Alcatel-Lucent will sell €1 billion of assets and slash costs by another €1 billion in a bid by chief Michel Combes to turn the company around – something his predecessors tried, and failed, to do for seven years.

The shares jumped as much as 7.4 per cent after Mr Combes said that, by the time the plan is fully executed in 2015, the network-equipment vendor will have positive free cash flow and be more tightly focused on its most remunerative areas, such as ultra-high speed internet, after cutting out legacy operations.

Once restructured, Alcatel-Lucent, whose cash pile has now dwindled for seven consecutive years, will look to cut its debt by €2 billion by selling shares on the stock market or through further asset sales, Mr Combes said. – (Bloomberg)