Nortel UK, and most of the comms giant's European operation, has gone into administration a day after its Canadian parent filed for bankruptcy protection. The company said yesterday that its US and Canadian businesses were seeking Chapter 11 bankruptcy protection. The UK firm will be overseen by overseen by Ernst and Young. A …
Is this all of Nortel
Does this cover LG-Nortel as well?
The Times today points out that Nortel is/was one of the largest corporate sponsors of the London Olympics, to the tune of £58 million cash (IIRC) plus other "in kind" support (telecoms kit).
I think we are all resigned to the fact that the 2012 Olympics are going to be a huge embarrassment. Losing one sponsor is not going to make it any more pants than it's going to be anyway.
Canada has no "Chapter 11"
"The company said yesterday that its US and Canadian businesses were seeking Chapter 11 bankruptcy protection."
Not to put too fine a point on it, but "Chapter 11" is purely an instrument of the USA. Canadian bankruptcy applies quite a different process. Having never been bankrupt in either of those sovereign nations I can't clearly describe those differences. But I do know they are different.
Nortel are an 'Official Partner' so Vancouver will suffer too.
Corporate finance is too much smoke and mirrors. Nortel somehow kept hold of cash and held their debts, but are very much in 'negative equity' and have been for some quarters.
To claim to have $2.4 Billion in cash, then run for bancruptcy protection when a $107Million bill is due does not ring true. No-one with $24 grand in the bank would be able to claim they could not pay their $1K mortgage that month.
It's in the shareholders interest to break up the company, and I'm surprised it's not been pushed before. While the company continues to trade, it's merely delaying the inevitable - no-one wants to buy it as a going concern - and eating up shareholders cash. No-one will offer anything for the good bits from the business (perhaps Optical division) until they can pick it off the scrap-heap from the administrators for a song.
As an ex-employee (and pensioner) of Nortel I find it so sad that the company has got into this mess. When I worked for them (we were taken over) there were a predominance of US rather than Canadian senior execs who managed by Powerpoint. I taught for a year their Quality Improvement programme only to find that many (not all) of the guys at the top couldn't care about it - several joined British Gas/AA after leaving Nortel curiously . Great products, some amazingly clever staff - Harlow, the inventors of fibre optics in STC days had more PhDs than Cambridge University it was claimed - but when I worked there the awful management laid the foundations for what the current management has inherited.