Nortel Networks in Sale of Wireless Unit to Ericsson Through Bankruptcy Auction
July 28, 2009
Cleary Gottlieb is representing Nortel Networks on the sale of its wireless infrastructure assets through a bankruptcy auction to Telefonaktiebolaget LM Ericsson for $1.13 billion, an increase of almost $500 million from Nokia Siemens’ original stalking horse bid for these assets. The sale followed a twelve-hour auction that took place in Cleary Gottlieb’s New York office on July 24. It was approved on July 28 after a joint hearing held simultaneously before courts in the United States and Canada.
Nortel has been a client of Cleary Gottlieb for more than 20 years. The firm is currently acting as U.S. bankruptcy counsel to Nortel and affiliates in their U.S. Chapter 11 proceedings, which are closely coordinated with proceedings in Canada, the United Kingdom and France. The firm is also representing Nortel on a stalking horse sale agreement with Avaya for the purchase of Nortel’s global Enterprise Solutions business, including units in North America, the Caribbean, Latin America, Asia, Europe, the Middle East and Africa. This sale is also subject to an auction process and court approval.
In recent years, the firm has represented Nortel in a number of financing and M&A transactions, including the sale of assets related to Nortel’s UMTS access business to Alcatel-Lucent. The firm also advised Nortel on European aspects of its sale to Flextronics of manufacturing operations and related activities in Canada, Brazil, France and Northern Ireland.