Two days left for debt laden Lucent

Morgan Chase and Citigroup are expected to commit $1.25bn each, but the company is still waiting to hear from a number of other lenders. It needs to raise the full amount by Thursday.

Lucent refused to comment on the current situation but admitted it had lost its way over recent months.

A spokeswoman for Lucent said: "The past 12 months have indeed been tough for Lucent. We got off track and tried to form the company faster than it was able to. We were not able to keep up with explosive business and market demands."

She said the company has become driven by Wall Street expectations and execution of the operations broke down under the pressure of driving to deliver quarterly revenue growth.

However, analysts claimed Lucent had over-stretched its resources in a market in which it had little previous experience or success - namely next generation wireless technology.

Mat Hanrahan, analyst at Bloor Research, claimed Lucent's vendor financing plan, which offers special rates and deals to its customers, is the key to its problems.

He said: "This is where it has all gone wrong. Lucent has extended itself to get a foothold in 3G, and it had to do that, but UMTS is a whole new building. Lucent tried to make itself attractive and offer better, more friendly rates but it is telling the licence holders they can pay back on the never-never."

Tim Gower, analyst at Datamonitor, pointed out that Lucent is a relative newcomer to 3G and as such is not the strongest contender.

He said: "Lucent might have done this to prove its expertise by getting networks up and running. There are a lot of rich pickings in the UMTS contracts up for grabs."

The company is struggling against Nortel in its optical business as well as seeking to reduce debt through an IPO of its chip division, Agere Systems.

Lucent said it is confident it will find the financing needed to meet its slef-imposed Thursday deadline. However, if the company fails to meet that deadline, its share price is likely to take a further hammering - its credit rating is currently just one level above junk. It will also increase the need for the Agere floatation to be a major success.