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Apple Bid Against Google

U.S. antitrust regulators gave Apple approval to buy certain assets to be sold by bankrupt telecom maker Nortel Networks Corp and the  patents cover wireless, data and optical networking, voice, Internet, semiconductors and other technologies. Google offered more than $900 million for the patent portfolio from the bankrupt Canadian telecom-equipment maker in April and would be given the right to terminate Nortel’s existing agreements if it acquires the patents……….

 

While the US Justice Department cleared Google to bid for Nortel Networks’ 6,000-plus patents last week and no one believed Google would get a shot at that wireless networking treasure trove uncontested, but the rival bidders had yet to be revealed until now. California-based Apple has won a green light to participate in the bidding and the Antitrust Division will continue to review any anticompetitive issues that could arise if an agreement is reached. Nortel is a Canadian phone-equipment maker that filed for bankruptcy in Wilmington, Delaware, in January 2009, agreed to sell about 6,000 patents to Google Inc. (GOOG) for $900 million unless a competitor bids more at a June 27 auction. Nortel, based in Mississauga, Ontario, delayed the auction for a week, citing a significant level of interest in a June 16 statement. “Even though these big companies are under scrutiny by antitrust regulators, they are not routinely being slowed or blocked in their expansive ventures,” said Rebecca Arbogast, a Washington-based analyst with Stifel Nicolaus & Co. “The Nortel auction is a great treasure trove, and this will help companies gain patents for offensive expansion and as a defense against patent suits.”

 

For the auction to take place, at least one competitor needed to top Google’s bid by at least $29 million by June 13, according to rules approved by U.S. Bankruptcy Judge Kevin Gross. Nortel attorney Lisa Schweitzer declined to say how many, if any, bidders offered to pay more than Google. The company doesn’t plan to make any information about the bidding public until after it picks a winner, Schweitzer said in an interview this week. Bidding will take place in the law offices of Nortel’s U.S. law firm, Cleary Gottlieb Steen & Hamilton LLP, where the biggest auctions for Nortel’s assets have been held during the company’s bankruptcy. Some past auctions lasted more than 24 hours, with several rounds of bidding. The sales raised about $3 billion to pay Nortel creditors. Ericsson AB bought Nortel’s wireless-equipment business in 2009 for $1.13 billion after six rounds of bidding that included Nokia Siemens Networks and MatlinPatterson Global Advisers LLC. Last year, Ciena Corp. acquired Nortel’s optical-networking business for $773.8 million in cash. The patent portfolio will give the winning bidder rights to control and license technologies including wireless video that may be valuable for future generations of smartphones such as Apple’s iPhone and Research In Motion Ltd. (RIM)’s BlackBerry.

 

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