Alcatel-Lucent is talking to Goldman Sachs about a loan, the latest tactic used by the struggling equipment vendor to attract fresh finance, according to Bloomberg sources.
Some of the vendor’s assets would serve as collateral under the terms of the deal. The size of the loan has not been disclosed.
The vendor is also mulling over some other means to raise new cash. Last week, the vendor’s CFO, Paul Tufano, said it is considering the sale of some secondary patents.
In addition, there has been speculation that Alcatel-Lucent might sell whole business units, such as its submarine cable business and enterprise unit. But both potential sales are at an early stage and might raise less than EUR1 billion. Debt-for-equity swaps might be another tactic.
The company is under pressure in the wake of disappointing financial results.
Alcatel-Lucent has become one of the leading targets for short-selling by investors, according to a report by Markit. More than 15 percent of the vendor’s shares are being loaned by investors, it says.
Short sellers are effectively taking a bet they will be able to buy back the vendor's shares at a lower price, reflecting pessimism about its prospects among a significant number of investors.