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MatlinPatterson offers $725m for Nortel’s wireless unit

Auction could heat up with more bids

By CBR Staff Writer

MatlinPatterson Global Advisers, a New York-based private-equity firm has offered a proposal to acquire substantially all of the Nortel’s CDMA and LTE Access assets for $725m. It has made the offer through MPAM Wireless, an affiliate of MatlinPatterson Global Opportunities Partners III LP.

Matlin Patterson said in a statement that its proposal is better than the bid from Nokia Siemens Networks and would provide a superior outcome for Nortel and all of its stakeholders.

Nortel has sought for bankruptcy protection in January and was in plans to liquidate of all of its businesses. MatlinPatterson has become the single largest bond holder after the telecoms equipment maker filed for bankruptcy protection.

Last month, Nokia Siemens Networks has agreed to acquire Nortel’s wireless unit for $650m, in a move to strengthen its Long Term Evolution (LTE) and expand its market presence in North America.

In an open letter to other Nortel stakeholders, MatlinPatterson said that if it was successful in acquiring the CDMA and LTE Access assets, it will pursue opportunities to acquire other Nortel assets as they come up for sale.

The bidding for Nortel’s wireless unit is becoming intense, as the maker of the BlackBerry smartphones Research in Motion has disclosed that it has been prevented from submitting an offer for the wireless unit. The company stated that it was told it could be qualified only if it promised not to submit offers for other Nortel assets for a period of one year.

RIM said, based on its preliminary review, it would be prepared to pay around $1.1 billion, subject to due diligence and other appropriate ancillary agreements, for the CDMA and Long Term Evolution Access businesses and certain other Nortel assets.

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Reportedly, the bids for Nortel’s wireless unit will be considered in an auction that is set for July 24th.

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