<http://www.thehammer.ca/story.php?section=pages/24&page=1.html>
The last 18 months have been tumultuous for high-tech giant Nortel: the cutting of its global workforce by more than half from 96,000 to 47,000, the abrupt departure of its CEO, massive quarterly losses in the billions, and a severe drop in share prices, to name but a few. However, the company might be turning the tables with its new effort to bolster investor confidence.
Yesterday, the company announced a partnership deal with McDonald's Restaurants of Canada, in which shareholders will be able to purchase discounted meals in exchange for cashing in their Nortel shares.
As of May 1, participating McDonald's restaurants will be accepting 100 shares of the company's stock in exchange for a 50 per cent discount on a Big Mac or McChicken combination meal, complete with medium fries and beverage, according to Nortel Vice-President of Grilling and Deep Frying Isabelle Egad.
"This is a win-win proposition for shareholders," said an enthusiastic Egad, who insisted that the new partnership will feed "tens of thousands" of laid-off Nortel employees.
"Rewarding consumers and investors for their loyalty is very important today. It's like that Petro-Points thing at Petro Canada where after 40,000 litres of gas you can get like a lighter, or a bottle of water or something....we wanted to do the same sort of thing for Nortel shareholders who have stuck with us through thick and thin," continued Egad.
Nortel shareholders will be able to 'super-size' their meals for an additional 50 shares, according to Egad.
As Nortel's stock price dropped from a high of $125 in July 2000 to 1/8th of one cent (Cdn.) at the close of markets yesterday, many frustrated Nortel investors have pointed accusatory fingers at the company's management, blaming them for the free fall in the stock's value. Shareholder activist Frank McMorgan of Bathurst, New Brunswick has been a vocal critic of the company in recent months, but he expressed guarded optimism with the announcement.
"Sure, my grandchildren's inheritance is still pretty much right out the window, but, at least I'll be able to take them down to the local McDonald's for a quarter-pounder every now and then. That'll be a welcome change from my daily routine of cat food," said McMorgan, a retired mill worker.
Nortel shareholder Vincenzo Morgante of Montreal also gave the McDonald's partnership his endorsement. "I have all these stock certificates lying around the house collecting dust. I was gonna wallpaper my den with them, but now I might go to McDonald's and get a filet o' fish or something."
Professor Clive Taggart of the University of Western Ontario's Richard Ivey School of Business isn't sure if the McDonald's-Nortel joint partnership will do anything for Nortel's stock price. "Really, how on earth would I know? As if any of us know what the hell we're talking about," groused Taggart.
"A drunk donkey could do just as well," added the professor as he threw darts at a board in his office while enjoying a Chicken McNugget meal, which cost him only 300 shares in the company.
A spokesperson for McDonald's indicated that the company will be using all of the Nortel share certificates collected during the promotion to wrap Big Mac burgers, and will not, contrary to rumours simply be chucking them in the garbage. "It's a great cross-promotion," said the spokesperson of the new Nortel-themed burgers. "Not only do we save on costs, but Nortel gets some free adertising out of it as well."
The company spokesperson also indicated that McDonald's of Canada is in similar discussions with Ottawa-based tech companies JDS Uniphase and Corel.
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