Ciena Beats Nokia-Siemens to Nortel Unit
Ciena Corp was cleared to acquire a unit of bankrupt Nortel Networks Inc. for $769 million after fighting off a legal challenge by Nokia Siemens Networks, Reuters reported. Network equipment maker Ciena trumped an offer by Nokia Siemens and its financial partner, One Equity Partners, with an auction-winning bid of $530 million in cash and $239 million in convertible securities for Nortel's optical networking and carrier Ethernet business. On Tuesday, the 50-50 joint venture of Nokia of Finland and Siemens of Germany said it was ready to raise its offer to $810 million in cash, if the auction, which ended in late November, was reopened. That set up Wednesday's fight in court, with Nokia Siemens and some creditors arguing the auction should be reopened, in part because Ciena's convertible securities were overvalued. After roughly seven hours of argument, testimony and cross-examination, Nortel's attorney said his team had a reached a deal in the hallway outside the court that would lead to the withdrawal of the last major objection. Ciena's winning bid still has to be approved by judges in Canada and Delaware's bankruptcy court, but the withdrawal of the objections made that a near-certainty later on Wednesday. The hearing was being held simultaneously in U.S. bankruptcy court and a Canadian court. Read more.