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Lucent to Spin Off Three Businesses
MURRAY HILL, N.J. — Lucent Technologies Inc. on Wednesday said it would spin off three slower-growing businesses, forming an $8 billion independent company, as it moves to focus on its fastest-growing operations following a recent earnings letdown.

Lucent, the world's largest maker of telecommunications equipment, said the spin-off would include its company switchboard, or PBX, operations; Systimax, which makes cabling systems for corporate campuses; and its local-area network, or LAN-based, data business.

The new company, to be named later, will start out with $8 billion in annual revenues and a client list chock full of the largest U.S. companies, Lucent said.

Lucent named its chief financial officer, Don Peterson, as chief executive officer of the new company, and its former chairman and current board member, Henry Schacht, as chairman of the spin-off.

"By spinning off our PBX, Systimax cabling and LAN-based data businesses, we are sharpening Lucent's focus and creating another leading company to serve business customers," Lucent Chairman and Chief Executive Richard McGinn said.

A spin-off or divestiture of the slower-growing operations had been expected; Lucent has been under pressure to return to high growth after stumbling in the first quarter with a lower profit and flat revenues.

The new company, with 34,000 employees worldwide, is expected to record a one-time charge for restructuring purposes, Lucent said. More details on the charge and restructuring were not immediately available.

Shares of Lucent, the most widely held U.S. stock, closed Tuesday at 59-1/2 on the New York Stock Exchange, but in pre-open trading on Wednesday they were up 5-1/4 at 64-3/4.

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