Comments on: Nortel: We Owe the IRS Nothing

By: Who owns Nortel ? I say the Canadian taxpayer. Why ? « TheTelecomBlog.com

Who owns Nortel ? I say the Canadian taxpayer. Why ? « TheTelecomBlog.com — Wed, 23 Sep 2009 10:39:07 +0000

[...] US government is standing in line with their hands open, waiting for their billions in proceeds from Nortel’s bankruptcy [...]

By: Who owns Nortel ? I say the Canadian taxpayer. Why ? | TheTelecomBlog.com

Who owns Nortel ? I say the Canadian taxpayer. Why ? | TheTelecomBlog.com — Wed, 23 Sep 2009 10:37:25 +0000

[...] US government is standing in line with their hands open, waiting for their billions in proceeds from Nortel’s bankruptcy [...]

By: RedFlag

RedFlag — Thu, 17 Sep 2009 13:22:58 +0000

I don't believe NT is comming out of BK either.

Consider that most small businesses that are incorporated will shaft the bond holder in a BK.

Say a person owns a company and someone loans it money to run the business with no debt covenants attached. If the business goes bad, what usually happens is that the owner takes out the money from the corporation in the form of salary/expenses/dividends. Then BK is declared and money lender is screwed. This happens all the time.

Is it still possible for NT to do the same? Theoretically speaking...yes, NT can come out of BK and shaft bondholders. (but maybe money from the asset sales are locked up for creditors)

By: GoProto

GoProto — Thu, 17 Sep 2009 12:16:36 +0000

I do Not Believe they are coming out of BK..
The carcass has already begun to be ravished. It's now just a matter of time.

By: RedFlag

RedFlag — Thu, 17 Sep 2009 09:22:58 +0000

By: GoProto

GoProto — Thu, 17 Sep 2009 08:16:36 +0000

I do Not Believe they are coming out of BK..
The carcass has already begun to be ravished. It's now just a matter of time.

By: RedFlag

RedFlag — Thu, 17 Sep 2009 04:10:05 +0000

I think 1B bonds are due 2011.

So why not make the interest payment now. Pay severance to employees. Pay out dividends to shareholders. Pay pensions.

Then go bankrupt.

SO.... The only difference is that more money goes to the small guy should NT come out of bankruptcy. Eventually NT dies. It's a matter of who gets to eat the carcass.

By: GoProto

GoProto — Thu, 17 Sep 2009 03:59:26 +0000

Yeah, Meet me in the Meat locker , buddy. ;>)

By: GoProto

GoProto — Thu, 17 Sep 2009 03:57:49 +0000

NT can come out of Chap11 because it has the cash to do so because bonds aren't due, only the interest payments are due.
—————–
Huh? You are kidding , right?

By: RedFlag

RedFlag — Thu, 17 Sep 2009 03:23:38 +0000

At this point, it doesn;t matter who is right, IRS or NT. It's the judges decision that counts. I think the boys club wins this won over the IRS…… money continues to be siphoned off from Nortel into private sector.

Otherwise, as another poster says, creditors may settle with IRS to avoid a long legal battle.

NT can come out of Chap11 because it has the cash to do so because bonds aren't due, only the interest payments are due.