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Nortel: What's Left on the Shelf?

Ray Le Maistre
11/25/2009

Nortel Networks Ltd. 's fire sale has picked up pace in the past few days, with the agreed-upon sales of the Metro Ethernet Networks (MEN) division and GSM business. (See Ericsson Buys Nortel's GSM Biz Too and Nortel's MEN: Winners & Losers.)

Those deals take the total Nortel has raised from its asset sale program to $2.93 billion, mostly in cash.

So what's left for the bankrupt Canadian vendor to sell? Here's an update on what's been sold, and what's still up for grabs.

SOLD – Concluded and agreed asset sales
In reverse chronological order:

  • GSM business -– November 2009 -- Ericsson AB (Nasdaq: ERIC) picks up the North American business for $70 million, while Austria's Kapsch CarrierCom AG is paying $33 million for the EMEA (Europe, Middle East, and Africa) and Taiwan GSM operations, and the GSM-R (specific development for on-train mobile communications) business.

  • Metro Ethernet Networks (MEN) -- November 2009 -- Ciena Corp. (NYSE: CIEN) beat out Nokia Networks to land Nortel's optical and Carrier Ethernet assets in a deal valued at $769 million. (See Ciena Beats NSN to Buy Nortel's MEN and Gary Smith, CEO, Ci-MEN-a.)

  • Mobile evolved packet core (EPC) -- October 2009 -- Hitachi Ltd. (NYSE: HIT; Paris: PHA) slipped Nortel $10 million for its LTE packet core assets. (See Hitachi Takes Nortel's LTE Packet Core.)

  • Enterprise -- September 2009 -- Avaya Inc. bolsters its business with the $900 million acquisition of Nortel's unified communications and enterprise voice and data assets. (See Avaya's $900M Bid Wins Nortel Auction.)

  • CDMA and LTE access -- July 2009 -– Ericsson outmuscles Nokia Siemens to land Nortel's prize wireless assets for a cool $1.13 billion. (See Nortel Wireless Winner: It's Ericsson!, Ericsson Delivers Knockout Blow to NSN, Ericsson: Why We Want Nortel's Wireless, and Interview: Ericsson's CDMA Chief.)

  • Layer 4-7 Application Delivery Business -- February 2009 -- Radware Ltd. (Nasdaq: RDWR) picked up Nortel's application switching and WAN optimization assets for $18 million, and has already relaunched the product line. (See Nortel to Offload Data Gear to Radware, Radware Completes Nortel Buy, and Radware's New Superhero.) NOT SOLD – Assets still for sale (or not even for sale)
    The bulk of Nortel's business has been offloaded, but there are still some units left, including one that's still growing. Then there are the assets that Nortel might just hang on to...

  • Carrier VoIP and Application Solutions -- The shining light in Nortel's recent third quarter, it was the only business line to see a year-on-year increase in revenues. There's been a lot of talk and speculation about potential bidders, but no firm action as yet. (See Nortel Shrinks Again, Handicapping the Nortel VoIP Triple Crown, Report: Stalking Horse Stampedes Toward Nortel's VoIP Biz , and Who's Dialing In for Nortel's VoIP Assets? )

  • Legacy mobile packet core -- The next-generation evolved packet core assets may have been sold, but Nortel still has its existing mobile data management platforms to sell. The company had hoped to offload all its mobile packet core assets together. (See Nortel's Next Auction: The Packet Core.)

  • LG-Nortel majority stake -- Nortel's 50-percent-plus-one-share stake in Korean joint venture LG-Ericsson Co. Ltd. has been on the table since May. But no offers have been forthcoming and the business is in meltdown, with revenues down 51 percent year-on-year to $103 million in the third quarter. (See Nortel Offers Up Its LG-Nortel Stake.)

  • Intellectual property -– Nortel has been offloading technology that's already developed and bundling in patent licenses as part of the sale packages, but has been holding on to its intellectual property. There's a chance Nortel might continue to exist as a shell company managing that valuable intellectual property. (See Nortel Could Sell LTE Patents Separately, RIM CEO Calls Nortel LTE Patents a 'National Treasure', and Nortel's LTE Patent Goldmine.)

    — Ray Le Maistre, International News Editor, Light Reading

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