Lightreading is reporting that telecom equipment company Nortel (NT) may be close to buying Tellabs (TLAB). NT may have already made an offer of $14 to $15. According to Lightreading, "Tellabs is seen as a solid technical fit for Nortel, according to sources close to both companies,"
While it may appear like a good fit, the price would be too hight. TLAB has a market cap of $4.5 billion. The price NT would pay probably moves that up to $6 billion. And, that is to buy a company which did $534 million last quarter with an operating profit of $28 million. So, the price would be almost three times annual revenue.
Nortel trades at about 70% of its annual revenue base of $11.5 billion.
Tellabs would get almost 45% of the company for bringing in 20% of the revenue.
Douglas A. McIntyre
Want to Retire Early? Start Here (Sponsor)
Want retirement to come a few years earlier than you’d planned? Or are you ready to retire now, but want an extra set of eyes on your finances?
Now you can speak with up to 3 financial experts in your area for FREE. By simply clicking here you can begin to match with financial professionals who can help you build your plan to retire early. And the best part? The first conversation with them is free.
Click here to match with up to 3 financial pros who would be excited to help you make financial decisions.
Have questions about retirement or personal finance? Email us at [email protected]!
By emailing your questions to 24/7 Wall St., you agree to have them published anonymously on a673b.bigscoots-temp.com.
By submitting your story, you understand and agree that we may use your story, or versions of it, in all media and platforms, including via third parties.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
