Nortel announced the sale of its 50 per cent plus one share interest in LG-Nortel Co. Ltd., the company's joint Korean venture with LG Electronics Inc., late Tuesday.
The agreement marks the sale of one of only a few remaining assets of Nortel, formerly Canada's biggest information technology company and once a leading global vendor of telecommunications equipment.
Still remaining are a variety of patents and Nortel's Passport division, which provides non-optical equipment and was a piece of the Metro Ethernet Networks division that did not sell to Ciena Corp. in a US$521-million transaction last year.
A spokeswoman for Nortel said it's still unclear what will happen to the remaining assets, which would also include potential tax-loss recoveries that could be used by a profitable company.
"Nortel will assess other restructuring alternatives for its remaining businesses in the event it is unable to maximize value through sales," said Nortel representative Jamie Moody in an email.
LG-Nortel was established in 2005 to provide telecommunications equipment and network solutions to customers in Korea and around the world.
The sale is subject to approval of the Ontario Superior Court of Justice and must meet certain regulatory conditions.
Earlier this month the financially battered Nortel received another extension to its creditor protection to the end of July, in order to give the fallen Canadian technology company more time to complete a court-supervised restructuring.
The company filed for court protection in the United States, Canada and other jurisdictions in January 2009, and has since sold most of its major operations to former rivals.
At its peak during the 1999-2000 technology boom, Nortel was Canada's most valuable company after the telecom equipment maker went through several years of rapid expansion and diversification funded by debt and stock sales.
But starting in 2001 Nortel suffered a precipitous decline in sales, due to a combination of factors including the merger or demise of many of its customers, economic slowdowns and an accounting scandal.