(Updates with additional details about the assets and confirmation by Nortel; adds background)
Of DOW JONES NEWSWIRES
NEW YORK -(Dow Jones)- Ciena Corp. (CIEN) is the latest technology company looking to scoop up a piece of Nortel Networks Corp. (NRTLQ), which continues to break up under its plan to liquidate under bankruptcy protection.
Ciena said Monday that it was in advanced talks to buy substantially all of the optical networking and carrier Ethernet assets from a Nortel unit. Such a purchase would bolster the Linthicum, Md.-based company's own network infrastructure business, which includes optical equipment specializing in long-distance connections.
Ciena is looking to acquire assets under Nortel's Metro Ethernet Networks business, which reported revenue of $1.39 billion last year, down 8.7% from 2007. It wasn't immediately clear how big a part of that unit the assets in question represent.
The outcome of the discussions were "uncertain and subject to negotiation of definitive agreements," Ciena said in a statement Monday.
Nortel later confirmed the talks in a statement, also noting that the outcome was still uncertain.
Any agreement would have to be approved by the U.S. Bankruptcy Court for the district of Delaware and the Ontario Superior Court of Justice.
Nortel, also a telecom-equipment maker, filed for bankruptcy protection in January and has been selling off assets as it works to streamline its structure. Since then, technology companies have swooped in to buy up several of its valuable businesses.
On Wednesday, Nortel put up its GSM wireless technology business for sale through an open auction process. Avaya Inc. (AV) agreed to pay $915 million for the part of the business that sells communications gear to corporations. L.M. Ericsson Telephone Co. (ERIC) bought the wireless networks business for $1.13 billion.
Ciena's shares closed down 3.3% at $14.17 Monday. The stock has more than doubled in value this year.
-By Roger Cheng, Dow Jones Newswires; 212-416-2153; roger.cheng@dowjones.com
(John Kell contributed to this article.)