Headlines

Air Canada said on Thursday that Aveos, its former aircraft maintenance firm, which sought creditor protection earlier this year, has been unable to drum up bids for its engine maintenance and airframe maintenance businesses, Reuters reported. Aveos Fleet Performance Inc, once the airline's maintenance division, halted operations in March and laid off roughly 2,600 workers, most of whom were employed at maintenance centers in the cities of Montreal, Winnipeg and Vancouver.

Defence technology company Metal Storm has been placed in voluntary administration. The company today said it had appointed Adam Shepard and Adam Farnsworth of Dean-Willcocks Shepard Recovery & Strategy as administrators, The Sydney Morning Herald reported. Metal Storm said it was hoped its business could be restructured or sold as a going concern. No details were given about the future of the company's workers.

The U.K.'s economy suffered a much larger contraction than expected in the second quarter, heightening questions about the pace and effectiveness of the government's austerity program and fueling the broader debate across Europe about how to tackle the Continent's economic woes, The Wall Street Journal reported. The deteriorating British economy is likely to intensify this debate both within the U.K. and other debt-laden countries in the West about cuts versus stimulus amid increasing evidence that austerity is proving a major drag on growth.

Greece may need a second debt restructuring to stay in the euro, a leading political ally of Chancellor Angela Merkel said. The comments by Norbert Barthle, the Christian Democratic Union’s parliamentary budget spokesman, are the first indication by a senior German official that additional help for Greece may be forthcoming to avert the market turmoil that would be triggered by its exit from the 17-nation currency region, Bloomberg reported. “We should try to keep Greece in the euro zone,” Barthle said by phone today.

The National Asset Management Agency (Nama) made a net profit of €247 million in 2011 after taking an impairment charge of €1.27 billion to cover bad loans, the Irish Times reported. Publishing its second annual report Wednesday, the agency said it made an operating profit, before loan impairment charges, of €1.28 billion last year, compared €305 million in 2010. As property prices continue to fall, the agency said last year’s impairment charge of €1.27 billion brought the total level of impairment on the agency’s loans to €2.75 billion, equivalent to over 9 per cent.

Romania's troubled state-owned power producer Hidroelectrica has cancelled most of the deals under which it sold electricity at below market prices, Economy Minister Daniel Chitoiu said on Wednesday, Reuters reported. Hidroelectrica, which has an installed capacity of 6,400 megawatts and is Romania's cheapest power producer, was declared insolvent last month, plagued by a previous drought and by its highly criticised contracts with a handful of companies that sell most of its output at below-market prices. "Up until now ...

The European Commission, the executive arm of the European Union, Wednesday approved state aid for two German state-controlled Landesbanken--BayernLB and NordLB--on the condition both banks undergo substantial restructuring in the coming years, Dow Jones reported. For BayernLB, the commission approved capital measures the bank received in 2008 and 2009 on the condition it would be fundamentally restructured and it repays 5 billion euros ($6.1 billion) of state aid over the next seven years.

Creditors of beleaguered Polish builder Polimex agreed on Wednesday to waive interest on the group's 2.5 billion zlotys ($718 million) debt pile for four months to give it time to restructure debt and improve liquidity, Reuters reported. Polimex is the largest of dozens of construction companies facing financial trouble after a bidding war for contracts to build roads for the Euro 2012 soccer championship Poland co-hosted with Ukraine. The deals they signed gave them razor-thin margins, which were eaten up by the rising cost of materials, leaving the firms carrying a loss on the projects.

Even as Germany tried Tuesday to brush off a warning that the cost of supporting its euro zone partners could damage Berlin’s stellar credit rating, market pressure was making it more likely that Spain could be the next euro member to need a helping hand, the International Herald Tribune reported. Germany, along with the Netherlands and Luxembourg, found themselves needing to defend their economic fundamentals after Moody’s Investors Service late Monday issued a “negative” outlook for those countries’ top-flight, triple-A credit ratings because of the risk of more euro zone bailouts.

Greece is unlikely to be able to pay what it owes and further debt restructuring is likely to be necessary, three EU officials said on Tuesday, a cost that would have to fall on the European Central Bank and euro zone governments. The officials said that twice bailed-out Greece would be found to be way off track by EU and International Monetary Fund officials who have been assessing the country.