Lucent has again delayed the spinoff of its Agere microelectronic arm due to a revenue and profitability shortfall. The company remains committed to completing the spinoff of Agere, but says current market conditions introduce a degree of uncertainty about the timing.
In a statement Lucent said: Due to continuing market softness, Lucent will not be able to use the results from the second fiscal quarter to meet the EBITDA performance condition, as defined under the company’s credit facility, necessary to complete the spinoff of Agere. Lucent still remains fully committed to completing the spinoff as soon as possible and believes it is likely that it will be able to use the results from the third fiscal quarter to meet the condition.
Lucent intends to apply for a supplemental ruling from the Internal Revenue Service that the spinoff of Agere will be tax-free to Lucent and its shareholders despite the delay in the spinoff. The company is confident that it will obtain such a ruling.