Beset by hard times, but looking to right the company's financial ship, Lucent Technologies Inc. said late Tuesday that it expects to raise US$1 billion through a private stock offering.
Lucent will make an offering of redeemable convertible preferred stock in order to increase the company's cash reserves, said Frank Briamonte, corporate media relations officer with Lucent. The stock will be offered to qualified institutional buyers, he said. Briamonte was unable to disclose further details about the plan due to legal regulations surrounding the offering, he said.
The company has faced tough financial times recently, reporting a loss of $1.89 billion for the third quarter of 2001 on July 24. Lucent also announced layoffs of between 15,000 and 20,000 employees at the same time, adding to 19,000 already laid off. Some cost cutting moves have been made though and the company expects to save millions from the layoffs as well as from sales of manufacturing facilities in Ohio, Oklahoma and China.
Though Lucent has enough money to complete its turnaround, the stock offering is a good opportunity to raise additional funds, Briamonte said.