Nortel To Open First Asia Global Operations Center Of Excellence In China

TORONTO - Nortel* [NYSE/TSX: NT] is to open its first Center of Excellence for Global Operations in Asia, based in Shanghai, China. The Center of Excellence, building on an existing supply chain facility established in 2005, is part of an ongoing business transformation process aimed at improving the quality of Nortel’s supply chain operations through efficiencies of scale, organization optimization, and process improvements. As part of the establishment of the new Center of Excellence, the Shanghai workforce of highly-skilled procurement professionals is set to quadruple.

The new Shanghai Center of Excellence will be substantially upgraded to provide a full suite of services including strategic procurement, supply chain operations and order fulfillment capabilities. Investment in supply chain, technical engineering, planning and logistical expertise will provide capabilities to further develop Nortel’s strategic and emerging suppliers in China. Nortel’s procurement investment in China passes the US$1 billion mark annually in 2007. Other Centers of Excellence have recently been announced by Nortel in Mexico and in Turkey. The Shanghai Center of Excellence addresses the unique needs of suppliers and customers across Asia as the Company leverages its enhanced supplier base in Asia. The Center is expected to officially launch in the second half of 2007.

“Asia - and China in particular - is fundamental to the transformation of our supply chain activities as we continue to drive for cost-competitiveness and value for our customers across the globe,” said Joel Hackney, senior vice president, Global Operations and Quality, Nortel. “China’s cost-competitive environment provides the ideal climate for increased investment in procurement; the Shanghai Center of Excellence will provide essential technical and operation support where it is required most.”

“China is key to Nortel in Asia - as a strategic market in its own right, as the engine room for our Asia region, and as a global base for our operations, procurement and research and development activities,” said Jackson Wu, president, Greater China, Nortel. “The Shanghai Center further reinforces the company’s commitment to China, coming hot on the heels of the establishment of our state-of-the-art R&D and Executive Briefing Center facility in Beijing in late 2006.”

The announcement of the Shanghai Center of Excellence coincides with Nortel hosting its global supplier forum in Beijing - an annual event held for the first time outside North America. Over 200 emerging suppliers and strategic partners assembled at the Beijing event with members of Nortel’s executive team to discuss multi-million dollar supply deals.

“The focus of the event - cost-competitiveness and quality delivery - made Beijing the logical choice to host this gathering of world suppliers,” said Jeff Townley, Nortel’s incoming chief procurement officer. It was announced prior to the supplier forum that Townley is in the process of relocating to China as he assumes this new role.