UPDATE 3-Alcatel-Lucent faces shareholder ire but gets votes
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PARIS, May 30 (Reuters) - Alcatel-Lucent (ALUA.PA) shareholders on Friday heaped criticism on top directors and backed a measure that would make it easier to oust them.
Some investors even called for the group's leadership to resign after having presided over a string of profit warnings, a dip into operating loss and a more than halving of its share price over the past 18 months.
Alcatel-Lucent, the world's largest provider fixed-line telecoms equipment, was created when Paris-based Alcatel acquired Lucent of the United States in 2006.
By February this year, the group's combined market value had shrunk by what was then some $20 billion and Alcatel-Lucent was forced to write down 2.94 billion euros ($4.55 billion) against the carrying value of assets acquired in the merger.
At the French-American group's second annual shareholders' meeting, investors approved a resolution that allowed the board to sack the chairman and chief executive with a simple majority as opposed to two-thirds of votes previously.
"I understand the despair of shareholders who have invested in our company," Chairman Serge Tchuruk told shareholders who had showed up en masse at the meeting held in the spacious meeting hall of the Palais des Congres in Paris.
"We are going through a new sectoral crisis. It is mainly visible in a strong fall in prices, which has almost offset the strong increase in volume," Tchuruk said.
Alcatel-Lucent said in April it expected stagnant telecoms equipment markets in 2008, matching predictions by rival Ericsson (ERICb.ST), after starting out the year by forecasting zero to slight growth.
ANGER
Shareholders called for Alcatel-Lucent executives to stop blaming the market for the group's woes.
"I have lost 100,000 euros by being a shareholder in Alcatel-Lucent...You just tell us it is difficult and yet you are asking for good marks -- I find that scandalous," said Mohammed Karim Lahjouji, 50, a private investor from Creteil, outside Paris.
"Do not think that we are stupid. This money was the fruit of my savings, my labour. You are getting money, you should merit your pay," he added.
Some shareholders criticised the remuneration Tchuruk received in recent years and called for him to leave the group, yelling, "resign, resign."
But they also backed the terms of a golden parachute for Alcatel-Lucent Chief Executive Patricia Russo that could be worth up to 6 million euros ($9.3 million).
In March 2008, the board granted Russo 800,000 options at an exercise price of 3.8 euros. The award, cited during the meeting, was booed by dozens of shareholders.
The group's share price, which hit a low of 3.2 euros in March this year, closed up 2.75 percent at 4.86 euros on Friday.
"I am shocked by this strike price of 3.8 euros."
Russo, who started the meeting by speaking a few words of French, showing she was delivering on a promise she would learn the language, said she understood concerns over the price drop.
"It is a real issue (the fall in share price.) The fact is that we are in an industry that is going through a number of changes that represents opportunities and a number of challenges," Russo said in English.
"We will make improvement in 2008 both financially and operationally," Russo said. (Editing by Quentin Bryar and Carol Bishopric)
