Nortel Networks Corp., which is operating under court protection from creditors, announced a deal Friday to sell most of its wireless business for $650 million US and said it’s in advanced talks to sell the rest of its operations, winding down a company with a 127 year old history in Canada.
Nortel president and chief executive Mike Zafirovski said an orderly sale of the Toronto telecom equipment maker is the best way to preserve value.
“We really believe the best outcome for that is selling our businesses to drive consolidation in the industry,” Zafirovski said in an interview late Friday.
“We believe that the best outcome to optimize value and to preserve the other very significant assets is an orderly sale of our businesses.”
Zafirovski, who said earlier this year he wanted to restructure and preserve Nortel as a stand-alone company, said it’s already in advanced talks for the sale of the other parts of the business.
“We will be weeks and months, not quarters,” Zafirovski said.
Nortel also said it will ask to have its shares delisted from the Toronto Stock Exchange, the market where Nortel once accounted for more than a third of the value of all the companies listed.
When the company filed for protection under Chapter 11 of the U.S. bankruptcy law and the Companies’ Creditor Arrangement Act in Canada, it said it planned to restructure as a more focused company.
Nortel’s predecessors have been in business since 1882, growing from making telephones for its former Bell Canada parent to the network technology through aggressive —- but ill-fated acquisitions — in the United States.
However Nortel has faced a variety of troubles since the tech bubble burst — including accounting problems that devastated its stock and led to criminal charges against former executives.