Nortel gets court nod to sell internet telephony business to Genband

Nortel Networks Corporation (Nortel), once North America's largest telecom equipment maker announced yesterday that the company has got approvals from the US and Canadian bankruptcy courts to sell its internet telephony business to Genband Inc, a closely-held equipment vendor for approximately $282 million.

Nortel said in a statement that at a joint hearing yesterday, its principal operating subsidiary Nortel Networks Limited, and certain of its other subsidiaries, including Nortel Networks Inc obtained orders from the US bankruptcy court for the district of Delaware and the Ontario superior court of justice approving the asset sale agreement with Genband.

The deal covers most of the global assets of Nortel's Carrier VoIP and Application Solutions (CVAS) business.

Under the terms of the deal, Genband will pay a total price of $282 million, subject to balance sheet and other adjustments currently estimated at approximately $100 million for a net purchase price of around $182 million.

Nortel's certain other subsidiaries, including Nortel Networks UK Limited, have entered into a separate agreement with Genband for the company's European, Middle East and African CVAS businesses.

The sale is expected to close in the second quarter of 2010, subject to required regulatory approvals and customary closing conditions.