Nortel Gets Slammed for Nokia Deal

Nortel Wins Approval of Nokia-Led Auction of Unit ... latest update from Bloomberg. This is significant since it removes the hurdles that the matlinpatterson and other creditor groups were trying to place.

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aqNy54y8uPsE

>>MatlinPatterson, a major bondholder and Nortel creditor, is one of the objectors to the sale of Nortel CDMA/LTE assets to NSN.

In case you are wondering who is this firm, how do they usually operate and their past history, here is an interesting old article on MatlinPatterson. The Forbes article seesm to imply that MatlinPatterson are purely Vulture like investors in distressed assets, and thats their main game.

http://www.forbes.com/forbes/2002/0930/400337.html

Another interesting article on Vulture funds:

http://www.adbusters.org/magazine/76/vulture_funds.html

Is anything important for the discussions on AAN?
For some unknown reason all the discussions are side tracked and pushed away into nothingness.
Example
Shareholders issue.
Who would care about shareholders, right?
Oh, maybe just other shareholders should care about shareholders?
Next were pensioners.
Who would talk about their Pension Deficit?
There was no reliable info about the deficit in media.
We were smart to figure out the deficit loong before analysts.
Even today $3 bill we estimated was too much for the derail posters like ToungeInCheek.
another
Who would care about creditors and suppliers? They should know better who they give money to.
Oh, yes... employees... they post 75% or more posts here.
It was so cozy and nice until Nortel kicked their double face a$$es.

Let's go back to the creditors and try to find out what's important in their objection to the deal?
Why they say it's not fair game Nortel=Bod=Mike Z is playing with them?
"MatlinPatterson is not prepared to give up on its investment in Nortel or in the potential in the company,"
We don't need another derail of the discussion by that well known_exposed many times TiC!
Who is he?
Is he one of BoDirectors?
It's not funny when millions of investors were fooled by him and his supporters.
It's not funny when pensioners are worried about future.
It's not funny when creditors are robbed.
It's not funny for the public to watch that horror and there is no answer to any question of the type why, who, where, how…?
Do we need TiC and the gag orders?
How many times he said he will sue AAN and the posters who were critical in assessing public info?

Here is what will happen.
Bonuses will continue to be some kind of "thank you for sticking with us" incentive and there will be AIP payouts until Nortel is completely obliterated.
Whether the new buyer takes you will depend on four things. Salary, Experience (resume), Age, How good you look.
No deal is a done deal till the stalking horse has crippled itself at the finish line. The government officials, and fellow toastmaster goof friends who ALL lost way too much money blindly trusting in Nortel had their ego and pride hurt so when Z came calling to the policitians, they sent him packing.
Thank John, Frank and Admiral Crispy Creme. Mike just gave it the coup de grace.
Nortel is Canadian.
The canadian government is only interested in taking care of people from other countries, people coming in from other countries and foreign companies like G.M. America. Don't let the GM Canada thing fool ya.
Time to crank the zeppelling.."In the evening"..Great time.
Pope the coolers and hit the bong.
Cheers.

Hey ****suckers.

Is Nortel the CF105.II.gc.ca destined to look like http://www.maverick2.com/arrowlinks.htm in the not so distant future. Why isn't anybody up in arms when only gc.ca found Z's restructuring plans unworthy of even a chance?

Comments on point above only: danleonida@yahoo.com

The Nortel folks that take care of Latin America from Sunrise, Florida should be aware that NSN has a very conveniently located office in nearby Boca Raton. The concern, of course, is how many people in NT have a counterpart in NSN. At that point, NSN will have a choice to make.

One thing is for sure, I doubt NSN will agree to maintaining the same pay scale for transferred NT staff.

Good luck Nortelers. Comments to the above appreciated.

Actually over the years I have found that Nokia at least pays better for the equivalent role than Nortel ever did.

Sunrise/CALA started as a remote sales office managed from Canada. It stayed that way for a very long time and suffered since they couldn't really function well without support from Nortel's Canadian base wireline interests. Further hampering was caused by the fact the Latin American country managers had no control over their budgets...all of which were Sunrise/Canadian controlled.

"Deal or No Deal"?

In my opinion and the opinion of most others knowledgeable in the wireless industry, a wireless infrastructure going concern coming out of this situation with a future beyond a couple of years needs LTE to offset the gradual decline in CDMA sales. Of course, no major wireless operator would enter into a long term arrangement on LTE with a company in Ch 11. Therefore CDMA + LTE must be sold, and as a consequence the remaining wireless assets sold. Wireless operators, particularly tier 1 players, need to partner with strong and viable wireless network companies with global reach that are major players in the evolution of technology, standards, and the wireless ecosystem. This is not a game that any random collection of entrepreneurs and financiers can play in and win.

The terminated employees and pensioners take another hit. The Ontario bankruptcy court has denied a motion to allow severance or unregistered pension TRA/RAP payments to be made at this time. They will have to wait in line with the other unsecured creditors.

The Judge may allow some relief though. He has ordered the monitor to come back within 30 dyas with a list of terminated employees or pensioners who may be experiencing hardships to allow a partial pay out of moneys owed.

Also Nelligan O'Brian Payne have requested a motion to appeal the order against them providing representation status for the NCCE (Nortel Continuing Employees Committee) to the appeals court of Ontario.

They claim that the judge left the NCCE without representation in the CCAA proceedings without any reason.

The only relief the judge will allow is what he releases in his pants.
This is just another excuse to get more lawyers, and pay them more money. There's no pot of gold at the end of the rainbow boys and girls. Just a cauldron of s**t.

There was a June 17th supplement to the ruling (see the E&Y site) that indicated continuing employees are represented by Koskie Minsky.

Nortel has a way of downplaying, contradicting, and fixing the bet, whether its setting specs for BSNL tender requiring a decade of international experience, voting their pay practices or trading options to cash again or keeping fraud bonuses at a kangaroo AGM, to selling assets favoring one bidder over another, etc...

They should make front page if they didn't do anything underhanded but honest instead.

=)

Nobody takes this company seriously any more.

I didn't think anyone took them seriously after about 2002. Nortel will make a great case study when its all said and done. The place is littered with mistakes that can be learned from for generations to come.

Poisenedivy, I understand your frustration that you are still at risk for layoffs, but you were inaccurate in your assumptions in this case. KS has been incorportated into all of the units, not just CDMA/LTE. This way each unit can be presented as a whole, with all its functioning parts. This is not unique to your unit.

And, of course, it is NSN that has determined that that they want as a part of their purchase. If they want KS, they have the option to get designated CDMA KS people. If they don't want KS, they could just not hire them. This would actually improve your odds, based on the 80% idea.
Slow down, and take a breath.

But, 80 percent of more people does mean more people are layed off, but it also means more people aren't. Your chances still remain 8 out of 10...
or am I misunderstanding you point here?

I think what Poisendivy is saying is that people that are not currently in CDMA and/or LTE are being moved into these groups in order to preserve their jobs hence putting the personnel already in those groups at risk. If that's the case, this seems very unethical. My hope is that NSN already has the list of names (of the actual CDMA/LTE employees) and are drafting up their offer letters in preparation of winning the bid.

I'm in neither CDMA nor LTE but I wish all of the people that have been actually doing the work in these groups success in being transitioned. I also hope that any unethical moving of personnel into "safe places" backfires.

We've seen similar activities in our group for some time now. It appears to be a "good ole boys club" sort of thing.

that was exactly what i was trying to say. there were 2 sr managers out of nowhere that came in for example. what do we need with so much additional overhead. the fear is there is some serious buddy network garbage going on and that these new people will be preserved through politics and manuevering and people that have stuck through all of this will now find themselves in the 20% that is let go. this 'trading up' mentality is sickening. our director(s) should have been 'traded up' a long time ago.

I seriously doubt that NSN has any list of CDMA/LTE employees. If they did, and checked it, they would find much of the real talent now works for Huawei, RIM, Lucent or Intel.

Good points, but if they have set up all units to include product designated KS, how could this be considered "good ol' boy" stuff?
Seems like the units are being defined to offer potential buyers all the support needed for the products they will be producing.
Again, NSN could opt out of retaining KS and out source. KS still remains the most vulnerable group for layoffs.
Maybe you're not to fond of KS?

Oh no, I'm very fond of KS and am pleased that they are being aligned with their respective products. I overlooked that comment (somehow?) and assumed that Poisenedivy was referring to people being moved to/from other product lines which is something that that has been occurring a lot lately. I also assumed that CDMA and LTE KS personnel were already included in the original 80% proposal. My mistake. My BIG mistake!

Whoops, and I was not meaning you in reference to KS...
:)

i'm one of the futunite that will be part of the NSN purchase but i'm seeing some very disturbing things lately. our director mark slater and our VP noy have been letting some of us know lately that 80% of our CDMA/LTE will be going to NSN, not the 2500. what is disturbing about this is that apparently he has been extending life preservers to all of his buddies in other organizations like KS and we are growing like a puff fish. it has got my staff absolutely spooked as we are all afraid we will expand enough to create a new bottom 20% to be released b4 the purchase leaving many of us high and dry, not unlike many of the talented people that were let go shortly after the jan 14 date. it is great that our personal nightmare may soon be over but not so great that we may get to be part of the 20% and the 80 / 20 rule is rearing its head again.

to add to asitgoes comment above...

1. I don't think anybody will say for sure at this point that a person in CDMA/LTE access is "in" or "out" of the NSN deal of approx. 2,500 employees. I'm sure a few people have a very good idea of who would go across (assuming NSN wins the auction of course) - these people would be at director/VP level since they are the ones involved in the negotiation process with NSN.

2. Suppose one of the dir/VPs comes to you and say "you're name is on the list", and then when NSN goes to make offers, they decide to make an offer to someone else instead. You're pissed right? Bad move for all. IMHO, I don't think there is a list of names, just functions with headcount against them. In the end, it would be up to NSN to whom they extend offers.

3. The 2,500 is 80% of CDMA/LTE access (which means about 3,100 total population). What I have head through GISs, is that this represents people who are supporting North American customers (ex. Verizon, Sprint), since NSN wants to get into the NA market. So, if you are in design, KS, SCO, TI, I&C, COL etc and are in the business of providing product or service that ends up going to a NA CDMA customer, high chance you will be in the 2,500. Now, what of the people who support a CDMA customer in a location outside of NA? These are the ones who should be concerned about their future. However, MikeZ has committed to supporting these customers, so a possibility that they will stay on to maintain support/upgrades etc.

4. Last, but not least, to everyone still at Nortel, is to keep a cool head. Worrying is not going to help. There is enough crap on TV these days to keep us down, which is why I hardly watch TV! Focus on what you are grateful for right now (like having a paycheck and benefits), not on all the terrible things that could happen. But for goodness sake, realize this - Nortel, or any employer does not owe any of us a guarantee of job. Those days stopped a generation ago, and even the unions are losing the battle. In the end, it is only up to one person - and that is you. Only you control your future, so if you don't have a "plan B", start working on one.

And if we end up in NSN, who's to say that they won't undergo a restructuring in the future, or the technology landscape changes, then we're right back to where we are today - deja vu. Welcome to "allaboutNSN".

It's a shame that our educational and social system trains us to get a good education, get a good job, and then retire at 65. Fact is that more than 80% of people that make it to retirement age don't have enough money to maintain their living standards and have to downsize or keep working.

So someone who has worked for Nortel for 20 or 30 years and as a result is now too old to find a new job with prospects should just smile and say thank you to Nortel management.

Heck no, My husband fits your criteria perfectly. We will be selling the house quickly (I hope quickly) and hitting the road. No severence, and the pension? At best inadequate. No job prospects.
Tough enough. Won't help a bit to fuss. Does it?

Thanks! I am a spouse of an employee, so my understanding is limitted. My husband has made it clear that if he has to go down with the ship, he wants to do it as a gentlemen. He won't be fighting over the lifeboats.

Agreed. Fighting over "lifeboats" is unseemly. Hopefully everyone has gotten their financial houses in order and are working on their "Plan B" for employment. I do wish you and your husband the best.

Thanks! Best to you too...
Life is not money, is it?

That is scary. I heard similar thing about Supply chain. Chain supply chain suddenly added some folks from LTE.

this is what Nortel is good at though don't you see. All the mgmt brain power is being diverted to figuring out how save its own ass. Time to put a fork in it!

Management will be the first to go ... do you think NSN needs Sr. Manager or Director levels to run their business, not to mention a "VP"?

I hope ex-Nortel NSN leadership works through the transfer list before hand and weed out the bottom-feeders that don't deserve to be transferred, who should have been canned long ago if it were not for the Nortel "buddy system" ... you know who you are.

NTragedy,

If an employee has been there 15+ years, then he is either very valuable to or very liked by (or both) someone in a director or VP role. For the latter, they have now run out of luck, finally.

You are right.
These overpaid, undervalued, ego-centric turds who were hanging on just cause their manager liked them or liked to watch then kneel at their feet got the boot in the last big culling that started in the new year. Not all, but more than usual.
Long way to go though at that place.
Hopefully they'll keep it up and the new buyers will increase this necessary carnage. Hard to say though what will happen. If a useless manager or employee can swing the opinion of or make the hiring buyer think they actually offer something, they'll still be able to hang around the club No?

NORTEL =

Not
One
Responsible
Telecom
Executive
Liable

And that's the "painful truth!" ;>)

bravo, bravissimo..--bb

as a d-level manager in a CDMA department that will be part of the purchase, there are some very distressing items to me and my peers taking place. our director, Mark Slater, and our VP Noy appear to be playing a shell game with the semantics of the NSN contract. According to them, 80% of CDMA/LTE will be part of the purchase (forget the 2500 number), and so they're throwing what appears to be life preservers to all of their buddies and bringing them into our organization, leaving all of us that have been around for some time to wonder what they're thinking. speculation is that they're growing to create a new bottom to lop off when they determine the 20%. as any one can imagine this is very concerning to us but not entirely surprising given some of the tactics they've done in the recent past, getting rid of good people without severance to take on people from other departments. if this deal doesn't go through i don't know what i'll do but i hate to think of the consequences of the 20% of those that are cut lose. we're also learning that we'll not be able to cary over our vacation but instead be just given a payout and start at ground 0 with accumulating new vacation time.

Whatever the outcome of NSN’s bid I assure everyone that NT’s management (an obvious oxymoron) will get their bonuses for completing the deal! These yoys don’t miss a (bonus) beat...-- bb

if someone beats it by $21 million then will NSN have to pay a similar $21 million to bid over on top. if not then it is not fair.

dont see any liability if nortel were to break the deal or do these millions come from nortel.

If someone else really wants CDMA, I will they can a hit on 16 million dollar.

Karma - what goes around comes around. It could get messy.

Any new bids would also have to pay a $16M break up fee as well as the $5m making it a minimum $21M bid over Nokia

Can Mize Z, Hackney, Lowe, Carey and all the other worthless "leaders" and there ya go ... $21M saved ... well worth it.

On bidding process the creditors are being clueless here.

The Stalking horse is in the drivers seat. This is normal, it is to encourage someone to place that first serious bid. A minimum $5 Million bid increase is only common sense on a $650 Million starter bid. That is like insisting a 50 cent minimum increase on a $65 dollar start. Most people would probably agree on 1 dollar minimum at that point. Look up 363 process. "363 bidding procedures include expense reimbursement, bidding procedure influence leading to a favorable advantage and stipulations in the bidding procedures that call for: (i) the stalking horse to receive a breakup fee if another bidder offers more, (ii) competing overbids higher by at least a specified minimum amount, and ..."


But MatlinPatterson takes the clueless cake:

http://www.reuters.com/article/bondsNews/idUSN2634658620090626
MatlinPatterson argues that the current bidding process fails to pay sufficient attention to the "going concern" option.

These Nitwits want to take more time exploring the possibility of making Nortel a going concern, they have no idea how damaged Nortel is internally. How badly we are being crippled as key people leave. Every delay devalues the asset.

2 weeks delay and rule changes might be enough to lose NSN. Think Microsoft-Yahoo deal that collapsed, think IBM-Sun. It doesn't take much to mess up a deal.

Time is not on Nortel/Creditors side, there is no "going concern" option and every day the asset values shrink as customers/employees flee during the uncertainty. If they screw up NSN deal. I guarantee, they will not emerge as a going concern, and they will get less than the NSN offer. Morons.

"These Nitwits want to take more time exploring the possibility of making Nortel a going concern, they have no idea how damaged Nortel is internally. How badly we are being crippled as key people leave. Every delay devalues the asset."


If these bozos(Mike Z and his cronies) ddin't mention their intent to sell off all the other units,then maybe customer connfidence wouldn't be so shaky and defection wouldn't be as high as it is.

It is pretty clear to anyone with a half a brain that Nortel's current management are a bunch of morons,and I wouldn't be surprised to find out that there was some kind of backdoor shenanigans that benefit the current management if it is Nokia/Siemens that does end up getting Nortel's CDMA wireless business.

Dear Psychiatrist,

If memory serves me well I recollect that formerly you were a staunch defender of Nortel’s management (an obvious oxymoron) and more than once I accused you of being part of Nortel’s PR machine.

However, recently your entire position has turned 180 degrees. Could you please provide a bit more info on your current/prior involvement w/Nortel, if any. Just curious; if my instincts were correct I would certainly like to know; if not, then I offer my sincerest apologies. Best..--bb

bb

your right,at one time I was a staunch defender/supporter of Nortel's management or more specificly Mike and his lip service to shareholders.Needless to say that over the last year with seemingly one disappointment after another and what seems to me unfulfilled promises and commitments by him,I have obviously changed my tune about management.

The insight gained from this blog also helped me to see the otherside of things,things that don't get mentioned in the paper or admitted by management at qtrly conference calls.

With that being said,I can also assure you that I was never part of Nortel's PR scheme but just a shareholder that unfortunately afforded Z and his cronies too much credit,it was always my nature to give people the benefit of the doubt and it cost me dearly with Nortel.

Ya you could say I finally saw the light,but it turned out to be a locamotive barreling down the tracks before I could make out what it was.

Your comments to this blog have been appreciated by me,too bad this blog wasn't around in 2000 for viewers or shareholders who could have benefited from the insight contributed by those on the inside.As expected there will always be biased opinions from others but still enough info available to have made one think twice about the inner workings of Nortel's history of poor management.

Appreciate your candor and feel your pain. The best we can learn from this is to be a lot more skeptical and cautious when dealing with authority of any kind or as Ronald Reagan once said: “Trust but Verify”… -- bb

It's a cycle. Nortel screwed the creditors and now the creditors will screw the existing employees who have a chance of moving over to NSN as soon as August.

It's a dawg-eat-dawg world out there. Everyone's busy looking after Number One.

$650 million for a technology that will be replaced in the next few years, which means hundreds of millions more required to upgrade those CDMA customers to whatever wireless protocol wins the race (probably LTE). I am sure Nokia factored that cost into the price they are offering for the wireless unit. And I understand the creditors want as much as they can for each business unit, but you have to have competing bids to make that happen. We'll see if anyone answers the stalking horse. If Nokia really did get the unit for a song and a dance, you would expect a flurry of competing offers. And given the amount offered on the table by Nokia, I really don't think asking $5 million more is going to dissuade other interested parties.

Where the heck is this $700M profit crud coming from? The COMPANY.. called NORTEL.. lost almost SIX BILLION last year. Was wireless NOT part of this pathetic company? Looks like NORTEL is cooking the books yet again and assingning the 2008 loss to the last man standing. Wow, if every business on it's own sheds it resposibility in then 2008 tsunami things don't look so bad.

Frank Dunn is going to go to jail.. let's put the $6B loss on his credit card and maybe we could all get our jobs back.

CDMA was paying everybody’s salary for almost nine years.
If it wasn't for the CDMA Nortel would have gone under eight years ago.

I believe Passport also had a hand in paying other groups salaries.

Because I am still somewhat p*ssed, here is more clarification:

Amen! If it wasn't for the arrogance of other businesses in Nortel, they would have gotten their heads out of their a**es and they would have seen that. But they were too busy pumping up their own importance! On this blog, I have only heard how we should have gotten out of the Wireless business a long time ago. Maybe we should have! And then Nortel would have been disolved 8 years ago instead of 2009, since no OTHER LOB was making any money!

Amen! If it wasn't for the arrogance of other businesses in Nortel, they would have gotten their heads out of their a**es along time ago and seen that. But they are too busy pumping up their own importance!
On this blog, I have only heard how we should have gotten out of Wireless a long time ago. Maybe we should have and 8 years ago, Nortel would have been disolved instead of 2009

Nortel surreptitiously screwed somebody. This time its creditors (again!). Are we supposed to act surprised?

There was nothing surreptitious about that whole place if you worked there. It was all out in the open, and embarrassing to have to be seen with in company.