Alcatel makes initial offer on Lucent fiber business

French communications equipment manufacturer Alcatel said yesterday it has made an “initial offer” to purchase cash-strapped Lucent Technologies fiber optic cable division.

Though Alcatel CEO Serge Tchuruk did not provide a specific dollar amount, published reports said the offer was $5 billion and that Alcatel has made moves toward securing a $6.3 billion loan with banks.

Industry analysts have speculated the Lucent’s fiber business could fetch between $4 billion and $8 billion, but the sale price depends on the number of potential buyers that come to the table, said Bruce Hyman, director for communications equipment at Standard & Poor’s.

“If there’s one buyer the price may be much less than it’s worth,” Hyman said. “If there’s more than one, the price could be somewhat more than it’s worth as a matter of keeping it away from someone else.”

In addition to Alcatel, rumors about potential buyers have included Corning, JDS Uniphase and Pirelli. But Lucent’s need for quick cash could expedite a final deal and Alcatel appears to be the most likely candidate, said Nancee Ruzicka, an analyst at The Yankee Group.

“Corning could do it, but they’d end up with SEC trouble because it would give them [a hold on] the market,” Ruzicka said. “And JDS Uniphase doesn’t seem to be in the position to raise that kind of cash at the moment.”

Although a sale won’t solve all of Lucent’s financial difficulties, it would at least numb the pain while the company continues its restructuring plan.

“It gives them some cash to keep going while some of these other things turnaround,” Ruzicka said.