Thursday, January 15, 2009

Nortel files for bankruptcy. Good news is that its customers opt to stay.

NORTEL Networks Corp - the telephone equipment maker once worth US$250 billion at its peak - has filed for bankruptcy protection, as it continues to make losses due to competition and weakening economy.

The company's chief executive officer Mike Zafirovski contacted customers yesterday, to reassure that operations remains as usual.

Nortel shares, which closed at a high of C$1,231 ($987) inJuly 2000, fell 27 cents to 12 cents yesterday on the TorontoStock Exchange. A year ago, the stock closed at C$12.89. The stocks have depreciated by 99 per cent in the past year.

Some of the interesting quotes in the Bloomberg report:

“It’s the end of a saga...I’m sad to see it happen but the tears were shed many months ago,” said Benoit Lalonde, vice president of fixed income at Laurentian Bank Securities, a unit of Canada’s seventh-largest bank. Laurentian doesn’t own Nortel debt.

“This is not about the end of Nortel...This is about the beginning of a new Nortel,” Derrick Tay, the company’s lawyer, said at a hearing in Toronto.

For the full story:



blogger templates | Make Money Online