TCREUR_Public/140117.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 17, 2014, Vol. 15, No. 12

                            Headlines

G E R M A N Y

TUI AG: Moody's Upgrades Corporate Family Rating to B2


G R E E C E

GREECE: Slim Parliamentary Majority May Hamper Economic Reforms


I R E L A N D

HARVEST CLO III: Moody's Lifts Ratings on Two Note Classes to Ba2
PERMANENT TSB: Expects 10% Return on Equity for Good Bank Unit
QUIRINUS PLC: S&P Lowers Rating on Class F Notes to 'D'
SIAC CONSTRUCTION: Bouygues-Led Consortium Set to Take Over
TALISMAN-6 FINANCE: Moody's Lowers Rating on EUR825MM Notes to B1


L U X E M B O U R G

ATENTO LUXCO: Fitch Affirms 'BB' IDR; Outlook Stable
EURO FREIGHT: Moody's Lowers Rating on EUR273MM Notes to 'Ba1'
S&B MINERALS: Moody's Assigns 'B3' CFR; Outlook Remains Stable


N E T H E R L A N D S

CADOGAN SQUARE: S&P Affirms 'B+' Rating on Class E Notes
VTR FINANCE: Moody's Assigns B1 CFR & Rates New US$1.4BB Bonds B1


P O L A N D

POLIMEX-MOSTOSTAL: Won't Complete Construction of A1/A4 Highways


R O M A N I A

OLTCHIM SA: Jan. 31 Bid Deadline Set for Oltchim SPV Stake
PIC ORADEA: Western Logistics Acquires Business


R U S S I A

RUSSNEFT OJSC: S&P Affirms 'B' CCR & Removes Rating from Watch


U N I T E D   K I N G D O M

JAMES BALFOUR: Cash Flow Constraints Prompt Administration
MERGERMARKET GROUP: Moody's Assigns B3 Corporate Family Rating
SAMNUGGUR JUTE: Hooley Challenges Administrator's Actions
YALES LEISURE: Unsecured Creditors May Not Recover Claims


X X X X X X X X

* EUROPE: Draft Rejects Automatic Separation of Bank Activities
* BOOK REVIEW: The Phoenix Effect


                            *********


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G E R M A N Y
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TUI AG: Moody's Upgrades Corporate Family Rating to B2
------------------------------------------------------
Moody's Investors Service has upgraded to B2 from B3 the
corporate family rating (CFR) and from B3-PD to B2-PD the
probability of default rating (PDR) of TUI AG (TUI).
Concurrently, Moody's has raised TUI AG's senior unsecured rating
and the junior subordinated ratings to B3 from Caa1, and to Caa1
from Caa2, respectively.  In addition, the rating agency has
changed the outlook on the ratings to stable from positive.

Ratings Rationale

"The rating action reflects our view that TUI AG's stable
earnings profile, largely underpinned by the TUI Travel PLC
subsidiary, has enabled the group to retain its key leverage
metric, as adjusted by Moody's, close to 6x, which is within the
target range that we had indicated for a potential upgrade," says
Richard Morawetz, a Moody's Vice President -- Senior Credit
Officer and lead analyst for TUI AG.

The adjusted leverage metric was fairly unchanged year-on-year,
supported by a slight increase in reported underlying EBITA.
While reported net debt fell marginally in the year (EUR68
million from EUR178 million), Moody's notes that gross debt and
cash actually increased as a result of the amended accounting
treatment of a cash pooling agreement in the course of FY2013,
which resulted in reported debt and cash increasing by EUR588
million and EUR570 million, respectively, without which the
Moody's-adjusted leverage metric would be somewhat lower.

While Moody's continues to view the tourism operations as prone
to disruptions, for example as reported by the company in North
Africa in FY2013, TUI AG's key subsidiary, TUI Travel PLC, has
proven resilient in recent years.  Moody's also notes TUI AG's
own forecast for 6%-12% growth in underlying group EBITA in
FY2014, largely attributable to TUI Travel PLC (7%-10% growth
forecast) and stable net debt for the group.  These remain
subject to the political environment and exchange rates, but --
in the rating agency's view -- should be supported by a modest
improvement in underlying economic growth expected in the euro
area.  Moody's would expect this to modestly benefit earnings and
metrics in the current fiscal year.  Within the context of the
group's 'one TUI' performance improvement and vertical
integration strategy, the group's financial targets are to (i)
achieve underlying EBITA of around EUR1 billion by FY2015 (versus
EUR762 million reported in FY2013); (ii) improve net cash flow at
holdco to approximately EUR100 million in that year; and (iii)
pay a dividend of around 50% of net cash flow at TUI AG.  In this
regard, the company is proposing to pay its first dividend at
holdco since 2008 in February 2014 (15c per share, or
approximately EUR38 million).

The B2 CFR reflects TUI's leading market positions in its core
tourism segment, with earnings that have remained quite resilient
in spite of operating in a sector that is highly dependent on
discretionary spending.  In Moody's view, TUI AG's diminished
financial exposure to Hapag-Lloyd AG (B2 negative) has also
reduced its exposure to that company's earnings, which have been
more volatile in the past.  Moody's would nevertheless expect
that over time TUI AG will receive some proceeds when it fully
divests its stake in Hapag-Lloyd AG.  Finally, the CFR is
supported by TUI AG's liquidity, which is deemed sufficient
beyond a 12-month horizon.  The rating remains constrained by the
still fairly high leverage metric as of FYE2013, and MOODY'S's
expectation that any improvement in the current year is likely to
be modest.  In addition, the rating is constrained by the
relative complexity of the group structure, and uncertainty about
the future strategy in this regard.  While Moody's note the
significant market value of TUI AG's stake in TUI Travel PLC,
which remains a key strategic asset, Moody's also notes that it
remains a separately-listed legal entity and as such our view is
that TUI AG retains limited access to subsidiary cash flows.

Moody's believes that TUI AG's liquidity position is currently
satisfactory.  At the holding company level, the reported cash
balance of EUR506 million as of September 2013 was sufficient to
meet debt maturities to the end of 2015.  At the same time,
Moody's continues to note that the holding company generates
minimal cash, namely dividends from TUI Travel PLC and from the
hotel business.  As such, if the convertible bonds maturing in
2016 (EUR339 million) are not converted, the holding company
would likely need to secure additional financing.  However,
Moody's further notes that TUI AG maintains its target to
monetise its 22% stake in Hapag-Lloyd AG, which should provide
some additional liquidity flexibility.  Finally, Moody's notes
that TUI Travel PLC increased its credit facilities to GBP1.4
billion in total and maturing in June 2015, which were undrawn as
of September 2013, except for GBP0.1 billion, and a back-up
bridge facility of GBP300 million which will enable it to repay
its GBP350 million convertible bond maturing in October 2014, if
necessary.

Outlook

The stable outlook reflects Moody's view that, barring any
structural event, the key adjusted leverage metric will remain
fairly stable, and potentially improve if the company's earnings
goals are achieved.  The metric could further benefit if funds
from an eventual divestment of the stake in Hapag-Lloyd AG are
applied to debt reduction.

What Could Change The Rating Up/Down

At this time, further upward pressure on the rating is limited by
the relative complexity of the group structure and uncertainty
surrounding corporate strategy.  Moody's would consider further
upward pressure on TUI AG's rating if the group's gross adjusted
leverage were to fall towards 5.5x, with the group retaining
significant cash balances to address pending debt maturities.  In
particular, any material cash proceeds from divestitures used for
debt reduction could be positive for the rating or outlook.
While not currently expected in view of the rating action, the
rating could be lowered if the leverage metric were to trend
towards 7x, or if the group, and the holding company in
particular, were unable to maintain adequate liquidity beyond a
12-month horizon.

Principal Methodology

TUI AG's ratings were assigned by evaluating factors that Moody's
considers relevant to the credit profile of the issuer, such as
the company's (i) business risk and competitive position compared
with others within the industry; (ii) capital structure and
financial risk; (iii) projected performance over the near to
intermediate term; and (iv) management's track record and
tolerance for risk.  Moody's compared these attributes against
other issuers both within and outside TUI AG's core industry and
believes TUI AG's ratings are comparable to those of other
issuers with similar credit risk.

TUI AG, headquartered in Hanover, Germany, is Europe's largest
integrated tourism group, and currently retains a 22% stake in
Hapag-Lloyd AG, which is a leading provider of container shipping
services.  In FY2013 (to September), TUI AG reported revenues and
underlying EBITA from continuing operations of EUR18.5 billion
and EUR762 million, respectively.



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G R E E C E
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GREECE: Slim Parliamentary Majority May Hamper Economic Reforms
---------------------------------------------------------------
Peter Spiegel and Kerin Hope at The Financial Times report that
Greece's finance minister says his government's shrinking
parliamentary majority has made it increasingly difficult to pass
tough economic reform measures and called on the "troika" of
international bailout lenders to be more realistic in its demands
of Athens.

Yannis Stournaras, who has been waging a four-month battle with
bailout monitors over whether Greece is living up to the terms of
its EUR172 billion international rescue, said while Athens can
continue to implement existing reforms -- including better tax
collection -- ambitions for major legislative measures may need
to be scaled back, the FT relates.

"The majority is very slim.  So we have to be very careful,"
Mr. Stournaras said in an interview with the FT, referring to the
153 seats the government controls in Greece's 300-member
parliament.  "There are things that can be done and things that
cannot be done."

According the FT, he was particularly critical of the troika's
negotiating style, accusing top negotiators -- from the
International Monetary Fund, European Central Bank and European
Commission -- of adopting "a maximalist approach" when in Athens
that spooked both financial markets and domestic companies, and
was risking the country's nascent economic recovery.

The Greek government had hoped to resolve the current review of
its bailout program before its turn at the EU's six-month
rotating presidency began last week, the FT notes.  The exercise
was originally due to be completed in September last year, the FT
states.

But differences with the troika over a 2014 budget gap and
unfinished economic reforms have dragged the review into the new
year and soured relations to a degree not seen since the height
of the crisis, according to the FT.

The FT relate that senior troika officials said the two sides are
close to a deal on the budget gap, in which Athens has agreed to
raise an additional EUR1 billion.  But they remain far apart on
structural reforms, with troika officials insisting Athens has
implemented less than half of the measures they were supposed to
in 2013, the FT says.

According to the FT, Mr. Stournaras acknowledged Greece's
"compliance ratio is still low", but insisted many of the
remaining reforms could be done through administrative acts
rather than legislation.



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I R E L A N D
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HARVEST CLO III: Moody's Lifts Ratings on Two Note Classes to Ba2
-----------------------------------------------------------------
Moody's Investors Service has upgraded the ratings on the
following notes issued by Harvest CLO III plc:

   -- EUR77 million Class B Senior Floating Rate Notes due 2021,
      Upgraded to Aa1(sf); previously on Jul 19, 2011 Upgraded
      to Aa3(sf);

   -- EUR30.75 million Class C-1 Senior Subordinated Deferrable
      Floating Rate Notes due 2021, Upgraded to A2(sf);
      previously on Jul 19, 2011 Upgraded to Baa1(sf);

   -- EUR12 million Class C-2 Senior Subordinated Deferrable
Fixed
      Rate Notes due 2021, Upgraded to A2(sf); previously on
      Jul 19, 2011 Upgraded to Baa1(sf);

   -- EUR16.75 million Class D-1 Senior Subordinated Deferrable
      Floating Rate Notes due 2021, Upgraded to Baa3(sf);
      previously on Jul 19, 2011 Upgraded to Ba1(sf);

   -- EUR9.25 million Class D-2 Senior Subordinated Deferrable
      Fixed Rate Notes due 2021, Upgraded to Baa3(sf); previously
      on Jul 19, 2011 Upgraded to Ba1(sf);

   -- EUR15.75 million Class E-1 Senior Subordinated Deferrable
      Floating Rate Notes due 2021, Upgraded to Ba2(sf);
      previously on Jul 19, 2011 Upgraded to Ba3(sf);

   -- EUR3 million Class E-2 Senior Subordinated Deferrable Fixed
      Rate Notes due 2021, Upgraded to Ba2(sf); previously on
      Jul 19, 2011 Upgraded to Ba3(sf);

   -- EUR10 million (current rated balance of EUR5.6M) Class V
      Combination Notes due 2021, Upgraded to Baa2(sf);
      previously on Jul 19, 2011 Upgraded to Ba1(sf)

Moody's Investors Service has affirmed the ratings on the
following notes issued by Harvest CLO III plc:

   -- EUR425 million (current rated balance of EUR359.3M) Class A
      Senior Floating Rate Notes due 2021, Affirmed Aaa(sf);
      previously on Apr 25, 2006 Assigned Aaa(sf)

Harvest CLO III plc, issued in April 2006, is a collateralized
loan obligation (CLO) backed by a portfolio of mostly high-yield
senior secured European loans.  The portfolio is managed by 3i
Debt Management Investments Ltd.  The transaction's reinvestment
period ended in June 2013.

Ratings Rationale

According to Moody's, the rating actions taken on the notes
result from an improvement in credit metrics of the underlying
portfolio and also the benefit of modeling actual credit metrics
following the expiry of the reinvestment period in June 2013.
The credit quality has improved as reflected in the improvement
in the average credit rating of the portfolio (measured by the
weighted average rating factor, or WARF).  As of the November
2013 report, the WARF was 2735, compared with 2919 in November
2012 and 2895 at the time of the last rating action in July 2011.
The weighted average spread also increased to 4.04% in November
2013, compared with 3.71% in November 2012 and 3.17% of the last
rating action in July 2011.

In consideration of the reinvestment restrictions applicable
during the amortization period, and therefore the limited ability
to effect significant changes to the current collateral pool,
Moody's analyzed the deal assuming a higher likelihood that the
collateral pool characteristics will continue to maintain a
positive buffer relative to certain covenant requirements.  In
particular, the deal is assumed to benefit from a shorter
amortization profile and higher spread levels compared to the
levels assumed at the last rating action in July 2011.

The rating on the combination notes addresses the repayment of
the rated balance on or before the legal final maturity.  For the
Class V notes, the 'rated balance' at any time is equal to the
principal amount of the combination note on the issue date times
a rated coupon of 2.00% per annum accrued on the rated balance on
the preceding payment date, minus the sum of all payments made
from the issue date to such date, of either interest or
principal. The rated balance will not necessarily correspond to
the outstanding notional amount reported by the trustee.

The key model inputs Moody's uses in its analysis, such as par,
weighted average rating factor, diversity score and the weighted
average recovery rate, are based on its published methodology and
could differ from the trustee's reported numbers.  In its base
case, Moody's analyzed the underlying collateral pool as having a
performing par and principal proceeds balance of EUR463.1 million
(EUR37.1 million of non-Euro obligations hedged via perfect
assets swaps) and GBP62.8 million, defaulted par of EUR3.0
million, a weighted average default probability of 22.19% over
4.85 years weighted average life (consistent with a 10 year WARF
of 2951), a weighted average recovery rate upon default of 46.01%
for a Aaa liability target rating, a diversity score of 44 and a
weighted average spread of 4.04%.  The GBP denominated assets are
fully hedged with a macro swap, which Moody's also modelled.

In its base case, Moody's addresses the exposure to obligors
domiciled in countries with local currency country risk bond
ceilings (LCCs) of A1 or lower.  Given that the portfolio has
exposures to 10.6% of obligors in Italy, Ireland, and Spain,
whose LCC are A3, A3 and A2, respectively, Moody's ran the model
with different par amounts depending on the target rating of each
class of notes, in accordance with Section 4.2.11 and Appendix 14
of the methodology.  The portfolio haircuts are a function of the
exposure to peripheral countries and the target ratings of the
rated notes, and amount to 0.26% for the Class A notes, 0.17% for
the Class B notes and 0.07% for the Class C notes.

The default probability derives from the credit quality of the
collateral pool and Moody's expectation of the remaining life of
the collateral pool.  The estimated average recovery rate on
future defaults is based primarily on the seniority of the assets
in the collateral pool.  For a Aaa liability target rating,
Moody's assumed that a recovery of 50% of the 88.6% of the
portfolio exposed to first-lien senior secured corporate assets
upon default and of 15% of the remaining non-first-lien loan
corporate assets upon default. In each case, historical and
market performance and a collateral manager's latitude to trade
collateral are also relevant factors. Moody's incorporates these
default and recovery characteristics of the collateral pool into
its cash flow model analysis, subjecting them to stresses as a
function of the target rating of each CLO liability it is
analyzing.


PERMANENT TSB: Expects 10% Return on Equity for Good Bank Unit
--------------------------------------------------------------
John Mulligan at Irish Independent reports that Permanent TSB has
forecast a 10% return on equity for its good bank unit by 2017
under a plan to return it to private ownership.

In a presentation to investors, the state-owned institution said
it aimed to deliver a 5% return on equity by 2017 when its
distressed mortgages were included in the arithmetic, Irish
Independent relates.

It told investors that Ireland's economy was improving, with
positive signals from the property and jobs markets,
Irish Independent relays.

The bank confirmed last October that it expected to return to
profitability by 2017, Irish Independent notes.

In the first half of 2013, Permanent TSB made a pre-tax loss of
EUR131 million compared with a loss of EUR587 million in the
first half of 2012, Irish Independent discloses.

The presentation given to investors last week confirmed Permanent
TSB plans to return the good portion of its bank to full or
partial market ownership by 2017, Irish Independent recounts.

The good portion of the bank has about EUR15 billion of loans and
the marketing process could kick off in the second half of this
year, Irish Independent states.

Permanent TSB is headed by Jeremy Masding.  He had considered
closing the business but he and the board believed the "least
worst" option was to keep it going, Irish Independent notes.

The Irish taxpayer injected EUR4 billion into Permanent TSB to
keep it afloat following the property crash, Irish Independent
recounts.  Since then, its Irish Life arm was sold for EUR1.3
billion, Irish Independent relays.

According to Irish Independent, Permanent TSB is hoping to gain
approval by April from the European Union for its restructuring
plan.  Mr. Masding had hoped last summer that the plan would have
been approved by the end of 2013, Irish Independent relates.

The bank was the country's biggest mortgage lender before the
bust, Irish Independent states.

Permanent TSB is formerly Irish Permanent and TSB bank.


QUIRINUS PLC: S&P Lowers Rating on Class F Notes to 'D'
-------------------------------------------------------
Standard & Poor's Ratings Services lowered to 'D(sf)' from
'CC(sf)' its credit rating on Quirinus (European Loan Conduit No.
23) PLC's class F notes.

Following the liquidation of the Fairacre loan, a non-accruing
interest (NAI) shortfall amount was applied to the class F notes
on the August 2013 interest payment date (IPD).  Given the NAI
amount outstanding, the class F notes only received interest on
the portion of the class F notes' balance not subject to a NAI on
the November 2013 IPD.  As such, the class F notes has not
received its full interest payment, in S&P's view.

S&P's ratings on Quirinus (European Loan Conduit No. 23)'s notes
address the timely payment of interest quarterly in arrears, and
the payment of principal no later than the legal final maturity
date in February 2019.

The rating action on the class F notes reflects S&P's view that
given the NAI amount outstanding, the class F notes has
experienced an interest shortfall, which S&P believes will likely
continue to increase on future IPDs.  S&P also expects a
principal loss on the class F notes at legal final maturity.  S&P
has therefore lowered to 'D (sf)' from 'CC (sf)' its rating on
the class F notes.

Quirinus (ELOC 23) is a 2006-vintage true sale commercial
mortgage-backed securities (CMBS) transaction that reaches legal
final maturity in February 2019.


SIAC CONSTRUCTION: Bouygues-Led Consortium Set to Take Over
-----------------------------------------------------------
The Irish Times reports that a consortium backed by French giant,
Bouygues, looks poised to take over troubled building group,
Siac, after the original preferred bidder for the company,
businessman Brian Harvey, decided against going ahead with an
offer.

The High Court appointed Michael McAteer of Grant Thornton as
examiner to Siac and eight related companies late last year,
giving them protection from creditors, including three banks owed
EUR42 million, The Irish Times relates.

It is understood that a consortium made up of French group,
Bouygues and involving Siac's owners, the Feighery family, is
likely to take the business out of examinership this month at a
cost of between EUR12 million and EUR13 million, The Irish Times
notes.

According to The Irish Times, the move is likely to secure the
group's core construction and engineering contracting operations
and the 200-plus jobs that they support.

The Feighery family will have a minority holding in the rescued
business, The Irish Times states.

Siac went into examinership owing EUR42 million to three banks,
KBC, Bank of Scotland and Bank of Ireland and a further EUR26
million unsecured creditors, The Irish Times recounts.

Part of its problems stemmed from road building ventures in
Poland which the company said became mired in problems with the
local authorities responsible for managing the projects there,
The Irish Times relays.

SIAC Construction is an Irish building engineering company.


TALISMAN-6 FINANCE: Moody's Lowers Rating on EUR825MM Notes to B1
-----------------------------------------------------------------
Moody's Investors Service has downgraded the rating of the Class
A Notes issued by TALISMAN-6 FINANCE P.L.C. (amount reflects
initial outstandings).  Moody's rating action is as follows:

Issuer: TALISMAN-6 FINANCE P.L.C.

* EUR825M A Notes, Downgraded to B1 (sf); previously on
   Apr 18, 2011 Downgraded to Ba2 (sf)

Moody's does not rate the Class B, C, D, E, F and X Notes.

Ratings Rationale

The downgrade action reflects Moody's increased loss expectation
for the pool since its last review due to (1) further actual and
expected value declines for 55% of the pool by loan balance; and
(2) a substantial number of mostly secondary quality properties
need to be sold within a remaining short tail period (2.8 years),
in some cases involving complex loan workouts.

Moody's Portfolio Analysis

TALISMAN-6 FINANCE P.L.C. closed in April 2007 and represents the
securitization of initially nine commercial mortgage loans
originated by ABN AMRO Bank N.V.  Currently seven loans remain in
the pool and the loans are secured by first-ranking legal
mortgages over 224 commercial and multi-family properties.  The
Kiwi loan was worked out without a loss in January 2012 while the
Strawberry Loan repaid in January 2013.  The pool exhibits an
above average concentration in terms of geographic location (100%
in Germany) and property type (51% retail, based on UW market
value).  Moody's uses a variation of Herf to measure diversity of
loan size, where a higher number represents greater diversity.
Large multi-borrower transactions typically have a Herf of less
than 10 with an average of around 5.  This pool has a Herf of
4.0, lower than at Moody's prior review.

Large losses will be realized on the Cherry Loan (4.8% of the
pool) which was secured by 11 multi-family properties at closing.
The remaining seven properties were sold in October 2012 and the
servicer expects that insolvency procedures will be finalized
during this year.  Of the EUR23.55 million net sales proceeds,
EUR18.2 million was allocated to the Notes resulting in a 68%
loss on the loan. Quarterly expenses of the insolvency
administrator and interest payment on the loan in some quarters
are financed from the EUR2.4 million of cash that was retained by
the insolvency administrator following the property disposals.
The cause of the delay in closing the insolvency proceedings is
mainly due to the ongoing process of collecting rent arrears, in
many cases by way of legal proceedings.

All the loans are in default and in special servicing.  Based on
Moody's revised assessment of underlying property values, the
loss expectation for the remaining pool (excluding the Cherry
Loan) is large (25%-40%).

The largest loan in the portfolio, the Orange Loan (43% of the
pool and with a EUR 360 million securitized balance) is secured
by 149 properties which are mainly retail boxes, grocery stores
and some high street shops.  Moody's main concern with respect to
the loan is that sponsor is trying to block the work-out process.
Insolvency proceedings have been opened and insolvency
administrators have been appointed, however the sponsor has
raised objections against the proceedings in Germany.  Given the
large number of mostly secondary quality assets that have to be
sold and that the disposal process continues to be delayed by the
legal wrangling, it will be challenging to conclude the work-out
ahead of the legal final of the Notes.

The vacancy rate for the Orange Loan portfolio is high at almost
27% and the WA lease term is also short at 3.5 years, therefore
the portfolio will require active asset management just to
maintain current occupancy levels.  Moody's value at
EUR 300 million is 26% below the UW market value as of May 2012.
Moody's loss expectation is in the 25%-50% range.

The property portfolios under the Peach (15.4% of the pool),
Coconut (15.4%), Pineapple (5.8%) and Apple Loans (5.6%) all
suffered further value declines in 2013.  Taking into account
some property disposals under these loans, the Peach Loan's value
declined by 24% since May 2012, the Coconut Loan's value declined
by 11% since September 2011, the Pineapple Loan's value declined
by 10% since October 2011 and the Apple Loans value declined by
34%.  In general, the loans in this transaction have short
weighted average lease terms, moderate to high vacancy rates and
some of the portfolios are over-rented.

Moody's value for the Coconut Loan portfolio, which is a mixture
of office and retail properties, is EUR 88 million while Moody's
value for the Peach Loan's retail and mixed use portfolio is
EUR 100 million.  Moody's loss expectation for these two loans is
in the 25%-50% range.

Portfolio Loss Exposure: Moody's expects a large amount of losses
on the remaining securitized portfolio as a whole and expects
that losses will eventually reach the Class B Notes.  Given
anticipated work-out strategy for the loans, Moody's expects that
the majority of the losses will be allocated towards the end of
the transaction term.



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L U X E M B O U R G
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ATENTO LUXCO: Fitch Affirms 'BB' IDR; Outlook Stable
----------------------------------------------------
Fitch Ratings has affirmed the long-term foreign-currency Issuer
Default Ratings (IDRs) of Atento LuxCo 1 S.A. (Atento) at 'BB'
with a Stable Outlook.  Fitch has also affirmed Atento's USD300
million senior secured notes at 'BB.'

Key Ratings Drivers

The ratings reflect Atento's 2nd largest market position in the
global customer relation management (CRM) outsourcing industry,
its well-established long-term relationship with clients,
geographical diversification, stable industry growth outlook, as
well as modest positive FCF generation over the medium term.

The ratings are tempered by its increased level of leverage due
to the leveraged buyout by Bain Capital in 2012, intense
competitive landscape, high customer concentration risk, as well
as increasing costs and turnover of labor force in Brazil.

Leverage to Gradually Improve

Fitch forecasts that Atento's financial net leverage will
gradually fall over the medium term mainly driven by higher
EBITDA generation and a reduced operating-lease-to-sales ratio.
Due to bond covenant restrictions, Atento's ability to pay
dividends or make any sizable acquisitions in the near-term is
limited. Therefore, with a modest positive free cash flow (FCF)
generation from 2015, its net debt to EBITDAR ratio will fall
towards 3.5x.

However, any material reduction in gross debt level, which was
EUR546 million at end-September 2013 from only EUR257 million at
end-2011 due to the leveraged buyout, is not likely given the
long maturities of its outstanding bonds.

EBITDA Growth amid Stable Industry Outlook

The company is likely to continue to improve its local-currency-
based EBITDA generation in most of its operational geographies,
except Spain, backed by the increasing demand for CRM outsourcing
service.  Although the competitive landscape is intense due to
new entrants and price-based competition for low-end services,
Atento's well-established market leading position as well as its
increasing scope of advanced product offerings should help
mitigate this risk and enable stable growth over the medium term.

Stable Operating Margins

Fitch forecasts that the company will be able to maintain its
EBITDAR margins in line with the historical level of 15% - 16% in
2014 and 2015 backed by its cost reduction initiatives.  Although
increasing labor cost, the highest component of its cost
structure representing about 70% of the revenue, has placed
pressure on margins, especially in Brazil, the company has coped
with this by relocating several working stations to cities that
provide cheaper labor sources and a lower turnover.  The company
also has taken other cost-cutting measures such as centralized
procurement of operating equipment, and IT system transformation
to improve productivity. Based on this, the company's EBITDAR
margin improved slightly to 15.2% in 9M13 from 14.5% in 2012.

High customer concentration

Atento is exposed to a significant customer concentration risk as
it generates close to 50% of total revenue from its largest
client, Telefonica Group.  However, Fitch believes that this risk
is alleviated by the service agreement with Telefonica which
guarantees an inflation-adjusted revenue threshold until 2021
enabling stable cash generation.  In addition, the company boasts
well-established long-term relationship with its clients as it
generates close to 90% of its total revenue from clients who have
contracted Atento for more than five years.

Sound Liquidity

Atento retained a sound liquidity profile as of Sept. 30, 2013 as
the consolidated group cash, EUR164 million, fully covered its
short-term debt, only EUR13 million.  In addition, the company
held an undrawn credit facility of EUR50 million.  Fitch does not
foresee any liquidity problem given long maturity schedules.

Rating Sensitivities

Negative rating action can be considered in case of an increase
in net debt to operating EBITDAR above 4x on a sustained basis,
caused by a decline in operating margins, slower revenue growth,
or continued negative FCF.

Positive rating action can be considered in case of an
significant improvement in cash generation resulting in a more
conservative financial profile over the long term. However,
positive rating action in the short to medium term is not likely
given the company's high leverage.


EURO FREIGHT: Moody's Lowers Rating on EUR273MM Notes to 'Ba1'
--------------------------------------------------------------
Moody's Investors Service has downgraded by one notch the notes
issued by Euro Freight Car Finance S.A. to Ba1(sf) from Baa3(sf).
The rating action reflects (1) the continuous deterioration of
the fleet utilization rate since the closing date in 2006; (2)
the uncertainty around the future level of fleet utilization; and
(3) the limited growth potential of the rail freight sector in
Europe, in the near to medium term.

Issuer: Euro Freight Car Finance S.A.

   -- EUR273.775 million Series 2006-1 Notes, downgraded to
      Ba1(sf); previously on March 23, 2011 downgraded to
      Baa3(sf) Euro Freight Car Finance S.A. provides financing
      to the Ahaus Alstatter Eisenbahn (AAE) group, secured on
      the railcars owned by two subsidiaries within the AAE
      group.

Receivables arising from the leases of these railcars provide the
primary source of funds to allow the issuer to repay the notes.

Ratings Rationale

The downgrade reflects the ongoing deterioration of one of the
transaction's key performance indicators, the railcar fleet
utilization rate, to 89% in September 2013 from 99% in December
2007.  The average lease term is much shorter than the notes'
amortization horizon: the typical lease contract maturity is
around two years, while the notes will remain outstanding for 8-
10 years according to Moody's projections.  As such, the
transaction relies on the possibility of renewing lease contracts
or finding new lessees for the railcars. In Moody's view, both
are negatively affected by the decreasing trend in the
utilization rate.

The satisfactory evolution of the debt service coverage ratio
(DSCR) mitigates the magnitude of the downgrade.  However, this
ratio might deteriorate in the future as scheduled principal
payments will increase.  In its analysis, Moody's projected the
transaction's future cash flows in various scenarios and
considered stressed levels of its key drivers such as the fleet
utilization rate, lease rates, maintenance and revision costs.

Moody's considers that the growth potential of the rail freight
sector in Europe in the near to medium term appears limited,
given the low expected economic growth of the region and
structural challenges specific to the sector.  Thus, the
potential for improvement of the fleet utilization rate appears
limited, which weakens the asset's future cash flow generating
ability.

The rating of the notes is also linked to the ability of AAE
Ahaus Alstatter Eisenbahn AG (AAE AG), as servicer, to lease and
re-lease the railcars to existing and new customers during the
life of the transaction.  As a result the transaction is exposed
to the business risk of the AAE group which the servicer, AAE AG,
is part of.  Structural features provide protection to the notes
against this in the form of a back-up servicer facilitator
arrangement with HSH Nordbank AG (deposits Baa3/Prime-3 stable,
BFSR E/BCA caa2 stable), which was appointed at closing.  Other
structural features include a liquidity fund of EUR12 million to
cover payments due on the notes and a revision and wheelset
facility of EUR18 million available until 2018 to allow for
servicing and maintenance costs of the railcars to be covered.

The issuer is registered in Luxembourg and is a subsidiary of AAE
Ahaus Alstatter Eiesenbahn Cargo AG (AAE Cargo).  AAE Cargo is
registered in Switzerland and is a subsidiary of AAE Ahaus
Alstaetter Eisenbahn Holding AG, also based in Switzerland.

As of Dec. 31, 2013, the notes balance is EUR183.6 million.  The
principal amount of the notes is amortizing under a scheduled
amortization pattern over a 10 year period.  The notes have
amortized as expected since closing in 2006.

Factors That Would Lead to an Upgrade or Downgrade of the Rating

What Could Change The Rating DOWN

Downward pressure would develop on the notes' rating following
(1) deterioration of the key transaction performance metrics:
fleet utilization rate, DSCR, an unexpected trend in operating
expenses; (2) negative developments in the railcar leasing market
in Europe; or (3) deterioration of the credit quality of the
servicer's group.

What Could Change The Rating UP

Upward pressure could develop on the notes' rating following
(1) improvement of the credit quality of the servicer's group;
(2) an improved outlook for the railcar leasing market in Europe;
or (3) significant and durable improvement of the fleet
utilization rate.


S&B MINERALS: Moody's Assigns 'B3' CFR; Outlook Remains Stable
--------------------------------------------------------------
Moody's Investors Service has assigned a definitive B3 corporate
family rating (CFR) to S&B Minerals Finance S.C.A. (S&B or the
company).  Concurrently, Moody's has assigned a B2-PD probability
of default rating (PDR) to the company, and a definitive B3
rating to the EUR275 million senior secured notes maturing in
2020 issued by the company and S&B Industrial Minerals North
America, Inc. as co-issuers.  The outlook on the ratings remains
stable.

Ratings Rationale

The final terms of the Notes are in line with the drafts
previously reviewed to assign the provisional ratings.

The PDR at B2-PD, one level above the CFR, reflects Moody's
assumption of a 35% family recovery rate given the lack of any
financial maintenance covenants in the structure.  The
EUR40 million super senior revolving credit facility and the
EUR275 million senior secured notes include incurrence covenant
tests.  Additional subordinated indebtedness can be raised if the
Fixed Charge Cover Ratio is at least 2.25x while the net leverage
ratio must be at 3.0x or below in order to be able to raise
additional senior secured debt.

The stable outlook reflects Moody's expectation that S&B should
be able to (1) maintain its current profitability levels; (2)
maintain its adequate liquidity position; and (3) keep adjusted
leverage well below 5.0x.  Due to the rating being relatively
weakly positioned in its category, we do not foresee any upwards
pressure in the short-term.  Conversely, negative rating pressure
could develop if (1) the company's adjusted leverage ratio
increases to 5.0x; (2) the company experiences pressure on its
EBIT margin; (3) its liquidity position deteriorates due to weak
performance or significant spend on acquisitions; or (4) Moody's
observe a further deterioration in the political and economic
environment in Greece where a significant portion of the
company's mining assets are located.

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.
Please see the Credit Policy page on www.moodys.com for a copy of
these methodologies.

S&B is a provider of mineral-based industrial solutions.  Its
main activities include the mining, processing, distribution and
supply of industrial minerals.  In 2012, S&B Industrial Minerals
operated 30 mines, 49 processing facilities and 27 warehouses and
distribution centers in 21 countries.  The company is owned by
the Kyriacopoulos family (61%) and the private equity investor
Rhone Capital (39%).



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


CADOGAN SQUARE: S&P Affirms 'B+' Rating on Class E Notes
--------------------------------------------------------
Standard & Poor's Ratings Services affirmed all of its credit
ratings in Cadogan Square CLO B.V.

The rating actions follow S&P's assessment of the transaction's
performance by applying its relevant criteria and conducting its
credit and cash flow analysis.  In S&P's analysis, it took into
account recent developments and used November 2013 trustee report
data.

Following S&P's analysis, it has observed that the proportion of
assets that it considers to be rated in the 'CCC' category (i.e.,
rated 'CCC+', 'CCC', or 'CCC-') and defaulted assets have
decreased in notional terms but have increased in percentage
terms, as the transaction is in its amortization phase since
S&P's previous review on Dec. 19, 2012.  In notional terms,
assets that S&P considers to be rated in the 'CCC' category have
decreased to EUR8.18 million from EUR8.8 million; defaults have
decreased to EUR10.7 million from EUR11.4 million.  In percentage
terms, assets that S&P considers to be rated in the 'CCC'
category have increased to 3.17% of the performing pool from
2.53%; defaults now comprise 3.99% of the pool, up from 3.16%.

S&P conducted its cash flow analysis to determine the break-even
default rates (BDRs) for each rated class at each rating level.
S&P incorporated various cash flow stress scenarios, using
various default patterns in conjunction with different interest
stress scenarios.  The transaction has material exposure to
assets in Spain, Ireland, and Italy.  S&P has therefore applied
additional stresses on assets in those countries in its 'AAA' and
'AA' scenarios.

At closing, Cadogan Square CLO entered into derivative agreements
to mitigate currency risk.  The documentation for the derivative
contracts are not fully in line with S&P's current counterparty
criteria.  Therefore, in S&P's cash flow analysis for scenarios
above 'AA-', it has applied additional foreign exchange stresses.

Since S&P's previous review, the pool's weighted-average life has
increased to 4.79 years from 4.28 years and the transaction
benefits from a higher weighted-average spread of 4.43%, up from
3.98%.  With the amortization of the class A-1 and A-2 notes, the
available credit enhancement for all classes of notes has
increased.  In their par coverage tests, all of the tranches
remain within their documented triggers, with greater cushions
than at S&P's previous review.

S&P has affirmed its rating on the class A-1, A-2, B, and C notes
as their available credit enhancement is commensurate with its
currently assigned ratings.

"Our ratings on the class D and E notes are constrained by the
application of the largest obligor test, a supplemental test that
we introduced in our 2009 cash flow collateralized debt
obligation (CDO) criteria.  This test addresses event and model
risk that might be present in the transaction.  Although the BDRs
generated by our cash flow model indicated higher ratings, the
largest obligor test effectively caps our ratings on the class D
and E notes at the currently assigned rating levels.  We have
therefore affirmed our ratings on the class D and E notes," S&P
noted.

Cadogan Square CLO is a cash flow collateralized loan obligation
(CLO) transaction that securitizes loans granted to primarily
speculative-grade corporate firms.  The transaction closed in
December 2005.

RATINGS LIST

Ratings Affirmed

Cadogan Square CLO B.V.
EUR450 Million Secured Floating-Rate Notes

Class            Rating

A1               AAA (sf)
A2               AAA (sf)
B                AA (sf)
C                A (sf)
D                BB+ (sf)
E                B+ (sf)


VTR FINANCE: Moody's Assigns B1 CFR & Rates New US$1.4BB Bonds B1
-----------------------------------------------------------------
Moody's Investors Service assigned a B1 Corporate Family Rating
to VTR Finance B.V. (VTR HoldCo) and a B1 to its proposed $1.4
billion bond issuance.  Moody's expects the majority of proceeds
to go toward repayment of debt at UPC Holding B.V. (UPC). VTR
GlobalCom SpA, a subsidiary of VTR HoldCo, is currently part of
the UPC credit pool.  In conjunction with this transaction,
Liberty Global plc (LGP) will create a new standalone credit pool
by taking VTR GlobalCom SpA out of the UPC credit pool and
combining it with VTR Wireless SpA (together with VTR
GlobalComSpA, VTR).  UPC is an indirect subsidiary of LGP with
operations in 10 countries throughout Western Europe, Central and
Eastern Europe, and Chile, and VTR is comprised of UPC's Chilean
cable assets and Wireless.

Ratings are subject to review of final documentation.

VTR Finance B.V.

   -- Corporate Family Rating, Assigned B1;

   -- Senior Secured Bonds (share pledge only), Assigned B1
      Outlook, Stable

RATINGS RATIONALE

The B1 Corporate Family Rating (CFR) incorporates VTR's high
leverage, estimated at approximately 4.7 times debt-to-EBITDA pro
forma for the proposed debt issuance (based on the last twelve
months through September 30, 2013 and the January 2014 CLP / USD
exchange rate) and Moody's expectations for free cash flow-to-
debt below 5% over the next several years.  Moody's leverage
calculation includes the negative impact of VTR's wireless
operations, and Moody's expects VTR's transition to a Mobile
Virtual Network Operator (MVNO) strategy, currently underway, to
materially improve margins.  Moody's estimates leverage excluding
the wireless losses would be around 4 times and believe the
company could achieve leverage around 4 times both including and
excluding the wireless losses in 2014.  Execution on the new
mobile strategy nevertheless poses risk, and the shutdown and
continuing losses will consume cash.  Bondholders are also
subject to structural risks.  The bonds provide for security in
shares of holding companies only, with no guarantees from the
operating companies which generate the cash flow necessary to
service the debt.  Furthermore, LGP owns only 80% of VTR, with a
non-controlling interest owning the remaining 20%, creating the
potential for cash leakage to the minority holder.  Moody's
expects the structure will incorporate intercompany loans to
facilitate the flow of cash from VTR to VTR HoldCo in a tax
efficient manner.  The ratings assume that these intercompany
loans remain in the proposed VTR credit pool, and that any flow
of cash from VTR or HoldCo to the owners occurs only after timely
debt service on the proposed bonds.  Deviation from these
expectations would likely have negative rating implications.

VTR's leading position in the Chilean market, which benefits from
favorable economic conditions and some remaining customer growth
as more consumers subscribe to pay television and high speed
data, affords the company with good growth prospects over the
next several years.  EBITDA growth from both margin improvement
and subscriber gains should lead to lower leverage, but given the
absence of easily repayable debt in the capital structure and
expectations for minimal free cash flow, we do not expect debt
reduction.  VTR faces intense competition from larger, better
capitalized telecommunications operators but currently has
capacity to offer faster broadband speeds and more high-
definition channels and advanced video services across most of
its footprint. This network positions it well for growth over the
next several years, but beyond that time frame both market
saturation and the potential for continued competition could
stall growth.  Ownership by LGP constrains the rating in that
this owner has a fairly aggressive financial policy, but supports
the rating given LGP's scale, which affords the company with
better access to both technological developments and the capital
markets.  LGP has committed funds to fund losses related to the
shutdown of the mobile network, though no contractual
requirements for such support are in place at this time.

The stable outlook assumes EBITDA growth will facilitate positive
free cash flow and a decline in leverage to the mid 4 times debt-
to-EBITDA range or better in 2014.  The outlook also assumes
maintenance of adequate liquidity.

The LGP ownership, structural risks, and expectations for
continued cash drain and margin pressure from the wireless
business constrain the rating.  An upgrade would require evidence
of success in the transition of the mobile business, a longer
track record of positive operational performance for the
standalone VTR asset pool, and a firm commitment to a stronger
credit profile.

Lack of progress on reducing leverage through EBITDA growth or
expectations for negative free cash flow would likely lead to a
negative rating action.  Evidence of cash leakage to the minority
partner or intercompany loans insufficient to facilitate cash
distributions to VTR HoldCo for debt service could also warrant a
downgrade.  A change in the programming cost structure such that
Moody's expected increases in payments to broadcast partners
substantial enough to result in material margin erosion could
negatively impact the rating absent positive factors in either
operating fundamentals or financial policy.

VTR provides video, broadband internet and fixed and mobile
telephony services throughout Chile.  Its network passes
approximately 2.9 million homes as of Sept. 30, 2013.  It is
currently a subsidiary of UPC. UPC is an indirect subsidiary of
LGP with operations in 10 countries throughout Western Europe
(The Netherlands, Switzerland, Ireland and Austria), Central and
Eastern Europe (Hungary, Romania, Czech Republic, Poland and
Slovakia) and Chile.  LGP owns 80% of VTR, and The Saieh Group
owns the remaining 20%.



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


POLIMEX-MOSTOSTAL: Won't Complete Construction of A1/A4 Highways
----------------------------------------------------------------
Warsaw Business Journal reports that the General Directorate of
National Roads and Motorways (GDDKiA) announced Tuesday Polimex-
Mostostal will not complete the construction of two sections of
the A1 and A4 highways.

The reason for dissolving the contract were major delays the
company has had with construction, Warsaw Business Journal says.

Polimex-Mostostal won a tender back in 2010 to build 45 kms. of
the A4 highway between Rzeszow and Jaroslaw in southeastern
Poland and 40 kms. of the A1 highway between Strykow and Tuszyn
in central Poland, Warsaw Business Journal recounts.

The construction of these roads will likely be delayed even
further, until 2016, Warsaw Business Journal notes.

In December, the Directorate also dissolved a contract with
Polimex-Mostostal to build a section of the S69 expressway
between Bielsko-Biala and Zywiec in southern Poland, also due to
a major delay, Warsaw Business Journal relays.

Last year, the troubled construction firm managed to reach an
agreement with its creditors, which helped save the company from
bankruptcy, Warsaw Business Journal recounts.  As of June 2013,
Polimex-Mostostal had PLN800 million in debt, Warsaw Business
Journal discloses.  The group is undergoing restructuring,
selling non-essential assets, and attempting to lower its debt,
Warsaw Business Journal says.

As Polimex-Mostostal is a key player in several major energy
projects, including a PLN6 billion power block in Kozienice,
government agencies have also come to the group's rescue, Warsaw
Business Journal relates.  The Industry Development Agency (ARP)
has bought PLN150 million worth of the firm's newly issued
shares, Warsaw Business Journal notes.

Polimex-Mostostal is a Polish engineering and construction
company that has been on the market since 1945.  The Company is
distinguished by a wide range of services provided on general
contractorship basis for the chemical as well as refinery and
petrochemical industries, power engineering, environmental
protection, industrial and general construction.  The Company
also operates in the field of road and railway construction as
well as municipal infrastructure.  Polimex-Mostostal is a large
manufacturer and exporter of steel products, including platform
gratings, in Poland.



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


OLTCHIM SA: Jan. 31 Bid Deadline Set for Oltchim SPV Stake
----------------------------------------------------------
The consortium of judicial administrators of OLTCHIM S.A., the
largest company in the Romanian petro-chemical industry, namely
Rominsolv SPRL and BDO BUSINESS RESTRUCTURING SPRL, will organize
on February 3, 2014, at 11:00 a.m. (Romanian time), at Double
Tree by Hilton located in Bucharest, 3A Nerva Traian Blvd.,
district no. 3, the procedure of selection of a binding offer for
the selling of OLTCHIM's shareholding at Oltchim SPV.

Interested bidders will have to submit at BDO BUSINESS
RESTRUCTURING SPRL's premises located in Bucharest 24
Invingatorilor Street, Victory Business Center or ROMINSOLV
SPRL's premises located in Bucharest, 223 Splaiul Unirii, 3rd
Floor, by January 31, 2014, 11:00 a.m. (Romanian time) the
latest, all the documents required by the selection book, which
cost 20.000 EUR (VAT not included) and can be acquired from BDO
BUSINESS RESTRUCTURING SPRL or ROMINSOLV SPRL.

For any information or inquiries, contact +4021-319-94-76 and
+4021-321-13-42.


PIC ORADEA: Western Logistics Acquires Business
-----------------------------------------------
Shaun Turton at Romania-Insider.com reports that The PIC Oradea
Hypermarket' liquidator PricewaterhouseCoopers said the shopping
center has been sold to Western Logistics SRL, part of Maltese
company Alf, Mizzi and Sons, and will be turned into a logistics
center.

According to Romania-Insider.com, the exact value of the deal
wasn't revealed but PwC's business recovery team senior manager
Cristian Ravasila said it was a good outcome for an asset worth
several million euros in a difficult market.

PwC stated that the new owner has already started setting it in
order to rent all or part of it for small manufacturing, storage
and distribution, and logistics companies as well as for office
space, Romania-Insider.com relates.

PIC SA entered bankruptcy in 2012 and still owns four
hypermarkets in Pitesti, Braila, Calarasi and Craiova, which are
in various stages of the liquidation procedure, Romania-
Insider.com recounts.



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


RUSSNEFT OJSC: S&P Affirms 'B' CCR & Removes Rating from Watch
--------------------------------------------------------------
Standard & Poor's Ratings Services said it had affirmed its 'B'
long-term corporate credit rating on Russian oil producer Oil and
Gas Company Russneft OJSC and removed it from CreditWatch, where
S&P placed it with negative implications on June 25, 2013.  The
outlook is stable.

At the same time, S&P raised to 'ruA-' from 'ruBBB+' its national
scale rating on Russneft, and removed it from CreditWatch, where
S&P placed it with negative implications on June 25, 2013.

The rating actions and CreditWatch removals follow Russneft's
withdrawing its guarantee on the $2 billion debt of its Urals-
based subsidiary, which the company sold in 2013.  S&P now
believes Russneft's leverage and liquidity are comfortable for
the 'B' rating.

"We assess Russneft's business risk profile as 'weak,' reflecting
its weak competitive position.  Russneft is smaller and less-
diversified than most rated local peers, particularly after the
sale of its Urals-based assets. Like other Russian oil companies,
Russneft faces a heavy tax burden and is exposed to potential
changes in the industry's tax and regulatory framework.  On the
positive side, Russneft's operations benefit from a natural
hedge, via taxes and foreign exchange rates, like other Russian
oil companies.  This makes profits more resilient to potential
changes in the oil price," S&P said.

S&P views Russneft's financial risk profile as "aggressive",
reflecting its forecast of funds from operations (FFO) to debt of
about 15%-20%, debt to EBITDA of about 3.5x-4x, and marginally
positive free operating cash flow in 2014-2015.  S&P estimates
that, now that the guarantee has been removed, Russneft's total
debt at year-end 2013 will have been below US$3 billion.

S&P understands from management that the acquisition of a
controlling stake in Russneft for US$1.2 billion in 2013 was
financed with medium-term debt that is non-recourse to Russneft.
S&P believes that the new controlling shareholder, Mikhail
Gutseriev, has other cash-generating assets to service this debt.
In addition, S&P understands Mr. Gutseriev is considering
transferring his Azerbaijan-based oil assets to Russneft.
However, it is still unclear whether the financing of this
transaction would affect Russneft's debt and equity, and whether
there is any debt attached to the assets.

Russneft's financial policy is aggressive, in S&P's view.
Although the guarantee has been lifted and debt related to the
share repurchase has been transferred to the shareholder, S&P
continues to see uncertainties regarding Russneft's policy for
financial risk management, leverage, dividend requirements, and
related party transactions.  At this stage, S&P cannot quantify
the magnitude of any such steps and therefore reflect it in the
negative financial policy adjustment.

The stable outlook reflects S&P's expectation that Russneft will
post FFO to debt of about 15%-20% and relatively weak free
operating cash flow, and avoid any major liquidity issues.



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


JAMES BALFOUR: Cash Flow Constraints Prompt Administration
----------------------------------------------------------
Insider Media reports that James Balfour & Sons has fallen into
administration making all 16 of its staff redundant.

Administrators were called in for James Balfour & Sons, Insider
Media relays.

Administrator James Neill -- james@hnhpartners.co.uk -- from
Belfast-based Horwood Niell Holmes, cited the "general downturn"
in the construction sector and reduction in government
infrastructure expenditure for the appointment, after James
Balfour's financial performance was impacted, Insider Media
relates.

Mr. Neill also said that the business had "significant cash flow
constraints" and confirmed to Insider that 11 staff were made
redundant prior to his involvement, with a further five losing
jobs upon his appointment, Insider Media relays.

"The company had ceased to trade prior to the appointment of the
administrator.  We are currently undertaking an immediate
assessment of the business and its assets, with a view to
maximising returns to stakeholders," Insider Media quotes
Mr. Neill as saying.  "The immediate priority is to communicate
with the key stakeholders of the business including employees and
suppliers."

James Balfour & Sons was formed in 1964 and supplied raw
materials to the Northern Irish road construction sector.



MERGERMARKET GROUP: Moody's Assigns B3 Corporate Family Rating
--------------------------------------------------------------
Moody's Investors Service assigned a B3 corporate family rating
(CFR) to Mergermarket Group, the holding and parent company of
Mergermarket USA Inc.

Moody's also assigned a (P)B2 rating to the GBP150 million first
lien term loan due 2021 and USD40 million Revolving Credit
Facility maturing in 2019, and a (P)Caa2 rating to the
GBP70 million second lien tem loan due 2022, to be issued by
Mergermarket USA Inc.  The outlook on all ratings is stable.
This is the first time Moody's has assigned a rating to
Mergermarket.  Moody's issues provisional ratings in advance of
the final sale of securities and these ratings reflect Moody's
preliminary credit opinion regarding the transaction only.  Upon
a conclusive review of the final documentation, Moody's will
endeavor to assign a definitive rating to the term loans.  A
definitive rating may differ from a provisional rating.

Ratings Rationale

The B3 CFR reflects (1) the company's high financial leverage
with limited deleveraging expected in the near term; (2) the
company's relatively small scale; (3) revenue concentrated on two
products, and within the financial services industry.

The B3 CFR also positively reflects the company's (1) leading
market position in niche segments, with an international
presence; (2) longstanding commercial relationships with top tier
players in each business segment served; (3) good track record of
growth in its largely subscription-based revenues (more than 90%
of revenues); and (4) high annual renewal rate exceeding 95%.

After Moody's standard adjustments, total leverage at closing is
expected to stand at around 7.0x.  However, Moody's expects that
the company will be able to reduce its leverage over the next two
years driven by modest increase in EBITDA and expected prepayment
out of excess cash flow.  Moody's expects the company's EBITDA to
show limited growth in the near term due to higher costs and
EBITDA margin to stand at around 30% on average.  Mergermarket
presents a high operating leverage with product salaries
representing c.80% of total costs in 2012.

Cash generated by operations is solid thanks to negative working
capital and low level of capex.  However, due to the high level
of interest, Moody's expects that the company's free cash flow
over the next two years will be relatively low, with FCF to debt
below 5% in 2014, gradually improving thanks to improved EBITDA.

The company has made some attempts to diversify away from its 2
core products (Mergermarket and Debtwire), by developing products
away from the financial services sector (biopharma, legal
analysis with the acquisition of Xtract Research in 2010 and
infrastructure with the acquisition of the Inframation Group in
2012) but with limited success in terms of weight in total
revenues with each of them representing between 3% and 6% of
revenues.  The ratings assume that there will be no material
acquisitions prior to the company having delevered significantly.

Mergermarket presents credit metrics based on "cash EBITDA".
This results in higher EBITDA and lower leverage than financials
based on UK GAAP and factoring in Moody's standard adjustments.
Moody's considers subscription value to be akin to a backlog
housed in unearned revenue, and utilizes the GAAP reported
financials for consistency with other rated issuers and in
recognition that expenses are growing in conjunction with revenue
and subscription levels.

Mergermarket's liquidity profile is adequate for its near-term
needs.  With zero opening cash, the company is immediately
reliant on its USD40 million RCF for liquidity.  However, this
should be repaid as free cash flow grows, and given that the
first lien debt amortizes by 1% p.a., with a cash sweep operating
from 2015 (based on 2014 Excess Cash Flow).  The RCF has a
springing leverage covenant when it is drawn by more than USD 10
million.

The stable outlook reflects Moody's expectation that Mergermarket
will be able to maintain its strong leadership and customer base
globally, while benefiting from the expected growth in the M&A
and continued growth in the capital market activities in 2014 and
2015.  It also incorporates Moody's assumption that the company
will deleverage below 7x in 2014, and also will not embark on any
transforming acquisitions or make debt-funded shareholder
distributions.

The first lien term loan, RCF and second lien term loan all
benefit from the same security package, including guarantees from
material operating subsidiaries and security over the assets of
substantially all the guarantors.  All shareholder funding
entering Mergermarket Group -- which is the top company of the
restricted group -- will be in the form of common equity.  The
(P) B2 rating on the GBP 170 million first lien term loan and the
pari-passu RCF reflects the fact that this debt ranks ahead of
the GBP 70 million second lien term loan, which is consequently
rated (P)Caa2.

What Could Change The Rating UP

Positive pressure on the rating could materialize if (1) FCF to
debt approaches 10%; (2) Moody's-adjusted EBITDA margin is
sustained at around 30%; (3) Moody's-adjusted debt/EBITDA ratio
falls below 6.0x.

What Could Change The Rating DOWN

Negative pressure could be exerted on the rating if the company
fails to maintain the current momentum in its operational
performance, leading to a deterioration in renewal rate such that
(1) a weakening of its operational performance results in lower
cash generation; or (2) there is an aggressive change in its
financial policy; or (3) Moody's-adjusted debt/EBITDA ratio fails
to fall below 7.0x in 2014.

The principal methodology used in these ratings was the Global
Publishing Industry 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.

Mergermarket, headquartered in the United Kingdom, is a global
financial market information company.  Invoiced sales for the
fiscal year ended December 2012 was approximately GBP104 million.


SAMNUGGUR JUTE: Hooley Challenges Administrator's Actions
---------------------------------------------------------
Hooley Limited presented, on Oct. 24, 2013, three petitions to
the Court of Session in Scotland seeking a Declarator from the
Court regarding, inter alia, the validity of the actions of the
Administrator of The Samnuggur Jute Factory Company Limited, The
Victoria Jute Company Limited and Titaghur Plc.

The Court of Session gave any person having an interest to lodge
answers within 42 days after intimation, service and
advertisement.

Samnuggur Jute, Victoria Jute and Titaghur Plc are all
incorporated under the Companies Acts and have registered offices
at 24 Great King Street, in Edinburgh EH3 6QN.

Petitioner Hooley Limited is a Guernsey Registered Company with
offices at Richmond House, St. Julian's Avenue, St. Peter Port,
in Guernsey GY1 1GZ.  Its agent is:

     Craig Kennedy
     MACLAY MURRAY & SPENS LLP
     Solicitors
     1 George Square
     Glasgow G2 1AL


YALES LEISURE: Unsecured Creditors May Not Recover Claims
---------------------------------------------------------
Richard Frost at Insider Media reports that a new buyer has
emerged for two Wrexham nightspots owned by Yales Leisure after
an earlier deal fell through.  Unsecured creditors of Yales
Leisure however are not expected to receive any payment following
the company's collapse, according to the report.

Yales Leisure entered administration on November 13, 2013, and
Christopher Pole and Mark Orton of KPMG were appointed
administrators, Insider Media recounts.

Incorporated in 1998, the business owned and operated Yales Cafe
Bar and Central Station on 15-17 Hill Street, and South Central
Bar at 32a Townhill, Insider Media discloses.

"The business suffered badly in the wake of the recession and the
overall decline in the licensed trade.  Following losses in 2011
and 2012, the position had continued to worsen with further
losses expected in 2013," Insider Media quotes the administrators
as saying.

On appointment, the administrators decided the offer for both
properties promised the best return to creditors and entered into
a 28-day exclusivity agreement which expired on December 11,
2013, Insider Media relates.  However, the sale was not concluded
within this timeframe, and a further offer from another bidder
for both properties was submitted and accepted, Insider Media
relays.  This latter offer is now being progressed, according to
the report.

Both Yales Cafe Bar and Central Station and South Central Bar are
still trading, Insider Media notes.

According to Insider Media, the statement also shows Barclays
Bank is owed approximately GBP705,000 from Yales Leisure.  About
GBP247,000 is expected to be realised from Yales Leisure'
freehold property, meaning the bank is facing a shortfall of
GBP457,858, Insider Media says.

Meanwhile, unsecured creditors, including trade and expense
creditors, are claiming GBP174,000, Insider Media discloses.
They are not expected to receive any payment, the news source
relays.

Yales Leisure Limited is a popular town centre cafe bar and live
music venue.



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


* EUROPE: Draft Rejects Automatic Separation of Bank Activities
---------------------------------------------------------------
Geoffrey T. Smith at The Wall Street Journal reports that a plan
that would have changed the business models of Europe's dominant
banks appears to have run into the sand.

In Europe's first response to the U.S. Volcker rule, which puts
strict limits on banks' trading activities, the European
Commission rejected an automatic mandatory separation of banks'
market-related activities from deposit-taking, according to draft
legislation seen by the Journal.  According to the Journal, that
will disappoint those who had hoped the European Union would do
more to ensure that banks' state-guaranteed deposits aren't used
to support riskier market-related business.

Consumer lobbyists and a large part of the European Parliament,
especially on the left, had wanted a bolder approach that would
have broken up the "universal banks" that dominate Europe, such
as Deutsche Bank AG, Barclays PLC and BNP Paribas, the Journal
discloses.  But they now appear to have an uphill task: the
postcrisis tide of enthusiasm for new regulation has started to
ebb as politicians have become increasingly desperate to revive
growth, the Journal notes.

According to the Journal, the draft proposal, from internal
markets Commissioner Michel Barnier, ignores the favored option
outlined in an EU-commissioned October 2012 report by a group of
experts under Finnish central bank governor Erkki Liikanen.  The
report recommended a wide-ranging separation, but left the
commission room to take a softer line, the Journal says.

The Barnier draft hasn't been endorsed yet by the rest of his
colleagues, and needs to be agreed by 28 member states and the
European Parliament before it becomes law, the Journal notes.
Both can add to or delete from the draft as they wish, the
Journal states.

They are unlikely to tackle the proposal seriously until after a
new Parliament is elected in May and a new commission appointed,
likely toward the end of the year, the Journal says.

The commission's proposals differ in a number of key areas from
Volcker, the Journal notes.  According to the Journal, small
European banks, for example, are largely exempted on the grounds
that they don't pose a threat to the financial system, whereas
their counterparts in the U.S. are already announcing forced
sales of assets they are no longer allowed to hold.


* BOOK REVIEW: The Phoenix Effect
---------------------------------
Authors: Carter Pate and Harlann Platt
Publisher: John Wiley & Sons, Inc.
Softcover: 244 Pages
List Price: $27.95
Review by Gail Owens Hoelscher

Buy a copy for yourself and one for a colleague on-line at
http://amazon.com/exec/obidos/ASIN/0471062626/internetbankrupt
Think of all the managers of faltering companies who dream of
watching those companies rise from the ashes all around them!
With a record number of companies failing in 2001, and another
record-setting year expected for 2002, there are a lot of ashes
from which to rise these days.

Carter Pate and Harlan Platt highly value strong leadership able
to sharpen a company's focus and show the way to the future.
They believe that all too often, appropriate actions required to
improve organizations are overlooked because upper management
either isn't aware of the seriousness of the issues they face or
they don't know where to turn for accurate information to best
address their concerns. In the Phoenix Effect, the authors
present their ideas to "confront, comprehend, and conquer a
company's ills, big and small."

These ideas are grouped into nine steps: (i) Find out whether
the company needs a tune-up, a turnaround, or crisis management.
Locate the source of "the pain." (ii) Analyze the true scope of
the company's operations. Decide whether to stay in the same
businesses, withdraw from existing businesses, or enter new
ones. (iii) Hold the company to its mission statement. If it
strives to be "the most environmentally friendly." Figure out
how. (iv) Manage scale. Should the company grow, stay the same
size, or shrink? (v) Determine debt obligations and work toward
debt relief. (vi) Get the most from the company's assets.
Eliminate superfluous assets and evaluate underused assets.
(vii) Get the most from the company's employees. Increase output
and lower workforce costs. (viii) Get the most from the
company's products. Turn out products that are developed and
marketed to fill actual, current customer needs. (ix) Produce
the product. Search for alternate ways to create the product:
owning or leasing facilities, outsourcing, etc.

The authors believe that "how you're doing is where you're
going." They assert that the "one fundamental source of life in
companies, as in people,.is the capacity for self-renewal, the
ability to excite your team for game after game. to go for broke
season after season." This ability can come from "(g)enetics,
charisma, sheer luck, stock options - all crucial, yes, but the
best renewal insurance is a leader who always knows exactly how
his or her company is doing."

There are a lot of books written on this topic. Pate and Platt
successfully bridge the gap between overgeneralization and too
detail. They are equally adept at advising on how to go about
determining a business's scope and arguing for Monday rather
than Friday for implementing layoffs. They don't dwell on sappy
motivational techniques. They don't condescend to the reader or
depend too much on folksy vernacular and clich,. Their message
is clear: your company's phoenix, too, can rise from its ashes.
167

* Carter Pate is a well known turnaround expert at
PricewaterhouseCoopers with more than 20 years experience
providing strategic consulting and implementation strategies.

* Harlan Platt is a professor of finance at Northeastern
University and author of the book Principles of Corporate
Renewal.


                            *********

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

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

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

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


                            *********


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

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

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
202-241-8200.


                 * * * End of Transmission * * *