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Technology Stocks : Lucent Technologies (LU) -- Ignore unavailable to you. Want to Upgrade?

To: shortilong who wrote (21016)	10/22/2002 1:12:30 PM
From: GVTucker	Respond to of 21876

Can LUcent (or any other company for that matter) file for bankruptcy protection just because it would be more convenient to run a company without debt and without all those pesky shareholders? Well, no matter what road they take, someone is going to be a pesky shareholder. There's always an owner to a company. Even in a worst case scenario, bondholders would end up being the shareholders. There's just no way to get rid of them unless someone like Bill Gates does a personal LBO. Also, if LU filed Chapter 11 but actually did have sufficient assets to continue as a going concern even if you include the debt, most likely the common shareholders would file suit to prevent their shares from being stolen away from them. Note that contrary to the current myth, most every mutual fund can still own LU. Scan through the top 100 holders of LU common and you've got just about every large investor out there. There's plenty of power to prevent a frivolous Chapter 11 filing. If LU ever files, it will be because the debtholders push them there, not because management wants to be there.

To: shortilong who wrote (21016)	10/22/2002 2:12:09 PM
From: John Soileau	Read Replies (1) \| Respond to of 21876

IMO all they need to get in the BK door is a present or very imminent inability to pay their obligations as they come due. With the $4.5B now in the bank, BK is not likely in coming months. But if they end up later with less than $1B in the bank, and a continuing cash burn, they would be quite a BK candidate. Hence the stock price. So long as they are not in default of their payment obligations (and it appears that at present they are not), a debtor-forced involuntary BK filing is not really a threat. If they default, that threat gets much more real. John