Who will become the victor in acquiring Nortel's optical unit continues to be a mystery. A Bloomberg report emerged that the troubled vendor is going to extend yesterday's deadline to make a bid on its optical networking business. According to two people close to Nortel's asset auction, the company has the right to delay the deadline for five business days. This comes after Ciena reached an agreement to acquire the unit in a $515 million stalking-horse bid.
Last week, a rumor emerged that Nokia Siemens Networks (NSN) is crafting an offer to purchase Nortel's optical unit to expand its presence in the North American telecom market. NSN lost its real first chance to enhance its North American presence in wireless when it was beat out by Ericsson for Nortel's CDMA business. According to one of the people that revealed the deadline extension for Nortel's assets, other unnamed vendors are also interested in making a run at Nortel's optical business. However, NSN has not made any formal announcement on whether it will make a bid on the business.
While it is far from a done deal, Ciena did announce that it got regulatory clearance to proceed with its acquisition of Nortel's assets. Even so it still has a number of challenges ahead before any deal could be consummated. In addition to the possibility of being outbid by another vendor rival, Ciena will also need the approval of the U.S. Bankruptcy Court for the District of Delaware and the Ontario Superior Court of Justice in addition to other necessary regulatory clearances.
- Bloomberg has this article
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