TCREUR_Public/140212.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

          Wednesday, February 12, 2014, Vol. 15, No. 30



HYPO ALPE-ADRIA: Austria Scraps "Bad Bank" Plan


COMMERZBANK AG: Fitch Hikes Lower Tier 2 Debt Rating From 'BB+'


DRYSHIPS INC: Ocean Rig Enters Into Amendment of Term Loan


BROOKLANDS 2004-1: Fitch Lowers Rating on Class D Notes to Dsf
ELVERYS SPORTS: Sports Direct Welcomes News of Examiner
MOUNT CARMEL HOSPITAL: Centric Health Makes Fresh Bid


* ITALY: Banks May Face Capital Shortfall of Up to EUR15 Bil.


PORTUGAL TELECOM: S&P Retains 'BB' CCR on CreditWatch Developing


ALLIANCE OIL: S&P Lowers Corp. Credit Rating to 'B-'
PERESVET BANK: S&P Assigns B+ Counterparty Rating; Outlook Stable


PESCANOVA SA: Enters Into Crucial Talks with Creditor Banks


STENA AB: S&P Assigns 'BB+' Rating to Proposed Sr. Secured Loan


FERREXPO PLC: S&P Cuts Corp. Credit Rating to 'B-'; Outlook Neg.

U N I T E D   K I N G D O M

CONSOLIDATED MINERALS: S&P Raises CCR to 'B+'; Outlook Stable
DECO 6: Fitch Affirms 'Csf' Rating on 3 Note Classes
GRAHAM WOOD: Seeks Court Protection From Creditors
LINENHALL PROPERTY: Collapses Into Administration
MAYO SEVEN: Brady Sullivan Steps in Acquire Center At Keene

PUNCH TAVERNS: Publicans Could Face Cash Crisis if Pub Calls Time
ROSEMARY CONLEY FOOD: Goes Into Administration, Cuts 6 Jobs

* UK: Administration Rescued Fewer Stores in 2013



HYPO ALPE-ADRIA: Austria Scraps "Bad Bank" Plan
Michael Shields at Reuters reports that officials said Austria
scrapped its plan to have healthy commercial lenders back a "bad
bank" for toxic assets at nationalized Hypo Alpe-Adria
International AG and will look now at creating its own wind-down
vehicle, which would increase state debt.

According to Reuters, Finance Minister Michael Spindelegger said
after a high-level meeting at the chancellery on Monday
resistance from other banks and problems with setting up a bad
bank in a way that would keep its debt off state books under
European rules scuppered the plan.

He told reporters that letting Hypo go bust remained an option if
all else failed, Reuters relates.  The central bank and FMA
markets watchdog vehemently rejected that move, saying it posed
too great a risk of sweeping Austria itself up in the contagion,
Reuters relays.

The least bad option now is considered the creation of a state
vehicle absorbing up to EUR19 billion (US$26 billion) in assets
from Hypo, Reuters states.  That would relieve the bank's chronic
need for capital, which is a drain on state finances, Reuters

Just how much a state bad bank would cost was not immediately
clear, Reuters notes.

Mr. Spindelegger refused to exclude an insolvency, the threat of
which boosts Austria's leverage in negotiations with former owner
BayernLB over who should pay to clean up the mess at the
Klagenfurt-based lender, Reuters recounts.

                     About Hypo Alpe-Adria

Hypo Alpe-Adria International AG is a subsidiary of BayernLB.  It
is active in banking and leasing.  In banking, HGAA serves both
corporate and retail customers and offers services ranging from
traditional lending through savings and deposits to complex
investment products and asset management services.

Hypo Alpe has received EUR1.75 billion in aid in emergency
capital from the Austrian government.  European Union Competition
Commissioner Joaquin Almunia said in March 2013 that Hypo faced
possible closure for failing to adequately restructure.
The European Commission approved Hypo's recapitalization in
December 2013, but made it conditional on the management
presenting a thorough plan to overhaul the group.  The Austrian
finance ministry, which effectively runs Hypo Alpe, submitted a
restructuring plan to the Commission on Feb. 5.


COMMERZBANK AG: Fitch Hikes Lower Tier 2 Debt Rating From 'BB+'
Fitch Ratings has affirmed Commerzbank AG's (CBK) Long-term
Issuer Default Rating (IDR) at 'A+' and Hypothekenbank Frankfurt
AG's (HF) at 'A-'. The Outlooks are Stable. At the same time,
Fitch has upgraded CBK's Viability Rating (VR) and hybrid and
subordinated debt ratings.


CBK's Long- and Short-term IDR, Support Rating (SR), and senior
debt ratings reflect Fitch's view that its status as a large
universal bank in Germany results in an extremely high
probability of state support, as indicated by a Support Rating
Floor (SRF) of 'A+'. After the capital increase in 2013, the
German government keeps its ownership in CBK through the
Financial Market Stabilisation Fund (SoFFin) at around 17%.

HF's support-driven ratings are at their SRF and reflect Fitch's
view of the high likelihood of support from the Federal Republic
of Germany (AAA/Stable), particularly in view of HFs large size
and outstanding issuance in the Pfandbrief market. Fitch expects
that state support, if needed, would be forthcoming via CBK.
Fitch's view of the likelihood of state support reflects HF's
interconnectivity with its ultimate parent's creditworthiness and
its large volume of issued German Pfandbriefe. HF has a letter of
backing (Patronatserklaerung) from CBK and a domination and
profit and loss transfer agreement is in place with its direct
owner, Commerzbank Inlandsbanken Holding GmbH (not rated), a
wholly-owned subsidiary of CBK.

The Stable Outlooks reflects Fitch's expectation that the German
government will continue to support large German banks, including
CBK, as long as the tools for dealing with resolution of large
international banks are not fully developed.


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

Fitch understands that there is broad political will in Germany,
supported by all major parties, to move towards reducing the
implicit state support of systemically important banks in the
country at some point. In addition, the European Union discussion
on the Bank Recovery and Resolution Directive and the Single
Resolution Mechanism aspect of Banking Union are drawing to a
close, with European Parliament votes scheduled for 1Q14 and
representing important steps to curb systemic risks posed by the
banking industry (see 'Fitch Outlines Approach for Addressing
Support in Bank Ratings', 'Bank Support: Likely Rating Paths',
'The Evolving Dynamics of Support for Banks' and 'Sovereign
Support for Banks Update on Position Outlined In 3Q13' at This follows Germany's implementation of a
Restructuring Act in 2011. Although Fitch does not expect to
immediately remove support incorporated into some EU bank
ratings, these developments highlight potential risks for CBK's
IDR and senior debt ratings.

CBK's SRF would be revised down and its SR, IDRs and senior debt
ratings downgraded if Fitch concludes that potential sovereign
support has weakened relative to its previous assessment. Given
CBK's VR is 'bbb', any support-driven downgrade of the bank's
Long-term IDR and senior debt ratings would be limited to four


The upgrade of CBK's VR by one notch reflects the bank's progress
with its extensive restructuring plans as well as Fitch's
expectation that the profitability of CBK's core businesses
should mildly improve. Fitch views CBK's profitability and asset
quality and its risk appetite as important rating drivers. Fitch
believes that the operating profit of the Private Customers
segment should improve in 2014 from low levels, reflecting CBK's
growth in mortgage lending and a benign environment for
investment products. In addition, the upgrade is based on the
assumption that CBK can stabilize the operating profit in its
Mittelstandsbank segment, which caters for its medium-sized
corporate customers.

In Fitch's view, CBK is now better positioned to protect its
franchise in a competitive domestic market. However, its non-core
assets (NCA) still pose downside risks. CBK's performance has
been helped by the favorable German economy and notably the low
number of corporate insolvencies in Germany. However, CBK is
still exposed to concentration risks and troubled European
markets, which have absorbed a substantial share of its profits
in recent years.

The VR is most sensitive to downside risks from non-core
commercial real estate, especially in Spain, and its shipping
portfolio, for which 2014 will be another difficult year. Fitch
expects that CBK would be able to absorb a potential
deterioration of the asset quality in its core businesses. Fitch
notes that further successful deleveraging of its NCA,
specifically of its exposure in southern Europe and shipping
loans, or a broader and structural recovery of the Southern
European countries would further underpin CBK's higher VR.

If the improvement of CBK's core businesses is delayed or fails,
most likely in the form of falling revenues coupled with higher
loan impairment charges, which are currently relatively low in
the core businesses, Fitch could reverse its view on CBK's VR.

In this context, Fitch expects that the ECB's comprehensive
assessment of large European banks' assets in 2014, including an
extensive risk assessment, asset quality review and stress test,
will not result in a material capital shortfall at CBK. Although
only limited details of the actual test have been reported, Fitch
has conducted some stress testing of CBK's phase in Basel III CT1
ratio, including assumptions about continued deleveraging of NCA,
and concludes that it would take severe stressing, for example of
CBK's shipping portfolio, to push the CT1 ratio below 8%. Fitch
believes that such a scenario cannot be fully excluded but is not

Fitch expects CBK's capitalization and funding franchise to
remain stable. These are moderately important rating drivers at
this stage as CBK has made considerable progress in both areas
over the past few years compared with its lagging performance in
restoring profitability.


Fitch has upgraded CBK's and HF's Tier 1 and Tier 2 securities as
a result of the upgrade of CBK's VR which is the anchor rating
for these instruments. Subordinated debt and other hybrid capital
issued by CBK are all notched down from CBK's VR in accordance
with Fitch's assessment of each instrument's respective non-
performance and relative loss severity risk profiles, which vary
considerably. Because HF is in run down and has no VR, Fitch
views CBK's 'bbb' VR as the initial source of anchor for HF's
junior debt ratings, given Patronatserklaerung and the existence
of a profit and loss transfer agreement.

The Tier 1 instruments issued by Commerzbank Capital Funding
Trust II have been upgraded to 'BBB-', one notch below CBK's new
VR, because on 16 January 2014, CBK reported that it was
complying with a court ruling which forced it to elevate the
trust preferred securities to the same Lower Tier II capital
class as the silent partnership certificates of Dresdner Funding
Trust IV (Dresdner IV), to give them the same senior liquidation
preference as the Dresdner IV securities and remove the profit-
dependent trigger while maintaining the securities' accrual of
capital payments. Similar to Dresdner IV the new Commerzbank
Capital Funding Trust II instruments reflect minimal incremental
non-performance risk characteristics relative to CBK's VR (zero
notches) plus one notch for loss severity.

The Tier 1 securities, including HT1 Funding Capital, which have
a distributable profit trigger, are rated four notches below
CBK's VRs, two notches each for high loss severity and high non-
performance risks. Dresdner Funding Trust I, Tier 1 securities
which have a regulatory capital ratio trigger, have been upgraded
to 'BB', three notches below CBK's new VR, two notches for loss
severity and now only one notch for performance risk. In Fitch's
view, the fact that Dresdner Funding Trust I has always paid its
coupon whereas Tier 1 instruments with a distributable profit
trigger have not are reflected in a notch difference.

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

Lower Tier 2 securities issued by CBK are rated one notch below
CBK's VR in order to reflect higher loss severity compared to
senior unsecured debt instruments (one notch).

Subordinated debt and other hybrid capital issued by CBK and
associated SPVs are primarily sensitive to any change in CBK's
VR. In addition, CBK's Capital Funding Trust I securities would
be upgraded if CBK decides to restructure the instruments and
change the documentation to mirror the documentation of CBK's
Capital Funding Trust II securities.

Fitch views CBK's 'bbb' VR as the initial source of support for
HF's subordinated debt. The degree of notching relative to CBK's
VR reflects Fitch's opinion that there is greater non-performance
risk on HF's sub debt than there is on CBK's own subordinated
debt (rated 'BBB-'). This is because HF is in wind down and its
large size relative to CBK means a situation could arise where
additional support for HF ultimately needs to be channelled from
federal sources.

Under such circumstances, support for subordinated debt cannot be
assumed, given the precedent in the EU for subordinated debt
burden sharing. The rating of the subordinated debt is therefore
sensitive to an increase in the likelihood of such an event

Fitch also notes that in 2012 CBK decided not to divest its
subsidiary Eurohypo, now HF, but to run the company down. As a
bank in wind-down, HF is not a viable entity.

EUROHYPO Capital Funding Trust I and EUROHYPO Capital Funding
Trust II were upgraded in December 2013 to reflect that the
trustee has made forgone capital payments to the holders of the
trust preferred securities for the years 2009-2012 in line with
HF's agreement and that the trigger for coupon payments of the
trust preferred securities has stopped being dependent on
sufficient distributable profit in HF's unconsolidated German
GAAP accounts but essentially "must"-payments as long as the
profit and loss transfer agreement exists. In January, HF
announced EUROHYPO Capital Funding Trust LLC's intention to
redeem the Company Class B Preferred Securities in whole on 24
February 2014.

EUROHYPO Capital Funding Trust I and II's ratings are sensitive
to the termination of the profit and loss transfer agreement and
to changes of Commerzbank's VR.


Commerzbank U.S. Finance Inc is a wholly owned subsidiary of CBK.
The Short-term rating of its Commercial Paper Programme is
equalized with CBK's IDR and reflects the likelihood of systemic
support. The Short-term rating of the commercial paper program is
sensitive to the same factors that might drive a change in CBK's

HF's subsidiary Hypothekenbank Frankfurt International S.A.'s
(HFI) ratings are in line with its 100% parent HF as the
subsidiary benefits indirectly from the support provided to the
parent, as well as having a Patronatserklaerung from HF. As a
result the ratings sensitivities for HFI are the same as those
for HF.

The ratings actions are as follows:

Commerzbank AG

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

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

Hybrid capital instruments issued by Commerzbank:

Dresdner Funding Trust I's dated silent participation
  certificates (XS0097772965): upgraded to 'BB' from 'B+'.
Commerzbank Capital Funding Trust II (XS0248611047): upgraded to
  'BBB-' from 'B+'
Commerzbank Capital Funding Trust I (DE000A0GPYR7): upgraded to
  'BB-' from 'B+'
UT2 Funding plc upper Tier 2 securities (DE000A0GVS76): upgraded
  to 'BB-' from 'B+'
HT1 Funding GmbH Tier 1 Securities (DE000A0KAAA7): upgraded to
  'BB-' from 'B+'


Long-term IDR: affirmed at 'A-', Outlook Stable
Short-term IDR: affirmed at 'F1'
Support Rating: affirmed at '1'
Support Rating Floor: affirmed at 'A-'
Senior unsecured debt: affirmed at 'A-'
Subordinated debt: upgraded to 'BB-' from 'B+'


Long-term IDR: affirmed at 'A-', Outlook Stable
Short-term IDR: affirmed at 'F1'
Support Rating: affirmed at '1'

EUROHYPO Capital Funding Trust I/II preferred stock
(XS0169058012, DE000A0DZJZ7): upgraded to 'BB-' from 'B+'


DRYSHIPS INC: Ocean Rig Enters Into Amendment of Term Loan
DryShips Inc., an international provider of marine transportation
services for drybulk and petroleum cargoes, and through its
majority owned subsidiary, Ocean Rig UDW Inc., of offshore
deepwater drilling services, on Feb. 7 disclosed that Ocean Rig,
and its wholly owned subsidiaries, Drillships Financing Holding
Inc., and Drillships Projects Inc., have entered into an
Amendment and Restatement Agreement to the Credit Agreement dated
as of July 12, 2013, as amended, among Ocean Rig, DFHI,
Drillships Projects, the lenders from time to time party thereto
and Deutsche Bank AG New York Branch, as administrative and
collateral agent which originally comprised of tranche B-1 term
loans in an aggregate principal amount equal to US$1.075 billion
and tranche B-2 term loans in an aggregate principal amount equal
to US$825.0 million. Pursuant to the Amendment and Restatement
Agreement, the existing Tranche B-2 Terms Loans have been
refinanced with additional new Tranche B-1 Term Loans the result
of which is that DFHI currently has approximately US$1.9 Billion
of Tranche B-1 Term Loans outstanding.

All Tranche B-1 Term Loans remain guaranteed by Ocean Rig and by
certain existing and future subsidiaries of DFHI and are secured
by certain assets, and by a pledge of the stock of DFHI and each
subsidiary guarantor.

George Economou, Chairman and Chief Executive Officer of the
Company, commented:

"We are pleased with the successful closing of this important
transaction which extends Ocean Rig's debt maturities.  We
effectively refinanced the short-term tranche of the Term Loan B
Facility with a fungible add-on to the long-term tranche.  Post
transaction, the entire US$1.9 billion facility will mature not
earlier than the third quarter of 2020."

                       About DryShips Inc.

Headquartered in Athens, Greece, DryShips Inc. (NASDAQ: DRYS) is
an owner of drybulk carriers and tankers that operate worldwide.
Through its majority owned subsidiary, Ocean Rig UDW Inc.,
DryShips owns and operates 10 offshore ultra deepwater drilling
units, comprising of 2 ultra deepwater semisubmersible drilling
rigs and 8 ultra deepwater drillships, 3 of which remain to be
delivered to Ocean Rig during 2013 and 1 is scheduled for
delivery during 2015.  DryShips owns a fleet of 46 drybulk
carriers (including newbuildings), comprising of 12 Capesize, 28
Panamax, 2 Supramax and 4 Very Large Ore Carriers (VLOC) with a
combined deadweight tonnage of about 5.1 million tons, and 10
tankers, comprising 4 Suezmax and 6 Aframax, with a combined
deadweight tonnage of over 1.3 million tons.

The Company reported a net loss of US$288.6 million on
US$1.210 billion of revenues in 2012, compared with a net loss of
US$47.3 million on US$1.078 billion of revenues in 2011.

The Company's balance sheet at Dec. 31, 2012, showed
US$8.878 billion in total assets, US$5.010 billion in total
liabilities, and shareholders' equity of US$3.868 billion.

                       Going Concern Doubt

Ernst & Young (Hellas), in Athens, Greece, expressed substantial
doubt about DryShips Inc.'s ability to continue as a going
concern, citing the Company's working capital deficit of
US$670 million at Dec. 31, 2012, and in addition, the non-
compliance by the shipping segment with certain covenants of its
loan agreements with banks.

As of Dec. 31, 2012, the shipping segment was not in compliance
with certain loan-to-value ratios contained in certain of its
loan agreements.  In addition, as of Dec. 31, 2012, the shipping
segment was in breach of certain financial covenants, mainly the
interest coverage ratio, contained in the Company's loan
agreements relating to US$769,098,000 of the Company's debt.  As
a result of this non-compliance and of the cross default
provisions contained in all bank loan agreements of the shipping
segment and in accordance with guidance related to the
classification of obligations that are callable by the creditor,
the Company has classified all of its shipping segment's bank
loans in breach amounting to US$941,339,000 as current at
Dec. 31, 2012.


BROOKLANDS 2004-1: Fitch Lowers Rating on Class D Notes to Dsf
Fitch Ratings has downgraded Euro Reference-Linked Notes 2004-1
Limited (Brooklands 2004-1)'s class D notes and affirmed the
others, as follows:

Class A2 (ISIN XS0193141891) affirmed at 'CCsf'
Class B (ISIN XS0193142436) affirmed at 'Csf'
Class C-E (ISIN XS0193142782) affirmed at 'Csf'
Class C-Y (ISIN XS0193142865) affirmed at 'Csf'
Class D (ISIN XS0193143590) downgraded to 'Dsf' from 'Csf'
Class E (ISIN XS0193143913) affirmed at 'Dsf'

Key Rating Drivers
The class D notes have been downgraded as EUR11.3 million has
been written off their notional as part of credit protection
payments made on the reference pool. Furthermore the entire
notional balance (EUR13.5 million) of the class E notes has now
been written off as part of the same series of payments.

The affirmation of the class A2 to C-Y and class E notes reflects
the notes' levels of credit enhancement relative to the reference
portfolio credit quality. Fitch considers it unlikely that
principal will be repaid at maturity. The reference pool
currently consists of 47.8% (EUR279 million) sub-investment grade
assets and 7% (EUR41 million) assets rated 'CCC' or below.

Credit protection payments were made on two assets Deco 6-UK2X C
and Deco 6-UK2X D, which were classified as defaulted in November
2012. The payment amount for the two assets was determined on the
last auction date at EUR14.9 million. There are now no credit
protection payments outstanding. Seven credit protection payments
have been made over the lifetime of the deal for a total EUR47.5
million on EUR47.8 million of assets.

The issuer, Brooklands, is a special purpose vehicle incorporated
with limited liability under the laws of the Cayman Islands.
Brooklands provides protection to UBS AG, London Branch on a
portfolio of reference credits with an initial notional value of
EUR750 million.

The class A to E notes' ratings address the full and timely
payment of interest and ultimate payment of principal by the
final maturity. The class A1-b notes were redeemed in full in
June 2013. The scheduled maturity date for the remaining notes is
in June 2014 and the legal final maturity date is in 2054. The
margins for any notes still outstanding after the scheduled
maturity date are to increase.

Rating Sensitivities

All the outstanding notes are at distressed rating levels and as
such are unlikely to be affected by any further deterioration in
the respective underlying asset portfolios.

ELVERYS SPORTS: Sports Direct Welcomes News of Examiner
Irish Times reports that UK sport retailer Sports Direct has
welcomed the news that a temporary examiner has been appointed to
troubled chain Elverys Sports.

"We hope that a permanent appointment over the next week will
lead to a fair and transparent process over the future ownership
of the Elverys sports chain," the report quoted Sports Direct
Chief Executive Dave Forsey as saying.

Irish Times notes that the group, which is owned by UK
billionaire Mike Ashley, sought to be allowed into the bidding
process for Elverys, which was the subject of a EUR10 million
management buyout.

National Asset Management Agency (NAMA) took the decision to seek
the appointment of the examiner amid fears that Sports Direct or
Stafford Group-owned Lifestyle Sports could mount a legal
challenge to the so-called "pre-pack" receivership arranged to
sell the business to management, the report notes.

The report discloses that Mr. Ashley said the company was
prepared to pay a 25 per cent premium for Elverys, with Mr.
Forsey describing the firm as "an excellent strategic fit" for
Sports Direct in Ireland.  The deal would give the company, which
has a stake in the Heatons retail chain, access to the replica
rugby kit market, the report relays.

MOUNT CARMEL HOSPITAL: Centric Health Makes Fresh Bid
Tom Lyons at The Irish Times reports that Centric Health has made
a fresh approach to buy Mount Carmel Hospital in south Dublin,
which went into liquidation in January.

It follows RAS Medical Group, the owner of the Park West Clinic
in Dublin 12 and other health businesses, indicating its interest
last week to the hospital's liquidator RSM Farrell Grant Sparks,
The Irish Times discloses.

According to The Irish Times, under any new owner, Mount Carmel
will almost certainly not be a maternity hospital but will focus
instead on offering other facilities to patients.

The Centric plan is understood to envisage the hospital exiting
maternity services and providing various other medical services,
including its speciality and diagnostic services, as well as
offering suites to consultants in St James's Hospital in Dublin
where they can meet private clients, The Irish Times notes.

Centric previously made an offer to acquire Mount Carmel before
Christmas from the National Asset Management Agency, The Irish
Times recounts.  Initially, this was accepted but, after due
diligence, Centric reduced its price, The Irish Times states.
Ultimately NAMA did not secure a bid it found satisfactory,
causing it to put the hospital into liquidation, The Irish Times

Prospective buyers prior to the liquidation were concerned about
the cost of funding redundancies among the hospital's 300 staff
and about the expense of investing in the hospital to upgrade it
and reorient its offering away from maternity services, The Irish
Times says.  This caused buyers to fall away after 49 different
parties initially expressed an interest in buying the hospital,
which was founded in 1949, The Irish Times notes.

According to The Irish Times, as the hospital is now in
liquidation and its 300 staff have been made redundant, the
economics of keeping Mount Carmel open as a medical facility have
changed fundamentally, making it more attractive to prospective

Mount Carmel Medical (South Dublin Ltd.) operates the Mount
Carmel Hospital in Churchtown, Dublin.


* ITALY: Banks May Face Capital Shortfall of Up to EUR15 Bil.
Sonia Sirletti and Flavia Rotondi at Bloomberg News report that
Italian banks, which have raised money, sold assets and cut costs
to boost capital, may face a shortfall of as much as EUR15
billion (US$20 billion) as regulators scrutinize their balance
sheets this year.

"We are confident that the Italian banks will pass the stress
test exercise without major problems," Bloomberg quotes
Giovanni Sabatini, general manager of the Italian banking
association, as saying in an interview in Rome.  He agrees with
an estimate made by the Bank of Italy of a potential capital
shortfall of EUR10 billion to EUR15 billion, Bloomberg notes.

Assets of 15 Italian lenders, including UniCredit SpA (UCG) and
Intesa Sanpaolo SpA (ISP), are being reviewed by the European
Central Bank as part of a comprehensive assessment before it
takes over banking supervision for the euro area in November,
Bloomberg discloses.

"There are several options for lenders to fill the eventual
capital gap found during the scrutiny and most will depend on the
timing imposed by the ECB," Mr. Sabatini, as cited by Bloomberg,
said.  He said that those alternatives may include share sales,
disposals and additional deleverage, Bloomberg relates.

The stress test is the third and final stage of the ECB's
Comprehensive Assessment, an evaluation of whether lenders can
survive a downturn, Bloomberg notes.


PORTUGAL TELECOM: S&P Retains 'BB' CCR on CreditWatch Developing
Standard & Poor's Ratings Services said that its 'BB' long-term
corporate credit ratings on Portuguese telecommunications
provider Portugal Telecom SGPS S.A. (PT) and its wholly owned
finance subsidiary Portugal Telecom International Finance B.V.
(PTIF) remain on CreditWatch with developing implications.  S&P
placed the ratings on CreditWatch developing on Oct. 4, 2013.

At the same time, S&P affirmed the 'B' short-term corporate
credit ratings on PT and PTIF.

The CreditWatch developing status indicates that S&P could raise,
lower, or affirm the ratings.  It reflects, on the one hand, the
likely benefits for PT of the proposed merger between PT and
Brazilian telecom company Oi to form a new Brazilian listed
entity, and, on the other, S&P's view of continued downgrade risk
for PT if the merger were to fail.

PT has announced a number of liability management initiatives for
which it seeks creditors' approval, this being a condition to
completing the merger.  S&P continues to understand that the
merger plan intends to offer adequate protection to creditors of
PT and PTIF and exposure to the enlarged Oi group.

Should the announced merger with Oi complete successfully, S&P
might lift the long-term rating on PT and its related outstanding
issues to reflect the likely higher credit quality of the new
combined entity, assuming the guarantees then in place were in
line with S&P's guarantee criteria.

Conversely, should the merger fail, S&P could lower the rating on
PT by one notch, given the relentless pressures on PT's domestic
EBITDA and S&P's expectation of weakening credit metrics.

S&P aims to resolve the CreditWatch status when the transaction
outcome is known, which S&P understands could be by June 2014.


ALLIANCE OIL: S&P Lowers Corp. Credit Rating to 'B-'
Standard & Poor's Ratings Services lowered its long-term
corporate credit rating on Russia-based Alliance Oil Co. to 'B-'
from 'B'. S&P also lowered its Russia national scale rating on
the company to 'ruBBB' from 'ruA-'.

At the same time, S&P lowered its issue rating on the company's
senior unsecured debt to 'B-' from 'B'.  The '4' recovery rating
on this debt remains unchanged.

S&P also changed the CreditWatch implications for the issue,
issuer, and Russia national scale ratings to negative from
developing.  S&P had originally placed these ratings on
CreditWatch developing on Nov. 6, 2013.

The downgrade reflects S&P's expectation of a significant
increase in Alliance Oil's leverage (debt to EBITDA) and its
potentially more aggressive financial policy.  S&P understands
from management that the US$1.2 billion in debt raised by parent
Alliance Group to purchase all outstanding stock in Alliance Oil
in December 2013 will effectively become Alliance Oil's
liability.  As a result, S&P expects Alliance Oil's ratio of
adjusted debt to EBITDA to increase to more than 5x in 2014, from
3.4x in the 12 months ended Sept. 30, 2013.  The ratio of funds
from operations (FFO) to adjusted debt will likely decrease to
about 10% or lower, from 19% over the same period.  S&P also
believes that Alliance Oil's financial policy, particularly
regarding investments and shareholder distributions, may become
more aggressive.  Alliance Group is privately owned by Russia's
Bazhaev family of businessmen, who S&P understand aim to maintain
Alliance Oil separate from other family assets. Therefore, we do
not foresee any potential for parental support to Alliance Oil in
the future.

S&P changed the implications of our CreditWatch listing to
negative from developing because of the potential squeeze S&P
foresees on Alliance Oil's liquidity owing to the US$1.2 billion
in additional debt.

S&P derives its rating on Alliance Oil from its 'b-' anchor,
reflecting the company's "weak" business risk and "highly
leveraged" financial risk profiles.

In S&P's assessment of Alliance Oil's business risk, it factors
in the company's position as a small private player in the
Russian oil industry.  It benefits from a natural hedge through
taxes and foreign exchange.  However, its earnings are more
volatile than local peers' because of its large downstream
segment, and because tax holidays on some of its large fields
increase profitability but reduce the hedging effect in the
upstream segment.

S&P's assessment of Alliance Oil's financial risk incorporates
its expectation of a substantial increase in the company's
leverage following Alliance Group's full ownership, and owing to
negative free operating cash flow (FOCF). Alliance Oil has a
large investment program aiming to increase production and
modernize its key refinery.  In addition, S&P thinks Alliance Oil
will adopt a more aggressive financial policy under the new
shareholding structure, which may also push up the company's

In S&P's base case, it assumes the following:

   -- It now includes Alliance Group's $1.2 billion in Alliance
      Oil's debt, as it believes that the company will repay this
      debt through its cash flows over time.

   -- S&P thinks the company's heavy capital expenditures will
      continue as it modernizes its refinery.

   -- S&P's Brent oil price assumption is $105 per barrel (/bbl)
      in 2014, $100/bbl in 2015, and $95/bbl thereafter.

   -- S&P don't net any cash from Alliance Oil's adjusted debt
      under its criteria because of the company's weak business
      risk profile.

Based on these assumptions, S&P arrives at the following credit
measures at year-end 2014:

   -- Strongly negative FOCF.

   -- Debt to EBITDA exceeding 5x.

   -- FFO to debt at about 10%.

The CreditWatch reflects the potential squeeze S&P foresees on
Alliance Oil's liquidity, owing to its US$1.2 billion in
additional debt.  S&P plans to resolve its CreditWatch within 90
days or once it has clarification on the implications of this
additional debt for the company and S&P is able to assess its
progress in addressing potential liquidity issues.

S&P could lower the ratings if the US$1.2 billion in debt created
any tightening in Alliance Oil's liquidity, namely short-term
debt maturities or covenant breaches.

S&P would likely affirm the ratings on Alliance Oil if its debt
maturity profile stayed manageable and it continued to comply
with covenants.

PERESVET BANK: S&P Assigns B+ Counterparty Rating; Outlook Stable
Standard & Poor's Ratings Services said it had assigned its 'B+'
long-term and 'B' short-term counterparty credit ratings to
Russia-based JSCB Peresvet Bank.  The outlook is stable.  At the
same time, S&P assigned its 'ruA+' Russia national scale rating
to the bank.

The ratings on Peresvet Bank factor in the inherent economic and
industry risks faced by a commercial bank operating in Russia,
reflected in S&P's 'bb' anchor.  The ratings also reflect S&P's
view of the bank's "moderate" business position, "moderate"
capital and earnings, "moderate" risk position, "average"
funding, and "adequate" liquidity, as S&P's criteria define these
terms. The stand-alone credit profile (SACP) is 'b+'.

S&P considers Peresvet Bank's business position to be "moderate."
This balances the bank's limited pricing power and franchise and
its business concentrations with its access to fairly lucrative
clients and proven track record of strong operational
performance. With assets of Russian ruble (RUB) 91.3 billion
(about US$2.78 billion) according to International Financial
Reporting Standards as of June 30, 2013, Peresvet Bank is a
midsize Russian bank with a unique ownership structure that
includes the Russian Orthodox Church (which controls 48% of
common shares) and the Chamber of Commerce and Industry of the
Russian Federation (24.5%).  S&P believes this ownership
structure, in particular the link with the Russian Orthodox
Church, partly explains the bank's track record of strong
operating performance, because it ensures sustainability of
business flows amid different economic cycles and amid margin
pressure, and strengthens borrowers' willingness to pay their
debt.  The bank primarily focuses on servicing corporate clients,
which it typically attracts through the shareholders.  The bank
has a substantial focus on government-related entities, which
made up about 50% of corporate deposits as of June 30, 2013, and
stemmed from state-owned companies or their direct subsidiaries.
This focus, however, makes Peresvet Bank subject to tight
competition from state-owned and large private banks.  The bank's
regional concentration is fairly high, given that 60%-70% of
business comes from the Moscow Oblast.

"We assess Peresvet Bank's capital and earnings as "moderate,"
reflecting our projection that the risk-adjusted capital (RAC)
ratio before adjustments for concentration and diversification
for the bank will gradually improve to about 6% in 2014-2015 from
5.4% at the end of 2012," S&P said.

In S&P's view, Peresvet Bank's overall risk position is
"moderate."  S&P believes that the bank's loan portfolio is
concentrated compared with that of both local and global peers.

S&P considers Peresvet Bank's funding to be "average."  The bank
is primarily funded by customer deposits, typically corporate,
which constituted 74% of the funding base as of July 1, 2013.
The funding base is well-spread by maturity, leading to a
relatively good stable funding ratio of 108%.

Peresvet Bank's liquidity is "adequate," and it has a liquidity
cushion of about 25% of the balance sheet.  Nevertheless, the
bank's coverage of short-term deposits by liquid assets is weaker
than that of its peers, leaving the bank vulnerable to deposit

The stable outlook reflects S&P's anticipation that the bank will
maintain credit losses and problem loans lower than the system
average, despite economic slowdown in Russia.  S&P expects the
bank will generate sufficient earnings while expanding its
activities, in order to avoid erosion of its capital ratios and
to gradually improve the granularity of its funding base.


PESCANOVA SA: Enters Into Crucial Talks with Creditor Banks
Tobias Buck at The Financial Times reports that Spain's Pescanova
has entered make-or-break talks with more than 100 creditor banks
to try to save stricken frozen fish group Pescanova SA from
liquidation and prevent the biggest industrial collapse since the
start of the Spanish economic crisis.

The Pescanova board wants banks to accept a cut of 70-80% on
loans worth a total of EUR1.8 billion, but says its proposals
have been rebuffed, the FT discloses.  It is now striving to meet
a March 3 deadline, the last day on which proposals to resolve
the debt stand-off can be tabled to the bankruptcy court, the FT

According to the FT, the parties then have another month to
finalize a deal.  If no solution is found by April 3, the group
will be liquidated, putting at risk 2,000 jobs in Spain and
another 12,000 at factories and fish farms in the rest of the
world, the FT states.

Juan Manuel Urgoiti, who was appointed chairman of the board last
September, said the group remained a "viable business" as long as
its debt problems could be resolved, and warned that the
consequences of letting Pescanova fail would be "brutal" for the
Spanish economy, the FT relates.

                        About Pescanova SA

Pescanova SA is a Galicia-based fishing company.  The company
catches, processes, and packages fish on factory ships.  It is
one of the world's largest fishing groups.

Pescanova filed for insolvency on April 15, 2013, on at least
EUR1.5 billion (US$2 billion) of debt run up to fuel expansion
before economic crisis hit its earnings.  The Pontevedra
mercantile court in northwestern Galicia accepted Pescanova's
insolvency petition on April 25.  The court ordered the board of
directors to step down and proposed Deloitte as the firm's


STENA AB: S&P Assigns 'BB+' Rating to Proposed Sr. Secured Loan
Standard & Poor's Ratings Services said that it assigned its
'BB+' issue rating to the proposed senior secured term loan and
proposed senior secured notes, with an anticipated aggregate
principal amount of approximately US$1.1 billion, to be issued by
Sweden-based conglomerate Stena AB.  At the same time, S&P
assigned a recovery rating of '2' to the proposed term loan and
senior secured notes, indicating its expectation of substantial
(70%-90%) recovery for creditors in the event of a payment

In addition, S&P affirmed its 'BB' issue ratings on the
EUR102 million, EUR300 million, EUR200 million, and US$600
million senior unsecured notes issued by Stena.  The recovery
ratings on these existing senior unsecured notes remain unchanged
at '4', indicating S&P's expectation of average (30%-50%)
recovery for creditors in the event of payment default.  S&P
notes that due to a reduction in amortization payments on the
path to default as a result of the proposed transaction, the
recovery prospects for the unsecured notes have reduced, but
remain within the 30%-50% range.

S&P understands that Stena will use the proceeds of the proposed
term loan and senior secured notes to repay in full US$698
million of existing senior secured ship loans, and US$402 million
of outstanding drawings under a Swedish krona (SEK) 6.6 billion
senior unsecured revolving credit facility (RCF).  S&P
understands that as part of the proposed transaction, the limit
on Stena's US$1 billion senior secured RCF will be permanently
reduced to US$500 million.

                        RECOVERY ANALYSIS

The proposed term loan and senior secured notes are to share the
same first-priority liens over Stena's DrillMax and Stena Carron
drill ships.  S&P understands that the proposed term loan and
notes are to rank pari passu and will be guaranteed by Stena and
all of its wholly owned domestic subsidiaries.

The term loan does not benefit from any financial maintenance
covenants.  However, S&P understands that the terms in the
documentation governing both the term loan and notes are
identical and include a suite of nonfinancial covenants and
incurrence covenants, including a restriction on raising
additional debt when the consolidated fixed-charge coverage ratio
is less than 2x.

The recovery rating on the proposed term loan and senior secured
notes is underpinned by Stena's significant asset value in the
form of vessels and real estate.  However, the recovery rating
also reflects the risk of Stena's exposure to multiple
jurisdictions in the event of a default because of the global
distribution of its assets.

In S&P's simulated default scenario, it believes that a payment
default would most likely result from deteriorating operating and
financial performance in Stena's ferry and drilling operations
following a period of unfavorable economic and industry
conditions.  This results in refinancing risk in 2019.

S&P believes that the Stena group is likely to retain its value
as a going concern in the event of bankruptcy, thanks to its
diverse business activities and stable real estate earnings, as
well as the contract-based nature of its drilling business.  At
the same time, S&P believes that the main value available to
unsecured creditors in any reorganization would be that of the
group's vessels and real estate.  For this reason, S&P uses a
discrete asset valuation approach in determining Stena's debt

S&P believes that freight rates and vessel prices are likely to
be depressed in a default scenario.  Consequently, S&P's
estimates of the value of these assets at default (including
committed investments) incorporate discounts of 50%-60% of the
current market values.  Regarding the properties, S&P assumes a
realization value of about 70% of the current market value.  In
addition, S&P assumes that account receivables would yield 75% of
their book value, and S&P discounts the current value of the
inventory by about 50%.  On the basis of these considerations,
S&P estimates the group's stressed enterprise value on emergence
from bankruptcy at about $7 billion.

Although S&P expects recoveries for the proposed senior secured
debt to be 100%, it caps the recovery rating at '2' (70%-90%
recovery), owing to the unknown future location of the vessels,
and likely multijurisdictional uncertain.


FERREXPO PLC: S&P Cuts Corp. Credit Rating to 'B-'; Outlook Neg.
Standard & Poor's Ratings Services lowered its long-term local
currency corporate credit rating on Ukraine-based iron ore pellet
producer Ferrexpo PLC to 'B-' from 'B' and affirmed the long-term
foreign currency corporate credit rating at 'B-'.  The outlook is

At the same time, S&P affirmed the 'B' short-term corporate
credit ratings on Ferrexpo and the 'B-' issue rating on the $500
million senior unsecured notes issued by Ferrexpo Finance PLC.

The recovery rating on the notes is unchanged at '3', indicating
S&P's expectation of meaningful (50%-70%) recovery in the event
of a payment default.

The rating action follows S&P's downgrade of Ukraine and the
lowering of its transfer and convertibility (T&C) assessment to
'CCC+', given that Ferrexpo's core assets are concentrated in

In the increased political turmoil in Ukraine, S&P sees a higher
risk for adverse government interaction and potential operational
and bank support interruptions.  S&P has consequently revised
Ferrexpo's liquidity assessment to "less than adequate."  S&P
understands from Ferrexpo's management that its iron ore mining
operations and exports have not been negatively impacted to date.

At the same time, S&P rates Ferrexpo one notch above its foreign
currency long-term sovereign rating on Ukraine, because S&P
believes there is a material likelihood that Ferrexpo could
withstand a potential sovereign foreign currency default.  This
is because the bulk of Ferrexpo's cash flows are derived from
profitable iron ore exports and because Ferrexpo holds meaningful
cash balances offshore.

"We continue to assess Ferrexpo's business risk profile as
"vulnerable."  The assessment reflects our view of very high
country risk, combined with the volatile and cyclical nature of
iron ore mining, for which we anticipate prices to fall over 2014
owing to significant new capacity.  Our assessment of Ferrexpo's
competitive position as "weak" is because Ferrexpo is a
relatively small player in the global iron ore and iron ore
products industry.  However, thanks to a premium of iron ore
pellets over the benchmark, Ferrexpo benefits from above-average
profitability (about 29% EBITDA margin)," S&P said.

"We continue to assess Ferrexpo's financial profile as
"aggressive."  In our base case, which assumes a drop in iron ore
prices from US$110/metric ton (mt) in 2014 to US$100/metric ton
(mt) in 2015, we expect the company's capital expenditures to
cause some negative free operating cash flow in the coming years,
although we also understand that management may adjust capital
expenditures to market conditions, operating cash flow, and
availability of funding.  Ferrexpo has moderate debt and strong
ratios for the ratings, and we expect the company to report
adjusted debt to EBITDA at below 2.5x for 2013," S&P added.

The negative outlook on Ferrexpo reflects S&P's negative outlook
on Ukraine.

If S&P lowers the sovereign rating and T&C assessment on Ukraine
further, it may lower the rating on Ferrexpo in the absence of
clear evidence that the impact of T&C restrictions on the company
will be limited.

S&P may also lower the rating if there is a threat to the
continuity of Ferrexpo's business stemming from unrest in
Ukraine, a further material increase in VAT receivables, or in
case of declining offshore cash balances, notably if the lenders'
commitment weakens.

A revision of the outlook to stable, or any rating upside, would
be closely related to improved country risks and positive rating
actions on the sovereign.

U N I T E D   K I N G D O M

CONSOLIDATED MINERALS: S&P Raises CCR to 'B+'; Outlook Stable
Standard & Poor's Ratings Services said it raised its long term
corporate credit rating on Jersey-incorporated manganese ore
producer Consolidated Minerals Ltd (Jersey) (ConsMin) to 'B+'
from 'B'.  The outlook remains stable.

At the same time, S&P raised its issue rating on the group's
senior secured notes to 'B+' from 'B'.  The recovery rating on
these notes remains at '3'.

The upgrade reflects ConsMin's stronger-than-expected profit and
free cash flow generation in 2013 and S&P's anticipation of its
continued good performance in 2014.  These results have led to a
significant reduction in the group's financial leverage and
therefore a revision of S&P's assessment of its financial risk
profile to "significant" from "aggressive."  S&P now thinks
ConsMin will report EBITDA of about US$280 million for 2013, and
expect about US$230 million-US$250 million in 2014, with an
adjusted debt-to-EBITDA ratio below 2x.

The stronger performance was supported by improved industry
conditions -- benchmark manganese CIF prices rising to an average
US$5.63 per dry metric tonne unit (dmtu) in 2013 compared with
US$5.07 per dmtu in 2012.  The other key factor was the
significant reduction in cash costs at ConsMin's Australian and
Ghana operations, which S&P expects to be largely sustainable in
2014. This was mostly owing to the transition to owner-operator
mining in Australia, with ConsMin now handling all load and haul
mining operations itself, but also to the group's focus on lower
strip ratio and higher grade pits.  The group's overall cash
costs have been falling to an estimated average of US$2.57 per
dmtu in 2013 from US$3.28 per dmtu in 2012.  ConsMin increased
production in Ghana to 1.8 million tons in 2013 after it signed a
major offtake agreement with Ningxia Tianyuan Manganese Industry
(TMI), China's biggest electrolytic manganese producer.

ConsMin also achieved substantial deleveraging through continued
positive free cash flow generation throughout 2013 because of
moderate capital expenditure (capex).  The group used some of the
cash accumulated to repay about US$130 million of its US$405
million notes throughout 2013, bringing gross debt to about
US$300 million by end 2013, adjusted for operating leases and
provisions for rehabilitation.  Given S&P's estimate of cash
balances of about US$220 million at the end of the year, it
estimates that net debt was close to zero.  In December 2013,
ConsMin launched an offer to buy back more notes, but only $10
million was taken up.

S&P has therefore revised its assessment of ConsMin's financial
risk profile to significant based on the adjusted debt-to-EBITDA
ratio of below 2.0x in 2013 and 2014 under S&P's base case.  S&P
views this ratio as strong for the category, but in its analysis
S&P factors in the very high swings in the group's ratios due to
volatile manganese prices, lack of product diversity and the
fairly high, though improved, cost position in Australia.

"We continue to assess ConsMin's business risk profile as "weak,"
reflecting its cost position in Australia, the lower ore content
of its Ghanaian assets, and its limited scale and scope within
the context of the global mining industry.  The business risk
profile is also constrained by the group's concentrated asset
base, with significant country risk exposure related to its Ghana
operations and its focus on single-product manganese ore, which
we view as one of the most volatile commodities in the mining
industry.  We also see Consmin's concentrated customer base as a
risk factor, because the contract with China's TMI accounts for
about 75% of Consmin's Ghana output," S&P said.

S&P applies a downward adjustment of one notch to ConsMin's 'bb-'
anchor, reflecting its view that the group's business risk
profile is positioned at the low end of the weak category, mainly
because of the historic very high volatility of manganese prices.

S&P's base case assumes:

   -- Benchmark manganese price of about US$5.3/dmtu (CIF 45.5%
      Manganese) in 2014, but lower average price premiums than
      in 2013.

   -- Production volumes of 2 million tons in Ghana and about
      1.6 million tons in Australia, of stable average grades
      compared with 2013.

   -- Broadly stable cash costs supported by the weaker
      Australian dollar.

   -- Limited capex of US$70 million.

   -- No significant shareholder distributions.

Based on these assumptions, S&P expects positive free operating
cash flow and adjusted debt to EBITDA below 2x in 2013 and 2014.

The stable outlook reflects S&P's view that ConsMin will continue
to generate positive free cash flow in 2014, after a very strong
performance in 2013.  Under current supportive prices of
US$5.3/dmtu (CIF 45.5% Mn), S&P would view adjusted debt to
EBITDA of about 2.0x as commensurate with the rating.  S&P
expects industry conditions to remain broadly in line with
2013's.  Given the current strong credit metrics for the rating,
some leeway exists in case of lower-than-anticipated EBITDA.

Rating upside is limited given ConsMin's exposure to highly
volatile manganese prices, high exposure to country risk in
Ghana, and asset and customer concentration.

Rating downside is remote at this stage given the benefits of the
cash cost reduction implemented in 2013, and low debt.  However,
S&P might consider a negative rating action if manganese prices
dropped and remained well below its base case of US$5.3/dmtu for
a prolonged time, leading to sustained negative free operating
cash flow.  A change in the group's financial policy leading to
high shareholder distributions or releveraging could also lead
S&P to consider a negative rating action.

DECO 6: Fitch Affirms 'Csf' Rating on 3 Note Classes
Fitch Ratings has affirmed DECO 6-UK Large Loan 2 plc's notes, as

  GBP117.9m class A2 due July 2017 (XS0235683223) affirmed at
  'CCsf'; Recovery Estimate (RE) revised to 75% from 60%

  GBP34.4m class B due July 2017 (XS0235683736) affirmed at
  'Csf'; RE 0%

  GBP39.3m class C due July 2017 (XS0235684114) affirmed at
  'Csf'; RE 0%

  GBP24.1m class D due July 2017 (XS0235684544) affirmed at
  'Csf'; RE 0%

DECO 6-UK Large Loan 2 plc was originally the securitization of
four commercial loans originated by Deutsche Bank (A/Stable/F1),
which closed in December 2005. Two of the loans have since repaid
in full which led to the full repayment of the class A1 notes in
1Q12. The remaining two loans, both in default, are secured by UK
retail and office assets.

Key Rating Drivers

The affirmations reflect Fitch's unchanged view that there will
be significant losses on the remaining loans -- the GBP115
million Mapeley and GBP99.9 million Brunel loans -- both of which
have defaulted and are in administration. Although the overall
picture remains bleak for noteholders, Fitch has revised the RE
on the class A2 to 75% (from 60%) in light of higher-than-
expected sales proceeds achieved from Mapeley collateral disposed
of since the last rating action.

Mapeley is now secured by only nine commercial assets in England
and one in Scotland having had repayment of GBP55 million from
ten properties sold over the past 12 months. The aggregate gross
sales price achieved was GBP64.3 million, which surpassed their
valuation of GBP44.3 million by a 45% premium -largely due to a
lease extension on one asset and repositioning of another, whose
combined sale price of GBP31.5 million exceeded their valuation
of GBP15 million.

Although clearly positive, the degree of overleveraging and the
higher vacancy in the remaining assets has meant that the loan is
unable to meet any of its interest obligations from rental
receipts given holding costs on vacant properties. Interest on
the loan is now completely serviced by a cash reserve held by the
issuer (funded from a cash trap introduced in 2009), which should
be at least sufficient to see out the term remaining until
interest rate swap expiry/loan maturity in April 2015.

The remaining assets are largely vacant and/or with tenants on
short leases, making them illiquid and subject to vacant
possession valuations. Fitch does not expect the positive trend
to continue, and projects loan losses in the region of GBP80

The Brunel loan is secured by the 490,113 sq ft Brunel shopping
centre in Swindon town centre. The asset was last valued at
GBP87 million in late 2011 following its transfer to special
servicing, which was due to persistent breaches in the loan debt
service coverage ratio covenant resulting from high tenant
arrears and weakening occupational demand.

Debt service is now in excess of 3x following the expiry of the
interest rate swap in April 2012 (loan maturity). While still
underperforming, held back by an inefficient layout, net
operating income from the shopping centre has stabilized, with
tenant arrears and physical vacancy (now at 7% by area) both
having reduced while the loan has been in special servicing.
Restoring footfall, and paving the way for a reduction in
economic vacancy (close to 20%), would likely require significant
capital expenditure. As this redevelopment is not plausible until
the loan is resolved, recovery proceeds will remain depressed,
with Fitch estimating recoveries of GBP55 million-GBP65 million
(and losses of GBP35 million-GBP45 million).

Rating Sensitivities

The weak characteristics of both loans will continue to constrain
the ratings of all classes of notes within the distressed
categories, although REs may be adjusted over time.

Fitch estimated 'Bsf' recoveries sum to GBP89 million.

GRAHAM WOOD: Seeks Court Protection From Creditors
Barry O'Halloran at The Irish Times reports that Graham Wood
Structural is seeking court protection from its creditors.

According to The Irish Times, the company has filed notice of its
intention to appoint administrators.  Such a move means that it
will get protection from any legal action by creditors seeking to
recover their debts from the company, The Irish Times notes.

The business lost GBP1.5 million in 2011 and GBP1.2 million in
2012, The Irish Times discloses.

West Sussex-based Graham Wood is an English subsidiary of
troubled building group Siac.  The company specializes in complex
structural steel projects.  It employs 75 people.

LINENHALL PROPERTY: Collapses Into Administration
Insolvency News reports that two Liverpool-based property
companies have gone into administration reflecting the state of
the market.

Linenhall Property Investments Ltd and its subsidiary, Moorfields
Property Ltd, were owned by Merseyside solicitor Paul Rooney,
founder of the Paul Rooney Partnership, according to Insolvency
News.  The companies owned a number of property assets in
Liverpool, Chester and Bootle and did not employ any staff, the
report notes.

Kerry Bailey and Graham Newton of BDO have been appointed joint
administrators to the two firms on January 21, 2014.

"The joint administrators are seeking buyers for the assets of
the company, and are working to maximize value for the benefit of
the creditors," the report quoted Kerry Bailey, BDO business
restructuring partner, as saying.

The report notes that both companies filed accounts to Companies
House for the year ending March 31, 2013, showing a decrease in
market value of the properties, a drop in occupancy levels and
the breach of bank covenants.  The report relates that posted
towards the beginning of January, the accounts for Linenhall
Property Investments were prepared representing the company as
other than a going concern.

According to the accounts, Linenhall and Moorfields owe bank
loans worth GBP500,000 and GBP9.3 million respectively, both due
within one year, the report notes.

There are mortgages over the properties and in relation to the
bank loans, Rooney had provided a personal guarantee of
GBP755,000, the report relates.

MAYO SEVEN: Brady Sullivan Steps in Acquire Center At Keene
Meghan Pierce at Union Leader reports that the historic Colony
Mill Marketplace and adjacent shopping center The Center at Keene
are set to be revitalized as a new owner is ready to step in.

Manchester-based Brady Sullivan Properties plans to purchase and
revitalize the two struggling shopping centers, according to
Union Leader.  The report relates that Brady Sullivan Properties
principal partner Arthur Sullivan said Monday the company hopes
to close on the properties.

The adjacent shopping centers have been struggling to maintain
tenants since being placed in receivership four years ago after
the previous owner Mayo Seven LLC defaulted on its mortgage
payments, the report notes.

Because a court-appointed property firm was handling the building
since it went into receivership, tenants have not been getting
the attention they need from management, Mr. Sullivan said, the
report notes.  Mr. Sullivan, the report relates, said he has
already been contacted by former tenants of the Colony Mill that
want to return after Brady Sullivan purchase the property.

The Colony Mill was originally built in 1775 as a saw and grist
mill.  The mill was converted into retail space in the 1980s. The
city currently assesses the property at $4.6 million.

The Center at Keene was built in the late 1980s and is assessed
at $5.1 million.

PUNCH TAVERNS: Publicans Could Face Cash Crisis if Pub Calls Time
Metro News reports that Publicans across the country could lose
thousands of pounds each if Punch Taverns is forced into

Tenants tied to Punch Taverns, which has 4,100 pubs in Britain,
are required to lodge a security deposit with the company -- in
some cases more than GBP20,000, according to Metro News.

The report relates that the value of these deposits is thought to
total about GBP22.6 million.

Landlords fear the money could be lost if Punch Taverns fails in
its fourth attempt to restructure its debts on Valentine's Day,
when bond holders are set to vote on the latest proposals, the
report notes.

"My concern is, when they go into administration, the company
will get chopped up into small units, 200 pubs say, and sold on.
I fear I'll be trying to get my money back from Punch and have to
find a new deposit for the new owners," the report quoted Chris
Lindesay, the landlord of the Sun Inn, Dunsfold, Surrey, as

The report notes that Punch Taverns has spent 14 months trying to
restructure GBP2.3 billion of debts, created by its over-
ambitious expansion.

The security deposits could be used for other purposes if the
company defaults as they are not protected separately under trust
arrangements, the report relates.

The report discloses that major creditors indicated they were
likely to oppose the restructuring despite Punch Chairman Stephen
Billingham saying failure to agree 'will lead to a much worse
outcome with considerable uncertainty for the business.'

A spokesman for Punch said: "An end to uncertainty is critical
for Punch Taverns and its tenants," the report adds.

                        About Punch Taverns

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

As reported in the Troubled Company Reporter-Europe on Feb. 10,
2014, Nathalie Thomas at The Telegraph said that lenders to
Punch Taverns are working on a rival plan to restructure the pub
group's GBP2.3 billion debt pile.  According to The Telegraph, it
is understood that advisers to several groups of creditors are
putting together an alternative solution to the company's debt
woes ahead of a crunch vote.

ROSEMARY CONLEY FOOD: Goes Into Administration, Cuts 6 Jobs
BBC News reports that two companies headed by health guru
Rosemary Conley have gone into administration.

Leicestershire-based Rosemary Conley Food and Fitness Ltd and its
sister business Quorn House Publishing Ltd were put into
administration, according to BBC News.

The report relates that six staff have been made redundant, but
Rosemary Conley Classes are not affected, because they are run as
independent franchises.  The report relays that Mrs. Conley said
it had been a "difficult decision" to make.

"It is business as usual for all the classes around the country.
But for the core business the board and I have had to make this
difficult decision," the report quoted Mrs. Conley as saying.

Mrs. Conley, the report notes, added that she had invested a lot
of her own money into the business and had not drawn a salary for
several months.

Mark Hopkins of Elwell, Watchorn and Saxton has been appointed
joint administrator.

Rosemary Conley Food and Fitness Ltd is the businesswoman's
lifestyle company, and sells slimming and health products, as
well as fitness regimes.  Quorn House Publishing Ltd makes the
Rosemary Conley magazine.

* UK: Administration Rescued Fewer Stores in 2013
CITY A.M. News reports that the number of stores surviving when
major retailers fall into administration dropped significantly in
2013 in the United Kingdom, despite interest rates being held at
historically low levels.

Restructuring and insolvency firm FRP Advisory, the proportion of
shops staying open when big retail chains go into administration
has dropped, from 50 per cent in 2012 to only 35 per cent during
last year, according to CITY A.M. News.

The report notes that in 2013, only 700 of the 2,000 stores
affected managed to stay open, while 11,000 jobs were lost out of
21,100 at the high street stores that were restructured.

"The economy will no longer support anyone with a broken model.
For many of the retailers which entered administration last year
there were fundamental questions to address concerning their
offering and the market they were chasing, rather than just
questions of financial structures," the report quoted Glyn
Mummery, partner at FRP Advisory, as saying.

Contrary to the troubling climate for some high street outlets,
new data released today by the British Retail Consortium (BRC)
show triple-digit increases in online searches for UK retailers
from export markets like Germany and Russia, showing the strength
of the internet as a medium for retail, CITY A.M. News relates.


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.

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

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