The M&A Plot Thickens

By Mark Evans | Published: July 14, 2009

Looks like Nokia Siemens could have some competition when it comes to Nortel’s assets.

According to the Ottawa Citizen, there are at least two groups interested in Nortel’s assets.

For more insight into Nokia Siemens, check out this video of Sue Spradley, who heads up Nokia Siemens’ North American operations.

Spradley, of course, was Nortel’s president of global services and operations before leaving the company last November. She was recruited by CEO Mike Zafirovski from IBM.


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  • TongueInCheek

    Mark, your statement about Spradley being recruited by Mike Z from IBM is false. Even in the CTV interview she stated she worked at Nortel for 18 years.

  • Another_Nortel_Watcher

    You have Spradley mixed up with Flaherty.

  • NortelTragedy

    No Mark, you are mixing Sue up with Lauren Flaherty, the CMO Mike hired from IBM.

  • ChaiTea

    If NSN is so determined to pick up CDMA/LTE, its gonna cost them a lot more than their low ball bid. I wonder if they will be forced to shell out more than USD1.2Billion.

    Wonder how deep their pockets are. They just finished a 2BEuro 3 year loan agreement with a syndicate of banks.

  • Asset_Number_XXX

    So many news on how others plan to save Nortel, so little on how Nortel plans to save Nortel. I can't get rid of this image of a motionless corpse and a growing number of circling predators.

  • Moose_Chaser

    >>> BUZZ !!! <<<

    WRONG – Lauren Flaherty was recruited from IBM, not Sue Spradley.

    Sue Spradley is a tuff-talkin' Texan. Hope she stays there.

    MC

  • Teleguy

    Mike Z fired Sue Spradley, along with Brian McFadden. I would have kept her, but he was phoning it in and deserved to be bounced.

  • unknownPath

    I am pretty sure a couple of weeks ago the towel was thrown in. There is no Nortel planning to save Nortel. Unless there MP give the reins back to the executives once (if) they buy the company.

  • farscape

    The wrong info appeared in the Ottawa Citizen article form which ME is quoting.

  • NTInfidel

    One group headed by John McFarlane, wants the assets that Nokia doesn't want.
    The other group headed by 77 year old Ferchat wants the whole thing(senile?).

    Neither of these two groups has the financial backing, so are dreaming at the moment.

    So we are back to MP and their dubious, we want to buy it all threat. One week to find out if that was for real.

  • FraudEqualsJAIL

    so little on how Nortel plans to save Nortel.
    ====

    Deceit Made Simple

  • ChaiTea

    Lets start a “Who wants to be a vulture capitalist” thread. if you had USD2.5B to invest, how will you bid? The following would be my bids :-)

    CDMA/LTE: USD 1300M
    Enterprise: USD 500M
    MEN: USD 500M
    CVAS: USD 150M
    GSM: USD 50M

  • NTblinker

    You smashed NSN two times, so it will be very hard for them(NSN) to recover after this move.

  • NTblinker

    i 100% give support to MP in next week's auction, but i have also some sadness to hear words that they may sell off the enterprise part. No sale to all parties, don' t even think it please!

    Everyseller is a loser too! Only buy!

  • Wapuka1

    MIke Z pushed Sue Spradley out the door after she told him that he was clueless about the networking business and that his 'grand strategy' was going to be a failure of epic proportions.

  • Wapuka1

    There is almost no private capital available to fund the type of private 'buy out' that Nortel's surviving employees are dreaming about. Besides Nokia, the aforementioned interested parties do not have the capital to purchase a substantial set of Nortel assets and are hoping to either 'steal' them or to have the Canadian Government somehow provide magical funding for a deal.

    As for bidding on Nortel's CDMA & LTE assets, there are very few potential for these assets, and only one or two that could top Nokia's bid. It will be very difficult for MP to raise sufficient capital to offer a bid for all of Nortel that would trump the Nokia bid bid for just the CDMA & LTE assets. MP's goal in any buy out would be to made whole on their $400M bond holdings plus to be able to pay back all borrowed capital and interest payments within 18 months, plus generate a substantial profit by dismembering most of Nortel via cash sales and then spinning off substantially smaller entity to some 3rd party.

    For the past 3 1/2 years I have been saying that Nortel was careening towards bankruptcy and them dismemberment and I was right. Now I am saying that it will be almost impossible for MP (or any other private entity) to raise sufficient capital to satisfy the claims of the other 90% of the bond holders, and submit a bid that would be acceptable to the courts versus the Nokia bid. It is also obvious that MP believes that it has no obligations to current employees, severed employeees, or pensioners. Current Nortel employees had better be aware of the salient fact that MP's only objective is to get the maximum return for its investment. This would mean that all employees would be facing the renegotiation of all labor contracts at substantially lower pay rates (probably by at least 25%) and with substantantially fewer benefit costs.

  • ChaiTea

    >>>Now I am saying that it will be almost impossible for MP (or any other private entity) to raise sufficient capital to satisfy the claims of the other 90% of the bond holders, and submit a bid that would be acceptable to the courts versus the Nokia bid.

    In the past MP has offered shares (in lieu of current debt) in new entity that it resurrects from bankruptcy. They will offer it again to current debtors, and it remains to be seen if it is accepted.

    If they can get over that hurdle, then the next one is raising capital for the Nortel assets they want to bid on. How much is this? Perhaps 2.5B to 3B USD. I agree that this is a big amount to raise. It remains to be seen if they can pull it off.

    BTW, my preference is for NSN to win. However I dont think MP should be underestimated.

  • wasthere

    So Sue Spradley is now sent by Nokia-Siemens to play a little scaring game ! ''Watch out, if you don't take our ridiculously low offer, more jobs can be lost ''. Anything coming out of Sue Spradley's mouth should be take with a grain of salt. She was talking a lot(conf calls, re-org speeches etc) when she was with Nortel but nothing concrete never came out of all her blah blah. Her last task with Nortel was organizing a big marketing campaign.Don't even remember what it was all about because as everything else, it never really materialized and then she was fired !
    I just hope, that the creditors vote for the best offer and don't get screwed like the shareholders were. The 650 millions offer by Nokia is a pure joke !

  • scalppeeler

    It is a joke and NSN know it.
    For sure they are saying exactly what you said.
    Reject our offer and we layoff more.

  • scalppeeler

    Straight talk.

  • vvvv

    Working for Sue again would be a blast.

  • NTblinker

    like if you extend the bidding deadline, we would reduce the $650M price. These NSN guys are much more vulture than the other capitalist funds. we really mustn't confide in them.

  • wasthere

    Yep, a blast in wages ! Probably a 20 to 30% cut in salary which would bring Nortel employees wages right in the average mean of the industry.

  • scalppeeler

    You been eating too much peanut butter.
    Nortel is in the middle or below the average regarding current wages for employees in that industry.
    Look it up Gomer.

  • Another_Nortel_Watcher

    And you know this how? You were there?

    Sometimes this blog, like many others, is very funny.

  • Another_Nortel_Watcher

    Sue Spradley is a solid operations-oriented executive and possibly sales at some level. However, when it comes to market insight and vision, I'm afraid she is a member of the Empty Suit Club, alongside Richard Lowe, the Choker, and das Fuhrer himself. I think the TV series 'Entourage' is based in part how she runs her organizations.

  • Another_Nortel_Watcher

    It is true that Nortel job categories are paid at a level that is median or less when compared with relevant jobs elsewhere, however it's my observation that Nortel is full of people in jobs 2-3 levels above their ability and these people would never be able to land a job at the same level in another company. For that reason, I think wasthere's point is valid. Many Nortel people will face that kind of a cut – or greater – to find a job they are qualified for outside Nortel.

  • scalppeeler

    I could say the EXACT same thing about workers at Alcatel Lucent or Cisco so your observation is flawed.
    Many people who leave AlaLu or Cisco for whatever reason will face that kind of a cut or greater also.

  • zeroman

    no biz plan either.

  • Another_Nortel_Watcher

    Yes for ALU, no for Cisco. Cisco hiring standards are tougher. ALU is another sick dog in the telecom sector so don't feel good because Nortel is comparable. Neither company has any vision at the moment.

    The whole telecom sector has been devalued. The adjacent industries are much more aggressive.

  • The psychiatrist

    laying off more employees will not bring any leverage against Nortel's creditors,after all it was they who directed management to announce ch 11 proceedings and we all know about the loss of severance and pension benefits as a result.

    The only ones who are in fear right now are the supposed 2500 that would be taken in by NS from the purchase of the CDMA business,and last time I checked upper management and Nortel's creditors could care less about the collateral damage that could be those 2500 employees.

  • wasthere

    Sorry dude, I did work there for so long to know what I am talking about. A big shunk of employees(canadian employees) are overpaid for the task they are doing. Just the facts.

  • wasthere

    Dead on !

  • tiredofitall

    So tell me then…what does a JCI 3 equivalent in Cisco earn? Total compensation.

  • tiredofitall

    Sorry, couldn't help but do the research myself. An average software designer at Cisco makes just over 89K in the US. The equivalent US-based Nortel software designer makes just over 85K. Level 3 and 4 (i.e senior designers) are pretty much on par between the two companies, mid-90s for level 3 and 105ish for level 4. My source is glassdoor.com.

  • mayday_Nortel

    I was wondering if someone else had picked this inaccurate statement.

    Had Sue as a VP for a while before she moved to Global Ops. Tough Texan girl but no results to show, specialy not when it came to a vision for product direction. (remember MPE, shasta, etc…)

    She was also named on the US National Security Telecommunications Advisory Committee in 2003. Boy did that help Nortel to get a coherent security strategy, some credibility or some contracts in the security field.

    Finally, what has she accomplished in Global Ops after replacing Charam ?

    I rest my case.

  • mayday_Nortel

    I was wondering if someone else had picked this inaccurate statement.

    Had Sue as a VP for a while before she moved to Global Ops. Tough Texan girl but no results to show, specialy not when it came to a vision for product direction. (remember MPE, shasta, etc…)

    She was also named on the US National Security Telecommunications Advisory Committee in 2003. Boy did that help Nortel to get a coherent security strategy, some credibility or some contracts in the security field.

    Finally, what has she accomplished in Global Ops after replacing Charam ?

    I rest my case.

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