Nortel Networks Corporation, October 12, 2016
October 12, 2016
After nearly 8 years of skirmishing among stakeholders, and financial hardship suffered by our constituents, the Court-appointed Representatives, together with the NRPC and CNELTD, are very happy that a settlement has been reached which will pave the way to finally putting money into people’s pockets.
The victories secured in court, especially over the last two years, were the catalyst to this settlement which yields substantially more than any creditor group was prepared to concede in court to Canadian creditors.
The allocation of the roughly US $7.3 billion collected from the sales of Nortel’s worldwide businesses (the “lockbox”) has been settled, with some conditions. Pursuant to the Global Settlement and Support Agreement, the Canadian Estate will receive approximately 57% of the lockbox (US $4.143 billion). Some of the proceeds will be converted to Canadian dollars, and together with the funds currently in the Canadian Estate, will be made available to Canadian creditors through the claims process.
The Global Settlement and Support Agreement is subject to certain conditions, including CCAA and Chapter 11 plans to be voted on by creditors in the Canadian and US Estates and court approval in Canada, the US and Europe.
Assuming that all conditions are satisfied, the Monitor of the Canadian Estate estimate that a payment on claims will be made in the first half of 2017.
In addition, to access the Koskie Minsky Legal Update slides which are being presented at the Managerial Plan wind up roadshows please click here.
For background information regarding the Allocation Litigation and other litigation please click here.
We will continue to provide information as it becomes available, including projections of the percentage amount to be distributed to creditors – including pensioners, former and disabled employees – on their claims.