TCREUR_Public/130612.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

            Wednesday, June 12, 2013, Vol. 14, No. 115



DONG ENERGY: S&P Assigns 'BB+' Rating to Capital Securities


VIRGIN MEGASTORE: Paris Court to Decide on Future on June 17


SAPPI PAPIER: S&P Affirms 'BB-' LT Corp. Credit Rating
SGL CARBON: Moody's Revises Outlook on 'Ba2' CFR to Negative


ALLIED IRISH: Acting CFO Paul Stanley Quits
* IRELAND: Fitch Says Significant Risks Remain in Banking System
CORDUSIO RMBS 2007: Moody's Lowers Rating on Cl. E Notes to Caa1


ICENTRE: Applies for Court Protection From Creditors


ONT CARPATI: Liquidator Fails to Sell 35% Societatea Stake


EXILLON ENERGY: S&P Withdraws Preliminary 'B' Corp. Credit Rating


AVANZA SPAIN: Moody's Assigns 'B1' Rating to Sr. Secured Bonds
* SPAIN: SAREB Sales Underscores Property Market Weakness


SAAB AUTOMOBILE: Judge Dismisses Spyker Suit v. GM Over Sale


* UKRAINE: Simplifies Company Bankruptcy Procedures

U N I T E D   K I N G D O M

CAITHNESS STONE: Severe Cash Flow Problems Prompt Administration
COLLBIO: Gets More Than GBP250,000 Funding to Relaunch Business
GODFREY DIY: Closes Two Remaining DIY Stores in Diss & Stowmarket
IDH FINANCE: Moody's Assigns B2 Ratings to GBP325MM Notes
INTERNATIONAL OPERA: Placed Into Liquidation

MEDIAGROUND LTD: Goes Into Administration
PUNCH TAVERNS: Restructuring Plan Fails to Win Investor Backing


* EUROPE: Moody's Says Outlook for Steel Industry to Remain Neg.
* Fitch Sees Modest Deterioration in Asset Quality for EM Banks



DONG ENERGY: S&P Assigns 'BB+' Rating to Capital Securities
Standard & Poor's Ratings Services assigned its 'BB+' long-term
issue rating to the proposed two tranches of long-dated,
optionally deferrable, and subordinated hybrid capital securities
of the same series to be issued by Danish integrated power and
gas company utility DONG Energy A/S (BBB+/Negative/A-2).  The
company will use the new securities to exchange and refinance the
existing EUR700 million hybrid securities due 3010.  The
transaction volume is subject to acceptance of the exchange
tender and market conditions.

The issuance of the new securities does not affect S&P's view of
the "intermediate" equity content of DONG Energy's existing
EUR1.1 billion hybrid securities due 3005, of which about
EUR600 million is outstanding.

S&P considers the proposed securities to have "intermediate"
equity content until their first call date in 2023 because they
meet its hybrid capital criteria in terms of their subordination,
permanence, and optional deferability during this period.

S&P arrives at its 'BB+' issue rating on the proposed securities
by notching down from its 'bbb' stand-alone credit profile (SACP)
on DONG Energy.  The two-notch differential between the issue
rating and the SACP reflects S&P's notching methodology, which
calls for:

   -- A one-notch deduction for subordination because the rating
      on DONG Energy is investment-grade (that is, 'BBB-' or
      above); and

   -- An additional one-notch deduction for payment flexibility
      to reflect that the deferral of interest is optional.

The notching of the proposed securities reflects S&P's view that
there is a relatively low likelihood that the issuer will defer
interest.  Should S&P's view changes, it may increase the number
of downward notches that it applies to the issue rating.

In addition, to reflect S&P's views of the intermediate equity
content of the proposed securities, it allocates 50% of the
related payments on these securities as a fixed charge and 50% as
equivalent to a common dividend, in line with S&P's hybrid
capital criteria.  The 50% treatment of principal and accrued
interest also applies to S&P's adjustment of debt.


Although the proposed securities would mature in 3013, they can
be called at any time for tax, rating, or accounting events.
Furthermore, the issuer can redeem them for cash as of their
first call date, and every five years thereafter.  If any of
these events occurs, S&P understands the issuer intends, but is
not obliged, to replace the securities.  In S&P's view, this
statement of intent mitigates the issuer's ability to repurchase
the notes on the open market.  Furthermore, S&P sees the
repurchase as unlikely owing to DONG Energy's commitment to

S&P understands that the interest to be paid on the proposed
securities will increase by 25 basis points 10 years from
issuance, and by a further 75 basis points 20 years after the
first call date.  S&P considers the cumulative 100 basis points
as a material step-up, which is currently unmitigated by any
commitment to replace the instrument at that time.  This step-up
provides an incentive for the issuer to redeem the securities on
their first call date.

Consequently, in accordance with S&P's criteria, it will no
longer recognize the securities as having intermediate equity
content after the first call date, because the remaining period
until the economic maturity would, by then, be less than 20
years.  However, S&P classifies the securities' equity content as
intermediate until its first call date, as long as it believes
that the loss of the beneficial intermediate equity content
treatment will not cause the issuer to call the securities at
that point.  The issuer's willingness to maintain or replace the
securities in the event of a reclassification of equity content
to minimal is underpinned by its statement of intent.


In S&P's view, the issuer's option to defer payment on the
proposed securities is discretionary.  This means that the issuer
may elect not to pay accrued interest on an interest payment date
because it has no obligation to do so.  However, any outstanding
deferred interest payment will have to be settled in cash if DONG
Energy declares or pays an equity dividend or interest on equally
ranking securities, or if DONG Energy or its subsidiaries redeem
or repurchase shares or equally ranking securities.  S&P sees
this as a negative factor.  That said, this condition remains
acceptable under S&P's methodology because once the issuer has
settled the deferred amount, it can still choose to defer on the
next interest payment date.

The issuer retains the option to defer coupons throughout the
life of the securities.  The deferred interest on the proposed
securities is cash cumulative, and will ultimately be settled in


The proposed securities (and coupons) are intended to constitute
direct, unsecured, and subordinated obligations of the issuer,
ranking senior to its common shares.  They rank pari passu with
the existing hybrid securities due 3005.

New Rating

DONG Energy A/S
Junior Subordinated                    BB+


VIRGIN MEGASTORE: Paris Court to Decide on Future on June 17
The Bookseller reports that Virgin Megastore will almost
certainly go into liquidation next week.

The Paris commercial court on June 10 rejected the two remaining
bids to take over some outlets and will meet next Monday,
June 17, to decide on the next step for the 26-store group, the
Bookseller relates.

The last two of the five initial bids were from the Cultura chain
of stores and ready-to-wear and shoe chain Vivarte, both of which
got the thumbs down from the unions, the Bookseller discloses.
The best hope had been the art supplies group Rougier et Pie,
which promised to keep the brand by acquiring the license for 11
of the 26 stores and saving 285 of the group's 960 jobs, but it
pulled out in mid-May, the Bookseller recounts.

Virgin Megastore, which filed for bankruptcy in January, was
founded in France in 1988 by Richard Branson with Patrick
Zelnick, c.e.o. of music publisher Naive, at the helm, according
to the Bookseller.  The Lagardere group bought the chain in 2001
and sold 74% of its stake to French private equity firm Butler
Capital Partners in 2008, the Bookseller relates.

Like Fnac, the leading French cultural product chain, Virgin has
suffered from a sharp drop in sales of CDs and DVDs as Amazon and
the rise of competing e-tailers, the Bookseller notes.

Virgin Megastore is a French books, music and movies chain.


SAPPI PAPIER: S&P Affirms 'BB-' LT Corp. Credit Rating
Standard & Poor's Ratings Services said that it revised its
outlook on South Africa-based forest products group Sappi Ltd. to
negative from stable.  At the same time, S&P affirmed its 'BB-'
long-term corporate credit rating on the group.

In addition, S&P affirmed its 'BB' issue ratings on the various
rated senior secured debt instruments issued by Sappi's 100%-
owned and guaranteed subsidiary Sappi Papier Holding GmbH (Sappi
Papier).  The recovery rating on the senior secured debt is
unchanged at '2', indicating S&P's expectation of substantial
(70%-90%) recovery for creditors in the event of a payment

Finally, S&P affirmed its 'B' issue rating on Sappi Papier's
$250 million senior unsecured notes.  The recovery rating on the
senior unsecured debt is unchanged at '6', indicating S&P's
expectation of negligible (0%-10%) recovery in the event of a
payment default.

The outlook revision reflects S&P's view that Sappi's results for
the second quarter of the financial year ending Sept. 30, 2013
(financial 2013), were weaker than S&P forecasts.  This was due
to challenging trading conditions in Europe and South Africa, and
the group's heavy use of cash, because it invested in the
conversion of two of its existing mills to produce chemical

In S&P's view, there is a risk that Sappi could experience weaker
market conditions in Europe and South Africa than it currently
forecasts in full-year 2013, which could place negative pressure
on the group's credit metrics.  The outlook revision also
reflects S&P's view that there may be some operational risk
associated with the start-up of the two chemical cellulose mills
at Cloquet in the U.S. and at Ngodwana in South Africa.

Once the new mills are up to optimum capacity and capital
expenditure (capex) returns to normal levels, S&P believes that
the group's credit metrics should recover to levels it views as
firmly commensurate with a 'BB-' rating in financial 2014.
However, Sappi's credit metrics could weaken to levels below
those S&P views as commensurate with a 'BB-' rating if trading
conditions are weaker than it currently assumes in its base case,
or if there are any delays relating to the start-up of the two
newly converted mills.

To reflect the weakening in Sappi's results, S&P has lowered its
forecast of the group's adjusted EBITDA margin for financial 2013
to just less than 10% from just less than 12% on Dec. 31, 2012.
S&P projects that funds from operations (FFO) to debt will
decline to slightly more than 13% in 2013, and improve to about
20% in 2014.  S&P also incorporates into its forecasts its
understanding that management will turn its attention to debt
reduction as soon as this year's major capex projects are

Despite good progress on the conversion of two major chemical
cellulose mills, S&P considers that weaker market conditions than
it anticipates or start-up delays relating to the conversions
could weaken Sappi's credit metrics to levels below those S&P
considers commensurate with a 'BB-' rating.

S&P could downgrade Sappi if the group's FFO to debt were to fall
to less than 15%, or if adjusted debt to EBITDA were to rise to
more than 4.5x, and remain there on a sustained basis with few
indications of a swift reversal.

S&P could revise the outlook to stable if Sappi generates FFO to
debt of more than 15% or adjusted debt to EBITDA of less than
4.5x, provided that near- to medium-term macroeconomic and
industry conditions support S&P's view that Sappi could sustain
such improved levels.

SGL CARBON: Moody's Revises Outlook on 'Ba2' CFR to Negative
Moody's Investors Service has changed to negative from stable the
outlook on the Ba2 corporate family rating (CFR) and the Ba2-PD
probability of default rating (PDR) of SGL Carbon SE (SGL
Carbon), as well as on the Ba1 rating on the company's existing
EUR200 million of senior floating-rate notes due 2015.
Concurrently, Moody's has affirmed these ratings.

"We have changed the outlook on SGL Carbon's Ba2 ratings to
negative from stable to reflect the manufacturer's weakened
operating performance over the past 12 months, and our revised
expectation that, due to an anticipated ongoing cyclical decline
in the company's end markets, it will not be able to maintain
appropriate profitability levels and credit protections for the
Ba2 rating," says Anthony Hill, a Moody's Vice President --
Senior Analyst and lead analyst for SGL Carbon.

Ratings Rationale:

The rating action reflects SGL Carbon's waning performance to
date and Moody's expectation of an ongoing cyclical decline in
the company's end markets within the steel, chemical, automotive,
solar, semiconductor, and LED (light-emitting diode) industries.
Moody's expects this decline to be particularly notable in
Europe, where SGL Carbon generated approximately 41% of its
financial year-end 2012.

At financial year end (FYE) December 31, 2011, SGL Carbon's
EBITDA margin, retained cash flow (RCF)/net debt ratio, and net
debt/EBITDA ratio were 17.2%, 26%, and 3.1x, respectively. As of
the last-12-months ending March 31, 2013, each of these credit
metrics had deteriorated to 10.4%, 10%, and 5.6x, respectively
(all figures are on a Moody's-adjusted basis).

A main driver of the decline in these metrics was SGL Carbon's
reported EUR32.5 million revenue write-down in FYE 2012
associated with reductions in, and delays of, the company's long-
term construction contracts to supply carbon fibre components for
the Boeing 787 (Dreamliner).

However, Moody's notes that profitability in SGL Carbon's
graphite materials and systems division, which represents nearly
30% of the company's FYE 2012 sales, has been in cyclical
decline. This division reported a 13% year-on-year decline in
EBITDA in FYE 2012 versus FYE 2011, and a 65.5% decline in EBITDA
for the first quarter ending March 31, 2013 versus the same
period in the previous year. Moody's believes the declines in
this division are primarily due an ongoing downturn in demand for
SGL Carbon's graphite-based products and technologies from the
cyclically challenged global chemical, automotive, solar,
semiconductor, and LED industries. Moody's expects this demand to
remain flat for the next 12 months globally, and to be in modest
decline over the same period in Europe.

Furthermore, Moody's expectation for SGL Carbon's performance
products division, which represents 55% of the company's FYE 2012
sales, is negative. Primarily, this division sells graphite
electrodes to the steel industry, which is SGL Carbon's core
business. The market for graphite electrodes, particularly in
Europe and North America, continues to grow only in line with the
steel industry and overall economic growth. Moody's notes that
global steel demand growth nearly stalled in 2012 and fell by 9%
in Europe. Furthermore, while the rating agency expects global
steel demand to grow by 2%-3% in 2013; this will be from a low
base. Therefore, Moody's expects conditions to remain challenging
in all steel markets, especially in Europe, where the rating
agency forecasts that steel demand will fall by 2%-4%.

Moody's believes that SGL Carbon's liquidity will comfortably
cover its near-term requirements. The rating agency expects the
company to exhibit an adjusted cash balance of approximately
EUR185 million at FYE 2013. Internally generated cash flow and
the currently undrawn EUR200 million revolving credit facility
should readily cover the company's ongoing basic cash needs, such
as debt service and amortization, working capital needs and
expected capital expenditures.

Using Moody's Loss Given Default (LGD) methodology, the PDR is
equal to the CFR. This is based on a 50% recovery rate, as is
typical for a debt capital structure that primarily consists of
senior notes. SGL Carbon's senior floating-rate notes are rated
one notch higher than the CFR due to the subordination created by
the unsecured convertible notes present in the company's debt
capital structure.

What Could Change The Rating Up/Down

Moody's does not expect any upward pressure on the rating over
the coming quarters. However, it could stabilize the rating
outlook if SGL Carbon were to (1) solidly, and consistently,
generate positive free cash flow (FCF); (2) sustain RCF/net debt
in the high teens in percentage terms; and (3) achieve and
maintain a Moody's-adjusted debt/EBITDA ratio at around 4.0x.

Conversely, Moody's would likely downgrade SGL Carbon if, over
the coming quarters, a further deterioration in the company's
operating performance were to result in the following, on a
Moody's-adjusted and sustained basis: (1) negative free cash flow
generation; (2) RCF/net debt in the mid- to low teens in
percentage terms; and/or (3) a net debt/EBITDA ratio above 5.0x.

Principal Methodology

The principal methodology used in this rating was the Global
Chemical Industry rating methodology, 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.

Headquartered in Wiesbaden, Germany, SGL Carbon SE is one of the
world's leading manufacturers of carbon- and graphite-based
products. SGL generated revenues of EUR1.7 billion and Moody's-
adjusted EBITDA of EUR202 million for FYE 2012.


ALLIED IRISH: Acting CFO Paul Stanley Quits
Paul Stanley, acting chief financial officer, has informed the
Bank that he is to leave Allied Irish Bank to pursue other
opportunities with effect from August 2013.

Mr. Stanley joined AIB in 1980 and was appointed Acting Chief
Financial Officer in May 2011.  AIB CEO David Duffy said: "I
would like to thank Paul for his commitment to AIB over many
years and for the valuable role he played as Acting Chief
Financial Officer in helping to stabilise the bank in such a
challenging period in the company's history."

AIB has commenced a process of identifying a permanent Chief
Financial Officer and expects this process to conclude in the
short term subject to relevant regulatory approvals.

                       About Allied Irish Banks

Allied Irish Banks, p.l.c. -- is a
major commercial bank based in Ireland.  It has an extensive
branch network across the country, a head office in Dublin and a
capital markets operation based in the International Financial
Services Centre in Dublin.  AIB also has retail and corporate
businesses in the UK, offices in Europe and a subsidiary company
in the Isle of Man and Jersey (Channel Islands).

Since the onset of the global and Irish financial crisis, AIB's
relationship with the Irish Government has changed significantly.

As at Dec. 31, 2010, the Government, through the National Pension
Reserve Fund Commission ("NPRFC"), held 49.9% of the ordinary
shares of the Company (the share of the voting rights at
shareholders' general meetings), 10,489,899,564 convertible non-
voting ("CNV") shares and 3.5 billion 2009 Preference Shares.  On
April 8, 2011, the NPRFC converted the total outstanding amount
of CNV shares into 10,489,899,564 ordinary shares of AIB, thereby
increasing its holding to 92.8% of the ordinary share capital.

In addition to its shareholders' interests, the Government's
relationship with AIB is reflected through formal and informal
oversight by the Minister and the Department of Finance and the
Central Bank of Ireland, representation on the Board of Directors
(three non-executive directors are Government nominees),
participation in NAMA, and otherwise.

The Company reported a loss of EUR2.29 billion in 2011, a loss of
EUR10.16 billion in 2010, and a loss of EUR2.33 billion in 2009.

Allied Irish's consolidated statement of financial position for
the year ended Dec. 31, 2011, showed EUR136.65 billion in total
assets, EUR122.18 billion in total liabilities and EUR14.46
billion in shareholders' equity.

Allied Irish's balance sheet at June 30, 2012, showed EUR129.85
billion in total assets, EUR116.59 billion in total liabilities
and EUR13.26 billion in total shareholders' equity.

* IRELAND: Fitch Says Significant Risks Remain in Banking System
Fitch Ratings says in a newly-published special report that the
Irish banks' Viability Ratings are constrained by the significant
risks that remain in the Irish banking system. However, support
remains an important rating driver and Fitch considers that the
Irish authorities' propensity to support the 'pillar' banks, Bank
of Ireland (BOI) and Allied Irish Banks, p.l.c. (AIB) remains
undiminished, despite the withdrawal of the Irish Bank Eligible
Liabilities Guarantee (ELG) in March 2013.

Fitch believes that the pillar banks' performance will continue
to track within the stress case scenario of the 2011 Prudential
Capital Assessment Reviews (PCAR), however these tests were
framed on a Basel II basis. Since then capital expectations of
market participants have increased. The 2014 PCAR may revise the
stress assumptions and requirements to align more closely with
Basel III.

"As Irish banks' capital ratios continue to be eroded and a
return to profitability only appears feasible in the longer term,
the banks may need to raise additional capital before they can
contemplate a future independent of state support", says Denzil
De Bie, a Director in Fitch's Financial Institutions Group.

Irish banks' asset quality remains weak, with high NPLs and
impairment charges, especially against commercial real estate and
residential mortgage loans. Although the rate of deterioration
slowed at BOI and AIB in 2012, Fitch believes impairment charges
could increase during 2013 and 2014, with arrears reaching a peak
in 2014, as the banks accelerate the resolution of mortgage
arrears in line with new targets set by the Central Bank of
Ireland in March 2013.

Underlying pre-provision operating profitability is structurally
very weak because of the long-term, very low-yielding mortgage
loans in their books. Until rates rise, Fitch considers that a
return to sustainability will only be possible as the various
restructuring and cost control plans of the banks begin to yield
results. Fitch expects a return to operating profitability to be
delayed until at least 2015 because of the continued erosion of
earnings from high but reducing impairment charges.

The report, entitled "Peer Review: Irish Banks" is available at or by clicking the link above.

CORDUSIO RMBS 2007: Moody's Lowers Rating on Cl. E Notes to Caa1
Moody's Investors Service has downgraded the ratings of ten
junior and mezzanine notes in four Italian residential mortgage-
backed securities (RMBS) transactions: Cordusio RMBS S.r.l.,
Cordusio RMBS - UCFin S.r.l., Cordusio RMBS Securitization S.r.l.
- Series 2006 and Cordusio RMBS Securitization S.r.l. - Series
2007. At the same time, Moody's confirmed the rating of one
senior note in Cordusio RMBS Securitization S.r.l. - Series 2007.
Insufficiency of credit enhancement to address sovereign risk,
counterparty exposure and revision of key collateral assumptions
have prompted the downgrade.

The rating action concludes the review of seven notes placed on
review on August 2, 2012, following Moody's downgrade of Italian
government bond ratings to Baa2 from A3 on July 13, 2012. This
rating action also concludes the review of Class C notes in
Cordusio RMBS S.r.l., placed on review on 22 May 2012, following
Moody's downgrade of UniCredit SpA from A2 to A3 on 14 May 2012.
This rating action also concludes the review of Class A notes in
Cordusio RMBS Securitization S.r.l. - Series 2007, placed on
review on 13 Mar 2013, due to the insufficiency of credit
enhancement to address sovereign risk following the introduction
of additional factors in Moody's analysis to better measure the
impact of sovereign risk on structured finance transactions. This
rating action also concludes the review of Class D and E notes in
Cordusio RMBS S.r.l., placed on review on November 27, 2012,
following Moody's review of collateral assumptions for the entire
Italian RMBS market.

Ratings Rationale:

The rating action primarily reflects the insufficiency of credit
enhancement to address sovereign risk, counterparty exposure and
revision of key collateral assumptions. Moody's confirmed the
ratings of securities 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 Italian country ceiling, and therefore the maximum rating
that Moody's will assign to a domestic Italian issuer including
structured finance transactions backed by Italian receivables, is
A2. 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.

- Revision of Key Collateral Assumptions

Moody's has revised its lifetime loss expectation (EL) assumption
in Cordusio RMBS - UCFin S.r.l., Cordusio RMBS Securitization
S.r.l. - Series 2006 and Cordusio RMBS Securitization S.r.l. -
Series 2007 because of worse-than-expected collateral performance
since the last review of the Italian RMBS sector in November

In Cordusio RMBS - UCFin S.r.l., the share of 90d+ arrears
currently stands at 1.9% of current pool balance, up from 1.4% as
of the previous review while cumulative defaults increased from
3.5% of the original pool balance to 3.8%. In Cordusio RMBS
Securitization S.r.l. - Series 2006 the share of 90d+ arrears
currently stands at 1.3% of current pool balance, up from 1.0% as
of the previous review while cumulative defaults increased from
1.3% of the original pool balance to 1.5%. In Cordusio RMBS
Securitization S.r.l. - Series 2007 the share of 90d+ arrears
currently stands at 1.7% of current pool balance, up from 1.5% as
of the previous review while cumulative defaults increased from
2.7% of the original pool balance to 3.1%. Moody's have updated
the EL assumption in these three deals to 3.5%, 1.7% and 3.0% of
original pool balance respectively. Moody's has maintained its EL
assumptions at 0.5% of the original pool balance in Cordusio RMBS

During its review, Moody's also reassessed the MILAN CE
assumptions of the transactions underlying portfolios based on
available loan-by-loan information. As a result, Moody's
increased the MILAN CE assumption to 10.0% in Cordusio RMBS -
UCFin S.r.l. and Cordusio RMBS Securitization S.r.l. - Series
2007, decreased the MILAN CE assumption to 8.5% in Cordusio RMBS
S.r.l and maintained it at 8.5% in Cordusio RMBS Securitization
S.r.l. - Series 2006.

- Exposure to Counterparty Risk

The downgrade of Class B notes in Cordusio RMBS - UCFin S.r.l.
and Class B notes in Cordusio RMBS Securitization S.r.l. - Series
2006 also reflect the commingling and set-off risks due to
exposure to UniCredit SpA (Baa2/P-2) acting as originator,
collection account bank and issuer account bank. Moody's has
assessed the probability and effect of a default UniCredit SpA on
the ability of the issuers to meet their obligations under the
transactions. The exposure to UniCredit SpA is factored in the
downgrade of these notes.

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.

The methodologies used in these ratings were Moody's Approach to
Rating RMBS Using the MILAN Framework published in May 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 ABSROM to model the
cash flows and determine the loss for each tranche. The cash flow
model evaluates all default scenarios that are then weighted
considering the probabilities of the lognormal distribution
assumed for the portfolio default rate. In each default scenario,
the corresponding loss for each class of notes is calculated
given the incoming cash flows from the assets and the outgoing
payments to third parties and noteholders. Therefore, the
expected loss or EL for each tranche is the sum product of (i)
the probability of occurrence of each default scenario; and (ii)
the loss derived from the cash flow model in each default
scenario for each tranche."

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

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, for Cordusio RMBS S.r.l. Moody's corrected
the notes margin, in Cordusio RMBS - UCFin S.r.l. Moody's
corrected modeling of the artificial write-off mechanism and
interest deferral triggers and in Cordusio RMBS Securitization
S.r.l. - Series 2006 Moody's corrected the modeling of the
artificial write-off mechanism.

List of Affected Ratings

Issuer: Cordusio RMBS S.r.l.

EUR119.2M C Notes, Downgraded to Baa3 (sf); previously on May 22,
2012 Baa1 (sf) Placed Under Review for Possible Downgrade

Issuer: Cordusio RMBS - UCFin S.r.l.

EUR75M B Notes, Downgraded to Baa2 (sf); previously on Aug 2,
2012 Downgraded to A2 (sf) and Placed Under Review for Possible

EUR25M C Notes, Downgraded to Baa3 (sf); previously on Aug 2,
2012 Downgraded to A2 (sf) and Placed Under Review for Possible

EUR48M D Notes, Downgraded to Ba2 (sf); previously on Aug 2, 2012
Baa2 (sf) Placed Under Review for Possible Downgrade

Issuer: Cordusio RMBS Securitization S.r.l. - Series 2006

EUR45.7M B Notes, Downgraded to Baa1 (sf); previously on Aug 2,
2012 Downgraded to A2 (sf) and Placed Under Review for Possible

EUR96M C Notes, Downgraded to Ba3 (sf); previously on Aug 2, 2012
Baa2 (sf) Placed Under Review for Possible Downgrade

Issuer: Cordusio RMBS Securitization S.r.l. - Series 2007

EUR738.6M A3 Notes, Confirmed at A2 (sf); previously on Mar 13,
2013 A2 (sf) Placed Under Review for Possible Downgrade

EUR71.1M B Notes, Downgraded to Baa2 (sf); previously on Aug 2,
2012 Downgraded to A2 (sf) and Remained On Review for Possible

EUR43.8M C Notes, Downgraded to Baa3 (sf); previously on Aug 2,
2012 Downgraded to A2 (sf) and Remained On Review for Possible

EUR102M D Notes, Downgraded to B1 (sf); previously on Nov 27,
2012 Downgraded to Ba3 (sf) and Remained On Review for Possible

EUR19.5M E Notes, Downgraded to Caa1 (sf); previously on Nov 27,
2012 Downgraded to B3 (sf) and Remained On Review for Possible


ICENTRE: Applies for Court Protection From Creditors
----------------------------------------------------, citing tech website, reports that
iCentre has applied for court protection from creditors.

iCentre has been owned by private equity company Antea since
2008, discloses.

According to, Tweakers quoted a source as saying
that iCentre is embroiled in a conflict with Apple and has been
forced to import hardware via Media Markt in Germany for the past
year.  The arrival of the massive official Apple store in central
Amsterdam may also have impacted on earnings, notes.

In 2011, the company made a net profit of EUR3.1 million on
turnover of EUR116 million, says, citing Chamber of
Commerce figures.

iCentre is a Dutch Apple reseller.  The company has 34 branches


ONT CARPATI: Liquidator Fails to Sell 35% Societatea Stake
Iona Tudor at Ziarul Financiar reports that no investor bought
the taskbook to participate in an auction for the sale of
bankrupt firm ONT Carpati's 35% stake in Societatea Companiilor
Hoteliere Grand, the owner of five-star hotel JW Marriott in

VF Insolventa, the liquidator of ONT Carpati, put up the 35%
stake for sale.

ONT Carpati is a Romanian tourism agency.


EXILLON ENERGY: S&P Withdraws Preliminary 'B' Corp. Credit Rating
Standard & Poor's Ratings Services withdrew its preliminary 'B'
long-term corporate credit rating on the Russian independent oil
company Exillon Energy Plc.  At the same time, S&P withdrew its
'B' preliminary rating on Exillon's senior unsecured debt.

S&P has withdrawn the ratings at Exillon's request and understand
that the company is no longer pursuing its previously considered
eurobond issue.  The preliminary ratings were based on
preliminary information and subject to a bond issue.


AVANZA SPAIN: Moody's Assigns 'B1' Rating to Sr. Secured Bonds
Moody's Investors Service has assigned a definitive B1 rating and
loss given default (LGD) assessment of LGD4 to Avanza Spain
S.A.U.'s EUR315 million of senior secured fixed rate bonds due
2018 issued by AG Spring Finance Limited and a definitive B2
rating and LGD assessment of LGD6 to Avanza's EUR175 million of
senior unsecured fixed rate bonds due 2019 issued by AG Spring
Finance II Limited. Avanza's B1 corporate family rating (CFR) and
Ba3-PD probability of default rating (PDR) remain unchanged. The
outlook on all ratings is stable.

The company used the proceeds of the Senior Secured Bonds and the
Senior Unsecured Bonds to refinance existing senior facilities
within Avanza, the ultimate holding company of the subsidiary
guarantors to the group's senior credit facilities. The company
has also raised a EUR50 million super senior revolving credit
facility ("RCF") due 2017. As part of the refinancing, Avanza
Spain S.A. and Avanza Interurbanos S.L. have been consolidated
within Avanza, allowing the key assets of the group to be
consolidated going forward.

Ratings Rationale:

Moody's definitive ratings of Avanza's debt obligations are in
line with the provisional ratings assigned on 16 May 2013.

"Avanza's B1 CFR reflects its small size, its high reliance on
Spanish public authorities for timely settlement of invoices, and
the company's high financial leverage albeit somewhat mitigated
by the length and steady earnings profile of its regulated
concessions" says Declan O' Brien, a Moody's Analyst and lead
analyst for Avanza.

The B1 CFR assigned to Avanza reflects the company's high
financial leverage, which is 7.1x gross debt/EBITDA (on a
Moody's-adjusted basis) and 6.5x net debt/EBITDA (on a Moody's-
adjusted basis) for the financial year-end December 2012 on a pro
forma basis. While the CFR is weakly positioned in the B1 rating
category, the rating is based on Moody's expectation that the
company will deliver on its business plan to reduce net
debt/EBITDA to 6x by financial year-end December 2013 and to
continue to decrease net debt thereafter. The high leverage is
mitigated by the regulated nature of the long term and exclusive
concessions which provides high stability and visibility to
EBTIDA as approximately 75% of revenues are generated from
concessions protected from cost increase risk and 85% of
concessions, by revenues, are in the urban and suburban bus
segments where lack of alternative is a significant factor in
choosing the company's services; these lines of business have
performed robustly through the financial crisis. Additionally,
the company's weighted average concession life, by revenues, is
11.6 years as of March 2013 and the company has virtually a 100%
renewal rate since 1885 providing additional visibility around
medium to long-term earnings.

Avanza's liquidity is good with a cash balance of EUR46.8 million
for year-end 2012. Internally generated cashflow is adequate and
the company is not forecast to draw under its EUR50 million RCF.
The business capital expenditure can change substantially from
year-to-year as requirements are dependent on the terms of their
contracts but the average age of Avanza's fleet is young at 6.4
years, well below requirements under Spanish law. Moody's expects
that the company's internally generated cashflow should cover the
company's ongoing basic cash needs, such as debt service, working
capital needs and expected capital expenditures. Avanza receives
approximately 35% of its revenues in the form of subsidies from
Spanish public authorities. Avanza had a negative working capital
movement in 2011, partly due to a delayed settlement of invoices
although this was largely reversed in 2012. Moody's views the
timely receipt of subsidy payments as a key credit risk for the
company going forward.

The B1 CFR also reflects Moody's view that Avanza (1) is a
leading company in its key markets of urban, suburban and long
distance bus concessions; (2) has increased total revenues and
EBITDA by 7.6% and 7.9%, respectively, for the period 2009-2012;
(3) that 84% of its revenues are contracted beyond 2018; and (4)
has regulated concessions with a long weighted average concession
life and virtually 100% renewals since the 19th century. However,
the CFR also reflects that the company (5) is highly leveraged
with gross debt: EBITDA of 7x; (6) is exposed to unfavorable
dynamics in the long-distance sector; and (7) has a financing
structure which does not include any maintenance covenants.

Given the lack of maintenance covenants under the bonds and the
RCF, Moody's views Avanza's financial structure as covenant lite.
Using Moody's Loss Given Default (LGD) methodology Moody's
assumed a 35% recovery rate rather than the standard 50% rate due
to the covenant lite nature of the financial structure. This
results in a PDR of Ba3-PD, one notch higher than the CFR. Also
in accordance with Moody's LGD methodology, the Senior Secured
Bonds are rated B1 (LGD4), in line with the B1 CFR and the Senior
Unsecured Bonds are rated B2 (LGD6), one notch below the CFR.


The stable outlook on the rating reflects Moody's expectation
that Avanza will (1) maintain its current performance and
continue to generate positive free cash flow; and (2) reduce its
net debt/EBITDA to below 6.0x.

What Could Change The Rating Up/Down

Positive pressure on the ratings could materialize if Avanza (1)
maintains its current operating performance; (2) generates
sustained positive free cash flow; and (3) improves its leverage
profile such that its Moody's-adjusted net debt/EBITDA ratio is
solidly below 5.0x.

Conversely, negative pressure on the ratings would emerge if
Avanza's liquidity profile and credit metrics deteriorate as a
result of (1) weakening operational performance; (2)
acquisitions; or (3) an aggressive change in its financial
policy. Quantitatively, Moody's would also consider downgrading
Avanza's ratings if (1) its adjusted net debt/EBITDA ratio
remains above 6.0x for a prolonged period and if adjusted gross
debt/EBITDA is trending towards 7.0x; or (2) the company reports
negative free cash flow on a regular basis.

These ratings were assigned by evaluating factors that Moody's
considers relevant to the credit profile of the issuer, such as
the company's (1) business risk and competitive position compared
with others within the industry; (2) capital structure and
financial risk; (3) projected performance over the near to
intermediate term; and (4) management's track record and
tolerance for risk. Moody's compared these attributes against
other issuers both within and outside Avanza's core industry and
believes Avanza's ratings are comparable to those of other
issuers with similar credit risk. Other methodologies used
include Loss Given Default for Speculative-Grade Non-Financial
Companies in the U.S., Canada and EMEA published in June 2009.

Headquartered in Madrid, Avanza is a leading provider of bus
transportation services in Spain. The company is 93% owned by
Doughty Hanson, a private equity firm, while the management of
the group indirectly own 7% of the ordinary shares of the
company. Avanza has four principal lines of business: urban,
suburban and long-distance bus services, and bus terminals,
representing 40.4%, 44.4%, 10.9% and 4.3% of revenue in 2012,
respectively. Avanza is the largest privately-owned bus
transportation operator in the urban and suburban bus
transportation markets in Spain and the second largest long-
distance bus transportation operator in Spain, in each case in
terms of fleet.

* SPAIN: SAREB Sales Underscores Property Market Weakness
Fitch Ratings says the start of property sales by Spain's bad
bank, SAREB, underscores its negative view on the Spanish
residential property market. As the pace of disposals by SAREB
speeds up, it will add to supply which may further depress
prices.  SAREB (Sociedad de Gestion de Activos Procedentes de la
Reestructuracion Bancaria S.A., which is managing assets
transferred from Spain's largest nationalized lenders) said last
week it had closed sales of 550 homes in three months from late

Taking into account the 800 more sales that SAREB said are
pending and the further 2,200 preliminary offers it said have
been made on properties, and the total could rise to 3,550. The
figures also do not include the results of a sales campaign
conducted at the recent Madrid International Real Estate
Exhibition. Nevertheless, the rate of actual sales will have to
be accelerated for SAREB to meet its target of selling 42,500
homes in the next five years given its 15-year deadline to
liquidate the portfolio (SAREB's portfolio includes over 55,000

This could prompt increased selling by banks, some of which have
already begun lowering prices and accelerating disposals in
anticipation of supply from SAREB depressing prices further.
However, SAREB and the banks will want to find the right balance
between speeding up the pace of asset sales and causing prices to
fall, and it does not appear to be in the interest of either to
trigger additional sharp property price declines by an overly
aggressive sales approach. SAREB has a 15% annual return on
equity target and its majority shareholders are the banks that it
will compete with as a seller in the residential property market.

It is not clear how long it will take SAREB to dispose of its
property portfolio. "We think excess supply of property will
continue while SAREB and lenders have such large portfolios to
liquidate. Therefore, we do not expect Spanish house prices to
trough before the end of 2014 at the earliest, although there may
be earlier signs of stabilization in regions that experienced
less dramatic pre-crisis housing booms," Fitch says.

Overall, the imbalance between supply and demand means we think
it will take several years to absorb the entire stock of
properties that have to be sold by both SAREB and private
lenders. Official sources suggest a stock of unsold new
properties in Spain of around 700,000 units (these do not take
into account the 620,000 properties built since 2004 under the
cooperative system or self-construction, or unfinished
developments). 2012 saw around 114,000 newly built properties
sold. At that rate, it will take more than six years to clear the
existing property overhang.

Combined with the weak labor market and limited access to the
capital markets for most of Spain's banks, this means the bottom
of the residential market is unlikely to be reached soon.

"In our RMBS criteria update published on 20 March, we increased
the haircut for repossessed properties in light of property
market dislocation. These forecasts took account of the likely
impact of SAREB's sales on the market. Last year, we increased
our forecast for Spanish foreclosures by 25% and said we expected
house prices to bottom out at 40% below their 2008 peak," Fitch


SAAB AUTOMOBILE: Judge Dismisses Spyker Suit v. GM Over Sale
The Associated Press reports that a federal judge has dismissed a
US$3 billion lawsuit filed by Dutch car maker Spyker against
General Motors Co.

Spyker sued GM last August, accusing it of unfairly blocking a
deal to let a Chinese buyer take over Swedish carmaker Saab, the
AP recounts.

GM sold Saab to Spyker in 2010, the AP discloses.  Saab filed for
bankruptcy protection less than a year later after GM blocked its
sale to a Chinese automaker, the AP relates.

According to the AP, GM asked U.S. Judge Gershwin Drain to
dismiss the suit, saying it had the right to protect its
intellectual property.  Spyker argued that the deals didn't
involve GM's proprietary technology, the AP notes.

Judge Drain sided with GM and dismissed the lawsuit Monday, the
AP relates.

          About Saab Automobile AB and Saab Cars N.A.

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

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

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

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

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

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

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

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


* UKRAINE: Simplifies Company Bankruptcy Procedures
Worldwide News Ukraine on June 10 disclosed that deregulation of
business activity has become one of the reform priorities for
Ukraine in 2012.  It was conducted in four major areas --
simplifying procedures for opening and closing a business,
simplifying property registration, lifting the tax burden, as
well as reforming public services system and narrowing state
control for businesses.  The results and prospects of business
deregulation were addressed by the President of Ukraine Viktor
Yanukovych in his annual message to the parliament of the country

Ukraine reduced the number of license-restricted business
activities, introduced beta version of the single state
administrative services website,opened 114
regional centers for administrative services.  The minimum
authorized capital and the requirement to notarize business
statutory documents have been dropped.  The option of online
business registration has made the process faster and cheaper.

Some of the major conveniences for businesses are related to
reporting.  Companies no longer report opening a bank account to
the state, the banks are doing the job instead.  Medium and large
companies in Ukraine are now able to conduct electronic filing
and payment.  Since 2013, businesses provide annual income
reports, while previously the reports were submitted quarterly.

Ukraine is also broadening the application of automatic VAT
refunds.  Currently, more than half of refunds is paid out
automatically.  The ongoing tax reform has led to income tax
decrease to 19 percent in 2013.  As part of the reform, Ukraine
introduced a VAT relief for software operations, established
income tax for companies working in this area at 5 percent, as
well as decreased license fees for hydrocarbon producers.

Additionally, Ukraine simplified bankruptcy procedures by
limiting the maximum duration of liquidation (no longer than one
year).  The announcement on bankruptcy proceedings in a company
will be published by the official website of the High Commercial
Court of Ukraine.

Aiming for further business deregulation, the Eastern European
country aims to provide electronic registration of businesses,
decrease paperwork by eliminating the need for businesses to
place multiple inquiries to state bodies, and introduce the
procedure of closing a business by declaration.

Ukraine's improvement in starting a business, registering
property, and paying taxes has been highlighted by Doing Business
2013 World Bank report.

U N I T E D   K I N G D O M

CAITHNESS STONE: Severe Cash Flow Problems Prompt Administration
Gareth Mackie at The Scotsman reports that Caithness Stone
Industries has called in the administrators after succumbing to
increased costs and competition.

According to the Scotsman, joint administrator Iain Fraser, of
RSM Tenon, said heavy investment had landed it with "severe and
unsustainable cash flow problems".

"The company invested heavily in new technology in order to
improve the efficiency of extraction and processing, and
successfully diversified into new residential markets," the
Scotsman quotes Mr. Fraser as saying.  "We will now undertake a
thorough review of Caithness Stone Industries, the results of
which will determine the next steps for the administration."

Founded in 1999, Caithness Stone Industries is a Spittal-based
quarrying firm.  The company generated a turnover of more than
GBP3 million last year.

COLLBIO: Gets More Than GBP250,000 Funding to Relaunch Business
Peter Ranscombe at The Scotsman reports that Collbio, which rose
from the ashes of collapsed parent Angel Biotechnology, has
secured more than GBP250,000 from private investors to relaunch
its business.

The company was created in March after Aim-quoted Angel fell into
the arms of administrators a month earlier, following the
termination of rescue talks with a group of overseas investors,
the Scotsman recounts.

Collbio, which is run by former Angel acting chief executive
Stewart White and ex-operations manager Ross Andrews, took over
the failed company's Glasgow facility, which Angel bought from
sausage skin maker Devro last year for GBP200,000, the Scotsman

The site makes collagen, a material that is used to coat
prosthetic implants like hip replacement joints, in wound
dressings and as a "scaffold" to which cells can be attached
during tissue-engineering, the Scotsman discloses.

News of the funding deal comes a month after Collbio secured a
contract to supply collagen to New York-listed Cardium
Therapeutics, continuing a relationship with the Glasgow facility
that began under Angel, according to the Scotsman.

Collbio is a Glasgow-based life sciences firm.

GODFREY DIY: Closes Two Remaining DIY Stores in Diss & Stowmarket
Shaun Lowthorpe at reports that retailer Barry
Godfrey has pulled the plug on his remaining two DIY stores in
Diss and Stowmarket to focus on a new online business. says it has been a tough year for Godfrey DIY
Supermarkets Limited, which went into liquidation earlier this
year with the closure of its Norwich branch and the loss of about
20 jobs.

But with Mr. Godfrey's company, Harvey House Retail, buying part
of the business out of liquidation in February, the Diss and
Stowmarket stores remained trading with a reduced head count of
15 staff, the report notes.

But following disappointing sales and a tough spring, those
stores are now set to close, relays.

"We have been unable to achieve the turnover we needed in the
four months that we have traded and as anyone in this retail
sector knows, it's the springtime, with its numerous bank
holidays, that makes the DIY/garden business worthwhile. I did
not want to trade beyond the spring into a period where turnover
is likely to be weaker," the report quotes Mr. Godfrey as saying.

"It was very difficult to win back customers after closure of
Godfrey DIY, and of course, many of them changed their shopping
habits in the light of the original closure."

But he thanked staff for their support and said he would now
focus on a new online business, adds.

Godfrey DIY Supermarkets Limited was a DIY business which
employed 50 people in Norfolk and Suffolk.  The Company was put
into liquidation in January 2013.

IDH FINANCE: Moody's Assigns B2 Ratings to GBP325MM Notes
Moody's Investors Service has assigned definitive B2 ratings with
a loss given default assessment of LGD4 (51%) to the GBP200
million senior secured fixed rate notes due 2018 and the GBP125
million senior secured floating rate notes due 2018 as well as a
definitive Caa1 /LGD 6 (92%) rating to the GBP75 million second
lien notes due 2019, all of which have been issued by IDH Finance
plc, a subsidiary of Turnstone Midco 2 Limited.

Moody's assigned a B2 corporate family rating and a B2-PD
probability of default rating to Turnstone Midco 2 Limited on 20
May 2013 which remains unchanged. The rating outlook on all
ratings is stable.


Issuer: IDH Finance plc

Senior Secured Regular Bond/Debenture Dec 1, 2018, Assigned
definitive ratings of B2 with a range of LGD4, 51%

Senior Secured Regular Bond/Debenture Dec 1, 2018, Assigned
definitive ratings of B2 with a range of LGD4, 51%

Senior Secured Regular Bond/Debenture Jun 1, 2019, Assigned
definitive ratings of Caa1 with a range of LGD6, 92%

Ratings Rationale:

Moody's definitive ratings on these debt obligations are in line
with the provisional ratings assigned on 20 May 2013.

Following the completed refinancing, the debt instruments in
Turnstone MidCo 2's capital structure consist of a (1) GBP100
million super senior revolving credit facility due 2018, issued
by Turnstone Bidco 1 limited, which is assumed to be undrawn at
closing of the transaction (2) GBP200 million senior secured
fixed rate notes due 2018 and GBP125 million senior secured
floating rate notes due 2018 (together the senior secured notes)
and (3) GBP75 million of second lien notes due 2019.

All issued debt instruments will share the same guarantors and
collateral package. However, in an enforcement scenario the
senior secured notes will rank behind the GBP100 million senior
revolving credit facility but ahead of the GBP75 million second
lien notes. The senior secured notes and the second lien notes
will benefit from guarantees by the parent company and certain
subsidiaries representing more than 80% of the group's EBITDA. At
March 31, 2013, the guarantors represented 86.6% of consolidated
revenues and 83.1% of consolidated EBITDA.

Moody's understands that shareholder funding into the top holding
company of the restricted group, Turnstone MidCo2 Limited, will
be in the form of common equity.

Proceeds of the GBP400 million debt issuance were used to repay
the borrower's senior credit facilities (GBP332.1 million
including certain fees) and to redeem subordinated shareholder
loans and pay accrued preference shares (GBP50 million).

The B2 CFR reflects (1) the group's relatively small scale
compared with that of similar Moody's-rated companies, with
revenues of just GBP349 million in fiscal year 2013 (ending 31
March 2013); (2) its high financial leverage pro-forma the
refinancing of around 7.1x (5.7x on a pro-forma EBITDA basis,
considering the full year effect of acquisitions made during
fiscal year 2013), with only modest interest coverage; and (3)
the group's aggressive and largely debt-funded acquisition growth
strategy, which will constrain future debt reduction and free
cash flow generation after taking into account acquisition-
related capital expenditure (capex). Nevertheless, the CFR
recognizes the discretionary nature of IDH's acquisition
strategy, which Moody's understands could be scaled back to
preserve financial flexibility if needed, as well as the group's
solid track record of integrating acquired dentistries.

Positively, the B2 CFR also factors in (1) IDH's good, but still
small, position in the fragmented UK dental healthcare market,
with around 78% of revenues generated through evergreen UK NHS
(National Health Service) contracts, which provide good revenue
visibility; and (2) the group's ability to generate positive free
cash flow after interest expenses as a result of low maintenance
capex and working capital needs. Furthermore, the CFR
incorporates the positive long-term industry trend in the UK
dental care market, supported by the NHS's stated intention to
increase access to dental care in the UK.

Additional risk factors reflected in IDH's rating are regulatory
and legal risks associated with the UK dental healthcare market,
such as the risk of budget cuts, the risk of personnel expenses,
which comprise the bulk of IDH's overall costs, rising more
strongly than the adjustments in the NHS fees, or a change in the
currently favorable terms of existing and future NHS contracts.

The stable outlook considers Moody's expectation of revenue
growth and EBITDA improvement mainly from newly acquired branches
supporting a gradual reduction in leverage to 6.0x, measured by
Moody's adjusted debt/EBITDA, over the next 12 months.

What Could Change The Rating Up/Down

The ratings could be downgraded in case of a deterioration in
operating performance or increasingly aggressive financial policy
that would result in Moody's adjusted debt/EBITDA not falling
below 6.0x by year-end of fiscal year 2014, negative free cash
flow and/or a depletion of its liquidity buffer.

An upgrade of the ratings is unlikely over the near term due to
the company's aggressive growth strategy which will constrain
free cash flow and limit debt reduction, as well as the forward
looking nature of the assigned ratings. The rating could be
upgraded in case of revenue growth and EBITDA improvement from
newly acquired branches supporting a sustained reduction in
leverage to below 5.0x and positive free cash flow generation
being sufficient to fund acquisitions.

Principal Methodology

The principal methodology used in this rating was the Global
Healthcare Service Providers published in December 2011. Other
methodologies used include Loss Given Default for Speculative-
Grade Non-Financial Companies in the U.S., Canada and EMEA
published in June 2009.

Headquartered in Manchester (UK), IDH provides dentistry services
in England, Scotland and Wales employing 4,931 people and
generated GBP349 million of sales in the fiscal year ending March
2013. IDH is owned by private equity firms The Carlyle Group and
Palamon Capital Partners.

INTERNATIONAL OPERA: Placed Into Liquidation
-------------------------------------------- reports that some of London's largest corporates face
losing a combined GBP300,000 after it was confirmed that
International Opera Productions (IOP) was placed into

Ten staff were made redundant after IOP director Christopher
Palmer-Jeffrey liquidated the firm which had been organising the
London Opera Festival, set to be held at the Tower of London from
September 9 to September 12, 2013, according to

According to the report, Neil Gibson, managing director of GIA
Insolvency Limited, said creditors who had bought the corporate
hospitality packages had "virtually no chance of getting their
money back" as IOP's assets amounted to a small amount of office
equipment and a small amount of cash in the bank.
relates that Mr. Gibson said the festival, for which VIP tables
for 10 people were being sold at up to GBP4,490, was unlikely to
go ahead. Just 60 tables had been sold, which contributed little
over a quarter of the expected break-even point of GBP1 million,
the report relays.

"Sales were a lot less than they were expecting. This is an
expensive event and generally speaking, companies are spending
less and less than they used to on corporate hospitality. I
suspect it's a case of right idea at the wrong time," the report
quotes Mr. Gibson as saying. says the Rostov State Opera, from Russia, was booked
to perform Puccini's Madama Butterfly at the Festival, billed as
'one of the most prestigious corporate hospitality events for
2013'.  Mr. Palmer-Jeffery, was a former director of European
Events Ltd which went bust in February 2009 owing GBP1.6 million,
the report discloses.

Mr. Gibson said individuals who booked tickets through German
ticketing services provider CTS Eventim are protected and will be
reimbursed, adds.

MEDIAGROUND LTD: Goes Into Administration
Aly Barchi at the CMW News reports that following news that the
latter half of London's Playground Festival had been cancelled
after less than great ticket sales - but leaving the July 7
listings still intact - the entire weekend event has since gone
the same way, with the festival's seven year-old promoter
Mediaground Ltd going into administration.

CMW News relates that a basic explanation on the Playground site
reads: "We are sad to say that after much of a battle here we
have been left with no option but to cancel the entire festival.
After poor ticket sales and an investor parting ways with us we
weren't able to rectify the matter. Mediaground Ltd has been left
with no option but to file for insolvency moving forward."

The report discloses that in addition to granting immediate
paybacks to ticketholders at point of purchase, The Playground is
also staging a one-off live show at London's Koko on 13 Jul, info
on which the promoter promises to share soon.

PUNCH TAVERNS: Restructuring Plan Fails to Win Investor Backing
Roland Gribben at The Telegraph reports that Punch Taverns has
been plunged into a fresh crisis after indications that revised
proposals to restructure its GBP2.4 billion of securitized debt
had failed to win the support of key investors.

According to the Telegraph, the company warned on Monday it could
face administration without an agreement from senior bondholders.
But sources said Punch had not gone far enough to win the backing
of the investors, who are represented by a special committee set
up by the Association of British Insurers, the Telegraph relates.

Stephen Billingham, Punch executive chairman, plans further
discussions with investors this week but, unless there are more
concessions, the company could be facing the prospect of failing
to meet debt covenants, the Telegraph notes.

The group has been saddled with a debt mountain built up during
an expensive series of acquisitions in the boom years which
propelled it into the FTSE 100 and made a City star out of then-
chief executive Giles Thorley, the Telegraph discloses.

But the highly geared model was battered by the financial crisis
and the group needs a considerable cash injection to avoid a
default, the Telegraph states.  The group now has around 5,000
pubs compared with more than 7,000 at its peak, the Telegraph

Senior bondholders rejected a restructuring package in February
and there was disappointment on Monday that Punch had gone no
further than to tweak the earlier debt program, the Telegraph

                       Restructuring Plan

According to The Financial Times' Roger Blitz, unveiling the new
plans, Punch said interest payments would fall to GBP32 million a
year, which would also deleverage the group to about 1.8 times
earnings before interest, tax, depreciation and amortization by

The previous plan, rejected by shareholders in March to the
frustration of the Punch board, envisaged a GBP463 million
reduction in debt service payments, the FT notes.  Punch, as
cited by the FT, said that the new plan would reduce debt service
repayments by GBP600 million over five years.

The new deal benefits senior noteholders in the company's two
securitized vehicles with an accelerated pre-payment of debt, and
an option enabling them to sell their senior notes for cash, the
FT says.

Punch Taverns plc is a United Kingdom-based pub company.  The
Company is engaged in the operation of public houses under either
the leased model or as directly managed by the Company.  The
Company operates in two business segments: punch partnerships, a
leased estate and punch pub company, a managed estate.


* EUROPE: Moody's Says Outlook for Steel Industry to Remain Neg.
The outlook for the European steel industry will remain negative
over the next 12-18 months as a result of pressured steel prices,
says Moody's Investors Service in a outlook update on the sector
entitled "European Steel Outlook Remains Negative As Recovery May
Take Longer To Materialise."

"We expect weak demand, capacity utilization below 75%, and
falling raw material prices to keep downward pressure on steel
prices, not only for hot rolled coil but also for long carbon
steel products used primarily in construction, high-strength
steel used in transportation and engineered products, and
stainless steel," says Steven Oman, a Moody's Senior Vice
President and author of the outlook update.

Depressed steel prices will pressure nearly all of Moody's
European issuers, including ThyssenKrupp AG (Ba1 negative),
Aperam SA (B1 negative) and Schmolz + Bickenbach AG (B3 under
review), while ArcelorMittal (Ba1 negative) should benefit from
its global footprint and expanding iron ore production.

The prolonged weakness of the European economy has now affected
every steel-using end market in Europe and is dampening demand in
other regions, forcing Commonwealth of Independent States (CIS)
producers, for example, to rely heavily on domestic sales.
Moody's believes that steel demand within the 27 countries that
make up the European Union will decline 2%-4% in 2013, on top of
a 9.6% decline in 2012.

GDP growth in the US, China and the rest of Asia has slowed,
global Purchasing Manager Indices (PMIs) are hovering around 50,
and structural issues are limiting government-sponsored stimulus
measures. This limits European exports of cars and capital goods
and exacerbates the steel supply-demand imbalance.

Moody's would stabilize the European steel industry sector
outlook if the European PMI rose to 49 and capacity utilization
moved to a modest 75%.

* Fitch Sees Modest Deterioration in Asset Quality for EM Banks
Fitch Ratings says in a new special report that it continues to
expect a moderate deterioration in bank asset quality across many
emerging markets (EMs) as loan books season following recent
credit growth. However, in most cases Fitch believes still solid
economic performance will help to limit increases in non-
performing loans (NPLs), and banks' profits and capital should
comfortably absorb impairment charges. The most notable exception
is China, although Negative Outlooks also remain in India,
Slovenia, Argentina and Venezuela.

Asset quality in China remains a concern given the magnitude and
pace of credit growth. A rising share of new credit, particularly
among mid-tier banks, is being booked off-balance sheet,
complicating risk assessments. Loss-absorption capacity is under
pressure, and is likely to be more of an issue as loans season.
Most banks can absorb a rise in delinquencies to mid-single
digits, after which government support may be required.

Fitch expects Indian banks' NPL ratios to increase gradually over
the next few quarters due to the economic slowdown and
significant restructured, but currently performing,
infrastructure loans. However, profits and reserves should absorb
credit costs, and the authorities remain committed to supporting
government banks' capital. Outlooks in other EM Asia banking
sectors are stable due to only a moderate expected increase in
credit costs, strong profit and sound capitalization.

The sharper-than-expected deceleration of the Brazilian economy,
following recent rapid credit expansion, is causing somewhat
higher impairment in retail/SME portfolios, and the lower policy
rate has put some pressure on margins. However, most banks' still
comfortable capital and liquidity mitigate these concerns.
Elsewhere in LatAm, Outlooks are Stable in Mexico, Chile, Peru
and Colombia, but Negative on Argentine and Venezuelan banks due
to potential macro rebalancing/volatility.

Turkish banks' credit metrics have remained sound after recent
rapid credit growth and the slowdown in 2012. Fitch expects only
a moderate increase in NPLs as loan books season, with economic
growth supporting credit quality. Further erosion of still sound
capital and funding ratios should be limited, given expected loan
growth of 15%-20%.

In Russia, Fitch has concerns about rapid retail loan growth,
legacy corporate asset quality problems, tighter capital and a
slowing economy. Solid performance and capital at some banks
mitigate these risks, while others are more vulnerable. Progress
with loan book clean-ups in Kazakhstan and Ukraine remains

Slovenian banks need significant recapitalization due to
increasing, and weakly reserved, NPLs. Elsewhere in central and
eastern Europe, there are signs of NPLs stabilizing in some of
the weaker markets, and parent banks remain supportive.

Government stimulus, in particular through infrastructure
spending, should support growth in the GCC, aiding banks'
performance and asset quality, but legacy NPLs are significant in
the UAE and Kuwait. Lower NPLs at South African banks have been
driven in part by low interest rates, but consumer loan growth
creates downside risks.

82% of EM bank IDRs had a Stable Outlook at end-Q113. 15% of
ratings had a Negative Outlook/Watch, with concentrations in
India, Slovenia, Venezuela and Argentina, but this was down from
18% at end-Q312 as South African and Belarusian banks' Outlooks
were revised to Stable following sovereign credit profile


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

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

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

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


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

Troubled Company Reporter-Europe is a daily newsletter co-
published by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA.
Valerie U. Pascual, Marites O. Claro, Rousel Elaine T. Fernandez,
Joy A. Agravante, Ivy B. Magdadaro, Frauline S. Abangan and Peter
A. Chapman, Editors.

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

This material is copyrighted and any commercial use, resale or
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Information contained herein is obtained from sources believed to
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