As the Canadian government is dragged reluctantly into the increasingly involved bidding process for the remains of Nortel, analysts are suggesting that those having revealed their hands--Nokia Siemens Networks (NSN), MatlinPatterson and RIM––could now be joined by others.
The emergence of RIM has surprised many and has triggered rumours that Apple might now enter the fray--albeit farfetched until RIM's sudden interest––while Huawei is now increasingly viewed as a possible suitor, leaving Ericsson and Alcatel-Lucent as little more than interested watchers--for the present, that is.
What seems certain is that NSN will now have to raise its US$650 million bid following MatlinPatterson's counter offer of US$725 million, and bundled with a clutch of former Nortel executives including former North American president Dion Joannou, Richard Piasentin, former Nortel VP of sales and Tony Pirih, former head of Nortel R&D. The team also includes former executives of AT&T Wireless, Alltel and Motorola.
While NSN is expected to respond, the US$1.1 billion offer from RIM has provoked wider attention. Duncan Stewart, an analyst at DSAM Consulting in Toronto, said: "This has abruptly catalysed the Nortel auction. Somebody who is big and smart has just said, 'We think there is value here,' and at a level roughly double the NSN bid."
The unexpected appearance of a handset vendor bidding for infrastructure assets is due to Nortel's LTE expertise. While 3G handset antenna technology is almost identical between vendors, RIM's interest is said to be focused on gaining an early market advantage in LTE antenna design." All of a sudden, antenna technology in next generation networks may in fact become an important differentiator," commented Stewart.
However, Nortel has blocked RIM's bid, which has stirred Canadian politicians into urging Nortel to meet with RIM (both Canadian firms) to find a resolution. Nortel attempted to clarify rejecting RIM's offer for its CDMA/LTE and ‘certain other assets' due to RIM's refusal to comply with the bankruptcy court approved procedures--which seemed to revolve around confidentiality terms relating to Nortel's intellectual property assets.
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