Ericsson successful bidder for Nortel wireless assets

TORONTO — The heart of Nortel is going to Ericsson for $1.3 billion, pending a stamp of approval by courts in the U.S. and Canada. Following an auction conducted yesterday, Nortel has Nortel-152X39.JPGannounced that Ericsson will acquire substantially all of Nortel's next generation wireless portfolio.
If approved by the courts in a joint hearing Tuesday, July 28 (Ed. note: Court approval was obtained in record time), Ericsson will purchase Nortel's CDMA business which is the second largest supplier of CDMA infrastructure in the world, and substantially all of Nortel's LTE Access assets giving it a strong technology position in next generation wireless networks. Also as part of this agreement, a minimum of 2,500 Nortel employees supporting the CDMA and LTE Access business will receive offers of employment from Ericsson.
Nortel President and Chief Executive Officer, Mike Zafirovski, says, "The anticipated sale . . . represents a very positive prospect for our customers who will be able to continue their relationships with a long term partner; for employees who will have new opportunities at Ericsson and for many of our other stakeholders.
"Nortel remains focused on finding the right buyers for our other businesses while continuing to maintain excellent customer service levels. We are determined to maximize value while preserving innovation platforms, customer relationships and jobs to the greatest extent possible.
Carl-Henric Svanberg, president and CEO of Ericsson says: "We at Ericsson look forward to integrating Nortel's products and talented employees into our business and realizing the full potential of our combined strengths. Ericsson is committed to meeting the needs of our new CDMA customers today and bringing the next generation of mobile broadband to the world with LTE."
While today's auction is a significant step in the overall sale process, it is not the final step. Nortel will work diligently with Ericsson to close the sale later this year. As previously announced, the Company does not expect that its common shareholders or the preferred shareholders of Nortel Networks Limited will receive any value from the creditor protection proceedings and expects that the proceedings will result in the cancellation of these equity interests.

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