Citing $12.9 billion in debts, Reliance Group Holdings Inc.
filed for protection from creditors under Chapter 11 of the federal bankruptcy code. The New York-based company is the parent of Reliance Financial Services Corp., whose insurance arm is responsible for much of the debt because of unpaid claims. The latter has stopped writing new policies and is under the supervision of the Pennsylvania Department of Insurance.
Financially troubled Lucent Technologies took a new hit with the downgrading of its credit rating to junk-bond status by Standard & Poor's. The move means Lucent will have to pay higher interest rates to borrow money for future needs. Since Jan. 1, the company has announced the layoffs of - or the offer of retirement buyouts to - more than 26,000 employees.
Lucent spinoff Avaya Inc., a leading maker of messaging systems and software for voice/data integration, said it will lay off 3,000 workers. Avaya, based in Basking Ridge, N.J., was Lucent's networking arm until last October.
Polaroid announced an "absolutely necessary" plan to cut another 2,000 jobs, or 25 percent of its work force as it seeks to reposition itself as a digital imaging company. About half the layoffs will come in the US, a spokesman said. In February, Polaroid cut 950 jobs.
Mail-Well Inc., the world's largest maker of envelopes and a major player in the commercial printing industry, announced plans to close nine US plants in a move to save $38 million a year. Mail-Well is based in Englewood, Colo.
Whittling down more of its massive debt, British Telecom announced the sale of its portfolio of properties for $3.2 billion. The sale to a joint venture of British investors did not include the company's London headquarters building, which is being offered separately. Earlier this year, BT sold its yellow pages business and its stakes in Japanese and Spanish mobile phone operators. It still owes a reported $39.2 billion.
(c) Copyright 2001. The Christian Science Monitor