Nortel seeks buyer for stake in LG-Nortel JV

Files a motion with the Ontario Superior Court of Justice for approval

Nortel Networks said that it is looking for a buyer for its majority stake in LG-Nortel, the company's joint venture with South Korea’s LG Electronics.

The telecommunication company said that the decision has been made to secure a sound future for the LG-Nortel, its customers and employees. It also said that the joint venture has a strong balance sheet and has not filed for creditor protection as Nortel did in January. The JV achieved a management operating margin of $341m in 2008.

The company further added that it will file a motion with the Ontario Superior Court of Justice for approval of a proposed sale process which has been agreed with LG Electronics. Goldman Sachs has been appointed to assist with the proposed divestiture.

Peter MacKinnon, chairman and general manager of LG-Nortel, said: “With a competitive portfolio of wireless, wireline and enterprise solutions, LG-Nortel is a market leader in Korea and select international markets. Our number one priority is the continued success of LG-Nortel and our customers.

Mike Zafirovski, president and CEO of Nortel, said: LG-Nortel is a successful business with an accomplished leadership team, a culture of innovation, a dedicated employee base and a drive to succeed. As we work to evaluate the ultimate path forward for all of our businesses, this decision will allow LG-Nortel to embark on the next phase of its journey and realise its full potential.

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