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Optical/IP

Nortel Postpones Optical Auction

12:30 PM -- In the hope of attracting more bidders, Nortel Networks Ltd. has, as expected, postponed the auction of its Metro Ethernet Networks (MEN) division, leaving Ciena Corp. (NYSE: CIEN) sitting on its hands and its $521 million opening bid. (See Nortel MEN Auction Delayed? and ITU: Ciena Bids $521M for Nortel's MEN.)

The auction had been due to take place today, Friday 13th, but Nortel announced around midday that "in light of ongoing discussions with interested parties," it decided not to bother. (See Nortel's MEN Auction Set for Nov. 13.)

In other words, it's been delayed due to lack of interest. And the last thing Nortel wants is an auction with only one participant: If Ciena walks away with MEN for $521 million, many would regard that as something of a bargain. Most valuations put a fair price of $800 million to $1 billion on the MEN division.

Nortel says "qualified bidders are now required to submit offers by November 17, 2009," and that it "expects to provide a further update on the auction process and sale" of its global optical networking and Carrier Ethernet businesses "next week."

Maybe Nokia Networks hasn't completed its paperwork... (See Nokia Siemens: Hot for Nortel's MEN?)

Nortel is also due to announce its third-quarter sales next week, probably Monday 16, which will provide the whole industry with a guide as to how well, or badly, the MEN division is performing.

— Ray Le Maistre, International News Editor, Light Reading

HomerJ 12/5/2012 | 3:52:36 PM
re: Nortel Postpones Optical Auction word is they had too many people lining up to bid
somedumbPM 12/5/2012 | 3:52:35 PM
re: Nortel Postpones Optical Auction Oooo.... words are coming out. Any words on who was standing in the line?
Stevery 12/5/2012 | 3:52:33 PM
re: Nortel Postpones Optical Auction

Most valuations put a fair price of $800 million to $1 billion on the MEN division.


LOL.  I would be quite embarassed if I published a valuation of $1B and the final sale comes in at half that:  It tells you that the valuation was either from a party with a vested interested (while pretending not to have a vested interest) or from a dolt.


So which is it: dishonest or stupid?


jggveth 12/5/2012 | 3:52:31 PM
re: Nortel Postpones Optical Auction My good Mr Stevery,

Let's make a bet. If the final price is $800 million or higher you agree not to post on this site for 1 year. If the price is lower I will not post. Do we have a deal?
inauniversefarfaraway 12/5/2012 | 3:52:30 PM
re: Nortel Postpones Optical Auction

Stevery,


If it's Nortel, it has to be both! The genius of the "and" once again overcomes the tyranny of the "or".

Stevery 12/5/2012 | 3:52:28 PM
re: Nortel Postpones Optical Auction

 

<div>My good Mr Stevery, Let's make a bet. If the final price is $800 million or higher you agree not to post on this site for 1 year. If the price is lower I will not post. Do we have a deal? </div>
<div>
</div>
<div>Sure, as long as you give me the dumbass factor of 2 that the "analysts" need.&nbsp; So if its lower than $420M, I'll go away and if it's higher you'll go away.</div>
<div>
</div>
<div>But here's a more interesting question:&nbsp; How much do you need to pay someone to take 3x sales or 15x profit and apply the latest-and-greatest fashion in fudge factor?&nbsp; If a factor of two is acceptable, what clown is going to pay the IB fees to be told that the valuation is 7.5-30x profit?</div>
<div>
</div>
<div>@inauniversefarfaraway:&nbsp; Thank you for freeing me from the tyranny of "or".
</div>
Litewave 12/5/2012 | 3:52:25 PM
re: Nortel Postpones Optical Auction

One could almost&nbsp;visualise&nbsp; Monday's headlines can't they...


"NSN pulls an Ericsson on Ciena".

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