Alcatel, Lucent Stockholders Set To Vote On Merger

Several investment banking analysts have complained about the merger, but according to RBC Capital Markets, the institutional shareholders who own about 85 percent of Alcatel stock are likely to favor the merger.

"The combination between Alcatel and Lucent makes sense," said Mark Sue in a research report as quoted by Forbes.com. "Of the institutional investors, the vast majority are considered long-term holders So as unhappy as some shareholders may be, these smaller accounts may not have the ability to block the deal."

A major sweetener to the deal is the prediction that a merged Alcatel-Lucent would result in about $1.7 billion in savings. The deal also represents a larger trend in which telecommunications equipment manufacturers have been consolidating as service providers make more demands on them. In recent months, Nokia and Siemens have teamed up and Ericsson and Marconi have combined, for instance.

In recent days, Lucent settled stockholder litigation that had been filed protesting the merger and the price drop in Lucent stock.