Headlines

A U.S. federal agency has taken responsibility for pensions covering 23,000 American employees and retirees of Nortel Networks, which has been under court protection from its creditors since January, The Canadian Press reported. The Pension Benefit Guaranty Corp. announced the decision Friday from Washington and said it estimates the Nortel Networks Retirement Income Plan has assets worth only US$716 million, while its benefit liabilities are much higher at US$1.23 billion. The agency says it expects to cover the entire US$514-million shortfall for the company's U.S.

Controladora Comercial Mexicana SAB is holding debt restructuring talks with JPMorgan Chase & Co., said Francisco Galindo, an outside spokesman for the Mexican retailer. Comercial Mexicana officials are meeting with JPMorgan bankers in New York, Galindo said in a telephone interview. Comercial Mexicana owes JPMorgan and five other banks more than $1.5 billion stemming from peso derivative losses, Jose Calvillo, the executive at the retailer in charge of debt negotiations, said in an interview last month.

The U.K. insolvency accountancy profession is booming as the deepest recession in Britain since World War II pushes household names such as Woolworths Group Plc and Setanta Sports into administration, Bloomberg reported. A total 6,893 companies went into liquidation, receivership or administration in England and Wales in the first quarter of 2009, a 56 percent increase from the same period a year earlier, according to data on the U.K. Insolvency Service Web site. A record number of companies, 1,311, went into administration in the quarter.

The power struggle over beleaguered Stuttgart sports carmaker Porsche isn't one for the weak-kneed, BusinessWeek reported. After the company claimed on Wednesday that discussions about Volkswagen taking shares in the company had been taken off the table, new reports suggest that VW, Europe's biggest automobile manufacturer, is close to deal that would see it taking control of Porsche.

Newsprint giant AbitibiBowater has taken the first step towards becoming a leaner company by streamlining its management team as it looks to aggressively further reduce costs to address deteriorating market and economic conditions, The Canadian Press reported. The senior executive team has been reduced to six from nine people, with more head-office cuts to be announced in the coming weeks as the Montreal-based company restructures under court protection from creditors. The head office operation includes 750 people, including those under full-time contract.

Horst Piepenburg, a member of the insolvency administrator team of Arcandor AG, Thursday said he returned his mandate of a fully authorized representative of the company and three holding companies, Dow Jones reported. Piepenburg cited the "lack of support by Arcandor's large shareholder," private bank Sal. Oppenheim Jr. & Cie., as the reason for his decision.

Escada AG, the German maker of luxury women’s fashion, is at greater risk of insolvency as bondholders hesitate to exchange their notes for new ones, said Jonathan Moore, an analyst at Evolution Securities Ltd. About 37 percent of investors, fewer than half the quota needed by the end of the month, agreed to swap their bonds for a combination of cash and two new notes valued at 40 cents on the euro, Escada said July 14. The Munich-based company extended a cash bonus to the end of July for investors that back the swap.

Bankruptcy petitions in Hong Kong accelerated in June, surging 89 percent from a year earlier, government data showed on Friday, contrasting with other data suggesting the economy may be bottoming out, Reuters reported. Petitions also rose on a monthly basis after declining for the previous two months. Bankruptcy petitions totalled 1,619 last month, up from 857 a year ago and rising 14 percent from 1,417 in May, although monthly figures are not seasonally adjusted. The annual pace of increase was much faster than in May when petitions rose 54 percent from a year earlier.

Bankrupt Canadian oil company Oilexco said on Thursday it obtained a court order permitting it to liquidate the remainder of its assets and propose a plan of compromise and arrangement to its creditors, Reuters reported. The Calgary, Alberta-based oil explorer, which filed for protection in February under the Companies' Creditors Arrangement Act, said the net proceeds of the liquidation will be distributed to creditors in proportion to the amount of the proven claim. Oilexco said it expects to complete the liquidation by September 30.

Despite the string of mill closures and layoffs that have swept the province in recent months, Premier Shawn Graham says New Brunswick's forestry sector will emerge from the economic downturn ready for action, The TelegraphJournal reported. "We see other mills closing at a much more rapid rate in the state of Maine," he said Thursday.