Nortel Networks

Nortel, Flextronics Reschedule Calgary Manufacturing Transfer

    Toronto, Canada (ots/PRNewswire) - Nortel(x) (NYSE: NT; TSX: NT) and Flextronics(x) (NASDAQ: FLEX) have agreed to reschedule the transfer to Flextronics of Nortel's manufacturing  operations and related activities in Calgary, Alberta from the first to the  second quarter of 2006.

    The schedule was revised to allow completion of several major information systems changes that are expected to simplify and improve the  quality of operations during and after the transition. Nortel and  Flextronics anticipate no change in cash proceeds to Nortel of approximately US$575 million to US$625 million, of which the remaining US$ 200 million to US$240 million is expected to be received in 2006.

    Nortel transferred manufacturing operations and related activities in  Montreal, Quebec and in Châteaudun, France to Flextronics in 2005.

    About Nortel

    Nortel is a recognized leader in delivering communications capabilities  that enhance the human experience, ignite and power global commerce, and  secure and protect the world's most critical information. Serving both  service provider and enterprise customers, Nortel delivers innovative  technology solutions encompassing end-to-end broadband, Voice over IP,  multimedia services and applications, and wireless broadband designed to  help people solve the world's greatest challenges. Nortel does business in  more than 150 countries. For more information, visit Nortel on the Web at For the latest Nortel news, visit

    Certain information included in this press release is forward-looking  and is subject to important risks and uncertainties. The results or events  predicted in these statements may differ materially from actual results or  events. Factors which could cause results or events to differ from current  expectations include, among other things: the outcome of regulatory and  criminal investigations and civil litigation actions related to Nortel's  restatements and the impact any resulting legal judgments, settlements,  penalties and expenses could have on Nortel's results of operations,  financial condition and liquidity, and any related potential dilution of Nortel's common shares; the findings of Nortel's independent review and  implementation of recommended remedial measures; the outcome of the ongoing  independent review with respect to revenues for specific identified  transactions, which review will have a particular emphasis on the  underlying conduct that led to the initial recognition of these revenues;  the restatement or revisions of Nortel's previously announced or filed  financial results and resulting negative publicity; the existence of  material weaknesses in Nortel's internal control over financial reporting  and the conclusion of Nortel's management and independent auditor that Nortel's internal control over financial reporting is ineffective, which  could continue to impact Nortel's ability to report its results of  operations and financial condition accurately and in a timely manner; the  impact of Nortel's and NNL's failure to timely file their financial  statements and related periodic reports, including Nortel's inability to  access its shelf registration statement filed with the United States  Securities and Exchange Commission (SEC); the impact of management changes,  including the termination for cause of Nortel's former CEO, CFO and  Controller in April 2004; the sufficiency of Nortel's restructuring  activities, including the work plan announced on August 19, 2004 as updated  on September 30, 2004 and December 14, 2004, including the potential for higher actual costs to be incurred in connection with restructuring actions  compared to the estimated costs of such actions; cautious or reduced  spending by Nortel's customers; increased consolidation among Nortel's  customers and the loss of customers in certain markets; fluctuations in  Nortel's operating results and general industry, economic and market  conditions and growth rates; fluctuations in Nortel's cash flow, level of  outstanding debt and current debt ratings; Nortel's monitoring of the  capital markets for opportunities to improve its capital structure and  financial flexibility; Nortel's ability to recruit and retain qualified employees; the use of cash collateral to support Nortel's normal course  business activities; the dependence on Nortel's subsidiaries for funding;  the impact of Nortel's defined benefit plans and deferred tax assets on  results of operations and Nortel's cash flow; the adverse resolution of  class actions, litigation in the ordinary course of business, intellectual  property disputes and similar matters; Nortel's dependence on new product  development and its ability to predict market demand for particular  products; Nortel's ability to integrate the operations and technologies of  acquired businesses in an effective manner; the impact of rapid  technological and market change; the impact of price and product  competition; barriers to international growth and global economic  conditions, particularly in emerging markets and including interest rate  and currency exchange rate fluctuations; the impact of rationalization and  consolidation in the telecommunications industry; changes in regulation of  the Internet; the impact of the credit risks of Nortel's customers and the  impact of customer financing and commitments; general stock market  volatility; negative developments associated with Nortel's supply contracts  and contract manufacturing agreements, including as a result of using a  sole supplier for a key component of certain optical networks solutions;  the impact of Nortel's supply and outsourcing contracts that contain  delivery and installation provisions, which, if not met, could result in  the payment of substantial penalties or liquidated damages; any undetected  product defects, errors or failures; the future success of Nortel's  strategic alliances; and certain restrictions on how Nortel and its  president and chief executive officer conduct business. For additional  information with respect to certain of these and other factors, see the  most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q  filed by Nortel with the SEC. Unless otherwise required by applicable  securities laws, Nortel disclaims any intention or obligation to update or  revise any forward-looking statements, whether as a result of new  information, future events or otherwise.

    (x)Nortel, the Nortel logo and the Globemark are trademarks of Nortel Networks. Flextronics is a registered service mark of Flextronics International, Ltd.

ots Originaltext: Nortel Networks
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