Riverstone granted court approval of $207 million sale of assets to Lucent Technologies

By Caroline Salls

Pittsburgh, March 23 - Riverstone Networks, Inc. obtained court approval to sell substantially all of its assets to Lucent Technologies Inc. for $207 million, according to a Thursday filing with the U.S. Bankruptcy Court for the District of Delaware.

Lucent's original stalking horse bid was $170 million. Riverstone also received a $178 million offer from Ericsson Inc., the U.S. operating unit of Swedish telecommunications vendor Telefonaktiebolaget LM Ericsson.

Lucent received Federal Trade Commission approval of the purchase on March 17.

According to a Lucent news release, the closing is subject to the receipt of regulatory approvals in Germany, which the company said it expects could happen early in April. The transaction is expected to close soon thereafter.

"The acquisition will enable Lucent to build on the strong momentum we are seeing in the carrier ethernet market, both with Riverstone platforms as well as Lucent's existing converged optical/ethernet solutions," Ken Wirth, president and general manager of Lucent's multimedia networking solutions business, said in the release.

"The integration of Riverstone's carrier-grade ethernet technology into Lucent's portfolio will enable us to more aggressively pursue ethernet market opportunities and help us reduce the development cycle for next-generation platforms that are currently being brought to market."

The acquired assets include primarily Riverstone products, intellectual property, contracts and receivables, tangible long-lived assets, accounts payable and some other accrued liabilities.

According to the release, substantially all of Riverstone's 400 employees are expected to join Lucent.

Riverstone, a Santa Clara, Calif., provider of ethernet routers, filed for bankruptcy on Feb. 7. Its Chapter 11 case number is 06-10110.

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