/raid1/www/Hosts/bankrupt/TCRLA_Public/060613.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
L A T I N A M E R I C A
Tuesday, June 13, 2006, Vol. 7, Issue 116
Headlines
A R G E N T I N A
COPACABANA ADORNOS: Proofs of Claim Verification Ends on July 21
DEVELOP SA: Verification of Proofs of Claim Ends on July 16
ERMACON SA: Trustee Will Validate Proofs of Claim Until Aug. 7
LEGEND SA: Trustee Won't Verify Proofs of Claim After Aug. 10
M.S.B. CONSTRUCCIONES: Concludes Reorganization Proceeding
NUESTRA ALDEA: Last Day for Verification of Claims Is on Aug. 10
PREDIO RETIRO: Sets Aug. 15 Deadline for Verification of Claims
RAPILIM SA: Gets Court Approval to Reorganize Business
TROMEN SA: Enters Bankruptcy on Court Orders
UNION RECIBIDORES: Asks Court Approval to Restructure Debts
B E L I Z E
* BELIZE: Blue Diamond Pursues Construction of Ethanol Facility
B E R M U D A
BAY POINT RE: Moody's Rates US$125M Sr. Secured Loan at (P)Ba2
FOSTER WHEELER: Bechtel Awards Boiler Contract to Subsidiary
INTELSAT LTD: Moody's Affirms B2 Corporate Family Rating
INTELSAT LTD: S&P Affirms Corporate Credit Rating at BB-
LORAL SPACE: Enters Into Consulting Agreement With Dean Olmstead
B R A Z I L
ADVANCED MEDICAL: Fitch Lowers Issuer Default Rating to B+
ADVANCED MEDICAL: Moody's Affirms Low B Ratings
ADVANCED MEDICAL: S&P Rates US$450-Mil. Convertible Debt at B
BANCO ITAU: S&P Places CounterParty Credit Rating at BB+/B
BANCO NACIONAL: Disbursements to Railway Sector Up 100% in 2006
* BRAZIL: Fitch Issues Sovereign Report on Debt Rollovers
C A Y M A N I S L A N D S
FARIPSA LIMITED: Last Day to File Proofs of Claim Is on July 3
HEATON PROPERTIES: Sets July 3 Deadline to File Proofs of Claim
INFOR GLOBAL: Liquidator Presents Wind Up Accounts on June 30
INFOR INTERMEDIATE: Sets June 30 Final Shareholders Meeting
INVIERNO HOLDINGS: Creditors Must File Proofs of Claim by July 3
IZUMIGAOKA INVESTORS: Final General Meeting Is on June 30
LABMORGAN INT'L: Schedules Final General Meeting on June 30
LATIN AMERICA ENT: Final Shareholders Meeting Set for June 30
MALIPUS LIMITED: Proofs of Claim Must be Filed by July 3
QUARTZ FINANCE: Holds Last Shareholders Meeting on June 30
SHINJUKU INVESTORS: Holding Final General Meeting on June 30
D O M I N I C A N R E P U B L I C
FALCONBRIDGE LTD: Revises Common Share Stock Symbol to FAL
E L S A L V A D O R
* EL SALVADOR: Pres. Saca Defends Free Trade for Latin America
J A M A I C A
CENTURY ALUMINUM: Posts US$141.5M Net Loss for 1st Quarter 2006
M E X I C O
CORPORACION INTERAMERICANA: Moody's Affirms Ba2 Ratings
FORD MOTOR: Fitch Downgrades Issuer Default Rating to B+ from BB
HSBC MEXICO: Moody's Revises D+ Rating's Outlook to Positive
J.L. FRENCH: Court Approves US$255MM Goldman & Morgan Exit Pact
P U E R T O R I C O
DORAL FIN'L: Indenture Trustee Wants Report Filed by Dec. 31
DORAL FINANCIAL: Fitch Maintains Ratings on Watch Negative
DORAL FINANCIAL: S&P Lowers LT CounterParty Credit Rating to B+
INTERLINE BRANDS: Maturity Yield of Sr. Notes Due 2014 Is 8.250%
INTERLINE BRANDS: S&P Affirms BB- Corporate Credit Rating
INTERLINE BRANDS: 11-1/2 Senior Notes Will Yield 5.629%
MAXXAM INC: March 31 Balance Sheet Upside-Down by US$671.3 Mil.
V E N E Z U E L A
ARVINMERITOR INC: S&P Puts BB+ Rating on US$1.05 Bil. Bank Debt
- - - - -
=================
A R G E N T I N A
=================
COPACABANA ADORNOS: Proofs of Claim Verification Ends on July 21
----------------------------------------------------------------
Marcelo Fabian Francisco, court-appointed trustee for the
bankruptcy case of Copacabana Adornos S.R.L. has started
verifying creditors' proofs of claim. Verification phase will
end on July 21, 2006.
La Nacion relates that Buenos Aires' Court No. 17 declared the
company bankrupt at the request of Pablo Gomez, whom the company
owes US$33,345.40.
Clerk No. 33 assists the court in this case.
The debtor can be reached at:
Copacabana Adornos S.R.L.
Jean Jaures 56
Buenos Aires, Argentina
The trustee can be reached at:
Marcelo Fabian Francisco
Uruguay 328
Buenos Aires, Argentina
DEVELOP SA: Verification of Proofs of Claim Ends on July 16
-----------------------------------------------------------
The court-appointed trustee, Jose Larrory, will verify
creditors' proofs of claim until July 18, 2006, for the
bankruptcy proceeding of Develop S.A., La Nacion reports.
Creditors who fail to submit the required documents will not
qualify for any post-liquidation distributions.
Buenos Aires' Court No. 25 declared the company bankrupt at the
behest of Obra Social de los Empleados de Comercio y Actividades
Civiles, which the company owes US$23,662.58.
Clerk No. 49 assists the court on the case.
The debtor can be reached at:
Develop S.A.
Gualeguaychu 2041
Buenos Aires, Argentina
The trustee can be reached at:
Jose Larrory
Rodriguez Pena 231
Buenos Aires, Argentina
ERMACON SA: Trustee Will Validate Proofs of Claim Until Aug. 7
--------------------------------------------------------------
The court-appointed trustee, Eva Malvina Gorsd, for the
bankruptcy proceeding of Ermacon S.A. will verify creditor's
proofs of claim until Aug. 7, 2006. Creditors who fail to
submit the required documents will not qualify for any post-
liquidation distributions.
The verified claims will be used as basis for creating
individual reports that Ms. Gorsd must present in court on
Sept. 19, 2006. A general report that contains and audit of the
company's accounting and banking records will follow on
Nov. 1, 2006.
Buenos Aires' Court No. 11 declared the company bankrupt at the
request of Jose Silvano Gonzalez, whom the company owes
US$8,846.09.
Clerk No. 22 assists the court on the case.
The debtor can be reached at:
Ermacon S.A.
Valentin Gomez 2708
Buenos Aires, Argentina
The trustee can be reached at:
Eva Malvina Gorsd
Paraguay 1225
Buenos Aires, Argentina
LEGEND SA: Trustee Won't Verify Proofs of Claim After Aug. 10
-------------------------------------------------------------
Maria Marta Porolli, the court-appointed trustee for the
bankruptcy case of Legend S.A. has started verifying creditors'
proofs of claim. Ms. Porolli won't verify claims after
Aug. 10, 2006.
La Nacion relates that Buenos Aires' Court No. 4 declared the
company bankrupt at the behest of Carrefour Argentina S.A.,
which has claims amounting to US$60,962.52 against the company.
Clerk No. 8 assists the court in this case.
The debtor can be reached at:
Legend S.A.
Alsina 1170
Buenos Aires, Argentina
The trustee can be reached at:
Maria Marta Porolli
Tucuman 1455
Buenos Aires, Argentina
M.S.B. CONSTRUCCIONES: Concludes Reorganization Proceeding
----------------------------------------------------------
The reorganization of M.S.B. Construcciones has been concluded.
Data revealed by Infobae on its Web site indicated that the
process was concluded after a court in Cordoba approved the debt
agreement signed between the Company and its creditors.
The debtor can be reached at:
M.S.B. Construcciones S.R.L.
Avenida Circunvalacion Sur, entre Avenida Velez
Sarsfield y Avda Las Rosas
Cordoba, Argentina
NUESTRA ALDEA: Last Day for Verification of Claims Is on Aug. 10
----------------------------------------------------------------
Court-appointed trustee Manuel Alberto Cibeira won't validate
creditors' proofs of claim against bankrupt company Nuestra
Aldea S.A. after Aug. 10, 2006, Infobae reports.
Mr. Cibeira will present the validated claims in court as
individual reports on Oct. 9, 2006. The trustee will also
submit a general report on the case on Nov. 11, 2006.
A Buenos Aires court handles the company's bankruptcy case.
The trustee can be reached at:
Manuel Alberto Cibeira
Avenida Cordoba 1247
Buenos Aires, Argentina
PREDIO RETIRO: Sets Aug. 15 Deadline for Verification of Claims
---------------------------------------------------------------
Mario Isaac Bekierman, the court-appointed trustee for Predio
Retiro S.A.'s bankruptcy case, has started verifying creditors'
proofs of claim. The verification phase will end on
Aug. 15, 2006.
The verified claims will be used as basis for creating
individual reports that are due in court on Sept. 27, 2006. A
general report is expected on Nov. 9, 2006.
Buenos Aires' Court No. 14, with assistance from Clerk No. 28,
declared the company bankrupt at the request of Nazareno
Montemarani, whom the company owes US$96,987.15
The debtor can be reached at:
Predio Retiro S.A.
Antartida Argentina 1160
Buenos Aires, Argentina
The trustee can be reached at:
Mario Isaac Bekierman
Avenida Raul Scalabrini Ortiz 258
Buenos Aires, Argentina
RAPILIM SA: Gets Court Approval to Reorganize Business
------------------------------------------------------
Rapilim S.A. will begin reorganization following the approval of
its petition by a court in Rosario, Santa Fe. The opening of the
reorganization will allow the Company to negotiate a settlement
with its creditors in order to avoid a straight liquidation.
A court-appointed trustee, whose name is yet to be disclosed,
will oversee the reorganization proceedings. The trustee will
verify creditors' proofs of claim and will present individual
reports in court based on the validated claims.
The trustee is also required by the court to submit a general
report essentially auditing the Company's accounting and
business records as well as summarizing important events
pertaining to the reorganization.
An Informative Assembly will also follow wherein the settlement
proposal will be presented to the Company's creditors for
approval.
The debtor can be reached at:
Rapilim S.A.
Tucuman 1059, Rosario
Santa Fe, Argentina
TROMEN SA: Enters Bankruptcy on Court Orders
--------------------------------------------
Tromen S.A. enters bankruptcy protection after a Buenos Aires
court ordered the Company's liquidation. The order effectively
transfers control of the Company's assets to a court-appointed
trustee, whose name is yet to be disclosed, who will supervise
the liquidation proceedings.
Argentine bankruptcy law requires the trustee to provide the
court with individual reports on the forwarded claims and a
general report containing an audit of the Company's accounting
and business records.
The verification deadline and the dates of submission of these
reports are yet to be disclosed.
The debtor can be reached at:
Tromen S.A.
San Martin 66
Buenos Aires, Argentina
UNION RECIBIDORES: Asks Court Approval to Restructure Debts
-----------------------------------------------------------
Union Recibidores de Granos y Anexos de la Republica Argentina,
a company operating in Buenos Aires, has requested for
reorganization after failing to pay its liabilities since
May 2, 2006.
The reorganization petition, once approved by the court, will
allow the Company to negotiate a settlement with its creditors
in order to avoid a straight liquidation.
The case is pending before Buenos Aires' Court No. 9, with
assistance from Clerk No. 18.
The debtor can be reached at:
Union Recibidores de Granos y Anexos de la
Republica Argentina
Juan de Garay 460
Buenos Aires, Argentina
===========
B E L I Z E
===========
* BELIZE: Blue Diamond Pursues Construction of Ethanol Facility
---------------------------------------------------------------
Blue Diamond Ventures, Inc., disclosed that it is moving forward
with its goal to build goat processing facilities and an ethanol
plant.
Last month, Blue Diamond submitted to the Belizean government a
formal proposal for the purchase of the Libertad Sugar Factory.
The Government of Belize, acting through the Ministry of
Agriculture, acknowledged their receipt of the proposal and
responded they are not in a position to act on the offer from
Blue Diamond until a stand-still period of approximately 45 days
has expired due to feasibility studies being carried out as a
result of a recent Memorandum of Understanding.
"Although the government has issued this standstill period, we
are aggressively pursuing other options including sites outside
of Belize," said Blue Diamond CEO, John Quincey Moaning. "We
are confident that within a short period of time we will have a
site located and we will begin construction of our ethanol
production facility."
About Blue Diamond Venutres
Blue Diamond Ventures, Inc. -- www.bluediamondventures.com -- is
an agriculture, bio fuels and commercial development company
with operations in Belize and the U.S. Blue Diamond's business
plan includes ethanol production, tilapia and shrimp aqua
farming and raising thousands of acres of soybeans. The company
recently completed an audit to be listed on the NASDAQ Bulletin
Board.
About Belize
Belize lies on the eastern or Caribbean coast of Central
America, bounded on the north and part of the west by Mexico,
and on the south and the remainder of the west by Guatemala. The
Country's natural resources include arable land potential,
timber, fish, andhydropower.
Moody's Investor Service assigned these ratings to Belize:
-- CC LT Foreign Bank Depst Caa3
-- CC LT Foreign Curr Debt Caa3
-- CC ST Foreign Bank Depst NP
-- CC ST Foreign Curr Debt NP
-- LC Curr Issuer Rating Caa3
-- FC Curr Issuer Rating Caa3
-- Foreign Currency LT Debt Caa3
-- Local Currency LT Debt Caa3
Standard & Poor's Rating Service assigned these ratings to
Belize:
-- Foreign Currency LT Debt CCC-
-- Local Currency LT Debt CCC+
-- Foreign Currency ST Debt C
-- Local Currency ST Debt C
=============
B E R M U D A
=============
BAY POINT RE: Moody's Rates US$125M Sr. Secured Loan at (P)Ba2
--------------------------------------------------------------
Moody's Investors Service assigned a provisional (P)Ba2 rating
to the senior secured term loan, up to US$125 million, of
Bermuda-domiciled Bay Point Re Ltd. The outlook for the
provisional rating is stable. Moody's noted that it expects to
confirm this rating -- as well as Bay Point Re's provisional
(P)Baa3 insurance financial strength rating -- upon review of
final executed documentation for both Bay Point Holdings Ltd and
Bay Point Re, provided the documentation is consistent with the
terms and conditions specified to date that underlie the
provisional ratings. Concurrently, and to reflect that the term
loan facility is being arranged at Bay Point Re Ltd, rather than
at its holding company, Moody's has withdrawn its provisional
(P)Ba2 senior secured credit facility rating of Bay Point
Holdings Ltd.
The privately-placed senior secured term loan of Bay Point Re,
which is being syndicated to financial institutions and other
institutional lenders under Section 144A guidelines, is
scheduled to mature on December 31, 2010. The loan is secured
by the capital stock of Bay Point Re, and is non-amortizing, but
allows for voluntary prepayments, requires mandatory prepayments
under certain circumstances, and is callable at a premium.
According to Moody's, Bay Point Holdings is a privately held
holding company for Bay Point Re, a newly formed Class 3
licensed Bermuda reinsurer that has entered into a quota-share
reinsurance treaty with Bermuda-based Harbor Point Re Limited.
Bay Point Re will assume specified percentages (up to 50%) of
certain lines of reinsurance -- including property, marine,
energy and certain other lines of business underwritten by
Harbor Point Re Limited for the 2006 and 2007 underwriting
years, commencing January 1, 2006 through and including
December 31, 2007.
Initial capitalization for Bay Point Re is expected to be up to
US$250 million, comprised of:
-- up to US$125 million in a senior secured term loan but
equal to 50% of total capitalization,
-- cumulative preferred shares of up to US$75 million, or
30% of total capitalization and
-- common equity of up to US$50 million, or 20% of total
capitalization.
The company's capital and risk assumption capacity -- or
"minimum capital cushion" - is gauged to support a maximum risk
load over the life of the transaction as calibrated by the
greater of two tests, one involving the ratio of maximum
projected in-force premiums, and the other involving a
combination of modeled return-periods for the in-force
portfolio. Bay Point Re will post its total paid-in capital as
cash and securities into a trust to collateralize its
reinsurance obligations to Harbor Point Re Limited. Investment
holdings are expected to be entirely investment-grade, with an
average quality toward the high end of rating spectrum, and a
duration that is reasonably matched to Bay Point's expected
liability duration. Moody's analysis focused on both structural
and contractual features of the Bay Point vehicle, as well as
stochastic analysis of the company's existing and expected
underwriting and investment portfolios, and its expense and
capital structures, which were components of analyzing both the
probability of loss, and expected severity of loss for both Bay
Point Re's debt-holders, and its policyholders. Under the terms
of the senior secured term loan facility, Bay Point Re's debt
obligations are expressly subordinated to its policyholder
claims.
Moody's stated that Bay Point Re's ratings primarily reflect the
company's capitalization level and balance sheet that is
unencumbered by legacy exposures, structural characteristics
that are designed to offer protection to debt investors, and its
conservative investment policy. The rating agency stated that
these fundamental strengths are significantly tempered by Bay
Point Re's relatively high debt leverage profile (50% for the
term loan, 80% including the cumulative preferred shares, which
are subordinated to both Bay Point Re's policyholder and senior
creditor liabilities), the inherent underwriting volatility of
its catastrophe-exposed reinsurance portfolio, some uncertainty
about the overall risk composition of its portfolio over time
-- given its multi-line and global span, and by parameter risk
in the assumptions underlying the risk modeling that forms the
basis of the company's capitalization.
Moody's further noted that its expectations at the current
rating level are that Bay Point Re and Bay Point Holdings will
continue to maintain a financial leverage profile at no more
than 50% debt to total capital and that shareholders' equity
will not decline by more than 15% over a 12 month period. That
said, the rating agency noted that the ratings will likely
reflect updated analysis of the cumulative performance of the
company, its future overall risk-adjusted capitalization level,
and updated prospective probabilistic analysis of its
reinsurance portfolio at future points in time.
This provisional rating has been assigned:
Bay Point Re Ltd.
-- senior secured term loan due 2010: (P)Ba2.
This provisional rating has been withdrawn:
Bay Point Holdings Ltd.
-- senior secured term loan due 2010: (P)Ba2.
Bay Point Holdings Ltd., based in Bermuda, is the holding
company for Bay Point Re Ltd., which is a licensed Class 3
Bermuda insurer that has entered into a quota-share reinsurance
treaty with Bermuda-based Harbor Point Re Limited pursuant to
which Bay Point Re will assume specified percentages of certain
lines of reinsurance business underwritten by Harbor Point on
behalf of ceding companies for the 2006 and 2007 underwriting
years.
FOSTER WHEELER: Bechtel Awards Boiler Contract to Subsidiary
------------------------------------------------------------
Foster Wheeler Ltd. disclosed that Foster Wheeler North America
Corp., an operating unit of its Global Power Group, has been
awarded a contract by Bechtel Power Corporation for the design
and supply of two circulating fluidized-bed or CFB boilers.
The contract, valued in excess of US$100 million, calls for
Foster Wheeler to supply two 315-megawatt CFB boilers for a new
solid-fuel power plant that Bechtel Power is designing and
constructing for TXU Corp. The new plant will be located at
TXU's Sandow Steam Electric Station in Rockdale, Texas. The new
CFBs have been designed to use local lignite fuel and will
provide high-pressure steam to a single steam reheat turbine.
The award will be included in Foster Wheeler's second-quarter
2006 bookings.
"We are very excited about this important award which
underscores Bechtel's and TXU's confidence in both our CFB
technology and our company. This is another good example of how
the environmentally friendly CFB technology can bring high
economic value to utility power generation," said James Crumm,
president and CEO of Foster Wheeler North America.
Foster Wheeler's scope of services includes the design and
supply of the state-of-the-art CFB boilers and selective non-
catalytic reduction systems. The advanced boilers will burn low
calorific solid fuel cleanly while meeting stringent emissions
requirements. Construction at the site is expected to begin in
second quarter of 2006, with commercial operation scheduled for
summer 2009.
About Bechtel Corp.
Headquartered in San Francisco, California, Bechtel Corp.
-- http://www.bechtel.com/-- is a global engineering,
construction and project management company with more than a
century of experience on complex projects in challenging
locations. It serves clients in the energy, chemical, oil, gas,
environmental, defense, aerospace, telecommunications,
infrastructure, mining and smelter markets. It has over US$18
billion in annual revenues, and employs approximately 40,000
people at its offices and operations around the world. The
company has been the top ranked U.S. contractor 8 years running.
About TXU Corp.
TXU Corp., a Dallas-based energy company, manages a portfolio of
competitive and regulated energy businesses primarily in Texas.
About Foster Wheeler Ltd.
Headquartered in Hamilton, Bermuda, Foster Wheeler Ltd.
-- http://www.fwc.com/-- is a global company offering, through
its subsidiaries, a broad range of engineering, procurement,
construction, manufacturing, project development and management,
research and plant operation services. Foster Wheeler serves
the refining, upstream oil and gas, LNG and gas-to-liquids,
petrochemical, chemicals, power, pharmaceuticals, biotechnology
and healthcare industries.
At Dec. 31, 2005, Foster Wheeler's balance sheet showed a
US$341,796,000 equity deficit compared to a US$525,565,000
equity deficit on Dec. 31, 2004.
* * *
As reported in the Troubled Company Reporter on May 25, 2006,
Standard & Poor's Ratings Services raised Foster Wheeler's
corporate credit rating to to B+ from B- and its senior secured
notes rating to B+ from CCC+. At the same time, Standard &
Poor's assigned its 'BB-' bank loan rating and '1' recovery
rating to the company's five-year, US$250 million credit
facility due 2010.
* * *
On May 26, 2006, Moody's Investors Service upgraded Foster
Wheeler's corporate family rating to B1 from B3 and assigned
a Ba3 rating to FWC's US$250 million senior secured bank
revolving credit facility. The rating outlook is changed to
Positive.
INTELSAT LTD: Moody's Affirms B2 Corporate Family Rating
--------------------------------------------------------
Moody's Investors Service has affirmed the B2 corporate family
rating of Intelsat, Ltd., and downgraded the corporate family
rating of PanAmSat Corporation to B2, given the greater clarity
regarding the final capital structure and the near-term
completion of the PanAmSat acquisition by Intelsat.
At closing of the acquisition, PanAmSat Corporation's corporate
family rating will be withdrawn. Moody's has also assigned a B2
rating to the new US$750 million senior guaranteed notes and
assigned a Caa1 rating to the new senior notes at Intelsat
(Bermuda) Ltd. In addition, Moody's assigned a Caa1 rating to
the new PanAmSat Holding Corp. senior notes, and downgraded PAS
Holdings' existing senior discount notes to Caa1 from B3.
Moody's has also assigned a B2 rating to the new US$575 million
senior notes at PanAmSat Corp. The proceeds from the new
financings will be used to fund the US$3.2 billion cash portion
of the PanAmSat acquisition. The outlook on both Intelsat's and
PanAmSat's ratings is changed to stable from developing. In
addition, Moody's assigned new B1 ratings to the amended and
restated senior secured credit facilities at Intelsat and
PanAmSat. The ratings on the existing Intelsat and PanAmSat
senior secured credit facilities have been affirmed and will be
withdrawn at closing.
Moody's has taken these ratings actions:
Intelsat Ltd:
-- Corporate family rating: Affirmed at B2,
-- SGL Rating: Affirmed at SGL-2,
-- 5.25% Global notes, due 2008: Downgraded to Caa2
from Caa1,
-- 7.625% Sr. Notes, due 2012: Downgraded to Caa2
from Caa1, and
-- 6.5% Global Notes, due 2013: Downgraded to Caa2
from Caa1.
Intelsat (Bermuda) Ltd.:
-- New Guaranteed Sr. Notes: Assigned B2,
-- New Sr. Notes: Assigned Caa1, and
-- Sr. Discount Notes, due 2015: Downgraded to Caa1 from
B3 (these notes will be moved to Intelsat Intermediate
Holding Company Ltd. Upon closing of the merger).
Intelsat Subsidiary Holding Company Ltd.:
-- Guaranteed Sr. Secured Revolver, due 2012: Assigned B1,
-- Guaranteed Sr. Secured T/L B, due 2013: Assigned B1,
-- Guaranteed Sr. Secured Revolver, due 2011: Affirmed at
B1,
-- Guaranteed Sr. Secured T/L B, due 2011: Affirmed at B1,
-- Sr. Floating Rate Notes, due 2012:Affirmed at B2,
-- 8.25% Sr. Notes, due 2013: Affirmed at B2, and
-- 8.625% Sr. Notes, due 2015: Affirmed at B2.
Moody's has changed the outlook to stable from developing.
PanAmSat Holding Corporation:
-- Sr. discount global notes, due 2014: Downgraded to Caa1
from B3, and
-- New Sr. Notes: Assigned Caa1.
PanAmSat Corporation:
-- Corporate family rating: Downgraded to B2 from Ba3.
-- New Sr. Notes: Assigned B2,
-- Guaranteed Sr. Secured Revolver, due 2012: Assigned B1,
-- Guaranteed Sr. Secured Loan A, due 2013: Assigned B1,
-- Guaranteed Sr. Secured Loan B, due 2013: Assigned B1,
-- Guaranteed Sr. Secured Revolver, due 2009: Affirmed at
Ba3,
-- Guaranteed Sr. Secured Loan A, due 2009: Affirmed at
Ba3,
-- Guaranteed Sr. Secured Loan B, due 2011: Affirmed at
Ba3,
-- 6.375% senior secured notes, due 2008: Downgraded to B1
from Ba3,
-- 6.875% senior secured debentures, due 2028: Downgraded
to B1 from Ba3, and
-- 9% senior notes, due 2014: Downgraded to B2 from B1.
Moody's has changed the outlook to stable from developing.
Moody's recognizes that the composition of the new debt
instruments will be finalized upon the conclusion of the
company's tender offer for the existing PAS Holdings senior
discount notes. If the tender offer is consummated, the
outstanding PAS Holdings senior discount notes will be repaid in
full, their rating will be withdrawn, and up to US$2.2 billion
of new senior notes will be issued at Bermuda Ltd. If the
tender offer is not carried out, the existing US$290 million PAS
Holdings senior discount notes will remain in place, up to
US$725 million in new senior notes will be issued at PAS
Holdings, and up to US$1.2 billion of new senior notes will be
issued at Bermuda Ltd. The assigned ratings will remain in
place for the relevant securities.
The ratings broadly reflect the company's high leverage and the
execution risk. Ordinary integration challenges will be
exacerbated by the complexity of managing two businesses and
meeting the demands of two separate investor, legal, and
regulatory constituents. Moody's also notes that given the
ownership composition of the new company, we believe that future
financial policies may continue to be more shareholder friendly.
The ratings benefit somewhat from the combined company's leading
position in the global fixed satellite service business, good
free cash flow, and the substantial US$8 billion backlog of
contracted future revenues. Intelsat Ltd's debt ratings were
downgraded due the addition of more structurally senior debt in
the capital structure. PanAmSat's and PAS Holdings' ratings
were downgraded due to the increased debt and the flexibility in
the new credit agreement and indentures allowing the upstreaming
of dividends to Bermuda Ltd., which Moody's believes gives it a
similar credit profile to Intelsat.
Intelsat, headquartered in Bermuda, is a satellite service
operator and is owned by Apollo Management, Apax Partners,
Madison Dearborn, and Permira. PanAmSat Corporation,
headquartered in Wilton, Connecticut, is one of the world's top
three satellite operators and was purchased in August 2004 by an
equity sponsor group led by Kohlberg, Kravis Roberts & Co. and
including The Carlyle Group, Providence Equity Partners and
management.
INTELSAT LTD: S&P Affirms Corporate Credit Rating at BB-
--------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB-' corporate
credit rating on Washington, D.C.-based Intelsat Ltd. and
subsidiaries.
At the same time, Standard & Poor's lowered its corporate credit
rating on PanAmSat Corp. and related entities to 'BB-' from
'BB'. All ratings are removed from CreditWatch, where they were
placed with negative implications on Aug. 29, 2005, following
the announcement of Intelsat's agreement to acquire PanAmSat for
US$3.2 billion cash for PanAmSat's equity and US$3.2 billion in
existing PanAmSat debt. Intelsat expects to complete the
acquisition in the second or third quarter of 2006.
"The corporate credit ratings on Intelsat and PanAmSat are based
on a consolidated analytical approach," said Standard & Poor's
credit analyst Eric Geil. "The ratings on PanAmSat were lowered
because of the pending ownership of this entity by the more-
leveraged consolidated Intelsat Ltd." The ratings on Intelsat
were affirmed, despite the increase in consolidated leverage
from the historical level because of strong discretionary cash
flow that we expect will be used to reduce consolidated debt to
EBITDA from the upper 7x debt to EBITDA area to a level more in
line with the rating at or below 7x.
At the same time, the rating agency assigned a 'B' rating to
Intelsat Bermuda Ltd.'s proposed offering of between US$1.16
billion to US$2.19 billion aggregate amount of nonguaranteed
senior notes due in 2013 and 2016, and a 'B+' rating to Intelsat
Bermuda Ltd.'s proposed offering of US$750 million senior notes
due 2016. Intelsat Subsidiary Holding Co. Ltd., the operating
subsidiary, guarantees the US$750 million notes.
Standard & Poor's also assigned a 'B' rating to the proposed
US$575 million senior notes due 2016 of PanAmSat Corp. and
assigned a 'B' rating to the proposed US$725 million senior
notes due 2016 of PanAmSat Holding Corp.
Total debt proceeds of about US$3.5 billion plus about US$200
million of cash on hand will be used to purchase PanAmSat's
equity for about US$3.2 billion, to tender for the US$290
million of PanAmSat's 10.375% discount notes due 2014, and for
fees and expenses. If the tender is completed, the proposed
US$725 million senior notes of PanAmSat Holding Corp. will not
be issued and a greater amount of the nonguaranteed senior notes
of Intelsat Bermuda will be issued.
The ratings on the combined Intelsat and PanAmSat primarily
reflect high financial risk from acquisition-related debt and a
demonstrated shareholder-oriented financial policy. Although
the company has indicated it will refrain from shareholder
distributions for one year following the transaction, the
company's historical financial policy suggests that it may make
substantial shareholder distributions over the medium term.
Other concerns include mature industry growth prospects,
declining demand for point-to-point satellite applications, and
modest risk of satellite failure.
Tempering factors include:
-- good cash flow predictability from a substantial combined
US$8.3 billion backlog of future revenue derived from long
term contracts as of March 31, 2006;
-- limited competition because of high barriers to entry and
orbital slot scarcity;
-- the essential nature of satellite services for point-to-
multipoint applications;
-- strong EBITDA margins and discretionary cash flow from low
variable costs; and
-- fixed-cost and capital expenditure saving opportunities
from combining Intelsat and PanAmSat.
Following completion of the PanAmSat acquisition, Intelsat will
be the largest global satellite services provider, ranking ahead
of SES Global S.A. in terms of revenue. The fixed satellite
services business has low investment-grade business risk
characteristics because of the essential nature of point-to-
multipoint services for key customers, including cable TV
networks and direct-to-home TV providers, and long-term
contracts that account for a majority of revenue.
The US$646 million senior secured credit facility of Intelsat
Subsidiary Holding Co. Ltd. is rated 'BB+' with a recovery
rating of '1', indicating the expectation of full recovery of
principal in the event of a payment default. This bank loan
rating is two notches higher than the 'BB-' corporate credit
rating on Intelsat Ltd.
The US$2.23 billion senior secured credit facility of PanAmSat
Corp. is rated 'BB' with a recovery rating of '1', indicating
the expectation of full recovery of principal in the event of a
payment default. This bank loan rating is one notch higher than
the 'BB-' corporate credit rating on Intelsat and PanAmSat.
LORAL SPACE: Enters Into Consulting Agreement With Dean Olmstead
----------------------------------------------------------------
Loral Space & Communications Inc. entered into a consulting
agreement with one of its directors, Dean A. Olmstead.
In addition to continuing his responsibilities as a member of
Loral's board of directors, Mr. Olmstead, will provide
consulting services to Loral relating to the exploration of
strategic and growth opportunities for Loral's satellite
services businesses and the achievement of efficiencies across
all of Loral's subsidiaries. Mr. Olmstead will report to
Michael B. Targoff, chief executive officer, Loral Space &
Communications.
"We are excited that Dean has accepted this additional,
important responsibility and are confident that he can
meaningfully advance Loral's objectives," commented Mr. Targoff.
"Dean is a veteran and a visionary in the satellite industry and
we are truly pleased to have him in this expanded role."
In addition to his positions at Loral, Mr. Olmstead is chairman
of the board of Satellite Development LLC. He was formerly
president and chief executive officer of SES Americom and a
member of the SES Global Executive Committee. He holds a B.S.
degree in Economics-Mathematics from Western Washington
University, an M.S. in Engineering Economic Systems from
Stanford University and has completed Ph.D. studies in Economics
at American University.
About Loral Space
Loral Space & Communications -- http://www.loral.com/-- is a
satellite communications company. It owns and operates a fleet
of telecommunications satellites used to broadcast video
entertainment programming, distribute broadband data, and
provide access to Internet services and other value-added
communications services. Loral also is a world-class leader in
the design and manufacture of satellites and satellite systems
for commercial and government applications including direct-to-
home television, broadband communications, wireless telephony,
weather monitoring and air traffic management.
The Company and various affiliates filed for chapter 11
protection (Bankr. S.D.N.Y. Case No. 03-41710) on July 15, 2003.
Stephen Karotkin, Esq., and Lori R. Fife, Esq., at Weil, Gotshal
& Manges LLP, represented the Debtors in their successful
restructuring and prosecution of their Fourth Amended Joint Plan
of Reorganization to confirmation on Aug. 1, 2005. As of
Dec. 31, 2004, the Company listed assets totaling approximately
US$1.2 billion and liabilities totaling approximately US$2.3
billion.
===========
B R A Z I L
===========
ADVANCED MEDICAL: Fitch Lowers Issuer Default Rating to B+
----------------------------------------------------------
Fitch lowered the issuer default rating on Advanced Medical
Optics to 'B+' and assigned the subsequent recovery ratings.
The ratings on AMO's bank debt and senior subordinated
convertible debt remain unchanged.
-- Issuer Default Rating: 'B+';
-- Senior Secured Credit Facility 'BB+'/'RR1'; and
-- Senior Subordinated Convertible Debt 'B+'/'RR4'.
The ratings apply to approximately US$1 billion of debt. The
Rating Outlook is Stable.
The ratings reflect the increase in AMO's debt levels, resulting
from the company's intention of repurchasing approximately
US$500 million in common stock and US$100 million in existing
senior subordinated convertible debt. To finance the
transactions, AMO will issue US$500 million of 3.25% senior
subordinated convertible debt due 2026, cash on hand and its
bank facility.
While leverage increases to approximately 5.7x using EBITDA from
the latest twelve months ending March 31, 2006, the company has
made meaningful progress in improving profitability during the
past 12 months. Fitch expects that this trend will continue.
AMO's integration and expansion of VISX, new product
introductions, and focus on core products with higher margins
should drive growth in profitability.
AMO generated free cash flow of roughly US$6 million for the LTM
ending March 31, 2006 (excluding one-time charges, FCF was in
excess of US$120 million). Fitch expects AMO will continue to
grow FCF. AMO has manageable capital expenditure requirements.
At March 31, 2006, AMO had approximately US$38 million in cash,
US$246 million availability (offset by US$9 million in letters
of credit) under a US$300 million revolver that expires in 2009.
AMO has no debt maturing during the next 10 years. However, a
total of US$500 million of debt is potentially putable to the
company in 2010 and 2011. At March 31, 2006, latest twelve
months interest coverage (EBITDA/interest) was 6.50x and
leverage (total debt/EBITDA) was 2.99x or (Adjusted Debt/FFO)
was 4.80x.
Advanced Medical Optics is a global provider of contact lens
products, ophthalmic surgical devices, and refractive devices.
ADVANCED MEDICAL: Moody's Affirms Low B Ratings
-----------------------------------------------
Moody's Investors Service affirmed Advanced Medical Optics,
Inc.'s existing ratings, following the company's announcement
that it is issuing, through a Rule 144A offering, up to US$500
million of convertible senior subordinated notes (US$450 million
plus up to an additional US$50 million subject to the initial
purchasers' option) due 2026. Moody's expects AMO to use the
net proceeds from the offering, and roughly US$100 million in
borrowings under its US$300 million senior credit facility, to
purchase US$500 million worth of its common stock, and up to
US$100 million of its outstanding convertible notes through
privately negotiated repurchases. Moody's does not rate the
proposed issue. Additionally, Moody's does not rate the US$150
million (private placement) convertible senior subordinated
notes due 2025.
The rating outlook remains stable.
Moody's affirmed these three ratings:
-- Corporate Family Rating: B1,
-- US$300 million Sr. Secured Revolver due 2009: B1, and
-- US$350 million Convertible Sr. Subordinated Notes due
2024: B3.
While Moody's typically believes that adding debt to the balance
sheet expressly for returning capital to shareholders weakens a
company's credit profile, we believe that the company's current
balance sheet and forward-looking cash flow can support the
additional debt at the B1 rating category. Additionally, margin
expansion and cash flow growth associated with AMO's product
rationalization strategy support the B1 rating. Moody's rating
affirmation also assumes that the company will refrain from
further share purchases, other than that necessary to offset the
dilutive effects of stock-based compensation. Doing so at the
continued expense of creditors could jeopardize the ratings.
The company's cataract surgery and implants business is AMO's
largest segment and comprises over 50% of its 2005 revenues.
AMO is the second largest player in this segment -- behind the
significantly better capitalized, Alcon Inc. (US$32 billion
market capitalization versus AMO's US$3 billion). The company's
reliance on cataract surgery equipment and implant devices for
over 50% of its revenues increases the probability that event
risk -- such as that faced by Bausch & Lomb with regard to its
ReNu with MoistureLoc lens care solution -- could have a
deleterious impact on AMO's operations thereby affecting its
ratings.
Moody's believes that topline growth will more likely stem from
acquisitions -- either as a complement to existing product lines
or as an entrance into new market segments such as contact
lenses. Moody's assumes that such acquisitions, if material,
would have a significant equity component with respect to
financing arrangements, as there is little room for additional
leverage at the current rating level unless AMO were to delever
materially.
The rating outlook is stable. Moody's could revise the outlook
to positive if the company continues to deliver on its product
rationalization strategy as evidenced by improving operating
margins and free cash flow over the next several quarters.
Moody's could upgrade the rating if CFO-to-adjusted debt (i.e.
adjusted for the capitalization of operating leases) exceeds 15%
and FCF-to-adjusted debt exceeds 10% on a sustained basis due to
growth among the company's higher margin businesses, such as
intraocular lenses, and continued rationalization among its
lower margin product lines.
Event risk and ensuing product litigation, such as that
currently faced by AMO's competitor, Bausch & Lomb, could
trigger a rating downgrade. AMO's failure to deliver on its
product rationalization strategy, stagnant organic revenue
growth, or margin deterioration caused by competitive or
reimbursement pressures could trigger a rating downgrade.
Specifically, cash flow from operations-to-adjusted debt below
5% or negative free cash flow on a sustained basis, and
additional material returns of capital to shareholders without
commensurate debt reduction could precipitate a rating
downgrade.
Advanced Medical Optics, headquartered in Santa Ana, CA, is a
global leader in the development, manufacturing and marketing of
ophthalmic surgical and contact lens care products. Sales for
the twelve months ended June 24, 2005 were approximately US$921
million.
ADVANCED MEDICAL: S&P Rates US$450-Mil. Convertible Debt at B
-------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' rating to
Advanced Medical Optics Inc.'s US$450 million convertible senior
subordinated debt due 2026, filed under a Rule 415 debt
registration. The proceeds, plus a drawdown on the company's
revolving credit facility, will be used to buy back US$500
million of common stock and US$100 million of outstanding
convertible notes. The corporate credit rating on
AMO is 'BB-' and the rating outlook is stable.
"Given that AMO's financial metrics are strong relative to the
'BB-' corporate credit rating, the company has sufficient
cushion to absorb the increase in leverage incurred from the
convertible debt issue," said Standard & Poor's credit analyst
Cheryl Richer.
The rating on Santa Ana, Calif.-based Advanced Medical Optics
Inc. reflects the risks associated with the ophthalmic company's
aggressive efforts to build upon its well-established position
as a midsize player in the industry. At the same time, however,
AMO's acquisitions have broadened its product and geographic
diversity. Opthalmic surgical products including:
-- intraocular lenses,
-- phacoemulsification equipment,
-- viscoelastics, and
-- laser vision correction
accounted for 67% of 2005 revenues, with eye care products (to
clean, disinfect, and rewet contact lenses) contributing 33%.
The company has demonstrated a willingness to use common equity
to finance its acquisitions.
In May 2005, it acquired VISX Inc. for US$1.27 billion. The
largely stock-financed transaction diversified AMO into the
laser vision correction area.
BANCO ITAU: S&P Places CounterParty Credit Rating at BB+/B
----------------------------------------------------------
Standard & Poor's Ratings Services placed its 'BB+/B'
counterparty credit rating to Banco Itau BBA S.A. The outlook
is stable.
"The ratings on Itau BBA reflect the credit quality of Banco
Itau S.A. (BB+/Stable/B) given Itau BBA's core importance for
the Itau conglomerate as it conducts the wholesale operation of
the group, therefore benefiting from Itau's solid brand-name
recognition and strong financial stance," said Standard & Poor's
credit analyst Tamara Berenholc. Itau BBA maintains a strong
position in the Brazilian wholesale market and counts on an
agile and qualified management team, which has been delivering
consistent track record of good profitability and asset quality
indicators.
The Itau conglomerate is the second-largest private financial
group in Brazil and in Latin America in terms of total assets.
Itau Holding Financeira S.A., which is liable before the Central
Bank for both operations, controls both Itau and Itau BBA.
Senior management and strategies are shared between the two
entities, and Itau BBA benefits from the group's strong
franchise and financial stance.
According to its pro forma balance sheet, which assumes that all
of the wholesale assets and liabilities were transferred to Itau
BBA's balance sheet, Itau BBA accounted for 26% of the group's
consolidated assets, 27% of its net income, and 35% of its
credit operations as of March 2006. Although we expect the
weight of Itau BBA's operations over the group's consolidated
assets and net income to reduce in the medium to long term given
the strong prospect for retail banking in Brazil, Itau BBA will
maintain its value to the conglomerate given the strong synergy
between the wholesale and retail businesses and its key role in
the group's strategy to increase cross selling and maintain a
diversified operation.
One of Itau BBA's strengths is its agile and sophisticated
management team, which is able to meet its clients' needs
through a quick delivery of customized products. This was made
possible by Itau's decision to maintain the operational
structure of the former Banco BBA as well as the autonomy of its
executives.
The stable outlook reflects the outlook on Banco Itau S.A. Any
change in the rating or outlook on Banco Itau should lead to a
similar rating action on Itau BBA.
BANCO NACIONAL: Disbursements to Railway Sector Up 100% in 2006
---------------------------------------------------------------
The disbursements from Banco Nacional de Desenvolvimento
Economico e Social aka BNDES to projects of the railway sector
forecast to 2006 sum up BRL1.2 billion, volume twice superior to
the BRL616 million released by the Bank last year. It regards
new investments in:
-- the wagon construction,
-- logistic bottlenecks reduction and
-- modernization in the existing system,
besides the resources destined to the start of the works of Nova
Transnordestina, which will create agriculture export hallways
in the Northeastern arid area, with the generation of 15
thousand direct jobs during the construction period and 70
thousand indirect jobs in the railway materials and equipment
industry.
Statistics allow concluding that 2006 will be a year of
consolidation of a new investment cycle in the sector, started
in 2003. Since then, the load transport grew from 345 million
tons to 389 million tons in 2005, an expansion of 6.6% per year.
The Brazilian success in exports, the improvement of the
regulatory environment, with the solution of some pendencies,
and some restructures reached to a new level of investments. In
the triennium 2003/2005, the annual average of resources ported
in the sector was BRL2.1 billion, volume three times superior to
the average of the period 2000/2002, of BRL703 million. In
2005, the investments reached a record level of BRL3.4 billion.
"The coordinate and pro-active actions of several agents of the
Federal Government created favorable conditions and stimulated,
in the past three years, the most important expansion of the
transport expansion occurred in Brazil in several decades", said
the president of BNDES, Demian Fiocca, in Brasilia, during a
lecture in the seminar Brazil on Trails.
With the retake of Brasil Ferrovias, the construction
integration railway in the Northeast Region, the amplification
of North-South Railway and the solution of logistic bottlenecks,
the perspectives are of an investment growth even higher. Up to
2010, the projections indicate to an amount of BRL11.3 billion
in railways or BRL2.3 billion per year. From this total, BNDES
will finance BRL6 billion, equivalent to BRL1.2 billion per
year.
BNDES is watching out the needs of the sector and aligned with
the Government actions, aiming at the railways integration and
adequacy, the reconstitution of the transport operation hallway
and the service exports and the increase of the domestic demand.
The Bank's efforts to extend the financings tot eh railway
industry were visible to several fronts.
Regional fomentation and bottlenecks
In the beginning of this year, the board of the Bank approved
special conditions:
-- Long Term Interest Rate (currently at 8.15% per year),
-- basic spread zero, and
-- term up to 15 years,
for the financing to projects destined to the logistic
bottleneck reduction, such as:
-- the elimination of level passages in urban environments,
-- the reduction of invasions at the domain area,
-- the cities circuit and
-- the improvement in the access to ports.
Currently, the Bank has in its portfolio five projects, which
sum up investments of BRL480 million. Up to 2010, the
perspective is that the demand reaches BRL1 billion.
Wagon acquisition
Last year, in the search of solutions to elevate the investments
in the sector, BNDES started to finance clients of railways
concessionaires for the acquisition of wagons. The effects of
this initiative are clear. The wagon production jumped from
294, in 2002, to 7500, in 2005, and shall reach 8000, in 2006.
Between 2004 and 2005, the Bank financed over 2.5 thousand
wagons, which summed up BRL500 million.
Brasil Ferrovias
The Bank supported the restructure of Brasil Ferrovias, with the
change of its interest in the group by shares of ALL, company
Level 2 of Bovespa, holding 12.8% of the total capital of ALL.
The performance of BNDES guaranteed the company's recovery,
which will receive investments of BRL2 billions up to 2010.
Besides, it will allow the credits recovery of BRL1.7 billion of
the Bank, from which BRL1.2 billion levied at loss, and BRL400
million of the Union. BNDES still had significant financial
gain in its capital share, of BRL150 million in less than a
year, equivalent to TJLP over 34% per year. With the
restructure, Brasil Ferrovias will reach transport capacity
superior to 40 million tons of grains in 2007, with forecast
investments of BRL2 billion up to 2010.
Logistic Fund
The board of the bank approved in the end of May the
participation of BNDESPAR, with BRL60 million, in a logistic
fund, with patrimony of BRL440 million. The fund, which is in
construction phase and will be administered by a private
management, will participate as shareholder of the wagon renter
companies and will perform buying quotas of companies, through
Specific Purpose Companies.
* * *
As reported in the Troubled Company Reporter on March 3, 2006,
Standard & Poor's Ratings Services raised its foreign currency
counterparty credit rating on Banco Nacional de Desenvolvimento
Economico e Social S.A. aka BNDES to 'BB' with a stable outlook
from 'BB-' with a positive outlook. The company's local
currency credit rating was also shifted to 'BB+' with a stable
outlook from 'BB' with a positive outlook.
* BRAZIL: Fitch Issues Sovereign Report on Debt Rollovers
---------------------------------------------------------
Fitch Ratings has released a Special Report on Brazil, "Brazil:
Watch Domestic Debt Profile & Rollovers," which argues that a
key driver of Brazil's sovereign credit story in the coming
months will be the ability of the Federal Treasury to roll over
its domestic debt and to limit any deterioration in the debt
profile, in light of recent volatility in the capital markets.
Roger Scher, Fitch's Managing Director for Latin American
Sovereign Ratings, will discuss the report in depth today,
June 13, 2006 at 10:30 EDT (15:30 BST).
Brazil's external balance sheet and balance of payments have
continued to improve and public sector external exposure has
been reduced since Oct. 11, 2005, when Fitch revised the Outlook
on Brazil's 'BB-' sovereign Issuer Default Rating to Positive
from Stable. As a result, Brazil's external financing risk has
been reduced, though by no means is it de minimus as can been
seen in price action during the latest market turbulence. Yet
the recent bout of volatility underscores Brazil's principal
vulnerability with respect to market sentiment; that is, in the
local domestic debt market, which in turn is not immune to
external shocks. Brazil's persistent heavy domestic-debt
rollover needs underscore what Fitch has argued since last fall,
namely, that improving public finances would be the key driver
of any future rating upgrade.
In spite of major strides made in paying down public external
debt and in reprofiling the domestic debt over the last three to
four years, Brazil's public sector has maintained roughly the
same heavy debt burden in GDP terms (approximately 75%), near-
term domestic debt maturities (in double digits in GDP terms),
and exposure to interest rates (nearly 70% of domestic debt
repricing over 12 months). Success in the domestic debt
auctions and improving the debt profile will depend not only on
market conditions, but also on the credibility of current and
likely future fiscal and monetary policies.
The Brazilian Federal Treasury cancelled a domestic debt auction
on May 25 due to market conditions. The Treasury re-entered
with a rather modest placement on June 2 of fixed-rate
securities (BRL3.9 billion), more than half of it for a short
seven-month maturity, and then again on June 8 with a placement
of (BRL9.8 billion), 57% of which were floating rate securities
and 21% were seven-month fixed-rate securities. The Treasury
has roughly 18% of GDP (BRL377 billion) of domestic debt held by
the public due in the 12 months from May 2006 (a high level of
annual debt maturities compared to other Fitch-rated
sovereigns), including BRL60 billion due in July. Therefore,
critical to improving sovereign creditworthiness will be smooth
sailing in the upcoming debt auctions, in addition of course to
continued positive trends in Brazil's balance of payments,
inflation, and interest rates, as well as efforts to stem the
recent slippage in public spending and the decline of the
primary budget surplus.
===========================
C A Y M A N I S L A N D S
===========================
FARIPSA LIMITED: Last Day to File Proofs of Claim Is on July 3
--------------------------------------------------------------
Faripsa Limited's creditors are required to submit proofs of
claim by July 3, 2006, to the company's liquidators:
Martin Pollock
Lana Farrington
Condor Nominee Limited
P.O. Box 487GT, 4th Floor
FirstCaribbean House
25 Main Street, George Town
Grand Cayman, Cayman Islands
Creditors who are not able to comply with the July 3 deadline
won't receive any distribution that the company will make.
Creditors are required to present proofs of claim personally or
through their solicitors.
Faripsa Limited's shareholders agreed on May 11,
2006, for the company's voluntary liquidation under Section 135
of the Companies Law (2004 Revision).
HEATON PROPERTIES: Sets July 3 Deadline to File Proofs of Claim
---------------------------------------------------------------
Creditors of Heaton Properties Limited, which is being
voluntarily wound up, are required to present proofs of claim by
July 3, 2006, to Martin Pollock and Lara Farrington, the
company's liquidator.
Creditors are required to present proofs of claim personally or
through their solicitors at the time and place that the
liquidator specified. Failure to present claims would mean
exclusion from any distribution that the company will make.
The company started liquidating assets on May 11, 2006.
The liquidators can be reached at:
Martin Pollock
Lana Farrington
Condor Nominee Limited
P.O. Box 487GT, 4th Floor
FirstCaribbean House
25 Main Street, George Town
Grand Cayman, Cayman Islands
INFOR GLOBAL: Liquidator Presents Wind Up Accounts on June 30
-------------------------------------------------------------
Prescott Ashe, the liquidator of wound up company Infor Global
Solutions Topco Ltd., will present accounts on the liquidation
during the final shareholders meeting on June 30, 2006 at:
Golden Gate Capital
One Embarcadero Center
33rd Floor, San Francisco
California, 94111, USA
As reported in the Troubled Company Reporter on June 8, 2006,
the company started liquidating assets on April 30, 2006.
Creditors were required to submit proofs of claim to the
company's liquidator on or before June 29, 2006
The liquidators can be reached at:
Prescott Ashe
Maples and Calder
P.O. Box 309 George Town
Ugland House, South Church Street, George Town
Grand Cayman, Cayman Islands
INFOR INTERMEDIATE: Sets June 30 Final Shareholders Meeting
-----------------------------------------------------------
Shareholders of Infor Intermediate Holdco Ltd. will gather for a
final meeting on June 30, 2006, at:
Golden Gate Capital
One Embarcadero Center
33rd Floor, San Francisco
California, 94111, USA
Accounts on the company's liquidation process will be presented
during the meeting.
As reported in the Troubled Company Reporter on June 8, 2006,
Info Intermediate started liquidating assets on April 30, 2006.
Creditors of the company were required to submit particulars of
their debts or claims on or before Juune 29, 2006, to the
company's appointed liquidator.
Parties-in-interest may contact the liquidator at:
Prescott Ashe
Maples and Calder
P.O. Box 309 George Town
Ugland House, South Church Street, George Town
Grand Cayman, Cayman Islands
INVIERNO HOLDINGS: Creditors Must File Proofs of Claim by July 3
----------------------------------------------------------------
Creditors of Invierno Holdings Limited are required to prove
their claims to Martin Pollock and Lara Farrington, the
company's liquidators, by July 3, 2006, or be excluded from
receiving any distribution or payment that the company will
make.
Creditors are required to send by July 3 their full names,
addresses, the full particulars of their debts or claims, and
the names and addresses of their lawyers, if any, to the
company's liquidators.
The company began liquidating assets on May 11, 2006.
The liquidator can be reached at:
Martin Pollock
Lana Farrington
Condor Nominee Limited
P.O. Box 487GT, 4th Floor
FirstCaribbean House
25 Main Street, George Town
Grand Cayman, Cayman Islands
IZUMIGAOKA INVESTORS: Final General Meeting Is on June 30
---------------------------------------------------------
The shareholders of Izumigaoka Investors will convene for a
final meeting on June 30, 2006, at 10:30 a.m. at the company's
registered office.
The parties will lay accounts before the meeting, showing how
the winding up has been conducted and how the property has been
disposed of.
The company's shareholders will also authorize the liquidators
to retain records for a period of five years from the
dissolution of the business, after which, they may be destroyed.
Any person who is entitled to attend and vote at this meeting
may appoint a proxy in his stead. A proxy need not be a member
or a creditor.
The liquidators can be reached at:
John Cullinane
Derrie Boggess
c/o Walkers SPV Limited
P.O. Box 908, George Town
Grand Cayman, Cayman Islands
Tel: (345) 914-6305
LABMORGAN INT'L: Schedules Final General Meeting on June 30
-----------------------------------------------------------
Labmorgan International Ltd. will hold its annual general
meeting on June 30, 2006, at the company's registered office.
These will be taken during the meeting:
1) accounting of the liquidation process showing how the
winding up has been conducted during the preceding year,
2) requesting the members' approval of the liquidation fees
incurred to date, approval of the liquidator's estimated
costs to completion, and
3) hearing any explanation that may be given by the
liquidator.
A member entitled to attend and vote at the meeting may appoint
a proxy, who need not be a member, in his stead.
The liquidator can be reached at:
James C. P. Berry
c/o P.O. Box 694 George Town
Grand Cayman, Cayman Islands
Attn: Ella K. Lockwood
Tel: (345) 949-8666
Fax: (345) 949-0626
LATIN AMERICA ENT: Final Shareholders Meeting Set for June 30
-------------------------------------------------------------
Shareholders of The Latin America Enterprise Steel Holding
L.D.C. will gather for a final meeting on June 30, 2006, at 1:00
p.m. at the company's registered office.
Accounts on the company's liquidation process will be presented
during the meeting. The shareholders will also authorize the
liquidators to retain the records of the company for a period of
six years, starting from the dissolution of the company.
Destruction of the records may then be allowed after such
period.
Any person who is entitled to attend and vote at this meeting
may appoint a proxy to attend and vote in his stead. A proxy
need not be a member or a creditor.
As reported in the Troubled Company Reporter on June 7, 2006,
the company started liquidating assets on Apr. 28, 2006.
Creditors of the company were required to submit particulars of
their debts or claims by June 11, 2006, to the company's
appointed liquidators.
Parties-in-interest may contact the liquidators at:
John Cullinane
Derrie Boggess
c/o Walkers SPV Limited
P.O. Box 908, George Town
Grand Cayman, Cayman Islands
Tel: (345) 914-6305
MALIPUS LIMITED: Proofs of Claim Must be Filed by July 3
--------------------------------------------------------
Malipus Limited's creditors are required to submit proofs of
claim by July 3, 2006, to the company's liquidator:
Martin Pollock
Lana Farrington
Condor Nominee Limited
P.O. Box 487GT, 4th Floor
FirstCaribbean House
25 Main Street, George Town
Grand Cayman, Cayman Islands
Creditors who are not able to comply with the July 3 deadline
won't receive any distribution that the company will make.
Creditors are required to present proofs of claim personally or
through their solicitors.
Malipus Limted's shareholders agreed on May 11, 2006, for
the company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision).
QUARTZ FINANCE: Holds Last Shareholders Meeting on June 30
----------------------------------------------------------
Shareholders of Quartz Finance Limited will gather on June 30,
2006, for a final general meeting at 2:00 p.m. at the company's
registered office.
Accounts on the company's liquidation process will be presented
during the meeting. The shareholders will also authorize the
liquidators to retain the records of the company for a period of
five years, starting from the dissolution of the company.
Destruction of the records may then be allowed after such
period.
Any person who is entitled to attend and vote at this meeting
may appoint a proxy to attend and vote in his stead. A proxy
need not be a member or a creditor.
As reported in the Troubled Company Reporter on June 7, 2006,
Quartz Finance started liquidating assets on May 16, 2006.
Verification of creditors' claims against GPF Almatis Holdings
will end on June 15, 2006.
The company's liquidators can be reached at:
John Cullinane
Derrie Boggess
c/o Walkers SPV Limited
P.O. Box 908, George Town
Grand Cayman, Cayman Islands
Tel: (345) 914-6305
SHINJUKU INVESTORS: Holding Final General Meeting on June 30
------------------------------------------------------------
Shinjuku Investors Ltd. will hold its annual general meeting
at 9:30 a.m. on June 30, 2006, at the company's registered
office.
These will be taken during the meeting:
1) accounting of the liquidation process showing how the
winding up has been conducted during the preceding year,
2) requesting the members' approval of the liquidation fees
incurred to date, approval of the liquidator's estimated
costs to completion, and
3) hearing any explanation that may be given by the
liquidator.
A member entitled to attend and vote at the meeting may appoint
a proxy, who need not be a member, in his stead.
The liquidators can be reached at:
John Cullinane
Derrie Boggess
c/o Walkers SPV Limited
P.O. Box 908, George Town
Grand Cayman, Cayman Islands
Tel: (345) 914-6305
===================================
D O M I N I C A N R E P U B L I C
===================================
FALCONBRIDGE LTD: Revises Common Share Stock Symbol to FAL
----------------------------------------------------------
Falconbridge Limited disclosed that as of June 12, 2006, the
Company's stock symbol for its common shares listed on the
Toronto Stock Exchange will be amended to "FAL". The new stock
symbol, which drops the ".LV" suffix, was assigned by the
Toronto Stock Exchange in light of its symbol extension program
having been discontinued.
About Falconbridge
Headquartered in Toronto, Ontario, Falconbridge Limited --
http://www.falconbridge.com/-- is a leading copper and nickel
company with investments in fully integrated zinc and aluminum
assets. Its primary focus is the identification and development
of world-class copper and nickel orebodies. It employs 14,500
people at its operations and offices in 18 countries. The
Company owns nickel mines in Canada and the Dominican Republic
and operates a refinery and sulfuric acid plant in Norway. It
is also a major producer of copper (38% of sales) through its
Kidd mine in Canada and its stake in Chile's Collahuasi mine and
Lomas Bayas mine. Its other products include cobalt, platinum
group metals, and zinc.
* * *
Falconbridge's CDN$150 million 5% convertible and callable bonds
due April 30, 2007, carries Standard & Poor's BB+ rating.
=====================
E L S A L V A D O R
=====================
* EL SALVADOR: Pres. Saca Defends Free Trade for Latin America
--------------------------------------------------------------
President Antonio Saca of El Salvador defends free trade as the
way to guarantee Latin America's progress and disapproves of
what he termed as "socialist experiments" made by his
counterparts in the region, especially in Bolivia and Venezuela,
the Financial times reports.
Pres. Saca told the FT in an interview that Latin America's
leaning towards socialism worries him because it destroys
liberties, commenting on a number of governments that have
practiced leftwing policies.
As previously reported, Bolivia's Pres. Evo Morales declared the
nationalization of the country's oil and gas industry on May 1,
2006, confiscating gas fields owned by foreign companies.
Meanwhile, Venezuela's Pres. Hugo Chavez withdrew its membership
from the Group of Three, a liberalization agreement between
Venezuela, Colombia and Mexico, in a move aimed at abandoning
trade deals with countries that have free-trade pacts with the
United States.
"Socialist experiments, state experiments end up bankrupting
countries," Pres. Saca told the FT. "We [in El Salvador] have
already lived through it. We had an agricultural reform that
was a disaster; we had a state takeover of the banks that was
mired in corruption. The state should be small but strong. It
should not get in the way."
Pres. Saca is a member of the Nationalist Republican Alliance or
Arena. He commented that Bolivia's political transformations
might not be the best choice for the government's growth and
development, the FT relates.
"I have to respect [the results of Bolivia's recent elections].
But you are asking me my opinion about whether I believe in that
[model]; I don't...I believe in open economies, in free trade. I
believe in justice," Pres. Saca told the FT.
Pres. Saca also disparaged Pres. Chavez' strategy of selling
cheap fuel to neighboring governments that supports his cause,
the FT says.
El Salvador's opposition party, the FMLN, is among those that
sympathize with Pres. Chavez' cause. Pres. Saca is not
surprised with this allegiance since the opposition accounts for
a "clear interference in the internal affairs of the country,"
he further adds to the FT.
Meanwhile, Pres. Saca related to the FT El Salvador's progress
as it implemented the Central American Free Trade Agreement with
the U.S. and countries in the region in April. He said that
exports upped 12% and the economy is projected to grow 3.5% for
this year versus the 2.8% in 2005.
Pres. Saca's administration was one of those that strongly
pushed for the CAFTA implementation in the region.
Giving credit to the liberal policies of four previous Arena
administrations since 1989 for the country's progress, Pres.
Saca told the FT, "We have broken the cycle of slow growth."
Pres. Saca further underlined his support for the free trade by
expressing his positivism for the Free Trade Area for the
Americas or FTAA even if it has encountered fierce opposition
from certain countries in Latin America. He defended that most
of the governments in the region are already involved in a trade
deal with the U.S. or are about to settle one, the FT relates.
* * *
Fitch Ratings assigned these ratings on El Salvador:
Rating Rating Date
------ -----------
Country Ceiling BB+ Jun. 18, 2004
Long Term IDR BB+ Dec. 14, 2005
Short Term IDR B Dec. 14, 2005
Local Currency
Long Term Issuer
Default Rating BB+ Dec. 14, 2005
=============
J A M A I C A
=============
CENTURY ALUMINUM: Posts US$141.5M Net Loss for 1st Quarter 2006
---------------------------------------------------------------
For the quarter ended March 31, 2006, Century Aluminum Company
reported a US$141,571,000 net loss out of US$346,946,000 in net
sales.
Century Aluminum's balance sheet at March 31, 2006 showed total
assets of US$1,883,066,000, total liabilities of
US$1,815,392,000 and shareholders' equity of US$67,674,000. The
Company's balance sheet also showed US$345,530,000 in total
current assets and US$524,698,000 in total current liabilities.
A full-text copy of Century Aluminum's quarterly report is
available for free at http://researcharchives.com/t/s?b2d
Headquartered in Monterey, California, Century Aluminum Company
-- http://www.centuryca.com/-- owns primary aluminum capacity
in the United States and Iceland, as well as an ownership stake
in alumina and bauxite assets in the United States and Jamaica.
* * *
Moody's assigned Century Aluminum Company's senior secured debt
and long-term corporate family ratings at B1. The ratings were
placed on April 22, 2003, with a positive outlook.
Standard & Poor's placed the Company's long-term local and
foreign issuer credit ratings at BB- with a stable outlook on
March 13, 2001.
===========
M E X I C O
===========
CORPORACION INTERAMERICANA: Moody's Affirms Ba2 Ratings
-------------------------------------------------------
Moody's Investors Service affirmed Corporacion Interamericana de
Entretenimiento, S.A. de C.V.'s Ba2 ratings and changed the
outlook to negative from stable. The change in the outlook was
based on weaker returns and higher capital expenditures, in
support of the company's investment program, than Moody's
expected when the rating was assigned.
Moody's affirmed two ratings:
-- Corporate Family Rating: Ba2, and
-- US$200 million Senior Unsecured Notes due 2015: Ba2
The rating outlook is negative.
Capital expenditures in the gaming business above Moody's
expectations and delayed value-added tax reimbursement from the
government contributed to constrain CIE's free cash flow in
2005. Moody's anticipates positive free cash flow in 2006,
based on management's commitment to more profit-oriented
investment, and expects higher revenue from the gaming business.
Failure to achieve this objective could have negative rating
implications.
In Moody's view, CIE main growth driver, the gaming business,
should become mature by the end of 2007/beginning of 2008.
However, improvements in cash flows from gaming starting in 2006
will be important for the group to reduce leverage and credit
risk. Moody's believes that management's stronger focus on
profitability, as evidenced by recent assets dispositions and
the implementation of a risk committee that accepts events from
the Entertainment division as per target return rates only, will
help improve margins and financial flexibility.
The ratings continue to be supported by CIE's dominant market
share position in the out-of-home entertainment sector within
Mexico as well as its profitable regional operations in Latin
America. The ratings are further supported by CIE's vertical
strategy, which gives the group an important edge to protect its
market position. It is also favorable to its ratings the value
of CIE's exceptional venues in Latin America, especially in
Mexico and Brazil. However, CIE's ratings are constrained by
the group's high leverage, tight short term liquidity and the
fact that its main growth driver, the gaming business, faces
competitive pressures not only from the well-established
Caliente but also from the starting gaming operations from
Televisa.
CIE's ratings could come under upward pressure if organic
revenues growth and lower operating costs allow for positive
free cash flow of above 10% of total debt while it maintains
EBITDA margin around 20%. On the other hand, CIE's Ba2/A2.mx
ratings could see downward pressure if EBITDA margin were to
fall below 17% and/or free cash flow is negative with no
prospects of short-term remedies.
CIE, based in Mexico City, is the largest "out of home"
entertainment company in Latin America.
FORD MOTOR: Fitch Downgrades Issuer Default Rating to B+ from BB
----------------------------------------------------------------
Fitch downgraded long-term ratings for both Ford Motor Company
and Ford Motor Credit Company with a Negative Rating Outlook,
and assigned these Recovery Ratings:
Ford:
-- Issuer Default Rating to 'B+' from 'BB'
-- Senior unsecured to 'BB-/RR3' from 'BB'
FMCC:
-- Issuer Default Rating to 'B+' from 'BB'
Fitch also affirms FMCC's senior unsecured debt at 'BB/RR2'.
Ford's newly assigned 'RR3' rating indicates average recovery
prospects of 50-70% in the event that further deterioration in
operating results eventually results in a filing for bankruptcy.
FMCC's new 'RR2' rating indicates superior recovery prospects of
70-90%.
The downgrade and Negative Outlook reflect Fitch's expectation
of persistent revenue deterioration through at least 2006 due
to:
* continued market share losses;
* deteriorating mix;
* price competition;
* a lack of key product introductions; and
* a lack of tangible progress in reducing its cost structure.
Despite an aggressive spending plan in 2006 to reduce its fixed
cost structure, persistently high commodity prices, and
financial and operational stresses at Ford's supply base are
likely to more than offset any progress in 2006, and Fitch
expects that Ford will see little relief in either cost category
over the near term. The unfavorable trend of revenues and key
cost factors is expected to result in accelerated negative cash
flows through 2006 and into 2007.
Ford will be challenged to reverse negative cash flows given a
relatively sparse product pipeline over the next several years.
Ford has taken a number of steps to address its fixed cost
structure through employee buyouts (at Ford and at the
reacquired Visteon assets), the recent health care agreement
with the UAW and certain plant closures, although cash savings
are likely to be insufficient to reverse negative cash flows
prior to the 2007 UAW contract re-opening.
Ford's latest restructuring program extends through the 2012,
with the bulk of facility closures not commencing until after
2007, limiting Ford's ability to achieve near-term cost
reductions. The success of the restructuring program will, to a
large degree, depend on the success of the OEM's ability to
negotiate further benefit reductions and operational flexibility
in the 2007 contract. Ford's U.S. supplier base remains fragile
throughout the supply chain, which could result in higher direct
costs, manufacturing inefficiencies or production interruptions
at Ford.
Although Ford has benefited from an improved passenger car
portfolio and the strong market position of its core F-Series
products, this has been insufficient to outpace the decline in
midsize and large SUV sales, including the Explorer, which have
historically been strong profit contributors. Ford also faces
intensifying competition in the large pickup market from a
refreshed GM lineup and the opening of a new Toyota plant later
this year.
Ford Credit, a strong provider of dividends over the past
several years, is expected to demonstrate significantly reduced
profitability and dividends going forward, resulting from:
* a smaller portfolio;
* a reduced benefit from lower loss accruals; and
* higher interest rates.
Fitch also recognizes that Ford has shown improvement and
profitability in its operations outside the United States,
including Europe, its Premium Automotive Group (P.A.G.), Latin
America, and in its Mazda holdings. Although Jaguar operations
remain a significant drain on P.A.G., the turnaround in the
consolidated group over the past several years has been a
positive to this point.
Ford's 'RR3' Recovery Rating is based on an analysis of a
potentially restructured Ford. Fitch's restructuring analysis
incorporates a Chapter 11 filing of North American operations
and would result in significant claims from working capital
liabilities (trade creditors, dealers, fleet customers, etc.) in
addition to unsecured debtholders. Fitch also factored in
liabilities related to on and off-balance sheet liabilities that
could augment claims. Fitch did not factor in claims related to
potential termination or alteration of legacy OPEB and pension
costs.
In the event of a filing, Fitch anticipates that Ford would not
attempt to terminate its pension plans. Changes to OPEB
liabilities, as with the recent agreement between Ford and the
UAW, would have to be negotiated as part of a new labor
agreement in the event of a Chapter 11 filing, without resulting
in claims against the estate. The restructured enterprise value
includes reduced production volumes and sufficient cost
reductions to achieve a 3% operating margin in North America,
plus asset values associated with international operations and
its 100% ownership of Ford Credit.
Liquidity remains adequate to finance restructuring requirements
and negative cash flows through the reopening of the UAW
contract. Cash and short-term VEBA at March 31, 2006, totaled
US$23.7 billion, supplemented by long-term VEBA (US$6.5 billion
at yearend 2005) that could be utilized to fund health care
expenditures over the near term. Over the past several years,
with the assistance of dividends from Ford Credit and the sale
of Hertz, Ford has been able to maintain a strong level of
liquidity, and has modestly reduced debt.
Debt maturities remain very extended. Legacy liabilities are
expected to decline in 2006 (although an accounting change will
bring certain liabilities back on the balance sheet) due to
Ford's recent health care agreement with the UAW and a re-
measurement of health care and pension liabilities due to higher
interest rates. However, potential pension legislation could
accelerate funding requirements.
FMCC's IDR remains linked to those of Ford due to the close
business relationship between them. Fitch expects FMCC's
earnings and dividends to decline noticeably in 2006 primarily
due to lower receivables outstanding and margins.
FMCC has benefited from lower provision expense, as the quality
of its receivables pool has increased, the pace of these
improvements is expected to slow going forward. Fitch believes
that FMCC maintains a good degree of liquidity relative to its
rating. Supporting this is FMCC's ability to sell or securitize
a broad spectrum of assets such as retail finance, lease, and
wholesale loans.
Moreover, FMCC continues to hold high cash balances and its
assets mature faster than its debt. The 'RR2' Recovery Rating
indicates superior recovery prospects on unsecured debt
resulting from solid unencumbered asset protection, although
discounted to account for stressed performance and/or
disposition.
Fitch downgraded these ratings with a Negative Rating Outlook:
Ford Motor Co.:
-- Issuer Default Rating to 'B+' from 'BB'
-- Senior debt to 'BB-/RR3' from 'BB'
Ford Motor Credit Co.:
-- Issuer Default Rating to 'B+' from 'BB'
FCE Bank Plc:
-- Issuer Default Rating to 'B+' from 'BB'
Ford Capital B.V.:
-- Issuer Default Rating to 'B+' from 'BB'
Ford Credit Canada Ltd.:
-- Issuer Default Rating to 'B+' from 'BB'
Ford Motor Capital Trust II:
-- Preferred stock to 'B-/RR6' from 'B+'
Ford Holdings, Inc.:
-- Issuer Default Rating to 'B+' from 'BB'
-- Senior debt to 'BB-/RR3' from 'BB'
Ford Motor Co. of Australia:
-- Issuer Default Rating to 'B+' from 'BB'
-- Senior debt to 'BB-/RR3' from 'BB'
Ford Credit Australia Ltd.:
-- Issuer Default Rating to 'B+' from 'BB'
PRIMUS Financial Services (Japan):
-- Issuer Default Rating to 'B+' from 'BB'
Ford Credit de Mexico, S.A. de C.V.:
-- Issuer Default Rating to 'B+' from 'BB'
Ford Motor Credit Co. of New Zealand:
-- Issuer Default Rating to 'B+' from 'BB'
Ford Credit Co S.A. de CV:
-- Issuer Default Rating to 'B+' from 'BB'
Fitch took these rating actions:
Ford Motor Co.:
-- Short-term Issuer Default Rating, rated 'B', is
withdrawn
Ford Motor Credit Co.:
-- Short-term Issuer Default Rating affirmed at 'B'
-- Commercial paper affirmed at 'B'
-- Senior debt affirmed at 'BB/RR2'
FCE Bank Plc:
-- Senior Unsecured affirmed at 'BB/RR2'.
-- Short-term Issuer Default Rating affirmed at 'B'
-- Commercial Paper affirmed at 'B'
-- Short-term Deposits affirmed at 'B'
Ford Capital B.V.:
-- Senior Unsecured affirmed at 'BB/RR2'
Ford Credit Canada:
-- Short-term Issuer Default Rating affirmed at 'B'
-- Commercial Paper affirmed at 'B'
-- Senior Unsecured affirmed at 'BB/RR2'
Ford Credit Australia Ltd.:
-- Senior Unsecured affirmed at 'BB/RR2'
-- Short-Term IDR affirmed at 'B'
-- Commercial Paper affirmed at 'B'
PRIMUS Financial Services (Japan):
-- Senior Unsecured affirmed at 'BB/RR2'
-- Short-term IDR affirmed at 'B'
Ford Motor Credit Co. of New Zealand:
-- Senior Unsecured affirmed at 'BB/RR2'
-- Short-Term IDR affirmed at 'B'
-- Commercial Paper affirmed at 'B'
Ford Credit Co. S.A. de C.V.:
-- Senior Unsecured affirmed at 'BB/RR2'
Fitch's Recovery Ratings, introduced in 2005, are a relative
indicator of creditor recovery on a given obligation in the
event of a default.
HSBC MEXICO: Moody's Revises D+ Rating's Outlook to Positive
------------------------------------------------------------
Moody's Investors Service changed to positive from stable the
outlook on HSBC Mexico's D+ bank financial strength rating. The
rating agency recognizes HSBC Mexico's established franchise,
good operating performance, and improved risk management
practices. Moody's also cited the steady progress on the bank's
recurring earning power as a positive factor.
HSBC Mexico continues to benefit from its robust deposit
franchise, a strength setting forth a competitive funding mix
and providing for the lowest funding cost among top banks.
Based on good brand recognition, HSBC Mexico has been able to
increase its market share in deposits, currently at levels of
14%.
Moody's added, however, that the bank is challenged to improve
the underlying asset quality of its loan portfolio in the
context of high loan growth, particularly in the consumer
segment. In effect, Moody's has noted some asset quality
deterioration in the form of a double-digit uptick in non-
performing consumer loans, reflecting portfolio growth and
increasing exposure to higher risk borrowers. Under this
scenario, the maintenance of credit underwriting in line with
conservative practices will be a key factor to reduce credit
costs to levels that are similar to those reported by higher-
rated peers.
HSBC Mexico's operating efficiency ratio, currently at a high
69%, continues to be another area for improvement despite the
significant progress observed in recent years.
HSBC Mexico, the fourth largest banking franchise in Mexico, had
total assets of around US$23.8 billion at March 2006.
This rating action was taken:
-- Bank Financial Strength Rating of D+: Outlook changed to
positive from stable.
J.L. FRENCH: Court Approves US$255MM Goldman & Morgan Exit Pact
---------------------------------------------------------------
J.L. French Automotive Castings, Inc., and its debtor-affiliates
obtained authority from the the U.S. Bankruptcy Court for the
District of Delaware to enter into a US$255 million exit
financing to be provided by Goldman Sachs Credit Partners, L.P.,
and Morgan Stanley Senior Funding, Inc.
As reported in the Troubled Company Reporter on May 24, 2006,
the Debtors told the Court that the exit lenders offered the
most favorable terms, including the lowest overall interest
rate. These terms, coupled with Goldman Sachs' familiarity with
the Debtors as second lien agent, formed the basis for the
Debtors' decision.
Exit Financing
The senior secured bank financing includes:
(a) US$150 million senior secured first lien term loan;
(b) US$55 million senior secured second lien term loan;
(c) US$50 million senior secured revolving credit facility.
The proceeds of the term facilities will be used to fund, in
part, the recapitalization contemplated by the Debtors' Second
Amended Plan. Amounts available under the revolving facility
will be used to provide for the Debtors' ongoing working capital
requirements. Goldman Sachs has agreed to provide:
-- 60% of the term facilities; and
-- 50% of the revolving facility.
Morgan Stanley has agreed to provide:
-- 40% of the term facilities; and
-- 50% of the revolving facility.
Fees to be paid to the exit lenders were not disclosed to the
public. The Debtors ask the Court for permission to file under
seal copies of the commitment letter and fee agreement.
Rating Agency Agreements
In connection with the exit financing, the Debtors entered
rating agency agreements with Moody's Investors Services and
Standard & Poor's Rating Agency. The Debtors will pay Moody's
US$50,000 for its services in rating the exit facility. S&P
will be paid US$52,500.
About J.L. French
Headquartered in Sheboygan, Wisconsin, J.L. French Automotive
Castings, Inc. -- http://www.jlfrench.com/-- is one of the
world's leading global suppliers of die cast aluminum components
and assemblies. There are currently nine manufacturing
locations around the world including plants in the United
States, United Kingdom, Spain, and Mexico. The company has
fourteen engineering/customer service offices to globally
support its customers near their regional engineering and
manufacturing locations. The Company and its debtor-affiliates
filed for chapter 11 protection on Feb. 10, 2006 (Bankr. D. Del.
Case No. 06-10119 to 06-06-10127). James E. O'Neill, Esq.,
Laura Davis Jones, Esq., and Sandra G.M. Selzer, Esq., at
Pachulski Stang Ziehl Young & Jones, and Marc Kiesolstein, P.C.,
at Kirkland & Ellis LLP, represent the Debtors in their
restructuring efforts. Ricardo Palacio, Esq., and William
Pierce Bowden, Esq., at Ashby & Geddes, PA, represents the
Official Committee Of Unsecured Creditors. When the Debtor
filed for chapter 11 protection, it estimated assets and debts
of more than US$100 million.
=====================
P U E R T O R I C O
=====================
DORAL FIN'L: Indenture Trustee Wants Report Filed by Dec. 31
------------------------------------------------------------
Doral Financial Corporation, a diversified financial services
holding company, received notice from U.S. Bank National
Association, the trustee for its US$625 million Floating Rate
Senior Notes due July 20, 2007, requiring Doral to file its
annual report on Form 10-K for the fiscal year ended
December 31, 2005 by August 31, 2006.
Under the indenture for the Notes, Doral must file with the
trustee copies of reports that it is required to file with the
SEC. If Doral fails to file its 2005 Form 10-K by
August 31, 2006, the trustee and the holders of at least 25% in
principal amount of the outstanding Notes will have the right to
accelerate the maturity of the Notes, by giving notice to the
Company in accordance with the terms of the indenture. The
Company expects to file its 2005 Form 10-K significantly before
August 31, 2006, and accordingly Doral does not expect that the
maturity of the Notes will be accelerated.
Doral discusses some of the risks and uncertainties relating to
an acceleration of the Notes, including its possible effects on
other debt issued under the indenture, in the Company's amended
annual report on Form 10-K for the fiscal year ended
December 31, 2004 and in its current report on Form 8-K filed
with the SEC on May 26, 2005, and refers readers to these
reports for further information.
About Doral Financial
Doral Financial Corporation -- http://www.doralfinancial.com/
-- a financial holding company, is the largest residential
mortgage lender in Puerto Rico, and the parent company of Doral
Bank, a Puerto Rico based commercial bank, Doral Securities, a
Puerto Rico based investment banking and institutional brokerage
firm, Doral Insurance Agency, Inc. and Doral Bank FSB, a federal
savings bank based in New York City.
* * *
As reported in the Troubled Company Reporter on March 27, 2006,
Moody's Investors Service downgraded to B1 from Ba3 the senior
debt ratings of Doral Financial Corporation, and reiterated the
negative rating outlook. Moody's action follows cease and
desist orders placed by banking regulators on Doral and some of
its subsidiaries, including Doral Bank, San Juan, Puerto
Rico. When Moody's last downgraded Doral's debt on
Oct. 28, 2005, it issued a negative rating outlook, but noted
that any credit deterioration including regulatory consequences
or liquidity issues could result in a review for possible
downgrade or an outright downgrade.
DORAL FINANCIAL: Fitch Maintains Ratings on Watch Negative
----------------------------------------------------------
Fitch maintains the Rating Watch Negative on Doral Financial
Corp. and subsidiaries ratings.
As a result of delayed filings, Doral has been in technical
default under their public bond indentures. On June 2, 2006,
Doral received notice of default from the trustee on its US$650
million indenture with a maturity of July 20, 2007. Doral has
90 days from June 2, 2006 to cure the default by filing their
year-end 2005 financial statement or acceleration of repayment
would occur. According to the company, this current default on
the public indenture does not cross-default with any other
funding facility but has cross-acceleration clause on US$200
million of debt in the event that there is an acceleration of
the public indenture. Management is working diligently in
finalizing financial statements. Fitch believes it is highly
likely that the restated financials will be filed before the
acceleration of debt would occur.
Doral recently completed a US$2.5 billion mortgage loan sale to
Deutsche Bank Securities Inc. Fitch views the sale positively
as it provides needed capital relief and improves leverage.
Fitch expects Doral to continue to improve capitalization as it
restructures its balance sheet.
Resolution of the Rating Watch Negative will be driven by
release of audited financial statements, satisfactory review of
the effects of the restatement on Doral's financial condition.
Additional filing delays into late July could result in a
downgrade of the company's ratings.
These ratings remain on Watch Negative:
Doral Financial Corporation
-- Long-term Issuer Default Rating: 'BB-';
-- Senior unsecured debt: 'BB-';
-- Short-term issuer: 'B';
-- Short term notes: 'B';
-- Preferred Stock: 'B'; and
-- Individual: 'D'.
Doral Bank
-- Long-term IDR: 'BB'
-- Long-term deposit obligations: 'BB+';
-- Short-term deposit obligations: 'B'; and
-- Individual: 'C/D';
DORAL FINANCIAL: S&P Lowers LT CounterParty Credit Rating to B+
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its long-term ratings
on Doral Financial Corp., including the company's long-term
counterparty rating, to 'B+' from 'BB-'. At the same time,
Doral's outlook remains on CreditWatch with negative
implications.
The rating actions follow Doral's announcement that it has
received a notice of default from its trustee. The default
notice requires Doral to file its 2005 10-K within 90 days. If
the 10-K is not filed by Aug. 31, 2006, and if the trustee and
the holders of at least 25% in principal amount of the US$625
million outstanding notes decide to accelerate payment, and file
a notice to such effect, Doral must pay in full. Furthermore,
Doral has cross-acceleration clauses on another US$251 million
of debt, which could be accelerated 30 days after any
acceleration of the US$625 million. In other words, if the
acceleration notice is exercised, the earliest the US$251
million of debt could be forced to be paid in full is Sept. 30,
2006. While management believes the 10-K will be filed well
within this time frame, the default notification heightens the
overall risk profile at Doral, as the accelerated debt repayment
would be extremely difficult for Doral to pay.
"The continuation of the CreditWatch listing reflects our
concerns over the default notification, which puts immense
pressure on the company to file its delinquent financial
statements," said Standard & Poor's credit analyst Michael
Driscoll. Other concerns include rising interest rates and
their effect on the mortgage origination market, funding costs,
and Doral's large MBS portfolio. Regulatory and legal issues
remain outstanding. Standard & Poor's expects to update the
CreditWatch once Doral files the 10-K. If the deadline
approaches without the 10-K being filed, the ratings could be
lowered again.
INTERLINE BRANDS: Maturity Yield of Sr. Notes Due 2014 Is 8.250%
----------------------------------------------------------------
Interline Brands, Inc. disclosed that its operating subsidiary,
Interline Brands, Inc., a New Jersey corporation, priced an
underwritten public offering of US$200.0 million aggregate
principal amount of its senior subordinated notes due 2014. The
notes will bear interest at an annual rate of 8.125% and were
priced at 99.283% of their principal amount, representing a
yield to maturity of 8.250%.
Interline New Jersey intends to use the proceeds of the
offering, along with borrowings under a proposed new credit
facility,
-- to finance its planned acquisition of American Sanitary,
-- to repay its indebtedness under its existing credit
facility,
-- to purchase its outstanding 11 1/2% Senior Subordinated
Notes due 2011 and
-- to pay fees and expenses.
The offering is expected to close on or about June 23, 2006.
Lehman Brothers Inc. and J.P. Morgan Securities Inc. are joint
bookrunning managers, Credit Suisse Securities (USA) LLC is lead
managing underwriter and Banc of America Securities LLC,
SunTrust Capital Markets, Inc. and Wachovia Capital Markets, LLC
are co-managing underwriters for the offering.
Full details of the offering, including a description of the
notes, are contained in a prospectus supplement and accompanying
prospectus, which can be obtained from
Lehman Brothers Inc.
Tel: (212)-526-7000
-- or --
J.P. Morgan Securities Inc.
Tel: (212)-270-3994.
The prospectus supplement and accompanying prospectus also will
be filed with the Securities and Exchange Commission and will be
available on the SEC's website at http://www.sec.gov.
About Interline
Headquartered in Jacksonville, Florida, Interline Brands, Inc.
-- http://www.interlinebrands.com/-- is a leading national
distributor and direct marketer of maintenance, repair and
operations products to approximately 160,000 professional
contractors, facilities maintenance professionals, and specialty
distributors across North America and Puerto Rico.
At March 31, 2006, Interline Brands, Inc.'s balance sheet showed
a stockholders' deficit of US$159,234,000, compared to a
US$152,878,000 deficit at Dec. 30, 2005.
INTERLINE BRANDS: S&P Affirms BB- Corporate Credit Rating
---------------------------------------------------------
Standard & Poor's Rating Services affirmed its 'BB-' corporate
credit rating on Jacksonville, Fla.-based Interline Brands Inc.
At the same time, Standard & Poor's assigned its 'BB' bank loan
rating and '1' recovery rating to Interline's proposed US$100
million revolving credit facility due 2012 and US$255 million
term loan B due 2013, based on preliminary terms and conditions.
The debt rating and recovery rating indicate expectations for
full recovery of principal in the event of a payment default.
Standard & Poor's also assigned its 'B' subordinated debt rating
to Interline's US$175 million fixed-rate subordinated notes due
2016. The outlook is stable.
The proceeds from the US$255 million term loan B, which includes
a US$130 million delayed-draw portion, and the US$175 million of
subordinated notes will be used to refinance Interline's
existing term loan and subordinated notes and acquire unrated
American Sanitary Inc., a national distributor of janitorial and
sanitary supplies, for US$128 million. Although the addition of
American Sanitary expands Interline's product line, the
acquisition does not meaningfully improve Interline's business
position.
"We could revise the outlook to negative if Interline pursues a
more aggressive acquisition strategy than expected," said
Standard & Poor's credit analyst Lisa Wright. "We are unlikely
to raise the ratings over the near term, given Interline's
relatively small size compared to some of its competitors and
given its growth strategy, which could include additional debt-
financed acquisitions."
INTERLINE BRANDS: 11-1/2 Senior Notes Will Yield 5.629%
-------------------------------------------------------
Interline Brands, Inc. disclosed that its operating subsidiary,
Interline Brands, Inc., a New Jersey corporation determined the
tender offer yield for its outstanding tender offer and related
consent solicitation for any and all of its outstanding 11-1/2%
Senior Subordinated Notes Due 2011 (CUSIP No. 458743 AB 7). The
tender offer yield for the Notes tendered and accepted will be
5.629% and was determined by reference to a fixed spread of
0.50% over the yield to maturity of the 4.375% U.S. Treasury
Note due May 15, 2007.
Assuming an early settlement date of June 23, 2006, the "Total
Consideration" for each US$1,000 principal amount of Notes
validly tendered and not validly withdrawn at or prior to 5:00
p.m., Eastern Time, on June 7, 2006, the "Consent Date", is
US$1,105.10, which includes a consent payment of US$30 per
US$1,000 principal amount of Notes. Holders whose Notes are
validly tendered after the Consent Date, but at or prior to 5:00
p.m., Eastern Time, on June 23, 2006, the "Expiration Date" for
the tender offer, will be eligible to receive the "Tender Offer
Consideration" of US$1,075.10 per US$1,000 principal amount of
Notes tendered, but will not be eligible to receive the US$30
per US$1,000 principal amount consent payment. In addition,
accrued but unpaid interest up to, but not including, the
applicable settlement date will be paid on all Notes validly
tendered and accepted for purchase. As set forth in detail in
the Offer to Purchase and Consent Solicitation Statement, dated
May 23, 2006, the tender offer is subject to the satisfaction of
certain conditions, including the successful receipt of net
proceeds of the financing transactions sufficient to finance the
tender offer and consent solicitation on terms satisfactory to
Interline New Jersey. A copy of the Offer to Purchase is
available from the Information Agent:
D.F. King,
Tel: (800) 290-6426 (toll free)
(212) 269-5550 (collect).
About Interline
Headquartered in Jacksonville, Florida, Interline Brands, Inc.
-- http://www.interlinebrands.com/-- is a leading national
distributor and direct marketer of maintenance, repair and
operations products to approximately 160,000 professional
contractors, facilities maintenance professionals, and specialty
distributors across North America and Puerto Rico.
At March 31, 2006, Interline Brands, Inc.'s balance sheet showed
a stockholders' deficit of US$159,234,000, compared to a
US$152,878,000 deficit at Dec. 30, 2005.
MAXXAM INC: March 31 Balance Sheet Upside-Down by US$671.3 Mil.
---------------------------------------------------------------
Maxxam Inc. filed its financial report for the quarter ended
March 31, 2006, to the Securities and Exchange Commission.
Maxxam's balance sheet at March 31, 2006, showed a US$671.3
million total stockholders' deficit resulting from US$1,013.1
million in total assets and US$1,684.4 million in total
liabilities.
The Company's balance sheet also showed total current assets of
US$284.6 million and total current liabilities of US$200.2
million.
For the three months ended March 31, 2006, the Company incurred
a net loss of US$10.2 million from net sales of US$80.2 million.
A full-text copy of Maxxam's quarterly report is available for
free at http://researcharchives.com/t/s?b23
Headquartered in Houston, Texas, MAXXAM Inc. (AMEX: MXM)
operates businesses ranging from aluminum and timber products to
real estate and horse racing. MAXXAM's top revenue source is
Kaiser Aluminum, which has been in Chapter 11 bankruptcy since
2002. MAXXAM's timber subsidiary, Pacific Lumber, owns about
205,000 acres of old-growth redwood and Douglas fir timberlands
in Humboldt County, California. MAXXAM's real estate interests
include commercial and residential properties in Arizona,
California, Texas, and Puerto Rico. The Company also owns the
Sam Houston Race Park, a horseracing track near Houston.
Chairman and CEO Charles Hurwitz controls 77% of MAXXAM.
=================
V E N E Z U E L A
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ARVINMERITOR INC: S&P Puts BB+ Rating on US$1.05 Bil. Bank Debt
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB+' bank loan
and recovery ratings of '1' to ArvinMeritor Inc.'s $1.05 billion
bank senior secured debt, indicating the expectation for full
recovery of principal in the event of a payment default.
Standard & Poor's will withdraw the rating on ArvinMeritor's
existing unsecured bank facility upon completion of the proposed
transaction.
At the same time, Standard & Poor's lowered its senior unsecured
debt ratings on ARM to 'BB-' from 'BB' and removed them from
CreditWatch where they were placed with negative implications on
May 22. The downgrade stems from the contractual subordination
resulting from the pending transaction to replace the unsecured
bank facility with the new senior secured credit facilities.
In addition, ArvinMeritor's 'B-1' short-term corporate credit
rating was affirmed and removed from CreditWatch. The new
secured facility provides the company with approximately the
same-size bank facility, but with less restrictive covenants and
a longer maturity than the existing bank facility.
The 'BB' long-term corporate credit rating on the Troy,
Michigan-based auto supplier was not on CreditWatch, and was
affirmed. The outlook is negative.
***********
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 - Latin America is a daily newsletter
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Copyright 2006. All rights reserved. ISSN 1529-2746.
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