---

       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 16, 2013, Vol. 14, No. 11

                            Headlines



A U S T R I A

* Austrian Banks to Remain Committed to CEE Countries, Fitch Says


B E L G I U M

KBC BANK: S&P Assigns 'BB+' Rating to Proposed Tier 2 Notes


C Y P R U S

HELLENIC BANK: Moody's Lowers Deposit Rating to 'Caa2'
RUSSIAN COMMERCIAL: Moody's Downgrades Deposit Ratings to 'Caa1'


F R A N C E

CERBA EUROPEAN: S&P Assigns Prelim. 'B+' Corporate Credit Rating
CERBA EUROPEAN: Fitch Assigns 'B+' Issuer Default Rating
PRESSOIRS DE FRANCE: In Administration, Fails to Find Backer


G R E E C E

DRYSHIPS INC: Sells Two Tankers Under Construction


H U N G A R Y

GYULAI HUSKOMBINAT: Gyula Court Appoints New Liquidator


I T A L Y

CERVED TECHNOLOGIES: Moody's Assigns 'B2' CFR; Outlook Negative


N E T H E R L A N D S

NEW WORLD: Moody's Rates EUR275MM Senior Unsecured Notes '(P)B3'
NEW WORLD: S&P Rates Proposed EUR275MM Sr. Unsecured Notes 'B'
TELENET GROUP: Liberty Global Increases Ownership to 58%
UCL RAIL: S&P Assigns 'BB+' Longterm Corporate Credit Rating


N O R W A Y

NOTABENE: Lesi AS to Take Over 110 Stores Covered by Bankruptcy


P O L A N D

LOT POLISH: Gov't Mulls Downsize to Restore Profitability


R O M A N I A

HIDROELECTRICA: Expects to Exit Insolvency by End-June


R U S S I A

FREIGHT ONE: S&P Affirms 'BB+' Rating; Outlook Stable
FREIGHT JSC: Fitch Withdraws Low-B Ratings on Acquisition
GAZPROM: Fitch Says Weak European Sales Likely to Continue
UCL RAIL: Fitch Assigns 'BB+' LT Issuer Default Rating
VNESHPROMBANK: S&P Raises Counterparty Credit Rating to 'B'


S W E D E N

SAAB AUTOMOBILE: U.S. Unit Has Secure Program for Vehicle Owners


U K R A I N E

AEROSVIT: Enters Restructuring Period Following Bankruptcy


U N I T E D   K I N G D O M

BOSAL UK: Goes Into Administration
DUBAI GROUP: Settles Restructuring Rift; Banks Sell Back Debt
HMV: In Administration, 4,000++ Jobs at Risks
ROSSETT HALL: Bought Out of Administration by Convivial Hotels
SOCIAL CARE: S&P Assigns Preliminary 'B' Corporate Credit Rating

VOYAGE BIDCO: Moody's Assigns '(P)B2' CFR; Outlook Stable
VOYAGE HOLDING: Fitch Assigns 'B' IDR; Outlook Negative
* Fitch Says Return on Assets, Not RPI, Are Killing UK Pensions
* Fitch Says Downgrades to Outnumber Upgrades Among EMEA Cos.


X X X X X X X X

* CEE 2013 Fiscal Financing Needs Lower Than Eurozone, Fitch Says


                            *********


=============
A U S T R I A
=============


* Austrian Banks to Remain Committed to CEE Countries, Fitch Says
-----------------------------------------------------------------
Fitch Ratings expects the major Austrian banks to remain
committed to their operations in core Central and Eastern
European (CEE) countries despite ongoing macroeconomic and
regulatory challenges. While exiting more peripheral CEE and
Commonwealth of Independent States (CIS) markets is a
possibility, the large Austrian banks have sufficient scale and
sufficiently strong local funding franchises to mitigate current
headwinds in CEE, says Fitch in a new special report.

CEE operations are the main driver of Austria's large banks'
profitability following their expansion into the region in the
1990s and 2000s. While CEE activities typically generate higher
margins than the banks' domestic business, they are also
significantly more volatile, as evidenced in the downturn in many
CEE markets in 2009. However, the large banks' diversification
across the region and their substantial lower margin but less
volatile domestic franchises largely mitigates CEE earnings and
risk volatility.

The Austrian banking sector is dominated by the country's three
largest banks, UniCredit Bank Austria AG ('A'/Stable/'bbb+'),
Erste Group Bank AG ('A'/Stable/'a-') and the Raiffeisen banking
sector including its subsidiary Raiffeisen Bank International AG
('A'/Stable/'bbb').

While the large Austrian banks have fared comparatively well
since the financial crisis, notably due to their considerable
geographical diversification, emphasis on deposit-funded growth
and dominant franchises in Austria and many CEE countries, in
Fitch's view, the second tier of Austria's banking system is
considerably weaker. Smaller Austrian banks such as Volksbanken
Verbund ('A'/Stable/'bb-') and Kommunalkredit Austria
('A'/Stable/'b+') have encountered difficulties since 2008 and
had to rely on various degrees of sovereign support.

Following the effective nationalisation of several second tier
banks in the wake of the financial crisis, since 2009 the
Austrian supervisory authorities have made efforts to strengthen
banking supervision, among other things through a more
transparent division of responsibility between the two main
supervisory bodies, the Financial Market Authority and the
Austrian National Bank, as well as tighter capital and funding
requirements.

The special report, entitled "The Austrian Banking System -
Features, Trends, Risks" provides an overview of main
characteristics of the system, recent developments regarding
profitability, asset quality and funding as well as background on
Austrian banking laws and supervisory institutions.



=============
B E L G I U M
=============


KBC BANK: S&P Assigns 'BB+' Rating to Proposed Tier 2 Notes
-----------------------------------------------------------
Standard & Poor's Ratings Services said it has assigned its 'BB+'
long-term issue rating to Belgium-based KBC Bank NV's (A-
/Positive/A-2) proposed Tier 2 contingent capital notes.  The
rating is subject to S&P's review of the final terms and
conditions.  S&P has also designated the proposed notes as having
"minimal" equity content under its bank hybrid criteria.

"We understand that the proposed notes will be subordinated and
rank pari passu with KBC Bank's existing dated subordinated
notes, prior to a trigger event.  KBC Bank has stated that a
capital adequacy trigger event shall occur if KBC Group NV's
consolidated transitional CET1 ratio is less than 7% (CET1 is
defined as core tier 1 capital before the adoption of Capital
Requirements Directive (CRD) IV and common equity tier 1 on or
after the adoption date).  We understand that in the event that
the CET1 ratio falls below the trigger, the principal of the
notes will be automatically written down to zero, and will be
cancelled.  In our view, the proposed notes are "going-concern"
contingent capital because they are linked to a 7% trigger," S&P
said.

"When assigning a rating to a hybrid capital instrument with a
going-concern capital trigger, we apply Table 3a from our bank
hybrid criteria, which reflects the bank's stand-alone credit
profile (SACP) and Standard & Poor's projection of the specified
regulatory ratio on an 18-24 month forward-looking basis.  KBC
Bank's SACP is 'bbb+'.  We project that KBC Group NV's
transitional  CET1 ratio will remain greater than 11% by the end
of 2014, which is above 401 basis points from the trigger.  This
projection is based on our estimate of KBC Group's transitional
CET1 ratio taking into account our estimate of future earnings,
the finalization of the agreed divestments, and government hybrid
reimbursements.  It is also based on our understanding of the
Belgian regulator's transitional rules for CRD IV implementation.
We therefore assign a 'BB+' rating to the proposed issue," S&P
added.

"We have assigned minimal equity content, in accordance with our
bank hybrid criteria, because we expect the notes to have a
stated maturity of less than 15 years.  One of the requirements
to achieve "intermediate" equity content for a going-concern
contingent capital instrument is a residual life of at least 15
years if the SACP of the issuer is 'bbb-' or higher," S&P noted.

RATINGS LIST

New Rating

KBC Bank N.V.
Junior Subordinated                    BB+



===========
C Y P R U S
===========


HELLENIC BANK: Moody's Lowers Deposit Rating to 'Caa2'
------------------------------------------------------
Moody's Investors Service has downgraded the senior unsecured
debt and deposit ratings of three Cypriot banks to Caa2 and
lowered the standalone credit assessments of two of those banks,
Hellenic Bank Public Company Ltd. to caa3 from caa2 and Cyprus
Popular Bank Public Co. Ltd. to ca from caa3. The outlook on the
banks' senior debt and deposit ratings is negative.

These rating actions are triggered by the downgrade of Cyprus's
government bond rating to Caa3 and they reflect (1) uncertainty
regarding the timing and conditions of a finalized Memorandum of
Understanding (MoU) between the Cypriot government and the
International Monetary Fund, the European Union and the European
Central Bank to finance bank recapitalizations; (2) heightened
risk of sovereign default, which could jeopardize the
effectiveness of bank recapitalizations once the external support
program is in place; and (3) the associated impact of increased
sovereign credit risk on banks' standalone credit profiles, given
the banks' sizable portfolios of government securities.

The three affected banks are:

-- Cyprus Popular Bank Public Co Ltd (CPB): Senior unsecured
    debt and deposit ratings downgraded to Caa2 from Caa1;
    standalone credit assessment lowered to ca from caa3, within
    the E standalone bank financial strength rating (BFSR)
    category.

-- Hellenic Bank Public Company Ltd (Hellenic): Deposit ratings
    downgraded to Caa2 from B3; standalone credit assessment
    lowered to caa3 from caa2, within the E standalone BFSR
    category.

-- Bank of Cyprus Public Company Limited (BoC): Senior unsecured
    debt and deposit ratings downgraded to Caa2 from Caa1;
    standalone credit assessment of caa3 remains unchanged within
    the E BFSR category.

These rating actions conclude the review for downgrade initiated
on November 19, 2012.

RATING RATIONALE

-- INCREASED UNCERTAINTY OF SUPPORT AND INCREASED SOVEREIGN
    DEFAULT RISK

The downgrade of the three banks' senior debt and deposit ratings
to Caa2 reflects uncertainty regarding the finalization and terms
of a MoU with the International Monetary Fund, the European Union
and the European Central Bank, also collectively known as the
Troika, to finance bank recapitalizations. Moody's believes that
the current agreement in principle between Cyprus and the Troika
on a MoU represents significant progress, however, the rating
agency notes (1) that the finalization of an agreement and
disbursement of funds that will finance bank recapitalizations
have been delayed and (2) that the terms targeting the banking
system remain uncertain. Moreover, Moody's also notes that the
risk of sovereign default has risen, which could jeopardize the
effectiveness of bank recapitalizations once the external support
program is in place. For these reasons, the rating agency has
lowered the assumptions of external support it imputes in Cypriot
banks' ratings, aligning the senior unsecured debt and deposit
ratings of the three systemically important banks at Caa2.

-- EXPOSURE TO CYPRIOT GOVERNMENT SECURITIES ALSO INCREASE
    STANDALONE BANK RISK

The lowering of the standalone credit assessments of two of the
three rated banks was primarily triggered by the increase in
sovereign credit risk, given the banks' sizable portfolios of
government securities.

CYPRUS POPULAR BANK

The lowering of CPB's standalone credit assessment to ca from
caa3 reflects Moody's views of the higher vulnerability of CPB's
capital position. While Moody's notes that its estimated
recapitalization needs for all three rated banks have grown,
owing to the recent acceleration in asset-quality deterioration
and the weakening of sovereign creditworthiness, Moody's views
the vulnerability of CPB's capital position as more acute than
those of its domestic peers. This reflects (1) CPB's weaker asset
quality, owing to its higher exposure to Greek borrowers
(accounting for 44% of net loans, including shipping loans booked
in Greece); and (2) the more pronounced impact of weakening
sovereign credit risk, given CPB's large exposure to Cyprus
government bonds, which Moody's estimates at 282% of its core
Tier 1 (including EUR1.8 billion in Cyprus government bonds
received in June 2012 as government capital support).

HELLENIC BANK

The lowering of Hellenic Bank's standalone credit assessment to
caa3 from caa2, primarily reflects the impact of the weakening
credit profile of the Cypriot government, given Hellenic's
sizable holdings of government securities. According to the
bank's financial statements, investments in Cyprus government
bonds accounted for 78% of Hellenic's proforma core Tier 1 as of
September 2012 (including capital raised after the 30th of
September), closely linking Hellenic's credit-risk profile to
that of the government of Cyprus.

BANK OF CYPRUS

The standalone credit assessment for BoC remains unchanged at
caa3, reflecting Moody's view that this assessment (in line with
the government of Cyprus's bond rating of Caa3) continues to
capture BoC's current balance-sheet risks and recapitalization
needs.

WHAT COULD MOVE THE RATINGS DOWN/UP

Asset-quality pressures beyond those currently envisaged leading
to further material increases to the three banks'
recapitalization needs would exert downwards pressure on the
ratings.

Upwards pressure could develop over time, following (1) the
restructuring and/or removal of non-performing assets from the
banks' balance sheets; and (2) significant strengthening of the
banks' capital buffers.

LIST OF AFFECTED RATINGS

Bank of Cyprus Public Company Limited:

- Deposit and senior unsecured debt ratings: Downgraded to Caa2,
   with negative outlook, from Caa1 on review for downgrade

- Short term deposit and commercial paper ratings: Not Prime
   unaffected

- Subordinated debt rating: (P)C unaffected

- Junior subordinated notes rating: (P)C unaffected

- Standalone BFSR: E equivalent to caa3 unaffected

No outlook is currently assigned to the BFSR, subordinated and
junior subordinated debt ratings.

Cyprus Popular Bank Public Co Ltd:

- Deposit and senior unsecured debt ratings: Downgraded to Caa2,
   with negative outlook, from Caa1 on review for downgrade

- Short term deposit ratings: Not Prime, unaffected

- Subordinated debt rating: C, unaffected

- Standalone BFSR: E equivalent to ca from E/caa3

No outlook is currently assigned to the BFSR and subordinated
debt ratings.

Egnatia Finance plc (the funding subsidiary of Cyprus Popular
Bank):

- Senior unsecured debt rating: Downgraded to (P)Caa2, with
   negative outlook, from (P)Caa1 on review for downgrade

- Subordinated debt rating: (P)C unaffected

No outlook is currently assigned to the subordinated debt
ratings.

Hellenic Bank Public Company Ltd:

- Deposit ratings: Downgraded to Caa2 with negative outlook from
   B3 on review for downgrade

- Short-term deposit and commercial paper ratings: Not Prime,
   unaffected

- Standalone bank financial strength rating (BFSR): E equivalent
   to caa3 from E/caa2

No outlook is currently assigned to the BFSR.

Principal Methodology

The principal methodology used in these ratings was Moody's
Consolidated Global Bank Rating Methodology published in June
2012.


RUSSIAN COMMERCIAL: Moody's Downgrades Deposit Ratings to 'Caa1'
----------------------------------------------------------------
Moody's Investors Service has downgraded Russian Commercial Bank
(Cyprus) Ltd. (RCB) deposit ratings to Caa1, with a negative
outlook, from B1 on review for downgrade, and lowered the
standalone credit assessment to caa1, from b3. This concludes the
review for downgrade initiated on November 19, 2012.

The rating action reflects the downgrade of the Cyprus government
bond rating to Caa3 (negative outlook) from B3 (on review for
downgrade) and the subsequent lowering of the country risk
ceiling for Cyprus to Caa1 from B1.

Rating Rationale

The downgrade of RCB's ratings to Caa1 is driven by the lowering
of the country risk ceiling for Cyprus to Caa1. The country risk
ceiling captures elements of economic, financial, political and
legal risks, including the risk of redenomination currency
controls, and represents the highest rating that can be assigned
to an issuer incorporated in Cyprus. Moody's continues to
acknowledge (1) RCB's very limited exposure to credit risk
arising from Cypriot assets and investments; (2) its business
focus on entities that operate in the Russian Federation; and (3)
the high willingness of RCB's parent bank, the Russian
government-owned Bank VTB JSC (Baa1 deposits, negative; BFSR D-
/BCA ba3, negative) to provide parental support. However, the
rating agency considers that the country risk ceiling captures
the heightened operating environment risks that RCB's franchise
faces in Cyprus.

What Could Move The Ratings UP/DOWN

RCB's ratings could be downgraded following (1) a further
deterioration in sovereign credit risk, triggering a lowering of
the country risk ceiling; (2) evidence of reduced willingness
from Bank VTB to support RCB in case of need; (3) a material
deterioration in the bank's asset quality that would erode its
capital; or (4) significant weakening in RCB's liquidity
position.

As indicated by the negative outlook, upwards pressure on the
ratings is unlikely in the medium term. Over the longer term,
upwards pressure could develop following an upgrade of Cyprus's
bond rating, which would prompt Moody's to raise the country risk
ceiling.

LIST OF RATINGS

-- Long-term local and foreign-currency deposit ratings
    downgraded to Caa1 from B1, with a negative outlook.

-- Standalone bank financial strength downgraded to E,
    equivalent to caa1 from E+/b3.

-- Not-Prime short-term ratings are unaffected.

As of December 2011, RCB had total assets of $13.8 billion. RCB
is headquartered in Limassol, Cyprus.

Principal Methodology

The principal methodology used in this rating was Moody's
Consolidated Global Bank Rating Methodology published in June
2012.



===========
F R A N C E
===========


CERBA EUROPEAN: S&P Assigns Prelim. 'B+' Corporate Credit Rating
----------------------------------------------------------------
Standard & Poor's Ratings Services said that it assigned its
preliminary 'B+' long-term corporate credit rating (CCR) to
France-based clinical laboratory operator Cerba European Lab
SAS (Cerba).  The outlook is stable.

At the same time, S&P assigned its preliminary 'B+' issue rating
to Cerba's EUR355 million senior secured notes due 2020.  The
preliminary recovery rating on the notes is '4', indicating S&P's
expectation of average (30%-50%) recovery in the event of a
payment default.

The final ratings will be subject to the successful closing of
the proposed issuance and will depend on S&P's receipt and
satisfactory review of all final transaction documentation.
Accordingly, the preliminary ratings should not be construed as
evidence of the final ratings.  If the final debt amounts and the
terms of the final documentation depart from the materials S&P
has already reviewed, or if S&P do not receive the final
documentation within what it consider to be a reasonable time
frame, S&P reserve the right to withdraw or revise its ratings.

The ratings on Cerba reflect S&P's view of the company's
relatively aggressive capital structure through its ownership by
private equity group PAI Partners.

"We assess Cerba's financial risk profile as "highly leveraged"
under our criteria.  Cerba is raising EUR355 million of notes to
refinance its bank debt.  Based on the proposed capital structure
after the refinancing, we estimate that Cerba's Standard &
Poor's-adjusted net debt-to-EBITDA ratio will be about 10x by
Dec. 31, 2013.  Our estimate includes financial debt of EUR404
million and about EUR398 million in the form of preference
shares, convertible bonds, and other debt-like instruments such
as shareholder loans," S&P said.

S&P assesses Cerba's business risk profile as "fair" under our
criteria.  S&P base its view on Cerba's position as a leading
operator of clinical laboratory testing services in France,
Belgium, and Luxembourg.

"We consider Cerba's revenue diversification and its growing size
as an advantage in the fragmented, highly regulated, and price-
competitive environment.  This enables the company to exploit
cost advantages through common procurement and overhead
optimization.  These benefits are reflected in comparatively high
operating margins.  We estimate that EBITDA margins will remain
in the low- to mid-twenties, which compares favorably with the
margins of the company's larger international peers," S&P added.

"In our view, despite the potentially negative effects of
European public spending cuts on health care, Cerba will sustain
positive underlying revenue growth of at least low single digits
while successfully integrating new acquisitions and at least
maintaining its operating performance momentum," S&P added.

"We would view adjusted EBITDA cash interest coverage of 2.5x at
all times and positive free operating cash flow (FOCF) generation
as commensurate with the 'B+' rating.  We could take a negative
rating action if adjusted EBITDA interest coverage drops below
2.5x, or if Cerba is not able to generate positive FOCF.  This
would most likely occur if operating margins deteriorate due to
an inability to profitably integrate newly acquired operations,"
S&P noted.

"A positive rating movement is unlikely over the next two years,
in our view, due to Cerba's already high adjusted leverage.
However, we would likely take a positive rating action if the
company sustains adjusted debt to EBITDA of less than 5x," S&P
noted.



CERBA EUROPEAN: Fitch Assigns 'B+' Issuer Default Rating
--------------------------------------------------------
Fitch Ratings has assigned Cerba European Lab SAS a Long-term
Issuer Default Rating (IDR) of 'B+'. The Outlook is Stable.

Fitch has also assigned an expected rating of 'BB-(EXP)'/'RR3' to
Cerba's proposed EUR355 million senior secured notes. Based on
its understanding of the documentation received, Fitch believes
the proposed refinancing of the existing senior secured and
mezzanine facilities is unlikely to impact the IDR. The final
ratings on the notes are contingent upon the receipt of final
documentation and structure conforming to information already
received.

KEY DRIVERS

Leading Player in French Laboratory Market:

The IDR reflects Cerba's position as a leading operator of
clinical pathology laboratories in France. The group benefits
from a strong reputation at the specialized end of the market
(35% of last 12 months (LTM) to September 2012 sales) and is
developing a network of routine labs (30% of LTM sales) that
demonstrate its logistics capabilities in handling a high volume
of tests.

Business and Geographical Diversification:

The group's additional activities in Central Lab globally (12% of
LTM sales) as well as its presence in the Belgian and Luxembourg
routine markets (22% of sales) provide some geographical
diversification and reduce Cerba's exposure to single healthcare
systems. Furthermore, Fitch believes that the collaboration and
knowledge transfer between segments enables synergies and
provides Cerba with a competitive advantage relative to players
only operating in one segment of the market.

Track Record of Acquisitive Strategy:

The IDR is supported by management's track record of resilient
organic growth and profitability performance, supported by
growing volumes over the past few years. In addition, the ratings
reflect the group's ability to take advantage of the
fragmentation and the changing legislation of the French routine
lab market. In Fitch's view, the group's acquisitive strategy is
sensible as this would enable it to increase the network of labs
around regional platforms with the objective of realising
synergies due to a larger scale. Nonetheless, Fitch considers
that this strategy carries inherent execution risk, albeit
limited in light of management's past experience in completing
acquisitions.

Relatively Weak Credit Metrics:

Fitch considers that the group's credit metrics (pro-forma for
the refinancing) are relatively weak with a FFO adjusted gross
leverage in excess of 6.0x and FFO interest cover ratio of about
2.0x. In addition, despite low working capital and capex
requirements and an extended debt maturity profile, Fitch
believes that Cerba's free cash flow generation will be
constrained by the high cash interest payments from the planned
senior secured notes.

Acquisitions Expected to Drive Deleveraging:

In an environment of persistent pressure on reimbursement tariffs
from payers which offsets volume resilience and dampens organic
growth prospects, Fitch believes that Cerba is reliant on
successfully integrating its primarily debt-funded acquisitions
and extracting synergies in order to grow EBITDA and funds from
operations (FFO). As a result, Fitch expects these acquisitions
to support mild deleveraging prospects.

Fitch expects that recoveries for senior secured noteholders upon
default would be maximized in a going-concern scenario. Fitch
applied a discount of 25% to the LTM September 2012 EBITDA (pro-
forma for acquisitions) and a 6.0x distressed multiple to derive
a distressed enterprise value of about EUR350 million. According
to the inter-creditor mechanisms outlined in the documentation
received, Fitch estimates that the recovery rate for the senior
secured notes would fall within the 51%-70% range ('RR3'),
leading to a one-notch uplift from the IDR to 'BB-'.

In its analysis, Fitch has not classified the various shareholder
instruments in the group's structure as debt because, as per the
agency's understanding of the documentation, the main features of
these instruments combined with the inter-creditor principles
outlined match Fitch's assessment of equity-like instruments.

RATING SENSITIVITY GUIDANCE

Positive: Future developments that could lead to positive rating
actions include:

- Cerba's ability to increase its diversification and scale via
   acquisitions whilst maintaining financial flexibility.
- FFO adjusted leverage below 5.0x on a sustained basis.
- FFO interest coverage above 3.0x on a sustained basis.

Negative: Future developments that could lead to negative rating
action include:

- Inability to grow EBITDA and FFO as a result of an
   unsuccessful acquisition strategy.
- Reduced free cash flow due to significant profitability
   erosion.
- FFO adjusted gross leverage above 6.5x on a sustained basis.
- FFO interest coverage below 2.0x on a sustained basis.


PRESSOIRS DE FRANCE: In Administration, Fails to Find Backer
------------------------------------------------------------
Decanter.com reports that after weeks of speculation that it was
in financial difficulties, the Pressoirs de France group has gone
into receivership having failed to find a new financial backer.

In a statement to the French press, owner Nicolas Dubois said the
company was 'without sufficient capital to fund its cash needs,'
according to Decanter.com.

The report relates that Dubois had recently pre-sold clients
large volumes of Champagne at EUR8 a bottle, banking on the sur
lattes price dropping in the current difficult economic climate.

However, the report notes that as the sur lattes price has risen
slightly to just over EUR7, and factoring in the EUR1.20 price
per bottle for disgorgment, the resulting squeeze on margins may
have been in part responsible for Pressoirs de France's financial
collapse.

Decanter.com says that the administrator appointed by the French
courts on January 8 is trying to save jobs at Pressoirs de
France's operation near Reims.

According to reports in the French press the business has total
liabilities of EUR49 million including EUR30 million of bank
debt, Decanter.com says.

Decanter.com discloses that its assets include 40ha of supply
contracts bought with the Jeeper brand (also sold by Tesco on-
line) by Dubois in November 2009, other supply contracts, and the
equivalent of EUR25 million of unsold stock.

Pressoirs de France group is a supplier of cheap Champagne to
major UK supermarkets.



===========
G R E E C E
===========


DRYSHIPS INC: Sells Two Tankers Under Construction
--------------------------------------------------
DryShips Inc., through its majority owned subsidiary, Ocean Rig
UDW Inc., of offshore deepwater drilling services, on Jan. 14
announced the sale, via novation, of two of its tankers under
construction at Samsung Heavy Industries, Esperona and Blanca, to
a third-party buyer.

Under the terms of the two novation agreements dated December 27,
2012, the buyer assumes all rights, benefits, liabilities and
obligations under both shipbuilding contracts, in exchange for
cash consideration of US$21.4 million (or US$10.7 million for
each vessel) paid by the Company to the Buyer.

As a result of this transaction, Dryships is released from all
its obligations under the shipbuilding contracts, both as the
contracting party and as a guarantor.

George Economou, Chairman and Chief Executive Officer of the
Company, commented:  "As we have stated recently, the reduction
or elimination of CAPEX has become a top priority for the
Company.  With the sale of these vessels, Dryships has reduced
its CAPEX by approx. $101 million, after taking into
consideration the payment of $21.4 million to the Buyer of the
vessels."

                       About DryShips Inc.

Based in Greece, DryShips Inc. -- http://www.dryships.com/--
-- owns and operates drybulk carriers and offshore oil
deep water drilling units that operate worldwide.  As of
Sept. 10, 2010, DryShips owns a fleet of 40 drybulk carriers
(including newbuildings), comprising 7 Capesize, 31 Panamax and 2
Supramax, with a combined deadweight tonnage of over 3.6 million
tons and 6 offshore oil deep water drilling units, comprising of
2 ultra deep water semisubmersible drilling rigs and 4 ultra deep
water newbuilding drillships.

DryShips's common stock is listed on the NASDAQ Global Select
Market where it trades under the symbol "DRYS".

On Nov. 25, 2010, DryShips Inc. entered into a waiver letter
for its US$230.0 million credit facility dated Sept. 10, 2007,
as amended, extending the waiver of certain covenants through
Dec. 31, 2010.

The Company reported a net loss of US$47.28 million in 2011,
compared with net income of US$190.45 million during the prior
year.

The Company's balance sheet at Dec. 31, 2011, showed
US$8.62 billion in total assets, US$4.68 billion in total
liabilities, and US$3.93 billion in total equity.



=============
H U N G A R Y
=============


GYULAI HUSKOMBINAT: Gyula Court Appoints New Liquidator
-------------------------------------------------------
MTI-Econews reports that Gyula Court Vice President Tibor Zambori
said the court has appointed the Nemzeti Reorganizacios Nonprofit
Kft (National Reorganization Ltd.) to succeed the Hitelintezeti
Felszamolo Nonprofit Kft (Credit Institutional Liquidator
Nonprofit Ltd.) as the liquidator for Gyulai Huskombinat.

According to MTI-Econoews, the government announced in early
December that it would replace the receiver in charge of
liquidating companies such as Gyulai Huskombinat that have been
declared to be of "elevated strategic importance."

Companies the government declares of "elevated strategic
importance" undergo special liquidation procedures, MTI-Econews
notes.

Gyulai Huskombinat is a Hungary-based sausage company.



=========
I T A L Y
=========


CERVED TECHNOLOGIES: Moody's Assigns 'B2' CFR; Outlook Negative
---------------------------------------------------------------
Moody's Investors Service has assigned a corporate family rating
(CFR) of B2 and probability of default rating (PDR) of B1-PD to
Cerved Technologies S.p.A., the largest credit information
provider in Italy. Concurrently, Moody's has also assigned a
provisional (P)B2 rating with a loss given default (LGD)
assessment of LGD4 - 58%, to the group's proposed EUR550 million
of senior secured notes and a provisional (P)B3 rating with a
loss given default (LGD) assessment of LGD6 - 95%, to the group's
proposed EUR230 million of senior subordinated notes. The outlook
on all ratings is negative. This is the first time that Moody's
has assigned ratings to Cerved.

RATINGS RATIONALE

- B2 CFR

"The B2 CFR assigned to Cerved is constrained by the group's
relatively small size (EUR267 million as at FYE December 2011)
compared with its international peers, its lack of geographic
diversification and its exposure to the currently challenging
operating and economic environments in Italy," says Paolo
Leschiutta, a Moody's Vice President - Senior Credit Officer and
lead analyst for Cerved. "Moody's views Cerved's expected
financial leverage, following the proposed transaction, as
relatively high for the rating category and the rating assumes a
degree of deleveraging over the next twelve to eighteen months",
continued Mr. Leschiutta. The CFR assumes the transaction is
completed as expected including CVC Capital Partners obtaining
the authorities approval for the acquisition.

The rating is supported by (1) Cerved's established role as the
largest credit information provider in Italy, serving the largest
banks and some of the largest corporates in the country; and (2)
barriers to market entry provided by its reputation and long-
standing relationship with some of its customers. Cerved's
customer diversification, especially in the corporate segment, is
good with only modest revenues concentration. The group benefits
from a degree of revenues visibility as contracts with customers
range between one and three years and around 70% of revenues are
based on subscriptions. Moody's understands that customers can
exit existing contracts relatively rapidly, but also recognizes
that despite the challenging operating environment in Italy, the
performance of the group has remained resilient over recent
years.

Furthermore, the lack of business information services for
corporate customers in Italy should provide for growth
opportunities and compensate for the increasing pressure on
banking customers, which are increasingly cost sensitive and
might exit some of the more ancillary services. Moody's
acknowledges, nonetheless, that certain of Cerved products and
services have counter cyclical characteristics. For example, its
credit collection products that are in great demand, given the
significant increase in non-performing loans among Italian
financial institutions.

The group's business profile is offset by a relatively high
financial leverage. Pro-forma for the new capital structure
Moody's expects debt/EBITDA (adjusted for pension and leases) to
remain close to 6x and retained cash flow (RCF)/debt to remain
around mid to high single digit, positioning the company at the
low end of the B2 rating category. The rating agency notes,
however, the high EBITDA margin of the group, ca. 50% as at FYE
2011, which together with modest capex needs allow for strong
cash flow generation. In addition, Moody's would expect Cerved to
refrain from distributing dividends going forward and to generate
solid positive free cash flow on an ongoing basis. As a result,
the rating assumes that Cerved's financial leverage will reduce
over time towards 5x supporting the existing rating.

At the same time, Moody's notes the acquisition appetite of the
group and the fact that the Italian market remains highly
fragmented, which offers Cerved the opportunity to expand through
acquisitions. The rating agency would expect any transaction to
be modest in size and to be financed with internal cash
generation. The rating agency also notes that the company should
be able to drive immediate synergies from any acquisitions on the
back of its existing large database. Finally, the rating assumes
that the transaction will go ahead as planned or alternatively
the company will refinance its existing debt in a timely manner
given that a significant amount of debt (EUR139 million) matures
between September 2012 and March 2014.

- PROVISIONAL RATINGS ON PROPOSED NOTES

The group is planning to issue EUR550 million of senior secured
notes (EUR250 million of which floating rate due 2019 and EUR300
million fixed rate due 2020) and EUR230 million of senior
subordinated notes due 2021 to help financing the acquisition of
the group by CVC Capital Partners.

The (P)B2 rating assigned to the proposed EUR550 million of
senior secured notes, in line with the CFR, reflects the fact
that the notes will be contractually subordinated to a new EUR75
million super priority revolving credit facility but senior to
the EUR230 million subordinated notes, rated (P)B3. The secured
notes will be secured on a first-ranking basis against pledges on
shares of some of the group subsidiaries while subordinated notes
will be secured on a second-ranking basis by a pledge over the
shares of some of the group subsidiaries. The revolving credit
facility, in addition of the collateral securing the notes, will
be also secured by a special lien (privilegio speciale) granted
by Cerved Group S.p.A. and under the terms of the intercreditor
agreement in the event of an enforcement of the collateral, the
lenders under the revolving credit facility will receive proceeds
from such collateral before the holders of the notes.

The notes will not benefit from guarantees from operating
companies. However, after completion of the acquisition
management intends to merge Cerved Technologies S.pA. and Cerved
Holding S.p.A. with and into Cerved Group S.p.A. (with Cerved
Group S.p.A. as the surviving entity). Following the merger, the
issuer will represent approximately 94% of the group EBITDA.

Given the absence of maintenance financial covenants within
Cerved's new capital structure, in line with its standard
approach with covenant light structures, Moody's lowered its
corporate family recovery rate assumption to 35% (against the
standard 50%). This resulted in the PDR being one notch above the
CFR.

Moody's issues provisional ratings in advance of the final sale
of securities and these reflect Moody'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 proposed securities. A definitive rating and assigned LGDs
may differ from provisional ones.

OUTLOOK

The negative outlook reflects Moody's view that key credit
metrics are likely to remain weak for a B2 rating over the next
12 to 18 months and as a result the company will have modest
headroom to allow for any minor deterioration in key metrics
while market conditions remain challenging. A stabilization of
the outlook could follow the company's demonstrated ability to
reduce financial leverage to a more commensurate level for a mid-
B rating.

What Could Change The Rating UP/DOWN

Upward rating pressure is limited by the group small size and the
current difficult macroeconomic environment in Italy. A track
record of sustained profitability and positive free cash flow
that led to a gradual reduction in financial leverage could,
however, result in positive rating pressure over time. Upward
pressure on the rating could result if the company demonstrated
its ability to achieve and maintain over time a financial
leverage towards 4.5x and an RCF to debt above 15%.

Conversely, deteriorating operating profitability, resulting in
financial leverage, measured as debt/EBITDA, remaining
significantly above 5.5x on an ongoing basis or negative free
cash flow, could result in a rating downgrade. Moreover,
immediate downward rating pressure could result from
deterioration in the company's liquidity. The rating incorporates
Moody's assumption that Cerved will not make any large debt-
financed acquisition.

Principal Methodology

The methodologies used in this rating were Global Business &
Consumer Service Industry Rating Methodology published in October
2010, and Loss Given Default for Speculative-Grade Non-Financial
Companies in the U.S., Canada and EMEA published in June 2009.

Cerved Technologies, incorporated in Italy, is the largest credit
information provider to both corporate and banks in Italy. Along
with key credit and business information the company also
provides marketing information and credit collection services. As
at FYE December 2011 the company reported revenues of EUR264.4
million and EBITDA of EUR136.5 million. During the nine months
ending September 2012 the group generated EUR209 million of
revenues and EUR99.2 million of EBITDA.



=====================
N E T H E R L A N D S
=====================


NEW WORLD: Moody's Rates EUR275MM Senior Unsecured Notes '(P)B3'
----------------------------------------------------------------
Moody's Investors Service has assigned a provisional (P)B3 rating
with a loss given default (LGD) assessment of LGD6 - 90%, to New
World Resources N.V. (NWR) proposed EUR275 million of senior
unsecured notes. The group's B1 Corporate Family Rating (CFR) and
B1-PD Probability of Default Rating (PDR) remain unchanged. The
senior unsecured B3 rating on the existing EUR300 million notes
(EUR258 million outstanding) due in 2015 and the senior secured
Ba3 rating on the EUR500 million notes due in 2018 are also
unchanged. The new notes will be used to repay the existing notes
due 2015. The outlook on the ratings is stable.

Moody's issues provisional ratings in advance of the final sale
of securities and these reflect Moody'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 proposed senior bank facilities. A definitive rating and
assigned LGDs may differ from provisional ones.

Ratings Rationale

"NWR's B1 CFR and stable outlook reflect our view that despite
some expected deterioration in the company's key credit metrics
over the next six to twelve months, key financial ratios will
remain acceptable for the current rating category, while the
company should be able to weather the current difficult market
conditions and a potential reduction on financial covenants
headroom", says Paolo Leschiutta, a Moody's Vice President -
Senior Credit Officer and lead analyst for NWR. "In Moody's view,
mild temperature so far this winter and over supply of thermal
coal in the region are likely to have had a negative impact on
NWR's operating performance during the fourth quarter of fiscal
year-end (FYE) December 2012. This, together with sluggish market
condition overall in terms of steel demand in the region, is
likely to result in significant tightening of the financial
covenants' headroom during the current FYE December 2013",
continued Mr. Leschiutta.

While demand for coking coal and coke is expected to remain flat
at best over the short term, Moody's believes that oversupply of
thermal coal is likely to have resulted in a costly build up of
inventory towards the end of FYE December 2012. Shipment volumes
of thermal coal during 2012 declined by 19.2% compared to the
prior year. In light of the group high operating leverage, NWR's
profitability could remain at depressed level over the next six
to twelve months on a last twelve month basis, reducing headroom
on financial covenants. Nevertheless, financial leverage,
calculated as debt to EBITDA as adjusted by Moody's, is not
expected to exceed significantly 4x.

Financial covenants are contained in NWR's Export Credit Agency
(ECA) facility, outstanding for EUR85 million as at the end of
September 2012, and in the group EUR100 million revolving credit
facility (RCF), currently fully undrawn. Although Moody's takes
comfort from the company relatively high cash balances, Moody's
will continue to monitor closely the degree of deterioration that
lower profitability could have on the company's liquidity
profile.

Overall, NWR's B1 CFR reflects (1) the expected ongoing
volatility in the steel production market, which represents the
key revenue driver for NWR's most profitable coking coal and coke
businesses; (2) the high degree of customer and business
concentrations; and (3) NWR's significant operating risks in view
of the depth of its mines. These negative credit considerations
are offset by: (1) the company's strategic position as a major
player in its sector in Central Europe, benefitting from close
proximity to key customers; (2) a relatively ample reserve base;
and (3) the progress NWR has achieved in improving cost
efficiency and safety through its modernization programs. The
rating is also supported by the expectations that the company
will continue to generate relatively strong cash flow although
this might be impaired over the next six to twelve months by the
currently difficult market conditions.

The (P)B3 rating (LGD6 -- 90%) assigned to the proposed notes
issuance reflects the fact that the new notes, unsecured and with
no guarantees from operating companies, will have the same
seniority as the existing 2015 notes and therefore will be
subordinated to the rest of group's debt.

The notes due in 2018, instead, benefit from full guarantees
from, and are secured by share pledges of, NWR's main operating
subsidiaries. Although Moody's assigns a relatively low value to
the pledge on shares, the 2018 notes rank senior in terms of
security to the notes due in 2015 and the EUR85 million
(outstanding at September 2012) ECA loan, which do not benefit
from any guarantees from operating subsidiaries (although OKD is
a co-obligor under the agreement). The EUR100 million revolving
facility, currently fully drawn, ranks ahead of both bonds.

What Could Move The Rating UP/DOWN

The ratings could be upgraded if NWR demonstrated an ability to
weather potential cyclicality in the market and sustain a robust
financial profile, with financial leverage remaining below 3x and
CFO-dividends/debt in the high teens on an ongoing basis. Before
considering an upgrade Moody's would expect an improvement in the
company's liquidity profile.

Conversely, negative pressure could arise in case of further
deterioration in NWR's liquidity profile or market conditions.
Ratings could also be downgraded in the event that CFO-
dividends/debt diminished towards the low teens or if financial
leverage increased above 4x for a prolonged period of time.

Principal Methodology

The principal methodology used in rating NWR was the "Global
Mining Industry" rating methodology, published in May 2009. Other
methodologies used include "Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA",
published in June 2009.

Headquartered in the Netherlands, NWR is the largest hard coal
mining group in the Czech Republic and operates through its main
subsidiary OKD, a.s. The company reported revenues of EUR1.6
billion and EBITDA of EUR454 million during FYE December 2011.
The company exploits the Upper Silesian basin in the north-
eastern part of the Czech Republic and is expanding its activity
in Poland.


NEW WORLD: S&P Rates Proposed EUR275MM Sr. Unsecured Notes 'B'
--------------------------------------------------------------
Standard & Poor's Ratings Services said that it assigned its 'B'
issue rating to the proposed EUR275 million senior unsecured
notes due 2021, to be issued by The Netherlands-headquartered New
World Resources N.V. (NWR; BB-/Negative/--).  NWR is a holding
company for coal mining operations in the Czech Republic and
Poland.

The issue rating on the proposed notes is subject to both the
successful issuance and S&P's satisfactory review of the final
documentation.

The 'B' issue rating on the proposed senior unsecured notes is
two notches below the long-term corporate credit rating on NWR.
This reflects the notes' subordinated position in the capital
structure.  On the issue date, the proposed notes will not
benefit from any collateral or be guaranteed by any of the
issuer's subsidiaries, whereas the existing senior unsecured
notes due 2015 benefit from second-ranking pledges over NWR's
mining subsidiaries.

S&P understands that most of the proceeds will be used to repay
NWR's senior unsecured notes due 2015 (EUR258 million outstanding
on Dec. 31, 2012).

"We consider the transaction to be neutral for the corporate
credit rating on NWR.  The rating reflects NWR's ability to
offset weakening profitability, due to lower hard coking coal
prices, in the coming quarters through internal measures and
thanks to our view of its "adequate" liquidity position.  That
said, the main threat to NWR's liquidity under our base-case
credit scenario is a possible breach of covenants under the
company's revolving credit facility (RCF) and export credit
agency loan as early as the second quarter of 2013.  We would
anticipate a covenant beach if the price of hard coking coal--
NWR's most profitable mining product--remains less than $180 per
ton in the coming months.  However, at this stage, we do not give
a possible covenant breach much weight because the outstanding
amounts under the relevant debt instruments are relatively small
compared with the outstanding cash on the company's balance
sheet.  In addition, we think that the company could obtain
covenant waivers in the event of a breach," S&P said.

Recovery Analysis

Following the proposed notes issue and the refinancing of the
existing EUR258 million senior unsecured notes, NWR's capital
structure will consist of four debt instruments.  These
instruments are: EUR500 million of senior secured notes due 2018;
EUR275 million of proposed senior unsecured notes due 2021; a
EUR100 million fully available RCF due 2014; and a EUR78 million
amortizing export credit agency loan due 2018.  The RCF, together
with other priority liabilities, ranks ahead of the senior
secured and unsecured notes.

The proposed notes issue will contain a covenant that limits an
increase in the amount of debt in the capital structure unless
there is a material increase in EBITDA.

The issue rating on the senior secured notes is 'BB-', in line
with the corporate credit rating on NWR.  The notes are secured
by first-ranking share pledges on NWR's three main mining
operating subsidiaries, OKD, a.s., OKK Koksovny, a.s., and NWR
Karbonia S.A.  In addition, the three operating subsidiaries
provide upstream guarantees, which rank the secured notes at
least pari passu with unsecured liabilities at the operating
company level.  S&P views the senior secured notes' security
package as relatively weak because the noteholders have no
security over fixed or current assets.

The 'B' issue rating on the proposed senior unsecured notes
reflects the notes' subordinate position in the capital
structure.  The notes are secured by second-ranking share pledges
over the mining subsidiaries, with no upstream guarantees.

Any insolvency proceedings against NWR would most likely
originate in the Czech Republic and Poland.  Although the various
notes have issue ratings, S&P has not assigned recovery ratings
because its review of the insolvency regimes in the Czech
Republic and Poland is not complete.

RATINGS LIST

New Rating

New World Resources N.V.

Senior Unsecured Debt                   B


TELENET GROUP: Liberty Global Increases Ownership to 58%
--------------------------------------------------------
Liberty Global, Inc. on Jan. 14 disclosed that 9,497,637 ordinary
shares and 3,000 warrants were tendered into the voluntary and
conditional cash offer (the "Offer") launched by its wholly-owned
subsidiary Binan Investments B.V. on December 18, 2012 (Brussels
time) for the outstanding shares and other securities giving
access to voting rights of Telenet Group Holding NV that it did
not already own and that were not held by Telenet.  The official
announcement of the results in the Belgian financial press, in
accordance with article 32 of the Belgian Royal Decree of April
27 on public takeover bids, will take place on January 18, 2013
(Brussels time).  Subject to satisfaction (or waiver) of the
conditions to the Offer on that date, this official announcement
will also confirm Binan's acceptance of the tendered shares and
warrants and whether or not a voluntary reopening of the Offer
will be made.  Payment on tendered shares and warrants is
intended to take place on February 1, 2013 (Brussels time).

Following acceptance of the tendered shares, Liberty Global will
hold 66,342,037 shares(1) and 3,000 warrants in Telenet.  This
represents approximately 58.4% of the issued and outstanding
shares of Telenet (excluding the 220,352 treasury shares held by
Telenet).

Liberty Global notes that as stated in the prospectus for the
Offer, it intends to align the strategy and the operations of
Telenet with the rest of the Company.  Liberty Global is
reviewing the current organization, governance and reporting
structure at Telenet with the intention of effecting a closer
management integration of Telenet within its European operations.
Telenet's leverage policy will be aligned with that of Liberty
Global such that target leverage will be 4.0 to 5.0x net total
debt to annualized EBITDA (excluding financial leases) and may
increase the indebtedness of Telenet to a level greater than this
range.

Mike Fries, President and Chief Executive Officer of Liberty
Global, commented: "We remain committed to investing in growth
opportunities for Telenet, maintaining its position as a leading
innovator in the Belgian market, and delivering best-in-class
services to its customers.  We believe that this is the right
time for Telenet to be more closely integrated within our pan-
European platform and in an environment where scale is paramount,
we believe that closer integration will benefit all Telenet
stakeholders."

Telenet Group Holding NV is a Belgium-based provider of media and
communication services to the public and private sectors.

                       *     *     *

As reported by the Troubled Company Reporter on November 13,
2012, Moody's Investors Service corrected the probability of
default rating (PDR) of Telenet Group Holding NV to B1 from
B1/LD.  The PDR was appended with the "/LD" symbol on August 21,
2007 due to an internal administrative error.

The complete corrected rating history is as follows:

  March 29, 2007 -- B1 rating assigned

  August 21, 2007 -- rating downgraded to B2

  May 16, 2008 -- rating upgraded to B1.


UCL RAIL: S&P Assigns 'BB+' Longterm Corporate Credit Rating
------------------------------------------------------------
Standard & Poor's Ratings Services said that it assigned its
'BB+' long-term corporate credit rating and its 'ruAA+' Russia
national scale rating to Russian freight rail operator UCL Rail
B.V.  The outlook is stable.

The rating reflects S&P's assessment of UCL Rail's "fair"
business risk profile and "intermediate" financial risk profile.

"The rating on UCL Rail is constrained by our view of the revenue
volatility inherent in freight transportation, which is closely
linked to the volatility of the commodity dependent Russian
economy.  The rating also reflects some uncertainty connected
with the liberalization of the rail transportation market, which
we consider could lead to an increase in competition in the
medium term," S&P said.

"These weaknesses are partly mitigated by UCL Rail's strong
position in the Russian freight rail transportation market, which
we expect to continue to post healthy growth, in line with our
projection of GDP growth in Russia.  An additional strength is
the company's well-diversified customer base in different end-
markets, which provides a degree of revenue stability.  These
factors translate into a track record of sound cash flow and
strong Profitability," S&P added.

UCL Rail acquired Russia's biggest freight rail operator Freight
One (JSC) from Russia's national railroad company JSC Russian
Railways (BBB/Stable/--).  UCL Rail is a wholly owned subsidiary
of Universal Cargo Logistics Holding B.V. (UCL Holding; not
rated), a private investment holding company of Russian
transportation and logistics assets, including ports, and
shipping and rail businesses.  S&P understands that all UCL
Holding's subsidiaries operate and finance themselves on an
independent basis and that there is no cross-funding between the
affiliated companies.

In S&P's view, UCL Rail's resilient earnings and free operating
cash flow capacity will support gradual deleveraging after its
recent acquisition of the remaining stake of Freight One.  This
will help UCL Rail maintain its adjusted ratio of debt to EBITDA
between 1.5x and 2.0x.

S&P might consider taking a negative rating action if UCL Rail's
adjusted debt-to-EBITDA ratio exceeds 2x.  This could result from
extensive growth-related investments beyond S&P's current base-
case assumptions and/or aggressive shareholder distributions
resulting in negative discretionary cash flow.  It could also
occur if the company undertakes further acquisitions.

S&P could consider taking a positive rating action if the company
reaches and sustains adjusted debt to EBITDA of less than 1.5x
and if it implements a more conservative financial policy,
provided that our assessment of liquidity remains "adequate."



===========
N O R W A Y
===========


NOTABENE: Lesi AS to Take Over 110 Stores Covered by Bankruptcy
---------------------------------------------------------------
Views and News from Norway reports that Notabene, one of Norway's
largest chains of bookstores, is being formally taken over by a
new company that's wholly owned by DNB, the country's biggest
bank and Notabene's major creditor.

The company filed for bankruptcy last week, six years after its
founders sold a majority stake to an investment fund, Views and
News relates.

According to Views and News, newspaper Dagens N‘ringsliv (DN)
reported Tuesday that Havard Wiker, bankruptcy administrator for
Notabene, was in negotiations to find new owners for the chain
Monday night.  The estate later issued a statement saying that
Notabene will be acquired by the newly created Lesi AS, 100%
owned by DNB Bank ASA, Views and News recounts.

An earlier agreement between DNB Bank and the Notabene bankruptcy
estate, struck just after the bankruptcy filing, allowed all of
Notabene's 139 retail outlets to remain open and continue doing
business as usual, Views and News discloses.  Now Lesi will take
over 110 of the 139 Notabene stores covered by the bankruptcy
filing, Views and News says.

There reportedly was great interest in parts of the chain, but
the deal with Lesi/DNB Bank secures a much larger portion of it
and its roughly 1,000 employees than the alternatives Wiker
otherwise was facing, Views and News notes.

It is believed Notabene, which is not affiliated with a book
publishing company (forlag) like many other Norwegian bookstore
chains are, owed DNB around NOK300 million, and that DNB's Lesi
AS will now search for a more permanent owner of the chain, Views
and News states.

Notabene is one of Norway's largest chains of bookstores.  It was
originally founded by entrepreneur Rune Nicolaisen and his
brother-in-law in 1985.



===========
P O L A N D
===========


LOT POLISH: Gov't Mulls Downsize to Restore Profitability
---------------------------------------------------------
Marcin Sobczyk at The Wall Street Journal reports that Poland
Treasury Minister Mikolaj Budzanowski said the government plans
to reduce the size of LOT Polish Airlines by nearly a half as it
seeks to make the company profitable again, only days after the
airline received a US$127 million emergency loan from the state
and shed more assets to stay afloat.

LOT said in December it needed state aid because Europe's
economic woes had dented its passenger numbers in the second half
of the year, the Journal recounts.  Instead of profits, the
airline said it would generate heavy losses for 2012, the Journal
relates.

Poland gave its national airline the cash on Dec. 21, allowing
the company to keep operating, the Journal discloses.  The
European Commission may yet rule that the loan is a form of
illegal state aid that distorts competition, which would force
LOT to return the funds and likely file for bankruptcy, the
Journal notes.

According to the Journal, the government, which holds 93% of
LOT's shares, said it would save the company with a plan to
restructure and eventually privatize it, although Prime Minister
Donald Tusk said it wouldn't try to save the firm at any price.

LOT's chief executive, Marcin Pirog, was ousted soon after the
airline made its request for public aid, the Journal relates.

Mr. Budzanowski told the parliament that as part of the
restructuring, LOT will return nearly half of its fleet to
leasing companies and focus only on the most profitable routes
and cost-effective airplanes, while another airline, also
controlled by the government, will take over LOT's domestic and
some European flights, the Journal relates.

LOT's loss last year is now expected to have reached
PLN200 million (US$63.7 million), half the amount of the loan the
company received in December, the Journal notes.  According to
the Journal, Mr. Budzanowski, said that until August 2012 it had
appeared the company would generate a profit, but in the third
quarter it saw "an abrupt reduction, by 20%, of the number of
passengers using air transport."

Headquartered in Warsaw, Poland, Polskie Linie Lotnicze LOT, or
LOT Polish Airlines -- http://www.lot.com/-- serves about a
dozen cities in Poland and about 120 destinations across Europe
and North America.  Subsidiaries include regional carrier EuroLOT
and charter operator Centralwings.  Overall, LOT and its
affiliates maintain a fleet of about 55 aircraft, consisting of
Embraer regional jets, Boeing 767s and 737s, and ATR turboprops.
The airline is a member of the Star Alliance marketing group, and
LOT serves many of its North American destinations through code-
sharing with Star partners United Airlines and Air Canada.
(Code-sharing allows airlines to sell tickets on one another's
flights and thus extend their networks.)  The Polish government
owns 68% of the company.



=============
R O M A N I A
=============


HIDROELECTRICA: Expects to Exit Insolvency by End-June
-----------------------------------------------------
SeeNews reports that Hidroelectrica could exit insolvency by end-
June and expects to turn to profit this year.

According to SeeNews, Remus Borza, a partner at the company's
administrator EuroInsol, as cited by SeeNews, said, "The date set
by the court in Bucharest is at the end of June, when we hope to
file a request to close the proceedings".

In order to exit insolvency, Hidroelectrica has to secure about
EUR300 million (US$400 million) to repay debts towards unsecured
creditors, SeeNews discloses.

As a result, Hidroelectrica has reduced its investment budget for
2013 to EUR120 million from EUR300 million last year, SeeNews
relates.

Hidroelectrica has drafted its 2013 budget based on an annual
production target of 13 terawatt-hours (TWh), in line with the
poor hydrological conditions forecast for this year, SeeNews
recounts.

Hidroelectrica is a Romanian state-owned hydropower producer.



===========
R U S S I A
===========


FREIGHT ONE: S&P Affirms 'BB+' Rating; Outlook Stable
-----------------------------------------------------
Standard & Poor's Ratings Services said that it revised the
outlook on Russia-based freight rail operator Freight One (JSC)
to stable from negative.  At the same time, S&P affirmed its
'BB+/B' long- and short-term global scale and 'ruAA+' Russia
national scale corporate credit ratings on the company.  S&P
subsequently withdrew the ratings at the issuer's request.

The outlook revision reflects S&P's understanding that Freight
One has cut its capital expenditure (capex) plans substantially.
It also reflects S&P's view that the company will improve its
profitability as a result of operational synergies with the other
businesses of its parent, UCL Rail (BB+/Stable/--), together with
cost-control initiatives.  The improvement in profitability was
evident in an increase in the company's consolidated EBITDA
margin for the first six months of 2012.

In December 2012, UCL Rail completed its acquisition of the
remaining 25% of Freight One from Russian Railways (JSC)
(BBB/Stable/--).  UCL Rail assumed additional debt of Russian
ruble (RUB) 49 billion to finance the transaction.  "We
understand that this debt, together with a RUB75 billion loan
that UCL Rail raised in 2011, accounted for the majority of
consolidated debt at year-end 2012.  Despite the recent increase
in debt, we think that control over discretionary spending and a
continued track record of healthy cash flow generation will help
the consolidated group prevent its leverage surpassing 2x debt to
EBITDA," S&P said.

"At the time of the withdrawal, our 'BB+' rating on Freight One
reflected our assessment of its business risk profile as "fair"
and its financial risk profile as "intermediate."  We based these
assessments on our view of Freight One's market-leading position
in the Russian freight rail industry, owing to its large size and
market presence; its well-diversified customer base; and its
extensive area of operations.  These strengths were partially
offset by the uncertainty created by ongoing market
liberalization, and revenue volatility associated with the
freight rail business in general," S&P added.


FREIGHT JSC: Fitch Withdraws Low-B Ratings on Acquisition
---------------------------------------------------------
Fitch Ratings has revised the Outlook on, affirmed, and
simultaneously withdrawn JSC Freight One's ratings.

The rating actions follow the full acquisition of Freight One by
UCL Rail B.V. (UCLR, 'BB+'/Positive/'B'). Despite some legacy
loans and finance leases at Freight One, the group will be
primarily funded at UCLR level.

The rating actions are:

* Long-term Issuer Default Rating (IDR) affirmed at 'BB+';
   Outlook revised to Positive from Negative; withdrawn

* Short-term IDR affirmed at 'B' and withdrawn

* Local currency long-term IDR affirmed at 'BB+'; Outlook
   revised to Positive from Negative; withdrawn

* Local currency short-term IDR affirmed at 'B' and withdrawn

* National long-term rating affirmed at 'AA(rus)'; Outlook
   revised to Positive from Negative; withdrawn


GAZPROM: Fitch Says Weak European Sales Likely to Continue
----------------------------------------------------------
Gazprom's sales are likely to fall further in 2013 as weak
economic conditions lead to continued low demand in Europe, the
company's key market for natural gas, Fitch Ratings says.
"Russian gas production data for 2012 indicate that Gazprom's
European and FSU gas sales fell slightly more than we expected,"
Fitch relates.

"Europe and the FSU remain key markets for Gazprom, which has a
monopoly on the export of Russian natural gas. For example, in
H212 it generated over 76% of its revenue from sales of gas
outside of the Russian Federation, which accounted for only 44%
of its gas sales by volume. The drop in European gas volumes and
prices was partly caused by litigation by some of its European
gas buyers, and price renegotiations and compensation payments
that followed. This shows that Gazprom's position in Europe
remains somewhat challenging, as we highlighted in "2013 Outlook:
EMEA Oil and Gas", published on December 13, 2012," according to
Fitch.

Fitch says, "We nonetheless believe that prices and volumes of
European gas consumed under take-or-pay arrangements will not
dramatically change in the foreseeable future. Take-or-pay
provisions usually cover 80% of contractual gas volumes;
therefore there is some headroom for gas volumes to fall before
triggering the take-or-pay clauses. Gazprom's concessions to
European buyers represented no more than 10%-15% of the total
oil-based price, leaving the prices under these contracts well
above market gas prices, which are now almost delinked from the
oil price. Our view is that Gazprom will have to continue
negotiating further concessions with those European buyers that
may have alternative sources of gas supply.

"We forecast that eurozone GDP will contract by 0.1% in 2013,
following an expected 0.5% contraction in 2012. The trend should
reverse in 2014, when we forecast 1.2% GDP growth. We expect that
gas demand in Europe will continue to be weak in 2013 and may
start increasing in 2014.

"The market abuse investigation, launched into Gazprom last
autumn by the European Commission, also continues. We do not
forecast any rating implications for the company as a result of
this investigation, but it may eventually weaken Gazprom's
negotiating position with some of its key European buyers, and
have a long-term financial impact.

"Last week the Russian Ministry of Energy said that total natural
gas production in the country fell by 2.2% in 2012 to 655 billion
cubic meters (bcm), while Gazprom's gas production declined by
5.1% to 482bcm. Russian gas sales abroad in 2012, mainly to
Europe and the FSU, fell by 8.7% to 186bcm. Gazprom previously
reported a 10% volume drop in H112 sales to Europe and a 29%
volume drop in sales to the FSU countries," Fitch adds.


UCL RAIL: Fitch Assigns 'BB+' LT Issuer Default Rating
------------------------------------------------------
Fitch Ratings has assigned UCL Rail B.V. a Long-term foreign
currency Issuer Default Rating (IDR) of 'BB+'. The Outlook is
Positive.

The ratings reflect UCLR's position as the leading rolling stock
owner and operator in Russia's rail freight market. The sizeable
asset base provides UCLR with a strong ability to execute
customer demand and a diversified fleet and customer base. This
supports its strong profitability and operating cash flows.
However, UCLR's business is exposed to volatile economic drivers
affecting both volumes transported and freight rates. Fitch
expects UCLR to report leverage around 2.1x (net adjusted debt to
funds from operations; FFO) at YE12 and reduce it from 2013,
helped by strong operating cash flow, low capex (focused on
maintenance and asset life extension) and zero dividend policy.
The Positive Outlook reflects the expected deleveraging.

KEY DRIVERS

Freight One Acquisition
UCL purchased a 75% stake in JSC Freight One from JSC Russian
Railways (RZD; 'BBB'/Stable/'F3') in December 2011 for RUB125.5
billion, and the remaining 25% in December 2012 for RUB50
billion. A total of RUB117 billion of the total acquisition price
was external debt funded and the acquisition debt represents the
majority of UCL's consolidated debt, which led to a post-
acquisition leverage of around 2.1x. Together with the pre-
acquisition fleet of around 30,000 wagons, UCLR now owns 210,000
wagons in Russia and CIS.

Strong Competitive Position
UCLR is the leading nationwide commercial rolling stock operator
in Russia by fleet size (around 21% of the market, 2011 pro-
forma), transportation volumes (around 23%), and turnover (26%).
The company has a diversified fleet and customer base, which
along with a broad network of regional branches secure its
competitive advantage and efficiency over smaller market players.
However, these advantages might become less obvious in the medium
term, as Fitch expects that competition in the sector will
possibly intensify due to consolidation of the market in the
coming years.

Elevated Volume Risks
UCLR's strengths are partially offset by the company's exposure
to cyclical commodity industries (coal, oil and building
materials account for approximately three-quarters of total
volume transported) and above-average exposure to lower tariff
cargoes (e.g. coal). Fitch assesses UCLR's volume risk as
elevated, although this is mitigated by a comparatively low share
of fixed costs in the company's cost structure.

Moderate market expectations
In Russia, railroads remain the main method of cargo
transportation, accountable for as much as 85% of total freight
turnover (excluding pipelines). The growth of rail freight
turnover has been on average 1% below that of real GDP since
2002. The agency expects real GDP to grow by around 4% both in
2012 and 2013, and rail freight turnover is likely to increase by
1%-2% yoy, assuming limitations of existing railroad
infrastructure.

Traffic May Curb Growth
Further growth of the market may be constrained by a reduction in
the efficiency of the Russian railway infrastructure, which
remains in full control of the state through RZD. The rising
numbers of wagons (at points beyond the system's capacity)
spurred by market liberalization and rising demand for cargo
transport have resulted in congestion and reduced average speed,
limiting potential volume growth. Fitch believes that this could
affect UCL's future growth prospects.

Positive Outlook Reflects Expected Deleveraging
UCLR currently has a significant debt level. However, we expect
that the company's debt burden will ease over the short to medium
term to the levels commensurate with a low-BBB category. This
should be driven by stable operating profitability, moderate
capex needs and zero dividend policy allowing for gradual debt
repayment. Fitch forecasts leverage to go down to around 1.7x at
YE13 and to around 1.1x at YE14. The agency expects FFO interest
coverage to increase from 5.0x in 2012 and 4.3x in 2013 to 6.2x
in 2014. Once the company has established a track record of its
financial policy and reduced leverage as expected, Fitch would
consider a positive rating action.

LIQUIDITY

Adequate Liquidity
At YE12 the liquidity was supported by RUB44 billion of cash
compared to around RUB50 billion of debt and finance leases due
in 2013. Fitch-expected free cash flow for 2012-2014 is positive.
The company has no committed unutilized facilities, unused
facilities stood at RUB6.5 billion.

RATING SENSITIVITY GUIDANCE:

Positive: Future developments that could lead to positive rating
actions include:

- Lower Debt Level: Stronger credit metrics - leverage (measured
   as net adjusted debt to FFO) falling comfortably below 2.0x
   and FFO interest cover rising above 5x on a sustained basis,
   could result in a positive rating action assuming unchanged
   business risk profile.

Negative: The current Outlook is Positive. As a result, Fitch's
sensitivities do not currently anticipate developments with a
material likelihood, individually or collectively, of leading to
a rating downgrade. Future developments that may nonetheless
potentially lead to a negative rating action include:

- More Aggressive Financial Profile: Inability to reduce the
   debt burden in the short-to-medium term due to weaker-than-
   expected operating results, larger capex or dividend payments
   could result in a negative rating action (revision of the
   Outlook to Stable).

The rating actions are:

* Long-term foreign currency IDR assigned at: 'BB+', Positive
   Outlook

* Short-term foreign currency IDR assigned at: 'B'

* Senior unsecured rating assigned at: 'BB+'

* Long-term local currency IDR assigned at: 'BB+', Positive
   Outlook

* Short-term local currency IDR assigned at: 'B'

* Local currency senior unsecured rating assigned at: 'BB+'

* National Long-term rating assigned at: 'AA(rus)', Positive
   Outlook


VNESHPROMBANK: S&P Raises Counterparty Credit Rating to 'B'
-----------------------------------------------------------
Standard & Poor's Ratings Services said that it has raised its
short-term counterparty credit rating on Russian Foreign Economic
Industrial Bank (Vneshprombank) to 'B' from 'C'.  At the same
time, S&P affirmed its 'B' long-term counterparty credit and
'ruA-' Russia national scale ratings on the bank.  The outlook is
stable.

The raising of the short-term rating reflects S&P's assessment of
Vneshprombank's liquidity position as "strong" under our
criteria, and assumes that the bank will make no substantial
changes to its conservative liquidity management in 2013.  S&P
believes that the bank has stronger liquidity ratios and market
indicators than most of its other rated domestic peers.

Vneshprombank is a midsize Russian bank with total assets of
Russian ruble (RUB) 113 billion as of Dec. 1, 2012 (under Russian
accounting standards).  Vneshprombank primarily focuses on
corporate banking and has high revenue and funding concentrations
on a limited number of large corporate clients.  The largest
depositor accounted for 23% of total deposits at Dec. 1, 2012.
Moreover, as of the same date, 16% of total liabilities were
demand deposits.  This renders the bank vulnerable to the
potential unexpected loss of a single corporate depositor.
However, in S&P's view, these risks are mitigated to a
significant extent by the bank's sizable liquidity cushion and
track record of efficient liquidity management.  Cash and money
market instruments--mostly in accounts with large foreign banks--
made up almost 30% of total assets at Dec. 1, 2012, which is
large and significantly above peers.  Besides, the bank grants
mostly working capital short-term loans, which S&P notes leads to
higher asset turnover and better predictability of loan payouts.
S&P anticipates that the bank will maintain its ample liquidity
cushion in 2013, which will limit refinancing risks.

"We consider the bank's funding profile to be "average" under our
criteria.  Our view balances the aforementioned depositor
concentrations against a low loan-to-deposit ratio of 76% on
Dec. 1, 2012, and limited use of wholesale debt (11% of total
assets).  Vneshprombank redeemed a RUB1.5 billion bond in
November 2012 and successfully placed a five-year bond for the
same amount in December 2012.  Funding from the Russian Central
Bank accounted for a nominal 2.5% of total assets as of Dec. 1,
2012, and was fully covered by the funds held in the
corresponding Central Bank account," S&P said.

In addition to S&P's assessments of Vneshprombank's "strong"
liquidity and "average" funding, S&P's ratings reflect its 'bb'
anchor for a commercial bank operating only in Russia, the bank's
"weak" business position, "moderate" capital and earnings, and
"moderate" risk position, as its criteria define these terms. S&P
assesses the bank's stand-alone credit profile (SACP) at 'b'.

The stable outlook on Vneshprombank reflects S&P's expectation
that the bank will gradually strengthen its business position by
expanding its branch network and attracting more corporate
clients, while maintaining capital adequacy and liquidity at
least at current levels.

"We could raise the ratings if continuing business expansion and
diversification is supported by internal capital generation or
additional capital from the shareholders, and if the bank
maintains its current asset quality and diversifies its sources
of funding," S&P said.

"We could lower the ratings if capital adequacy erodes, causing
the risk-adjusted capital ratio before adjustments to fall to
less than 5.0%, if rapid growth triggers additional asset risks,
or if the bank's funding and liquidity deteriorates.  However, we
do not assume these developments in our base-case scenario," S&P
added.



===========
S W E D E N
===========


SAAB AUTOMOBILE: U.S. Unit Has Secure Program for Vehicle Owners
----------------------------------------------------------------
Saab Automobile Parts North America (SPNA) on Jan. 10 announced
its Saab Secure program.  The program was developed to support
those 2010 and 2011 model year Saab owners left without warranty
coverage due to the bankruptcy of Saab Automobile AB in Sweden.

All 2010 and 2011 model year Saab vehicle owners are eligible to
come in for a no charge initial oil change and service, which
includes BG Products, Inc. engine oil additives.  This service
initiates the Limited Lifetime Protection Plan backed by BG.  As
long as the owner continues to service their vehicle within the
required intervals and at a Saab Official Service Center, the
protection plan will continue for the life of the vehicle.

In addition to the Limited Lifetime BG Protection Plan, Saab
Secure will offer 2010 and 2011 model year vehicles, with up to
70,000 miles, a menu of Saab Secure vehicle service contracts
that provide extended coverage levels and terms at affordable
prices. Coverage is available from Basic Care powertrain coverage
to Premier Care comprehensive component coverage, and is
available in terms from 1 to 5 years from the date of contract
purchase.  These products are being launched in partnership with
Pablo Creek Services, Inc.

"Just over a year ago the news was not good.  Saab owners in
North America and globally had just learned of the bankruptcy of
one of the world's most cherished automobile brands," said Tim
Colbeck, President and CEO of SPNA.  "Today they are hearing some
good news about parts, service and vehicle coverage.  It is news
Saab owners and the Saab network deserve, and I'm pleased to
announce our new programs and partner companies, who are all
committed to serving Saab owners in North America."

The news follows the announcement last month that SPNA and GM
entered into a Warranty Services Agreement that authorizes SPNA
to provide warranty administration and related services through
SPNA's network of Warranty Service Providers for model year 2009
and prior Saab vehicles still covered under the GM limited
warranty.

The Saab Secure program launch marks the culmination of a busy
startup period for SPNA.  In the spring of 2012, Saab Automobile
Parts AB in Sweden established SPNA as its North American
subsidiary.  In early June 2012, SPNA purchased the remaining
parts inventory from the Saab Cars bankruptcy estate and began
operations in North America. Since then, SPNA has:

  -- Established a network of 179 Official Service Centers in the
     US and Canada;

  -- Returned availability of Saab parts back to the high levels
     that existed prior to the Saab Automobile AB bankruptcy;

  -- Entered into an agreement with General Motors to administer
     warranty services on 2009 and prior model years, providing a
     seamless warranty experience for those Saab owners;

  -- Launched the Saab Secure program to support owners of 2010
     and 2011 Saab models;

  -- Launched a North America Technical Assistance Center to
     provide technical help for Saab Service Centers in providing
     high quality repairs for Saab owners;

  -- Launched a North America Customer Assistance Center on
     January 7, 2013 to support all Saab customers in North
     America needing assistance with inquiries about parts,
     accessories, service and technical support; and

  -- Launched a new SPNA website, Saab.com and Facebook page
     www.facebook.com/Saab to share up to date information about
     the company, service facilities and current promotions.

"The company has been working hard to build an infrastructure for
the future.  It's great that we are now able to launch these new
programs, providing added support to Saab owners and the Saab
service network.  We want to keep Saab cars and owners on the
road well into the future," Mr. Colbeck concluded.

            About Saab Automobile Parts North America

Saab Automobile Parts North America was founded to ensure Saab
owners in North America are supported with Genuine Parts,
Accessories, Technical Support and Repair Service for years to
come. SPNA is a DBA for North America Distribution Services, a
new company, separate and independent from the Saab Automobile
companies that entered bankruptcy in 2011 and 2012.

The company is headquartered in suburban Detroit, Michigan; and
operates a 153,000 square foot parts warehouse in Allentown,
Pennsylvania.  There are approximately 40 employees and
contractors in the company.

Ownership

SPNA is a wholly owned subsidiary of Saab Automobile Parts AB, a
global spare parts and logistics company, headquartered in
Sweden. Saab Automobile Parts AB in Sweden was part of the Saab
Cars family of companies.  However, unlike Saab Automobile AB,
Saab Automobile Parts AB did not enter bankruptcy.  The company's
shares are now fully owned by the Swedish government, who
recently formalized their ownership interest.  The company has
been placed with the Ministry of Finance which currently runs
about 36 companies out of the 55 companies wholly or partly owned
by the Swedish government.  The government has stated their
intention is to be a stable owner and develop the company
further.

Network

SPNA currently has 179 Official Service Centers throughout North
America, many of whom are former Saab dealers. The network
continues to expand as the company identifies areas where Saab
owners could use more support.  A full listing of Saab Official
Service and Parts Centers is available on Saab.com.

Products and Services

SPNA is the exclusive authorized distributor to the North
American market of the full line of Genuine Saab Parts and
Accessories.  In addition, they are the exclusive provider of
Genuine Saab Service through its network of Saab Official Service
and Parts Centers.

           About Saab Automobile AB and Saab Cars N.A.

Saab Automobile AB is a Swedish car manufacturer owned by Dutch
automobile manufacturer Swedish Automobile NV, formerly Spyker
Cars NV.  Saab halted production in March 2011 when it ran out of
cash to pay its component providers.  On Dec. 19, 2011, Saab
Automobile AB, Saab Automobile Tools AB and Saab Powertain AB
filed for bankruptcy after running out of cash.

Some of Saab's assets were sold to National Electric Vehicle
Sweden AB, a Chinese-Japanese backed start-up that plans to make
an electric car using Saab Automobile's former factory, tools and
designs.

On Jan. 30, 2012, more than 40 U.S.-based Saab dealerships filed
an involuntary Chapter 11 petition for Saab Cars North America,
Inc. (Bankr. D. Del. Case No. 12-10344).  The petitioners,
represented by Wilk Auslander LLP, assert claims totaling US$1.2
million on account of "unpaid warranty and incentive
reimbursement and related obligations" or "parts and warranty
reimbursement."  Leonard A. Bellavia, Esq., at Bellavia Gentile &
Associates, in New York, signed the Chapter 11 petition on behalf
of the dealers.

The dealers want the vehicle inventory and the parts business to
be sold, free of liens from Ally Financial Inc. and Caterpillar
Inc., and "to have an appropriate forum to address the claims of
the dealers," Leonard A. Bellavia said in an e-mail to Bloomberg
News.

Saab Cars N.A. is the U.S. sales and distribution unit of Swedish
car maker Saab Automobile AB.  Saab Cars N.A. named in December
an outside administrator, McTevia & Associates, to run the
company as part of a plan to avoid immediate liquidation
following its parent company's bankruptcy filing.

On Feb. 24, 2012, the Court granted Saab Cars NA relief under
Chapter 11 of the Bankruptcy Code.

Donlin, Recano & Company, Inc., was retained as claims and
noticing agent to Saab Cars NA in the Chapter 11 case.

On March 9, 2012, the U.S. Trustee formed an official Committee
of Unsecured Creditors and appointed these members: Peter Mueller
Inc., IFS Vehicle Distributors, Countryside Volkwagen, Saab of
North Olmstead, Saab of Bedford, Whitcomb Motors Inc., and
Delaware Motor Sales, Inc.  The Committee tapped Wilk Auslander
LLP as general bankruptcy counsel, and Polsinelli Shughart as its
Delaware counsel.



=============
U K R A I N E
=============


AEROSVIT: Enters Restructuring Period Following Bankruptcy
----------------------------------------------------------
Center for Aviation reports that Aerosvit has entered a period of
restructuring after filing for bankruptcy on Dec. 28.

According to CAPA, at the core of the airline's reorganization is
a large network shake-up which will see rival Ukrainian carrier
Ukraine International Airlines (UIA) take over nearly its entire
international network.

CAPA notes that While UIA stands to benefit significantly, adding
at least 30 routes, Aerosvit's operations will significantly
reduce in size.  If it survives the bankruptcy, Aerosvit will be
left as primarily, or perhaps entirely, a domestic operator, CAPA
states.

Aerosvit hopes to continue operating during its reorganization,
which is aimed at restoring the airline's operational efficiency
and improving profitability, and retain five medium-haul and
five-long haul international routes, CAPA discloses.  But the
airline's ongoing operations have been disrupted with incidents
involving its aircraft being impounded at various airports
causing issues across its network, CAPA notes.

According to CAPA, Aerosvit's financial difficulties are
substantial, with the airline owing UAH4.27 billion (EUR403
million) to its creditors as of December 27, 2012.  The airline's
total assets amounted to UAH1.47 billion (EUR138.7 million) as at
September 30, 2012, CAPA discloses.

Aerosvit is a private Ukrainian airline.  It was founded in 1994
and by 2012, was operating 80 international routes in 34
countries.



===========================
U N I T E D   K I N G D O M
===========================


BOSAL UK: Goes Into Administration
----------------------------------
typress.com reports that Bosal UK has entered administration.

Various news sources report that calling in the administrators
follows the recent confirmation of a contract to supply Land
Rover with the exhaust systems for its popular Evoque model,
according to typress.com.

The report relates that Bosal UK issued a statement appointing
Phillip Duffy -- philip.duffy@duffandphelps.com -- and David
Whitehouse -- david.whitehouse@duffandphelps.com -- of Duff &
Phelps Ltd, Manchester as administrators in a move that follows
"a decade of strong support for Bosal UK from its owners in the
face of a mix of factors which over time increasingly impacted on
its viability".

Bosal UK is best known as an exhaust manufacturer but also makes
roof racks and towbards.


DUBAI GROUP: Settles Restructuring Rift; Banks Sell Back Debt
-------------------------------------------------------------
Nicolas Parasie, writing for Dow Jones Newswires, reports that
two people familiar with the matter said Dubai Group and four
international banks have agreed to resolve their legal
differences in a push to finish a US$10 billion debt
restructuring.

Commerzbank, Royal Bank of Scotland, Standard Bank and Egypt's
Commercial International Bank in September took legal action
against Dubai Group after nearly two years of fruitless debt
negotiations.  The two sources told Dow Jones that, pursuant to
the settlement, the four banks have agreed to sell their loans to
Dubai Group at 18.5 cents on the dollar and drop their legal
action in the London Court of International Arbitration.  The
offer relates to a US$1.5 billion Islamic syndicated loan to
Dubai Group in 2008 that includes 18 other banks.  All remaining
banks involved in the loan need to approve the new offer to the
four banks for it to go through, the report says.

"There has been an agreement between the dissenting banks and
Dubai Group. That agreement is now being put to the other members
of the same syndicate," said one of the people familiar with the
matter, according to the report.

The report recounts Dubai Group began restructuring talks with
bank creditors last year; about US$6 billion of the debt under
restructuring is owed to banks, while the remainder is
intercompany loans.

According to Dow Jones, a second person familiar with the matter
said the recent developments illustrate how international lenders
were keen on exiting their loans earlier, while local lenders,
often bearing larger exposures to government-related entities
such as Dubai Group, were pushing to have the debt repayments
extended over longer periods to allow them to delay the full
effect of the restructuring instantly on their financial
position.

Dubai Group is a division of Dubai Holding, a conglomerate owned
by Dubai's ruler, Sheikh Mohammed bin Rashid al Maktoum.  Dubai
Group is a holding company with interests in property and
financial services.


HMV: In Administration, 4,000++ Jobs at Risks
---------------------------------------------
The Independent reports that more than 4,000 jobs will be under
threat today as HMV, the beleaguered entertainment chain HMV,
collapses into administration, which could signal the end of its
92-year presence on the high street.

The retailer will appoint the accountancy firm Deloitte as
administrator.

The demise of HMV, which employs 4,350 staff, comes just days
after the camera chain Jessops shut all its 187 stores and the
electrical retailer Comet disappeared from the high street before
Christmas, according to the report.

The report relates that all three chains had been hammered by the
inexorable shift to consumers buying their products online and
cut-throat competition from the big supermarkets and the online
giant Amazon.

The Independent notes that Entertainment Retailers Association
said the explosion in digital downloading compounded HMV's
problems, UK consumers spent more than GBP1 billion on downloaded
films, music and games in 2012.

The Independent relays that following torrid trading before
Christmas, HMV reportedly pleaded with its suppliers, including
the world's biggest music labels, games makers and film studios,
for GBP300 million of additional funding to pay off its debt
mountain, as part of a radical restructuring its business.  But
this lifeline was rejected, The Independent relates.

The Independent says that HMV launched a clearance sale in its
stores, but denied this was anything other than standard
procedure to clear stock.

If a potential white knight emerges to acquire HMV and keep it on
the high street, it is likely that more than half of the
retailer's 200-plus stores will eventually close, The Independent
notes.

The restructuring specialist Hilco could be interested in
acquiring HMV UK out of administration and keeping a slimmed-down
version operating, The Independent discloses.

The Independent relays that it is also possible that Apollo, the
US private equity firm, may now take another look HMV after the
administration.

In a statement, the report notes that HMV suspended trading in
its shares but said the administrators would continue to trade
the stores while they seek a purchaser for the business.

HMV had been in crisis talks with its eight-strong-banking
syndicate, including Royal Bank of Scotland, Lloyds, ING,
Santander and Sweden's Handelsbanken, for weeks, the report says.

Deloitte's Neville Kahn, who handled the administration of
Woolworths in 2008, is set to be the administrator appointed to
HMV, the report adds.


ROSSETT HALL: Bought Out of Administration by Convivial Hotels
--------------------------------------------------------------
Janet Harmer at Caterer and Hotelkeeper reports that Convivial
Hotels has bought two hotels in Wales and Nottinghamshire out of
administration.

The 50-bedroom Rossett Hall hotel in Rossett, near Wrexham, North
Wales, and the 45-bedroom Charnwood hotel in Blyth,
Nottinghamshire, will now undergo a substantial investment and
refurbishment of their public areas, conference and wedding
facilities, with support from Santander Bank, Caterer and
Hotelkeeper discloses.

According to Caterer and Hotelkeeper, the new Bolton-based
company has been set up by chartered surveyor Jeremy Jones, who
also owns Convivial Management Solutions (CMS), which operates
around 45 licensed premises, including pubs, clubs and
restaurants.

Two experienced managers have been appointed to develop the
hotels' conference and booming wedding business, Caterer and
Hotelkeeper relates.

"We have experience in operating hotels in administration on
behalf of insolvency practitioners and the banks for several
years," Caterer and Hotelkeeper quotes Mr. Jones, group managing
director of Convivial, as saying.


SOCIAL CARE: S&P Assigns Preliminary 'B' Corporate Credit Rating
----------------------------------------------------------------
Standard & Poor's Ratings Services said that it assigned its 'B'
preliminary long-term corporate credit rating to Voyage BidCo
Ltd., the parent company of U.K.-based social care group Voyage
Care Ltd. (Voyage).  The outlook is stable.

At the same time, S&P assigned its 'B+' preliminary issue rating
to the GBP210 million senior secured notes due 2018, to be issued
by Voyage Care BondCo PLC.  The preliminary recovery rating on
the notes is '2', indicating S&P's expectation of substantial
(70%-90%) recovery in the event of a payment default.

In addition, S&P assigned its 'CCC+' preliminary issue rating to
the proposed GBP62 million second-lien notes due 2019, to be
issued by Voyage Care BondCo.  The preliminary recovery rating on
the senior secured notes is '6', indicating its expectation of
negligible (0%-10%) recovery in the event of a payment default.

The final ratings will be subject to the successful closing of
the proposed issuance and will depend on S&P's receipt and
satisfactory review of all final transaction documentation.
Accordingly, the preliminary ratings should not be construed as
evidence of the final ratings.  If the final debt amounts and the
terms of the final documentation depart from the materials S&P
has already reviewed, or if S&P do not receive the final
documentation within what they consider to be a reasonable time
frame, S&P reserves the right to withdraw or revise its ratings.

The rating reflects S&P's view of Voyage's relatively aggressive
capital structure after a leveraged buyout by private equity
group HgCapital in 2006.

S&P assesses Voyage's financial risk profile as "highly
leveraged" under its criteria.  Voyage BidCo is to raise GBP272
million of notes to refinance its bank debt.  Based on the
proposed capital structure after the refinancing, S&P estimates
that Voyage's Standard & Poor's-adjusted net debt-to-EBITDA ratio
will be about 13x by March 31, 2013.

"We consider Voyage's business risk profile to be "fair" under
our criteria.  We base our view on Voyage's relatively small
size, and its exposure to the vagaries of the political climate
in the U.K. Public funds, particularly payments from local
authorities, account for majority of Voyage's revenues.  Both
social care and health care are undergoing significant changes as
the government curbs public expenditure, and we expect the
challenging funding environment to persist in 2013," S&P said.

These negative factors are partially offset by Voyage's position
as the leading provider of care services for adults with learning
disabilities, a segment of the social care market that S&P views
as niche.

In S&P's view, Voyage will sustain broadly positive underlying
revenue growth over the next 12 months.  S&P also assumes that
the company will maintain its operating performance, despite the
potentially negative effect of the U.K. government's public
spending cuts.

Rating stability depends on Voyage generating positive free
operating cash flow (FOCF) of at least GBP10 million without
significantly expanding its borrowing base.  S&P views adjusted
EBITDA interest coverage of about 2x and cash balances of at
least GBP15 million as commensurate with the 'B' rating.

"We could take a negative rating action if adjusted debt to
EBITDA interest coverage drops to less than 1.5x, or if Voyage is
unable to generate positive FOCF.  Such deterioration could arise
from deeper cuts to public funds putting pressure on fees and
volumes; higher capital investments than we estimate; or debt-
financed acquisitions," S&P said.

Rating upside is remote at this stage, in light of Voyage's
relatively small size and high leverage.


VOYAGE BIDCO: Moody's Assigns '(P)B2' CFR; Outlook Stable
---------------------------------------------------------
Moody's Investors Service assigned a provisional (P)B2 corporate
family rating (CFR) to Voyage BidCo Limited and expects to assign
a B2-PD probability of default rating (PDR) to the same entity
upon completion of the group's refinancing. At the same time
Moody's has assigned a provisional (P)B1 instrument rating with
an LGD3 42% to Voyage's announced GBP210 million senior secured
notes and a provisional (P)Caa1 rating with an LGD6 90% to the
GBP62 million second lien notes both issued at the level of
Voyage Care BondCo PLC, a subsidiary of Voyage BidCo Limited. The
outlook on the ratings is stable.

Moody's issues provisional ratings for debt instruments in
advance of the final sale of securities or conclusion of credit
agreements. Upon a conclusive review of the final documentation,
Moody's will endeavor to assign a definitive rating to the
different capital instruments. A definitive rating may differ
from a provisional rating.

Ratings Rationale

Voyage's corporate family rating (CFR) is supported by (i) the
group's position in a niche market as a provider of intensive
care for people with high acuity needs resulting from learning
and/or physical disabilities, (ii) a relatively robust and stable
business model that benefits from long term contracts (68% of
service users stay for more than 5 years) given the non-
discretionary nature of the services provided; (iii) a highly
regulated business environment which creates high barriers to
entry; (iv) Voyage's strong and long lasting relationships with
key customers, e.g. local authorities and NHS; (v) Voyage's
quality leadership with excellent ratings from independent
agencies; as well as (vi) Voyage's solid track record with a 10-
year history of year-on-year revenue and EBITDA growth and
occupancy levels above 90% since 1993. Moreover, the rating takes
into account (vii) Voyage's limited use of operating leases as it
owns the majority of its property which is a distinguishing
factor to some of the group's peers. Therefore, Voyage has a
limited exposure to increasing rent expenses which could burden
the group's profitability.

Voyage's rating is constrained by (i) the relatively small size
of the company that makes it still vulnerable to changes in the
industry, notwithstanding its leading market position in its
niche market; (ii) the currently challenging social care funding
environment leading to pricing pressure; (iii) the high leverage
Moody's anticipates to be approx. 6.1x adjusted Debt/EBITDA as of
FY end March 2013, under the assumption of a 100% equity
treatment of the PEK notes issued by Voyage Mezzco Ltd outside
the restricted group; (iv) with only limited capacity to reduce
debt over the coming years due to limited free cash flow
generation anticipated as well as (v) an adverse mix effect on
profitability resulting from the integration of Solor and a
possible shift towards supported living generating lower profit
margins than the registered care business.

The stable outlook incorporates Moody's expectation that Voyage
will (i) be able to successfully deliver on its business plan and
continuously reduce its high leverage and; (ii) maintain a solid
liquidity profile (after successful refinancing) at all times.
The stable outlook also does not factor in any larger debt-
financed acquisitions, dividends, nor a material increase in
capex beyond GBP10 million per annum.

Voyage's rating could be upgraded if Voyage was able to generate
substantial free cash flow above GBP15 million per annum on a
sustainable basis. Moreover, leverage would have to fall towards
5.5x adjusted debt/ EBITDA.

The rating would come under pressure in a period of sustainably
negative free cash flow generation or if leverage increased above
6.5x adjusted debt/EBITDA.

LIQUIDITY

Following the successful refinancing, the liquidity profile of
Voyage over the next 12 months is solid. In Moody's scenario, the
company has access to total funds of GBP331 million, comprising
of GBP14 million of cash, GBP15 million cash generated from
operations (FFO), GBP272 million from new instruments issued and
GBP30 million available under the undrawn super senior revolving
credit facility. Moody's calculates that Voyage would have cash
needs of GBP286 million over the same period, comprising of
GBP273 million debt repayments, transaction costs and swap
termination costs, GBP7-8 million capex and GBP5 million working
cash for its day-to-day operations.

STRUCTURAL CONSIDERATIONS

The senior secured notes which will be issued by Voyage Care
BondCo PLC are unconditionally guaranteed by the parent, Voyage
BidCo Limited and certain operating subsidiaries. As of 30
September 2012 guarantors represent 98.5% of the group's
consolidated EBITDA before exceptional items and 99.8% of
consolidated gross assets, respectively. The senior secured notes
are secured by the share capital and substantially all assets of
the issuer and the guarantors except for the share capital of
Voyage BidCo Limited. Moody's understands that the assets
securing the senior secured notes include Voyage's freehold
property which has been valued at GBP372 million as of December
2012 by Christie + Co, a third party service provider. The senior
secured notes rank pari passu with the super senior revolving
credit facility but receive proceeds from the collateral only
after the obligations under the super senior revolving credit
facility and certain hedging obligations have been repaid in
full.

The second lien notes which will be issued by Voyage Care BondCo
PLC benefit from the same guarantor coverage and security package
as the senior secured notes but on a subordinated basis. Second
lien note holders receive proceeds from the collateral only after
the obligations under the super senior revolving credit facility,
certain hedging obligations and senior secured notes have been
repaid in full.

In Moody's analysis of the priority of claims within the
suggested capital structure the super senior revolving credit
facility (approx. GBP30 million) ranks ahead of all other
obligations as the banks have a first priority claim on the
enforcement proceeds from the collateral. The senior secured
notes (approx. GBP210 million) as well as trade payables rank
behind the super senior credit facility but before the second
lien notes (approx. GBP62 million). Lease rejection claims rank
behind the second lien notes at the bottom of the debt waterfall.
As a result of Moody's Loss given Default analysis the senior
secured notes are rated one notch above the corporate family
rating. The second lien notes are rated two notches below the
corporate family rating given their claims contractually ranking
behind the senior secured notes and super senior credit facility
in a default scenario.

The principal methodology used in these ratings were the Global
Healthcare Service Providers Industry Methodology published in
December 2011 and Probability of Default Ratings and Loss Given
Default Assessments published in June 2009. Other methodologies
used include Loss Given Default for Speculative-Grade Non-
Financial Companies in the U.S., Canada and EMEA published in
June 2009.

Headquartered in Lichfield (United Kingdom) Voyage is a market
leading national provider of a diverse range of care solutions
for people with complex needs, such as learning disabilities,
physical disabilities and acquired brain injuries. Based in 348
separate residential services and 12 day care centers Voyage
provides both registered accommodation and supported living for
high acuity service users. Voyage is private-equity owned by
HgCapital which acquired the company in April 2006. In FY2011/12
Voyage generated revenues of GBP142.2 million and an EBITDA of
GBP35.1 million.


VOYAGE HOLDING: Fitch Assigns 'B' IDR; Outlook Negative
-------------------------------------------------------
Fitch Ratings has assigned Voyage Holding Limited a Long-term
Issuer Default Rating (IDR) of 'B'.  The Outlook is Negative.

The Negative Outlook reflects the significant refinancing risk
within 18 months, as 100% of Voyage's current debt matures in
April 2014. Should refinancing go ahead with the structure
outlined to us, which comprises an issue of GBP210 million senior
secured notes, GBP62 million junior notes and a GBP30 million
revolving credit facility, the Outlook will likely be revised to
Stable.

Fitch has also assigned an expected rating of 'BB(EXP)'/'RR1' to
the company's GBP210 million senior secured notes and a
'CCC+(EXP)' to the GBP62 million second lien. The 'BB(EXP)'
rating for the senior secured notes reflects the significant
asset base through Voyage's ownership (freehold and long
leasehold) of 76% of properties by number of beds. These were
valued in November 2012 at GBP372m by an independent party. In
its recovery analysis, Fitch adopted the liquidation value of the
company, primarily consisting of its freehold and long-leasehold
properties, as the resultant enterprise value is higher than the
going concern enterprise value. Fitch believes that a 30%
discount on the current market value of the assets is deemed fair
in a distress case.

Key Drivers
Solid Market Positioning In Small Market:
With sales of GBP142 million for the year ending in March 2012
(FY12) and EBITDA of GBP37 million, Voyage is a small player in
the UK social care market. However, it is the number one market
player in the fragmented UK market offering support for people
with learning disabilities. This market is growing, driven by the
ageing population and the improvement in diagnostics. Through its
focus on the higher end of the acuity spectrum, the company is
somewhat protected from substitution and from substantial funding
cuts from local authorities.

Geographical and Business Diversification:
Voyage has solid geographical diversification in the UK with no
single local authority purchaser accounting for more than 3.8% of
revenues for the year ended March 31m 2012. In addition to its
core registered care homes division (approximately 82% of Unit
EBITDA-EBITDA before overhead expenses - for the 12 months ended
September FY12), Voyage covers the full spectrum of social care
services for people with learning disabilities, including
supported living settings as well as "outreach" and day care
activities. This business diversification provides a hedge
against government policy changes.

High Dependence on Local Authority Funding:
The ratings are constrained by Voyage's high dependence on local
authorities funding (approximately 83% of FY12 total revenues).
In the context of the current reduction in UK local authorities'
budgets, the average level of fees funded by local authorities is
expected to remain under pressure in the coming years.

Relatively Weak Credit Metrics:
The rating is also constrained by Voyage's relatively weak credit
metrics. Based on its conservative projections, Fitch expects
post refinancing lease-adjusted funds from operations (FFO) net
leverage of 6.1x at end March 2013, reducing towards 5.6x at end
March 2015 and FFO fixed charge cover remaining around 1.6x over
the same period. Free cash flow (FCF) is also expected to be
relatively low compared with higher rated healthcare peers, at an
expected GBP11m p.a., significantly affected by the interest
payments.

Fitch has not classified as debt the GBP261 million (at end of
March 2012) shareholder loan issued at Voyage Mezzco Ltd. and has
therefore excluded it from leverage and coverage ratios. The
proposed features of this instrument match Fitch's perception of
an-equity like instrument.

Modest FCF Generation:

Voyage operates in a fragmented and growing industry and its
modest FCF generation offers limited headroom to fund any
development capex or acquisitions with internally generated cash
flow. This risk is mitigated by the company's ability to access
equity funding for acquisitions from its shareholders,
restrictions to debt-funded acquisitions that the documentation
of the new capital structure are likely to impose and
management's intention to focus primarily on organic growth.

RATING SENSITIVITY GUIDANCE:
Positive: Future developments that could lead to positive rating
actions include:

- Sustained annual FCF generation of GBP20m or more
- FFO adjusted net leverage of 5x or below
- FFO adjusted leverage below 6x with FFO fixed charge coverage
   above 2.5x

Negative: Future developments that could lead to negative rating
action include:

- FFO adjusted net leverage above 6.5x
- FFO adjusted leverage above 7x, with FFO fixed charge coverage
   below 1.2x on a permanent basis and FCF margin below 3%

Fitch may have provided another permissible service to the rated
entity or its related third parties. Details of this service can
be found on Fitch's website in the EU regulatory affairs page.


* Fitch Says Return on Assets, Not RPI, Are Killing UK Pensions
---------------------------------------------------------------
Weak long-term return on assets is the key fundamental problem
for companies with defined-benefit pension schemes, Fitch Ratings
says. Changes to the way RPI is calculated could have reduced
future pension payouts, and therefore liabilities, but returns
from existing assets are a bigger determinant of the additional
funding companies need to provide, the agency relates.

Fitch says: "The low-growth environment and ultra-loose monetary
policy mean almost all assets offer very low returns, with the
some of the safest -- UK gilts and highly rated corporate bonds
-- now with sub-inflationary coupons. This is a long way from the
steadily rising asset base companies would have expected.
Companies will have to make up the difference.

"This would matter little if low returns were short term,
followed by a rapid correction. But prospects for such a recovery
seem limited.

"The potential for a swift recovery in assets is also diminished
by pressure from regulators and indirectly from mark-to-market-
based accounting for schemes to invest in safer assets --
principally bonds -- rather than equities. Switching to bonds
after a stock market crash in 2008 has effectively locked in
losses for many companies, and unlike equities bonds are likely
to lose value as the economy recovers and interest rates rise.
While open to debate, there is typically a correlation between
risk and return in asset allocation, and a focus on safety is
likely to reduce returns in the long run. Again, companies will
be left to fill any gap.

"In the short term, low returns are manifesting themselves in
pension valuations. Under IAS 19 (accounting) valuations, for
example, liabilities are discounted using 'AA' bond yields, which
are at historical lows. Other deficit measures, including those
used to determine regulatory funding, are affected in similar
ways, albeit less directly. This has led to rising deficits, and
pressure on companies to close their funding gaps.

"Some UK schemes have benefited by switching the inflation
measure used to calculate benefits to CPI from RPI. But their
ability to do this depends on specific scheme rules - and many
are still tied to the typically higher RPI measure. RPI has been
criticized for methodological reasons and changes would probably
have caused reported RPI inflation, and expected increases in
pensions, to be lower.

"The increasing costs of funding means most schemes are now
closed to new entrants, and in many cases current members have
been shifted to defined contribution. UK companies are therefore
increasingly funding legacy liabilities for no ongoing benefit.
We focus on the ongoing cash cost of pensions rather than
treating them as debt-like. This cost is determined by the
relative growth of liabilities and assets, and regulatory funding
requirements.

"The UK's Pensions Regulator has been pragmatic in its approach
to funding, recognizing that many companies do not have the
resources to clear deficits rapidly. Nonetheless many have had to
significantly increase the payments they make into schemes.

"For the vast majority of rated UK companies these problems are
manageable. A combination of scheme closures, novel approaches to
scheme funding, and healthy performance by many, means that
pensions are not a game changer."


* Fitch Says Downgrades to Outnumber Upgrades Among EMEA Cos.
-------------------------------------------------------------
EMEA corporates' cautious financial strategies are of less and
less help in avoiding downgrades, Fitch Ratings says. Downgrades
are likely to outnumber upgrades among Fitch-rated EMEA
corporates in 2013.

Fitch says: "The trailing three-month aggregate of revisions to
Outlooks and Rating Watches, which has been a fairly good
predictor of future rating changes, dropped towards the end of
2012. This suggests that rating actions will remain net negative
in 2013. What's more, the trend has been towards rating actions
driven by weaker fundamental performance, rather than more
aggressive financial policies, M&A activity or capex.

"This limits event risk -- financial policy has been a much
bigger downgrade driver in the US, for example -- but gives
issuers less flexibility to avoid rating action, as 2012's
downgrade numbers (double those for 2011) illustrated.

"Utilities and telecom companies accounted for 61% of downgrades
in 2012 and our outlook for both sectors remains negative this
year. For utilities this is due to weak fundamentals and
regulatory pressure across most of the EU. Telecoms face a
difficult mix of weaker consumer confidence and strong
competitive pressure across the continent.

"Other sectors with a negative rating outlook include European
food retailers, where the region's biggest operators face the
biggest challenge to their business models from changing
consumption patterns. Steel producers in western Europe also have
a negative outlook due to low demand from the key construction
and automotive markets."



===============
X X X X X X X X
===============


* CEE 2013 Fiscal Financing Needs Lower Than Eurozone, Fitch Says
-----------------------------------------------------------------
Fitch Ratings says in a newly-published report that the larger
Central and Eastern European (CEE-4) countries will need to
borrow EUR86 billion (US$112 billion) in 2013 to finance fiscal
deficits and roll over existing debt. This equates to about 10%
of GDP, down from 12% in 2012, and compares favorably with a
eurozone average of almost 15% of GDP in 2013.

All CEE-4 countries bar the Czech Republic (which was affected by
a large one-off factor) are estimated to have run lower general
government budget deficits in 2012 than in 2011. This reflects a
strong commitment to fiscal consolidation, even in the face of
poor prospects for economic growth. In 2013 Fitch expects CEE-4
to run low budget deficits, partly in the context of enhanced
fiscal surveillance at the EU level.

CEE-4 fiscal fundamentals stand in marked contrast to the
eurozone, where deficits, debt and fiscal financing needs are
significantly higher. Better fiscal fundamentals and ample
international liquidity suggest CEE-4 should have little
difficulty funding 2013 gross borrowing requirements (GBRs),
barring any major surprises. However, the eurozone outlook
dominates and there are significant uncertainties in relation to
growth which in turn pose upside risks to CEE-4 budget deficits
in 2013.

Providing some relief to CEE-4 countries is a relatively light
external (FX) bond redemption schedule. Poland and Czech Republic
have carried out significant pre-financing of their 2013 GBRs.
Hungary and Romania will be looking to refinance redemptions to
official creditors in the market. Hungary successfully refinanced
in the domestic market in 2012, but Fitch expects it to go to the
international capital market in 2013.

Hungary and Romania owe large sums to the IMF from 2013, as the
loans received during the 2008-09 global financial crisis come
due. Romania's relations with the Fund are good, and it is likely
to obtain a new precautionary IMF deal when the current one
expires in March 2013. Hungary's relations with the IMF are poor
and Fitch considers a new deal unlikely, barring limited external
market access. The renewal of Poland's Flexible Credit Line,
worth around US$30 billion and due to expire in early 2013, would
represent an important backstop in the event of market
turbulence.

Fitch maintains Stable Outlooks on the CEE-4. Market perceptions
of CEE-4 sovereign risk, as captured by CDS-implied ratings
calculated by Fitch Solutions, improved over 2012, outperforming
eurozone peripherals in some cases, and all CEE-4 enjoyed
significant yield compression. Major central banks' liquidity
operations clearly played a key role in easing risk aversion, but
so did resolute commitment to fiscal consolidation. Combined with
Fitch's assessment of GBRs, this would suggest, all other things
being equal, that CEE-4 sovereign ratings are unlikely to change
in 2013.

The report is entitled "2013 CEE Governments' Financing Needs".


                            *********

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., Washington, D.C., 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 2013.  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$775 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 215-945-7000 or Nina Novak at
202-241-8200.


                 * * * End of Transmission * * *