Five months after it sought bankruptcy protection with the intention of trading its way out of trouble, Nortel has begun the fire sale of its assets.
The Canadian vendor, which at the height of the tech boom was valued at $250 billion, last month agreed to sell its LTE and CDMA businesses to Nokia Siemens Networks (NSN) for just $650 million.
It said it was continuing in discussions to sell its other businesses.
CEO Mike Zafirovski has admitted his original plan had been to restructure the company, but the onset of the recession, and its lack of scale, had given him no choice but to break the company up.
He said his priority would be to complete 'advanced negotiations' with potential buyers of its other units, such as its enterprise and metro Ethernet divisions, and its stake in its LG joint venture, the Financial Times reported.
The asset sales would be the best way 'to carry Nortel innovation forward, while preserving employment to the greatest extent possible,' he said.
Under the deal with Nokia Siemens, more than 2,500 Nortel staff - including 400 working on LTE - will transfer to the new owner. The transaction requires approvals from US and Canadian courts, which are expected to hear the case by the end of July.
Canada's state export credit agency, Export Development Canada (EDC), will lend $300 million to back the transaction.
Nokia Siemens CEO Simon Beresford-Wylie said the Nortel assets offered the chance for the European vendor 'to strengthen its position in two key areas, North America and LTE, at a price that makes good economic sense.'
Nortel is the second largest supplier of CDMA infrastructure in the world, with sales to three of the five top CDMA operators. US carriers Verizon, Bell Mobility and Sprint Nextel, and Canadian vendor Telus issued statements supporting the deal.