Ciena trumps Nokia Siemens to acquire Nortel's ethernet assets for $769 million
24 November 2009
Canadian networl specialist Ciena Corporation, the network specialist, yesterday announced that the company has been selected as the successful bidder for the acquisition of the optical and carrier ethernet businesses of the bankrupt Nortel's Metro Ethernet Networks for $769 million.
Linthicum, Meryland-based Ciena trumped rival Nokia Siemens Networks and One Equity Partners in a three-day court-mandated auction which started on last Friday.
Under the terms, Ciena would pay $530 million in cash, and $239 million in senior convertible notes which will carry 6 per cent interest per annum and will mature in 2017. Prior to maturity, the holders have the option to convert the notes into Ciena common stock at an approximate price of $16.46 per share.
Last month, Ciena submitted a stalking horse bid of $521 million for the ethernet assets. (See: Ciena puts in play Nortel's ethernet assets with $521 million stalking horse bid)
Toronto-based Nortel Networks, once Canada's largest technology company, filed for bankruptcy protection in Canada, the US and Europe in January 2009.
Nortel's Metro Ethernet business has presence in 65 countries with over 1,000 customers including AT&T, Verizon Communications, Comcast Corporation etc. Its revenue for the first three quarters was $988 million, 21 per cent down compared to the same period a year ago.