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In a statement late Tuesday, Ontario’s Chief Justice Warren Winkler, who was appointed by bankruptcy judges in Canada and the United States to broker a deal among many creditors, said mediation has been extended but no new deadline set.
Two previous attempts at mediation among Nortel’s creditors, who span all continents except Antarctica, failed.
The task is to find agreement among all the parties. The proceeds for the selloff of Nortel’s assets including patent sales totaled about $ 9 billion. That pales in comparison to the claims from creditors, exceeding more than $ 20 billion (U.S.), and by some estimates could reach as much as $ 36 billion (U.S.), according to Bloomberg.
If the parties chose to go down the road of litigation, Winkler said any Nortel assets now available would be depleted, and the case would be tied up for years. “This would be a catastrophic outcome for some, and unsatisfactory for most, of those affected by this case,” he said in his opening remarks.
At one time, Nortel Networks was touted as a Canadian success story, a stock market darling and the highest-valued company trading on Toronto exchange. At its peak, it traded at $ 124.50 in 2000, before eventually falling to penny-stock status.