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Alcatel to Invest in 360networks

November 01, 2000|Bloomberg News

Alcatel will invest as much as $1 billion in 360networks Inc. and be the main supplier for an underwater fiber-optic cable that 360networks is building to link North America and Japan. The agreement gives 360networks cash that it might have had trouble raising in the capital markets, as a proliferation of data networks leaves some investors worrying that a glut in fiber-optic capacity is on the horizon. 360networks, run by former Microsoft Corp. Chief Financial Officer Greg Maffei, will buy as much as $1.1 billion in equipment from Alcatel, Europe's No. 2 phone equipment maker. Meanwhile, Alcatel said its operating profit more than doubled to $520 million in the third quarter, as sales rose 50% to $6.6 billion. Alcatel raised its sales growth forecast for the year to the "high 30s," up from the 35% previously expected. Alcatel closed at $62.38, up $5.25 on the New York Stock Exchange. 360networks rose $2.38 to close at $18.13 in Nasdaq trading.

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