However, reports here put Ericsson's offer at $730 million, making it the highest bidder.

'We will pursue the opportunity to the point that it makes sense,'' Ericsson spokesperson Kathy Egan told the Canadian Press.

'It's an interesting opportunity and we're always looking for ways to create value for Ericsson,'' she said.

Ericsson, which has been a long-time rival to Nortel in the global market as a supplier to phone companies, has a research and development centre in Montreal.

Nortel has not revealed the names of any other bidders for the court-supervised auction Friday. The 127-year-old Nortel, which was once the global telecom equipment maker giant, has been operating under bankruptcy protection since January after posting a $5-billion loss last year.