/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/090408.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 Wednesday, April 8, 2009, Vol. 10, No. 69 Headlines A U S T R I A GIG LLC: Claims Registration Period Ends April 21 GOVEDAR LLC: Claims Registration Period Ends April 21 GOZZOBURG KULTUR: Claims Registration Period Ends April 20 IMMOFINANZ GROUP: Seeks to Avert Insolvency Through Bond Swap LIFT LLC: Claims Registration Period Ends April 20 POWER BAU: Claims Registration Period Ends April 20 F R A N C E FCI INTERNATIONAL: Moody's Cuts Corporate Family Rating to 'B2' G E R M A N Y AABACH GRAPHIC: Claims Registration Period Ends May 18 COIFFEUR CHARMANT: Claims Registration Period Ends May 20 COMMERZBANK AG: May Sell Eurohypo Unit or Eastern European Ops DGTH PRODUKTIONS: Claims Registration Period Ends April 30 DPM ELECTRONIC: Claims Registration Period Ends May 8 EXXE GMBH: Claims Registration Period Ends May 8 INFINEON TECH: UBS Recommends "Buy" on Possible Gov't Funding PREMIERE AG: New Shares Offered 50% Lower Than Last Week's Close PROCREDIT HOLDING: Fitch Downgrades Individual Rating to 'D' H U N G A R Y MAGYAR TAKAREKSZOVETKEZETI: S&P Cuts Counterparty Rating to 'BB' MKB BANK: S&P Downgrades Public-Information Ratings to 'BBpi' I R E L A N D AER LINGUS: CEO Dermot Mannion Resigns CHARTBUSTERS: Gets Court Permission to Revoke Leasing Agreements CORIOLANUS LTD: Fitch Cuts Ratings on 2 Classes of Notes to Low-B CRAFT EM: Moody's Junks Ratings on Two Classes of Notes DAPHNE FINANCE: Moody's Cuts Rating on Class F Notes to 'B3' I T A L Y CHRYSLER LLC: Fiat SpA Could Get 20% of Automaker FIAT SPA: Looks to CNH's US$5-Bln Loan Payment for Funding TELECOM ITALIA: Barred from Using Voting Rights in Argentine Unit K A Z A K H S T A N ALLIANCE POLIS: Creditors Must File Claims by May 15 ALTYN OZAT: Creditors Must File Claims by May 15 ATYRAU OIL: Creditors Must File Claims by May 15 BIRLIK OJSC: Creditors Must File Claims by May 15 EK OIL INVEST: Creditors Must File Claims by May 15 SADY PRIDONYA: Creditors Must File Claims by May 15 STROY GAS: Creditors Must File Claims by May 15 T-A-TELECOM-A LLP: Creditors Must File Claims by May 15 VK STROYCOM: Creditors Must File Claims by May 15 K Y R G Y Z S T A N ESSEX GLOBAL LLC: Creditors Must File Claims by April 17 ONENESS CO: Creditors Must File Claims by April 17 L U X E MB O U R G BLACK DIAMOND: S&P Cuts Rating on Class E of 2006-1 Notes to 'B-' N E T H E R L A N D S AMSTEL SCO: Moody's Reviews Ba2-Rated Class E Notes for Downgrade ARRAN CORP: Moody's Cuts Ratings on 6 Classes of Notes to Low-B P O R T U G A L BANIF SA: Moody's Puts 'D+' BFSR on Review for Possible Downgrade R U S S I A BAKALSKIY MINING: Creditors Must File Claims by April 27 BESLANSKIY ELECTROMECHANICAL: Court Names as Insolvency Manager BRK-ZHIL-STROY LLC: Creditors Must File Claims by May 27 ILAN-TRANS LLC: Creditors Must File Claims by May 27 KLYAVLINSKIY OIL: Creditors Must File Claims by April 27 MORDOV-AGRO-STROY OJSC: Creditors Must File Claims by April 27 NATIONAL BANK: Moody's Cuts Bank Financial Strength Rating to 'E' PLESETSKIY WOOD-SAWING: Creditors Must File Claims by April 27 PROM-ATOM-KOMPLEKTATSIYA LLC: Claims Deadline is May 27 PROM-ENERGO-SERVIS LLC: Creditors Must File Claims by April 27 PSKOV-LESO-PRODUKT LLC: Court Names Insolvency Manager SOCHI-GRAD-STROY LLC: Creditors Must File Claims by April 27 SOTSGORBANK: Moody's Assigns 'E+' Bank Financial Strength Rating ULYANOVSK HEAV: Ulyanovskaya Bankruptcy Hearing Set July 17 URAL BANK: Moody's Withdraws 'E' Bank Financial Strength Rating S P A I N BANCAJA-BVA VPO: Moody's Assigns 'Ba3' Rating on Series D Notes FTPYME BANCAJA 3: S&P Cuts Rating on Class D Notes to 'BB-' FTPYME BANCAJA 6: S&P Affirms Rating on Class D Notes at 'CCC-' S W E D E N GENERAL MOTORS: Saab Eyes 20 Possible Buyers GENERAL MOTORS: Speeds Up Preparations for Possible Bankruptcy S W I T Z E R L A N D ALPENMETZGEREI JSC: Creditors Must File Claims by April 16 ARTACHO TECHNICS: Deadline to File Proofs of Claim Set April 16 AVALU JSC: Creditors Have Until April 16 to File Claims BINOMAR HOLDING: Proofs of Claim Filing Deadline is April 16 CHRIFRAG JSC: Creditors' Proofs of Claim Due by April 16 COLLECTOR'S CORNER: April 16 Set as Deadline to File Claims CRYSTAL CREDIT: Moody's Junks Rating on EUR63 Million Notes EMME IMMO: Creditors Must File Proofs of Claim by April 16 SOGATRUST JSC: Deadline to File Proofs of Claim Set April 16 TELL MAKLER: Creditors Have Until April 16 to File Claims TRAFICOMAR JSC: Proof of Claim Filing Deadline is April 16 T U R K E Y ARCELIK AS: Fitch Downgrades Issuer Default Ratings to 'BB-' U K R A I N E AGROBUSINESS-NV OJSC: Court Starts Bankruptcy Procedure DELTA WHOLESALE: Creditors Must File Claims by April 16 DONETSK GRANITE: Creditors Must File Claims by April 16 KIRIT-2007 LLC: Creditors Must File Claims by April 16 KNIAGININ PLUS: Creditors Must File Claims by April 17 PRODUCT-LUX LLC: Creditors Must File Claims by April 16 RADIAL LLC: Court Starts Bankruptcy Supervision Procedure ZLATODAR LLC: Creditors Must File Claims by April 16 U N I T E D K I N G D O M ARROW DISTRIBUTORS: Appoints Joint Administrators from KPMG BBL REALISATIONS: Taps Joint Administrators from Ernst & Young BERTRAM GROUP: Calls in Joint Administrators from Ernst & Young BRADFORD AND BINGLEY: Fitch Affirms Individual Rating at 'F' BTL REALISATIONS: Appoints Joint Administrators from Ernst & Young COCO FINANCE: Moody's Reviews Ba2-Rated Cl. E Notes for Downgrade COLD-FORM LTD: Administrators Put Assets for Sale CORASAIR NO 2: S&P Cuts Rating on A$5.5 Mil. Floating Notes to 'D' E & F JOINERY: Brings in Joint Administrators from Baker Tilly FERONIA PLC: S&P Lowers Rating on Class E Notes to 'BB' ITV PLC: In Talks With Investors Over Rights Issue LAZENBY METAL: Taps Joint Administrators from Deloitte & Touche MANN CONSTRUCTION: In Administration; Vantis Appointed ROBERT DYAS: Management Buyout Nears Completion SHIRES LIMITED: Joint Administrators Put 2 Divisions for Sale SIXTY UK: CVA Deal to Save 250 Jobs URSUS 2: Fitch Cuts Rating on GBP27.2 Mil. Class F Notes to 'BB' VITALITY GROUP: Appoints Joint Administrators from MCR WINDERMERE VIII: S&P Junks Rating on Class E Notes YELL GROUP: Denies Debt Restructuring and Asset Sale Rumors * UK: 117 Profit Warnings Issued in First Quarter 2009, E&Y Says * UK: Manufacturing Business Failures to Increase by 52% in 2009 * More Creditors to Opt for Formal Pay Deals, LC Corporate Says ********* ============= A U S T R I A ============= GIG LLC: Claims Registration Period Ends April 21 ------------------------------------------------- Creditors owed money by LLC Gig (FN 129445k) have until April 21, 2009, to file written proofs of claim to the court-appointed estate administrator: Dr. Ulla Reisch Praterstrasse 62-64 1020 Vienna Austria Tel: 212 55 00 Fax: 212 55 00-5 E-mail: office.wien@ulsr.at Creditors and other interested parties are encouraged to attend the creditors' meeting at 9:30 a.m. on May 5, 2009, for the examination of claims at: Trade Court of Vienna (007) Room 1606 Vienna Austria Headquartered in Vienna, Austria, the Debtor declared bankruptcy on March 4, 2009, (Bankr. Case No. 4 S 32/09x). GOVEDAR LLC: Claims Registration Period Ends April 21 ----------------------------------------------------- Creditors owed money by LLC Govedar (FN 274309x) have until April 21, 2009, to file written proofs of claim to the court- appointed estate administrator: Dr. Romana Weber-Wilfert Esslinggasse 7 1010 Vienna Austria Tel: 90 333 Fax: 90 333-66 E-mail: wien@snwlaw.at Creditors and other interested parties are encouraged to attend the creditors' meeting at 9:00 a.m. on May 5, 2009, for the examination of claims at: Trade Court of Vienna (007) Room 1606 Vienna Austria Headquartered in Vienna, Austria, the Debtor declared bankruptcy on March 2, 2009, (Bankr. Case No. 4 S 30/09b). GOZZOBURG KULTUR: Claims Registration Period Ends April 20 ---------------------------------------------------------- Creditors owed money by LLC Gozzoburg Kultur und Betrieb (FN 296307x) have until April 20, 2009, to file written proofs of claim to the court-appointed estate administrator: Dr. Ulla Reisch Göglstrasse 11b 3500 Krems an der Donau Austria Tel: 02732/484600 Fax: 02732/484610 E-mail: office.krems@ulsr.at Creditors and other interested parties are encouraged to attend the creditors' meeting at 8:30 a.m. on May 6, 2009, for the examination of claims at: Land Court of Krems an der Donau (129) Hall A Second Floor Krems an der Donau Austria Headquartered in Krems an der Donau, Austria, the Debtor declared bankruptcy on March 3, 2009, (Bankr. Case No. 9 S 12/09a). IMMOFINANZ GROUP: Seeks to Avert Insolvency Through Bond Swap ------------------------------------------------------------- Slyvia Westall at Reuters reports that Immofinanz Group plans to swap EUR1.5 billion (US$2 billion) worth of convertible bonds into new convertibles at a lower face value to avert insolvency. In an April 6 release Immofinanz said holders of the outstanding convertible bonds will be entitled to exchange five outstanding bonds maturing in 2014 or in 2017, respectively, each for two new convertible bonds with a considerably shorter maturity (December 22, 2011). The new convertible bond with a total nominal amount of up to EUR600 million has a strike price of EUR2.00 per share and a coupon of 7% p.a. Participating holders will also receive a cash bonus of EUR5,000 for each exchanged convertible bond (with a nominal amount of EUR100,000 each) maturing in 2014 or 2017, respectively. Immofinanz said its subsidiary, Immoeast AG, is issuing a promise of guarantee to the holders of the new convertible bond up to the aggregate amount of EUR600 million plus accrued interest. Assuming full acceptance of the exchange offer, the outstanding nominal amount of the convertible bonds of Immofinanz would be reduced from EUR1.5 billion to EUR600 million, and the company’s equity would be increased by up to EUR825 million. Reuters says investors have until April 23 to decide whether to take up the offer. According to Reuters, Immofinanz bonds due 2014 have for some time priced in a high probability of default. Reuters discloses at 1023 GMT on Monday, April 6, they were quoted at bid 17 and offered at 24 percent of par, down from 33 and 38 earlier in the day. Reuters notes Immofinanz Chief Executive Officer Eduard Zehetner told a news conference there was no specific take-up rate which would make the swap a success, although he said the target is 100 percent. Immofinanz, Reuters recounts, has been fighting a liquidity squeeze by selling assets and other measures since last year. Reuters relates Immoeast said in a statement "Immoeast and its subsidiaries have claims against Immofinanz, the settlement of which is secured by an improvement of the economic situation of Immofinanz." Immoeast, as cited by Reuters, said "The success of the exchange offer ... considerably contributes to the avoidance of an insolvency of Immofinanz and resulting adverse effects on Immoeast." Headquartered in Vienna, Austria, IMMOFINANZ AG -- http://www.immofinanz.at-- is a real estate company that invests in private and commercial properties. Its core activities are the rental and overall management of its portfolio, the identification of sound investments and the diversification of its portfolio both geographically and across the different sectors of the property market. As of April 30, 2008, the Company managed a portfolio of 3.078 properties, covering a usable floor area of 13.4 million square meters. Its properties include apartments, hotels, offices, retail outlets and garages, located in Austria, Eastern and Western Europe and the United States. The Company's property investment business is conducted through three regional companies: IMMOAUSTRIA Immobilien Anlagen GmbH, IMMOWEST Immobilien Anlagen AG and IMMOEAST AG. LIFT LLC: Claims Registration Period Ends April 20 -------------------------------------------------- Creditors owed money by LLC Lift (FN 104395y) have until April 20, 2009, to file written proofs of claim to the court-appointed estate administrator: Dr. Johannes Leon Reichsratsstrasse 5 1010 Vienna Austria Tel: 402 15 54 Fax: 402 15 54-54 E-mail: office@leonlaw.at Creditors and other interested parties are encouraged to attend the creditors' meeting at 10:45 a.m. on May 4, 2009, for the examination of claims at: Trade Court of Vienna (007) Room 1705 Vienna Austria Headquartered in Vienna, Austria, the Debtor declared bankruptcy on March 3, 2009, (Bankr. Case No. 3 S 30/09w). POWER BAU: Claims Registration Period Ends April 20 --------------------------------------------------- Creditors owed money by KG Power Bau (FN 298173s) have until April 20, 2009, to file written proofs of claim to the court- appointed estate administrator: Dr. Anton Aigner Wiener Strasse 19 2700 Wiener Neustadt Austria Tel: 02622/27 9 25 02622/21 7 52 Fax: 02622/21752-18 E-mail: aigner@ycom.at Creditors and other interested parties are encouraged to attend the creditors' meeting at 9:00 a.m. on April 30, 2009, for the examination of claims at: Land Court of Wiener Neustadt (239) Room 15 Wiener Neustadt Austria Headquartered in Bad Fischau, Austria, the Debtor declared bankruptcy on March 4, 2009, (Bankr. Case No. 10 S 22/09b). =========== F R A N C E =========== FCI INTERNATIONAL: Moody's Cuts Corporate Family Rating to 'B2' --------------------------------------------------------------- Moody's Investors Service downgraded the corporate family rating of FCI International S.A.S to B2 from B1. The probability of default rating was downgraded to B3 from B2, and the bank facility ratings were downgraded to B2 from B1. The ratings outlook remains negative. The downgrades reflect the ongoing weak outlook in FCI's end- markets, which continues to impact the operating performance of each of FCI's divisions - and the potential impact on the company's liquidity profile. The severe global downturn in the automotive industry and, to a lesser extent, reduced consumer demand in the electronics division are materially reducing group Ebitda. Although forward visibility in FCI's end-user markets remains very limited, in Moody's view Ebitda in 2009 will be materially below that of 2008. The outcome, together with the ability of FCI to generate free cash flow in 2009, is highly dependent on the progress that FCI continues to make in its cost reduction efforts to offset reduced revenue; and this may depend materially on the country of location of those facilities where restructuring is necessary. All FCI's external financial debt is bank loans. Some limited amounts are due for repayment in 2009. Although the major Tranche B repayments of about EUR480 million -- exact amounts subject to EUR/US$ fluctuation -- are not due until 2013, the company anticipates repayment of about EUR36 million in each of 2010, 2011 and 2012. FCI's available liquidity is split between cash and its undrawn bank revolver. A situation of ongoing negative free cash flow would increase liquidity pressure. The bank facilities also have covenants that are typical for LBO transactions, and Moody's believes that these could come under pressure in 2009 due to the reduced Ebitda. The negative outlook reflects the ongoing uncertainty over FCI's 2009 Ebitda generation, as well as liquidity pressures. The outlook could be stabilized if FCI demonstrated an ability to sustain free cash flow generation -- which would require it to recover from its very weak start to 2009, and successfully maintain its cost reduction efforts - or resolved its liquidity pressures. The last rating credit rating announcement for FCI was on 12 March 2009, when the CFR was downgraded to B1. FCI, based in Versailles, France, is the world's fourth largest connector manufacturer with 2007 revenue of EUR1.33 billion. In 2005, Bain Capital acquired FCI in an LBO for a total consideration of EUR934 million. ============= G E R M A N Y ============= AABACH GRAPHIC: Claims Registration Period Ends May 18 ------------------------------------------------------ Creditors of Aabach Graphic Systems Verwaltungs GmbH have until May 18, 2009, to register their claims with court-appointed insolvency manager. Creditors and other interested parties are encouraged to attend the meeting at 10:30 a.m. on June 8, 2009, at which time the insolvency manager will present his first report. The meeting of creditors will be held at: The District Court Muenster Meeting Hall 101 B Gerichtsstr. 2-6 48149 Muenster 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: Holger Zbick Marktplatz 2/4 48712 Gescher Germany Tel: 02542/9178-0 Fax: +492542917828 The court opened bankruptcy proceedings against the company on April 1, 2009. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be reached at: Aabach Graphic Systems Verwaltungs GmbH Attn: Rudolf Reese, Manager Daimlerstrasse 6 48683 Ahaus Germany COIFFEUR CHARMANT: Claims Registration Period Ends May 20 --------------------------------------------------------- Creditors of Coiffeur Charmant GmbH have until May 20, 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 June 10, 2009, at which time the insolvency manager will present his first report. The meeting of creditors will be held at: The District Court of Stendal Hall 112 Albrecht der Bar Scharnhorststrasse 40 39576 Stendal 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: Stephan Poppe Hegel St. 32 39104 Magdeburg Germany Tel: 0391/40492-50 Fax: 0391/40492-55 The court opened bankruptcy proceedings against the company on April 1, 2009. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be reached at: Coiffeur Charmant GmbH Attn: Petra Hoppe, Manager Oebisfelder St. 4 38486 Kloetze Germany COMMERZBANK AG: May Sell Eurohypo Unit or Eastern European Ops -------------------------------------------------------------- Commerzbank AG may sell its Eurohypo commercial property unit or eastern European operations to win European Union approval for German state aid, Bloomberg News reports citing a person familiar with the matter. The report relates Commerzbank said in January it would get EUR10 billion (US$13.4 billion) in a second round of aid, giving the state 25 percent plus one share. The disposals are among options under discussion, and no decision has been made, the person, who declined to be identified because the talks are private, told Bloomberg News. Eschborn, Germany-based Eurohypo, a public finance and commercial- property lender bought by Commerzbank for about EUR4.5 billion in 2006, had a pretax loss of about EUR1.4 billion last year, Bloomberg News says. As reported in the Troubled Company Reporter-Europe on April 6, 2009, William Launder at Dow Jones Newswires said shareholders will be asked at the company's annual general meeting on May 15 to approve an agreement Commerzbank reached with the German financial markets stabilization fund, or SoFFin, in January. Under the agreement, Dow Jones said the German government will take a 25% plus one share stake in Commerzbank and will provide a silent participation of EUR8.2 billion. In an earlier report, Bloomberg News said the German bank, which has tapped the German government for EUR18.2 billion (US$24.2 billion) in capital, will ask shareholders for approval to issue about EUR1.77 billion of new shares to allow the government to take the holding. Commerzbank will also ask shareholders to give it the option to issue about 258 million new shares, Bloomberg News added. Germany-based Commerzbank AG (FRA:CBK) -- https://www.commerzbank.com/ -- is an integrated bank and financial institution. The Company's operates in five segments: Private Customers, Mittelstandsbank, Central and Eastern Europe, Corporates & Markets and Commercial Real Estate. Commerzbank AG serves a total of approximately 14 million private and corporate customers. Commerzbank is a service provider for private and business customers, as well as small and mid-sized companies, while also serving large and multinational corporate customers. In March 2008, the Company completed the acquisition of a majority stake of 60% plus one share in the private Ukrainian bank, Bank Forum. In May 2008, The Royal Bank of Scotland Group plc and Commerzbank AG sold their stakes in Hellenic Telecommunications Organization SA (OTE). On January 12, 2009, Commerzbank AG completed the acquisition of Dresdner Bank. DGTH PRODUKTIONS: Claims Registration Period Ends April 30 ---------------------------------------------------------- Creditors of DGTH Produktions GmbH have until April 30, 2009, to register their claims with court-appointed insolvency manager. Creditors and other interested parties are encouraged to attend the meeting at 9:25 a.m. on May 19, 2009, at which time the insolvency manager will present his first report. The meeting of creditors will be held at: The District Court of Wuppertal Meeting Room A234 Second Floor Isle 2 42103 Wuppertal 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. Joerg Bornheimer Laurentiusstrasse 21-23 42103 Wuppertal Germany Tel: 0202/4086150 Fax: 0202/4086159 The court opened bankruptcy proceedings against the company on April 1, 2009. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be reached at: DGTH Produktions GmbH Dr. Friedrich Joachim Falcke, Manager Gruben St. 6-8 42579 Heiligenhaus Germany DPM ELECTRONIC: Claims Registration Period Ends May 8 ----------------------------------------------------- Creditors of DPM Electronic Service GmbH have until May 8, 2009, to register their claims with court-appointed insolvency manager. Creditors and other interested parties are encouraged to attend the meeting at 11:00 a.m. on May 25, 2009, at which time the insolvency manager will present his first report. The meeting of creditors will be held at: The District Court of Essen Meeting Hall 293 Second Floor Zweigertstr. 52 45130 Essen 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: Henning Bungart Christoph St. 11 45130 Essen Germany The court opened bankruptcy proceedings against the company on April 1, 2009. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be reached at: DPM Electronic Service GmbH Am Lichtbogen 41 45141 Essen Germany Attn: Peter Buttler, Manager Rosen St. 14 45899 Gelsenkirchen Germany EXXE GMBH: Claims Registration Period Ends May 8 ------------------------------------------------ Creditors of EXXE GmbH have until May 8, 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 June 29, 2009, at which time the insolvency manager will present his first report. The meeting of creditors will be held at: The District Court of Luebeck Hall 256 Am Burgfeld 7 23568 Luebeck 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. Peer Moeller Untere Quer St. 1 23730 Neustadt/H. Germany The court opened bankruptcy proceedings against the company on April 1, 1009. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be reached at: EXXE GmbH Attn: Herrn Jens-Uwe Gunnesson, Manager Muehlenbruecke 7 23552 Luebeck Germany INFINEON TECH: UBS Recommends "Buy" on Possible Gov't Funding ------------------------------------------------------------- UBS AG raised Infineon Technologies AG to "buy" from "neutral" citing the likelihood of government-backed financing, Bloomberg News reports. "We believe government-backed debt financing is the most likely path," the news agency quoted analyst Nicolas Gaudois as saying in a note, adding that Infineon's role as supplier -- sometimes the sole supplier -- of chips for the country's automotive industry is an incentive for government support. The report relates Chancellor Angela Merkel's government has made EUR100 billion available in credit and loan guarantees to German companies. Infineon, which has EUR200 million of bonds maturing in June, also has shareholders' permission to raise as much as EUR450 million of capital by selling new shares, Bloomberg News says. As reported in the Troubled Company Reporter-Europe on Dec. 4, 2008, Infineon's group net loss for the 2008 fiscal year increased to EUR3,122 million from EUR368 million in the 2007 fiscal year. Net loss from continuing operations for the full 2008 fiscal year was EUR135 million compared to EUR37 million in the 2007 fiscal year. The company recorded a EUR 2,987 million net loss from discontinued operations, net of tax, for the 2008 fiscal year. This loss, the company said, included Infineon's share in Qimonda's net loss, as well as EUR1,303 million from the write- down of Qimonda to its net realizable value less costs to sell. Infineon's revenues in the full 2008 fiscal year increased to EUR4,321 million from EUR4,074 million in the prior year. About Infineon Technologies AG Headquartered in Neubiberg, Germany, Infineon Technologies AG (FRA:IFX) -- http://www.infineon.com/-- is a semiconductor company. It designs, develops, manufactures and markets a range of semiconductors and complete systems solutions used in a variety of microelectronic applications, including computer systems, telecommunications systems, consumer goods, automotive products, industrial automation and control systems, and chip card applications. Its products include standard commodity components, full-custom devices, semi-custom devices and application-specific components for memory, analog, digital and mixed-signal applications. The Company has operations, investments and customers located in Europe, Asia and North America. Its core business is conducted through its Automotive, Industrial & Multimarket segment, and its Communication Solutions segment. Its memory products business is conducted through its majority owned subsidiary, Qimonda AG. In April 2008, LSI Corporation purchased the assets of the hard disk drive semiconductor business of Infineon. PREMIERE AG: New Shares Offered 50% Lower Than Last Week's Close ---------------------------------------------------------------- Premiere AG said the subscription price for new shares issued within its capital increase is set at EUR1.12 per share, reflecting a discount of 50% of the closing price at April 3 at Frankfurt stock exchange, Archibald Preuschat at Dow Jones Newswires reports. The report says Premiere needs the capital increase to fulfill its obligations to various banks as a condition of its debt restructuring. The subscription period starts at April 8 and ends April 21, subject to regulatory approvals, while the trading period for the preemptive rights is set from April 8 until April 17, according to the report. The report relates the first trading day for the new shares is expected April 24. Based in Unterfoehring, Germany, Premiere AG (FRA:PRE) -- http://info.premiere.de/-- operates a subscription television network in Germany and Austria. Its network is available via satellite or cable, but the company also offers its programming on Internet protocol television (IPTV). Premiere's service offers channels to cater for all audiences, including themed channels dedicated to broadcasting feature films, live sporting events, foreign language content, children's programming and interactive betting. Four varieties of subscription packages are available for customers, as well as the Komplett package for those who wish to subscribe to all channels. Premiere's high definition television (HDTV) package shows selected content derived from Premiere's other channels and the Discovery Channel in HDTV format. One of Premiere's core competencies is pay-per-view television. The company also markets advertising space and promotional opportunities. PROCREDIT HOLDING: Fitch Downgrades Individual Rating to 'D' ------------------------------------------------------------ Fitch Ratings has affirmed ProCredit Holding AG's Long-term Issuer Default 'BBB-' (BBB minus) with a Stable Outlook, Short-term IDR 'F3' and Support '2' on continued strong support from its owners. Its Individual Rating was downgraded to 'D' from 'C/D' on weakening standalone strength in a deteriorating operating environment in several of the group's local markets. The IDRs and Support Rating reflect Fitch's view of the strong potential support available from its key shareholders, given the group's important developmental role in providing financing and other banking services to micro enterprises and SMEs in developing markets. The Individual Rating reflects PCH's niche business, reasonable profitability, good risk management and strong, albeit worsening, asset quality (loans past due 30 days: 1.7% at end-2008 compared to 1.4% at end-2007). It also considers PCH's size and modest capitalizations, particularly given the deteriorating operating environment in several of its local markets (PCH reported tier 1 capital: ratio: 9.8%; total capital ratio: 13.1% at end-2008). Fitch expects PCH's asset quality to worsen in coming quarters, potentially adding further pressure on profitability and, potentially, on capitalizations if significant credit losses were to materialize. However, the agency also notes the relative resilience of the group, given the high granularity of its loan portfolio, its focus on micro enterprise and SME finance, its use of a cash-flow based credit analysis (as opposed to asset-based) and its conservative loan loss provisioning policy. Fitch has conducted a number of stress tests to deteriorating asset quality trends and its consequences on its profitability and capital. The agency will issue a separate comment expanding on the various scenarios. Frankfurt-based PCH was set up as an equity investment company in 1998 to invest in the global network of ProCredit banks. These banks were established by private and public investors to provide financing for micro and SME customers. As of end-2008, the group had total assets of EUR4.8bn, and consisted of 22 banks in central and eastern Europe (11), Latin America (seven) and Africa (four). ============= H U N G A R Y ============= MAGYAR TAKAREKSZOVETKEZETI: S&P Cuts Counterparty Rating to 'BB' ---------------------------------------------------------------- Standard & Poor's Ratings Services said that it had lowered its long-term counterparty credit rating on Hungary-based Magyar Takarekszovetkezeti Bank Rt. (Bank of Hungarian Savings Cooperatives Co. Ltd.) to 'BB' from 'BB+'. The 'B' short-term counterparty credit rating was affirmed. The outlook is negative. "The downgrade reflects our concerns about accelerating economic contraction and industry risk in the Republic of Hungary," said Standard & Poor's credit analyst Harm Semder. This rating action follows S&P's recent downgrade of Hungary to BBB-/Negative/A-3 from BBB/Negative/A-3. S&P's current ratings take into account the possibility of a 6% decline in the Hungarian economy in 2009, which increases the likelihood of severe repercussions on Takarekbank's financial profile, and on that of the Hungarian savings cooperatives sector over the next two years. Takarekbank continues to benefit from a one-notch uplift from the expected ownership support from the SCs. In S&P's view, rapidly worsening economic conditions in Hungary make it very likely that Takarekbank's and the SCs' asset quality and earnings metrics will deteriorate considerably. Moreover, S&P is uneasy about elevated risks from Takarekbank's nearly 55% share in foreign currency lending to unhedged corporates and consumers that are untested in prolonged difficult conditions. S&P's current ratings on Takarekbank reflect the possibility that Takarekbank's and the SCs' performance in 2009 will be much more depressed. S&P's concerns are mitigated by Takarekbank's role as the clearing bank and business coordinator of the SC network. The ratings on Takarekbank do not include any uplift for extraordinary government support. But S&P considers the bank to be systemically important, reflecting its vital role for the SC sector, which has a strong retail deposits position. However, in line with S&P's ratings approach in supportive countries, S&P does not factor the probability of government support into S&P's ratings on private sector banks as long as such support is not tangible. Moreover, S&P continues to view Takarekbank's 37% ownership by DZ BANK AG Deutsche Zentral-Genossenschaftsbank (A+/Stable/A-1) to be beneficial for its enterprise risk management, but S&P give no additional notches of support for it. This is because S&P continue to consider the bank as nonstrategic for DZ BANK. The negative outlook reflects S&P's concerns that Takarekbank's financial profile could weaken more than currently anticipated if increasing economic contraction and industry risk in Hungary were to be deeper and longer than S&P currently expect. Similarly, S&P sees intense pressures on the Hungarian SC sector, which could reduce their financial ability to support Takarekbank. "We would consider a downgrade, in particular, if Takarekbank's or the SC sector's asset quality and performance were to worsen beyond S&P's already subdued expectations, or if sound liquidity positions deteriorate," said Mr. Semder. Moreover, the ratings would most likely be lowered if Takarekbank's central role within the sector were to weaken, although S&P does not expect this to happen. MKB BANK: S&P Downgrades Public-Information Ratings to 'BBpi' ------------------------------------------------------------- Standard & Poor's Ratings Services said that it had lowered its public-information ('pi'; unsolicited) ratings on Hungary-based MKB Bank ZRT (MKB) to 'BBpi' from 'BBBpi'. At the same time, S&P lowered its 'pi' ratings on Hungary-based Central- European International Bank Ltd., and K&H Bank to 'BBB-pi' from 'BBBpi'. The 'pi' ratings on all three banks continue to be based on S&P's expectation of support from their western European owners, because S&P continues to consider them as strategically important group subsidiaries. K&H, CIB, and MKB are owned by Belgium based KBC Bank N.V. (100%, A/Stable/A-1), Italy based Intesa Sanpaolo SpA (100%, AA-/Negative/A-1+), and Germany based Bayerische Landesbank (90%, A/Negative/A-1) respectively. 'Pi' ratings are generally not modified with plus or minus designations. In very rare occasions, however, S&P does apply modifiers. S&P has done this now for CIB and K&H, with both having minus designations. This is because S&P wanted to clarify that the 'pi' ratings on these banks are not higher than the foreign currency rating on the Republic of Hungary (BBB-/Negative/ A-3). "Our downgrades of K&H, CIB, and MKB follow our recent downgrade of Hungary on March 30, 2009," said Standard & Poor's credit analyst Harm Semder. Moreover, the 'pi' rating actions take into account S&P's concerns about the likelihood of severe repercussions on MKB's, K&H's, and CIB's financial profile in 2009 and 2010 as a result of accelerating economic contraction and industry risk in Hungary, and additional pressures from other parts of Central and Eastern Europe. In S&P's view, rapidly worsening economic conditions in Hungary and most CEE markets make it very likely that MKB's, K&H's, and CIB's asset quality and earnings metrics will deteriorate considerably after several years of strong asset and profit growth. The banks' credit risk is heightened in S&P's opinion by rapid unseasoned growth of loans, and a large amount of foreign currency lending to unhedged consumers and corporates that is untested in prolonged difficult conditions. S&P's current ratings take into account the possibility of a 6% decline in the Hungarian economy in 2009. Consequently, S&P believes that the main cause of the pressure will be accelerated credit costs from a material rise in nonperforming loans. The 'pi' ratings on MKB, K&H, and CIB do not include any uplift for extraordinary government support. But S&P considers these banks to be systemically important in Hungary, reflecting their size and scale of retail operations, in particular retail deposits. However, in line with S&P's rating approach in supportive countries like Hungary, S&P does not factor the probability of government support into its ratings on private sector banks as long as such support is not tangible. ============= I R E L A N D ============= AER LINGUS: CEO Dermot Mannion Resigns -------------------------------------- Bloomberg News reports Aer Lingus Group Plc Chief Executive Officer Dermot Mannion has resigned effective April 6. "My decision to step down will allow a new CEO to bring fresh thinking and new ideas to the business," Mr. Mannion said in a statement obtained by the news agency. Chairman Colm Barrington will run the carrier until a permanent CEO is appointed, the report says. Separately, Sarah Turner at MarketWatch reports Aer Lingus said it carried 835,000 passengers in March, down 7% compared to a year ago. The airline saw a 5.1% reduction on short haul and a 20.9% reduction on long haul, the report says. The report relates reduced capacity in the month resulted in improved load factors, with an overall load factor of 75.6%, up 0.3 percentage points compared to a year ago. As reported in the Troubled Company Reporter-Europe on Mar. 16, 2009, Aer Lingus incurred a EUR107.8 million (US$136.5 million) net loss in 2008 compared with net income of EUR105.3 million in 2007 after a EUR141 million one-time expense to cover employee severance packages and the cost of defeating Ryanair Holdings Plc's takeover offer. The company's earnings was also hurt by deteriorating consumer sentiment, currency fluctuations, restructuring costs and higher fuel prices. Bloomberg News recalls Ryanair dropped its takeover bid in January after the Irish government rejected the transaction as undervaluing Aer Lingus and posing a threat to competition. Ryanair holds 29.8 percent in Aer Lingus, Bloomberg News says. Revenue in 2008 rose 5.6 percent to EUR1.36 billion. The company aims to save about EUR52 million this year from a cost-cutting drive including freezing salaries. The airline warned it may not meet its previous forecast of a pre- tax profit in 2009. The Wall Street Journal reported that to maintain volumes, Aer Lingus predicted 2009 revenue will fall, average fares will drop by at least 10% and cargo revenue is expected to decline as much as 30% from a year earlier. Chief Financial Officer Sean Coyle told the Journal in an interview that the trans-Atlantic market is "the weakest part of our business" and was under review, but said he wasn't yet sure if the airline would cut flights or reduce fares. Aer Lingus's strategy now was to roll out short-haul bases in the U.K. and Continental Europe, Mr. Coyle said as cited by the Journal. About Aer Lingus Group Plc Dublin, Ireland-based Aer Lingus Group Plc (ISE:AERL) -- http://www.aerlingus.com/-- and its subsidiaries operate as a low fare airline primarily providing passenger and cargo transportation services from Ireland to the United Kingdom and Europe (short haul) and also to the United states (long haul). The Company also provides cargo transportation services on its passenger aircraft, primarily on its long-haul routes, as well as a range of ancillary services to its passengers. CHARTBUSTERS: Gets Court Permission to Revoke Leasing Agreements ---------------------------------------------------------------- The High court has granted Chartbusters permission to seek orders revoking lease agreements for premises the company no longer needs to allow the examiner to finalize a scheme of arrangement, the Irish Times reports. According to the report, if the scheme is approved by the company's creditors and the High Court, Chartbusters will be restructured and 23 of its 36 home entertainment stores may be saved. The report discloses the premises Chartbusters leased include premises at Golden Island Shopping Centre in Athlone; Carrigaline, Co Cork; Christchurch, Dublin; Crescent Shopping Centre, Limerick; the Maple Centre, Dublin; Anne Street, Newbridge, Co Kildare; O'Hagan House, Ranelagh, Dublin; and Terenure Place, Dublin. The stores in Athlone and Carrigaline were closing, while the stores in Newbridge, the Maple Centre and Terenure were now closed, according to the report. The premises in Christchurch, Limerick and Ranelagh were never occupied, the report notes. The report relates on Monday, Mr. Justice Garrett Sheehan granted the company permission to serve short service to all relevant parties, including the court-appointed examiner, of the proceedings, the report recounts. In an affidavit to the court, Richard Murphy, a director and shareholder of Chartbusters, as cited by the report, said the examiner, Neil Hughes, had indicated to the company that before he could finalize a scheme of arrangement, it should apply to the High Court to have several of the company’s leases repudiated. The report states Mr. Murphy said he believed the examiner intended to include any outstanding liabilities of the landlords of the premises as unsecured creditors in the proposed scheme of arrangement. On Jan. 29, 2009, the Troubled Company Reporter-Europe, citing the Irish Times, reported Mr. Justice Peter Kelly granted court protection to Chartbusters. Mr. Justice Kelly appointed Mr. Hughes as examiner to the company, the Irish Times disclosed. The judge, as cited by the Irish Times, said the company was insolvent and would have a shortfall between assets and liabilities of some EUR246,000 as a going concern and of some EUR4.8 million if wound up. The judge, the Irish Times noted, agreed to appoint an examiner after reports from the independent account and interim examiner expressed the view the company had a reasonable prospect of survival if certain conditions, including the closure of 17 of its 37 stores, are met. CORIOLANUS LTD: Fitch Cuts Ratings on 2 Classes of Notes to Low-B ----------------------------------------------------------------- Fitch Ratings has downgraded Coriolanus Limited Series 1's notes and assigned Negative Outlooks: -- Class A notes (ISIN XS0144319182) downgraded to 'BB' from 'AAA'; assigned a Negative Outlook -- Class B notes (ISIN XS0144318705) downgraded to 'B' from 'AA'; assigned a Negative Outlook The downgrades reflect the high concentration of the collateral portfolio in the banking and finance sector, explicitly in the form of subordinated capital instruments which bear a significantly increased credit risk. Additionally, in the current regulatory environment, interest deferrals and extension of the first call date have become a real possibility which places significant pressure on the class A and B notes. At closing in July 2002, Coriolanus, an SPV domiciled in Ireland, issued notes secured on a debt portfolio purchased from Deutsche Bank AG (DB, rated 'AA-'((AA minus))/'F1+'/Rating Watch Negative). A swap agreement between Coriolanus and DB pays the collateral interest to DB in return for the coupon on the notes. The portfolio currently consists of 27 debt obligations from 23 obligors, of which 80% belong to the banking and finance sector and 20% are corporate debt securities. While the non-finance related obligations are made up of senior unsecured debt, the banking and finance obligations consist of predominately subordinated debt, of which approximately one third is made up of Genusscheine and two-thirds is perpetual bank debt (Tier 1). Both are hybrid capital instruments, which allow for deferral of coupon payments as part of the contractual features. Currently, one obligation, representing 1.4% of the portfolio, actually defers interest. If after a period of two years, the obligation remains in arrears, the security is required to be liquidated. Fitch believes interest deferrals for a further six obligors are a real possibility as the institutions are exhibiting weak fundamentals and heavy losses. Several banks have also received government capital. While this helps to mitigate a potential insolvency of the institution, it may also raise the risk of coupon deferrals on hybrid capital instruments as the government aims to protect taxpayer funds. Additionally, the hybrid capital instruments allow the issuing institution to continue servicing the respective instruments past the first call date. This extension would materially affect the ability of the SPV to redeem the notes because the class A notes rely on the underlying securities to be called to be paid down until 2012, while the class B and the unrated Class C notes have one bullet payment date in 2012 (at this time the swap agreement with DB will also terminate). If this expected maturity date is missed due to collateral securities not being redeemed as anticipated, class A will need to be redeemed by final maturity in 2014. Class B has a perpetual final maturity. The credit enhancement for the class A and B notes has increased to 31.7% and 13.7% respectively from initial levels of 20.5% and 9.0%. However, the credit enhancement calculation is based on the nominal value of the collateral assets and does not reflect the market value of the collateral. The market value of the banking and finance collateral has dropped sharply in the past year. Per the 17 March 2009 trustee report, the reported fair market value ratio of the collateral pool was 43.8%, which falls well short of the required level of 85%. The failure of the fair market value ratio allows the senior noteholders to vote for early redemption. However, at this point the early redemption of the notes would imply a total loss for class B and the unrated class C and a significant loss for senior noteholders. In addition to the market value losses, a swap termination payment would also be due from the issuer before redeeming the class A notes. In the event of near-term liquidation, the swap breakage cost would further diminish recovery prospects for the senior notes. The interest coverage ratio of 1335.8% comfortably exceeds its trigger value of 115%. However, the notes do not benefit from this excess spread as the transaction would only divert interest to redeem principal if the overcollateralization ratio (OC ratio) falls below 144%. As the OC ratio is based on the nominal value of the collateral assets rather than the market value even for lowly-rated collateral assets, with the exception of assets in arrears, the OC ratio is currently passing well above the required level. Fitch believes the rated notes no longer merit investment grade status as the risk of interest deferrals and maturity extensions in the portfolio has significantly increased. CRAFT EM: Moody's Junks Ratings on Two Classes of Notes ------------------------------------------------------- Moody's Investors Service has downgraded its ratings of four classes of notes issued by CRAFT EM CLO 2006-1 Limited. The transaction is a replenishable synthetic Balance Sheet CDO referencing a pool of bank originated corporate loans. While the portfolio has reduced in size from US$1 billion at closing to c US$958.9 million as at 16 Mar 2009, losses on defaulted assets stand at US$32,045,000 effectively depleting more than 50% of the US$60,000,000 subordination available to the junior classes of the rated Notes. The rating actions reflect (a) the substantial deterioration in the credit quality of the transaction's reference portfolio, as indicated by the increase in the average rating factor from 675 (at closing in April 2006) to 1286 (16 Mar 2009) and (b) the revision of certain key assumptions that the agency uses to rate and monitor corporate CDOs. These revised assumptions incorporate Moody's expectation that European and global corporate default rates are likely to greatly exceed their historical long-term averages and reflect the heightened interdependence of credit markets in the current global economic contraction. Specifically, the changes include: (1) a 30% increase in the assumed likelihood of default for corporate credits in CDOs (2) an increase in the degree to which ratings are adjusted according to other credit indicators such as rating Reviews and Outlooks and (3) an increase in the default correlation applied to corporate portfolios as generated through a combination of higher default rates and increased asset correlations. These revised assumptions are described in greater detail in the press release published on January 15, 2009. Moody's notes that the global corporate loan sector currently has a negative outlook and has shown signs of increasing weakness in terms of credit performance. The sector is further stressed by the anticipated limited refinancing opportunities for EMEA corporate issuers over the next six to twelve months. In addition, for the majority of the underlying referenced assets, the equivalent Moody's ratings used in Moody's analysis are obtained through a mapping process between the originator's internal rating scale and Moody's public rating scale. To compensate for the absence of credit indicators such as ratings reviews and outlooks in mapped ratings, a half notch stress was applied to the mapping scale. Because this mapping was performed prior to April 1, 2007, an additional stress was applied to capture potential deviations from the established mapping. Moody's initially analyzed and continues to monitor this transaction using primarily the methodology and its supplements for corporate synthetic CDOs as described in Moody's Special Reports and press releases below: -- Moody's Approach To Rating Corporate Collateralized Synthetic Obligations (March 2009) -- Framework for De-Linking Hedge Counterparty Risks from Global Structured Finance Cashflow Transactions (May 2007) -- Modeling Recovery Rates in European CDOs The rating actions are: CRAFT EM CLO 2006-1,Ltd. -- US$12,500,000 Class E-1 Credit Linked Notes Due 2012, Downgraded to B2; previously on 28 August 2006 Assigned Baa1 -- US$12,500,000 Class E-2 Credit Linked Notes Due 2012, Downgraded to B2; previously on 9 March 2007 Assigned Baa1 -- US$17,500,000 Class F-1 Credit Linked Notes Due 2012, Downgraded to Caa3; previously on 28 August 2006 Assigned Ba2 -- US$17,500,000 Class F-2 Credit Linked Notes Due 2012, Downgraded to Caa3; previously on 9 March 2007 Assigned Ba2 DAPHNE FINANCE: Moody's Cuts Rating on Class F Notes to 'B3' ------------------------------------------------------------ Moody's Investors Service has downgraded its ratings of six classes of notes issued by Daphne Finance 4 plc. The transaction is a replenishable synthetic Balance Sheet CDO referencing a pool of bank originated corporate loans. The rating actions reflect the deterioration in the credit quality of the transaction's reference portfolio, as indicated by the increase in the portfolio average rating factor by 48% since closing, and the revision of certain key assumptions that the agency uses to rate and monitor corporate CDOs. These revised assumptions incorporate Moody's expectation that European and global corporate default rates are likely to greatly exceed their historical long-term averages and reflect the heightened interdependence of credit markets in the current global economic contraction. Specifically, the changes include: (1) a 30% increase in the assumed likelihood of default for corporate credits in CDOs (2) an increase in the degree to which ratings are adjusted according to other credit indicators such as rating Reviews and Outlooks and (3) an increase in the default correlation applied to corporate portfolios as generated through a combination of higher default rates and increased asset correlations. These revised assumptions are described in greater detail in the press release published on January 15, 2009. Moody's notes that the global corporate loan sector currently has a negative outlook and has shown signs of increasing weakness in terms of credit performance. The sector is further stressed by the anticipated limited refinancing opportunities for EMEA corporate issuers over the next six to twelve months. In addition, for the majority of the underlying referenced assets, the equivalent Moody's ratings used in Moody's analysis are obtained through a mapping process between the originator's internal rating scale and Moody's public rating scale. To compensate for the absence of credit indicators such as ratings reviews and outlooks in mapped ratings, a half notch stress was applied to the mapping scale. Because the mapping was performed prior to April 1, 2007, an additional stress was applied to capture potential deviations from the established mapping. Moody's initially analyzed and continues to monitor this transaction using primarily the methodology and its supplements for corporate synthetic CDOs as described in Moody's Special Reports and press releases below: -- Moody's Approach To Rating Corporate Collateralized Synthetic Obligations (March 2009) -- Framework for De-Linking Hedge Counterparty Risks from Global Structured Finance Cashflow Transactions (May 2007) -- Modeling Recovery Rates in European CDOs The rating actions are: Daphne Finance 4 plc -- EUR196,000,000 Class A Credit-Linked Floating Rate Notes due 2014, Downgraded to Aa3; previously on 27 December 2006 Assigned Aaa -- EUR32,000,000 Class B Credit-Linked Floating Rate Notes due 2014, Downgraded to Baa1; previously on 27 December 2006 Assigned Aa2 -- EUR28,000,000 Class C Credit-Linked Floating Rate Notes due 2014, Downgraded to Baa3; previously on 27 December 2006 Assigned A1 -- EUR36,000,000 Class D Credit-Linked Floating Rate Notes due 2014, Downgraded to Ba1; previously on 27 December 2006 Assigned A3 -- EUR32,000,000 Class E Credit-Linked Floating Rate Notes due 2014, Downgraded to B1; previously on 27 December 2006 Assigned Baa3 -- EUR24,000,000 Class F Credit-Linked Floating Rate Notes due 2014, Downgraded to B3; previously on 27 December 2006 Assigned Ba2 ========= I T A L Y ========= CHRYSLER LLC: Fiat SpA Could Get 20% of Automaker ------------------------------------------------- The Detroit Free Press reports that under the latest scenario proposed by the U.S. government, Fiat SpA will have the largest block of Chrysler LLC, at 20%. The remaining 80% will be allocated among a variety of secured creditors that include at least five banks and U.S. Taxpayers, the Free Press says. According to Eric Sylvers at The New York Times, U.S. President Barack Obama is requiring that the two companies complete their plan for partnership before Chrysler can receive another multibillion-dollar loan to keep it out of bankruptcy. Chrysler is to receive US$6 billion more in U.S. loans after getting a US$4 billion loan in January, Mike Ramsey at Bloomberg News says. Jennifer Clark at Dow Jones relates Fiat's strength in fuel efficiency is its biggest bargaining chip as it negotiates a stake in Chrysler. As reported in the Troubled Company Reporter-Europe on April 1, 2009, Marco Bertacche and Francesca Cinelli at Bloomberg News said according to a government official with knowledge of the plans, under a new deal, Fiat would take less than 35 percent equity in Chrysler initially. Earlier reports said Fiat is likely to take a 35% stake in Chrysler by the middle of the year. According to Bloomberg News's Mike Ramsey, a person familiar with the alliance plans said Fiat would take an initial holding of 20 percent in Chrysler, and ultimately would be limited to a 49 percent stake. Chrysler has been trying to keep itself afloat. As reported by the Troubled Company Reporter on March 20, 2009, its Chief Financial Officer Ron Kolka, has said even if Chrysler gets additional government loans, it could face another cash shortage in July when revenue dries up as the company shuts down its factories for two weeks to change from one model year to the next. General Motors Corp. and Chrysler admitted in their viability plans submitted to the U.S. Treasury on February 17 that they considered bankruptcy scenarios, but ruled out the idea, citing that a Chapter 11 filing would result to plummeting sales, more loans required from the U.S. government, and the collapse of dealers and suppliers. Fiat Chief Executive Officer Sergio Marchionne meanwhile is "confident" that Chrysler and Fiat will succeed in talks with the U.S. administration on further aid, according to Bloomberg News. "Impossible Goal" The Troubled Company Reporter on Apr. 2, 2009, said according to a Bloomberg News report, Chrysler may face an "impossible goal" in completing an alliance with Fiat and meeting an Obama administration deadline to erase debt and win more union concessions by April 30. Bloomberg's Mike Ramsey reported that Chrysler got its blueprint for the month of April from President Obama's task force, which said that US$6 billion in new aid hinges on "extinguishing the vast majority" of outstanding secured debt and new givebacks from the United Auto Workers. Bloomberg said meeting those requirements would require help from lenders JPMorgan Chase & Co., Citigroup Inc., Goldman Sachs Group Inc. and Morgan Stanley, which haven't negotiated in the three months since Chrysler got its U.S. loans and have little incentive to do so because they would be paid off first in bankruptcy. Even President Obama's autos panel suggested Chrysler might fare better by reorganizing in court, Bloomberg said. According to Bloomberg, a Chrysler-Fiat combination would be the world's sixth largest by vehicle sales, behind Ford Motor Co. The companies said they have a framework for the alliance they agreed to in principle in January, while adding that "substantial hurdles" remain. The report stated that according to President Obama's task force, "Given the magnitude of the concessions needed, the most effective way for Chrysler to emerge from this restructuring with a fresh start may be by using an expedited bankruptcy process as a tool to extinguish liabilities". About Fiat SpA Based in Torino, Italy, Fiat S.p.A. (OTC:FIATY) -- http://www.fiatgroup.com/-- is principally engaged in the manufacture and distribution of automobiles, agricultural and construction equipment, and commercial vehicles, in addition to components for those products. The Company also provides financial services, primarily through joint ventures with international banking groups. Through its subsidiaries, Fiat operates mainly in five business areas: Automobiles, Agricultural and Construction Equipment, Trucks and Commercial Vehicles, Components and Production Systems, and Other Businesses. On March 20, 2008, FPT Powertrain Technologies acquired 100% of Tritec Motors Limitada from Chrysler L.L.C. and subsequently changed its name to FPT Powertrain do Brasil-Industria e Comercio de Motores Ltda. During the year ended December 31, 2008, the Company acquired remaining 0.33% interest in European Engine Alliance. About Chrysler LLC Headquartered in Auburn Hills, Michigan, Chrysler LLC -- http://www.chrysler.com/-- a unit of Cerberus Capital Management LP, produces Chrysler, Jeep(R), Dodge and Mopar(R) brand vehicles and products. The company has dealers worldwide, including Canada, Mexico, U.S., Germany, France, U.K., Argentina, Brazil, Venezuela, China, Japan and Australia. * * * As reported in the Troubled Company Reporter on Dec. 3, 2008, Dominion Bond Rating Service downgraded the ratings of Chrysler LLC, including Chrysler's Issuer Rating to CC from CCC (high). Chrysler's First Lien Secured Credit Facility and Second Lien Secured Credit Facility have also been downgraded to CCC and CC (low) respectively. All trends are Negative. The ratings action reflects Chrysler's challenge to maintain sufficient liquidity balances amid severe industry conditions that have deteriorated alarmingly over the past few months and are not expected to improve in the near term. With this ratings action, Chrysler is removed from Under Review with Negative Implications, where it was placed on Nov. 7, 2008. As reported in the Troubled Company Reporter on Aug. 11, 2008, Standard & Poor's Ratings Services lowered its ratings on Chrysler LLC, including the corporate credit rating, to 'CCC+' from 'B-'. On July 31, 2008, TCR said that Fitch Ratings downgraded the Issuer Default Rating of Chrysler LLC to 'CCC' from 'B-'. The Rating Outlook is Negative. The downgrade reflects Chrysler's restricted access to economic retail financing for its vehicles, which is expected to result in a further step-down in retail volumes. Lack of competitive financing is also expected to result in more costly subvention payments and other forms of sales incentives. Fitch is also concerned with the state of the securitization market and the ability of the automakers to access this market on an economic basis over the near term, given the steep drop in residual values, higher default rates, higher loss severity being experienced and jittery capital market. As reported in the TCR on Dec. 3, 2008, Dominion Bond Rating Service downgraded on Nov. 20, 2008, the ratings of Chrysler LLC, including Chrysler's Issuer Rating to CC from CCC (high). Chrysler's First Lien Secured Credit Facility and Second Lien Secured Credit Facility have also been downgraded to CCC and CC (low) respectively. All trends are Negative. The ratings action reflects Chrysler's challenge to maintain sufficient liquidity balances amid severe industry conditions that have deteriorated alarmingly over the past few months and are not expected to improve in the near term. With this ratings action, Chrysler is removed from Under Review with Negative Implications, where it was placed on Nov. 7, 2008. FIAT SPA: Looks to CNH's US$5-Bln Loan Payment for Funding ---------------------------------------------------------- Bob Tita at Dow Jones Newswires reports Fiat SpA is relying on the repayment of internal loans by its farm equipment arm to ease its own liquidity squeeze and help fund a planned investment in Chrysler LLC. According to the report, CNH Global N.V. owes Fiat more than US$5 billion, however, a spokesman for CNH said the total amount that will be paid to Fiat won't be known until later in the year. About US$3 billion of the US$5.2 billion of CNH's outstanding Fiat loans mature in 2009, the report says. Fiat, which owns more than 90% of CNH, is looking for repayment of the internal loans as it seeks to acquire an initial 20% stake in Chrysler, the report discloses. The report relates Standard & Poor's, which lowered Fiat's credit rating Tuesday to below investment grade, said without money from CNH, Fiat lacks sufficient credit lines or cash to cover its financial maturities this year. About Fiat SpA Headquartered in Turin, Italy, Fiat SpA (BIT:F) -- http://www.fiatgroup.com/-- is principally engaged in the design, manufacture and sale of automobiles, trucks, wheel loaders, excavators, telehandlers, tractors and combine harvesters. Through its subsidiaries, Fiat operates mainly in five business areas: Automobiles, including sectors led by Maserati SpA, Ferrari SpA and Fiat Group Automobiles SpA, which design, produce and sell cars under the Fiat, Alfa Romeo, Lancia, Fiat Professional, Abarth, Ferrari and Maserati brands; Agricultural and Construction Equipment, which is led by Case New Holland Global NV; Trucks and Commercial Vehicles, which is led by Iveco SpA; Components and Production Systems, which includes the sectors led by Magneti Marelli Holding SpA, Teksid SpA, Comau SpA and Fiat Powertrain Technologies SpA, and Other Businesses, which includes the sectors led by Fiat Services SpA, a publishing house Editrice La Stampa SpA and an advertising agency Publikompass SpA. * * * As reported in the Troubled Company Reporter-Europe on Feb. 25, 2009, Moody's Investors Service downgraded Fiat S.p.A's long term ratings to Ba1 from Baa3 and its short term ratings to Not Prime from Prime-3. The outlook on the ratings is negative. At the same time Moody's assigned a Ba1 Corporate Family Rating. The rating action concluded Moody's review for downgrade initiated on January 15, 2009. TELECOM ITALIA: Barred from Using Voting Rights in Argentine Unit ----------------------------------------------------------------- Chiara Remondini and Paul Tobin at Bloomberg News report that Telecom Italia SpA was ordered by The Argentine Competition Commission to stop using its voting rights in local unit Telecom Argentina SA. Citing a ruling on the authority's Web site, the report relates Telecom Italia's directors on Telecom Argentina's board were told to abstain from exercising voting powers while the regulator investigates Telco SpA's purchase of a controlling stake in Telecom Italia. According to Bloomberg News, Telefonica SA, Assicurazioni Generali SpA, Intesa Sanpaolo SpA, Mediobanca SpA and the Benetton family gained control of Telecom Italia, through holding company Telco, in October 2007. Telco owns 24.5 percent of the Milan-based company. The report recalls on Jan. 9, the Argentine regulator ordered Telefonica, which also runs Telefonica de Argentina SA, and its partners to provide documents on their stake in Telecom Italia. Telecom Italia has said it plans to exercise an option to increase its stake in Sofora Telecomunicaciones SA, the holding company that controls Telecom Argentina, the country's second- biggest phone provider, Bloomberg News relates. In December, the commission ordered Telecom Italia not to exercise the option to raise its stake in Sofora until the regulator issues a final decision, the report recalls. Denies Need for Fresh Funds As reported in the Troubled Company Reporter-Europe on Mar. 5, 2009, The Financial Times said Telecom Italia SpA denied a press report that it might need to tap shareholders for cash to pay for its investment plans. The company has ample ability to finance its debt and does not need a capital injection from investors, Chief Executive Officer Franco Bernabe was cited by FT as saying. According to FT, Mr. Bernabe said Telecom Italia's EUR34 billion (US$42.8 billion) of net debt was sustainable noting that the company had already refinanced 25 per cent of its debt so far this year. "We have no problem whatsoever in funding our debt," Mr. Bernabe said, adding that the company had also been able to cut its debt by EUR1.7 billion in 2008 as a consequence of "a very strong decline in costs". About Telecom Italia S.p.A. Telecom Italia S.p.A. (NYSE:TI) -- http://www.telecomitalia.it/ -- is an Italy-based telecommunications group that operates in the communications sector, in the television sector using both analog and digital terrestrial technology, and in the office products sector. The Company is engaged principally in the communications sector and, particularly, in telephone and data services on fixed lines, for final retail customers and wholesale providers, in the development of fiber optic networks for wholesale customers, in Internet services, in domestic and international mobile telecommunications (especially in Brazil), in the television sector using both analog and digital terrestrial technology and in the office products sector. The Company operates mainly in Europe, the Mediterranean Basin and in South America. In August 2008, ILIAD SA announced that it had finalized the acquisition of Alice France, the broadband operations of the Company. =================== K A Z A K H S T A N =================== ALLIANCE POLIS: Creditors Must File Claims by May 15 ---------------------------------------------------- Branch of JSC Insurance Company Alliance Polis has declared insolvency. Creditors have until May 15, 2009, to submit written proofs of claim to: Furmanov St. 273a Almaty Kazakhstan ALTYN OZAT: Creditors Must File Claims by May 15 ------------------------------------------------ The Specialized Inter-Regional Economic Court of East Kazakhstan has declared LLP Altyn Ozat insolvent. Creditors have until May 15, 2009, to submit written proofs of claim to: Bajov St. 2 070000 Ust-Kamenogorsk East Kazakhstan Kazakhstan The Court is located at: The Specialized Inter-Regional Economic Court of East Kazakhstan Bajov St. 2 070000 Ust-Kamenogorsk East Kazakhstan Kazakhstan ATYRAU OIL: Creditors Must File Claims by May 15 ------------------------------------------------ LLP Atyrau Oil Product Ltd. has declared insolvency. Creditors have until May 15, 2009, to submit written proofs of claim to: Azattyk Ave. 74v Atyrau Kazakhstan BIRLIK OJSC: Creditors Must File Claims by May 15 ------------------------------------------------- The Specialized Inter-Regional Economic Court of Akmola has declared OJSC Birlik insolvent. Creditors have until May 15, 2009, to submit written proofs of claim to: Gorky St. 37 Kokshetau Akmola Kazakhstan The Court is located at: The Specialized Inter-Regional Economic Court of Akmola Gorky St. 37 Kokshetau Akmola Kazakhstan EK OIL INVEST: Creditors Must File Claims by May 15 --------------------------------------------------- The Specialized Inter-Regional Economic Court of Almaty has declared LLP EK Oil Invest Kz insolvent. Creditors have until May 15, 2009, to submit written proofs of claim to: Tauelsyzdyk St. 53 Taldykorgan Almaty Kazakhstan The Court is located at: The Specialized Inter-Regional Economic Court of Almaty Tauelsyzdyk St. 53 Taldykorgan Almaty Kazakhstan SADY PRIDONYA: Creditors Must File Claims by May 15 --------------------------------------------------- OJSC Sady Pridonya has declared insolvency. Creditors have until May 15, 2009, to submit written proofs of claim to: Abulhair Han Ave. 2 Aktobe Aktube Kazakhstan STROY GAS: Creditors Must File Claims by May 15 ----------------------------------------------- LLP Kaz Stroy Gas has declared insolvency. Creditors have until May 15, 2009, to submit written proofs of claim to: Azattyk Ave. 99a/35 Atyrau Kazakhstan T-A-TELECOM-A LLP: Creditors Must File Claims by May 15 ------------------------------------------------------- The Specialized Inter-Regional Economic Court of Almaty has declared LLP T-A-Telecom-A insolvent. Creditors have until May 15, 2009, to submit written proofs of claim to: Baizakov St. 273b Almaty Kazakhstan The Court is located at: The Specialized Inter-Regional Economic Court of Almaty Baizakov St. 273b Almaty Kazakhstan VK STROYCOM: Creditors Must File Claims by May 15 ------------------------------------------------- The Specialized Inter-Regional Economic Court of East Kazakhstan has declared LLP VK Stroycom insolvent. Creditors have until May 15, 2009, to submit written proofs of claim to: Bajov St. 2 070000 Ust-Kamenogorsk East Kazakhstan Kazakhstan The Court is located at: The Specialized Inter-Regional Economic Court of East Kazakhstan Bajov St. 2 070000 Ust-Kamenogorsk East Kazakhstan Kazakhstan =================== K Y R G Y Z S T A N =================== ESSEX GLOBAL LLC: Creditors Must File Claims by April 17 -------------------------------------------------------- Creditors of LLC Essex Global have until April 17, 2009, to submit proofs of claim to: Chuikov St. 132 Bishkek Kyrgyzstan Tel: (+996 312) 31-60-83 ONENESS CO: Creditors Must File Claims by April 17 -------------------------------------------------- Creditors of LLC Oneness Co. Ltd. have until April 17, 2009, to submit proofs of claim. The company can be reached at: LLC Oneness Co. Ltd. Tel: (+996 312) 61-24-93 (0-772) 51-51-30 ================== L U X E MB O U R G ================== BLACK DIAMOND: S&P Cuts Rating on Class E of 2006-1 Notes to 'B-' ----------------------------------------------------------------- Standard & Poor's Ratings Services lowered its ratings on the class D and E notes issued by Black Diamond CLO 2006-1 (Luxembourg) S.A. and removed the rating on the class E notes from CreditWatch negative, where it was placed on Dec. 5, 2008. Concurrently, S&P affirmed its ratings on seven classes from this transaction. Black Diamond CLO 2006-1 (Luxembourg) S.A. is a cash flow collateralized loan obligation transaction. The lowered ratings primarily reflect negative rating migration of the corporate names in the underlying portfolio. As of the March 16, 2009, trustee report, Standard & Poor's rated 12.23% of the collateral underlying the transaction in the 'CCC' category. In addition, the March 16, 2009, report reflected $56.48 million in defaults. Standard & Poor's will continue to monitor the transaction to ensure that, in S&P's view, the ratings currently assigned to the notes remain consistent with the credit enhancement available to support them. Rating Lowered Black Diamond CLO 2006-1 (Luxembourg) S.A. Rating ------ Class To From Balance (mil. $) ----- -- ---- ---------------- D BB+ BBB 55.000 Rating Lowered and Removed from Creditwatch Negative Black Diamond CLO 2006-1 (Luxembourg) S.A. Rating ------ Class To From Balance (mil. $) ----- -- ---- ---------------- E B- BB/Watch Neg 45.000 Ratings Affirmed Black Diamond CLO 2006-1 (Luxembourg) S.A. Class Rating Bal. (mil. $) ----- ------ ------------- X AAA 12.750 A-D AAA 500.000 A-E AAA 79.753 A-R AAA 82.302 B AA 90.000 C A 48.000 P AAA 4.541 Transaction Information ----------------------- Issuer: Black Diamond CLO 2006-1 (Luxembourg) S.A. Co-issuer: Black Diamond CLO 2006-1 (Delaware) Corp. Underwriter: Bear Stearns Cos. LLC Trustee: Bank of New York Mellon Trust Co. N.A. ===================== N E T H E R L A N D S ===================== AMSTEL SCO: Moody's Reviews Ba2-Rated Class E Notes for Downgrade ----------------------------------------------------------------- Moody's Investors Service has placed under review for possible downgrade its ratings of seven classes of notes issued by Amstel SCO 2006-1 B.V. The transaction is a replenishable synthetic Balance Sheet CDO referencing a pool of bank originated corporate loans. The rating actions reflect the revision of certain key assumptions that the agency uses to rate and monitor corporate CDOs. These revised assumptions incorporate Moody's expectation that European and global corporate default rates are likely to greatly exceed their historical long-term averages and reflect the heightened interdependence of credit markets in the current global economic contraction. Specifically, the changes include: (1) a 30% increase in the assumed likelihood of default for corporate credits in CDOs (2) an increase in the degree to which ratings are adjusted according to other credit indicators such as rating Reviews and Outlooks and (3) an increase in the default correlation applied to corporate portfolios as generated through a combination of higher default rates and increased asset correlations. These revised assumptions are described in greater detail in the press release published on January 15, 2009. Moody's notes that the global corporate loan sector currently has a negative outlook and has shown signs of increasing weakness in terms of credit performance. The sector is further stressed by the anticipated limited refinancing opportunities for EMEA corporate issuers over the next six to twelve months. In addition, for the majority of the underlying referenced assets, the equivalent Moody's ratings used in Moody's analysis are obtained through a mapping process between the originator's internal rating scale and Moody's public rating scale. To compensate for the absence of credit indicators such as ratings reviews and outlooks in mapped ratings, a half notch stress was applied to the mapping scale. Because the mapping was performed prior to April 1, 2007, an additional stress was applied to capture potential deviations from the established mapping. Moody's initially analyzed and continues to monitor this transaction using primarily the methodology and its supplements for corporate synthetic CDOs as described in Moody's Special Reports and press releases below: -- Moody's Approach To Rating Corporate Collateralized Synthetic Obligations (March 2009) -- Framework for De-Linking Hedge Counterparty Risks from Global Structured Finance Cashflow Transactions (May 2007) -- Modeling Recovery Rates in European CDOs The rating actions are: Amstel SCO 2006-1 B.V. -- Class A, Aaa and Placed Under Review for Possible Downgrade; previously on 4 April 2007 Assigned Aaa -- Class A+1, Aaa and Placed Under Review for Possible Downgrade; previously on 4 April 2007 Assigned Aaa -- Class A+2, Aaa and Placed Under Review for Possible Downgrade; previously on 4 April 2007 Assigned Aaa -- Class B, Aa2 and Placed Under Review for Possible Downgrade; previously on 4 April 2007 Assigned Aa2 -- Class C, A2 and Placed Under Review for Possible Downgrade; previously on 4 April 2007 Assigned A2 -- Class D, Baa2 and Placed Under Review for Possible Downgrade; previously on 4 April 2007Assigned Baa2 -- Class E, Ba2 and Placed Under Review for Possible Downgrade; previously on 4 April 2007 Assigned Ba2 ARRAN CORP: Moody's Cuts Ratings on 6 Classes of Notes to Low-B --------------------------------------------------------------- Moody's Investors Service has downgraded its ratings of thirteen classes of notes issued by Arran Corporate Loans No 1 B.V. The transaction is a static (replenishment period ended in June 2007) synthetic Balance Sheet CDO referencing a pool of bank originated corporate loans. The rating actions reflect the revision of certain key assumptions that the agency uses to rate and monitor corporate CDOs. These revised assumptions incorporate Moody's expectation that European and global corporate default rates are likely to greatly exceed their historical long-term averages and reflect the heightened interdependence of credit markets in the current global economic contraction. Specifically, the changes include: (1) a 30% increase in the assumed likelihood of default for corporate credits in CDOs (2) an increase in the degree to which ratings are adjusted according to other credit indicators such as rating Reviews and Outlooks and (3) an increase in the default correlation applied to corporate portfolios as generated through a combination of higher default rates and increased asset correlations. These revised assumptions are described in greater detail in the press release published on January 15, 2009. Moody's notes that the global corporate loan sector currently has a negative outlook and has shown signs of increasing weakness in terms of credit performance. The sector is further stressed by the anticipated limited refinancing opportunities for EMEA corporate issuers over the next six to twelve months. In addition, for the majority of the underlying referenced assets, the equivalent Moody's ratings used in Moody's analysis are obtained through a mapping process between the originator's internal rating scale and Moody's public rating scale. To compensate for the absence of credit indicators such as ratings reviews and outlooks in mapped ratings, a half notch stress was applied to the mapping scale. Because the mapping was performed prior to April 1, 2007, an additional stress was applied to capture potential deviations from the established mapping. Moody's initially analyzed and continues to monitor this transaction using primarily the methodology and its supplements for corporate synthetic CDOs as described in Moody's Special Reports and press releases below: -- Moody's Approach To Rating Corporate Collateralized Synthetic Obligations (March 2009) -- Moody's updates key assumptions for rating corporate synthetic CDOs (January 2009) -- Framework for De-Linking Hedge Counterparty Risks from Global Structured Finance Cashflow Transactions (May 2007) -- Modeling Recovery Rates in European CDOs The rating actions are: Arran Corporate Loans No.1 B.V. -- GBP90,500,000 Class B1 Secured Floating Rate Notes due 2025, Downgraded to Aa1; previously on 23 May 2008 Upgraded to Aaa -- EUR110,000,000 Class B2 Secured Floating Rate Notes due 2025, Downgraded to Aa1; previously on 23 May 2008 Upgraded to Aaa -- US$73,000,000 Class B3 Secured Floating Rate Notes due 2025, Downgraded to Aa1; previously on 23 May 2008 Upgraded to Aaa -- GBP26,250,000 Class C1 Secured Floating Rate Notes due 2025, Downgraded to Aa3; previously on 23 May 2008 Upgraded to Aa1 -- EUR38,000,000 Class C2 Secured Floating Rate Notes due 2025, Downgraded to Aa3; previously on 23 May 2008 Upgraded to Aa1 -- GBP42,500,000 Class D1 Secured Floating Rate Notes due 2025, Downgraded to A3; previously on 23 May 2008 Upgraded to A1 -- EUR50,000,000 Class D2 Secured Floating Rate Notes due 2025, Downgraded to A3; previously on 23 May 2008 Upgraded to A1 -- GBP39,250,000 Class E1 Secured Floating Rate Notes due 2025, Downgraded to Ba1; previously on 23 May 2008 Upgraded to Baa2 -- EUR38,000,000 Class E2 Secured Floating Rate Notes due 2025, Downgraded to Ba1; previously on 23 May 2008 Upgraded to Baa2 -- US$28,000,000 Class E3 Secured Floating Rate Notes due 2025, Downgraded to Ba1; previously on 23 May 2008 Upgraded to Baa2 -- GBP70,500,000 Class F1 Secured Floating Rate Notes due 2025, Downgraded to B2; previously on 23 May 2008 Upgraded to Ba2 -- EUR10,000,000 Class F2 Secured Floating Rate Notes due 2025, Downgraded to B2; previously on 23 May 2008 Upgraded to Ba2 -- US$5,000,000 Class F3 Secured Floating Rate Notes due 2025, Downgraded to B2; previously on 23 May 2008 Upgraded to Ba2 =============== P O R T U G A L =============== BANIF SA: Moody's Puts 'D+' BFSR on Review for Possible Downgrade ----------------------------------------------------------------- Moody's Investors Service took these rating actions on Portuguese banks: (i) downgraded Banif SA's ratings to Baa1/P-2/D+ from A2/P-1/C- and placed them on review for possible further downgrade; (ii) downgraded the issuer rating of the holding company Espirito Santo Financial Group to A2 from A1 and placed it on review for possible further downgrade (iii) placed on review for possible downgrade the bank financial strength ratings and long-term debt and deposit ratings of six Portuguese banks: Caixa Geral de Depositos (rated Aa1/P-1/C), Banco Comercial Portugues (Aa3/P-1/C+), Banco Espírito Santo (Aa3/ P-1/C+), Banco Santander Totta SA (Aa3/P-1/C+), Banco BPI (A1/P-1/ C) and Caixa Economica Montepio Geral ((A2/P-1/C-); the review for downgrade also includes the short-term ratings); and (iv) changed the outlook on Banco Itau Europa SA's C-/Baa1/P-2 ratings to negative. The rating actions are prompted by the weakening of the Portuguese economic environment, as reflected by Moody's negative credit outlook on the Portuguese banking system, and pressure on the banks' current capitalization levels as a result of relatively poor performances in 2008, anticipated lower revenue over the next few years and higher credit-related write-down requirements. Reviews For Possible Downgrade Moody's review of the BFSRs of these institutions reflects that the intrinsic creditworthiness of all the rated banks has weakened and is likely to continue to weaken during the ongoing crisis as a result of one or a combination of several of these factors: (i) low capital levels; (ii) difficulties in generating new capital either internally through earnings or externally; (iii) high credit risk concentrations, in particular to corporates that may experience distress; (iv) growth in lending above the average for the system; (v) corporate governance issues ranging from overly complex organizational structures, to a lack of independent board members and/or related-party lending; (vi) exposure to market risk, which can further depress capital levels and/or contribute to volatility in revenues; (vii) slower growth in international operations and, in some cases, greater volatility of contributions from Eastern European or Spanish operations; and (viii) ongoing reliance on short-term market funding. The banks that are likely to be more adversely affected by the outcome of the review of the BFSRs are those with lower capitalization levels and higher expected losses on their risk assets. This reflects the fact that Moody's will place a greater emphasis on particular rating considerations such as capital and future earnings prospects as a result of the ongoing financial crisis. In reviewing the deposit and senior debt ratings, Moody's will consider (i) the high probability of support that is available to Portuguese banks and the probability of support once stability returns to the markets, (ii) the systemic importance of the rated institutions, (iii) the intrinsic financial strength of the rated institutions and (iv) other sources of external support, in particular parental support. Moody's expects the downgrades of the senior debt and deposit ratings to be limited in most cases to one or possibly two notches, while the downgrades of the BFSRs would likely be of a greater magnitude. BANIF The downgrade of Banif's ratings to Baa1/P-2/D+ (on review for possible further downgrade) from A2/P-1/C- reflects Moody's view that the majority of factors listed in the third paragraph (above) are present at this institution and that the expected credit losses and weak capitalization levels are no longer commensurate with A2/P-1/C- ratings. Moody's also downgraded Banif's dated and undated subordinated debt ratings to Baa2 and Baa3, respectively, from A3, and its preferred securities rating to Ba1 from Baa1 as a result of the downgrade of the bank's senior debt rating and the increased credit risk of hybrid instruments for those institutions that are more likely to need external support. As with the other financial institutions listed above (aside from Banco Itau Europa), Banif's ratings are on review for possible further downgrade, with the review focusing on the same key issues. Espirito Santo Financial Group The downgrade of Luxembourg-based ESFG's issuer rating to A2 (on review for possible further downgrade) from A1 reflects (i) the placing of the ratings of ESFG's subsidiary Banco Espírito Santo (BES, rated Aa3/P-1/C+) on review for downgrade and (ii) Moody's assessment that the very high probability of systemic support available to BES might not be extended to ESFG in case of need, given that, during the ongoing financial crisis, the Portuguese government has sometimes excluded holding companies from government support. The Affected Banks These entities were downgraded and placed on review for further possible downgrade: -- Banif - Banco Internacional do Funchal SA -- Espirito Santo Financial Group These entities were placed on review for possible downgrade: -- Caixa Geral de Depositos -- Banco Comercial Portugues -- Banco Espirito Santo -- Banco Santander Totta SA -- Banco BPI -- Caixa Economica Montepio Geral This entity's ratings were affirmed; the outlook on its ratings was changed to negative from stable: -- Banco Itau Europa SA Below is the full list of the banks and related funding vehicles affected by Moody's rating actions: Downgrades: Issuer: BANIF - Banco Internacional do Funchal, S.A. -- Bank Financial Strength Rating, Downgraded to D+, on review for possible downgrade, from C -- LT Bank Deposit, Downgraded to Baa1, on review for possible downgrade, from A2 -- ST Bank Deposit, Downgraded to Prime-2, on review for possible downgrade, from Prime-1 -- Senior Unsecured Debt Rating, Downgraded to Baa1, on review for possible downgrade, from A2 -- Dated Subordinate Debt Rating, Downgraded to Baa2, on review for possible downgrade, from A3 -- Undated Subordinate Debt Rating, Downgraded to Baa3, on review for possible downgrade, from A3 Issuer: Banif Finance, Limited -- Senior Unsecured Debt Rating, Downgraded to Baa1, on review for possible downgrade, from A2 -- Dated Subordinate Debt Rating, Downgraded to Baa2, on review for possible downgrade, from A3 -- Undated Subordinate Debt Rating, Downgraded to Baa3, on review for possible downgrade, from A3 -- Preferred Stock, Downgraded to Ba1, on review for possible downgrade, from Baa1 Issuer: Banif Sucursal Financeira Exterior -- Senior Unsecured Debt Rating, Downgraded to Baa1, on review for possible downgrade, from A2 -- Dated Subordinate Debt Rating, Downgraded to Baa2, on review for possible downgrade, from A3 -- Undated Subordinate Debt Rating, Downgraded to Baa3, on review for possible downgrade, from A3 Issuer: Espirito Santo Financial Group -- Issuer Rating, Downgraded to A2, on review for possible downgrade, from A1 Issuer: ESFG International Limited -- Preferred Stock, Downgraded to Baa1, on review for possible downgrade, from A3 On Review for Possible Downgrade: Issuer: Caixa Geral de Depositos, SA -- Bank Financial Strength Rating, Placed on Review for Possible Downgrade, currently C -- LT Bank Deposit, Placed on Review for Possible Downgrade, currently Aa1 -- Senior Unsecured Debt Rating, Placed on Review for Possible Downgrade, currently Aa1 -- Subordinate Debt Rating, Placed on Review for Possible Downgrade, currently Aa2 Issuer: Caixa Geral de Depositos SA (Madeira) -- Senior Unsecured Debt Rating, Placed on Review for Possible Downgrade, currently Aa1 Issuer: Caixa Geral de Depositos SA (Paris) -- Senior Unsecured Debt Rating, Placed on Review for Possible Downgrade, currently Aa1 -- Subordinate Debt Rating, Placed on Review for Possible Downgrade, currently Aa2 Issuer: Caixa Geral de Depositos Finance -- Senior Unsecured Debt Rating, Placed on Review for Possible Downgrade, currently Aa1 -- Subordinate Debt Rating, Placed on Review for Possible Downgrade, currently Aa2 Issuer: Caixa Geral de Depositos/New York -- LT Deposit Rating, Placed on Review for Possible Downgrade, currently Aa1 Issuer: Caixa Geral Finance Limited -- Preferred Stock, Placed on Review for Possible Downgrade, currently Aa3 Issuer: Banco Comercial Portugues, SA -- Bank Financial Strength Rating, Placed on Review for Possible Downgrade, currently C+ -- LT Bank Deposit, Placed on Review for Possible Downgrade, currently Aa3 -- Senior Unsecured Debt Rating, Placed on Review for Possible Downgrade, currently Aa3 -- Subordinate Debt Rating, Placed on Review for Possible Downgrade, currently A1 -- Preferred Stock, Placed on Review for Possible Downgrade, currently A2 Issuer: BCP Capital Finance Limited -- Preferred Stock, Placed on Review for Possible Downgrade, currently A2 Issuer: BCP International Bank Limited -- Backed Preferred Shelf, Placed on Review for Possible Downgrade, currently (P) A2 Issuer: BCP Finance Company -- Backed Subordinate Shelf, Placed on Review for Possible Downgrade, currently (P) A1 -- Preferred Stock, Placed on Review for Possible Downgrade, currently A2 Issuer: BCP Finance Bank Limited -- Senior Unsecured Debt Rating, Placed on Review for Possible Downgrade, currently Aa3 -- Subordinate Debt Rating, Placed on Review for Possible Downgrade, currently A1 Issuer: Banco Comercial Portugues SA (Madeira) -- Senior Unsecured Debt Rating, Placed on Review for Possible Downgrade, currently Aa3 -- Subordinate Debt Rating, Placed on Review for Possible Downgrade, currently A1 Issuer: Banco Espirito Santo SA -- Bank Financial Strength Rating, Placed on Review for Possible Downgrade, currently C+ -- LT Bank Deposit, Placed on Review for Possible Downgrade, currently Aa3 -- Senior Unsecured Debt Rating, Placed on Review for Possible Downgrade, currently Aa3 -- Subordinate Debt Rating, Placed on Review for Possible Downgrade, currently A1 Issuer: BES Finance Limited -- Senior Unsecured Debt Rating, Placed on Review for Possible Downgrade, currently Aa3 -- Subordinate Debt Rating, Placed on Review for Possible Downgrade, currently A1 -- Preferred Stock, Placed on Review for Possible Downgrade, currently A2 Issuer: Espirito Santo Investment plc -- Senior Unsecured Debt Rating, Placed on Review for Possible Downgrade, currently Aa3 -- Subordinate Debt Rating, Placed on Review for Possible Downgrade, currently A1 Issuer: Banco Espirito Santo SA London branch -- Senior Unsecured Debt and Deposit Ratings, Placed on Review for Possible Downgrade, currently Aa3 -- Subordinate Debt Rating, Placed on Review for Possible Downgrade, currently A1 Issuer: Banco Espirito Santo SA Cayman branch -- Senior Unsecured Debt and Deposit Ratings, Placed on Review for Possible Downgrade, currently Aa3 -- Subordinate Debt Rating, Placed on Review for Possible Downgrade, currently A1 Issuer: Banco Espirito Santo SA Madeira branch -- Senior Unsecured Debt and Deposit Ratings, Placed on Review for Possible Downgrade, currently Aa3 -- Subordinate Debt Rating, Placed on Review for Possible Downgrade, currently A1 Issuer: Banco Santander Totta SA -- Bank Financial Strength Rating, Placed on Review for Possible Downgrade, currently C+ -- LT Bank Deposit, Placed on Review for Possible Downgrade, currently Aa3 -- Senior Unsecured Debt Rating, Placed on Review for Possible Downgrade, currently Aa3 -- Subordinate Debt Rating, Placed on Review for Possible Downgrade, currently A1 Issuer: Banco Santander Totta SA, London -- Senior Unsecured Debt Rating, Placed on Review for Possible Downgrade, currently Aa3 -- Subordinate Debt Rating, Placed on Review for Possible Downgrade, currently A1 Issuer: Totta & Acores Financing Limited -- Preferred Stock, Placed on Review for Possible Downgrade, currently A2 Issuer: Banco BPI SA -- Bank Financial Strength Rating, Placed on Review for Possible Downgrade, currently C -- LT Bank Deposit, Placed on Review for Possible Downgrade, currently A1 -- Senior Unsecured Debt Rating, Placed on Review for Possible Downgrade, currently A1 -- Subordinate Debt Rating, Placed on Review for Possible Downgrade, currently A2 Issuer: BPI Capital Finance Limited -- Senior Unsecured Debt Rating, Placed on Review for Possible Downgrade, currently A1 -- Subordinate Debt Rating, Placed on Review for Possible Downgrade, currently A2 -- Preferred Stock, Placed on Review for Possible Downgrade, currently Baa1 Issuer: Banco BPI SA (Cayman) -- Senior Unsecured Debt Rating, Placed on Review for Possible Downgrade, currently A1 -- Subordinate Debt Rating, Placed on Review for Possible Downgrade, currently A2 Issuer: Banco BPI SA (Santa Maria) -- Senior Unsecured Debt Rating, Placed on Review for Possible Downgrade, currently A1 -- Subordinate Debt Rating, Placed on Review for Possible Downgrade, currently A2 Issuer: Banco BPI SA (Madeira) -- Senior Unsecured Debt Rating, Placed on Review for Possible Downgrade, currently A1 -- Subordinate Debt Rating, Placed on Review for Possible Downgrade, currently A2 Issuer: Banco BPI SA (Macau Offshore) -- Senior Unsecured Debt Rating, Placed on Review for Possible Downgrade, currently A1 -- Subordinate Debt Rating, Placed on Review for Possible Downgrade, currently A2 Issuer: Banco BPI Cayman Limited -- Senior Unsecured Debt Rating, Placed on Review for Possible Downgrade, currently A1 -- Subordinate Debt Rating, Placed on Review for Possible Downgrade, currently A2 Issuer: Caixa Economica Montepio Geral -- Bank Financial Strength Rating, Placed on Review for Possible Downgrade, currently C- -- LT Bank Deposit, Placed on Review for Possible Downgrade, currently A2 -- ST Bank Deposit, Placed on Review for Possible Downgrade, currently Prime-1 -- Senior Unsecured Debt Rating, Placed on Review for Possible Downgrade, currently A2/P-1 -- Subordinate Debt Rating, Placed on Review for Possible Downgrade, currently A3 Issuer: Caixa Economica Montepio Geral, Cayman Islands Branch -- Senior Unsecured Debt Rating, Placed on Review for Possible Downgrade, currently A2 -- Subordinate Debt Rating, Placed on Review for Possible Downgrade, currently A3 Outlook actions: Issuer: Banif - Banco Internacional do Funchal, S.A. -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Banif Finance, Limited -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Banif Sucursal Financeira Exterior -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Espirito Santo Financial Group -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: ESFG International Limited -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Caixa Geral de Depositos, SA -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Caixa Geral de Depositos SA (Madeira) -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Caixa Geral de Depositos SA (Paris) -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Caixa Geral de Depositos SA Finance -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Caixa Geral de Depositos/New York -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Caixa Geral Finance Limited -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Banco Comercial Portugues, SA -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: BCP Capital Finance Limited -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: BCP International Bank Limited -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: BCP Finance Company -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: BCP Finance Portugal -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Banco Comercial Portugues SA (Madeira) -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Banco Espirito Santo SA -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: BES Finance Limited -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Espirito Santo Investment plc -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Banco Espirito Santo SA London branch -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Banco Espirito Santo SA Cayman branch -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Banco Espirito Santo SA Madeira branch -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Banco Santander Totta SA -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Banco Santander Totta SA, London -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Totta & Acores Financing Limited -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Banco BPI SA -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: BPI Capital Finance Limited -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Banco BPI SA (Cayman) -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Banco BPI SA (Santa Maria) -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Banco BPI SA (Madeira) -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Banco BPI SA (Macau Offshore) -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Banco BPI Cayman Limited -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Caixa Economica Montepio Geral -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Caixa Economica Montepio Geral, Cayman Islands Branch -- Outlook, Placed on Review for Possible Downgrade from Stable Issuer: Banco Itau Europa SA, -- Outlook , Changed to Negative from Stable Moody's last rating action on Banif - Banco Internacional do Funchal SA was on April 13, 2007, when the bank's ratings were upgraded as result of the implementation of Moody's Joint Default Analysis and BFSR methodologies. Moody's last rating action on Espirito Santo Financial Group was on April 13, 2007, when the bank's ratings were upgraded as result of the implementation of Moody's Joint Default Analysis and BFSR methodologies. Moody's last rating action on Caixa Geral de Depositos was on April 13, 2007, when the bank's ratings were upgraded as result of the implementation of Moody's Joint Default Analysis and BFSR methodologies. Moody's last rating action on Banco Comercial Portugues was on April 13, 2007, when the bank's ratings were upgraded as result of the implementation of Moody's Joint Default Analysis and BFSR methodologies. Moody's last rating action on Banco Espirito Santo was on April 13, 2007, when the bank's ratings were upgraded as result of the implementation of Moody's Joint Default Analysis and BFSR methodologies. Moody's last rating action on Banco Santander Totta was on April 13, 2007, when the bank's ratings were upgraded as result of the implementation of Moody's Joint Default Analysis and BFSR methodologies. Moody's last rating action on Banco BPI was on April 13, 2007, when the bank's ratings were upgraded as result of the implementation of Moody's Joint Default Analysis and BFSR methodologies. Moody's last rating action on Caixa Economica Montepio Geral was on April 13, 2007, when the bank's ratings were upgraded as result of the implementation of Moody's Joint Default Analysis and BFSR methodologies. Moody's last rating action on Banco Itau Europa was on April 27, 2007, when the bank's ratings were affirmed as result of the implementation of Moody's Joint Default Analysis and BFSR methodologies. Headquartered in Lisbon, Caixa Geral de Depositos had total assets of EUR111.1 billion at the end of December 2008. Headquartered in Oporto, Banco Comercial Portugues had total assets of EUR94.4 billion at the end of December 2008. Headquartered in Lisbon, Banco Espirito Santo had total assets of EUR75.2 billion at the end of December 2008. Headquartered in Lisbon, Banco Santander Totta had (unaudited) total assets of EUR40.6 billion at the end of December 2008. Headquartered in Lisbon, Banco BPI had (unaudited) total assets of EUR43.0 billion at the end of December 2008. Headquartered in Lisbon, Caixa Economica Montepio Geral had total assets of EUR16.9 billion at the end of December 2008. Headquartered in Funchal, Banif SA had (unaudited) total assets of EUR7.8 billion at the end of December 2008. Headquartered in Lisbon, Banco Itau Europa had (unaudited) total assets of EUR5.0 billion at the end of December 2008. Headquartered in Luxembourg, Espirito Santo Financial Group had (unaudited) total assets of EUR78.1 billion at the end of December 2008. =========== R U S S I A =========== BAKALSKIY MINING: Creditors Must File Claims by April 27 -------------------------------------------------------- Creditors of LLC Bakalskiy Mining Equipment Plant have until April 27, 2009, to submit proofs of claims to: Yu. Sivachenko Temporary Insolvency Manager Prostysheva St. 7A 690048 Vladivostok Russia The Arbitration Court of Chelyabinskaya will convene at 4:00 p.m. on June 3, 2009, to hear bankruptcy supervision procedure. The case is docketed under Case No. A76–29054/2008–32-25. The Debtor can be reached at: Truda St. 175 454091 Chelyabinsk Russia BESLANSKIY ELECTROMECHANICAL: Court Names as Insolvency Manager --------------------------------------------------------------- The Arbitration Court of North Ossetia-Alania appointed R. Guriyev as Temporary Insolvency Manager for FSUE Beslanskiy Electromechanical Plant. The case is docketed under Case No. A61–61/09. He can be reached at: Apt. 48 Tsokolayeva St. 18/1 Vladikavkaz North Ossetia-Alania Russia BRK-ZHIL-STROY LLC: Creditors Must File Claims by May 27 -------------------------------------------------------- Creditors of LLC BRK-Zhil-Stroy (TIN 7729394130, PSRN 1037700105871) (Construction) have until May 27, 2009, to submit proofs of claims to: I. Rekunov Insolvency Manager Yelovaya alleya 26 Kaliningrad Russia The Arbitration Court of Moscow commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. A40–46950/08–71-134. The Debtor can be reached at: LLC BRK-Zhil-Stroy Building 1 Vorobyevskoe shosse 4 Moscow Russia ILAN-TRANS LLC: Creditors Must File Claims by May 27 ---------------------------------------------------- Creditors of LLC Ilan-Trans (TIN 7701521170, PSRN 1047796038168) (Transportation) have until May 27, 2009, to submit proofs of claims to: Yu. Runov Insolvency Manager A. Solzhenitsina St. 5 109004 Moscow Russia Tel: 912-48-91 979-3950 The Arbitration Court of Moscow commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. A40–26211/08–124-85B. The Debtor can be reached at: LLC Ilan-Trans B. Zlatoustinskiy pereulok 9 101000 Moscow Russia KLYAVLINSKIY OIL: Creditors Must File Claims by April 27 -------------------------------------------------------- Creditors of CJSC Klyavlinskiy Oil Refinery have until April 27, 2009, to submit proofs of claims to: T. Khaliullin Temporary Insolvency Manager Building 6 Tsvetnoy Blvd. 22 127051 Moscow Russia The Arbitration Court of Samarskaya commenced bankruptcy supervision procedure. The case is docketed under Case No. A55– 759/2009,. The Debtor can be reached at: CJSC Klyavlinskiy Oil Refinery Chkalova St. 60 Klyavlino Klyavlinskiy 446961 Samarskaya Russia MORDOV-AGRO-STROY OJSC: Creditors Must File Claims by April 27 -------------------------------------------------------------- Creditors of OJSC Mordov-Agro-Stroy (Construction) have until April 27, 2009, to submit proofs of claims to: A. Lisitsyn Temporary Insolvency Manager Prospect Lenina 13A Saransk Mordovia Russia The Arbitration Court of Mordovia will convene on Aug. 17, 2009, to hear bankruptcy supervision procedure. The case is docketed under Case No. A39–523/2009,. The Court is located at: The Arbitration Court of Mordovia Kommunisticheskaya St. 33 Saransk Mordovia Russia The Debtor can be reached at: OJSC Mordov-Agro-Stroy Proletarskaya St. 130 Saransk Mordovia Russia NATIONAL BANK: Moody's Cuts Bank Financial Strength Rating to 'E' ----------------------------------------------------------------- Moody's Investors Service has downgraded the long-term foreign and local currency deposit ratings and foreign currency senior unsecured debt ratings of National Bank Trust to Caa1 from B2, and the bank financial strength rating to E from E+. At the same time, Moody's Interfax Rating Agency has downgraded the long-term national scale credit ratings of NBT to Ba3.ru from Baa1.ru. Moscow-based Moody's Interfax is majority owned by Moody's, a leading global rating agency. The rating action concludes the review process initiated in November 2008 and reflects the impact of the current operating environment in Russia on NBT. The outlook for the deposit and debt ratings is negative while the BFSR has a stable outlook. The downgrade of NBT ratings reflects the impairment in the bank's franchise value as a result of curtailed lending activities -- with limited ability to resume them in the medium term at levels consistent with previous or anticipated activity -- which resulted in loss-making performance from the core lending activity. In addition, NBT's banking activities have been adversely affected by instability of the funding base which became evident in the escalating global financial crisis when NBT lost 26% of retail and 34% of corporate deposit funds during the period September- November 2008. "As a result of the deposit outflow, NBT had to resort to the Central Bank of Russia for liquidity. CBR funding accounts for ca. 22% of non-equity funding while other wholesale sources of short-term funding (ca. 12% of total non-equity funding) cannot be regarded as a reliable source of funding to support the business in the current environment," said Vladlen Kuznetsov, a Moscow- based Moody's Assistant Vice President-Analyst, and lead analyst for this issuer. Although the bank has good capitalization ratios, the economic capital is under considerable pressure as a result of NBT's significant involvement in higher-risk investment and structured lending which accounts for a substantial portion of the bank's equity. The bank's economic capital is also pressured by potential problems in the retail loan book which had been developed under the bank's relatively aggressive underwriting standards (reflected in historically high delinquencies). The negative outlook reflects Moody's opinion that there is potential for further pressure on NBT's financial metrics and funding base as a result of a prolonged and severe economic downturn in Russia. Moody's previous rating action on NBT was on November 27, 2008, when the deposit and debt ratings were downgraded to B2 and placed on review for a possible further downgrade. NBT is headquartered in Moscow, Russian Federation, but the majority of its business is located in the country's regions, supported by its wide regional branch network. It had total consolidated assets of ca. RUB86 billion (ca. US$2.6 billion) and total equity of ca. RUB16 billion under IFRS at year-end 2008, and ranked among the 50 largest banks by total assets. PLESETSKIY WOOD-SAWING: Creditors Must File Claims by April 27 -------------------------------------------------------------- Creditors of CJSC Plesetskiy Wood-Sawing Enterprise have until April 27, 2009, to submit proofs of claims to: B. Orishchich Temporary Insolvency Manager Apt. 52 Building 2 Prospect Dzerzhinskogo17 163051 Arkhangelsk Russia The Arbitration Court of Arkhangelsk will convene at 2:00 p.m. on May 29, 2009, to hear bankruptcy supervision procedure. The case is docketed under Case No. A05 - 11909/2008. The Debtor can be reached at: CJSC Plesetskiy Wood-Sawing Enterprise Udarnikov St. 1 Plesetsk 164260 Arkhangelsk Russia PROM-ATOM-KOMPLEKTATSIYA LLC: Claims Deadline is May 27 ------------------------------------------------------- Creditors of LLC Prom-Atom-Komplektatsiya (TIN 7714188921) (Steel Solid-Drawn Pipe Spare Parts Production) have until May 27, 2009, to submit proofs of claims to: I. Gulakov Insolvency Manager Post User Box 29 Protvino Moskovskaya Russia The Arbitration Court of Moscow commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. A40–39208/08–74–125B. The Debtor can be reached at: LLC Prom-Atom-Komplektatsiya Building 1 Pravdy St. 21 125040 Moscow Russia PROM-ENERGO-SERVIS LLC: Creditors Must File Claims by April 27 -------------------------------------------------------------- Creditors of LLC Prom-Energo-Servis (TIN 5053029556, PSRN 1045010653577) (Boiler-Plants) have until April 27, 2009, to submit proofs of claims to: M. Vasilega Insolvency Manager Post User Box 100 105318 Moscow Russia The Arbitration Court of Moskovskaya commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. A41–1778/09. The Debtor can be reached at: LLC Prom-Energo-Servis Krasnaya St. 30B Elektrostal’ 144002 Moskovskaya Russia PSKOV-LESO-PRODUKT LLC: Court Names Insolvency Manager ------------------------------------------------------ The Arbitration Court of Pskovskaya appointed Ye.Pukhova as Insolvency Manager for LLC Pskov-Leso-Produkt (Forestry). The case is docketed under Case No. A52–4438/2008. He can be reached at: Karyernaya St. 2/22 153034 Ivanovo Russia SOCHI-GRAD-STROY LLC: Creditors Must File Claims by April 27 ------------------------------------------------------------ Creditors of LLC Sochi-Grad-Stroy Managing Company (TIN 2320006911, PSRN 1032311674120) (Construction) have until April 27, 2009, to submit proofs of claims to: L. Gridina Temporary Insolvency Manager Apt. 2 Mira St. 44 350063 Krasnodar Russia E-mail: gridinn@mail.ru The Arbitration Court of Krasnodarskiy will convene on June 23, 2009, to hear bankruptcy supervision procedure. The case is docketed under Case No. A-32–23363/2008–27/1421B. SOTSGORBANK: Moody's Assigns 'E+' Bank Financial Strength Rating ---------------------------------------------------------------- Moody's Investors Service has assigned these global scale ratings to Sotsgorbank: E+ bank financial strength rating, B3 long-term, and Not Prime short-term local and foreign currency deposit ratings. Concurrently, Moody's Interfax Rating Agency assigned a long-term national scale rating of Baa2.ru to Sotsgorbank. Moscow-based Moody's Interfax is majority-owned by Moody's, a leading global rating agency. The outlook on the BFSR and long- term deposit ratings is stable, while the national scale rating carries no specific outlook. Sotsgorbank's E+ BFSR, which translates into a Baseline Credit Assessment of B3, is underpinned by its relatively good risk management processes and reasonably sound liquidity position. Sotsgorbank has a dedicated and experienced management that also controls the bank. The bank's corporate governance system and overall transparency is also advanced compared to many peers. However, the bank's BFSR is constrained by its relatively small size and limited franchise, rapid loan growth in the past few years, substantial borrower and industry concentrations (construction and real estate, amounting to 21% of its gross loan book), and modest profitability. Moody's believes that the bank's weakening asset quality and low recurring profitability may prove challenging for its capitalization in the near term. Moody's notes that Sotsgorbank's B3 deposit ratings do not factor in any probability of systemic support and are in line with the bank's B3 BCA. According to Moody's, Sotsgorbank's ratings have limited upside potential in the short term; however, they may benefit from stabilization in its asset quality provided that the bank reports acceptable capitalization and liquidity. Conversely, the bank's ratings could come under pressure in the event of a significant deterioration in asset quality or liquidity position. Headquartered in Moscow, Russia, Sotsgorbank reported total assets of US$654 million, shareholders equity of US$89 million and net income of US$2.7 million as of end-H1 2008, according to the bank's IFRS financial report. ULYANOVSK HEAV: Ulyanovskaya Bankruptcy Hearing Set July 17 ----------------------------------------------------------- The Arbitration Court of Ulyanovskaya will convene at 9:30 a.m. on July 17, 2009, to hear bankruptcy supervision procedure on OJSC Ulyanovsk Heavy and Only Machine Plant (TIN 7303001461, PSRN 102701481261). The case is docketed under Case No. A72– 346/2009,. The Temporary Insolvency Manager is: L. Lazarenko Aviatsionnaya St. 5 302010 Orel Russia The Debtor can be reached at: OJSC Ulyanovsk Heavy and Only Machine Plant Gerasimova St. 10 432042 Ulyanovsk Russia URAL BANK: Moody's Withdraws 'E' Bank Financial Strength Rating --------------------------------------------------------------- Moody's Investors Service has withdrawn these ratings of Ural Bank for Reconstruction and Development: -- Bank financial strength rating of E -- the long-term and short-term foreign and local currency deposit ratings of Caa1/Not Prime Concurrently, Moody's Interfax Rating Agency withdrew UBRD's long- term national scale rating of Ba3.ru. Moscow-based Moody's Interfax is majority owned by Moody's, a leading global rating agency. Moody's has withdrawn these ratings for business reasons following the official request from the bank. Moody's notes that, as of the date of the ratings withdrawal, UBRD had no senior unsecured, subordinate or structured finance obligations rated by Moody's. UBRD's domestic rouble-denominated bonds maturing in July 2009 were not rated by Moody's. Moody's previous rating action on UBRD was on February 17, 2009, when the rating agency downgraded the bank's long-term local and foreign currency deposit ratings, BFSR and NSR to Caa1/Not Prime/E/Ba3.ru from B3/Not Prime/E+/Baa3.ru and assigned a negative outlook on the bank's global scale ratings. The negative outlook on UBRD's deposit ratings reflected Moody's expectations that the weakening trends for the bank's asset quality -- and hence profitability and capital adequacy -- would continue in the future and therefore put further pressure on the bank's existing ratings. Domiciled in Yekaterinburg, Russia, UBRD reported total IFRS assets of US$1.652 billion, total shareholders' equity of US$176 million and a net income of US$13 million as at December 31, 2007. ========= S P A I N ========= BANCAJA-BVA VPO: Moody's Assigns 'Ba3' Rating on Series D Notes --------------------------------------------------------------- Moody's Investors Service has assigned these definitive ratings to the series of residential mortgage-backed securitization bonds to be issued by BANCAJA-BVA VPO 1 Fondo de Titulizacion de Activos, a Spanish Asset Securitisation Fund created by Europea de Titulizacion, S.A., S.G.F.T.: -- Aaa to the EUR371.4 million Series A notes -- A1 to the EUR7.8 million Series B notes -- Baa2 to the EUR5.1 million Series C notes -- Ba3 to the EUR5.7 million Series D notes The ratings address the expected loss posed to investors by the legal final maturity (July 2051). In Moody's opinion, the structure allows for timely payment of interest and ultimate payment of principal at par on or before the rated final legal maturity date on Series A, B, C and D. 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. The BANCAJA-BVA VPO 1 transaction consists of the securitization of a pool of first-lien residential mortgage loans originated and serviced by two Spanish savings banks: Bancaja (84.5% of the provisional portfolio) and Banco de Valencia (15.5%). BANCAJA-BVA VPO 1, FTA is a Spanish RMBS transaction carried out outside of the ICO FTVPO program but the final portfolio will be complying with all the conditions required under that guarantee programme. Approximately 82.25% of the loans in the provisional portfolio are backed by mortgages over VPO properties. VPOs are residential properties that are offered at a lower price than the market value as a result of subsidies provided by the government to construction companies, which enables them to reduce the final purchase price of the property. The VPO sector is further characterized by subsidies provided by the government to individual households to enable them to maintain mortgage instalments. According to Moody's, this deal benefits from several strengths, including these: (1) a 1.95% reserve fund that is fully funded at closing to cover any potential shortfall in interest and principal; (2) a 18-month artificial write-off mechanism; (3) an interest rate swap to hedge interest rate risk in the transaction that also secures the weighted average interest rate on the notes plus 50 bps; and (4) relatively good collateral in terms of weighted average LTV (67.69%) and seasoning (4.16 years) However, the transaction poses several challenging features, namely: (1) 76% of the pool is concentrated in the region of Valencia; (2) around 13% of high LtV loans (over 80%) in the free market subpool; (3) the deferral of interest payments on each of Series B, C and D benefits the repayment of the series senior to each of them, but increases the expected loss on Series B, C and D themselves; and (4) The pro-rata amortization of Series B, C and D leads to reduced credit enhancement of the senior series in absolute terms. These increased risks were reflected in the ratings of the notes. As of February 2008, the provisional portfolio comprised 7,667 loans. The loans have been originated between 1999 and 2007, with a weighted average seasoning of 4.16 years. The interest rate is floating for all the loans. All the loans are secured by a first- lien mortgage guarantee. The total weighted average loan-to-value is 67.69% Moody's based the ratings primarily on: (i) an evaluation of the underlying portfolio of loans; (ii) analysis of the collateral historical performance; (iii) the swap agreements hedging the interest rate risk; (iv) the credit enhancement provided by the reserve fund, the subordination of the notes, and the excess spread; and (v) the legal and structural integrity of the transaction. The key parameters used to calibrate the loss distribution curve for this portfolio include a Milan Aaa CE of 7.35% and an expected loss 1.90% The Spanish Government announced on November 4, 2008, a package of aid to assist unemployed, self employed and pensioneer borrowers through a form of mortgage subsidy aid. It is unclear how the transaction will be affected, although both liquidity and credit implications are possible on this portfolio. However, any implications on the ratings will ultimately depend on the actual financial aid conditions which will be approved. FTPYME BANCAJA 3: S&P Cuts Rating on Class D Notes to 'BB-' ----------------------------------------------------------- Standard & Poor's Ratings Services took various rating actions on the notes issued by FTPYME Bancaja 3, Fondo de Titulizacion de Activos and FTPYME Bancaja 6, Fondo de Titulizacion de Activos. Specifically, S&P: -— lowered and removed from CreditWatch negative S&P's ratings on two tranches; -— lowered S&P's ratings on two tranches; —- kept two tranches on CreditWatch negative; and —- affirmed S&P's ratings on all the other classes of notes. The rating actions follow a full credit and cash flow analysis of the most recent transaction information and loan-level data S&P has received for these particular Spanish small and midsize enterprise transactions originated by Caja de Ahorros de Valencia, Castellon y Alicante (Bancaja). On Dec. 15, 2008, S&P lowered S&P's ratings on the junior classes of notes in both transactions, placed on CreditWatch negative the mezzanine tranche in FTPYME Bancaja 3, and lowered and placed on CreditWatch negative the mezzanine tranche in FTPYME Bancaja 6. Performance has continued to deteriorate in recent months and the arrears growth rate reported by the two transactions has remained higher than the average observed in other Spanish SME deals S&P rate. S&P believes the current economic downturn is affecting these two deals more than others due to their collateral characteristics. Given Spain's current economic outlook, S&P believes that the two deals will face challenges in the near to medium term. S&P's credit review focused on various risks embedded in the two pools backing the deals. In particular, S&P is concerned about relatively high asset concentrations, both in the real estate and construction sector as well as in one single region. FTPYME Bancaja 3 and FTPYME Bancaja 6 assets are concentrated in the real estate and construction sectors—48.08% and 57.36%, respectively. Most of the loans were originated in the Valencia region, which is the originator's core business area (55.82% and 56.69%, respectively). Finally, S&P assessed the negative effect of loans granted to developers and obligor concentration. The latter could be more important for the FTPYME Bancaja 3 pool. As of the last investor report, the collateral comprises 830 loans and the top 10 borrowers represent 14.77% of the pool. The FTPYME Bancaja 6 pool comprises 2,260 loans and the top 10 lenders represent 8.76%. FTPYME Bancaja 3 S&P puts the results of its credit analysis into S&P's cash flow analysis, which showed that the junior notes in FTPYME Bancaja 3 cannot maintain their current ratings. The transaction benefits from high asset seasoning and a very low pool factor, only 19.8% of the closing balance. Nevertheless, the continuous deterioration in pool performance has substantially eroded the deal's excess spread in recent periods. As of February 2009, 90+ day arrears were 7.4% of the pool. Beyond the pool amortization effect, the increase in delinquency amount is still a relevant driver of the permanent of delinquency rate growth. 90+ day arrears grew to EUR12.5 million in February 2009 from EUR9.8 million in December 2008. Finally, the cash reserve was drawn on the March payment date because the fund had to amortize notes for EUR3.2 million of defaulted loans (loans in arrears for more than 12 months). The reserve fund is now at EUR4.8 million, versus the required level of EUR5.0 million. S&P concluded that the credit enhancement available to the class C and D notes in FTPYME Bancaja 3 was insufficient to maintain the current ratings. Consequently, S&P lowered its rating on the class C and D notes. S&P also kept the class A3(G) and B notes on CreditWatch negative because of their exposure to Bancaja as swap counterparty. FTPYME Bancaja 6 The results of S&P's credit and cash flow analysis showed that the credit enhancement available to the class B and C notes was insufficient to maintain the current ratings. Loans in arrears for more than 90 days account for 10.4% of the pool (as of the end of February), up by 591 basis points since September 2008. Due to the pool's characteristics, the effect of the economic slowdown is having a higher impact on this deal than the market average. FTPYME Bancaja 6 will start accruing written-off loans (i.e., loans in arrears for more than 18 months) from the next payment date (June). Interest deferral triggers are based on cumulative default and set at 3.75% for class C and 5.75% for class B. A breach of the trigger will potentially result in the junior and mezzanine notes experiencing an interest shortfall, while the senior notes will deleverage more quickly. Given the current transaction performance and S&P's expectation that a significant portion of current long-term arrears could roll into default, S&P believes that the likelihood of a breach of this trigger has increased. This negatively affected S&P's ratings on the junior tranches, but this feature of the structure is providing a good level of protection to the senior classes. As a result, S&P lowered its ratings on the class B and C notes and affirmed S&P's ratings on classes A2 and A3(G). Ratings List Ratings Lowered and Removed from Creditwatch Negative FTPYME Bancaja 3, Fondo de Titulizacion de Activos EUR900 Million Floating-Rate Notes Class To From ----- -- ---- C BBB BBB+/Watch Neg FTPYME Bancaja 6, Fondo de Titulizacion de Activos EUR1.028 Billion Floating-Rate Notes Class To From ----- -- ---- B BB BBB/Watch Neg Ratings Lowered FTPYME Bancaja 3, Fondo de Titulizacion de Activos EUR900 Million Floating-Rate Notes Class To From ----- -- ---- D BB- BB FTPYME Bancaja 6, Fondo de Titulizacion de Activos EUR1.028 Billion Floating-Rate Notes Class To From ----- -- ---- C B- B Ratings Kept on Creditwatch Negative FTPYME Bancaja 3, Fondo de Titulizacion de Activos EUR900 Million Floating-Rate Notes Class Rating ----- ------ A3(G) AAA/Watch Neg B AA-/Watch Neg Ratings Affirmed FTPYME Bancaja 6, Fondo de Titulizacion de Activos EUR1.028 Billion Floating-Rate Notes Class Rating ----- ------ A2 AAA A3(G) AAA D CCC- FTPYME BANCAJA 6: S&P Affirms Rating on Class D Notes at 'CCC-' --------------------------------------------------------------- Standard & Poor's Ratings Services took various rating actions on the notes issued by FTPYME Bancaja 3, Fondo de Titulizacion de Activos and FTPYME Bancaja 6, Fondo de Titulizacion de Activos. Specifically, S&P: -— lowered and removed from CreditWatch negative S&P's ratings on two tranches; -— lowered S&P's ratings on two tranches; —- kept two tranches on CreditWatch negative; and —- affirmed S&P's ratings on all the other classes of notes. The rating actions follow a full credit and cash flow analysis of the most recent transaction information and loan-level data S&P has received for these particular Spanish small and midsize enterprise transactions originated by Caja de Ahorros de Valencia, Castellon y Alicante (Bancaja). On Dec. 15, 2008, S&P lowered S&P's ratings on the junior classes of notes in both transactions, placed on CreditWatch negative the mezzanine tranche in FTPYME Bancaja 3, and lowered and placed on CreditWatch negative the mezzanine tranche in FTPYME Bancaja 6. Performance has continued to deteriorate in recent months and the arrears growth rate reported by the two transactions has remained higher than the average observed in other Spanish SME deals S&P rate. S&P believes the current economic downturn is affecting these two deals more than others due to their collateral characteristics. Given Spain's current economic outlook, S&P believes that the two deals will face challenges in the near to medium term. S&P's credit review focused on various risks embedded in the two pools backing the deals. In particular, S&P is concerned about relatively high asset concentrations, both in the real estate and construction sector as well as in one single region. FTPYME Bancaja 3 and FTPYME Bancaja 6 assets are concentrated in the real estate and construction sectors—48.08% and 57.36%, respectively. Most of the loans were originated in the Valencia region, which is the originator's core business area (55.82% and 56.69%, respectively). Finally, S&P assessed the negative effect of loans granted to developers and obligor concentration. The latter could be more important for the FTPYME Bancaja 3 pool. As of the last investor report, the collateral comprises 830 loans and the top 10 borrowers represent 14.77% of the pool. The FTPYME Bancaja 6 pool comprises 2,260 loans and the top 10 lenders represent 8.76%. FTPYME Bancaja 3 S&P puts the results of its credit analysis into S&P's cash flow analysis, which showed that the junior notes in FTPYME Bancaja 3 cannot maintain their current ratings. The transaction benefits from high asset seasoning and a very low pool factor, only 19.8% of the closing balance. Nevertheless, the continuous deterioration in pool performance has substantially eroded the deal's excess spread in recent periods. As of February 2009, 90+ day arrears were 7.4% of the pool. Beyond the pool amortization effect, the increase in delinquency amount is still a relevant driver of the permanent of delinquency rate growth. 90+ day arrears grew to EUR12.5 million in February 2009 from EUR9.8 million in December 2008. Finally, the cash reserve was drawn on the March payment date because the fund had to amortize notes for EUR3.2 million of defaulted loans (loans in arrears for more than 12 months). The reserve fund is now at EUR4.8 million, versus the required level of EUR5.0 million. S&P concluded that the credit enhancement available to the class C and D notes in FTPYME Bancaja 3 was insufficient to maintain the current ratings. Consequently, S&P lowered its rating on the class C and D notes. S&P also kept the class A3(G) and B notes on CreditWatch negative because of their exposure to Bancaja as swap counterparty. FTPYME Bancaja 6 The results of S&P's credit and cash flow analysis showed that the credit enhancement available to the class B and C notes was insufficient to maintain the current ratings. Loans in arrears for more than 90 days account for 10.4% of the pool (as of the end of February), up by 591 basis points since September 2008. Due to the pool's characteristics, the effect of the economic slowdown is having a higher impact on this deal than the market average. FTPYME Bancaja 6 will start accruing written-off loans (i.e., loans in arrears for more than 18 months) from the next payment date (June). Interest deferral triggers are based on cumulative default and set at 3.75% for class C and 5.75% for class B. A breach of the trigger will potentially result in the junior and mezzanine notes experiencing an interest shortfall, while the senior notes will deleverage more quickly. Given the current transaction performance and S&P's expectation that a significant portion of current long-term arrears could roll into default, S&P believes that the likelihood of a breach of this trigger has increased. This negatively affected S&P's ratings on the junior tranches, but this feature of the structure is providing a good level of protection to the senior classes. As a result, S&P lowered its ratings on the class B and C notes and affirmed S&P's ratings on classes A2 and A3(G). Ratings List Ratings Lowered and Removed from Creditwatch Negative FTPYME Bancaja 3, Fondo de Titulizacion de Activos EUR900 Million Floating-Rate Notes Class To From ----- -- ---- C BBB BBB+/Watch Neg FTPYME Bancaja 6, Fondo de Titulizacion de Activos EUR1.028 Billion Floating-Rate Notes Class To From ----- -- ---- B BB BBB/Watch Neg Ratings Lowered FTPYME Bancaja 3, Fondo de Titulizacion de Activos EUR900 Million Floating-Rate Notes Class To From ----- -- ---- D BB- BB FTPYME Bancaja 6, Fondo de Titulizacion de Activos EUR1.028 Billion Floating-Rate Notes Class To From ----- -- ---- C B- B Ratings Kept on Creditwatch Negative FTPYME Bancaja 3, Fondo de Titulizacion de Activos EUR900 Million Floating-Rate Notes Class Rating ----- ------ A3(G) AAA/Watch Neg B AA-/Watch Neg Ratings Affirmed FTPYME Bancaja 6, Fondo de Titulizacion de Activos EUR1.028 Billion Floating-Rate Notes Class Rating ----- ------ A2 AAA A3(G) AAA D CCC- =========== S W E D E N =========== GENERAL MOTORS: Saab Eyes 20 Possible Buyers -------------------------------------------- Saab has started talks with around 20 different parties interested in acquiring the Company, Reuters reports, citing Guy Lofalk, a court-appointed administrator. According to Reuters, Mr. Lofalk said that Saab hopes to reach a deal by June 2009, shortly after its bankruptcy protection would end. Reuters relates that the court granted Saab an extension to its Chapter 11 bankruptcy protection. Reuters quoted a Swedish court official as saying, "The court has decided that the reconstruction can continue until May 20 at the latest, if no other decision is taken before then." None of Saab's creditors objected to its reorganization plan, which calls for the creditors to write-off 75% of its US$1.34 billion debt, of which GM owns over 90%, Reuters states. According to court documents, the debt deal will be completed in July 2009 and the first payments will be made a year later. Reuters says that Saab's plan will require an infusion of about US$1 billion to complete. Reuters states that about US$400 million will come from GM in the form of production equipment and debt write-offs, while Saab hopes to raise US$600 million from the European Investment Bank. Saab's Plan calls for the company to boost efficiency in its plants, dropping its break-even point to 130,000 vehicles per year from the current 150,000, Reuters reports. Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 266,000 people around the world and manufactures cars and trucks in 35 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. GM Europe is based in Zurich, Switzerland, while General Motors Latin America, Africa and Middle East is headquartered in Miramar, Florida. As reported in the Troubled Company Reporter on November 10, 2008, General Motors Corporation's balance sheet at September 30, 2008, showed total assets of US$110.425 billion, total liabilities of US$170.3 billion, resulting in a stockholders' deficit of US$59.9 billion. General Motors Corp. admitted in its viability plan submitted to the U.S. Treasury on February 17 that it considered bankruptcy scenarios, but ruled out the idea, citing that a Chapter 11 filing would result to plummeting sales, more loans required from the U.S. government, and the collapse of dealers and suppliers. A copy of GM's viability plan is available at: http://researcharchives.com/t/s?39a4 The U.S. Treasury and U.S. President Barack Obama's automotive task force are currently reviewing the Plan, which requires an additional US$16.6 billion on top of US$13.4 billion already loaned by the government to GM. As reported in the Troubled Company Reporter on November 11, 2008, Standard & Poor's Ratings Services lowered its ratings, including the corporate credit rating, on General Motors Corp. to 'CCC+' from 'B-' and removed them from CreditWatch, where they had been placed with negative implications on Oct. 9, 2008. S&P said that the outlook is negative. Fitch Ratings, as reported in the Troubled Company Reporter on November 11, 2008, placed the Issuer Default Rating of General Motors on Rating Watch Negative as a result of the company's rapidly diminishing liquidity position. Given the current liquidity level of US$16.2 billion and the pace of negative cash flows, Fitch expects that GM will require direct federal assistance over the next quarter and the forbearance of trade creditors in order to avoid default. With virtually no further access to external capital and little potential for material asset sales, cash holdings are expected to shortly reach minimum required operating levels. Fitch placed these on Rating Watch Negative: -- Senior secured at 'B/RR1'; -- Senior unsecured at 'CCC-/RR5'. As reported in the Troubled Company Reporter on June 24, 2008, DBRS has placed the ratings of General Motors Corp. and General Motors of Canada Limited Under Review with Negative Implications. The rating action reflects the structural deterioration of the company's operations in North America brought on by high oil prices and a slowing U.S. Economy. GENERAL MOTORS: Speeds Up Preparations for Possible Bankruptcy -------------------------------------------------------------- General Motors Corp. is speeding up preparations for a possible bankruptcy filing, Jeff Green at Bloomberg News reports, citing people familiar with the matter. According to Bloomberg, the sources said that preparations include creating a new company from GM's best assets if necessary, and looking at a 363 sale -- a reference to a section of the Chapter 11 bankruptcy code that would help form a new automaker from the assets and brands of GM to increase the Company's chances of survival. GM will meet with Treasury officials this week to review new restructuring proposals, Bloomberg states, citing a person familiar with the matter. Saab Eyes 20 Possible Buyers GM's Swedish unit, Saab Automobile, said in court documents that it has as many as 20 possible buyers. Saab has started talks with around 20 different parties interested in acquiring the Company, Reuters reports, citing Guy Lofalk, a court-appointed administrator. According to Reuters, Mr. Lofalk said that Saab hopes to reach a deal by June 2009, shortly after its bankruptcy protection would end. Reuters relates that the court granted Saab an extension to its Chapter 11 bankruptcy protection. Reuters quoted a Swedish court official as saying, "The court has decided that the reconstruction can continue until May 20 at the latest, if no other decision is taken before then." None of Saab's creditors objected to its reorganization plan, which calls for the creditors to write-off 75% of its US$1.34 billion debt, of which GM owns over 90%, Reuters states. According to court documents, the debt deal will be completed in July 2009 and the first payments will be made a year later. Reuters says that Saab's plan will require an infusion of about US$1 billion to complete. Reuters states that about US$400 million will come from GM in the form of production equipment and debt write-offs, while Saab hopes to raise US$600 million from the European Investment Bank. Saab's Plan calls for the company to boost efficiency in its plants, dropping its break-even point to 130,000 vehicles per year from the current 150,000, Reuters reports. Daewoo Posts KRW875.69 billion Net Loss in 2008 Dow Jones Newswires reports that GM's South Korean subsidiary, GM Daewoo Auto & Technology Co., posted a KRW875.69 billion net loss in 2008, compared to a net profit of KRW540.51 billion in 2007, due to low demand and investment losses. High oil prices in 2008 led to reduced sales of SUVs, while increasing manufacturing costs and volatile foreign exchange rates took their toll on profits, Dow Jones states, citing GM Daewoo's Vice President Jay Cooney. According to Dow Jones, GM Daewoo's operating profit dropped 39% to KRW290.31 billion in 2008, from KRW472.27 billion in 2007. Sales dropped 1.6% to KRW12.310 trillion from KRW12.514 trillion, Dow Jones says. GM Daewoo, Dow Jones relates, said that it may suffer liquidity problems in the second quarter 2009. It is negotiating with the Korean government to secure short-term financial support, according to Dow Jones. South African Arm To Cut 700 Jobs Dow Jones state that a spokesperson of GM's South African unit said that the firm will lay off about 700 employees, after market conditions deteriorated further in the early part of this year. Dow Jones quoted General Motors South Africa communications manager Denise van Huyssteen as saying, "We anticipate terminating the services of temporary contract employees, extending the voluntary separation plan to all employees and, as a last resort, implementing forced retrenchments." General Motors South Africa would proceed with lay offs after consulting with the industry union and other worker representatives, Dow Jones says, citing Mr. van Huyssteen. Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 266,000 people around the world and manufactures cars and trucks in 35 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. GM Europe is based in Zurich, Switzerland, while General Motors Latin America, Africa and Middle East is headquartered in Miramar, Florida. As reported in the Troubled Company Reporter on November 10, 2008, General Motors Corporation's balance sheet at September 30, 2008, showed total assets of US$110.425 billion, total liabilities of US$170.3 billion, resulting in a stockholders' deficit of US$59.9 billion. General Motors Corp. admitted in its viability plan submitted to the U.S. Treasury on February 17 that it considered bankruptcy scenarios, but ruled out the idea, citing that a Chapter 11 filing would result to plummeting sales, more loans required from the U.S. government, and the collapse of dealers and suppliers. A copy of GM's viability plan is available at: http://researcharchives.com/t/s?39a4 The U.S. Treasury and U.S. President Barack Obama's automotive task force are currently reviewing the Plan, which requires an additional US$16.6 billion on top of US$13.4 billion already loaned by the government to GM. As reported in the Troubled Company Reporter on November 11, 2008, Standard & Poor's Ratings Services lowered its ratings, including the corporate credit rating, on General Motors Corp. to 'CCC+' from 'B-' and removed them from CreditWatch, where they had been placed with negative implications on Oct. 9, 2008. S&P said that the outlook is negative. Fitch Ratings, as reported in the Troubled Company Reporter on November 11, 2008, placed the Issuer Default Rating of General Motors on Rating Watch Negative as a result of the company's rapidly diminishing liquidity position. Given the current liquidity level of US$16.2 billion and the pace of negative cash flows, Fitch expects that GM will require direct federal assistance over the next quarter and the forbearance of trade creditors in order to avoid default. With virtually no further access to external capital and little potential for material asset sales, cash holdings are expected to shortly reach minimum required operating levels. Fitch placed these on Rating Watch Negative: -- Senior secured at 'B/RR1'; -- Senior unsecured at 'CCC-/RR5'. As reported in the Troubled Company Reporter on June 24, 2008, DBRS has placed the ratings of General Motors Corp. and General Motors of Canada Limited Under Review with Negative Implications. The rating action reflects the structural deterioration of the company's operations in North America brought on by high oil prices and a slowing U.S. Economy. ===================== S W I T Z E R L A N D ===================== ALPENMETZGEREI JSC: Creditors Must File Claims by April 16 ---------------------------------------------------------- Creditors owed money by JSC Alpenmetzgerei are requested to file their proofs of claim by April 16, 2009, to: Christoph M. Pestalozz Schuetzengasse 1 8023 Zuerich Switzerland The company is currently undergoing liquidation in Zuerich. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on Feb. 12, 2009. ARTACHO TECHNICS: Deadline to File Proofs of Claim Set April 16 --------------------------------------------------------------- Creditors owed money by LLC Artacho Technics are requested to file their proofs of claim by April 16, 2009, to: Francisco Artacho Pfanne 4 5032 Rohr Switzerland The company is currently undergoing liquidation in Buchs. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on Feb. 20, 2009. AVALU JSC: Creditors Have Until April 16 to File Claims ------------------------------------------------------- Creditors owed money by JSC Avalu are requested to file their proofs of claim by April 16, 2009, to: Oliver M.P. Ehinger Zinnhagweg 16 4144 Arlesheim Switzerland The company is currently undergoing liquidation in Zuerich. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on Feb. 3, 2009. BINOMAR HOLDING: Proofs of Claim Filing Deadline is April 16 ------------------------------------------------------------ Creditors owed money by JSC Binomar Holding are requested to file their proofs of claim by April 16, 2009, to: Guido Banholzer JSC Orconsult Wengistrasse 7 Mail Box: 8026 Zuerich Switzerland The company is currently undergoing liquidation in Zuerich. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on Feb. 26, 2009. CHRIFRAG JSC: Creditors' Proofs of Claim Due by April 16 -------------------------------------------------------- Creditors owed money by JSC Chrifrag are requested to file their proofs of claim by April 16, 2009, to: Laurenzenvorstadt 79 5000 Aarau Switzerland The company is currently undergoing liquidation in Aarau. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on Aug. 26, 2008. COLLECTOR'S CORNER: April 16 Set as Deadline to File Claims ----------------------------------------------------------- Creditors owed money by JSC Collector’s Corner are requested to file their proofs of claim by April 16, 2009, to: Erich Bindschadler Sonnhalde 34 8602 Wangen Switzerland The company is currently undergoing liquidation in Zuerich. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on April 16, 2009. CRYSTAL CREDIT: Moody's Junks Rating on EUR63 Million Notes ----------------------------------------------------------- Moody's Investors Service has taken this rating action on notes issued by Crystal Credit Ltd: -- EUR108 Million Class 2005-A Principal at Risk Variable Rate Note due June 30 2012, Downgraded to Baa3 and Placed under Review for Possible Downgrade from Baa2, previously on 12 January 2006 Assigned Baa2. -- EUR81 million Class 2005-B Principal at Risk Variable Rate Notes due June 30, 2012 Downgraded to B1 and Placed under Review for possible Downgrade from Ba2, previously on 12 January 2006 Assigned Ba2. -- EUR63 million Class 2005-C Principal at Risk Variable Rate Notes due June 30, 2012 downgraded to Ca and Placed under Review for possible Downgrade from B2, previously on 12 January 2006 Assigned B2. The rating action has been prompted by the continued increase in the reported aggregate losses and provisions from the cedant insurers. In addition to the regular reporting from the transaction, Moody's has received confidential revised loss estimates from Swiss Re. Based on this information and Moody's opinion on wider macro economic issues, Moody's have revised Moody's loss projections for this transaction. Moody's revised projections now place the expected aggregate losses at approximately EUR700M for the underwriting years 2006, 2007 and 2008. This is greater than the attachment point of the Class C Notes (EUR666M) and as such, it is now expected that the Class C Notes will experience a loss of approximately 50%. The losses from underwriting year 2006 are now almost fully developed and provisioned for. However, losses from underwriting years 2007 and 2008 still could develop further and exhibit higher levels and a steeper trend resulting in a final aggregate projected loss ratio of 78%. This is significantly higher than the mean of 65% that Moody's initially assumed when the transaction was rated in January 2006. In the expected case projection, the Class C Note will experience a 50% loss. In addition, given the higher than initially assumed projected loss and remaining uncertainty around those levels, the expected loss on Class A and Class B Notes has increased resulting in the rating actions. In light of the remaining uncertainty around the evolution of the projected losses which have shown some volatility in the recent past, the ratings of the notes are on review for potential further downgrade. During the review process, Moody's will monitor the evolution of the loss ratio curves in conjunction with any further information from Swiss Re. If losses exceed current projections, or if future projections indicate a worsening trend, this could result in further rating pressure on the Notes. The transaction transfers credit risk on a mezzanine tranche of a pro-rata share of Swiss Re's trade credit re-insurance business (Swiss Re retains a 10% minimum share). The transaction is structured around the ratio of ceded losses to the gross premium received by Swiss Re from cedant insurers. The issuer will pay a protection amount to Swiss Re if the aggregate losses for underwriting years 2006, 2007 and 2008 exceed EUR666M. This protection amount will be drawn from the proceeds of the sale of the Notes which, otherwise will be repaid to Note holders at the transactions maturity. The various attachment points, as a ratio of claims and reserves to gross premium are: Class A: 90%, Class B: 81%, Class C: 74% EMME IMMO: Creditors Must File Proofs of Claim by April 16 ---------------------------------------------------------- Creditors owed money by JSC EMME Immo are requested to file their proofs of claim by April 16, 2009, to: Kurt Wyss-Tschopp Panoramastrasse 1 6103 Schwarzenberg Switzerland The company is currently undergoing liquidation in Malters. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on Feb. 24, 2009. SOGATRUST JSC: Deadline to File Proofs of Claim Set April 16 ------------------------------------------------------------ Creditors owed money by JSC ST SogaTrust are requested to file their proofs of claim by April 16, 2009, to: Dr. Herbert Schneider Dufourstrasse 121 9001 St. Gallen Switzerland The company is currently undergoing liquidation in St. Gallen. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on March 28, 2006. TELL MAKLER: Creditors Have Until April 16 to File Claims --------------------------------------------------------- Creditors owed money by JSC Tell Makler are requested to file their proofs of claim by April 16, 2009, to: JSC THV Ziegelrain 29 5001 Aarau Switzerland The company is currently undergoing liquidation in Mohlin. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on Dec. 2, 2008. TRAFICOMAR JSC: Proof of Claim Filing Deadline is April 16 ---------------------------------------------------------- Creditors owed money by JSC Traficomar are requested to file their proofs of claim by April 16, 2009, to: Trust Company Roesler Treuhand Brunnenstrasse 2 8610 Uster Switzerland The company is currently undergoing liquidation in Uster. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on Dec. 20, 2007. =========== T U R K E Y =========== ARCELIK AS: Fitch Downgrades Issuer Default Ratings to 'BB-' ------------------------------------------------------------ Fitch Ratings has downgraded Arcelik A.S.'s Long-term foreign and local currency Issuer Default Ratings to 'BB-' (BB minus) from 'BB', as well as downgrading its National Long-term rating to 'AA- (AA minus)(tur)' from 'AA(tur)'. The rating Outlooks are Negative. The downgrades reflect Fitch's increasingly negative view on global macroeconomic developments, as highlighted by the recent publication of the agency's global and east European GDP forecasts. The forecasts foresee a severe recession in 2009 followed by a modest recovery in 2010. With high leverage (5.1x at FY08), Arcelik is vulnerable to a further weakening of consumer confidence. While the company has announced two major fund- raising initiatives from its majority shareholder, Koc Holding, further de-leveraging is likely to present a challenge in view of the weakening outlook for household appliances in 2009 and possibly in 2010. As noted in a Fitch March 5, 2009 comment, Arcelik's FY08 results revealed some operating margin erosion despite reasonable top line growth. Higher-than-expected financial charges, driven by an increased cost of funding, materially eroded Arcelik's net profitability in FY08. The company has announced it will seek to raise TRY500 million in cash during H109 through a financial asset disposal and a rights issue, both of which will be backed by Koc Holding. Fitch has noted the board's recommendation not to pay dividends from 2008 earnings in 2009, and other initiatives intended to conserve cash. However, against the backdrop of a forecasted 3% contraction in Turkey's GDP in 2009 and economic downturns in most of Arcelik's export markets, free cash flow generation and de-leveraging is likely to be challenging in 2009 and 2010. At end FY08, the company reported net leverage of 5.1x (end-FY07: 4.2x) and a net fixed charge coverage of 1.4x (end-FY07: 1.9x). Arcelik had gross debt of TRY3.5 billion at end-FY08, of which more than half is due in H209 and FY10, imposing a relatively shorter refinancing cycle than that faced by its global peers. Fitch notes that half of Arcelik's revenues are denominated in foreign currency compared with only around 30% of gross debt. The Negative Outlook is based on Fitch's assessment of the continued expected macroeconomic weaknesses in Arcelik's core markets, namely Turkey and Europe. Fitch expects net leverage (net debt/EBITDA) to stay above 3x during 2009 and 2010. Fitch notes that the challenges facing Arcelik are also being endured by its peers. Whirlpool and Electrolux, both of which are rated 'BBB-' (BBB minus)/Negative, two of Arcelik's closest competitors on a global scale, also sustained profitability declines in 2008, primarily due to sharply lower demand. Arcelik is Turkey's largest household appliances manufacturer, with over a 50% domestic market share. It produced 10 million units of white goods and 2.8 million units of TV sets and reported TRY6.8 billion in consolidated sales in FY08. The company is 56%- owned by Koc Holding of Turkey, while 21% is quoted on the Istanbul Stock Exchange. ============= U K R A I N E ============= AGROBUSINESS-NV OJSC: Court Starts Bankruptcy Procedure ------------------------------------------------------- The Economic Court of Kharkov commenced bankruptcy supervision procedure on OJSC Agrobusiness-NV (EDRPOU 05491161). The Temporary Insolvency Manager is: V. Shuba Office 313 Kosmicheskaya St. 26 61145 Kharkov Ukraine The Court is located at: The Economic Court of Kharkov Svoboda Square 5 61022 Kharkov Ukraine The Debtor can be reached at: OJSC Agrobusiness-NV Zheleznodorozhnaya St. 1 Novaya Vodolaga Kharkov Ukraine DELTA WHOLESALE: Creditors Must File Claims by April 16 ------------------------------------------------------- Creditors of LLC Trading Enterprise Delta Wholesale Trade (EDRPOU 35760265) have until April 16, 2009, to submit proofs of claim to: Private Enterprise Linkrust Insolvency Manager Liatoshynsky St. 4A/289 03191 Kiev Ukraine The Economic Court of Kiev commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. 15/127-b. 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 Trading Enterprise Delta Wholesale Trade Ac. Bogomolets St. 6 01024 Kiev Ukraine DONETSK GRANITE: Creditors Must File Claims by April 16 ------------------------------------------------------- Creditors of OJSC Donetsk Granite (EDRPOU 00292250) have until April 16, 2009, to submit proofs of claim to: A. Bugara Insolvency Manager Postishev St. 135-33 83055 Donetsk Ukraine The Economic Court of Donetsk commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. 5/26. The Court is located at: The Economic Court of Donetsk Artem St. 157 Donetsk Ukraine The Debtor can be reached at: OJSC Donetsk Granite Pereyezdnaya St. 4 83058 Donetsk Ukraine KIRIT-2007 LLC: Creditors Must File Claims by April 16 ------------------------------------------------------ Creditors of LLC Kirit-2007 (EDRPOU 35408016) have until April 16, 2009, to submit proofs of claim to J. Shyndel, Insolvency Manager. The Economic Court of Kharkov commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. B-24/176-08. The Court is located at: The Economic Court of Kharkov Svoboda Square 5 61022 Kharkov Ukraine The Debtor can be reached at: LLC Kirit-2007 Krasnoarmeyskaya St. 17 Khroli 61000 Kharkov Ukraine KNIAGININ PLUS: Creditors Must File Claims by April 17 ------------------------------------------------------ Creditors of LLC Kniaginin Plus (EDRPOU 32076437) have until April 17, 2009, to submit proofs of claim to: V. Lovas Insolvency Manager Office 22 Hetman Mazepa St. 59 76000 Ivano-Frankovsk Ukraine The Economic Court of Ivano-Frankovsk commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. B-21/59. The Court is located at: The Economic Court of Ivano-Frankovsk Shevchenko St. 16 76000 Ivano-Frankovsk Ukraine The Debtor can be reached at: LLC Kniaginin Plus Polevaya St. 2 Ivano-Frankovsk Ukraine PRODUCT-LUX LLC: Creditors Must File Claims by April 16 ------------------------------------------------------- Creditors of LLC Product-Lux (EDRPOU 35574080) have until April 16, 2009, to submit proofs of claim to: Private Enterprise Linkrust Insolvency Manager Liatoshynsky St. 4A/289 03191 Kiev Ukraine The Economic Court of Kiev commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. 15/126-b. 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 Product-Lux Rybalskaya St. 13 01011 Kiev Ukraine RADIAL LLC: Court Starts Bankruptcy Supervision Procedure ---------------------------------------------------------- The Economic Court of Kharkov commenced bankruptcy supervision procedure on LLC Radial (EDRPOU 33481178). The Temporary Insolvency Manager is S. Korolev. The Court is located at: The Economic Court of Kharkov Svoboda square 5 61022 Kharkov Ukraine The Debtor can be reached at: LLC Radial Sportivnaya St. 136 Sanzhary Kharkov Ukraine ZLATODAR LLC: Creditors Must File Claims by April 16 ---------------------------------------------------- Creditors of LLC Zlatodar (EDRPOU 32837413) have until April 16, 2009, to submit proofs of claim to: V. Postolenko Insolvency Manager Office 97 Pushkin St. 67 Cherkassy Ukraine The Economic Court of Cherkassy commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. 10/4642. The Court is located at: The Economic Court of Cherkassy Shevchenko boulevard 307 18000 Cherkassy Ukraine The Debtor can be reached at: LLC Zlatodar Michurin St. 61 Dzendzelivka Mankovsky Cherkassy Ukraine =========================== U N I T E D K I N G D O M =========================== ARROW DISTRIBUTORS: Appoints Joint Administrators from KPMG ----------------------------------------------------------- Mark Jeremy Orton and Richard James Philpott of KPMG LLP were appointed joint administrators of Arrow Distributors Ltd. on March 18, 2009. The company can be reached through KPMG LLP at: 2 Cornwall Street Birmingham B3 2DL England BBL REALISATIONS: Taps Joint Administrators from Ernst & Young -------------------------------------------------------------- Ian Best and Tom Lukic of Ernst & Young LLP were appointed joint administrators of BBL Realisations (2009) Ltd. on March 20, 2009. The company can be reached at: Elmfield Road Morely Leeds West Yorkshire LS27 0NN England BERTRAM GROUP: Calls in Joint Administrators from Ernst & Young --------------------------------------------------------------- Ian Best and Tom Lukic of Ernst & Young LLP were appointed joint administrators of Bertram Group Ltd. on March 20, 2009. The company can be reached at: Bertram Group Ltd. No. 1 Broadlands Business Park Norwich NR7 0WF England BRADFORD AND BINGLEY: Fitch Affirms Individual Rating at 'F' ------------------------------------------------------------ Fitch Ratings has upgraded UK-based Bradford and Bingley's senior unsecured debt rating to 'AAA' from 'A-' (A minus), while affirming the bank's other ratings, including its Long-term Issuer Default Rating at 'A-' (A minus). The rating actions have no implication for B&B's 'AAA'-rated covered bonds. The upgrading of B&B's senior unsecured debt to 'AAA' follows the extension of a government guarantee on several of B&B's wholesale funding instruments, including senior notes, which existed at midnight on September 28, 2008. The guarantee, originally put in place on September 29, 2008, will expire when B&B has been completely wound down. Although the government guarantee is still subject to approval from the European Commission, Fitch believes B&B does not benefit from any form of competitive advantage as the bank is not going to write any new business and is focusing on winding down its business. Fitch therefore expects the European Commission's approval to be forthcoming. Fitch has also maintained B&B's subordinated debt rating at 'B' while maintaining the Rating Watch Negative, and affirmed the bank's perpetual preferred securities (hybrid capital) at 'C'. The ratings reflect the explicit exclusion of these instruments from the government guarantee. The RWN on the bank's subordinated debt reflects the risk of a potential deferral of interest and/or principal payments on this instrument. A government loan of GBP18bn ranks senior to subordinated debt and changes in for example, interest rates, loan defaults or house prices, could influence the amount of capital remaining before the last subordinated debt instrument matures in 2023. B&B may choose to defer payment of interest and/or principal on subordinated debt before repaying its debt to the government in full. Consequently, Fitch believes there is a risk that subordinated debt holders may not be repaid if B&B's credit losses stretch the bank's capital base. B&B's ratings are: -- Long-term IDR affirmed at 'A-' (A minus); Outlook Stable -- Short-term IDR affirmed at 'F1+' -- Individual Rating affirmed at 'F' -- Support Rating affirmed at '1' -- Support Rating Floor affirmed at 'A-' (A minus) -- Lower Tier 2 subordinated debt maintained at 'B'; Rating Watch Negative maintained -- Tier 1 securities affirmed at 'C' B&B was nationalized on September 29, 2008. Its savings book and branch network were subsequently sold to Banco Santander's UK subsidiary, Abbey National ('AA-' ((AA minus))/ Stable). The mortgage book, which consists mainly of self-originated and acquired specialist loans, and wholesale assets, remain in the bank. B&B has ceased any new lending and management is allowing the mortgage book to run off while seeking to protect asset quality. BTL REALISATIONS: Appoints Joint Administrators from Ernst & Young ------------------------------------------------------------------ Ian Best and Tom Lukic of Ernst & Young LLP were appointed joint administrators of BTL Realisations (2009) Ltd. on March 20, 2009. The company can be reached at: BTL Realisations (2009) Ltd. No. 1 Broadlands Business Park Norwich NR7 0WF England COCO FINANCE: Moody's Reviews Ba2-Rated Cl. E Notes for Downgrade ----------------------------------------------------------------- Moody's Investors Service has placed under review for possible downgrade its ratings of five classes of notes issued by CoCo Finance 2006-1 plc. The transaction is a replenishable synthetic Balance Sheet CDO referencing a EUR4.5 billion pool of bank originated corporate loans. The rating actions reflect the revision of certain key assumptions that the agency uses to rate and monitor corporate CDOs. These revised assumptions incorporate Moody's expectation that European and global corporate default rates are likely to greatly exceed their historical long-term averages and reflect the heightened interdependence of credit markets in the current global economic contraction. Specifically, the changes include: (1) a 30% increase in the assumed likelihood of default for corporate credits in CDOs (2) an increase in the degree to which ratings are adjusted according to other credit indicators such as rating Reviews and Outlooks and (3) an increase in the default correlation applied to corporate portfolios as generated through a combination of higher default rates and increased asset correlations. These revised assumptions are described in greater detail in the press release published on January 15, 2009. Moody's notes that the global corporate loan sector currently has a negative outlook and has shown signs of increasing weakness in terms of credit performance. The sector is further stressed by the anticipated limited refinancing opportunities for EMEA corporate issuers over the next six to twelve months. In addition, for the majority of the underlying referenced assets, the equivalent Moody's ratings used in Moody's analysis are obtained through a mapping process between the originator's internal rating scale and Moody's public rating scale. To compensate for the absence of credit indicators such as ratings reviews and outlooks in mapped ratings, a half notch stress was applied to the mapping scale. Because the mapping was performed prior to April 1, 2007, an additional stress was applied to capture potential deviations from the established mapping. Moody's initially analyzed and continues to monitor this transaction using primarily the methodology and its supplements for corporate synthetic CDOs as described in Moody's Special Reports and press releases below: -- Moody's Approach To Rating Corporate Collateralized Synthetic Obligations (March 2009) -- Framework for De-Linking Hedge Counterparty Risks from Global Structured Finance Cashflow Transactions (May 2007) -- Modeling Recovery Rates in European CDOs The rating actions are: Issuer name: CoCo Finance 2006-1 PLC -- EUR58,500,000 Class A Secured Floating Rate Notes due October 2016, Aaa and Placed Under Review for Possible Downgrade; previously on 5 July 2006 Assigned Aaa -- EUR72,000,000 Class B Secured Floating Rate Notes due October 2016, Aa2 and Placed Under Review for Possible Downgrade; previously on 5 July 2006 Assigned Aa2 -- EUR45,000,000 Class C Secured Floating Rate Notes due October 2016, A2 and Placed Under Review for Possible Downgrade; previously on 5 July 2006 Assigned A2 -- EUR40,500,000 Class D Secured Floating Rate Notes due October 2016, Baa2 and Placed Under Review for Possible Downgrade; previously on 5 July 2006 Assigned Baa2 -- EUR65,700,000 Class E Secured Floating Rate Notes due October 2016, Ba2 and Placed Under Review for Possible Downgrade; previously on 5 July 2006 Assigned Ba2 COLD-FORM LTD: Administrators Put Assets for Sale ------------------------------------------------- Cold-Form Ltd's joint administrators, Kim Rayment and Jo Wright of BDO Stoy Hayward, offer sale the company's business and assets. Key details of the assets for sale include: -- business established in 1932; -- supplies to a range of automotive suppliers and general engineering companies; -- circa 54,000 sq.ft. of Freehold state-of-the-art manufacturing premises and office space in Droitwich; and -- wide range of equipment and loyal multi-skilled workforce offering a versatile range of manufacturing solutions. For more information, contact: Simon Ling Tel: 0121 352 6265 Email: simon.ling@bdo.co.uk Webiste: www.bdo.co.uk CORASAIR NO 2: S&P Cuts Rating on A$5.5 Mil. Floating Notes to 'D' ------------------------------------------------------------------ Standard & Poor's Ratings Services lowered its rating on Series 87 A$5.5 million floating-rate secured callable portfolio credit- linked notes issued by Corsair (Jersey) No. 2 Ltd. to 'D' from 'CCC-/Watch Neg'. The downgrade reflects a loss incurred by the noteholders. The portfolio in the transaction had suffered several credit events, which resulted in an aggregate loss that exceeded the available subordination and reduced the principal amount of the notes. There has been an interest payment shortfall on the most recent interest payment date. The rating action on the affected transaction is: Rating lowered: Name Rating To Rating From ---- --------- ----------- Corsair (Jersey) No. 2 Ltd. D CCC-/Watch Neg Series 87 E & F JOINERY: Brings in Joint Administrators from Baker Tilly -------------------------------------------------------------- Susan Agnes Maund and Simon Peter Bower of Baker Tilly Restructuring and Recovery LLP were appointed joint administrators of E & F Joinery Ltd. on March 18, 2009. The company can be reached through Baker Tilly Restructuring and Recovery LLP at: International House Queens Road Brighton East Sussex BN1 3XE England FERONIA PLC: S&P Lowers Rating on Class E Notes to 'BB' ------------------------------------------------------- Standard & Poor's Rating Services lowered to 'BB' from 'BBB' its credit rating on the class E notes issued by Feronia (European Loan Conduit No. 11) PLC. The 'AAA' ratings on the class C and D notes are unaffected by this rating action. S&P has lowered the rating on the class E notes because, in S&P's view, the risk of a principal loss occurring has increased on the Salford Loan. The notes issued by Feronia were originally backed by 17 loans and secured by commercial real estate assets in the U.K. and one property in Gibraltar. Due to loan prepayments, two loans remain in the pool: the Melda Ventures loan and the Salford Development loan. The maturity date for both loans falls in July 2009 and the legal final maturity date of the notes falls in October 2011. The Melda Venture loan represents 26% of the loan pool; the current loan balance stands at GBP10 million. This is an interest-only loan secured on a multi-let office property in Gibraltar let to 50 tenants (representing a 98% occupancy rate). The reported net income has increased significantly since closing and is currently GBP3.5 million, bringing the current interest coverage ratio to 4.71x. The reported loan-to-value ratio is unchanged since closing at 57.14%, based on a valuation undertaken in 2002. S&P considers these to be strong credit metrics. The other loan, Salford Developments, is partially amortizing with a current outstanding balance of GBP28.5 million, and is due to amortize down to GBP28.1 million at loan maturity. This loan is secured by four interconnecting office properties located in Salford Quays, Greater Manchester. The properties are considered to be in a good location. The reported LTV ratio, based on a 2002 valuation, is 72.2% and at loan maturity is expected to be at 71.1% due to scheduled amortization. The reported net operating income is GBP3.07 million and the current ICR for this loan is 1.58x, above the covenanted level of 1.10x and cash trap of 1.25x. The current DSCR is 1.09x (there is no DSCR or LTV ratio covenant for this loan). Since closing, Salford Developments has been fully occupied and is currently primarily occupied by BUPA and Muse Developments (previously AMEC Properties), with Muse representing 71.5% of the total rental income. S&P has considered a range of scenarios, including a sale with vacant possession, and given the current credit environment S&P considers that the risk of a principal loss occurring under this loan has increased. The rating actions are taken in light of these factors. ITV PLC: In Talks With Investors Over Rights Issue -------------------------------------------------- Nic Fildes of the Telegraph reports that the board of directors of ITV plc will decide in the next two weeks whether to press ahead with a cash call to shore up its balance sheet. According to the report, ITV is in the final stages of sounding out institutional investors about a rights issue or placing that could raise several hundred million pounds to address its GBP730 million debt position and pension fund deficit of GBP178 million. The report relates UBS, which acts as joint housebroker for ITV, said last month that the company could look to raise up to GBP500 million through a fund-raising as an insurance policy against continued softness in the advertising market. The bank, the report disclosed, warned a further decline in the TV market of up to 10pc would leave the company with a substantial funding gap in 2011. About ITV plc ITV plc -- http://www.itvplc.com/-- is a United Kingdom-based advertising funded broadcaster. The Company also operates as an advertising funded media owner in the United Kingdom across all media, including television, radio, press, cinema, outdoor and the Internet. As a producer, ITV makes hours of network television. Its digital channels include ITV2, ITV3, ITV4 and Citv. ITV also makes programs for the BBC, Channel 4, five, Sky and other broadcasters. ITV produces programs watched on screens from San Francisco to Sydney. In addition, it produces a range of products related to ITV programs, such as digital video disks (DVDs) and computer games. Its online properties include itv.com, itvlocal.com and Friends Reunited. * * * As reported in the Troubled Company Reporter-Europe on March 9, 2009, Standard & Poor's Ratings Services lowered its long-term corporate credit and senior unsecured debt ratings on U.K. private TV broadcaster ITV PLC to 'BB-' from 'BB+'. The outlook is stable. Simultaneously, the ratings were removed from CreditWatch where they had been placed with negative implications on Jan. 27, 2009. At the same time, S&P affirmed its 'B' short-term corporate credit rating on ITV. The '4' recovery rating on all of ITV's outstanding bonds is unchanged. The '4' recovery rating indicates S&P's expectation of average (30%-50%) recovery for unsecured creditors in the event of a payment default. On March 9, 2009, the TCR-Europe reported that Moody's Investors Service downgraded ITV plc's senior unsecured ratings, Corporate Family Rating and Probability of Default rating, to Ba2 (from Ba1). The rating outlook for ITV is negative. LAZENBY METAL: Taps Joint Administrators from Deloitte & Touche --------------------------------------------------------------- Richard Michael Hawes and Dominic Lee Zoong of Deloitte & Touche LLP were appointed joint administrators of Lazenby Metal Services Ltd. on March 24, 2009. The company can be reached at: Lazenby Metal Services Ltd. 32/34 Calder Wharf Mill Huddersfield Road Ravensthorpe Dewsbury West Yorkshire WF13 3JW England MANN CONSTRUCTION: In Administration; Vantis Appointed ------------------------------------------------------ Mann Construction Limited, the Enfield-based civil engineering, groundwork and reinforced concrete provider, entered into administration on April 1, 2009. Jason Baker, Nick O'Reilly and Peter Hughes-Holland, Client Partners at Vantis Business Recovery Services (BRS), a division of Vantis, the UK accounting, tax and business advisory group, have been appointed Joint Administrators. Commenting on the case, Jason Baker said: "Unfortunately Mann Construction has suffered as a result of the recession in the construction sector. This led to severe cash flow problems, affecting the ability of the company to trade, which in turn affected the progress of work on clients' sites creating operational issues. "Intensive discussions were held with a management team with a view to acquiring the business and assets as a going concern, however, because of a high degree of uncertainty about the management team's ability to secure future contracts for work, they concluded they could not proceed with their proposed acquisition. Consequently, because of the funding deficit, we are unable to continue to trade the business. Regrettably, the business will cease to trade today and we will have to make all staff redundant. We will work hard to support staff in the processing of redundancy claims." ROBERT DYAS: Management Buyout Nears Completion ----------------------------------------------- The Times' Ian King reports that Robert Dyas said it was close to completing a management buyout to secure the future of its business. The Times relates the management team, led by managing director Steve Round and turnaround expert Ian Gray, said "The directors can confirm constructive talks have been ongoing with the company's bankers and as a result are close to completing an MBO ... to secure the future of the business. Lloyds Banking Group remain fully supportive. The company continues to trade profitably in the run-up to the Easter trading period and all the stores currently remain open." The deal, which will save about 1, 250 jobs, is expected to be completed before Easter, the Times notes. The Times discloses under the terms of the deal, Robert Dyas, which was acquired by Change Capital in December 2003 for GBP61 million, is expected to have an enterprise value of about GBP30 million. According to the report, Change Capital's stake in Robert Dyas will be wiped out and it has no ongoing involvement in the business, which operates 99 stores. The team, the Times says, will inject an undisclosed sum into the business, although Lloyds Banking Group and Allied Irish Bank, are effectively in control. According to Telegraph.co.uk, people close to the talks said on Saturday that unless a deal could be reached imminently, Robert Dyas's owners would have no choice but to place the company into administration. The Times recalls Roger Holmes, managing director of Change Capital, wrote to Eric Daniels, chief executive of Lloyds, on Friday accusing the banks of refusing to negotiate a debt restructuring during the past seven months. Change Capital, the Times recounts, had been trying to negotiate a debt-for-equity swap with the banks. Headquartered in Leatherhead, Surrey, Robert Dyas Holdings Ltd. -- http://www.robertdyas.co.uk-- is a housewares and hardware retailer. SHIRES LIMITED: Joint Administrators Put 2 Divisions for Sale ------------------------------------------------------------- Shires Limited's joint administrators, RH Kelly and JP Sumpton, offer for sale as a going concern the business and assets of the company's Lancashire and West Yorkshire divisions. Shaws of Darwen, the Darwen, Lancashire-based division, manufactures fine hand crafted fire clay sinks and architectural terracotra. Shires UK, the Bradford, West Yorkshire-based division, manufactures and distributes bathroom fittings and accessories. For further information, contact: Peter Batchelor Ernst & Young LLP I Bridgewater Place Water Lane Leeds LS11 5QR Tel: (0113) 298 2450 Fax: (0113) 298 2206 - or - Roland Barzegar Ernst & Young LLP I Bridgewater Place Water Lane Leeds LS11 5QR Tel: (0113) 298 2564 Fax: (0113) 298 2206 SIXTY UK: CVA Deal to Save 250 Jobs ------------------------------------ Marino Donati at Drapers reports that Sixty UK Ltd. is expected to exit administration next month after creditors and shareholders agreed, through a company voluntary arrangement, a new business model that will allow the business to continue to trade profitably. The CVA, the report says, will save around 250 jobs at Sixty UK. The report notes the company's store in Liverpool will close shorty as a result of the CVA. "The CVA will enable all trade creditors to be paid in full immediately and landlords have separately agreed differing terms going forward, with all rents being brought up to date. The business will be handed back to the directors while I, as supervisor, will oversee that the terms of the CVA are adhered to," the report quoted Peter Hollis, administrator and CVA supervisor, as saying. As reported in the Troubled Company Reporter-Europe on Oct. 3, 2008, Peter Hollis and Nick O' Reilly, Client Partners at Vantis Business Recovery Services, a division of Vantis, the UK accounting, tax and business advisory group, were appointed joint administrators to Sixty UK, the company trading the Miss Sixty and Energie fashion brands. The company trades from 12 high street stores and concessions in major department stores across the country. Its brands are also sold through many independent fashion outlets across the UK. URSUS 2: Fitch Cuts Rating on GBP27.2 Mil. Class F Notes to 'BB' ---------------------------------------------------------------- Fitch Ratings has affirmed and downgraded Ursus 2 (Octane) plc's commercial mortgage-backed notes, due December 2019: -- GBP161.6 million class A (XS0259730207): affirmed at 'AAA'; Outlook Stable -- GBP10,000 class X1 (XS0259730629): affirmed at 'AAA'; Outlook Stable -- GBP5,000 class X2: affirmed at 'AAA'; Outlook Stable -- GBP49.0 million class B (XS0259731270): downgraded to 'A+' from 'AA+'; Outlook Stable -- GBP49.0 million class C (XS0259731353): downgraded to 'A+' from 'AA'; Outlook Stable -- GBP27.2 million class D (XS0259731437): downgraded to 'A+' from 'AA-'(AA minus); Outlook Stable -- GBP27.2 million class E (XS0259731510): downgraded to 'BBB' from 'A+'; Outlook Stable -- GBP27.2 million class F (XS0259731783): downgraded to 'BB' from 'A'; Outlook Stable Fitch's rating action is driven by the decline in collateral value since closing, which has had an adverse impact on the transaction's creditworthiness. A revaluation of the portfolio in September 2008 showed a market value decline of 11.5% to GBP410.0 million from GBP463.0 million at closing. Consequently, the reported loan-to-value ratio had increased to 83.2% in February 2009 from 74.1% in August 2008. While Fitch's view of the credit strength of the tenant (Shell UK Limited) remains unchanged since closing, the agency estimates a Fitch LTV of 120.0%. However, this concern is mitigated by the scheduled amortization, which will reduce the reported LTV to 65.8% from 83.2% by loan maturity. However, based on current estimations of market yields, the exit Fitch LTV is approximately 96%. The loan features an LTV covenant set at 85.0%. Since the next portfolio valuation is not due until September 2010, a breach of the subject covenant is not likely in the near future. As a result of the first rental uplift under the lease agreement, due in November 2009, the reported forward-looking interest coverage ratio and debt service coverage ratios have increased to 1.23% and 1.04% from 1.19% and 1.01% respectively. Ursus 2 (Octane) is a securitization of a single GBP351.6 million fixed-rate commercial mortgage loan secured against 180 petrol filling stations located across England, Wales and Scotland. The properties, which are considered to be of an above-average quality and of strategic importance in the sector, are all occupied by Shell UK Limited under fully repairing and insuring leases expiring in November 29, 2019 (though with a mutual break option in December 2017). The tenant is an operating subsidiary in the UK of Royal Dutch Shell plc ('AA+'/'F1+'/Stable), and although its rental obligations are not guaranteed by its parent, they are of a high credit quality. Fitch will continue to monitor the performance of the transaction. VITALITY GROUP: Appoints Joint Administrators from MCR ------------------------------------------------------ Andrew Stoneman and Jason Godefroy of MCR were appointed joint administrators of Vitality Group Limited on March 25, 2009. The company is a wholesaler of pharmaceutical products. The company can be reached at: Vitality Group Limited Garman Road Tottenham London N17 0QN England WINDERMERE VIII: S&P Junks Rating on Class E Notes -------------------------------------------------- Standard & Poor's Ratings Services lowered its credit ratings on the class C, D, and E notes issued by Windermere VIII CMBS PLC due to increased concerns about the creditworthiness and maturity profile of the remaining loans in the pool. All classes of notes in this deal remain on CreditWatch negative. The notes are backed by six loans secured by commercial properties in the U.K. Of the loans, five are due to mature in the next two years. The Amadeus Portfolio loan (4.8% of current pool) is secured by three office properties in Nottingham, Middlesbrough, and Colindale (northwest London), and matures in April 2009. The reported loan balance is GBP30 million. The properties are of mediocre specification and occupy secondary locations. The occupancy rate is approximately 75% and most of the income is derived from short-term leases. The reported loan-to-value ratio is 83.4% based on a valuation from January 2006. The Monument loan (2.6%) is secured by a single office property in the City of London, and matures in April 2009. The reported loan balance is GBP16.2 million. The main tenant (Lloyds TSB PLC) accounts for almost 99% of income under a lease that expired in March 2009. S&P is informed that Lloyds remains in occupation and has paid rent up to June 2009, but there is no certainty that it will extend its lease. The reported LTV ratio is 78.9% based on a valuation from March 2006. The borrowers under the Amadeus Portfolio and Monument loans are reported to have advised the servicer that they will be unable to repay the loan at maturity. As a consequence, both of these loans have been transferred into special servicing. S&P is informed that the special servicer is in negotiations with both borrowers to determine the most appropriate course of action. In S&P's opinion, the reported LTV ratios for the Amadeus Portfolio and Monument loans are unlikely to reflect recent market value declines that have affected U.K. commercial property markets and S&P considers that the risk of principal losses has increased for both loans. Both loans could experience declines in income owing to the short-term nature of in-place income, which is likely to further exacerbate any deterioration in value. In addition, three other loans in the pool mature between April 2010 and April 2011. The Mid City Place loan (34.6%) is secured by a single office property in Midtown, London. The reported loan balance is GBP215 million. The property is multi-let and 100% occupied. The interest coverage ratio is 1.03x. The loan matures in April 2011 but is subject to a two-year extension option subject to various conditions being satisfied at the date of extension. These include the weighted-average unexpired lease term being at least 10 years and the income yield on debt being at least 8.5%. Currently, neither of these tests is satisfied. The reported LTV ratio is 66.2% based on a valuation from July 2007. The Government Income Portfolio loan (32.2%) is secured by a portfolio of office properties let predominantly to various government entities. The weighted-average unexpired lease term is approximately eight years. In S&P's opinion, the lease and tenant profile are positive factors. The loan matures in October 2010. The reported loan balance is GBP199.6 million. The reported LTV ratio is 72.6% based on a valuation from March 2006. The AMG Portfolio loan (25%) is a senior-ranking portion of a larger loan. The loan is secured by five office properties in the City of London. The properties are almost fully occupied. However, the weighted-average unexpired lease term is approximately 2.5 years. S&P does not believe that the short-term nature of the income is a positive factor. The reported loan balance is GBP154.9 million. The reported LTV ratio is 67.9% based on a valuation from March 2006. In S&P's opinion, the reported LTV ratios for the Mid City Place, Government Income Portfolio, and AMG Portfolio loans are unlikely to reflect recent market value declines that have affected U.K. commercial property markets and S&P considers that the risk of principal losses has increased for these loans. Ratings List Windermere VIII CMBS PLC GBP1,037.79 Million Commercial Mortgage-Backed Floating-Rate Notes Ratings Lowered and Kept on Creditwatch Negative Ratings ------- Class To From ----- -- ---- C BBB-/Watch Neg A/Watch Neg D B/Watch Neg BBB/Watch Neg E CCC/Watch Neg B-/Watch Neg YELL GROUP: Denies Debt Restructuring and Asset Sale Rumors ----------------------------------------------------------- Amanda Andrews at the Daily Telegraph reports that Yell Group plc has denied that it plans to carry out a debt restructuring, insisting it is highly cash generative. Yell sources, as cited by the report, said there were no plans to refinance or to appoint debt restructuring experts to look at its GBP4 billion debt burden. The company also dismissed speculation that it was considering selling one of its overseas businesses, the report discloses. The report relates reports over the weekend suggested that falling sales could lead to a breach of an earnings test due in six to nine months. The company, the report notes, is due to refinance its debt in April 2011. The report recalls in September, Yell suspended its dividend and renegotiated its bank covenants. NM Rothschild, the investment bank, arranged a reset of loan terms last year, the report recounts. Headquartered in Reading, England, Yell Group plc -- http://www.yellgroup.com/-- is an international directories business operating in the classified advertising market through printed, online, and phone media in the U.K. and the US. Yell also owns 100% of TPI (renamed "Yell Publicidad"), the largest publisher of yellow and white pages in Spain, with operations in certain countries in Latin America. Yell's revenue for the twelve months ended March 31, 2008 was GBP2,219 million and its Adjusted EBITDA was GBP738.9 million. * * * As reported in the Troubled Company Reporter-Europe on Feb. 10, 2009, Moody's Investors Service placed the ratings of Yell Group plc on review for possible downgrade. Ratings affected were the Ba3 Corporate Family Rating and the B1 Probability of Default Rating. The rating action reflected Moody's concerns with regard to the group's operating environment, which has been deteriorating sharply amid weakening macroeconomic conditions in each of its markets. * UK: 117 Profit Warnings Issued in First Quarter 2009, E&Y Says ---------------------------------------------------------------- Research released by Ernst & Young on Monday, April 6, revealed that UK plc issued 117 profit warnings in the first quarter of Q1 2009, as the impact of the credit crisis continues to bear down on cash-strapped companies. This is the highest first quarter figure since 2001 and the third quarter in a row that UK plc has issued more than 100 profit warnings, vividly demonstrating heightened distress in the UK economy. Keith McGregor, Restructuring partner at Ernst & Young said: "It is not just the number of warnings that concerns us: the tone of company statements has also darkened. The prospects for 2009 appear as uncertain and as gloomy as at any point in the crisis. Green shoots will find it hard to flourish in such stony ground; we still believe that the worst of the downturn for many companies is yet to come." The highest warning sectors were Support Services (22), Media (13), Industrial Engineering and Software & Computer Services with ten each and General Financial (9). This broad industry spectrum reflects the growth and spread of the credit crisis into a full-blown recession, now passing down the credit and supply chains from financial services to consumer services and manufacturing, accelerating as consumers retrench. Household Goods & Home Construction Overall, more than 60 per cent of the Household Goods & Home Construction sector has warned in the last 12 months, however all but one of the profit warnings from house builders came in the first six months of the period, whilst the vast majority of the household goods profit warnings were issued in the last six months. Andrew Wollaston, Restructuring partner at Ernst & Young said: "The high level of profit warnings and their distinctive pattern is due to the 'perfect sector storm'; first house builders, and then companies who would furnish and supply those homes, have suffered from falling sales amid a dearth of credit and consumer confidence." Mr. Wollaston continued: "The sector can expect little respite in 2009. Many house builders have adjusted their output, stock levels and balance sheet to the new market realities and should benefit from falling costs this year. However, we cannot rule out further adjustments and write-downs. The big unknowns remain -– how far house prices will fall, when lending will pick up and when, if ever, these variables recover to pre-crunch levels. On the expectation that the outlook for consumers will not improve in 2009, the prospects for household goods companies are also bleak, especially those supplying furnishings and consumer durables." Industrial Engineering The number of companies from the FTSE Industrial Engineering sector issuing profit warnings has risen dramatically in the last six months. The sector reported 19 profit warnings in the last two quarters, compared with just one in the preceding six months. A staggering 16 per cent of the sector warned in Q1 2009 alone, with just under a third of Industrial Engineering companies warning in the year-to-date. The increase in the level of profit warnings from Industrial Engineering companies is symptomatic of a rising level of distress in manufacturing as a whole. Profit warnings from FTSE Electronic and Electrical Equipment companies have almost doubled year on year, with 22% of the FTSE sector warning in the year to date. Meanwhile, almost half of Automobile and Parts companies have warned in the last year. The only bright spots appear to be in high-tech areas and less cyclical areas, for example Aerospace and Defence, a sector that has seen no profit warnings in well over a year. Mr. McGregor said: "Although some industrial engineering companies have reported a pick up in demand in recent weeks, the uncertainty surrounding the UK economy and ongoing funding restraints mean customers remain cautious and future levels of demand uncertain. Governments have promised some aid for specific areas of manufacturing both here and abroad. However, fiscal constraints will limit their ability to intervene. Most companies will have to use their own resources to adjust to new realities and broadening the customer base, communicating proactively with suppliers and managing cash tightly should be the main priorities." The first quarter of 2009 revealed the increasing breadth and depth of the current downturn and hinted at its difficult legacy. Mr. McGregor concluded: "The toxic mix of the continuing credit crunch, together with a global economic downturn, is exposing corporate frailties and accelerating cost cutting and retrenchment. Governments and central banks also have little room to manoeuvre in their fight against recession even before the impact of diminishing tax receipts truly hits home. It is an invidious position and one from which we can only imagine a slow, arduous, and not necessarily linear recovery." About Ernst & Young Ernst & Young LLP -- http://www.ey.com/-- provides assurance, tax, transaction and advisory services. * UK: Manufacturing Business Failures to Increase by 52% in 2009 ---------------------------------------------------------------- Business failures in the manufacturing sector are predicted to increase to 2,300 (one in 44 manufacturing businesses) according to the latest Manufacturing Industry Watch report by accountants and business advisors, BDO Stoy Hayward LLP. Driven by slowing domestic and export demand combined with the limited availability of credit, 2.3 per cent of all manufacturing business will be forced to leave the market by the end of 2009, the report says. This is up 52 per cent from the 1,500 failures (one in 68) seen in the sector in 2008. Despite the pessimistic outlook, manufacturing business failures are forecast to taper off in 2010 (although expected to still mirror this year's 2,300 figure). This is due to expectations of a weaker Stirling boosting exports in the medium term and leading to favourable exchange rates. This is set to help manufacturing firms more than those in other sectors, benefit increasingly from a global recovery. Kim Stubbs, business restructuring partner and manufacturing sector specialist at BDO Stoy Hayward LLP said: "The manufacturing industry has undergone a continuous decline over much of the last decade resulting in falling employment in the sector and elevated business failure rates. Sadly, the current economic climate will further accelerate this downward trend and lead to further consolidations in the British manufacturing sector." "While manufacturers are likely to benefit disproportionately from favorable exchange rates and a global recovery, they need to focus on the crucial steps to get through the economic crisis, including cost cutting wherever possible, managing inventory and retaining cash within the business." * More Creditors to Opt for Formal Pay Deals, LC Corporate Says --------------------------------------------------------------- According to LC Corporate Strategies, the turnaround arm of national corporate recovery firm Leonard Curtis, more creditors are willing to arrange formal time-to-pay deals, or to negotiate reduced amounts in full and final settlement of outstanding debt; as opposed to issuing legal proceedings that could result in a formal insolvency process, where the likelihood of a dividend to creditors is minimal. Commenting, Stephen Fern, Director at LC Corporate Strategies, said: "Managing cashflow is becoming increasingly difficult as customers seek increased credit terms, which cannot subsequently be passed on to suppliers, and securing additional funding remains a challenge in the current climate. If a company is struggling to satisfy creditor payment pressures and service their funding commitments, it's vital that they keep lines of communication with creditors and funders open and transparent. Ignoring the issues and severing lines of communication will have a negative impact on the ability to negotiate successfully with creditors. "Where a viable business exists, and a realistic and achievable future strategy requires the support of creditors through either a time to pay arrangement or a reduction in any outstanding debt due in full and final settlement of a liability, creditors are becoming increasingly responsive to such proposals. Behaving in a transparent, professional way with creditors; whether HM Revenue & Customs, a landlord or a critical supplier, is far more likely to result in a positive outcome for both parties." ********* 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 US$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 US$625 per half-year, delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are US$25 each. For subscription information, contact Christopher Beard at 240/629-3300. * * * End of Transmission * * *