Posted on 01/14/2009 6:52:52 AM PST by Lurker
Nortel Networks Corp. filed for Chapter 11 bankruptcy protection in the United States on Wednesday, one day before it was due to make a $107 million interest payment.
The Toronto-based company and several of its affiliates made the filing in federal bankruptcy court in Delaware.
The move came shortly after the Nortel's shares were halted on the TSX.
According to The Globe and Mail, Nortel is also expected to file for bankruptcy protection in Toronto.
"Bankruptcy protection keeps the creditors at bay while you reorganize or sell parts of the business," BNN's Michael Kane reported Wednesday.
The company's board of directors reportedly met in Toronto Tuesday to discuss Nortel's future.
Excerpted. Balance of story here.
At one time Nortel shares were tradaing for over $120.00.
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(Excerpt) Read more at ottawa.ctv.ca ...
A very sad end for the once proud Northern Electric.
So, are all the long-term, long-suffering NT share holders now holding dust?
Their core switches for Telcos were the industry standard for years.
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Agree. It is sad.
At one time Nortel stock was trading at over $100.00 a share. Last I checked it was about .40. I'd say they've been holding dust for a while.
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I was part of a layoff in May of last year, after working there eight years, and while I and my colleagues were successful in saving the company tens of millions of dollars over those years, it apparently wasn’t enough.
I was proud to work there, and proud of the technology that the engineers I supported were developing, and it’s very sad to see it come to this kind of low.
As a Nortel Tech, their TDM systems are the finest on the market..Option 11, 61, 81 are workhorses that’ll run through anything..but their VOIP BLOWS..it’s unreliable, constantly needs patching, crashes often etc. etc..
Sad. Where I work we are a Nortel shop. Don’t see that changing just yet, as their products are less expensive than Cisco and have better technological advances (e.g. Nortel SMLT vs. Cisco VSS, etc.)
Their pension costs killed them along with not sticking to core competencies...
Don't forget the 10-for-1 reverse split. The adjusted value of that $120 high mentioned in that article is $1,200 per share. I had options with a strike price of $540 per share.
Heck yeah - did you hear about the Dual-Polarization Quadrature Phase-Shift Keying technology, DP-QPSK? It lets you send 40 gigabits a second down fiber that used to be barely-usable for 10 gigabits.
My concern is that senior management at many shops will insist a switch to Cisco for future purchases. For all the good that standards provide, “vendor interoperability” is an art, not science. I’ve got a lot less hair for all the grief encountered with companies who insisted their hardware was IEEE 802.3ad compliant.
Nortel's DMS series is still the standard in a lot of CO's. Ditto the Supernode for wireless, which is essentially based on the DMS-10.
Having worked on many Nortel projects across the globe, I can tell you that this news doesn't surprise me in the least. Nortel is notorious for stepping over dollar bills to pick up pennies. They also have a management through intimidation philosophy that doesn't make their employees very loyal....
Agreed. It is a very significant sign of the enormous changes afoot.
Was this a problem of too much debt?
Clearly when times are good, leverage (debt) can be great.
When the economiy slows, fixed interest costs can be very harmful. Maybe many firms just took on too much debt relative to their cash flows from operations.
I worked for them 10 years ago in Richardson Texas. Back then, nearly all of the buildings in the Telecom Corridor had the Nortel logo on them.
What location did you work for Nortel?
It is sad. My shop is Mitel and Cisco (VoIP) and HP ProCurve and Cisco (core and edge switching). While in this business environment it helps when your competition is on the ropes one never likes to see an industry leader fall.
Well, other than Cisco anyway...LOL
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For what my shop does I don’t like them as much as our Juniper equipment. That said, if anyone deserves a bailout more than the car companies, they do.
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