In a move that it called a "significant milestone" in its five-year bankruptcy, Nortel Networks said it has reached a deal to cut more than $3 billion owed to former Nortel entities in Europe, including bondholders, retirees and suppliers.
The deal requires administrators of insolvent European Nortel entities and a pension trustee to withdraw their claims against the defunct telecom vendor. In exchange, each would get high-priority administration claims for $37.5 million, a story in ABS-CBNNews said.
A filing in the U.S. Bankruptcy Court in Wilmington, Del., called the settlement "a critical step forward by the parties to resolve the costly and contentious litigation amongst the Nortel affiliates."
As another part of the deal, the involved parties agreed to work together to divvy up $7.5 billion raised by liquidating a company that once employed 93,000 workers worldwide and was reportedly worth $250 billion.
- ABS-CBNNews has this story
3 former Nortel execs acquitted of fraud charges
Mike Zafirovski, Nortel Networks
Nortel's $4.5B patent sale could be delayed
Nortel, GENBAND come to blows over CVAS deal