Report: Canada’s Nortel to seek protection
Canada’s once-mighty Nortel Networks Corp. was poised to seek bankruptcy protection in Toronto and the United States, the Globe and Mail reported.
Sources who asked not to be identified told the newspaper the board of directors was expected to make the announcement Wednesday as $107 million in interest on debts came due.
Nortel is North America’s largest telecom equipment maker, but is likely to be broken up and sold to foreign rivals, the sources said.
The company has an estimated $1 billion on hand, but $4.5-billion in long-term debt, the newspaper said.
In 2000, the company had 95,000 employees and its shares were worth $1,231, but as of Tuesday, there were 26,000 staff and shares closed at 38.5 cents on the Toronto Stock Exchange, the Globe said.
Where in the United States the company planned to file for Chapter 11 protection wasn’t disclosed.
The company was founded in 1895 as Northern Electric Manufacturing Co.