Canada's Nortel to sell itself off in pieces

Nortel became the first major technology company to seek bankruptcy protection in this global downturn.

Nortel Networks, once a technology giant, has decided to sell itself off in pieces rather than attempt to emerge from bankruptcy as a restructured company. Nokia Siemens Networks has agreed to buy some wireless operations of Canada's Nortel Networks Corp. in a $650 million deal as Nortel announced it is looking for buyers for the rest of its assets. The Finnish-German joint venture said Saturday it had agreed to buy the CDMA and LTE wireless technology assets of Nortel, a former telecommunications-equipment powerhouse that sought bankruptcy protection in January and now plans to liquidate its business. The deal is subject to court approval under an auction process in which other bidders could still make higher offers. Nokia Siemens is looking to strengthen its position in North American markets. Nortel, on the other hand, is winding down a company with a 127-year history in Canada and said it was in advanced talks to sell the rest of its operations. Nortel CEO Mike Zafirovski had hoped to restructure and preserve Nortel since seeking bankruptcy protection in Canada and the United States. "This is not the path which we worked so hard to get to," he said in an interview with The Associated Press. "We're in advanced discussions with anywhere from three to seven companies for each one of the assets." Zafirovski said the enterprise business, the optical Metro Internet business and the carrier voice-over IP and application business as well as part of the wireless business are among the assets still up for sale. Nortel also said it would ask to have its shares delisted from the Toronto Stock Exchange. Nortel employs more than 25,000 people around the world. During the 1990s telecom and Internet boom, Nortel had more than 95,000 employees. At one point in 2000 it accounted for one-third of the market value on the entire Toronto Stock Exchange. After the dot-com bust in the early part of this decade, Nortel had problems of its own: an accounting crisis that sparked shareholder lawsuits, regulatory investigations and the firing of key executives. Nortel became the first major technology company to seek bankruptcy protection in this global downturn. Nokia Siemens Networks is a joint venture of Finland's Nokia Corp., the world's top cellphone maker, and Germany's Siemens AG. It employs 60,000 people worldwide.