Ciena Corporation Wins Bid For Nortel's Optical Networking, Carrier Ethernet Businesses

November 24, 2009 4:02 p.m. EST

Toronto, Ontario (AHN) - Ciena Corporation was declared on Monday as the winning bidder for Nortel Network's optical networking and carrier Ethernet businesses. Ciena's winning bid was $530 million cash, plus $239 million principal amount of convertible notes due June 2017.

Aside from the buy-out, a minimum of 2,000 Nortel workers would have the chance to continue their jobs as Ciena employees. While antitrust clearance for the sale had been secured for the transaction, it will still require U.S. and Canadian courts approval, which will be done in a joint hearing slated on Dec. 2.

The sale includes all product platforms, patents and intellectual properties used in the two businesses.

Nortel Metro Ethernet Networks President Philippe Morin said in a statement, ""Uniting our two optical businesses is a game changing event for the optical industry, creating a leader that has the end-to-end portfolio, industry innovation leadership, and significant global customer base to succeed in today's highly competitive market. Ciena's commitment to the future of our product platforms, customers and employees represents an exceptionally positive outcome to a challenging journey that started over a year ago. Our employees have always been the core value of our business, and their ability to continue to innovate as part of a global industry leader is one of the most satisfying results of today's news."

Ciena President and Chief Executive Officer Gary Smith said in a letter to the company's employees, "Across all industries, the uncertainty of the current economic environment has created some tough business challenges, but it also is opening new doors. We see a rare opportunity in this transaction to rapidly advance our goal of being a leading network solutions supplier focused solely on automated optical Ethernet networking innovation."