Nortel Workers Threaten To Blow Up Factory Unless They Get Decent Layoffs

Liquidating Nortel has more troubles to add to its plate. Not only is the Canadian firm seeing a major push back to its liquidation plans by recently notorious private equity firm MatlinPatterson, which refuses to go gently into that good night and write off its $400 million investment in the failed telecom maker, but now it has to deal with its own employees who have threatened to blow up a French plant unless they get preferential layoff terms. The Globe and Mail reports that "workers had placed gas cylinders in front of the plant in the Yvelines area near Paris, where 480 jobs are set to be axed following bankruptcy proceedings."

From the article:

In the second threat by French workers to blow up a factory in a week, the paper said the workers had threatened to stage an explosion as early as Wednesday if their demands were not met, but said the gas cylinders were empty.

No immediate comment was available from Toronto-based Nortel, once the largest North American telecommunications equipment manufacturer but which filed for bankruptcy protection in Canada and the United States in January.

The workers were also bitter about the way the authorities handling the case in France were proceeding, the paper said.

“We are exasperated by the practices of the administrator. A meeting was planned yesterday, but it was cancelled at the last minute,” the paper cited one union member as saying on Tuesday.

“It is not the first time. They have been stringing us along for four days. They have no respect for us,” the union member said.

Speaking on LCI television, Labour Minister Xavier Darcos pledged to find solutions for the workers.

“We are going to speak to each other, we will find solutions that do not require resorting to extreme violence,” he said.

It seems the French have gotten the upper hand in counter-Rattnerian negotiating tactics. It is yet to be seen if comparable "negotiations" are pursued by the millions of business owners who will have no further recourse to loans by soon to be bankrupt lender CIT.

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Citi Lives the Telecom Dream as Nortel is About to Wake

It is good to see that even as the good men leaving the yellow van carrying a straight jacket (specifically outfitted with a bro/manzier for obvious purposes) are climbing up the arduous 59 story staircase to the top of Citigroup Center (the elevator bouncers are there of course not just to accept TARP funding with open 24 inch pythons but to keep any semblance of the real world out), to prevent Count Vikula from self-inflicting any further acts of razor-sharp, efficient capitalism to himself, Citi's analysts have not lost their sense of humor. In a Jan 8 report, C analyst Glen Yeung boldly claimed that the shitty half of the telecom industry will likely be acquired by the less shitty half. Companies such as Texas Instruments, Marvel and Freescale (with its $9.3 billion of debt trading in the 40s much to the pride of its proud market-top-ticking PE daddies) would be aquired by smallish Broadcom and smallisher Infineon. While we would heartily enjoy the image of junior buyside analysts justifying to their overpaid seniors the validity of triple digit pro forma leverage, we are somewhat skeptical about this proposition. After all in November, Glen said he expects Intel, Qualcomm, Nvidia, Altera, ST Micro and Integrated Device Technology to return 43% over the next 12 months (presumably before this bombshell from Intel). Of course, in this volatile market it is also very likely the Glen is absolutely correct and we stand with baited breath to sell our 3 shares of Intel stock at $23 and put our 2 bonds of Freescale at par to whoever the lucky strategic winner of that particular auction will be.

As for more near-term shennanigans in the telecom space, keep a close eye out for Nortel. Although the Canadian company's stock price rose by 30% (aka $0.10) today, they have over $100 million in bond payments due on January 15th. While the bonds have run up by a ton in the past month, and the company does have enough cash to buy Platinum VIP service from Spitzer's favorite hooker for at least 4-6 weeks, it is a toss up as to whether or not it will be next week's biggest bankruptcy. Seeing how everybody's favorite thunderthigh reducer was forced to see the inside of 824 N Market Street #500 in Wilmington (see earlier post), we take the under .

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