Telecommunications equipment maker Lucent Technologies, which this year went on a buying spree of smaller networking equipment makers, plans to take a charge of $145 million related to two recent acquisitions, according to its 10-Q filing with the Securities and Exchange Commission.
Lucent plans to take a $80 million charge for in-process research and development related to its acquisition of SDX Business Systems, a maker of business communications systems. Lucent acquired the company on July 14 for about $200 million in cash.
Lucent also plans to take a one-time $65 million charge related to the $115 million purchase of LanNet, a maker of switching technology for networks.
The company plans to take a charge related to the $70 million acquisition of JNA Telecommunications Limited, an Australian telecom manufacturer. The intention to acquire JNA was announced in July and the deal is expected to be completed by the end of the quarter ending in September. The amount of the charge is yet to be determined, according to the SEC filing.
Beginning in October, Lucent will be allowed to participate in "pooling of interest" transactions, which is an accounting method that lowers costs. Because of the terms of its spin off from AT&T, this accounting method was not available to Lucent and the company focused on acquiring lower cost, smaller networking and telecom equipment makers like Yurie Systems, Optimqay GmbH, and Prominet Corporation.
Once Lucent can use "pooling of interest" to its advantage, it is expected to move toward buying larger networking companies and becoming a bigger competitor in the converging sectors of voice and data networks.
For months, analysts have speculated that Lucent would move to acquire Ascend Communications, a maker of communication products used by Internet service providers and telephone carriers. Ascend is valued at nearly $10 billion.