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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: StanX Long who wrote (62304)	3/25/2002 12:56:09 AM
From: StanX Long	Read Replies (1) \| Respond to of 70976

Nortel May Sell Convertible Securities for Cash, Investors Say By Justin Baer quote.bloomberg.com Brampton, Ontario, March 23 (Bloomberg) -- Nortel Networks Corp., North America's second-biggest maker of telephone equipment, may sell convertible securities to raise cash as it braces for another year of flagging demand, investors said. Last week, Lucent Technologies Inc. sold $1.75 billion in convertible preferred shares, about 17 percent more than planned. Finding willing buyers for the securities, which grant holders the right to exchange them for common stock under certain conditions, and facing a dimming outlook for equipment spending in 2003, Nortel may follow Lucent with its own offering, investors said. ``It seems very likely that that's going to happen,'' said Ravi Malik, a managing director at Froley Revy Investment Co., which manages $2.3 billion and owns some Nortel convertible securities from past offerings. ``It's always prudent to buy insurance because things can deteriorate.'' Nortel, which had $3.5 billion in cash as of Dec. 31, has shed businesses, product lines and almost half its workforce to stem losses amid a slowdown in spending by the world's phone companies. Recent decisions by Sprint Corp. and other big carriers to further trim budgets has cast doubt that Nortel can meet its goal of breaking even in the fourth quarter, investors said. While Nortel has enough cash and available credit lines to fuel its businesses, the company probably will raise more money now to pay for expenses it may incur if it cuts more jobs, Malik said. Nortel might also generate cash by selling more businesses, including part of its wireless-networking unit, investors said.