Nortel sells VoIP unit for $282m

Robert Clark
25 Feb 2010

Nortel Networks will sell its VoIP and applications solutions assets to Texas-based Genband in a private sale for $282 million.

In a statement Wednesday, the bankrupt Canadian vendor confirmed Genband as the buyer and said the transaction would not proceed to auction.

It had announced the sale of its carrier VoIP and application solutions (CVAS) business in December for $282 million, or net $182 million in cash.

Genband, an IP and media gateway provider, will acquire virtually all of Nortel’s customer contracts, products and patents, including softswitching, gateways, SIP applications, and TDM products.

The sale is subject to court approvals in the US, Canada and Israel and is expected to close in the second quarter.

Most of the 2,000 CVAS employees would continue employment with Genband, Nortel said.

“Uniting our two businesses will create one of the industry's strongest carrier VoIP players, in terms of market share, customer base and portfolio,” said Samih Elhage, head of the CVAS unit.

The business posted about $800 million in sales last year and has shipped more than 121 million carrier VoIP and multimedia ports.

It is one of the last major business units to be sold off. In earlier deals, Nortel disposed of its enterprise solutions business to Avaya for $900 million and its optical unit to Ciena for $769 million.

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