/raid1/www/Hosts/bankrupt/TCRAP_Public/070619.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 19, 2007, Vol. 10, No. 120
Headlines
A U S T R A L I A
AEP INDUSTRIES: Earns US$6.2 Mil. in 2nd Quarter Ended April 30
CLEVELAND-CLIFFS: Agrees to Buy PinnOak for US$450 Mil. in Cash
DELTA AIR: Amends Credit Card Processing Agreement
EVANS & TATE: Restructure with ANZ Pushed Through
FORTESCUE METALS: Moody's Reviews Ba3 Debt Rating for Downgrade
GETTY IMAGES: Financial Filing Prompts S&P's Positive Watch
C H I N A & H O N G K O N G
CHINA MINSHENG: Mulls Bond Sale to Raise CNY20 Billion
ENERSYS INC: Reports US$10.6-Mil. Net Income in 2007 4th Quarter
FIAT SPA: To End Joint Venture Witch China's Nanjing Auto
ICBC: May Take Over Huarong Asset; Looks to Form Conglomerate
RIM SEMICONDUCTOR: April 30 Balance Sheet Upside-down by US$1.6M
SANMINA-SCI: Posts US$26.1-Million Net Loss for March Quarter
SHENZHEN DEVELOPMENT: Plans to Raise CNY16 Bil. Via Bonds Issue
TCL MULTIMEDIA: Parent to Issue Shares to Fund LCD Project
TTM TECHNOLOGIES: Debt Reduction Prompts S&P to Revise Outlook
I N D I A
BAUSCH & LOMB: Warburg Pincus Buyout Raises Fears on Outsourcing
BRISTOW GROUP: Completes US$300 Mil. Sr. Notes Private Offering
GENERAL MOTORS: Carlyle & Blackstone In for Final Bid, FT Says
KINETIC ENGINEERING: Engine & Gearbox Unit Win Orders
I N D O N E S I A
ALLIANCE ONE: Restating Results for First Three Quarters of 2007
BANK MANDIRI: Pefindo Assigns "idAA-" Corporate Rating
BEARINGPOINT INC: Hires John Distefano as VP & Exec. Director
HILTON HOTELS: Enters Into Partnership with Moet Hennessy
INCO LTD: Steelworkers Reach Tentative Agreement w/ Contractors
INDOSAT TBK: Moody's Keeps Ba1 Local Currency Issuer Rating
PHILLIPS-VAN: Good Performance Cues S&P's Positive CreditWatch
PERTAMINA: To Take Over Medco Energi's Madura Shares
PERUSAHAAN LISTRIK: Moody's Puts B1 Rating on Proposed USD Bonds
J A P A N
AMAZON.COM: S&P Upgrades Corporate Credit Rating to BB
BOSTON SCIENTIFIC: Court Bars Motion to Disallow Some Claims
GOODWILL GROUP: Welcia and Wisnet Express Interest to Buy Firm
NOVA CORP: Trade Ministry Bans New Contracts with Students
NOVA CORP: Plans to Issue Shares to Gain Back Public Trust
RESONA HOLDINGS: Ties Up with Dai-Ichi to Pay JPY2.3-Bil. Debt
K O R E A
BIOMET INC: LVB Acquisition Commences US$11 Billion Tender Offer
DURA AUTOMOTIVE: Wants to Amend Terms of US$300MM DIP Facility
HYNIX SEMICONDUCTOR: Moody's Lifts Rating on Good Performance
REMY INTERNATIONAL: To File Prepackaged Chapter 11 Protection
M A L A Y S I A
FINISAR CORP: Audit Comm. Completes Initial Stock Grant Review
FINISAR CORP: Reports Preliminary 4th Qtr.& Annual 2007 Results
INTERPUBLIC GROUP: Provides Update on SEC Investigation
LITYAN HOLDINGS: Unit Bags Tenaga's MYR57MM Worth of Contracts
MALAYSIA AIRLINES: Wants More Flight Out of Subang Airport
MEGAN MEDIA: Bank of East Asia Seeks Payment on Unit's Loan
MP TECHNOLOGY: CIMB Appoints Receivers to Units
SOLUTIA INC: Court Sets July 10 Disclosure Statement Hearing
N E W Z E A L A N D
A2 CORP: Incurs NZ$5-Million Operating Loss in FY2007
AIR NEW ZEALAND: Extends Vancouver-Auckland Non-Stop Service
AMERICAN GREETINGS: Moody's Holds Ba1 Rating on Low Growth Rates
TRUSTPOWER LTD: Net Profit Up 20% to NZ$97 Million in FY2007
P H I L I P P I N E S
ACESITE: Annual Stockholders' Meeting Set for June 20
APC GROUP: Clarifies News on PLDT's Acquisition of Philcom
CHIQUITA: Inks Plantation Improvement Pact with Coosemupar
CHIQUITA BRANDS: Europe Sales Volume Down 4% in April-May 2007
DEL MONTE: Earns US$36.7 Million in 4th Quarter Ended April 29
IPVG CORP: Annual Stockholders' Meeting Set for July 26
PHIL. BANK OF COMMS: Posts PHP234.93-Million Net Income for 2006
PHIL. LONG DISTANCE: In Discussions to Acquire Equity in Philcom
SAN MIGUEL: Employees' Pension Fund Brings Holdings to 15.76%
* Moody's Issues Annual Report on the Philippines
S I N G A P O R E
INTERPOOL: Commences Tender Offer for US$230MM of 6% Sr. Notes
LEAR CORP: European Commission Clears US$5.3 Billion Icahn Deal
LEE TUNG: Wind-Up Petition Hearing Set for July 9
NEWENT INVESTMENTS: Placed Under Voluntary Liquidation
PETROLEO BRASILEIRO: In Talks with Producers on Ethanol Price
PETROLEO BRASILEIRO: Mulls Hiring Regasification Vessel
PETROLEO BRASILEIRO: Argentina Fines Firm for Fuel Insufficiency
STATS CHIPPAC: Moody's Lifts Rating to Ba1 on Good Performance
SYSTOME THERAPEUTICS: Accepting Proofs of Debt Until July 16
T H A I L A N D
ASIA HOTEL: Postpones Extraordinary General Shareholders Meeting
BANK OF AYUDHYA: Warrants Exercise Date Set for June 29
COMPASS EAST: Turns Around w/ THB277,394 Net Income for 1st Qtr.
DAIMLERCHRYSLER AG: Elects to Redeem Term Assets of Trust
DAIMLERCHRYSLER: Chrysler to Invest US$450MM in Kenosha Plant
DAIMLERCHRYSLER: Joins GM & Ford in Healthcare Fund, Sources Say
* BOND PRICING: For the Week 11 June to 15 June 2007
- - - - - - - -
=================
A U S T R A L I A
=================
AEP INDUSTRIES: Earns US$6.2 Mil. in 2nd Quarter Ended April 30
---------------------------------------------------------------
AEP Industries Inc. reported financial results for its fiscal
second quarter ended April 30, 2007.
Net sales decreased 3% in the second quarter of fiscal 2007 to
US$187.8 million compared with US$193.3 million in the second
quarter of fiscal 2006, despite a 9% increase in sales volume.
The decrease is primarily the result of a 12% decrease in
average selling prices, driven by lower resin costs. The effect
of foreign exchange on net sales in the 2007 period was a net
positive US$2.6 million, primarily reflecting the impact of the
strengthened Euro.
Net income for the three months ended April 30, 2007, was
US$6.2 million, as compared to US$18.2 million in the second
quarter of 2006.
For the first six months of fiscal 2007, net sales decreased
US$18.9 million or 5% to US$367.1 million compared with
US$386 million in the same period last year. The decrease in
net sales was the result of a 13% selling price decrease
resulting from resin price decreases mitigated by a sales volume
increase of 8% combined with the net positive impact of foreign
exchange of US$5 million, primarily reflecting the impact of the
strengthened Euro.
Net income for the six months ended April 30, 2007 was
US$16.8 million as compared to US$18.4 million in 2006.
Balance Sheet Data and Liquidity
The company ended the first half of fiscal 2007 US$342.3 million
in total assets, US$269 million in total liabilities, and
US$73.3 million in total stockholders' equity as of April 30,
2007.
The company had with a net debt position of US$178.9 million,
compared with US$192.5 million at the end of fiscal 2006.
Working capital amounted to US$102.3 million at April 30, 2007,
compared to US$85.5 million at Oct. 31, 2006. The increase in
working capital of US$16.8 million was substantially due to an
increase in inventories resulting primarily from our increased
investment in raw materials, a decrease in accrued expenses,
primarily from bonus payments accrued at Oct. 31, 2006, and made
in December and January 2007, and a decrease in short term
borrowings of our foreign operations.
The company believes its cash and cash equivalents on hand at
April 30, 2007, and its cash flow from operations, combined with
the availability of funds under its credit facility and credit
lines available to its foreign subsidiaries for local currency
borrowings, will be sufficient to meet its working capital,
capital expenditure and debt service requirements for at least
the next 12 months.
At April 30, 2007, the company had an aggregate of
US$129.7 million available under its various credit facilities.
A full-text copy of the company's second quarter 2007 report is
available for free at http://ResearchArchives.com/t/s?20f9
"We are pleased to note that year-to-date income from continuing
operations improved an impressive US$3.6 million over the prior
year, sales volume increased a substantial 8% and basic earnings
per share from continuing operations increased US$0.59 over the
prior year to US$2.13 per share," stated Brendan Barba, chairman
and chief executive officer of the company.
"Our confidence in and commitment to our company and its future
remains strong and are evidenced by our continuing purchases of
our own stock."
About AEP Industries
AEP Industries Inc. (Nasdaq: AEPI) -- http://www.aepinc.com/--
manufactures and markets plastic packaging films, including
polyethylene, polyvinyl chloride and polypropylene flexible
packaging products for the industrial and agricultural
applications. AEP operates in eight countries in North America,
Europe and Asia Pacific. On Feb. 10, 2005, the company disposed
off AEP Industries Packaging France SAS and on March 25, 2005,
the Group disposed off Termofilm SpA. On Feb. 23, 2006, the
company acquired Mercury Plastics Inc. The company has
operations in Belgium and Australia.
* * *
AEP Industries Inc. carries Moody's Investors Service's Ba3
long-term corporate family rating, B1 senior unsecured debt
rating, and Ba3 probability-of-default rating. The outlook
remains stable.
The company also carries Standard & Poor's B+ long-term foreign
and local issuer credit ratings. The outlook is positive.
CLEVELAND-CLIFFS: Agrees to Buy PinnOak for US$450 Mil. in Cash
---------------------------------------------------------------
Cleveland-Cliffs Inc. has agreed to acquire PinnOak Resources,
LLC, and its subsidiary operating companies, for US$450 million
in cash plus approximately US$150 million in debt.
Payment of 25 percent of the cash portion will be deferred until
Dec. 31, 2009. The transaction is expected to close within 60
days and is subject to regulatory clearances.
"This acquisition represents an attractive expansion opportunity
for our company. When combined with our Australian coking and
thermal coal operation, the Sonoma Project, the company will
control a 10 million ton position, with the majority being for
export," commented Joseph A. Carrabba, Cleveland-Cliffs
chairman, president and chief executive officer. "It marks yet
another step in the execution of our strategy to deepen Cliffs'
exposure to faster growing international markets and further
diversify its mineral sales."
The transaction is expected to increase Cliffs' 2008 revenues by
approximately US$400 million and add approximately US$100
million in EBITDA. Due to customer transition issues, full-year
2007 revenues are expected to be approximately US$300 million.
The transaction will have minimal earnings impact to Cliffs in
2007 as it covers acquisition and integration costs.
"We are excited to welcome the PinnOak team to the Cliffs
organization as they provide a depth of experience and an
additional growth platform consistent with the Company's
strategic objectives," Carrabba added.
PinnOak Projects
PinnOak is a privately owned domestic producer of high-quality,
low-volatile metallurgical coal.
PinnOak's operations include two complexes comprising three
underground mines -- the Pinnacle and Green Ridge mines in
southern West Virginia, and the Oak Grove mine near Birmingham,
Alabama. Combined, the mines have the capacity to produce in
excess of seven million tons of premium-quality metallurgical
coal annually.
The Pinnacle complex, located in Pineville, West Virginia,
comprises the Pinnacle and Green Ridge properties. In operation
since 1969, Pinnacle produces a high-quality, low-volatile
metallurgical coal and boasts the only longwall plow system in
the United States. The Green Ridge mine, opened in 2004, also
produces a premium-quality product. Coal from both mines is
processed by the Pinnacle Preparation Plant and then shipped to
the customer via the Norfolk Southern rail line and exports from
the port of Norfolk, Virginia.
Located in Adger, Alabama, the Oak Grove mine has been in
operation since 1975 producing high-quality, low-volatile, very
low-sulfur product, which is in high demand due to its excellent
coking characteristics. Processing from this mine is done at
the Concord Preparation Plant and product is transported
domestically by rail, barge or truck. International shipments
initiate from the port of Mobile, Alabama.
Approximately 80 percent of PinnOak's total 2007 production is
slated for the international steel market, with the balance
committed to integrated steelmakers in the United States. The
company produced approximately 3.9 million tons of coal in 2006
and has current estimated reserves of 140 million tons.
About Cleveland-Cliffs Inc.
Based in Cleveland, Ohio, Cleveland-Cliffs Inc. (NYSE:
CLF) -- http://www.cleveland-cliffs.com/-- produces iron ore
pellets in North America, and sells the majority of its pellets
to integrated steel companies in North America and Canada. The
company operates six iron ore mines located in Michigan,
Minnesota and Eastern Canada. The company is a majority owner
of Portman Limited, an iron ore mining company in Australia,
serving the Asian iron ore markets with direct-shipping fines
and lump ore.
* * *
Cleveland-Cliffs, Inc.'s preferred stocks carry Moody's Investor
Service's 'B3' rating.
DELTA AIR: Amends Credit Card Processing Agreement
--------------------------------------------------
Delta Air Lines has amended its Visa/MasterCard processing
agreement to eliminate the US$1.1 billion holdback previously
required.
This holdback consisted of an US$800 million cash reserve and a
related US$300 million letter of credit. Pursuant to the
amendment, the entire amount of the cash reserve was returned to
Delta and the letter of credit was terminated. No future
holdback or cash reserve is required except in limited
circumstances.
As a result of these changes, Delta expects to end the quarter
with US$4.2 billion in liquidity, including a fully available,
US$1 billion revolving line of credit.
"This new agreement reflects the strong confidence of the
financial markets in our ability to deliver on our plan's
commitments," said Edward H. Bastian, Delta's executive vice
president and chief financial officer.
The company also updated its June 2007 quarter guidance today,
stating that it expects to achieve operating margins of 11
percent to 12 percent(a). The company affirmed its previous
capacity guidance issued in April 2007, which showed
consolidated domestic capacity reductions of 4 percent to 6
percent, with an associated increase in international capacity
of 14 percent to 16 percent, compared to the June 2006 quarter.
"Our plan remains on track, with our restructuring driving
improvements to both unit revenues and unit costs," Bastian
continued. "In this highly competitive industry, Delta is
uniquely positioned in its ability to reallocate existing assets
to right-size the domestic network and focus on international
growth opportunities."
Delta also filed today a Form 8-K with the Securities and
Exchange Commission that provides additional information about
the amendment to the credit card processing agreement and the
June 2007 quarter guidance.
About Delta Air
Headquartered in Atlanta, Georgia, Delta Air Lines (NYSE:DAL)
-- http://www.delta.com/-- is the world's second-largest
airline in terms of passengers carried and the leading U.S.
carrier across the Atlantic, offering daily flights to 502
destinations in 88 countries on Delta, Song, Delta Shuttle, the
Delta Connection carriers and its worldwide partners. Delta
flies to Argentina, Australia and the United Kingdom, among
others.
* * *
As reported in the Troubled Company Reporter on May 2, 2007,
Standard & Poor's Ratings Services raised its ratings on Delta
Air Lines Inc. (B/Stable/--), including raising the corporate
credit rating to 'B', with a stable outlook, from 'D', following
the airline's emergence from Chapter 11 bankruptcy proceedings.
EVANS & TATE: Restructure with ANZ Pushed Through
-------------------------------------------------
Evans & Tate Limited disclosed with the Australian Stock
Exchange that it has reached an in-principle agreement with its
bank, Australia and New Zealand Bank, and Pendulum Capital Pty
Limited for its financial restructure and that the parties are
now moving to formalize the Restructure Plan by negotiating and
executing legally binding documentation.
The terms of the Restructure Plan are similar to the terms of
the restructure plan announced by ETW to the market on May 10,
2007, excepting:
* ANZ will be partnered by Pendulum representing an investor
group;
* The proposed share purchase plan will be replaced by a
larger capital raising to be offered to shareholders as a
non-renounceable rights issue.
Under the Restructure Plan and following the placement to ANZ,
ETW will undertake a non-renounceable rights issue, fully
underwritten by ANZ and Pendulum, to raise approximately AU$16.7
million at 5 cents per share. The issue will be on a 1 for 2
basis to all shareholders, comprising the restructured equity
base of ETW. Shareholders who take up their entitlement will
receive one free option for every two shares subscribed for.
The options will have a five-year term and be exercisable at any
time at 7.5 cents.
Under the Restructure Plan, relevant ETW security holders will
be invited to meet and asked to approve (in their relevant
classes):
* the issue of 429,645,454 ETW shares in exchange for ANZ
forgiving AU$45 million in principal debt. ANZ will sell
half of these shares to the Pendulum Investor Group for an
undisclosed sum;
* the conversion of the convertible notes into ordinary
shares at a converstion ration of 4.18 ordinary shares for
each note; and
* the conversion of Wines into ordinary shares at a ration of
2 ordinary shares for each Wines.
The effect of the agreement (if completed) will be to reduce
ETW's existing debt to ANZ to approximately AU$55 million.
The proceeds of the rights issue will be used primarily for
working capital, capital works and possibly other strategic
acquisitions. Given that the proceeds of the rights issue will
be used in part for working capital purposes, ETW will no longer
require AU$5 million working capital facility from ANZ. This
means that the ongoing facilities will be approximately AU$55
million rather than the AU$60 million previously announced.
The in principle agreement is subject to the completion of
satisfactory due diligence by ANZ and Pendulum and is not
legally binding on all parties until formal documentation is
executed. The Board of ETW will continue to examine all
alternate offers for the restructure of the company.
Chairman John Hopkins said, "We are pleased that the
restructuring process is progressing. We look forward to
refocusing our attention on the running of a premium wine
business."
Mr. Hopkins also said the ANZ has reaffirmed its current
intention not to withdraw its financial support of ETW and it
will continue to provide financial facilities to enable ETW to
carry on its day-to-day operations.
ETW will request that the trading of its securities be
reinstated by the ASX with immediate effect.
About Evans & Tate
Headquartered in Wembley, Western Australia, Evans & Tate
Limited -- http://www.etw.com.au/-- is an Australian wine
company listed on the Australian Stock Exchange. The primary
businesses of the Evans & Tate Wine Group are the production,
marketing and distribution of a number of branded, exclusive
labeled and unbranded wines; contract winemaking; wine trading;
viticultural services; and wine tourism through its Visitor
Centers.
The Troubled Company Reporter - Asia Pacific reported on
September 15, 2006, that Evans & Tate Limited posted a loss of
AU$63.9 million for the 2005-2006 financial year, down 12% on
the corresponding figure for the previous year.
The TCR-AP report also stated that as of June 30, 2006, the
company's balance sheet revealed strained liquidity with
AU$90.930 billion in total current assets available to pay
AU$152.377 billion of total current liabilities coming due
within the next 12 months. Further, Evans & Tate's June 30,
2006 balance sheet also showed total liabilities of
AU$207.445 billion exceeding total assets of AU$139.792 billion,
resulting to total shareholders' deficit of AU$67.653 billion.
Going Concern
The same TCR-AP report adds that Evans & Tate says that the
financial report has been prepared on a going concern basis,
noting that as at June 30, 2006, certain matters are considered
pertinent when considering the ability of the consolidated
entity to continue as a going concern.
The company notes that if it is unable to continue as a going
concern, it will be required to realize its assets and
extinguish its liabilities other than in the normal course of
business and at amounts that may be different to those stated in
the financial report.
FORTESCUE METALS: Moody's Reviews Ba3 Debt Rating for Downgrade
---------------------------------------------------------------
Moody's Investors Service has put the senior secured Ba3 rating
of FMG Finance Pty Ltd, the financing vehicle for the Fortescue
Metals Group, on review for possible downgrade, following an
announcement that the company is considering a new fund-raising
exercise to expand its iron ore project.
"The review will focus on the funding mix which the company
intends to employ to finance the expansion" said Dr. David
Howell, a VP at Moody's.
"The rating could be maintained at the current level or could
undergo a downgrade, depending on the debt characteristics of
instruments ultimately assumed, the proportion of debt to equity
in the resultant capital structure, and the effect the expansion
plan will have on the project's original timetable," says Dr.
Howell.
"Moody's will also review the progress of the existing project
according to the original budget and timetable," adds Dr.
Howell.
Fortescue Metals Group, based in Perth, is constructing an iron
ore mine, rail and port in Western Australia's Pilbara region.
When completed, the project will produce 45 million tons or iron
ore per annum for export.
About Fortescue Metals
Headquartered in West Perth, Western Australia, Fortescue Metals
Group Limited -- http://fmgl.com.au/-- is involved in the
exploration of iron ore through a project to mine iron ore in
the Chichester Ranges, in the Pilbara region of Western
Australia and exporting it from Port Hedland.
In 2005, Fortescue's chief executive officer, Andrew Forrest,
admitted to a AU$500-million blowout on the cost of port and
rail infrastructure in the Pilbara Project because of price
hikes for steel, fuel, construction materials, and contract
labor. The Company also disclosed that the hampered progress of
the Pilbara Project brings in the possibility that the Company
may not meet its ore delivery schedule and pushes up costs at
resource developments across Western Australia. In May 2005,
the Australian Stock Exchange pressured Fortescue to explain
matters about the project and to explain how the Company would
be able to dispose of its lower grade order for 95% of the price
obtained by rivals BHP Billiton and Rio Tinto for their top-
quality products. The ASX then referred the matter to the
Australian Securities and Investments Commission, which
commenced a legal action against the Company.
The ASIC alleges that Fortescue is engaged in misleading and
deceptive conduct and has failed to comply with its continuous
disclosure obligations when it announced various contracts with
Chinese entities on August 23 and November 5, 2004. In
particular, Fortescue did not disclose that the Chinese parties
had not reached a concluded agreement on fundamental aspects of
the projects and they had merely agreed that they would in the
future jointly develop and agree on the "agreed" matters. The
ASIC is seeking civil penalties of up to AU$3 million against
Fortescue.
* * *
Fortescue reported a net loss for the past two fiscal years.
Net loss for the year ended June 30, 2005, was AU$4.52 million
and net loss for the year ended June 30, 2006, was AU$2.15
million.
In August 2006 Moody's Investors Service assigned a Ba3 rating
to approximately US$1.9 billion in senior secured 144A bonds to
be issued by FMG Finance Pty Ltd, the financing vehicle of the
Fortescue Metal Group. The funding will be used to partially
finance the development of the Company's iron ore mine in the
Pilbara region of Western Australia as well as an associated
rail line and port infrastructure.
GETTY IMAGES: Financial Filing Prompts S&P's Positive Watch
-----------------------------------------------------------
Standard & Poor's Ratings Services said revised its CreditWatch
implications on Getty Images Inc. to positive from developing,
following the company's filing of its SEC 10-Q forms for its
first and third quarters, and its 2006 Form 10-K. The corporate
credit rating on the company remains at 'B+'.
S&P originally placed the ratings on CreditWatch with developing
implications on Dec. 4, 2006, after the company had received
notices from bondholders that the delay of its third-quarter 10-
Q filing constituted an event of default.
"We will resolve the CreditWatch following a discussion with
management and an evaluation of the operating outlook," said
Standard & Poor's credit analyst Tulip Lim.
Headquartered in Seattle, Washington, Getty Images, Inc. --
http://corporate.gettyimages.com/-- creates and distributes
visual content. The company has corporate offices in Australia,
the United Kingdom and Argentina.
================================
C H I N A & H O N G K O N G
================================
CHINA MINSHENG: Mulls Bond Sale to Raise CNY20 Billion
------------------------------------------------------
China Minsheng Banking Corp. plans to sell CNY20 billion
(US$2.6 billion) worth of bonds to boost capital and finance
loan growth, Shanghai Daily reports.
According to the report, the company will raise CNY8 billion
selling three-year fixed-rate bonds and will sell another
CNY12 billion of three-year and five-year floating-rate bonds.
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.
ENERSYS INC: Reports US$10.6-Mil. Net Income in 2007 4th Quarter
----------------------------------------------------------------
EnerSys announced its financial results for the fourth quarter
and full year of fiscal 2007. Net earnings for the fourth
quarter were US$10.6 million, compared to net earnings of
US$11.7 million for the same period in 2006, and exceeds the
previous guidance of US$0.15 to US$0.19 per diluted share
provided on Feb. 7, 2007.
Net sales for the fourth fiscal quarter of 2007 were
US$413.6 million compared to US$353.2 million in the comparable
period of the prior year, or an increase of 17.1%.
Net earnings for fiscal 2007 were US$45.2 million or US$0.97 per
share basic and US$0.95 per share diluted, including a US$0.05
per share favorable impact from two legal settlements, a US$0.04
per share non-recurring tax benefit and a US$0.01 per share
unfavorable impact of legal and professional fees related to a
shelf registration statement and secondary offering, plus an
abandoned acquisition. This compares to net earnings of
US$30.7 million or US$0.66 per basic and diluted share in the
prior fiscal year, which included a US$0.12 per share
unfavorable impact primarily related to restructuring
activities. Excluding the highlighted charges and credits,
adjusted net earnings for fiscal 2007 were US$41.4 million or
US$0.89 per basic and US$0.87 per diluted share, compared to
adjusted net earnings for fiscal year 2006 of US$36.6 million or
US$0.79 per basic and US$0.78 per diluted share.
Net sales for fiscal 2007 were US$1,504.5 million compared to
US$1,283.3 million in the prior year, or an increase of 17.2%.
"High commodity costs continue to impact our business. In spite
of these costs, we have been able to continue to grow our
revenues and sustain our earnings. We believe that the
combination of our product quality and the high level of service
we offer to our customers represents the best value in our
industry and has allowed us to increase our selling prices to
largely offset these costs. In addition, we continue to derive
benefit from our cost reduction programs," stated John D. Craig,
chairman, president and chief executive officer. Mr. Craig
added, "We anticipate that adjusted diluted net earnings per
share for our first quarter of fiscal 2008 will be between
US$0.24 and US$0.28, which excludes the expected charge of US$10
million or approximately US$0.14 per share from our European
restructuring actions as described in our press release of
May 23, 2007."
EnerSys Inc. -- http://www.enersys.com/-- (NYSE: ENS)
manufactures industrial battery through 21 manufacturing and
assembly facilities worldwide. Headquartered in Reading,
Pennsylvania, the company is uniquely positioned to provide
expertise in designing, building, installing and maintaining a
comprehensive stored energy solution for industrial applications
throughout the world. The company's products and services are
focused on two primary markets: Motive Power (North & South
America) or (Europe) and Reserve Power (Worldwide), (Aerospace &
Defense) or (Speciality Batteries). The company's facilities
are located at China, France, Mexico, Germany, and the United
Kingdom, among others.
* * *
As reported in the Troubled Company Reporter-Latin America on
May 21, 2007, Standard & Poor's Ratings Services revised its
outlook on industrial battery manufacturer EnerSys to stable
from negative. Standard & Poor's also affirmed all its ratings
on the company, including its 'BB' corporate credit rating.
FIAT SPA: To End Joint Venture Witch China's Nanjing Auto
---------------------------------------------------------
Fiat Spa appears certain to terminate its joint venture
partnership with Nanjing Automobile Corp. after the Chinese
company failed to make its promised investment in the project,
Xinhuanet News says, citing a report from the Shanghai
Securities News.
Xinhuanet quotes Fiat China President Franco Amadei as saying:
"The delayed reciprocal investment and inaction by NAC has been
intolerable to Fiat."
Fiat Chief Executive Officer Sergio Marchionne also said Fiat
will no longer put new models into production at Nanjing Fiat, a
joint venture established in 1999 between NAC and Fiat. Fiat
will also quit from the joint venture's management team,
Mr. Marchionne told the Shanghai Securities.
Xinhuanet recounts that Fiat had planned to invest
EUR500 million in the joint venture over five years in a drive
toward meeting the company's 2010 sales goal of 300,000 vehicles
in China.
However, Nanjing Fiat sold only 30,668 vehicles last year and
NAC has no plans for additional investment in the Fiat joint
venture as it concentrates in developing auto brands it owns,
the report says.
In addition, Fiat had also decided not to let Nanjing Fiat
produce the D200 sedan and would "make separate arrangements"
for production of the Alfa Romeo in China.
The Troubled Company Reporter - Asia Pacific reported on
June 15, 2007, that Fiat Spa and China's Chery Automobile were
considering setting up a joint venture in China to manufacture
Fiat vehicles, specifically the Alfa Romeo sedan.
About Fiat S.p.A.
Headquartered in Turin, Italy, Fiat S.p.A. --
http://www.fiatgroup.com/-- manufactures and sells automobiles,
commercial vehicles, and agricultural and construction
equipment. It also manufactures, for use by the company's
automotive sectors and for sale to third parties, other
automotive-related products and systems, principally power
trains (engines and transmissions), components, metallurgical
products and production systems. Fiat's creditors include Banca
Intesa, Banca Monte dei Paschi di Siena, Banca Nazionale del
Lavoro, Capitalia, Sanpaolo IMI, and UniCredito Italiano.
Fiat operates in Argentina, Australia, Austria, Belgium, Brazil,
Bulgaria, China, Czech Republic, Denmark, France, Germany,
Greece, Hungary, India, Ireland, Italy, Japan, Lituania,
Netherlands, Poland, Portugal, Romania, Russia, Singapore,
Spain, among others.
* * *
Standard & Poor's Ratings Services raised its long-term
corporate credit rating on Italian industrial group Fiat S.p.A.
to BB+ from BB. At the same time, Standard & Poor's affirmed
its 'B' short-term rating on Fiat. S&P said the outlook is
stable.
The company carries Fitch Ratings' Issuer Default rating and
senior unsecured rating at BB-. The Short-term rating is
affirmed at B. Around EUR6 billion of debt is affected by this
rating action.
In addition, Fiat Spa also carries Moody's Investors Services
Ba3 Corporate Family Rating with positive outlook. The long-
term senior unsecured ratings as well as the short-term non-
Prime rating also remains.
ICBC: May Take Over Huarong Asset; Looks to Form Conglomerate
-------------------------------------------------------------
The Industrial and Commercial Bank of China may take over
Huarong Asset Management Corp. as part of efforts to form a
financial conglomerate, Reuters reports, citing the China
Securities Journal.
According to the report, the bank may take a controlling stake
or purchase Huarong outright.
The bank, according to the Shanghai Daily, is expanding into
securities, leasing and other financial services. Senior
management of ICBC and Huarong are exploring new ways to
cooperate, the report adds.
Huarong was set up in 1999 to help dispose of non-performing
assets that ICBC had accumulated over decades in its role as a
key policy bank. Huarong remained a major institutional
investor in the bank.
The bank's president, Yang Kaisheng, was the president of
Huarong from 1999 to 2004.
The Industrial and Commercial Bank of China --
http://www.icbc.com.cn/-- is the largest state-owned commercial
bank, and is authorized by the State Council and the People's
Bank of China. ICBC conducts operations across China as well as
in major international financial centers.
On Sept. 18, 2006, the Troubled Company Reporter - Asia Pacific
reported that Fitch Ratings affirmed ICBC's Individual D/E
rating.
Moody's Investors Service upgraded on December 6, 2006, to D-
from E+ the Bank Financial Strength Rating for Industrial and
Commercial Bank of China. The D- BFSR has a stable outlook.
The upgrade concludes a review of ICBC's BFSR started on
August 9, 2006.
RIM SEMICONDUCTOR: April 30 Balance Sheet Upside-down by US$1.6M
----------------------------------------------------------------
Rim Semiconductor Company's balance sheet at April 30, 2007,
showed US$7,058,491 in total assets and US$8,705,387 in total
liabilities, resulting in a US$1,646,896 total stockholders'
deficit.
The company's balance sheet at April 30, 2007, also showed
strained liquidity with US$450,317 in total current assets
available to pay US$8,702,647 in total current liabilities.
Rim Semiconductor Company reported a net loss of US$121,819 for
the second quarter ended April 30, 2007, compared with a net
loss of US$9,676,846 for the same period ended April 30, 2006.
The company had no revenues for the three months ended April 30,
2007. Revenues for the three months ended April 30, 2006, were
US$18,698 and were entirely from the entertainment business.
The decrease in net loss is primarily due to the decrease in
interest expense, the gain on the change in fair value of
derivative liabilities, and the decrease in amortization of
deferred financing costs. In addition, the company recorded a
loss on exchange of notes payable into common stock of
US$446,386 in the second quarter of 2006, absent in 2007.
Total operating expenses increased 1% or US$26,295 to
US$1,840,388 for the three months ended April 30, 2007, from
US$1,814,093 for the three months ended April 30, 2006.
Interest expense decreased 98% or US$6,498,797 to US$154,016 for
the three months ended April 30, 2007, from US$6,652,813 for the
three months ended April 30, 2006. The decreases are primarily
due to the value allocated to the warrants related to the 2006
Debentures for the three months ended April 30, 2006, that did
not occur in 2007, offset by an increase in amortization and
write-off of debt discount due to increased conversions of
convertible debentures during the three months April 30, 2007,
as compared to the three months ended April 30, 2006.
The company also recognized a gain of US$1,900,394 on the change
in fair value of derivative liabilities for the three months
ended April 30, 2007, a change of US$2,360,794 or 513% from
US$460,400 for the three months ended April 30, 2006. The gain
was due primarily to a decrease in the market price of common
stock during the three months ended April 30, 2007, as compared
to three months ended April 30, 2006.
The amortization of deferred financing costs decreased 87% or
US$283,691 to US$41,161 for the three months ended April 30,
2007, from US$324,852 for the three months ended April 30, 2006.
Other expenses were also higher during the three months ended
April 30, 2006, due to the loss recognized on exchange of notes
payable into common stock of US$446,386.
Full-text copies of the company's consolidated financial
statements for the quarter ended April 30, 2007, are available
for free at http://researcharchives.com/t/s?20ff
About Rim Semiconductor
Headquartered in Portland, Oregon, Rim Semiconductor Company
(OTC BB: RSMI.OB) -- http://www.rimsemi.com/-- develops
technology for telecommunications companies to deliver demanding
new video and data services with lower network costs. The
company's products allow data to be transmitted at greater speed
and across extended distances over existing copper wire-all with
the highest quality of service-for a better end-user experience.
The company has operations in China, Hong Kong and Taiwan.
SANMINA-SCI: Posts US$26.1-Million Net Loss for March Quarter
-------------------------------------------------------------
Sanmina-SCI Corporation reported a net loss of US$26.1 million
for the second quarter ended March 31, 2007, compared with a net
loss of US$76.1 million for the same period ended April 1, 2006.
Sanmina-SCI reported revenue of US$2.61 billion, modestly down
from US$2.67 billion reported in the second quarter of fiscal
2006 ended April 1, 2006.
Operating income was US$14.7 million, compared to
US$44.4 million in in the same period a year ago. Gross profit
was US$137.7 million, compared to US$164.6 million in the 2006
quarter.
On a non-GAAP basis, which exclude charges or gains relating to
stock-based compensation expenses, restructuring costs,
integration costs, impairment charges for goodwill and
intangible assets, amortization expense and other infrequent or
unusual items, net income for the second fiscal quarter of 2007
was US$793 thousand, compared to net income of US$30.5 million
in the 2006 quarter. Operating income was US$40.2 million or
1.5% of revenue, compared to US$66.3 million, or 2.5% of revenue
in the same period a year ago. Gross profit was
US$139.2 million or 5.3% of revenue, compared to
US$164.8 million, or 6.2% in the 2006 quarter.
Sanmina-SCI Corporation uses these non-GAAP measures to gauge
the company's core financial and operating performance. This is
accomplished by eliminating certain financial items that are of
a non-recurring, unusual or infrequent nature or are not related
to the company's regular, ongoing business.
Cash flow provided by operations was US$124.0 million for the
quarter ended March 31, 2007.
At March 31, 2007, the company reported US$664.1 million in cash
and cash equivalents.
"As previously announced, our second quarter revenues were below
expectations. While the second quarter has historically been a
seasonally weak quarter for us, profitability was further
impacted by an unfavorable product-mix with a higher than
anticipated decline in demand from the communications and high-
end computing markets. Demand in the third quarter continues to
be weaker than traditional levels, but we do see signs of
improvement that should contribute positively in the second half
of the calendar year," stated Jure Sola, chairman and chief
executive officer.
About Sanmina-SCI
Sanmina-SCI Corporation (NASDAQ: SANM) -- http://sanmina-
sci.com/ -- is an electronics contract manufacturer serving the
fastest-growing segments of the global electronics manufacturing
services (EMS) market. Sanmina-SCI provides end-to-end
manufacturing solutions to large OEMs primarily in the
communications, defense and aerospace, industrial and medical
instrumentation, computer technology and multimedia sectors.
Sanmina-SCI has facilities strategically located in key regions
throughout the world.
The company has locations in Brazil, China, Finland, Malaysia,
Mexico and Singapore, among others.
* * *
As reported in the Troubled Company Reporter on June 8, 2007,
Standard & Poor's Ratings Services assigned its 'B+' senior
unsecured debt rating to Sanmina-SCI Corp.'s US$600 million in
floating-rate notes, US$300 million of which mature in 2010 and
US$300 million of which mature in 2014.
SHENZHEN DEVELOPMENT: Plans to Raise CNY16 Bil. Via Bonds Issue
---------------------------------------------------------------
Shenzhen Development Bank plans to issue subordinated and hybrid
bonds to raise up to CNY16 billion to boost its capital, Reuters
reports.
According to the report, the yuan-denominated subordinated bond
will carry a maturity period of between 5 and 15 years in the
domestic interbank market to raise CNY8 billion and will issue a
hybrid bond with the same maturity as its subordinated bond to
raise another CNY8 billion to boost its capital adequacy ratio.
The bank's capital adequacy ratio was just 3.71% at the end of
2006, below the minimum regulatory requirement of 8%, various
reports relate.
The bond issuances were already approved by the bank's board but
still need shareholders' votes and regulatory approval, reports
add.
Based in Shenzhen, Guangdong, People's Republic of China,
Shenzhen Development Bank Company Ltd's --
http://www.sdb.com.cn/-- provides local and foreign currency
deposits and loan services. Other activities include foreign
currencies exchanging, foreign currency deposit and remittances,
acts as an agent for issuing foreign currency value-bearing
securities, management of letters of credit and operation of
both an international and a domestic discounting service.
The Troubled Company Reporter - Asia Pacific reported that Fitch
Ratings, on August 14, 2006, affirmed Shenzhen Development
Bank's individual 'D/E' and support '4' ratings.
TCL MULTIMEDIA: Parent to Issue Shares to Fund LCD Project
----------------------------------------------------------
Shenzhen-listed TCL Corp, parent of Hong Kong-listed TCL
Multimedia Technology Holdings, plans to issue 600 million A
shares to raise up to CNY2.3 billion to fund its unit's
production liquid crystal display panels project, reports say.
According to Reuters, the parent will issue the local currency
A-shares in a private placement to 10 institutional investors
where most of the proceeds go towards TCL Multimedia as well as
increasing its regular working capital.
The Standard relates that around CNY650 million will be injected
into TCL Multimedia, and around CNY250 million of the proceeds
will be used to increase the parent's working capital.
The planned issue was approved by the parent's board of
directors but still needed shareholders' votes, reports say.
The issuance will also be subject to approval from Chinese
securities regulator.
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.
TTM TECHNOLOGIES: Debt Reduction Prompts S&P to Revise Outlook
--------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Santa
Ana, California-based TTM Technologies Inc. to stable from
negative, following rapid reduction of debt incurred to acquire
the printed circuit board business from Tyco International.
The 'BB-' corporate credit rating was affirmed, as was the 'BB'
issue rating on TTM's secured debt. The recovery rating of '2'
on TTM's secured debt, which indicates the expectation for
substantial (70%-90%) recovery in the event of a payment
default, remains unchanged.
"The 'BB-' corporate credit rating reflects challenges
associated with very difficult industry conditions for TTM's PCB
products and a highly competitive environment, partially offset
by TTM's niche position as a manufacturer of both quick-turn and
high-volume printed circuit boards and light leverage for the
rating," said Standard & Poor's credit analyst Lucy Patricola.
The U.S.-based PCB industry has experienced a significant
contraction as production has migrated to low cost regions.
Currently, about 10% of the global market for PCB revenue is
produced in the U.S., with a focus on high complexity, low
volume production, prototype boards, and PCBs used in military
applications.
Following its acquisition of the Tyco business, TTM is the
largest U.S.-based manufacturer, with a respectable market
presence in defense, computing, and communications. Despite
TTM's leading market share, the industry remains fragmented,
with hundreds of small manufacturers.
The company, prior to the Tyco acquisition, has experienced some
volatility in profitability. Over the last eight quarters,
EBITDA margin has fluctuated between 15% and 20%. In 2005,
margin slippage was caused by pricing pressure. More recently,
the mix shift to lower margin commercial assembly and a bias to
lower layer boards has impacted margin. The Tyco business has
historically been more stable, because of its strong presence in
defense markets. S&P expects the company to continue to
experience modest cyclicality, given the negotiating strength of
its customer base.
The company has a manufacturing operation in China.
=========
I N D I A
=========
BAUSCH & LOMB: Warburg Pincus Buyout Raises Fears on Outsourcing
----------------------------------------------------------------
In an effort to get out of the public spotlight after federal
regulators identified Bausch & Lomb lens cleaner ReNu with
MoistureLoc as the alleged root cause of a potentially blinding
fungal infection, the company has accepted a US$4.5 billion bid
from New York City-based private equity player Warburg Pincus.
Bausch & Lomb is one of the largest employers in Rochester, New
York, and has been at the forefront in that city in
demonstrating a commitment to workplace diversity and creating
jobs with quality benefits, thus the buyout raises concerns
about possible layoffs or moving manufacturing jobs out of the
area or offshore.
Warburg Pincus' connections and history give rise to these
concerns. The firm is a major investor in India and China, and
has a majority stake in WNS, the largest offshore business
process company in India. In 2002, after acquiring the Town and
Country Assistance, a U.K. insurance claims management company,
WNS moved some of the claims processing and network maintenance
work to India.
In defense of that move, Warburg Pincus executive Wolfe Strouse
told a Wharton interviewer, "We have seen tremendous
efficiencies from both the technology enablement and also from
the highly skilled labor in India ... I think you will see more
such arrangements, where control and strategic level remains
with the customer but the processing piece moves offshore."
The private equity buyout industry, armed with more than a
Half trillion dollars of capital, is engineering financial deals
that together are larger than the annual budgets of most of the
world's countries. This financial juggernaut is generating
hefty returns to its investors, extraordinary riches for its
executives, and newly relevant questions about the impact of its
business practices on American workers, businesses, communities,
and the nation.
The Service Employees International Union has released a set of
principles designed to address the concerns of investors, the
public, and workers including:
-- The buyout industry should play by the same set of rules
as everyone else, including providing transparency and
disclosure about their businesses, supporting equitable
tax rates, and eliminating conflicts of interest and other
potential abuses in their transactions;
-- Workers should have a voice in the deals and benefit from
their outcome; and
-- Community stakeholders, including consumer organizations
and the public, should have a voice in the deals and
benefit from their outcome.
SEIU members participate in pension funds with more than US$1
trillion in assets, most of which invest 5 percent to 10 percent
of their assets in private equity. SEIU is a longtime advocate
of responsible corporate governance practices and an active
member of the Council of Institutional Investors, an
organization of more than 130 pension funds whose assets exceed
US$3 trillion.
About Bausch & Lomb
Headquartered in Rochester, New York, Bausch & Lomb Inc. (NYSE:
BOL) -- http://www.bausch.com/-- develops, manufactures, and
markets eye health products, including contact lenses, contact
lens care solutions, and ophthalmic surgical and pharmaceutical
products. The company is organized into three geographic
segments: the Americas; Europe, Middle East, and Africa; and
Asia (including operations in India, Australia, China, Hong
Kong, Japan, Korea, Malaysia, the Philippines, Singapore, Taiwan
and Thailand). In Latin America, the company has operations in
Brazil and Mexico.
Rating Agencies Take Action
As reported in the Troubled Company Reporter on May 28, 2007,
the Warburg Pincus Deal prompted Standard & Poor's Ratings
Services to lower its ratings on Bausch & Lomb and placed them
on CreditWatch with negative implications. Among others, S&P
lowered the company's corporate credit rating to 'BB+' from
'BBB'.
According to S&P, even if the transaction is not consummated,
management's willingness to aggressively increase leverage to
this extent is not commensurate with an investment-grade rating.
Additionally, Moody's Investors Service said it will continue
its review of Bausch & Lomb's ratings for possible downgrade,
including the company's Ba1 Corporate Family rating.
Sidney Matti, an analyst at Moody's, stated that, "The review
for possible downgrade will focus primarily on the company's
post-acquisition capital structure and the likelihood that BOL's
post-acquisition credit metrics would fall below the 'Ba' rating
category."
Furthermore, Fitch maintained its Negative Rating Watch on
Bausch & Lomb emphasizing that the transaction would
significantly increase leverage and likely result in a multiple-
notch downgrade.
Fitch also warns that the transaction would result in an Issuer
Default Rating of no higher than 'BB-'.
BRISTOW GROUP: Completes US$300 Mil. Sr. Notes Private Offering
---------------------------------------------------------------
Bristow Group Inc. has closed its private offering of US$300
million of senior notes due 2017. The notes priced at par and
will carry an interest rate of 7-1/2%.
The company intends to use the net proceeds from the offering to
fund additional aircraft purchases under options and for general
corporate purposes. Interest is payable on March 15 and
September 15, beginning Sept. 15, 2007.
The notes will not initially be registered under the Securities
Act of 1933 or the securities laws of any state and may not be
offered or sold in the United States absent registration or an
applicable exemption from the registration requirements under
the Securities Act and applicable state securities laws. The
notes may be resold by the initial purchasers pursuant to Rule
144A and Regulation S under the Securities Act.
Headquartered in Houston, Texas, Bristow Group, Inc. --
http://www.bristowgroup.com-- (NYSE:BRS), fka Offshore
Logistics, Inc., provides helicopter transportation services to
the worldwide offshore oil and gas industry with operations in
the United States Gulf of Mexico and the North Sea. The company
also has operations, both directly and indirectly, in offshore
oil and gas producing regions of the world, including Australia,
Brazil, China, India, Mexico, Nigeria, Russia and Trinidad. The
company also provides production management services for oil and
gas production facilities in the United States Gulf of Mexico.
* * *
As reported in the Troubled Company Reporter on June 6, 2007,
Standard & Poor's Ratings Services assigned its 'BB' rating to
helicopter service company Bristow Group Inc.'s US$250 million
senior notes due 2017. At the same time, Standard & Poor's
affirmed the 'BB' corporate credit rating and all other ratings
on the company. The outlook is negative.
GENERAL MOTORS: Carlyle & Blackstone In for Final Bid, FT Says
--------------------------------------------------------------
General Motors Corp. received final bids from two parties for
its Allison Transmission business last week, including the
Carlyle Group, The Financial Times reports citing sources
familiar with the process.
A spokesperson for GM denied the claim stating that there is
more than one bidder left, FT says.
Blackstone was competing with Carlyle in the final bidding
round, a source close to the United Auto Workers was cited by
FT as saying.
The UAW has not yet approved any deal to sell Allison, a
source close to the union further told FT.
According to FT, a spokesperson for Blackstone declined
to comment while UAW officials could not be reached for
comment.
Last month, GM disclosed in a regulatory filing with the
Securities and Exchange Commission that it is considering
measures to strengthen liquidity and focus on its core
business of designing, manufacturing, and selling cars and
light trucks globally.
Among other items, GM said it is currently discussing the
potential sale of its Allison Transmission business with a
number of potential buyers.
GM management believes that a sale of Allison Transmission
is probable, subject to union, regulatory, and other
approvals.
GM provided unaudited pro forma financial information
reflecting Allison Transmission's assets and liabilities
as held for sale as of March 31, 2007, and reporting its \
operations as discontinued for the three months ended
March 31, 2007 and 2006, and for the years ended
Dec. 31, 2006, 2005, and 2004.
A full-text copy of the pro forma financial information is
available for free at http://researcharchives.com/t/s?2038
General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- the
world's largest automaker, has been the global industry sales
leader since 1931. Founded in 1908, GM employs about 317,000
people around the world. It has manufacturing operations in 32
countries.
General Motors has Asia-Pacific operations in India, China,
Indonesia, Japan, the Philippines, among others. It has
locations in European countries including Belgium, Austria, and
France. In Latin-America, the company maintains locations in
Argentina, Brazil, Chile, Colombia, Ecuador, Venezuela, Paraguay
and Uruguay.
* * *
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.
The rating outlook remains negative.
As reported in the Troubled Company Reporter on May 25, 2007,
Fitch Ratings downgraded General Motors Corporation's ratings
including the company's 'B/RR4' rated senior unsecured debt to
'B-/RR5'. GM's Issuer Default Rating remains at 'B' and is
still on Fitch's Negative Rating Watch.
KINETIC ENGINEERING: Engine & Gearbox Unit Win Orders
-----------------------------------------------------
Kinetic Engineering Ltd's engine and gearbox manufacturing unit
has bagged orders from automobile companies, including from Tata
Motors and Force Motors, reports say.
The company won an order to supply gearboxes for the forthcoming
Tata Motors' panel van and Force Motors' Minidoor and Mini 4-
door three-wheeler, moneycontrol.com relates citing Kinetic
Engineering Joint Managing Director Sulajja Firodia Motwani.
The company also reportedly received an export order to supply
50 cc engines to a Holland-based moped company to the tune of
INR25 crore with annual export shipment of 30,000 engines.
According to moneycontrol, Kinetic Engineering, besides coming
up with engines and gearbox for the automotive industry, has
also developed a petrol engine for the three-wheeler market.
Currently, the company is negotiating with several domestic
players for possible new orders, moneycontrol adds.
Reports of the orders surged the company's shares, the Business
Standard says.
India-based Kinetic Engineering Ltd. --
http://www.kineticindia.com/-- is an automobile manufacturer,
which specializes in two wheelers. The company has sold over 6
million vehicles in India. Kinetic has brought to India
technologies, such as four valve engines, electric start on
scooters and motorcycles, v-twin engines and upside down (USD)
forks. The company offers top-end bikes, such as Comet and
Aquila. It has a nationwide network of nearly 450 dealers and
over 1,000 service centers. Kinetic exports vehicles to the
United States, Canada, Latin America, Europe, Africa, Middle
East and South Asia.
The Troubled Company Reporter - Asia Pacific reported on
June 15, 2007, that the company has a stockholders' equity
deficit of US$5.40 million.
=================
I N D O N E S I A
=================
ALLIANCE ONE: Restating Results for First Three Quarters of 2007
----------------------------------------------------------------
Alliance One International Inc. is restating the first three
quarters of results for fiscal year 2007 to correct a cumulative
understatement of income tax expense.
For the quarter ended June 30, 2006, the two quarters ended
Sept. 30, 2006, and the three quarters ended Dec. 31, 2006, the
cumulative understatements are US$1.5 million, US$4 million and
US$8.7 million, respectively. The cumulative understatement
during these unaudited quarters, which management identified,
has not increased the company's total expected cash taxes, and
as such will not have any net effect on liquidity. The company
plans to amend and restate its quarterly reports on Form 10-Q
for each of these periods, and to file its annual report on Form
10-K for fiscal year 2007 as soon as practicable.
The audit committee of the company's board of directors, upon
the recommendation of the company's management, has concluded
that the previously issued financial statements for the first
three quarters of fiscal year 2007 should no longer be relied
upon. The company is currently evaluating but anticipates that
the errors constitute a material weakness or weaknesses in the
company's internal controls over financial reporting.
Separately, the company is expecting to exceed its previous
underlying earnings guidance of US$0.25 to US$0.32 per share for
the fiscal year ended March 31, 2007.
About Alliance One
Based in Morrisville, North Carolina, Alliance One
International, Inc. (NYSE:AOI) -- http://www.aointl.com/-- is a
leaf tobacco merchant. The company has worldwide operations,
including those in Indonesia, Argentina, Brazil, Bulgaria,
Canada, China, France, India, Philippines, Malaysia, and
Singapore.
* * *
The Troubled Company Reporter - Asia Pacific reported on
Sept. 29, 2006, that in connection with Moody's Investors
Service's implementation of its new Probability-of-Default and
Loss-Given-Default rating methodology for the US Consumer
Products, Beverage, Toy, Natural Product Processors, Packaged
Food Processors and Agricultural Cooperative sectors, the rating
agency confirmed its B2 Corporate Family Rating for Alliance One
International, Inc., and upgraded its B2 rating on the company's
US$300 million senior secured revolver to B1. In addition,
Moody's assigned an LGD3 rating to notes, suggesting note
holders will experience a 37% loss in the event of a default.
BANK MANDIRI: Pefindo Assigns "idAA-" Corporate Rating
------------------------------------------------------
Pefindo assigned a corporate rating of "idAA-" with a "stable"
outlook to PT Bank Mandiri (Persero) Tbk. The rating reflects
strong supports from the government, the Bank's superior market
position as the largest bank in the country, and the Bank's
sound capitalization. However, the Bank's high non performing
loans although it showed an improving trend still mitigated the
rating. BMRI was incorporated in 1998 through a merger of 4
state owned banks namely Bank Bumi Daya, Bank Dagang Negara,
Bank Exim, and Bapindo.
As a universal bank, BMRI provides an extensive range of
products and services from commercial banking to investment
banking and insurance. In commercial banking services, the Bank
offers varieties of products that include, among others, lending
and deposits, cash management, foreign exchange and custodial
services, as well as debit and credit cards.
BMRI also has several subsidiaries, which focuses in investment
banking (PT Mandiri Sekuritas), sharia banking (PT Bank Syariah
Mandiri), and insurance (PT AXA Mandiri Insurance).
BMRI's network coverage is regarded as one of the strongest in
the country, comprising of 924 offices and 2,800 self owned ATM
as of December 2006. The Bank ATM's is also incorporated with
around 6,265 units of ATM Link, which are located all over
Indonesia. The Bank currently employs about 21,000 staffs to
provide banking services to its almost 6 million customers.
About Bank Mandiri
PT Bank Mandiri -- http://www.bankmandiri.co.id/-- is
Indonesia's largest and best capitalized bank in terms of
assets, loans and deposits, and provides comprehensive financial
services to more than six million corporate and individual
consumers, as well as small and medium-sized enterprises in
Indonesia.
The Troubled Company Reporter - Asia Pacific reported on May 8,
2007, that Moody's Investors Service revised some ratings of
Indonesia's Bank Mandiri as part of the application of the
agency's refined joint default analysis and updated bank
financial strength rating methodologies. The specific ratings
changes are:
* BFSR is changed to D- from E+.
-- This action also concludes a review for possible
upgrade on the BFSR initiated on August 1, 2006.
* Foreign Currency Deposit Ratings are unchanged at B2/Not
Prime.
* Foreign Currency Debt Rating for senior and subordinated
obligations is unchanged at Ba3
-- Foreign Currency Deposit and Foreign Currency Debt
Ratings have positive outlooks in line with the outlook
on the country's sovereign ratings outlook
The bank also carries Fitch Ratings: Long- term foreign and
local currency Issuer Default ratings at 'BB-', Short-term
rating at 'B', National Long-term rating at AA(idn)', Individual
at 'D', and Support at '4'. The Outlook for the ratings was
revised to Positive from Stable.
BEARINGPOINT INC: Hires John Distefano as VP & Exec. Director
-------------------------------------------------------------
BearingPoint, Inc., has appointed John C. Distefano as vice
president and executive director of healthcare payer services in
the firm's global Healthcare practice.
Mr. Distefano brings more than 26 years of experience to
BearingPoint and will be responsible for overseeing the growth
of BearingPoint's health payer practice, which focuses on
assisting U.S. health plans with improving healthcare quality
and affordability through improved business performance.
Mr. Distefano was most recently a partner and member of
Accenture's healthcare payer industry executive leadership team,
where he was responsible for leading the company's information
technology solutions for its healthcare payer business. Mr.
Distefano's experience also includes more than 13 years of
healthcare payer business transformation and technology services
at Ernst & Young and CapGemini.
He has served as a columnist and contributor for prominent
industry publications. He co-authored the book, "Enterprise
Wireless Application Architecture," and served as executive
editor of the book, "Gaining Business Value from Mobile
Technologies."
"I've worked with John previously in my career and have always
admired his unflagging commitment to client service," said Tuck
Crocker, vice president and head of BearingPoint's commercial
healthcare practice. "We are excited to add his extensive
experience to our rapidly-growing team."
"I'm very excited to join BearingPoint, and look forward to
helping healthcare payer clients enhance core business
operations and improve the execution of technology delivery,"
said Mr. Distefano. "BearingPoint is committed to assisting
clients in solving business and technology challenges and I
believe this uniquely positions us to deliver superior business
performance to our clients."
About BearingPoint
Headquartered in McLean, Virginia, BearingPoint, Inc., (NYSE:
BE) -- http://www.BearingPoint.com/-- provides of management
and technology consulting services to Global 2000 companies and
government organizations in 60 countries worldwide. The firm
has approximately 17,500 employees, and major practice areas
focusing on the Public Services, Financial Services and
Commercial Services markets.
BearingPoint has global locations including in Indonesia,
Australia, Austria, China, India, Japan, Mexico, Portugal,
Singapore and Thailand.
* * *
Moody's Investors Service's rated BearingPoint Inc.'s 2.5%
Series A Convertible Subordinated Debentures due 2024 at B3.
HILTON HOTELS: Enters Into Partnership with Moet Hennessy
---------------------------------------------------------
Hilton Hotels Corp has entered into a partnership with Moet
Hennessy Louis Vuitton, or LVMH, and Spa Chakra, Newratings.com
reports.
Newratings.com relates that as agreed, "Hilton Hotels will offer
products and services of LVMH and Spa Chakra at many of its
hotels."
Hilton Hotels told Newratings.com that the partnership will
affect:
-- the Waldorf-Astoria Collection hotels,
-- Conrad Hotels & Resorts, and
-- selected Hilton hotels.
Hilton Hotels said that it would associate with the Guerlain and
Acqua di Parma brands of LVMH for spa treatments and related
products and services. Spa Chakra will provide design and
operational consulting services to Hilton Hotels, Newratings.com
states.
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.
INCO LTD: Steelworkers Reach Tentative Agreement w/ Contractors
---------------------------------------------------------------
The United Steelworkers of Inco Limited said that a tentative
settlement for a first collective agreement has been reached
with Ushitau and TSI, two contractors whose employees provide
core work for CVRD-Inco Limited's Voisey's Bay Nickel.
If ratified by USW members, the agreement would end a strike
that began April 18 against TSI and April 23 against Ushitau.
About Inco Ltd.
Headquartered in Sudbury, Ontario, Inco Limited (TSX, NYSE:N)
-- http://www.inco.com/-- produces nickel, which is used
primarily for manufacturing stainless steel and batteries. Inco
also mines and processes copper, gold, cobalt, and platinum
group metals. It makes nickel battery materials and nickel
foams, flakes, and powders for use in catalysts, electronics,
and paints. Sulphuric acid and liquid sulphur dioxide are
produced as byproducts. The company's primary mining and
processing operations are in Canada, Indonesia, and the U.K.
Inco Limited's 3-1/2% Subordinated Convertible Debentures due
2052 carry Moody's Investors Service's Ba1 rating.
INDOSAT TBK: Moody's Keeps Ba1 Local Currency Issuer Rating
-----------------------------------------------------------
Moody's Investors Service affirmed PT Indosat Tbk's Ba1 local
currency issuer rating and has also changed the outlook to
stable.
At the same time, Moody's has affirmed Indosat's Ba3 senior
unsecured foreign currency rating. The rating outlook on the
bond remains positive which is in line with the outlook
on Indonesia's foreign currency country ceiling.
"The change in outlook to stable has been prompted by Indosat's
decline in relative market share and average revenue per user.
This has been because of the increasingly competitive nature of
Indonesia's cellular telecommunications markets and despite
their continued growth," says Laura Acres, a Moody's Vice
President, adding, "Moreover, Indosat is to embark on a large
capital expenditure plan over the next 3 years resulting
in significant negative free cash flow. As a result, it is more
appropriately positioned at the current Ba1 rating."
Indosat's Ba1 rating combines:
(a) the company's underlying strength derived from its sound
operational and financial profile; and
(b) the credit support that Moody's believes its largest
shareholder, Temasek Pte Limited-owned (rated Aaa)
Singapore Technologies Telemedia Pte Ltd, is likely to
provide in a distress situation.
Moody's ranks the company's underlying credit strength as a 12
-- equivalent to Ba2 on our global rating scale. This assessment
reflects the company's established position as Indonesia's
second largest cellular operator, enhanced network coverage
(which positions it well to capture continued growth at both
subscriber and revenue levels), and the presence of STT as the
largest single shareholder -- which benefits Indosat through its
involvement in management and technological issues.
Notwithstanding these positive factors, the underlying credit
strength also acknowledges Indosat's large capex plan and
negative free cash flow position over the next 2 years;
increasing competition as evidenced by the increased number of
both domestic and international players; as well as country
specific issues such as uncertainty surrounding Indonesia's
political and economic environment and particularly regulatory
uncertainty. Any deterioration in the political system or
changes in the regulatory regime could have an impact on
Indosat's operating profile and prospects for growth.
Indosat is 40.8% owned by AMH, which is majority owned by STT, a
wholly owned subsidiary of Temasek. Because of this ownership
structure, Moody's overlays the company's underlying credit
strength with a joint-default analysis for government-related
issuers. This involves estimating the likelihood that in the
event of impending failure by the company, STT/Temasek would
step in and prevent default.
Moody's scores STT's willingness to support Indosat as "medium",
reflecting the relative importance of the Indosat investment to
STT/Temasek and its track record of injecting additional capital
to support growth.
Medium support also reflects the effective ownership by STT and
the likelihood that STT/Temasek will remain the largest single
shareholder in the short-to-medium term.
Upward changes for the local currency rating will primarily be
driven by consistent improvement in Indosat's underlying credit
strength. Specific ratios that Moody's would consider include:
(EBITDA-Capex)/interest remaining above 1.5x on a consistent
basis; debt/EBITDA remaining below 2.0x; and a clear flight path
to positive free cash flow. An upgrade of the foreign country
ceiling will trigger the upgrade of the senior unsecured bond
rating.
Downward pressure on the rating could emerge from a
deterioration in Indosat's credit assessment or a reduction in
the support level. Specifically, Moody's would look for
(EBITDA-Capex)/interest being less than 1.0x on a consistent
basis, and debt/EBITDA increasing above 3.0x. In addition,
Moody's would be concerned if Indosat lost any further market
share, or if adjusted EBITDA margins fell below 50%.
In addition, any further reduction in STT/Temasek's shareholding
may have negative consequences for the rating as it may impact
the support level.
Total consolidated revenue for 2006 was IRP12.2 trillion (US$1.3
billion) which gave rise to an EBITDA of IRP7.6 trillion (US$825
million). As of March 31, 2007, Indosat had a nationwide market
share of 27% and 18 million subscribers. Approximately 95% of
the subscriber base is prepaid.
About Indosat
PT Indosat Tbk -- http://www.indosat.com/-- is a fully
integrated Indonesian telecommunications network and service
provider and provides a full complement of national and
international telecommunications services in Indonesia. The
company provides international long-distance services in
Indonesia. It also provides multimedia, data communications and
Internet services to Indonesian and regional corporate and
retail customers. The company's principal cellular service is
the provision of airtime, which measures the usage of its
cellular network by its customers. Airtime is sold through
postpaid and prepaid plans. It provides a variety of
international voice telecommunications services and both
international switched and non-switched telecommunications
services. MIDI services include high-speed point-to-point
international and domestic digital leased line broadband and
narrowband services, a high-performance packet-switching service
and satellite transponder leasing and broadcasting services.
PHILLIPS-VAN: Good Performance Cues S&P's Positive CreditWatch
--------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on New
York City-based Phillips-Van Heusen Corp., including the 'BB+'
corporate credit rating, on CreditWatch with positive
implications. The apparel company had about US$400 million in
debt outstanding at May 6, 2007.
"The CreditWatch action follows PVH's first-quarter results that
reflected a continuation of positive operating momentum for the
past several quarters," said Standard & Poor's credit analyst
Susan Ding. For the latest quarter, revenue rose 17% from a
year earlier, primarily due to higher royalty income from its
Calvin Klein franchise, especially in fragrances, and better
product mix. Operating margins also improved due to growth in
royalty revenue and better sell-throughs in the wholesale dress
shirt and retail businesses.
PVH's credit protection measures have been improving steadily
and are currently above the rating medians. Standard & Poor's
will review the company's financial and operating strategies to
resolve the CreditWatch listing.
About Phillips-Van Heusen
Phillips-Van Heusen Corporation -- http://www.pvh.com/-- owns
and markets the Calvin Klein brand worldwide. It is a shirt
company that markets a variety of goods under its own brands:
Van Heusen, Calvin Klein, IZOD, Arrow, Bass and G.H. Bass & Co.,
Geoffrey Beene, Kenneth Cole New York, Reaction Kenneth Cole,
BCBG Max Azria, BCBG Attitude, Sean John, MICHAEL by Michael
Kors, Chaps and Donald J. Trump Signature.
It has operations in the Asia-Pacific region, including
Indonesia, China, Philippines, Malaysia, and Thailand.
The Troubled Company Reporter - Asia Pacific reported on
Dec. 14, 2006, that Moody's Investors Service upgraded Phillips
Van Heusen Corporation's corporate family rating to Ba2 from
Ba3. The company's senior secured notes were upgraded to Baa3
from Ba1 and the company's senior unsecured notes were upgraded
to Ba3 from B1. The rating outlook is stable, reflecting
Moody's expectations that the company will sustain financial
metrics appropriate for the rating category.
PERTAMINA: To Take Over Medco Energi's Madura Shares
----------------------------------------------------
PT Pertamina plans to take over PT Medco Energi Internasional's
65% share in the Madura onshore oil block, Jakarta Post reports.
The report relates that Sukusen Soemarinda, Pertamina upstream
director, said that the company had sent a letter to the Energy
and Mineral Resources Ministry requesting the approval of its
plan to take over the block.
Medco Energi is in the process of returning the block to the
government because it said the block was no longer considered
prospective. However, Pertamina believed that the block was
still prospective and economically feasible, the report says.
The Post adds that Pertmina and Medco had so far spent
US$16 million for exploration activities of the total investment
commitment worth US$63 million. The government granted the
rights to operate the Madura block for Medco and Pertamina in
1997.
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 LISTRIK: Moody's Puts B1 Rating on Proposed USD Bonds
----------------------------------------------------------------
Moody's Investors Service assigned a B1 senior unsecured rating
to PT Perusahaan Listrik Negara's proposed U.S. dollar bond
issuance.
At the same time, Moody's has affirmed PLN's B1 corporate family
rating and A1.id national scale rating. The outlook for all the
ratings is positive, which is in line with the sovereign's
positive outlook.
The proceeds from the bond issuance will be used primarily to
fund capital expenditure requirements in connection with the
Fast Track Program and for general corporate purposes.
The ratings take into account:
(1) PLN's stand-alone credit quality, and
(2) the high likelihood of the Indonesian government providing
the company with credit support in a stress situation,
since PLN is 100% owned by the Ministry of State-Owned
Enterprises.
"The stand-alone rating reflects PLN's importance as Indonesia's
only vertically integrated electricity utility, and expectations
of sustained government support through subsidies to ensure its
financial viability and operational soundness. Such an
expectation is underpinned by its strong links with the
government, which is its 100% owner," says Moody's lead analyst
for the company, Jennifer Wong, adding, "Furthermore, subsidies
to PLN are part of the state budget. As such, Moody's views
PLN's rating as closely integrated with, and strongly linked to,
the government's credit quality."
"While the stand-alone rating has incorporated the above
factors, it has also taken into account PLN's modest stand-alone
credit metrics due to the large gap between average sales prices
and cost of supply; particularly in light of rising fuel
expenses, as well as large capex requirements under the Fast
Track Program," says Wong.
Because PLN is 100%-owned by MSOE and is therefore a Government-
Related Issuer, Moody's overlays the company's stand-alone
rating on a joint default analysis for GRIs. That involves
estimating the likelihood that in the event of pending failure
by the company, MSOE would step in and prevent a default.
Given the close integration of PLN's rating with the sovereign
rating, an upgrade in the latter would trigger a rating upgrade
of PLN.
Similarly, a downgrade in the sovereign rating would trigger a
downgrade for PLN. Furthermore, a partial privatization of PLN
or any government plan to cease subsidy support -- a scenario
that Moody's considers unlikely in the near-to-medium term --
would impact the support and dependence level and therefore
pressure the rating.
PT Perusahaan Listrik Negara is an Indonesian state-owned
vertically integrated electricity utility with generation
capacity of over 22,000 MW and transmission capacity of 32,844
km. It is a monopoly operator of transmission and distribution
networks and is the country's largest electricity producer. The
government - represented by MSOE - has complete ownership.
About Perusahaan Listrik
Indonesian state utility firm PT Perusahaan Listrik Negara --
http://www.pln.co.id/-- transmits and distributes electricity
to around 30 million customers, roughly 60% of Indonesia's
population. The Indonesian Government decided to end PLN's
power supply monopoly to attract independents to build more
capacity for sale directly to consumers, as many areas of the
country are experiencing power shortages.
PLN posted a IDR4.92-trillion net loss in 2005, against a net
loss of IDR2.02 trillion in 2004.
=========
J A P A N
=========
AMAZON.COM: S&P Upgrades Corporate Credit Rating to BB
------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Amazon.com to 'BB' from 'BB-'. The rating change is
based on the company's continued strong growth, maintenance of
its good market position, and improved credit protection
metrics.
The outlook is stable.
"The ratings on Seattle, Washington-based Amazon.com, one of the
world's largest online retailers, reflect the risks of rapid
growth, participation in the mature and highly competitive
retail industry, and continued operating margin deterioration,"
said Standard & Poor's credit analyst David Kuntz, "tempered by
the company's market position in online retailing and improving
cash flow protection measures." We could consider a positive
outlook if Amazon is able to show gains in operating performance
with commensurate improvement in cash flow measures and a
further reduction in debt leverage.
Based in Seattle, Wash., Amazon.com, Inc. (Nasdaq: AMZN) a
Fortune 500 company, opened on the World Wide Web in July 1995
and offers Earth's Biggest Selection. Amazon.com seeks to be
Earth's most customer-centric company, where customers can find
and discover anything they might want to buy online, and
endeavors to offer its customers the lowest possible prices.
Amazon.com and other sellers offer millions of unique new,
refurbished and used items in categories such as health and
personal care, jewelry and watches, gourmet food, sports and
outdoors, apparel and accessories, books, music, DVDs,
electronics and office, toys and baby, and home and garden.
Amazon.com and its affiliates operate retail sites
http://www.amazon.com/, http://www.amazon.co.uk/,
http://www.amazon.de/, http://www.amazon.co.jp/,
http://www.amazon.fr/,http://www.amazon.ca/ and
http://www.joyo.com/. The company has fulfillment centers in
Japan and China. Other office locations include those in
Germany, India, and the United Kingdom.
BOSTON SCIENTIFIC: Court Bars Motion to Disallow Some Claims
------------------------------------------------------------
Boston Scientific Corp.'s motions to dismiss some product-
liability claims against the company over implantable
heart defibrillators has been rejected by a federal court
judge, Reuters said on its Web site Wednesday.
In his decision, the federal judge opined that Guidant Corp.,
which Boston Scientific bought last year, continued to sell
heart rhythm-management devices after learning of possible
defects, Reuters says.
"We are fully prepared to take the bellwether cases to trial
and remain confident that when juries look into the
individual facts, they will side with us," a Boston Scientific
spokesman was cited by Reuters as saying.
Headquartered in Natick, Massachusetts, Boston Scientific
Corporation (NYSE: BSX) -- http://www.bostonscientific.com/--
develops, manufactures and markets medical devices used in a
broad range of interventional medical specialties. The company
has offices in Argentina, France, Germany, and Japan, among
others.
* * *
As reported in the Troubled Company Reporter on May 11, 2007,
Moody's placed Boston Scientific Corporation's ratings including
its (P) Ba1 subordinated shelf and (P) Ba2 preferred stock
ratings
under review for possible downgrade. The rating action reflects
Moody's expectation that, absent any material debt reduction,
financial strength measures over the near term will be below
those
identified for an investment grade company under Moody's Global
Medical Products & Device Industry Rating Methodology.
GOODWILL GROUP: Welcia and Wisnet Express Interest to Buy Firm
--------------------------------------------------------------
Drugstore chain operator Welcia Kanto Co. and nursing home
operator Wisnet Co. will offer to jointly buy all of the nursing
care operations of The Goodwill Group Inc., sources reveal to
Japan Times.
Welcia, which is an affiliate of supermarket chain operator Aeon
Co., and Wisnet expressed their interest to take over Goodwill's
entire nursing care operations but still has to review
unprofitable services provided on remote islands and in other
underpopulated areas, relates the report.
Welcia, according to the report, hopes to strengthen its
business to dispense medicine for the elderly through the
purchase.
About The Goodwill Group
Japan-based The Goodwill Group, Inc. --
http://www.goodwill.com/gwg/english/index.html-- is a involved
in five business segments. The Staffing segment offers
recruitment services for technicians, senior workers and others.
The Human Resources-related segment provides employee hiring
support services to corporate clients, counseling services to
workers and outplacement services to retired and retiring
workers. The Nursing-care and Medical Support segment is
engaged in the provision of home-care services, care services in
facilities and dental examination services at home, as well as
the sale of nursing-care goods and equipment, among others. The
Senior Residence and Restaurant segment operates nursing home
under the name THE BARRINGTON HOUSE, and also operates
restaurant in both domestic and overseas markets. The Others
segment is engaged in the planning, designing and management of
pet care facilities, the operation of pet care shops, the
operation and management of nurseries, the provision of baby-
sitting services and others.
The Troubled Company Reporter - Asia Pacific reported on
June 14, 2007, that The Goodwill Group is thinking of selling
its home nursing-care services division after the Japanese
government banned it from renewing its licenses due to its
involvement in a fraud scandal.
The article conveys that the firm allegedly obtained some of the
licenses for nursing-care service operators certified under a
public insurance program through fraudulent applications,
including those with an inflated number of employees.
NOVA CORP: Trade Ministry Bans New Contracts with Students
----------------------------------------------------------
Nova Corporation was ordered by the government last week to
partially suspend business for six months for lying to customers
about its services, reports Japan Times.
According to the report, the Ministry of Economy, Trade and
Industry revealed to reporters that Nova misled prospective
clients by saying they can book language lessons anytime they
want at any Nova school nationwide. However, clients complained
that they were not able to book lessons during busy periods.
METI, writes Japan Times, in its investigation, discovered that
several Nova schools did not give full refunds to people who
canceled lessons.
In addition, METI received reports claiming that Nova deceived
their clients believing their cooling-off periods had expired
and they could not cancel their contracts, Japan Times relates.
Under the law, private language school clients have an eight-day
cooling-off period from the time they sign a contract, during
which they can cancel and get a full refund. Reportedly, Nova
staff told some people the cooling-off period begins on the day
they register their name and address at the school, not when
they sign a contract, conveys Japan Times.
The article adds that METI officials banned Nova from selling
long-term contracts for language lessons starting June 14, 2007.
Reportedly, contracts with existing students will be allowed to
be renewed.
Japan Times quotes a METI official as saying that Nova "engaged
in illegal acts, with the top management at its head office
authorizing the irregularities. The company even compiled a
manual advising staff on how to respond to claims by students."
Osaka-based company, Nova Corporation-- http://www.nova.ne.jp/
-- is primarily engaged in the operation of language schools.
The Company has seven subsidiaries and two associated companies.
The Company is involved in the teaching of languages, the
creation of international environment of different languages and
cultures, the provision of real time services, the development
and provision of network contents, the development of hardware
technology, the building of human network, as well as the
organization of member groups to provide services
internationally. The Company also has subsidiaries and
associates, which are engaged in advertisement services,
interior construction, facility and commodity sale, overseas
study services, computer system services, real estate brokerage,
facility leasing and installment sale, capital management,
cleaning services, sanitary management, multimedia goods sale,
Internet connection services, customer services and assistance
to foreigners.
Nova has reported two consecutive net losses for fiscal years
ended March 31, 2006 and March 31, 2007 respectively.
The company posted a JPY3.09 billion for March 31, 2006 and
JPY2.89 billion for March 31, 2007.
NOVA CORP: Plans to Issue Shares to Gain Back Public Trust
----------------------------------------------------------
In an effort to recover from the scandal it now faces and to
regain the trust of the public, Nova Corporation is considering
different options to strengthen its capital, various reports
say.
Among the choices the language school has considered is the
issuance of new shares to other companies, Japan Times cites
Nova President Nozomu Sahashi as saying.
In what is considered to be Mr. Sahashi's first interview after
the suspension order was imposed by the Ministry of Economy,
Trade and Industry, he said that the details of the said
issuance of shares plan has yet to be worked out, Japan Times
relates.
Mr. Sahashi expressed to Japan Times that tapping external
capital is a "measure toward a next step."
Meanwhile in an interview report by the Yomiuri Shimbun,
Mr. Sahashi said that various industries have contacted him for
a capital and business alliance and further added that the
company is "considering the offers because trust in us has to be
restored."
Aside from the proposals the English-language school is
considering selling off its properties and real estate in Osaka
estimated to be worth several billion yen, writes the Yomiuri
Shimbun.
Mr. Sahashi revealed to the Yomiuri Shimbun that in order to get
back the public's trust, they need to have a good business
partner affiliation preferring companies of different industry
over other English schools as he claims he can't "expect any
benefits from such a partnership."
The Nova president expects that they will have a tough time in
the first half of this fiscal year but is positive they will
improve in the second half.
According to Japan Times, Mr. Sahashi stated that the management
of Nova "must take responsibility" in the future, including
himself.
The Japan Times further reports that the Japanese government
said the subsidies were no longer given starting Wednesday last
week.
Reportedly, the government provides subsidies for people engaged
in educational training authorized by the welfare ministry to
improve the abilities of the unemployed and other people.
About Nova Corporation
Osaka-based company, Nova Corporation-- http://www.nova.ne.jp/
-- is primarily engaged in the operation of language schools.
The Company has seven subsidiaries and two associated companies.
The Company is involved in the teaching of languages, the
creation of international environment of different languages and
cultures, the provision of real time services, the development
and provision of network contents, the development of hardware
technology, the building of human network, as well as the
organization of member groups to provide services
internationally. The Company also has subsidiaries and
associates, which are engaged in advertisement services,
interior construction, facility and commodity sale, overseas
study services, computer system services, real estate brokerage,
facility leasing and installment sale, capital management,
cleaning services, sanitary management, multimedia goods sale,
Internet connection services, customer services and assistance
to foreigners.
Nova has reported two consecutive net losses for fiscal years
ended March 31, 2006 and March 31, 2007 respectively.
The company posted a JPY3.09 billion for March 31, 2006 and
JPY2.89 billion for March 31, 2007.
On June 18, 2007, Troubled Company Reporter-Asia Pacific
reported that Nova Corporation was ordered by the Japanese
Ministry of Economy, Trade and Industry to suspend its business
for six months for lying to customers about its services.
RESONA HOLDINGS: Ties Up with Dai-Ichi to Pay JPY2.3-Bil. Debt
--------------------------------------------------------------
Resona Holdings Inc. and Dai-Ichi Mutual Life Insurance Co. are
close to striking a deal on capital and operational tie-ups as
banks and insurers increasingly move to beef up business
relations ahead of further deregulation, industry sources
revealed to Japan Times.
According to Japan Times sources, Resona, the holding company of
Resona Bank and Saitama Resona Bank, plans to issue about JPY100
billion worth of preferred shares to Dai-Ichi and hopefully be
able to reach an agreement by the end of July.
The Yomiuri Shimbun reports that both companies are also eyeing
a tie-up in the sales of Dai-Ichi's insurance products at Resona
group bank branches after the full liberalization of such sales,
expected in December.
Resona Holdings, currently having a JPY2.3-billion balance in
unpaid public funds, is hoping to boost its income base by
aggressively promoting the insurance business to gain commission
fees, Japan Times sources conveyed.
However, Yomiuri Shimbun sources revealed that Resona hopes to
issue preferred shares without voting rights to Dai-Ichi Mutual
and use the raised capital to pay back part of the funds it
owes.
While Japan Times reports that Resona Holdings is set to issue
more than JPY300 billion worth of bondlike preferred shares, of
which about JPY100 billion will be allocated to Dai-Ichi,
Yomiuri Shimbun sources said that Dai-Ichi will acquire
preferred shares amounting to around JPY300 billion to be issued
by Resona.
In the article, Japan Times shares that Resona is also
considering allocating the remaining JPY200 million to foreign-
affiliated insurance companies, investment banks, securities
firms and companies in other industries.
Through the alliance, Resona will be able to enter the field of
insurance sales, allowing it to earn commission fees and enhance
its profitability, and Dai-Ichi would be able to expand its
sales channels which previously were centered around female
workers visiting homes or companies to sell its policies relates
the Yomiuri Shimbun.
About Resona Holdings
Resona Holdings, Inc., based in Osaka, Japan, --
http://www.resona-gr.co.jp/-- is a holding company. Through its
subsidiaries and associated companies, the Company is engaged in
general banking, trust operation, credit card and financial
services. The Company is comprised of 15 domestic subsidiaries
and 21 overseas subsidiaries, as well as two associated
companies. It has operations in Japan, the United Kingdom,
Indonesia, Thailand and the Cayman Islands.
On December 13, 2005, Troubled Company Reporter-Asia Pacific
reported that Rating and Investment Information, Inc gave a BBB
issuer rating to Resona Holdings reflecting the group's overall
creditworthiness and the financial structure of the holding
company.
=========
K O R E A
=========
BIOMET INC: LVB Acquisition Commences US$11 Billion Tender Offer
----------------------------------------------------------------
LVB Acquisition, LLC and LVB Acquisition Merger Sub, Inc. have
commenced a tender offer to acquire all of the outstanding
common shares of Biomet, Inc. for US$46.00 per share in cash, or
an equity value of US$11.4 billion.
LVB Acquisition, LLC and LVB Acquisition Merger Sub, Inc. are
indirectly owned by investment partnerships directly or
indirectly advised or managed by The Blackstone Group, Goldman,
Sachs & Co., Kohlberg Kravis Roberts & Co. and TPG.
Following completion of the tender offer, LVB Acquisition, LLC
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 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.
LVB Acquisition, LLC will file with the Securities and Exchange
Commission a tender offer statement on Schedule TO setting forth
in detail the terms of the offer. Biomet today will file with
the Commission a solicitation/recommendation statement on
Schedule 14D-9 setting forth in detail, among other things, the
recommendation of Biomet's board of directors that Biomet
shareholders tender their shares into the offer.
The offer is conditioned upon, among other things, there being
validly tendered and not withdrawn before the expiration of the
offer that number of Biomet common shares which, when added to
any shares already owned by LVB Acquisition, LLC and its
subsidiaries, represents at least 75% of the outstanding shares.
LVB Acquisition, LLC may revise the condition regarding minimum
acceptance of the 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 offer and withdrawal rights will expire at midnight, New
York City time, on Wednesday, July 11, 2007, unless the offer is
extended.
The dealer managers for the offer are Banc of America Securities
LLC and Goldman, Sachs & Co., and the information agent for the
offer is Innisfree M&A Incorporated.
About Biomet Inc.
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.
The Troubled Company Reporter - Asia Pacific reported on Jun 12,
2007, that 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.
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.
DURA AUTOMOTIVE: Wants to Amend Terms of US$300MM DIP Facility
--------------------------------------------------------------
Dura Automotive Systems Inc. and its debtor-affiliates wants to
amend the terms to a US$300 million debtor-in-possession
financing entered on November 2006 to provide additional
financial flexibility and a stable environment while they
negotiate key elements of their Chapter 11 plan over ensuing
critical months.
DIP Agreements Amended
The Postpetition Credit Agreements approved by the U.S.
Bankruptcy Court for the District of Delaware entered into by
the Debtors with Goldman Sachs Capital Partners L.P., General
Electric Capital Corporation, and other lender parties contain
various covenants and provisions that were negotiated by the
Debtors in the weeks immediately preceding and following the
Oct. 30, 2006 petition date. The relevant financial covenants
were based on a financial budget. Given the relatively short
timeframe available to secure a much needed DIP financing, the
Debtors prepared the Original DIP Budget via an expedited 2007
annual planning process.
Since that time, the Debtors have completed a review and re-
forecast for 2007. The Debtors and their advisers have
identified a host of additional operational restructuring
initiatives which, when combined with certain initiatives
identified before the Petition Date are projected to greatly
improve the Debtors' future financial performance.
The efforts from the combined operational restructuring
initiatives have already begun to materialize in the Debtors'
and their European and other foreign affiliates' recent
financial performance. The Debtors' recently formulated five-
year business plan, which was developed on a "bottom-up" basis,
incorporates the expected improvements from the operational
restructuring initiatives. The implementation of these
initiatives is expected to be complete by mid-2008.
The Debtors are targeting an emergence from Chapter 11 in the
late third quarter to early fourth quarter of 2007. In addition
to their operational restructuring efforts, the Debtors are
currently pursuing a sale of their Atwood Mobile Products
Division, as well as rights offering to certain unsecured
creditors.
As such, the ensuing months represent the most critical period
in the Debtors' Chapter 11 restructuring process. While the
Business Plan does not project a default under any of the
salient terms of the Postpetition Credit Agreements, the Debtors
seek to enter into amendments to the Agreements.
To that end, the Debtors have identified certain covenants and
provisions that must be modified to provide them with this
needed financial flexibility. During the weeks leading up to
the filing of the motion, the Debtors and Miller Buckfire & Co.
LLC actively negotiated with the Postpetition Lenders to amend
the Postpetition Credit Agreements. The DIP Amendments provide
for these adjustments:
1. Minimum EBITDA Requirement -- Minimum Consolidated and
Guarantor adjusted EBITBA requirements to be reduced for
the fourth-month period from May 2007 to August 2007. The
existing threshold levels for September 2007 through
December 2007 will remain unchanged.
2. Non-Guarantor Receivable and Factoring and Sale-
Leasebacks -- Baskets for permissible Non-Guarantor
receivables factoring and sale-leaseback transactions to
be combined.
3. Limited Issuance of Non-Guarantor Letters of Credit --
Authorize the non-Guarantors to obtain up to US$5,000,000
in cash-collateralized letters of credit. These letters
of credit are not to be issued under the Postpetition
Credit Agreements.
4. Brazilian Funds Return -- Authorize the Debtors to return
US$1,450,000 of funds received from a non-debtor Brazilian
affiliate as a prepayment under an existing intercompany
loan. The Brazilian subsidiary made the prepayment on the
loan in order to assist the Debtors with near-term cash
management needs. The funds are needed by the Brazilian
subsidiary to fund previously identified capital budgeting
activities, and will be transferred back to the Brazilian
subsidiary through a new US$1,450,000 loan.
The DIP Amendments are a proactive measure to ensure the Debtors
a stable environment as they prepare to exit Chapter 11. In
addition to the incremental headroom to be provided above
certain of the Debtor's financial covenant thresholds, the Non-
Guarantors will obtain additional financial flexibility,
consistent with their operational restructuring efforts.
In consideration for the covenant relief, the DIP Amendments
provide for an aggregate fee of up to US$300,000 to be paid to
the DIP Lenders if all of them timely support for the DIP
Amendments. On June 18, 2007, the administrative agents to the
Postpetition Credit Agreements will tally the final voting
results from the DIP Lenders regarding the DIP Amendments.
About DURA Automotive
Rochester Hills, Mich.-based DURA Automotive Systems Inc.
(Nasdaq: DRRA) -- http://www.DURAauto.com/-- is an independent
designer and manufacturer of driver control systems, seating
control systems, glass systems, engineered assemblies,
structural door modules and exterior trim systems for the global
automotive industry. The company is also a supplier of similar
products to the recreation vehicle and specialty vehicle
industries. DURA sells its automotive products to North
American, Japanese and European original equipment manufacturers
and other automotive suppliers.
The Debtors filed for chapter 11 petition on Oct. 30, 2006
(Bankr. D. Delaware Case No. 06-11202). Richard M. Cieri, Esq.,
Marc Kieselstein, Esq., Roger James Higgins, Esq., and Ryan
Blaine Bennett, Esq., of Kirkland & Ellis LLP are lead counsel
for the Debtors' bankruptcy proceedings. Mark D. Collins, Esq.,
Daniel J. DeFranseschi, Esq., and Jason M. Madron, Esq., of
Richards Layton & Finger, P.A. Attorneys are the Debtors' co-
counsel. Baker & McKenzie acts as the Debtors' special counsel.
Togut, Segal & Segal LLP is the Debtors' conflicts counsel.
Miller Buckfire & Co., LLC is the Debtors' investment banker.
Glass & Associates Inc., gives financial advice to the Debtor.
Kurtzman Carson Consultants LLC handles the notice, claims and
balloting for the Debtors and Brunswick Group LLC acts as their
Corporate Communications Consultants for the Debtors. As of
July 2, 2006, the Debtor had US$1,993,178,000 in total assets
and US$1,730,758,000 in total liabilities.
HYNIX SEMICONDUCTOR: Moody's Lifts Rating on Good Performance
-------------------------------------------------------------
Moody's Investors Service upgraded to Ba2 from Ba3 Hynix
Semiconductor Inc's senior unsecured bond rating and corporate
family rating.
At the same time, Moody's assigned a Ba2 senior unsecured bond
rating for Hynix's proposed US$500 million issuance. The
outlook for the ratings is stable. This concludes the
review for possible upgrade commenced on May 23, 2007.
"The upgrade has been prompted by Hynix's improved financial
profile and its ability to sustain its sound operating
performance over the industry cycle, although seasonal earnings
volatility is apparent," says Ken Chan, a Moody's AVP/Analyst,
adding, "Hynix will maintain its strong position in the global
dynamic random access memory industry over the medium term."
"In addition, it will remain competitive due to its continual
migration into 66nm (nanometer) processing technology and the
fact that its planned 12-inch wafer production capacity in China
and Korea will be coming on stream over the next 1- 2 years,"
says Chan, Moody's lead analyst for Hynix.
"Hynix also has the flexibility to switch production capacity
between DRAM and NAND flash which could partially mitigate cash
flow volatility," adds Chan.
At the same time, Hynix is projected to generate negative free
cash flows, given its need to incur large capex plans over the
next few years. But it also has stronger access to banking
financing and capital markets, thanks to sustainable
improvements in its operating profile and capital structure.
Hynix is also exposed to the volatility of global memory
markets, where average selling prices -- which typically drop
30% per annum for DRAM products -- are declining. However,
higher memory requirements from Windows Vista should boost DRAM
demand in the long term.
The stable outlook reflects Moody's view that Hynix will
maintain its market position in the global DRAM and NAND flash
markets, while at the same time sustaining its operating
performance over the industry cycle.
Upward rating pressure could arise if Hynix generates positive
free cash flow through the silicon cycle. A build-up in its
cash balance and the maintenance of strong balance sheet
liquidity to buffer against industry cyclicality would also be
positive for the rating.
On the other hand, the rating would undergo downward pressure
if:
(1) there are material delays in its technology migration,
and which negatively affects its competitiveness against
its peers; or
(2) a deterioration in its credit metrics occurs, due to a
significant industry downturn or margin erosion, such
that Debt/Cap exceeds 30-35% and EBIT/Interest
falls below 5x over the cycle.
About Hynix Semiconductor
Headquartered in Echon, South Korea, Hynix Semiconductor Inc.
-- http://www.hynix.com/-- is a semiconductor manufacturer.
Through a merger with LG Semiconductor in 1999, Hynix
Semiconductor now has the world's largest dynamic random access
memory chip production capacity as well as the industry's best
technical development capacity by fully exploiting synergies
resulting from the historical integration of both companies.
REMY INTERNATIONAL: To File Prepackaged Chapter 11 Protection
-------------------------------------------------------------
Remy International Inc., said Friday that it had reached
agreement with holders of approximately:
* 83% of its 8-5/8% Senior Notes,
* 84% of its 9-3-8% Senior Subordinated Notes, and
* 75% of its 11% Senior Subordinated Notes,
on the terms of a consensual financial restructuring that would
reduce the company's debt obligations by approximately
US$360 million.
The company and the consenting noteholders have entered into a
Plan Support Agreement pursuant to which the noteholders have
agreed to consummate the restructuring through a prepackaged
plan of reorganization.
"We have reached a major milestone toward achieving our goal of
substantially reducing our debt burden. Once our financial
restructuring is completed, Remy's capital structure will
provide a foundation for sustainable profitability and better
position the Company to meet the challenges of our industry head
on," said President and Chief Executive Officer John Weber.
A key feature of the prepackaged plan is that all trade
creditors, suppliers, customers and employees will receive
amounts owed to them in the ordinary course of business. The
company intends to begin soliciting votes on the prepackaged
plan from holders of its unsecured notes promptly following
conclusion of key customer negotiations. Following the
solicitation period, the company expects to commence a
prepackaged Chapter 11 proceeding in order to implement the
plan. The proceeding is expected to last between 45 and 60
days.
"This ensures trade creditors, suppliers, customers and
employees see no difference in Remy's operations while we
complete our recapitalization. The reorganization plan will
provide for uninterrupted payment of our existing and future
obligations to these constituents and provide for seamless
continuation of our operations," Mr. Weber commented.
DIP & Exit Financing
In conjunction with the anticipated prepackaged restructuring,
Remy is in the process of obtaining both debtor-in-possession
financing and an approximately US$330 million senior secured
exit credit facility, the latter to become effective upon
consummation of the prepackaged plan.
The company anticipates that the exit financing will consist of
a term loan of approximately US$205 million, with the remainder
as a US$125 million revolving credit facility.
The company is making substantial progress in renegotiating
certain key commercial agreements to improve margins, its other
stated objective with respect to strengthening the company. "In
addition to consensually improving the capital structure, I am
very pleased by the cooperative nature of discussions with
certain customers. The spirit of cooperation exhibited by both
our noteholders and key customers are essential for Remy to
continue as a strong industry player," said Mr. Weber.
Terms of the Prepackaged Plan
The significant elements of the prepackaged plan include:
- Repaying the Second Priority Senior Secured Floating Rate
Notes in full.
- Raising US$75 million in preferred equity through a rights
offering to be made to holders of the company's Senior
Notes and Senior Subordinated Notes.
- Exchanging the company's existing 8-5/8% Senior Notes for
US$100 million of new third-lien Pay-in-Kind Notes and
approximately US$50 million in cash.
- Converting the 9-3/8% Senior Subordinated Notes and 11%
Senior Subordinated Notes into 100% of the common equity
of the reorganized company.
- Cancelling all of the company's existing equity interests.
"[Fri]day's very positive announcement is the result of
extensive negotiations with our stakeholders and hard work with
key customers, and we believe that it provides the highest value
and best outcome for all of Remy's constituents," said Mr.
Weber.
In light of the agreement, Remy elected to not make the June 15
interest payment in respect of the 8-5/8% Senior Notes.
About Remy International
Headquartered in Anderson, Indiana, Remy International Inc. --
http://www.remyinc.com/-- manufactures, remanufactures and
distributes Delco Remy brand heavy-duty systems and Remy brand
starters and alternators, locomotive products and hybrid power
technology. The company also provides a worldwide components
core-exchange service for automobiles, light trucks, medium and
heavy-duty trucks and other heavy-duty, off-road and industrial
applications.
Remy has operations in the United Kingdom, Brazil and Korea.
===============
M A L A Y S I A
===============
FINISAR CORP: Audit Comm. Completes Initial Stock Grant Review
--------------------------------------------------------------
Finisar Corporation's audit committee has completed its initial
review of the company's stock option practices. The Audit
Committee's initial key findings include:
-- There was no evidence of malfeasance on the part of any
present or former officer, director, or employee relating
to any Finisar options grant.
-- No present or former member of Finisar's board or its
management engaged in self-dealing with respect to option
grants.
-- Options to directors and officers were properly approved
and granted by the board or the board's compensation
committee.
-- The measurement dates for a number of option grants
differed from the recorded grant dates. Those errors
generally resulted from a deficient and poorly documented
process as well as a lack of attentiveness and a lack of
thorough understanding of relevant accounting rules on the
part of the individuals involved in the granting process.
However, the audit committee found administrative issues in
connection with the annual grants to existing employees. The
grant dates for most of these annual grants were selected before
the lists of options to be granted had been finalized. In all
but one year between 2000 and 2005, there was inadequate
contemporaneous documentation to verify the dates selected for
the annual grant, and, in one case, an earlier date with a more
favorable price was selected retrospectively for the annual
grant.
In the case of grants to newly hired employees and employees
hired in connection with Finisar's acquisitions, the audit
committee found deficiencies related to the process. This
resulted in a few instances where grants were delayed and a more
favorable price resulted from the delay, and a few instances
where an earlier date with a more favorable price was selected
retrospectively for a grant. Many of these grants lacked
contemporaneous evidence of grant date selection. The company
personnel involved in selecting the grant dates did not benefit
from these grants.
Based on the results of its investigation, the audit committee
concluded that the measurement dates for a number of stock
option grants differed from the recorded grant dates for such
awards and that the company will need to restate its historical
financial statements to record charges for compensation expense
relating to these past stock option grants and the tax impact
related to such adjustments. The company's management, in
conjunction with the audit committee, is in the process of
finalizing revised measurement dates, determining the amount of
the non-cash charges for compensation expenses, the resulting
tax impact and the accounting impact on its financial statements
for each fiscal period going back to fiscal 2000. The company
intends to complete its assessment and announce the results at
the earliest practicable date. Although the amounts of the
charges have not been determined at this time, such charges will
likely be material with respect to prior fiscal periods from
2000 through 2007.
Background of the Investigation
On Nov. 30, 2006, Finisar announced that, following an initial
voluntary review by management of a number of stock option
grants, the audit committee had commenced an investigation of
the company's historical stock options granting practices. The
audit committee is comprised of three independent, non-employee
directors. The audit committee subsequently conducted an
investigation with the assistance of independent legal counsel
and an independent accounting firm engaged to provide forensic
accounting services and reported its initial findings and
recommendations to the board of directors.
The investigation reviewed stock option grants to officers and
directors, existing employees and new hires, including grants
issued in connection with acquisitions, during the period from
November 1999 to September 2006. The investigation involved the
analysis of thousands of documents and hundreds of thousands of
electronic mail and document files, as well as interviews of
32 individuals, including current and former directors, officers
and employees. All company personnel cooperated fully with the
investigation.
Audit Committee's Remedial Measures
The board of directors has unanimously adopted the audit
committee's recommended remedial measures that include:
-- The implementation of a cross-functional training program
for certain key employees concerning (i) the company's
equity compensation programs and related improvements in
equity compensation controls, processes and procedures,
(ii) the accounting implications of the Company's equity
compensation programs, and (iii) the legal implications of
the equity compensation programs.
-- The appointment of a designated finance department employee
to be responsible for the accounting for stock options and
other forms of equity compensation.
-- The adoption of additional policies to assure that grants
will be recorded promptly in the Company's option
accounting database, and that grantees will receive prompt
written notification of their grants.
-- The adoption of policies to assure that there will be a
specific date to complete the generation of a list of
recommended equity grant amounts prior to the submission of
the recommendations to the compensation committee for
approval.
-- Implementation of a requirement that the company's internal
audit department review the company's compliance with the
controls and procedures regarding equity compensation at
least annually and report the results of its review to the
audit committee.
The audit committee and the board of directors will consider the
need for additional remedial action upon completion of the audit
committee's investigation and the restatement of the company's
historical financial statements.
In August 2006, prior to the internal review that led to the
investigation, Finisar changed its policies and procedures for
granting stock options to provide that all stock-based awards
are generally to be granted by the compensation committee of the
board of directors and, except in special circumstances, all
grants are to be made at regular quarterly meetings of the
compensation committee. The effective date of each quarterly
grant is the later of the third trading day following Finisar's
public announcement of its financial results for the preceding
quarter or the date of the meeting.
About Finisar Corporation
Headquartered in Sunnyvale, Calif., Finisar Corporation (NASDAQ:
FNSR) -- http://www.finisar.com/-- is a technology leader for
fiber optic components and subsystems and network test and
monitoring systems. These products enable high-speed data
communications for networking and storage applications over
Gigabit Ethernet Local Area Networks, Fibre Channel Storage Area
Networks, and Metropolitan Area Networks using Fibre Chanel, IP,
SAS, SATA, and SONET/SDH protocols.
The company's product development and manufacturing facilities
are located in Texas, Malaysia, China, and Singapore.
* * *
As reported in the Troubled Company Reporter on Jan. 16, 2007,
Finisar Corporation received a purported notice of default from
U.S. Bank Trust National Association, as trustee for the
company's 2-1/2% Convertible Senior Subordinated Notes due 2010.
The notice asserted that its failure to timely file its Form 10-
Q for the quarter ended Oct. 29, 2006, with the Securities and
Exchange Commission constituted a default under the Indenture,
dated as of Oct. 12, 2006, between the company and the Trustee
governing the Notes.
As of June 14, 2007, the company has not filed its report on
Form 10-Q for the quarter ended Oct. 29, 2006. The company
stated that until the audit committee's investigation on the
company's stock option practices is complete, the company will
be unable to file the report.
FINISAR CORP: Reports Preliminary 4th Qtr.& Annual 2007 Results
---------------------------------------------------------------
Finisar Corporation reported preliminary financial results for
its fourth fiscal quarter and fiscal year ended April 30, 2007,
on a non-GAAP basis.
The company is not providing detailed GAAP or non-GAAP financial
results for the quarter or fiscal year at this time. The
preliminary non-GAAP financial metrics do not reflect any
adjustments that may be needed as a result of the ongoing review
of the company's historical stock option grants and associated
accounting. These results should be considered preliminary
until such time as the company files its annual report on Form
10-K for fiscal 2007.
Fourth Quarter
-- Revenues of US$97.3 million were within the range of
US$96 million to US$98 million, as reported on May 9, 2007.
These results represented a 9.5% decrease in revenues from
the previous quarter and a 5% decrease from the comparable
quarter of the prior year. This decrease was caused
primarily by the impact of a transition by two customers
to "just-in-time inventory" arrangements during the quarter
and the continued utilization by certain customers of excess
inventories of products designed for SAN applications.
-- Revenues from the sale of optical products were US$88.4
million in the quarter ended April 30, 2007, a decline of
9.8% from US$98 million in the previous quarter and 3.9%
from US$91.9 million in the comparable quarter of the prior
year. Revenues from the sale of network test and monitoring
products were US$8.9 million, a decline of 6.6% from
US$9.5 million in the previous quarter and 15.1% from
US$10.5 million in the prior year.
-- Shipments of products designed for 10-40 Gb/s applications
totaled US$14.9 million, up 28.5% from US$11.6 million in
the previous quarter and up 172% from US$5.5 million in the
comparable quarter of the prior year.
-- With the decrease in total revenues to their lowest
quarterly total during the fiscal year, gross margins
declined sequentially from the prior quarter, but were still
higher than in the first half of the year due to the effects
of ongoing cost reduction efforts and a favorable shift in
product mix. Non-GAAP gross margins exclude stock
compensation expense, inventory reserves and certain other
charges, mostly of a non-cash nature.
-- Cash and short-term investments, plus other long-term
investments, which can be readily converted into cash,
totaled US$123.7 million at April 30, 2007, down from
US$135.9 million at the end of last quarter. The decrease
was primarily due to the completion of the acquisitions of
AZNA LLC and Kodeos Communications Inc. during the quarter,
which involved the use of about US$13.7 million in cash.
The company has classified certain of its investments as
long-term based on its intent to hold these securities
until maturity, although they can be readily sold if
required.
Fiscal Year
-- Revenues of US$419.2 million represented an increase of
15.1% over US$364.3 million in the prior year.
-- Revenues from the sale of optical products were
US$381.4 million, an increase of 17% from US$326 million in
the prior year. Revenues from the sale of network test and
monitoring products were US$37.8 million, a decrease of 1.5%
from US$38.3 million in the prior year.
-- Shipments of 10-40Gb/s optical products totaled
US$40.3 million, up 123% from US$18.1 million in the prior
year.
-- Gross profit on a non-GAAP basis increased 29% on a 15%
increase in revenues for the fiscal year due in part to a
favorable shift in product mix to more profitable longer
distance telecom and metro Ethernet applications and a
vertically integrated business model where higher shipment
levels are accompanied by a modest increase in manufacturing
costs. Non-GAAP gross margins exclude stock compensation
expense and certain other charges, mostly of a non-cash
nature.
The Audit Committee and the Board of Directors will consider the
need for additional remedial action upon completion of the Audit
Committee's investigation and the restatement of the company's
historical financial statements.
"Despite year-end problems with customer supply chain and excess
inventory issues, I think we made tremendous progress on a
number of fronts in the last fiscal year," said Jerry Rawls,
Finisar's chief executive officer. "We rolled out a number of
new products for 10 Gb/s and WDM applications and strongly
increased our sales to the telecom equipment industry. Revenues
from the sale of 10 Gb/s and 40 Gb/s products increased 123%
last fiscal year and we believe revenue growth for these
products in fiscal 2008 will generally remain on that same
trajectory. In addition, gross profit and gross margins were up
substantially from the prior year on a non-GAAP basis.
"On the technology front, the acquisitions of AZNA LLC and
Kodeos Communications, Inc. at year-end added unique
technologies for long distance optical transmission. We believe
these new technologies will enable us to develop products for
long haul telecommunications, a market we haven't served in the
past."
About Finisar Corporation
Headquartered in Sunnyvale, Calif., Finisar Corporation (NASDAQ:
FNSR) -- http://www.finisar.com/-- is a technology leader for
fiber optic components and subsystems and network test and
monitoring systems. These products enable high-speed data
communications for networking and storage applications over
Gigabit Ethernet Local Area Networks, Fibre Channel Storage Area
Networks, and Metropolitan Area Networks using Fibre Chanel, IP,
SAS, SATA, and SONET/SDH protocols.
The company's product development and manufacturing facilities
are located in Texas, Malaysia, China, and Singapore.
* * *
As reported in the Troubled Company Reporter on Jan. 16, 2007,
Finisar Corporation received a purported notice of default from
U.S. Bank Trust National Association, as trustee for the
company's 2-1/2% Convertible Senior Subordinated Notes due 2010.
The notice asserted that its failure to timely file its Form 10-
Q for the quarter ended Oct. 29, 2006, with the Securities and
Exchange Commission constituted a default under the Indenture,
dated as of Oct. 12, 2006, between the company and the Trustee
governing the Notes.
As of June 14, 2007, the company has not filed its report on
Form 10-Q for the quarter ended Oct. 29, 2006. The company
stated that until the audit committee's investigation on the
company's stock option practices is complete, the company will
be unable to file the report.
INTERPUBLIC GROUP: Provides Update on SEC Investigation
-------------------------------------------------------
The Interpublic Group has disclosed a development in the
investigation being conducted by the staff of the Securities and
Exchange Commission into the company's restatements announced in
2002 and 2005.
The company has received a "Wells notice," which invites the
company to make a responsive submission before the staff makes a
final determination concerning its recommendation to the
Commission. Under recently revised settlement procedures, such
a notice is now a prerequisite to settlement negotiations with
the Commission staff.
"Given our understanding of new procedures at the SEC, this
development is not unanticipated and we believe that it moves us
a step closer to resolution in this matter," said Interpublic
Chairman and CEO Michael I. Roth. "We have been cooperating
with the commission since the outset of its investigation in
2002 and it is our intention to share our point of view
regarding settlement with them. We look forward to a prompt
resolution to their deliberations."
Background on 2002 and 2005 Restatements
The company has previously made the following statements --
which continue to apply -- regarding its prior restatements and
the material weaknesses that gave rise to them.
In connection with the 2005 restatement, no current senior
management within the operating units or in the corporate group
acted inappropriately and those individuals who were found to
have done so at the local level have been separated from the
company. Also related to the 2005 restatement, the company has
reserved against media and vendor credits and is well on its way
to resolving those matters directly with its clients. The
shortcomings in the company's control environment that led to
the 2002 restatement to address imbalances in intercompany
accounts did not involve the misuse of client funds.
"During the past few years, we have moved to the highest
standards of transparency and corporate governance," added Mr.
Roth, "We continue to be on track to complete remediation of our
control environment with the filing of our 2007 10-K."
About Interpublic Group
Based in New York City, Interpublic Group of Companies Inc.
(NYSE: IPG) -- http://www.interpublic.com/-- is one of the
world's leading organizations of advertising agencies and
marketing services companies. Major global brands include
Draftfcb, FutureBrand, GolinHarris International, Initiative,
Jack Morton Worldwide, Lowe Worldwide, MAGNA Global, McCann
Erickson, Momentum, MRM Worldwide, Octagon, Universal McCann and
Weber Shandwick. Leading domestic brands include Campbell-
Ewald, Carmichael Lynch, Deutsch, Hill Holliday, Mullen and The
Martin Agency.
The company has operations worldwide, including in Argentina,
Australia, Chile, China, India, Indonesia, Ireland, Japan,
Malaysia, Panama, Spain, Thailand, the United States and
Venezuela, among others.
* * *
As reported in the Troubled Company Reporter on May 14, 2007,
Fitch Ratings has upgraded Interpublic Group's Issuer Default
Rating to 'BB-' from 'B'. Approximately US$2.3 billion in total
debt as of March 31, 2007 is affected. The Rating Outlook is
Stable.
LITYAN HOLDINGS: Unit Bags Tenaga's MYR57MM Worth of Contracts
--------------------------------------------------------------
Lityan Holdings Bhd's wholly owned subsidiary, Impianas Sdn Bhd,
has been awarded by Tenaga Nasional Berhad various contracts
worth MYR57 million.
In a disclosure with the Bursa Malaysia Securities Bhd, Lityan
said that the contract it won from Tenaga pertains to:
* Supply of Remote Meter Reading (RMR);
* System Low Voltage (LV); and
* Large Power Consumers (LPC) with contract duration of three
years.
Headquartered in Selangor Darul Ehsan, Malaysia, Lityan Holdings
Berhad -- http://www.lityan.com.my/-- sells and provides
maintenance services and rental of computer equipment,
peripherals, telecommunication equipment and related services.
The Company's other activities include provision of building
maintenance and management services, developing and marketing of
new client-server programming tools and application software,
operation of public mobile data network, property investment and
investment holding. The Group carries out its operations in
Malaysia and the Philippines.
On May 10, 2005, the Company was classified as an affected
listed issuer pursuant to Bursa Malaysia Securities Berhad's
Practice Note 17 category. On January 16, 2006, the Company
entered into a conditional Restructuring Agreement to undertake
the Proposed Restructuring Scheme with the intention of
restoring itself onto stronger financial footing via an
injection of new viable businesses.
Lityan Holdings Bhd's unaudited balance sheet as of March 31,
2007, went upside down with an equity deficit of
MYR83.07 million, from total assets of MYR62.01 million and
total liabilities of MYR145.08 million.
MALAYSIA AIRLINES: Wants More Flight Out of Subang Airport
----------------------------------------------------------
Malaysia Airlines asked the government for more flights out of
the Sultan Abdul Aziz Shah Airport in Subang, Bernama News
reports, citing the airline's managing director and chief
executive officer, Datuk Idris Jala.
"We have been given the go-ahead from the government to operate
from Subang and effectively from now, we can fly to Kerteh,
Melaka and Ipoh but the current allocation for flights out of
Subang is too restrictive," Mr. Idris Jala told Bernama at the
company;s extraordinary general meeting.
"We are still talking to the government with regard to opening
other routes beyond these three allocated to us," he added.
Headquartered in Selangor, Malaysia, Malaysia Airlines --
http://www.malaysiaairlines.com/-- services domestic and
international flights. Its global network comprised 32 domestic
and 86 international destinations. Of the 86 international
destinations, 17 were operated in collaboration with airlines
partners.
The carrier posted a loss after tax of MYR1.3 billion for fiscal
year 2005, due to high fuel and operating costs, and
unprofitable routes. In late February 2006, it unveiled a
radical rescue plan to raise MYR4 billion to stay afloat and
return to profitability by 2007. Under the restructuring plan,
the airline pledged to cut its budget by 20% across the board,
terminate many unprofitable routes, freeze recruitment except
for front-line staff, crack down on corruption by encouraging
whistle-blowing and stop corporate sponsorship.
MEGAN MEDIA: Bank of East Asia Seeks Payment on Unit's Loan
-----------------------------------------------------------
Megan Media Holdings Bhd informed the Bursa Malaysia Securities
Bhd that it has been served with a writ of summons pertaining to
a claim by Bank of East Asia Limited amounting to
SGD2,924,399.98 and US$79,500.00 in respect of banking
facilities granted by the bank to its wholly owned subsidiary,
MJC (Singapore) Pte Ltd, in 2006.
The summon was served on June 13, 2007, and is labeled "Bank of
East Asia Limited versus Megan Media Holdings Berhad"
(Shah Alam High Court Suit No. MT3-22-807-2007).
Megan Media told the bourse that it has obtained legal advice on
this action and has engaged solicitors to defend the suit. The
said action is not expected to have any financial or operational
impact on the Group, the company said.
Megan Media Holdings Berhad' s principal activities are
manufacturing and trading data storage media products such as
computer diskettes, video cassette tapes, compact disc
recordable (CD-R's) and digital versatile disc recordable (DVD-
R's). The Group operates in Malaysia, Singapore and
other countries.
The Troubled Company Reporter - Asia Pacific reported on
June 11, 2007, that the Rating Agency Malaysia has downgraded
the long-term rating of Memory Tech Sdn Bhd's MYR320 million Bai
Bithaman Ajil Islamic Debt Securities (2005/2012) ("BaIDS"),
from C3 (with a negative outlook) to D.
The BaIDS carries a corporate guarantee from MTSB's holding
company, Megan Media Holdings Berhad. Concurrently, RAM has
lifted the Rating Watch (with a negative outlook) that had been
placed on MTSB on May 9, 2007, following the failure of MTSB and
MJC (Singapore) Pte Ltd, another wholly owned subsidiary of
Megan Media, to repay their trade facilities amounting to
MYR47.36 million.
MP TECHNOLOGY: CIMB Appoints Receivers to Units
-----------------------------------------------
MP Technology Resources Bhd disclosed with the Bursa Malaysia
Securities Bhd that some of its units received from CIMB Bank
Bhd a letter containing the appointment of receiver and manager
to its subsidiaries.
According to the disclosure, Eng Zan Machinery & Trading Sdn Bhd
and MP Tech Compounding & Extrusion Sdn Bhd respectively have
received their letter from Guan & Associates on May 21, 2007,
stating that Saw Eng Guan has been appointed by CIMB Bank as
Receiver and Manager for the companies.
The Board of Directors of each subsidiary has proceeded
negotiating the settlement scheme with the Receiver, the company
said.
MP Technology Resources Berhad's principal activities are
manufacturing of plastic bags, plastic injection mouldings,
other plastic products, rotogravure, manufacturing and
reconditioning of various plastic and related equipment. Other
activities include trading in plastic resins, compounding and
recycle materials, manufacturing in printing drums for plastic
and packaging industries and investment holding.
The Group operates in Malaysia.
On Jan. 26, 2007, MP Technology Resources Bhd was listed as an
affected issuer to the Amended PN17 category of the Bursa
Malaysia Securities Bhd after posting a MYR66.7-million
shareholders' deficit for the financial year ended Nov. 30,
2006.
SOLUTIA INC: Court Sets July 10 Disclosure Statement Hearing
------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New
York will convene a hearing on July 10, 2007, at 2:30 p.m.
to consider approval of the disclosure statement describing
Solutia Inc. and its debtor-affiliates' Amended Joint Plan of
Reorganization
Objections are due on June 28, 2007, at 5:00 p.m. ET.
Under their proposed Amended Plan and procedures for soliciting
and tabulating votes on that Plan, the Debtors asked the Court
to establish the second business day after the entry an order
approving the Disclosure Statement as the record date for
purposes of determining which creditors are entitled to vote
on the Plan.
The Debtors propose that with respect to any transferred claim,
the transferee will be entitled to receive a solicitation
package and, if the claim holder is entitled to vote with
respect to the Plan, cast a ballot on account of the claim only
if (i) all actions necessary to effectuate the transfer of the
claim have been completed by the Record Date, or (ii) the
transferee files by the Record Date, the documentation required
by Bankruptcy Rule 3001(e) to evidence the transfer, and a sworn
statement of the transferor supporting the validity of the
transfer.
In the event a claim, other than a Noteholder Claim, is
transferred after the Record Date, the transferee will be bound
by any vote or election to participate in the rights offering,
as the case may be, made by the claim holder as of the Record
Date. In the event a Noteholder Claim is transferred after the
Record Date, the transferee of the Noteholder Claim will be
bound by any vote made by the claim holder as of the Record
Date.
About Solutia Inc.
Headquartered in St. Louis, Missouri, Solutia Inc. (OTCBB:SOLUQ)
-- http://www.solutia.com/-- and its subsidiaries, engage in
the manufacture and sale of chemical-based materials, which are
used in consumer and industrial applications worldwide. The
company and 15 debtor-affiliates filed for chapter 11 protection
on Dec. 17, 2003 (Bankr. S.D.N.Y. Case No. 03-17949). When the
Debtors filed for protection from their creditors, they listed
US$2,854,000,000 in assets and US$3,223,000,000 in debts.
Solutia has operations in Malaysia, China, Singapore, Belgium,
and Colombia.
Solutia is represented by Allen E. Grimes, III, Esq., at
Dinsmore & Shohl, LLP and Conor D. Reilly, Esq., at Gibson,
Dunn & Crutcher, LLP. Trumbull Group LLC is the Debtor's claims
and noticing agent. Daniel H. Golden, Esq., Ira S. Dizengoff,
Esq., and Russel J. Reid, Esq., at Akin Gump Strauss Hauer &
Feld LLP represent the Official Committee of Unsecured
Creditors, and Derron S. Slonecker at Houlihan Lokey Howard &
Zukin Capital provides the Creditors' Committee with financial
advice. The Debtors' exclusive period to file a plan expires on
July 30, 2007.
====================
N E W Z E A L A N D
====================
A2 CORP: Incurs NZ$5-Million Operating Loss in FY2007
-----------------------------------------------------
A2 Corporation Limited disclosed its preliminary results for the
2006 - 2007 financial year, adding it is ideally positioned to
capitalise on recent initiatives and begin to grow international
sales. These recent initiatives include the successful launch
of the a2 milk into the US market, a new joint venture in the
Australia market which brings key resources to grow the
Australian business, as well as A2C's continued investment in
intellectual property (patents and trademarks).
A2C posted a 518 percent increase in operating revenue of
NZ$7.590 million for the 12 months ended March 31, 2007
(NZ$1.228 million to March 31, 2006). This increase in sales is
a direct result of buying back the A2 Australian business in May
2006 and the sales associated with that. A2C experienced an
unaudited operating loss of NZ$5.082 million compared with
NZ$925,847 for the previous financial period. This was due to a
combination of the investment in the a2 milk(TM) launch in the
US market as well as resuming control of the important
Australian business operation.
Over the last 3 years, A2C's strategy has been to license its
unique technology and increase its share of the premium
beverages market through alliances with key partners and other
investors. A2C is now moving rapidly forward as an
international FMCG company where scale and strategic
partnerships, especially in the US and Australia, have started
to achieve key milestones and will remain pivotal to its ongoing
growth and success.
Performance highlights
The year ended March 31, 2007, saw many significant milestones
being achieved by A2C as the Company begins to expand
internationally with new marketing channels being opened up in
the US, Australia and Asia.
Cliff Cook, Chairman of A2C says that the Company represents one
of the best examples of commercialising what was once only a
biotechnology concept into a fully fledged FMCG product complete
with unique IP and vastly scalable revenue streams.
"We know that consumers worldwide are willing to pay for a
premium milk beverage especially where the product has
additional health benefits. A2C is finding a positive response
from consumers in all its key markets and we only expect this to
grow as awareness and market penetration continues to grow."
"A2C has turned the corner with its reinvestment in Australia
and launch into the US market."
Cook states that A2C is actively pursing new product
opportunities other than liquid milk.
"We see the potential for a2 milk(TM) to be used in a wide array
of functional milk-based applications such as infant formula,
protein powders and dietary supplements. These additional
opportunities will allow A2C to launch shelf stable, high margin
products, which will provide consumers worldwide with the
premium benefits of a2 milk(TM)".
Cook also says that the positioning of A2C is now much stronger
with the added expertise of new CEO Anthony Lawler who brings a
strong FMCG skill set to the Company.
"We're delighted to have appointed Anthony Lawler as CEO to
manage the A2 Group Companies reflecting the strong focus A2C
now has on growing its share of the FMCG market."
Australia
A2C announced during the year that it was partnering with
Australia's Freedom Nutritional Products Limited
(htttp://www.sonaturalfoods.com.au) in a joint venture to sell
a2 milk(TM) in Australia and Japan.
Anthony Lawler, A2C's CEO says the FNP joint venture which
commenced on June 1st 2007, is a major milestone for the Company
as it provides the potential to rapidly expand the business as
well as capture significant new markets.
"The agreement with FNP is a real vote of confidence in A2C's
business in Australia and we know this new joint venture will
accelerate our market share plus provide quick access into
Asia," says Lawler.
Lawler also adds that "A2C has already built up a strong
presence in Australia with a2 milk(TM) distributed in over 1,000
stores. The new joint venture will bring FNP's significant
dairy industry knowledge, retail grocery sales expertise and key
relationships with retailers which will combine to improve our
unit sales per store and therefore overall sales. FNP also
provides access to milk supply through its majority shareholder,
the Perich family, the largest single dairy milk supplier in New
South Wales.
FNP currently distributes an extensive range of functional foods
including the brands Freedom Foods, So Natural, Paramount and
Brunswick. FNP also has the exclusive rights to the Thorpedo
brand of food and nutritional products which is distributed in
Japan under license with Yakult Honsha.
Geoff Babidge CEO of FNP (a former Managing Director of National
Foods Dairy Division) says
"FNP is delighted to be partnering with A2C and will bring
significant value to the a2 milk(TM) brand in Australia. The a2
milk(TM) brand has a natural synergy with our existing
functional foods and beverage brands such as So Natural and
Freedom Foods. We also believe that consumers for both A2C's
and FNP's brands are seeking healthy food options and therefore
a2 milk(TM) is a natural fit for the FNP product portfolio.
Babidge also states that:
"FNP is looking forward to applying its expertise to help drive
a2 milk(TM) sales in both Australia and other potential Asian
markets".
North America
A2C has had an active presence in the US market since 2005
through its subsidiary A2 Milk Company LLC (A2 Milk LLC) a 50 /
50 joint venture company formed with IdeaSphere Inc.
(http://www.ideasphereinc.com),which specialises in healthy
lifestyle solutions.
Lawler says that the a2 milk(TM) launch in the Mid-West states
of the United States was an outstanding achievement reflecting a
well executed plan which the Company had been working on for
some time with its North American partners.
"We knew that if the groundwork was carefully laid out with
market research, consumer preference testing and the
establishment of effective distribution channels before the a2
milk(TM) product was released we would be in a better position
to then take A2C into even bigger consumer markets more quickly.
A2 Milk LLC has an exclusive distribution agreement with Hy-Vee
supermarkets (http://www.hy-vee.com)in the Mid-West. Hy-Vee
ranks among the top 15 supermarket chains in the United States
with 210 stores and has a focus on premium health and wellness
products.
"A2 Milk LLC intends to take these experiences from our recent
launch in Hy-vee and launch a2 milk(TM) onto a national scale in
the US and the company will confidently make plans to invest in
the infrastructure to support this growth."
Cook notes that the US is likely to remain A2C's best revenue
growth opportunity well into the foreseeable future.
"The US market signifies tremendous potential for revenue growth
and for expanding A2C's business as the American region
continues to be one of the world's biggest and wealthiest
consumer and beverage markets," says Cook.
Mark Fox CEO of IdeaSphere Inc., says that the a2 milk(TM)
positioning in the US market through the distribution with
Original Foods and Hy-Vee is just the right springboard for the
company to move its products to even bigger markets.
"The launch of a2 milk in the US has been a real success with
the product resonating with consumers from Nebraska, Iowa,
Kansas, Illinois, Missouri, South Dakota, to Minnesota. We have
no doubt that this has already created significant momentum for
the brand and product that will drive ongoing sales and revenue
for A2 Milk LLC in the US. Furthermore we are particularly
excited by the potential a2 milk(TM) offers in other food forms
such as milk powders and baby formulas as they represent high
value opportunities," says Fox.
Commercialisation
A2C continued its R&D programme as part of ongoing product
development and commercialisation of a2 milk(TM) products. The
Company secured a further US patent relating to the testing and
breeding of a2 milk(TM) producing animals, as well as patent
rights in Asian territories that relate to the production and
application of a2 milk.
Cook says the future of A2C will depend heavily on expanding and
carving out a bigger share for the Company's leading product
range of value added functional foods from fresh milk to milk
powder.
"In many ways A2C is only starting to ramp up the potential
spin-offs of various a2 milk(TM) products as well as opening up
new vast markets. Thus, the future is looking very bright for
building a quick uptake for a2 milk(TM) as in places such as
Australia, US and Asia. A2C has only really scratched the
surface, and are just starting to see the first real demand."
Lawler notes a key focus for A2C is the potential for the sale
of new a2 milk(TM) products such as infant formula and protein
powders to take advantage of the significant market
opportunities in Australia, US and Asia as has been highlighted
by the Company's joint venture partners. "While the opportunity
in fresh milk will always be substantial, the opportunity in
a2milk(TM) powders brings the economic benefit of shelf stable
of products which can be manufactured in one central place and
exported around the world. This central manufacturing of
powders will allow for economies of scale and efficiencies,"
says Lawler.
Capital Raising
A2C has previously indicated that it was likely that a capital
raising would be undertaken in the first half of the 2008
financial year.
"We will soon be in a position to advise the market about the
approach A2C intends to take following completion of an
assessment of capital requirements based on the various projects
currently under way or under investigation".
Looking ahead, Lawler says that A2C is going to use the positive
momentum from the last 12 months to invest additional capital to
rapidly expand the business in the Australian, United States and
Asian markets.
About A2 Corporation
New Zealand-based A2 Corporation Ltd. --
http://www.a2corporation.com/-- is engaged in the sale and
production of beta-casein A2 milk products. The company owns
and licenses intellectual property that enables the
identification of cattle for the production and subsequent
marketing of A2 Milk. During the fiscal year ended March 31,
2006, the company acquired A2 Australia Pty Ltd. In April 2006,
the company reacquired the business of A2 Australia Pty Ltd from
F&N Dairy Investments Limited. A2 Milk Company LLC provided the
Company with a research basis for launching A2 Milk in the North
American market.
The company suffered at least three years of operating losses:
NZ$5.082 million in FY2007, NZ$925,847 in FY2006 and
NZ$9,017,633 in FY 2005.
AIR NEW ZEALAND: Extends Vancouver-Auckland Non-Stop Service
------------------------------------------------------------
Air New Zealand's new non-stop service between Vancouver, Canada
and Auckland, New Zealand will now operate year-round, offering
additional flights to those newly scheduled for the peak travel
season. The increase comes in response to the strong demand
from customers eager to fly directly to New Zealand.
Early this year, Air New Zealand announced that its new non-stop
route between Vancouver and Auckland would be available from
November 2007 through March 2008, to coincide with the busiest
travel season between the two countries. Since the
announcement, forward bookings have been very strong, prompting
the airline to extend the offer, making the service available
year-round.
"New Zealand has always been a popular destination choice for
Canadians," said Roger Poulton, Air New Zealand Vice President -
the Americas. "Since our announcement of the new route in
February, we've been inundated with inquiries about traveling
outside of the seasonal schedule. With such great demand, it
seemed logical to give customers what they wanted."
With the launch of the year-round non-stop service, Air New
Zealand will provide three non-stop flights each week between
Vancouver and Auckland during the months of November through
March and July through August. The service will be available
twice-weekly for the remaining months of the year; offering
Canadians access to a variety of experiences throughout the
seasons.
"We anticipate our Canadian customers will appreciate that the
service is a fast and convenient route to many Australian
destinations too," said Poulton.
The new route reduces travel time to a little over 14 hours,
whereas previous itineraries from Vancouver to New Zealand
totalled an average of 20 hours. Customers will enjoy a direct
flight aboard Air New Zealand's new fleet of Boeing 777-200ERs,
featuring lie-flat beds, vast entertainment options and award-
winning food and wine. Star Alliance partner Air Canada will
also be code sharing on this service.
About Air NZ
Based in Auckland, New Zealand, Air New Zealand is the country's
flag air carrier, with domestic and international passenger and
freight operations, and an aviation engineering business.
As reported in the Troubled Company Reporter - Asia Pacific on
Sept. 2, 2005, Moody's Investors Service affirmed its Ba1 issuer
rating on Air New Zealand Limited after the airline announced
its annual results for FY2005. Air NZ's rating reflected its
dominant position in the New Zealand domestic market, with
around 80% market share, and the profitability of domestic
operations following their restructuring to a low-cost network
model. Also supporting Air NZ's rating was its solid liquidity
position, with cash balances of NZ$1.071 billion held as at
June 30, 2005.
However, while Air NZ has a solid position in New Zealand and
other parts of the international network are performing well,
intense competition on trans-Tasman routes has resulted in it
being unprofitable for Air NZ. International competition also
limits Air NZ's ability to expand. Its management is also aware
of the airline's vulnerability to external shocks and the
actions of key competitors.
AMERICAN GREETINGS: Moody's Holds Ba1 Rating on Low Growth Rates
----------------------------------------------------------------
Moody's Investors Service affirmed American Greetings
Corporation's Ba1 corporate family rating, but revised its
ratings outlook to stable from negative.
Moody's also affirmed the ratings on the company's senior
secured credit facilities and senior unsecured notes. The
ratings outlook revision reflects the company's stronger than
expected cash flows, despite significant investments to support
its strategic card initiative and additional scan-based trading
rollouts.
As a result, the company's credit metrics exceeded the amounts
Moody's had stipulated in May 2006 as conditions for revising
the outlook to stable (debt to EBITDA below 3.0 times and free
cash flow to debt above 10%). The outlook revision also
reflects the recent reduction in the delay draw term loan
commitment to US$100 from US$300 million, which Moody's views as
more conservative financial policy given the facility was put in
place, in part, to support share repurchases.
While no ratings changed as a result of the reduction in the
delay draw term loan commitment, the LGD point estimate on the
senior secured credit facilities was revised to LGD 2, 21% from
LGD 2, 28% reflecting the increased proportion of subordinated
debt in the capital structure. Moody's also revised the point
estimate on the senior unsecured notes to LGD5, 75% from LGD5,
81%.
Ratings Affirmed:
-- Corporate family rating at Ba1;
-- Probability-of-default rating at Ba1;
-- US$350 million guaranteed senior secured revolving credit
facility due 2011 at Baa3 (LGD2, 21%);
-- US$100 million guaranteed senior secured delay draw term
loan facility due 2013 at Baa3 (LGD2, 21%);
-- US$200 million senior unsecured notes due 2016 at Ba2
(LGD5,75%);
-- US$22.7 million senior unsecured notes due 2028 at Ba2
(LGD5, 75%).
American Greetings' Ba1 corporate family rating is primarily
driven by the significant business risks inherent in the
greeting card industry that is characterized by low or declining
growth rates, weak consumer branding, strong competition, and
increased retailer bargaining power that is driven by
consolidation.
In Moody's view, the company's current investment grade-like
credit metrics are not sufficient to offset these business
risks. The rating also considers the company's financial policy
(given its appetite for material share repurchases) which we
continue to view as aggressive. Notwithstanding these concerns,
the rating is supported by the company's leading and stable
market position in the U.S. greeting card industry with
approximately 30% to 35% market share (and a stronger position
with mass merchandisers), its over 100-year operating history,
the predictable demand for its products, and long-standing
relationships with retail customers. Additionally, the
company's long-term contracts and scan-based trading systems
provide a meaningful barrier to entry.
The stable outlook reflects Moody's expectation that American
Greetings will maintain its solid debt protection measures, and
begin to realize measurable benefits from its strategic card
initiative. It also anticipates that the company will mostly
fund future share repurchases with internally generated cash
flows while only experiencing moderate declines in revenues,
such that debt to EBITDA remains below 3.0 times, EBITA
interest coverage exceeds 3.5 times, and free cash flow to debt
is sustained in the mid-teen levels.
Cleveland, Ohio-based American Greetings Corporation (NYSE: AM)
-- http://corporate.americangreetings.com/-- manufactures
social expression products. American Greetings also
manufactures and sells greeting cards, gift wrap, party goods,
candles, balloons, stationery and giftware throughout the world,
primarily in Canada, the United Kingdom, Mexico, Australia, New
Zealand and South Africa.
TRUSTPOWER LTD: Net Profit Up 20% to NZ$97 Million in FY2007
------------------------------------------------------------
TrustPower Limited's consolidated operating surplus after tax
was NZ$97.4 million for the year ended March 31, 2007,
representing a 20% increase on the result for the 2006 financial
year.
Earnings before interest, tax, depreciation and amortisation
grew by 6% to NZ$196.4 million from NZ$185.6 million in the
previous year.
Operating revenue of NZ$626.3 million decreased 7% on the
previous year as a result of lower energy prices charged to
those customers paying spot market prices. Total volume sold was
4,575 GWh compared with 4,724 GWh in the year to 31 March 2006.
Customer numbers reduced slightly to 219,000 at 2007 year end
versus 220,000 a year ago.
The New Zealand electricity market for the early months of the
2007 financial year was characterised by lake storage levels and
inflows well below average leading to higher spot electricity
prices. This situation turned around in the second half of the
year following high inflows across the country in November and
December causing national hydro storage to rise above average
levels with a consequent drop in spot electricity prices.
Generation production of 1,941 GWh for the year was up 8% on the
previous year but slightly down on long term average.
Operating expenses including energy and line costs decreased 12%
on the previous year, primarily driven by lower electricity spot
prices and the increased use of the Group's own generation
production. Net profit after tax, return on average
shareholders' funds, was 8.6% taking into account the
revaluation of generation assets at year end (last year 9.2%).
Group operating cash flow was NZ$135.5 million for the 2007
financial year versus NZ$118.9 million in the previous year.
TrustPower's balance sheet as at March 31, 2007, remains strong.
Shareholders' funds have increased to NZ$1,371.8 million from
NZ$896.5 million. Generation assets have been independently
revalued as at March 31, 2007, as required by Financial
Reporting Standards. The revaluation has resulted in an uplift
in the value of generation assets of NZ$456 million and this is
reflected in the asset revaluation reserve at balance date. The
revaluation was completed by Deloitte Corporate Finance on a
discounted cash flow basis. The increase in generation asset
values reflects the higher earning potential of TrustPower's
renewable generation assets and the likely impact on future
electricity prices of higher gas input costs for gas-fired
generation following the run down of Maui's gas reserves and the
possible impact of carbon charging on thermal generators.
Included in accounts payable and accruals is an amount of
NZ$36.8 million relating to milestone payments due under the
Tararua Stage III turbine supply contract. A similar amount was
held in year end cash balances following settlement of foreign
exchange hedge contracts matching the turbine supply contract
obligations.
Debt (including subordinated bonds) to debt plus equity was 27.1
% at year end 2007, being slightly lower than the 2006 year end
position.
TrustPower continues to maintain high levels of bank credit
lines. Including subordinated bonds, the Company has NZ$710.9
million of committed debt funding in place. These debt
facilities were drawn to NZ$515.0 million as at March 31, 2007.
TrustPower's New Zealand generation development programme
continues to progress in line with expectations. The 93 MW
Stage III expansion of the Tararua Wind Farm is progressing
well. At the end of April, eighteen of the thirty one 3 MW
turbines were operating. Full commissioning of the wind farm is
expected to occur by July 31, 2007.
The 5 MW enhancement to the Waipori hydro generation scheme is
well advanced and target completion is now December 2007.
The resource consent hearing for the proposed 72 MW Wairau hydro
generation scheme in Marlborough finished in December 2006 after
a six-month hearing process. The consent decision is expected
to be received shortly.
A resource consent hearing for the revised 46 MW hydro
generation scheme at Arnold on the West Coast has been scheduled
to commence in September 2007. A resource consent hearing for
the proposed 200 MW Lake Mahinerangi wind farm at Waipori in
Otago is scheduled to commence mid May and is expected to take
two to three weeks. TrustPower continues to hold the view that
this project would be developed in 100 MW stages subject to
granting of a resource consent and confirmation of satisfactory
project economics.
TrustPower is investigating the potential for a wind farm of up
to 185 MW at Kaiwera Downs near Gore in the South Island. Land
access arrangements are nearing completion and wind monitoring
is currently being undertaken. A resource consent application
is expected to be lodged in the last quarter of 2007.
Other hydro and wind opportunities continue to be actively
investigated particularly in the North Island.
Good progress is being made on the development of the 88 MW
Snowtown wind farm in South Australia. Landowner arrangements
and key project contracts have been finalised. Civil works will
commence shortly. The level of community support for the
construction of the wind farm is very pleasing. Forty two 2.1
MW wind turbines are scheduled to be progressively commissioned
between April and November 2008 under a fixed price Engineer
Procure and Construct Contract with Suzlon Energy Australia Pty
Ltd. Other opportunities are being investigated in Australia.
Expensed generation development costs for the year were NZ$10.3
million compared with NZ$15.0 million in 2006. This reflects
the generation development opportunities being progressed,
including preliminary design, environmental investigations and
resource consent application costs.
The Government is currently reviewing around 3,000 submissions
with respect to its draft New Zealand Energy Strategy to 2050.
TrustPower has made a combined submission on the NZES and
related Energy Policy documents.
TrustPower supports the vision of the NZES to achieve a reliable
and resilient system delivering sustainable, low emissions
energy by providing a clear direction, maintaining security at
competitive prices, maximising energy efficiency and adopting
environmentally sustainable technologies.
TrustPower has the following key concerns in relation to the
NZES:
i) There is an urgent need for clarity in respect to future
generation alternatives and charges for greenhouse gas
emissions in the energy sector.
ii) The 2004 and 2005 amendments to the Resource Management
Act have been ineffective. Barriers which presently exist
within the RMA consenting process need to be removed.
TrustPower advocates a streamlined submission process,
national guidance through National Policy Statements and a
voluntary mechanism for direct referral of resource
consent applications to the Environment Court.
iii) The Government should consider what changes are necessary
within the RMA process to remove barriers to electricity
generators gaining access to land, including giving
electricity generators requiring authority status where
there is wide community support or a project is of
national importance.
iv) Baseline information relating to relative costs of new
demand and supply must be accurate. Some of the
assumptions used in the draft NZES are incorrect, in
particular the understatement of the cost of new entrant
wind generation.
v) The current proposal to continue to apply High Voltage
Direct Current charges to existing and new South Island
generators will potentially mean no South Island renewable
generation is built in the foreseeable future and this
will have a major impact on the ability of the Government
to meet its renewable energy objectives.
TrustPower's hope is that clear policy direction will be
provided to the energy industry following the submission, review
and consultation process on the draft NZES and that the policy
direction is supportive to achieving the vision for the energy
sector articulated in the draft document.
In early 2006 the Commerce Commission commenced a review into
the market behaviour of generator/retailers. No target
completion date has been advised.
The Electricity Commission is also conducting a review of the
effectiveness of how the current wholesale electricity market is
operating. The Commission has advised that this review will be
completed by the end of 2007. These reviews create an
environment of continuing uncertainty for the electricity
sector.
While it is too early to make predictions about the 2008
financial year, it is worth noting that the Company is currently
well positioned to meet its customers' needs this winter.
TrustPower's hydro storage levels are around average for this
time of year and, together with contracted electricity hedges,
should enable the Company to meet its electricity sales
obligations within comfortable spot market purchasing risk
parameters.
Forecast capital expenditure in the 2008 financial year for
committed generation development projects is expected to be
around NZ$150.0 million.
Generation development costs to be expensed in the 2008
financial year are projected to be around NZ$8.0 million.
The Directors are pleased to announce a fully imputed final
dividend of 14 cents per share payable June 8, 2007 (record date
of 25 May 2007). This together with an interim dividend of 13
cents per share provides a total payout of 27 cents per share
for the 2007 financial year compared with 23 cents per share for
the 2006 financial year, representing dividend growth of 17%.
About TrustPower
TrustPower Limited -- http://www.trustpower.co-- owns and
operates 34 power stations and produces electricity exclusively
from renewable sources. The company's power stations produce
enough electricity for 260,000 Kiwi households.
With assets of close to NZ$1.4 Billion, TrustPower is majority
New Zealand owned and is listed on the New Zealand stock
exchange. TrustPower's head office is in Tauranga, with
regional offices in Auckland, Wellington, and Christchurch.
* * *
The Troubled Company Reporter - Asia Pacific, on June 12, 2007,
listed TrustPower Ltd.'s bonds as distressed. The bonds have
these coupon and maturity dates:
Coupon Maturity Price
------ -------- -----
8.300% 09/15/07 8.25
8.300% 12/15/08 8.30
8.500% 09/15/12 8.70
8.500% 03/15/14 8.40
=====================
P H I L I P P I N E S
=====================
ACESITE: Annual Stockholders' Meeting Set for June 20
-----------------------------------------------------
Acesite (Phils.) Hotel Corp. will hold its annual meeting of
stockholders at 4:00 pm on June 20, 2007, at the Nautilus Room
of the Manila Pavilion Hotel, United Nations Avenue corner Maria
Orosa St., in Ermita, Manila.
The meeting will consider these matters, among others:
* Approval of the annual report and audited financial
statements;
* Election of directors for 2007-2008; and
* Appointment of external auditors and legal counsel.
The record date for the meeting is June 1, 2007.
Formerly known as Delbros Hotel Corporation, Acesite (Phils.)
Hotel Corporation -- http://www.manilapavilion.com.ph/-- is a
foreign-owned domestic corporation incorporated to engage in
hotel operations and investing. DHC owns the Holiday Inn Manila
Pavilion Hotel, a deluxe hotel situated along United Nations
Avenue in Manila. The operations of the latter are being
managed by Holiday Inn Worldwide. A major customer of the hotel
is the Philippine Amusement and Gaming Corporation, which
operates the Casino Filipino - Pavilion.
Debt Default and Restructuring
An event of default occurred with respect to the Acesite's
payment of its US$15 million loan with the Singapore Branch of
the Industrial and Commercial Bank of China, which matured on
March 31, 1998. On June 3, 2003, the loan was restructured by
ICBC, which stipulated six semi-annual installment payments of
principal and interest until April 2006. In July 2004, the
company's new management requested for a reprieve on loan
principal payments due for the period, which the company
suggested to be placed at the end of the term of the Amended
Agreement. The outstanding principal balance of the ICBC loan
as of March 31, 2006, is US$9.18 million. Management is still
negotiating with ICBC for a rescheduling of payment on the
remaining principal balances.
Material Lawsuits
Acesite is party to a case that involves a PHP30.15 million
petition for the Bureau of Internal Revenue to refund Extended
Value Added Tax payments made from July 1996 to October 1997.
Both the Court of Tax Appeals and then later the Court of
Appeals ruled in favor of Acesite, and ordered the BIR to refund
PHP30.05 million. The case is presently with the Supreme Court
on further appeal by the BIR.
Acesite also has a PHP5.26 million petition for the City
Treasurer of Manila to refund local taxes payments made on April
19, 2002. The case is still pending with the Regional Trial
Court in Manila, Branch 15
APC GROUP: Clarifies News on PLDT's Acquisition of Philcom
----------------------------------------------------------
APC Group Inc. told the Philippine Stock Exchange that it has no
knowledge of any discussion with the Philippine Long Distance
Telephone Co. for the acquisition of its subsidiary, Philippine
Global Communications Inc.
On Friday last week, the BusinessMirror published an article
that PLDT is allegedly in discussions to acquire Philcom and
that the two firms have already entered into a facility
management arrangement to manage the firm in Mindanao.
According to the article, Philcom owes PLDT around PHP5 billion,
and PLDT Chairman Michael Pangilinan said that the debt will be
considered in the acquisition price.
In its letter to the PSE, APC said that the supposed facility
management agreement with PLDT had already expired and is being
renegotiated. APC also told the PSE that Philcom's outstanding
liability is about PHP2 billion pesos and not PHP5 billion.
APC Group, Inc. was incorporated on October 15, 1993, with the
primary purpose of engaging in oil and gas exploration and
development in the Philippines. The company is 46.6% owned by
Belle Corporation. APC has investments in telecommunications, a
cement project, and manpower outsourcing businesses.
The Troubled Company Reporter - Asia Pacific reported that the
company had a capital deficiency as of September 30, 2006 and
December 31, 2005 amounting to PHP8.89 billion and PHP8.70
billion respectively.
Going Concern Doubt
After auditing the company's financial statements for the year
ended December 31, 2006, Marydith C. Miguel at Sycip Gorres
Velayo and Co. raised significant doubts on APC Group, Inc.'s
ability to continue as a going concern. The auditor cited the
company's recurring losses arising principally from the losses
of PhilCom and PhilCom Corporation, which affected the ability
of both companies to service their maturing obligations on a
timely basis. In addition, the company's consolidated current
liabilities exceeded its consolidated current assets as of
December 31, 2005, and 2004. Further, the restructuring of the
long-term debt of the two PhilCom entities are still under
negotiation with the creditors.
Net loss for the year ending Dec. 31, 2006, amounted to PHP790.2
million compared to PHP874.7 million in 2005.
CHIQUITA: Inks Plantation Improvement Pact with Coosemupar
----------------------------------------------------------
Chiquita Brands International has signed a PAB10-million accord
with Panamanian banana producer cooperative Cooperativa de
Servicios Multiples de Puerto Armuelles aka Coosemupar for the
improvement of plantations, Jahir Lombana at Fresh Plaza
reports.
Fresh Plaza relates that under the agreement, Chiquita Brands
must purchase Coosemupar's production. The accord expires in
September 2007. From that date on, Coosemupar must negotiate
with Chiquita Brands about the terms for a new pact until 2013.
According to Fresh Plaza's Mr. Lombana, growers are worried on
the new results, saying that for the last three years Chiquita
Brands paid less than the production costs due to the system of
payment.
Chiquita Brands will invest some PAB6.1 million in the
plantations. The financial injection from Chiquita Brands was
important. Still, a fair price is needed to make the activity
viable, Fresh Plaza's Mr. Lombana notes, citing Coosemupar
manager Hirisnel Sucre.
Oil prices affected costs of production and banana workers are
afraid on the effects of the current situations to keep the
company on business. There must be a new accord to regulate
prices of the boxes, the Banana Workers Union Secretary
Salustiano De Gracia told Fresh Plaza's Mr. Lombana.
Chiquita Brands told Reuters that banana prices dropped 1% in
its core European markets on a local currency basis and were
flat in North America for the two-month period from April to May
2007, compared to the same period in 2006.
According to Chiquita Brands' statement, banana volume sold in
the core European markets fell by 4%, while the volume in North
America increased 8%.
RTT News notes that Chiquita Brands' banana prices in its core
European markets decreased, an indication of the continued
effect of the EU regulatory changes implemented on Jan. 1, 2006.
The changes led to a boost in industry volume and price
competition. Volume sold in the core European markets dropped
by 4% due to Chiquita Brands' strategic determination to
concentrate on profitable volume and maintaining its premium
position in the markets.
Pricing in Asia Pacific and the Middle East increased 5% year-
on-year on a US dollar basis, mainly due to significant
improvement in local pricing in Japan, partially counterbalanced
by unfavorable dollar-yen exchange rates, RTT News relates.
Meanwhile, the total volume of retail value-added salads in the
Salads and Healthy Snacks segment rose 1% year-over-year.
Chiquita told RTT News that due to consumer concerns on the
safety of packaged salad products, it expects decreased sales
and reduced margins to continue through at least the third
quarter 2007.
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: Europe Sales Volume Down 4% in April-May 2007
--------------------------------------------------------------
Chiquita Brands International Inc. provided an intraquarter
update for the second quarter 2007, including Chiquita banana
and Fresh Express value-added salad prices and volumes for
April-May 2007 in its Banana and Salads and Healthy Snacks
segments, respectively.
Banana Segment
Year-over-Year Percentage Change (1)
April-May 2007 vs. April-May 2006
% of Total
CHIQUITA BANANAS Pricing Volume (2) Volume Sold
Core European Markets (3)
U.S. dollar basis (4) +7 % -4 % 37 %
Local currency basis -1 %
North America 0 % +8 % 43 %
Asia Pacific and the
Middle East (5) +5 % -17 % 12 %
Trading Markets -11 % +293 % 8 %
(1) These statistics may not be indicative of future
results.
(2) Total volume sold includes all banana varieties, such
as Chiquita to Go, Chiquita minis, organic bananas
and plantains.
(3) The company's "core" European markets include the
member states of the European Union (except new
entrants Romania and Bulgaria, which continue to
be reported in "trading" markets), Switzerland,
Norway and Iceland.
(4) Prices on a U.S. dollar basis do not include the impact
of hedging.
(5) In this region, the company primarily operates
through joint ventures, and most business is invoiced
in U.S. dollars.
Banana prices in the company's core European markets were down 1
percent year-on-year on a local currency basis (up 7 percent on
a U.S. dollar basis), reflecting the continued impact of E.U.
regulatory changes implemented on Jan. 1, 2006, which have
resulted in an increase in industry volume and price
competition. Volume sold in the core European markets decreased
by 4 percent, due to the company's strategic determination to
focus on profitable volume and maintaining its premium position
in these markets.
North American banana pricing was flat year-over-year. While
base contract prices increased, this improvement was partially
offset by lower spot-market pricing and lower year-on-year
surcharges linked to a third-party fuel price index. Banana
volume sold in the region rose 8 percent, reflecting
distribution gains at several top-25 customers as well as the
company's recovery from weather-related disruptions in the
previous year.
In Asia Pacific and the Middle East, pricing rose 5 percent
year-on-year on a U.S. dollar basis, primarily as a result of
significant improvement in local pricing in Japan, partially
offset by unfavorable dollar-yen exchange rates. Volume in this
region fell by 17 percent year-over-year, primarily related to
supply constraints in the Philippines, which resulted in lower
yields of premium-quality fruit.
In the company's trading markets, which consist primarily of
European and Mediterranean countries that do not belong to the
European Union, decreased pricing of 11 percent year-over-year
reflects the transition in Turkey to a year-round service
commitment in 2007, rather than opportunistic entry in the
spot market. In addition, volume growth in this region was
also driven by the company's year-round presence in Turkey.
Salads and Healthy Snacks Segment
Year-over-Year Percentage Change (1)
April-May 2007 vs. April-May 2006
FRESH EXPRESS RETAIL
VALUE-ADDED SALADS Net Revenue Per Case Volume
North America 0 % +1 %
(1) These statistics may not be indicative of future
results.
In the Salads and Healthy Snacks segment, total volume of retail
value-added salads was up 1 percent year-over-year in the two-
month period. Since mid-September 2006, the company's Fresh
Express operations have been impacted by consumer concerns
regarding the safety of fresh spinach and other packaged leafy
greens in the United States, despite the fact that no confirmed
cases of consumer illness were linked by the U.S. Food and Drug
Administration to Fresh Express products. As noted previously,
the company expects reduced sales and decreased margins to
continue through at least the third quarter 2007 due to consumer
concerns about the safety of packaged salad products. Net
revenue per case was flat year-over-year.
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%).
DEL MONTE: Earns US$36.7 Million in 4th Quarter Ended April 29
---------------------------------------------------------------
Del Monte Foods Company reported net sales for the fourth
quarter ended April 29, 2007, of US$940.1 million, as compared
with a fourth quarter net sales of US$799.2 million last year,
an increase of 17.6%. Income from continuing operations for the
fourth quarter fiscal 2007 was US$36.8 million, compared to
US$41.7 million in the previous year. Net income for the fourth
quarter fiscal 2007 was US$36.7 million, as compared with a net
income of US$57.9 million for the fourth quarter in 2006.
The 17.6% increase in net sales was driven by the acquisitions
of Meow Mix and Milk-Bone. Growth from new products and pricing
also contributed to the increase in net sales. These gains were
partially offset by volume declines.
Full Year 2007 Results
The company reported net sales for fiscal 2007 of US$3.4
billion, as compared with US$3 billion last year, an increase of
13.9%. Income from continuing operations was US$113 million, as
compared with US$137 million in the previous year.
The 13.9% increase in net sales was driven by the Meow Mix and
Milk-Bone acquisitions. Growth from new products and pricing
also contributed to the increase in net sales. These gains were
partially offset by lower volume driven primarily by competitive
marketing dynamics and elasticity in pet food, pricing
elasticity in the Consumer Products business, overall business
performance in StarKist Seafood and lower volume in vegetables.
As of April 29, 2007, the company listed total assets valued at
$4.6 billion, total liabilities of US$3.1 billion, and total
stockholders' equity of US$1.5 billion.
The company held US$13 million in unrestricted cash as of April
29, 2007, as compared with US$459.9 million in unrestricted cash
and $43.3 million in restricted cash as of April 30, 2006.
"This quarter and full year's solid financial performance were
driven by the ongoing successful execution against our strategic
objectives," said Richard G. Wolford, chairman and chief
executive officer of Del Monte Foods.
"In fiscal 2007 Del Monte made several structural changes which
substantially improved the earning potential and competitiveness
of our company. The successful acquisition and integration of
Meow Mix and Milk-Bone significantly enhanced the growth and
earnings profile of our overall company and significantly
upgraded our competitive strength in Pet Products. In addition,
successful pricing actions coupled with our internal cost
reduction initiatives and the transformation plan enabled us to
address significant inflationary cost pressures during the year
and going forward. We are extremely pleased with the
performance of the pet acquisitions, which continue to exceed
expectations. Overall, we continued our solid track record of
generating strong cash flow well ahead of our fiscal 2007
guidance. We still however must deal with challenges, including
inflationary cost pressures and our StarKist Seafood business.
Despite these ongoing headwinds, we believe we have the
foundation in place to deliver strong [fiscal 2008]
performance."
First Quarter and Fiscal 2008 Outlook
For the fiscal 2008 first quarter, the company expects to
deliver sales growth of about 5% to 7% over net sales of
US$674.1 million in the first quarter of fiscal 2007.
For fiscal 2008, the company expects sales growth of 5% to 7%
over fiscal 2007 net sales. Fiscal 2008 net sales growth is
expected to be driven primarily by growth across the company's
portfolio, in particular the Meow Mix and Milk-Bone
acquisitions. During the fourth quarter, the company announced
additional pricing actions effective April 30, 2007, in Pet
Products in response to higher raw ingredient costs related to
the demand for ethanol.
In fiscal 2008, the company expects cash provided by operating
activities, less cash used in investing activities to be about
$180 million to US$200 million. The company's adjusted cash
flow in fiscal 2007 was US$195.9 million, which compares
favorably to its fiscal 2007 guidance of US$150 million to
US$170 million, both of which excluded the purchase of Meow Mix
and Milk-Bone.
About Del Monte Foods
Based in San Francisco, California, Del Monte Foods Company
(NYSE: DLM) -- http://www.delmonte.com/-- produces and
distributes processed vegetables, fruit and tomato products, and
pet products. The products are sold under Del Monte, Contadina,
S&W, Starkist, College Inn, 9Lives, Kibbles 'n Bits, Meow Mix,
Milk-Bone, Pup-Peroni, Snausages, Pounce, and Meaty Bone. The
Group has food-processing plants in South America and has
subsidiaries in Venezuela, Colombia, Ecuador and Peru. The
production facilities are operated in California, the Midwest,
Washington and Texas, as well as 7 distribution centers. The
company also has operations in the Philippines and India.
* * *
Del Monte Foods Company continues to carry Standard & Poor's BB-
long-term foreign and local issuer credit ratings and B1 short-
term foreign and local issuer credit ratings. The ratings
outlook remains negative.
The company also carries Fitch's BB- long-term issuer default
rating.
IPVG CORP: Annual Stockholders' Meeting Set for July 26
-------------------------------------------------------
IPVG Corp. will hold its annual stockholders' meeting on
July 26, 2007, at 10:00 am, at the company's principal office at
Tower II of the RCBC Plaza, in Ayala Avenue, Makati City.
Under the company's by-laws, the meeting should be held every
last Friday of June. However, during a special meeting of the
Board of Directors held last June 13, the Board decided to
postpone the meeting to make sure that all relevant materials
are prepared and sent to stockholders within the time allowed by
the Securities and Regulations Code.
The record date for the meeting is July 1, 2007.
About IPVG Corp.
IPVG Corporation -- http://www.ipvg.com/-- is engaged in the
information technology and communications business with
interests in Information Technology and Telecommunications; On-
line Gaming; and Business Process Outsourcing.
IPVG reaches its customers through collaboration with
international corporations that have proven to be market leaders
in their respective geographic markets and industries. Its
current partners include Fortune 1000 companies listed on the
New York Stock Exchange, such as Pacific Century Cyberworks Inc.
and IDT. The company can offer established product and
proprietary business knowledge to the Philippine market by
pairing each of its business subsidiaries with strategic
partners.
The TCR-AP reported on May 15, 2007 that the corporation posted
a net loss of PHP102.1 million for the year ended Dec. 31, 2006,
the company's third consecutive annual net loss after
PHP43.0 million in 2005 and PHP6.2 million in 2004.
PHIL. BANK OF COMMS: Posts PHP234.93-Million Net Income for 2006
----------------------------------------------------------------
Philippine Bank of Communications posted a PHP234.93-million net
income for the year ended December 31, 2006, up 167% from the
PHP87.89-million net income posted for the year 2005.
For the year 2006, the company earned a net interest income of
PHP2.66 billion, on PHP3.55 billion interest income and
PHP2.62 billion interest and finance charges, and operating
income of PHP2.66 billion. The company also incurred total
operating expenses of PHP2.11 billion for 2006.
As of December 31, 2006, the company had total assets of
PHP55.79 billion and total liabilities of PHP45.7 billion,
resulting in a total equity of PHP10.08 billion.
Total Assets grew 6.34% to P55.790 billion as of December 31,
2006, a PHP3.326 billion increase from the reported PHP52.463
billion at year-end 2005. The net effect of the increases on
investments in government securities and other peso and dollar
denominated sovereign bonds by PHP4.55 billion, demand deposit
account with BSP by PHP1.3 billion, ROPA by PHP541 million and
the reduction in the bank's Inter-bank lending, Loans and Other
receivables, Due from Other Banks, Other Assets- deferred
charges by PHP1.017 billion, PHP946 million, PHP417 million and
PHP693 million respectively accounted for the growth. Funding
the growth in assets was a PHP1.62 billion and PHP1.12 billion
increase in total deposits and deposit substitutes.
The company's 2006 annual report can be downloaded for free at:
http://www.pse.com.ph/html/ListedCompanies/pdf/2007/PBC_17A_Dec2
006.pdf
About PBCom
Headquartered in Makati City, Philippines, Philippine Bank of
Communications -- http://www.pbcom.com.ph/-- provides different
products and services through its different divisions and it has
a broad range of credit facilities, which are either denominated
in local currency or foreign. Its Trust Division handles common
trust funds, investment advisory accounts and employee benefit
trusts. Aside from these, the bank also offers money market
placements and traditional products such as peso deposits.
Fitch Ratings gave Philippine Bank of Communications an
Individual Rating of 'D/E.'
PHIL. LONG DISTANCE: In Discussions to Acquire Equity in Philcom
----------------------------------------------------------------
The Philippine Long Distance Telephone Co. revealed to the
Philippine Stock Exchange that it is in talks with Philippine
Global Communications Inc. for a possible acquisition of equity
interest in the firm.
Specifically, PLDT told the PSE that it is willing to convert
into equity its receivables from Philcom Corp., which, along
with Philippine Global Communications, owed a principal amount
of PHP2.2 billion since December 31, 2001.
Philcom and Philippine Global Communications comprise the
Philcom Group.
Last Friday, the BusinessMirror published an article stating
that PLDT is discussing with Philippine Global Communications'
shareholders for possible acquisition, and is also seeking to
close a similar deal with a firm from the Philippine Association
of Private Telephone Companies. The article also quoted PLDT
chairman Michael Pangilinan saying that Philcom owes the company
about PHP5 billion and that the debt is being considered in the
acquisition price.
The company told the PSE that it has a facilities management
agreement with Philippine Global Communications since 2003 to
help improve Philcom's operations.
About PLDT
Based in Makati City, Philippines, Philippine Long Distance
Telephone Co. -- http://www.pldt.com.ph/-- is the leading
national telecommunications service provider in the Philippines.
Through three principal business groups -- wireless, fixed line,
and information and communications technology -- the company
offers a wide range of telecommunications services to over 22
million subscribers in the Philippines across the nation's most
extensive fiber optic backbone and fixed line, cellular and
satellite networks.
* * *
The Troubled Company Reporter - Asia Pacific reported that on
November 3, 2006, Moody's Investors Service affirmed Philippine
Long Distance Telephone Company's Ba2 senior unsecured foreign
currency rating and changed its outlook to stable from negative.
At the same time, Moody's has affirmed PLDT's Baa3 domestic
currency issuer rating. The outlook for this rating remains
positive.
Standard & Poor's placed the company's long-term foreign issuer
credit rating at BB+. Standard & Poor's also affirmed its 'BB+'
foreign currency rating on the company with a stable outlook.
SAN MIGUEL: Employees' Pension Fund Brings Holdings to 15.76%
-------------------------------------------------------------
SMC Retirement Plan has acquired an additional 5.5% stake or
176.128 million shares in San Miguel Corp. from the Social
Security System, bringing its total holdings to 496.578 million
shares or 15.76% of SMC's outstanding shares, the Manila
Standard reports.
SMC Retirement Plan, a pension fund owned by SMC's employees,
bought the shares during a special block sales at the Philippine
Stock Exchange held last weekend. The fund now holds a
"substantial shareholder" status in SMC, in order to avoid a
hostile takeover by other major shareholders.
According to the article, DBP Daiwa Securities SMBC Philippines
Inc. and the First Resources Management and Securities Corp.
handled the transaction, a fact confirmed by Vivian Yuchengco,
head of First Resources, through a text message. However, she
declined to mention the other sellers and buyers.
Before the sale, SSS held a 5.6% stake in SMC, followed by Kirin
Brewery Co. Ltd. of Japan with a 20% holding in SMC. SM
Investment Corp., which is owned by business tycoon Henry Sy,
owns 10.8% of the company.
About San Miguel
Headquartered in Manila, Philippines, San Miguel Corporation --
http://www.sanmiguel.com.ph/-- through its subsidiaries,
operates food, beverage and packaging businesses. The company's
products include beer, wine and spirits, soft drinks, mineral
water, chicken and pork products. San Miguel markets its
products both in the domestic and overseas markets. The company
also manufactures glass, metal, plastic, paper and composites
packaging products.
A Troubled Company Reporter - Asia Pacific report on Oct. 12,
2006, stated that Moody's Investors Service affirmed its Ba1
corporate family rating.
Standard & Poor's Ratings Services gave San Miguel Corp. a 'BB'
foreign currency corporate credit rating and a 'B' rating to its
proposed five-year benchmark non-callable, non-cumulative, non-
voting, perpetual preferred shares to be issued by San Miguel
Capital Funding.
* Moody's Issues Annual Report on the Philippines
-------------------------------------------------
In its annual report on the Philippines, Moody's Investors
Service says its B1 foreign- and local-currency government bond
ratings reflect the country's relatively high sovereign debt
burden, which leaves government finances and the external
accounts vulnerable to shocks.
The B1 foreign-currency bond rating, and Moody's assessment of a
moderate risk of a payments moratorium in the event of a
government bond default, lie behind the Philippines' Ba3 foreign
currency country ceiling for bonds.
"Progress made in revenue reform and fiscal consolidation in
2006, and prospects for sustainable gains over the near term,
support a stable ratings outlook," said Moody's Vice President
Thomas Byrne, author of the report. "Debt management has
lengthened the average tenor and helped to narrow spreads, but
effective tax administration and prudent expenditure policies
are needed for the long-run stability of the country's
finances."
He pointed out that the Philippines' public-sector debt ratios
have receded from their historic peak, but remain relatively
high compared to the country's rating peers. The government's
revenue base cannot yet support higher spending to meet major
needs in public infrastructure, in part because of large
interest payments on debt.
Support to the balance of payments is provided by a flexible
exchange rate policy, a stable export production base in which
foreign firms play a large role, and sizable remittance inflows
from overseas workers, said the analyst.
"Foreign direct investment in the country has picked up, but
more progress in the privatization of the power sector would add
to inflows and also catalyze investment in other sectors," said
Byrne. "These factors have boosted official international
reserves to record levels."
He said overall weaknesses in the Philippines' investment
climate are reflected in lagging fixed capital formation which,
as a share of GDP, has declined to one of the lowest levels
among emerging market economies.
"Philippine economic policy has yet to translate its initial
successes in fiscal consolidation to improved underlying
performance in the economy," said Byrne.
Moody's report, "The Philippines: 2007 Credit Analysis," is a
yearly update to the markets and is not a rating action.
=================
S I N G A P O R E
=================
INTERPOOL: Commences Tender Offer for US$230MM of 6% Sr. Notes
--------------------------------------------------------------
Interpool, Inc. has commenced a tender offer for all of
US$230 million principal amount of its outstanding 6.0% Senior
Notes due 2014.
In connection with the tender offer, consents are being
solicited from noteholders to make certain proposed amendments
to the indenture governing the Notes.
Pursuant to the terms and subject to the conditions set in the
Offer to Purchase and Consent Solicitation Statement dated
June 13, 2007, the company is offering to purchase all of the
outstanding Notes at a price of US$1,015.00 per US$1,000
principal amount of the Notes. The Total Consideration includes
US$20.00 per US$1,000 principal amount of Notes payable only in
respect of Notes validly tendered with consents on or prior to
the Consent Date.
In addition, holders who validly tender and do not validly
withdraw their Notes in the tender offer will receive accrued
and unpaid interest from the last interest payment date up to,
but not including, the date of payment for the Notes, if the
Notes are accepted for purchase pursuant to the tender offer.
The tender offer is scheduled to expire at 8:00 a.m., New York
City time, on July 19, 2007, unless extended. Holders who
tender their Notes after 5:00 p.m., New York City time, on June
26, 2007, unless extended, will not be eligible to receive the
Consent Payment. Any holder validly tendering Notes after the
Consent Date will, if such Notes are accepted for purchase
pursuant to the tender offer, receive the Tender Offer
Consideration, plus accrued but unpaid interest to, but not
including, the date of payment for the Notes so tendered.
The proposed amendments to the indenture governing the Notes
would, among other things, eliminate substantially all of the
restrictive covenants, certain events of default and certain
other provisions contained in the indenture.
Completion of the tender offer is subject to the satisfaction of
certain conditions, including, but not limited to, receipt of
valid tenders and consents from a majority in principal amount
of outstanding Notes, receipt by Interpool of the funds
necessary to make all payments required to complete the tender
offer, including interest and other costs and expenses related
to the tender offer, and the satisfaction or waiver of all
conditions precedent to the consummation of the merger of
Interpool and Chariot Acquisition Sub, Inc., an indirect wholly
owned subsidiary of funds managed by affiliates of Fortress
Investment Group LLC, and the expectation that the Merger will
be consummated immediately following the Expiration Date.
Consummation of the tender offer is not a condition to the
Merger, and Chariot expects that its ability to finance the
transactions contemplated by the Merger and pay related
transaction fees and expenses will not be impaired if the tender
offer is not consummated.
The exclusive dealer manager and solicitation agent for the
tender offer is Bear, Stearns & Co. Inc.
About Interpool
Interpool, Inc. (NYSE: IPX) is a supplier of equipment and
services to the transportation industry. It is a lessor of
intermodal container chassis and a world-leading lessor of cargo
containers used in international trade. The company has
operations in Barbados, Basel and Singapore.
* * *
As reported in the Troubled Company Reporter on Apr. 26, 2007,
Interpool announced that it had entered into a definitive
agreement to be acquired by certain private equity funds managed
by affiliates of Fortress Investment Group LLC pursuant to a
merger in which all IPX stockholders would receive US$27.10 in
cash for each share of IPX common stock that they hold. The
total transaction value, including assumed debt, is
approximately US$2.4 billion.
Fitch placed the ratings of Interpool and its related
subsidiaries on Rating Watch Negative on Jan. 17, 2007. The
action reflected Fitch concerns regarding the underlying
financing structure of a proposed acquisition offer led by its
current chief executive officer, Marty Tuchman for US$24 per
share of common stock.
LEAR CORP: European Commission Clears US$5.3 Billion Icahn Deal
---------------------------------------------------------------
European Union regulators approved the purchase of Lear
Corporation by American Real Estate Partners, L.P., an
affiliate of Carl C. Icahn, for approximately US$2.8 billion,
the Associated Press relates.
According to the report, the European Commission did not
identify any antitrust problems that will result from the merger
nor received any complaints from rivals within the stated
deadline.
Under terms of the agreement, Lear shareholders would receive
US$36.00 per share in cash. The agreement also sees AREP
assuming about US$2.5 billion in debt. Closing is expected to
occur by the end of the second quarter of 2007.
Mr. Icahn holds a 16% stake in the company, which makes
him Lear's largest shareholder.
J.P. Morgan Securities Inc. served as a financial advisor to the
deal and Winston & Strawn, LLP served as legal counsel to a
Special Committee of Lear's Board of Directors. Bank of America
provided AREP with debt financing commitments for this
transaction.
The agreement is subject to the affirmative vote of the holders
of a majority of the outstanding shares of Lear common stock,
regulatory filings and approvals and other customary closing
conditions. Upon the closing of the transaction, shares of Lear
common stock will no longer be listed on the New York Stock
Exchange or publicly-traded.
About American Real Estate
Headquartered in New York City, American Real Estate Partners,
LP (NYSE:ACP) -- http://www.arep.com/-- a master limited
partnership, is a diversified holding company engaged in a
variety of businesses. The company's businesses currently
include gaming, oil and gas exploration and production, real
estate and home fashion. The company is in the process of
divesting its Oil and Gas operating unit and their Atlantic City
gaming property.
The company owns a 99% limited partnership interest in American
Real Estate Holdings Limited Partnership. Substantially all of
the assets and liabilities are owned by AREH and substantially
all of the company's operations are conducted through AREH and
its subsidiaries. American Property Investors, Inc., or API,
owns a 1% general partnership interest in both the company and
AREH, representing an aggregate 1.99% general partnership
interest in the company and AREH. API is owned and controlled
by Mr. Carl C. Icahn.
About Lear Corp.
Southfield, Mich.-based Lear Corp. (NYSE: LEA) --
http://www.lear.com/-- is a global supplier of automotive
interior systems and components. Lear provides complete seat
systems, electronic products, electrical distribution systems,
and other interior products.
Lear also operates in Argentina, Austria, Belgium, Brazil,
Canada, China, Czech Republic, United Kingdom, France, Germany,
Honduras, Hungary, India, Italy, Japan, Mexico, Morocco,
Netherlands, Philippines, Poland, Portugal, Romania, Russia,
Slovakia, South Africa, South Korea, Spain, Sweden, Thailand,
Tunisia, Turkey, Venezuela and Singapore.
* * *
In May 2007, Moody's Investors Service has assigned a B2
corporate family rating to AREP Car Acquisition Corp., the
corporate entity that will be established to affect the
consummation of the proposed acquisition and subsequent merger
of Lear Corporation into a subsidiary of American Real Estate
Partners, L.P.
At the same time, the rating agency confirmed Lear's existing
ratings consisting of:
-- a B2 corporate family rating;
-- B3 senior unsecured notes; and
-- B2 secured bank term loan.
The rating outlooks for, and revised Lear and Lear Newco's
outlook to, are stable from ratings under review for possible
downgrade.
As reported on Feb. 13, 2007, Standard & Poor's Ratings Services
lowered its corporate credit rating on Southfield, Mich.-based
Lear Corp. to 'B' from 'B+ and placed its ratings on CreditWatch
with negative implications following Lear's announcement that it
had agreed to be acquired by Carl Icahn-controlled American Real
Estate Partners, L.P.
LEE TUNG: Wind-Up Petition Hearing Set for July 9
-------------------------------------------------
A petition to wind up the operations of Lee Tung Company
(Private) Limited will be heard before the High Court of
Singapore on July 9, 2007, at 10:00 a.m.
The petition was filed by Chow Kwok Chi on April 27, 2007.
Chow Kwok's solicitor is:
Chow Kwok Chi
Drew & Napier LLC
20 Raffles Place, #17-00 Ocean Towers
Singapore 048620
NEWENT INVESTMENTS: Placed Under Voluntary Liquidation
------------------------------------------------------
At an extraordinary general meeting held on June 7, 2007, the
members of Newent Investments Pte Ltd agreed to voluntarily
liquidate the company's business and appointed Teh Kwang Hwee as
liquidator.
The Liquidator can be reached at:
Teh Kwang Hwee
c/o Tan & Teh
7 Maxwell Road
MND Complex Annexe B #05-07
Singapore 069111
PETROLEO BRASILEIRO: In Talks with Producers on Ethanol Price
-------------------------------------------------------------
Brazilian state-owned oil firm Petroleo Brasileiro SA Chief
Financial Officer Almire Barbassa told reporters that the
company is negotiating with producers to set a price range for
ethanol.
Mr. Barbassa said in a press conference in Rio de Janeiro,
"We're discussing fixing a maximum and minimum value for ethanol
prices. One of the most complex issues is establishing a price
that does not negatively affect buyers and sellers."
Mr. Barbassa told Business News Americas that Petroleo
Brasileiro's main goal is to guarantee that ethanol producers
will get a fair price. The firm also aims to ensure supply.
Petroleo Brasileiro said it is creating a seal of quality for
ethanol shipped from Brazil, BNamericas relates.
BNamericas notes that Petroleo Brasileiro wants to ensure
quality and make sure that suppliers comply with labor laws.
"Petrobras [Petroleo Brasileiro] is a socially aware company.
The ethanol we sell will come with a seal of quality," Mr.
Barbassa told BNamericas.
Headquartered in Rio de Janeiro, Brazil, Petroleo Brasileiro SA
aka Petrobras -- http://www2.petrobras.com.br/ingles/index.asp
-- was founded in 1953. The company explores, produces,
refines, transports, markets, distributes oil and natural gas
and power to various wholesale customers and retail distributors
in Brazil. Petrobras has operations in China, India, Japan, and
Singapore.
Petroleo Brasileiro SA's long-term corporate family rating is
rated Ba3 by Moody's.
Fitch Ratings assigned these ratings on Petroleo Brasileiro's
senior unsecured notes:
Maturity Date Amount Rate Ratings
------------- ------ ---- -------
April 1, 2008 US$400,000,000 9% BB+
July 2, 2013 US$750,000,000 9.125% BB+
Sept. 15, 2014 US$650,000,000 7.75% BB+
Dec. 10, 2018 US$750,000,000 8.375% BB+
Fitch upgraded the foreign currency rating of Petrobras to BB+
from BB, with positive outlook, in conjunction with Fitch's
upgrade of the long-term foreign and local currency IDRs of the
Federative Republic of Brazil to BB, from BB- on June 29, 2006.
PETROLEO BRASILEIRO: Mulls Hiring Regasification Vessel
-------------------------------------------------------
Brazilian state-run oil firm Petroleo Brasileiro SA Chief
Executive Officer Jose Sergio Gabrielli told reporters that the
company is considering hiring another liquefied natural gas
regasification vessel.
According to Business News Americas, Mr. Gabrielli said during a
speech in Brasilia that the vessel would add to two liquefied
natural gas storage and regasification vessels hired from UK
independent operator Golar LNG.
Mr. Gabrielli explained to BNamericas that the third vessel
would have regasification capacity of 14 million cubic meters
per day.
BNamericas relates that the first vessel will start operating in
the first half of 2008 in Ceara. The second vessel will operate
in 2009 in Rio de Janeiro.
Mr. Gabrielli didn't tell BNamericas where the third vessel
would be used.
Headquartered in Rio de Janeiro, Brazil, Petroleo Brasileiro SA
aka Petrobras -- http://www2.petrobras.com.br/ingles/index.asp
-- was founded in 1953. The company explores, produces,
refines, transports, markets, distributes oil and natural gas
and power to various wholesale customers and retail distributors
in Brazil. Petrobras has operations in China, India, Japan, and
Singapore.
Petroleo Brasileiro SA's long-term corporate family rating is
rated Ba3 by Moody's.
Fitch Ratings assigned these ratings on Petroleo Brasileiro's
senior unsecured notes:
Maturity Date Amount Rate Ratings
------------- ------ ---- -------
April 1, 2008 US$400,000,000 9% BB+
July 2, 2013 US$750,000,000 9.125% BB+
Sept. 15, 2014 US$650,000,000 7.75% BB+
Dec. 10, 2018 US$750,000,000 8.375% BB+
Fitch upgraded the foreign currency rating of Petrobras to BB+
from BB, with positive outlook, in conjunction with Fitch's
upgrade of the long-term foreign and local currency IDRs of the
Federative Republic of Brazil to BB, from BB- on June 29, 2006.
PETROLEO BRASILEIRO: Argentina Fines Firm for Fuel Insufficiency
----------------------------------------------------------------
Argentine reporters say that the Argentine government has fined
the local units of Royal Dutch Shell (RDSA) and Brazilian state
oil company Petroleo Brasileiro SA for allegedly failing to
sufficiently supply diesel fuel.
According to Dow Jones Newswires, government officials were
unable to confirm the news.
A Petroleo Brasileiro spokespeson told Dow Jones that he
couldn't immediately confirm the reports. Royal Dutch
representatives weren't immediately available.
Dow Jones notes that farm groups have been carping on diesel
shortages in recent weeks as "farmers wrap up record corn and
soy harvests and move to plant wheat."
Diesel shortage complaints have become chronic in recent years,
causing the government to threaten and fine firms. The
government sent Royal Dutch 23 fines of ARS1 million each in
December 2007 for allegedly failing to meet demand.
Headquartered in Rio de Janeiro, Brazil, Petroleo Brasileiro SA
aka Petrobras -- http://www2.petrobras.com.br/ingles/index.asp
-- was founded in 1953. The company explores, produces,
refines, transports, markets, distributes oil and natural gas
and power to various wholesale customers and retail distributors
in Brazil. Petrobras has operations in China, India, Japan, and
Singapore.
Petroleo Brasileiro SA's long-term corporate family rating is
rated Ba3 by Moody's.
Fitch Ratings assigned these ratings on Petroleo Brasileiro's
senior unsecured notes:
Maturity Date Amount Rate Ratings
------------- ------ ---- -------
April 1, 2008 US$400,000,000 9% BB+
July 2, 2013 US$750,000,000 9.125% BB+
Sept. 15, 2014 US$650,000,000 7.75% BB+
Dec. 10, 2018 US$750,000,000 8.375% BB+
Fitch upgraded the foreign currency rating of Petrobras to BB+
from BB, with positive outlook, in conjunction with Fitch's
upgrade of the long-term foreign and local currency IDRs of the
Federative Republic of Brazil to BB, from BB- on June 29, 2006.
STATS CHIPPAC: Moody's Lifts Rating to Ba1 on Good Performance
--------------------------------------------------------------
Moody's Investors Service upgraded STATS ChipPAC's corporate
family rating and foreign currency debt ratings to Ba1 from Ba2.
This concludes the review for possible upgrade which began on
March 1, 2007. The outlook for all the ratings is stable.
"The rating upgrade reflects STATS ChipPAC's improved operating
and financial profiles with continued free cash flow generation
on the back of favorable industry fundamentals," says Wonnie
Chu, lead analyst for STAT ChipPAC, adding "the company
maintains its strong market position with a more diversified
customer base."
At the same time, the support level for STAT ChipPAC from its
parent, Singapore Technologies Semiconductors Pte Ltd which is
in turn 100%-owned subsidiary of Temasek, has also been changed
to Medium from Low under Moody's joint default analysis for
government related issuer.
This follows the completion of the voluntary conditional cash
offered by STS to buy the remaining shares and convertible
subordinated notes due in 2008 of STATS ChipPAC. STS now owns
83.1% of STATS ChipPAC and US$134.5m of its convertible
subordinated notes.
The Ba1 rating take into account:
(1) STATS ChipPAC's stand-alone credit fundamental, and
(2) the likelihood of Temasek (rated Aaa/Stable), through
STS, providing the company with credit support in a
stress situation.
Moody's ranks the company's underlying credit fundamental as
"11-13" equivalent to Ba1-Ba3 on our global rating scale. This
assessment reflects STATS ChipPAC's strong market position as
the fourth largest player in the OSAT industry, its positive
free cash flow generative status and sound debt maturity
profile.
At the same time, it also takes into account STATS ChipPAC's
continued exposure to average sales price erosion and price
fluctuations for raw materials, which are a major cost in the
assembly process.
Moody's overlays the company's stand-alone credit fundamental on
a joint default analysis approach. That involves estimating the
likelihood that in the event of pending failure by the company,
Temasek - through STS - would step in and prevent a default.
The medium support reflects STATS ChipPAC's importance within
Temasek, which through STS, owns 83.1% of STATS ChipPAC's issued
shares.
The ratings could experience upward pressure if:
(1) a track record emerges of maintaining profitability and
achieving projected results over the semiconductor cycle;
(2) an ability to generate free cash flow for permanent debt
reduction emerges, such that total debt/total cap < 25%
and (EBITDA-Capex)/Int > 4.5-5.0x on a sustained basis;
and
(3) cash holdings are built up and strong balance sheet
liquidity is maintained to provide a buffer against
industry cyclicality.
In addition, evidence of financial support from Temasek would be
positive for the rating as it would improve the support level.
On the other hand, downward ratings pressure could evolve if:
(1) asset utilization falls, reducing profitability and cash
flow-generating abilities;
(2) an industry downturn emerges, and which materially
impairs the company's debt-servicing ability; or
(3) its balance sheet gears up due to a large capital
expenditure or investment program, such that total
debt/total cap > 40% and (EBITDA-Capex)/Int < 1.5-2.0x
over the cycle.
Furthermore, a significant reduction in STS's controlling stake
which weakens the support level, a scenario is considered
unlikely in the near term, would be negative for the rating.
STATS ChipPAC Ltd is a back-end semiconductor assembly and test
company. It provides full-turnkey solutions to semiconductor
businesses, including foundries, integrated device manufacturers
and fabless companies in the U.S., Europe and Asia. It ranked
fourth in the global outsourcing semiconductor assembly and test
industry as of end-2006. In fiscal year 2006, packaging revenue
accounted for 74% of sales, and test and other revenues the
balance. The communications segment accounted for 57% of sales.
The company's offices outside the United States are located in
Singapore, South Korea, China, Malaysia, Taiwan, Japan, the
Netherlands and United Kingdom.
SYSTOME THERAPEUTICS: Accepting Proofs of Debt Until July 16
------------------------------------------------------------
Systome Therapeutics Pte. Ltd., which is in liquidation,
requires its creditors to file their proofs of debt by July 16,
2007.
Failure to prove debts by the due date will exclude a creditor
from sharing in the company's dividend distribution.
The company's liquidators are:
Kon Yin Tong
Wong Kian Kok
Aw Eng Hai
c/o 47 Hill Street #05-01
Singapore Chinese Chamber of Commerce
& Industry Building
Singapore 179365
===============
T H A I L A N D
===============
ASIA HOTEL: Postpones Extraordinary General Shareholders Meeting
----------------------------------------------------------------
Asia Hotel PCL's board of directors, during a meeting on
June 12, has agreed to postpone the company's extraordinary
shareholders' general meeting for the approval of the renewal of
a contract between its subsidiary, Zeer Property Co. Ltd., and
Don Muang Grand Plaza Co. Ltd.
The contract covers land and structure leased by Don Muang to
Zeer Property. The meeting will also approve a separate contract
for leasing additional land between Zeer Property and Don Muang
through the transfer of land owned by Asia Airport Hotel Co.
Ltd. to Don Muang. Since information on the transaction has not
yet been completed, the Board of Directors decided to postpone
the meeting until the information has been furnished.
Headquartered in Bangkok, Thailand, Asia Hotel Public Company
Limited -- http://www.asiahotel.co.th/-- was incorporated on
March 24, 1964, and has been publicly listed since 1989. The
company and its two subsidiaries, Asia Pattaya Hotel Company
Limited and Asia Airport Hotel Company Limited, are involved in
the hotel business, with its principal activities consisting of
room service and operating restaurants. Another subsidiary,
Zeer Property Company Limited is primarily involved in the
construction and the building of shopping complexes.
After auditing Asia Hotel PCL's consolidated financial
statements for the three months ended March 31, 2007, Mr.
Atipong Atipongsakul at ANS Audit Co. Ltd. raised doubt about
the company's ability to continue as a going concern after
finding a shareholder deficit of THB986 million in the company's
balance sheets.
BANK OF AYUDHYA: Warrants Exercise Date Set for June 29
-------------------------------------------------------
The date for exercising warrants issued by Bank of Ayudhya PCL
to institutional investors and shareholders will be on June 29,
2007.
Warrants to be exercised are those that the Bank allocated to
institutional investors and special investors who subscribed for
commmon shares of the bank at August 19-22, 2003 and to
shareholders of record as of August 28, 2003.
Warrant holders are required to make a notification of their
intent to exercise from June 22 until June 28, 2007, with intent
forms available at any of the bank's branches nationwide, or at
its head office located at 1222 Rama III Road, Bang Phongphang
Subdistrict, Yan Nawa District, Bangkok. Contact numbers for the
main office are 0-2296-4442, 0-2296-4453, 0-2296-4454. Holders
are also required to prepare and submit these documents and
evidence to the bank:
* Accomplished intent form
* Certificates or the substitution forms of warrant to be
converted
* Payment as per the conversion amount made either in cash,
cheque, draft or money order. Cheques dated on the
submission day must be crossed and made payable to "Bank
of Ayudhya PCL for share subscription." Cheques must also
be within the same clearing area and the conversion will
be completed only when the Bank receives such payment.
Warrant holders who intend to buy ordinary shares may notify the
bank of their intent by submitting a complete request form for
issuance of warrant certificates or the substitution form to
their brokers. It is the broker's responsibility to notify the
Thailand Securities Depository Co. Ltd. and request for issuance
of warrant certificates, or permission to use the substitution
form as evidence for rights exercise to buy ordinary shares in
the bank.
The bank will not issue ordinary shares to foreign individuals
or entities if it constitutes a violation of its articles of
association on foreign shareholding limits.
About Bank of Ayudhya
Headquartered in Bangkok, Thailand, Bank of Ayudhya Public Co.
Ltd. -- http://www.krungsri.com/-- provides a full range of
banking and financial services. The bank offers corporate and
personal lending, retail and wholesale banking; international
trade financing asset management; and investment banking
services to customers through its branches. It has branches in
Hong Kong, Vietnam, Laos, and the Cayman Islands.
* * *
On May 4, 2007, Moody's Investor Services affirmed its D- bank
financial strength rating for Bank of Ayudhya. The Foreign
Currency Deposit Ratings are unchanged at Baa3/P-3. The outlook
for all ratings is stable.
The Bank carries Standard and Poor's Rating Services' BBB-/A-3
Credit Rating with a stable outlook.
The Troubled Company Reporter - Asia Pacific reported on June 7,
2007 that Fitch Ratings has affirmed Bank of Ayudhya Public
Company Limited's (BAY) Foreign Currency Issuer Default Rating
at 'BBB-' (BBB minus) with Stable Outlook, Short-term Foreign
Currency rating at 'F3', Individual rating at 'C/D', Support
rating at '3' and its subordinated debt rating at 'BB+'.
The bank's Support Rating Floor remains unchanged at 'BB'.
Meanwhile, Fitch Ratings (Thailand) has also affirmed BAY's
National Long-term Rating at 'A+(tha)' with Stable Outlook, its
National Short-term Rating at 'F1(tha)' and its National
subordinated debt rating at 'A(tha)'.
COMPASS EAST: Turns Around w/ THB277,394 Net Income for 1st Qtr.
----------------------------------------------------------------
Compass East Industry (Thailand) PCL and its subsidiaries posted
a consolidated net income of THB277,394 for the three months
ended April 30, 2007, a turn-around from the previous loss of
THB97.44 million reported for the same period in 2006.
For the quarter ended April 30, 2007, the group earned sales of
THB50.74 million and THB14.34 million in other income from
operations, while incurring cost of sales of THB61 million,
selling and administrative expenses of THB20.24 million and
interest expenses of THB136,692. The group also recorded
THB18.9 million in reversal of allowances for diminutions in
value of inventories, and a THB2.32 million loss from sales
equipment and mould.
As of April 30, 2007, the group had total assets of
THB802.93 million and total liabilities of THB118.36 million,
resulting in a total shareholders' equity of THB684.57 million.
Thailand-based Compass East Industry (Thailand) Public Company
Limited -- http://www.ceifan.com/-- is a manufacturing company
primarily engaged in the production and distribution of ceiling
fans under the brand names Sunlight and Aire Royale. Its
operation activities include original equipment manufacture
(OEM) and original design manufacture (ODM). The company
distributes its products in both domestic and overseas markets.
Headquartered in Bangkok, Compass East Industry (Thailand)
operates a production site in Samutprakan Province with a full
production capacity of 1 million units per annum. The company
has two subsidiaries, Air Royal Industries Company Limited and
Air Breeze Company Limited in China.
Going Concern Doubt
Susan Eiamvanicha at SP Audit Company Limited, the company's
independent auditors, raised significant doubt on the company's
ability to continue as a going concern, saying that as of
January 31, 2007, the group and company incurred accumulated
losses of THB29.87 million and THB34.62 million, respectively.
She adds that the company's ability to continue as a going
concern will be dependent on ability in the profit making of the
company in the future.
DAIMLERCHRYSLER AG: Elects to Redeem Term Assets of Trust
---------------------------------------------------------
DaimlerChrysler AG has elected to redeem the term assets of the
trust on June 29, 2007, at a redemption price equal to par plus
a make-whole amount to be determined two business days prior to
the Redemption Date.
The company has notified the U.S. Bank Trust National
Association, as Trustee, under the Base Trust Agreement dated as
of May 21, 1998, as supplemented by the Series C 1998-6
Supplement dated as of May 21, 1998, between Structured Products
Corp. and the Trustee.
If the Trustee receives the redemption payment on the Redemption
Date, then the Amortizing Certificates issued by the TIERS
Corporate Bond-Backed Certificates Trust C 1998-6 will be
redeemed in full on the Redemption Date at a price equal to
55.49314% of the redemption payment received by the Trustee and
the ZTF Certificates issued by the Trust will be redeemed in
full on the Redemption Date at a price equal to 44.50686% of the
redemption payment received by the Trustee. If the Amortizing
Certificates are redeemed in full on the Redemption Date, no
interest will accrue on the Amortizing Certificates after the
Redemption Date. If the Trustee does not receive the redemption
payment, the certificates will not be redeemed.
For more information about these redemptions, please contact
Janet O'Hara of U.S. Bank Trust National Association at 212-361-
2527.
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: Chrysler to Invest US$450MM in Kenosha Plant
-------------------------------------------------------------
Chrysler Group disclosed plans to invest US$450 million in its
Kenosha Engine Plant in Wisconsin for a comprehensive retooling
in preparation for the launch of a new family of fuel-efficient
V-6 engines. The investment and retooling are part of an
extensive powertrain offensive that will commit a total of US$3
billion to develop and launch the new engines -- known as
Phoenix engines -- in addition to a dual-clutch transmission
joint venture with German parts maker Getrag and new common axle
family. All are part of Chrysler Group's commitment to advanced
powertrain technologies and the first step to more fuel-
efficient vehicles.
Scheduled to begin production in January 2011, the plant will
have an annual Phoenix production capacity of 400,000 units when
it reaches full volume.
The event, held at the 1.9 million square-foot plant, marks
another significant milestone in the progress of the Chrysler
Group's Recovery and Transformation Plan. Wisconsin Gov. Jim
Doyle; Kenosha Mayor John Antaramian; Richard Chow-Wah, Vice
President - Powertrain Manufacturing, Chrysler Group; Kenosha
Engine Plant Manager Kevin Sell; and UAW officials participated
in the news event.
"This retooling investment will allow us to build an entirely
new, globally competitive family of V-6 engines," Mr. Chow-Wah
said. "The Chrysler Group Recovery and Transformation Plan is
focused on new products, and the news supports a long-term
commitment to new vehicle components that support consumer
demand for refined, economical-to-operate vehicles for many
years to come."
"Chrysler Group has had a 20-year-long presence in Kenosha and
even longer factoring in American Motors' storied past," Mr.
Sell said. "With this new tooling and this new engine line,
we're demonstrating the commitment of Chrysler Group to support
economic development and invest in the communities where it does
business.
Retooling for the Kenosha Phoenix Engine Plant will begin in
June 2010.
"Wisconsin is one of America's leading manufacturing economies.
This US$450 million commitment by Chrysler to our state
demonstrates that we continue to attract important investments
that provide high paying jobs for our workforce," Wisconsin Gov.
Jim Doyle said. "This shows what can happen when state and local
governments work together to create a business-friendly
environment."
The Governor said that Chrysler Group would receive an incentive
package of Kenosha County, City of Kenosha and State of
Wisconsin funds totaling US$16.8 million. Once the plant is
fully operational, Kenosha Phoenix Engine Plant will employ 700
full-time workers.
"This is an important day for the future of the UAW and Chrysler
Group, and in particular for the continued competitiveness of
our team here in the State of Wisconsin," General Holiefield,
UAW Vice President, who directs the union's DaimlerChrysler
Department, said. "We have a vision to see this company and our
union grow this business and transform Chrysler Group into a
stronger company that will be competitive for the long run. The
investment we announce today proves that we are investing in
this vision."
Chrysler Group has had a presence in Kenosha since 1987, when
American Motors Corp. was acquired by Chrysler Corporation. The
company's current 2.7-liter V-6 has been produced there since
1997. The company's 3.5-liter V-6 was launched in 1999, part of
a US$624 million modernization of the plant. The plant was built
in 1917. Over the long term, the Phoenix family of V-6 engines
will reduce manufacturing complexity by paring the company's
four current V-6 engine architectures to one. Kenosha becomes
the third Phoenix engine plant announced by Chrysler Group since
April 2007, joining previously announced plants in Trenton,
Michigan and Saltillo, Mexico. The company will also construct
an all-new plant in Marysville, Michigan to build a new line of
corporate axles.
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: Joins GM & Ford in Healthcare Fund, Sources Say
----------------------------------------------------------------
DaimlerChrysler AG's Chrysler Group, General Motors Corp. and
Ford Motor Company are in talks to create an independent health-
insurance fund to trim their combined US$114 billion in future
retiree healthcare obligations, Bloomberg News reports, quoting
five people with direct knowledge of the talks as saying.
According to the report, the U.S. automakers would each
contribute to the fund to pay for healthcare benefits of United
Auto Workers retirees, the sources said, requesting anonymity
because the negotiations are private. The talks are preliminary
so the fund's size and how much each company would contribute
haven't been determined, they said.
The car companies are trying to deal with healthcare costs that
GM CEO Rick Wagoner says cost them a combined US$12 billion in
2006. Providing health care to 2 million employees, retirees and
dependents contributed to losses at each of the U.S. automakers
last year, while Japanese rivals posted record profits,
Bloomberg reveals.
Under the proposal, the companies would contribute a percentage
of their retiree liabilities to the fund, whose assets and
investment proceeds would cover retiree medical benefits,
Bloomberg relates.
The idea is modeled after the Goodyear Tire & Rubber Co.
healthcare plan, the people said. The Akron, Ohio-based
tiremaker, with a healthcare liability of US$1.3 billion for
United Steelworkers of America retirees, agreed in December to
set up a healthcare trust fund with a one-time US$1 billion
payment in cash and stock, after which, Goodyear will have no
further healthcare obligation to current or future union
retirees. The accord came after an 85-day strike, Bloomberg
states.
The joint fund is one of several ideas for cutting labor costs
being weighed by U.S. automakers as they prepare for next
month's contract negotiations with the United Auto Workers, the
sources said. GM, Ford and Chrysler haven't decided whether to
offer the proposal during the talks, which will replace the
current four-year contract expiring in September 2007, Bloomberg
quotes three of the sources as saying. The companies are
exploring a single provider to reduce administration costs and
overlapping services, they said.
The union is aware of the discussions and is willing to consider
the idea, one of the people familiar with the matter said,
Bloomberg notes. GM, Ford and the UAW last year agreed to a
court settlement requiring union retirees to pay part of their
healthcare costs for the first time. Detroit-based GM and Ford,
of Dearborn, Michigan, also pledged not to alter those retiree
healthcare benefits until after 2011 without union consent.
Last year's settlement, as well as benefit reductions for
salaried workers, helped GM cut retiree healthcare liabilities
by 21% to US$64 billion at the end of last year, Bloomberg
discloses. Ford had retiree obligations of US$31 billion, and
Chrysler's potential future tab is about US$19 billion. GM has
already bought out 34,400 union workers, and Ford and Chrysler
together are trying to persuade 50,000 to leave as they cut
production to match market-share losses to Toyota Motor Corp.
and Honda Motor Co.
GM had about 357,000 union retirees in the U.S. at the end of
last year, Bloomberg says. Ford reported 570,000 active union
and non-union employees, retirees and dependents.
About General Motors Corp.
General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- is the
world's largest automaker and has been the global industry sales
leader for 76 years. GM currently employs about 280,000 people
around the world. GM manufactures its cars and trucks in 33
countries. General Motors has Asia-Pacific operations in India,
China, Indonesia, Japan, the Philippines, among others. It has
locations in European countries including Belgium, Austria, and
France. In Latin-America, the company maintains locations in
Argentina, Brazil, Chile, Colombia, Ecuador, Venezuela, Paraguay
and Uruguay.
About Ford Motor Co.
Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) --
http://www.ford.com/-- manufactures or distributes automobiles
in 200 markets across six continents. With about 260,000
employees and about 100 plants worldwide, the company's core and
affiliated automotive brands include Ford, Jaguar, Land Rover,
Lincoln, Mercury, Volvo, Aston Martin, and Mazda. The company
provides financial services through Ford Motor Credit Company.
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.
* 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 ***