TCREUR_Public/140103.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, January 3, 2014, Vol. 15, No. 2



AZERBAIJAN: Endorses Licensing E-Forms for Brokers & Warehouses


QIMONDA AG: Administrator Sues HP for Patent Infringement


* IRELAND: Won't Get Bank Repayments in June


MECHEL OAO: Oleg Korzhov to Take Over as Chief Executive
RASPADSKAYA OAO: Moody's Affirms 'B2' Corporate Family Rating
SUDOSTROITELNY BANK: S&P Assigns 'B' Rating; Outlook Stable


NCG BANCO: Moody's Reviews 'Ba1' Bond Ratings for Downgrade
NCG BANCO: Moody's Reviews 'B3' Debt Ratings for Downgrade


* S&P Affirms 'B-/C' Ratings on Three Ukrainian Banks

U N I T E D   K I N G D O M

DEBENHAMS PLC: Finance Boss Steps Down After Major Profit Warning
GERALD DAVID: Owes Farmer GBP11,000
HIGGS CAPITAL: Faces Closure Following Investor Redemptions
OSBORNE STATIONERS: In Administration, Calls in FRP Advisory
SKIPTON BUILDING: Moody's Changes Ratings Outlook to Stable

WASABI ENERGY: Goes Into Voluntary Administration
ZLOMREX: Jan. 8 Meeting Set to Approve Scheme of Arrangement

* UK: Number of Retail Sector Administrations Down 6% in 2013
* UK: Twenty Scottish Firms to Go Bust Every Week This Year
* UK: Number of Zombie Companies Down in November, R3 Says


* BOOK REVIEW: Creating Value through Corporate Restructuring



AZERBAIJAN: Endorses Licensing E-Forms for Brokers & Warehouses
--------------------------------------------------------------- reports that the Cabinet Ministers of Azerbaijan has
approved the amendments to the Rules of Executive Power's
E-services and the List of E-Services.

Under the amendments, receipt of documents for a license for
customs broker and customs carrier services as well as such
license suspension and liquidation will be conducted in e-form,
according to

The report notes that besides, applications for licensing of
customs warehouses and temporary storage facilities, including
the license suspension and liquidation, will also be accepted in


QIMONDA AG: Administrator Sues HP for Patent Infringement
David Manners at reports that Qimonda AG's
bankruptcy administrator, Dr. Michael Jaffe, is suing Hewlett-
Packard for patent infringement.

According to the report, the District Court of Dusseldorf has
ruled that three of the five patents which had been asserted by
Dr. Jaffe have been used by HP.

In two cases, the computer manufacturer was served with an
injunction and ordered to render account and pay damages for the
established infringement, whereas proceedings in the other case
were temporarily suspended in order to resolve open questions
regarding patent exhaustion, relates. The
remaining two cases were dismissed due to a lack of patent use.
The rulings can be appealed, the report notes.

In the two proceedings now ruled in favor of the insolvency
administrator, Jaffe had asserted apparatus claims and method
claims which relate to complex devices requiring not only the use
of DRAM components but also units such as processors, says

Infringing products are computers which HP is selling in Germany,
the report notes.

According to, the District Court in
Dusseldorf confirmed that license agreements of its suppliers
which had been concluded prior to opening of the insolvency
proceedings and upon which HP tried to rely, do not justify
license rights with respect to the computers in dispute.

The report says the court did not need to address the question as
to whether non-exclusive licenses survive in case of insolvency.
The enforceability of license agreements in light of the
insolvency of Qimonda AG is the subject of separate court
proceedings in Germany and the U.S., as among others with
Infineon Technologies AG. adds that HP has filed nullity actions with
the German Federal Patent Court for the patents in dispute. No
rulings have as yet been issued. The Dusseldorf District Court
did not see any cause to suspend the patent infringement
proceedings in view of the validity proceedings, the report

                         About Qimonda AG

Qimonda AG (NYSE: QI) -- was a global
memory supplier with a diversified DRAM product portfolio.  The
Company generated net sales of EUR1.79 billion in financial year
2008 and had -- prior to its announcement of a repositioning of
its business -- roughly 12,200 employees worldwide, of which
1,400 were in Munich, 3,200 in Dresden and 2,800 in Richmond, Va.

Qimonda AG commenced insolvency proceedings in a local court in
Munich, Germany, on Jan. 23, 2009.  On June 15, 2009, QAG filed
a petition (Bankr. E.D. Va. Case No. 09-14766) for relief under
Chapter 15 of the U.S. Bankruptcy Code.

Qimonda North America Corp., an indirect and wholly owned
subsidiary of QAG, is the North American sales and marketing
subsidiary of QAG.  QNA is also the parent company of Qimonda
Richmond LLC.  QNA and QR sought Chapter 11 protection (Bankr.
D. Del. Case No. 09-10589) on Feb. 20, 2009.  Mark D. Collins,
Esq., Michael J. Merchant, Esq., and Lee E. Kaufman, Esq., at
Richards Layton & Finger PA, in Wilmington Delaware; and Mark
Thompson, Esq., Morris J. Massel, Esq., and Terry Sanders, Esq.,
at Simpson Thacher & Bartlett LLP, in New York City, represented
the Debtors as counsel.  Roberta A. DeAngelis, the United States
Trustee for Region 3, appointed seven creditors to serve on an
official committee of unsecured creditors.  Jones Day and Ashby &
Geddes represented the Committee.  In its bankruptcy petition,
Qimonda Richmond, LLC, estimated more than US$1 billion in assets
and debts.  The information, the Chapter 11 Debtors said, was
based on QR's financial records which are maintained on a
consolidated basis with QNA.

In September 2011, the Chapter 11 Debtors won confirmation of
their Chapter 11 liquidation plan which projects that unsecured
creditors with claims between US$33 million and US$35 million
would have a recovery between 6.1% and 11.1%.  No secured claims
of significance remained.


* IRELAND: Won't Get Bank Repayments in June
-------------------------------------------- reports that the Taoiseach Enda Kenny has
admitted Ireland will miss the target of getting some of its
banking costs back by June.

According to, Mr. Kenny says it will be at least
November this year before other EU countries might be ready to
approve a payment to Ireland.

Ireland, says, is hoping to recoup some of the
billions it spent saving AIB and Bank of Ireland, under a system
which has now been replaced for future bailouts.

The Taoiseach says European talks are complicated, but he is
still optimistic about Ireland's chances,


MECHEL OAO: Oleg Korzhov to Take Over as Chief Executive
Tanya Powley at The Financial Times reports that Mechel OAO has
replaced its chief executive as the heavily leveraged company
looks to tackle its net debt of more than US$9 billion.

According to the FT, Oleg Korzhov, the company's senior
vice-president for economics and management, will take over from
Evgeny Mikhel, who has been chief executive since 2010.
Mr. Korzhov was set to start his new role on Jan. 1, the FT

On Monday, Mechel revealed it would discuss the early resignation
of Mr. Mikhel at a board meeting that day, the FT relays.

Lossmaking Mechel is one of several Russian miners struggling to
pay down billions of dollars in pre-crisis debt after embarking
on global buying sprees in the heady days of the commodities
boom, the FT states.

Last week, Mechel, which is owned by Russian billionaire
Igor Zyuzin, reported a net loss of US$2.2 billion in the first
nine months of 2013 because of a number of one-off write downs,
the FT recounts.  This was up from a net loss of US$550 million
in the same period last year, the FT notes.

In recent months, the company has focused on securing covenant
holidays until the end of 2014 from its creditors, alleviating
pressure on the coal miner, the FT relates.  This has included
arrangements with Sberbank and a deal with a syndicate of foreign
banks, including ING, Societe Generale, UniCredit, Commerzbank,
Raiffeisen and Russia's VTB, according to the FT.

Mechel, the FT says, has been struggling with the effects of
depressed global prices for coal, which accounted for around 30
per cent of its revenues but around four-fifths of earnings last
year.  It is among the world's six largest exporters of coking
coal, a key ingredient in steelmaking, the FT notes.

Mechel OAO is a Russian steel and coking coal producer.

RASPADSKAYA OAO: Moody's Affirms 'B2' Corporate Family Rating
Moody's Investors Service has affirmed Raspadskaya OAO's
corporate family rating (CFR) and probability of default rating
(PDR) at B2 and B2-PD, respectively, and changed the outlook from
negative to stable. Concurrently, Moody's has affirmed the rating
on the senior unsecured debt issued by Raspadskaya Securities
Ltd., a limited liability company incorporated in Ireland, and
its PDR at B2 and B2-PD (with a loss-given-default (LGD)
assessment of LGD4, 50%), respectively.

"The affirmation of the rating at B2 and stabilization of outlook
follows EVRAZ plc (unrated) consolidation of 82% stake in the
share capital of Raspadskaya OAO earlier in 2013 and a degree of
potential support by Evraz evidenced by continuing integration of
Raspadskaya OAO's operations (including treasury, reporting and
budgeting functions) under EVRAZ plc and inter-group funding in
the form of a US$100 million loan provided to Raspadskaya OAO by
EVRAZ plc/Evraz Group S.A. (Ba3 stable), with which the company
refinanced bilateral bank facility," says Denis Perevezentsev, a
Moody's Vice President and lead analyst for Raspadskaya.
"Production issues at the company's Raspadskaya mine following
the temporary suspension of operations in May 2013, low coking
coal prices, weak credit metrics and lack of formal guarantees
from EVRAZ plc or Evraz Group S.A. limit the level of alignment
between CFRs of Raspadskaya OAO and Evraz Group S.A."


The rating affirmation reflects Moody's view that demand in the
metallurgical coal industry will remain weak in the near term
following substantive deterioration in 2013. Benchmark pricing
for low-volatility hard coking based on "Free on Board", or FOB
Australia basis, has fallen dramatically, to US$145/tonne for
third quarter deliveries (US$152/tonne for fourth quarter 2013)
from US$172/tonne for second quarter 2013 deliveries. This should
translate into a domestic price for Russian producers of around
US$80/tonne of coal concentrate on a "Free carrier", or FCA
(i.e., excluding transportation costs) basis, or even lower for
export deliveries. Given such weak prices (benchmark prices for
Q1 2014 deliveries are set at around US$143/tonne based on FOB
Australia basis), the gap is narrowing between these and
Raspadskaya's cash costs of coal concentrate (which the company
nevertheless managed to reduce from around US$62/tonne in 2012 to
US$54/tonne in 1H 2013), shrinking the company's operating
margins and operating cash flows. While some international
producers have announced production cuts, the net impact on the
global market is modest and the anticipated supply/demand balance
is unlikely to support meaningful near-term price improvement.

Moody's adjusted LTM Debt/EBITDA of Raspadskaya OAO as of
June 30, 2013 stands at about 8.3x and Moody's expects that the
stabilisation of coking coal prices in Q3-Q4 2013 at lower levels
compared to Q2 2013, coupled with operational issues at the
Raspadskaya mine, will cause the company's financial results and
leverage to deteriorate further in 2013. At the same time,
Raspadskaya's liquidity position is fairly comfortable, given low
debt service requirement and modest level of capex in the near
term. The company's bilateral loan of US$150 million, with
December 2015 maturity, was refinanced in September 2013 with a
loan from EVRAZ plc related entities (US$100 million), maturing
in 2016, with the balance of the loan being repaid out of
Raspadskaya's cash balances. The company's Eurobonds of US$400
million matures in 2017.

Raspadskaya's B2 CFR reflects (1) low coking coal prices, with a
low probability of substantial recovery over the next 12 months;
(2) recurring operational issues at the company's main production
mine following the two-months suspension of operations in May
2013; (3) the company's fairly small size and narrow operating
footprint; (4) Raspadskaya's lack of product, geographical or
operational diversification; (5) its high leverage and modest
cash flow metrics; (6) the company's heavy dependence on the
steel sector, which is fairly volatile; (7) Raspadskaya's
customer concentration; and (8) ownership concentration, which
could lead to a shareholder-friendly financial policy (high
dividends or share buybacks).

However, these negative factors are partially offset by
Raspadskaya's (1) extensive high-quality and fairly low-cost
semi-hard and hard coking coal reserves, with an average cash
cost of around US$54/tonne in 1H 2013, which compares favorably
with the cash costs of many international coal producers and
Russian vertically integrated steel producers; (2) strategic
importance of the company to its controlling shareholder (Evraz
plc); and (3) fairly comfortable liquidity profile, with no debt
repayments until July 2016, and only interest and coupon of
around US$40 million per year to be paid until then. The company
has a fairly large liquidity cushion (cash and short-term
deposits) of around US$100 million as at June 30, 2013. In
addition the B2 rating factors in the potential support from
Evraz in favor of Raspadskaya.


The stable outlook on the rating reflects the stable outlook of
Evraz, the increased level of integration of Raspadskaya OAO's
operations under EVRAZ plc and Moody's view that market
conditions, including coking coal prices are unlikely to worsen
meaningfully in 2014.


Negative rating pressure will develop if (1) Raspadskaya's
financial metrics continue to deteriorate as a result of
unfavourable market dynamics; (2) the company's refinancing risk
increases; (3) operational issues at the Raspadskaya mine
escalate in such a way that leads to a significant deterioration
in unit cash costs, operating profits and cash flow generation
capacity; (4) CFR of Evraz Group S.A. is downgraded or its
outlook is changed to negative; or (5) there is a noticeable
reduction in support provided by EVRAZ plc/Evraz Group S.A. to
the company.

Positive pressure on the rating might develop if coking coal
prices on domestic and export deliveries improve sustainably and
the company manages to successfully resolve operational issues at
its main production mine improving coking coal production in
2014. A formal commitment of Evraz Group S.A./EVRAZ plc to
support debt at Raspadskaya OAO -- provided no material
deterioration in the credit strength of support providers - may
also trigger an upgrade of the company's bond rating.

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

Raspadskaya is one of Russia's largest coking coal producers,
with a coal production volume of 7 million tonnes in 2012 (2011:
6.3 million tonnes) and sales of 5.0 million tonnes of coal
concentrate and raw coal (2011: 4.7 million tonnes).

The company's production assets consist of three underground
mines, one open-pit mine, a coal preparation plant, as well as a
coal transportation network and a number of integrated
infrastructure companies. All these assets are located in the
Kuzbass Basin (Kemerovo region, Russia). The company is
controlled by Evraz plc. In 2012, Raspadskaya reported revenues
of US$542 million (2011: US$726 million) and EBITDA of US$141
million (2011: US$321 million).

SUDOSTROITELNY BANK: S&P Assigns 'B' Rating; Outlook Stable
Standard & Poor's Ratings Services said it assigned its 'B/B'
long- and short-term counterparty credit ratings to Russia-based
Commercial Bank Sudostroitelny Bank LLC (SB Bank).  The outlook
is stable.  At the same time, S&P assigned its 'ruA-' Russia
national scale rating to the bank.

The ratings on SB Bank incorporate the structurally elevated
economic and industry risks factored into S&P's 'bb' anchor, its
starting point for assigning ratings to a domestic bank operating
in Russia.  They also reflect SB Bank's "weak" business position,
"moderate" capital and earnings, "moderate" risk position,
"average" funding, and "adequate" liquidity, as S&P's criteria
define these terms.  S&P assess the bank's stand-alone credit
profile (SACP) as 'b'.

S&P's assessment of SB Bank's business position as weak is based
on its view of its limited market share and customer franchise,
with quite significant concentrations in the loan book.  SB Bank
is a midsize credit institution that had assets of Russian ruble
(RUB) 65.7 billion (US$2.0 billion) on Sept. 30, 2013, making it
78th in the Russian banking sector.  SB Bank has changed its
strategy to focus more on midsize enterprises and increase their
share of the corporate loan book to 55% by the end of 2014 from
30% at the end of 2012.

S&P recognizes that this strategic shift is designed to avoid
further erosion of margins and profitability, which have been
falling for the past three years because of tough pricing
competition in Russia and SB Bank's modest commercial franchise
and branch network, which makes it difficult to attract the most
creditworthy borrowers.  But S&P still sees the move as risky in
the current operating environment in Russia, and SB Bank's
management team has yet to prove its ability to manage possible
risks arising from such a strategy.

The bank's ownership is split among 12 individuals comprising the
former and current management team.  The two largest
shareholders, Leonid Tyukhtyaev and Andrey Ivanchikhin, control
33.1% between them and provide support to the bank mostly in the
form of subordinated loans.  So far, this very diverse ownership
structure has not complicated the decision-making process and has
prevented the emergence of governance issues.

S&P's assessment of SB Bank's capital and earnings as moderate
reflects its view of the bank's gradually declining capital
position, as its earnings capacity is lower than most peers', and
prevents internal capital build up.  This assessment is based
primarily on S&P's expectations that the risk-adjusted capital
(RAC) ratio before adjustments for concentration and
diversification will remain in a range of 5.0%-5.5%, down from
7.0% at the end of 2012, due to S&P's projection of increasing
risk-weighted assets and modest retained earnings.  S&P's
forecast is based on the assumption of relatively stable loan
portfolio growth of 13%-15% over the next two years with a net
interest margin of 2.8%-3.0%.

In S&P's view, SB Bank's overall risk position is moderate.
Concentrations on the balance sheet are comparable with local
peers', although high compared with those of banks in other
countries with similar economic and industry risks.  The top 20
borrowers accounted for 33% of the loan book as of Sept. 30,
2013, 2.2x of adjusted total equity.  Nonperforming loans (NPLs)
have been consistently lower than the system average and should
remain at or below 3% in 2013 and 2014.  S&P also views
positively the ample coverage of NPLs by reserves, which it
expects to exceed 200% in 2013 and 2014.  Still, S&P believes the
bank's increasing exposure to the risky small and midsize
enterprise (SME) segment and to the real estate sector (15% of
the loan book) could impair the bank's credit risk profile,
especially if economic slowdown intensifies in Russia.

"We consider SB Bank's funding to be average and its liquidity
adequate.  The bank's funding base is quite diversified with
bonds issued on the local market (17% of total liabilities as of
Sept. 30, 2013), an outstanding amount at LORO accounts (accounts
held by a second bank on behalf of a third party) from regional
banks (13%), and clients' deposits (60%) almost equally split
between corporate and individual clients.  We note that reliance
on short-term wholesale funding has substantially declined over
the past years, in line with active deposit collection.  We
expect the bank's funding profile to be more balanced in the
future, with a loan-to-deposit ratio of 110%-120% in 2013-2014
compared with 140% in 2010-2011.  Concentrations are high in a
global context, but in line with local peers'.  The top 20
depositors accounted for 28% of total customer funds as of Sept.
30, 2013.  We believe that SB Bank's liquidity cushion is
adequate, with broad liquid assets constituting almost 30% of the
balance sheet," S&P said.

The outlook reflects S&P's expectation that the SB Bank will
continue following its strategy to further develop as a universal
commercial bank by focusing on the SME segment while keeping
capitalization and loan portfolio quality at, or only marginally
below, current levels.

S&P could lower the ratings if SB Bank's NPLs increased
significantly, leading to deterioration in earnings and
capitalization and S&P's projected RAC ratio falling below 5%.
S&P might also consider a negative rating action if the bank
experienced a loss of counterparty confidence leading to
deterioration in its liquidity.

Although it is unlikely in the next 12 months, S&P would consider
a positive rating action if the bank substantially strengthened
its business position by developing its client franchise and
significantly reducing concentrations on both the asset and
liability side of the balance sheet.


NCG BANCO: Moody's Reviews 'Ba1' Bond Ratings for Downgrade
Moody's Investors Service has placed on review for downgrade the
Ba1 rating assigned to the covered bond program issued by NCG
Banco S.A. (deposits B3 on review for downgrade; BFSR E/BCA
caa2). Moody's review was initiated following the conditional
sale of NCG Banco to Banco Etcheverria, part of the Venezuelan
Banesco Group (both entities are unrated).

Rating Rationale

The rating action on the covered bonds is prompted by Moody's
decision to place NCG Banco's B3 long-term deposit rating on
review for downgrade; the bank's standalone E bank financial
strength rating (BFSR) and baseline credit assessment (BCA) of
caa2 are not subject to the review of the issuer ratings.

The rating review follows the Spanish Fund for Orderly Bank
Restructuring's (FROB) resolution to sell NCG Banco to a division
of the Venezuelan banking group Banesco. The review also takes
into account the risk that a lower probability of systemic
support -- as a consequence of the exit of the FROB from the
capital of NCG Banco -- will not be fully outweighed by the
provision of support from its new parent company.


Moody's determines covered bond ratings using a two-step process:
an expected loss analysis and a timely payment indicator (TPI)
framework analysis.

EXPECTED LOSS: Moody's uses its Covered Bond Model (COBOL) to
determine a rating based on the expected loss on the bond. COBOL
determines expected loss as (1) a function of the issuer's
probability of default (measured by the issuer's rating); and (2)
the stressed losses on the cover pool assets following issuer

The cover pool losses for NCG Banco's mortgage covered bonds are
36.3%; this metric is an estimate of the losses Moody's currently
models if NCG Banco defaults. The rating agency splits cover pool
losses between market risk of 20.8% and collateral risk of 15.5%.
Market risk measures losses stemming from refinancing risk and
risks related to interest-rate and currency mismatches (these
losses may also include certain legal risks). Collateral risk
measures losses resulting directly from the credit quality of
cover pool assets. Moody's derives collateral risk from the
collateral score, which for this program is currently 23.1%.

The over-collateralization (OC) in the cover pool is 127.3%, of
which NCG Banco provides 25% on a "committed" basis. The minimum
OC level consistent with the current rating target is 7%, of
which the issuer should provide 0% in a "committed" form. These
figures show that Moody's is not relying on "uncommitted" OC in
its expected loss analysis.

All figures in this section are based on the most recent
Performance Overview (based on data, as per end-September 2013).

TPI FRAMEWORK: Moody's assigns a "timely payment indicator"
(TPI), which indicates the likelihood that the issuer will make
timely payments to covered bondholders if the issuer defaults.
The TPI framework limits the covered bond rating to a certain
number of notches above the issuer's long-term deposit rating.

For NCG Banco's mortgage covered bonds, Moody's has assigned a
TPI of 'Probable'.

Factors that would lead to an upgrade or downgrade of the rating

The issuer's credit strength is the main determinant of a covered
bond rating's robustness. The TPI Leeway measures the number of
notches by which Moody's might downgrade the issuer's rating
before the rating agency downgrades the covered bonds because of
TPI framework constraints.

The TPI assigned to NCG Banco mortgage covered bonds is
'Probable'. The TPI Leeway for this program is limited, and thus
any downgrade of the issuer ratings may lead to a downgrade of
the covered bonds.

A multiple-notch downgrade of the covered bonds might occur in
certain limited circumstances, such as (1) a sovereign downgrade
negatively affecting both the issuer's senior unsecured rating
and the TPI; (2) a multiple-notch downgrade of the issuer; or (3)
a material reduction of the value of the cover pool.

The credit ratings of the covered bonds were assigned in line
with Moody's existing credit rating methodology: "Moody's
Approach to Rating Covered Bonds", published July 2012. On
September 19, 2013, Moody's published a Request for Comment (RFC)
in which the rating agency proposes an adjustment to the anchor
point it uses in its covered bond analysis. If the revised credit
rating methodology is implemented as proposed, the credit ratings
of the covered bonds may be affected.

The principal methodology used in this rating was "Moody's
Approach to Rating Covered Bonds", published in July 2012.

NCG BANCO: Moody's Reviews 'B3' Debt Ratings for Downgrade
Moody's Investors Service has placed on review for downgrade the
B3 long-term debt and deposit ratings of NCG Banco, S.A.

The placement on review follows the Spanish Fund for Orderly Bank
Restructuring's (FROB) recent decision to sell NCG Banco to
Venezuela's Banesco Group. Moreover, it reflects Moody's concerns
that the provision of support from the new parent company will
not fully mitigate the reduction in the probability of systemic
support following FROB's exit from NCG Banco's capital.

NCG Banco's E standalone bank financial strength rating (BFSR;
equivalent to a caa2 baseline credit assessment or BCA) is not
affected by today's rating action.


The rating announcement follows the FROB's decision on
December 18, 2013 to sell NCG Banco to Spain-based Banco
Etcheverria, which is part of the Banesco Group (both entities
are not rated). The sale is part of the NCG Banco auction
process, which began on November 19, 2013. Upon completion of the
sale, which remains subject to compliance with all legal
requirements and the approval of national and international
authorities, the Banesco Group will take possession of 88.33% of
NCG Banco's capital. This capital is currently owned by the FROB
and the Spanish Deposit Guarantee Fund.

Moody's review will assess the implications, in terms of external
support, of the exit of the FROB from the capital of the bank and
its sale to a foreign banking group. Since NCG Banco was
nationalized in September 2011, Moody's has assessed the bank's
probability of systemic support as being high, resulting in a
two-notch uplift from the caa2 BCA. However, the exit of the FROB
from the capital of NCG Banco translates into downward rating
pressure, which is consistent with the return to a standard
assessment of systemic support. Moody's nevertheless acknowledges
that a reduced likelihood of systemic support could to some
extent be offset by the provision of parental support. The review
process will focus on assessing both the willingness and capacity
of the Banesco Group to support NCG Banco in case of need, and
the challenges this support may face given that the group is a
foreign-owned, non-European entity.

At this stage, Moody's does not anticipate that the sale of NCG
Banco will have any impact on the bank's standalone credit
assessment, which is driven by the bank's very weak profitability
and asset quality indicators as well as the challenges arising
from the fulfilment of the restructuring plan approved by the
European Commission. As such, the Dec. 30 rating action does not
affect NCG Banco's BCA of caa2.


Given the Dec. 30 placement of NCG Banco's ratings on review for
downgrade, Moody's does not currently expect any upward rating

Should Moody's assess that a lower probability of systemic
support for NCG Banco will not be mitigated by the provision of
support from the Banesco Group, this would translate into a
downgrade of the bank's long-term debt and deposit ratings.

The principal methodology used in this rating was Global Banks
published in May 2013.

Headquartered in La Coruna, Spain, NCG Banco reported total
consolidated assets of EUR60 billion as of June 30, 2013.


* S&P Affirms 'B-/C' Ratings on Three Ukrainian Banks
Standard & Poor's Ratings Services said it had revised to stable
from negative its outlooks on three Ukraine-based banks --
PrivatBank, Alfa-Bank Ukraine, and PJSC KREDOBANK.  At the same
time, S&P affirmed its 'B-/C' long- and short-term counterparty
credit ratings on all three banks and its 'uaBBB-' national scale
ratings on KREDOBANK and Alfa-Bank Ukraine.

The revision of the outlooks on the three banks follows S&P's
similar action on the sovereign.

S&P views the sovereign's creditworthiness as a key risk factor
for Ukrainian banks because of their high operational, funding,
and asset exposure to the Ukrainian economy.  In S&P's view,
receding sovereign risk could help the banks stabilize their
financial profiles.  Still, the 'B-' ratings on the banks
continue to reflect S&P's view that the country's economic
prospects remain weak, despite the promised support package from
Russia, and that operating conditions for the banks remain risky.

Based on S&P's expectations with regard to support from Russia,
it no longer expects a sharp devaluation of the Ukrainian hryvnia
against the U.S. dollar, which should limit deterioration in the
banks' asset quality, given their high percentage of loans in
foreign currencies.  Negatively, S&P expects weaker economic
growth, which is likely to reduce the banks' real loan growth
rates in the next 12-18 months.

In addition, two of the banks, Alfa-Bank Ukraine and KREDOBANK,
are subsidiaries of large groups, whose creditworthiness is
substantially superior to that of Ukraine, and which in S&P's
view would provide extraordinary support to their affiliates in
Ukraine.  KREDOBANK is a subsidiary of Poland-based Powszechna
Kasa Oszczednosci Bank Polski S.A. and Alfa-Bank Ukraine is
ultimately owned by Russian financial-industrial group Alfa Group
Consortium, whose main banking arm is Alfa-Bank OJSC.  S&P
believes this foreign ownership provides benefits, notably in
risk management and the sustainability of the commercial
franchise.  S&P views the two entities as subsidiaries with
moderate strategic importance for their respective parents.  As
such, the 'B-' ratings on the two banks benefit from one notch of
support above their 'ccc+' stand-alone credit profiles (SACPs) to
reflect the likelihood of extraordinary support in case of need.

"We view PrivatBank as having higher stand-alone creditworthiness
that the other two banks.  Its 'b+' SACP reflects its stronger
franchise, competitiveness, and risk profile than Alfa-Bank
Ukraine and KREDOBANK.  Still, the ratings on PrivatBank are
constrained by the sovereign foreign currency rating on Ukraine.
According to our criteria "Ratings Above The Sovereign --
Corporate And Government Ratings: Methodology and Assumptions,"
published on Nov. 19, 2013, we consider it appropriate for the
ratings on PrivatBank, which has around 80% exposure to Ukraine,
not to exceed those on the sovereign.  Although we acknowledge
that PrivatBank has marginal exposure to local sovereign debt and
state-related enterprises, we believe it is likely the bank would
be severely impaired by a hypothetical sovereign default and its
potential consequences for the economy.  The stress is likely to
include the National Bank of Ukraine being unable to provide
local currency liquidity to the banking sector, deterioration of
borrowers' creditworthiness due to hryvnia devaluation, potential
deposit outflows, and closed access to capital markets," S&P

The stable outlooks on the three banks reflect that on Ukraine.
S&P believes that increased chances of the Ukrainian government
meeting its external debt services over the coming 12-18 months
are a stabilizing factor for the banks' financial profiles.

Further rating actions on the banks could result from changes to
S&P's foreign currency sovereign credit ratings on Ukraine.
However, the ratings on Ukraine and the banks would not
necessarily move in tandem.

If S&P upgraded Ukraine or revised the outlook to positive, it
would take a similar action on PrivatBank, whose SACP is
currently two notches above the long-term sovereign rating.  S&P
might consider positive rating actions on KREDOBANK and Alfa-Bank
Ukraine if the banks' stand-alone credit quality continued to
improve, notably their capital and asset quality, and if S&P
raised its ratings on Ukraine.

A negative rating action on the sovereign would likely trigger
similar rating actions on the three banks.  Any failure by
KREDOBANK or Alfa-Bank to maintain their risk-adjusted capital
ratios above 3% in the next 12 months, as S&P currently expects,
could also have negative rating implications.  This could happen
if capital support from their respective parents, or internal
capital capabilities, were insufficient to offset growth in risk-
weighted assets.

U N I T E D   K I N G D O M

DEBENHAMS PLC: Finance Boss Steps Down After Major Profit Warning
Denise Roland at The Telegraph reports that Simon Herrick,
Debenhams' finance boss, has announced his resignation just days
after the troubled department store chain issued a major profits

Mr. Herrick will step down with immediate effect and leave the
company on February 7 after just two years in the job, The
Telegraph discloses.

His resignation comes just two days after the chain disclosed
that profits will now be far lower than expected because its
margins were hit by the company offering heavy discounts on
clothing in December, in a tumultuous trading period described as
a "sea of red" by Michael Sharp, chief executive, The Telegraph

However, it is understood Mr. Herrick was already under pressure
before the crucial Christmas trading period, after angering
suppliers by asking for a discount in the days running up to
Christmas, The Telegraph notes.

According to The Telegraph, Debenhams on Tuesday said that
pre-tax profits for the first half of its financial year are now
likely to be around GBP85 million, almost 25% less than City
forecasts of GBP110 million for the six months to the end of
February.  The profits warning sent Debenhams' shares down 12%,
wiping GBP124 million off the value of the company, The Telegraph

The profits warning was the second from Debenhams in less than a
year, The Telegraph notes.  However, Mr. Sharp on Tuesday
insisted there was not a "fundamental flaw" in Debenhams
strategy, The Telegraph relays.  He blamed the profits warning on
weak consumer confidence and heavy discounting among fashion
retailers as they attempted to shift unsold winter clothing that
had built-up because of the mild autumn, The Telegraph relates.

Mr. Sharp also warned that a "final surge" in sales in the week
before Christmas had not materialized, The Telegraph recounts.

Debenhams' director of finance, Neil Kennedy, is to assume the
role of chief financial officer while the company searches for a
replacement, The Telegraph says.

Debenhams plc is a multinational retail chain operating under a
department store format in the United Kingdom and Ireland with
franchise stores in other countries.

GERALD DAVID: Owes Farmer GBP11,000
----------------------------------- reports that farmer Stephen Crossman
has spoken of his disappointment at losing GBP11,000 after
butcher chain Gerald David went into administration.  Stephen
Crossman from Withycombe supplied pigs to Mr David's shops.

It is reported that the firm, Gerald David and Family, had debts
of more than GBP1.68 million when it went into administration in
October, according to

The report notes that Mr. Crossman, who owns Court Place Farm, is
one of more than 100 trade creditors, who are rumored to be owed
at least GBP294,000 in total.

"We're disappointed on many fronts really - firstly that we've
lost the money and then also for his staff, who have been left
high and dry by this," the report quoted Mr. Crossman as saying.

The report notes that Mr. Crossman said that Mr. David had
recently assured him that things were going better for the
company and they had started to get things in order.

The report relates that so far, administrators, Kirks of Exeter
have only identified assets of around GBP68,000, meaning it is
unlikely that trade creditors will see anything back.

HIGGS CAPITAL: Faces Closure Following Investor Redemptions
Gregory Meyer at The Financial Times reports that a wave of
investor redemptions from commodities markets has claimed another
casualty as Higgs Capital Management announced Monday it plans to

According to the FT, people close to the fund said that staff of
12 managed about US$250 million in assets as of December 1, down
from US$340 million at Higgs' peak.

Higgs's performance was down about 0.5% in the 11 months to
Dec. 1 after a positive debut in 2012, the FT discloses.

Higgs joins several commodities funds in shutting their doors
this year, including Clive Capital, managed by Chris Levett, and
Arbalet Capital, launched in 2012 by Jennifer Fan, the FT relays.
Many surviving funds have seen their assets dwindle, reducing
management fees, the FT states.

The FT relates that in a letter to investors, Higgs said: "We
have taken this decision based on recent redemptions we have
received and general headwinds we face in commodity capital
raising.  Our lack of capital stability meant that although we
could have continued to manage capital into 2014 this would have
required a significant reduction in expenses along with a
restructuring of the fund."

Returns from trading in energy, metals and grains have paled next
to stock markets this year, while the wild commodity price swings
of years past have abated, the FT says.

The FT notes that people close to the fund said Higgs had been
included in a fund of hedge funds, which farms out money to
different managers and commodity trading advisers, and lost
assets as investors pulled money from that vehicle.

Higgs Capital Management is a London-based commodities fund,
named after the "God particle" of physics, was founded in
July 2012 by Neal Shear and Jean Bourlot, who long held senior
positions at Wall Street banks.

OSBORNE STATIONERS: In Administration, Calls in FRP Advisory
Express & Star reports that Osborne Stationers has shut three
stores and started closing down sales at 14 others after going
into administration.

Two others have been sold and discussions are ongoing over the
sale of another, according to Express & Star.

The report notes that employed 140 staff at the time directors
called in administrators from restructuring firm FRP Advisory
earlier this month.

The report relates that the company has struggled to survive
through tough trading conditions since the start of the downturn
in 2008.

Administrators said stores in Arnold and Sherwood, both in
Nottinghamshire, and Solihull, in Warwickshire, had been closed
before Christmas, the report notes.

The report discloses that two others, at Oadby in Leicestershire
and Newark in Nottinghamshire have been sold to Paperweights Ltd,
a company controlled by John Waits, a former owner of Osbornes,
saving ten jobs.

"Unfortunately further closures are inevitable in the new year,"
the report quoted Steven Stokes -- -
- partner at FRP Advisory, as saying.

The report discloses that the remaining outlets consist of seven
in Birmingham, two in Warwickshire, two in Leicestershire and
single shops in Bristol, Tewkesbury, Worcester and Daventry.

Talks over one site may result in the sale of one of the stores
in the Birmingham area, the report relays.

The Birmingham-based Osborne Stationers is a high street chain
founded nearly two centuries ago.  The firm, whose stores are
mostly in the Midlands, was founded as a printing business in
Birmingham city centre in 1832 by Edward Corn Osborne.

SKIPTON BUILDING: Moody's Changes Ratings Outlook to Stable
Moody's Investors Service has changed the outlook to stable from
negative on Skipton Building Society's ratings. At the same time
the society's ba1 standalone assessment, Ba1/Not-Prime deposit
and senior debt ratings, Ba2 subordinated and B1(hyb) junior
subordinated debt ratings have been affirmed.


The change in outlook of Skipton's ratings to stable from
negative reflects the society's recovering performance as shown
by 1) its stabilizing asset quality which, however, is still
considered weaker than some peers', 2) the increasing
profitability both in the consolidated business and in the core
Mortgages & Savings (M&S) business, and 3) the ongoing reduction
in organizational complexity. We view positively the progress
that Skipton has made in the last 1.5 years in improving
performance and divesting of certain loss-making subsidiaries
and/or businesses that didn't fit its strategic direction.

The affirmation of the ratings also reflects Skipton's
historically robust operating income, driven by the solid
performance of its estate agency business, its conservative
liquidity position and reliance on member deposits.

Moody's expects Skipton to deliver sustainable profitability in
the core M&S business supported by its disciplined underwriting
standards and stable margins. Despite recent improvements,
efficiency is still low and is heavily influenced by the
managerial and fixed costs associated with some of the principal
subsidiaries resulting in a weak cost-income ratio of 80.5% in
the first six months of 2013.

Although most of the subsidiaries are related to the core retail
business, Moody's believes that the strategy of holding numerous
separate businesses increases Skipton's operational complexity
and consequently its overall risk profile, putting greater
stretch on management. This operational complexity exposes the
society to risks beyond credit risk such as conduct-related
risks. These factors remain constraints on Skipton's rating
levels. We note, however that management has established a
division ("Investment Portfolio") which includes subsidiaries
that do not fall into the society's core operations and has
disposed of subsidiaries which had not been profitable or were
not sufficiently aligned to its core businesses.


Difficulties at one of Skipton's major subsidiaries, leading to a
drain on resources (either financial or managerial) away from the
core lending franchise might exert downward pressure on the
standalone assessment. Any material deterioration in asset
quality and profitability would have the same impact.

Skipton will be challenged to obtain a higher standalone
assessment given its high reliance on non-lending subsidiaries.
Upward ratings pressure could come from a track record of
sustainable profitability at both the lending and non-lending
subsidiaries. However, in the near term this might be constrained
by the current low interest-rate environment and the weak albeit
stabilizing economic growth in the UK.

The principal methodology used in these ratings was Global Banks
published in May 2013.

Herald Scotland reports that SmartOffice Technologies, a software
company once considered to be one of Scotland's brightest
technology prospects, went in to insolvency owing almost
GBP533,000 to the tax authorities.

Documents filed by administrators of Paisley-based SmartOffice
Technologies, which uses technology developed by Picsel, show Her
Majesty's Revenue and Customs was its largest creditor when it
went into administration in September, Herald Scotland relates.

The statement of affairs and administrator's proposals were
prepared by Brian Milne and Linda Barr from French Duncan and
have been filed at Companies House, according to Herald Scotland.

The documents outline the dozens of other businesses which were
owed money by SmartOffice, the report relays.

Herald Scotland relates that among the creditors, financial
adviser Trident (Scotland) was due more than GBP31,000,
accountant Hardie Caldwell GBP13,250, recruitment firm Eden Scott
more than GBP8,000, telecoms supplier Abica in excess of
GBP13,000 and accountancy firm Haines Watts around GBP6,300.

The Redundancy Payments Office, which is part of The Insolvency
Service, was owed more than GBP158,000.

Former employees were also named with Imran Khand, who resigned
as a director in August this year, owed around GBP89,000 in
expenses, director Majid Anwar due GBP21,000 and Elaine McLardy
listed as having GBP8,138 of outstanding expenses, Herald
Scotland relays.

The unsecured creditors' bill was just short of GBP1 million, the
report discloses.

As reported in the Troubled Company Reporter-Europe on Sept. 25,
2013, Business7 said SmartOffice Technologies has entered into
administration.  Provisional liquidators Brian Milne and Linda
Barr of French Duncan, have been appointed to parent company
Picsel International Ltd., based in Malta, Business7 related.
Messrs. Milne and Barr have also been appointed as joint
administrators to subsidiary SmartOffice Technologies, which
employs 31 staff in Paisley and six in Asia, Business7 disclosed.

Paisley-based SmartOffice Technologies develops document viewing
and editing solutions for mobile devices.

WASABI ENERGY: Goes Into Voluntary Administration
Alliance News reports that Wasabi Energy Ltd said the company has
been put into voluntary administration following a review of its
financial position.

The company appointed John Lindholm -- --
and Stewart McCallum -- -- of Ferrier
Hodgson as administrators of Wasabi.

The report notes that Wasabi's shares were suspended on Dec. 23
after it failed to raise enough funds to pay off AU$8 million of
outstanding loan notes, or to fund its purchase of the Tuzla
Geothermal Power Project in Turkey.

On November 27, Wasabi said it wanted to raise up to US$14.8
million through a rights issue to complete the purchase of the
Tuzla Project, as well as pay off its debt and provide working
capital, the report discloses.

The report relays that Wasabi said on December 24, that the
shortfall on its rights issue totaled AU$13.8 million, managing
to raise only AUD1.0 million, or 6.5% of the company's shares on
offer, and that it was holding discussions with note holders
about how to repay the notes.

The company has now voluntarily gone into administration and said
it is committed to working with the administrators in order to
determine the future of Wasabi and will provide a further update
to shareholders shortly, the report adds.

Wasabi Energy Ltd is a renewable and clean-energy technology

ZLOMREX: Jan. 8 Meeting Set to Approve Scheme of Arrangement

Notice is hereby given that by order made on November 26, 2013,
Zlomrex International Finance S.A. (ZIF) was granted permission
by the High Court of Justice of England and Wales, under Part 26
of the Companies Act 2006, to convene a meeting of "Note
Creditors", being those persons with a beneficial interest in the
notes issued under the indenture dated January 29, 2007 (as
amended) in order for those Note Creditors to consider, and if
thought fit, approve a scheme of arrangement proposed by ZIF.
The Court granted ZIF permission to convene a single meeting of
the Note Creditors for the purposes of voting in favor or against
the Scheme.

In order to become effective, the Scheme must be approved by a
majority in number representing not less than 75% by value of
those Note Creditors who vote at the Scheme Meeting.

By the said Order, the Court has appointed Krzysztof Zola of ZIF
or failing him, David Manson of White & Case LLP, to act as
chairman of the Scheme Meeting and has directed the chairman to
report the result of the Scheme Meeting to the Court.

The Court will be subject to the subsequent approval of the

Each Note Creditor is entitled to attend and vote for or against
the Scheme at the Scheme Meeting, either in person or by proxy.
Details on how to vote or appoint a proxy are also set out in the
Scheme Documents referred to below.  If you are unsure whether
you are a Note Creditor please contact Lucid Issuer Services
Limited acting as "Information Agent" on behalf of ZIF whose
details are set out below.

Note Creditors should immediately contact their "Account Holder"
(through an intermediary, if appropriate) to ensure that a valid
"Account Holder Letter" is submitted in respect of their

Each Note Creditor will need to give its Account Holder
instructions as to voting.  Note Creditors should note, however,
unless a valid Account Holder Letter is delivered on or before
5:00 p.m. (London time) on January 7, 2014, the voting
instructions contained in the Account Holder Letter will be
disregarded for the purposes of voting at the Scheme Meeting and
the Note Creditor will not be able to vote at the Scheme Meeting.

The Scheme Meeting will be held on January 8, 2014 at the offices
of White & Case LLP at 5 Old Broad Street, London EC2N 1DW at
11:00 a.m. (London time).

Copies of the documents related to the Scheme of Arrangement,
including the explanatory statement required by section 897 of
the Companies Act 2006 and the Account Holder Letter are
available to be downloaded at  The
Scheme Documents will also be made available to the Note
Creditors by the Information Agent.

Note Creditors who have questions regarding the proposed Scheme
Documents or who require any further information regarding the
proposed Scheme may contact the Information Agent at
Lucid Issuer Services Limited, Leroy House, 436 Essex Road,
London, N1 3QP; (Attention: David Shilson/Paul Kamminga).

Telephone: +44 (0)20 7704 0880
Fax: +44(0)20 7067 9098

White Case LLP, 5 Old Broad Street, London EC2N 1DW
Solicitors to Zlomrex International Finance S.A.

* UK: Number of Retail Sector Administrations Down 6% in 2013
------------------------------------------------------------- reports that the number of retailers going into
administration during 2013 fell by 6% overall compared to the
year before though there was a marked upturn during the final
quarter of the year.

Research from business advisory firm Deloitte found 183 retailers
entered administration over the last 12 months compared with 194
in 2012, discloses.

High street firms were thought to be benefiting from being left
standing after the collapse of rivals, notes.

But the last three months of the year saw an increase of 11%
compared to the previous fourth quarter -- from 37 to 41, relays.

Lee Manning, restructuring services partner at Deloitte, as cited
by, said: "The high street has undergone a re-
balancing, and this is what is being reflected by these figures.

"A year ago we were about to see HMV, Blockbuster and Jessops
enter administration, but I would not expect as many high-profile
retail casualties this time round.

"This does not mean demand is increasing, more that the clear-out
will benefit those still standing in 2014."

In total, 1,629 businesses went into administration in 2013, 11%
down from the figure of 1,833 seen the previous year, discloses.

Almost all sectors tracked in the analysis saw a decline in the
number of business failures -- including a 24% fall in property
and construction, and a 4% decrease among manufacturing firms, states.

* UK: Twenty Scottish Firms to Go Bust Every Week This Year
Peter Ranscombe at The Scotsman reports that twenty Scottish
businesses are forecast to go bust each week this year as the
nation continues to struggle under a mountain of historic debt.

Many companies are only managing to service the interest on their
debts rather than paying off the money they owe, The Scotsman
discloses.  This leaves firms in a precarious situation if
interest rates begin to rise, as they will be unable to meet
their repayments, The Scotsman notes.

According to The Scotsman, Bryan Jackson, a partner at
accountancy firm BDO, which made the predictions, said:
"Worryingly, many businesses are simply paying interest on debts
that are never reduced.

"A rise in interest rates, reduced income, or a change in the
marketplace and these businesses will collapse.

"About 20 businesses a week will have gone bust during 2013 and I
would expect a similar figure or perhaps even higher for the
coming year."

* UK: Number of Zombie Companies Down in November, R3 Says
Kate Burgess at The Financial Times reports that the battalions
of corporate walking dead are disappearing, say insolvency
practitioners, with some being restored to health but others
moving closer to insolvency.

According to the FT, R3, the insolvency trade body, said that the
so-called zombie companies that can do little more than pay the
interest on their loans have sunk to new lows.

It classed 103,000 UK businesses as zombies in November, about 6%
of companies with a turnover of at least GBP50,000, down by more
than a third from the peak of 160,000 in November 2012, the FT

R3 says its figures suggest that some companies may have been
able to work their way out of their difficulties and back to
health, the FT relays.  About 96,000 companies told the
insolvency body that they would not be able to repay debts if
interest rates rose, according to the FT.  That is slightly up on
November 2012 but well off their peak of 145,000 in June last
year, the FT notes.

The number of companies that say they are struggling to repay
debts when they fall due has also halved in the past year to
about 56,000, the FT states.

At the same time, says R3, there has also been a sharp rise in
the number of companies having to negotiate payment terms with
their creditors, the FT discloses.  The FT relates that
Ric Traynor, chairman of Begbies Traynor, last month said he had
seen an increase in informal discussions between banks and
borrowers.  R3 calculates that, in November, 166,000 companies
were negotiating terms with their lenders, against 75,000 the
year before, the FT relays.  That may mean that a number of
companies have moved a step further towards insolvency, the FT

The rise of zombie companies, which would have failed in previous
recessions, has been a mark of the recent downturn, the FT
states.  According to the FT, these are the companies that have
been kept going by ultra-low interest rates and the forbearance
of creditors.

The rate of corporate liquidations, both compulsory and
voluntary, is far lower than levels reached in earlier
recessions, the FT says.

According to the FT, while some insolvency practitioners say the
survival of zombies has helped to protect jobs, it has also held
back recovery by hampering the expansion of healthier companies.


* BOOK REVIEW: Creating Value through Corporate Restructuring
Author: Stuart C. Gilson
Publisher: Wiley
Hardcover: 516 pages
List Price: $79.95
Review by David M. Henderson

Most business books fall into two categories. The first is very
important. It is like that stuff you have to drink before you
have a colonoscopy. You keep telling yourself, this is very
good for me, while you would rather be at the beach reading
Liar's Poker or Barbarians at the Gate.

Stuart Gilson, of the Harvard Business School, has managed to
write a book important to everybody in the distressed market
that is also quite enjoyable. His prose is fluid and succinct
and a pleasure to read. But don't take my word for it. The
dust jacket endorsements come from Jay Alix, Martin Fridson,
Harvey Miller, Arthur Newman, and Sanford Sigoloff. At a
collective gazillion dollars a billing hour, that's a lot of

Be advised that this is designed as a text book. The case study
format might be off-putting to some. The effect can be jarring
as you read the narrative history of the case and suddenly
confront the financial statements without any further clue as to
what to do, but this must be what it is like for the turnaround
manager. Even after reading several of the cases, when I got to
the financials I had that sinking feeling of, what do I do now?
If you read carefully, clues to the solutions are in the

The book is divided into three "modules", bizspeek for sections:
Restructuring Creditors' Claims,. Restructuring Shareholders'
Claims, and Restructuring Employees' Claims. The text covers 13
corporate restructurings focusing on debt workouts, vulture
investing, equity spinoffs, tracking stock, assete divestitures,
employee layoffs, corporate downsizing, M & A, HLTs, wage
givebacks, employee stock buyouts, and the restructuring of
employee benefit plans. That's a pretty comprehensive survey,
wouldn't you say? Dr. Gilson's chapter on "Investing in
Distressed Situations" is an excellent summary of the distressed
market and a good touchstone even for seasoned vultures.

Even in the two appendices on technical analysis, this book is
marvelously free of those charts and graphs that purport to show
some general ROI of distressed investing. Those are cute,
aren't they? As Judy Mencher has famously said, "You can buy
the paper at 50 thinking it's going to 70, but it can just as
easily go to 30 if you are not willing to act on it." Therein
lies the rub and the weakness, if inevitable, of this or any
book on corporate restructurings. As Dr. Gilson notes, no two
are alike, and the outcome is highly subjective, in our out of
Court, but especially in Chapter 11. Is the Judge enthralled by
Jack Butler as Debtor's Counsel or intimidated by Harvey Miller
as Debtor's Counsel? Are you holding "secured" paper only to
discover that when it was issued the bond counsel forgot to
notify the Indenture Trustee of the most Senior debt? Is
somebody holding Junior paper that you think is out of the money
only to have Hugh Ray read the fine print and discover that the
"Junior" paper is secured? This is the stuff of corporate
reorganizations that is virtually impossible to codify into a

That said, this is an especially valuable text for anybody
working in the distressed market. As a Duke grad, I tend to be
disdainful of all things Harvard, but having read Dr. Gilson's
book, I am enticed to encamp by the dirty waters of the Charles
long enough to take his course, appropriately entitled,
"Creating Value Through Corporate Restructuring."


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, and Peter A. Chapman,

Copyright 2014.  All rights reserved.  ISSN 1529-2754.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.

Information contained herein is obtained from sources believed to
be reliable, but is not guaranteed.

The TCR Europe subscription rate is US$775 per half-year,
delivered via e-mail.  Additional e-mail subscriptions for
members of the same firm for the term of the initial subscription
or balance thereof are US$25 each.  For subscription information,
contact Peter Chapman at 215-945-7000 or Nina Novak at

                 * * * End of Transmission * * *