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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. 

Argentine bonds issued under local law, which have continued to get paid after the country’s July default, declined after hedge fund Aurelius Capital Management said that it’s seeking to block the payments, Bloomberg News reported yesterday. The nation’s 2024 bonds reversed earlier gains and slid 0.25 cent to 98.17 cents on the dollar, pushing yields up 0.05 percentage point to 9.1 percent. Aurelius claims that Argentina’s $1.4 billion of bonds sold in April are subject to U.S. District Court Judge Thomas Griesa’s ruling, which says that some of the country’s performing bonds are subject to equal treatment, or pari passu, with defaulted debt. That means they can’t be serviced unless the nation also pays defaulted bonds from 2001. Aurelius argued Argentine bonds due 2024 should be included in the ruling because they were marketed abroad by Deutsche Bank AG. Economy Minister Axel Kicillof said the April 21 sale of so-called Bonar 24s proved Argentina has access to international financing even after its July default.

A bankruptcy judge in New York agreed to recognize shipper Daebo International Shipping Co.’s foreign bankruptcy proceeding, which will help protect the company’s U.S.-based assets from creditors while the Korean dry bulk ship operator restructures abroad, the Wall Street Journal reported today. Following a hearing Friday, Judge Michael E. Wiles signed off on the shipping company’s request for chapter 15 protection. The judge’s order follows an agreement Daebo reached with a group of creditors over one of its ships, named Daebo Trader. The vessel was seized by court order Feb. 15 while it was docked in New Orleans, after a stevedoring company brought claims of about $1.6 million against Daebo for unpaid stevedoring services, or the loading and unloading of cargo. At least three other creditor lawsuits have been filed against Daebo, seeking a total of more than $1 million in claims secured by the ship, court papers show. Under the agreement approved by Judge Wiles, Daebo posted a special bond of $3.85 million that will be used to pay any successful creditor claims and allow the Daebo Trader to deliver a shipment of soybeans and to avoid further losses. Read more. (Subscription required.)

For more information on cross-border proceedings, be sure to pick up a copy of ABI’s Chapter 15 for Foreign Debtors.

The Canadian and U.S. judges charged with dividing the $7.3 billion from the liquidation of Nortel Networks rejected proposals from former regional businesses and opted for a pro rata split of the money, Reuters reported yesterday. Judges on the U.S. Bankruptcy Court in Wilmington, Del., and Ontario Superior Court of Justice held an unprecedented joint cross-border trial on the dispute, with the courtrooms linked by video. Nortel filed for bankruptcy in 2009 and sold its global operations and patents, raising the cash in dispute. In the years that corporate entities in Canada, the United States and Europe have fought over the funds, retirees and bond investors have awaited repayment. Bankruptcy Judge Kevin Gross and Justice Frank Newbould said in separate opinions that each regional business would receive cash to pay its creditors based on their claims against it as a percentage of the overall claims worldwide. The judges said in their simultaneous opinions that a pro rata division was the most fair and satisfactory way to split the money.  Read more.

For more information on cross-border proceedings, be sure to pick up a copy of ABI’s Chapter 15 for Foreign Debtors.