After months of rumors, Avaya has finally struck a deal to buy Nortel Enterprise Solutions, the bankrupt Canadian company’s enterprise division whose assets include its voice and unified communications portfolio and its Ethernet enterprise networking business. Avaya has agreed to pay $475 million for the division. It had been rumored to be offering $500 million. Siemens/Enterasys was another rumored bidder for the business.
Nortel, despite the bad press surrounding its financial collapse, remains one of the leading global vendors of enterprise networking equipment. It has a significant install base and access to those customers is appealing to other network equipment vendors. Avaya, however, is a leading vendor of enterprise voice and unified communications with no history of being in the enterprise networking business. It remains to be seen what Avaya will do with Nortel’s networking business. I hope to get someone from the Avaya on the phone today.