ALU is far superior company and will do much better than Nok.. I actually expect this so called merger to not solidify!!!
5 Reasons Activists Might Be Targeting Alcatel-Lucent
Jul. 2, 2015 4:50 PM ET | About: Alcatel-Lucent (ALU), Includes: NOK
Disclosure: I am/we are long ALU. (More...)
Known activist investment firm Elliott Management has taken a small stake in ALU.
Just ahead of the NOK merger, this likely means that Elliott will pursue some level of change within the offer.
Here are five possible scenarios, and my opinion on what's best for shareholders.
Activist investment firm Elliott Management disclosed a 1.3% stake in Alcatel-Lucent (NYSE:ALU) earlier this week, a move that will likely bring drama to the ongoing acquisition by Nokia (NYSE:NOK). Specifically, there are five possible scenarios that Elliott's involvement could mean for Alcatel-Lucent and its shareholders as the fund rarely invests in a company without some kind of motive.
Get a larger offer from Nokia
Since Nokia's proposed buyout of Alcatel-Lucent back in April, the latter's shareholders have demanded a higher price. Nokia's offer is equivalent to 0.55 of its share value. Based on today's closing stock price, the value for Alcatel-Lucent would be nearly $14 billion. That's a steep increase from its $10.5 billion valuation.
ALU data by YCharts
However, on April 14, one day before the merger announcement, Alcatel-Lucent's stock nearly hit $5. That valued the company at $13.7 billion. In other words, Alcatel-Lucent's value has decreased rapidly over the last two and a half months, following news of the merger, and with the stock price being so attached to the price of Nokia, it is very likely that Elliott will start an organized effort to get a better offer.
Hand over some cash
The sad reality is that no matter how well Alcatel-Lucent performs to this point, it is directly tied to the stock performance of Nokia. We saw this after each company's respective earning reports. In Alcatel's last quarter it grew nearly 10% behind strong performance in its wireless unit, which thereby also cause
This ALU deal is far from being over and Yes this deal smells and is not going through on these current trems. Watch what happens in the weeks to come. New bidders and/or a sweeter deal from Nokia. To many people have already expressed their opinions and if you think a bit it shows that this is a deal acting on a merger but its a takeover. At least based on the math. The math has to be sweeter...
NEW YORK (The Deal) -- Paul Singer's Elliott Management has acquired a 1.3% stake in Nokia's (NOK - Get Report) takeover target Alcatel-Lucent SA (ALU - Get Report) as the New York hedge fund manager continues to tap into ongoing deals to make money.
Elliott holds the stake indirectly and may be hoping to benefit from a sweetened offer or from future lawsuits.
Elliott didn't respond to a request for comment about its stake purchase, which comes after Odey Asset Management criticized Nokia's offer as too low. Odey, which owns 5.3% of Alcatel-Lucent shares, said Nokia and Alcatel are selling the deal as a merger when it is clearly a takeover that necessitates a bigger premium.
I believe this to be very true and ALU Holders will indeed get more for their shares. Watch and learn the politics of selling and buying stocks.
Well noted but I am looking for $12 with Nokia after the merger works and it settles as well to the new company..
Nokia shareholders will start to see visible benefits over the next 12 months, in my opinion. As these businesses are integrated, Nokia's margins, cash flows and revenues will grow and a strong foothold in one of the largest markets will allow the company to dominate this market for years to come. The regulatory hurdles are falling and the eventual merger is coming close. ALU shareholders, who decide to keep the shares of new combined company, also will benefit. However, these shareholders would have had a larger gain if management had not decided to accept the offer from Nokia.
The companies also need permission from more than 20 other competition regulators around the world, including in China and the European Union, according to Nokia.
I feel this Deal is Dead because NO CEO would leave early until it Closed!!!! We will hear News soon!!! Combes saud during a video his job would be to close the Deal and stay until it done....
Combes leaves ALU on 7/15 to join Altice on 9/15
2 months of fun in the sun for Combes.while Alcatel diehards still cling to his Shift plan and dream about selling Alcatel in pieces......Right now, the 25% vote against Camus' compensation package in the last ALU shareholders meeting probably indicates the level of Alcatel shareholders who will oppose the deal by not tendering their shares. Without a leader, that level will likely go down because the nourishing milk of Nokia cash flow will become too irresistible. Less
The deal is expected to close by mid-2016 subject to approval by both the company’s shareholders and the regulatory authorities. Notably, Nokia shareholders will command a 66.5% stake in the merged entity while Alcatel-Lucent shareholders will hold the remaining 33.5%.