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Defunct Canadian cryptocurrency exchange owner Quadriga Fintech Solutions Corp. should be shifted out of restructuring into bankruptcy proceedings to help cut costs and facilitate the recovery of assets for creditors, the company’s court-appointed monitor said, Bloomberg News reported. The Vancouver-based exchange owes about 115,000 clients some C$260 million ($195 million) after its founder Gerald Cotten died in December without telling anyone how to recover the cryptocurrencies held for clients. Quadriga’s platform was shut down on Jan. 28 and entered into creditor protection in early February. The chance of it emerging from restructuring "appears remote" and the investigation to recover assets can be handled more efficiently in bankruptcy, monitor Ernst & Young said in a report dated April 1. Bankruptcy would be more cost effective and would also allow the trustee more investigatory powers, including the right to compel production of documents and seek examination of parties under oath, Ernst & Young said. It would also allow for the potential sale of assets, such as Quadriga’s operating platform, it added.

Even as Venezuela’s political stalemate drags on, the country’s options for the potential restructuring of more than $175 billion in foreign debt are coming into focus as lawyers, academics and government officials debate the proper approach, the Wall Street Journal reported. Legal and financial advisers to Venezuela’s largest known group of U.S. bondholders released a paper on Thursday proposing a road map for sorting out the country’s massive debts after the potential ouster of authoritarian leader Nicolás Maduro. Discussions among U.S. bankruptcy experts have revolved around two potential strategies for sorting out who gets paid what, according to the paper’s authors, Richard Cooper of law firm Cleary Gottlieb Steen & Hamilton LLP and Mark Walker of financial adviser Guggenheim Securities LLC. Either the White House takes executive action against creditors, or Venezuela enacts a local restructuring law capable of being honored by U.S. bankruptcy courts.

Icelandic budget carrier Wow Air has ceased operations and canceled its flights, leaving passengers stranded on both sides of the Atlantic, CNN.com reported. The airline announced the closure in a statement posted to its website on Thursday. It advised passengers to book new flights on other airlines, and said some may be eligible for compensation. Wow Air CEO Skúli Mogensen told Icelandic state broadcaster RUV that negotiations to save the airline went on until the early morning in Iceland. "As is normal, people believed we would get the investment," Mogensen told RUV. "We have been very transparent, but it didn't happen." Mogensen said more than 1,000 passengers had been affected by the grounding of aircraft. He said he didn't have an exact figure on the number of tickets that had been sold. "I'm very sorry about this as these are people who have supported us," said Mogensen. "I'm disappointed not to honor our commitments."

A bankruptcy judge said yesterday that he would approve Mercuria Energy Group Ltd.’s takeover of troubled marine fuel supplier Aegean Marine Petroleum Network Inc., the Wall Street Journal reported. Bankruptcy Judge Michael Wiles said during a hearing that he would confirm Aegean Marine’s chapter 11 plan. The decision clears Aegean Marine to exit bankruptcy, which the company sought in early November after an audit committee disclosed a $300 million hole in its books. Under the plan, Mercuria will swap out loans for 100 percent of the equity in Aegean Marine’s common stock upon emerging from chapter 11, court papers say. Overall, Aegean Marine said Mercuria’s decision to equitize bankruptcy loans and other secured debt will deleverage the company’s balance sheet by more than $800 million.

EU ambassadors today backed new rules to facilitate banks’ sales of bad loans on their books but failed to agree on a reform that would make it easier for lenders to recover assets from borrowers who default, Reuters reported. The proposed rules are part of a wider overhaul of EU banking rules and aim to accelerate banks’ efforts to offload soured loans, which have reduced European banks’ ability to lend to households and companies since the 2007-09 global financial crisis. The agreement reached today is expected to favor the purchase and servicing of so-called non-performing loans (NPLs) “which will lead to the development of efficient secondary markets,” said Romania’s Finance Minister Eugen Teodorovici, who chaired the negotiations among the 28 EU countries. Under the overhaul, which still needs to be finalised in agreement with the European Parliament, financial companies specialized in buying bad loans, such as private equity giant Blackstone and asset manager Cerberus, are set to gain easier access to NPLs across EU states. Read more. 

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Jet Airways Chairman Naresh Goyal will step down from the board of the Indian carrier he founded 25 years ago and its lenders will seize control, the company said, as part of a deal led by state-run banks to save the airline from bankruptcy, Reuters reported. Saddled with debt of more than $1 billion, Jet has been on the brink of collapse, and had to ground more than two-thirds of its fleet as it struggled pay lenders, suppliers, pilots and leasing companies. Banks have moved in to take a majority stake in the airline after Jet failed to convince potential investors, including its largest shareholder Etihad Airways, to save the airline. Goyal’s departure, however, could reignite investor interest in India’s oldest private airline. Sources told Reuters in November that Tata Sons had been in active talks to invest in Jet on the condition that Goyal would step down or take a less prominent role.

Philip Morris International Inc.’s Canadian division received creditor protection in Canada, a move that holds off legal action against the largest tobacco company in the country, Bloomberg News reported. Rothmans, Benson & Hedges Inc. was granted protection by the Ontario Superior Court under Canada’s Companies’ Creditors Arrangement Act, the Canadian division said on Friday in a statement. The move includes an initial order to stay proceedings in a Quebec class action suit and other pending litigation, including those brought by all 10 Canadian provinces tied to the recovery of health-care costs, the company said. Class action lawsuits filed by Quebec smokers already prompted two other tobacco companies to seek creditor protection after they were ordered to pay damages of about C$17 billion ($12.7 billion). British American Tobacco Plc, Philip Morris and a local unit of Japan Tobacco Inc. are defendants in lawsuits by Canada’s 10 provinces that want to recoup health-care costs linked to the effects of smoking, a move reminiscent of the U.S. in the 1990s. The first of these cases, some of which date back almost two decades, is scheduled to come to trial this year.

British American Tobacco PLC put one of Canada’s top cigarette distributors into bankruptcy protection in the U.S. after that subsidiary, sued by Quebec smokers in 1998 for hiding health risks, was ordered to pay 9.2 billion Canadian dollars (US$6.9 billion), <em>WSJ Pro Bankruptcy</em> reported. Officials who put Imperial Tobacco Canada Ltd. into chapter 15 protection in U.S. Bankruptcy Court in New York said the move is meant to stop creditors from taking the tobacco held at the company’s Ohio and Montana warehouses while it negotiates a payment plan. Tobacco for its cigarettes, grown in Mexico, is stored in those warehouses as part of its importing process. Company officials added in court-filed documents that if legally operating distributors such as Imperial Tobacco shut down, operators that sell untaxed tobacco illegally “will expand to fill the void in the marketplace.” More Canadians are buying illegal tobacco, they said. Judge Shelley Chapman later agreed to temporarily block seizures.