Bankrupt Nortel, which once employed some 8,000 people in Research Triangle Park before its financial collapse, has reached a settlement worth nearly $67 million with retired U.S. employees and dependents over healthcare benefits.
The decision, which was filed in federal bankruptcy court in Delaware earlier this week, is one of the final moves being made by the former telecommunications giant as it liquidates all assets.
Under the settlement, retirees agreed to accept the money in exchange for the ending of benefits, according to reports from Dow Jones Daily Bankruptcy Review and Law360.
Last August, Nortel sought to terminate the benefits.
“The proposed settlement would tie up one of the final loose ends in the company’s protracted bankruptcy, a four-year period during which Nortel sold off nearly all of its assets but had been unable to reach terms with its retirees to consensually terminate their benefit plans,” Law360 reported.
The settlement is worth $66.9 million.
Nortel also has settled with former executives who had put funds into a retirement savings account, Dow Jones reported.
That deal is worth almost $31 million and enables the former executives to gain 97 percent of the funds they had saved as of the day Nortel filed for bankruptcy, according to Dow Jones.
Nortel filed for bankruptcy in 2009.
Still to be resolved are how to divide some $7 billion gained through asset sales, such as patents.
Nortel will meet with creditors in a mediation session starting Jan. 14 in Toronto.
The U.S. employee settlements are to be reviewed on Jan. 23 by the bankruptcy court.
