Avaya Purchases Nortel Enterprise Assets

The highly anticipated news of Nortel’s Enterprise Solutions business being sold to either Siemens or Nortel is here. The envelope please… And the winner is… Avaya – subject to bankruptcy bidding rules and court approval of course. Here are some details on stalking horse bids in bankruptcy auctions if you are so inclined.

What Avaya gains from this deal is marketshare, a talented engineering team, distribution channels, some very green systems and a lot more such as a great UC relationship with Microsoft and the B2B virtual-world technology including 3D stereo VoIP incorporated in Web.Alive.

The downside to mergers of course are integration issues, cultural issues, increased bureaucracy and lots of other challenges such as merging product lines, etc.

Then again in such a situation Nortel’s employees which are kept on will likely be thrilled the company’s assets were sold and could likely be some of the most motivated workers on Avaya’s payroll. In addition, the chance of large-scale Nortel/Avaya defections is low in this economy.

In the end, Avaya picked up a distressed asset at what will likely prove to be great price, $475 million and with that comes lots of solid relationships and great technology.

More importantly all these products and services — the ones that remain anyway, will now be promoted without the baggage of a half-decade plus on and off financial mess.

Probably most importantly, Avaya is one of the best marketers in the business and they will now have a more interesting story to tell, not to mention a slew of new products to promote.

I am looking forward to watching Avaya’s integration efforts very closely and it will be interesting to see what they make of these new assets.

  • rich salter
    July 20, 2009 at 3:09 pm


  • Tony Rybczynski
    July 22, 2009 at 6:47 am

    Nortel has a large data business (competitive technology and some great customers), which has been undersold in Nortel and likely more so if it’s part of Avaya. The way out is to bring back Bay Networks, in this case by merging with cabletron, another Silver lake asset. What’s your take.

  • http://openid.aol.com/got607
    August 20, 2009 at 1:43 pm

    You are woefully misinformed. There has been no “purchase”. The only thing Avaya has done is submit an initial (lowball) bid. This is just what NSN did for the LTE portion of Nortel. They lost out to Ericsson who offered up a final price close to 3 times the initial NSN bid. That sale has still not completed.

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