/raid1/www/Hosts/bankrupt/TCRLA_Public/070306.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, March 6, 2007, Vol. 8, Issue 46
Headlines
A R G E N T I N A
ALPARGATAS: Board Denies Part in Company Sale or Merger Talks
BANCO DE GALICIA: Repays ARS908.7 Mil. Remaining Debt Balance
BEST QUALITY: Trustee Verifies Proofs of Claim Until May 3
CENTRO DE LA CONSTRUCCION: Claims Verification Is Until May 7
FERRO CORP: Declares Record Sales of US$2.04 Billion for 2006
FIESTAS Y EVENTOS: Claims Verification Is Until April 25
FOG SRL: Trustee Will Verify Proofs of Claim Until March 20
LA PARMESANA: Trustee Will Verify Proofs of Claim Until April 3
MAITEN CONSTRUCCIONES: Claims Verification Is Until April 18
MEDICINA PARA: Claims Verification Is Until April 3
MIGUEL ANGEL: Trustee Will Verify Proofs of Claim Until May 10
MORGAN SA: Evaluadora Rates US$458.25-Million Notes at D
NICOL SA: Asks Court for Reorganization Approval
PROVINCIA LEASING: Evaluadora Rates ARS32-Million Certs. at D
TRANSPORTE CHARACANI: Claims Verification Is Until April 30
B A R B A D O S
HILTON HOTELS: Sells Scandic Hotel Chain for US$1.1 Billion
B E R M U D A
SCOTTISH RE: Shareholders Okay MassMutal Capital & Cerberus Deal
SCOTTISH RE: S&P Holds Ratings Watch on MassMutual/Cerberus Deal
B O L I V I A
* BOLIVIA: Inks US$2.1-Bil. Plant Construction Pact with Jindal
B R A Z I L
BANCO NACIONAL: Approves BRL39.7-Million Financing to Itajai
BRASIL TELECOM: Orascom Offers to Buy Telecom Italia's Stake
COMPANHIA ENERGETICA: Board Plans for Bonus & Dividend Payments
ITRON INC: Completes Private Placement of 4,086,958 Shares
NRG ENERGY: 2006 Net Income Increases to US$621 Million
PETROLEO BRASILEIRO: Awards US$150MM Pipe Contract to Technip
PETROLEO BRASILEIRO: Finds Reserves in Caxareu Field
TELE NORTE: Will Use Oi Brand in All Its Services
C A Y M A N I S L A N D S
BIMINI SHIPPING: Proofs of Claim Filing Ends on March 20
DREWCAT CAPITAL: Proofs of Claim Filing Ends on March 21
DREWCAT CAPITAL: Sets Last Shareholders Meeting for March 21
DYNAMIC CAYMAN: Final Shareholders Meeting Is on March 20
EQUITY HAA: Final Shareholders Meeting Is on March 20
GFN CORP: Court to Hear Wind Up Petition on March 16
HILDING EQUITY: Final Shareholders Meeting Is on March 20
HILDING IIP: Final Shareholders Meeting Is on March 20
HILDING (SEDCO): Final Shareholders Meeting Is on March 20
INVESTCORP HILDING INVESTING: Shareholders Meeting Is March 20
INVESTCORP HILDING ISLAMIC: Shareholders Meeting Is on March 20
INVESTCORP PRINCIPAL: Final Shareholder Meeting Is on March 13
INVESTCORP HILDING (SEDCO): Shareholders Meeting Is on March 20
KOWLOON LTD: Proofs of Claim Filing Ends on March 20
LANDMARK FUNDING: Final Shareholders Meeting Is on March 20
MASK HOLDINGS: Final Shareholders Meeting Is on March 20
VOORBURG INVESTMENTS: Proofs of Claim Filing Ends on March 21
C H I L E
CONSTELLATION BRANDS: Buyback Prompts Fitch to Lower Ratings
ITRON INC: Ambassador Thomas S. Foley Retires as Director
LEVI STRAUSS: Nov. 26 Balance Sheet Upside-Down by US$1 Billion
PAMPA CALICHERA: S&P Says Ratings Reflect High Leverage
C O L O M B I A
ARMOR HOLDINGS: Wins US$50.3MM Deal to Produce Armored FMTV Cabs
DEL MONTE: Earns US$45.5 Million in Quarter Ended January 28
ECOPETROL: Pre-qualifies Contractors for Oil Well Construction
* COLOMBIA: Auctioning Acerias Paz's 52% Stake on March 16
C O S T A R I C A
GENERAL NUTRITION: Launches US$365 Million Cash Tender Offering
* COSTA RICA: May Have to Review Treaty Process Amendment
D O M I N I C A N R E P U B L I C
BANCO INTERCONTINENTAL: Audit on Bank Reveals Incomplete Probe
FLOWSERVE CORP: Board Resumes Quarterly Cash Dividend Payments
FLOWSERVE CORP: Reports Record Annual Sales of US$3.1 Billion
JETBLUE AIRWAYS: Launches Nonstop Service in Dominican Republic
E L S A L V A D O R
ALCATEL-LUCENT: Inks Network Deal with Advocate Health Care
ALCATEL-LUCENT: Inks Network Outsourcing Deal with E-Plus
* EL SALVADOR: Economy Improves Due to Free Trade
J A M A I C A
AIR JAMAICA: To Make Deal with Other Carriers for U.S. Entry
GOODYEAR TIRE: Revises U.S. Pension, Retiree Benefit Plans
* JAMAICA: Secures US$9-Million Credit Commitment from India
M E X I C O
CHEMTURA CORP: Posts US$144.3MM Net Loss in 2006 Fourth Quarter
CLEAR CHANNEL: Urges Shareholders to Vote for Proposed Merger
DELTA AIR: Comair Pilots Approve Contract
FORD MOTOR: Will Sell APCO Assets to Trident IV
GENERAL MOTORS: Reports Increase in U.S. Sales for February
LEVI STRAUSS: S&P Assigns B Rating on Proposed US$325-Mil. Loan
NORTEL NETWORKS: Restating Financials Due to Calculation Errors
VALASSIS COMM: Completes ADVO Acquisition for US$1.2 Billion
P A N A M A
AES CORP: Delays Filing of 2006 Annual Report
GRUPO BANISTMO: HSBC Seeks Regulator's Permission to Absorb Firm
P E R U
GRAN TIERRA: Secures US$50-Million Financing with Standard Bank
P U E R T O R I C O
AFC ENTERPRISES: Kenneth Keymer Steps Down as Chief Executive
ALLIED WASTE: Tim Donovan Replaces Steven Helm as Gen'l Counsel
DORAL FINANCIAL: Pays Cash Dividend on Four Series of Stock
FIRST BANCORP: Board Declares Preferred Dividends Payment
HERTZ CORP: Plans Additional 1,350 Job Cuts, Mostly in the U.S.
V E N E Z U E L A
DAIMLERCHRYSLER AG: Chrysler Eyes Sale of Dodge Cars in China
ELECTRICIDAD DE CARACAS: AES Inks Definitive Pact for Stake Sale
PETROLEOS DE VENEZUELA: AES Inks Definitive Pact for Stake Sale
* VENEZUELA: Expects Demand for South Bonds to Reach US$12 Bil.
* VENEZUELA: Ministry Denies Shortage of Industrial Supplies
* VENEZUELA: Resumption of Alunasa's Operations Temporary
* BOND PRICING: For the Week February 26 to March 2, 2007
- - - - -
=================
A R G E N T I N A
=================
ALPARGATAS: Board Denies Part in Company Sale or Merger Talks
-------------------------------------------------------------
The Board of Directors of Alpargatas said in a filing with the
Comision Nacional de Valores that it "does not take part" in
negotiations related to the possible sale or merger of the
company.
The company also indicated that "it is not possible to say if a
shareholder in particular or any other shareholder could be
considering at this moment the sale or acquisition of shares" of
the textile company.
Regarding Camargo Correa, the Board of Alpargatas said that this
company does not appear among the creditors verified in the
"concurso preventivo."
In another letter addressed to the Buenos Aires Stock Exchange,
the management of the textile company had affirmed it's not
aware of any negotiation for a possible sale, which made the
company's shares price to rise by 9.8%.
Alpargatas S.A.I.C. is an Argentine producer of sport shoes
(through Alpargatas Calzados) and clothes (through Alpargatas
Textil).
As reported on Jan. 17, 2007, Fitch Argentina Calificadora de
Riesgo assigned D ratings on Alpargatas' Obligaciones
Negociables for:
-- US$70 million (US$6.2 million in circulation),
-- US$40.898 million in circulation,
-- US$80 million (US$5.9 million in circulation),
-- US$40 million (US$13.4 million in circulation),
-- US$1.1 million (Class A) and US$80 millions (Class B).
BANCO DE GALICIA: Repays ARS908.7 Mil. Remaining Debt Balance
-------------------------------------------------------------
Banco Galicia would pay this month its remaining ARS908.7
million debt to the Banco Central de Argentina, as part of a
plan to complete the restructuring of its debts.
Banco Galicia's debts stemmed from emergency loans made by the
central bank during the country's 2001-2002 economic crisis.
The bank paid off most of its debts last year.
The bank has also requested the release of the public-sector
assets granted as collateral for said financial assistance
(various series of Prestamos Garantizados) for an aggregate face
value amount of ARS1,024.9 million.
Moreover, the bank has requested to the Central Bank the
subscription in cash of the remaining balance of the Hedge
Bond, BODEN 2012 government bonds, for US$116.8 million of
face value. This constitutes the remaining balance of the
compensation payable to the Bank established by the decree
number 905/02, for the net short position in foreign
currency as of Dec. 31, 2001, generated by the Argentine
government's 2002 asymmetric pesofication rules.
In addition, due to the subscription in cash of the Hedge Bond,
ARS163.5 million of face value of Bogar government bonds
allocated as guaranties will be released. In accordance with
Central Bank's valuation rules (Communique "A" 3911 and
complementary regulations), this will cause a reduction in such
Bogar government bonds' book value of approximately ARS30
million.
Once these transactions are completed, the Bank will have paid
all of its debt with the Central Bank for financial assistance.
In addition, the process of compensation to the Bank for the net
short foreign currency position generated by the pacification of
assets and liabilities in 2002 will be completed.
Headquartered in Buenos Aires, Argentina, Banco de Galicia y
Buenos Aires SA -- http://www.e-galicia.com/-- is an
Argentinean private bank that is engaged in commercial banking,
providing general banking services to large corporations, small
and medium-sized companies, agricultural and cattle farms and
individuals. The company controls an extensive and diverse
network of subsidiaries, which include Banco Galicia Uruguay SA,
Galicia Capital Markets SA, Galicia Factoring y Leasing SA, Agro
Galicia SA, Galicia Administradora de Fondos SA, Galicia Valores
SA, Galicia Warrants SA, Net Investments SA, Sudamericana
Holding SA and Tarjetas Regionales SA. Through its subsidiaries
the company offers accounting, investment and insurance
services, loans, checks and debit and credit cards. It also
finances the development of real estate, acts as a fiduciary and
leases properties to interested parties. It operates over 400
branches across the country and provides e-banking services to
customers via its Internet site.
* * *
As reported in the Troubled Company Reporter-Latin America on
Feb. 23, 2007, Banco de Galicia y Buenos Aires' Obligaciones
Negociables issued on Nov. 6, 2001, for the original amount of
US$12 millon was rated D by the Argentine arm of Standard &
Poor's International Ratings.
BEST QUALITY: Trustee Verifies Proofs of Claim Until May 3
----------------------------------------------------------
Rodolfo Fernando Daniel Torella, the court-appointed trustee for
Best Quality S.A.'s bankruptcy proceeding, verifies creditors'
proofs of claim until May 3, 2007.
Mr. Torella will present the validated claims in court as
individual reports on June 15, 2007. Court No. 14 in Buenos
Aires' Civil and Commercial Tribunal will determine if the
verified claims are admissible, taking into account the
trustee's opinion, and the objections and challenges raised by
Best Quality and its creditors.
Inadmissible claims may be subject for appeal in a separate
proceeding known as an appeal for reversal.
A general report that contains an audit of Best Quality's
accounting and banking records will be submitted in court on
Aug. 13, 2007.
Mr. Torella is also in charge of administering Best Quality's
assets under court supervision and will take part in their
disposal to the extent established by law.
The trustee can be reached at:
Rodolfo Fernando Daniel Torella
Arcos 3726
Buenos Aires, Argentina
CENTRO DE LA CONSTRUCCION: Claims Verification Is Until May 7
-------------------------------------------------------------
Julio Cesar Capovilla, the court-appointed trustee for Centro de
la Construccion SA's bankruptcy proceeding, will verify
creditors' proofs of claim until May 7, 2007.
Under the Argentine bankruptcy law, Mr. Capovilla is required to
present the validated claims in court as individual reports.
Court No. 5 in Buenos Aires' Civil and Commercial Tribunal will
determine if the verified claims are admissible, taking into
account the trustee's opinion, and the objections and challenges
raised by Centro de la Construccion and its creditors.
Inadmissible claims may be subject for appeal in a separate
proceeding known as an appeal for reversal.
Mr. Capovilla will also submit a general report that contains an
audit of Centro de la Construccion's accounting and banking
records. The report submission dates have not been disclosed.
Centro de la Construccion was forced into bankruptcy at the
behest of BBVA Banco Frances SA, whom it owes US$148,097.15.
Clerk No. 9 assists the court in the proceeding.
The debtor can be reached at:
Centro de la Construccion SA
Viamonte 1660
Buenos Aires, Argentina
The trustee can be reached at:
Julio Cesar Capovilla
Avenida Corrientes 3859
Buenos Aires, Argentina
FERRO CORP: Declares Record Sales of US$2.04 Billion for 2006
-------------------------------------------------------------
Ferro Corp. announced that sales for the year ended
Dec. 31, 2006, were a record US$2.04 billion, up 8.5 percent
from 2005. Sales for the fourth quarter were US$497 million, an
increase of 8.6 percent from the fourth quarter of 2005.
Income from continuing operations for 2006 was US$20.6 million,
compared with US$17.1 million in 2005. In 2006, operating
income included net pre-tax expenses of US$34.9 million
primarily related to previously announced manufacturing
rationalization activities and costs associated with an
accounting investigation and restatement. In 2005, operating
income was reduced by pre-tax expenses of US$14.1 million,
primarily related to expenses from restructuring and the
accounting investigation and restatement.
"We delivered substantial growth in sales, and a strong 29
percent increase in our total segment income in 2006," said
Chairman, President and Chief Executive Officer James Kirsch.
"We have initiated important restructuring programs that will
provide significant future cost savings. And with a new senior
team in place, we are committed to delivering sustained global
growth and improved profitability in 2007 and beyond."
2006 Full-Year Results
Sales growth in 2006 was a result of strong performances in
Ferro's Electronic Materials, Performance Coatings, and Color
and Glass Performance Materials segments. Sales in the Polymer
Additives and Specialty Plastics segments were negatively
impacted by weakness in the U.S. residential construction and
automotive markets in the second half of the year.
Increased prices, including higher precious metal prices, and
improved product mix across all of the Company's businesses,
were the primary drivers of sales growth for 2006. Overall
volume declined slightly as volume improvements in Electronic
Materials and Performance Coatings were offset by declines in
Specialty Plastics and Polymer Additives.
Gross margins were 20.3 percent of sales for the year, compared
with 20.4 percent of sales in 2005. The Company's 2006 gross
profit was reduced by US$4.6 million of costs related to
manufacturing rationalization activities. Gross margins were
also negatively impacted by increased precious metal sales,
compared to 2005. Precious metals costs are largely passed
through to customers with minimal margin contribution.
Selling, general and administrative or SG&A expense was US$305.2
million in 2006, or 15.0 percent of sales. Included in the 2006
SG&A expense were US$8.2 million in charges, primarily related
to the accounting investigation and restatement. SG&A expense
in 2005 was US$310.1 million, or 16.5 percent of sales,
including charges of US$10.5 million related to the accounting
investigation and restatement.
Total segment income for 2006 was US$151.8 million, up 29
percent from the prior-year level of US$118.0 million. The
increase reflected higher income from all segments except
Polymer Additives.
Interest expense increased in 2006, reflecting higher borrowing
levels and higher interest rates on funds borrowed. Interest
expense for 2006 was US$64.4 million, compared with US$46.9
million in 2005. The 2006 interest expense included a US$2.5
million write-down of previously unamortized fees and discounts
associated with the company's prior credit facility and
debentures that were accelerated. The interest rate on the
company's term loans and revolving credit borrowings declined by
50 basis points as a result of becoming current on its financial
filings in December 2006.
During 2006, the Company's effective tax rate declined to 19.6
percent from 28.8 percent in 2005, largely as a result of a
lower valuation reserve against certain deferred tax assets and
reduced tax rates in certain foreign jurisdictions. These
benefits were partially offset by a higher reserve for possible
future U.S. taxes on accumulated foreign earnings that may be
repatriated to the U.S. The company expects its effective tax
rate in 2007 will be approximately 33 percent.
Total debt at the end of 2006 was US$592.4 million, an increase
of US$38.7 million from the end of 2005. In addition, the
Company had US$60.6 million in its accounts receivable
securitization program as of Dec. 31, 2006, compared with US$1.0
million at the end of 2005. An increase in working capital,
including deposit requirements related to the company's precious
metal consignments, was a primary driver of the higher
borrowing. These deposit requirements were US$70.1 million at
the end of 2006, an increase from US$19.0 million at the end of
2005. The year-end deposits were down US$23.2 million from
Sept. 30, 2006, and the company expects to further reduce these
deposits in the first half of 2007.
2006 Fourth-Quarter Results
Sales of US$497.3 million for the fourth quarter were led by
year-over-year growth in Performance Coatings, Electronic
Materials, and Color and Glass Performance Materials. Sales in
Polymer Additives and Specialty Plastics were lower due to
slowing in the U.S. residential construction and automotive
markets.
The fourth-quarter revenue increase of 8.6 percent was primarily
due to increases in prices, including higher precious metal
prices, improved product mix and favorable foreign exchange
rates, compared with the fourth quarter of 2005. Favorable
foreign currency exchange rates added less than 4 percentage
points to the revenue growth rate. Lower volumes reduced sales
growth by less than 2 percentage points.
Gross margin for the fourth quarter was 19.6 percent of sales,
unchanged from the fourth quarter of 2005. Gross profit was
reduced by US$3.0 million during the 2006 fourth quarter, as a
result of costs related to the company's manufacturing
rationalization. Higher precious metal prices, which are
generally passed through to customers with minimal mark-up, also
had a negative impact on gross margin percentage for the quarter
compared with the prior-year period.
Selling, general and administrative expense for the fourth
quarter was US$73.3 million, or 14.7 percent of sales. Included
in quarterly SG&A expense were US$1.6 million in charges,
primarily related to divestment activities and severance. SG&A
expense was US$75.7 million, or 16.5 percent of sales, in the
fourth quarter of 2005. Charges of US$1.7 million, related to
the accounting investigation and restatement, were included in
fourth quarter 2005 SG&A expense.
Total segment income for the fourth quarter was US$33.0 million,
a 40-percent increase over the fourth quarter of 2005.
During the fourth quarter, net income was reduced as a result of
net pre-tax charges of US$23.1 million, primarily related to
manufacturing rationalization activities in the company's
European Inorganics business and the Electronic Materials
business in the United States. Partially offsetting these
charges was a benefit related to a litigation settlement.
2007 First-Quarter Guidance
Sales for the first quarter of 2007 are expected to be
approximately US$500 million to US$525 million, reflecting
continued growth across multiple business segments. Sequential
growth over fourth-quarter 2006 sales is expected to be broadly
based across the company's businesses.
The Company expects higher interest expense and smaller losses
from forward supply contracts in the 2007 first quarter,
compared with the prior-year period. Earnings for the first
quarter are expected to be between US$0.17 and US$0.22 per
share. This estimate includes expected charges of approximately
5 cents per share, primarily from ongoing manufacturing
rationalization activities. The company reported income from
continuing operations of US$0.19 per share in the first quarter
of 2006.
Headquartered in Cleveland, Ohio, Ferro Corp. (NYSE:FOE) --
http://www.ferro.com/-- supplies technology-based performance
materials for manufacturers. Ferro materials enhance the
performance of products in a variety of end markets, including
electronics, telecommunications, pharmaceuticals, building and
renovation, appliances, automotive, household furnishings, and
industrial products. The company has approximately 6,800
employees globally. In Latin America, the company has
operations in Argentina, Brazil, Mexico and Venezuela.
* * *
As reported in the Troubled Company Reporter-Latin America on
March 2, 2007, Standard & Poor's Ratings Services affirmed its
'B+' corporate credit rating on Ferro Corp. and raised the
senior debt rating to 'B+' from 'B'. The ratings are removed
from CreditWatch, where they were placed Nov. 18, 2005, with
negative implications. S&P said the outlook is stable.
FIESTAS Y EVENTOS: Claims Verification Is Until April 25
--------------------------------------------------------
Court No. 19 of Buenos Aires' Civil and Commercial Tribunal
approved a petition for reorganization filed by Fiestas y
Eventos SA, according to a report from Argentine daily La
Nacion. The Company has US$254,417.07 in liabilities.
Trustee Ana Maria Pazos will verify claims from the Fiestas y
Eventos SA's creditors until July 17, 2007. After verification,
the trustee will submit the individual and general reports in
court. Dates for submission of these reports are yet to be
disclosed.
The informative assembly will be held on March 5, 2008.
Creditors will vote to ratify the completed settlement plan
during the said assembly.
The city's Clerk No. 38 assists the court on the case.
The debtor can be reached at:
Fiestas y Eventos SA
Talcahuano 446
Buenos Aires, Argentina
The trustee can be reached at:
Ana Maria Pazos
Montiel 1147, Planta Baja
Buenos Aires, Argentina
FOG SRL: Trustee Will Verify Proofs of Claim Until March 20
-----------------------------------------------------------
Clara Averhan, the court-appointed trustee for Fog SRL's
bankruptcy proceeding, will verify creditors' proofs of claim
until March 20, 2007.
Under the Argentine bankruptcy law, Ms. Averhan is required to
present the validated claims in court as individual reports.
Court No. 6 in Buenos Aires' Civil and Commercial Tribunal will
determine if the verified claims are admissible, taking into
account the trustee's opinion, and the objections and challenges
raised by Fog SRL and its creditors.
Inadmissible claims may be subject for appeal in a separate
proceeding known as an appeal for reversal.
Ms. Averhan will also submit a general report that contains an
audit of Fog SRL's accounting and banking records. The report
submission dates have not been disclosed.
Fog SRL was forced into bankruptcy at the behest of Gloria
Gigena, whom it owes US$93,617.55.
Clerk No. 12 assists the court in the proceeding.
The debtor can be reached at:
Fog SRL
Avenida Honorio Pueyrredon 750
Buenos Aires, Argentina
The trustee can be reached at:
Clara Averhan
Uruguay 872
Buenos Aires, Argentina
LA PARMESANA: Trustee Will Verify Proofs of Claim Until April 3
---------------------------------------------------------------
Aldo Bassagaisteguy, the court-appointed trustee for La
Parmesana SA's bankruptcy proceeding, will verify creditors'
proofs of claim until April 3, 2007.
Under the Argentine bankruptcy law, Mr. Bassagaisteguy is
required to present the validated claims in court as individual
reports. Court No. 18 in Buenos Aires' Civil and Commercial
Tribunal will determine if the verified claims are admissible,
taking into account the trustee's opinion, and the objections
and challenges raised by La Parmesana and its creditors.
Inadmissible claims may be subject for appeal in a separate
proceeding known as an appeal for reversal.
Mr. Bassagaisteguy will also submit a general report that
contains an audit of La Parmesana SA's accounting and banking
records. The report submission dates have not been disclosed.
La Parmesana was forced into bankruptcy at the behest of Search
Organizacion de Seguridad, which it owes US$17,727.05.
Clerk No. 36 assists the court in the proceeding.
The debtor can be reached at:
La Parmesana SA
Zuviria 863
Buenos Aires, Argentina
The trustee can be reached at:
Aldo Bassagaisteguy
Ecuador 1185
Buenos Aires, Argentina
MAITEN CONSTRUCCIONES: Claims Verification Is Until April 18
------------------------------------------------------------
Jose Maria Colace, the court-appointed trustee for Maiten
Construcciones S.R.L.'s bankruptcy proceeding, verifies
creditors' proofs of claim until April 18, 2007.
Mr. Colace will present the validated claims in court as
individual reports on June 1, 2007. Court No. 10 in Buenos
Aires' Civil and Commercial Tribunal will determine if the
verified claims are admissible, taking into account the
trustee's opinion, and the objections and challenges raised by
Maiten Construcciones and its creditors.
Inadmissible claims may be subject for appeal in a separate
proceeding known as an appeal for reversal.
A general report that contains an audit of Maiten
Construcciones's accounting and banking records will be
submitted in court on July 17, 2007.
Mr. Colace is also in charge of administering Maiten
Construcciones's assets under court supervision and will take
part in their disposal to the extent established by law.
The trustee can be reached at:
Jose Maria Colace
Bernardo de Irigoyen 330
Buenos Aires, Argentina
MEDICINA PARA: Claims Verification Is Until April 3
---------------------------------------------------
Elena B. Tancredo, the court-appointed trustee for Medicina para
la Comunidad SRL's bankruptcy proceeding, will verify creditors'
proofs of claim until April 3, 2007.
Under the Argentine bankruptcy law, Ms. Tancredo is required to
present the validated claims in court as individual reports.
Court No. 6 in Buenos Aires' Civil and Commercial Tribunal will
determine if the verified claims are admissible, taking into
account the trustee's opinion, and the objections and challenges
raised by Medicina para la Comunidad and its creditors.
Inadmissible claims may be subject for appeal in a separate
proceeding known as an appeal for reversal.
Ms. Tancredo will also submit a general report that contains an
audit of Medicina para la Comunidad's accounting and banking
records. The report submission dates have not been disclosed.
Medicina para la Comunidad was forced into bankruptcy at the
behest of Celso SRL, which it owes US$26,824.42.
Clerk No. 12 assists the court in the proceeding.
The debtor can be reached at:
Medicina para la Comunidad SRL
Sanchez de Loria 553
Buenos Aires, Argentina
The trustee can be reached at:
Elena B. Tancredo
Ecuador 1185
Buenos Aires, Argentina
MIGUEL ANGEL: Trustee Will Verify Proofs of Claim Until May 10
--------------------------------------------------------------
Court No. 15 of Buenos Aires' Civil and Commercial Tribunal
approved a petition for reorganization filed by Miguel Angel
Daddiego SA, according to a report from Argentine daily La
Nacion. The Company has US$926,933.75 in assets and
US$1,656,510.97 in liabilities.
Trustee Carlos Carrescia will verify claims from the Miguel
Angel's creditors until May 10, 2007. After verification
period, the trustee will submit the individual and general
reports in court. Dates for submission of these reports are yet
to be disclosed.
The informative assembly will be held on Feb. 29, 2008.
Creditors will vote to ratify the completed settlement plan
during the said assembly.
The city's Clerk No. 29 assists the court on the case.
The debtor can be reached at:
Miguel Angel Daddiego SA
Esmeralda 740
Buenos Aires, Argentina
The trustee can be reached at:
Carlos Carrescia
Tucuman 1621
Buenos Aires, Argentina
MORGAN SA: Evaluadora Rates US$458.25-Million Notes at D
--------------------------------------------------------
Evaluadora Latinoamericana S.A. Calificadora de Riesgo rated
Morgan S.A.'s obligaciones negociables for US$458.25 million,
due April 1, 2011, D. The rating action was based on the
company's financial status at Sept. 30, 2006.
NICOL SA: Asks Court for Reorganization Approval
------------------------------------------------
Nicol SA, a company operating in Buenos Aires, has requested for
reorganization after failing to pay its liabilities since
March 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 Court No. 20. Clerk of Court No. 40
assists on this case.
The debtor can be reached at:
Nicol SA
Avenida Directorio 4099
Buenos Aires, Argentina
PROVINCIA LEASING: Evaluadora Rates ARS32-Million Certs. at D
-------------------------------------------------------------
Evaluadora Latinoamericana S.A. Calificadora de Riesgo rated
Provincia Leasing Creditos I's certificados de participacion for
ARS32 million, due May 16, 2007, D.
TRANSPORTE CHARACANI: Claims Verification Is Until April 30
-----------------------------------------------------------
Maria Chiapa, the court-appointed trustee for Transporte
Characani SA's bankruptcy proceeding, will verify creditors'
proofs of claim until April 30, 2007.
Under the Argentine bankruptcy law, Ms. Chiapa is required to
present the validated claims in court as individual reports.
Court No. 18 in Buenos Aires' Civil and Commercial Tribunal will
determine if the verified claims are admissible, taking into
account the trustee's opinion, and the objections and challenges
raised by Transporte Characani and its creditors.
Inadmissible claims may be subject for appeal in a separate
proceeding known as an appeal for reversal.
Ms. Chiapa will also submit a general report that contains an
audit of Transporte Characani's accounting and banking records.
The report submission dates have not been disclosed.
Transporte Characani was forced into bankruptcy at the behest of
Obra Social de los Empleados de Comercio y Actividades Civiles,
which it owes US$79,537.77.
Clerk No. 36 assists the court in the proceeding.
The debtor can be reached at:
Transporte Characani SA
Olavaria 1463
Buenos Aires, Argentina
The trustee can be reached at:
Maria Chiapa
Aguaribay 6736
Buenos Aires, Argentina
===============
B A R B A D O S
===============
HILTON HOTELS: Sells Scandic Hotel Chain for US$1.1 Billion
-----------------------------------------------------------
Hilton Hotels Corp. reported the exchange of contracts to sell
its Scandic Hotel chain to private equity group EQT for
approximately US$1.1 billion. Net proceeds after transaction
costs and taxes are expected to be approximately US$1.04
billion.
Based on trailing 12-month recurring earnings from Scandic
before interest, taxes, depreciation and amortization or EBITDA,
the sale price represents an EBITDA multiple of approximately 10
times. After adjusting for normal replacement for furniture,
fixtures and equipment, the implied capitalization rate on the
sale is expected to be approximately 6.5%. The transaction is
subject to a number of conditions, but is expected to be
completed in April 2007, subject to clearance from the European
Union regulators. Hilton Hotels intends to use the proceeds of
the sale to pay down debt.
Hilton Hotels disclosed in August 2006 that the company would
explore strategic alternatives for the Scandic Hotel chain, with
a view to selling all or part of the business.
Scandic is the largest hotel operator in the Nordic region,
operating full service hotels in the mid-market segment. The
transaction involves the sale of 132 hotels, of which 128 are
Scandic hotels and three are Hilton hotels plus one other hotel.
Of the 132 hotels, three are owned, 121 are leased, five are
managed, and three are franchised.
Upon completion of the transaction, Hilton Hotels will continue
to have a presence in Nordic with six Hilton hotels -- three in
Finland (including the Hilton Helsinki Vantaa Airport due to
open in August 2007), two in Sweden and one in Denmark at
Copenhagen airport.
Hilton Hotels Executive Vice President and Chief Financial
Officer said, "This proposed sale represents the latest
execution of our strategy to generate a higher proportion of
income from management and franchise fees, while also reducing
debt. This particular transaction will also enable us to reduce
our income from leased hotels which, combined with a stronger
balance sheet, would significantly strengthen our credit
profile."
Hilton Hotels Executive Vice President and Chief Executive of
International Operations noted, "Scandic is a prominent and
respected brand with an exceptional market position in the
Nordic countries. The business has performed very strongly over
the last year, which is testimony to the commitment and efforts
of the management and employees during the sale process.
Following the re-unification of the Hilton Hotels business
earlier last year, a key focus of our strategy is international
development. This is underpinned by an excellent portfolio of
existing brands, including a number of strong mid-market brands
with significant international appeal and potential for growth."
Hilton Hotels will enter into a short-term "Transitional
Services Agreement" with EQT to include key service and
operational areas, including the Hilton Reservations and
Customer Care, Honors guest loyalty program and information
technology system and support.
Citigroup Global Markets Ltd. and Mannheimer Swartling advised
Hilton Hotels.
Assuming the sale of Scandic closes in April 2007 and net
proceeds are used to pay down debt, this transaction is expected
to reduce the company's 2007 recurring EPS by US$.10 per share.
Approximately US$.07 per share of this expected reduction
results directly from the sale of Scandic, while approximately
US$.03 per share is due to an increase in the company's overall
effective tax rate as a result of selling assets outside the US.
The company's full year 2007 effective tax rate is now expected
to be approximately 35%.
Headquartered in Beverly Hills, California, Hilton Hotels Corp.
-- http://www.hilton.com/-- together with its subsidiaries,
engages in the ownership, management, and development of hotels,
resorts, and timeshare properties, as well as in the franchising
of lodging properties in the United States and internationally,
including Barbados, Costa Rica and Trinidad and Tobago in Latin
America. Hilton Hotels also operates in the United Kingdom,
Germany, Belgium, Estonia, Lithuania, Norway, Denmark, Finland,
Italy, The Netherlands, Sweden, Indonesia, Australia, Austria,
India, Philippines, Vietnam.
* * *
As reported in the Troubled Company Reporter-Latin America on
Feb. 28, 2007, Moody's Investors Service upgraded these ratings
on Hilton Hotels Corporation:
-- Corporate family rating to Ba1 from Ba2
-- Senior secured bank facility to Ba1, LGD4 from Ba2, LGD4
-- Senior bonds, debenture and convertible notes to Ba1, LGD4
from Ba2, LGD4
-- Multiple seniority shelf to (P)Ba1, LGD4, from (P)Ba2,
LGD4, and to (P)Ba2, LGD6 from (P)B1, LGD6
Moody's also confirmed:
-- Commercial paper at Not Prime.
=============
B E R M U D A
=============
SCOTTISH RE: Shareholders Okay MassMutal Capital & Cerberus Deal
----------------------------------------------------------------
Scottish Re Group Limited's shareholders approved a set of
proposals relating to the investment by MassMutual Capital
Partners LLC and an affiliate of Cerberus Capital Management,
L.P. at an Extraordinary General Meeting of Shareholders that
was held in Hamilton, Bermuda. The approval of the proposals by
the shareholders represents an important step in the closing of
the transaction, which after receiving regulatory approval, will
result in MassMutual Capital and Cerberus each investing US$300
million into the company for a total equity investment of US$600
million. Upon close of the transaction, MassMutual Capital and
Cerberus will have a controlling voting equity interest in the
company.
"We are very pleased that our shareholders have approved the
transaction and, on behalf of the board of directors, we thank
them for their support during this difficult period," said Paul
Goldean, Scottish Re's Chief Executive Officer. "We look
forward to expeditiously closing the transaction and working
with MassMutual Capital and Cerberus to achieve our financial
goals and deliver long-term value to our shareholders."
Pending certain regulatory approvals, the transaction is
expected to close in early second quarter of this year.
About Scottish Re Group
Scottish Re Group Limited -- http://www.scottishre.com/--
provides reinsurance of life insurance, annuities and annuity-
type products through its operating companies in Bermuda,
Charlotte, North Carolina, Dublin, Ireland, Grand Cayman, and
Windsor, England. At March 31, 2006, the reinsurer's balance
sheet showed US$12.2 billion assets and US$10.8 billion in
liabilities.
SCOTTISH RE: S&P Holds Ratings Watch on MassMutual/Cerberus Deal
----------------------------------------------------------------
Standard & Poor's Ratings Services said that its ratings on
Scottish Re Group Ltd. (B/Watch Dev/--) and affiliated operating
companies remain on CreditWatch with developing implications
following the announcement by the company that the shareholders
have approved the transaction by which MassMutual Capital
Partners LLC and affiliates of Cerberus Capital Management L.P.
would provide an equity infusion of US$600 million in a
transaction to close in the second quarter of 2007.
MassMutual Capital and Cerberus Capital will also provide
additional funds for short- and long-term liquidity and capital
needs. The transaction among the parties is planned to close in
the second quarter of 2007, assuming regulatory approval. The
shareholder approval is a positive step for Scottish Re.
If the deal closes, Standard & Poor's expects to raise the
counterparty credit rating on Scottish Re Group Ltd. to a level
not likely to exceed 'BB-' and would raise the counterparty
credit and financial strength ratings on Scottish Re's operating
companies as well as the ratings on dependent unwrapped
securitized deals related to Scottish Re to levels not likely to
exceed 'BBB-'. However, in the event the deal is not
consummated, the current ratings would likely be lowered
substantially (three or more notches). Without the deal, it
would be difficult for Scottish Re to proceed with an orderly
run-off or manage as an operating company. At the closing of
the proposed equity infusion, Standard & Poor's will evaluate
the ratings based on the terms of the transaction, the financial
and operational profile of the company, and the expected
prospective financial and business profile of Scottish Re.
Scottish Re Group Ltd.(NYSE:SCT) -- http://www.scottishre.com/--
provides reinsurance of life insurance, annuities and annuity-
type products through its operating companies in Bermuda,
Charlotte, North Carolina, Dublin, Ireland, Grand Cayman, and
Windsor, England.
=============
B O L I V I A
=============
* BOLIVIA: Inks US$2.1-Bil. Plant Construction Pact with Jindal
---------------------------------------------------------------
Indian manufacturer and supplier of steel Jindal Steel and Power
has signed a US$2.1 billion deal with the Bolivian government
for the construction of a new steel plant in the country.
"We have reached an agreement with the Bolivian government to
set up a six million ton sponge iron plant, 10 million ton
pellet plant and 1.7 million ton steel plant at an investment of
US$2.1 billion," Jindal's Finance Director Sushil Maroo was
quoted by the Press Trust of India as saying.
The plant will be constructed at El Mutun, which has one of the
worlds largest iron-ore mines. According to Press Trust, Jindal
has won a contract to exploit 50% of the El Mutun reserves.
An accord sealing the agreement between Jindal and Bolivia is
expected to be signed within 45 days, reports said.
Gas Supply
Meanwhile, Jindal has also secured a gas supply contract with
Bolivia.
"Bolivia, a major natural gas producer, has agreed to sell
Jindal natural gas at US$3.91 per million British thermal unit
for steel making, which represents 70 per cent of the project's
power needs," the Khaleej Times reports, citing a company
statement.
According to ABI, what Jindal got for the price of gas is US$4
to US$5 less than what Bolivia charges exports to Brazil and
Argentina.
* * *
Fitch Ratings assigned these ratings on Bolivia:
Rating Rating Date
Country Ceiling B- Jun. 17, 2004
Long Term IDR B- Dec. 14, 2005
Local Currency
Long Term Issuer
Default Rating B- Dec. 14, 2005
===========
B R A Z I L
===========
BANCO NACIONAL: Approves BRL39.7-Million Financing to Itajai
------------------------------------------------------------
BNDES aka Banco Nacional de Desenvolvimento Economico e Social
approved a BRL39.7 million financing to the environmental
sanitation project of the Municipality of Itajai, in Santa
Catarina, for water supply, sanitary sewage collection and
treatment projects.
With a BRL49.6 million total investment, Itajai's project is the
first sanitation approved in the ambit of Growth Acceleration
Program and marks the beginning of a new investment cycle in the
Municipality's basic sanitation.
The endeavor will benefit 30% of Itajai's population (roughly 65
thousand inhabitants) who, nowadays, experiences the shortage of
water supply, as well as the other consumers, who will start
having more supply quality and regularity. However, the 86.7
thousand-meter sewer network will support roughly 30 thousand
people, what is equivalent to 17% of the population.
Sao Roque water treatment station will be enlarged and the
reservoirs will be constructed in Balneario Praia Brava and in
the District of Canhanduba. The sewer network, pumping stations
and interceptor will be installed in the City's downtown and
surrounding Districts, such as Cabecudas, Fazenda, Vila
Operaria, Sao Joao and Cordeiros. Also, in the District of
Cordeiros it will be installed a sewage treatment station.
The investments in Sao Roque water treatment station will
increase the production of treated water from 695 liters/second
to 1,000 liters/second. The reservoirs of Arapongas and Morro
Cortado will increase the storage capacity of treated water from
230 thousand to 2 billion liters.
Integrated to the national priorities of investment in basic
infrastructure, the project objective is to promote the urban
development in Itajai's region.
The Municipality has neither the collector network nor sewage
treatment system and the maximum storage capacity is 59 million
liters per day, what is insufficient to support a population of
210 thousand inhabitants. The contaminated water injuries the
population's health in a way that 50% of the leave of absences
are due to diarrhea.
Banco Nacional de Desenvolvimento Economico e Social is Brazil's
national development bank. It provides financing for projects
within Brazil and plays a major role in the privatization
programs undertaken by the federal government.
* * *
As reported on Nov. 27, 2006, Standard & Poor's Ratings Services
changed the ratings outlook to Positive from Stable on Banco
Nacional de Desenvolvimento Economico e Social SA's BB Foreign
currency counterparty credit rating and BB+ Local currency
counterparty credit rating.
BRASIL TELECOM: Orascom Offers to Buy Telecom Italia's Stake
------------------------------------------------------------
Egyptian company Orascom Telecom has offered to purchase Telecom
Italia SpA's 38% stake in Brasil Telecom Participacoes SA.
Business tycoon Naguib Sawiris, Orascom's owner, confirmed in a
statement Friday that its interest in Brasil Telecom is in line
with its investment strategy.
Brazilian daily La Folha de San Paulo reported that the Egyptian
billionaire is prepared to pay US$450 million for the stake.
Telecom Italia has hired JPMorgan Chase & Co. to manage the
sale, Bloomberg News says.
"We're getting close to a definition of the future of Brasil
Telecom," Jacqueline Lison, a telecom analyst at Sao Paulo-
based Banco Fator, who has a buy rating on the stock told
Bloomberg. "Investors have been waiting for a long time to know
who will control Brasil Telecom."
The Brazilian telco's shares rose 31 ents to BRL16.81 because of
the news, Bloomberg says.
About Orascom Telecom
Orascom Telecom Holding S.A.E or Orascom Telecom --
http://www.orascom.com/-- is a mobile telecommunications
company with GSM operations in seven emerging markets in the
Middle East, Africa and South Asia, having a total population
under license of approximately 460 million with an average
mobile telephony penetration of approximately 8%.
About Brasil Telecom
Headquartered in Brasilia, Brazil, Brasil Telecom Participacoes
SA -- http://www.brasiltelecom.com.br-- is a holding company
that conducts substantially all of its operations through its
wholly owned subsidiary, Brasil Telecom SA. The fixed-line
telecommunications services offered to the company's customers
include local services, including all calls that originate and
terminate within a single local area in the region, as well as
installation, monthly subscription, measured services, public
telephones and supplemental local services; intraregional long-
distance services, which include intrastate and interstate
calls; interregional and international long-distance services;
network services, including interconnection and leasing; data
transmission services; wireless services, and other services.
* * *
Brasil Telecom Participacoes' local currency long-term debt
carries Fitch's BB+ rating.
* * *
Moody's Investors Service placed a Ba1 local currency long-term
issuer rating on Brasil Telecom.
COMPANHIA ENERGETICA: Board Plans for Bonus & Dividend Payments
---------------------------------------------------------------
Companhia Energetica de Minas Gerais notified stockholders that
the Board of Directors, at its meeting held on Feb. 28, 2007,
decided to propose to the Annual General Meeting to be held by
April 30, 2007:
a) Increase in registered capital for BRL810,769,089,
corresponding to an increase of 50% in the present
registered capital, using funds from the Earnings Reserve,
which will result in a bonus of 500 new shares, of the
same type and carrying the same rights as those currently
held, with nominal value of BRL0.01 for each existing
group of one thousand shares.
b) BRL1,381,781,000 will be distributed in the form of
dividends, in view of the net profit of BRL1,718,841,000
ascertained for the business year of 2006, as follows:
1) BRL884,781,000 in the form of obligatory dividend,
payable to the company's stockholders under sub-item
"a" of the Sole Sub-paragraph of Clause 21 of the
Bylaws and the applicable legislation, made up of the
following portions:
i) Interest on Equity in the amount of
BRL169,067,000, corresponding to BRL1.0430781547
per thousand shares, decided by the Board's
meeting held on April 27, 2006, payable to
stockholders whose names were in the Nominal Share
Registry on May 11, 2006.
ii) Complementary dividends in the amount of
BRL715,714,000, corresponding to BRL2.943786152
per thousand shares.
2) BRL497,000,000 in the form of extraordinary dividend,
corresponding to BRL2.0441988247 per thousand shares.
c) The shares will be grouped in the proportion of 500
shares of nominal value BRL0.01, to 1 share of the
same type and as the shares held, with nominal value of
BRL5.00.
The company disclosed that within a period to be
established of no less than 30 days after the holding of
the said Meeting, shareholders may if they wish adjust
their stockholding positions in each type of share in
multiple lots of 500 shares, privately or through any
broker authorized to operate on the Sao Paulo Stock
Exchange.
As from the day immediately following the end of the
Period for adjustment of fractions referred to the
company's shares will be traded exclusively for a single
price.
The company said that after the period for adjustment of
shareholding positions by their holders, any resulting
factions of shares will be separated, grouped in whole
numbers, and sold by auction on the Sao Paulo Stock
Exchange, on a date to be announced.
After settlement of the auction, amounts resulting from
the sale of shares will be credited to the respective
holders of fractions together with the payment of the
first portion of the dividend for the business year 2006.
The company noted that the bonus payment, dividends payment, and
first split are conditional upon homologation by the Ordinary
and Extraordinary General Meetings to be held by April 30, 2007.
Companhia Energetica de Minas Gerais -- http://www.cemig.com.br/
-- is one of the largest and most important electric energy
utilities in Brazil due to its strategic location, its technical
expertise and its market. Cemig's concession area extends
throughout nearly 96.7% of the State of Minas Gerais, Brazil.
Cemig owns and operates 52 power plants, of which six are in
partnership with private enterprises, relying on a predominantly
hydroelectric energy matrix. Electric energy is produced to
supply more than 17 million people living in the state's 774
municipalities. In addition to those 52 plants, another three
are currently under construction.
Cemig is also active in several other states, through ventures
for the generation or the commercialization of energy in these
Brazilian states: in Santa Catarina (generation), Rio de Janeiro
(commercialization and generation), Espirito Santo (generation)
and Rio Grande do Sul (commercialization).
* * *
Cemig's BRL312,500,000 12.7% debentures due Nov. 1, 2009, carry
Moody's B1 rating.
ITRON INC: Completes Private Placement of 4,086,958 Shares
----------------------------------------------------------
Itron Inc. announced that it has completed the private placement
of 4,086,958 shares of its common stock to ten institutional
investors. The private placement, which was previously
announced, is pursuant to a securities purchase agreement dated
Feb. 25, 2007, for an aggregate purchase price of US$235
million, or US$57.50 per share.
The shares were sold pursuant to an exemption from registration
afforded by Section 4 (2) of the Securities Act of 1933, as
amended, and Rule 506 of Regulation D promulgated there under
and may not be offered or sold in the United States absent
registration or an applicable exemption from registration.
Itron has agreed to register re-sales of the shares not later
than 140 days from the date hereof.
Itron Inc. (NASDAQ:ITRI) -- http://www.itron.com/-- is a
technology provider and critical source of knowledge to the
global energy and water industries. Nearly 3,000 utilities
worldwide rely on Itron technology to provide the knowledge they
require to optimize the delivery and use of energy and water.
Itron creates value for its clients by providing industry-
leading solutions for electricity metering; meter data
collection; energy information management; demand response; load
forecasting, analysis and consulting services; distribution
system design and optimization; web-based workforce automation;
and enterprise and residential energy management. Effective
April 2006, Itron has acquired Brazil's ELO Tecnologia. Itron
Tecnologia has offices and a manufacturing assembly facility in
Campinas, Sao Paulo, Brazil and offices in Santiago, Chile.
* * *
As reported in the Troubled Company Reporter on March 2, 2007,
Standard & Poor's Ratings Services placed its ratings, including
its 'BB-' corporate credit rating, on Itron Inc. on CreditWatch
with negative implications.
NRG ENERGY: 2006 Net Income Increases to US$621 Million
-------------------------------------------------------
NRG Energy Inc. filed its annual financial statements for the
year ended Dec. 31, 2006, with the U.S. Securities and Exchange
Commission on Feb. 28, 2007.
The company's total operating revenues were US$5.62 billion for
the year ended Dec. 31, 2006, as compared with US$2.43 billion
for the year ended Dec. 31, 2005, an increase of US$3.19
billion.
Net income for the year 2006 was US$621 million, up from US$84
million for the year 2005.
Cost of operations for 2006 was US$3.27 billion, as compared
with US$1.83 billion for 2005, an increase of US$1.43 billion.
The company's annual depreciation and amortization expense for
2006 and 2005 was US$593 million and US$162 million,
respectively. Its general, administrative and development costs
for 2006 were US$316 million, as compared with US$181 million in
the previous year. General, administrative and development
costs were adversely impacted by US$6 million of costs
associated with the unsolicited acquisition offer by Mirant
Corp. and about US$14 million of NRG Texas integration costs.
Equity earnings from the company's investments in unconsolidated
affiliates were US$60 million for the year ended Dec. 31, 2006,
down from US$104 million for the prior-year.
During 2006, the company sold its interests in James River and
Cadillac, as well as interests in certain Latin American power
funds for a pre-tax loss of US$6 million, a pre-tax gain of
$11 million, and a pre-tax gain of US$3 million, respectively.
Refinancing expenses incurred in 2006 and 2005 were US$187
million and US$65 million, respectively. In the first quarter
2006, the company partially financed the acquisition of Texas
Genco LLC through borrowings under new debt facilities and
repaid and terminated previous debt facilities. As a result of
this financing, it incurred US$178 million of refinancing
expenses.
Interest expense for the year ended Dec. 31, 2006, was
US$599 million, as compared with US$184 million for the year
ended Dec. 31, 2005. Income tax expense was US$325 million and
US$47 million for the years ended Dec. 31, 2006, and 2005,
respectively.
For the years ended Dec. 31, 2006, and 2005, the company
recorded income from discontinued operations, net of income tax
expense of US$66 million and US$12 million, respectively.
The company's balance sheet as of Dec. 31, 2006, showed
US$19.435 billion in total assets, US$13.529 billion in total
liabilities, US$1 million in minority interests, US$247 million
in outstanding convertible perpetual preferred shares, and
US$5.658 billion in total stockholders' equity.
A full-text copy of the company's 2006 annual report is
available for free at http://ResearchArchives.com/t/s?1aa9
About NRG Energy
Headquartered in Princeton, New Jersey, NRG Energy Inc.
(NYSE:NRG) owns and operates power generating facilities,
primarily in Texas and the northeast, south central and western
regions of the United States. NRG also owns generating
facilities in Australia, Brazil, and Germany.
* * *
As reported in the Troubled Company Reporter on Nov. 14, 2006,
Fitch Ratings assigned a rating of 'B+/RR3' on NRG Energy's
issuance of US$1.1 billion senior notes due 2011. This issue
will rank equally with NRG's other senior unsecured obligations.
Fitch said the rating outlook is stable.
PETROLEO BRASILEIRO: Awards US$150MM Pipe Contract to Technip
-------------------------------------------------------------
Brazilian state oil firm Petroleo Brasileiro has awarded a
US$150-million pipe contract to France's hydrocarbons and
petrochemicals services company Technip, the latter said in a
statement.
Technip said it will perform the engineering, project
management, manufacturing, and testing of six different types of
flexible pipes for Petroleo Brasileiro's Roncador P-54 project.
According to Technip's statement, the project includes 11
production and six water injection undersea wells at water
depths down to 1,740 meters and connected in direct tie-back to
the P-54 floating production, storage and offloading vessel
anchored at a water depth of 1,400 million.
Technip's Rio de Janeiro operations and engineering center will
conduct the engineering and project management. Meanwhile, the
firm's plant in Vitoria will manufacture the 142 kilometers of
flexible pipes, Business News Americas reports.
Headquartered in Rio de Janeiro, Brazil, Petroleo Brasileiro SA
aka Petrobras -- http://www2.petrobras.com.br/ingles/index.asp
-- was founded in 1953. The company explores, produces,
refines, transports, markets, distributes oil and natural gas
and power to various wholesale customers and retail distributors
in Brazil.
Petrobras has operations in China, India, Japan, and Singapore.
Petroleo Brasileiro SA's long-term corporate family rating is
rated Ba3 by Moody's.
Fitch Ratings assigned these ratings on Petroleo Brasileiro's
senior unsecured notes:
Maturity Date Amount Rate Ratings
------------- ------ ---- -------
April 1, 2008 US$400,000,000 9% BB+
July 2, 2013 US$750,000,000 9.125% BB+
Sept. 15, 2014 US$650,000,000 7.75% BB+
Dec. 10, 2018 US$750,000,000 8.375% BB+
Fitch upgraded the foreign currency rating of Petrobras to BB+
from BB, with positive outlook, in conjunction with Fitch's
upgrade of the long-term foreign and local currency issuer
default rating of the Federative Republic of Brazil to BB, from
BB- on June 29, 2006.
PETROLEO BRASILEIRO: Finds Reserves in Caxareu Field
----------------------------------------------------
Petroleo Brasileiro SA aka Petrobras reported that discovery
well 4-ESS-172-ES (NPA acronym: 4-BRSA-446-ESS) in Caxareu field
has located reservoirs saturated with light oil under a thick
layer of salt at a water depth of 1,011 meters and at a final
depth of 4,862 meters, which have shown to have excellent
productivity in a formation test carried out with a lined well.
This test indicated potential production may top-out at 10,000
barrels per day, while preliminary geological studies reveal an
in place potential of some 570 million barrels.
This accumulation is situated in old BC-60 block, off the coast
of Espirito Santo, nearly 120 km to the south of the city of
Vitoria and 15 kilometers southeast of the Jubarte oil field.
It constitutes a new exploratory horizon within the Caxareu oil
field, in northern Campos Basin, which was already declared
commercial to the National Petroleum Agency in December 2006, a
fact that was communicated to the market at the time.
The discovery was identified during the1-ESS-121-ESS well
campaign as part of the Discovery Assessment Plan, in an area
operated by Petrobras, which has 100% of the concession.
Additional studies will be undertaken to better evaluate the
full potential of this field.
Headquartered in Rio de Janeiro, Brazil, Petroleo Brasileiro SA
aka Petrobras -- http://www2.petrobras.com.br/ingles/index.asp
-- was founded in 1953. The company explores, produces,
refines, transports, markets, distributes oil and natural gas
and power to various wholesale customers and retail distributors
in Brazil.
Petrobras has operations in China, India, Japan, and Singapore.
Petroleo Brasileiro SA's long-term corporate family rating is
rated Ba3 by Moody's.
Fitch Ratings assigned these ratings on Petroleo Brasileiro's
senior unsecured notes:
Maturity Date Amount Rate Ratings
------------- ------ ---- -------
April 1, 2008 US$400,000,000 9% BB+
July 2, 2013 US$750,000,000 9.125% BB+
Sept. 15, 2014 US$650,000,000 7.75% BB+
Dec. 10, 2018 US$750,000,000 8.375% BB+
Fitch upgraded the foreign currency rating of Petrobras to BB+
from BB, with positive outlook, in conjunction with Fitch's
upgrade of the long-term foreign and local currency issuer
default rating of the Federative Republic of Brazil to BB, from
BB- on June 29, 2006.
TELE NORTE: Will Use Oi Brand in All Its Services
-------------------------------------------------
Tele Norte Leste Participacoes said in a statement that it will
unify its fixed, mobile, Internet and entertainment services
under the Oi brand.
Business News Americas relates that Tele Norte's fixed line
segment will be called Oi Fixo, while the Internet service Velox
will be renamed Oi Velox.
The integration will be gradually adopted through August 2007,
BNamericas notes, citing Tele Norte.
"This innovation strengthens the company's position as the sole
provider of integrated communications solutions in Brazil," Tele
Norte said in a statement.
Headquartered in Rio de Janeiro, Brazil, Tele Norte Leste
Participacoes SA -- http://www.telemar.com.br-- is a provider
of fixed-line telecommunications services in South America. The
company markets its services under its Telemar brand name. Tele
Norte's subsidiaries include Telemar Norte Leste SA; TNL PCS SA;
Telemar Internet Ltda.; and Companhia AIX Participacoes SA.
* * *
As reported in the Troubled Company Reporter on Feb. 5, 2007,
Standard & Poor's Ratings Services raised its long-term
corporate credit rating on Brazil-based telecom service
providers Tele Norte Leste Participacoes SA and Telemar Norte
Leste SA, jointly referred to as Telemar, to 'BB+' from 'BB'.
At the same time, Standard and Poor's revised its ratings on the
combined BRL300 million outstanding local debentures of Telemar
Participacoes SA in Brazil National Scale to 'brAA-' from
'brA+', and assigned o 'brAA-' rating to TmarPart's proposed
five-year BRL$250 million debentures.
===========================
C A Y M A N I S L A N D S
===========================
BIMINI SHIPPING: Proofs of Claim Filing Ends on March 20
--------------------------------------------------------
Bimini Shipping, Ltd., are given until March 20, 2007, to prove
their claims to Mr. James Webster Howe, the company's
liquidator, or be excluded from receiving any distribution or
payment.
In their proofs of claim, creditors must indicate their full
names, addresses, the full particulars of their debts or claims,
and the names and addresses of their lawyers, if any.
Bimini Shipping Ltd.'s shareholders agreed on March 20, 2007, to
place the company into voluntary liquidation under The Companies
Law (2004 Revision) of the Cayman Islands.
The liquidators can be reached at:
James Webster Howe
c/o Campbells
4th Floor, Scotia Center
P.O. Box 884
Grand Cayman KY1-1103
Cayman Islands
DREWCAT CAPITAL: Proofs of Claim Filing Ends on March 21
--------------------------------------------------------
Drewcat Capital, Ltd., are given until March 21, 2007, to prove
their claims to Cereita Lawrence and Janet Crawshaw, the
company's liquidator, or be excluded from receiving any
distribution or payment.
In their proofs of claim, creditors must indicate their full
names, addresses, the full particulars of their debts or claims,
and the names and addresses of their lawyers, if any.
Drewcat Capital's shareholders agreed on March 15, 2007, to
place the company into voluntary liquidation under the The
Companies Law (2004 Revision) of the Cayman Islands.
The liquidators can be reached at:
Cereita Lawrence
Janet Crawshaw
P.O. Box 1109
Grand Cayman KY1-1102
Cayman Islands
Telephone: 345-914-7510
Fax: 345-949-7634
DREWCAT CAPITAL: Sets Last Shareholders Meeting for March 21
------------------------------------------------------------
Drewcat Capital, Ltd., will hold its final shareholders meeting
on March 21, 2007, at 10:30 a.m., at:
Strathvale House, North Church Street
P.O. Box 1109
Grand Cayman KY1-1102
Cayman Islands
These agendas 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 will be
allowed to appoint a proxy, who need not be a member, in his
stead.
The liquidators can be reached at:
Cereita Lawrence
Janet Crawshaw
Strathvale House, North Church Street
P.O. Box 1109
Grand Cayman KY1-1102
Cayman Islands
Telephone: 345-914-7510
Fax: 345-949-7634
DYNAMIC CAYMAN: Final Shareholders Meeting Is on March 20
---------------------------------------------------------
Dynamic Cayman Investors, Ltd., will hold its final shareholders
meeting on March 20, 2007, at 11:00 a.m., at the registered
office of the company.
These agendas will be followed 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 will be
allowed to appoint a proxy, who need not be a member, in his
stead.
The liquidator can be reached at:
Russell Smith
Attention: Paul Monico
P.O. Box 2499
George Town, Grand Cayman
Cayman Islands
Telephone: (345) 946 0820
Fax: (345) 946 0864
EQUITY HAA: Final Shareholders Meeting Is on March 20
-----------------------------------------------------
Equity Haa, Ltd., will hold its final shareholders meeting on
March 20, 2007, at 11:30 a.m., at the registered office of the
company.
These agendas will be followed 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 will be
allowed to appoint a proxy, who need not be a member, in his
stead.
The liquidator can be reached at:
Attention: Evania Ebanks
P.O. Box 1111
Grand Cayman, Cayman Islands
Telephone: (345) 949-5122
Fax: (345) 949-7920
GFN CORP: Court to Hear Wind Up Petition on March 16
----------------------------------------------------
The Grand Court of the Cayman Islands will hear a petition to
wind up GFN Corporation Ltd. on March 16, 2007, at 10:00 a.m.,
at:
Law Courts
George Town, Grand Cayman
Cayman Islands
Joint official liquidators Richard Fogerty and G. James Cleaver
at Kroll (Cayman) Ltd., acting in behalf of Bancredit Cayman
Ltd., filed the petition on Jan. 5, 2007.
Any creditor or contributory of GFN Corporation who wants to
support or oppose the making of an order in the petition may
attend the hearing in person or by an attorney. A copy of the
petition can be obtained from:
The Joint Official Liquidators of Bancredit Cayman Ltd.
c/o Maples and Calder
P.O. Box 309, George Town,
Ugland House
South Church Street, Grand Cayman
Cayman Islands
Any person who intends to appear on the hearing must write to
Maples and Calder no later than 4:00 p.m. on March 15, 2007.
The debtor can be reached at:
GFN Corporation Limited
CIBC Bank and Trust Company (Cayman) Ltd.
P.O. Box 694, George Town
5th Floor, CIBC Financial Center
11 Dr Roys Drive
Grand Cayman, Cayman Islands
HILDING EQUITY: Final Shareholders Meeting Is on March 20
---------------------------------------------------------
Hilding Equity, Ltd., will hold its final shareholders meeting
on March 20, 2007, at 10:00 a.m., at the registered office of
the company.
These agendas will be followed 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 will be
allowed to appoint a proxy, who need not be a member, in his
stead.
The liquidator can be reached at:
Attention: Evania Ebanks
P.O. Box 1111
Grand Cayman, Cayman Islands
Telephone: (345) 949-5122
Fax: (345) 949-7920
HILDING IIP: Final Shareholders Meeting Is on March 20
------------------------------------------------------
Hilding IIP, Ltd., will hold its final shareholders meeting on
March 20, 2007, at 10:30 a.m., at the registered office of the
company.
These agendas will be followed 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 will be
allowed to appoint a proxy, who need not be a member, in his
stead.
The liquidators can be reached at:
Attention: Evania Ebanks
P.O. Box 1111
Grand Cayman, Cayman Islands
Telephone: (345) 949-5122
Fax: (345) 949-7920
HILDING (SEDCO): Final Shareholders Meeting Is on March 20
----------------------------------------------------------
Hilding (Sedco), Ltd., will hold its final shareholders meeting
on March 20, 2007, at 11:00 a.m., at the registered office of
the company.
These agendas will be followed 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 will be
allowed to appoint a proxy, who need not be a member, in his
stead.
The liquidator can be reached at:
Attention: Evania Ebanks
P.O. Box 1111
Grand Cayman, Cayman Islands
Telephone: (345) 949-5122
Fax: (345) 949-7920
INVESTCORP HILDING INVESTING: Shareholders Meeting Is March 20
--------------------------------------------------------------
Investcorp Hilding Investing, Ltd., will hold its final
shareholders meeting on March 20, 2007, at 12:30 p.m., at the
registered office of the company.
These agendas will be followed 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 will be
allowed to appoint a proxy, who need not be a member, in his
stead.
The liquidator can be reached at:
Attention: Evania Ebanks
P.O. Box 1111
Grand Cayman, Cayman Islands
Telephone: (345) 949-5122
Fax: (345) 949-7920
INVESTCORP HILDING ISLAMIC: Shareholders Meeting Is on March 20
---------------------------------------------------------------
Investcorp Hilding Islamic Financing, Ltd., will hold its final
shareholders meeting on March 20, 2007, at 11:30 a.m., at the
registered office of the company.
These agendas will be followed 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 will be
allowed to appoint a proxy, who need not be a member, in his
stead.
The liquidator can be reached at:
Attention: Evania Ebanks
P.O. Box 1111
Grand Cayman, Cayman Islands
Telephone: (345) 949-5122
Fax: (345) 949-7920
INVESTCORP PRINCIPAL: Final Shareholder Meeting Is on March 13
--------------------------------------------------------------
Investcorp Principal Protected Fund Ltd.'s final shareholders
meeting has been moved to March 13, 2007, at 12:00 p.m. at the
company's office.
As previously reported in the Troubled Company Reporter-Latin
America, the meeting was initially set for Feb. 16, 2007, at
12:00 p.m. in the same venue.
These agendas will be followed during the meeting:
1) accounting of the liquidation process showing how the
winding up has been conducted and how the property will
be disposed of on March 12, 2007, the date of the final
wind up.
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.
The liquidator can be reached at:
Evania Ebanks
P.O. Box 1111
Grand Cayman, Cayman Islands
Tel: (345)-949-5122
Fax: (345)-949-7920
INVESTCORP HILDING (SEDCO): Shareholders Meeting Is on March 20
---------------------------------------------------------------
Investcorp Hilding (Sedco) Islamic Financing, Ltd., will hold
its final shareholders meeting on March 20, 2007, at 1:00 p.m.,
at the registered office of the company.
These agendas will be followed 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 will be
allowed to appoint a proxy, who need not be a member, in his
stead.
The liquidator can be reached at:
Attention: Evania Ebanks
P.O. Box 1111
Grand Cayman, Cayman Islands
Telephone: (345) 949-5122
Fax: (345) 949-7920
KOWLOON LTD: Proofs of Claim Filing Ends on March 20
----------------------------------------------------
Kowloon, Ltd., are given until March 20, 2007, to prove their
claims to Gordon I. MacRae and Naul C. Bodden, the company's
liquidators, or be excluded from receiving any distribution or
payment.
In their proofs of claim, creditors must indicate their full
names, addresses, the full particulars of their debts or claims,
and the names and addresses of their lawyers, if any.
Kowloon Ltd.'s shareholders agreed on March 20, 2007, to place
the company into voluntary liquidation under The Companies Law
(2004 Revision) of the Cayman Islands.
The liquidators can be reached at:
Gordon I. Macrae
Naul C. Bodden
Attention: Korie Drummond
Kroll (Cayman) Ltd.
4th Floor, Bermuda House
Dr. Roy's Drive, Grand Cayman KY1 - 1102
Cayman Islands
Telephone +1 (345) 946-0081
Fax: +1 (345) 946-0082
LANDMARK FUNDING: Final Shareholders Meeting Is on March 20
-----------------------------------------------------------
Landmark Funding, Ltd., will hold its final shareholders meeting
on March 20, 2007, at 9:00 a.m., at the registered office of the
Company.
These agendas will be followed 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 will be
allowed to appoint a proxy, who need not be a member, in his
stead.
The liquidator can be reached at:
Attention: Bonnie Willkom
P.O. Box 1111
Grand Cayman KY1-1102
Cayman Islands
Telephone: (345) 949-5122
Facsimile: (345) 949-7920
MASK HOLDINGS: Final Shareholders Meeting Is on March 20
--------------------------------------------------------
Mask Holdings, Ltd., will hold its final shareholders meeting on
March 20, 2007, at 10:00 a.m., at:
Kleinwort Benson House
Wests Centre, St Helier
Jersey, JE4 8PQ
These agendas will be followed 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 will be
allowed to appoint a proxy, who need not be a member, in his
stead.
The liquidator can be reached at:
Corporate Secretaries (Jersey) Ltd.
c/o Maples and Calder
P.O. Box 309
George Town, Ugland House
South Church Street, Grand Cayman
Cayman Islands
VOORBURG INVESTMENTS: Proofs of Claim Filing Ends on March 21
-------------------------------------------------------------
Voorburg Investments (1980), Ltd., are given until
March 21, 2007, to prove their claims to Linburgh Martin and
Jeff Arkley, the company's liquidators, or be excluded from
receiving any distribution or payment.
In their proofs of claim, creditors must indicate their full
names, addresses, the full particulars of their debts or claims,
and the names and addresses of their lawyers, if any.
Voorburg Investments Ltd shareholders agreed on March 21, 2007,
to place the company into voluntary liquidation under The
Companies Law (2004 Revision).
The liquidators can be reached at:
Jeff Arkley
Linburgh Martin
Attention: Neil Gray
Close Brothers (Cayman) Ltd.
Fourth Floor, Harbour Place
P.O. Box 1034
George Town, Grand Cayman
Telephone: (345) 949 8455
Fax: (345) 949 8499
=========
C H I L E
=========
CONSTELLATION BRANDS: Buyback Prompts Fitch to Lower Ratings
------------------------------------------------------------
Fitch Ratings has downgraded its ratings on Constellation Brands
Inc:
-- Issuer Default Rating (IDR) to 'BB-' from 'BB';
-- Bank credit facility to 'BB-' from 'BB';
-- Senior unsecured notes to 'BB-' from 'BB'; and
-- Senior subordinated notes to 'B+' from 'BB-'.
The Rating Outlook has been revised to Negative.
Fitch's ratings apply to Constellation Brand's US$3.9 billion
credit facilities, US$1.2 billion of senior unsecured debt, and
US$250 million of senior subordinated notes.
The downgrade and Outlook revision reflect Constellation Brand's
announcement that a US$500 million share repurchase program has
been authorized on top of the pending SVEDKA acquisition. The
company's debt levels are expected to be meaningfully higher in
fiscal 2008 (ending Feb. 29, 2008) than originally anticipated,
even considering the Vincor acquisition, and demonstrate
management's willingness to operate at higher leverage levels.
In addition, ongoing difficulties in its U.K. operations and
plans to reduce U.S. distributor inventory levels in 2008 will
affect cash flow in fiscal 2008, limiting any improvement in
credit measures despite a full-year contribution from Vincor.
The company completed the acquisition of Vincor on June 5, 2006,
for US$1.4 billion (includes the assumption of debt) following
major acquisitions of BRL Hardy Ltd. for US$1.2 billion in 2003
and Robert Mondavi Corp. for US$1.4 billion in 2004. Since
December 2004, Constellation Brand has also made many niche
acquisitions including minority positions. These acquisitions
have provided Constellation Brand with leading market positions
and a broad portfolio of wine, spirits and beer in diversified
global markets.
Over the intermediate term, it is likely that the company will
continue to make acquisitions that could result in financial and
operational stress. Leverage has increased as a result of
successive acquisitions financed primarily with debt, with a
significant increase in interest expense. Constellation Brand
has an excellent track record of integrating such acquisitions.
The company had applied cash flow to reduce debt, support
capital spending, and restructure acquired operations to enhance
productivity and was able to sell non-essential assets. This
previous pattern of reducing debt prior to taking on additional
acquisitions appears to have been broken and the company may be
becoming more aggressive regarding stock repurchases.
Based in Fairport, New York, Constellation Brands, Inc.
(NYSE:STZ, ASX:CBR) -- http://www.cbrands.com/-- produces and
markets beverage alcohol brands with a broad portfolio across
the wine, spirits and imported beer categories. Well-known
brands in Constellation's portfolio include: Almaden, Arbor
Mist, Vendange, Woodbridge by Robert Mondavi, Hardys, Nobilo,
Kim Crawford, Alice White, Ruffino, Kumala, Robert Mondavi
Private Selection, Rex Goliath, Toasted Head, Blackstone,
Ravenswood, Estancia, Franciscan Oakville Estate, Inniskillin,
Jackson-Triggs, Simi, Robert Mondavi Winery, Stowells,
Blackthorn, Black Velvet, Mr. Boston, Fleischmann's, Paul Masson
Grande Amber Brandy, Chi-Chi's, 99 Schnapps, Ridgemont Reserve
1792, Effen Vodka, Corona Extra, Corona Light, Pacifico, Modelo
Especial, Negra Modelo, St. Pauli Girl, Tsingtao. One of
Constellation Brands wine and grape processing facilities is
located in Casablanca, Chile.
ITRON INC: Ambassador Thomas S. Foley Retires as Director
---------------------------------------------------------
Itron Inc. reported that Ambassador Thomas S. Foley retired
from the Board of Directors of Itron on Feb. 24, 2007.
Ambassador Foley advised the Board that he could not participate
fully in the Board's required attendance and deliberative
processes.
Ambassador Foley will, however, become a company's consultant
and will advise on international business matters.
About Itron
Itron Inc., -- http://www.itron.com/-- is a technology provider
and critical source of knowledge to the global energy and water
industries. Nearly 3,000 utilities worldwide rely on Itron
technology to provide the knowledge they require to optimize the
delivery and use of energy and water. Itron creates value for
its clients by providing industry-leading solutions for
electricity metering; meter data collection; energy information
management; demand response; load forecasting, analysis and
consulting services; distribution system design and
optimization; Web-based workforce automation; and enterprise and
residential energy management. Effective April 2006, Itron has
acquired Brazil's ELO Tecnologia. Itron Tecnologia has offices
and a manufacturing assembly facility in Campinas, Sao Paulo,
Brazil and offices in Santiago, Chile.
As reported in the Troubled Company Reporter-Latin America on
March 1, 2007, Moody's Investors Service place these ratings
under review for possible downgrade:
-- Ba3 Corporate Family Rating
-- Ba3 Probability of Default Rating
-- Baa3 Senior Secured Revolver due 2009
-- Ba1 Subordinated Notes due 2012
LEVI STRAUSS: Nov. 26 Balance Sheet Upside-Down by US$1 Billion
---------------------------------------------------------------
Levi Strauss & Co. reported US$239 million of net income on
US$4.19 billion of net revenues for the fiscal year ended
Nov. 26, 2006, compared with US$156 million of net income on
US$4.22 billion of net revenues in fiscal 2005.
The increase in net income was primarily due to a US$29 million
benefit plan curtailment gain in the third quarter, lower losses
on early extinguishment of debt, and lower income tax and
interest expense. The effective tax rate for 2006 was 30.8%
compared to 44.8% for 2005, driven by a US$32 million benefit
resulting from a modification of the ownership structure of
certain of the company's foreign subsidiaries in the second
quarter of 2006 and a US$29 million net reversal of valuation
allowances in certain jurisdictions in the fourth quarter of
fiscal 2006.
Stable net revenue reflects higher net revenues in the U.S.
Levi's(R), U.S. Dockers(R) and Asia Pacific businesses, offset
by lower net revenues in the Europe and U.S. Levi Strauss
SignatureR) businesses and currency translation.
For the fourth quarter of fiscal 2006, Levi Strauss & Co.
reported US$96 million of net income on US$1.24 billion of net
revenues, compared with US$44 million of net income on US$1.19
billion of net revenues in the same period of fiscal 2005. The
improvement was driven primarily by higher operating income and
lower tax expense.
"Our fourth-quarter performance was encouraging, with net
revenue growth in each of our three regions," said John
Anderson, chief executive officer. "For the full year, we
delivered stable revenues and strong profits, and paid down
debt. The year ended with improved performance in virtually all
of our business units. I am pleased with our positive momentum
heading into 2007."
Selling, general and administrative expenses decreased 2 percent
or US$33 million to US$1.3 billion for fiscal 2006 compared to
the prior year. The decrease reflects reduced advertising and
promotion expense and the US$29 million curtailment gain,
partially offset by costs related to new company-operated retail
stores.
Operating income increased US$24 million to US$614 million
compared to US$589 million in fiscal 2005. The increase was
driven primarily by lower selling, general and administrative
expenses. The operating margin for fiscal 2006 was 14.6 percent
compared to 13.9 percent in fiscal 2005.
Interest expense for the year decreased US$13 million to
US$251 million compared to US$264 million in fiscal 2005. The
decrease was primarily attributable to lower debt levels and
lower average interest rates in fiscal 2006.
Strong cash flow in 2006 is attributable to lower income tax
payments, improved working capital management, and lower
restructuring and interest payments.
"We accomplished our objectives for 2006," said Hans Ploos van
Amstel, chief financial officer. "We ended the year with
revenues growing, and we sustained our strong margins while
increasing our investments in our brands, retail expansion and
SAP. We also delivered strong cash flow, which is a key
priority for us. For 2007, we expect to continue our strong
profits and cash flow and, at minimum, achieve revenue
stability."
At Nov. 26, 2006, the company's balance sheet showed US$2.8
billion in total assets and US$3.8 billion in total liabilities,
resulting in a US$1 billion total stockholders' deficit.
Full-text copies of the company's consolidated financial
statements for the fiscal year ended Nov. 26, 2006, are
available for free at http://researcharchives.com/t/s?1a02
About Levi Strauss
Founded in 1853 by Bavarian immigrant Levi Strauss, Levi Strauss
& Co. -- http://www.levistrauss.com/-- is one of the world's
largest brand-name apparel marketers with sales in more than 110
countries. The company market-leading apparel products are sold
under the Levi's(R), Dockers(R) and Levi Strauss Signature(R)
brands.
Levi Strauss & Co. is privately held by descendants of the
family of Levi Strauss. Shares of company stock are not
publicly traded. Shares of Levi Strauss Japan K.K., the
company's Japanese affiliate, are publicly traded in Japan.
The company employs a staff of approximately 10,000 worldwide,
including approximately 1,010 at the company's San Francisco,
California headquarters. Levi Strauss Europe is headquartered
in Brussels, Belgium, while Levi's Asia Pacific division is
based in Singapore. Levi's has operations in Brazil, Mexico,
Chile and Peru.
PAMPA CALICHERA: S&P Says Ratings Reflect High Leverage
-------------------------------------------------------
Standard & Poor's Ratings Services' ratings on Sociedad de
Inversiones Pampa Calichera S.A. or Pampa reflect the company's
high leverage and its expected volatile debt service coverage,
which varies according to Sociedad Quimica y Minera de Chile,
S.A. or SQM's bottom line performance, and our concerns
regarding SQM's ownership structure. The ratings benefit from
the relatively long tenor of the new debt with no principal
maturities until 2018, a conservative dividend policy limited to
the 30% minimum legal payout, and SQM's volatile but strong
ability to generate cash flow.
Pampa's cash flows depend exclusively on the dividend payments
made by SQM. SQM's dividend stream is volatile, following the
price cycles of SQM's product portfolio, its capital expenditure
or capex requirements, and the use of different financing
alternatives. At 65%, SQM's dividend payout is relatively high,
even under Chilean standards that require a minimum 30% payout;
and is relatively aggressive when contrasted with the company's
intensive capex plan and negative free cash flow generation,
particularly in 2006.
Pampa's financial obligations after the issuance of the new
notes are expected to range between US$17 million and US$20
million per year. Standard & Poor's expect SQM's dividends to
Pampa to cover in excess of 1.7x the financial expenses during
2007. Nevertheless, when evaluating the current financial
structure with a more conservative price scenario (incorporating
pricing trends through the cycle), Standard & Poor's expect this
coverage to decrease to more aggressive levels of 1.40x to 1.45x
in 2008 and 2009, respectively. Given the company will only pay
the minimum legal dividends, Standard & Poor's expect a
significant cash build up (in excess of US$30 million, assuming
prices through the cycle and without considering the initial
cash balance of approximately US$30 million) until the first
principal maturity date in 2018. Refinancing represents a
relevant risk, but the expectation of accumulated cash, coupled
with collateral doubling the nominal amount of the debt, and the
fact that the notes mature in five annual payments, should help
to partially mitigate this concern.
Pro forma after the issuance under analysis and the acquisition
of the additional holdings in SQM, Standard & Poor's expect
total gross debt to represent approximately 45% of total book
capitalization, which we consider aggressive for a holding
company. Nevertheless, the use of debt would be less aggressive
if measured against the market value of Pampa's holding of SQM's
shares (which also guarantees the debt).
Liquidity
Pampa's liquidity position is adequate. As of Dec. 31, 2006,
the company had cash holdings of US$12.3 million. In the short
term, Standard & Poor's expect dividends from SQM net of
operating expenses to exceed interest and dividend payments,
allowing the company to build its cash position.
In addition, the terms and condition of the notes include a debt
service reserve account funded with proceeds of the issuance in
an amount equivalent to one interest payment. The covenant
package has some credit-specific protections, including
limitations on additional debt, limitations on liens, restricted
payments (in excess of the legally required 30%), and
limitations on assets sales.
Collateralization
-- Pledge on SQM shares (in a 2:1 ratio)
-- Total rated debt: US$250 million senior secured notes
Outlook
The stable outlook incorporates our expectations that despite
the volatility of the dividends coming from SQM, Pampa will be
able to build up a significant cash position that, together with
the debt service reserve account, will provide some cushion in a
downturn scenario or in the low part of the industry cycle. The
stable outlook also relies on the value of Pampa's sole asset,
SQM's shares. Raising the ratings would require a significant
and consistent improvement in SQM's dividend payments that would
have the double effect of decreasing net debt and improving
interest coverage. The outlook could be revised to negative and
ratings could be lowered if SQM's dividend payments become
erratic in a way that prevents the company from building up its
cash position, and/or interest coverage becomes close to 1.10x
for at least two consecutive years. A significant change in
SQM's corporate governance, given the complexity and
peculiarities of the ownership structure that conditions Pampa's
ability to receive dividends, will likely affect the ratings.
About SQM
SQM is an integrated producer of several specialty and
industrial chemicals. SQM is the world's leading producer of
specialty plant nutrients, iodine, and lithium carbonate, which
together account for about 75% of consolidated revenues. In
addition, the company has developed a worldwide distribution
network that allows it, given its low-cost competitive profile,
to export approximately 80% of its total production.
About Sociedad De Inversiones Pampa Calichera S.A.
Sociedad De Inversiones Pampa Calichera S.A. is a holding
company whose sole activity is to hold shares of Chile-based
chemical producer SQM. As of Dec. 31, 2006, Pampa has a direct
and indirect 27.94% stake in SQM. It is the company's strategy
to increase its stake in SQM up to 32%, the maximum allowed by
SQM's by-laws. Mr. Julio Ponce Lerou and Yara International ASA
(Yara; BBB+/Stable/A-2) ultimately control Pampa.
As reported in the Troubled Company Reporter-Latin America on
Feb. 6, 2007, S&P assigned its 'BB-' long-term corporate credit
rating to Sociedad de Inversiones Pampa Calichera, with stable
outlook. S&P also assigned a 'BB-' rating to the company's
proposed US$250 million senior secured notes with final maturity
in 2022.
===============
C O L O M B I A
===============
ARMOR HOLDINGS: Wins US$50.3MM Deal to Produce Armored FMTV Cabs
----------------------------------------------------------------
Armor Holdings Inc. disclosed the receipt of a contract
modification valued at up to US$50.3 million for production of
Family of Medium Tactical Vehicle -- FMTV -- armored cabs from
the U.S. Army Tank-automotive and Armaments Command -- TACOM.
The company advised that this new award is to produce Low
Signature Armored Cabs -- LSAC, which urgently addresses the
need for heavy armored vehicles in theatre. Work will be
performed in 2007 by the Aerospace & Defense Group at its
facilities located in Fairfield, Ohio and Sealy, Texas.
Robert Schiller, President of Armor Holdings Inc said, "We are
grateful for the opportunity to increase the number of armored
FMTVs in the U.S. Army's inventory. We also are pleased that
our operations can meet this additional need without impacting
our ability to meet increasing production requirements for the
FMTV, MRAP, and other major vehicle armoring programs."
Headquartered in Jacksonville, Florida, Armor Holdings, Inc.
(NYSE: AH) -- http://www.armorholdings.com/-- manufactures and
distributes security products and vehicle armor systems for the
law enforcement, military, homeland security, and commercial
markets. The company's mobile security division is located in
Mexico, Venezuela, Colombia and Brazil.
* * *
In connection with Moody's Investors Service's implementation of
its new Probability-of-Default and Loss-Given-Default rating
methodology, the rating agency confirmed its Ba3 Corporate
Family Rating for Armor Holdings Inc.
Additionally, Moody's affirmed its B1 ratings on the company's
2% Convertible Senior Subordinated Notes Due 2024 and 8.25%
Senior Subordinated Notes Due 2013. Moody's assigned those
debentures an LGD5 rating suggesting noteholders will experience
a 77% loss in the event of default.
DEL MONTE: Earns US$45.5 Million in Quarter Ended January 28
----------------------------------------------------------
Del Monte Foods Company reported US$45.5 million net income for
the quarter ended Jan. 28, 2007, compared to US$51.9 million of
the same period last year.
The company disclosed net sales for the third quarter of fiscal
2007 of US$907.2 million compared to US$789.6 million last year,
an increase of 14.9%.
"This quarter's solid financial results were driven by the
ongoing successful execution against our strategic initiatives
as we continue to strengthen the foundation of Del Monte,"
Richard G. Wolford, Chairman and CEO of Del Monte Foods, said.
"The strength of our recently acquired pet businesses, growth
from new products and the heightened impact of pricing actions
we took earlier this year drove both the top and bottom line.
These drivers, coupled with continued aggressive cost-reduction
programs, helped the company mitigate ongoing inflationary cost
pressures and are enhancing the long-term earnings performance
potential of our company."
The 14.9% increase in net sales was driven by the acquisitions
of Meow Mix and Milk-Bone. Growth from new products and net
pricing also contributed to the increase in net sales. These
gains were partially offset by volume declines, primarily in
Consumer Products.
Nine Months Ended Jan. 28, 2007 Results
The company reported net sales for the first nine months of
fiscal 2007 of US$2.4 billion compared to US$2.1 billion last
year, an increase of 12.5%. Income from continuing operations
was US$76.2 million, compared to US$95.3 million, in the
previous year.
The 12.5% increase in net sales was driven by the acquisitions
of Meow Mix and Milk-Bone. Increased growth from new products
and net pricing also contributed to the increase in net sales.
These gains were partially offset by a volume decline, driven by
many of the same factors, which impacted the third quarter
fiscal 2007 results.
Outlook
For the fiscal 2007 fourth quarter, the company expects to
deliver sales growth of approximately 13% to 15% over net sales
of US$799.2 million in the fourth quarter of fiscal 2006.
For fiscal 2007, the company continues to expect sales growth of
12% to 15% over fiscal 2006 net sales of US$2.9 billion. Fiscal
2007 net sales growth is expected to be driven primarily by the
Meow Mix and Milk-Bone acquisitions.
About Del Monte Foods
Based in San Francisco, California, Del Monte Foods Company
(NYSE: DLM) -- http://www.delmonte.com/-- produces and
distributes processed vegetables, fruit and tomato products, and
pet products. The products are sold under Del Monte, Contadina,
S&W, Starkist, College Inn, 9Lives, Kibbles 'n Bits, Meow Mix,
Milk-Bone, Pup-Peroni, Snausages, Pounce, and Meaty Bone. The
Group has food-processing plants in South America and has
subsidiaries in Venezuela, Colombia, Ecuador and Peru. The
production facilities are operated in California, the Midwest,
Washington and Texas, as well as 7 distribution centers.
* * *
Standard & Poor's assigned 'BB-' Long-term Foreign and Local
Issuer Credit rating to Del Monte Foods Company.
Fitch Ratings rates Del Monte Foods Company's Issuer default
rating at 'BB-'.
ECOPETROL: Pre-qualifies Contractors for Oil Well Construction
--------------------------------------------------------------
Colombian state-owned oil company Ecopetrol is pre-qualifying
contractors to carry out oil well construction, maintenance and
ancillary field work, Business News Americas reports.
Ecopetrol said in a statement that the pre-qualification process
could take up to two years.
According to BNamericas, Ecopetrol is hosting this month
information meetings on the process in:
-- Bogota,
-- Neiva,
-- Barrancabermeja, and
-- Villavicencio.
BNamericas relates that Ecopetrol wants to boost domestic of oil
and gas output as well as refining and biofuels-production
capacity.
Ecopetrol said in a statement that its crude and other products
exports increased 17% to a record of US$3.31 billion in 2006,
compared to 2005.
The Castilla blend, which comes from the Llanos Orientales
field, represented US$950 million in last year's exports. Fuel
oil exports accounted for US$954 million, BNamericas states.
Ecopetrol is an integrated-oil company that is wholly owned by
the Colombian government. The company's activities include
exploration for and production of crude oil and natural gas, as
well as refining, transportation, and marketing of crude oil,
natural gas and refined products. Ecopetrol is Latin America's
fourth-largest integrated-oil concern. Operations are organized
into Exploration & Production, Refining & Marketing,
Transportation, and International Commerce & Gas.
On June 27, 2006, Fitch Ratings revised the rating outlook of
the long-term foreign currency issuer default rating of
Ecopetrol SA to Positive from Stable. This rating action
follows the recent revision in the Rating Outlook to Positive
from Stable of the 'BB' foreign currency IDR of the Republic of
Colombia. Ecopetrol's IDR remain strongly linked with the
credit profile of the Republic of Colombia.
* COLOMBIA: Auctioning Acerias Paz's 52% Stake on March 16
----------------------------------------------------------
A group of shareholders of Colombia's second-largest steel
maker, Acerias Paz del Rio SA, will auction a controlling stake
on March 16, the local securities regulator said.
The Colombian government, which owns 9.14% of Paz del Rio, and a
group of other shareholders will sell a combined 52% stake in
the steel maker for a minimum of about COP425.9 billion, or
US$192 million, said securities regulator Superintendencia
Financiera, citing Latinvestco, the local investment bank
handling the sale.
The different shareholders set a minimum price for the stake at
COP52 (2.34 U.S. cents) for each share and the company will
offer 8.206 billion shares.
The auction will be carried out at the Colombian Stock Exchange
in Bogota.
Minority shareholders will be able to "tag along," or sell their
shares during the auction for as much as the equivalent of 20%
of the shares sold, or 10.4% of the company, said Miguel Reyna,
who handles the sale with Latinvestco.
Reyna said the winning bidder may end up controlling 62.4% of
the company, if minority shareholders all "tag along."
The remaining shares trading on the market would be 17.6% as the
government of the Boyaca province holds the remaining 20%.
The auction will be open to anyone. Participants will have to
raise their bids by 5% from the last price offered, Reyna added.
To further boost its stake in Paz del Rio, the winner will have
to carry out a public tender offer, Reyna said.
So far six companies have consulted the company's financial
information, Reyna said, though he declined to identify them.
To be able to bid, any steel company needs the approval of the
local anti-trust agency or a letter showing it doesn't have a
direct or indirect presence in the country.
The Colombian anti-trust regulator authorized international
steel group Arcelor-Mittal and Brazilian closely held industrial
group Votorantim to bid for Paz del Rio.
Brazil's largest steel maker, Gerdau SA, will also be able to
bid for Paz del Rio, providing it sells some of its Colombian
assets. Gerdau is currently the biggest steel maker in Colombia.
Brazilian integrated steelmaker Companhia Siderurgica Nacional,
or CSN, also said it may bid for the Colombian steel maker.
Acerias has an installed capacity of 370,000 metric tons of
crude steel at its blast furnace and an additional 70,000 metric
tons of crude steel through an electric arc furnace. The company
also owns a metallurgic coal mine.
Thanks to a recovery of steel prices and a solid economic growth
in Colombia, Acerias is recovering from a bankruptcy process and
its net income will probably rise 50% in 2006 to COP90 billion
Colombian pesos.
* * *
On July 25, 2006, Fitch rated the Republic of Colombia's US$1
billion issue of fixed-rate Global Bonds maturing Jan. 27, 2017,
BB. The rating is in line with Fitch's long-term foreign
currency rating on Colombia. Fitch said the rating outlook is
positive.
===================
C O S T A R I C A
===================
GENERAL NUTRITION: Launches US$365 Million Cash Tender Offering
---------------------------------------------------------------
General Nutrition Center Inc. has commenced cash tender offers
to purchase any and all of each of its outstanding 8-5/8% Senior
Notes due 2011 and 8-1/2% Senior Subordinated Notes due 2010.
The aggregate principal amount of the outstanding Centers Senior
Notes is US$150,000,000, and the aggregate principal amount of
the outstanding Centers Senior Sub Notes is US$215,000,000.
In conjunction with these tender offers, General Nutrition
Centers is soliciting noteholder consents to effect certain
amendments to the indentures governing the respective General
Nutrition Centers Notes similar to those sought by Parent in
connection with the GNC Parent Notes.
In addition, GNC Parent Corporation, the parent company of
General Nutrition, has commenced a cash tender offer to purchase
any and all of its outstanding Floating Rate Senior PIK Notes
due 2011. The aggregate principal amount at maturity of the
outstanding GNC Parent Notes is US$425,000,000.
In conjunction with the tender offer, the GNC Parent is
soliciting noteholder consents to effect certain amendments to
the indenture governing the Notes to eliminate substantially all
of the restrictive covenants as well as certain events of
default.
The tender offers for each of the GNC Parent Notes and the
General Nutrition Centers Notes are scheduled to expire at 12:00
midnight, New York City time, on March 15, 2007, unless extended
or earlier terminated.
Holders of each of the Notes who tender on or before 5:00 p.m.,
New York City time, on March 1, 2007, will receive the total
consideration described above in connection with the respective
Notes; holders of the General Nutrition Centers Notes will
receive a US$30 consent payment per US$1,000 principal amount of
Notes. Holders of the General Nutrition Centers Notes who
tender after the Consent Payment Deadline and on or prior to the
Expiration Date will receive the total consideration minus the
US$30 consent payment.
In either case, holders whose Notes are validly tendered and
accepted for purchase will be paid accrued and unpaid interest
up to, but not including, the payment date. Payments are
expected to be made promptly on or after the Expiration Date.
The GNC Parent said that it has retained J.P. Morgan Securities
Inc. and Goldman, Sachs & Co. to serve as the Dealer Managers
for each of the tender offers and Solicitation Agents for each
of the consent solicitations.
General Nutrition Centers, Inc. -- http://www.gnc.com/-- with
headquarters in Pittsburgh, Pennsylvania, retails and
manufactures vitamins, minerals, and nutritional supplements
domestically and internationally through about 5850 company-
operated and franchised stores. Revenue for the twelve months
ended September 2006 approached US$1.5 billion. General
Nutrition's Latin American operations are in the Bahamas, Cayman
Islands, Chile, Colombia, Costa Rica, among others.
* * *
As reported in the Troubled Company Reporter-Latin America on
March 2, 2007, Moody's Investors Service assigned these ratings:
-- US$710 million senior secured credit facility at B1
(LGD 2, 27%);
-- US$300 million floating-rate seven-year senior notes
at Caa1 (LGD 5, 77%);
-- US$125 million fixed-rate eight-year senior subordinated
notes at Caa2 (LGD 6, 95%);
-- Corporate family rating at B3;
-- Probability-of-default rating at B3;
-- Speculative Grade Liquidity rating at SGL-3.
* COSTA RICA: May Have to Review Treaty Process Amendment
---------------------------------------------------------
The Sala IV constitutional court of Costa Rica may send back the
proposed change in the procedures for the nation's free trade
pact with the United States to the Asamblea Legislativa's
Comision de Asuntos Internacionales for review, A.M. Costa Rica
reports.
A.M. Costa Rica relates that the Asamblea Legislativa had
ratified the amendment to speed up the approval of the free
trade agreement. The measure allows the assembly leadership to
implement a fixed period of up to 28 sessions for discussing the
free trade pact.
However, an appeal that opponents of the treaty filed before the
court, alleging that their rights were trampled by the way the
process took place, A.M. Costa Rica notes.
The court magistrates agreed that the opponents didn't get a
fair participation in the discussion as well as in proposing
amendments before the Comision de Asuntos. They will decide
this week on whether the amendment will be sent back to the
commission, A.M. Costa Rica states.
* * *
As reported on Aug. 21, 2006, Fitch Ratings upgraded Costa
Rica's country ceiling to BB+ from BB.
===================================
D O M I N I C A N R E P U B L I C
===================================
BANCO INTERCONTINENTAL: Audit on Bank Reveals Incomplete Probe
--------------------------------------------------------------
The audit of BDO Ortega & Asociados on Banco Intercontinental
reveals that investigation on the latter was incomplete and
without conclusion due to the lack of documents provided by the
authorities, Dominican Today reports.
However, the legal representatives of former Banco
Intercontinental president Ramon Baez Figueroa alleged that
those responsible for the plundering and theft of the bank's
assets, enjoyed impunity in the administration, Dominican Today
notes.
Dominican Today underscores that Mr. Figueroa's defense is
headed by:
-- Marino Vinicio Castillo, and
-- Juarez Castillo.
Listin Diario relates that the defense team thought that the
auditors' report confirmed the central bank's wanting to hide
the plundering during Banco Intercontinental's liquidation of
assets and loan portfolio.
Members of the defense team told Dominican Today, "Our appeal
for protection has been successful because after a two and a
half year delay, the people in charge of the forensic audit that
the Central Bank refused to provide, say that the required
information and documentation were not provided for us to reach
conclusions on the responsibility of those who eliminated tens
of billions of pesos at their whim."
The defense council's denunciation that a mafia has operated
with total impunity is confirmed. While the criminal activity
of concealment is conduct in plain sight, the monetary and
financial authority demands from Mr. Figueroa a civil
indemnification for supposed losses, whose real responsibility
is of those who stole the assets of Banco Intercontinental and
who have enjoyed total impunity in the present administration,
Mr. Figueroa's lawyers said in a press release.
Marino Vinicio Castillo can be reached at:
Fuerza Nacional Progresista
Presidente
Consejo Nacional de Drogas
Oficinas Gubernamentales, Bloque C
Avenida Mexico esq. 30 de Marzo
Tel. 809-2221-4747
809-221-5166
Email: of.pcastillo@codetel.net.do
Banco Intercontinental aka Baninter collapsed in 2003 as a
result of a massive fraud that drained it of about US$657
million in funds. As a consequence, all of its branches were
closed. The bank's current and savings accounts holders were
transferred to the bank's new owner -- Scotiabank. The
bankruptcy of Baninter was considered the largest in world
history, in relation to the Dominican Republic's Gross Domestic
Product. It cost Dominican taxpayers DOP55 billion and resulted
to the country's worst economic crisis.
FLOWSERVE CORP: Board Resumes Quarterly Cash Dividend Payments
--------------------------------------------------------------
Flowserve Corp. announced that its board of directors has
authorized the payment of a quarterly cash dividend of 15 cents
per share on the company's outstanding shares of common stock.
The dividend is payable on April 11, 2007, to shareholders of
record as of the close of business on March 28, 2007. This will
be Flowserve's first quarterly dividend paid since December
1999, because the company suspended dividends in early 2000 as
part of a major acquisition financing.
"The resumption of a regular quarterly cash dividend, combined
with our stock repurchase program announced in 2006,
demonstrates our optimism in Flowserve's future as well as
confidence in our ability to continue generating strong cash
flows," said Flowserve President and Chief Executive Officer
Lewis M. Kling. "It also provides us with this opportunity to
enhance shareholder value without curtailing our ability to
strengthen the company through organic growth initiatives or
balance sheet improvements."
While Flowserve currently intends to pay regular quarterly
dividends for the foreseeable future, any future dividends will
be reviewed individually and declared by the board at its
discretion dependent on the board's assessment of the company's
financial condition and business outlook at the applicable time.
Headquartered in Irving, Texas, Flowserve Corp. (NYSE: FLS) --
http://www.flowserve.com/-- provides fluid motion and control
products and services. Operating in 56 countries, the company
produces engineered and industrial pumps, seals and valves as
well as a range of related flow management services. In Latin
America, Flowserve operates in 36 countries such as the
Dominican Republic, Guatemala, Guyana and Belize.
* * *
As reported in the Troubled Company Reporter-Latin America on
Feb. 13, 2007, Fitch Ratings has initiated coverage of Flowserve
Corp. and assigned these ratings:
-- Issuer Default Rating (IDR) 'BB'; and
-- Senior secured bank facilities 'BB'.
Fitch said the rating outlook is stable.
FLOWSERVE CORP: Reports Record Annual Sales of US$3.1 Billion
-------------------------------------------------------------
Flowserve Corp. timely filed its 2006 Annual Form 10-K report
with the U.S. Securities and Exchange Commission and reported
significantly stronger financial results for 2006. The
company's announcement highlights record annual sales of US$3.1
billion, record annual income from continuing operations of
US$114 million, a determination of no material weaknesses in
internal controls at Dec. 31, 2006, and a positive outlook for
2007. Also, as announced earlier today, the company has
declared a US$0.15 per share quarterly dividend, payable on
April 11, 2007, to shareholders of record as of the close of
business on March 28, 2007.
Highlights:
Full Year 2006 (All comparisons versus 2005)
* At Dec. 31, 2006, there were no material weaknesses in
internal controls over financial reporting
* Record Bookings from continuing operations of US$3.6
billion, up 23.4%
* Record Backlog of US$1.6 billion, up 64%
* Record Sales of US$3.1 billion, up 13.6%
* Gross Profit of US$1.0 billion, up 15.7%
* Gross Margin improvement of 60 basis points to 32.9%
* Operating Income of US$240 million, up 20.5%, including
realignment charges of US$13 million
* Fully diluted EPS from continuing operations of US$2.00,
up US$1.09 or 120%
* Strong operating cash flow facilitated funding of US$101
million repayment of debt and other financing obligations,
US$36 million of optional U.S. pension contributions and
the repurchase of 1.3 million shares (US$63 million) in
4th quarter 2006 of an approved 2 million share buyback
* Net debt-to-capital ratio improved to 32.6% from 40.0%
* Converted U.S. inventories from LIFO to FIFO. All
financial information in this release has been adjusted to
reflect this change in accounting for inventory
Fourth Quarter-2006 (All comparisons versus fourth quarter of
2005)
* Record Bookings from continuing operations of
US$934 million, up 20.9%
* Record Sales of US$884 million, up 19.6%
* Gross Profit of US$287 million, up 19.1%
* Gross Margin down 10 basis points to 32.5%, primarily due
to a higher mix of major project business versus
aftermarket business in the Pump division
* Operating Income of US$63 million, up 10.2%, including
realignment charges of US$12 million
* Fully diluted EPS from continuing operations of US$0.58,
up US$0.18 or 45%
2006 Form 10-K Filed
Flowserve timely filed its 2006 Form 10-K with the SEC today.
"Remaining a current filer has been a core objective at
Flowserve," said Flowserve President and CEO Lewis M. Kling.
"We are very pleased to have come through on our commitments to
file timely and to eliminate material weaknesses in internal
controls at Dec. 31, 2006, while delivering strong and
significantly improved financial performance."
Discussion and Analysis of Full Year 2006
(Comparisons to 2005)
Bookings from continuing operations for the full year 2006
increased by 23.4% to US$3.6 billion, a company record. The
increase was driven by strength in oil and gas, power and water
markets, especially in North America, China and the Middle East.
Backlog at Dec. 31, 2006, increased 64.0% to US$1.6 billion, as
the result of robust bookings, and this improvement positions
the company for a considerably stronger 2007.
Sales for the full year 2006 increased by 13.6% to US$3.1
billion, also a company record. The strong sales growth
reflects brisk demand in the oil and gas, power and water
industries.
Gross Profit for the full year 2006 increased by 15.7% to US$1.0
billion. Gross Margin for the full year 2006 increased by 60
basis points to 32.9%. This margin improvement was largely due
to increased sales (which favorably impacted absorption of fixed
costs), pricing increases and more selectivity in accepting
customer orders, plus successful supply chain and Continuous
Improvement Process initiatives.
SG&A for the full year 2006 increased by 14.4% to US$783
million. This increase reflects higher commissions from the
record bookings, additional sales and engineering personnel in
support of the robust sales levels, continued development of in-
house compliance capabilities and costs associated with
expansion in Asia, as well as increased legal fees and expenses.
Costs of equity compensation increased as a result of the
adoption of FAS 123R for stock options and the increased share
price for restricted stock. SG&A in 2006 also includes
realignment charges of US$13 million related to relocation of
product lines and severance of redundant personnel in certain
locations, compared with approximately US$2 million in 2005.
SG&A also includes US$6 million in stock modification charges
versus US$7 million in 2005.
Income from continuing operations for the full year 2006
increased by 122% to US$114 million, a company record. In 2006,
the company benefited from a reduction of US$13 million in net
interest costs, US$8 million in foreign currency gains in 2006
versus US$7 million of foreign currency losses in 2005 and the
absence of the debt extinguishment charges of US$28 million
incurred in 2005 from the company's successful US$1 billion
refinancing at lower rates. In addition, the tax rate in 2006
was 39.1%, compared to 44.1% in 2005.
Fully diluted EPS from continuing operations for the full year
2006 was US$2.00 per share. EPS as reported includes a US$0.15
per share impact related to the previously noted realignment
charges of US$13 million, related primarily to product line
relocation and severance.
Cash flow from operations remained strong in 2006, enabling the
repayment of US$101 million in debt, repurchase of 1.3 million
shares of common stock for US$63 million, pension plan
contributions of US$46 million globally and capital expenditures
of US$74 million to improve operational capabilities.
Flowserve also continued to expand in its core markets both
globally and by market segment in 2006. Oil and gas and power
markets continued to fuel the greatest segment growth, with the
Middle East and Asia Pacific regions leading the way
geographically. "We see robust opportunities in the Middle East
and Asia Pacific regions, and we continued to build the
infrastructure to capitalize on these opportunities during
2006", said Mr. Kling. "The development of our new plants in
China and India plus our work to build a major aftermarket
training, repair and service center for our products in Saudi
Arabia are two key examples of how we are positioning the
company to succeed in these markets," Mr. Kling went on to say.
Discussion and Analysis of 4th Quarter
(Comparisons to 4th quarter 2005)
Consolidated bookings from continuing operations for the 4th
quarter of 2006 continued to grow at a strong pace, up 20.9% to
US$934 million. Sales growth increased by 19.6% to US$884
million. "I am very pleased with the company's performance for
the year and for the 4th quarter in particular," said Mr. Kling.
"To achieve this level of bookings and sales in the fourth
quarter is a testament to our management team's solid execution
and an indication of our bright prospects for the future."
Gross Profit for the 4th quarter of 2006 increased by 19.1% to
US$287 million, whereas Gross Margin declined by 10 basis points
to 32.5%. A shift in sales mix to higher levels of large, more
complex project business in the Pump Division contributed to the
slight decline, partially offset by realization of margin
improvements in the Flow Control Division. Kling noted "We are
pleased by the increase in project business which builds our
installed base and attractive aftermarket opportunities."
Selling, General and Administrative expense (SG&A) for the 4th
quarter of 2006 increased by 21.5% to US$227 million, including
US$12 million of realignment charges associated with relocation
of product lines and severance of redundant personnel in certain
locations, compared with approximately US$2 million in 2005.
The increase was also driven by increased headcount in support
of the higher sales and bookings levels, plus related travel and
incentive compensation expense, as well as higher legal fees and
expenses. "We have initiatives underway to reduce SG&A costs
while ensuring that we still properly support the growth in our
business," said Flowserve CFO Mark A. Blinn.
Income from continuing operations for the 4th quarter was US$33
million, an increase of US$11 million or 50%, due primarily to
higher sales, improved pricing and successful operational
excellence initiatives.
Fully diluted earnings per share or EPS from continuing
operations for the 4th quarter was US$0.58, reflecting the
increase in income described above, up US$.18 or 45%. EPS as
reported includes a US$0.12 per share impact related to the
realignment charges previously described.
Flowserve Pump Division or FPD
Bookings for the 4th quarter of 2006 increased 29.2% to US$565
million. Bookings for the full year 2006 increased 34.0% to
US$2.1 billion. Bookings of original equipment, as a percent of
total bookings, increased to 61.5% in the 4th quarter of 2006
from 58.7% in the 4th quarter of 2005. Bookings of original
equipment for the full year 2006, as a percent of total
bookings, increased to 62% from 57% in 2005, due primarily to an
increase in large project business. 2006 original equipment
bookings grew 46%, aftermarket bookings grew 18% versus 2005.
This type of project success provides FPD with increased
aftermarket opportunity in the future, which has historically
been more profitable than original equipment. The bookings
increase is attributable to strength in the oil and gas, power,
and water industries.
Sales for the 4th quarter of 2006 increased 24.3% to US$501
million. Sales for the full year 2006 increased by 15.7% to
US$1.6 billion, following an extended period of pump bookings
growth. Original equipment sales, as a percent of total sales,
increased to 58% in the 4th quarter of 2006 from 53% in the 4th
quarter of 2005.
Full year original equipment increased as a percent of total
sales to 57% from 53% in 2005, principally driven by oil and gas
sales in the Middle East and North America.
Gross margin for the 4th quarter of 2006 decreased 210 basis
points to 28.8% reflecting a higher proportion of project-
related shipments, which are historically more competitively bid
than aftermarket business. Gross Margin for the full year 2006
of 28.3% remained flat. Benefits from improved absorption of
fixed costs, as well as process efficiency and supply chain
initiatives, were offset by aforementioned shift in sales mix to
original equipment, which historically carries a lower margin.
For the year ended 2006, original equipment sales increased 23%
and aftermarket sales increased by 8% versus the same period in
2005.
Operating Income for the 4th quarter of 2006 decreased by 6.3%
to US$59 million. The decrease is attributable to the higher
proportion of original equipment sales, plus increased SG&A
resulting from sales and engineering headcount, sales incentive
compensation, third party commissions and travel expenses in
support of increased bookings and sales. Operating Income for
the 4th quarter of 2006 also includes a US$5 million realignment
charge for severance associated with the reduction of redundant
personnel in Europe. Operating Income for the full year 2006
increased by 15.3% to US$173 million. The increase in Gross
Profit of US$62 million was partially offset by increased
commission and travel expense, costs related to increased stock
compensation and higher information technology project costs.
Flow Control Division or FCD
Bookings from continuing operations for the 4th quarter of 2006
increased 7.7% to US$255 million. Bookings from continuing
operations for the full year 2006 increased by 13.3% to US$1.1
billion. The increase is primarily attributable to continued
strengthening of several key end-markets. Continued strength in
the process valve market resulted from growth in the Asian
chemical and coal gasification industries, as well as broad
strength in the North American and Middle Eastern oil and gas
markets.
Sales for the 4th quarter of 2006 increased by 15.4% to US$267
million. Sales for the full year 2006 increased by 11.2% to
US$995 million. The increase is primarily attributable to the
same reasons as the FCD bookings growth.
Gross Margin for the 4th quarter of 2006 increased 260 basis
points to 33.1%. The increase in Gross Profit of US$18 million
and related margin are due to the increase in sales, which
favorably impacted FCD's recovery of fixed manufacturing costs,
FCD's progress in attaining margin improvements and a large
specific warranty charge in 2005. Gross Margin for the full
year 2006 increased 180 basis points to 34.0% in 2006. The
increase was primarily driven by increased sales, coupled with
improved pricing, through an implementation of broad-based price
increases in the latter-half of 2005.
Operating Income for the 4th quarter of 2006 increased 35.8% to
US$26 million. The 4th quarter improvement in gross profit was
partially offset by higher SG&A costs, driven by US$5 million of
realignment charges associated with the relocation of product
lines to different facilities, US$4 million of selling costs due
to the increase in sales and bookings and other costs associated
with increased headcount needed to support higher business
levels. Operating Income for full year 2006 increased by 25.8%
to US$116 million. The increase is primarily driven by the
improvement in Gross Profit of US$51 million, partially offset
by higher SG&A. For 2006, approximately US$7 million of
realignment charges were recognized in SG&A associated with the
relocation of product lines to different facilities and US$9
million of higher selling costs.
Flow Solutions Division or FSD
Bookings for the 4th quarter of 2006 increased by 16.7% to
US$129 million. Bookings for the full year 2006 increased by
9.0% to US$505 million. The increase in bookings is due to
strong project and original equipment growth as well as robust
end-user markets. Success in the end-user market continues to
be a strength based on the FSD business model, which places a
premium on servicing customers locally through an increasingly
larger network of Quick Response Centers or QRCs.
Sales for the 4th quarter of 2006 increased by 12.8% to US$131
million and sales for full year 2006 increased by 11.9% to
US$497 million, both driven by aftermarket and original
equipment sales growth in the oil and gas, chemical, and mineral
and ore processing industries.
Gross Margin for the 4th quarter of 2006 decreased 150 basis
points to 42.0% on higher sales compared with the 4th quarter of
2005. This change reflects higher project shipments in the 4th
quarter. Gross Margin for the full year 2006 increased 20 basis
points to 44.1%, as a result of various operational excellence
initiatives, implementation of price increases and strong
aftermarket growth.
Operating Income for the 4th quarter increased 3.9% to US$22
million. 4th quarter of 2005 included approximately US$2
million of severance costs. Operating Income for the full year
2006 increased 12.6% to US$99 million. The positive impact of
FSD's global capacity expansion due to the growing QRC network
contributed to the increase.
Internal Controls Update
During 2006, the company remediated all the material weaknesses
reported at Dec. 31, 2005. "We have come a long way in our
effort to improve our internal controls as proven by our
achievement of no material weaknesses. In 2007, we still plan
to continue to improve our control environment while also
continuing to reduce the costs of this work," said Mr. Blinn.
LIFO to FIFO
In the 4th quarter of 2006, the company completed its change in
accounting for U.S. inventory from LIFO to FIFO. The change
increased net earnings for the years ended Dec. 31, 2006 and
2005, by US$6.0 million and US$5.2 million, respectively. It
also increased both total assets and total shareholders' equity
at Dec. 31, 2005, by US$21.6 million. All prior period
financial information included herein has been retrospectively
adjusted to reflect this change.
2007 Outlook
Mr. Kling expressed a positive outlook for 2007. He said, "We
believe that we are taking market share. And, we continue to
see record levels of bookings based on the strength of our
products, our global operational capabilities, the talent of our
global sales team and the continued strength of our markets."
Mr. Kling added, "We expect our 2007 sales to grow double digits
in percentage to a range of US$3.4 billion to US$3.6 billion.
We also see further improvement in our gross margins of 25 to 50
basis points since our operational excellence initiatives should
gain further traction."
Mr. Blinn added that, "Our SG&A has increased in the past couple
of years as we have incurred higher costs to complete our
restatement and to further develop in-house capabilities.
Further, we have added additional sales resources and engineers
to support our business growth. However, we now believe that we
have stabilized our cost structure and are well-positioned to
realize reduction opportunities. These opportunities include
volume leverage, reduced travel, headcount management and
operational excellence programs executed at both the corporate
and divisional levels. Bottom line, we expect a 175 to 250
basis point improvement in SG&A as a percentage of sales in
2007."
Summary
Mr. Kling concluded that, "We are extremely pleased with the
performance of the company during 2006 and believe that the
company has the momentum to significantly improve this
performance going forward. Our record backlog, successful
operational excellence initiatives and robust market
opportunities all bode quite well for 2007."
Headquartered in Irving, Texas, Flowserve Corp. (NYSE: FLS) --
http://www.flowserve.com/-- provides fluid motion and control
products and services. Operating in 56 countries, the company
produces engineered and industrial pumps, seals and valves as
well as a range of related flow management services. In Latin
America, Flowserve operates in 36 countries such as the
Dominican Republic, Guatemala, Guyana and Belize.
* * *
As reported in the Troubled Company Reporter-Latin America on
Feb. 13, 2007, Fitch Ratings has initiated coverage of Flowserve
Corp. and assigned these ratings:
-- Issuer Default Rating (IDR) 'BB'; and
-- Senior secured bank facilities 'BB'.
Fitch said the rating outlook is stable.
JETBLUE AIRWAYS: Launches Nonstop Service in Dominican Republic
---------------------------------------------------------------
JetBlue Airways reported a major expansion of service to its
customers' favorite island destinations with the launch of
nonstop service this spring between Santo Domingo, Dominican
Republic and New York's John F. Kennedy International Airport,
as well as the launch of new nonstop service between Boston and
Bermuda and between Orlando and Ponce, Puerto Rico. Bermuda
flights begin May 1 while Santo Domingo and Ponce flights begin
May 24.
JetBlue Airways will also add additional daily flights for the
peak summer season on existing routes:
-- New York/JFK and Aruba;
-- New York/JFK and Santiago, Dominican Republic; and
-- Orlando and San Juan, Puerto Rico.
JetBlue Airways will offer this summer more flights to the
Caribbean/Atlantic region than any other low-fare airline, with
nearly 200 weekly flights from Boston, New York/JFK and Orlando.
JetBlue Airways will launch service to Santo Domingo with two
daily flights from New York/JFK beginning May 24. Flights will
be operated with 150-seat Airbus A320 aircraft, featuring
industry-leading legroom and a complimentary selection of first-
run movies and bonus features from FOX InFlight. Santo Domingo
will be JetBlue Airways' 53rd destination, and its 9th city in
the Caribbean/Atlantic region. To celebrate its new service to
Las Americas International Airport, JetBlue Airways is offering
introductory one-way fares between New York and Santo Domingo
starting at US$109 each way. The airline previously served
Santo Domingo from 2004 to 2005.
"Que mucho te extranyamos, Santo Domingo! We're thrilled to be
returning to your beautiful city this spring," said JetBlue
Airways Founder and Chief Executive Officer David Neeleman.
"The Dominican community has been one of our biggest supporters
since we started service to the island in 2004. We brought low
fares and great service, and they gave us their loyalty. This
is our way of saying 'thanks'."
JetBlue Airways currently serves the Dominican Republic with
daily service to Santiago from New York/JFK. The low-fare
airline will add a second daily flight on the JFK-Santiago route
between July 1 and Oct. 31.
JetBlue Airways will introduce new low-fare service between
Boston and Bermuda for the peak summer season between May 1 and
Oct. 31. Flights will be operated with JetBlue Airways'
spacious 100-seat EMBRAER 190 jets with fares starting as low as
US$99 each way. JetBlue Airways currently operates daily
service between Bermuda and New York/JFK and is the only low-
fare airline offering scheduled service to the island.
"At Boston Logan we couldn't be happier to add JetBlue to our
family of airlines offering international service and we look
forward to working with them as they continue to grow at Logan,"
said Massport's Chief Executive Officer and Executive Director
Thomas J. Kinton, Jr. "Bermuda has always been a popular
vacation destination and JetBlue is sure to bring to that route
their brand of quality service that we have all come to expect
and to enjoy."
JetBlue Airways will continue to strengthen its position in
central Florida this spring with the launch of new daily nonstop
service from Orlando International Airport to Mercedita Airport
in Ponce, Puerto Rico, beginning May 24. Flights will operate
daily through Sept. 3 with fares starting at US$79 each way. In
addition, JetBlue Airways will add a third daily nonstop flight
between Orlando and San Juan for the summer season. JetBlue
Airways offers more service to more Puerto Rican destinations
from Orlando -- Aguadilla, Ponce, and San Juan -- than any other
airline.
JetBlue Airways also offers convenient connections to the region
from dozens of destinations across the low-fare carrier's US
network including:
-- Buffalo and Rochester, New York;
-- Burlington, Vermont;
-- Portland, Maine;
-- Washington, DC/Dulles;
-- Pittsburgh, Pennsylvania;
-- Charlotte and Raleigh/Durham, North Carolina;
-- Chicago, Illinois/O'Hare;
-- Denver, Colorado; and
-- Burbank and San Francisco, California.
Customers enrolled in JetBlue Airways' customer loyalty program,
TrueBlue, will earn:
-- four TrueBlue points each way for nonstop flights
between Orlando and Puerto Rico;
-- four points each way for nonstop flights between
Boston and Bermuda; and
-- six points each way for flights between New York
and the Dominican Republic.
Double TrueBlue points are awarded for travel purchased online
at http://www.jetblue.com/ Customers can earn TrueBlue points
even faster by using the JetBlue Card from American Express.
Every time cardholders purchase JetBlue Airways travel with the
Card, or earn at least one TrueBlue point through other
purchasing using the Card, all TrueBlue points in the member's
account automatically extend for another 12 months.
Based in Forest Hills, New York, JetBlue Airways Corp.
(Nasdaq:JBLU) -- http://www.jetblue.com/-- provides passenger
air transportation services primarily in the United States. As
of Feb. 14, 2006, the Company operated approximately 369 daily
flights serving 34 destinations in 15 states, Puerto Rico, the
Dominican Republic, and the Bahamas. The Company also provides
in-flight entertainment systems for commercial aircraft,
including live in-seat satellite television, digital satellite
radio, wireless aircraft data link service, and cabin
surveillance systems and Internet services, through its wholly
owned subsidiary, LiveTV, LLC.
* * *
As reported in the Troubled Company Reporter on Nov. 23, 2006,
Moody's Investors Service assigned ratings of Caa1 (LGD5, 88%)
to the approximately US$40 million of Special Facility Revenue
Bonds, Series 2006 (JetBlue Airways Corporation Project or the
JFK Facility Bonds) to be issued by the New York City Industrial
Development Agency. Moody's affirmed the B2 corporate family
rating for JetBlue Airways Corp. Moody's said the outlook
remains negative.
Standard & Poor's Ratings Services assigned its 'B' rating to
US$40 million of New York City Industrial Development Agency
special facility revenue bonds, series 2006 maturing on
May 15, 2021, and May 15, 2030; the amount for each maturity
have yet to be determined. The bonds, which will be used to
finance a hangar and other facilities, will be serviced by
payments made by JetBlue Airways Corp. (B/Stable/B-3) under a
lease between the airline and the agency.
=====================
E L S A L V A D O R
=====================
ALCATEL-LUCENT: Inks Network Deal with Advocate Health Care
-----------------------------------------------------------
Alcatel-Lucent disclosed that Oak Brook has deployed Alcatel-
Lucent OmniTouch My Teamwork(TM) as part of a services
transformation that will help empower its staff -- both
administrative and clinical -- to be more productive through
real-time communication. The full rollout will provide up to
14,000 of Advocate's employees with real-time, multimedia
conferencing and collaboration capabilities.
With eight hospitals, over 200 sites offering acute care,
outpatient services, home health care, counseling, day care,
physician services, skilled nursing care and health care
education, and 24,500 employees, Advocate is ranked as one of
the top 10 most integrated health care networks in the United
States. Like many organizations of its size, Advocate strives
to improve the communications capabilities of its large and
growing employee base, which includes on-site administrative and
mobile clinical staff, as well as remote medical personnel. In
order to decrease travel costs, and to reduce the amount of time
spent in meetings, Advocate deployed the Alcatel-Lucent web
conferencing solution, enabling dispersed teams and cross-
functional personnel to hold effective, virtual meetings on an
as needed basis.
Through the implementation of OmniTouch My Teamwork's real-time
collaboration capabilities, Advocate is successfully
transforming the organization's culture to a model that employs
ad-hoc communication as a means for addressing issues as they
occur.
"Advocate's need for intra-departmental collaboration is the
norm within health care settings, but we set out to turn around
the traditional, less-productive culture it creates through the
use of OmniTouch My Teamwork," said Gary Horn, director network
architecture at Advocate Health Care.
"Alcatel-Lucent's OmniTouch My Teamwork is already enabling our
employees to cut travel time to and from meetings, resulting in
greater productivity and ultimately, better patient care," Mr.
Horn added. "We can foresee hard dollar savings across the
board with the use of OmniTouch My Teamwork."
While Mr. Horn also considered other leading service provider
solutions, he noted "they did not include presence-based IM for
spontaneous collaboration and represented an ongoing cost versus
a fixed capital expenditure."
OmniTouch My Teamwork currently supports 2,250 users including
the Information Systems, Human Resources, and Home Health
divisions, and hosts 30-40 collaboration sessions daily without
any staff members needing to travel.
With OmniTouch My Teamwork accessible to the select functional
areas across the organization, Advocate envisions a borderless
hospital. Physicians can review and discuss images and test
results from remote locations, enabling collaboration on patient
cases. Telemedicine consulting supports a "networked practice"
approach where staff can efficiently diagnose, treat patients,
and avoid medical errors with the help of virtual meeting rooms
and presence-based instant messaging.
"As an organization always striving to provide the highest
levels of patient care, Advocate saw an opportunity to transform
the way employees work with one another, which would in turn
make them an even more effective organization," Hubert de
Pesquidoux, President of Alcatel-Lucent enterprise activities,
said. "Organizations like Advocate who are leading the way into
a new era by embracing new technologies and tools that allow
them to remove the barriers to effective collaboration and true
business transformation."
Alcatel-Lucent is dedicated to transforming traditional
communications and business processes in the health care
industry to deliver new services and applications as
demonstrated with Advocate Health Care and more recently the
large network transformation win with the University of
Pittsburg Medical Center.
About Alcatel-Lucent
Headquartered in Paris, France, Alcatel-Lucent
-- http://www.alcatel-lucent.com/-- provides solutions that
enable service providers, enterprises and governments worldwide,
to deliver voice, data and video communication services to end
users. Through its operations in fixed, mobile and converged
broadband networking, Internet protocol (IP) technologies,
applications, and services, Alcatel-Lucent offers the end-to-end
solutions that enable communications services for people at
home, at work and on the move.
On Nov. 30, 2006, Alcatel and Lucent Technologies Inc. completed
their merger transaction, and began operations as a
communication solutions provider under the name Alcatel-Lucent
on Dec. 1, 2006.
Alcatel-Lucent maintains operations in 130 countries, including,
Austria, Germany, Hungary, Italy, Netherlands, Ireland, Canada,
United States, Costa Rica, Dominican Republic, El Salvador,
Guatemala, Peru, Venezuela, Australia, Brunei and Cambodia.
* * *
As of Feb. 7, Alcatel-Lucent's Long-Term Corporate Credit rating
and Senior Unsecured Debt carry Standard & Poor's BB- rating.
It's Short-Term Corporate Credit rating stands at B.
Moody's, on the other hand, put a Ba2 rating on Alcatel's
Corporate Family and Senior Debt rating. Lucent carries Moody's
B1 Senior Debt rating and B2 Subordinated debt & trust preferred
rating.
Fitch rates Alcatel's Issuer Default Rating and Senior Unsecured
Debt rating at BB.
ALCATEL-LUCENT: Inks Network Outsourcing Deal with E-Plus
---------------------------------------------------------
Alcatel-Lucent will be managing several network business
divisions of Germany's third-largest mobile communications
provider, E-Plus Mobilfunk GmbH & Co. KG.
Under the terms of the network outsourcing agreement, E-Plus
Mobilfunk will transfer the operational business divisions
responsible for the operation, maintenance and deployment of its
cellular network to Alcatel-Lucent on March 1, enabling E-Plus
to concentrate on its core business, reduce operational expenses
and increase network quality.
As part of this agreement, about 750 E-Plus employees in
Germany will join Alcatel-Lucent.
E-Plus will maintain responsibility for strategic network
planning and network development, including the selection of
mobile communications locations and their technical equipment to
ensure the long-term quality of its cellular network.
"Our decision to enter a strategic partnership with
Alcatel-Lucent is designed to guarantee our subscribers a
network of a constantly increasing quality over the long term,"
Elmar Grasser, Chief Technical Officer of E-Plus Mobilfunk GmbH
& Co. KG, explained. "Alcatel-Lucent is the world's leading
network integrator with the resources to meet future network
construction and maintenance requirements with greater speed,
flexibility and cost synergies than we could alone. And with
this step, we're once again playing a pioneering role on the
German market."
The outsourcing of several network divisions is part of
E-Plus's strategic reorientation and follows the company's
recently announced restructuring. These measures are intended
to lead to increased customer focus as well as boosting
efficiency, flexibility and effectiveness, thus contributing to
E-Plus' continued profitable growth.
"By outsourcing individual business divisions, we can apply
greater energy to our core business - and that means quality and
especially care for our customers. It will put us in a position
to focus even more attention on the development of simple, cost-
effective mobile communications solutions for clearly defined
customer segments," Mr. Grasser added.
Network operations and managed services is a key focus area for
Alcatel-Lucent's service activities. Alcatel-Lucent manages
more than 50 networks around the world from ten of its Global
Network Operations Centers and IP Transformation Centers.
"We are proud that an innovative, quality-conscious service
provider like E-Plus has entrusted us with the maintenance and
management of its cellular network," John Meyer, President of
Alcatel-Lucent's service activities, said. "We are the world's
leading network integrator, and hosted and network operations is
one of our strengths. We look forward to helping E-Plus meet
the needs of their customers. We also look forward to having
the experienced and talented employees from E-Plus join the
Alcatel-Lucent team, bolstering our ability to serve this
important customer and expanding our expertise and resources."
About E-Plus Mobilfunk
E-Plus Mobilfunk GmbH & Co. KG is the third largest mobile
communications provider in Germany with over 12.7 million
subscribers as of December 2006.
About Alcatel-Lucent
Headquartered in Paris, France, Alcatel-Lucent (Euronext Paris
and NYSE: ALU) -- http://www.alcatel-lucent.com/-- provides
solutions that enable service providers, enterprises and
governments worldwide, to deliver voice, data and video
communication services to end users. Through its operations in
fixed, mobile and converged broadband networking, Internet
protocol (IP) technologies, applications, and services, Alcatel-
Lucent offers the end-to-end solutions that enable
communications services for people at home, at work and on the
move.
On Nov. 30, 2006, Alcatel and Lucent Technologies Inc. completed
their merger transaction, and began operations as a
communication solutions provider under the name Alcatel-Lucent
on Dec. 1, 2006.
* * *
As of Feb. 7, Alcatel-Lucent's Long-Term Corporate Credit rating
and Senior Unsecured Debt carry Standard & Poor's BB- rating.
It's Short-Term Corporate Credit rating stands at B.
Moody's, on the other hand, put a Ba2 rating on Alcatel's
Corporate Family and Senior Debt rating. Lucent carries Moody's
B1 Senior Debt rating and B2 Subordinated debt & trust preferred
rating.
Fitch rates Alcatel's Issuer Default Rating and Senior Unsecured
Debt rating at BB.
* EL SALVADOR: Economy Improves Due to Free Trade
-------------------------------------------------
El Salvadorian President Tony Saca told A.M. Costa Rica that his
country's economy has improved since the Central American Free
Trade Agreement was implemented in 2006.
A.M. Costa Rica relates that before the free trade accord took
effect, El Salvador, torn by civil war in the 1980s, had a
sluggish economy with about 1.2% growth yearly.
Meanwhile, US President George W. Bush called on the US congress
to pass a comprehensive immigration reform bill, A.M. Costa Rica
notes.
President Bush told the press that President Saca reminded him
that the temporary protected status given to Salvadorian
residents in the US expires in September.
The protected status can be given to citizens of certain nations
affected by armed conflict, natural disaster, or other
extraordinary conditions. However, it doesn't result to
permanent residency, A.M. Costa Rica states.
* * *
As reported in the Troubled Company Reporter-Latin America on
Feb. 15, 2007, Fitch Ratings affirmed these ratings on El
Salvador:
-- Foreign and Local Currency Issuer Default Ratings
at 'BB+';
-- Short-term Issuer Default Rating at 'B'; and
-- Country Ceiling at 'BBB-'.
Fitch said the rating outlook was stable.
=============
J A M A I C A
=============
AIR JAMAICA: To Make Deal with Other Carriers for U.S. Entry
------------------------------------------------------------
Air Jamaica President and Chief Executive Officer Mike Conway
told the Jamaica Observer that the airline could make
arrangements with carriers out of Venezuela and other South
American nations to use Kingston as a hub to enter the United
States.
Mr. Conway commented to The Observer, "That's where the industry
is going and nobody is better able to take advantage of it than
Jamaica. Jamaica is at the heart of the region."
Mr. Conway also reiterated to The Observer that the change of
the airline's fleet from A320 to Boeing was part of a loss-
reducing measure. He explained that Boeing planes cost less,
have greater payload and offer a wider range for travel.
Keeping the Airbus fleet had become a problem, as the supply
chain to Air Jamaica has been difficult, The Observer notes,
citing Mr. Conway.
Mr. Conway also told The Observer that increasing fuel cost was
affecting operations. Each increase of one cent in fuel cost
meant an additional cost of US$500,000 per year for Air Jamaica.
Air Jamaica's success depends on collaborative efforts between
carriers within the region, as well as capitalizing on Jamaica's
geographic position, The Observer states, citing Mr. Conway.
Headquartered in Kingston, Jamaica, Air Jamaica --
http://www.airjamaica.com-- was founded in 1969. It flies
passengers and cargo to almost 30 destinations in the Caribbean,
Europe, and North America. Air Jamaica offers vacation packages
through Air Jamaica Vacations. The company closed its intra-
island services unit, Air Jamaica Express, in October 2005. The
Jamaican government assumed full ownership of the airline after
an investor group turned over its 75% stake in late 2004. The
government had owned 25% of the company after it went private in
1994. The Jamaican government does not plan to own Air Jamaica
permanently.
* * *
On July 21, 2006, Standard & Poor's Rating Services assigned B
long-term foreign issuer credit rating on Air Jamaica Ltd.,
which is equal to the long-term foreign currency sovereign
credit rating on Jamaica, is based on the government's
unconditional guarantee of both principal and interest payments.
GOODYEAR TIRE: Revises U.S. Pension, Retiree Benefit Plans
----------------------------------------------------------
The Goodyear Tire & Rubber Company made a series of changes to
its U.S.-based retail and salaried employee pension and retiree
benefit plans aimed at increasing its global competitiveness
while significantly reducing its cost structure.
"These changes allow us to continue to provide the kind of
compensation packages that are competitive and will attract and
retain talented associates," said Kathleen T. Geier, senior vice
president of human resources. "They are also consistent with our
goal of reducing costs in excess of US$1 billion by the end of
2008."
The changes will be phased in over a two-year period, with most
benefit plan changes effective in 2008 and the most significant
pension plan changes in 2009. As a result, Goodyear expects
after-tax savings of US$80 million to US$90 million in 2007,
US$100 million to US$110 million in 2008, and US$80 million to
US$90 million in 2009 and beyond.
The actions are expected to reduce the company's pension
obligation by approximately US$100 million and its obligation
for other post retirement benefits by about US$525 million
assuming interest rates used to value the obligations remain
similar to those used at Dec. 31, 2006.
Goodyear plans to record a one-time after-tax charge of
approximately US$65 million related to these actions in the
first quarter of 2007.
Benefit plan changes effective Jan. 1, 2008, include:
* Increasing the amounts that current and future salaried
retirees contribute toward the cost of their medical
benefits;
* Redesigning retiree medical benefit plans to minimize cost
impact on premiums;
* Closing the company's Medicare supplement plan to new
entrants; and
* Discontinuing company-paid life insurance for salaried
retirees.
The pension changes include:
* Freezing the current salaried defined benefit pension
plans as of Dec. 31, 2008;
* Replacing the defined benefit pension plans with enhanced
401(k) savings accounts with varying levels of company
contributions for current associates beginning Jan. 1,
2009; and
* Introducing company-matching contributions for the
salaried 401(k) savings plan at 50 percent of the first 4
percent of annual pay beginning Jan. 1, 2009.
"The changes that we've made were only made after careful
consideration of alternatives, recognizing that there will be
varying levels of personal impact depending on the circumstances
of each associate and retiree," Ms. Geier said.
According to Ms. Geier, there is a strong movement on the part
of major corporations away from defined benefit pension plans
and toward defined contribution plans. Additionally, the
recently enacted Pension Protection Act is expected to
accelerate the migration away from traditional defined benefit
pensions.
Details of the plan changes will be directly communicated to the
affected salaried associates and retirees over the next several
weeks. Moving forward, Goodyear associates will be able to
access online retirement modeling tools and investment education
sessions to assist with pension and benefit decisions, and to
plan for the impact of these changes.
About The Goodyear Tire & Rubber Company
Headquartered in Akron, Ohio, The Goodyear Tire & Rubber Company
(NYSE: GT) -- http://www.goodyear.com/-- is the world's largest
tire company. The company manufactures tires, engineered rubber
products and chemicals in more than 90 facilities in 28
countries. Goodyear Tire has marketing operations in almost
every country around the world including Chile, Colombia,
Guatemala, Jamaica and Peru in Latin America. Goodyear employs
more than 80,000 people worldwide.
* * *
As reported in the Troubled Company Reporter on Jan. 9, Fitch
Ratings affirmed its ratings on Goodyear Tire & Rubber Co. and
removed them from Rating Watch Negative where they were placed
on Oct. 18, 2006, when the company announced a US$975 million
drawdown of its bank revolver. Fitch affirmed Goodyear's Issuer
Default Rating at B. Fitch said the Rating Outlook is Negative.
* JAMAICA: Secures US$9-Million Credit Commitment from India
------------------------------------------------------------
The Indian government has agreed to extend a US$9 million line
of credit to Jamaica through the Ex-Im Bank of India, the
Jamaica Gleaner reports.
The loan was agreed upon by Prime Minister Portia Simpson Miller
and India's Minister of State for External Affairs Anand Sharma
during the recently concluded bilateral talks between the two
countries, the same report says. The fund will be used to
purchase equipment to support Jamaica's rural water development
program. Also, part of the loan will be utilized to provide
equipment and machinery for the small business setor.
* * *
On May 26, 2006, Moody's Investors Service upgraded Jamaica's
rating under a revised foreign currency ceiling:
-- Long-term foreign currency rating: Ba3 from B1 with
stable outlook.
===========
M E X I C O
===========
CHEMTURA CORP: Posts US$144.3MM Net Loss in 2006 Fourth Quarter
---------------------------------------------------------------
Chemtura Corp. reported a net loss of US$144.3 million on net
sales of US$873.6 million for the fourth quarter ended
Dec. 31, 2006, compared with a net loss of US$71.5 million on
net sales of US$876.1 million for the comparable period in 2005.
The company's 2006 full-year net loss was US$170.6 million on
net sales of US$3.7 billion, as compared with a net loss of
US$186.6 million on net sales of US$2.9 billion for 2005.
Loss from continuing operations for the fourth quarter of 2006
and 2005, were US$145.9 million and US$92.9 million,
respectively. Loss from continuing operations for years 2006
and 2005, were US$218.1 million and US$184.8 million,
respectively.
At Dec. 31, 2006, the company's balance sheet showed US$4.37
billion in total assets, US$2.65 billion in total liabilities,
and US$1.72 billion in total stockholders' equity.
Fourth Quarter Results
The company's fourth quarter net sales of US$873.6 million were
less than one percent below fourth quarter 2005 net sales of
US$876.1 million. The decrease is primarily due to lower sales
of US$10.4 million related to the sale of the company's
Industrial Water Additives business in May 2006 and an US$18.1
million decrease in sales volume. The decrease, however, were
mostly offset by increased selling prices of US$16.1 million and
favorable foreign currency translation of US$12 million.
The operating loss for the fourth quarter of 2006 was
US$15.6 million, as compared with an operating loss of
US$400,000 for the fourth quarter of 2005.
Fourth quarter earnings reflect a charge of US$123 million to
establish a deferred tax liability related to this repatriation
strategy.
During the fourth quarter of 2006, the company recorded a gain
on sale of discontinued operations of US$1.6 million, net of
taxes of US$200,000, related to the sale of the OrganoSilicones
business to General Electric Co. in July 2003. The gain
represents the reversal of reserves for certain contingencies
that the company no longer expects to incur.
Full-year Results
Net sales for the year ended Dec. 31, 2006, of US$3,722.7
million were US$736.1 million above net sales for the comparable
period of 2005 of US$2,986.6 million.
The increase was primarily due to US$855.6 million in additional
sales resulting from the merger with Great Lakes Chemical Corp.,
a US$62.8 million increase in selling prices and US$5 million
due to favorable foreign currency translation that was partially
offset by a US$108.3 million decrease in sales volume, the
absence of US$48.3 million of sales due to the deconsolidation
of the company's Polymer Processing Equipment business in April
2005, US$21.5 million due to the divestiture of the IWA business
in May 2006, and US$9.1 million due to the net effect of other
acquisitions and divestitures.
At Dec. 31, 2006, the company's balance sheet showed US$4.37
billion in total assets, US$2.65 billion in total liabilities,
and US$1.72 billion in total stockholders' equity.
About Chemtura Corp.
Headquartered in Middlebury, Connecticut, Chemtura Corp. (NYSE:
CEM) -- http://www.chemtura.com/-- is a global supplier of
plastic additives, including flame-retardants. The company also
manufactures and markets pool and spa products and seed
treatment and miticide in the agricultural market. Chemtura
has more than 6,500 employees in research, manufacturing, sales
and administrative facilities in every major market of the
world. In Latin America, Chemtura has facilities in Brazil and
Mexico.
* * *
As reported in the Troubled Company Reporter on Nov. 7, 2006,
Moody's Investors Service affirmed its Ba1 Corporate Family
Rating for Chemtura Corp. Additionally, Moody's held its Ba1
probability-of-default rating on the company's US$500 Million
6.875% Guaranteed Senior Notes due June 2016.
CLEAR CHANNEL: Urges Shareholders to Vote for Proposed Merger
-------------------------------------------------------------
Clear Channel Communications, Inc., announced that it will mail
a letter to its shareholders regarding the proposed merger with
a group led by T.H. Lee Partners, L.P. and Bain Capital
Partners, LLC, for US$37.60 per share in cash.
The company's letter states:
Dear Fellow Shareholder:
At the March 21st special meeting of Clear Channel shareholders,
you will make a critical decision regarding the future of your
company. If shareholders approve the company's agreement to be
acquired by funds sponsored by Bain Capital Partners, LLC and
Thomas H. Lee Partners, L.P., you will receive US$37.60 in cash
for each share of common stock you own. The disinterested
directors of your Board have unanimously determined that the
merger is fair and in your best interests. WE URGE YOU TO VOTE
FOR THE PROPOSED MERGER TODAY.
THE PROPOSED MERGER IS THE RESULT OF A HIGHLY COMPETITIVE PUBLIC
AUCTION CONDUCTED BY THE DISINTERESTED MEMBERS OF THE BOARD
The disinterested directors carefully managed the auction
process to maximize the competitive dynamics of the bid process
to obtain the highest price available:
* Multiple rounds of robust bidding,
* Firm, fully financed offers submitted by two separate
consortiums of private equity funds,
* Virtually every leading private equity sponsor
participated -- no strategic buyers emerged, and
* During the "go-shop" period, the company's financial
advisor contacted a total of 22 potential strategic and
private equity buyers, none of whom expressed interest in
bidding for Clear Channel.
WE FIRMLY BELIEVE THERE IS NOT ANOTHER COMPETITIVE BIDDER FOR
CLEAR CHANNEL, AND THAT US$37.60 PER SHARE IN CASH MAXIMIZES
VALUE AND CERTAINTY
The auction process was conducted by the disinterested members
of the Board of Directors, and supported by a Special Advisory
Committee composed of three disinterested directors. The Board
and the Special Advisory Committee also received advice and
assistance from separate financial and legal advisors, who were
actively involved in the auction process. In order to ensure
independence, these meetings - and all of the Board's
deliberations in relation to the competitive sale process - were
conducted without the participation of Clear Channel management
or the Mays family. Chairman and founder L. Lowry Mays has
informed the company that he will be selling a substantial
majority of his holdings in the transaction.
THE PROPOSED MERGER IS THE RESULT OF A COMPREHENSIVE REVIEW OF
STRATEGIC ALTERNATIVES
This merger proposal is the result of a comprehensive review of
strategic alternatives designed to enhance shareholder value,
taking into account the continued challenges in the radio sector
and the Board's views of the recent growth in the domestic
outdoor sector, as well as Clear Channel's future growth
opportunities. During their review, the disinterested directors
considered a full range of alternatives other than the sale of
the company, including a sale or spin-off of Clear Channel
Outdoor, recapitalization, share repurchase and special
dividend, as well as remaining as an independent company.
Particular consideration was given to the structural issues
related to any potential separation of Clear Channel Outdoor,
including significant tax implications, and the likely trading
value of its shares in the absence of this transaction.
In light of these considerations, the unanimous conclusion of
the disinterested directors was that the US$37.60 per share in
cash merger proposal results in the greatest value and delivers
the greatest certainty to shareholders.
THE MERGER PROPOSAL DELIVERS A 28% PREMIUM OVER THE AVERAGE
SHARE PRICE DURING THE 60 TRADING DAYS PRIOR TO THE COMPANY'S
ANNOUNCEMENT THAT THE BOARD WAS CONSIDERING STRATEGIC
ALTERNATIVES
The all-cash merger consideration of US$37.60 per share
represents a premium of approximately 28% over the average
closing share price during the 60 trading days ended
Oct. 24, 2006, the day prior to the company's announcement of
the Board's decision to consider strategic alternatives, and a
premium of approximately 26% over the average closing share
price during the one-year period prior to the announcement of
the merger.
The merger consideration is also a significant premium to
research analysts' stock price targets for Clear Channel, prior
to the company's announcement that the Board was exploring
strategic alternatives.
The merger agreement negotiated by the disinterested directors
contains measures designed to ensure shareholders certainty of
closing as well as to protect against business and market risks,
including:
* Certainty of US$37.60 in cash,
* Regular annual dividend of US$0.75 per share to be paid
quarterly through closing,
* Daily "ticking fee"- in order to ensure that the
transaction is closed as soon as possible -- of the lesser
of 8% interest per year or the company's operating cash
flow beginning Jan. 1, 2008, through closing,
* Equity and debt commitments with no financing conditions,
* Requirement for the buyers to take all necessary steps to
obtain regulatory approval, with reverse break-up fees
owed in the event of a failure to close should regulatory
approval not be received, and
* The ability to receive and consider competing proposals.
YOUR VOTE IS EXTREMELY IMPORTANT -- NOT VOTING IS A VOTE AGAINST
THE MERGER
Approval of the merger agreement requires the affirmative vote
of two-thirds of Clear Channel's outstanding shares. Not voting
has the same effect as a vote against the merger. Please vote
for the merger today by telephone or by Internet, as available
per the instructions on the enclosed proxy card, or by signing
and returning the enclosed proxy card in the postage-paid
envelope provided.
If you have any questions or need assistance in voting your
shares, please call our proxy solicitor, Innisfree M&A
Incorporated, toll-free at (877) 456-3427.
Thank you for your support.
On behalf of the Board of Directors,
Alan D. Feld - Perry J. Lewis
About Thomas H. Lee Partners, L.P.
Thomas H. Lee Partners or THL Partners is one of the oldest and
most successful private equity investment firms in the United
States. Since its founding in 1974, THL Partners has become the
preeminent growth buyout firm, investing approximately US$12
billion of equity capital in more than 100 businesses with an
aggregate purchase price of more than US$100 billion, completing
over 200 add-on acquisitions for portfolio companies, and
generating superior returns for its investors and partners. The
firm currently manages approximately US$20 billion of committed
capital. Notable transactions sponsored by the firm include
Dunkin Brands, Nielsen, Michael Foods, Houghton Mifflin Company,
Fisher Scientific, Experian, TransWestern, Snapple Beverage and
ProSiebenSat1 Media.
About Bain Capital Partners, LLC
Bain Capital http://www.baincapital.com/-- is a global private
investment firm that manages several pools of capital including
private equity, high-yield assets, mezzanine capital and public
equity with more than US$40 billion in assets under management.
Since its inception in 1984, Bain Capital has made private
equity investments and add-on acquisitions in over 230 companies
around the world, including investments in a broad range of
companies such as Burger King, HCA, Warner, Chilcott, Toys "R"
Us, AMC Entertainment, Sensata Technologies, Burlington Coat
Factory and ProSiebenSat1 Media. Headquartered in Boston, Bain
Capital has offices in New York, London, Munich, Tokyo, Hong
Kong and Shanghai.
About Clear Channel Communications Inc.
Based in San Antonio, Texas, Clear Channel Communications Inc.
-- http://www.clearchannel.com/-- (NYSE:CCU) is a global leader
in the out-of-home advertising industry with radio and
television stations and outdoor displays. Aside from the U.S.,
the company operates in 11 countries -- Norway, Denmark, the
United Kingdom, Singapore, China, the Czech Republic,
Switzerland, the Netherlands, Australia, Mexico and New Zealand.
* * *
Clear Channel's long-term local and foreign issuer credits carry
Standard & Poor's BB+ rating.
In addition, the company's senior unsecured debt and long-term
issuer default ratings were placed by Fitch at BB- on
Nov. 16, 2006.
DELTA AIR: Comair Pilots Approve Contract
-----------------------------------------
Pilots of Comair, represented by the Air Line Pilots
Association, Int'l., in Friday ratified the tentative agreement
reached with their management last month on a contract that will
help Delta Airlines and Comair emerge from bankruptcy. Over 68%
percent of the pilots voted in favor of the agreement.
Commenting on the ratification, Captain J.C. Lawson, chairman of
the Comair ALPA unit said, "The pilots had an extremely
difficult decision to make and were faced with choosing between
the better of two difficult outcomes. This settlement is the
result of a pass through the bankruptcy process that no union
would have voluntarily chosen. However we did endorse it as a
better alternative than the terms that the bankruptcy court had
authorized Delta/Comair management to impose upon the pilots."
The agreement includes an US$82.5 million bankruptcy claim for
the Comair pilots, which was recently sold.
Reaching the overall agreement was the result of a long
difficult process that strained relations between the pilot
group and management. "As we move forward toward emerging from
bankruptcy, it is essential that management address the strained
relations that developed over the last 18 months," said Lawson.
"It is going to take a lot of effort and dedication to repair
the damage to the working environment. Pilots are highly
skilled professionals that make critical decisions everyday and
expect to be treated as the professionals that they are."
Lawson said. He concluded with "There is no greater strength
than a management team that has all of their employees on the
same page, working together."
Founded in 1931, ALPA -- http://www.alpa.org/-- is the largest
pilot union, representing 60,000 cockpit crewmembers at 40
airlines in the U.S. and Canada.
About Delta Air
Headquartered in Atlanta, Georgia, Delta Air Lines (OTC: DALRQ)
-- http://www.delta.com/-- is the world's second-largest
airline in terms of passengers carried and the leading U.S.
carrier across the Atlantic, offering daily flights to 502
destinations in 88 countries on Delta, Song, Delta Shuttle, the
Delta Connection carriers and its worldwide partners. The
Company and 18 affiliates filed for chapter 11 protection on
Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923).
Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represents
the Debtors in their restructuring efforts. Timothy R. Coleman
at The Blackstone Group L.P. provides the Debtors with financial
advice. Daniel H. Golden, Esq., and Lisa G. Beckerman, Esq., at
Akin Gump Strauss Hauer & Feld LLP, provide the Official
Committee of Unsecured Creditors with legal advice. John
McKenna, Jr., at Houlihan Lokey Howard & Zukin Capital and James
S. Feltman at Mesirow Financial Consulting, LLC, serve as the
Committee's financial advisors. As of June 30, 2005, the
company's balance sheet showed US$21.5 billion in assets and
US$28.5 billion in liabilities.
FORD MOTOR: Will Sell APCO Assets to Trident IV
-----------------------------------------------
Ford Motor Company has entered into a definitive agreement to
sell Automobile Protection Corporation to Trident IV, L.P., a
private equity fund managed by Stone Point Capital LLC. This
transaction is the result of the review of strategic options for
the business announced by Ford on Oct. 11, 2006.
The sale is expected to close during the second quarter and is
subject to customary closing conditions, including applicable
regulatory approvals. Terms and conditions specific to the
agreement are not being disclosed at this time.
APCO, a wholly owned subsidiary of Ford Motor Company, was
purchased by Ford Motor Company in July 1999. APCO offers
vehicle service contracts and related after-market products to
dealers of all makes and models.
About Stone Point
Stone Point Capital is a global private equity firm based in
Greenwich, Connecticut that manages the Trident Funds and has
raised more than US$8 billion in committed capital to make
investments in the global insurance and financial services
industries.
About Ford Motor
Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) --
http://www.ford.com/-- manufactures and distributes automobiles
in 200 markets across six continents. With more than 324,000
employees worldwide, the company's core and affiliated
automotive brands include Aston Martin, Ford, Jaguar, Land
Rover, Lincoln, Mazda, Mercury and Volvo. Its automotive-
related services include Ford Motor Credit Company and The Hertz
Corporation.
* * *
As reported in the Troubled Company Reporter on Dec. 12, 2006,
Standard & Poor's Ratings Services affirmed its 'B' bank loan
and '2' recovery ratings on Ford Motor Co. after the company
increased the size of its proposed senior secured credit
facilities to between US$17.5 billion and US$18.5 billion, up
from US$15 billion.
As reported in the Troubled Company Reporter on Dec. 7, 2006,
Fitch Ratings downgraded Ford Motor Company's senior unsecured
ratings to 'B-/RR5' from 'B/RR4' due to the increase in size of
both the secured facilities and the senior unsecured convertible
notes being offered.
As reported in the Troubled Company Reporter on Dec. 6, 2006,
Moody's Investors Service assigned a Caa1, LGD4, 62% rating to
Ford Motor Company's US$3 billion of senior convertible notes
due 2036.
GENERAL MOTORS: Reports Increase in U.S. Sales for February
-----------------------------------------------------------
Despite an expected decline in U.S. industry sales, General
Motors Corp. reported a 3.4% total sales increase, compared with
February 2006. The sales gain was due to an 11% retail sales
increase. Retail and fleet sales by GM dealers in the United
States totaled 311,763 vehicles, compared with sales of 301,545
in February 2006. Fleet sales were down 18% due to a planned
25% reduction in daily rental sales.
"Our pickup, SUV and crossover business was terrific across the
board," Mark LaNeve, vice president, GM North American Sales,
Service and Marketing, said. "Our customers are telling us that
we have the winning formula -- the best products, industry-
leading fuel economy and the best value."
February's performance was led by the new GMC Sierra and the
North American Truck of the Year Chevrolet Silverado full-size
pickups. Silverado had its best February sales month in five
years, total full-size pickup sales were up 29% and total truck
sales were up more than 7% compared with last February. The
critically acclaimed new GMC Acadia and Saturn Outlook drove a
97% retail increase in the mid-crossover segment.
"With GM offering the best coverage in our 5 year/100,000 mile
powertrain limited warranty with roadside assistance and
courtesy transportation, we believe customers see our vehicles
as having outstanding value and quality that is better than the
competition," Mr. LaNeve added. "With a less than stellar
industry performance, our February sales results stand out."
The Chevrolet, GMC, Saturn and Pontiac divisions all saw retail
increases in February.
Retail truck sales were up 16% compared with February 2006 and
total truck sales were up 7%. Leading the retail sales gains
were full-size pickups, up 36% compared with February 2006, with
positive showings by Chevrolet Avalanche, up 110% and Silverado,
up 34%. GMC Sierra retail sales volume was up 27% compared with
last February.
Retail increases by the Cadillac Escalade ESV and Escalade EXT,
compared with February 2006, pushed GM's large luxury utilities
segment up 7% compared with last February.
Driven by an increase in Chevrolet Aveo retail sales, GM's
economy car segment retail volume was up 17% compared with
February 2006. A 45% retail increase in Pontiac G6 and a 65%
increase in Chevrolet Impala retail sales, compared with the
same month a year ago, pushed GM's mid-car segment retail volume
up 25%.
In February, GM's mix of total fleet to retail sales continued
to improve significantly. Retail sales were 78.5% of total
sales, compared with 73% last February; fleet sales were 21.5%,
compared with 27% last year.
GM February sales reflected the continuing strength of the new
product portfolio with competitive incentive spending, balanced
with ongoing reductions in daily rental fleet sales.
Certified Used Vehicles
February 2007 sales for all certified GM brands, including GM
Certified Used Vehicles, Cadillac Certified Pre-Owned Vehicles,
Saturn Certified Pre-Owned Vehicles, Saab Certified Pre-Owned
Vehicles and HUMMER Certified Pre-Owned Vehicles, were 42,855
units, up nearly 6% from last February. Year-to-date sales for
all certified GM brands are up nearly 8% from the same period
last year.
GM Certified Used Vehicles, the industry's top-selling
manufacturer-certified used brand, posted February sales of
37,840 units, up nearly 7% from February 2006. Year-to-date
sales are 75,390 units, up 8%.
Cadillac Certified Pre-Owned Vehicles posted February sales of
3,111 units, comparable to last February. Saturn Certified Pre-
Owned Vehicles sold 1,262 units in February, down 11%. Saab
Certified Pre-Owned Vehicles sold 540 units, up 7%, and HUMMER
Certified Pre-Owned Vehicles sold 102 units, up 183%.
About General Motors Corp.
General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- the
world's largest automaker, has been the global industry sales
leader since 1931. Founded in 1908, GM employs about 317,000
people around the world. It has manufacturing operations in 32
countries, including Mexico, and its vehicles are sold in 200
countries.
* * *
Standard & Poor's Ratings Services, on Dec. 13, 2006, affirmed
its 'B' corporate credit rating and other ratings on General
Motors Corp. and removed them from CreditWatch with negative
implications, where they were placed on March 29, 2006.
On Jan. 29, 2007, S&P said that the company's announcement that
it is restating financial results from 2002 through the third
quarter of 2006 raises new concerns about the integrity of the
company's financial reporting and internal controls, but has no
immediate effect on the ratings on GM, GMAC LLC
(BB+/Developing/B-1), or GMAC unit Residential Capital LLC
(ResCap; BBB/Negative/A-3).
On Nov. 14, 2006, Moody's Investors Service assigned a Ba3,
LGD1, 9% rating to the proposed US$1.5 Billion secured term
loan. The term loan is expected to be secured by a first
priority perfected security interest in all of the US machinery
and equipment, and special tools of GM and Saturn Corporation.
LEVI STRAUSS: S&P Assigns B Rating on Proposed US$325-Mil. Loan
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' rating to
apparel marketer and distributor Levi Strauss & Co.'s proposed
US$325 million senior unsecured term loan due 2014. Proceeds
from the term loan, along with cash on hand, will be used to
retire or fully call the existing US$380 million floating rate
notes due April 2012.
At the same time, Standard & Poor's said it raised all of its
ratings on the company by one notch, including raising its 'B-'
long-term corporate credit rating to 'B'. The outlook is
positive.
"The rating upgrade incorporates the company's continued
improved operating performance and enhanced liquidity profile,
its increased financial flexibility from its proposed
refinancing, and our expectation that the positive operating
trends will continue," said Standard & Poor's credit analyst
Susan Ding.
The ratings on Levi Strauss & Co. reflect its leveraged
financial profile and participation in the intensely competitive
denim and casual pants market. The ratings also incorporate the
inherent fashion risk in the apparel industry, and company-
specific rating concerns, including management's ability to
fully turn around the company, revitalize its brands, and
sustain its revenue base.
Levi Strauss & Co. -- http://www.levistrauss.com/-- is a
branded apparel company, with sales in more than 110 countries.
Levi Strauss designs and markets jeans and jeans-related pants,
casual and dress pants, tops, jackets and related accessories
for men, women and children under its Levi's(R), Dockers(R) and
Levi Strauss Signature(R) brands. Levi Strauss also licenses
its trademarks in various countries throughout the world for
accessories, pants, tops, footwear, home and other products.
Levi Strauss & Co. is a worldwide corporation organized into
three geographic divisions: North America, Europe and Asia
Pacific. Levi Strauss North America is the company's largest
region and employs approximately 3,775 people throughout the
United States, Canada and Mexico.
NORTEL NETWORKS: Restating Financials Due to Calculation Errors
---------------------------------------------------------------
Nortel Networks Corporation is delaying the filing with the U.S.
Securities and Exchange Commission of its annual report on Form
10-K for the year ended Dec. 31, 2006, and its corresponding
filings under Canadian securities laws.
The company has identified certain errors primarily through
discussions with Nortel's North American pension and post-
retirement plan actuaries and through Nortel's ongoing
remediation efforts with respect to its previously reported
internal control deficiencies. As a result, Nortel and its
principal operating subsidiary Nortel Networks Limited will
restate their financial results for 2004, 2005 and the first
nine months of 2006, and will make adjustments to periods prior
to 2004.
"This restatement has no material impact to our fourth quarter
2006 operating expectations or performance," Peter Currie,
Nortel executive vice president and CFO, said. "During 2006, we
have implemented significant remedial measures and other actions
to address our internal control weaknesses. This has resulted
in a substantial reduction of control weaknesses as at yearend
and represents a major milestone in our journey toward
consistent, reliable and timely financial reporting. We will
conclude the restatement and complete our regulatory filings
within the timely filer period."
"Nortel made tremendous progress advancing its business
transformation plan in 2006, and the announcement does not slow
our progress or divert our focus," Mike Zafirovski, Nortel
president and CEO, said. "Our expected fourth quarter results
show measurable operating and financial improvements. We are a
stronger, more competitive company today and we will continue to
drive our progress into 2007 and beyond."
The restatement will primarily correct third party actuarial
calculation errors embedded in Nortel's North American pension
and post-retirement plans and revenue incorrectly recognized in
prior periods that should have been deferred to later periods.
These matters have been fully discussed with the Staff of the
SEC including as part of the company's responses to staff
comments on Nortel's periodic filings with the SEC.
The company currently expects revisions to its previously
reported 2006 nine month results resulting in increases in
revenues and improvements in net earnings of approximately US$24
million and US$15 million, respectively, as well as revisions to
its previously reported 2005 and 2004 financial results
reflecting reductions in revenue of approximately US$28 million
and US$33 million and increases in net loss of approximately
US$87 million and US$42 million, respectively. With respect to
financial results prior to 2004, the company currently expects
revisions reflecting negative impacts on revenue of
approximately US$27 million and negative impacts on net earnings
of approximately US$5 million, in the aggregate.
The company expects to file its and NNL's 2006 Form 10-K by no
later than March 16, 2007.
Preliminary Results for Fourth Quarter Performance
Fourth quarter 2006 revenues are expected to be approximately
US$3.32 billion, up 10.2% from US$3.01 billion for the same
period in 2005. Gross margin in the quarter is expected to be
at slightly above 40% of revenue, with a strong contribution
from the LG joint venture and CDMA, up from 38.8% in the fourth
quarter of 2005.
At Dec. 31, 2006, cash as was approximately US$3.50 billion, up
about US$900 million from Sept. 30, 2006. This includes
approximately US$300 million of gross proceeds from the sale of
certain assets and liabilities of the UMTS Access business to
Alcatel-Lucent.
Restatement
As a result of the previously announced pension plan changes,
third party actuarial firms retained by the company performed
re-measurements of the U.S. and Canadian pension and post-
retirement plans in the third quarter of 2006, at which time one
of these firms discovered potential errors (generally
originating in the late 1990s) in the historical actuarial
calculations they had originally performed on the U.S. pension
plan assets.
Throughout the fourth quarter of 2006 and into 2007, the company
investigated these potential errors, including a review by the
company and its third party actuaries of each of the company's
significant pension and post-retirement benefit plans. As a
result of this review, the company determined that it had
understated its historical pension expense with respect to the
U.S. and Canadian plans by approximately US$104 million across
several years and currently expects a negative impact to its
previously reported 2006 nine months pension expense and net
earnings of approximately US$18 million and revisions to its
previously reported financial results for 2005 and 2004
reflecting an increased pension expense and increases in net
loss of US$48 million and US$40 million, respectively. For
periods prior to 2004, these errors are expected to positively
impact pension expense and net earnings by approximately US$2
million, in the aggregate.
As a result of the significant ongoing remedial efforts to
address Nortel's internal control material weaknesses and other
deficiencies, the company also expects to correct for
additional, individually immaterial errors identified throughout
2006. These errors related mainly to revenue recognition errors
with revenue having generally been recognized prematurely in
prior years when it should have been deferred and recognized in
later periods.
The company expects revisions to its previously reported 2006
nine months results reflecting positive impacts on revenue of
approximately US$24 million and a reduction of net loss of
approximately US$33 million, and revisions to its previously
reported 2005 and 2004 financial results reflecting negative
impacts on revenue of approximately US$28 million and US$33
million, and on net loss of approximately US$39 and US$2,
respectively. For periods prior to 2004, these errors are
expected to negatively impact revenue by approximately US$27
million and net earnings by approximately US$7 million, each in
the aggregate.
Restatement Impact
As a result of the breach or anticipated breach of certain
provisions of NNL's US$750 million support facility with Export
Development Canada related to the required restatement by NNL of
certain of its prior period results, absent a waiver, EDC will
have the right to refuse to issue additional support and to
terminate its commitments under the Support Facility, subject to
a 30 day cure period with respect to certain provisions. As at
Feb. 28, 2007, there was approximately US$144 million of
outstanding support under the Support Facility. NNL will
request a waiver from EDC to permit continued access to the
Support Facility. There can be no assurance that NNL will
receive such a waiver. The company expects to file its and
NNL's 2006 Form 10-Ks within the cure period.
As the company expects to file its 2006 Form 10-K within the
15-day period permitted by Rule 12b-25, and NNL expects to file
its 2006 Form 10-K by the applicable March 31, 2007 deadline, it
is anticipated that the delay will not result in a breach or
anticipated breach of provisions with respect to Nortel's
outstanding indebtedness and related indentures.
About Nortel
Nortel Networks Limited is the principal direct operating
subsidiary of Nortel Networks Corporation.
Headquartered in Ontario, Canada, Nortel Networks Limited
(NYSE/TSX: NT) -- http://www.nortel.com/-- delivers technology
solutions encompassing end-to-end broadband, Voice over Internet
provider, multimedia services and applications, and wireless
broadband. Nortel Networks does business in more than 150
countries, including Mexico.
* * *
As reported in the Troubled Company Reporter on Oct. 5, 2006,
Moody's Investors Service upgraded its B3 Corporate Family
Rating for Nortel Networks Corp. to B2.
VALASSIS COMM: Completes ADVO Acquisition for US$1.2 Billion
------------------------------------------------------------
Valassis Communications Inc. has completed its acquisition of
ADVO, Inc., a direct mail media company, for an acquisition
price of approximately US$1.2 billion (on a fully diluted
basis), including the refinancing of approximately US$125
million in existing ADVO debt. The transaction was finalized on
Friday. Shares of ADVO common stock were acquired by Valassis
for US$33.02 per share in cash, which includes interest accrued
from Feb. 28, 2007, in accordance with the merger agreement. As
a result of the acquisition, ADVO common stock will no longer be
traded as of March 5, 2007.
Valassis funded the ADVO acquisition, together with the
refinancing of ADVO debt and the payment of fees and expenses,
through an US$870.0 million senior secured credit facility with
a syndicate of lenders jointly arranged by Bear, Stearns & Co.
Inc. and Banc of America Securities LLC, US$540.0 million in
Valassis' 8-1/4% Senior Notes due 2015 and existing cash on
hand.
The combination of Valassis and ADVO provides the delivery of
value-oriented consumer promotions by blending home newspaper
delivery with shared direct mail. The combined company features
the most comprehensive products and services offering in the
industry serving over 15,000 advertisers worldwide, including 96
of the top 100 advertisers in the United States. The combined
company now has 7,500 employees with operations in 22 states and
nine countries.
"Today is a historic day as it marks the largest acquisition in
Valassis history, further advancing a key growth strategy put
into effect eight years ago," said Alan F. Schultz, Valassis
Chairman, President and CEO. "By combining Valassis and ADVO,
we are creating the nation's leading marketing services company.
With complementary products, customers and distribution methods,
we will now be able to offer superior customer solutions of
unmatched reach, scale and value. This unique offering will
allow us to gain a greater share of our customers' marketing
budgets. We are working to make the integration process as
seamless as possible for all of our stakeholders. In addition,
over the next few years we will work diligently to maximize free
cash flow and reduce debt."
"We are excited to have finalized the Valassis-ADVO transaction
and begin writing a new chapter in the company's history by
combining ADVO's highly complementary shared mail with Valassis'
newspaper-delivered offerings and existing 1 to 1 channels,"
said Robert A. Mason, ADVO President. "ADVO's extensive shared
mail network will augment Valassis' newspaper distribution
network by providing shared mail reach to over 90 percent of
U.S. homes. We now have the ability to grow our business by
offering customers jointly-developed programs which optimize and
integrate the usage of multiple distribution methods."
Mr. Schultz will remain in his current role and lead the
combined company, with Mr. Mason serving as President of ADVO.
Valassis' executive management team will take an active role in
the combined company's strategic direction. William F. Hogg,
Valassis Executive Vice President of Manufacturing and Client
Services, will continue to lead integration efforts while at the
same time leading the manufacturing and client services areas of
the combined company. Donald E. McCombs will retain his title
of ADVO Executive Vice President and President of Operations.
The combined company will be governed by the current Valassis
Board of Directors and will continue to be headquartered in
Livonia, Mich. ADVO will maintain a substantial presence in
Windsor, Conn., where it has three locations.
Headquartered in Livonia, Michigan, Valassis Communications Inc.
(NYSE: VCI) -- http://www.valassis.com/-- provides marketing
services to consumer-packaged goods manufacturers, retailers,
technology companies and other customers with operations in the
United States, Europe, Mexico and Canada. Valassis' products
and services portfolio includes: newspaper-delivered promotions
and advertisements such as inserts, sampling, polybags and
on-page advertisements; direct-to-door advertising and sampling;
direct mail; Internet-delivered marketing; loyalty marketing
software; coupon and promotion clearing; and promotion planning
and analytic services.
* * *
As reported in the Troubled Company Reporter-Latin America on
Feb. 27, 2007, Standard & Poor's Ratings Services assigned its
'B-' rating to Valassis Communications Inc.'s proposed US$590
million senior unsecured notes.
As reported in the Troubled Company Reporter-Latin America on
Feb. 19, 2007, Moody's Investors Service assigned a B3 rating to
Valassis Communications, Inc.'s proposed US$590 million of fixed
and floating rate senior unsecured notes due 2015. Moody's
Feb. 12, 2007, rating action on Valassis contemplated the
issuance of US$590 million of junior debt in conjunction with
the acquisition of ADVO and the company's existing ratings are
not affected by the issuance of the new senior unsecured notes.
Valassis' Corporate Family rating is B1 and the rating outlook
remains stable.
===========
P A N A M A
===========
AES CORP: Delays Filing of 2006 Annual Report
---------------------------------------------
The AES Corporation disclosed that it would delay the filing of
its 2006 Annual Report on Form 10-K with the U.S. Securities and
Exchange Commission. The company's 2006 annual report on Form
10-K could not be filed by March 1, 2007, without unreasonable
effort or expense due to the fact that the company had to
allocate significant time and resources to the restatement of
prior period financials that will be filed with the 2006 report
on Form 10-K and its continuing accounting review, including
with respect to those matters described in the Form 8-K filed by
the company on Feb. 26, 2007. Although the company can provide
no assurance that it will able to file in that time period if
additional issues are identified in its review, the company
currently believes that the Form 10-K can be filed no later than
the fifteenth calendar day following the date on which the Form
10-K was due.
AES Corp. -- http://www.aes.com/-- is a global power
company. The company operates in South America, Europe, Africa,
Asia and the Caribbean countries. Generating 44,000 megawatts
of electricity through 124 power facilities, the company
delivers electricity through 15 distribution companies.
AES Corp.'s Latin America business group is comprised of
generation plants and electric utilities in Argentina, Brazil,
Chile, Colombia, Dominican Republic, El Salvador, Panama and
Venezuela. Fuels include biomass, diesel, coal, gas and hydro.
The group also pursues business development activities in the
region. AES has been in the region since May 1993, when it
acquired the CTSN power plant in Argentina.
* * *
As reported in the Troubled Company Reporter - Latin America on
Oct. 20, 2006, Moody's Investors Service's downgraded its B1
Corporate Family Rating for AES Corporation in connection with
the implementation of its new Probability-of-Default and Loss-
Given-Default rating methodology. Additionally, Moody's revised
its probability-of-default ratings and assigned loss-given-
default ratings on the company's loans and bond debt obligations
including the B1 rating on its senior unsecured notes 7.75% due
2014, which was also given an LGD4 loss-given default rating,
suggesting noteholders will experience a 55% loss in the event
of a default.
GRUPO BANISTMO: HSBC Seeks Regulator's Permission to Absorb Firm
----------------------------------------------------------------
Panamanian banking regulator SBP posted on its Web site that the
HSBC Bank has asked its permission to absorb Grupo Banistmo.
Business News Americas relates that HSBC Bank is part of
financial group HSBC Holdings that purchased Grupo Banistmo for
US$1.77 billion in November 2006.
According to BNamericas, the merger plan includes HSBC Bank's
absorption of commercial bank Primer Banco del Istmo.
Grupo Banistmo owns Primer Banco del Istmo, BNamericas states.
Panamanian bank Primer Banco del Istmo (Banistmo) started
operations in September 1984 under the name Banco del Istmo.
Banistmo is the country's largest bank and also one of the
biggest financial institutions in Central America.
* * *
As reported in the Troubled Company Reporter-Latin America on
July 25, 2006, Moody's Investors Service placed the Ba1/Not
Prime long- and short-term deposit ratings of Primer Banco del
Istmo, SA aka Banistmo on review for possible upgrade.
* * *
As reported in the Troubled Company Reporter-Latin America on
July 25, 2006, Standard & Poor's Ratings Services placed its
'BB+/B' counterparty credit rating on Primer Banco del Istmo SA
aka Banistmo on CreditWatch with positive implications. S&P has
also placed its 'BB/B' counterparty credit rating on Banco
Salvadoreno SA on CreditWatch with positive implications and
affirmed its ratings on HSBC Holdings PLC (HSBC) and related
entities, including the 'AA-/A-1+' counterparty credit rating on
HSBC, with a stable outlook.
=======
P E R U
=======
GRAN TIERRA: Secures US$50-Million Financing with Standard Bank
---------------------------------------------------------------
Gran Tierra Energy Inc. has secured a three-year senior
revolving credit facility of up to US$50 million with Standard
Bank Plc. Proceeds from the facility will be used for Gran
Tierra's petroleum operations in South America.
The initial borrowing base under the facility is US$7 million
and amounts drawn down under the facility bear interest at the
Eurodollar rate plus 4%. The facility is secured primarily on
the Company's Colombian assets. Additional terms of the credit
facility agreement will be included in the company's 8-K to be
filed with the U.S. Securities and Exchange Commission.
Dana Coffield, President and Chief Executive Officer of Gran
Tierra, stated, "In keeping with our mission to grow our base
of production and cash flow from development and exploration
opportunities, this credit facility provides further resources
for expanding the company's current drilling program and future
exploration activities in South America."
Gran Tierra Energy Inc. (OTCBB: GTRE.OB) --
http://www.grantierra.com/-- is an international oil and gas
exploration and development company headquartered in Calgary,
Canada, incorporated and traded in the United States and
operating in South America. The company currently holds
interests in producing and prospective properties in Argentina,
Colombian and Peru.
* * *
Management disclosed that the company's ability to continue as a
going concern is dependent upon obtaining the necessary
financing to acquire oil and natural gas interests and
generating profitable operations from its oil and natural gas
interests in the future. The company incurred a net loss of
US$1.9 million for the nine-month period ended Sept. 30, 2006,
and, as at Sept. 30, 2006, had an accumulated deficit of US$4.1
million.
=====================
P U E R T O R I C O
=====================
AFC ENTERPRISES: Kenneth Keymer Steps Down as Chief Executive
-------------------------------------------------------------
AFC Enterprises Inc.'s Chief Executive Officer and President
Kenneth L. Keymer will resign effective March 30, 2007.
Mr. Keymer joined Popeyes in June 2004 as President and was
promoted to AFC's Chief Executive Officer in September 2005.
Since that time, Mr. Keymer has been instrumental in re-
energizing the Popeyes brand. Some of his many accomplishments
while with AFC and Popeyes include assembling an experienced
management team, accelerating new restaurant opening growth,
strengthening franchisee relations, improving operations
throughout the entire Popeyes system, and driving marketing
initiatives with food-focused advertising.
The AFC Board of Directors has engaged a leading executive
search firm to work with the company to find a new chief
executive with proven industry leadership.
The company also appointed Frederick B. Beilstein, former Chief
Financial Officer of AFC Enterprises from 2004-2005, as the
interim Chief Executive Officer effective upon Mr. Keymer's
departure. Mr. Beilstein has been a Managing Partner of
Equicorp Partners, LLC, an Atlanta-based investment and advisory
services firm since 2005. Mr. Beilstein has remained an active
consultant to AFC and the Popeyes brand since his departure.
His day-to-day responsibilities will include working with the
existing management team to oversee the execution of the
Company's operations.
AFC also announced the promotion of James W. Lyons, the
company's Chief Development Officer, to the newly created
position of Chief Operating Officer. Mr. Lyons joined the
Popeyes management team in July 2004 and he has played a key
role in improving the Company's development pipeline and
accelerating new restaurant openings. Mr. Lyons has more than
20 years experience in the restaurant industry. Prior to
joining Popeyes, Mr. Lyons held senior executive positions with
Burger King Corporation, Domino's Pizza, and Denny's
Corporation. Mr. Lyons holds a bachelor's of arts from the
State University of New York and a master's of business from
Adelphi University.
AFC CEO Kenneth Keymer stated, "Working on the Popeyes brand
with our talented and dedicated employees and franchisees has
been one of the most rewarding experiences in my life. Deciding
to resign was a very difficult decision, but I am at the point
where I wanted to devote more time to personal interests and
family considerations in Colorado. Today, the Popeyes' Brand is
well positioned, an experienced management team in place and our
franchisees are excited about the prospect for growth. I
believe Popeyes has unlimited potential to delight all of our
guests, investors and franchisees."
AFC Chairman Frank Belatti stated, "Ken has done an outstanding
job and we thank him for his many significant contributions to
the business over the past few years. We all wish him much
success in the future. Today the Popeyes brand is in an
excellent position and I am confident that the combined efforts
of Fred as our interim CEO, Jim as our new COO, and the rest of
the experienced management team, will continue to drive the
brand forward and deliver the operational performance the
company has previously projected for 2007."
Headquartered in Atlanta, Georgia, AFC Enterprises Inc. (Nasdaq:
AFCE) engages in the development, operation, and franchising of
quick-service restaurants. Its restaurants offer food and
beverage products. As of Dec. 25, 2005, the company operated
1,828 Popeyes restaurants in the United States, Puerto Rico,
Guam, and 24 foreign countries. The company was founded in
1972.
* * *
As reported in the Troubled Company Reporter-Latin America on
Oct. 27, 2006, in connection with Moody's Investors Service's
implementation of its new Probability-of-Default and Loss-Given-
Default rating methodology for the restaurant sector, the rating
agency revised its Corporate Family Rating for AFC Enterprises
Inc. from B1 to B2.
Additionally, Moody's affirmed its B1 ratings on the company's
US$190 million Guaranteed Senior Secured Term Loan B Due 5/2011
and US$60 million Guaranteed Senior Secured Revolver Due 5/2010.
Moody's assigned the debentures an LGD3 rating suggesting
lenders will experience a 31% loss in the event of default.
ALLIED WASTE: Tim Donovan Replaces Steven Helm as Gen'l Counsel
---------------------------------------------------------------
Allied Waste Industries Inc. has hired Timothy R. Donovan as
Executive Vice President, General Counsel and Corporate
Secretary. Mr. Donovan, who assumes his position on or about
April 11, 2007, replaces Steven M. Helm, who retired from the
company in August 2006. Mr. Donovan will report to John J.
Zillmer, Chairman and Chief Executive Officer.
"We are thrilled to welcome such an experienced professional to
our executive team," said Mr. Zillmer. "Tim brings a great
combination of outstanding legal expertise and broad business
skills. He will be a great asset as we continue to grow the
business and advance our key business strategies."
Prior to joining Allied, Mr. Donovan held various senior
positions with Tenneco Inc. from 1999 until his resignation,
most recently as Executive Vice President, Strategy and Business
Development, and General Counsel. Mr. Donovan served as a
member of Tenneco's Board of Directors beginning in March 2004.
Mr. Donovan was an attorney with the law firm of Jenner & Block
from 1982 until 1999, and was a partner in that firm and
chairman of its corporate and securities group.
Mr. Donovan is a director of John B. Sanfilippo & Son, Inc.,
where he is the Chairman of its Audit Committee and a member of
its Compensation Committee. Mr. Donovan holds a BS from Ohio
State University and he received his JD from Capital University.
Allied Waste North America, Inc., a wholly owned operating
subsidiary of Allied Waste Industries, Inc., is based in
Phoenix, Arizona. Allied Waste is a vertically integrated, non-
hazardous solid waste management company providing collection,
transfer, and recycling and disposal services for residential,
commercial and industrial customers. As of Dec. 31, 2006, the
company operated a network of 304 collection companies, 161
transfer stations, 168 active landfills and 57 recycling
facilities in 37 states and Puerto Rico. The company had
revenues of approximately US$6.0 billion in fiscal 2006.
* * *
As reported in the Troubled Company Reporter on Feb. 28, 2007,
Moody's Investors Service took these rating actions:
Allied Waste Industries, Inc.
-- Upgraded the Corporate Family Rating to B1 from B2;
-- Upgraded the Probability of Default Rating to B1 from B2;
-- Upgraded the US$230 million issue of 4.25% guaranteed
senior subordinated convertible bonds due 2034 to B3
(LGD 5, 87%) from Caa1 (LGD5, 85%);
-- Upgraded the US$600 million issue of 6.25% senior
mandatory convertible preferred stock -- conversion date
of March 2008 to B3 (LGD 6, 98%) from Caa1 (LGD6, 98%).
The Speculative Grade Liquidity Rating is SGL-1.
DORAL FINANCIAL: Pays Cash Dividend on Four Series of Stock
-----------------------------------------------------------
Doral Financial Corporation announced that, on Feb. 28, 2007, it
paid the regular monthly cash dividend on the company's:
-- 7% Non-cumulative Monthly Income Preferred Stock,
Series A, in the amount of US$0.2917 per share;
-- 8.35% Non-cumulative Monthly Income Preferred Stock,
Series B, in the amount of US$0.173958 per share; and
-- 7.25% Non-cumulative Monthly Income Preferred Stock,
Series C, in the amount of US$0.151042 per share.
The dividend on each of the series was paid to the record
holders as of the close of business on Feb. 26, 2007, in the
case of the Series A Preferred Stock, and to the record holders
as of the close of business on Feb. 15, 2007, in the case of
Series B and Series C Preferred Stock.
Based in New York City, Doral Financial Corp. (NYSE: DRL) --
http://www.doralfinancial.com/-- is a diversified financial
services company engaged in mortgage banking, banking,
investment banking activities, institutional securities and
insurance agency operations. Its activities are principally
conducted in Puerto Rico and in the New York City metropolitan
area. Doral is 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-Latin America on
Jan. 8, 2007, Moody's Investors Service downgraded to B2 from B1
the senior debt ratings of Doral Financial Corp. Moody's said
the ratings are on review for possible downgrade.
Downgrades:
Issuer: Doral Financial Corp.
-- Senior Unsecured Regular Bond/Debenture, Downgraded
to B2 from B1.
Outlook Actions:
Issuer: Doral Financial Corp.
-- Outlook, Changed To Rating Under Review From Negative.
* * *
As reported in the Troubled Company Reporter-Latin America on
Jan. 8, 2007, Standard & Poor's Ratings Services lowered its
long-term ratings on Doral Financial Corp., including the
counterparty credit rating, to 'B' from 'B+'.
Standard & Poor's said the outlook remains negative.
FIRST BANCORP: Board Declares Preferred Dividends Payment
---------------------------------------------------------
First BanCorp's Board of Directors has declared the next payment
of dividends on Common, Series A through E Preferred and Trust
Preferred I & II shares. Common stockholders of record as of
March 15, 2007, will receive the 47th consecutive quarterly
dividend payment declared by First BanCorp's Board, in the
amount of US$0.07 per share for the 1st Quarter of 2007, payable
on March 30, 2007.
The estimated dividend amounts per share, record dates and
payment dates for the Series A through E Preferred Shares are:
Series $Per/share Record Date Payment Date
------ ---------- ----------- ------------
A 0.1484375 March 29, 2007 April 2, 2007
B 0.17395833 March 15, 2007 April 2, 2007
C 0.1541666 March 15, 2007 April 2, 2007
D 0.15104166 March 15, 2007 April 2, 2007
E 0.14583333 March 15, 2007 April 2, 2007
Approval was obtained as a part of First BanCorp's previously
announced agreement with the Board of Governors of the Federal
Reserve System.
First BanCorp (NYSE: FBP) -- http://www.firstbankpr.com/-- is
the parent corporation of FirstBank Puerto Rico, a state
chartered commercial bank with operations in Puerto Rico, the
Virgin Islands and Florida; of FirstBank Insurance Agency; and
of Ponce General Corporation. First BanCorp, FirstBank Puerto
Rico and FirstBank Florida, formerly UniBank, the thrift
subsidiary of Ponce General, all operate within U.S. banking
laws and regulations.
* * *
As reported in the Troubled Company Reporter-Latin America on
Feb. 23, 2007, Fitch Ratings has affirmed First BanCorp's long-
term Issuer Default Rating of 'BB' and Individual rating of
'C/D' and removed the Rating Watch Negative. The Rating Outlook
is Negative. Fitch placed the ratings of First BanCorp on
Rating Watch Negative on Oct. 30, 2006. Fitch is affirming the
IDR and short-term rating of FBP's subsidiary, FirstBank of
Puerto Rico at 'BB' and 'B', respectively. The Rating Outlook
remains Negative.
HERTZ CORP: Plans Additional 1,350 Job Cuts, Mostly in the U.S.
---------------------------------------------------------------
Hertz Corp. plans to eliminate another 1,350 jobs, mainly in car
rental operations in the U.S., as well as Canada, Puerto Rico,
Brazil, Australia, and New Zealand, the Associated Press
reports.
The company revealed that it hopes to save US$125 million in
wages and similar costs annually as a result of the latest cuts,
Bloomberg News relates.
According to published reports, the company expects the layoffs
to result in a charge of US$9 million to US$11 million for
severance costs in the first quarter of 2007.
News about the most recent cuts emerged less than two months
after parent company Hertz Global Holdings Inc. disclosed plans
to lay off 200 workers.
As reported in TCR-Europe on Jan. 12, Hertz Global Holdings said
that the targeted job reductions are intended to help streamline
decision-making and improve service, in part by de-layering
management in several departments.
The parent company anticipates incurring an estimated US$3.3
million-US$3.8 million restructuring charge for severance and
related costs that will be taken in the first quarter of 2007.
About Hertz Global Holdings, Inc.
Hertz Global Holdings, Inc., the indirect parent corporation of
The Hertz Corp., is the largest worldwide general use car rental
brand and one of the largest equipment rental businesses in the
United States. In its car rental business segment, Hertz and
its independent licensees and associates accept reservations for
car rentals at about 7,600 locations in approximately 145
countries.
About Hertz Corp.
Headquartered in Park Ridge, New Jersey, Hertz Corp. --
http://www.hertz.com/-- is a car rental company that operates
from approximately 7,600 locations in 145 countries worldwide.
Hertz also operates an equipment rental business, Hertz
Equipment Rental Corporation, offering a diverse line of
equipment, including tools and supplies, as well as new and used
equipment for sale, to customers ranging from major industrial
companies to local contractors and consumers through more than
360 branches in the United States, Canada, France, and Spain.
Hertz has operations in the Philippines, Hungary, and Peru,
among others.
* * *
As reported in the TCR-Europe on Nov. 24, Moody's Investors
Service changed the rating outlook of The Hertz Corp. to stable
from negative following the completion of a US$1.3 billion IPO
by Hertz Global Holdings, Inc., the acquisition vehicle through
which equity sponsors Clayton, Dubilier & Rice, Inc., The
Carlyle Group and Merrill Lynch Global Private Equity acquired
Hertz in December 2005.
In a TCR-Europe report on Feb. 14, Standard & Poor's Ratings
Services affirmed its bank loan and recovery ratings on Hertz
Corp.'s senior secured bank facility at BB+/BB. S&P also
affirmed the company's Corporate Credit Rating at BB-/Negative/.
=================
V E N E Z U E L A
=================
DAIMLERCHRYSLER AG: Chrysler Eyes Sale of Dodge Cars in China
-------------------------------------------------------------
Chrysler Group, the troubled U.S. unit of DaimlerChrysler AG,
will start selling Dodge cars in China to further tap demand and
increase market share in the country, Bloomberg News reports.
Chrysler will introduce a Dodge model, three Jeep models and one
Chrysler vehicle in China this year. Chrysler sold 1,477 cars
in January, up 81% from the same period in 2006.
The company will also start the production of its Chrysler
Sebring sedans at its joint venture in Beijing at end-2007,
Trevor Hale, a DaimlerChrysler spokesman in China, told
Bloomberg News.
The company's profitable Mercedes-Benz unit, meanwhile,
currently trails behind Audi and BMW, which have been in China
for around two years. Mercedes-Benz sold 2,700 units in
January, up 64% from the same period in 2006, Bloomberg News
relays.
DaimlerChrysler and its partners are investing EUR1.5 billion in
China to increase capacity and hike its market share. The
company opened a manufacturing site with 105,000-unit capacity
in Beijing in September 2006. The site could produce up to
25,000 Mercedes-Benz E-Class and C-Class sedans annually, as
well as Chrysler and Mitsubishi Motor vehicles.
About DaimlerChrysler
Headquartered in Stuttgart, Germany, DaimlerChrysler AG --
http://www.daimlerchrysler.com/-- develops, manufactures,
distributes, and sells various automotive products, primarily
passenger cars, light trucks, and commercial vehicles worldwide.
It primarily operates in four segments: Mercedes Car Group,
Chrysler Group, Commercial Vehicles, and Financial Services.
The company's worldwide locations are located in: Canada,
Mexico, United States, Argentina, Brazil, Venezuela, China,
India, Indonesia, Japan, Thailand, Vietnam and Australia.
The Chrysler Group segment offers cars and minivans, pick-up
trucks, sport utility vehicles, and vans under the Chrysler,
Jeep, and Dodge brand names. It also sells parts and
accessories under the MOPAR brand.
The Chrysler Group is facing a difficult market environment in
the United States with excess inventory, non-competitive legacy
costs for employees and retirees, continuing high fuel prices
and a stronger shift in demand toward smaller vehicles. At the
same time, key competitors have further increased margin and
volume pressures -- particularly on light trucks -- by making
significant price concessions. In addition, increased interest
rates caused higher sales & marketing expenses.
In order to improve the earnings situation of the Chrysler Group
as quickly and comprehensively, measures to increase sales and
cut costs in the short term are being examined at all stages of
the value chain, in addition to structural changes being
reviewed as well.
ELECTRICIDAD DE CARACAS: AES Inks Definitive Pact for Stake Sale
----------------------------------------------------------------
The AES Corp. has entered into a definitive agreement with
Petroleos de Venezuela S.A. for the purchase of AES Corp.'s
82.14% stake in C.A. La Electricidad de Caracas for
approximately US$739 million.
AES Corp. expects to receive its share of a dividend, which will
provide up to US$98.6 million, following its conversion from
Bolivares into US Dollars. As a result of this sale, the
company expects to record a pre-tax, non-cash charge in the
range of US$550 to US$650 million in the first quarter of 2007.
About Petroleos de Venezuela
Petroleos de Venezuela is the state-owned oil company of the
Bolivarian Republic of Venezuela.
About AES Corp.
AES Corp. (NYSE:AES) -- http://www.aes.com/-- is a global power
company. The company operates in South America, Europe, Africa,
Asia and the Caribbean countries. Generating 44,000 megawatts
of electricity through 124 power facilities, the company
delivers electricity through 15 distribution companies.
About Electricidad de Caracas
Electricidad de Caracas is the largest private-sector electric
utility in Venezuela and generates, transmits, distributes, and
markets electricity primarily to metropolitan Caracas and its
surrounding areas. The AES Corp. owns 86% of EDC and acquired
its stake in June 2000, through a public-tender offer.
* * *
As reported in the Troubled Company Reporter-Latin America on
Feb. 16, 2007, Standard & Poor's Ratings Services revised the
CreditWatch implications for its 'B' foreign currency corporate
credit rating on C.A. La Electricidad de Caracas to developing
from negative. Standard & Poor's also revised the CreditWatch
implications for its 'B' senior unsecured debt rating on
Electricidad de Caracas Finance B.V.'s notes due 2014 to
developing from negative.
PETROLEOS DE VENEZUELA: AES Inks Definitive Pact for Stake Sale
---------------------------------------------------------------
The AES Corp. has entered into a definitive agreement with
Petroleos de Venezuela S.A. for the purchase of AES Corp.'s
82.14% stake in C.A. La Electricidad de Caracas for
approximately US$739 million.
AES Corp. expects to receive its share of a dividend, which will
provide up to US$98.6 million, following its conversion from
Bolivares into US Dollars. As a result of this sale, the
company expects to record a pre-tax, non-cash charge in the
range of US$550 to US$650 million in the first quarter of 2007.
About Electricidad de Caracas
Electricidad de Caracas is the largest private-sector electric
utility in Venezuela and generates, transmits, distributes, and
markets electricity primarily to metropolitan Caracas and its
surrounding areas. The AES Corp. owns 86% of EDC and acquired
its stake in June 2000, through a public-tender offer.
About AES Corp.
AES Corp. (NYSE:AES) -- http://www.aes.com/-- is a global power
company. The company operates in South America, Europe, Africa,
Asia and the Caribbean countries. Generating 44,000 megawatts
of electricity through 124 power facilities, the company
delivers electricity through 15 distribution companies.
Petroleos de Venezuela SA -- http://www.pdv.com/-- is
Venezuela's state oil company in charge of the development of
the petroleum, petrochemical and coal industry, as well as
planning, coordinating, supervising and controlling the
operational activities of its divisions, both in Venezuela and
abroad. The company has a commercial office in China.
* * *
As reported on Nov. 22, 2006, Fitch affirmed the local and
foreign currency Issuer Default Ratings of Petroleos de
Venezuela S.A. at 'BB-'. Fitch has also affirmed the 'AAA(ven)'
national scale rating of the company. Fitch said the rating
outlook is stable.
* VENEZUELA: Expects Demand for South Bonds to Reach US$12 Bil.
---------------------------------------------------------------
The Venezuelan Bank of the Treasury has estimated that the so-
called South Bonds would generate US$12 billion in sales,
although authorities are issuing US$1.5 in bonds only, El
Universal reports. As a result, around 87.5% of demand will not
be met.
According to Blagdimir Labrador, Chairman of the Bank of the
Treasury, there are at least 330,000 investors who applied to
buy the second edition of the South Bonds.
Mr. Labrador told El Universal that 56,000 investors took part
in the first bidding process. However, the Bank estimated that
figure six or eight times.
El Universal relates that Mr. Labrador identified the issue as
"absolutely sucessful" due to the democratization of investment.
The Ministry of Finance disclosed that the joint issue of the
Bond of the South II would be payable in bolivars. The issue
would also comprises joint sale at one single price of covered
interest and capital titles that are US dollar-denominated
Venezuelan debt bonds maturing in 2009 with a 5.25% yield and
Argentinean Boden 15 with a fixed yield of 7.00%.
Bids to buy the Bonds of the South, El Universal says, were
accepted from Feb. 26 to March 1.
* * *
As reported in the Troubled Company Reporter on Nov. 20, 2006,
Fitch Ratings affirmed Venezuela's long-term foreign and local
currency Issuer Default Ratings at 'BB-'. At the same time, the
agency also affirmed the short-term foreign currency IDR at 'B'
and the Country Ceiling at 'BB-'. Fitch said the outlook on the
ratings remains stable.
* VENEZUELA: Ministry Denies Shortage of Industrial Supplies
------------------------------------------------------------
Venezuela's Ministry of Light Industry and Trade denied to news
daily Prensa Latina any shortage of national industrial supplies
for those with the necessary authorization to acquire the
resources.
Since December 2006, about 5,600 certificates have been
requested to endorse the imports. Some 5,400 of them were
granted within 10 days, local press says, citing Minister Maria
Cristina Iglesias.
Minister Iglesias told Prensa Latina that since 200 requests are
unresolved, assertions on shortage of inputs serve those seeking
social destabilization and elimination of control procedures to
the loss of national industry.
The Venezuelan government is has an obligation to protect the
development and diversification of the nation's enterprises. It
is then important to have norms regulating the 1,600 odd tax
codes, Prensa Latina notes, citing Minister Iglesias.
"No vehicle assembly factory will be paralyzed in Venezuela,"
Minister Iglesias assured Prensa Latina.
The minister asked the media and industries not to spread wrong
information that will destabilize the good development of
Venezuela, Prensa Latina states.
* * *
As reported in the Troubled Company Reporter on Nov. 20, 2006,
Fitch Ratings affirmed Venezuela's long-term foreign and local
currency Issuer Default Ratings at 'BB-'. At the same time, the
agency also affirmed the short-term foreign currency IDR at 'B'
and the Country Ceiling at 'BB-'. Fitch said the outlook on the
ratings remains stable.
* VENEZUELA: Resumption of Alunasa's Operations Temporary
---------------------------------------------------------
Venezuelan President Hugo Chavez told A.M. Costa Rica that the
decision to continue supplying aluminum raw material to Alunasa,
the Costa Rican subsidiary of Venezuela's state heavy industry
holding Corporacion Venezolana de Guyana, was temporary.
Some Venezuelan officials will visit Costa Rica to evaluate
Alunasa, A.M. Costa Rica relates, citing President Chavez.
As reported in the Troubled Company Reporter-Latin America on
March 2, 2007, President Chavez decided not to shut down Alunasa
after a meeting with workers from the firm. President Chavez
had decided to close down Alunasa and relocate it to Nicaragua
due to geopolitical, technical and economic reasons, contrary to
what reports said that the closure was caused by his political
spat with Costa Rican President Oscar Arias. President Arias
had said that the special powers granted to President Chavez
were "the antithesis of democracy." The statement allegedly
offended President Chavez, who then ordered the immediate
suspension of his country's aluminum shipments to Costa Rica.
That decision was also taken back.
A.M. Costa Rica relates that President Arias responded as if the
decision to continue Alunasa's operations and aluminum shipments
to Costa Rica was final.
President Arias told A.M. Costa Rica that he is glad that
Alunasa won't be shut down.
* * *
As reported in the Troubled Company Reporter on Nov. 20, 2006,
Fitch Ratings affirmed Venezuela's long-term foreign and local
currency Issuer Default Ratings at 'BB-'. At the same time, the
agency also affirmed the short-term foreign currency IDR at 'B'
and the Country Ceiling at 'BB-'. Fitch said the outlook on the
ratings remains stable.
* BOND PRICING: For the Week February 26 to March 2, 2007
-------------------------------------------------------------
Issuer Coupon Maturity Currency Price
------ ------ -------- -------- -----
ARG Boden 2.000 9/30/08 ARS 55.1661
Argent-Par 0.630 12/31/38 ARS 58.1667
Gov't of Belize 9.500 9/15/12 USD 73.0000
Gov't of Belize 9.750 6/12/15 USD 67.0000
Colombia TES 4.750 2/23/23 COP 60.1233
Vontobel Cayman 10.700 12/28/07 CHF 72.7000
Vontobel Cayman 11.850 12/28/07 CHF 74.7000
Vontobel Cayman 22.850 12/28/07 CHF 55.2000
***********
S U B S C R I P T I O N I N F O R M A T I O N
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