Nortel has had discussions with rival vendors about buying both its mobile infrastructure business and its enterprise networks unit, The Wall Street Journal reported Wednesday in an article that cited unnamed sources familiar with the matter. The company filed for bankruptcy protection in January after struggling with a financial scandal and a string of financial losses.

It has already sold its application acceleration business and pulled out of the mobile WiMax market, along with announcing thousands of layoffs, though it is reconsidering the possible sale of its metro Ethernet unit. When it filed for bankruptcy, Nortel said it expected to emerge from a reorganization as a more focused and financially sound operation. But selling the wireless and enterprise divisions would gut the once-giant communications technology company. Nortel is a significant player in the areas of carrier wireless infrastructure in which it still competes, and it has a large customer base for its corporate phone and data networks.

Without those two businesses, Nortel would be a collection of operations including its metro Ethernet business -- if that is not sold -- traditional wireline carrier equipment and consulting services.

Bankruptcy law requires that Nortel's affairs be resolved in a way that delivers the maximum value to bondholders and others to whom the company owes money, JMP Securities analyst Sam Wilson pointed out. In many bankruptcy cases, that involves keeping the company intact and making them shareholders. But if Nortel can realize more value by selling off its biggest businesses, it has to do so, he said. Wilson believes parts of the company will be sold.

Other observers agreed.