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Technology Stocks : Alcatel (ALA) and France -- Ignore unavailable to you. Want to Upgrade?

To: bertrand bidaud who wrote (442)	3/2/1999 10:36:00 AM
From: Steve Fancy	Respond to of 3891

Xylan to boost Alcatel (SBF:CGEP) EPS in 2001 ReutersPlus, Tuesday, March 02, 1999 at 10:22 PARIS, March 2 (Reuters) - The planned acquisition of Xylan Corp (NASDAQ:XYLN) will boost Alcatel's 2000 earnings per share before goodwill writeoffs on the acquisition, Alcatel Finance Director Jean-Pierre Halbron said on Tuesday. He told a news conference the acquisition would boost EPS after goodwill writeoffs in 2001 and would be "significantly positive" before goodwill writeoffs. Halbron said Alcatel was paying 45 times reported 1998 EPS and, based on analysts' expectations for a 20 percent profit rise in 1999 at Xylan, was paying about 30 times estimated 1999 earnings. Alcatel Chairman Serge Tchuruk told the news conference the group would announce another acquisition very soon, in the $200-300 million range, in the area of remote access. He declined to elaborate. Copyright 1999, Reuters News Service

To: bertrand bidaud who wrote (442)	3/2/1999 10:38:00 AM
From: Steve Fancy	Read Replies (1) \| Respond to of 3891

FOCUS-Alcatel (SBF:CGEP) buys Xylan (NASDAQ:XYLN) for $2 bln ReutersPlus, Tuesday, March 02, 1999 at 04:18 (Adds background, quotes, share prices) By Crispian Balmer PARIS, March 2 (Reuters) - French telecommunications firm Alcatel said on Tuesday it was buying U.S. Internet equipment maker Xylan Corp for some $2.0 billion to boost its profile in the rapidly expanding voice and data network business. Alcatel said in a statement it would make a cash offer of $37 a share for all outstanding Xylan stock, with the tender opening on March 8. It added that Xylan's board was recommending that its shareholders accept the bid. "Alcatel has devised and is implementing a comprehensive strategy to become a key worldwide player in the Internet field," company chairman Serge Tchuruk said in the statement. "The combined Alcatel/Xylan strengths in voice and data networking for enterprises will constitute a very powerful force in world corporate markets," he added. Xylan shares surged some 39 percent last week on speculation that Alcatel was set to launch a takeover bid. The stock closed on Monday up 7/16 at $26-15/16. Alcatel stock dipped 1.68 percent on Monday to close at 98 euros. Alcatel said completion of the deal was subject to 90 percent of the shares being tendered and compliance with anti-trust laws. The California-based Xylan makes high-bandwidth switching systems and is one of the fastest growing companies in the enterprise data field, Alcatel said. "The synergies from combining that technology with Alcatel's resources will provide a dramatic boost to Xylan's future success," Xylan's Chief Executive Officer Steve Kim said in a statement. Alcatel's move comes as telecommunication companies around the world scramble to develop their data transmission services to try to keep pace with the booming Internet market. Analysts predict that voice calls will soon represent only a tiny fraction of all telecommunications traffic. Alcatel has been a key Xylan customer and accounts for a significant portion of the U.S. firm's business. In all, Xylan has some 4,000 customers and revenues of around $348 million. "In each of the last two years, the company has grown approximately 65 percent, outstripping the growth of the data networking market," Alcatel said. It said Xylan would continue to sell through its existing distribution channels and would become Alcatel's centre of competence for all data networking projects. Alcatel, which operates in 130 countries, reported a net profit of 2.3 billion euros ($2.5 billion) in 1998, boosted by a two billion euro gain on asset sales, while gross operating income rose 10.2 percent to one billion euros. Tuesday's purchase follows a $315 million buy last October of Packet Engines Inc, another U.S. Internet technology company. Tchuruk said in January that his company was considering another "two or three" acquisitions in the United States this year in Internet technology companies, each in the order of several hundreds of millions of dollars. Tchuruk was due to hold a news conference at 1300 GMT. Alcatel hit the headlines last September when its stock plummeted 40 percent after issuing a profit warning. The stock opened up 2.75 percent on Tuesday at 99 euros. paris.newsroom@reuters.com)) ($1=.9185 Euro) Copyright 1999, Reuters News Service