Nortel is keen to sell off its 50 percent stake in its South Korean joint venture with LG Electronics, reports the Financial Times. The report says a sale would value the joint venture – known as LG-Nortel – at close to US$1 billion and notes that private-equity groups Providence Equity and Carlyle Group, and rivals such as Huawei, could be interested. Nortel, which has been in bankruptcy protection since January and is under pressure to sell-off some of its assets, has reportedly hired Goldman Sachs to find a buyer. Neither Goldman Sachs nor Nortel would confirm that a deal was underway, but Nortel noted that “LG-Nortel is a separate and solvent entity with no debt and a strong cash balance.” According to the FT, LG-Nortel last year posted revenues of KRW1,118 billion (more than US$1 billion at last year’s average exchange rate) and an operating profit of KRW229 billion. LG’s position in the deal in also unclear and people familiar with the matter claim the firm could either look to take control of the joint venture or exit altogether. “What LG Electronics does next will tell us whether it regards telecoms equipment as a growth industry,” said one dealmaker.

Meanwhile, Nortel announced yesterday that it has been successful in applying for an extension to its bankruptcy protection order. Canada’s Ontario Superior Court of Justice has now given the firm until 30 July to present its restructuring plan for consideration. Nortel has previously said it plans to emerge from bankruptcy protection intact but it is also under pressure to maximise the value of its assets by selling them off to competitors. Nokia Siemens Networks (NSN) has been linked with its mobile assets, while Nortel’s enterprise unit has reportedly attracted bids from Avaya and Siemens Enterprise Communications.