Tom Sweeney

It's a coming of age tale….

Posts Tagged ‘Ciena’

Nortel to Sell Ottawa Carling Campus to Public Works and Government Services Canada

Posted by sweens on October 19, 2010

October 19, 2010

TORONTO – Nortel Networks Corporation announced that as part of its focus on maximizing value for its stakeholders, its principal operating subsidiary Nortel Networks Limited and Nortel Networks Technology Corporation (together, Nortel) have entered into a sale agreement with Public Works and Government Services Canada (PWGSC) for the sale of Nortel’s Ottawa Carling Campus, for a cash purchase price of CDN$208 million. The sale, targeted to close at end of year, is subject to customary closing conditions as well as approval of certain governmental authorities and of the Ontario Superior Court of Justice.

The Ottawa Carling Campus is located on 370 acres of land in Ottawa’s National Capital Commission greenbelt, and is comprised of 11 interconnected buildings totaling over 2 million square feet.

The sale agreement provides for Nortel to continue to occupy parts of the Campus for varying periods of time to facilitate Nortel’s continuing work on its global restructuring including work under the transition services agreements with the various buyers of Nortel’s sold businesses. All other existing leases will be assumed by PWGSC, including leases with buyers of Nortel’s businesses. With respect to the lease with Ciena, the purchaser of the Optical Networking and Carrier Ethernet (MEN) business, Nortel is directed by PWGSC under the sale agreement to exercise, on closing, Nortel’s early termination rights under the lease, shortening the lease from 10 years to 5 years. This will result, pursuant to the lease with Ciena, in the repayment to Ciena of US$33.5 million from the escrowed sale proceeds from the MEN sale.

The sale agreement further provides that at closing title will be delivered free and clear of all encumbrances, including the charge in favour of Nortel Networks Inc. with respect to an intercompany loan agreement, under which US$75 million is outstanding as previously announced and reported.

As previously announced, Nortel does not expect that the Company’s common shareholders or the NNL preferred shareholders will receive any value from the creditor protection proceedings and expects that the proceedings will result in the cancellation of these equity interests.

http://www2.nortel.com/go/news_detail.jsp?cat_id=-8055&oid=100269828&locale=en-US&lcid=-1

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Zarlink turnaround continues as revenue targets exceeded

Posted by sweens on July 29, 2010

Kanata-based Zarlink Semiconductor beat its revenue targets by 18 per cent year-over-year in first-quarter results announced on Thursday.

The firm’s revenues reached $58.7 million, which exceeded their earlier revenue guidance of between $57 million and $58.7 million.

Zarlink stated this was due to “increasing customer demand across all core segments of the business,” particularly in communications products, where revenue grew by $3.9 million, and medical products, up $1.3 million.

Basic earnings were at $0.08 per share and $0.07 per diluted share.

Zarlink earlier sold its optical-products unit, which generated net proceeds of $13.5 million.

The firm said it expects to see more demand for its next-generation carrier chipset products, which includes voice-over-broadband and new efficiencies in wireless to improve the speed.

Customers such as Ciena Corp. and Teias Networks have integrated Zarlink’s ClockCenter timing platform into their video products, allowing them to lower power consumption and simplify the design, Zarlink stated.

“Q1 was a very strong start to fiscal 2011,” stated president and chief executive Kirk Mandy.

“While capacity concerns are impacting the global semiconductor industry, we are working closely with our foundry partners to ensure we continue to meet delivery commitments as end-market demand for our products escalates.”

As part of its work beyond semiconductor, the company grew its medical revenues to $6.6 million, from $5.3 million in the fourth quarter of fiscal 2010.

The money came from shipments of wireless radio modules that were allowed for medical applications after approvals from the United States’ chief medical approvals body, the Food and Drug Administration.

However, year-over-year revenue fell from $9 million in Q1 2010 to the $6.6 million posted in Q1 2011.

Zarlink further made the following forecasts for Q2 2011:

– Revenue between $58.5 million and $60.5 million;

– Gross margins between 50 per cent and 51 per cent;

– Operating expenses between $20.5 million and $21.5 million, excluding amortization of intangibles;

– Q2 earnings of $0.03 to $0.05 per share, excluding foreign exchange fluctuations.

http://www.obj.ca/Technology/2010-07-29/article-1631108/UPDATE%3A-Zarlink-turnaround-continues-as-revenue-targets-exceeded/1

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Nortel sells its joint venture with LG Electronics for US$242M

Posted by sweens on April 29, 2010

Another piece of the former Nortel Networks empire has been sold, with the Canadian company’s interest in a Korean operation going to LM Ericsson for US$242 million.

Nortel announced the sale of its 50 per cent plus one share interest in LG-Nortel Co. Ltd., the company’s joint Korean venture with LG Electronics Inc., late Tuesday.

The agreement marks the sale of one of only a few remaining assets of Nortel, formerly Canada’s biggest information technology company and once a leading global vendor of telecommunications equipment.

Still remaining are a variety of patents and Nortel’s Passport division, which provides non-optical equipment and was a piece of the Metro Ethernet Networks division that did not sell to Ciena Corp. in a US$521-million transaction last year.

A spokeswoman for Nortel said it’s still unclear what will happen to the remaining assets, which would also include potential tax-loss recoveries that could be used by a profitable company.

“Nortel will assess other restructuring alternatives for its remaining businesses in the event it is unable to maximize value through sales,” said Nortel representative Jamie Moody in an email.

LG-Nortel was established in 2005 to provide telecommunications equipment and network solutions to customers in Korea and around the world.

The sale is subject to approval of the Ontario Superior Court of Justice and must meet certain regulatory conditions.

Earlier this month the financially battered Nortel received another extension to its creditor protection to the end of July, in order to give the fallen Canadian technology company more time to complete a court-supervised restructuring.

The company filed for court protection in the United States, Canada and other jurisdictions in January 2009, and has since sold most of its major operations to former rivals.

At its peak during the 1999-2000 technology boom, Nortel was Canada’s most valuable company after the telecom equipment maker went through several years of rapid expansion and diversification funded by debt and stock sales.

But starting in 2001 Nortel suffered a precipitous decline in sales, due to a combination of factors including the merger or demise of many of its customers, economic slowdowns and an accounting scandal.

 http://www.obj.ca/Technology/2010-04-21/article-1032689/Nortel-sells-its-joint-venture-with-LG-Electronics-for-US%24242M/1

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2009: A year of flux in Ottawa tech

Posted by sweens on December 18, 2009

Published on December 15th, 2009

Jim Donnelly
Ottawa Business Journal

Heady startup activity counteracted by liquidation of various headquarters

It’s been a year of soul-searching, self-help and growing foreign influence for Ottawa technology industry, say observers, but they add that doesn’t mean it’s been a bad 2009 – quite the opposite, in fact, depending on with whom you speak.

But what were the main trends we saw this year, according to those in the trenches? Most obvious, says Pat DiPietro of VG Partners, was the conspicuous absence of venture-backed, early-stage companies hatched in the nation’s capital this year. “The lack of capital has created a gap in the sequence of planting crops and then husbanding them along,” he says.

That’s led to a diversification amongst the Ottawa tech scene from traditional telecom and other technology infrastructure markets, into more lithe, media-style software and social media companies not requiring heavy injections of initial capital.

“(OCRI) likes to continue the mantra that we’ve got a lot of companies starting these days, but they’re all two- or three-person operations,” he adds. “And they’re being bootstrapped.”

OCRI chief executive Claude Haw agrees that 2009 was a year of diversification for local firms. He says this past year was a “coming-out” period for digital media in the city, adding that his organization is now tracking around 200 local companies in the space.

“And the other trend was the retooling that’s gone on in the region,” he says, adding that programs such as Lead to Win are indicative of a series of initiatives recently launched to assist budding entrepreneurs.

But 2009 also saw its fair share of formerly Ottawa-headquartered companies bought and sold by foreign interests. The Nortel saga – which by December had seen the company sell off chunks of its former businesses to companies such as Nokia-Siemens, Ericsson and most likely Ciena, as well – needs little explanation. In June, local success story Tundra Semiconductor was bought by Silicon Valley-based IDT, trumping a bid by rival Gennum Corp. In September, it was revealed that Philadelphia-based Versa Capital would take local defence products maker Allen-Vanguard private. And in late November, Corel Holdings announced that Vector Capital’s all-cash offer for all outstanding Corel Corp. shares had been successfully completed.

Mr. DiPietro says the influx of foreign ownership isn’t a good sign for Ottawa, since it means the dissolution of executive office training grounds for nascent management teams.

“One of the problems with foreign owneship is that the decisions aren’t made here, and so we’ve allowed ourselves to fall into a bad situation,” he says. “We’re in the situation where we’re becoming a branch plant again. We were somewhat out of that for a while (in the late 1990s and 2000s).

“It’s really disturbing, because the problem we’ve always had in Ottawa will be reinforced – we’ve never had lots of management teams here who could create world-class companies. And as those functions get centralized, our people won’t be trained to be great managers.”

Mr. Haw takes a somewhat different angle to the foreign ownership question. He says most consolidation has happened in mature sectors, where there’s always been a constant push to become bigger and more market-dominant. “It’s all about the big, broad market opportunities with these sectors,” he says. “And unfortunately Nortel didn’t make it as a consolidator – they became consolidated.

“But if you look at Alcatel compared to Newbridge Networks, that consolidation has worked in our favour. We’ve had more high-paying jobs locate here after that merger, than if Newbridge hadn’t consolidated.”

And as for the effect of the Nortel consolidation, Mr. Haw says locals shouldn’t think of it as a loss of one, large anchor tenant – indeed, he says it’s almost a misnomer to think of Nortel as an Ottawa company, since they haven’t been headquartered here for years. Instead, thanks to the increased presence of world-class firms such as Ericsson and Nokia, Mr. Haw says we should look at the situation as the gaining of three or four new anchor tenants.

“When a company like Nortel is acquired by Ericsson it brings stability,” he says. “Look at Cognos. They’re now bigger and better than they ever were (before being acquired by IBM).”

http://www.obj.ca/Technology/2009-12-15/article-281645/2009%3A-A-year-of-flux-in-Ottawa-tech/1

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