The federal government could have prevented the liquidation of Nortel Networks Corp. (NT-T0.19----%) with a massive bailout, but instead Ottawa has decided that the best way to salvage something from the biggest corporate bust in Canadian history is to help fund a foreign breakup.
Through the Export Development Corp. (EDC), which normally helps Canadian exporters and investors expand their businesses abroad, the government will provide $300-million toward a credit facility for Nokia Siemens Networks' $650-million (U.S.) bid for Nortel's wireless assets.
The unusual turn of events highlights the lack of confidence Ottawa has in Nortel's leadership to turn around the company after it entered creditor protection Jan. 14. The EDC, for example, was only willing to provide $30-million (Canadian) of support to Nortel until July 30. And despite numerous meetings between Nortel's senior management and members of cabinet, the government proved unwilling to back restructuring efforts.
http://www.theglobeandmail.com/globe-investor/nortel-breakup-signals-rd-power-shift/article1191282/