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Tag: Nortel Networks

  • Nortel, Huawei to set up JV for broadband access market

    Nortel, Huawei to set up JV for broadband access market

    MUMBAI: Nortel Networks and Huawei Technologies Co. Ltd. are setting up a joint venture to develop ultra broadband access solutions that will carry video content.

    The two companies have also entered into a supply agreement that allows Nortel to immediately begin engaging customers with Huawei’s current industry-leading broadband access portfolio.

    The new JV company will combine Huawei’s market leading broadband access solutions with Nortel’s voice and broadband networking technologies to create a new product portfolio. These products will give service providers the ability to converge the delivery of voice, video, data and wireless services to business and residential customers onto a common IP platform that supports copper, fiber and fixed wireless networks.

    The parties intend that the joint venture will be majority-owned by Nortel and headquartered in Ottawa. The joint venture will be focused on product enhancements for Huawei’s current broadband access portfolio and the development of a new ultra broadband product portfolio. This portfolio will be sold exclusively to Huawei and Nortel as channel providers, the release adds.

    “We believe the cooperation with Nortel, a leader in the telecommunications industry, will enable us to create greater value for our customers,” says Huawei chairwoman Yafang Sun. “The joint venture will combine Huawei and Nortel’s advanced technologies and products, to create leading broadband access solutions to meet customers’ needs. It will bring better value to our existing and potential customers.”

    “Nortel is focused on seizing opportunities that will generate new revenue and expand operating margin. This joint venture is a bold opportunity to combine the strengths of Huawei and Nortel into a company that can aggressively target and win share in the rapidly expanding ultra broadband market,” adds Nortel president & CEO Mike Zafirovski. “This will create a powerful new player in what is a high growth market.”

    Nortel and Huawei expect to complete the formation of the joint venture in the third quarter of 2006. Joint development of products has already begun, with availability expected for all markets by the third quarter of 2006. The proposed joint venture is subject to execution of definitive agreements and customary regulatory approvals.

  • Canada’s Nortel Networks forms JV with LG Electronics

    Canada’s Nortel Networks forms JV with LG Electronics

    MUMBAI: Canadian telecom giant Nortel Networks and South Korea’s LG Electronics have established a joint venture for the development of telecom equipment and networking solutions.

    The agreement was signed in Seoul, South Korea by LG Electronics CEO S.S. Kim and Nortel vice chairman and CEO Bill Owens. The joint venture will be tentatively named LG-Nortel Co. Ltd. This entity will combine the telecommunication infrastructure business of LG Electronics and the distribution and service business of Nortel in South Korea.

    The LG-Nortel joint venture will support the strategies of both companies for ongoing development of leading-edge wireline, optical, wireless and enterprise communications and networking solutions to ignite and power global commerce. It will also reflect the companies’ commitment to leveraging best-in-class resources and expertise by joining forces with leading players in key markets, while harnessing the technology leadership of South Korea, states an official release.

    Nortel will own 50 percent plus one share in the joint venture, in exchange for which Nortel will contribute its South Korean distribution and services business and pay $145 million and other non-monetary consideration. Separately, LG Electronics may be entitled to payments over a two-year period based on achievement by the joint venture of certain business goals.

    LG Electronics and Nortel will nominate certain key executives to the management team of the joint venture. It is the intention of the parties to nominate JR Lee from LG Electronics to be chief executive officer and Paul House from Nortel to be chief operating officer. The LG Electronics Infrastructure business and Nortel’s South Korean operations had aggregate revenues of KRW 600 billion ($530 million) in 2004, the release adds.

    Closing of the transaction is subject to satisfaction of certain conditions, including regulatory and other approvals, and is anticipated by year end. J. P. Morgan advised Nortel and Lehman Brothers and Woori Securities advised LG Electronics in this transaction.