TCREUR_Public/160719.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

            Tuesday, July 19, 2016, Vol. 17, No. 141



CROATIA: S&P Affirms 'BB/B' Sovereign Credit Ratings, Outlook Neg


HP PELZER: Moody's Hikes Corporate Family Rating to B1


* Moody's Says Hungary's Debt Dynamics Remain Benign in 2016-2017


CLERYS: New Owners File Legal Action Over Seizure of Documents
HARVEST CLO XVI: S&P Assigns Prelim. B Rating to Cl. F Notes


BANCA POPOLARE: Atlante Receives Tentative Offers for Lender
MONTE DE PASCHI: Italy, EC Explore Recapitalization Options


INTELSAT SA: S&P Raises CCR to 'CCC', Outlook Negative


CONISTON CLO: Moody's Affirms B3(sf) Rating to Class F Notes
GLOBAL TIP: Moody's Withdraws B1 Corporate Family Rating
NEW WORLD: Industry Ministry Registers CZK1.88BB Claim


ROSUKRENERGO: Gazprom Completes Liquidation of Venture Company


FTA SANTANDER EMPRESAS 3: S&P Raises Rating on Cl. D Notes to B-

U N I T E D   K I N G D O M

ARGYLE LTD: Missing $18 Million Link in Liquidation
AVANTI COMMUNICATIONS: Moody's Cuts Corporate Family Rating to Ca
BHS GROUP: Sale Proceeds Used to Pay Olswang Legal Fees
CATALYST HEALTHCARE: Moody's Raises Rating on Sr. Bonds From Ba1
GULF KEYSTONE: Bondholders Agree to Swap US$500MM Debt for Equity

ODEON & UCI: S&P Puts 'B-' CCR on CreditWatch Positive


* Company Insolvencies in Central, Eastern Europe Down in 2015



CROATIA: S&P Affirms 'BB/B' Sovereign Credit Ratings, Outlook Neg
S&P Global Ratings affirmed its 'BB' long-term and 'B' short-term
foreign and local currency sovereign credit ratings on the
Republic of Croatia.  The outlook remains negative.


S&P anticipates that the weak recovery of the Croatian economy
will continue, despite political uncertainties following the
breakup of the ruling coalition.

However, the ratings are constrained by what S&P now views are
less predictable policy responses to fiscal pressures and
structural imbalances as well as Croatia's high and growing
government debt burden.  S&P expects the external imbalances will
recede further, but structural economic problems, demonstrated
for instance by the state's dominant and inefficient role in the
economy, are unlikely to change without an effective government.

After only six months in power, the HDZ-MOST coalition under
technocrat Prime Minister Tihomir Oreskovic collapsed following a
conflict-of-interest investigation against HDZ leader
Tomislav Karamarko and a no-confidence vote against the Prime
Minister. Early elections were called for September, with a
caretaker government managing the country in the meantime.
Mirroring last year's November election outcome, S&P sees the
possibility of another hung parliament that may lead to a
prolonged period of political uncertainty following the
forthcoming election.  In S&P's view, this may stall structural
reforms and hamper the government's ability to implement
effective policies that would deliver sustainable public finances
and promote balanced economic growth.

In addition, this may impede Croatia's nascent recovery that had
recently shown increasing signs of strength.  While Croatia's 10-
year average weighted real GDP per capita growth is no longer
weaker than peers in the same GDP-per-capita category, S&P thinks
it may easily fall behind again, depending on the drag on
consumer sentiment and investment stemming from domestic
political uncertainties.  Growth rebounded in 2015 after six
years of recession on the back of an ongoing, albeit weak,
eurozone recovery and a strong tourism season.  Domestic
consumption also contributed positively in light of the personal
income tax reform in January 2015 and tailwinds from subdued
inflation, low commodity prices, and rising real wages.  As these
positive trends continued into 2016, S&P expects the growth
momentum to be sustained this year.  S&P has therefore revised
its growth forecast for 2016 to 1.7% from 1.2%.  S&P expects net
exports and domestic consumption to remain the main pillars of
growth. Nevertheless, the political uncertainty may take its toll
on public and private investments, for instance, through delayed
EU funds' absorption.

Negative external developments, such as Brexit and an associated
economic slowdown in the eurozone, Croatia's key trading partner,
pose risks to Croatia's external performance, although to a
lesser extent than in other emerging markets in Europe.  Overall,
S&P expects growth to remain weak over 2016-2019 at an average of
1.9%.  In 2015, Croatia's general government deficit was
significantly lower, at 3.2%, than S&P's previous estimate of
5.6%.  This was due to some over-performance of tax revenues and
significant under-execution of capital investments because a
caretaker government was in charge during the last quarter.  In
this respect, fiscal performance could be somewhat stronger this
year and S&P expects a deficit of 2.9%.  Nevertheless, S&P
believes that a prolonged period of political instability will
weigh on fiscal consolidation and structural reform efforts, and
S&P do not expect Croatia to exit the Excessive Deficit Procedure
in 2016.  Croatia's fiscal performance is also exposed to one-off
shocks, for instance should any of the two arbitration cases of
the Croatian government with Hungarian oil company MOL be decided
against the government.  Potential lawsuits with foreign-owned
Croatian banks over the forced Swiss franc loan conversion last
year poses another risk.  S&P believes that fiscal pressures may
mount again in 2017, as a new government will be in place if
there is no clear policy response to more structural fiscal

Consistent with S&P's budgetary forecast, it expects net general
government debt will increase to 83.1% by 2019 from 78.2% in
2015. Contingent liabilities, in particular resulting from the
vulnerable financial situation of state-owned enterprises, could
increase this ratio, although much of Croatia's quasi government
debt is included in general government debt under the European
System of Accounts' 2010 framework.  In addition, foreign
currency debt currently represents 73% of general government
debt, making Croatia sensitive to changes in global monetary
conditions and sentiment, which could push up interest rates and
result in higher debt-servicing costs, especially in light of the
flight to quality following Brexit.

Given the export-led growth and positive terms of trade,
Croatia's external accounts are improving, and S&P expects the
current account to remain in surplus at least until 2019.  S&P
estimates a current account surplus of 2.3% of GDP in 2016,
driven by strong growth in tourism and low oil prices.  S&P
believes that external metrics will keep strengthening on the
back of growth in tourism, especially in the high-end segment,
thereby increasing export receipts (57.6% GDP in 2015 compared to
38% in 2008).  In the near term, S&P expects the political
instability may reduce Croatia's capital account surplus, mostly
due to lower EU funds absorption. That said, S&P also expects net
foreign direct investment inflow to pick up again to 2% of GDP in
2016 after a low 0.34% in 2015, stemming from high loan
repayments of foreign-owned banks to their parents and incurred
losses due to Swiss franc loan conversion. Gross external
financing needs could drop to 87.4% of current account receipts
(CARs) plus usable reserves by 2019 from 92% in 2015.  Given
these developments, narrow net external debt, S&P's preferred
measure, could decrease to 69.1% of CARs by 2019 from 70.5% in
2015.  While general government external debt increased to 36% of
GDP in 2015, up from 14% in 2008, financial sector external debt
declined to 14% of GDP from 19% in 2014, mostly due to the banks'
deleveraging during the years of private credit contraction.  S&P
expects a slight external releveraging over the forecast horizon,
however, mostly driven by government borrowing
and to a lesser degree by banks.  Still, higher current account
receipts and usable reserves will keep the external metrics
stable, supporting the rating, in S&P's view.

"In 2015, banks incurred a one-time loss of about Croatian kuna
(HRK)6.9 billion (slightly less than EUR1 billion but more than
3x the sector's combined 2014 profits) following a forced
conversion of Swiss franc loans.  Nevertheless, the banking
system remained stable and liquid.  Credit continued to contract
by 2% in 2015 and we expect it will continue to contract in 2016
given the potential slowdown in public and private investments.
Positively, the Swiss franc conversion contributed to the
reduction in nonperforming loans to 16.6%, the first time it was
below 17% since mid-2014. Given the lack of lending in the
private sector, banks deleveraged externally and increased their
exposure to the government, which now stands at 18.2% of their
assets (September 2015).  The Croatian National Bank (the central
bank) is committed to the kuna-euro peg, which limits monetary
policy flexibility, as does the highly euro-ized economy. In
2015, 71% of loans and 62% of deposits were denominated in or
linked to a foreign currency, usually the euro," S&P said.


The negative outlook reflects S&P's view that there is at least a
one-in-three likelihood that it could lower its ratings on
Croatia in the next six months.

S&P could lower the ratings if the domestic political crisis and
negative external developments undermine economic growth
prospects.  In particular, this could be the case if the 10-year
weighted average real GDP growth rate were to again fall below
levels comparable to peers.

On the other hand, if reform implementation gains momentum and
the economy continues to recover while the government manages to
keep the deficit in check, S&P could revise the outlook to

In accordance with S&P's relevant policies and procedures, the
Rating Committee was composed of analysts that are qualified to
vote in the committee, with sufficient experience to convey the
appropriate level of knowledge and understanding of the
methodology applicable.  At the onset of the committee, the chair
confirmed that the information provided to the Rating Committee
by the primary analyst had been distributed in a timely manner
and was sufficient for Committee members to make an informed
decision. After the primary analyst gave opening remarks and
explained the recommendation, the Committee discussed key rating
factors and critical issues in accordance with the relevant
criteria. Qualitative and quantitative risk factors were
considered and discussed, looking at track-record and forecasts.

The committee agreed that the institutional assessment has
deteriorated, while the economic assessment improved.  All other
key rating factors were unchanged.

The chair ensured every voting member was given the opportunity
to articulate his/her opinion.  The chair or designee reviewed
the draft report to ensure consistency with the Committee
decision. The views and the decision of the rating committee are
summarized in the above rationale and outlook.  The weighting of
all rating factors is described in the methodology used in this
rating action.


                                         To           From
Croatia (Republic of)
Sovereign Credit Rating
  Foreign and Local Currency             BB/Neg./B    BB/Neg./B
Transfer & Convertibility Assessment    BBB          BBB
Senior Unsecured
  Foreign Currency                       BB           BB
Short-Term Debt
  Local Currency                         B            B


HP PELZER: Moody's Hikes Corporate Family Rating to B1
Moody's Investors Service upgraded the corporate family rating
(CFR) of HP Pelzer Holding GmbH to B1 from B2, the probability of
default rating (PDR) to B1-PD from B2-PD, and the EUR280 million
senior secured notes rating to B1 from B2. The outlook remains


"The rating action reflects a material strengthening of key
credit metrics of HP Pelzer since its first-time rating
assignment in 2014", said Oliver Giani, a Moody's
Vice President -- Senior Analyst and lead analyst for HP Pelzer.
"Over the past two years HP Pelzer was able to significantly
improve its profitability on the back of strong cost control and
a higher focus on profitable contracts. This resulted in overall
stable leverage around 3.5x despite a tap issue in 2015". On the
back of strengthened profitability cash flow generation
continuously improved, allowing HP Pelzer to meet our upgrade
triggers such as its EBITA margin to improve to above 4.5% (6.3%
as per LTM period ending March 2016), debt/EBITDA below 3.5x
(3.5x as per LTM period ending March 2016), and positive free
cash flow generation (EUR15 million as per LTM period ending
March 2016). The stable outlook assigned reflects Moody's
expectation that HP Pelzer is on a good track to sustain
strengthened credit quality and build a solid track record."

Moody's said, "HP Pelzer's B1 CFR is supported by its well-
established position as a key supplier of noise reduction
components to the automotive industry. The company has been
operating with a number of the largest OEMs for over 20 years
which supports visibility of revenues by a high degree of
contracted revenues in light of the average life of model
platforms (5 to 7 years). In addition, HP Pelzer proved itself to
be a reliable strategic partner that is capable of providing
ongoing innovation within its product range and the company's
global presence makes it the partner of choice for global
manufacturers that need suppliers to be able to provide products
on a worldwide basis for an increasing number of global
platforms. We furthermore expect that the company will generate
positive free cash flow and gradually reduce financial leverage
on the back of increasing reliance of OEMs on outsourcing. This
development is supported by the current global demand for light
vehicles, provide the potential for growth in the automotive
suppliers industry in line with our positive industry outlook.

"At the same time the company's relatively small size compared to
much larger customers indicates only a modest negotiation power,
with the key risk for HP Pelzer being its ability to quickly pass
through raw material cost increases to sufficiently offset the
negative effects. Also, we note that the absence of aftermarket
activity that usually has higher profitability and provides for
greater stability in revenues generation as well as only moderate
profitability, despite recent improvements offer only moderate
capacity to absorb potential shocks in the market.

"The stable outlook on the ratings reflects Moody's expectation
that HP Pelzer will continue to strengthen its operating and
financial performance and will benefit from continued improving
market conditions in the automotive sector in line with our
positive industry outlook for the European automotive suppliers.
We also expect that the company will continue to improve credit
metrics supported by consistently generating modest free cash
flows once Adler Evo is successfully integrated and synergies
start to further improve the company's credit metrics."

HP Pelzer's liquidity profile remains adequate albeit improving
thanks to the fact that the company has improved its liquidity
position following the tap issue. Business seasonality tends to
be modest in the automotive supplier industry although HP Pelzer
has recorded significant working capital related cash absorption
during both 2015 (EUR25 million) and 2014 (EUR37 million) on the
back of strong topline growth.

Moody's said, "We think that the company will be able to meet its
financing and working capital needs with cash available on
balance sheet (EUR94 million at end of March 2016, including the
EUR20 million retained at collateral for the long term loan in
Brazil) and approximately EUR50-60 million of cash flow
generation from operating activity. Capital expenditure is
expected around EUR40 million going forward, most of which is
expansionary capex. Along with the bond, due in 2021, the
company's capital structure includes some short term credit lines
at local level and the long-term BRL62 million (approximately
EUR20.1 million) facility in Brazil which will also include
financial covenants under which we expect the company to maintain
adequate headroom.

"Albeit a further upgrade is currently unlikely given HP Pelzer's
narrow business profile, we would consider a rating upgrade if
the company improves its leverage to well below 3.0x debt/EBITDA,
improves its EBITA margin to above 8% on an ongoing basis and
sustainable free cash flow (FCF) indicated by FCF/debt in the
high single digit %."

A rating downgrade could result from a deterioration in operating
performance evidenced by EBITA margin of below 5%, debt/EBITDA
moving towards 4.0x, as well as negative free cash flow
generation on a sustainable basis.

HP Pelzer Holding GmbH (HP Pelzer or the "Company"),
headquartered in Witten, Germany, is a global leader in the
design, engineering and manufacturing of acoustic and thermal
components and systems for the automotive sector. Revenues in the
last twelve months to March 2016 amounted to EUR1.14 billion.


* Moody's Says Hungary's Debt Dynamics Remain Benign in 2016-2017
Hungary's debt dynamics remain benign in 2016-17, despite
challenges to economic growth and deficit revisions, says Moody's
Investors Service in a report published on July 14.

Moody's report, entitled "Government of Hungary: Debt Reduction
On Track Despite Growth Challenges and Deficit Revisions" is
available on

The rating agency's report is an update to the markets and does
not constitute a rating action.

"We forecast a slight reduction in the government debt burden
over the next two years based on a robust economic growth picture
and the government's commitment to maintaining primary
surpluses," says Evan Wohlmann, an Assistant Vice President and
Analyst at Moody's.

Moody's expects that Hungary's (Ba1 positive) government debt
will reach just below 75% of GDP by the end of 2016 and below 74%
next year.

Recent improvements to the fiscal framework provide some
assurance of a conservative budgetary stance in the coming years,
in Moody's view. Planned fiscal loosening in 2017 largely
reverses deficit improvements in 2015-16, although Hungary's
underlying debt dynamics remain positive.

And while recent data showed that Hungary's economic growth
softened sharply over the first quarter of 2016 to just 0.9% in
real annual terms, Moody's views challenges to growth as
temporary and manageable.

Moody's expects investment to recover in the coming months
following the start of the new EU funding period. Together with
an increase in private consumption and some fiscal easing, this
will likely result in growth of around 2-2.5% of GDP over the
next two years.

The banking sector recovery will support growth dynamics as
credit demand is rising gradually. This year is likely to mark a
turnaround for the sector, reflecting cuts in the banking levy in
place since 2013, greater policy predictability, and an improved
operating environment.

In addition, Hungary's vulnerability to currency mismatches has
been significantly reduced. The ongoing resolution of the
foreign-currency debt overhang of both households and the banking
sector has reduced the economy's vulnerability to external


CLERYS: New Owners File Legal Action Over Seizure of Documents
RTE News reports that the High Court has heard the seizure of
"privileged and confidential information" from the offices of a
Dublin property company by inspectors conducting an ongoing
criminal investigation into the collective redundancies at Clerys
Department Store was "wholly unlawful".

Last May inspectors appointed by the Workplace Relations
Commission entered the premises of D2 Private, a company linked
to the takeover of the department store, at Harcourt Terrace,
Dublin and removed items including a laptop computer and a number
of documents, including invoices, RTE News recounts.

According to RTE News, the investigation arose after 460 workers
lost their jobs on June 12, 2015, hours after Clerys was sold to
Natrium by its previous owners, the US Gordon Brothers group.

Natrium is a joint venture made up of Cheyne Capital Management
in the UK and a company of Deirdre Foley, owner of D2, RTE News

As a result, Ms. Foley and D2 have brought a High Court challenge
against the inspectors and the WRC claiming they were not
entitled to enter the office and take the materials, RTE News

Ms. Foley and D2 claim the inspectors only take documents and
materials relevant to their investigation and there was no
constitutional basis for the inspectors' actions, RTE News

The action is opposed, RTE News notes.

In his submissions to the court on July 14, Remy Farrell SC, for
Ms. Foley and D2, said the seizure of the documents and a laptop
computer by the inspectors was not only "wholly unlawful" but
also breached his client's privacy, RTE News recounts.

Ms. Foley and D2 say they were never the employers of the Clerys
workers, and a company called OCS Operations Ltd. was at all
times the employer and the decision to make the workers redundant
was made independently of D2 and Ms. Foley, RTE News relays.

As reported by the Troubled Company Reporter-Europe on July 9,
2015, The Irish Times related that OCS Operations Ltd., which ran
the department store, was placed into liquidation in dramatic
fashion, resulting in the immediate closure of the department
store and the loss of about 400 jobs.

Dublin-based Clery's operates the Best menswear stores, along
with other fashion stores, across Ireland.

HARVEST CLO XVI: S&P Assigns Prelim. B Rating to Cl. F Notes
S&P Global Ratings has assigned preliminary credit ratings to
Harvest CLO XVI DAC's class A, B, C, D, E, and F senior secured
floating-rate notes.  At closing, Harvest CLO XVI will also issue
unrated subordinated notes.

Harvest CLO XVI is a cash flow collateralized loan obligation
(CLO) transaction securitizing a portfolio of primarily senior
secured loans granted to speculative-grade corporates.  3i Debt
Management Investments Ltd. manages the transaction.

Under the transaction documents, the rated notes pay quarterly
interest unless a frequency switch event occurs.  Following this,
the notes permanently switch to semiannual interest payments.

The portfolio's reinvestment period will end four years after
closing, and the portfolio's maximum average maturity date will
be eight years after closing.

On the effective date, S&P understands that the portfolio will
represent a well-diversified pool of corporate credits, with a
fairly uniform exposure to all of the credits.  Therefore, S&P
has conducted its credit and cash flow analysis by applying its
criteria for corporate cash flow collateralized debt obligations.

In S&P's cash flow analysis, it has used the portfolio target par
amount of EUR400.00 million, the covenanted weighted-average
spread of 4.20%, the covenanted 'AAA' weighted-average recovery
rates, and the target portfolio weighted-average recovery rates
at every other rating level.

Bank of New York Mellon, London Branch will be the bank account
provider and custodian.  The participants' downgrade remedies are
in line with our current counterparty criteria.

At closing, S&P understands that the issuer will be in line with
its bankruptcy-remoteness criteria.

Following S&P's analysis of the credit, cash flow, counterparty,
operational, and legal risks, S&P believes its preliminary
ratings are commensurate with the available credit enhancement
for each class of notes.


Harvest CLO XVI Designated Activity Company
EUR411 Million Senior Secured Floating-Rate Deferrable Notes

Class                 Prelim.                     Prelim.
Class                 rating              amount (mil. EUR)

A                     AAA (sf)                        235
B                     AA (sf)                          60
C                     A (sf)                           23
D                     BBB (sf)                         21
E                     BB (sf)                          21
F                     B (sf)                           10
Sub                   NR                               41

NR--Not rated.


BANCA POPOLARE: Atlante Receives Tentative Offers for Lender
Rachel Sanderson and Martin Arnold at The Financial Times report
that investors are jostling for position to buy two regional
Italian lenders taken over recently by the country's bank rescue
fund to clean up their bad loans.

Atlante, which is run by Quaestio Capital Management, has
received tentative offers from several bidders on the sale of the
two regional banks, Banca Popolare di Vicenza and Veneto Banca,
according to senior bankers, the FT relates.  All the mooted bids
assume that Atlante would keep all or the majority of the banks'
bad loans, the FT states.

According to the FT, senior bankers said Banca Popolare
dell'Emilia Romagna, a rival Italian regional bank, has held
talks about buying Veneto Banca if it cleaned up of all its bad

Senior financiers, as cited by the FT, said York Capital, the US
private equity fund, and Sixiang of China -- together with a
group of Italian business owners -- have also put in an offer for
the "good bank" of Veneto Banca.

Atlas Merchant Capital, the US-based private equity fund set up
by former Barclays boss Bob Diamond, is among the list of suitors
for the two banks, which is also reported to include Warburg
Pincus, Baupost and Centerbridge, the FT notes.

Atlante is a EUR4.25 billion government sponsored, privately
funded, fund set up to backstop capital increases worth a
combined EUR2.5 billion at Vicenza and Veneto Banca amid zero
interest from private investors, the FT discloses.

The fund, run by Alessandro Penati, has plans to clean up the
banks and sell them in order to plough the funds back into
cleaning up bad loans bogging down other weak Italian lenders,
the FT says.

The expressions of interest are not due to be finalized until
after the summer, according to the FT.

Popolare di Vicenza is an Italian regional lender.

MONTE DE PASCHI: Italy, EC Explore Recapitalization Options
Tom Beardsworth and Katie Linsell at Bloomberg News report that
Italy and the European Commission are seeking ways to
recapitalize Monte Paschi, Italy's third-largest bank, and other
lenders amid concerns they may fail critical stress tests due at
the end of the month.

According to Bloomberg, people familiar with the discussions said
talks have foundered on whether creditors should face losses --
under so called bail-ins -- if taxpayer funds are used.

"Panic is stemming from the fact that they are running a stress-
test scenario, an adverse scenario," Bloomberg quotes
Davide Serra, the CEO of hedge fund Algebris, as saying.

Sellers of credit-default swaps demand more to insure Monte
Paschi's subordinated bonds for one year than they do for three
years, Bloomberg relays, citing data from CMA.  A so-called
inverted curve is a market distortion that typically happens when
investors are concerned they may not get their money back in the
near term, Bloomberg says.

Societe Generale SA Chairman Lorenzo Bini Smaghi said on July 6
policymakers will want to avoid a messy outcome at a big Italian
bank this month because it could spark panic across Europe,
Bloomberg recounts.

Credit traders on July 6 lowered the amount of value they expect
to recover on bonds sold by Monte Paschi if it were to default,
Bloomberg discloses.

                     About Monte dei Paschi

Banca Monte dei Paschi di Siena SpA -- is
an Italy-based company engaged in the banking sector.  It
provides traditional banking services, asset management and
private banking, including life insurance, pension funds and
investment trusts.  In addition, it offers investment banking,
including project finance, merchant banking and financial
advisory services.  The Company comprises more than 3,000
branches, and a structure of channels of distribution.  Banca
Monte dei Paschi di Siena Group has subsidiaries located
throughout Italy, Europe, America, Asia and North Africa.  It has
numerous subsidiaries, including Mps Sim SpA, MPS Capital
Services Banca per le Imprese SpA, MPS Banca Personale SpA, Banca
Toscana SpA, Monte Paschi Ireland Ltd. and Banca MP Belgio SpA.


INTELSAT SA: S&P Raises CCR to 'CCC', Outlook Negative
S&P Global Ratings said it raised its corporate credit rating on
Luxembourg-based Intelsat S.A. to 'CCC' from 'SD'.  The outlook
is negative.

At the same time, S&P raised its issue-level ratings on
Intelsat's 5.5% senior notes due 2023 and 7.5% senior notes due
2021 to 'CCC' from 'CC'.  Additionally, S&P raised its issue-
level rating on Intelsat's 6.625% senior notes due 2022 to 'CCC'
from 'D'.  The recovery ratings remain '4', indicating S&P's
expectation for average (30%-50%; upper half of the range)
recovery for lenders in the event of a payment default.

"The upgrade follows our review of Intelsat's capital structure
and liquidity following the completion of its recently announced
tender offer," said S&P Global Ratings credit analyst Rose

When the company announced its tender transaction in May, S&P
viewed the below-par debt repurchases of its 6.625% senior notes
due 2022 as a distressed restructuring and tantamount to default.

The 'CCC' rating reflects S&P's view that the company could
pursue additional subpar debt exchanges or redemptions over the
next 12 months as part of its balance sheet initiatives.  S&P
believes any future potential actions are more likely to take
place at Intelsat Luxembourg given current trading levels and
$475 million of debt maturities in 2018.  Intelsat Luxembourg
also received approximately $350 million from Intelsat Jackson
through the repayment of its intercompany loan following the
issuance of $1.25 billion of senior secured notes.

The negative outlook reflects the potential for additional subpar
debt exchanges, in S&P's view, given the company's current debt
trading levels and available cash at Intelsat Luxembourg
following Intelsat Jackson's repayment of its intercompany loan.
S&P do not foresee risk of a near-term cash default given the
company's improved liquidity position as a result of recent debt


CONISTON CLO: Moody's Affirms B3(sf) Rating to Class F Notes
Moody's Investors Service announced that it has taken rating
actions on the following classes of notes issued by Coniston CLO

-- EUR56.7 million(current outstanding balance of EUR 56.2
    million) Class A2 Senior Floating Rate Notes due 2024,
    Affirmed Aaa (sf); previously on Jul 15, 2015 Affirmed Aaa

-- EUR24.6 million Class B Deferrable Interest Floating Rate
    Notes due 2024, Affirmed Aaa (sf); previously on Jul 15, 2015
    Upgraded to Aaa (sf)

-- EUR24 million Class C Deferrable Interest Floating Rate Notes
    due 2024, Upgraded to Aa1 (sf); previously on Jul 15, 2015
    Upgraded to Aa2 (sf)

-- EUR17.6 million Class D Deferrable Interest Floating Rate
    Notes due 2024, Upgraded to A3 (sf); previously on Jul 15,
    2015 Upgraded to Baa1 (sf)

-- EUR19.6 million Class E Deferrable Interest Floating Rate
    Notes due 2024, Affirmed Ba3 (sf); previously on Jul 15, 2015
    Upgraded to Ba3 (sf)

-- EUR6.4 million (current outstanding balance of EUR3.8
    million) Class F Deferrable Interest Floating Rate Notes due
    2024, Affirmed B3 (sf); previously on Jul 15, 2015 Upgraded
    to B3 (sf)

Coniston CLO B.V. issued in August 2007, Collateralised Loan
Obligation ("CLO") backed by a portfolio of mostly high yield
European loans. The portfolio is managed by 3i Debt Management
Ltd. This transaction ended its reinvestment period in July 2013.


The rating actions on the notes are primarily a result of the
deleveraging of the class A notes following amortization of the
underlying portfolio since the last rating action in July 2015.

Classes A1 and A2 notes have collectively paid down by EUR47.6
million (class A1 has now fully redeemed) resulting in increases
in over-collateralization (OC) ratios. As per the trustee report
dated May 2016, class A, class B, class C, class D, class E and
Class F OC ratios are reported at 276.59%, 192.35%, 148.28%,
126.96%, 109.43% and 106.60% respectively, compared to May 2015
levels of 195.08%, 157.70%, 132.86%, 119.11%, 106.79% and

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 of EUR158.69 million,
defaults of EUR7.91 million, a weighted average default
probability of 22.43% (consistent with a WARF of 3272 over a
weighted average life of 4.03 years), a weighted average recovery
rate upon default of 43.97% for a Aaa liability target rating, a
diversity score of 26 and a weighted average spread of 3.67%.

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.

GLOBAL TIP: Moody's Withdraws B1 Corporate Family Rating
Moody's Investors Service, ("Moody's") has withdrawn Global TIP
Holdings Two B.V.'s (TIP Trailer or the company) B1 corporate
family rating (CFR), B2-PD probability of default rating (PDR).
At the time of withdrawal, all the aforementioned ratings carried
a stable outlook.


Moody's has withdrawn the rating for its own business reasons.

TIP Trailer is the leading pan-European provider of trailer fleet
services. The company's main activity (approximately 74% of 2015
revenue excluding equipment sales) consists of long-term and
short-term leasing of trailers to transportation and logistics
companies and private fleet operators on an operating lease basis
through its owned fleet of approximately 45,000 units as of
December 2015 (including lease-in units). TIP Trailer also
provides trailer fleet management services (24% of 2015 revenues
excluding equipment sales) to its own fleet and to third parties
on a standalone basis. Founded in 1968, Tip Trailer was
previously owned and operated by General Electric under its GE
Capital division until it was acquired by the Chinese
conglomerate HNA in Q4 2013 via the newly created holding
company, Global TIP Holdings One B.V. In fiscal year ending 31
December 2015, TIP Trailer reported revenues and EBITDA of EUR372
million and EUR105 million, respectively.

NEW WORLD: Industry Ministry Registers CZK1.88BB Claim
CTK reports that the Czech Industry and Trade Ministry registered
a CZK1.888 billion claim on insolvent black-coal mining company
OKD, which is the cost of the phase-out of all OKD mines.

Ministry spokesman Frantisek Kotrba told CTK on July 14 the
claim, which was registered with the Regional Court in Ostrava,
involves the costs the state would have to spend on the mines'
phase-out and the security of the people and the assets if OKD, a
unit of New World Resources, lacked money to ensure that.

Mr. Kotrba, as cited by CTK, said the conditional claim was
registered by minister Jan Mladek immediately after the July 11
meeting of the government which dealt with this option.

OKD got into trouble due to falling prices of coal and high
debts, CTK discloses.  It filed for insolvency in May, CTK
recounts.  In the insolvency petition, OKD said that it owed over
CZK17 billion to at least 650 creditors.  Over 500 creditors have
registered their claims so far, CTK notes.

The government deals with the OKD problems, CTK states.
According to CTK, it has to make a decision on whether it will
lend money to the coal miner and what will be the amount to be
used for financing its operating costs.  OKD, CTK says, lacks
cash to finance its operations.

Creditors will meet in August to discuss OKD's future, CTK

                     About New World Resources

New World Resources N.V. is owned and controlled by New World
Resources Plc, an English public limited company domiciled in the
Netherlands that is admitted for trading on the London Stock
Exchange, where it maintains a Premium Listing, along with the
Warsaw Stock Exchange and the Prague Stock Exchange.

The ultimate parent and indirect majority owner of NWR is CERCL
Mining B.V., a privately-held Dutch company, which owns a
controlling majority of the shares of NWR Plc.

NWR's primary role in its corporate group has been to issue debt
(primarily in the form of secured and unsecured notes) and to
loan the corresponding proceeds to its wholly-owned operating
subsidiaries.  These operating subsidiaries conduct coal mining
and exploration operations in the Czech Republic and Poland.  The
operating subsidiary conducting mining operations in the Czech
Republic is critical to the local economy in that country.
Collectively, these operating subsidiaries employee over 11,500
workers (and utilize an additional 3,000 contractors), and many
major steel groups -- including some operating in the U.S. -- are
reliant on their coal.

As of July 15, 2014, NWR had outstanding gross external debt of
approximately EUR825 million (exclusive of amounts it owes under
certain intercompany obligations).  Of this debt, EUR500 million
in principal amount plus accrued interest is owed to the
beneficial holders of the 7.875% Senior Secured Notes due May 1,
2018.  NWR also owes EUR275 million in principal amount plus
accrued interest to the beneficial holders of its 7.875% Senior
Unsecured Notes due January 15, 2021.

NWR applied to the Chancery Division (Companies Court) of the
High Court of Justice of England and Wales, on July 28, 2014, for
an order directing it to convene separate meetings for two
classes of creditors only, namely, the existing senior secured
noteholders on the one hand, and the existing senior unsecured

NWR filed a Chapter 15 bankruptcy petition (Bankr. S.D.N.Y. Case
No. 14-12226) in Manhattan, New York on July 30, 2014, to seek
recognition of the UK proceeding.

Neither the Debtor's parent nor any of its operating subsidiaries
have commenced insolvency proceedings in the UK Court or any
other court within any jurisdiction.

The U.S. case is assigned to Judge Stuart M. Bernstein.


ROSUKRENERGO: Gazprom Completes Liquidation of Venture Company
The Herald, citing Russian news agency RIA Novosti, reports that
Russian energy giant Gazprom has completed the liquidation of
Swiss gas trader RosUkrEnergo.

The process began in 2014, the news agency wrote, referring to
the company's information.

RosUkrEnergo has been excluded from the list of affiliated
entities of Russia's Gazprom, which was prepared for June 30,
2016, according to The Herald.

Ukraine's Naftogaz and Russia's Gazprom were operating from 2006
to 2009 through a Swiss-registered venture company --
RosUkrEnergo AG, owned by Gazprom and run by Ukrainian
businessmen Dmytro Firtash and Ivan Fursin, the report notes.

The company held a monopoly in natural gas supplies to Ukraine.
In 2009, Naftogaz signed direct contracts with Gazprom, having
acquired RosUkrEnergo's debt of $1.7 billion, in exchange for gas
supplied by the Russian company, the report relays.

Naftogaz, however, unilaterally withdrew 11 billion cubic meters
of gas from the Swiss company, and the dispute is now being heard
before an arbitration court in Stockholm, the report notes.

In 2010, the court ordered Naftogaz to return 11 bcm of natural
gas to RosUkrEnergo, while RosUkrEnergo would receive from
Naftohaz an additional 1.1 bcm of natural gas, in lieu of
RosUkrEnergo's entitlement to penalties for a breach of contract,
the report adds.


FTA SANTANDER EMPRESAS 3: S&P Raises Rating on Cl. D Notes to B-
S&P Global Ratings raised its credit ratings on Fondo de
Titulizacion de Activos Santander Empresas 3's class B, C, and D
notes.  At the same time, S&P has affirmed its ratings on the
class A2, A3, E, and F notes.

In S&P's analysis, it applied its European small and midsize
enterprise (SME) collateralized loan obligation (CLO) criteria
and S&P's current counterparty criteria.

After determining the average portfolio quality, where an
originator's internal SME scoring system is not used as a
building block in S&P's rating analysis, it used the same average
portfolio quality for each performing asset in the portfolio for
the purpose of inclusion in CDO Evaluator.  For ratings in this
transaction that are above S&P's rating on the sovereign, it has
also applied its criteria for rating single-jurisdiction
securitizations above the sovereign foreign currency rating.

The transaction is currently amortizing.  The senior class A1
notes have been repaid and the class A2 and A3 notes are
amortizing with a current note factor of less than 2%.  As a
result of this structural deleveraging, the available credit
enhancement has increased for all of the rated notes, except for
the class E and F notes.  The upgrades reflect this increased
available credit enhancement.

The portfolio has amortized to 9.14% of the initial portfolio
balance.  The asset performance has been stable since S&P's
previous review in October 2015, with loans in arrears for more
than 90 days at 1.12% of the current portfolio balance.  In this
transaction, a loan is classified as defaulted if it is in
arrears for more than 12 months.  Gross defaults have also been
stable with the cumulative default rate at 3.42% of the initial
balance, compared with 3.27% at S&P's previous review.
Notwithstanding the low pool factor, the portfolio remains
granular and well diversified, with 2,235 individual obligors.

Following S&P's credit and cash flow analysis, and the
application of its RAS criteria, S&P has determined that the
available credit enhancement for the class A2, A3, and B notes is
commensurate with a 'AA- (sf)' rating (i.e., four notches above
our 'BBB+' long-term sovereign rating on Spain).  Therefore, S&P
has affirmed its 'AA- (sf)' ratings on the class A2 and A3 notes,
and has raised to 'AA- (sf)' from 'BBB+ (sf)' its rating on the
class B notes.  Under S&P's RAS criteria, the class A2 and A3
notes could potentially achieve a rating of up to six notches
above the sovereign -- 'AA+ (sf)' -- if the transaction had
liquidity support to cover one debt service payment through a
reserve fund or an external funding mechanism.  However, the
transaction's reserve fund is depleted, against a required
balance of EUR29.20 million. The depletion of the reserve fund is
due to the accumulation of defaults in the portfolio.

The upgrade of the class C notes -- driven by the increased
available credit enhancement -- is constrained by the application
of our RAS criteria.  The tranche cannot withstand the severe
stress outlined in S&P's criteria to achieve a rating that is
higher than the long-term sovereign rating.  Therefore, S&P has
raised to 'BBB+ (sf)' from 'BBB- (sf)' its rating on the class C
notes (i.e., no higher than the long-term sovereign rating on

In S&P's view, the available credit enhancement for the class D
notes is commensurate with a higher rating than that currently
assigned.  S&P has therefore raised to 'B- (sf)' from 'CCC+ (sf)'
its rating on this class of notes.  The class D notes are paying
interest on a timely basis and, in light of the transaction's
historical stable collateral performance, a breach of an interest
deferral trigger seems unlikely in a base-case scenario.  The
breach occurs when gross cumulative defaults reach 5.60% of the
initial collateral balance.  A breach of this trigger could
potentially result in the junior and mezzanine notes experiencing
an interest shortfall, while the 'AA-' rated notes would be
repaid faster.

The class E notes are currently undercollateralized.  The
interest deferral trigger threshold for this class of notes is
breached when gross cumulative defaults reach 4.70% of the
initial collateral balance.  The current level of gross defaults
in the portfolio is 3.27%.  In S&P's view, the available
subordination for the class E notes is commensurate with its
currently assigned rating.  S&P has therefore affirmed its 'CCC-
(sf)' rating on this class of notes.

S&P's 'D (sf)' rating on the class F notes reflects that it has
missed an interest payment.  S&P has affirmed this rating as its
analysis indicates that the available credit enhancement is
commensurate with the currently assigned rating.

Fondo de Titulizacion de Activos Santander Empresas 3 is a
single-jurisdiction cash flow CLO transaction backed by loans to
Spanish SMEs.  The transaction closed in May 2007 and is
currently amortizing.


Fondo de Titulizacion de Activos Santander Empresas 3
EUR3.546 Billion Floating-Rate Notes

Class                   Rating
             To                    From

Ratings Raised

B            AA- (sf)              BBB+ (sf)
C            BBB+ (sf)             BBB- (sf)
D            B- (sf)               CCC+ (sf)

Ratings Affirmed

A2           AA- (sf)
A3           AA- (sf)
E            CCC- (sf)
F            D (sf)

U N I T E D   K I N G D O M

ARGYLE LTD: Missing $18 Million Link in Liquidation
The Royal Gazette reports that an accountant from KPMG Bermuda
has been appointed as joint liquidator of a Gibraltar company
alleged to be at the heart of a missing $18 million for a
Hamilton hotel project.

Charles Thresh -- --  a forensic accountant
with the firm, will join Samuel Moses Vidal Cohen-- -- of Gibraltar firm Benady, Cohen and Co
as liquidators of Argyle Ltd, which is based in the UK Overseas
Territory bordering Spain.

Argyle Ltd was involved in a probe into the whereabouts of an $18
million loan to Par-la-Ville Hotel and Residences from Mexico
Infrastructure Finance, which was intended to help to secure
funding to build a hotel and residences on the site of Hamilton's
Par-la-Ville car park, the report notes.

The loan was guaranteed by the Corporation of Hamilton after
Parliament amended the law to allow the corporation to use the
car park as collateral, the report discloses.

The funds were put in a New York escrow account and withdrawn in
2014, with much of the cash said to have gone to Argyle, the
report relays.

The developers later defaulted on the loan, which sparked legal
action by Mexico Infrastructure against Par-la-Ville Hotel and
Residences, the report discloses.

The report notes that Mr. Thresh and colleague Mike Morrison were
last year appointed a joint provisional liquidators of Par-la-
Ville Hotel and Residences by Bermuda's Supreme Court, the report

AVANTI COMMUNICATIONS: Moody's Cuts Corporate Family Rating to Ca
Moody's Investors Service downgraded the Corporate Family Rating
("CFR") and the senior secured bond ratings of Avanti
Communications Group plc ("Avanti") to Ca from Caa1 as well as
its Probability of Default Rating ("PDR") to Ca-PD from B3-PD.
The outlook on all ratings is negative.

"The ratings downgrade reflects Avanti's significantly
deteriorated liquidity and reduced EBITDA which result in a lower
enterprise valuation. As a result, the risk of default over the
next 6-12 months is very high and the Ca rating is consistent
with a recovery in the 35%-65% range at default," says
Alejandro Nunez, a Moody's Vice President -- Senior Analyst and
lead analyst for Avanti.


The rating action principally reflects the company's
deteriorating liquidity resulting from lower than anticipated
cash earnings and a higher than expected working capital outflow
over the past two quarters.

The company's expected revenue and earnings for its fiscal year
ended June 30, 2016 (FY16), of $US83 million and $US8 million
respectively, are markedly lower than Moody's previous
expectations and the company's previous guidance. Moody's expects
that Avanti will generate limited cash EBITDA growth over the
coming fiscal year and, as a result, Avanti's leverage will rise
rather than decline over the course of FY17.

Set against a cash balance of $US57 million as of June 30, 2016,
approximately $US60 million in milestone payments related to
HYLAS-3 and HYLAS-4 due over the next two quarters to its
suppliers (principally satellite construction, launch and
insurance companies) and an interest payment of $US32.25 million
due on October 1, 2016, Avanti will face a liquidity shortfall
within this period unless it is able to secure additional
external capital in a timely fashion.

As mentioned in its trading update, full access to an Export
Credit Agency Facility currently under negotiation has now become
subject to the condition that Avanti raises at least $US50
million in equity capital. Moody's acknowledges that Avanti is
currently in discussions not only with investors with regard to
an equity raise but also with potential strategic investors for a
corporate transaction such as a merger with or offer for the
company by a third party or a sale of its businesses. The company
has a successful record of raising additional funding on multiple
occasions in the past but the lack of earnings growth in FY16
casts significant doubt on its growth prospects and ability to
raise further funding in a way which preserves full recovery for

While any of the strategic options under review by Avanti may
eventually materialize, there is no clear visibility on their
certainty or timing. As a result, Moody's sees a default by
Avanti over the next 6-12 months as almost inevitable, which is
consistent with a PDR of Ca-PD.

However, given the tangible asset value in Avanti's comparatively
young, well-invested high-throughput satellite fleet and the fact
that Avanti's capital structure is dominated by its $US 645
million of senior secured notes which contain no financial
covenants, Moody's deems the likely recovery rate for Avanti's
senior secured notes to be in the 35%-65% range in an event of
default which is consistent with a CFR of Ca and a Ca rating for
the senior secured notes.


Moody's said, "The negative outlook reflects a high likelihood of
a default in the near term with the attendant uncertainty for
liquidity and recovery prospects as well as our expectation that
Avanti's liquidity situation may not improve without timely
access (September 2016) to sufficient external funding sourced
from either equity markets or third-party investors. It also
reflects the increasingly challenging market and operating
outlook facing the company over the next two to three years."


Negative pressure on the ratings could be exerted if Avanti's
liquidity situation deteriorated further beyond that presently
anticipated. In addition, the ratings could be downgraded if
Moody's were to lower its recovery expectations for Avanti's

Positive rating pressure could develop if Avanti were able to
access external funding sufficient for it to meet its commitments
due by October 2016 and to also fund itself adequately over at
least the next 18 months. Upward pressure on the rating would
also require a recovery in EBITDA and/or significant debt
reduction to a level which would make the company's capital
structure more sustainable or a higher assessment of potential
recoveries for bondholders than the currently assumed range of

Avanti Communications Group Plc is a fixed satellite service
provider with licenses for three geostationary orbital slots. The
company sells satellite data communications services to telecoms
companies which use them to supply enterprise, institutional and
consumer users. Avanti's first satellite, HYLAS 1, launched in
November 2010 and was the first Ka-band satellite launched in
Europe. Avanti's second satellite, HYLAS 2, was launched in
August 2012 and extends coverage to Africa, the Caucasus and the
Middle East. HYLAS 3 will also serve Africa following its
expected launch in Q1 2017. HYLAS 3 and 4 will complete Avanti's
coverage of EMEA following expected launches in 2017.

Founded in 2002, the present group was formed when the company
floated on the Alternative Investment Market (AIM) in 2007. For
the twelve months ended June 30, 2016 (fiscal year 2016), Avanti
estimated its revenues were $US83 million compared to $US85
million for the same period in 2015. The group also estimated its
FY16 EBITDA at approximately $US8 million compared to $US16
million for the same period in 2015.

BHS GROUP: Sale Proceeds Used to Pay Olswang Legal Fees
Mark Vandevelde at The Financial Times reports that Sir Philip
Green's Arcadia Group has sought answers from a London law firm
after money earmarked for the running of BHS was used to pay the
legal costs of the group that bought the high street chain.

The questions, contained in correspondence released on July 15 by
a parliamentary inquiry into the collapse of BHS, open a new
front in a controversy that has already drawn in three of the Big
Four accountancy firms and US investment bank Goldman Sachs, the
FT relates.

At the same time as it bought BHS from Sir Philip last year,
Dominic Chappell's Retail Acquisitions vehicle sold an office
building belonging to the retailer, the FT recounts.

The group promised Sir Philip's company that the proceeds would
be retained by BHS "for the sole purpose of the day-to-day
running of the business", the FT relays.

However, MPs have heard that GBP7 million of the proceeds were
transferred to Retail Acquisitions, which then used the money to
pay professional fees related to the transaction, including a
GBP1.2 million bill from Olswang, the FT notes.

According to the FT, in a letter to Olswang partner David
Roberts, lawyers for Sir Philip's Arcadia Group contend that the
transfer was "in breach of the covenants [made by Mr. Chappell's
group]" and that it took place "at Mr. Roberts' specific

Administrators announced last month that they would close all 164
BHS stores after failing to find a buyer for the business, the FT
recounts.  Twenty are already close to running out of stock, and
will shut their doors for the last time on July 23, the FT

An official rescue fund is preparing to absorb GBP571 million in
unfunded pension liabilities left behind by the high street
chain, in a process that will cut the retirement incomes of
thousands of former workers, the FT says.

BHS Group is a British department store chain.  The company
employs 10,000 people and has 164 shops.

CATALYST HEALTHCARE: Moody's Raises Rating on Sr. Bonds From Ba1
Moody's Investors Service upgraded to Baa3 from Ba1 the ratings
of the GBP218 million of index-linked guaranteed senior secured
bonds due 2040 (the Bonds) issued by Catalyst Healthcare
(Manchester) Financing plc (Catalyst Manchester) and a GBP175
million guaranteed senior secured loan provided by the European
Investment Bank (the EIB Debt). The upgrade reflects that
Catalyst Manchester and the Central Manchester University
Hospitals NHS Foundation Trust (the Trust) have signed a
settlement agreement (the Settlement) regarding the claimed fire
protection deficiencies. The outlook on the ratings was
concurrently changed to stable from developing.

In the same action, Moody's has upgraded to Baa3 from Ba1 the
underlying ratings of the Bonds and the EIB Debt.


"The rating action reflects the signing of a settlement agreement
between Catalyst Manchester and the Trust. The Settlement
achieves a full resolution of the Trust's fire protection related
unavailability claims" says Kunal Govindia, an Assistant Vice
President - Analyst in Moody's Infrastructure Finance Group and
lead analyst for Catalyst Healthcare (Manchester) Financing plc.

The previously levied but deferred deductions have been waived,
and the Trust will not apply deductions in the future in relation
to this issue. The Settlement has therefore dispelled the
potential risk of significant financial deductions causing a
project agreement (PA) termination or a debt service non-payment.
In addition the Trust has taken responsibility for completing the
necessary remedial works, including correcting any new
deficiencies discovered.

Catalyst Manchester's Settlement is more credit positive than
seen for other rated issuers -- such as Coventry and Rugby
Hospital Company plc (CRHC) and Peterborough Progress Health
plc -- that have signed fire protection settlement or standstill
agreements. This is primarily because Catalyst Manchester is not
responsible for completing or paying for remedial works, and is
protected from newly discovered defects. In contrast, other
issuers (such as CRHC and Peterborough Progress Health plc),
retain some financial and operational responsibility for
completing remedial works.

The Baa3 rating reflects, as positives (1) the Settlement between
Catalyst Manchester and the Trust regarding the fire protection
related unavailability; (2) Catalyst Manchester has limited
exposure to the completion of remedial works because the Trust is
performing these; (3) Catalyst Manchester will not face
additional costs or deductions if new fire protection
deficiencies are discovered; (4) the long-term PA Catalyst
Manchester entered into with the Trust; (5) the availability-
based revenue stream under the PA; (6) satisfactory performance
of facilities management (FM) services; and (7) a range of
creditor protections included within the project's financing
structure, such as debt service and maintenance reserves.

The rating is constrained however by (1) Catalyst Manchester will
need to adequately manage the interaction between FM service
delivery and the Trust's remedial works; (2) Catalyst
Manchester's high leverage, with minimum and average debt-service
coverage ratios of 1.19x and 1.31x respectively; and (3) the FM
subcontractor's low liability caps, which are substantially
weaker than those in other PFI hospital projects.

The Bonds and the EIB Debt benefit from an unconditional and
irrevocable guarantee of scheduled principal and interest by
Ambac Assurance UK Limited (Ambac). However, since Ambac's
insurance financial strength rating was withdrawn on 7 April
2011, the rating on the Bonds and EIB Debt is currently
determined by the credit quality of the project on a standalone


Moody's could upgrade the ratings if over a sustained period (1)
Catalyst Manchester demonstrates a successful interaction between
FM service provision and the Trust's remedial works delivery; and
(2) deductions and service failure points remain low once the
full FM performance monitoring regime is re-introduced.

Moody's could downgrade the rating if (1) operational
difficulties arise as a result of the interaction between
Catalyst Manchester's FM services and the Trust's remedial works;
or (2) deductions and service failure points increase
significantly once the full FM performance regime is activated.

Catalyst Manchester was established to take over and upgrade an
existing hospital estate in the center of Manchester, England,
which forms a 1,470-bed hospital and provide FM and lifecycle

GULF KEYSTONE: Bondholders Agree to Swap US$500MM Debt for Equity
Karolin Schaps and Dmitry Zhdannikov at Reuters report that
distressed debt funds will become big shareholders in troubled
oil firm Gulf Keystone after bondholders agreed to swap US$500
million of debt for equity, wiping out some of the world's top
funds as shareholders.

According to Reuters, the firm has been fighting to avoid
insolvency after low oil prices and overdue oil export payments
from the Kurdistan regional government crippled its balance

But the deal will also set the stage for a battle for control if
its new shareholders decide to offload their stakes to a new
strategic investor, which Gulf Keystone has been seeking, Reuters

The company said current shareholders, which include Capital
Group, Prudential, Barclays and BlackRock would see their
ownership diluted to 5%, Reuters relates.

Sothic Capital, a London-based fund led by former distressed
specialists from JP Morgan, is among the bondholders that will
end up with a significant stake, Reuters relays, citing sources
close to the company and bondholders.

Other such bondholders are GLG Partners, part of hedge fund
Man Group, and investment fund Taconic Capital, Reuters

After the bond swap is completed, Gulf Keystone's debt will fall
to US$100 million from the current US$600 million of guaranteed
and convertible bonds maturing in 2017, making it a much more
attractive acquisition target, Reuters says.

Gulf Keystone operates the giant Shaikan oil field in Iraqi
Kurdistan and produces about 40,000 barrels per day (bpd),
Reuters states.

Gulf Keystone Petroleum Limited is an oil and gas exploration and
production company operating in the Kurdistan region of Iraq.  It
is listed on the main market of the London Stock Exchange.

ODEON & UCI: S&P Puts 'B-' CCR on CreditWatch Positive
S&P Global Ratings placed on CreditWatch with positive
implications its 'B-' corporate credit rating on U.K.-based
cinema operator Odeon & UCI Cinemas Group Ltd.  S&P also placed
on CreditWatch positive its issue ratings on Odeon's debt.

The CreditWatch placement follows the announcement by
Kansas-based movie theater exhibitor AMC Entertainment Holdings
that it has entered into a definitive agreement to acquire Odeon
for GBP921 million in cash, stock consideration, and assumed
debt. Under the proposed transaction, which S&P expects will
close by the end of the fourth quarter 2016, Odeon will become
part of the financially stronger AMC.  S&P expects that all of
Odeon's outstanding debt will be redeemed as part of the
transaction.  The transaction is conditional upon antitrust
clearance by the European Commission and is subject to
consultation with the European Works Council.  If the acquisition
is completed, the combined company will be the largest movie
theater operator in the world with 627 theaters and more than
7,600 screens in eight countries.

Assuming the transaction closes successfully, S&P understands
that Odeon will become a core subsidiary of AMC.  S&P therefore
anticipates that it will likely align the ratings on Odeon with
those on AMC.

"In March 2016, we placed our ratings on AMC on CreditWatch with
negative implications, reflecting our expectation for higher
leverage after the company announced its plan to acquire Carmike
Cinemas Inc.  On July 12, AMC stated that its acquisition of
Carmike is at considerable risk, given Carmike shareholders'
resistance to the acquisition price.  If AMC successfully
completes one or both of the proposed acquisitions, we believe
the combined company's adjusted leverage will likely be above our
5x leverage threshold for an aggressive financial risk profile
assessment when the transactions close.  AMC's actual leverage
was in the high-4x area as of March 31, 2016," S&P said.

"We don't expect the Odeon acquisition to affect AMC's fair
business risk profile assessment, though it will increase the
size, scale, and diversification of the company's exhibition
assets.  This should provide some benefit in film rental and
concession negotiations for the combined entity.  Still, although
the Odeon acquisition would diversify AMC's business by adding
European markets, it also presents some integration challenges.
AMC has experienced success in offering expanded concession
offerings and reseating theaters in the U.S., but it's unclear if
these significant investments would be as successful if
implemented in European markets," S&P noted.

S&P will resolve the CreditWatch placement when the transaction
closes and financing arrangements for AMC and Odeon are
finalized, which S&P understands is likely to occur by the end of
the fourth quarter of 2016.


* Company Insolvencies in Central, Eastern Europe Down in 2015
Countries in the Central and Eastern Europe region enjoyed
favorable economic conditions last year.  This led to an improved
situation for CEE businesses.

The number of insolvencies decreased over the course of 2015 in 9
out of 13 countries, while the GDP-weighted regional insolvency
average was -14%.  The region showed a varied picture, with
double-digit deterioration recorded in Ukraine and Lithuania,
whereas Romania and Hungary enjoyed significant improvements.
Coface forecasts that businesses will continue to take advantage
of supportive conditions and that company insolvencies will drop
by -5.3% in 2016.

While the largest emerging markets suffered from slowdowns in
growth -- or even recorded recessions -- CEE economies benefited
from an improved and favorable economic environment last year.
The average pace of regional GDP growth accelerated from +2.6% in
2014, to +3.3% in 2015.  The export industry profited from a slow
but gradual recovery of its main trading destination, the
Eurozone.  Moreover, the combination of further falls in
unemployment rates, rising wages, low inflation, depressed
commodity prices and historically low levels of interest rates,
made private consumption a key driver for growth.  Although CEE
economies had already been benefiting from EU co-financed
investments for some years, the pace of use accelerated in 2015,
as it was the final year of access to EU financing budgeted for
the years 2007-2013.  These investments made a significant
contribution to the growth recorded by CEE economies last year.

The dynamics of insolvencies varied between CEE economies.  The
strongest decrease, of almost -50%, was recorded by Romania,
which benefited from significant fiscal stimuli. The highest
increase, of +20.8%, was recorded by Ukraine, which experienced
another year of recession as a result of the conflict with
Russia.  In the sectorial breakdown, sectors directly dependent
on household consumption profited from growing demand, although
high saturation, intense competition and low margins meant that
trade companies still figured strongly in the insolvency splits.
The construction sector benefited from EU co-financed projects
last year but payment behavior is still weak and construction
companies remain present in the insolvency statistics. Last year
almost 1% of active businesses in the CEE region became

For most countries, the level of insolvencies has not yet
returned to the pre-crisis levels of 2008.  In the Czech
Republic, insolvencies were almost 4 times higher than in 2008,
in Poland 1.8 times higher and in Slovenia 2.2 times higher.  At
the same time, company insolvencies in Slovakia and Romania are
still below pre-crisis levels.

Overall, however, 2015 insolvency statistics paint a more
positive picture of CEE companies.  This trend should persist, as
corporates continue to benefit from the favorable economic
environment, especially when compared to the turmoil being
experienced by many other emerging economies.  The regional
improvement is confirmed by Coface's country risk assessments,
which included several upgrades this year. In January, Hungary's
assessment was raised to A4, while in June Latvia was upgraded to
A4, Lithuania to A3, Romania to A4 and Slovenia to A3. Most CEE
countries have thus moved to acceptable risk levels.

Positive Outlook: Favorable Business Conditions in 2016

"Business conditions will remain supportive but less so than last
year" said Grzegorz Sielewicz, Region Economist Coface Central
Eastern Europe.  "We forecast that insolvencies will decline by -
5.3% for the full year of 2016."  Further improvements in the
labour market, along with growing confidence, will reinforce
household consumption as the main growth driver for CEE
economies.  The contribution of investments will not be as high
as last year, due to a slow start to new EU co-financed projects.
This is weakening the expansion of the construction sector and
various other industries associated with it.

On the external side, CEE countries will remain active exporters,
although the slowdown of global trade could hamper their
ambitions.  Global turbulence, including the steeper Chinese
slowdown -- which particular affects Germany, the CEE's main
partner -- could diminish export dynamics.


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

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

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


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

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

Copyright 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.  Additional e-mail subscriptions for
members of the same firm for the term of the initial subscription
or balance thereof are US$25 each.  For subscription information,
contact Peter Chapman at 215-945-7000 or Nina Novak at

                 * * * End of Transmission * * *