Nortel Networks will sell its Multi Service Switch business to private investors for US$39 million in cash.
The deal includes Nortel's North America, Caribbean and Latin America (CALA) and Asia Multi Service Switch (MSS) business and the assets of the Europe, Middle East and Africa (EMEA) portion of its MSS business. The buyer is PSP Holding LLC, a special purpose entity to be fully funded at closing by Marlin Equity Partners and Canadian based Samnite Technologies Inc.
Nortel's MSS business consists of its Data Packet Network and Shasta product groups and associated intellectual property. Nortel expects all MSS employees would have the opportunity to continue employment with PSP as envisioned by the sale agreement.
Commenting on the announcement, John Luszczek, General Manager of Nortel's MSS business said: "Today's announcement is welcome news to all MSS customers, suppliers, partners and employees. The proposed transaction represents a clear and positive step forward and is a testament of our continued commitment to innovation and customer support that resulted in the creation of the business value evident by today's announcement. Throughout this process we will remain focused on providing our customers with the highest level of service, support and responsiveness that they have come to expect."
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- In 1999, Nortel Networks acquired Shasta Networks, a start-up based in Sunnyvale, California, for $340 million in stock and cash. Shasta has developed a new class of service-enabling gateways and subscriber policy management systems for the "subscriber edge" of business IP networks.
