Canada won't block $4.5 billion sale of Nortel patents
OTTAWA (Reuters) - The Canadian government will not review the purchase of patents belonging to bankrupt Nortel Networks by a group that includes Apple Inc, Microsoft Corp and Research In Motion Ltd, the industry minister said on Tuesday.
A consortium of these companies and EMC Corp, Ericsson and Sony Corp bid $4.5 billion to buy thousands of Nortel patents in a recent auction.
Under the Investment Canada Act, the government must review foreign investments with a book value of more than C$312 million ($328 million) to determine if they are of "net benefit" to the country.
But while the Nortel patents' sale price clearly exceeds that threshold, the book value may be far lower. Industry Minister Christian Paradis said investment review officials had come to the conclusion that the sale was not subject to a net benefit review after examining the applicable rules and threshold values.
"Based on the information provided by the investor and Nortel's 2010 audited financial statements, the acquisition of the Nortel patents is not subject to review for net benefit under the Act," Paradis said in a statement.
The Canadian and U.S. courts overseeing Nortel's bankruptcy proceedings approved the sale of the patents on July 11.
The six-company group outbid Google Inc and other companies for the patents, and the winners could try to maximize their returns by taking competitors to court to seek damages for patent infringement.
(Reporting by Randall Palmer and Louise Egan; editing by Peter Galloway)
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