Headlines

Kazakhstan sought to reassure investors on Wednesday that none of its banks would default on foreign debt although some bilateral loans may be restructured, the Guardian reported. Central bank Governor Anvar Saidenov said he was confident none of the local banks would default on its obligations. Kazakhstan has been hit badly by the global financial crisis and has announced a $21 billion aid package--roughly equivalent to 20 percent of gross domestic product--to help its oil-fuelled economy.

Scandinavia-focused marketing support company Delling Group Plc said on Wednesday it had put its Swedish operations into administrative receivership following a strategic review of its operations, and its shares fell 52 percent, Reuters reported. Chief executive Geir Lolleng resigned effective Wednesday, and a new managing director for the Swedish operation was being recruited internally, the company said. The Swedish operation has around 70 employees and represents about 60 percent of Delling's business volume, it said.

Ecuador sees falling oil prices as a determining factor in its decision on whether to service foreign debt that the leftist government deems "illegal," Minister of Politics Ricardo Patino told Reuters on Monday. Patino, one of President Rafael Correa's closet allies, said a restructuring of the country's Global bonds was less likely now as the government plans to decide on whether it will keep servicing or default on the debt this week.

Sony Corp., the world’s second-biggest consumer-electronics maker, plans to eliminate 16,000 jobs in the largest reduction announced by a Japanese company since the credit crunch drove the world into recession, Bloomberg reported. Sony will curb investments, outsource production and move away from unprofitable businesses by March 2010 as part of plans to save more than 100 billion yen ($1.1 billion) a year, the company said today. The job eliminations include 8,000 permanent positions, or 5 percent of the company’s electronics workforce, and 8,000 temporary workers, it said.

TMD Friction's German companies filed for insolvency yesterday as the auto supply group became the latest victim of the global downturn, the Financial Times reported. The private Luxembourg-registered group, the industry's second-biggest supplier of brake pads and linings after America's Federal-Mogul, said the rapid slowdown in the industry had "led to a very high level of pressure on our cash flow." Its owners are looking to sell the business, and are in talks with potential private equity investors, according to its chief executive.

Hanover investors have put their faith in the company’s shareholders and management to deliver a better outcome than receivership, The National Business Review reported Tuesday. The vote on the controversial restructuring plan today went overwhelmingly in Hanover’s favour, with nearly 93% of Hanover Finance investors approving the plan. Over 70% of debenture holders (by value) voted. Other classes of Hanover group investors were also supportive of the plan. A last-ditch attempt by a Hanover investor to gain an injunction to postpone the vote failed Monday night.

EMI, the music label whose artists include Lily Allen and Coldplay, moved to calm fears that it was in trouble yesterday as insiders denied it could default on its £2.7 billion loans early next year, The Independent reported. The group, bought by private equity company Terra Firma for £2.4 billion in 2007, denied suggestions that it needed more cash to avoid breaching covenants in three months. Terra Firma, run by Guy Hands, has a covenant check scheduled for March but sources on both sides are confident that EMI will not default on the loans made by its banker Citigroup.

Upmarket suit and shirt retailer Herringbone, which is favoured by financial sector workers, has gone into voluntary administration after a falloff in sales, The Age reported. Martin Green of BRI Ferrier was appointed administrator of Herringbone Retail Pty Ltd and Herringbone Staff Pty Ltd on Sunday. The decision to appoint the administrator was taken by the directors of Herringbone following a recent slump in sales and a downturn in forecasts for the balance of the calendar year.

Private equity-owned Henniges Automotive Grefrath and its associated technical center has gone into receivership, along with a Czech subsidiary, Plasteurope.com reported. Affected are around 2,000 employees. Production at the four sites manufacturing EPDM, TPE, TPV and PVC glassrun and door seals for vehicles is continuing, and the administrator, Wolf-Rüdiger von der Fecht of Dusseldorf firm Metzeler-Vonder Fecht, plans to talk to the three main OEM customers about new projects. Order books are said to be well filled, but jobs are still expected to be lost. A sale of the company is targeted.

Chrysler Canada Inc has warned that it could shift production from two of its plants in Ontario to the United States, cutting more than 8,000 Canadian jobs, if it fails to get the C$1.6 billion ($1.27 billion) it needs in emergency aid from the federal and provincial governments, the Globe and Mail newspaper reported on Tuesday.