- Belmont, CA
Blade Divestiture from Nortel Networks
Situation:
Nortel Networks decided that its ethernet switches for blade servers were not core to its corporate strategy and divested it to Garnett & Helfrich, a private equity company. This spin-out adopted the name ‘Blade Network Technologies’ (‘Blade’). This was an OEM business with a few key customers such as HP and IBM. Supply chain logistics were tightly integrated into the customers and third-party inventory hubs were used across the globe.
Kestrel Partners Engagement:
Kestrel covered two roles: As consultant to Garnett & Helfrich (‘G&H’), Kestrel assisted in valuation of this business unit to support G&H’s negotiations with Nortel while defining and drafting TSAs and analyzing business processes.
As a member of the Blade team, our professionals managed TSA’s, hired and trained back office staff, and simplified commercial processes. They also managed all legal aspects of the spin outs and were instrumental in lowering DSO. Within a mere 2 weeks, Blade was able to exit the finance TSA. The graphic below shows the highly complex commercial arrangement that needed to be transitioned to Blade. Our involvement managed the transition process and ensured that customer shipments were not delayed during this transition.
