STOCKS TO WATCH: Alcatel, Avant, Qwest
Expect the following technology stocks to be among Monday's most actively traded issues: Alcatel, Avant! and Qwest.
The French network-equipment maker will be on the move Monday on reports that it not only has offered between $5 billion and $6 billion to purchase Lucent Technologies' (NYSE: LU) optical fiber business but might be interested in merging with its U.S. competitor.
Industry sources told the Wall Street Journal that parties had been in talks that could lead to a merger of equals, with the initiative taken by Alcatel which wants to break into the carrier market.
The sources said the talks did not progress to an advanced stage because of differences on valuation and the fact that Lucent was apprehensive about getting easy merger clearance from authorities in Washington.
Alcatel shares closed up $1.11 to $30.96 Friday while Lucent inched up 12 cents to $10.80.
Executives at both companies declined to comment on the reports.
Avant! shares will be active Monday after it posted better-than-expected earnings in its first quarter.
In the quarter, Avant! earned $18.4 million, or 48 cents a share, on sales of $94 million.
The $94 million in sales represents a 10 percent improvement from the year-ago quarter when it pocketed $16.5 million, or 41 cents a share, on sales of $85 million.
The stock closed up 11 cents to $20.16 ahead of the earnings report.
Qwest should be worth watching Monday after announcing that it will pay $350,000 to settle state officials' complaints that it misled about 58,000 Pennsylvania consumers by engaging in "slamming" practices and a promotion that appeared to offer airline tickets to those who switched their long distance telephone service.
The Denver-based telecommunications company, which did not admit any wrongdoing, reached the agreement with the Pennsylvania attorney general's office in March.
The attorney general's office said Friday that Qwest changed consumers' telephone services without obtaining proper written permission, otherwise known as slamming.
State officials said that a telemarketer for the company also recruited customers by offering two "free" airline tickets as an incentive for switching long-distance service to Qwest.
However, consumers sometimes were not told that they had to buy accommodations at rates ranging from $154 to $427 a day in order to use the tickets, state officials alleged in an agreement signed by them and representatives of the company.
Under the agreement with the state attorney general, Qwest must refund eligible customers and pay $350,000 to the state for investigation costs and other expenses.
Qwest shares finished up 55 cents to $39.80 Friday.
Reuters contributed to this report.>