THE WRAP: NSN-Moto deal back on track

John C. Tanner
15 Apr 2011
00:00
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Daily News

It was the week that saw a breakthrough in the stalled NSN-Motorola deal, while Level 3 bought Global Crossing, and Axiata Group swept the 14th TelecomAsia Awards.

Nokia Siemens’ long-delayed acquisition of Motorola Solutions went back on track this week, but only after the firm cut the purchase price by $225 million to account for the settlement of a Huawei lawsuit against the pair in the US.

The lower $975 million price covers additional costs associated with licensing fees for Huawei IP that was included in Motorola’s assets under previous commercial agreements. NSN expects the deal to finally wrap up before the end of the month, although it still needs a green light from Chinese regulators.

It was also the week that saw Level 3 Communications seal a deal to buy ST Telemedia-controlled Global Crossing for $3 billion, which includes $1.1 billion in debt. ST Telemedia will be the largest shareholder of the combined entity. Shares in both companies surged on the news, GC’s by almost 70%.

Both companies were major casualties of the bandwidth bubble bust ten years ago. Level 3 stayed solvent in part by selling off its Asia assets to Reach [PDF] in December 2001; a month later Global Crossing filed for bankruptcy.

It was also the week that saw telcos in New Zealand blast the proposed legislation behind the nation's Ultrafast Broadband project, stating it will drive up prices and only increase Telecom NZ's market power.

A group of operators, as well as consumer groups including the Telecom Users Association of New Zealand (TUANZ) signed a letter sent to local MPs in protest of the bill to set the terms of the fiber network project.

In other NBN news, Australia’s NBN Co announced the first 12 companies that will provide retail services during mainland trials of the National Broadband Network. The companies include Telstra, Optus, iiNet, SkyMesh, Exetel, AAPT, iPrimus and Internode.

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