TCREUR_Public/160303.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

          Thursday, March 3, 2016, Vol. 17, No. 044



AZERENERJI JSC: Fitch Cuts LT Issuer Default Rating to 'BB+'


NOKIA CORP: Fitch Hikes LT Issuer Default Rating Rating to 'BB+'


MAPLE BANK: March 10 Hearing on Bid for Recognition in U.S.
MAUSER HOLDING: Moody's Assigns (P)B2 Rating to EUR100MM Loan


KEG: Enters Into Sale & Rent Back Agreement with Creditors
MFB HUNGARIAN DEV'T: Fitch Affirms 'BB+' Issuer Default Ratings


VENETO BANCA: S&P Lowers Counterparty Credit Rating to 'B'


GATEWAY IV - EURO: S&P Affirms BB+p Ratings on 2 Note Classes
INTELSAT SA: S&P Lowers CCR to 'CCC', Outlook Negative
MAUSER HOLDING: S&P Affirms 'B' CCR, Outlook Stable


CADOGAN SQUARE: Moody's Raises Rating on Class E Notes to Ba3
INTERGEN NV: Moody's Affirms B1 Rating on Sr. Secured Loan


HAVILA SHIPPING: Misses Interest Payment to Bondholders
NORSKE SKOGINDUSTRIER: BlueCrest Says Won't Profit From Default


BORETS INTERNATIONAL: S&P Puts 'BB-' CCR on CreditWatch Negative
KOKS OAO: S&P Lowers Long-Term Corporate Credit Rating to 'B-'


ABENGOA SA: Replaces Chairman, Ends Shareholder Contract


CLARIANT AG: Moody's Affirms Ba1 CFR & Changes Outlook to Neg.

U N I T E D   K I N G D O M

EASTERN CONTINENTAL: Insolvency Proceedings Recognized in U.S.
EUROHOME UK: Fitch Hikes Class B1 Debt Rating to 'Bsf'
GEMINI PLC: Moody's Affirms Ca Rating on Class A Notes
NELSON PACKAGING: In Administration, 40 Jobs Affected
PRESBYTERIAN MUTUAL: Moore Stephens Faces Fine Over Audit

TULLOW OIL: Moody's Confirms B2 CFR, Outlook Negative



AZERENERJI JSC: Fitch Cuts LT Issuer Default Rating to 'BB+'
Fitch Ratings has downgraded Azerbaijan-based utilities company
JSC Azerenerji's (Azerenerji) Long-term Issuer Default Rating
(IDR) to 'BB+' from 'BBB-' and Short-term IDR to 'B' from 'F3'.
The Outlook is Negative.

The downgrade of Azerenerji's rating reflects the downgrade of
the Republic of Azerbaijan's Long-term foreign currency IDR to
'BB+' from 'BBB-'.

Azerenerji's ratings are aligned with the Republic of Azerbaijan,
reflecting the company's strong legal, strategic and operational
ties with the state. All of the company's outstanding debt at
end-2015 was guaranteed by the state.


State Guarantees Key

The rating alignment reflects state guarantees for all of
Azerenerji's outstanding debt at end-2015, the company's
strategic importance to the Azerbaijani economy, strong
operational links, including tariff and capex approval by the
government, as well as a track record of direct tangible state

State Support to Continue

Fitch assumes that the share of state-guaranteed debt will remain
fairly stable over 2016-2018 and we do not expect any significant
changes to the legal links with the state in the foreseeable
future as there are no plans at present to privatise Azerenerji.
The state has also continued to provide equity injections,
totalling AZN930m over 2009-2015, to partially fund its
investment programme (35% of total capex over this period). The
company expects to receive another AZN3.7billion over 2016-2019,
covering almost all of its investment needs.

Devaluation Drives Leverage Increase

The 50% Azerbaijan manat devaluation in December 2015 has further
weakened Azerenerji's standalone credit profile due to the
currency mismatch between the company's debt and revenues and
limited use of hedging to reduce exchange-rate risk exposure. At
end-2015, almost all of the company's outstanding debt was
denominated in foreign currencies, mainly in dollars, euros, and
Japanese yen while almost all of its revenue was based in local
currency. We expect the devaluation will increase Azerenerji's
gross leverage to around 20x over 2016-2018, other things being
equal, from 7.5x in 2014.

Given the already high leverage, Fitch expects Azerenerji to
receive state guarantees for any new debt in addition to equity
injections for specific investment projects.

Potential Covenant Breach
Fitch expects the forecasted deterioration of Azerenerji's
financials will lead to a continued breach of debt service
coverage ratio covenant set forth in the loan agreement with
Asian Development Bank (ADB). The covenant is currently set at
cash flow from operating activities/(repayments plus interest)
above 1.5x. Azerenerji is currently negotiating with ADB to waive
the covenant breach.

Near Monopoly Position

The strength of strategic ties is underpinned by Azerenerji's
virtual monopoly in Azerbaijan's electricity generation market
and transmission segment. This demonstrates the company's
importance to Azerbaijan's economy, despite a fairly low
contribution to the country's GDP.

Weakening Standalone Profile

Azerenerji's standalone profile has weakened, due to its
worsening financial performance and weak liquidity. Deteriorating
financial performance was mainly driven by an imbalanced tariff-
setting mechanism where substantial gas tariff increases have not
been matched by electricity tariff change, that pressured EBITDA
margin, and by manat devaluation, that resulted in debt increase.
However, we do not expect the worsening standalone profile to
affect the ratings unless the company faces unremedied liquidity


Fitch's key assumptions within its rating case for the issuer

-- Electricity volumes growth in line with Fitch's GDP forecasts
    of -3.3% to 1.5% over 2015-2018

-- Flat electricity and gas tariff growth over 2016-2018, ie
    continued tariff mismatch

-- Inflation-driven cost increase, which Fitch expects at about
    4%-14% over 2015-2018

-- No dividend payments

-- Capex of about AZN530m on average over 2015-2018, largely
    funded though new equity

-- Refinancing supported by the government

-- $US/AZN exchange rate of 1.6 over 2016-2018


Positive: Future developments that could, individually or
collectively, lead to positive rating actions include:

-- A positive sovereign rating action provided that the linkages
    between Azerenerji and the state remain strong.

Negative: Future developments that could, individually or
collectively, lead to a downgrade include:

-- A sovereign downgrade
-- Evidence of weakening state support, for example, in an
    unremedied liquidity squeeze.


The main factors that could, individually or collectively,
trigger negative rating action are:

-- A failure to adjust expenditure or revenue to the lower oil
    price environment, resulting in a more rapid draw-down of
    external assets.

-- A further fall in hydrocarbon prices, or a prolongation of
    the current price weakness.

The main factors that could, individually or collectively,
trigger positive rating action are:

-- An improvement in the budgetary position, beyond the measures
    currently envisaged, sufficient to increase Fitch's
    confidence in the longer-term sustainability of Azerbaijan's
    sovereign balance sheet strengths.

-- A sustained rise in hydrocarbon prices that restores fiscal
    and external buffers.

-- Improvements in governance and the business environment, and
    progress towards diversifying the economy away from


Fitch views Azerenerji's liquidity as weak and conditional on
continued tangible support from the government. At end-2015 cash
of AZN1.3m was insufficient to cover short-term debt of AZN326
million. Liquidity risk is somewhat mitigated by the state
guarantees on the company's outstanding debt.

Fitch expects Azerenerji's ambitious investment program, which
will result in negative free cash flow, to be largely funded by
new equity. This should partially free up operating cash flow for
the repayment of existing debt maturities.


NOKIA CORP: Fitch Hikes LT Issuer Default Rating Rating to 'BB+'
Fitch Ratings has upgraded Finland-based Nokia Corporation's
(Nokia) Long-term Issuer Default Rating (IDR) and senior
unsecured rating to 'BB+' from 'BB'. The Outlook on the IDR is

The upgrade reflects Nokia's improved operating profile following
its acquisition of Alcatel-Lucent, steady operational progress in
the company's core network and technologies division and
sustained 2015 financial performance at Alcatel-Lucent despite
the lengthy acquisition process. While integration risks remain,
Fitch believes these are manageable. Nokia has a strong balance
sheet position with a net cash position of EUR7.78 billion (end-
2015) that provides the company with flexibility for managing
cyclicality, sector risks and investments. We expect Nokia to
reduce debt by EUR3 billion in line with its capital structure
optimization program announced in October 2015.

The Positive Outlook reflects Fitch's view that the potential
extraction of acquisition synergies, further operational
improvements and a strengthening market position, combined with
greater visibility on cash generation, is likely to allow Nokia
to achieve a low investment grade rating in the medium-term.


Improved Operating Profile
The acquisition of Alcatel-Lucent has improved Nokia's medium- to
long-term operating and business risk profile as a result of
greater scale, expanded customer reach, R&D cost amortization,
greater innovation scope, a broader product portfolio and
potentially stronger margins through cost reduction. Fitch
believes that the combined entity will be better- positioned to
compete in a highly competitive, rapidly changing industry where
scale, innovation and customer reach are key to profitably, as
well as growing and maintaining market share.

The greater scale and broader product portfolio improve Nokia's
diversification and alleviate risks to its original strategy,
which was to focus on wireless infrastructure and services only.
A slowdown in the sale of 4G equipment as mobile operators
complete their LTE roll-out, greater convergence in fixed and
mobile networks and IP and cloud services could have otherwise
seen Nokia struggle in the long run.

Cost Reduction Potential
Nokia envisages that the Alcatel-Lucent acquisition will yield
annual operational cost savings of EUR900 million by 2018, a year
earlier than originally envisaged, with associated one-off
integration and restructuring costs of EUR900 million. Nokia
estimates that on a pro-forma basis, the reduced costs would
improve the 2014 margins of the combined entity to 12% from 8.7%.
The main areas of synergies include product and service overlap,
sales force optimization, supply chain and procurement and
overhead costs.

Sustained Execution and Integration
At end-2015 both Nokia and Alcatel-Lucent showed continued
improvements in operating margins and operating cash flows on the
back of restructuring and focus on more profitable segments and
geographies where both entities have capabilities to sustainably

However, a lack of pro-forma consolidated financial information,
potential integration risks and a track record of operating as a
combined entity, create a lack of visibility in cash flows at
this stage that result in a more cautious rating approach. Our
scenario analysis indicates that a combination of sustained
operational performance and extraction of integration synergies,
assuming no major cyclical downturns and changes in the sector
risk profile, is likely to see sustainable improvements in the
company's cash generation. Greater visibility on these elements
will be key to Nokia achieving an investment-grade rating.

Conservative Financial Policy
At end-2015, Nokia had a strong net cash position of EUR7.78
billion. Included within this are disposal proceeds of EUR2.56
billion from the sale of its mapping business HERE. Nokia has
announced a capital structure optimization program, which
includes EUR3 billion reduction of debt and debt-like items (of
which EUR1.87 billion was completed at end-February 2016), a
planned EUR 0.6 billion special dividend in 2016 with minimum
EUR0.9 billion dividends payable in 2016 and 2017 (assuming
approximately 6 billion shares outstanding) and a planned two-
year EUR 1.5billion share repurchase program.

Fitch expects that Nokia will continue to maintain a significant
net cash position given sector risks relating to technology
cycles and macro-cyclicality and a strong balance sheet
requirement for its contract tendering process.

Sector Backdrop
Fitch expects the size of the market in which Nokia competes to
remain broadly flat in the medium-term. This reflects declines in
wireless equipment sales as a result of a slowdown in geographic
4G network equipment build, offset by equipment sales growth in
4G capacity improvements, software and manged services, core
networking and fixed access.

The evolution of 5G services may provide a basis for growth in
the sector; however, the exact form of these services are not
visible as yet and they are likely to take at least three to five
years to materialize, as technology standards develop and mobile
operators aim to gain some return from 4G investments before
making scale investments in 5G.

The lack of growth in the sector over the medium-term will keep
competition intense, which is likely to exert pressure on prices
and margins, particularly for equipment sales. This makes
maintaining a strong R&D focus and growing the software and
services part of their portfolio key for telecoms equipment
manufacturers. This in turn raises the sector's risk profile with
R&D making a demand on cash flows while growing the software and
services portfolio will mean competing with well-established
global software service providers.

The sector is, however, key to the entire communications
ecosystem with market shares becoming increasingly concentrated
among few large players such as Huawei, Ericsson, Cisco and
Nokia. Some of these players such as Nokia and Ericsson also hold
significant intellectual property portfolios. Both Nokia and
Alcatel-Lucent have strong positions in the US where Chinese
vendors are not present. Further, telecoms operators will always
aim to procure from at least two telecoms vendors to minimize
supplier concentration risk. These elements support Nokia's
rating within the context of a competitive sector backdrop.


Fitch's key assumptions within its rating case for the issuer

-- Flat to low single-digit revenue growth over the next four
-- Initial margin dilution following the integration of Alcatel-
    Lucent followed by expansion to around 13% as EUR900m of
    synergies are realised with a full run-rate to be achieved
    2019 (company target 2018).
-- Integration costs of EUR900m to be incurred over the next
    three years, with the majority of outflow in 2017.
-- Capex to remain at around 3% of revenues.
-- Declining but strong net cash position as the company returns
    excess cash to shareholders.


Positive: Future developments that may, individually or
collectively, lead to an upgrade to include:

-- Sustained operational performance and market position within
    core operating divisions including acquired divisions of

-- Evidence that the integration program with Alcatel-Lucent is
    on track, along with no slippage in cost-saving targets.

-- Sustained group EBIT margins in the high single-digit range,
    with healthy revenue and cash flow visibility.

-- Sustained pre-dividend free cash flow (FCF) margins trending
    consistently at 3% to 5% (2015: 1.5%).

-- A conservative financial policy with a sustained net cash
    position that would enable the company to manage integration
    costs, fund R&D and investments through cyclical or macro-
    economic downturns and provide confidence for end-customer
    tendering processes.

Future developments that may, individually or collectively, lead
to the Outlook being changed to Stable include:

-- Deterioration in operating performance in Nokia's core
    operating divisions

-- Sustained delays to or increase in the cost of Nokia's
    integration program with Alcatel-Lucent.

-- Sustained mid-single digit group EBIT margins

-- A lack of progress in pre-dividend FCF generation.

-- Sharp weakening of net cash position because of a sharp
    deterioration in the operating environment or increased
    shareholder remuneration.


MAPLE BANK: March 10 Hearing on Bid for Recognition in U.S.
The U.S. Bankruptcy Court for the Southern District of New York
will convene a hearing on March 10, 2016, at 2:00 p.m., to
consider the request for recognition of the Chapter 15 case of
Maple Bank GmbH as a foreign proceeding.  Objections, if any are
due March 3.

As reported by the Troubled Company Reporter on Feb. 17, 2016,
Maple Bank GmbH, through Dr. Michael C. Frege, in his capacity as
duly appointed insolvency administrator and putative foreign
representative, had filed a Chapter 15 petition in the U.S.
Bankruptcy Court for the Southern District of New York seeking
recognition in the United States of an insolvency proceeding
currently pending in Germany.

Germany's Federal Supervisory Authority, Bundesanstalt fur
Finanzdienstleistungsaufsicht ("BaFin") filed on Feb. 10, 2016,
an application for the opening of insolvency proceedings with the
insolvency court at the Frankfurt am Main Lower District Court
(Amtsgericht Frankfurt am Main).  The Application followed
BaFin's issuance on February 6 of a moratorium under Section 46a
of the German Banking Act (Kreditwesengesetz), which resulted to
Maple Bank's inability to undertake its normal business

According to a document filed with the Court, the February 6
Order is the culmination of an investigation by German
authorities focusing on selected trading activities by Maple
Bank, and certain of its current and former employees, during
taxation years 2006 through 2010.  The German authorities have
alleged that these trading activities violated German tax laws
and are seeking to hold Maple Bank liable for alleged tax
liabilities of up to EUR392 million.

Maple Bank has branches in Toronto, Canada and Den Haag,
Netherlands, which are subject to German and local banking
regulation (including Canada's Office of the Superintendent of
Financial Institutions (OSFI) and the Dutch Imperial Bank
(Rijksbank), and operates regulated broker-dealer subsidiaries in
London, England; Jersey City, New Jersey, U.S.A. and Toronto,
Ontario, Canada.  Maple Bank has no offices or employees in the

The Petitioner believes that the German Proceeding can be
completed most efficiently if he is entrusted with the
administration, realization and distribution of any assets in the
U.S. in accordance with the German Proceeding and the German
Insolvency Act.  As Maple Bank's duly appointed Insolvency
Administrator, the Petitioner immediately assumes possession and
management of the assets belonging to the insolvency estate
pursuant to Section 148 of the German Insolvency Act.

The majority of Maple Bank's assets in the U.S. are located in
New York.  Currently, Maple Bank has a bank account with Deutsche
Bank Trust Company in New York, New York that holds cash
deposits.  Additionally, Maple Bank has a separate United States
bank account with BMO Harris Bank N.A. holding cash deposits and
is the sole shareholder of United States subsidiaries
incorporated under Delaware law.

Court document shows that Maple Bank owns assets with a net book
value of approximately EUR2.6 billion as of Feb. 10, 2016, of
which approximately EUR1.8 billion is located within Germany.

Aside from BaFin, Maple Bank has been subject to the regulation
and control of the German Federal Reserve Bank and is a member of
the Association of German Banks and the Auditing Association of
German Banks.

The Chapter 15 case is under (Bankr. S.D.N.Y. Case No. 16-10336).

Dentons US LLP serves as the Petitioner's counsel.  CMS Hasche
Sigle acts as the German counsel to the Petitioner.

The petitioner is represented by:

         D. Farrington Yates, Esq.
         Giorgio Bovenzi, Esq.
         James A. Copeland, Esq.
         1221 Avenue of the Americas
         New York, NY 10020
         Tel: (212) 768-6700
         Fax: (212) 768-6800

MAUSER HOLDING: Moody's Assigns (P)B2 Rating to EUR100MM Loan
Moody's Investors Service has assigned a provisional (P)B2 rating
to Mauser Holding S.a. r.l.'s proposed EUR100 million
(equivalent) new senior secured tranche C term loan, alongside
the existing EUR823 million equivalent senior secured first lien
term loan due June 2021.  Moody's also affirmed Mauser Holding
GmbH's B3 corporate family rating, B3-PD probability of default
rating, and Mauser Holding S.a r.l's B2 ratings on the EUR823
million equivalent senior secured term loan due 2021, the EUR150
million senior secured revolving credit facility due 2019, the
EUR50 million senior secured capex / acquisition facility due
2021 and the Caa2 rating on the EUR369 million senior secured
second lien term loan.  The outlook on all ratings is stable.

Proceeds from the new EUR100 million senior secured incremental
tranche C term loan facility will be used to fund two
acquisitions.  The rating agency expects the terms and conditions
of the new tranche C facility to be in line with the existing
first lien term loan.

Moody's issues provisional ratings in advance of the final sale
of securities.  Upon a conclusive review of the final
documentation, Moody's will endeavor to assign a definitive
rating to the new tranche C term loan.  A definitive rating may
differ from a provisional rating.

                          RATINGS RATIONALE

The rating assignment and affirmation reflects Moody's view that
the proposed acquisitions are positive for Mauser's business
profile positioning the company more strongly in the specialty
steel drums segment and enabling it to expand its fast growing
intermediate bulk container and reconditioning capabilities.  The
acquisitions will also increase revenues generated in the United
States.  In addition, Moody's expects that the company will
achieve post-acquisition synergies in plant consolidation,
procurement and freight optimization.

The acquisitions follow a period of strong trading performance,
which has benefited from: (1) declining raw material, energy and
freight prices; (2) a continuing shift in product mix towards
intermediate bulk containers and container reconditioning; and
(3) foreign exchange translation gains, which have more than
offset declining demand from certain shale gas customers.

While the financial impact of the acquisitions will be roughly
leverage neutral, Moody's expects Mauser's adjusted debt/EBITDA
(including EUR84 million drawings under the receivables facility)
to be approximately 7.0x, as at the financial year ended 31
December (FYE) 2016, compared with the previous expectation that
it would be materially lower.  In addition, Moody's views the
proposed debt-funded acquisitions as a further example of
Mauser's aggressive financial policy when juxtaposed against the
shareholder distribution, which was funded from add-on term loan
debt and drawings under a new receivables facility less than 12
months ago.

Mauser's B3 corporate family rating reflects its significant
exposure to cyclical end markets, its acquisitive growth strategy
and its weak financial metrics.  Additionally, the company has a
primarily commoditized product line and operates in a fragmented
and competitive industry.  Approximately 40% of business lacks
contractual cost pass-through provisions, lags can be lengthy for
some of the business that has contractual cost pass-throughs at
two to three months and most business lacks cost pass-throughs
for costs other than raw materials.

Strengths in Mauser's credit profile include the company's large
scale and high geographic and product diversity relative to most
competitors.  The rating is also supported by the company's
exposure to some blue chip customers and its much larger market
position than most competitors in a fragmented industry.

Moody's considers Mauser's liquidity to be adequate, supported by
positive free cash flow and cash balances of approximately EUR78
million as at FYE 2015.  In addition, the company's liquidity is
supported by the EUR150 million multicurrency revolver expected
to be undrawn at the close of the transaction and expires in
2019. The company also has a EUR50 million capital expenditure
facility, with anticipated headroom of approximately EUR25
million at the close and expires in 2021.  Liquidity is further
supported by a EUR100 million accounts receivable securitization
facility with headroom of approximately EUR24 million FYE 2015,
which expires in 2017 with a cancellation period of one year.


The stable outlook on the ratings reflects Moody's expectation
that Mauser will gradually improve its key credit metrics,
benefitting from increasing penetration of profitable, growing
markets.  It also incorporates Moody's assumption that the
company will not embark on any large debt-financed acquisitions,
or engage in shareholder-friendly initiatives.


The rating could be upgraded if Mauser sustainably improves its
credit metrics within the context of a stable operating and
competitive environment.  An upgrade would also be contingent
upon the maintenance of adequate liquidity.  Specifically, Mauser
would need to improve adjusted debt/EBITDA to below 6.0x, free
cash flow/debt to the mid-single digits, and an EBIT margin in
the high single digits.

The rating could be downgraded if Mauser fails to improve its
credit metrics and/or if its financial policies become more
aggressive.  Continued debt-funded acquisition activity could
also result in a downgrade. Specifically, the rating could be
downgraded if debt/EBITDA remains above 7.0x and fails to
generate positive free cash flow.

The principal methodology used in these ratings was Packaging
Manufacturers: Metal, Glass, and Plastic Containers published in
September 2015.

Headquartered in Bruhl, Germany, Mauser is a global supplier of
rigid packaging products and services for industrial use.  The
company supplies its customers from 98 manufacturing facilities
in 18 countries across North America, Europe and various emerging
markets.  For FYE 2015, the company generated approximately
EUR1.35 billion in net sales.  Mauser is a portfolio company of
Clayton, Dublier & Rice, Inc.


KEG: Enters Into Sale & Rent Back Agreement with Creditors
MTI-Econews reports that KEG on Feb. 29 said it reached an
agreement with its creditors to sell its base and rent it back.

In turn, the creditors will remove a HUF1 billion lien on the
property, MTI-Econews discloses.

The company said that with the transaction, KEG will avert the
risk of a liquidation procedure, MTI-Econews relates.

KEG has an option to buy back the property later, MTI-Econews

KEG is a Hungarian LPG company.

MFB HUNGARIAN DEV'T: Fitch Affirms 'BB+' Issuer Default Ratings
Fitch Ratings has affirmed MFB Hungarian Development Bank Private
Limited Company's (MFB) and Hungarian Export-Import Bank Private
Limited Company's (Hexim) Long-Term Issuer Default Ratings (IDR)
at 'BB+' with Positive Outlook.


Both banks' IDRs, Support Rating Floors and senior unsecured
long-term ratings are equalized with those of the Hungarian
sovereign (BB+/Positive). The ratings affirmation reflects
Fitch's view that the authorities will continue to provide
support to both banks, if required. The Positive Outlook mirrors
that on the Hungarian sovereign rating.

The agency believes that the government's willingness to support
MFB and Hexim remains strong, while its ability to provide
extraordinary support at all times is currently moderate, albeit
improving, as reflected in the sovereign ratings.

Fitch considers the banks' strategic policy roles to fund
domestic economic growth (MFB) and promote Hungarian exports
(Hexim) to be of high importance in assessing the likelihood of
support. The direct and irrevocable statutory guarantees relating
to both banks' funding activities (funding guarantees) and other
forms of financial support available for both banks from the
state are also key to the rating.

Fitch also takes into consideration the full ownership of both
banks by the state (shareholder rights are exercised by the Prime
Minister's Office (MFB) and the minister in charge of the
Ministry of Foreign Affairs and Trade (Hexim)) as well as
dedicated legal acts (separate for each bank) that define their
mandates, operating rules and relationship with the state.

Both banks rely on wholesale funding, raised in the domestic and
international capital and money markets in the form of bonds,
loans and interbank deposits. The limits of the funding
guarantees for both banks are set annually by the act on the
central budget of Hungary. In 2016 these limits are: HUF1,900
billion (around EUR6 billion) for MFB, up from HUF1,800billion in
2015, and HUF1,200 billion (around EUR4 billion) for Hexim (both
covering also replacement costs of foreign exchange and interest
rate swap transactions). At end-2015, the utilization rates were
56% for MFB and 73% for Hexim (including EUR0.7billion unused
within Hexim's EUR2 billion MTN program). Neither bank is allowed
to raise debt above these limits and both are required to seek
approval from the relevant minister for all major borrowings.
These limits are unlikely to be fully utilized in 2016, in
Fitch's view.

Apart from the funding guarantees, other forms of state support
include back-to-back statutory guarantees on select credit
exposures (total limit of HUF800 billion (MFB) and HUF350 billion
(Hexim)) as per the budget act for 2016, which were only
moderately utilized at end-2015. There are also interest rate
subsidies (MFB), an interest compensation mechanism (Hexim), FX-
risk hedging (MFB), ordinary capital injections and liquidity
support. The combined approved limit of the funding and back-to-
back guarantees is HUF4,250 billion equal to about 13% of
forecast 2015 Hungary's GDP, which represents a potentially
material, but manageable contingent liability for the state.

In 2015 Hexim continued to receive equity injections from the
state, which ensure its capital adequacy amid dynamic loan book
expansion. MFB's existing solid capital buffer (end-1H15 total
capital ratio of 19.25%, consolidated IFRS) is available to
support further expansion planned. Existing non-performing
exposures were reasonably provisioned at both banks at end-3Q15.
Both banks have comfortable liquidity cushions and manageable
refinancing schedules. At the same time, liquidity support from
the state could be made available, if needed, as tested in the
past (2011-2012) when both banks had been offered short-term
bridge financing from the state to optimize timing of capital
market borrowings.

As specialized credit institutions, both banks are exempt from
the Bank Recovery and Resolution Directive, suggesting no
impediments for the state support flowing through to the banks'
senior creditors, and Capital Requirements Directive (CRD IV). At
the same time, both banks are also supervised by the Hungarian
regulator (National Bank of Hungary) and are subject to
compliance, although with certain exemptions, with the prudential
requirements for solvency, risk management, liquidity, disclosure
rules and a few others.

Fitch does not assign Viability Ratings to these banks as their
business models are entirely dependent on the support from the


MFB's and Hexim's ratings are sensitive to changes in the
Hungarian sovereign ratings. Consequently, a potential upgrade of
Hungary would result in an upgrade of the banks' IDRs and senior
unsecured long-term ratings. Hexim's and MFB's rating are also
sensitive to the state's willingness to support them, which Fitch
believes is unlikely to change in the foreseeable future.

The rating actions are as follows:

Long-Term IDR: affirmed at 'BB+'; Outlook Positive
Short-Term IDR: affirmed at 'B'
Support Rating: affirmed at '3'
Support Rating Floor: affirmed at 'BB+'
Senior unsecured debt long-term rating: affirmed at 'BB+'

Long-Term IDR: affirmed at 'BB+'; Outlook Positive
Short-Term IDR: affirmed at 'B'
Support Rating: affirmed at '3'
Support Rating Floor: affirmed at 'BB+'
Senior unsecured debt long-term rating: affirmed at 'BB+'
Senior unsecured debt short-term rating: affirmed at 'B'


VENETO BANCA: S&P Lowers Counterparty Credit Rating to 'B'
Standard & Poor's Ratings Services said that it lowered the long-
term counterparty credit rating on Italy-based Veneto Banca SCPA
to 'B' from 'B+'.  At the same time, S&P affirmed the short-term
counterparty credit rating at 'B'.  The outlook remains negative.

S&P also lowered to 'D' (default) from 'CCC-' its issue rating on
the EUR200 million preferred securities (ISIN: XS0337685324)
issued by Veneto Banca.  This follows its missed payment of
dividends on its due date.

The rating action primarily reflects S&P's view that Veneto's
business and financial profile has deteriorated.  Following
deposit outflows, the bank is now in the process of rebuilding
its liquidity buffers by, among other actions, further reducing
its balance sheet.  Also, the bank's weak profitability, driven
by pressure on revenues and high loan loss provisions, hampers
the possibility of building up capital organically.

Excluding potential one-off disposals, S&P expects Veneto to
remain lossmaking in 2016 and show gradual operating income
improvement only in 2017 on the back of lower loan provisions.
Veneto reported EUR882 million of net losses in its full-year
2015 accounts, which is a weaker performance than S&P expected
and lags that of peers.  This adds to the EUR968 million of
losses recognized in the previous year.  Although the goodwill
write-down (EUR1.1 billion cumulative in the last two years)
inflated the negative results, operating income also remained
subdued, with weak recurring revenues and an increased cost base
on the back of regulatory expenses (such as the deposit guarantee
fund). Moreover, in 2015, credit impairments reached a cost of
risk of about 300 basis points (bps) (compared with 290 bps in
2014), while total provisions and write-downs increased by 11%
year on year, to EUR850 million.  While S&P expects credit
charges to decrease in 2016 from their high level in the previous
two years, these should continue to exceed pre-provision income.

At year-end 2015, the nonperforming loans (NPL) ratio reached a
level as high as 28% of gross customer loans, well above the
average for Italian banks, while coverage remains relatively low
at around 35%.  Although new inflows of NPLs have been decreasing
since last year, S&P expects the stock of impaired loans to keep
growing until 2020, barring any expected sale of NPLs.  This
level of NPLs will continue to constrain both business
development, by tying up a large amount of capital, and profit
generation in the next two years.

At the Extraordinary General Meeting (EGM) in December 2015,
Veneto's shareholders voted in favor of the transformation of the
bank into a joint-stock company, its listing, and a capital
raising of EUR1 billion by April 2016.  Given its low capital
generation, S&P believes that the bank is depending fully on this
capital increase to lift its common equity Tier I (CET1) ratio to
around 11% from the 7.2% as of year-end 2015.

Customer deposits, which S&P considers to be the bank's most
stable funding source, declined by more than 10% in the last year
(mostly in the last quarter).  S&P believes that the negative
flow of news surrounding the resolution of four small Italian
banks, and the decisions taken by Veneto's EGM in December,
partly explain this decline.  S&P understands the outflows have
now stopped.  Still, it will take some time for the bank to
compensate for them.  S&P will continue to monitor any potential
additional outflows.

The bank reported a Basel III liquidity coverage ratio (LCR) of
53% as of Dec. 31, 2015, compared to 89% at Sept. 30, 2015.
Thus, Veneto is currently implementing a remediation plan --
agreed with the regulator -- to reach an LCR above 70%. In order
to generate liquidity, Veneto has accelerated asset deleveraging
by reducing its lending business as well as its securities
portfolio.  In S&P's view, this could penalize profitability and
in turn organic capital generation.  The bank also increased its
reliance on short-term wholesale funding sources, such as
repurchase agreements and interbank sources, to compensate for
the decline in customer funding.  S&P considers these sources of
funding to be vulnerable to changes in investor sentiment and
market conditions. Specifically, S&P estimates that the coverage
of short-term wholesale funding with broad liquid assets was only
around 0.7x at Dec. 31, 2015, compared with 1.0x at Dec. 31,

S&P continues to incorporate one notch of positive adjustment to
uplift the rating on Veneto above the 'b' stand-alone credit
profile.  This takes into account Veneto's rights issue to comply
with the 10% CET1 threshold set by the European Central Bank.
This, coupled with a further improvement of S&P's view of the
domestic operating environment, will likely lead to Veneto
achieving a risk-adjusted capital (RAC) ratio sustainably above

S&P lowered to 'D' from 'CCC-' the issue rating on Veneto
preferred securities.  The rating action follows Veneto's
nonpayment of dividends on its preferred securities on the due
date of Dec. 21, 2015, in line with its announcement made on
Dec. 4 to suspend dividend payments on these securities.

The negative outlook reflects the possibility that S&P could
lower the long-term rating on Veneto Banca if S&P believed it
would be unable to achieve a RAC ratio sustainably above 5% in
the next 12 months.  This could occur if the bank failed to
successfully implement the announced capital-enhancing measures,
or the projected economic improvement in Italy falters, or if the
bank reports higher losses than we currently factor into S&P's
ratings. Moreover, S&P could downgrade Veneto if S&P saw
significant additional deposit withdrawals.

S&P could revise the outlook to stable if Veneto Banca were to
fully execute its capital strengthening plan -- bolstering its
solvency with the announced EUR1 billion capital increase and
asset sales -- while domestic economic risks reduced.


GATEWAY IV - EURO: S&P Affirms BB+p Ratings on 2 Note Classes
Standard & Poor's Ratings Services raised its credit ratings on
Gateway IV - Euro CLO S.A.'s class C, E, and R-Combo notes.  At
the same time, S&P has affirmed its ratings on the class A2, B,
D, S-Combo, and T-Combo notes.

The rating actions follow S&P's credit and cash flow analysis of
the transaction using data from the January 2016 trustee report
and the application of its relevant criteria.

S&P conducted its cash flow analysis to determine the break-even
default rate (BDR) for each rated class of notes.  The BDR
represents S&P's estimate of the maximum level of gross defaults,
based on its stress assumptions, that a tranche can withstand and
still fully repay the noteholders.

Since S&P's previous review on Feb. 25, 2015, the rated notes
have significantly deleveraged, with the class A1 notes having
fully redeemed and the class A2 notes being redeemed by nearly
EUR51 million.  Overall this has resulted in increased levels of
available credit enhancement for all classes of notes, according
to S&P's analysis.

The underlying portfolio includes some exposure to assets
domiciled in lower-rated sovereigns (rated below 'A-') that
exceed 10% of the aggregate collateral balance.  For the purpose
of this review, for the 'AAA' and 'AA' rating categories, S&P has
not given credit to approximately 8% of the assets in its cash
flow model.

S&P factored in the above observations and subjected the capital
structure to its cash flow analysis, based on the methodology and
assumptions outlined in S&P's criteria.  S&P used the reported
portfolio balance that it considered to be performing, the
principal cash balance, the current weighted-average spread, and
the weighted-average recovery rates that S&P considered to be
appropriate.  S&P incorporated various cash flow stress scenarios
using various default patterns, levels, and timings for each
liability rating category, in conjunction with different interest
rate stress scenarios.

In S&P's view, the available credit enhancement for the class A2
and B is commensurate with their currently assigned ratings.  S&P
has therefore affirmed its 'AAA (sf)' ratings on these classes of

For the class C, E, and R-Combo notes, S&P's analysis indicates
that, primarily due to an increase the available credit
enhancement, these notes can achieve ratings higher than those
currently assigned.  Additionally, the class R-Combo notes
comprise a portion of the class C notes.  S&P has therefore
raised its rating on these classes of notes.

S&P's credit and cash flow results indicate that the class D, S-
Combo, and T-Combo notes can achieve ratings higher than those
currently assigned.  However, the results from S&P's largest
obligor supplemental test--a test that addresses concentration
risks that may be present in transactions--indicate that the
ratings on the notes are constrained at higher ratings levels.
As a result, S&P has affirmed its ratings on these classes of


Class               Rating
            To                From

Gateway IV - Euro CLO S.A.
EUR439 Million Floating-Rate Notes

Ratings Raised

C           AAA (sf)          AA+ (sf)
E           BBB+ (sf)         BBB (sf)
R-Combo     AAAp (sf)         AA+p (sf)

Ratings Affirmed

A2          AAA (sf)
B           AAA (sf)
D           A+ (sf)
S-Combo     BB+p (sf)
T-Combo     BB+p (sf)

INTELSAT SA: S&P Lowers CCR to 'CCC', Outlook Negative
Standard & Poor's Ratings Services said it lowered its corporate
credit rating on Luxembourg-based Intelsat S.A. to 'CCC' from 'B'
and removed the ratings from CreditWatch, where S&P had placed
them with negative implications on Feb. 22, 2016.  The outlook is

At the same time, S&P lowered its issue-level rating on the
senior secured credit facility at Jackson to 'B-' from 'BB-' and
left the recovery rating unchanged at '1', indicating S&P's
expectation for very high (90%-100%) recovery for lenders in the
event of a payment default.

In addition, S&P lowered its issue-level rating on the company's
senior unsecured guaranteed notes at Jackson to 'CCC+' from 'B+'
and left the recovery rating on this debt unchanged at '2',
indicating S&P's expectation for substantial (70%-90%; lower end
of the range) recovery for noteholders in the event of a payment

S&P also lowered its issue-level rating on the company's
unsecured non-guaranteed notes at Jackson and Luxembourg to 'CC'
from 'CCC+' and left the recovery rating unchanged at '6',
indicating S&P's expectation for negligible (0-10%) recovery for
lenders in the event of a payment default.

"The ratings downgrade reflects our view that the company could
consider a subpar debt exchange or redemption as part of its
balance sheet initiatives, which in light of Intelsat's steep
debt leverage we would view as a selective default rather than
opportunistic," said Standard & Poor's credit analyst Michael

While the company's balance sheet initiatives remains uncertain,
given current debt trading levels and our expectation for minimal
organic deleveraging over the next several years, it's S&P's
opinion that a distressed exchange is now more likely than
before. The downgrade further reflects S&P's expectation that
adjusted leverage will increase to about 9.2x in 2016 from about
8.1x in 2015, and that free operating cash flow (FOCF) will be
negative through 2017 due to lower than expected revenue and
EBITDA performance.  While S&P had previously anticipated 2016
would be the trough year for Intelsat, the steeper than expected
revenue decline (6.5%-9%) highlights the continued pricing
pressure Intelsat is facing in network services across various
regions as contracts renew, a trend S&P expects to continue for
the foreseeable future.  As a result, S&P expects only a muted
rebound in 2017 due to contribution from Epic, with around 2%
revenue growth, and continued declines in average revenue per
utilized transponder.

The downgrade also reflects the company's need to address its
intermediate-term liquidity position.  While S&P expects
liquidity will remain adequate in 2016, it forecasts that the
company will generate negative FOCF in 2016 and 2017.  In
addition, the company's $450 million revolving credit facility
matures in July 2017.  S&P believes the company has some levers
that could help to address these needs, along with 2018 debt
maturities.  As of Dec. 31, 2015, S&P estimates that the company
had about $1.5 billion of incremental secured debt capacity at
Jackson, taking into account its 6.75x incurrence covenant.  The
company has also put an intercompany loan ($347 million
outstanding at Dec. 31, 2015) in place from a subsidiary of
Intelsat Luxembourg to Intelsat Jackson, which is pre-payable at
any time and can be used to repay a portion of the $475 million
of 6.75% senior notes due 2018 without triggering the 6x
restricted payment (RP) test at Jackson.  However, given the RP
test, the remaining $125 million of 6.75% notes will likely have
to be refinanced or exchanged at Luxembourg.  In addition, the
company is seeking an amendment to permit second-lien pledges by
Luxembourg over the capital stock of Jackson.  If granted, the
amendment would allow the company to issue secured debt at
Luxembourg, which in S&P's view could be more attractive to
debtholders and reduce the longer-term cost of capital at

The negative outlook reflects uncertainty regarding Intelsat's
capital structure initiatives and, in S&P's view, the potential
that the company could pursue a subpar debt exchange given
current debt trading levels.  However, S&P do not foresee risk of
a near-term cash default, and believe the company's secured debt
capacity at Jackson could benefit liquidity over the next few

MAUSER HOLDING: S&P Affirms 'B' CCR, Outlook Stable
Standard & Poor's Ratings Services affirmed its 'B' long-term
corporate credit rating (CCR) on Luxembourg-registered industrial
packaging manufacturer Mauser Holding S.a r.l.  The outlook is

At the same time, S&P affirmed its 'B' issue rating on Mauser's
EUR150 million revolving credit facility (RCF) and EUR50 million
acquisition facility.  The recovery rating on the RCF remains
'3'. S&P also affirmed its 'B' issue ratings on the $420 million
and EUR439 million first-lien term loans, which are being
increased by EUR100 million.  The recovery ratings on these notes
remain '3'. The recovery ratings of '3' indicate S&P's
expectation for meaningful (50%-70%) recovery in the event of
payment default or bankruptcy.

S&P also affirmed its 'CCC+' rating on the $402 million second-
lien term loan.  The recovery rating on these notes remains '6',
indicating S&P's expectation for negligible (0%-10%) recovery in
the event of payment default or bankruptcy.

The affirmation reflects S&P's view that the group's plans to
raise EUR100 million to make a number of acquisitions over 2016
is not likely to have a significant impact on its pro forma
credit metrics, given the group's improved margins, earnings
contributions from the acquisitions, and conservative estimates
of expected synergies.

The tap on the term loan follows a loan increase of EUR89 million
(equivalent) in June 2015, which was used to fund a dividend of
about EUR185 million to shareholder Clayton, Dubilier & Rice

S&P continues to assess the group's financial risk profile as
highly leveraged.  S&P believes the proposed transaction will
result in stable credit metrics, with Standard & Poor's-adjusted
debt to EBITDA of around 7.4x in 2016 -- the same level as S&P's
estimates of 2015 leverage, based upon preliminary accounts.  In
addition, S&P forecasts that EBITDA interest coverage of just
over 2.5x will continue to support the ratings.

Mauser's fair business risk profile is constrained by products
which S&P views as having commodity-like characteristics,
operating in a competitive industry.  Sales volumes and operating
profits can therefore vary, depending on supply-and-demand
conditions and short-term pricing pressures caused by
fluctuations in costs of key raw materials.  Steel and high-
density polyethylene resins are the two primary inputs.  These
risks are partly offset by Mauser's ability to pass through raw
material price changes due to mechanisms in its contracts with
most of its customers.

S&P's assessment also reflects Mauser's large market share in the
industrial rigid packaging segment, including steel and plastic
drums and containers, and intermediate bulk containers (IBCs).
These are mainly used for petrochemical and specialty chemical
applications and sold through a global distribution network.
Mauser also benefits from long-standing relationships with its
diversified customer and supplier base.

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

   -- Revenue growth of nearly 10% in 2016, falling thereafter to
      2%-4%.  The group's planned acquisitions are expected to
      contribute most of this growth -- organic revenue growth
      (excluding foreign exchange effects) would be more modest.
      Most of the group's organic growth would come from Mauser's
      reconditioning business.  Forecast volume increases in
      Europe would be offset by difficult trading conditions in
      the U.S. and Brazil, and the pass-through of lower raw
      material costs.

   -- Standard & Poor's-adjusted margins to improve to over 14%,
      as volumes in the higher-margin reconditioning business
      grow and cost-saving initiatives pay off.  S&P also
      anticipates a reduction in the cost of raw materials,
      although most of these savings will be passed through to
      customers as price concessions.  Synergies are expected to
     offset lower margins at the group's planned acquisitions.

   -- Anticipated acquisitions of EUR100 million over the course
      of 2016.  S&P has forecast further bolt-on acquisitions in
      subsequent years of up to EUR20 million per year, in line
      with the group's strategy.

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

   -- Adjusted debt-to-EBITDA around 7.4x in 2016, improving to
      7.0x-7.2x in 2017.

   -- Funds from operations (FFO)-to-debt in the region of 7%.

   -- Positive free operating cash flow of over EUR60 million.

   -- FFO cash interest coverage maintained over 2.5x.

The stable outlook reflects S&P's view that Mauser's credit
metrics should recover quickly following the planned term-loan
increase, supported by earnings contributions from its
acquisitions, expected synergies, and improved operating
performance.  Nevertheless, S&P expects the group's financial
risk profile will remain highly leveraged.

S&P could consider lowering the rating if FFO cash interest
coverage falls below 2x, or liquidity deteriorates.  The ratings
could also come under pressure if Mauser's free operating cash
flow generation was to remain negative for a sustained period, or
S&P observed a contraction in EBITDA margins that appeared
unlikely to recover.  In addition, S&P could lower the rating if
the funds raised were used for purposes other than expanding the
business or repaying debt.

S&P does not view an upgrade as likely over the next 12-18
months, given the group's very high leverage and aggressive
financial policies, as demonstrated by its recent dividend


CADOGAN SQUARE: Moody's Raises Rating on Class E Notes to Ba3
Moody's Investors Service has upgraded the ratings on these notes
issued by Cadogan Square CLO III B.V.:

  EUR27.5 mil. Class C Senior Secured Deferrable Floating Rate
   Notes due 2023, Upgraded to Aa1 (sf); previously on Aug 4,
   2015, Upgraded to Aa2 (sf)

  EUR30 mil. Class D Senior Secured Deferrable Floating Rate
   Notes due 2023, Upgraded to Baa1 (sf); previously on Aug. 4,
   2015, Affirmed Baa3 (sf)

  EUR18.75 mil. Class E Senior Secured Deferrable Floating Rate
   Notes due 2023, Upgraded to Ba3 (sf); previously on Aug. 4,
   2015, Affirmed B1 (sf)

Moody's has also affirmed the ratings on these notes:

  EUR342.65 mil. (current outstanding balance of EUR 82.4 mil.)
   Class A Senior Secured Floating Rate Notes due 2023, Affirmed
   Aaa (sf); previously on Aug. 4, 2015, Affirmed Aaa (sf)

  EUR36.1 mil. Class B Senior Secured Floating Rate Notes due
   2023, Affirmed Aaa (sf); previously on Aug. 4, 2015, Affirmed
   Aaa (sf)

Cadogan Square CLO III B.V., issued in December 2006, is a
collateralised loan obligation (CLO) backed by a portfolio of
mostly high-yield senior secured European loans managed by Credit
Suisse Asset Management Limited.  The transaction's reinvestment
period ended in January 2013.

                          RATINGS RATIONALE

According to Moody's, the rating action taken on the notes is the
result of the deleveraging since last rating action in August

On the last payment date the Class A notes have paid down by
approximately EUR23.8 million (6.9% of closing balance), as a
result of which over-collateralization (OC) ratios of all classes
of rated notes have increased significantly.  As per the trustee
report dated January 2016, Class A/B, Class C, Class D, and Class
E OC ratios are reported at 166.8%, 139.8%, 118.8% and 108.6%
compared to July 2015 levels of 153.4%, 133.1%, 116.2%, and
107.7%, respectively.  These reported OC ratios do not take into
account the pay-down of Class A notes on the payment dates in
January 2016 and July 2015 respectively.

The key model inputs Moody's uses in its analysis, such as par,
weighted average rating factor, diversity score and the weighted
average recovery rate, are based on its published methodology and
could differ from the trustee's reported numbers.  In its base
case, Moody's analyzed the underlying collateral pool as having a
performing par and principal proceeds balance of EUR241.4
million, defaulted par of EUR10.7 million, a weighted average
default probability of 21.6% (consistent with a WARF of 3119), a
weighted average recovery rate upon default of 47.8% for a Aaa
liability target rating, a diversity score of 28 and a weighted
average spread of 3.95% and a weighted average coupon of 6.6%.

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.  Moody's generally applies recovery rates
for CLO securities as published in "Moody's Approach to Rating SF
CDOs".  In some cases, alternative recovery assumptions may be
considered based on the specifics of the analysis of the CLO
transaction.  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.

Methodology Underlying the Rating Action:

The principal methodology used in these ratings was "Moody's
Global Approach to Rating Collateralized Loan Obligations"
published in December 2015.

Factors that would lead to an upgrade or downgrade of the

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 for
the portfolio.  Moody's ran a model in which it reduced the
weighted average recovery rate by 5%; the model generated outputs
were unchanged for Class A and Class B and within one to two
notches of the base-case results for rest of the classes.

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:

  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 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 13.8% 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 and available at:

  Recovery of defaulted assets: Market value fluctuations in
   trustee-reported defaulted assets and those Moody's assumes
   have defaulted can result in volatility in the deal's over-
   collateralization levels.  Further, the timing of recoveries
   and the manager's decision whether to work out or sell
   defaulted assets can also result in additional uncertainty.
   Moody's analyzed defaulted recoveries assuming the lower of
   the market price or the recovery rate to account for potential
   volatility in market prices. Recoveries higher than Moody's
   expectations would have a positive impact on the notes'

  Long-dated assets: The presence of assets that mature beyond
   the CLO's legal maturity date exposes the deal to liquidation
   risk on those assets.  Moody's assumes that, at transaction
   maturity, the liquidation value of such an asset will depend
   on the nature of the asset as well as the extent to which the
   asset's maturity lags that of the liabilities.  Liquidation
   values higher than Moody's expectations would have a positive
   impact on the notes' ratings.

In addition to the quantitative factors that Moody's explicitly
modeled, 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.

INTERGEN NV: Moody's Affirms B1 Rating on Sr. Secured Loan
Moody's Investors Service changed the rating outlook at InterGen
N.V. to negative from stable reflecting lower merchant cash flows
owing to sustained weak power markets, primarily in the UK.
Concurrent with this outlook change, Moody's affirmed InterGen's
B1 senior secured rating for its term loan, revolver and bonds.

                         RATINGS RATIONALE

The change in rating outlook to negative reflects the company's
exposure to weak merchant power markets, particularly in the UK,
resulting in a decline in distributions from InterGen's UK power
project portfolio.  This credit deterioration largely reflects a
continuation of weak UK power prices and spark spreads during
2015.  InterGen has three natural gas-fired power assets in the
UK: Coryton (770 MWs); Rocksavage (805MWs); and Spalding
(860MWs). The first two are pure merchant power generators and
sell into the UK power grid.  The third -- Spalding -- has a
long-term tolling agreement with Centrica plc (Baa1; on review
for downgrade).

In addition to the decline in distributions coming from the UK
assets to InterGen, there has been a decline in the distributions
from La Rosita, a 780MW natural gas-fired power generator in
Mexico, primarily driven by lower payments under project off-take
contracts.  The UK assets along with La Rosita in Mexico make up
InterGen's Tier I assets (those that are 100% owned and have no
project level debt).  The Tier II assets in Australia, Europe and
Mexico round out the remainder of the InterGen portfolio, all of
which have project level debt except Bajio.  All in all, lower
distributions coming up to the InterGen holding company from the
project level resulted in about an 18% drop in CFADS for the
twelve months ended 9/30/15 compared to our expectations for 2015
in the Moody's base case at the time of the June 2013
refinancing. The Moody's base case also assumed a recovery in UK
power prices beginning in 2016.  It now appears that such a
recovery could take much longer to occur.

UK electricity prices have fallen sharply in recent months, owing
to weakening gas prices.  The UK has also seen growth in addition
capacity, particularly in renewables, which combined with weak
demand, is maintaining wide reserve margins.  Based on the
current forward market, prices are expected to remain around the
current levels for several years.  That said, due to the
deteriorating conditions for coal plants, there have been a
number of retirements announced since late 2015.  This has helped
push Winter 2016/2017 spark spreads up by GBP1-2/MWh.  Moody's
believes, however, that UK power prices will remain flat for a
longer period with the potential for further downward pressure
developing in the early 2020s as a result of increasing
interconnection with lower-taxed continental European markets.

On the positive side, Moody's notes that InterGen's UK plants did
clear both of the auctions in the new UK capacity market.  The UK
implemented a forward capacity market, which held its first
auction in December 2014, in which generators and electricity
importers offered to make supply available between October 2018
and September 2019 in exchange for fixed payments for the
2018/2019 capacity year of GBP19.40/kW-yr.  All three of
InterGen's UK plants cleared that auction as well as the second
auction in December 2015 for the 2019/2020 capacity year at
GBP18.00kW-yr.  Based on these clearing prices and the amount of
capacity at the three InterGen plants that cleared the market,
Moody's calculates that about GBP40-45 million in additional
revenue will occur starting in the 2018/2019 period (or about $60
million at the current exchange rate).  As a point of comparison,
this incremental revenue represents about 8% of InterGen's 2014
consolidated revenues.  While future revenue may help to mitigate
the continued weakness in merchant energy sales, receipt of such
revenues are several years away.  In the meantime, InterGen will
be plagued by reduced cash flow from merchant generators until

The decline in distributions has resulted in lower debt service
coverage ratios (DSCR) for 2015.  The DSCR at year end 2014 was
1.92x, which was more or less in line with Moody's expectations
for the year.  Since then, however, Moody's has seen a
significant drop off in coverage as the DSCR for the 12 months
ended Sept. 30, 2015, stood at 1.52x.

While several years away, there is the potential for higher
refinancing risk for InterGen when the term loan matures in June
2020, particularly if weak merchant power prices persist until
the end of the decade.  From a liquidity perspective, InterGen
has access to ample external liquidity of approximately $320
million and internal liquidity of $204 million in cash and cash
equivalents at Sept. 30, 2015, which provides the company with
working capital, if needed, during this period where margins are
expected to be weaker.  InterGen's $500 million Revolving Credit
Facility expires in June 2018.


The negative outlook reflects Moody's expectations that UK
merchant power prices will remain weak for at least the next
several years and that InterGen's financial metrics will remain
below expectations.

What Could Change the Rating -- Up

Given the negative outlook, it is unlikely that the rating could
go up in the near term.  The outlook could stabilize if power
prices in the UK recover sufficiently or there are cash flows
from other projects that result in the DSCR returning to
historical levels on a sustainable basis, or if there is a
reasonable plan and forecast to get there.

What Could Change the Rating - Down

Conversely, there could be negative rating action if merchant
prices do not recover and we believe that coverage ratios will
remain a current levels for the foreseeable future or reduce
further, or if the portfolio of assets experience operational
issues that have a sustained impact on the company's performance
resulting in the DSCR hovering around 1.50x or below on a
sustained basis.

InterGen N.V. is a holding company with a portfolio consisting of
16 projects worldwide that includes 12 power plants representing
about 5,581MWs of net power generating capacity, made up of 9
combined cycle natural gas-fired projects, two coal-fired
facilities and one wind power asset.  The 12 power plants are
located in the UK, the Netherlands, Mexico, and Australia.
InterGen also owns the Bajio and Libramiento natural gas
compression facilities and associated pipeline located adjacent
to the Bajio power project, as well as the Altamira compression

InterGen N.V. is equally owned by China Huaneng Group (CHG) /
Guangdong Yudean Group (Yudean) and The Ontario Teachers' Pension
Plan Board (OTPPB).

The principal methodology used in these ratings was Power
Generation Projects published in December 2012.


HAVILA SHIPPING: Misses Interest Payment to Bondholders
David Foxwell at Offshore Support Journal reports that troubled
offshore vessel owner Havila Shipping, which has reached an
agreement with lenders to restructure, but has failed to reach
agreement with its bondholders, has missed an interest payment it
was due to make.

According to Offshore Support Journal, Nordic Trustee, which acts
as the trustee for Havila's bondholders, says an interest payment
due to bondholders on HAVI08 on Feb. 29 did not take place and
that, as a result, the company is in default.

In mid-February, Havila said it planned to continue operations
and continue negotiations with creditors in order to reach an
agreement, Offshore Support Journal recounts.  However, it also
said that, during the negotiating period the company would not
pay interest, amortizations or other commitments to its
creditors, a move that has the support of its banks, Offshore
Support Journal relays.

Headquartered in Fosnavag, Norway, Havila Shipping ASA operates a
number of vessels, including platform supply vessels, anchor
handling tug supply vessels, and rescue and recovery vessels.
The Company provides supply services to offshore companies both
national and international.

NORSKE SKOGINDUSTRIER: BlueCrest Says Won't Profit From Default
Luca Casiraghi at Bloomberg News reports that BlueCrest Capital
Management denied that it stands to profit from a default by
Norske Skogindustrier ASA as the fund manager seeks a court order
preventing the Norwegian paper maker from exchanging bonds.

"The economic interests of BlueCrest are completely aligned with
Norske's long-term financial health," Bloomberg quotes
Deniz Akgul, a London-based credit trader at BlueCrest, as saying
in a letter to the New York court hearing the case.  Its funds
"are net long," meaning they hold more bonds than credit-default

Norske Skog's debt-swap plan has divided investors, with
opposition from secured bondholders including BlueCrest and
support from unsecured creditors including Blackstone Group LP's
GSO Capital Partners, Bloomberg discloses.  The company has said
that opponents are trying to drive it into bankruptcy to profit
from bets against its survival, and its Chief Executive Officer
Sven Ombudstvedt told the court his "understanding" was that
BlueCrest holds as much as EUR130 million (US$141 million) of
default insurance, Bloomberg relates.

"Mr. Ombudstvedt's 'understanding' is unsupported and incorrect,"
Mr. Akgul, as cited by Bloomberg, said in the letter.  The figure
also contradicts previous statements from the paper maker,
Mr. Akgul said in the letter, citing e-mails between the Norske
Skog's lawyer and BlueCrest's advisers from last year, Bloomberg

                       About Norske Skog

Norske Skogindustrier ASA or Norske Skog, which translates as
Norwegian Forest Industries, is a Norwegian pulp and paper
company based in Oslo, Norway and established in 1962.

As reported by the Troubled Company Reporter-Europe in mid-
November 2015, Moody's Investors Service downgraded Norske
Skogindustrier ASA's (Norske Skog) Corporate Family Rating
("CFR") to Caa3 from Caa2 and its Probability of Default Rating
(PDR) to Ca-PD from Caa2-PD.  Standard & Poor's Ratings Service
also downgraded the Company's long-term corporate credit rating
to CC from CCC.


BORETS INTERNATIONAL: S&P Puts 'BB-' CCR on CreditWatch Negative
Standard & Poor's Ratings Services said it has placed its ratings
on Russian electric submersible pump producer, Borets
International Ltd., including its 'BB-' corporate credit rating,
on CreditWatch with negative implications.

The CreditWatch placement follows the continued weakening of the
Russian ruble versus the U.S. dollar, which has heightened the
currency mismatch between Borets' revenues and debt.  Therefore,
S&P believes that the company will post materially weaker credit
metrics than we anticipated, with FFO to debt falling below 20%.

Despite Borets' expected good organic growth in its home market
in 2015 and 2016, and a certain resilience to oil price decline
going forward, S&P believes that a weak ruble, combined with
general uncertainty regarding Russian oil production levels in
2016, will continue to weigh on the company's cash flow
generation and its ability to service debt.

At the same time, across the industry S&P has begun to observe
oil majors tightening payment terms and putting pricing pressure
on their suppliers.  S&P believes this trend could also
ultimately affect Borets.  While the company has a good track
record of adjusting its capital expenditure to manage cash flow,
large working capital outflows would lead to negative free
operating cash flow generation, which may not be commensurate
with S&P's current ratings.

In resolving the CreditWatch, S&P will review the company's
results, as well as management's plans for the refinancing of the
$413 million bond maturing in September 2018.  S&P could lower
the ratings if it anticipates that Borets' operating performance
will deteriorate in 2016, resulting in weak credit ratios that
are no longer commensurate with our current 'BB-' corporate
credit rating.  For the rating to remain at 'BB-', FFO to debt
would likely need to remain above 20%, on a sustainable basis,
assuming liquidity remains adequate.  If S&P was to downgrade
Borets, it would be limited to one notch on the corporate credit

KOKS OAO: S&P Lowers Long-Term Corporate Credit Rating to 'B-'
Standard & Poor's Ratings Services lowered its long-term
corporate credit rating on Russia-based vertically integrated
coking coal, coke, iron ore, and pig iron producer OAO Koks to
'B-' from 'B'.

At the same time, S&P lowered its issue-level rating on company's
$199 million senior unsecured Eurobond to 'CCC+' from 'B-'.

S&P placed both ratings on CreditWatch with negative

The downgrade primarily reflects the deterioration of Koks'
liquidity, which S&P views as primarily a result of aggressive
liquidity management.  S&P understands that on Jan. 1, 2016,
Koks' short-term maturities totaled about Russian ruble (RUB) 36
billion (about $0.5 billion), representing more than 50% of its
total debt.  This includes a bond of $199 million due June 2016,
as well as a number of various bilateral facilities with Russian

S&P notes that Koks' operating performance remains healthy and
its leverage manageable, with estimated debt to EBITDA of 3.5x at
the end of 2016.  Therefore, its weak liquidity is mostly an
outcome of its aggressive approach to refinancing, rather than a
lack of market access.  S&P understands the company is currently
working on raising new financing and hopes to improve its
liquidity position within the next four to six weeks.  S&P will
need to reassess its liquidity position post-refinancing and
could affirm the rating at 'B-' if the company manages to
refinance the bond and part of its short-term maturities,
removing the immediate refinancing risk.  However, S&P do not
expect to rate Koks higher than 'B-' as long as its liquidity
management remains aggressive.

S&P continues to view Koks' business risk as weak, stemming from
exposure of coke and pig iron--the company's key products--to the
very cyclical steel industry, which explains S&P's view on
company's profitability as highly volatile.  Additional pressure
comes from moderately high industry risk and high operating risk
in Russia, where all the company's assets are located.  S&P views
as positive the company's substantial resource base, sufficient
for decades of operations; and the high degree of self-
sufficiency in its key inputs, coking coal and iron ore.

Koks' aggressive financial risk profile reflects its moderate
debt leverage, supported by healthy performance in the first half
of 2015 with high margins, thanks to a weak ruble.  S&P notes
that the company has meaningfully reduced its capital
expenditures (capex) and generates positive free operating cash
flow, which helps mitigate the impact of revaluation of its
foreign currency debt, which weakened its credit metrics.

S&P continues to see a risk that Koks' leverage might increase
beyond S&P's base-case projection as a result of its involvement
in the Tula steel project (Tulachermet).  S&P notes that Koks has
sold its stake in the project, which is owned by Koks' ultimate
shareholders, however it has provided a large long-term loan to
Tulachermet.  S&P do not currently forecast additional
investments by Koks in the project, but S&P cannot completely
rule it out, given the track record.  This explains S&P's
negative financial policy adjustment.

The CreditWatch reflects the risk that S&P could further lower
the rating if Koks does not materially improve its liquidity
position in the next four to six weeks.  Notably, S&P expects the
company will refinance its $199 million bond due June 2016 and
extend the maturity of its bilateral lines.  S&P will reassess
the company's liquidity position post-refinancing and could
affirm the rating if the immediate refinancing risk has been
removed.  S&P aims to resolve the CreditWatch by mid-April.


ABENGOA SA: Replaces Chairman, Ends Shareholder Contract
Rodrigo Orihuela and Macarena Munoz at Bloomberg News report that
Abengoa SA, which earlier this week reported a EUR1.2 billion
(US$1.3 billion) loss for 2015, replaced its chairman and ended a
contract with a shareholder amid talks with creditors to avoid

According to Bloomberg, the company said in a regulatory filing
on March 1 Antonio Fornieles, formerly vice chairman, was named
executive chairman.  Mr. Fornieles replaces Jose Dominguez
Abascal, who was executive chairman, Bloomberg discloses.

Joaquin Fernandez de Pierola, who was general manager, becomes
chief executive officer, Bloomberg relates.  The company said in
the filing it also canceled an advisory contract signed in
September with former Chairman Felipe Benjumea, Bloomberg notes.

The management reshuffle is the latest stage in a months-long
reorganization that started in November, when Abengoa requested
preliminary bankruptcy protection, Bloomberg states.

Abengoa SA is a Spanish renewable-energy company.

                        *       *       *

As reported by the Troubled Company Reporter-Europe on Dec. 21,
2015, Standard & Poor's Ratings Services lowered to 'SD'
(selective default) from 'CCC-' its long-term corporate credit
rating on Spanish engineering and construction company Abengoa
S.A.  S&P also lowered the short-term corporate credit rating on
Abengoa to 'SD' from 'C'.  S&P said the downgrade reflects
Abengoa's failure to pay scheduled maturities under its EUR750
million Euro-Commercial Paper Program.


CLARIANT AG: Moody's Affirms Ba1 CFR & Changes Outlook to Neg.
Moody's Investors Service has changed to negative from stable the
outlook on all ratings of Clariant AG and its subsidiary Clariant
Finance (Luxembourg) S.A.  Concurrently, Moody's affirmed the
company's Ba1 corporate family rating (CFR), Ba1-PD probability
of default rating (PDR) and Ba1 ratings assigned to the various
senior unsecured debt instruments of Clariant and Clariant
Finance (Luxembourg) S.A.

                         RATINGS RATIONALE

The change of outlook to negative reflects Clariant's lack of
progress in reducing debt leverage in the wake of the acquisition
of Sued-Chemie AG in 2011, as the group consistently generated
negative free cash flow after capex and dividends (FCF).  Despite
a relatively resilient operating performance, this has left its
financial metrics weakly positioned relative to the Ba1 rating at
the 2015 year-end.

Since the CHF2.5 billion acquisition of SÅd-Chemie (CHF1.1
billion of which funded by a share capital increase) in April
2011, Clariant's continuously generated negative FCF.  This
reflected a combination of factors.  Operating cash flow was
constrained by increases in working capital resulting in a
cumulative cash outflow of around CHF700 million during the
period 2012-15, at a time when growth in operating profit was
dampened by large restructuring charges consuming 20% of funds
from operations (FFO), margin pressures in the mature Plastics &
Coatings business, as well as adverse currency effects resulting
from the appreciation of the Swiss franc and volatility in
emerging market currencies.

At the same time, keen to leverage the favorable growth prospects
enjoyed by its Care Chemicals, Catalysis and Natural Resources
businesses, Clariant maintained a relatively high level of
capital expenditure to fund growth projects.  In the past four
years, adjusted capex averaged close to 7% of sales.

Also, in 2012, Clariant resumed payment of dividends out of 2011
profits, having suspended cash distribution to shareholders
during the restructuring phase in 2008-10.  It has since
increased the company's dividend payout at an compound average
growth rate of 7.5% p.a., while funds from operations were
largely flat.

Overall, despite raising close to CHF850 million in proceeds from
asset disposals, Clariant only reduced net debt (as adjusted by
Moody's) by CHF265 million during the four years to December
2015. As a result, the group's financial leverage remains
elevated. Total debt to EBITDA (on a Moody's adjusted basis) was
close to 5.0 times at the 2015 year-end, bearing in mind that the
group's total debt is somewhat inflated by the large liquidity
buffer maintained by Clariant in place of committed credit
facility, while retained cash flow (RCF) to net debt was just
above 16%.

However, Clariant's Ba1 CFR remains underpinned by its business
risk profile which was significantly enhanced by the
comprehensive restructuring and successful portfolio realignment
carried out in the past four years, including the acquisition of
leading catalyst producer, SÅd-Chemie, concurrently with the
divestment of several low margin, cyclical businesses.

Looking ahead, Moody's expect that the organic growth potential
of Clariant's enhanced portfolio businesses as well as a
continuous focus on innovation and operational efficiency will
help underpin future operating profitability.  Also, following
the carve-out of Plastics & Coatings into a separate legal entity
at the start of 2016, Clariant intends to put the emphasis on
maximizing absolute EBITDA and cash flow generation for this
mature business.  Combined with reduced restructuring cash
outlays, increased focus on improving working capital and a
return to normalized capex levels of CHF300-CHF350 million p.a.,
this should help strengthen the group's future operating cash
flow generation.

A stabilization of the rating outlook will require that Clariant
return to positive FCF on a consistent basis, so to be able to
permanently reduce debt and reposition its financial metrics in
line with the Ba1 CFR, including total debt to EBITDA below 4x
(leaving net debt to EBITDA close to 3x given the large cash
reserves typically held by the group) and RCF to net debt close
to 20%.


The Ba1 rating would come under pressure should Clariant fail to
return to positive FCF generation and reduce financial leverage
in the next 12 months, resulting in total debt to EBITDA falling
below 4x (equivalent to net debt to EBITDA close to 3x given the
large cash reserves typically held by the group) and RCF to net
debt rising close to 20%.

Although unlikely considering the negative outlook, a return to
consistent positive FCF generation leading to some significant
reduction in the group's leverage and improvement in financial
metrics (including RCF/net debt in the mid twenties and debt/
EBITDA below 3.0x) would support a rating upgrade.


The principal methodology used in these ratings was Global
Chemical Industry Rating Methodology published in December 2013.
Headquartered in Muttenz, Switzerland, Clariant AG is a leading
international chemicals group.  In 2015, Clariant reported
revenues of approximately CHF5.8 billion and EBITDA of CHF767

U N I T E D   K I N G D O M

EASTERN CONTINENTAL: Insolvency Proceedings Recognized in U.S.
U.S. Bankruptcy Judge Brendan L. Shannon has granted recognition
as foreign main proceeding the proceeding commenced under the
United Kingdom's Insolvency Rules 1986 by Eastern Continental
Mining and Development Ltd.

No objections were filed to the Chapter 15 petition of Ninos
Koumettou, as Foreign Representative of Eastern Continental, and
the motion for recognition.

Ninos Koumettou, in his capacity as the liquidator and authorized
foreign representative of Eastern Continental Mining and
Development Ltd, filed a Chapter 15 bankruptcy petition (Bankr.
D. Del. Case No. 16-10121) on Jan. 18, 2016, in the United
States, seeking recognition of a proceeding commenced under the
United Kingdom's Insolvency Rules 1986.

Based in London, the Debtor was formed to explore and develop
direct investment opportunities in the Asian raw materials and
mineral resources sector.  The Debtor planned to construct
networks of mineral mining and collection, processing and
shipping centers. Its principal focus was developing
opportunities in Indonesia, with a view to exporting to other
Asian economies including China, India, Japan, and Korea.

EUROHOME UK: Fitch Hikes Class B1 Debt Rating to 'Bsf'
Fitch Ratings has upgraded five tranches of Eurohome UK series
2007-1 and 2007-2 (securitizations of UK non-conforming loans
comprising loans originated by DBUK) due to the discovery of an
inconsistent calculation in Fitch's UK RMBS Surveillance Model.
The other tranches are unaffected and have been affirmed. The
ratings are as follows:

Eurohome UK Mortgages 2007-1 plc:
Class A (ISIN XS0290416527): affirmed at 'Asf'; Outlook Stable
Class M1 (ISIN XS0290417418): affirmed at 'BBBsf'; Outlook Stable
Class M2 (ISIN XS0290419380): affirmed at 'BB+sf'; Outlook Stable
Class B1 (ISIN XS0290420396): upgraded to 'Bsf'; from 'CCCsf';
Stable Outlook assigned
Class B2 (ISIN XS0290420982): upgraded to 'Bsf'; from 'CCCsf';
Stable Outlook assigned

Eurohome UK Mortgages 2007-2 plc:
Class A2 (ISIN XS0311691272): affirmed at 'AAAsf'; Outlook Stable
Class A3 (ISIN XS0311693484): upgraded to 'A+sf' from 'Asf';
Outlook Stable
Class M1 (ISIN XS0311694029): affirmed at 'BBBsf'; Outlook Stable
Class M2 (ISIN XS0311695182): affirmed at 'BBsf'; Outlook Stable
Class B1 (ISIN XS0311695778): upgraded to 'Bsf'; from 'CCCsf';
Outlook Stable assigned
Class B2 (ISIN XS0311697394): upgraded to 'Bsf'; from 'CCCsf';
Outlook Stable assigned


The rating revisions follow the discovery of an inconsistent
calculation in Fitch's UK RMBS Surveillance Model, which resulted
in weighted average foreclosure frequencies that were too high.
The correction of this inconsistency has led to a downward
revision of the weighted average foreclosure frequencies and thus
expected losses for these two transactions, across all rating

Fitch has reassessed the two transactions and found that the
credit enhancement supporting some classes of notes is sufficient
to withstand higher rating stresses, considering the sound
performance of the deals. This view is reflected in the upgrade
of the class A3 notes of Eurohome UK Mortgages 2007-2 and the
class B1 and B2 notes of both transactions.


The transactions are backed by floating-interest-rate loans. In
the current low interest rate environment, borrowers are
benefiting from low borrowing costs. An increase in interest
rates could therefore lead to performance deterioration of the
underlying assets and consequently downgrades of the notes if
defaults and associated losses exceed those of Fitch's stresses.


No third party due diligence was provided or reviewed in relation
to this rating action.


Fitch has checked the consistency and plausibility of the
information it has received about the performance of the asset
pools and the transactions. There were no findings that were
material to this analysis. Fitch has not reviewed the results of
any third party assessment of the asset portfolio information or
conducted a review of origination files as part of its ongoing

Fitch did not undertake a review of the information provided
about the underlying asset pools ahead of the transactions'
initial closing. The subsequent performance of the transactions
over the years is consistent with the agency's expectations given
the operating environment and Fitch is therefore satisfied that
the asset pool information relied upon for its initial rating
analysis was adequately reliable.

Overall, Fitch's assessment of the information relied upon for
the agency's rating analysis according to its applicable rating
methodologies indicates that it is adequately reliable.

GEMINI PLC: Moody's Affirms Ca Rating on Class A Notes
Moody's Investors Service has affirmed the ratings of two classes
of Notes issued by Gemini (Eclipse 2006-3) plc.

Moody's rating action is:

Issuer: GEMINI (ECLIPSE 2006-3) plc

  GBP615 mil. (current outstanding balance of EUR412.3 mil.)
   A Notes, Affirmed Ca (sf); previously on July 8, 2014,
   Affirmed Ca (sf)

  GBP30 mil. (current outstanding balance of EUR27.8 mil.) B
   Notes, Affirmed C (sf); previously on July 8, 2014, Affirmed
   C (sf)

Moody's does not rate the Class C, Class D, and the Class E

                         RATINGS RATIONALE

The affirmation action reflects the continuing expectation of
losses on all bonds issued.  Since Moody's last review the
remaining 24 properties have been sold (of which one property is
due to complete by the July IPD).  As expected, the sale proceeds
were insufficient to cover the remaining swap exposure plus the
Class A Note principal balance.

Our ratings reflect an expected recovery rate in the range of 35%
to 65% for the Class A Notes and less than 35% recoveries for the
Class B Notes.  To date, 33% of the Class A notes have been
recovered, with some further proceeds expected once the sale of
the final property completes.  Gross sale proceeds are expected
to be circa GBP10.8 million in respect of this remaining
property.  No further recoveries are expected for the Class B

Methodology Underlying the Rating Action:

The principal methodology used in these ratings was Moody's
Approach to Rating EMEA CMBS Transactions published in July 2015.

Factors that would lead to an upgrade or downgrade of the

Factors that would lead to an upgrade or downgrade of the ratings
would be a significant change in the level of recoveries.
However since the properties have now been sold (save to one)
Moody's can predict Class A recovery levels with some certainty.
There is an outstanding Valuation Claim, which if successful,
could lead to further recoveries on the class A notes.  However,
given that the original claim was in the region of GBP173
million, any recoveries on the Class A notes would still be
within an expected recovery range commensurate with the current
rating level.

                    MOODY'S PORTFOLIO ANALYSIS

As of the January 2016 IPD, the transaction balance has reduced
by 24.50% to GPB 693.51 mil. from GPB 918.86 mil. at closing in
November 2006.  35 of the 36 assets have now been sold, with the
remaining asset sale due to complete prior to the July 2016 IPD.
Gross sales proceeds are expected to be circa GBP10.8 million.

There is an ongoing claim against the valuer which is scheduled
to go to trial in Q4 2016.  The initial negligence claim was
issued in 2012.  Once settled, the transaction will be wound up.
If the claim is successful, the extra recoveries would still fall
within our recovery rate range on the Class A notes and therefore
we do not expect any further rating changes.

Given the extraordinary resolution which was passed in January
2016 following a noteholders meeting, Moody's expects the ratings
on this transaction to be withdrawn in due course.

NELSON PACKAGING: In Administration, 40 Jobs Affected
Belfast Telegraph reports that Nelson Packaging has gone out of
business, blaming the introduction of a 5p charge for plastic
bags in England.

Forty workers have lost their jobs at Nelson Packaging's factory
in Lancashire, Belfast Telegraph discloses.

According to Belfast Telegraph, Managing director Michael Flynn
said: "Unfortunately Nelson Packaging had to enter into
administration.  This was an outcome primarily of the English bag
legislation and the corresponding impact on customer and retailer
demand for plastic carrier bags.

"Added to aggressive overseas competition this ultimately proved
too devastating for the ongoing viability of the business,
despite the continued efforts of the loyal workforce."

The 5p charge for bags was introduced in England last October
following similar moves in Wales, Northern Ireland and Scotland,
Belfast Telegraph recounts, Belfast Telegraph recounts.

Nelson Packaging is a packaging firm.

PRESBYTERIAN MUTUAL: Moore Stephens Faces Fine Over Audit
Claire McNeilly at Belfast Telegraph reports that Northern
Ireland chartered accountants Moore Stephens have been fined by
the Financial Reporting Council over the auditing of the
collapsed Presbyterian Mutual Society.

According to Belfast Telegraph, the firm was given a GBP200,000
fine, discounted for settlement to GBP140,000, and a reprimand
following failures in the audit of the financial statements for
years ending 2007 and 2008.

Audit partner David McClean was fined GBP29,000, discounted for
settlement to GBP20,000, and also given a reprimand, Belfast
Telegraph discloses.

Almost 10,000 Presbyterians lost their savings when the PMS was
forced into administration in November 2008, Belfast Telegraph
recounts.  A rescue package underwritten by the UK Government and
the Stormont Executive was agreed in 2011, Belfast Telegraph

Three years ago, the Department of Enterprise, Trade and
Investment was accused of failing to properly scrutinize the
activities of the PMS before it collapsed, Belfast Telegraph

The Presbyterian Mutual Society, also known as Presbyterian
Mutual is a Belfast-based mutual society with around 9,500
investors, most of whom are members of the Presbyterian Church in

TULLOW OIL: Moody's Confirms B2 CFR, Outlook Negative
Moody's Investors Service has concluded rating reviews on three
European exploration and production (E&P) companies.  Moody's
confirmed the B2 corporate family rating (CFR), B2-PD probability
of default rating (PDR) and Caa1 senior notes rating of Tullow
Oil plc and the B3 corporate family rating (CFR), B3-PD
probability of default rating (PDR) and Caa2 senior global note
rating of Ithaca Energy Inc., and downgraded EnQuest plc's
corporate family rating (CFR) and probability of default rating
(PDR) by one notch to Caa1/Caa1-PD from B3/B3-PD, while
confirming Caa2 ratings on its senior global notes.  Moody's
assigned negative outlooks to all ratings.  These actions
conclude the rating reviews begun on
Jan. 22, 2016.

On Jan. 22, 2016, Moody's placed globally all oil companies rated
between A1 and B3 on review for downgrade.  This reflected the
substantial drop of oil prices and the continued oversupply in
the global oil markets.  Moody's lowered its oil price estimates
on Jan. 21, 2016, and assumes Brent oil price to average $33/boe
in 2016 and $38/boe in 2017, with a slow recovery for oil prices
over the next several years.  The drop in energy prices and
corresponding capital markets concerns will also raise financing
costs and increase refinancing risks for E&P companies.

The drop in oil prices and weak natural gas prices have caused a
fundamental change in the energy industry, and its ability to
generate cash flow has fallen substantially.  Moody's believes
this condition will persist for several years.  As a result,
Moody's is recalibrating the ratings of many energy companies
globally to reflect this industry shift. However, the impact of
the drop in oil prices and low natural gas prices will vary
substantially from issuer to issuer.  Therefore, Moody's
confirmed the current ratings of some companies, while
downgrading others by multiple notches.

For the three European E&P companies, cash flow declines in
tandem with oil and natural gas prices have weakened credit
metrics and put pressure on cash flow generation in 2016/2017,
with all three companies executing on relatively large
development projects.  The expansions are being funded by drawing
on respective bank facilities, making liquidity and availability
of bank funding key credit drivers in the next 12-18 months.
Other important credit considerations include expected decline in
capex commitments and timely execution on their key development
projects, where the quick ramp up of production and execution on
initiatives to reduce operating costs will need to take place in
2016/2017, as well as the varied degree of protection to cash
flows offered by the existing hedging arrangements.

                           RATINGS RATIONALE

Tullow Oil plc

Moody's Investors Service has confirmed B2 CFR and B2-PD
probability of default rating (PDR) of Tullow Oil plc.  The
ratings on its USD650 million 2020 and USD650 million 2022 senior
global notes were confirmed at Caa1.  The outlook on all Tullow's
ratings is negative.

This action takes into account Moody's updated oil price
assumptions for 2016/2017 and reflects the company's high
leverage that Moody's expects to peak in mid-2016, with Moody's
adjusted gross leverage exceeding 5.5x.  In the middle of this
year, the company is set to bring on stream a large project off-
shore Ghana (TEN), which will materially add to Tullow's
significant low cost production base and reserves position.  A
planned reduction in capex post first oil from the TEN
development should allow Tullow to return to positive FCF
generation in 2017 and will help to accelerate the deleveraging.
Tullow also maintains significant hedge positions for 2016-2018,
which limit the effect of lower prices on its cash flows and will
support deleveraging.

Tullow reported $356 million in cash at the end of 2015, had full
availability under its $1 billion 2017 corporate facility, and
approximately $1 billion available under its $3.7 billion RBL
facilities.  The rating assumes that the company will proactively
manage its covenant and refinancing profile in 2016, as the RBL
facility will start to amortise in 4Q 2016 and in 2017 when its
corporate facility is currently scheduled to mature.

Ithaca Energy Inc.

Moody's Investors Service confirmed Ithaca Energy Inc.'s B3 CFR,
its B3-PD probability of default rating, and the Caa2 rating on
its guaranteed senior global notes.  The rating outlook on all
ratings is negative.

The confirmation takes into account reduced capital and execution
risk as Ithaca has completed almost all of the development
spending on its key Greater Stella Area (GSA) project, with the
FPF-1 production platform in the commissioning stage and
production expected to come onstream in third quarter 2016.
Timely completion of the GSA project will be key to the company's
production and cash flow growth in 2016-2017.

The confirmation reflects an expected trend of lower debt levels
with debt/EBITDA to peak in the area of 4.5x in 2016, primarily
reflecting the impact of lower crude prices on cash flow.  Lower
capital spending in 2016 and 2107, and existing hedging on a
sizeable share of its production through mid-2017 at or above
$60/Brent, will support a return to FCF generation and debt
reduction in 2016 and beyond.

Ithaca's liquidity tightened under its RBL facility following it
borrowing base redetermination in late 2015, but remains adequate
with $138 million undrawn as of year-end 2015.  The company also
benefited from $60 million of new equity financing in late 2015
that reduced leverage and enhanced liquidity.  Moody's notes that
given the importance of the GSA development to the company's cash
flow profile, any further material delays in the start-up or
erosion in liquidity could result in a downgrade of Ithaca's

EnQuest plc

Moody's Investors Service has downgraded the CFR of EnQuest plc
(EnQuest) to Caa1 from B3 and probability of default rating (PDR)
to Caa1-PD from B3-PD.  The Caa2 rating on the company's 2022
senior global notes was confirmed.  The outlook on all ratings is

This action is primarily driven by the concern over EnQuest's
ability to maintain sufficient liquidity over the medium-term,
while investing in the strategic Kraken project in the North Sea
scheduled to come to production in 2017.  In spite of expected
growth in production, EnQuest will generate negative free cash
flows because of lower oil prices and transition to a largely
unhedged position in 2H 2016, with debt/EBITDA leverage peaking
in 2016 above 4x.  Sizable investments amid low price environment
will extend negative FCF generation in 2017, delay debt reduction
and pressure liquidity in the next 12-18 months, when expansion
will need to be funded by cash and available bank facilities.

The principal methodology used in these ratings was Global
Independent Exploration and Production Industry published in
December 2011.


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

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

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


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

Troubled Company Reporter-Europe is a daily newsletter co-
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Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA.
Valerie U. Pascual, Marites O. Claro, Rousel Elaine T. Fernandez,
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Copyright 2016.  All rights reserved.  ISSN 1529-2754.

This material is copyrighted and any commercial use, resale or
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Information contained herein is obtained from sources believed to
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