Selsius Systems was a subsidiary of Matra Communications, with expertise in call setup using H.323…

Matra, the French communications equipment company with which Northern Telecom had a joint product and distribution relationship in France, owned a subsidiary in Texas (Intecom) with a subsidiary called Selsius that had developed an IP telephone, call manager and IP-analog gateway for fax machines or other telephones.

Selsius Systems, earned an early product review in Network Computing and was on the front cover of the October 1, 1998 issue.

Well, the Enterprise Data Networks group negotiated to acquire the company from Matra. Total price was $70 million in Nortel stock, but required 75% of the employees to come with the deal. The team knew that Intellectual Property without people was considerably less valuable. The vote was held on a Friday and did not reach the required theshold. Many employees apparently were afraid that NT would squish the project deferring in any competitive squabbles to the traditional PBX – Meridian 1, which was the gorilla in the market.It didn’t matter to these folks that the EDN group were peers of Jim Long and the EN group.

So, it was decided to take a few days to cool off, regroup and try again in about a week. But, by that time, the leadership of Selsius had already flown to San Jose, met with Cisco M&A people, and reached an agreement for $120 million in cash. Nortel was going to have to build its IP-PBX from zero. That job fell to Micky Tsui, who had championed the Nortel-Shiva deal to bring Internet Dialup Switches to the company. I worked for Micky in 1995-1998 (or for Brian Collie who reported to Micky).

Micky Tsui now works at Avaya where he is the VP of IP Telephony, in Dallas.

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