Hurray, More Time to Restructure!

http://www.ottawacitizen.com/business/Nortel+wa…

January 30, 2010

By the time this is over, lawyers, accountants and other professionals will have submitted more than $250 million in bills, which are paid in full before creditors receive anything. (All figures U.S.).

Creditors in Canada alone are represented by more than 80 law firms.

The total value of claims submitted by U.S. and Canadian creditors approached $40 billion last autumn and has almost certainly increased. The sum available to satisfy these claims will be a relatively piddling $5 billion or so
This suggests creditors will receive little more than 12 cents for every dollar owed to them. Fortunately, that's not how the process works.
In fact, the $40 billion in demands is a vastly inflated figure, pumped up by creditors who have filed the same claim in several Nortel subsidiaries to increase the odds of receiving something.

A more realistic estimate is …Nortel reckoned it owed nearly $7 billion to creditors globally.

Nortel's bonds are trading between 70 and 73 cents on the dollar— roughly the same ratio implied by dividing $5 billion in projected proceeds by $7 billion worth of claims.

The creditors most concerned are some 19,000 Canadian pensioners,
The source of their worry can be found in a 67/8-per-cent Nortel bond issued in 1993. It's the only one secured against Nortel assets in Canada alone. And it's been trading at roughly 30 cents on the dollar. This points to strong pessimism about the amounts that will become available.

Nortel's U.S. subsidiary earned the right to file a $2.1-billion claim against the Canadian Nortel estate. Such a claim would substantially dilute the amount available to Canadian creditors.

They are ably represented but the odds seem long. In theory, Canadian creditors should receive the same settlement as other Nortel creditors — 60, 70 cents per dollar owed or whatever the final ratio proves to be. But only if their lawyers can establish that the spoils should be divided globally.

Negotiations over precisely this point have been taking place for months between the main creditor groups in Canada, U.S. and Britain. But a settlement doesn't appear close.

“There is no answer to that question as yet,

The creditors most concerned are some 19,000 Canadian pensioners, thousands more on long-term disability and hundreds of suppliers.

The source of their worry can be found in a 67/8-per-cent Nortel bond issued in 1993. It's the only one secured against Nortel assets in Canada alone. And it's been trading at roughly 30 cents on the dollar. This points to strong pessimism about the amounts that will become available.

According to claims by its creditors: $39.3 billion
In $U.S. as of last autumn. Includes many duplicate claims.
According to Nortel: $6.92 billion

Nortel says the amount could be 'subject to future adjustments.'

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Also:
http://www.lexology.com/library/detail.aspx?g=c…

On January 21, 2010, a claim in the amount of $2 billion dollars by Nortel Networks Inc, an American affiliate of Nortel Canada, was approved and accepted against Nortel Canada

Nortel Canada will now proceed to close pending sales and to realize on remaining assets. Mr Justice Morawetz has indicated that he wants to see distribution to creditors. But stakeholders acknowledge that there is much to be done before creditors will see any money, including a multi-national determination as to how to allocate proceeds of sale on the various worldwide fully-integrated Nortel businesses.

The Court of Appeal rejected the union’s argument that Nortel’s obligation to make payments to former employees

you can get over 100 shares or you can buy lottery tickets instead where the odds are exponentially greater =)

So much for working in the shareholder and employees interests
zero stock 99.9% later and even cut severances/pensions before looting the corpse… forced inquiry… etc…

Who can even trust these masters of deceit and delay on what they claim they owe with their stellar accounting following the largest fraud in Canada

Nothing left… Nortel gone….no one to answer questions…
Canada's Enron/Worldcom is all gone, swept under rug in fraud heaven North of the 49th parallel…

Liquidating with legal fees, bonuses, and ex board members law firm defending ex CEO fired for cause against largest fraud in Canada, etc., a joke…mockery of our system and regulators, Fraud pays in Canada, hard to prove and if they do there are little to no penalties vs. the USA where they staple ones posterior to the wall for lies for massive theft to ruin many thousands. Not here.

yeah yeah. more than a trillion in debt is not very powerful. sounds quite broke. if they were so powerful they would not be bending to china requesting to take us companies off the sanction list for selling to taiwan.

if you are right about one thing its about Canada being a sad story. it has a lot of wasted potential but nothing can be done if you only have daft people running the country.

One Lesson from this, don't buy stock in Canadian Companies.

At least in the US some go to jail. No one will pay for this. Z and Strangler should be locked up for their lies.

Yeah, I'd like to know if lightbulbs are being reinstalled, badge access is working flawlessly, as usual, and most of all, is Lean Six Sigma being adhered to religiously! I find it strange that Avaya would be looking outside for LSS skills?

http://www.linkedin.com/jobs?viewJob=&jobId=811286

Senior Services Process Engineering Manager at Avaya

• Senior, experienced executive… – yup
• Proven ability to leverage…. sure
• Responsible for championing … can do
• Provide leadership… whatever.. wait!.. to most strategic process improvement programs based on Lean Six Sigma expert-level skills and experience (been there, done that)

“Been there, done that” has been Nortel's slogan for a while now. Everytime it was tucked into a financial MRI and the results came back “positive” (which was a “negative” thing, see?) the brass poo-pooed “Been there, done that, positively”

•… increase process speed, eliminate waste, reduce variation and improve customer satisfaction

Ship it all to China, fast. Next.

• Ability to work in a fast-paced, sometimes ambiguous environment

If Nortellians have experience with anything, its an ambiguous environment.

I would expect more extensions given the fundamental differences between CCAA law and Chapter-11 law. I highly doubt that US based bondholders and creditors will blindly accept different treatment for Canadian creditors.

Piece o' cake – the lightbulbs, that is

Some dough for execs or lawyers ?

http://www.phoneplusmag.com/hotnews/nortel-sell…

There's a movement to radically change California government, by getting rid of career politicians and chopping their salaries in half. A group known as Citizens for California Reform wants to make the California legislature a part time time job, just like it was until 1966.
http://www.onlineuniversalwork.com