Keep Nortel technology Canadian: Ont. minister

The government of Ontario wants the federal government to block the transfer of some of Nortel Network's advanced wireless communications technology to Sweden's LM Ericsson.

Over the weekend, Ericsson emerged as the victor in the auction of Nortel's wireless business with a bid of $1.13 billion US, giving the company access to Nortel's LTE, or long-term evolution, mobile technology.

Dwight Duncan, Ontario's finance minister, said the LTE was partly funded with Canadian taxpayer money, and he doesn't want it going to a foreign company.

Duncan called on the federal government to stop the sale to Ericsson and help arrange a deal that would see Research In Motion or another Canadian firm acquire the division.

"We'd like to see [the federal government] aggressively work with any Canadian company to keep that technology in our hands and particularly the job-creating potential here in Ontario," Duncan said.

"Governments at both the federal and provincial governments over the years have provided very generous research and development tax incentives, so Canadian and Ontario taxpayers have a real vested interest in this."

Federal Industry Minister Tony Clement did not rule out stepping in to keep the LTE technology in Canadian hands, but he said wants more information.

Clement said he is "not in a position to pre-judge the issue" adding that the sale will have to get through a national security test to be passed by the federal govenrment.

Opposition Liberal Leader Michael Ignatieff also issued a statement calling for the federal government to review the sale.

"Given the unique and strategic nature of Nortel's assets, a review is warranted," Ignatieff said.

Division to stay in Ottawa: Ericsson

Ericsson officials said the company will keep Nortel's wireless division in Ottawa.

Hans Vestber, Ericsson's chief financial officer, said Nortel employees in Ottawa should see the Ericsson name on their pay stubs by the third quarter.

Vestberg also said Ericsson intends to bring in some of its own managers, but it will keep the majority of employees at the Ottawa Nortel campus.

Ericsson also said during a teleconference call that it is confident its takeover of the Nortel wireless unit will be approved by the Canadian government.

Nortel plans to seek Canadian and U.S. court approval of the proposed sale at a joint hearing on July 28.

Nortel entered bankruptcy protection in January and has been selling off its assets.