Under the deal — with a big “BUT” –  [...]]]>

The walking corpse of Nortel has entered into a “stalking horse” asset sale agreement with GENBAND for most of Nortel’s Carrier VoIP and Application Solutions (CVAS) business. It’s a deal that’s almost as interesting as last year’s “purchase” of Sylantro by BroadSoft. (translation = VERY).

Under the deal — with a big “BUT” –  GENBAND would shell out around $282 million in cash with help from One Equity Partners  to buy “substantially all” of the assets of Nortel’s North American, Caribbean/Latin America (CALA) and Asian (CVAS) businesses, as well as “substantially all” of the European, Middle Eastern and African (EMEA) portion of its CVAS businesses — I’m not sure what areas of the world this doesn’t include, since I don’t think there’s a Nortel NP/SP (North Pole/South Pole) division.   There’s also about $100 million in balance sheet “and other” adjustments bouncing around in the offer.

Assets GENBAND would get include Nortel’s softswitching, gateways and SIP applications, plus all patents and IP (intellectual property). According to Nortel and reported by ChannelWeb, it has shipped more than 118 million carrier VoIP and multimedia ports  including 10 million SIP ports to both wireless and wireline carriers all over the world, and it gained about 40 new carrier VoIP customers this year alone.

The big “BUT” is that this is a stalking-horse arrangement, so other companies can choose to place their own (higher) bids when the assets go up for auction in early January.

If you’re looking for the palace intrigue/things-that-make-you-go-hmm here, GENBAND was on a roll of rollups up until the credit markets got cold in the fall of 2008, with its last acquisition being a (rumored) all-stock deal for NextPoint back in September 2008.  NextPoint, the product of a merger engineered by One Equity Partners, had the number #2 share of the SBC (Session Border Controller) market back then with 14 percent — Acme Packet.

The major player in that deal was One Equity Partners, who backed the “parents” of  NextTone and and ReefPoint into the merger of NextPoint.  Exactly how much GENBAND stock was shelled out for NextPoint is unclear, but “substantial dilution” seems to be a phrase bandied about by some observers.

Now One Equity is backing GENBAND’s  “Stalking Horse” bid for Nortel’s assets. Be interesting to see what happens when real money and other players jump into the bidding process.

Regional CLEC Cavalier (www.cavtel.com), split-personality SureWest Communications (Northern California [...]]]>

A quick review of Metaswitch’s latest news over the past six weeks reveals that the company is racking up a lot of wins among the larger Tier 2/Tier 3 CLECs and MSOs.  And, oh by the way, has been increasing revenue at a steady pace.

Regional CLEC Cavalier (www.cavtel.com), split-personality SureWest Communications (Northern California and Kansas City), and mid-Atlantic MSO/fiber carrier RCN Communications are among the bigger names who have made recent MetaSwitch/MetaSphere announcements.  Both SureWest and RCN are big IP/fiber shops, offering a combination of business and consumer services, including voice, video, and data.

Announcing its annual results last month for its fiscal year closing on August 31, MetaSwitch announced that its overall revenue grew 4.2 percent to $113.7 million, with operating margins “sustained” above 20 percent.

Hello! MetaSwitch recorded revenue growth in a year from hell, hello!

Business came from Tier one incumbent operators and major regional providers as smaller guys slowed down between concerns over market conditions and when they’d get their hands on federal broadband stimulus pork, er funds.  MetaSwitch says 8 of the Top 10 incumbent operators in North America rely on its products for carrier VoIP infrastructure while independent analysts report the cmpany moved into the lead positon of the Class 5 segment of the global carrier VoIP market.

With Nortel in continued bankruptcy chaos, MetaSwitch is likely to see further gains over the next year. Sure, Nortel is announcing new products, but new customer growth? Mmm…

Nokia Siemens Networks, Research in Motion, Ericsson, and MatlinPatterson have all made offers in [...]]]>

Nortel’s CDMA and LTE wireless assets are first up on the block today.  The good news for Nortel is 1) There are multiple bidders and 2) The price tag seems to go up every time someone issues a press release.

Nokia Siemens Networks, Research in Motion, Ericsson, and MatlinPatterson have all made offers in some form. NSN put out a “stalking horse” of $650 million and suggested it might raise the offer. RIM got turned away despite offering $1.1 billion, which is now causing some consternation in Canadian government circles since purchase by Sugar Daddy BlackBerry would have kept Nortel assets and jobs all-Canadian.  Ericsson has offered up $730 million, just beating MatlinPatterson’s $725 million bid.

It will be interesting to see with who ends up with what when the smoke clears.  And RIM’s political posturing is likely to further complicate the process of any winning bid.

In a press release today, Avaya announced it has signed agreements to pick up Nortel’s enterprise solution business for $475 [...]]]>

Avaya and Aastra have made separate moves to get into the Nortel bankruptcy circus.  Avaya is offering cash for assets, while Aastra will offer migration incentives (i.e. a sale) to get customers to switch.

In a press release today, Avaya announced it has signed agreements to pick up Nortel’s enterprise solution business for $475 million.  The acquisition includes Nortel’s Enterprise Solutions voice, data and government systems businesses, but the transaction awaits clearing a competitive bidding process and approval by bankruptcy courts in Delaware and Ontario.

Avaya gets to scale a bit, expand its channel partner network, and add to its portfolio of products and services.   Nortel gets cash to pay off its creditors and some of its employees will land as Avaya employees.  Bell Canada and BT praised the move and BT went so far as to say it would “expand” its engagement with Avaya over the next year to offer a full unified communications portfolio.

Aastra’s move is less concrete, more ambulance-chasing.  For “a limited time” Aastra says it will offer “extraordinary incentives” to get Nortel large enterprise customers to move to its Clearspan UC solution. Discounts include free unlimited numbers of SIP integration trunks, “significant” discounts on Aastra 67ix SIP phones, free instructor-lead training for admins during the first year of deployment (up to 2 students per class) and free end user, web-based training for an unlimited number of users during the first two years of deployment.

Aastra says that a 3,000 user enterprise deploying 300 SIP integration trunks and 1500 new SIP phones to users can save $500,000.

Billy Mays, you passed too soon, my friend.  You could have made some serious coin off someone looking to rob Nortel of its customer base…

LOCOG cited the pending dissolution of Nortel in bankruptcy court as the primary [...]]]>

Lost in the chaos last week, the London Organising Committee of the Olympic Games and Paralympic Games (LOCOG) uncerimonously dumped Nortel as its “Official Network Infrastructure Partner” for the London 2012 Olympic and Paralympic Games.  Never fear, Cisco is here!

LOCOG cited the pending dissolution of Nortel in bankruptcy court as the primary reason; the company diminished value as its pieces disappear, so LOCOG and Nortel “amicably” (i.e. polietly) decided to end the agreement.

Needless to say, Cisco was waiting in the wings and was more than happy to throw in a bid for the infrastructure contract and became the new Official Network Infrastructure Supporter for London 2012 in a tier two deal starting immediately.

For now, Nortel continues in the driver’s seat for the Vancouver 2010 Winter Games, but it remains to be seen if said event will be Nortel’s  last call before its pieces and brand are scattered to the winds.

A Nortel event last week was supposed to be a discussion on [...]]]>

Last week, Nortel was too busy pimping its own assets rather than talking about the future of the company, reports Wireless Week. With July 21 looming as the final date to bid on Nortel assets, a little panic may be setting in.

A Nortel event last week was supposed to be a discussion on the “realities of the current CDMA market,” but after the presentation ABI Research analyst Nadine Manjaro asked if the company had dragged her in for a sales pitch.    Manjaro believes that Nortel is “rushing” to get higher bidder in play.

Currently, the only public bid is a $650 million offer from Nokia Siemens Networks, with “vulture capitalist” firm and Nortel creditor MatlinPatterson also making noises it’s going to make a bid for the whole company.  Nortel officials are playing cute, hinting of other bidders, but if that’s so, why is the company trying to pump the future of its assets?

We’ll all find out more at the end of the month, when the identities of the bidders will become public. At this rate, MetaSwitch might as well throw in a low-ball bid for Nortel’s VoIP assets just to make ‘em sweat.

ShareThis // // // Write a Comment NSN’s Low Bid Causing Strain at Nortel? By Maisie Ramsay WirelessWeek – July 10, 2009 The deadline to bid on Nortel’s assets is less than three weeks away, and it appears the company is starting to sweat a little. Yesterday, Nortel held an hour-long conference that sounded suspiciously like a sales pitch for its CDMA assets. The company’s press invitation for the conference had touted the call as a discussion of the “realities of the current CDMA market” within the context of Nortel’s pending sale of its wireless assets. But the company spent the bulk of the call pointing out just how monetizable its assets were. By the end of it, ABI Research analyst Nadine Manjaro piped up to ask if the company had dragged her there for a sales pitch. Nortel representatives replied, in part, that the call would help build sales momentum for the company that eventually acquires it. Manjaro has a different take: She thinks Nortel is rushing to get higher bidders in before the company goes on the auction block on July 24. “The Nortel call today was to tout Nortel’s true value, which will potentially increase bidders,” she says. “All of the recent press has been more on the negative side so it was an effort to say that even though the company is going through bankruptcy, the assets are still valuable.” So far, the only public bid has been a paltry $650 million from Nokia Siemens Networks. Nortel creditor MatlinPatterson also has said it will bid on the company, but it has yet to submit a proposal. Despite the conference call’s note of desperation, Nortel’s wireless marketing vice president Bruce Gustafson hinted to Wireless Week that there were more offers in the wings. “If you’re assuming there are no additional bids because there’s no public disclosure, you’d be mistaken,” he said, declining to name other bidders. The industry may have to wait until the end of the month to see if Nortel’s last-minute sales pitch was effective. On July 21, all bids for the company have to be submitted and the identities of the bidders will become public. Nortel will be at auction three days later, and its new owner will emerge once approval is given by the bankruptcy court. More FirstNews 07/10/09: •  NSN’s Low Bid Causing Strain at Nortel? •  King of Pop Drives Mobile TV Views •  CTIA Filing Highlights Growth, Need for More Sites •  Spectrum Inventory Bill Progresses •  Week in Review … July 6-10 •  WW Named the Official Print Show Daily for CTIA IT & E •  Google CEO: New Operating System Changes the Game •  FirstNews Briefs for July 10, 2009 Printer Friendly Version | E-mail to a Colleague Please enter a to e-mail address. Please enter a valid to e-mail address. Please enter a from e-mail address. Please enter a valid from e-mail address. 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