---

        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, March 20, 2015, Vol. 16, No. 56

                            Headlines


A N D O R R A

BANCA PRIVADA: Fitch Lowers IDRs to 'Restricted Default'


B E L G I U M

SOBELMAR ANTWERP: Commences Chapter 11 Reorganization


B U L G A R I A

BULGARIAN ENERGY: Fitch Lowers Issuer Default Ratings to 'BB'
CORPORATE COMM'L: Parliament Amends Bank Insolvency Bill


F R A N C E

SOCIETE GENERALE: S&P Lowers Rating on 2014-104 Notes to 'BBp'


G R E E C E

GREECE: Talks with International Creditors Make Little Progress


I T A L Y

PIAGGIO & C: Moody's Says Performance Could Improve in 2015


L U X E M B O U R G

AURIS LUXEMBOURG II: S&P Assigns 'B+' CCR; Outlook Stable


N E T H E R L A N D S

CLONDALKIN INDUSTRIES: S&P Affirms 'B' Corporate Credit Rating
DPX HOLDINGS: S&P Retains 'B' CCR Following EUR150MM Loan Add-On
GROSVENOR PLACE III: Moody's Affirms Ba3 Rating on Cl. E Notes


R U S S I A

MOBILE TELESYSTEMS: Fitch Affirms BB+ IDR; Outlook Stable
MTS BANK: Fitch Affirms 'B+' IDR; Outlook Stable
SISTEMA JSFC: Fitch Affirms 'BB-' IDR; Outlook Stable


S P A I N

AUTOVIA DE LA MANCHA: Moody's Lifts Rating on EUR110MM Loan to B1
AUTOVIA DE LOS VINEDOS: Moody's Affirms Caa1 Rating on EIB Loan
BANCO DE MADRID: May Face Liquidation After Bail-out Ruled Out
TP FERRO: Fails to Reach Refinancing Agreement with Creditors


T U R K E Y

ARCELIK AS: Fitch Affirms 'BB+' Issuer Default Rating


U N I T E D   K I N G D O M

CITY LINK: Former Employees Could Recover 'Thousands'
KARDEN PIPEWORK: In Administration, Ceases Trading
LABUTE: Calls In Administration, Ceases Trading
MUIRFIELD CONTRACTS: Contractors Offer Lifeline to Former Staff
SCOTLAND: Fans Can Buy Football Clubs to be Considered

TYNEMOUTH PUB: Assets Acquired After Administration
UROPA SECURITIES 2008-1: S&P Affirms 'BB-' Rating on Cl. C Notes


X X X X X X X X

* BOOK REVIEW: Oil Business in Latin America: The Early Years


                            *********


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A N D O R R A
=============


BANCA PRIVADA: Fitch Lowers IDRs to 'Restricted Default'
--------------------------------------------------------
Fitch Ratings has downgraded Banca Privada d'Andorra's (BPA)
Long- and Short-term Issuer Default Ratings (IDRs) to 'Restricted
Default' (RD) from 'B+' and 'B', respectively, and its Viability
Rating (VR) to 'f' from 'b+', following the adoption of temporary
precautionary measures that include limits on withdrawals.  The
ratings were removed from Rating Watch Negative (RWN).

On March 10, 2015, the U.S. Department of the Treasury's
Financial Crimes Enforcement Network (FinCEN) named BPA as a
foreign financial institution of primary money laundering
concern.  Its proposed rulemaking triggered, among other factors,
the intervention of the entity by the Institut Nacional Andorra
de Finances, the Andorran financial system authority, and of its
subsidiaries in Spain by the Bank of Spain and in Panama by the
Superintendency of Banks, caused the board of directors and
several senior managers to resign and led to the application of
insolvency proceedings of the bank's Spanish subsidiary.

On March 16, BPA's provisional administrators agreed to limit
account movements to EUR2,500 per week and per account.  This
decision was taken in response to BPA's difficulties in its basic
functioning after FinCEN's allegations.

KEY RATING DRIVERS -- IDRs and VR

Fitch acknowledges that the temporary measures were taken to
safeguard the stability of the institution, preserve the
interests of clients and to ultimately protect BPA's solvency and
liquidity. However, the further downgrade of BPA's IDRs and VR
reflects Fitch's view that the temporary restrictions on account
movements represent a default on a material category of BPA's
third-party, private sector senior debt that is commensurate with
IDRs at 'RD' and a VR at 'f'.  Deposits accounted for 45% of
BPA's balance-sheet at end-2013.

According to Fitch's rating definitions, 'RD' ratings indicate an
issuer, as is the case for BPA, that has experienced an uncured
payment default of a bond, loan or other material obligation but
has not entered into bankruptcy filings, administration,
receivership, liquidation or other formal winding-up procedures,
and which has not otherwise ceased operating.

BPA's 'f' VR reflects Fitch's opinion that BPA has failed as it
has defaulted on its senior obligations to third-party, non-
government creditors.

In the absence of the temporary measures that have been adopted,
Fitch believes that BPA's liquidity would have come under further
pressure.  Its solvency is also likely to be impacted, for
example by the insolvency proceedings that have been filed by its
Spanish subsidiary, Banco Madrid.  BPA's stake in Banco Madrid
represents a sizeable portion of its equity.

RATING SENSITIVITIES -- IDRs AND VR

Fitch will review the IDRs and VR of BPA once there is more
clarity on the future of the bank.  The IDR will be assigned 'D'
in the event of the liquidation, winding-up or cessation of the
business, which Fitch views as a potential scenario.  The VR may
be re-rated if and when Fitch believes that the bank has regained
viability.

KEY RATING DRIVERS -- SUPPORT RATING AND SUPPORT RATING FLOOR

The bank's Support Rating (SR) of '5' and Support Rating Floor
(SRF) of 'No Floor' reflect Fitch's view that the probability of
BPA receiving support in case of need is low.

Although Fitch does not publish a rating for Andorra, the banking
system's large size relative to the Andorran economy means that
while the authorities' propensity to provide support may be high,
it cannot be relied upon given limited resources at their
disposal.

RATING SENSITIVITIES -- SUPPORT RATING AND SUPPORT RATING FLOOR

The SR and SRF are sensitive to changes in assumptions around the
propensity or ability of Andorran authorities to provide timely
support to BPA.  This might arise if there is a significant
increase in resources available at authorities' disposal or if
there is a change in ownership.

Fitch has taken these rating actions on BPA:

  Long-term IDR: downgraded to 'RD' from 'B+'; removed from
  Rating Watch Negative

  Short-term IDR: downgraded to 'RD' from 'B'

  VR: downgraded to 'f' from 'b+'; removed from Rating Watch
  Negative

  Support Rating: affirmed at '5'

  Support Rating Floor: affirmed at 'No Floor'



=============
B E L G I U M
=============


SOBELMAR ANTWERP: Commences Chapter 11 Reorganization
-----------------------------------------------------
Sobelmar Antwerp N.V. on March 17 disclosed that Sobelmar and
certain of its subsidiaries have commenced Chapter 11
reorganization proceedings in the U.S. Bankruptcy Court for the
District of Connecticut (Hartford).  The Company believes that
the Chapter 11 process will facilitate restructuring, which is
designed to restore the Company to long-term financial health.

According to a spokesperson for Sobelmar, "Even though Sobelmar
remained current on its debt service until its vessel Lender
recently imposed a very high penalty rate, it has become
increasingly clear that, in light of the unwillingness of the
Lender to work with Sobelmar on an out-of-court restructuring,
Sobelmar needs the protection of Chapter 11 to ensure the
uninterrupted operation of our vessels and services to our
customers.  While we are disappointed in the Lender's
intransigence, we want to assure our customers and suppliers that
Sobelmar will continue to operate in the ordinary course of
business during our Chapter 11 proceedings and that we intend to
emerge from Chapter 11 on a financially sound footing."

The Chapter 11 filings include the following companies and
vessels: SBM-1 Inc. (Marshall Islands) owning M/V "Brasschaat",
SBM-2 Inc. (Marshall Islands) owning M/V "Vyritsa", SBM-3 Inc.
(Marshall Islands) owning M/V "Kovdor", SBM-4 Inc. (Marshall
Islands) owning M/V "Zarachensk", and two Belgian holding
companies, Sobelmar Antwerp N.V. and Sobelmar Shipping N.V.

Sobelmar's principal legal advisor for the restructuring process
and Chapter 11 proceedings is Bracewell & Giuliani LLP, with the
Hamburg-based Falkenberg Law Office continuing to provide normal
course corporate and maritime legal services.  Sobelmar's
financial advisor is Odinbrook Global Advisors LLC.  For further
information, please contact Evan Flaschen at Bracewell &
Giuliani, +1.860.256.8537, evan.flaschen@bgllp.com



===============
B U L G A R I A
===============


BULGARIAN ENERGY: Fitch Lowers Issuer Default Ratings to 'BB'
-------------------------------------------------------------
Fitch Ratings has downgraded Bulgarian Energy Holding EAD's (BEH)
Long-term foreign and local currency Issuer Default Ratings (IDR)
and its foreign currency senior unsecured rating to 'BB' from
'BB+', and placed the ratings on Rating Watch Negative (RWN).

The rating downgrade reflects a substantial deterioration of BEH
group's credit metrics driven by a wider tariff deficit at its
subsidiary Natsionalna Elektricheska Kompania EAD (NEK) amid an
unfavourable regulatory and market environment.

The RWN reflects the risk of a further rating downgrade if NEK's
and BEH group's financial results fail to materially improve in
2015-2016 from weak 2014 preliminary levels.  The speed and scale
of results improvement depends on the implementation of planned
regulatory and legislative changes as well as on NEK's long-term
power purchase agreements renegotiation.  Fitch expects a
deterioration of the BEH group's liquidity in 2015 due to working
capital outflow projected by Fitch, which together with capex
will result in negative free cash flow (FCF).  Based on
preliminary numbers for 2014, BEH expects to meet a debt
incurrence covenant, as defined in the EUR500 million eurobond
documentation, albeit with limited headroom.  In Fitch's view,
failure to meet the eurobond covenant resulting in limitation to
raise debt would substantially worsen BEH group's liquidity
position.

Fitch expects to resolve the RWN in the next few months once the
2014 audited consolidated financial statements are available and
depending on the progress on various efforts aimed at narrowing
NEK's deficit.  The efforts include planned regulatory and
legislative changes, for instance, related to a reduction of
NEK's obligation to purchase electricity from renewable energy
sources and cogeneration plants and also renegotiation of long-
term contracts with two thermal power plants, AES-3C Maritsa East
1 EOOD and Contour Global Maritsa East 3 AD.

BEH's ratings are notched up one level from its standalone rating
of 'BB-'/RWN, reflecting the BEH group's strong links with the
Bulgarian state (BBB-/Stable).  Fitch expects that the state will
support BEH to avoid potential liquidity issues in case of a
covenant breach.

KEY RATING DRIVERS

Deteriorated Financial Position of NEK

NEK, which acts as a public supplier of electricity in Bulgaria,
reported heavy losses on its core activity in 2014 due to an
unfavorable regulatory and market environment.  Inability to
fully recover the costs of purchased electricity from various
generation sources, including renewable energy sources,
cogeneration plants and thermal power plants with long-term power
purchase agreements, given the insufficient level of NEK's
regulated sale prices resulted in a preliminary EBITDA loss of
BGN0.5bn at NEK in 2014 compared with close to break-even EBITDA
in 2013.  This in turn had a material negative impact on BEH's
consolidated profitability and credit metrics.  The widened
tariff deficit of NEK has created liquidity issues for the
company and an increase of overdue trade payables to its
suppliers.  BEH continues to support NEK through inter-company
loans of BGN1.2 billion.

Fitch views the Bulgarian regulatory environment as less
developed and far less predictable than in western Europe.
Several legislative and regulatory changes aimed at narrowing
NEK's deficit are planned by the government, parliament and the
regulatory office for 2015, but may be subject to delays or may
yield lower-than-expected positive impact as happened in 2014
with some planned changes.

BEH's Weak Credit Ratios

Based on selected preliminary numbers for 2014 Fitch estimates
BEH group's EBITDA to have dropped to BGN0.3 billion in 2014 from
BGN0.6 billion in 2013 primarily due to the losses at NEK.  Fitch
expects that BEH group's funds from operations (FFO) to have
followed a similar trend, though cash flow from operations (CFO)
was temporarily boosted by working capital inflows (partly due to
increased overdue trade payables of NEK).  This resulted in a
substantial worsening of BEH group's credit metrics.  Fitch
expects FFO adjusted net leverage to have increased to about 8x
in 2014 from 2.8x in 2013.

Recovery Dependent on Regulatory Changes

Fitch projects a modest recovery of credit metrics in 2015-2016
depending on the implementation of the planned
regulatory/legislative changes aimed at narrowing NEK's tariff
deficit.  Fitch projects net leverage of about 6x in 2016, which
is still a very high level given BEH's business profile and the
limited predictability of the Bulgarian regulatory environment.

Liquidity May Substantially Weaken

At end-December 2014, BEH group had sufficient unrestricted cash
of BGN383 million against short-term debt of BGN146 million.
However, planned repayment of overdue trade payables of NEK in
2015 is likely to lead to a working capital outflow.  Fitch
expects this, together with capex, to lead to negative FCF and a
deterioration of the BEH group's liquidity in 2015.  Based on
preliminary numbers for 2014, BEH expects to meet a debt
incurrence covenant (EBITDA coverage ratio of no less than 4x),
as defined in the EUR500 million eurobond documentation, albeit
with limited headroom.  In Fitch view, failure to meet the
eurobond covenant resulting in limitation to raise debt would
substantially worsen BEH group's liquidity position and could
result in a liquidity crunch in 2015.

Fitch expects that the state will support BEH to avoid potential
liquidity issues.  Lack of support from the state in case of
liquidity issues may result in a removal of the one-notch uplift
for state support and a potential downgrade of the standalone
rating if the liquidity shortfall has not been remedied.

Most of BEH's debt is due in 2018 when the EUR500 million bond
(BGN1 billion) issued in 2013 matures.  Fitch expects BEH to
start the bond refinancing process well ahead of maturity.

Senior Unsecured Debt Rating

Failure to substantially improve BEH group's EBITDA in 2015-2016
so that the ratio of prior-ranking debt (the debt of subsidiaries
who do not guarantee BEH) to consolidated EBITDA returns to below
2x-2.5x may lead us to notch down the rating for senior unsecured
debt of the holding company (including for the EUR500 million
bonds) from the IDR.  This would be due to the structural
subordination of the holding company's creditors to the external
creditors lending directly to its operating companies.
Currently, the senior unsecured rating is at the same level as
the IDR but if the ratio of prior-ranking debt to consolidated
EBITDA remains well above 2x on a sustained basis then Fitch
would consider rating unsecured debt one notch lower than the
IDR.

Strong Links with the State

BEH is notched up one level from its standalone rating of 'BB-'
/RWN, reflecting the group's strong links with the Bulgarian
state, and in accordance with the agency's Parent and Subsidiary
Rating Linkage criteria.  The strong linkage is mainly evidenced
by state guarantees for about 30% of the group's debt (as of end-
2013), its strong operational ties with the state and its
strategic importance due to its dominant market position in the
country's electricity and gas market.  The state plans to
guarantee BEH's new EUR80 million loan related to a gas
interconnection project between Bulgaria and Greece.

Corporate Governance Limitations

The ratings reflect BEH's corporate governance limitations,
including a qualified audit opinion for BEH group's 2009-2013
financial statements and frequent management changes.

RATING SENSITIVITIES

Negative: Future developments that could lead to negative rating
action include:

   -- Failure to materially improve the group's EBITDA and FFO
      from the weak 2014 levels and to demonstrate de-leveraging
   -- Failure to maintain sufficient liquidity

   -- Weakening links between BEH and Bulgaria through, for
      instance, a reduction of the share of state-guaranteed debt
      to less than 10%-15% of total group debt or lack of
      additional tangible support if needed

Positive: The ratings are on Rating Watch Negative.  As a result,
Fitch's sensitivities do not currently anticipate developments
with a material likelihood, individually or collectively, of
leading to an upgrade.  Future developments that could,
nonetheless, lead to a positive rating action include:

   -- FFO adjusted net leverage below 3x on a sustained basis,
      for instance, due to a reduced capex plan and improved
      financial performance, including liquidity management and
      debt maturity profile

   -- A substantial narrowing of NEK's deficit and increased
predictability of cash flows at BEH group, for instance, due to
regulatory/legislative decisions

   -- Progress in the liberalization of the electricity market
      through a rising share of market-based pricing in the
      generation sector

KEY ASSUMPTIONS

Fitch's key assumptions within our rating case for the issuer
include:

   -- Gradual improvement in NEK's EBITDA from a preliminary
      BGN0.5 billion loss in 2014 to break-even within the next
      two to three years on the back of regulatory changes and
      renegotiation of power purchase agreements

   -- Capex of around BGN3.5 billion in 2015-2019 co-funded with
      EU grants and CO2 reimbursement.  Capex to result in
      negative FCF in the medium term

   -- Forthcoming tangible state support in case of potential
      liquidity issues

   -- No dividend pay-outs in the next three years


CORPORATE COMM'L: Parliament Amends Bank Insolvency Bill
--------------------------------------------------------
The Sofia Globe reports that Bulgaria's Parliament passed at
second reading on March 18 the bill of amendments to the Bank
Insolvency Act, which envision the appointment of a temporary
bankruptcy receiver if a lender has had its license stripped but
no insolvency proceedings are ongoing.

The bill was prompted by the ongoing saga concerning the
Corporate Commercial Bank, which was Bulgaria's fourth largest
lender when it asked to be put under the supervision of the
Bulgarian National Bank in June 2014, The Sofia Globe relays.

Following an audit report that recommended writing down about
BGN4.2 billion of impaired assets, CCB lost its license in
November 2014, but insolvency proceedings at Sofia City Court
were suspended later that month when the bank's two largest
shareholders appealed the license loss at the Supreme
Administrative Court, The Sofia Globe recounts.

Under the amended law, the courts will be required to appoint the
interim bankruptcy receiver put forth by the state deposit
guarantee fund, as long as the nominee meets the legal
pre-requisites for the position, The Sofia Globe  discloses.  It
was expected that such a receiver for CCB could be appointed as
early as next week, The Sofia Globe says, citing Bulgarian media
reports.

Bulgarian media claimed the bankruptcy receiver will take over
the bank's management from the BNB-appointed administrators,
which could lead to a number of lawsuits being filed to overturn
earlier decisions made by administrators regarding CCB's assets,
according to The Sofia Globe.

The deposit guarantee fund is CCB's largest creditor after
starting payout of depositor claims worth BGN3.6 billion in
December 2014, The Sofia Globe states.

                About Corporate Commercial Bank AD

Corporate Commercial Bank AD is the fourth largest bank in
Bulgaria in terms of assets, third in terms of net profit, and
first in terms of deposit growth.

Bulgaria's central bank placed Corpbank under its administration
and suspended shareholders' rights in June 2014 after a run
drained the bank of cash to meet client demands.



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F R A N C E
===========


SOCIETE GENERALE: S&P Lowers Rating on 2014-104 Notes to 'BBp'
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered to 'BBp' from 'BB+p'
its credit rating on Societe Generale's series 2014-104 notes.

The downgrade follows S&P's Feb. 27, 2015 lowering to 'BB' from
'BB+' of its long-term issuer credit rating on Avon Products Inc.

Under S&P's criteria for rating repackaged securities, it weak-
link its rating on Societe Generale's series 2014-104 notes to
the lowest of S&P's long-term ICR on:

   -- Societe Generale as the issuer;
   -- Societe Generale, New York Branch as the guarantor; and
   -- Avon Products as the reference entity.

Therefore, following S&P's recent downgrade of Avon Products, S&P
has consequently lowered to 'BBp' from 'BB+p' its rating on
Societe Generale's series 2014-104 notes.



===========
G R E E C E
===========


GREECE: Talks with International Creditors Make Little Progress
---------------------------------------------------------------
Gabriele Steinhauser and Viktoria Dendrinou at The Wall Street
Journal report that talks between Greece and its international
creditors have made little progress, officials said, with each
side blaming the other for the snags in negotiations over the
future of the country's bailout.

According to the Journal, two European officials on March 18 said
Greek officials are providing teams from the European Commission,
the European Central Bank and the International Monetary Fund
with very little information on the government's finances and its
plans for overhauling its economy and public sector.

A Greek official said the technical teams had gone beyond their
role as fact-finders and had sought to intervene in politics,
continuing a frequent line of complaint from Athens about the
so-called troika of inspectors, the Journal relays.

During the teleconference, the Greek representative said his
government wasn't prepared to talk about finances with technical
experts, the Journal notes.

Eurozone finance ministers agreed in February to extend Greece's
EUR240 billion (US$254 billion) bailout by four months, until the
end of June, the Journal relates.  However, there has been little
progress on defining what Greece has to do in return for
sustained aid, adding to concerns over the country's future in
the eurozone, the Journal says.

Representatives of the three institutions, as cited by the
Journal, said that, based on the limited information they have,
the Greek government would be able to sustain payments only for
another few weeks.



=========
I T A L Y
=========


PIAGGIO & C: Moody's Says Performance Could Improve in 2015
-----------------------------------------------------------
While Piaggio & C. S.p.A.'s (Piaggio, Ba3 negative) leverage
continues to linger at elevated levels the company's operating
performance is likely to recover somewhat in 2015, says Moody's
Investors Service in a report published March 18, 2015.

"We expect to see double-digit growth in the company's EBITDA in
2015, driven by top-line growth in emerging markets and improved
efficiency," says Lorenzo Re, a Moody's Vice President - Senior
Analyst and author of the report. "If this happens, we would
expect Piaggio's credit metrics to improve."

Moody's notes that Piaggio's leverage remains high with an
adjusted debt/EBITDA ratio of 5.4x at the end-2014 on a
preliminary basis.  Despite the increase in EBITDA, free cash
flow remained negative. Retained cash flow (RCF)/net debt
improved to 7.7% in 2014 from the weak 3.7% in 2013.

Piaggio's solid market positioning in some major Asian markets
(i.e., India, Vietnam and Indonesia) is a major strength and
supports the company's earnings growth prospects.  While
volatility was high in these markets in 2013-14, they have turned
positive and Moody's expects this momentum to continue through
2015, especially in India.



===================
L U X E M B O U R G
===================


AURIS LUXEMBOURG II: S&P Assigns 'B+' CCR; Outlook Stable
---------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' long-term
corporate credit rating to Auris Luxembourg II S.a.r.l
(Sivantos), a Luxembourg-based holding company set up for the
acquisition of hearing instruments manufacturer Sivantos Group by
a consortium of investors led by Swedish private equity firm,
EQT.  The outlook is stable.

At the same time, S&P assigned a 'B+' issue rating to the EUR75
million revolving credit facility (RCF) and the EUR785 million
first-lien term loan to be issued by Auris III Luxembourg
S.a.r.l. S&P has assigned recovery ratings of '3' to these
instruments, in the higher half of the range, indicating S&P's
expectation of meaningful (50%-70%) recovery prospects in the
event of a payment default.

S&P also assigned a 'B-' issue rating to the EUR275 million
senior unsecured notes to be issued by Auris Luxembourg II
S.a.r.l.  The recovery rating on the notes is '6', indicating
S&P's expectation of negligible (0%-10%) recovery in the event of
a payment default.

Sivantos is a leading manufacturer and distributor of hearing aid
devices and accessories, which markets the majority of its
products through the Siemens AudioServices and Rexton brands.
The ratings on Sivantos are constrained by its relatively small
size, product concentration, and the presence of innovation risk,
reflected in S&P's business risk profile assessment of "fair."
The group's majority financial sponsor ownership by EQT, with
adjusted leverage of around 8.5x pro forma the transaction,
underpins S&P's "highly leveraged" financial risk profile
assessment.

S&P's positive comparable rating analysis primarily reflects
Sivantos' strong free cash flow generation and cash interest
coverage, supported by S&P's calculation of funds from operations
(FFO) to cash interest coverage comfortably above 2x.  It further
reflects S&P's view of Sivantos' business risk profile as firmly
within the "fair" category, reflecting that the company is
steadily improving its EBITDA margin.

S&P's business risk profile assessment is constrained by
Sivantos' relatively small size and its product concentration.
Although Sivantos occupies the No. 3 position in the global
hearing aids market, it remains smaller in size relative to
larger industry peers Sonova and William Demant (both not rated).
In 2014, Sivantos had revenues of around EUR690 million and a
market share of about 15%.  In comparison, market leader Sonova
generated revenues of about EUR1.6 billion with about 30% market
share.  The group's larger competitors benefit from a greater
presence in the key U.S. market, as well as a higher perception
of innovativeness in recent years.  The group also has
significant product and brand concentration; the majority of
group revenues are derived from hearing aids as well as the
Siemens brand.  As part of the transaction, S&P understands that
Sivantos is permitted to continue marketing its products through
the Siemens brand over the medium term.  S&P expects the pricing
environment to remain challenging over the near term in Sivantos'
main markets in the U.S. and Europe, as customers continue to
seek cost savings amid a tough reimbursement environment.  This
pricing pressure has been exacerbated for Sivantos due to its
historical focus on large key accounts.  Although this provides
for higher volume potential, such customers have greater
bargaining power and often drive discounts and promotions.
However, S&P understands that Sivantos is actively managing its
channel mix with a growing focus toward the more profitable
independent sector, as well as adopting a more selective approach
to contract renewals with its large key accounts.

These weaknesses are partially offset by the positive
characteristics of the global hearing aids market and the group's
strengthened pipeline of new products.  The EUR5 billion global
hearing aids market (including wholesale and retail) is highly
consolidated around the top six players, which account for over
90% of the market.  The industry is also characterized by high
barriers to entry posed by intellectual property rights,
regulation, and substantial upfront research and development
(R&D) investment.  It also benefits from long-term growth
prospects due to an ageing population and an increasing
penetration of hearing loss, with an expected compound annual
growth rate of around 5% in the near term.  What's more, there is
little substitution risk from alternative technologies such as
cochlear implants, which require surgery and represent a more
expensive solution.  Although Sivantos has historically lagged
behind its competitors in terms of innovation and product
launches, this has started to change after the successful launch
of its "micon" product range in 2012. This is gradually improving
the group's proportion of revenues from new products, those
launched within the past two years. Furthermore, the recent
launch of the group's new platform, "binax", has received
positive market feedback during its early stages and is expected
to significantly close the perceived technology gap between
Sivantos and its competitors.  Sivantos now spends approximately
7% of revenues on R&D, in line with its larger industry peers.

Furthermore, S&P views Sivantos' customer diversity as adequate,
with no single customer accounting for more than 10% of revenues.
S&P also views positively the various operational efficiencies
that the group is engaging in, optimizing its manufacturing
footprint to lower-cost countries such as China and Poland, and
shifting toward automated manufacturing processes for new
products.

S&P's assessment of Sivantos' financial risk profile is
underpinned by the group's majority ownership by financial
sponsor, EQT, and S&P's expectation that its adjusted leverage
will remain around 8.5x over the next three years on average.
S&P's calculation includes just over EUR1 billion of financial
debt in the form of the proposed term loans and unsecured notes,
EUR200 million of a preferred equity instrument held by Siemens
AG, EUR180 million of a preferred equity instrument held by Santo
Holding GmbH, an investment vehicle of the Strungmann family.
Although S&P views these latter instruments as debt-like, it
recognizes their cash-preserving function.  Excluding these debt-
like instruments the leverage would be about 6x.

S&P does not deduct cash from its leverage calculation as this
has not been ring-fenced for debt repayments and could be used
for other purposes, such as acquisitions.

S&P is currently excluding about EUR670 million of preferred
equity instruments held by EQT from S&P's debt calculation as the
company is strengthening equity-like features of the instruments,
mainly the "stapling" clause.  However, should the company fail
to amend the terms and conditions of these instruments, S&P would
include them in its debt calculations, possible resulting in a
negative rating action on Sivantos.

Despite some amortized payments under the terms of the first-lien
term loan, S&P expects leverage to remain high over the near
term. This is partially offset by S&P's view of the group's
relatively strong cash flow protection, as it expects FFO cash
interest coverage to remain above 2x, and Sivantos' strong free
cash flow generation of at least EUR40 million per year going
forward.

S&P's base-case assumes:

   -- 4%-5% revenue growth over the near term, mainly driven by
      increasing volumes and successful commercialization of new
      products;

   -- A slight improvement in the EBITDA margin toward the mid-
      20s, supported by operational efficiencies and an
      improvement in the channel mix;

   -- Capital expenditure (capex) of 3%-4% of revenues per year;
      and

   -- Limited acquisitions in the near term.

Based on these assumptions, S&P arrives at these credit measures:

   -- Adjusted debt to EBITDA of around 8.5x over the next three
      years on average; and

   -- FFO cash interest coverage of about 2.5x over the next
      three years on average.

The company's EUR75 million RCF has a springing covenant with a
maximum leverage ratio test that only becomes effective if more
than 30% of the facility is drawn.

The stable outlook reflects S&P's expectation that, over the next
12-18 months Sivantos will further improve on its recent
operating performance, despite pricing pressure and the
consolidated nature of the hearing instruments industry.  S&P
anticipates that the group will maintain its market position and
increase profitability with an EBITDA margin approaching 25%,
through the successful commercialization of new products,
realization of planned operational efficiencies, and improving
its channel mix.  S&P views adjusted FFO cash interest coverage
comfortably exceeding 2x at all times, as is commensurate with
the 'B+' rating.

S&P also expects that EQT will take steps to align the terms and
conditions of its shareholder instruments in line with S&P's
criteria so that they can be excluded from our debt calculations.

Downside scenario

S&P could also lower the ratings if adjusted FFO cash interest
coverage falls below 2x or, in S&P's view, Sivantos' liquidity
deteriorates to below "adequate."  This would most likely occur
if Sivantos experiences adverse operating developments that would
lead to significantly weaker EBITDA, likely due to its Binax
product not being able to gain traction in the market due to
significant competition, or the group facing difficulties in
growing its share of independent sector revenues.

Upside scenario

A positive rating movement is unlikely over the next 12-18
months, as S&P projects debt to EBITDA to remain above 5x and as
such in the "highly leveraged" category.  However, S&P would
likely take a positive rating action if the company sustains
adjusted debt to EBITDA of less than 5x.  In view of the amount
of deleveraging required to achieve this, S&P considers it would
most likely occur because of a change in financial policy.

Ratings Score Snapshot

Corporate Credit Rating: B+/Stable/--

Business risk: Fair

   -- Country risk: Low
   -- Industry risk: Low
   -- Competitive position: Fair
   -- Financial risk: Highly leveraged

   -- Cash flow/Leverage: Highly leveraged

Anchor: b

Modifiers

   -- Diversification/Portfolio effect: Neutral (no impact)
   -- Capital structure: Neutral (no impact)
   -- Liquidity: Adequate (no impact)
   -- Financial policy: FS-6 (no impact)
   -- Management and governance: Fair (no impact)
   -- Comparable rating analysis: Positive (+1 notch)

Recovery Analysis

Key analytical factors

   -- The senior secured debt has an issue rating of 'B+' and a
      recovery rating of '3' in the higher half of the range.
      The recovery rating reflects S&P's view of a comprehensive
      guarantor package, but is constrained by S&P's view of a
      weak security package (pledges over shares, bank accounts,
      and receivables) and documentation (given only one
      covenant, a net leverage tested only when RCF is drawn over
      30%, and the ability for the company to incur additional
      senior debt up to EUR100 million or senior net leverage up
      to 4.75x).

   -- The issue and recovery rating on the senior unsecured debt
      are 'B-' and '6', respectively, reflecting their
      contractual and structural subordination to the senior
      loans.

   -- S&P's simulated default scenario assumes a combination of
      loss of market share and margin contraction driven by
      increased competition and inability to renew contracts from
      key customers.  S&P's going concern valuation is based on
      the company's leading market position and diversified
      global revenue base.

Simulated default assumptions

   -- Year of default: 2018
   -- EBITDA at emergence: EUR106 million
   -- Implied enterprise value multiple: 5.5x
   -- Jurisdiction: Singapore

Simplified waterfall

   -- Gross enterprise value at default: EUR583 million
   -- Administrative costs:EUR29 million
   -- Net value available to creditors:EUR554 million
   -- Priority claims: EUR10 million
   -- Secured debt claims:EUR852 million*
   -- Recovery expectation:50%-70% (higher half of the range)
   -- Unsecured debt claims:EUR286 million*
   -- Recovery expectation: 0%-10%

* All debt amounts include six months' prepetition interest.



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


CLONDALKIN INDUSTRIES: S&P Affirms 'B' Corporate Credit Rating
--------------------------------------------------------------
Standard & Poor's Ratings Services said that it affirmed its 'B'
long-term corporate credit rating on The Netherlands-based
packaging group Clondalkin Industries B.V.  At the same time, S&P
removed the rating from CreditWatch with developing implications,
where it initially placed it on Nov. 14, 2014.

S&P also took these issue rating actions:

   -- It affirmed its 'B' issue rating and revised the recovery
      rating to '4' from '3' on Clondalkin's US$35 million
      revolving credit facility (RCF) due 2018 and US$360 million
      senior secured first-lien term loan due 2020, which has now
      been reduced to US$135 million.

   -- S&P withdrew its issue rating on the US$95 million secured
      second-lien term loan due 2020, which are being repaid in
      full.

The affirmation follows the completion of the disposal of
Clondalkin's specialty packaging division to Essentra PLC for
$475 million (including 20 million for tax attributes), and the
allocation of proceeds to partly repay the senior secured first-
lien term loan, fully repay the secured second-lien term loan,
and partly repay shareholder loans.  In S&P's view, this will
result in a leverage ratio that it forecasts will be in the range
of 11.0x-12.0x in 2015 and 2016, including the subordinated non-
cash pay shareholder loans that S&P treats as debt.

"We have also revised our assessment of Clondalkin's business
risk profile to "weak" from "fair", as our criteria defines these
terms.  Although Clondalkin continues to enjoy market leading
positions and retains a good degree of geographical, product,
end-market, and customer diversity -- albeit with more limited
scale -- the flexible packaging sector is more fragmented and
carries somewhat lower profitability.  In addition, the stand-
alone flexible packaging business tends to exhibit relatively
higher volatility in profitability compared to the combined
group. Clondalkin is also exposed to volatility in raw material
and energy costs, which can cause disruptions in price and
demand, as customers re-stock or de-stock inventories while
awaiting price stabilization," S&P said.

"Clondalkin's "highly leveraged" financial risk profile reflects
its still-weak credit metrics given the presence of significant
shareholder loans that generate payment-in-kind (PIK) interest at
a relatively moderate rate of 7.57%.  No cash interest can be
paid on these loans until redemption, which is a support for the
rating.  Excluding these instruments, adjusted senior leverage
would be less aggressive at 4.0x-5.0x.  Our assessment also
reflects the group's private equity ownership, which implies
tolerance for high leverage, and its history of significant
acquisitions and disposals as seen in the recent disposal of its
specialty packaging segment.  That said, Clondalkin has
historically benefited from robust, positive cash flow
generation, which we expect will continue post the disposal,
following renewed focus on the organic growth and margins of the
flexible packaging business.  We forecast the group will generate
positive cash flows in the near term," S&P added.

S&P's assessment of Clondalkin's business risk profile as "weak"
and financial risk profile as "highly leveraged" leads to anchor
scores of 'b/b-'.  S&P's initial analytical outcome (anchor) of
'b' reflects its view that the relative strength of the company's
highly leveraged financial risk profile is somewhat stronger than
'b-' peers that exhibit higher senior leverage.  Although core
credit metrics are comparatively weak, S&P anticipates
Clondalkin's funds from operations (FFO) cash interest coverage
to be considerably stronger, at 5.0x-5.5x, as a result of
substantially reduced cash interest expense post the reduction in
senior debt.

S&P's base case assumes:

   -- Revenues to almost halve in 2015 given the disposal of the
      specialty packaging segment.  From 2016 onward, S&P expects
      the revenues to grow modestly in the low-single-digit
      range.

   -- Broadly stable EBITDA margins remaining marginally below
      10%.

   -- Cash interest expense to reduce significantly with the
      reduction in term loans.

   -- Capital expenditure (capex) in the region of EUR10 million.

   -- Positive free operating cash flows in both 2015 and 2016.

Based on these assumptions, S&P arrives at these fully adjusted
credit measures for 2015 and 2016:

   -- EBITDA margin of about 9%-10%.
   -- Adjusted FFO to debt of around 2%.
   -- Debt to EBITDA between 11.0x and 12.0x.

S&P assess Clondalkin's liquidity as "adequate" under S&P's
criteria.  S&P forecasts that Clondalkin's sources of liquidity
will exceed its uses by more than 1.2x over the next 12 months
following the disposal of the specialty packaging business and
reduction of debt and dividend payment from the proceeds.

The stable outlook reflects S&P's view that Clondalkin Industries
B.V.'s margins should remain broadly stable over the next 12-18
months, resulting in operating performance and credit metrics
commensurate with the current ratings.  S&P anticipates that
Standard & Poor's adjusted debt to EBITDA -- including
shareholder loans -- to be in the range of 11.5x-12.5x, while
cash interest coverage will remain over 2x during the next few
years.

S&P could raise the rating by one notch if it believes the group
can sustain reduced leverage below 5x.  S&P considers the
potential for raising the rating further to be limited, given the
group's significant shareholder loans and aggressive financial
policies, which include tolerance for a highly leveraged capital
structure.

S&P do not expect to lower the ratings unless the company
undertakes aggressive acquisitions or makes changes to its
capital structure.  That said, S&P could lower the rating if
Clondalkin's operating performance declined materially beyond
S&P's base-case forecast, as a result of weakening demand for
Clondalkin's services, especially in its main markets of Europe
and North America.  Specifically, S&P could lower the rating if
the group's cash interest coverage drops to less than 2x, or
there is pressure on the group's liquidity.


DPX HOLDINGS: S&P Retains 'B' CCR Following EUR150MM Loan Add-On
----------------------------------------------------------------
Standard & Poor's Ratings Services said that its ratings on
Durham, N.C.-based pharmaceutical contract services provider DPx
Holdings B.V., including its 'B' corporate credit rating, are not
affected by the company's announcement that it will issue an
incremental EUR150 million first-lien term loan add-on to fund
the acquisition of Florence, S.C.-based active pharmaceutical
ingredient manufacturer IRIX Pharmaceuticals Inc.  The
transaction is expected to close in the second quarter of 2015.
S&P's rating on the term loan remains 'B' with a '3' recovery
rating, which indicates S&P's expectation for meaningful recovery
(in the lower end of the 50% to 70% range) in the event of
default.

While the additional debt further increases leverage above 7x,
the transaction is consistent with S&P's assessment of DPx's
financial risk profile as "highly leveraged" and S&P's
expectations that DPx will continue to be aggressive in pursuing
acquisitions that further strengthen and broaden its drug
manufacturing and development services.  IRIX further adds to
DPx's development and manufacturing capabilities for active
pharmaceutical ingredients in the U.S.  S&P's "fair" business
risk assessment remains unchanged.

RECOVERY ANALYSIS

Key analytical factors

   -- S&P has updated its recovery analysis and its recovery
      ratings are unchanged despite the modest change in the
      capital structure.  The incremental EUR150 million euro
      tranche will benefit from the same guarantee and security
      package as the existing first lien facilities, which has
      increased with the addition of the Irix assets.

   -- The recovery rating of '3' on the senior secured credit
      facilities reflects S&P's expectation for meaningful (50%
      to 70%) recovery in the event of a default.  S&P estimates
      that, for the company to default, EBITDA would need to
      decline significantly, stemming from increased competition
      or damage to the company's market reputation.

Simulated default and valuation assumptions (US$ mil.)

   -- Simulated year of default: 2018
   -- EBITDA at emergence: 226
   -- EBITDA multiple: 6.0x

Simplified waterfall

   -- Net enterprise value (after 7% admin. costs): 1,262
   -- Valuation split in % (Obligors/Non-obligors): 74/26
   -- Nonobligor liabilities: 159
   -- Collateral value available to first-lien creditors: 1,048
   -- Secured first-lien debt: 1,884
   -- Recovery expectations: 50% to 70% (in the lower half of the
      range)
   -- Collateral value available to unsecured lenders: 56
   -- Unsecured debt: 467
   -- Total unsecured claims: 1,595
   -- Recovery expectations: 0% to 10%

Notes: All debt amounts include six months of prepetition
interest.  Collateral value equals asset pledge from obligors
plus pro rata share in non-obligor equity after non-obligor
liabilities.

RATINGS LIST

DPx Holdings B.V.
Corporate Credit Rating              B/Stable/--

Rating Unchanged After Add-On

DPx Holdings B.V.
EUR470 Mil. First-Lien Term Loan     B
   Recovery Rating                    3L


GROSVENOR PLACE III: Moody's Affirms Ba3 Rating on Cl. E Notes
--------------------------------------------------------------
Moody's Investors Service upgraded the ratings on the following
notes issued by Grosvenor Place CLO III B.V.:

  -- EUR62,000,000 Class A-3 Senior Floating Rate Notes due 2023,
     Upgraded to Aaa (sf); previously on Dec 20, 2013 Upgraded to
     Aa1 (sf)

  -- EUR36,500,000 Class B Deferrable Interest Floating Rate
     Notes due 2023, Upgraded to Aa1 (sf); previously on Dec 20,
     2013 Upgraded to A1 (sf)

  -- EUR20,000,000 Class C Deferrable Interest Floating Rate
     Notes due 2023, Upgraded to A2 (sf); previously on Dec 20,
     2013 Upgraded to A3 (sf)

Moody's Investors Service has also affirmed the ratings on the
following notes:

  -- EUR128,500,000 (outstanding balance of EUR34.8M) Class A-1
     Senior Floating Rate Notes due 2023, Affirmed Aaa (sf);
     previously on Dec 20, 2013 Affirmed Aaa (sf)

  -- Up to EUR120,000,000 (outstanding balance of EUR39.6M) Class
     A-2 Senior Revolving Floating Rate Notes due 2023, Affirmed
     Aaa (sf); previously on Dec 20, 2013 Affirmed Aaa (sf)

  -- EUR28,500,000 Class D Deferrable Interest Floating Rate
     Notes due 2023, Affirmed Ba1 (sf); previously on Dec 20,
     2013 Upgraded to Ba1 (sf)

  -- EUR14,000,000 Class E Deferrable Interest Floating Rate
     Notes due 2023, Affirmed Ba3 (sf); previously on Dec 20,
     2013 Upgraded to Ba3 (sf)

Grosvenor Place CLO III B.V., issued in August 2007, is a
collateralized loan obligation (CLO) backed by a portfolio of
mostly high-yield senior secured European loans.  The portfolio
is managed by CQS Cayman Limited Partnership. The transaction's
reinvestment period ended in October 2013.

The rating actions on the notes are primarily the result of the
deleveraging that have occurred over the last two payment dates
in April and October 2014.

The Class A has amortized approximately EUR180 million over the
last two payment dates. As a result of the deleveraging, over-
collateralization (OC) ratios have increased. According to the
January 2015 trustee report the OC ratios of Classes A, B, C, D
and E are 188.7%, 148.9%, 133.4%, 116.3%,109.4 % compared to
138.3%, 123.7%, 116.9%, 108.5%, 104.7% respectively in January
2014.

The key model inputs Moody's uses in its analysis, such as par,
weighted average rating factor, diversity score and the weighted
average recovery rate, are based on its published methodology and
could differ from the trustee's reported numbers. In its base
case, Moody's analyzed the underlying collateral pool as having a
performing par EUR167.3 million, GBP6.8 million, and USD43.0
million, principal proceeds balance of EUR31.7 million, GBP3.9
million, and USD6.5 million, no defaulted par, a weighted average
default probability of 24.2% (consistent with a WARF of 3231), a
weighted average recovery rate upon default of 47.4% for a Aaa
liability target rating, a diversity score of 18 and a weighted
average spread of 4.27%. The GBP and USD denominated liabilities
are naturally hedged by the GBP and USD assets.

The default probability derives from the credit quality of the
collateral pool and Moody's expectation of the remaining life of
the collateral pool. The estimated average recovery rate on
future defaults is based primarily on the seniority of the assets
in the collateral pool. For a Aaa liability target rating,
Moody's assumed a recovery of 50% of the 92.6% of the portfolio
exposed to first-lien senior secured corporate assets upon
default and of 15% of the remaining non-first-lien loan corporate
assets upon default. In each case, historical and market
performance and a collateral manager's latitude to trade
collateral are also relevant factors. Moody's incorporates these
default and recovery characteristics of the collateral pool into
its cash flow model analysis, subjecting them to stresses as a
function of the target rating of each CLO liability it is
analyzing.

The principal methodology used in this rating was "Moody's Global
Approach to Rating Collateralized Loan Obligations" published in
February 2014.

In addition to the base-case analysis, Moody's conducted
sensitivity analyses on the key parameters for the rated notes,
for which it assumed a lower weighted average recovery rate in
the portfolio. Moody's ran a model in which it reduced the
weighted average recovery rate by 5%; the model generated outputs
were within one notch of the base-case result.

This transaction is subject to a high level of macroeconomic
uncertainty, which could negatively affect the ratings on the
note, in light of uncertainty about credit conditions in the
general economy. CLO notes' performance may also be impacted
either positively or negatively by 1) the manager's investment
strategy and behavior and 2) divergence in the legal
interpretation of CDO documentation by different transactional
parties because of embedded ambiguities.

Additional uncertainty about performance is due to the following:

- Portfolio amortization: The main source of uncertainty in this
   transaction is the pace of amortization of the underlying
   portfolio, which can vary significantly depending on market
   conditions and have a significant impact on the notes'
   ratings.  Amortization could accelerate as a consequence of
   high loan prepayment levels or collateral sales by the
   collateral manager or be delayed by an increase in loan amend-
   and-extend restructurings.  Fast amortization would usually
   benefit the ratings of the notes beginning with the notes
   having the highest prepayment priority.

- Around 11% of the collateral pool consists of debt obligations
   whose credit quality Moody's has assessed by using credit
   estimates.  As part of its base case, Moody's has stressed
   large concentrations of single obligors bearing a credit
   estimate as described in "Updated Approach to the Usage of
   Credit Estimates in Rated Transactions," published in October
   2009.

- Foreign currency exposure: The deal has a significant
   exposures to non-EUR denominated assets. Volatility in foreign
   exchange rates will have a direct impact on interest and
   principal proceeds available to the transaction, which can
   affect the expected loss of rated tranches.

In addition to the quantitative factors that Moody's explicitly
modelled, qualitative factors are part of the rating committee's
considerations.  These qualitative factors include the structural
protections in the transaction, its recent performance given the
market environment, the legal environment, specific documentation
features, the collateral manager's track record and the potential
for selection bias in the portfolio.  All information available
to rating committees, including macroeconomic forecasts, input
from other Moody's analytical groups, market factors, and
judgments regarding the nature and severity of credit stress on
the transactions, can influence the final rating decision.



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


MOBILE TELESYSTEMS: Fitch Affirms BB+ IDR; Outlook Stable
---------------------------------------------------------
Fitch Ratings has affirmed OJSC Mobile Telesystems' (MTS) Long-
Term Issuer Default Rating (IDR) at 'BB+ and removed all ratings
from Rating Watch Negative (RWN).  The Outlook on the IDR is
Stable.

MTS is a leading Russian and CIS mobile operator with modest
leverage and strong free cash flow generation.  It is the largest
operator in Russia and the second largest in Ukraine by
subscribers.  The company is majority controlled by Sistema Joint
Stock Financial Corp. (BB-/Stable).

KEY RATING DRIVERS

Litigation Risk for Sistema Removed

The RWN has been removed as Fitch believes that Sistema is no
longer at risk from any litigation against it in connection to
Bashneft, Sistema's oil and gas subsidiary that was handed back
to the state in line with a court decision.  This in turn removes
the risk that MTS would be negatively impacted by any
developments at Sistema.

Fundamentals Overlaid by Shareholding

On a standalone basis, MTS's credit profile is commensurate with
a low investment-grade rating.  Its ratings are notched down for
the negative influence of its controlling shareholder, Sistema.
Under Fitch's methodology, a subsidiary can generally be rated a
maximum of two notches above its parent in the presence of weak
parent/subsidiary links.

Resilient Industry, Weak Economy

The weak economy in Russia will be weighing on the company's
growth rates but is unlikely to lead to pronounced revenue
pressure, in our view.  The telecom industry is likely to
demonstrate strong defensive qualities, as was evidenced in the
aftermath of the 2008 financial crisis.  Fitch expects the
company's revenue to remain largely flat supported by continuing
strong demand for data.  A key risk to this scenario may stem
from additional macro pressures, significantly above Fitch's
current expectations.

The Russian economic environment is weak with a reported yoy
annualized GDP contraction of 1.1% in Jan 2015.  The economic
outlook for the country remains weak.  Fitch expects the economy
to contract by 4% in 2015.  Consumer confidence has been
negatively impacted by significant rouble depreciation in 4Q14.
This also triggered a sharp rise in inflation to almost 17% in
February 2015 although this is expected to abate by the year end,
with Fitch forecasting end-2015 inflation of 8.5%.

Inflation and Cost Cutting

MTS's margins are likely to come under modest pressure, an impact
of high cost inflation that may be only partially remedied by
continuing efforts to reduce costs and improve efficiency.  MTS's
cost base is predominantly in roubles, which would protect it
from the immediate negative impact of rouble depreciation.

However, a significant portion of network equipment and spare
parts are imported.  Higher rouble prices on imported items would
inevitably weigh on the bottom line.  Fitch estimates the company
will not be able to compensate this with higher prices as tariffs
will not be raised in line with inflation.

Significant Ukraine Investment Unlikely

MTS won a 3G license in Ukraine in February 2015, where the
network development is likely to require some parental financing.
However, we do not expect significant new investment.  Ukraine's
business has been consistently cash flow positive as suggested by
reported OIBDA minus capex, and should generate sufficient funds
for maintaining operations and organic development.  Capital
controls in Ukraine effectively prohibit any cash outflows from
this subsidiary to the parent.  Under the circumstances,
reinvesting accumulated cash into 3G development is the best
available option.

Strong FCF Generation

MTS is likely to maintain or improve its strong FCF generation
driven by a disciplined approach to network investment.  Fitch
expects the company to sustainably maintain pre-dividend FCF
margin in the low double-digit territory.  Russian telecom
operators are bracing themselves for a protracted period of high
interest rates and limited liquidity which discourages active
expansion plans.  MTS is likely to be able to retain its
competitiveness even with lower capex as long as its peers also
remain disciplined with their investment plans.

Rational Competition to Continue

The Russian market is strongly competitive, with four national
facilities-based mobile operators.  However, the 2014 merger of
Rostelecom's and Tele2 Russia's mobile assets into new company
LLC T2 RTK Holding (B+/Stable) reduced disruptive pressures in
many regions.  While the new operator is targeting higher market
share, the focus is likely to be on service quality with
contained price competition in key areas, including in Moscow.

Moderate Leverage

MTS's leverage is likely to remain moderate at below 1.5x net
debt/EBITDA and 2.5x FFO adjusted net leverage (estimated by
Fitch at 1.3x net debt/EBITDA and 1.9x FFO adjusted net leverage
without the potential positive impact of hedging and assuming Rub
21bn of restricted cash at end-2014) .  High interest rates in
Russia encourage deleveraging, but the company is likely to
continue paying substantial dividends up-streaming almost the
entire FCF to shareholders.

Sufficient Liquidity

The company's debt maturity profile is well spread, with annual
principal payments of below RUB50 billion per annum (equal to
0.3x of annual EBITDA) till 2019.  Heavy rouble depreciation
caused the proportion of foreign currency debt to rise to around
25% of the total at end-2014 vs. 23% at end-3Q14.  Fitch believes
that the brunt of the rouble's depreciation has already taken
place, so significant further negative impact from further
currency weakness is unlikely.  The company has sufficient bank
liquidity to cover its short to medium term refinancing needs.

KEY ASSUMPTIONS

   -- Largely stable revenue
   -- Modest EBITDA margin pressure, most pronounced in 2015
   -- Gradually rising interest payments as historic low-interest
      debt instruments are replaced with more expensive debt
   -- Capital expenditure at around 22% of revenue
   -- Generous dividend distributions in the medium term, in line
      with the current dividend policy
   -- Modest investments into acquisitions, including into
      recapitalization of partially-owned MTS Bank.

RATING SENSITIVITIES

MTS's rating could benefit from an upgrade of Sistema's rating
provided that MTS continues to adhere to high corporate
governance standards.

A downgrade could arise from weaker corporate governance but also
excessive shareholder remuneration and other developments that
lead to a sustained rise in funds from operations adjusted net
leverage to above 3.0x.  Competitive weaknesses and market-share
erosion, leading to significant deterioration in pre-dividend FCF
generation, may also become a negative rating factor.

Full List of Rating Actions

  Long-Term IDR: affirmed at 'BB+'; off RWN; Outlook Stable
  Short-Term IDR: affirmed at 'B'; off RWN
  Local currency Long-Term IDR: affirmed at 'BB+; off RWN;
   Outlook Stable
  Local currency Short-Term IDR: affirmed at 'B'; off RWN
  National Long-Term Rating: affirmed at 'AA(rus)'; off RWN;
   Outlook Stable
  Senior unsecured debt: affirmed at 'BB+' foreign and local
   currency, 'AA(rus)'; off RWN
  Loan participation notes issued by MTS International Funding
   Ltd and guaranteed by MTS: affirmed at 'BB+'; off RWN


MTS BANK: Fitch Affirms 'B+' IDR; Outlook Stable
------------------------------------------------
Fitch Ratings has affirmed PJSC MTS Bank's (MTSB) Long-term
Issuer Default Rating (IDR) at 'B+' and removed it from Rating
Watch Negative (RWN).  The Outlook is Stable Outlook.

This commentary also serves as a correction to those published on
Sept. 18, 2014, and March 13, 2015.  The former should have
placed the Short-term IDR on RWN, while in the latter it was
unaffected and remained on RWN.  Fitch has now affirmed the
Short-term IDR and removed it from RWN.

KEY RATING DRIVERS - IDRS, NATIONAL LONG-TERM RATING, SUPPORT
RATING

The removal of the RWN on MTSB mirrors the rating action on its
parent Sistema Joint Stock Financial Corporation.  MTSB's IDRs,
National Long-term Rating and Support Rating factor in the
likelihood of support the bank may receive, if needed, from its
major owner, Sistema, and/or its subsidiaries.

In Fitch's view, Sistema's propensity to provide support is
likely to be high, given the majority ownership; MTSB's role
within the group, including its treasury functions; the track
record of capital support, including RUB13.1 billion contributed
in 4Q14; the brand association with OJSC Mobile TeleSystems (MTS,
BB+/Stable), a major operating subsidiary of Sistema; and the
significant risks of reputational and market access damage for
the group in case of MTSB's default.  Fitch considers that the
cost of any potential support would likely be manageable,
relative to the size and financial ability of the broader group.

At the same time, the current one-notch difference between the
ratings of Sistema and MTSB reflects the bank's weak performance
to date and its limited strategic importance for the group.

RATING SENSITIVITIES - IDRS, NATIONAL LONG-TERM RATING, SUPPORT
RATING

An upgrade of Sistema would likely result in an upgrade of MTSB's
support-driven ratings.  However, a prolonged period of weak
performance at MTSB could negatively impact the group's long-term
commitment to the bank's development, perhaps limiting the
potential for rating upside.  Failure of the parent to provide
timely support, if needed, could result in a downgrade of the
support-driven ratings.

KEY RATING DRIVERS - VIABILITY RATING (VR)

MTSB's 'b-' VR is driven by the bank's weak asset quality,
performance and strategy execution.  However, the rating is
supported by the still reasonable capital buffer following the
equity contribution in 4Q14, positive pre-impairment
profitability on a cash basis and an adequate liquidity position
underpinned by significant and rather cheap funding from its
parent and affiliated entities.

RATING SENSITIVITIES - VR

A marked deterioration in the capital position as a result of
further asset quality problems and operational losses could lead
to a downgrade of the VR.  The VR could stabilize at its current
level in case of a stabilization of the operating environment and
from improvements in asset quality, resulting in stronger
financial performance.

The rating actions are:

  Long-term IDR affirmed at 'B+', removed from RWN, Stable
   Outlook
  Short-term IDR affirmed at 'B', removed from RWN
  National Long-term Rating affirmed at 'A-(rus)', removed from
   RWN, Stable Outlook
  Viability Rating affirmed at 'b-'
  Support Rating affirmed at '4', removed from RWN


SISTEMA JSFC: Fitch Affirms 'BB-' IDR; Outlook Stable
------------------------------------------------------
Fitch Ratings has affirmed Sistema Joint Stock Financial Corp.'s
Long-Term Issuer Default Rating (IDR) at 'BB-' and removed all
ratings from Rating Watch Negative (RWN).  The Outlook on the IDR
is Stable.

Sistema is a diversified holding company with its key asset a
controlling stake in OJSC Mobile TeleSystems (MTS; BB+/Stable), a
large telecoms operator in Russia and CIS.  Sistema's credit
profile is primarily shaped by its ability to control cash flows
and upstream dividends from MTS.  This is overlaid by a
significant debt burden at the holdco level including exposure to
substantial off-balance-sheet liabilities related to its
subsidiaries.

KEY RATING DRIVERS

End of Bashneft Litigation

The RWN has been removed as Fitch believes that Sistema is no
longer at risk from any litigation against it in connection to
Bashneft, its oil and gas subsidiary that was handed back to the
state in line with a court decision.  This is likely to draw a
line under its losses in relation to the Bashneft seizure.

After the Russian court ruled that Sistema-controlled oil and gas
subsidiary Bashneft was privatized improperly and had to be
returned to the state, the company decided not to appeal this
decision.  In a separate case initiated by Sistema, the company
was viewed as a bona fide buyer of this stake and was able to sue
the seller of this stake for damages.  Sistema's status of a bona
fide buyer suggests that any further claims against it are
unlikely, including for returning dividends received from
Bashneft.

Although the litigation against the company's chairman has not
been dropped, he was released from home arrest.  An on-going
investigation against him is not directly connected to Sistema.

Loss of Bashneft is Contained

The loss of Bashneft had only a limited negative impact on
Sistema's credit profile.  The company has been able to
compensate for the loss of dividends by removing Bashneft's debt
from the group balance sheet, reducing its off-balance
liabilities and by implementing cost-cutting measures.  Overall,
the ownership of Bashneft was accretive for Sistema -- the
company received around RUB190 billion of dividends from this
subsidiary in 2009-2014 compared with paying approximately RUB84
billion for this asset.

Reliable Dividend Flow From MTS

Fitch expects MTS's operating and financial performance to remain
strong in the downturn supporting its ability to pay large
dividends.  Sistema can effectively control the cash flows of MTS
and shape its dividend policy.  MTS's leverage is moderate,
estimated by Fitch at 1.3x net debt/EBITDA and 1.9x FFO adjusted
net leverage without the potential positive impact of hedging and
assuming RUB21 billion of restricted cash at end-2014.

MTS can potentially increase its leverage to up to 3x FFO
adjusted net leverage without jeopardizing its rating.  Such an
increase could release up to RUB170 billion for dividends, which
would be sufficient to address any debt repayment issues at
Sistema.

More Cautious Strategy

Fitch understands Sistema is likely to become more disciplined
with acquisitions, leading to lower M&A risks.  The focus of its
strategy would likely change from asset diversification to cost
cutting and debt management, at least in the medium term.  In
line with its earlier announced approach, the holdco does not
have much appetite for providing support to its weak subsidiaries
and they are expected to become fully self-funded.

Shyam Remains a Cash Burner

Sistema Shyam TeleServices (Shyam), Sistema's Indian loss-making
Indian subsidiary, continues to depend on parental funding.
However, it is pursuing a much less ambitious operating strategy
primarily targeting a niche data market, and is likely to
substantially reduce its negative EBITDA generation over the next
two years.  Sistema is likely to reduce its funding to a minimum
level that would only be sufficient to keep this subsidiary
afloat and not to compromise its valuations.

Lower But Sizeable Off-Balance Sheet Liabilities

Fitch expects that Sistema will be able to reduce its off-balance
liabilities, primarily by turning its technology subsidiary RTI
into a sustainably self-funded business and repaying its Sistema-
guaranteed legacy debt.  The holdco's exposure to Shyam will take
longer to resolve and will continue to weigh on the company's
creditworthiness.

Sistema guarantees virtually all of Shyam's debt, which was
reported at USD595m at end-3Q14.  In addition, the Russian
government may exercise its put option on an equity stake in
Shyam against Sistema.  Fitch estimates the value of this put,
which becomes exercisable from March 2016, at USD777 million.

Sufficient Short-Term Liquidity

Sistema has sufficient liquidity to cover its debt maturities in
the form of a substantial cash cushion of USD1,139 million
reported at end-3Q14 and available untapped facilities from large
domestic banks.  Fitch believes that Sistema will likely have to
explore additional funding options if the government decides to
exercise its Shyam put option in 2016.

Key Assumptions:

   -- Stable dividends from MTS in the range of RUB40bn-RUB50bn
      per annum.
   -- Modest dividends from other subsidiaries.
   -- No significant acquisitions or divestments.
   -- Rising interest payments as legacy cheaper debt is replaced
      with currently more expensive facilities.
   -- No new off-balance sheet liabilities.
   -- No new financial support for subsidiaries other than for
      Shyam.
   -- Gradually declining EBITDA losses at Shyam.

RATING SENSITIVITIES

A reduction in off-balance-sheet liabilities and sustained
deleveraging at the holdco level to below 2.5x net debt including
off-balance-sheet liabilities to normalized dividends may be
positive for Sistema's rating.  This is likely to be achieved
through limiting Sistema's exposure to further losses and debt
increases at Shyam and re-organization of the technology segment
so that it becomes capable of sustainably servicing its debt
without parental support.

A protracted rise in this metric to above 4.5x may lead to
negative rating action.  A portfolio reshuffle increasing the
share of subsidiaries with low credit profiles could also be
rating negative.

Full List of Rating Actions

  Long-Term IDR: affirmed at 'BB-'; off RWN; Outlook Stable
  Local currency Long-Term IDR: affirmed at 'BB-; off RWN;
   Outlook Stable
  National Long-Term Rating: affirmed at 'A+(rus)' ; off RWN;
   Outlook Stable
  Senior unsecured debt: affirmed at 'BB-' foreign and local
   currency, 'A+(rus)' ; off RWN
  Loan Participation Notes issued by Sistema Funding S.A. and
   guaranteed by Sistema: affirmed at 'BB-'; off RWN



=========
S P A I N
=========


AUTOVIA DE LA MANCHA: Moody's Lifts Rating on EUR110MM Loan to B1
-----------------------------------------------------------------
Moody's Investors Service upgraded the underlying rating to B1
from B2 of the EUR110 million guaranteed senior secured loan, due
2031 raised by Autovia de la Mancha S.A.   The outlook remains
positive.  The rating on the loan, taking into account the
benefit of a guarantee of scheduled payments of principal and
interest provided by Assured Guaranty (Europe) Ltd. (A2 stable,
the Insured Rating), is unchanged at A2.

Aumancha is a special purpose company that in June 2003 entered
into a 30-year concession agreement with Junta de Comunidades,
Castilla-La Mancha (Castilla-La Mancha, Ba2 positive) to build,
operate and maintain a 52.3 km shadow toll road, the Toledo to
Consuegra section of the Autovia de los Vinedos motorway linking
the cities of Toledo and Tomelloso in central Spain.

"The upgrade reflects the positive impact on Aumancha's financial
metrics of a significant increase in its traffic volumes in 2014,
following three consecutive years of decline" says Declan
O'Brien, an Analyst in Moody's Infrastructure Finance Group.

The B1 rating on the underlying loan is constrained by (1) the
credit quality of Castilla-La Mancha as payer under the
concession agreement; and (2) the history of late payments by
Castilla-La Mancha, to the detriment of Aumancha's capacity to
meet debt service payments, although the recent payment history
has been in line with contractual terms.  However, these risks
are mitigated by the improving traffic profile, Aumancha's
satisfactory debt service coverage ratios (DSCRs) even under
downside traffic cases, and its strong liquidity which would
allow the project to withstand more than 12 months of payment
delays.  Moody's also note the protection afforded to Aumancha by
the compensation on termination regime in the event of a default
under the concession agreement.

In 2014, traffic on the project road grew for the first time
since 2010 with an increase in light vehicles (LV) and heavy
vehicles (HV) of 4% and 5.9%, respectively. Between 2011-2013,
LVs and HVs fell by 3.9% and 8.4% per annum, respectively.  The
rating agency notes that the impact of higher than expected
traffic growth is partially offset by lower than expected
inflation as Aumancha's tariffs are indexed to the Spanish
consumer price index (CPI).  The minimum and average DSCRs under
Moody's Base Case, which assumes an increase in LVs and HVs of 2%
from 2015-20 and 1.5% thereafter, are 1.09x and 1.53x,
respectively.  The minimum DSCR occurs in 2030; excluding this
period the minimum DSCR is 1.21x.  Furthermore Moody's Base Case
assumes the rating agency's assumptions for Spanish inflation.

Moody's could consider upgrading the underlying rating if (1) the
rating of Castilla-La Mancha is upgraded; and (2) Aumancha's
traffic and DSCR profile continues to improve in line with
Moody's Base Case and there are no ongoing payment delays.
Conversely, Moody's could consider downgrading the ratings if (1)
there is a decline in traffic such that DSCRs deteriorate and the
project experiences further payment delays; (2) operating,
maintenance and lifecycle cost assumptions were to prove
inadequate; or (3) the rating of Castilla-La Mancha is
downgraded.

The principal methodology used in this rating was Privately
Managed Toll Roads published in May 2014.


AUTOVIA DE LOS VINEDOS: Moody's Affirms Caa1 Rating on EIB Loan
---------------------------------------------------------------
Moody's Investors Service changed the outlook to positive from
negative and affirmed the Caa1 rating on the EUR103 million
European Investment Bank loan facility due 2030 (the "EIB Loan"),
and the EUR64.1 million bonds due 2027, both raised by Autovia de
los Vinedos S.A ("Auvisa") in October 2004.  The EIB Loan and
Bonds rank pari passu senior secured, and benefit from
unconditional and irrevocable guarantees of scheduled principal
and interest under financial guarantee insurance policies issued
by Syncora Guarantee (U.K.) Ltd (SGUK, not rated).

Auvisa is a special purpose company which in December 2003,
entered into a 30-year concession agreement with Junta de
Comunidades Castilla-La Mancha (Ba2, positive ) to build, operate
and maintain a 74.5km shadow toll road being the Consuegra to
Tomelloso section of the Autovia de los Vinedos motorway linking
the cities of Toledo and Tomelloso in central Spain.

"The rating action reflects the positive impact on Auvisa's
financial metrics of a significant increase in its traffic
volumes in 2014, following three consecutive years of decline"
says Declan O'Brien, an Analyst in Moody's Infrastructure Finance
Group.

The positive outlook reflects the company's improving traffic
volumes in 2014 for light and heavy vehicles which increased by
3.9% and 7.5%, respectively, and Moody's view that traffic
volumes will continue to grow albeit at a slower pace than in
2014.

The Caa1 ratings are constrained by (1) Auvisa's weak financial
metrics compared to peers; (2) the credit quality of Castilla-La
Mancha as payer under the concession agreement; (3) the history
of late payments by Castilla-La Mancha, to the detriment of
Auvisa's capacity to meet debt service payments, although the
recent payment history has been in line with contractual terms;
(4) the ineffectiveness of the lock-up mechanism in protecting
debt holders under downside scenarios; (5) high leverage; and (6)
Auvisa's exposure to low inflation as its revenues are linked to
the Spanish consumer price index (CPI). These risks are to some
extent mitigated by Auvisa's good liquidity and Moody's also
notes the protection afforded by the compensation on termination
regime in the event of a default under the concession agreement.

The rating agency has run a scenario ("Moody's Case") whereby it
assumes an increase in traffic of 2% per annum for light and
heavy vehicles to 2020 and 1.5% growth per annum thereafter.
Furthermore the case assumes Moody's assumptions for Spanish
inflation. Under Moody's Case, Auvisa's minimum and average DSCR,
which are different from Auvisa's DSCRs in that they include
transfers to the maintenance reserve account (MRA), are 0.81x and
1.10x, respectively. Auvisa would be able to continue to pay
principal and interest using its debt service reserve account
under this scenario.

As per the financing documents, Auvisa's DSCR calculation
includes transfers from, but not to, the MRA. This means that
there is a material difference between Moody's DSCR and Auvisa's
DSCR -- under Moody's Case, above, Auvisa's forecast minimum and
average DSCRs of 1.24x and 1.34x, respectively, significantly
higher than Moody's forecast. The distribution lock-up criteria
allow for dividends to be paid if the projected DSCR and
historical DSCR are greater than 1.2x. Under Moody's Case, Auvisa
satisfies these criteria from 2020 onwards. While the EIB and
SGUK as controlling creditors can block a dividend payment, this
covenant is weakly drafted, and Moody's views this as a material
weakness in the structure.

Moody's could consider upgrading the ratings if Auvisa's traffic
and DSCR profile continues to improve in line with Moody's Case
and there are no ongoing payment delays. Conversely, Moody's
could consider downgrading the ratings if (1) there is a decline
in traffic such that DSCRs deteriorate and/or the project
experiences further payment delays; (2) operating, maintenance
and lifecycle cost assumptions were to prove inadequate; or (3)
the rating of Castilla-La Mancha is downgraded.

The principal methodology used in this rating was Privately
Managed Toll Roads published in May 2014.


BANCO DE MADRID: May Face Liquidation After Bail-out Ruled Out
--------------------------------------------------------------
David Roman at The Wall Street Journal reports that Banco de
Madrid SA won't be bailed out by Spain's government and will
likely be liquidated.

In a statement released late on March 18, the government-
controlled bailout fund FROB said it wouldn't try to keep Banco
de Madrid afloat, the Journal relates.

The FROB didn't say what would happen to the bank next, but
without the fund's support it will likely be liquidated, the
Journal notes.

In a separate statement, the country's fund in charge of
guaranteeing bank deposits said that, in accordance with Spanish
law, Banco de Madrid clients will each have up to EUR100,000 of
losses covered, the Journal relays.  Any claims above that figure
will be resolved after the lender's liquidation, the Journal
states.

As reported by the Troubled Company Reporter-Europe on March 18,
2015, The Wall Street Journal reported that Spain's central bank
on March 16 said Banco de Madrid SA, the Spanish unit of an
Andorran lender accused of laundering money for organized-crime
groups, has filed for protection from its creditors.  Banco de
Madrid has been hit by substantial client withdrawals, the
central bank, as cited by the Journal, said, which has impacted
the ability of the lender to "meet its obligations in a timely
matter."  The move comes less than a week after the Bank of Spain
hastily took control of the tiny Madrid-based private banking
unit, after The Treasury Department's Financial Crimes
Enforcement Network named Banco de Madrid's parent company-Banca
Privada d'Andorra, or BPA -- a "primary money-laundering
concern", the Journal disclosed.

Banco de Madrid is a small bank in Spain's banking sector.  The
lender had 15,000 clients and 21 offices in major cities such as
Madrid and Barcelona as of March 11.


TP FERRO: Fails to Reach Refinancing Agreement with Creditors
-------------------------------------------------------------
Luca Casiraghi and Katie Linsell at Bloomberg News report that
Eiffage, co-owner of TP Ferro, said TP Ferro failed to reach
refinancing agreement with its creditors, the French and Spanish
governments.

According to Bloomberg, the company's debt is due March 31.

The preliminary creditor protection will allow the company to
continue talks with its lenders for four months, Bloomberg notes.

TP Ferro is the Concessionaire for the new high-speed (HS)
railway line between Spain and France.



===========
T U R K E Y
===========


ARCELIK AS: Fitch Affirms 'BB+' Issuer Default Rating
-----------------------------------------------------
Fitch Ratings has affirmed Arcelik A.S.'s (Arcelik) Long-term
foreign and local currency Issuer Default Ratings (IDR) at 'BB+'
and National Long-term rating at 'AA(tur)'.  The Outlooks are
Stable.  Fitch has also affirmed Arcelik's senior unsecured
rating at BB+.

KEY RATING DRIVERS

Stable Financial Performance, Weak Free Cash Flow

Arcelik's 2014 financial results were broadly stable and within
Fitch's expectations.  The recent slowdown in the domestic
economy continued to be balanced by international revenue growth,
backed by market share gains and recent deterioration of the
Turkish lira.  Organic growth was higher than expected in both
domestic and international markets with 5% organic growth vs a
13% reported growth.  Free cash flow (FCF) remained negative due
to elevated working capital (WC) needs.  Fitch expects muted
growth in the medium term as the domestic economy continues to be
under pressure during the pre-election period, further sharp FX
movements, and EBITDA margins to be in line with historical
averages.

High Working Capital Needs

Arcelik has a high working capital to sales ratio due to the
Turkish market practice of manufacturers financing a portion of
customer purchases.  WC needs improved to 36% of sales as of
FYE2014 vs 39% in 2013, having been negatively affected by the
lira devaluation and muted growth in the Turkish economy.  Fitch
does not forecast major unwinding in WC needs in the medium term.
Until consumer confidence and consumption levels return to
normalized levels, Fitch believes that the extent of cash outflow
will depend on inventory and receivables management.  Effective
WC management remains key to Arcelik achieving positive FCF
generation.

Strong Growth in International Markets

Arcelik has achieved strong top line growth in the past years
outside Turkey, taking advantage of more price-conscious
consumers in Western Europe as well as its previous marketing and
distribution network expansion efforts.  Further growth in
developed markets in the short to medium term is likely as the
company continues to capitalize on its present momentum and
current market trends, although this may place pressure on
profitability as Fitch believes that margins in international
markets tend to be lower than Turkey.

Fitch believes that recent investment/expansion plans in the
ASEAN region is a positive step towards further geographic
diversification.  Targeting markets where appliance penetration
rates are lower than the rest of the world could also support
strong revenue growth.  The new refrigeration plant is expected
to bring USD500 million of extra revenues in the medium term and
is likely to provide the first footprint for additional export
opportunities in the region.  However, Arcelik's exposure to
emerging markets is higher than its close peers, which might lead
to more vulnerability to FX movements, political risks and
volatile macroeconomic conditions.

Stable Adjusted Leverage

Arcelik's reported leverage is negatively affected by its higher
than average working capital needs, as a significant portion of
durable goods are sold on credit in Turkey.  While this is partly
financed by Arcelik, the consumer credit risk is covered by bank
letters of credit.  Fitch assumes approximately 120 days of
domestic receivables comes from this business practice in Turkey
and adjusts debt accordingly to reflect a more accurate peer
comparison.  On this basis, Arcelik's FFO-adjusted net leverage
was 1.4x at end 2014 (from 1.2x at end 2013).  Fitch expects
slower deleveraging in the next two years until the political
risk subsidies.  However, Fitch still forecasts FFO adjusted net
leverage slightly below 1.5x, supporting the rating.

Improved Debt Maturity Profile and Diversification

Taking advantage of the historically low interest rates, Arcelik
has been diversifying its funding base in the past two years with
the issuance of USD500 million 2023 and EUR350 million 2021
eurobonds.  The issuances have improved Arcelik's debt maturity
profile to approximately 4.5 years from less than two years in
2012.  Fitch believes that diversifying the funding base away
from short-term bank financing practices in Turkey is credit
positive.  Also, both Eurobonds are senior unsecured and have
fixed interest rates, providing security for potential increase
in interest rates in Turkey, and international markets in
general.

Increased Macroeconomic Risks

Fitch believes that a prolonged decline in currency along with
other domestic shocks from country's political crisis poses a
risk for Turkish corporate ratings in general.  Arcelik's FX
exposure is balanced by its robust export revenues and hedging,
but it is still vulnerable to higher than expected slowdown in
domestic market and any cost increases that could result from
lira devaluation

KEY ASSUMPTIONS

Fitch's key assumptions within our rating case for the issuer
include:

   -- Muted organic growth environment both in domestic and
      European markets until 2016.

   -- Revenues to be driven by greenfield investments and organic
      growth with no M&A forecasted.

   -- Stable profitability margins in line with historical
      averages, negative headwinds from FX movements to be
      balanced out by decreasing raw material prices.

   -- Further cash outflows from WC in line with revenue growth.

   -- Capital expenditures broadly in line with historical
      levels.

RATING SENSITIVITIES

Taking into account Arcelik's large cash position on its balance
sheet, Fitch has changed its leverage sensitivities from
receivable adjusted FFO gross leverage to available cash adjusted
net FFO leverage.

Positive: Future developments that could lead to positive rating
actions include:

   -- Receivable-adjusted FFO net leverage ratio below 1.5x.
   -- FFO margins consistently above 10%.
   -- FCF margin above 2% on a sustainable basis.

Negative: Future developments that could lead to negative rating
action include:

   -- Receivable-adjusted FFO net leverage ratio above 2.5x.
   -- FFO margin below 8%.
   -- Consistently negative FCF.



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


CITY LINK: Former Employees Could Recover 'Thousands'
----------------------------------------------------
Warrington Guardian reports that employment lawyers are battling
to gain compensation for 25 former City Link employees, who were
based at the town's Appleton depot, over the company's 'failure
to properly consult.'

JMW Solicitors has lodged a claim on behalf of more than 241
people after the firm went into administration on Christmas Eve
with the closure of 51 depots and the loss of over 2,500 jobs,
according to Warrington Guardian.

The report notes that a total of 113 people were affected at the
parcel delivery company's Appleton base, which has proved to be
one of the highest uptakes for JMW, and those yet to make a claim
have until Friday to put their case forward.

JMW has until March 16, to look at any new cases, after which a
group action will be made on behalf of all the former employees
to get in touch, the report relays.

"Time is running out now for any ex-City Link employees who
haven't yet joined the action to claim up to eight weeks
additional pay even if they have already received redundancy or
notice pay," the report quoted Carl Moran, partner in employment
law at JMW, as saying.

"JMW have confirmed that there is an additional award available
to all redundant City Link employees even if they did not qualify
for a redundancy payment," Mr. Moran, the report notes.

"This award is in addition to any redundancy or notice payment
they may already have received and should be up to a maximum of a
further 8 weeks' pay which should amount to several thousands of
pounds.  We are still getting ex-employees contacting us and we
would encourage as many as possible to come forward before the
deadline," Mr. Moran said, the report relays.

The company has been unable to provide the amount payable for
each individual to cover legal costs but former employee, Simon
Jones, who worked at the Warrington branch for more than 10
years, admits the financial commitment has him unable to make a
claim with JMW, the report discloses.

The report relays that the 26-year-old added: "It is not for me
as it is costing a lot of money and there is no guarantee that
they will win.  But it is important that we get compensation as
we got paid peanuts and in today's world it is not easy for us
all to get jobs."

However, JMW insist a number of funding options, including no
win, no fee, are being made available, the report discloses.

A spokesman confirmed the amount recovered will depend on how the
case processes but it may be several months before the final
hearing will take place, the report relays.

Former employees can make a claim no matter how long they had
been employed by City Link, the report adds.


KARDEN PIPEWORK: In Administration, Ceases Trading
--------------------------------------------------
Insider Media Limited reports that Karden Pipework has ceased to
trade with buyers now being sought for its assets after
administrators decided the business could not be sold as a going
concern.

Paul Addison -- paul.addison@pkfcooperparry.com -- and Tyrone
Courtman -- tyrone.courtman@pkfcooperparry.com -- of PKF Cooper
Parry were appointed joint administrators of Karden Pipework on
March 3, 2015.

"Unfortunately, upon appointment we saw that it was clear the
business could not be sold as a going concern, so we took steps
to close the business down immediately," the report quoted Mr.
Addison as saying.

"However, we endeavored to retain a small number of staff members
to help with the orderly wind down of the business in the short
term. The assets of the business will now be put up for sale for
the benefit of the company's creditors," Mr. Addison added.

Karden Pipework is a Scunthorpe-based pipework specialist.
The business specialized in the manufacturing, installation and
servicing of industrial pipework and associated steel work for
many different sectors, and at the time of going into
administration, had 18 full-time members of staff.


LABUTE: Calls In Administration, Ceases Trading
-----------------------------------------------
Print Week reports that Cambridge-based commercial printer Labute
has fallen into administration following increased financial
pressure, resulting in the loss of 18 jobs.

Tony Wright -- tony.wright@frpadvisory.com -- and Philip Watkins
-- Philip.watskins@frpadvisory.com -- from FRP Advisory were
appointed joint administrators of the business on March 3, 2015,
and the business ceased trading immediately, according to Print
Week.

"It is hugely regrettable that a company with a loyal customer
base and nearly 40 years trading history has had to close its
doors.  The company had been competing in a market that has been
in chronic decline since the advent of online publishing.
Despite best efforts to find a viable solution for the business,
the joint administrators were forced to make all staff redundant
on March 3, 2015 and cease trading the business," the report
quoted Joint administrator Wright as saying.

"As joint administrators, our primary focus will be to ensure
that staff have been provided with the necessary support to make
timely claims from the Redundancy Payments Service.  We will
continue to market the assets of the businesses to realise all
that is possible in the interests of creditors," Joint
administrator Wright said.

The joint administrators have had to cease trading the business
as a going concern and have appointed valuers at Hilco Global to
assist with the sale of assets, the report notes.  The sale will
take place from March 18 to March 25 with a site viewing and
online auction due to take place on March 24-25, the report
relates.

Labute, which was founded in 1978 and based at the Cambridge
Printing Park in Milton, produced items including brochures,
business cards, leaflets, magazines, posters, stationery and
large-format graphics.  It's wholly owned trading subsidiary The
Copy Centre was the first full-color copying service in the UK.


MUIRFIELD CONTRACTS: Contractors Offer Lifeline to Former Staff
---------------------------------------------------------------
Construction Enquirer reports that local contractors have
rallied-round to help find new jobs for workers hit by the
collapse of Dundee contractor Muirfield Contracts.

More than 100 ex-Muirfield staff attended an event organized by
local government agencies in the wake of the company's fall into
administration last week with the loss of 258 jobs, according to
Construction Enquirer.

The Enquirer understands that BAM, Robertson and Havelock Europa
were among contractors offering opportunities for Muirfield
staff.

BAM is main contractor on Dundee's GBP80 million V&A museum of
design job which got underway earlier this month, the report
relates.

The report discloses that a spokeswoman for event organizer
Skills Development Scotland said: "It has been great the way
other contractors have come forward so quickly to try and help.
This event was organized within days and firms wanted to get
involved straight away to try and help."


SCOTLAND: Fans Can Buy Football Clubs to be Considered
------------------------------------------------------
stv News reports that proposals to allow fans the right to buy
their football clubs will be considered by a Holyrood committee.

Green MSP Alison Johnstone has put forward amendments to the
Community Empowerment Bill which will be considered by the Local
Government Committee, according to stv News.

The report notes that the Bill sets out plans to expand community
right-to-buy to public sector land and buildings, and the Greens
want the bill to be extended to include clubs' membership shares.

Ms. Johnstone said the current model of ownership has led to
disaster for several clubs, the report relates.

A survey by the Greens received more than 250 replies from
football supporters and members of fans' trusts, with the
majority backing the proposals, the report relays.

More than 95% supported giving fans the first right of refusal if
their clubs are sold or go into administration, and 81% of those
expressed a view backed a right to buy at any time.

Ms. Johnstone already has Labor and Liberal Democrat support for
the amendments, the report discloses.

"You don't need to be a football fan to know that Scottish
football lurches from crisis to crisis, and that the current
model of ownership has led to disaster at clubs from Gretna to
Hearts.  You also only need to look at Germany, where almost all
clubs are fan-owned, to see how well this model can work," the
report quoted Ms. Johnstone as saying.

"But it's not just about fans stepping in to save their clubs
once they've fallen into administration.  There are many well-run
Scottish clubs in private hands, but those owners come and go,
and when they go, we want to see fans have the first right of
refusal," Ms. Johnstone said, the report relates.

"Where there's a committed and well-organised group of fans with
strong support on the terraces for a takeover, we want them to
have the power to do so," Ms. Johnstone added.


TYNEMOUTH PUB: Assets Acquired After Administration
---------------------------------------------------
Insider Media Limited reports that the assets of Tynemouth Pub Co
Ltd, the company behind a large Tynemouth hotspot, have been
acquired after it fell into administration.

Tynemouth Pub Co Ltd, which trades as Lorelei Bar & Sea Grill,
entered administration on February 26, 2015.

Steven Philip Ross and Ian William Kings of Baker Tilly were
appointed as joint administrators before it was sold to an
unnamed third party.

The administrators said the acquisition provided "ongoing
employment for the remaining workforce," according to Insider
Media Limited.

The report notes that the establishment describes itself as "a
beautiful steak and seafood grill set in the heart of Tynemouth,
boasting a fabulous array of seafood and a wonderful steaks to
match".

"The downstairs cocktail lounge has an extensive list of classic
cocktails, some with a Lorelei twist," it adds, the report
relays.


UROPA SECURITIES 2008-1: S&P Affirms 'BB-' Rating on Cl. C Notes
----------------------------------------------------------------
Standard & Poor's Ratings Services raised its credit ratings on
the class M1, M2, and B notes in Uropa Securities PLC's series
2008-1.  At the same time, S&P has affirmed its ratings on the
class A and C notes.

The rating actions follow S&P's credit and cash flow analysis
under its U.K. residential mortgage-backed securities (RMBS)
criteria and its current counterparty criteria.

S&P has also considered the amendments made to the downgrade
language incorporated in the swap documents in April 2013, which
have not been affected by S&P's Feb. 3, 2015 CreditWatch negative
placement of its long-term issuer credit rating (ICR) on the swap
provider, The Royal Bank of Scotland PLC (A-/Watch Neg/A-2).

In the portfolio of assets backing this transaction, arrears have
been stable and losses have been decreasing since 2009.  Arrears
are below S&P's U.K. RMBS index but following the same trend.  To
consider the possibility of a further deterioration in asset
performance, S&P has applied more stressful arrears as part of
its credit stability analysis, under which the ratings do not
deteriorate below the levels stated in S&P's criteria.

Taking into account the U.K.'s improving economy, and the high
proportion of interest-only loans backing the transaction, the
asset principal pay-down has remained low, and therefore the
pool's characteristics have not significantly changed since S&P's
June 7, 2012 review.  However, the weighted-average seasoning
increased to 91 months in December 2014 from 60 months in March
2012.  Under S&P's U.K. RMBS criteria, this improves the credit
quality of the assets.

Following the application of S&P's U.K. RMBS criteria, it has
observed that overall, the minimum credit support requirement for
all rating levels has decreased because of the increased
seasoning since S&P's previous review.  The transaction can use
the liquidity reserve fund (GBP33.38 million) and excess spread
to pay interest on the class A, M1, M2, and B notes if needed.
The transaction documents state that the liquidity reserve can be
used to pay interest on the class C notes only after the class A,
M1, M2, and B notes have amortized.

The amended downgrade language in the swap documentation does not
comply with S&P's current counterparty criteria.  Therefore,
under S&P's criteria, its ratings on the class A, M1, M2, and B
notes are not linked to S&P's long-term ICR on the swap
counterparty, The Royal Bank of Scotland.  In S&P's opinion, the
rating actions on the class A, M1, M2, and B notes can be
achieved even without the benefit of the swap counterparty in
S&P's analysis.

S&P has raised its ratings on the class M1, M2, and B notes as
its credit and cash flow results are commensurate with higher
ratings than those currently assigned, even without giving credit
to the swap counterparty.

S&P has affirmed its 'AAA (sf)' and 'BB- (sf)' ratings on the
class A and C notes, respectively.  S&P considers these rating
levels to be in line with its credit and cash flow results,
following the application of S&P's U.K. RMBS criteria.  S&P rates
the class C notes based on the ultimate payment of both interest
and principal.

Uropa Securities' series 2008-1 closed in December 2008 and is
backed by a pool of U.K. nonconforming residential mortgages
originated by GMAC Residential Funding Co. LLC, Kensington
Mortgage Co. Ltd., Money Partners Ltd., Edeus Mortgages Ltd., and
Platform Funding Ltd.

RATINGS LIST

Class      Rating              Rating
           To                  From

Uropa Securities PLC
GBP446.628 Million Mortgage-Backed Floating-Rate Notes
Series 2008-1

Ratings Raised

M1         AA+ (sf)             AA (sf)
M2         AA- (sf)             A+ (sf)
B          A- (sf)              BBB+ (sf)

Ratings Affirmed

A          AAA (sf)
C          BB- (sf)



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


* BOOK REVIEW: Oil Business in Latin America: The Early Years
-------------------------------------------------------------
Author: John D. Wirth Ed.
Publisher: Beard Books
Softcover: 282 pages
List price: $34.95
Review by Gail Owens Hoelscher
Buy a copy for yourself and one for a colleague on-line at
http://is.gd/DvFouR

This book grew out of a 1981 meeting of the American Historical
Society. It highlights the origin and evolution of the stateowned
petroleum companies in Argentina, Mexico, Brazil, and
Venezuela.

Argentina was the first country ever to nationalize its
petroleum industry, and soon it was the norm worldwide, with the
notable exception of the United States. John Wirth calls this
phenomenon "perhaps in our century the oldest and most
celebrated of confrontations between powerful private entities
and the state."

The book consists of five case studies and a conclusion, as
follows:

* Jersey Standard and the Politics of Latin American Oil
Production, 1911-30 (Jonathan C. Brown)
* YPF: The Formative Years of Latin America's Pioneer State
Oil Company, 1922-39 (Carl E. Solberg)
* Setting the Brazilian Agenda, 1936-39 (John Wirth)
* Pemex: The Trajectory of National Oil Policy (Esperanza
Duran)
* The Politics of Energy in Venezuela (Edwin Lieuwen)
* The State Companies: A Public Policy Perspective (Alfred
H. Saulniers)

The authors assess the conditions at the time they were writing,
and relate them back to the critical formative years for each of
the companies under review. They also examine the four
interconnecting roles of a state-run oil industry and
distinguish them from those of a private company. First, is the
entrepreneurial role of control, management, and exploitation of
a nation's oil resources. Second, is production for the private
industrial sector at attractive prices. Third, is the
integration of plans for military, financial, and development
programs into the overall industrial policy planning process.
Finally, in some countries is the promotion of social
development by subsidizing energy for consumers and by promoting
the government's ideas of social and labor policy and labor
relations.

The author's approach is "conceptual and policy oriented rather
than narrative," but they provide a fascinating look at the
politics and development of the region. Mr. Brown provides a
concise history of the early years of the Standard Oil group and
the effects of its 1911 dissolution on its Latin American
operations, as well as power struggles with competitors and
governments that eventually nationalized most of its activities.
Mr. Solberg covers the many years of internal conflict over oil
policy in Argentina and YPF's lack of monopoly control over all
sectors of the oil industry. Mr. Wirth describes the politics
and individuals behind the privatization of Brazil's oil
industry leading to the creation of Petrobras in 1953. Mr. Duran
notes the wrangling between provinces and central government in
the evolution of Pemex, and in other Latin American countries.

Mr. Lieuwin discusses the mixed blessing that oil has proven for
Venezuela., creating a lopsided economy dependent on the ups and
downs of international markets. Mr. Saunders concludes that many
of the then-current problems of the state oil companies were
rooted in their early and checkered histories." Indeed, he says,
"the problems of the past have endured not because the public
petroleum companies behaved like the public enterprises they
are; they have endured because governments, as public owners,
have abdicated their responsibilities to the companies."

Jonh D. Wirth is Gildred Professor of Latin American Studies at
Standford University.


                            *********

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 Amazon.com.  Go to
http://www.bankrupt.com/booksto order any title today.


                            *********


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

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

Copyright 2015.  All rights reserved.  ISSN 1529-2754.

This material is copyrighted and any commercial use, resale or
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re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.

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

The TCR Europe subscription rate is US$775 per half-year,
delivered via e-mail.  Additional e-mail subscriptions for
members of the same firm for the term of the initial subscription
or balance thereof are US$25 each.  For subscription information,
contact Peter Chapman at 215-945-7000 or Nina Novak at
202-362-8552.


                 * * * End of Transmission * * *