A Bid to Save Nortel?

Is there hope for Nortel to continue as a standalone company without going through a firesale of all its best assets?

The Ottawa Citizen reports that MatlinPatterson Global Advisors, a $9-billion private equity investor, may be interested in bidding for Nortel.

MatlinPatterson’s biggest obstacle could be a lack of time it has to put together a bid by July 21 in time for a court-approved auction on July 24 of Nortel’s CDMA wireless business, which has attracted an offer from Nokia Siemens.

Whether or not MatlinPatterson can pull together a bid for Nortel is uncertain, it puts the spotlight on whether Nortel could have survived by going through a restructuring process that let it shed assets, facilities and employees while leaving it with an operating structure and business units to become a viable, albeit smaller, player.

Without having any insight into the restructuring process, Nortel’s senior management and board are taking the easy way out. Why not go out with a fight rather than bending over backwards to the demands of creditors? Sure, creditors want their pound of flesh but there has to be a better option than abandoning ship and casting assets overboard.

Instead, CEO Mike Zafirovski and his team are tossing in the towel after three years of bad choices, strategic mistakes and organizational paralysis.

If Nortel’s board had any chutzpah, they would consider giving another senior management team a shot of remaking Nortel instead of letting it blown up into smithereens.

Of course, the board has done little over the past decade to suggest it knows a better way so let’s not expect miracles now.

If MatlinPatterson can save Nortel and make a few bucks along the way, more power to it.

More: The Telecom Blog has a good post questioning why anyone would want to buy Nortel’s enterprise business.