PARIS -- Alcatel (Paris: CGEP.PA and NYSE: ALA) is initiating today the sale of 10,300,000 Thales shares, i.e. 6.1% of the share capital of Thales, based on the modification of an agreement signed in 1998 between Alcatel and Groupe Industriel Marcel Dassault (GIMD).Neither the agreement between the Public Sector (« Secteur Public ») and the Industrial Partner (« Partenaire Industriel ») (Alcatel and GIMD), nor the other terms of the agreement between Alcatel and GIMD will be affected by this transaction. Alcatel confirms its position as the number one private shareholder of Thales, with three seats on Thales’ board of directors. Alcatel intends to continue the joint activities between the two groups. Upon the closing of the transaction, Alcatel’s shareholding in Thales will amount to 9.7% and the Industrial Partner will hold 15.56%.Independent from this transaction, Alcatel reiterates that the group can finance its operations in 2003 and beyond. As for today’s transaction, it contributes to further strengthen its balance sheet ratios and its financial situation, as well as financing restructuring costs as mentioned earlier this month.Alcatel SA