North America

Arclin, a closely held maker of resins and other construction-related materials, said on Monday it filed for bankruptcy protection in Canada and the United States and that it reached an agreement in principle to restructure its debt with some of its key lenders, Reuters reported. Under the terms of the agreement, Arclin will have its debt reduced to $60 million from $234 million, the company said in a statement. A post-petition financing facility of $25 million is also part of the deal.

The Harper government is facing growing pressure to intervene in the liquidation of Nortel Networks Corp., but shows no signs of supporting an effort by Research In Motion Ltd. to keep assets of the company in Canadian hands, The Globe and Mail reported. In a highly unusual move, Ontario Finance Minister Dwight Duncan joined federal opposition parties in urging Ottawa to act on the Nortel sale, with Mr. Duncan arguing the proposed $1.13-billion foreign acquisition of its wireless division should be blocked.

Nortel Networks, the bankrupt Canadian maker of telecommunications equipment, said over the weekend that Ericsson of Sweden had won an auction of its wireless technologies unit with an offer of $1.13 billion, thwarting a bid by a rival, Nokia Siemens Networks, The New York Times reported. Last month, Nortel signed a deal to sell the division, which is profitable, to Nokia Siemens for $650 million. A bank owned by the Canadian government also agreed to provide $300 million in financing for the deal.

Canadian officials have begun researching whether and what kind of foreign purchases of Nortel Networks assets might be subject to government restrictions, Industry Minister Tony Clement said on Thursday. He told Reuters he was not allowed to review purchases under the Investment Canada Act before there is an agreement, but he has directed his officials to examine what could be subject to the act. "I can't review anything until there is an agreement of purchase and sale, so that's not germane right now because there's still an auction going on," he said.

A unit of mining giant Grupo Mexico SAB is appealing a ruling that it is on the hook for $1.38 billion in cash and a stake in lucrative Peruvian copper operations to Asarco LLC, in a case alleging Grupo fraudulently shifted the shares, tipping Asarco into bankruptcy, Bankruptcy Law360 reported. Asarco first sued Grupo subsidiary Americas Mining Corp. in February 2007, arguing that Grupo Mexico's 2003 transfer of Asarco's 54.2 percent ownership in Southern Copper Corp., formerly Southern Peru Copper Corp., to AMC was fraudulent.

Lower revenue and bad debts pushed profit in the second quarter down 71 percent for Deutsche Post DHL, The Journal of Commerce reported. The world's biggest logistics company warned of tough market conditions ahead. The Bonn-based company, which ceased domestic express deliveries in the United States in January after mounting losses, forecast full year profit of $1.7 billion compared with $3.42 billion in 2008. It expects to post a net profit in 2009 thanks to cash proceeds from the sale of its banking unit, Deutsche Postbank.

Quebecor World has emerged from bankruptcy protection in the US and Canada, PrintWeek reported. In a statement, the print giant said it has effectively cancelled its shares and announced new issues of common shares, Class A Convertible preferred shares, and Series I and II Warrants. The new shares are expected to launch on the Toronto stock exchange within 30 days. It said it has drawn down some $540m from its $800m financing facility and has now fully paid back its debtor in possession credit facility.

Collins & Aikman Automotive Canada Inc. announced last week it applied for creditor protection under the Companies' Creditors Arrangement Act (Canada) in the Ontario Superior Court of Justice, Northumberland Today reported. "This (Companies' Creditors Arrangement Act) filing will allow the company to complete any potential sale transactions involving our Canadian Plastics operations," said John Boken, Collins & Aikman's chief restructuring officer.

Bankrupt Canadian telecommunications provider Nortel Networks Corp. has tapped Cleary Gottlieb Steen & Hamilton LLP to assist in the sale of its global Enterprise Solutions business to Avaya Inc. for $475 million, as the company continues to unload assets, Bankruptcy Law360 reported. Read more. (Subscription required.)

Several of Air Canada's employee unions want the Canadian government to put up all of the C$600 million ($545 million) the cash-strapped carrier needs to meet immediate financial obligations, and shut out private lenders. The unions are concerned that lucrative landing slots, which it said the company has proposed putting up as part of collateral for loans, could end up in private hands and then be sold, said Katherine Thompson, spokeswoman for the Air Canada component of the Canadian Union of Public Employees (CUPE).