/raid1/www/Hosts/bankrupt/TCRLA_Public/080227.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
Wednesday, February 27, 2008, Vol. 9, No. 41
Headlines
A R G E N T I N A
ARTES GRAFICAS: Proofs of Claim Verification Ends on April 9
BEATRICE MARKETS: Proofs of Claim Verification Ends on May 14
BLANCA NIEVES: Proofs of Claim Verification Ends on March 12
CALDERON NILDA: Proofs of Claim Verification Ends on March 31
COLETOUR TRANSPORTE: Claims Verification Ends on March 27
DANA CORP: Reorganized Company Names Directors and Officers
FORD MOTOR: To Disclose Deal With Tata Motors on March 6 or 7
GREIF INC: Board Declares US$0.28 Per Share Class A Dividends
GREIF INC: Stockholders Elect Mark A. Emkes as Director
IDS SA: Trustee Will Verify Proofs of Claim Until April 16
KUSHAN SRL: Proofs of Claim Verification Is Until March 28
LOGISTICA Y TRANSPORTE: Trustee to Verify Claims Until April 30
MONROE 2444: Files Reorganization Petition
RULLO AUTOMOTORES: Proofs of Claim Verification Ends on April 10
SACOM SA: Files Reorganization Petition
SERRA LISANDRO: Proofs of Claim Verification Is Until March 31
TELEFONICA DE ARGENTINA: Earns ARS72 Million in 2007
TELEFONICA DE ARGENTINA: Installs Communication Software for DHL
B E R M U D A
FOSTER WHEELER: Closes Biokinetics Acquisition
GP INVESTMENTS: Raises US$187.8 Million in New Share Sale
INTELSAT LTD: Partners With SISLink to Launch HD-Ready Service
REFCO INC: SEC Sues Ex-CEO Bennett for Orchestrating Fraud
REFCO INC: Ex-Finance Chief Robert Trosten Admits Fraud Charges
B R A Z I L
AMERICAN AXLE: Declares First Qtr. Dividend Payable on March 28
BANCO DO BRASIL: Mulls Increasing Retail Operations in LatAm
BANCO NACIONAL: Approves BRL32-Million Financing to Fundacao
BRASIL TELECOM: Inks O&M Services Deal With Alcatel-Lucent
BROWN SHOE: Richard Schumacher to Retire Effective March 31
CAIXA ECONOMICA: To Increase Lending by 30% This Year
DELPHI CORP: Must Pay Professionals US$49 Mln in Fees & Expenses
GENERAL MOTORS: Inks Settlement Pact With UAW and Union Retirees
GERDAU SA: Cleary Holdings Acquisition Good for Firm, Says Ativa
PERDIGAO SA: Net Income Rises 174% to BRL321.3 Million in 2007
PRIDE INTERNATIONAL: Closes Sale of Three Rigs for US$213 Mil.
PRIDE INTERNATIONAL: Names David Hager to Board of Directors
UNIAO DE BANCOS: To Expand Points of Sale Network by 400 Units
C A Y M A N I S L A N D S
AH INC: Proofs of Claim Filing Is Until March 6
ARIANE HEALTH: Proofs of Claim Filing Deadline Is March 6
CHENGWEI AAC: Sets Final Shareholders' Meeting for March 6
PARIS HOTEL: Proofs of Claim Filing Deadline Is March 6
THE AIDA C FUND LIMITED: Proofs of Claim Filing Ends on March 6
C H I L E
BUCYRUS INTERNATIONAL: Amends RAG Coal Share Purchase Deal
HOST HOTELS: Fitch to Monitor Impact of $500MM Stock Repurchase
C O L O M B I A
ECOPETROL: Investing US$38 Billion for Exploration & Production
SOLUTIA INC: Drops Suit After Banks Recommit on Exit Financing
SOLUTIA INC: Court Delays Ruling on Citigroup CEO's Deposition
SOLUTIA INC: Gets Exit Financing; To Emerge Tomorrow
C O S T A R I C A
SIRVA INC: U.S. Trustee Appoints Unsecured Creditors' Committee
SIRVA INC: Planned Conflicts Firm Rebuts US Trustee's Objection
SIRVA INC: 360networks Committee Wants Claims Order Vacated
D O M I N I C A N R E P U B L I C
PRC LLC: Creditors Panel Wants More Time to Review DIP Financing
PRC LLC: Inks Pact Recognizing Law Debenture as Collateral Agent
PRC LLC: Court Okays Services Agreement With Advanced Contact
E C U A D O R
PETROECUADOR: Sells Oriente & Napo Crude in Short-Term Contracts
E L S A L V A D O R
ALCATEL-LUCENT SA: Inks O&M Services Deal With Brasil Telecom
G U Y A N A
FLOWSERVE CORP: Inks Strategic Cooperation Deal With Sinopec
J A M A I C A
CABLE & WIRELESS: Will Dismiss 100 Workers in Jamaica
NATIONAL WATER: Says Hermitage Dam Water Storage Levels Drop
M E X I C O
ARROW ELECTRONICS: Inks Pact to Buy All of LOGIX Shares
AXTEL SAB: Posts MXN81.6 million Comprehensive Loss in 4th Qtr.
DURA AUTOMOTIVE: Court OKs Amendments to Revolving DIP Debt Pact
DURA AUTOMOTIVE: Must Appear at Final Hearing to OK Bonus Plan
EPICOR SOFTWARE: Borrows US$160 Mil. to Finance NSB Acquisition
FOAMEX INTERNATIONAL: Expects Unit to Comply With Covenants
ODYSSEY RE: Hires Brian Young as CEO for London Market Division
WEST CORP: Plans to Purchase Genesys for US$269 Million
P E R U
QUEBECOR WORLD: Auction Prices Bonds at 41.25%
QUEBECOR WORLD: Court Okays Payment of Prepetition Commissions
QUEBECOR WORLD: Various Entities Disclose Stake in Company
P U E R T O R I C O
AVNET INC: Moody's Lifts Corporate Family Rating to Baa3
COOPER COMPANIES: Appoints John Weber as CooperVision President
FOOT LOCKER: Allowable Dividend Payments Increased to US$95 Mil.
MYLAN INC: Taps E. Leeds as VP & Global Investor Relations Head
SUNCOM WIRELESS: Concludes Sale to T-Mobile
V E N E Z U E L A
PETROLEOS DE VENEZUELA: Receivables Under Pacts Up US$310 Mil.
PETROLEOS DE VENEZUELA: Offers to Withdraw Stake in Chalmette
V I R G I N I S L A N D S
INNOVATIVE COMM: To Auction Innovative Telephone This Year
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=================
A R G E N T I N A
=================
ARTES GRAFICAS: Proofs of Claim Verification Ends on April 9
------------------------------------------------------------
Atilio Mossi, the court-appointed trustee for Artes Graficas
Patagonia SRL's bankruptcy proceeding, will be verifying
creditors' proofs of claim until April 9, 2008.
Mr. Mossi will present the validated claims in court as
individual reports. The National Commercial Court of First
Instance No. 26 in Buenos Aires, with the assistance of Clerk
No. 51, will determine if the verified claims are admissible,
taking into account the trustee's opinion, and the objections
and challenges that will be raised by Artes Graficas 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 Artes Graficas'
accounting and banking records will be submitted in court.
La Nacion didn't state the submission deadlines of the reports.
Mr. Mossi is also in charge of administering Artes Graficas'
assets under court supervision and will take part in their
disposal to the extent established by law.
The debtor can be reached at:
Artes Graficas Patagonia SRL
Patron 6041
Buenos Aires, Argentina
The trustee can be reached at:
Atilio Mossi
Montevideo 527
Buenos Aires, Argentina
BEATRICE MARKETS: Proofs of Claim Verification Ends on May 14
-------------------------------------------------------------
Jorge Vazquez, the court-appointed trustee for Beatrice Markets
SRL's bankruptcy proceeding, will be verifying creditors' proofs
of claim until May 14, 2008.
Mr. Vazquez will present the validated claims in court as
individual reports. The National Commercial Court of First
Instance No. 2 in Buenos Aires, with the assistance of Clerk No.
3, will determine if the verified claims are admissible, taking
into account the trustee's opinion, and the objections and
challenges that will be raised by Beatrice Markets 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 Beatrice Markets'
accounting and banking records will be submitted in court.
La Nacion didn't state the submission deadlines of the reports.
Mr. Vazquez is also in charge of administering Beatrice Markets'
assets under court supervision and will take part in their
disposal to the extent established by law.
The debtor can be reached at:
Beatrice Markets SRL
Pasaje Torrent 1273
Buenos Aires, Argentina
The trustee can be reached at:
Jorge Vazquez
Bartolome Mitre 2593
Buenos Aires, Argentina
BLANCA NIEVES: Proofs of Claim Verification Ends on March 12
------------------------------------------------------------
Roberto Leibovicius, the court-appointed trustee for Blanca
Nieves SRL's bankruptcy proceeding, will be verifying creditors'
proofs of claim until March 12, 2008.
Mr. Leibovicius will present the validated claims in court as
individual reports. The National Commercial Court of First
Instance No. 23 in Buenos Aires, with the assistance of Clerk
No. 45, will determine if the verified claims are admissible,
taking into account the trustee's opinion, and the objections
and challenges that will be raised by Blanca Nieves 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 Blanca Nieves'
accounting and banking records will be submitted in court.
La Nacion didn't state the submission deadlines of the reports.
Mr. Leibovicius is also in charge of administering Blanca
Nieves' assets under court supervision and will take part in
their disposal to the extent established by law.
The debtor can be reached at:
Blanca Nieves SRL
Lafinur 3190
Buenos Aires, Argentina
The trustee can be reached at:
Roberto Leibovicius
Tucuman 1585
Buenos Aires, Argentina
CALDERON NILDA: Proofs of Claim Verification Ends on March 31
-------------------------------------------------------------
Leandro Andres Pretto, the court-appointed trustee for the
bankruptcy proceeding of Calderon Nilda Mercedes (s/Extension de
Quiebra de Durante y Cia. S.C.C.), will be verifying creditors'
proofs of claim until March 31, 2008.
Mr. Pretto will present the validated claims in court as
individual reports on May 15, 2008. The National Commercial
Court of First Instance in Santa Fe will determine if the
verified claims are admissible, taking into account the
trustee's opinion, and the objections and challenges that will
be raised by Calderon Nilda 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 Calderon Nilda's
accounting and banking records will be submitted in court on
June 27, 2008.
Mr. Pretto is also in charge of administering Calderon Nilda's
assets under court supervision and will take part in their
disposal to the extent established by law.
The debtor can be reached at:
Calderon Nilda Mercedes
Sarmiento 1113, Carcarana
Departamento San Lorenzo, Santa Fe
Argentina
COLETOUR TRANSPORTE: Claims Verification Ends on March 27
---------------------------------------------------------
Beatriz Dominguez, the court-appointed trustee for Coletour
Transporte SRL's bankruptcy proceeding, will be verifying
creditors' proofs of claim until March 27, 2008.
Ms. Dominguez will present the validated claims in court as
individual reports. The National Commercial Court of First
Instance No. 24 in Buenos Aires, with the assistance of Clerk
No. 47, will determine if the verified claims are admissible,
taking into account the trustee's opinion, and the objections
and challenges that will be raised by Coletour Transporte 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 Coletour Transporte's
accounting and banking records will be submitted in court.
La Nacion didn't state the submission deadlines of the reports.
Ms. Dominguez is also in charge of administering Coletour
Transporte's assets under court supervision and will take part
in their disposal to the extent established by law.
The debtor can be reached at:
Coletour Transporte SRL
Suipacha 536
Buenos Aires, Argentina
The trustee can be reached at:
Beatriz Dominguez
Avenida Rivadavia 2159
Buenos Aires, Argentina
DANA CORP: Reorganized Company Names Directors and Officers
-----------------------------------------------------------
Dana Holding Corporation, successor to Dana Corporation, said in
a regulatory filing with the U.S. Securities and Exchange
Commission that it has appointed nine individuals to its Board
of Directors:
* Michael J. Burns,
* Gary L. Convis,
* John M. Devine,
* Mark T. Gallogly,
* Richard A. Gephardt,
* Stephen J. Girsky,
* Terrence J. Keating,
* Mark A. Schulz, and
* Jerome B. York.
Subsequent to his election as member of the Board, on the
Effective Date, Mr. Burns tendered his resignation as president,
chief executive officer, chief operating officer and director,
the SEC filing said.
On Jan. 31, 2008, when the Third Amended Joint Plan of
Reorganization of Old Dana and its debtor-affiliates effective,
other former members of the Old Dana Board also resigned
pursuant to the terms of the Plan. These resigned members are
A. Charles Baillie, David E. Berges, Edmund M. Carpenter,
Richard M. Gabrys, Samir G. Gibara, Cheryl W. Grise, James P.
Kelly, Marilyn R. Marks and Richard B. Priory.
Executive Officers
On the Effective Date, Dana named John M. Devine as the
company's executive chairman, and elected other executive
officers:
Executive Officer Position
----------------- --------
John M. Devine Executive Chairman
Michael J. Burns President, Chief Executive Officer, and
Chief Operating Officer
Kenneth A. Hiltz Chief Financial Officer
Richard J. Dyer Vice President & Chief Accounting Officer
Ralf Goettel President, Europe & Engine Products
Groups
Paul E. Miller Vice President, Purchasing
Nick L. Stanage President, Heavy Vehicle Products
Thomas R. Stone President, Global Traction Products Group
Robert H. Marcin Chief Administrative Officer
In connection with his appointment as Dana's Executive Chairman,
the Compensation Committee agreed to provide Mr. Devine:
-- a US$1,000,000 annual salary;
-- an annual target bonus of 150% of base salary based on the
achievement of performance measures set by the Board;
-- an initial grant of options to purchase 800,000 shares of
Common Stock with an exercise price of US$12.75 based on
the closing stock price on the grant date, one third of
which will vest on each of Aug. 4, 2008, Aug. 4, 2009 and
Aug. 4, 2010;
-- an initial term of one year, subject to renewal for
additional one-year terms;
-- reimbursement for reasonable temporary residence expenses
including use of private corporate aircraft up to 30 round
trips;
-- inclusion in future change of control agreements; and
-- participation in life and disability insurance and other
benefit programs of Dana generally applicable to senior
executives.
According to Marc S. Levin, Dana's general counsel and
secretary, Mr. Devine's employment agreement will provide for
severance payments in the event that his position with the
company is involuntarily terminated without cause or terminated
by Mr. Devine for "good reason," as well as payments following a
change in control of the company.
Indemnification Agreements
Dana also entered into an indemnification agreement with each
current member of the company's Board of Directors. The
Indemnification Agreements generally provide that the company
will indemnify the D&O to the fullest extent permitted or
required by the laws of the state of Delaware, against any and
all expenses, judgments, fines, penalties and amounts paid in
settlement of the claim.
About Dana Corp.
Based in Toledo, Ohio, Dana Corporation -- http://www.dana.com/
-- designs and manufactures products for every major vehicle
producer in the world, and supplies drivetrain, chassis,
structural, and engine technologies to those companies. Dana
employs 46,000 people in 28 countries. Dana is focused on being
an essential partner to automotive, commercial, and off-highway
vehicle customers, which collectively produce more than 60
million vehicles annually.
Dana has facilities in China in the Asia-Pacific, Argentina in
the Latin-American regions and Italy in Europe.
The company and its affiliates filed for chapter 11 protection
on March 3, 2006 (Bankr. S.D.N.Y. Case No. 06-10354). As of
Nov. 30, 2007, the Debtors listed US$7,131,000,000 in total
assets and US$7,665,000,000 in total debts resulting in a total
shareholders' deficit of US$534,000,000.
Corinne Ball, Esq., and Richard H. Engman, Esq., at Jones Day,
in Manhattan and Heather Lennox, Esq., Jeffrey B. Ellman, Esq.,
Carl E. Black, Esq., and Ryan T. Routh, Esq., at Jones Day in
Cleveland, Ohio, represented the Debtors. Henry S. Miller at
Miller Buckfire & Co., LLC, served as the Debtors' financial
advisor and investment banker. Ted Stenger from AlixPartners
served as Dana's Chief Restructuring Officer.
Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel
LLP, represented the Official Committee of Unsecured Creditors.
Fried, Frank, Harris, Shriver & Jacobson, LLP served as counsel
to the Official Committee of Equity Security Holders. Stahl
Cowen Crowley, LLC served as counsel to the Official Committee
of Non-Union Retirees.
The Debtors filed their Joint Plan of Reorganization on
Aug. 31, 2007. On Oct. 23, 2007, the Court approved the
adequacy of the Disclosure Statement explaining their Plan.
Judge Burton Lifland of the U.S. Bankruptcy Court for the
Southern District of New York entered an order confirming the
Third Amended Joint Plan of Reorganization of the Debtors on
Dec. 26, 2007.
The Debtors' Third Amended Joint Plan of Reorganization was
deemed effective as of Jan. 31, 2008. Dana Corp., starting on
the Plan Effective Date, operated as Dana Holding Corporation.
(Dana Corporation Bankruptcy News, Issue No. 71; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000)
* * *
As reported in the Troubled Company Reporter on Feb. 12, 2008,
Standard & Poor's Ratings Services assigned its 'BB-' corporate
credit rating to Toledo, Ohio-based Dana Holding Corp. following
the company's emergence from Chapter 11 on Feb. 1, 2008. The
outlook is negative.
At the same time, Standard & Poor's assigned Dana's US$650
million asset-based loan revolving credit facility due 2013 a
'BB+' rating (two notches higher than the corporate credit
rating) with a recovery rating of '1', indicating an expectation
of very high recovery in the event of a payment default. In
addition, S&P assigned a 'BB' bank loan rating to Dana's
US$1.43 billion senior secured term loan with a recovery rating
of '2', indicating an expectation of average recovery.
FORD MOTOR: To Disclose Deal With Tata Motors on March 6 or 7
-------------------------------------------------------------
Ford Motor Co. will announce the sale of its Jaguar and Land
Rover luxury brands to Tata Motors Limited on March 6 or 7,
media reports say.
Tata Motors became the front-runner to buy the two luxury
brands, outbidding Mahindra & Mahindra in collaboration with
buyout firm Apollo; and One Equity Partners LLC. As reported by
the Troubled Company Reporter-Asia Pacific on Feb. 1, 2008, Tata
Motors is closing in on an agreement with Ford for the purchase.
Last week, Tata and Ford met with British union leaders to
resolve final details before drawing up a memorandum of
understanding for the sale, AFX News said quoting a report by
Automotive News.
Media reports noted that the union is satisfied with Tata Motors
assuring them, among others, of keeping employment in the United
Kingdom at its current level.
To pave the way for the final takeover, Tata Motors will sign a
three-way Heads of Agreement with Ford and the Jaguar-Land Rover
labor union Unite within a few days, The Times of India said
citing Dave Osboerne, Motor Industry Leader for Unite. The HoA,
a tripartite document, would outline the assurances and
agreements reached among the three key players regarding the
deal, Mr. Osboerne told the news agency. The parties will also
enter into a final memorandum of understanding on the takeover
soon, The Times added.
Announcement of the deal could have been earlier than March 6
or 7, but it is being delayed so as not to overshadow the
introduction of an updated Ford Fiesta at the Geneva auto show
next week, Automotive News cited an unnamed source from Ford as
saying.
About Tata Motors
India's largest automobile company, Tata Motors Limited --
http://www.tatamotors.com/-- is mainly engaged in the business
of automobile products consisting of all types of commercial and
passenger vehicles, including financing of the vehicles sold by
the company. The Company's operating segments consists of
Automotive and Others. In addition to its automotive products,
it offers construction equipment, engineering solutions and
software operations. Tata Motors has operations in Russia and
the United Kingdom.
About Ford Motor
Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) --
http://www.ford.com/-- manufactures or distributes automobiles
in 200 markets across six continents. With about 260,000
employees and about 100 plants worldwide, the company's core and
affiliated automotive brands include Ford, Jaguar, Land Rover,
Lincoln, Mercury, Volvo, Aston Martin, and Mazda. The company
provides financial services through Ford Motor Credit Company.
The company has operations in Japan in the Asia Pacific region.
In Europe, the company maintains a presence in Sweden, and the
United Kingdom. The company also distributes its brands in
various Latin American regions, including Argentina and Brazil.
* * *
As reported in the Troubled Company Reporter-Latin America on
Feb. 15, 2008, Fitch Ratings affirmed the Issuer Default Ratings
of Ford Motor Company and Ford Motor Credit Company at 'B', and
maintained the Rating Outlook at Negative.
As reported in the Troubled Company Reporter on Nov. 19, 2007,
Moody's Investors Service affirmed the long-term ratings of Ford
Motor Company (B3 Corporate Family Rating, Ba3 senior secured,
Caa1 senior unsecured, and B3 probability of default), but
changed the rating outlook to Stable from Negative and raised
the company's Speculative Grade Liquidity rating to SGL-1 from
SGL-3. Moody's also affirmed Ford Motor Credit Company's B1
senior unsecured rating, and changed the outlook to Stable from
Negative. These rating actions follow Ford's announcement of
the details of the newly ratified four-year labor agreement with
the UAW.
GREIF INC: Board Declares US$0.28 Per Share Class A Dividends
-------------------------------------------------------------
The Board of Directors of Greif, Inc. has declared quarterly
cash dividends of US$0.28 per share of Class A Common Stock and
US$0.42 per share of Class B Common Stock. The dividends are
payable on April 1, 2008, to shareholders of record at close of
business on March 17, 2008.
Headquartered in Delaware, Ohio, Greif, Incorporated, (NYSE:
GEF, GEF.B) -- http://www.greif.com/-- is a world leader in
industrial packaging products and services. The company
provides extensive expertise in steel, plastic, fibre,
corrugated and multi-wall containers for a wide range of
industries. Greif also produces containerboard and manages
timber properties in the United States. For fiscal year 2006,
the company generated approximately US$2.6 billion in net sales
and US$326 million in EBITDA. The company has operations in
Australia, Argentina, Brazil, Belgium, China, Malaysia, among
others.
* * *
On Nov. 14, 2007, Moody's affirmed the company's Corporate
Family Rating at Ba1; Senior Unsecured at Ba2; and Speculative
Grade Liquidity of SGL-1 with stable rating outlook.
GREIF INC: Stockholders Elect Mark A. Emkes as Director
-------------------------------------------------------
At the Greif, Inc., annual meeting of stockholders on Feb. 25,
Mark A. Emkes was elected to a one-year term on Greif's Board of
Directors. Mr. Emkes joins re-elected members Vicki L. Avril,
Michael H. Dempsey, Bruce A. Edwards, Michael J. Gasser, Daniel
J. Gunsett, Judith D. Hook and Patrick J. Norton. John F. Finn,
also elected for a one-year term, was appointed to Greif's Board
in December.
Mr. Emkes is chairperson and chief executive officer of
Bridgestone Americas Holdings, Inc. and Bridgestone Firestone
North American Tire, LLC, based in Nashville, Tennessee.
Both Charles R. Chandler and William B. Sparks, Jr., did not
stand for re-election and have retired from the Board.
Headquartered in Delaware, Ohio, Greif, Incorporated, (NYSE:
GEF, GEF.B) -- http://www.greif.com/-- is a world leader in
industrial packaging products and services. The company
provides extensive expertise in steel, plastic, fibre,
corrugated and multi-wall containers for a wide range of
industries. Greif also produces containerboard and manages
timber properties in the United States. For fiscal year 2006,
the company generated approximately US$2.6 billion in net sales
and US$326 million in EBITDA. The company has operations in
Australia, Argentina, Brazil, Belgium, China, Malaysia, among
others.
* * *
On Nov. 14, 2007, Moody's affirmed the company's Corporate
Family Rating at Ba1; Senior Unsecured at Ba2; and Speculative
Grade Liquidity of SGL-1 with stable rating outlook.
IDS SA: Trustee Will Verify Proofs of Claim Until April 16
----------------------------------------------------------
Estudio Israelson y Kohan - Consultores, the court-appointed
trustee for IDS SA's reorganization proceeding, will be
verifying creditors' proofs of claim until April 16, 2008.
The trustee will present the validated claims in court as
individual reports. The National Commercial Court of First
Instance No. 25 in Buenos Aires, with the assistance of Clerk
No. 50, will determine if the verified claims are admissible,
taking into account the trustee's opinion, and the objections
and challenges that will be raised by IDS SA 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 IDS SA's accounting
and banking records will be submitted in court.
La Nacion didn't state the submission deadlines of the reports.
Creditors will vote to ratify the completed settlement plan
during the assembly on Feb. 4, 2009.
The debtor can be reached at:
IDS SA
Cervino 3707
Buenos Aires, Argentina
The trustee can be reached at:
Estudio Israelson y Kohan - Consultores
Lavalle 1672
Buenos Aires, Argentina
KUSHAN SRL: Proofs of Claim Verification Is Until March 28
----------------------------------------------------------
Maria Gabriela Diepenbrock, the court-appointed trustee for
Kushan S.R.L.'s bankruptcy proceeding, will be verifying
creditors' proofs of claim until March 28, 2008.
Ms. Diepenbrock will present the validated claims in court as
individual reports on May 13, 2008. The National Commercial
Court of First Instance in Santa Fe will determine if the
verified claims are admissible, taking into account the
trustee's opinion, and the objections and challenges that will
be raised by Kushan 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 Kushan's accounting
and banking records will be submitted in court on June 26, 2008.
Ms. Diepenbrock is also in charge of administering Kushan's
assets under court supervision and will take part in their
disposal to the extent established by law.
The trustee can be reached at:
Maria Gabriela Diepenbrock
Tucuman 1657
Buenos Aires, Argentina
LOGISTICA Y TRANSPORTE: Trustee to Verify Claims Until April 30
---------------------------------------------------------------
Jose Dolinko, the court-appointed trustee for Logistica y
Transporte SA's reorganization proceeding, will be verifying
creditors' proofs of claim until April 30, 2008.
Mr. Dolinko will present the validated claims in court as
individual reports. The National Commercial Court of First
Instance No. 7 in Buenos Aires, with the assistance of Clerk
No. 13, will determine if the verified claims are admissible,
taking into account the trustee's opinion, and the objections
and challenges that will be raised by Logistica y Transporte 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 Logistica y
Transporte's accounting and banking records will be submitted in
court.
La Nacion didn't state the submission deadlines of the reports.
Creditors will vote to ratify the completed settlement plan
during the assembly on Feb. 23, 2009.
The debtor can be reached at:
Logistica y Transporte SA
Parana 693
Buenos Aires, Argentina
The trustee can be reached at:
Jose Dolinko
Tucuman 1657
Buenos Aires, Argentina
MONROE 2444: Files Reorganization Petition
------------------------------------------
Monroe 2444 S.A. has requested for reorganization approval after
failing to pay its liabilities since Aug. 28, 2006.
The reorganization petition, once approved by the court, will
allow Monroe 2444 to negotiate a settlement with its creditors
in order to avoid a straight liquidation.
The case is pending in the National Commercial Court of First
Instance in Buenos Aires.
The debtor can be reached at:
Monroe 2444 S.A.
Monroe 2444
Buenos Aires, Argentina
RULLO AUTOMOTORES: Proofs of Claim Verification Ends on April 10
----------------------------------------------------------------
Emilio Omar Abraham, the court-appointed trustee for Rullo
Automotores S.A.'s bankruptcy proceeding, will be verifying
creditors' proofs of claim until April 10, 2008.
Mr. Abraham will present the validated claims in court as
individual reports on May 23, 2008. The National Commercial
Court of First Instance in Santa Fe will determine if the
verified claims are admissible, taking into account the
trustee's opinion, and the objections and challenges that will
be raised by Rullo Automotores 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 Rullo Automotores'
accounting and banking records will be submitted in court on
July 7, 2008.
Mr. Abraham is also in charge of administering Rullo
Automotores' assets under court supervision and will take part
in their disposal to the extent established by law.
The debtor can be reached at:
Rullo Automotores S.A.
Parana 123
Buenos Aires, Argentina
The trustee can be reached at:
Emilio Omar Abraham
Viamonte 1592
Buenos Aires, Argentina
SACOM SA: Files Reorganization Petition
---------------------------------------
Sacom S.A. has requested for reorganization approval after
failing to pay its liabilities since Oct. 19, 2007.
The reorganization petition, once approved by the court, will
allow Sacom to negotiate a settlement with its creditors in
order to avoid a straight liquidation.
The case is pending in the National Commercial Court of First
Instance No. 20 in Buenos Aires. Clerk No. 39 is assisting the
court in this case.
The debtor can be reached at:
Sacom S.A.
Bolivia 1305
Buenos Aires, Argentina
SERRA LISANDRO: Proofs of Claim Verification Is Until March 31
--------------------------------------------------------------
Leandro Andres Pretto, the court-appointed trustee for the
bankruptcy proceeding of Serra Lisandro Pablo (s/Extension de
Quiebra de Durante y Cia. S.C.C.), will be verifying creditors'
proofs of claim until March 31, 2008.
Mr. Pretto will present the validated claims in court as
individual reports on May 15, 2008. The National Commercial
Court of First Instance in Santa Fe will determine if the
verified claims are admissible, taking into account the
trustee's opinion, and the objections and challenges that will
be raised by Serra Lisandro 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 Serra Lisandro's
accounting and banking records will be submitted in court on
June 27, 2008.
Mr. Pretto is also in charge of administering Serra Lisandro's
assets under court supervision and will take part in their
disposal to the extent established by law.
The debtor can be reached at:
Serra Lisandro Pablo
Sarmiento 1113, Carcarana
Departamento San Lorenzo, Santa Fe
Argentina
TELEFONICA DE ARGENTINA: Earns ARS72 Million in 2007
----------------------------------------------------
Telefonica de Argentina said that its net profit decreased 67.5%
to ARS72 million in 2007, from 2006.
Business News Americas relates that Telefonica de Argentina's
net profit dropped 71% to ARS222 million in 2006, compared to
2005.
BNamericas notes that Telefonica de Argentina's net equity was
ARS2.2 billion in December 2007.
Telefonica de Argentina is concentrating on the expansion of its
broadband infrastructure. Its strategy is to look for
alternative sources of income other than traditional telephony.
The company will invest heavily in the launch of IPTV services
once the local regulator lets telecommunications operators offer
broadcasting services, BNamericas says, citing Fitch Ratings
analyst Sergio Rodriguez.
Telefonica de Argentina has a strong financial profile and has
been paying debt due to high free cash flow generation, Mr.
Rodriguez told BNamericas.
Headquartered in Buenos Aires, Argentina, Telefonica de
Argentina SA -- http://www.telefonica.com.ar/-- provides
telecommunication services, which include telephony business
both in Spain and Latin America, mobile communications
businesses, directories and guides businesses, Internet, data
and corporate services, audiovisual production and broadcasting,
broadband and Business-to-Business e-commerce activities.
* * *
As reported in the Troubled Company Reporter-Latin America on
Feb. 21, 2008, Fitch Ratings upgraded its local currency issuer
default rating on Telefonica de Argentina to 'BB' from 'BB-'.
The ratings agency also affirmed its 'B+' foreign currency
issuer default rating on the telecom firm.
Telefonica de Argentina's foreign currency rating is rated B2 by
Moody's Latin America with a positive outlook.
TELEFONICA DE ARGENTINA: Installs Communication Software for DHL
----------------------------------------------------------------
Telefonica de Argentina said that it has installed a
communication software for US logistics company DHL's Argentine
unit.
Business News Americas relates that Telefonica de Argentina
provided DHL with an Internet protocol network interconnecting
its branches, improving DHL's customer support platform.
According to BNamericas, the multi-protocol label switching
network connects DHL's 16 offices across Argentina, allowing all
branches to share strategic information like billing and
traffic.
Telefonica de Argentina provided the service through its
corporate services unit Telefonica Empresas, BNamericas notes.
Telefonica de Argentina will also deploy and conduct maintenance
works on the network for DHL, BNamericas states.
Headquartered in Buenos Aires, Argentina, Telefonica de
Argentina SA -- http://www.telefonica.com.ar/-- provides
telecommunication services, which include telephony business
both in Spain and Latin America, mobile communications
businesses, directories and guides businesses, Internet, data
and corporate services, audiovisual production and broadcasting,
broadband and Business-to-Business e-commerce activities.
* * *
As reported in the Troubled Company Reporter-Latin America on
Feb. 21, 2008, Fitch Ratings upgraded its local currency issuer
default rating on Telefonica de Argentina to 'BB' from 'BB-'.
The ratings agency also affirmed its 'B+' foreign currency
issuer default rating on the telecom firm.
Telefonica de Argentina's foreign currency rating is rated B2 by
Moody's Latin America with a positive outlook.
=============
B E R M U D A
=============
FOSTER WHEELER: Closes Biokinetics Acquisition
----------------------------------------------
Foster Wheeler Ltd. has completed the acquisition of 100% of the
stock of privately held Biokinetics Inc. from MPA Holdings LP.
The company has significantly strengthened its position in the
biotech and pharmaceutical markets.
This acquisition enables Foster Wheeler to re-establish its
position in the North American pharmaceutical market and
strengthens its position relative to key US pharmaceutical
companies seeking to invest in the US and globally. In
addition, this acquisition will provide enhanced capabilities to
existing Biokinetics clients.
Terms of the transaction were not disclosed.
"The pharmaceuticals, biotechnology and healthcare market is a
core market segment for Foster Wheeler and is one in which we
are committed to growing our market share," said Umberto della
Sala, president and chief operating officer of Foster Wheeler
Ltd. "This acquisition is part of Foster Wheeler's overall
strategy to complement organic growth in our Global Engineering
& Construction business with highly targeted acquisitions. This
particular transaction enables us to expand our global presence
in this sector and further enhance our existing
biopharmaceutical skills base. We will be able to deliver
comprehensive and responsive capabilities to existing, as well
as new, clients, anywhere in the world. We have already
established an excellent working relationship with Biokinetics
and believe that the combination of our two companies' skills
and experience will add value to pharmaceutical companies
developing projects in the U.S. and internationally."
Biokinetics was established in 1996 and is now a recognized
industry leader in process systems design for the
biopharmaceutical industry, with expertise in bioprocess unit
operations including:
* fermentation, mammalian cell culture, bioreactors,
bacterial and yeast fermentation recovery, live and
attenuated virus processing for vaccines and plasma-derived
products;
* associated processing and support systems;
* pharmaceutical fill-finish and materials handling;
* process simulation and optimization;
* modular process design;
* high-purity water systems;
* validation services.
About Biokinetics
Headquartered in Philadelphia, PA, Biokinetics --
http://www.biokinc.com/-- has additional operations in
California and North Carolina in the USA and Carlow in Ireland.
It has approximately 130 employees.
MPA Holdings LP is a Delaware limited partnership owned by the
three principals of Biokinetics: William Brydges, James
Dougherty and Anthony Contino. Under the terms of the purchase
agreement they will continue as the senior leadership team of
the company.
About Foster Wheeler Ltd.
Foster Wheeler Ltd. (Nasdaq: FWLT) -- http://www.fwc.com/--
offers a broad range of engineering, procurement, construction,
manufacturing, project development and management, research and
plant operation services. Foster Wheeler serves the refining,
upstream oil and gas, LNG and gas-to-liquids, petrochemical,
chemicals, power, pharmaceuticals, biotechnology and healthcare
industries. The corporation is based in Hamilton, Bermuda, and
its operational headquarters are in Clinton, New Jersey.
* * *
As reported in the Troubled Company Reporter-Latin America on
Feb. 5, 2008, Standard & Poor's Ratings Services revised its
outlook on Foster Wheeler Ltd. to positive from stable. At the
same time, S&P affirmed its 'BB' corporate credit rating on the
company. The company reported total debt of approximately
US$150 million at Sept. 30, 2007.
GP INVESTMENTS: Raises US$187.8 Million in New Share Sale
---------------------------------------------------------
GP Investments Ltd. has raised 318.9 million reais (US$187.8
million) through the sale of new Brazilian depositary receipts,
Guillermo Parra-Bernal of Bloomberg News reports.
As published in Valor Economico newspaper, the company has sold
the BDRs for 59 reais each. The report adds that each BDR
represents one Class A share.
Banco de Investimentos Credit Suisse Brasil SA and Citigroup
Global Markets Brasil managed the sale, Bloomberg relates.
Based in Hamilton, Bermuda, GP Investments Ltd. -
http://www.gpinvestments.com/-- is a leading
private equity player in Brazil. The GP Investments' activities
consist of its core private equity business and its asset
management business, and its mission is to generate higher than
average long-term return to its investors and shareholders.
Since its inception in 1993, GP Investments raised more than
US$1.5 billion from Brazilian and international investors, and
acquired more than thirty-five companies in ten different
sectors. On May 2006, GP Investments concluded its Initial
Public Offering -- IPO, becoming the first listed private equity
company in Brazil.
* * *
In October 2007, Fitch Ratings assigned a 'B/RR4' rating to GP
Investments Ltd's extension of its 2007 senior perpetual notes
program for US$40 million. Fitch said the Rating Outlook is
Positive.
INTELSAT LTD: Partners With SISLink to Launch HD-Ready Service
--------------------------------------------------------------
Intelsat Ltd. has formed a strategic alliance with SISLink, the
leading provider of satellite uplink services in Europe, to
launch an HD-ready automated video delivery service for
satellite newsgathering (SNG) users in the United States.
The strategic alliance will offer Intelsat(R) uPod(TM), a fully
integrated broadcasting solution that will allow U.S. SNG
operators to execute real-time broadcasting services more
efficiently. The new service will blend Intelsat's space and
ground infrastructure with SISLink's uPod(TM) system to support
web-based scheduling and transmission of live standard and high
definition video, as well as voice and Internet communications,
between wherever news or sports events are unfolding throughout
the continental United States.
SISLink's award-winning automated SNG uplink system, uPod, has
proven to be the uplink of choice for European broadcasters due
to its simplicity, HD compatibility and its reliability.
Removing the need for a skilled uplink engineer, uPod allows
broadcasters to have a true one-person SNG operation, with
increased flexibility yet returning significant cost savings.
As part of this agreement, SISLink developed a new, smaller
version of the uPod, the uPod Micro, which is small enough to be
mounted onto any vehicle.
The new service is scheduled to be launched in April 2008,
initially targeting customers who lease full-time space segment
capacity for SNG applications. A version of the service
targeting occasional-use customers is planned for launch later
in 2008.
"In Intelsat, SISLink has found a partner with a strong business
base in the U.S. and a shared focus on exceeding its customers'
requirements. Our revolutionary, client-empowering approach to
the uplink process combined with Intelsat's reach and
flexibility, has made SISLink's most ambitious plan a reality,"
said David Meynell, SISLink Managing Director. "Together, we
are changing the way the world gathers and delivers news
content."
"Our highly coveted North American Galaxy fleet is unrivaled in
the industry, providing the sought-after access news
organizations require to meet their broadcasting needs," said
Stephen Spengler, Intelsat's Executive Vice President, Sales and
Marketing. "By combining our industry-leading strengths,
SISLink and Intelsat can now offer the most unique solution for
content delivery currently available in the SNG market."
Intelsat(R) is registered by Intelsat, Ltd. and uPod(TM) is
trademarked by SISLink.
About SISLink
SISLink was formed in 1989, and is now recognized within the
industry as Europe's largest supplier of satellite uplinks,
providing uplink services to a wide range of leading news
organizations, including Sky News, ITV and ITN. The company's
revolutionary and innovative approach to researching and
developing new technologies combined with its ongoing commitment
to its client base has ensured the successful and continued
growth of this first class company.
About Intelsat
Headquartered in Pembroke, Bermuda, Intelsat, Ltd. --
http://www.intelsat.com/-- is the largest fixed
satellite service operator in the world and is owned by Apollo
Management, Apax Partners, Madison Dearborn, and Permira. The
company has a sales office in Brazil.
* * *
As reported in the Troubled Company Reporter-Latin America on
Feb. 19, 2008, Standard & Poor's Ratings Services lowered its
corporate credit rating on Bermuda-based Intelsat Ltd. to 'B'
from 'B+' and removed the ratings from CreditWatch. S&P said
the outlook is stable.
REFCO INC: SEC Sues Ex-CEO Bennett for Orchestrating Fraud
----------------------------------------------------------
The U.S. Securities and Exchange Commission filed on Feb. 19 a
civil injunctive action in the United States District Court for
the Southern District of New York against Phillip R. Bennett,
the former chairman and chief executive officer of Refco Inc.
and its corporate predecessor, Refco Group Ltd.
The Commission's complaint alleges that Mr. Bennett orchestrated
a scheme that periodically concealed hundreds of millions of
dollars owed to Refco by a private entity that he controlled.
The public revelation of Mr. Bennett's scheme in October 2005,
two months after the company's initial public offering of common
stock, caused hundreds of millions of dollars in losses to Refco
shareholders. The complaint also alleges that Mr. Bennett
directed practices that artificially inflated Refco's financial
results. As a result, the complaint alleges, Mr. Bennett
violated Section 17(a) of the Securities Act of 1933, Sections
10(b) and 13(b)(5) of the Securities Exchange Act of 1934, and
Exchange Act Rules 10b-5, 13b2-1, and 15d 14, and aided and
abetted Refco's violations of Sections 13(b)(2)(A), 13(b)(2)(B),
and 15(d) of the Exchange Act and Exchange Act Rules 15d-2 and
15d-13.
According to the complaint, from at least 1998 to October 2005,
Mr. Bennett's scheme periodically concealed debt owed to Refco
by Refco Group Holdings, Inc., a non-Refco entity that he
controlled. The debt was primarily the result of trading losses
and operating expenses that Refco transferred over time to RGHI.
Refco utilized a series of short-term loans that temporarily
transferred the debt to third parties immediately prior to the
ends of Refco fiscal periods. A few days after the fiscal
periods ended, the transactions were reversed, and the debt was
transferred back to RGHI. The Commission's complaint alleges
that Mr. Bennett directed the fiscal period-end transactions and
took certain actions to implement them, including executing many
of the documents used in those transactions.
The Commission's complaint also alleges that Mr. Bennett
instituted practices that artificially inflated Refco's reported
financial results in 2005. The practices involved Refco
recording fictitious interest income and income from sham
foreign exchange transactions. The inflation of financial
results was undertaken by Mr. Bennett to make Refco more
attractive to potential investors.
The Commission's complaint further alleges that, in 2005, Refco
filed with the Commission and provided to investors registration
statements and periodic reports that contained materially false
and misleading misstatements and omissions. The filings failed
to disclose the debt and the period end transactions, and some
of the filings reported income that had been fraudulently
inflated. Mr. Bennett signed the registrations statements and
periodic filings while knowing, or reckless in not knowing, that
the filings were materially false and misleading. Moreover, Mr.
Bennett explicitly certified the accuracy of the disclosures and
financial statements in the periodic filings.
The complaint seeks a permanent injunction enjoining Mr. Bennett
from violating Section 17(a) of the Securities Act, Sections
10(b) and 13(b)(5) of the Exchange Act, and Exchange Act Rules
10b-5, 13b2-1, and 15d 14, and from aiding and abetting
violations of Sections 13(b)(2)(A), 13(b)(2)(B), and 15(d) of
the Exchange Act and Exchange Act Rules 15d-2 and 15d-13. The
complaint also seeks payment by Mr. Bennett of unjust enrichment
that he received as a result of his actions, with prejudgment
interest thereon, and imposition of civil money penalties
against him pursuant to Section 20(d) of the Securities Act and
Section 21(d)(3) of the Exchange Act.
The U.S. Attorney's Office for the Southern District of New York
announced February 15, that Mr. Bennett has pleaded guilty to
all twenty counts of a superseding indictment previously
returned against him and charging him with conspiracy,
securities fraud, making false filings with the Commission, wire
fraud, making false statements to Refco's auditors, bank fraud,
and money laundering, for his actions in connection with the
Refco fraud.
The Commission acknowledged the assistance and cooperation of
the Office of the United States Attorney for the Southern
District of New York, the United States Postal Inspection
Service, and the Commodity Futures Trading Commission.
The Commission's investigation is continuing.
About Refco Inc.
Based in New York, Refco Inc. -- http://www.refco.com/-- is a
diversified financial services organization with operations in
14 countries and an extensive global institutional and retail
client base. Refco's worldwide subsidiaries are members of
principal U.S. and international exchanges, and are among the
most active members of futures exchanges in Chicago, New York,
London and Singapore. In addition to its futures brokerage
activities, Refco is a major broker of cash market products,
including foreign exchange, foreign exchange options, government
securities, domestic and international equities, emerging market
debt, and OTC financial and commodity products. Refco is one of
the largest global clearing firms for derivatives. The company
has operations in Bermuda.
The Company and 23 of its affiliates filed for chapter 11
protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006).
J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP, represent the Debtors in their restructuring efforts. Luc
A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP,
represents the Official Committee of Unsecured Creditors. Refco
reported US$16.5 billion in assets and US$16.8 billion in debts
to the Bankruptcy Court on the first day of its chapter 11
cases.
The Court confirmed the Modified Joint Chapter 11 Plan of
Refco Inc. and certain of its direct and indirect subsidiaries,
including Refco Capital Markets Ltd. and Refco F/X Associates
LLC, on Dec. 15, 2006. That Plan became effective on
Dec. 26, 2006.
Refco Commodity's exclusive period to file a chapter 11 plan
expired on Feb. 13, 2007.
REFCO INC: Ex-Finance Chief Robert Trosten Admits Fraud Charges
---------------------------------------------------------------
Robert Trosten, Refco Inc.'s former chief financial officer,
pleaded guilty to charges that includes conspiracy to commit
securities fraud, wire fraud, bank fraud, money laundering and
making false filings to the U.S. Securities and Exchange
Commission, Edith Honan and Paritosh Bansal write for Reuters.
"I take full responsibility for my conduct and my actions," Mr.
Trosten was quoted by Reuters as saying before Judge Naomi
Buchwald of the U.S. District Court for the Southern District of
New York." I apologize to my family and those I have harmed by
my conduct, which I sincerely and deeply regret."
"He deeply regrets his involvement in these fraudulent
activities, and is attempting to rectify the misjudgment that he
made ... by cooperating with the government," Mr. Trosten's
lawyers was quoted by Reuters as saying.
Mr. Trosten has agreed to serve as a witness in trials of other
defendants in the case as part of his guilty plea, Reuters
reports. He previously pleaded not guilty.
Mr. Trosten's guilty plea followed a similar move by former
Refco CEO Phillip Bennet. Messrs. Bennett and Trosten were set
to face trial on March 17, 2008, along with Tone Grant, Refco's
former president.
Mr. Trosten will appear in court in February 2009.
Bennett's Guilty Plea
As reported in the Troubled Company Reporter-Europe on Feb. 20,
2008, Bennett pleaded guilty to 20 charges that includes
conspiracy to commit securities fraud, wire fraud, bank fraud,
money laundering and making false filings to the U.S. Securities
and Exchange Commission.
Mr. Bennett faces a maximum 315 years in prison under federal
sentencing guidelines as well as forfeiture of US$2.4 billion in
assets. Mr. Bennett's sentencing is set for May 20, 2008.
About Refco Inc.
Based in New York, Refco Inc. -- http://www.refco.com/-- is a
diversified financial services organization with operations in
14 countries and an extensive global institutional and retail
client base. Refco's worldwide subsidiaries are members of
principal U.S. and international exchanges, and are among the
most active members of futures exchanges in Chicago, New York,
London and Singapore. In addition to its futures brokerage
activities, Refco is a major broker of cash market products,
including foreign exchange, foreign exchange options, government
securities, domestic and international equities, emerging market
debt, and OTC financial and commodity products. Refco is one of
the largest global clearing firms for derivatives. The company
has operations in Bermuda.
The Company and 23 of its affiliates filed for chapter 11
protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006).
J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP, represent the Debtors in their restructuring efforts. Luc
A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP,
represents the Official Committee of Unsecured Creditors. Refco
reported US$16.5 billion in assets and US$16.8 billion in debts
to the Bankruptcy Court on the first day of its chapter 11
cases.
The Court confirmed the Modified Joint Chapter 11 Plan of
Refco Inc. and certain of its direct and indirect subsidiaries,
including Refco Capital Markets Ltd. and Refco F/X Associates
LLC, on Dec. 15, 2006. That Plan became effective on
Dec. 26, 2006.
Refco Commodity's exclusive period to file a chapter 11 plan
expired on Feb. 13, 2007.
===========
B R A Z I L
===========
AMERICAN AXLE: Declares First Qtr. Dividend Payable on March 28
---------------------------------------------------------------
American Axle & Manufacturing Holdings, Inc. declared a cash
dividend of US$0.15 per share payable on March 28, 2008 to
stockholders of record on all of the company's issued and
outstanding common stock as of March 7, 2008.
Headquartered in Detroit, Michigan, American Axle &
Manufacturing Holdings Inc. (NYSE:AXL) -- http://www.aam.com/--
and its wholly owned subsidiary, American Axle & Manufacturing,
Inc., manufactures, engineers, designs and validates driveline
and drivetrain systems and related components and modules,
chassis systems and metal-formed products for light trucks,
sport utility vehicles and passenger cars. In addition to
locations in the United States (in Michigan, New York and Ohio),
the company also has offices or facilities in Brazil, China,
Germany, India, Japan, Luxembourg, Mexico, Poland, South Korea
and the United Kingdom.
* * *
As reported in the Troubled Company Reporter-Latin America on
Nov. 28, 2007, Moody's Investors Service affirmed American Axle
& Manufacturing Holdings, Inc.'s Corporate Family rating of Ba3
as well its senior unsecured rating of Ba3 to American Axle &
Manufacturing Inc.'s notes and term loan. At the same time, the
rating agency revised the rating outlook to stable from negative
and renewed the Speculative Grade Liquidity rating of SGL-1.
BANCO DO BRASIL: Mulls Increasing Retail Operations in LatAm
------------------------------------------------------------
Banco do Brasil's International Business Director Sandro Kohler
Marcondes told Business News Americas that the bank is
considering increasing its retail operations in Latin America
and Europe.
Mr. Marcondes commented to BNamericas, "In effect, we're already
in Portugal." BNamericas notes that Banco do Brasil has 30,000
customers in Portugal and 150,000 clients in Japan. Portugal
and Japan have sizable Brazilian immigrant communities.
According to BNamericas, Banco do Brasil expects to open a
commercial bank and a money transfer company in the U.S. in the
second half of 2008.
Banco do Brasil wants to have up to 400,000 customers in the
U.S. in five years, concentrating on the east coast, where most
of the approximately 1.5 million Brazilian expats live,
BNamericas says, citing Mr. Marcondes.
Mr. Marcondes commented to BNamericas, "It'll be a relatively
small operation. The US$44 million in starting capital will be
enough to support our business plan over the next five years."
Mr. Marcondes told BNamericas that Banco do Brasil could also
consider acquisitions in the U.S. The bank will rely on organic
growth for the first five years, offering primarily to
Brazilians immigrants:
-- money transfers,
-- credit cards, and
-- checking and savings accounts.
Banco do Brasil will expand its product line in the U.S. to
include personal loans. The bank could eventually offer private
pension plans and other savings instruments if there is enough
demand, BNamericas notes, citing Mr. Marcondes.
"We studied the market and found the Brazilian community in the
U.S. had potential. Some banks in the U.S. have a strategy for
Latinos but not necessarily for Brazilians with service in
Portuguese," Mr. Marcondes commented to BNamericas.
Banco do Brasil is Brazil's federal bank and is the largest in
Latin America with some 20 million clients and more than 7,000
points of sale (3,200 branches) in Brazil, and 34 offices and
partnerships in 26 other countries. In addition to its
traditional retail banking services, Banco do Brasil underwrites
and sells bonds, conducts asset trading, offers investors
portfolio management services, conducts financial securities
advising, and provides market analysis and research.
* * *
On Nov. 6, 2007, Moody's Investors Service assigned a Ba2
foreign currency deposit rating to Banco do Brasil. On Aug. 23,
2007, Moody's assigned a Ba2 long-term bank deposit rating on
the bank with a stable outlook.
In May 2007, Standard & Poor's Ratings Services raised its long-
term foreign currency counterparty credit rating on Brazilian
government-related entity Banco do Brasil to 'BB+' from 'BB',
after Brazil's foreign currency sovereign credit rating was
upgraded to BB+.
BANCO NACIONAL: Approves BRL32-Million Financing to Fundacao
------------------------------------------------------------
Banco Nacional de Desenvolvimento Economico e Social has
approved financial support for BRL32 million to Fundacao
Butantan for the completion of the development of vaccines
against rotavirus, dengue and canine leishmaniasis, besides the
respective clinical tests. The total project amount is of
BRL37 million and BNDES' participation is of 86% of the total
investment. Those vaccines will be part of the Department of
Health's Programa Nacional de Imunizacao [National Immunization
Program] - PNI. In the specific case of rotavirus vaccine, the
development will enable the country to replace importations.
The project will be financed with non-reimbursable resources
from BNDES' Technological Fund [Funtec]. Funtec is destined to
support projects of strategic interest to the country, which
hold as objective to stimulate the technological development and
innovation, in accordance with the Federal Government's public
policies and programs.
The investments supported by BNDES will be carried forward in
the laboratories of Instituto Butantan, located in the city of
Sao Paulo [State of Sao Paulo]. The vaccines still under
development are important for public health, besides two of them
(leishmaniasis and dengue) falling under the neglected diseases
category.
The project will contribute towards the control and eradication
of infectious-contagious diseases which can be prevented through
vaccination. Furthermore, it will enable the reduction of PNI
costs and diminishment of vaccine imports by the country.
Infection by rotavirus annually affects, in Latin America,
approximately 10 million people, with 75 thousand
hospitalization and 15 thousand deaths. The rotavirus is one of
the leading causes of child mortality due to dehydration,
which causes diarrhea in children younger than one year old.
Dengue, virosis transmitted by the Aedes aegypti mosquito, is
present in more than 100 tropical countries, with incidence of
50 million cases and 20 thousand deaths per year.
The skin leishmaniasis, skin mucus and visceral affects
approximately 2 million people in the world. It is mostly
transmitted by insects that bite infected dogs. The
leishmaniasis is deemed by the World Health Organization [WHO]
one of the six major endemics of the planet. The Instituto
Butantan project intends to develop a combined vaccine
leishmaniasis and canine-rabies.
Instituto and Fundacao Butantan - Instituto Butantan, founded in
1901, is a biomedical research center, entailed to the Health
Office of the State of Sao Paulo, responsible for the production
of more than 80% of the total serum and vaccines consumed in
Brazil. Its mission is to develop studies and basic research in
the biology area and biomedicine area directly or indirectly
related to public health.
Currently, it produces serum, vaccines and bio-medications.
Amongst the vaccines produced, one may highlight those against
tetanus, double shot (diphtheria and tetanus), and triple shot
(diphtheria, tetanus and whooping cough), recombining hepatitis
B, BCG [tuberculosis] and anti-rabies.
The products manufactured by Instituto Butantan are sold by
Fundacao Butantan, mainly to the Department of Health. Between
2001/2005, Butantan's participation in the production of
vaccines for the Department of Health reached, on average,
530 million doses, amongst vaccines fully produced and filled
(imported kit).
Fundacao Butantan, established in 1989 as a private, non-profit
foundation, aims at collaborating with Instituto Butantan,
through investments on scientific, technological and cultural
development, on production and sales of immunobiological
medications and other products, besides the provision of
services to the community.
With the new products to be developed, it is projected the
generation of 100 new direct job posts. Currently, Butantan's
Biotechnology Center counts on 25 doctors, who together with
individuals on scholarships, master's degree and doctorate
degree candidates and other interns sum up 50 researchers.
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.
* * *
Banco Nacional currently carries a Ba2 foreign long-term bank
deposit rating from Moody's Investors Service, and a BB+ long-
term foreign issuer credit rating from Standards and Poor's
Ratings Services. The ratings were assigned in August and May
2007.
BRASIL TELECOM: Inks O&M Services Deal With Alcatel-Lucent
----------------------------------------------------------
Alcatel-Lucent has siged a major contract with Brasil Telecom to
provide Operations and Maintenance (O&M) services for the
carrier internal plant (including wireless, wireline and data
networks), as well as their outside plant. This project
reinforces the strategic partnership between Brasil Telecom and
Alcatel-Lucent, and solidifies the company's leadership in
providing operations and maintenance services for fixed, mobile
and data networks in Brazil.
This contract represents a milestone in Latin America as no
other company in the region is responsible for the whole
infrastructure of an operator. Brasil Telecom is pioneering
this field by selecting an experienced and capable supplier as
its partner to simplify and expand its business.
Based on the agreement Alcatel-Lucent will take care of 100
percent of Brasil Telecom infrastructure, including detailed O&M
for the operator's wireless network (voice, data and core);
switches and transmission for fixed land line; data
communications and ADSL (core and access); satellite platform;
infrastructure (building, AC/DC energy, air conditioning, towers
and poles); network management systems; and technical support
for all levels.
"This is the biggest contract signed by Brasil Telecom in the
last few years and we look forward to an exceptionally close
working relationship with Alcatel-Lucent as we strive to bring
out customers the most reliable and highest quality
communications services available," said Brasil Telecom
Operations Vice-President, Francisco Santiago. "Alcatel-Lucent
will take care of the whole operation and maintenance of our
fixed-line and wireless telephony infrastructure and we trust
their capacity for that. For us it's a new way of working,
creating a package of services that spans maintenance,
engineering, installation and operations to attain OPEX and
CAPEX reduction."
This new contract demonstrates the breadth and depth of Alcatel-
Lucent services portfolio, as it encompasses network consulting
and planning, network operations, optimization and maintenance.
Alcatel-Lucent is the main equipment and solution supplier for
Brasil Telecom and has also provided O&M services for the
operator since 2002.
Alcatel-Lucent plans to create a centralized technical
management center, implement process and organizational
improvements between outside plant and internal infrastructure,
and improve productivity at central management center level
through application of workforce management, improving existing
Operation System Support tools to better apply fault correlation
and automatic dispatching.
"This network services contract with Brasil Telecom builds upon
our long-term relationship with them, which is built on trust,
confidence and a spirit of partnership. Their decision to have
a single partner responsible for the operation and maintenance
of their network is quite visionary and is a pioneering strategy
by the operator, both in Brazil and the region," said President
of Alcatel-Lucent's activities in the Caribbean and Latin
America region, Victor Agnellini. "We are committed on
delivering the best services and an excellent experience for
Brasil Telecom and its customers by ensuring the reliability and
quality of the carrier's entire infrastructure. And we look
forward to welcoming the talented employees from Brasil Telecom
who will be joining Alcatel-Lucent to ensure we can leverage
their expertise to maintain the high quality of the service
Brasil Telecom provides."
Brasil Telecom is a leading telecommunications integrated
services provider and frontrunner player involved in bundle
fixed/mobile and broadband services in Brazil. With more than 8
million fixed line users and close to 4 million mobile
subscribers, as well as more than 1.7 million ADSL broadband
users, the operator's services cover a large portion of Brazil,
including the Federal District and the states of Acre, Rondonia,
Tocantins, Mato Grosso, Mato Grosso do Sul, Goias, Parana, Santa
Catarina, and Rio Grande Do Sul. It also offers nationwide and
international long-distance services.
About Alcatel-Lucent
Headquartered in Paris, France, Alcatel-Lucent S.A. --
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.
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, Indonesia, Australia, Brunei and
Cambodia.
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; intra-regional
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.
* * *
To date, Brasil Telecom carries Moody's Investors Service's Ba1
senior unsecured and credit default swap ratings.
BROWN SHOE: Richard Schumacher to Retire Effective March 31
-----------------------------------------------------------
Richard C. Schumacher, senior vice president and chief
accounting officer of Brown Shoe Company Inc., will be retiring
from the company effective March 31, 2008, the company disclosed
in a regulatory filing with the U.S. Securities and Exchange
Commission dated Feb. 19, 2008.
Headquartered in St. Louis, Missouri, Brown Shoe Company Inc.
(NYSE:BWS) -- http://www.brownshoe.com/-- is a US$2.4 billion
footwear company with global operations including Brazil, Italy,
China, Hong Kong, and Taiwan. Brown Shoe's Retail division
operates Famous Footwear, the 1,000-store chain that sells brand
name shoes for the family, approximately 300 specialty retail
stores in the U.S. and Canada under the Naturalizer, FX LaSalle,
and Franco Sarto names, and Shoes.com, the company's e-commerce
subsidiary. Brown Shoe, through its wholesale divisions, owns
and markets footwear brands including Naturalizer, LifeStride,
Via Spiga, Nickels Soft, Connie and Buster Brown; it also
markets licensed brands including Franco Sarto, Dr. Scholl's,
Etienne Aigner, and Carlos by Carlos Santana and Barbie, Disney
and Nickelodeon character footwear for children.
* * *
Moody's Investor Services placed Brown Shoe Company Inc.'s
probability of default rating at 'Ba3' in September 2006. The
rating still holds to date with a positive outlook.
CAIXA ECONOMICA: To Increase Lending by 30% This Year
-----------------------------------------------------
Caixa Economica Federal's Vice President Marcos Roberto
Vasconcelos told reporters in Brazil that the company would
boost lending at least 30% in 2008.
According to Business News Americas, Caixa Economica has an
initial budget of BRL86.0 billion this year. Mr. Vasconselos
told BNamericas that lending growth has picked up since October
2007. Loans for sanitation and infrastructure have increased
around 40%, while housing loans rose almost 70%. Caixa
Economica could surpass its goals for this year.
BNamericas notes that Caixa Economica increased lending 22.3% to
BRL55.9 billion in 2007, compared to 2006. Its retail lending
rose 17.4% to BRL27.7 billion. Loans to businesses grew 11.6%
to BRL25.9 billion. Housing loans rose 49.2% to BRL21.0
billion. Loans for infrastructure and sanitation increased 265%
to BRL15.7 billion.
Caixa Economica's net interest income decreased 18.7% to BRL9.03
billion in 2007 on lower interest rates, BNamericas says.
Mr. Vasconcelos commented to Brazilian financial daily Gazeta
Mercantil, "We're working with lower spreads but maintaining our
profitability."
BNamericas relates that Caixa Economica's net profits rose 5.20%
to BRL2.51 billion in 2007, from 2006. The company surrendered
BRL1.1 billion of the net profit to the federal government. Its
return on equity dropped to 23.7% in 2007, from 26.0% in 2006.
Its efficiency ratio declined to 74.8% from 64.2%.
Caixa Economica's total assets increased 19.1% to BRL250 billion
in 2007, compared to 2006, BNamericas reports.
Apart from its commercial banking activities, Caixa Economica
Federal is responsible for executing policies in the areas of
housing and basic sanitation, the administration of social funds
and programs and federal lotteries.
* * *
In November 2007, Moody's Investors Service assigned a Ba2
foreign currency deposit rating to Caixa Economica Federal.
DELPHI CORP: Must Pay Professionals US$49 Mln in Fees & Expenses
----------------------------------------------------------------
The Hon. Robert Drain of the U.S. Bankruptcy Court for the
Southern District of New York directed Delphi Corp. and its
debtor-affiliates to pay the professionals retained in the
Debtors' bankruptcy cases approximately US$45,000,000 in fees
and US$3,000,000 in expenses.
Blake, Cassels & Graydon LLP seeks payment of CDN$16,920 for its
professional fees for the period June 1, 2007, through Sept. 30,
2007, and reimbursement of CDN$1,312 for expenses incurred
during the same period. Blake Cassels serves as the Debtors'
Canadian counsel.
Headquartered in Troy, Michigan, Delphi Corporation (PINKSHEETS:
DPHIQ) -- http://www.delphi.com/-- is the single supplier of
vehicle electronics, transportation components, integrated
systems and modules, and other electronic technology. The
company's technology and products are present in more than
75 million vehicles on the road worldwide. Delphi has regional
headquarters in Japan, Brazil and France.
The company filed for chapter 11 protection on Oct. 8, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr.,
Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden,
Arps, Slate, Meagher & Flom LLP, represent the Debtors in their
restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A.
Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP,
represents the Official Committee of Unsecured Creditors. As of
March 31, 2007, the Debtors' balance sheet showed
US$11,446,000,000 in total assets and US$23,851,000,000 in total
debts.
The Court approved Delphi's First Amended Joint Disclosure
Statement and related solicitation procedures for the
solicitation of votes on the First Amended Plan on Dec. 20,
2007. The Court confirmed the Debtors' First Amended Plan on
Jan. 25, 2008.
(Delphi Bankruptcy News; Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
* * *
As reported in the Troubled Company Reporter-Latin America on
Jan. 16, 2008, Moody's Investors Service assigned ratings to
Delphi Corporation for the company's financing for emergence
from Chapter 11 bankruptcy protection: Corporate Family Rating
of (P)B2; US$3.7 billion of first lien term loans, (P)Ba3; and
US$0.825 billion of 2nd lien term debt, (P)B3. In addition, a
Speculative Grade Liquidity rating of SGL-2 representing good
liquidity was assigned. The outlook is stable.
As reported in the Troubled Company Reporter on Jan. 11, 2008,
Standard & Poor's Ratings Services expects to assign its 'B'
corporate credit rating to Troy, Michigan-based automotive
supplier Delphi Corp. upon the company's emergence from Chapter
11 bankruptcy protection, which may occur by the end of the
first quarter of 2008. S&P expects the outlook to be negative.
In addition, Standard & Poor's expects to assign these
issue-level ratings: a 'B+' issue rating (one notch above the
corporate credit rating), and '2' recovery rating to the
company's proposed US$3.7 billion senior secured first-lien term
loan; and a 'B-' issue rating (one notch below the corporate
creditrating), and '5' recovery rating to the company's proposed
US$825 million senior secured second-lien term loan.
GENERAL MOTORS: Inks Settlement Pact With UAW and Union Retirees
----------------------------------------------------------------
General Motors Corporation, the International Union, United
Automobile, Aerospace and Agricultural Workers of America and
the class representatives in a class action case filed with the
U.S. District Court for the Eastern District of Michigan against
GM on Sept. 26, 2007 by the UAW and putative class
representatives of GM-UAW, entered into a settlement agreement
on Feb. 21, 2008.
The Settlement Agreement effects the transactions contemplated
by the Memorandum of Understanding -- Post-Retirement Medical
Care that was entered into between GM and the UAW on Sept. 26,
2007, in conjunction with the negotiation by GM and the UAW of a
new national collective bargaining agreement governing the
wages, hours and terms and conditions of employment for UAW-
represented employees.
"This proposed settlement will put into effect what we
negotiated in 2007," UAW President Ron Gettelfinger said.
"Through hard work and hard bargaining, we have negotiated an
innovative way to secure health care benefits for UAW GM
retirees."
The VEBA trust, Mr. Gettelfinger said, "will be managed by
independent trustees with expertise in health care, investments,
finance and other key areas. We are confident it will have
sufficient assets and sufficient cash flow to pay benefits to
our retirees for the next 80 years.
"The VEBA trust will protect our retirees. That's why we
negotiated it last year, and that's why we're supporting this
proposed settlement."
The Settlement Agreement provides that on the later of Jan. 1,
2010 or final court approval of the Settlement Agreement, GM
will transfer its obligations to provide covered UAW employees
with post-retirement medical benefits to a new retiree health
care plan to be established and funded by a newly established
Voluntary Employee Beneficiary Association trust. GM will fund
the New VEBA through a number of sources including: funds that
are currently in existing voluntary employee beneficiary
association trusts, GM-issued convertible and short term notes,
as well as cash on hand or additional sources of liquidity.
The parties to the Settlement Agreement have acknowledged that
GM's obligations to pay into the New VEBA are fixed and capped
as provided in the Settlement Agreement and that GM is not
responsible for, and does not provide a guarantee of:
(1) the payment of future benefits to plan participants,
(2) the asset returns of the funds in the New VEBA, or
(3) whether there will be sufficient assets in the New VEBA
to fully pay the obligations of the New VEBA or New Plan.
In the event the assets of the New VEBA are not sufficient to
fully fund the obligations of the New Plan, the New VEBA and New
Plan will be required to reduce benefits to plan participants.
The Settlement Agreement is subject, in its entirety, to:
obtaining a class certification order from the United States
District Court for the Eastern District of Michigan such that
the class in the certification order is defined in the same
manner as Class is defined in the Settlement Agreement;
obtaining Court approval in a form acceptable to GM, the UAW and
the Class; completing discussions between GM and the Securities
Exchange Commission regarding accounting treatment on a basis
satisfactory to GM.
The Settlement Agreement may be terminated by any party upon 30
days notice if, among other things, satisfactory class
certification or Court approval has been received and such
certification or Court approval is subsequently overturned on
appeal. GM may immediately terminate the Settlement Agreement
if, after discussions with the SEC, GM does not believe that the
accounting treatment for the New VEBA and the New Plan is
satisfactory to GM.
The U.S. District Court has scheduled a hearing June 3, 208, in
Detroit to consider approval of the proposed settlement.
A full-text copy of the Settlement Agreement is available for
free at: http://ResearchArchives.com/t/s?2875
Convertible Note
On Feb. 22, 2008, GM issued US$4,372,500,000 principal amount of
its 6.75% Series U Convertible Senior Debentures Due Dec. 31,
2012 to LBK, LLC, a Delaware limited liability company of which
GM is the sole member, pursuant to the Settlement Agreement.
LBK will hold the Convertible Note until it is transferred to
the New VEBA in accordance with the terms of the Settlement
Agreement. Interest on the Convertible Note is payable
semiannually. In accordance with the Settlement Agreement LBK
will transfer any interest it receives on the Convertible Note
to a temporary asset account maintained by GM. The funds in the
temporary asset account will be transferred to the New VEBA in
accordance with the terms of the Settlement Agreement.
The Convertible Note was issued pursuant to an indenture, dated
as of Jan. 8, 2008, between GM and The Bank of New York, as
trustee, as supplemented by the First Supplemental Indenture
dated as of Feb. 22, 2008. The Convertible Note matures on Dec.
31, 2012 and will constitute a part of GM's senior debt and will
rank equally with all of GM's other unsecured and unsubordinated
debt. GM may redeem the Convertible Note, in whole or in part,
at any time on or after Jan. 1, 2011 in cash at a price equal to
100% of the principal amount being redeemed plus (1) accrued and
unpaid interest and (2) under certain circumstances if the
Convertible Note is held by the New VEBA, an additional
redemption adjustment amount.
The Convertible Note will be initially convertible, subject to
certain conditions, by a holder, other than LBK, into shares of
GM common stock at a conversion rate of .625 shares of common
stock per US$25 principal amount of the Convertible Note,
representing an initial effective conversion price of US$40 per
share. The conversion rate is subject to adjustment upon
certain circumstances. Upon conversion, GM has the right to pay
cash in lieu of any shares of common stock that otherwise would
have been issuable.
In conjunction with the issuance of the Convertible Note, GM and
LBK have entered into certain cash-settled derivative
instruments maturing on June 30, 2011 that will have the
economic effect of reducing the conversion price of the
Convertible Note from US$40 to US$36. These derivative
instruments will also entitle GM to partially recover the
additional economic value provided if GM's common stock price
appreciates to between US$63.48 and US$70.53 per share and to
fully recover the additional economic value provided if GM's
common stock price reaches US$70.53 per share or above.
Pursuant to the Settlement Agreement, LBK will transfer its
interests in the derivatives to the New VEBA when the
Convertible Note is transferred from LBK to the New VEBA.
Short Term Note
On Feb. 21, 2008, GM issued a short term note in the principal
amount of US$4,015,187,871 to LBK pursuant to the Settlement
Agreement. The Short Term Note pays interest at a rate of 9%
and matures on the date that the face amount of the Short Term
Note is paid with interest to the New VEBA in accordance with
the terms of the Settlement Agreement.
LBK will hold the Short Term Note until it matures. Upon
maturity, and in accordance with the Settlement Agreement, GM
will cause LBK to pay to the New VEBA in cash the face value of
the Short Term Note, plus cash in an amount equal to the
interest accrued on such amount from and including the date of
the Short Term Note, but excluding the date of payment to the
New VEBA.
As a wholly owned consolidated subsidiary of GM, LBK will hold
the convertible note, the short term note, and the derivatives
until they are transferred or paid to the New VEBA. As such,
these three securities will be effectively eliminated in GM's
consolidated financial statements until they are transferred to
the New VEBA.
About General Motors
Headquartered in Detroit, Michigan, General Motors Corp. (NYSE:
GM) -- http://www.gm.com/-- was founded in 1908. GM employs
about 266,000 people around the world and manufactures cars and
trucks in 35 countries, including the United Kingdom, Germany,
France, Russia, Brazil and India. In 2007, nearly 9.37 million
GM cars and trucks were sold globally under the following
brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden,
HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's
OnStar subsidiary is the industry leader in vehicle safety,
security and information services.
* * *
As reported in the Troubled Company Reporter-Latin America on
Nov. 9, 2007, Moody's Investors Service affirmed its rating for
General Motors Corporation (B3 Corporate Family Rating, Ba3
senior secured, Caa1 senior unsecured and SGL-1 Speculative
Grade Liquidity rating) but changed the outlook to Stable from
Positive. In an environment of weakening prospects for US auto
sales GM has announced that it will take a non-cash charge of
$39 billion for the third quarter of 2007 related to
establishing a valuation allowance against its deferred tax
assets (DTAs) in the US, Canada and Germany.
As reported in the Troubled Company Reporter-Latin America on
Oct. 23, 2007, Standard & Poor's Ratings Services affirmed its
'B' corporate credit rating and other ratings on General Motors
Corp. and removed them from CreditWatch with positive
implications, where they were placed Sept. 26, 2007, following
agreement on the new labor contract. The outlook is stable.
GERDAU SA: Cleary Holdings Acquisition Good for Firm, Says Ativa
----------------------------------------------------------------
Gerdau SA's planned acquisition of a 50.9% stake in Cleary
Holdings Corp. is a positive move, Business News Americas
reports, citing brokerage Ativa.
As reported in the Troubled Company Reporter-Latin America on
Feb. 26, 2008, Gerdau signed a purchase agreement to acquire the
stake in Cleary Holdings for US$59 million.
BNamericas relates that Cleary Holdings has coke production
units and coking coal reserves in Colombia. It has installed
capacity of one million tons per year of coke and estimated
coking coal reserves of 20 million tons.
"From a strategic point of view, the acquisition demonstrates a
higher effort by Gerdau toward assuring the demand for its basic
inputs, even though about 20% of its steel production comes from
blast furnaces that use coke. The coal market is going through
a marked unbalance between supply and demand and we expect a
price increase of 75-100%," Ativa commented to BNamericas.
Headquartered in Porto Alegre, Brazil, Gerdau SA
-- http://www.gerdau.com.br/-- produces and distributes crude
steel and related long rolled products, drawn products, and long
specialty products. In addition to Brazil, Gerdau operates in
Argentina, Canada, Chile, Colombia, Uruguay, India and the
United States.
* * *
As reported in the Troubled Company Reporter-Latin America on
Nov. 26, 2007, Moody's Investors Service affirmed Gerdau S.A.'s
Ba1 corporate family rating and stable outlook.
PERDIGAO SA: Net Income Rises 174% to BRL321.3 Million in 2007
--------------------------------------------------------------
Perdigao S.A. has ended 2007 reporting gross sales of BRL7.8
billion, 27.6% more than recorded in the preceding year. Net
income posted an increase of 174% to BRL321.3 million. The
results were boosted by good performance in the domestic and
export markets, gains in scale and productivity, as well as an
increased participation of 53% of processed products as a
percentage of the company's total net sales.
These factors, combined with the full integration of Batavia's
dairy-processed products, and the margarine and beef businesses
acquired during the year, resulted in growth of 27.3% in net
sales to BRL6.6 billion in 2007. Exports accounted for 47.5% of
net sales and domestic market, 52.5%.
In spite of the appreciation of the Real in relation to the US
dollar and the increase in grain prices, growth in export
revenues was 30%, reflecting stronger international demand that
increased sales volumes of meats by 18.6% and other processed
products by 67.3%.
Domestic market revenue increased 25.9% compared with 2006,
driven by sales revenue from activities in the meat segment and
by an increase of 71.4% in volume of dairy-processed products
and 84% for other processed products.
Gross profits increased 39.4%, totaling BRL1.9 billion. EBITDA
(operating profit before financial expenses, taxes and
depreciation) in the period reached BRL802.7 million, a year-on-
year increase of 76.1%, and equivalent to a 12.1% margin, a gain
of 340 basis points against the preceding fiscal year.
In 2007, Perdigao's capital expenditures totaled BRL857.4
million, 34.6% higher than 2006. Of this total, 41% was
allocated to acquisitions (excluding the Eleva acquisition) and
the remainder to new projects and production lines, to the
conclusion of the Mineiros Agro-Industrial Complex in the state
of Goias and to improvements in productivity.
Numbers For 2007 (in BRL million)
2007 2006 % Change
Gross Sales 7,788.6 6,106.0 27.6
Domestic Market 4,589.2 3,644.5 25.9
Exports 3,199.4 2,461.4 30.0
Net Sales 6,633.4 5,209.8 27.3
Gross Profits 1,873.3 1,344.1 39.4
EBIT 503.9 191.4 163.3
Net Income 321.3 117.3 174.0
EBITDA 802.7 455.8 76.1
Capex 857.4 636.9 34.6
Earnings per share BRL 1.73 0.71 144.5
Headquartered in Sao Paulo, Brazil, Perdigao S.A. is one of the
largest food processors in Brazil, with a focus on poultry,
pork, beef, milk and processed products including dairy. With
revenues of BRL6 billion for the last twelve months eding in
June 30, 2007, Perdigao is one of the leaders in the domestic
market and exports 42% of its sales to over 100 countries and
850 customers around the world.
* * *
As of Nov. 1, 2007, Moody's Investors Service affirmed Perdigao
SA's Ba1 corporate family rating following the company's
announced signed agreement to acquire Eleva Alimentos S.A. for
approximately BRL1.67 billion in equity value plus BRL547
million in assumed debt. Moody's rating outlook remains stable.
PRIDE INTERNATIONAL: Closes Sale of Three Rigs for US$213 Mil.
--------------------------------------------------------------
Pride International Inc. has completed the previously announced
sale of its three self-erecting, tender-assist rigs, the Al
Baraka I, Alligator and Barracuda, for US$213 million in cash.
Proceeds from the sale are expected to be utilized for general
corporate and strategic purposes, including potential funding
for the construction of the company's three ultra-deepwater
drillships and other future growth opportunities.
About Pride International
Headquartered in Houston, Texas, Pride International Inc.
(NYSE: PDE) -- http://www.prideinternational.com/-- provides
onshore and offshore contract drilling and related services in
more than 25 countries, operating a diverse fleet of 277 rigs,
including two ultra-deepwater drillships, 12 semisubmersible
rigs, 28 jackups, 16 tender-assisted, barge and platform rigs,
and 214 land rigs. The company maintains worldwide operations
in France, Mexico, Kazakhstan, India, and Brazil, among others.
* * *
As reported in the Troubled Company Reporter-Latin America on
Nov. 22, 2007, Standard & Poor's Ratings Service raised its
corporate credit rating on offshore contract drilling firm Pride
International Inc. to 'BB+' from 'BB'. At the same time, S&P
raised the rating on the company's unsecured debt to 'BB+' from
'BB-'. S&P said the outlook is stable.
PRIDE INTERNATIONAL: Names David Hager to Board of Directors
------------------------------------------------------------
Pride International Inc. has appointed David A. Hager to the
company's board of directors, effective immediately.
Over the past 29 years, Mr. Hager has served in numerous senior
management positions in the oil and gas industry, most recently
as the chief operating officer for Kerr-McGee Corporation until
his retirement in August 2006 following the merger of Kerr-McGee
with Anadarko Petroleum Corporation.
Mr. Hager began his career in the oil and gas industry in 1979
as an exploration geophysicist with Mobil Corporation and in
1981, he joined Sun Oil Company (predecessor of Oryx Energy
Company). Mr. Hager joined Kerr-McGee as vice president of Gulf
of Mexico operations following the company's merger with
Oryx in 1999, became vice president of international operations
in April 2000 and was named vice president of worldwide
deepwater exploration and production in October 2000. Mr. Hager
became vice president of Gulf of Mexico and worldwide deepwater
exploration and production in 2001, was named vice president of
exploration and production in 2002 and became senior vice
president (oil and gas exploration and production) in March
2003. He was named chief operating officer of Kerr-McGee in
July 2005.
Mr. Hager currently serves as a director of Devon Energy
Corporation.
In addition, the company announced that David B. Robson will
retire from the Pride International board of directors effective
on the date of the company's 2008 Annual Meeting of
Stockholders. Mr. Robson's service dates back to May 1998, when
he joined the board of directors of Marine Drilling Companies,
Inc. He has served on the Pride International board since the
company's merger with Marine Drilling in September 2001.
Louis A. Raspino, President and Chief Executive Officer of Pride
International, Inc., stated, "On behalf of the board of
directors, stockholders and employees of Pride, I would like to
sincerely thank Dave for his dedicated service on the board. We
wish Dave all the best in his retirement."
About Pride International
Headquartered in Houston, Texas, Pride International Inc.
(NYSE: PDE) -- http://www.prideinternational.com/-- provides
onshore and offshore contract drilling and related services in
more than 25 countries, operating a diverse fleet of 277 rigs,
including two ultra-deepwater drillships, 12 semisubmersible
rigs, 28 jackups, 16 tender-assisted, barge and platform rigs,
and 214 land rigs. The company maintains worldwide operations
in France, Mexico, Kazakhstan, India, and Brazil, among others.
* * *
As reported in the Troubled Company Reporter-Latin America on
Nov. 22, 2007, Standard & Poor's Ratings Service raised its
corporate credit rating on offshore contract drilling firm Pride
International Inc. to 'BB+' from 'BB'. At the same time, S&P
raised the rating on the company's unsecured debt to 'BB+' from
'BB-'. S&P said the outlook is stable.
UNIAO DE BANCOS: To Expand Points of Sale Network by 400 Units
--------------------------------------------------------------
Uniao de Bancos Brasileiros S.A. will expand its network of
points of sale, directly or through its subsidiaries, by
approximately 400 units in 2008 and 2009, including branches,
corporate-site branches and points of sale within retail
partners and, also, revitalize its already existing distribution
network.
Unibanco estimated that the expansion, occurring during 2008 and
2009, will require the hiring of approximately 5,000 new
employees. Unibanco projected that the Expansion will involve
approximately 60% of the capital expenditure in 2008 and 2009,
with an impact in personnel and administrative expenses.
Unibanco expected a 7% to 12% increase in its total personnel
and administrative expenses in 2008 as compared to 2007.
The objective of the expansion is to increase the scale and
reach of distribution of retail financial products offered by
Unibanco, in line with the continuous goal of creating value for
its shareholders.
All of the measures necessary for the achievement of the
Expansion will be carefully evaluated by the relevant internal
departments, which will take into consideration Brazil's
economic and market conditions during the period of its
fulfillment, so as to reach conscientious and responsible
decisions, as always with the goal of preserving the rights and
interests of Unibanco's clients and shareholders.
About Unibanco
Headquartered in Sao Paulo, Brazil, Uniao de Bancos Brasileiros
SA -- http://www.unibanco.com/-- is a full-service financial
institution providing a range of financial products and services
to a diversified individual and corporate customer base
throughout Brazil. The company's businesses comprise segments:
Retail, Wholesale, Insurance and Pension Plans and Wealth
Management. Uniao de Bancos and its associated companies
FinInvest, LuizaCred, PontoCred and Tecban (Banco 24 Horas)
offer a network composed of 17,000 points of service. It also
counts on 7,580 automated teller machines and all 30 Hours'
products and services, including the telephone service and the
Internet banking. The company's international network consists
of branches in Nassau and the Cayman Islands; representatives
offices in New York; banking subsidiaries in Luxembourg, the
Cayman Islands and Paraguay; and a brokerage firm in New York --
Unibanco Securities Inc.
* * *
To date, Standard & Poor's Ratings Services rated Unibanco-Uniao
de Bancos Brasileiros SA's long-term foreign issuer credit
rating and local issuer credit rating at 'BB+'.
==========================
C A Y M A N I S L A N D S
==========================
AH INC: Proofs of Claim Filing Is Until March 6
-----------------------------------------------
AH, Inc.'s creditors have until March 6, 2008, to prove their
claims to Helvetic Management Services Limited, 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.
AH's shareholders agreed on Jan. 1, 2008, to place the company
into voluntary liquidation under The Companies Law (2004
Revision) of the Cayman Islands.
The liquidator can be reached at:
Helvetic Management Services Limited
Attn: Colin G. Shaw
Alamander Way, Grand Pavilion
P.O. Box 31083, Grand Cayman KY1-1205
Cayman Islands
Phone: 945-3301
Fax: 945-3302
ARIANE HEALTH: Proofs of Claim Filing Deadline Is March 6
---------------------------------------------------------
Ariane Health Limited, LDC's creditors have until March 6, 2008,
to prove their claims to John Cullinane and Derrie Boggess, 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.
Ariane Health's shareholders agreed on Jan. 31, 2008, to place
the company into voluntary liquidation under The Companies Law
(2004 Revision) of the Cayman Islands.
The liquidators can be reached at:
John Cullinane and Derrie Boggess
c/o Walkers SPV Limited
Walker House, 87 Mary Street
George Town, Grand Cayman KY1-9002
Cayman Islands
Telephone: (345) 914-6305
CHENGWEI AAC: Sets Final Shareholders' Meeting for March 6
----------------------------------------------------------
Chengwei AAC Holdings Ltd. will hold its final shareholders'
meeting on March 6, 2008, at 58 West Portal Avenue, San
Francisco, CA 94127.
These matters will be taken up during the meeting:
1) accounting of the winding-up process; and
2) giving explanation thereof.
Chengwei AAC's shareholders decided on Jan. 15, 2008, to place
the company into voluntary liquidation under The Companies Law
(2004 Revision) of the Cayman Islands.
The liquidator can be reached at:
Aline Moulia
Corporate Filing Services Ltd.
P.O. Box 613, Grand Cayman KY1-1107
Cayman Islands
Telephone: 415-609-4845
Fax: 415-358-4045
PARIS HOTEL: Proofs of Claim Filing Deadline Is March 6
-------------------------------------------------------
Paris Hotel Investment Company's creditors have until March 6,
2008, to prove their claims to Helvetic Management Services
Limited, 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.
Paris Hotel's shareholders agreed on Jan. 1, 2008, to place the
company into voluntary liquidation under The Companies Law (2004
Revision) of the Cayman Islands.
The liquidator can be reached at:
Helvetic Management Services Limited
Attn: Colin G. Shaw
Alamander Way, Grand Pavilion
P.O. Box 31083, Grand Cayman KY1-1205
Cayman Islands
Phone: 945-3301
Fax: 945-3302
THE AIDA C FUND LIMITED: Proofs of Claim Filing Ends on March 6
---------------------------------------------------------------
The Aida C Fund Limited's creditors have until March 6, 2008, to
prove their claims to Richard Gordon and Joshua Grant, 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.
The Aida C's shareholder decided on Jan. 11, 2008, to place the
company into voluntary liquidation under The Companies Law (2004
Revision) of the Cayman Islands.
The liquidators can be reached at:
Richard Gordon and Joshua Grant
Maples Finance Limited
P.O. Box 1093, George Town
Grand Cayman, Cayman Islands
=========
C H I L E
=========
BUCYRUS INTERNATIONAL: Amends RAG Coal Share Purchase Deal
----------------------------------------------------------
On Feb. 18, 2008, Bucyrus International Inc. and its special-
purpose acquisition subsidiary, DBT Holdings GmbH, entered into
a Third Addendum to the Dec. 16, 2006 Share Purchase Agreement
with RAG Coal International GmbH, pursuant to which the company
purchased the shares of DBT GmbH on May 4, 2007.
In accordance with this amendment, the parties agreed to a cash
settlement of certain of the company's indemnification claims
against the RAG Coal under the Agreement, in exchange for the
company agreeing to an accelerated release of the lock-up and
transfer restrictions on the 471,476 shares of the company's
class A common stock issued to the RAG Coal pursuant to the
Agreement.
Under the original Agreement, with certain limited exceptions,
RAG Coal could not, without the company's prior written consent,
directly or indirectly sell or otherwise transfer (i) any of its
company shares prior to May 4, 2008; (ii) more than 30% of its
company shares prior to May 4, 2009; and (iii) more than 60% of
its company shares prior to May 4, 2010. Under the terms of the
Amendment, RAG Coal may now sell or transfer (subject to certain
requirements to help ensure an orderly market distribution) up
to 50% of its company shares beginning on Feb. 15, 2008, with
the next 25% of its company shares eligible for sale on or after
May 4, 2009, and the final 25% eligible for sale on or after
May 4, 2010.
About Bucyrus International
Headquartered in South Milwaukee, Wisconsin, Bucyrus
International Inc. (Nasdaq: BUCY) -- http://www.bucyrus.com/--
is a global manufacturer of electric mining shovels, walking
draglines and rotary blasthole drills and provides aftermarket
replacement parts and services for these machines. In 2006, it
had sales of US$738 million. The company has operations in
Brazil, Chile, China and Europe.
* * *
Moody's Investors Service placed the company's long-term
corporate family rating at 'Ba3' in April 2007. The rating
still holds to date with a stable outlook.
HOST HOTELS: Fitch to Monitor Impact of $500MM Stock Repurchase
---------------------------------------------------------------
The Board of Directors of Host Hotels & Resorts, Inc. has
authorized a program for HST to repurchase up to US$500 million
of Host's common stock. While Fitch Ratings acknowledges that
the program does not obligate Host to repurchase any specific
number of shares and may be suspended at any time at
management's discretion, Fitch will monitor share repurchase
activity going forward and its impact on the company's debt-to-
adjusted EBITDA ratios and liquidity.
If the operating environment for lodging real estate investment
trusts were to continue to deteriorate in 2008 and Host pursues
aggressive share repurchase activity, Fitch may review its
ratings. Host's debt-to-adjusted EBITDA ratio, currently
calculated at 3.7 times by Fitch, gives Host some flexibility
for the company's current ratings. As Host considers exercising
share repurchases, Fitch will also monitor Host's RevPAR,
average daily rate, and average occupancy statistics, as well as
credit metrics such as unencumbered asset coverage and fixed-
charge coverage ratios, which are currently consistent with the
company's ratings.
Fitch's ratings for Host are:
Host Hotels & Resorts, Inc.
-- Issuer Default Rating 'BB+';
-- Preferred stock 'BB'.
Host Hotels & Resorts, L.P.
-- Bank credit facility 'BB+';
-- Senior unsecured notes 'BB+';
-- Exchangeable senior unsecured debentures 'BB+'.
The Rating Outlook is Stable.
Host Hotels & Resorts, Inc. -- http://www.hosthotels.com/--
(NYSE:HST) is a lodging real estate investment trust and owns
luxury and upper upscale hotels. The company currently owns 121
properties with approximately 64,000 rooms, and also holds a
minority interest in a joint venture that owns seven hotels in
Europe with approximately 2,700 rooms. Guided by a disciplined
approach to capital allocation and aggressive asset management,
the company partners with premium brands such as Marriott(R),
Ritz-Carlton(R), Westin(R), Sheraton(R), W(R), St. Regis(R), The
Luxury Collection(R), Hyatt(R), Fairmont(R), Four Seasons(R),
Hilton(R) and Swissotel(R) in the operation of properties in
over 50 major markets worldwide, including Chile, Mexico and
Italy.
===============
C O L O M B I A
===============
ECOPETROL: Investing US$38 Billion for Exploration & Production
---------------------------------------------------------------
A spokesperson of Colombian state-owned oil firm Ecopetrol told
Business News Americas that the company will invest US$38
billion for new exploration and production activities through
2015.
Ecopetrol disclosed last week that it would invest US$60 billion
through 2015. The US$38 billion is part of its US$60 billion
investment plan, BNamericas says, citing the spokesperson.
BNamericas relates that Ecopetrol will allot US$20 billion for
its downstream operations and US$2 billion for corporate
operations including information technology and human resources.
The spokesperson told BNamericas that Ecopetrol will use the new
investment to boost output to one million barrels of oil
equivalent per day by 2015 from the current 400,000 barrels of
oil equivalent per day. About 80% of the increased production
would come from crude oil, while 20% would be from natural gas.
Ecopetrol will drill an average of 28 wells per year through
2015, the report relates. The company had drilled 13 wells last
year and it will continue acquiring new reserves abroad,
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. Ecopetrol
produced 385,000 barrels a day of oil and gas in 2006 and has
330,000 barrels a day of refining capacity, according to the
company's Web site. In 2005 it produced about 60 percent of
Colombia's daily output.
* * *
As reported in the Troubled Company Reporter-Latin America on
Nov. 6, 2007, Fitch Ratings affirmed Ecopetrol S.A.'s foreign
and local currency issuer default ratings at 'BB+' and 'BBB-',
respectively.
SOLUTIA INC: Drops Suit After Banks Recommit on Exit Financing
--------------------------------------------------------------
Solutia Inc. has entered an agreement to withdraw its lawsuit
against Citigroup Inc., Goldman Sachs Group Inc. and Deutsche
Bank AG after the banks reiterated their commitment to fund the
company's exit financing, Jeffrey McCracken writes for the Wall
Street Journal, citing people privy with the matter.
WSJ reports, citing a source that Solutia also agreed to some
renegotiated terms, which could raise the cost of the loan for
the company, but keep it "substantially the same."
The banks, in return, agreed to provide US$2.05 billion in exit
financing, around US$50 million more than the original loan, WSJ
relates. The bank will fund the loan on Feb. 28, 2008, when
Solutia expects to emerge from Chapter 11 bankruptcy.
The banks also agreed to waive the "materially adverse
condition" clause in the loan that they cited as reasons for
backing out from the the original agreement, the sources added
to WSJ.
The Down Jones Newswires reports that following the settlement,
Solutia has received a US$1.2 billion senior secured term loan
facility Citigroup Global Markets Inc., Goldman Sachs Credit
Partners LP and Deutsche Bank Securities Inc.
As reported in the TCR-Europe on Feb. 8, 2008, Solutia Inc.
filed a complaint in the U.S. Bankruptcy Court for the Southern
District of New York against the banks that had refused to meet
commitment to fund a US$2 billion exit financing package for
Solutia.
The complaint asserted that the banks should be stopped from
invoking the clause they claim relieves them of their obligation
due to their improper conduct and misrepresentations to the
company, and further claims that the banks fraudulently induced
Solutia to enter into the initial engagement by promising that
the financing was firmly committed.
On Oct. 25, 2007, the banks executed a firm commitment to fund a
US$2 billion exit financing package for Solutia. These
substantial, custom credit facilities and arrangements were
specifically tailored to facilitate Solutia's prompt emergence
from Chapter 11. On Nov. 20, 2007, the bankruptcy court
approved the exit financing package. Nine days later, in
reliance on the banks' firm lending commitment, the court found
the plan of reorganization to be feasible and confirmed the
plan.
In late January 2008, -- shortly before the anticipated closing
of the exit facility and Solutia's long-awaited emergence from
Chapter 11 -- the banks notified the company that they were
refusing to provide the funding, citing a so-called "market MAC"
provision in their commitment letter and asserting that there
has been a change in the markets since entering into the
commitment.
About Solutia Inc.
Headquartered in St. Louis, Missouri, Solutia Inc. (OTCBB:SOLUQ)
-- http://www.solutia.com/-- and its subsidiaries, engage in
the manufacture and sale of chemical-based materials, which are
used in consumer and industrial applications worldwide. Solutia
has operations in Malaysia, China, Singapore, Belgium, and
Colombia.
The company and 15 debtor-affiliates filed for chapter 11
protection on Dec. 17, 2003 (Bankr. S.D.N.Y. Case No. 03-17949).
When the Debtors filed for protection from their creditors, they
listed US$2,854,000,000 in assets and US$3,223,000,000 in debts.
Solutia is represented by Richard M. Cieri, Esq., Jonathan S.
Henes, Esq., and Michael A. Cohen, Esq., at Kirkland & Ellis
LLP, in New York, as lead bankruptcy counsel, and David A.
Warfield, Esq., and Laura Toledo, Esq., at Blackwell Sanders
LLP, in St. Louis Missouri, as special counsel. Trumbull Group
LLC is the Debtor's claims and noticing agent. Daniel H.
Golden, Esq., Ira S. Dizengoff, Esq., and Russel J. Reid, Esq.,
at Akin Gump Strauss Hauer & Feld LLP represent the Official
Committee of Unsecured Creditors, and Derron S. Slonecker at
Houlihan Lokey Howard & Zukin Capital provides the Creditors'
Committee with financial advice. The Official Committee of
Retirees of Solutia, Inc., et al., is represented by Daniel D.
Doyle, Esq., Nicholas A. Franke, Esq., and David M. Brown, Esq.,
at Spencer Fane Britt & Browne, LLP, in St. Louis, Missouri, and
Frank M. Young, Esq., Thomas E. Reynolds, Esq., R. Scott
Williams, Esq., at Haskell Slaughter Young & Rediker, LLC, in
Birmingham, Alabama.
On Feb. 14, 2006, the Debtors filed their Reorganization Plan &
Disclosure Statement. On May 15, 2007, they filed an Amended
Reorganization Plan and on July 9, 2007, filed a 2nd Amended
Reorganization Plan. The Bankruptcy Court approved the Debtors'
amended Disclosure Statement on Oct. 19, 2007. On Oct. 22,
2007, the Debtor re-filed a Consensual Plan & Disclosure
Statement and on Nov. 29, 2007, the Court confirmed the Debtors'
Consensual Plan.
* * *
As reported in the Troubled Company Reporter-Latin America on
Dec. 10, 2007, Standard & Poor's Ratings Services assigned its
'B+' loan rating to Solutia Inc.'s (D/--/--) proposed US$1.2
billion senior secured term loan and a '3' recovery rating,
indicating the likelihood of a meaningful (50%-70%) recovery of
principal in the event of a payment default. The ratings are
based on preliminary terms and conditions. S&P also assigned
its 'B-' rating to the company's proposed US$400 million
unsecured notes.
Standard & Poor's expected to assign its 'B+' corporate credit
rating to Solutia if the company and its subsidiaries emerge
from Chapter 11 bankruptcy proceedings in early 2008 as planned.
S&P expect the outlook to be stable.
SOLUTIA INC: Court Delays Ruling on Citigroup CEO's Deposition
--------------------------------------------------------------
The Hon. Prudence Carter Beatty of the U.S. Bankruptcy Court in
the Southern District of New York has delayed a decision on the
deposition of Citigroup Inc. CEO Vikram Pandit over the bank's
decision to back out from its commitment to fund the company's
US$2 billion exit financing, The Associated Press reports.
Judge Beatty said Solutia's attorneys need to talk to executives
at Goldman Sachs Group Inc. and Deutsche Bank AG before she
rules on whether Mr. Pandit should be deposed.
"I'm still a little uncertain whether Pandit is the person who
has actual knowledge that would be useful in this case," Judge
Beatty was quoted by AP as saying.
On Oct. 31, 2007, Solutia received a fully underwritten
commitment for US$2 billion in exit financing from Citigroup
Global Markets Inc., Goldman Sachs Credit Partners L.P. and
Deutsche Bank Securities Inc., who would act as joint lead
arrangers and joint bookrunners for the exit facility. Solutia
would use the loan to pay certain creditors upon its emergence
from Chapter 11 and for the ongoing operations of the company
after emergence.
The exit financing package includes a US$400 million senior
secured asset-based revolving credit facility, a US$1.2 billion
senior secured term loan facility, and a US$400 million senior
unsecured bridge facility.
Denial
"I did not make the decision personally and have no personal
knowledge of how that decision was reached," Mr. Pandit said in
an affidavit.
Solutia said in court documents that a Citigroup lawyer told the
company's financial adviser Todd Snyder of Rothschild Inc. that
the Mr. Pandit made the decision to back out from the deal, AP
relates.
J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP, in New York, denied naming Mr. Pandit as the decision-
maker, AP says.
In an affidavit, Mr. Milmoe recalled telling Mr. Snyder that the
withdrawal "was not a casual or ad hoc decision by Citi."
Mr. Milmoe added that though Mr. Pandit's name was mentioned
during the conversation, he doesn't know how high up the
Citigroup chain of command the decision was made.
Judge Beatty said it's "unclear" if the conversation has
occurred.
"Maybe he thought he heard something he didn't hear," Judge
Beatty was quoted by AP as saying.
* * *
To accommodate Solutia's financing needs, the Court agreed to
commence the trial with respect to the Complaint on Feb. 21,
2008, and conclude it on February 26, Rosemary L. Klein,
Solutia's senior vice president, general counsel and secretary,
disclosed in a filing with the Securities and Exchange
Commission.
As previously reported, funding of the obligations under the
Commitment Letter by the Commitment Parties is a condition to
consummation of Solutia's confirmed Plan. The equity commitment
letter with respect to the creditor rights offering contains
closing conditions including that the effective date of
Solutia's Plan will have occurred by Feb. 28, 2008, according to
Ms. Klein.
No assurance can be given that Solutia will prevail in its
dispute with the Commitment Parties or that the Court will enter
an order in time to force closing by Feb. 28, 2008, Ms. Klein
states. Even if a timely order is entered, no assurance can be
given that the Commitment Parties would not be able to obtain a
stay pending appeal. Any of these factors could cause Solutia
to fail to meet a closing condition under the creditor rights
offering commitment, she adds.
About Solutia Inc.
Based in St. Louis, Missouri, Solutia Inc. (OTCBB:SOLUQ) --
http://www.solutia.com/-- and its subsidiaries, engage in the
manufacture and sale of chemical-based materials, which are used
in consumer and industrial applications worldwide. Solutia
has operations in Malaysia, China, Singapore, Belgium, and
Colombia.
The company and 15 debtor-affiliates filed for chapter 11
protection on Dec. 17, 2003 (Bankr. S.D.N.Y. Case No. 03-17949).
When the Debtors filed for protection from their creditors, they
listed US$2,854,000,000 in assets and US$3,223,000,000 in debts.
Solutia is represented by Richard M. Cieri, Esq., Jonathan S.
Henes, Esq., and Michael A. Cohen, Esq., at Kirkland & Ellis
LLP, in New York, as lead bankruptcy counsel, and David A.
Warfield, Esq., and Laura Toledo, Esq., at Blackwell Sanders
LLP, in St. Louis Missouri, as special counsel. Trumbull Group
LLC is the Debtor's claims and noticing agent. Daniel H.
Golden, Esq., Ira S. Dizengoff, Esq., and Russel J. Reid, Esq.,
at Akin Gump Strauss Hauer & Feld LLP represent the Official
Committee of Unsecured Creditors, and Derron S. Slonecker at
Houlihan Lokey Howard & Zukin Capital provides the Creditors'
Committee with financial advice. The Official Committee of
Retirees of Solutia, Inc., et al., is represented by Daniel D.
Doyle, Esq., Nicholas A. Franke, Esq., and David M. Brown, Esq.,
at Spencer Fane Britt & Browne, LLP, in St. Louis, Missouri, and
Frank M. Young, Esq., Thomas E. Reynolds, Esq., R. Scott
Williams, Esq., at Haskell Slaughter Young & Rediker, LLC, in
Birmingham, Alabama.
On Feb. 14, 2006, the Debtors filed their Reorganization Plan &
Disclosure Statement. On May 15, 2007, they filed an Amended
Reorganization Plan and on July 9, 2007, filed a 2nd Amended
Reorganization Plan. The Bankruptcy Court approved the Debtors'
amended Disclosure Statement on Oct. 19, 2007. On Oct. 22,
2007, the Debtor re-filed a Consensual Plan & Disclosure
Statement and on Nov. 29, 2007, the Court confirmed the Debtors'
Consensual Plan.
* * *
As reported in the Troubled Company Reporter-Latin America on
Dec. 10, 2007, Standard & Poor's Ratings Services assigned its
'B+' loan rating to Solutia Inc.'s (D/--/--) proposed US$1.2
billion senior secured term loan and a '3' recovery rating,
indicating the likelihood of a meaningful (50%-70%) recovery of
principal in the event of a payment default. The ratings are
based on preliminary terms and conditions. S&P also assigned
its 'B-' rating to the company's proposed US$400 million
unsecured notes.
Standard & Poor's expected to assign its 'B+' corporate credit
rating to Solutia if the company and its subsidiaries emerge
from Chapter 11 bankruptcy proceedings in early 2008 as planned.
S&P expect the outlook to be stable.
SOLUTIA INC: Gets Exit Financing; To Emerge Tomorrow
----------------------------------------------------
Solutia Inc. and its debtor-affiliates have reached an agreement
with Citigroup Global Markets Inc., Goldman Sachs Credit
Partners L.P., and Deutsche Bank Securities Inc. to fund
Solutia's exit financing package and has scheduled a closing
date on Feb. 28, 2008, at which time Solutia's plan of
reorganization will become effective and the company will emerge
from Chapter 11.
"We are extremely pleased to have reached an agreement on the
exit financing package that will result in Solutia's emergence
from Chapter 11," said Jeffry N. Quinn, chairman, president and
CEO of Solutia Inc. "Importantly, this agreement enables
Solutia to emerge with the plan of reorganization intact,
providing significant recoveries for our stakeholders and
providing a firm foundation for Solutia's future success."
Under the terms of the revised exit financing package, the banks
have agreed to waive the market material adverse change
provision that was contained within the original loan commitment
documents and increase the size of the senior secured asset-
based revolving credit facility from US$400 million to US$450
million. The banks will provide a US$1.2 billion senior secured
term loan facility at LIBOR plus 500 basis points with a minimum
LIBOR floor of 350 basis points for the first four years.
Additionally, the exit financing package includes a US$400
million senior unsecured bridge facility.
The total cost of the financing, as well as the available
liquidity of the company, is substantially consistent with the
projections that were included in the disclosure statement
previously approved by the U.S. Bankruptcy Court for the
Southern District of New York. Solutia has also agreed to
dismiss the lawsuit, with prejudice, that it filed on Feb. 6,
2008 against the banks once the exit financing is funded.
The parties have agreed to request that the Court authorize the
parties to enter into the revised exit financing package and
find that the revisions are substantially consistent with the
order confirming the company's plan of reorganization that was
previously approved by the court on Nov. 29, 2007.
About Solutia Inc.
Based in St. Louis, Missouri, Solutia Inc.
(OTCBB:SOLUQ)(NYSE:SOA-WI) -- http://www.solutia.com/-- and its
subsidiaries, engage in the manufacture and sale of chemical-
based materials, which are used in consumer and industrial
applications worldwide. Solutia has operations in Malaysia,
China, Singapore, Belgium, and Colombia.
The company and 15 debtor-affiliates filed for chapter 11
protection on Dec. 17, 2003 (Bankr. S.D.N.Y. Lead Case No. 03-
17949). When the Debtors filed for protection from their
creditors, they listed US$2,854,000,000 in assets and
US$3,223,000,000 in debts.
Solutia is represented by Richard M. Cieri, Esq., Jonathan S.
Henes, Esq., and Michael A. Cohen, Esq., at Kirkland & Ellis
LLP, in New York, as lead bankruptcy counsel, and David A.
Warfield, Esq., and Laura Toledo, Esq., at Blackwell Sanders
LLP, in St. Louis Missouri, as special counsel. Trumbull Group
LLC is the Debtor's claims and noticing agent. Daniel H.
Golden, Esq., Ira S. Dizengoff, Esq., and Russel J. Reid, Esq.,
at Akin Gump Strauss Hauer & Feld LLP represent the Official
Committee of Unsecured Creditors, and Derron S. Slonecker at
Houlihan Lokey Howard & Zukin Capital provides the Creditors'
Committee with financial advice. The Official Committee of
Retirees of Solutia, Inc., et al., is represented by Daniel D.
Doyle, Esq., Nicholas A. Franke, Esq., and David M. Brown, Esq.,
at Spencer Fane Britt & Browne, LLP, in St. Louis, Missouri, and
Frank M. Young, Esq., Thomas E. Reynolds, Esq., R. Scott
Williams, Esq., at Haskell Slaughter Young & Rediker, LLC, in
Birmingham, Alabama.
On Feb. 14, 2006, the Debtors filed their Reorganization Plan &
Disclosure Statement. On May 15, 2007, they filed an Amended
Reorganization Plan and on July 9, 2007, filed a 2nd Amended
Reorganization Plan. The Bankruptcy Court approved the Debtors'
amended Disclosure Statement on Oct. 19, 2007. On Oct. 22,
2007, the Debtor re-filed a Consensual Plan & Disclosure
Statement and on Nov. 29, 2007, the Court confirmed the Debtors'
Consensual Plan.
* * *
As reported in the Troubled Company Reporter-Latin America on
Dec. 10, 2007, Standard & Poor's Ratings Services assigned its
'B+' loan rating to Solutia Inc.'s (D/--/--) proposed US$1.2
billion senior secured term loan and a '3' recovery rating,
indicating the likelihood of a meaningful (50%-70%) recovery of
principal in the event of a payment default. The ratings are
based on preliminary terms and conditions. S&P also assigned
its 'B-' rating to the company's proposed US$400 million
unsecured notes.
Standard & Poor's expected to assign its 'B+' corporate credit
rating to Solutia if the company and its subsidiaries emerge
from Chapter 11 bankruptcy proceedings in early 2008 as planned.
S&P expect the outlook to be stable.
==================
C O S T A R I C A
==================
SIRVA INC: U.S. Trustee Appoints Unsecured Creditors' Committee
---------------------------------------------------------------
Diana G. Adams, the United States Trustee for Region 2,
appointed five creditors to the Official Committee of Unsecured
Creditors in the Chapter 11 cases of Sirva Inc. and its debtor-
affiliates:
1. Owner Operator Independent Drivers Association
INW OOIDA Drive
Grain Valley, Missouri 64029
Attn: James Johnston
Tel: (800)444-5791
2. Natalie Hutt
c/o Mark C. Tanenbaum, Esq.
241-243 East Bay Street
Charleston, South Carolina 24913-0757
Tel: (843)577-5100
3. AboveNet Communication Inc.
as a member of and on behalf of The Official Committee of
Unsecured of 360networks (USA) Inc. et al., on behalf of
itself and 360networks (USA) Inc.
and 360fiber Inc. and their debtor subsidiaries
c/o AboveNet Communications, Inc.
360 Hamilton Avenue
White Plains, New York 10601
Attn: Lisa Gugliada
4. Team relocations Limited
Drury Way, London
NW10 OJN, United Kingdom
Attn: Timothy Romer
5. Beltmann Group Incorporated
2480 Long Lake Road
Roseville, Minnesota 55113
Attn: Dann W. Battina
Tel: (651)639-2989
About SIRVA Inc.
Headquartered in Westmont, Illinois, SIRVA Inc. (Pink Sheets :
SIRV.PK) -- http://www.sirva.com/-- is a provider of relocation
solutions to a well-established and diverse customer base. The
company handles all aspects of relocation, including home
purchase and home sale services, household goods moving,
mortgage services and home closing and settlement services.
SIRVA conducts more than 300,000 relocations per year,
transferring corporate and government employees along with
individual consumers. SIRVA's brands include Allied, Allied
International, Allied Pickfords, Allied Special Products, DJK
Residential, Global, northAmerican, northAmerican International,
Pickfords, SIRVA Mortgage, SIRVA Relocation and SIRVA
Settlement. The company has operations in Costa Rica.
The company and 61 of its affiliates filed separate petitions
for Chapter 11 protection on Feb. 5, 2008 (Bankr. S.D.N.Y. Case
No. 08-10433). Marc Kieselstein, Esq. at Kirkland & Ellis,
L.L.P. is representing the Debtor. An official Committee of
Unsecured Creditors has been appointed in this case. When the
Debtors filed for bankruptcy, it reported total assets of
US$924,457,299 and total debts of US$1,232,566,813 for the
quarter ended Sept. 30, 2007.
(Sirva Inc. Bankruptcy News, Issue No. 5; Bankruptcy Creditors'
Services Inc. http://bankrupt.com/newsstand/or 215/945-7000)
SIRVA INC: Planned Conflicts Firm Rebuts US Trustee's Objection
---------------------------------------------------------------
Togut Segal & Segal LLP, the firm that Sirva Inc. and its
debtor-affiliates propose to hire as conflicts counsel,
responded to the objection raised by the U.S. Trustee for
Region 2.
As reported in the Troubled Company Reporter on Feb. 13, 2008,
the Debtors propose that Togut Segal will perform services on
matters that the Debtors may encounter which are not
appropriately handled by Kirkland & Ellis LLP, the Debtors'
proposed counsel, and other professionals because of a potential
conflict of interest or, alternatively, which can be more
efficiently handled by the firm.
Eryk J. Spytek, senior vice president, general counsel and
secretary of SIRVA, clarifies that Togut Segal will not perform
the usual scope of services, other than to maintain a
familiarity with the case and progress of the Debtors'
reorganization. In the event there is a conflict of interest
requiring immediate attention, the firm is able to assume its
duties without impeding the progress of the bankruptcy case.
As reported in the Troubled Company Reporter on Feb. 15, 2008,
the U.S. Trustee for Region 2 objected to the employment of
Togut Segal & Segal as conflicts counsel.
"[T]he Debtors have not disclosed any conflicts necessitating
the employment of conflicts counsel," Diana G. Adams, United
States Trustee for Region 2, tells the Court.
Togut Segal & Segal seeks to perform services upon the approval
of its retention, which at this juncture would solely be to
enable to stay ahead of the learning curve to obviate the need
for them to come up to speed later in the case if an actual
conflict is disclosed, Paul K. Schwartzberg, Esq., trial
attorney for the U.S. Trustee, says.
Mr. Schwartzberg argues that the determinative question in
approving the employment of a professional is whether it is
reasonably necessary to have that professional employed.
Togut Disagrees with U.S. Trustee
Albert Togut, Esq., senior member of Togut, Segal & Segal, tells
Judge James M. Peck that a conflicts counsel is necessary to
satisfy the requirements of Section 327(a) of the Bankruptcy
Code, providing for the disinterestedness of the Debtors'
general bankruptcy counsel.
Mr. Togut says it can be a challenge for Kirkland & Ellis which
has 1,400 lawyers, offices in Chicago, New York, Washington,
D.C., Los Angeles, San Francisco, London, Munich and Hong Kong,
more than US$1,000,000,000 in revenues, and every kind of
client.
Mr. Togut pointed out that since the Debtors have 60,000
creditors, 3,200 employees, 50 subsidiaries, and more than
US$4,000,000,000 in revenues, it is possible that prior to
confirmation, there can be a conflict between these complex
business structures.
The purpose of conflicts counsel, Mr. Togut explains, is
recognized as necessary "to ensure the integrity of these highly
complex reorganization cases, especially where there is a mega-
debtor, and a mega-lawfirm as its counsel."
Togut Segal specializes in being conflicts counsel, and have no
regular retainers, Mr. Togut adds.
The existence of a conflicts counsel avoids any arguments that
the Debtors' counsel is favoring one of its regular clients over
the interests of the estate, Mr. Togut relates, citing In re
Oneida Ltd., et al., 06-10489 (ALG).
According to Mr. Togut, bringing the conflicts counsel into the
case in the beginning allows it to familiarize with the
contested matters especially in multi-billion dollar, fast-track
cases. It will also be cost-effective, since the Debtors can
rely on the conflicts counsel's judgment on what to do, when to
do it, and how much effort needs to be expended as the case
unfolds.
In addition, the Debtors have agreed that the Togut Segal's fees
and expenses should not be subject to any terms or conditions
other than as provided in their agreement, and in accordance
with the Bankruptcy Code and Bankruptcy Rules, Mr. Togut
insists, and the U.S. Trustee's judgment should not substitute
for the Debtors' business judgment.
Mr. Togut maintains that Togut Segal intends to provide
irreducible minimum services, and will not "duplicate Kirkland's
fine efforts."
About SIRVA Inc.
Headquartered in Westmont, Illinois, SIRVA Inc. (Pink Sheets :
SIRV.PK) -- http://www.sirva.com/-- is a provider of relocation
solutions to a well-established and diverse customer base. The
company handles all aspects of relocation, including home
purchase and home sale services, household goods moving,
mortgage services and home closing and settlement services.
SIRVA conducts more than 300,000 relocations per year,
transferring corporate and government employees along with
individual consumers. SIRVA's brands include Allied, Allied
International, Allied Pickfords, Allied Special Products, DJK
Residential, Global, northAmerican, northAmerican International,
Pickfords, SIRVA Mortgage, SIRVA Relocation and SIRVA
Settlement. The company has operation in Costa Rica.
The company and 61 of its affiliates filed separate petitions
for Chapter 11 protection on Feb. 5, 2008 (Bankr. S.D.N.Y. Case
No. 08-10433). Marc Kieselstein, Esq. at Kirkland & Ellis,
L.L.P. is representing the Debtor. An official Committee of
Unsecured Creditors has been appointed in this case. When the
Debtors filed for bankruptcy, it reported total assets of
US$924,457,299 and total debts of US$1,232,566,813 for the
quarter ended Sept. 30, 2007.
(Sirva Inc. Bankruptcy News, Issue No. 5; Bankruptcy Creditors'
Services Inc. http://bankrupt.com/newsstand/or 215/945-7000)
SIRVA INC: 360networks Committee Wants Claims Order Vacated
-----------------------------------------------------------
The Official Committee of Unsecured Creditors of 360networks
(USA) Inc. and its debtor-subsidiaries asks the U.S. Bankruptcy
Court for the Southern District of New York to reconsider its
order authorizing the payment of Sirva Inc.'s and its debtor-
affiliates' pre-bankruptcy filing unsecured claims dated Feb. 5,
2008, pursuant to Rules 59 and 60 of the Federal Rules of Civil
Procedure.
The 360networks Committee holds an unliquidated claim against
Debtor SIRVA Relocation LLC resulting from an action captioned
"The Official Committee of Unsecured Creditors of 360networks
(USA) Inc., et al. v. U.S. Relocation Services, Inc.," Adv. Pro.
No. 03-03127 (ALG), pending before Judge Allan L. Gropper before
the United States Bankruptcy Court for the Southern District of
New York.
In the Preference Action before Judge Gropper, the 360networks
Committee, on behalf of itself and 360networks (USA), Inc., and
360fiber Inc. and their debtor subsidiaries, are seeking the
avoidance, recovery and return, from U.S. Relocation Services,
Inc. -- now known as SIRVA Relocation LLC -- of US$1,863,014 in
preferential transfers made by 360 to U.S. Relocation, plus
prejudgment interest at the highest applicable rate from
March 26, 2002, plus sanctions in connection with counsel for
U.S. Relocation's conduct in defending the Preference Action,
for a total claim against U.S. Relocation estimated to be in the
excess of US$2,200,000.
The Preference Action, prior to it being stayed by the
commencement of the bankruptcy proceedings, had been sub judice
with Judge Gropper on fully-briefed cross motions for summary
judgment.
Norman N. Kinel, Esq., at Dreier LLP in New York, asserts that
the Debtors' proposed treatment of unsecured creditors is
discriminatory and impermissible under applicable law. The
Debtors propose, in their Plan of Reorganization dated Jan. 28,
2008, that in the two classes of unsecured creditors -- one will
receive a 100% distribution, and the other will receive no
distribution.
Mr. Kinel explains that although debtors are permitted to pay
unsecured prepetition debts to critical vendors, the relief
sought and obtained by the Debtors in the Prepetition Claims
Order classifies an open-ended category of creditors as
critical, without adequate basis.
Moreover, the Prepetition Claims Order was entered without due
notice to the parties-in-interest that are adversely affected,
including the 360networks Committee, depriving them of the
opportunity to object or be heard, Mr. Kinel states.
"[T]he 360networks Committee is not even listed as a creditor in
the Debtors' list of thirty (30) largest creditors attached to
their petitions, even though the 360networks Committee is in
fact one of the 10 largest creditors of the Debtors,
notwithstanding that such claim is presently unliquidated,"
Mr. Kinel maintains.
About SIRVA Inc.
Headquartered in Westmont, Illinois, SIRVA Inc. (Pink Sheets :
SIRV.PK) -- http://www.sirva.com/-- is a provider of relocation
solutions to a well-established and diverse customer base. The
company handles all aspects of relocation, including home
purchase and home sale services, household goods moving,
mortgage services and home closing and settlement services.
SIRVA conducts more than 300,000 relocations per year,
transferring corporate and government employees along with
individual consumers. SIRVA's brands include Allied, Allied
International, Allied Pickfords, Allied Special Products, DJK
Residential, Global, northAmerican, northAmerican International,
Pickfords, SIRVA Mortgage, SIRVA Relocation and SIRVA
Settlement. The company has operations in Costa Rica.
The company and 61 of its affiliates filed separate petitions
for Chapter 11 protection on Feb. 5, 2008 (Bankr. S.D.N.Y. Case
No. 08-10433). Marc Kieselstein, Esq. at Kirkland & Ellis,
L.L.P. is representing the Debtor. An official Committee of
Unsecured Creditors has been appointed in this case. When the
Debtors filed for bankruptcy, it reported total assets of
US$924,457,299 and total debts of US$1,232,566,813 for the
quarter ended Sept. 30, 2007.
(Sirva Inc. Bankruptcy News, Issue No. 5; Bankruptcy Creditors'
Services Inc. http://bankrupt.com/newsstand/or 215/945-7000)
===================================
D O M I N I C A N R E P U B L I C
===================================
PRC LLC: Creditors Panel Wants More Time to Review DIP Financing
----------------------------------------------------------------
The Official Committee of Unsecured Creditors in PRC LLC and its
debtor-affiliates' Chapter 11 cases asks the U.S. Bankruptcy
Court for the Southern District of New York to extend, until
Feb. 27, 2008, the final hearing to consider the Debtors'
postpetition financing facility, in order to allow the Committee
a fair opportunity to review the DIP Facility.
The Committee asserts that the DIP Financing Motion has global
and far-reaching implications.
The Debtors sought Court authority to borrow up to US$30,000,000
in postpetition financing from The Royal Bank of Scotland plc
and certain other lenders. RBS and the other lenders are also
the Debtors' prepetition lenders.
"The proposed Final DIP Order, when viewed in conjunction with
the Plan Term Sheet and Lock-Up, is in effect a sub rosa plan,
the complete control over which is placed in the hands of the
Debtors' Lenders at the very early stages of these cases,
without a disclosure statement or the benefit of an opportunity
for the Creditors Committee to perform its fiduciary duties,"
Andrew B. Eckstein, Esq., at Blank Rome LLP, in New York,
asserts.
The Plan Term Sheet was presented by the Debtors to the Court on
the bankruptcy filing. The Plan Term Sheet contemplates that on
the Plan Effective Date, the Lenders will be fully paid by an
exit facility of up to US$40,000,000 to US$45,000,000. The Plan
Term Sheet also describes a Lock-Up between the Debtors and the
Prepetition Lenders, which requires the Debtors to support the
material terms of the Plan. "[T]hese circumstances require
additional review and discovery," Mr. Eckstein maintains.
Moreover, it is uncertain whether unsecured creditors will
receive any distribution from the pre-negotiated Plan, Mr.
Eckstein contends.
The adjournment of the hearing will not affect the Debtors'
ability to operate, as the Court has already granted them an
interim funding of up to US$10,000,000, the Committee notes.
Mr. Eckstein also argues that the DIP Financing Motion is
objectionable on these grounds:
(1) The imposition of Plan terms which turn over to the
Lenders the debt and equity of the Debtors and complete
control of the reorganization process at the inception
of these cases is incongruous with the Bankruptcy Code
provisions regarding disclosure and due process.
(2) The Proposed Final DIP Order improperly seeks to skew the
outcome of the Debtors' cases in favor of the DIP
Lenders. It allows the Lenders to use the bankruptcy
process to extract value from the Debtors' assets to the
detriment of the unsecured creditors.
(3) The Prepetition Lenders should not be allowed payment of
professional fees and interest unless they can
demonstrate that they are oversecured -- an issue which
appears to be inconsistent with the Debtors' proposed
Plan Term Sheet.
In addition, the DIP Lenders have bargained for a
US$900,000 underwriter fee which is equal to 3% of the
DIP Facility. Because it is unclear if the Debtors will
need the full US$30,000,000, the underwriter fee is
strikingly high, Mr. Eckstein avers.
(4) Avoidance actions are designed to benefit the unsecured
creditors of the Debtors' estates. The DIP Lenders
should not be granted a lien on Avoidance Actions and
other causes of action. The granting of such liens will
effectively shield the Prepetition Lenders from
litigation.
(5) Limitations on investigation of claims against Lenders
should be stricken from the Proposed Final Order. The
Proposed Final DIP Order provides that, other than
US$25,000 that the Committee may use to investigate the
liens of the Prepetition Lenders, no portion of the DIP
Facility or the Carve-Out may be used to challenge the
amount and validity of the Lenders' liens.
(6) The waiver of the Debtors' rights under Section 506(c) of
the Bankruptcy Code to recover reasonable and necessary
costs of preserving and disposing of the Lenders'
collateral should be denied.
(7) The Committee should be provided with equal notice and
information as is afforded to the Lenders.
If the Court is inclined to place a cap on the Committee's
ability to investigate the prepetition activities between the
Debtors and the Prepetition Lenders, the Court should grant at
least US$150,000 to the Committee in order to allow it the
ability to carry out its fiduciary duties on behalf of the
creditors of the Debtors' estates, Mr. Eckstein maintains. "A
mere US$25,000 is woefully inadequate."
He adds that the Proposed Final DIP Order is also objectionable
in that it:
-- seeks to grant the Lenders relief from the automatic stay
five days after an Event of Default;
-- states that the DIP Lenders will bot be subject to the
doctrine of marshalling with respect to any Collateral;
-- states that the exception under Section 552(b) of the
Bankruptcy Code will not apply to the DIP Lenders with
respect to proceeds, offspring or profits of any of the
Collateral;
-- seeks to grant the Prepetition Lenders other adequate
protection as agreed upon by the Lenders and the Debtors.
This provision must be clarified.
Absent the hearing adjournment, the Committee further asked the
Court to deny the Debtors' request.
Debtors Talk Back
The Debtors maintain that they intend to confirm a Chapter 11
plan of reorganization. Every creditor will have the
opportunity to review that plan, cast a ballot, and object, if
they so desire, Alfredo R. Perez, Esq., at Weil, Gotshal &
Manges LLP, in Houston, Texas, avers. "The DIP Motion does not
replace or even thwart the confirmation process."
The Committee's contention that the DIP Motion effects a sub
rosa plan ignores the fact that the Committee will have ample
time at a later date to consider a Chapter 11 plan and whether
that plan deserves confirmation, Mr. Perez asserts.
Agreeing to promptly file a plan and disclosure statement in no
way places the Debtors at the complete mercy of their lenders,
Mr. Perez says. Rather, he states, it is prudent strategy that
recognizes that value for all stakeholders will be maximized if
the Debtors emerge from Chapter 11 as promptly as possible.
Mr. Perez also contends the other objections raised by the
Committee are misplaced. He emphasizes that:
* The payment of the Prepetition Lenders' fees, and interest
to the First Lienholders, represents an appropriate
concession that those creditors deserve adequate protection
against any diminution in the value of their collateral;
* Although the Committee complains of the liens placed on
Chapter 5 causes of action, the Debtors have neither
assigned nor lost control of those claims. Those liens
simply protect the DIP Lenders in the event of a default.
Otherwise, any proceeds of those actions remain property of
the estate and will be free and clear of all liens upon
repayment of the DIP Facility;
* It is hardly unreasonable for a lender to limit the amount
it will pay for an investigation of its own affairs.
Moreover, these estates should not be burdened by the
expense and delay that would be occasioned by a lengthy
fishing expedition in search of a claim;
* Waivers of Section 506(c) surcharge rights are entirely
appropriate because the DIP Lenders have offered new
consideration to the Debtors' estates in exchange for this
concession. Moreover, the Debtors' estates are poised for
reorganization, not a liquidation, of the Prepetition
Lenders' collateral. Thus, the policy concerns behind
those waivers are not at issue.
The Debtors have submitted a motion for financing under the best
terms available, Mr. Perez says. "None of the Committee's
objections refutes the essential fact that all creditors and
other stakeholders will benefit from the survival of the Debtors
as a going concern."
The Debtors also assert that the Final DIP Hearing should not be
adjourned. There is no statutory or other authority requiring
the Debtors to adhere to any schedule suggested by the
Committee, Mr. Perez says.
The Debtors further contend that they are working with the
Committee to provide information, subject to the execution of a
confidentiality agreement that is satisfactory in form and
substance to the Debtors.
About PRC LLC
Founded in 1982 and based in Fort Lauderdale, Florida, PRC, LLC
-- http://www.prcnet.com/-- is a leading provider of customer
management solutions. PRC markets its services to brand-
focused, Fortune 500 U.S. corporations and delivers these
services through a global network of call centers in the U.S.,
Philippines, India, and the Dominican Republic.
PRC is the sole member of each of PRC B2B, LLC, and Precision
Response of Pennsylvania, LLC, and the sole shareholder of
Access Direct Telemarketing, Inc., each of which is a debtor and
debtor-in-possession in PRC's joint Chapter 11 cases.
Panther/DCP Intermediate Holdings, LLC, is the sole member of
PRC.
PRC, together with its operating subsidiaries PRC B2B, Access
Direct, and PRC PA, is a leading provider of complex,
consultative, outsourced services in the Customer Care and Sales
& Marketing segments of the business process outsourcing
industry. Since 1982, the company has acquired and grown
customer relationships for some of the world's largest and most
brand-focused corporations in the financial services, media,
telecommunications, transportation, and retail industries.
The company and four of its affiliates filed for Chapter 11
protection on Jan. 23, 2008 (Bankr. S.D.N.Y. Lead Case No. 08-
10239). Alfredo R. Perez, Esq., at Weil, Gotshal & Manges, LLP,
represents the Debtors in their restructuring efforts. The
Debtors chose Stephen Dube, at CXO LLC, as their restructuring
and turnaround advisor. Additionally, Evercore Group LLC
provides investment and financial counsel to the Debtors.
The Debtors' consolidated financial condition as of Dec. 31,
2007 showed total assets of US$354,000,000 and total debts of
US$261,000,000.
The Debtors submitted to the Court a Chapter 11 Plan of
Reorganization on Feb. 12, 2008. (PRC LLC Bankruptcy News,
Issue No. 5; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
PRC LLC: Inks Pact Recognizing Law Debenture as Collateral Agent
----------------------------------------------------------------
PRC LLC and its debtor-affiliates, The Royal Bank of Scotland
plc, and Law Debenture Trust Company of New York entered into a
stipulation to permit the execution and filing of documents and
assignment of rights, powers and privileges from RBS to Law
Debenture as collateral andadministrative agent under a Second
Lien Credit Agreement.
Before the bankruptcy filing, RBS served as the collateral and
administrative agent for the First Lien Lenders under the
US$160,000,000 Amended and Restated First Lien Credit and
Guaranty Agreement, dated as of Nov. 29, 2006, as amended and
restated on Dec. 20, 2006, entered into by the Debtors. RBS,
however, tendered its resignation as agent, which became
effective Dec. 3, 2007.
The Debtors are also parties to a US$67,000,000 Amended and
Restated Second Lien Credit and Guaranty Agreement, dated as of
Nov. 29, 2006, as amended and restated on Dec. 20, 2006.
As of the bankruptcy filing, about US$119,400,000 was
outstanding under the First Lien Credit Agreement, and about
US$67,000,000 was outstanding under the Second Lien Credit
Agreement.
With consent from PRC, LLC, the Lenders appointed Law Debenture
as successor to RBS pursuant to a Successor Agent and Amendment
Agreement dated Jan. 18, 2008.
Due to time exigencies, certain documents evidencing the lien
transfers could not be filed before the bankruptcy filing. In
an abundance of caution, the parties agreed to enter into the
Stipulation.
The parties stipulate that they are authorized, and the
Debtors are directed, to enter into, deliver and file any
agreements, certificates and other documents, and take other
actions necessary to reflect the resignation of RBS and the
appointment of Law Debenture as administrative and collateral
agent. The automatic stay under Section 362 of the Bankruptcy
Code is modified to permit the execution and filing of the
documents.
Nothing in the Stipulation is construed to modify the terms of
any of the Second Lien Credit Agreement and related documents,
including the Intercreditor Agreement dated Nov. 29, 2006, or
to modify the obligations of any of the Debtors under the Second
Lien Loan Documents.
About PRC LLC
Founded in 1982 and based in Fort Lauderdale, Florida, PRC, LLC
-- http://www.prcnet.com/-- is a leading provider of customer
management solutions. PRC markets its services to brand-
focused, Fortune 500 U.S. corporations and delivers these
services through a global network of call centers in the U.S.,
Philippines, India, and the Dominican Republic.
PRC is the sole member of each of PRC B2B, LLC, and Precision
Response of Pennsylvania, LLC, and the sole shareholder of
Access Direct Telemarketing, Inc., each of which is a debtor and
debtor-in-possession in PRC's joint Chapter 11 cases.
Panther/DCP Intermediate Holdings, LLC, is the sole member of
PRC.
PRC, together with its operating subsidiaries PRC B2B, Access
Direct, and PRC PA, is a leading provider of complex,
consultative, outsourced services in the Customer Care and Sales
& Marketing segments of the business process outsourcing
industry. Since 1982, the company has acquired and grown
customer relationships for some of the world's largest and most
brand-focused corporations in the financial services, media,
telecommunications, transportation, and retail industries.
The company and four of its affiliates filed for Chapter 11
protection on Jan. 23, 2008 (Bankr. S.D.N.Y. Lead Case No. 08-
10239). Alfredo R. Perez, Esq., at Weil, Gotshal & Manges, LLP,
represents the Debtors in their restructuring efforts. The
Debtors chose Stephen Dube, at CXO LLC, as their restructuring
and turnaround advisor. Additionally, Evercore Group LLC
provides investment and financial counsel to the Debtors.
The Debtors' consolidated financial condition as of Dec. 31,
2007 showed total assets of US$354,000,000 and total debts of
US$261,000,000.
The Debtors submitted to the Court a Chapter 11 Plan of
Reorganization on Feb. 12, 2008. (PRC LLC Bankruptcy News,
Issue No. 5; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
PRC LLC: Court Okays Services Agreement With Advanced Contact
-------------------------------------------------------------
PRC LLC and its debtor-affiliates obtained authority from the
U.S. Bankruptcy Court for the Southern District of New York to
assume a services contract with Advanced Contact Solutions Inc.,
nunc pro tunc to Feb. 20, 2008.
The Debtors entered into a Master Services Agreement dated
Feb. 1, 2006, with Advanced Contact. Under the Agreement, ACS
provides representatives to answer inbound service-related
communication from the customers of the Debtors' clients. The
initial term of the Agreement is set to expire on Feb. 1, 2011.
Alfredo R. Perez, Esq., at Weil, Gotshal & Manges LLP, in
Houston, Texas, asserts that the assumption of the Agreement is
necessary to avoid any significant disruption on the Debtors'
business that would result if ACS ceased to provide services.
"If the Debtors were unable to continue their relationship under
the agreement, the Debtors would have to immediately invest
significant capital by hiring and training additional service
representatives and other production-related employees, in
addition to acquiring new contact centers, telephone lines, and
other business equipment to fulfill obligations under current
contracts with clients," Mr. Perez argues.
He further says that the Agreement is a substantial portion of
the Debtors' gross revenues, pointing out that the Debtors raked
in more than US$79,000,000 in gross revenue in 2007 based on
work
performed under the Agreement.
The Debtors also obtained the Court's approval to pay:
(i) ACS US$2,766,962 and US$4,310,306 on March 7 and April 4,
2008, for their prepetition defaults under the Agreement;
and
(ii) the balance of any cure amount in three monthly
installments starting May 2008.
However, in the event a Chapter 11 plan is confirmed, the
Debtors
are obliged to pay any remaining monthly installments on the day
that plan takes effect, the Court ruled.
According to Mr. Perez, the Debtors' ability to keep current on
their postpetition obligations combined with the cure payments
will serve as adequate assurance to ACS for future performance.
Objections to the proposed assumption of the ACS Agreement were
overruled by the Court, including the arguments raised by the
Official Committee of Unsecured Creditors. The Creditors
Committee expressed concerns over the unusually broad relief
sought by the Debtors given the early stage of their Chapter 11
cases.
Committee Files Conditional Objection
The Creditors Committee advised the Court about the possibility
of the Debtors' customers filing administrative claims in
connection with a possible rejection of their contracts. The
Committee urged the Court to include a ruling in its Final
Assumption Order, releasing PRC, LLC, from any liability for
those administrative claims other than payment in connection
with the services provided.
About PRC LLC
Founded in 1982 and based in Fort Lauderdale, Florida, PRC, LLC
-- http://www.prcnet.com/-- is a leading provider of customer
management solutions. PRC markets its services to brand-
focused, Fortune 500 U.S. corporations and delivers these
services through a global network of call centers in the U.S.,
Philippines, India, and the Dominican Republic.
PRC is the sole member of each of PRC B2B, LLC, and Precision
Response of Pennsylvania, LLC, and the sole shareholder of
Access Direct Telemarketing, Inc., each of which is a debtor and
debtor-in-possession in PRC's joint Chapter 11 cases.
Panther/DCP Intermediate Holdings, LLC, is the sole member of
PRC.
PRC, together with its operating subsidiaries PRC B2B, Access
Direct, and PRC PA, is a leading provider of complex,
consultative, outsourced services in the Customer Care and Sales
& Marketing segments of the business process outsourcing
industry. Since 1982, the company has acquired and grown
customer relationships for some of the world's largest and most
brand-focused corporations in the financial services, media,
telecommunications, transportation, and retail industries.
The company and four of its affiliates filed for Chapter 11
protection on Jan. 23, 2008 (Bankr. S.D.N.Y. Lead Case No. 08-
10239). Alfredo R. Perez, Esq., at Weil, Gotshal & Manges, LLP,
represents the Debtors in their restructuring efforts. The
Debtors chose Stephen Dube, at CXO LLC, as their restructuring
and turnaround advisor. Additionally, Evercore Group LLC
provides investment and financial counsel to the Debtors.
The Debtors' consolidated financial condition as of Dec. 31,
2007 showed total assets of US$354,000,000 and total debts of
US$261,000,000.
The Debtors submitted to the Court a Chapter 11 Plan of
Reorganization on Feb. 12, 2008. (PRC LLC Bankruptcy News,
Issue No. 5; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
=============
E C U A D O R
=============
PETROECUADOR: Sells Oriente & Napo Crude in Short-Term Contracts
----------------------------------------------------------------
Petroecuador said that it has sold 7.2 million barrels of
Oriente crude and 720,000 barrels of Napo crude in short-term
contracts.
Business News Americas relates that five lots of 720,000 barrels
went to:
-- Shell Trading,
-- Repsol YPF,
-- Petrochina, and
-- Trafigura.
According to BNamericas, the four oil companies offered spot
market price discounts from US$13.84 to US$15.62 per barrel.
The shipments will be made in March.
BNamericas notes that five other lots of 720,000 barrels each
were won by:
-- Trafigura,
-- Petrochina,
-- Petroperu, and
-- Arcadia.
These companies offered spot market price discounts from
US$12.98 to US$13.98 per barrel. The shipments will be made in
April, BNamericas states.
Headquartered in Quito, Ecuador, Petroecuador --
http://www.petroecuador.com.ec-- is an international oil
company owned by the Ecuador government. It produces crude
petroleum and natural gas.
* * *
In previous years, Petroecuador, according to published reports,
was faced with cash-problems. The state-oil firm has no funds
for maintenance, has no funds to repair pumps in diesel,
gasoline and natural gas refineries, and has no capacity to pay
suppliers and vendors. The government refused to give the much-
needed cash alleging inefficiency and non-transparency in
Petroecuador's dealings. In 2008, a new management team was
appointed to turn around the company's operations.
====================
E L S A L V A D O R
====================
ALCATEL-LUCENT SA: Inks O&M Services Deal With Brasil Telecom
-------------------------------------------------------------
Alcatel-Lucent has siged a major contract with Brasil Telecom to
provide Operations and Maintenance (O&M) services for the
carrier internal plant (including wireless, wireline and data
networks), as well as their outside plant. This project
reinforces the strategic partnership between Brasil Telecom and
Alcatel-Lucent, and solidifies the company's leadership in
providing operations and maintenance services for fixed, mobile
and data networks in Brazil.
This contract represents a milestone in Latin America as no
other company in the region is responsible for the whole
infrastructure of an operator. Brasil Telecom is pioneering
this field by selecting an experienced and capable supplier as
its partner to simplify and expand its business.
Based on the agreement Alcatel-Lucent will take care of 100
percent of Brasil Telecom infrastructure, including detailed O&M
for the operator's wireless network (voice, data and core);
switches and transmission for fixed land line; data
communications and ADSL (core and access); satellite platform;
infrastructure (building, AC/DC energy, air conditioning, towers
and poles); network management systems; and technical support
for all levels.
"This is the biggest contract signed by Brasil Telecom in the
last few years and we look forward to an exceptionally close
working relationship with Alcatel-Lucent as we strive to bring
out customers the most reliable and highest quality
communications services available," said Brasil Telecom
Operations Vice-President, Francisco Santiago. "Alcatel-Lucent
will take care of the whole operation and maintenance of our
fixed-line and wireless telephony infrastructure and we trust
their capacity for that. For us it's a new way of working,
creating a package of services that spans maintenance,
engineering, installation and operations to attain OPEX and
CAPEX reduction."
This new contract demonstrates the breadth and depth of Alcatel-
Lucent services portfolio, as it encompasses network consulting
and planning, network operations, optimization and maintenance.
Alcatel-Lucent is the main equipment and solution supplier for
Brasil Telecom and has also provided O&M services for the
operator since 2002.
Alcatel-Lucent plans to create a centralized technical
management center, implement process and organizational
improvements between outside plant and internal infrastructure,
and improve productivity at central management center level
through application of workforce management, improving existing
Operation System Support tools to better apply fault correlation
and automatic dispatching.
"This network services contract with Brasil Telecom builds upon
our long-term relationship with them, which is built on trust,
confidence and a spirit of partnership. Their decision to have
a single partner responsible for the operation and maintenance
of their network is quite visionary and is a pioneering strategy
by the operator, both in Brazil and the region," said President
of Alcatel-Lucent's activities in the Caribbean and Latin
America region, Victor Agnellini. "We are committed on
delivering the best services and an excellent experience for
Brasil Telecom and its customers by ensuring the reliability and
quality of the carrier's entire infrastructure. And we look
forward to welcoming the talented employees from Brasil Telecom
who will be joining Alcatel-Lucent to ensure we can leverage
their expertise to maintain the high quality of the service
Brasil Telecom provides."
Brasil Telecom is a leading telecommunications integrated
services provider and frontrunner player involved in bundle
fixed/mobile and broadband services in Brazil. With more than 8
million fixed line users and close to 4 million mobile
subscribers, as well as more than 1.7 million ADSL broadband
users, the operator's services cover a large portion of Brazil,
including the Federal District and the states of Acre, Rondonia,
Tocantins, Mato Grosso, Mato Grosso do Sul, Goias, Parana, Santa
Catarina, and Rio Grande Do Sul. It also offers nationwide and
international long-distance services.
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; intra-regional
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.
About Alcatel-Lucent
Headquartered in Paris, France, Alcatel-Lucent S.A. --
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.
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, Indonesia, Australia, Brunei and
Cambodia.
* * *
As reported on Nov. 9, 2007, Moody's Investors Service
downgraded to Ba3 from Ba2 the Corporate Family Rating of
Alcatel-Lucent. The ratings for senior debt of the group were
equally lowered to Ba3 from Ba2 and the trust preferred notes of
Lucent Technologies Capital Trust I have been downgraded to B2
from B1. At the same time, Moody's affirmed its Not-Prime
rating for short-term debt of Alcatel-Lucent. Moody's said the
outlook for the ratings is stable.
Alcatel-Lucent's Long-Term Corporate Credit rating and Senior
Unsecured Debt carry Standard & Poor's Ratings Services' BB
rating. Its Short-Term Corporate Credit rating stands at B.
===========
G U Y A N A
===========
FLOWSERVE CORP: Inks Strategic Cooperation Deal With Sinopec
------------------------------------------------------------
Flowserve Corporation has signed a strategic cooperation
agreement with China Petroleum & Chemical Corporation (Sinopec
Corp.).
New projects stemming from the agreement should lead to low-cost
sourcing initiatives and aftermarket programs to improve parts
and service support. The companies plan to share expertise in
the areas of quality management, equipment maintenance and
service techniques.
"This is a very important strategic agreement for Flowserve
considering Sinopec is one of the largest crude oil and natural
gas producers in China, the leading petrochemical producer and
distributor in China, and is among the world's largest
refiners," said Tom Ferguson, President of the Flowserve Pump
Division. "We look forward to serving future projects with
Sinopec with the highest quality rotating equipment and customer
service."
The agreement outlines plans for communication and information
sharing on operations management, market research and logistics
management. Additionally, the agreement establishes a project
committee representing both companies.
Flowserve will hold discussions with the Sinopec's project teams
and design institute regarding equipment selections and
specifications that will benefit both companies, while reducing
engineering costs.
Sinopec and Flowserve plan to utilize an electronic
communications network to facilitate procurement, job quoting,
contract signing, product consigning, logistics tracking and
project schedule tracking. Also, because of the resulting
business relationship, Sinopec will be able to enter orders
directly to Flowserve which will help eliminate unnecessary
costs.
About Flowserve
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 of Feb. 26, Flowserve Corporation carried Moody's Investors
Service's corporate family rating at Ba3, bank loan debt rating
at Ba2 and probability of default at B1.
=============
J A M A I C A
=============
CABLE & WIRELESS: Will Dismiss 100 Workers in Jamaica
-----------------------------------------------------
Cable & Wireless PLC told the Associated Press that will lay off
about 100 workers in Jamaica at the end of March as part of a
restructuring to better compete with competition.
Cable & Wireless spokesperson Errol Miller told the AP that the
layoffs will affect about 6% of the firm's 1,600 workers in
Jamaica.
Cable & Wireless wants to streamline Jamaican operations as it
faces increased competition, especially from Jamaica's Digicel
Group Ltd., the AP states.
Headquartered in London, Cable & Wireless Plc --
http://www.cw.com/new/-- provides voice, data and IP (Internet
Protocol) services to business and residential customers, as
well as services to other telecoms carriers, mobile operators
and providers of content, applications and Internet services.
The company has operations are in the United Kingdom, India,
China, the Cayman Islands and the Middle East.
* * *
In April 2007, in connection with the implementation of its new
Probability-of-Default and Loss-Given-Default rating methodology
for the corporate families in the Telecommunications, Media and
technology sector, Moody's Investors Service confirmed its Ba3
Corporate Family Rating for Cable & Wireless Plc. Moody's also
assigned a Ba3 Probability-of-Default rating to the company.
NATIONAL WATER: Says Hermitage Dam Water Storage Levels Drop
------------------------------------------------------------
The National Water Commission said that water storage levels at
the Hermitage Dam between Friday and Monday drastically dropped
by 5%, Radio Jamaica reports.
Radio Jamaica relates that the dam is in the Stony Hill region
of West Rural St. Andrew. The dam is at 69% of its capacity.
The Mona Reservoir has remained at 74% since Friday, Radio
Jamaica notes, citing the National Water's Acting Public
Relations Manager Lisa Golding.
The Commission has implemented several water management measures
including water restrictions, Ms. Golding told Radio Jamaica.
The National Water Commission is a statutory organization
charged with the responsibility of providing potable water and
wastewater services for the people of Jamaica.
* * *
The National Water Commission of Jamaica had been criticized for
failing to act promptly in cutting its losses. For the fiscal
years 2002 and 2003, the water commission accumulated a net loss
of US$2.11 billion. The deficit fell to US$1.86 billion the
following year, and to US$670 million in 2004 and 2005.
Jamaican citizens have been complaining to the commission about
water disruptions in their communities, resulting to
restrictions of water use.
===========
M E X I C O
===========
ARROW ELECTRONICS: Inks Pact to Buy All of LOGIX Shares
-------------------------------------------------------
Arrow Electronics Inc. reported that its proposed acquisition of
LOGIX S.A., a subsidiary of Groupe OPEN, was approved by the
LOGIX works council and the company has signed a definitive
agreement pursuant to which Arrow will purchase 100 percent of
the shares of LOGIX. Arrow anticipated the acquisition will be
immediately accretive to earnings by US$0.02 to US$0.04 in the
first 12 months. The transaction is subject to customary
European Union competition clearance.
"LOGIX is a natural complement to our existing Enterprise
Computing Solutions business with its focus on the fast growing
mid-market and its best-in-class portfolio of solutions. This
transaction will expand our pan-European footprint and almost
double our line card, as well as strengthen existing
relationships with key suppliers. We will gain an experienced
management team and 350 highly talented sales, marketing and
design professionals, while LOGIX will obtain access to
increased financial and technical resources, and a more
comprehensive suite of solutions for its reseller partners,"
said William E. Mitchell, chairman, president and chief
executive officer.
About LOGIX
LOGIX is a leading value-added distributor of midrange servers,
storage, and software in 11 European countries with annual gross
revenues of approximately 500 million euros. Headquartered in
Courbevoie, France, LOGIX has operations in France, Belgium,
Luxembourg, Morocco, Poland, the Netherlands, Israel, Denmark,
Finland, Sweden, and Norway, bringing Arrow Enterprise Computing
Solutions' global reach to 28 countries. Through approximately
500 employees, LOGIX provides a full range of value-added
distribution services, including demand creation, integration,
technical training, financing, marketing and logistics, to over
6,500 partners.
About Arrow Electronics
Headquartered in Melville, New York, Arrow Electronics Inc.
-- http://www.arrow.com/-- provides products, services and
solutions to industrial and commercial users of electronic
components and computer products. Arrow serves as a supply
channel partner for nearly 600 suppliers and more than 130,000
original equipment manufacturers, contract manufacturers and
commercial customers through a global network of over 270
locations in 53 countries and territories.
The company operates in France, Spain, Portugal, Denmark,
Estonia, Finland, Ireland, Latvia, Lithuania, Norway, Sweden,
Italy, Germany, Austria, Switzerland, Belgium, the Netherlands,
United Kingdom, Argentina, Brazil, Mexico, Australia, China,
Hong Kong, Korea, Philippines and Singapore.
* * *
Arrow Electronics senior subordinated stock continues to carry
Moody's Investors Service's Ba1 rating. The company's senior
preferred stock is rated at Ba2.
AXTEL SAB: Posts MXN81.6 million Comprehensive Loss in 4th Qtr.
---------------------------------------------------------------
Axtel, S.A.B. de C.V. Released its unaudited fourth quarter
results ended Dec. 31, 2007.
Highlights:
-- During the fourth quarter, Axtel entered into a supplier
agreement with Motorola to deploy WiMAX infrastructure
within its network.
-- In December 2007, the company signed a four-year extension
to continue providing local services, spectrum
utilization, long distance and 800 numbers to Nextel de
Mexico.
-- In 2007, Axtel reported MXN401.1 million in Free Cash
Flow, after maintenance and growth CAPEX. Free Cash Flow
after maintenance CAPEX was approximately MXN2,265.7
million.
-- During 2007, AXTELCPO's liquidity improved significantly,
advancing from 37th to 22nd place among the most active
stocks on the Bolsa Mexicana de Valores. This progress
enabled the company to become part of the IPC Index for
2008.
-- 2007 was another record year for the company, successfully
integrating Avantel, expanding its footprint into 10 new
cities, signing an important leasing capacity agreement
with CFE, and achieving its targeted EBITDA guidance for
the year.
Revenues
Local services:
Local service revenues contributed with 47% of total revenues
during the fourth quarter, compared with 53% in the fourth
quarter of 2006. The 20% growth reported in the fourth quarter
of 2007 versus year-earlier quarter is explained by 14%, 33% and
11% increases in monthly rents, cellular revenues and measured
service revenues, respectively. For the twelve-month period
ended Dec. 31, 2007, revenues from local services totaled
MXN5,336.6 million, an annual increase of MXN1,006.6 million, or
23%, from MXN4,330.0 million recorded in the same period in
2006. Monthly rents, measured service and value-added services
revenues represented 63% of local revenues during the twelve-
month period ended Dec. 31, 2007.
Long distance services:
Long distance service revenues totaled MXN357.7 million in the
quarter ending Dec. 31, 2007, representing an increase of
MXN151.3 million or 73%, from MXN206.5 million in the same
quarter in 2006. For the twelve month period ended Dec. 31,
2007, long distance services grew to MXN1,532.2 million from
MXN583.6 million registered in the same period in 2006, an
increase of MXN948.6 million or 163%.
Data & Network:
Driven by managed Internet services and virtual private
networks, data and network revenues grew to MXN620.1 million
for the three- month period ended Dec. 31, 2007, compared to
MXN249.2 million in the same period in 2006, an increase of
MXN370.9 million. Dedicated Internet and VPNs represented 90%
of data & network revenues during the quarter. For the twelve
month period ended Dec. 31, 2007, data and network services
revenues totaled MXN2,513.8 million from MXN459.1 million
registered in the same period in 2006, an increase of MXN2,054.7
million.
International traffic:
In the fourth quarter of 2007, International traffic revenues
increased MXN85.4 million or 46% versus year-earlier quarter.
For the twelve month period ended Dec. 31, 2007, international
traffic revenues totaled MXN1,210.2 million from MXN552.8
million registered in the same period in 2006, an increase of
MXN657.4 million or 119%.
Other services:
Revenue from other services represented 11% or MXN342.9 million
of total revenues in the fourth quarter of 2007, compared to
MXN377.5 million registered in the same period in 2006. The
reduction is explained by the one-time cancellation of
approximately MXN40 million in revenues due to renegotiation of
the Nextel agreement and by changes in federal government's
expenditure programs. Prior to 2007, federal government's
expenditures were significantly concentrated towards year-end,
while starting in 2007, expenditures are more evenly distributed
throughout the life of the contracts.
Consumption
Local Calls:
Local calls totaled 624 million in the three-month period ended
Dec. 31, 2007, an increase of 94.1 million, or 18%, from 529.9
million recorded in the same period in 2006. More lines in
service, commercial bundles including additional local calls and
the contribution from Avantel not recorded in October and
November 2006 were the main drivers for this increase. For the
twelve month period ended Dec. 31, 2007, local calls increased
to 2,466 million from 1,964.9 million registered in the same
period in 2006, an increase of 501.1 million calls or 26%.
Cellular (Calling Party Pays):
Minutes of use of calls completed to a cellular line amounted to
315.4 million in the three-month period ended Dec. 31, 2007,
compared to 217.1 million in the same period in 2006, a 45%
improvement equivalent to 98.3 million minutes. The increased
cellular traffic in the fourth quarter is explained by
commercial promotionsimplemented by one of Axtel's largest
customers. For the twelve month period ended Dec. 31, 2007,
cellular minutes grew 318.8 million, or 41%, from 779.9 million
registered in the twelve-month period ended Dec. 31, 2006, to
1,098.7 million in the same period in 2007.
Long distance:
Outgoing long distance minutes increased to 430.8 million for
the three-month period ended Dec. 31, 2007 from 270.2 million in
the same period in 2006, 160.6 million minutes above. This
increase is explained by the consolidation of Avantel not
reflected in October and November 2006 and by the continued
penetration of bundled commercial offers that incorporate long
distance minutes. Domestic long distance minutes continue
representing 94% of total traffic during the quarter. For the
twelve month period ended Dec. 31, 2007, outgoing long distance
minutes amounted 1,910 million, compared to 695 million
registered in the same period in 2006, an increase of 1,215
million of minutes, or 175%.
Operating Data
Lines in Service:
As of Dec. 31, 2007, lines in service totaled 932.3 thousand, an
increase of 139.8 thousand from the same date in 2006. During
the fourth quarter of 2007, net additional lines totaled 47.6
thousand, of which approximately 21 thousand were contributed by
the ten new cities launched in 2007. Lines in service from
these cities launched in 2007 represented 4% of total lines in
service. As of Dec. 31, 2007; residential lines represented 67%
of total lines in service.
Line equivalents (E0 equivalents):
Axtel offers from 64 kilobytes per second (kbps) up to 100
megabytes per second (Mbps) dedicated data links in all of its
existing cities. The company accounts for data links by
converting them to E0 equivalents in order to standardize its
comparisons versus the industry. As of Dec. 31, 2007, line
equivalents totaled 445.6 thousand, an increase of 29.3 thousand
from the same date in 2006.
Internet subscribers:
As of Dec. 31, 2007, Internet subscribers totaled 109,175, an
increase of 4%, from 104,703 recorded on the same date in 2006.
Broadband subscribers represented 69% or 75,693. Axtel
continues to upgrade customers from dial-up service to broadband
access solutions.
Cost of Revenues and Operating Expenses
Cost of Revenues:
For the three-month period ended Dec. 31, 2007, the cost of
revenues grew MXN381.5 million, compared with the same period of
year 2006, primarily due to MXN74.2 million, MXN180.7 million
and MXN194.7 million increases in fixed-to-mobile
interconnection costs, domestic long distance interconnection
and links & co-location costs, respectively. For the twelve
month period ended Dec. 31, 2007, the cost of revenues reached
MXN4,504.7 million, an increase of MXN2,400.4 million in
comparison with the same period in year 2006.
Gross Profit:
Gross profit is defined as revenues minus cost of revenues. For
the fourth quarter of 2007, the gross profit accounted for
MXN1,870.2 million, an increase of MXN428.3 million or 30%,
compared with the same period in year 2006. The reduction in
the margin for the quarter is explained by the increase in
cellular traffic which carries a lower margin and also from the
approximately MXN40 million one-time revenue cancellation
recorded during this period. For the twelve month period ended
Dec. 31, 2007, the company's gross profit totaled MXN7,685.9
million, compared to MXN4,571.4 million recorded in the same
period of year 2006, a gain of MXN3,114.5 million or 68%.
Operating expenses:
For the fourth quarter of year 2007, operating expenses grew
MXN134.8 million, or 18%, totaling MXN867.7 million compared to
MXN732.9 million for the same period in year 2006. Among
others, increases of MXN91.2 million, MXN20.1 million and 18.5
million in personnel, consulting and outsourcing and advertising
expenses, respectively, explain this growth. For the twelve
month period ended Dec. 31, 2007, operating expenses totaled
MXN3,601.4 million, coming from MXN2,260.1 million in the same
period in 2006, an increase of MXN1,341.3 million. Personnel
represented 49% of total operating expenses during the twelve
month period ended Dec. 31, 2007 versus 45% in the year-earlier
period.
Adjusted EBITDA
The Adjusted EBITDA totaled MXN1,002.5 million for the three-
month period ended Dec. 31, 2007, compared to MXN709.1 million
for the same period in 2006, an increase of 41%. As a
percentage of total revenues, adjusted EBITDA represented 33.6%
in the fourth quarter of 2007. For the twelve-month period
ended Dec. 31, 2007, adjusted EBITDA amounted to MXN4,084.5
million, compared to MXN2,311.2 million in the same period in
year 2006, a positive variation of MXN1,773.2 million, or 77%.
Depreciation and Amortization
Depreciation and amortization totaled MXN596.7 million in the
three-month period ended Dec. 31, 2007, compared to MXN453.2
million for the same period in year 2006, an increase of
MXN143.5 million or 32%, due to the organic expansion in 2007
and the consolidation of Avantel not reflected in October and
November 2006. Depreciation and amortization for the twelve-
month period ended Dec. 31, 2007 reached MXN2,690.7 million,
from MXN1,560.1 million in the same period in year 2006, an
increase of MXN1,130.6 million, or 72%.
Operating Income (Loss)
Operating income totaled MXN405.8 million in the three-month
period ended Dec. 31, 2007, compared to an operating income of
MXN255.9 million registered in the same period in year 2006, an
increase of MXN149.9 million or 59%. For the twelve-month
period ended Dec. 31, 2007, Axtel's operating income reached
MXN1,393.8 million when compared to the result registered in the
same period of year 2006 of MXN751.2 million, MXN642.6 million
or 86% above.
Comprehensive Financial Result
The comprehensive financial loss was MXN81.6 million for the
three-month period ended Dec. 31, 2007, compared to a loss of
MXN93.7 million for the same period in 2006. A net interest
expense increase of MXN49.3 million due to incremental
indebtedness offset by a monetary position gain of MXN109.7
million during the quarter, explain the majority of the CFR
increase. For the twelve-month period ended Dec. 31, 2007, the
incremental loss is explained by a net interest expense increase
of MXN400 million, an incremental monetary position gain
MXN256.7 million and a MXN44.8 increase in the valuation of
derivative.
Debt
The MXN717 million reduction of debt versus year-earlier date is
explained by the prepayment of Avantel's acquisition financing
with the 2017 Senior Notes and cash, the amortization of
principal under diverse lease obligations, prepayment of small
loans and lease obligations and a slightly more favorable
exchange rate on Dec. 31, 2007, compared to the same date in
2006.
Capital Investments
Continuing with its growth strategy, Axtel expanded its coverage
in existing cities, in addition to launching local operations in
ten new cities in 2007. The majority of its capital investments
are devoted to access or last-mile assets. In 2007, capital
investments totaled MXN2,486.1 million, versus MXN1,783.9
million in the previous year,excluding the acquisition of
Avantel and related accounting records.
About Axtel
Headquartered in Monterrey, Mexico, Axtel S.A.B. de C.V. (BMV:
AXTELCPO; OTC: AXTLY) was formerly known as Axtel SA DE CV. The
company's principal activity is providing local and long-
distance domestic and international telephony, data and Internet
services, virtual private networks and value added services.
Services include different access technologies such as fixed
wireless telephony, point-to-point and point-to-multi point
radio links, and copper and fiber optic connections. Basic
services are divided into 5 categories such as voice, conference
call, data, Internet and bundles. It offers basic
telecommunications infrastructure in Mexico through an
intelligent network that provides extensive coverage to all
markets. It currently operates in Mexico City, Monterrey,
Guadalajara, Puebla, Leon, Toluca, Queretaro, San Luis Potosi,
Aguascalientes, Saltillo, Ciudad Juarez, Tijuana, La Laguna,
Veracruz and Chihuahua.
* * *
As reported in the Troubled Company Reporter-Latin America on
Nov. 8, 2007, Moody's Investors Service upgraded Axtel, S.A.B.
de C.V.'s corporate family rating to Ba2 from Ba3 based on the
rapid improvement of the company's credit metrics to levels
prior to the acquisition of Avantel as well as expected
improvements in free cash flow generation. Moody's says the
outlook is now stable.
DURA AUTOMOTIVE: Court OKs Amendments to Revolving DIP Debt Pact
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware granted
final approval to Amendment No. 5 to Revolving DIP Credit
Agreement, dated as of Jan. 30, 2008, by and among the Debtors,
as Borrowers and Guarantors; General Electric Capital
Corporation, as Administrative Agent; Barclays Capital, the
investment banking division of Barclays Bank PLC, as Joint Lead
Arranger and Documentation Agent; and Bank of America, N.A., as
Issuing Bank.
As reported in the Troubled Company Reporter on Feb. 5, 2008,
the Revolver Amendment amended the terms of the existing
Revolving DIP Credit Agreement to, among other things,
(i) extend its final maturity date from Jan. 31, 2008 to
June 30, 2008;
(ii) reduce the commitment from US$115,000,000 to
US$90,000,000;
(iii) delete the minimum EBITDA covenant and amend the budget
compliance covenant to provide for a 25% cushion during
the months of February and March and a 20% cushion
thereafter, in each case with respect to the amount
budgeted for revolver borrowings during the time;
(iv) permit the Debtors to retain certain asset sale
proceeds;
(v) amend the Revolving DIP Credit Agreement to include
certain representations, warranties and covenants
contained in the New Term Loan DIP Agreement;
(vi) include a covenant requiring the Debtors to meet certain
milestones in their restructuring plan;
(vii) amend the excess availability covenant to increase the
minimum excess availability requirement to US$25,000,000
subject to subsequent decreases to US$20,000,000 and
US$15,000,000 upon compliance with certain conditions
set forth in the Revolver Amendment; and
(viii) increase the interest rate set forth in the Revolving
DIP Credit Agreement by 0.50%; provided that LIBOR Rate
will not be available to the Debtors during the
remaining term of the Revolving DIP Credit Agreement.
In light of the Debtors' entry into the US$170,000,000
replacement facility, which was earlier given final approval by
the Court, the Debtors have repaid the outstanding amounts under
their Senior Secured Super-Priority Debtor In Possession Term
Loan and Guaranty Agreement, dated as of October 31, 2006, with
a syndicate of lenders led by Goldman Sachs Credit Partners
L.P., as administrative agent. The Court said that the Existing
Term DIP Facility is now terminated with the payment of the
Debtors' obligations in full in cash.
Rochester Hills, Mich.-based DURA Automotive Systems Inc.
(Nasdaq: DRRA) -- http://www.DURAauto.com/-- is an independent
designer and manufacturer of driver control systems, seating
control systems, glass systems, engineered assemblies,
structural door modules and exterior trim systems for the global
automotive industry. The company is also a supplier of similar
products to the recreation vehicle and specialty vehicle
industries. DURA sells its automotive products to North
American, Japanese and European original equipment manufacturers
and other automotive suppliers.
The company has three locations in Asia -- China, Japan and
Korea. It has locations in Europe and Latin-America,
particularly in Mexico, Germany and the United Kingdom.
The Debtors filed for chapter 11 petition on Oct. 30, 2006
(Bankr. D. Del. Case No. 06-11202). Richard M. Cieri, Esq.,
Marc Kieselstein, Esq., Roger James Higgins, Esq., and Ryan
Blaine Bennett, Esq., of Kirkland & Ellis LLP are lead counsel
for the Debtors' bankruptcy proceedings. Mark D. Collins, Esq.,
Daniel J. DeFranseschi, Esq., and Jason M. Madron, Esq., of
Richards Layton & Finger, P.A. Attorneys are the Debtors' co-
counsel. Baker & McKenzie acts as the Debtors' special counsel.
Togut, Segal & Segal LLP is the Debtors' conflicts counsel.
Miller Buckfire & Co., LLC is the Debtors' investment banker.
Glass & Associates Inc., gives financial advice to the Debtor.
Kurtzman Carson Consultants LLC handles the notice, claims and
balloting for the Debtors and Brunswick Group LLC acts as their
Corporate Communications Consultants for the Debtors.
As of July 2, 2006, the Debtor had US$1,993,178,000 in total
assets and US$1,730,758,000 in total liabilities. The Debtors
have asked the Court to extend their plan filing period to
April 30, 2008.
(Dura Automotive Bankruptcy News, Issue No. 46; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000)
DURA AUTOMOTIVE: Must Appear at Final Hearing to OK Bonus Plan
--------------------------------------------------------------
The Hon. Kevin J. Carey agreed to approve a 2008 Bonus Plan
after forcing DURA Automotive Systems Inc. and its debtor-
affiliates to agree to come back for a final hearing before the
Debtors pay key managers, should the company still be in
bankruptcy in July 2008, Steven Church at Bloomberg News
reported.
According to Bloomberg, Judge Carey said the goal of a final
hearing would be to find out whether a delay in the Debtors'
plan to exit Chapter 11 in June 2008 is "attributable to the
employees' performance."
"I want to get to the heart of why the case is not out by then,"
Bloomberg quoted Judge Carey as saying.
Bloomberg also reported that Judge Carey rejected an objection
of the United Automotive Workers union to the Bonus Plan ruling
that performance targets were reasonable.
2008 Annual Bonus Plan Filed
The Debtors had asked the Court to approve the 2008 Bonus Plan.
To address the concerns raised by the Official Committee of
Unsecured Creditors, the Debtors entered into discussions with
the Creditors Committee and, based on those discussions,
produced
a modified 2008 annual bonus plan for certain key management and
other employees.
The 2008 Annual Bonus Plan provides incentive bonus program for
about 110 non-senior management and other key employees whom the
Debtors employ in their North American operations. The 2008 ABP
does not include bonus payments to the Debtors' chief executive
officer, chief financial officer, chief operating officer, or
the
chief administrative officer. None of those officials will
receive any payment under the 2008 ABP.
The 2008 Bonus Plan will make available US$2,600,000, allocated
as:
-- US$1,680,000 if targets are met in timely completion of
certain operational restructuring initiatives related to
the "Metals Move;" and
-- US$920,000 if the Debtors achieve its projected EBITDA
targets.
The Operational Restructuring Incentive Bonuses are designed to
provide incentives for on-time, below budget execution of the
production relocations from the Jacksonville, Florida; Moberly,
Missouri; and Gladwin, Michigan, plants to Matamoros, Mexico. A
bonus payment of US$700,000 will be awarded if the Jacksonville
Donor Plant production relocation is completed on or before
June 30, 2008. The US$700,000 Bonus Payment will not be awarded
if the relocation is not completed before June 30.
Each 2008 Bonus Plan Participant's EBITDA Incentive Bonus
payment will vary proportionally from 50% of the target amount
if 90% of the participant's target is met to 150% of the target
if 120% of the participant's target is achieved. No EBITDA
Incentive Bonus will be awarded if actual achievement is less
than 90% of the target EBITDA.
The Debtors will make the bonus payments as soon as practicable
after their emergence from Chapter 11, provided that emergence
will not be later than July 11, 2008, and further payments on
Oct. 31, 2008, and Jan. 31, 2009.
Daniel J. DeFranceschi, Esq., at Richards, Layton & Finger,
P.A., in Wilmington, Delaware, tells the Court that the 2008
Annual Bonus Plan is very similar in scope and intent to the
Debtors' historic annual bonus plans, albeit certain frontloaded
payments.
The International Union, United Automobile, Aerospace and
Agricultural Implement Workers of America, has objected to the
Debtors' proposed 2008 key management incentive plan and asked
the Court to deny approval of that incentive plan.
The UAW asserted that:
(a) the proposed 2008 KMIP operates quite differently from
the Debtors' prepetition Annual Bonus Plan;
(b) the proposed 2008 KMIP was prepared by senior management,
including executives who sought to be covered under the
program;
(c) there is nothing in the 2008 KMIP that connects the
payment of a bonus to any individualized or team
performance goals; and
(d) the Debtors are proposing the 2008 KMIP not because due
diligence has revealed any specific need for a program
but because the Debtors' exit from bankruptcy has been
delayed and they do not want unhappy and disappointed
managers.
The Debtors, in response to UAW's objections, noted that the
2008 Annual Bonus Plan was developed, not only with the input of
a multitude of compensation consultants, but also with an
independent counsel as well as input of the Creditors Committee.
The Creditors Committee withdrew its objection to the proposed
2008 KMIP as a result of the creation of the 2008 Bonus Plan.
Rochester Hills, Mich.-based DURA Automotive Systems Inc.
(Nasdaq: DRRA) -- http://www.DURAauto.com/-- is an independent
designer and manufacturer of driver control systems, seating
control systems, glass systems, engineered assemblies,
structural door modules and exterior trim systems for the global
automotive industry. The company is also a supplier of similar
products to the recreation vehicle and specialty vehicle
industries. DURA sells its automotive products to North
American, Japanese and European original equipment manufacturers
and other automotive suppliers.
The company has three locations in Asia -- China, Japan and
Korea. It has locations in Europe and Latin-America,
particularly in Mexico, Germany and the United Kingdom.
The Debtors filed for chapter 11 petition on Oct. 30, 2006
(Bankr. D. Del. Case No. 06-11202). Richard M. Cieri, Esq.,
Marc Kieselstein, Esq., Roger James Higgins, Esq., and Ryan
Blaine Bennett, Esq., of Kirkland & Ellis LLP are lead counsel
for the Debtors' bankruptcy proceedings. Mark D. Collins, Esq.,
Daniel J. DeFranseschi, Esq., and Jason M. Madron, Esq., of
Richards Layton & Finger, P.A. Attorneys are the Debtors' co-
counsel. Baker & McKenzie acts as the Debtors' special counsel.
Togut, Segal & Segal LLP is the Debtors' conflicts counsel.
Miller Buckfire & Co., LLC is the Debtors' investment banker.
Glass & Associates Inc., gives financial advice to the Debtor.
Kurtzman Carson Consultants LLC handles the notice, claims and
balloting for the Debtors and Brunswick Group LLC acts as their
Corporate Communications Consultants for the Debtors.
As of July 2, 2006, the Debtor had US$1,993,178,000 in total
assets and US$1,730,758,000 in total liabilities. The Debtors
have asked the Court to extend their plan filing period to
April 30, 2008.
(Dura Automotive Bankruptcy News, Issue No. 46; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000)
EPICOR SOFTWARE: Borrows US$160 Mil. to Finance NSB Acquisition
---------------------------------------------------------------
On Feb. 19, 2008, Epicor Software Corp. borrowed US$160.0
million under the company's Credit Agreement dated Dec. 16,
2007, as arranged by Banc of America Securities LLC. Epicor
used the proceeds to finance the acquisition of NSB Retail
Systems PLC and to pay certain fees and expenses incurred in
connection with the NSB Acquisition.
As reported in the Troubled Company Reporter on Dec. 21, 2007,
The boards of directors of Epicor Software Corporation and NSB
Retail Systems PLC reached an agreement on the terms of the
recommended acquisition of NSB by Epicor pursuant to a scheme of
arrangement under section 425 of the United Kingdom Companies
Act 1985 whereby shareholders of NSB will receive 38 pence in
cash per NSB ordinary share.
The terms of the transaction value the fully diluted share
capital of NSB at approximately US$322 million, based on the
US$:GBP exchange rate on Dec. 14, 2007.
About Epicor Software
Headquartered in Irvine, California, Epicor Software Corporation
(Nasdaq: EPIC) -- http://www.epicor.com/-- provides integrated
enterprise resource planning, customer relationship management,
supply chain management and professional services automation
software solutions to the midmarket and divisions of the Global
1000 companies. Founded in 1984, Epicor serves over 20,000
customers in more than 140 countries, providing solutions in
over 30 languages. Epicor offers a comprehensive range of
services with its solutions, providing a single point of
accountability to promote rapid return on investment and low
total cost of ownership.
Epicor Software has worldwide locations in China,
Australia, Canada, Germany, Hong Kong, Indonesia, Italy, Japan,
Korea, Malaysia, Mexico, Singapore, Taiwan, and the United
Kingdom, among others.
* * *
As reported in the Troubled Company Reporter on Dec. 21, 2007,
Standard & Poor's Ratings Services affirmed its 'BB-' corporate
credit rating and revised its outlook on Epicor Software Corp.
to negative from stable.
FOAMEX INTERNATIONAL: Expects Unit to Comply With Covenants
-----------------------------------------------------------
Foamex International Inc. expects Foamex L.P., the company's
primary operating subsidiary, to achieve the requisite level of
Consolidated EBITDA for 2007, as defined in Foamex L.P.'s credit
agreements, to be in compliance with its financial covenants as
of year-end.
Under Foamex L.P.'s credit agreements, the minimum amount of
Consolidated EBITDA for compliance with its financial covenants
as of the end of the fourth quarter of 2007 is approximately
US$97 million.
The company also significantly exceeded its targets for debt
reduction in 2007. The company anticipated that its net debt
would be under US$560 million by the end of 2007. Net debt as
of Dec. 30, 2007, was approximately US$529 million and gross
debt was approximately US$534 million.
"I'm pleased with the company's strong ability to generate cash
to reduce debt," Bob Larney, executive vice president and chief
financial officer of Foamex, said.
In addition, the company has received commitments for up to
US$20 million of additional investment from D.E. Shaw Laminar
Portfolios L.L.C., Goldman Sachs & Co. and Sigma Capital
Management LLC. The company believes these commitments will
assist in its compliance with financial covenants under its
credit agreements during the entire 2008 year.
"With these commitments, our major shareholders have shown that
they are very supportive of the company, and now management can
spend more time and effort on our operational and strategic
growth plans." Jack Johnson, president and chief executive
officer of Foamex, said.
About Foamex International Inc.
Headquartered in Linwood, Pennsylvania, Foamex International
Inc. (FMXIQ.PK) -- http://www.foamex.com/-- produces cushioning
for bedding, furniture, carpet cushion and automotive markets.
The company also manufactures polymers for the industrial,
aerospace, defense, electronics and computer industries. Foamex
has Asian locations in Malaysia, Thailand and China. The
company's Latin American subsidiary is in Mexico.
The company and eight affiliates filed for chapter 11 protection
on Sept. 19, 2005 (Bankr. Del. Case Nos. 05-12685 through 05-
12693). Attorneys at Paul, Weiss, Rifkind, Wharton & Garrison
LLP, represent the Debtors in their restructuring efforts.
Houlihan, Lokey, Howard and Zukin and O'Melveny & Myers LLP are
advising the ad hoc committee of Senior Secured Noteholders.
Kenneth A. Rosen, Esq., and Sharon L. Levine, Esq., at
Lowenstein Sandler PC and Donald J. Detweiler, Esq., at Saul
Ewings, LP, represent the Official Committee of Unsecured
Creditors. As of July 3, 2005, the Debtors reported
US$620,826,000 in total assets and US$744,757,000 in total
debts.
On Feb. 2, 2007, the Court confirmed the Debtors' Second Amended
Joint Plan of Reorganization. The Plan of Reorganization of
Foamex International Inc. became effective and the company
emerged from chapter 11 bankruptcy protection on Feb. 12, 2007.
At July 1, 2007, Foamex International Inc.'s balance sheet
showed total assets of US$566.2 million and total liabilities of
US$823.5 million, resulting to a total stockholders' deficit of
US$257.3 million.
ODYSSEY RE: Hires Brian Young as CEO for London Market Division
---------------------------------------------------------------
Odyssey Re Holdings Corp. has named Brian Young as its chief
executive officer for Global Insurance and London Market
Operations effective April 1, 2008. Mr. Young presently manages
Odyssey Re's London Market Division. In his new position, Mr.
Young will have overall responsibility for Odyssey Re's U.S.
Insurance and London Market Divisions.
The present management structure of Odyssey Re's U.S. Insurance
Division will remain in place, with Jim Migliorini, chief
executive officer - U.S. Insurance, reporting to Mr. Young.
Through its Hudson Insurance Group, the Division provides
underwriting capacity on an admitted and non-admitted basis to
medical malpractice and specialty insurance markets nationwide.
Mr. Young will be relocating from London to New York in
connection with his new responsibilities. Carl Overy will
assume local senior management responsibility in London as
Odyssey Re's new Chief Executive Officer - London Market
Division, and report to Mr. Young. Mr. Overy is currently the
Chief Actuary of the London Market Division, and has been a
member of Odyssey Re's management team in London for the past
six years. The Division underwrites casualty insurance and
treaty reinsurance on a worldwide basis through Odyssey Re's
London branch, Newline Insurance Company Limited and Newline
Syndicate 1218 at Lloyd's.
In announcing this new management position, Andrew A. Barnard,
Odyssey Re's chief executive officer, commented: "Unifying the
reporting structure of our London and U.S. platforms is an
important step in optimizing the development of Odyssey Re's
insurance activities on a global basis. Brian's proven
management skills, and the variety and depth of his industry
experience, make him well-suited for this important new
position."
Odyssey Re Holdings Corp. (NYSE: ORH) is an underwriter of
property and casualty treaty and facultative reinsurance, as
well as specialty insurance. Odyssey Re operates through its
subsidiaries, Odyssey America Reinsurance Corp., Hudson
Insurance Co., Hudson Specialty Insurance Co. Clearwater
Insurance Co., Newline Underwriting Management Limited and
Newline Insurance Co. Ltd. The Company underwrites through
offices in the United States, London, Paris, Singapore, Toronto
and Mexico City. Odyssey Re Holdings Corp. is listed on the New
York Stock Exchange under the symbol ORH.
* * *
To date, Odyssey Re Holdings Corp. carries Standard & Poor's
'BB' preferred stock ratings.
WEST CORP: Plans to Purchase Genesys for US$269 Million
-------------------------------------------------------
West Corporation will seek to acquire Genesys and combine it
with InterCall Inc., its subsidiary. West will make a cash
offer of EUR2.50 per ordinary share and for the American
Depositary Shares at the U.S. dollar equivalent. The total
transaction value, excluding transaction expenses, is
approximately EUR182.9 million or approximately US$268.8
million.
For that purpose, West International Holdings Limited, a
subsidiary of West, filed with the French Autorite des Marches
Financiers a draft Tender Offer Prospectus. Genesys' board of
directors has unanimously expressed support for this project and
authorized the execution of a tender offer agreement between the
two companies.
Genesys' board of directors intends to recommend the offer to
its shareholders. In accordance with French law and the tender
offer agreement, such recommendation will be published in a
draft Response Document to be filed by Genesys with the AMF
within the next 10 business days.
The tender offer price of EUR2.50 or approximately US$3.681 per
share of common stock of Genesys, represents a premium of 50%
above the closing price of Genesys' shares on Feb. 18, 2008, the
last trading day prior to this disclosure, and a premium of 42%
above the average closing price of Genesys' shares, volume-
weighted over the last three months.
The acquisition is expected to be funded with a combination of
West's cash on hand and West's bank credit facilities. West
expects to close the transaction during the second quarter.
"West is committed to expanding InterCall's presence and this
statement represents a significant step in achieving this goal,"
Thomas B. Barker, chief executive officer of West Corporation,
stated. "When completed, this transaction will strengthen our
leadership position and give our combined client base more
collaboration solutions and personal attention in more locations
than any other conferencing provider in the world."
"Genesys has developed a leading multimedia conferencing
solution for the global enterprise and is recognized by the
industry as a leader in conferencing technology," Francois
Legros, chairman and CEO of Genesys, said. "The board of
directors and I are excited to see that the innovation and hard
work of our employees and partners are validated and will now be
part of a much bigger organization."
Houlihan Lokey Howard & Zukin (Europe) Limited acted as
financial advisor to Genesys and Lehman Brothers Inc. acted as
financial advisor to West Corporation.
Ricol Lasteyrie & Associes was appointed by Genesys as
independent expert in accordance with Article 261-1 I° of the
AMF General Regulations. The independent expert's report, once
finalized, will be included in Genesys' draft Response Document.
The transaction is to take the form of a tender offer subject to
the standard procedure under applicable French laws and
regulations for all Genesys shares and bonds redeemable in
shares and all ADSs representing ordinary shares.
The offer will only be opened for acceptance once the French
regulatory authority, the AMF, has granted approval. The offer
will be subject to these conditions:
(i) Genesys securities tendered in the offer represent more
than 66.66% of all the shares, including shares
represented by ADSs, of Genesys on a fully diluted basis;
and
(ii) receipt of antitrust approvals in the United States, the
United Kingdom and Germany.
About Genesys
Founded in 1986, Genesys (Euronext Eurolist: FR0004270270) --
http://www.genesys.com/-- is a provider of converged
collaboration and communication services to thousands of
organizations, including more than 250 of the Fortune Global
500. The company's flagship product, Genesys Meeting Center,
provides an integrated multimedia conferencing solution that is
easy to use and available on demand. With offices in more than
20 countries across North America, Europe and Asia Pacific.
About West Corporation
Headquartered in Omaha, Nebraska, West Corporation --
http://www.west.com/-- is a provider of outsourced
communication solutions to many companies, organizations and
government agencies. West has a team of 42,000 employees based
in North America, Europe, and Asia. West helps its clients
communicate effectively, maximize the value of their customer
relationships and drive greater profitability from every
interaction.
The company also has operations in Australia, Canada, China,
Hong Kong, India, Jamaica, Mexico, Philippines, Singapore,
Switzerland and the United Kingdom.
InterCall Inc. -- http://www.intercall.com/-- is a subsidiary
of West Corporation, is a service provider in the world
specializing in conference communications. Founded in 1991,
InterCall helps people and companies be more productive by
providing advanced audio, event, Web and video conferencing
solutions that are easy-to-use and save them time and money.
Along with a team of over 600 Meeting Consultants, the company
employs more than 1,500 operators, customer service
representatives, call supervisors, accounting, marketing and IT
professionals. InterCall's U.S. presence, which includes four
call centers and 26 sales offices, extends to Canada, Mexico,
Latin America, the Caribbean, the United Kingdom, Ireland,
France, Germany, Australia, New Zealand, India, Hong Kong,
Singapore and Japan.
As reported in the Troubled Company Reporter on Feb. 4, 2008,
the company's Dec. 31, 2007, balance sheet for the year showed a
stockholders' deficit of US$2.2 million.
=======
P E R U
=======
QUEBECOR WORLD: Auction Prices Bonds at 41.25%
----------------------------------------------
A Credit Event Auction for Quebecor World Inc. took place on
Feb. 19, 2008, with 13 participating dealers. The auction
was run in accordance with the ISDA 2008 Quebecor CDS Protocol.
Markit Group Limited and Creditex Group Inc. acted as official
auction administrators. The Credit Event Auction mechanism is
designed to ensure orderly and operationally efficient trade
settlement for credit derivatives by determining the final cash
settlement price for defaulted Quebecor CDS contracts. During
the Quebecor Credit Event Auction, major dealers submited orders
electronically on the Creditex platform. Markit calculated and
verified the auction results.
The final price of Quebecor World's bonds is 41.25%. Karen
Brettell of Reuters reported that based on the final price, this
would mean that the amount of principal the Quebecor bonds
recover would be 41.25% of par. "Thus a buyer of protection
would be compensated 58.75% the amount of debt insured," Ms.
Brettell wrote.
The auction results are available at:
http://ResearchArchives.com/t/s?2868
The Credit Event Auction process was launched in 2005 by Markit
and Creditex in collaboration with ISDA and major credit
derivative dealers to facilitate the settlement of credit
derivative contracts in the event of a corporate default.
About Quebecor World
Based in Montreal, Quebec, Quebecor World Inc. (TSX: IQW) (NYSE:
IQW), -- http://www.quebecorworldinc.com/-- provides market
solutions, including marketing and advertising activities, well
as print solutions to retailers, branded goods companies,
catalogers and to publishers of magazines, books and other
printed media. It has 127 printing and related facilities
located in North America, Europe, Latin America and Asia. In
the United States, it has 82 facilities in 30 states, and is
engaged in the printing of books, magazines, directories, retail
inserts, catalogs and direct mail. In Canada it has 17
facilities in five provinces, through which it offers a mix of
printed products and related value-added services to the
Canadian market and internationally. The company has operations
in Mexico, Brazil, Colombia, Chile, Peru, Argentina and the
British Virgin Islands.
The company is an independent commercial printer in Europe with
19 facilities, operating in Austria, Belgium, Finland, France,
Spain, Sweden, Switzerland and the United Kingdom. In March
2007, it sold its facility in Lille, France. Quebecor World
(USA) Inc. is its wholly owned subsidiary.
Quebecor World and 53 of its subsidiaries, including those in
Canada, filed a petition under the Companies' Creditors
Arrangement Act before the Superior Court of Quebec, Commercial
Division, in Montreal, Canada, on Jan. 20, 2008. The Honorable
Justice Robert Mongeon oversees the CCAA case. Francois-David
Pare, Esq., at Ogilvy Renault, LLP, represents the Company in
the CCAA case. Ernst & Young Inc. was appointed as Monitor.
On Jan. 21, 2008, Quebecor World (USA) Inc., its U.S.
subsidiary, along with other U.S. affiliates, filed for chapter
11 bankruptcy on Jan. 21, 2008 (Bankr. S.D.N.Y Lead Case No.
08-10152). Anthony D. Boccanfuso, Esq., at Arnold & Porter LLP
represents the Debtors in their restructuring efforts. The
Official Committee of Unsecured Creditors is represented by Akin
Gump Strauss Hauer & Feld LLP.
Based in Corby, Northamptonshire, Quebecor World PLC --
http://www.quebecorworldplc.com/-- is the U.K. subsidiary of
Quebecor World Inc. that specializes in web offset magazines,
catalogues and specialty print products for marketing and
advertising campaigns. The company employs around 290 people.
Quebecor PLC was placed into administration with Ian Best and
David Duggins of Ernst & Young LLP appointed as joint
administrators effective Jan. 28, 2008.
As of Sept. 30, 2007, Quebecor World's unaudited consolidated
balance sheet showed total assets of US$5,554,900,000, total
liabilities of US$3,964,800,000, preferred shares of
US$175,900,000, and total shareholders' equity of
US$1,414,200,000.
The company has until May 20, 2008, to file a plan of
reorganization in the Chapter 11 case. The Debtors' CCAA stay
has been extended to May 12, 2008. (Quebecor World Bankruptcy
News, Issue No. 6; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
* * *
As reported in the Troubled Company Reporter-Latin America on
Feb. 13, 2008, Moody's Investors Service assigned a Ba2 rating
to the US$400 million super priority senior secured revolving
term loan facility of Quebecor World Inc. as a Debtor-in-
Possession. The related US$600 million super priority senior
secured term loan was rated Ba3 (together, the DIP facilities).
The RTL's better asset value coverage relative to the TL
accounts for the ratings'
differential.
QUEBECOR WORLD: Court Okays Payment of Prepetition Commissions
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
gave Quebecor World Inc. and its affiliates permission to pay
accrued prepetition commissions due and owing as of Feb. 1,
2008, to their sales representatives.
As reported in the Troubled Company Reporter on Feb. 19, 2008,
Michael J. Canning, Esq., at Arnold & Porter LLP, in New York,
related that the Debtors' sales representatives are located in
plants or in regional offices throughout North America, Europe
and Latin America, and customers are able to coordinate
simultaneous printing throughout the Debtors' network through a
single sales representative.
The Debtors' sales representatives are compensated primarily on
a commission basis and are paid from 30 to 90 days after a sale
actually occurred. Accordingly, the sales representatives may
go for long periods without receiving commissions, at which
point they may be entitled to several months worth of
commissions.
Mr. Canning said that the Debtors owe 59 sale representatives,
as of February 1, US$1,792,993. Of this amount, US$1,234,641
reflects amounts in excess of US$10,950 per employee, with the
proposed prepetition payments per employee ranging from US$933
to US$117,868.
The Debtors intends to provide the Office of the United States
Trustee and counsel to the Official Committee of Unsecured
Creditors a schedule showing for each employee scheduled to
receive sales commissions on Feb. 1, 2008, the amount of payment
and the amount of additional compensation previously received by
the employee on account of 2007.
About Quebecor World
Based in Montreal, Quebec, Quebecor World Inc. (TSX: IQW) (NYSE:
IQW), -- http://www.quebecorworldinc.com/-- provides market
solutions, including marketing and advertising activities, well
as print solutions to retailers, branded goods companies,
catalogers and to publishers of magazines, books and other
printed media. It has 127 printing and related facilities
located in North America, Europe, Latin America and Asia. In
the United States, it has 82 facilities in 30 states, and is
engaged in the printing of books, magazines, directories, retail
inserts, catalogs and direct mail. In Canada it has 17
facilities in five provinces, through which it offers a mix of
printed products and related value-added services to the
Canadian market and internationally. The company has operations
in Mexico, Brazil, Colombia, Chile, Peru, Argentina and the
British Virgin Islands.
The company is an independent commercial printer in Europe with
19 facilities, operating in Austria, Belgium, Finland, France,
Spain, Sweden, Switzerland and the United Kingdom. In March
2007, it sold its facility in Lille, France. Quebecor World
(USA) Inc. is its wholly owned subsidiary.
Quebecor World and 53 of its subsidiaries, including those in
Canada, filed a petition under the Companies' Creditors
Arrangement Act before the Superior Court of Quebec, Commercial
Division, in Montreal, Canada, on Jan. 20, 2008. The Honorable
Justice Robert Mongeon oversees the CCAA case. Francois-David
Pare, Esq., at Ogilvy Renault, LLP, represents the Company in
the CCAA case. Ernst & Young Inc. was appointed as Monitor.
On Jan. 21, 2008, Quebecor World (USA) Inc., its U.S.
subsidiary, along with other U.S. affiliates, filed for chapter
11 bankruptcy on Jan. 21, 2008 (Bankr. S.D.N.Y Lead Case No.
08-10152). Anthony D. Boccanfuso, Esq., at Arnold & Porter LLP
represents the Debtors in their restructuring efforts. The
Official Committee of Unsecured Creditors is represented by Akin
Gump Strauss Hauer & Feld LLP.
Based in Corby, Northamptonshire, Quebecor World PLC --
http://www.quebecorworldplc.com/-- is the U.K. subsidiary of
Quebecor World Inc. that specializes in web offset magazines,
catalogues and specialty print products for marketing and
advertising campaigns. The company employs around 290 people.
Quebecor PLC was placed into administration with Ian Best and
David Duggins of Ernst & Young LLP appointed as joint
administrators effective Jan. 28, 2008.
As of Sept. 30, 2007, Quebecor World's unaudited consolidated
balance sheet showed total assets of US$5,554,900,000, total
liabilities of US$3,964,800,000, preferred shares of
US$175,900,000, and total shareholders' equity of
US$1,414,200,000.
The company has until May 20, 2008, to file a plan of
reorganization in the Chapter 11 case. The Debtors' CCAA stay
has been extended to May 12, 2008. (Quebecor World Bankruptcy
News, Issue No. 6; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
* * *
As reported in the Troubled Company Reporter-Latin America on
Feb. 13, 2008, Moody's Investors Service assigned a Ba2 rating
to the US$400 million super priority senior secured revolving
term loan facility of Quebecor World Inc. as a Debtor-in-
Possession. The related US$600 million super priority senior
secured term loan was rated Ba3 (together, the DIP facilities).
The RTL's better asset value coverage relative to the TL
accounts for the ratings'
differential.
QUEBECOR WORLD: Various Entities Disclose Stake in Company
----------------------------------------------------------
In separate filings with the United Stated Securities and
Exchange Commission, several entities disclosed holding a stake
in Quebecor World Inc.:
1. Ronald Gutfleish
Ronald Gutfleish disclosed that he may be deemed to
beneficially own 7,552,055 subordinate voting shares issued by
Quebecor World Inc. Mr. Gutfleish is a managing member of Elm
Ridge Capital Management LLC.
2. Avenue Capital, et al.
Avenue Capital Management II LP, Avenue Capital Management II
GenPar LLC, and Marc Lasry disclosed that each of them may be
deemed to beneficially own 5,518,000 subordinate voting shares
issued by Quebecor World Inc.
On the same day, Avenue Capital, et al., filed an amendment
stating that the number of subordinate voting shares each of
them may now be deemed to beneficially own is down to 776,000
shares.
Marc Lasry is a managing member of Avenue Capital Management II
LP, and Avenue Capital Management II GenPar, LLC. Avenue
Capital Management II GenPar is the general partner of Avenue
Capital Management II LP.
3. Brandes Investment, et al.
Brandes Investment Partners LP, Brandes Investment Partners
Inc., Brandes Worldwide Holdings LP, Charles Brandes, Glenn
Carlson, and Jeffrey Busy disclosed that each of them may be
deemed to beneficially own 9,205,888 shares of Quebecor World
Inc.'s common stock.
Brandes entities' shares represent 10.82% of the 85,079,000
Quebecor World common shares outstanding as of February 1, 2008.
They disclaim any direct ownership of the 9,205,888 shares.
Brandes Investment Partners LP, is an investment adviser.
Brandes Investment Partners Inc., Brandes Worldwide Holdings LP,
Mr. Brandes, Mr. Carlson, and Mr. Busy are control persons of
the investment adviser. Mr. Brandes is also the president of
Brandes Investment Partners Inc.
4. Phillips, Hager & North Investment Management Ltd.
Phillips, Hager & North Investment Management Ltd., disclosed
that as of Dec. 31, 2007, his company was deemed to beneficially
own 105,300 shares of Quebecor World Inc.'s common stock.
Phillips Hager's shares represent 0.12% of the 85,079,000 shares
of Quebecor World's common stock outstanding as of Feb. 1, 2008.
About Quebecor World
Based in Montreal, Quebec, Quebecor World Inc. (TSX: IQW) (NYSE:
IQW), -- http://www.quebecorworldinc.com/-- provides market
solutions, including marketing and advertising activities, well
as print solutions to retailers, branded goods companies,
catalogers and to publishers of magazines, books and other
printed media. It has 127 printing and related facilities
located in North America, Europe, Latin America and Asia. In
the United States, it has 82 facilities in 30 states, and is
engaged in the printing of books, magazines, directories, retail
inserts, catalogs and direct mail. In Canada it has 17
facilities in five provinces, through which it offers a mix of
printed products and related value-added services to the
Canadian market and internationally.
The company is an independent commercial printer in Europe with
19 facilities, operating in Austria, Belgium, Finland, France,
Spain, Sweden, Switzerland and the United Kingdom. In March
2007, it sold its facility in Lille, France. Quebecor World
(USA) Inc. is its wholly owned subsidiary.
Quebecor World and 53 of its subsidiaries, including those in
Canada, filed a petition under the Companies' Creditors
Arrangement Act before the Superior Court of Quebec, Commercial
Division, in Montreal, Canada, on Jan. 20, 2008. The Honorable
Justice Robert Mongeon oversees the CCAA case. Francois-David
Pare, Esq., at Ogilvy Renault, LLP, represents the Company in
the CCAA case. Ernst & Young Inc. was appointed as Monitor.
On Jan. 21, 2008, Quebecor World (USA) Inc., its U.S.
subsidiary, along with other U.S. affiliates, filed for chapter
11 bankruptcy on Jan. 21, 2008 (Bankr. S.D.N.Y Lead Case No.
08-10152). Anthony D. Boccanfuso, Esq., at Arnold & Porter LLP
represents the Debtors in their restructuring efforts. The
Official Committee of Unsecured Creditors is represented by Akin
Gump Strauss Hauer & Feld LLP.
Based in Corby, Northamptonshire, Quebecor World PLC --
http://www.quebecorworldplc.com/-- is the U.K. subsidiary of
Quebecor World Inc. that specializes in web offset magazines,
catalogues and specialty print products for marketing and
advertising campaigns. The company employs around 290 people.
Quebecor PLC was placed into administration with Ian Best and
David Duggins of Ernst & Young LLP appointed as joint
administrators effective Jan. 28, 2008.
As of Sept. 30, 2007, Quebecor World's unaudited consolidated
balance sheet showed total assets of US$5,554,900,000, total
liabilities of US$3,964,800,000, preferred shares of
US$175,900,000, and total shareholders' equity of
US$1,414,200,000.
The company has until May 20, 2008, to file a plan of
reorganization in the Chapter 11 case. The Debtors' CCAA stay
has been extended to May 12, 2008. (Quebecor World Bankruptcy
News, Issue No. 6; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
* * *
As reported in the Troubled Company Reporter-Latin America on
Feb. 13, 2008, Moody's Investors Service assigned a Ba2 rating
to the US$400 million super priority senior secured revolving
term loan facility of Quebecor World Inc. as a Debtor-in-
Possession. The related US$600 million super priority senior
secured term loan was rated Ba3 (together, the DIP facilities).
The RTL's better asset value coverage relative to the TL
accounts for the ratings'
differential.
====================
P U E R T O R I C O
====================
AVNET INC: Moody's Lifts Corporate Family Rating to Baa3
--------------------------------------------------------
Moody's Investors Service raised the corporate family and senior
unsecured ratings of Avnet Inc. to Baa3 from Ba1 with a stable
outlook.
"The upgrade reflects our expectation that Avnet's operating
performance will continue to benefit from the secular
outsourcing trend underway in the electronics OEM space,
improved product mix, as ll as enhanced scale, increasing
geographic diversity and an expanded line card with access to
new customer relationships as a result of recent acquisitions,"
according to Moody's Vice President & Senior Analyst Gregory
Fraser, CFA.
Moody's cited the upgrade considers the solid execution,
operating efficiency improvements and working capital management
that have exceeded expectations resulting in operating margin
and ROA expansion, improved credit protection measures, higher
gross cash flow levels and an enhanced business model that has
the propensity to deliver consistent levels of positive free
cash flow especially during periods of industry akness. The
steady improvement in financial leverage, which Moody's expects
to continue, also supports the upgrade, as does Avnet's
disciplined financial philosophy with respect to maintaining
strong balance sheet liquidity and modest financial leverage.
"Barring an extended period of economic weakness, we expect
Avnet to continue to grow operating income at a faster pace than
revenues and maintain a focus on balance sheet de-leveraging via
either free cash flow generation targeted towards debt reduction
or higher levels of operating cash flow," Mr. Fraser added.
The stable ratings outlook reflects expectations for stable
financial leverage and interest coverage metrics, relatively
steady vendor/customer relationships, and maintenance of
operating margins in the 2-4% range during an economic cycle.
The rating outlook factors in Moody's expectation that debt to
book capitalization will remain below 35% and retained cash flow
to debt will remain above 25% in a downturn scenario.
Despite Avnet's end market and geographic diversification, there
is some concern that the current weak macro-economic environment
could result in a broad-based corporate IT spending slowdown,
potentially impacting Avnet's operating profitability. However,
in a reasonable downside scenario, which is incorporated in the
Baa3 rating, Moody's does not expect operating margins to fall
below 2.5% based on Avnet's enhanced scale and current operating
leverage. Additionally, given Avnet's ongoing focus on cost
controls, Moody's believes the company should be less vulnerable
during an industry retrenchment than in previous cycles.
Nonetheless, the rating could experience downward pressure to
the extent operating margins were to fall below 2.5% on a
sustained basis (two to four quarters).
The rating factors the volatility of inventory and payables
usage which can be irregular from quarter to quarter given the
working capital intensity of the business model driven by
seasonal demands. Mitigating this concern is Avnet's improved
working capital leverage and cash conversion cycle as well as
higher absolute yearly gross cash flow levels that cushion
periods of high working capital consumption.
The company maintains very good liquidity and financial
flexibility. This is driven by Avnet's US$417 million of cash,
Moody's expectations for free cash flow generation of at least
US$300 million in fiscal 2008, plus full access to a US$450
million accounts receivable securitization program (maturing
2008) and US$500 million unsecured revolver (maturing 2012).
These ratings were upgraded:
-- Corporate Family Rating to Baa3 from Ba1
-- Senior Unsecured Notes to Baa3 from Ba1
-- Senior / Subordinated Shelf Ratings to (P)Baa3 / (P)Ba1
from (P)Ba1 / (P)Ba2
Concurrently, Moody's has withdrawn these ratings and expects to
withdraw the corporate family rating shortly as well, as these
measures are applicable only for below investment grade
companies:
-- Probability of Default Rating
-- All LGD Assessments
Headquartered in Phoenix, Arizona, Avnet, Inc. --
http://www.avnet.com/-- distributes electronic components and
computer products, primarily for industrial customers. It has
operations in the following countries: Australia, Belgium,
China, Germany, Hong Kong, India, Indonesia, Italy, Japan,
Malaysia, New Zealand, Philippines, Singapore, and Sweden,
Brazil, Mexico and Puerto Rico. Revenues and EBITDA for the
twelve months ended Dec. 29, 2007 were US$17.0 billion and
US$873 million, respectively.
COOPER COMPANIES: Appoints John Weber as CooperVision President
---------------------------------------------------------------
The Cooper Companies Inc. has hired John A. Weber as its
president of CooperVision. Mr. Weber previously served as
president for Asia Pacific since April 2007 and vice president
for worldwide manufacturing and distribution of CooperVision
from January 2005 to March 2007. Before that, he served in
several senior executive positions at Ocular Sciences, Inc.
including executive vice president, worldwide operations.
Commenting on the appointment, Robert S. Weiss, Cooper's chief
executive officer, said, "John brings extensive worldwide
operational experience to his new role. With his background and
experience within CooperVision, he is ideally suited to continue
driving our success."
With corporate offices in Lake Forest and Pleasanton,
California, The Cooper Companies, Inc. --
http://www.coopercos.com/-- (NYSE:COO) manufactures and markets
specialty healthcare products through its CooperVision and
CooperSurgical units.
CooperVision -- http://www.coopervision.com/-- manufactures and
markets contact lenses and ophthalmic surgery products.
Headquartered in Lake Forest, Calif., it has manufacturing
operations in Albuquerque, New Mexico, Juana Diaz, Puerto Rico,
Norfolk, Virginia, Rochester, New York, Adelaide, Australia,
Hamble and Hampshire England, Ligny-en-Barrios, France, Madrid,
Spain and Toronto.
CooperSurgical -- http://www.coopersurgical.com/-- manufactures
and markets diagnostic products, surgical instruments and
accessories to the women's healthcare market. With headquarters
and manufacturing facilities in Trumbull, Conn., it also
manufactures in Pasadena, Calif., North Normandy, Illinois, Fort
Atkinson, Wisconsin, Montreal and Berlin.
Proclear(R) and Biomedics(R) are registered trademarks and
Biomedics XC(TM) and Biofinity(TM) are trademarks of The Cooper
Companies, Inc., and its subsidiaries or affiliates.
* * *
As reported in the Troubled Company Reporter-Latin America on
Oct. 18, 2007, Moody's Investors Service revised Cooper
Companies Inc.'s ratings outlook to negative from stable.
Additionally, Moody's downgraded the company's speculative grade
liquidity rating to SGL-2 from SGL-1. Concurrently, Moody's
affirmed the company's Ba3 corporate family rating, Ba3
probability of default rating and Ba3 rating on the $350 million
senior unsecured notes due 2015.
FOOT LOCKER: Allowable Dividend Payments Increased to US$95 Mil.
----------------------------------------------------------------
On Feb. 19, 2008, Foot Locker Inc. entered into an amendment of
its Fifth Amended and Restated Credit Agreement dated as of
April 9, 1997, and amended and restated as of May 19, 2004, to
increase the amount permitted to be paid by the company as
dividends during the 2008 fiscal year ending Jan. 31, 2009, from
US$90.0 million to US$95.0 million.
A full-text copy of the Amendment is available for free at:
http://researcharchives.com/t/s?2869
Headquartered in New York, Foot Locker, Inc. (NYSE: FL) ---
http://www.footlocker-inc.com/ -- is a specialty athletic
retailer that operates approximately 3,800 stores in 21
countries in North America, Canada, Puerto Rico, Europe and
Australia.
* * *
In October 2007, Standard & Poor's Ratings Services lowered its
corporate credit and senior unsecured ratings on Foot Locker
Inc. to 'BB' from 'BB+'. S&P have removed the ratings from
CreditWatch, where they were placed with negative implications
on Aug. 18, 2006. The outlook is negative.
MYLAN INC: Taps E. Leeds as VP & Global Investor Relations Head
---------------------------------------------------------------
Mylan Inc. has appointed Eric M. Leeds as senior vice president
and head of Global Investor Relations. Mr. Leeds brings to the
company more than 20 years of capital markets experience. He
most recently served as senior vice president and head of
investor relations of NYSE-listed Primedia Inc., a Kohlberg
Kravis Roberts leveraged build up of 166 media acquisitions.
While at Primedia, Mr. Leeds broadened and deepened investor
awareness, interest and support through constant change,
including 18 acquisitions, the sale or shut-down of 25
businesses and refinancings of term loans, indentures and
preferred stock.
Before joining Primedia, Mr. Leeds was executive director of
investor relations consultancy G. A. Kraut Company Inc., where
he was head of investor relations simultaneously for three
public companies majority held by John W. Kluge: Metromedia
International Group, Metromedia Fiber Network and Big City
Radio. Mr. Leeds was investor relations counsel to companies in
all industries and geographies, including Accor, Boeing, British
Telecom, Georgia-Pacific, Honeywell, Primedia, Lockheed Martin,
Monsanto, Schlumberger, Sprint and Wachovia.
Mr. Leeds began his career in 1986 as a securities analyst at
Lehman Brothers, working for an original member of the Buffett
Partnership (now Berkshire Hathaway). He then served as an
institutional investor at Chemical Bank Asset Management and
Republic Bank Asset Management, where he was a member of their
investment committee.
Mylan Vice Chairperson and Chief Executive Officer, Robert J.
Coury said: "As a significantly larger, global company, we
recognize the importance of best-in-class communications and
transparency and are pleased that Eric has joined our executive
team to further strengthen our communications with the
investment community. Eric's strong financial background,
combined with his international experience, knowledge of M&A and
leverage, and in-depth understanding of the investment community
will be invaluable in helping Mylan continue to grow its
businesses and leadership positions around the world."
Mr. Leeds said: "I am honored to join Mylan at a time when the
company is developing and evolving so dramatically. This is a
great opportunity for me to work with an extraordinary global
management team that has demonstrated its ability to execute on
its vision. I look forward to helping ensure that Mylan's
investor program appropriately reflects its position as one of
the leading quality generic pharmaceutical companies in the
world."
Mr. Leeds earned a bachelor's of science in finance from New
York University's Stern School of Business with additional
education at the New York Institute of Finance and the American
Management Association. He served on Standard & Poor's
Institutional Market Services Advisory Council and was a
founding board member of Institutional Investor Magazine's
Journal of Strategic Investor Relations.
About Mylan Inc.
Mylan Inc., formerly known as Mylan Laboratories Inc. (NYSE:
MYL), -- http://www.mylan.com/-- is a global pharmaceutical
company with market leading positions in generic
pharmaceuticals, transdermal technology and unit dose packaged
products. Mylan operates through three principal subsidiaries:
Mylan Pharmaceuticals, a world leader in generic
pharmaceuticals; Mylan Technologies, the largest producer of
generic and branded transdermal patches for the U.S. market; and
UDL Laboratories, the top U.S.-supplier of unit dose
pharmaceuticals.
Mylan also owns a controlling interest in Matrix Laboratories,
one of the world's premier suppliers of active pharmaceutical
ingredients. Mylan also has a European platform through
Docpharma, a Matrix subsidiary, which is a marketer of branded
generics in Europe. The company also has a production facility
in Puerto Rico.
* * *
As reported in the Troubled Company Reporter-Latin America on
Nov. 19, 2007, Moody's Investors Service assigned B1 ratings to
the new senior secured credit facilities of Mylan Inc. In
addition, Moody's lowered Mylan's Corporate Family Rating to B1
from Ba1, concluding a rating review for possible downgrade
initiated on May 14, 2007 and lowered the speculative grade
liquidity rating to SGL-2 from SGL-1.
SUNCOM WIRELESS: Concludes Sale to T-Mobile
-------------------------------------------
US mobile operator T-Mobile said that it has completed the
acquisition of SunCom Wireless.
Business News Americas relates that T-Mobile and SunCom Wireless
disclosed their merger agreement in September 2007. They
secured authorization from the US telecoms regulator Federal
Communications Commission on Feb. 8, 2008.
BNamericas notes that with the acquisition, T-Mobile will expand
its network coverage to 259 million from 244 million. SunCom
Wireless has 1.1 million clients in North Carolina, South
Carolina, Tennessee, Georgia, Puerto Rico and the US Virgin
Islands.
T-Mobile Chief Executive Officer Robert Dotson said that the
firm would make further improvements to the SunCom Wireless
network in Puerto Rico. It would make the transition for
customers as smooth as possible. "Customers will not need to
change their phone number or migrate to new phones or new
technology to use their current service," Mr. Dotson commented
to BNamericas.
About T-Mobile USA
T-Mobile USA is a subsidiary of Germany-based Deutsche Telekom's
T-Mobile International business. It provides wireless voice and
data communications services to subscribers in the US. Its
approximately 27 million customers use its GSM (global system
for mobile communications) network in the US and are also able
to connect the GSM network of its parent company when in Europe.
The company also provides wireless Internet (Wi-Fi) service
through its T-Mobile HotSpot brand. T-Mobile USA resells
phones, PDA's, and accessories from Motorola, Nokia, and Samsung
among other manfacturers.
About SunCom Wireless
Based in Berwyn, Pennsylvania, SunCom Wireless Holdings Inc.
(NYSE:TPC) -- http://www.suncom.com/-- provides digital
wireless communications services in the southeastern United
States, Puerto Rico and the United States Virgin Islands. The
company operates a wireless communications network covering
approximately 4.1 million potential customers in Puerto Rico and
the United States Virgin Islands. The Company provides wireless
communications services under the SunCom Wireless brand name.
* * *
Standard & Poor's placed Suncom Wireless Holdings Inc.'s long-
term foreign and local issuer credit ratings at 'B-' in
September 2007. The ratings still hold to date.
=================
V E N E Z U E L A
=================
PETROLEOS DE VENEZUELA: Receivables Under Pacts Up US$310 Mil.
--------------------------------------------------------------
El Universal reports that Petroleos de Venezuela SA's long-term
receivables, based on the published interim balance sheet, have
increased to US$310 million in six months.
According to the report, PDVSA has supplied oil to Cuba and
Argentina under the agreements, which are Venezuela's two
integral cooperation deals, with certain financial terms. In
addition, Bolivia, Uruguay, and Paraguay have been supplied with
oil under Caracas Energy Agreement. PDVSA, since 2005,
committed a comprehensive pact for hydrocarbons deliveries to 15
countries in the Caribbean and Central America including
Nicaragua, under Petrocaribe.
Under the terms governing such agreements, except for Argentina,
includes funding of the oil bill with a one-year or two-year
grace period, while annual interest rates not greater than 2
percent, and the term for repayment ranged from 15 to 25 years,
the report adds.
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.
PDVSA is one of the top exporters of oil to the US with proven
reserves of 77.2 billion barrels of oil -- the most outside the
Middle East -- and about 150 trillion cu. ft. of natural gas.
PDVSA's exploration and production take place in Venezuela, but
the company also has refining and marketing operations in the
Caribbean, Europe, and the US.
* * *
To date, Petroleos de Venezuela SA carries Fitch's BB- long term
issuer default rating and local currency long term issuer
default rating. Fitch said the ratings outlook was negative.
PETROLEOS DE VENEZUELA: Offers to Withdraw Stake in Chalmette
-------------------------------------------------------------
Venezuelan Deputy Oil Minister Bernard Mommer told reporters
that the country has offered to withdraw Petroleos de Venezuela
SA's stake in the Chalmette refinery to resolve its
nationalization dispute with Exxon Mobil.
Analysts suggested that Venezuela could offer Exxon Mobil its
50% stake in Chalmette, Business News Americas relates.
As reported in the Troubled Company Reporter-Latin America on
Feb. 22, 2008, Petroleos de Venezuela SA's head Rafael Ramirez
said that the company could sell its 50% stake in the Chalmette
plant. Petroleos de Venezuela operates the Chalmette plant with
Exxon Mobil. The plant was not affected when Petroleos de
Venezuela decided to stop making oil sales to Exxon Mobil.
Surrendering Chalmette had been "on the table" when the
Venezuelan government took over Cerro Negro, BNamericas notes,
citing Mr. Mommer.
Mr. Mommer commented to El Universal, "With Exxon the solution
was obvious from the beginning: if we position ourselves in the
area of production, we withdraw our position in refining and
those two amounts are similar."
Venezuela's demand that future contracts not contain
international arbitration clauses caused the conflict with Exxon
Mobil, BNamericas says, citing Mr. Mommer.
Experts told Prensa Latina that actions taken by Exxon Mobil
against Petroleos de Venezuela to freeze the Venezuelan firm's
assets abroad lack legal foundations. Experts also noted to
Prensa Latina that the International Center for Settlement of
Investment Disputes "has not ruled that assets must be frozen as
a previous step to arbitration."
Mr. Mommer told El Universal that Petroleos de Venezuela's
partnership accord with Exxon Mobil for Cerro Negro "provides
for the possibility to resort to two separate international
arbitration bodies." The agreement also "admits a third
arbitration body."
"It was an overambitious clause. In the event that arbitration
was dismissed, Pdvsa [Petroleos de Venezuela] undertook to
resort to another court. In other words, arbitration will come
for sure. However, I believe it is hard that the new Pdvsa
cooperates with Exxon to find a third court," Mr. Mommer
commented to El Universal.
Ecuadorian Oil and Mining Minister Galo Chiriboga told Dow Jones
Newswires that the Ecuadorian government will ask the
Organization of the Petroleum Exporting Countries to create a
group of lawyers to support Venezuela in its legal dispute
against Exxon Mobil. Ecuador also has offered Venezuela a team
of Ecuadorian attorneys. Minister Chiriboga commented to Dow
Jones, "On March 4, in a seminar before the official meeting,
I'll propose to the cartel to name a special commission of
lawyers to support Venezuela."
Venezuela has received support from a conglomerate of Arab and
Latin American nations in its conflict with Exxon Mobil, Kerry
Laird at Rigzone reports, citing Venezuela's President Hugo
Chavez. According to Rigzone, President Chavez thanked in a
television program the Arab and Latin American foreign ministers
that met in Buenos Aires. Arab League Secretary General Amir
Moussa told Rigzone that the consortium represented "an enormous
market with great possibilities."
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.
PDVSA is one of the top exporters of oil to the US with proven
reserves of 77.2 billion barrels of oil -- the most outside the
Middle East -- and about 150 trillion cu. ft. of natural gas.
PDVSA's exploration and production take place in Venezuela, but
the company also has refining and marketing operations in the
Caribbean, Europe, and the U.S.
* * *
To date, Petroleos de Venezuela SA carries Fitch's BB- long term
issuer default rating and local currency long term issuer
default rating. Fitch said the ratings outlook was negative.
==========================
V I R G I N I S L A N D S
==========================
INNOVATIVE COMM: To Auction Innovative Telephone This Year
----------------------------------------------------------
Innovative Communication Corp.'s US Virgin Islands unit
Innovative Telephone, fka Vitelco, will be placed on the auction
block this year, the Virgin Islands Daily News reports, citing
court-appointed trustee Stan Springel.
According to Business News Americas, Mr. Springel is supervising
the bankruptcy process of Innovative Communication. Mr.
Springel told Virgin Islands Daily that Innovative Telephone has
made significant progress improving its financial position and
operations. However, Innovative Telephone faced serious
liquidity issues like outstanding payments to critical vendors
in November 2007. The trustee admitted to BNamericas that the
issues haven't been completely dealt with.
Long outstanding payments to vendors are now up to date; future
capital investments are being planned; and recruitment and
training programs are being developed, BNamericas says, citing
Innovative Telephone's Interim President and Chief Executive
Officer E. Clarke Garnett.
Mr. Springel told BNamericas that his role is to prepare the
Innovative Communication units for auction later this year.
Virgin Islands Daily relates that Innovative Communication's
units would most likely be sold in three groups:
* Vitelco, Vitelcom Cellular, Innovative Long
Distance, Innovative Business Systems, VI Power Net,
St Croix Cable TV, Caribbean Teleview Services, BVI
Cable TV, Caribbean Communications Corp, TV2, SMB
Boatphone Holdings, Mobarton Investment, Eastern
Caribbean Cellular and St Martin Mobiles;
* Minion Corp, Valvision Telecommunications,
Valvision, World Satellite Guadeloupe, HM Beuk
Beleggingen, Alta and Martinique TV Cable; and
* Daily News Publishing, which publishes The Virgin
Islands Daily News.
Based in Christiansted, St. Croix, U.S. Virgin Islands,
Innovative Communication Corporation is telecommunications and
media company with extensive holdings throughout the Caribbean
basin. The company's operations are in Belize, British Virgin
Islands, Guadeloupe, Martinique, Saint-Martin, Sint Maarten,
U.S. Virgin Islands and France and include local, long distance
and cellular telephone companies, Internet access providers,
cable television companies, business systems, and The Virgin
Islands Daily News, a Pulitzer Prize-winning newspaper.
On Feb. 10, 2006, creditors Greenlight Capital Qualified, L.P.,
Greenlight Capital, L.P., and Greenlight Capital Offshore, Ltd.,
filed involuntary chapter 11 petition against Innovative
Communication Company LLC and Emerging Communications, Inc., and
Jeffrey J. Prosser, the company's principal (Bankr. D. Del. Case
Nos. 06-10133 through 06-10135). The Greenlight creditors
disclosed US$18,780,614 in total claims.
On July 31, 2006, Innovative LLC, Emerging, and Mr. Prosser,
filed voluntary chapter 11 petitions (Bankr. D. V.I. Case Nos.
06-30007 through 06-30009). Pursuant to Rule 1003-1 of the
Local Bankruptcy Rules of the District Court of the Virgin
Islands, Bankruptcy Division, Mr. Prosser, and Bobby Lubana,
were designated as the individuals who are the principal
operating officers of the alleged debtor. On Dec. 14, 2006, the
Delaware Bankruptcy Court entered an order transferring the
venue of the involuntary bankruptcy cases transferring to the
U.S. District Court for the District of the Virgin Islands,
Bankruptcy Division.
On July 5, 2007, the Greenlight creditors filed an involuntary
chapter 11 petition against Innovative Communication Corporation
(Bankr. D. V.I. Case No. 07-30012). The creditors disclosed
total aggregate claims of US$56,341,843. Matthew J. Duensing,
Esq., and Richard H. Dollison, Esq., at Stryker, Duensing,
Casner & Dollison, and Matthew P. Ward, Esq., at Skadden Arps
Slate Meagher & Flom LLP, represent the creditors.
Stan Springel of Alvarez & Marsal, the Court-appointed chapter
11 trustee, is represented by Andrew Kamensky, Esq., Hunton &
Williams.
***********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter - Latin America is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Fairless
Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick,
Maryland USA. Marie Therese V. Profetana, Sheryl Joy P. Olano,
Rizande delos Santos, and Pamella Ritah K. Jala, Editors.
Copyright 2008. All rights reserved. ISSN 1529-2746.
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