Nortel Networks Corp. closed the submission process in the auction of its enterprise business Friday with multiple bidders, but only one publicly acknowledging interest in the chunk of Canada's former technology equipment giant.
U.S. company Avaya Inc. submitted a $475-million (U.S.) stalking horse bid back in July and remains the only firm that has made a public comment about their offer.
Nortel spokesman Jay Barta confirmed that other bidders joined the auction before the Friday noon ET deadline, but would not disclose their identities.
“We have received additional bids, but I can't tell you how many, and I can't go into any details on them,” he said in a telephone interview.
The auction kicks off at the offices of Nortel's lawyers in Manhattan next Friday.
Nortel has left it up to the bidders to publicly confirm their participation in the auctions, which allows players to opt for a low profile.
The silence from most bidders is a contrast to the public fight waged for Nortel's wireless business, when Research in Motion Ltd. RIM-T lashed out against Nortel over the bidding process and then went to Ottawa to try and quash Telefon AB LM EricssonEricsson ERIC-Q 's winning $1.13-billion.
RIM said Nortel's assets should be kept within the hands of Canadians.
“It may be that [the bidders] are concerned about the thing careening into a dispute,” suggested Eamon Hoey, a business strategist at Hoey Associates Management Consultants Inc.
“Who wants to have the bidding process reviewed by the Canadian government... then have to win before the court of public opinion in Canada?”
The enterprise division made $2.4-billion in revenues in 2008, while the wireless division made nearly double that amount in the same period.
Duncan Stewart, director of research and analysis at DSam Consulting, suggested that means Nortel is unlikely to fetch as much money for this piece of the company.
“This is a smaller division, and the dollar amount is unlikely to be as high [as the wireless sale]. There are fewer possible players,” he said.
“From those perspectives this was almost universally anticipated to be a slightly less interesting auction.”
However, that hasn't stopped the rumour mill from churning out the names of potential bidders.
A holding company owned by American-German joint venture Siemens Gore is expected to participate in the auction, though the company refused to confirm whether they're interested.
Another likely bidder is private equity firm MatlinPatterson, a major Nortel bondholder that wants to buy pieces of Nortel and turn them into a reworked version of the company.
While MatlinPatterson publicly participated in the wireless auction last time, a spokeswoman for the company declined to confirm whether they'll be part of the enterprise auction. She also refused to discuss why the company has decided on a more secretive approach.
Mr. Stewart said there's one simple explanation for why most potential buyers have kept quiet this time around.
“There's really not much to be gained by making a public bid,” he said.
