Nortel Puts GSM Business on the Block

By Mark Evans | Published: October 1, 2009

Nortel is selling its GSM business – an asset that many people may have not been aware that Nortel even operated given its low profile.

Nortel said it will hold an “open auction” to sell “substanially all of its globa GSM/GSM-R business”. Qualified bidders need to submit offers by Nov. 5, while the auction will be held Nov. 9.

“The proposed sale process will provide a timeline for identifying the successful bidder for our valuable GSM/GSM-R assets,” said Pavi Binning, who is now Nortel’s Chief Restructuring Officer. “The process is expected to result in a formal agreement with a buyer. We have seen interest in this business during extensive initial discussions.”

Potential buyers of the GSM business includes Ericsson, Huawei, Nokia-Siemens, ZTE and Alcatel-Lucent.

Note: Here’s the Nortel press release about the proposed GSM sale.

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  • gone2moro

    There have been on going layoffs since last fall…. there aren't any “rounds”…..

  • GoProto

    “I am not arguing that the BoD acted responsibly. In fact, they failed in every respect in representing the shareholders interest. “
    —————————
    Maybe not, but much of your post is referring to how Normal Companies are Normally run, and well you just can't put Notell in that bucket. They are like no other.
    ______________________________________________________
    “If you didn't like the BoD or management, you should have dumped a long time ago”

    If what they were doing was transparent, I may have, but instead people were relying on information based what they were told was The Truth: Forecasted profits, Re-stated Re-statements, only to find out it was lies upon lies, fraud and deceit all around, cooked books and even to the end, IMO Fake CH11 covering for what really looks and smells like Liquidation, i.e. CH7.

  • yes4aapl

    Like it or not, the shareholders representation is the BoD which IS elected by shareholders.
    —–
    re
    In case of NT you are wrong.
    There was no way to get shareholders representation on BoD.
    Robert Verdun tried to make changes. Nortel used all the tricks available in Nortel's crooked books of business to distance themselves from shareholders. In case of Bob Verdun Nortel distanced itself physically as well by organizing ASM in far East of Canada.
    When was it? Who was Robert Verdun?
    lets google that
    http://www.google.ca/search?q=robert+verdun+nor…
    in other words
    Don't try to blame investors that there are crooked Boards of Directors like Nortel's one.
    Yes, some investors dumped NT stock in 2001, you remember?
    They did not like BoD of 200-2001
    Yes, some investors dumped NT stock in 2004 when the accounting fraud accusations were made public.
    Some investors believed new CEO Bill Owens and some investors were defrauded by another CEO, Mike Zafirovski. In case of Enron we know the final story. We are waiting here for final chapters for Nortel saga of frauds and deceptions. It has to have happy ending, you know? Investors have to gain back confidence in Toronto stock market or else….

  • scoop1985

    Given all that you say, why invest in Nortel in the first place? Given that you were lied to, why hold? Why go down with the ship and then claim to be a victim? Debt holders and creditors did not have an option to sell out and take what they can get. I know the story, I was a 22 year employee that was laid off, but I stopped buying Nortel stock a long time ago as I did not see it as a good investment. And I did start looking for new work as I realized that it was not a good company, at least not in its current state and with the current management thinking (or lack thereof).

  • yes4aapl

    Given all that you say, why invest in Nortel in the first place?
    —–
    re
    Maybe just because NT stock was traded on NYSE and Toronto?
    Because investors believed NT follows the rules of reporting numbers.
    Because CEO promised turn around supported by reported numbers of margin improvements /false numbers as I know now/
    If one sells its shares another investor buys them so in the big picture there always is a victim of crooked stock to the very end as long as it is listed.
    I posted about six big losers of Mike Zafirovski stock manipulation. google “six gig losers” with the spelling mistake, pls
    There were six big investing funds who bought NT around the time Mike gave the speech to investors (Nov 2006)
    funds like Wellington, Brandes, Dodge and Cox … lost around $1 bill on Mike's false stories. They were naive enough to average down in years 2007-2008
    That's the big picture

  • less

    Argh.

  • GoProto

    I could reply, but yes4 said everything I was going to say.. But have to add this in plain ole English: Duh! Do ya think we knew we were being lied to???

  • GoProto

    Thanks for stepping in yes4…

    GP

  • Another_Nortel_Watcher

    The Shareholders do have a voice. Year after year, the shareholders ELECTED the BoD to represent them. The shareholders got what they deserved for ignoring the process or signing over a proxy vote. The shareholders – the owners – are ultimately responsible for what has happened to Nortel. The BoD are their chosen representatives, and the chosen representatives selected and backed the GEniuses, then stood by and did nothing as the GEniuses ran the company into the ground.

    The employees, on the other hand, got screwed. They had the GEniuses inflicted upon them and were almost helpless as the company crashed. I say 'almost' helpless because that 'I believe' crap could have been something much more effective. For example, imagine if the energy of the employee and retiree community had been focused on going to the government early to plead for help to change the leadership, which was obviously incompetent and out of control.

    A few people posted on this blog, but other than that, nobody did anything. Inaction from many perspectives is what killed Nortel.

  • scoop1985

    You guys are too funny! The stock market has always been buyer beware. Do your homework and due diligence. What track record did Z or anybody else have to give you the belief that they could turn it around? When quarter after quarter did not pan out, why did you still believe that the turnaround was just around the corner? Did you drink the koolaid or were you simply ignorant/lazy investors? Duh? It's your money. Stop playing the victim.

  • Nortel watcher

    Is CVAS in the Americas being impacted by layoffs the least since Nortel filed CH 11 or has the axe been felt equally there too?

  • The psychiatrist

    you bring up an important point in that when I look back at the last 5 plus years I held Nortel stock,I can see now that things didn't always appear normal like the constant inability for Nortel to actually make a profit without any of the “one time gains” that became so regular at their qtrly results.In adition to that I actually now believe that Nortel's rise to fame on the count of Roth's “right angle turn” into optical was a fluke and that compared to other players in the industry,Nortel was weak in many other areas of its organization-this not on the count of employees,but management of course and let's not forget about complacency within the BoD.

    Looking back also it now is quite clear that anyone on the outside whether it be shareholders,analysts,media etc could never really get a clear understanding of what and where Nortel was relative to its competitive edge or actual financial health,because everytime the CEO spoke it was always laced with unjustified optimism,which was most likely to justify the paychecks management were getting as well as to preserve employment within the management structure.

    The best example I can think of is when Mike Z had initially announced the reduction of 300-400 management positions,but then out of nowhere that number was drastically reduced.

    The bottomline is that Nortel's top leaders could never get a straight answer from the many levels of management beneath them and this ultimately forced Nortel into chapter 11.

    The most digusting thing in all of this is that management continue to pillage the company as it gradually disappears into liquidation.

    Don't kid yourself Z is probably sitting somewhere with his millions for what amounts to ultimately failing on what he was originally hired for.

    Another difference between Nortel and many other companies is that they don't take a pay cut if the company does poorly in one year as did Cisco with their executives,because

    1)Nortel leaders knew that if they self imposed that policy none of them would have ever been entitled to the compensation they earned while Nortel continually eroded.

    2)Cisco had no problem doing this because they knew there was always next year to make up for a bad year,whereas Nortel executives probably secretly knew that there may not be a “next year”.

    Jan 14 2009 has proved this.

  • bankrupt_bob

    Another case of “representation” that is not really that. If “we” really had a choice, there would be a “none of the above option” when votes are cast. The same goes for our “government.” ;>)

  • bankrupt_bob

    Methinks Shakespeare knew of this company;>)

    “To-morrow, and to-morrow, and to-morrow,
    Creeps in this petty pace from day to day,
    To the last syllable of recorded time;
    And all our yesterdays have lighted fools
    The way to dusty death. ” — Macbeth (Act 5, Scene 5, lines 19-23)

  • nortelex

    Layoff is pretty much depending on how aggressive your management is to get their bonus or in some cases to save their own behind.

  • gone2moro

    Nothing new to report on there Mark? 4 days and no new post. That's got to be a record for you.

  • bankrupt_bob

    Haven't you heard? No noose is good noose. ;>)

  • GoProto

    You may think my decisions were not as smart as yours, and i have my reasons for what I did, but you don't know me, so to call me ignorant or lazy is more than a little far-reaching and narrow-minded. As far as playing the victim, your tone and word choices sugget you are far more angry than I am. Perhaps, You were not too smart to have worked for such a company for 22 years. Long time to stck around Kool-Aid free.

  • GoProto

    Thanks Doc, yes Normacly was quite lacking.

    Your #2) Hits the nail on the Head IMO. I think the underpinnings of what occurred on Jan 14, 2009 were well known by Insiders for many, many months, if not years ~ previous to the rest of us. I hope it all comes out in the fraud trials..

  • scoop1985

    As you say, I had my reasons, but made the decision to leave last summer, put up my hand and worked a severance package. It would have been a smart move had not 1/14 happened, but then again I never claimed to be that smart.

  • protosphere

    http://en.wikipedia.org/wiki/Nortel

    In June, Nortel announced that it no longer planned to emerge from bankruptcy protection, and would place all of its business units for sale.[1] Nortel shares were delisted from the Toronto Stock Exchange on June 26, 2009 at a price of $0.185 per share, down from its high in 2000 when it comprised a third of the S&P/TSX composite index.[1][2][40] Mike Zafirovski subsequently resigned in August, and Nortel's board of directors was reorganized with three members instead of nine.[4]

    Nokia Siemens Networks made a stalking horse bid to purchase Nortel's CDMA and LTE assets for $650 million.[1] By the July 21 deadline for additional bids, MatlinPatterson and Ericsson had made offers,[41] and Ericsson emerged as the victor in the following auction, with a purchase price of $1.13 billion.[7][42] Avaya won an auction for Nortel's Enterprise Solutions business for $900 million,[8] after having placed a stalking horse bid of $475 million.[43] At the end of September, Nortel announced an auction for its GSM business, with bids due by November 5, 2009.[44][45]

    ______________________________________________________

    LG, Patents, and MENs left to liquidate.

    Sounds like some one is dragging their feet as these units decline by the day and creditor claims soar with time.

    Why the traditional NoTell delays.

    No wonder the IRS wants judge Gross removed, I am surprised they didn't protest the court appointed monitor too.

    Who obviously benefits from these delays to loot the corpse? What will be left?

  • GoProto

    “In June, Nortel announced that it no longer planned to emerge from bankruptcy protection, and would place all of its business units for sale.”
    ———————————————————-
    What did Nortel do between Jan 14 and June to indicate they had Any Plan whatsoever, aside from Z promising one would be “forthcoming soon”.. “in a couple of weeks” . Delays delays delays from the very beginning.
    Nothing will be left.

  • marakigirlexnortel

    Pavi Binning is currently Nortel's Chief Restructuring Officer. What happened to the CEO Mike Z? Anybody know?.

  • vestedinterest

    CIENA publicly stated today that they are in advanced negotiations to buy MEN.

  • less

    I've heard rumor of a few good folks having been shuffled into CVAS not long ago – just like lightbulbs were shuffled off campus in support of Nortel stock.
    What that means I can't say with certainty without looking around a bit

  • zeroman

    you must have been part of the few who actually worked. 1500 + people in MEN. what the hell do they work on?

  • frustratedexemployee

    You don't think that Mike was going down with the ship did you? He took his millions earned over the past several years and ran.

  • frustratedexemployee

    You don't think that Mike was going down with the ship did you? He took his millions earned over the past several years and ran.

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