TCREUR_Public/100902.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

          Thursday, September 2, 2010, Vol. 11, No. 173



ADAM OPEL: Sued Over Lifetime Guarantee Advertising Campaign
ARCANDOR AG: Administrator Rejects Borletti's Fresh Karstadt Offer
PARAGON AG: Completes Restructuring; Acquires Unit's Assets
TUI AG: Mulls Sale of Hapag-Lloyd Stake to Focus on Travel


ATLANTIC SUPERMARKETS: 1st Half Net Loss Widens to EUR72.7 Million


ANGLO IRISH: May Need Further State Aid of Up to EUR2.5 Billion
IRISH LIFE: First Half Losses Down by Over EUR40 Million
JACKIE SKELLY: Energie Shuts Down Greystones Gym
MCINERNEY HOLDINGS: Posts EUR10.9 Million Half-Year Pre-Tax Losses


SEVERSTAL OAO: Moody's Withdraws Ratings for Business Reasons


HQ BANK: Close to Finding Buyer, Liquidator Says


CITY.COM LTD: Supermarket Chain Not Affected by Bankruptcy

U N I T E D   K I N G D O M

CANDOVER INVESTMENTS: To Wind Up & Sell Remaining Portfolio
KEYDATA: Former Owner Offers GBP13MM Loan to Prop Up Lifemark
PEGASUS RENT: Company Records Missing; Company Secretary Jailed
PROMINENT CMBS: S&P Affirms Rating on Class E Notes at BB (sf)
VBA LTD: Has Pre-Pack Sale Deal With Elitemark


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ADAM OPEL: Sued Over Lifetime Guarantee Advertising Campaign
Nico Scmidt at The Wall Street Journal reports that Germany's
Center for Protection against Unfair Competition, or
Wettbewerbszentrale, is suing General Motors Co.'s Adam Opel GmbH
division for an advertising campaign claiming to offer a lifetime
guarantee on Opel cars.

The Journal relates at the beginning of August, Opel introduced a
lifetime warranty for new cars with a limit of 160,000 kilometers
but no time restrictions.  It included key components such as the
engine, gearbox, electronics or the steering system while
excluding parts subject to regular wear and tear such as the drive
belt and oil filters, the Journal discloses.

According to the Journal, at the time, the Wettbewerbzentrale said
a customer would expect a "lifetime" guarantee to last for as long
as the customer drives it, or is able to drive, and not be based
on the vehicle's service life.  Opel was given until Aug. 19 to
pull the advertisement, which appeared in print and on the
Internet, but it didn't comply, the Journal discloses.

The Journal relates a Wettbewerbszentrale spokeswoman said talks
with Opel on the matter were recently concluded but the parties
failed to come to an agreement.

An Opel spokesman said the company continues to stand behind the
advertising campaign, the report notes.

Adam Opel GmbH -- is General Motors
Corp.'s German wholly owned subsidiary.  Opel started making cars
in 1899.  Opel makes passenger cars (including the Astra, Corsa,
and Vectra) and light commercial vehicles (Combo and Movano).  Its
high-performance VXR range includes souped-up versions of Opel
models like the Meriva minivan, the Corsa hatchback, and the Astra
sports compact.  Opel is GM's largest subsidiary outside North

                           *     *     *

As reported by the Troubled Company Reporter-Europe, Bloomberg
News said GM decided in June this year to fund Opel's EUR3.3
billion (US$4.3 billion) restructuring, after failing to secure
aid from European countries.  As reported by the Troubled Company
Reporter-Europe on June 11, 2010, Bloomberg News said Germany
turned down GM's request for EUR1.1 billion (US$1.3 billion) in
aid for its money-losing Opel division, forcing the automaker to
seek new ways to reorganize the unit.  Bloomberg disclosed Opel
sought EUR333 million in guarantees from the U.K., EUR437 million
from Austria and Spain combined and EUR50 million in project
financing from Poland.  Bloomberg said the Opel-Vauxhall
reorganization program includes eliminating 8,300 jobs from a
European workforce of 48,000 employees.

ARCANDOR AG: Administrator Rejects Borletti's Fresh Karstadt Offer
Karstadt Warenhaus GmbH's insolvency administrator Klaus Hubert
Goerg said in an e-mailed statement that he has rejected a renewed
offer by Maurizio Borletti's bidding group for Arcandor AG's
insolvent German department store chain, Natalie Weeks at
Bloomberg News reports.

As reported by the Troubled Company Reporter-Europe on Aug. 31,
2010, Bloomberg News, citing German newspaper Bild, said that
investor Nicolas Berggruen is "confident" that the Highstreet
partnership, the biggest landlord for Karstadt, will agree to
lower rents for the retailer.  Bloomberg disclosed the newspaper
reported that a decision by Highstreet, majority-owned by Goldman
Sachs Group Inc., is expected today, Sept. 2.

On Aug. 9, 2010, the Troubled Company Reporter-Europe, citing
Bloomberg News, reported that Karstadt's creditor committee on
Aug. 5 rejected opening talks with Borletti on selling Karstadt.
Mr. Schulz said in an interview the committee considered
Mr. Borletti's request and "concluded there's no sense in parallel
negotiations" with him while talks are under way with potential
buyer Berggruen Holdings Ltd.

As reported by the Troubled Company Reporter-Europe on Aug. 4,
2010 Bloomberg News said Mr. Borletti made an approach for
Karstadt.  Bloomberg disclosed Mr. Borletti on Aug. 2 said that he
submitted the offer, worth EUR100 million (US$131.8 million) on
July 29 to administrator Klaus Hubert Goerg.  Bloomberg noted
Mr. Borletti said he would like his offer to be considered if
Berggruen fails, as a "breakup is no alternative."  The Italian
entrepreneur, as cited by Bloomberg, said he won't take any money
out of Karstadt within the next five years.

                        About Arcandor AG

Germany-based Arcandor AG (FRA:ARO) --
formerly KarstadtQuelle AG, is a tourism and retail group.  Its
three core business areas are tourism, mail order services and
department store retail.  The Company's business areas are covered
by its three operating segments: Thomas Cook, Primondo and
Karstadt.  Thomas Cook Group plc is a tour operator with
operations in Europe and North America, set up as a result of a
merger between MyTravel and Thomas Cook AG.  It also operates the
e-commerce platform, Thomas Cook, supporting travel services.
Primondo has a portfolio of European universal and specialty mail
order companies, including the core brand Quelle.  Karstadt
operates a range of department stores, such as cosmopolitan
stores, including KaDeWe (Kaufhaus des Westens), Karstadt
Oberpollinger and Alsterhaus; Karstadt brand department stores;
Karstadt sports department stores, offering sports goods in a
variety of retail outlets, and a portal, that offers
online shopping, among others.

As reported by the Troubled Company Reporter-Europe, a local court
in Essen formally opened insolvency proceedings for Arcandor on
September 1, 2009.  The proceedings started for the Arcandor
holding company and for 14 units, including the Karstadt
department-store chain and Primondo mail-order division.  Arcandor
filed for bankruptcy protection after the German government turned
down its request for loan guarantees.  On June 8, 2009, the
government rejected two applications for help by the company,
which employs 43,000 people.  The retailer sought loan guarantees
of EUR650 million (US$904 million) from Germany's Economy Fund
program.  It also sought a further EUR437 million from a state-
owned bank.

PARAGON AG: Completes Restructuring; Acquires Unit's Assets
paragon AG has completed its restructuring just three months after
successfully emerging from insolvency.  The listed company will
acquire the assets of its former subsidiary paragon finesse GmbH
on September 1, 2010, ensuring continuity for both customers and
employees.  Headquartered in Delbrueck (North Rhine-Westphalia),
the company also has branches in Suhl (Thuringia), Nuremberg
(Bavaria), and St. Georgen (Baden-Wrttemberg).

The former paragon Group was dissolved on January 1, 2010 when
insolvency proceedings opened.  On June 1, 2010, the former parent
company paragon AG began operating fully independently again,
following a vote in favor of this at the creditors' meeting on
April 16, 2010.  A direct supplier to the automotive industry,
paragon AG now has excellent future prospects -- thanks to well-
established products, significantly less debt, and ultramodern
production equipment.

Whereas a number of inactive subsidiaries were wound up, parts of
paragon finesse GmbH's business will continue.  This company
operates at the Nuremberg and St. Georgen sites and is responsible
for the media interfaces and cockpit product groups.  paragon AG
and the insolvency administrator of paragon finesse GmbH have
reached agreement about acquiring the subsidiary's assets with
effect from September 1, 2010.

paragon AG is acquiring the assets at the development site in
Nuremberg, which will be run as a branch of paragon AG in the
future.  All employees in Nuremberg will be taken on by paragon
AG.  The St. Georgen site will also be retained.  The assets of
the stepper motors business will be acquired by paragon AG and
also run as one of its branches.  In the future, paragon AG's
production of instrumentation will be concentrated in Suhl; the
affected employees are being offered jobs in Suhl.

The parties to the deal have agreed not to disclose the purchase
price, which paragon can pay out of its cash flow due to its
strong performance.  As a result of acquiring the assets of
paragon finesse GmbH, paragon AG's workforce will increase from
279 (including 27 contract workers) to 357 (including 40 contract

"This redistribution ensures we have a very lean structure, short
decision-making channels, and fast response times," emphasizes CEO
Klaus Dieter Frers.  Besides the central business units, which
include marketing & sales, Delbrueck is home to the research &
development unit for the air quality, drive systems, and acoustics
product groups.  Sensor elements, electronics, and instrumentation
are manufactured in Suhl.  Nuremberg is responsible for the
research & development of the media interfaces and cockpit product
groups, while St. Georgen takes care of the research, development,
and production of stepper motors.

paragon AG is a direct supplier to the automotive industry and is
listed on the Deutsche Boerse Prime Standard index in
Frankfurt/Main, Germany.  The Company develops, manufactures, and
markets innovative solutions in its Automotive (Sensors/Actuators
and Cockpit Systems) and Electronic Solutions divisions.  Its
product portfolio includes the world's leading AQS air quality
sensor by far as well as hands-free speaking equipment and
instrumentation systems.  In addition to its headquarters in
Delbrueck, North Rhine-Westphalia, paragon also operates locations
in Suhl, Thuringia; St. Georgen, Baden-Wuerttemberg; Nuremberg,
Bavaria; and Heidenheim, Baden-Wuerttemberg.  In fiscal 2007, the
paragon Group generated sales totaling EUR108.9 million with a
workforce of 594 employees.

TUI AG: Mulls Sale of Hapag-Lloyd Stake to Focus on Travel
Tony Czuczka and Julie Cruz at Bloomberg News, citing the
Financial Times Deutschland, report that TUI AG is weighing
selling its share in the Hapag-Lloyd shipping company as TUI seeks
to focus on travel.

As reported by the Troubled Company Reporter-Europe on Aug. 26,
2010, Bloomberg News, citing Financial Times Deutschland, reported
that Hapag-Lloyd AG, the shipping company of which TUI owns about
43%, was considering returning state loan guarantees.

As reported by the Troubled Company Reporter-Europe on Oct. 6,
2009, Bloomberg News said that the German government approved
Hapag-Lloyd's application for EUR1.2 billion in loan guarantees.
Bloomberg disclosed Chancellor Angela Merkel's government agreed
to share 90% of the guarantee costs with the Hamburg city

On July 21, 2009, the Troubled Company Reporter-Europe, citing the
Financial Times, reported that Hapag-Lloyd was one of many
container lines worldwide struggling to cope with a slump in the
sector brought on by an oversupply of ships and rapid falls in
movements of the manufactured goods on which the trade depends.

TUI AG -- is a Germany-based
company mainly engaged in the tourism sector, focusing on the
markets of Central, Northern and Western Europe.  TUI owns a
network of travel agencies and tour operators, including air
tours, Thomson, First Choice and TUI Deutschland.  It also
operates several airlines, including Corsairfly, Thomsonfly and
First Choice Airways, among others.  The Company is structured
into three segments: TUI Travel, TUI Hotels and Resorts, and
Cruises.  TUI Travel comprises the Company's distribution, tour
operating, airline and incoming activities and services over 30
million customers in 180 countries.  The TUI Hotels and Resorts
division offers a portfolio of 238 hotels, located in Spain,
Greece, Egypt, France, Turkey, Tunisia, the Balearics and the
Caribbean, among others.  The Cruises sector comprises Hapag-Lloyd
Kreuzfahrten GmbH and TUI Cruises which provide luxury cruises,
and cruises within the German-speaking countries, respectively.

                           *     *     *

As reported by the Troubled Company Reporter-Europe on Aug. 3,
2010, Standard & Poor's Ratings Services said that it affirmed its
'B-' long-term corporate credit rating on Germany-based tourism
and shipping conglomerate TUI AG and removed it from CreditWatch,
where it was originally placed with negative implications on
July 29, 2009.  S&P said the outlook is negative.  At the same
time, the issue ratings of 'CCC+' on the senior unsecured debt,
and of 'CCC-' on the junior subordinated debt, were affirmed and
removed from CreditWatch negative.


ATLANTIC SUPERMARKETS: 1st Half Net Loss Widens to EUR72.7 Million
Natalie Weeks at Bloomberg News reports that Atlantic Supermarkets
SA incurred a wider first-half net loss and is reorganizing its

The company posted a EUR72.7 million (US$93 million) net loss in
the six months ended June 30, compared with a EUR1.9 million loss
in the year-earlier period, Bloomberg says, citing an Athens
bourse filing.  Sales dropped to EUR193.2 million, from EUR277.2
million, Bloomberg discloses.

Bloomberg relates Atlantic Supermarkets said in a separate bourse
filing on Tuesday that the company is selling outlets that don't
"contribute to its strategic goals," thus simultaneously boosting

As reported by the Troubled Company Reporter-Europe on July 19,
2010, Bloomberg News said Atlantic Supermarkets filed for
protection from its creditors after being hurt by reduced
household spending during the country's first recession since
1993.  Bloomberg disclosed the case was filed with the Athens
court of first instance.

Based in Athens, Greece, Atlantic Supermarkets SA is a grocery


ANGLO IRISH: May Need Further State Aid of Up to EUR2.5 Billion
John Murray Brown at The Financial Times reports that Anglo Irish
Bank chief executive Mike Aynsley said that the bank could require
further state aid of EUR1.5 billion-EUR2.5 billion.

This is on top of the EUR22.9 billion (US$29 billion) already
received to maintain minimum capital buffers as the bank absorbs
losses on the property loans transferred to the National Asset
Management Agency under the government's bank rescue plan, the FT

According to the FT, Mr. Aynsley said the precise figure would
depend on the loan discounts, or haircuts, applied by Nama on the
remaining loan portfolio.

The FT relates on Tuesday Dublin submitted final details to the
European Commission of its two options for Anglo Irish -- an
orderly winding down of the bank, or a management plan to retain
20% of the bank as a going concern.

Brian Lenihan, the finance minister, as cited by the FT, said the
government's preferred option was the one that entailed least cost
for the taxpayer.  The FT notes Mr. Lenihan said he expected a
decision from the Commission on Anglo Irish's restructuring plan
"in a matter of weeks".


According to the FT, Anglo Irish reported first-half losses of
EUR8.2 billion in the six months to June 30, compared with losses
of EUR12.7 billion in the 15 months to December 31.  The losses
include EUR3.5 billion on the transfer of EUR10 billion to Nama, a
EUR2.3 billion provision on the loan portfolio still to go to Nama
and EUR2.5 billion provided against the remaining book, the FT

The FT relates Mr. Aynsley said the second-half losses could be
EUR6 billion-EUR7 billion, as the remaining assets were
transferred to Nama.

Anglo Irish Bank Corp PLC --
operates in three core areas: business lending, treasury and
private banking.  The Bank's non-retail business is made up of
more than 11,000 commercial depositors spanning commercial
entities, charities, public sector bodies, pension funds, credit
unions and other non-bank financial institutions.  The Company's
retail deposits comprise demand, notice and fixed term deposit
accounts from personal savers with maturities of up to two years.
Non-retail deposits are sourced from commercial entities,
charities, public sector bodies, pension funds, credit unions and
other non-bank financial institutions.  In addition, at September
30, 2008, its non-retail deposits included deposits from Irish
Life Assurance plc.  The Private Bank offers tailored products and
solutions for high net worth clients and operates the Bank's
lending business in Ireland and the United Kingdom.

                           *     *     *

As reported by the Troubled Company Reporter-Europe on July 23,
2010, the A3/P-1 bank deposit and senior debt ratings as well as
the Ba1 dated subordinated debt rating and the Caa2 undated
subordinated debt rating of Anglo Irish Bank have been maintained
under review for possible downgrade as the key rating driver in
Moody's Investors Service's view remains the bank's restructuring
plan that is currently waiting EU approval.  Moody's said the
outlook on the bank's E BFSR, mapping to a Caa1 on the long-term
scale, is stable.

On April 7, 2010, the Troubled Company Reporter-Europe reported
that Fitch Ratings affirmed Anglo Irish Bank Corporation's lower
Tier 2 subordinated debt downgraded to 'CCC' from 'BBB+'.  Fitch
affirmed the rating on the bank's Upper Tier 2 subordinated notes
at 'CC'.  It also affirmed the rating on the bank's Tier 1 notes
at 'C'.

IRISH LIFE: First Half Losses Down by Over EUR40 Million
Geoff Percival at Irish Examiner reports that Irish Life &
Permanent managed to cut its first half losses by over EUR40
million to EUR10 million.

According to the report, overall, the 80% fall in IL&P's first
half operating loss -- from EUR51 million to EUR10 million -- was
boosted by recovery in the life assurance business, which saw a
40% year-on-year increase in operating profit to EUR118 million.
On a pre-tax basis, IL&P's group loss fell from EUR220 million to
EUR32 million, the report discloses.

The report notes the group's retail banking arm -- Permanent TSB
-- continued to make heavy losses (albeit marginally down, on a
year-on-year basis) and the level of arrears amongst its mortgage
customers increased by 28%, on a like-for-like basis, during the
first six months of the year.

Permanent TSB made an operating loss of EUR131 million, compared
with last year's first half loss of EUR132 million, the report
states.  The report relates Group chief executive Kevin Murphy
said the Permanent TSB arm will make further losses in the second

Mr. Murphy added that 80% of IL&P's 2010 refinancing round is
complete and that another EUR1.3 billion to EUR2.8 billion will be
raised, the report notes.

Headquartered in Dublin, Irish Life & Permanent plc -- is a provider of personal
financial services to the Irish market.  Its business segments
include banking, which provides retail banking services; insurance
and investment, which includes individual and group life assurance
and investment contracts, pensions and annuity business written in
Irish Life Assurance plc and Irish Life International, and the
investment management business written in Irish Life Investment
Managers Limited; general insurance, which includes property and
casualty insurance carried out through its associate, Allianz-
Irish Life Holdings plc, and other, which includes a number of
small business units.  On June 30, 2008, it acquired the rest of
the 50% interest in Joint Mortgage Holdings No. 1 Limited (the
parent of Springboard Mortgages Limited), resulting in Springboard
Mortgages becoming a wholly owned subsidiary.  On December 23,
2008, it acquired an additional 23% of Cornmarket Group Financial
Services Ltd, bringing its interest to 98%.

                           *     *     *

As reported by the Troubled Company Reporter-Europe on April 8,
2010, Fitch Ratings downgraded Irish Life & Permanent's Individual
rating to 'D' from 'C'.  Fitch said the downgrade reflects Fitch's
concerns about ILP's profitability in the next two years, its
ability to absorb increased provisioning charges in the banking
business through operating profits, the standalone capital
position of the bank and its large share of wholesale funding.
According to Fitch, while the insurance business, Irish Life,
continues to be profitable at an operating level, its
profitability was not sufficient to compensate for losses in the
banking business, permanent tsb, in 2009.

IL&P continues to carry Moody's Investors Servie's standalone Bank
Financial Strength Rating of D, which maps to Ba2 on the long term
rating scale.  IL&P's also carries an undated subordinated debt
rating of Ba3 from the rating agency.

JACKIE SKELLY: Energie Shuts Down Greystones Gym
Ciaran Hancock at The Irish Times reports that UK fitness group
Energie decided to close the former Jackie Skelly gym in
Greystones, Co Wicklow.

"Unfortunately, no suitable agreement could be reached with the
landlord of the Greystones club which would ensure the club could
remain in operation," The Irish Times quoted Energie as saying.

Energie bought the nine other Jackie Skelly gyms out of
examinership in May, securing 200 jobs, and said it would spend
EUR1.8 million on upgrading the chain, The Irish Times discloses.

As reported by the Troubled Company Reporter-Europe on May 25,
2010, Jackie Skelly Fitness entered the Examinership process in
February.  The proposal by energie, approved by the Court on
May 21, includes the restructuring of the business's balance

On April 20, 2010, the Troubled Company Reporter-Europe, citing
the Sunday Business Post Online, reported that the company has
debts of EUR12 million, most of which is owed to Ulster Bank.  The
Sunday Business Post disclosed the firm said in its application
for examinership that it had experienced problems in regard to its
rents, which were subject to upward only reviews.

Founded 17 years ago, Jackie Skelly Fitness is a gym chain
formerly owned by Jackie Skelly.

MCINERNEY HOLDINGS: Posts EUR10.9 Million Half-Year Pre-Tax Losses
Stephen Rogers at Irish Examiner reports that McInerney Holdings
posted half-year pre-tax losses of EUR10.9 million.

According to report, the group said it now has negative net assets
of EUR112.6 million and is not in compliance with its principal
banking covenants.

The report relates it confirmed that in March it enlisted the
services of Goldman Sachs and began looking for potential equity
partners and identified a leading international investor, US
company Oaktree, willing to put money into the company provided
appropriate revised financing arrangements could be secured.

The report notes the company said that while progress had been
made in its British operations, the same could not be said of
Ireland where, with its lenders withdrawing support, it was forced
to seek examinership.

"The loss of the support of the syndicate lenders in Ireland was
unexpected and caused us to seek court protection for that
business," the report quoted McInerney Chairman Ned Sullivan as
saying.  "However, progress has been made on the restructuring.
The directors believe that a restructuring and recapitalization
should ensure the best recovery for all stakeholders."

McInerney Holdings plc -- is a
home builder and regional home builder in the North and Midlands
of England.  It also undertakes commercial and leisure projects in
Ireland, United Kingdom and Spain.  It operates in Ireland, the
United Kingdom and Spain.  The main trading activities of the
Company's Irish home building business during the year ended
December 31, 2008 consisted of construction of private houses,
trading in developed sites and land, development of residential
land for third-parties and in joint-ventures, and contracting for
third-parties.  The Company's commercial property development
division, Hillview Developments Ltd (Hillview), develops
industrial units in the Greater Dublin area.  Hillview completed
1,223 square meters of industrial units as of December 31, 2008.
Its Spanish division, Alanda Group, is developing freehold
apartment schemes.  As of December 31, 2008, the Company completed
1,359 private and contracting residential units in Ireland, the
United Kingdom and Spain.


SEVERSTAL OAO: Moody's Withdraws Ratings for Business Reasons
Moody's Investors Service has withdrawn Severstal OAO's credit

The rating is withdrawn upon the company's request, which
qualifies under Moody's Guidelines for the Withdrawal of Ratings
in situations associated with "Business Reasons".

                        Ratings Rationale

Moody's has withdrawn the credit rating for its own business

Corporate Family Rating, Withdrawn, previously rated B3, negative

The last rating action was on June, 17, 2010 when Moody's
downgraded the corporate family rating from B1 to B3, the outlook
was moved to negative.  The rating action was triggered by the
unfavorable performance of the company in 2009, the continuation
in 2010 of a challenging environment and the uncertainties
associated with its future capital structure as the company is
currently being held by its minority owner Severstal (Ba3,
negative) as an assets for sale with possible disposal over the
next few quarters.  On June 30, 2010 Severstal sold 50.8% of
Lucchini to a company controlled by Alexey Mordashov, the owner of
Severstal, for a consideration of one euro.  This transaction
provided additional flexibility for the Lucchini S.p.A. sale
process and for the negotiation of amendments to the terms of
Lucchini's credit agreements.

Lucchini is Italy's second largest steel producer with an output
in 2009 of 1.6 million tons of steel down from 2.7 mt in 2008
including of 1.3 million tones of long and rolled products
(FYE08:2.1mt).  The company is one of the largest European
producers of special quality long products by volume of production
and has several plants and service centers throughout Europe,
primarily in Italy and France.

For the year ending December 31, 2009, the company's revenues and
Gross Margin from Operation (EBITDA) were EUR1.3 billion and
negative EUR140 million, respectively.

Severstal controls at this time 49.2% of Lucchini's shares.

Moody's Investors Service adopts all necessary measures so that
the information it uses in assigning a credit rating is of
sufficient quality and from reliable sources; however, Moody's
Investors Service does not and cannot in every instance
independently verify, audit or validate information received in
the rating process.


HQ BANK: Close to Finding Buyer, Liquidator Says
HQ Bank is close to finding a buyer, Kim McLaughlin at Bloomberg
News reports, citing the lender's liquidator, Bjoern Riese.

On Sept. 1, 2010, the Troubled Company Reporter-Europe, citing
Bloomberg News, reported that Mr. Riese, who was appointed as
liquidator of HQ Bank by a Swedish court on Aug. 30, said HQ's
banking operation may be sold after its license was revoked.
Bloomberg noted spokesman Andreas Koch said in an interview that
Carnegie Investment Bank AB may be interested in buying the bank's
assets.  HQ Bank was closed on Aug. 30 to give Mr. Riese time to
assess the situation, after the liquidation request submitted by
the regulator to Stockholm District Court made him acting chief
executive officer and chairman of the bank, according to

As reported by the Troubled Company Reporter-Europe on Aug. 31,
2010, Bloomberg News said Sweden's Financial Supervisory Authority
on Aug. 28 revoked HQ Bank's license to operate and applied for
its liquidation, saying the company broke regulations.  "HQ Bank
has demonstrated serious deficiencies in its trading operations,"
Bloomberg quoted the FSA as saying in a statement on its Web site
Saturday.  "HQ Bank has overvalued its trading portfolio for a
long time" and reported its financial position inaccurately.

HQ Bank is an investment bank based in Sweden.  It is owned owned
by securities broker HQ AB.


CITY.COM LTD: Supermarket Chain Not Affected by Bankruptcy
The bankruptcy procedures of Ltd. (Kyiv) will not affect
the work of the supermarket chain, Interfax-Ukraine
reports, citing Dina Antypova, the marketing director at Unitrade
Group, which operates the chain.

" now has nothing in common with the chain's operation
activities.  The chain is managed by Personal Electronics Ltd.,
and the right to the trademarks belong to Volodymyr Kolodiuk
[Unitrade Group president]," the report quoted Ms. Antypova as

The report relates since the end of 2008, Volodymyr Kolodiuk and
his brother Andriy Kolodiuk have been in conflict over the
ownership of the companies of Unitrade Group holding.  The
protracted conflict led to the blocking of accounts of the number
of legal entities and the cessation of payments on's
bonds, the report notes.

As of the end of the first quarter of 2009, the debt of
to banks was UAH121.25 million, that on A series bonds was
UAH42.57 million, and that on B series bonds UAH26.77 million, the
report discloses.

U N I T E D   K I N G D O M

CANDOVER INVESTMENTS: To Wind Up & Sell Remaining Portfolio
Martin Arnold and Philip Stafford at The Financial Times report
that Candover plans to wind itself up by returning the cash from
the sale of its remaining portfolio to shareholders, making it the
biggest private equity victim of the financial crisis.

The FT relates Malcolm Fallen, chief executive of Candover
Investments, the listed arm of the private equity group, said it
had chosen the best option for the "maximization of cash to
shareholders".  According to the FT, Mr. Fallen said: "There is
significant value in the underlying investments of our portfolio.
It is not going to happen in weeks or months, but this is a very
measured plan."

Candover has faced limited options since talks collapsed in July
about selling itself to Alberta Investment Management Corporation,
the US$70 billion Canadian pension fund, the FT notes.

The private equity group's downfall was precipitated by a string
of investments made during the market bubble, which have
unraveled, such as Italian luxury yachtmaker Ferretti and Gala
Coral, the UK betting and bingo group, the FT discloses.  When the
credit crisis struck, Candover was forced to abandon its own
commitment to its new EUR3 billion (GBP2.5 billion) fund, leaving
the group without funds for new deals, the FT recounts.

The FT relates Candover said on Tuesday that the net asset value
of its portfolio had fallen 13% to GBP197.4 million, or 903p per
share.  Interim pre-tax losses at Candover widened from GBP25.9
million to GBP27.8 million, while net debt fell from GBP74.8
million to GBP58.8 million.

Candover Investments PLC --
-- is an investment trust listed on the London Stock Exchange
since 1984.  It invests in buyouts across Europe via funds managed
by its wholly owned subsidiary, Candover Partners, a European
private equity house.  As well as investing money on behalf of
Candover Investments plc, Candover raises substantial funds for
buyout investment from third parties such as pension funds,
insurance companies, endowments, charities and other professional

KEYDATA: Former Owner Offers GBP13MM Loan to Prop Up Lifemark
BBC News reports that Stewart Ford, the former boss of insolvent
investment company Keydata, has offered a loan of GBP13 million to
stop its investments from collapsing.

BBC says about 23,000 Keydata customers have GBP350 million
invested in bonds issued by a Luxembourg company called Lifemark.
The investments in the bonds, made up of second-hand life
insurance policies, are at risk because Lifemark may run out of
cash to keep up the premiums, BBC notes.

According to BBC, Mr. Ford says his consortium's loan can keep
Lifemark going for three years.

BBC relates Jack Irvine, a spokesman for Mr. Ford, said the loan
and an associated "restructuring plan" have yet to be finalized,
but should be ready "in the next few weeks".

Last week Mr. Ford allowed the administrator of Lifemark, Eric
Collard of accountants KPMG, to start selling GBP7 million worth
of the second-hand life insurance policies, BBC discloses.  These
had been pledged to Mr. Ford in return for a loan he made to
Lifemark last year, BBC states.  According to BBC, the cash being
raised should keep Lifemark afloat until November this year.

This September, investors in Keydata's Lifemark polices will learn
if the UK's Financial Services Compensation Scheme (FSCS) will be
able to repay them any of the money they fear they have lost on
their investments, BBC notes.

As reported by the Troubled Company Reporter-Europe, Dan
Schwarzmann and Mark Batten of PricewaterhouseCoopers LLP were
appointed joint administrators of Keydata on June 8, 2009.  The
appointment was made based on an application to court by the
FSA on insolvency grounds.

Keydata Investment Services Ltd. designs, distributes and
administers structured investment products.  Keydata operates from
three locations, being London, Glasgow and Reading and administers
its own products as well as portfolios for third parties.

PEGASUS RENT: Company Records Missing; Company Secretary Jailed
Peter Richardson at Burton Mail reports that the Stafford Crown
Court heard that Rafagat Hussain, who was appointed company
secretary of Pegasus Rent in June 2006, failed to produce records
for the Official Receiver.

The report relates Pegasus Rent went into liquidation in December
2006 with debts of almost GBP230,000, but its accounts for the
previous two years had "disappeared".  According to the report,
Neil Chawla, prosecuting, said that as a result, the liquidator
had been unable to assess the company's assets, find out what went
wrong and where the money had gone.

Mr. Hussain admitted failing to preserve records of accounts and
failing to provide information to the liquidator, the report
notes.  He was given a three-month prison sentence, suspended for
two years and ordered to do 200 hours unpaid community work and
pay GBP6,000 costs, the report discloses.

The report recounts business went into decline in 2005, when some
major customers did not renew contracts.

Pegasus Rent was a car hire business based at the Riverside
estate, Atherstone Street, Tamworth.

PROMINENT CMBS: S&P Affirms Rating on Class E Notes at BB (sf)
Standard & Poor's Ratings Services raised and removed from
CreditWatch negative its credit rating on Prominent CMBS Funding
No. 1 PLC 's class B notes.  At the same time, S&P affirmed and
removed from CreditWatch negative its ratings on the class A1, C,
D, and E notes.

The rating actions reflect the reported loan amortization and
consequent note amortization (to approximately 33% of the original
balance), and the remaining loan pool quality.  Due to the
sequential redemption of the notes, the class A2 notes (not rated)
have been fully repaid and the class A1 notes have been repaid to
41% of their initial balance.  As a consequence, the credit
enhancement for almost all classes of notes has improved.  With
regard to the upgraded class B notes, credit enhancement has
increased to 49.4% from 17.8% at closing.

Based on a review of the remaining loans in the pool, S&P has also
affirmed all other ratings and removed them from CreditWatch

S&P placed all of Prominent 1's rated notes on CreditWatch
negative on June 18, 2009, as part of its review of all European
commercial mortgage-backed securities (CMBS) transactions.  In
December 2009, S&P published an update and kept the ratings on
CreditWatch negative.

Prominent CMBS Funding No. 1 is an originator trust transaction
whereby Bank of Scotland PLC initially declared a trust over the
loans.  The transaction closed in December 2005.  The ?584 million
and GBP600 million mortgage-backed notes issued were initially
tied to a pool of 33 commercial real estate loans secured on 168
properties throughout the U.K., plus an additional ?10 million
fully funded reserve account as additional credit enhancement.

According to the latest quarterly investor report that the
servicer--Bank of Scotland PLC--issued on June 21, 2010, the
collateral pool comprised 15 loans with an aggregate balance of
?368.4 million, backed by 95 properties with a reported value of
?468.4 million.

As of June 21, 2010, the transaction is backed by a portfolio of
retail (23.4%), mixed-use (33.5%), office (28.2%), industrial
(13.3%), and warehouse (1.6%) assets.  The assets themselves are
located throughout England and Scotland (98.2%) and Guernsey
(1.8%), with concentration in southeast England (29%), northwest
England (22%), and London (16.2%).

The servicer retains significant flexibility to make further
advances and amendments to the loan terms.  The servicer has
extended the maturity dates for several loans.  All amendments to
the loan terms are subject to certain pool tests, including:

* Pool adjustment criteria, which include: (i) a weighted-average
  loan-to-value ratio equal to or less than 80%; (ii) an interest
  coverage ratio of at least 1.3x; (iii) a weighted-average margin
  equal to or higher than 1%; and (iv) limits regarding property
  type and geographical distribution;

* Additional pool adjustment criteria restricting the total debt
  of a single borrower;

* Limits on the individual loan financial ratios to a maximum LTV
  ratio of 85% and a minimum ICR of 1.1x; and

* The weighted-average remaining loan term being no less than 10
  years, subject to no loan having an expiry date beyond December

The current weighted-average LTV of the pool is reported as 95.5%
as of June 21--significantly above the maximum LTV ratio of 80.0%
(as per the pool tests--see above).  This is mostly due to loan
1200405617, which has an LTV ratio of 224%.  In the June 21
investor report, Bank of Scotland stated that the originator would
reacquire this loan as per the terms of the transaction.  At the
date of the report, the loan had not been repurchased.  S&P
understands that the exclusion of the loan from the pool would
take the reported pool LTV ratio to approximately 73%.

                           Ratings List

                 Prominent CMBS Funding No. 1 PLC
          EUR584 Million and GBP600 Million Mortgage-Backed
                       Floating-Rate Notes

       Ratings Raised and Removed From CreditWatch Negative

        Class       To                    From
        -----       --                    ----
        B           AAA (sf)              AA+ (sf)/Watch Neg

      Rating Affirmed and Removed From CreditWatch Negative

        Class       To                    From
        -----       --                    ----
        A1          AAA (sf)              AAA (sf)/Watch Neg
        C           A (sf)                A (sf)/Watch Neg
        D           BBB (sf)              BBB (sf)/Watch Neg
        E           BB (sf)               BB (sf)/Watch Neg

VBA LTD: Has Pre-Pack Sale Deal With Elitemark
VBA Ltd.'s administrators have agreed to a pre-pack sale of the
business and assets to Elitemark, a company run by VBA's founders,
catalogue e-business reports, citing the North West Business Desk.

According to the report, the deal, for GBP150,000, came about
after VBA failed to gain approval from enough of its creditors to
complete a Company Voluntary Arrangement.

Bolton-based VBA Ltd. traded under the brands Sound and Vision,
HiFi Bitz and Digital Direct.


* Upcoming Meetings, Conferences and Seminars

Sept. 14, 2010
     ABI/NYIC Golf and Tennis Fundraiser
        Maplewood Golf Club, Maplewood, N.J.
           Contact: 1-703-739-0800;

Sept. 20, 2010 (tentative)
     Complex Financial Restructuring Program
        Fordham Law School, New York, N.Y.
           Contact: 1-703-739-0800;

Sept. 22-23, 2010 (tentative)
     ABI/NYU Bankruptcy and Business Reorganization Workshop
        New York University School of Law, New York, N.Y.
           Contact: 1-703-739-0800;

Sept. 23-25, 2010
     Southwest Bankruptcy Conference
        Four Seasons Las Vegas, Las Vegas, Nev.
           Contact: 1-703-739-0800;

Oct. 1, 2010
     ABI/UMKC Midwestern Bankruptcy Institute
        Kansas City Marriott Downtown, Kansas City, Kan.
           Contact: 1-703-739-0800;

Oct. 1, 2010
     ABI/GULC "Views from the Bench"
        Georgetown University Law Center, Washington, D.C.
           Contact: 1-703-739-0800;

Oct. 6-8, 2010
     TMA Annual Convention
        JW Marriott Grande Lakes, Orlando, Florida

Oct. 11, 2010
     Chicago Consumer Bankruptcy Conference
        Standard Club, Chicago, Ill.
           Contact: 1-703-739-0800;

Oct. 15, 2010
     NCBJ/ABI Educational Program
        Hilton New Orleans Riverside, New Orleans, La.
           Contact: 1-703-739-0800;

Oct. 28, 2010
     Mid-Level Professional Development Program
        Weil, Gotshal & Manges LLP, New York, N.Y.
           Contact: 1-703-739-0800;

Oct. 29, 2010 (tentative)
     International Insolvency Symposium
        The Savoy, London, England
           Contact: 1-703-739-0800;

Nov. __, 2010
     Delaware Views from the Bench and Bankruptcy Bar
        Hotel du Pont, Wilmington, Del.
           Contact: 1-703-739-0800;

Nov. 11, 2010
     Detroit Consumer Bankruptcy Conference
        Hyatt Regency Dearborn, Dearborn, Mich.
           Contact: 1-703-739-0800;

Nov. 29, 2010
     17th Annual Distressed Investing Conference
        The Helmsley Park Lane Hotel, New York City
           Contact: 1-903-595-3800;

Dec. 9-11, 2010
     Winter Leadership Conference
        Camelback Inn, a JW Marriott Resort & Spa,
        Scottsdale, Ariz.
           Contact: 1-703-739-0800;

Dec. 2-4, 2010
     22nd Annual Winter Leadership Conference
        Camelback Inn, Scottsdale, Arizona
           Contact: 1-703-739-0800;

January 26-28, 2011
     TMA Distressed Investing Conference
        Aria Las Vegas

Jan. 27-28, 2011
     Rocky Mountain Bankruptcy Conference
        Westin Tabor Center, Denver, Colo.
           Contact: 1-703-739-0800;

Feb. 3-5, 2011
     Caribbean Insolvency Symposium
        Westin Casuarina Resort & Spa, Grand Cayman Island
           Contact: 1-703-739-0800;

Feb. 24-25, 2011
        Four Seasons Las Vegas, Las Vegas, Nev.
           Contact: 1-703-739-0800;

Mar. 4, 2011
     Bankruptcy Battleground West
        Hyatt Regency Century Plaza, Los Angeles, Calif.
           Contact: 1-703-739-0800;

Mar. 7-9, 2011
     Conrad Duberstein Moot Court Competition
        Duberstein U.S. Courthouse, New York, N.Y.
           Contact: 1-703-739-0800;

Mar. 10, 2011
     Nuts and Bolts - Florida
        Tampa, Fla.
           Contact: 1-703-739-0800;

Mar. 10-12, 2011
     SUCL/ Alexander L. Paskay Seminar on
     Bankruptcy Law and Practice
        Marriott Tampa Waterside, Tampa, Fla.
           Contact: 1-703-739-0800;

Mar. 17-19, 2011
     Byrne Judicial Clerkship Institute
        Pepperdine University School of Law, Malibu, Calif.
           Contact: 1-703-739-0800;

Mar. 31-Apr. 3, 2011
     Annual Spring Meeting
        Gaylord National Resort & Convention Center,
        National Harbor, Md.
           Contact: 1-703-739-0800;

April 27-29, 2011
     TMA Spring Conference
        JW Marriott, Chicago, IL

May 5, 2011
     Nuts and Bolts - New York City
        Association of the Bar of the City of New York,
        New York, N.Y.
           Contact: 1-703-739-0800;

May 6, 2011
     New York City Bankruptcy Conference
        Hilton New York, New York, N.Y.
           Contact: 1-703-739-0800;

June 6, 2011
     Canadian-American Cross-Border Insolvency Symposium
        Fairmont Royal York, Toronto, Ont.
           Contact: 1-703-739-0800;

June 9-12, 2011
     Central States Bankruptcy Workshop
        Grand Traverse Resort and Spa, Traverse City, Mich.

July 21-24, 2011
     Northeast Bankruptcy Conference
        Hyatt Regency Newport, Newport, R.I.
           Contact: 1-703-739-0800;

July 27-30, 2011
     Southeast Bankruptcy Workshop
        The Sanctuary at Kiawah Island, Kiawah Island, S.C.
           Contact: 1-703-739-0800;

Aug. 4-6, 2011
     Mid-Atlantic Bankruptcy Workshop
        Hotel Hershey, Hershey, Pa.
           Contact: 1-703-739-0800;

Oct. 14, 2011
     NCBJ/ABI Educational Program
        Tampa Convention Center, Tampa, Fla.
           Contact: 1-703-739-0800;

Oct. __, 2011
     International Insolvency Symposium
        Dublin, Ireland
           Contact: 1-703-739-0800;

Oct. 25-27, 2011
     Hilton San Diego Bayfront, San Diego, CA

Dec. 1-3, 2011
     23rd Annual Winter Leadership Conference
        La Quinta Resort & Spa, La Quinta, Calif.
           Contact: 1-703-739-0800;

Apr. 19-22, 2012
     Annual Spring Meeting
        Gaylord National Resort & Convention Center,
        National Harbor, Md.
           Contact: 1-703-739-0800;

July 14-17, 2012
     Southeast Bankruptcy Workshop
        The Ritz-Carlton Amelia Island, Amelia Island, Fla.
           Contact: 1-703-739-0800;

Aug. 2-4, 2012
     Mid-Atlantic Bankruptcy Workshop
        Hyatt Regency Chesapeake Bay, Cambridge, Md.
           Contact: 1-703-739-0800;

Nov. 29 - Dec. 2, 2012
     Winter Leadership Conference
        JW Marriott Starr Pass Resort & Spa, Tucson, Ariz.
           Contact: 1-703-739-0800;


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

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  Go to 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.  Joy A. Agravante, Valerie U. Pascual, Marites O.
Claro, Rousel Elaine T. Fernandez, Frauline S. Abangan and Peter
A. Chapman, Editors.

Copyright 2010.  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 * * *