Nortel sells DMS operations

Nortel Networks announced Wednesday that it has sold off some of its telecommunication circuit-switch manufacturing capability to Canadian electronics maker C-MAC Industries Inc. for an undisclosed sum.

Nortel is reeling from the tumbling economy, warning investors on Monday of an earnings shortfall. The company Monday also announced it was cutting 10,000 jobs. In the warnings announcement, Nortel said it would look to cut back on its noncore businesses.

C-MAC purchased the majority of Nortel's manufacturing activities for systems integration, configuration, and testing of the Nortel DMS circuit-switching products. The switches are used by telecommunication service providers in their central switching offices to channel phone calls and other phone traffic from subscribers to the network core.

Industry analysts pin the future expansion of carrier equipment sales to packet-switched technology, which lets phone calls be placed over the Internet for less cost and with more advanced services.

C-MAC's purchase includes most of Nortel's activities in Research Triangle Park, North Carolina and similar activities in Systems House in Monkstown, Northern Ireland. The transactions include the sale of associated equipment and inventory. The companies expect the proposed transactions to be completed by the end of the year.

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