Northwest Offers Temporary Deal On Pension Debt

Law360, New York (April 6, 2006, 12:00 AM EDT) -- Hoping to steer clear of a legal battle with the Pension Benefit Guaranty Corp., bankrupt Northwest Airlines Corp. has decided to temporarily pay interest and fees on $370.9 million in pension debt.

The airline requested approval of the deal from the U.S. Bankruptcy Court in Manhattan in order to keep the federal pension insurer at bay.

PBGC has claimed that the value of the collateral securing the pension debt is declining and has asserted that the agency has the right to protection for the debt....
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