businesses, and governments worldwide to offer voice, data, and video services to their own customers. Shares of ALU traded higher by 8.851% or $0.385/share to $4.74. In the past year, the shares have traded as low as $2.28 and as high as $4.77. On average, 7166350 shares of ALU exchange hands on a given day and today's volume is recorded at 36961568.
Telefonaktiebolaget LM Ericsson (Ericsson) is an information and communications technology (ICT) solutions provider. Shares of ERIC traded higher by 0.347% or $0.045/share to $13.00. In the past year, the shares have traded as low as $11.20 and as high as $13.28. On average, 3663530 shares of ERIC exchange hands on a given day and today's volume is recorded at 2496678.