Headlines

Timbercorp has gone into voluntary administration, owing $562.9 million, the Herald Sun reported. Rural investment experts told BusinessDaily today that they felt the collapse was only a matter of time after the announcement last week by chief executive Sol Rabinowicz that Timbercorp had fully drawn up to $367 million in bank loans. Directors called in administrators Mark Korda and Leanne Chesser of KordaMentha early this morning. The company owns hundreds of thousands of acres of plantations, including Australia's biggest olive grove at Boort, in Victoria's north.

Fiat will sign on Tuesday a letter of intent to buy a majority stake in General Motors' struggling Opel unit, the website of German magazine Spiegel said on Thursday, citing sources. GM is also in constructive talks with Austria's Magna Steyr, said the website, without saying where it obtained the information. The carmaker and Germany's economy ministry prefer a speedy agreement with Fiat, reported Spiegel Online, which has separate editorial staff from the magazine. It cited people close to the negotiations.

More companies will be able to hold their hands out for taxpayer help to retain staff after the government announced an expansion of the nine-day fortnight scheme today, The National Business Review reported. Prime Minister John Key says that businesses that employ between 50 and 100 workers will now be able to sign up to the Job Support Scheme. The scheme, which lets private sector businesses negotiate voluntary agreements with employees to reduce their working hours to a nine-day fortnight, was previously restricted to businesses employing more than 100 people.

U.S. and European banks need to raise $875 billion in equity by next year to return to levels similar to the years before the current crisis--and twice that amount to match the levels of the mid-1990s, the International Monetary Fund said. The steep funding requirements reflect a financial crisis that continues to deepen, the IMF said. The banking sector's woes have spread from the housing sector to commercial real-estate loans and emerging-market debt, The Wall Street Journal reported.

Spain's government on Wednesday said it would restructure the Spanish banking system as one lobby group warned of "catastrophic" risks without contingency plans to deal with further bank bailouts, Reuters reported. "We shall start a process of restructuring with them (credit institutions) to strengthen the system," Economy Minister Elena Salgado said on Wednesday in the Spanish parliament.

The governments of Canada and Ontario are in advanced negotiations to provide unprecedented bankruptcy financing for the Canadian operations of General Motors Corp. and Chrysler LLC, The Globe and Mail reported. According to people familiar with the matter, federal and provincial officials are in the final stages of discussions with the U.S. Treasury and senior auto executives toward a contribution of as much as $6 billion (U.S.) for unique cross-border financing that would see GM and Chrysler through the initial phases of creditor protection.

Mexican paper manufacturer Corporacion Durango SAB, or Codusa, said Wednesday it has signed a debt restructuring agreement with a majority of its creditors that reduces its bond debt by more than half, Dow Jones Newswires reported. Once the restructuring is completed, the current controlling shareholder group will continue, directly or indirectly, to have a majority of Codusa shares, the company said. Codusa said existing and future inter-company debts will be subordinate to the new notes, and won't result in cash payments from the holding company.

Tahera Diamond Corp said on Wednesday it will try to raise up to C$40 million ($32 million) in an attempt to either reopen its Jericho diamond mine in Canada's Arctic or sell the asset, Reuters reported. The company shut the money-losing mine last year and left the property to be taken over the Canadian government after Tahera ran out of funds and failed to find a buyer. Tahera, which has been operating under bankruptcy protection, said in a statement it had entered into an agreement with Cormark Securities for potential equity or debt financing to raise between C$30 million and C$40 million.

Stanford Financial Group’s Antiguan receiver is asking a U.S. federal judge to let it go after assets in the U.S. by putting part of the company into bankruptcy, the Houston Chronicle reported. Nigel Hamilton-Smith, the Antiguan receiver claiming authority over Stanford International Bank in the Caribbean island nation, said in a filing he should have full responsibility over assets and liabilities tied to the bank, including the certificates of deposit that are at the center of claims the company was a massive Ponzi scheme.

Quebecor World filed a reorganization plan with a U.S. court aimed at recapitalizing the printer of Time and Cosmopolitan magazines to allow it to emerge from creditor protection by mid-July, Reuters reported. The Montreal-based commercial printer said late on Monday that a U.S. bankruptcy court would hear the plan on May 15, with details of what creditors will be able to recover released 10 days prior to the court hearing.