Law-Forums.org

[darrick34]

Of course not. Nortel has been in bankruptcy for a couple of years. Nortel even said after the auction that it expected that none of the proceeds from the sale would benefit equity holders and that they stilll expected that the bankruptcy process would result in cancelling the equity interests. What's left of Nortel sold these patents as part of their bankruptcy liquidation.

Why do so many people on YA have so much trouble understanding that bankruptcy means that the equity interests are gone? And yet you are expecting "windfalls" to equity? I just don't get it....

Edit: Add Scary Barry, the two people who gave him thumbs up, all the idiots who bought NRTLQ today to the list of idiots who don't get this. The stock is worthless. Nobody at Nortel is trying to save it. Nobody in the world is trying to save it. It is worth 0. Big 0. Nada. Zilch. Not a penny. Not one one-millionth of a penny. Done....

Edit 2: There are even preferred shareholders who expect to get nothing and they are above the common on the food chain.

Edit 3: What's with these Canadian telecom companies anyway? First Nortel is Canada's leading telecom giant. Now RIM. RIM will be having one of these patent auctions in a few years..

Edit 4: I see that '1 yr target est' of 1.20. Obviously I don't know where that comes from but it is obviously not correct. Maybe it's the last estimate prior to bankruptcy and Yahoo just keeps it around. I wonder how much damage that is doing to people who look at bankrupt companies and think Yahoo is telling them that they will go up 60-fold in a year. Yikes! Yahoo ought to fix that.

[blaeey]

Nortel sold the patents to settle a portion of their outstanding debt obligations. When a company declares bankruptcy, it means that their assets ( this includes patents, which are IP Intellectual property ) are less than their liabilities.

So shareholders will get nothing from this sale. perhaps some bondholders, who are higher up the food chain, will get a few cents on the dollar for their bonds. Not common shareholders - too bad for them.

[hawiovi]

Technically, that money belongs to the share holders because the common share holders are the actual owner of the company. BUT, before the share holders get to that money, the company has to pay for the debts, the related expenses, taxes, pensions etc. By the time there are all paid, there is hardly anything left.

[wendlesora]

They do it all the time, because we keep on sleeping while we're dreaming of having it like that.