Nortel CEO steps down


10 Aug 2009

Share on FacebookTweet about this on TwitterShare on LinkedInShare on Google+Pin on PinterestShare on RedditEmail this to someone

Share on FacebookTweet about this on TwitterShare on LinkedInShare on Google+Pin on PinterestShare on RedditEmail this to someone

The president and CEO of Nortel Networks, Mike Zafirovski, has stepped from his position with the ailing tech company, effective from today.

In a statement, Nortel said that its board of directors and Zafirovski (pictured) believe the company has reached “a natural transition point”.

Also effective today, the Nortel board of directors will reduce from nine to three members: John A MacNaughton, Jalynn H Bennett and David Richardson, with Richardson serving as chairperson.

"We’ve reached a logical departure point," said Harry Pearce, current chairman of Nortel’s board . 

"Mike made a commitment to see the process through the stabilisation of the company, sale of its largest assets and the right plans and people to continue operating our business and serving customers. He has done so.  I appreciate the commitment and passion he brought to this company since day one, including his guidance through the extremely difficult decisions we faced since filing for creditor protection. I also wish to recognise the enormous commitment and dedication of the departing members of the board, who really believed in and worked hard for Nortel,” said Pearce.

“I am extremely proud to have been associated with this company. The board members and I came to Nortel because we really believed in the value of Nortel’s people and technology. Although solid progress was made in many areas, at the end, the capital structure and legacy costs coupled with the economic downturn proved too difficult to surmount,” Zafirovski said.

The Toronto-based company did not announce a successor to Zafirovski, although it did say that it will be seeking Canadian court approval for Ernst & Young, the company’s monitor, to take on an enhanced role with respect to the oversight of the business, sales processes and other restructuring activities.

The company also said it was in the process of identifying a principal officer for the Nortel companies in US Chapter 11 proceedings.

Nortel filed for Chapter 11 bankruptcy in January. The telecoms and networking equipment giant never fully recovered from the major economic downturn of 2001 and 2002, made worse by the dotcom downturn.

Since filing for bankruptcy protection, Nortel has been selling off its various units, with Ericsson becoming a successful bidder for its code division multiple access (CDMA) business and Long Term Evolution (LTE) access assets for US$1.13bn on 25 July.

According to Bloomberg.com, Michael Lazaridis, co-chief executive officer of BlackBerry manufacturer RIM, said that his company had bid on some of the assets of Nortel Networks before it filed for bankruptcy. He added that Nortel had not negotiated in good faith and said that the sale was not in Canada’s interest.

In March 2009, Nortel revealed that up to 90 jobs were to go at its Co Antrim-based operation in Newtownabbey. At its peak, the Northern Irish operation employed 2,000 people. Today, the operation employs 500 workers.

66

DAYS

4

HOURS

26

MINUTES

Buy your tickets now!