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NSN links with investor for Nortel bid
19 November 2009
Nokia Siemens Networks is competing with Ciena for the metro ethernet networks unit of Nortel, in a link with a private equity arm of JP Morgan, in an auction due to be completed tomorrow
Comment: NSN looked to be veering more to the services side when Rajeev Suri was appointed CEO a few weeks ago — but this move shows that it still believes there is a role in making equipment. But the company is still working through the merger which created it and if it wins the November 20 auction for Nortel’s carrier ethernet business will have more digestive challenges.
Nokia Siemens Networks has placed a joint bid for Nortel Networks’ optical networking and carrier ethernet business in association with a private equity firm, One Equity Partners.
Ciena, another bidder for the Nortel unit, called metro ethernet networks, has offered $390 million in cash and 10 million of its shares, totalling $526 million. Ciena’s stock component is valued at $136 million.
The auction winner may get Nortel customers in Asia and Europe, including Spain’s Telefónica.
Nortel delayed the initial deadline for offers to November 17 and the final auction will be held on November 20.
Nortel, which was North America’s largest telecoms equipment maker, had filed for bankruptcy protection in January. NSN, now led by Rajeev Suri, was outbid by rival Ericsson for Nortel’s wireless assets earlier in 209.
One Equity Partners manages $8 billion for JPMorgan in private equity investments. GTB