Do I hear 500? ... Do I hear 600? .... Nortel sold for $900 million

After a long week-end of sleepless nights, hurried hotel arrangements, and slow court proceedings, Nortel has the court’s blessing to sell their Enterprise and Government Systems Groups as well as DiamondWare assets) to Avaya for $900 million plus a $15 million fund for retention of key employees.  Nortel’s Enterprise Solutions group posted latest quarter revenue of $464 million  -but even with corporate gross margins near the 40% range, Nortel overall posted a loss for the quarter.  Avaya assumes negligible liabilities from debt and none from pensions.  The deal is expected to be accretive to earnings well within 24 months.  Business leaders (and accountants) must find a way to make the Enterprise assets profitable in the short term.   

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