TCREUR_Public/130426.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

            Friday, April 26, 2013, Vol. 14, No. 82



* AUSTRIA: Insurance Stagnating in Domestic Market, Fitch Says
BADEL 1862: Set to Enter Into Pre-Bankruptcy Settlement Procedure

C Z E C H   R E P U B L I C

RPG BYTY: Fitch Assigns 'BB-' Rating to EUR400MM Senior Notes


WENDEL: S&P Lifts Corp. Credit Rating to 'BB+'; Outlook Stable


COMMERZBANK AG: Fitch Affirms 'BB+ Subordinated Debt Rating
FRANZ HANIEL: S&P Affirms 'BB/B' Corp. Ratings; Outlook Positive


FREESEAS INC: Incurs US$30.8 Million Net Loss in 2012


HAYES HOTEL: Put Under Receivership Over AIB Debt
WATERFORD CRYSTAL: ECJ Rules in Favor of Workers in Pension Suit


HOME CREDIT: Fitch Assigns 'BB-' Long-Term Issuer Default Rating


CID FINANCE: Fitch Maintains Watch Negative on 'BB-sf' Rating


NORILSK NICKEL: Fitch Affirms 'BB+' Long-Term IDR; Outlook Pos.
* LIPETSK REGION: Fitch Assigns 'BB' Rating to RUB3-Bil. Bond
* RUSSIA: Moody's Notes Stability of RMBS Market in 2013


* SLOVENIA: Banks Need EUR900MM of Capital Injection by End-July


BANKIA SA: To Rule on Event of Default Under Credit Default Swaps
BANKIA SA: Returns to Profitability Following Record Loss
TDA IBERCAJA 2: Moody's Downgrades Rating on Class E Notes to Ca
* SPAIN: Bad Bank Asset Transfer Offset By Cedulas Cancellations
* SPAIN: Moody's Expounds on Rating in New Credit Report


TURKIYE SISE: Moody's Assigns Ba1 Corporate Family Rating
TURKIYE SISE: S&P Assigns 'BB+' Corp. Rating; Outlook Stable

U N I T E D   K I N G D O M

HERCULES PLC: S&P Downgrades Rating on Class D Notes to 'B-'
HIBU PLC: Plans Debt Restructuring
PENDRAGON PLC: Moody's Assigns 'B2 Corp. Rating; Outlook Stable

* UK: Unveils Proposal to Help Struggling Pub Tenants
* UK: Number of Scottish Business Failures Down 63% in Q12013
* UK: Fitch Says Pub Proposal May Pressure Profits


* BOOK REVIEW: The Luckiest Guy in the World



* AUSTRIA: Insurance Stagnating in Domestic Market, Fitch Says
Fitch Ratings says in a new report that prospects for Austrian
insurers are challenged by a stagnating domestic market but
benefit from their strong positions in insurance markets in
Central Eastern and South-Eastern Europe (CESEE).

Austrian insurers' gross written premiums (GWP) fell by 1.2%
overall in 2012, after a decrease of 1.7% in 2011. The overall
decline in GWP reflected weak life insurance results, which fell
by 6.8% in 2011 and by 6.7% in 2012; in contrast, non-life
business grew, but not by enough to fully offset the decline in
life insurance.

"Life insurance gross written premiums for both years were hit by
changes in tax treatment," says Stephan Kalb, Senior Director in
Fitch's insurance team. "Results for 2011 were affected by the
extension of the minimum contract duration for tax-privileged
status. Results for 2012 were affected by subsidies for one of
the popular pension products being cut by the state."

Austrian insurers are closely linked to insurance markets in
CESEE, where more than one-third of their premium income
originates. The region offers strong growth opportunities. With
CESEE growth rates expected to exceed growth in Austria, Fitch
expects the region to become even more important to Austrian
insurers. However, although CESEE insurance business is generally
profitable, it adds volatility to Austrian insurers' balance
sheets and earnings because CESEE countries show a relatively
high sensitivity to global economic downturns.

Issues connected with low interest rates remain one of the
biggest challenges for the sector, but investments recovered
during 2012, as the level of write-downs fell considerably
compared with 2011. As underwriting results also improved for all
three business lines, life, health, and property/casualty, the
sector's overall profitability in 2012 was considerably better
than in 2011.

Fitch expects Austrian GWP to stabilize in 2013, as life
insurance is likely to recover from the dip in sales. Austrian
insurers face stiff competition, but underwriting results in non-
life lines are expected to make up for low investment yields and
the low profitability in life insurance. Most of the larger
players in the market should once again benefit from increased
growth in the CESEE region in 2013, but earnings from this region
are set to remain volatile.

The report is entitled 'Austrian Insurance: Stagnating, but
Opportunities East.'

BADEL 1862: Set to Enter Into Pre-Bankruptcy Settlement Procedure
SeeNews reports that Badel 1862, currently undergoing a
privatization procedure, said on Wednesday a decision has been
taken by the relevant body for the launch of a pre-bankruptcy
settlement procedure for the company.

According to SeeNews, Badel 1862 said in a filing to the Zagreb
bourse that the company's creditors have been invited for the
conclusion of a pre-bankruptcy settlement with the company.

The company posted a non-consolidated net loss of HRK36.6 million
(US$6.3 million/EUR4.8 million) in 2012, SeeNews relates.

In January, Badel 1862 said the bidders that have placed offers
for the 65.84% state-owned stake in the company had started due
diligence, SeeNews relates.

In November, the Croatian government said that all 11 bidders
that placed offers in the first phase of the sale procedure for
the stake will be invited to file binding bids, SeeNews recounts.

Badel 1862 is a Croatian wine and spirits producer.

C Z E C H   R E P U B L I C

RPG BYTY: Fitch Assigns 'BB-' Rating to EUR400MM Senior Notes
Fitch Ratings has assigned RPG Byty s.r.o's (RPG) EUR400m 2020
senior secured note a final rating of 'BB-'/RR3 .

RPG's ratings are supported by stable rental income received from
its Czech residential housing portfolio, de-regulation of rents
that are scheduled to increase rental income above inflation in
the medium term and limited future capex requirements following a
large capex plan. However, ratings reflect the high geographical
concentration risk and the expected re-leveraging of the business
following the proposed secured bond the proceeds of which will go
to shareholder distributions and prepayment of existing bank debt
maturing in 2016. Fitch expects proforma leverage to stabilize at
around 40% of loan-to-value (LTV) and interest cover around 2.0x
in 2013 and 2014.

The senior secured notes benefit from a security package
including a first rank mortgage on the real estate portfolio
offering around 2.0x asset cover and a pledge on issuer shares
leading Fitch to assign a final 'BB-'/RR3. The final instrument
rating is based on the now received final documentation.


Strong Concentration Risk:
The 44,000 unit portfolio is located in the Moravia-Silesia
region with all properties situated within a 50km radius. Rental
income and portfolio valuations are strongly linked to the local
economy. Although local demographics are not entirely positive,
Moravia's recent economic performance has been solid with an
average annual growth rate of 5.6% during 2003 to 2011, above the
EU average of 1.9% during the same period. Positively, the region
has attracted new sectors of activity, such as electronics,
software companies and pharmaceutical groups; however, a strong
focus is still on the cyclical industrial sector.

In both Ostrava and Havirov, RPG's portfolio represents over 10%
and 30% of the town's housing stock respectively. In addition
four blocks of apartments (in Ostrava, Havirov and Karvina)
account for 52% of the entire portfolio by value at December 2012
(FY12). However, the portfolio is sizeable and RPG benefits from
economies of scale in terms of letting and asset management.

Reasonable Leverage Metrics:
Fitch forecasts loan-to-value (LTV) pro-forma leverage (post-
secured bond issue) at around 40% for FY13 and FY14 compared to
21% at FY12. RPG does not undertake any residential development
and hence execution and budget risk on capex is low. Since 2006
EUR250m has been spent on upgrading the portfolio and Fitch
expects a low run-rate of maintenance capex.

Stable Rental Income:
RPG's business strategy is based on delivering increased rents as
contractually agreed with its tenants and tightly managing
operating costs. Rental income has grown as a result of the Czech
rental market de-regulation in 2010. The average tenure for
residents is long at 14.8 years, reflecting a high average age
group at 54 years old. Around 22% of the tenants are retired
indicating positive tenant retention rates.

Challenging Vacancy Rate Outlook:
Following rental increases resulting from de-regulation, the
vacancy increased from a low 3% to around 11% at FY12, as tenants
left what had been heavily subsidized accommodation (around 60%-
65% below markets rents in 2009).

Shareholder Friendly Dividend Policy:
2012 and forecast 2013 shareholder distributions are likely to
total around CZK8.5 billion (EUR337 million) with around CZK3.9
billion (EUR154 million) paid from the prospective CZK10 billion
(EUR400m) bond issue. The majority of the remaining proceeds will
be used to prepay the existing CZK4.5 billion (EUR175 million)
syndicated term loan facility maturing 2017. This debt reflects
historic dividend payouts and a EUR250 million capex investment
since 2006.


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

- Improved portfolio diversification where RPG establish a
  critical size of residential portfolio outside the Ostrava

- A sustainable improvement in financial metrics with LTV
  below 40%, net debt/ EBITDA below 5.0x and EBITDA net
  interest cover (NIC) ratio above 2.0x

- Increased liquidity on a sustained basis to a score of
  1.0x resulting from undrawn committed debt facilities or
  increased unrestricted cash.

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

- Any significant deterioration in vacancy rates or rise in
  tenant arrears.
- EBITDA NIC falling below 1.5x (pro-forma FY13 1.8x)

- Deteriorating valuation leading to weaker leverage metrics
  (LTV above 55%) that make re-financing prospects for this
  bullet bond more difficult.


WENDEL: S&P Lifts Corp. Credit Rating to 'BB+'; Outlook Stable
Standard & Poor's Ratings Services said it has raised its long-
term corporate credit rating on France-based holding company
Wendel to 'BB+' from 'BB.'  At the same time, the short-term
credit rating was affirmed at 'B'.  The outlook is stable.

S&P also raised its issue ratings on Wendel's EUR3.0 billion
senior unsecured notes and EUR1.2 billion unsecured revolving
credit facility (RCF), to be replaced by a new EUR0.4 billion
RCF, to 'BB+' from 'BB'.  The recovery rating on these
instruments remains unchanged at '3,' indicating S&P's
expectation of meaningful (50 percent-70 percent) recovery in the
event of a payment default.

The upgrade reflects the drop in Standard & Poor's loan-to-value
(LTV) ratio for Wendel to less than 40 percent, a level
commensurate with S&P's assessment of the company's financial
risk profile as "significant" and the 'BB+' rating.  S&P also
take into account its opinion of management's strong commitment
to maintain the LTV ratio below 40 percent.

On April 16, 2013, and assuming unchanged unlisted asset values
compared with the last available figures in March 2013, three
listed assets represented close to 85 percent of Wendel's
portfolio value of EUR9.5 billion.  The assets are building
materials producer and distributor Compagnie de Saint-Gobain
(28 percent of total assets), in which Wendel holds a 17 percent
interest; testing, inspection and certification company Bureau
Veritas S.A. (54 percent), of which it owns 51 percent, and low-
voltage electrical fittings manufacturer Legrand S.A. (5
percent), in which it owns 5 percent.  Large majority stakes in
much smaller and more indebted unlisted corporate entities round
out the company's portfolio.

On April 16, 2013, Wendel's LTV ratio stood at about 37 percent.
Assuming no cash reinvested in the asset portfolio, it would have
taken an 8 percent decline in asset values to reach the 40
percent LTV guidance S&P deems commensurate with a "significant"
business risk profile.  While S&P acknowledges Wendel has limited
flexibility versus its expectations for the current 'BB+' rating,
S&P understands management is strongly committed and has the
incentive to do what it takes to keep strengthening the capital
structure in the long term, meaning if necessary to contain LTV
to within S&P's expectations for the ratings in the event of
rising equity market turbulence.

The ratings on Wendel reflects S&P's assessments of the company's
financial risk profile as "significant," revised up from
"aggressive," and its business risk profile as "satisfactory," as
S&P's criteria define the terms.

S&P believes that the main rating constraint remains Wendel's
noninvestment-grade financial profile.  A portion of the shares
held in Saint-Gobain, Legrand, and Bureau Veritas are still
pledged to secure EUR0.6 billion of Saint-Gobain-related bank
debt.  They are currently worth more than EUR0.6 billion
according to S&P's calculations.  In addition, S&P notes that
cash burn remains significant at holding-company level, with
total coverage of fixed charges by dividends of only about 0.6x
in 2012.

Partially offsetting these weaknesses is the generally good
creditworthiness of Wendel's larger portfolio companies, and
their listed, potentially liquid nature.  Management's ability to
rotate assets, extracting value out of its investments to reduce
leverage is also a critical positive.

The stable outlook reflects S&P's expectation that Wendel should
be able to maintain an LTV ratio at about 40 percent, and
adequate liquidity, based on its current portfolio composition,
financial policy and asset flexibility.

A financial policy more aggressive than S&P currently factors
into the rating, which it do not envisage at this stage, or
significant deterioration in the share prices of Wendel's key
listed investments--without an appropriate response from
management to reduce net debt--could lead S&P to consider a
negative rating action.

"We could consider a positive rating action, assuming broadly
unchanged portfolio liquidity, quality, and diversity, if we saw
that the company had established for its LTV a sustainable track
record of headroom versus the 35 percent we deem commensurate
with an investment-grade rating and appeared to us able and keen
to maintain it.  Another prerequisite would also be a further
reduction in cash burn at holding company level, with dividends
received covering at least net interest expense.  We would also
examine the operating performance of Wendel's main subsidiaries
and would expect acquisitions to be pre-financed by disposals to
a large extent," S&P said.


COMMERZBANK AG: Fitch Affirms 'BB+ Subordinated Debt Rating
Fitch Ratings has affirmed UniCredit Bank AG (HVB) and
Commerzbank AG's (CBK) Long-term Issuer Default Ratings (IDRs) at
'A+'. The Outlooks are Stable. The agency has also affirmed the
banks' Viability Ratings (VR), Support Ratings (SR), Support
Rating Floors (SRF) and senior debt ratings and upgraded some of
CBK's hybrid instruments.


CBK and HVB's Long-term and Short-term IDRs, Support Ratings,
Support Rating Floors and senior debt ratings reflect Fitch's
continued view that their status as large universal banks in
Germany results in extremely high (indicated by a SRF of 'A+')
probability of state support. Fitch understands that after the
capital increase announced by CBK on 15 March 2013, the German
government will keep its ownership through the Financial Market
Stabilisation Fund (SoFFin) below 20%.

HVB is fully owned by UniCredit S.p.A. ('BBB+'/'F2') which is
rated three notches below HVB following Fitch's downgrade of
Italy on 8 March 2013. However, given its ownership structure,
Fitch believes HVB would first look to its 100% owner, UniCredit
S.p.A. for support, if needed. Nonetheless, Fitch expects that
the German government would ultimately support HVB if the
UniCredit S.p.A's resources were insufficient.

The foreign ownership of HVB does not constrain Fitch's view of
local sovereign support as it has a domestic franchise, is
managed relatively independently and funds itself independently
from its parent.

The Stable Outlooks continue to benefit from Fitch's unchanged
view on support. Fitch expects that the German government will
continue to support large German banks, including CBK and HVB, as
long as the financial system in Europe remains fragile and the
tools for dealing with a large international bank failing are not
fully developed.


Fitch's view on support is sensitive to developments within the
regulatory and legal framework, particularly emanating from the
European Commission with regard to bail-ins and centralized
regulatory oversight and to the changing attitude of the German
authorities towards using bank resolution tools.

Fitch understands that there is broad political will in Germany,
supported by all major parties, to move towards reducing the
implicit state support of systemically important banks in the
country at some point. The European Commission's 6 June 2012
paper proposing to avoid future bank bail outs represented
another important step in a series of policy and regulatory
initiatives to curb systemic risks posed by the banking industry.
This followed Germany's implementation of a Restructuring Act in
2011. These developments highlight the potential risks for CBK's
and HVB's Support Ratings, SRFs, IDRs and senior debt ratings.

If Fitch changes its view on support in the future, the current
VRs provide a broad indicator of where the IDRs could end up for
CBK and HVB.


The affirmation of Commerzbank's VR reflects its sound liquidity
position and more solid capitalization, as well as progress made
with its extensive restructuring plans, including a reduction in
non-core assets and declining administrative expenses. Although
Commerzbank is now better positioned to protect its core
franchise in a competitive domestic market, its restructuring
still has some way to go and parts of its non-core assets (NCA)
still potentially pose material downside risks. Commerzbank's
performance has been helped by the favorable German economy and
notably the very low number of corporate insolvencies in Germany.
However, Commerzbank is still exposed to concentration risks and
troubled European markets, which absorbed a substantial share of
its profits in recent years, while earnings from its private
customer business are weak.

Fitch expects that Commerzbank would be able to absorb a
potential deterioration of the asset quality in its core
businesses, but the downside risks on certain non-core commercial
real estate, shipping and southern European public sector assets
is still potentially material.

Fitch notes that a reduction of non-core assets, specifically of
its exposure in ship finance and certain exposures or risks in
southern Europe could result in upside potential for
Commerzbank's VR. Similarly, improved profitability in CBK's
private customer business could also lead to an upgrade of CBK's
VR, assuming no further deterioration at its non-core assets.

At the same time, a further weakening of CBK's core businesses in
the short to medium term, most likely in the form of falling
revenues coupled with higher loan impairment charges which are
currently relatively low, could put pressure on CBK's VR.


HVB's VR reflects the bank's standalone credit strength, which
benefits from its well-established domestic corporate and
investment banking (CIB) franchise and especially from its strong
capitalization (Fitch core capital ratio at end-2012: 19.4%;
falling to a still healthy 17.2% after the deduction of the
consolidated profit expected to be transferred to its parent),
which compensates for the intrinsic earnings volatility of these
activities. HVB's solid capitalization is the key rating strength
and Fitch expects the bank's capital position to remain strong
under forthcoming regulatory changes and the forecast business

Fitch views HVB's announcement on March 18, 2013 that it will pay
out a special dividend through the release of reserves as neutral
for its VR at such high capitalization levels. However, HVB's VR
is potentially sensitive to further weakening in core capital
ratios for similar or other reasons, to sustained material cross
border transfers of liquidity or to a weakening of its core and
sound corporate banking franchise. In addition, being part of the
UniCredit group might pose potential contagion risk for HVB's
funding franchise from negative developments in the European
sovereign crisis, which cannot be fully excluded.

Reflecting the German focus of its exposures, HVB's asset quality
continued to benefit from the resilient German economy. Fitch
expects this stable trend to continue in the coming quarters, but
given the fragile economic situation, this trend could quickly
reverse. In this context, some risk pockets remain, including
risks from high concentrations in the bank's leveraged buyout
exposure, project finance business and ship lending. Non-
strategic assets are being worked out and the bank continues to
reduce its exposure to riskier asset classes.

Under Fitch's rating criteria, the VR of a subsidiary will not
normally be more than three notches above a parent bank's IDR. As
a result, further downgrades of the parent, potentially driven by
further downgrades of Italy, could result in a downgrade of HVB's


Fitch has upgraded certain legacy Tier 1 and upper Tier 2
securities after CBK reported positive results under German GAAP
for 2012. We expect write-ups of previous principal write downs
and cumulative coupon payments in 2013 for UT2 Funding plc and
write up and coupon payments on HT1 Funding Capital. We also
expect Commerzbank Capital Funding Trust I and II to resume
coupon payments.

UT2 Funding plc securities are upper Tier 2 instruments and
notching for loss severity (one notch) is lower than for the
bank's Tier 1 securities (two notches). However, they have higher
non-performance risk (three notches) compared with Tier 1 debt
(two notches) because coupon payments are dependent on profits in
the profit and loss account.

The Tier 1 securities, including HT1 Funding Capital, that have a
distributable profit trigger or a regulatory capital ratio
trigger are rated four notches below CBK's VRs, two notches each
for high loss severity and high non-performance risks.

Lower Tier 2 securities issued by CBK are rated one notch below
CBK's VR in order to reflect higher loss severity compared to
senior unsecured debt instruments (one notch), in line with
Fitch's "Assessing and Rating Bank Subordinated and Hybrid
Securities" criteria. The subordinated debt issued by Dresdner
Funding Trust IV has been upgraded to 'BB+' to reflect minimal
incremental non-performance risk characteristics relative to
CBK's VR (zero notches) plus one notch for loss severity for this
CRD IV compliant subordinated debt.

Subordinated debt and other hybrid capital issued by CBK and
associated SPVs are primarily sensitive to any change in CBK's

The ratings of HVB's hybrid capital instruments (issued through
Funding Trusts I and II) reflect the financial standing of HVB,
as reflected in its VR. They are notched down four notches from
HVB's VR, reflecting two notches for loss severity and two
notches for incremental non-performance risk relative to the
bank's VR. While Fitch acknowledges that the German regulator
could demand a deferral of coupon payment on these profit-linked
instruments in line with the terms and conditions of the
instruments, the agency does not anticipate such intervention in
light of the bank's solid standalone financial profile.


Commerzbank U.S. Finance Inc and UniCredit US Finance LLC are
wholly owned subsidiaries of CBK and HVB, respectively. The
Short-term ratings of their commercial paper programs are
equalized with CBK's and HVB's Short-term IDRs and reflects the
likelihood of systemic support. The Short-term ratings of the
commercial paper programs are sensitive to the same factors that
might drive a change in CBK or HVB's IDRs.

Hypothekenbank Frankfurt AG's ratings are unaffected by the
rating actions.

The ratings actions are:

Commerzbank AG

Long-term IDR: affirmed at 'A+'; Outlook Stable
Short-term IDR: affirmed at 'F1+'
Viability Rating: affirmed at 'bbb-',
Support Rating: affirmed at '1'
Support Rating Floor: affirmed at 'A+'
Commercial paper and Certificates of Deposits: affirmed at 'F1+'
Senior unsecured debt: affirmed at 'A+'
Market-linked securities: affirmed at 'A+emr'
Subordinated debt (Lower Tier 2): affirmed at 'BB+'
Subordinated debt (Dresdner Funding Trust IV (XS0126779791):
  upgraded to 'BB+' from 'BB-'

Commerzbank U.S. Finance, Inc.'s Short-term rating: affirmed at

Actions on hybrid capital instruments issued by Commerzbank:

Dresdner Funding Trust I's dated silent participation
certificates (XS0097772965): affirmed at 'B+'.

Commerzbank Capital Funding Trust I (DE000A0GPYR7) and II
(XS0248611047): upgraded to 'B+' from 'CCC'

UT2 Funding plc upper Tier 2 securities (DE000A0GVS76): upgraded
to 'B+' from 'CCC'

HT1 Funding GmbH Tier 1 Securities (DE000A0KAAA7): upgraded to
'B+' from 'CCC'

UniCredit Bank AG

Long-term IDR affirmed at 'A+'; Outlook Stable
Short-term IDR affirmed at 'F1+'
Viability Rating affirmed at 'a-'
Support Rating Floor affirmed at 'A+'
Support Rating affirmed at '1'
Market Linked Securities affirmed at 'A+emr'
Senior unsecured Certificates of Deposit affirmed at 'F1+'
Senior unsecured Debt Issuance Programme affirmed at 'A+'
Senior unsecured Debt Issuance Programme affirmed at 'F1+'
Senior unsecured BMTN Programme affirmed at 'A+'
Senior unsecured EMTN Programme affirmed at 'A+'
Senior unsecured EMTN Programme affirmed at 'A+'
Senior unsecured EMTN Programme affirmed at 'F1+'
Senior unsecured notes affirmed at 'A+'
Senior unsecured GTD notes affirmed at 'A+'
Subordinated notes affirmed at 'BBB+'

UniCredit US Finance LLC Commercial Paper Programme affirmed at

HVB Funding Trusts I and II Hybrid Notes affirmed at 'BB+'

FRANZ HANIEL: S&P Affirms 'BB/B' Corp. Ratings; Outlook Positive
Standard & Poor's Ratings Services said that it had revised its
outlook on Germany-based operating holding company Franz Haniel &
Cie GmbH (Haniel) to positive from stable.  At the same time, S&P
affirmed its 'BB/B' long- and short-term corporate credit ratings
on the company.

In addition, S&P affirmed its 'BB' senior unsecured debt ratings
on the company.  The recovery ratings on this debt are unchanged
at '3', indicating S&P's expectation of meaningful (50 percent-
70 percent) recovery in the event of a payment default.

S&P likewise affirmed the 'B+' issue rating on Haniel's
subordinated notes.  The recovery rating on these notes remains
at '5', indicating S&P's expectation of modest (10%-30%) recovery
in its stress scenario.

S&P revised the outlook to positive because it has seen that
Haniel's loan-to-value ratio (LTV) has declined as a consequence
of the decisive measures taken by management to reduce leverage.
Since the announcement of its strategic plan on Nov. 27, 2012,
Haniel has reduced its stakes in its two main assets, pharmacies
manager and health care service provider Celesio AG (to 50.01%
from 54.64%) and food wholesaler and electronics retailer Metro
AG (to 30.01% from 34.24%), and in some smaller assets as well.
Because Haniel has used the proceeds to repay debt, reported net
indebtedness was slightly less than EUR2 billion on March 31,
2013, compared with EUR2.4 billion on Sept. 30, 2012.

S&P estimates the market value of Haniel's investment portfolio
was approximately EUR5.4 billion on April 16, 2013 (assuming
stable unlisted asset values compared with March 31, 2013).  On
the basis of a net debt of around EUR2 billion, S&P calculates
LTV was around 37% on that date (from 43% on Sept. 30, 2012),
which is well below S&P's 45% ceiling for the 'BB' rating.  More
divestments or a rebound in asset prices would establish Haniel's
LTV even more firmly within S&P's expectation for a 'BB+' rating,
that is, sustainably below 40%.

In the context of uncertain macroeconomic prospects for Europe,
to which Haniel's portfolio companies are largely exposed, asset
valuations could remain depressed for some time.  As a
consequence, S&P views Haniel's initiatives as positive for the
ratings, since a permanently reduced net debt is the only lever
management can currently pull to lower LTV on a sustainable

The ratings on Haniel reflect S&P's view of its "satisfactory"
business risk profile and "significant" financial risk profile.

The ratings are primarily constrained by the high exposure of
Haniel's portfolio companies to Europe and some continuing asset
concentration on Metro.  Also weighing on the ratings are the
inherent challenges that Celesio faces in its activity, even
though S&P understands Haniel has taken different initiatives to
divest noncore assets and improve its operating margin.

These weaknesses are mitigated by the overall adequate credit
quality of Haniel's subsidiaries, and the controlling stakes
which provide the company influence over their strategic
decisions.  In addition, Haniel's recently established track
record of asset divestment has improved S&P's assessment of its
portfolio's liquidity.  Management's conservative financial
policy also translates into good liquidity at the parent company
level, underpinned by long-dated debt maturities and a modest
dividend payout to shareholders.

The positive outlook reflects S&P's view that, given its reduced
net debt, Haniel should be in a position to build a track record
of LTV sustainably below (with some headroom) the threshold S&P
believes is commensurate with a 'BB+' long-term rating.

For an upgrade, assuming broadly unchanged portfolio
characteristics, S&P would look for a track record of an LTV
ratio below 40% and signs that Haniel would be able to maintain
this.  To that extent, S&P would expect acquisitions to be mostly
prefinanced with disposals.

Failure to manage the LTV ratio within S&P's rating threshold
could lead initially to a revision of the outlook to stable, or,
though unlikely at this stage, to a negative rating action if
higher financial risk results, which is not commensurate with the
current ratings.


FREESEAS INC: Incurs US$30.8 Million Net Loss in 2012
Freeseas Inc. filed with the U.S. Securities and Exchange
Commission its annual report on Form 20-F disclosing a net loss
of US$30.88 million on US$14.26 million of operating revenues for
the year ended Dec. 31, 2012, as compared with a net loss of
US$88.19 million on US$29.53 million of operating revenues for
the year ended Dec. 31, 2011.  The Company incurred a net loss of
US$21.82 million in 2010.

The Company's balance sheet at Dec. 31, 2012, showed US$114.35
million in total assets, US$106.55 million in total liabilities
and US$7.80 million in total shareholders' equity.

RBSM LLP, in New York, issued a "going concern" qualification on
the consolidated financial statements for the year ended Dec. 31,
2012.  The independent auditors noted that the Company has
incurred recurring operating losses and has a working capital
deficiency.  In addition, the Company has failed to meet
scheduled payment obligations under its loan facilities and has
not complied with certain covenants included in its loan
agreements.  It has also failed to make required payments to
Deutsche Bank Nederland as agreed to in its Sept. 7, 2012,
amended and restated facility agreement and received notices of
default from First Business Bank.  Furthermore, the vast majority
of the Company's assets are considered to be highly illiquid and
if the Company were forced to liquidate, the amount realized by
the Company could be substantially lower that the carrying value
of these assets.  These conditions among others raise substantial
doubt about the Company's ability to continue as a going concern.

A copy of the Form 20-F is available for free at:


                         About FreeSeas Inc.

Headquartered in Athens, Greece, FreeSeas Inc., formerly known as
Adventure Holdings S.A., was incorporated in the Marshall Islands
on April 23, 2004, for the purpose of being the ultimate holding
company of ship-owning companies.  The management of FreeSeas'
vessels is performed by Free Bulkers S.A., a Marshall Islands
company that is controlled by Ion G. Varouxakis, the Company's
Chairman, President and CEO, and one of the Company's principal

The Company's fleet consists of six Handysize vessels and one
Handymax vessel that carry a variety of drybulk commodities,
including iron ore, grain and coal, which are referred to as
"major bulks," as well as bauxite, phosphate, fertilizers, steel
products, cement, sugar and rice, or "minor bulks."  As of Oct.
12, 2012, the aggregate dwt of the Company's operational fleet is
approximately 197,200 dwt and the average age of its fleet is 15


HAYES HOTEL: Put Under Receivership Over AIB Debt
------------------------------------------------- reports that Hayes Hotel has gone into
receivership over debts to state-owned bank AIB.

According to, accountants Kieran Wallace and
Padraic Monaghan of KPMG were appointed as joint receivers over
the 34-bedroom Hayes Hotel in Thurles and the 70-bedroom Creggan
Court Hotel in Athlone, Co Westmeath, on Wednesday.  The hotels
are both owned by Frank and Mary Mulcahy's Mulcahy Enterprises, discloses.  Both hotels will remain open following
the appointment of receivers, notes.

WATERFORD CRYSTAL: ECJ Rules in Favor of Workers in Pension Suit
Genevieve Carbery at The Irish Times reports that the European
Court of Justice has found in favor of former Waterford Crystal
workers in a landmark case taken over losses in their pensions.

According to the Irish Times, the ten workers took the case
against the State to the European Court of Justice in Luxembourg
for its failure to establish a pension protection system and were
seeking compensation.  They claimed that their rights were not
protected by the State in the event of the insolvency of their
employer, the Irish Times relates.

Waterford Crystal was placed in receivership in January 2009 and
the company's pension schemes were wound up two months later with
a deficit of some EUR110 million, the Irish Times recounts.

Given the funding levels in the pension schemes workers were
offered payments representing between 18% and 28% of their
entitlements, the Irish Times discloses.  It was argued that
following a 2007 European court decision, the workers were
entitled to at least 49%, the Irish Times recounts.

In its judgment yesterday the court, as cited by the Irish Times,
said the measures taken by Ireland subsequent to its 2007 ruling
"have not brought about the result that the plaintiffs would
receive in excess of 49% of the value of their accrued old age

The courts said that this was a "serious breach" of Ireland's
obligations, the Irish Times notes.

Judges ruled that offering retirees half of what they had been
promised under a defined benefit scheme does not amount to
protection by the state, the Irish Times discloses.  According to
the Irish Times, it said the economic situation of Ireland does
not constitute an exceptional situation capable of justifying a
lower level of protection of the interests of employees as
regards their entitlement to old-age benefits under a
supplementary occupational pension scheme.

The ten workers who took the case were a cross section of those
employed at the factory, the Irish Times notes.  About 1,700
workers are due defined benefit pensions.  On average, they were
worth EUR9,600 a year while the ten who took the case, who
included some long-serving skilled craft workers, had pensions
worth on average EUR19,000, the Irish Times states.

Unite said that if the Government contests liability in the
courts, it could end up costing EUR258 million in a one-off
payment to the pension fund.  If the state accepts then it could
be about EUR15 million a year, the Irish Times relates.

Waterford Crystal is a manufacturer of crystal.  It is named for
the city of Waterford, Ireland.  Waterford Crystal is owned by
WWRD Holdings Ltd., a luxury goods group which also owns and
operates the Wedgwood and Royal Doulton brands.


HOME CREDIT: Fitch Assigns 'BB-' Long-Term Issuer Default Rating
Fitch Ratings has assigned Kazakhstan-based Subsidiary Bank
Joint-Stock Company Home Credit and Finance Bank (HCK) a Long-
term Issuer Default Rating (IDR) of 'BB-' with a Stable Outlook.


The Long-term IDRs, National Rating and Support Rating reflect
the moderate probability of the bank receiving support in case of
need from its parent, Russia's Home Credit and Finance Bank
(HCFB, 'BB/Stable; bb'). Fitch's view on the probability of
support is based on the bank's full ownership by HCFB, its small
size relative to the parent (HCK accounts for 5% of HCFB's
assets, limiting the cost of any potential support) and
reputational risk for HCFB in case of the bank's default.

The one-notch difference between HCFB and HCK's ratings reflects
the cross-border nature of the parent-subsidiary relationship,
HCK's so far limited track record of operations and some
uncertainty about the long-term commitment of HCFB to support HCK
in case of a prolonged deterioration of the operating environment
in Kazakhstan.


Any positive or negative action on the parent's Long-term IDRs
would likely be matched by a similar action on HCK's Long-term
IDRs. This would also impact the National Rating and could result
in a change in the Support Rating.


The VR of 'b' reflects the bank's currently solid capitalization,
strong profitability and adequate asset quality. At the same
time, the VR is constrained by the bank's still short track-
record of healthy performance and limited franchise, higher than
average sensitivity to macroeconomic shocks, tight liquidity and
weak funding profile reflected in high single-name concentrations
and dependence on parent facilities.

HCK is a wholly-owned subsidiary of HCFB, which in turn is the
part of a broader Home Credit Group (Home Credit B.V.) with
activities in CEE, CIS and Asia. The group is in turn majority-
owned by PPF Group N.V., an industrially diversified holding
company controlled by Czech businessman Peter Kellner.

HCK is a small but rapidly growing (110% loan growth in 2012)
retail bank that focuses on issuing point-of-sale and cash loans
to lower mass-market customers. As with other mass-market retail
lenders, this makes the bank sensitive to macroeconomic
fundamentals due to the relatively low financial flexibility of
its borrowers.

HCK's asset quality is currently adequate. NPLs (non-performing
loans; 90 days overdue) increased to a still moderate 5% at end-
2012 from 2.8% at end-2011 with NPL generation reaching 7.7% of
average performing loans in 2012 as the bank tapped higher risk
clientele. Fitch expects credit losses to further increase as HCK
leverages up its borrowers with longer-term larger-ticket cash
loans, growth moderates and the rapidly acquired portfolio
seasons. However, the wide interest margin (26% in 2012) and
significant loan-related insurance commission (equal to 54% of
pre-impairment profit in 2012) offer considerable flexibility to
absorb losses, and Fitch estimates the current break-even loss
rate to be around 31% of average loans. At the same time, Fitch
notes that insurance commissions are recognized upfront at loan
origination, and as portfolio growth slows down bank's
profitability is likely to moderate significantly and the break-
even loss rate would also be lower.

HCK is currently reliant on funding provided by the group (37% of
liabilities at end-2012) and non-core corporate deposits (35% of
liabilities at end-2012). The latter are highly concentrated with
the largest five accounting for 28%, and the largest one 14%, of
end-2012 liabilities.

Liquidity is currently tight with liquid assets equal to only 9%
of liabilities at end-January 2013. Mitigating deposit withdrawal
risk to an extent, HCK's quickly amortizing loan book generates
KZT6bn of monthly repayments (equal to 11% of end-January 2013
liabilities). Management plans to reduce the bank's reliance on
parent's funding and corporate deposits by attracting wholesale
debt and shifting its focus to retail deposits. However, given
its currently modest franchise, HCK has yet to prove that it can
attract and retain retail depositors.

The current capital position is solid, with a Fitch core capital
ratio of 32% at end-2012 (28% at end-2011). However,
capitalization is likely to decline as internal capital
generation (43% in 2012), although high, is significantly below
expected loan growth rates. Further capital weakening could
follow when the bank starts paying dividends.


An extended track record of sound performance and growth
supported by a more diversified funding base would be positive
for the standalone profile. A significant deterioration of the
operating environment in Kazakhstan, or weaker performance of the
loan book would be negative and could lead to downward pressure
on the VR.

The rating actions are:

-- Long-term foreign currency IDR: 'BB-'; Outlook Stable
-- Short-term foreign currency IDR: 'B'
-- Long-Term local currency IDR: 'BB-'; Outlook Stable
-- National Long-Term Rating: 'BBB+(kaz)'; Outlook Stable
-- Viability Rating: 'b'
-- Support Rating: '3'


CID FINANCE: Fitch Maintains Watch Negative on 'BB-sf' Rating
Fitch Ratings has maintained CID Finance B.V. Series 54 on Rating
Watch Negative (RWN) as follows:

Series 54 rated 'BB-sf'; RWN maintained


The RWN is maintained due to the status on Unicaja Banco S.A.U.
('BBB-'/RWN/'F3' /RWN'). The notes are secured by a covered bond
issued by Unicaja (ISIN ES0458759034) that is not rated by Fitch.
The analysis was based on Fitch's rating of Unicaja Banco S.A.U.
representing a rating floor for the covered bond.


A rating action would be triggered if any of the three risk
presenting entities were to be subject to a rating action. The
risk presenting entities are Banco Bilbao Vizcaya Argentaria S.A.
(BBVA, 'BBB+'/Negative/'F2'), Deutsche Bank ('A+'/Stable/'F1+')
and Unicaja Banco S.A.U. ('BBB-'/RWN/'F3'/RWN).


NORILSK NICKEL: Fitch Affirms 'BB+' Long-Term IDR; Outlook Pos.
Fitch Ratings has affirmed Russia-based OJSC MMC Norilsk Nickel's
(NN) Long-term Issuer Default Rating (IDR) and senior unsecured
ratings at 'BB+. The Outlook on the Long-term IDR has been
revised to Positive from Stable. At the same time the agency has
affirmed the group's Short-term IDR at 'B'. The agency has
simultaneously assigned MMC Finance Limited's proposed issue of
loan participation notes an expected foreign currency senior
unsecured rating of 'BB+(EXP)'.

The notes' final rating is contingent on the receipt of final
documentation conforming to information already received and
final details regarding the notes' amount and tenor. Proceeds
from the notes will be used for refinancing as well as for
general corporate purposes.

The transaction is structured in the form of a loan from the
issuer, MMC Finance Limited, an Ireland-based limited liability
company established for this sole purpose, to the borrower, NN,
pursuant to the terms of a loan agreement. The notes are limited
recourse obligations of the issuer under a trust deed. They are
secured by a first-fixed charge with full title guarantee in
favor of the trustee for the benefit of itself and the
noteholders of certain of its rights and interests under the loan


Positive Outlook:
The revision of NN's Outlook to Positive follows the resolution
to the shareholder dispute involving United Company RUSAL Plc
(Rusal) and Interros Group, as well significant downward
revisions to future capex spending. In December 2012 Rusal and
Interros announced the signing of a shareholder agreement as well
as the introduction Crispian Investments Limited (a company
affiliated with Roman Abramovich) as an arbiter shareholder.

Corporate Governance:
NN's Long-term IDR continues to be notched down by three notches
from its standalone level due to a combination of issuer-specific
corporate governance factors and the weak Russian business
environment. The shareholder agreement and new shareholding
structure are positive developments, which should create a more
stable environment for company management and allow a refocusing
on its core Russian assets. After re-establishing a track record
of good corporate governance, the notching may be narrowed to two

Downward Revisions to Capex:
Fitch had previously factored in cash outgoings for capex of
around US$4 billion in both 2013 and 2014 for new project
development and plant modernization to reduce emissions. Forecast
spending has now been significantly reduced following recent
senior management changes with capex over the next two years now
expected to be around half the previous levels. However, this
reduction will be offset by higher dividend payments as specified
in the shareholder agreement (US$2 billion in 2013 and US$3
billion in 2014/15).

Financial Profile:
NN's 2012 results were in line with Fitch's expectations. Over
2013-2015, we expect largely stable EBITDAR margins of around 36-
40%. Free cash flow over this period is expected to be
consistently negative resulting in FFO gross leverage peaking at
2.0x in 2014. Leverage levels could be lower if flexibility is
evident in dividend levels or if the company is successful in
maximizing non-core asset sales proceeds.

Exceptional Operational Profile:
NN's operational strength stems from its core Russian assets on
the Taimyr Peninsula, which benefit from a uniquely rich ore body
and long-life reserves. The company has more than 12% of proved
and probable nickel ore reserves in the world.

Leading Market Positions:
NN is the world's largest producer of nickel and palladium,
providing approximately 17% and 41% of world total output,
respectively. The company is also a leading producer of platinum
and copper.

Country and Industry Risks:
Key rating constraints include NN's exposure to the base metal
demand cycle as well as the higher than average legal, business
and regulatory risks associated with Russia ('BBB'/Stable'). With
respect to the former, NN's industry leading cost position
provides some protection compared to peers.


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

- Re-establishment of a track record of good corporate governance
  over the next 12-18 months could result in an upgrade to 'BBB-'
  based upon a narrowing of the corporate governance notching to
  two notches.

- An upgrade of NN's standalone rating based upon its financial
  and operational characteristics is not considered likely at
  this time.

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

- Re-occurrence of negative corporate governance events would
  likely result in the Outlook being revised to Stable from

- Large debt funded acquisitions and/or significantly higher
  than expected capex, dividend or operating cost inflation
  resulting in FFO gross leverage sustained in excess of
  2.5x could result in a downgrade.

* LIPETSK REGION: Fitch Assigns 'BB' Rating to RUB3-Bil. Bond
Fitch Ratings has assigned the Russian Lipetsk Region's upcoming
RUB3 billion domestic bond issue, due April 17, 2020, an expected
Long-term local currency rating of 'BB(EXP)' and an expected
National Long-term rating of 'AA-(rus)(EXP)'.

Final ratings are contingent upon the receipt of final documents
conforming to information already received.


The bond represents a senior and unsecured obligation of the
Russian Lipetsk Region. The region has Long-term local and
foreign currency ratings of 'BB' and a National Long-term rating
of 'AA-(rus)'. The Long-term ratings have Stable Outlooks. The
region's Short-term foreign currency rating is 'B'.

Fitch forecasts Lipetsk Region will maintain a satisfactory
budgetary performance with an operating margin at about 8-10% in
2013-2014 driven by continued economic growth. The agency expects
the region's direct risk, including direct debt, to remain
moderate at about 30% of current revenue in 2013.

Lipetsk Region is located in the center of the European part of
Russia. The region contributed 0.7% of the Russian Federation's
GDP in 2010 and accounted for 0.8% of the country's population.

The bond issue has a fixed-rate coupon. The initial coupon rate
will be set on April 26, 2013, the day of placement. The
principal will be amortized by 15% of the initial bond issue
value in April 2015, by 10% of the initial bond issue value in
July 2016 and by 15% of the initial bond issue value in October
2017, October 2018 and July 2019. The remaining 30% will be
redeemed on 17 April 2020. The proceeds from the bond issue will
be used to refinance maturing debt and to fund the region's
budget deficit.


The issue's rating would be sensitive to any movement in the
Lipetsk Region's Long-term local currency rating.

* RUSSIA: Moody's Notes Stability of RMBS Market in 2013
Performance in the Russian residential mortgage-backed securities
(RMBS) market will be stable throughout 2013, says Moody's
Investors Service in a Special Comment report entitled " Russian
RMBS: Performance will be stable through 2013."

The presence of government-backed RMBS purchase programs
primarily explains the stability and renewed growth of the
Russian RMBS market.

"This performance stability, as well as improving origination and
servicing standards, underpins our current stable outlook on the
Russian RMBS market," says Olga Gekht, a Moody's Vice President
-- Senior Credit Officer and author of the report.

The Russian RMBS market has grown significantly since the end of
the 2008-09 financial crisis and has reached record levels due to
new entrants and new products. Underwriting standards are tighter
than before the crisis, as only a handful of originators
currently offer mortgages with loan-to-value ratios of 95%. The
use of credit bureaus is also becoming standard practice, which
greatly improves the quality and quantity of information

However, concerns remain over grey income, the inaccuracy of
credit records and overvaluations.

Moody's expects to see around 10 new RMBS transactions in Russia
for 2013, versus seven in 2012, with an anticipated issuance
volume in the range of RUB50-60 billion. The rating agency
expects that some first-time issuers from 2012 will come back for
more funding, as well as some non-government investors entering
the RMBS market in 2013.


* SLOVENIA: Banks Need EUR900MM of Capital Injection by End-July
Boris Cerni at Bloomberg News reports that Slovenian banks
including Nova Ljubljanska Banka d.d and Nova Kreditna Banka
Maribor d.d. will need a capital injection of at least EUR900
million (US$1.2 billion) by the end of July as the government
works to fix the banking industry without seeking outside aid.

The government of Prime Minister Alenka Bratusek, in power for
five weeks, included a list of priorities in a draft document
posted Tuesday on the Web site of the parliament in Ljubljana,
Bloomberg relates.  According to Bloomberg, it said the plan will
be sent to European officials by May 9.

The government, as cited by Bloomberg, said that lenders may need
more, depending on how the Slovenian economy develops and how
much money will be transferred to a bad bank currently being set

The Adriatic nation, the first post-communist country to adopt
the euro in 2007, is struggling to avoid asking for outside
assistance after its bond yields advanced to record levels
earlier this month on concern over its faltering banking
industry, Bloomberg discloses.  Fitch ratings said April 5 the
three top banks, NLB, Nova Kreditna and Abanka Vipa (ABKN) d.d.
need EUR2 billion of fresh capital, Bloomberg recounts.

In addition to any capital injection, the government plans to
exchange bad loans for as much as EUR4 billion of state-
guaranteed bonds, Bloomberg notes.


BANKIA SA: To Rule on Event of Default Under Credit Default Swaps
Creditflux reports that the International Swaps and Derivatives
Association, Inc. credit derivatives determinations committee on
Wednesday accepted a request to rule on whether the choice given
to subordinated note holders in nationalized Spanish lender
Bankia constitutes a default under credit default swaps.

According to Creditflux, the request comes following a statement
from the Fondo de Reestructuracion Ordenada Bancaria on April 16
which spells out how sub debt will be bailed in.

Subordinated and hybrid note holders will have the option to
choose between exchanging thier bond for zero-coupon senior notes
with a haircut depending on maturity or shares in Bankia,
Creditflux notes.

Bankia is a Spanish banking conglomerate that was formed in
December 2010, consolidating the operations of seven regional
savings banks.  As of 2012, Bankia is the fourth largest bank of
Spain with 12 million customers.

BANKIA SA: Returns to Profitability Following Record Loss
Tobias Buck at The Financial Times reports that Bankia, the
lender that came to symbolize Spain's financial crisis, revealed
on Wednesday that it managed to return to profitability -- less
than two months after reporting the biggest loss in the country's
corporate history.

The nationalized bank reported net profits of EUR72 million for
the first quarter of the year, the FT discloses.  It was the
first quarterly earnings report since Bankia received EUR15.5
billion in fresh capital from the Spanish government, in a
process that in effect wiped out the holdings of some 350,000
retail investors who bought into the bank's initial flotation
less than two years ago, the FT notes.

Bankia was created through a merger of seven regional savings
banks in 2011, in a government-backed attempt to create a retail
banking behemoth, the FT recounts.  But the group quickly fell
victim to the collapse of Spain's housing bubble, forcing the
government to seek European Union aid to restore Bankia's
shredded balance sheet, the FT relates.

Net interest income, a measure of the income generated by a
bank's core lending activities, fell from EUR844 million in the
first quarter in 2012 to EUR512 million this year, the FT

As part of the government bail-out, Bankia is being forced to
drastically shrink its balance sheet and high street presence,
the FT says.  The bank will have to close 1,100 branches around
the country, more than a third of its network, the FT states.
Brussels has given the management three years to achieve that
target, but Bankia executives revealed on Wednesday that they
would complete the branch closures in the next eleven months, the
FT notes.

Bankia, as cited by the FT, said it had already shuttered 197
branches in the first quarter.

Bankia is a Spanish banking conglomerate that was formed in
December 2010, consolidating the operations of seven regional
savings banks.  As of 2012, Bankia is the fourth largest bank of
Spain with 12 million customers.

TDA IBERCAJA 2: Moody's Downgrades Rating on Class E Notes to Ca
Moody's Investors Service downgraded the ratings of 14 junior and
five senior notes in five Spanish residential mortgage-backed
securities (RMBS) transactions: TDA Ibercaja 1, FTA; TDA Ibercaja
2, FTA; TDA Ibercaja 5, FTA; TDA Ibercaja 6, FTA and TDA Ibercaja
7, FTA. At the same time, Moody's confirmed the ratings of TDA
Ibercaja 5 A1 tranche. Insufficiency of credit enhancement to
address sovereign risk and, in the case of TDA Ibercaja 7,
exposure to counterparty risk, have prompted the downgrade

The rating action concludes the review of four notes placed on
review on December 16, 2011, following increase of expected loss
assumption and expectations that credit enhancement could be
insufficient to offset this increase. This rating action also
concludes the review of five notes placed on review on July 2,
2012, following Moody's downgrade of Spanish government bond
ratings to Baa3 from A3 on June 2012 and of 11 notes placed on
review on November 23, 2012, following Moody's revision of key
collateral assumptions for the entire Spanish RMBS market.

Ratings Rationale:

The rating action primarily reflects the insufficiency of credit
enhancement to address sovereign risk. The rating action on
senior note of TDA Ibercaja 7 also reflects the exposure to
Ibercaja Banco SA (Ba2 on review for possible downgrade /NP) and
Banco Santander S.A. Spain (Baa2/P-2) acting as collection
account bank and reinvestment account bank respectively. Moody's
confirmed the rating of a security whose credit enhancement and
structural features provided enough protection against sovereign
and counterparty risk.

The determination of the applicable credit enhancement driving
these rating actions reflects the introduction of additional
factors in Moody's analysis to better measure the impact of
sovereign risk on structured finance transactions.

Additional Factors Better Reflect Increased Sovereign Risk

Moody's has supplemented its analysis to determine the loss
distribution of securitized portfolios with two additional
factors, the maximum achievable rating in a given country (the
local currency country risk ceiling) and the applicable portfolio
credit enhancement for this rating. With the introduction of
these additional factors, Moody's intends to better reflect
increased sovereign risk in its quantitative analysis, in
particular for mezzanine and junior tranches.

The Spanish country ceiling, and therefore the maximum rating
that Moody's will assign to a domestic Spanish issuer including
structured finance transactions backed by Spanish receivables, is
A3. Moody's Individual Loan Analysis Credit Enhancement (MILAN
CE) represents the required credit enhancement under the senior
tranche for it to achieve the country ceiling. By lowering the
maximum achievable rating for a given MILAN, the revised
methodology alters the loss distribution curve and implies an
increased probability of high loss scenarios.

Pro-rata vs. current amortization of Classes A1 and A2 in TDA
Ibercaja 5

The rating action takes into account the relative priority of
principal payments within the A notes of TDA Ibercaja 5. The
performance conditions for current amortization between the A
sub-classes (18% of Available Funds for class A for series A1 and
the remaining 82% for series A2) currently hold, and the notes
are not anticipated to amortize pro-rata in Moody's expected
scenario. This leads to a one notch difference in the Class A1
rating compared to the Class A2 rating in this transaction.

Moody's has not revised the key collateral assumptions for any of
the deals. Expected loss assumptions as a percentage of original
pool balance remain at 0.47% for TDA Ibercaja 1; 0.55% for TDA
Ibercaja 2; 1.50% for TDA Ibercaja 3; 2.40% for TDA Ibercaja 6
and 2.00% for TDA Ibercaja 7. The MILAN CE assumptions remain at
10% for the TDA Ibercaja 1, 2 and 5 and 12.5% for TDA Ibercaja 6
and 7.

Exposure to Counterparty Risk

The conclusion of Moody's rating review takes into consideration
the exposure to Ibercaja Banco SA (Ba2 on review for possible
downgrade /NP), which acts as servicer and collection account
bank in all Ibercaja transactions. Treasury Accounts are held by
Barclays Bank PLC for all five deals. Reinvestment Accounts are
held by Barclays Bank PLC for TDA Ibercaja 1, 2 and 5.
Reinvestment Accounts in TDA Ibercaja 6 and 7 are held by Bank of
Spain and Banco Santander (Baa2/P-2), respectively. The exposure
to collection account bank and reinvestment account holder has a
negative impact only on the rating of Class A notes in TDA
Ibercaja 7.

As part of its analysis Moody's also assessed the exposure to
Banco Santander (Baa2/P-2) as swap counterparty for TDA Ibercaja
1, 2 and 5 and Banesto (Baa3/P-3 on review for possible upgrade)
for TDA Ibercaja 6 and 7. The revised ratings of the notes, are
not negatively affected by this exposure.

Other Developments May Negatively Affect the Notes

In consideration of Moody's new adjustments, any further
sovereign downgrade would negatively affect structured finance
ratings through the application of the country ceiling or maximum
achievable rating, as well as potentially increased portfolio
credit enhancement requirements for a given rating.

As the euro area crisis continues, the ratings of structured
finance notes remain exposed to the uncertainties of credit
conditions in the general economy. The deteriorating
creditworthiness of euro area sovereigns as well as the weakening
credit profile of the global banking sector could further
negatively affect the ratings of the notes.

Moody's describes additional factors that may affect the ratings
in "Approach to Assessing Linkage to Swap Counterparties in
Structured Finance Cashflow Transactions: Request for Comment."

The methodologies used in these ratings were Moody's Approach to
Rating RMBS Using the MILAN Framework, published in March 2013
and The Temporary Use of Cash in Structured Finance Transactions:
Eligible Investment and Bank Guidelines published in March 2013.

In reviewing these transactions, Moody's used its cash flow
model, ABSROM, to determine the loss for each tranche. The cash
flow model evaluates all default scenarios that are then weighted
considering the probabilities of the lognormal distribution
assumed for the portfolio default rate. In each default scenario,
Moody's calculates the corresponding loss for each class of notes
given the incoming cash flows from the assets and the outgoing
payments to third parties and note holders. Therefore, the
expected loss for each tranche is the sum product of (1) the
probability of occurrence of each default scenario and (2) the
loss derived from the cash flow model in each default scenario
for each tranche.

In the context of the rating review, the transactions have been
remodeled and some inputs have been adjusted to reflect the new
approach. In addition, the following have been corrected during
the review: notes margins and PDL mechanism were corrected in TDA
Ibercaja 2; notes margins, one of the triggers switching the
priority of payments, one of the triggers for reserve fund
amortization and tranche C interest deferral trigger were
corrected for TDA Ibercaja 5; Class E margin, one of the triggers
switching the priority of payments and one of the triggers for
reserve fund amortization were corrected for TDA Ibercaja 6.

As such, Moody's analysis encompasses the assessment of stressed

List of Affected Ratings

Issuer: TdA Ibercaja 1, Fondo de Titulizacion de activos

EUR577.2M A Notes, Downgraded to Baa1 (sf); previously on Jul 2,
2012 Downgraded to A3 (sf) and Remained On Review for Possible

EUR15.3M B Notes, Downgraded to Ba2 (sf); previously on Nov 23,
2012 Downgraded to Baa2 (sf) and Remained On Review for Possible

EUR3.6M C Notes, Downgraded to Ba3 (sf); previously on Jul 2,
2012 Baa2 (sf) Placed Under Review for Possible Downgrade

EUR3.9M D Notes, Downgraded to B1 (sf); previously on Jul 2, 2012
Ba1 (sf) Placed Under Review for Possible Downgrade

Issuer: TdA Ibercaja 2, Fondo de Titulizacion de activos

EUR870.3M A Notes, Downgraded to Baa2 (sf); previously on Nov 23,
2012 Downgraded to Baa1 (sf) and Remained On Review for Possible

EUR19.3M B Notes, Downgraded to Ba3 (sf); previously on Nov 23,
2012 Downgraded to Baa2 (sf) and Remained On Review for Possible

EUR6.3M C Notes, Downgraded to B2 (sf); previously on Dec 16,
2011 Baa2 (sf) Placed Under Review for Possible Downgrade

EUR4.1M D Notes, Downgraded to B3 (sf); previously on Dec 16,
2011 Ba2 (sf) Placed Under Review for Possible Downgrade

EUR4.5M E Notes, Downgraded to Ca (sf); previously on Nov 23,
2012 Downgraded to Caa2 (sf) and Remained On Review for Possible

Issuer: TdA Ibercaja 5, Fondo de Titulizacion de Activos

EUR150M A1 Notes, Confirmed at Baa1 (sf); previously on Nov 23,
2012 Downgraded to Baa1 (sf) and Remained On Review for Possible

EUR1002M A2 Notes, Downgraded to Baa2 (sf); previously on Nov 23,
2012 Downgraded to Baa1 (sf) and Remained On Review for Possible

EUR32.4M B Notes, Downgraded to B2 (sf); previously on Nov 23,
2012 Downgraded to Baa2 (sf) and Remained On Review for Possible

EUR10.8M C Notes, Downgraded to Caa1 (sf); previously on Nov 23,
2012 Downgraded to B2 (sf) and Remained On Review for Possible

EUR4.8M D Notes, Downgraded to Caa3 (sf); previously on Nov 23,
2012 Downgraded to Caa1 (sf) and Remained On Review for Possible

Issuer: TdA Ibercaja 6,Fondo de Titulizacion de Activos

EUR1440M A Notes, Downgraded to Baa2 (sf); previously on Nov 23,
2012 Downgraded to Baa1 (sf) and Remained On Review for Possible

EUR30M B Notes, Downgraded to B1 (sf); previously on Nov 23, 2012
Downgraded to Baa2 (sf) and Remained On Review for Possible

EUR15M C Notes, Downgraded to B3 (sf); previously on Dec 16, 2011
Baa2 (sf) Placed Under Review for Possible Downgrade

EUR15M D Notes, Downgraded to Caa2 (sf); previously on Dec 16,
2011 Ba3 (sf) Placed Under Review for Possible Downgrade

Issuer: TdA Ibercaja 7, Fondo de Titulizacion de activos

EUR1900M A Notes, Downgraded to Baa2 (sf); previously on Jul 2,
2012 Downgraded to A3 (sf) and Placed Under Review for Possible

EUR100M B Notes, Downgraded to B1 (sf); previously on Jul 2, 2012
Ba3 (sf) Placed Under Review for Possible Downgrade

* SPAIN: Bad Bank Asset Transfer Offset By Cedulas Cancellations
The transfer of assets from several Spanish banks, including
Bankia, NCG Banco and Catalunya Banc, to Spain's bad bank (SAREB)
has reduced the size of the collateral available to investors in
cedulas, Fitch Ratings says. However, investors remain protected
because it is riskier loans that have been transferred and
because banks have amortized outstanding cedulas.

Fitch says: "The asset transfer has triggered an average drop of
14% in the total overcollateralization (OC) of these banks
because the SAREB bonds are not included as collateral, whereas
the mortgages for which they were exchanged were, according to
our latest "Multi-Issuer Cedulas Hipotecarias OC Tracker" report,
published yesterday. However, the vast majority of mortgages that
have been transferred to SAREB are troubled developer loans, as
we stated in October. Consequently, the reduction in security
value after credit and market value stresses is relatively small.

"Removing these assets has lowered our estimated per cent losses
for the cover pool, which means the cedulas can achieve almost
the same level of protection despite the reduced security. The
larger proportion of higher credit-quality residential assets
that remain and a reduced refinancing rates stress has also cut
our loss estimates under all rating stresses.

"Fitch continues to monitor cedulas and multi-issuer cedulas
because the quality of the cover pools is still challenged by the
continued fall in Spanish house prices, which has led us to
increase our assumptions for market value decline.

"While total OC has fallen, the eligible OC, which only includes
the higher-quality mortgages, has actually increased by 8%
because issuers have amortized or cancelled some of their
existing cedulas. These retired cedulas are likely to be those
that were retained for use as repo collateral with the European
Central Bank."

* SPAIN: Moody's Expounds on Rating in New Credit Report
In its annual credit report on Spain, Moody's Investors Service
says that the Baa3 government bond rating is based on the
country's moderate economic strength, high institutional strength
as well as low government financial strength, which contribute to
its high susceptibility to event risk. The downside risks to
Spain's sovereign creditworthiness are material, arising mainly
from the weak growth outlook and its impact on the public
finances and the public debt trajectory, and are reflected in the
negative outlook on the rating.

The rating agency's report is an annual update to the markets and
does not constitute a rating action.

Moody's determines a country's sovereign rating by assessing it
on the basis of four key factors -- economic strength,
institutional strength, government financial strength and
susceptibility to event risk -- as well as the interplay between

Moody's says that Spain's moderate economic strength score
balances the size of its economy as one of world's largest with
broad diversification and high wealth levels, with its negative
short and medium-term growth prospects. The rating agency expects
the recession to continue in 2013 and there is significant
uncertainty over Spain's medium to longer-term growth trajectory
given the need for all sectors of the economy to reduce their
high debt levels over the coming years. Moody's central growth
scenario anticipates that the Spanish economy will return to
positive -- albeit very moderate -- growth in 2014; however, the
downside risks to this scenario are material. A significantly
weaker economic performance that has consequences for public
finances and the public debt trajectory constitutes a downside
risk for Spain's rating.

Moody's assesses Spain's institutional strength as high, given
the important economic reforms implemented over the past two
years, namely of the labor market, the pension system and more
recently the framework for regional government finances. The
government also started to address the substantial fiscal
deterioration in 2012 and the restructuring of the banking system
has been significantly accelerated following the support
agreement with the euro area partners. These are positive and
crucial steps to bring the economy and public finances back onto
a sustainable path and as such support the rating agency's
assessment of high institutional strength. On the other hand,
Moody's remains concerned about repeated upward revisions to
budget deficit outcomes, which damage the government's fiscal

Government financial strength is considered by Moody's to be low,
reflecting the difficulties the government is facing in returning
its public finances to a sustainable path and stabilizing the
public debt. The current rating is based on the rating agency's
assumption of a gradual further reduction in the budget deficit
to 5%-5.5% of GDP in 2014 from the 2012 level of 7% of GDP
(excluding capital injections into the banking sector). This
trajectory takes into account the very weak economic
circumstances. Under these assumptions the public debt ratio will
continue to rise and will probably only stabilize after the
middle of the decade at above 100% of GDP. This forecast includes
the full amount of EUR100 billion available under Spain's banking
sector support package as Moody's continues to see a significant
probability that the Spanish banking sector will require further
capital support.

Spain's susceptibility to event risk is considered to be high,
mainly reflecting the continuing risks emanating from the banking
sector as well as events in the wider euro area. The move towards
'bailing-in' bank creditors (and uninsured depositors) is in
principle positive for sovereign balance sheets. However, this
might be achieved at the cost of increasing the risk of deposit
runs and higher bank funding costs, with unclear eventual
consequences for a sovereign. Also, progress towards banking
union remains slow, against the background of continuing
divergent opinions between member states. Moody's views the
unpredictability of policy responses and the lack of progress in
strengthening the euro area as key risk factors that can
undermine the progress achieved to date.


TURKIYE SISE: Moody's Assigns Ba1 Corporate Family Rating
Moody's Investors Service assigned a Ba1 corporate family rating
and Ba1-PD probability of default rating to Turkiye Sise ve Cam
Fabrikalari A.S. ("Sisecam"), a Turkish industrial manufacturer
of glass products and chemicals.

At the same time, Moody's has also assigned a provisional (P)Ba1
rating to the company's proposed issuance of US$500 million
senior unsecured notes. All the ratings have a stable outlook.
This is the first time that Moody's has assigned ratings to

"The Ba1 ratings we have assigned to Sisecam balance the risks
associated with the company's large-scale investment plan in
emerging markets with its dominant market position in Turkey and
healthy financial profile," says Rehan Akbar, an Analyst in
Moody's Corporate Finance Group and analyst for Sisecam.

Ratings Rationale:

Sisecam's Ba1 ratings primarily reflect (1) investment and
execution risk related to the company's large-scale growth plans
in Turkey, Russia and other emerging markets; (2) geographic
concentration risk, as half of all the company's revenues are
derived from the domestic market; (3) significant energy cost
increases in Turkey, which have created uncertainty regarding the
company's future profitability; and (4) the risk of production
capacity increases that do not translate into revenue growth.

However, these challenges are partially offset by Sisecam's (1)
dominant market position in Turkey's glass industry; (2) balanced
product mix, which diversifies the company's revenue base and
mitigates its exposure to a single product line; and (3) strong
credit metrics relative to similarly rated peers as a result of
the historically high profit margins recorded by the company, as
well as its prudent approach towards leverage and liquidity

The assigned provisional (P) Ba1 instrument rating is on par with
the Ba1 CFR. The proposed bond is guaranteed on a partial and
several basis by three out of the four flagship companies, with
bond holders not having any recourse to the guarantors for
amounts in excess of the guaranteed obligations. Moody's has
taken the view that the structural subordination of the notes is
mitigated by 80% of the bond issuance being the direct and
unsecured obligations of the relevant operating companies (as
guarantors) and ranking pari passu with all other unsecured,
unsubordinated obligations of the relevant guarantor. The
instrument rating is subject to the review of final

Sisecam has adequate liquidity, with funds from operations
sufficient to fund normal operating requirements and maintenance
capital expenditure (capex), although Moody's expects that
expansionary capex will require additional borrowings and reduce
cash balances.

Stable Outlook

The stable outlook on the ratings incorporates Moody's view that
management will continue to strategically increase its geographic
footprint while maintaining leverage, as measured by debt/EBITDA,
below 3.0x. The outlook also incorporates Moody's expectation
that Sisecam will return to positive free cash flow generation
beyond 2014 following a decline in capital spending.

What Could Change The Rating Up/Down

Positive rating pressure could build if Sisecam is able to
improve its profitability, reflected by an EBITDA margin above
20% and cash flow coverage (as measured by free cash flow/debt)
above 10% on a sustainable basis. Additionally, an upgrade would
require Sisecam to diversify and strengthen its geographical
footprint so as to mitigate against event risks while maintaining
debt/EBITDA below 2.5x.

Conversely, Sisecam's rating could come under negative rating
pressure if the group's liquidity deteriorates during its
investment phase. Moody's could consider downgrading Sisecam if
the group faces a structural decline in profitability such that
its EBITDA margin is below 15% while its debt/EBITDA rises above

Principal Methodology

The principal methodology used in this rating was the Global
Manufacturing Industry published in December 2010. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.

Founded in 1935, Sisecam is a Turkish industrial manufacturer of
glass products as well as soda ash and chromium-based chemicals.
Sisecam has four business segments operating through its core
subsidiaries, namely Trakya Cam Sanayii A.S. (flat glass),
Pasabahce Cam Sanayii ve Tic A.S. (glassware), Anadolu Cam
Sanayii A.S. (glass packaging) and Soda Sanayii A.S. (chemicals).
Sisecam is 65.5% owned by Turkiye Is Bankasi A.S., with an
additional 26.3% listed on Borsa Istanbul.

As of year-end 2012, Sisecam reported consolidated revenues of
TRY5.34 billion (US$2.98 billion) and an operating profit of
TRY430 million (US$240 million), with sales from its
international manufacturing facilities constituting 21.2% of
total revenues.

TURKIYE SISE: S&P Assigns 'BB+' Corp. Rating; Outlook Stable
Standard & Poor's Ratings Services said that it assigned its
'BB+' long-term local and foreign currency and 'B' short-term
global scale corporate credit ratings to Turkey-based glass
manufacturer Turkiye Sise ve Cam Fabrikalari A.S. (Sisecam).  The
outlook is stable.

At the same time, S&P assigned its issue rating of 'BB+' to the
US$500 million (about Turkish lira (TRY) 895 million) proposed
unsecured notes to be issued by Sisecam.  The recovery rating on
the notes is '3', indicating S&P's expectation of meaningful
(50 percent-70 percent) recovery prospects for unsecured
noteholders in the event of a payment default.

The ratings on Sisecam reflect S&P's assessment of the group's
"fair" business risk profile and "intermediate" financial risk
profile.  Turkey's largest commercial bank Turkiye Is Bankasi AS
(Isbank; BB+/Stable/B) owns a controlling (65 percent) stake in
Sisecam. A stake of the group's shares (currently about
28 percent) has been publicly traded on the Borsa Istanbul
(formerly the Istanbul Stock Exchange) since 1986.

"Our assessment of Sisecam's business risk profile as "fair"
reflects the group's leading and dominant market positions in
Turkey.  The group's core operating companies rank No. 1 in
Turkey in terms of sales, supported by strong local brands and
distribution networks.  Sisecam's product diversity is relatively
strong compared with many of its peers, although the group
operates predominately as a glass manufacturer.  Its key segments
are flat glass, glassware, and glass packaging, as well as
chemicals (soda ash and chromium), which support glass
production. As such, end markets are varied, but some of them are
cyclical--for example, the majority of flat glass sales are to
architectural and automotive glass markets," S&P said.

"Our assessment of Sisecam's financial risk profile as
"intermediate" reflects our view of the group's "moderate"
financial policy--including funds from operations (FFO) to debt
that we forecast will weaken to about 30 percent in 2013 on an
adjusted basis--and "less than adequate" liquidity.  We
anticipate that the group's ambitious global expansion strategy
will require a continued high level of investment to support
growth, and therefore we forecast that free operating cash flow
(FOCF) will remain negative in 2013 and 2014.  However, we expect
that Sisecam will generate significant positive FOCF once it has
completed its heavy investment cycle from 2015 onward, provided
that the group executes its expansion plans successfully.  At
this time, we believe that the enlarged group may be able to
support a "satisfactory" business risk profile," S&P added.

In S&P's view, Sisecam's leading market positions in Turkey and
its ambitious global expansion plans will support credit metrics
commensurate with the ratings over the next 12-24 months.
Specifically, this means adjusted FFO to debt of about 30

S&P could lower the rating if FFO to debt falls to less than
30 percent for a sustained period, or if the group suffers
liquidity issues.  This could occur as a result of inflated raw
material or energy costs, a significant weakening in demand, or
the unsuccessful execution of the group's sizable capacity
expansion plans.

Upside rating potential depends on an improvement in the group's
liquidity position to "adequate" and a sustainable improvement in
its financial performance above S&P's guidelines for the ratings.
This could occur once the group has competed its heavy investment
cycle and starts to generate positive FOCF.

U N I T E D   K I N G D O M

Moody's Investors Service upgraded HellermannTyton Alpha
S.a.r.l's Corporate Family rating to Ba3 and the group's
Probability of Default rating to Ba3-PD following the successful
Initial Public Offering of the group on the London Stock
Exchange. Concurrently Moody's has upgraded to B1 the rating
assigned to EUR220 million of senior secured guaranteed notes
issued by HellermannTyton Finance Plc, a UK- based finance
vehicle, guaranteed by HellermannTyton Alpha S.a.r.l.

The rating action concludes the rating review process initiated
by Moody's on March 6, 2013.

Ratings Rationale:

HellermannTyton has successfully closed its Initial Public
Offering on the London Stock Exchange raising gross proceeds of
approximately GBP212 million (EUR249 million) comprising primary
sales of shares worth approximately GBP30 million (EUR35 million)
by HellermannTyton and secondary sale of shares of approximately
GBP182.1 million (EUR213.5 million) by its major shareholder
Doughty Hanson and certain other shareholders. Dougthy Hanson
will continue to hold 46.1% in HellermannTyton and will not be
allowed to sell further shares over the 180 days following the

The IPO has lead to a slight improvement in leverage ratios, if
measured on a net debt basis. The proceeds provide
HellermannTyton the option to grow the business by using
additional liquidity available, which in turn will also lead to
improved credit metrics over time assuming that the company does
not pursue large partly debt financed acquisitions. More broadly
the listing of HellermannTyton will bring the group increased
financial flexibility in the future and might also have a
positive impact on the customer's perception of HellermannTyton's
financial strength and flexibility.

On a more negative note the group's publicly announced dividend
policy with a payout ratio of 30%-40% of net income will reduce
expected free cash flow generation to just break-even levels.
Consequently Moody's expects little debt reduction in the short
to medium term. However the capital structure of HellermannTyton
was solid at fiscal year-end 2012 with Debt/EBITDA of 2.6x,
RCF/Net debt of 34.4%.

For 2013 Moody's expects trading conditions to remain challenging
especially for the group's activities exposed to European
passenger car markets. However Moody's believes that
HellermannTyton should be able to grow its top line by low single
digits supported by capex in excess of maintenance expenditures
and to maintain broadly flat EBITDA margins. Leverage is
forecasted to stay broadly stable.

HellermannTyton's liquidity profile is adequate. The company had
EUR50 million of cash & marketable securities on balance sheet
(EUR85 million pro-forma of the IPO) and access to an undrawn
EUR80 million revolving credit facility at fiscal year-end 2012.
Alongside the group's expected operating cash flow generation
(pre-Working capital) this should be more than sufficient to fund
all operating needs of the group mainly consisting of working
cash (estimated at approximately 3% of revenues), working capital
requirements and capex. The company's revolver includes one net
leverage financial covenant with ample headroom.

A rating upgrade to Ba2 is currently unlikely. Moody's would
consider upgrading the rating if HellermannTyton could reduce
leverage as measured by Debt/EBITDA to below 2.5x on a
sustainable basis (2.6x in 2012), achieve FCF/Debt in the mid
single digits and keep current margin levels through the cycle.

Negative pressure on the rating would develop if Debt/EBITDA
would be trending towards 3.5x and / or if free cash flow
generation would become negative leading to a deterioration of
the liquidity position of the group.

The principal methodology used in these ratings was the Global
Manufacturing Industry published in December 2010. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.

Established in 1930, HellermannTyton is a global leading
manufacturer and distributor of cable management systems and
solutions including fastening, identifying, insulating,
protecting, organizing, routing and connectivity. The company
operates 11 manufacturing plants and employs over 3,000 people.
HellermannTyton reported revenues of EUR514 million and an
adjusted EBITDA of EUR100 million in 2012.

HellermannTyton was fully owned by UK-based private equity firm
Doughty Hanson, which acquired the business from Spirent in 2006
in a primary LBO.

HERCULES PLC: S&P Downgrades Rating on Class D Notes to 'B-'
Standard & Poor's Ratings Services lowered and removed from
CreditWatch negative its credit ratings on HERCULES (ECLIPSE
2006-4) PLC's class A, B, C, and D notes.  At the same time, S&P
has affirmed its rating on the class E notes.

On Dec. 6, 2012, S&P placed its ratings on the class A, B, C, and
D notes on CreditWatch negative following an update to its
criteria for rating European commercial mortgage-backed
securities (CMBS) transactions.

The rating actions follow S&P's review of the credit quality of
the underlying loans under its updated criteria.

               CHAPELFIELD LOAN (26.6% OF THE POOL)

The loan (GBP207.4 million) is secured against a single prime
shopping center in Norwich, East Anglia (Chapelfield Shopping
Centre).  The loan has scheduled amortization and matures in
April 2016.

Chapelfield Shopping Centre has a net leasable area of
approximately 500,000 sq ft and 1,000 basement car parking
spaces. The property is 97.27% occupied and leased to a number of
nationally recognized high street retailers with a weighted-
average unexpired lease term (WAULT) of 8.3 years (until first

In January 2013, the issuer reported a securitized loan-to-value
(LTV) ratio of 85%, based on a July 2012 valuation, and a
securitized interest coverage ratio (ICR) of 1.57x.

S&P expects losses on this loan in its base case scenario.

               RIVER COURT LOAN (26.5% OF THE POOL)

The securitized loan has an outstanding balance of
GBP206.9 million (87% of the whole loan).  There is additional
debt of GBP31 million, which does not form part of this

The loan, which matures on Oct. 17, 2016, is secured against a
single office property located on Fleet Street in London and
serves as Goldman Sachs International's European headquarters.
The property is 100% let to two tenants, Goldman Sachs and Boots,
with more than 97% of the income coming from Goldman Sachs and a
WAULT of 7.6 years.

In January 2013, the issuer reported a securitized LTV ratio of
68%, based on a June 2006 valuation, and a securitized ICR of

S&P do not expect losses on the securitized loan in its base case

               CANNON BRIDGE LOAN (19.9% OF THE POOL)

The securitized loan has an outstanding balance of GBP155 million
(86% of the whole loan).  There is additional debt of
GBP25.9 million, which does not form part of this transaction.

The loan was restructured (after being transferred to special
servicing) in March 2010 and the loan maturity date was extended
to Jan. 17, 2015 from July 2011.

This loan is secured against an office property located over
Cannon Street mainline train station in London.  The property is
288,075 sq ft, multitenanted, and 100% occupied.  The top five
tenants account for 89% of the income with a weighted-average
lease term of five years and 10 months (until lease break).  The
WAULT for the entire property is five years and eight months
(until lease break).

In January 2013, the issuer reported a securitized LTV ratio of
102%, based on a December 2012 valuation, and a securitized ICR
of 1.41x.

S&P expects losses on this loan in its base case scenario.

               REMAINING LOANS (27.1% OF THE POOL)

The four remaining loans account for about 27% of the remaining
pool.  The loans are secured by 168 mixed-use (care homes,
warehouse, retail, and offices) U.K. properties.

Of the remaining loans, S&P expects losses on the Booker loan in
its base case scenario.

                           RATING ACTIONS

S&P's ratings on HERCULES (ECLIPSE 2006-4)'s notes address the
timely payment of interest and repayment of principal not later
than the legal maturity date (October 2018).

S&P considers the available credit enhancement to be insufficient
to absorb calculated losses under its stress scenarios at the
notes' currently assigned rating levels.  S&P has therefore
lowered and removed from CreditWatch negative its ratings on the
class A, B, C, and D notes.

S&P has also affirmed its rating on the class E notes as it
believes that its rating on this class is commensurate with the
refinance risk and leverage for these notes.  S&P expects this
class of notes to experience principal losses, but not in the
near term.

HERCULES (ECLIPSE 2006-4) is a true sale transaction that closed
in December 2006 and was backed by a pool of seven loans secured
against U.K. commercial properties.  None of the loans have fully
prepaid since closing and the outstanding note balance is
GBP780.74 million (down from GBP814.95 million at closing).


SEC Rule 17g-7 requires an NRSRO, for any report accompanying a
credit rating relating to an property-backed security as defined
in the Rule, to include a description of the representations,
warranties and enforcement mechanisms available to investors and
a description of how they differ from the representations,
warranties and enforcement mechanisms in issuances of similar
securities.  The Rule applies to in-scope securities initially
rated (including preliminary ratings) on or after Sept. 26, 2011.

If applicable, the Standard & Poor's 17g-7 Disclosure Report
included in this credit rating report is available at:



Class                   Rating
               To                 From

GBP814.95 Million Commercial Mortgage-Backed Floating-Rate Notes

Ratings Lowered and Removed From CreditWatch Negative

A              BB (sf)           A- (sf)/Watch Neg
B              BB- (sf)          BBB (sf)/Watch Neg
C              B+ (sf)           BBB- (sf)/Watch Neg
D              B- (sf)           BB- (sf)/Watch Neg

Rating Affirmed

E              B- (sf)

HIBU PLC: Plans Debt Restructuring
Emily Glazer at Daily Bankruptcy Review reports that as yellow-
page companies struggle, U.K.-based Hibu PLC is aiming to
complete an out-of-court financial restructuring by summer,
according to people familiar with its plans.

PENDRAGON PLC: Moody's Assigns 'B2 Corp. Rating; Outlook Stable
Moody's Investors Service assigned a B2 corporate family rating
and a B2-PD probability of default rating  to Pendragon PLC, a
leading automotive retailer by revenues in the UK, with around
240 franchises. Concurrently Moody's has assigned a (P)B2 rating
and loss given default assessment of LGD3 to the group's
GBP175million senior secured notes due 2020. The outlook on all
ratings is stable.

"Moody's has assigned a B2 CFR, B2-PD PDR and (P)B2 instrument
rating to support Pendragon's proposed GBP320million debt package
which will be used to refinance its existing debt obligations"
says Andreas Rands, a Moody's Vice President - Senior Analyst and
lead analyst for Pendragon.

In this regard, the company is seeking to raise GBP175 million of
senior secured notes due 2020, which Moody's has rated (P)B2 and
a GBP145 million revolving credit facility, which is not rated.

The stable outlook builds in an expectation of improved credit
metrics over the next 12 months driven by the current attractive
fundamentals of the new car sales market in the UK, which is
likely to support growth in the core aftersales segment in the
near term.

Moody's issues provisional ratings in advance of the final sale
of securities and these ratings reflect Moody's preliminary
credit opinion regarding the transaction only. Upon a conclusive
review of the final documentation, Moody's will endeavor to
assign a definitive rating to the notes and revolving credit
facility. A definitive rating may differ from a provisional

Ratings Rationale:

Pendragon's B2 rating is constrained by (1) the cyclical nature
of new and used car sales (representing 56% of the company's
gross profit in fiscal 2012); (2) the linkage between new car
sales and the aftersales segment, the key profit generator for
the company; and (3) the company's principal focus on the UK
market, which leaves it exposed to the challenging macroeconomic
outlook in the country. In addition, Moody's-adjusted leverage
pro-forma for the proposed refinance still remains high at around
6.4x as at fiscal 2013. However, these factors are partially
offset by the company's improved credit metrics over the last
three financial years, especially debt/EBITDA, as well as its
leading market position in the very fragmented UK auto retailing
market. Furthermore, the rating also incorporates the company's
favorable brand mix, with its key premium and volume-led brands
(Stratstone and Evans Halshaw, respectively) generating similar
reported underlying operating profit in fiscal 2012. The rating
is further supported by Pendragon's parts and service offering
(accounting for around 40% of group gross profit), which is
driven by the stability of the overall UK car parc and the
apparent stabilization in the 'less than three years old' car
segment, which is the company's core focus.

A significant portion of the company's reported financial
liabilities, as per its 2012 Annual Report, are to finance new
and used car stock (GBP409.2 million OEM finance (mainly new
cars) and GBP122.3 million third-party stock finance (mainly used
cars)). This was relative to core operational funding of GBP214.9
million of bank debt and GBP1.5 million of finance leases. The
stock finance is with a variety of third-party finance companies
and the OEM finance is with OEM's finance arms.

The (P)B2 instrument rating for the proposed senior secured notes
due 2020 is in line with the Corporate Family Rating of B2. All
proposed senior secured debt facilities rank pari passu and share
the same security and guarantee package. The guarantors will
initially account for at least 80% of group gross assets,
turnover and pre-tax profits, but this will increase to 90% by 31
December 2013 at the latest. The proposed RCF has (1) a leverage
covenant of 2.75x, stepping down to 1.75x by December 2016; and
(2) an interest coverage covenant of 1.6x, stepping up to 1.7x by
June 2016. Covenants are not tested until December 2013. The bond
will have incurrence covenants. Moody's expects that Pendragon
will maintain ample covenant headroom on an ongoing basis.

Pro-forma for the refinancing, Moody's considers Pendragon's
liquidity profile to be adequate. The company's cash on the
balance sheet amounted to around GBP58 million as at 31 December
2012. As well as generating positive reported free cash flow of
around GBP15-25 million per annum, Moody's expects that Pendragon
will have significant availability under its proposed GBP145
million committed RCF maturing in 2017 for seasonal working
capital needs, with adequate headroom under the facility's
proposed financial covenants at all times.


The stable outlook on the rating reflects Moody's belief that
Pendragon's favorable brand mix will continue to resonate with
consumers, and that the company will continue to prudently manage
its expenses, resulting in credit metrics that Moody's expects
will continue to improve over the next 12 months. This
expectation of improved credit metrics is driven by the current
attractive fundamentals of the new car sales market in the UK,
which is likely to support growth in the core aftersales segment
in the near term.

What Could Change The Rating Up/Down

Although not expected in the short term, positive rating pressure
could result if Pendragon continues to improve its operating
performance and credit metrics, as well as maintain a balanced
financial policy. Quantitatively, Moody's could upgrade the
rating if adjusted debt/EBITDA was sustained below 5.5x and
adjusted EBIT/interest was sustained above 1.75x.

Conversely, negative rating pressure could arise if Pendragon's
liquidity or operating performance were to weaken, or if the
company were to undertake an aggressive financial policy such
that adjusted debt/EBITDA remained above 6.5x or if adjusted
EBIT/interest was maintained below 1.5x.

The principal methodology used in this rating was the Global
Automotive Retailer Industry published in December 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.

Pendragon PLC, headquartered in Nottingham, England, is the UK's
leading automotive retailer by revenues, according to the
company, with around 240 franchises, and posted revenues of
GBP3.6 billion in fiscal 2012.

* UK: Unveils Proposal to Help Struggling Pub Tenants
Martin Strydom at The Telegraph reports that the UK government
has proposed a code of practice and a "powerful adjudicator" to
help pub tenants struggling to pay rent or beer prices.

According to the Telegraph, Vince Cable, the Business Secretary,
said the changes could save landlords GBP100 million a year by
making sure that pub companies charge their tenants fair rents
and beer prices.

The code will apply to companies owning more than 500 pubs, the
Telegraph discloses.  It aims to stop abuses of the beer tie,
under which a landlord had to buy beer from the company which
owns the pub, the Telegraph says.

Under the code, pubs must be fairly and lawfully treated by pub
companies; tied pubs must be no worse off than free-of-tie pubs,
and pub companies must charge fair rents and beer prices -- with
the possibility of open market rent reviews, the Telegraph

Mr. Cable, as cited by the Telegraph, said: "We gave pub
companies every chance to get their house in order.  But despite
four select committee reports over almost a decade highlighting
the problems faced by publicans, it is clear the voluntary
approach isn't working.

"Pubs are small businesses under a great deal of pressure, many
of which have had to close.  Much of that pressure has come from
the powerful pub companies and our plans are designed to
rebalance this relationship."

"Pubs play a valuable role at the heart of our communities and we
urgently need a change to help them survive and become
profitable.  These plans will do just that."

* UK: Number of Scottish Business Failures Down 63% in Q12013
Dominic Jeff at The Scotsman reports that the number of Scottish
companies going bust plunged in the first three months of the
year and the numbers on the "critical list" halved as creditors
and the taxman changed tack by cutting firms some slack.

According to the Scotsman, official figures from Scotland's
insolvency service, Accountant in Bankruptcy, show 143 firms went
under during the three months to March -- down 63% year-on-year.

Separate figures from accountant Begbies Traynor revealed the
number of companies in "critical distress" halved north of the
Border, a bigger fall than that seen across the UK as a whole,
the Scotsman notes.

"The largest influencers on the levels of critical business
distress are creditor forbearance, access to funding and HMRC
actions, and these have changed over recent years.

"Put simply, when creditors are more patient, the levels of
distress tend to fall.  This is undoubtedly a factor in the
economy at the moment, but is countered to a degree by a climate
where business funding is less available than was the case a few
years ago," the Scotsman quotes Ken Pattullo, the group's
managing partner in Scotland, as saying.

But Bryan Jackson, a business restructuring partner with
accountant BDO, said the drop in insolvencies does not
necessarily indicate a wider recovery, the Scotsman notes.

"This could be good news or simply a sign that demand for
bankruptcy has dried up," Mr. Jackson, as cited by the Scotsman,

* UK: Fitch Says Pub Proposal May Pressure Profits
The implementation of a statutory code to protect the tenants of
large UK pub companies from perceived unfair treatment would
probably be negative for major tenanted pubcos' profitability in
the short to medium term, Fitch Ratings says. But the size of the
impact on the sector remains unclear, while over the longer term
proposed aspects of the code could help stabilize pubco cash
flows as more affordable rents could reduce tenant failure rates.

Fitch says: "We estimate the potential reduction in EBITDA of the
major pubco securitizations could be 6%-8% for fully
tenanted/leased pubcos (Punch Taverns and Enterprise Inns) and
2%-5% for mixed tenanted/managed pubcos (Greene King, Spirit, and
Marston's), if the government's assumptions are borne out. The
government estimates a cost impact of GBP102 million per year for
the pubcos, mainly as a result of profits being transferred to
tenants. If this is correct, the average yearly cost increase per
tenanted tied pub would be about GBP4,250 under the government's
median case.

"We expect the average impact on current debt service coverage
ratios in the affected securitized pub transactions to be low,
from 0.1x for pure tenanted companies to around 0.05x for the
tenanted/managed operators.

"However, we expect various factors to offset the cost impact to
some extent. Major pubcos already claim to be partially or fully
compliant with Royal Institute of Chartered Surveyors guidance on
rent reviews under the self-regulatory code of practice. If so,
the transfer of profits from the pubcos to the tenants might
prove less than anticipated.

"Pubcos have already been reducing rents since the financial
crisis and economic downturn took hold in 2008. So some of the
necessary rent reductions -- up to 30% in certain cases -- may
have already taken place. In addition, while the government has
taken a significant step towards establishing a statutory code
with the release of its consultation, it remains at the planning
stage and the impact on profitability could differ from current

"We remain more concerned about broader pressures on the sector
such as off-trade competition, reduced alcohol consumption,
protracted macroeconomic weakness putting pressure on
discretionary spending and socio-demographic changes that have
reduced demand for traditional wet-led pubs in the UK. Overall
the industry outlook remains negative, with most of the Fitch-
rated whole business securitization debt tranches on Negative

In a consultation paper released on Monday, the UK government
proposed to replace self-regulation of the relationship between
large pubcos and their tenants with legislation. The proposed
code would apply to pubcos with over 500 pubs, which would
include major operators such as Enterprise Inns, Punch Taverns,
Greene King, Marston's and Spirit (whose WBS debt issuances are
rated by Fitch).


* BOOK REVIEW: The Luckiest Guy in the World
Author: Boone Pickens
Publisher: Beard Books
Paperback: US$34.95
Review by Gail Owens Hoelscher
Buy a copy for yourself and one for a colleague on-line at:

"This is the story of a man who turned a $2,500 investment into
America's largest independent oil company in thirty years and
along the way discovered that something is terribly wrong with
corporate America. Mesa Petroleum is the company, and I'm the
man." Thus begins the autobiography of Boone Pickens, who
prefers to be referred to without his first initial, "T."

Mr. Pickens' autobiography was originally published in 1987, at
the end of the rollercoaster years when he was one of the most
245 famous (or infamous, depending on your point of view) and
mostfeared corporate raiders during a decade known for corporate
raiding. For the 2000 Beard Books edition, Pickens wrote an
additional five chapters about the subsequent, equally
tumultuous, 13 years, during which time he suffered corporate
raiders of his own, recapitalized, and retired, only to see his
beloved company merge with Pioneer. One of his few laments is
being remembered mainly for the high-profile years, rather than
for the company he built from virtually nothing.

Of the takeover attempts, he says: "I saw undervalued assets in
the public marketplace. My game plan with Gul, Phillips, and
Unocal wasn't to take on Big Oil. Hell, that wasn't my role. My
role was to make money for the stockholders of Mesa. I just saw
that Big Oil's management had done a lousy job for their

He would prefer to be known as a champion of the shareholder
rights movement, which prompted big corporations to become more
responsive to the needs and demands of their stockholders. He
founded the United Shareholders Association, a group that
successfully lobbied for changes in corporate governance. In a
memorable interview in the May/June 1986 Harvard Business
Review, Pickens said, "Cheif executives, who themselves own few
shares of their companies, have no more feeling for the average
stockholder than they do for baboons in Africa."

Boone Pickens was born in 1928 in Holdenville, Oklahoma. His
grandfather was Methodist missionary to the Indians there; his
father was a lawyer and small player in the oil business.
People in Holdenville worked hard and used such expressions as
"Root hog or die," meaning "Get in and compete or fail."
The family later moved to Amarillo, Texas, where Pickens went to
Texas A&M for one year, but graduated from Oklahoma State
University in 1951 with a degree in geology. He worked at
Phillips Petroleum for three years, and then, despite growing
family obligations, struck out on his own. His wife's uncle
told him, "Boone, you don't have a chance. You don't know

This book is a wonderful read. Pickens pulls no punches, and is
as hard on himself as anyone else. He talks about proxy fights,
Texas-Oklahoma football games, his three marriages, poker,
takeover strategies, and unfair duck hunting practices, all in
the same easy tone. You feel like he's sitting right there in
the room with you.

Pickens ends the introduction to this story with this:
"How I got from a little town in Eastern Oklahoma to the towers
of Wall Street is an exciting, unlikely, sometimes painful
story. And, if you're young and restless, I'm hoping you'll
make a journey similar to mine."

Root hog or die!


Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par.  Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable.  Those sources may not,
however, be complete or accurate.  The Monday Bond Pricing table
is compiled on the Friday prior to publication.  Prices reported
are not intended to reflect actual trades.  Prices for actual
trades are probably different.  Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind.  It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.

Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than US$3 per
share in public markets.  At first glance, this list may look
like the definitive compilation of stocks that are ideal to sell
short.  Don't be fooled.  Assets, for example, reported at
historical cost net of depreciation may understate the true value
of a firm's assets.  A company may establish reserves on its
balance sheet for liabilities that may never materialize.  The
prices at which equity securities trade in public market are
determined by more than a balance sheet solvency test.

A list of Meetings, Conferences and Seminars appears in each
Thursday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged.  Send announcements to

Each Friday's edition of the TCR includes a review about a book
of interest to troubled company professionals.  All titles are
available at your local bookstore or through  Go to order any title today.


S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter-Europe is a daily newsletter co-
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Valerie U. Pascual, Marites O. Claro, Rousel Elaine T. Fernandez,
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A. Chapman, Editors.

Copyright 2013.  All rights reserved.  ISSN 1529-2754.

This material is copyrighted and any commercial use, resale or
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