TCREUR_Public/140502.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, May 2, 2014, Vol. 15, No. 86



INTERNATIONAL BANK: Moody's Alters Ba3 Rating Outlook to Positive


WAGNER & CO: Solar Firm Files For Insolvency


EUROBANK: EU Commission Approves State Rescue Plans


CAPITAL MORTGAGE: S&P Puts B+ Rating on CreditWatch Negative
FRANCO TOSI: Parties May Bid for Business Unit Until July 4


LIEPAJAS METALURGS: Unit Could Request Legal Protection Process


EKSPORTFINANS ASA: Moody's Affirms Ba3 Issuer & Sr. Debt Ratings


CYFROWY POLSAT: S&P Affirms 'BB' CCR; Outlook Stable
METELEM HOLDING: S&P Raises CCR to 'BB'; Outlook Stable


VINARTE: Creditors Approve Assets Sale to Red Gate


TENEX-SERVICE: S&P Lowers ICRs to 'BB+/B'; Outlook Negative


CODERE SA: Gets More Time to Negotiate EUR1.1-Bil. Debt Deal
PESCANOVA SA: Reaches Debt Accord With Creditors


UKRAINE: IMF Approves US$17-Bil. Rescue Deal

U N I T E D   K I N G D O M

BARCLAYS PLC: To Announce Creation of Bad Bank Next Week
CO-OPERATIVE BANK: Britannia Merger "Exacerbated" Problems
KPL CONTRACTS: Some of Assets Stolen, Administrators Say
* London's New Bitcoin Exchange Hopes to Avoid Mt. Gox Fate


* BOOK REVIEW: A Legal History of Money in the United States



INTERNATIONAL BANK: Moody's Alters Ba3 Rating Outlook to Positive
Moody's Investors Service has changed to positive from stable the
outlook on the following global scale ratings of International
Bank of Azerbaijan: long-term local- and foreign-currency deposit
ratings of Ba3, long-term foreign-currency senior unsecured debt
rating of Ba3, and long-term foreign-currency subordinated debt
rating of B1. Concurrently, Moody's affirmed all existing
ratings. The bank's standalone E+ bank financial strength rating
(BFSR), mapping to a baseline credit assessment of b3 remains on
stable outlook

Moody's rating action is largely based on International Bank of
Azerbaijan's audited financial statements for 2013, prepared
under IFRS.

Ratings Rationale

The outlook change to positive from stable is driven by
International Bank of Azerbaijan's continued progress in
strengthening its standalone credit profile and Moody's
expectation that the banks financial indicators will remain on a
sustainable trend over the next 12-18 months. The rating action
reflects the bank's (1) improved asset quality indicators; (2)
strengthened capital base; At the same time, the ratings remain
constrained by very high concentration levels in the bank's loan
book, its still relatively low core capital level and moderate

Strengthened Capital Adequacy, Supported By Capital Injection and
Improved Internal Capital Generation

During 2012-13, International Bank of Azerbaijan materially
strengthened its capital base, albeit from a fairly weak level
and Moody's expects the bank to further strengthen its capital
levels over the next 12-18 months. The rating agency notes that
in October 2013, International Bank of Azerbaijan adopted a
capital-raising plan -- aiming to inject AZN500 million ($637
million) over the next four years. Moody's believes International
Bank of Azerbaijan's capital buffer will be sufficient to absorb
expected losses and support lending growth (with expectations of
20% growth in 2014) under the rating agency's central scenario,
considering improved internal capital generation. According to
the audited IFRS report, the bank's Tier 1 and Total capital
ratios (under Basel I) improved to 7.2% and 12.6%, respectively,
as at December 31, 2013 (year-end 2012: 6.7% and 11.8%; year-end
2011: 4.95% and 7.60%), while the bank's regulatory capital
adequacy ratio (CAR) exceeded 13% in 2013.

Asset Quality Has Improved and Will Remain Stable

Moody's notes that International Bank of Azerbaijan's asset-
quality metrics improved in recent years. According to the
audited IFRS report, non-performing loans (NPL, defined as loans
90+ days overdue) accounted for around 6.5% of gross loans in
2013 (2012: 7.8%; 2011:12.4%). Moreover, loan-loss reserves
accounted for 9.7% of gross loans at year-end 2013, thereby
providing sufficient coverage (around 150%) of NPLs.

Moody's expects International Bank of Azerbaijan's asset quality
to remain stable over the next 12-18 months, supported by the
favorable operating environment, but notes that the bank's focus
on large corporate customers and participation in large-scale
projects has led to significant single-borrower loan
concentrations in relation to the bank's equity.

Profitability Has Stabilized and Will Benefit From Reduced
Funding Costs

International Bank of Azerbaijan's profitability has stabilized
in recent years and Moody's expects the bank to report a marginal
improvement in profitability over the next 12-18 months. Moody's
says that profitability will be supported by (1) loan book growth
and improving net interest margin from a currently low level of
2% aided by an expected reduction in funding costs; and (2)
stable asset quality. During 2013, International Bank of
Azerbaijan's net profit increased to AZN59 million from AZN53
million in 2012, and translated into a moderate return on average
assets of 0.9%.

Support Considerations

International Bank of Azerbaijan's ratings benefit from Moody's
assessment of a high probability of systemic support, based on
the bank's 50.2% government ownership, large market shares and
systemic importance for Azerbaijan's economy. As a result,
International Bank of Azerbaijan's Ba3 deposit ratings benefit
from a three-notch uplift from its b3 BCA..

What Could Move The Ratings Up/Down

Considering the positive outlook, International Bank of
Azerbaijan's ratings will likely be upgraded from their current
levels in the next 12 to 18 months if the bank improves its
capital position and maintains adequate asset quality over the
outlook horizon. At the same time, the outlook could be changed
to stable if the bank fails to demonstrate a sustainable trend in
its financial performance.

Headquartered in Baku, Azerbaijan, International Bank of
Azerbaijan reported consolidated total assets of AZN7.7 billion,
total equity of AZN591 million and net profit of AZN59 million
under audited IFRS as at year-end 2013.


WAGNER & CO: Solar Firm Files For Insolvency
-------------------------------------------- reports that German solar company Wagner & Co.
Solartechnik GmbH has filed for insolvency amidst the continuing
crisis gripping the country's beleaguered PV sector.

The solar installation supplier has suffered continuing losses in
the face of Germany's shrinking market, the report relates.

"Unfortunately, the market for solar power and heating systems
has not as developed positively in recent months as we had
assumed in our restructuring plan," the company's management said
in a statement, relates. "Given sustained losses,
the continued financing of our operations could no longer be
ensured based on existing structures. As a result, on Tuesday, we
filed a petition to open insolvency proceedings in order to
continue restructuring with the possibilities offered by the
German insolvency law."

According to the report, Wagner's court-appointed insolvency
administrator, Jan Markus Plathner, added that conditions for
sustaining the continuation of operations were extremely
difficult. "But taking the product range and Wagner Solar's
proven performance in the past into account, there are good
arguments with which we can convince financiers and potential
investors. We will in any case do everything we can to maintain
as many jobs as possible. To do that, we especially need the
support of financing partners and customers," the report quotes
Mr. Plathner as saying. says the company notified its employees of the
move on April 23. As part of the insolvency proceedings, the
company has received special funding to insure the approximately
150 employees continue to receive their wages through June. By
then, Mr. Plathner hopes to know whether the company can be
saved, the report says.

Established in Marburg in 1979 and now based in nearby Coelbe,
Wagner has operated as a system provider of solar installations,
offering holistically sustainable solutions in the areas of solar
power, solar heating and pellet heating systems for homes and
buildings. The company is also active in France, Britain, Italy,
Spain and North America through subsidiaries and partnerships.
Wagner is likewise a leading solar thermal collector manufacturer
in Europe.


EUROBANK: EU Commission Approves State Rescue Plans
Deutsche Presse-Agentur reports that the European Commission
approved Greek state rescue plans for Eurobank on Tuesday, after
an in-depth probe of bridging loans provided by Athens to prop up
some of the country's largest lenders.

According to dpa, the rescue plan, which runs until 2018, would
enable Greece's fourth-largest bank to survive in the long term
without state aid, and would not distort competition, the
European Union's executive found.

Eurobank has benefited from capital injections of almost
EUR6 billion (US$8.3 billion) since 2012, after the state
subscribed to EUR950 million worth of shares in 2009, according
to the commission, dpa discloses.

The EU's executive also approved Eurobank's purchase of Nea
Proton Bank and new Hellenic Postbank -- new institutions set up
from the ashes of lenders bankrupted during Greece's financial
crisis -- as well as government aid granted to each of them, dpa

The commission began investigating Greece's government-funded
bank rescues in July 2012, after temporarily approving aid at the
time to Alpha Bank, Eurobank, Piraeus Bank and National Bank of
Greece, dpa recounts.

Eurobank Ergasias is the third largest bank in Greece with more
than 300 branches throughout the country and leading market
shares in high growth segments.  It was part of Spiro Latsis
group of companies.  Eurobank Ergasias is based in Athens,


CAPITAL MORTGAGE: S&P Puts B+ Rating on CreditWatch Negative
Standard & Poor's Ratings Services placed on CreditWatch negative
its 'B+ (sf)' credit rating on the class E notes in Capital
Mortgage S.r.l.'s BIPCA Cordusio RMBS.

The transaction has cumulative default triggers for the class B,
C, D, and E notes.  The trigger is set at 6.00% for the class E
notes.  On the March 2014 interest payment date (IPD), the
transaction's cumulative default ratio increased to 5.42% from
4.65% in March 2013.  S&P believes that the cumulative default
ratio is likely to exceed the trigger over the next 12 months.  A
breach of the trigger could result in the possibility of interest
due on the class E notes being deferred.  The transaction is
structured with a split waterfall for interest and principal, but
principal funds are available to pay the interest shortfalls --
including interest on the class E notes -- unless the trigger is
hit.  In that case, the issuer could use principal collections
only to pay senior expenses and interest on the class A1, A2, B,
C, and D notes, until the class D notes are repaid.  S&P has
therefore placed on CreditWatch negative its 'B+ (sf)' rating on
the class E notes.

S&P may downgrade the class E notes if its cash flow analysis
shows that interest available funds would be insufficient to
continue to pay timely interest on the class E notes.

Capital Mortgage's BIPCA Cordusio RMBS is a securitization of a
pool of prime performing mortgages secured on Italian residential
properties that Bipop-Carire SpA (now Unicredit SpA) originated.

FRANCO TOSI: Parties May Bid for Business Unit Until July 4
Dr. Andrea Lolli, in his capacity as Extraordinary Commissioner
of Franco Tosi Meccanica S.p.A., under Extraordinary
Administration, has been empowered by The Ministry of Economic
Development to set forth tender procedure for the conveyance of
the "Business Unit" of Franco Tosi Meccanica S.p.A. in accordance
with procedures, terms and conditions specified in the Tender
Notice and in the connected Procedural Guideline.

All interested parties are invited to submit binding offers
within and no later than 1:00 p.m. (Italian time) on July 4,
2014, by sending them to the office of Notary Dr. Angelo Busani
in Milan, Via Cordusio, 2.

All the participants may examine the full version of the
Invitation to Tender as well as the connected Procedural
Guideline, reporting procedures, terms and conditions for the
submission of the binding offers and the documents.  A complete
version of the Tender Notice, published also on "G.U.R.I." - the
Official Journal of the Italian Republic and on "G.U.C.E." - the
Official Journal of the European Union, may be consulted on the
website, reporting also the Procedural
Guideline.  Complete documentation may be extracted from the

For further information, communications may be forwarded to:

        Franco Tosi Meccanica S.p.A.
        Under Extraordinary Administration
        Piazza Monumento 12
        20025 Legnano (Milano)
        Fax: +39 0331 453594

Each determination to identify the purchaser of the Business Unit
of the Conveyer is conditioned and in each case subject to the
authorized power of Ministry of Economic Development according to
the law.


LIEPAJAS METALURGS: Unit Could Request Legal Protection Process
The Baltic Course, citing LETA, reports that Liepajas osta LM, a
subsidiary of Liepajas metalurgs, could request a legal
protection process to be started so the company could sort out
its financial problems, Liepajas metalurgs insolvency
administrator Haralds Velmers told the business portal.

This may be necessary if Liepajas osta LM has to pay into the
state budget a total of EUR28,375,874.90 -- the amount of value
added tax not yet paid by the company plus late payment
penalties, The Baltic Course relates.

In April 2013, the Administrative Regional Court ruled in
Liepajas osta LM favor in the company's dispute with the State
Revenue Service over an additional VAT amount that the Revenue
Service wanted the company to pay into the state budget. However,
this past February the Supreme Court ordered the Administrative
Regional Court to repeatedly review the case, the report recalls.
According to the Administrative Regional Court's schedule, the
case will now be heard on May 20, notes The Baltic Course.

When asked if the company's decision to request legal protection
process depends on the court's May 20 decision, Mr. Velmers said
that everything depended on the company's ability to honor its
short-term liabilities, according to The Baltic Course.

According to the report, the board and council of Liepajas osta
LM have discussed the matter of the legal protection process
regardless of the various legal disputes that the company is
involved in, as Liepajas osta LM currently has financial problems
and it is hard for the company to honor its short-term
liabilities. Therefore the company needs to reach agreement with
creditors on postponing the due payments. The legal protection
process would make it possible for the company to do this and to
bring order to the company's cash flows in the long term, the
report notes.

Liepajas osta LM is the largest stevedoring company in Liepaja.
The company's turnover decreased significantly last year, by
45 percent, after its parent company Liepajas metalurgs was ruled

Liepajas Metalurgs is a Latvian metallurgical company.

Liepaja Court commenced Liepajas metalurgs' insolvency process on
Nov. 12 last year.  Haralds Velmers was appointed insolvency
administrator.  Over 1,500 Liepajas metalurgs workers have been
laid off so far.  Liepajas metalurgs halted production last


EKSPORTFINANS ASA: Moody's Affirms Ba3 Issuer & Sr. Debt Ratings
Moody's Investors Service has affirmed Eksportfinans ASA's Ba3
issuer and senior debt ratings, B2(hyb) subordinated debt and
(P)B2 subordinate shelf program ratings. The rating outlook on
all long-term ratings was changed to stable from negative. The
issuer's Not-Prime short-term ratings were unaffected by the
rating action.

Ratings Rationale

This rating action follows the ruling in favor of Eksportfinans
by the Tokyo District Court on 28 March in the claim relating to
a purported declaration of default in respect of Eksportfinans's
Samurai bonds. The court ruled that no event of default has
occurred and dismissed the plaintiffs' claims. The plaintiffs did
not lodge an appeal in the Tokyo High Court of second instance
within the permitted two-week deadline.

The change in outlook of Eksportfinans's ratings to stable
reflects Moody's view that the immediate risk of acceleration of
debt repayment has diminished, following the Tokyo District Court
ruling. As a result, Moody's notes the decreased risk that more
of Eksportfinans's liabilities might become due prematurely, thus
reducing pressure on Eksportfinans's liquidity. The rating agency
continues to regard as essential a credible and timely approach
to managing run-off liquidity to ensure an orderly run-off
process for Eksportfinans.

Moody's notes positively Eksportfinans's favorable financial
position, including capitalisation (Tier 1 ratio 36.8% at year-
end 2013), a substantial liquidity reserve portfolio of NOK25.2
billion at year-end 2013 that consists of liquid securities and
cash equivalents, and a good quality loan book that is guaranteed
by government and/or highly rated banks.

Moody's acknowledges that certain of Eksportfinans's financial
metrics, such as capitalization, are likely to improve over time,
pending successful continuation of the run-off process. However,
Moody's assesses that the issuer's orderly run-off process
remains vulnerable to legal risks and the continued challenges of
its complex funding profile and elevated operational risks during
the run-off period. As a result, Moody's believes that the rating
will likely remain constrained at its current level, absent any
increases to external support.

What Could Move The Ratings Up/Down

Upward pressure on Eksportfinans's ratings could primarily arise
from increased support from its owners.

Downward pressure would be exerted on the ratings should the run
off process have any negative implications for Eksportfinans's
remaining operations, especially regarding its liquidity. Any
increased vulnerability to legal risks and triggers that could
escalate debt repayment would exert a downward pressure on
Eksportfinans's ratings.

Headquartered in Oslo, Norway, Eksportfinans reported total
assets of around NOK101 billion (US$16.6 billion) at year-end
2013, in accordance with IFRS.


CYFROWY POLSAT: S&P Affirms 'BB' CCR; Outlook Stable
Standard & Poor's Ratings Services said that it affirmed its 'BB'
long-term corporate credit rating on Polish media group Cyfrowy
Polsat S.A.  The outlook is stable.

At the same time, S&P assigned its 'BB' issue rating to Cyfrowy
Polsat's proposed Polish zloty (PLN) 2.5 billion term loan and
proposed PLN500 million senior secured revolving credit facility

The affirmation follows the meaningful progress that Cyfrowy
Polsat has made toward the completion of its acquisition of
Poland-based wireless telecommunications company Metelem Holding
Company Ltd.  S&P understands that all main conditions for the
acquisition -- in particular, the refinancing of Cyfrowy Polsat's
existing debt -- have been met, and S&P therefore anticipates
that the acquisition will close in the short term.

In S&P's view, the acquisition materially increases Cyfrowy
Polsat's diversity and scale by combining Poland's largest
direct-to-home pay-TV and mobile telecoms operators.  S&P is
therefore revising its assessment of Cyfrowy Polsat's business
risk profile upward to "satisfactory" from "fair."  Post the
acquisition, S&P forecasts that Cyfrowy Polsat will report
revenues of close to PLN10.0 billion and Standard & Poor's-
adjusted EBITDA of about PLN4.2 billion, of which roughly two-
thirds will come from Metelem's mobile operations marketed under
the Polkomtel brand.

Although the acquisition is an all-share deal, S&P anticipates
that higher leverage at Metelem will weaken Cyfrowy Polsat's
financial metrics.  Under S&P's base case, it forecasts an
adjusted debt-to-EBITDA ratio pro forma the acquisition of about
3.4x in 2014, and adjusted free operating cash flow (FOCF) to
debt of about 10%, which is commensurate with the lower end of
S&P's "significant" financial risk profile category.  S&P is
therefore revising its assessment of Cyfrowy Polsat's the
financial risk profile downward to "significant" from

Cyfrowy Polsat plans to issue a PLN2.5 billion term loan and
PLN500 million senior secured RCF, as well as use existing funds,
to refinance existing debt and the payment-in-kind notes at
Metelem.  While the amortizing nature of the proposed term loan
will reduce Cyfrowy Polsat's leverage, S&P sees a risk that
higher integration costs than it anticipates may delay
improvement in the group's ratios.  In addition, S&P views the
distribution restrictions in the Polkomtel's debt documentation
as negative, as it anticipates that they will prohibit Cyfrowy
Polsat from accessing Polkomtel's cash flows at least until 2016.
As a result, S&P currently applies a one-notch downward
adjustment to Cyfrowy Polsat's anchor of 'bb+' to account for its
comparable rating analysis, whereby S&P reviews an issuer's
credit characteristics in aggregate.

S&P's base-case scenario for Cyfrowy Polsat assumes:

   -- GDP growth in Poland of 2% in 2014;

   -- About PLN3 billion revenues from Cyfrowy Polsat's retail
      and TV broadcasting segments.

   -- A revenue decline of 2%-4% for Polkomtel in 2014 and about
      1% revenue growth in 2015.

   -- Cost synergies increasing Cyfrowy Polsat's adjusted EBITDA
      margin by 100 basis points to about 43% in 2014 and 44% in

Based on these assumptions, S&P arrives at the following credit

   -- Adjusted FOCF to debt of about 10% in 2014, down from about
      27% in 2013, and improving to 14%-15% in 2015.

   -- An adjusted debt-to-EBITDA ratio of about 3.4x in 2014, up
      from about 1.6x in 2013, and improving to 2.9x in 2015.

The stable outlook reflects S&P's view that Cyfrowy Polsat will
successfully integrate Metelem, thereby improving its credit
metrics over the next 12 months to a level comfortably in line
with a "significant" financial risk profile.  The outlook also
reflects S&P's view that Cyfrowy Polsat will not have access to
Polkomtel's cash flows until Polkomtel's debt has been refinanced
or Polkomtel deleverages meaningfully, neither of which S&P
anticipates over the next 12 months.

Upside scenario

S&P could raise the rating if Cyfrowy Polsat achieves adjusted
debt to EBITDA of less than 3x and adjusted FOCF to debt of at
least 15%, both on a sustainable basis.  If the refinancing of
Polkomtel's debt results in full access to Polkomtel's cash
flows, it could also lead to an upgrade.

Downside scenario

S&P sees limited risk of a downgrade as it anticipates that
Cyfrowy Polsat will start to deleverage over the short term
through a combination of debt reduction and transaction
synergies. S&P could, however, lower the rating if difficulties
in integrating Polkomtel or weaker operating performance than S&P
expects reversed Cyfrowy Polsat's deleveraging such that adjusted
FOCF to debt dropped below 10% on a sustainable basis, or
adjusted debt to EBITDA increased to more than 4x.

METELEM HOLDING: S&P Raises CCR to 'BB'; Outlook Stable
Standard & Poor's Ratings Services said that it raised its long-
term corporate credit rating on Poland-based wireless
telecommunications company Metelem Holdings Company Ltd. to 'BB'
from 'BB-'.  The outlook is stable.

At the same time, S&P raised its issue rating on Metelem's
unsecured and payment-in-kind (PIK) notes to 'B+' from 'B'.

The upgrades follow the meaningful progress that Polish media
group Cyfrowy Polsat S.A. has made toward the completion of its
acquisition of Metelem.  S&P understands that all main conditions
for the acquisition have been met and S&P therefore anticipates
that it will close in the short term.

The upgrade reflects S&P's assessment of Metelem as a "core"
subsidiary to its future parent, Cyfrowy Polsat.  As per S&P's
criteria, it equalizes the corporate credit rating on a "core"
subsidiary with the group credit profile on the parent.  S&P
assess Cyfrowy Polsat's group credit profile at 'bb', in line
with its corporate credit rating.

S&P is also revising Metelem's stand-alone credit profile upward
to 'bb' from 'bb-' to reflect its forecast that Metelem's
leverage will fall below 4x in the short term, supported by a
meaningful reduction in its Standard & Poor's-adjusted debt.

S&P believes that Cyfrowy Polsat is highly unlikely to sell
Metelem as the latter is an important part of Cyfrowy Polsat's
long-term strategy to become a leading Polish telecoms and media
group.  Furthermore, S&P anticipates meaningful operational
integration between both entities, and Metelem generates the
majority of the consolidated group's revenues and cash flows.  In
addition, S&P's view that Cyfrowy Polsat is highly unlikely to
sell Metelem incorporates its understanding that Cyfrowy Polsat's
majority owner, Mr. Solorz-Zak, considers Metelem's wholly owned
subsidiary Polkomtel as a key asset in his investment portfolio.

S&P therefore believes that Cyfrowy Polsat will provide financial
support to Metelem in all likely scenarios.  S&P's view is
further supported by the expected refinancing of Metelem's
callable PIK notes.

S&P assess Metelem's business risk profile as "satisfactory,"
reflecting Polkomtel's solid position as one of the three
dominant Polish wireless carriers, and the leader in the contract
mobile segment.  Polkomtel's above-average operating
efficiency -- evident from its maintenance of adjusted EBITDA
margins of more than 40% and a track record of successfully
implementing efficiency measures -- is a further meaningful
support to S&P's assessment of business risk.  Although S&P
considers the Polish wireless market to be highly competitive and
price-sensitive, S&P thinks it benefits from relatively solid
monetization prospects from mobile data in view of the poor fixed
broadband coverage in rural areas. We believe that mobile data
revenues will likely gradually start to offset a continuing
decline in traditional voice revenues.

S&P's assessment of Metelem's business risk profile incorporates
its view of the telecoms and cable industry's "intermediate" risk
and our view of Poland's "moderately high" country risk.

S&P assess Metelem's financial risk profile as "aggressive,"
primarily reflecting its meaningful debt burden and high interest
on its unsecured debt.  S&P forecasts relatively depressed EBITDA
interest coverage of around 3x in 2014, and weakening cash flows
over the medium term, due to higher working capital outflows.

"Our assessment of Metelem's financial risk profile benefits,
however, from significant deleveraging potential to well below
4x, thanks to relatively meaningful cash accumulation, and the
refinancing of Metelem's PIK notes at Cyfrowy Polsat.  Our
adjusted debt figure includes an adjustment for about Polish
zloty (PLN) 1 billion of cash that we consider to be surplus.
Despite some exposure to debt denominated in foreign currencies
(about 35% of total debt), Metelem hedges the cash flows of its
near-term coupon payments, and we expect potential volatility in
credit metrics to be more than offset by nominal debt reduction,"
S&P said.

S&P's base-case operating scenario for Metelem assumes:

   -- GDP growth in Poland of 2.0% in 2014.

   -- A 2%-4% revenue decline in 2014, reflecting the remaining
      impact of cuts to the mobile termination rate from July
      2013, and additional pressure on average revenue per user
      (ARPU) due to the continued downward re-pricing of
      subscribers to unlimited calls and text offers.

   -- Low single-digit revenue growth of about 1% in 2015.  S&P
      assumes that ARPU will begin to stabilize as the growth in
      data revenues offsets a moderate decline in voice revenues.

   -- A slight decline in the reported EBITDA margin to about
      41%-42% in 2014-2015, due to continued ARPU pressures and
      limited cost-cutting measures.

   -- Growth in working capital requirements due to higher
      handset sales through installments.

   -- Capital expenditure (capex) of 12%-13% of revenues in 2014-
      2015, excluding the amortization of Metelem's Universal
      Mobile Telecommunications System (UMTS) license liability
      and its acquisition of spectrum licenses.

   -- Additional capex of about PLN800 million for spectrum
      renewals and acquisitions.  S&P realizes, however, that
      actual spending may differ significantly, depending on the
      outcome of the upcoming 800MHz/2600MHz spectrum auction.

Based on these assumptions, S&P arrives at the following credit

   -- Funds from operations (FFO) to debt of about 17% in 2014
      and 20% in 2015, up from about 12.5% at year-end 2013;

   -- A decline in debt to EBITDA to about 3.9x in 2014 and 3.6x
      in 2015, from 4.0x in 2013;

   -- Free operating cash flow (FOCF) to debt of about 2%-3% in
      2014, increasing to about 10% in 2015; and

   -- Adjusted EBITDA interest coverage of about 3x in 2014.

The stable outlook on Metelem reflects that on Cyfrowy Polsat, in
view of Metelem's "core" status in the Cyfrowy Polsat group.  As
per S&P's criteria, it equalizes the corporate credit rating on a
"core" subsidiary with the group credit profile on the parent.

Upside scenario

S&P would upgrade Metelem by one notch if it upgraded Cyfrowy
Polsat to 'BB+', assuming that Metelem's "core" status in the
Cyfrowy Polsat group is unchanged.

S&P do not see any upside to Metelem's SACP in the short term, as
it anticipates that free cash flow generation will remain below
10% and interest coverage will be only slightly higher than 3x.
S&P sees potential upside to the SACP if Cyfrowy Polsat continues
to refinance Metelem's debt at its level, or if Metelem's EBITDA
increases meaningfully beyond S&P's base-case forecasts.  In
particular, S&P could revise the SACP on Metelem upward if it
forecasts leverage below 3.5x and FOCF to debt above 10% on a
sustainable basis.

Downside scenario

S&P sees limited risk of a downgrade in the short term.  The
rating on Metelem would likely come under pressure if the 'BB'
rating on Cyfrowy Polsat came under pressure.

S&P sees limited downside to Metelem's SACP as it believes that
any potential operating pressures or foreign-exchange-rate
volatility would be more than offset by further debt reduction.
However, S&P could revise Metelem's SACP downward if it forecasts
debt to EBITDA above 4.5x and FOCF to debt below 5% on a
sustainable basis.


VINARTE: Creditors Approve Assets Sale to Red Gate
Gabriela Stan at Ziarul Financial reports that RVA Insolvency,
Vinarte's judicial liquidator, said creditors of the insolvent
company approved Friday the sale of the assets, wine stocks and
brands to China-based Red Gate, for EUR3.6 million.

As reported by the Troubled Company Reporter-Europe on April 30,
2014, Romania Insider, citing RVA, disclosed that the asset
package for sale consists of about 94 hectares of vineyard,
buildings and equipment for wine production valued at EUR1.08
million, wine inventories valued at EUR1.66 million and the wine
brands of the winery, which are valued at EUR182,000 to
EUR769,000, Romania Insider.  The main wine brands are Villa
Zorilor and Prince Matei, Romania Insider noted.

Vinarte is a Romanian wine producer.


TENEX-SERVICE: S&P Lowers ICRs to 'BB+/B'; Outlook Negative
Standard & Poor's Ratings Services lowered its long- and short-
term issuer credit ratings on Russian nuclear sector leasing
company TENEX-Service (TENEX) to 'BB+/B' from 'BBB-/A-3'.  The
outlook is negative.

At the same time, S&P lowered the Russia national scale rating on
TENEX to 'ruAA+' from 'ruAAA'.

The downgrade of TENEX follows a downgrade of its parent, state-
owned Atomic Energy Power Corp. JSC (AtomEnergoProm; BBB-
/Negative/A-3; Russia national scale 'ruAAA'), for which TENEX
acts as quasi-captive in the leasing segment.  Given S&P's
assessment that TENEX is a "highly strategic" subsidiary of
AtomEnergoProm under its criteria, S&P caps its ratings at one
notch below those on the parent.  S&P views TENEX as a fully-
integrated and dependent subsidiary of AtomEnergoProm, and S&P
thinks that the likelihood of extraordinary support from its
parent, if required, is extremely high.  Although small compared
with the whole group, TENEX has a very high level of integration
with its parent, operating under a captive-like business model.
TENEX's strategy, risk management, funding, and client base are
shared with or provided by the group, and it has limited business
scope outside the group.

S&P also views TENEX as a government-related entity (GRE), and
its assessment of its "limited" link to the government is based
on the sovereign's indirect ownership of the company via
AtomEnergoProm. TENEX does not play a central role in meeting the
Russian government's key economic and social objectives, so S&P
considers that it has "limited" importance for the government.

Because AtomEnergoProm is a state-owned entity, S&P thinks that
any government support would likely be extended to TENEX through
the parent company.

The negative outlook on TENEX mirrors that on AtomEnergoProm.  If
S&P downgraded the parent, it would also lower its ratings on

S&P could also lower the ratings on TENEX if AtomEnergoProm no
longer viewed TENEX's leasing model as superior to direct
purchases, which would signal a decrease of TENEX's importance to
and integration with the group.  S&P would also take a negative
rating action if TENEX's strategy were substantially extended
beyond serving AtomEnergoProm's group of companies, which, in
S&P's opinion, would mean less integration with the parent and a
weakening of TENEX's stand-alone credit profile.

A revision of the outlook on TENEX to stable would depend on the
same outlook revision on the parent.


CODERE SA: Gets More Time to Negotiate EUR1.1-Bil. Debt Deal
Katie Linsell and Julie Miecamp at Bloomberg News report that
Codere SA gained more time to negotiate a EUR1.1 billion (US$1.5
billion) debt restructuring deal and avoid seeking full creditor

According to Bloomberg, Codere said in a statement that the
company's lenders and a majority of bondholders agreed to
continue talks for 10 days.  It had until Wednesday, April 30, to
reach an agreement or start insolvency proceedings after seeking
preliminary creditor protection on Jan. 2, Bloomberg notes.

"The company expects to continue the productive discussions with
all creditors during the standstill period in order to achieve a
consensual restructuring of Codere's debt," Bloomberg quotes the
statement as saying.

Creditors also agreed not to demand repayment during this period,
Bloomberg discloses.

Codere SA is a Madrid-based gaming company.  It operates betting
shops and race tracks from Italy to Argentina.

Codere sought preliminary creditor protection on Jan. 2, giving
the company four months to agree a restructuring plan or start
insolvency proceedings.

PESCANOVA SA: Reaches Debt Accord With Creditors
Reuters reports that Pescanova SA said on April 28 it had reached
an agreement with its creditors on a restructuring plan that it
hopes will help it avoid liquidation.

Pescanova's main shareholders, Barcelona-based brewer Damm and
investment firm Luxempart, will cede their control of the company
to the banks, which would salvage some EUR1 billion ($1.4
billion) of the company's debt under the plan, the news agency

Lenders include top Spanish banks such as Sabadell, Popular,
Caixabank and BBVA, Reuters notes.

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


UKRAINE: IMF Approves US$17-Bil. Rescue Deal
The Telegraph reports that the International Monetary Fund has
approved a US$17 billion aid deal for Ukraine, even as Kiev
fights to prevent pro-Moscow separatists from hiving off another
chunk of the country.

According to The Telegraph, the IMF executive board's green light
opens the way for an immediate deployment of US$3.2 billion to
Kiev, which faces deep fiscal problems, compounding its political

Part of a US$27 billion bailout including the World Bank,
European Union and others, the IMF, as cited by The Telegraph,
said the rescue plan "aims to restore macroeconomic stability,
strengthen economic governance and transparency, and launch sound
and sustainable economic growth, while protecting the most

The Fund has warned though that the Ukraine economy faces a 5%
contraction this year, even with the two-year loan program, The
Telegraph notes.

Some of the initial disbursements could be turned around to pay
off an outstanding US$2.2 billion bill for natural gas from
Russia, which has threatened to cut off fuel supplies to its
former Soviet republic, The Telegraph says.

In addition, the country already owes the IMF under previous loan
programs and the Fund's new loan could be tapped to repay off
that, The Telegraph discloses.

U N I T E D   K I N G D O M

BARCLAYS PLC: To Announce Creation of Bad Bank Next Week
Martin Arnold, Patrick Jenkins and Daniel Schafer at The
Financial Times report that Barclays will next week announce the
creation of a bad bank in a bid to transform its struggling
investment banking operations, which were dealt a further blow on
Tuesday with the departure of the highly regarded head of its US

According to the FT, people familiar with the plan said that the
move to exit parts of its shrinking fixed-income business and its
lossmaking European branch network will be announced as part of
next week's strategic update to investors.  The internal bad bank
will be run by Eric Bommensath, co-head of its investment bank,
the FT discloses.

The news comes as fears intensify that the departure of Skip
McGee as head of Barclays Americas will trigger an exodus of
bankers acquired when the UK bank took over Lehman Brothers' US
operations during the financial crisis, the FT notes.

Barclays has been under pressure from investors to cut costs and
rein in pay levels while coming up with a more coherent strategy
for its investment bank, which is failing to generate returns
above its cost of capital, the FT says.

Barclays PLC -- is a global
financial services provider engaged in retail banking, credit
cards, wholesale banking, investment banking, wealth management
and investment management services.

CO-OPERATIVE BANK: Britannia Merger "Exacerbated" Problems
Harry Wilson at The Telegraph reports that the Co-operative Bank
should never have taken over the Britannia Building Society as
the merger, far from creating a "super mutual" just "exacerbated"
problems at both lenders.

The Telegraph relates that former Treasury official Sir
Christopher Kelly, who was commissioned by the Co-op Group to
look at the circumstances leading up to the discovery last year
of a GBP1.5 billion black hole in the balance sheet of its
banking arm, said the Britannia deal "should probably never have

Mr. Kelly, as cited by The Telegraph, said failings in the
governance and management of the Co-op Group and the Co-op Bank
were largely to blame for the situation and that insufficient
consideration was given to the risks taken by the lender.

In a series of damning findings, Mr. Kelly dismissed claims by
the Co-op Bank and Britannia's former chief executive Neville
Richardson that the problems in the banks' loan books only
resulted from the inattention of his successors, saying the Co-op
should never have got itself in the position where it was
managing such a large pool of assets, according to The Telegraph.

As well as the capital and loan issues, Mr. Kelly pointed to the
major IT problems caused by the takeover given that the Co-op
Bank had already been in the process of moving to a new core
banking system at the time of the deal, The Telegraph relates.
Mr. Kelly blamed many of the bank's subsequent IT problems that
ultimately saw it write off more than GBP200 million in spending
on inexperienced staff attempting to do a job beyond their
capabilities, The Telegraph relays.

The Co-op Bank problems led to the Co-op Group ceding control of
the business last December, handing over a 70% stake in the bank
to its bondholders after a debt-for-equity swap that was required
to prevent the lender's probable closure, The Telegraph recounts.

Co-op Bank -- part of the mutually owned food-to-funerals
conglomerate Co-operative Group -- traces its history back to
1872.  The bank gained prominence for specializing in ethical
investment.  It refuses to lend to companies that test their
products on animals, and its headquarters in Manchester is
powered by rapeseed oil grown on Co-operative Group farms.

Founded in 1863, the Co-op Group has more than six million
members, employs more than 100,000 people, and has turnover of
more than GBP13 billion.

                           *     *     *

The Troubled Company Reporter-Europe on Nov. 14 and 18, 2013 has
reported that Moody's Investors Service has affirmed The
Co-operative Bank's Caa1 senior unsecured debt and deposit
ratings, and changed the outlook on the rating to negative from
developing, and Fitch Ratings has downgraded the company's Issuer
Default Rating to 'B' from 'BB-' and placed it on Rating Watch

KPL CONTRACTS: Some of Assets Stolen, Administrators Say
John Campbell at BBC News reports that the administrators of KPL
Contracts have made a complaint to the police, alleging some of
the firm's assets have been stolen.

KPL Contracts went into administration in February with the loss
of 200 jobs, BBC recounts.

According to BBC, administrators PricewaterhouseCoopers said
some of the Dungiven firm's machinery went missing after they
were appointed.

Although a "significant" number of assets were recovered, it said
the "remaining unrecoverable assets" had been reported as stolen,
BBC notes.

It is understood those assets are more than a dozen diggers, BBC

PwC's report also says the administrators faced "significant
difficulties" in getting control of KPL's fleet of vehicles, BBC

It describes how the vehicles were held at a yard owned by a
related party of KPL and were only released after "protracted
negotiations", BBC relates.

The report also details the events which led to the failure of
the firm, BBC states.

According to BBC, the report reveals that KPL was finished off by
an unsuccessful expansion in Scotland where it had begun working
as a sub-contractor for Carillion.

That led to a drop in expected revenues which then placed the
firm under acute cashflow pressure, BBC notes.

The administrator's report shows while Ulster Bank was owed
GBP9.5 million at the time of the firm's failure, it will likely
recover less than GBP4 million, BBC discloses.

Unsecured creditors, which include a large number of small
businesses, are owed a total of GBP5 million, but are unlikely to
get anything, BBC says.

KPL Contracts is a County Londonderry construction firm.

* London's New Bitcoin Exchange Hopes to Avoid Mt. Gox Fate
Lisa Fleisher, writing for The Wall Street Journal, reported that
a new London-based bitcoin exchange wants to prove it won't be
the next Mt. Gox -- the now-bankrupt exchange of the online
currency -- by challenging customers to find any whiff of a
problem in its books.

According to the report, the U.K. exchange, called Coinfloor, is
one of the first to try to prove it is solvent by publishing a
list of accounts and balances . . . encoded in a way that account
holders can identify their own accounts.

"We are letting the entire world audit our books, essentially,"
said Mark Lamb, Coinfloor's chief executive, the report related.
"After the bankruptcy of Mt. Gox, we're trying to make a stand
for accountability."

It is the latest example of a bitcoin business trying to calm
nerves over the safety and reliability of the virtual currency,
the report further related.  The five-year-old currency suffered
a major blow in February when Japan-based exchange Mt. Gox shut
down and appeared to have lost track of a half billion dollars'
worth of bitcoin.

Bitcoin enthusiasts say that if there were a way for customers to
check in on their accounts, the problems at Mt. Gox could have
been caught sooner, the report added.  Coinfloor is one of a few
exchanges trying out this new method, known as "proof of
solvency." A few days after Coinfloor published its balances,
Ontario-based Vault of Satoshi did something similar.


* BOOK REVIEW: A Legal History of Money in the United States
Author: James Willard Hurst
Publisher: Beard Books
Paperback: US$34.95
Review by Gail Owens Hoelscher
Order your personal copy today and one for a colleague at

This book chronicles the legal elements of the history of the
151system of money in the United States from 1774 to 1970. It
originated as a series of lectures given by James Hurst at the
University of Nebraska in 1973. Mr. Hurst is quick to say that
he , as a historian of the law, took care in this book not to
make his own judgments on matters outside the law. Rather, he
conducted an exhaustive literature review of economics, economic
history, and banking to recount the development of law over the
operations of money. He attempted to "borrow the opinions of
qualified specialists outside the law in order to provide a
meaningful context in which to appraise what the law has done or
failed to do."

Mr. Hurst define money, for the purposes of this books, as "a
distinct institutional instrument employed primarily in
allocating scarce economic resources, mainly through government
and market processes," and not shorthand for economic, social,
or political power held through command of economic assets."
From the beginning, public and legal policy in the U.S. centered
on the definition of legitimate uses of both law affecting
money, and allocation of power over money among official
agencies, both federal and state. The foundations of monetary
policy were laid between 1774 and 1788. Initially, individual
state legislatures and the Continental Congress issued paper
currency in the form of bills of credit. The Constitutional
Convention later determined that ultimate control of the money
supply should be at the federal level. Other issues were not
clearly defined and were left to be determined by events.

The author describes how law was used to create and maintain a
system of money capable of servicing the flow of resource
allocations in an economy of broadly dispersed public and
private decision making. Law defined standard money units and
made those units acceptable for use in conducting transactions.
Over time, adjustment of the money supply was recognized as a
legitimate concern of law. Private banks were delegated
expansive monetary action powers throughout the 1900s and
private markets for gold and silver were allowed to affect the
money supply until 1933-34. Although the Federal Reserve Act
was not aimed clearly at managing money for goals of major
economic adjustment, it set precedents by devaluing the dollar
and restricting the use of gold.

Mr. Hurst devotes a large part of his book to key issues of
monetary policy involving the distribution of power over money
between the nation and the states, between legal and market
processes, and among major agencies of the government. Until
about 1860, all major branches of government shared in making
monetary policy, with states playing a large role. Between 1908
and 1970, monetary policy became firmly centralized at the
national level, and separation or powers questions arose between
the Federal Reserve Board, the White House (The Council of
Economic Advisors), and the Treasury.

The book was an enormous undertaking and its research
exhaustive. It includes 18 pages of sources cited and 90 pages
of footnotes. Each era of American legal history is treated
comprehensively. The book makes fascinating reading for those
152interested in the cause and effect relationship between legal
processes and economic processes and t hose concerned with
public administration and the separation of powers.
James Willard Hurst (1910-1997) is widely regarded as the
grandfather of American legal history. He graduated from
Harvard Law School in 1935 and taught at the University of
Wisconsin-Madison for 44 years.


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

                 * * * End of Transmission * * *