Turnaround efforts continue for Australia's NewSat Ltd., according to Ken Coleman, the lawyer representing insolvency officials trying to hold the company together after it was forced to terminate a contract with Lockheed Martin Corp., Dow Jones Daily Bankruptcy Review reported today. Lenders pushed NewSat into court-supervised insolvency proceedings in Australia earlier this year after it defaulted on loans. Cost overruns on the Jabiru-1 satellite project and management issues were also cited as the reasons for NewSat's financial problems. Administrators put in charge of NewSat sought U.S. court aid to save the construction contract for the Jabiru-1. However, the money didn't come through in time, and last week, NewSat surrendered its rights under the contract with Lockheed Martin. The Australian insolvency proceeding will be the main forum of action for NewSat's turnaround bid, the U.S. court said Friday, in a formal recognition order signed by U.S. Bankruptcy Court Judge Laurie Selber Silverstein. The recognition order was uncontested, and it was the main goal of NewSat's chapter 15 bankruptcy filing, which followed shortly after the Australian insolvency action commenced. Read more. (Subscription required.)
For more further analysis of chapter 15 proceedings, be sure to pick up a copy of ABI’s Chapter 15 for Foreign Debtors.