I never did think that Nortel would or could step up to buy Avaya, because it simply did not make sense. The financials could not work for Nortel, which carries a market cap of only $11.5 billion. Most importantly, the product overlap is huge, and integrating the two companies is well beyond the resources available to the Nortel executive staff at the moment.
The comment about Nortel’s market cap is off the mark because it’s the structure of the deal (the amount, shares, stock, etc.) that are more important and relevant. His second point, however, is very on the mark.