Defunct telecoms organisation Nortel Networks has reached an agreement to pay $37.5 million (£23 million) into its UK pension scheme to settle claims against relevant Nortel parties in the United States.
Papers were filed on 17 December in the United States Bankruptcy Court providing details of a conditional agreement between the trustee, together with the Pension Protection Fund, and the relevant Nortel parties in the United States.
The agreement stated that, in exchange for releasing all the UK pension scheme’s claims against the US parties, it will be allowed an ‘administrative expense priority claim’ against Nortel Networks to the sum of $37.5 million (£23 million).
An additional and equal settlement sum is being paid to the joint administrators of the Europe, Middle East and Africa (EMEA) estate, and through that estate, a large part of that second sum will eventually come to the pension scheme as a result of its claim into Nortel Networks UK.
The sums are payable in full by the US parties immediately following the necessary court approvals in the US and the UK.
A statement by the Nortel Networks UK Pension Plan, said: “Subject to the Court approvals, we would therefore expect to receive the funds during the course of the next month or so.
“The foregoing has no effect on our claims in Canada or the allocation of Nortel assets between Nortel companies in the US, Canada and Europe.”