Tech & Biz

Nortel Bankruptcy Could Hurt Olympic Sponsorship

by Jordan Yerman | January 15, 2009 at 09:02 am

188 views | 3 Recommendations | 2 comments

Nortel's woes deepen as its UK arm goes into administration. The telecom's bankruptcy could also affect both the 2010 and 2012 Olympic Games, both of which count Nortel as a major sponsor.

Nortel Networks UK, which is based in Maidenhead, said it had appointed Ernst & Young as its administrators.

The company signed on as a supplier for the 2010 Games in a deal worth between $3 million and $15 million but it's the 2012 Summer Games in London that could be hit hardest. Nortel's sponsorship of the 2012 Games is worth about $71 million in cash and network infrastructure.

Vancouver Organizing Committee chief information officer Ward Chapin said in a statement that Nortel has been an exceptional partner over the years. Nortel is not providing any cash to the 2010 Games but in-kind services such as phone and networking equipment.

Another big sponsor: GM. Not looking good for Vancouver's taxpayers, currently facing a huge bill for the Olympic Village construction.

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dowdinsk

at 04:21 on January 17th, 2009

It could well have some impact on London 2012. Nortel have worked jointly on various projects with British Telecom, another Tier One sponsor for 2012, so there could well be some revelations coming to light about similar 'in-kind' deals as well.

Also around the time of the financial crisis, post-Beijing, Johnson & Johnson and Lenovo dropped their sponsorship of 2012.

mtammas

at 19:27 on January 15th, 2009

This is not the only horror to befall Vancouver's 2010 Olympic Games. The Olympic Village financier is in trouble and the city has underwritten the project, meaning taxpayers may be on the hook for hundreds of millions of dollars. And the security costs are so astronomical that neither the provincial nor the federal governments will talk about it. Some are speculating that security will run as high as the bid itself. The real travesty is that the International Olympic Committee carries no responsibility for any of this yet wields an undemocratic hammer over the Games and any host country. Time to rethink this whole Olympics thing.