Research in Motion blocked from Nortel wireless bid
By Gabriel Madway
SAN FRANCISCO (Reuters) - Research In Motion Ltd said on Monday Nortel Networks had effectively blocked the BlackBerry maker from bidding potentially $1.1 billion for the bankrupt Canadian company's wireless business.
Analysts said the smartphone maker, which vies with Apple's iPhone and Palm's Pre in the booming market, was zeroing in on Nortel's library of wireless patents at a bargain price.
RIM said it wanted to be qualified as a bidder in Nortel's auction of its CDMA and LTE wireless technology businesses, set for July 24, but was told it would qualify only if it pledged not to submit offers for other Nortel assets for a year.
RIM said it had been prepared to pay roughly $1.1 billion for the wireless business, based on a preliminary review. That would easily trump the $650 million stalking horse deal with Nokia Siemens Networks announced last month.
The smartphone maker's surprise statement comes as Nortel, once one of the world's largest technology companies and a Canadian icon, tries to hive off parts of its businesses after failing to turn itself around.
Nortel, in an emailed statement, said it diligently attempted to work with RIM on acceptable confidentiality terms relating to Nortel's intellectual property assets, but "RIM refused to comply with the court approved procedures."
Nortel added it "continues to be willing to provide RIM with the opportunity to participate in the auction," but said even without RIM's participation, it "believes that an active auction will result in maximizing the value of Nortel's assets."
Also on Monday, Nortel said it had struck a deal to sell its enterprise unit, which builds networks for corporations, to Silver Lake- and TPG Capital-owned Avaya for $475 million. Continued...