Court approves auction for Nortel carrier business
NEW YORK (Reuters) - A U.S. bankruptcy judge on Monday approved procedures for Nortel Networks Inc NTL_pf.TO to put most of its network carrier business up for auction in July.
U.S. Bankruptcy Judge Kevin Gross approved the bidding procedures for the July auction at a court hearing in Wilmington, Delaware on Monday, according to court documents.
Nortel has said Nokia Siemens Networks NOKI.UL -- a joint venture of Nokia (NOK1V.HE) and Siemens (SIEGn.DE) -- will offer $650 million for the company and act as the "stalking horse bidder" for the advanced wireless technology business which helps service providers and cable operators supply voice, data and multimedia communications to mobile devices.
In a bankruptcy auction a "stalking horse" typically sets the floor for bidding, and makes the lead bid at the bankruptcy auction. Nokia Siemens will have the right to match any higher offers.
The deal would allow Nokia Siemens to expand its presence in North America and make it a leading supplier of wireless infrastructure products in the region.
Nortel has said in court papers that its network carrier business competes with companies like Ericsson (ERIAF.PK), Alcatel-Lucent (ALUA.PA), and Motorola Inc (MOT.N).
The auction is set for July 24 in New York and the deadline to submit bids is July 21. The deal is subject to bankruptcy court approval and a court hearing is set for July 28, according to court documents.
Thee case is In re: Nortel Networks Inc, U.S. Bankruptcy Court, District of Delaware, No. 09-10138.
(Reporting by Emily Chasan)
