Google and Nortel have agreed at the princely sum of $900 million to begin off a “stalking horse” auction — wherein outside parties are still free to outdo Google’s bid — for the purchase of Nortel’s rather vast patent portfolio. The sale comes as portion of the latter company’s bankruptcy selloff and involves some 6,000 patents and patent applications, which encompass both wired and wireless communications, semiconductors, data networking, voice, and the web — going as far as to even touch on web search and social networking. The item is, Google’s not likely enamored with these tidbits of intellectual property to the tune of nearly one billion dollars. No sir, a slightly bitter blog post from the corporate this morning makes it quite clear that Google’s acting as a way to bolster its own intellectual property library and to “create a disincentive for others to sue .” Both Android and Chrome get obliquely mentioned in Google’s announcement as cashing in on the move, which needs to be completed by June of this year pending other bids and regulatory approvals.
Apr 04, 2011 10:53 ETNortel to Sell Patent Portfolio
- Enters into Stalking Horse Sale Agreement with Google Inc. for US$900 million in cash
- Planned sale includes approximately 6,000 patents and patent applications covering a broad range of wired, wireless and digital communication technologies
- Subject to Canadian and U.S. court approvals, auction expected in June 2011TORONTO, ONTARIO–(Marketwire – April 4, 2011) – Nortel(1) Networks Corporation (OTCBB:NRTLQ) announced today that it, its principal operating subsidiary Nortel Networks Limited (NNL) and sure of its other subsidiaries, including Nortel Networks Inc. and Nortel Networks UK Limited (in administration), have entered right into a stalking horse asset sale agreement with Google Inc. for the sale of all of Nortel’s remaining patents and patent applications for a cash purchase price of US$900 million.
The agreement includes the planned sale of roughly 6,000 patents and patent applications spanning wireless, wireless 4G, data networking, optical, voice, internet, employer, semiconductors and other patent portfolios. The extensive patent portfolio touches nearly every aspect of telecommunications and extra markets in addition, including Internet search and social networking.
This agreement follows a confidential, multi-round bidding process involving several interested companies and consortia from everywhere.
“It is an unprecedented opportunity to obtain one of the vital extensive and compelling patent portfolios to ever come available on the market”, said George Riedel, Chief Strategy Officer and President of economic Units, Nortel. “We glance forward to what we are hoping will probably be a powerful auction, following the requisite court approvals, currently expected to be held in June 2011″.
Details of Sale Process
Nortel will file the stalking horse asset sale agreement with the us Bankruptcy Court for the District of Delaware in addition to a motion seeking the establishment of bidding procedures for an auction that permits other qualified bidders to submit higher or otherwise better offers, as required under Section 363 of the U.S. Bankruptcy Code. the same motion for the approval of the bidding procedures should be filed with the Ontario Superior Court of Justice. Following completion of the bidding process, final approval of the U.S. and Canadian courts will likely be required.
As well as the processes and approvals outlined above, consummation of the transaction is subject to the satisfaction of regulatory and other customary conditions.
As previously announced, Nortel would not expect that the corporate’s common shareholders or the NNL preferred shareholders will receive any value from the creditor protection proceedings and expects that the proceedings will bring about the cancellation of those equity interests.
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