As Nortel continues to sell off its assets, there’s also been some housecleaning happening behind the scenes that suggest that the company is getting its financial house in order before the final push into the history books.
Case in point are a number of debt settlement deals that Nortel has been striking in recent weeks. The most recent is a settlement reached with IBM, which had filed secured and unsecured claims of more than $55-million through several subsidiaries around the world. The claim had to do with an agreement that saw IBM provide testing and development services to various Nortel businesses.
To settle the claim, Nortel will pay IBM $2.5-million.
In terms of what’s left on the table to sell, the list includes the carrier business, the joint venture with LG, and the more than 3,000 patents, including the much-sought LTE patents.
Drive by the Richardson campus at night. All kinds of signals that the end has come. The "Nortel Networs" signs on the tower are shut off....and of course no Christmas decorations on the lab building. Even the interior lighting that was "decorative" has been shut off. Of course reducing the electric bill should help someone get a larger bonus.
wasthere
Unfortunately 'beginning of the end' in Nortel terms rhymes with endless !
bankrupt_bob
"The beginning of the end," or in NT's case, "the end of the beginning," if past history is considered!
wasthere
As a creditor I see no problem in getting rid of some claims at 5¢ on 1 dollar like this one. Leaves more for ex-employees and retirees.
It looks as if he is asking Nortel to pay up to that amount should he be found liable by the courts. Could also be interpreted as providing financial protection to the others.
notthereanymore
Isn't the premise of CCAA to make all of the creditors go away to come back another day. IBM isn't the only one; Airvana, Flextronics and now IBM are getting side deals? Is this legal? I thought all unsecured creditors, including all employee related claims are treated the same. Guess there is another loophole somewhere and side deals are happening. Shame.
horace_grimswold
Herman Miller will fore go any outstanding claims on the 80,000 Aeron chains that were purchased by Nortel.
whopperscan
Interesting how they can start paying creditors out already, before they have finalized a pool of money to divvy up between them. That's a bad recovery rate for IBM huh? Guess they can afford to put it behind them, can't blame them.
Look at that one epiqsystems link in the story. The lawyers & administrators are making a fortune. Regardless of when the doors shut, they'll drag this out for years yet. Plenty of fees to be made.
The Beginning of the End?
As Nortel continues to sell off its assets, there’s also been some housecleaning happening behind the scenes that suggest that the company is getting its financial house in order before the final push into the history books.
Case in point are a number of debt settlement deals that Nortel has been striking in recent weeks. The most recent is a settlement reached with IBM, which had filed secured and unsecured claims of more than $55-million through several subsidiaries around the world. The claim had to do with an agreement that saw IBM provide testing and development services to various Nortel businesses.
To settle the claim, Nortel will pay IBM $2.5-million.
In terms of what’s left on the table to sell, the list includes the carrier business, the joint venture with LG, and the more than 3,000 patents, including the much-sought LTE patents.