ISS urges Lucent, Alcatel holders to approve deal
PHILADELPHIA, Aug 24 (Reuters) Proxy advisory firm Institutional Shareholder Services Inc. on Thursday recommended that shareholders approve Lucent Technologies Inc.'s planned .4 billion acquisition by France's Alcatel.
''Although some degree of skepticism is warranted when evaluating any so-called merger of equals and the slide in share price of both Lucent and Alcatel is cause for concern ...
we believe the proposed transaction warrants Lucent and Alcatel shareholder support,'' ISS said in a report.
The value of the deal has dropped about 23 percent since it was announced in April amid a slide in the companies' stock prices. Still, ISS said it supports the deal based on the ''compelling strategic rationale, attractive synergies and conservation valuation.'' Some investors and analysts have said Alcatel is overpaying for Lucent, which posted a 79 percent drop in third-quarter profits amid lower sales of wireless network equipment in North America.
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