Editor’s note: A former newspaper journalist, Mark Evans has been writing about the technology and telecom sectors since 1995. He writes the blog.

By MARK EVANS, special to Local Tech Wire

TORONTO – It’s been a long time since talked about the bankruptcy protection process, which started more than a year ago before moving into the “let’s sell everything but the kitchen sink” mode last June.

Today, Nortel issued a press release that talks about well it has done in managing the bankruptcy process and the asset sales, and how it has collected $1.2-billion more in proceeds than the original “stalking horse” sale agreements. (The update follows news this week that Nortel with is former Canadian workers, retirees and employees on disability.)

To be honest, it come across as self-congratulatory at a time when thousands of people have lost their jobs – most without any severance.

Nortel said it has raised more than US$2 billion in net proceeds from the completed sales of businesses, and that it expects to another US$1 billion from the completion of the previously announced sales of its Optical Networking and Carrier Ethernet (MEN), GSM/GSM-R and Carrier VoIP and Application Solutions (CVAS) businesses.

The gist of today’s announcement is that Nortel wants to retain a bunch of corporate employees who are “critical” to completing the “remaining work”, which involves selling off the rest of the assets.

As well, Nortel wants to explore “strategic alternatives to maximize the value of the Company’s intellectual property”. Now, this is interesting because it raises the possibility that Nortel could continue as a patent-holding entity that would generate licensing and royalty revenue.

Among the most coveted and valuable patents within the 3,000+ portfolio are about 100 related the LTE (long-term evolution) technology.

About the author: A former newspaper journalist, Mark Evans has been writing about the technology and telecom sectors since 1995. He’s the principal with ME Consulting (markevans.ca), a social media and content consultancy that works with companies to create and deliver great stories to capture the attention of customers, bloggers, the media, business partners, employees and investors.

The Nortel Press Release

(Note: The complete text of the press release appears below. The author included a link to it in his blog. The release is incorporated with the LTW post for your convenience.)

Nortel Networks Corporation (OTCBB: NRTLQ) [Thursday, Feb. 11] provided an update on its creditor protection proceedings.

Throughout the creditor protection process, Nortel has worked with its advisors and stakeholders to conduct the sales of businesses and other restructuring matters in a fair, efficient and responsible manner in order to maximize value for its creditors, and in almost all matters, resolution has been reached on a consensual basis. These activities have been and continue to be monitored closely by the courts, the court appointed Monitor in Canada, the U.K. Joint Administrators, the U.S. Unsecured Creditors’ Committee (UCC), the Ad Hoc Bondholders Group and other creditor groups.

"The Board of Directors of Nortel and the management team recognize the very difficult circumstances of the numerous and varying stakeholders of Nortel. We have been and continue to be focused on maximizing the value of the Company’s assets and securing the best possible outcome for our creditors, from employee groups to bondholders," said David Richardson, Chairman, Nortel. "The company continues to deal in the most equitable way possible with its stakeholders as a whole, while operating under creditor protection in Canada, the U.S., Europe and elsewhere."

Since determining in June 2009 that selling Nortel’s businesses was the best path forward, more than US$2 billion in net proceeds have been generated through the completed sales of businesses. Additional net proceeds of approximately US$1 billion are expected upon the completion of the previously announced sales of Nortel’s Optical Networking and Carrier Ethernet (MEN), GSM/GSM-R and Carrier VoIP and Application Solutions (CVAS) businesses. To date, auctions for sale of four businesses have yielded US$1.2 billion more in proceeds than initially set out in ‘stalking horse’ sale agreements. Through the sales completed or announced to date, Nortel has preserved 13,000 jobs for Nortel employees with the buyers of these businesses.

As recently announced, Nortel completed an agreement that will provide for the funding by Nortel Networks Inc, a U.S. subsidiary, of the Company’s continuing work in Canada through the remainder of the creditor protection proceedings. Nortel has also resolved outstanding transfer pricing issues with Canadian and U.S. tax authorities for the taxation years 2001 through 2005 and settled the US$3 billion claim of the United States Internal Revenue Service for US$37.5 million. In addition, Nortel has restructured certain intercompany indebtedness of its Asia Pacific affiliates to facilitate their ability to continue to operate and participate in global asset sales.

The Company most recently announced on February 8th that Nortel reached a settlement agreement with former and disabled Canadian employee representatives, on certain employment related matters regarding former Canadian Nortel employees, including Nortel’s Canadian registered pension plans and benefits for Canadian pensioners and Nortel employees on long term disability.

Focusing on work to be done – Corporate Group and Nortel Business Services (NBS)

While numerous milestones have been met, significant work remains to be completed. Nortel’s Corporate Group is focused on a number of key actions including the completion of announced sales and the sale of remaining businesses and assets, as well as exploring strategic alternatives to maximize the value of the Company’s intellectual property. The Corporate Group is also responsible for ongoing restructuring matters including the creditor claims process, planning toward conclusion of the CCAA and Chapter 11 process and distributions to creditors. The Corporate Group also continues to provide administrative and management support to the Nortel affiliates around the world.

The NBS Group continues to provide global transitional services to purchasers of Nortel’s businesses, in fulfillment of contractual obligations under Transitional Service Agreements. These services include maintenance of customer and network service levels during the integration process, and providing the expertise in finance, supply chain management, information technology, R&D, human resources and real estate necessary to the orderly and successful transition of businesses to purchasers over a period of 12 to 24 months. NBS is also focused on maximizing the recovery of Nortel’s accounts receivables, inventory and real estate assets.

Nortel is seeking approval of the U.S. and Canadian courts of an employee plan that is designed to retain personnel at all levels of Corporate Group and NBS critical to complete the remaining work. The plan was developed in consultation with independent expert advisors taking into account the availability of more stable and competitive employment opportunities available to these employees elsewhere. The plan is supported by the Monitor, UCC and Ad Hoc Bondholders Group. Koskie Minsky LLP, representative counsel to Canadian former employees, has been advised of the plan.

Approximately 88 percent of the plan’s costs is being funded by the purchasers of Nortel businesses, pursuant to the terms of the sales agreements. The purchasers have required that Nortel retain key employees around the world to ensure that the transition to them of the acquired businesses is as effective and efficient as possible.

"The scope and complexity of the work to date and that remains to be completed requires the efforts of our specialized employees around the world," said Mr. Richardson. "In order to meet our restructuring objectives, bring the process to conclusion and to fulfill our obligations to provide transitional services to purchasers of our businesses, it is essential that we retain the personnel with the required skills, experience and institutional knowledge. Accordingly, Nortel has developed a plan designed to incentivize these key employees to remain with Nortel until our work is completed."

Mr. Richardson continued, "The employees being offered participation in the plan were instrumental in the work completed to date and are critical to fulfilling the remaining tasks including carrying out the Company’s global fiduciary duties, selling and transitioning businesses, unwinding partnerships, addressing claims and analyzing thousands of contracts. The loss of these key employees at this time would create significant delays in our activities and place the achievement of our objectives at risk. In short, we believe the plan is in the best interests of our creditors and other stakeholders, and of the process itself."