In the heat of the dot-com boom, Nortel spent billions in questionable acquisitions. But the heady days of the late 1990s tech bubble were short-lived. When the burst came, the company hobbled along until the early days of 2009, when it filed for bankruptcy protection.
But in the ashes of Nortel's monumental collapse, there were deals to be had: big deals; billion-dollar deals. One by one, Nortel's fabled business units were auctioned off, along with their intellectual property, to gleeful rivals at once-unthinkable prices. And lawyers at top-ranked firms in New York and Toronto cashed in on each billable hour. In a drawn-out court session in Toronto last Thursday, a lawyer representing Nortel's British pensioners mocked Nortel's high-powered lawyers for trying to bat away their $3.4-billion claim. But the judge saw through his rhetoric.
Nortel files for bankruptcy protection
Price: 127-years of telecommunications history
Details: It was not immediately clear, beneath the haze of disappointment and national hand-wringing, that Nortel's collapse would result in a fire sale of assets. What was clear was that the bursting of the tech bubble and the recent financial crisis had brought this telecommunications company crashing to its knees.
Nortel announces liquidation
Details: Instead of restructuring the company under court-protected bankruptcy proceedings, CEO Mike Zafirovski decided to throw in the towel. Actually, he had decided to throw it in much earlier, since his announcement was accompanied by an early bid for Nortel's wireless assets by Nokia Siemens Networks.
Ericsson wins wireless assets
Details: Nortel's wireless technology was the company's crown jewels; that is reflected in the hefty price tag. Nortel wanted the sale, but politicians crowed that partly taxpayer-funded technology was slipping to foreign rivals, and Research In Motion Ltd., which maintained Nortel had shut it out of the bidding process, was also furious. But the Swedish telecom equipment maker eventually got what it wanted: multiple billions of dollars in Nortel R&D.
Avaya Inc. wins Enterprise unit
Price: $900-million, plus $15-million employee retention
Details: New Jersey-based Avaya emerged successful after a weekend of intense bidding for Nortel's prized enterprise solutions business. Nortel's global enterprise business hauled in $2.4-billion in revenue in 2008, building and selling telephone and data services to 80 of the Fortune 100 companies, according to the Yankee Group.
Hitachi Ltd. buys some software and technology
Details: In this comparatively small deal, the Japanese company acquired some of Nortel's next-generation packet core network assets, as well as licences for some patents. These mainly deal with the transfer of data over existing wireless networks, but are also related to next-generation wireless technology.
Ciena Corp. wins Metro Ethernet Networks unit
Price: $769-million in cash and notes
Details: Ciena got what was, essentially, the last big chunk of Nortel: its optical networking and the carrier ethernet business. The deal doubled Ciena's turnover and head count. Market jitters over the looming integration process sent the company's stock into a spiral. But the long-term prospects are good. Video and other high-bandwidth information are straining networks. Nortel's high-tech optical technology, and intellectual property in this area, will help alleviate that strain - and boost Ciena's bottom line.
Nortel sells GSM business
Details: The joint sale, to an Ericsson division and Kapsch CarrierCom AG, involves non-exclusive access to patents and technology related to the GSM, or Global System Mobile, cellular network standard. This standard is ubiquitous around the world but still battles with Code Division Multiple Access technology in North America.
Nortel begins to mull selling its patents
Price: Upwards of $1-billion
Details: Nortel announces that it is "exploring strategic alternatives to maximize the value" of nearly 4,000 patent families. The real wealth of Nortel, as most know, was not in its specific commercial business units, but in its R&D. Originally, the plan had been to keep Nortel as an entity that would continue to exist on revenue from patent leasing. Valuations are hard to make, since the assets are so immaterial, but range from a few hundred million up to around $1-billion.
Sells VoIP assets to Genband
Details: With no other bidders, the clearance sale of its carrier voice over Internet protocol and application solutions unit, must have been hard to take. While other units went at almost double their estimated market worth - figures already-shrunken by Nortel's difficult position - this unit sold at five times less than predicted, to a small private company in Texas. An ignoble end, perhaps, to technology likely crucial to the future of telephony.