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 Friday, April 25, 2008, Vol. 11, No. 82 Headlines A U S T R A L I A SHARPER IMAGE: American Express Wants to End Rewards Promo SHARPER IMAGE: Mcauley Seeks US$279,683 for Goods & Services SHARPER IMAGE: Seeks to Employ RCR Real Estate Advisors SHARPER IMAGE: Court Approves Womble Carlyle as Counsel ZINIFEX LTD: Zinc Production Up to 146,278 Tonnes for Third Qtr. C H I N A & H O N G K O N G & T A I W A N ASAT HOLDINGS: Stock Now Trading Over-The-Counter ASAT HOLDINGS: Names Jeffrey R. Osmun as President BANK OF SHANGHAI: To Offer More Loans to Small Enterprises CHINA EASTERN: Borrows $337 Million For New Airplanes CHINA FISHERY: Unit to Buy Epesca Pisco for US$19.9 Million CHINA FISHERY: Dividend Payment Date Not Yet Scheduled CITIC PACIFIC: To Pay Dividend of HK$0.80 Per Share EMI GROUP: Restructuring Continues Despite Contractual Hurdles EVERBRIGHT BIOPHARMACEUTICAL: Places 12 Million New Shares EVERBRIGHT BIOPHARMA: Annual Report Posting Moved to May 15 FIAT SPA: Shows Interest in Acquiring Serb Car Maker Zastava JIANGXI COPPER: First-Quarter Net Profit Up 46.42% to CNY1.26BB LAND BANK: S&P Holds C+ Bank Fundamental Strength Rating PETROLEOS DE VENEZUELA: Gov't Approves Oil Sudden-Gains Tax WAN HAI LINES: S&P Cuts Rating on Unit's Corporate Bonds to BB+ YRC WORLDWIDE: Renews Asset-Backed Securitization Facility YRC WORLDWIDE: Agrees to Amendments on Aug. 17 Credit Agreement YRC WORLDWIDE: Fitch Holds 'BB+' ID Rating on Facility Amendment YRC WORLDWIDE: Moody's Cuts CF Rating to Ba2 I N D I A GERDAU SA: To Invest US$180 Million in CCA Tie-Up GERDAU SA: Quanex Shareholders Okay US$1.67 Billion Purchase GMAC LLC: Moody's Downgrades Senior Rating to B2 PRIDE INTERNATIONAL: Board Drops Ownership Threshold to 10% TATA MOTORS: U.S. Antitrust Okays Jaguar and Land Rover Purchase TATA STEEL: S&P Affirms BB Corp. Credit Rating; Revises Outlook I N D O N E S I A FREEPORT-MCMORAN: Reports US$1.1 Billion Net Income in 1Q 2008 J A P A N ALITALIA SPA: To Receive EUR300-Million Bridging Loan from Italy ELPIDA MEMORY: Poor Performance Cues Execs Salary Cuts SHOKO CHUKIN BANK: Conversion Doesn't Change Moody's BFSR at D K O R E A DIOMED HOLDINGS: Trustee Appoints 5-Member Creditors' Committee DIOMED: Wants to Hire McGuireWoods as Bankruptcy Counsel HYNIX SEMICONDUCTOR: Won't Buy Stake in Germany's Qimonda HYUNDAI MOTOR: Records 28% Increase in First-Quarter Net Profit TERADYNE INC: Earns US$21.8 Million in First Quarter 2008 M A L A Y S I A GOLD BRIDGE: Securities to be Listed Again in Bursa HARVEST COURT: Taps Chua Eng Chin as Audit Committee Chairman N E W Z E A L A N D AIR NEW ZEALAND: Moody's Affirms Ba1 Rating; Outlook Positive ALCATEL-LUCENT SA: Rebecca Hick to Lead New Zealand Channel Unit CHAMBERLAIN PARK PROPERTY: Creditors Must File Claims by May 4 D N BECKETT LIMITED: High Court Appoints Liquidators DON LAW REALTY: Shareholder Resolves to Liquidate Firm DONCASTER PROPERTY: Creditors Must File Claims by April 30 FRESH & FROZEN FOOD: Shareholders Appoint Liquidators HAWKES BAY: Shareholders Appoint Liquidator INTEGRITY REAL ESTATE: High Court Appoints Liquidators JOHNSONVILLE MOTELS: Commences Liquidation Proceedings JUST INTEGRITY 2000 LIMITED: High Court Appoints Liquidators KINLEITH LOG STACKERS: Creditors Must File Claims by May 7 MANABARS TECHNOLOGIES LIMITED: High Court Appoints Liquidators MATECO NZ: Commences Liquidation Proceedings NIGEL MILLAR MACHINERY: Court Appoints Joint Liquidators RITCHIE ENTERPRISES: Creditors Must File Claims by May 6 S & P TECHNOLOGIES: Creditors Must File Claims by May 5 SHELDRAKE LTD: Court to Hear Wind-Up Petition on June 6 STORE TRADING: Court to Hear Wind-Up Petition on June 6 THE HIGHWAY VILLAGE: A. V. Stephenson Appointed as Liquidator TMP QUALITY FIXING: Court Replaces Liquidators TOTAL FOOD SERVICES: Shareholders Appoint Liquidators XJL CARTAGE: Joint Liquidators Appointed P H I L I P P I N E S NIHAO MINERAL: Posts Php14.52 Million Net Loss for FY 2007 PLDT: Year 2007 Net Income Up by 21% to PHP39,274 Million PLDT: Schedules 1st Qtr Results Teleconference on May 6 SBARRO INC: Earns US$5.1 Million in Fourth Quarter Ended Dec. 30 S I N G A P O R E FRANKEL LEASING: Wind-Up Petition Hearing Set Today FUTURESTEEL ENGINEERING: Court Enters Wind-Up Order JURONG GARDENS: Requires Creditors to File Claims by May 5 SPENCER HOUSE: Creditors' Proofs of Debt Due on May 7 S R I L A N K A SANASA DEVELOPMENT: Fitch Lifts Nat'l. Long-term Rating to 'BB' T H A I L A N D FEDERAL-MOGUL: Asbestos Trust Wants Pneumo Claims Holders Barred GLOBAL TRADER: Administrator Launches Probe Into Affairs X X X X X X X X * Beard Group to Hold 1st Annual Healthcare Conference on May 30 * Large Companies with Insolvent Balance Sheets - - - - - ================= A U S T R A L I A ================= SHARPER IMAGE: American Express Wants to End Rewards Promo ---------------------------------------------------------- American Express Travel Related Services Company Inc. asks the U.S. Bankruptcy Court for the District of Delaware to lift the automatic stay to allow it to terminate its Rewards Participant Agreement with Sharper Image Corporation. William J. Burnett, Esq., at Flaster/Greenberg P.C., in Wilmington, Delaware, relates that on January 1, 2001, the Debtor and American Express entered into the Reward Participant Agreement wherein: (i) American Express will promote Rewards provided by the Debtor to all its Cardmembers, which Rewards include US$25 Gift/Rewards and US$50 Gift/Rewards for the Debtor; (ii) the Debtor is required to disclose any material restrictions on the ability of the Cardmembers to use or redeem the Rewards; and (iii) the Debtor cannot impose restrictions on the Rewards that were not originally set in the Agreement. Mr. Burnett explains that in the Debtor's request to Honor Prepetition Customer Programs, the Debtor made clear that it will not honor the Reward Participant Agreement including the Gift Cards provided to American Express under the Agreement. On a Court-approved Supplemental Motion, the Debtor was granted authorization to honor the Gift Certificates provided that a customer purchases goods that are worth at least 200% of the amount of the Gift Certificate. Mr. Burnett argues that the Debtor's imposition of a new restriction, that is strictly forbidden, constitutes a material breach of the Reward Participant Agreement and precluded the ability of the American Express customers to redeem the designated Rewards. According to Mr. Burnett, American Express believes that the Debtor's actions are imposing new burdens on American Express customers, which in turn will likely tarnish the positive goodwill of American Express brand associated with its customers participating in the Program and the overall value of the Rewards. "American Express will face significant pressures as its customers seek reimbursement for Gift Cards that are worth less than they bargained for," Mr. Burnett discloses. American Express, hence, wants the Court to modify the automatic stay to allow it to (i) exercise its contractual right to terminate the Rewards Participating Agreement 30 days starting March 26, 2008; or (ii) provide the Debtor with notice that American Express will exercise its option to allow the Rewards Participant Agreement to expire on June 30, 2008. Furthermore, American Express asks the Court to authorize the Debtor to file the Agreement under seal, and to direct that the Agreement will remain under seal, confidential and not be made available to anyone, except to counsel for the Debtor or others upon further order of the Bankruptcy Court. Mr. Burnett notes that the terms of the Agreement include confidential pricing information and reveal confidential detail of the relationship between American Express and its Rewards Program Participants. About Sharper Image Based in San Francisco, California, Sharper Image Corp. -- http://www.sharperimage.com/-- is a multi-channel specialty retailer. It operates in three principal selling channels: the Sharper Image specialty stores throughout the U.S., the Sharper Image catalog and the Internet. The company has operations in Australia, Brazil and Mexico. In addition, through its Brand Licensing Division, it is also licensing the Sharper Image brand to select third parties to allow them to sell Sharper Image branded products in other channels of distribution. The company filed for Chapter 11 protection on Feb. 19, 2008 (Bankr. D. Del., Case No. 08-10322). Steven K. Kortanek, Esq. At Womble, Carlyle, Sandridge & Rice, P.L.L.C. represents the Debtor in its restructuring efforts. An Official Committee of UnsecuredCreditors has been appointed in the case. When the Debtor filed for bankruptcy, it listed total assets of US$251,500,000 and total debts of US$199,000,000. (Sharper Image Bankruptcy News, Issue No. 8; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). SHARPER IMAGE: Mcauley Seeks US$279,683 for Goods & Services ------------------------------------------------------------ Edwin McAuley Electronics (HK) Limited asks the U.S. Bankruptcy Court for the District of Delaware to allow it to exercise its rights to reclaim all unpaid products and goods received by Sharper Image Corp. within 45 days of the bankruptcy filing, pursuant to Uniform Commercial Code Section 2-702, other relevant statutes as enacted in all relevant jurisdictions, and Section 546(c) of the Bankruptcy Code. Edwin McAuley's records reflect 12 unpaid delivery invoices totaling US$278,923 and four rechargeable service invoices totaling US$759 that are the subject of the reclamation demand. Pursuant to Section 503(b)(9) of the Bankruptcy Code, Edwin McAuley asks the Court to allow its US$279,683 claim for goods and services delivered to the Debtor during the 20 days prior to the Petition Date, as an administrative expense claim. About Sharper Image Based in San Francisco, California, Sharper Image Corp. -- http://www.sharperimage.com/-- is a multi-channel specialty retailer. It operates in three principal selling channels: the Sharper Image specialty stores throughout the U.S., the Sharper Image catalog and the Internet. The company has operations in Australia, Brazil and Mexico. In addition, through its Brand Licensing Division, it is also licensing the Sharper Image brand to select third parties to allow them to sell Sharper Image branded products in other channels of distribution. The company filed for Chapter 11 protection on Feb. 19, 2008 (Bankr. D. Del., Case No. 08-10322). Steven K. Kortanek, Esq. At Womble, Carlyle, Sandridge & Rice, P.L.L.C. represents the Debtor in its restructuring efforts. An Official Committee of UnsecuredCreditors has been appointed in the case. When the Debtor filed for bankruptcy, it listed total assets of US$251,500,000 and total debts of US$199,000,000. (Sharper Image Bankruptcy News, Issue No. 8; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). SHARPER IMAGE: Seeks to Employ RCR Real Estate Advisors ------------------------------------------------------- Sharper Image Corporation has determined that it requires the assistance of an experienced real estate consultant in addressing a variety of real estate issues that are sure to arise in its bankruptcy case, like analysis, assessment, marketing and disposition of its leased and owned properties, Steven K. Kortanek, Esq., at Womble Carlyle Sandridge & Rice, PLLC, in Wilmington, Delaware, says. Accordingly, the Debtor asks the U.S. Bankruptcy Court for the District of Delaware for permission to hire RCS Real Estate Advisors as its exclusive real estate consultant in its Chapter 11 case. The Debtor's primary purpose of employing RCS is to get RCS' assistance in assessing its properties in a way that maximizes value. Before the Petition Date, RCS had been engaged by the Debtor to conduct value analysis on its array of leases, and RCS has since been valuing the Debtor's own property in Arkansas. RCS' close coordination with the Sharper Image's management has made it well acquainted with the Debtor's businesses and property, Mr Kortanek explains. It is for these reasons and for the best interest of Sharper Image, its property, its creditors and all other interested parties, that it wisher to employ RCS. As real estate consultant, RCS will: (1) analyze all real estate assets owned by the Debtor and to conduct a review of the occupancy cost of each in relation to sales, volume and profitability. RSC is bound to discuss its findings and recommendations with Sharper Image after the review; (2) create a portfolio book for the Debtor's leases, indicating the current lease terms, sales, profits, occupancy cost and the store's contribution in relation to sales; (3) create a site ranking report by contribution, revenues, occupancy costs, for all or selected leases; (4) perform a rejection claim analysis on all or selected leases; (5) assist the Debtor in developing real estate goals -- the Real Estate Action Plan -- to determine which stores to close, renegotiate or retain under renegotiated terms, and existing stores to go forward with; (6) negotiate with landlords for the reduction of rents, for the modification or extension of terms for all or certain leases; (7) work with landlords and the Debtor for the accurate documentation of all lease modification proposals; to provide accurate and timely status reports regarding the status of these proposals; (8) attend in all court hearings, to meet with the Statutory Creditors' Committee and to meet with Sharper Image and its counsel; (9) coordinate with the Debtor, its counsel and affected landlords on all real estate matters particularly the status and on going changes of the Real Estate Action Plan; (10) perform desktop leasehold valuations for certain assets, to negotiate waivers, payout terms for prepetition cure amounts due to landlords in the case of lease assumptions, and conduct negotiations with respect to mitigating allowed rejection claims in the case of lease rejections; and (11) dispose all properties of the Debtor, by sale or otherwise, on the Debtor's terms and conditions, and subject to its sole authority and discretion by: -- reviewing all documents, -- marketing the Disposition Properties pursuant to a marketing program and budget, -- communicating with parties interested in the Disposition Property, -- responding, informing and negotiating with prospective buyers, and making recommendations to the Debtor, -- providing guidance to Sharper Image on methods to resolve issues that pertain to Disposition properties, -- working closely with the Debtor's counsel with regards to the hearing or auction, to obtain the attendance of all the interested parties through direct communications, supplementing the required notice process, -- working with the attorneys responsible for the implementation of the proposed transaction, reviewing documents, negotiating and assisting in resolving problems which may arise, and -- to appear in court during the term of retention, to testify or consult with the Debtor in matters involving the marketing or disposition of a Disposition Property. Inasmuch as RCS is employed by Sharper Image to perform highly specialized tasks, its compensation is result-oriented and directly related to the benefits received by the Debtor's estate in every transaction, requiring RCS to file periodic fee applications pursuant to Sections 330 and 331 of the Bankruptcy Code and in compliance with Rule 2016 of the Federal Rules of Bankruptcy Procedure, Mr. Kortanek says. RCS will be compensated on a per transaction basis based on a fee structure set forth in the parties' Retention Agreement. A copy of the Retention Agreement was not available as of press time. Given the transactional nature of RCS's engagement and the flat fee, percentage-based fee structure, the Debtor submits that recording and submission of detailed time entries for services rendered in this case is unnecessary and would be unduly burdensome to RCS. RCS will, however, file a final fee application in accordance with applicable Bankruptcy Rules and Local Rules. Ivan L. Friedman, president and chief executive officer of RCS, assures the Court that RCS is a "disinterested person," as that term is defined in the Bankruptcy Code and holds no interest adverse to Sharper Image and its estate. About Sharper Image Based in San Francisco, California, Sharper Image Corp. -- http://www.sharperimage.com/-- is a multi-channel specialty retailer. It operates in three principal selling channels: the Sharper Image specialty stores throughout the U.S., the Sharper Image catalog and the Internet. The company has operations in Australia, Brazil and Mexico. In addition, through its Brand Licensing Division, it is also licensing the Sharper Image brand to select third parties to allow them to sell Sharper Image branded products in other channels of distribution. The company filed for Chapter 11 protection on Feb. 19, 2008 (Bankr. D. Del., Case No. 08-10322). Steven K. Kortanek, Esq. At Womble, Carlyle, Sandridge & Rice, P.L.L.C. represents the Debtor in its restructuring efforts. An Official Committee of UnsecuredCreditors has been appointed in the case. When the Debtor filed for bankruptcy, it listed total assets of US$251,500,000 and total debts of US$199,000,000. (Sharper Image Bankruptcy News, Issue No. 8; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). SHARPER IMAGE: Court Approves Womble Carlyle as Counsel ------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware authorized Sharper Image Corp. to employ Womble Carlyle Sandridge & Rice, PLLC as its counsel, effective as of the Debtor's bankruptcy filing. However, absent further Court order, the retainer to be held by Womble Carlyle as security until the firm files its final fee application will only be applied to costs and expenses incurred in connection with the Chapter 11 case, Judge Kevin Gross said. Steven K. Kortanek, Esq., at Womble Carlyle Sandridge & Rice, PLLC, in in Wilmington, Delaware, discloses that his firm does not maintain a separate firm policy or practice in making conflict-related determinations. Mr. Kortanek states that as a general philosophy, Womble Carlyle refrains from suing other professionals without the firm management's prior approval. The firm's position in this regard only addresses direct lawsuits, and does not prevent the firm from otherwise taking a position adverse to any professional in the Debtor's case or in any related proceeding, he says. As reported by the Troubled Company Reporter on March 10, in its motion to employ the firm, it is stated that in exchange for the contemplated legal services, Womble Carlyle will be paid based on its applicable hourly rates: Professional Hourly Rate ------------ ----------- Attorney US$120 to US$750 Paraprofessionals US$30 to US$450 Rebecca L. Roedell, executive vice president and chief financial officer of Sharper Image, stated that Womble Carlyle received a US$40,000 retainer from the Debtor as security for payment of the firm's fees and expenses for professional services to be performed relating to the preparation for and prosecution of the Chapter 11 case. Prior to the Petition Date, Womble Carlyle incurred a total of US$19,341 in fees and expenses which was paid prepetition from the Retainer. About Sharper Image Based in San Francisco, California, Sharper Image Corp. -- http://www.sharperimage.com/-- is a multi-channel specialty retailer. It operates in three principal selling channels: the Sharper Image specialty stores throughout the U.S., the Sharper Image catalog and the Internet. The company has operations in Australia, Brazil and Mexico. In addition, through its Brand Licensing Division, it is also licensing the Sharper Image brand to select third parties to allow them to sell Sharper Image branded products in other channels of distribution. The company filed for Chapter 11 protection on Feb. 19, 2008 (Bankr. D. Del., Case No. 08-10322). Steven K. Kortanek, Esq. At Womble, Carlyle, Sandridge & Rice, P.L.L.C. represents the Debtor in its restructuring efforts. An Official Committee of UnsecuredCreditors has been appointed in the case. When the Debtor filed for bankruptcy, it listed total assets of US$251,500,000 and total debts of US$199,000,000. (Sharper Image Bankruptcy News, Issue No. 8; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). ZINIFEX LTD: Zinc Production Up to 146,278 Tonnes for Third Qtr. ---------------------------------------------------------------- Zinifex Ltd.'s total zinc in concentration production for the quarter ended March 31, 2008 went up to 146,278 tonnes from 142,525 tonnes in the same period last year. Lead in concentrate production was down 14% to 12,974 tonnes from 15,070 tonnes in the previous year. Zinc prices have averaged US$2,774 per tonne this financial year to date, 24% lower than for the corresponding period last year. Market concerns over a large forecast zinc surplus, which has yet to appear, has been putting zinc prices under pressure. In addition the ongoing weakening of the US dollar is also impacting revenue. Lead prices strengthened at the end of the quarter, although they remain below the record highs experienced in the June 2007 Quarter. Year to date prices have averaged US$3,099 per tonne, 50% higher than the corresponding period last year, due to low stocks and ongoing concerns on reliability of supply. A major step in the strategy to grow Zinifex�s mining business was announced in March with our agreement to merge with Oxiana to create a new major diversified base and precious metals mining company. The merged business will have exceptional strength to add further shareholder value by capturing the growth in global demand for metals generated by China. The merger will be by way of a Zinifex Scheme of Arrangement in which Zinifex shareholders will receive 3.1931 Oxiana shares for each Zinifex share they own. The terms reflect a merger of equals with the merged entity to be owned 50% by Oxiana and Zinifex shareholders, respectively. Zinifex plans to dispatch a Scheme Booklet to shareholders in mid May to inform them of the merger process in preparation for a General Meeting that is currently proposed for June 16, 2008 at which they will be requested to vote on the Scheme. Directors of both companies are strongly supportive of the proposed merger. Zinifex�s offer for Allegiance Mining also reached a milestone on March 17, as it took a controlling interest in the company. Immediately following, the Board of Allegiance was reconstituted with the appointment of three Zinifex representatives and resignations of three former Allegiance directors. An interim Chief Executive Officer, Bruce McGowan, was also appointed. Work continues at Allegiance�s Avebury nickel project with pre-production testing to commence in May and wet commissioning of the concentrator throughout June. Production and ramp up to full capacity will occur across the September 2008 Quarter. The acquisition of Allegiance is an important step in Zinifex�s strategy of diversifying its exposure to high margin metals and expandable mines. It is also a perfect fit with the merged Zinifex and Oxiana making the combined entity the world�s second largest producer of zinc and a substantial producer of copper, nickel, lead, gold and silver. Zinifex's Century regional exploration program returned significant results at the Silver King Extension, the company's first prospect on its mine lease, with intersections of lead, zinc and silver. A second prospect has now opened at Watsons Lode, south of the mine lease, and drilling is in progress intersecting 5.5 metres of massive sulphides. Project Horizons drilling continues at our Rosebery Mine with an increase in resource expected when we report in June. Nearly 8,000 metres were drilled at Dugald River with an updated resource expected next quarter. Abour Zinifex Ltd. Zinifex Limited, one of the world's largest integrated zinc and lead companies -- http://www.zinifex.com/-- is headquartered in Melbourne, Australia. The company owns and operates two mines and four smelters. The mines and two of the smelters are located in Australia and supply the growing industrial markets of the Asian-Pacific region, including China. The company also has a zinc smelter in the Netherlands and the United States. The company sells a range of zinc metal, lead metal, and associated alloys in 20 countries. More than 80% of the company's products are distributed outside Australia, particularly in Asia, which is experiencing significant growth in construction activity and vehicle production. Zinc is used for steel galvanizing and die-casting and lead for lead acid batteries used mainly in cars and other vehicles. * * * The Troubled Company Reporter-Asia Pacific reported on Dec. 18, 2007, that Fitch Ratings affirmed Zinifex Limited's 'BB+' long-term foreign currency Issuer Default Rating (IDR), following the announcement of an all cash offer for Allegiance Mining NL (Allegiance). Fitch's Web site as of April 21, 2008, says the rating outlook is positive. ================================================== C H I N A & H O N G K O N G & T A I W A N ================================================== ASAT HOLDINGS: Stock Now Trading Over-The-Counter ------------------------------------------------- ASAT Holdings Limited's American Depositary Shares are now trading on the OTC Bulletin Board under the symbol "ASTTY.OB.� The OTC Bulletin Board is a quotation service that displays real-time quotes, last-sale prices and volume information in over-the-counter securities. The Financial Industry Regulatory Authority (FINRA), a self-regulatory organization of the securities industry, oversees the OTC Bulletin Board. Headquartered in Pleasanton, California, ASAT Holdings Limited (Nasdaq: ASTT) -- http://www.asat.com/-- provides semiconductor package design, assembly and test services. With 19 years of experience, the company offers a definitive selection of semiconductor packages and manufacturing lines. ASAT�s advanced package portfolio includes standard and high thermal performance ball grid arrays, leadless plastic chip carriers, thin array plastic packages, system-in-package and flip chip. ASAT was the first company to develop moisture sensitive level one capability on standard leaded products. The company has operations in the United States, Hong Kong, China and Germany. * * * Standard & Poor's placed ASAT Holdings Limited's long term foreign and local issuer credit ratings at 'CCC-' in September 2007. The outlook is negative. ASAT HOLDINGS: Names Jeffrey R. Osmun as President -------------------------------------------------- ASAT Holdings Limited appointed Jeffrey R. Osmun as company president effective April 14, 2008. Mr. Osmun will also assume the title of Executive Vice President of Sales and Marketing where he will have overall responsibility for ASAT's worldwide sales organization. Mr. Osmun will be based in the United States and report to Tung Lok Li, ASAT's acting chief executive officer. The company also said that Joe Martin, former executive vice President of sales and marketing, will assume the new position of Chief Business Officer where he will formulate and implement business strategy for the Company. Mr. Martin will continue to report directly to Mr. Li and remain a member of the Board of Directors. Mr. Osmun brings to ASAT almost 20 years of semiconductor industry sales experience, including seven years at assembly and test provider STATS ChipPAC where he most recently served as corporate vice president of Worldwide Sales and Marketing. During this period, Mr. Osmun served as a key member of the leadership team responsible for the integration of ST Assembly Test Services Ltd. and ChipPAC in 2004, while at the same time leading the combined marketing, customer service and technical sales support organizations. "Jeff brings a proven record of success in managing global sales organizations in the semiconductor and assembly and test industries. I am pleased that a person of his caliber has agreed to join our executive team charged with leading the next phase of ASAT's growth,"said Mr. Li. In addition to his experience at STATS ChipPAC, Mr. Osmun most recently served as Corporate Vice President of Sales and Marketing at White Electronic Designs, an Arizona-based provider of advanced technology solutions. Mr. Osmun also worked in several sales and management positions, rising from sales engineer to national sales manager, during his 12 year career with Kyocera America, Inc. "ASAT is rebuilding a prominent position in the outsourced assembly and test industry by leveraging its expanding customer base, world-class customer service, leading-edge product platform and state-of-the-art manufacturing center in Dongguan,"said Mr. Osmun. "In the last year the company has delivered on its strategy to generate improved results and I look forward to contributing to its future success.� Mr. Osmun holds a Bachelor of Science degree in Mechanical Engineering from Lehigh University. About ASAT Holdings Limited Headquartered in Pleasanton, California, ASAT Holdings Limited (Nasdaq: ASTT) -- http://www.asat.com/-- provides semiconductor package design, assembly and test services. With 19 years of experience, the company offers a definitive selection of semiconductor packages and manufacturing lines. ASAT�s advanced package portfolio includes standard and high thermal performance ball grid arrays, leadless plastic chip carriers, thin array plastic packages, system-in-package and flip chip. ASAT was the first company to develop moisture sensitive level one capability on standard leaded products. The company has operations in the United States, Hong Kong, China and Germany. * * * Standard & Poor's placed ASAT Holdings Limited's long term foreign and local issuer credit ratings at 'CCC-' in September 2007. The outlook is negative. BANK OF SHANGHAI: To Offer More Loans to Small Enterprises ---------------------------------------------------------- Bank of Shanghai plans to provide better financial services for local small enterprises in the future, SinoCast News reports, citing assistant to president He Qing. Mr. Qing told the news agency that in spite of the nation's tightening monetary policy, the bank still aim to prioritize the small enterprises' borrowing demands. Loans to small enterprises this year are predicted to leap 67%, five times the bank's total lending growth, the report notes. According to the report, loans offered to small enterprises make up about 10% of the bank's total corporate lending, which is expected to double within three years. Moreover, the same report relates, to encourage loans to small enterprises, the bank has included in its achievement appraisal for sub-branches certain targets on loans to be offered to small enterprises. Shanghai bank also adjusted its business structure, SinoCast says. In November 2007, it established an investment banking division to provide services, like venture capital, private equity investment, merger and acquisition, and domestic and overseas listing, for well- performing small enterprises, the report adds. The bank, Sinocast says, plans to conduct an investigation to its nearly 10,000 small enterprises customers in the city first and then make contact with venture capital firms and private equity firms at home and abroad. About Bank of Shanghai As a joint-stock commercial bank set up on Dec. 29, 1995, the Bank of Shanghai features a two-level operating structure within one legal entity, with the paid-up capital booked at RMB2.6 billion, comprising government-owned shares and shares held by corporations and by numerous individuals. As reported by Troubled Company Reporter-Asia Pacific, Fitch Ratings affirmed on August 31, 2007, the ratings of Bank of Shanghai, showing: (a) Long-term foreign currency Issuer Default rating at BB- with Stable Outlook; (b) Short-term foreign currency IDR at B; (c) Individual D; (d) Support at 3; and (e) Support Rating Floor at BB-. CHINA EASTERN: Borrows $337 Million For New Airplanes ----------------------------------------------------- China Eastern Airlines Corporation Limited is considering a new $337 million loan from abroad to fund its purchase of additional aircraft, Bruce Stanley of The Wall Street Journal reports. The carrier's move, WSJ relates, could either be a sign of desperation due to the company's mounting financial difficulties, or simply an attempt to benefit from the depreciating dollar. According an article posted April 16 by the Centre for Asia Pacific Aviation, despite reporting a return to profit in 2007, dealers said China Eastern Airlines' earnings prospects this year are clouded by a likely surge in operating costs as crude oil prices remain at record levels. CAPA says the carrier recorded a net profit of 269 million yuan for 2007, significantly lower than the 621.27 million yuan expected by analysts polled by Thomson Financial. On April 16, 2008, the Troubled Company Reporter-Asia Pacific, citing Bloomberg, reported that China Eastern Airlines plans to add 19 aircraft this year as economic growth spurs travel demand in China. The carrier is expected to receive 17 Airbus SAS planes and two Boeing Co. aircrafts, TCRAP's report added. Commenting on the planned loan, China Eastern executive director Luo Zhuping told Andrew Pasek- Vanburen at Xinhua Finance that, �We take out loans of all sorts very frequently to meet our operational needs, so these loans shouldn't be anything out of the ordinary." Meanwhile, in yet another burden to the carrier's balance sheet, a person familiar with the debt situation at China Eastern told WSJ that the company had missed payments totaling 3.74 billion yuan ($535 million) that were due at the end of February. About China Eastern Airlines Headquartered in Shanghai, China, China Eastern Airlines Corporation Limited's -- http://www.ce-air.com-- principal activity is operation of domestic and international commercial air transportation. The Group also is involved in the common aircraft industry. Other activities include general aviation, air catering, advertisement, import and export, equipment manufacturing, real estate, hotel business, finance and training. As of December 31, 2006, it operated a fleet of 205 aircraft, including 182 jet passenger aircraft and 11 jet freighters. The company operated a total of 423 routes serving a total of 136 foreign and domestic cities. Its operation centering from Shanghai to the whole People's Republic of China and linking to Asia, Europe, America and Australia. * * * On Feb. 27, 2008, Fitch Ratings affirmed China Eastern Airlines Corp. Ltd.'s �B+� Long Term Issuer Default Rating and �B+� Local Currency Long Term Issuer Default Rating with a stable outlook. CHINA FISHERY: Unit to Buy Epesca Pisco for US$19.9 Million ----------------------------------------------------------- China Fishery Group Limited's unit, C.F.G Investment S.A.C, has signed an agreement to purchase Epesca Pisco S.A.C's issued share capital, Reuters reports. According to the report, the shares are priced at US$19.9 million, but is still on consideration. China Fishery Group Ltd's main operations are deep-sea industrial fishing in the Pacific and the provision of management services for fishing vessels. It employs over 600 crew and officers. Its catches are processed onboard and frozen, packed and delivered to market. It recently acquired Alexandra SAC, which operates in Peru's fishing and fishmeal processing markets. As reported by the Troubled Company Reporter - Asia Pacific on Feb. 20, 2007, Moody's Investors Service affirmed its B1 rating for CFG Investment SAC's senior unsecured notes, which are unconditionally and irrevocably guaranteed by China Fishery Group Ltd, following the issuance's completion. At the same time, Moody's affirmed CFG's B1 corporate family rating. Moody's has also removed both ratings from their provisional status. The ratings outlook is stable. CHINA FISHERY: Dividend Payment Date Not Yet Scheduled ------------------------------------------------------ China Fishery Group Limited has not yet determined a specific date for the payment of dividends to its shareholders. Reuters reports that China Fishery will be paying a first cash dividend of 3.29 Singapore cents per ordinary share (tax not applicable) for a par value of shares of SG$0.05. The company, the report relates, will also pay a final cash dividend of 2.19 Singapore cents per ordinary share (tax not applicable) for a par value of shares of SG$$0.05. China Fishery Group Ltd's main operations are deep-sea industrial fishing in the Pacific and the provision of management services for fishing vessels. It employs over 600 crew and officers. Its catches are processed onboard and frozen, packed and delivered to market. It recently acquired Alexandra SAC, which operates in Peru's fishing and fishmeal processing markets. As reported by the Troubled Company Reporter - Asia Pacific on Feb. 20, 2007, Moody's Investors Service on Feb. 16, 2007, affirmed its B1 rating for CFG Investment SAC's senior unsecured notes, which are unconditionally and irrevocably guaranteed by China Fishery Group Ltd, following the issuance's completion. At the same time, Moody's has affirmed CFG's B1 corporate family rating. Moody's has also removed both ratings from their provisional status. The ratings outlook is stable. CITIC PACIFIC: To Pay Dividend of HK$0.80 Per Share --------------------------------------------------- CITIC Pacific Limited's directors recommended, subject to the approval of the shareholders at the forthcoming Annual General Meeting, the payment of a final dividend of HK$0.80 per share in respect of the year ended December 31, 2007, Reuters reports. According to the report, the dividend is payable on May 13, 2008 to shareholders on the Register of Members at the close of business on May 8, 2008. Based in Hong Kong, CITIC Pacific Ltd -- http://www.citicpacific.com/-- is engaged in a range of businesses in China and Hong Kong, including steel manufacturing, property development and investment, power generation, aviation, infrastructure, communications and distribution. It is 29% indirectly owned by China International Trust & Investment Corporation. As reported by Troubled Company Reporter - Asia pacific on Dec. 26, 2007, Standard & Poor's Ratings Services affirmed its 'BB+' corporate credit rating on CITIC Pacific Ltd. (CITIC Pacific). The outlook is stable. At the same time, Standard & Poor's affirmed the 'BB+' issue rating on senior unsecured notes issued by CITIC Pacific Finance (2001) Ltd. and guaranteed by CITIC Pacific. On June 28, 2006, Standard & Poor's Ratings Services lowered its long-term corporate credit rating on CITIC Pacific Ltd to BB+ from BBB-. At the same time, it removed the rating from CreditWatch, where it had been placed with negative implications on April 7, 2006. The outlook is stable. In addition, the TCR-AP reported that Moody's Investors Service on June 16, 2006, assigned a Ba1 corporate family rating to CITIC Pacific Ltd and has withdrawn its Baa3 issuer rating. The senior unsecured rating for CITIC Pacific Finance (2001) Ltd's bond is downgraded to Ba1 from Baa3. The rating outlook is stable. This concludes the review initiated by the rating agency in April 2006. EMI GROUP: Restructuring Continues Despite Contractual Hurdles -------------------------------------------------------------- EMI Group Plc reiterated that its planned restructuring is on track despite contractual obstacles on implementing it, Reuters reports. Reuters' sources said some challenges appeared and slowed down EMI's restructuring plan. The issues include: * "key man" clauses in contracts that allow artists to leave EMI if a label president or A&R executive who signed the act leaves or is fired; * clauses in executive contracts that allow top employees to leave if their responsibilities change or the company comes under new ownership or management; and * meeting deadlines by certain sectors of the company. An EMI executive confirmed to Reuters that the overall restructuring is slow "because some people are missing their deadlines. The sources commented to Reuters that Terra Firma, which acquired EMI in August 2007 for GBP2.4 billion, may not have realized the extent to which the "key man" contracts exist within the label. Reuters' sources added that a number top EMI executives want to leave, claiming breach of contract due to impending changes in title or responsibilities. The sources said EMI is fighting executives in instances where it believes it is in the right. As reported in the TCR-Europe on Jan. 16, 2008, Terra Firma unveiled a restructuring plan for EMI. The plan entails: * positioning EMI's labels to ensure they will be completely focused on A&R and maximizing the potential of all their artists; * developing a new partnership with artists, based on transparency and trust, and helping all artists monetise the value of their work by opening new income streams such as enhanced digital services and corporate sponsorship arrangements; * bringing together all the group's key support activities including sales, marketing manufacturing and distribution into a single division with a unified global leadership; and * the elimination of significant duplications within the group to simplify processes and reduce waste. The changes, which will be implemented over the next six months, will enable the group to invest more in its A&R operations both to identify and sign promising new artists and to maximize the potential of its existing roster. About EMI Group plc Headquartered in London, United Kingdom, EMI Group PLC -- http://www.emigroup.com/-- is the world's largest independent music company, operating directly in 50 countries, with licensees in a further 20 and employs around 5,500 people. The group has operations in Brazil and China among others. In August 2007 EMI was acquired by private equity firm Terra Firma. At March 31, 2007, EMI Group's consolidated balance sheet revealed GBP1.5 billion in total assets, GBP2.65 billion in total liabilities resulting to GBP1.15 billion in shareholders' deficit. EVERBRIGHT BIOPHARMACEUTICAL: Places 12 Million New Shares ---------------------------------------------------------- Everpride Biopharmaceutical Company agreed to place 120,000,000 new shares to independent investors at the placing price of HK$0.25 per placing share, Reuters reports. According to the report, the placing shares represent 20% of the issued share capital of the company and approximately 16.67% of the issued share capital of the company as enlarged by the allotment and issue of the placing shares. The gross proceeds from the placing will be HK$30 million. The net proceeds from the placing of approximately HK$29 million. Based in Hong Kong, Everpride Biopharmaceutical Company Limited is an investment holding company. Through its subsidiaries, the company is engaged in the production and sales of the medicines known as Plasmin Capsule and Puli Capsule in Mainland China. The Troubled Company Reporter - Asia Pacific reported on April 18, 2008, that the company has a shareholder's equity deficit of US$0.02 million on total assets of US$14.19 million. EVERBRIGHT BIOPHARMA: Annual Report Posting Moved to May 15 ----------------------------------------------------------- Everpride Biopharmaceutical Company's release of its consolidated audited results will be further delayed to May 4, 2006, Reuters reports. Meanwhile, the report relates, the dispatch of the annual report for the year ended December 31, 2005, will be delayed to May 15, 2006. Based in Hong Kong, Everpride Biopharmaceutical Company Limited is an investment holding company. Through its subsidiaries, the company is engaged in the production and sales of the medicines known as Plasmin Capsule and Puli Capsule in Mainland China. The Troubled Company Reporter - Asia Pacific reported on April 18, 2008, that the company has a shareholder's equity deficit of US$0.02 million on total assets of US$14.19 million. FIAT SPA: Shows Interest in Acquiring Serb Car Maker Zastava ------------------------------------------------------------ Fiat SpA has expressed its intention to acquire Serbia's lone auto manufacturer, Zastava, various reports say citing outgoing Economic Minister Mladjan Dinkic. Representatives from Fiat are expected to arrive Serbia this week to start talks. The sale of Zastava was supposed to occur this month but was later moved to May due to the elections. Fiat, reports add, is said to be planning to invest up to EUR300 million in Zastava. Turin, Italy-based Fiat SpA -- http://www.fiatgroup.com/-- (BIT:F) is principally engaged in the design, manufacture and sale of automobiles, trucks, wheel loaders, excavators, telehandlers, tractors and combine harvesters. Through its subsidiaries, Fiat operates mainly in five business areas: Automobiles, including sectors led by Maserati SpA, Ferrari SpA and Fiat Group Automobiles SpA, which design, produce and sell cars under the Fiat, Alfa Romeo, Lancia, Fiat Professional, Abarth, Ferrari and Maserati brands; Agricultural and Construction Equipment, which is led by Case New Holland Global NV; Trucks and Commercial Vehicles, which is led by Iveco SpA; Components and Production Systems, which includes the sectors led by Magneti Marelli Holding SpA, Teksid SpA, Comau SpA and Fiat Powertrain Technologies SpA, and Other Businesses, which includes the sectors led by Fiat Services SpA, a publishing house Editrice La Stampa SpA and an advertising agency Publikompass SpA. Outside Europe, the company has subsidiaries in the United States, Japan, India, China, Mexico, Brazil and Argentina, among others. * * * As of March 13, 2008, Fiat S.p.A. and its subsidiaries carries Ba3 Corporate Family and Senior Unsecured ratings from Moody's Investors Service, which said the outlook is positive. The company carries Standard & Poor's Ratings Services' BB long- term corporate credit rating. JIANGXI COPPER: First-Quarter Net Profit Up 46.42% to CNY1.26BB --------------------------------------------------------------- Jiangxi Copper Co Limited's first quarter net profit rose 46.42% year-on-year to CNY1.26 billion yuan after obtaining higher selling prices for its main products, China Daily News reports. According to the report, the company's operating revenue rose 49.32% year-on-year to CNY11.89 billion on higher prices and sales volumes achieved for copper cathode and sulphuric acid. Meanwhile, the report relates, operating costs were also up 46.9% year-on-year to CNY9.89 billion due to rising copper cathode costs and higher procurement expenses. Earnings per share came in at CNY0.42, against CNY0.29 a year earlier, the report adds. About Jiangxi Copper Jiangxi Copper Company Limited -- http://www.jxcc.com/-- is an integrated producer of copper in the People's Republic of China. The company's operations consist of copper mining, milling, smelting and refining to produce copper cathode and other related products, including pyrite concentrates, sulphuric acid and electrolytic gold and silver. It also provides smelting and refining services pursuant to tolling arrangements for customers. Xinhua Far East China Ratings gave the company a BB+ issuer credit rating. LAND BANK: S&P Holds C+ Bank Fundamental Strength Rating -------------------------------------------------------- Standard & Poor's Ratings Services revised the outlook on Land Bank of Taiwan to developing from positive. At the same time, it affirmed the 'A' long-term and 'A-1' short-term counterparty credit ratings on the bank, as well as the 'C+' bank fundamental strength rating. "The outlook revision mainly reflects the uncertainty surrounding Land Bank's credit profile over the next two to three years. The bank is likely to face rising pressure to maintain its profitability and asset quality if the domestic real estate market turns soft or competition intensifies," said credit analyst Andrew Wu. Nevertheless, Land Bank's financial strength is likely to improve if it completes a planned merger with the financially stronger Bank of Taiwan (A+/Stable/A-1). The Taiwan government plans to merge the two banks within three years. The ratings reflect Land Bank's established franchise, good funding capacity, and a degree of government support. Counterbalancing factors include the sensitivity of the bank's credit profile, due to its specialized real estate-related loans and its mediocre profitability. Land Bank's asset quality is sensitive to cycles in the domestic real estate market. Construction lending and mortgage loans accounted for more than 50% of the bank's total loans in 2007, up from 40% in 2003. However, the bank's ratio of impaired assets (including official NPLs and foreclosed property) to total loans was only 1.2% at the end of 2007, due to its adequate underwriting controls and good conditions in the real estate market. Land Bank's profitability is mediocre. Above-average funding costs from policy-related obligations and sizable low-margin mortgage lending hamper the bank's capacity to generate earnings. Its adjusted return on average assets (excluding sizable nonrecurring gains from real estate disposals) averaged 0.1% in 2006-2007. Its net interest margin was also low at 0.87% in 2007. PETROLEOS DE VENEZUELA: Gov't Approves Oil Sudden-Gains Tax ----------------------------------------------------------- Venuzuela's lawmakers have given their final nods to a new tax on windfall profits of Petroleos de Venezuela SA and other oil companies, Dow Jones Newwires reports. According to the report, the lawmakers gave their final approval on Apr. 15 to a law that required companies that export crude from Venezuela to share a portion of their sudden gains to the government. The levy will also apply to PdVSA's foreign partners including Total SA, StatoilHydro ASA, BP Plc, and Chevron Corp, Dow Jones states. The government will take in about 92 cents for every extra dollar when world prices are above US$70 a barrel and then 97 cents when they are above US$100 a barrel, Reuters cites Oil Minister Rafael Ramirez as saying. World oil prices hit a record above US$114 a barrel on April 15, the news agency points out. The tax is expected to contribute US$9 billion to the government's yearly revenues. About Petroleos de Venezuela SA Petroleos de Venezuela SA -- http://www.pdv.com/-- is Venezuela's state oil company in charge of the development of the petroleum, petrochemical and coal industry, as well as planning, coordinating, supervising and controlling the operational activities of its divisions, both in Venezuela and abroad. The company has a commercial office in China. PDVSA is one of the top exporters of oil to the US with proven reserves of 77.2 billion barrels of oil -- the most outside the Middle East -- and about 150 trillion cu. ft. of natural gas. PDVSA's exploration and production take place in Venezuela, but the company also has refining and marketing operations in the Caribbean, Europe, and the US. * * * As of Feb. 14, 2008, Fitch Ratings held Petroleos de Venezuela SA's long-term issuer default rating and local currency long term issuer default rating at BB-. Fitch said the ratings outlook is negative. WAN HAI LINES: S&P Cuts Rating on Unit's Corporate Bonds to BB+ --------------------------------------------------------------- Standard & Poor's Ratings affirmed its 'BBB-' long-term corporate credit rating on Wan Hai Lines Ltd. The outlook is stable. At the same time, Standard & Poor's lowered its issue rating on the unsecured corporate bonds of its fully owned subsidiary, Wan Hai Lines (Singapore) Pte. Ltd., to 'BB+' from 'BBB-'. Wan Hai irrevocably and unconditionally guarantees the bonds. "The rating affirmation reflects Wan Hai's stable performance on intra-Asia routes, together with strong demand on Middle East and European routes, which improved its EBITDA margin in 2007," said credit analyst Daniel Hsiao. The carrier's EBITDA rose by 53% to Taiwan dollar (NT$) 10.6 billion in 2007. Its cash and liquid financial assets declined by NT$5.47 billion due to high capital expenditure of NT$19.8 billion in 2007. As a result, Wan Hai's adjusted ratio of funds from operations (FFO) to debt improved slightly to 46% in 2007, from 45% in 2006. We expect the ratio to be about 40% over the next two years. Wan Hai has a somewhat aggressive new capacity expansion plan, at about 30% of its current fleet size, but this is below the top 50 global container-shipping operators' average of 50%. Nevertheless, the carrier is not immune from the high industry risks associated with cyclical demand and potential oversupply. The industry's high order book, coupled with a potential downturn in the global economy, could drive down freight rates and revenue. Wan Hai has increased its exposure to the highly competitive and volatile long-haul markets, which could enlarge its revenue base and profitability, but also raise its earnings volatility. Revenue from long-haul markets increased to 41% in 2007 from 24% in 2003. The lowered rating on the unsecured corporate bonds reflects Wan Hai's rising ratio of priority debt (including secured debt and operating lease obligations) to adjusted assets (total assets plus operating lease obligations). The ratio, which stood at 26% in 2007, is higher than the 20% threshold required for the rating to remain at the current level. The ratio is likely to increase over the next two years because of Wan Hai's greater use of operating leases. Wan Hai Line was founded in 1965. At the beginning, Wan Hai's business was mainly on the log transportation among Taiwan, Japan and the Southeast Asia. In 1976, in order to respond to the rapid development of international trade in the Asia Pacific area and the trend of international transportation containerization, Wan Hai has successfully transformed and entered the business of fully-container vessel shipping. Wan Hai has more than 30 years of experiences in shipping, comprehensive hardware and software equipment, and professional services from our staff. This has made Wan Hai the carrier with the most intensive voyages and complete service network in Asia. YRC WORLDWIDE: Renews Asset-Backed Securitization Facility ---------------------------------------------------------- On April 18, 2008, YRC Worldwide Inc. renewed its asset-backed securitization facility. The renewed facility will expire on April 16, 2009. The renewed facility: 1. reduces the financing limit available under the ABS facility from US$700 million to US$600 million, 2. reduces the letters of credit sublimit from US$325 million to US$125 million, 3. modifies the total leverage ratio consistent with the credit agreement amendment, 4. increases the loss and discount reserve requirements and 5. increases the administrative fee, calculated based on financing limit, and program fee, calculated based on utilization, to 50 basis points and 75 basis points. The interest rate under the ABS facility for conduits continues to be a variable rate based on A1/P1 rated commercial paper,weighted average interest rate of 3.35% at March 31, 2008, plus the program fee. The interest rate for Wachovia Bank National Association is one-month LIBOR, plus 100 basis points, as Wachovia will no longer use a conduit to purchase receivables under the ABS facility. The company expects interest expense to increase up to US$4.0 million annually with this renewal. The ABS facility utilizes the accounts receivables of these subsidiaries of the company: Yellow Transportation Inc.; Roadway Express Inc.; USF Holland Inc.; and USF Reddaway Inc. Yellow Roadway Receivables Funding Corporation, a special purpose entity and wholly owned subsidiary of the company, operates the ABS facility. Under the terms of the renewed ABS facility, the originators may transfer trade receivables to YRRFC, which is designed to isolate the receivables for bankruptcy purposes. A third-party conduit or committed purchaser must purchase from YRRFC an undivided ownership interest in those receivables. The percentage ownership interest in receivables that the conduits or committed purchasers purchase may increase or decrease over time, depending on the characteristics of the receivables, including delinquency rates and debtor concentrations. In connection with the renewal of the ABS facility, the company unconditionally guaranteed to YRRFC the full and punctual payment and performance of each of the Originators obligations under the ABS facility. YRRFC has pledged its right, title and interest in the guarantee to the administrative agent, for the benefit of the purchasers, under the third amended and restated receivables purchase agreement. About YRC Worldwide YRC Worldwide (Nasdaq: YRCW) -- http://www.yrcw.com/-- does business through two national less-than-truckload companies, YRC National Transportation, which comprises the long-haul operations that comprises the legacy Yellow and Roadway businesses (about 69% of total FY 2007 revenue), and through YRC Regional Transportation, a regional LTL business essentially comprising YRC's acquired USF companies (about 25% of revenue). Through its YRC Logistics business unit, the company also offers logistics and supply chain services. YRC's broad service offering includes next day and expedited service throughout most of the country. Headquartered in Overland Park, Kansas, YRC Worldwide employs approximately 60,000 people. The company has subsidiaries in Bermuda, the United Kingdom, Netherlands, Singapore, Hong Kong and Mexico. YRC WORLDWIDE: Agrees to Amendments on Aug. 17 Credit Agreement --------------------------------------------------------------- On April 18, 2008, YRC Worldwide Inc. and certain of its foreign subsidiaries entered into Amendment No. 1 to the credit agreement, dated as of Aug. 17, 2007. The credit agreement, as amended, continues to provide the company with a US$950 million senior revolving credit facility, including sublimits available for borrowings under certain foreign currencies, and a US$150 million senior term loan. The credit agreement amendment will: 1. increase the company#s total leverage ratio from 3.0x to 3.75x for each of the fiscal quarters ended March 31, June 30 and Sept. 30, 2008 and 3.5x for each fiscal quarter thereafter, until such time as the company receives a rating of BBB- or better from Standard & Poor's and Ba1 or better from Moody's, in each case with a stable outlook. This was a proactive amendment however, as the company's total leverage ratio for the fiscal quarter ended March 31, 2008 was below 3.0x; 2. increase the interest rates and fees applicable to the revolving credit facility and term loan. The interest rate on amounts outstanding under the revolving credit facility and term loan is LIBOR plus 100 basis points and LIBOR plus 125 basis points and the facility fee for the revolving credit facility is 25 basis points. The company expects interest expense to increase US$1.5 # 4.0 million annually with this amendment; 3. require the company and its domestic subsidiaries to pledge these collateral: a. receivables not secured by the ABS facility or the company#s captive insurance companies, b. intercompany notes not secured by the ABS facility, c. fee-owned real estate parcels that have an estimated internal market value of US$2.5 million or greater, d. 100% of the stock of all domestic subsidiaries of the company, and e. 65% of the stock of first-tier foreign subsidiaries of the company other than the company's captive insurance companies; 4. require the company and its subsidiaries to pledge additional assets, including rolling stock and the remaining real estate if the total leverage ratio exceeds 3.5x at the end of any test period or if the company receives a rating of BB- or worse from Standard & Poor#s and Ba3 or worse from Moody's prior to the Fall Away Event; 5. require each domestic subsidiary of the company except for YRRFC to guarantee the credit facility; and 6. modify certain negative covenants, and in certain instances introduces new negative covenants, related to permitted liens, permitted acquisitions, permitted asset sales, and certain related mandatory prepayments from the proceeds thereof, and restricted payments. Upon the occurrence of the Fall Away Event, security interests in pledged collateral will be released, all negative covenant provisions,including the company's total leverage ratio, and the mandatory prepayment provision will revert to pre-credit agreement amendment levels and concepts and only material domestic subsidiaries and subsidiaries of the company that guarantee certain other indebtedness of the company or its subsidiaries will remain as guarantors. USF and Roadway Bonds The holders of USF Bonds and Roadway Bonds will receive an equal and ratable lien, pursuant to the terms of the respective bond indentures, in certain assets that are pledged under the credit facility. Pursuant to Section 1008 of the USF Bond indenture, holders of USF Bonds are entitled to an equal and ratable lien with respect to stock of the 'significant' subsidiaries of YRC Regional Transportation and any intercompany debt among Regional and its 'significant' subsidiaries. Currently, the 'significant' subsidiaries are USF Holland, USF Reddaway and YRC Logistics Services. Pursuant to Section 4.06(a) of the Roadway Bond indenture, holders of Roadway Bonds are entitled to an equal and ratable lien with respect to stock of subsidiaries of Roadway LLC, intercompany debt among Roadway and its subsidiaries and certain property owned by Roadway and its subsidiaries, including certain real estate and rolling stock. The description of the rights of the holders of USF Bonds and Roadway Bonds is qualified by reference to the respective indentures, which are filed as Exhibit 4.3.1 and Exhibit 4.4.1 to the company#s form 10-K for the year ended Dec. 31, 2007, respectively. About YRC Worldwide YRC Worldwide (Nasdaq: YRCW) -- http://www.yrcw.com/-- does business through two national less-than-truckload companies, YRC National Transportation, which comprises the long-haul operations that comprises the legacy Yellow and Roadway businesses (about 69% of total FY 2007 revenue), and through YRC Regional Transportation, a regional LTL business essentially comprising YRC's acquired USF companies (about 25% of revenue). Through its YRC Logistics business unit, the company also offers logistics and supply chain services. YRC's broad service offering includes next day and expedited service throughout most of the country. Headquartered in Overland Park, Kansas, YRC Worldwide employs approximately 60,000 people. The company has subsidiaries in Bermuda, the United Kingdom, Netherlands, Singapore, Hong Kong and Mexico. YRC WORLDWIDE: Fitch Holds 'BB+' ID Rating on Facility Amendment ---------------------------------------------------------------- Following the announcement that YRC Worldwide Inc. has amended and restated its credit facility agreement, Fitch Ratings has taken these rating actions on YRCW and its Roadway LLC and YRC Regional Transportation, Inc. subsidiaries: YRC Worldwide Inc. -- Issuer Default Rating affirmed at 'BB+'; -- Credit facilities affirmed at 'BB+'; -- Senior unsecured downgraded to 'BB' from 'BB+'. Roadway LLC -- IDR affirmed at 'BB+'; -- Senior notes downgraded to 'BB' from 'BB+'. YRC Regional Transportation, Inc. -- IDR affirmed at 'BB+'; -- Senior notes downgraded to 'BB' from 'BB+'. Fitch's ratings apply to approximately US$1 billion in consolidated debt and a US$950 million revolving credit facility. The Rating Outlook for YRCW is Negative. The most significant revisions to YRCW's credit facility are a change in the facility's leverage covenant and a pledge of collateral to secure the facility. The leverage covenant, which is based on the ratio of balance sheet debt to 12 months EBITDA, has been raised to 3.75 times for the first three quarters of 2008. The ratio will then decline to 3.5x in the fourth quarter of 2008 through the facility's maturity in 2012. The prior leverage covenant was 3.0x for the duration of the agreement. In the event of certain credit ratings upgrades, the collateral securing the credit facility will be released, the leverage ratio covenant will decline to 3.0x and certain other provisions in the credit facility will revert back to their pre-amended status. In return for the loosened covenant, YRCW has agreed to secure the facility with a combination of hard assets, a portion of various subsidiaries' accounts receivable not already pledged as collateral under YRCW's asset backed securitization facility agreement, 100% of the capital stock of YRCW's U.S. subsidiaries, 65% of the stock of certain first-tier foreign subsidiaries and a security interest in certain intercompany notes. According to the indenture covering the outstanding US$225 million in Roadway notes due in December, the Roadway notes will also be secured by certain Roadway collateral pledged to the credit facility, including certain Roadway properties. In addition, the capital stock of the YRC Regional Transportation subsidiaries that has been pledged as collateral for the credit facility will also be shared as collateral with the two series of outstanding YRC Regional Transportation notes. In addition to the revisions to its credit facility, YRCW has also accelerated the renewal of its ABS facility. The facility had been scheduled to mature next month. The ABS facility, which is essentially a receivables sales program, is a key component of the company's liquidity, and YRCW regularly uses it for cash borrowings, as well as to back letters of credit. The limit on the renewed facility has been reduced to US$600 million from US$700 million, however, to account for the actual level of receivables generally available to support the program. The loosening of the leverage covenant significantly reduces the likelihood of a near-term default on the credit facility. Although YRCW has been slowly reducing its debt load over the past several years, a very weak industry demand environment has driven a sharp decline in YRCW's EBITDA over the past 12 months. Full-year EBITDA declined to US$489 million in 2007 from US$837 million in 2006, raising the company's year-end EBITDA leverage to 2.5x from 1.5x. With the sharp decline in EBITDA, concern had been growing recently that YRCW's EBITDA leverage would come uncomfortably close to, or might exceed, the prior covenant level of 3.0x by mid-2008. The addition of 75 basis points to the covenant in the first three quarters of this year is expected to provide sufficient headroom to avoid a covenant-triggered default in the near term. However, the covenant level's decline to 3.5x in the fourth quarter and beyond could be a concern if industry conditions continue to worsen throughout the year. The downgrade of the senior unsecured ratings reflects the addition of collateral to secure the credit facility, which has put the holders of the company's existing unsecured notes in a junior position in YRCW's capital structure. In addition, although the Roadway and YRC Regional Transportation notes are now secured by some collateral, Fitch believes the collateral coverage of these notes is relatively low, effectively putting holders of these notes in a position similar to that of the unsecured holders. As a result, Fitch has downgraded the secured Roadway and YRC Regional Transportation notes, as well. The Negative Rating Outlook reflects the near-term challenges that YRCW continues to face with the slowing of the U.S. economy. Although industry shipment levels appear to be stabilizing somewhat, they are stabilizing at weakened levels, and there are no indications yet of a significant improvement in demand in the near term. Should a persistently weak industry environment drive further declines in YRCW's financial performance, Fitch may downgrade the ratings further. YRC WORLDWIDE: Moody's Cuts CF Rating to Ba2 -------------------------------------------- Moody's Investors Service has lowered the ratings of YRC Worldwide Inc., Corporate Family Rating to Ba2 from Ba1. At the same time, Moody's downgraded the ratings of YRC Regional Transportation's senior notes and YRC Worldwide's convertible notes to Ba3 from Ba1, and upgraded the ratings of the notes issued by the company's Roadway subsidiary to Baa3 from Ba1. Under the terms of "equal and ratable" provisions contained in the indentures, these notes will be granted a security interest in certain assets of the company that ranks pari passu with the security interest granted on those assets under the company's amended bank credit facility. The rating outlook is negative. The downgrade of the Corporate Family Rating considers the continued challenging operating environment in the trucking sector which is expected to further constrain YRC's earnings and cash flow, resulting in weaker credit metrics. Moody's views favorably the company's announcement that it has amended its senior revolving credit facility to provide increased room under prescribed financial covenants as well as the renewal and amendment of its Asset Backed Securitization facility. The ability to comply with prior covenant levels would have become problematic for YRC in light of anticipated earnings weakness. The amended covenants will enable the company to maintain a good liquidity profile while implementing strategies to improve operating performance. According to David Berge, Vice President of Moody's, "there is still significant headwind facing the company from what is expected to be a deep and possibly prolonged recession in the trucking market." Moody's expects that YRC, like most less than truckload carriers, will report weak operating results through 2008. The company should benefit from recent cost saving initiatives, including the closure of unprofitable business units in its regional segment, and enhanced operating flexibility available under its new labor agreement with the Teamsters running through 2013. Nevertheless, cyclical operating pressures will continue to weigh on overall financial performance. Key credit metrics such as Retained Cash Flow to Debt, EBIT/Interest, and Debt to EBITDA are currently weaker than those of many industry peers. YRC has reduced its balance sheet debt since the 2005 acquisition of USF Corporation, yet with the erosion of earnings during 2007 financial metrics have deteriorated. Under Moody's analytic methodology, the company carries a high debt burden related to adjustments for multi- employer pension plans. While the multi-employer obligations are viewed as debt-like in Moody's analysis, it is important to note that they do not represent a large near term claim on cash. Moody's anticipates that YRC will continue to apply free cash flow to reduce indebtedness which should help to rebuild financial metrics over time. Moody's expects that the company will be able to generate sufficient operating cash flow through 2008 to cover repayment of the US$225 million of notes due in December. This will likely require that operating ratios of at least 96-97% are achieved for the second half of the year, and that cash contributions from working capital in the fourth quarter follow historical seasonal patterns. Given the challenges posed by the weak business environment, the recent covenant amendment provides important stability to the company's liquidity profile. YRC maintains a modest cash balance, and typically experiences seasonal variances in its working capital requirements; the fourth quarter generally exhibits a significant cash inflow from working capital reductions. The company's US$950 million revolving credit facility and US$150 million Term Loan contain a financial covenant limiting its ratio of debt to EBITDA, as defined in the agreement, to certain levels. While the company has remained in compliance with the covenant through the first quarter of 2008, continued earnings pressures might have resulted in the company being unable to remain compliant in future quarters. The recently announced amendment provides covenant headroom which should enable the company to maintain an adequate liquidity profile. In exchange for covenant relief, YRC is providing a collateral package comprised of certain parcels of real estate and accounts receivable not pledged to its securitization facilities. The company will also provide a pledge of 100% of stock of domestic subsidiaries and 65% of stock of first tier foreign subsidiaries. By virtue of the "equal and ratable" provision, the Roadway and YRC Regional notes will gain a security interest that ranks pari passu with the company's bank credit facility. The outlook remains negative in recognition of the sensitivity of cash flows and covenant cushion to changes in the company's operating ratio. Considering YRC's and the LTL sector's overall vulnerability to weaknesses in the U.S. economy and the uncertainty surrounding the depth and duration of the current economic downturn, Moody's believes there are significant challenges facing the company in reaching its margin and cash flow goals. The change in ratings of the senior notes, which had been rated the same as YRC's Corporate Family Rating prior to the amendment of the credit facility, reflects the effect of both the downgrade in the CFR as well as collateral protection granted lenders under the Roadway notes, which is not afforded to the YRC convertible notes. The indenture for the Roadway notes and the indenture for the YRC Regional Transportation notes provides that, in the event of YRC pledging collateral as security for any other debt instrument, the Roadway notes and YRC Regional Transportation notes will be secured equally and ratably by a pledge of specified collateral. However, Moody's views the collateral protection being afforded to the Roadway notes as substantially superior to that of the YRC Regional Transportation notes, effectively subordinating these notes to the Roadway notes. Per Moody's Loss Given Default methodology, the change in priority from senior unsecured class of debt to senior secured has a substantial positive impact on the expected recovery on these notes in the event of default. Conversely, the effective subordination of the unsecured YRC Convertible notes and the YRC Transportation notes to a substantial level of secured debt implies weaker recovery under those notes in the event of default. The ratings could be downgraded if the free cash flow in 2008 were to fall substantially below US$200 million, therefore requiring the company to rely more heavily on its revolving credit facility to refinance the December maturities and likely the notes maturing in May 2009 as well, assuming they cannot be refinanced in the capital markets. Ratings could also be lowered if weaker operating performance were to impair the likelihood of compliance with the new financial covenants in the company's credit facility, possibly requiring waivers or further amendments of terms. The ratings could be stabilized if free cash flows become strongly positive in 2008 and 2009, with operating ratios returning to the mid-90% range. The company will have to demonstrate the maintenance of a solid liquidity position throughout this period, with only minor and temporary reliance, if any, on the revolving credit facility to cover note maturities while maintaining ample cushion to covenants. Downgrades: Issuer: USF Corporation -- Senior Notes due 2009-2010, to Ba3 (LGD4-63%) from Ba1 Issuer: YRC Worldwide Inc. -- Probability of Default Rating, Downgraded to Ba2 from Ba1 -- Corporate Family Rating, Downgraded to Ba2 from Ba1 -- Senior Convertible Notes due 2023, to Ba3 (LGD4-63%) from Ba1 Upgrades: Issuer: Roadway LLC -- Senior Notes due 2008, to Baa3 (LGD2-14%) from Ba1 YRC Worldwide does business through two national less-than- truckload companies, YRC National Transportation, which comprises the long-haul operations that comprises the legacy Yellow and Roadway businesses (about 69% of total FY 2007 revenue), and through YRC Regional Transportation , a regional LTL business essentially comprising YRC's acquired USF companies (about 25% of revenue). Through its YRC Logistics business unit, the company also offers logistics and supply chain services. YRC's broad service offering includes next day and expedited service throughout most of the country. ========= I N D I A ========= GERDAU SA: To Invest US$180 Million in CCA Tie-Up -------------------------------------------------- Gerdau SA has teamed up with Central American steel corporation CCA. According to Gerdau, it will own a 30% stake and invest some US$180 million in CCA. Gerdau's President Andre Gerdau Johannpeter commented to Business News Americas, "The association listed Grupo Gerdau as a leading company in Central America and the Caribbean. The region is strategic and of special importance to the group." About CCA CCA is a steel corporation in Central America. It has a steel plant in Guatemala, four rolling units in Guatemala and Honduras and commercial offices in Guatemala, Honduras, and El Salvador. The corporation also has distribution units in Guatemala, Belize, El Salvador, Honduras, and Nicaragua. CCA has installed capacity of 500,000 tons per year of steel and 690,000 tons per year of rolled products and also holds a minority share in Honduran company Intrefica. About Gerdau Headquartered in Porto Alegre, Brazil, Gerdau SA -- http://www.gerdau.com.br/-- produces and distributes crude steel and related long rolled products, drawn products, and long specialty products. In addition to Brazil, Gerdau operates in Argentina, Canada, Chile, Colombia, Uruguay, India and the United States. * * * As reported in the Troubled Company Reporter-Latin America on Nov. 26, 2007, Moody's Investors Service affirmed Gerdau S.A.'s Ba1 corporate family rating and stable outlook. GERDAU SA: Quanex Shareholders Okay US$1.67 Billion Purchase ------------------------------------------------------------ Quanex Corp. told the Associated Press that its shareholders have authorized Gerdau SA to purchase the firm for US$1.67 billion. As reported in the Troubled Company Reporter-Latin America on Feb. 22, 2008, Quanex set a special meeting of stockholders for March 31, 2008, to approve and adopt the agreement and plan of its merger with a subsidiary of Gerdau. Stockholders of record as of the close of business on Feb. 29, 2008, were entitled to vote at the special meeting. The AP relates that "with about 90% of the shares represented, over 99% were voted for the deal." Quanex's unit Quanex Building Products Corp. was "spun off from the parent." It will replace Quanex in the Standard & Poor's SmallCap 600, the AP states. About Quanex Corp. Quanex Corp., formerly Michigan Seamless Tube Company, is engaged in the production of engineered carbon and alloy steel bars, heat treated bars, aluminum flat-rolled products, flexible insulating glass spacer systems, extruded profiles, and precision-formed metal and wood products. The two markets served by the Company include vehicular products and building products. The segments served by the Company include Vehicular Products, Engineered Building Products and Aluminum Sheet Building Products. Quanex has 27 manufacturing facilities in 12 states in the United States. About Gerdau Headquartered in Porto Alegre, Brazil, Gerdau SA -- http://www.gerdau.com.br/-- produces and distributes crude steel and related long rolled products, drawn products, and long specialty products. In addition to Brazil, Gerdau operates in Argentina, Canada, Chile, Colombia, Uruguay, India and the United States. * * * As reported in the Troubled Company Reporter-Latin America on Nov. 26, 2007, Moody's Investors Service affirmed Gerdau S.A.'s Ba1 corporate family rating and stable outlook. GMAC LLC: Moody's Downgrades Senior Rating to B2 ------------------------------------------------ Moody's Investors Service downgraded GMAC LLC's senior rating to B2 from B1; the rating remains on review for further possible downgrade. This action follows Moody's rating downgrade of ResCap LLC, GMAC's wholly-owned residential mortgage unit, to Caa1 from B2. The GMAC downgrade is based upon Moody's opinion that further operating weakness at ResCap poses risks to GMAC's capital position and liquidity that exceed previous estimates. In particular, we believe that for ResCap to have continued access to debt capital, GMAC may be required to provide additional indications of support to the unit and that it is likely to do so. As noted in the ResCap related press release, ResCap faces significant near-term refinancing needs. GMAC has strategic significance to GM, as its exclusive provider of consumer incentive financing for nearly all of its brands, and as a provider of inventory floorplan loans to GM's dealer base. As a consequence, we don't believe GMAC's owners intend to compromise the firm's credit profile to the point of weakening its ability to perform under its contractual asset origination and servicing obligations to GM. It is our belief, however, that the ResCap exposures that GMAC has accumulated to date, and may yet further accumulate, represent a risk concentration that could challenge the strength of the GMAC's credit standing. During its review, Moody's will examine GMAC's intentions for supporting ResCap through its difficulties, as well as the terms pertaining to any such support extension. "We consider GMAC's stand-alone strengths in its auto finance and insurance businesses to continue to provide support to its rating profile," Moody's said. Ratings downgraded and placed under review for further downgrade include: Issuer rating: to B2 from B1 Senior Unsecured: to B2 from B1 Preferred Stock: to Caa2 from Caa1 About GMAC LLC GMAC LLC, based in Detroit, is a provider of retail and wholesale auto financing, auto insurance and warranty products, and through its wholly-owned subsidiary Residential Capital LLC, residential mortgage products and services. GMAC reported a preliminary 2007 fourth quarter consolidated net loss ofUS$724 million. GMAC LLC has a subsidiary in India called GMAC Financial Services India Limited. PRIDE INTERNATIONAL: Board Drops Ownership Threshold to 10% ----------------------------------------------------------- Pride International Inc.'s Board of Directors has taken action under the company's Stockholder Rights Plan to lower, solely with respect to Seadrill Limited and its affiliates and associates, the threshold level of beneficial ownership of the company's common stock that would trigger the rights from 15% to 10%. Pride also announced that it has been notified by Seadrill of Seadrill's and its affiliates' acquisition, through undisclosed forward purchase contracts and other acquisitions from undisclosed parties, of approximately 9.9% of the company's outstanding common stock. Seadrill has advised the Company that it has made a filing under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 to permit Seadrill to acquire Pride securities, but has neither provided the company with a copy of the filing nor informed the Company at what notification threshold the filing was made under the Act. Despite requests by the company, Seadrill has not provided information about its intentions, plans or proposals with respect to Pride or its acquisition of the common stock; any agreements, arrangements or understandings it has with third parties regarding Pride securities; the terms of the forward purchase contracts; the reasons for its Hart-Scott-Rodino filing; or the maximum ownership level specified in the filing. Seadrill also requested that Pride not publicly disclose its acquisition of Pride securities or its Hart-Scott-Rodino filing. Pride's Stockholder Rights Plan is intended to protect the company's stockholders from open-market accumulations and other abusive takeover activities. The Board of Directors of the company has taken the action with respect to the rights plan because Seadrill has not provided the Company with any information about its intentions, and the Board wants to make sure that all stockholders are protected appropriately. The plan was adopted in 2001 in connection with the Company's merger with Marine Drilling Companies to replace a similar plan in effect at Pride since 1998. About Pride International Headquartered in Houston, Texas, Pride International Inc. (NYSE: PDE) -- http://www.prideinternational.com/-- provides onshore and offshore contract drilling and related services in more than 25 countries, operating a diverse fleet of 277 rigs, including two ultra-deepwater drillships, 12 semisubmersible rigs, 28 jackups, 16 tender-assisted, barge and platform rigs, and 214 land rigs. The company maintains worldwide operations in France, Mexico, Kazakhstan, India, and Brazil, among others. * * * As reported in the Troubled Company Reporter-Latin America on Nov. 22, 2007, Standard & Poor's Ratings Service raised its corporate credit rating on offshore contract drilling firm Pride International Inc. to 'BB+' from 'BB'. At the same time, S&P raised the rating on the company's unsecured debt to 'BB+' from 'BB-'. S&P said the outlook is stable. TATA MOTORS: U.S. Antitrust Okays Jaguar and Land Rover Purchase ---------------------------------------------------------------- U.S. antitrust authorities have cleared Tata Motors Ltd.'s purchase of Jaguar and Land Rover from Ford Motor Co., Reuters reports. According to the U.S. Federal Trade Commission, antitrust authorities have completed their review of the US$2.3 billion deal between Tata and Ford without taking any action to block it, Reuters relates. The deal was formally announced on March 26, 2008. Tata will pay Ford the US$2.3 billion in cash upon closing of the transaction. The transfer of ownership is expected to close by the end of the next quarter, subject to applicable regulatory approvals, according to the Troubled Company Reporter-Asia Pacific on March 28, 2008. 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. TATA STEEL: S&P Affirms BB Corp. Credit Rating; Revises Outlook --------------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on Tata Steel Ltd. to stable from positive and affirmed its 'BB' corporate credit rating on the company. At the same time, the 'BB' rating on Tata Steel's senior unsecured bank loans of US$750 million and US$500 million has been affirmed. The outlook revision reflects the persisting uncertainty on the infusion of additional equity, as envisaged in the initial funding plan for the acquisition of Corus (Corus Group PLC, not rated), and some increases in the capital commitments of the company, specifically for its expansion projects in India. "Tata Steel's initially proposed plan of issuing hybrid securities (US$2.56 billion) and equity (US$500 million), to partially fund the US$14 billion acquisition of Corus, has been deferred due to prevailing credit market conditions," said Standard & Poor's credit analyst Anshukant Taneja. Although Tata Steel intends to raise incremental equity (US$1 billion), this has been delayed and remains vulnerable to capital market-related risks. Concurrently, Tata Steel has accelerated the execution of some of the expansion projects in India, specifically the 2.9 million tons per annum (mtpa), entailing an outlay of about US$2.3 billion, and now is pursuing the US$3.9 billion 3 mtpa greenfield Orissa steel project with greater certainty. Total costs for these projects have also risen about 20% from the initial estimates given by the company, because of widening of scope and inclusion of mining-related investments in the project costs. "These events, along with potential investments in upstream coal and limestone resources, limit the upside potential on the current ratings," Mr. Taneja said. The 'BB' ratings continue to derive support from the enhanced scale and size of the combined entity. Tata Steel is now the sixth-largest steel manufacturer in the world. Volume growth and synergy gains, which have been in line with expectations, also add to the stability of current ratings. Geographical and product diversity has also increased, which is positive for the overall risk profile of the company. The increase in steel prices, which has been driven primarily by sustained demand and rising input (iron ore and coking coal) prices, is beneficial for the fully integrated operations of the company in India. This is reflected in the estimated 43% margin for the nine months ended December 2007 for Tata Steel (standalone operations). "However, the manufacturing operations of Corus do not benefit from upstream linkages. This significantly dilutes the positive impact of the integrated Indian operations on the overall profitability of the company," Mr. Taneja noted. ================= I N D O N E S I A ================= FREEPORT-MCMORAN: Reports US$1.1 Billion Net Income in 1Q 2008 -------------------------------------------------------------- Freeport-McMoRan Copper & Gold Inc. (NYSE: FCX) reported first- quarter 2008 net income applicable to common stock ofUS$1.1 billion, US$2.64 per share, compared with US$476 million,US$2.02 per share, for the first quarter of 2007. FCX�s results included net losses on early debt extinguishments totaling US$6 million ($5 million to net income or US$0.01 per share) for first-quarter 2008 and US$88 million ($75 million to net income or US$0.31 per share) for first-quarter 2007. The results for the 2007 quarter include the operations of Phelps Dodge beginning March 20, 2007. James R. Moffett, Chairman of the Board, and Richard C. Adkerson, President and Chief Executive Officer, said, �Our first-quarter results reflect our continued focus on maximizing current production volumes and investing in future growth to meet increasing market requirements for the commodities we produce. As we crossed the one-year anniversary of our combination with Phelps Dodge in March, we are established as a financially strong global metals producer with significant current production capacity and reserves, exciting current growth projects and promising opportunities for future growth in major minerals districts around the world. The theme of our recently published 2007 annual report, �A World of Assets, A World of Opportunities,� highlights our portfolio of global operations and opportunities to expand production capacity, extend the lives of our mines and develop new ore bodies.� Highlights * Net income applicable to common stock for first-quarter 2008 totaled US$1.1 billion, US$2.64 per share, compared with US$476 million, US$2.02 per share, for first-quarter 2007. * Consolidated sales from mines for first-quarter 2008 totaled 911 million pounds of copper, 280 thousand ounces of gold and 20 million pounds of molybdenum, compared with 520 million pounds of copper, 956 thousand ounces of gold and 2 million pounds of molybdenum for first-quarter 2007. Pro forma first-quarter 2007 sales, including pre- acquisition Phelps Dodge sales, totaled 1.0 billion pounds of copper, 977 thousand ounces of gold and 19 million pounds of molybdenum. * Consolidated sales from mines are expected to approximate 4.2 billion pounds of copper, 1.4 million ounces of gold and 75 million pounds of molybdenum for the year 2008, including 930 million pounds of copper, 225 thousand ounces of gold and 18 million pounds of molybdenum for second- quarter 2008. * Operating cash flows totaled US$615 million, including working capital uses of approximately US$1.3 billion, for first-quarter 2008. Assuming average prices of US$3.75 per pound for copper, US$900 per ounce for gold and US$30 per pound for molybdenum for the remainder of 2008, operating cash flows in 2008 would exceed US$6.5 billion, including approximately US$6 billion for the remainder of 2008. Each US$0.20 per pound change in copper prices in the balance of the year would impact 2008 operating cash flows by approximately US$450 million. * Capital expenditures totaled US$508 million for first- quarter 2008. Projected 2008 capital expenditures approximate US$3 billion, including investments in development projects in the Americas and Indonesia, the Tenke Fungurume greenfield project in Africa and the project to restart the Climax molybdenum mine in Colorado. * Total debt approximated US$7.6 billion and consolidated cash was US$1.8 billion at March 31, 2008, compared with total debt of US$7.2 billion and consolidated cash of US$1.6 billion at December 31, 2007. Borrowings under FCX�s US$1.5 billion revolving credit facility totaled US$296 million at March 31, 2008. Consolidated copper sales of 911 million pounds in the first quarter of 2008 were slightly higher than previous estimates of 885 million pounds reported on January 23, 2008, primarily because of the timing of shipments. Production from North America was lower than previous estimates, while South America production was essentially as forecasted and Indonesia production exceeded prior estimates. Consolidated gold sales of 280 thousand ounces in first-quarter 2008 were higher than previous estimates of 170 thousand ounces because of mine sequencing at the Grasberg mine in Indonesia. As expected, consolidated gold sales in the first quarter of 2008 were significantly lower than the year ago period because of the mining in a lower ore grade section of the Grasberg open pit. Consolidated molybdenum sales approximated 20 million pounds in first-quarter 2008. Indonesia copper and gold sales in the first quarter of 2008 were significantly lower than in the first quarter of 2007 as a result of the expected mining in a lower ore grade section of the Grasberg open pit. At the Grasberg mine, the sequencing in mining areas with varying ore grades causes fluctuations in the timing of ore production, resulting in varying quarterly and annual sales of copper and gold. PT Freeport Indonesia expects to continue mining in a relatively low-grade section of the Grasberg open pit in the second quarter of 2008 and in a higher- grade section in the second half of 2008. Approximately 64 percent of 2008 copper sales and 65 percent of 2008 gold sales are estimated in the second half of the year. FCX expects Indonesia sales of 1.2 billion pounds of copper and 1.3 million ounces of gold for the year 2008, compared with 1.1 billion pounds of copper and 2.2 million ounces of gold for the year 2007. PT Freeport Indonesia has several projects in progress throughout the Grasberg district, including developing its large-scale underground ore bodies located beneath and adjacent to the Grasberg open pit. The expansion of the currently producing Deep Ore Zone (DOZ) mine to 50,000 metric tons of ore per day is complete with first-quarter rates averaging 61,000 metric tons per day. A further expansion of the DOZ mine to 80,000 metric tons per day is under way with completion targeted by 2010. Other projects include the development of the high-grade Big Gossan mine, expected to ramp up to full production of 7,000 metric tons per day in 2011, and the continued development of the Common Infrastructure project, which will provide access to the Grasberg underground ore body, the Kucing Liar ore body and future development of the mineralized areas below the DOZ mine. PT Freeport Indonesia�s 2008 exploration efforts in Indonesia include testing extensions of the Deep Grasberg and Kucing Liar mine complex and evaluating targets in the area between the Ertsberg East and Grasberg mineral systems from the new Common Infrastructure tunnels. Initial drill results from the Common Infrastructure tunnel are positive and additional drilling is in process. FCX continues its efforts to resume exploration activities in certain prospective areas in Papua, outside Block A (the Grasberg contract area). The number of drill rigs operating on these and other programs near FCX�s mine sites increased from 26 at the end of March 2007 to 80 currently. A full-text copy of the company's press release is available for free at http://bankrupt.com/misc/freeport_mcmoran_1Q2008.pdf About Freeport-McMoRan Freeport-McMoRan Copper & Gold Inc. (NYSE: FCX) -- http://www.fcx.com/-- is an international mining industry leader based in North America with large, long-lived, geographically diverse assets and significant proven and probable reserves of copper, gold and molybdenum. Freeport- McMoRan has one of the most dynamic portfolios of operating, expansion and growth projects in the copper mining industry. The Grasberg mine in Indonesia, the world's largest copper and gold mine in terms of reserves, is the company's key asset. Freeport-McMoRan also operates significant mining operations in North and South America and is developing the world-class Tenke Fungurume project in the Democratic Republic of Congo. The completion of Freeport-McMoran's acquisition further expands the company's global operations. The former Phelps Dodge Corp. has mining operations in Chile, Peru, Colombia, Venezuela and Ecuador, among others. As reported in the Troubled Company Reporter on April 10, 2008, Fitch Ratings upgraded the Issuer Default Rating and debt ratings of Freeport-McMoRan Copper & Gold Inc: FCX: -- Issuer Default Rating upgraded to 'BBB-' from 'BB+'; -- Unsecured notes due 2015 and 2017 upgraded to 'BBB-' from 'BB+'. -- 7% convertible notes due 2011 upgraded to 'BBB-' from 'BB+'. -- Convertible Preferred Stock upgraded to 'BB' from 'BB-'. On Feb. 21, 2008, Moody's Investors Service upgraded Freeport's corporate family rating to Ba1 from Ba2 and undertook these related rating actions: (i) upgraded to Baa1 (LGD1, 4%) from Baa2 the senior secured rating on Freeport's US$500 'million secured revolver; (ii) upgraded to Baa1 (LGD1, 9%) from Baa3 the senior secured ratings on Freeport's US$1 billion secured revolver and Freeport's 6.875% senior secured notes; and (iii) upgraded to Ba2 (LGD5, 74%) from Ba3 Freeport'sUS$6.0 billion of senior unsecured notes. Moody's also upgraded to Baa2 (LGD2, 16%) from Ba1 the ratings on Phelps Dodge's notes. Moody's said the ratings outlook for Freeport and Phelps is stable. ========= J A P A N ========= ALITALIA SPA: To Receive EUR300-Million Bridging Loan from Italy ---------------------------------------------------------------- The Italian government has approved a EUR300-million bridging loan to Alitalia S.p.A. to keep it afloat and prevent it from seeking bankruptcy protection, various reports say. As reported in the TCR-Europe on April 22, 2008, the incoming administration of Prime Minister-elect Silvio Berlusconi and the outgoing government of current Prime Ministe Enrico Prodi have initially agreed to provide a EUR150 million emergency financing to Alitalia, which only had EUR170 million in cash and credit as of March 31, 2008. Finance Minister Tommaso Padoa-Schioppa was quoted by Bloomberg News as saying that without the loan, Alitalia would have to seek protection from creditors. Mr. Prodi said Mr. Berlusconi asked him to raise the loan amount to EUR300 million to allow more "time to put together and organize possible alternative solutions," the Associated Press reports. Mr. Prodi noted that Alitalia has to repay the loan by end of 2008. State Aid Violation? The European Commission, meanwhile, would review the financing to Alitalia, whether it violates the European Union rule on state aid, Bloomberg News says citing spokesman Michele Cercone. Under EU's "one time, last time" principle, a company beneficiary of a state aid cannot receive additional rescue or restructuring funding within 10 years since its accepted financial assistance. AP quoted the Commission last week said Alitalia cannot receive further aid until 2011, since it took fiscal assistance in 2001. Italian Bidders AirOne S.p.A., banks led by Intesa Sanpaolo S.p.A. and Italian businessmen led by Mr. Berlusconi adviser Bruno Ermolli may form a group to bid for Alitalia, Bloomberg News says, citing an unsourced Il Messaggero report. According to Il Messaggero, AirOne will own 40% of the bidding vehicle, the banks will control 40% and Mr. Bruno's group will hold 20%. Mr. Berluconi has been insisting that an Italian consortium will present a binding offer for Italy's 49.9% stake in Alitalia in less than a month. About Alitalia Headquartered in Rome, Italy, Alitalia S.p.A. -- http://www.alitalia.it/-- provides air travel services for passengers and air transport of cargo on national, international and inter-continental routes, including United States, Canada, Japan and Argentina. The Italian government owns 49.9% of Alitalia. Despite a EUR1.4 billion state-backed restructuring in 1997, Alitalia posted net losses of EUR256 million and EUR907 million in 2000 and 2001 respectively. Alitalia posted EUR93 million in net profits in 2002 after a EUR1.4 billion capital injection. The carrier booked annual net losses of EUR520 million in 2003, EUR813 million in 2004, EUR168 million in 2005, and EUR625.6 million in 2006. Italian Finance Minister Tommaso Padoa-Schioppa had said that if