Canada

The empire of Alberta's premier chocolate maker is melting after 27 years of providing high-end treats, The Calgary Herald reported. Debt problems brought on by slumping sales and an ill-timed real estate buy forced Chocolaterie Bernard Callebaut into receivership Tuesday, leaving roughly 210 employees at 30 stores and the Calgary factory and headquarters under the control of a court-appointed financial services firm. Vic Kroeger, senior vice-president with Deloitte & Touche in Calgary, said raising new capital is probably the company's "only hope" of survival.

Canadian authorities canceled two Mexico City-bound flights from airline Mexicana de Aviacion on Thursday amid mounting concerns over the financial health of the company, Reuters reported. The flights, set to depart from Montreal and Calgary, were canceled due to a request to Canadian authorities from an unnamed creditor seeking clarification on Mexicana's debt situation, the airline said in a release.

Despite hundreds of millions of dollars in orders and enough public support and goodwill to sink a ship, Canada's oldest and most prestigious shipyard, Davie Yard, is once again floundering. And it risks going under for good if a major financial or strategic investor isn't found by Sept. 15, The Montreal Gazette reported. "We're looking for a third party to invest or to buy assets," said Pierre Laporte, a chartered accountant and bankruptcy trustee with Samson Belair Deloitte Touche, who has been in charge of the file since Feb.

Canada's BCE Inc. has agreed to pay $40 million cash and drop $500 million worth of claims to settle litigation over the collapse of Teleglobe Communications Corp., a failed subsidiary, Dow Jones Daily Bankruptcy Review reported. Documents filed with the U.S. Bankruptcy Court in Wilmington, Del., set out terms of the pact, which caps five years of litigation in courts in the U.S. and Canada. The deal means cash for bondholders of Teleglobe and a smaller pile of debt in the bankruptcy case, a product of the telecommunications industry meltdown of 2000 and 2001.

Bankrupt Canadian newsprint producer AbitibiBowater Inc said it repaid $166 million of its debtor-in-possession loan following an improvement in market conditions and operational performance, Reuters reported. In regulatory filings with the U.S. Securities and Exchange Commission, the company said it now had $40 million outstanding under the loan. AbitibiBowater also extended the DIP loan to Dec. 31, 2010, and modified certain covenants. It now has the ability to retain the proceeds from asset sales without triggering a mandatory prepayment. The amendment fee amounted to about $1 million.

AbitibiBowater Inc. is seeking to keep control of its restructuring for an extra three months so it can stay on track to emerge from bankruptcy early this fall, Dow Jones Daily Bankruptcy Review reported. The giant pulp-and-paper manufacturer is urging the U.S. Bankruptcy Court in Wilmington, Del., to extend the time in which it alone has the right to file a Chapter 11 plan of reorganization, which AbitibiBowater has already filed but is continuing to negotiate the terms of with its creditors. If the court doesn't agree to extend its exclusive plan-filing rights through Oct.

AbitibiBowater Inc. on Thursday pushed off until July 30 a preliminary hearing on its Chapter 11 exit plan, as talks continue with investors clamoring for a piece of the paper-maker's $500 million debt-rights offering, Dow Jones Daily Bankruptcy Review reported. Aurelius Capital Management LP and Contrarian Capital Management LLC say their $620 million claim entitles them to participate in the deal, part of AbitibiBowater's bankruptcy emergence financing.

Nortel Networks Inc., once part of North America’s biggest maker of telecommunications equipment, filed its plan to repay creditors without disclosing how much they will get, Bloomberg Businessweek reported. The plan, filed yesterday in U.S. Bankruptcy Court in Wilmington, Delaware, doesn’t provide details about how the company will divide the proceeds from selling its assets. Nortel, based in Toronto, filed for bankruptcy last year along with its parent, Nortel Networks Corp. The company has since raised about $2.8 billion from selling assets.

Two AbitibiBowater Inc. bondholders are asking that their disputed $620.1 million claim be temporarily reclassified in the company's Chapter 11 case so that they can participate in the paper maker's debt-rights offering, Dow Jones Daily Bankruptcy Review reported. Aurelius Capital Management LP and Contrarian Capital Management LLC said in papers filed Wednesday with the U.S. Bankruptcy Court in Wilmington, Del., that AbitibiBowater's proposed Chapter 11 plan is designed to block them from buying debt in the reorganized company that is convertible to stock at a discounted price.

Insolvent modular home manufacturer Winalta Inc. has been given a court extension to come up with a restructuring plan, The Edmonton Journal reported. Edmonton Court of Queen’s Bench Friday agreed to extend the deadline to Aug. 6 while the Acheson company continues to dispose of assets. The company was granted court protection from creditors April 26 when it could not meet its debt obligations. The court has approved the sale of 29 homes and lots and three vacant lots at Sylvan Lake for $3.8 million, as well as 118 acres of residential property in Estevan, Sask. for $1.6 million.