Alcatel-Lucent has launched a bond offering worth about €1 billion ($1.4 billion) as it seeks to pay down debt as part of its broader turnaround strategy.

The bonds, which come in two tranches, can be exchanged for the company’s shares.

The aim is to repay debt taken on last year when Alcatel-Lucent was fighting for its life. Since then, CEO Michel Combes has stabilised the ship somewhat.

One tranche of approximately €600 million in bonds matures at end-January 2019 and the second of approximately €400 million matures at end-January 2020.

Both tranches could be increased by ten per cent depending on demand.

The proceeds from the bond offering will pay back some or all of a senior secured credit facility of $1.75 billion that was entered into by the company in January 2013.

Other mechanisms deployed as part of The Shift Plan (Alcatel-Lucent’s turnaround strategy) have included asset sales.

Last week the company announced it was in exclusive negotiations to sell its network-security business to Thales.

The Shift Plan also involves looking at fewer, high-growth markets, as well as €1 billion in cost savings in 2013-15, and asset sales of more than €1 billion over the same period.

As part of the plan, the company announced at the time financial targets including €2 billion in debt refinancing by 2015, followed by future debt reduction of €2 billion. The latter could include the issuing of new shares or further asset sales, it said.