The Conservative government's new budget was revealed on Jan. 27 with the government projecting deficits of $33.7 billion in 2009 and $29.8 billion for 2010. While the move to a budget deficit is sudden, we need to keep in mind that the Canadian government has been appropriately countercyclical: it has run a balanced budget for the last decade culminating in surpluses in 2006 and 2007. Politics aside, the decision to turn to a substantial deficit in the coming years is economically the right move as the government needs to help bolster demand. The question remains: Is it enough?
Canada currently has the lowest net debt/GDP ratio in the G7 at 29 per cent, which is only projected to rise to 32 per cent with the new government spending plan. One is struck by how differently Canada enters this recession compared with the U.S., where net debt/GDP is closer to 50 per cent. The U.S. budget deficit for 2009 is projected to be in the $1.2-trillion range, almost nine per cent of GDP
Yet despite these vast differences, how realistic is it that Canada is going to be able to skate by without serious government intervention? As unemployment in Canada inches upward to seven per cent, all recent data indicate that the economy is shrinking rapidly.
Which brings us to what might be done about it. One of the more troubling developments over the last month in Canada is the Nortel bankruptcy. One of the nation's 25 largest companies, Nortel has long been a leader in the Canadian technology sector and the country's largest R&D spender. Nortel never recovered from the dot.com bust and finally succumbed early this year to the growing pressures of both poor economic conditions and its weak balance sheet position.
Bankruptcy is even less attractive an option now than it was prior to the credit collapse. With debtor in possession financing hard to come by and sales figures increasingly being revised downward, some companies that might have survived a reorganization in the last credit cycle are succumbing to liquidation this time around. Given this backdrop, it's no surprise that the market seems to expect the worst for Nortel. Nortel's debt trades at 20 cents on the dollar, levels implying a liquidation.
In better market conditions, one might have expected Nortel to be gobbled up. The value for an acquirer being access to the $10-billion revenue stream that Nortel generates. The revenue line reflects customer relationships and a distribution network that is very difficult for a competitor to replicate. The problem now is that if you expect Nortel to be liquidated, stranded customers are going to be looking for new vendors anyway and competitors see no reason to pay for Nortel's sales network.
Might there be an opportunity then? In 2007, Taiwan unveiled an ambitious $700-million program to develop a next-generation mobile WiMAX network over the entire country. The goal being to develop within Taiwan a peerless wireless broadband network and, in doing so, provide a stable platform from which Taiwanese companies could develop first-mover advantages in manufacturing.
This might be exactly the type of solution that Canada needs right now. Subsidizing 21st century infrastructure networks in Canada works simultaneously to overcome inequalities in education and economic development and could also sow the seeds of future innovation and development.
Such an investment might also be an important part of a solution for Nortel allowing the company time to bridge its revenue gap until the economy recovers and simultaneously develop competencies and market share in emerging technologies. Perhaps most importantly for Canada, Nortel would survive as an R&D centre providing quality technology jobs and training for Canadians.
There is a time and a place for conservative economic policies and from Canada's perspective this is surely not it. In the last six months, President Barack Obama as well as many others have echoed Nixon's famous phrase "We're all Keynesians now."
From Canada's perspective at least, why not? We enter this recession from a position of relative strength and shouldn't shy away from aggressive measures to stem the downturn and likewise set ourselves up for a strong recovery.
Dr. Hans Black OWN is the chairman of Montreal investment management firm Interinvest Corp.
© Copyright (c) The Montreal Gazette
Wednesday 04 February 2009
Nortel's commuter CEO and his sky-high tab
Mike Zafirovski has racked up hundreds of thousands of dollars worth of personal travel on company jet since joining the company in 2005
Nortel Networks Corp. [NT-T] has clients from Santiago to Siberia, but the most popular destination on the chief executive officer's map during the most critical 12 months in the company's history has been a small city 60 kilometres north of Chicago called Waukegan.
Monday 19 January 2009
Cover story: Canadian innovation
Monday 19 January 2009 Will Nortel still have the money to go to school?
From scholarships to co-ops, internships, research chairs and high-tech laboratories, company has provided more research funding than any other private company in Canada
Thursday 15 January 2009 It's time for Nortel to find its own way - finally
Vision, not a bailout, is what's needed
TORONTO: NORTEL FILES FOR BANKRUPTCY
The Canadian telecom giant, Nortel, has filed for bankruptcy. North America's largest telecommunications company has faced trouble since the high-tech bubble burst eight years ago. Nortel employs about thirty-two-thousand people around the world. It plans to continue business as usual while it restructures. Canada's Industry Minister, Tony Clement, says that the government is ready to provide financing to help Nortel restructure. The bankruptcy filing will affect the company's debts and other operations, including sponsorships. Nortel remained committed, however, to sponsoring the 2010 Winter Olympic Games in Vancouver.
Wednesday 14 January 2009 Nortel Seeks Bankruptcy Protection
Nortel has struggled to recover from the collapse of technology stocks early in the decade as well as an accounting scandal.
OTTAWA — Nortel Networks, the telecommunications company, filed for bankruptcy protection in Canada and the United States on Wednesday.
Wednesday 14 January 2009
TSX Delisting Review - Nortel Networks Corporation
Nortel Commences Comprehensive Business and Financial Restructuring
Investment Industry Regulatory Organization of Canada - Trading Halt - Nortel Networks Corporation - NT (all issues)
2008
Friday 12 December 2008 TORONTO: NORTEL RISKS STOCK EMBARRASSMENT
Nortel Networks Corp., once Canada's most valuable company, says it could be delisted from the New York Stock Exchange. The company says the NYSE has informed it that it has failed the listing requirement because it has traded below US$1 for more than a month. Nortel now has six months to boost its stock value or face delisting.
Thursday 11 December 2008 Nortel explores bankruptcy protection, government aid: report
Shares fall as company says no court filing is imminent
Friday 14 November 2008
Nortel's saviour is already in place
(NT : TSX : $0.91 | NYSE : US$0.75)
Expecting another loss in F09
Scotia Capital maintains a "sector underperform", target of $1.75
TD Newcrest maintains a "hold", lowers target to US$2.25 from US$3.
Nortel Networks is in a heap of trouble. The networking vendor just announced plans to terminate 1,300 workers and prospects for growth are thin after posting a net loss of US$3.4 billion for the third quarter.
Friday 14 November 2008 TORONTO: NORTEL SEEN ON THE ROPES
An analyst with Royal Bank of Canada Capital Markets has suggested that Nortel Networks Corp., the country's biggest high-technology firm, could soon be forced into bankruptcy. Mark Sue has told the Canadian Press that a Nortel bankruptcy is "a distinct possibility." Mr. Sue says that although the company has US$2.65 billion in cash, it is overwhelmed with debt and is trying to function with cash flow problems at a time when "capital markets are basically closed down." The analyst says that in the absence of a government bailout or an investment injection the company could run out of money before bonds worth US$1 billion mature in 2011. Mr. Sue predicts that Nortel stock will at some point be worthless. The shares were trading at 79 cents on Thursday, after dropping to an historic low of 65 cents the previous day.
Wednesday 12 November 2008 (NT : TSX : $1.00 | NYSE : US$0.83)
Q3 shows more restructuring but no news on asset sales
GMP Securities maintains a "reduce", lowers target to US$0.55
Paradigm Capital maintains a "buy", lowers target to $5.00
Tuesday 11 November 2008 TORONTO: NORTEL SHRINKS AGAIN
A prominent Canadian telecommunications company, Nortel, is cutting 1,300 jobs. Nortel CEO Mike Zafirovski says worsening economic conditions, extreme volatility in the financial, foreign exchange and global credit markets have all affected the company. Nortel is also freezing salaries of its remaining staff after suffering a third-quarter loss of $3.41 billion. The layoffs mark the 11th time Nortel has announced layoffs in recent years. Eight years ago, Nortel had 94,500 employees. More than 71,000 have been laid off.
Monday 10 November 2008 Nortel cuts another 1,300 jobs
Beleaguered telecom equipment provider is taking a $3.2-billion charge
Sunday 09 November 2008 (NT : TSX : $1.42 | NYSE : US$1.22)Nortel Q3 preview
Scotia Capital reiterates a "sector underperform", target is $2.60
1389_PeterTrent_Nortel_02.avi HDV 8 Oct 2008 - 3 min Peter Trent OWN talks on the high pay to corp leaders such as Nortel
Video page
Nortel Networks Corp. (NT : TSX : $2.09 | NYSE : US$1.91)
Unwinding Nortel: option of breakup high but key risk is executive decision making
GMP Securities maintains "hold", 12-month target price is US$2.20
Monday 22 September 2008 (NT : TSX : $2.97 | NYSE : US$2.81)Tough environment
Paradigm Capital maintains "buy", 12-month target price is US$15.00
TD Newcrest downgrades to "hold", 12-month target price is cut to US$3.50
Friday 19 September 2008
(NT : TSX : $2.94 | NYSE : US$2.74) Low margin of safety for investors
GMP Securities maintains a "reduce", lowers target to US$2.40
Paradigm Capital maintains a "buy", lowers target to US$15.00 from US$23.00
Scotia Capital downgrades to a "sector underperform", target of $3.10
Wednesday 17 September 2008 Nortel Networks (NT) lowered its Q3 and FY2008 outlook as customers cut back capital expenditures. Nortel is seeing additional pressure on revenue due to foreign exchange impact and certain product delivery delays from the third quarter into the fourth quarter. Quarterly revenues are expected to be US$2.3 billion vs. consensus and RBC CM estimates of US$2.7 billion.
Friday 05 September 2008 (NT : TSX : $6.33 | NYSE : US$5.95)
Announced a pair of optical contract wins
Paradigm Capital maintains a "buy", target of US$23.00
Monday 25 August 2008 Nortel buys audio technology firm
Company paying up to $10-million for Mesa, Ariz.-based DiamondWare Ltd., whose software is used by both the gambling industry and the U.S. military
Wednesday 06 August 2008 (NT : TSX : $6.42 | NYSE : US$6.15)
Q2 weak: Revenue o.k, losses high and orders down 20%
Credit Suisse First Boston maintains "neutral", 12-month target price is US$7.00
GMP Securities reiterates "reduce", 12-month target price down to US$5.60
Tuesday Aug 5, 2008 Nortel buys Novera
Nortel Networks has made its first acquisition in several years with the purchase of Novera Optics, a California company...
Nortel Networks (NT : TSX : $6.67)
Net Change: -1.18, % Change: -15.03%, Volume: 7,455,489 Heading south? North America's biggest maker of phone gear fell the most in four years after posting weak quarterly results. Nortel said its net loss widened to $113 million, or $0.23 per share, from $37 million, or $0.07 per share, a year ago. Excluding items, the loss was only $0.11 per share, yet analysts were looking for $0.02. Nortel took large restructuring charges as well as currency exchange writedowns during the period. Adding to its difficulties, the company said that a big North American customer had "shut the door" on capital spending in the near term. Sprint Nextel (S) has been fingered as this entity, with American Technology Research astutely noting, "[Nortel] is getting whacked by Sprint." Pavi Binning, Nortel's CFO, declined to verify if this was indeed true. Management did affirm that it was on track to hit a previous forecast of low-single-digit percentage sales growth. However, this projection includes around $350 million in deferred revenue from previous contracts, and is somewhat misleading.
Offering its two cents, Robert Baird & Co. said, "If you strip that out,the numbers don't look as good...This quarter, we would say, is kind of artificially high because we were not expecting deferred revenue recognition." So where does this leave Nortel? CEO Mike Zafriovski suggested that "...consolidation would be good for the industry and for customers." When asked whether he plans to further reduce headcount to cut costs, he added, "There's no restructing announcement planned as of now." I guess we'll just have to wait and see.
Sunday 03 August 2008 TORONTO: NORTEL HAS GOOD, BAD NEWS
Nortel Networks Corp., Canada's biggest high-technology company, says it's hitting its revenue targets although it continues to lose money. The company says its second-quarter revenue came to US$2.62 billion, up two per cent from a year earlier but down slightly from the first quarter. However, Nortel lost US$113 million, compared with a year-ago loss of US$37 million. Before the high-tech bubble burst several years ago, Nortel stock was trading as high as US$127. Since then it has suffered an accounting scandal that culminated in the charging of former CEO Frank Dunn and two other former executives with fraud. The stock was trading on Friday after noon at $6.65, down 15 per cent.
Saturday Aug 2, 2008 Nortel loss triples in Q3
Nortel Networks Corp. said yesterday its quarterly loss tripled on restructuring charges and currency exchange losses, and...
Friday Aug 1, 2008 Nortel's quarterly loss triples
TORONTO - Nortel Networks Corp. on Friday reported a second-quarter net loss of $113 million, or 23 cents a share, as restructuring charges and currency exchange losses weighed, the company said.
Nortel quarterly loss triples
Telecommunications equipment maker says it is on track for 2008 targets
For the three months ended June 30, revenue was $2.62-billion (U.S.), compared with $2.56-billion for the second quarter of 2007. Analysts surveyed by Bloomberg had forecast sales of $2.5-billion.
Monday 28 July 2008 (NT : TSX : $7.38 | NYSE : US$7.20)
Flextronics results positive for Nortel
Paradigm Capital maintains "buy", 12-month target price is US$23.00
Thursday 24 July 2008 (NT : TSX : $7.20 | NYSE : US$7.12)
Foundry deal highlights Nortel valuation
Paradigm Capital maintains "buy", 12-month target price is US$23.00
Wednesday 23 July 2008 (NT : TSX : $6.76 | NYSE : US$6.72)
Completed wireless spectrum auction; raising $4.25b
Paradigm Capital maintains "buy", 12-month target price is US$23.00
Friday 11 July 2008 (NT : TSX : $6.89 | NYSE : US$6.81)
Nortel focusing on growth markets in metro Ethernet and 4G
Paradigm Capital maintains "buy", 12-month target price is US$23.00
RBC Capital Markets maintains "sector perform", 12-month target price is US$8.00
Wednesday 25 June 2008 (NT : TSX : $8.97 | NYSE : US$8.85)
Equity is valued close to a third of what it was less than a year ago
Dundee Securities maintains "not rated", no target price reported
Monday Jun 23, 2008 Nortel payout: windfall or taxable?
Tax treatment of the Nortel settlement and inheritances from other countries were among the topics submitted in the latest...
Friday 20 June 2008 TORONTO: FORMER NORTEL CEO CHARGED
Federal police have brought criminal charges against former Nortel Networks Corp. CEO Frank Dunn and two other former financial executives of the telecom for fraud. Mr. Dunn is charged with fraud affecting public securities, falsification of accounts and the issuance of a false prospectus. Former Nortel CFO Douglas Beatty, and former corporate controller Michael Gollogly face similar accusations. The Royal Canadian Mounted Police allege that between early 2002 and mid-2003 the accused fraudulently misstated Nortel's financial results. When the accounting scandal became public, Nortel stock plunged from above $400 to $9.71 in trading on Thursday. The company fired Mr. Dunn and was forced to sell assets and lay off more than 60,000 employees.
Tuesday 17 June 2008 How does Nortel spell wireless relief? LTE
When Nortel executives hosted an analysts day, among the information offered were some financial details of the wireless business
Friday 13 June 2008 Nortel eyes growth in new technologies
Senior executives say they have made bold bets on emerging technologies that will enable company to leapfrog some rivals
(NT : TSX : $10.70 | NYSE : US$10.48)Reiterated revenue guidance, moving away from WiMax
Paradigm Capital continues "buy", 12-month target price is US$23.00
RBC Capital Markets continues "sector perform", 12-month target price is US$8.00
Nortel Networks Corp. (NT : TSX : $8.74 | NYSE : US$8.58)
Nortel to provide Provider Backbone Transport carrier technology to Verizon
Paradigm Capital maintains "buy", 12-month target price is US$23.00
Thursday 12 June 2008 Nortel Networks (NT) - $9.20 - Just A Little Respect Please
Sector Perform, Speculative Risk, Price Target: $8.00
Nortel is trying to put its best foot forward and look ahead following numerous disappointing years of underperformance. With a mostly revamped management team, the company is attempting to grow its top line and emphasize operating margin improvements. Nortel reiterated its revenue guidance of low single digit top line growth at its analyst day yesterday. Gross margins are pegged near ~43% with operating margin improvements of 300bps YoY (~6.7%). Metro Ethernet and the Enterprise segment remain key initiatives. Nortel is attempting to shift its portfolio to growth markets and believes it can expand its addressable market by $20B (50/50 products/services) by 2011. There will be some bumps along the way and Nortel expects the CDMA and GSM markets to contract by 4% and 8% over the next four years. This means Nortel's wireless revenues may decline near 35 per annum over the same time period. And if Nortel is to take part in the large LTE builds, it may have to make some price concessions. Add it all up and Nortel may see improving top line metrics and meaningful earnings growth. Progress will not come without challenges and the company to date has been very inconsistent with its execution. And with industry structure keeping a lid on Nortel's ability to accelerate the top line and reach its long term operating margins, RBC CM maintains a wait and see approach.
Wednesday 11 June 2008 Nortel Networks (NT) reaffirmed its guidance for 2008, with revenue to grow in the low single digits year-over-year. Gross margins are expected to be about the business model target of 43% of revenue, and operating margin as a percentage of revenue is expected to increase by about 300 basis points year-over-year.
Monday 09 June 2008 (NT : TSX : $7.82 | NYSE : US$7.66) Encouraging Q1 results
Paradigm Capital maintains "buy", 12-month target price is US$23.00
Nortel keys on new growth areas
Company to place emphasis on improving product delivery and undercutting Cisco sales
Wednesday 21 May 2008 Nortel raising $500-million in notes
Telecommunications equipment maker confirms its 2008 guidance, including “low-single-digit” percentage sales growth
Tuesday 13 May 2008 (NT : TSX : $8.18 | NYSE : US$8.15) Deferred revenues help Q1/08 results
BMO Capital Markets maintains "market perform", 12-month target price is cut to US$11.00
Friday 02 May 2008 (NT : TSX : $8.87 | NYSE : US$8.70)
Mixed results anticipated, leverage to come from SG&A improvement
RBC Capital Markets maintains "underperform", 12-month target price is US$7.00
TD Newcrest maintains "buy", 12-month target price is US$13.00
Nortel loss widens to $138-million
Telecommunications equipment maker saw revenue increase by 11%; maintains full-year guidance
Friday 11 April 2008 Nortel Networks (NT : TSX : $7.42), Net Change: 0.16, % Change: 2.20%, Volume: 2,233,347
"They're tryin' to make me go to rehab. I said 'No', No'-tel'." - Amy Winehouse(ish). An analyst said that North America's
largest telephone-equipment maker (believe it or not) could tack up over 35% in value if it sold its wireless business where the
analyst believes profits have peaked. This would allow them to concentrate on its wireline and enterprise-solutions units. The
analyst, quoted by Bloomberg, was said to believe the sum-of-parts would be worth $10 per share.
Wednesday 26 March 2008
Nortel Networks (NT : TSX : $7.00), Net Change: 0.33, % Change: 4.95%, Volume: 5,256,808
Proof they’re not a flash in the paneer. Nortel was awarded two wireless contracts yesterday. The first is from India’s BSNL
(Bharat Sanchar Nigam Ltd.), the country’s largest telecom service provider, with more than 20 million cellular subscribers.
Under the US$100 million-plus deal, Nortel will support BSNL’s GSM rollout in southern India. This network expansion is
already underway and is expected to be completed towards the end of 2008. The second contract was awarded by U.S. Cellular,
the sixth-largest wireless company in the U.S. The carrier will use Nortel’s CDMA technology to beef up its network. No
financial details were provided but U.S. Cellular will buy Nortel’s CDMA switching, base stations and software. The two
contract wins came at a time when analysts are sceptical about Nortel’s outlook in 2008. They may change their opinions if
Nortel continues to win contracts in this prevailing challenging carrier capex growth and pricing environment.
TORONTO: NORTEL WINS $100-MILLION INDIA CONTRACT
Nortel Networks Corp., Canada's biggest high-technology firm, has won a contract worth more than $100 million with the Bharat Sanchar Nigam Ltd. group, India's biggest provider of telecommunications services. Nortel will supply its customer with wireless solutions in southern India. BSNL is developing the extent and capacity of its wireless network to satisfy growing demand for cellular telephones in India. Nortel and BSNL have been business partners since 2004.
Tuesday 25 March 2008 Nortel Networks (NT) - U.S. Cellular has awarded Nortel a five-year contract to provide advanced wireless capabilities that deliver high-quality mobile voice and data services while easily supporting addition of new subscribers. The deal builds on Nortel and U.S. Cellular's long-standing relationship for supplying CDMA solutions. .
Tuesday 18 March 2008 Nortel Networks (NT) - The U.S. Social Security Administration has confirmed selection of a team led by Nortel Government Solutions to deploy one of the world's largest enterprise VoIP networks under the 10-year, US$300 million Telephone Systems Replacement Project.
Wednesday 12 March 2008
Nortel (NT) is introducing the industry's first optical technology that can deliver both 40G and 100G network capacity, enabling four times the network throughput immediately while providing the foundation to simply and affordably increase capacity tenfold as required.
Sunday 02 March 2008 (NT): $11.45 – It's Not Getting Better
Nortel announced that revenues declined 4% Y/Y to $3.2B, modestly below consensus of $3.24B. Nortel is projecting revenue growth in the low single digits vs. most expectations of mid single digit growth this year.
Thursday Feb 28, 2008 Nortel to cut 2,100 jobs as quarterly loss widens
Nortel Networks Corp. reported a bigger fourth-quarter loss yesterday because of a $1.1-billion tax charge and said it will...
TORONTO: NORTELS SHEDS MORE JOBS
A prominent Canadian technology company, Nortel, is laying off 2,100 employees and transferring 1,000 people from its Toronto office to other locations. The move comes after the company had a fourth-quarter loss of $844 million. Nortel stock fell 12 per cent on the Toronto Stock Exchange after the announcement. The staff cuts are expected to reduce costs by $275 million a year.
Sunday Feb 24, 2008 Nortel execs put on notice
The RCMP is set to file criminal fraud charges against former senior executives at Nortel Networks Corp...
Thursday Feb 14, 2008 Nortel is ready for acquisitions
Nortel Networks' chief executive will examine potential takeover opportunities when they arise, he told a German newspaper, but he declined to comment on media reports of a unit merger with Motorola. "We are becoming more visible in the market again and can rely on organic growth again. But if the right opportunity for an acquisition arises, we will, of course, look at it. I can't say more on the issue of Motorola," Mike Zafirovski said.
Tuesday Feb 12, 2008 Nortel, Motorola reported to be working on wireless pact
Nortel Networks Corp. and Motorola Inc. are working on a deal to combine wireless-networking gear in a bid to get back into...
(NT-N, NT-T) US$11.16 Chris Umiastowski, P. Eng., MBA,
ACTION LIST BUY (Unchanged);Target: US$28.00 (Unchanged)
Could We See Nortorola?
Monday 11 February 2008 Nortel, Motorola in talks to combine units: report
Wall Street Journal says talks could create joint venture with sales of around $10-billion
Monday 11 February 2008 Nortel Networks (NT) - The Wall Street Journal is reporting that Nortel and Motorola are in talks to combine their wireless-infrastructure units in a joint venture, said people familiar with the situation, the latest response to slowing growth in the telecom-equipment industry. If consummated, the talks will create a joint venture that likely will have sales of about US$10 billion, combining businesses that make network equipment for wireless phone carriers.
Wednesday 16 January 2008 (NT-N, NT-T) US$12.42
ACTION LIST BUY ^ (Prior:BUY);Target: US$28.00 (Unchanged)
Thursday 10 January 2008 RBC (NT): $12.73 - Navigating The Challenging Seas
Sector Perform, Above Average Risk, Price Target: $16.00 (prev. $18.00)
The New Year may bring certain growth opportunities for Nortel and considering incremental progress made thus far in streamlining operations, RBC CM is counting on a faster rate of improvement on Nortel's bottom line this year. Shares may look attractive trading at 11X consensus CY09 earnings of $1.23. Many challenges remain however: Nortel's marginalized position in a consolidating industry, the growth surge from new entrants, and Nortel's weak balance sheet. Considering that Nortel is now entering its eighth year of restructuring, RBC CM maintains its neutral stance. In addition to Nortel's potential earnings growth (which predominately will come from opex reductions) investors may focus also on the company's balance sheet, which remains weak. A negative cash balance will continue to hamper Nortel's ability to get out of its current conundrum. Despite the growth in subscribers, the wireless infrastructure may show only modest growth and North American CDMA spending may actually contract in 2008 before the larger upgrade to LTE occurs a few years from now.
2007
Wednesday 28 November 2007 (NT : TSX : $16.87)
40G optical technology should allow for higher margins
Scotia Capital maintains a "sector outperform", target of $30.50
Monday 19 November 2007
- Nortel held its Analyst Day yesterday in Toronto.
>br>What It Means
- Key Areas of Growth Look Promising: Nortel suggested that its current addressable market
could grow at a 6% CAGR from the $291B in 2007 to $346B by 2010. But R&D
investments are highly skewed to the high growth areas which are expected to grow at a
45% CAGR from $11B to $35B by 2010. We believe a number of initiatives show that
Nortel is placing big bets on UC, 4G (LTE/WiMax), PBT and 40G Optical.
- Business Transformation Delivering Cost Savings Above Expectations for 2007: The
Company had initially expected to deliver US$750M in savings from its business
transformation initiative in 2007 but now sees that number at US$855M.
- Reiterate 1-SO rating: Our thesis of a steady to slightly growing top line, improving gross
margin and declining opex was re-enforced by management's presentations yesterday.
Although nothing shocking was delivered during the day management's confidence was
noticeable.
Thursday 15 November 2007 UNDATED: FIRED NORTEL EXECS REJECT U.S. SECURITIES ACCUSATIONS
Two former executives of Canada's biggest high-technology firm, Nortel Networks Corp., have filed documents rejecting the accusations brought against them by the U.S. Securities and Exchange Commission in a civil fraud suit. Former CEO Frank Dunn and former CFO Douglas Beatty denied in separate filings that they engaged in accounting fraud to be awarded performance bonuses illicitly. Nortel fired both executives three-and-a-half years ago. The SEC alleges that eight Nortel executives either exaggerated accounting of financial results in 2000 or used reserves to improve profits report in a fraudulent accounting maneuvre. The SEC is seeking financial penalities and director bans. But Mr. Dunn and Mr. Beatty say the accounting was the result of error not fraud. The year 2000 was that of the worldwide high-technology meltdown. Nortel's accounting scandal exploded in 2004.
Thursday 08 November 2007 (NT : TSX : $17.10 | NYSE : US$18.46)
Q3 beats expectations
BMO Capital Markets maintains "market perform", 12-month target price is cut to $22.00
Wednesday 07 November 2007 Nortel Networks (NT) gained the most in more than two years after
swinging to a third quarter profit and predicting a “very solid” fourth
quarter, although revenue fell slightly short of expectations as the company
ran into problems filling some orders.
(NT : TSX : $17.75), Net Change: 2.52, % Change: 16.55%, Volume: 5,193,639
“Get that $130 offer out again, Grandma.” Nortel stock rallied yesterday as the company reported Q3 results, posting $0.05
per share of earnings. While missing consensus forecast of $0.11 EPS, the results seemed to delight the market, as the company
posted its first profitable quarter since Q2/06, which itself had broken a seven-quarter streak of losses. Revenues declined by 8%
to $2.7 billion, as some revenues were deferred, with the company facing difficulty fulfilling some customers orders with the
transition of its CDMS manufacturing centre. Management guided for Q4 revenues to be flat with a slight improvement in
gross margins. While these results seemed to renew some hope, the stock is still down about 50% on the year.
(NT-N, NT-T) US$19.18 Chris Umiastowski, P. Eng., MBA, 416 983 3599
BUY (Unchanged);Target: US$28.00 (Unchanged
Q3 Results: Gross Margins Rock Solid; SG&A Weak
Tue 06/11/2007 Gains, lower costs help Nortel to profit
Telecommunications gear maker made $27-million for the third quarter; had to defer some revenue because of challenges in fulfilling orders
Research In Motion (RIM) briefly overtook Royal Bank (RY) as Canada’s biggest company by market value on
Tuesday. The maker of Blackberry e-mail, worth about $68 billion, became the first technology enterprise to take
the top spot since Nortel Networks (NT) in 2000. At their peak, Nortel shares accounted for more than a third of
the S&P/TSX Composite’s value. In contrast, Research In Motion currently makes up less than 4% of the
benchmark’s $1.69 trillion capitalization.
Wednesday 17 October 2007
Nortel Networks Corp. (NT : TSX : $15.71 | NYSE : US$16.07)
Settlement reached with SEC
GMP Securities maintains a "buy", target price is US$29.00
RBC Capital Markets maintains a "sector perform", target price is US$18.00
Tuesday 16 October 2007 TORONTO: NORTEL RESOLVE U.S. REGULATORY DISPUTE
Canada's biggest high-technology firm, Nortel Network Corp., says it has wound up all accounting issues with the U.S. Securities and Exchange Commission. Nortel says it will pay a civil penalty of US$35 million and will provide the Commission with quarterly reports about how it is working to solve continuing internal difficulties with controls. CEO Mike Zafirovski says the settlement amounts to recognition of the efforts by the board of directors and senior management to identify and solve accounting problems.
Tuesday 16 October 2007 Nortel Networks (NT) - The U.S. Securities and Exchange Commission's most vocal opponent of company fines dismissed a US$35 million penalty imposed on Nortel Networks Corp. as a ``public relations gesture.''
Nortel Networks (NT) - $16.84 - Settles with SEC Sector Perform, Above Average Risk, Price Target: $18.00 The SEC inquiry into Nortel’s accounting scandal has concluded with formal investigation resulting in a monetary fine of $35 million. Although the $35 million fine has already been reserved, it is not something that Nortel can afford considering its ($1.1 billion) net cash balance. Nortel is being charged with two accounting and fraud schemes related to its revenue and earnings reports for 2000, 2002 and 2003 and the charges claim that the accounting schemes enabled Nortel to meet unrealistic guidance provided during those years. Nortel is expected to report its third quarter results in the first week of November, and RBC CM is expecting the results to be in-line with its forecasted revenue and EPS of $2.7 billion and $008, respectively, versus consensus of $2.8 billion and $0.05. RBC CM expects that Nortel’s stock may display some stabilizing trends as the company shows firming revenues, executes on its cost-cutting plan and firms up its regional management team.
Friday 12 October 2007 Nortel Networks (NT) - $16.44 - Honey, They Shrunk The Multiple
Sector Perform, Above Average Risk, Price Target: $18.00 (was $22.00)
The market for telecom equipment and enterprise networking is strengthening, but Nortel still lacks a competitive product offering in numerous segments and also lacks the broad scale to compete at a global level. And although Nortel is making large bets in new growth opportunities in WiMax, 4G, and PBT, revenues from these segments may not impact the P&L for some time. Near term, the company is working to improve its cost structure and margins, but progress has nonetheless been slow. From the outside looking in, it appears that Nortel will soon be entering its seventh year of restructuring. Directionally, Nortel may see some baseline trends in its optical segments and growth in its enterprise segment, but a potential decline in its remaining GSM segment. Furthermore, considering the near completion of the EVDO upgrades at Verizon and Sprint, the CDMA infrastructure market may not grow meaningfully next year. Nortel's stock may display some stabilizing trends as the company shows firming revenues, executes on its cost cutting plans, and firms up its regional management team. Duration risk remains for Nortel, so investors taking a look at the stock at current levels must have a multi-year horizon.
Friday 12 October 2007 Nortel Networks Corp. (NT : TSX : $15.93 | NYSE : US$16.31)
Shares' mulitiple continues to contract
RBC Capital Markets maintains "sector perform", 12-month target price is cut to US$18.00
Friday 28 September 2007 Nortel Networks (NT) - Citing an internal memo, the Globe & Mail reports that on Wednesday, Nortel's cutting edge network at the New York Times shut down for more than three hours, leaving reporters and other employees without phones and email. The Globe & Mail adds that the Times was able to work around the issues and managed to get the paper out without a long delay.
Monday 17 September 2007 Nortel Networks Corp. (NT : TSX : $17.48 | NYSE : US$16.99)
Lowering 2007 outlook on weaker North American demand
GMP Securities maintains "buy", 12-month target price is $29.00
Thursday 13 September 2007 TORONTO: SEC LAYS MORE NORTEL ACCUSATIONS
The U.S. Securities Exchange Commission has laid new charges of accounting fraud against four former executives of Nortel Networks Corp. The SEC claims that Douglas Hamilton, Craig Johnson, James Kinney and Kenneth Taylor manipulated $44 million worth of reserves to alter Nortel's balance sheet. The four were vice-president in the optic fibre, wireless, conventional telephone and customer service divisions. In March, the SEC laid several charges against other former Nortel executives, including former CEO Frank Dunn. Sept. 12 (Bloomberg) -- The U.S. Securities and Exchange Commission sued four ex-finance officers at Nortel Networks Corp., alleging they helped former Chief Executive Officer Frank Dunn manipulate reserves to boost earnings.
Wednesday 05 September 2007 Nortel Networks (NT) - US$17.77 - Longer Term Issues Remain but Near Term Trends Firming
Sector Perform, Above Average Risk, Price Target: US$28.00
Bookings growth appears to be improving in wireless, and RBC CM believes it is healthy enough to meet published top line estimates in the near term. Several segments remain on plan for Nortel to meet revenue estimates for Q3 and Q4, as CDMA (code division multiple access) upgrades remain solid. In addition, NT’s partnership with Microsoft may be improving, helping both companies share channel development. RBC CM believes NT may need to reposition itself in the consolidating industry, and may require some major strategy rethink to differentiate itself against the larger players. RBC CM believes that NT is an investment appropriate only for long-term minded investors.
Nortel Networks Corp. (NT : TSX : $18.25 | NYSE : US$17.30)
Challenges remain, but improvements being seen
RBC Capital Markets maintains a "sector perform", target price is US$28.00
Saturday 04 August 2007 TORONTO: NORTEL STOCK PLUNGES
Nortel Networks Corp. stock plunged as much as eight per cent on Thursday after Canada's biggest technology firm announced a second-quarter loss of US$37 million and an eight-per cent decline in revenue. The loss contrasts with earnings of $342 million a year earlier. Nortel stock closed at C$21.57. CEO Mike Zafirovski attribute most of the decline in revenue to the divestiture of the company's UMTS Access unit. He predicts a full-year profit of about five per cent.
Friday 03 August 2007 Nortel down but not out
Us$37-Million Loss; Zafirovski Vows Better Days Ahead; Analyst Agrees
Nortel slides on weak results
Loses $36 million. Results hurt by lower revenue, layoff expenses
Wednesday 18 July 2007 rbc Nortel Networks (NT) - $24.33 – Short Term Beta Parking
Sector Perform, Above Average Risk, Target Price: $30.00
Shares of NT have underperformed over the year, and RBC CM believes there is limited downside to current levels. In addition, the telecom equipment outlook is displaying firming trends, leading to a reasonable risk/reward scenario. RBC CM believes challenges remain for the company, and expects a pause in CDMA wireless spending during Q2, however remains encouraged by the company’s attempts to streamline operations and bring its financial model closer to its peer group. RBC CM continues to rank Nortel Sector Perform, Above Average Risk with a $30.00 price target.
Sunday 10 June 2007 rci NEW YORK: NORTEL REPORTED IN DEEP TROUBLE WITH U.S. REGULATOR
The Bloomberg News financial new service reports that the U.S. Securities and Exchange Commission is ready to impose a huge fine on Canadian high-technology firm Nortel Networks Corp. According to the agency, the SEC last month approved a maximum fine of $100 million for Nortel for accounting fraud. The SEC hasn't confirmed the report on the grounds that no court action against Nortel has yet been filed. Nortel also declined to confirm Bloomberg's report. The SEC has been investigating Nortel's accounting since 2004. The company has acknowledged having inflated its declared revenue by US$3.4 billion. Nortel has already agreed to pay more than $2 billion to settle class-action suits brought by investors who bought its stock at times when its financial statements were erroneous. Two weeks ago, Nortel agreed to pay the Ontario Securities Commission $1 million to defray the expense to which it had gone to investigate the company's accounts. But the OSC's allegations of securities law violations are still pending.
Friday 08 June 2007 SEC to fine Nortel over accounting fraud: report
U.S. securities regulators are planning to fine Nortel Networks Corp. up to $100-million for accounting fraud, according to Bloomberg
rci 22 May 2007 TORONTO: NORTEL, OSC REACH SETTLEMENT
Nortel Networks Corp. and the Ontario Securities Commission have reached a settlement in connection with the company's multifarious accounting problems of recent years, a settlement which Nortel says "fully resolves all issues between Nortel and the OSC." Under the terms of the accord, Nortel will pay the OSC $1 million in investigative costs but won't suffer any administrative penalty or fine. Nortel CEO Mike Zafirovski says the OSC recognizes the efforts made to strengthen the company through a restructured ethics policy, improvement of financial processes and the settlement of shareholder class-action lawsuits.
Thursday 17 May 2007 Nortel may have pact with OSC
Nortel Networks Corp. has reached a tentative settlement with staff of the Ontario Securities Commission who allege the company's financial statements in 2000 and parts of 2002 and 2003 violated Canadian and U.S. accounting principles.
Sunday 13 May 2007 Nortel sees upside in past woes,br>
John Roese, the company's new chief technology officer, says Nortel was focused in recent years on wading through its financial problems, accounting scandals, and cutbacks, and didn't have time to pare its product portfolio.
Monday 07 May 2007 Nortel posts smaller loss
First-quarter shortfall amounts to 23 cents a share on higher revenue; analysts had expected loss of 32 cents a share
..The company posted a loss of $103-million (U.S.), or 23 cents per share, compared with a loss of $171-million, or 39 cents per share, during the same period a year ago
Wednesday 02 May 2007 NORTEL NETWORK(NT)US$23.07 – THESE NUMBERS AREN’T SO BAD. RATING: SECTOR PERFORM. TARGET: US$30.00. RISK RATING: ABOVE AVERAGE. INDUSTRY RATING: UNDERWEIGHT.
Late yesterday, NT released some preliminary Q1 results (ahead of today’s AGM). Revenues of $2.48 ($2.37 expected) for 4% growth (12% organic excluding UMTS y/y). Operating margin only slightly negative – vs. -4% expected. No change in 2007 outlook – flat to down revs, GM just above 40% and operating margin 5% or more. Full Q1 results will still be out Thurs. p.m. The company’s Chief Legal Officer, David Drinkwater, has been appointed interim CFO (Peter Currie stepped down April 30). NT has fared a little better this quarter than its peers. Cash flow from operations was affected by the cash settlement for the lawsuits. This should mean dilution impact is imminent, if not already executed. The stock appears to be pricing in about an 8% 2008 operating margin today. In our view, this is getting into the plausible zone. However, with the current weaker end market signals, lack of CFO, and potential stock overhang from the shareholder lawsuit settlement, we remain somewhat cautious – but are warming up just a bit.
Thursday 29 March 2007
Thursday 29 March 2007 Nortel, Microsoft to expand communications pact
TORONTO — Nortel Networks Corp. and Microsoft Corp. are expanding their existing partnership and will sell jointly developed products to telephone companies that serve business clients.
Tuesday 20 March 2007 Nortel outlook shows recovery won't come quickly
CEO's plan expected to take five years
NORTEL NETWORK(NT)US$26.15 – STILL TRYING TO FIND A PARKING SPOT. RATING: SECTOR PERFORM. TARGET: US$30.00. RISK RATING: ABOVE AVERAGE. INDUSTRY RATING: UNDERWEIGHT.
We are struggling to find a near-term investment thesis for NT. Q1 looks like it will be back in the red, so to reach the (reduced) 2007 operating margin target of 5% implies a strong H2. Recall that NT forecasted (as recently as last June) a 3-5% operating margin for 2006 – yet delivered 0.2%. Forecasting the bottom line is proving to be a challenge, which is a reason for caution with management’s 10%+ OPM forecast for 2008. At US$26, the stock is baking in a 10% operating margin (assuming a 15x P/E, which is generous). Yes, this is below the 10%+ goal, but also well above anything NT or its telecom peers have sustained for any period of time. It’s also quite a big step from the current breakeven level. Longer term, we find the appeal of making a bet on the skills of this management team reasonable. We view Nortel’s current management team as the most focused and experienced the company has had since the Roth days. While we may question their projections and timing for profitability, we can’t fault them for their strategic moves. Although we expect the payoff to come later than management may be hoping, we would endorse their bets on WiMAX, Enterprise with Microsoft, and NT’s optical strength returning. While yesterday’s updated guidance will likely drive consensus numbers lower, we don’t see a need to change our ‘07 $0.50 or ‘08 $1.52 estimate.
Tuesday 13 March 2007 Former Nortel [Frank Dunn] execs face fraud charges
Dunn 'looking forward' to truth coming out
Thursday 01 March 2007 Nortel restating results ... again
Telecom equipment maker has identified ‘certain errors' in pension accounting
Wednesday 07 February 2007 Nortel's bookkeeper packs it in
CFO Currie's departure heralds new tack
NORTEL NETWORKS(NT)US$28.26 –RATING: SECTOR PERFORM. TARGET: US$30.00 (WAS US $22.50). RISK RATING: ABOVE AVERAGE. INDUSTRY RATING: UNDERWEIGHT.
Prelim Q4 results show decent revenues and stronger than expected gross margins (40%), PLUS great cash generation. The Mike Z. team has been busy. We guess Q4 EPS at $0.20. NT announced 2,900 job cuts. While clearly not good news for some employees, this does boost our confidence in the cost-cutting story. We were wondering how they would take G&A from 11% to 5-6% of revs. Now we know. While we are clearly thrilled with the Q4 numbers, we still worry about a few issues: 1) Q4 was boosted by the LG JV and our belief is that much of this is actually UMTS sales in Korea – business that we think has been sold to ALU as of Q1, which may not be sustainable in 2007. 2) The other driver in Q4 was CDMA, which can be extremely lumpy business as both Nortel and Lucent have demonstrated in the past. 3) Nortel deferred the 2007 outlook question. With UMTS sold and GSM in decline we worry about the overall growth picture for 2007 – and you don’t cut jobs when growth is accelerating. 4) More cash costs – $350+ mln more cash needed in 2007 for severance, increasing the likelihood of a dilutive financing. Recall that $1.8 bln of 4.25% debt goes current in Sept. 2007. We are getting at little closer to the Mike Z. program. Nothing like cutting your way to growth! We have raised our EPS estimates to an easy-to-remember $0.50 for 2007 (5% operating margin) and $1.55 (9%) for 2008. We have increased our 2007 EPS and upped our target to US$30.00 reflecting 19x our 2008 EPS of $1.55. Does 19x seems a little aggressive
Yes, but supported by an earnings profile of $0.50 in 2007 and $1.54 in 2008 and since the $1.55 is based on 9% operating margins, there is still room for expansion into Mike Z.’s goal of 13%.
Friday, January 05, 2007 Trading Day with Pat Bolland,
Toe to Toe: Bear vs. Bull: Nortel
Duration:10mn58s
Wednesday 03 January 2007 Nortel Networks has closed the sale of its UMTS business to France's Alcatel-Lucent for 320 million dollars U.S. The deal gives Alcatel-Lucent UMTS's radio access technology along with its product portfolio and customer contracts. About 17-hundred of Nortel's U-M-T-S employees will transfer to Alcatel-Lucent.
2006
Wednesday 27 December 2006 NEW YORK: US JUDGES APPROVE NORTEL SETTLEMENT
Two US judges Tuesday gave final approval to a roughly US$2.25 billion global settlement reached between Nortel Networks Corp. and its shareholders after the Canadian company revised its financial results between 2001 and 2005. US District Judge Loretta Preska said the settlement reached earlier this year was "fair, reasonable and adequate" to compensate people or entities who purchased common stock or sold options on Nortel stock between April 24th, 2003 and April 27th, 2004. US District Judge Richard Berman said a similar deal reached on behalf of as many as 1.4 million investors in the company between Oct. 24th, 2000 and Feb. 15th, 2001 was fair and adequate. Courts in Canada have yet to rule.
Thursday 21 December 2006 TORONTO: NORTEL REVEALS VALUE OF MAJOR U.S. CONTRACT
Nortel Networks Corp. says the contract which it announced in July to supply equipment and services to Verizon Wireless is worth about US$2 billion over five years. The president of Nortel's mobility department, Richard Lowe, says the contract involves helping Verizon expand bandwidth to provide more Internet services, such as user-generated videos, online gaming, music and video. Data services accounted for about 14 per cent of Verizon's revenue from 57 million customers in the third quarter of 2006.
Thursday 07 December 2006
TORONTO: NORTEL SELLS WIRELESS DIVISION
Canadian high-technology firm Nortel Networks Corp. has announced it will sell its UMTS high-speed wireless infrastructure division to Alcatel-Lucent of France for US$320 million. Nortel says it hopes to conclude the transaction to unload the money-losing unit by the end of the year. Nortel CEO Mike Zafirovski said in September that the unit was operating at a loss and that it was better for Nortel to leave a field of endeavour that has too many players.
P>Monday 04 December 2006 Spanish Cable Operator R Delivers New Business Services Enabled by Nortel
Companies Reach Definitive Agreement for the Sale of Nortel's UMTS Access Business to Alcatel-Lucent
Nortel unveils Asia Network Management Centre in India
Thu 30/11/2006 Nortel Networks (NT) - $2.15
Sector Perform, Above Average Risk – Price Target: $2.50 – Driving to Splitville in Reverse
Nortel’s reverse stock split with a 1:10 ratio will take effect tomorrow after which the current share price of $2.15 will open closer to $21.50. While the reverse split results in no structural changes to the company, RBC CM analysis of companies who have recently completed a reverse stock-split suggests that the average share-price may decline up to 8% during the first week. Fundamentally, RBC CM believes it will take time for the company to stabilize the business, increase market share, reduce costs, and ramp new products. The target price and rating remain unchanged and while RBC CM believes there is limited downside potential, it is waiting for meaningful catalysts before it becomes more positive on the stock.
Thursday 16 November 2006 National Bank Financial. TARGET: US$2.25. RISK RATING: SPECULATIVE.
We have just left the nine-hour long Nortel Investor Day and our view is that most attendees were pleasantly surprised with the quality of the new management team and have increased confidence in their ability to deliver costs savings over the next few years. However, questions remain on Nortel’s growth ability and gross margin control. We have more meetings with management today and will have a detailed review out following. This remains a “turnaround” story and these are always difficult to call. The meeting clearly demonstrated Mike Z.’s (CEO Mike Zafirovski’s) ability to attract a stronger team than we have seen at Nortel for some time (perhaps ever), and this team did a good job of demonstrating the much needed GE-like processes they are implementing. The processes outlined by management helped build our confidence in the cost-cutting story. At first pass, we now see a path to a 5-6% operating margin improvement – however, timing, we think, is less certain than management portrayed. Nortel indicated that it hoped to grow at 10% – but when pushed, acknowledged this was for the business ex-UMTS and GSM – a little confusing as Nortel is still in the GSM market. Secondly, its gross margin goal is 43%. From the current 38% we have a little trouble modelling this. The bottom line for us is we still need a few more proof points to assume that the company can hit at least 8% operating margins (let alone 13%).
Saturday 04 November 2006 BEIJING: NORTEL EXPANDS IN CHINA
Nortel Networks Corp., Canada's biggest high-technology firm, has inaugurated a new headquarters in China, the inauguration being president by CEO Mike Zafirovski. He says the headquarters will increasingly be the centre of Nortel's operations in Asia. Mr. Zafirovski also revealed that Nortel's R&D staff has grown by 400 in the past year to 1,800. Some Canadian politicians have criticized the company for shifting jobs overseas. Nine-hundred-and-fifty jobs were cut in 2004, many of them at Nortel's R&D headquarters in Ottawa. Nineteen-hundred other jobs were eliminated last year. Mr. Zafirovski on Thursday didn't exclude the possibility of further job losses in North America, as Nortel looks for new opportunities elsewhere in the world.
Wednesday 01 November 2006 NORTEL NETWORKS(NT)US$2.21 – Q3 PREVIEW; DATAPOINTS MIXED BUT ON THE NEGATIVE SIDE. RATING: SECTOR PERFORM. TARGET: US$2.25. RISK RATING: SPECULATIVE. INDUSTRY RATING: UNDERWEIGHT. NT
Nortel reports Q3 results Tuesday, Nov 7. Expectations are for revenues of $2.8 billion and EPS of $0.01. However we think there are a lot of moving parts that may impact the bottom line. We estimate a loss of $0.01 or breakeven. Q4 outlook expectations are for 10% y/y growth and $0.04. During the quarter Nortel announced it was getting out of the UMTS access (3G) business, selling this business to Alcatel. However the deal will not close until at least December so GSM will still be part of the mix in Q3. After seeing weak GSM/UMTS wireless results at Motorola, Nokia, and Alcatel, slightly offset by some OK numbers at market leader Ericsson, we are nervous about NT’s GSM revenues and outlook – although Cingular core business could help. We also think NT’s remaining GSM business will see pressure as customers are confused about the migration path, similar to what Alcatel and Lucent noted they are experiencing. However Lucent’s strong showing in CDMA gives us some hope NT will see the same. We believe LU’s strength was driven by a shipment of a final EVDO Rev A software load that allowed it to recognize revenue from months of shipments. Nortel could have similar circumstances and this would explain the large deferred revenue account as well as its confidence in revenue growth in the back half. However we caution that NT’s and LU’s CDMA timing is often a quarter or more apart.
Friday, June 30, 2006 The CEO of Canada's biggest high-technology firm, Nortel Networks Corp., says the company doesn't need a merger to survive. Mike Zafirovski told shareholders at the annual meeting that Nortel has been involved in discussions with other parties but won't be involved in a transaction involving poor integration. He says that some of his corporation's own acquisitions in the late 1990s and early 2000 show why they are often a bad idea. Some of Nortel's biggest U.S. customers have in recent years amalgamated. Earlier in the week, Nortel announced the elimination of 1,900 of its 35,000 jobs worldwide in an attempt to again become profitable.
Tuesday Jun 27, 2006
Nortel Networks cutting 1,900
After cutting thousands of jobs over the past five years. Nortel Networks (TSX:NT) is cutting 1,900 more and creating 800 overseas in restructuring moves intended to improve profitability.
Friday Jun 23, 2006 Nortel settles Canadian suits
Nortel Networks Corp. said yesterday that plaintiffs in some Canadian shareholder lawsuits have agreed to a proposed settlement, clearing the way for an earlier agreement reached in the United States.
Thursday Jun 22, 2006 TORONTO: NORTEL SETTLES MORE SUITS
Nortel Networks Corp. has announcement the settlement of two more class-action lawsuits, these in Canada, in connection with its still unresolved financial scandals. The resolution of the Canadian suits was a condition of the eventual settlement of two similar suits in the U.S. The suits concern two periods ending in 2001 and 2004 during which the value of Nortel stock plunged precipitously. Nortel says it has now settled "most" pending and proposed shareholder class actions. The settlement of the four suits are subject to court and regulatory approval.
Friday Apr 7, 2006 rci A former CEO of Nortel Networks Corp. who was fired is refusing to co-operate with the Ontario Securities Commission, which is investigating him. A lawyer representing Frank Dunn has asked Ontario Superior Court to forbid the OSC to question his client for fear it would divulge his testimony to the U.S. Securities Exchange Commission, which also is investigating him. For its part, the U.S. justice department is conducting a criminal investigation of Mr. Dunn. His lawyer says the Canadian Charter of Rights protects him from self-incrimination. The same court rejected a similar demand by former newspaper magnate Conrad Black last year. Nortel fired Mr. Dunn and several other executives in April 2004 after accusing them of rigging the company's accounts to trigger a bonus plan. Shareholders filed several class-action suits against Nortel, two of which it settled out of court earlier this year by paying $2.5 billion US in cash and shares.
Saturday Mar 18, 2006 rci Nortel Networks Corp., Canada's top high-technology firm, says it will pay $228.5 million US as a first payment to settle a shareholder class action suit. The suit was brought in a court in New York. As part of the court settlement, the Canadian firm has committed itself to changes in management practices. The shareholders brought their suit in the wake of the accounting scandal two years ago that led to the dismissal of Nortel's CEO, Frank Dunn, and several other executives. The total sum demanded by the shareholders involved in the suit is $575 million US. To settle finally, the plaintiffs are demanding a combination of cash and shares that would amount to 14.5 per cent of Nortel's equity.
Thursday Mar 16, 2006 rci Nortel Networks Corp. has issued a statement saying that its latest accounting woes aren't attributable to improper conduct. Nortel says that the accounting problems which it acknowledged on Friday are being investigated both internally and independently but that the investigators don't suspect wrongdoing. Nortel said on Friday that it will have to restate its financial results for 2003, 2004 and the first nine months of last year. Two years ago, Nortel fired its former CEO, Frank Dunn, and several other executives in the wake of an accounting scandal.
Sunday Mar 12, 2006 Nortel posts $2.21-billion loss
Network equipment maker has stunning Q4 loss and says it will restate previous results yet again
Thursday Feb 16, 2006 Nortel borrows $1.3-billion
Friday Feb 10, 2006 ec Nortel Networks said it had reached a tentative settlement in two class-action lawsuits stemming from an accounting scandal that brought down senior executives at the firm. The Canadian telecoms-equipment maker will take a charge of $2.47 billion to cover the cash-and-shares agreement.
Thursday Feb 9, 2006 globe Nortel agrees to $2.5-billion (U.S.) settlement
2005
Saturday Jan 21, 2006 globe
Wednesday Jan 11, 2006 ew Nortel Appoints Ex-GE Exec as Global Services VP
Nortel Networks has appointed a former General Electric
executive, Don McKenna, as its new vice-president of global
manufacturing services.
Tuesday, July 27, Nortel Update,
Stephen Kamman, networking & data infrastructure .
Duration:7m 9s
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