The optical networking and carrier Ethernet business was the last unit auctioned by Toronto-based Nortel which has been operating under bankruptcy protection in the US and Canada since January.

The 124-year-old Canadian icon, which was once the world's top telecom equipment maker, has been selling its various businesses to pay off its debtors. Since Nortel is operating under court-granted bankruptcy protection, Tuesday's auction will go before courts in the US and Canada next month for approval.

Maryland-based Ciena Corp trumped Nokia Siemens Networks with its offer of $769 million - $530 million in cash and remaining portion in notes. After acquiring Nortel's last major asset, Ciena said it will retain 2,000 highly-skilled jobs in Canada.

Ciena Corp. CEO and president Gary Smith said, "We are bringing together complementary technologies in switching and transport to create an innovative powerhouse with the scale to challenge the industry status quo and offer customers a practical path for transitioning to automated, optical Ethernet-based networking.''

Under the auction, Ciena also acquires Nortel's main R&D centre in Ottawa and other smaller centres in Montreal and Toronto.

Once the biggest telephone equipment maker in the world, Nortel sold its next-generation wireless business to Sweden's Ericsson under a court-supervised auction for $1.13 billion in July. Ericsson had beaten Nokia Siemens which had put forward a $650-million bid.

In September, Nortel sold its enterprise division to America's Avaya Inc.  for $900 million.
At its height, the 124-year-old Canadian company employed more than 90,000 people worldwide and accounted for more than a third of the Toronto Stock Exchange.