7:50 AM -- In the latest installment of Nortel Networks Ltd. 's asset sale saga, four companies reportedly have been shortlisted as bidders for Nortel's controlling stake in LG-Ericsson Co. Ltd. , the joint venture with LG Electronics Inc. (London: LGLD; Korea: 6657.KS) .

According to this Reuters story, the South Korean daily news site eDaily reports that Alcatel-Lucent (NYSE: ALU), Sony Ericsson Mobile Communications , One Equity Partners , and Korean investment company SkyLake Incuvest are bidders for Nortel's 50 percent (plus one share) stake in LG-Nortel.

The LG-Nortel joint venture was not included in Nortel's bankruptcy filings in January this year, but the Canadian vendor is looking to sell this stake to raise cash. Nortel's stake in the venture could be worth $500 million, according to the Financial Times. (See Nortel Offers Up Its LG-Nortel Stake and Nortel Files for Bankruptcy Protection.)

Sony Ericsson has denied that it is pursuing Nortel's share in the joint venture.

LG-Nortel has been busy lately in the next-generation access technologies in mobile and fixed networks -- namely, Long Term Evolution (LTE) and WDM-PON. LG-Nortel recently won a WDM-PON deal in Norway. (See WDM-PON Update, LG-Nortel Wins Norway PON Deal, LG-Nortel Extends WDM-PON Distribution, and Who Makes What: GPON & WDM-PON Equipment.)

And in LTE, the joint venture recently staged the first data transmission handover between CDMA and LTE networks using LG's dualmode device, the M13, which is an important development for the U.S. market as Verizon Wireless pursues an aggressive LTE launch schedule for next year. (See LG, Nortel Do LTE/CDMA Handoff.)

— Michelle Donegan, European Editor, Unstrung