Lucent May Fall on Worries About Customer Loans, Barron's Says
9/2/00 2:05:00 PM
Source: Bloomberg News
URL: cnetinvestor.com
Murray Hill, New Jersey, Sept. 2 (Bloomberg) -- Lucent Technologies Inc. may fall on concerns that the maker of telecommunications equipment will write off some of its $8.7 billion in loans and loan commitments to customers, Barron's said.
Lucent is trying to sell some of the loans it made to Winstar Communications Inc., part of a $2 billion financing to help the company buy Lucent products, even as Winstar tries to issue more debt, the paper said. Lucent had tried to sell the loans in June for less than 90 cents on the dollar, causing Winstar's junk bonds to fall, Barron's said, without citing its sources.
Other big equipment makers like Nortel Networks Corp., Ericsson AB, Nokia Oyj, and Cisco Systems Inc., also lend money to clients that build telecommunications networks as competition to sell equipment to them increases. Cisco, Ericsson, Lucent, Nokia and Nortel have $6.1 billion outstanding in loans and loan guarantees, the paper reported. That doesn't include loans they've agreed to make in the future, Barron's said.
Buyers of equipment -- especially local-exchange carriers -- are finding it difficult to get financing from the equity and junk bond markets, adding to the pressure on manufacturers to lend money to them as part of an equipment sale, the paper said. (Barron's 9/4 17) (To view the Barron's Web site on the Bloomberg, see {BARR GO}.) |
