Avaya wins auction for Nortel but it cost much more
Written by live.phone on September 14th, 2009With an American economy in bad shape many companies are consolidating. Others are for sale, such as Skype. While the Skype deal allows eBay to retain part ownership, Nortel is a different story.
Avaya Inc. has won the auction to acquire Nortel Networks (NYSE: NT)’ Enterprise Solutions unit and some associated operations, but the firm had to boost its bid from $475 million to $900 to capture the Nortel assets.
Avaya staved off a last minute offer from Siemens Enterprise Communication and its private equity partner, Gores Group LLC. The enterprise unit provides landline phone systems to customers on a worldwide basis. In July, Avaya had submitted a $475 million stalking horse offer for the assets and last week that bid was challenged by an undisclosed suitor, which turned out to be the Siemens-Gores offer. The enterprise operation recorded revenues of $2.4 billion in 2008.
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