Mike Z. on the CDMA/LTE Wireless Sale

For what it’s worth, here’s Mike Zafirovski’s e-mail to employees in the wake of Ericsson’s $1.13-billion purchase of Nortel’s CDMA wireless business and LTE R&D unit:

Team Nortel:

This has been an eventful week for our company. The interest we have seen in our CDMA and LTE Access assets is further proof of what we have always known: Nortel’s people, businesses, its innovations and customer base have considerable value in the eyes of industry players.

Today, we confirmed that Ericsson is the auction winner based on a purchase price of US$1.13 billion. While the auction and announcement of the winning bidder have generated a great deal of interest, I know these events have also caused uncertainty for some of you. That is understandable. We do not have all the answers yet, but there will be GIS’s, documents and websites opening in the coming days which will address many of your questions.

I want you to be assured that we will move rapidly to complete the deal and implement our transition plans. While the deal is expected to bring opportunity to a minimum of 2,500 employees, not everyone will be offered a role at Ericsson. Offers may begin going out as soon as the next few weeks, but it may also take a month or more until opportunities have been closed and selected employees have his or her future role defined.

The final purchase price of US$1.13 billion is clear proof that a tough market has not diminished the value you have all created. Further, it’s important to note that this sale price does not include cash and most receivables and payables, which stay with Nortel.

While today’s auction was a significant step in the overall sale process, work remains to complete the sale. U.S. and Canadian court approvals will be sought at a joint hearing on July 28. There are also regulatory approvals and other common closing conditions that must still be addressed. If everything proceeds as planned, we expect to close the sale later this year. Meanwhile, we remain focused on finding the right buyers for our other businesses, including the conclusion of the recently announced Enterprise stalking horse asset and share sale agreements.

Most importantly, a smooth integration will be key to Ericsson realizing the full value of their acquisition, and therefore the best outlook for those who will move into Ericsson. It’s critical that we continue to service customers and drive our deliverables – our plan assumes that nothing changes in the work you do every day, unless your manager comes to you specifically with a new assignment.

I want to thank you again for helping us move through the sale of our businesses in an orderly and professional manner. I continue to be deeply impressed and respectful of all your many contributions.

Thank you for all you are doing for Nortel.

Mike