Options Wonderland

[3xBuBu]

Nortel and Motorola in talks
Motorola Inc. and Nortel Networks are discussing a joint venture that would combine their wireless network infrastructure divisions, according to a media report.

The new entity would likely have sales of about $10 billion, combining businesses that make network equipment for wireless phone carriers, according to The Wall Street Journal, which cited people familiar with the talks.

The industry is seeking new ways to counter slowing growth in telecommunications equipment.

Nortel spokeswoman Ann Fuller said Monday that the company does not comment on "rumor and speculation." A Motorola spokeswoman could not be immediately reached for comment.

The reported talks, separate from a possible Motorola divestment of its handset division, would be part of a restructuring effort by Motorola's Greg Brown, who became chief executive Jan. 1.

Motorola last year pulled back from developing markets, cut 7,500 jobs and said goodbye to CEO Ed Zander. More cuts and changes are likely as the new management team scrambles to retain control in the face of a revived threat from activist investor Carl Icahn.

Last week, funds controlled by Icahn disclosed a 5 percent stake in Motorola in a filing with the Securities and Exchange Commission.

http://www.businessweek.com/ap/tech/D8UO79480.htm