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 Thursday, March 27, 2008, Vol. 11, No. 61 Headlines A U S T R A L I A A G S PLUMBING: Placed Under Voluntary Liquidation ADMAR INTERNATIONAL: Members Opt to Liquidate Business AINSWORTH GAME: Incurs AU$10.8 Million for 2007 First Six Mos. AINSWORTH GAME: Sees Positive Financial Recovery for Midterm ALLCO FINANCE: IMF Australia to Finance Shareholders' Litigation BASIS CAPITAL: BYAF Will Not Claim Application Monies CENTRO PROPERTIES: IMF Australia to Finance Litigation EVERNEW FASHIONS: Placed Under Voluntary Liquidation FOSADA PTY: Members to Receive Wind-Up Report on April 8 GEORGE BOARD: Members Opt to Liquidate Business JAMES MACKENZIE: Members Resolve to Liquidate Business JPMORGAN: Moody's Junks Rating on Mobius ELR-01 Class C Notes NEURAGENIX PTY: Members & Creditors Meeting Set for April 2 SIX WHEELER: Members Agree on Voluntary Liquidation SLIM FRUIT: Placed Under Voluntary Liquidation W & M KLEIN: To Declare First Dividend on May 5 C H I N A & H O N G K O N G & T A I W A N BANK OF COMMUNICATION: Seeks to Raise CNY5 Bil. by Selling Bonds COMEGLORY TRADING: Court to Hear Wind-Up Proceedings on April 16 DOUBLE KEEN: Court to Hear Wind-Up Proceedings on April 30 GENTLEMAN GIVENCHY: Members Meeting Fixed for April 15 ICBC: Inks US$1-Billion Resource Fund Deal with Standard Bank KINGTEC SYSTEMS: Court to Hear Wind-Up Proceedings on April 23 METALSOLV SOFTWARE: Commences Liquidation Proceedings PETROLEOS DE VENEZUELA: To Ask Exxon Compensation for Damages PIONEER NATIONAL: Commences Liquidation Proceedings SHENZHEN DEV'T: Sells CNY6.5 Billion of 10-year Bonds SPL WORLDGROUP: Commences Liquidation Proceedings UNIVERSAL ALUMINUM: Wind-Up Hearing Set for April 16 WAI TAT: Court to Hear Wind-Up Proceedings on April 16 WINNING SUCCESS: Appoints New Liquidators I N D I A ICICI BANK: To Invest INR11.5 Billion in Jaypee Infratech GENERAL MOTORS: Extended Strike Spurs S&P's Negative CreditWatch QUEBECOR WORLD: Has US$350 Million in Available Funds QUEBECOR WORLD: Noteholders Question Panel Advisors' Engagement TATA MOTORS: To Buy Jaguar and Land Rover for US$2.3 Billion I N D O N E S I A BANK INTERNASIONAL: Receives Maybank's US$2.7-Billion Offer BANK MEGA: Projects 40.7% Increase in Net Profit PERUSHAAN LISTRIK: To Provide Free Power Connection in Sulawesi PERUSAHAAN NEGARA: Fitch Affirms BB- Ratings with Pos. Outlook SEMEN GRESIK: 2007 Net Profit Up 37% to IDR1.78 Trillion TELKOM: Alcatel-Lucent to Deploy Data Recovery Service Network J A P A N AMR CORP: S&P Revises Outlook to Negative on Expected Loss JAPAN AIRLINES: Studies Safety Measures Along With Trade Unions SAPPORO HOLDINGS: Counts on Shareholders to Retain Measures * Fitch Says FIEA Restrictions on Real Estate Won't Affect CMBS K O R E A ILSUNG CONSTRUCTION: Appoints Won Hyeon Su as CEO KENERTEC CO: Signs KRW2.15BB Contract With Korea-Based Apartment KOREA HINET: Jung Jae Hun & Individual Sell Company Stakes M A L A Y S I A HARVEST COURT: Bursa Approves Listing of New Warrants & Shares MALAYSIAN AIRLINE: Served with Complaint from Bruce Hut PANGLOBAL: SC Approves Sept. 25 Deadline to Execute Reform Plan SHAW GROUP: Wins Shandong Electric Nuclear Power Plant Contract SOLUTIA INC: Files Amended Financial Report for Year 2007 SOLUTIA INC: To Begin Financial Reporting on Five Segments SOLUTIA INC: Appoints Nine Members to Board Committees SOLUTIA INC: To Rely on Asian Growth Amid Slowing U.S. Economy N E W Z E A L A N D BARRYS CAR: Taps Price & Horton as Liquidators BRONWYN ESTATE: Fixes April 10 as Last Day to File Claims FABB HOLDINGS: Fixes April 4 as Last Day to File Claims FORRESTER BOOKS: Fixes April 11 as Last Day to File Claims FRESH EXPRESS: Appoints Cain & Hollis as Liquidators IL VILLAGGIO: Requires Creditors to File Claims by March 31 TAURANGA SANDBLASTING: Placed Under Voluntary Liquidation TENNYSON BM: Commences Liquidation Proceedings WEIGHT WATCHERS: S&P Changes Outlook to Stable on Debt Repayment WORXFINISHED LTD: Creditors' Proofs of Debt Due on March 31 P H I L I P P I N E S ALLIED BANKING: Moody's Releases First Banking Sector Report BANCO DE ORO: Moody's Releases First Banking Sector Report BANK OF THE PHIL: Moody's Releases First Banking Sector Report DEV'T BANK: Moody's Releases First Banking Sector Report LAND BANK: Moody's Releases First Banking Sector Report METROPOLITAN BANK: Moody's Releases First Banking Sector Report PHIL. NATIONAL: Moody's Releases First Banking Sector Report RIZAL COMMERIAL: Moody's Releases First Banking Sector Report UNITED COCONUT: Moody's Releases First Banking Sector Report * Moody's Releases First Philippine Banking Sector Overview S I N G A P O R E LEAR: Extended Work Stoppage Cues S&P's Negative CreditWatch - - - - - ================= A U S T R A L I A ================= A G S PLUMBING: Placed Under Voluntary Liquidation -------------------------------------------------- A G S Plumbing Service Pty. Ltd.'s members agreed on Feb. 21, 2008, to voluntarily liquidate the company's business. In line with this goal, the company has appointed Richard Herbert Judson to facilitate the sale of its assets. The liquidator can be reached at: Richard Herbert Judson Members Voluntarys Pty. Ltd. P.O. Box 819, Moorabbin Victoria 3189 Australia About A G S Plumbing A G S Plumbing Service Pty. Ltd. is a special trade contractor. The company is located at Hornsby, in New South Wales, Australia. ADMAR INTERNATIONAL: Members Opt to Liquidate Business ------------------------------------------------------ Admar International Pty. Ltd.'s members agreed on February 14, 2008, to voluntarily liquidate the company's business. In line with this goal, the company has appointed Daniel Bryant and Craig Crosbie to facilitate the sale of its assets. The liquidators can be reached at: Daniel Bryant Craig Crosbie PPB, Chartered Accountants 90 Collins Street, Level 10 Melbourne, Victoria 3000 Australia About Admar International Admar International Pty. Ltd., which is also trading as Craig Plumbing Contractors, is involved with plumbing, heating, and air-conditioning services. The company is located at Mitcham, in Victoria, Australia. AINSWORTH GAME: Incurs AU$10.8 Million for 2007 First Six Mos. ---------------------------------------------------------------- Ainsworth Game Technology Ltd. posted a consolidated net loss of AU$10.8 million as compared to the previous year's AU$17.7 million for the six-months ended December 31, 2007. Sales improved to AU$21.7 million, a 4.8% increase year-on-year. As of February 19, 2008, the company's balance sheet has AU$53.7 million in total current assets available to pay AU$11.1 million total current liabilities coming due within the next 12 months. Total assets AU$90.4 million versus total liabilities AU$58.1 million, resulting in total shareholders' equity or of AU$32.3 million. About Ainsworth Game Ainsworth Game Technology Limited designs, develops and sells gaming machines and other related equipment and services. The Company's products are ambassador gaming machine and celebrity gaming machine. AGT has products in casinos across Australia. AGT operates in Russia, Austria, France and Germany. Its wholly owned subsidiaries are AGT Pty Ltd, Ainsworth Game Technology Inc (USA), Ainsworth Game Technology (UK) Ltd, Ainsworth International GmbH, Ainsworth Game Technology (NZ) Limited and AGT Service Pty Ltd. The Troubled Company Reporter - Asia Pacific, on November 23, 2007, that Ainsworth Game Technology Limited incurred a net loss of AU$49.49 million for the year ended June 30, 2007. KPMG raised material uncertainty on the company's and group's ability to continue as a going concern, saying that the company needs the continued support of its major shareholder and its ability to achieve sustainable profitable operations and generate positive net cash inflows in the future. AINSWORTH GAME: Sees Positive Financial Recovery for Midterm ------------------------------------------------------------ Ainsworth Game Technology Ltd. said it was confident of a financial turnaround in the medium term after booking a reduced first half loss, reports the Australian Associated Press. According to AAP, Ainsworth was hurt by licensing bottlenecks and product performance issues. However, it said that it was confident that a recent broadening of its product range would deliver increased revenue in the short term. Len Ainsworth, Executive Chairman of Ainsworth, is quoted as saying, "I am confident in the progress to date and the ability of the company to affect a financial turnaround in the medium term," relates AAP. About Ainsworth Game Ainsworth Game Technology Limited designs, develops and sells gaming machines and other related equipment and services. The Company's products are ambassador gaming machine and celebrity gaming machine. AGT has products in casinos across Australia. AGT operates in Russia, Austria, France and Germany. Its wholly owned subsidiaries are AGT Pty Ltd, Ainsworth Game Technology Inc (USA), Ainsworth Game Technology (UK) Ltd, Ainsworth International GmbH, Ainsworth Game Technology (NZ) Limited and AGT Service Pty Ltd. The Troubled Company Reporter - Asia Pacific, on November 23, 2007, that Ainsworth Game Technology Limited incurred a net loss of AU$49.49 million for the year ended June 30, 2007. KPMG raised material uncertainty on the company's and group's ability to continue as a going concern, saying that the company needs the continued support of its major shareholder and its ability to achieve sustainable profitable operations and generate positive net cash inflows in the future. ALLCO FINANCE: IMF Australia to Finance Shareholders' Litigation ---------------------------------------------------------------- IMF Australia Ltd. will finance legal action against, among others, Allco Finance Group Ltd. for losses to shareholders, reports Laura Cochrane of Bloomberg News. According to the report, shareholders allege that Allco, along with Centro Properties Group and MFS Ltd. failed to disclose debt obligations between August 2007 to February this year. IMF, in a statement with the Australian Securities Exchange, said that it will fund legal action for those shareholders who bought stock in Allco from August 21 to February 25, relates Bloomberg. Bloomberg added that Allco is negotiating with banks on AU$250 million of loans due May 1 and lenders are reviewing its ability to repay a further AU$900 million of debt. Tim Allerton, a spokesman for Allco, said the company is "happy with the level of disclosure over recent months," writes Ms. Cochrane in a separate report. John Walker, managing director of IMF, in an interview opined that the cases could represent "potentially thousands" of shareholders and will each require as much as AU$10 million in funding. Legal action would further threaten the survival of the company as they struggle to repay debt and renegotiate funding in credit markets that are shunning leveraged firms, states Bloomberg. About Allco Finance Allco Finance Group Ltd. is an integrated global financial services business, specializing in asset origination, funds creation and funds management. The Company is a fund manager of alternative assets in its core asset classes, which include aviation, rail, shipping, infrastructure, property, private equity and financial assets. Its primary focus is on commercial property, predominately completed office buildings and select development opportunities. It also purchases new and existing commercial passenger and cargo aircraft for lease to commercial airlines. In March 2007, Allco HIT Limited acquired Momentum Investment Finance Pty Limited, Allco Financial Services and International Mezzanine Funds Management (Australia) Limited. The Company is a vendor of Momentum Investment Finance Pty Limited and Allco Financial Services. In July 2007, it acquired Allco Equity Partners Ltd. In December 2007, it completed the acquisition of the remaining 79.6% stake of Rubicon Holdings (Aust) Limited. Published reports said that Allco is in the brink of insolvency and is currently negotiating a new business plan that will avoid puttings its operations in the hands of administrators. According to The Age, Allco board is faced with four problems: -- Meeting a fast-approaching deadline to refinance at least US$250 million in debt. -- Ensuring there is enough cash to cover its continuing, and much larger, loan commitments. -- Renegotiating or pulling out of a recently announced joint venture deal to buy US$1.7 billion of US power stations, of which Allco would fund half by debt and equity. -- Signing the company's accounts, for which they will be personally liable, that would allow the suspension on Allco's beleaguered shares to be lifted. BASIS CAPITAL: BYAF Will Not Claim Application Monies ----------------------------------------------------- Basis Yield Alpha Master Fund has decided not to make a claim on monies held by Basis Capital Funds Management Ltd, reports Susannah Moran of The Australian. BYAF (M) is managed by Basis Capital. Ms. Moran writes that investors in BYAF (M) are waiting to see how much of their AU$320 million investment will be returned. BYAF (M), which invested heavily in collaterized debt obligation and was caught up in the subprime mortgage fallout in the US, was frozen in July 2007 and applications and redemptions suspended after heavy losses, relates The Australian. According to the report, Basis Capital applied to the New South Wales Supreme Court seeking declarations that it had complied with the Corporations Act when it retained application funds received in June last year. Also, Basis Capital wants a declaration that anyone who applied to have their money taken out in the June quarter be ranked as creditors of the fund. Paul Billingham from Grant Thornton, BYAF (M)'s joint liquidator, wrote to Basis Capital saying, "The joint official liquidators of the BYAF(M) advise that we do not seek to intervene in the proceedings. To clarify, BYAF(M) will not be making any claim in respect of the application monies against the parties to the proceedings and, without reservation, will not seek to intervene in the proceedings." About Basis Capital Basis Capital Funds Management Ltd. manages and advises multi strategy, relative value and arbitrage funds for Australian domestic and international investors. The Troubled Company Reporter-Asia Pacific reported on July 30, 2007, that the Basis Field Fund and Basis Aust-Rim Fund ran into trouble by investing in the unrated, riskiest portions of collaterized debt obligations. These portions also known by bankers as "toxic waste" are first in line for any losses when borrowers fall short on mortgage payments and have hired Blackstone Group LP as an adviser to help avoid a fire of sale of assets. Blackstone will advise the hedge fund firm "to prevent adverse pricing and selling of assets." CENTRO PROPERTIES: IMF Australia to Finance Litigation ------------------------------------------------------ IMF Australia Ltd. will finance legal action against Centro Properties Group for losses to shareholders, reports Laura Cochrane of Bloomberg News. According to the report, Centro shareholders allege that Centro failed to disclose debt obligations between August 2007 to February this year. IMF, in a statement with the Australian Securities Exchange, said that it will fund legal action for those shareholders who bought stock in Centro and its listed real estate investment trust Centro Retail from August 9 to February 15, relates Bloomberg. Bloomberg added that Centro faces an April 30 deadline on its AU$4.9 billion debt. Lauren Thompson, a spokeswoman for Centro, said the company doesn't comment on any legal matters and was not aware of any claims, writes Ms. Cochrane in a separate report. IMF, according to the report, said claims against Centro would be conducted by law firm Maurice Blackburn Ltd. John Walker, managing director of IMF, in an interview opined that the cases could represent "potentially thousands" of shareholders and will each require as much as AU$10 million in funding. Winston Sammut, managing director of Maxim Asset Management Ltd. expressed that Centro may not be able to pay legal claims if it fails to refinance its debt, states Bloomberg. About Centro Properties Centro Properties Group -- http://www.centro.com.au/-- is a Melbourne, Australia-based company that comprises the operations of Centro Property Trust and its entities, which are engaged in property investment, property management, property development and funds management. The company operates in two business segments: property ownership business and services business. The Company derives income from retail property rentals of shopping center space to retailers across Australasia and the United States. It also derives income from its retail property investments in listed and unlisted entities. Its services business activities include incorporating funds management, property management and development and leasing. During the fiscal year ended June 30, 2007, the Company acquired New Plan Excel Realty Trust, Heritage Property Investment Trust and Galileo Funds Management, as well as assumed full ownership of its United States management operations. The Troubled Company Reporter-Asia Pacific reported on Jan. 4, 2008, that Standard & Poor's Ratings Services lowered its issuer credit, senior-unsecured debt and preferred stock ratings to 'CCC+' with negative implications reflecting the potential of the group's assets to be sold in softening market conditions, particularly in the U.S. EVERNEW FASHIONS: Placed Under Voluntary Liquidation ---------------------------------------------------- Evernew Fashions Pty. Limited's members agreed on Feb. 21, 2008, to voluntarily liquidate the company's business. In line with this goal, the company has appointed Richard Herbert Judson to facilitate the sale of its assets. The liquidator can be reached at: Richard Herbert Judson Members Voluntarys Pty. Ltd. P.O. Box 819, Moorabbin Victoria 3189 Australia About Evernew Fashions Evernew Fashions Pty. Limited operates family clothing stores. The company is located at East Malvern, in Victoria, Australia. FOSADA PTY: Members to Receive Wind-Up Report on April 8 -------------------------------------------------------- D. R. Vasudevan, Fosada Pty. Ltd.'s appointed estate liquidator, will meet with the company's members on April 8, 2008, to provide them with property disposal and winding-up reports. The liquidator can be reached at: D. R. Vasudevan Pitcher Partners 15 William Street, Level 19 Melbourne, Victoria 3000 Australia About Fosada Pty. Fosada Pty. Ltd. operates holding companies. The company is located at Richmond, in Victoria, Australia. GEORGE BOARD: Members Opt to Liquidate Business ----------------------------------------------- George Board Pty. Limited's members agreed on Feb. 21, 2008, to voluntarily liquidate the company's business. In line with this goal, the company has appointed Richard Herbert Judson to facilitate the sale of its assets. The liquidator can be reached at: Richard Herbert Judson Members Voluntarys Pty. Ltd. P.O. Box 819, Moorabbin Victoria 3189 Australia About George Board George Board Pty Limited, which is also trading as The Plumbing Warehouse, is a distributor of plumbing fixtures, equipment, and supplies. The company is located at Wollongong, in New South Wales, Australia. JAMES MACKENZIE: Members Resolve to Liquidate Business ------------------------------------------------------ James Mackenzie Enterprises Pty. Limited's members agreed on February 21, 2008, to voluntarily liquidate the company's business. In line with this goal, the company has appointed Richard Mansell of R.G.Mansell & Associates to facilitate the sale of its assets. The liquidator can be reached at: Richard Mansell c/o R.G.Mansell & Associates 118 Queen Street, Level 3 Melbourne Australia Telephone:(03) 9603 0090 Facsimile:(03) 9603 0099 About James Mackenzie James Mackenzie Enterprises Pty. Limited operates dental laboratories. The company is located at Chester Hill, in New South Wales, Australia. JPMORGAN: Moody's Junks Rating on Mobius ELR-01 Class C Notes ------------------------------------------------------------- Moody's Investors Service has downgraded four classes of notes issued by JPMorgan Trust Australia Limited in its role as Trustee for the Mobius ELR-01 Trust. Moody's has also retained these notes on review for possible further downgrade. The complete rating action: -- Class A Notes, downgraded to Aa3 from Aaa, retained on review for possible further downgrade; -- Class B Notes, downgraded to Ba2 from Baa2, retained on review for possible further downgrade; -- Class C Notes, downgraded to Caa2 from B2, retained on review for possible further downgrade; -- Class D Notes, downgraded to Ca from Caa2, retained on review for possible further downgrade. The notes are backed by small-ticket equipment leases originated by four Australian originators. Mobius Financial Services Pty. Limited, a specialist Australian white-labelling and servicing company and a division of Allco Finance Group, acts as the Master Servicer and Manager of the transaction. The rating action follows a further deterioration in the performance of the underlying receivables pool, and concerns stemming from the recent events surrounding Allco Finance Group: -- The cumulative level of charge-offs reached over AU$12 million in February 2008. The charge-off rate has not leveled off in the period since the commencement of Moody's review in November 2007. Despite a significant portion of the cumulative losses being met through recovery and ongoing application and reserving of excess spread, the transaction has seen further significant erosion of the credit enhancement available to the rated notes. -- Moody's notes the recent deterioration in the financial standing of Allco Finance Group and its subsidiary, Mobius Financial Services. As part of its strategic review announced in February 2008, Allco Finance Group has taken the decision to exit the Mobius business; it is currently exploring a sale of Mobius to a third party and other alternative arrangements. In addition, Mobius has since ceased its lending program, effectively placing the business in run-off mode. These factors have led to significant uncertainty with regard to the special and master servicing functions undertaken by Mobius in relation to the ELR-01 Trust. -- A large number of receivables has been found not to comply with the eligibility criteria. In accordance with the transaction documentation, Mobius Financial Services has to date repurchased in excess of AUD 5.0 million of receivables. However, future identified ineligible receivables may not be repurchased by Mobius or the underlying originators, leading to some uncertainty with respect to the performance of the portfolio. Moody's ratings address only the credit risks associated with the transaction. Other non-credit risks have not been addressed, but may have significant effect on yield to investors. Moody's ratings are subject to revision, suspension or withdrawal at any time at our absolute discretion. The ratings are expressions of opinion and not recommendations to purchase, sell or hold securities. NEURAGENIX PTY: Members & Creditors Meeting Set for April 2 ----------------------------------------------------------- Neuragenix Pty. Ltd. will hold a final general meeting for its members and creditors at 11:00 a.m. on April 2, 2008. During the meeting, the company's liquidator, Rod Slattery at PPB Chartered Accountants, will provide the attendees with property disposal and winding-up reports. The liquidator can be reached at: Rod Slattery PPB Chartered Accountants 90 Collins Street, Level 10 Melbourne, Victoria 3000 Australia About Neuragenix Pty. Neuragenix Pty. Ltd. provides computer programming services. The company is located at Melbourne, in Victoria, Australia. SIX WHEELER: Members Agree on Voluntary Liquidation --------------------------------------------------- Six Wheeler Conversions Pty. Ltd.'s members agreed on Feb. 21, 2008, to voluntarily liquidate the company's business. In line with this goal, the company has appointed Richard Herbert Judson to facilitate the sale of its assets. The liquidator can be reached at: Richard Herbert Judson Members Voluntarys Pty. Ltd. P.O. Box 819, Moorabbin Victoria 3189 Australia About Six Wheeler Six Wheeler Conversions Pty. Ltd. provides automotive services, except repair and carwashes. The company is located at Dalby, in Queensland, Australia. SLIM FRUIT: Placed Under Voluntary Liquidation ---------------------------------------------- Slim Fruit Pty. Ltd.'s members agreed on February 15, 2008, to voluntarily liquidate the company's business. In line with this goal, the company has appointed Steve Rubner of Arnold Stevens Finlay to facilitate the sale of its assets. The liquidator can be reached at: Steve Rubner Arnold Stevens Finlay Chartered Accountants 410 Church Street, Level 6 North Parramatta 2151 Australia About Slim Fruit Slim Fruit Pty. Limited is involved with the administration of public health programs. The company is located at North Parramatta, in New South Wales, Australia. W & M KLEIN: To Declare First Dividend on May 5 ----------------------------------------------- W & M Klein Pty. Ltd., which is in liquidation, will declare first and final dividend on May 5, 2008. Only creditors who were able to file their proofs of debt by March 11, 2008, will be included in the company's dividend distribution. The company's liquidator is: Andrew Mclellan c/o PPB Chartered Accountants 90 Collins Street, Level 10 Melbourne, Victoria 3000 Australia About W & M Klein Located at Gladysdale, in Victoria, Australia, W & M Klein Pty. Ltd. is an investor relation company. ================================================== C H I N A & H O N G K O N G & T A I W A N ================================================== BANK OF COMMUNICATION: Seeks to Raise CNY5 Bil. by Selling Bonds --------------------------------------------------------------- Bank of Communications Co., Ltd., said on March 19, 2008, that it planned to sell renminbi-denominated bonds in Hong Kong, in a bid to raise CNY5 billion. These bonds will have a term of one to three years, which relies on market interest rates and investors' preference. They will have a fixed interest rate that is to be determined by a book- building exercise. The bank is set to sell the bonds to institutional investors and individual investors in Hong Kong. It intends to use the raised proceeds to make lending and fuel its working capital. The lender expected that the issue would help enhance its operating capacity, improve its asset-liability structure, and fuel its further business development. The Shanghai-based lender is the fifth largest bank in China by assets. The company said on March 20 that it netted profits of CNY20.274 billion in 2007, 65.18% from a year ago, and gained earnings per share of CNY 0.42, rising 55.45%. Bank of Communications Bank of Communications Co Ltd -- http://www.bankcomm.com/-- is a commercial bank in the People's Republic of China. As of December 31, 2005, the bank had 137 branches and sub-branches, in addition, to over 2,600 business outlets in China. It also has its branches in Hong Kong, New York, Tokyo, Singapore and Seoul. The bank's business is divided into four segments: corporate banking, retail banking, treasury and others. Its corporate banking business provides products and services to the corporate customers, such as loans, deposits, bill discounting, trade finance, fund custody and guarantees. The retail banking business provides retail banking products and services to its retail customers, such as deposits, mortgage loans, debit cards, credit cards, wealth management and foreign exchange trading services. The treasury operations include inter-bank money market transactions, foreign exchange trading and government, and finance bond trading and investment. The bank carries Fitch Rating's 'D' individual rating effective on November 21, 2005. On May 4, 2007, as part of the application of its refined joint default analysis and updated bank financial strength rating methodologies, Moody's Investors Service affirmed Bank of Communications' D Bank Financial Strength Rating. COMEGLORY TRADING: Court to Hear Wind-Up Proceedings on April 16 ---------------------------------------------------------------- On February 22, 2008, Industrial and Commercial bank of China (Asia) Limited, filed a petition to have Comeglory Trading Company Limited operations wound up. The High Court of Hong Kong will convene at 9:30 a.m. on April 30, 2008, to hear the petition. The petitioners' solicitors can be reached at: Ho and Wong Room 1408-1411 14th Floor China Merchants Tower Shun Tak Centre 168-200 Connaught Road Central, Hong Kong DOUBLE KEEN: Court to Hear Wind-Up Proceedings on April 30 ---------------------------------------------------------- On March 5, 2008, Bank of China (Hong Kong) Limited, filed a petition to have Double Keen Industrial Limited operations wound up. The High Court of Hong Kong will convene at 9:30 a.m. on April 30, 2008, to hear the petition. The petitioners' solicitor can be reached at: Anthony Chaing & Partners 3909 Tower 2, Lippo Centre 89 Queensway, Central, Hong Kong GENTLEMAN GIVENCHY: Members Meeting Fixed for April 15 ------------------------------------------------------ The members of Gentleman Givenchy (Far East) Limited will have their final meeting on April 15, 2008, at Level 28, Three Pacific Place, 1 Queen's Road, East, in Hong Kong to hear the liquidator's report on the company's wind-up proceedings and property disposal. The liquidators can be reached at: Ying Hing Chiu Chung Mui Yin, Diana Level 28 Three Pacific Place 1 Queen's Road, East Hong Kong ICBC: Inks US$1-Billion Resource Fund Deal with Standard Bank ------------------------------------------------------------- The Industrial and Commercial Bank of China has signed a final agreement with South Africa's Standard Bank to jointly set up a US$1 billion global resource fund, a person familiar with the matter told Reuters. According to Reuters, a formal announcement on the deal would be made by the biggest Chinese lender as early as this week. State-run ICBC, which recently bought a 20% stake in Standard Bank for about US$5.5 billion, was not immediately available for comments, Reuters says. Standard Bank has said in October that it and ICBC were discussing the launch of a global resource fund with a targeted size of US$1 billion. The fund would focus on opportunities in Africa and China, specifically in the junior mining and energy sectors. Standard Bank then announced early this month that they were finalizing the terms of the fund in which each would invest US$200 million with the remainder made up of third-party funding, Reuters further notes. Reuters relates that China is trying to boost its investment in the overseas resources sector as its demand for energy and metals surges amid a booming economy. 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. On May 4, 2007, with the implementation of the new methodologies, Moody's Investors Service affirmed Industrial & Commercial Bank of China Ltd's Bank Financial Strength Rating at D-. The outlook for BFSR is stable. The long-term Foreign Currency Deposit Rating is A2. The short-term Foreign Currency Deposit Rating is P-1. The outlook for the long-term deposit rating is positive. KINGTEC SYSTEMS: Court to Hear Wind-Up Proceedings on April 23 -------------------------------------------------------------- On February 29, 2008, Pan-Hong Kong Limited, filed a petition to have Kingtec Systems Limited operations wound up. The High Court of Hong Kong will convene at 9:30 a.m. on April 23, 2008, to hear the petition. The petitioners' solicitor can be reached at: Simon S.M. Kwok & Co Unit B, 12th Floor Two Chinachem Plaza No. 135 Des Voeux Road Central, Hong Kong METALSOLV SOFTWARE: Commences Liquidation Proceedings ----------------------------------------------------- Metalsolv Software (Hong Kong) Limited's members agreed February 29, 2008 to voluntarily liquidate the company's business. In line with this goal, the company has appointed Rainer Hok Chung Lam and John James Toohey to facilitate the sale of its assets. The liquidators can be reached at: Rainer Hok Chung Lam John James Toohey 22nd Floor Prince's Building Central, Hong Kong PETROLEOS DE VENEZUELA: To Ask Exxon Compensation for Damages ------------------------------------------------------------- Petroleos de Venezuela SA's President and Venezuelan Oil and Energy Minister Rafael Ramirez has indicated that the company will seek compensation for damages that Exxon Mobil Corp.'s lawsuit brought to the firm, Venezuelanalysis.com reports. Minister Ramirez told Venezuelanalysis.com that damages include a sharp drop in bond ratings after the asset freeze. As reported in the Troubled Company Reporter-Latin America on March 24, 2008, Judge Paul Walker of London Court dissolved an injunction freezing US$12 billion assets belonging to Petroleos de Venezuela. Petroleos de Venezuela won the legal battle because the dispute has no connection with the U.K. Exxon, which has battled in arbitration to bag compensation for an oil field President Hugo Chavez seized last year. According to Venezuelanalysis.com, the Venezuelan government gave Exxon Mobil until last Thursday to undo the damage it had done to the international reputation of Petroleos de Venezuela for pursuing a US$12 billion freeze of its assets during international arbitration in a dispute over the nationalization of the Orinoco Oil Belt project. Minister Ramirez told Venezuelanalysis.com that Exxon repeatedly tried to deceive the court by claiming that Petroleos de Venezuela isn't a state enterprise, that it is broken, and that the Venezuelan government has brought it "to a state of financial precariousness." Exxon Mobil could be obligated to pay over US$1 billion in damages to Petroleos de Venezuela, which would cancel out what the Venezuelan firm owed the US company's nationalized stake in the Cerro Negro project, and Exxon Mobil would have to deal with "grave consequences, not only in terms of international prestige... but in what they will face with their stockholders," Venezuelanalysis.com notes, citing David Paravisini, Venezuelan Ambassador to Guatemala and an engineer and expert on petroleum policy. Reports say that Exxon Mobil legal representative Alan Jeffers said that no appeal will be made on Judge Walker's decision. The court decision didn't challenge Exxon Mobil's overall goals against Petroleos de Venezuela, but instead established that the London court lacked jurisdiction over the case, Mr. Jeffers told Venezuelanalysis.com. Petroleos de Venezuela SA -- http://www.pdv.com/-- is Venezuela's state oil company in charge of the development of the petroleum, petrochemical and coal industry, as well as planning, coordinating, supervising and controlling the operational activities of its divisions, both in Venezuela and abroad. The company has a commercial office in China. PDVSA is one of the top exporters of oil to the US with proven reserves of 77.2 billion barrels of oil -- the most outside the Middle East -- and about 150 trillion cu. ft. of natural gas. PDVSA's exploration and production take place in Venezuela, but the company also has refining and marketing operations in the Caribbean, Europe, and the US. * * * As of Feb. 14, 2008, Fitch Ratings held Petroleos de Venezuela SA's long-term issuer default rating and local currency long term issuer default rating at BB-. Fitch said the ratings outlook is negative. PIONEER NATIONAL: Commences Liquidation Proceedings --------------------------------------------------- Pioneer National (Fashion Outlet) Limited's members agreed February 29, 2008 to voluntarily liquidate the company's business. In line with this goal, the company has appointed Yui Cho Yan to facilitate the sale of its assets. The liquidator can be reached at: Yui Cho Yan Room 1702 17th Floor Asian House 1 Hennesy Road Wanchai, Hong Kong SHENZHEN DEV'T: Sells CNY6.5 Billion of 10-year Bonds ----------------------------------------------------- Shenzhen Development Bank has sold CNY6.5 billion (US$922 million) in 10-year bonds, the deal's sole underwriter UBS told Reuters. Local currency bond markets remain healthy at a time of global volatility. According to Reuters, the deal marked UBS's first deal in the yuan bond market, which was done via its unit UBS Securities. UBS and Goldman Sachs are the only foreign firms with an underwriting license for Chinese domestic markets, while other global lenders have used joint ventures to crack the country's capital markets. Shenzhen Bank, which is nearly 18% owned by U.S. private equity firm Newbridge Capital, sold lower Tier 2 fixed-rate bonds with a 10-year maturity and not callable for five years at a 6.10% coupon, Reuters reports, citing UBS Securities' statement. The lender, based in the southern Chinese boom town of Shenzhen, also sold a floating-rate tranche at 140 basis points over SHIBOR, Reuters relates. Both coupons will increase by 300 basis points if the instruments are not called. Reuters also notes, citing data from Thomson Financial, that the yuan bond market has seen about CNY30.1 billion worth of bond issuance so far this year out of nine issuers, surpassing the CNY4.8 billion seen in the equivalent period of 2007. 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 Moody's Investors Service, on May 4, 2007, assigned E+ for the bank's Financial Strength Rating. The long-term Foreign Currency Deposit Rating is Ba3. The short-term Foreign Currency Deposit Rating is NP. Moody's said the outlook for all ratings is positive. SPL WORLDGROUP: Commences Liquidation Proceedings ------------------------------------------------- SPL Worldgroup Hong Kong Limited's members agreed February 29, 2008 to voluntarily liquidate the company's business. In line with this goal, the company has appointed Rainer Hok Chung Lam and John James Toohey to facilitate the sale of its assets. The liquidators can be reached at: Rainer Hok Chung Lam John James Toohey 22nd Floor Prince's Building Central, Hong Kong UNIVERSAL ALUMINUM: Wind-Up Hearing Set for April 16 ---------------------------------------------------- On February 29, 2008, Universal Aluminum & Steel Engineering Limited, filed a petition to have their operations wound up. The High Court of Hong Kong will convene at 9:30 a.m. on April 16, 2008, to hear the petition. The petitioners' solicitor can be reached at: Knight & Ho Room 904B, 9th Floor Admiralty Centre, Tower 1 No. 18 Harcourt Road Admiralty Hong Kong WAI TAT: Court to Hear Wind-Up Proceedings on April 16 -------------------------------------------------------- On February 25, 2008, Wai Tat Iron Engineering Limited, filed a petition to have its operations wound up. The High Court of Hong Kong will convene at 9:30 a.m. on April 16, 2008, to hear the petition. The petitioners' solicitor can be reached at: Knight & Ho Room 904B, 9th Floor Admiralty Centre, Tower 1 No. 18 Harcourt Road Admiralty Hong Kong WINNING SUCCESS: Appoints New Liquidators ----------------------------------------- The members of Winning Success Limited appointed Chan Pang Ching as the company's liquidator. The Liquidator can be reached at: Chan Pang Ching Room 1806 Bank Centre 636 Nathan Road Kowloon ========= I N D I A ========= ICICI BANK: To Invest INR11.5 Billion in Jaypee Infratech --------------------------------------------------------- ICICI Bank Limited will invest a 1% stake worth INR11.5 billion in Jaiprakash Associates Ltd.'s unit Jaypee Infratech Ltd., Thomson Financial reports. According to the report, the investment will comprise INR2.5 billion cash and a long-term loan of INR9 billion. Headquartered in Mumbai, India, ICICI Bank Limited -- http://www.icicibank.com/-- is a financial services group providing a variety of banking and financial services, including project and corporate finance, working capital finance, venture capital finance, investment banking, treasury products and services, retail banking, broking and insurance. It also has interests in the software development, software services and business process outsourcing businesses. The Company's operations have been classified into three segments: Commercial Banking, Investment Banking and Others. It has subsidiaries in the United Kingdom, Canada and Russia, branches in Singapore and Bahrain, and representative offices in the United States, China, United Arab Emirates, Bangladesh and South Africa. * * * On Aug. 15, 2006, Standard & Poor's assigned its 'BB-' rating to the hybrid Tier-1 securities to be issued by ICICI Bank Ltd. On Oct. 16, S&P assigned its 'BB+' issue rating to the bank's senior unsecured, five-year, fixed-rate U.S. dollar notes. GENERAL MOTORS: Extended Strike Spurs S&P's Negative CreditWatch ---------------------------------------------------------------- Standard & Poor's Ratings Services placed the ratings on General Motors Corp., American Axle & Manufacturing Holdings Inc., Lear Corp., and Tenneco Inc. on CreditWatch with negative implications. The CreditWatch placement reflects S&P's decision to review the ratings in light of the extended American Axle (BB/Watch Neg/--) strike. The work stoppage that began Feb. 25 at American Axle's U.S. United Auto Workers plants has forced closure of many GM (B/Watch Neg/B-3) plants, as well as plants of certain GM suppliers. The strike began after the expiration of the four- year master labor agreement with American Axle. Although S&P still expects American Axle and the UAW to reach an agreement that will reflect more competitive labor costs, the timing is unknown. The two sides resumed negotiations last week. "We believe the strike has gone on long enough to possibly begin to affect the financial resources of GM and those suppliers most exposed to the automaker," said Standard & Poor's credit analyst Robert Schulz. To resolve the CreditWatch listings, Standard & Poor's will assess the strike's impact on the companies' credit profiles, particularly liquidity, once production resumes. S&P could lower the ratings any time prior to a resolution of the Axle strike if the liquidity of the companies becomes compromised, although downgrades are not likely for another several weeks. QUEBECOR WORLD: Has US$350 Million in Available Funds ----------------------------------------------------- Quebecor World Inc. provided an update on the currently ongoing chapter 11 proceedings of Quebecor World (USA) Inc. and its affiliated debtors. As of March 7, 2008, the company had more thanUS$225 million of cash on hand and more thanUS$125 million of additional borrowings available under theUS$750 million debtor-in- possession financings for a total of more thanUS$350 million of availability. The company also expects to generate significant free cash flow in 2008. On March 7, 2008, Judge James M. Peck of the U.S. Bankruptcy Court for the Southern District of New York extended by 30 days the date by which the final order approving the debtorsUS$1 billion debtor-in-possession financing, previously authorized by the Court, must be entered in order to allow the parties sufficient time to address certain remaining issues. During this extended period, all of the terms and conditions of the interim order previously entered by the Court approving the debtor-in-possession financing remain in effect, including the company's right to borrow up toUS$750 million under the debtor- in-possession financings. About Quebecor World Based in Montreal, Quebec, Quebecor World Inc. (TSX: IQW) (NYSE: IQW), -- http://www.quebecorworldinc.com/-- provides market solutions, including marketing and advertising activities, well as print solutions to retailers, branded goods companies, catalogers and to publishers of magazines, books and other printed media. It has 127 printing and related facilities located in North America, Europe, Latin America and Asia. In the United States, it has 82 facilities in 30 states, and is engaged in the printing of books, magazines, directories, retail inserts, catalogs and direct mail. In Canada it has 17 facilities in five provinces, through which it offers a mix of printed products and related value-added services to the Canadian market and internationally. The company is an independent commercial printer in Europe with 19 facilities, operating in Austria, Belgium, Finland, France, Spain, Sweden, Switzerland and the United Kingdom. In March 2007, it sold its facility in Lille, France. Quebecor World (USA) Inc. is its wholly owned subsidiary. Quebecor World and 53 of its subsidiaries, including those in Canada, filed a petition under the Companies' Creditors Arrangement Act before the Superior Court of Quebec, Commercial Division, in Montreal, Canada, on Jan. 20, 2008. The Honorable Justice Robert Mongeon oversees the CCAA case. Francois-David Pare, Esq., at Ogilvy Renault, LLP, represents the Company in the CCAA case. Ernst & Young Inc. was appointed as Monitor. On Jan. 21, 2008, Quebecor World (USA) Inc., its U.S. subsidiary, along with other U.S. affiliates, filed for chapter 11 bankruptcy on Jan. 21, 2008 (Bankr. S.D.N.Y Lead Case No. 08-10152). Anthony D. Boccanfuso, Esq., at Arnold & Porter LLP represents the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors is represented by Akin Gump Strauss Hauer & Feld LLP. Based in Corby, Northamptonshire, Quebecor World PLC -- http://www.quebecorworldplc.com/-- is the U.K. subsidiary of Quebecor World Inc. that specializes in web offset magazines, catalogues and specialty print products for marketing and advertising campaigns. The company employs around 290 people. Quebecor PLC was placed into administration with Ian Best and David Duggins of Ernst & Young LLP appointed as joint administrators effective Jan. 28, 2008. As of Sept. 30, 2007, Quebecor World's unaudited consolidated balance sheet showed total assets ofUS$5,554,900,000, total liabilities ofUS$3,964,800,000, preferred shares ofUS$175,900,000, and total shareholders' equity of US$1,414,200,000. The company has until May 20, 2008, to file a plan of reorganization in the Chapter 11 case. The Debtors' CCAA stay has been extended to May 12, 2008. (Quebecor World Bankruptcy News, Issue No. 9; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) * * * As reported in the Troubled Company Reporter on Feb. 13, 2008, Moody's Investors Service assigned a Ba2 rating to the US$400 million super priority senior secured revolving term loan facility of Quebecor World Inc. as a Debtor-in-Possession. The related US$600 million super priority senior secured term loan was rated Ba3 (together, the DIP facilities). The RTL's better asset value coverage relative to the TL accounts for the ratings' differential. QUEBECOR WORLD: Noteholders Question Panel Advisors' Engagement --------------------------------------------------------------- The Ad Hoc Group of Quebecor Noteholders tells Judge James M. Peck of the U.S. Bankruptcy Court for the Southern District of New York that it questions the Official Committee of Unsecured Creditors' decision to retain two sets of financial advisors on top of the numerous financial advisors already at work in the Debtors' cases on behalf of unsecured creditors. The Noteholder Group is currently engaged in discussions with the Creditors' Committee with respect to the consensual division of labor between Mesirow Financial Consulting LLC, and Jefferies & Company, Inc. It is hopeful that an appropriate arrangement can be reached in short order. "Until agreement is reached, however, the Noteholder Group submits that the addition of yet two more financial advisors can only lead to duplication of effort and wasted resources. Furthermore, the burden is on the Creditors' Committee to show why it needs two financial advisors in [the Debtors'] cases -- a burden it has not met," Alan W. Kornberg, Esq., at Paul, Weiss, Rifkind, Wharton & Garrison LLP, in New York, says. U.S. Trustee Concerned with Likely Duplication of Efforts Diana G. Adams, the United States Trustee for Region 2, is concerned about the division of responsibilities between Jefferies and Mesirow, the potential for duplication of efforts between the firms, and any resulting inefficiencies and adverse cost implications on the estates. To that end, the United States Trustee has raised the issue with counsel to the Creditors' Committee. The U.S. Trustee's trial attorney, Andrew D. Velez-Rivera, relates that Jefferies and Mesirow have met for the purpose of establishing a division of responsibilities between the firms, and agreed upon an allocation of services to the Creditors' Committee. The Office of the United States Trustee has been advised of the specific tasks to be performed by each of the firms, and of the division of responsibilities between them. The United States Trustee has no objection to that allocation, and the Creditors' Committee has agreed to notify the Office of the United States Trustee in the event the division of responsibilities between Jefferies and Mesirow changes during the course of their representation of the Committee. Committee Wants Ad Hoc Committee's Objection Overruled "The [Ad Hoc Noteholder Group's] Objection should be overruled," according to Ira S. Dizengoff, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, representing the Official Committee of Unsecured Creditors. Mr. Dizengoff says that the Ad Hoc Noteholder Group's objection lack merit since the Committee, in the careful exercise of its business judgment has concluded that it needs the services of both a sophisticated forensic accounting and financial advisory firm with significant international experience (Mesirow) and an investment banking firm with significant capital market experience (Jefferies). Mr. Dizengoff relates that the advisory services to be provided by Mesirow and Jefferies are discreet and independent from each other. "Indeed, each firm's responsibilities have been carefully negotiated to avoid duplication, appropriately make use of [the] firm's abilities and ultimately assist the Committee in analyzing the Debtors' business operations, financial results and reorganization efforts," Mr. Dizengoff adds. Mr. Dizengoff also points out that the Committee cannot and should not, as the Ad Hoc Noteholder Group suggests, abdicate its fiduciary responsibilities to the Ad Hoc Noteholder Group, the Prepetition Bank Group or the Monitor. "The Ad Hoc Noteholder Group cannot hold the Committee hostage to its demand that there be an agreed upon process on who takes a leading role on a particular issue," Mr. Dizengoff relates. While the Ad Hoc Noteholder Group is free to rely on the Committee, Mr. Dizengoff says that the reverse is not true. Mr. Dizengoff delineates each firm's role: Mesirow Financial Consulting Jefferies & Co. (Forensic Accntg./ Financial (Investment banking Services) Advisory Services) ---------------------------- ---------------------------- (a) Fraudulent transfers (a) Fraudulent transfers including lien pledge including lien pledge to pre-petition lenders pre-petition lenders - Capital Market analysis - Forensic analysis - Facts analysis (b) DIP objection/ amendments (b) Preference and avoidance actions including repayment of private notes (c) Major asset sales (c) Review and analysis of - M&A transactions plant closures - Cost analysis (d) Non-public(i.e. management (d) 13 week cash flow monthly operating analysis reports, by business - Cash receipts and and geographic region) disbursements (e) Publicly filed Monthly (e) AR securitization facility Operating Reports (f) Executory contracts (f) Executory contracts - to be determined - to be determined (g) Employee retention and (g) Pension funding status compensation plans (h) Business plans analysis (h) Intercompany transactions and review (i) Advise on current state (i) Critical vendor/ of the restructuring/ reclamation capital markets (j) Analyzing any potential (j) Liquidation analysis or proposed strategy for restructuring or adjusting the Debtors' outstanding indebtedness or overall capital structure (k) Exit financing (k) Exit financing - Lender selection and - Cash flow and covenants economics - Collateral analysis (l) Debt capacity analysis About Quebecor World Based in Montreal, Quebec, Quebecor World Inc. (TSX: IQW) (NYSE: IQW), -- http://www.quebecorworldinc.com/-- provides market solutions, including marketing and advertising activities, well as print solutions to retailers, branded goods companies, catalogers and to publishers of magazines, books and other printed media. It has 127 printing and related facilities located in North America, Europe, Latin America and Asia. In the United States, it has 82 facilities in 30 states, and is engaged in the printing of books, magazines, directories, retail inserts, catalogs and direct mail. In Canada it has 17 facilities in five provinces, through which it offers a mix of printed products and related value-added services to the Canadian market and internationally. The company is an independent commercial printer in Europe with 19 facilities, operating in Austria, Belgium, Finland, France, Spain, Sweden, Switzerland and the United Kingdom. In March 2007, it sold its facility in Lille, France. Quebecor World (USA) Inc. is its wholly owned subsidiary. Quebecor World and 53 of its subsidiaries, including those in Canada, filed a petition under the Companies' Creditors Arrangement Act before the Superior Court of Quebec, Commercial Division, in Montreal, Canada, on Jan. 20, 2008. The Honorable Justice Robert Mongeon oversees the CCAA case. Francois-David Pare, Esq., at Ogilvy Renault, LLP, represents the Company in the CCAA case. Ernst & Young Inc. was appointed as Monitor. On Jan. 21, 2008, Quebecor World (USA) Inc., its U.S. subsidiary, along with other U.S. affiliates, filed for chapter 11 bankruptcy on Jan. 21, 2008 (Bankr. S.D.N.Y Lead Case No. 08-10152). Anthony D. Boccanfuso, Esq., at Arnold & Porter LLP represents the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors is represented by Akin Gump Strauss Hauer & Feld LLP. Based in Corby, Northamptonshire, Quebecor World PLC -- http://www.quebecorworldplc.com/-- is the U.K. subsidiary of Quebecor World Inc. that specializes in web offset magazines, catalogues and specialty print products for marketing and advertising campaigns. The company employs around 290 people. Quebecor PLC was placed into administration with Ian Best and David Duggins of Ernst & Young LLP appointed as joint administrators effective Jan. 28, 2008. As of Sept. 30, 2007, Quebecor World's unaudited consolidated balance sheet showed total assets ofUS$5,554,900,000, total liabilities ofUS$3,964,800,000, preferred shares ofUS$175,900,000, and total shareholders' equity of US$1,414,200,000. The company has until May 20, 2008, to file a plan of reorganization in the Chapter 11 case. The Debtors' CCAA stay has been extended to May 12, 2008. (Quebecor World Bankruptcy News, Issue No. 9; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) * * * As reported in the Troubled Company Reporter on Feb. 13, 2008, Moody's Investors Service assigned a Ba2 rating to the US$400 million super priority senior secured revolving term loan facility of Quebecor World Inc. as a Debtor-in-Possession. The related US$600 million super priority senior secured term loan was rated Ba3 (together, the DIP facilities). The RTL's better asset value coverage relative to the TL accounts for the ratings' differential. TATA MOTORS: To Buy Jaguar and Land Rover for US$2.3 Billion ------------------------------------------------------------ Tata Motors Ltd. has signed a definitive agreement with Ford Motor Co. for the acquisition of the Jaguar and Land Rover units for US$2.3 billion. The parties announced their entry into the agreement yesterday, which deal comprises the purchase of the two units' brands, plants and Intellectual Property Rights. According to media releases, Tata Motors will pay approximately US$2.3 billion to Ford Motor in cash upon closing of the transaction. At closing, Ford will then contribute up to approximately US$600 million to the Jaguar Land Rover pension plans. The transfer of ownership to Tata Motors is expected to close by the end of the next quarter, subject to applicable regulatory approvals. "These are vanity products and probably these brands will have a tough time in a weak economy," Edwin Merner, President of Atlantis Investment Research Corp. in Tokyo told Bloomberg News. Mumbai-based Tata Motors "will have trouble doing well in this sort of environment," he said. Sales for the two luxury brands have dropped as the global markets are experiencing a slowdown. Jaguar sales in January and Februray were 33% lower in the United States and Europe. Land Rover sales for the first two months dropped 7.7% in Europe and 13% in the U.S. "Turning around Jaguar will be a major challenge," Ashvin Chotai, a London-based independent Asian automobile analyst, told Bloomberg. "Tata will need to tread carefully and ensure there is no negative impact on these brands." Tata Motors' Statement Commenting on the agreement, Chairman of Tata Sons and Tata Motors, Ratan N. Tata, said, "We are very pleased at the prospect of Jaguar and Land Rover being a significant part of our automotive business. We have enormous respect for the two brands and will endeavour to preserve and build on their heritage and competitiveness, keeping their identities intact. We aim to support their growth, while holding true to our principles of allowing the management and employees to bring their experience and expertise to bear on the growth of the business." Tata Motors points out that Jaguar Land Rover's employees, trades unions and the U.K. Government have been kept informed of developments as the sale process progressed and have indicated their support for the agreement. Ford Motor's Statement Ford said the transaction is the culmination of its decision last August to explore strategic options for the Jaguar Land Rover business, as the company accelerates its focus on its core Ford brand and �One Ford� global transformation. "Jaguar and Land Rover are terrific brands," said Alan Mulally, president and CEO, Ford Motor Company. "We are confident that they are leaving our fold with the products, plan and team to continue to thrive under Tata�s stewardship. Now, it is time for Ford to concentrate on integrating the Ford brand globally, as we implement our plan to create a strong Ford Motor Company that delivers profitable growth for all." "This is a good agreement. It provides the Jaguar Land Rover management team and employees with the assurances needed to maintain their focus on delivering the best results for the business," said Lewis Booth, executive vice president, Ford Motor Company, who has responsibility for Ford of Europe, Volvo and Jaguar Land Rover. "I am confident that, under its new owner, Jaguar Land Rover will continue to build upon the significant improvements and product successes it has achieved in recent years." Speaking on behalf of Jaguar Land Rover, Geoff Polites, chief executive officer, said: "Jaguar Land Rover�s management team is very pleased that Ford and Tata Motors have come to an agreement [yesterday]. Our team has been consulted extensively on the deal content and feels confident that it provides for the business needs of both our brands going forward. "We have also had the opportunity to meet senior executives from Tata Motors and the Tata group," Polites continued. "They have expressed confidence in the team that has delivered significant improvements in Jaguar Land Rover�s business performance. We feel confident that we can forge a strong working relationship with our new parent company, and we look forward to a bright and successful future for Jaguar Land Rover." Additional Tata-Ford Deals As part of the transaction, Ford will continue to supply Jaguar Land Rover for differing periods with powertrains, stampings and other vehicle components, in addition to a variety of technologies. Ford also has committed to provide engineering support, including research and development, plus information technology, accounting and other services. In addition, Ford Motor Credit Company will provide financing for Jaguar and Land Rover dealers and customers during a transitional period, which can vary by market, of up to 12 months. The parties believe these arrangements will support Jaguar Land Rover's current product plans, while providing Jaguar Land Rover with the freedom to develop its own standalone capabilities in the future that will best serve its premium manufacturer requirements. About Jaguar and Land Rover Founded in 1922, Jaguar has been amongst the premium brands for luxury saloons and sports cars. Since its very first design appeared in 1948, Land Rover has always been universally identified as the ultimate in four-wheel drive vehicles. Jaguar and Land Rover have been under Ford�s ownership since 1989 and 2000 respectively. The two together have about 16,000 employees. About Tata Motors India's largest automobile company, Tata Motors Limited -- http://www.tatamotors.com/-- is mainly engaged in the business of automobile products consisting of all types of commercial and passenger vehicles, including financing of the vehicles sold by the Company. The Company's operating segments consists of Automotive and Others. In addition to its automotive products, it offers construction equipment, engineering solutions and software operations. Tata Motors has operations in Russia and the United Kingdom. * * * Standard & Poor's Ratings Services, on July 13, 2007, assigned its 'BB+' issue rating to the proposed US$490 million zero- coupon convertible bonds of India's Tata Motors Ltd. (BB+/Stable/--). The bonds represent a direct, unsecured and unsubordinated obligation of the company. Proceeds from the bonds will be used for capital expenditure, overseas investments, acquisitions, and other general corporate purposes. Moody's Investors Service, on July 26, 2005, gave Tata Motors 'Ba1' long-term corporate family and senior unsecured debt ratings. ================= I N D O N E S I A ================= BANK INTERNASIONAL: Receives Maybank's US$2.7-Billion Offer ----------------------------------------------------------- Malayan Banking Berhad has entered into a conditional sale and purchase agreement to acquire up to 100% of Sorak Financial Holdings Pte Ltd. for a cash consideration of approximately US$1.5 billion (RM4.8 billion) paving the way for Malaysia's largest financial services group to be the controlling shareholder of Bank Internasional Indonesia -- BII. The transaction price was agreed on a willing-buyer and willing- seller basis. Sorak is 75%-owned by Financial Fullerton Financial Holdings Pte. Ltd., a wholly owned subsidiary of Temasek Holdings (Private) Limited, and 25%-owned by Kookmin Bank. Sorak holds about 56% equity interest in BII. As a result of this transaction, Maybank will also be making a tender offer for the remaining 44.3% shares held by remaining shareholders of BII. The total amount involved for the tender offer is approximately US$1.2 billion (RM3.8 billion), bringing the total value of the potential acquisition to about RM8.6 billion. Maybank was among several other global financial institutions which participated in a competitive bid to acquire Temasek Holdings' stake in BII. Maybank Acting Chief Executive Officer Dato' Aminuddin Md Desa said, "We are delighted with the outcome and are excited moving forward given the significant value in BII's banking franchise and infrastructure. It provides us with an excellent platform to capitalize on growth opportunities with limited execution risks, coupled with the strong underlying fundamentals of the Indonesian economy. The existing management team is also highly experienced and strategically aligned with Maybank's aspirations for Indonesia." "The strategic and financial rationale for the acquisition is extremely compelling. The acquisition will transform our growth prospects in Indonesia and is a huge step forward in our strategy to regionalize our operations through investments in selected high growth markets. We are excited as the Indonesian banking sector remains under-penetrated with excellent long-term growth potential. BII is well placed to capitalize on this growth potential given its strong market position, extensive multi-channel distribution network and high quality customer base. This acquisition effectively enables Maybank to leapfrog into the Indonesian banking market with a significant, well- established presence and attractive platform for further growth," he added. Fullerton Financial Holdings Director Tow Heng Tan said, "Maybank is an established financial institution with an outstanding track record in Malaysia. We are confident that it will lend strength to BII to support its growth in the next phase of its development." He added, "We have been most encouraged by the high level of interest in BII � this confirms our own optimism about the prospects for Indonesia over the longer term." BII has an established banking franchise in Indonesia with a reputation for service quality and production innovation. Maybank with its solid track record and experience in the Indonesian market is well positioned to leverage on BII's excellent infrastructure to further grow the business. In addition, there are also significant revenue synergies given the established and rapidly growing presence of Malaysian corporates in Indonesia and the strong trade flows between the two countries. Indonesia is the fourth most populous nation in the world and banking penetration remains relatively low. Prospects for value creation in the medium term are also excellent as Maybank can leverage on its experience in Malaysia to augment the product offering and banking capabilities of BII, particularly in areas such as Islamic banking, bancassurance and Takaful. Bank Negara Malaysia has given its approval for the proposed acquisition. The proposed acquisition is now conditional upon regulatory approval from Bank Indonesia and the approval of Maybank shareholders. The proposed acquisition is expected to be completed within six months following the receipt of the above approvals, after which Maybank will make a tender offer for the remaining shares in BII. Maybank has appointed Aseambankers and BNP Paribas as advisors for the acquisition. About Bank Internasional PT Bank Internasional Indonesia Tbk -- http://www.bii.co.id/-- engages in general banking services and in other banking activities based on Syariah principles. The bank's services are divided into three categories: Personal Services, consisting of Funding, Credit Card Services, Loan, Reksadana and Bancassurance; Corporate Services, consisting of Funding, Credit Card Services, Loan and Investment Banking, and Platinum Services, consisting of Platinum Access, Syariah Platinum Access and Platinum MasterCard. The bank is headquartered in Jakarta, Indonesia. With a total customer deposit base of more than IDR34 trillion and over IDR47 trillion in assets, Bank Internasional is one of the largest banks in Indonesia with an international network that comprises over 230 branches and 700 ATMs across Indonesia, as well as a banking presence in Mauritius, Mumbai and the Cayman Islands. The Troubled Company Reporter-Asia Pacific reported on March 3, 2008, Fitch Ratings has affirmed PT Bank Internasional Indonesia Tbk's(BII) long-term foreign currency Issuer Default Rating at 'BB', following Fullerton Financial Holdings' announcement of its intentions to pursue the sale of its interest in BII. FFH is a wholly owned subsidiary of Temasek Holdings. On October 19, 2007, Moody's Investors Service raised the foreign currency long-term debt and foreign currency long-term deposit ratings of PT Bank Internasional Indonesia Tbk. -- The issuer/foreign currency subordinated debt ratings were raised to Ba2/Ba2 from Ba3/Ba3 and foreign currency long- term deposit rating to B1 from B2 -- The Not Prime foreign currency short-term deposit rating, Baa3 global local currency deposit rating and D BFSR were unaffected. On Aug. 15, 2007, that Fitch Ratings affirmed all the ratings of Bank Internasional as follows: * Long-term foreign currency IDR at 'BB-' with a Positive Outlook, * Short-term foreign currency IDR at 'B', * Individual Rating 'C/D', * Support Rating '4', Support Rating Floor 'B' and * National Rating 'AA-(idn)'. BANK MEGA: Projects 40.7% Increase in Net Profit ------------------------------------------------ PT Bank Mega Tbk projects a 40.7% increase in its net profit to IDR732 billion form IDR520.7 billion last year, on the back of estimated higher growth in lending, The Jakarta Post reports. According to the report, Bank President Director Yungky Setiawan said the bank is optimistic that its target would be achieved because party funds were likely to increase, fueling the bank's capacity to generate loans. "Third-party funds are expected to increase by up to IDR35.1 trillion this year, from IDR30 trillion last year," he added. Mr. Setiawan told the news agency that IDR8.5 trillion of the expected third-party funds would come from accounts, IDR7.8 trillion from savings and IDR35.1 trillion from term deposits. The bank, the report notes, was also expecting a 39% increase in this year's lending to IDR19.5 trillion from IDR14.03 trillion in 2007. "The biggest proportion of lending will still go to the corporate sector, followed by the commercial sector and consumers, which is mostly used for mortgages," Mr. Setiawan was quoted by The Post as saying. The Post recounts that the banks 2007 net profit increased 243.3% from IDR151.7 billion in 2006, due to higher lending growth and lower costs of funds. In 2007, the bank's loans for the corporate sector reached IDR6.5 trillion; commercial loans reached IDR2.13 trillion and consumer loans reached IDR1.8 trillion, while nonperforming loans stood at 1.53%, from 1.68% in 2006, the report adds. About Bank Mega Headquartered in Jakarta, Indonesia PT Bank Mega Tbk -- http://www.bankmega.com/-- is an Indonesia-based financial institution. The Bank's business activities consist of: commercial banking, corporate banking and consumer banking. Its products and services include Personal, which consists of savings, lending, credit cards, e-banking and special services; Business, which comprises business savings, business lending, special finance and business services; Treasury, which includes bank notes, currency swaps and general; Trade Finance, which consists of letters of credit, bank guarantees and standby letters of credit, and Corporate, which provides corporate services. The Bank is supported by 54 branch offices, 93 supporting branch offices and two cash offices. As reported by the Troubled Company Reporter - Asia Pacific on Feb. 25, 2008, Fitch ratings has taken rating actions on PT Bank Mega Tbk. The bank's Support Ratings Floors have been upgraded to 'BB-' from 'B+' or 'B' previously to reflect the stronger financial ability of the sovereign state to provide support. PT Bank Mega Tbk -- Support rating affirmed at '4'; -- Individual rating affirmed at 'D'; -- National Long-term affirmed at 'A+(idn)'. PERUSHAAN LISTRIK: To Provide Free Power Connection in Sulawesi --------------------------------------------------------------- PT Perusahaan Listrik Negara will provide two million light & heat energy (LHE) power connections for free for 450 VA household customers in South Sulawesi, Antara News reports. Irwan Nasution, commercial manager for South Sulawesi, West Sulawesi, SE Sulawesi office, told the news agency that they are just waiting for the arrival of lamps from Jakarta to begin distribution in May. According to the report, under the project, each of the household customers would get three light & heat energy lamps of 8 watts so that the number of customers that would get the efficient power connection facility would about 60% of the 900,000 household customers with the wattage limit of 450 VA in these regions. Mr. Nasution, the report notes, said the distribution of the LHE was expected to reduce the use of electricity at peak burdens. 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. The Troubled Company Reporter-Asia Pacific reported on June 18, 2007, that Standard & Poor's Ratings Services affirmed its 'BB-' foreign currency rating and 'BB' local currency rating on Indonesia's PT Perusahaan Listrik Negara (Persero). The outlook is stable. At the same time, Standard & Poor's assigned its 'BB-' issue rating to the proposed senior unsecured notes to be issued by PLN's wholly owned subsidiary, Majapahit Holding B.V. PERUSAHAAN NEGARA: Fitch Affirms BB- Ratings with Pos. Outlook -------------------------------------------------------------- Fitch Ratings affirmed the ratings of Indonesia-based PT Perusahaan Negara, as: -- Long-term foreign and local currency Issuer Default Ratings at 'BB-' -- PGN Euro Finance 2003 Limited's USD125 million notes due 2014 and USD150 million notes due 2013, guaranteed by PGN and its subsidiaries, at 'BB- ' -- National Long -- term rating 'AA(idn)' At the same time, Fitch has revised the Outlook for the IDRs and National Long-term ratings to Positive from Stable. The Outlook revision reflects Fitch's expectation that completion of the South Sumatera - West Java pipeline project is likely to result in higher gas distribution volumes, leading to improved revenue and leverage ratios. PGN expects to complete the final leg of the SSWJ project in October 2008. On completion of the project, total capacity of SSWJ pipeline will reach 970 million standard cubic feet per day, which will significantly boost PGN's existing gas distribution capacity. PGN's ratings are supported by its dominant position in the gas distribution and transmission businesses in Indonesia, with a market share of about 93% and 85%, respectively, at end-1H07. In its gas distribution business, PGN buys gas on long-term contracts at a fixed dollar-denominated price and sells it to numerous industrial and commercial consumers, under take-or-pay gas sales agreements. Fitch believes that gas demand in Indonesia will remain strong, supported by a shift to gas by industrial companies due to its price advantage over crude oil. PGN's current gas selling price to industrial customers is 57% and 77% cheaper than the prices of domestic subsidised high speed diesel and non-subsidised HSD, respectively. PGN's gas transmission business is managed by its 60%-owned subsidiary PT Transportasi Gas Indonesia, which owns and operates two transmission pipelines. TGI has strong counter-parties and it earns a predetermined transmission commission on the gas carried. Although PGN has long-term gas sales and supply agreements with upstream operators that mitigate supply availability, Fitch notes that securing the gas supply to meet future increases in gas demand will be a key challenge for PGN. The rating is also constrained by PGN's aggressive capital expenditure, totalling about USD268m in 2008. About 60% of this total capital expenditure is earmarked to expand transmission networks while the reminder will be used to expand distribution networks. Despite this investment, Fitch expects leverage to decrease due to the additional gas sales following the completion of SSWJ pipelines project in October 2008. Therefore, the agency also expects net debt to EBITDA is likely to decline to about 2.0x to 2.2x in 2008. The ratings may be upgraded if PGN maintains a net debt to EBITDA of less than 2.0x in 2008 and 2009. The completion of the SSWJ pipeline projects on schedule and without further significant cost overruns would also be positive for the rating. Conversely, a sustained level of net debt to EBITDA above 2.5x in 2008 and 2009 and material delays in the SSWJ project completion and/or significant project cost overruns may result in a downward revision on its Outlook. At end-1H07, PGN had total revenue of IDR3,846 billion and EBITDA of IDR1,760 billion. The Government of Indonesia (rated 'BB'/Stable) owns about 55.2% of the company as at 30 June 2007, while public shareholders as well as the company's employees and management hold a 44.2% and 0.6% stake, respectively. 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. SEMEN GRESIK: 2007 Net Profit Up 37% to IDR1.78 Trillion -------------------------------------------------------- PT Semen Gresik's 2007 net profit increased 37% to IDR1.78 trillion from IDR1.3 trillion last year, aided by stronger sales, Antara News reports citing Company President Dwi Sutjipto. According to the report, company's sales grew 10% to IDR9.6 trillion in last year from IDR8.73 trillion in 2006. Operating profit, the report notes, rose 34% to IDR2.4 trillion from IDR1.78 trillion rupiah in 2006 due to cost efficiencies. In 2007, Semen Gresik sold a total of 16.94 million tons of cement, up 1.1% from 2006, the report recounts. Domestic sales accounted for about 90 percent of the sales volume, the report adds. About Semen Gresik PT Semen Gresik Tbk is the largest cement player in Indonesia with a 46% market share. It has a total production capacity of 16.9 mtpa with facilities located in Tuban, Padang and Tonasa. As of June 2007, SGG was 51% owned by the government and 24.9% by the Rajawali Group, with the remaining shares publicly held. The Troubled Company Reporter-Asia Pacific reported on Oct. 2, 2007, that Moody's Investors Service assigned a Ba2 local currency corporate family rating to PT Semen Gresik (Persero) Tbk. At the same time, Moody's assigned the company a national scale rating of Aa2.id. The outlook for both ratings is stable. TELKOM: Alcatel-Lucent to Deploy Data Recovery Service Network -------------------------------------------------------------- PT Telekomunikasi Indonesia Tbk selected Alcatel-Lucent to deploy a national Data Recovery Service network connecting ten cities across the country. By deploying a highly resilient IP/MPLS-based network, PT Telkom ensures business continuity for its mission critical operations. PT Telkom is transforming its IT network by migrating the connectivity of its data centers to IP/MPLS to facilitate administrative operations such as centralized billing. Under the terms of the contract, Alcatel-Lucent will deploy its industry leading IP/MPLS solution based on the Alcatel-Lucent 7750 and 7710 Service Routers and the 7450 Ethernet Service Switch, giving service providers control over their network and allowing them to manage and troubleshoot simply and effectively. Once deployed, nation-wide data centers will be connected via a single, reliable Alcatel-Lucent IP/MPLS-based network allowing the service provider to more efficiently manage its network operations. "The new Alcatel-Lucent Data Recovery Service network enables us to consolidate our data centers across the entire nation over a robust, highly reliable network ensuring our mission critical operations are functioning 24 hours a day," said Rinaldi Firmansyah, PT Telkom's Chief Executive Officer. "We are building on our earlier success and experience in supporting PT Telkom's optical, microwave radio and access networks," said Frederic Rose, President of Alcatel-Lucent's activities in Europe, Africa and Asia. "PT Telkom's decision to migrate its critical operations to a highly reliable DRS network based on Alcatel-Lucent is a testament to the strength and flexibility of our IP/MPLS technology." About Alcatel - Lucent Headquartered in Paris, France, Alcatel-Lucent S.A. -- http://www.alcatel-lucent.com/-- provides solutions that enable service providers, enterprises and governments worldwide to deliver voice, data and video communication services to end users. Alcatel-Lucent maintains operations in 130 countries, including, Austria, Germany, Hungary, Italy, Netherlands, Ireland, Canada, United States, Costa Rica, Dominican Republic, El Salvador, Guatemala, Peru, Venezuela, Indonesia, Australia, Brunei and Cambodia. * * * As reported in the TCR-Europe Nov. 9, 2007, Moody's Investors Service downgraded to Ba3 from Ba2 the Corporate Family Rating of Alcatel-Lucent. The ratings for senior debt of the group were equally lowered to Ba3 from Ba2 and the trust preferred notes of Lucent Technologies Capital Trust I have been downgraded to B2 from B1. At the same time, Moody's affirmed its Not-Prime rating for short-term debt of Alcatel-Lucent. Moody's said the outlook for the ratings is stable. Alcatel-Lucent's Long-Term Corporate Credit rating and Senior Unsecured Debt carry Standard & Poor's Ratings Services' BB rating. Its Short-Term Corporate Credit rating stands at B. About PT Telkom Indonesia Based in Bandung, Indonesia, PT Telekomunikasi Indonesia Tbk -- http://www.telkom-indonesia.com/-- provides local and long distance telephone service in Indonesia. Known as Telkom, the company also offers fixed wireless service, leased lines, and data transport through affiliates. As reported in the Troubled Company Reporter-Asia Pacific on Oct. 24, 2007, that Moody's Investors Service changed the outlook on PT Telekomunikasi Indonesia's local currency corporate family rating to positive from stable. At the same time Moody's has affirmed Telkom's local currency corporate family rating at Ba1. On Sep. 12, 2007, Fitch Ratings affirmed Telekomunikasi Indonesia's Long-term foreign and local currency. ========= J A P A N ========= AMR CORP: S&P Revises Outlook to Negative on Expected Loss ---------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on the long-term ratings on AMR Corp. (B/Negative/B-3) and subsidiary American Airlines Inc. (B/Negative/--) to negative from positive. S&P also lowered its short-term rating on AMR to 'B- 3' from 'B-2' and affirmed all other ratings on AMR and American. "The outlook revision and short-term rating downgrade are based on the expected impact of much higher jet fuel prices and a weakening U.S. economy, which we believe will cause AMR to report a loss this year," said Standard & Poor's credit analyst Philip Baggaley. "AMR's earnings, cash flow, and credit protection measures are likely to be materially lower in 2008 than last year, though the company continues to have adequate liquidity and projects $4.4 billion of unrestricted cash and short-term investments at March 31, 2008," the credit analyst continued. Ratings on Fort Worth, Texas-based AMR and subsidiary American Airlines reflect participation in the competitive, cyclical, and capital-intensive airline industry; a heavy debt and pension burden; and substantial capital spending needs to modernize the airline's fleet. Satisfactory liquidity, with US$4.5 billion of unrestricted cash and short-term investments at Dec. 31, 2007, and substantial market positions in the U.S. domestic, trans- Atlantic, and Latin American markets (though a minimal presence in the Pacific) are positives. American, like other large U.S. airlines, reported much improved earnings in 2006 and 2007, benefiting from cost-cutting and a more favorable balance of supply and demand, particularly on international routes. Fully adjusted EBITDA interest coverage improved to 2.0x and funds flow to debt to 11%, compared with 1.8x and 8% in 2006. However, the recent surge in fuel prices and rapidly weakening U.S. economy (which Standard & Poor's economists believe is already in a recession) are likely to result in materially worse results in 2008. If crude oil averages about US$97 per barrel, as S&P currently forecasts, and further fare increases become progressively more difficult to achieve because of the weak economy, AMR could lose more than US$1 billion this year. AMR currently has adequate liquidity, with unrestricted cash and short-term investments of US$4.5 billion (none of which is invested in auction-rate securities) at Dec. 31, 2007, and US$4.4 billion forecast (by the company) for March 31, 2008. American has access to an undrawn US$255 million revolving credit that matures June 17, 2009, part of a credit facility that includes also a US$440 million term loan due June 17, 2010. Key financial covenants under that facility include a quarterly cash flow coverage test (AMR consolidated EBITDAR divided by interest and rentals, on a 12-month rolling basis), of 1.4 to 1, stepping up to 1.5 to 1 in the second quarter of 2009. S&P estimates that a pretax loss that exceeds about US$450 million to US$500 million would trip the coverage covenant. Accordingly, if high fuel prices persist, the company may seek to amend or obtain a waiver of that covenant. Alternatively, American could borrow against unencumbered aircraft or use cash to pay down the remaining US$440 million term loan. Very high fuel prices and a weak economy could cause material losses and a potential covenant problem this year. S&P could lower ratings if it appears that a deep or prolonged downturn will erode liquidity or the company's financial profile. Headquartered in Forth Worth, Texas, AMR Corporation (NYSE: AMR) operates with its principal subsidiary, American Airlines Inc. -- http://www.aa.com/-- a worldwide scheduled passenger airline. At the end of 2006, American provided scheduled jet service to about 150 destinations throughout North America, the Caribbean, Latin America, including Brazil, Europe and Asia. American is also a scheduled airfreight carrier, providing freight and mail services to shippers throughout its system. Its wholly owned subsidiary, AMR Eagle Holding Corp., owns two regional airlines, American Eagle Airlines Inc. and Executive Airlines Inc., and does business as "American Eagle." American Beacon Advisors Inc., a wholly owned subsidiary of AMR, is responsible for the investment and oversight of assets of AMR's U.S. employee benefit plans, as well as AMR's short-term investments. JAPAN AIRLINES: Studies Safety Measures Along With Trade Unions --------------------------------------------------------------- Japan Airlines International Co., Ltd. has started jointly studying safety measures with its four unions after problems involving its flights, Kyodo News reports. According to Kyodo News, JAL and the trade unions have set up a flight safety working group to determine the causes of the incidents and to develop preventive measures. Kyodo News notes that this is the first time the management and the unions, which often conflict over wages and working conditions, agree to carry out a joint study of safety measures. About Japan Airlines Tokyo-based Japan Airlines International Company, Limited -- http://www.jal.com/en/-- was created as a result of the merger of Japan Airlines and Japan Air Systems to boost domestic coverage. Japan Airlines flies to the United States, Brazil and France. * * * As reported on Feb. 9, 2007, that Standard & Poor's Ratings Services affirmed its 'B+' long-term corporate credit and issue ratings on Japan Airlines Corp. (B+/Negative/--) following the company's announcement of its new medium-term management plan. S&P said the outlook on the long-term corporate credit rating is negative. As reported on Oct. 10, 2006, that Moody's Investors Service affirmed its Ba3 long-term debt ratings and issuer ratings for both Japan Airlines International Co., Ltd and Japan Airlines Domestic Co., Ltd. Fitch Ratings Tokyo analyst Satoru Aoyama said that the company's debt obligations and expenses for new aircraft have placed it in an unfavorable financial position. Fitch assigned a BB- rating on the company, which is three notches lower than investment grade. SAPPORO HOLDINGS: Counts on Shareholders to Retain Measures ----------------------------------------------------------- Sapporo Holdings Ltd. may have to rely on its non-foreign shareholders to support the maintenance of its takeover defense measures as Steel Partners Japan Strategic Fund LP, along with other foreign institutional investors hold a total of 36.1% in the company as of the end of December, Jiji Press reports. Sapporo, which aims to gain approval at a shareholders' meeting on March 28 to maintain its takeover defense measures, may possibly be in trouble because the foreign institutional ownership increased 6.1 points from the previous year, relates Jiji Press. Jiji Press recounts that at a shareholder's meeting last year, more than two-thirds of shareholders, approved the takeover defense, while Steel Partners and other foreign shareholders are believed to have opposed the move. According to Jiji Press' sources, the proposal is likely to be approved, but the share of shareholders supporting the plan may drop to as low as 55%, based on the assumption that slightly over 81% of shareholders exercise their voting rights, as they did last year. About Sapporo Holdings Sapporo Holdings Limited -- http://www.sapporoholdings.jp/ -- formerly known as Sapporo Breweries, brews beer and operates more than 200 beer halls and restaurants. Sapporo is one of Japan's oldest brewers, and is Japan's third largest brewing company, with brews ranging from its flagship Black Label to the pricier Yebisu. Sapporo also makes the low-malt happoshu brew. The company sells Guinness beer in Japan through its Sapporo Guinness Company and owns a beverage company that makes canned coffee, bottled water, and soft drinks. * * * As of May 16, 2007, the company carries Standard & Poor's Rating Service's 'BB' Long-Term Foreign Issuer Credit and Long-Term Local Issuer Credit Ratings that were issued on Feb. 6, 2006; and Fitch Ratings' 'B' Short-term Foreign and Local Currency Issuer Default Ratings that were issued on March 14, 2006. * Fitch Says FIEA Restrictions on Real Estate Won't Affect CMBS --------------------------------------------------------------- Fitch Ratings said that the legal procedures and restrictions imposed by the Financial Instruments and Exchange Act on the businesses of real estate asset management companies are not expected to have a significant impact on the ratings of CMBS. Following the enforcement of FIEA, trust beneficiary interests backed by real estate, property TBIs, are considered "deemed securities". As a result, management activities, such as the acquisition and sale of property TBIs, using investors' funds, are regarded as a type of "financial instruments business", and each AM is required to obtain appropriate registration under FIEA and operate in accordance with the law. Companies operating applicable businesses prior to the enforcement of FIEA must apply for registration by 30 March 2008. As real estate AMs are typically entrusted by investors to manage fund assets, many of them are expected to obtain registration as an "investment management firm" in order to manage discretional security investments. On the other hand, some companies have opted to be registered as an "investment advisory/agency firm" which is then expected to only give advice. The Financial Services Agency has published on its website the names of companies registered as a "financial instruments firm" as of 29 February 2008. When registering as an investment management firm that invests in property TBIs etc., applicants are required to be registered as a "comprehensive real estate investment advisory firm" with the Ministry of Land, Infrastructure, Transport and Tourism, in order to be permitted to manage discretional property investments. This partly explains why the MLIT has received increased enquiries related to FIEA. Likewise, enquiries to other relevant regional financial bureaus have also increased. When rating CMBS, Fitch focuses on the value of the properties and the structure of the loan claims that will ultimately secure the CMBS. In its analysis, the agency factors in a scenario where the AM's business may, in the event of increasing deterioration of its credit or management capability, be taken over by a new AM. The agency also takes into account the possibility of loan claims being collected by a servicer in the event of default. Based on the above, even if non-compliance with FIEA is subsequently discovered in some AMs, Fitch expects the impact on CMBS ratings to be limited. However, given the importance of the appropriate actions taken by AMs in response to FIEA for the stability of real estate securitisation schemes as well as for CMBS ratings, Fitch considers it appropriate to include AM's non-compliance with FIEA as an asset manager termination event in CMBS documentation. Fitch will review, as appropriate, if AMs involved in CMBS transactions have obtained registrations required under FIEA. The agency will also monitor the compliance status of each AM under the newly imposed regulation. ========= K O R E A ========= ILSUNG CONSTRUCTION: Appoints Won Hyeon Su as CEO ------------------------------------------------- Ilsung Construction Co., Ltd. has appointed Won Hyeon Su as its new Chief Executive Officer replacing Sohng Sang Yoon, Reuters Investing Keys reports. According to the report, Mr. Su's appointment took effect on March 21, 2008. Seoul, Korea-based Ilsung Construction Co., Ltd. -- http://www.ilsungconst.co.kr/-- specializes in the provision of construction and engineering services. The Company has five major divisions: Construction division, which constructs buildings, high-speed railways and condominiums; Engineering Works division, which builds highways, subways, tunnels, bridges and housing developments; Social Overhead Capital (SOC) division, which collects toll fees to recoup its investment in the construction of tunnels, environment and energy plants; Housing division, which constructs apartment, mansions and villas, and Gardening division, which constructs golf clubs, parks and landscape architecture. Korea Ratings gave the company's commercial papers a B+ rating on January 31, 2007. KENERTEC CO: Signs KRW2.15BB Contract With Korea-Based Apartment ---------------------------------------------------------------- Kenertec Co., Ltd. has signed a KRW2.15-billion contract with an apartment, which is in Daejeon Metropolitan City, Reuters Investing Keys reports. Under the business agreement, the report notes, the company will provide energy economy services to the apartment. Headquartered in Gyeongsangbuk Province, Korea, Kenertec Co., Ltd. -- http://www.kenertec.co.kr/-- is provides industrial burners and energy-related equipment. The company operates two main divisions: Furnace division, which provides regenerative combustion systems, including regenerative combustion industrial furnace burners, regenerative combustion radiant tube burners, regenerative combustion raddle burners, radiant combustion devices, direct heat-treatment b