Nortel's cost reduction pro-gram, when fully implemented, is expected to save some US$3.5 billion a year.
Nortel also announced Friday it had arranged to borrow US$2 billion from JP Morgan Chase and Credit Suisse First Boston, will stop making common-share dividend payments after June and will make an adjustment to intangible assets of some US$12.3 billion.
Nortel's second quarter results will be announced on July 19.
In New York, Moody's Investor's Service said it has placed on review for possible downgrade Nortel's A2 long-term debt rating, A3 rating on preferred stock and Prime-1 short-term rating.
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