Blackberry boss says naughty Nortel execs are blocking his bid to buy wireless assets

Last night, Jim Balsillie, RIM's co-CEO and the public face of the company, issued a statement in which he accuses Nortel of deliberately imposing "restrictive conditions" on his attempts to acquire the failed company's CDMA and LTE wireless assets - technologies widely regarded as of great significance both to Canada's national security as well as its international competitiveness - and called on the federal government to intervene.

Nortel is being flogged-off in parcels to the highest bidders and RIM has expressed serious interest in snapping up its wireless arm and has publicly announced that it would be willing to spend up to US$1.1 billion for them to keep the strategically important technologies in Canada. Such an offer would obviously trump the $650 million bid made for the same assets by Nokia Siemens Networks. especially as $300 million of that amount would actually come in the form of a guaranteed loan from Canada's Export Development Corporation!

In his release, Mr.

Balsillie writes, "RIM remains extremely interested in acquiring Nortel assets through a Canadian ownership solution that would serve the dual purpose of keeping key wireless technologies in Canada and extending RIM's leadership in the research, development and distribution of leading-edge wireless solutions, but RIM has found itself blocked at every turn."

So far the federal government in Ottawa has kept clear blue water between itself and the bidding process, not wishing to be seen to be exerting any pressure on what it insists is purely a commercial matter that must be settled by market forces and the private sector.

However, since Nokia Siemens made its stalking horse approach there have been growing calls for the federal government to step into the process and prevent what some parts of the media are now calling "sensitive state assets" from falling in to the hands of overseas organisations.

Nortel responded with a statement of its own in which it claims to be "disappointed" that RIM went public with its allegations and says that, on June 30 the Canadian courts set-up agreed bidding procedures and that at the time  "RIM did not object to the approval of these procedures."

The statement goes on to claim that it was not until July 15 that RIM sent in a document asking to be put on the list of qualified bidders for Nortel assets. "Since that time", the statement says, "Nortel has diligently attempted to work with RIM on acceptable confidentiality terms relating to Nortel's valuable intellectual property assets, but RIM refused to comply with the court-approved procedures."

Nortel was quick to come back with a rebuttal, saying, "We [Nortel] sought to be considered as a qualified bidder in Nortel's auction for the wireless business, but were told we could be qualified only if we pledged not to submit offers for any other Nortel assets for a year."

In other words, Nortel, although allegedly desperate and determined to sell itself off to anyone with the right amount of cash, is playing politics with another Canadian company - and beggars really can't be choosers.

Indeed, RIM is all the more aggrieved about the alleged discriminatory treatment as the news broke on the same day that Nortel sold its network-building enterprise business to US rival Avaya for the fire sale price of $475 million.

Mr. Balsillie's staement adds, "In seeking to impose conditions, Nortel and its advisers were fully aware of RIM's desire to purchase other Nortel assets as part of a solution to retain key portions of Nortel's business under Canadian ownership. Despite repeated efforts, Nortel, its advisers and its court-appointed monitor have rejected RIM's repeated attempts to engage in meaningful discussions."

Meanwhile, the federal government remains perched uncomfortably on a sharp bit of the fence. The Industry Minister, Tony Clement, insists he wants a private-sector solution and adds, "As Nortel is in bankruptcy protection, the Government of Canada does not have a say how the judge rules on any proposed sale of Nortel assets."

However, if things get any nastier or more rancourous he may have no choice but to intervene.

Meanwhile, and as what's left of Nortel continues to crash and burn, RIM shares are on the up-and -up. They rose in by 3.5 per cent yesterday and have now increased in value by more than 85 per cent since January 1 this year.