13 October 2016

As you may be aware, the Joint Administrators have for some time been in negotiations in respect of the PPA / Allocation Dispute and the FSD Proceedings. It is likely that you will read reports in the press and the Joint Administrators confirm that a settlement has now been reached.

The Joint Administrators have entered into arrangements with companies in the wider Nortel Group, including those in Canada and the USA and with certain other major stakeholders, to initiate steps to end and settle on agreed terms the PPA dispute which has been ongoing for a number of years in North America following the very successful global disposals of the Nortel businesses and intellectual property.

The Joint Administrators have also entered into arrangements which will provide a route to conclude the FSD Proceedings brought against certain of the Companies, and other target entities in EMEA by the UK Pensions Regulator, if approved by creditors of those companies. This settlement will include arrangements that the claims of creditors as at 14 January 2009 will be paid before those companies are required to give any value pursuant to the FSD Proceedings.

Formal steps are required before courts in the United Kingdom, France, Canada and the USA. The Joint Administrators and others will progress these in respect of the Nortel EMEA entities. Stakeholders will be contacted in due course and will be provided with details of the steps and timeline involved.

The Joint Administrators consider this to be a major milestone, very welcome and extremely good news for the creditors of the Companies.

It is too soon to be specific about the dividend that the Companies will pay to their creditors. That said, the Joint Administrators believe that, if the settlements are successfully concluded, on the basis of present information the dividend % payment to creditors will be quite substantial and that it will be likely that a dividend will be paid in 2017 when certain formal processes, including implementation of the settlement plan and the formal adjudication of claims, have been completed.


For the Companies listed below, The Institute of Chartered Accountants in England and Wales in the UK authorises A R Bloom, S J Harris, C J W Hill and S J Taylor to act as Insolvency Practitioners under section 390(2)(a) of the Insolvency Act 1986 and the Association of Chartered Certified Accountants in the UK authorises A M Hudson and D M Hughes to act as Insolvency Practitioners under section 390(2)(a) of the Insolvency Act 1986.

The affairs, business and property of the Companies are being managed by the Joint Administrators, A R Bloom, S J Harris, A M Hudson and C J W Hill who act as agents of the Companies only and without personal liability.

The Companies are Nortel Networks UK Limited; Nortel GmbH; Nortel Networks France S.A.S.; Nortel Networks N.V.; Nortel Networks S.p.A.; Nortel Networks B.V.; Nortel Networks Polska Sp. z o.o.; Nortel Networks Hispania, S.A.; Nortel Networks (Austria) GmbH; Nortel Networks s.r.o.; Nortel Networks Engineering Service Kft.; Nortel Networks Portugal, S.A.; Nortel Networks Slovensko s.r.o.; Nortel Networks Oy; Nortel Networks Romania SRL; Nortel Networks AB; Nortel Networks International Finance & Holding B.V..

The affairs, business and property of Nortel Networks (Ireland) Limited are being managed by the Joint Administrators, A R Bloom and D M Hughes, who act as agents of Nortel Networks (Ireland) Limited only and without personal liability.

The affairs, business and property of Nortel Networks S.A. are being managed by the Joint Administrators, A R Bloom, S J Harris, A M Hudson, C J W Hill and S J Taylor who act as agents of Nortel Networks S.A. only and without personal liability.

Nortel Networks S.A. was placed into French liquidation judiciaire on 28 May 2009. The business and assets of the company that are situated in France are now under the control of la liquidateur judiciaire.

We advise that this report is provided pursuant to our appointments as Joint Administrators of the Company. It is provided solely for the purpose of informing creditors of certain aspects of the current status of the Administration. As this report is only an interim indication of the overall position of the Company, and not a valuation of the current or future value of any particular item of debt, and is liable to change, it should not be relied upon as an indication of the final return to creditors and, in particular, neither we nor the Company shall have any responsibility to any person who relies on our report for the purpose of trading in debt of the Company.

The Joint Administrators may collect, use, transfer, store or otherwise process (collectively, “Process”) information that can be linked to specific individuals (“Personal Data”).  They may Process Personal Data in various jurisdictions in accordance with applicable law and professional regulations including (without limitation) the Data Protection Act 1998.