Headlines

A Chinese court has declared bankrupt the company at the center of a scandal over tainted milk, blamed for killing six children and sickening almost 300,000 more, one of the company's owners said Wednesday. New Zealand's Fonterra Group said that a court in Shijiazhuang, in China's Hebei province, had issued a bankruptcy order against Sanlu Group Co. in response to a petition from a creditor, the Associated Press reported. The receiver will have six months to conclude the sale process.

Alitalia SpA’s bankruptcy administrator is seeking buyers for 46 planes that investor group CAI isn’t acquiring so the insolvent airline can repay creditors, Bloomberg reported. The Rome-based carrier called for expressions of interest in an advertisement published on the Financial Times and Il Sole 24 Ore newspapers, as well as its Web site. The aircraft include two Boeing Co. 767 planes, 17 MD-80s and five MD-82s. The bankruptcy administrator needs to sell unprofitable assets and reduce the company’s debt as Alitalia is broken up and CAI buys the carrier’s main flight business.

Pakistan stocks tumbled for an eighth day, extending a 25 percent drop the past month, on increasing concern brokerages may be forced out of business, Bloomberg reported. Trading was suspended yesterday for 20 firms at risk of defaulting on share transactions after a court ordered the nation’s 200 brokerages to provide 50 million rupees ($634,000) each in bank guarantees to keep operating. Equities have been falling since the stock exchange, the target of investor protests in July after the worst market tumble in 18 years, ended four-month-old trading curbs on Dec. 15.

Britain's economic downturn claimed another prominent retailer Wednesday as music, games and DVD retail chain Zavvi filed for a form of bankruptcy protection, blaming the collapse of the Woolworth Group's distribution arm, the Associated Press reported. Ernst & Young administrators, appointed to run the company, said that they would continue to trade "with a view to selling all or part of its business as a going concern." Zavvi, created by a management buyout of the Virgin Megastores just over a year ago, is Britain's largest independent entertainment retailer.

The majority of The Officers Club's menswear stores were sold on Wednesday, a day after the company went into administration, the Associated Press reported. The deal will save more than 1,000 jobs, but adds yet another name to the growing list of British retailers that have failed to survive the financial downturn. TimeC 1215 Ltd., a new company backed by The Officers Club's chief executive, David Charlton, bought 118 of the retailer's 150 stores for an undisclosed sum. PricewaterhouseCoopers put the chain up for sale after it went into administration on Tuesday.

The Serious Fraud Office (SFO) is investigating finance company Nathans Finance, which went into receivership in August 2007, The National Business Review reported. SFO director Grant Liddell said the investigation followed a complaint made by the receivers PricewaterhouseCoopers. Confirmation of the SFO investigation comes a day after the Securities Commission announced it had laid charges against the directors of Nathans Finance, alleging they misled investors by making false statements in company prospectuses.

Pawn shops, banned during more than three decades of Communist rule from 1956 to 1987, are making a comeback as China’s government tries to ease the credit crunch that is strangling small businesses, Bloomberg reported. In 1997, Beijing only had four pawn shops. This year, Beijing and Shanghai authorized a record 94 new outlets for 2009 in an effort to channel funds to the entrepreneurs who drove the nation’s biggest economic boom, according to the Beijing Pawn Trade Association and Shanghai Pawn Trade Association.

Whittard of Chelsea, a British tea and coffee merchant, is likely to be sold this week, a person close to talks said Tuesday after British media reported the Icelandic-owned company was in trouble. Several potential buyers have been in talks with Whittard but one offer has come out "more strongly than the others," according to a spokeswoman who spoke on condition of anonymity because the sale was not yet finalized. British media reported Whittard could be placed into administration and that Ernst & Young would be the administrator.

India’s textile industry, much of it concentrated in the southern state of Tamil Nadu, is suffering as global demand wanes. Textile factories, including India's notorious garment-making sweatshops, are among the country's first manufacturing businesses to feel the effects as American and European clothing retailers slash orders amid slumping consumer spending. India's second-largest employers after agriculture, textile concerns employed 35 million workers last year.

South Korea will form a task force to assess the finances of construction firms and smaller shipbuilders and will force unviable companies to restructure, the financial watchdog said Tuesday. The Financial Supervisory Service (FSS) said banks would immediately form the task force with accounting experts and credit appraisers, Agence France-Presse reported.