Nortel (News - Alert) Networks has announced that it has entered into an agreement to sell a portion of its “Next-Generation Packet Core Network” to Japanese electronics giant Hitachi (News - Alert), Ltd. The agreement, which excludes legacy packet core components for Nortel’s GSM and UMTS businesses, is valued at a $10 million.
Assets in sale, expected to close in 2009, include software to support the transfer of data over existing wireless networks and the next generation of wireless communications technology, including relevant non-patent intellectual property, equipment and other related tangible assets, as well as a non-exclusive license of certain relevant patents and other intellectual property. The sale does not include legacy packet core components for Toronto-based Nortel’s 3G UMTS and GSM businesses.
According to Nortel, consummation of the transaction is subject to approval by the United States Bankruptcy Court for the District of Delaware and the Ontario Superior Court of Justice as well as the satisfaction of regulatory and other customary conditions.
Earlier this month, Nortel received approval for a $521-million “stalking horse” bid by Ciena Corp (News - Alert). for its optical networking business as part of an auction, to be held in early November.
Last month, Nortel announced its “Enterprise Solutions” division would be sold to New Jersey-based Avaya (News - Alert) for $900 million.
As previously announced, Nortel does not expect that the company’s common shareholders or the NNL preferred shareholders will receive any value from the creditor protection proceedings and expects that the proceedings will result in the cancellation of these equity interests.
Marisa Torrieri is a TMCnet Editor. To read more of her articles, please visit her columnist page.
Edited by Marisa Torrieri