What was once a world-leading technology developer now looks like it's being carved into chunks and sold to its competitors for a pittance. Nortel, which at one point employed nearly 200,000 staff and was valued at US$250 billion, is likely to see Nokia Siemens Network (NSN) purchase key parts of the bankrupt firm for an undisclosed amount, rumoured to be at the very bottom of market expectations at between US$500 million and US$1 billion.
NSN apparently made an unsolicited bid last month for Nortel's profitable carrier networks unit and an R&D unit working on LTE technology. It wants to use the acquisition to leapfrog its way into the North American market where Nortel has a strong customer base. If successful, NSN would see its share of this market jump to over 30 per cent, up from 7 per cent today.
While three other groups including Genband, Avaya and Golden Gate Capital also have floated bids for pieces of Nortel, there is speculation Alcatel-Lucent might not want NSN to dramatically increase its US market presence and could enter a bid for business elements of Nortel.
Nokia Siemens eyes Nortel breakup -- wireless unit tops list
Nortel confirms it may sell businesses
Nortel watches as Ericsson capitalizes on CDMA-to-LTE conversion
Nortel deal speculation heats up