Canadian government to review Nortel’s Enterprise sale to Avaya
Nortel unit sale to be reviewed
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Local Tech Wire, The AP
RESEARCH TRIANGLE PARK, N.C. – The sale of Nortel’s Enterprise business group, which includes an unspecified number of its 1,800 employees in the Triangle, faces review by the Canadian government.
Bankruptcy courts in the U.S. and Canada have already endorsed the sale of the Enterprise group to privately held Avaya, which is based in New Jersey. A protest of the deal by Verizon was rejected by the U.S. court.
Canada's industry minister said Thursday he will review the deal to determine if it significantly benefits Canada.
Most of the Enterprise business group operations are based in RTP and Richardson, Texas. The head of the group, Joel Hackney, is based in RTP.
The insolvent company announced last week it would sell the Enterprise division to New Jersey-based Avaya Inc. for $900 million.
The Enterprise unit supplies landline phone systems and other communications equipment to businesses and large organizations around the world.
Industry minister Tony Clement told an investment group that the Canadian government will review the deal under the Investment Canada Act to ensure the transaction benefits the country.
Earlier this week, Nortel announced plans to sell its last major unit, its Carrier Networks business in an auction.
The assets include software to support the transfer of data over existing wireless networks and the next generation of wireless communications technology.
Nortel said it also expects to grant the buyer a non-exclusive license of relevant patent intellectual property in connection with the sale.
The proposed auction follows several others for the company, which is slowing selling its parts off under court bankruptcy protection from creditors.
Besides the sale to Avaya, Nortel has sold its wireless business to Sweden's LM Ericsson for $1.13 billion.
The Canadian government does not plan to review the Ericsson deal because the book value of the wireless unit is below the review threshold.
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