(In U.S. dollars)
TORONTO (Reuters) - Nortel Networks Corp
is selling its global multi-service switch business to Marlin
Equity Partners and Samnite Technologies Inc for $39 million in
cash, the company said Friday.
Nortel, once North America's biggest telecommunications
equipment maker, said it entered into a "stalking horse" asset
sale of its North America, Caribbean and Latin America and Asia
multi-service switch business, or MSS, with PSP Holding, a
special purpose entity backed by Marlin and Samnite.
Nortel is also selling its Europe, Middle East and Africa
MSS business to PSP.
A "stalking horse" bid is used when a bankrupt company
chooses an interested firm to set the bar so that other bidders
can't low-ball a purchase price.
Nortel said the sale includes intellectual property related
to the business, and employees will have the opportunity to
continue working for PSP.
Nortel filed for bankruptcy protection in January 2009 and
has been auctioning off its business in an effort to pay back
The deal was filed with the U.S. Bankruptcy Court for the
District of Delaware along with a motion to establish an
auction that allows other qualified bidders to submit better
offers. A similar motion will be filed with the Ontario
Superior Court of Justice.
($ 1=$1.06 Canadian)
(Reporting by Solarina Ho)