Friday, July 01, 2011

Great day for Nortel

Not for everybody though:
Nortel Networks Corp. has auctioned off its remaining patents to a "rock star" group of technology companies in the biggest patent sale in history, ending a massive selloff that generated US$7.7 billion for the insolvent former Canadian technology giant. A consortium that includes leading smartphone makers Apple and Research In Motion Ltd. (TSX:RIM) and computer giant Microsoft will pay US$4.5 billion in cash for about 6,000 patents and patent applications belonging to Nortel.
"Had Nortel’s management realized they had been sitting on the goldmine of patents, the Nortel bankruptcy could have been averted through patent monetization."
The sale of the last of Nortel's technology assets is expected to be completed in the third quarter and is subject to approvals from Canadian and U.S. bankruptcy courts in a joint July 11 hearing.
"The size and dollar value for this transaction is unprecedented, as was the significant interest in the portfolio among major companies around the world," George Riedel, Nortel's chief strategy officer, said in a release at midnight announcing the patent sale.

Nortel had previously announced it did not expect its shareholders to receive any value from its creditor protection proceedings.
The kicker:
Some 400 former Nortel employees found themselves abruptly cut off from their long-term disability benefits this year, as part of a court-approved pension settlement between Nortel and its former employees.
Wonder if there is any way that the July 11 hearing will see an application to alleviate that latter disgraceful situation that looks even worse given today's news.