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The Toronto-based Nortel group will auction its second biggest division next Friday. The company is selling its businesses to pay off its creditors.
The auction of Norton’s network equipment manufacturing unit will take place under court supervision.
US-based Avaya Inc. is one of the bidders with an offer of $475 million. The bidding closed on Friday. The 124-year-old Canadian enterprise incurred losses accounting to $5 billion last year and since January has been operating under bankruptcy protection.
Nortel has already sold its next-generation wireless business to Sweden's Ericsson under a court-supervised auction for $1.13 billion on July 28.
But the deal is being reviewed after BlackBerry maker Research In Motion (RIM) and political parties pressured the Canadian government not to let "sensitive technology" fall into foreign hands.
This enterprise unit of Nortel manufactures network equipment such as routers, IP phones, switches and other security products for big corporations.
According to media reports, the other bidders in race along with Avaya could be Berlin-based Siemens Enterprise Communications and New York-based private equity firm MatlinPatterson Global Advisers LLC.
The auction of Nortel’s second biggest division also needs approval from bankruptcy courts in the US and Canada.
The Canadian corporate brand, Nortel once accounted for almost one third of the Toronto Stock Exchange (TSX).
Nortel’s downfall started with the dotcom bust of 2000, with its market capitalisation dropping from almost $400 billion to $5 billion within two years. Its stock sank from $124 to $0.47.
The telecom giant suffered further losses with an accounting scandal in 2004 .In 2006, Nortel had to pay $2.5 billion to settle shareholder class actions.
At its height, Nortel employed more than 90,000 people worldwide.
