/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/110126.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, January 26, 2011, Vol. 12, No. 18 Headlines C Z E C H R E P U B L I C SAZKA AS: Wants Court to Order Hearing of Insolvency Proceedings G E R M A N Y BAYERISCHE LANDESBANK: Mulls Legal Action v. Ex-Chief Risk Officer STABILITY CMBS: S&P Affirms 'BB (sf)' Rating on Class E Notes G R E E C E FRESENIUS MEDICAL: Moody's Rates Senior Unsecured Notes at 'Ba2' I C E L A N D ROKA EHF: Bankruptcy Estate Files Suit Against Nyherji I R E L A N D MCENANEY CONSTRUCTION: Goes Into Receivership, Owes EUR75 Million I T A L Y CONVATEC HEALTHCARE: Moody's Assigns 'B2' Corporate Family Rating L I T H U A N I A A.L.D. AB: Vilnius Court Initiates Bankruptcy Proceedings INVESTICIJOS AB: Kaunas Court Initiates Bankruptcy Proceedings N E T H E R L A N D S HARBOURMASTER PRO-RATA: Fitch Says FX Options Won't Affect Ratings UPCB FINANCE: S&P Rates Proposed EUR750MM Sr. Sec. Notes at 'B+' S P A I N CABLEUROPA SAU: S&P Puts 'B-' Rating on CreditWatch Positive ONO FINANCE: Fitch Rates EUR460MM Sr. Unsec. Notes at 'CCC(exp)' * SPAIN: Wants Weaker Savings Banks to Raise More Capital U K R A I N E METINVEST BV: Moody's Upgrades Senior Unsecured Rating to 'B2' METINVEST BV: Fitch Rates Proposed USD Notes at 'B' U N I T E D K I N G D O M BLADE TOOLING: KPMG Closes Deal With Gardner Group, Saves 60 Jobs ESTATES & GENERAL: Placed in Voluntary Liquidation FURNITURE TODAY: In Creditors Voluntary Liquidation LEAMINGTON DESSERTS: Administrators Close Factory, Axes 160 Jobs WAKEFIELD TRINITY: Faces Administration on Unpaid Taxes * UK: Business Insolvencies Down 18% in 2010, Experian Says * UK: Begbies Traynor Expects 10% Rise in Insolvencies in 2011 ********* =========================== C Z E C H R E P U B L I C =========================== SAZKA AS: Wants Court to Order Hearing of Insolvency Proceedings ---------------------------------------------------------------- Sazka AS wants the Municipal Court in Prague to order hearing of the insolvency proceedings initiated by Radovan Vitek's firm Moranda against the company, CTK reports, citing a document that Jaromir Cisar, Sazka's lawyer, has supplied to court. Mr. Cisar, CTK says, has been given full powers by Sazka to represent it in the proceedings. According to CTK, Sazka demands that the court deal with Moranda's proposal in the physical presence of both sides' lawyers. If Sazka did not take this step, the court could decide on the insolvency proposal on the basis of the presented documents only, CTK states. Sazka now has 20 days from receiving the announcement about the start of the proceedings to send to the court its stance on Mr. Vitek's proposal, CTK discloses. Sazka also has to submit the whole list of its assets, including the debtors and creditors, as well as a list of its employees and documents proving insolvency or the danger of insolvency, CTK notes. Mr. Vitek asserts that Sazka is in an insolvency situation because it has excessive debts, with total debts worth over CZK10 billion, CTK discloses. He claims that Sazka's owner's equity has a negative value, CTK relates. As reported by the Troubled Company Reporter-Europe, Bloomberg News, citing CTK, said Mr. Vitek, who owns Sazka debts worth CZK1.5 billion (US$81.7 million), filed an insolvency proposal against Sazka on Jan. 18. The Troubled Company Reporter-Europe, citing Bloomberg News, reported on Jan. 18 that Sazka Chairman Ales Husak said the company isn't legally in an insolvency situation and will use all available means to fight attempts to put it into bankruptcy. Sazka also doesn't recognize debt claims made by Mr. Vitek and accused him of trying to start a "hostile takeover attempt," Bloomberg quoted Mr. Cisar as saying. Sazka AS is a provider of lotteries and sport betting games in the Czech Republic. * * * As reported by the Troubled Company Reporter-Europe on Jan. 17, 2011, Standard & Poor's Ratings Services lowered to 'D' (Default) from 'CC' its long-term corporate credit rating on Czech gaming Company SAZKA a.s. At the same time, S&P lowered to 'D' from 'CC' the issue rating on the company's EUR215 million 9.00% secured amortizing bonds due 2021. "The downgrade follows SAZKA's nonpayment of principal -- due Jan. 12, 2011 -- on its EUR215 million bonds maturing 2021," said Standard & Poor's credit analyst Marketa Horkova. SAZKA issued a notice to bondholders on Jan. 6, 2011, advising that it may only be able to make a full payment of the interest on the bonds, but not of the principal. As part of the same notice, SAZKA informed the bond trustee that it had initiated negotiations with creditors with a view to resolving this situation and restructuring its existing debt. ============= G E R M A N Y ============= BAYERISCHE LANDESBANK: Mulls Legal Action v. Ex-Chief Risk Officer ------------------------------------------------------------------ James Wilson at The Financial Times reports that Bayerische Landesbank's supervisory board is to start legal action against Gerhard Gribkowsky, the bank's former chief risk officer, for his part in the bank's purchase of Austrian bank Hypo Group Alpe Adria. According to the FT, some EUR200 million (US$272 million) in damages is being sought from Mr. Gribkowsky and others who were on BayernLB's management board at the time the HGAA deal -- which ended up costing BayernLB billions in losses -- was approved in 2007. Mr. Gribkowsky is apparently being targeted first for legal action because of subsequent accusations that he received US$50 million that German state prosecutors believe stems from corrupt payments, the FT states. Prosecutors arrested Mr. Gribkowsky this month, alleging he was paid the money as part of a deal when BayernLB sold a stake in the business that controlled Formula One motor racing in 2006, the FT relates. According to the FT, prosecutors say Mr. Gribkowsky remains under arrest and is suspected of corruption, breach of trust and tax evasion. The FT notes that sources familiar with BayernLB said legal action against Mr. Gribkowsky was being launched in Germany to try to help assert any eventual claim by BayernLB to the money allegedly received by Mr. Gribkowsky, which it is claimed was paid into a company and a charitable foundation in Austria. BayernLB's supervisory board revealed in October that it would pursue damages claims against the bank's former top managers in connection with the acquisition of HGAA, the FT recounts. The bank lost EUR3.7 billion during its brief ownership of HGAA, which was taken over by the Austrian government in 2009, the FT discloses. As reported by the Troubled Company Reporter-Europe, Bloomberg News said BayernLB, Germany's second-biggest state-owned bank, ousted Mr. Gribkowsky in April 2008 after the company reported writedowns related to the collapse of the U.S. subprime-mortgage market. BayernLB needed EUR10 billion (US$13 billion) in capital from the German state of Bavaria to prop it up during the financial crisis, Bloomberg disclosed. About BayernLB Bayerische Landesbank a.k.a BayernLB -- http://www.bayernlb.de/-- acts as the principal bank to the state of Bavaria and as the central clearing house for the 75 Bavarian sparkassen (savings banks). Also serving corporations, national and local governments, financial institutions, and real estate firms, the bank offers a variety of services, including financing, security underwriting and trading, and risk management. It provides retail and private banking services for individuals through its Internet bank, Deutsche Kreditbank, and through banking subsidiaries in central and southeastern Europe. BayernLB's Landesbank Saar subsidiary (75% owned) provides financing to small and midsized businesses in the German state of Saarland and in France. * * * As reported by the Troubled Company Reporter-Europe on Sept. 29, 2010, Fitch Ratings upgraded the Individual Rating of BayernLB to 'D' from 'D/E'. Fitch expects to review the RWN on BayernLB's ratings when the European Commission announces its decision on the bank's state aid or if BayernLB's recently announced exploratory discussions with WestLB result in a concrete merger plan. STABILITY CMBS: S&P Affirms 'BB (sf)' Rating on Class E Notes ------------------------------------------------------------- Standard & Poor's Ratings Services raised its credit rating on STABILITY CMBS 2007-1 GmbH's class B notes to 'AAA (sf)' from 'AA (sf)' and affirmed its ratings on all other classes of notes. At the same time, S&P removed the class D and E notes from CreditWatch negative. The transaction is structured as a synthetic, partially funded commercial mortgage-backed securities (CMBS) transaction. Its purpose was to transfer the credit risk associated with an initial reference portfolio of 218 mortgage loans secured on commercial properties, located mainly in Germany. Currently, 148 commercial mortgage loans remain in the reference portfolio. The reference portfolio amounted to EUR909.2 million at closing and had reduced to EUR650.0 million as of the October 2010 investor report, due to prepayments and scheduled amortization of the transaction. The mortgages secure the reference pool and, in the case of 23 of the loans, additional debt for which the originator's share ranks pari passu with other syndicate banks. The amount of this additional debt at the October 2010 investor report was EUR1,217.1 million, down from EUR1,257 million at issuance. There are also prior-ranking mortgages amounting to EUR764,313, down from EUR15.1 million at issuance. The notes are secured against certificates issued by KfW and linked to the issuer credit rating on KfW (AAA/Stable/A-1+). Thus, the ratings on the notes are capped at the rating on KfW, and S&P would lower them if the rating agency were to downgrade KfW. According to the latest investor report available to us (October 2010), the reference portfolio has no delinquency or credit events. There have also been no principal losses to date. The transaction currently has 81 borrower groups, down from 91 at issuance. The main property types securing the loans by balance are office (65%), mixed-use (16%), and retail (12%); at issuance, the main property types were also office (53%), mixed-use (20%), and retail (14%). The properties are mainly located in Germany (89% by loan balance) and the remainder in The Netherlands, Austria, Luxembourg, and the U.K. This is in line with the portfolio at issuance. The weighted-average servicer reported loan-to-value (LTV) ratio has reduced to 59%, from 66% at closing. Initially, 28% of the reference portfolio balance had a bank LTV ratio between 70% and 100%; currently, 7% of the reference portfolio falls into this bracket. The bank weighted-average interest coverage ratio and the debt service coverage ratio are 2.94x and 1.54x, respectively, up from 2.14x and 1.38x at issuance. The weighted-average seasoning of the pool has increased to 6.0 years, from 3.9 years at closing. Of the reference portfolio at closing, 52% by balance had a fixed interest rate, 37% had a floating interest rate that was hedged, and 11% had an unhedged floating interest rate. This composition has changed and the share of fixed-rate loans has decreased to 45%, while floating- rate hedged loans have increased to 45% and unhedged floating-rate loans have decreased to 10%. S&P have affirmed the ratings on the class A+, A, C, D, and E notes to reflect its view of the creditworthiness of the underlying reference portfolio, which the rating agency believes is commensurate with the ratings assigned. This is mainly due to the following factors: -- Performance has been stable. -- There have been no principal losses since issuance, and according to the October 2010 investor report, there are no arrears or credit events. -- Although the property portfolio is mainly located in secondary and tertiary locations, approximately 52% of the reference portfolio by balance amortizes over the term (annuity or fixed installments) and the weighted-average servicer reported LTV ratio has reduced to 59%, from 66% at closing. -- As 104 properties consisting of 1,599 rental agreements secure the reference portfolio, the property income remains granular. The upgrade of the class B notes reflects the above factors and the paydown of the reference portfolio by 29% since issuance. As all scheduled and unscheduled principal payments are applied sequentially, credit enhancement has increased and the senior classes have benefited. Ratings List Rating Class To From STABILITY CMBS 2007-1 GmbH EUR182.4 Million Floating-Rate Credit-Linked Notes Rating Raised B AAA (sf) AA (sf) Ratings Affirmed and Removed From CreditWatch Negative D BBB (sf) BBB/Watch Neg (sf) E BB (sf) BB/Watch Neg (sf) Ratings Affirmed A+ AAA (sf) A AAA (sf) C A (sf) =========== G R E E C E =========== FRESENIUS MEDICAL: Moody's Rates Senior Unsecured Notes at 'Ba2' ---------------------------------------------------------------- Moody's Investors Service assigned a Ba2 rating to the following proposed bond issuances of finance companies wholly owned by Fresenius Medical Care AG & Co. KGaA: approximately US$500 million worth of senior unsecured notes by Fresenius Medical Care US Finance, Inc.; and around EUR300 million worth of senior unsecured notes by FMC Finance VII S.A. FME, together with the intermediate holding companies Fresenius Medical Holdings, Inc. and Fresenius Medical Care Deutschland GmbH, guarantees the notes. The senior unsecured notes are expected to be used to refinance short-term debt and to fund acquisitions. "The Ba2 rating on the new senior unsecured notes to be issued at the level of the financing subsidiaries reflects the instrument's relative position in the capital structure of FME and a Loss Given Default assessment of LGD 5 (74%)," says Wolfgang Draack, a Moody's Senior Vice President and lead analyst for FME. "The notes benefit from a downstream senior guarantee by FME, and upstream guarantees by Fresenius Medical Care Holdings Inc. and Fresenius Medical Care Deutschland GmbH, in line with the outstanding senior unsecured notes of various finance issuers in the group," adds Mr. Draack. FME's Ba1 corporate family rating is supported by: (i) its absolute scale and a strong market position as a leading global provider of dialysis products and private dialysis services; (ii) continued favorable industry growth trends as well as the recurring nature of the group's revenues; (iii) high profitability levels; and (iv) good financial flexibility. However, the rating is constrained by: (i) FME's relatively high adjusted financial leverage; (ii) the potential risks from the group's pure-play focus on the dialysis market, albeit mitigated by its position as a provider of both products and services; (iii) regional concentration on the North American market, which is nonetheless likely to be reduced over the medium term; (iv) the group's exposure to regulatory changes, government investigations, pricing pressure from governments and healthcare organizations or changes in the payer mix; and (v) a growth strategy that involves organic growth as well as acquisitions, which are usually debt-financed. FME recently announced (i) a joint venture agreement with Galenica Ltd. to develop and distribute on a worldwide basis products to treat iron deficiency anaemia and bone mineral metabolism, which will require compensating payments from FME; and (ii) on January 4, 2011, the acquisition of International Dialysis Centers, a segment of Euromedic International, for approximately US$650 million. Moody's expects these, and possible further growth investments, to be funded by internally generated cash flow and debt issuance. As a result of its solid performance and restrained acquisition activity after the 2006 purchase of Renal Care Group, FME has built significant headroom into its credit metrics versus rating guidance. In Moody's view, for FME to avoid rating pressure on its Ba1 CFR, the group will need to maintain a debt/EBITDA ratio of below 3.5x (3.1x LTM to September 2010) and achieve a cash flow from operations (CFO)/debt ratio of at least 15% (20%). Moody's believes that this metric headroom will be sufficient to accommodate FME's investment strategy. In Moody's view, downward rating pressure would likely be the result of: (i) unfavorable reimbursement changes in core markets or changes in payer mix, affecting the group's profit generation; (ii) an increase in financial leverage, evidenced by a debt/EBITDA ratio above 3.5x and a CFO/debt ratio below 15%; or (ii) material litigation. A rating upgrade would require enhanced regional diversification and continued growth with profitability at current levels (EBIT margin in the high teens) contributing to gradual improvements in leverage, such that the group's debt/EBITDA ratio moves towards 3.0x and its and CFO/debt ratio approaches 20%. Without acquisitions, FME would be on course to achieve this. Issuer: FMC Finance VII S.A. , Assignments: * Senior Unsecured Regular Bond/Debenture, Assigned a range of 74 - LGD5 to Ba2 Issuer: Fresenius Medical Care US Finance, Inc. , Assignments: * Senior Unsecured Regular Bond/Debenture, Assigned a range of 74 - LGD5 to Ba2 The Ba2 rating for the proposed issuance of approximately USD900 million worth of senior unsecured notes is two notches below the Baa3 rating for the group's US$4.1 billion worth of senior credit facilities. This reflects the effective subordination of the senior unsecured notes relative to the sizable proportion of secured debt in the capital structure. The facilities, guaranteed on a senior basis by most of the operating companies, are secured by a share pledge by most of the group's operating subsidiaries and by a springing lien on substantially all assets, which becomes effective if FME's credit ratings deteriorate below the Ba3 category. The Ba2 rating on the proposed senior unsecured notes is one notch below FME's Ba1 CFR, reflecting the dominant position of the senior secured credit facility in the group's capital structure. The Ba2 rating on the group's senior unsecured notes is one notch above the Ba3 rating for the group's trust-preferred securities. The Ba3 rating on the US$63463 million worth of trust-preferred securities -- issued at the level of Fresenius Medical Care Capital Trusts and guaranteed on a subordinated basis by FME, Fresenius Medical Care Deutschland GmbH and Fresenius Medical Care Holdings Inc. -- reflects their contractual subordination to the senior credit facilities as well as to the operating company obligations, including the senior unsecured notes. Moody's previous rating action on FME was implemented on January 11, 2010, when the rating agency assigned a Ba2 rating to the group's proposed issuance of approximately EUR250 million worth of senior unsecured notes due in 2016, which were to be issued by FMC Finance VI S.A. and guaranteed by FME, Fresenius Medical Holdings, Inc. and Fresenius Medical Care Deutschland GmbH. At the same time, Moody's affirmed all the other ratings of FME. The principal methodology used in this rating was Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Based in Bad Homburg, Germany, FME is the world's leading providers of dialysis products and services. In the first nine months of FY 2010, the group generated net revenues of US$8.9 billion. ============= I C E L A N D ============= ROKA EHF: Bankruptcy Estate Files Suit Against Nyherji ------------------------------------------------------ Nasdaq OMX Iceland has been notified that pursuant to a purchase and sale agreement dated January 2, 2009, Nyherji hf. assumed control of the companies Skyggnir hf., TMS Origo ehf., EMR ehf., Vigor ehf., Vioja ehf., TM Software ITP ehf. and Theriak Medication Management ehf., from its subsidiary Roka ehf. (previously TM Software ehf.). Nyherji also acquired the subsidiary's real estate and liquid assets. By a decision of the District of Reykjanes dated March 17, 2010, Roka was subjected to bankruptcy proceedings at the request of Straumur-Burdaras Investment Bank hf. This decision was confirmed by a judgment of the Supreme Court dated May 7, 2010 in case No. 205/2010. On January 19, 2011, the bankruptcy estate of Roka filed a lawsuit against Nyherji seeking avoidance of the disposal of the aforementioned assets pursuant to the parties' purchase and sale agreement and the payment of compensation. Nyherji dismisses the bankruptcy estate's claims as without merit. The company maintains that it paid a fair price for the assets concerned and that all creditors of the bankruptcy estate were treated equally. Consequently, the company intends to defend itself against the bankruptcy estate' claims. Nyherji has substantial claims against Roka which it filed in the bankruptcy proceedings. It remains to be seen whether the claims filed against the estate will be accepted, but in the unlikely event that the estate's compensation claim is successful, Nyherji will presumably be able to recoup a large part of the compensation amount back from the estate, thus reducing the company's financial risk in respect of the lawsuit. ============= I R E L A N D ============= MCENANEY CONSTRUCTION: Goes Into Receivership, Owes EUR75 Million ----------------------------------------------------------------- Gavin Daly at The Sunday Business Post Online reports that McEnaney Construction, which was rescued from examinership three years ago, has been put into receivership by the National Asset Management Agency (Nama) and Ulster Bank. The report relates that the company has debts of almost EUR75 million. Nama has taken over the company's debts to Irish Nationwide and made a joint move with Ulster Bank to appoint Tom Kavanagh of Kavanagh Fennell as receiver, according to The Sunday Business Post Online. The firm announced plans in 2006 to build the M1 Euro Park, a EUR200 million development on a 90-acre site outside Dundalk, The Sunday Business Post Online recounts. However, it ran into financial difficulties the following year, and went into examinership at the end of 2007. The Sunday Business Post Online discloses that John McCann, the developer that controls the firm, backed a rescue package that involved him taking a 75% stake in McEnaney Construction, while Sean McEnaney, its founder, was left with a 25% stake. In 2009, the company was reported to be seeking a new investor and trying to sell off sites and investment properties, according to the report. The Sunday Business Post Online notes that the latest accounts for McEnaney Construction show that it had more than EUR74 million in outstanding loans at the end of April 2009. Headquartered in Switzerland, McEnaney Construction is a building company. The company is controlled by developer John McCann. ========= I T A L Y ========= CONVATEC HEALTHCARE: Moody's Assigns 'B2' Corporate Family Rating ----------------------------------------------------------------- Moody's Investors Service assigned definitive B2 corporate family and probability of default ratings to ConvaTec Healthcare B S.a.r.l. and also assigned definitive ratings to various debt instruments issued in December 2010 in the context of a refinancing of ConvaTec's previous financing package. ConvaTec's rated debt instruments include EUR300 million senior secured notes due in 2017, EUR250 million senior unsecured notes due 2018 (Caa1), US$745 million senior unsecured notes due in 2018 (Caa1), a US$250 million senior secured revolving credit facility due 2015 (Ba3) as well as a US$500 million and EUR550 million senior secured term loan due in 2016 (Ba3). Moody's definitive ratings assigned today confirm the provisional corporate family, probability of default and instrument ratings assigned on December 13, 2010. While the size of ConvaTec's new financing package and the terms and conditions of the various debt instruments are in line with what Moody's expected in its last rating action, Moody's notes that the allocation of debt amounts to the various debt instruments has changed as summarized below, leading to changes in the assigned LGD ranges and point estimates. ConvaTec's financing package consist of a US$1,250 million senior secured term loan, a U$250 million senior secured revolving credit facility as well as EUR300 million senior secured notes, which all benefit from guarantees of group entities representing at least 85% of consolidated assets and EBITDA. The US$1,077 million senior unsecured notes benefit from the same, pari-passu ranking guarantees as the secured debt instruments. The secured debt instruments additionally benefit from first priority pledges over the majority of the group's assets, supporting the Ba3 rating of senior secured bank debt and notes, while the US$1,077 million senior unsecured notes carry a Caa1 rating. The company's preferred equity certificates are, based on the final documentation provided to Moody's, treated as 100% equity. As outlined in Moody's Press Release dated December 13, 2010, the B2 Corporate Family Rating reflects the initially weak credit metrics with an expected debt/EBITDA of approximately 6.4x after the refinancing, which is mitigated by the company's leading position in relatively non cyclical, and thus predictable markets, as well as ConvaTec's broad product portfolio, track record of product life-cycle management and innovation, solid geographic diversification and limited customer concentration. The positive outlook reflects Moody's expectation that ConvaTec is well positioned to benefit from further growth in its end markets and that it will be able to maintain high levels of profitability and cash flow generation. In addition, the positive outlook assumes that ConvaTec will apply future positive cash flows to the repayment of debt supporting a continued deleveraging, as exemplified by a Debt/EBITDA ratio of 6.0x to be achieved within 12 months. Moody's notes that the positive outlook does not incorporate headroom for major extraordinary investment activity or acquisitions. The principal methodology used in this rating was Global Medical Products & Device Industry published in October 2009. ConvaTec is a leading developer, manufacturer and marketer of innovative medical technologies, in particular products for ostomy management, advanced chronic and acute wound care, continence care, sterile single-use medical devices for hospitals and infusion sets used in diabetes treatment infusion devices. For the last twelve months ending September 2010, ConvaTec reported revenues of US$1.5 billion and an adjusted EBITDA of USD435 million. Founded in 1978 as a division of Bristol-Myers Squibb, ConvaTec was acquired by private equity sponsors Nordic Capital and Avista Capital Partners in 2008. ================= L I T H U A N I A ================= A.L.D. AB: Vilnius Court Initiates Bankruptcy Proceedings --------------------------------------------------------- On December 8, 2010, the Imoniu grupe ALITA, AB notified that the State Social Insurance Fund Board SODRA, and UAB Vilniaus alus had filed petitions to the Vilnius Regional Court concerning the initiation of bankruptcy proceedings of the subsidiary UAB A.L.D. The Court by its ruling awarded the petitions and decided to: -- initiate the bankruptcy proceeding of the defendant UAB A.L.D. (company's code 151461114, registered office address Gostauto St. 12a, Vilnius); and -- appoint Janina Lapeniene to act as the bankruptcy administrator of UAB A.L.D. (bankruptcy administrator certificate No. 715b, address S. Staneviciaus St. 34-39, Vilnius). The Decision of the Court has come into effect and further the activities of the subsidiary UAB A.L.D. shall be subject to the provisions of the Law on Enterprise Bankruptcy of the Republic of Lithuania. INVESTICIJOS AB: Kaunas Court Initiates Bankruptcy Proceedings -------------------------------------------------------------- The Kaunas Regional Court has approved a petition filed by AB ALT investicijos's manager to initiate bankruptcy proceedings against the company. The bankruptcy petition was filed on December 22, 2010. On January 19, 2011, the Court decided to: -- initiate the bankruptcy proceedings of AB ALT investicijos; -- appoint UAB Insolvensa (company's code 302315617, registered office address Konstitucijos Av. 12, Vilnius) to act as the administrator of AB ALT Investicijos; and -- consider Swedbank AB the Claimant in the case in which the defendant shall be AB ALT investicijos. The Decision within 10 days from the passing thereof may be appealed to the Court of Appeal of Lithuania through the Kaunas Regional Court. AB ALT investicijos is based in Alytus, the Republic of Lithuania. ===================== N E T H E R L A N D S ===================== HARBOURMASTER PRO-RATA: Fitch Says FX Options Won't Affect Ratings ------------------------------------------------------------------ Fitch Ratings said that the ratings of Harbourmaster Pro-rata CLO 3 B.V. will not be affected by the change of the FX options counterparty. * EUR201.7 million Class A1-T floating-rate notes (ISIN: XS0306976266): 'AAAsf', Outlook Stable, Loss Severity (LS) Rating 'LS2'; * EUR135 million Class A1-VF floating-rate notes: 'AAAsf', Outlook Stable, 'LS2'; * EUR95 million Class A2 floating-rate notes (ISIN: XS0306976696): 'AAAsf', Rating Watch Negative (RWN), 'LS3'; * EUR52 million Class A3 floating-rate notes (ISIN: XS0306977157): 'Asf', on RWN, 'LS3'; * EUR32 million Class A4 floating-rate notes (ISIN: XS0306977314): 'BBBsf', on RWN, 'LS4'; * EUR21.3 million Class B1 floating-rate notes (ISIN: XS0306978981): 'BBsf', on RWN, 'LS5'; * EUR15 million Class B2 floating-rate notes (ISIN: XS0306979955): 'Bsf', on RWN, 'LS5'; * EUR14.7 million Class S1 combination notes (ISIN: XS0306980532): 'AAAsf', Outlook Stable; * EUR2.5 million Class S2 combination notes (ISIN: XS0306980706): 'BBsf', on RWN; * EUR10 million Class S3 combination notes (ISIN: XS0306981423): 'B+sf', on RWN; * EUR10 million Class S4 combination notes (ISIN: XS0306981779): 'BBBsf', on RWN Barclays Bank PLC has replaced Banque AIG as the FX options counterparty. The terms of these contracts have remained almost identical with only minor differences that are not material enough to impact the ratings of the transaction. The classes A2, A3, A4, B1, B2, S2, S3 and S4 are on RWN due to continuing uncertainty over the treatment of defaulted assets for the purpose of the transaction's over-collateralization and interest coverage tests. UPCB FINANCE: S&P Rates Proposed EUR750MM Sr. Sec. Notes at 'B+' ---------------------------------------------------------------- Standard & Poor's Ratings Services assigned a 'B+' issue rating to the proposed EUR750 million senior secured notes to be issued by special purpose vehicle (SPV) UPCB Finance II Ltd. (not rated). UPCB Finance II is incorporated as a Company limited by shares under Cayman Islands law and is owned 100% by a charitable trust. S&P has not assigned a corporate credit rating to UPCB Finance II, nor has it assigned a recovery rating to the proposed notes. S&P understands that the proceeds from the proposed notes will be passed through to UPC Financing Partnership, UPC Broadband Holding B.V. (UPC Broadband; B+/Positive/--), and its subsidiaries (together, the UPC group) via a back-to-back loan. S&P has assigned a 'B+' issue rating to this proposed loan (the proposed SPV Finco loan). At the same time, S&P assigned a recovery rating of '3' to the proposed loan, reflecting its expectation of meaningful (50%-70%) recovery in the event of a payment default. The ratings on the proposed notes and on the proposed SPV Finco loan are based on preliminary information and are subject to S&P's satisfactory review of final documentation. In the event of any changes to the amount and terms of the facility, the recovery and issue ratings might be subject to further review. The rating on the proposed SPV Finco loan is predicated on S&P's understanding that this facility will be part of the existing credit agreement and will thereby share the same guarantee and security package as that granted to the existing secured creditors. S&P also understands that the loan proceeds will be fully used to repay a proportion of the UPC group's outstanding secured bank debt. The ratings on the proposed senior secured notes are based on the notes' first-ranking security interest over UPCB Finance II's rights to, and benefit in, the proposed SPV Finco loan, which has in turn all the same rights (in terms of security and guarantee package) as a lender under the UPC group's existing bank facility. The ratings are also based on the direct pass-through of the economic benefit of the proposed SPV Finco loan to the noteholders, through notes whose terms are back to back with those of the loan. UPCB Finance II is an orphan SPV, whose activity is limited only to the issue of the proposed notes and the onlending of the proceeds to various group entities. These features offset the fact that neither UPC Broadband nor any of its subsidiaries will guarantee or provide any credit support to UPCB Finance II, and that the proposed notes will not have a direct claim on the cash flows and the assets of the UPC group. The ratings on the proposed notes reflect the issue ratings on the proposed SPV Finco loan. Any change to the preliminary documentation related to the pass-through features and other legal aspects of the transaction could have a material effect on the ratings on the proposed notes. Recovery Analysis In order to determine recoveries, S&P simulates a hypothetical default scenario. In particular, S&P believes that a default would most likely result from excessive leverage and the UPC group's inability to refinance maturing debt in 2014-2015, following an assumed operating underperformance. S&P values the UPC group on a going-concern basis, as the rating agency believes that its leading market position, high barriers to entry, established network assets, and substantial subscriber base would be recognized by potential buyers even under distressed circumstances. At the hypothetical point of default in 2014-2015, S&P values the UPC group at about EUR5.4 billion. The issue and recovery ratings on the proposed SPV Finco loan reflect S&P's estimate of value available and accessible to the creditors, and the UPC group's current capital structure. The security package includes a first-ranking share pledge over all the UPC intermediate holding companies that own the cable- operating subsidiaries. No assets are pledged. With regard to the pass-through transaction, although S&P has not assigned a recovery rating to the proposed senior secured notes, S&P believes that the recovery prospects for these notes are intrinsically linked to the recovery prospects for the proposed senior secured SPV Finco loan. This link is based on the assignment of rights under the SPV Finco loan that S&P anticipates will be granted to the holders of the proposed notes. As a result of this assignment, S&P considers that potential recovery for noteholders would rely entirely on the effective operation of the pass-through structure between the corporate entities (the UPC group) and the issuer (UPCB Finance II). In addition, S&P foresees a risk that the enforcement costs at the issuer level could create an additional layer of expense that may slightly reduce the recovery prospects for the noteholders versus the direct recovery prospects for the lender of the proposed SPV Finco loan. The recovery prospects for all the UPC group's debt instruments reflect the estimated value available and accessible to the respective creditors, the high proportion of senior secured debt in the capital structure, and the likelihood of insolvency proceedings being adversely influenced by UPC's multijurisdictional exposure. The recovery rating on the senior secured debt also reflects the weak security package. ========= S P A I N ========= CABLEUROPA SAU: S&P Puts 'B-' Rating on CreditWatch Positive ------------------------------------------------------------ Standard & Poor's Ratings Services placed its 'B-' long-term corporate credit rating on Spanish cable operator Cableuropa S.A.U. on CreditWatch with positive implications. S&P also placed on CreditWatch with positive implications the 'B-' rating on the senior secured notes, issued by special-purpose vehicle Nara Cable Funding Ltd. At the same time, S&P assigned a 'CCC' debt rating to the proposed EUR460 million-equivalent unsecured notes to be issued by ONO Finance II PLC (not rated), a special-purpose financing entity related to Cableuropa S.A.U. S&P also placed this rating on CreditWatch with positive implications. S&P assigned a recovery rating of '6' to the proposed notes, indicating its expectation of negligible (0%-10%) recovery for creditors in the event of a payment default. The CreditWatch placement follows Cableuropa's announced plans to refinance its existing EUR450 million unsecured notes due 2014 with EUR460 million of unsecured long-dated notes. Cableuropa already successfully completed a partial refinancing of its bank debt in May 2010 and issuance of EUR700 million of senior secured notes to prepay some bank debt in October 2010. "We see the proposed transaction as a further positive step by Cableuropa to improve its debt maturity profile and financial flexibility," said Standard & Poor's credit analyst Guillaume Trentin. "We believe in particular that, if successful, this third step in the Company's multi-stage refinancing process would place the Company in a more favorable position to refinance its large bank facilities maturing in 2013," said Mr. Trentin. Excluding the 2013 liquidity wall, the Company has no major debt maturities before 2018, pro forma for the transaction. On Sept. 30, 2010, Cableuropa reported gross consolidated debt of close to EUR3.8 billion. Based on a preliminary assessment of the refinancing's benefits and S&P's expectations in terms of operating performance for 2011, S&P believes that the rating could be raised to 'B' soon after the completion of the transaction. This would reflect S&P's view that an improving debt maturity profile, combined with steadily increasing cash flow generation, would place the Company in a more favorable position to achieve further refinancing, as necessary, over the coming 12-18 months. If, However, Cableuropa fails to refinance its unsecured notes, S&P could affirm the rating at 'B-'. However, in the absence of a rapid alternative refinancing plan, this would certainly reduce the Company's financial flexibility, leading potentially to rapidly rising rating pressure, given mounting refinancing risk. Cableuropa's refinancing and covenant-related risks still constrain the rating, in S&P's opinion. The rating also reflects S&P's view that the macroeconomic and competitive environment for Cableuropa's core telecommunication and pay-TV services in Spain remains difficult, that the Company generates modest free operating cash flow, and that it carries high debt leverage. However, supportive factors for the rating include Cableuropa's position as Spain's No. 2 facility-based provider of triple-play services, the sound operating resilience of its core residential segment, and the Company's successful track record of improving its profitability to a solid level and steadily raising cash flow generation since 2008. ONO FINANCE: Fitch Rates EUR460MM Sr. Unsec. Notes at 'CCC(exp)' ---------------------------------------------------------------- Fitch Ratings assigned ONO Finance II plc's, a finance vehicle for Cableuropa, proposed EUR460 million 2021 subordinated senior unsecured notes, an expected rating of 'CCC(exp)' and an expected Recovery Rating of 'RR6(exp)'. Fitch has also affirmed Cableuropa's Long- and Short-term Issuer Default Ratings at 'B' and Cableuropa SA's and Nara Cable Funding's senior secured facilities at 'BB-'/'RR2', respectively. The Outlook for the Long-term IDR is Stable. The purpose of the notes issuance is to refinance and pre-pay ONO Finance Plc's and ONO Finance II's senior notes due in 2014 and certain other indebtedness. Upon prepayment, the ratings on these notes will be withdrawn. The final rating of the notes is subject to completion of the deal, which is expected in January 2011, and all final terms conforming to information already received by Fitch. "The proposed transaction represents a further step forward in Cableuropa's refinancing plans. Following the actions taken in 2010, the company is taking a proactive approach to refinancing its balance sheet," says Stuart Reid, a Senior Director in Fitch European TMT team. "Although in volume terms the new notes will represent a small proportion of the overall capital structure, Fitch considers the maintenance of some subordinated debt in the structure to be important in terms of addressing its bank maturities, which largely fall due in 2013." The proposed transaction is expected to be largely leverage- neutral, as subordinated debt will be replaced with the EUR460m longer-dated subordinated notes. The notes will benefit from a senior guarantee from ONO Midco, Cableuropa's direct parent, and a subordinated guarantee from Cableuropa. Fitch does not expect the new notes to have any impact on Cableuropa's existing instrument ratings and expected recoveries. Fitch takes a positive view of the proposed notes with regard to the company's overall refinancing profile. However, any rating action on the IDRs is at this stage more dependent on ongoing business performance amid the difficult economic environment prevailing in Spain. Performance has held up well through the financial downturn. With free cash flow expected to have reached a turning point in 2010, positive rating action may result from a net debt/annualized EBITDA below 5x and demonstrated sizable free cash flow on a sustained basis. * SPAIN: Wants Weaker Savings Banks to Raise More Capital --------------------------------------------------------- Victor Mallet at The Financial Times reports that Spain will force its weaker savings banks to raise more capital or face nationalization in an effort to restore confidence in the Spanish economy. According to the FT, Elena Salgado, finance minister, said the additional capital needed by the Spanish banking system would not exceed EUR20 billion (US$27 billion) -- at the lower end of estimates made by analysts and economists -- and would ideally come from the private sector rather than the state. Spain has already spent EUR15 billion on recapitalizing unlisted cajas, or savings banks, tapping both its Fund for Orderly Bank Restructuring (Frob) and a deposit guarantee fund. The cajas were badly hit by the collapse of the country's housing bubble in 2007, the FT discloses. The FT relates that at a news conference on Monday evening, Ms. Salgado said all Spanish financial institutions would be obliged to have a minimum core capital ratio of 8% of risk- weighted assets. The requirement would be even higher for institutions that are unquoted or have no private investors and depend on wholesale finance markets to fund more than 20% of their assets, the FT states. "We need to guarantee confidence in our financial sector," Ms. Salgado, as cited by the FT, said, adding that the Spanish government wanted to "eliminate any doubt about the solvency of our financial institutions". The FT notes that Ms. Salgado said Spanish institutions, including strong listed banks such as Santander , BBVA and Barcelona's La Caixa savings bank, already had average core capital of 8.5%. Some cajas, however, are well below the minimum and face a forced takeover by the Frob if they fail to raise new capital by September, the FT says. The Frob would take ordinary equity in an institution for a maximum of five years and then seek to sell the shares on to a private sector buyer, according to the FT. ============= U K R A I N E ============= METINVEST BV: Moody's Upgrades Senior Unsecured Rating to 'B2' -------------------------------------------------------------- Moody's upgraded Metinvest's senior unsecured rating to B2, assigned a (P)B2 rating to the proposed MTN programme and the envisaged bond and affirmed the corporate family rating at B2 and the national scale rating at A2.ua. The outlook for all ratings is stable. The affirmation of the rating was driven by the positive performance that Metinvest has shown in the last financial year with Moody's adjusted debt/EBITDA of around 1.6x per the last- twelve-months end of September 2010. Metinvest has achieved this result despite the fact that US$400 million have been paid for acquisitions, which have only been consolidated from December 2010. Based on the capital structure Metinvest is now strongly positioned in its rating category, despite the expected further cash outflow for the acquisition of Ilyich Steel Plant and its additional capital expenditure program. The rating also incorporates Metinvest's ability to generate positive cash flows, even in times of a severe downturn as observed in 2009, its good business profile with vertical integration, its large iron ore reserves as one of the largest producers of iron ore in the world and the geographically advantageous location of some of its major assets. On the negative side the rating takes into account (i) its dependence on highly volatile spot markets for semi-finished steel products, which can lead to significant swings in operating performance through the cycle of evolving and unpredictable business, (ii) the fiscal and legal environment of Ukraine, (iii) its continued weak short term liquidity position (iv) the company's dependence on exports and therefore its exposure to protectionist barriers in some of its export markets, (v) its ambitions to seek further external growth and (vi) possible shareholder friendly actions, such as increasing dividend payouts, given the high degree of shareholder concentration. Despite Metinvest's high degree of exports it still remains subject to trade barriers and other government interference given that most of the company's production facilities are located within the Ukraine. In addition, Moody's has incorporated the fact that Metinvest will have to payout another major amount for the acquisition of additional shares in Ilyich Steel Plant in 2011 as well as the commitment and plans of Metinvest to significantly increase its capital expenditure programs, and the payout of a sizable dividend. According to Moody's forecasts these measures will prevent Metinvest's leverage to improve further and, in addition, will require substantial liquidity reserves, which will be covered to some extent with the recently announced bond issue. Metinvest has already achieved the leverage ratio that Moody's would require for an upgrade to B1 which is outlined as a debt/EBITDA of below 2.0x. However, an upgrade would also require an improvement of the company's short term liquidity situation which is weighing negatively on the company's ratings -- driven by high capex plans and the payout of dividends, although the debt maturity profile will have improved with the issuance of the contemplated bond. Downward pressure on the rating predominantly stems from the relatively weak short term liquidity situation. Downward pressure could also be exerted on the rating as a result of significantly higher leverage caused by an increase in the absolute level of debt, combined with lower cash flow generation leading to a debt/EBITDA ratio sustainably above 2.5x. Failure to keep the current headroom under existing covenants -- contrary to Moody's expectations -- would also result in pressure on the rating. Moody's has now removed the notching between the bond and the corporate family rating reflecting the improved liability structure of the company with a reducing share of secured debt in favour of unsecured debt. This removes the degree of contractual subordination of the outstanding and envisaged bonds vis-a-vis other debtors. Proforma the announced bond issuance, Moody's estimates that between 10 and 13% of Metinvest's indebtedness is secured, which, according to the result of our loss-given-default methodology does not justify any more the one notch difference between the corporate family rating and the senior unsecured rating, hence the upgrade. Upgrades: Issuer: Azovstal Capital B.V. * Senior Unsecured Regular Bond/Debenture, Upgraded to B2, LGD4, 50% from B3, LGD6, 93% * Senior Unsecured Regular Bond/Debenture, Upgraded to B2, LGD4, 50% from B3, LGD6, 93% Issuer: Metinvest B.V. * Senior Unsecured Regular Bond/Debenture, Upgraded to B2, LGD4, 50% from B3, LGD6, 93% * Senior Unsecured Regular Bond/Debenture, Upgraded to B2, LGD4, 50% from B3, LGD6, 93% Assignments: Issuer: Metinvest B.V. * Multiple Seniority Medium-Term Note Program, Assigned (P)B2 * Senior Unsecured Regular Bond/Debenture, Assigned (P)B2 The principal methodologies used in this rating were Global Steel Industry published in January 2009, and Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Metinvest B.V. is a major asset of Ukrainian investment holding company System Capital Management. SCM has a 75% share in Metinvest, the other shareholder is SMART group. Metinvest's major operations are located in the Ukraine and consist of steel production facilities, iron ore and coal mines. It is the largest fully vertically integrated mining and steel business in Ukraine. In the nine months ended 30 September 2010 Metinvest -- inter alia- produced 15.9 million tonnes of merchant iron ore concentrate, and 8.1 million tones of semi-finished and finished steel products and generated turnover of USD 6.8 billion.. Moody's National Scale Ratings are intended as relative measures of creditworthiness among debt issues and issuers within a country, enabling market participants to better differentiate relative risks. NSRs differ from Moody's global scale ratings in that they are not globally comparable with the full universe of Moody's rated entities, but only with NSRs for other rated debt issues and issuers within the same country. NSRs are designated by a ".nn" country modifier signifying the relevant country, as in ".ua." for Ukraine. For further information on Moody's approach to national scale ratings, please refer to Moody's Rating Implementation Guidance published in August 2010 entitled "Mapping Moody's National Scale Ratings to Global Scale Ratings. METINVEST BV: Fitch Rates Proposed USD Notes at 'B' --------------------------------------------------- Fitch Ratings assigned METINVEST B.V.'s proposed issue of USD notes with a maturity of seven to 10 years an expected senior unsecured rating of 'B'. The rating is constrained by Ukraine's sovereign ratings of 'B'/Stable/'B'. The expected Recovery Rating (RR) for the issue is 'RR4'. The final ratings of the issue will be published upon receipt of final documentation materially conforming to the information already received and confirmation of the amount and tenor of the notes. Proceeds from the notes are intended to be used to finance Metinvest's capital expenditure program over the next five years and for general corporate purposes. The terms contained in the draft prospectus state that the notes will rank equally with all other senior, unsubordinated, unconditional and unsecured indebtedness of Metinvest. The notes will initially benefit from guarantees from three operating subsidiaries, with more guarantors to be added at a later date subject to various pre-conditions. Other terms include a negative pledge, change of control language, and a consolidated leverage covenant of less than 3x. Fitch rates Metinvest's Long-term foreign currency Issuer Default (IDR) 'B', Long-term local currency IDR 'B+', and National Long- term 'AA+(ukr)'. All three ratings have Stable Outlooks. Metinvest's Short-term foreign and local currency IDRs are 'B' and the National Short-term rating is 'F1+(ukr)'. The Long-term foreign currency IDR remains constrained by Ukraine's sovereign ratings. Latest 9M10 results for Metinvest showed consolidated revenue of US$6.8 billion, a 55% increase from the same period in 2009, due to a recovery in the global steel and mining markets. The company reported an EBITDAR margin of 28.4% (Q309: 24.3%). =========================== U N I T E D K I N G D O M =========================== BLADE TOOLING: KPMG Closes Deal With Gardner Group, Saves 60 Jobs ----------------------------------------------------------------- inAudit reports that administrators KPMG has finally found a buyer for Blade Tooling and Blade Technology. As reported in the Troubled Company Reporter-Latin America on December 28, 2010, BBC News said that Blade Tooling Company Limited and Blade Technology have gone into administration as a result of "tough" trading conditions. BBC related that Will Wright and Mark Orton of KPMG were appointed joint administrators on December 23. Gardner Group Ltd of Ilkeston, Derbyshire, made a final decision on January 21 to buy out the aerospace firms through the funds advanced by Better Capital Limited, according to inAudit. The acquisition, inAudit notes, will convert the name of the aerospace firms into Gardner Blade, covering only select assets and businesses of the firms and saving 60 jobs in both companies. Five redundancies have been declared in the Blade Tooling facility by KPMG administrators Will Wright and Mark Orton as the aerospace firm was trading while buyers were sought, the report says. inAudit discloses that the acquisition is believed to be valued at GBP3 million, 25% from the current cash reserves of Gardner while the 75% comes from Better Capital Fund which initially announced February 2010 to invest GBP20 million in Gardner. Gardner Group operates independently across the United Kingdom supplying metallic aerospace parts and sub-assemblies. Worcestershire-based Blade Tooling Company Limited and Blade Technology are aerospace industry suppliers. ESTATES & GENERAL: Placed in Voluntary Liquidation -------------------------------------------------- James Whitmore at PropertyWeek.com reports that Estates & General, a small property company controlled by Leo Noe's family trust, was placed in voluntary liquidation on January 21, 2011. According to PropertyWeek.com, the move came after Estates & General's adviser F&C Reit, which is chaired by Mr. Noe, failed to reach agreement with all bondholders on a restructuring. PropertyWeek.com discloses that the company owns around GBP20 million of properties and has debt of GBP19.9 million, held in two high-interest bonds -- a GBP3 million debenture with a coupon of 12.4% and a 11.25% debenture with a coupon of 11.25%. PropertyWeek.com relates that Estates & General announced two years ago that the bonds were in default. In December last year, it appointed Begbies Traynor to conduct an independent business review of the company, which has led to the voluntary liquidation. Interest payments due on the bonds on December 31 and payable by January 14 were not made, PropertyWeek.com notes. PropertyWeek.com reports that a restructuring of Brightsea EOL, another company controlled by the Noe family trusts' Trafalgar, has been achieved, and one for Ashpol is close to be secured. However, a third company, Pinton Estates, went into receivership in May 2009, PropertyWeek.com says. The companies were bought or created by Mr. Noe between 1999 and 2004, when he bought four portfolios with high-interest debentures attached. Estates & General was a listed company that Mr. Noe bought in 2004 for GBP71 million. FURNITURE TODAY: In Creditors Voluntary Liquidation --------------------------------------------------- EssexEcho reports that Furniture Today and Mirrors Today have gone into creditors' voluntary liquidation. EssexEcho says insolvency firm David Rubins and Partners LLP had warned customers they won't receive their goods and will have to claim their money back. Essex County Council Trading Standards has advised people to contact their banks to try to get a refund, EssexEcho says. EssexEcho quoted Stephen Katz, partner at David Rubin and Partners, as saying that "The business has in the region of 3,000 creditors, the majority of whom have used credit and debit cards to pay for their goods." A Law Society meeting is planned for February 14 when it is expected the company will be put into liquidation, EssexEcho adds. Furniture Today is a furniture firm. The company, which is part of Futurelook, operated from an office in Manor House, Basildon. LEAMINGTON DESSERTS: Administrators Close Factory, Axes 160 Jobs ---------------------------------------------------------------- Elaine Watson at foodmanufacture.co.uk reports that administrators have closed the Leamington Desserts Limited frozen desserts factory in Leamington Spa with the loss of more than 160 jobs after failing to sell it as a going concern. As reported in the Troubled Company Reporter-Latin America on December 3, 2010, Business Credit Management said that Will Wright and Mark Orton from KPMG Restructuring in Birmingham were appointed joint administrators to Leamington Desserts on November 30, 2010. According to Business Credit Management, Mr. Wright said: "The Leamington factory has been loss making for some time and this has resulted in our appointment. Over the next few days we will be seeking to stabilize the business and begin seeking a going concern sale." Will Wright, joint administrator from KPMG, told foodManufacture.co.uk in an interview that he had been in talks with interested parties for some weeks but had not received a viable offer for the company, which makes own-label frozen desserts for supermarkets and caterers. Foodmanufacture.co.uk discloses that 161 of the 166 staff at the site have been made redundant, except five that have been retained to help with the orderly wind down of the business. Leamington Desserts Limited is a subsidiary of Polestar Foods Limited. Both Polestar Foods Limited and its Devon-based subsidiary, Okehampton Desserts Limited, continue to trade as normal and are unaffected by the administration. The business manufactures frozen desserts for major supermarkets and employs 166 people at its site in Leamington Spa, Warwickshire. WAKEFIELD TRINITY: Faces Administration on Unpaid Taxes ------------------------------------------------------- Andy Wilson at guardian.co.uk reports that Wakefield Trinity have had approaches from four potential buyers since they were served with a third winding-up order for unpaid taxes, although they concede that any takeover deal is unlikely to come quickly enough to avert a move into administration. That would be a blow to Wakefield Trinity's fading hopes of securing the license necessary to preserve their stay in the Super League beyond the end of this season, although the embarrassing prospect that they might not make the 2011 kick-off in Cardiff next month now seems to be fading, according to guardian.co.uk. Guardian.co.uk discloses that James Elston, the former Dewsbury hooker who has turned to firefighting since being appointed Wakefield's chief executive last year, conceded that Wakefield Trinity would be a more attractive proposition if and when administrators are appointed to tackle debts that run well into six figures -- including around GBP300,000 in unpaid VAT and National Insurance that led to the latest winding-up order from HM Revenue & Customs, which is due to be heard at the high court on February 2. Mr. Elston, guardian.co.uk notes, insisted that they still plan to apply for a new license to play in the Super League from 2012, as all clubs are required to do, even though at this stage they do not have a stadium after their plans for a new development at Newmarket were recently called in for a public inquiry. Wakefield Trinity is banned from signing players because of its financial predicament, but after a meeting with Rugby Football League officials in Leeds, Mr. Elston hopes that they will be given permission to make the loan signings that are desperately needed before they start the season with a derby against Castleford as part of the Millennium Magic weekend on February 12, the report adds. Wakefield Trinity is part of the Super League club. * UK: Business Insolvencies Down 18% in 2010, Experian Says ----------------------------------------------------------- Scott Hamilton at Bloomberg News reports that Experian Plc said the annual rate of U.K. business insolvencies fell in 2010 for the first time in two years as companies' financial positions improved. According to Bloomberg, Experian said in a report released by e- mail on Jan. 24 in Nottingham, England that insolvencies declined 18% to 19,946 from 24,209 the previous year. The proportion of companies that failed decreased to 1.04% from 1.25% in 2009, Bloomberg notes. * UK: Begbies Traynor Expects 10% Rise in Insolvencies in 2011 -------------------------------------------------------------- According to BBC News, research suggests that more UK firms are experiencing serious financial difficulties than at any time in almost two years. BBC relates that insolvency specialist Begbies Traynor said that almost 148,000 firms had serious problems in the final three months of last year, the first year-on-year rise in the past seven quarters. BBC relates that Begbies said government cuts were exacerbating the problem. The report forecast a 10% rise in insolvencies in 2011, which would lead to 23,500 firms being affected, BBC notes. Compared with the July to September quarter, there was an increase of 20% in the number of companies experiencing "significant" or "critical" financial problems, BBC discloses. Begbies, as cited by BBC, said there were "real signs of distress" among UK firms. It said those with critical problems owe more than GBP52.7 billion to creditors and suppliers, less than the GBP57.5 billion owed during the previous quarter, BBC notes. According to BBC, Ric Traynor, chairman of Begbies Traynor, said that retail firms would come under increased pressure as disposable incomes were hit by higher inflation, tax rises and job cuts. Mr. Traynor, as cited by BBC, said sectors exposed to discretionary spending would, therefore, see "an increase in business failures." Begbies forecast that across all sectors, increasing financial distress was likely to lead to about 23,500 formal insolvencies in 2011, a 10% increase on the 21,500 firms that went insolvent last year, BBC discloses. In 2010, there were 15% fewer insolvencies that in 2009, BBC states. "For smaller businesses, we are entering the darkest hour before the dawn, as they face the dual challenges of weak domestic demand and greater pressure from larger competitors and business customers looking to preserve their own profitability," BBC quoted Mr. Traynor as saying. ********* 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 U. Pascual, Marites O. Claro, Rousel Elaine T. Fernandez, Joy A. Agravante, Ivy B. Magdadaro, Frauline S. Abangan and Peter A. Chapman, Editors. Copyright 2011. 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. 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