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Nortel Selling up to Nokia Siemens
(22 Jun 2009, BWCS Staff)The once mighty Nortel Networks is to sell its CDMA and LTE businesses to Nokia Siemens Networks (NSN) for an estimated US$650 million, according to press reports. The Canadian vendor, which has been in bankruptcy protection since earlier this year, has begun selling off its assets and says it hopes that the sale to NSN will at least save some 2,500 jobs, mainly in the US and Canada, which will be transferred to NSN.
The Canadian government is said to be supporting the deal with a US$300 million loan. As Nortel is under Chapter 11 protection the sale is subject to the approval of the United States Bankruptcy Court and the Ontario Superior Court of Justice. Despite this, the deal is expected to be completed before the end of the next financial quarter.
At its zenith, the vendor was worth around US$250 billion, but it is expected to raise less than US$2 billion for its assets as it sells them off in bankruptcy court. Nortel has suffered over the past two years as its customers have chosen to save money, cut-back on network expenditure and delay upgrades. Last autumn, it tried to raise cash by selling its fast-growing, but unprofitable, Metro Ethernet unit, which provides network equipment for urban data rings, however, buyers failed to materialise.
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