Nortel Announces the Winning Bidder of its Patent Portfolio for a Purchase Price of US$4.5 Billion
TORONTO - Nortel Networks Corporation [OTC: NRTLQ] announced that it, its subsidiary Nortel Networks Limited (NNL), and certain of its other subsidiaries, including Nortel Networks Inc. and Nortel Networks UK Limited (in administration), have concluded a successful auction of all of Nortelís remaining patents and patent applications. After a multi-day auction, a consortium emerged as the winning bidder with a cash purchase price of US$4.5 billion. The consortium consists of Apple, EMC, Ericsson, Microsoft, Research In Motion and Sony.
The sale includes more than 6,000 patents and patent applications spanning wireless, wireless 4G, data networking, optical, voice, internet, service provider, semiconductors and other patents. The extensive patent portfolio touches nearly every aspect of telecommunications and additional markets as well, including Internet search and social networking.
"Following a very robust auction, we are pleased at the outcome of the auction of this extensive patent portfolio", said George Riedel, Chief Strategy Officer and President of Business Units, Nortel. "The size and dollar value for this transaction is unprecedented, as was the significant interest in the portfolio among major companies around the world"
The sale is subject to applicable Canadian and U.S. Court approvals which will be sought at a joint hearing expected to be held on July 11, 2011. Nortel will work diligently with the consortium to close the sale in the third quarter of 2011.
As previously announced, Nortel does not expect that the Companyís common shareholders or the NNL preferred shareholders will receive any value from Nortelís creditor protection proceedings and expects that the proceedings will result in the cancellation of these equity interests.
Certain statements in this press release may contain words such as "could", "expects", "may", "should", "will", "anticipates", "believes", "intends", "estimates", "targets", "plans", "envisions", "seeks" and other similar language and are considered forward-looking statements or information under applicable securities laws. These statements are based on Nortelís current expectations, estimates, forecasts and projections about the operating environment, economies and markets in which Nortel operates. These statements are subject to important assumptions, risks and uncertainties that are difficult to predict, and the actual outcome may be materially different. Nortelís assumptions, although considered reasonable by Nortel at the date of this press release, may prove to be inaccurate and consequently Nortelís actual results could differ materially from the expectations set out herein.
Actual results or events could differ materially from those contemplated in forward-looking statements as a result of the following: (i) risks and uncertainties relating to the Creditor Protection Proceedings including: (a) risks associated with Nortelís ability to: obtain required approvals and successfully consummate pending and future divestitures; ability to satisfy transition services agreement obligations in connection with divestiture of operations; successfully conclude ongoing discussions for the sale of Nortelís other assets; develop, obtain required approvals for, and implement a court approved plan; allocation of the sale proceeds of our businesses among the various Nortel entities participating in these sales may take considerable time to resolve ongoing issues with creditors and other third parties whose interests may differ from Nortelís; generate cash from operations and maintain adequate cash on hand in each of its jurisdictions to fund operations within the jurisdiction during the Creditor Protection Proceedings; obtain any further required approvals from the CanadianMonitor, the U.K. Administrators, the U.S. Principal Officer, the U.S. Creditorsí Committee, or other third parties; raise capital to satisfy claims, including Nortelís ability to sell assets to satisfy claims against Nortel; realize full or fair value for any assets or business that are divested; utilize net operating loss carryforwards and certain other tax attributes in the future; avoid the substantive consolidation of NNIís assets and liabilities with those of one or moU.S. Debtors; operate effectively, and in consultation with the Canadian Monitor and the U.S. Creditorsí Committee, work effectively with the U.K. Administrators, French Administrator and Israeli Administrators in their respective administration of the EMEA businesses subject to the Creditor Protection Proceedings; continue as a going concern; actively and adequately communicate on and respond to events, media and rumors associated with the CredProtection Proceedings that could adversely affect Nortelís relationships with customers, suppliers, partners and employees; retain and incentivize key employees as may be needed; retain, or if necessary, replace major suppliers on acceptable terms and avoid disruptions in Nortelís supply chain regardinour remaining stranded contracts; obtain court orders or approvals with respect to motions filed from time to time; resolve claims made against Nortel in connection with the Creditor Protection Proceedings for amounts not exceeding Nortelís recorded liabilities subject to compromise; prevent third parties fromobtaining court orders or approvals that are contrary to Nortelís interests; and (b) risks and uncertainties associated with: limitations on actions against aDebtor during the Creditor Protection Proceedings; the values, if any, that will be prescribed pursuant to any court approved plan to outstanding Nortel securities and, in particular, that Nortel does not expect that any value will be prescribed to the NNC common shares or the NNL preferred shares in any such plan; the delisting of NNC common shares from the NYSE; and the delisting of NNC common shares and NNL preferred shares from the TSX; and (ii) risks and uncertainties relating to Nortelís business including fluctuations in foreign currency exchange rates; the sufficiency of workforce and cost reduction initiatives; a failure to protect Nortelís intellectual property rights; any adverse legal judgments, fines, penalties or settlements related to any significant pending or future litigation actions; failure to maintain integrity of Nortelís information systems; and Nortelís potential inability to maintain an effective risk management strategy.
For additional information with respect to certain of these and other factors, see Nortelís Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other securities filings with the SEC. Unless otherwise required by applicable securities laws, Nortel disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
For the Companies listed below, The Institute of Chartered Accountants in England and Wales authorises A R Bloom, S Harris and C Hill to act as Insolvency Practitioners in the UK under section 390(2)(a) of the Insolvency Act 1986 and the Association of Chartered Certified Accountants authorises A M Hudson to act as an Insolvency Practitioner in the UK under section 390(2)(a) of the Insolvency Act 1986.
The affairs, business and property of the Companies are being managed by the Joint Administrators, A R Bloom, S Harris, AM Hudson and C Hill who act as agents of the Companies only and without personal liability.
The affairs, business and property of Nortel Networks (Ireland) Limited are being managed by the Joint Administrators, A R Bloom and D Hughes, who act as agents of Nortel Networks (Ireland) Limited only and without personal liability.
The Companies are Nortel Networks UK Limited; Nortel Networks SA; Nortel GmbH; Nortel Networks France SAS; Nortel Networks NV; Nortel Networks SpA; Nortel Networks BV; Nortel Networks Polska SP Zoo; Nortel Networks Hispania SA; Nortel Networks (Austria) GmbH; Nortel Networks sro; Nortel Networks Engineering Service Kft; Nortel Networks Portugal SA; Nortel Networks Slovensko sro; Nortel Networks Oy; Nortel Networks Romania SRL; Nortel Networks AB; Nortel Networks International Finance & Holding BV.
In addition on 28 May 2009, secondary proceedings were opened in relation to Nortel Networks SA pursuant to which the French Court authorized Nortel Networks SA to continue to operate the business owned and operated by Nortel Networks SA and appointed inter alia the French Office Holders as the administrators and liquidators of NNSA who act as agents of Nortel Networks SA and without personal liability.
This news content was configured by WebWire editorial staff. Linking is permitted.