A settlement has been reached to end a lengthy battle over divvying up the US$7.3 billion raised in Nortel Networks Corp’s bankruptcy liquidation.
The former Canadian technology giant filed for bankruptcy in 2009 following an accounting scandal. At its height from 1999 to 2000, Nortel was worth nearly $300 billion and employed more than 90,000 people globally.
The deal announced Wednesday follows years of courtroom battles over Nortel’s remaining assets, which mostly came from the sale of certain parts of the company when it folded.
Under the deal, Nortel’s Canadian debtors will receive about 57% of the sales proceeds, which amounts to about US $4.1 billion. US debtors will get 24%, or about $1.8 billion, and the remainder is expected to be paid to debtors in Europe.
The settlement which still needs approval in Canada, France, the United States and the United Kingdom would clear the way for pensioners and other creditors to receive payment.
The decision could bring some certainty for about 20,000 Nortel pensioners in Canada who have seen their benefits dramatically reduced since the bankruptcy filing in 2009.