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Avaya won the bidding.
- Thread starter dulfo666
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Yea nice. We will see what the regulators do. Interesting on what will happen with the government contracts and all the Verizon contracts 
Best of luck to everyone. I already know Avaya so won't matter to me if they eventually drop Nortel. At least I can't imagine why you would sell a less expensive product when you can make almost double selling the Avaya line
Really, what other GOOD ACD competitor is there - OOOPPS too bad you can't say Cisco! Anyone else?
Best of luck to everyone. I already know Avaya so won't matter to me if they eventually drop Nortel. At least I can't imagine why you would sell a less expensive product when you can make almost double selling the Avaya line
Really, what other GOOD ACD competitor is there - OOOPPS too bad you can't say Cisco! Anyone else?
I wonder if this whole thing will be in court for so long, the products we know today won't even exist by the time the deal is done.
[©] GHTROUT.com [⇔] Resources for Nortel Meridian/CS1000 System Administrators - You Can Hire Me Too
[©] GHTROUT.com [⇔] Resources for Nortel Meridian/CS1000 System Administrators - You Can Hire Me Too
LuckyThirteen
Vendor
From Bloomberg.com........
Avaya Wins Nortel Unit Auction With $915 Million Bid (Update3)
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By Hugo Miller
Sept. 14 (Bloomberg) -- Avaya Inc., the U.S. maker of corporate phone systems, agreed to buy Nortel Networks Corp.’s enterprise-telecommunications unit and other assets, winning an auction for the business with a bid of $915 million.
Avaya will pay $900 million in cash and $15 million for an employee retention program, Toronto-based Nortel said today in a statement. Avaya, based in Basking Ridge, New Jersey, had made an opening, pre-auction bid of $475 million for the unit, which makes phone equipment and networks for companies.
Nortel, which filed for bankruptcy protection in January, is selling off its main businesses after deciding that was a better option for creditors than trying to reorganize the company and keep it intact. Sales at the enterprise unit fell 28 percent to $465 million in the second quarter.
As part of the transaction, Nortel is also selling shares of its government solutions and DiamondWare voice technology businesses. Canadian and U.S. court approvals for the sale will be sought at a joint hearing tomorrow, it said.
Nortel sought protection from creditors after losing $5.8 billion last year amid a slump in demand for its equipment. Ericsson AB, the world’s largest maker of wireless networks, won an auction for Nortel’s wireless unit in July, agreeing to pay $1.13 billion after six rounds of bidding and trumping an opening offer of $650 million from Nokia Siemens Networks.
No Delay Expected
The deal removes “a level of uncertainty and provides a clear path for customers and employees,” Joel Hackney, the unit’s president, said on a conference call today.
He said he expects the acquisition to close this year and doesn’t foresee a related dispute between Avaya and Verizon Communications Inc. delaying the deal or court approval.
Verizon said before the auction it intended to object if Avaya won because Avaya may terminate contracts Verizon considers essential to U.S. national security.
Avaya said in a Sept. 10 court filing that it’s trying to negotiate “suitable arrangements” for assumption of the contracts.
Avaya, which competes against Cisco Systems Inc., will increase its share of the corporate phone-gear market. The company went private in 2007 through a takeover by buyout firms Silver Lake and TPG Inc.
Hackney said there were two bidders for the Nortel business. He declined to name the other party. Avaya will retain at least 75 percent of the employees at Nortel’s enterprise unit, he said.
To contact the reporter on this story: Hugo Miller in Toronto at hugomiller@bloomberg.net
Last Updated: September 14, 2009 11:04 EDT
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Avaya Wins Nortel Unit Auction With $915 Million Bid (Update3)
Share | Email | Print | A A A
By Hugo Miller
Sept. 14 (Bloomberg) -- Avaya Inc., the U.S. maker of corporate phone systems, agreed to buy Nortel Networks Corp.’s enterprise-telecommunications unit and other assets, winning an auction for the business with a bid of $915 million.
Avaya will pay $900 million in cash and $15 million for an employee retention program, Toronto-based Nortel said today in a statement. Avaya, based in Basking Ridge, New Jersey, had made an opening, pre-auction bid of $475 million for the unit, which makes phone equipment and networks for companies.
Nortel, which filed for bankruptcy protection in January, is selling off its main businesses after deciding that was a better option for creditors than trying to reorganize the company and keep it intact. Sales at the enterprise unit fell 28 percent to $465 million in the second quarter.
As part of the transaction, Nortel is also selling shares of its government solutions and DiamondWare voice technology businesses. Canadian and U.S. court approvals for the sale will be sought at a joint hearing tomorrow, it said.
Nortel sought protection from creditors after losing $5.8 billion last year amid a slump in demand for its equipment. Ericsson AB, the world’s largest maker of wireless networks, won an auction for Nortel’s wireless unit in July, agreeing to pay $1.13 billion after six rounds of bidding and trumping an opening offer of $650 million from Nokia Siemens Networks.
No Delay Expected
The deal removes “a level of uncertainty and provides a clear path for customers and employees,” Joel Hackney, the unit’s president, said on a conference call today.
He said he expects the acquisition to close this year and doesn’t foresee a related dispute between Avaya and Verizon Communications Inc. delaying the deal or court approval.
Verizon said before the auction it intended to object if Avaya won because Avaya may terminate contracts Verizon considers essential to U.S. national security.
Avaya said in a Sept. 10 court filing that it’s trying to negotiate “suitable arrangements” for assumption of the contracts.
Avaya, which competes against Cisco Systems Inc., will increase its share of the corporate phone-gear market. The company went private in 2007 through a takeover by buyout firms Silver Lake and TPG Inc.
Hackney said there were two bidders for the Nortel business. He declined to name the other party. Avaya will retain at least 75 percent of the employees at Nortel’s enterprise unit, he said.
To contact the reporter on this story: Hugo Miller in Toronto at hugomiller@bloomberg.net
Last Updated: September 14, 2009 11:04 EDT
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It's really a twist of fate, couple of years back its Nortel tries to buy AVAYA :
NEW YORK (Reuters) - A merger between Avaya Inc. and Canada's Nortel Networks Corp. could create a leading vendor of Web-based phone systems, a Prudential analyst said on Tuesday, as talk swirled over a possible buyout bid for the U.S. telecommunications equipment maker.
Avaya has long been the subject of takeover speculation due to its small size compared to rivals like Cisco Systems Inc. and due to a growing number of companies vying to sell Internet protocol (IP) phone systems to businesses.
Such talk intensified over the weekend after Avaya postponed an investor conference and media reports said it was negotiating with potential bidders including Nortel and private equity firms.
The sign in the lobby of Avaya Inc. offices and lab in Westminster, Colorado is seen January 23, 2007. A merger between Avaya Inc. and Canada's Nortel Networks Corp. could create a leading vendor of Web-based phone systems, a Prudential analyst said on Tuesday, as talk swirled over a possible buyout bid for the U.S. telecommunications equipment maker. REUTERS/Rick Wilking
Avaya's Web site did not give a reason for the postponement and did not provide a new date for the conference. Avaya's shares surged 17 percent in pre-market trade to $15.99 from their close on Friday at $13.67.
The company declined to comment.
"A combination with Nortel would create the dominant vendor in North America, EMEA (Europe, Middle East, Africa) and South America, and a stronger presence in Asia," Prudential analyst Inder Singh said in a report.
"While we believe a private-equity-led buyout is possible, and has been widely speculated on in recent months, it would not address the needed sector consolidation," the report said.
Singh said a combination with Cisco could also create a strong IP-based telephony vendor, although he added that combinations with Nortel or Cisco could draw anti-trust scrutiny.
Some analysts had previously said Cisco may not be too keen on an acquisition because it already has much of the technology that Avaya could offer, although such a deal would boost Cisco's position as a dominant communications gear vendor.
The Wall Street Journal reported that Avaya was in talks with private equity firm Silver Lake about a leveraged buyout, and had also held talks with rival Nortel about a possible deal.
Avaya and Nortel failed to agree on a price or whether Nortel would use cash or stock to fund the deal, but they were still in contact and a deal could materialize, it said.
The New York Times said Cisco, in addition to Nortel and Silver Lake, were interested in the Basking Ridge, New Jersey-based company.
J.P. Morgan analyst Ehud Gelblum said Nortel could have difficulty raising sufficient debt for an all-cash transaction, and said a combination of cash and stock was the most likely scenario in the event of such a deal.
He also said a takeout of Avaya at a 15 percent premium to Friday's closing price would be accretive to the Nortel's earnings if it could cut Avaya's operating expenses by 11 percent.
Nortel and Silver Lake declined to comment on Monday
NEW YORK (Reuters) - A merger between Avaya Inc. and Canada's Nortel Networks Corp. could create a leading vendor of Web-based phone systems, a Prudential analyst said on Tuesday, as talk swirled over a possible buyout bid for the U.S. telecommunications equipment maker.
Avaya has long been the subject of takeover speculation due to its small size compared to rivals like Cisco Systems Inc. and due to a growing number of companies vying to sell Internet protocol (IP) phone systems to businesses.
Such talk intensified over the weekend after Avaya postponed an investor conference and media reports said it was negotiating with potential bidders including Nortel and private equity firms.
The sign in the lobby of Avaya Inc. offices and lab in Westminster, Colorado is seen January 23, 2007. A merger between Avaya Inc. and Canada's Nortel Networks Corp. could create a leading vendor of Web-based phone systems, a Prudential analyst said on Tuesday, as talk swirled over a possible buyout bid for the U.S. telecommunications equipment maker. REUTERS/Rick Wilking
Avaya's Web site did not give a reason for the postponement and did not provide a new date for the conference. Avaya's shares surged 17 percent in pre-market trade to $15.99 from their close on Friday at $13.67.
The company declined to comment.
"A combination with Nortel would create the dominant vendor in North America, EMEA (Europe, Middle East, Africa) and South America, and a stronger presence in Asia," Prudential analyst Inder Singh said in a report.
"While we believe a private-equity-led buyout is possible, and has been widely speculated on in recent months, it would not address the needed sector consolidation," the report said.
Singh said a combination with Cisco could also create a strong IP-based telephony vendor, although he added that combinations with Nortel or Cisco could draw anti-trust scrutiny.
Some analysts had previously said Cisco may not be too keen on an acquisition because it already has much of the technology that Avaya could offer, although such a deal would boost Cisco's position as a dominant communications gear vendor.
The Wall Street Journal reported that Avaya was in talks with private equity firm Silver Lake about a leveraged buyout, and had also held talks with rival Nortel about a possible deal.
Avaya and Nortel failed to agree on a price or whether Nortel would use cash or stock to fund the deal, but they were still in contact and a deal could materialize, it said.
The New York Times said Cisco, in addition to Nortel and Silver Lake, were interested in the Basking Ridge, New Jersey-based company.
J.P. Morgan analyst Ehud Gelblum said Nortel could have difficulty raising sufficient debt for an all-cash transaction, and said a combination of cash and stock was the most likely scenario in the event of such a deal.
He also said a takeout of Avaya at a 15 percent premium to Friday's closing price would be accretive to the Nortel's earnings if it could cut Avaya's operating expenses by 11 percent.
Nortel and Silver Lake declined to comment on Monday
Amen brother telecomPA - I was told 3 1/2 years ago by a very wise employee to learn Avaya so I did. I do pray that Avaya will keep their 'patches' to a minimum - it was insane doing them every week after our install
Avaya product is pretty good and I think it is more data resilient than the Nortel.
Avaya product is pretty good and I think it is more data resilient than the Nortel.
Does Avaya use channel partners like Nortel does? I was under the impression Avaya did all of their own stuff from making the product, selling it, installing it, and maintaining it. Is this correct or do they use partners to sell, install, and maintain?
War Eagle!
Lions Baseball '09!
War Eagle!
Lions Baseball '09!
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[©] GHTROUT.com [⇔] Resources for Nortel Meridian/CS1000 System Administrators - You Can Hire Me Too
[©] GHTROUT.com [⇔] Resources for Nortel Meridian/CS1000 System Administrators - You Can Hire Me Too
My take on this:
Avaya does use Channel Partners, but usually only to sell product. When it comes to this, thier agreements usually do not allow Channel Partners to compete against them for the same sale.
This greatly limits what an Avaya Channel Partner can do with a customer.
As far as maintenance it is true that Avaya likes to keep all Managed Services in house and farm out the actual work to key Channel Partners. This too limits what we all can do to support customers.
I see them keeping the BCM product since they don't really have a good small business product, but why would the want to keep a competing system out there, with the CS1000 line?
All PBX's are basically the same. They provide the same functions, as do voicemail systems and Call Center systems.
I think they will be in court with Anti-trust suits, and possibly the Government issues, but eventually the Nortel Portfolio will be gone. Then you will have a number of companies that will continue to use their systems until they no longer give them the functionality they desire and then make a swap to a new system.
So, if you have a nortel system for voice and a cisco data network and you need to replace your voice system, do you go to a new plaform with a new company or do you go to a company that you already have a working relationship with?
Learn Cisco. CCNA, CCVP and CCIE. They may not pay as much as they used to, but the money is still good and that will be the direction I think some Nortel customer's will go.
I don't think this was a good thing for all the small Nortel service providers, but the bigs will just absorb all the business. Look at Shared. didn't they just become an Avaya Partner? Look to them to provide most of the supprot for Avaya direct.
I bet that Siemons/Gore would get the Nortel product, because they were offering cash and Avaya was a little in debt and couldn't afford the buyout. But if you need to get rid of your competition and then have over 50% of the market share after done. I guess $1B isn't that big of a cost.
My two cents on this.
Avaya does use Channel Partners, but usually only to sell product. When it comes to this, thier agreements usually do not allow Channel Partners to compete against them for the same sale.
This greatly limits what an Avaya Channel Partner can do with a customer.
As far as maintenance it is true that Avaya likes to keep all Managed Services in house and farm out the actual work to key Channel Partners. This too limits what we all can do to support customers.
I see them keeping the BCM product since they don't really have a good small business product, but why would the want to keep a competing system out there, with the CS1000 line?
All PBX's are basically the same. They provide the same functions, as do voicemail systems and Call Center systems.
I think they will be in court with Anti-trust suits, and possibly the Government issues, but eventually the Nortel Portfolio will be gone. Then you will have a number of companies that will continue to use their systems until they no longer give them the functionality they desire and then make a swap to a new system.
So, if you have a nortel system for voice and a cisco data network and you need to replace your voice system, do you go to a new plaform with a new company or do you go to a company that you already have a working relationship with?
Learn Cisco. CCNA, CCVP and CCIE. They may not pay as much as they used to, but the money is still good and that will be the direction I think some Nortel customer's will go.
I don't think this was a good thing for all the small Nortel service providers, but the bigs will just absorb all the business. Look at Shared. didn't they just become an Avaya Partner? Look to them to provide most of the supprot for Avaya direct.
I bet that Siemons/Gore would get the Nortel product, because they were offering cash and Avaya was a little in debt and couldn't afford the buyout. But if you need to get rid of your competition and then have over 50% of the market share after done. I guess $1B isn't that big of a cost.
My two cents on this.
I agree with Janaya there is a possibility even court approves the sale, they will eventually sell it because Avaya according to the reports and news accumulated debt to acquire companies like Skype and we dont know if this company really is making money as they are private and they can choose if they want to make public their financial status.
These days like Janaya said PBX are all the same they provide same features,customers are looking at vendors that has "deep pocket" that they will not worry about the future well i think Cisco is more stable that Avaya financially.
Integration path is not clear,but Avaya has Aura that can interoperate all vendors but then again there still CS1000.
My opinion is wait and see what will happen in a year and we can see clearer, things these days are fast moving ..
These days like Janaya said PBX are all the same they provide same features,customers are looking at vendors that has "deep pocket" that they will not worry about the future well i think Cisco is more stable that Avaya financially.
Integration path is not clear,but Avaya has Aura that can interoperate all vendors but then again there still CS1000.
My opinion is wait and see what will happen in a year and we can see clearer, things these days are fast moving ..
It will be interesting to see what happens. My take is that Avaya wanted the data (switches, routers, etc.) side more than the voice to compete as a vertical all-from-one-source solution for customers, such as hospitals and education (two places I know locally have Nortel phone and data).
This Blog has a point:
If Avaya can keep transition costs down, and do it quickly, the Nortel buy could be a bargain when the merged operations are taken public, again, as Silver Lake and TPG plan to do sometime in the not so distant future (especially after the economy fully recovers). The new larger entity will bring a better price than Avaya by itself.
The problem, though, is will Silver Lake and TPG ever recover their original purchase cost of about $9 billion for Avaya and Nortel? This I believe will be difficult, because Avaya's acquisition of Nortel may help improve the new entity's market position, but with the strong possibility of Microsoft replicating Cisco's success and the former continuing to march forward it will be difficult to keep the existing customer base intact and roll up sufficient profits for the private equity firms not to write off a few billion dollars on their investments. But stranger things have happened.
I would like to know after the smoke clears and Nortel ES is safely merged within the bosom of Avaya, how the enlarged company plans to fight off the software and data networking giants from market dominance positions. And what about a Google market entry (something that cannot be discounted just yet)?
Stay tuned boys and girls to this same bat channel, same bat time, to see if the dynamic duo of Avaya and Nortel can fend off the dastardly attacks of their two arch villains
If Avaya can keep transition costs down, and do it quickly, the Nortel buy could be a bargain when the merged operations are taken public, again, as Silver Lake and TPG plan to do sometime in the not so distant future (especially after the economy fully recovers). The new larger entity will bring a better price than Avaya by itself.
The problem, though, is will Silver Lake and TPG ever recover their original purchase cost of about $9 billion for Avaya and Nortel? This I believe will be difficult, because Avaya's acquisition of Nortel may help improve the new entity's market position, but with the strong possibility of Microsoft replicating Cisco's success and the former continuing to march forward it will be difficult to keep the existing customer base intact and roll up sufficient profits for the private equity firms not to write off a few billion dollars on their investments. But stranger things have happened.
I would like to know after the smoke clears and Nortel ES is safely merged within the bosom of Avaya, how the enlarged company plans to fight off the software and data networking giants from market dominance positions. And what about a Google market entry (something that cannot be discounted just yet)?
Stay tuned boys and girls to this same bat channel, same bat time, to see if the dynamic duo of Avaya and Nortel can fend off the dastardly attacks of their two arch villains
I wouldn't WOO HOO too much. Often when one company in financial trouble buys another "troubled" company they both go down the tubes.
I was at the Avaya office in the Dallas area, recently, for training. It was a newer three-story building in an office park, near the DFW airport. It's a mostly empty ghost-town.
(And you have to reboot an IP Office system to move a phone remotely? What's up with that?)
I was at the Avaya office in the Dallas area, recently, for training. It was a newer three-story building in an office park, near the DFW airport. It's a mostly empty ghost-town.
(And you have to reboot an IP Office system to move a phone remotely? What's up with that?)
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