It turns out that Ottawa won’t be reviewing the Nortel patent sale after all. Canada’s Industry Minister Christian Paradis said that the sale of Nortel’s remaining patents to a consortium to the tune of $4.5 billion does not require review under the Investment Canada Act.
According to Paradis, it’s the accounting value of the patents that sets the bar here. It does not meet the threshold and, as a result, no review is required.
Had the “book value” of the patents exceeded $312 million, a review would have been required. Paradis said that Nortel’s 2010 fiscal statements and information provided revealed that the patents were not at that value with respect to book value. It was market interest that boosted the price to $4.5 billion. The implications these goodies have with respect to the wireless sector is also part of the equation.
So that settles that issue and now the pensioners have more to look forward to. The sale of the patents, totalling $7.2 billion, should help top up the underfunded pensions. But it still won’t put things entirely right, as Nortel has a long list of creditors to contend with. It is currently estimated that the pension plans are underfunded by around $1.5 billion. With that kind of money in the equation, Ottawa’s safe passage of the final patent auction is good news for those owed by the once-great Canadian tech icon.
“There’s not enough money to go around,” said Anne Clark-Stewart of Nortel Retirees and former employees Protection Canada.
Still, every ounce must count. Nortel’s army of employees were integral to the company’s rise through the ranks and they deserve economic justice in the form of their pensions. The sale of the remaining patents, as we’ve noted elsewhere, marks the end of an era in Canadian telecommunications. With RIM remaining in a relatively precarious position at times, our fond memories of Nortel may soon be all we have.