North America

Although Chrysler Canada has no plans to follow the lead of its parent company and file for bankruptcy protection, the head of the Canadian Auto Workers says its plants will be forced to close until the company's U.S. court-supervised restructuring is complete, The Canadian Press reported. Chrysler LLC said Thursday it will temporarily stop most of its vehicle production until it has completed a technology-sharing alliance with Fiat--a cornerstone of its restructuring plan. The shutdown is effective Monday and could last between 30 and 60 days.

Fiat quietly ended its effort to market cars in the United States a quarter-century ago when the last of its vehicles to carry the Fiat nameplate, the 1983 Brava sedan, drove off a dealer lot. They had stylish exteriors and responsive handling, but Fiats were notoriously unreliable. This time around, the Italian automaker is hoping to make a more favorable and lasting impression on American consumers, with much-improved, fuel-efficient cars that could roll off the assembly lines of its new partner, Chrysler, in as little as 18 months, The New York Times reported.

The court-appointed liquidator for Clico Bahamas Ltd., a Bahamian life and health insurance company owned by one of the largest financial conglomerates in the Caribbean, has filed a Chapter 15 bankruptcy petition seeking permission to investigate the company's U.S. assets, including at least $70 million Clico invested in several South Florida real estate developments, Bankruptcy Law360 reported.

Chrysler LLC is expected to file for bankruptcy protection in the United States by the end of the week and the Canadian and Ontario governments will jump in to help backstop the company with financing that will enable it to keep making and selling cars while it restructures, sources said. The bankruptcy filing is expected even though a deal by Fiat SpA to create a strategic alliance with the No.

Nortel Networks Corp., the insolvent telephone-gear maker, won an extra three months to work out a plan that will allow the company to emerge from bankruptcy, Bloomberg reported. Ontario Superior Court Judge Geoffrey Morawetz today agreed to extend the order, which was due to expire May 1, to July 30, following a hearing in Toronto. The order protects the Toronto- based company from creditor demands and lawsuits. Nortel filed for bankruptcy in January in the U.S. and Canada after losing almost $7 billion since 2005.

Nortel Networks Corp. needs its protection from bankruptcy extended to July 30, says the court-appointed monitor in the telecom equipment maker's Canadian insolvency proceedings. The current extension of Nortel's stay under the Companies' Creditors Arrangement Act ends May 1, and Nortel is seeking a further 90-day period of shelter from creditors, The Canadian Press reported.

General Motors of Canada Ltd. (GM), following its U.S. parent's lead Monday, detailed additional restructuring moves including cutting its hourly workforce by almost 6,000 by 2014 and reducing its dealer networks by 42% by the end of 2010, Dow Jones Newswires reported. The General Motors Corp. (GM) unit said it's continuing to work with the Canadian and Ontario governments and expects to soon complete a short-term bridge-loan agreement. GM Canada is required to provide an updated restructuring plan by May 30 to be eligible for government financial assistance.

The Canadian unit of Chrysler may not need to seek bankruptcy protection, even if the company does so in the United States, Canadian Finance Minister Jim Flaherty said on Saturday. Flaherty said the automaker's cost-cutting agreement with the Canadian Auto Workers union, announced late Friday, represented a "fundamental change" in the company's efforts to qualify for emergency government loans, Reuters reported. The company must also clinch a partnership with Fiat SpA. "The legal situation may be different in Canada than in the United States.

A judge has signed off on a deal to allow India-based Sterlite Industries Ltd. to buy bankrupt mining firm Asarco LLC for $1.7 billion, while leaving the door open for Asarco parent Grupo Mexico SAB to file a competing plan, Bankruptcy Law360 reported. Read more. (Subscription required.)

Canada is preparing contingency plans in case General Motors Corp. and Chrysler LLC seek bankruptcy protection, Industry Minister Tony Clement said. “We have made a lot of contingency plans,” Clement told reporters in Ottawa today. “Our plan A is moving forward outside of bankruptcy protection, but there are plan Bs and plan Cs, and that’s responsible to protect taxpayers,” Bloomberg reported. The Canadian and Ontario governments are in discussions with the U.S.