Alcatel, Lucent May Join Forces

France’s Alcatel, the world’s biggest maker of broadband Internet equipment, and smaller rival Lucent Technologies Inc. said Thursday that they were in advanced talks to create a $33-billion merger of equals.

An agreement would solidify Alcatel Chief Executive Serge Tchuruk’s 10-year effort to turn around the company. Tchuruk is winning orders from companies including AT&T; Inc. to build networks that carry Internet, phone calls and television.

“We can confirm that Lucent and Alcatel are engaged in discussion about a merger of equals that is intended to be priced at market,” the two companies said in a joint statement.

Lucent, whose stock dropped 29% last year, is facing mounting concerns that the company is losing out in the growing market for Internet-based communications equipment. Sales unexpectedly fell last quarter, and in January Lucent said demand was slumping in the U.S. and China.

“There can be no assurances that any agreement will be reached or that a transaction will be consummated. We will have no further comment until an agreement is reached or the discussions are terminated,” the companies said.

Lucent, after spinning off from AT&T; in 1996, became among the highest fliers in the bull market. Its shares soared more than sevenfold from the end of 1996 to a high of $63.22 in December 1999. They have since lost 95% of their value.

Shares of Lucent were unchanged Thursday at $2.82. Paris-based Alcatel rose 10 cents to $15.45. Word of a possible merger came after markets had closed.

The announcement comes two days after Murray Hill, N.J.-based Lucent won an auction to buy Riverstone Networks Inc., a maker of network routers.