Nortel is coming to the table for yet another bankruptcy protection handout. Less than a week after the IRS slapped it with a $3 billion tax bill, Nortel has asked to extend the time when claims can be filed to February 2010 and the time when debtors can solicit acceptances until April 2, 2010. A company statement said that the extension it filed with Epiq will provide it the necessary time to "file a plan of reorganization and solicit support for such a plan..."
A Seeking Alpha article suggests that the reason Nortel is asking for this extra time is so it can complete the garage sale of its existing assets. This so-called garage sale has been in full swing with Nortel selling off its LTE/CDMA assets to Ericsson, while Avaya made a $475 million bid for the company's Enterprise Solutions division in July.
Such a theory that Nortel needs the extra time to sell more of its units is not completely off base. Reports have emerged that there are a number of potential interested bidders for Nortel's profitable Metro Ethernet Networks (MEN) and its carrier VoIP units. Canada's Financial Post reported last month that the company is examining offers for its VoIP business. Jilted at the altar for Nortel's CDMA/LTE assets, Nokia Siemens Networks (NSN) could be a potential bidder for the VoIP business, while one analyst believes that Sonus will be the more likely candidate. Then, there's the MEN business, which has attracted other potential suitors such as Ciena, Ericsson and NSN.
- here's the Seeking Alpha article
IRS sends Nortel a $3B tax bill
The Great White Mess: Nortel staggers to the finish line
Will Sonus get Nortel's VoIP assets?
Ericsson wins Nortel wireless assets for $1.1B
Avaya bids $475M for Nortel Enterprise Solutions