Toronto, July 27 (Inditop.com) Courts in the US and Canada are likely to approve Tuesday the sale of global telecom firm Nortel’s wireless business to Sweden’s Ericsson last week.
The Swedish telecom major has purchased Toronto-based Nortel’s wireless business for $1.3 billion at a court-supervised bid in New York Friday. Ericsson will also retain one third or 2,500 Nortel employees.
The sale of bankrupt Nortel’s CDMA and Long Term Evolution (LTE) puts its next-generation wireless technology in the hands of the Swedish company, which is seeking expansion of operations in North America.
The bid awaits court approval in the US and Canada where Nortel has been operating under bankruptcy protection since January. In its first post-auction statement here, Nortel said that “as part of this agreement, a minimum of 2,500 Nortel employees supporting the CDMA and LTE Access business will receive offers of employment from Ericsson”.
Nortel president and CEO Mike Zafirovski said: “The anticipated sale of our CDMA business and LTE Access assets to Ericsson for $1.13 billion represents a very positive prospect for our customers who will be able to continue their relationships with a long term partner, (and) for employees who will have new opportunities at Ericsson and for many of our other stakeholders.”
He said: “Nortel remains focussed on finding the right buyers for our other businesses while continuing to maintain excellent customer service levels.”
Before Nortel totally dismantles itself with the sale of other businesses to meet its credit liabilities, he said, it “will leave its mark on the industry for decades to come”.
The CEO said Nortel will seek Canadian and US court approvals of the sale agreement at a joint hearing Tuesday.
The 127-year-old Canadian telecom equipment giant has been operating under bankruptcy protection since January after suffering losses of $5 billion last year.
The further losses of $507 million in the first quarter of this year sank the Canadian corporate icon.
Nortel’s other divisions — the enterprise unit and the metro Ethernet networks unit — are also up for sale.
