Ericsson's deal for Nortel is DOA
It’ll be a few weeks, maybe even months, before every last word is said on the topic of Ericsson’s bid for Nortel’s LTE and CDMA business. But I’ve had an epiphany; the deal isn’t going to happen. For the same reason that ATK / MDA wasn’t approved (see prior post “Prentice is right to reject MDA space deal” April 10-08). No net benefit to Canada; at least not that anyone has seen so far.
After Inco, Falconbridge, Labatt, Molson, Sleeman, ATI, Dofasco, Corel, Cognos, Westcoast Energy, etc., etc., the nation has had enough. Some of these firms matter to the country’s economic future, while others did not. We’re all for a free market, and we’ve lived and died by the sword of Free Trade for the past 20 years. But strategic assets are just that.
Whether the resources be IP or beneath the soil. They’re worth thinking carefully about; ’cause once they’re gone, they’re gone.
I think Nortel’s crown jewels matter. As Minister Clement is learning on the Stelco file, it’s very hard to unscramble the egg once control and ownership have left domestic hands.
In the case of Nortel’s CDMA and LTE intellectual property; let’s not tempt fate.
MRM
you’re arguing *for* protectionism???
Jonas
Not quite.
But let’s not be stupid when the rest of the world gets it.
MRM
And then what, the Government will run Nortel or let Zafirovski to stay on? What about the creditors?
Most stupid suggestion I’ve heard lately.
DickLeo
Not what I’m saying at all.
If RIM will pay at least as much as Ericsson (and close the acquisition), then the Minister should consider using his powers under the Investment Canada Act to ensure that Canada’s best interests are met.
MRM
RIM is not interested in running CDMA business. Their primary interests are in LTE patents and R&D staff. RIM offered $1.1B but wanted the LTE patents as well. With a perfect hindsight, they would have gotten the LTE patents for free.
I honestly believe that to maximize the value of Nortel assets, the company has to be partitioned into smallest pieces possible.
The IP property will be auctioned separately and RIM will have a chance to bid on it.
Canadian Government? Which Government?
Ontario Government?
Current Governments or previous?
These Governments are part of the problem and nobody should expect that they will find solution for Nortel.
You mentioned Corel. Canada did not help that company, Governments were buying from Microsoft not from Corel.
Look at Alcatel, what happened when they got Lucent.
Nortel’s problems are very big, gravy. I hope E// will survive this acquisition.
Gary Kunis, ex CTO stated that accounting issues at Nortel are still questionable. Why Canadian Governments on all levels did not try to expose that? It would help clear the air and expose reasons of Nortels problems. You cannot fix a problem if you don’t know the reason. sha sha and Nortel is sinking to the bottom of the ocean with all on board. Oh, not all
BoD and managers will get their lifeboats or golden parachutes…
who remembers shareholders who paid $300 bill for NT in 2000?
Isn’t it the biggest shareholders’ loss ever?
Will they get anything from investing in NT?