/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/160505.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, May 5, 2016, Vol. 17, No. 089 Headlines A Z E R B A I J A N AZERBAIJAN: Moody's Confirms Ba1 Bond Rating; Outlook Negative C Z E C H R E P U B L I C NEW WORLD: Winding Up Likely Following OKD's Insolvency Filing G E R M A N Y GERMAN PELLETS: Insolvency Proceedings Commenced I R E L A N D LYNAMS HOTEL: Receiver to Take Over After Dispute Resolved TABERNA EUROPE: Moody's Raises Rating on Cl. A1 Notes to Ba1 I T A L Y DIAPHORA 3: May 26 "Le Vele" Water Park Bid Deadline Set PORTO SAN ROCCO: May 25 Bid Submission Deadline Set N E T H E R L A N D S DRYDEN 44 EURO: Moody's Assigns (P)B2 Rating to Class F Notes R U S S I A STAVROPOL TERRITORY: Fitch Affirms BB Issuer Default Ratings S W E D E N HOIST KREDIT: Moody's Assigns Ba2 Issuer Rating, Outlook Pos. S W I T Z E R L A N D SAIRLINES LTD: May 9 Deadline on 4th Interim Payment Appeals Set U N I T E D K I N G D O M BEALES: Lynn Store Faces Closure Following CVA Deal BHS GROUP: Philip Green Faces Double Inquiry Following Collapse FH REALISATIONS: Business, Assets Put Up for Sale TATA STEEL UK: Prospective Buyers Submit Initial Bids ********* =================== A Z E R B A I J A N =================== AZERBAIJAN: Moody's Confirms Ba1 Bond Rating; Outlook Negative -------------------------------------------------------------- Moody's Investors Service has confirmed Azerbaijan's long-term issuer ratings and senior unsecured debt ratings at Ba1 and assigned a negative outlook. Concurrently, Moody's Investors Service has also confirmed Southern Gas Corridor's state- guaranteed senior unsecured debt rating at Ba1 and assigned a negative outlook. The rating action concludes the rating review for downgrade that was announced on Feb. 5, 2016. In Moody's view, the downgrade to Ba1 from Baa3 at the time of the initiation of the rating review on Feb. 5, 2016, captures appropriately the significant deterioration of Azerbaijan's credit profile in recent months. The steep decline in the oil price delivered a significant shock to the oil-reliant Azeri economy, resulting in a severe economic, currency and banking sector crisis and causing Azerbaijan's fiscal position and government debt metrics to deteriorate markedly over the past year. Set against that, the country's large stock of foreign currency assets held in the State Oil Fund of the Republic of Azerbaijan (SOFAZ), the country's sovereign wealth fund, helps cushion the economy and government balance sheet and gives Azerbaijan time to adjust to lower oil prices. The decision to assign a negative outlook essentially reflects the ongoing threat to Azerbaijan's credit profile from weakening economic strength amid a deepening recession. This is driven by falling economic activity in non-oil GDP sectors, heightened stress in the banking system, and the potential for economic dislocation from further depreciation in the exchange rate. Geopolitical event risks have also risen with the recent re- escalation of the Nagorno-Karabakh conflict. Azerbaijan's long-term and short-term foreign-currency bond and deposit ceilings remain unchanged at Ba1/NP and Ba2/NP, respectively. At the same time, the long-term local-currency bond and deposit country ceilings remain unchanged at Ba1. RATINGS RATIONALE RATIONALE FOR CONFIRMING THE Ba1 RATING In Moody's view, the downgrade undertaken in February adequately captures the severely negative impact of the oil price shock on Azerbaijan's economic and fiscal strength, set against the country's still substantial fiscal buffers and compared with regional and other oil-exporting peers. The sharp decline in oil prices has delivered a significant shock to Azerbaijan's credit profile, causing economic fundamentals to materially worsen. As oil and gas account for over 90% of the country's goods exports, Azerbaijan's real GDP growth rate decelerated materially to just 1.1% in 2015 (from 2.8% in 2014) and has since entered what looks likely to be a deep recession. Overall real GDP declined by around 3.5% Y-o-Y in March 2016, with economic activity in non-oil GDP sectors -- the backbone of Azerbaijan's strong growth performance in recent years -- contracting by around 5.7% Y-o-Y (compared to growth of 1.1% Y-o-Y in December and 9.2% Y-o-Y in June 2015). Per capita income has declined by roughly one third to around USD5,400 in 2015 (from USD8,000 in 2014) and is expected to decrease further this year. At the same time, the combination of a worsening fiscal position, declining nominal GDP and the fall in the local currency's value caused the government's debt burden to increase significantly in 2015 (given that its debt is largely denominated in foreign currency). The government's debt-to-GDP ratio rose to above 28% of GDP by the end of 2015 from a low 11% in 2014. Moody's projects that the ratio will level off at around 30% of GDP in 2016, assuming that a significant portion of the consolidated budget deficit of around 13% of GDP in 2016 will be covered by non-debt creating funding source, including the use of government cash reserves as well as SOFAZ's assets. However, Azerbaijan's gross debt burden could rise further should the government decide to partially fund the deficit through additional debt issues. Set against that, the government retains sizeable fiscal buffers that could help it absorb shocks, specifically SOFAZ's significant foreign currency assets. These fiscal buffers could help Azerbaijan cope with the challenges from the ongoing economic, currency and banking sector crises and allow it time to adjust to lower oil prices. As a result, the government has room to let fiscal deficits widen during periods of lower oil prices, economic recession and reduced fiscal revenues. SOFAZ's assets are predominantly invested in high-grade, liquid instruments. SOFAZ's foreign currency assets remain very large, despite declining by 9.5% to USD33.6 billion in 2015 (from USD37.1 billion in 2014). Levels are high not only relative to Azerbaijan's GDP and general government debt, but also compared to other oil exporting countries' sovereign wealth funds. SOFAZ's foreign assets account for roughly 100% of Azerbaijan's GDP forecast for 2016, underlining the government's very high shock absorption capacity. Consequently, Azerbaijan's sizeable sovereign wealth fund assets support its credit standing, largely offsetting the country's underlying fiscal vulnerabilities stemming from the government's heavy reliance on oil and gas revenues as well as a large share of foreign-currency government debt. RATIONALE FOR ASSIGNING A NEGATIVE OUTLOOK Moody's decision to assign a negative outlook on Azerbaijan's Ba1 government bond rating reflects the view that the economic situation, heightened stress in the banking system and geopolitical risks could continue to weigh on its credit profile. Azerbaijan's economic growth outlook remains weak. Moody's recently revised its 2016 growth forecast for Azerbaijan, expecting real GDP to shrink by 3.3%, compared to a previous forecast contraction of 0.7%, reflecting its expectation of a contraction in both the oil/gas and non-oil/gas GDP sectors It projects real economic activity to stay flat in 2017, rising only slowly thereafter. Moreover, risks to economic growth are tilted to the downside, given (a) the deteriorating position of Azerbaijan's banking sector which dampens the outlook for private investment, and (b) the adverse effects from devaluation and inflation on households' purchasing power and consumption. The combination of the economic contraction and currency devaluation (around 50% against the US dollar since mid-February 2015) are increasingly undermining the health of the domestic banking system. The Manat devaluation triggered a flight out of local currency deposits, led to a rise in banks' problem loans, and eroded capital buffers. Problem loans (overdue more than 90 days plus restructured loans) currently account for around 20% of system-wide gross loans, according to Moody's estimates. Even though the relatively small size of the Azeri banking sector limit the negative credit implications for the sovereign, the banks' weak credit standing add to the headwinds facing the economy and poses an additional threat to the government's balance sheet, as the banking system may require additional financial support. The largest bank in the country, state-owned International Bank of Azerbaijan (IBA; deposit ratings Ba3 stable, BCA b3), benefits from financial support from the state. Specifically, IBA's credit standing was supported in 2015 by the transfer of problematic assets totaling Manat 3.0 billion (around 5.5% of GDP in 2015) to the state non-credit organization Aqrakredit, which issued bonds in the same amount guaranteed by the state and purchased by the central bank. The bank anticipates additional bad assets transfer and capital injection of Manat 500 million from the state in 2016, which will further improve its capitalization. Finally, recent military clashes along the contact line of the disputed territory of Nagorno-Karabakh underlines elevated geopolitical event risks that -- if intensifying -- could lead to an additional weakening of economic and fiscal fundamentals via negative confidence effects on private consumption, foreign direct investment and hence economic growth and the government's budgetary position. WHAT COULD MOVE THE RATING UP/DOWN Although unlikely in the foreseeable future, upward pressure on Azerbaijan's government bond ratings could follow significant improvements in the country's institutional strength, evidence of sustained economic diversification and/or a decrease in geopolitical risks. A more rapid-than-expected increase in the oil price is unlikely to bring about a reversal in the rating trajectory unless accompanied by the rebuilding of fiscal buffers and a higher level of economic diversification, given the uncertainty surrounding whether any such rise in oil prices could be sustained. Evidence of credit-supportive institutional strength, most likely through the emergence of a clear, credible fiscal and economy policy response which offers the prospect of containing the deterioration of the fiscal balance and fiscal buffers, while returning the economy quickly to growth, could sustain the rating at its current level. Conversely, a further sustained fall in the price of oil, continued capital outflows and/or pressure on the exchange rate and/or foreign currency assets, a further marked worsening in the fiscal balance for which there was no clear reversal, and/or further stress in/support for the banking system would exert downward pressure on the rating. Deterioration in the domestic or regional political environment resulting in disruptions to oil production and/or foreign investments in the economy would also be highly credit negative. Prompted by the factors described above, the publication of this credit rating action occurs on a date that deviates from the previously scheduled release date in the sovereign release calendar. GDP per capita (PPP basis, US$): 17,762 (2014 Actual) (also known as Per Capita Income) Real GDP growth (% change): 1.1% (2015 Actual) (also known as GDP Growth) Inflation Rate (CPI, % change Dec/Dec): 7.8% (2015 Actual) Gen. Gov. Financial Balance/GDP: -4.8% (2015 Actual) (also known as Fiscal Balance) Current Account Balance/GDP: 13.6% (2014 Actual) (also known as External Balance) External debt/GDP: 15.5 (2014 Actual, according to World Bank data) Level of economic development: Low level of economic resilience Default history: No default events (on bonds or loans) have been recorded since 1983. On April 26, 2016, a rating committee was called to discuss the rating of the Azerbaijan, Government of. The main points raised during the discussion were: The issuer's economic fundamentals, including its economic strength, have not materially decreased. The issuer's institutional strength/ framework, have not materially changed. The issuer's governance and/or management, have not materially changed. The issuer's fiscal or financial strength, including its debt profile, has materially decreased. The issuer has become increasingly susceptible to event risks. The principal methodology used in these ratings was Sovereign Bond Ratings published in December 2015. The weighting of all rating factors is described in the methodology used in this credit rating action, if applicable. =========================== C Z E C H R E P U B L I C =========================== NEW WORLD: Winding Up Likely Following OKD's Insolvency Filing -------------------------------------------------------------- Krystof Chamonikolas at Bloomberg News reports that New World Resources Plc, which entered the Prague Stock Exchange eight years ago as the largest Czech equity offering ever, may become the country's biggest corporate failure in at least a decade. The mining company, controlled by a group of investors including Ashmore Investment Management Ltd., said on May 4 it will probably be "wound up or broken up in an orderly manner" as a result of an insolvency filing by its key asset, OKD AS, Bloomberg relates. The unit, as cited by Bloomberg, said a day earlier it had enough cash to pay May wages but couldn't meet any obligations to over 650 creditors, including NWR, as its debt was more than twice the value of its assets. NWR stock was suspended on the London Stock Exchange on May 4 and the company requested the same from the Prague and Warsaw bourses, Bloomberg recounts. Winding up or breaking up its business as a result of OKD's insolvency would mean "very minimal or no returns" to NWR shareholders, Bloomberg relays, citing a regulatory statement. NWR is the latest victim of global overcapacity, a slowing Chinese economy, tighter environmental regulation and lower natural gas prices that have made coal mining unprofitable in many places, Bloomberg notes. New World Resources Plc is the largest Czech producer of coking coal. ============= G E R M A N Y ============= GERMAN PELLETS: Insolvency Proceedings Commenced ------------------------------------------------ IHB reports that the insolvency proceedings on the bankrupt German Pellets Group have been opened on May 1. Bettina Schmudde from White & Case-Hamburg was appointed insolvency administrator, IHB discloses. Ms. Schmudde has closed contracts with investors that shall guarantee the continuation of parts of the German Pellets Group, IHB relates. The German Pellets mill in Wismar has been acquired by Metropolitan Equity Partners, LLC, New York, IHB recounts. Until the contracts come into effect, operations are continued by the insolvency administrator on an interim basis, IHB notes. Negotiation for the fourth German Pellets mill in Germany are ongoing, IHB relays. Ms. Schmudde wants to reach an agreement with one of several interested parties by end of May, IHB states. German Pellets is a production company based in Wismar, Germany. The company produces various kinds of wood pellets for pellet heating and pellet ovens and animal hygiene products for horses, large and small animals. ============= I R E L A N D ============= LYNAMS HOTEL: Receiver to Take Over After Dispute Resolved ---------------------------------------------------------- Aodhan O'Faolain at The Irish Times reports that a dispute between the operator of a Dublin city center hotel and a National Asset Management Agency-appointed receiver over possession of the premises has been resolved. As part of the arrangement, Lynams Hotel, Upper O'Connell Street, will be handed over to the receiver on Aug. 1, when the 21 staff employed there will also be made redundant, Mr. Justice Paul Gilligan was told on April 28, The Irish Times relates. The hotel has been run by Theresa Andreucetti since 2008 under a lease with the landlords, The Irish Times discloses. Earlier this month, she secured a temporary High Court injunction allowing her retain possession of the premises, The Irish Times recounts. She went to court after agents for receiver Aiden Murphy, appointed by NAMA last September over assets of the landlords, entered the hotel and told staff he was taking possession because Ms. Andreucetti had failed to pay some EUR528,000 in arrears of rent, The Irish Times relays. When seeking the injunction, the hotelier denied rent arrears were owed and contended the receiver was not entitled to possession, according to The Irish Times. The matter returned before the High Court on April 28 when Mr. Justice Gilligan was informed the parties had reached an agreement, The Irish Times discloses. That involved Ms. Andreucetti giving an undertaking she would, subject to a three-month stay, give vacant possession of the hotel to the receiver, The Irish Times notes. As part of the deal, Ms. Andreucetti will continue to operate the hotel for the next three months, The Irish Times states. TABERNA EUROPE: Moody's Raises Rating on Cl. A1 Notes to Ba1 ------------------------------------------------------------ Moody's Investors Service has upgraded the rating on these notes issued by Taberna Europe CDO II P.L.C.: EUR588,000,000 Class A1 Senior Floating Rate Notes Due 2038 (current balance of EUR329,445,884.53), Upgraded to Ba1 (sf); previously on March 7, 2014, Downgraded to Ba2 (sf) Taberna Europe CDO II P.L.C., issued in September, 2007, is a collateralized debt obligation backed primarily by a portfolio of European REIT trust preferred securities (TruPS). RATINGS RATIONALE The rating action is primarily a result of deleveraging of the Class A1 notes, an increase in the transaction's overcollateralization (OC) ratios, and the improvement in the credit quality of the underlying portfolio since July 2015. The Class A1 notes have paid down by approximately 18% or $74.1 million since July 2015, using principal proceeds from the redemption of underlying assets. Based on Moody's calculations, the Class A1 OC ratio has improved to 138.97% from 131.79% in July 2015. The Class A1 notes will continue to benefit from the use of proceeds from redemptions of any assets in the collateral pool. The deal has also benefited from improvement in the credit quality of the underlying portfolio. According to Moody's calculations, the weighted average rating factor (WARF) improved to 2479 from 2801 in July 2015. These rating actions also reflect a correction to Moody's modeling. In the March 2014 rating action, two swaps with a total notional amount of EUR31.4 million were not modeled. The error has now been corrected, and today's rating actions reflect this change. The key model inputs Moody's used in its analysis, such as par, weighted average rating factor, and weighted average recovery rate, are based on its 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 of EUR457.8 million, defaulted and deferring par of EUR144.3 million, a weighted average default probability of 21.45% (implying a WARF of 2479), and a weighted average recovery rate upon default of 14.7%. In addition to the quantitative factors Moody's explicitly models, qualitative factors are part of rating committee considerations. Moody's considers the structural protections in the transaction, the risk of an event of default, recent deal performance under current market conditions, the legal environment and specific documentation features. All information available to rating committees, including macroeconomic forecasts, inputs 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. Methodology Underlying the Rating Action The principal methodology used in this rating was "Moody's Approach to Rating TruPS CDOs," published in June 2014. Factors that Would Lead to an Upgrade or Downgrade of the Rating: This transaction is subject to a number of factors and circumstances that could lead to either an upgrade or downgrade of the ratings, as described below: 1) Macroeconomic uncertainty: TruPS CDOs performance could be negatively affected by uncertainty about credit conditions in the general economy. 2) Portfolio credit risk: Credit performance of the assets collateralizing the transaction that is better than Moody's current expectations could have a positive impact on the transaction's performance. Conversely, asset credit performance weaker than Moody's current expectations could have adverse consequences on the transaction's performance. 3) Deleveraging: One source of uncertainty in this transaction is whether deleveraging from unscheduled principal proceeds and excess interest proceeds will continue and at what pace. Note repayments that are faster than Moody's current expectations could have a positive impact on the notes' ratings, beginning with the notes with the highest payment priority. 4) Exposure to non-publicly rated assets: The deal contains a large number of securities whose default probability Moody's assesses through credit scores derived using RiskCalc or credit estimates. Moody's evaluates the sensitivity of the ratings of the notes to the volatility of these credit assessments. Loss and Cash Flow Analysis: Moody's applied a Monte Carlo simulation framework in Moody's CDOROM to model the loss distribution for TruPS CDOs. The simulated defaults and recoveries for each of the Monte Carlo scenarios defined the reference pool's loss distribution. Moody's then used the loss distribution as an input in its CDOEdge cash flow model. The portfolio of this CDO contains primarily trust preferred securities issued by small to medium sized European REIT companies that Moody's does not rate publicly. For REIT TruPS that do not have public ratings, Moody's REIT group assesses their credit quality using the REIT firms' annual financials. In addition to the base case analysis, Moody's also conducted sensitivity analyses to test the impact of a number of default probabilities on the rated notes relative to the base case modeling results, which may be different from the current public ratings of the notes. Below is a summary of the impact of different default probabilities (expressed in terms of WARF) on all of the rated notes (by the difference in the number of notches versus the current model output, for which a positive difference corresponds to lower expected loss): Assuming a two-notch upgrade to assets with below-investment grade ratings or rating estimates (WARF of 1524) Class A1: +3 Assuming a two-notch downgrade to assets with below-investment grade ratings or rating estimates (WARF of 3384) Class A1: -1 ========= I T A L Y ========= DIAPHORA 3: May 26 "Le Vele" Water Park Bid Deadline Set -------------------------------------------------------- Diaphora 3 Fund, in liquidation pursuant to Art. 57 TUF, is putting up for sale "Le Vele", a water park situated in the municipalities of San Gervasio Bresciano, Alfianello and Milzano (BS), Via delle Corti no. 77 - San Gervasio Bresciano - Casacce, comprising properties and plants, part of the property complex as described in the appraisal reported dated March 23, 2016, drawn up by Surveyor Rita Stancari. Starting price: EUR4,000,000 in addition to applicable tax. Bid deadline: 12:00 a.m. on May 26, 2016, bids to be submitted at the office of Notary Pietro Barziza in Desenzano del Garda (BS), Piazza Duomo no. 17. Date of sale: 4:30 p.m. on May 27, 2016, at the office of the Notary. Details and procedures and sales regulations are available at www.liquidagest.it PORTO SAN ROCCO: May 25 Bid Submission Deadline Set --------------------------------------------------- The official receiver of Bankr. Porto San Rocco s.r.l., in liquidation, Paolo D'Agostini, is selling the company's property complex, in addition to the fittings, located in Muggia (Trieste), specifically in the Porto San Rocco area, indicated as follows: no. 305 property units, no. 117 of which used as dwellings -- tourist accommodations, several of which furnished, no. 11 business premises, no. 22 cellars, no. 152 roofed parking spaces and no. 3 unroofed parking spaces, spread over 13 UMIs (Minimal Units of Intervention), divided into 7 apartment buildings, named from letter A to letter H, except for letter E. The complex is sold in accordance with art. 107 of the bankruptcy law, using a competitive bidding procedure, through private bids at the starting price of EUR13,183,000, EUR10,807,099 of which relating to the housing units -- tourist accommodations, EUR2,360,901 to the non-residential property units, and EUR15,000 to the existing fittings partly of the housing units, it being specified that the above sale rules out any possibility of the sale of a company or business unit, as a whole and not on a per unit of measure basis, all as in fact and in law, as resulting in the 20-year report drawn up by notary Alfonso Colucci of Rome, and in the report drawn up by the court- appointed expert of the Bankruptcy, surveyor Sergio Cruciani. The complex is sold unencumbered by mortgages and other adverse entries and registrations, with the charges thereof borne by the successful bidder. The bid should be enclosed in a sealed envelope and submitted by 11:00 a.m. on May 25, 2016, at the office of notary Alfonso Colucci, in Via Emanuele Gianturco no. 1 Rome. The sealed bid should also include a bank draft/bank drafts made payable to Avv. Paolo D'Agostini, official receiver of Bankr. Porto San Rocco s.r.l. (no. 189/15 Court of Rome), equal to 10% of the bid amount, as a deposit, on pain of nullity. The envelopes shall be opened on the same day at 12:00 a.m.; should more than one envelope containing the purchase bid be submitted, the tender among the bidders shall take place immediately before notary Alfonso Colucci; in the tender, if any, the bid shall start from a minimum of EUR100,000. The conditions and procedures for the submission of the bids, for the tender, if any, among the bidders, and for the sale, are indicated in the Supplement to the winding-up scheme dated April 4, 2016, approved by resolution of the Creditors' Committee on March 23, 2016. The documents are made available to the interested parties on the website of the procedure, www.fallportosanrocco.it; information may be requested from the official receiver Paolo D' Agostini, via Girolamo da Carpi no. 6, Rome, tel. 06-3227850, or from Claudio Santini, tel 06-80693292. ===================== N E T H E R L A N D S ===================== DRYDEN 44 EURO: Moody's Assigns (P)B2 Rating to Class F Notes ------------------------------------------------------------- Moody's Investors Service announced that it has assigned these provisional ratings to notes to be issued by Dryden 44 Euro CLO 2015 B.V.: EUR232,400,000 Class A-1 Senior Secured Floating Rate Notes due 2030, Assigned (P)Aaa (sf) EUR12,300,000 Class A-2 Senior Secured Fixed Rate Notes due 2030, Assigned (P)Aaa (sf) EUR36,000,000 Class B-1 Senior Secured Floating Rate Notes due 2030, Assigned (P)Aa2 (sf) EUR7,200,000 Class B-2 Senior Secured Fixed Rate Notes due 2030, Assigned (P)Aa2 (sf) EUR23,000,000 Class C Mezzanine Secured Deferrable Floating Rate Notes due 2030, Assigned (P)A2 (sf) EUR18,700,000 Class D Mezzanine Secured Deferrable Floating Rate Notes due 2030, Assigned (P)Baa2 (sf) EUR28,100,000 Class E Mezzanine Secured Deferrable Floating Rate Notes due 2030, Assigned (P)Ba2 (sf) EUR11,800,000 Class F Mezzanine Secured Deferrable Floating Rate Notes due 2030, Assigned (P)B2 (sf) Moody's issues provisional ratings in advance of the final sale of financial instruments, but these ratings only represent Moody's preliminary credit opinions. Upon a conclusive review of a transaction and associated documentation, Moody's will endeavor to assign definitive ratings. A definitive rating (if any) may differ from a provisional rating. RATINGS RATIONALE Moody's provisional rating of the rated notes addresses the expected loss posed to noteholders by the legal final maturity of the notes in 2030. The provisional ratings reflect the risks due to defaults on the underlying portfolio of loans given the characteristics and eligibility criteria of the constituent assets, the relevant portfolio tests and covenants as well as the transaction's capital and legal structure. Furthermore, Moody's is of the opinion that the collateral manager, PGIM Limited ("Pramerica"), has sufficient experience and operational capacity and is capable of managing this CLO. Dryden 44 Euro CLO 2015 B.V. is a managed cash flow CLO. At least 90% of the portfolio must consist of senior secured loans and senior secured floating rate notes and up to 10% of the portfolio may consist of unsecured loans, second-lien loans, mezzanine obligations and high yield bonds. The bond bucket gives the flexibility to Dryden CLO to hold bonds if Volcker Rule is changed. The portfolio is expected to be 62% ramped up as of the closing date and to be comprised predominantly of corporate loans to obligors domiciled in Western Europe. Pramerica will manage the CLO. It will direct the selection, acquisition and disposition of collateral on behalf of the Issuer and may engage in trading activity, including discretionary trading, during the transaction's four-year reinvestment period. Thereafter, purchases are permitted using principal proceeds from unscheduled principal payments and proceeds from sales of credit risk and credit improved obligations, and are subject to certain restrictions. In addition to the eight classes of notes rated by Moody's, the Issuer will issue EUR43.4 mil. of subordinated notes, which will not be rated. The transaction incorporates interest and par coverage tests which, if triggered, divert interest and principal proceeds to pay down the notes in order of seniority. Factors that would lead to an upgrade or downgrade of the ratings: The rated notes' performance is subject to uncertainty. The notes' performance is sensitive to the performance of the underlying portfolio, which in turn depends on economic and credit conditions that may change. Pramerica's investment decisions and management of the transaction will also affect the notes' performance. Loss and Cash Flow Analysis: Moody's modeled the transaction using CDOEdge, a cash flow model based on the Binomial Expansion Technique, as described in Section 2.3 of the "Moody's Global Approach to Rating Collateralized Loan Obligations" rating methodology published in December 2015. The cash flow model evaluates all default scenarios that are then weighted considering the probabilities of the binomial distribution assumed for the portfolio default rate. In each default scenario, the corresponding loss for each class of notes is calculated given the incoming cash flows from the assets and the outgoing payments to third parties and noteholders. Therefore, the expected loss or EL for each tranche is the sum product of (i) the probability of occurrence of each default scenario and (ii) the loss derived from the cash flow model in each default scenario for each tranche. As such, Moody's encompasses the assessment of stressed scenarios. Moody's used these base-case modeling assumptions: Par amount: EUR 400,000,000 Diversity Score: 45 Weighted Average Rating Factor (WARF): 2800 Weighted Average Spread (WAS): 4.10% Weighted Average Recovery Rate (WARR): 41% Weighted Average Life (WAL): 8 years Moody's has analyzed the potential impact associated with sovereign related risk of peripheral European countries. As part of the base case, Moody's has addressed the potential exposure to obligors domiciled in countries with local currency country risk ceiling of A1 or below. For countries which are not member of the European Union, the foreign currency country risk ceiling applies at the same levels under this transaction. Following the effective date, and given the portfolio constraints and the current sovereign ratings in Europe, such exposure may not exceed 15% of the total portfolio. As a result and in conjunction with the current foreign government bond ratings of the eligible countries, as a worst case scenario, a maximum 15% of the pool would be domiciled in countries with A3 local or foreign currency country ceiling. The remainder of the pool will be domiciled in countries which currently have a local or foreign currency country ceiling of Aaa or Aa1 to Aa3. Given this portfolio composition, the model was run with different target par amounts depending on the target rating of each class as further described in the methodology. The portfolio haircuts are a function of the exposure size to peripheral countries and the target ratings of the rated notes and amount to 2.00% for the Class A-1 and A-2 notes, 1.25% for the Class B-1 and B-2 notes, 0.50% for the Class C and 0% for Classes D, E, and F. Stress Scenarios: Together with the set of modelling assumptions above, Moody's conducted additional sensitivity analysis, which was an important component in determining the provisional rating assigned to the rated notes. This sensitivity analysis includes increased default probability relative to the base case. Below is a summary of the impact of an increase in default probability (expressed in terms of WARF level) on each of the rated notes (shown in terms of the number of notch difference versus the current model output, whereby a negative difference corresponds to higher expected losses), holding all other factors equal: Percentage Change in WARF: WARF + 15% (to 3220 from 2800) Ratings Impact in Rating Notches: Class A-1 Senior Secured Floating Rate Notes: 0 Class A-2 Senior Secured Fixed Rate Notes: 0 Class B-1 Senior Secured Floating Rate Notes: -2 Class B-2 Senior Secured Fixed Rate Notes: -2 Class C Mezzanine Secured Deferrable Floating Rate Notes: -2 Class D Mezzanine Secured Deferrable Floating Rate Notes: -2 Class E Mezzanine Secured Deferrable Floating Rate Notes: -3 Class F Mezzanine Secured Deferrable Floating Rate Notes: -1 Percentage Change in WARF: WARF +30% (to 3640 from 2800) Ratings Impact in Rating Notches: Class A-1 Senior Secured Floating Rate Notes: -1 Class A-2 Senior Secured Fixed Rate Notes: -1 Class B-1 Senior Secured Floating Rate Notes: -3 Class B-2 Senior Secured Fixed Rate Notes: -3 Class C Mezzanine Secured Deferrable Floating Rate Notes: -4 Class D Mezzanine Secured Deferrable Floating Rate Notes: -3 Class E Mezzanine Secured Deferrable Floating Rate Notes: -2 Class F Mezzanine Secured Deferrable Floating Rate Notes: -3 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. =========== R U S S I A =========== STAVROPOL TERRITORY: Fitch Affirms BB Issuer Default Ratings ------------------------------------------------------------ Fitch Ratings has affirmed Russian Stavropol Region's Long-Term Foreign and Local Currency Issuer Default Ratings (IDRs) at 'BB' and National Long-Term rating at 'AA-(rus)' with Stable Outlooks. The Short-Term Foreign Currency IDR has been affirmed at 'B'. The region's outstanding senior unsecured domestic bonds have also been affirmed at 'BB' and 'AA-(rus)'. The affirmation reflects Fitch's unchanged base case scenario of Stavropol region's growing direct risk and persistent budget deficit being balanced against a satisfactory operating performance. KEY RATING DRIVERS The ratings reflect Stavropol's sustainable operating performance, persistent budget deficit, driven by capex, and moderate, albeit growing, direct risk. The ratings also factor in the region's modest economic indicators, a weak institutional framework for Russian sub-nationals and a recessionary national economy. Fitch projects the region's operating balance to consolidate at 6%-8% of operating revenue in 2016-2018, slightly up from 5% in 2015, driven by a moderate recovery of operating revenue. Stavropol's operating revenue declined 0.8% in 2015, due to large tax return claims on the region's budget from local corporates. "We do not expect this to continue over the medium term and project annual 5%-6% tax growth in 2016-2018. Fitch forecasts direct risk to grow steadily towards 65% of current revenue by end-2018, from 49% in 2015, due to the region's budget deficit continuing over the medium term. We project deficit before debt variation at 8%-10% of total revenue (2015: 12%) as the region follows an investment-intensive budget (mostly in social infrastructure), including maintenance capex at 17% of total expenditure (2015: 19%), above the 'BB' median of 14%. We expect Stavropol to continue to benefit from low-cost federal government loans. In 2015, Stavropol contracted RUB6.2 billion federal budget loans and will take on an additional RUB5.1 billion such loans in 2016. This will increase the share of federal budget loans to 33% by end-2016 from 18% in 2014. Fitch views the improved debt structure as a supportive rating factor given high interest rate volatility in the Russian debt capital market. We expect the region will maintain low interest payments at 2% of operating revenue over the medium term (2015: 2%). As with most Russian sub-nationals, Stavropol is exposed to high refinancing risk that makes it dependent on access to financial markets. About 70% of the region's direct risk is due in 2016-2017. Stavropol faces a repayment of RUB11.5 billion maturities by end-2016. Fitch expects the region to cover its immediate refinancing needs with its undrawn RUB8.3bn credit lines and a RUB5.1 billion federal budget loan. We also expect the region to have reasonable access to domestic debt capital markets, with little problem in refinancing maturing debt over the medium term. Russia's institutional framework for sub-nationals is a constraining factor on the region's ratings. Frequent changes in both the allocation of revenue sources and the assignment of expenditure responsibilities between the tiers of government limit Stavropol's forecasting ability and negatively affect the region's strategic planning, and debt and investment management The region's administration projects the local economy to return to 3%-4% annual growth in 2016-2018, although this could be weighed down by an expected 1.5% decline in national GDP in 2016. Stavropol's economy is less dependent than the wider Russian economy on the external environment, which can prove volatile. In 2015, the region's gross regional product (GRP) declined 1.2% (2014: up 4.3%), based on preliminary estimates, while the broader Russian economy contracted 3.7%. Stavropol's socio- economic profile is historically weaker than that of the average Russian region and is dominated by agriculture, food processing and chemistry. Its GRP per capita was 67% of the national median in 2014," Fitch said. RATING SENSITIVITIES A sound operating balance at above 10% of operating revenue and debt coverage (2015: 17.4 years) in line with the average maturity profile (2015: 2.3 years) on a sustained basis would lead to an upgrade. Weakening of the current balance towards negligible levels on a sustained basis, coupled with an increase in direct risk above 60% of current revenue, would lead to a downgrade. =========== S W E D E N =========== HOIST KREDIT: Moody's Assigns Ba2 Issuer Rating, Outlook Pos. ------------------------------------------------------------- Moody's Investors Service has assigned Ba2/Not Prime long-term and short-term first time issuer ratings to Hoist Kredit AB (publ) -- Hoist. The outlook on the long-term issuer rating is positive. At the same time the rating agency has also assigned a ba3 baseline credit assessment (BCA) to the company. Moody's also assigns a Counterparty Risk Assessment (CR Assessment) of Baa3(cr)/Prime-3(cr) to the company. This is the first time Moody's has assigned credit ratings to Hoist. Hoist's baseline credit assessment (BCA) of ba3 is underpinned by a 'Strong' macro profile and sound capitalization, coupled with a solid retail deposit-based funding profile and sizeable liquidity portfolio. These strengths are counterbalanced by Hoist's monoline business model, the valuation and pricing risks associated with acquiring non-performing debt portfolios, as well as the concentration risk stemming from a limited number of suppliers. Hoist's Ba2 long-term issuer rating takes into account the company's ba3 BCA, in conjunction with Moody's view of a low loss given failure based on the protection provided to senior unsecured creditors by the group's senior and subordinated debt. RATINGS RATIONALE SOUND CAPITALISATION AND FUNDING PROFILE IMPROVE RISK POSITION Hoist's nominal leverage ratio, calculated as tangible common equity (TCE) on total assets, was 11.8% at the end of 2015, exceeding Swedish banks and rated debt purchasing peers. Moody's believes that the company's leverage ratio reflects the inherent risks of the debt purchasing industry. This is also evident by Hoist's high risk-weighted assets (RWA) density, calculated as RWA/total assets, of 85% as of end-2015, driven by risk-weights of 100% on non-performing loan portfolios (accounting for 63% of total assets). As a result, despite the high leverage ratio, Hoist's reported Common Equity Tier 1 ratio of 12.3% at end-2015 is relatively modest compared to other rated Swedish banks. Hoist has managed to remain attractive to savers and has continued to grow its retail deposit base to SEK12.8 billion at the end of 2015 from SEK11.0 billion the previous year, which Moody's considers a credit strength. As of end-2015, market funds stood at 7.2% of tangible banking assets. While customer deposit funding will remain the most important source of funding for Hoist, as they accounted for 89% of total funding at end- 2015, the rating agency expects the proportion of market funding to increase as the company plans to take advantage of favorable market conditions to grow its debt purchasing activities. LARGE LIQUIDITY PORTFOLIO PROVIDES FLEXIBILITY, BUT WEIGHS ON PROFITABILITY As a deposit taking entity with liquidity requirements similar to regular banks, Hoist has to hold a large stock of liquid assets, as prescribed by regulators. However, the company does not have the same regulatory status as a bank and, as such, does not have access to central bank liquidity. As a result, Hoist has built up a significant liquidity portfolio mainly containing high- quality treasury bills and treasury bonds, adding up to SEK5.2 billion as of end-2015 or 30.4% of tangible banking assets. In Moody's view, the large amount of liquid assets held on the balance sheet is a key credit strength for the company, giving Hoist the flexibility to acquire smaller debt portfolios without seeking additional funding or increasing leverage, and positioning the company well to withstand stressed funding conditions. Moody's notes that the low-yielding liquidity portfolio does weigh down the company's profitability. Compared with other debt collectors, Hoist is less profitable in terms of return on assets (net income to tangible assets was 1.3% at end-2015), but shows better earnings stability (pre-tax income coefficient of variation over the last three years was 31% compared to 70% average for rated peers). HOIST'S BCA IS SUPPORTED BY A 'STRONG' MACRO PROFILE Hoist's operating environment is primarily influenced by developments in the markets in which it acquires debt portfolios, with significant exposures to UK and Germany, countries with a 'Very Strong-' macro profile, accounting for 49% of the company's geographical exposures at end-2015. At the same time, Hoist has exposures in several countries with weaker macro profiles, such as Italy ('Moderate+') and Poland ('Strong-'); this drives the overall macro profile down to Strong+. Moody's further adjusts Hoist's macro profile based on the expectation that the company will acquire debt in other geographies with a weaker or more volatile operating environment, resulting in a 'Strong' macro profile. SOLID AND DIVERSIFIED MARKET POSITION IN THE EUROPEAN DEBT PURCHASING BUSINESS, BUT LIMITED PRODUCT OFFERING CONSTRAINS THE CREDIT ASSESSMENT With SEK19.4 billion in estimated remaining collections (ERC) over the next 120 months and SEK4.4 billion acquired portfolios in 2015, Hoist is one of the largest debt purchasers in Europe. The company acquires debt in eight countries across the continent with plans to expand into new markets over the coming years. Hoist's debt purchasing business primarily focuses on the collection and acquisition of financial services' non-performing unsecured consumer receivables. Despite its strengthening market position and evolving business model, Hoist's credit rating is constrained by the company's monoline business activities. The majority of the firm's revenues are generated by its debt purchasing businesses (90% in 2015) and is supplemented by income from debt collection and other sources (10% of revenues in 2015). STRONG TRACK RECORD AS DEBT PURCHASER, BUT ACQUIRED NON- PERFORMING CONSUMER LOAN PORTFOLIOS ARE INHERENTLY RISKY The receivables that Hoist acquires are, or have been, in arrears and therefore are, in Moody's view, speculative in nature. In addition to this, Moody's notes three key risks: (i) model risk in relation to the valuation and pricing of its purchased receivables; (ii) concentration risk relating to suppliers (i.e. debt originators/vendors); and (iii) event risk arising from potential litigation or legislative actions. Mitigating factors include the company's track record of accurately estimating the collections and the fact that the portfolios are acquired at substantially below the principal value, so that a large proportion of the debts is already written off. Hoist has developed a robust database, which has contributed to it achieving a high level of pricing accuracy over the last twenty years. Pricing of receivables is based on a comprehensive modeling and analytical approach while the portfolio of receivables purchased remains extremely granular. Notwithstanding this, the continued successful operating performance of the business is dependent upon this accuracy, with material mispricing of purchased portfolios potentially leading to underperformance or even losses. While purchased receivables are extremely granular in terms of its customer accounts, Hoist has a level of concentration relating to its suppliers. Moody's recognizes that this supplier concentration is common to debt purchasing companies in Europe, given the limited number of debt originators that have the scale and financial and IT capabilities to sell non-performing loans in the markets. Mitigating this risk, Hoist operates across a variety of geographies, reducing its relative exposure to country-specific factors. RATIONALE FOR THE LONG-TERM ISSUER RATING Hoist is domiciled in Sweden, a jurisdiction subject to the EU Bank Resolution and Recovery Directive (BRRD), which Moody's considers to be an Operational Resolution Regime. Moody's applies its Advanced Loss Given Failure (LGF) analysis to Hoist, since it is a regulated credit market company, not exempted from BRRD. Moody's assumes residual TCE of 3% and losses post-failure of 8% of tangible banking assets, a 5% run-off in preferred deposits, and assigns a 25% probability to deposits being preferred to senior unsecured debt. These are in line with Moody's standard assumptions. Particular to Hoist, Moody's assumes that Hoist does not source deposits considered junior, relative to the standard assumption of 26% of total deposits, due to the company's retail-oriented deposit base. Based upon the above, Moody's considers that Hoist's senior unsecured debt is likely to face low loss-given failure, due to the loss absorption provided by subordinated debt. This results in a Preliminary Rating Assessment (PRA) of ba2 for senior debt, one notch above the BCA. Since Moody's considers the probability of government support for Hoist's senior liabilities to be low, the rating does not incorporate any uplift from government support, and the final issuer rating is therefore positioned at Ba2. RATIONALE FOR THE COUNTERPARTY RISK ASSEMENTS As part of today's rating action, Moody's also assigned a CR Assessment of Baa3(cr)/Prime-3(cr), three notches above the BCA of ba3. The CR Assessment is driven by the banks' BCA and by the considerable amount of subordinated instruments likely to shield counterparty obligations from losses. Moody's CR Assessment is an opinion of how counterparty obligations are likely to be treated if a company fails and is distinct from debt and deposit ratings, in that it: (1) Considers only the risk of default rather than the likelihood of default and the expected financial loss suffered in the event of default; and (2) applies to counterparty obligations and contractual commitments rather than debt or deposit instruments. The CR Assessment is an opinion of the counterparty risk related to a bank's covered bonds, contractual performance obligations (servicing), derivatives (e.g., swaps), letters of credit, guarantees and liquidity facilities. RATIONALE FOR THE POSITIVE OUTLOOK The rating outlook is positive, reflecting Moody's expectation that the protection to senior unsecured debt holders offered by Hoist's liability structure will increase, providing upward rating pressure through the rating agency's LGF analysis. WHAT COULD CHANGE THE RATINGS UP/DOWN As signaled by the positive rating outlook, Hoist's issuer rating could be upgraded if the company were to issue a significant amount of debt, reducing the loss-given-failure of senior unsecured obligations. Hoist's BCA could be upgraded if the company: (i) significantly improves its profitability on a sustained basis without increasing earnings volatility; (ii) increases capital targets and demonstrates ability to maintain high capital levels; and/or (3) diversifies its business model. The company's BCA could be downgraded if: (i) Hoist materially increases its market funding reliance; (ii) the company experiences a protracted decrease in profitability or in its solvency ratios; and/or (iii) the rating agency's assessment of Hoist's asset risk deteriorates. A downward movement in Hoist's BCA would likely result in a downgrade of all ratings. PRINCIPAL METHODOLOGY The principal methodology used in these ratings was Banks published in January 2016. LIST OF ASSIGNED RATINGS Assignments: Adjusted Baseline Credit Assessment, assigned ba3 Baseline Credit Assessment, assigned ba3 Long-term Counterparty Risk Assessment, assigned Baa3(cr) Short-term Counterparty Risk Assessment, assigned P-3(cr) Long-term Issuer Ratings, assigned Ba2 Positive Short-term Issuer Ratings, assigned NP ===================== S W I T Z E R L A N D ===================== SAIRLINES LTD: May 9 Deadline on 4th Interim Payment Appeals Set ---------------------------------------------------------------- The provisional distribution list for the fourth interest payment that has been drawn up in the debt restructuring proceedings with assignment of assets concerning SAirLines Ltd. in debt restructuring liquidation, Hirschengraben 84, 8001 Zurich, will be open for inspection by the creditors concerned between April 27, 2016 and May 9, 2016, at the offices of the liquidator, Karl Wuthrich, attorney-at-law, Wenger Plattner, Seestrasse 39, Goldbach Center, 8700 Kusnacht. For inspection, creditors are asked to call the hotline at +41(0)43 222 38 50 to arrange an appointment. Appeals against the provisional distribution list must be lodged with the District court of Zurich, supervisory authority for debt enforcement and bankruptcy, Wengistrasse 30, P.O. Box, 8026 Zurich, within 10 days of the list's publication, i.e. by May 9, 2016 (date of postmark of a Swiss post office). If no appeals are lodged, the fourth interim payment will be made as provided for in the provisional distribution list. =========================== U N I T E D K I N G D O M =========================== BEALES: Lynn Store Faces Closure Following CVA Deal --------------------------------------------------- Lynn News reports that hopes are high to find a new tenant for Beales, a prominent Lynn town centre shop, when a retailer departs later this year. Shockwaves were sent around the town when Beales announced it would be closing its Broad Street store, Lynn News relays. No date has been announced for the closure but the firm says it will not be renewing the lease, which runs out in December, Lynn News notes. A total of 38 people are employed at the store, Lynn News discloses. Earlier this year, the Beales Department Store group announced plans to seek a Company Voluntary Arrangement (CVA), to renegotiate leases, which it claimed were no longer sustainable, Lynn News recounts. Beales is a Bournemouth-based department store chain. BHS GROUP: Philip Green Faces Double Inquiry Following Collapse --------------------------------------------------------------- Murad Ahmed, Josephine Cumbo and Jonathan Ford at The Financial Times report that Sir Philip Green faces a double inquisition by MPs in response to the collapse of BHS, as the retail magnate comes under increasing pressure to offer hundreds of millions more to fill the company's estimated GBP571 million pensions scheme deficit. The Arcadia chairman, who achieved billionaire status by creating a retail empire on the back of his GBP200 million purchase of British Home Stores in 2000, sold the high street chain for GBP1 last year, the FT relates. He faces a two-pronged probe from MPs over the circumstances of BHS's fall into administration this week, leaving 11,000 jobs across 164 stores at risk, the FT discloses. The work and pensions committee on April 29 confirmed the tycoon had been invited to give evidence to its probe into the BHS pension scheme, which is being absorbed into the industry-backed Pension Protection Fund (PPF), the FT relays. The business, innovation and skills committee is also expected to invite Sir Philip to give evidence to its inquiry into the failure of the retail chain, the FT states. The PPF has twice dismissed offers by Sir Philip and Retail Acquisitions, the little-known consortium to which he sold BHS last year, to help pay down the company's pension deficit, the FT recounts. As reported by the Troubled Company Reporter-Europe on April 26, 2016, Reuters related that BHS was placed into administration on April 25. Once a mainstay of the British high street, BHS has been in decline for years, unable to keep up with demand for fast fashion, online sales and improved customer services, Reuters disclosed. Saddled with over 1 billion pounds of debt, including the pension deficit, BHS failed to raise the additional funds it required, particularly from planned asset sales, to meet all its contractual payments, prompting the administration process, according to Reuters. BHS Group is a department store chain. The company employs 10,000 people and has 164 shops. FH REALISATIONS: Business, Assets Put Up for Sale ------------------------------------------------- The business and assets of F H Realisations Limited (formerly Froude Hofmann Limited), in administration, a globally renowed designer, manufacturer and supplier of an extensive range of engine testing sytems (dynamometers) in the automotive, gas turbine, marine and industrial markets, operated under license, have been put up for sale. The Worcester based business dates back to 1877 and has employed approximately 100 people in the recent past with an annual turnover of GBP14 million. The Worldwide intellectual property rights relating to the Froude brand are available subject to separate negotiation. For further details, please contact: Laura Tilson, Poppleton & Appleby 35 Ludgate Hill, Birmingham, B3 1EH Tel: 0121 200 2962 Fax: 0121 236 8340 E-mail: laurat@poppletonappleby.co.uk TATA STEEL UK: Prospective Buyers Submit Initial Bids ----------------------------------------------------- Michael Pooler at The Financial Times reports that prospective buyers of Tata Steel UK were scrambling to submit initial bids for the ailing business as the clock ran down on a deadline on May 3. The Indian group is seeking to withdraw from its UK operations after years of heavy losses, a move that has cast doubt over the future of British steelmaking and put 11,000 jobs at the factories at risk, with more than twice that number in danger at suppliers, the FT discloses. According to the FT, bidders include the commodities group Liberty House, led by Sanjeev Gupta, which on May 3 confirmed it had sent a letter of intent covering the assets. The group will be up against Excalibur, a management-led buyout team that wants to bring employees on board as investors and has also sent a letter of intent to acquire Tata's UK steel assets, the FT says. Tata's preference is to sell the business to a single buyer, the FT states. Unions and some managers fear that any deal to split the company would bring an end to raw steelmaking at the giant Port Talbot plant in south Wales, the FT notes. However, there is separate interest for Tata's specialist steels unit in South Yorkshire from a start-up company calling itself Albion Steel, composed of steel industry professionals, the FT relays. The deadline for preliminary offers -- known as non-binding letters of intent -- was 5:00 p.m. on May 3, though a person involved in the process said they expected further bids to arrive, with an expectation of interest from Chinese investors, according to the FT. Tata Steel is the UK's biggest steel company. ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers' public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than US$3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/booksto order any title today. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter-Europe is a daily newsletter co- published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA. Valerie U. Pascual, Marites O. Claro, Rousel Elaine T. Fernandez, Joy A. Agravante, Ivy B. Magdadaro, and Peter A. Chapman, Editors. Copyright 2016. All rights reserved. ISSN 1529-2754. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR Europe subscription rate is US$775 per half-year, delivered via e-mail. 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