Should other units fetch comparable prices, the entire company, which once boasted a market value north of $300 billion, would go for as little as $2 billion. Analysts say that’s too little, in spite of the financial straits that forced Nortel to seek bankruptcy protection from creditors in January.
Creditor MatlinPatterson Global Advisors is weighing a plan that might end the cringing. The investor has held talks with Nortel aimed at purchasing the entire company, BusinessWeek.com has learned. MatlinPatterson’s interest in Nortel, reported earlier by the Financial Times, could result in a welcome alternative to selling the company in pieces. Concern that Nortel’s businesses would be sold for too little gathered steam on June 19 with the announcement of the Nokia Siemens deal, which valued the wireless businesses at about one-third of their annual sales.
Chinese Among Potential Buyers?
Nokia Siemens was getting several Nortel wireless equipment businesses on the cheap, some analysts reasoned. And that might presage other fire-sale agreements,Paul Smith Shoes, giving Nortel debt holders an even smaller return than they had hoped for.
MatlinPatterson Global Advisors didn’t respond to a request for comment. Nortel spokesman Mohammed Nakhooda declined to comment.