/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/090302.mbx T R O U B L E D C O M P A N Y R E P O R T E R E U R O P E Monday, March 2, 2009, Vol. 10, No. 42 Headlines A U S T R I A A. & H. LOACKER: Claims Registration Period Ends March 16 FUERNSINN-BAUW LLC: Claims Registration Period Ends March 16 GERHARD SCHAPFL: Claims Registration Period Ends March 16 PARTL LLC: Claims Registration Period Ends March 10 REISEN UND FREIZEITORGANISATION: Claims Period Ends March 10 SIEGLS CAFE: Claims Registration Period Ends March 16 B U L GA R I A KREMIKOVTZI AD: Smart Holding Withdraws Acquisition Talks D E N M A R K AMAGERBANKEN A/S: Moody's Cuts Financial Strength Rating to 'D-' FIONA BANK: Moody's Downgrades Financial Strength Rating to 'E' F I N L A N D STORA ENSO: S&P Changes Outlook to Negative; Affirms 'BB+' Rating G E R M A N Y ANTEGA GRUNDBESITZ: Claims Registration Period Ends April 2 BLITZSCHUTZ UND ELEKTRO: Claims Registration Ends March 30 CITY CLEANING: Claims Registration Period Ends April 9 DUERR AG: Moody's Reviews 'B1' Rating for Possible Downgrade HERTIE GMBH: German State Mulls Loan Guarantee SM VERWALTUNGS: Claims Registration Period Ends April 18 WEINBOERSE ERLEBNIS: Claims Registration Period Ends April 27 * GERMANY: Unemployed Reaches 3.31 Million in February G R E E C E HELLAS TELECOMMUNICATIONS: Moody's Junks Corporate Family Rating I R E L A N D ANGLO IRISH: Fitch Cuts Rating on GBP300 Million Shares to 'C' I T A L Y IT HOLDING: In Bankruptcy Following Subsidiary's Collapse SAFILO SPA: Fitch Puts 'B' Issuer Default Rating on Negative Watch K A Z A K H S T A N COMSER LLP: Creditors Must File Claims by April 10 DYNASTY NETWORK: Creditors Must File Claims by April 10 IRTYSH AGRO CJSC: Creditors Must File Claims by April 10 KAZ GEO SERVICE: Creditors Must File Claims by April 10 KAZKOMMERTS: Moody's Cuts Ratings on 7 Series of Notes to 'Ba3' KOKSHE RELIZ: Creditors Must File Claims by April 10 KOKSHE SHINA: Creditors Must File Claims by April 10 KSM SERVICE XXI LLP: Creditors Must File Claims by April 10 RBK TECHNOLOGIES: Creditors Must File Claims by April 10 RG BRANDS: Moody's Reviews 'B2' Corporate Rating for Possible Cut SERVICE TELECOM: Creditors Must File Claims by April 10 SIVRES LTD: Creditors Must File Claims by April 10 * Moody's Lowers Ratings on 15 Kazakh Financial Institutions K Y R G Y Z S T A N ORIENT TRANS: Creditors Must File Claims by March 20 L U X E M B O U R G LECTA SA: S&P Changes Outlook to Negative; Affirms 'B+' Rating N E T H E R L A N D S CARLSON WAGONLIT: Moody's Cuts Corporate Family Rating to 'B2' NXP BV: S&P Affirms Issue Rating on Senior Secured Notes at 'CCC' R U S S I A EKO-STROY LLC: Creditors Must File Claims by April 22 INDO-RUS-MANUFAKTURA LLC: Creditors Must File Claims by March 22 MIRAX GROUP: Recent Exchange Offer Cues Moody's Junk Rating PLAST-FORM PLANT LLC: Creditors Must File Claims by April 22 RAPSOD TRADE: S&P Junks Corporate Credit Rating From 'B-' SEVERO-ZAPAD OJSC: Creditors Must File Claims by April 22 SOKOLNIKI OJSC: Creditors Must File Claims by April 22 STROY-MASH PLANT LLC: Creditors Must File Claims by April 22 STROITELNOE UPRAVLENIE: Creditors Must File Claims by April 22 TEKH-STROY LLC: Creditors Must File Claims by April 22 TEKHNO-POLIMER LLC: Creditors Must File Claims by March 22 VELES LLC: Creditors Must File Claims by April 22 * Moody's Cuts Local Currency Deposit Ratings on 8 Russian Banks * TOMSK OBLAST: S&P Downgrades Long-Term Issuer Rating to 'B-' S L O V A K R E P U B L I C TERMMING AS: Moody's Withdraws 'Ba1' Long-Term National Rating S L O V E N I A STS: Siemens Launches Liquidation Proceedings; 320 Jobs at Risk S P A I N CEMEX SAB: Fitch Assigns 'BB' Rating on Dollar-Denominated Bond CEMEX SAB: S&P Retains Negative Watch on 'BB+' Corporate Rating S W I T Z E R L A N D HYUNDAI SUISSE: Creditors Must File Proofs of Claim by March 31 INVESLINK LLC: Deadline to File Proofs of Claim Set March 31 KUPAT BETEILIGUNG: Creditors Have Until March 14 to File Claims LOTHOS JSC: Proof of Claim Filing Deadline is April 8 MAKUMED JSC: Creditors' Proofs of Claim Due by March 18 SCHELLENBERG HOLDING: April 14 Set as Deadline to File Claims SEMA SERVICE: Creditors Must File Proofs of Claim by March 13 T U R K E Y FINANSAL KIRALAMA: Fitch Affirms Issuer Default Rating at 'BB' U K R A I N E ALDK GROUP: Creditors Must File Claims by March 11 AZOVSTAL JSC: Bad Macroeconomic Environment Cues S&P's Junk Rating BUILDING UNIVERSAL: Court Starts Bankruptcy Procedure CENTRAL EUROPEAN: S&P Cuts Corporate Credit Ratings to 'BB-' DRUZHBA BREAD: Creditors Must File Claims by March 11 MOTORCAR ENTERPRISE 14827: Claims Filing Deadline Set March 11 NIKOLAYEV MANUFACTURES: Creditors Must File Claims by March 12 ORGTEKS LLC: Creditors Must File Claims by March 13 SERBKA AGRICULTURAL: Creditors Must File Claims by March 12 STIL LLC: Court Starts Bankruptcy Supervision Procedure VINNITSA SOUTH: Court Starts Bankruptcy Supervision Procedure * Moody's Reviews Ratings on Republic of Ukraine for Likely Cuts * Moody's Reviews 'B1' Issuer Ratings of Three Ukrainian Cities U N I T E D K I N G D O M ARNGROVE GROUP: Appoints Administrators from Grant Thornton BRAPACK LTD: Taps Joint Administrators from Tenon Recovery CASTLEMORE SECURITIES: Goes Into Administration; 700 Jobs at Risk EDWARDS GROUP: S&P Puts 'B+' Corp. Credit Rating on Negative Watch KW LINFOOT: Goes Into Administration NIGEL ESTATE: Closes Eight Sales Offices; 18 Jobs Affected PACKAGING FACTORY: Goes Into Administration; 30 Jobs At Risk PROPINVEST: Debt Restructuring May Be Delayed ROYAL BANK: U.K. Gov't Agrees to Provide Additional Funding WINDCROWN LTD: Taps Joint Administrators from PKF WINDERMERE XIV: S&P Lifts Ratings on Class E and F Notes to 'BB' * U.K.: Economy Shrinks 1.5% in the Fourth Quarter * S&P Takes Rating Actions on 368 European Synthetic CDO Tranches * Fitch Says 2009 Challenging Year for European Luxury Goods Firms * BOND PRICING: For the Week Feb. 23 to Feb. 27, 2009 ********* ============= A U S T R I A ============= A. & H. LOACKER: Claims Registration Period Ends March 16 --------------------------------------------------------- Creditors owed money by LLC A. & H. Loacker (FN 63233s) have until March 16, 2009, to file written proofs of claim to the court- appointed estate administrator: Juergen Nagel Rheinstrasse 35 6900 Bregenz Austria Tel: 05574/84003 Fax: 05574/84003-33 E-mail: juergen@eberle-nagel.com Creditors and other interested parties are encouraged to attend the creditors' meeting at 10:10 a.m. on March26, 2009, for the examination of claims at: Land Court of Feldkirch Room 45 First Floor Austria Headquartered in Koblach, Austria, the Debtor declared bankruptcy on Feb. 9, 2009, (Bankr. Case No. 14 S 7/09f). FUERNSINN-BAUW LLC: Claims Registration Period Ends March 16 ------------------------------------------------------------ Creditors owed money by LLC Fuernsinn-Bauw (FN 188583d) have until March 16, 2009, to file written proofs of claim to the court- appointed estate administrator: Dr. Martina Withoff Hauptplatz 5 3910 Zwettl Austria Tel: 02822/52417 Fax: 02822/52417-4 E-mail: dr.withoff@aon.at Creditors and other interested parties are encouraged to attend the creditors' meeting at 8:30 a.m. on April 1, 2009, for the examination of claims at: Land Court of Krems an der Donau (129) Hall A Second Floor Austria Headquartered in Gmuend, Austria, the Debtor declared bankruptcy on Feb. 3, 2009, (Bankr. Case No. 9 S 7/09s). GERHARD SCHAPFL: Claims Registration Period Ends March 16 --------------------------------------------------------- Creditors owed money by KEG Gerhard Schapfl (FN 145248a) have until March 16, 2009, to file written proofs of claim to the court-appointed estate administrator: Dr. Edwin Schubert Triester Strasse 21 2620 Neunkirchen Austria Tel: 02635/62 6 11 Fax: 02635/62 6 11 13 E-mail: ra-e.schubert@aon.at Creditors and other interested parties are encouraged to attend the creditors' meeting at 9:30 a.m. on April 2, 2009, for the examination of claims at: Land Court of Wiener Neustadt (239) Room 15 Wiener Neustadt Austria Headquartered in Ternitz, Austria, the Debtor declared bankruptcy on Feb. 16, 2009, (Bankr. Case No. 10 S 13/09d). PARTL LLC: Claims Registration Period Ends March 10 --------------------------------------------------- Creditors owed money by LLC Partl (FN 253712g) have until March 10, 2009, to file written proofs of claim to the court- appointed estate administrator: Gottfried Tazol Muenzgasse 3 9100 Voelkermarkt Austria Tel: 04232/2520 Fax: 04232/2520-20 E-mail: office@ra-rack-tazol.at Creditors and other interested parties are encouraged to attend the creditors' meeting at 10:30 a.m. on March 17, 2009, for the examination of claims at: Land Court of Klagenfurt (729) Room 225 Klagenfurt Austria Headquartered in Eberndorf, Austria, the Debtor declared bankruptcy on Feb. 6, 2009, (Bankr. Case No. 40 S 9/09b). REISEN UND FREIZEITORGANISATION: Claims Period Ends March 10 ------------------------------------------------------------ Creditors owed money by LLC Reisen und Freizeitorganisation (FN 241116h) have until March 10, 2009, to file written proofs of claim to the court-appointed estate administrator: Dr. Kurt Weinreich Josefstrasse 13 3100 St. Poelten Austria Tel: 02742/72 222 Fax: 02742/72 222-10 E-mail: kanzlei@tws-rae.at Creditors and other interested parties are encouraged to attend the creditors' meeting at 10:10 a.m. on March 31, 2009, for the examination of claims at: Land Court of St. Poelten (199) Room 216 St. Poelten Austria Headquartered in St. Poelten, Austria, the Debtor declared bankruptcy on Feb. 2, 2009, (Bankr. Case No. 14 S 19/09y). SIEGLS CAFE: Claims Registration Period Ends March 16 ----------------------------------------------------- Creditors owed money by LLC Siegls Cafe (FN 32032g) have until March 16, 2009, to file written proofs of claim to the court- appointed estate administrator: Dr. Guenther Csar Hauptplatz 35 2700 Wiener Neustadt Austria Tel: 02622-23433 Fax: 02622-23433-22 E-mail: ra.drcsar@adis.at Creditors and other interested parties are encouraged to attend the creditors' meeting at 10:30 a.m. on March 26, 2009, for the examination of claims at: Land Court of Wiener Neustadt (239) Room 15 Wiener Neustadt Austria Headquartered in Wiener Neustadt, Austria, the Debtor declared bankruptcy on Feb. 6, 2009, (Bankr. Case No. 10 S 11/09k). ============== B U L GA R I A ============== KREMIKOVTZI AD: Smart Holding Withdraws Acquisition Talks --------------------------------------------------------- Sabina Zawadzki and Irina Ivanova at Reuters report that Ukraine- based steel company Smart Holding has decided to withdraw from talks over the purchase of Kremikovtzi AD, citing lack of support among the mill's creditors. Reuters relates according to Smart Holding, majority of Kremikovtzi's creditors were against its restructuring plan for the mill, although it noted the Bulgarian government's position was "constructive". Smart Holdings said it had proposed an investment plan worth EUR220 million (US$281.9 million) and a US$60 million loan, while offering to pay back debt worth EUR80 million across three years and turn the rest of the mill's debts into shares, Reuters discloses. About Kremikovtzi Headquartered in Sofia, Bulgaria, Kremikovtzi AD -- http://www.kremikovtzi.com/-- is a single-site steel producer in Bulgaria that reported BGN896 million in revenues in 2006. It explores and produces iron and ore fields. As reported in the TCR-Europe on Aug. 8, 2008, the Sofia City Court commenced insolvency proceedings against Kremikovtzi AD after declaring it bankrupt. The court appointed a temporary bankruptcy administrator for the steelmaker. The court also ruled that Kremikovtzi's insolvency started on Dec. 31, 2005. As of Dec. 31, 2007, the company had BGN1.63 billion (US$1.3 billion) in total debts. ============= D E N M A R K ============= AMAGERBANKEN A/S: Moody's Cuts Financial Strength Rating to 'D-' ---------------------------------------------------------------- Moody's Investors Service has downgraded the bank financial strength rating (BFSR) of Amagerbanken A/S to D- from C-. The bank's long-term deposit rating was downgraded to Baa2. The short-term deposit rating of Prime-2 was affirmed. The outlook on the BFSR and long-term deposit rating is negative. The downgrades were prompted by Moody's view that Amagerbanken's financial strength has weakened following a rapid deterioration in its asset quality and that further weakening is likely. The scale of deterioration has been more pronounced than Moody's had anticipated at the time of the previous rating action in November when the BFSR and the deposit rating were downgraded to C- and A3, respectively. The downgrade of the BFSR to D- takes account of the further decline in Amagerbanken's profitability and pressure on its capital adequacy. Moody's believes, based on its loss expectations for the bank's loan portfolio, that capital could potentially erode to levels consistent with a BFSR in the D range. As a result of adverse developments in its property and investment credit exposures, the bank increased loan loss provisions significantly in the fourth quarter of 2008. Problem loans (defined as individually impaired loans) accounted for 4.9% of gross loans and guarantees at the end of 2008, in comparison with about 1% at end-2007. Amagerbanken continues to display a high exposure to the Danish real estate sector, which has experienced challenging conditions since mid-2008. With property finance accounting for 36% of the bank's total lending at end-2008, the portfolio exhibits significant concentration risk. In light of current conditions, Moody's has concerns about the viability of the bank's business model related to property finance given the adverse developments in this sector. In addition, about 10% of loans are investment credits, which are also likely to remain under pressure given the downturn in the markets. As regards the bank's capitalization, its solvency ratio was 10.3% at year-end 2008, which remains above the regulatory minimum requirement of 8%. However, Moody's cautions that any increase in credit risk could exert additional pressure on capitalization. The rating agency also notes that the individual solvency requirement which is set by the board of directors has not been published and could be higher than the regulatory minimum. Amagerbanken's Baa2 long-term deposit rating incorporates a four- notch uplift from the bank's Ba3 Baseline Credit Assessment (the measure of its standalone financial strength that maps from its D- BFSR). This takes into account Moody's expectation that systemic support for Amagerbanken would be forthcoming if needed including the measures available under the state company Finansiel Stabilitet established by the Danish government. The negative outlook on Amagerbanken's ratings reflects Moody's concern that the bank's credit quality may continue to deteriorate further, especially given the adverse developments in the property sector in Denmark and the continuing downturn in the securities market. Moody's therefore believes that Amagerbanken's profitability will continue to face increasing challenges, which could weigh on its solvency measures. Moody's last rating action on Amagerbanken was on November 4, 2008, when the BFSR was downgraded to C- from C. At the same time, the bank's long-term deposit rating was downgraded to A3 from A1 and the short-term deposit rating to Prime-2 from Prime-1. The outlook on the BFSR and long-term rating remained negative. Headquartered in Copenhagen, Denmark, Amagerbanken reported total assets of DKK35.7 billion (EUR4.8 billion) at end--December 2008. FIONA BANK: Moody's Downgrades Financial Strength Rating to 'E' --------------------------------------------------------------- Moody's Investors Service has downgraded the bank financial strength rating of Fionia Bank A/S to E from D- and the subordinated debt rating to C from B1. The long-term debt and deposit ratings were confirmed at A3 and short-term deposit rating at Prime-2 reflecting the transfer of these senior unsecured liabilities to the new bank under the government scheme. The backed Aaa rating assigned to a bond that matures within the period of the guarantee scheme established by the Danish government was affirmed. The outlook on all ratings is stable. The rating action -- which concludes the rating review initiated on December 10, 2008 -- follows Fionia Bank's announcement that it has entered into a framework agreement with the state company Afviklingsselskabet til sikring af finansiel stabilitet A/S referred to as Finansiel Stabilitet (Financial Stability) whereby Fionia Bank will establish a new bank (not rated) to which it will transfer all of its assets and liabilities except equity and subordinated capital. Fionia Bank remains the majority owner of the new bank but its shareholding will be pledged with Finansiel Stabilitet, which will inject subordinated or hybrid capital into the new bank. The intervention of the authorities was prompted by the deteriorated financial condition of the bank. Fionia Bank's total capital ratio at year-end 2008 was 8.3%, which is well below the individual solvency requirement of 11.5% set by the bank's Board of Directors. The agreement with Finansiel Stabilitet is subject to approval from the Danish FSA and the EU and competition authorities. The E BFSR -- the lowest possible rating on Moody's scale -- reflects Moody's understanding that, following the transfer of its assets and senior liabilities, Fionia Bank will cease its banking operations and will consequently hand in its banking licence. It will remain as a holding company owning the shares in the new bank and its name is planned to be changed to Fionia Bank Holding A/S. Fionia Bank's financial strength has deteriorated rapidly since summer 2008 and, in particular, reflects problems with its real estate-related exposures. Moody's also believes that the bank's franchise has been impaired given the recent events. The confirmation of the deposit and senior debt ratings is underpinned by the fact that the liabilities including deposits and senior debt will be transferred to a new bank that will be controlled by the government-owned company, Finansiel Stabilitet. This company was created as part of Denmark's first banking support package introduced in October 2008. The guarantee scheme covers the senior claims of participating banks until September 30, 2010. The downgrade of Fionia Bank's subordinated debt rating under the MTN program to C from B1 follows the decision not to transfer these liabilities to the new bank. Any compensation to the holders of subordinated debt is uncertain and would be payable only after Finansiel Stabilitet has received interest on its injected capital. Moody's notes, however, that Fionia Bank does not have any subordinated debt outstanding under the rated MTN program. Moody's will consider withdrawing the BFSR, debt and deposit ratings once Fionia Bank hands in its banking license. Moody's last rating action on Fionia Bank was on December 10, 2008, when the BFSR was downgraded to D- and the subordinated rating to B1 following the bank's announcement of increased impairments and a significant decrease in capital ratios. All the ratings were also placed on review for possible downgrade. Headquartered in Odense, Denmark, Fionia Bank reported total assets of DKK30.5 billion (EUR4.1 billion) at end-September 2008. ============= F I N L A N D ============= STORA ENSO: S&P Changes Outlook to Negative; Affirms 'BB+' Rating ----------------------------------------------------------------- Standard & Poor's Ratings Services said that it revised its outlook on Finland-based forest product company Stora Enso Oyj to negative from stable. At the same time, the 'BB+' long-term and 'B' short-term issuer credit and debt ratings were affirmed. "The outlook revision reflects the increased risk of a downgrade, in light of Stora Enso's underperformance relative to S&P's expectations for a 'BB+' rating in 2008, a downward revision of S&P's financial base-case scenario for the company and the increased likelihood of a weaker stress case scenario, and a possible adverse revision of the company's business risk score," said Standard & Poor's credit analyst Andreas Zsiga. S&P anticipates that the rapidly weakening economic environment will massively pressure paper demand. This would temper potential price increases and curb the positive impact of lower costs. As a result, Stora Enso's medium-term financial profile could recover more slowly from its current level. Further adverse changes in S&P's economic forecast or paper market prospects for the next few months could trigger a downgrade. S&P could revise the outlook back to stable if improvements in Stora Enso's financial performance become more likely. This would include more certainty that demand could fall only 5% in 2009 and be stable in 2010, as well as margin and cash generation improvement resulting from a combination of price increases and cost reductions. At the current rating level, S&P would normally expect to see FFO to debt gradually improve toward 20% in the short term and 25% in the medium term. S&P would also anticipate free operating cash flow that is positive by some EUR300 million annually. ============= G E R M A N Y ============= ANTEGA GRUNDBESITZ: Claims Registration Period Ends April 2 ----------------------------------------------------------- Creditors of Antega Grundbesitz GmbH have until April 2, 2009, to register their claims with court-appointed insolvency manager. Creditors and other interested parties are encouraged to attend the meeting at 2:30 p.m. on April 16, 2009, at which time the insolvency manager will present his first report. The meeting of creditors will be held at: The District Court Erfurt Hall 12 Judicial Center Rudolfstr. 46 99092 Erfurt Germany Claims set out in the insolvency manager's report will be verified by the court during this meeting. Creditors may also constitute a creditors' committee or opt to appoint a new insolvency manager. The insolvency manager can be reached at: Rolf Rombach Magdeburger Allee 159 99086 Erfurt Germany The District Court opened bankruptcy proceedings against the company on Feb. 16, 2009. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be reached at: Antega Grundbesitz GmbH Attn: Klaus Nuerck, Manager Konrad-Zuse-Str. 12 99099 Erfurt Germany BLITZSCHUTZ UND ELEKTRO: Claims Registration Ends March 30 ---------------------------------------------------------- Creditors of Blitzschutz und Elektro GmbH have until March 30,2 009, to register their claims with court-appointed insolvency manager. Creditors and other interested parties are encouraged to attend the meeting at 11:10 a.m. on April 21, 2009, at which time the insolvency manager will present his first report. The meeting of creditors will be held at: The District Court of Gera Room 317 Rudolf-Diener-Str. 1 Gera Germany Claims set out in the insolvency manager's report will be verified by the court during this meeting. Creditors may also constitute a creditors' committee or opt to appoint a new insolvency manager. The insolvency manager can be reached at: Dr. D. Herzig Promenadenstr. 3 09111 Chemnitz Germany The District Court opened bankruptcy proceedings against the company on Feb. 16, 2009. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be reached at: Blitzschutz und Elektro GmbH Attn: Dieter Daube, Manager Mozartstrasse 5 04600 Altenburg Germany CITY CLEANING: Claims Registration Period Ends April 9 ------------------------------------------------------ Creditors of City Cleaning Hamburg GmbH have until April 9, 2009, to register their claims with court-appointed insolvency manager. Creditors and other interested parties are encouraged to attend the meeting at 9:05 a.m. on May 13, 2009, at which time the insolvency manager will present his first report. The meeting of creditors will be held at: The District Court of Hamburg Hall B 405 Fourth Floor Annex Civil Justice Bldg. Sievkingplatz 1 20355 Hamburg Germany Claims set out in the insolvency manager's report will be verified by the court during this meeting. Creditors may also constitute a creditors' committee or opt to appoint a new insolvency manager. The insolvency manager can be reached at: Karsten Toetter Gertrudenstrasse 3 20095 Hamburg Germany The District Court opened bankruptcy proceedings against the company on Feb. 16, 2009. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be reached at: City Cleaning Hamburg GmbH Attn: Rafael Espinosa, Manager Ahrensburger Strasse 164 p 22045 Hamburg Germany DUERR AG: Moody's Reviews 'B1' Rating for Possible Downgrade ------------------------------------------------------------ Moody's Investors Service has placed Duerr's B1 corporate family rating and B3 bond rating under review for possible downgrade. Rainer Neidnig, lead analyst at Moody's for Duerr, said: "The rating action was triggered by the unexpected steep decline in order intake in Q4/2008 and reflects Moody's concern that weak order intake could potentially continue over 2009 resulting in pressure on earnings and cash flow. As a result financial ratios might weaken to levels no longer commensurate with a B1 rating and headroom under financial covenants might tighten significantly during 2009". Hence, the review will focus in particular on the company's ability to restore comfortable headroom under financial covenants and on the expected development of order intake, sales and earnings for 2009. On February 19, 2009, Duerr announced preliminary results for fiscal 2008. While 2008 as a whole was still a record year with EUR1.6 billion in sales and reported EBIT of EUR73 million, order intake in Q4/2008 slumped to EUR187 million which compares to EUR474 million in Q4/2007. While Moody's notes that order intake in Q4/2007 was extraordinarily strong -- including a large order from BMW -- Moody's are concerned that the weak order intake could continue over 2009. This view also considers that Duerr's largest customer segment is still the automotive industry which is currently going through a severe downturn. Although Moody's acknowledges that Duerr's by now substantial service activities should prove to be fairly resilient through the current downturn, Moody's caution that lower business activity in the new equipment segment could place a substantial burden on revenues and earnings. Moreover, Moody's notes that lower order intake could also result in lower prepayments and hence negatively impact cash flow generation and the group's net debt position. As a result Moody's sees the risk that financial ratios could deteriorate over 2009 to levels below what would be expected for the current B1 rating. In order to remain positioned within the B1 rating category Moody's would expect Duerr to achieve financial ratios such as EBITA margins not falling below 3% or Debt/EBITDA not to increase to 4.5x or higher. Besides cash on hand (app. EUR90 million per year end 2008) and cash flow from operations, Duerr's major funding source is the company's EUR200 million syndicated credit facility. In Moody's view these sources should, in total, provide for an adequate 12- months liquidity position to cover funding needs which are expected to arise mainly from working capital, capex and dividends. However, Moody's cautions that Duerr's core credit facility agreement contains conditionality language in form of financial covenants and headroom is expected to tighten significantly in light of the difficult operating environment over 2009. Management plans to address this covenant pressure and establish more comfortable headroom is one focus of the rating review. On Review for Possible Downgrade: Issuer: Duerr AG -- Probability of Default Rating, Placed on Review for Possible Downgrade, currently B1 -- Corporate Family Rating, Placed on Review for Possible Downgrade, currently B1 -- Senior Subordinated Regular Bond/Debenture, Placed on Review for Possible Downgrade, currently B3, LGD6, 91% Outlook Actions: Issuer: Duerr AG -- Outlook, Changed To Rating Under Review From Stable Moody's last rating action on Duerr was to upgrade the corporate family ratings to B1 (stable outlook) from B2 (positive outlook) on September 15, 2008. Headquartered in Stuttgart, Germany, Duerr is a leading plant and mechanical engineering group with 47 locations in 21 countries. The group generates about 85% of revenues with automobile manufacturers and their suppliers but increasingly supplies sectors such as aviation, mechanical engineering, chemical, pharmaceutical or printing. Duerr's product offering includes paint shops, assembly systems, balancing and diagnostic systems, industrial cleaning systems and related services. The group holds strong market positions in all of its activities, e.g. a 40% global market share in paint shops and painting lines which account for approximately half of the group's revenues. In 2008, Duerr recorded revenues of EUR1.6 billion with about 6,000 employees. HERTIE GMBH: German State Mulls Loan Guarantee ---------------------------------------------- Nikola Rotscheroth and Eva Kuehnen at Reuters report that the German state of North Rhine Westphalia said Wednesday it may give a loan guarantee to Hertie GmbH. Reuters relates that after talks with Hertie's administrator and potential investors for the company, the regional ministry of economics said the investors would make a loan application as soon as possible, which it would then process quickly. It did not disclose details of the size of the guarantee needed or names of investors, Reuters notes. However, German retail association HDE, as cited by the report, said the state aid was not a solution and would disrupt sector competition. "We in the retail industry have never called the state for help, in contrast to the banking and automotive industry," Reuters quoted the HDE spokesman as saying. As reported in the TCR-Europe on Aug. 6, 2008, Hertie GmbH filed for commencement of insolvency proceedings at the District Court of Essen on July 31, 2008. The court appointed Biner Baehr of White & Case LLP as preliminary insolvency administrator for Hertie. According to Bloomberg News, Hertie filed for insolvency after its debt-restructuring talks failed. Hertie Warenhandels GmbH, one of Hertie's units, filed for opening of insolvency proceedings on Aug. 1, 2008. Mr. Baehr was also appointed preliminary insolvency administrator for that unit. Erik van Heuven, Hertie's chief marketing officer, told Bloomberg News that Hertie will revive the concept of neighborhood department-stores as part of its restructuring. Based in Essen, Germany, Hertie GmbH -- http://www.hertie.de/-- operates 73 department stores and employs 4,100 people. Hertie posted EUR30 million in losses on EUR540 million in sales for financial year 2007. SM VERWALTUNGS: Claims Registration Period Ends April 18 -------------------------------------------------------- Creditors of SM Verwaltungs GmbH have until April 18l, 2009, to register their claims with court-appointed insolvency manager. Creditors and other interested parties are encouraged to attend the meeting at 10:45 a.m. on May 12, 2009, at which time the insolvency manager will present his first report. The meeting of creditors will be held at: The District Court of Bad Kreuznach Hall A4 Hofgartenstr. 2 55545 Bad Kreuznach Germany Claims set out in the insolvency manager's report will be verified by the court during this meeting. Creditors may also constitute a creditors' committee or opt to appoint a new insolvency manager. The insolvency manager can be reached at: Dr. Jur. Wolfgang Maus Mannheimer Str. 254a D 55543 Bad Kreuznach Germany Tel: 0671-79496-13 Fax: 0671-79496-10 The District Court opened bankruptcy proceedings against the company on Feb. 13, 2009. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be reached at: SM Verwaltungs GmbH Attn: Sven Malz, Manager Johannisgarten 3 55546 Frei-Laubersheim Germany WEINBOERSE ERLEBNIS: Claims Registration Period Ends April 27 ------------------------------------------------------------- Creditors of Weinboerse Erlebnis & Genuss Handelsgesellschaft mbH have until April 27, 2009, to register their claims with court- appointed insolvency manager. Creditors and other interested parties are encouraged to attend the meeting at 10:00 a.m. on May 8, 2009, at which time the insolvency manager will present his first report. The meeting of creditors will be held at: The District Court of Krefeld Meeting Room H 131 Nordwall 131 47798 Krefeld Germany Claims set out in the insolvency manager's report will be verified by the court during this meeting. Creditors may also constitute a creditors' committee or opt to appoint a new insolvency manager. The insolvency manager can be reached at: Wilhelm Klaas Eichendorffstrasse 25 47800 Krefeld Germany The District Court opened bankruptcy proceedings against the company on Feb. 15, 2009. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be reached at: Weinboerse Erlebnis & Genuss Handelsgesellschaft mbH Suedwall 20-22 47798 Krefeld Germany Attn: Uwe Siegel, Manager Minkweg 18 47803 Krefeld Germany * GERMANY: Unemployed Reaches 3.31 Million in February ------------------------------------------------------ Adjusted jobless rate in Germany rose to 7.9 percent in February from 7.8 percent, Rainer Buergin at Bloomberg News reports. The report relates data from the Nuremberg-based Federal Labor Agency showed the number of people out of work rose a seasonally adjusted 40,000 to 3.31 million. In unadjusted terms, the number of jobless increased by 63,121 in February, report says. "German unemployment has not risen as sharply as elsewhere in the euro zone, but surveys of hiring intentions point to much worse to come," Ben May, an economist at Capital Economics in London, was quoted by the news agency as saying. According to the report, some German companies are reducing working hours before cutting jobs after the government said it would cover companies' social-insurance payments for workers put on short time. Companies in February announced they're planning to add 600,000 workers to those already working shortened shifts, Bloomberg News cited Labor Agency head Frank-Juergen Weise as saying during an interview with Bloomberg Television. The report discloses according to a survey of 25,000 companies by the DIHK chambers of trade and industry, the share of German companies planning to cut jobs rose to 30 percent in January from 18 percent in October. =========== G R E E C E =========== HELLAS TELECOMMUNICATIONS: Moody's Junks Corporate Family Rating ---------------------------------------------------------------- Moody's Investors Service has downgraded the Corporate Family Rating of Hellas Telecommunications II S.a.r.l. to Caa1 from B3 as well as the ratings on the existing debt instruments issued by its subsidiaries as detailed below. Hellas Telecommunications II is a holding company of Wind Hellas Telecommunications. The outlook on the ratings is negative. The ratings affected are: -- Corporate Family Rating at Hellas Telecommunications II downgraded to Caa1 from B3 -- Senior secured notes issued at Hellas Telecommunications (Luxembourg) V downgraded to B3 from B2 -- Senior notes issued at Hellas Telecommunications (Luxembourg) III downgraded to Caa2 from Caa1 -- Subordinated notes issued at Hellas Telecommunications II S.a.r.l. downgraded to Caa3 from Caa2. The ratings downgrades reflect (i) an acceleration during the fourth quarter of 2008 of the negative trends in operating performance that were identified at the time of the last rating action in November 2008; (ii) the expected full-year impact of these trends in 2009, which could result in a lower EBITDA for Wind Hellas compared to 2008; (iii) limited headroom in the Company's liquidity position for any further weakening in its cash burn expectations targeted by the company at less than EUR50 million for 2009; and (iv) developing concerns over the sustainability of the Company's debt capital structure. Based on the reported annual EBITDA of EUR455 million for Wind Hellas on a standalone basis, the company has under-performed its EBITDA guidance of EUR470 million. Tellas, the company's fixed line business performed modestly better than expected with an EBITDA loss of EUR22 million for 2008. Therefore, its total reported EBITDA of EUR434 million (before one-off items) was lower than the EUR440 million guidance. Moody's is factoring into the rating action the perspective that the company is facing challenging operating conditions in 2009. On January 1, 2009, the termination rate has been significantly reduced and the termination rate asymmetry applicable to Wind Hellas has been eliminated. Wind Hellas publicly estimates a negative EUR25 million impact on the mobile business's EBITDA. Furthermore, the economic environment in Greece has weakened over the course of 2008 and the decrease in usage experienced by Greek mobile operators in Q4 2008 is likely to put further pressure on revenue and EBITDA in 2009. As regards Tellas, the company publicly indicated that it would expect its subsidiary to be EBITDA break even in 2009. Moody's notes the existence of a high degree of execution risk associated with the company's business plan for 2009. In addition to challenges associated with the operating environment, Moody's is concerned about Wind Hellas' tight liquidity profile. As of December 31, 2008, the Company had EUR36.8 million in cash & cash equivalents and EUR50 million of undrawn revolving credit facility availability. It was free cash flow negative in Q4 2008, with a cash burn of approximately EUR20 million. The Company publicly expects negative free cash flow of between EUR0 and EUR50 million during 2009. Furthermore given the company's capex cycle, it will be using cash through working capital absorption during the first half of 2009. Therefore, Moody's believe that the liquidity profile could come under further pressure, particularly during the second quarter of 2009, although the company has indicated that any shortfall could be absorbed by a changing the timing of its capital expenditures. Moody's acknowledges that the company's current strategy is focused on cash preservation to the extent it is feasible for a growing company in a competitive market. The company is also expecting positive cash contributions from the merger with Tellas through the realization of operating synergies, more efficient tax treatment and receipt of government subsidies with a particular benefit noted by management of no tax outflows anticipated for 2009. The negative outlook on the rating reflects (i) Moody's concerns about the sustainability of the current debt structure; and (ii) the high degree of execution risk of the company's business plan associated with achieving its public guidance on free cash flow in light of the planned termination rate reduction and a weakened operating environment. Therefore, liquidity will remain a concern over the next 12 months. The outlook could be stabilized if the company substantially improves the group's liquidity risk profile. The last rating action was on November 28, 2008 when the ratings were downgraded by one notch. Wind Hellas is the third mobile operator in Greece. At the end of 2007, the company acquired Tellas, an alternative fixed line operator. In 2008, the company generated EUR1,269 million in revenues on a consolidated basis. ============= I R E L A N D ============= ANGLO IRISH: Fitch Cuts Rating on GBP300 Million Shares to 'C' -------------------------------------------------------------- Fitch Ratings has downgraded the Long-term rating of Anglo Irish Bank Corporation's (Anglo) GBP300 million preference shares (ISIN no. IE00B085VK31) to 'C' from 'BB-' (BB minus) and removed the rating from Rating Watch Negative. Fitch has simultaneously withdrawn the ratings on the preference shares. Anglo's other Tier 1 hybrid issues, which have a Long-term rating of 'BB-' (BB minus), remain on RWN. The downgrade follows the announcement earlier this month by Ireland's Department for Finance that no further coupon payments will be made on the preference shares. The withdrawal reflects the automatic transfer of ownership of the preference shares to the Minister of Finance. The Department for Finance also announced that Anglo's other Tier 1 hybrid securities are unaffected and that Anglo will continue to service its obligations regarding coupon payments and repayment of principal to holders, subject to Anglo's right to defer coupon payments. Consequently, Fitch has maintained its ratings for these instruments. Anglo's ratings are: -- Long-term IDR: 'A-' (A minus); Outlook Stable -- Short-term IDR: 'F1+' -- Individual Rating: 'F' -- Support Rating: '1' -- Support Rating Floor: 'A-' (A minus) ========= I T A L Y ========= IT HOLDING: In Bankruptcy Following Subsidiary's Collapse --------------------------------------------------------- IT Holding SpA sought bankruptcy protection Thursday last week putting 1,700 jobs at risk, The Associated Press reports. The filing, the AP relates, came two weeks after the company put one of its subsidiaries, Ittierre SpA, into bankruptcy protection. The Financial Times reports Italy's Minister of Economic Development, Mr. Claudio Scajola, said the government was extending bankruptcy protection to IT Holding "to safeguard the group and its ability to continue in business." IT Holding was put into bankruptcy after missing loan installments and failing to pay suppliers and royalties for as much as a year, Bloomberg News says. According to Bloomberg News, IT Holding missed a loan payment in October and an extension three months later. Ratings Downgrade As reported in the Troubled Company Reporter-Europe on Feb. 11, 2009, Moody's Investors Service downgraded IT Holding's Probability of Default Rating to D from Ca. Moody's said the downgrade was prompted by IT Holding's February 9, 2009 decision to place its main operating subsidiary, Ittierre, into administration under the Italian law. On Dec. 26, 2008, the TCR-Europe reported Standard & Poor's Ratings Services lowered its long-term corporate credit rating on IT Holding to 'SD' from 'CC'. S&P's rating actions reflect the announcement by IT Holding on Dec. 22 that it has once again requested a deferral of a EUR9.4 million principal payment on its unrated bank loan. The initial payment fell due Oct. 20, 2008, but the pool of banks had accepted a waiver until Dec. 22. The semiannual coupon on the EUR185 million senior secured notes due Nov. 15, 2008, was paid, S&P noted. Ittierre Bankruptcy Ittierre, IT Holding's main production and licensing unit, filed for protection from its creditors Feb. 9 after banks refused to inject the necessary capital to keep its business keep going, the AP says. Bloomberg News adds Ittierre said it missed loan payments and was late in paying royalties to designers. On Feb. 12, 2009, Minister Scajola accepted the application filed by Ittierre for "Amministrazione Straordinaria" and appointed Mr. Andrea Ciccoli, partner in Bain & Co., Mr. Stanislao Chimenti, lawyer, and Mr. Roberto Spada, Certified Public Accountant, as commissioners. Ittierre Gets Financing The Financial Times relates Ittierre received Feb. 25 a EUR30 million (US$38 million) loan from a consortium of Italian banks. UniCredit SpA, Banca Popolare dell'Emilia Romagna Scrl, Banca Popolare di Milano Scarl, Banco Popolare SC and Intesa Sanpaolo SpA will provide the loan, Ittierre's administrators said in an e- mailed note obtained by Bloomberg News. Cavalli Affected Bloomberg News reports Italian fashion designer Roberto Cavalli canceled a fashion show scheduled Feb. 26 in Milan for the Just Cavalli fall/winter collection, citing the collapse of Ittierre. "I made the decision to safeguard the image and clients of Just Cavalli," the designer said in an e-mailed statement obtained by Bloomberg News. "The difficult situation of Ittierre doesn�t give me the guarantee or security to be able to remain, as always, at the forefront with my youthful line." In a separate report, Bloomberg News says Mr. Cavalli told daily Il Sole 24 Ore in an interview he is owed about EUR20 million (US$26 million) in royalties from Ittierre. Ittiere controls 100% of the Just Cavalli licence, according to The Guardian. Lifeline The AP reports Minister Scajola on Thursday said he would announce the first measures by mid-March to support Italy's fashion industry. About IT Holding SpA Based in Milan, Italy, IT Holding SpA (BIT:ITH) --- http://www.itholding.com/--- operates in the luxury goods market. The company and its subsidiaries design, produce and distribute apparel, accessories, eyewear and perfumes. Its brand portfolio embraces: owned brands, Gianfranco Ferre, Malo, Exte, as well as licensed brands, Versace Jeans Couture, Versace Sport, Just Cavalli, C�N�C Costume National and Galliano. The company's production facilities are located in Italy. IT Holding SpA has a worldwide distribution network, including 39 directly operated stores, 274 monobrand stores and over 6,000 department and specialty stores. In order to be present in the most significant markets, IT Holding SpA has dedicated market companies: ITTIERRE SpA, ITTIERRE France SA, ITTIERRE Moden GmbH, IT USA HOLDING Inc and IT Asia Pacific Limited, among others. SAFILO SPA: Fitch Puts 'B' Issuer Default Rating on Negative Watch ------------------------------------------------------------------ Fitch Ratings has placed the Long-term and Short-term Issuer Default Ratings of Italy-based eyewear designer and manufacturer Safilo S.p.A., which are 'B' respectively, on Rating Watch Negative due to concerns about Safilo's debt repayment schedule and liquidity. Fitch has simultaneously affirmed Safilo's EUR400 million senior credit facilities at 'BB-'(BB minus)/'RR2' and Safilo Capital International S.A.'s EUR195 million senior notes due 2013 at 'B-'(B minus)/'RR5'. The individual Long-term IDR for Safilo Capital International S.A. is affirmed at 'B' and withdrawn. "The Rating Watch Negative reflects the potential weakness in the company's debt profile as the EUR40 million in scheduled amortizations due in 2009 will put pressure on free cash flow, which was already negative in 2008, and on the level of committed liquidity, which has shrunk further to just EUR35 million at December 2008," says Michelle De Angelis, a Senior Director in Fitch's Leveraged Finance team. "Furthermore, the company still needs to agree an amendment to financial covenants on its committed senior facilities, which the agency believes could otherwise be in breach at the June 2009 test date." These issues, which were noted by Fitch in its last rating action in December 2008, have yet to be addressed, and could result in further negative rating action if a resolution is not forthcoming. Fitch notes management's comment that its term loan lenders remain "helpful and co-operative", but the lack of an agreement on covenant amendments to date, and the potential for a multiple notch downgrade should it not be achieved, are reflected in the Rating Watch Negative. The Rating Watch could be resolved if the company successfully addresses the amendments and should FCF generation prove sufficient to address the scheduled amortizations and improve the level of undrawn committed liquidity. However, if covenant amendments are not agreed, or if they are agreed, but the company fails to address its shrinking committed liquidity sources or relies to an increasing extent on uncommitted liquidity sources, Safilo's ratings could be downgraded. In 2008 the company generated free cash flow before dividends and debt drawdowns/repayments of negative EUR32 million, of which a net EUR25 million was spent on the acquisition of two retail chains. Generation of positive free cash flow to cover the upcoming debt amortizations of EUR40 million in 2009 (split between June and December) will be dependent on the company's success in managing working capital, its dividend distribution policy, the cost of production rationalization measures, capital expenditure and the level of EBITDA generated for 2009. EBITDA for the full year 2008 was in line with the agency's expectations at EUR126 million, a reduction of 28% year-on-year. As a result of this decline, Fitch estimates that lease-adjusted net leverage reached 5.1x at FYE08, up sharply from 4.0x at Q208 and 3.5x at FYE07. Fitch anticipates still lower EBITDA levels in 2009 and potentially static debt levels. Given Safilo's strong competitive position as one of two leading global eyewear companies, and its impressive brand portfolio, the current level of leverage could potentially be accommodated within the 'B' rating. However as noted above, this would also be dependent on a more sustainable, back-ended committed debt repayment profile. =================== K A Z A K H S T A N =================== COMSER LLP: Creditors Must File Claims by April 10 -------------------------------------------------- The Specialized Inter-Regional Economic Court of Karaganda has declared LLP Comser insolvent. Creditors have until April 10, 2009, to submit written proofs of claim to: The Specialized Inter-Regional Economic Court of Karaganda Alalykin Str. 9 Karaganda Kazakhstan DYNASTY NETWORK: Creditors Must File Claims by April 10 ------------------------------------------------------- The Specialized Inter-Regional Economic Court of Almaty has declared LLP Dynasty Network insolvent. Creditors have until April 10, 2009, to submit written proofs of claim to: Buhar-Jyrau Str. 50a-32 Almaty Kazakhstan Tel: 8 777 689 11-10 The Court is located at: The Specialized Inter-Regional Economic Court of Almaty Baizakov Str. 273b Almaty Kazakhstan IRTYSH AGRO CJSC: Creditors Must File Claims by April 10 -------------------------------------------------------- CJSC Irtysh Agro has declared insolvency. Creditors have until April 10, 2009, to submit written proofs of claim to: Torgovaya Str. 11 140000 Pavlodar Pavlodar Kazakhstan KAZ GEO SERVICE: Creditors Must File Claims by April 10 ------------------------------------------------------- LLP Kaz Geo Service has declared insolvency. Creditors have until April 10, 2009, to submit written proofs of claim to: Satpayev Str. 18-14 Aktobe Aktube Kazakhstan KAZKOMMERTS: Moody's Cuts Ratings on 7 Series of Notes to 'Ba3' --------------------------------------------------------------- Moody's Investors Service has downgraded these series of notes issued by Kazkommerts DPR Company. This rating action follows Moody's rating action on the ratings of Kazkommertsbank on February 24, 2009 and concludes the review of the transaction following the rating action on December 12, 2008, during which these series of notes were placed on review for possible downgrade. -- US$50,000,000 Series 2005-B Floating Rate Notes due 2012, from Baa3 to Ba3 -- US$150,000,000 Series 2007-A Floating Rate Notes due 2017, from Baa3 to Ba3 Moody's has also downgraded the underlying rating reflecting the risk posed to the providers of the financial guarantees in relation to these series of notes from Baa3 to Ba3 (for the avoidance of doubt, these underlying ratings do not take the benefit of the related financial guarantees into account and the ratings of the notes, which incorporate the support of such guarantees, are unaffected by this rating action). -- US$200,000,000 Series 2005-A Floating Rate Notes due 2012, from Baa3 to Ba3 -- US$100,000,000 Series 2006-A Floating Rate Notes due 2013, from Baa3 to Ba3 -- US$100,000,000 Series 2006-B Floating Rate Notes due 2013, from Baa3 to Ba3 -- US$250,000,000 Series 2007-B Floating Rate Notes due 2017, from Baa3 to Ba3 -- US$100,000,000 Series 2007-C Floating Rate Notes due 2017, from Baa3 to Ba3 The rating action reflects Moody's downgrade of Kazkommertsbank's global local currency deposit rating from Ba1 to Ba3 and its foreign currency senior unsecured debt rating from Ba1 to Ba3 on February 24, 2009. In March 2008, the transaction has been amended to include structural protections to achieve one-notch uplift from ratings of Kazkommertsbank. In Moody's opinion the decline in the level of flows observed in the recent months do not provide sufficient comfort that the transaction features warrant a one-notch uplift from the current ratings of Kazkommertsbank. Moody's ratings address only the credit risks associated with the transaction. Other non-credit risks have not been addressed, but may have a significant effect on yield to investors. Date of last rating action: December 12, 2008 when notes were put on review for possible downgrade. KOKSHE RELIZ: Creditors Must File Claims by April 10 ---------------------------------------------------- The Specialized Inter-Regional Economic Court of Akmola has declared LLP Kokshe Reliz insolvent. Creditors have until April 10, 2009, to submit written proofs of claim to: Kenesary Str. 46-38 Astana Kazakhstan The Court is located at: The Specialized Inter-Regional Economic Court of Akmola Gorky Str. 37 Kokshetau Akmola Kazakhstan KOKSHE SHINA: Creditors Must File Claims by April 10 ---------------------------------------------------- The Specialized Inter-Regional Economic Court of Akmola has declared LLP Kokshe Shina insolvent. Creditors have until April 10, 2009, to submit written proofs of claim to: Kenesary Str. 46-38 Astana Kazakhstan The Court is located at: The Specialized Inter-Regional Economic Court of Akmola Gorky Str. 37 Kokshetau Akmola Kazakhstan KSM SERVICE XXI LLP: Creditors Must File Claims by April 10 ----------------------------------------------------------- The Specialized Inter-Regional Economic Court of Aktube has declared LLP Ksm Service XXI insolvent. Creditors have until April 10, 2009, to submit written proofs of claim to: Altynsarin Str. 31 Aktobe Aktube Kazakhstan The Court is located at: The Specialized Inter-Regional Economic Court of Aktube Satpayev Str. 16 Aktobe Aktube Kazakhstan RBK TECHNOLOGIES: Creditors Must File Claims by April 10 -------------------------------------------------------- LLP RBK Technologies has declared insolvency. Creditors have until April 10, 2009, to submit written proofs of claim to: Gaidar Str. 56-113 Almaty Kazakhstan RG BRANDS: Moody's Reviews 'B2' Corporate Rating for Possible Cut ----------------------------------------------------------------- Moody's Investors Service has placed the B2 corporate family rating and probability of default rating of OJSC RG Brands under review for possible downgrade. These ratings were affected: - B2 Corporate Family Rating and Probability of Default Rating "The rating action was prompted primarily by the impact that the decision by Kazakhstan's central bank to allow the devaluation of the Kazakh tenge by around 18% will have on RG Brands' 2009 financial metrics," explains Stefano del Zompo, lead analyst for RG Brands at Moody's. "Moody's is concerned given the company's relatively large debt exposure to foreign currencies and large portion of costs denominated in euros and dollars, and the effect the devaluation could have on its ability to meet a stepped-down covenant test in March 2009". Other factors continue to exert negative pressure on the ratings, including: (i) 2008 results slightly below expectations; (ii) an increasingly difficult macroeconomic environment in Kazakhstan, leading to reduced consumer spending and possibly a less favourable sales mix for the company; and (iii) a significant degree of liquidity risk given a reliance on uncommitted credit facilities in addition to the committed facilities granted by the European Bank of Restructuring and Development and the Development Bank of Kazakhstan. Moody's understands that the majority of the contracts between RG Brands and its suppliers include automatic price adjustment mechanisms which should cushion the pressure from the unfavourable foreign exchange development on the company's margins this year. "However, Moody's expects that the devaluation of the Kazakh tenge and the difficult macroeconomic environment will largely absorb RG Brands' headroom for credit metrics within the rating category in 2009, says Mr. del Zompo. "This will render a breach under the existing covenants very likely unless the EBRD continues to offer its support". Moody's review will focus on: (i) the likelihood that the company will be able to renegotiate its existing covenants with the EBRD and its other banks and to maintain sufficient headroom under the new covenant structure; (ii) the short-to-medium term prospects of the company and its capacity to withstand the current economic downturn; and iii) RG Brands' financial plan and the ability of the company to maintain credit metrics in line with the targets set by Moody's within its rating category. Moody's last rating action on RG Brands was on January 16, 2008, when Moody's affirmed the company's B2 ratings and changed the outlook to negative from stable. Headquartered in Almaty, Kazakhstan, OJSC RG Brands is a leading food and beverages producer in Central Asia. The company, which is 100% owned by the Resmi Group and RG brands management team, was established in 1994 and has grown rapidly through acquisitions. In 2007, the company reported sales and EBITDA of around KZT25 billion (ca. US$220 million) and KZT3.4 billion (ca US$28.3 million), respectively and is expected to report 2008 results that are broadly in line with the previous year. SERVICE TELECOM: Creditors Must File Claims by April 10 ------------------------------------------------------- LLP Service Telecom has declared insolvency. Creditors have until April 10, 2009, to submit written proofs of claim to: Micro District "Stepnoi-4", 19-84 Karaganda Kazakhstan SIVRES LTD: Creditors Must File Claims by April 10 -------------------------------------------------- The Specialized Inter-Regional Economic Court of East Kazakhstan has declared LLP Sivres Ltd. insolvent. Creditors have until April 10, 2009, to submit written proofs of claim to: Myzy Str. 29-77 Ust-Kamenogorsk East Kazakhstan Kazakhstan Tel: 8 (7232) 47-82-66 The Court is located at: The Specialized Inter-Regional Economic Court of East Kazakhstan Bajov Str. 2 070000 Ust-Kamenogorsk East Kazakhstan Kazakhstan * Moody's Lowers Ratings on 15 Kazakh Financial Institutions ------------------------------------------------------------ Moody's Investors Service downgraded the deposit and debt ratings of 15 financial institutions in Kazakhstan. The deposit and debt ratings of five financial institutions previously on review for downgrade were confirmed. The deposit and debt ratings of four financial institutions remain on review for possible further downgrade, while the ratings of one bank are on review with direction uncertain. The outlook on all Kazakh financial institutions' deposit and debt ratings, except for those on review, is negative. At the same time, the rating agency downgraded the bank financial strength ratings of six banks and confirmed the BFSRs of three banks. The BFSRs of the remaining six Kazakh financial institutions previously not on review were affirmed. For six banks, the BFSR outlook is stable, and for nine, it is negative. See rating list below for details of the affected institutions and the rating actions carried out. Moody's said that the rating downgrades -- which conclude its review initiated on December 12, 2008 -- reflect the increasingly negative impact of the global economic crisis on the Kazakh economy and its financial institutions. In its review, Moody's had focused on: (i) analysing the impact of the deteriorating macroeconomic conditions on Kazakh financial institutions' fundamentals; and (ii) re-examining the government support incorporated into the deposit and debt ratings of banks and government-related issuers (GRIs -- financial institutions with significant government ownership or a special charter or public policy mandate from the government). The mounting asset quality and liquidity problems in Kazakh banks continue to exert downward pressure on their financial stability. Moody's estimates that the level of non-performing loans in Kazakh banks accounts for about a quarter of all loans outstanding. Despite the recent recapitalization of the largest banks by the government, selected institutions may face a significant weakening of their capital positions from rising loan losses in the short term, the rating agency concluded. Furthermore, the inability to refinance their large foreign wholesale debt, as well as a likely decline in customer funding, creates notable liquidity problems for most banks. As of year-end 2008, the total foreign wholesale debt of Kazakh banks was about USUS$40 billion, of which USUS$12 billion is payable in 2009. "The recent devaluation of the Kazakh tenge also erodes the banks' financial standing by increasing their foreign currency debt burdens and by raising the default probability of their foreign currency loans," says Armen Dallakyan, a London-based Moody's analyst. "All of these problems expose Kazakh financial institutions to substantial risks that challenge the viability of their franchises and financial fundamentals, and therefore the banks' BFSRs, which reflect these risks, remain under pressure," Mr Dallakyan adds. The rating agency has also re-examined the systemic support probabilities incorporated into Kazakh banks' and GRIs' deposit and debt ratings. The revised assumptions, which reflect Moody's assessment of the government's willingness to actually furnish support, are based on both the individual institution's significance to the Kazakh economy and the potential cost of such support. Moody's acknowledged the Kazakh authorities' commitment to supporting the country's banking system to ensure the security of customer deposits and credit flow to the economy. At the same time, the rating agency cautioned that the uncertainty about the length and severity of the current crisis and its impact on the Kazakh economy may make the government more cautious and selective in using its resources, especially its foreign currency reserves, to support various projects and entities. Given these considerations, Moody's has lowered its assessment of the systemic support probability of the six largest Kazakh banks. On the other hand, the systemic support assumptions for the rated GRIs remains unchanged, or have been reduced only modestly, reflecting the relative importance of these entities' policy roles, as well as the likely size and expense of any support needed. The deposit and debt ratings of one bank -- BTA Bank -- remain on review, with direction uncertain. The conclusion of Moody's review will depend on the outcome of the negotiations to resell the bank to Russia's Sberbank following the nationalization of BTA Bank. The institutions affected by Moody's rating actions are as follows. BTA Bank - BFSR: downgraded to E+ (mapping to a Baseline Credit Assessment of B3) from D- (mapping to a Baseline Credit Assessment of Ba3), negative outlook; - Local and foreign currency deposit ratings: downgraded to B1 from Ba1; - Foreign currency senior unsecured debt rating: downgraded to B1 from Ba1; - Subordinated foreign currency debt rating: downgraded to B2 from Ba2; - Junior subordinated foreign currency debt rating: downgraded to Caa1 from Ba3; - The local currency deposit rating benefits from a moderate systemic support probability that results in a two-notch uplift from the Baseline Credit Assessment of B3; - The bank's deposit and debt ratings are placed on review with direction uncertain. ATF Bank - BFSR: downgraded to E+ (mapping to a Baseline Credit Assessment of B2) from D- (mapping to a Baseline Credit Assessment of Ba3); - Local currency deposit rating: downgraded to Ba1 from Baa2; - Foreign currency senior unsecured debt rating: downgraded to Ba1 from Baa2; - Junior subordinated foreign currency debt rating: downgraded to Ba3 from Ba1; - The local currency deposit rating benefits from a high probability of support from its ultimate parent, UniCredit, and a low systemic support probability that result in a four- notch uplift from the Baseline Credit Assessment of B2; - The outlook on all of the bank's ratings is negative. Temirbank - BFSR: unchanged at E (mapping to a Baseline Credit Assessment of Caa1), stable outlook; - Local and foreign currency deposit ratings: downgraded to B3 from B2; - Foreign currency senior unsecured debt rating: downgraded to B3 from B2; - Subordinated foreign currency debt rating: downgraded to Caa1 from B3; - The local currency deposit rating benefits from a high probability of support from its parent, BTA Bank, that results in a one-notch uplift from the Baseline Credit Assessment of Caa1; - The bank's deposit and debt ratings remain on review for possible further downgrade. Kazkommertsbank - BFSR: downgraded to E+ (mapping to a Baseline Credit Assessment of B2) from D- (mapping to a Baseline Credit Assessment of Ba3); - Local and foreign currency deposit ratings: downgraded to Ba3 from Ba1; - Foreign currency senior unsecured debt rating: downgraded to Ba3 from Ba1; - Subordinated debt rating: downgraded to B1 from Ba2; - Junior subordinated debt rating: downgraded to B3 from Ba3; - The local currency deposit rating benefits from a moderate systemic support probability that results in a two-notch uplift from the Baseline Credit Assessment of B2; - The outlook on all of the bank's ratings is negative. Bank CenterCredit - BFSR: downgraded to E+ (mapping to a Baseline Credit Assessment of B1) from D- (mapping to a Baseline Credit Assessment of Ba3); - Local and foreign currency deposit ratings: downgraded to Ba3 from Ba1; - Foreign currency senior unsecured debt rating: downgraded to Ba3 from Ba1; - Junior subordinated debt rating: downgraded to B2 from Ba3; - The local currency deposit rating benefits from a moderate systemic support probability that results in a one-notch uplift from the Baseline Credit Assessment of B1; - The outlook on all of the bank's ratings is negative. Halyk Savings Bank of Kazakhstan - BFSR: downgraded to D- (mapping to a Baseline Credit Assessment of Ba3) from D (mapping to a Baseline Credit Assessment of Ba2); - Local currency deposit rating: downgraded to Ba2 from Baa3; - Foreign currency deposit rating: downgraded to Ba2 from Ba1; - Foreign currency senior unsecured debt rating: downgraded to Ba2 from Baa3; - The local currency deposit rating benefits from a moderate systemic support probability that results in a one-notch uplift from the Baseline Credit Assessment of Ba3; - The outlook on all of the bank's ratings is negative. Nurbank - BFSR: unchanged at E+ (mapping to a Baseline Credit Assessment of B2), stable outlook; - Local and foreign currency deposit ratings: downgraded to B2 from B1; - The outlook on all of the bank's deposit ratings is negative. Tsesna Bank - BFSR: unchanged at E+ (mapping to a Baseline Credit Assessment of B3 from B1); - Local and foreign currency deposit ratings: downgraded to B3 from B1; - The outlook on all of the bank's ratings is negative. Kazakhstan Mortgage Company - Baseline Credit Assessment: lowered to 14 from the range of 11-13; - Local currency issuer rating: downgraded to Baa3 from Baa1; - The local currency issuer rating benefits from a very high systemic support probability that results in a four-notch uplift from the Baseline Credit Assessment of 14, two notches lower than the local currency government bond rating for Kazakhstan; - The outlook on the rating is negative. House Construction Savings Bank of Kazakhstan - BFSR: unchanged at E+ (mapping to a Baseline Credit Assessment of B2), stable outlook; - Local currency deposit rating: downgraded to Baa3 from Baa2; - Local currency issuer rating benefits from a very high systemic support probability that results in a five-notch uplift from the Baseline Credit Assessment of B2; - The outlook on the local currency deposit rating is negative. Kazagrofinance - Baseline Credit Assessment: lowered to 15 from 14; - Local and foreign currency issuer ratings: downgraded to Baa3 from Baa2; - The local currency issuer rating benefits from a very high systemic support probability that results in a five-notch uplift from the Baseline Credit Assessment of 15, two notches lower than the local currency government bond rating for Kazakhstan; - The outlook on the ratings is negative. Agrarian Credit Corporation - Baseline Credit Assessment: unchanged at 15; - Local and foreign currency issuer ratings: downgraded to Baa3 from Baa2; - The local currency issuer rating benefits from a very high systemic support probability that results in a five-notch uplift from the Baseline Credit Assessment of 15, two notches lower than the local currency government bond rating for Kazakhstan; - The outlook on the ratings is negative. Astana Finance - Baseline Credit Assessment: lowered to 17 from 14; - Local and foreign currency debt ratings: downgraded to B3 from Ba1; - The local currency issuer rating benefits from a high systemic support probability that results in a one-notch uplift from the Baseline Credit Assessment of 17, eight notches lower than the local currency government bond rating for Kazakhstan; - The outlook on all of the company's ratings is negative. Delta Bank - BFSR: confirmed at E+ (mapping to a Baseline Credit Assessment of B3); - Local and foreign currency deposit ratings: confirmed at B3; - The outlook on all of the bank's ratings is negative. Eximbank - BFSR: confirmed at E+ (mapping to a Baseline Credit Assessment of B3); - Local and foreign currency deposit ratings: confirmed at B3; - The outlook on all of the bank's ratings is negative. Eurasian Bank - BFSR: unchanged at E+ (mapping to a Baseline Credit Assessment of B1), stable outlook; - Local and foreign currency deposit ratings: confirmed at B1; - The outlook on all of the bank's deposit ratings is negative. Kaspi Bank - BFSR: downgraded to E+ (mapping to a Baseline Credit Assessment of B1) from D- (mapping to a Baseline Credit Assessment of Ba3); - Local and foreign currency deposit ratings: downgraded to B1 from Ba3; - The outlook on all of the bank's ratings is negative. SB Sberbank - BFSR: unchanged at E+ (mapping to a Baseline Credit Assessment of B2), stable outlook; - Local and foreign currency deposit ratings: confirmed at Ba2; - The local currency deposit rating benefits from a high probability of support from its Russian parent, Sberbank, that results in a three-notch uplift from the Baseline Credit Assessment of B2; - The outlook on all of the bank's deposit ratings is negative. Alfa Bank Kazakhstan - BFSR: unchanged at E+ (mapping to a Baseline Credit Assessment of B1), stable outlook; - Local and foreign currency deposit ratings: confirmed at Ba3; - The local currency deposit rating benefits from a high probability of support from its Russian parent, Alfa Bank, that results in a one-notch uplift from the Baseline Credit Assessment of B1; - The outlook on all of the bank's deposit ratings is negative. Development Bank of Kazakhstan - Baseline Credit Assessment: unchanged in the range of 11-13; - Local and foreign currency issuer ratings: downgraded to Baa2 from Baa1; - The local currency issuer rating benefits from a very high systemic support probability that results in a four-notch uplift from the Baseline Credit Assessment in the range of 11- 13, one notch lower than the local currency government bond rating for Kazakhstan; - The outlook on all of the bank's ratings is negative. DBK Leasing - Baseline Credit Assessment: lowered to 16 from 15; - Local currency issuer rating is affirmed at Ba3; - The local currency issuer rating benefits from a high systemic support probability that results in a three-notch uplift from the Baseline Credit Assessment of 16, five notches lower than the local currency government bond rating for Kazakhstan; - The outlook on the rating is negative. Moody's previous rating action on BTA Bank was on December 12, 2008 when the bank's D- BFSR, local currency and foreign currency deposit ratings of Ba1, senior unsecured debt rating of Ba1 were placed on review for possible downgrade. Moody's previous rating action on ATF Bank was on December 12, 2008 when the bank's D- BFSR, local currency deposit rating of Baa2, local currency deposit rating of Baa2, senior unsecured debt rating of Baa2 were placed on review for possible downgrade. Moody's previous rating action on Temirbank was onFebruary 9, 2009 when the bank's E+ BFSR was downgraded to E, and long-term bank deposit and unsecured debt ratings were downgraded to B2 from Ba3. Moody's previous rating action on Kazkommertsbank was on December 12, 2008 when the bank's D- BFSR, local currency and foreign currency deposit ratings of Ba1, and senior unsecured debt rating of Ba1 were placed on review for possible downgrade. Moody's previous rating action on Bank CenterCredit was on December 12, 2008 when the bank's D- BFSR, local currency and foreign currency deposit ratings of Ba1, and senior unsecured debt rating of Ba1 were placed on review for possible downgrade. Moody's previous rating action on Halyk Savings Bank of Kazakhstan was on December 12, 2008 when the bank's D BFSR, local currency deposit rating of Baa3, and senior unsecured debt rating of Baa3 were placed on review for possible downgrade. Moody's previous rating action on Nurbank was implemented on December 12, 2008 when the bank's E+ BFSR was affirmed, local currency and foreign currency deposit ratings of B1 were placed on review for possible downgrade. Moody's previous rating action on Tsesna Bank was on December 12, 2008 when the E+ BFSR was affirmed, and local currency and foreign currency deposit ratings of B1, senior unsecured debt rating of B1 were placed on review for possible downgrade. Moody's previous rating action on Kazakhstan Mortgage Company was on December 12, 2008 when the Baa1 issuer rating was placed on review for possible downgrade. Moody's previous rating action on House Construction Saving Bank of Kazakhstan was on December 12, 2008 when the bank's E+ BFSR was affirmed, and the local currency deposit rating of Baa2 was placed on review for possible downgrade. Moody's previous rating action on KazAgroFinance was on December 12, 2008 when the Baa2 issuer rating was placed on review for possible downgrade. Moody's previous rating action on Agrarian Credit Corporation was on 12 December 2008 when the Baa2 issuer rating was placed on review for possible downgrade. Moody's previous rating action on Astana Finance was on December 12, 2008 when the Ba1 issuer rating was placed on review for possible downgrade. Moody's previous rating action on Delta Bank JSC was on December 12, 2008 when the bank's E+ BFSR, and local currency and foreign currency deposit ratings of B3 were placed on review for possible downgrade. Moody's previous rating action on Eximbank Kazakhstan was on December 12, 2008 when the bank's E+ BFSR, and local currency and foreign currency deposit ratings of B3 were placed on review for possible downgrade. Moody's previous rating action on Eurasian Bank was on December 12, 2008 when the bank's E+ BFSR was affirmed, and local currency and foreign currency deposit ratings of B1 were placed on review for possible downgrade. Moody's previous rating action on Kaspi Bank was on December 12, 2008 when the bank's D- BFSR, local currency and foreign currency deposit ratings of Ba3, and senior unsecured debt rating of Ba3 were placed on review for possible downgrade. Moody's previous rating action on SB Sberbank JSC was on December 12, 2008 when the bank's E+ BFSR was affirmed, and local currency and foreign currency deposit ratings of Ba2 were placed on review for possible downgrade. Moody's previous rating action on Alfa-Bank Kazakhstan was on December 12, 2008 when the bank's E+ BFSR was affirmed, and local currency and foreign currency deposit ratings of Ba3 were placed on review for possible downgrade. Moody's previous rating action on Development Bank of Kazakhstan was implemented on December 12, 2008 when the issuer rating was downgraded to Baa1 from A2, and placed on review for possible further downgrade. Moody's previous rating action on DBK Leasing was December 12, 2008 when the Ba3/Not Prime ratings were affirmed. =================== K Y R G Y Z S T A N =================== ORIENT TRANS: Creditors Must File Claims by March 20 ---------------------------------------------------- LLC Orient Trans has declared insolvency. Creditors have until March 20, 2009, to submit written proofs of claim to: LLC Orient Trans Tolstoy Str. 190a-6 Bishkek Kyrgyzstan =================== L U X E M B O U R G =================== LECTA SA: S&P Changes Outlook to Negative; Affirms 'B+' Rating -------------------------------------------------------------- Standard & Poor's Ratings Services said that it has revised its outlook on Luxembourg-based paper manufacturer Lecta S.A. to negative from stable. At the same time, the 'B+' long-term and 'B' short-term corporate credit ratings were affirmed. The outlook revision reflects challenging operating conditions in Europe's coated woodfree paper market. "This results from the deterioration in economic conditions, which has caused demand to decrease," said Standard & Poor's credit analyst Jacob Zachrison. "Consequently, S&P see increased risk that the benefits of lower pulp prices, a currently strong U.S dollar, and price increases achieved during 2008 could be offset by lower volumes and restructuring charges related to capacity closures." The ratings continue to reflect Lecta's exposure to the cyclical, competitive, and challenging European CWF paper market. They also reflect significant exposure to market pulp prices, although Lecta will benefit from this in the near term. The financial risk profile is highly leveraged. These weaknesses are offset by a good market position, with leading cost advantages derived from the company's location close to key end markets; access to a modern, flexible asset base; and a focused business and financial strategy. In addition, Lecta's liquidity position, which S&P considers adequate for the time being, is a key supportive factor for the ratings. Owing to current market conditions, S&P expects Lecta's financial performance to remain weak for the ratings in the short term. S&P base its view primarily on lower demand, higher capital expenditures related to new cogeneration plants, and restructuring charges associated with capacity closures. For the 12 months ended Sept. 30, 2008, Lecta's fully adjusted debt to EBITDA was 5.5x and funds from operations to debt was 6.4%. These credit metrics are low for the rating level and there is little room for further deterioration without a rating impact. Although free operating cash flow is likely to turn negative, in S&P's view, during 2009, S&P believes that Lecta will be able to maintain an adequate liquidity position for the ratings. "The negative outlook reflects the possibility of a downgrade if Lecta's operating and financial performance fail to recover in the near term," said Mr. Zachrison. "This could happen, for example, as a result of lower demand." Standard & Poor's could also lower the ratings if Lecta's liquidity position materially weakens owing to lower-than-expected free operating cash flow generation. S&P consider credit metrics of FFO to debt of 10%-15% and debt to EBITDA of about 5x or lower to be consistent with the current ratings. S&P could revise the outlook back to stable if Lecta improves its financial performance to levels commensurate with the current rating level. S&P believes this would be possible if Lecta could raise its CWF prices during 2009, combined with still low pulp costs and a strong U.S. dollar. ===================== N E T H E R L A N D S ===================== CARLSON WAGONLIT: Moody's Cuts Corporate Family Rating to 'B2' -------------------------------------------------------------- Moody's Investors Service has downgraded to B2 from B1 the corporate family rating of Carlson Wagonlit BV. At the same time, Moody's has downgraded CWT's EUR285 million notes to Caa1 from B3 and US$850 million senior facilities to B1 from Ba3. The ratings remain under review for further downgrade. "The rating action reflects a more severe anticipated downturn in global travel demand than was anticipated by Moody's at the end of last year," explains Marika Makela, an Assistant Vice President- Analyst in Moody's Corporate Finance Group. "Indeed, Moody's believes there is a strong likelihood that CWT's credit metrics will not be in line with the B1 rating category." Moody's has previously stated that negative pressure could evolve if CWT's gross debt to EBITDA exceeded 5.5x. Moody's now expects that the anticipated weaker activity levels could put the company's EBITDA generation under pressure in the current financial year. Furthermore, while Moody's expects the company to have been compliant with its financial covenants at December 2008, there is a significant step-up in the covenant levels each quarter under the senior facilities. "Therefore, if the economic conditions worsen, CWT's operating conditions could be negatively affected at a time when the company still needs solid EBITDA generation to meet its tightening covenants," comments Ms. Makela. Moody's recognizes the more resilient nature of CWT's US Government & Military business. Furthermore, CWT's management is committed to delivering cost savings and productivity improvements, and is continuously improving its market position through new sales. Moody's notes that with over two-thirds of costs relating to personnel salaries, CWT benefits from staffing flexibility and an ability to adjust its costs in the event of a downturn. Nevertheless, Moody's cautions that, given the current challenges from the global economic environment to international travel demand, these measures may not be sufficient to compensate for the decline in revenues. Moody's rating review will focus on (i) assessing the measures that could be implemented across the group in order to support margins, and (ii) to what extent such measures could offset deteriorating market conditions to sustain operating performance and mitigate risks of a potential breach of the financial covenants included in the senior facility agreements. The last rating action was implemented on November 26, 2008, when Moody's downgraded CWT's CFR to B1 with a negative outlook. Headquartered in the Netherlands, CWT is a global leader in travel management, serving corporations of all sizes and government institutions. It reported revenues of approximately US$1.8 billion in 2007. NXP BV: S&P Affirms Issue Rating on Senior Secured Notes at 'CCC' ----------------------------------------------------------------- Standard & Poor's Ratings Services said that it had revised its recovery ratings on the senior secured notes co-issued by NXP B.V. (CCC/Negative/--) and NXP Funding LLC to '4' from '3'. A '4' recovery rating indicates Standard & Poor's expectation of average (30%-50%) recovery in the event of a payment default. The issue rating on these notes remains unchanged at 'CCC', in line with the corporate credit rating on NXP B.V. The issue ratings and recovery ratings on all other debt, including the secured revolver and unsecured notes, remain unchanged. The revised recovery rating for the senior secured notes primarily reflects S&P's expectation of a higher level of debt outstanding assumed at S&P's hypothetical default. The cash proceeds of US$92 million that S&P understand the company has received from the sale of the remaining 20% wireless division are materially below S&P's initial assumptions of US$300 million-US$450 million. This results in higher senior secured debt outstanding at default -- due to much lower bond prepayments from the disposals -- and lower expected recovery expectations at default for secured and unsecured notes. Furthermore, S&P consider that recovery prospects for senior secured noteholders are highly dependent on the value realized from the group's intellectual property assets pledged as collateral, which, in S&P's view, creates greater uncertainty of recovery for secured creditors. Overall, recovery expectations, which were previously at the low end of the 50%-70% range, now fall within the 30%-50% range using S&P's revised assumptions. Under S&P's hypothetical default scenario, S&P assume that the company is reorganized and valued in bankruptcy at a distressed EBITDA multiple of about 6.7x, although this reflects substantial differences between the valuations of the core NXP business and the stake in Systems on Silicon Manufacturing Co. Pte. Ltd. Numerical coverage for the senior secured and unsecured debt issues reflects S&P's view of the low share of group EBITDA generated by the guarantor group, which reduces the potential value of the collateral available for secured lenders in favor of unsecured bondholders. As part of S&P's analysis S&P has assumed that secured noteholders do not benefit from prior-ranking access to assets or shares of 61.2%-owned SSMC, a key cash generator of the group. S&P will publish a full recovery report on NXP B.V. on RatingsDirect in the next few days. =========== R U S S I A =========== EKO-STROY LLC: Creditors Must File Claims by April 22 ----------------------------------------------------- Creditors of LLC Eko-Stroy (TIN 7805402675) have until April 22, 2009, to submit proofs of claims to: A. Borunov Insolvency Manager Office 606 Prospect Mira 68 129110 Moscow Russia The Arbitration Court of Saint-Petersburg commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. A56�57705/2008. The Debtor can be reached at: LLC Eko-Stroy Office 6H Marshala Govorova St. 47A 198095 Saint-Petersburg Russia INDO-RUS-MANUFAKTURA LLC: Creditors Must File Claims by March 22 ---------------------------------------------------------------- Creditors of LLC Indo-Rus-Manufaktura (TIN 3703013640) (Jewelry Industry) have until March 22, 2009, to submit proofs of claims to: M. Khasanova Temporary Insolvency Manager Post User Box 345 115230 Moscow-230 Russia The Arbitration Court of Ivanovskaya will convene at on April 22, 2009, to hear bankruptcy supervision procedure. The case is docketed under Case No. A 17�6476/2008�10-B . The Debtor can be reached at: LLC Indo-Rus-Manufaktura Komsomolskaya St.11 Kineshma Ivanovskaya Russia MIRAX GROUP: Recent Exchange Offer Cues Moody's Junk Rating ----------------------------------------------------------- Moody's Investors Service has downgraded the Caa1 corporate family rating and Ba3.ru national scale rating of Mirax Group Holding B.V. to Ca and Ca.ru respectively. The rating outlook was changed to negative to reflect the risk that the refinancing may fail contrary to current expectations. The actions conclude the rating review initiated on February 5, 2009. The downgrade of the ratings to Ca reflects Moody's view that Mirax's recent offer to exchange credit linked notes and a loan for longer dated and higher yielding instruments will constitute a distressed exchange. It also reflects the very high likelihood of the transaction closing. While no payment default may have occurred in Moody's opinion the successful closing of the transaction, which is designed to extend debt maturities, would represent the occurrence of a deemed default. During the exchange offer process, the Ca CFR will prevail. Upon closing of the exchange, the suffix "/LD" (limited default) will be attached to the corporate rating to reflect the limited default that will have occurred. The "/LD" suffix will be removed three business days after the exchange and the CFR repositioned. Moody's last rating action was taken on February, 5 2008 when Moody's Investors Service downgraded the B3 corporate family rating and Baa3.ru national scale rating of Mirax Group Holding B.V. to Caa1 and Ba3.ru respectively. At the same time, Moody's had placed all rating under review for possible downgrade. The rating action was then prompted by the fact that Mirax has a very short maturity profile of its debt with a total US$380 million due within the next few weeks, including the refinancing of maturing bank debt totaling of US$ 200 million, and the potential CLN put option of US$180 million expected in March 2009, which makes the company dependent on its ability to continue to generate projected cash flow or arrange alternative refinancing facilities. Mirax Group B.V. was incorporated in 2008 in the Netherlands as a result of corporate restructuring of Mirax Group. It is now one of the five largest real estate development companies in Moscow, with a strong market position in the development of business class offices and premium housing. Apart from developing several residential and commercial real estate complexes, Mirax is currently constructing the Federation Tower which, when finished, will be the tallest building in Europe. In 2007, the company reported revenue of approximately US$1.28 billion and EBITDA of US$608 million. The company is majority owned by Mr. Sergey Polonsky, chairman of the board of directors. PLAST-FORM PLANT LLC: Creditors Must File Claims by April 22 ------------------------------------------------------------ Creditors of LLC Plast-Form Plant (TIN 3905068427, PSRN 1053900160412) (Plastic Materials) have until April 22, 2009, to submit proofs of claims to: I. Melnikov Insolvency Manager Poltavskaya St. 5 236004 Kaliningrad Russia Tel/Fax: 8(4012)685502 The Arbitration Court of Kaliningradskaya commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. A21�2951/2008. The Debtor can be reached at: LLC Plast-Form Plant Dobro Ubova St.25 236010 Kaliningrad Russia RAPSOD TRADE: S&P Junks Corporate Credit Rating From 'B-' --------------------------------------------------------- Standard & Poor's Ratings Services said that it lowered its long- term corporate credit and debt ratings on Russian outdoor advertising group Rapsod Trade Ltd. (Gallery Media) to 'CCC+' from 'B-'. The outlook is negative. At the same time, S&P revised its recovery rating on Gallery Capital's US$175 million senior secured notes, guaranteed by Rapsod Trade Ltd., to '4' from '3'. A '4' recovery rating indicates S&P's expectation of average (30%-50%) recovery for secured creditors in the event of a payment default. At Sept. 30, 2008, Gallery Media had gross on-balance-sheet debt of US$288 million. "The downgrade mainly reflects our belief that Gallery Media may struggle to honor its financial interest payment obligations over the next 18 months, following industry reports that, since the start of 2009, the Russian advertising market has been experiencing a material reversal from last year's double-digit growth," said Standard & Poor's credit analyst Melvyn Cooke. There is, in S&P's view and given current macroeconomic conditions, little prospect for a significant improvement in the advertising market in Russia in the short term. In addition, the Russian ruble, which is the group's main operating currency, has reportedly already lost about 20% of its value since Jan. 1, 2009 versus the dollar, which is the group's reporting currency. The ruble's weakness will, in S&P's view, likely contribute to a marked deterioration of Gallery Media's liquidity over the coming months, since the group does not hedge interest payments on its dollar-denominated debt. Furthermore, S&P believes that the group's Ukrainian business, which accounted for about 13% of sales in the first nine months of 2008, is also suffering from the steep advertising market downturn there. If the current rate of decline in the Russian advertising market persists throughout 2009, Standard & Poor's believes that the group's cash balances may not be sufficient to cover Gallery Media's anticipated negative free cash flow over the next 12-18 months. The group has a relatively high fixed cost base and a strong decline in revenues may result in a disproportionate decrease in operating profit. While S&P anticipate that the group should be able to meet its semi-annual interest payment in May 2009, S&P believes there may be greater uncertainty attached to the November 2009 interest payment and thereafter. S&P would view any discounted exchange offer for part or all of the group's notes as distressed given the company's tight liquidity and deteriorating trading environment. The execution of distressed exchange offers are tantamount to default under S&P's criteria. S&P notes that S&P has no indication that Gallery Media's management intends to explore such a route, but many low- rated companies have recently executed or considered discounted exchange offers. A positive rating action would likely require a material improvement in the group's liquidity position and trading conditions. SEVERO-ZAPAD OJSC: Creditors Must File Claims by April 22 --------------------------------------------------------- Creditors of OJSC Severo-Zapad (Ferro-Concrete Constructions Production) (TIN 2901101424, PSRN 1032900001100) have until April 22, 2009, to submit proofs of claims to: V. Kil�chikov Insolvency Manager Office 317 Uritskogo St. 47 163000 Arkhangelsk Russia The Arbitration Court of Arkhangelskaya commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. A05�1110/2008. The Debtor can be reached at: OJSC Severo-Zapad Prospect Leningradskiy 38 163009 Arkhangelsk Russia SOKOLNIKI OJSC: Creditors Must File Claims by April 22 ------------------------------------------------------ Creditors of OJSC Sokolniki (TIN 7704178963; PSRN 1027700135100) (Package Production) have until April 22, 2009, to submit proofs of claims to: B. Mazenko Insolvency Manager Post User Box 24 117042 Moscow Russia The Arbitration Court of Moscow commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. A40�55550/08�36�171B. The Debtor can be reached at: OJSC Sokolniki Building 1, 2 Arbat St. 6/2 119019 Moscow Russia STROY-MASH PLANT LLC: Creditors Must File Claims by April 22 ------------------------------------------------------------ Creditors of LLC Stroy-Mash Plant (TIN 5615019870, RVC 561501001) (Equipment) have until April 22, 2009, to submit proofs of claims to: S. Chernysh Insolvency Manager Gaya St. 23A 460000 Orenburg Russia Tel/Fax: 78�40-26 The Arbitration Court of Orenburgskaya commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. A47�3391/2008�14GK. The Debtor can be reached at: LLC Stroy-Mash Plant Orskoe Shosse 1 Orsk 462403 Orenburgskaya Russia STROITELNOE UPRAVLENIE: Creditors Must File Claims by April 22 -------------------------------------------------------------- Creditors of LLC Stroitelnoe Upravlenie A 15 (TIN 0721055197, PSRN 1070721007279) (Construction) have until April 22, 2009, to submit proofs of claims to: Yu. Shapavalov Insolvency Manager Ermolova St. 38 Pyatigorsk Russia The Arbitration Court of Kabardino-Balkaria commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. A20�1858/2008. The Debtor can be reached at: LLC Stroitelnoe Upravlenie A 15 Chechenskaya St. 4 Nalchik Kabardino-Balkaria Russia TEKH-STROY LLC: Creditors Must File Claims by April 22 ------------------------------------------------------ Creditors of LLC Tech-Stroy (TIN 1701038660, PSRN 1051700528890) have until April 22, 2009, to submit proofs of claims to: A. Sundui Insolvency Manager Apt. 85 Bai-Khaakskay aSt.8 Kyzyl 667011 Tyva Russia The Arbitration Court of Tyva commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. A69�2081/08�8. The Debtor can be reached at: LLC Tech-Story Shetinkina-Kravchenko St. 31/105 Kyzyl 667000 Tyva Russia TEKHNO-POLIMER LLC: Creditors Must File Claims by March 22 ---------------------------------------------------------- Creditors of LLC Tehno-Polimer (TIN 4007007997) (Plastic, Resin Production) have until March 22, 2009, to submit proofs of claims to: Z. Ganiyev Insolvency Manager Apt. 61 Potapovskiy pereulok 9/11 101000 Moscow Russia The Arbitration Court of Kaluzhskaya commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. A23�4306/08B-17�141. The Debtor can be reached at: LLC Tehno-Polimer Lesnaya St. 2a Zhukov 249190 Kaluzhskaya Russia VELES LLC: Creditors Must File Claims by April 22 ------------------------------------------------- Creditors of LLC Veles (TIN 3811097895, PSRN 1063811019018) (Construction) have until April 22, 2009, to submit proofs of claims to: V. Kadach Insolvency Manager Post User Box 113 664019 Irkutsk Russia The Arbitration Court of Irkutskaya commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. A19�9753/08�49. The Debtor can be reached at: LLC Veles Trilissera St. 57a/16 Irkutsk Russia * Moody's Cuts Local Currency Deposit Ratings on 8 Russian Banks ---------------------------------------------------------------- Moody's Investors Service downgraded the local currency deposit ratings of eight Russian banks and the issuer rating of one government-owned mortgage lender, the Agency for Housing Mortgage Lending. All ratings remain investment grade. The foreign currency deposit ratings of seven banks were affirmed while the foreign currency deposit rating of Gazprombank and issuer ratings of AHML were downgraded. According to the rating agency, with the exception of the Bank of Moscow, the outlooks on the other banks' local and foreign currency debt and deposit ratings are stable; for the Bank of Moscow's ratings, the outlook was changed to negative from stable. Moody's affirmed the bank financial strength ratings of all 8 banks but changed the outlooks on the BFSRs to negative from stable for all the banks except for Russian Agricultural Bank, where it was changed to stable from positive, and for Vnesheconombank, where the outlook remained unchanged at stable. The ratings of five foreign subsidiaries of these Russian banks were also affected by Moody's rating actions. All rating actions are detailed below. Moody's notes that the rating actions reflect the increasingly negative impact of the global economic crisis on the Russian economy and on the intrinsic strength of its financial institutions. In recent months, most of the banks included in the rating action have come to rely on capital and liquidity support provided directly or indirectly by the Russian government, as alternative sources of funding or capital have become more difficult to access. Given the systemic nature of the crisis and the large, but not unlimited, resources of the Russian government, Moody's has taken the view that the banks' local currency ratings need to be more closely aligned with the government's local currency debt rating, since it now represents the primary driver of their credit strength. All of these institutions continue to be rated substantially higher than what would be implied by their intrinsic financial strength or BFSR, ranging from an E+ (mapping to a Baseline Credit Assessment of B1) to a D+ (mapping to a Baseline Credit Assessment of Ba1). Moody's believes that this approach continues to be justified by the support that the government would likely supply, and has already supplied, to these banks during the current crisis. The banks are considered of systemic importance to Russia given, for instance, their large depositor base (Sberbank), their function as a vehicle for channelling financial support and other public policy initiatives or sector support (RAB). Despite the large number of local currency rating downgrades, Moody's affirmed the majority of these financial institutions' foreign currency deposit ratings given that the latter were already constrained by Russia's foreign currency deposit ceiling, The change in outlook on most of the banks' BFSRs to negative from stable -- and to stable from positive for RAB -- is driven by the rapidly deteriorating operating environment in Russia, which directly impacts the core financial strength of most banks. The resulting decline in asset quality is further aggravated by the depreciation of the Russian rouble, which is also reducing borrowers' ability to meet their debt service obligations and raises the cost of foreign currency lending by the banks. In addition, Moody's notes that the relatively low capital and provisioning levels among the banks limit their ability to absorb future losses from the anticipated poor asset performance. Furthermore, refinancing risk has increased, especially for foreign currency debt, as international markets continue to provide limited opportunities for raising debt. The rating actions taken by Moody's are: Sberbank - BFSR: Affirmed at D+ (mapping to Baseline Credit Assessment of Ba1), outlook change to negative from stable; - Local currency deposit ratings: downgraded to A3/P-2 from A1/P-1; - Foreign currency deposit ratings: Affirmed at Baa1/P-2; - Senior unsecured foreign currency debt rating: downgraded to A3 from A2; - Subordinated foreign currency debt ratings: downgraded to Baa1 from A2; - The local currency deposit rating benefits from a very high systemic support probability that results in a four-notch uplift from the Baseline Credit Assessment of Ba1; - The outlook on all of the bank's deposit and debt ratings is stable. Bank VTB JSC - BFSR: Affirmed at D- (mapping to Baseline Credit Assessment of Ba3), outlook changed to negative from stable; - Local currency deposit ratings: downgraded to Baa1/P-2 from A1/P-1; - Foreign currency deposit ratings: Affirmed at Baa1/P-2; - Senior unsecured local currency debt rating: downgraded to Baa1 from A1; - Senior unsecured foreign currency debt rating: downgraded to Baa1 from A2; - Subordinated foreign currency debt ratings: downgraded to Baa2 from A2; - The local currency deposit rating benefits from a very high systemic support probability that results in a five-notch uplift from the Baseline Credit Assessment of Ba3; - The outlook on all of the bank's deposit and debt ratings is stable. Bank VTB24 - BFSR: Affirmed at D- (mapping to Baseline Credit Assessment of Ba3), outlook changed to negative from stable; - Local currency deposit ratings: downgraded to Baa1/P-2 from A1/P-1; - Foreign currency deposit ratings: Affirmed at Baa1/P-2; - Senior unsecured foreign currency debt rating: downgraded to Baa1 from A2; - Subordinated foreign currency debt ratings: downgraded to Baa2 from A2; - The local currency deposit rating benefits from a very high systemic support probability that results in a five-notch uplift from the Baseline Credit Assessment of Ba3; - The outlook on all of the bank's deposit and debt ratings is stable. Bank VTB North-West - BFSR: Affirmed at D- (mapping to Baseline Credit Assessment of Ba3), outlook changed to negative from stable; - Local currency deposit ratings: downgraded to Baa1/P-2 from A2/P-1; - Foreign currency deposit ratings: Affirmed at Baa1/P-2; - Subordinated foreign and local debt ratings: downgraded to Baa2 from A3; - The local currency deposit rating benefits from a very high systemic support probability that results in a five-notch uplift from the Baseline Credit Assessment of Ba3; - The outlook on all of the bank's deposit and debt ratings is stable. Vnesheconombank (VEB) - BFSR: Affirmed at E+ (mapping to Baseline Credit Assessment of B1) with stable outlook; - Long-term local currency deposit ratings: downgraded to Baa1 from A3; - Foreign currency deposit ratings: Affirmed at Baa1/P-2; - The local currency deposit rating benefits from a very high systemic support probability that results in a six-notch uplift from the Baseline Credit Assessment of B1; - The outlook on all of the bank's deposit ratings is stable. Russian Agricultural Bank (RAB) - BFSR: Affirmed at E+ (mapping to Baseline Credit Assessment of B1), outlook changed to stable from positive; - Local currency deposit ratings: downgraded to Baa1/P-2 from A3/P-1; - Foreign currency deposit ratings: Affirmed at Baa1/P-2; - Senior unsecured local and foreign currency debt rating: downgraded to Baa1 from A3; - Subordinated foreign and local debt ratings: downgraded to Baa2 from Baa1; - The local currency deposit rating benefits from a very high systemic support probability that results in a six-notch uplift from the Baseline Credit Assessment of B1; - The outlook on all of the bank's deposit and debt ratings is stable. Bank of Moscow - BFSR: Affirmed at D (mapping to Baseline Credit Assessment of Ba2); - Long-term local currency deposit ratings: downgraded to Baa1 from A3; - Foreign currency deposit ratings: Affirmed at Baa1/P-2, - Senior unsecured local and foreign currency debt rating: downgraded to Baa1 from A3; - Subordinated foreign and local debt ratings: downgraded to Baa2 from Baa1; - The local currency deposit rating benefits from a very high probability of support from the City of Moscow and a very high systemic support probability that results in a four-notch uplift from the Baseline Credit Assessment of Ba2; - The outlook on all of the bank's BFSR and deposit and debt ratings changed to negative from stable. Gazprombank - BFSR: Affirmed at D- (mapping to Baseline Credit Assessment of Ba3); outlook changed to negative from stable; - Long-term local currency deposit ratings: downgraded to Baa2 from A3; - Foreign currency deposit ratings: downgraded to Baa2/P-2 from Baa1/P-2; - Senior unsecured local and foreign currency debt rating: downgraded to Baa2 from A3; - The local currency deposit rating benefits from a very high probability of support from Gazprom and a very high systemic support probability that result in a four-notch uplift from the Baseline Credit Assessment of Ba3; - The outlook on all of the bank's deposit and debt ratings is stable. Agency for Housing Mortgage Lending (AHML) - Foreign and local currency issuer rating: downgraded to Baa1/P-2 from A3/P-1, outlook is stable; - The local currency issuer rating benefits from a very high systemic support probability that results in a multi-notch uplift from the Baseline Credit Assessment of 11-13. This rating is placed at the same level as the local currency government bond rating for Russia. Subsidiaries of the above institutions affected by Moody's rating action . VTB Bank (Austria) AG - BFSR: D (mapping to Baseline Credit Assessment of Ba2), placed on review for downgrade; - Deposit ratings: downgraded to Baa3/P-3 from Baa2/P-2, placed on review for downgrade. VTB Bank (France) SA - BFSR: D (mapping to Baseline Credit Assessment of Ba2), placed on review for downgrade; - Deposit ratings: downgraded to Baa3/P-3 from Baa2/P-2, placed on review for downgrade. VTB Capital plc - BFSR: D (mapping to Baseline Credit Assessment of Ba2), placed on review for downgrade; - Deposit ratings: downgraded to Baa3/P-3 from Baa2/P-2, placed on review for downgrade. Russian Bank for Development -- Subsidiary of Vnesheconombank (VEB) - All ratings confirmed with stable outlook. Bank of Moscow Minsk -- Subsidiary of Bank of Moscow (BOM) - The local currency deposit ratings: Affirmed at Ba2/NP, outlook changed to negative from stable - Foreign currency deposit ratings: Affirmed at B2/NP with stable outlook. Moody's previous rating action on Sberbank was implemented on December 12, 2008, when the outlook on Baa1 foreign currency deposit rating and the A2 long-term senior unsecured foreign currency debt rating was changed to stable from positive. Moody's previous rating action on Bank VTB, JSC was implemented on December 12, 2008, when the outlook on Baa1 foreign currency deposit rating and the A2 long-term senior unsecured foreign currency debt rating was changed to stable from positive. Moody's previous rating action on VTB24 was implemented on December 12, 2008, when the outlook on Baa1 foreign currency deposit rating and the A2 long-term senior unsecured foreign currency debt rating was changed to stable from positive. Moody's previous rating action on Bank VTB North-West was implemented on December 12, 2008, when the outlook on Baa1 foreign currency deposit rating was changed to stable from positive. Moody's previous rating action on VTB Bank (Austria) AG was implemented on May 4, 2007, when the BFSR was upgraded to D from D-. Moody's previous rating action on VTB Capital plc was implemented on May 4, 2007, when the BFSR was downgraded to D from D+. Moody's previous rating action on VTB Bank (France) SA was implemented on May 11, 2007, when the bank's D/Baa2 ratings were affirmed. Moody's previous rating action on Vnesheconombank was implemented on December 12, 2008, when the outlook on Baa1 foreign currency deposit rating was changed to stable from positive. Moody's previous rating action on Russian Agricultural Bank was implemented on December 12, 2008, when the outlook on the Baa1 foreign currency deposit rating was changed to stable from positive. Moody's previous rating action on JSCB Bank of Moscow was implemented on December 12, 2008 , when the outlook on Baa1 foreign currency deposit rating was changed to stable from positive. Moody's previous rating action on Gazprombank was implemented on December 12, 2008, when the outlook on Baa1 foreign currency deposit rating was changed to stable from positive. Moody's previous rating action on Agency for Housing Mortgage Lending OJSC was implemented on March 27, 2008 when Moody's raised AHML's long-term and short-term foreign currency issuer ratings to A3/Prime-1 from Baa2/Prime-2 aligning them with the issuer's A3/Prime-1 long-term and short-term local currency ratings. * TOMSK OBLAST: S&P Downgrades Long-Term Issuer Rating to 'B-' -------------------------------------------------------------- Standard & Poor's Ratings Services said it lowered its long-term issuer rating on the Tomsk Oblast, located in western Siberia in the Russian Federation (foreign currency BBB/Negative/A-3; local currency BBB+/Negative/A-2; Russia national scale 'ruAAA'), to 'B-' from 'B+' and lowered its national scale rating to 'ruBBB' from 'ruA+'. The ratings remain on CreditWatch with negative implications. "The rating actions reflect the fact that, despite the Oblast's continued efforts to come up with a reliable refinancing plan and in contradiction to S&P's earlier expectations, it still has not been able to secure the refinancing of its upcoming debt service payments in March-May 2009, including the bank loan payment on March 2," said Standard & Poor's credit analyst Boris Kopeykin. The Oblast's liquidity position is very weak. As of Feb. 25, 2009, the Oblast had just Russian ruble 281 million in free cash, whereas it has to repay a RUR1 billion loan on March 2, 2009. Initial plans were to refinance this loan, but despite some indications from the Oblast's banking partner that refinancing would be provided, a timely receipt of the funds has still not been secured. However, the Oblast has an additional committed bank line for RUR450 million and expects to receive more than RUR500 million in revenues before the due date, making the repayment without refinancing tight but possible. In addition, the Oblast has yet to clarify its refinancing schemes for the remaining RUR1.5 billion of bank loans due in March-May 2009, as well as for the second debt repayment peak estimated at more than RUR2 billion in November-December 2009, against a backdrop of contracting revenue streams. ============================= S L O V A K R E P U B L I C ============================= TERMMING AS: Moody's Withdraws 'Ba1' Long-Term National Rating -------------------------------------------------------------- Moody's Investors Service has withdrawn the Ba1.sk long-term national scale rating of Termming, A.S. at the request of the issuer. Moody's has withdrawn this rating for business reasons. Please refer to Moody's Withdrawal Policy on moodys.com. Moody's previous rating action on Termming was on July 17, 2008, when the outlook on the rating was changed to stable from negative. Termming's rating was assigned by evaluating factors that Moody's believes are relevant to the credit profile of the issuer, such as (i) the business risk and competitive position of the company versus others within its industry, (ii) the capital structure and financial risk of the company, (iii) the projected performance of the company over the near to intermediate term, and (iv) management's track record and tolerance for risk. These attributes were compared against other issuers both within and outside of Termming's core industry and Termming's ratings are believed to be comparable to those of other issuers of similar credit risk. Termming a.s. is a local producer and distributor of steam heating for the majority of the City of Bratislava, the capital of the Slovak Republic, and surrounding areas. Of its total 2007 sales of SKK431 million (EUR 12.8 million), 99% is derived from regulated heating deliveries and 1% from unregulated residential facilities management services. COMERON SPS currently holds 70.25% of the company, with the remainder owned by private entities. =============== S L O V E N I A =============== STS: Siemens Launches Liquidation Proceedings; 320 Jobs at Risk --------------------------------------------------------------- Siemens has launched liquidation proceedings for its Maribor-based rail vehicle assembly plant STS, putting around 320 jobs at risk, STA reports citing the Maribor District Court. According to the report, the workers are expected to be out of work by the end of March. In a Feb. 3 report Steel Guru disclosed talks on the sale of STS to Slovenian rail operator Slovenske zeleznice collapsed. Korea-based company Heung also backed out of talks due to the global financial crisis, Steel Guru noted. Steel Guru stated worker representatives believe the liquidation of STS would be detrimental to the state, in particular given the major investments planned in Slovenian rail infrastructure. On Jan. 29, 2009, around 250 workers carried out an industrial action in Ljubljana to protest against the possible shut down of the factory, Steel Guru added. ========= S P A I N ========= CEMEX SAB: Fitch Assigns 'BB' Rating on Dollar-Denominated Bond --------------------------------------------------------------- Fitch Ratings expects to assign a rating of 'BB' to Cemex, S.A.B. de C.V.'s proposed dollar-denominated bond. Proceeds from this bond, which is expected to be approximately US$500 million, will be used to repay existing bank debt. The bond will be issued by Cemex and guaranteed by New Sunward and Cemex Mexico, S.A. de C.V. The 'BB' rating of these proposed notes takes into consideration Cemex's strong global business position as an integrated cement player and its ability to continue to generate free cash flow during the worst economic downturn in recent history. The ratings factor in as positive the Mexican government's support of Cemex due to the size of the company and its importance to the country's economy, as well as the banks continued support of the company. Balanced against these credit strengths are the high level of leverage at Cemex, as well as the debt maturities of approximately US$4.1 billion, USUS$3.8 billion and US$7.8 billion during 2009, 2010 and 2011, respectively. Fitch expects Cemex's total adjusted net debt to EBITDAR ratio to remain above 5.0 times (x) during 2009 and to remain above 4.0x during 2010. This level of leverage is due to unprecedented downturns in three of the company's key markets - the United States, Spain and the U.K. - as well as a weakening of some of the company's markets that performed well in 2008. Cemex's foreign currency Issuer Default Rating was downgraded to 'BB' from 'BB+' by Fitch on Feb. 23, 2009. Fitch's Rating Outlook for Cemex is Negative. This Rating Outlook reflects the challenges that all companies in the cement, ready-mix and aggregate industries will face during 2009 and 2010, particularly those that are reliant upon the U.S. and European markets. As of Dec. 31, 2008, Cemex had total adjusted debt of US$23 billion and cash and marketable securities of US$993 million; adjusted debt includes total debt plus perpetual debt and operating leases. During 2008, Cemex generated US$4.6 billion of EBITDAR, resulting in a total adjusted debt to EBITDAR ratio of about 5.0x. During the fourth quarter of 2008 the company's EBITDAR declined to about US$860 million from about US$1.350 billion during the prior quarter. Factoring in seasonality, the numbers were still substantially lower than during the last quarter of 2007, when Cemex's EBITDAR was US$1.150 billion. The drop-off in EBITDAR was driven by steep declines in sales volumes and the devaluation of the Mexican peso, British pound and Euro versus the U.S. dollar. For 2009, Cemex projects an EBITDAR range of about US$3.7 billion to US$3.9 billion. Through free cash flow and asset sales, the company intends to reduce debt by US$3.6 billion. To achieve these goals the company has scaled back its 2009 capital expenses to US$650 million from around US$2 billion during both 2007 and 2008. The company has also implemented a restructuring program aimed at achieving US$700 million of recurring synergies. In addition to the aforementioned, Cemex is attempting to divest about US$2 billion of assets in 2008. Obstacles the company will have to overcome as it seeks to sell assets include: the high debt burden of several leading producers of cement and ready mix; tight credit conditions and high cost of capital; and the ability of the company to obtain attractive bids given the current economic uncertainty. Cemex is the third-largest cement producer in the world based on production capacity of approximately 97 million metric tons and operates in more than 50 countries. The company is also the global leader in the ready mix concrete market with sales of over 80.5 million cubic meters, and an important global player in the aggregates business with sales of 222.7 million tons. In 2008, Cemex generated US$4.370 billion of EBITDA on US$21.8 billion of sales revenues. CEMEX SAB: S&P Retains Negative Watch on 'BB+' Corporate Rating --------------------------------------------------------------- Standard & Poor's Ratings Services said that its 'BB+' long-term corporate credit ratings on Cemex S.A.B de C.V. and its key operating subsidiaries (Cemex Espana S.A., Cemex Mexico S.A. de C.V., and Cemex Inc.) remain on CreditWatch, where they were placed with negative implications on Jan. 21, 2009. At the same time, S&P assigned a 'BB+' rating to Cemex's intermediate-maturity notes in the amount of about US$500 million. The recovery rating is '3', indicating that lenders can expect substantial (70% to 90%) recovery in the event of a payment default. "The CreditWatch placement reflects our concerns that Cemex will experience further deterioration in its key financial ratios and that the company will continue to rely on asset disposals to cover part of its debt maturities in 2009," said Standard & Poor's credit analyst Juan Pablo Becerra. "Additionally, S&P is concerned that Cemex's asset sales may be hampered by depressed asset prices and the near-freeze in global credit markets." The company has continued its effort to cover its 2009 maturities' shortfall, as evidenced by its planned debt issuance. S&P expects to resolve the CreditWatch listing by April 2009, if not earlier, based on a full review of the issuer's plans and progress in addressing its 2009 maturities. S&P could affirm the rating if the company is able to raise US$2.0 billion or so to cover its 2009 maturities shortfall and if it demonstrates progress in refinancing its maturities due 2010. Nevertheless, if Cemex is unable to raise this amount by April 2009, the company's refinancing risk will increase and liquidity will weaken further, which could result in a multiple-notch downgrade. The ratings assigned to Cemex reflect S&P's expectations that the company's 2009 financial performance will be under a great deal of pressure, especially in light of the worsening of worldwide economic conditions. About 74% of the company's revenue is concentrated in the U.S., Mexico, and Spain--all of which S&P expects to record negative growth this year. This will translate into lower volumes and cash flow generation compared with 2008. As a result, S&P believes that the financial target of the ratio of funds from operations-to-adjusted net debt in 2009 will be below S&P's expected 2008 ratio of 15%. S&P believes that Cemex's 2009 shortfall will be US$1.8 billion to US$2.0 billion. ===================== S W I T Z E R L A N D ===================== HYUNDAI SUISSE: Creditors Must File Proofs of Claim by March 31 --------------------------------------------------------------- Creditors owed money by JSC Hyundai Suisse are requested to file their proofs of claim by March 31, 2009, to: JSC Alcadis Logistics & Services Liquidator Brandbachstrasse 6 8305 Dietlikon Switzerland The company is currently undergoing liquidation in Dietlikon ZH. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on Jan. 20, 2008. INVESLINK LLC: Deadline to File Proofs of Claim Set March 31 ------------------------------------------------------------ Creditors owed money by LLC Inveslink are requested to file their proofs of claim by March 31, 2009, to: Dorfstrasse 38 6340 Baar Switzerland The company is currently undergoing liquidation in Baar. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on Jan. 13, 2009. KUPAT BETEILIGUNG: Creditors Have Until March 14 to File Claims --------------------------------------------------------------- Creditors owed money by JSC Kupat Beteiligung are requested to file their proofs of claim by March 14, 2009, to: JSC HPF Dynamostrasse 5 5400 Baden Switzerland The company is currently undergoing liquidation in Uitikon. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on Nov. 11, 2008. LOTHOS JSC: Proof of Claim Filing Deadline is April 8 ------------------------------------------------------ Creditors owed money by JSC Lothos are requested to file their proofs of claim by April 8, 2009, to: Heiniger Thomas and Ebnat-Kappel JSC Fischer+Partner Treuhand Volkshausstrasse 20 9630 Wattwil Switzerland The company is currently undergoing liquidation in Jonschwil. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on Dec. 18, 2008. MAKUMED JSC: Creditors' Proofs of Claim Due by March 18 ------------------------------------------------------- Creditors owed money by JSC MakuMed are requested to file their proofs of claim by March 18, 2009, to: Company Gisler & Partner Klosterhofstrasse 12 8598 Bottighofen Switzerland The company is currently undergoing liquidation in Tagerwilen. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on Jan. 21, 2009. SCHELLENBERG HOLDING: April 14 Set as Deadline to File Claims ------------------------------------------------------------- Creditors owed money by JSC Schellenberg Holding are requested to file their proofs of claim by April 14, 2009, to: JSC Kuhn Treuhand Muhlebachstr. 172 Mail Box 8034 Zurich Switzerland The company is currently undergoing liquidation in Zug. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on Jan. 14, 2009. SEMA SERVICE: Creditors Must File Proofs of Claim by March 13 ------------------------------------------------------------- Creditors owed money by JSC SEMA Service und Handel are requested to file their proofs of claim by March 13, 2009, to: Mario Stehrenberger Liquidator Rotwaldstrasse 2a 9602 Bazenheid SG Switzerland The company is currently undergoing liquidation in Kirchberg SG. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on Nov. 4, 2008. =========== T U R K E Y =========== FINANSAL KIRALAMA: Fitch Affirms Issuer Default Rating at 'BB' -------------------------------------------------------------- Fitch Ratings has affirmed the Long-term Issuer Default Rating of Turkey-based Is Finansal Kiralama A.S. (Is Leasing) at 'BB' with a Stable Outlook. Is Leasing is the 58%-owned subsidiary of Turkiye Is Bankasi A.S. (Isbank, rated 'BB'). Its IDRs are aligned with Isbank's ratings because Fitch believes Isbank would have a high propensity to provide timely support to Is Leasing, should it be needed. Is Leasing is part of the 'Is' brand and generates around half of its business from Isbank customers and the wider Is Group of companies. It is highly integrated with Isbank in terms of risk management, operations, IT and human resources. Isbank is technically restricted in the amount of capital and liquidity it can provide Is Leasing by prudential regulations. However, the size difference is such (Isbank had TRY100 billion of assets and TRY11 billion of equity at end-H108 compared with Is Leasing which had TRY1.2 billion of assets and TRY263 million of equity) that this is not presently a concern. The rating actions with respect to Is Leasing are: -- Long-term foreign currency IDR: affirmed at 'BB' with a Stable Outlook -- Short-term foreign currency IDR: affirmed at 'B' -- Long-term local currency IDR: affirmed at 'BBB-' (BBB minus) with a Stable Outlook -- Short-term local currency IDR: affirmed at 'F3' -- National Long-term Rating: affirmed at 'AAA(tur)' with a Stable Outlook -- Support Rating: affirmed at '3'. ============= U K R A I N E ============= ALDK GROUP: Creditors Must File Claims by March 11 -------------------------------------------------- Creditors of LLC Aldk Group (EDRPOU 33211112) have until March 11, 2009, to submit proofs of claim to: N. Martynenko Insolvency Manager Office 5 Mayakovsky Avenue 12 69035 Zaporozhye Ukraine The Economic Court of Zaporozhye commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No 19/37/09. The Court is located at: The Economic Court of Zaporozhye Shaumian St. 4 69001 Zaporozhye Ukraine The Debtor can be reached at: LLC Aldk Group Gorky St. 71 69002 Zaporozhye Ukraine AZOVSTAL JSC: Bad Macroeconomic Environment Cues S&P's Junk Rating ------------------------------------------------------------------ Standard & Poor's Ratings Services said that it had lowered its foreign currency long-term corporate credit rating on Ukrainian steel producer JSC Azovstal Iron and Steel Works to 'CCC+' from 'B' and its local currency long-term corporate credit rating to 'B-' from 'B' and removed them from CreditWatch following its downgrade of the sovereign rating on Ukraine. The outlook, which was negative before the CreditWatch placement, remains negative. The ratings had been placed on CreditWatch with negative implications on Feb. 17, 2009. S&P also lowered the rating on the senior unsecured debt issued by Azovstal Capital B.V. to 'CCC' from 'B-' and removed it from CreditWatch. The recovery rating is unchanged at '5', indicating S&P's expectation of modest (10%-30%) recovery for senior noteholders in the event of a payment default. "The downgrade reflects Ukraine's worsening macroeconomic environment, highlighted by S&P's downgrade of the sovereign," said Standard & Poor's credit analyst Andrey Nikolaev. "We also note that the decline in sovereign credit quality could hamper access to financing for Azovstal and its parent Metinvest B.V., particularly given currently difficult global financial markets." The foreign currency rating is capped by S&P's transfer and convertibility assessment on Ukraine, which reflects Standard & Poor's view of the likelihood of the Ukrainian government or central bank restricting nonsovereign access to foreign exchange needed for debt service. The ratings continue to reflect Azovstal's stand-alone credit quality, as well as expected ongoing and extraordinary support from its parent, Metinvest, which controls about 97% of the company. Azovstal is Metinvest's largest asset and generated about 25% of the group's EBITDA in 2008. The ratings are further pressured by the current very weak global steel industry conditions, the company's weak liquidity, volatile cash flow generation, and aged asset base that requires large capital expenditures. These risks are somewhat tempered by Azovstal's high proportion of exports; access to low-cost resources in Ukraine, further reinforced by hryvnia devaluation; and vertical integration in iron ore, coke, and scrap at the parent level. Azovstal's liquidity largely depends on that of the group as a whole. As of Dec. 31, 2008, Metinvest had about US$0.7 billion of term loans maturing in 2009 versus cash of about US$0.5 billion deposited with Western European banks and another US$0.2 billion with a related party bank. "The outlook is negative because of our concerns regarding the impact of deterioration in Ukraine's economic environment on Azovstal's credit quality," said Mr. Nikolaev. Further deterioration in steel industry conditions or the company's inability to roll over trade-finance lines or manage its working capital could also put pressure on the ratings in the future. S&P could revise the outlook to stable -- and ultimately to positive -- after the Ukrainian environment and steel industry conditions stabilize, because Azovstal's business mix could theoretically support a higher rating. BUILDING UNIVERSAL: Court Starts Bankruptcy Procedure ----------------------------------------------------- The Economic Court of Dnepropetrovsk commenced bankruptcy supervision procedure on LLC Building Universal Group (EDRPOU 34883723). S. Tchikildina is the temporary insolvency manager. The Court is located at: The Economic Court of Dnepropetrovsk Kujbishev St. 1a 49600 Dnepropetrovsk Ukraine The Debtor can be reached at: LLC Building Universal Group Office 303 20 Years of Victory St. 26 49127 Dnepropetrovsk Ukraine CENTRAL EUROPEAN: S&P Cuts Corporate Credit Ratings to 'BB-' ------------------------------------------------------------ Standard & Poor's Ratings Services said it lowered to 'BB-' from 'BB' its long-term corporate credit ratings on Bermuda-based emerging markets TV broadcaster Central European Media Enterprises Ltd. At the same time, S&P lowered to 'BB-' from 'BB' S&P's debt ratings on CME's US$475 million senior secured convertible notes due 2013, its EUR245 million notes due 2012, and EUR150 million notes due 2014. In addition, all of the ratings on CME were placed on CreditWatch with negative implications. "The downgrade and CreditWatch placement primarily reflect Standard & Poor's assessment of a rapidly deteriorating operating environment at many of CME's business units, including very sharp declines recently in the local currencies of Central and Eastern European countries where CME generates cash," said Standard & Poor's credit analyst Manuela Gabetta. The bulk of the group's debt is generated in euro and dollar. As a result, in S&P's view, a further deterioration in the group's credit metrics is likely in 2009. S&P will reassess the CreditWatch placement primarily based on the evolution of the group's liquidity profile with reference to these main aspects: -- CME's capacity to curtail possible cash burn in its start-up assets, notably Ukraine; and -- A more clear assessment of potential restructuring benefits in 2009, notably in terms of reducing the break-even point of its operations. S&P will also bases its reassessment on S&P's view of the long- term sustainability of CME's capital structure in the context of the generally depressed macroeconomic conditions. In the absence of a more negative assessment on liquidity, any potential downgrade will likely be limited to one notch given the group's leading position in its core markets, which could partially mitigate the impact of the economic downturn. DRUZHBA BREAD: Creditors Must File Claims by March 11 ----------------------------------------------------- Creditors of Joint Enterprise Druzhba Bread Plant (EDRPOU 30084100) have until March 11, 2009, to submit proofs of claim to: S. Poliakov Insolvency Manager Novomestenskaya St. 10/31 40030 Sumy Ukraine The Economic Court of Sumy commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No 4/78-08. The Court is located at: The Economic Court of Sumy Shevchenko Avenue 18/1 40011 Sumy Ukraine The Debtor can be reached at: Joint Enterprise Druzhba Bread Plant K. Mark lane 5 Druzhba Yampolsky district Sumy Ukraine MOTORCAR ENTERPRISE 14827: Claims Filing Deadline Set March 11 -------------------------------------------------------------- Creditors of OJSC Motorcar Enterprise 14827 (EDRPOU 03117843) have until March 11, 2009, to submit proofs of claim to: L. Timofeyeva Insolvency Manager Post office Box 179 54017 Nikolayev Ukraine The Economic Court of Nikolayev commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. 5/307/08. The Court is located at: The Economic Court of Nikolayev Admiralskaya St. 22-a 54009 Nikolayev Ukraine The Debtor can be reached at: OJSC Motorcar Enterprise 14827 Komintern St. 34 54031 Nikolayev Ukraine NIKOLAYEV MANUFACTURES: Creditors Must File Claims by March 12 -------------------------------------------------------------- Creditors of LLC Nikolayev Manufactures (EDRPOU 33250544) have until March 12, 2009, to submit proofs of claim to Insolvency Manager N. Derebchinsky. The Economic Court of Nikolayev commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No 5/342/08. The Court is located at: The Economic Court of Nikolayev Admiralskaya St. 22 54009 Nikolayev Ukraine The Debtor can be reached at: LLC Nikolayev Manufactures Hydrocomplex St. 4 Yuzhnoukrainsk 55001 Nikolayev Ukraine ORGTEKS LLC: Creditors Must File Claims by March 13 ---------------------------------------------------- Creditors of LLC Orgteks (EDRPOU 35008160) have until March 13, 2009, to submit proofs of claim to: LLC Production Enterprise Prikarpatye Insolvency Manager Kikvidze St. 26 01103 Kiev Ukraine The Economic Court of Kiev commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No 28/322-?. The Court is located at: The Economic Court of Kiev B. Hmelnitskiy St. 44-b 01030, Kiev Ukraine The Debtor can be reached at: LLC Orgteks Tchokolovsky Boulevard 19 03186 Kiev Ukraine SERBKA AGRICULTURAL: Creditors Must File Claims by March 12 ----------------------------------------------------------- Creditors of Agricultural LLC Serbka (EDRPOU 00855243) have until March 12, 2009, to submit proofs of claim to: S. Derkach Insolvency Manager Post Office Box 61 65065 Odessa Ukraine The Economic Court of Odessa commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No 2/128-08-2737. The Court is located at: The Economic Court of Odessa Shevchenko Avenue 29 65019 Odessa Ukraine The Debtor can be reached at: Joint Enterprise Druzhba Bread Plant Tsentralnaya St. 74-b Serbka Kominternovsky district 67510 Odessa Ukraine STIL LLC: Court Starts Bankruptcy Supervision Procedure ------------------------------------------------------- The Economic Court of Dnepropetrovsk commenced bankruptcy supervision procedure on LLC Stil (EDRPOU 32241193). The Temporary Insolvency Manager is: V. Androsova Office 112 Yangel St. 17 49089 Dnepropetrovsk Ukraine The Court is located at: The Economic Court of Dnepropetrovsk Kujbishev St. 1a 49600 Dnepropetrovsk Ukraine The Debtor can be reached at: LLC Stil Office 213 Fuchik St. 30 49027 Dnepropetrovsk Ukraine VINNITSA SOUTH: Court Starts Bankruptcy Supervision Procedure ------------------------------------------------------------- The Economic Court of Vinnitsa has commenced bankruptcy supervision procedure on LLC Vinnitsa South Trade (EDRPOU 23062436). The Temporary Insolvency Manager is: Y. Melnikov Office 117 Stakhursky St. 6 21100 Vinnitsa Ukraine The Court is located at: The Economic Court of Vinnitsa Hmelnitsky highway 7 21036 Vinnitsa Ukraine The Debtor can be reached at: LLC Vinnitsa South Trade Pirogov St. 31 21018 Vinnitsa Ukraine * Moody's Reviews Ratings on Republic of Ukraine for Likely Cuts ---------------------------------------------------------------- Moody's Investors Service put these ratings of the Republic of Ukraine under review for possible downgrade: the foreign and local currency government bond ratings (B1) and the foreign currency country ceilings for bonds (Ba3) and bank deposits (B2). "The rating action reflects concerns about how persistent political uncertainty clouds the prospects for an orderly resolution of banking problems, in the context of a severe economic downturn," said Jonathan Schiffer, Senior Credit Officer in Moody's Sovereign Risk Group. The rating review will focus on two main issues, in an attempt to identify possible sources of credit risk stabilization. First, in a context of heightened financial volatility, the review will concentrate on the policy direction of both the government and the National Bank of Ukraine in dealing with the stresses on the country's financial system and currency and will aim to determine whether there is scope for reliable external financing from the multilaterals. Second, the review will analyze the trends extant in the macroeconomy and the possibilities open to the government and National Bank to stabilize the economy and prevent a further deterioration of economic performance over the medium term. Schiffer noted that while there have been manifestations of support by parent (European) banks to Ukrainian banks and while the bank recapitalization scheme seems, to date, to imply lower- than-expected costs for the government's balance sheet, the stabilization of the banking system remains key to the sovereign credit outlook. In recent months, weaknesses in the financial system and local currency have necessitated various interventions by the National Bank of Ukraine. The nature of some of these interventions -- such as a partial bank deposit freeze -- suggests an orientation towards regulatory interventions that might have consequences for sovereign credit ratings. Moody's will attempt to assess the risk of administrative measures that may be detrimental to creditors' interests should the economy deteriorate further. Both the National Bank of Ukraine and the government have differed with the IMF on the latter's policy prescriptions with reference to the exchange rate regime and budgetary assumptions and deficit. Moody's rating review will examine whether or not these disagreements can be resolved in a constructive manner such that the IMF package continues to function effectively. "In recent years, Ukraine's political spectrum has generated considerably 'noise'," said Schiffer. Moody's review will analyze whether or not continued political infighting, reflecting lack of institutional and constitutional clarity on rights and responsibilities of different branches of government, will have both direct and indirect affects on macroeconomic policy such that general confidence of both residents and non-residents in the ability of Ukraine to manage this complicated conjuncture in an efficient manner is undermined. Moody's review will be completed within three months. During this time, the rating agency will monitor closely the government and National Bank of Ukraine's economic policies and strategy in response to the many, difficult obstacles and challenges that face the country. Moody's last rating action with respect to the Republic of Ukraine occurred on October 20, 2008, when the outlook on all major sovereign ratings was changed to stable from positive. * Moody's Reviews 'B1' Issuer Ratings of Three Ukrainian Cities --------------------------------------------------------------- Moody's Investors Service has placed the B1 foreign and local currency issuer ratings of the City of Kyiv, City of Kharkiv and City of Berdyansk (Ukraine) under review for possible downgrade. The agency has also placed Kyiv's B1 foreign currency loan participation note ratings, and Berdyansk's B1 global scale and Aa3.ua national scale debt ratings under review for possible downgrade. "The rating action reflects a possible weakening of stand-alone creditworthiness of Ukrainian municipalities stemming from a sharp deterioration in domestic economic and financial market conditions," explains Alexander Proklov, a Moody's senior analyst and lead analyst for Kyiv, Kharkiv and Berdyansk. The rating action follows Moody's recent decision (February 24, 2009) to place the Ukrainian government's ratings on a review for possible downgrade. Moody's understands that the current global turmoil has led to numerous negative implications on both the national and local levels. "Ukrainian municipalities are being adversely impacted by a budget revenue slump resulting from the significant decline in economic activity," says Mr. Proklov. "Indeed, the shortfall in tax proceeds coupled with limited flexibility in the expenditure base could lead to a material deterioration in operating balances in 2009." Furthermore, the transfers from the national to municipal level could decrease due to the central government's high budgetary deficit, which could exert additional pressure on the municipal budgets. Moody's notes that, under the current tight financial market conditions, the rated local authorities could find it difficult to finance needed infrastructure projects through new borrowings. "Refinancing risk, however, is partially mitigated by a favourable maturity debt profile," adds Mr Proklov. The rating review for the three cities will focus on the severity of the budgetary and financial challenges, and the cities' ability to manage these pressures and avoid a structural impairment in their debt service capacity. The last rating action on Kyiv was implemented on October 20, 2008, when Moody's changed Kyiv's outlook to stable. The last rating action on Kharkiv was implemented on December 15, 2006, when Moody's upgraded the city's issuer rating to B1. The last rating action on Berdyansk was implemented December 22, 2006, when Moody's assigned provisional ratings of B1/Aa3.ua (Ukraine national rating scale) to the city's UAH10 million (EUR1 million) bond due 2012. =========================== U N I T E D K I N G D O M =========================== ARNGROVE GROUP: Appoints Administrators from Grant Thornton ----------------------------------------------------------- Joseph Peter Francis McLean and Keith Hinds of Grant Thornton UK LLP were appointed joint administrators of Arngrove Group Holdings Ltd. on Feb. 17, 2009. The company can be reached at: Arngrove Group Holdings Ltd. Properties House Easter Park Teesside Industrial Park Thornaby Stockton on Tees Cleveland TS17 9NT England BRAPACK LTD: Taps Joint Administrators from Tenon Recovery ---------------------------------------------------------- Alexander Kinninmonth and Nigel Ian Fox of Tenon Recovery were appointed joint administrators of Brapack Ltd. on Feb. 16, 2009. The company can be reached through Tenon Recovery at: Highfield Court Tollgate Chandlers Ford Eastleigh Hampshire SO53 3TZ England CASTLEMORE SECURITIES: Goes Into Administration; 700 Jobs at Risk ----------------------------------------------------------------- West Midlands-based developer Castlemore Securities has gone into administration, putting 700 jobs at risk. According to the report, the company, which is behind the latest GBP200 million development of Temple Quay's in Bristol, opted to called in administrators after being hit by the credit crunch. Castlemore, the report discloses, was founded by Graeme Whateley in 1971. EDWARDS GROUP: S&P Puts 'B+' Corp. Credit Rating on Negative Watch ------------------------------------------------------------------ Standard & Poor's Ratings Services said it placed its 'B+' long- term corporate credit rating on U.K.-based Edwards Group Ltd., a leading worldwide supplier of vacuum technology, on CreditWatch with negative implications. At the same time, S&P placed the issue ratings on the loans and credit facility of related entity Edwards (Cayman Islands II) Ltd. on CreditWatch with negative implications. On Sept. 30, 2008, Edwards had on-balance-sheet gross debt of US$656 million. "The CreditWatch placement reflects our opinion that Edwards' operating margins and credit measures will likely weaken materially in 2009 because S&P expects the sharp decline of global semiconductor equipment sales to continue," said Standard & Poor's credit analyst Matthias Raab. In the first nine months of 2008, Semi Equipment, Edwards' largest segment, contributed 46% of sales. S&P believes that revenues from Edwards' profitable services and spare parts business could also decline. Moreover, S&P expects lower sales from Edwards' General Vacuum Equipment segment as a result of the general macroeconomic downturn, and the company may incur further significant restructuring costs as it aligns its cost structure to falling demand. Consequently, Edwards' currently solid liquidity could gradually diminish during 2009, owing to significant negative free cash flows. S&P is uncertain to what extent the company's ongoing restructuring, lower capital expenditures, and positive working capital movements will support liquidity as sales decline. S&P expects inventory management and customer collections to be key challenges in the coming months, given the speed and intensity of order declines. Lease-adjusted gross debt to last-12-months EBITDA was already high at 5.0x on Sept. 30, 2008 (4.1x on a net debt basis) and could deteriorate significantly in 2009, in S&P's opinion, as profits decline. "We intend to resolve the CreditWatch placement over the next three months, after reviewing the company's 2008 results and prospects for 2009," said Mr. Raab. "In particular, S&P will discuss with Edwards' management the negative implications of the expected downturn on revenues and the company's ability to cut costs and capital expenditures to preserve its liquidity profile. S&P will also discuss to what extent the company's cash flow generation could be affected from its recently implemented and new restructuring programs, working-capital changes, and the recent weakness of the British pound against the U.S. dollar, euro, and Japanese yen." A downgrade by one notch appears possible, given the rapidly deteriorating operating environment, fierce margin pressures, deteriorating credit measures, and expected negative free cash flow generation. S&P is unlikely to downgrade Edwards by more than one notch, however, in view of its long-term capital structure and currently still supportive liquidity profile. KW LINFOOT: Goes Into Administration ------------------------------------ Doug Morrison and David Doyle at Property Week report that Leeds- based property developer KW Linfoot has gone into administration after being hit by the difficulty in securing debt finance and the reduction in people completing the purchase of apartments in its schemes. BWC Solutions has been appointed administrator, the report says. However, the report notes the company's Lumiere and Manor Mills developments in Leeds, and its Manyoo scheme in Manchester, are unaffected by the administration. These will be taken over by the the company's joint venture partners, Frasers and John Hitchcox's Yoo, the report states. The report discloses a company statement said "The board recognized the problems in the market and UK banking sector some 12 months ago and since then has been actively seeking alternative funding routes." The company, as cited by the report, said it held talks with overseas investors willing to invest GBP50 million into its schemes, but potential deals fell through because of the lack of bank funding. The report relates the company has reduced its debt in advance of the administration following a large capital injection from principle shareholder and founder Kevin Linfoot. The company, the report adds, has also reduced the number of its employees from 34 to ten. NIGEL ESTATE: Closes Eight Sales Offices; 18 Jobs Affected ---------------------------------------------------------- Devon-based Nigel Green Estate Agents has closed its eight sales offices, resulting in the loss of 18 jobs, BBC News reports The report however notes a spokesperson for the company said clients with properties under offer will still have sales proceed. Nigel Green, the report relates, went into administration on February 6. The report discloses business recovery firm Lameys were called in to try to save the sales side of the business. "We all know that the housing sales market is shrinking rapidly in the current recession which unfortunately compromised this business, necessitating my appointment," the report quoted Michelle Weir, of Lameys, as saying. "At the same time, the recession has increased interest in the rental sector and therefore I am able to keep this side of the business operational and it has attracted strong interest from the market." According to the report, property consultancy firm Edward Symmon, which was tasked to find a buyer for Nigel Green, had only received offers for parts of the business, rather than the entire operation. Nick Wheeldon, as cited by the report, said "We have had several good offers for the property rental business a nd we expect negotiations to be concluded in the very near future." PACKAGING FACTORY: Goes Into Administration; 30 Jobs At Risk ------------------------------------------------------------ Liz Wells at Packaging News reports that Hampshire-based The Packaging Factory has gone into administration, putting 30 jobs at risk. Paul Boyle and John Sallabank from Harrisons were appointed administrators of the company, the report discloses. The report relates that according to a spokesperson for the administrators, the company was still trading but was being funded by an unnamed third party while a buyer for the business was sought. Established in 1985, The Packaging Factory provides services including design, printing, filling, hand packing, blister packing and shrink wrapping, the report notes. PROPINVEST: Debt Restructuring May Be Delayed --------------------------------------------- Deirdre Hipwell at Property Week reports that a restructuring plan for Propinvest, Glenn Maud's Gemini Eclipse commercial mortgage- backed securities vehicle, may be put on hold after senior noteholders ousted the portfolio's special servicer. Property Week relates on Wednesday controlling class E senior noteholders,including Rivlin's Palatium Investment Management, voted to replace current special servicer Barclays Capital Mortgage Servicing (BCMS), which outlined the restructuring proposal, with CB Richard Ellis Loan Servicing as special servicer. The class E noteholders hold GBP75 million of the senior notes, Property Week adds. Barclays, the Daily Teleraph discloses, is the manager of a GBP850 million loan that breached its terms last July. The loan, which is secured against Propinvest's 35 commercial properties, was made in August 2006, the Daily Telegraph says. Bloomberg News, citing a quarterly report from Barclays, notes the properties backing the loan were valued at GBP1.2 billion in July 2007. The last reported valuation was GBP801 million on Sept. 26, according to a Regulatory News Service statement, which was 6 percent less than the loan's value, Bloomberg News relates. Bloomberg News recounts that in a Feb. 20 statement Barclays said that it was proposing a restructuring to halt further breaches because Propinvest, "is not in a position to provide further equity support" for the loan. However, senior noteholders claim that Barclays, which is paid GBP2.1 million a year as special servicer, did not consult them on the restructuring proposal, which junior creditors have agreed to, the Daily Telegraph states. Property Week discloses that according to Barclays the proposal would maximize cashflow and income revenue; build reserves to meet senior loan interest payments and avoid fire sales. It added it would also avoid crystallizing GBP119.5 million of super senior termination payments on junior and senior hedging arrangements. Barclays warned if it was removed as special servicer it would take no further steps to implement it as it would expect CBRE to form its 'own view on the merits' of the proposal, Property Week notes. ROYAL BANK: U.K. Gov't Agrees to Provide Additional Funding ----------------------------------------------------------- The U.K. government agreed to provide The Royal Bank of Scotland Group plc with as much as GBP25.5 billion (US$36.64 billion) in capital and insure GBP300 billion of the bank's assets, The Wall Street Journal reports. The move, according to the Journal, could increase the government's economic stake in the bank to as much as 95% from the current 70%. The recent help given to RBS is part of U.K.'s GBP500 billion bank-insurance plan announced in January. Under the funding agreement, the Journal discloses RBS will pay a fee of GBP6.5 billion to participate in the insurance plan. The bank will also absorb the first GBP20 billion in losses on the GBP300 billion asset pool before the insurance kicks in, and will be responsible for 10% of subsequent losses, the Journal relates. RBS will also pay the insurance fee, and raise an additional GBP13 billion in fresh capital, by issuing special "B" shares to the government, the Journal says. Huge Loss As reported in the Troubled Company Reporter-Europe on Feb. 27, RBS incurred a GBP24.0 billion net loss for the full year ending Dec. 31, 2008 from a net income of GBP6.8 billion in 2007. Total income for 2008 decreased 20% to GBP26.8 billion from GBP33.5 billion in 2007. The losses, the Journal says, stemmed from some GBP15 billion in impairment charges on bad loans and trading losses, and from a goodwill write-down related to its decision to lead the 2007 takeover of Dutch bank ABN AMRO Holding N.V. RBS's balance sheet as of Dec. 31, 2008 showed total assets of GBP2.2 trillion, total liabilities of GBP2.1 trillion and total equity GBP64.3 billion. Job Cuts, Asset Sale To correct factors that made its business particularly vulnerable to the downturn, RBS plans to create a "non-core" division during the second quarter, separately managed, but within the existing legal structures of the Group and matrix-managed to donating divisions where necessary. This division will have approximately GBP240 billion of third party assets, GBP145 billion of derivative balances and GBP155 billion of risk-weighted assets, RBS said. As part of this effort, RBS said it is intended that the Group's representation in approximately 36 of the 54 countries where it operates will be significantly reduced or sold. The income, expenses, impairments and credit market and other trading asset write-downs associated with the non-core division in 2008 were approximately GBP3.9 billion, GBP1.1 billion, GBP3.2 billion and GBP9.2 billion respectively. In addition, RBS said the Group aims of achieving run-rate reductions by 2011 of greater than GBP2.5 billion (16% of 2008 cost base) at constant exchange rates, a process which will involve reductions in employment. As reported in the Troubled Company Reporter-Europe on Feb. 19, 2009, The Sunday Times said RBS intends to cut a further 10,000 to 20,000 jobs as part of its cost-cutting measures. The Times recalled RBS already axed 13,000 jobs internationally since last April, including 3,000 in its investment-banking business. Bloomberg News relates the bank this month said it plans to cut 2,300 jobs in Britain, in addition to about 2,700 jobs at its global banking and markets unit. About RBS The Royal Bank of Scotland Group plc (NYSE:RBS) -- http://www.rbs.com/-- is a holding company of The Royal Bank of Scotland plc (Royal Bank) and National Westminster Bank Plc (NatWest), which are United Kingdom-based clearing banks. The company's activities are organized in six business divisions: Corporate Markets (comprising Global Banking and Markets and United Kingdom Corporate Banking), Retail Markets (comprising Retail and Wealth Management), Ulster Bank, Citizens, RBS Insurance and Manufacturing. On October 17, 2007, RFS Holdings B.V. (RFS Holdings), a company jointly owned by RBS, Fortis N.V., Fortis SA/NV and Banco Santander S.A. (the Consortium Banks) and controlled by RBS, completed the acquisition of ABN AMRO Holding N.V. (ABN AMRO). In July 2008, the company disposed its entire interest in Global Voice Group Ltd. WINDCROWN LTD: Taps Joint Administrators from PKF ------------------------------------------------- Charles William Anthony Escott and Ian Christopher Schofield of PKF (UK) LLP were appointed joint administrators of Windcrown Ltd. on Feb. 9, 2009. The company can be reached through PKF (UK) LLP at: Pannell House 6 Queen Street Leeds LS1 2TW England WINDERMERE XIV: S&P Lifts Ratings on Class E and F Notes to 'BB' ---------------------------------------------------------------- Standard & Poor's Rating Services raised its ratings on the class E and F notes issued by Windermere XIV CMBS Ltd. to 'BB' and 'B', respectively, from 'D'. This follows the payment in full of current and previously unpaid interest on these notes at the latest interest payment date. At the same time, S&P placed the notes on CreditWatch negative to reflect the current counterparty risk owing to the insolvency of the swap counterparty, Lehman Brothers Holdings Inc. The ratings on the other classes in the transaction are unaffected. S&P downgraded the class E and F notes to 'D' in December 2008 following a note interest shortfall that occurred for reasons connected with the Lehman insolvency, including nonpayment under the swaps. As a result, the cash manager drew liquidity to meet shortfalls in interest due under the class A to D notes but not the class E and F notes. Since then, S&P understand that the liquidity documentation has been amended to clarify that liquidity will be available for the class E and F notes. As a consequence, on the January interest payment date the interest due on the class E and F notes was paid in full and the October shortfall was made whole. Total liquidity facility drawings currently stand at EUR2.3 million. S&P understand that the issuer and its financial adviser (J.C. Rathbone & Associates Ltd.) expect to replace the issuer- level swaps by the next interest payment date in April. Depending on the new swap arrangements, there are scenarios in which sufficient excess cash may be generated to repay the liquidity facility that was tapped as a result of the Lehman insolvency. Notwithstanding these positive factors, S&P consider that the creditworthiness of some of the loans has deteriorated, namely the Queen Mary and Sisu loans. Both mature in 2012 and are "sell- down" transactions, involving property sales. Given the size of the Sisu loan -- relative to the loan pool and to its narrow real estate market, Finland -- and the signs that the business plan for the Queen Mary loan is behind schedule (according to current vacancy rates and property sales achieved thus far), S&P consider that achieving sales in the current environment has become more difficult and that losses may be experienced as a result. Accordingly, S&P has raised these notes to 'BB' and 'B', rather than to their pre-December levels of 'BBB' and 'BB', respectively. Ratings List Windermere XIV CMBS Ltd. EUR1,111,835,000 Commercial Mortgage-Backed Floating-Rate Notes Class Rating ----- ------ To From -- ---- Ratings Raised And Placed On CreditWatch Negative E BB/Watch Neg D F B/Watch Neg D * U.K.: Economy Shrinks 1.5% in the Fourth Quarter -------------------------------------------------- The U.K. economy contracted the most since 1980 in the fourth quarter as gross domestic product fell 1.5 percent from the third quarter, Bloomberg News reports citing the Office for National Statistics. On the year, GDP fell 1.9 percent, the report says. "The U.K. economy is certainly in a recession if not a mini depression," the report quoted Neil Mackinnon, chief economist at ECU Plc in London and a former U.K. Treasury official, in an interview on Bloomberg Television. "Things are likely to get worse before they get better." According to the report, data from the statistics office showed consumer spending declined 0.7 percent on the quarter, the most since 1991, while fixed investment dropped 2.3 percent. Industrial production dropped 4.5 percent in the quarter, compared with a previous estimate of 3.9 percent, while manufacturing fell 5.1 percent, down from an estimate of 4.6 percent, the report relates citing data from the statistics office. * S&P Takes Rating Actions on 368 European Synthetic CDO Tranches ----------------------------------------------------------------- Standard & Poor's Ratings Services took credit rating actions on 368 European synthetic collateralized debt obligation tranches. Specifically, the ratings on: -- 271 tranches were lowered; -- 73 tranches were lowered and remain on CreditWatch negative; -- 23 tranches were placed on CreditWatch negative; and -- One tranche was raised. Of the 367 tranches lowered and/or placed on CreditWatch negative: -- 19 reference U.S. residential mortgage-backed securities and U.S. CDOs that are exposed to U.S. RMBS, which have experienced negative rating actions; and -- 348 have experienced corporate downgrades in their portfolio. The rating actions are part of S&P's regular monthly review of synthetic CDOs. These actions incorporate, among other things, the effect of recent rating migration within reference portfolios and recent credit events on several corporate entities. This table provides a summary of the rating actions S&P has taken on European synthetic CDO tranches since June 2008. Downgrades Upgrades (no. of (no. of Key corporate tranches) tranches) downgrades* ---------- --------- ------------- Jul-08 44 41 Radian Asset Assurance Inc. (AA/Watch Neg to A/Watch Neg) June 16, 2008 Countrywide Home Loans, Inc. (BB+/Watch Dev to AA/Negative) July 1, 2008 Aug-08 75 27 Residential Capital, LLC (SD to CCC+/Negative) July 15, 2008 Louisiana-Pacific Corp. (BBB-/Negative to BB+/Watch Neg) July 29, 2008 Sep-08 38 0 Radian Group Inc. (BBB/Watch Neg to BB+/Negative) Aug. 26, 2008 PMI Group Inc. (BBB+/Negative to BBB-/Watch Neg) Aug. 26, 2008 Oct�08 77 0 Lehman Brothers Inc. (A+/Negative to A+/Watch Neg) Sept. 9, 2008 (A+/Watch Neg to BB-/Watch Dev) Sept. 15, 2008 (BB-/Watch Dev to D) Sept. 23, 2008 Washington Mutual, Inc. (BBB-/Negative to BB-/Negative) Sept. 15, 2008 (BB-/Negative to CCC/Negative) Sept. 24, 2008 (CCC/Negative to D) Sept. 26, 2008 American International Group Inc. (AA-/Watch Neg to A-/Watch Neg) Sept. 15, 2008 Nov�08 791 0 Fortis N.V. (A-/Developing to BBB-/Watch Neg) Oct. 6, 2008 Glitnir Bank (CCC/Watch Neg to D) Oct. 9, 2008 Dec-08 396 8 Residential Capital, LLC (CCC-/Negative to CC/Watch Neg) Nov. 20, 2008 Financial Guaranty Insurance Co. (BB/Watch Neg to CCC/Negative) Nov. 24, 2008 Clear Channel Communications Inc. (B to CC) Dec. 5, 2008 Jan-09 253 2 Citigroup Inc. (AA-/Watch Neg to A/Stable) Dec. 19, 2008 Morgan Stanley (A+/Negative to A/Negative) Dec. 19, 2008 Feb-09 344 1 MBIA Inc. (A-/Negative to BB+/Negative) Feb. 18, 2009 MBIA Insurance Corp. (AA/Negative to BBB+/Negative) Feb. 18, 2009 * Corporate names that have experienced a significant notch downgrade, as well as being highly referenced within European synthetic CDOs. These rating actions and the CreditWatch updates follow two reviews. The first review was of the CreditWatch placements made on Feb. 11, 2009. For the second review, SROC (synthetic rated overcollateralization) is run for scenarios that project the current portfolio 90 days into the future, assuming no asset rating migration. For those transactions that have been on CreditWatch negative for longer than 90 days, where S&P has either not received material levels of information or relative portfolio credit quality has not improved since the CreditWatch placement to a level sufficient to affirm the rating, S&P has assessed portfolio credit quality and not run scenarios 90 days into the future. What Is Sroc? One of the main steps in S&P's rating analysis is the review of the credit quality of the securitized assets. SROC is one of the tools S&P use for this purpose when rating and surveilling ratings assigned to most synthetic CDO tranches. SROC is a measure of the degree by which the credit enhancement (or attachment point) of a tranche exceeds the stressed loss rate assumed for a given rating scenario. It is comparable across different tranches of the same rating. Changes in SROC capture any developments in the major influences on a tranche's creditworthiness: the credit quality of a reference portfolio, improvement or deterioration of ratings in the reference portfolio, credit events, and time decay. When SROC is 100%, there is exactly sufficient credit enhancement to maintain the rating on a tranche. When SROC is less than 100%, it indicates that the current credit enhancement may not be sufficient to maintain the current tranche rating. If the SROC is less than 100%, but the 90 day projection indicates that the SROC would return to a level above 100% at that time, S&P maintain the rating at its current level and it remains on CreditWatch negative. If, on the other hand, the projection indicates that the SROC would remain below 100%, S&P may lower the rating subject to S&P's criteria (see "Related Research"). If the current SROC of a tranche would be greater than 100% at a higher rating level than the current rating, S&P may upgrade subject to S&P's criteria. * Fitch Says 2009 Challenging Year for European Luxury Goods Firms ------------------------------------------------------------------ Fitch Ratings says that against a backdrop of declining disposable income and consumer confidence, larger European luxury goods and above-premium alcoholic beverages and cosmetics companies are likely to be cushioned from these effects by balanced capital structures and healthy legacy profit margins and cash flow generation. Conversely, Fitch expects smaller companies, typically characterized by lower product or geographical diversification and more limited financial flexibility, to be more negatively impacted by the current economic downturn. "Companies such as L'Oreal SA ('F1+'/Stable), Diageo plc ('A'/Negative/'F1'), LVMH ('BBB+'/Stable/'F2'), all have some financial headroom at their current rating level to protect their operations and credit quality during 2009, however rating headroom will be eroded over time as Fitch expects weakening operating performance this year," says Giulio Lombardi, Senior Director in Fitch's Corporate Finance team. "Fitch expects 2009 to be, with the exception of a few countries, a challenging year in terms of demand for luxury goods. These concerns are only partially mitigated by the fact that the Asian region, excluding Japan, and parts of South America could remain a positive contributor to the overall performance of the European luxury goods industry," says Johnny Da Silva, Director in Fitch's Corporate Finance team. Overall, Fitch believes the recently reported pressure on luxury goods companies' operating margins should continue through to 2010, due to the reduction of scale benefits from lower production, trading down by consumers in their choices and the need for companies to maintain momentum in product innovation and brand visibility. This pressure could be partially alleviated by a re-allocation of resources, including investments in communication, innovation, and new store openings, in favour of companies' core leading brands. Furthermore, to withstand the economic environment, large European luxury, alcoholic beverages and cosmetics groups, including LVMH, PPR, Diageo and L'Oreal have announced cost optimization programs. From a credit perspective, Fitch views positively measures recently introduced to protect credit quality, which include cutting down share buyback programs, as demonstrated by Diageo and L'Oreal, as well as higher discipline in the management of working capital. Also, as Fitch expects most of these companies to emphasize organic growth, acquisition risks should diminish. The impact of the financial crisis should, in the medium term, reinforce the dominance of the large international players and brands characterized by a wide and loyal customer base. Furthermore, with the exception of those companies that had major M&A activity in 2008 such as Pernod Ricard SA, ('BB+'/Negative/'B'), the agency notes that balanced capital structures are likely to provide support to the credit profiles of larger companies. The agency notes that smaller, less diversified industry players, who were already suffering from thin margins and low free cashflow generation are now experiencing more difficulty. Also, availability of liquidity is now becoming, in a more credit rationed environment, a major issue for these smaller companies. As an example, these issues have been key for UK-based luxury tableware company Waterford Wedgwood, which went into administration in January 2009. The impact of the global economic downturn highlights both geographic and product diversification as key factors of resilience. Results reported for 2008 highlight that during Q408, when the global financial crisis intensified, demand for luxury products experienced a particularly severe correction in the USA and Japan while already sluggish performance in western Europe was further exaggerated. However, demand remained buoyant for longer in Asia and parts of Eastern Europe and companies including L'Oreal SA, LVMH and Pernod Ricard were still able to maintain double digit revenue growth in 2008 in these regions. Sales performance also differed widely by product categories, for instance, sales of champagne were(down by 5% in 2008 and)luxury watches were also severely impacted, with Richemont for instance reporting a 11% fall in divisional sales at constant rates for the quarter ending 31 December 2008. Conversely, the most established international brands in the Fashion & Leather products category, including Hermes, LVMH's Louis Vuitton, PPR's Yves-Saint Laurent appear to be demonstrating resilience. In 2009, Fitch also notes that companies should benefit from improved pricing on their media and communication purchasing, and that the allocation of this expenditure will most likely be shifted in terms of geography and away from past rising "stars" in favour of the already well established brands. Fitch expects most luxury companies to maintain or only slightly reduce their typically high marketing and selling costs of between 20% and 30% of sales. * BOND PRICING: For the Week Feb. 23 to Feb. 27, 2009 ----------------------------------------------------- Issuer Coupon Maturity Currency Price ------ ------ -------- -------- ----- AUSTRIA ------- Oester Volksbk 6.600 05/06/23 EUR 106.52 4.000 12/14/23 EUR 80.75 4.260 03/22/24 EUR 83.02 BA Creditanstalt 5.210 12/21/22 EUR 92.69 Bank Austria AG 5.800 12/27/21 EUR 99.77 BELGIUM ------- Barry Calle SVCS 6.000 07/13/17 EUR 74.57 CYPRUS ------ Abh Financial Lt 8.200 06/25/12 USD 69.74 Alfa MTN Invest 9.250 06/24/13 USD 72.14 FRANCE ------ Alcatel SA 4.750 01/01/11 EUR 13.00 6.380 04/07/14 EUR 62.03 BNP Paribas 0.250 12/20/14 USD 70.68 Calyon 5.050 11/02/22 EUR 96.57 6.000 06/18/47 EUR 49.56 Credit Agricole 5.050 07/26/22 EUR 96.19 Credit Agricole 5.070 08/10/22 EUR 96.26 Soc Air France 2.750 04/01/20 EUR 18.64 Wavecom SA 1.750 01/01/14 EUR 30.60 GERMANY ------- Aareal Bank AG 6.570 05/04/26 EUR 103.11 GREECE ------ Antenna TV SA 7.250 02/15/15 EUR 52.63 HUNGARY ------- Agrokor 7.000 11/23/11 EUR 70.73 IRELAND ------- Allied Irish Bks 5.250 03/10/25 GBP 68.20 5.630 11/29/30 GBP 64.57 Alfa Bank 8.630 12/09/15 USD 51.50 Ardagh Glass 7.130 06/15/17 EUR 70.13 Banesto Finance Plc 6.120 11/07/37 EUR 6.12 Bank of Ireland 4.630 02/27/19 EUR 74.07 ITALY ----- Banca Italease 3.000 06/30/11 EUR 73.25 3.000 09/30/11 EUR 70.63 LUXEMBOURG ---------- Acergy SA 2.250 10/11/13 USD 65.02 Ak Bars Bank 9.250 06/20/11 USD 72.43 Alrosa Finance 8.880 11/17/14 USD 67.44 Bank of Moscow 7.340 05/13/13 USD 67.51 7.500 11/25/15 USD 53.16 6.810 05/10/17 USD 45.03 Beverage Pack 8.000 12/15/16 EUR 70.38 9.500 06/15/17 EUR 43.91 NETHERLANDS ----------- ABN Amro Bank NV 4.400 04/28/27 EUR 88.84 Achmea Hypobk 4.300 04/03/24 EUR 73.77 Achmea Hypobk 4.000 12/27/24 EUR 70.13 Aegon NV 6.130 12/15/31 GBP 71.50 Air Berlin Finance BV 1.500 04/11/27 EUR 35.10 Alfa Bk Ukraine 9.750 12/22/09 USD 57.96 ALB Finance BV 9.000 11/22/10 USD 29.96 9.750 02/14/11 GBP 23.75 7.880 02/01/12 EUR 24.63 9.250 09/25/13 USD 29.81 ASML Holding NV 5.750 06/13/17 EUR 67.89 ASM Intl NV 4.250 12/06/11 USD 70.96 Astana Finance 7.880 06/08/10 EUR 46.50 9.000 11/16/11 USD 99.53 ATF Capital BV 9.250 02/21/14 USD 56.16 BK Ned Gemeenten 0.500 06/27/18 CAD 70.66 0.500 02/24/25 CAD 48.25 Centercrdt Intl 8.000 02/02/11 USD 51.60 8.630 01/30/14 USD 35.72 Hit Finance BV 4.880 10/27/21 EUR 72.96 JSC Bank Georgia 9.000 02/08/12 USD 38.38 SPAIN ----- Abertis 5.990 05/14/38 EUR 72.63 Abertis Infra 4.380 03/30/20 EUR 77.25 Ayt Cedulas Caja 3.750 06/30/25 EUR 76.92 Banco Bilbao Viz 5.750 07/20/17 USD 111.58 6.200 07/04/23 EUR 88.15 Comunidad Aragon 4.820 10/10/22 EUR 102.15 Junta Andalucia 5.000 07/13/22 EUR 110.28 UNITED KINGDOM -------------- Alfa-Bank CJSC 9.250 07/26/10 USD 101.00 Amlin Plc 6.500 12/19/26 GBP 65.74 Anglian Water Finance Plc 2.400 04/20/35 GBP 46.97 Ashtead Holdings 8.630 08/01/15 USD 61.13 Aspire Defence 4.670 03/31/40 GBP 61.99 Aviva Plc 5.250 10/02/23 EUR 55.87 6.880 05/22/38 EUR 51.51 6.880 05/20/58 GBP 73.61 Azovstal 9.130 02/28/11 USD 33.81 Bank of India 6.630 09/22/21 USD 75.00 Barcklays Bk Plc 9.750 09/30/09 GBP 70.19 5.500 06/19/23 EUR 83.10 Beazley Group 7.250 10/17/26 GBP 71.83 Bradford&Bin Bld 5.500 01/15/18 GBP 19.94 5.750 12/12/22 GBP 24.92 6.630 06/16/23 GBP 24.91 4.910 02/01/47 EUR 60.53 BL Super Finance 4.480 10/04/25 GBP 73.82 Britannia Bldg 5.750 12/02/24 GBP 67.40 5.880 03/28/33 GBP 62.36 British Airways Plc 8.750 08/23/16 GBP 76.50 Brit Insurance 6.630 12/09/30 GBP 52.52 British Land Co 5.010 09/24/35 GBP 73.02 5.260 09/24/35 GBP 69.64 British Tel Plc 5.750 12/07/28 GBP 73.95 6.380 06/23/37 GBP 77.48 Broadgate Finance Plc 4.850 04/05/31 GBP 73.22 5.000 10/05/31 GBP 67.17 5.100 04/05/33 GBP 58.82 4.820 07/05/33 GBP 71.26 CGNU Plc 6.130 11/16/26 GBP 65.73 Heating Finance 7.880 03/31/14 GBP 45.38 ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers' public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than USUS$3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. A list of Meetings, Conferences and Seminars appears in each Thursday's edition of the TCR. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/booksto order any title today. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter -- Europe is a daily newsletter co- published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland USA. Valerie C. Udtuhan, Marites O. Claro, Rousel Elaine C. Tumanda, Pius Xerxes V. Tovilla, Joy A. Agravante, Marie Therese V. Profetana and Peter A. Chapman, Editors. Copyright 2009. All rights reserved. ISSN 1529-2754. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR Europe subscription rate is USUS$625 per half-year, delivered via e-mail. 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