Alcatel-Lucent S.A. (NYSE: ALU) has been deemed a dud of a buyout by many investors. The consensus vote from the equity markets is that the buyout offer from Nokia Corp. (NYSE: NOK) just does not compensate long-term and short-term investors enough. Several other things are at work here, not all of which are unilaterally good, and some investors may be hoping that a sweeter offer may need to be made.

This past week brought news that there may be at least one more strong fighter in its corner for a higher merger price. It was reported that Elliott has taken a 1.3% stake in Alcatel-Lucent shares. What was hard to imagine was that there was little interest paid by the market here — both stocks were lower on Thursday than versus last Friday. Elliott has a long history of knowing how to help companies turn five dimes into six.

The potential activist stake news was on the heels of Alcatel-Lucent’s second largest shareholder having voiced in recent weeks that the merger price offered by Nokia was just too low. Again, the trading history supports the belief by investors that the deal itself is a dud or that the terms are a dud.

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Also from recent days, Wells Fargo issued a research report on Nokia, noting that the Elliot stake may bring a possible snag in the pending Alcatel-Lucent acquisition. Maynard Um has a Market Perform rating and he said:

The Financial Times reported that activist investor Elliot Management has purchased equity swaps in Alcatel-Lucent equivalent to a 1.3% stake ahead of the Nokia and Alcatel-Lucent acquisition. While Elliot has not commented on its intentions regarding it stake, we do not rule out potential activism to increase the offer price. The deal requires only a 50% tender by Alcatel-Lucent shareholders as well as approval by Nokia shareholders, which has yet to be scheduled. This follows Alcatel-Lucent’s second largest shareholder (with roughly a 5.5% stake) previously arguing that Nokia’s offer was too low…

Wells Fargo gave a Nokia valuation range of $6.75 to $7.25 per share based on a sum of the parts with a Networks multiple of roughly 1.2 times, HERE at 2.6 times and Advanced Technologies at 4.4 times plus dividends.

Now 24/7 Wall St. wants to consider what all of this means on a grander scale in American depositary share (ADS) terms.

Nokia shares were down 1.6% at $6.73 in late Thursday trading. That is performing very poorly in the past two weeks, and it is not really anything that can be blamed on Greek uncertainty.

Alcatel-Lucent’s ADSs in New York trading were down 0.8% at $3.59 late on Thursday. This is down over $1.00 from the post-merger announcement pop, and would be the lowest reading since the first week of May.

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If Elliott is going to make some magic happen here, or if other shareholders are going to try, they might need to consider how to get that out there soon.

Regulators are likely to keep agreeing to this Nokia and Alcatel-Lucent merger. After all, it is not as if either company is taking over the world. Still, many shareholders are just highly unimpressed.

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