Inv Reporter says tender Newbridge shares to Alcatel
Newbridge Networks Corp NNC
Shares issued 180,104,582 Mar 28 close $50.60
Tue 28 Mar 2000 In the News
In the March 24 issue, The Investment Reporter advises tendering shares in
Newbridge Network ($51.25) to Alcatel Alsthom's bid. For each share Alcatel
will pay a security exchangeable into 0.81 of an ADR (American depository
receipt which allows trading in foreign stocks). Alcatel's ADRs trade at
$48.69 (U.S.). This works out to $71.01 (Canadian) -- a premium of 36.6 per
cent over Newbridge's share price. In addition, the Reporter notes that
Alcatel's exchangeable security defers capital gains taxes. Advantages of
this bid include giving Newbridge an owner that had sales of $23-billion
euros last year ($32-billion (Canadian)), access to Alcatel's operations in
130 countries, and $150-million (Canadian) in cost savings. The deal
requires anti-trust clearance, approval by the Canadian Foreign Investment
Review, approval by a Canadian court, and the go-ahead from Newbridge and
Alcatel shareholders. In the Jan. 21, 2000, issue, the Reporter advised
holding Newbridge at $35, pending a buyout or recovery.
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