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Ericsson one step closer to buying Nortel assets

Ericsson's $1.1bn bid to buy the core wireless assets of Canada's Nortel Networks has been given the go-ahead by bankruptcy courts in the US and Canada.

Nortel filed for bankruptcy protection in January in the US and Canada to give the company the opportunity to deal with costs, debts and restructuring.

The court approval means the break-up of Nortel can go ahead, unless the sale is opposed by the Canadian government.

Rejected Canadian bidder Research in Motion and the Ontario government have called on the federal government to block the sale.

The acquisition will see some of Canada's most prized technology assets fall under foreign control.

Canada's industry minister Tony Clement has indicated the government is considering the options, according to the Financial Times.

The Canadian government could use foreign investment laws that make any deal valued at more than $288m subject to state approval.

Sweden's Ericsson outbid Nokia Siemens and MatlinPatterson over nearly 12 hours in an auction in New York on Friday for Nortel's profitable CDMA wireless business and its next-generation LTE operations.

Analysts said the deal will significantly expand Ericsson's footprint in North America, mark its return to the CDMA business and consolidate its position as a telecoms equipment supplier.


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