/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/120614.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, June 14, 2012, Vol. 13, No. 118 Headlines C Y P R U S * CYPRUS: Moody's Downgrades Deposit Ratings on Three Banks F R A N C E SEAFRANCE: Paris Court Accepts Eurotunnel's Acquisition Offer G E R M A N Y SOLARWATT AG: Files for Insolvency; Seeks Reorganization I C E L A N D KAUPTHING BANK: Composition Deal with Creditors to Push Through I R E L A N D CORNERSTONE TITAN 2007-1: S&P Cuts Rating on Class E Notes to 'D' I T A L Y * ITALY: May Need Financial Rescue, Austria's Fin. Minister Says N E T H E R L A N D S DOLPHIN MASTER 0-2007-1: S&P Cuts Rating on Class D Notes to BB- S P A I N BBVA RMBS: Moody's Assigns 'B1' Rating to EUR77MM C Note REPSOL SA: Moody's Downgrades Preferred Stock Rating to 'Ba2' TDA SA NOSTRA: S&P Withdraws 'B' Ratings on Two Note Classes * SPAIN: Can Use EU Bailout Funds to Fix Banking System S W E D E N SAAB AUTOMOBILE: Chinese-Japanese Group Agree to Buy Company U N I T E D K I N G D O M ELLI INVESTMENTS: Moody's Assigns 'B2' CFR/PDR; Outlook Stable LOLA CARS: Rotary Supercars Prepares Takeover Bid MONDRIAN INVESTMENT: Moody's Affirms 'Ba2' CFR; Outlook Stable RANGERS FC: Faces Liquidation; HMRC Rejects Green's Proposals TUCAN CLAIMS: In Administration; 15 Jobs Affected X X X X X X X X * Upcoming Meetings, Conferences and Seminars ********* =========== C Y P R U S =========== * CYPRUS: Moody's Downgrades Deposit Ratings on Three Banks ----------------------------------------------------------- Moody's Investors Service has taken actions on three Cypriot banks to reflect the increased risk of a Greek exit from the euro area. Moody's says that the banks' extensive operations in Greece render their capital positions vulnerable to such an event. Moody's has taken the following rating actions: - Bank of Cyprus (BoC): The deposit and senior unsecured debt ratings were downgraded by one notch to B2 from B1, and the standalone credit assessment lowered to b3 from b2 (within the E+ bank financial strength rating). The bank's ratings were placed on review for downgrade. - Hellenic Bank Ltd (Hellenic): The deposit ratings were downgraded by one notch to B1 from Ba3 and the standalone credit assessment lowered to b2 from b1 (within the E+ BFSR range). The bank's ratings were placed on review for downgrade. - Cyprus Popular Bank (CPB): The bank's B3 senior unsecured debt and deposit ratings were placed on review for downgrade. Moody's will also re-assess the bank's standalone credit assessment of caa1 (mapped from its E BFSR) during the review period. Ratings Rationale The actions on the Cypriot banks primarily reflect Moody's view, as expressed on June 1, 2012, of the increased risk of Greece exiting the euro area. Although a Greek exit is not Moody's central scenario, the rating agency says that it considers the risk of a euro exit by Greece as substantial and recognizes that the probability of such an outcome may increase further following the Greek parliamentary elections on June 17. The rated Cypriot banks maintain extensive branch operations in Greece, with exposures to Greek borrowers amounting to 42% of net loans for CPB, to 34% of gross loans for BoC, and 17% of gross loans for Hellenic. As such, their capital positions remain susceptible to the direct and indirect consequences of a Greek exit. The heightened risk of a euro exit could lead to an acceleration in deposit outflows from Cypriot banks' Greek branches, pressuring liquidity, whilst a euro area exit -- triggering currency redenomination, a likely sovereign default and widespread economic stresses -- would materially weaken the banks' solvency. The downgrades incorporate the impact of the increased risk of a Greek exit in the Cypriot banks' ratings and reflect, on a relative basis, BoC's sizable and Hellenic's moderate exposures to the Greek operating environment. CPB's ratings incorporate the severe solvency and liquidity risks that the bank faces. RISK OF A GREEK EXIT FROM THE EURO AREA Over the last 15 months, aggregate deposit outflows from rated Cypriot banks' Greek branches amounted to 27%, roughly in line with the decline in the Greek banking system's deposits. As a result of the outflows, Moody's notes that the banks' Greek operations are increasingly funded by the Cypriot banks' headquarters. The increased risk of a euro exit by Greece augments the potential for an acceleration in deposit outflows that would erode the banks' liquidity cushions and expose the banks' capital to sizable losses in the event of an exit. In an exit scenario, the banks' already weakened capital buffers would be further eroded by (i) the redenomination/devaluation loss on the difference between banks' Greek assets and Greek liabilities (the 'funding gap'); (ii) losses on the banks' holdings of post debt-exchange Greek government bonds (GGBs) from a likely sovereign default; and (iii) the accelerated provisioning needs generated by a sharp deterioration in asset quality. Impact of the funding gap As of March 2012, the funding gap from the banks' branch operations in Greece amounted to 125% of CPB's core Tier 1 capital -- pro forma figures for core Tier 1, incorporating the EUR1.8 billion capital increase that the government of Cyprus has fully underwritten -- 67% of BoC's core Tier 1 capital--excluding the bank's Convertible Enhanced Capital Securities (CECS)-- and 21% of Hellenic's. The corresponding loss from redenomination/devaluation in an exit scenario would be significant, leading to reductions in the banks' capital positions. Impact on the banks' GGB holdings An exit would also result in losses on the banks' holdings of post debt-exchange Greek government debt. As of March, these securities accounted for 19% of CPB's pro forma core Tier 1, 15% of BoC's and 2% of Hellenic's. Impact on asset quality The acute dislocations in the real economy in Greece following an exit, including a potential standstill in the Greek payment system, would likely accelerate losses on the banks' Greek loan books. In addition, the negative knock-on effects for the Cypriot operating environment would also lead to deterioration in Cypriot loan books beyond Moody's current expectations. CYPRUS POPULAR BANK (CPB) CBP has the largest exposure to the Greek operating environment and the weakest liquidity position amongst the rated Cypriot banks. However, Moody's notes that the bank's stand-alone ratings incorporate the severe solvency and liquidity risks that the bank faces, which are partially mitigated by the government's commitment to restore the bank's solvency. SYSTEMIC SUPPORT EMBEDDED IN DEBT AND DEPOSIT RATINGS The three rated Cypriot banks' debt and deposit ratings all continue to benefit from one notch of uplift, reflecting Moody's view of the balance between (i) the constrained domestic capacity of the Cypriot government to provide support to the banking system, if needed; and (ii) the additional resources that could potentially be made available to Cyprus in the context of its membership in the European Monetary Union. FACTORS TO BE CONSIDERED DURING THE REVIEW The review will primarily focus on developments in Greece and how these developments may translate into heightened risks for Cypriot banks' solvency and liquidity, as well as contingency measures that the banks and the government of Cyprus are considering to mitigate these risks. The political situation in Greece remains very fluid and Moody's considers that following the Greek parliamentary elections on June 17, the risk of euro exit by Greece may increase further. As part of the review, Moody's will also assess the implementation of the banks' current recapitalization plans and efforts by the government to seek external funding from the euro area to provide capital support to the banking sector. WHAT COULD MOVE THE RATINGS DOWN/UP An increase in the likelihood of an exit by Greece from the euro area would exert downward pressure on the ratings of the three banks. Mounting asset-quality deterioration or rapidly deteriorating funding and liquidity positions would also exert downward pressure on the ratings. Lack of credible contingency plans to inject capital into the banking system would also exert downward pressure on the ratings. As indicated by the review for downgrade, upward rating pressure is unlikely in the near term unless the operating environments in the banks' key markets of Cyprus and Greece improve materially or their capital bases are strengthened materially to levels sufficient to withstand a potential Greek exit. LIST OF AFFECTED RATINGS Bank of Cyprus Public Co Ltd: - Deposit and senior unsecured debt ratings downgraded to B2/Not-Prime from B1/Not-Prime - Subordinated debt rating downgraded to (P)Caa1 from (P)B3 - Junior subordinated notes rating downgraded to (P)Caa2 from (P)Caa1 - Standalone BFSR affirmed at E+ (now mapping to b3 from b2) - All ratings are on review for downgrade Cyprus Popular Bank Public Co Ltd: - B3/Not-Prime deposit and senior unsecured debt ratings are placed on review for downgrade - Subordinated debt rating is affirmed at Ca with developing outlook - Standalone BFSR affirmed at E/caa1; No outlook is assigned on the E BFSR Egnatia Finance plc (the funding subsidiary of Cyprus Popular Bank): - Senior unsecured debt ratings of (P)B3 are placed on review for downgrade - Subordinated debt rating of (P)Ca is affirmed with developing outlook Hellenic Bank Public Co Ltd: - Deposit ratings downgraded to B1/Not-Prime from Ba3/Not-Prime - Greek branch ratings downgraded to Caa2/Not-Prime from B1/Not- Prime - Standalone BFSR affirmed at E+ (now mapping to b2 from b1) - Caa2 Greek branch deposit ratings carry a negative outlook; All ratings except the Not Prime short term ratings are on review for downgrade The methodologies used in these ratings were Bank Financial Strength Ratings: Global Methodology published in February 2007, and Incorporation of Joint-Default Analysis into Moody's Bank Ratings: Global Methodology published in March 2012. As of March 2012, Bank of Cyprus had total assets of EUR38.6 billion, Cyprus Popular Bank EUR31.8 billion and Hellenic Bank EUR8.6 billion. All three banks are headquartered in Nicosia, Cyprus. =========== F R A N C E =========== SEAFRANCE: Paris Court Accepts Eurotunnel's Acquisition Offer ------------------------------------------------------------- The Paris Commercial Court decided on June 11 to accept the offer made by Eurotunnel following the administration of the SeaFrance group, announced on January 9, 2012. Groupe Eurotunnel offered EUR65 million to acquire three ships, The Berlioz, The Rodin and The Nord-Pas-de-Calais, along with their related assets. The acquisition will be made via an ad-hoc financial vehicle owned by the group and named Eurotransmanche. It will be open to the local authorities and will lease the ferries to an operating company. This company, independent of Eurotunnel, will be able to create 500 jobs in the Calais region and about a hundred in the UK. The ferries will need a technical overhaul before being brought into commercial service, as SeaFrance was unable to complete necessary maintenance work before being placed into administration. Jacques Gounon, Chairman and Chief Executive Officer of Groupe Eurotunnel, stated: "I am delighted that the pragmatic approach taken by Eurotunnel has convinced the Commercial Court. This will aid economic development and will further support the transport of people and goods between the continent and Great Britain". SeaFrance is the operator of the undersea rail link between Britain and continental Europe. ============= G E R M A N Y ============= SOLARWATT AG: Files for Insolvency; Seeks Reorganization -------------------------------------------------------- Becky Beetz and Petra Hannen at PV Magazine reports that Solarwatt AG has officially filed for insolvency at the District Court of Dresden. According to PV Magazine, the company is looking to reorganize itself through self-administration. On May 11, Solarwatt announced that company founder, Frank Schneider would leave the company at the end of the year,PV Magazine relates. With immediate effect, he handed his chief executive position to Detlef Neuhaus, who was previously responsible for marketing and distribution, PV Magazine notes. CFO, Juergen Bruns will also leave the company on June 30, PV Magazine discloses. His successor is Carsten Bovenschen, who until the end of 2010, was CFO at Roth & Rau, PV Magazine says. Bloomberg News' Mariajose Vera relates that Solarwatt filed for insolvency due to threatening inability to pay its debts and excessive indebtedness. Solarwatt AG is a based in Dresden. ============= I C E L A N D ============= KAUPTHING BANK: Composition Deal with Creditors to Push Through --------------------------------------------------------------- Omar R. Valdimarsson at Bloomberg News reports that Feldis Lilja Oskarsdottir, member of Kaupthing Bank hf's winding up committee, said the failed Icelandic lender is set to proceed with a composition agreement with its creditors. "Multiple alternative structures including bankruptcy have been investigated," Bloomberg quotes Ms. Oskarsdottir as saying in an e-mailed response to questions. "After extensive discussions with Kaupthing's Informal Creditors Committee and large creditors, Kaupthing received firm feedback to proceed to prompt composition." Ms. Oskarsdottir said that any agreement must be approved by a majority of Kaupthing's claimants, both in number and the value of their claims, as well as the district court in Reykjavik, Bloomberg notes. Kaupthing has EUR5.2 billion (US$6.5 billion) in assets and EUR17 billion in claims, Bloomberg relates. The winding up committee said that a composition could be reached as soon as the third quarter, making the lender a holding company controlled by its creditors, Bloomberg notes. Creditors holding valid priority claims would be paid in full while secured claims will get paid from the collateral used to secure the claim, Bloomberg says. The committee said that general claimants would be subject to the terms of the composition, according to Bloomberg. About Kaupthing Bank Headquartered in Reykjavik, Kaupthing Bank -- http://www.kaupthing.com/-- is Iceland's largest bank and among the Nordic region's 10 largest banking groups. With operations in more than a dozen countries, the bank offers a range of services including retail banking, corporate finance, asset management, brokerage, private banking, treasury, and private wealth management. Kaupthing was created by the 2003 merger of Bunadarbanki and Kaupthing Bank. In October 2008, the Icelandic government assumed control of Kaupthing Bank after taking similar measures with rivals Landsbanki and Glitnir. As reported by the Troubled Company Reporter-Europe, on Nov. 30, 2008, Olafur Gardasson, assistant for Kaupthing Bank hf, filed a petition under Chapter 15 of title 11 of the United States Code in the United States Bankruptcy Court for the Southern District of New York commencing the Debtor's Chapter 15 case ancillary to the Icelandic Proceeding and seeking recognition for the Icelandic Proceeding as a "foreign main proceeding" under the Bankruptcy Code and relief in aid of the Icelandic Proceeding. ============= I R E L A N D ============= CORNERSTONE TITAN 2007-1: S&P Cuts Rating on Class E Notes to 'D' ----------------------------------------------------------------- Standard & Poor's Ratings Services lowered its credit ratings on Cornerstone Titan 2007-1 PLC's class D and E notes. The ratings on the other classes are unaffected by the rating actions. "The downgrades follow the interest shortfall that occurred on the class E notes on the April 2012 payment date, and our assessment of the issuer's ability to pay interest on the notes," S&P said. "As reflected in the April 2012 cash manager report, the class E, F, and G notes have deferred unpaid interest. We do not rate the class F and G notes," S&P said. "The class E notes, which in our view are highly exposed to principal losses, failed to receive full interest payment on the April 2012 payment date. Therefore, we have lowered our rating on the class E notes to 'D (sf)' from 'CCC+ (sf)'," S&P said. "In view of impending lease rollovers and an increased number of specially serviced loans, we believe that this could have a near- term impact on income that would exacerbate the size of these interest shortfalls in the next 12 months. As a consequence, our analysis indicates that the class D notes may be at risk of suffering interest shortfalls (absent other mitigating factors). We have therefore lowered our rating on the class D notes to 'B- (sf)' from 'BB- (sf)'," S&P said. "We understand that the excess spread, which is distributed to the class X notes, is not available in this transaction to mitigate interest shortfalls under the rest of the notes. In this transaction, the issuer relies on servicer advances to address timely payment of interest on the notes," S&P said. However, under the transaction documents, the back-up advancer is not allowed to make servicing advances to cover interest shortfalls under the notes, if such shortfalls have resulted from: Extraordinary expenses payable to the transaction parties (e.g., special servicing fees); or The reduction of servicing advances, if required to meet interest shortfalls under any of the loans, following the determination of an appraisal reduction amount (the appraisal reduction mechanism was structured to prevent drawings on the portion of the securitized loans that represents more than 90% of the securitized loan). "The rating actions have not resulted from a change in our opinion on the creditworthiness of the remaining pool of loans backing the transaction. However, the class E notes experienced an interest shortfall, and we believe that the class D notes have become more vulnerable to interest shortfalls. Our ratings in this transaction address timely payment of interest, payable quarterly in arrears, and payment of principal not later than the legal final maturity date (in January 2017)," S&P said. "Cornerstone Titan 2007-1 closed in March 2007 with a note balance of EUR1,321.9 million. The underlying pool initially held 32 loans secured on real estate assets in Germany, the Netherlands, Switzerland, France, and Poland. On the most recent note interest payment date, in April 2012, 22 loans remained outstanding and the outstanding note balance was EUR961.1 million," S&P said. POTENTIAL EFFECTS OF PROPOSED CRITERIA CHANGES "We have taken the rating actions based on our criteria for rating European commercial mortgage-backed securities (CMBS). However, these criteria are under review," S&P said. "As highlighted in the Nov. 8 Advance Notice Of Proposed Criteria Change, our review may result in changes to the methodology and assumptions we use when rating European CMBS, and consequently, it may affect both new and outstanding ratings on European CMBS transactions," S&P said. "On June 4, we published a request for comment (RFC) outlining our proposed criteria changes for CMBS Global Property Evaluation Methodology. The proposed criteria do not significantly change Standard & Poor's longstanding approach to deriving property net cash flow (S&P NCF) and value (S&P Value). We therefore anticipate very limited impact for European outstanding ratings when the updated CMBS Global Property Evaluation Methodology criteria are finalized," S&P said. "However, because of its global scope, the proposed CMBS Global Property Evaluation Methodology does not include market-specific parameters for cash flow adjustments to the various line items. An application of these criteria to European transactions will therefore be published when we release our updated rating criteria," S&P said. "Until such time that we adopt new criteria for rating European CMBS, we will continue to rate and monitor these transactions using our existing criteria," S&P said. STANDARD & POOR'S 17G-7 DISCLOSURE REPORT SEC Rule 17g-7 requires an NRSRO, for any report accompanying a credit rating relating to an asset-backed security as defined in the Rule, to include a description of the representations, warranties and enforcement mechanisms available to investors and a description of how they differ from the representations, warranties and enforcement mechanisms in issuances of similar securities. The Rule applies to in-scope securities initially rated (including preliminary ratings) on or after Sept. 26, 2011. If applicable, the Standard & Poor's 17g-7 Disclosure Reports included in this credit rating report are available at: http://standardandpoorsdisclosure-17g7.com RATINGS LIST Class Rating To From Cornerstone Titan 2007-1 PLC EUR1.322 Billion Commercial Mortgage-Backed Floating-Rate Notes Ratings Lowered D B- (sf) BB- (sf) E D (sf) CCC+ (sf) Ratings Unaffected A1 A+ (sf)/Watch Neg A2 A+ (sf)/Watch Neg B A- (sf) C BBB+ (sf) ========= I T A L Y ========= * ITALY: May Need Financial Rescue, Austria's Fin. Minister Says ---------------------------------------------------------------- Michael Shields and Steve Scherer at Reuters report that raising the stakes in Europe's debt crisis, Austria's finance minister said Italy may need a financial rescue because of its high borrowing costs, drawing a sharp denial on Tuesday from the Italian prime minister. According to Reuters, Maria Fekter's assessment of the euro zone's third largest economy stoked investors' fears that Europe is far from ending 2-1/2 years of turmoil -- a feeling reinforced by Dutch Finance Minister Jan Kees de Jager, who said the euro zone was "still far from stable". A deal by euro zone finance ministers on Saturday to lend Spain up to EUR100 billion (GBP80 billion) to recapitalize its banks was seen by many in the markets as yet another sticking plaster, Reuters notes. Spanish 10-year bond government yields soared to 6.81%, their highest level since the euro's launch in 1999, Reuters discloses. Reuters relates that Ms. Fekter said in a television interview on Monday night euro zone rescue funds, already stretched by supporting Greece, Portugal, Ireland and soon Spain, might be insufficient to cope with Italy as well. "Italy has to work its way out of its economic dilemma of very high deficits and debt, but of course it may be that, given the high rates Italy pays to refinance on markets, they too will need support," Reuters quotes Ms. Fekter as saying. She sought to soften her remarks on Tuesday, saying she had no indication Italy planned to apply for aid, Reuters notes. According to Reuters, Italian Prime Minister Mario Monti, asked by a German television network whether his country would need a bailout, said: "I don't believe so." Earlier, he called Fekter's comments "completely inappropriate" for an EU finance minister, Reuters relates. Euro zone officials said they were deeply unhelpful, according to Reuters. Ms. Fekter's typically outspoken comments came after Italy's industry minister dismissed the idea that Rome may need external help, saying reforms adopted by his government so far had put the Italian economy on a sound footing, Reuters discloses. According to Reuters, her concerns are shared by one of the German government's council of economic advisers, Lars Feld, who told Reuters that Italy could be next in line. "Overcoming the troubles in Spain will bring calm to the markets for a while, but the chances are not so small that Italy may also come under fire, in particular as the promised labor market reform has turned out to be less ambitious," Mr. Feld, as cited by Reuters, said. ===================== N E T H E R L A N D S ===================== DOLPHIN MASTER 0-2007-1: S&P Cuts Rating on Class D Notes to BB- ---------------------------------------------------------------- Standard & Poor's Ratings Services lowered its credit ratings on all of the outstanding class D notes in the Dolphin Master Issuer B.V. program. "At the same time, we have affirmed our ratings on all of the other outstanding classes of notes in the program," S&P said. "Dolphin Master Issuer is a multiple-issuance Dutch residential mortgage-backed securities (RMBS) program with an ongoing revolving period. There have been 10 issuances from the program," S&P said. The collateral backing the Dolphin Master Issuer notes comprises Dutch mortgage loans originated by ABN AMRO Bank N.V., Direktbank N.V., Oosteroever Hypotheken B.V., Quion 9 B.V., and their immediate predecessors. "The rating actions follow our credit and cash flow analysis of the most recent transaction information that we have received on the program (as of March 2012)," S&P said. "The program's collateral pool performance has been stable in the past two years, with total delinquencies well below our Dutch RMBS index. The reserve fund is at the level required by the transaction documents, and has never been drawn since the program's establishment," S&P said. "Continued house price declines have resulted in an increase in our weighted-average foreclosure frequency (WAFF) and weighted- average loss severity (WALS) for the program's collateral pool. Additionally, we have made qualitative adjustments in our credit analysis, to reflect lower levels of certainty over valuations for some properties eligible for, or already in, the Dolphin Master Issuer program," S&P said. "The results of our cash flow analysis indicate that due to a condition allowing redemption of mezzanine and junior classes of notes at par less the principal deficiency ledger amount, combined with our increased WAFF and WALS, the class D notes in the program are unable to maintain the ratings that we previously assigned. Therefore, we have lowered our ratings on all of the outstanding class D notes in the Dolphin Master Issuer program," S&P said. "According to our credit and cash flow analysis, the credit enhancement available to all of the other outstanding notes in the program--the class A, B, and C notes--is sufficient to support our current ratings. Therefore, we have affirmed our ratings on all outstanding class A, B, and C notes in the Dolphin Master Issuer program," S&P said. CREDIT STABILITY "Our credit stability analysis indicates that the maximum projected deterioration that we would expect at each rating level, for time horizons of one year and three years, under moderate stress conditions, are in line with our 2010 credit stability criteria," S&P said. STANDARD & POOR'S 17G-7 DISCLOSURE REPORT SEC Rule 17g-7 requires an NRSRO, for any report accompanying a credit rating relating to an asset-backed security as defined in the Rule, to include a description of the representations, warranties and enforcement mechanisms available to investors and a description of how they differ from the representations, warranties and enforcement mechanisms in issuances of similar securities. The Rule applies to in-scope securities initially rated (including preliminary ratings) on or after Sept. 26, 2011. If applicable, the Standard & Poor's 17g-7 Disclosure Reports included in this credit rating report are available at: http://standardandpoorsdisclosure-17g7.com RATINGS LIST Class Rating To From Dolphin Master Issuer B.V. (Series 0-2007-I) EUR4.036 Billion Floating Rate Notes Series 0-2007-1 Ratings Affirmed A AAA (sf) B AA (sf) C A (sf) Rating Lowered D BB- (sf) BBB (sf) Dolphin Master Issuer B.V. (Series 0-2008-I) EUR7.366 Billion Mortgage-Backed Floating Rate Notes Series 0-2008-1 Ratings Affirmed A AAA (sf) B AA (sf) C A (sf) Rating Lowered D BB- (sf) BBB (sf) Dolphin Master Issuer B.V. (0-2009-II) EUR3.949 Billion Floating Rate Notes Series 0-2009-II Ratings Affirmed A AAA (sf) B AA (sf) C A (sf) Rating Lowered D BB- (sf) BBB (sf) Dolphin Master Issuer B.V. (Series 2010-1) EUR7.897 Billion Mortgage-Backed Floating Rate Notes Series 2010-1 Ratings Affirmed A1 AAA (sf) A2 AAA (sf) A3 AAA (sf) A4 AAA (sf) B AA (sf) C A (sf) Rating Lowered D BB- (sf) BBB (sf) Dolphin Master Issuer B.V. (Series 2010-2) EUR4 Billion Residential Mortgage-Backed Floating Rate Notes Series 2010-2 Ratings Affirmed A1 AAA (sf) A2 AAA (sf) Dolphin Master Issuer B.V. (Series 2010-4) EUR7.1 Billion Mortgage-Backed Floating Rate Notes due Sep 2099 Series 2010-4 Ratings Affirmed A AAA (sf) B AA (sf) C A (sf) Rating Lowered D BB- (sf) BBB (sf) Dolphin Master Issuer B.V. (Series 2011-1) EUR500 Million Mortgage-Backed Floating Rate Notes Series 2011-1 Rating Affirmed A AAA (sf) ========= S P A I N ========= BBVA RMBS: Moody's Assigns 'B1' Rating to EUR77MM C Note -------------------------------------------------------- Moody's Investors Service has assigned the following definitive ratings to the debt issued by BBVA RMBS 11, Fondo de Titulizacion de Activos: EUR1,204M A Note, Definitive Rating Assigned Aa2 (sf) EUR119.0M B Note, Definitive Rating Assigned Ba1 (sf) EUR77.0M C Note, Definitive Rating Assigned B1 (sf) The transaction represents the eleventh residential mortgage securitization transaction originated by Banco Bilbao Vizcaya Argentaria ("BBVA") (A3/P-2). The assets supporting the notes, which amount to around EUR 1,400 million, consists of mortgage loans extended to individuals and are backed by first economic lien on residential properties located in Spain. BBVA is acting as Servicer of the loans while Europea de Titulizacion S.G.F.T., S.A. is the Management Company ("Gestora"). Ratings Rationale The ratings of the notes take into account the credit quality of the underlying mortgage loan pool and the vintage data for defaults and recoveries received from the originator from which Moody's determined the MILAN Aaa Credit Enhancement and the portfolio expected loss. The expected portfolio loss of 7% of original balance of the portfolio at closing and the MILAN Aaa required credit enhancement of 21% served as input parameters for Moody's cash flow model, which is based on a probabilistic lognormal distribution as described in the report Testing Structural Features with the MARCO Model (Moody's Analyser of Residential Cash Flows) published in January 2006. The key drivers for the MILAN Aaa Credit Enhancement number, which is in line than the Spanish High Loan-to-Value ("HLTV") RMBS sector, takes into account (i) the weighted-average current LTV of 86.92% which is significantly higher than the market average as only mortgage loans with a current LTV above 80% have been selected; (ii) 20.9% of the pool corresponds to loans originated via brokers (iii) 86.9% of the portfolio can modify the amortization profile and request a final payment at maturity which can vary between 10% and 30% of the initial loan amount and (iv) the quality of historical information provided by the originator. The MILAN number has been qualitatively adjusted in order generate a loss distribution with a certain volatility to account for a higher probability of "fat tail" events with respect to the losses. The key drivers for the portfolio expected loss, which is higher than the Spanish sector average, is based on Moody's assessment of the lifetime loss expectation for the pool taking into account (i) the historical performance of loans originated by BBVA; (ii) benchmarking with comparable transactions in the Spanish market; and (iii) the negative outlook Moody's has on Spanish RMBS. The Notes benefit from (i) a reserve fund fully funded upfront equal to 12.75% of the Notes to cover potential shortfall in interest and principal, (ii) a liquidity reserve for Class A upfront equal to 3% of the Notes to cover potential shortfall in interest during the life of the deal and available for principal at the end of the deal. Interest rate risk in the transaction, generated by the reset timing mismatches and, to a limited extent, by base rate mismatches between interest paid by the loans (99% linked to the 12-months EURIBOR) and the 3-months EURIBOR linked interest payable on the notes, is un-hedged. Moody's has haircut the available interest in order to take into account such assets- liability mismatches. The V Score for this transaction is Medium, which is in line with the V score assigned for the Spanish RMBS sector. Four sub components underlying the V Score have been assessed higher than the average for the Spanish RMBS sector. Sector's Historical Downgrade Rate is medium because High LTV deals have shown worse performance than the market index. Issuer/Sponsor/Originator's Historical Performance Variability is assessed as Medium/High because recent HLTV deals from BBVA show worse recovery than other originators in Spain within this segment, and the Sovereign risk may increase performance volatility. Transaction Complexity is Medium because HLTV pools are more exposed to higher house price declines. Analytic complexity is assessed as Medium because there is no hedging for the interest rate risk. Moody's Parameter Sensitivities provide a quantitative/model- indicated calculation of the number of rating notches that a Moody's structured finance security may vary if certain input parameters used in the initial rating process differed. The analysis assumes that the deal has not aged and is not intended to measure how the rating of the security might migrate over time, but rather how the initial rating of the security might have differed if key rating input parameters were varied. Parameter Sensitivities for the typical EMEA RMBS transaction are calculated by stressing key variable inputs in Moody's primary rating model. For instance, if the assumed MILAN Aaa Credit Enhancement of 21% used in determining the initial rating was increased to 33% and the expected loss of 7.0% was increased to 16.0%, the model output for Series A, B and Series C of Aa2, Ba1 and B1 would have changed to Baa2, Caa1 and C respectively. The principal methodology used in this rating was Moody's Approach to Rating RMBS in Europe, Middle East, and Africa published in June 2012. In rating this transaction, Moody's used ABSROM to model the cash flows and determine the loss for each tranche. The cash flow model evaluates all default scenarios that are then weighted considering the probabilities of the lognormal distribution assumed for the portfolio default rate. In each default scenario, the corresponding loss for each class of notes is calculated given the incoming cash flows from the assets and the outgoing payments to third parties and noteholders. Therefore, the expected loss or EL for each tranche is the sum product of (i) the probability of occurrence of each default scenario; and (ii) the loss derived from the cash flow model in each default scenario for each tranche. As such, Moody's analysis encompasses the assessment of stressed scenarios. The ratings address the expected loss posed to investors by the legal final maturity of the notes. In Moody's opinion, the structure allows for timely payment of interest and ultimate payment of principal with respect to the Notes by the legal final maturity. Moody's ratings address only the credit risks associated with the transaction. Other non-credit risks have not been addressed, but may have a significant effect on yield to investors. Moody's will monitor this transaction on an ongoing basis. As the Euro area crisis continues, the rating of the structured finance notes remain exposed to the uncertainties of credit conditions in the general economy. The deteriorating creditworthiness of euro area sovereigns as well as the weakening credit profile of the global banking sector could negatively impact the ratings of the notes. REPSOL SA: Moody's Downgrades Preferred Stock Rating to 'Ba2' ------------------------------------------------------------- Moody's Investors Service has downgraded the long-term issuer rating of Repsol S.A. to Baa3 from Baa2, the senior unsecured long-term rating of Repsol International Finance B.V. to Baa3 from Baa2 and its short-term rating to Prime-3 from Prime-2. Concurrently, Moody's has also downgraded the preferred stock rating of Repsol International Capital Limited to Ba2 from Ba1. The outlook on all ratings is stable. Ratings Rationale "The rating downgrade reflects the negative impact of Argentina's expropriation of Repsol's 51% stake in YPF on Repsol's overall credit profile," says Francois Lauras, a Moody's Vice President -- Senior Credit Officer and lead analyst for Repsol. "The loss of its controlling stake in YPF reduces the scale and diversity of Repsol's business profile, and deprives the group of sizeable assets and the YPF dividend stream," adds Mr Lauras. In fiscal 2011, YPF accounted for approximately one third of Repsol's consolidated proved reserves and nearly half its hydrocarbon production (on a proportional basis). The expropriation also increases the group's relative exposure to the European refining sector, which has recently been particularly challenged due to overcapacity and weak demand conditions, and to the economic woes currently affecting its main downstream markets of Spain and Portugal. From a financial standpoint, the action of the Argentinean government has resulted in a material deterioration in Repsol's credit metrics. This comes at a time when Repsol is engaged in high capital spending in order to bring its major upstream projects to market, which Moody's expects to result in further negative free cash flow (before divestments) for the group over the next two years. The group will no longer derive a stable and substantial dividend income from YPF, which since 2003 has averaged in excess of US$1 billion per annum. In 2011, YPF's dividend accounted for around 30% of Repsol's retained cash flow. Meanwhile, the level and timing of any monetary compensation that Repsol could potentially secure from the Argentinean government remains highly uncertain. Moody's acknowledges the comprehensive set of corrective actions initiated by Repsol's management in response to the YPF expropriation, as it seeks to cut debt and conserve cash. The measures include (i) a reduction in the dividend payout ratio in parallel with the introduction of a scrip dividend program; (ii) the exchange of the group's outstanding preferred shares into mandatory convertible bonds; and (iii) the sale of the balance of the treasury shares bought back from Sacyr in December 2011, as well as the divestment of non-core assets, which are expected to raise around EUR2 billion during the period 2012-2016. However, Moody's cautions that the implementation of these initiatives inevitably entails execution risk. While the scrip dividend programs recently introduced by Spanish corporates and banks have enjoyed relatively high levels of acceptance, the take-up for Repsol's scrip dividend could fall short of management's expectations of around 50%. Also, the proportion of holders who may opt to exchange their preferred shares into mandatory convertible bonds is uncertain. On a more positive note, Repsol's recent successful track record of strengthening its hydrocarbon resource base (mainly through exploration discoveries) and developing a solid pipeline of upstream projects should give a significant fillip to its production profile and operating cash flow generation over the next five years. Also, Moody's would expect the recent expansion of Repsol's refinery conversion capacity in Spain to provide some support to its downstream margins and profitability amid a challenging operating environment. Moody's considers that Repsol's liquidity position for the next 12 months is satisfactory (with the next sizeable bond maturity scheduled in July 2013). However, the rating agency will continue to monitor the group's progress in renewing its committed bank lines in the context of the volatile operating environment affecting the Spanish and European banking sectors, and in raising additional funds through new financing facilities and/or asset disposals. The stable rating outlook reflects Moody's expectation that Repsol's timely implementation of the various initiatives in the wake of the YPF expropriation, in parallel with the successful execution of its major upstream projects, will help shore up its financial profile and position its credit metrics in line with the Baa3 rating, including retained cash flow (RCF)/net debt (based on the equity accounting of Gas Natural) above 25%. WHAT COULD CHANGE THE RATING UP/DOWN Moody's considers that a rating upgrade is unlikely in the near term. However, positive momentum for the rating could result from a permanent and significant reduction in Repsol's indebtedness, in conjunction with a material strengthening of the group's operating cash flow generating capacity, driven by the successful start-up of its key upstream growth projects. This would most likely be evidenced by a marked improvement in the group's financial metrics, including RCF/net debt (based on the equity accounting of Gas Natural) rising markedly above 30% on a sustainable basis. Conversely, negative rating pressure could arise if Repsol were unable to reposition its financial metrics in line with the Baa3 rating as a result of (i) a failure to execute the corrective actions in a timely manner; (ii) significant delays and cost overruns affecting its major upstream projects; and/or (iii) a weaker-than-expected operating performance under Moody's current price assumptions. Negative rating pressure could also arise from any deterioration in the group's liquidity profile as a result of a failure to maintain committed bank lines and/or raise additional funds through new financing facilities and/or asset disposals. Principal Methodology The principal methodology used in these ratings was Global Integrated Oil & Gas Industry published in November 2009. Headquartered in Madrid, Spain, Repsol is a major integrated oil and gas company with consolidated total proved hydrocarbon reserves of 2.1 billion barrels of oil equivalent (boe) (including YPF's contribution of approximately 1.0 billion boe) at the 2011 year-end and a strong downstream presence in the Iberian peninsular. In 2011, the group reported consolidated operating revenue of EUR63.7 billion and hydrocarbon production of 290 million boe (including YPF's contribution of 181 million boe). TDA SA NOSTRA: S&P Withdraws 'B' Ratings on Two Note Classes ------------------------------------------------------------ Standard & Poor's Ratings Services withdrew its credit ratings on TDA Sa Nostra Empresas 2, Fondo de Titulizacion de Activos' class A, B, C, and D notes. "On June 22, 2011, we rated TDA Sa Nostra Empresas 2, which closed in March 2009. The ratings we assigned were based on the credit quality of the assets, the cash flow results, the application of our 2010 counterparty criteria, and the existence of an eligible guarantee over the reinvestment account," S&P said. "BNP Paribas (AA-/Negative/A-1+) is the swap counterparty, Banco Santander S.A. (A-/Negative/A-2) is the paying agent and treasury account provider, and Banca Mare Nostrum S.A. (not rated) is the reinvestment account provider. This account holds 88.42% of reserve fund amount during the life of the transaction," S&P said. "Until now, given that the reinvestment account provider is not rated, a guarantee in line with our 2008 legal criteria was in place. The guarantee provider was originally Banco Popular Espanol S.A., but was substituted by Confederacion Espanola de Cajas de Ahorros (CECA; BBB-/Stable/A-3) in August 2011. At present, under our 2012 counterparty criteria, CECA should be substituted by an eligible guarantor after we downgraded it to BBB-/Stable/A-3 from BBB/Stable/A-2 on April 30, 2012," S&P said. "Nevertheless, we have received written confirmation from the trustee, Titulizacion de Activos S.G.F.T., S.A., that the guarantee has been removed and that no remedy actions are going to be taken. The trustee has informed us that it has received a notification from Banca Mare Nostrum S.A., the only noteholder in this transaction, that it exempts the trustee from any obligation established in the guarantee contract and from taking any remedy action," S&P said. "As a consequence, and taking into account that after the guarantee's removal we cannot rely on a counterparty that does not comply with our 2012 counterparty criteria, we ran our cash flow model without the benefit of the reserve fund amount held in the reinvestment account. Under this scenario no ratings are achieved. We have therefore withdrawn our ratings on TDA Sa Nostra Empresas 2's class A, B, C, and D notes," S&P said. "This portfolio was originated by Caja de Ahorros y Monte de Piedad de las Baleares (Sa Nostra)-- banca Mare Nostrum--which has its home market in the Spanish region of the Balearic Islands. The portfolio comprises Spanish small and midsize enterprise (SME) loan receivables that Sa Nostra originated and sold to the issuer," S&P said. STANDARD & POOR'S 17G-7 DISCLOSURE REPORT SEC Rule 17g-7 requires an NRSRO, for any report accompanying a credit rating relating to an asset-backed security as defined in the Rule, to include a description of the representations, warranties and enforcement mechanisms available to investors and a description of how they differ from the representations, warranties and enforcement mechanisms in issuances of similar securities. The Rule applies to in-scope securities initially rated (including preliminary ratings) on or after Sept. 26, 2011. If applicable, the Standard & Poor's 17g-7 Disclosure Reports included in this credit rating report are available at: http://standardandpoorsdisclosure-17g7.com RATINGS LIST Class Rating To From TDA Sa Nostra Empresas 2, Fondo de Titulizacion de Activos EUR355 Million Asset-Backed Floating-Rate Notes Ratings Withdrawn A NR A- (sf) B NR B+ (sf) C NR B (sf) D NR B (sf) NR-Not rated. * SPAIN: Can Use EU Bailout Funds to Fix Banking System ------------------------------------------------------- Charles Penty at Bloomberg News reports that Spain's request for as much as EUR100 billion (US$125 billion) of European bailout funds may provide the country with enough money to shore up its banking system after three failed attempts in as many years. "Now that they have this money, it will hopefully finally be possible to recognize all the hidden losses and clean up the system," Bloomberg quotes Luis Garicano, a professor at the London School of Economics, as saying in a phone interview. The amount sought is about 2.7 times the funds deemed necessary for Spanish banks by the International Monetary Fund in a report released June 8 and five times the total requested by the Bankia group, the country's third-biggest lender, to cleanse its balance sheet, Bloomberg discloses. Spain sought aid for its banks on June 9, becoming the fourth euro member to seek a bailout since the debt crisis began almost three years ago, Bloomberg notes. Mariano Rajoy, who denied the need for a banking bailout as recently as May 28, will be under scrutiny as his government tries to complete the cleanup after past efforts fell short, Bloomberg states. Jaime Becerril and Axel Finsterbusch, analysts at JPMorgan Chase & Co., said that Spanish banks will probably face fresh provisioning rules as the government mulls how to deploy the funds after receiving information on the size of the capital shortfall from the IMF and the independent audits it has commissioned, Bloomberg relates. =========== S W E D E N =========== SAAB AUTOMOBILE: Chinese-Japanese Group Agree to Buy Company ------------------------------------------------------------ Ola Kinnander at Bloomberg News reports that a Chinese-Japanese investment group that may build electric cars agreed to buy Saab Automobile and bring the Swedish manufacturer back from bankruptcy. According to Bloomberg, a person familiar with the matter said that the group, led by Japanese investment firm Sun Investment and Hong Kong-based renewable-energy power-plant builder National Modern Energy Holdings Ltd., would make the announcement yesterday. Anne-Marie Pouteaux and Hans Bergqvist, Saab's bankruptcy administrators, said in a statement that the carmaker has been sold and the purchaser would be identified at a press conference yesterday, Bloomberg relates. Bloomberg notes that a spokesman said in May that the Chinese- Japanese bidding group formed a company called National Electric Vehicle Sweden AB with the purpose of buying Saab's assets. Saab Automobile AB is a Swedish car manufacturer owned by Dutch automobile manufacturer Swedish Automobile NV, formerly Spyker Cars NV. Saab Automobile AB, Saab Automobile Tools AB and Saab Powertain AB filed for bankruptcy on Dec. 19, 2011, after running out of cash. =========================== U N I T E D K I N G D O M =========================== ELLI INVESTMENTS: Moody's Assigns 'B2' CFR/PDR; Outlook Stable -------------------------------------------------------------- Moody's Investors Service has assigned a B2 corporate family rating (CFR) and probability-of-default rating (PDR) to Elli Investments Ltd., an entity beneficially owned by private equity investor Terra Firma. Concurrently, Moody's has assigned provisional ratings to the company's proposed issuance of GBP350 million worth of secured notes (rated (P)B1) due in 2019 and GBP175 million worth of unsecured notes (rated (P)Caa1) due in 2020. In addition, the rating agency has assigned a rating of (P)Ba2 to the company's GBP40 million secured super senior revolving credit facility maturing in 2018. The rating outlook is stable. This is the first time that Moody's has rated Elli. The ratings are contingent upon Elli's success in closing its proposed acquisition of Four Seasons Health Care Holdings Limited ("FSHC"), which is subject to regulatory approval, and the incorporation of the above-mentioned notes in the financing package put in place to partially finance the transaction. Until the time of closing the proceeds from the notes issuance will be held in escrow. Moody's understands that the remainder of the acquisition price, approximately GBP335 million, will be injected as common equity or deeply discounted non-cash paying bonds. Elli does not have any other business activities other than those carried out by FSHC. Moody's issues provisional ratings in advance of the final sale of securities and these reflect the rating agency's credit opinion regarding the transaction only. Upon a conclusive review of the final documentation, Moody's will endeavor to assign definitive ratings to the instruments mentioned above. A definitive rating may differ from a provisional rating. Ratings Rationale The B2 rating reflects Moody's expectation that, following the closing of the transaction, the company will exhibit high leverage, such that its debt/EBITDA ratio will be approximately 5.5x (based on pro-forma EBITDA of GBP102 million as per March 2012, and adjusted by capitalizing estimated annual operating leases of approximately GBP52 million at 6x). "While the relatively weak initial credit metrics and large share of leasehold properties in the portfolio are a constraining factor on Elli's rating, Moody's also notes the company's attractive business profile, with market-leading positions and stable and recurring revenue base," says Alex Verbov, Vice President and Moody's lead analyst for Elli's. Following the acquisition of parts of Southern Cross's portfolio in 2011, Elli has become the largest UK operator of elderly care, with pro-forma revenues of around GBP685 million. Although the Company also runs Specialist hospitals and care centers with some 1,200 beds, elderly care accounts for over 85% of both revenues and EBITDA contribution. Increased funding constraints on the public healthcare system and regulatory compliance costs are likely to continue having a negative impact both on the UK healthcare industry and Elli. In the past, changing customer mix and the gap between fee increases and cost inflation led to gradual EBITDA margin declines. Going forward, Moody's expects Elli to at least maintain its absolute profitability levels and benefit from longer-term growth potential due to favorable demographics as well as gradual increase in occupancy following the integration of recent portfolio additions via Southern Cross and Care Principles transactions. Estimated pro-forma EBITDA margins of around 15% reflect a significant share of leasehold properties (EBITDA margins adjusted for leases are 7% higher at c. 22%), and highlight Elli's higher operational leverage than seen for largely freehold operators. This is being partly mitigated by the variable terms agreed on a large portion of leases from the Southern Cross acquisition, which reduces both the downside and the upside impact for the Company. Moody's notes that the rating incorporates expectation for a relatively slow deleveraging profile of the Company and the constraining impact that the large leasehold portfolio has on the leverage metric. Liquidity Moody's views Elli's liquidity position as adequate. Whereas an estimated GBP 13 million cash balance available at closing is largely earned marked for a GBP10 million contingent payment due in 2013 to the selling shareholders if 2012 EBITDA reaches GBP106 million, the Company does not have material working capital needs, will have access to GBP40 million of undrawn revolver line and is expected to generate positive free cash flow. The revolver facility is subject to a material adverse change clause and a financial covenant, which has generous headroom, in the rating agency's view. Moody's would expect that following the closing, Elli will continue to improve its liquidity position via increase in cash balances and would not be aggressively pursuing acquisitions / development capex projects until it has achieved an adequate cash balance. Structural Considerations The GBP40 million secured super senior revolving credit facility and the GBP350 million worth of senior secured notes benefit from pari-passu ranking guarantees from all material group entities, representing a minimum of 80% of all the group assets and EBITDA at closing. While both instruments benefit from a pledge of essentially all group assets, the (P)Ba2 rating assigned to the revolver (Loss Given Default rating of LGD1, 1%) is a reflection of the instrument's super seniority in the event of an enforcement of the collateral, with only the remaining proceeds to be applied to the secured notes ((P)B1, LGD 3, 33%). The (P)Caa1 (LGD5, 85%) rating on the GBP175 million worth of senior unsecured notes reflects their junior ranking behind a sizable portion of Elli's secured debt and the subordinated nature of the guarantees in place. Whereas the sizing of the revolver line is relatively moderate compared to other UK healthcare credits, it may be increased going forward by up to GBP35 million subject to corresponding increases in EBITDA (i.e. total revolver not to be higher than 40% of EBITDA). Moody's notes that the proceeds of the notes issuance will be placed in an escrow account (unguaranteed but with the proceeds being pledged as security) and will only be released upon closing of the acquisition. If the acquisition does not materialize, Elli will be required to redeem the notes at a redemption price of 100% of the initial issue price plus accrued and unpaid interest, which will be prefunded into the escrow account. Rating Outlook and Triggers The stable outlook reflects Moody's expectation that no significant changes in leverage are likely in the next 12-18 months, partly attributable to the stabilizing impact of lease capitalization on the leverage metric volatility. Negative pressure could be exerted on the rating in the event of increasing margin pressure and gross leverage exceeding 5.75x (pro forma per 12/2011: 5.5x) and/or EBITA/Interest Cover falling below 1.4x (pro forma per 12/2011:1.4x). Aggressive acquisition, development and dividend policies could also be triggers for a downgrade. An upgrade would require a sustained period of maintaining profitability and cash flow generation at a high level, with a subsequent reduction in leverage, with for example debt/EBITDA improving materially below 5.0x and/or EBITA interest cover increasing over 1.8x. The principal methodology used in rating Elli was the Global Healthcare Service Providers Industry Methodology published in December 2011. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. FSHC is the largest independent provider of elderly care in the UK with estimated pro-forma revenues of around GBP690 million. LOLA CARS: Rotary Supercars Prepares Takeover Bid ------------------------------------------------- Hunts Post reports that a Germany-based Rotary Supercars has confirmed that it will be bidding to take over Lola Cars. Lol went into administration four weeks ago, blaming the withdrawal by the Government of research and development tax credits for its demise, Hunts Post relates. According to Hunts Post, Lola administrators Mark Newman and James Snowdon, of CCW Recovery Solutions LLP, have been searching for a buyer and this week said they had received significant interest in the business. Hunts Post notes that Darren Wattiez, Rotary CEO, said he was preparing a "substantial bid that was over and above the market value." Mr. Wattiez, as cited by Hunts Post, said he would look to keep the Lola brand as it was well established in the motor racing industry. The engine designer said his bid would be for the whole company, but would consider bidding just for the motorsport side of the business, according to Hunts Post. Lola's administrators last week announced a further eight job losses, Hunts Post recounts. The firm entered administration on May 16 and has lost more than 80 of its 176 jobs at the two sites, Hunts Post discloses. Lola Cars is a racing car manufacturer and composites company. MONDRIAN INVESTMENT: Moody's Affirms 'Ba2' CFR; Outlook Stable -------------------------------------------------------------- Moody's Investors Service affirmed the Ba2 Corporate Family Rating of Mondrian Investment Partners and revised the rating outlook to positive from stable. The rating outlook change reflects Mondrian's improving credit fundamentals and financial flexibility, which resulted from the acceleration of debt repayments made during the fiscal year 2011. Mondrian's rating and outlook also reflect the continued stability of revenues and lower volatility of the firm's business profile due to its value-oriented, international investment focus relative to other asset managers. This stability has enabled management to prioritize debt repayments such that financial leverage has dropped from a proforma 3.3x debt to EBITDA in June 2011 to 2.1x as of December 31, 2011. Moody's expects leverage to continue to decrease in 2012 as management plans to continue to use free cash flow to voluntarily pay down debt. Ratings Rationale Mondrian's Ba2 Corporate Family Rating reflects the company's improving credit fundamentals, characterized by moderate financial leverage and interest coverage, along with earnings stability, despite difficult market conditions. The rating also incorporates Mondrian's relatively modest distribution channel diversification, as well as the diversity and quantum of its AUM relative to other Moody's-rated asset managers. While the firm's footprint is relatively small versus its rated peers, Moody's views favorably Mondrian's continued focus on its strengths as a value-oriented investment manager. Based upon manager universe performance measures, the firm continues to demonstrate an ability to provide risk-adjusted returns in the top quartiles of its peer universe for its core investment offering. The positive outlook reflects an expectation for continued deleveraging and improvement in Mondrian's credit fundamentals. Based on Mondrian's strategy, it is expected that voluntary debt repayments will remain a priority through 2012. While the firm's debt repayments have brought down cash balances, liquidity remains at a level consistent with the firm's rating level. The following ratings were affirmed and their outlook changed to positive from stable: Corporate family rating: Ba2 Senior secured term loan due 2018: Ba2 Mondrian Investment Partners, Ltd., headquartered in London, is a global asset management company. The firm had US$69.2 billion of assets under management as of December 31, 2011. The principal methodology used in this rating was Moody's Global Rating Methodology for Asset Management Firms, published in October 2007. RANGERS FC: Faces Liquidation; HMRC Rejects Green's Proposals ------------------------------------------------------------- Peter Woodifield at Bloomberg News reports that Rangers Football Club Plc faces liquidation after the U.K. tax authorities rejected proposals to let it exit administration, according to Charles Green, who is leading a group to buy the Scottish soccer club. According to Bloomberg, Mr. Green said in a statement on Rangers' Web site that HM Revenue & Customs refused to support a proposal by Mr. Green's group to pay creditors GBP8.5 million (US$13.2 million) as part of a Company Voluntary Arrangement that would have seen the club come out of bankruptcy and avoid winding up. Rangers owes the tax authorities more than GBP93 million in unpaid taxes and two unresolved claims over the use of employee benefit trusts, Bloomberg discloses. Duff & Phelps, the administrators, said on April 5 that in total, the 54-time Scottish soccer champion owes creditors more than GBP134 million, Bloomberg recounts. The tax office said winding up Rangers in its current form will allow a new company to start without any burden, Bloomberg notes. "A liquidation provides the best opportunity to protect taxpayers, by allowing the potential investigation and pursuit of possible claims against those responsible for the company's financial affairs in recent years," Bloomberg quotes HMRC as saying in a statement on its Web site. "It also means that the new company will be free from claims or litigation in a way which would not be achievable with a CVA. Rangers can make a fresh start." Creditors are due to meet on June 14 to vote on the CVA proposals, Bloomberg discloses. The amount of money owed to HMRC means they are sure to fail, Bloomberg notes. Mr. Green said that his group will now have to form a new company to buy Rangers, and creditors will receive GBP5.5 million, GBP3 million less than they would have done under the proposals rejected by HM Revenue and Customs, Bloomberg relates. "I, along with my investors who believe that Rangers can have a bright future, will fight tooth and nail to ensure the Club recovers from this catastrophic phase in its proud history," Mr. Green, as cited by Bloomberg, said. Mr. Green said that his group will look for ways to allow the 26,000 investors in Rangers who will lose their shares as a result of liquidation to buy shares in the new company, Bloomberg relates. Mr. Green said he will liaise with Scottish football authorities to discuss Rangers' membership of the Scottish Premier League, Bloomberg relates. The 11 other clubs will have to agree to readmit Rangers as a new company, Bloomberg states. Otherwise, Rangers will have to apply to be admitted to the Scottish Football League and start afresh in the fourth tier of the country's soccer league, according to Bloomberg. About Rangers Football Club Rangers Football Club PLC -- http://www.rangers.premiumtv.co.uk/ -- is a United Kingdom-based company engaged in the operation of a professional football club. The Company has launched its own Internet television station, RANGERSTV.tv. The station combines the use of Internet television programming alongside traditional Web-based services. Services offered include the streaming of home matches and on-demand streaming of domestic and European games, which include dedicated pre-match, half-time and post- match commentary. The Company will produce dedicated news magazine and feature programs, while the fans can also access a library of classic European, Old Firm and Scottish Premier League (SPL) action. Its own dedicated television studio at Ibrox provides onsite production, editing and encoding facilities to produce content for distribution on all media platforms. TUCAN CLAIMS: In Administration; 15 Jobs Affected ------------------------------------------------- BBC News reports that Tucan Claims has gone into administration, leaving 15 people redundant. According to BBC, the company's administrator, John Cullen, of Harris Lipman, said: "Issues with its payment service providers have left Tucan Claims in the position of having to appoint administrators." A Harris Lipman spokesman later added that these service providers, which process customer fees, had been withholding them from Tucan Claims, BBC relates. Mr. Cullen, as cited by BBC, said: "My role now is to review the firm's financial position and establish which of its clients are likely to get back the deposits they were required to pay upfront together with investigating the circumstances surrounding the failure of the company." "If you are a client of Tucan Claims, and require a refund of your initial fee, you may be able to obtain your refund by making a chargeback via your card issuer. "Please contact your card issuer directly and request that a chargeback be processed." The Ministry of Justice has written to Tucan Claims' customers advising the same, and also that they should contact the administrators to register as creditors, BBC says. More than 1,000 people have complained to Trading Standards in South Gloucestershire about Tucan Claims in the past 12 months, BBC relates. In April the government regulator for claims management service providers banned Tucan Claims from taking on new business, BBC recounts. The company lodged its application to go into administration the day before the outstanding refunds were due, and the administration order was granted on May 28, BBC discloses. Tucan Claims is a claims management company based Aztec West. It worked to get compensation for people who had been mis-sold Payment Protection Insurance (PPI). =============== X X X X X X X X =============== * Upcoming Meetings, Conferences and Seminars --------------------------------------------- July 14-17, 2012 AMERICAN BANKRUPTCY INSTITUTE Southeast Bankruptcy Workshop The Ritz-Carlton Amelia Island, Amelia Island, Fla. Contact: 1-703-739-0800; http://www.abiworld.org/ Aug. 2-4, 2012 AMERICAN BANKRUPTCY INSTITUTE Mid-Atlantic Bankruptcy Workshop Hyatt Regency Chesapeake Bay, Cambridge, Md. Contact: 1-703-739-0800; http://www.abiworld.org/ November 1-3, 2012 TURNAROUND MANAGEMENT ASSOCIATION TMA Annual Convention Westin Copley Place, Boston, Mass. Contact: http://www.turnaround.org/ Nov. 29 - Dec. 2, 2012 AMERICAN BANKRUPTCY INSTITUTE Winter Leadership Conference JW Marriott Starr Pass Resort & Spa, Tucson, Ariz. Contact: 1-703-739-0800; http://www.abiworld.org/ April 10-12, 2013 TURNAROUND MANAGEMENT ASSOCIATION TMA Spring Conference JW Marriott Chicago, Chicago, Ill. Contact: http://www.turnaround.org/ October 3-5, 2013 TURNAROUND MANAGEMENT ASSOCIATION TMA Annual Convention Marriott Wardman Park, Washington, D.C. Contact: http://www.turnaround.org/ ********* 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 2012. 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 Peter Chapman at 240/629-3300. * * * End of Transmission * * *