Thursday, October 2nd12.3°C
22738
22642

Settlement reached in a key dispute in Nortel Networks bankruptcy case

TORONTO - A last-minute settlement was reached Thursday in a key dispute in the Nortel Networks Ltd. bankruptcy case — over how much interest should be paid on Nortel’s outstanding bonds, according to documents filed in U.S. court.

The settlement, which will see U.S. bond holders collect up to US$1.01 billion in interest payments on outstanding bonds, still needs approval by the court, which will hear the matter in mid-September.

Nortel, which filed for bankruptcy protection in 2009, has $4.1-billion in outstanding bonds.

The Globe and Mail reported that U.S. bondholders had made written submissions to the court saying that interest should accrue at a contractual rate that would add up to at least $1.6-billion.

But Nortel’s Canadian monitor Ernst & Young and other creditors argued that any interest should have been calculated at a much more modest U.S. federal judgment rate, which would have capped payments at around $90-million, the Globe said. That would leave more for other creditors, including pensioners and former employees.

The compromise will see bondholders receive $876-million, plus as much as $134-million more if they have not been repaid by the middle of next year, according to the documents.

Lisa Schweitzer, a New York-based lawyer involved in the case, had no comment when reached on Friday.

The Nortel trial is considered one of the biggest bankruptcy cases in Canadian history. The cost of Nortel's demise has climbed above US$1 billion over the past five years, with legal expenses eating away at money that could be divided among the various parties.

At its height from 1999 to 2000, Nortel was worth nearly $300 billion, employed more than 90,000 people globally and was regarded as one of Canada's most valuable tech companies.

A related matter in the Nortel trial was still scheduled to go ahead in Toronto court on Friday.

The Canadian Press


Read more Business News




Recent Trending




Today's Market
S&P TSX14805.44-155.069
S&P CDNX896.35-12.94
DJIA16804.71-238.19
Nasdaq4422.085-71.305
S&P 5001946.16-26.13
CDN Dollar0.8987+0.0031
Gold1214.40-1.10
Oil86.79-2.32
Lumber344.10+6.30
Natural Gas4.044+0.021

 
Okanagan Companies
Pacific Safety0.135+0.005
Knighthawk0.01-0.005
QHR Technologies Inc1.22-0.04
Cantex0.075+0.01
Anavex Life Sciences0.1804-0.0036
Metalex Ventures0.0550.00
Russel Metals34.68+0.11
Copper Mountain Mining2.29-0.13
Colorado Resources0.16-0.005
ReliaBrand Inc0.019-0.001
Sunrise Resources Ltd0.065+0.045
Mission Ready Services0.31-0.01

 





FEATURED Property
1953599#53 3381 Village Green Way
3 bedrooms 1 baths
$74,900
more details
image2image2image2
Click here to feature your property
Please wait... loading


Power-save your way to a down payment

Part 2 of 2 to read Part 1, click here. 5. Dial down your vacations. New York is out. Maybe Buffalo. For West coast, maybe Seattle instead of Hawaii. Use sites like Airbnb (aribnb.ca) to find ch...


A wildly successful manufacturer

Niche food producer “Sweets from the Earth” thrives using innovation, uniqueness and an unwavering focus on quality. A neighbour’s stew turned Ilana Kadonoff off meat at the age of s...


Finding the smart money

Recently I had the privilege of working alongside André Voskuil, a local guru in the world of Alternative Financing. André has quite the reputation in the world of direct investments as ...

_








Member of BC Press Council


23391