Nortel’s stock price dipped 20% yesterday to a mere 38.5 cents, amid rumours that the company would declare bankruptcy in the face of a $107 million interest payment. This morning’s Globe and Mail confirms that the Nortel board met last night, and has apparently decided in favour of bankruptcy.
It marks the beginning of the end of a long and painful process – a death by strangulation – that has cost the Ottawa community dearly. Tens of thousands of jobs have evaporated since Nortel ran into trouble eight years ago, and many more people have lost their life savings as well.
Much like the poorly performing Ottawa Senators, as Nortel’s woes became more apparent, the local tech community lost its swagger – the hubris that led Ottawa to declare itself Silicon Valley North in the late 1990’s. The exodus of employees from the tech sector became a raging torrent, as talented people chose secure government jobs over start-ups throughout the desperate downturn that followed. With Nortel’s end in sight, perhaps the rest of the community can shake its malaise, take advantage of the enormous and inexpensive talent pool here, and put Ottawa back to work as the Canadian tech center it once was.