/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/070612.mbx T R O U B L E D C O M P A N Y R E P O R T E R A S I A P A C I F I C Tuesday, June 12, 2007, Vol. 10, No. 115 Headlines A U S T R A L I A DALT GROUP: Members and Creditors to Meet on June 29 DAVTUB PTY: Joint Meeting Set for June 29 EETWELL PTY: Sets Joint Meeting on June 22 FREEBODY & ASSOCIATES: Members Decide to Shut Down Business GOLDEN BREED: Creditors' Proofs of Debt Must be In by June 19 HOBBYTEX INVESTMENTS: Members' Final Meeting Set for July 6 HTX INTERNATIONAL: Members' Final Meeting Set for July 6 JAM BRIX: Members & Creditors to Meet on June 22 KRONOS INC: Shareholders Okay Hellman & Friedman Merger Deal NORD RESOURCES: Completes Offering of Special Warrants NORD RESOURCES: Mar. 31 Balance Sheet Upside-Down by US$6.2 Mil. RAUWIN HOLDINGS: Members Pass Resolution to Wind Up Firm ROYAL CARRIBEAN: Launches US$0.15 Per Share Quarterly Dividend STEPHEN AND GAYE: Members' Final Meeting Set for June 18 VALROSA PTY: Placed Under Members' Voluntary Liquidation W G HILL: Creditors Must Prove Debts by July 5 WATERLOO JOINERY: Supreme Court Enters Wind-Up Order W.R. GRACE: Wants to Contribute US$71.8 Mil. to Retirement Plans W.R. GRACE: Inks Settlement Pact with Trumbull Memorial C H I N A & H O N G K O N G ALL AMERICAN: Completes Sale to Rock River for US$15.2 Million AMC ENTERTAINMENT: Fitch To Rate New US$400-Million Loan at CCC AMC ENTERTAINMENT: Moody's Rates Proposed Sr. Unsec. Debt at B3 ANDREW CORP: Seeks New Buyer After Failed Kimball-Hill Agreement ASHMORE ENERGY: GasAtacama Buy Worries Chilean Officials AVATAR MFG.: Creditors' Proofs of Debt Due by July 12 BANK OF COMMUNICATION: Takes 85% in Hubei Int'l for CNY1.2 Bil. BERRY PLASTICS: Moody's Lowers Corporate Family Rating to B2 CHEERTOP TRADING: Shareholders Opt to Shut Down Business CHINA MINSHENG: China Life Buys 4.9% Stake for CNY5.45 Billion FORD MOTOR: Recalls 7, 924 Mondeo Sedans in China HUA HIN: Final General Meeting Set for July 16 JONESWIN INVESTMENT: Members' Final Meeting Set for June 26 KAWAMURA CO: Moves Annual Creditors' Meeting to June 18 MANITOWOC COMPANY: Wants to Redeem 10-1/2% Senior Notes MOLESWORTH INVESTMENTS: Placed Under Voluntary Liquidation MULTI WAY: Taps LO Kwok Wai as Liquidator OIL SHIPPING: Sets Members' Final Meeting for July 9 SGIS SONGSHAN: Xinhua Lifts Credit Rating to BB SMITHFIELD FOODS: Fourth Quarter Net Income Up to US39.9 Mil. TCL MULTIMEDIA: Posts HK$2.5 Billion Net Loss for FY 2006 VARIETAL DISTRIBUTION: Moody's Puts Corporate Family Rtg. at B3 VWR INT’L: Pending Madison Dearborn Deal Cues S&P to Hold B Rtg. ZTE CORP: Russia's Sistema Inks Various Telecom Deals ZTE CORP: To Build China Mobile's CNY2.37BB Wireless Network I N D I A ALGOMA STEEL: High Debt Leverage Cues S&P’s B Credit Rating AMERICAN AXLE: S&P Rates Proposed US$250 Million Term Loan at BB GENERAL MOTORS: Says It Is Making Progress in Restructuring RPG LIFE SCIENCES: Board to Consider Scheme of Arrangement Today TATA MOTORS: May 2007 Sale Decreases 4% From Last Year's TATA POWER: Net Profit Down 33% in January-March 2007 Quarter UNION BANK OF INDIA: T. Y. Prabhu Named New Executive Director UTI BANK: To Raise US$1 Billion by Share Issuance UTI BANK: Shareholders Okay Dividend of INR4.5 Per Share I N D O N E S I A ALCATEL-LUCENT: Inks Two-Year Agreement with Comcel ALCATEL-LUCENT: Christian Sapsizian Pleads Guilty of Bribe ALCATEL-LUCENT: Inks Tech Support & Maintenance Pact with Vivo ALCATEL-LUCENT: Wins Contract From Vivo HILTON HOTELS: Selling Embassy Suites Hotel to 1022 Shady INDOFOOD: Cuts Capital Spending Up to 37 Percent MEDIA NUSANTRA: Raises US$419 Million in IPO PAKUWON JATI: Buys IDR88.72-Billion Land From Pakuwon Darma PERTAMINA: To Import Additional 200,000 Barrels of Kerosene PERUSAHAAN GAS: May Miss July Completion Target Due to Flooding J A P A N ALITALIA SPA: Air One and Aeroflot Explore Possible Tie-Up DELPHI CORP: Court Approves US$10.5 Million Umicore Settlement DELPHI CORP: Wants to Further Employ Ernst & Young as Auditors ITOCHU CORP: To Study Ethanol Producing Plant with Petroleo JVC CORP: Mulls Capital Tieup with Kenwood JVC CORP: Shares Plunge on Kenwood Share Acquisition News KRATON POLYMERS: Weak Profitability Cues S&P to Lower Ratings K O R E A BIOMET INC: Private Equity Consortium Ups Offer to US$11.4 Bil. BIOMET INC: Regains Nasdaq Listing Compliance BIOMET INC: Moody's May Downgrade All Ratings After Review BHK INC: Signs Statutory Merger With NewheartBio Co. DM TECHNOLOGY: Converts Second Convertible Bonds Into Shares EVEREX INC: Appoints Park Chan as New Chief Executive Officer TOWER AUTOMOTIVE: Inks Asset Purchase Pact with TA Acquisition TOWER AUTOMOTIVE: Lexington Wants Adequate Assurance on Lease M A L A Y S I A AMSTEEL CORP: Bursa Denies Further Plan Filing Extension DAY INTERNATIONAL: Completes Sale to Flint Group DAY INT’L: Flint Buyout Completion Cues S&P to Withdraw Ratings HALIFAX CAPITAL: Bursa Starts Delisting Procedures HARVEST COURT: Unit Sells Land Assets for MYR1.7 Million SMART MODULAR: Ezra Perlman Resigns as Director N E W Z E A L A N D CREATIVE EDUCATION: Court to Hear Wind-Up Petition on June 28 GYM TRADING: Enters Wind-Up Proceedings INDUSTRIAL BELTS: Fixes July 2 as Deadline to Prove Claims QUADRANT CORPORATION: Faces APN Holdings' Wind-Up Petition SIMPSONS FARMS: Appoints Michael Crawford as Liquidator SNOW SUMMIT: Names Peter James Heenan as Liquidator TENNET INTERNATIONAL: Taps Graham and Gibson as Liquidators THE PC RECYCLING: Court Hears Wind-Up Petition UNION INTERACTIVE: Fixes July 1 as Last day to Prove Claims P H I L I P P I N E S BANCO DE ORO-EPCI: Equitable PCI Now Removed From PSEi and Index BAYAN TELECOMMUNICATIONS: Posts PHP101-Mil. Loss in 1st Quarter BENPRES HOLDINGS: Earns PHP828 Million in First Quarter of 2007 CHIQUITA BRANDS: Colsiba Accuses Possible Covenant Breach CHIQUITA BRANDS: Faces Lawsuit by Murder Victims' Families CITY RESOURCES: Reports PHP2.86-Million Deficit as of Mar. 31 EVER-GOTESCO RESOURCES: Posts PHP49-Mil. Net Income for 1st Qtr. EXPORT & INDUSTRY BANK: Posts PHP80MM Net Loss in 1st Qtr. 2007 PHIL NAT'L BANK: Pursues PHP25 Mil. Estafa Case v. Ex-Employees SERVICEMASTER CO: S&P Rates US$3.35 Billion Sr. Facilities at B+ ZIPPORAH REALTY: Sells 80 Million Shares in Ebedev to Beziers ZIPPORAH REALTY: Annual Stockholders' Meeting Moved to July 16 S I N G A P O R E HEXION SPECIALTY: S&P Revises Recovery Ratings on 2nd-Lien Notes INFOTECH VENTURES: Receiving Proofs of Debt Until July 9 INTEGRAL PERIPHERALS: Proofs of Claim Bar Date is June 22 KODAK VERSAMARK: Requires Creditors to Prove Debts by July 8 MTU ASIA: Creditors' Proofs of Debt Due by July 9 SEA CONTAINERS: Court Approves Archlane Leases Settlement Pact T H A I L A N D DAIMLERCHRYSLER: Recalls 1,443 Faulty Chinese-Made Chrysler Cars DAIMLERCHRYSLER: Warrant Holder Wants to Exercise Right to Trust DAIMLERCHRYSLER AG: Aims to Boost Sales & Make Mercedes No. 1 FEDERAL-MOGUL: Modifies 4th Amended Plan to Address Objections TRUE CORP: Moody's Cuts Corporate Family Rating to B1 from Ba3 TRUE MOVE: Moody's Holds Corporate Family Rating at B1 * BOND PRICING: For the Week 11 June to 15 June 2007 - - - - - - - - ================= A U S T R A L I A ================= DALT GROUP: Members and Creditors to Meet on June 29 ---------------------------------------------------- A joint meeting will be held for the members and creditors of Dalt Group Pty Limited on June 29, 2007, at 10:00 a.m. The members and creditors will hear at the meeting a report about the company's wind-up proceedings and property disposal. Dalt Group's liquidator is: Paul G. Weston Deloitte Touche Tohmatsu Grosvenor Place, 225 George Street Sydney, New South Wales 2000 Australia DAVTUB PTY: Joint Meeting Set for June 29 ----------------------------------------- Davtub Pty Limited will hold a joint meeting for its members and creditors on June 29, 2007, at 10:00 a.m. At the meeting, the members and creditors will receive the liquidator's report about the company's wind-up proceedings and property disposal. The company's liquidator is: Paul G. Weston Deloitte Touche Tohmatsu Grosvenor Place, 225 George Street Sydney, New South Wales 2000 Australia EETWELL PTY: Sets Joint Meeting on June 22 ------------------------------------------ The members and creditors of Eetwell Pty Limited will have a joint meeting on June 22, 2007, at 9:00 a.m. At the meeting, the members and creditors will be asked to: -- receive the report about the company's wind-up proceedings and property disposal; -- fix the liquidator's remuneration; and -- authorize the liquidator to apply to the Australian Securities and Investment Commission and the Australian Taxation Office for permission to destroy the books and records of the company. The company's Liquidator is: Brian P. Dunphy Freshwater Management Pty Ltd PO Box 663, Harbord New South Wales 2096 Australia FREEBODY & ASSOCIATES: Members Decide to Shut Down Business ----------------------------------------------------------- During a general meeting held on May 18, 2007, the members of Freebody & Associates Pty Limited decided to shut down the company's business and appointed Frank Lo Pilato as liquidator. The Liquidator can be reached at: Frank Lo Pilato RSM Bird Cameron Partners Level 1, 103-105 Northbourne Avenue Turner ACT 2612 Australia Telephone:(02) 6247 5988 GOLDEN BREED: Creditors' Proofs of Debt Must be In by June 19 ------------------------------------------------------------- Golden Breed Australia Pty Ltd requires its priority and unsecured creditors to file their proofs of debt by June 19, 2007. The company will declare the first dividend on July 3, 2007. The company's deed administrator is: David James Lofthouse CJL Partners 180 Flinders Lane, Level 3 Melbourne, Victoria 3000 Australia Telephone:9639 4779 Facsimile:9639 4773 HOBBYTEX INVESTMENTS: Members' Final Meeting Set for July 6 ----------------------------------------------------------- Hobbytex Investments Pty. Limited will hold the final meeting for its members on July 6, 2007, at 11:00 a.m. The members will receive at the meeting a report about the company's wind-up proceedings and property disposal. The company's liquidator is: M. C. Shrimpton c/o Mawby Cowper Meares & Co 47 Neridah Street Chatswood, New South Wales 2057 Australia HTX INTERNATIONAL: Members' Final Meeting Set for July 6 -------------------------------------------------------- A final meeting will be held for the members of HTX International Pty Limited on July 6, 2007, at 10:00 a.m. M. C. Shrimpton, the company's liquidator, will give a report about the company's wind-up proceedings and property disposal at the meeting. The Liquidator can be reached at: M. C. Shrimpton c/o Mawby Cowper Meares & Co 47 Neridah Street Chatswood, New South Wales 2057 Australia JAM BRIX: Members & Creditors to Meet on June 22 ------------------------------------------------ The members and creditors of Jam Brix Pty Limited will meet on June 22, 2007, at 10:00 a.m., to receive the liquidator's report about the company's wind-up proceedings and property disposal. The company's Liquidator is: Brian P. Dunphy Freshwater Management Pty Ltd PO Box 663, Harbord New South Wales 2096 Australia KRONOS INC: Shareholders Okay Hellman & Friedman Merger Deal ------------------------------------------------------------ Kronos(R) Incorporated disclosed Friday that shareholders voted to approve the merger agreement providing for the acquisition of Kronos by entities affiliated with Hellman & Friedman Capital Partners VI, L.P., a private equity investment firm. Investing alongside Hellman & Friedman is JMI Equity, a private equity firm focused on the software and business services industries. The vote was conducted at a special meeting of Kronos shareholders held last June 8, 2007 at the offices of Wilmer Cutler Pickering Hale and Dorr LLP in Boston, Massachusetts. Based on the preliminary tally of shares voted, the number of shares that voted to approve the merger agreement represents approximately 79% of the total number of shares of Kronos common stock outstanding and entitled to vote as of the close of business on April 30, 2007, the record date for the special meeting. The proposed merger, disclosed on March 23, 2007, and is expected to close today, June 11, 2007, subject to the satisfaction or waiver of the conditions set forth in the merger agreement. Under terms of the merger agreement, shareholders will receive US$55.00 per share in cash for each share of Kronos common stock held or a total transaction value of approximately US$1.8 billion. Kronos Incorporated -- http://www.kronos.com-- (Nasdaq: KRON) pProvides software and services that enable organizations to reduce costs, increase productivity, improve employee satisfaction, and ultimately enhance the level of service they provide. Kronos serves customers in more than 50 countries through its network of offices, subsidiaries, and distributors. The company offers its products primarily in the United States, Canada, Mexico, the United Kingdom, Australia, and New Zealand. * * * As reported in the Troubled Company Reporter on May 21, 2007, Moody's Investors Service assigned Kronos, Inc. a first time B2 corporate family rating and a stable rating outlook. Moody's also assigned a first time Ba3 rating to the company's first lien credit facilities ($665 million term loan, due 2014, and US$60 million revolving credit facility, expires 2013); and a Caa1 rating to its US$390 million second lien term loan, due 2015. NORD RESOURCES: Completes Offering of Special Warrants ------------------------------------------------------ Mr. Ronald A. Hirsch, Chairman of the Board of Directors of Nord Resources Corporation disclosed that on June 6, 2007 that the company completed an offering of 30,666,700 special warrants of Nord at a price of US$0.75 per Special Warrant for aggregate gross proceeds of approximately US$23 million. The offering was effected on a private placement basis using a Canadian broker as lead agent on a best efforts basis, subject to a minimum subscription level of US$20 million. Each Special Warrant is convertible into one share of Nord’s common stock and one-half of one common stock purchase warrant for no additional consideration. Each Warrant, when issued, will entitle the holder to purchase one additional share of Nord’s common stock for a period of five years following the date of closing of the private placement at a price of US$1.10 per share. Under the terms of the offering, Nord is required to: (i) file and obtain a receipt for a Canadian non-offering prospectus to qualify the issuance of the Shares, the Warrants and the Warrant Shares in Canada, and (ii) file a registration statement under the United States Securities Act of 1933 in order to register the resale of the Shares and the Warrant Shares in the United States. The conversion of the Special Warrants into Shares and Warrants is anticipated to take place upon a final receipt being issued for a Canadian prospectus. If Nord fails to obtain a receipt for a final Canadian prospectus and effectiveness of the U.S. registration statement within 180 days following the closing date of the offering, Nord will be liable for a liquidity incentive payment to the investors equal to 1% per month (pro-rated), subject to a maximum liquidity incentive payment equal to an aggregate of 12% of the gross proceeds of the offering. The proceeds of the financing will be applied to the re-activation of the Company’s Johnson Camp Mine, payment of certain outstanding debt (including related party debt of approximately US$2,950,000), general corporate purposes and the satisfaction of the condition precedent to Nord’s previously announced proposed US$25 million credit facility with Nedbank Limited. The offering of the Special Warrants was completed in the United States pursuant to exemptions from the registration requirements of the 1933 Act and outside of the United States to non-U.S. investors in accordance with Regulation S of the 1933 Act. Neither the Special Warrants, the Shares, the Warrants nor the Warrant Shares have been registered under the 1933 Act and may not be offered or sold in the United States absent registration or an exemption from the registration requirements of the 1933 Act. About Nord Resources Headquartered in Dragoon, Arizona, Nord Resources Corporation (Pink Sheets:NRDS) -- http://www.nordresources.com/-- is a natural resource company focused on near-term copper production from its Johnson Camp Mine and the exploration for copper, gold and silver at its properties in Arizona and New Mexico. The company also owns approximately 4.4 million shares of Allied Gold Limited, an Australian company. In addition, the company maintains a small net profits interest in Sierra Rutile Limited, a Sierra Leone, West African company that controls the world's highest-grade natural rutile deposit. NORD RESOURCES: Mar. 31 Balance Sheet Upside-Down by US$6.2 Mil. ---------------------------------------------------------------- Nord Resources Corp. reported a net loss of US$55,483 for the first quarter ended March 31, 2007, compared with a net loss of US$2,055,786 for the same period ended March 31, 2006. The company did not have any sales during the three months ended March 31, 2007, and 2006, due to the fact that the Johnson Camp Mine was on a care and maintenance program during these periods. The decrease in net loss between these periods is primarily related to a reduction in operating costs and interest expenses, and the increase in miscellaneous income associated with the PDM Settlement Agreement. At March 31, 2007, the company’s balance sheet showed US$3,954,645 in total assets and US$10,160,284 in total liabilities, resulting in a US$6,205,639 total stockholders’ deficit. The company’s balance sheet at March 31, 2007, also showed strained liquidity with US$1,307,479 in total current assets available to pay US$9,902,769 in total current liabilities. Full-text copies of the company’s consolidated financial statements for the quarter ended March 31, 2007, are available for free at http://researcharchives.com/t/s?20bf Going Concern Doubt Mayer Hoffman McCann PC, in Denver, raised substantial doubt about Nord Resources Corporation's ability to continue as a going concern citing significant operating losses after auditing the company's financial statements for the years ended Dec. 31, 2006, and 2005. The company incurred a net loss of US$6.3 million and US$3.1 million during the years ended Dec. 31, 2006, and 2005, respectively. About Nord Resources Headquartered in Dragoon, Arizona, Nord Resources Corporation (Pink Sheets:NRDS) -- http://www.nordresources.com/-- is a natural resource company focused on near-term copper production from its Johnson Camp Mine and the exploration for copper, gold and silver at its properties in Arizona and New Mexico. The company also owns approximately 4.4 million shares of Allied Gold Limited, an Australian company. In addition, the company maintains a small net profits interest in Sierra Rutile Limited, a Sierra Leone, West African company that controls the world's highest-grade natural rutile deposit. RAUWIN HOLDINGS: Members Pass Resolution to Wind Up Firm -------------------------------------------------------- On May 25, 2007, the members of Rauwin Holdings Pty Limited had a meeting and passed a resolution winding up the company's operations. The company's liquidator is: Frank Lo Pilato RSM Bird Cameron Partners Level 1, 103-105 Northbourne Avenue Turner ACT 2612 Australia Telephone:(02) 6247 5988 ROYAL CARRIBEAN: Launches US$0.15 Per Share Quarterly Dividend -------------------------------------------------------------- Royal Caribbean Cruises Ltd.'s Board of Directors declared a quarterly dividend of US$0.15 per share payable on June 29, 2007, to shareholders of record at the close of business on June 19, 2007. This is the 55th consecutive quarter Royal Caribbean's Board of Directors has voted to declare a dividend to shareholders. Headquartered in Miami, Royal Caribbean Cruises Ltd. (NYSE: RCL) -- http://www.royalcaribbean.com/ -- is a global cruise vacation company that operates Royal Caribbean International, Celebrity Cruises and Pullmantur. The company has a combined total of 34 ships in service and seven under construction. It also offers unique land-tour vacations in Alaska, Australia, Canada, Europe and Latin America. The company has operations in Puerto Rico. * * * As reported in the Troubled Company Reporter on Jan. 15, 2007, Moody's Investors Service assigned Royal Caribbean Ltd.'s new benchmark size Euro senior unsecured notes Ba1, raised RCL's Speculative Grade Liquidity rating to SGL-2 from SGL-3 and affirmed all other existing ratings. STEPHEN AND GAYE: Members' Final Meeting Set for June 18 -------------------------------------------------------- The members of Stephen and Gaye Johnson Engineering Pty Ltd will have their final meeting on June 18, 2007, at 10:00 a.m., to hear the liquidator's report about the company's wind-up proceedings and property disposal. The company's liquidator is: Stephen Ray Johnson 4 Fairy Dell Court Heathcote, Victoria 3523 New Zealand Telephone:(03)5433 2493 VALROSA PTY: Placed Under Members' Voluntary Liquidation -------------------------------------------------------- The members of Valrosa Pty Limited met on May 17, 2007, and resolved to voluntarily liquidate the company's operations. Alfred McCarthy was appointed as liquidator. The Liquidator can be reached at: Alfred McCarthy Gregory & McCarthy Chartered Accountants 75 Lead Street Yass, New South Wales 2582 Australia W G HILL: Creditors Must Prove Debts by July 5 ---------------------------------------------- The creditors of W G Hill Pty Limited are required to file their proofs of debt by July 5, 2007. Failure to prove debts by the due date will exclude a creditor from sharing in the company's dividend distribution. The company's liquidator is: Dennis George Furey PKF Level 3, Suite 301, 304-318 Kingsway Caringbah, New South Wales 2229 Australia WATERLOO JOINERY: Supreme Court Enters Wind-Up Order ---------------------------------------------------- On May 18, 2007, the Supreme Court of New South Wales released an order that winds up the company's operations and appointing D. I. Mansfield as liquidator. The Liquidator can be reached at: D. I.Mansfield Moore Stephens Chartered Accountants Level 6, 460 Church Street Parramatta, New South Wales 2150 Australia W.R. GRACE: Wants to Contribute US$71.8 Mil. to Retirement Plans ---------------------------------------------------------------- W.R. Grace & Co. and its debtor-affiliates asks the United States Bankruptcy Court for the District of Delaware for permission to make contributions to defined benefit retirement plans covering their employees in the United States required under federal law for the period from July 15, 2007, to April 15, 2008. The total of the legally required minimum contributions for the 2007-2008 Funding Period is approximately US$72,000,000, James E. O'Neill, Esq., at Pachulski Stang Ziehl Young Jones & Weintraub, LLP, in Wilmington, Delaware, tells the Court. The funded status of the Grace Retirement Plans has improved; however, the Plans are still underfunded by most accepted measures, according to Mr. O'Neill. The funding approach for the 2007-2008 Funding Period is to make only those contributions to the Grace Retirement Plans that are necessary to satisfy the minimums that are legally required by applicable law. Each contribution will be made no sooner than one month before the deadline imposed by federal law. For the 2007-2008 Contribution, the Debtors will follow this schedule: Payment Due Date Contributions Plan Year ---------------- ------------- --------- July 15, 2007 US$8,982,359 2007 September 15, 2007 15,343,157 2006 October 15, 2007 14,830,385 2007 January 15, 2007 14,830,385 2007 April 15, 2007 17,873,596 2008 ------------- Total Contribution US$71,859,882 ============= No changes are anticipated in applicable federal law that could affect the amount of the minimum contributions required to be made to the Grace Retirement Plans during the 2007-2008 Funding Period, except with respect to the first quarterly contribution for the 2008 plan year due April 15, 2008, to the extent that any regulations issued under the Pension Protection Act affect the calculation of contributions for that plan year, Mr. O'Neill maintains. The Debtors believe that continuing to make at least the legally required minimum contributions to each of the Grace Retirement Plans is essential in maintaining the morale of their workforce and confidence in their management. The employees are vital to maintaining and enhancing the value of the Debtors' estate and to the Debtors' successful reorganization, Mr. O'Neill avers. About W.R. Grace Headquartered in Columbia, Md., W.R. Grace & Co. (NYSE:GRA) -- http://www.grace.com/-- supplies catalysts and silica products, especially construction chemicals and building materials, and container products globally, including Argentina, Australia and Ireland. The Company and its debtor-affiliates filed for chapter 11 protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139). James H.M. Sprayregen, Esq., at Kirkland & Ellis, and Laura Davis Jones, Esq., at Pachulski, Stang, Ziehl, Young, Jones & Weintraub, P.C., represent the Debtors in their restructuring efforts. The Debtors hired Blackstone Group, L.P., for financial advice. PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock & Stroock & Lavan LLP represent the Official Committee of Unsecured Creditors. The Creditors Committee tapped Capstone Corporate Recovery LLC for financial advice. David T. Austern, the legal representative of future asbestos personal injury claimants, is represented by Orrick Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA. Anderson Kill & Olick, P.C., represent the Official Committee of Asbestos Personal Injury Claimants. The Asbestos Committee of Property Damage Claimants tapped Martin W. Dies, III, Esq., at Dies & Hile L.L.P., and C. Alan Runyan, Esq., at Speights & Runyan,to represent it. Lexecon, LLP, provided asbestos claims consulting services to the Official Committee of Equity Security Holders. The Debtors' filed their Chapter 11 Plan and Disclosure Statement on Nov. 13, 2004. On Jan. 13, 2005, they filed an Amended Plan and Disclosure Statement. The hearing to consider the adequacy of the Debtors' Disclosure Statement began on Jan. 21, 2005. The Debtors' exclusive period to file a chapter 11 plan expires on July 23, 2007. The PI Estimation Trials will begin on Sept. 17, 2007. At Dec. 31, 2006, the W.R. Grace's balance sheet showed total assets of US$3,620,400,000 and total debts of US$4,189,100,000. (W.R. Grace Bankruptcy News, Issue No. 131; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). W.R. GRACE: Inks Settlement Pact with Trumbull Memorial ------------------------------------------------------- W.R. Grace & Co. and its debtor-affiliates entered into a settlement agreement with Trumbull Memorial Hospital, which provides a certain amount that will be deemed as the final liquidation of Claim No. 7028. The Settlement Amount however was not disclosed in the parties' filing with the United States Bankruptcy Court for the District of Delaware. In September 2005, the Debtors objected to thousands of asbestos-related property damage claims, including Claim No. 7028 filed by Trumbull Memorial, on various grounds. Trumbull Memorial responded to the Debtors' objection and thereafter, the parties engaged in extensive negotiations to resolve the Trumbull Claim. For voting purposes with respect to a plan of reorganization, Trumbull Memorial will be entitled to one vote and the amount of the Trumbull Claim for voting purposes will be equal to the Settlement Amount. In the event that (i) a reorganization plan ultimately confirmed by the Court does not provide Trumbull Memorial distribution on its claim equal to 100% of the Settlement Amount, or (ii) the Debtors' bankruptcy case is converted to a case under Chapter 7 of the Bankruptcy Code, Trumbull Memorial may void the Settlement Agreement and re-assert its Claim as presently filed. The Debtors also seek the Court's permission to maintain the confidentiality of the Settlement Amount. Timothy P. Cairns, Esq., at Pachulski Stang Ziehl Young Jones & Weintraub, P.C., in Wilmington, Delaware, asserts that given the current state of the PD Claims and the ongoing general public, disclosing the Settlement Amount would not be in the Debtors' best interest. Mr. Cairns relates that the Debtors will disclose the Settlement Amount to the Court in camera if requested. The Debtors will also disclose the Settlement Amount to the Official Committees appointed in the Debtors' cases and the Future Claims Representative. About W.R. Grace Headquartered in Columbia, Md., W.R. Grace & Co. (NYSE:GRA) -- http://www.grace.com/-- supplies catalysts and silica products, especially construction chemicals and building materials, and container products globally, including Argentina, Australia and Ireland. The Company and its debtor-affiliates filed for chapter 11 protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139). James H.M. Sprayregen, Esq., at Kirkland & Ellis, and Laura Davis Jones, Esq., at Pachulski, Stang, Ziehl, Young, Jones & Weintraub, P.C., represent the Debtors in their restructuring efforts. The Debtors hired Blackstone Group, L.P., for financial advice. PricewaterhouseCoopers LLP is the Debtors' accountant. Stroock & Stroock & Lavan LLP represent the Official Committee of Unsecured Creditors. The Creditors Committee tapped Capstone Corporate Recovery LLC for financial advice. David T. Austern, the legal representative of future asbestos personal injury claimants, is represented by Orrick Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA. Anderson Kill & Olick, P.C., represent the Official Committee of Asbestos Personal Injury Claimants. The Asbestos Committee of Property Damage Claimants tapped Martin W. Dies, III, Esq., at Dies & Hile L.L.P., and C. Alan Runyan, Esq., at Speights & Runyan,to represent it. Lexecon, LLP, provided asbestos claims consulting services to the Official Committee of Equity Security Holders. The Debtors' filed their Chapter 11 Plan and Disclosure Statement on Nov. 13, 2004. On Jan. 13, 2005, they filed an Amended Plan and Disclosure Statement. The hearing to consider the adequacy of the Debtors' Disclosure Statement began on Jan. 21, 2005. The Debtors' exclusive period to file a chapter 11 plan expires on July 23, 2007. The PI Estimation Trials will begin on Sept. 17, 2007. At Dec. 31, 2006, the W.R. Grace's balance sheet showed total assets of US$3,620,400,000 and total debts of US$4,189,100,000. (W.R. Grace Bankruptcy News, Issue No. 131; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). ================================ C H I N A & H O N G K O N G ================================ ALL AMERICAN: Completes Sale to Rock River for US$15.2 Million ------------------------------------------------------------ All American Semiconductor, Inc., on Friday, completed the sale of substantially all of its assets to Rock River Capital LLC and the Company's senior secured lenders for which Harris N.A. acts as agent. The aggregate purchase price was US$15.2 million, which will be paid to the senior secured lenders in the form of a reduction in their secured claim. As previously stated, Rock River Capital was the successful bidder for substantially all of the company's operating assets and is expected to continue to operate the acquired assets as a going concern business utilizing All American's 42 years of experience and service to the industry. The company's senior secured lenders were the successful bidders for the company's accounts receivable. None of the company's commercial tort claims or avoidance actions was sold. About All American Semiconductor Based in Miami, Florida, All American Semiconductor Inc. (Pink Sheets: SEMI.PK) -- http://www.allamerican.com/-- is a distributor of electronic components manufactured by others. The company distributes a full range of semiconductors including transistors, diodes, memory devices, microprocessors, microcontrollers, other integrated circuits, active matrix displays and various board-level products. All American also distributes passive components such as capacitors, resistors and inductors; and electromechanical products such as power supplies, cable, switches, connectors, filters and sockets. The company also offers complete solutions for flat panel display products. In total, the company offers approximately 40,000 products produced by approximately 60 manufacturers. The company has 36 strategic locations throughout North America and Mexico, as well as operations in China and Western Europe. The company and its debtor-affiliates filed for Chapter 11 protection on April 25, 2007 (Bankr. S.D. Fla. Lead Case No. 07-12963). Tina M. Talarchyk, Esq., at Squire Sanders & Dempsey LLP, in West Palm Beach, Florida, represents the Debtors. Jerry M. Markowitz, Esq., at Markowitz, Davis, Ringel & Trusty, P.A., and William M. Hawkins, Esq., at Loeb & Loeb LLP, represents the Committee. As of Feb. 28, 2007, total assets was US$117,634,000 and total debts was US$106,024,000. AMC ENTERTAINMENT: Fitch To Rate New US$400-Million Loan at CCC --------------------------------------------------------------- Fitch has affirmed the Issuer Default Ratings of Marquee Holdings Inc and its principal operating subsidiary AMC Entertainment, Inc., at 'B' following the company's recent announcement. Fitch expects to rate the new US$400 million senior unsecured term facility 'CCC/RR6' and would also expect to rate the potential $275 million senior unsecured term loan facility 'CCC/RR6' based on their deep structural subordination in the capital structure. The Rating Outlook is Stable. Marquee Holdings has announced an intention to enter into a five-year US$400 million senior unsecured term loan facility at an additional holding company level, named AMC Entertainment Holdings, Inc., to fund a dividend payout to Marquee's current shareholders. Neither Marquee or its operating subsidiary AMC Entertainment or its subsidiaries will be a party to the transaction. Simultaneously, Marquee announced a consent solicitation to amend the indenture of its existing discount notes due 2014 to accommodate a dividend payment of up to US$275 million prior to the next accretion date on Aug. 15, 2007. If the amendment is approved, Marquee intends to use cash on hand at AMC Entertainment but also has an option to fund the dividend by entering into an additional US$275 million senior unsecured term loan facility. The note holders are offered a 1.44% consent fee at maturity. Regardless of the results of the solicitation, entering into the proposed US$400 million facility would trigger a cash interest payout on the discount notes estimated at approximately US$29 million per year beginning on Feb. 15, 2008. This announcement follows the suspension of Marquee's IPO on May 3, 2007. Fitch believes that AMC/Marquee has sufficient financial flexibility at its current rating to fund the additional debt service payments due to the recent debt reduction, solid operating performance and expectations for a continued strong box office performance for the remainder of the summer season. In March 2007, the company allocated all proceeds from the National CineMedia IPO and US$109 million in cash toward debt repayment and fully redeemed approximately US$600 million of its higher coupon operating company senior and subordinated notes. Therefore, while the proposed transaction will result in higher consolidated debt levels, potentially reaching the level prior to the debt reduction, Fitch notes that the new debt does not affect the default probability and recovery expectations of the operating company debt ranked higher in the capital structure. Liquidity profile may be weakened if the company chooses to fund the US$275 million additional dividend with cash on hand at AMC, pending the results of the consent solicitation. The company reported a proforma cash balance of US$362 million and US$177 of availability under its revolving facility as of Dec. 28, 2006. Following the suspension of the AMC IPO in early May 2007, Fitch's ratings incorporated the potential for another equity offering and a dividend, albeit a lower one, to the shareholders. Therefore, Fitch believes that the announced plan to return capital to the current shareholders is within the existing and expected financial policies reflected by the 'B' rating. Fitch affirms these ratings: AMC -- Issuer Default Rating 'B'; -- Senior secured credit facilities 'BB/RR1'; -- Senior unsecured notes 'B/RR4'; -- Senior subordinated notes 'CCC+/RR6'. Marquee -- Issuer Default Rating 'B'; -- Senior discount notes 'CCC/RR6'. The Rating Outlook is Stable. About Marquee Holdings Based in Kansas City, Mo., Marquee Holdings Inc. is organized as an intermediate holding company with no operations of its own. The Company's principal directly owned subsidiaries are American Multi-Cinema, Inc., Grupo Cinemex, S.A. de C.V., and AMC Entertainment International, Inc. About AMC Entertainment Based in Kansas City, Missouri, AMC Entertainment Inc. -- http://www.amctheatres.com/-- is a worldwide leader in the theatrical exhibition industry. The company serves more than 250 million guests annually through interests in 415 theatres and 5,672 screens in 12 countries including the United States, Hong Kong, Brazil and the United Kingdom. AMC ENTERTAINMENT: Moody's Rates Proposed Sr. Unsec. Debt at B3 --------------------------------------------------------------- Moody's Investors Service changed the outlook for Marquee Holdings Inc. (parent of AMC Entertainment Inc.) to negative from stable. Moody's also assigned a B3 rating to its proposed debt at AMC Entertainment Holdings, Inc., a newly created entity that will become the parent of Marquee. The company intends to use proceeds to fund a dividend to Marquee's current stockholders. The negative outlook reflects concerns over the increase in leverage to 7.2 times debt-to-EBITDA from 6.7 times (based on estimated results for the year ended March 31, 2007, and as per Moody's standard adjustments, which include operating leases). Furthermore, the transaction creates no value for creditors and represents a reversal from the commitment to improving Marquee's credit profile that management demonstrated by repaying debt with proceeds from the National CineMedia transactions. If Marquee's debt-to-EBITDA remains in excess of 7 times over the next year, or if the company does not generate positive free cash flow, Moody's would likely downgrade the corporate family rating to B2. Conversely, Moody's would consider stabilizing the outlook with: (1) leverage below 7 times and on track to fall to the low to mid 6 times; and (2) positive free cash flow. The B3 rating on the proposed debt incorporates its junior-most position in the capital structure, and the LGD6 93% reflects its low recovery prospects as a result of the material amount of claims ranking senior to it that would have to be repaid first in a default scenario. This new debt does not benefit from any subsidiary guarantees, nor does it have a security interest in any assets of the company. It is structurally subordinated to all other debt in the capital structure, which, inclusive of capitalized operating leases, comprises approximately $5.5 billion. The introduction of this junior-ranking claim of size to the company's consolidated capitalization, however, results in an upgrade of the rating for the higher-ranking (via structural seniority) senior subordinated notes to B2, from B3, as the LGD estimate is reduced. All other ratings were affirmed. A summary of rating actions follows, including updated LGD assessments and point estimates to reflect the new capital structure. * Marquee Holdings Inc. -- Outlook changed to negative from stable; -- Affirmed B1 corporate family rating; -- Affirmed B1 probability of default rating. * AMC Entertainment Holdings, Inc. (newly created entity) -- Assigned B3, LGD6, 93% to proposed Senior Unsecured Bank Credit Facility. * AMC Entertainment, Inc. -- Senior Subordinated Bonds, Upgraded to B2 from B3, LGD5, 73%; -- Affirmed Ba1 on Senior Secured Bank Credit Facility, LGD2, 12%; -- Affirmed Ba3 on Senior Unsecured Bonds, LGD3, 34%. * Marquee Holdings, Inc. -- Affirmed B3 on Senior Unsecured Bonds, LGD5, 87%. The B1 corporate family rating for Marquee continues to reflect high leverage, sensitivity to product from movie studios, and a weak industry growth profile, offset by good liquidity and the advantages of scale and geographic diversity. About Marquee Holdings Based in Kansas City, Mo., Marquee Holdings Inc. is organized as an intermediate holding company with no operations of its own. The Company's principal directly owned subsidiaries are American Multi-Cinema, Inc., Grupo Cinemex, S.A. de C.V., and AMC Entertainment International, Inc. Its annual revenue is approximately $2.5 billion. About AMC Entertainment Headquartered in Kansas City, Mo., AMC Entertainment Inc. -- http://www.amctheatres.com/-- is a theatrical exhibition company with interests in about 382 theatres with 5,340 screens as of Dec. 28, 2006. About 87 percent of the company's theatres are located in the U.S. and Canada, and 13 percent in Mexico, Argentina, Brazil, Chile, Uruguay, Hong Kong, France, and the U.K. ANDREW CORP: Seeks New Buyer After Failed Kimball-Hill Agreement ---------------------------------------------------------------- Andrew Corporation seeks a new residential, commercial or industrial buyer for the remaining portion of its former Orland Park, Illinois, manufacturing and headquarters location after Kimball-Hill Homes failed to close on the purchase of the 73-acre property. As previously disclosed, Andrew and Kimball-Hill signed a contract in August 2005 for the purchase of Andrew’s 103-acre Orland Park property in two phases, the first of which involved 30 acres and closed in 2006 for net proceeds of approximately US$9 million. The second phase, involving 73 acres that include the former cable manufacturing and corporate headquarters buildings, was contracted to sell for US$16.5 million and did not close as required by May 31, 2007. As a result, Kimball-Hill has forfeited to Andrew US$2.5 million in earnest money and refunded approximately US$1.1 million of unused funds from a US$1.7 million escrow account established by Andrew for any required environmental remediation. "The buyer’s decision to not proceed with closing on the second phase of our agreement delays the process, but doesn’t change our focus on selling our remaining 73 acres of highly desirable property in Orland Park," said Marty Kittrell, chief financial officer, Andrew Corporation. "We have restarted the sales process with The Staubach Company and are beginning discussions with interested residential, commercial and industrial parties immediately." The company previously reported in its May 3, 2007 earnings release that it expected a US$0.06 per share gain in the fiscal third quarter from the second phase of the sale of the Orland Park property. As a result of Kimball-Hill’s failure to close, the company now expects to record a gain of US$0.02 per share in its fiscal third quarter related to the earnest money, instead of the previously expected US$0.06 per share gain. The foregoing change in estimate has no impact on the company’s previous non-GAAP fiscal 2007 earnings guidance. The company intends to update annual guidance when it reports fiscal third quarter results. The Orland Park property status has no effect on Andrew’s office and manufacturing relocations to Westchester and Joliet. The company’s corporate headquarters relocated to west suburban Westchester in early 2006, while the move to a newly constructed North American cable manufacturing and office facility in Joliet was completed this spring. About Andrew Corporation Headquartered in Westchester, Illinois, Andrew Corporation (NASDAQ: ANDW) -- http://www.andrew.com/-- designs, manufactures and delivers equipment and solutions for the global communications infrastructure market. The company serves operators and original equipment manufacturers from facilities in 35 countries, that includes, among others, China, India, Italy, Czech Republic, Argentina, Bahamas, Belize, Barbados, Bermuda and Brazil. * * * Standard & Poor's Ratings Services, in March 2007, affirmed its 'BB' corporate credit and other ratings on Andrew Corp. ASHMORE ENERGY: GasAtacama Buy Worries Chilean Officials -------------------------------------------------------- Ashmore Energy International's acquisition of generator and gas transporter GasAtacama has worried some mining and government authorities in Chile, Business News Americas reports. BNamericas relates that Ashmore Energy signed a deal to purchase 50% of GasAtacama from CMS Energy. GasAtacama lost US$500,000 a day in recent weeks during Argentina's natural gas cuts to Chile. According to local paper Diario Financiero, the officials are worried that Ashmore Energy could be more keen on selling off GasAtacama's assets than saving the company. BNamericas notes that this concern could prompt GasAtacama shareholder Endesa to stop Ashmore Energy's acquisition. Meanwhile, other authorities are worried that Ashmore Energy could be a "vulture fund looking to profit from GasAtacama's demise," BNamericas says. BNamericas underscores that the concerns led Endesa, which owns 50% of GasAtacama, to consider exercising its right to acquire the other half of the company. The Endesa board will discuss the matter during a meeting on June 28, Diario Financiero relates. The Chilean government and mining firms have tried to save GasAtacama, with Chilean state-run Codelco and multinational BHP Billiton agreeing to bail out the firm to guarantee energy supply in the north, BNamericas states. Ashmore Energy International Ltd. -- http://www.ashmoreenergy.com-- owns and operates a portfolio of energy infrastructure assets in power generation, transmission, and distribution of natural gas, gas liquids, and electric power. Ashmore Energy's portfolio, directly or indirectly, consists of 19 companies in 14 countries, most of which are located in Latin America. The company's largest asset is Brazilian electric distribution company, Elektro, which represents approximately 43% of EBITDA, and 55.3% of fiscal 2006 consolidated cash flow to parent company Ashmore Energy. The company also operates a power plant in the Dominican Republic. The company currently owns and operates a 116 MW thermal power plant in the Philippines, and has recently opened an office in Hong Kong under the name AEI Asia. * * * As reported in the Troubled Company Reporter-Latin America on April 3, 2007, Standard & Poor's Ratings Services assigned its 'B+' secured debt rating and '3' recovery rating to Ashmore Energy International's US$105 million synthetic revolving credit facility due in 2012. At the same time, Standard & Poor's affirmed its 'B+' corporate credit rating on Ashmore Energy; its 'B+' senior secured debt rating and '3' recovery rating on its US$395 million revolving credit facility due 2012, which was reduced from US$500 million; and its 'B+' senior secured debt rating and '3' recovery rating on Ashmore Energy's US$1 billion term loan due in 2014. AEI Finance Holding LLC is a co-borrower to Ashmore Energy's bank facility. S&P said the outlook is stable. As reported in the Troubled Company Reporter-Latin America on Feb. 27, 2007, Fitch Ratings assigned a BB Issuer Default rating to Ashmore Energy International Ltd. and rated its US$500 million senior revolver credit facility at BB. Also, Moody's Investors Service assigned a Ba3 rating to the senior secured credit facilities. AVATAR MFG.: Creditors' Proofs of Debt Due by July 12 ----------------------------------------------------- Avatar Mfg. Co. Limited commenced liquidation proceedings on June 1, 2007. Creditors' proofs of debt must be in by July 12, 2007, to be included in the company's dividend distribution. The company's liquidators are: Lai Kar Yan Darach E. Haughey One Pacific Place, 35th Floor 88 Queensway Hong Kong BANK OF COMMUNICATION: Takes 85% in Hubei Int'l for CNY1.2 Bil. --------------------------------------------------------------- China's Bank of Communications bought 85% of Hubei International Trust & Investment Co, paying CNY1.22 billion for the stake, Shanghai Daily reports. The report adds that after the acquisition, Hubei International will be renamed Bank of Communications International Trust & Investment Co. Bank of Communications Co Ltd -- http://www.bankcomm.com/-- is a commercial bank in the People's Republic of China. As of December 31, 2005, the bank had 137 branches and sub-branches, in addition, to over 2,600 business outlets in China. It also has its branches in Hong Kong, New York, Tokyo, Singapore and Seoul. The bank's business is divided into four segments: corporate banking, retail banking, treasury and others. Its corporate banking business provides products and services to the corporate customers, such as loans, deposits, bill discounting, trade finance, fund custody and guarantees. The retail banking business provides retail banking products and services to its retail customers, such as deposits, mortgage loans, debit cards, credit cards, wealth management and foreign exchange trading services. The treasury operations include inter-bank money market transactions, foreign exchange trading and government, and finance bond trading and investment. The bank carries Fitch Rating's 'D' individual rating effective on November 21, 2005. On May 4, 2007, as part of the application of its refined joint default analysis and updated bank financial strength rating methodologies, Moody's Investors Service affirmed Bank of Communications' D Bank Financial Strength Rating. The long-term Foreign Currency Deposit Rating is raised to Baa1 from Baa2. The short-term Foreign Currency Deposit Rating is raised to P-2 from P-3. The outlook for all ratings is stable. BERRY PLASTICS: Moody's Lowers Corporate Family Rating to B2 ------------------------------------------------------------ Moody's Investors Service downgraded the Corporate Family Rating of Berry Plastics Holding Corporation to B3 from B2. The outlook is stable. This rating action concludes the review for possible downgrade initiated on May 30, 2007 following the announcement that Berry Plastics Group, Inc. (Parent Company of Berry) was issuing a US$500 million term loan. The proceeds will be used to fund a one time dividend. Additional instrument rating actions are: Moody's took these rating actions: -- Downgraded Corporate Family Rating to B3 from B2; -- Downgraded Probability of Default Rating to B3 from B2; -- Confirmed US$1,200 million senior secured term loan due 2015 Ba3 (LGD 2, 27%); -- Confirmed US$225 million senior secured second lien FRN's due 2014 B3 (LGD 4, 65%); -- Confirmed US$525 million senior secured second lien notes due 2014 B3 (LGD 4, 65%); -- Downgraded US$265 million senior subordinated notes due 2016 to Caa2 (LGD 5, 82%) from Caa1 (LGD 6, 90%). These ratings of Berry Plastics Group, Inc. assigned prospectively on May 30, 2007 are now effective: -- US$500 million senior unsecured term loan due 2014, Caa2 (LGD 6, 93%). Moody's also affirmed the Speculative Grade Liquidity Rating of SGL-2 of Berry. The rating outlook for Berry is stable. The ratings and outlook are subject to receipt of final documentation. The downgrade of the Corporate Family Rating to B3 reflects: (1) the erosion in credit metrics to a level more indicative of a B3 rating; (2) Moody's belief that the credit metrics will not return to a level more consistent with the B2 rating category until 2010; and (3) the decline in enterprise value and collateral coverage stemming from the additional interest payments. Berry's rating upon the consummation of the merger with Covalence reflected an expected reduction in debt in the intermediate term to a level more consistent with the B2 rating category. The issuance of additional debt weakens leverage and coverage to a level that is indicative of a B3 rating. Moreover, the forecasted free cash flow over the intermediate term is insufficient to improve these metrics to a level more consistent with the B2 rating category. The expected additional interest payment for the new term loan represents a substantial proportion of the projected cash from operations and a significant drag on free cash flow. The integration of Covalence is not yet complete and risks still remain because of the difference in product lines and size as well as the historical operating issues. Additionally, the merger synergies represent a substantial portion of the forecasted financial results and are not yet assured given the continuing integration risk. As stated in our credit opinion dated April 11, 2007, a failure to reduce leverage below 6.5 times in the intermediate term could result in a downgrade. Berry has substantially increased debt twice in the last nine months and the ratings assigned both times were based upon the company's promise to reduce debt over the intermediate term. The current ratings and outlook are predicated upon significant debt reduction over the intermediate term. There is little room in the rating class for negative variance in operating results or any deterioration in credit metrics. The Caa2 rating on the US$500 million senior unsecured term loan is two notches below the Corporate Family Rating. The issuer is the Berry Plastics Group, Inc. which is the parent holding company of Berry Plastics Holdings Corporation and the issue is not guaranteed by any subsidiaries. The rating reflects the deep structural subordination to a significant amount of both secured and guaranteed debt at the operating holding company, Berry Plastics Holdings Corporation. The rating also reflects a loss given default of 93% and an expected loss of 25% and the absence of coverage on an enterprise value or distressed basis. Interest is payable in cash, PIK or a combination of 50% of each. Covenants include limitations on the incurrence of debt liens, asset sales, mergers, restricted payments, and future loan guarantees. Based in Evansville, Indiana, Berry Plastics Corporation -- http://www.berryplastics.com/-- manufactures and markets rigid plastic packaging products. Berry Plastics provides a wide range of rigid open top and rigid closed top packaging as well as comprehensive packaging solutions to over 12,000 customers, ranging from large multinational corporations to small local businesses. The company has 25 manufacturing facilities worldwide, including in Italy, England and Hong Kong and more than 6,800 employees. Pro forma for the recent merger with Covalence Specialty Materials Corporation, net sales for the 12 months ended March 31, 2007 amounted to approximately $3.0 billion. CHEERTOP TRADING: Shareholders Opt to Shut Down Business -------------------------------------------------------- The shareholders of Cheertop Trading Limited met on May 29, 2007, and resolved to shut down the company's business. Luk Wing Hay was appointed as liquidator. The Liquidator can be reached at: Luk Wing Hay Surson Commercial Building, 9th Floor 140-142 Austin Road Tsimshatsui, Kowloon Hong Kong CHINA MINSHENG: China Life Buys 4.9% Stake for CNY5.45 Billion -------------------------------------------------------------- China Life Insurance Co. Ltd. has agreed to buy 4.93% of China Minsheng Banking Corp. Ltd. for CNY5.45 billion or US$712 million, in cash, Reuters reports. Shanghai Bank arranged the details of the share sale. Citing the statement from China Life, Reuters relates that the insurance firm would buy 714 million shares at about CNY7.63 each after adjustment on an ex-rights basis. The shares are subject to a lock-up period of 26 months. China Minsheng Banking Corporation Ltd's principal activity is the provision of commercial banking services that include absorbing public deposits, providing short term, medium term, and long term loans, making domestic and international settlement, discounting bills and issuing financial bonds. On September 4, 2006, the Troubled Company Reporter - Asia Pacific reported that Fitch Ratings affirmed on September 5, 2006, China Minsheng Banking Corp.'s Individual D/E and Support 4 ratings. FORD MOTOR: Recalls 7, 924 Mondeo Sedans in China ------------------------------------------------- Ford Motor Co recalled 7,924 Mondeo sedans in China to fix faulty dynamos that may cause the cars' engines to stall, Shanghai Daily says, citing a report from Bloomberg News. The recall, according to the General Administration of Quality Supervision, covers 2.0-liter Mondeo manual sedans made locally between January 7, 2005, and December 15, 2006. About Ford Motor Co. Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) -- http://www.ford.com/-- manufactures and distributes automobiles in 200 markets across six continents. With more than 280,000 employees worldwide, the company's core and affiliated automotive brands include Aston Martin, Ford, Jaguar, Land Rover, Lincoln, Mazda, Mercury, and Volvo. Its automotive- related services include Ford Motor Credit Company and The Hertz Corp. Ford Motors has operations through a joint venture in China. * * * As reported in the Troubled Company Reporter on Dec. 12, 2006, Standard & Poor's Ratings Services affirmed its 'B' bank loan and '2' recovery ratings on Ford Motor Co. As reported in the Troubled Company Reporter on Dec. 7, 2006, Fitch Ratings downgraded Ford Motor Company's senior unsecured ratings to 'B-/RR5' from 'B/RR4'. As reported in the Troubled Company Reporter on Dec. 6, 2006, Moody's Investors Service assigned a Caa1, LGD4, 62% rating to Ford Motor Company's US$3 billion of senior convertible notes due 2036. HUA HIN: Final General Meeting Set for July 16 ---------------------------------------------- Hua Hin (S) Company Limited will hold the final general meeting on July 16, 2007, at 3:00 p.m., on the 7th Floor of Alexandra House at 18 Chater Road in Central, Hong Kong. Philip Brendan Gilligan, the company's liquidator, will present at the meeting a report about the company's wind-up proceedings and property disposal. JONESWIN INVESTMENT: Members' Final Meeting Set for June 26 ----------------------------------------------------------- The members of Joneswi Investment Limited will have their final meeting on June 26, 2007, at 3:00 p.m., to hear the liquidator's report about the company's wind-up proceedings and property disposal. The meeting will be held in Room 2310, 23rd Floor of Hang Lung Centre in Causeway Bay, Hong Kong. KAWAMURA CO: Moves Annual Creditors' Meeting to June 18 ------------------------------------------------------- Kawamura Co. Limited adjourned the annual creditors' meeting from June 1, 2007, to June 18, at 11:00 a.m., since the creditors present at the initial meeting was less than the requirement under the law. At the meeting, the creditors will be asked to determine whether or not to accept certain accounts receivable to be bad debt. The company's liquidator is: Cheng Hong Cheung c/o Allied Kajima Building, Room 1005 138 Gloucester Road Wanchai, Hong Kong MANITOWOC COMPANY: Wants to Redeem 10-1/2% Senior Notes ------------------------------------------------------- The Manitowoc Company Inc. will redeem its 10-1/2% Senior Subordinated Notes due 2012, effective Aug. 1, 2007. As set forth in the indenture for the notes, Manitowoc will pay holders 105.25% of the principal amount plus accrued and unpaid interest up to the redemption date. The company will redeem all of the notes for approximately US$129 million, including interest payments and related costs. At Dec. 31, 2006, the notes represented US$113.8 million of the company's US$264.3 million in long-term debt. The notes were issued in August 2002 in conjunction with the company's acquisition of Grove Investors, Inc. The Bank of New York, trustee for the issue, will redeem notes at its offices in New York. Headquartered in Maniwotoc, Wisconsin, The Manitowoc Company Inc. (NYSE: MTW) -- http://www.manitowoc.com/-- provides lifting equipment for the global construction industry, including lattice-boom cranes, tower cranes, mobile telescopic cranes, and boom trucks. As a leading manufacturer of ice-cube machines, ice/beverage dispensers, and commercial refrigeration equipment, the company offers the broadest line of cold-focused equipment in the foodservice industry. In addition, the company is a leading provider of shipbuilding, ship repair, and conversion services for government, military, and commercial customers throughout the maritime industry. The company has operations in China and Italy. * * * The Manitowoc Company Inc. carries Moody's Investors Service 'Ba3' Corporate Family Rating and 'Ba3' Senior Unsecured Debt Rating. MOLESWORTH INVESTMENTS: Placed Under Voluntary Liquidation ---------------------------------------------------------- At an extraordinary general meeting held on June 1, 2007, the members of Molesworth Investments Limited decided to shut down the company's business. Natalia K M Seng and Susan Y H LO were appointed as liquidators. The Liquidators can be reached at: Natalia K M Seng Susan Y H LO Level 28, Three Pacific Place 1 Queen's Road East Hong Kong MULTI WAY: Taps LO Kwok Wai as Liquidator ----------------------------------------- During a meeting held on June 8, 2007, the shareholders passed a special resolution winding up the company's operations and appointing LO Kwok Wai as liquidator. Creditors must file their proofs of debt by July 7, 2007, to be included in the sharing of the company's dividend distribution. The Liquidator can be reached at: LO Kwok Wai Office No. 10 Hong Kong Plaza, 40th Floor No. 188 Connaught Road West Hong Kong OIL SHIPPING: Sets Members' Final Meeting for July 9 ---------------------------------------------------- Oil Shipping (Hong Kong) Limited will hold the final meeting for its members on July 9, 2007, at 10:00 a.m., on Level 28 of Three Pacific Place at 1 Queen's Road in East, Hong Kong. Cheng Pik Yuk, the company's liquidator, will present at the meeting, a report about the company's wind-up proceedings and property disposal. The Liquidator can be reached at: Cheng Pik Yuk Three Pacific Place, Level 28 1 Queen's Road East Hong Kong SGIS SONGSHAN: Xinhua Lifts Credit Rating to BB ----------------------------------------------- Xinhua Far East China Ratings upgraded SGIS Songshan Co Ltd's issuer credit rating from BB- to BB. The company's rating outlook was also changed from negative to stable. The rating action was mainly prompted by the present better-than-expected sector environment, expectations that the company's financial flexibility will further improve in the favorable domestic capital market, and the company's strengthening strategic position while the sector is undergoing consolidation. Even so, SGIS's investment in capacity and technology has not significantly improved its competitive position, with the company's aggressive financial policies and its poor record in coping with industry downturns preventing it from obtaining a higher rating. With China's steel prices recovering in 2006, SGIS's turnover rose by 16.9% to CNY12.4 billion in 2006. The company's gross margin rose to 7% in 2006 from 4.1% in 2005 and, with prices continuing to rise in 2007, its gross margin reached 8.6% in the first quarter of 2007. We expect strong domestic and foreign demand will offset the pressures the company faces from overcapacity and rises in input costs. A better-than-expected sector environment may help it to avoid facing extremely tough demands on capital in the near term. SGIS issued CNY1,538 million in convertible bonds to replace the same amount worth of bank loans in February 2007. We believe most bond investors will convert the bonds to common stock given that its common stock price is significantly above the strike price, a move which will lower the company's debt to capital ratios. With the steel industry undergoing a new round of mergers and acquisitions in China and globally, as a result of high industry concentration upstream and intensifying competition, we expect SGIS may enjoy higher financial flexibility. SGIS is an attractive target for domestic first-tier steel groups because of its leading exposure to Guangdong Province, one of China's top steel consuming regions. Even so, the company's competitiveness remains relatively weak, compared to its domestic peers, in terms of capacity and its product mix, even though its product mix is more upgraded than it once was. Further, the company's profitability tends to be fragile when the sector goes through hard times, while its financial policies are aggressive. It also faces the possibility that its capital expenditure will rise if it cooperates with domestic large steel groups in new investment projects. We believe the progress the company has made thus far is insufficient for it to be assigned a higher rating at this time. The company's rating outlook is likely to remain stable, provided there are no unforeseen huge capital expenditure demands, with its currently disclosed capital expenditure plan expected to be covered by operating cash flow. A regional steel producer primarily focusing on China's Guangdong Province, SGIS has a capacity of more than five million tons, providing medium plates, deformed bars and wire rods. The company's controlling shareholder is Guangdong Province's State-owned Assets Supervision and Administration Commission, which holds a 45.2% stake. SMITHFIELD FOODS: Fourth Quarter Net Income Up to US39.9 Mil. ------------------------------------------------------------- Smithfield Foods Inc. reported that income from continuing operations for the fourth quarter was US$39.9 million versus income from continuing operations last year of US$6.3 million. Sales were US$3.1 billion versus US$2.7 billion a year ago. In the current quarter, Smithfield incurred a pretax charge of US$8.2 million to impair the value of certain assets within the beef segment. Also in the current quarter, certain foreign tax benefits resulted in a decrease in the company's annual tax rate, which reduced income taxes for the quarter by US$5.7 million. Last year's fourth quarter included pretax charges of US$10.0 million related to the ongoing restructuring of the company's east coast pork processing operations. Net income for the quarter, including Quik-to-Fix Foods and Smithfield Bioenergy, which are classified as discontinued operations, was US$37.0 million versus US$1.1 million in the previous year. During the fourth quarter, the company decided to sell its bioenergy operations and assets. In addition, the company recognized a loss of US$1.8 million, net of tax, on the post-closing settlement of the sale of Quik-to-Fix. Fourth Quarter Results Substantially improved margins in both packaged meats and fresh pork produced considerable gains in the Pork segment. Packaged meats volume grew 31 percent, primarily the result of the contributions of Armour-Eckrich, acquired in October 2006. Some important product categories, such as pre-cooked bacon, lunch meats, smoked sausage and dry sausage, had growth of virtually double the prior year. Beef processing margins improved significantly versus a loss a year ago, in spite of limited exports and a shortage of cattle. However, beef processing earnings were more than offset by losses in the company's cattle feeding operations which were depressed by severe winter weather, higher grain prices and higher-priced feeder cattle purchased earlier this year. International segment operations achieved a strong turnaround compared to a loss last year. Packaged meats volume increased 26 percent when the results of Jean Caby, which was contributed to Groupe Smithfield in August 2006, are excluded. Groupe Smithfield continued its strong earnings performance and Poland was profitable versus a loss last year. Romania experienced only a modest loss due to lower volume levels as the business ramps up. Hog production results were below a year ago due to higher raising costs and the impact of circovirus. Raising costs in the U.S. Averaged US$46 per hundredweight versus US$40 per hundredweight last year. The company marketed nine percent fewer head domestically in this quarter versus the same quarter last year. The company is receiving a greater supply of vaccine and is making substantial progress in increasing production levels. Live hog market prices in the U.S. averaged US$47 per hundredweight compared with US$42 per hundredweight last year. Results in Smithfield Foods' Other segment were below those of last year because of higher raising costs in the company's turkey growout operations versus favorable market conditions for live turkeys last year. The lower results in growout operations were somewhat offset by higher volume and cost reductions in processing operations at Butterball, LLC, the company's 49 percent-owned joint venture. Full Year Results For fiscal 2007, the company reported income from continuing operations of US$188.4 million versus US$185.2 million last year. Net income from discontinuing operations was US$166.8 million versus net income last year of US$172.7 million. Sales were US$11.9 billion compared to US$11.4 billion in the prior year. Fiscal 2007 results include pretax charges of US$12.4 million for impairments in the beef segment and the company's investment in hog production operations in Brazil. Prior fiscal year results include pretax charges totaling US$26.3 million in connection with the restructuring of east coast pork processing operations. Pork segment earnings were above those of last year, reflecting the prior year's restructuring charges, the successful integration of Armour-Eckrich and higher margins in fresh pork and packaged meats. The contribution of Armour- Eckrich grew packaged meats volume by 20 percent. Sales volume to the retail and foodservice channels experienced strong growth. The company continued to expand packaged meats margins through a plan to improve product mix to higher value-added products, rationalize plant capacities and lower costs. Beef processing achieved earnings well above a year ago in spite of unfavorable industry conditions and the US$8.2 million impairment charge. These results were partially offset by cattle feeding losses. International profitability, compared to a loss last year, reflected improvement in all aspects of the company's European operations. Groupe Smithfield, the 50/50 joint venture with Oaktree Capital Management established with the acquisition of the Sara Lee European Meats business last August, has been showing consistently strong margin performance. Poland continued its earnings turnaround and remained solidly profitable while Romania, which successfully reopened an idle pork processing plant in November, was also profitable in spite of startup costs. Hog production results were well below last year as raising costs increased. As a result of the impact of circovirus, the number of head marketed domestically fell six percent. Live hog market prices domestically averaged almost US$48 per hundredweight versus US$46 in the prior year. Raising costs in the U.S. were US$43 per hundredweight versus US$39 per hundredweight last year. The company is building sow herds in Poland and Romania at a rapid pace. Butterball, LLC turkey processing results were well above a year ago. However, turkey production results were depressed by higher grain prices and earnings were sharply lower than last year. Combined turkey operating results were improved over last year. The company completed the acquisition of Premium Standard Farms, a vertically integrated hog producer and pork processor, on May 7. Smithfield is in the final phase of evaluating the assimilation process and anticipates synergies to begin in the first quarter of fiscal 2008. "Considering the negative impact of increased grain prices on all of our live production operations, I am very pleased with the results for the fourth quarter and the full fiscal year, particularly the international and pork segments," said C. Larry Pope, president and chief executive officer. "The acquisitions that we made this past year have been immediately accretive to earnings. We are reshaping the company through integrating these acquisitions, both branded packaged meats businesses, and executing a strategy to realign and rationalize our manufacturing capacities," said Mr. Pope. "We have maintained our focus on utilizing our raw materials internally and eliminating low margin business and the fourth quarter reflects the impact of these changes. Our international operations are beginning to deliver significantly improved results and our domestic packaged meats margins are sharply improved." Mr. Pope continued, "Our investments in Poland and Romania are part of a long-term strategy. While near-term results are modest and just beginning to bear fruit, we expect continually improving results as these businesses mature and achieve economies of scale. We believe these hog production and meat processing operations have strategic competitive advantages not only in their respective domestic markets, but also across Western and Eastern Europe." Mr. Pope said that Smithfield continues to evaluate manufacturing operations to drive out significant costs and become a low-cost, highly-efficient producer. "We plan additional changes to realign capacity. Our strategy is to invest in new technologies and processes to improve operating efficiencies and enable our packaged meats business to become a much stronger component of our profits," he said. "Looking forward, in spite of the anticipated increase in grain costs, I am very optimistic about the future. Grain prices, as well as increases in freight and energy costs, are impacting our operations," Mr. Pope said. "However, we are raising prices in an effort to offset these costs and we are focusing on driving out inefficiencies. The opening of the Korean market to United States beef exports and the continued opening of the Japan market is good news for our beef processing business. Cattle feeding should have a much better year and we are seeing improvement in our hog production operations from use of the circovirus vaccine. Importantly, I expect continued improvement in our packaged meats margins. All of this bodes well for the company, in spite of rising input costs. Fiscal 2008 should be a stronger year than fiscal 2007," he said. New Chief Financial Officer Smithfield Foods today named Carey J. Dubois vice president and chief financial officer, effective July 1. Mr. Dubois has been treasurer of Smithfield since 2005. Over the past two decades, Mr. Dubois, 47 years old, has held financial positions at Bunge Limited, Pepsi Bottling Group, Joseph E. Seagram and Sons, and Louis Dreyfus Corporation. "Carey has made significant contributions to our team while we have made several major acquisitions. His international expertise has been invaluable as we have established important new businesses in Europe," said Mr. Pope. "His financial acumen will make a difference at Smithfield." Mr. Dubois succeeds Robert W. Manly IV, executive vice president, who has been serving as interim chief financial officer. About Smithfield Foods Smithfield Foods, Inc., headquartered in Smithfield, Virginia, is the largest vertically integrated producer and marketer of fresh pork and processed meat in the US and has operating subsidiaries and joint ventures in France, Poland, Romania, the UK, Brazil, Mexico, and China. * * * As reported in the Troubled Company Reporter-Latin America on Jan. 2, 2007, Moody's Investors Service downgraded the ratings of Smithfield Foods' senior unsecured debt to Ba3 from Ba2, its senior subordinated notes to B1 from Ba2, and its corporate family rating to Ba2 from Ba1. Moody's also affirmed Smithfield's SGL-3 speculative grade liquidity rating. Moody's said the outlook on all ratings is negative. TCL MULTIMEDIA: Posts HK$2.5 Billion Net Loss for FY 2006 --------------------------------------------------------- TCL Multimedia Technology Holdings Ltd recorded a net loss of HK$2.5 billion on HK$29.18 billion of turnover for the full year ended Dec. 31, 2006, compared with a net loss of HK$703.28 million on HK$32.50 billion of turnover in 2005. According to the company, the decline in turnover and gross profit was mainly due to the winding down of the Group’s legacy Europe business implemented since October 2006. "Although the Group managed to achieve satisfactory performance in other key markets, the profits could not compensate for the substantial operating loss and the costs and impairment provisions for restructuring incurred by the Europe business, resulting in a net loss attributable to equity holders of the parent of HK$2,497 million for the year under review." As of Dec. 31, 2006, the company's unaidited balance sheet showed strained liquidity with current assets of HK$9.65 billion available to pay current liabilities of HK$10.66 billion. In addition, the company's balance sheet as of Dec. 31 showed total assets of HK$12.4 billion and total liabilities of HK$10.71 billion, resulting to a shareholders' equity of HK$1.69 billion. Headquartered in New Territories, Hong Kong, TCL Multimedia Technology Holdings Limited -- http://www.tclhk.com/-- designs, manufactures and sells electronic products like colored TV, DVD players, VCD players, home cinema hi-fi systems, mobile handsets, Internet-related information technology products,refrigerators and washing machines. Its other activity includes trading electronic parts and components used in the production of color television sets. On Aug. 31, 2006, the Troubled Company Reporter - Asia Pacific reported that TCL Multimedia Technology Holdings Limited's European operations posted a CNY763 million loss, which caused losses of the TCL Corp. group to widen to CNY737.56 million. Moreover, the TCR-AP on Oct. 24, 2006, said that TCL is expecting to post a loss for the full-year because first-half losses had been so large. In the first half of 2006, TCL reported a net loss of CNY737.56 million, after a loss of CNY320.24 million in 2005. The TCR-AP recounts that in 2004, TCL acquired the TV unit of French electronics firm Thomson, which uses the Thomson brand in Europe and RCA in North America. TCL grouped all its TV businesses under TMT. TTE Europe SAS, TCL's European unit, filed a declaration of insolvency on May 24, 2007 in France after it failed to settle a number of outstanding liabilities. VARIETAL DISTRIBUTION: Moody's Puts Corporate Family Rtg. at B3 --------------------------------------------------------------- Moody's Investors Service assigned a B3 Corporate Family Rating to Varietal Distribution Merger Sub, Inc. (formerly VWR International, Inc.). Moody's will be withdrawing ratings assigned to VWR International, Inc., CDRV Investors, Inc. and CDRV Investment Holdings Corporation. The ratings outlook is stable. This rating action follows a May 2, 2007 announcement that the parent company of VWR International, Inc., CDRV Investors, Inc. entered into an agreement and plan of merger among Varietal Distribution Holdings, LLC and its wholly-owned subsidiary, Varietal. Under the proposed merger agreement, Varietal will merge with and into CDRV. As a result, CDRV will continue as a wholly-owned subsidiary of Holdings, and Varietal will cease to exist. Thus, the ratings being assigned to Varietal will become ratings of CDRV once the merger is completed. Holdings is an affiliate of Madison Dearborn Partners, LLC, (the sponsor) which is acquiring Varietal for approximately US$3.8 billion, including the assumption of US$2.6 billion of total outstanding debt of: VWR International, Inc., CDRV Investors, Inc. and CDRV Investment Holdings Corporation. Moody's expects that the transaction will be financed with US$2.6 billion of new debt and US$1.4 billion of preferred equity. The total transaction consideration represents approximately 14.8 times pro-forma EBITDA of US$270 million for the twelve month period ended March 31, 2007. The B3 Corporate Family Rating reflects the significant level of outstanding debt relative to the limited cash flow of the new company. Although Varietal benefits from the size, stability and diversity of its distribution business, the company's cash flow is constrained by low operating margins and high interest expense. Moody's also expects minimal debt reduction, and thus very little improvement in the company's key credit metrics, including cash flow coverage of adjusted debt and debt/EBITDA, over the next few years. Moody's also notes that it is treating 50% of total preferred stock (approximately US$700 million) as debt instead of equity, which further constrains the credit metrics of the company. Ratings to be assigned to Varietal Distribution Merger Sub, Inc.: -- US$250 Multi-Currency Revolving Credit Facility, rated B1, LGD-2, 26%; -- US$715 Million USD Senior Secured Term Loan B, rated B1, LGD-2, 26%; -- US$700 Million Euro Senior Secured Term Loan B, rated B1, LGD-2, 26%; -- US$675 Million Senior Unsecured Notes, rated Caa1, LGD-5, 73%; -- Corporate Family Rating, B3; -- Probability of Default Rating, B3; -- Speculative Grade Liquidity Rating, SGL-3. These ratings assigned to VWR International, Inc. will be withdrawn once the financing is completed: -- US$175 Million Senior Secured EURO Term Loan, Ba2, LGD2, 12%; -- US$415 Million Senior Secured Guaranteed US Dollar Term Loan, due 2009, Ba2, LGD2, 12%; -- US$150 Million Senior Secured Guaranteed Revolver, due 2009, Ba2, LGD2, 12%; -- US$200 Million 6.875% Senior Unsecured Guaranteed Notes, due 2012, B1, LGD3, 40%; -- US$320 Million Senior Subordinated Unsecured Notes, due 2014, B3, LGD4, 62%; -- Speculative Grade Liquidity Rating, SGL-2. These ratings assigned to CDRV Investors, Inc. will be withdrawn once the acquisition is completed: -- US$350 Million Senior Floating Rate Notes, Caa1, LGD6, 92%. These ratings assigned to CDRV Investment Holdings Corporation will be withdrawn once the acquisition is completed: -- US$481 Million (face value) Senior Discount Notes, due 2015, rated Caa1, LGD5, 79%. These ratings are subject to Moody's review of the final documentation associated with this transaction. Varietal Distribution Merger Sub, Inc. (to be merged with and into CDRV), headquartered in West Chester, Pennsylvania, is a global leader in the distribution of scientific supplies, with worldwide sales of US$3.26 billion in 2006. The company's business is highly diversified across a spectrum of products and services, customer groups and geography. Headquartered in West Chester, Pennsylvania, VWR International, -- http://www.vwr.com-- is engaged in the distribution of scientific products. It serves more than 250,000 customers in the life science, industrial, governmental, health care and educational markets, and also offers Production Supplies and Services for electronic and pharmaceutical production. The company offers more than 750,000 products, from more than 5,000 manufacturers, to over 250,000 customers throughout North America, Austria, Mexico and China. VWR INT’L: Pending Madison Dearborn Deal Cues S&P to Hold B Rtg. ---------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'B' corporate credit rating on VWR International Inc. and removed it from CreditWatch, where it had been placed with negative implications on May 3, 2007. The outlook is stable. At the same time, Standard & Poor's assigned its 'B+' bank loan rating to Varietal Distribution Merger Sub Inc.'s US$250 million senior secured revolving credit facility maturing 2013 and US$1.415 billion senior secured term loan due 2014. Standard & Poor's also assigned a recovery rating for both loans of '2', indicating that lenders can expect substantial (70%-90%) recovery in the event of a payment default or bankruptcy. S&P also assigned a 'CCC+' rating to Varietal's US$675 million senior unsecured notes due 2015, to be privately placed by the company in reliance on Rule 144A. The senior notes are rated two notches below the 'B' corporate credit rating as, in bankruptcy, recovery would be materially reduced by the large amount of secured debt. "These actions reflect the pending acquisition of VWR by a unit of private equity sponsor Madison Dearborn Partners LLC from previous owner Clayton, Dubilier & Rice," explained Standard & Poor's credit analyst David Lugg. "Although this largely debt-financed transaction will markedly increase adjusted leverage, the medium term cash requirements are well within VWR's internal cash generating capacity." When S&P treat MDP's preferred stock investment as an intermediate equity content hybrid with 50/50 debt to equity, S&P estimate adjusted debt to EBITDA will be more than 11x at year-end 2007. However, the preferred dividend is pay-in-kind, not cash, and loan amortization is not required until 24 months after closing. Moreover, interest payment on the senior notes can be all cash, 50% cash and 50% pay-in-kind, or 100% pay-in-kind at the issuer's discretion. Given VWR's well-established role as one of two leading distributors of laboratory supplies--a slowly growing but stable market--Standard & Poor's believes that the company has adequate capacity to meet cash needs. The speculative-grade ratings on VWR, a distributor of research laboratory products, reflect its heavy debt burden and VWR's well-established position in the stable and attractive laboratory supply market. Headquartered in West Chester, Pennsylvania, VWR International, -- http://www.vwr.com-- is engaged in the distribution of scientific products. It serves more than 250,000 customers in the life science, industrial, governmental, health care and educational markets, and also offers Production Supplies and Services for electronic and pharmaceutical production. The company offers more than 750,000 products, from more than 5,000 manufacturers, to over 250,000 customers throughout North America, Austria, Mexico and China. ZTE CORP: Russia's Sistema Inks Various Telecom Deals ----------------------------------------------------- Russian services conglomerate Sistema, which controls Russia's top mobile phone firm, has signed a range of deals with China's ZTE Corp, Vladimir Yevtushenkov, Sistema's main owner, told Reuters. Speaking about the fringes of the St. Petersburg International Economic Forum, Mr. Yevtushenkov told Reuters that his firm had signed a number of agreements with ZTE. "We've signed a deal with ZTE, the Chinese telecoms company, on the development of joint businesses, to set up joint R&D centres, on the joint acquisitions of enterprises in China and possibly development of joint products under a joint brand." Mr. Yevtushenkov added that Sistema already buys equipment from China, where suppliers were far competitive than in Europe. "The value of today's deal, well, it's not one deal but a range of deals which will continue in the future, so I don't want to put a price on it. But it's big, hundreds of millions (of dollars)," Sistema's owner indicated to the news agency. Headquartered in Shenzhen, China, ZTE Corp -- http://www.zte.com.cn/-- produces and sells general system and communication terminal equipment. The group operates both in the domestic and international market. The Troubled Company Reporter - Asia Pacific reported on Dec. 1, 2006, that Fitch Ratings assigned ZTE Corp. long-term foreign and local currency Issuer Default ratings of 'BB+'. The rating outlook is stable. ZTE CORP: To Build China Mobile's CNY2.37BB Wireless Network ------------------------------------------------------------ ZTE Corp signed a CNY2.37 billion, US$310 million, contract to build a high-speed wireless network for China Mobile Communications Corp, Xinhuanet News relates, citing a report from Bloomberg News. The company, according to a report from The Standard, will supply mobile-phone network equipment based on the time division synchronous code division multiple access, or TD-SCDMA, technology, worth about CNY2.13 billion to China Mobile Communications, while the rest of the order covers services, Xinhuanet relates. The newspaper recounts that ZTE said in April it won orders from China Mobile though the company didn't provide the size of the contract at the time. Headquartered in Shenzhen, China, ZTE Corp -- http://www.zte.com.cn/-- produces and sells general system and communication terminal equipment. The group operates both in the domestic and international market. The Troubled Company Reporter - Asia Pacific reported on Dec. 1, 2006, that Fitch Ratings assigned ZTE Corp. long-term foreign and local currency Issuer Default ratings of 'BB+'. The rating outlook is stable. ========= I N D I A ========= ALGOMA STEEL: High Debt Leverage Cues S&P’s B Credit Rating ----------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B' corporate credit rating to Algoma Steel Inc. The outlook is stable. At the same time, S&P assigned a 'BB-' rating to the company's proposed US$450 million first-lien term loan due 2013 with a recovery rating of '1'. S&P also assigned a 'B-' rating to the company's proposed US$450 million senior unsecured notes due 2015. "The ratings on Algoma Steel reflect its limited operating diversity, high debt leverage, and exposure to the volatile North American steel industry," said Standard & Poor's credit analyst Donald Marleau. "These risks are counterbalanced by a good cost profile and good integration of key inputs." Algoma Steel will be 100% acquired by Essar Steel Holdings Ltd. later in June 2007 for US$1.6 billion, financed in part with US$1.1 billion of new debt issued by Algoma Steel. The rated debt is non-recourse to Essar, and hence, the ratings reflect only Algoma's standalone credit quality. The ownership by Essar is not currently a significant rating factor, but it may become increasingly important if Essar uses Algoma as an aggressive growth vehicle to execute its North American strategy. AMERICAN AXLE: S&P Rates Proposed US$250 Million Term Loan at BB -------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB' rating to American Axle & Manufacturing Inc.'s proposed US$250 million senior unsecured term loan due 2012. The parent company, American Axle & Manufacturing Holdings Inc., is the guarantor. Proceeds are expected to be used to repay existing debt. In addition, the 'BB' corporate credit ratings on the Detroit-based auto supplier and its parent company were affirmed. The rating outlook is negative. "The ratings on American Axle reflect the risks associated with the company's heavy dependence on General Motors Corp. (GM; B/Negative/B-3) SUVs and pickup trucks, current relatively narrow product range, and exposure to cyclical and competitive markets," said Standard & Poor's credit analyst Robert Schulz. The ratings could be lowered if free cash flow generation remains negative during 2007, reducing the company's cash balances. Potential causes for negative cash flow would include substantially weaker demand for GM's light trucks. S&P could also lower the rating if GM's credit profile were to substantially weaken. On the other hand, the outlook could be revised to stable if the company improves its customer and product diversity through acquisitions or investments that do not cause credit measures to weaken, or if demand for light trucks stabilizes or strengthens. In addition to locations in the United States, AAM also has offices or facilities in Brazil, China, England, Germany, India, Japan, Mexico, Poland, Scotland and South Korea. GENERAL MOTORS: Says It Is Making Progress in Restructuring ----------------------------------------------------------- General Motors Corp Chief Executive Officer Rick Wagoner told Newratings.com that the firm was making significant progress in its restructuring. General Motors incurred over US$12 billion losses in the last two years, published reports say. According to the report, Mr. Wagoner said that General Motors has rid of over 34,000 jobs. General Motors' losses dropped to US$2 billion in 2006, compared to US$10.4 billion in 2005, Newratings.com notes. Mr. Wagoner told Newratings.com that he is positive that General Motors would soon reach a settlement with Delphi Corporation, a supplier of vehicle electronics, transportation components, integrated systems and modules, and other electronic technology. Headquartered in Detroit, GM General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908, GM employs about 280,000 people around the world. With global manufactures its cars and trucks in 33 countries, including Brazil, India, and Beligium. In 2006, nearly 9.1 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn and Vauxhall. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. * * * As reported in the Troubled Company Reporter on May 28, 2007, Standard & Poor's Ratings Services placed General Motors Corp.'s corporate credit rating at B/Negative/B-3. At the same time, Moody's Investors Service affirmed GM's B3 Corporate Family Rating and B3 Probability of Default Rating, and maintained its SGL-3 Speculative Grade Liquidity Rating. Moody’s said the rating outlook remained negative. RPG LIFE SCIENCES: Board to Consider Scheme of Arrangement Today ---------------------------------------------------------------- RPG Life Sciences Ltd's board of directors will hold a meeting today, June 12, 2007, a filing with the Bombay Stock Exchange says. Among others, the board will consider at the meeting a scheme of arrangement under sections 391 to 394 of the Companies Act, 1956. The scheme of arrangement seeks to separate the pharmaceutical business and investments (including loans and advances) in RPG's subsidiary company into two separate companies. The scheme, if approved by the board, would be subject to approval by the company's members and creditors, and the Bombay High Court. Headquartered in Mumbai, India, RPG Life Sciences Ltd -- http://www.rpglifesciences.com/-- is a full spectrum, world class, customer focused, innovative pharmaceutical organization. Formerly known as Searle (India) Ltd., the company develops, manufactures and markets, for national and international markets, a broad range of branded formulations, generics and bulk drugs developed through fermentation and chemical synthesis routes. On April 17, 2003, Credit Analysis and Research Limited downgraded the rating of the outstanding NCD program of INR145.5 million of RPG Life Sciences rating from CARE BBB to CARE D. The downgrade is on account of a default in debt servicing obligations towards institutional investors TATA MOTORS: May 2007 Sale Decreases 4% From Last Year's -------------------------------------------------------- Tata Motors reported a total sale of 42,558 vehicles (including exports) for the month of May 2007, a decline of 4% over vehicles sold in May last year. Cumulative sales for the company at 83,044 units are growing by 3%. Vehicles sales in the domestic market were impacted, in varying degrees between the commercial and passenger vehicles segments, due to the high interest rate regime severely affecting retails. Commercial Vehicles The company’s sales of commercial vehicles in May 2007 in the domestic market were 20,675 units, a decline of 6% over 21,903 vehicles sold in May last year. Medium and Heavy Commercial Vehicle sales stood at 10,500 units, a decline of 17% over May 2006, while LCV sales were 10,175 units, a growth of 10% over May 2006. Cumulative sales of commercial vehicles in the domestic market for the fiscal were 40,282 units, a decline of 3% over last year. Cumulative M&HCV sales stood at 20,892 units, a decline of 16% over last year, while Light Commercial Vehicle sales for the fiscal were 19,390 units, an increase of 16% over last year. Passenger Vehicles The passenger vehicle business reported total sales of 17, 580 vehicles in the domestic market in May 2007, a decline of 3% over May 2006. The Indica reported sales of 12,002 units, a decline of 3% over May 2006. The Indigo family registered sales of 2,215 units, a decline of 22% over May 2006. The Sumo and Safari accounted for sales of 3,363 units, an increase of 18% over May 2006. Cumulative sales of passenger vehicles in the domestic market for the fiscal were 34,422 units, an increase of 9% over the previous year. Cumulative sales of the Indica were at 22,872 units, an increase of 9%. Cumulative sales of the Indigo family were at 4,847 units, a decline of 11%. Cumulative sales of Sumo and Safari were 6,703 units, an increase of 31%. Exports The company's sales from exports were flat at 4,303 vehicles in May 2007 as compared to 4,339 vehicles in May 2006. The cumulative sales from exports in the current period at 8,340 units have recorded a 5% growth over the previous year. About Tata Motors India's largest automobile company, Tata Motors Limited -- http://www.tatamotors.com/-- is mainly engaged in the business of automobile products consisting of all types of commercial and passenger vehicles, including financing of the vehicles sold by the Company. The Company's operating segments consists of Automotive and Others. In addition to its automotive products, it offers construction equipment, engineering solutions and software operations. * * * As reported in the Troubled Company Reporter - Asia Pacific on Dec. 13, 2006, Standard & Poor's Ratings Services raised its corporate credit ratings for Tata Motors to 'BB+' from 'BB'. The outlook is stable. At the same time, Standard & Poor's has raised its rating on Tata Motors' senior unsecured notes to 'BB+' from 'BB'. Moody's Investors Service, on July 26, 2005, gave Tata Motors 'Ba1' long-term corporate family and senior unsecured debt ratings. TATA POWER: Net Profit Down 33% in January-March 2007 Quarter ------------------------------------------------------------- Tata Power Company Ltd's posted a net profit of INR927.30 million for the quarter ended March 31, 2007, down 33% from the INR1.39 billion earned in the quarter ended March 31, 2006. Total income decreased from INR12.47 billion for the quarter ended March 31, 2006, to INR11.26 billion in the latest quarter under review. Expenses decreased 7% to INR9.42 billion, bringing the operating profit to INR1.84 billion. For the year ended March 31, 2007, the company booked a profit after tax of INR6.97 billion, an increase from the INR6.11 billion a year ago. Total income increased from INR48.60 billion for the year ended March 31, 2006, to INR50.59 billion in FY2007. The company's board of directors at its meeting held on May 30, 2007, recommended a dividend at 95% (INR9.50 per share) to shareholders for the year ended March 31, 2007. The annual general meeting of the members of the company will be held on August 8, 2007. Tata Power Company Ltd. -- http://www.tatapower.com/-- is a licensee engaged in generation and supply power to bulk consumers in the Mumbai metropolitan area. The company operates four thermal plants with a combined capacity of 1,350 MW, and three hydroelectric plants aggregating 447 MW; all of these supply power to the Mumbai licence area. The company also has a plant that supplies power to Tata Steel. In addition, Tata Power has an 81-MW independent power project at Belgaum that sells power to Karnataka Power Transmission Corporation Limited. * * * On May 9, 2007, Standard & Poor's Ratings Services placed its 'BB+' long-term foreign and local currency corporate credit ratings on Tata Power Co. Ltd. on CreditWatch with negative implications reflecting significantly greater concerns on the company's debt and on its exposure to higher project completion, stabilization, and counterparty risks. Moody's Investors Service, on Jan. 30, 2007, placed its Ba1 corporate family rating and Ba2 senior unsecured debt rating for Tata Power Company Ltd on review for possible downgrade. UNION BANK OF INDIA: T. Y. Prabhu Named New Executive Director -------------------------------------------------------------- The Union Bank of India informs the Bombay Stock Exchange that the Central Government, after consultation with the Reserve Bank of India, has appointed T. Y. Prabhu, General Manager, Canara Bank, as UBI's executive director. Mr. Prabhu started on hi new post with UBI on June 6, 2007. The appointment is effective from that date and until further orders, or until the date of his superannuation i.e. up to December 31, 2010, whichever is earlier. Union Bank of India -- http://www.unionbankofindia.com/-- is one of the 10 largest Indian banks with total assets of more than INR800 billion as of March 31, 2006. Union Bank was incorporated in 1919 at Mumbai and was nationalized during the first round of bank nationalization in 1969. Until August 2002, GoI fully owned the bank; currently, GoI has a 55% stake. The bank has a nationwide presence with a geographically diversified branch network. As of March 31, 2006, it had 2,082 branches and 145 extension counters. * * * The Troubled Company Reporter - Asia Pacific reported on Oct. 23, 2006, that Fitch Ratings upgraded the Bank's individual rating to 'C/D' from 'D.' Moody's Investors Service gave the bank's foreign long-term bank deposits a Ba2 rating. UTI BANK: To Raise US$1 Billion by Share Issuance ------------------------------------------------- UTI Bank Ltd plans to raise US$1 billion in Tier I capital through a combination of overseas issue and a preferential issue to promoters, India Infoline News reports. In a filing with the Bombay Stock Exchange, UTI Bank discloses its plan to increase the bank's authorized capital from INR3 billion to INR5 billion. The bank's board of directors, at its meeting on on June 1, 2007, has made these decisions: 1. To raise Tier—I capital of the bank by way of issue of equity shares not exceeding 4,23,97,400 equity shares, equity shares through depositary receipts, or securities convertible into equity shares at the option of the holder. 2. To offer to the Promoters to subscribe 3,19,25,561 shares on preferential allotment basis if they so desire. 3. To increase the authorized share capital of the bank from INR300 crore to INR500 crore. 4. To alter the Memorandum and Articles of Association of the bank to give effect to the increase in the authorized share capital. 5. To convene an Extraordinary General Meeting of the shareholders of the Bank on June 25, 2007 for the above purpose. Headquartered in Ahmedabad, India, UTI Bank Limited -- http://www.utibank.com/-- is engaged in treasury and other banking operations. The treasury services segment undertakes trading operations on the proprietary account, foreign exchange operations and derivatives trading. Revenues of the treasury services segment primarily consist of fees and gains or losses from trading operations and interest income on the investment portfolio. Other banking operations principally comprise the lending activities (corporate and retail) of the bank. The corporate lending activity includes providing loans and transaction services to corporate and institutional customers. The retail lending activity includes raising of deposits from customers and providing loans and advisory services to customers through branch network and other delivery channels. Total deposits were INR31,712 crore at March 31, 2006. * * * On November 6, 2006, Moody's Investors Service assigned a Ba1 rating to the foreign currency perpetual non-cumulative subordinated debt to be issued by UTI Bank's Singapore branch under its US$1-billion Medium Term Note program. The Troubled Company Reporter - Asia Pacific reported on Feb. 1, 2006, that Standard & Poor's Ratings Services maintained its 'C' bank fundamental strength rating to the bank. Another TCR-AP report on July 26, 2006, related that Fitch Ratings assigned an individual rating of C/D to UTI Bank. The outlook on the rating is stable. UTI BANK: Shareholders Okay Dividend of INR4.5 Per Share -------------------------------------------------------- At the annual general meeting on June 1, 2007, the members of UTI Bank Ltd passed a resolution for the payment of dividend at 45% (i.e. INR4.50 per equity share). The dividend warrants will be dated and payable from June 2, 2007. Other resolutions passed during the AGM include those for: 1. The reappointment as directors of Surendra Singh, Dr. R. H. Patil and Smt. Rama Bijapurkar who retired by rotation. 2. The reappointment of S. R. Batliboi & Co. as statutory auditors for the year 2007-08. 3. The revision of the remuneration payable to P. J. Nayak as Chairman and Managing Director with effect from April 1, 2007. 4. Change of the the bank's name from "UTI Bank Ltd" to "Axis Bank Ltd" and to make necessary changes in the Memorandum and Articles of Association and other documents to that effect. 5. In accordance with Section 10-B of the Banking Regulation Act, 1949 and subject to approval by the Reserve Bank of India, appoint P. J. Nayak as whole-time chairman of the bank for the period August 1, 2007, to July 31, 2009. 6. Subject to RBI's approval, to approve remuneration payable to Mr. Nayak as the whole-time chairman. Headquartered in Ahmedabad, India, UTI Bank Limited -- http://www.utibank.com/-- is engaged in treasury and other banking operations. The treasury services segment undertakes trading operations on the proprietary account, foreign exchange operations and derivatives trading. Revenues of the treasury services segment primarily consist of fees and gains or losses from trading operations and interest income on the investment portfolio. Other banking operations principally comprise the lending activities (corporate and retail) of the bank. The corporate lending activity includes providing loans and transaction services to corporate and institutional customers. The retail lending activity includes raising of deposits from customers and providing loans and advisory services to customers through branch network and other delivery channels. Total deposits were INR31,712 crore at March 31, 2006. * * * On November 6, 2006, Moody's Investors Service assigned a Ba1 rating to the foreign currency perpetual non-cumulative subordinated debt to be issued by UTI Bank's Singapore branch under its US$1-billion Medium Term Note program. The Troubled Company Reporter - Asia Pacific reported on Feb. 1, 2006, that Standard & Poor's Ratings Services maintained its 'C' bank fundamental strength rating to the bank. Another TCR-AP report on July 26, 2006, related that Fitch Ratings assigned an individual rating of C/D to UTI Bank. The outlook on the rating is stable. ================= I N D O N E S I A ================= ALCATEL-LUCENT: Inks Two-Year Agreement with Comcel --------------------------------------------------- Mexican daily El Financiero reports that Alcatel-Lucent has signed a two-year accord with Haitian operator Comcel to offer wireless broadband in rural areas. Business News Americas relates that the pact will allow coffee cooperatives to trace the movement of their products using "RFID transmitted over WiMax broadband technology." These products are "sold under the fair trade label." Producers must make sure that the coffee is distributed through a minimum number of intermediaries. The agreement also includes the setting up of telecenters for services related to health, education, ecotourism and e-government, BNamericas states. Headquartered in Paris, France, Alcatel-Lucent -- http://www.alcatel-lucent.com/-- provides solutions that enable service providers, enterprises and governments worldwide to deliver voice, data and video communication services to end users. Alcatel-Lucent maintains operations in 130 countries, including, Austria, Germany, Hungary, Italy, Netherlands, Ireland, Canada, United States, Costa Rica, Dominican Republic, El Salvador, Guatemala, Peru, Venezuela, Australia, Indonesia, Brunei and Cambodia. On Nov. 30, 2006, Alcatel and Lucent Technologies Inc. completed their merger transaction, and began operations as a communication solutions provider under the name Alcatel-Lucent on Dec. 1, 2006. * * * As reported on April 13, Fitch Ratings affirmed Alcatel-Lucent's ratings at Issuer Default 'BB' with a Stable Outlook, senior unsecured 'BB' and Short-term 'F2' and simultaneously withdrawn them. As of Feb. 7, 2007, Moody's Investor Services puts a Ba2 rating on Alcatel's Corporate Family and Senior Debt rating. Lucent carried Moody's B1 Senior Debt rating and B2 Subordinated debt & trust preferred rating. Alcatel-Lucent's Long-Term Corporate Credit rating and Senior Unsecured Debt carried Standard & Poor's Ratings Services' BB rating. Its Short-Term Corporate Credit rating stood at B. ALCATEL-LUCENT: Christian Sapsizian Pleads Guilty of Bribe ---------------------------------------------------------- Christian Sapsizian, a former Alcatel official, has pleaded guilty of participating in bribing senior Costa Rican government officials with over US$2.5 million to secure a mobile telephone contract from Costa Rican state-run telecommunications authority, Lawfuel reports, citing the Department of Justice. Lawfuel says that Mr. Sapsizian has breached the Foreign Corrupt Practices Act. He entered the plea in U.S. District Court in Miami, before the Honorable Patricia Seitz. He pleaded "guilty to two counts, conspiracy and violating the FCPA, from a superseding indictment returned on March 20, 2007." The remaining counts will be dismissed during the sentencing on Dec. 20, 2007. Mr. Sapsizian will cooperate with law enforcement officials in their probe, Lawfuel notes. The report says that Alcatel was a French telecommunications firm whose American Depositary Receipts were traded on the New York Stock Exchange until Nov., 30, 2006. Mr. Sapsizian worked for Alcatel for over 20 years. Mr. Sapsizian was Alcatel's deputy vice president in Costa Rica at when the bribe was paid out. According to Lawfuel, Mr. Sapsizian admitted that he conspired with co-defendant Edgar Valverde Acosta -- Alcatel’s former senior country officer in Costa Rica -- and others from February 2000 through September 2004 to pay over US$2.5 million in bribes to senior Costa Rican officials to win a mobile telephone contract for Alcatel. The payments were channeled through one of Alcatel’s Costa Rican consulting companies and were then made to a director of Costa Rican state-run telecommunications authority Instituto Costarrisence de Electricidad, which was responsible for awarding all telecommunications contracts. Lawfuel notes that Mr. Sapsizian also admitted that the ICE director was an advisor to a senior government official. The bribes given were shared with the senior government official. The payments were to convince the ICE director and the senior government official to exercise their influence to start a bid process that favored Alcatel’s technology and to vote to award Alcatel a mobile telephone contract. The report says that Alcatel was awarded a US$149-million mobile telephone contract in August 2001. Lawfuel underscores that Mr. Sapsizian was sentenced with 10 years of prison, a US$250,000 fine, and US$330,000 in forfeiture. Deputy Chief Mark F. Mendelsohn and Trial Attorneys Charles Duross and Mary K. Dimke of the Criminal Division’s Fraud Section were the prosecutors in the case, according to Lawfuel. The Criminal Division’s Office of International Affairs provided substantial support in gathering evidence outside the country and in facilitating international cooperation. The Southeast Regional Branch of the U.S. Securities and Exchange Commission, the Office of the Attorney General in Costa Rica, and the Fiscalia de Delitos Economicos, Corrupcion y Tributarios in Costa Rica also helped in the case. The Federal Bureau of Investigation is continuing the investigations, Lawfuel states. Headquartered in Paris, France, Alcatel-Lucent -- http://www.alcatel-lucent.com/-- provides solutions that enable service providers, enterprises and governments worldwide to deliver voice, data and video communication services to end users. Alcatel-Lucent maintains operations in 130 countries, including, Austria, Germany, Hungary, Italy, Netherlands, Ireland, Canada, United States, Costa Rica, Dominican Republic, El Salvador, Guatemala, Peru, Venezuela, Indonesia, Australia, Brunei and Cambodia. On Nov. 30, 2006, Alcatel and Lucent Technologies Inc. completed their merger transaction, and began operations as a communication solutions provider under the name Alcatel-Lucent on Dec. 1, 2006. * * * As reported on April 13, 2007, Fitch Ratings affirmed Alcatel- Lucent's ratings at Issuer Default 'BB' with a Stable Outlook, senior unsecured 'BB' and Short-term 'F2' and simultaneously withdrawn them. As of Feb. 7, 2007, Moody's Investor Services put a Ba2 rating on Alcatel's Corporate Family and Senior Debt rating. Lucent carries Moody's B1 Senior Debt rating and B2 Subordinated debt & trust preferred rating. Alcatel-Lucent's Long-Term Corporate Credit rating and Senior Unsecured Debt carry Standard & Poor's Ratings Services' BB rating. Its Short-Term Corporate Credit rating stands at B. ALCATEL-LUCENT: Inks Tech Support & Maintenance Pact with Vivo -------------------------------------------------------------- Alcatel-Lucent said in a statement that it has signed a three-year contract with mobile phone operator Vivo to provide technical support and maintenance services. Business News Americas relates that the deal covers: -- consulting on design, -- planning, -- operation, -- optimization, and -- maintenance of Vivo's network in the metropolitan region of Sao Paulo and throughout Brazil's central western region. According to Alcatel-Lucent's statement, the contract includes maintenance and repair services in 2,300 Vivo base station sites. Vivo must have partners to guarantee a high availability of its network and optimum operational performance, while decreasing maintenance costs, BNamericas states, citing Vivo Networks and Technology Vice President Javier Rodriguez. Headquartered in Paris, France, Alcatel-Lucent -- http://www.alcatel-lucent.com/-- provides solutions that enable service providers, enterprises and governments worldwide to deliver voice, data and video communication services to end users. Alcatel-Lucent maintains operations in 130 countries, including, Austria, Germany, Hungary, Italy, Netherlands, Ireland, Canada, United States, Costa Rica, Dominican Republic, El Salvador, Guatemala, Peru, Venezuela, Indonesia, Australia, Brunei and Cambodia. On Nov. 30, 2006, Alcatel and Lucent Technologies Inc. completed their merger transaction, and began operations as a communication solutions provider under the name Alcatel-Lucent on Dec. 1, 2006. * * * As reported on April 13, 2007, Fitch Ratings affirmed Alcatel- Lucent's ratings at Issuer Default 'BB' with a Stable Outlook, senior unsecured 'BB' and Short-term 'F2' and simultaneously withdrawn them. As of Feb. 7, 2007, Moody's Investor Services put a Ba2 rating on Alcatel's Corporate Family and Senior Debt rating. Lucent carries Moody's B1 Senior Debt rating and B2 Subordinated debt & trust preferred rating. Alcatel-Lucent's Long-Term Corporate Credit rating and Senior Unsecured Debt carry Standard & Poor's Ratings Services' BB rating. Its Short-Term Corporate Credit rating stands at B. ALCATEL-LUCENT: Wins Contract From Vivo --------------------------------------- Alcatel-Lucent signs contrat with Vivo, Brazilian leading mobile service provider and the largest mobile operator in the Southern Hemisphere. Alcatel-Lucent will provide technical support and maintenance services for Vivo’s network in the metropolitan region of Sao Paulo and throughout the country’s west central region. This project reinforces the strategic partnership between Vivo and Alcatel-Lucent and solidifies the supplier leadership in operation and maintenance services for fixed and mobile networks in Brazil. The three-year contract is five times bigger than the one signed last year with Vivo and includes basic maintenance and repair services in 2,300 Vivo base station sites. Alcatel-Lucent will use its broad experience in delivering these type of services to help Vivo reduce its network operating costs while improving the overall reliability of the network. This new contract demonstrates the breadth and depth of Alcatel-Lucent’ services portfolio, as it encompasses network consulting, design and planning, network operations, optimization and maintenance. “Vivo is recognized by the market and the regulatory agency of the sector, Anatel, as the operator with the best quality phone calls in Brazil. To offer this quality in all services, we need to have partners that help us to ensure a higher level network availability and excellent performance in our operations, while reducing our ongoing maintenance costs,” said Javier Rodríguez, Vivo’s Networks and Technology Vice-President. “We have a long-standing and strong partnership with VIVO in telecommunications solutions. With this new contract, we will serve VIVO with the same dedication and excellence that makes maintenance a reason why more customers think of Alcatel-Lucent as a trusted advisor,” said Olivier Picard, President of Alcatel-Lucent’s Europe & South activities. “This is certainly a strategic gain for Alcatel-Lucent and an affirmation of the additional advantages the newly merged Alcatel-Lucent brings to the market. It also consolidates our position as a solutions integrator, business partner and services leader in Brazil.” About Vivo Controlled by the Portuguese groups Telecom and Telefónica Moviles, Vivo is the mobile telephony operator that offers the best quality of call, according to indicators from National Agency of Telecommunications. Between the competitive differentials of Vivo we can highlight: the continuous searching for excellence in services providing, with focus in quality in all contact points of customer with the operator, services of broadband data transmission based on the third generation network and the wide portfolio of products and services. By Vivo Institute, the company manages its social investments and coordinates actions of volunteerism program. Vivo’s initiatives are driven to causes of social inclusion of disabled people and education that generates opportunities, jobs and revenues. In the area of environmental responsibilities, Vivo develops various projects to preserve environment. The initiative of collecting used batteries obtained more than 105 thousand in 2006, and to promote environmental education, the operators acts with Program of Residues Management, which teaches to handle correctly all material produced and discarded by company. About Alcatel-Lucent Headquartered in Paris, France, Alcatel-Lucent -- http://www.alcatel-lucent.com/-- provides solutions that enable service providers, enterprises and governments worldwide to deliver voice, data and video communication services to end users. Alcatel-Lucent maintains operations in 130 countries, including, Austria, Germany, Hungary, Italy, Netherlands, Ireland, Canada, United States, Costa Rica, Dominican Republic, El Salvador, Guatemala, Peru, Venezuela, Indonesia, Australia, Brunei and Cambodia. On Nov. 30, 2006, Alcatel and Lucent Technologies Inc. completed their merger transaction, and began operations as a communication solutions provider under the name Alcatel-Lucent on Dec. 1, 2006. * * * As reported on April 13, 2007, Fitch Ratings affirmed Alcatel- Lucent's ratings at Issuer Default 'BB' with a Stable Outlook, senior unsecured 'BB' and Short-term 'F2' and simultaneously withdrawn them. As of Feb. 7, 2007, Moody's Investor Services put a Ba2 rating on Alcatel's Corporate Family and Senior Debt rating. Lucent carries Moody's B1 Senior Debt rating and B2 Subordinated debt & trust preferred rating. Alcatel-Lucent's Long-Term Corporate Credit rating and Senior Unsecured Debt carry Standard & Poor's Ratings Services' BB rating. Its Short-Term Corporate Credit rating stands at B. HILTON HOTELS: Selling Embassy Suites Hotel to 1022 Shady --------------------------------------------------------- Hilton Hotels Corporation has sold the 220-suite Embassy Suites Hotel in Memphis, Tennessee to 1022 Shady Grove LLC, an affiliate of Haberhill LLC. The purchase price was not disclosed and it is estimated that the new ownership group will spend US$3.5 million in additional capital to upgrade the property over and above the approximately US$2 million that Hilton Hotels Corporation has spent within the past year. The hotel will continue to be operated as an Embassy Suites Hotel by Hilton Hotels Corporation under the terms of long-term franchise and management agreements. Additionally, the popular restaurant Frank Grisanti’s will remain an important part of the property as the new owners have extended its lease through 2014, with an additional 5 year extension option. In a separate transaction, Hilton also announced that the 140-suite Homewood Suites by Hilton hotel on Poplar Avenue in Memphis has been sold to Apple REIT Companies for US$11.1 million. The property will also be operated as a Homewood Suites by Hilton hotel by Hilton Hotels Corporation under the terms of long term franchise and management agreements. The transaction was completed May 15, 2007. About Haberhill LLC Haberhill LLC -- http://www.haberhill.com/-- is a hotel investment and advisory firm that has ownership interests in numerous full service hotels including properties in Minneapolis, Washington, D.C. and Hawaii. Since its founding in 2000, Haberhill, with its founder Douglas Greene, has advised and invested in hotel transactions with an aggregate value of over US$1 billion. About Hilton Hotels Headquartered in Beverly Hills, California, Hilton Hotels Corp. -- http://www.hilton.com/-- together with its subsidiaries, engages in the ownership, management, and development of hotels, resorts, and timeshare properties, as well as in the franchising of lodging properties in the United States and internationally, including Australia, Austria, Barbados, Finland, India, Indonesia, Trinidad and Tobago, Philippines and Vietnam. * * * As reported on May 1, 2007, Standard & Poor's Ratings Services said its rating and outlook on Hilton Hotels Corp. (BB+/Stable/--) would not be affected by the company's announcement that it has entered into an agreement with Morgan Stanley Real Estate to sell up to 10 hotels for approximately US$612 million in proceeds (net of property level debt repayment, taxes, and transaction costs). Upon the close of the transactions, Hilton Hotels plans to use the net proceeds to repay debt. Standard & Poor's rating upgrade for Hilton Hotels in March 2007 incorporated the expectation that the company would sell a meaningful level of additional assets over the near term, which would likely lead to additional debt reduction. Still, Standard & Poor's is encouraged by the expected transaction multiple related to today's announcement. If the lodging transaction market remains strong, enabling Hilton Hotels to generate substantial proceeds from remaining asset sales, if these proceeds are used for debt reduction, and if the lodging environment remains strong, an outlook revision to positive could be considered as 2007 progresses. Any movement signaling the potential for a higher rating will depend on Hilton Hotels's commitment to maintaining credit measures aligned with higher ratings over the lodging cycle. In February 2007, Moody's Investors Service upgraded Hilton Hotels Corporation's corporate family rating to Ba1 from Ba2 reflecting a reduction in leverage from a faster than expected pace of asset sales and strong earnings during 2006. Adjusted debt to EBITDAR has improved to around 5.0x from 6.0x in January 2006. INDOFOOD: Cuts Capital Spending Up to 37 Percent ------------------------------------------------ PT Indofood Sukses Makmur will cut capital expenditures by as much as 37% to IDR1 trillion this year, Bloomberg News reports, citing Bisnis Indonesia. According to the report, Indofood may apply 30% of spending this year to boost its noodle-making capacity by 7.4% to IDR14.5 billion packs a year and expand plantations. The company plans to buy machinery this year for a crude palm oil refinery plant, which will be completed by 2010, the report adds. About Indofood Sukses PT Indofood Sukses Makmur Tbk (Indofood) -- http://www.indofood.co.id/-- is Indonesia's premier processed foods company. Its products, including instant noodles, wheat flour, branded edible oils and fats, baby foods, snack foods, food seasoning, lead domestic market shares. Indofood is currently the largest instant noodles manufacturer and the largest flour miller in the world, with installed capacities of approximately 13 billion packs and 3.6 million tons per annum, respectively. Indofood's products are distributed mainly through its subsidiaries, including Indomarco, independent distributors, as well as some cooperatives, which bring the Company's products to more than 150,000 retail outlets in the country. Total employees as of December 1999 were 42,172. A combination of shrinking profits, escalating costs, losses, competition and a declining rupiah prompted the Company to cut around 2,000 or 4.4% of its workforce and slash 40 products from its range in 2005. In 2005, Indofood's total outstanding debt fell to IDR6.8 trillion from IDR7.9 trillion in 2004. The United States dollar-denominated debts also fell to US$190.6 million in the same period from US$317.4 million in 2004. Indofood has bought back US$166.3 million (IDR1.55 trillion) of its US$280 million (IDR2.61 trillion) Eurobonds due in 2007. The Company also plans to redeem all the outstanding balance of the Eurobonds this year. The Troubled Company Reporter - Asia Pacific reported on July 19, 2006, that Standard & Poor's Ratings Services withdrew its 'B' corporate credit rating on Indofood at the company's request. MEDIA NUSANTRA: Raises US$419 Million in IPO -------------------------------------------- PT Media Nusantara Citra raised about US$419 million in the country's largest initial public offering since 2003 after pricing its share sale at the upper end of its indicative range. According to the report, PT Bimantara Citra Tbk controlled Media Nusantara's IPO and raised US$484 million in October 2003, citing Dealogic data. It surpasses the roughly US$280 million raised in all 12 IPOs last year on the Jakarta bourse. Moreover, Media Nusantara's subsidiaries Rajawali Citra Televisi Indonesia and Televisi Pendidikan Indonesia will make its trading debut on June 22, the report notes. The report relates that David Audi, the company's investor relations official, confirmed that the company sold 4.125 billion shares, or 30 percent of its enlarged share capital, at IDR900 per share compared with its indicative range of IDR730-950 Media Nusantara appointed Deutsche Bank, Lehman Brothers , UBS and local houses Bhakti Securities and Danareksa Sekuritas to handle the deal, the report adds. About Media Nusantara Headquartered in Jakarta, PT Media Nusantara Citra -- http://www.mnc.co.id/-- is an integrated media company with operations in television broadcasting network, radio and print media. It is the leader in Indonesia's FTA TV broadcasting market, owning 3 FTA TV networks out of a total of 11, and captured the largest audience and ADEX shares in 2005. MNC is 100% owned by PT Bimantara Citra Tbk, which is listed on Jakarta Stock Exchange. The Troubled Company Reporter - Asia Pacific reported on Sept. 19, 2006, that Moody's Investors Service has affirmed its B1 rating for the senior unsecured bonds issued by PT Media Nusantara Citra following the issuance's completion. At the same time, Moody's has affirmed its B1 corporate family rating for MNC. Both ratings have been removed from their provisional status. The ratings outlook is stable. The TCR-AP also reported that Standard & Poor's Ratings Services affirmed its 'B+' rating on senior secured debt of up to US$182 million to be issued by Media Nusantara Citra's wholly-owned subsidiary, Media Nusantara Citra B.V. The notes are unconditionally and irrevocably guaranteed by MNC and some of its subsidiaries, excluding PT Rajawali Citra Televisi Indonesia and PT Cipta Televisi Pendidikan Indonesia. The size of the issue has been reduced from the initial proposed amount of US$230 million as the company delays entering its pay TV business. PAKUWON JATI: Buys IDR88.72-Billion Land From Pakuwon Darma ----------------------------------------------------------- PT Pakuwon Jati Tbk will buy about 451,210 square meter land from PT Pakuwon Darma, Ruters reports. According to the report, the land is priced at IDR190,000 per square meter amounting to a total of IDR85,729,900,000. Pakuwon Jati will buy the land for further development of its integrated real estate complex in Pakuwon City, the report notes. About Pakuwon Jati Headquartered in Surabaya, Indonesia, PT Pakuwon Jati Tbk is a property management company. The company operates the Tunjungan Plaza shopping center, the Mandiri Tower office center, the Sheraton Surabaya Hotel and Towers and the Laguna Indah housing and industrial estate. The Troubled Company Reporter - Asia Pacific reported on Nov. 17, 2006, Moody's Investors Service has affirmed its B2 corporate family rating for PT Pakuwon Jati, Tbk (Pakuwon) and its B2 senior secured rating for Pakuwon Jati Finance BV following the completion of the company's USD110 million bond issuance. At the same time, both ratings have been removed from their provisional status. The bonds are guaranteed by Pakuwon, as well as PT Artisan Wahyu, which will become Pakuwon's subsidiary upon the completion of the acquisition of newly issued shares from AW. The outlook for both ratings is stable. An earlier TCR-AP report on Sept. 5, 2006, stated that Fitch Ratings has assigned long-term foreign currency and local currency Issuer Default Ratings of 'B' to Pakuwon Jati. In addition, Fitch has assigned a National Long-term rating of 'BBB-(idn)' to Pakuwon. The Outlook for the ratings is Stable. Fitch has also assigned an expected rating of 'B' with a Recovery Rating of 'RR4' to the US$120-million senior unsecured notes due 2011 to be issued by Pakuwon Jati Finance B.V. and guaranteed by Pakuwon. The final rating is contingent upon receipt of documents conforming to information already received. PERTAMINA: To Import Additional 200,000 Barrels of Kerosene ----------------------------------------------------------- PT Pertamina (Persero) will import an additional 200,000 barrels of kerosene in July to anticipate a prolonged disruption at its oil refinery in Dumai, which has been out of order for the past two weeks, Antara News reports. According to the report, the refinery's malfunctioned caused a drop of up to 27,500 barrels per day in the production of the two kinds of fuel oil. The report notes that with the additional import, the total volume of kerosene imports in July would reach 900,000 barrels. Djaelani Soetomo, head of Pertamina’s fuel oils division, said that the public need not worry about the possibility of a kerosene scarcity as the existing stock was still sufficient to last over the next 27 days, the report says. The report adds that currently the company had seven oil refineries with a combined production capacity of 1.06 million barrels per day. About PT Pertamina PT Pertamina (Persero) -- http://www.pertamina.com/-- is a wholly state-owned enterprise. The enactment of Oil and Gas Law No. 22/2001 in November 2001 and Government Regulation No.31/2003 has changed its legal status from a special state owned enterprise into a Limited Liability Company. In carrying out its activities, PT Pertamina implements an integrated system from upstream to downstream. Pertamina operates seven oil refineries with a total output capacity of around 1 million barrels per day. However, these refineries only cover about three-quarters of domestic oil demand, the rest is supplied by imports. In 2003, PT Pertamina finance director Alfred Rohimone disclosed that the Company's financial condition was in critical condition because its expenses had surpassed its income due to its obligation to meet domestic demand with fuel oil bought at higher prices on the international market. Mr. Rohimone stated that with a liquidity position below IDR2 trillion, the Company was already bleeding. Despite reporting a net profit of IDR3.03 trillion for the first six months of 2005, Pertamina's failure to service its financial obligations was pegged as one of the contributors to Indonesia's decreased income for the year. In August 2005, Pertamina's debt to United States firm Karaha Bodas Company rose from IDR2.54 trillion to IDR2.99 trillion. The debt had increased when, in 2003, a U.S. court ordered the Company to pay compensation to KBC, relating to an international arbitration decision, when the Indonesian Government halted a geothermal project in Karaha Bodas, East Java. Since that time, the debt has steadily risen due to the Company's failure to pay the compensation immediately. PERUSAHAAN GAS: May Miss July Completion Target Due to Flooding --------------------------------------------------------------- PT Perusahaan Gas Negara may miss a target for the completion of a section in a pipeline project that will transfer gas from the island of Sumatra to Java, Bloomberg News reports. According to the report, Gas Negara may miss its July completion target for the Grissik-Pagardewa segment, to transfer gas from fields operated by ConocoPhillips, because of flooding on parts of the Musi River, which is hampering construction. The report notes that the company is currently “coordinating an intensive evaluation'' on the impact of the possible delay on the overall target completion of the project. Gas Negara is building two pipelines to connect gas-rich South Sumatra with Java. About Perusahaan Gas Headquartered in Jakarta, Indonesia, PT Perusahaan Gas Negara (Persero) Tbk -- http://www.pgn.co.id/-- is a gas and energy company that is comprised of two core businesses: distribution and transmission. For distribution, PGN signs long-term supply agreements with upstream operators, which give the company scheduled and reliable gas volumes and fixed gas prices. These volumes are subsequently sold to commercial and industrial customers under gas sales agreements. Under these agreements, sales volumes are take-or-pay and the gas pricing is fixed and in US dollar. On the transmission business, PGN ships gas on behalf of the upstream suppliers under a fixed US dollar tariff with ship-or-pay volumes agreements. The company is 59.4% owned by the Government of Indonesia. The Troubled Company Reporter - Asia Pacific reported on Jan. 18, 2007, that Moody's Investors Service affirmed the Ba2 corporate family rating of PT Perusahaan Gas Negara (Persero) Tbk. At the same time, Moody's affirmed the Ba3 debt ratings of PGN Euro Finance 2003 Ltd, which is guaranteed by PGN. The ratings outlook is stable. This affirmation followed the recent announcement of a delay in the South Sumatera West Java gas commercialization. The TCR-AP reported on Dec. 21, 2006, that Standard & Poor's Ratings Services revised the outlook on Perusahaan Gas to positive from stable. The ratings on the company are affirmed at 'B+'. On June 28, 2006, the TCR-AP stated that Fitch Ratings Agency assigned these ratings to PT Perusahaan Gas Negara Tbk: -- Long-term foreign currency Issuer Default Rating 'BB-'; -- Long-term local currency IDR 'BB-'; and -- PGN Euro Finance 2003 Limited's IDR1.12-trillion notes due 2014 and IDR1.35-trillion notes due 2013 guaranteed by PGN and its subsidiaries 'BB-'. ========= J A P A N ========= ALITALIA SPA: Air One and Aeroflot Explore Possible Tie-Up ---------------------------------------------------------- OAO Aeroflot is holding talks with Air One chief executive and owner Carlo Toto over a possible alliance to acquire the Italian government's 39.9% stake in Alitalia S.p.A., The Financial Times reports. Sources privy to the matter told the FT that Mr. Toto decided to take a personal lead in holding talks with possible partner and has excluded the carrier's advisors from negotiations. The sources added that though no formal deal has been signed, the two current rivals for Alitalia may fuse their bids. As reported in the TCR-Europe on June 4, 2007, the Italian government wants OAO Aeroflot-Unicredit Italiano S.p.A. and AirOne S.p.A.-Intesa-San Paolo S.p.A. consortia to unify their bids to acquire the state's stake in Alitalia. July 2 Deadline The sources further told FT that neither Air One or Aeroflot give much credence to the government's declaration that it will proceed with its planned auction process culminating on July 2. The sources, however, expects Alitalia to be sold via amicable negotiation between the bidders to avoid a possible collapse of the national carrier. Results Approval The sources told FT that it remains unclear what will happen to Alitalia if auditors Deloitte & Touche refuses to certify its 2006 results or if the current auction process is declared void. TCR-Europe reported om June 5, that Deloitte & Touche may not approve Alitalia's accounts for 2006 pending assurance of the carrier's future. Italian infrastructure minister Antonio Di Pietro earlier said Alitalia may succumb to bankruptcy if bidders do not submit adequate offers to relaunch the ailing carrier. The TCR-Europe reported on May 28, 2007, that Alitalia reported EUR625.6 million in net loss on EUR4.72 billion in operating revenues for the year ended Dec. 31, 2006, compared with EUR176.6 million in net loss on EUR4.8 billion in operating revenues for the year ended Dec. 31, 2005. Parmalat-Type Rescue? The sources further stated that it is unclear whether Italian Industry Minister Pierluigi Bersani will invoke the Marzano Bankruptcy Law to rescue Alitalia from possible collapse. The Marzano Law was passed in 2003 following Parmalat's multi-billion euro collapse in December of the same year. The law allows companies to recover payment made in the year before its insolvency. Bruno Tabacci, a representative of Italy’s UDC party, believe that the government will not be able to use the Marzano law as it may be seen as further state aid by the European Union, FT relates. FT cites a Treasury source as saying that unlike Parmalat, Alitalia’s financial problems are more structural in nature and do not involve fraud or false corporate accounting. About Alitalia Headquartered in Rome, Italy, Alitalia S.p.A. -- http://www.alitalia.it/-- provides air travel services for passengers and air transport of cargo on national, international and inter-continental routes. In Europe, the company reaches 45 airports, with 1,238 flights per week. In the rest of the world, the Alitalia Group's aircrafts operate out of 32 airports with 255 flights per week. The Alitalia Group network is centered on two main airports, Rome Fiumicino and Milan Malpensa, and includes, as of Sept. 30, 2006, an operating fleet of 182 aircrafts. The company also operates in Argentina, China, and Japan. The Italian government owns 49.9% of Alitalia. Despite a EUR1.4 billion state-backed restructuring in 1997, Alitalia posted net losses of EUR256 million and EUR907 million in 2000 and 2001 respectively. Alitalia registered EUR93 million in net profits in 2002 after a EUR1.4 billion capital injection. The carrier booked consecutive annual net losses of EUR520 million in 2003, EUR813 million in 2004, and EUR168 million in 2005. DELPHI CORP: Court Approves US$10.5 Million Umicore Settlement ------------------------------------------------------------ The U.S. Bankruptcy Court for the Southern District of New York gave its stamp of approval to the settlement agreement entered into by Delphi Corp. and its debtor-affiliates with Umicore Autocat Canada Corp. As reported in the Troubled Company Reporter on May 25, 2007, in October 2005, Umicore submitted a demand to the Debtors asserting a reclamation claim for US$2,742,819. In July 2006, Umicore filed Claim No. 12924 against Delphi Automotive Systems, LLC, asserting a US$10,671,101 unsecured non-priority claim and an unliquidated unsecured priority claim for goods and services delivered to DAS. Upon review of their books and records and the supporting documentation provided by Umicore, the Debtors have determined that they only owe Umicore US$10,558,893. After arm's-length bargaining, the Parties arrived at a settlement agreement that provides for the full resolution of Umicore's Claims. Under the Settlement Agreement, the Debtors agree to allow Claim No. 12924 as a prepetition general unsecured non-priority claim for US$10,558,893, without further defense, set-off or reduction. For its part, Umicore agrees to withdraw its Reclamation Demand with prejudice. The Settlement Agreement will avoid costly litigation of Umicore's Claims, John Wm. Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in Chicago, Illinois, tells the Court. The Debtors aver that the Settlement Agreement is in the best interest of their estates and their creditors. About Delphi Corporation Troy, Mich.-based Delphi Corporation (OTC: DPHIQ) -- http://www.delphi.com/-- is the single largest global supplier of vehicle electronics, transportation components, integrated systems and modules, and other electronic technology. The company's technology and products are present in more than 75 million vehicles on the road worldwide. Delphi has regional headquarters in Japan, Brazil and France. The company filed for chapter 11 protection on Oct. 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represents the Official Committee of Unsecured Creditors. As of Mar. 31, 2007, the Debtors' balance sheet showed US$11,446,000,000 in total assets and US$23,851,000,000 in total debts. The Debtors' exclusive plan-filing period expires on July 31, 2007. (Delphi Corporation Bankruptcy News, Issue No. 71; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). DELPHI CORP: Wants to Further Employ Ernst & Young as Auditors -------------------------------------------------------------- Delphi Corp. and its debtor-affiliates ask the United States Bankruptcy Court for the Southern District of New York for authority to employ Ernst & Young LLP as their independent auditors and accounting advisors nunc pro tunc to March 1, 2007, to: (a) perform an audit of their consolidated financial statements and internal control over financial reporting for the year ending December 31, 2007; and (b) provide them with accounting and auditing advisory and research services in connection with various accounting matters. Previous Request to Employ As previously reported, the Debtors obtained the Court's permission to hire Ernst & Young LLP as their independent auditors, accountants, and tax advisors effective nunc pro tunc to January 1, 2006. Since that time, Ernst & Young has performed an audit of the Debtors' financial statements and internal control over financial reporting for the year ending December 31, 2006, John D. Sheehan, Delphi Corp.'s vice president and chief restructuring officer, informs the Court. Fees All services to be provided by Ernst & Young will be screened by Delphi's audit committee to ensure that Ernst & Young complies with the independence standards of applicable rules and regulations, Mr. Sheehan relates. The Debtors will pay Ernst & Young an estimated US$7.2 million domestic fee, plus expenses, for audit services. For additional accounting advisory services, the Debtors will pay Ernst & Young in accordance with the firm's hourly rates: Professional Hourly Rate ------------ ----------- Partner US$550 - US$800 Senior Manager US$425 - US$675 Manager US$330 - US$515 Senior US$250 - US$415 Staff US$135 - US$220 Client Service Associate US$75 - US$140 In accordance its engagement letter with the Debtors, Ernst & Young may subcontract a portion of its responsibilities to its affiliates without the Debtors' prior written approval. E&Y will, however, remain fully and solely responsible for all of its liabilities and obligations under the Engagement Letter, regardless of who performs the duties. Ernst & Young is well-qualified and well-experienced to serve as the Debtors' independent auditors and accountants, Mr. Sheehan tells the Court. E&Y, he points out, is very familiar with the Debtors' accounting, financial control and reporting, and other financial processes. The Debtors aver that Ernst & Young's fees are fair and reasonable in light of industry practice, market rates both inside and outside of Chapter 11 cases, E&Y's experience in reorganizations, and the firm's importance to the bankruptcy cases. Kevin F. Asher, a partner at Ernst & Young LLP, assures the Court that Ernst & Young is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code, and is eligible to be retained under Section 327(a) of the Bankruptcy Code. About Delphi Corporation Troy, Mich.-based Delphi Corporation (OTC: DPHIQ) -- http://www.delphi.com/-- is the single largest global supplier of vehicle electronics, transportation components, integrated systems and modules, and other electronic technology. The company's technology and products are present in more than 75 million vehicles on the road worldwide. Delphi has regional headquarters in Japan, Brazil and France. The company filed for chapter 11 protection on Oct. 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represents the Official Committee of Unsecured Creditors. As of Mar. 31, 2007, the Debtors' balance sheet showed US$11,446,000,000 in total assets and US$23,851,000,000 in total debts. The Debtors' exclusive plan-filing period expires on July 31, 2007. (Delphi Corporation Bankruptcy News, Issue No. 71; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). ITOCHU CORP: To Study Ethanol Producing Plant with Petroleo ----------------------------------------------------------- Itochu Corp. and Petroleo Brasileiro SA will study a plan to build a plant that produces ethanol from sugar cane to gain from increased demand for cleaner-burning fuels, Megumi Yamanaka of Bloomberg News reports. Itochu's spokesman, Naoki Yamanaka revealed to Ms. Yamanaka through a phone interview that Itochu and Petrobas were scheduled to sign an agreement on June 8, 2007. The agreement, according to Mr. Yamanaka, will be used to assess a proposal for a project in Brazil's Pernambuco state, Ms. Yamanka relates. The feasibility will take between a year and 18 months, adds Mr. Yamanaka. Mr. Yamanaka, revealing to Ms. Yamanaka, denied reports that both Itochu and Petroleo will build seven refineries in the northeastern Brazilian state to make 270,000 kiloliters of bio-ethanol a year as reported by the Nikkei newspaper on June 8, 2007. Both Itochu and Petroleo will decide on details of the project only after the feasibility study is completed conveys Ms. Yamanaka. About Itochu Corp Itochu Corporation -- http://www.itochu.co.jp-- is a Japan-based trading company. It operates in eight business segments. The Textile segment offers clothing and interior products, such as wool, synthetic fabrics, silk and others. The Machinery segment is engaged in the automobile, industrial machinery, plants and related businesses. The Space, Information and Multimedia segment is involved in the media network, high technology and related businesses. The Metal and Energy segment is involved in the mining, metal, energy and related businesses. The Living Materials and Chemicals segment is involved in the precision chemistry, rubber, timber, glass, cement and other related businesses. The Food segment is involved in the production, distribution and sale of wheat, rice, corn, frozen food and others. The Financial, Real Estate, Insurance and Logistics segment provides financial consultation, real estate, transportation and other services. The Overseas Corporation segment is involved in various trading activities. The company has operations in Bulgaria, France, Colombia, and Argentina, among others. Fitch Ratings gave Itochu Corp's long-term local credit issuer a BB+ rating on October 2, 2005. Fitch had earlier given the company a BB+ rating for its senior unsecured debt and long-term foreign credit default on March 10, 2004. Moody's Investors Service gave the company a Ba1 rating on its issuer rating and local currency long term debt and an NP on its short term rating on February 7, 2005. Moody's had earlier given the company's senior unsecured debt a Ba1 rating. JVC CORP: Mulls Capital Tieup with Kenwood ------------------------------------------ Victor Co. of Japan, Limited, and Kenwood Corporation are considering forming a capital tieup as part of their efforts to better deal with increasingly fierce competition in the global consumer electronics industry, Kyodo News reveals. According to the report, Kenwood is considering investing in Victor, better known overseas as JVC, by acquiring new shares to be issued by Victor. Kyodo's sources conveyed that Matsushita Electric Industrial Co., which has a 52.4% stake in JVC, entered discussions with audio equipment maker Kenwood after Matsushita's three months of talks with U.S. investment fund Texas Pacific Group Inc. broke down in late May. Matsushita has been rumored to have been wanting to sell its JVC share due to the poor performance of the company, various reports say. JVC and Kenwood are believed to have been seeking to eventually merge their management by setting up a holding company. In that case, Matsushita would likely sell its stake in Victor to the holding company. Sources of Kyodo conveyed that if the partnership materializes, it is likely that realignment within the industry will accelerate. On June 7, 2007, Troubled Company Reporter - Asia Pacific reported that three executives from JVC, opposed to TPG's takeover bid due to its hands-on management style. About JVC Corp. Headquartered in Kanagawa Prefecture, Japan, Victor Company of Japan, Limited (JVC) -- http://www.jvc-victor.co.jp/-- is primarily engaged in the manufacture and sale of audiovisual (AV) equipment, information and communications equipment, electronic products and others. The Company has five business segments. The Consumer Equipment segment offers various types of televisions, digital video cameras, car audio systems, as well as players and related equipment for video, mini disc (MD), compact disc (CD) and digital versatile disc (DVD) systems. The Industrial Equipment provides visual inspection devices, audio and video equipment, as well as projectors. The Electronic Devices segment offers monitors, optical pickups, high density buildups, multilayer boards and display parts. The Software and Media segment provides music and visual software and recording media. The Others segment is engaged in businesses related to interior furniture and production facilities. It has 96 subsidiaries and seven associated companies. Troubled Company Reporter - Asia Pacific reported on June 4, 2007, that JVC reported a net loss of JPY7.9 billion for fiscal year 2006. This is its fourth consecutive annual loss. JVC CORP: Shares Plunge on Kenwood Share Acquisition News --------------------------------------------------------- JVC Corp.’s shares declined on talks that Kenwood Corp. has resumed talks with Matsushita Electric Industrial Co. Ltd. to buy a stake in the company, Reuters states. Shares in JVC, which is officially called Victor Co. of Japan Ltd., dived to a five-year low, falling as much as 14% to JPY426 as the likely deal would involve it issuing new shares to Kenwood, diluting the value of existing JVC stock, ZeeNews.com relates. Reuters cites sources “familiar with the matter” as saying that Kenwood is in talks to buy JPY20 billion (US$165 million) worth of new shares from JVC and then merge with JVC under a holding company. Matsushita would then sell part of its 52.4% stake in JVC to the holding company. Matsushita is aiming to get loss-making JVC off its consolidated accounts, but would likely hold on to some of its shares, Reuters notes. According to press reports, news about Kenwood’s renewed interest to acquire shares in JVC came after a deal between Matsushita and Texas Pacific Group failed. The Troubled Company Reporter – Asia Pacific reported on June 7, 2007, that three top executives of JVC are trying to prevent Texas Pacific from taking a controlling stake in their company. The TCR-AP report, citing MarketWatch, said that the private equity firm had won exclusive rights to negotiate with Matsushita to buy its 52% stake in JVC. However, the talks have dragged on past the March 31 deadline. The Matsushita-Texas Pacific negotiations fell apart after the private equity firm said it wanted JVC to sell off its music production business, and asked Matsushita to continue investing in JVC to bolster JVC's credit, Reuters says, citing sources close to the deal. The report notes that analysts were skeptical that Kenwood would be any more successful than Matsushita to help struggling JVC battle price competition. Kenwood, according to Reuters, posted a 74% drop in net profit in the business year ended March 2007 due to falling audio equipment prices, Kenwood was originally one of the companies interested in JVC before the bidding had been narrowed down to Texas Pacific. About JVC Corp Headquartered in Kanagawa Prefecture, Japan, Victor Company of Japan, Limited (JVC) -- http://www.jvc-victor.co.jp/-- is primarily engaged in the manufacture and sale of audiovisual (AV) equipment, information and communications equipment, electronic products and others. The Company has five business segments. The Consumer Equipment segment offers various types of televisions, digital video cameras, car audio systems, as well as players and related equipment for video, mini disc (MD), compact disc (CD) and digital versatile disc (DVD) systems. The Industrial Equipment provides visual inspection devices, audio and video equipment, as well as projectors. The Electronic Devices segment offers monitors, optical pickups, high density buildups, multilayer boards and display parts. The Software and Media segment provides music and visual software and recording media. The Others segment is engaged in businesses related to interior furniture and production facilities. It has 96 subsidiaries and seven associated companies. Troubled Company Reporter - Asia Pacific reported on June 4, 2007, that JVC reported a net loss of JPY7.9 billion for fiscal year 2006. This is its fourth consecutive annual loss. KRATON POLYMERS: Weak Profitability Cues S&P to Lower Ratings ------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on Kraton Polymers LLC, including the corporate credit and senior secured debt ratings to 'B' from 'B+'. The outlook is negative. The downgrade follows weakened profitability primarily because of higher than expected raw material cost inflation that has resulted in the deterioration of key measures of credit quality. "While we expect management to raise prices in order to offset some of the raw material pressure, Kraton's cash flow generation is likely to remain weaker than initially expected during the next few quarters, limiting the company's ability to improve its highly leveraged financial profile back toward the level appropriate for the previous ratings," said Standard & Poor's credit analyst David Bird. The ratings on Kraton reflect its weak business risk profile derived from its narrow focus on the styrenic block copolymers market and a highly leveraged financial profile. Houston, Texas-based Kraton is a leading producer of SBCs with about US$1 billion in annual sales and approximately US$631 million of debt outstanding, including a modest amount of capitalized operating leases and unfunded postretirement obligations. The company produces unhydrogenated SBCs, hydrogenated SBCs,polyisoprene rubber, polyisoprene latex, and SBC-based compounded materials. SBCs offer flexibility, resilience, strength, and durability to a wide range of products in a number of end-use markets, including (1) adhesive, sealants, and coatings, (2) paving and roofing, (3) compounding channels, (4) packaging and films, and (5) personal care. The SBC market is part of the larger thermoplastic elastomers industry, with a market size of approximately US$3 billion and an expected future growth rate of about 6% per year. Between the two product types, faster growth is expected in HSBCs, which are used in a variety of applications such as personal hygiene and soft-grip handles. USBC growth is typically slower and is focused on mature end markets such as asphalt modification and adhesives. The company has development centers in Belgium, Brazil and Japan. ========= K O R E A ========= BIOMET INC: Private Equity Consortium Ups Offer to US$11.4 Bil. --------------------------------------------------------------- Biomet Inc.'s Board of Directors has unanimously recommended to shareholders an increased offer from a private equity consortium to acquire Biomet for US$46.00 per share in cash, or an equity value of US$11.4 billion. Under the terms of the revised merger agreement, the consortium -– which includes affiliates of the Blackstone Group, Goldman Sachs Capital Partners, Kohlberg Kravis Roberts & Co. and TPG -– will commence a tender offer on or before June 14, 2007, to acquire all of the outstanding shares of Biomet’s common stock. Following completion of the tender offer, the consortium will complete a second-step merger in which any remaining common shares of Biomet will be converted into the right to receive the same per share price paid in the tender offer. The US$46.00 per share offer price represents a premium of 32.3% over the closing price of Biomet’s common stock on April 3, 2006, the trading day prior to public speculation that the company was exploring strategic alternatives. Biomet subsequently confirmed on April 6, 2006 that it had retained Morgan Stanley to assist it in exploring strategic alternatives. Morgan Stanley's Opinion Morgan Stanley has provided the Board of Directors with its opinion that, as of June 6, 2007 and subject to qualifications and assumptions, the consideration to be received pursuant to the revised merger agreement is fair from a financial point of view to holders of Biomet common stock. "We believe the proposed price for the transaction is fair to Biomet’s shareholders. We also believe that the investor group’s tender offer will deliver superior value to Biomet’s shareholders in a more efficient and more immediate fashion than the process provided by the original merger agreement. Moreover, this revised offer provides greater certainty and visibility to completion of the transaction," said Niles L. Noblitt, Chairman of the Board. In a statement, the sponsor group said: "Our offer empowers current shareholders who have an economic interest in Biomet common shares to realize significant value in a timely manner and represents the absolute limit of our ability to structure an appropriate buyout of Biomet. We are pleased that the consortium will be in a position to provide the company with financial and operational resources to support its future growth." Completion of the tender offer is subject to the condition that at least 75% of the Biomet common shares have been tendered in the offer – the same percentage approval requirement as with the previous merger structure. The amended merger agreement permits the investor group to revise the condition regarding minimum acceptance of the tender offer to decrease the minimum acceptance threshold to a number that, together with shares whose holders have agreed to vote to approve the second-step merger, represents at least 75% of the Biomet common shares. The tender offer will expire at midnight, New York time, on the 20th business day following and including the commencement date, unless extended in accordance with the terms of the offer and the applicable rules and regulations of the Securities and Exchange Commission. The tender offer and subsequent merger are subject to customary conditions for transactions of this type. Morgan Stanley & Co. Incorporated is acting as financial advisor to the Board of Biomet, Inc. and to Biomet, Inc. Kirkland & Ellis LLP is legal counsel to Biomet, Inc. and Simpson Thacher & Bartlett LLP is legal counsel to the independent directors of the Board of Biomet, Inc. Banc of America Securities LLC is acting as lead M&A advisor and Goldman, Sachs & Co. is acting as M&A advisor to the private equity consortium. Cleary Gottlieb Steen & Hamilton LLP is acting as legal advisor to the private equity consortium. Shareholders' Meeting Deferred As a result of the revised merger agreement and tender offer, Biomet has cancelled the special meeting of shareholders previously scheduled last Friday, June 8, 2007 to consider and vote on the original merger agreement announced on December 18, 2006, and related transactions. Furthermore, as part of the revised merger agreement, Biomet has agreed not to pay its annual dividend. About The Blackstone Group The Blackstone Group -- http://www.blackstone.com-- is a global alternative asset manager and provider of financial advisory services. About Goldman Sachs Capital Partners Founded in 1869, Goldman Sachs is one of the oldest and largest investment banking firms. Goldman Sachs is also a global private corporate equity and mezzanine investing company. Established in 1991, the GS Capital Partners Funds are part of the firm’s Principal Investment Area in the Merchant Banking Division, which has formed 13 investment vehicles aggregating US$56 billion of capital to date. About Kohlberg Kravis Roberts & Co. Kohlberg Kravis Roberts & Co. (KKR) is one of the world’s oldest and most experienced private equity firms specializing in management buyouts. Founded in 1976, it has offices in New York, Menlo Park, London, Paris, Hong Kong, and Tokyo. About TPG TPG -- http://www.tpg.com-- is a private investment partnership that was founded in 1992 and currently has more than US$30 billion under management. The firm has offices in San Francisco, London, Hong Kong, Fort Worth and other locations globally. About Biomet Biomet Inc. and its subsidiaries design, manufacture, and market products used primarily by musculoskeletal medical specialists in both surgical and non-surgical therapy. Headquartered in Warsaw, Indiana, Biomet and its subsidiaries currently distribute products in more than 100 countries, including the Netherlands, Argentina and Korea. BIOMET INC: Regains Nasdaq Listing Compliance --------------------------------------------- Biomet Inc. disclosed that it received a letter from the Nasdaq Listing Qualifications Panel stating that Biomet has evidenced compliance with the Panel’s prior decisions and all applicable Nasdaq Marketplace Rules, and that the Panel has determined to continue the listing of Biomet’s common shares on the NASDAQ Global Select Market. Biomet Inc. and its subsidiaries design, manufacture, and market products used primarily by musculoskeletal medical specialists in both surgical and non-surgical therapy. Headquartered in Warsaw, Indiana, Biomet and its subsidiaries currently distribute products in more than 100 countries, including the Netherlands, Argentina and Korea. BIOMET INC: Moody's May Downgrade All Ratings After Review ---------------------------------------------------------- Moody's Investors Service placed all of the provisional ratings of Biomet, Inc. under review for possible downgrade following the announcement that a private equity consortium has increased the price of its offer to purchase the company to US$11.4 billion from about US$10.9 billion. Moody's rating review will consider: (1) how the company and its sponsors plan to fund the additional US$500 million in purchase price; (2) implications for de-leveraging and credit measures; and (3) any changes to liquidity. "Our initial ratings and negative outlook already considered extraordinarily high debt levels and the need to focus on de-leveraging," Diana Lee, a Senior Credit Officer at Moody's said. "Assuming this new price is funded with additional debt, the ratings may not hold." Ratings placed under review for possible downgrade: * Biomet, Inc. -- Corporate family rating at (P)B2; -- Asset backed revolver at (P)Ba2, (LGD2, 14%); -- Secured cash draw revolver at (P)B1, (LGD3, 36%); -- Secured term loan at (P)B1, (LGD3, 36%); -- Unsecured senior notes at (P)B3, (LGD4, 63%); -- Unsecured PIK option notes at (P)B3, (LGD4, 63%); -- Unsecured subordinated notes at (P)Caa1, (LGD6, 93%); -- PDR at B2; -- SGL-2. Biomet Inc. and its subsidiaries design, manufacture, and market products used primarily by musculoskeletal medical specialists in both surgical and non-surgical therapy. Headquartered in Warsaw, Indiana, Biomet and its subsidiaries currently distribute products in more than 100 countries, including the Netherlands, Argentina and Korea. BHK INC: Signs Statutory Merger With NewheartBio Co. ---------------------------------------------------- BHK Inc. has signed a statutory merger agreement with NewheartBio Co., Ltd., to diversify its businesses and create higher benefit from the consolidation, Reuters reports. According to the report, the exchange ratio of BHK and NewheartBio is 1 : 0.602116, based on the market value of KRW2,835 and KRW1,707 respectively. NewheartBio's capital is KRW2,304 million. The merger effective date is August 27, 2007, the report relates. About BHK Inc. Seoul, Korea-based BHK Inc. is engaged in international trading. The company's products consist of liquid crystal display televisions (LCD-TV's), electronic products, bed sheets, pillows, pillowcases, curtains and clothing. The company sells its bedding products in the department stores under the brand name Pierre Cardin. Currently, the company is also in the development stage for launching of a new business segment, which specializes in biomedical products, namely MyoCell, for heart muscle regeneration. The Troubled Company Reporter - Asia Pacific reported on March 2, 2007, that the company has a shareholders' equity deficit of US$17.38 million on total assets of US$24.36 million. DM TECHNOLOGY: Converts Second Convertible Bonds Into Shares ------------------------------------------------------------ DM Technology Co., Ltd., converted its second convertible bonds into shares, Reuters reports. The report relates that the bonds conversion price is KRW3,775 per share. This brings the total outstanding shares of the Company to 8,234,212. The confirmed listing date is June 13, 2007, the report adds. About DM Technology Based in Gyeonggi Province, South Korea, DM Technology Co., Ltd. -- http://www.dmtechnology.co.kr/eng/index.asp-- is engaged in the manufacturing of digital home appliances. The company mainly provides crystal display (LCD) televisions (TVs), portable multimedia players and home theater systems, including digital versatile disc (DVD) receivers, DVD players and other systems. It has an overseas corporation each in China, Hong Kong, Japan, the United Kingdom and Netherlands. Korea Ratings gave the company’s convertible bond with an August 8, 2008 maturity date an initial rating of B, with stable out look on August 16, 2006. EVEREX INC: Appoints Park Chan as New Chief Executive Officer ------------------------------------------------------------- Everex Inc. appointed Park Jong Chan as chief executive officer of the Company, Reuters reports. According to the report, the appointment is effective June 7, 2007. About Everex Inc. Based in Gyeonggi Province, Korea-based Everex Inc. is engaged in the manufacturing of semiconductor manufacturing equipment and parts. The company provides four main products: track systems, which are designed to coat and develop photoresist patterns in wafers; degas systems, which prevents uneven photoresist dispensing; track modify systems, which are used to configure ultraviolet processing, and other devices, including module testers, impedance systems and chip testers. The Troubled Company Reporter - Asia Pacific reported on March 2, 2007, that Everex Inc. has a shareholders' deficit of US$5.10 million on assets of US$23.15 million. TOWER AUTOMOTIVE: Inks Asset Purchase Pact with TA Acquisition -------------------------------------------------------------- Tower Automotive Inc. and its debtor-affiliates told the United States Bankruptcy Court for the Southern District of New York that after prolonged arm's-length negotiations, it executed an asset purchase agreement on May 1, 2007, with TA Acquisition Company, LLC, an affiliate of Cerberus Capital Management L.P., subject to higher and better offers at the June 25, 2007 auction. As previously reported, the Debtors agreed in principle to sell substantially all of their assets to Cerberus Capital for roughly US$1 billion subject to higher and better offers, Anup Sathy, Esq., at Kirkland & Ellis LLP, in Chicago, Illinois, relates. The salient terms of the APA are: Seller: Tower Automotive, Inc. and it debtor-affiliate signatories Purchaser: TA Acquisition Company, LLC Acquired Assets: (a) all property and assets of the Seller including, but not limited to all property; all assets; all cash and cash equivalents; all accounts and intercompany receivables; and all claims against Foreign Entities; (b) to the extent they relate to any Acquired Asset, Assumed Contract, Assumed Liability or any claim or allegation that TA Acquisition is liable or responsible for a Liability of the Debtors, whether or not TA Acquisition has assumed the Liability -- claims, credits, security or other deposits, including recoverable deposits, prepayments, prepaid assets, prepaid expenses, prepaid rent, deferred charges, refunds or claims for refunds, causes of action, defenses, counter- claims, cross- claims, third party claims, rights of recovery, rights of set-off and rights of recoupment, insurance proceeds and all rights under historical or current insurance policies of any member of the Tower Group, and, in each case, security interests, as applicable, as of the Closing Date; (c) all the assets reflected on the Debtors' Balance Sheet provided the assets have not been disposed of by the Tower Group in the ordinary course of business or pursuant to a Court ruling after the Balance Sheet Date; and (d) all trusts, insurance contracts, accounts and funding arrangements relating to any Assumed Plans. Excluded Assets: (a) All rights of any seller pursuant to the APA and the Ancillary Agreements; (b) The Chapter 5 Claims set forth in the APA, and claims in respect of Excluded Assets and claims directly related to Excluded Liabilities which are not Liabilities to customers, suppliers or other business relations with whom TA Acquisition does business after the Closing and which are identified to TA Acquisition in advance of any action being taken to collect on the claims and as to which TA Acquisition does not object to the claim being asserted in its reasonable discretion; (c) Any asset or contract which TA Acquisition identifies in writing to the Debtors before June 22, 2007, provided that the exclusion of any asset or contract will not reduce or otherwise affect the amount of the Purchase Price; (d) Any non-material asset or contract which TA Acquisition identifies in writing to the Debtors from June 23, 2007, until at least 10 business days before the Closing. For avoidance of doubt, the exclusion of any asset or contract will not reduce or otherwise affect the amount of the Purchase Price; (e) Any equity interests in any of the Debtors; (f) Any Foreign Entity identified on the APA or as determined by TA Acquisition; (g) The assets identified on the APA; and (h) All beneficial tax attributes to the extent not transferable by applicable law and the Debtors' U.S. federal net operating loss carry-forwards. Assumed Contracts: The Debtors' Collective Bargaining Agreements identified on the APA, the Change in Control Agreements, the KERP Agreements and any other contract set forth in the APA. Assumed Liabilities: * All Working Capital Obligations; * All benefit obligations pursuant to the Consolidated Pension Plan and the other Assumed Plans; * All contingent Liabilities payable pursuant to the terms of the Change in Control Agreements; * The KERP Liability; * All Liabilities pursuant to Assumed Contracts arising after the Closing. For avoidance of doubt, the obligations will not include any amounts necessary to satisfy the Cure Amounts pursuant to Section 365 of the Bankruptcy Code in connection with the assignment and assumption of the Assumed Contracts; * All statutory environmental Liabilities which (1) arise under Environmental Laws, (2) are associated with real property acquired by TA Acquisition or its affiliates, (3) are enforced by a Governmental Entity, and (4) are not "claims" as defined in Section 101(5) of the Bankruptcy Code; * The current balance due with respect to the Marsh Financing, provided all benefits of the insurance policies are received by or are available to TAC Acquisition, as contemplated in the definition of Acquired Assets; * If no amount is paid by TA Acquisition for the IRB Payment pursuant to the APA, all the Debtors' Liabilities pursuant to the Industrial Revenue Bonds; and * The Retiree Benefit Settlements, prepetition and postpetition worker compensation claims, and the Assumed Liabilities will not include any amounts included in the categories constituting Capped Payments. Purchase Price: The sum of the DIP Payment, Second Lien Payment, the IRB Payment, the Unsecureds Claim Payment, Unsecureds Funds Payment, the Allowed Secured Claims Payment, the Allowed Administrative Claims Payment, the Allowed Priority Claims Payment, the Cure Amounts Payment, the Indemnification Payment, the Tail Payment and the Escrow Fee Payment. Deposit: TA Acquisition deposited with the Escrow Agent, pursuant to the terms of the Escrow Agreement, US$25,000,000 by wire transfer of immediately available funds, which deposit will be held and released in accordance with the provisions of the Escrow Agreement and the other provisions contained in the APA. Provided that the transactions contemplated in the APA are consummated, the Deposit will be paid to the DIP Lenders at the Closing as more fully set forth in the APA. Closing: The consummation of the transactions contemplated by the APA will take place at the Closing to be held at the offices of Kirkland & Ellis LLP, 153 East 53rd Street, in New York, at 9:00 a.m., E.S.T., on July 31, 2007, or if mutually agreed upon in writing by the Debtors and TA Acquisition the second business day after, but not including, the date on which the last of the conditions set forth in the APA are satisfied or waived, other than those conditions that by their nature are to be satisfied at the Closing. Mr. Sathy further notes that the APA contains items, which may be considered Extraordinary Provisions under the Guidelines for the Conduct of Asset Sales: -- The proposed form of the Court ruling contains certain findings with respect to the Acquired Assets being free of successor liability. TAC Acquisition has requested the findings as part of its offer for the Acquired Assets; -- The proposed form of the Court ruling requests a waiver from any stamp taxes and other applicable transfer taxes in connection with the sale and transfer of the Acquired Assets; and -- The proposed form of the Court ruling contains a waiver of the stays imposed by Rules 6004(g) and 6006(d) of the Federal Rules of Bankruptcy Procedure. Against this backdrop, the Debtors ask the Court to: (a) approve the APA between the Debtors and TA Acquisition, or other forms of purchase agreements between the Debtors and the Successful Bidder, as defined in the Marketing Protocol Order; (b) authorize the closing of the sale of the Acquired Assets to TA Acquisition, or the Successful Bidder, free and clear of all claims and interests, other than permitted encumbrances and assumed liabilities; and (c) authorize their assumption of the Assumed Contracts, and the assignment of the Assumed Contracts to TA Acquisition or the Successful Bidder. According to Mr. Sathy, contemporaneously with the filing of the request, the Debtors have sought approval of cure and notice procedures for the assumption and assignment of executory contracts and unexpired leases. The Cure Procedures Motion proposes a process by which the Debtors can establish the cure amounts for the Assumed Contracts, and otherwise comply with the requirements of Section 365 of the Bankruptcy Code. A preliminary list of the Assumed Contracts with projected cure amounts is available for free at: http://bankrupt.com/misc/Tower63Assumed The list remains subject to further review by the Debtors and TA Acquisition, and may be amended to add or remove certain Assumed Contracts, Mr. Sathy tells the Court. The sale and transfer of the Acquired Assets and Assumed Contracts is necessary to the confirmation and the consummation of the Debtors' Chapter 11 Plan, Mr. Sathy asserts. The value to be realized from the sale of the Acquired Assets is the centerpiece of the Debtors' strategy to emerge from Chapter 11. Unless objections to the request are received no later than 4:00 p.m. (EDT) on July 6, 2007, the Court may grant the request without hearing. A full-text copy of the executed version of the APA between the Debtors and TA Acquisition is available for free at: http://bankrupt.com/misc/Tower63AssetPurchaseAgreement.pdf About Tower Automotive Headquartered in Grand Rapids, Michigan, Tower Automotive Inc. -- http://www.towerautomotive.com/-- is a global designer and producer of vehicle structural components and assemblies used by every major automotive original equipment manufacturer, including BMW, DaimlerChrysler, Fiat, Ford, GM, Honda, Hyundai/Kia, Nissan, Toyota, Volkswagen and Volvo. Products include body structures and assemblies, lower vehicle frames and structures, chassis modules and systems, and suspension components. The company has operations in Korea, Spain and Brazil. The company and 25 of its debtor-affiliates filed voluntary chapter 11 petitions on Feb. 2, 2005 (Bankr. S.D.N.Y. Case No. 05-10576 through 05-10601). James H.M. Sprayregen, Esq., Ryan B. Bennett, Esq., Anup Sathy, Esq., Jason D. Horwitz, Esq., and Ross M. Kwasteniet, Esq., at Kirkland & Ellis, LLP, represent the Debtors in their restructuring efforts. Ira S. Dizengoff, Esq., at Akin Gump Strauss Hauer & Feld LLP, represents the Official Committee of Unsecured Creditors. When the Debtors filed for protection from their creditors, they listed $787,948,000 in total assets and US$1,306,949,000 in total debts. On May 1, 2007, the Debtors filed their Chapter 11 Plan of reorganization and Disclosure Statement explaining that plan. On June 4, 2007, the Debtors submitted an Amended Plan and Disclosure Statement. The Court approved the adequacy if the Amended Disclosure Statement on June 5, 2007. The hearing to consider confirmation of the Debtors' Amended Plan is set for July 11, 2007. (Tower Automotive Bankruptcy News, Issue No. 63; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) TOWER AUTOMOTIVE: Lexington Wants Adequate Assurance on Lease ------------------------------------------------------------- Lexington Lion Plymouth LP tells the U.S. Bankruptcy Court for the Southern District of New York that it leases to Tower Automotive, Inc. the premises located at 43955 Plymouth Oaks Boulevard in Plymouth, Michigan, one of the assets to be transferred to TA Acquisitions Company, LLC. Harvey A. Strickson, Esq., at Paul, Hastings, Janofsky, & Walker LLP, in New York, contends that before the Court may approve the assignment of the lease, TAPC must assume it and "provide adequate assurance of future performance by the assignee to Lexington." To date, Lexington has not been provided with any financial statement despite having made a request to the Debtors' counsel, Mr. Strickson says. About Tower Automotive Headquartered in Grand Rapids, Michigan, Tower Automotive Inc. -- http://www.towerautomotive.com/-- is a global designer and producer of vehicle structural components and assemblies used by every major automotive original equipment manufacturer, including BMW, DaimlerChrysler, Fiat, Ford, GM, Honda, Hyundai/Kia, Nissan, Toyota, Volkswagen and Volvo. Products include body structures and assemblies, lower vehicle frames and structures, chassis modules and systems, and suspension components. The company has operations in Korea, Spain and Brazil. The company and 25 of its debtor-affiliates filed voluntary chapter 11 petitions on Feb. 2, 2005 (Bankr. S.D.N.Y. Case No. 05-10576 through 05-10601). James H.M. Sprayregen, Esq., Ryan B. Bennett, Esq., Anup Sathy, Esq., Jason D. Horwitz, Esq., and Ross M. Kwasteniet, Esq., at Kirkland & Ellis, LLP, represent the Debtors in their restructuring efforts. Ira S. Dizengoff, Esq., at Akin Gump Strauss Hauer & Feld LLP, represents the Official Committee of Unsecured Creditors. When the Debtors filed for protection from their creditors, they listed $787,948,000 in total assets and US$1,306,949,000 in total debts. On May 1, 2007, the Debtors filed their Chapter 11 Plan of reorganization and Disclosure Statement explaining that plan. On June 4, 2007, the Debtors submitted an Amended Plan and Disclosure Statement. The Court approved the adequacy if the Amended Disclosure Statement on June 5, 2007. The hearing to consider confirmation of the Debtors' Amended Plan is set for July 11, 2007. (Tower Automotive Bankruptcy News, Issue No. 64; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) =============== M A L A Y S I A =============== AMSTEEL CORP: Bursa Denies Further Plan Filing Extension -------------------------------------------------------- The Bursa Malaysia Securities Bhd denied Amsteel Corp Bhd's request for further extension of the deadline within which the company is required to file its regularization plan. The bourse had earlier granted the company until July 31, 2007, to submit its plan to the Securities Commission and other relevant authorities for approval. According to AmInvestment Bank Berhad, acting as Amsteel Corp.'s merchant bank, the Bursa Securities was not able to consider the application as its earlier extension is final. The bourse also decided that if the company fails to comply with the extended timeframe, a delisting procedure will be commenced against the company's securities. Headquartered in Kuala Lumpur, Malaysia, Amsteel Corporation Berhad is involved in the provision of plantation management, property development, management and contractor; hotel operation and food court. The Company is also involved in transportation and logistic services, department stores, nominee services, trading securities, manufacture and sale of tools, dies, tyres, rubber compound, light trucks and buses, financial management; distributes steel products, develops real estate property; cultivation of rubber and oil palm, golf and country club, sale and distribute Suzuki motorcycles, beer brewing and mineral water bottling. As reported in the Troubled Company Reporter - Asia Pacific on May 19, 2006, Amsteel Corporation Berhad was classified under Bursa Malaysia Securities Berhad's Amended Practice Note 17 category. The Company was identified as an affected listed issuer because: -- the auditors have expressed a modified opinion with emphasis on the Company's going concern in the Company's latest audited financial statement for the financial year ended June 30, 2005; and -- the Company's consolidated shareholders' equity as of June 30, 2005, represented 17.3% of the issued and paid-up capital of the Company. Pursuant to the PN17 classification, the Company is required to submit and implement a plan to regularize its financial condition. DAY INTERNATIONAL: Completes Sale to Flint Group ------------------------------------------------ The acquisition of Day International Group Inc. by Flint Group was completed on May 31, 2007. Day International will operate as a business unit of Flint Group. Dennis Wolters, CEO of Day International will remain in that role within the new organization. In the combined organization, nearly 8300 employees will serve customers from 170 sales, service and manufacturing locations on five continents. Revenues for 2007 are estimated to be EUR2.55 billion ($3.32 billion). About Flint Group Flint Group -- http://www.flintgrp.com/-- is dedicated to serving the global printing, converting, and colourant industries. Flint Group companies develop, produce and market a wide range of conventional and UV printing inks on a global basis, with regional operations that provide local service throughout Europe, North America, Latin America, Asia, and India/Pacific. Other companies in the group include Flint Group Printing Plates, specialising in photopolymer printing plates, and XSYS Print Solutions, specialising in narrow web inks. Flint Group Pigments produces a range of pigment products and additives for use in inks and other colourant applications. Headquartered in Luxembourg, Flint Group operates more than 140 facilities worldwide, and employs some 7,000 people. About Day International Founded in 1905 in Dayton, Ohio, Day International Group Inc. -- http://www.dayintl.com/-- operates production, sales, and distribution centers in North America, Latin America, Europe and Asia Pacific. Product lines include dayGraphica(R) printing blankets and sleeves, david M(R) printing blankets, , Duco(TM) printing blankets, Sun Graphic printing blankets, IPT(TM) printing blankets, Varn(TM) pressroom chemicals, Rotec(R) flexographic sleeve systems, dayCorr(R) diecutting blankets and day-Flo(R) pre-inked rolls. The company has locations in Mexico, Germany, and Malaysia. DAY INT’L: Flint Buyout Completion Cues S&P to Withdraw Ratings --------------------------------------------------------------- Standard & Poor's Ratings Services withdrew its ratings on Dayton, Ohio-based Day International Group Inc. The withdrawal follows the acquisition of the company by Flint Group. As reported in the Troubled Company Reporter on April 16, 2007, S&P placed the company's 'B' corporate credit rating on CreditWatch with developing implications. Founded in 1905 in Dayton, Ohio, Day International Group Inc. -- http://www.dayintl.com/-- operates production, sales, and distribution centers in North America, Latin America, Europe and Asia Pacific. Product lines include dayGraphica(R) printing blankets and sleeves, david M(R) printing blankets, , Duco(TM) printing blankets, Sun Graphic printing blankets, IPT(TM) printing blankets, Varn(TM) pressroom chemicals, Rotec(R) flexographic sleeve systems, dayCorr(R) diecutting blankets and day-Flo(R) pre-inked rolls. The company has locations in Mexico, Germany, and Malaysia. HALIFAX CAPITAL: Bursa Starts Delisting Procedures -------------------------------------------------- The Bursa Malaysia Securities Bhd has commenced delisting procedures against Halifax Capital Berhad, an Amended Practice Note No. 17/2005 company, after it failed to comply with the extended timeframe to submit its regularization plan to the Securities Commission and other relevant authorities for approval by June 6, 2007. According to the bourse, the company has been served with a notice by Bursa Securities on June 8, 2007, to make representations to Bursa Securities, within a period of five market days from the date of the receipt of the notice, as to why their securities should not be delisted from the Official List. Due process is therefore accorded to the company prior to making a decision on whether to delist its securities. The Bursa Securities also decided to suspend the trading of the company's securities on June 14, 2007. Headquartered in Kuala Lumpur, Malaysia, Halifax Capital Berhad –- fka Setron (Malaysia) Berhad -- is principally engaged investment holding, and assembly and sale of electrical and electronic products. Setron Sales & Service (M) Sdn. Bhd., the Company's wholly owned subsidiary, is engaged in the distribution of electrical and electronic products. The company is considered an affected listed issuer under the Bursa Malaysia Securities Berhad's Practice Note 17 category because its shareholders' equity on consolidated basis is less than 25% of the issued and paid-up share capital. HARVEST COURT: Unit Sells Land Assets for MYR1.7 Million -------------------------------------------------------- Harvest Court Properties Sdn. Bhd, a wholly owned subsidiary of Harvest Court Industries Berhad, entered into a conditional Sale and Purchase Agreement with Cara Anggun Development Sdn. Bhd to dispose all land held under Geran No. 89149 for a total cash consideration of MYR1,700,000.00 The total cash consideration of the Property was arrived at on a willing buyer-willing seller basis after taking into the consideration the indicative market value of the Property of MYR1,400,000.00 by Khong & Jaafar Sdn Bhd. There are no other liabilities to be assumed by the Purchasers from the Proposed Disposal. According to the company, the purchase agreement was inked to dispose its loss making property development project including the Proposed Disposal as part of its plan to exit from the property development business. The proceeds from the Proposed Disposal will be used to repay the Chargee to reduce the level of the bank borrowings of the HCIB Group and expenses in relation to the Disposal. Headquartered in Selangor, Malaysia, Harvest Court Industries Berhad -- http://www.harvestcourt.com/-- is engaged in kiln drying, saw milling and manufacturing of timber doors and related products. Other activities include development of residential and commercial properties and jetty services and provision of construction works and related maintenance services. The Group is also involved in the provision of marketing and management services and investment in shares and securities. The Group operates in Malaysia and Australia. The Group has defaulted on several loan facilities because of a reduction in sales from 2002 onwards due to a weak global market as a result of the Iraqi and the severe acute respiratory syndrome, or SARS, as well as its inability to raise funds via the equity market due to weak market sentiment. Due to its financial position, Harvest Court had embarked on an exercise to restructure the Company, including a debt restructuring and capital reduction. The Company's proposed corporate exercise was rejected by the Securities Commission in November 2005, on grounds that the proposals are not comprehensive and are not capable of resolving all financial problems of the Company. Its appeal to reconsider the rejection was also junked by the Commission on February 24, 2006. Currently, the company is classified under the Amended PN17 category of the Bursa Malaysia Securities Bhd's official list and is therefore required to implement a plan to regularize its finances. Harvest Court Industries Bhd's unaudited balance sheet as at Dec. 31, 2006, went upside down with total assets of MYR36.59 million and total liabilities of MYR50.17 million, resulting to a shareholders' deficit of MYR13.58 million. SMART MODULAR: Ezra Perlman Resigns as Director ----------------------------------------------- SMART Modular Technologies (WWH), Inc., disclosed that Ezra Perlman’s resignation as a director became effective June 5, 2007. Mr. Perlman’s resignation was consistent with the company's need to increase the number of independent directors as it is no longer a controlled company and was not related to any disagreement with the company regarding its operations, policies or practices. The company also announced that the Board of Directors, upon the recommendation of its Nominating and Corporate Governance Committee, appointed D. Scott Mercer as a director, effective June 5, 2007, to fill the vacancy created by Mr. Perlman’s resignation. Mr. Mercer also has been appointed to serve on the Audit Committee. There are no arrangements or understandings between Mr. Mercer and the company or any other persons pursuant to which he was appointed as a director. There are no transactions or proposed transactions to which the company was or is a party in which Mr. Mercer has a direct or indirect material interest. Mr. Mercer will be compensated as a director pursuant to the company’s compensation policy for non-employee independent directors. About SMART Modular SMART Modular Technologies (WWH) Inc. (Nasdaq: SMOD) -- http://www.smartm.com/--designs, manufactures and supplies electronic subsystems to original equipment manufacturers, or OEMs. SMART offers more than 500 standard and custom products to OEMs engaged in the computer, industrial, networking, gaming, telecommunications, and embedded application markets. The company has design centers in California, South Korea and Massachusetts. Its manufacturing facilities are located in California, Malaysia, Brazil, Dominican Republic and Puerto Rico. * * * Moody's Investors Service assigned a B2 rating to SMART Modular Technologies (WWH) Inc.'s US$125 million senior secured second lien notes due 2012 issued under Rule 144A. Standard & Poor's Ratings Services assigned its B+ corporate credit rating to Fremont, California-based SMART Modular Technologies (WWH) Inc. ==================== N E W Z E A L A N D ==================== CREATIVE EDUCATION: Court to Hear Wind-Up Petition on June 28 ------------------------------------------------------------- The High Court of Auckland will hear a petition to wind up the operations of Creative Education and ESL Learning Centre Ltd. on June 28, 2007, at 10:45 a.m. The petition was filed by the Commissioner of Inland Revenue on April 11, 2007. The CIR's solicitor is: Kay S. Morgan c/o Inland Revenue Department 1 Bryce Street, Hamilton New Zealand GYM TRADING: Enters Wind-Up Proceedings --------------------------------------- During a meeting held on June 1, 2007, the shareholders of Gym Trading Ltd. agreed to wind up the company's operations and appointed John Michael Gilbert as liquidator. The Liquidator can be reached at: John Michael Gilbert c/o C & C Strategic Limited Ponsonby, Auckland New Zealand Telephone:(09) 376 7506 Facsimile:(09) 376 6441 INDUSTRIAL BELTS: Fixes July 2 as Deadline to Prove Claims ---------------------------------------------------------- The shareholders of Industrial Belts Ltd. met on June 1, 2007, and agreed to wind up the company's operations. Laurence George Chilcott and Peter Charles Chatfield, the appointed liquidators, fixed July 2, 2007, as the last day for creditors to prove their claims. The Liquidators can be reached at: Laurence George Chilcott Peter Charles Chatfield Smith Chilcott Bertelsen Harry Chartered Accountants Shortland Tower One, Level 11 51-53 Shortland Street PO Box 5545, Auckland New Zealand Telephone:(09) 379 8035 Facsimile:(09) 307 8892 QUADRANT CORPORATION: Faces APN Holdings' Wind-Up Petition ---------------------------------------------------------- APN Holdings Limited filed a petition to wind up the operations of Quadrant Corporation (NZ) Ltd. on April 19, 2007. The petition will be heard before the High Court of Auckland on July 26, 2007, at 10:00 a.m. The solicitor of APN Holdings is: M. J. Robinson c/o Turner Hopkins 400 Lake Road PO Box 33237, Takapuna Auckland, New Zealand Telephone:(09) 486 2169 Facsimile:(09) 486 2160 SIMPSONS FARMS: Appoints Michael Crawford as Liquidator ------------------------------------------------------ The shareholders of Simpsons Farms 2007 Ltd. met on May 21, 2007, and resolved to liquidate the company's business. Michael Crawford of Deloitte was appointed as liquidator. The Liquidator can be reached at: Michael Crawford PO Box 17, Hamilton New Zealand Telephone:(07) 838 4800 Facsimile:(07) 838 4810 SNOW SUMMIT: Names Peter James Heenan as Liquidator ---------------------------------------------------- On April 1, 2007, Snow Summit Ltd. entered liquidation proceedings due to the company's inability to pay its debts. Peter James Heenan was appointed as liquidator. The Liquidator can be reached at: Peter James Heenan c/o Ward Wilson Limited 62 Deveron Street Invercargill New Zealand Telephone:(03) 211 0103 Facsimile:(03) 218 3623 TENNET INTERNATIONAL: Taps Graham and Gibson as Liquidators ----------------------------------------------------------- Grant Robert Graham and Brendon James Gibson were appointed as liquidators of Tennet International Ltd. on May 25, 2007. The company started to liquidate its business on that day. The Liquidators can be reached at: Grant Robert Graham Brendon James Gibson Ferrier Hodgson & Co Tower Centre, Level 16 45 Queen Street PO Box 982, Auckland New Zealand Telephone:(09) 307 7865 Facsimile:(09) 377 7794 THE PC RECYCLING: Court Hears Wind-Up Petition ---------------------------------------------- A petition to wind up the operations of The PC Recycling Channel Ltd. was heard before the High Court of Wellington on June 11, 2007. The Commissioner of Inland Revenue filed the petition on April 19, 2007. The CIR's solicitor is: Philip Hugh Brian Latimer c/o Legal and Technical Services New Zealand Post House, 1st Floor 7-27 Waterloo Quay PO Box 1462, Wellington New Zealand Telephone:(04) 890 1028 Facsimile:(04) 890 0009 UNION INTERACTIVE: Fixes July 1 as Last day to Prove Claims ----------------------------------------------------------- The shareholders of Union Interactive Ltd. met on June 1, 2007, and agreed to liquidate the company's business. Robert Laurie Merlo, the company's liquidator, requires its creditors to file their proofs of debt by July 1, 2007. The Liquidator can be reached at: Robert Laurie Merlo Merlo Burgess & Co. Limited PO Box 51486, Pakuranga Auckland, New Zealand Telephone:(09) 520 7101 Facsimile:(09) 529 1360 E-mail: merloburgess&co@xtra.co.nz ===================== P H I L I P P I N E S ===================== BANCO DE ORO-EPCI: Equitable PCI Now Removed From PSEi and Index ---------------------------------------------------------------- The Philippine Stock Exchange has removed Equitable PCI Bank Inc. from the PSEi and the Financials Index effective June 4, following its merger with Banco de Oro Universal Bank. The constituents of the PSEi are now 29 in number, while the Financials index now has 13 constituents following the removal. Banco de Oro-EPCI is the result of a merger between Banco de Oro Universal Bank and Equitable PCI, with BDO as the surviving entity. * * * The Troubled Company Reporter – Asia Pacific reported on November 9, 2006 that Fitch Ratings affirmed the ratings of Banco De Oro Universal Bank, as follows: * Individual 'C/D', and * Support '3' * * * On June 1, 2007, Moody's Investors Service said it had withdrawn its ratings for Equitable PCI Bank (EPCI) following its merger with Banco de Oro Universal Bank (BDO). In a statement, Moody's said the merged entity, Banco de Oro-EPCI, will assume BDO's "Ba2" rating both for its senior unsecured debt and subordinated debt, with a stable outlook. Moody’s withdrew its ratings for Equitable PCI following the merger. Standard & Poor's Ratings Services withdrew its 'BB-' counterparty credit ratings on Equitable PCI Bank Inc., as its merger with Banco De Oro Universal Bank became effective on May 31. S&P retained its 'BB-' counterparty credit rating and the issue ratings on both Equitable and Banco de Oro's rated debts. Equitable’s rated debts will be transferred to the Banco de Oro-EPCI. BAYAN TELECOMMUNICATIONS: Posts PHP101-Mil. Loss in 1st Quarter --------------------------------------------------------------- Bayantel recorded a net loss of PHP101.0 million for the three months ended Mar. 31, 2007, versus a net income of PHP357 million in the first quarter of 2006 due to lower foreign exchange gains, according to parent company, Benpres Holdings Corp. Bayantel's first quarter revenues went up by 12% year on year to PHP1.3 billion driven by voice and data revenues, which increased by 11% and 16% respectively. EBITDA in the first quarter amoutned to PHP416.0 million, slightly lower than last year's PHP428.0 million. Bayan Telecommunications Holdings Corporation, which is 85.4% owned by Benpres Holdings Corp. and the Lopez Group, was incorporated on October 15, 1993. Bayan Telecommunications Inc. -- http://www.bayantel.com.ph/-- is the operating arm of BTHC and is formerly known as International Communications Corporation. BayanTel is a telecommunications company offering an extensive breadth of traditional links and circuitry as well as cutting edge data and voice applications. BayanTel's existing service areas in Metro Manila and Bicol, as well as its local exchange service areas in the Visayas and Mindanao regions combined, cover a population of over 25 million, nearly 33% of the population of the Philippines. BayanTel has operations in Japan and the U.K. In a report by the Troubled Company Reporter - Asia Pacific on July 4, 2006, the Company has paid over PHP900 million in principal and interest on its debts amounting to PHP25.39 billion in aggregate, of which creditors own PHP14.74 billion, while PHP10.65 billion is due to its bondholders. On June 28, 2004, the Pasig Regional Trial Court Branch 158 approved the company's financial rehabilitation based on sustainable debt level of PHP17.13 billion, payable over 19 years. According to RTC Judge Rodolfo R. Bonifacio, the remainder of BayanTel's debt may be converted to another appropriate instrument that will not be a financial burden to parent Benpres Holdings Corp. It also mandated BayanTel to treat all creditors equally. Some of BayanTel's creditors have appealed the lower court decision. BENPRES HOLDINGS: Earns PHP828 Million in First Quarter of 2007 --------------------------------------------------------------- Benpres Holdings Corp. reported a net income of PHP828.0 million for the first quarter of 2007, more than halving the previous corresponding period’s PHP2.1 billion net income. The company also reported consolidated revenues of PHP4.2 billion in the first three months of 2007, 6% higher than PHP4.0 billion in the same period in 2006. Net income attributable to the equity holders of the parent company decreased by 64% to PHP731.0 million from PHP1.9 billion in 2006, which included gains booked by unit First Philippine Holdings Corp. from the initial public offering of First Gen Corp. in Feb. 2006. Net income for the first quarter of 2007 amounted to PHP731 million, 16% more compared to the first quarter 2006 recurring net income of PHP632.0 million. About Benpres Holdings Headquartered in Pasig City Philippines, Benpres Holdings Corporation is a 56.22%-owned subsidiary of Lopez, Inc. Both entities were incorporated in the Philippines. Benpres Holdings and its subsidiaries are mainly involved in investment holdings, broadcasting and entertainment, and water distribution. The Company's associates are involved in telecommunications, power generation and distribution, cable television, real estate development and infrastructure. Starting in 2002, Benpres Holdings defaulted on its principal and interest payments on its long-term direct obligations and guarantees and commitments. As proposed in the Company's Balance Sheet Management Plan, all of Benpres' liabilities were computed as of May 31, 2002. Also as proposed in the BSMP, the Company would make good faith semi-annual payments on its direct and contingent obligations. The first payment was made on December 2, 2002, and succeeding payments were made in June and December 2003, June and November 2004, and May and November 2005. As of Dec. 31, 2005, Benpres Holdings' long-term direct obligations due for payment stood at PHP9.96 billion. By virtue of its guarantees and commitments, based on the BSMP, the Company may be liable for certain obligations that already fell due, amounting to approximately PHP10.94 billion as of Dec. 31, 2005, excluding guarantees in its unit, Maynilad Water Services, Inc. As of December 31, 2005, consolidated current liabilities exceeded consolidated current assets by PHP22.12 billion. Net loss attributable to Benpres Holdings' equity holders for the year ended December 31, 2004, amounted to PHP1.2 billion. CHIQUITA BRANDS: Colsiba Accuses Possible Covenant Breach --------------------------------------------------------- Colsiba, the coordination board for unions of Latin American banana plantation employees, has accused Chiquita Brands of planning to break a covenant with the group, Fresh Plaza reports. Fresh Plaza relates that Colsiba alleged that the most basic standards that have been set were breached and the accords made in discussions with Colsiba are not being respected. Colsiba told Fresh Plaza that the situation in Nicaragua causes the most concern. Collective labor accords have not been renegotiated over the past 10 years. The salaries on the plantations are at 1,5 dollar a day and labor conditions are harsh. Workers often don't get tools or protective gear. Fresh Plaza notes that in Guatemala, talks on a new collective labor accord have been going on for nine months, while discussions on the matter has taken 10 months in Honduras. Chiquita Brands doesn't want to increase salaries and improve social conditions while output goals have been set at record levels, Colsiba told Fresh Plaza. Cincinnati, Ohio-based Chiquita Brands International, Inc. (NYSE: CQB) -- http://www.chiquita.com/-- operates as an international marketer and distributor of bananas and other fresh produce sold under the Chiquita and other brand names in over 70 countries including Panama, Philippines, Australia, Belgium, Germany, among others. It also distributes and markets fresh-cut fruit and other branded, value-added fruit products. * * * As reported in the Troubled Company Reporter-Latin America on May 16, 2007, Moody's Investors Service changed the rating outlook for Chiquita Brands International, Inc. to negative from stable. Ratings affirmed: * Chiquita Brands International, Inc. (parent holding company) -- Corporate family rating at B3 -- Probability of default rating at B3 -- US$250 million 7.5% senior unsecured notes due 2014 at Caa2 (LGD5, 89%) -- US$225 million 8.875% senior unsecured notes due 2015 at Caa2 (LGD5, 89%) * Chiquita Brands LLC (operating subsidiary): -- US$200 million senior secured revolving credit agreement at B1 (LGD2, 26%) -- US$24.3 million senior secured term loan B at B1 (LGD2, 26%) -- US$368.4 million senior secured term loan C at B1 (LGD2, 26%). CHIQUITA BRANDS: Faces Lawsuit by Murder Victims' Families ---------------------------------------------------------- Families of the 173 people that Colombian terrorist groups allegedly murdered have filed a lawsuit against Chiquita Brands International Inc. before the U.S. District Court, District of Columbia, Cary O'Reilly at Bloomberg News reports. Bloomberg News' Ms. O'Reilly says that the families families claimed Chiquita Brands paid millions of dollars and tried to send machine guns to the paramilitary group United Self Defense Forces of Colombia. According to Bloomberg News' Ms. O'Reilly, the relatives are seeking for unspecified compensation, punitive damages and the names of Chiquita Brands executives who allowed the payments. El Tiempo notes that the lawyers claimed damages for an amount of around US$1 billion. Terry Collingsworth, the attorney representing the claimants and who is associated with the International Rights Advocates, told Bloomberg News' Ms. O'Reilly, "We want to know who made the decisions. The company is facing a very small fine, a slap on the risk, for its actions." The report says that Chiquita Brands pleaded guilty in March 2007 to charges of funding US$1.7 million to terrorist groups in Colombia from 1997 to 2004. The company said it made the payment to protect banana operations and workers. The paramilitary group is involved in drug trafficking, assassinations, kidnappings and the murder of civilians in Colombia, where Chiquita Brands had operations, Bloomberg News' Ms. O'Reilly notes, citing prosecutors in March 2007. Chiquita Brands also paid other terrorist groups like the Revolutionary Armed Forced of Columbia. Chiquita Brands executives weren't charged. The firm agreed to be fined US$25 million to be levied at a sentencing hearing in June. It also agreed to cooperate in a Justice Department probe of the payments, according to Bloomberg News' Ms. O'Reilly. Chiquita Brands spokesperson said in a statement, "Chiquita Brands International categorically denies the allegations [in the lawsuit file by the family of the victims]. We reiterate that Chiquita and its employees were victims, and that the actions taken by the company were always motivated to protect the lives of our employees and their families." The U.S. Department of Justice said in its report, "Castano [a paramilitary group leader] sent an unspoken but clear message that failure to make the payments could result in physical harm to Banadex [Chiquita's Colombian subsidiary] personnel and property." El Tiempo relates that Chiquita Brands and 10 of its directors would be considered liable for the murder of 174 persons in Uraba and Magdalena by the paramilitaries and the Farc during the period when the firm made the payments. El Tiempo Washington correspondent Sergio Gomez Maseri, "who claimed to have received exclusivity" from the attorneys says, "This case concerns the systematic murder and intimidation of individuals in the banana growing region at the Gulf of Urabá and in the city of Santa Marta. The accused (Chiquita and its employees) contracted, armed and/or directed the terrorist groups who used extreme violence, murder, torture, detention and silencing against any individual who was suspected of interfering with the operations in Colombia of the accused." Human rights lawyer Paul Wolf and Bob Childs, the chief of a prestigious Alabaman firm, also represented the families Fresh Plaza states. Cincinnati, Ohio-based Chiquita Brands International, Inc. (NYSE: CQB) -- http://www.chiquita.com/-- operates as an international marketer and distributor of bananas and other fresh produce sold under the Chiquita and other brand names in over 70 countries including Panama, Philippines, Australia, Belgium, Germany, among others. It also distributes and markets fresh-cut fruit and other branded, value-added fruit products. * * * As reported in the Troubled Company Reporter-Latin America on May 16, 2007, Moody's Investors Service changed the rating outlook for Chiquita Brands International, Inc. to negative from stable. Ratings affirmed: * Chiquita Brands International, Inc. (parent holding company) -- Corporate family rating at B3 -- Probability of default rating at B3 -- US$250 million 7.5% senior unsecured notes due 2014 at Caa2 (LGD5, 89%) -- US$225 million 8.875% senior unsecured notes due 2015 at Caa2 (LGD5, 89%) * Chiquita Brands LLC (operating subsidiary): -- US$200 million senior secured revolving credit agreement at B1 (LGD2, 26%) -- US$24.3 million senior secured term loan B at B1 (LGD2, 26%) -- US$368.4 million senior secured term loan C at B1 (LGD2, 26%). CITY RESOURCES: Reports PHP2.86-Million Deficit as of Mar. 31 ------------------------------------------------------------- City Resources (Phil.) Corporation reported a net loss of PHP252.97 for the first quarter of 2007, against a PHP216.00 net loss for the previous corresponding period as the company continues its non-operating status. The company has a stockholders' equity deficit of PHP2.86 million as of Mar. 31, 2007. All of the assets of Pasig City, Philippines-based City Resources (Phils.) Corporation (CRC) over mining rights over all of its mineral properties in the Municipalities of Paracale and Labo, both in the Province of Camarines Norte, were sold as far back as January 31, 1994 to Crescent Mining and Development Corporation. On March 1, 1994, the stockholders approved the change in the primary purpose of the company from mining to that of a holding company. The SEC approved this amendment on March 24, 1994. Since then CRC had no operations. On October 2000, Lopez, Inc. acquired the right to purchase 7,515,850 fully paid shares and 79,504,310 partially paid shares of the company from Starfield Holdings, Inc., representing at least 91% of the outstanding capital stock of the company. For the year 2001, Lopez Inc. intends to exercise the rights and transfer the shares under its name or under the name of the affiliate. Lopez, Inc. will also revive the operations of the company as a holding Company by transferring assets to the company and will organize the company and activate its management in 2001. CRC is not presently conducting any business operations. EVER-GOTESCO RESOURCES: Posts PHP49-Mil. Net Income for 1st Qtr. ---------------------------------------------------------------- Ever-Gotesco Resources and Holdings, Inc., reported a net income of PHP49.24 million for the first quarter ended Mar. 31, 2007, against a net income of PHP39.59 million for the previous corresponding period. Rental revenue for the quarter in review amounted to PHP88.37 million, while operating costs and expenses amounted to PHP56.21 million, resulting in operating income of PHP32.16 million. This compares to the PHP80.75 million total revenues and PHP55.63 million operating costs and expenses and PHP25.12 million operating income for the first quarter of 2006. As of Mar. 31, 2007, the group had current assets of PHP636.09 million, and current liabilities of PHP2.02 billion. The company also posted total assets of PHP4.05 billion and total liabilities of PHP2.05 billion as of the same date. Headquartered in C.M. Recto Avenue, Manila, Ever-Gotesco Resources and Holdings, Inc., was established by the Ever- Gotesco Group to pursue its mall operations through its two subsidiaries, Ever Commonwealth Center and Ever Gotesco Ortigas Complex. The company is also engaged in real estate development. It builds and leases out shopping malls to commercial tenants. Revenues of the company are generated principally from its leasing operations. The company owns 100% of the outstanding capital stock of Gotesco Tyan Ming Development, Inc., owner of the Ever Gotesco Ortigas Complex. GTMDI was registered with the Securities and Exchange Commission on September 21, 1994, to engage in real estate and related business. GTMDI started its commercial operations on December 1, 1995, and has since taken over ownership and operations of the Mall cinemas. Going Concern Doubt Martin C. Guantes at Sycip Gorres Velayo and Co. raised significant doubt on the company's ability to continue as a going concern saying that the ultimate outcome of the following matters cannot be presently determined: (a) the consolidation by lender banks of the ownership and possession of the land and commercial complex of the company's wholly owned subsidiary, Gotesco Tyan Ming Development, Inc., pending the decision on the case by the court, and (b) the amount of staggered amortization as loan repayment that are due under a compromise agreement, which was approved by the court, from the defendants to a civil case in which the company and its subsidiary were impleaded. The auditors also cited that the company and its subsidiary continued to have substantial working capital deficiency and deficit. EXPORT & INDUSTRY BANK: Posts PHP80MM Net Loss in 1st Qtr. 2007 --------------------------------------------------------------- Export and Industry Bank, Inc., reported a PHP80.14 million net loss for the first quarter ending Mar. 31, 2007, plummeting 286,128.57% from the net loss of PHP28,000 for the previous corresponding period. The 2006 net loss, however, benefited from a one-off gain when the bank's common A shareholders took up PHP620.95 million in operating losses, which was subsequently recorded as a receivable and other income for that period. For the period in review, the bank reported interest income of PHP300.97 million and interest expense of PHP289.12 million, giving it a net interest income of PHP11.85 million, a turnaround from the net interest expense position of PHP287.90 million for the previous corresponding period. The bank also had higher other income for the first quarter of 2007 at PHP206.49 million, up 159.26% from PHP79.65 million reported a year earlier. The bank was also successful in trimming its other expenses down to PHP298.28 million for the period in review, from PHP411.53 million a year earlier. Key Performance Indicators The bank’s Basel 1 Capital Adequacy Ratio stood at 27.06% computed to December 2006’s level of 26.91%, which is way above the 10% and 8% minimum requirements of the Bangko Sentral ng Pilipinas and of the Bank for International Settlement. On consolidated basis, qualifying capital increased by 3.4% from PHP4.67 billion to PHP4.83 billion. As of end-March 2007, the bank posted a 6.71% non-performing loan ratio, slightly lower compared to December 2006 level of 7.20%. Although NPLs amounting to PHP286.00 million remained fairly the same compared to 2006, the total loan levels went up to PHP4.26 billion in 2007 from PHP3.62 billion in 2006, due to the purchase of government securities under reverse repurchase agreement with Bangko Sentral ng Pilipinas. Similarly, the ratio of the bank’s non-performing assets to gross assets went down from 2.12% in 2006 to 1.57% in 2007. Headquartered in Makati City, Manila, Export and Industry Bank, Inc. -- http://exportbank.com.ph/-- has 50 branches and has revived former Urban Bank unit under new names. Its principal activity is the provision of commercial banking services such as deposit taking, loans and trade finance, domestic and foreign fund transfers, treasury, foreign exchange and trust services. The bank is saddled with the PHP10 billion non-performing assets it inherited from Urban Bank when the two banks merged in 2002. The TCR-AP reported on May 10, 2006, that Exportbank is scheduled to complete a rehabilitation program, which was proposed in order to reverse a 2005 net loss of PHP1.66 million, by 2007. Under an agreement dated December 29, 2005, the Philippine Deposit Insurance Corp. extends annual financial aid of PHP600 million to the bank. PHIL NAT'L BANK: Pursues PHP25 Mil. Estafa Case v. Ex-Employees --------------------------------------------------------------- The Philippine National Bank is pursuing charges of large scale estafa and swindling against two of its former executives and their three accomplices involving pre-terminated time deposits of the University of the Philippines. Filed before the Office of the Quezon City Prosecutor, the complaint alleged that Rosemarie Ann Pamplona, Evangeline Domingo and their accomplices Joyce Raymond Punzalan, Jamie Santos and Ely Zonda Clemente fraudulently preterminated the UP's time deposits amouting to PHP25 million. The complaint further alleged that the defendants deposited the amount in at least three accounts owned by Santos and Clemente, two of which held PHP8 million each. The third account held the remaining PHP9.14 million. Pamplona and Domingo then tinkered with bank transaction journal entries to cover up the act. Pamplona was the UP Diliman branch's former junior sales and service officer, and Domingo is a former senior sales and service associate with the bank. Punzalan is a professor in the UP College of Statistics. The UP sent a letter on February 28 requesting the PNB to terminate one of its time deposit accounts in the bank. This, the bank claimed, led to the fraud's discovery. Punzalan denied involvement and knowledge in the fraudulent pretermination in a counter-affidavit and claimed that she is also a victim of the conspiracy. Punzalan said Pamplona and Domingo conspired with senior officers of the bank to falsify bank documents, including her checking account, without her knowledge or consent. In a statement with the Philippine Stock Exchange, the bank's management assured the public that its customers have not suffered losses due to the fraudulent transaction. It also expressed confidence in its current network of controls, through which it claimed to have discovered similar irregularities and was able to avoid further losses. About PNB Philippine National Bank -- http://www.pnb.com.ph/-- is the Philippine's first universal bank established on July 22, 1916. The bank's core business consists of lending and deposit-taking activities from corporate, middle market and retail customers, as well as various government units. Its other principal activities include bill discounting, fund transfers, remittance servicing, foreign exchange dealings, retail banking, trust services, treasury operations and trade finance. Through its subsidiaries, PNB engages in a number of diversified financial and related businesses such as international merchant banking, investment banking, life/non-life insurance, leasing, financing of small-and-medium-sized industries, and financial advisory services. It introduced innovations such as the bank on wheels, computerized banking, ATM banking, mobile money changing and domestic travelers' checks. * * * The Troubled Company Reporter – Asia Pacific reported on November 6, 2006 that Moody's Investors Service has revised the outlook of Philippine National Bank's foreign currency long-term deposit rating of B1, local currency senior debt rating of Ba2, and local currency subordinated debt rating of Ba3 to stable from negative. The outlook for PNB's foreign currency Not-Prime short-term deposit rating and bank financial strength rating of E remains stable. The Troubled Company Reporter – Asia Pacific reported on Nov. 1, 2006 that Fitch Ratings affirmed Philippine National Bank's Individual rating at 'E' and Support rating '3' after a review of the bank. The Troubled Company Reporter – Asia Pacific reported that Standard and Poor's Ratings Services has given PNB 'B' Short-Term Foreign Issuer Credit and Short-Term Local Issuer Credit Ratings, as well as 'B-' Long-Term Foreign Issuer Credit and Long-Term Local Issuer Credit Ratings effective as of April 26, 2006. SERVICEMASTER CO: S&P Rates US$3.35 Billion Sr. Facilities at B+ ---------------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit rating on The ServiceMaster Co. to 'B' from 'BB+'. At the same time, Standard & Poor's lowered its rating on ServiceMaster's existing senior unsecured debt to 'CCC+' from 'BB+', reflecting its junior position relative to the firm's new secured debt. All ratings were removed from CreditWatch, where they were originally placed with negative implications on Nov. 28, 2006, following the company's board of directors' decision to explore strategic alternatives to maximize shareholder value. The rating outlook is negative. At the same time, Standard & Poor's assigned its loan and recovery ratings to ServiceMaster's proposed US$3.35 billion senior secured credit facilities, consisting of a: * US$500 million revolver, * US$2.65 billion term loan, and * US$200 million synthetic letter of credit facility. The facilities were rated 'B+' with a recovery rating of '2', indicating the expectation for substantial (70%-90%) recovery in the event of a payment default. These ratings are based on preliminary documentation and are subject to revision upon receipt and review of final documentation. The ratings on ServiceMaster reflect its very highly leveraged financial profile following its pending acquisition by an investment group led by Clayton, Dubilier & Rice Inc. for about US$5.6 billion, which will result in pro forma total debt to EBITDA exceeding 9x at closing and significant cash flow requirements to fund interest. Ratings support is provided by ServiceMaster's good business positions in its fragmented and competitive end markets, which have translated into good cash flow generation from a fairly diverse portfolio of services, despite some exposure to weather conditions in two of three of its key businesses. "We expect operating performance to gradually improve over the next few years through continued improvement in retention rates, productivity savings from functional support areas resulting from completing the company's restructuring project, and cost savings from consolidating its Memphis headquarters," said Standard & Poor's credit analyst Jean Stout. "Nevertheless, leverage is very high following the buyout." The company operates in the Philippines, Puerto Rico and the United Kingdom. ZIPPORAH REALTY: Sells 80 Million Shares in Ebedev to Beziers ------------------------------------------------------------- Zipporah Realty Holdings Inc. sold on June 1, 2007, its rights and interests in 80 million fully paid and non-assessable shares of stock in its wholly owned subsidiary Ebedev Inc. to Beziers Holdings Inc. The book value of the transaction is based on the 2006 audited financial statements of Ebedev, which provided that if the book value is negative, the purchase price will be PHP1. Beziers is a corporation having principal offices at 14 F. Paz Street, Sta. Elena, Marikina City, Metro Manila. It was represented in the transaction by its President, Romeo Roman A. Cristi. Zipporah Realty Holdings, Inc. was originally incorporated as a mining firm. Presently, it is primarily engaged in real estate holding and development with mining as its secondary purpose. Its main source of revenue comes from sales of real estate properties. The company's subsidiary, EBEDEV, Inc., launched its first project, the Westmont Village Project along Dr. A. Santos Avenue in Sucat, Paranaque, which started commercial operations in January 1996. The Westmont Village was conceptualized primarily to answer the needs of young urban professionals and the growing demands of the medium income market for a condominium project accessible to the centers of commerce and industry, affordable and with the amenities of a first-class condominium. The company has PHP746.12 million deficit for the year 2006. ZIPPORAH REALTY: Annual Stockholders' Meeting Moved to July 16 -------------------------------------------------------------- The annual stockholders meeting for Zipporah Realty Holdings Inc. has been moved from June 29 to July 16, 2007. Notices and definitive information statement will be sent out to stockholders on June 25, 2007. Stockholders have until July 6, to submit their proxies for the meeting to the Corporate Secretary at the company's principal headquarters. These proxies will be validated on July 11. Zipporah Realty Holdings, Inc. was originally incorporated as a mining firm. Presently, it is primarily engaged in real estate holding and development with mining as its secondary purpose. Its main source of revenue comes from sales of real estate properties. The company's subsidiary, EBEDEV, Inc., launched its first project, the Westmont Village Project along Dr. A. Santos Avenue in Sucat, Paranaque, which started commercial operations in January 1996. The Westmont Village was conceptualized primarily to answer the needs of young urban professionals and the growing demands of the medium income market for a condominium project accessible to the centers of commerce and industry, affordable and with the amenities of a first-class condominium. The company has PHP746.12 million deficit for the year 2006. ================= S I N G A P O R E ================= HEXION SPECIALTY: S&P Revises Recovery Ratings on 2nd-Lien Notes ---------------------------------------------------------------- Standard & Poor's Ratings Services revised certain issue and recovery ratings for Hexion Specialty Chemicals Inc.'s senior secured debt to reflect the recently announced changes to Standard & Poor's recovery scale, and some changes to Hexion's senior secured debt. The financing consists of about US$2.5 billion senior secured first-lien bank facilities (including proposed add-ons to its term loan and synthetic letter of credit of US$200 million and US$10 million, respectively, that are expected to be funded in mid-June 2007) and US$825 million senior secured second-lien notes. S&P raised the issue ratings on the first-lien facilities to 'B+' from 'B', with unchanged recovery ratings of '2', indicating its expectation of a substantial recovery (70%-90%) in the event of a payment default. The issue ratings on the second-lien notes were raised to 'B' from 'B-' and the recovery rating was revised to '4' from '3', indicating expectations for an average recovery (30%-50%) in the event of a default. The change in the recovery rating for the second-lien notes is primarily the result of the inclusion of pre-petition interest in our recovery calculation and the increase in the size of the first-lien facilities. The likelihood of default for these issues has not changed and is reflected in Hexion's corporate credit rating of B/Stable/--. However, with the introduction of our new issue rating and notching framework, the secured issue ratings on the first-lien bank credit facilities and the second-lien notes have been raised by one notch. "The ratings on Hexion reflect a highly leveraged financial profile, a very aggressive financial policy, and a weak business risk profile as a global manufacturer and marketer of thermoset resins," said Standard & Poor's credit analyst Paul Kurias. Ratings List Hexion Specialty Chemicals Inc. Corporate credit rating B/Stable/-- Senior secured first-lien bank credit facilities B+ Recovery rating 2 Second-lien notes due 2014 B Recovery rating 4 The company has its Asian headquarters in Singapore, with offices in Australia, China, Korea, Malaysia, New Zealand, Taiwan, and Thailand. INFOTECH VENTURES: Receiving Proofs of Debt Until July 9 -------------------------------------------------------- Infotech Ventures Ltd, which is in voluntary liquidation, is receiving the creditors' proofs of debt until July 9, 2007. Failure to prove debts by the due date will exclude a creditor from sharing in the company's dividend distribution. The company's liquidator is: Timothy James Reid 50 Raffles Place #16-06 Singapore Land Tower Singapore 048623 INTEGRAL PERIPHERALS: Proofs of Claim Bar Date is June 22 --------------------------------------------------------- Integral Peripherals Pte Ltd, which is in compulsory liquidation, is accepting creditors' proofs of debt until June 22, 2007. The company's liquidator is: Tay Swee Sze c/o Tay Swee Sze & Associates 137 Telok Ayer Street Singapore 068602 KODAK VERSAMARK: Requires Creditors to Prove Debts by July 8 ------------------------------------------------------------ Kodak Versamark (Asia Pacific) Pte. Limited, which is in liquidation, requires its creditors to file their proofs of debt by July 8, 2007. Failure to prove debts by the due date will exclude a creditor from sharing in the company's dividend distribution. The company's liquidator is: Tam Chee Chong 6 Shenton Way #32-00 DBS Building Tower Two Singapore 068809 MTU ASIA: Creditors' Proofs of Debt Due by July 9 ------------------------------------------------- The creditors of MTU Asia (Singapore) Pte Ltd are required to file their proofs of debt by July 9, 2007, to be included in the company's dividend distribution. The company's liquidator is: Kok Pooi Han c/o 1 Benoi Place Singapore 629923 SEA CONTAINERS: Court Approves Archlane Leases Settlement Pact -------------------------------------------------------------- The Honorable Kevin J. Carey of the U.S. Bankruptcy Court for the District of Delaware has approved the leases settlement agreement between Sea Containers, Ltd. and its debtor-affiliates, and Archlane Limited. As reported in the Troubled Company Reporter on May 10, 2007, the settlement pertains to the Debtors' corporate headquarter premises, of which Archlane Limited is the current landlord. The aggregate annual rent under the Leases is approximately GBP2,550,000, or about US$5,100,000 at current exchange rates. SCSL also pays about GBP1,116,020, or US$2,178,040, in additional aggregate annual charges under the Leases for utilities and other services. The Debtors estimate that the aggregate payment obligations remaining under the Lease may aggregate more than US$36,000,000. After careful analysis of their options with respect to the Leases, the Debtors have decided that a settlement with Archlane surrendering the Leases and entering into new shorter-term leases is the best choice for maximizing value for their estates. After intensive negotiations, the Debtors and Archlane reached a settlement that principally provides for, among others: (1) Surrender of SCSL's current Leases subject to a GBP7,000,000 payment to Archlane; and (2) Entry into new leases for the current occupied Premises under the Leases commencing on May 18, 2007, and expiring on June 30, 2007. About Sea Containers Based in Hamilton, Bermuda, Sea Containers Ltd. -- http://www.seacontainers.com/-- provides passenger and freight transport and marine container leasing. Registered in Bermuda, the company has regional operating offices in London, Genoa, New York, Rio de Janeiro, Sydney, and Singapore. The company is owned almost entirely by United States shareholders and its primary listing is on the New York Stock Exchange (SCRA and SCRB) since 1974. On Oct. 3, the company's common shares and senior notes were suspended from trading on the NYSE and NYSE Arca after the company's failure to file its 2005 annual report on Form 10-K and its quarterly reports on Form 10-Q during 2006 with the U.S. Securities and Exchange Commission. Through its GNER subsidiary, Sea Containers Passenger Transport operates Britain's fastest railway, the Great North Eastern Railway, linking England and Scotland. It also conducts ferry operations, serving Finland and Estonia as well as a commuter service between New York and New Jersey in the U.S. Sea Containers Ltd. and two subsidiaries filed for chapter 11 protection on Oct. 15, 2006 (Bankr. D. Del. Case No. 06-11156). Edmon L. Morton, Esq., Edwin J. Harron, Esq., Robert S. Brady, Esq., Sean Matthew Beach, Esq., and Sean T. Greecher, Esq., at Young, Conaway, Stargatt & Taylor, represent the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors and the Financial Members Sub-Committee of the Official Committee of Unsecured Creditors of Sea Containers Ltd. is represented by William H. Sudell, Jr., Esq., and Thomas F. Driscoll, Esq., at Morris, Nichols, Arsht & Tunnell LLP. Sea Containers Services, Ltd.'s Official Committee of Unsecured Creditors is represented by attorneys at Willkie Farr & Gallagher LLP. In its schedules filed with the Court, Sea Containers Ltd. disclosed total assets of US$62,400,718 and total liabilities of US$1,545,384,083. (Sea Containers Bankruptcy News, Issue No. 17; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) The Debtors' exclusive period to file a plan of reorganization expires on Sept. 28, 2007. =============== T H A I L A N D =============== DAIMLERCHRYSLER: Recalls 1,443 Faulty Chinese-Made Chrysler Cars ---------------------------------------------------------------- DaimlerChrysler AG is recalling 1,443 Chinese-made Chrysler 300C sedans produced between March 21 and May 29 to fix defective transmission cooling systems, Reuters reports, quoting a statement posted by China's General Administration of Quality Supervision, Inspection and Quarantine on its Web site. According to the statement, imported Chrysler 300C cars were not affected. It did not say, however, whether any accidents or personal injuries had been linked to the defect, Reuters notes. DaimlerChrysler's Chinese joint venture in Beijing began limited production of the 300C in 2005. About DaimlerChrysler Based in Stuttgart, Germany, DaimlerChrysler AG (NYSE:DCX) (FRA:DCX) -- http://www.daimlerchrysler.com/-- develops, manufactures, distributes, and sells various automotive products, primarily passenger cars, light trucks, and commercial vehicles worldwide. It primarily operates in four segments: Mercedes Car Group, Chrysler Group, Commercial Vehicles, and Financial Services. The company's worldwide operations are located in: Canada, Mexico, United States, Argentina, Brazil, Venezuela, China, India, Indonesia, Japan, Thailand, Vietnam, and Australia. The Chrysler Group segment offers cars and minivans, pick-up trucks, sport utility vehicles, and vans under the Chrysler, Jeep, and Dodge brand names. It also sells parts and accessories under the MOPAR brand. The Chrysler Group is facing a difficult market environment in the United States with excess inventory, non-competitive legacy costs for employees and retirees, continuing high fuel prices and a stronger shift in demand toward smaller vehicles. At the same time, key competitors have further increased margin and volume pressures -- particularly on light trucks -- by making significant price concessions. In addition, increased interest rates caused higher sales & marketing expenses. In order to improve the earnings situation of the Chrysler Group as quickly and comprehensively, measures to increase sales and cut costs in the short term are being examined at all stages of the value chain, in addition to structural changes being reviewed as well. DAIMLERCHRYSLER: Warrant Holder Wants to Exercise Right to Trust ---------------------------------------------------------------- DaimlerChrysler AG disclosed that the U.S. Bank Trust National Association, Trustee, has received notice that the call warrant holder has exercised its right to purchase the assets of the Trust on June 12, 2007. The notice was in connection to the Standard Terms for Trust Agreements dated as of Jan. 16, 2001, as supplemented by the Series Supplement, DaimlerChrysler Debenture-Backed Series 2004-3 Trust, dated as of Feb. 11, 2004 in respect of the Corporate Backed Trust Certificates, DaimlerChrysler Debenture-Backed Series 2004-3 with Lehman ABS Corporation, as depositor. If the Trustee receives the call price by 10:00 a.m. on the Redemption Date, then the certificates issued by the Trust will be redeemed in full on the Redemption Date at a price of US$25 principal plus US$0.36579306 accrued interest to the Redemption Date per Trust Certificate. No interest will accrue on the Certificates after the Redemption Date. If the Trustee does not receive the Call Price, then (i) the Certificates issued by the Trust will continue to accrue interest as if no exercise notice had been given and (ii) the call warrant holder may elect to deliver a conditional notice of exercise in the future. For more information about this conditional redemption, please contact David J. Kolibachuk of U.S. Bank Trust National Association at 212-361-2459. Based in Stuttgart, Germany, DaimlerChrysler AG (NYSE:DCX) (FRA: DCX) -- http://www.daimlerchrysler.com/-- develops, manufactures, distributes, and sells various automotive products, primarily passenger cars, light trucks, and commercial vehicles worldwide. It primarily operates in four segments: Mercedes Car Group, Chrysler Group, Commercial Vehicles, and Financial Services. The company's worldwide operations are located in: Canada, Mexico, United States, Argentina, Brazil, Venezuela, China, India, Indonesia, Japan, Thailand, Vietnam, and Australia. The Chrysler Group segment offers cars and minivans, pick-up trucks, sport utility vehicles, and vans under the Chrysler, Jeep, and Dodge brand names. It also sells parts and accessories under the MOPAR brand. The Chrysler Group is facing a difficult market environment in the United States with excess inventory, non-competitive legacy costs for employees and retirees, continuing high fuel prices and a stronger shift in demand toward smaller vehicles. At the same time, key competitors have further increased margin and volume pressures -- particularly on light trucks -- by making significant price concessions. In addition, increased interest rates caused higher sales & marketing expenses. In order to improve the earnings situation of the Chrysler Group As quickly and comprehensively, measures to increase sales and cut costs in the short term are being examined at all stages of the value chain, in addition to structural changes being reviewed as well. DAIMLERCHRYSLER AG: Aims to Boost Sales & Make Mercedes No. 1 ------------------------------------------------------------- DaimlerChrysler AG CEO Dieter Zetsche told the Financial Times that the carmaker would "focus more on the top line, on the creation o f our business going forward and less on the repairs," and hopes to push Mercedes into its previously held spot as the world’s most profitable luxury carmaker following the sale of the company's ailing unit, Chrysler Group, to Cerberus Capital Management LP. The DaimlerChrysler break-up has rekindled the interest of investors in the performance of both the new Daimler and Mr. Zetsche, who has denied any responsibility for the U.S. division's troubles in 2006, mere months after he left the division, FT observes. "I am convinced that Chrysler today is in much better shape than it was six to seven years ago, and you have quite a lot of parameters to prove that -- quality, productivity and the portfolio," Mr. Zetsche claims. The chief executive also said that Mercedes, which has trailed its main rival BMW on both sales and profitability in recent years, should expect faster revenues growth compared with the luxury car market, which itself has above-average growth, FT notes. There are no acquisition or large product expansion plans for the brand but it will push harder into emerging markets such as Russia, eastern Europe, China and India. He added that he would resist calls to split off the trucks business -- the world’s largest -- from Mercedes but that management would seek to make it the "benchmark" in the industry. About DaimlerChrysler Based in Stuttgart, Germany, DaimlerChrysler AG (NYSE:DCX) (FRA:DCX) -- http://www.daimlerchrysler.com/-- develops, manufactures, distributes, and sells various automotive products, primarily passenger cars, light trucks, and commercial vehicles worldwide. It primarily operates in four segments: Mercedes Car Group, Chrysler Group, Commercial Vehicles, and Financial Services. The company's worldwide operations are located in: Canada, Mexico, United States, Argentina, Brazil, Venezuela, China, India, Indonesia, Japan, Thailand, Vietnam, and Australia. The Chrysler Group segment offers cars and minivans, pick-up trucks, sport utility vehicles, and vans under the Chrysler, Jeep, and Dodge brand names. It also sells parts and accessories under the MOPAR brand. The Chrysler Group is facing a difficult market environment in the United States with excess inventory, non-competitive legacy costs for employees and retirees, continuing high fuel prices and a stronger shift in demand toward smaller vehicles. At the same time, key competitors have further increased margin and volume pressures -- particularly on light trucks -- by making significant price concessions. In addition, increased interest rates caused higher sales & marketing expenses. In order to improve the earnings situation of the Chrysler Group as quickly and comprehensively, measures to increase sales and cut costs in the short term are being examined at all stages of the value chain, in addition to structural changes being reviewed as well. FEDERAL-MOGUL: Modifies 4th Amended Plan to Address Objections -------------------------------------------------------------- James E. O'Neill, Esq., at Pachulski, Stang, Ziehl, Young, Jones & Weintraub LLP, in Wilmington, Delaware, notes, on behalf of Federal-Mogul Corp. and its debtor-affiliates, tell the U.S. Bankruptcy Court for the District of Delaware that 11 objections to confirmation of the Fourth Amended Joint Plan of Reorganization were filed by insurers, while 15 plan confirmation objections were filed by non-insurers. Several parties, including counsel and former advisers of PepsiAmericas, Inc., and certain insurance companies, have declared their support for the objections. On the other hand, other parties declared their support for the confirmation of the Plan, including The Flexitallic Group, Inc., Research and Planning Corporation, and counsel and affiliates of the Plan Proponents. The Debtors, the Official Committee of Unsecured Creditors, the Official Committee of Asbestos Claimants, the Legal Representative for Future Asbestos Claimants, the Official Committee of Equity Security Holders, and JPMorgan Chase Bank, N.A., have engaged objecting parties in an attempt to resolve the objections consensually, Mr. O'Neill relates. As a result, several objections have been resolved and others have been withdrawn. The Plan Proponents have modified the Fourth Amended Plan to reflect technical changes or clarifications in response to informal and formal objections or requests for clarification made by parties in interest, Mr. O'Neill says. Among others, the Modified Fourth Amended Plan: -- incorporates the Court-approved settlement with certain holders of Asbestos Property Damage Claims and the settlement of certain claims, Plan objections, and insurance rights between, among others, the Debtors and MagneTek, Inc.; -- states that all fees payable pursuant to Section 1930(a)(6) of the Judiciary and Judicial Procedure Code will be paid on or before the Effective Date; and -- classifies PepsiAmerica's claims as unsecured claims. The Plan Proponents aver that the Modified Plan: * fully satisfies all applicable requirements of the Bankruptcy Code and is confirmable; * reflects a negotiated consensus among a large number of sophisticated commercial parties with deeply divergent interests; * equitizes both the Debtors' asbestos liabilities and the Debtors' prepetition note debt; and * brings about a unified conclusion to the U.K. Debtors' cross-border insolvency proceedings. The Modifications do not materially and adversely affect or change the treatment of any claim against or equity interest in any Debtor, Mr. O'Neill tells the court. Accordingly, the Plan Proponents ask the Court to waive the requirement of resolicitation of any holders of claims or equity interests pursuant to Rule 3019 of the Federal Rules of Bankruptcy Procedure. A full-text copy of the Modified Fourth Amended Joint Plan of Reorganization dated June 4, 2007, is available for free at: http://bankrupt.com/misc/FMC_4modChap11Plan.pdf A full-text blacklined copy of the Modified Fourth Amended Plan is available for free at: http://bankrupt.com/misc/FMC_4modChap11Plan_blackline.pdf The Plan Proponents note that all parties that have a legitimate pecuniary stake in the success of the Debtors' reorganization have spoken powerfully in favor of confirmation of the Plan. Mr. O'Neill argues that contrary to the contentions of the insurance companies, the Plan is insurance neutral. "The insurers are transparently attempting to assert the rights of holders of asbestos personal injury claims or other creditors, and are not limiting themselves to issue that have any effect on the insurers themselves," he contends. The only objection to which the insurers have standing -- the argument that the Plan violates the contractual rights of certain insurers by assigning certain rights under insurance policies to the Trust without their consent -- is entirely without merit, according to Mr. O'Neill. He points out that courts in the Third Circuit including the Bankruptcy Court have held, on more than one occasion, that a debtor's rights under insurance policies can be assigned to a 524(g) trust under a plan of reorganization pursuant to Section 1123(a)(5) of the Bankruptcy Code. "If the objecting insurers bear financial responsibility for the Asbestos Personal Injury Claims, it will not be because of anything imposed by the Plan, but simply because of their contractual obligations under comprehensive general insurance policies they sold to the Debtors and various other parties before the bankruptcy," Mr. O'Neill says. In response to the objection that the Trust Distribution Procedures provide the trustees with too much discretion, the Plan Proponents point out that the Bankruptcy Court has repeatedly found that trust distribution procedures substantively identical to those of the TDPs, which empower the trustees to modify the payment percentage and many other provisions, satisfy the requirements of Section 524(g)(2)(B)(ii)(V). The flexibility afforded the trustees under the trust documents is what ultimately provides the "reasonable assurance that the trust will value, and be in a financial position to pay, present claims and future demands that involve similar claims in substantially the same manner" under Section 524(g)(2)(B)(ii)(V), Mr. O'Neill emphasizes. The objectors' efforts to allege that the Trust Advisory Committee's membership violates Section 1129(a)(5) of the Bankruptcy Code or is otherwise improper is likewise hollow because Section 1129(a)(5) only applies to an individual who is "a director, officer, or voting trustee." If state law permits asbestos claimants to bring claims against the Asbestos Personal Injury Trust later or to avoid apportionment of damages in their other state law cases, then that is perfectly appropriate, but there is no basis to say that claimants must file claims before they are required to do so by state law, Mr. O'Neill contends. Similarly, if state law does not permit asbestos claimants to bring claims against the Trust later or avoid apportionment of damages, then the TDPs create no new substantive rights to do so. The TDPs, he maintains, provides for the confidentiality of claimants' submissions and does not take away any state law discovery rights. In accordance with Section 524(g)(2)(B)(i)(II), the Plan Proponents maintain that the Plan provides that the Trust will be funded in part by the Reorganized Federal-Mogul Class B Common Stock, which comprises 50.1% of the total common stock in Reorganized Federal-Mogul who is presently the ultimate parent of all of the other Debtors and who will be the ultimate parent of the Reorganized Debtors after the Petition Date. Creation of the five Subfunds is necessary to account for the five distinct groups of Asbestos Personal Injury Claims to be channeled to the Trust under the Plan, according to Mr. O'Neill. There is absolutely no basis in the statute or in logic for certain objectors' assertion that each Subfund must independently satisfy the Section 524(g) funding requirements, he argues. PepsiAmericas, Mr. O'Neill asserts, lacks standing to raise its objection because the settlement of the Pneumo Protected Parties' claims against the Debtors has no effect on of PepsiAmericas' claims. The Plan's release, exculpation and limitation of liability provisions are in accord with the prevailing standards articulated by the Third Circuit for such provisions, and are comparable to provisions that have been approved time and again by courts in this Circuit as reasonable, Mr. O'Neill maintains. The value of stock warrants is based on the performance of the company and not necessarily on who owns the company, Mr. O'Neill relates in answer to Robert Cleghorn's objection. Cooper Industries, LLC, and Pneumo Abex LLC argue that the injunctive relief provided by Plan A complies with Section 524(g)(4)(A)(ii). The claims against the Pneumo Protected Parties that the Plan proposes to enjoin all involve allegations of the same asbestos liability, they contend. "They all involve the same alleged products, the same alleged misconduct, and the same alleged victims and injuries." Accordingly, the Pneumo Parties assert that they qualify for a Section 524(g) channeling injunction. The Plan Proponents therefore ask the Court to confirm the Debtors' Fourth Amended Plan, as modified. Cooper also asks the Court to preclude PepsiAmericas from presenting testimony on certain topics at the June 18, 2006 plan confirmation hearing. About Federal-Mogul Headquartered in Southfield, Michigan, Federal-Mogul Corporation -- http://www.federal-mogul.com/-- is an automotive parts company with worldwide revenue of some US$6 billion. Federal-Mogul also has operations in Mexico and the Asia Pacific Region, which includes, Malaysia, Australia, China, India, Japan, Korea, and Thailand. The Company filed for chapter 11 protection on Oct. 1, 2001 (Bankr. Del. Case No. 01-10582). Lawrence J. Nyhan Esq., James F. Conlan Esq., and Kevin T. Lantry Esq., at Sidley Austin Brown & Wood, and Laura Davis Jones Esq., at Pachulski, Stang, Ziehl, Young, Jones & Weintraub, P.C., represent the Debtors in their restructuring efforts. When the Debtors filed for protection from their creditors, they listed US$10.15 billion in assets and $8.86 billion in liabilities. Federal-Mogul Corp.'s U.K. affiliate, Turner & Newall, is based at Dudley Hill, Bradford. Peter D. Wolfson, Esq., at Sonnenschein Nath & Rosenthal; and Charlene D. Davis, Esq., Ashley B. Stitzer, Esq., and Eric M. Sutty, Esq., at The Bayard Firm represent the Official Committee of Unsecured Creditors. On March 7, 2003, the Debtors filed their Joint Chapter 11 Plan. They submitted a Disclosure Statement explaining that plan on April 21, 2003. They submitted several amendments and on June 6, 2004, the Bankruptcy Court approved the Third Amended Disclosure Statement for their Third Amended Plan. On July 28, 2004, the District Court approved the Disclosure Statement. The estimation hearing began on June 14, 2005. They then submitted a Fourth Amended Plan and Disclosure Statement on Nov. 21, 2006, and the Bankruptcy Court approved that Disclosure Statement on Feb. 6, 2007. The confirmation hearing is set for June 18, 2007. (Federal-Mogul Bankruptcy News, Issue No. 139; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000). TRUE CORP: Moody's Cuts Corporate Family Rating to B1 from Ba3 -------------------------------------------------------------- Moody's Investors Service downgraded the Corporate family rating of True Corporation Public Company Limited to B1 from Ba3. The outlook on the rating is stable. The rating has been downgraded based on concerns over True Corp's ability to comply with lenders' financial covenants after Sept. 30, 2007. "The operating environment in Thailand continues to be challenging such that the company's financial profile has been constrained, thus causing the company to negotiate covenant waivers with certain of its lenders in respect of its Thai bank syndicated loan. At present, the company has been granted waivers till September 2007," says Laura Acres, a Moody's Vice President. "True Corp's financial metrics continue to be affected by ongoing challenges in executing its business plan in the competitive cellular market. Although there has been some improvement so far this year the company's business remains under material pressure and there remains considerable doubt it will be in a position to satisfy the covenants by September," adds Acres, also Moody's Lead Analyst for the company. Given this uncertainty, Moody's believes a single B rating is more appropriate for the company, reflecting the lack of stability in its capital profile, particularly at a time when there is considerable regulatory uncertainty in Thailand. The outlook is stable since Moody's believes there is a likelihood that -- if a waiver is required -- the banks will grant a further extension in September. It is unlikely that the rating will be upgraded in the near-to-medium term without the company developing clear headroom under its bank covenants. Moody's would also look for outstanding regulatory issues, particularly with regard to the legality of the concession agreements, to be resolved. The most immediate likely drivers of negative rating action are: (1) True Move fails to obtain the necessary approval for the extension of the financial covenant breach under its bank facilities or fails to complete its proposed THB7.9 billion refinancing exercise; and/or (2) True Corp fails to negotiate covenant waivers or amendment on Sept. 30, 2007 for its own bank facilities. Headquartered in Bangkok, Thailand, True Corporation Public Company Limited, formerly known as TelecomAsia, is an integrated provider of fixed line, broadband, internet, mobile services and cable TV (via the UBC acquisition) in Thailand. True Corp is listed on the Thailand Stock Exchange and the Charoen Pokphand Group is the major shareholder with approximately 36% shareholding. Its wireless business is predominantly conducted through its 93.3% owned True Move Company Limited, which is the third largest mobile telecommunications operator in Thailand; and its pay TV business is conducted through its 91.8% owned True Visions Public Company Limited, which is currently the only nationwide provider of pay television services in the country. TRUE MOVE: Moody's Holds Corporate Family Rating at B1 ------------------------------------------------------ Moody's Investors Service affirmed the B1 corporate family rating of True Move Company Limited. At the same time, Moody's has upgraded the rating on the senior unsecured bond rating to B1. Moody's has also changed the outlook on these ratings to stable from negative. The change in outlook reflects True Move's new committed bank facility with DBS bank which will refinance the bulk of its existing Thai bank facilities; certain of the financial covenants for these facilities have been temporarily waived. Moody's remains cognizant of the waivers still in place from all lenders and the fact that such waivers expire on Sept. 30, 2007, however it is understood that the company is making efforts to bring these covenants in line with the refinanced terms. Moody's notes that refinanced loan is fully underwritten and that once drawn down, secured debt/total debt will be less than 15% and therefore, in accordance with Moody's notching guidelines, the senor unsecured bond rating will rank on par with the corporate family rating hence the upgrade in the bond rating. Moody's considers the credit profile of True Move to be highly correlated with that of its parent True Corp, given its operational position within the group -- True Move contributes approximately 43% of consolidated revenues. At the same time, True Corp benefits from the diversity and increasing revenue contribution provided by True Move. True Move's total debt represents approximately 35% of True Corp's group debt. Given the degree of inter-relation between various group entities and the movement of funds between them, Moody's views the 3 core group companies (True Corp, True Move and True Visions) as having the same risk profile. Given the current credit profile of True Corp and True Move, ongoing regulatory uncertainties and the existence of various covenant waivers within the group it is unlikely that the rating will be upgraded in the next 12 to 18 months or until the company is able to demonstrate a sustainable ability to operate within its bank covenants, uncertainties surrounding its concession are resolved or stabilized and there are improvements in its credit metrics. The most immediate likely drivers of negative rating action are: * True Move fails to obtain the necessary approval for the extension of the financial covenant breach under its bank facilities or fails to complete its proposed Bt7.9 billion refinancing exercise; And * True Corp fails to negotiate covenant waivers or amendment on Sept. 30, 2007 for its own bank facilities. Further, True Move ratings could undergo downward pressure if: * Further regulatory actions impact the operating profile of the company; Or * It experiences greater competition and further liberalization -- so that its financial profile is not improving as evidenced for example by adjusted debt/EBITDA ratio increasing much beyond 5x. Headquartered in Bangkok, True Move (formerly TA Orange) is Thailand's third largest mobile operator. It holds a concession until 2013 to operate a 1800-MHz cellular business from CAT Telecom Public Co. Ltd. (state-owned). Its (93%) major shareholder, True Corp, is an integrated provider of fixed-line, broadband, internet, mobile services and pay TV (the latter via its recent acquisition of True Visions (formerly known as UBC). True Move had a market share of 19.3% as of Dec. 31, 2006 and generated revenues of THB23.7 billion (US$722 million). True Corp is listed on the Thailand Stock Exchange and the Charoen Pokphand Group is the major shareholder with an approximate 30.4% shareholding. * BOND PRICING: For the Week 11 June to 15 June 2007 ---------------------------------------------------- Issuer Coupon Maturity Currency Price ------ ------ -------- -------- ----- AUSTRALIA & NEW ZEALAND ----------- Ainsworth Game 8.000% 12/31/09 AUD 0.80 Alinta Networks 5.750% 09/22/10 AUD 6.62 APN News & Media Ltd 7.250% 10/31/08 AUD 5.02 A&R Whitcoulls Group 9.500% 12/15/10 NZD 9.60 Arrow Energy NL 10.000% 03/31/08 AUD 2.73 Babcock & Brown Pty Ltd 8.500% 12/31/49 NZD 8.00 Becton Property Group 9.500% 06/30/10 AUD 0.81 BIL Finance Ltd 8.000% 10/15/07 NZD 9.75 Capital Properties NZ Ltd 8.500% 04/15/07 NZD 8.50 Capital Properties NZ Ltd 8.000% 04/15/10 NZD 9.50 Cardno Limited 9.000% 06/30/08 AUD 5.60 CBH Resources 9.500% 12/16/09 AUD 0.39 Chrome Corporation Ltd 10.000% 02/28/08 AUD 0.02 Clean Seas Tuna Ltd 9.000% 09/30/08 AUD 1.29 Djerriwarrh Investments Ltd 6.500% 09/30/09 AUD 4.57 Evans & Tate Ltd 8.250% 10/29/07 AUD 0.52 Fletcher Building Ltd 8.600% 03/15/08 NZD 9.10 Fletcher Building Ltd 7.800% 03/15/09 NZD 8.75 Fletcher Building Ltd 7.550% 03/15/11 NZD 9.00 Futuris Corporation Ltd 7.000% 12/31/07 AUD 2.50 Geon Group 11.750% 10/15/09 NZD 8.95 Hy-Fi Securities Ltd 7.000% 08/15/08 NZD 9.50 Hy-Fi Securities Ltd 8.750% 08/15/08 NZD 9.75 Hutchison Telecoms Australia 5.500% 07/12/07 AUD 0.65 IMF Australia Ltd 11.500% 06/30/10 AUD 0.80 Infrastructure & Utilities NZ Ltd 8.500% 09/15/13 NZD 8.80 Infratil Ltd 8.500% 11/15/15 NZD 8.20 Kiwi Income Properties Ltd 8.000% 06/30/10 NZD 1.17 Metal Storm 10.000% 09/01/09 AUD 0.14 Minerals Corporation Ltd 10.500% 09/30/07 AUD 0.97 Nuplex Industries Ltd 9.300% 09/15/07 NZD 8.75 Primelife Corporation 10.000% 01/31/08 AUD 1.04 Salomon SB Aust 4.250% 02/01/09 USD 7.58 Sapphire Sec 7.410% 09/20/35 NZD 7.43 Sapphire Sec 9.160% 09/20/35 NZD 9.12 Silver Chef Ltd 10.000% 08/31/08 AUD 1.08 Software of Excellence 7.000% 08/09/07 NZD 2.50 Speirs Group Ltd. 10.000% 06/30/49 NZD 65.00 Structural Systems 11.000% 06/30/07 AUD 1.70 TrustPower Ltd 8.300% 09/15/07 NZD 8.25 TrustPower Ltd 8.300% 12/15/08 NZD 8.30 TrustPower Ltd 8.500% 09/15/12 NZD 8.70 TrustPower Ltd 8.500% 03/15/14 NZD 8.40 CHINA ----- China Tietong 4.600% 08/18/15 CNY 60.00 Jiangxi Investment 4.380% 09/11/21 CNY 56.84 JAPAN ----- Japan Funi Muni Ent 1.700% 10/30/08 JPY 2.31 JNR Settlement 2.200% 02/15/08 JPY 1.68 Nara Prefecture 1.520% 10/31/14 JPY 9.83 KOREA ----- Korea Development Bank 7.350% 01/27/21 KRW 48.85 Korea Development Bank 7.450% 10/31/21 KRW 48.83 Korea Development Bank 7.400% 11/02/21 KRW 48.81 Korea Development Bank 7.310% 11/08/21 KRW 48.77 Korea Development Bank 8.450% 12/15/26 KRW 70.49 Korea Electric Power 7.950% 04/01/96 USD 56.83 MALAYSIA -------- Aliran Ihsan Resources Bhd 5.000% 11/29/11 MYR 0.83 Asian Pac Bhd 4.000% 12/21/07 MYR 0.30 Berjaya Land Bhd 5.000% 12/30/09 MYR 1.08 Bumiputra-Commerce 2.500% 07/17/08 MYR 1.51 Camerlin Group 5.500% 07/15/07 MYR 2.20 Crescendo Corporation Bhd 3.000% 08/25/07 MYR 1.51 Denko Industrial Corp. Bhd 5.000% 03/15/07 MYR 0.69 Eastern & Oriental Hotel 8.000% 07/25/11 MYR 2.86 Eden Enterprises (M) Bhd 2.500% 12/02/07 MYR 0.73 Equine Capital 3.000% 08/26/08 MYR 2.31 EG Industries Bhd 5.000% 06/16/10 MYR 0.60 Greatpac Holdings 2.000% 12/11/08 MYR 0.20 Gula Perak Bhd 6.000% 04/23/08 MYR 0.43 Hong Leong Industries Bhd 4.000% 06/28/07 MYR 0.81 Huat Lai Resources Bhd 5.000% 03/28/10 MYR 0.52 I-Berhad 5.000% 04/30/07 MYR 0.75 Insas Bhd 8.000% 04/19/09 MYR 0.78 Kamdar Group Bhd 3.000% 11/09/09 MYR 0.44 Kosmo Technology Industrial 2.000% 06/23/08 MYR 0.53 Kretam Holdings Bhd 1.000% 08/10/10 MYR 0.96 Kumpulan Jetson 5.000% 11/27/12 MYR 0.68 LBS Bina Group Bhd 4.000% 12/31/07 MYR 0.77 LBS Bina Group Bhd 4.000% 12/31/08 MYR 0.77 LBS Bina Group Bhd 4.000% 12/31/09 MYR 0.77 Media Prima Bhd 2.000% 07/18/08 MYR 1.80 Mithril Bhd 8.000% 04/05/09 MYR 0.24 Mithril Bhd 3.000% 04/05/12 MYR 0.61 Nam Fatt Corporation Bhd 2.000% 06/24/11 MYR 0.66 Pilecon Engineering Bhd 5.000% 12/19/11 MYR 0.29 Pelikan International 3.000% 04/08/10 MYR 1.80 Pelikan International 3.000% 04/08/10 MYR 1.97 Puncak Niaga Holdings Bhd 2.500% 11/18/16 MYR 0.88 Ramunia Holdings 1.000% 12/20/07 MYR 1.09 Rashid Hussain Bhd 3.000% 12/23/12 MYR 1.89 Rashid Hussain Bhd 0.500% 12/24/12 MYR 1.90 Rhythm Consolidated Bhd 5.000% 12/17/08 MYR 0.23 Silver Bird Group Bhd 1.000% 02/15/09 MYR 0.30 Senai-Desaru Exp 3.500% 06/07/19 MYR 74.25 Senai-Desaru Exp 3.500% 12/09/19 MYR 72.87 Senai-Desaru Exp 3.500% 06/09/20 MYR 71.49 Senai-Desaru Exp 3.500% 12/09/20 MYR 70.14 Senai-Desaru Exp 3.500% 06/09/21 MYR 68.77 Southern Steel 5.500% 07/31/08 MYR 1.60 Tenaga Nasional Bhd 3.050% 05/10/09 MYR 1.28 Tradewinds Corp. 2.000% 02/08/12 MYR 1.01 Tradewinds Plantations Bhd 3.000% 02/28/16 MYR 1.10 TRC Synergy Berhad 5.000% 01/20/12 MYR 1.44 WCT Land Bhd 3.000% 08/02/09 MYR 2.48 Wah Seong Corp 3.000% 05/21/12 MYR 5.65 YTL Cement Bhd 4.000% 11/10/15 MYR 2.06 SINGAPORE --------- Sengkang Mall 8.000% 11/20/12 SGD 1.18 ********* Tuesday's edition of the TCR-AP delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR-AP editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Tuesday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR-AP constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR-AP editor holds some position in the issuers' public debt and equity securities about which we report. A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the TCR-AP. Submissions about insolvency-related conferences are encouraged. Send announcements to conferences@bankrupt.com Friday's edition of the TCR-AP features a list of companies with insolvent balance sheets obtained by our editors based on the latest balance sheets publicly available a day prior to publication. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter - Asia Pacific is a daily newsletter co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland, USA. Mark Andre Yapching, Azela Jane Taladua, Rousel Elaine Tumanda, Valerie Udtuhan, Francis James Chicano, Tara Eliza Tecarro, Freya Natasha Fernandez-Dy, Frauline S. Abangan, and Peter A. Chapman, Editors. Copyright 2007. All rights reserved. ISSN: 1520-9482. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. TCR-AP subscription rate is US$625 for 6 months delivered via e- mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are US$25 each. For subscription information, contact Christopher Beard at 240/629-3300. *** End of Transmission ***