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 Friday, March 7, 2008, Vol. 9, No. 48 Headlines A R G E N T I N A AVENIDA CORDOBA: Proofs of Claim Verification Is Until April 25 AVENIDA DEL TEJAR: Claims Verification Deadline Is April 25 AVENIDA SAN MARTIN: Claims Verification Is Until April 25 BOEDO 1967: Proofs of Claim Verification Deadline Is April 25 CEREAL PRO: Files for Reorganization in Court CHRYSLER LLC: Has Unlimited Access to Daimler AG's Technology GIRASOLES DEL CAMPO: Files for Reorganization in Court HOTEL GRAN DUC: Proofs of Claim Verification Deadline Is May 5 MIGUEL ACOSTA: Trustee to Verify Proofs of Claim Until April 4 PAGLIETTINI SA: Files for Reorganization in Court RED HAT: Hires Robert Tiller & Richard Fontana as Counsel ROOSEVELT 5269: Proofs of Claim Verification Ends on April 25 VALEANT PHARMA: To Restate Financial Statements Due to Errors WESTERN OIL: Proofs of Claim Verification Is Until May 2 B A H A M A S PINNACLE ENT: Posts US$19 Mil. Net Loss in Quarter Ended Dec. 31 B E R M U D A ANNUITY & LIFE: Closes Sale of American Unit to Heritage Union INTELSAT LTD: Subsidiaries Commence Change of Control Offers TYCO INT'L: Sells Nippon Dry-Chemical Biz to Daiwa Securities B R A Z I L AAR CORP: Closes Avborne Heavy Maintenance Acquisition BANCO BMG: Says Bond Issue to Bring In at Least US$100 Million BANCO BRADESCO: BBVA Sells 5% Stake for EUR976 Million BANCO NACIONAL: Board Grants BRL354.7 Million Loan to Coelce BANCO NACIONAL: Approves BRL38.1 Mil. Financing to Deib Otoch COMPANHIA ENERGETICA: Earns BRL178.6 Million in 2007 DELPHI CORP: Gets Exit Financing Proposal from General Motors DRESSER-RAND: Earnings Rise to US$44MM in Quarter Ended Dec. 31 ENERGIAS DO BRASIL: 2007 Net Income Rises 11.6% to BRL439.8MM GENERAL MOTORS: Offers Additional Exit Financing to Delphi Corp. GENERAL MOTORS: American Axle Strike Affects More GM Plants GERDAU SA: Has Most Expertise in Acquisitions, Analyst Says HEXION SPECIALTY: Discloses Post-Merger Senior Officers JBS SA: Major Acquisition Spurs Moody's to Continue Review MERCANTIL DO BRASIL: Earns BRL36.7 Million in 2007 NATIONAL BEEF: JBS Buyout Cues Moody's to Change Outlook to Neg. SMITHFIELD FOODS: Asset Sale Prompts Moody's to Hold Ba2 Ratings USINAS SIDERURGICA: Concludes BRL500 Million Debenture Issuance * BRAZIL: Moody's Eyes Solid Growth for Homebuilding Industry C A Y M A N I S L A N D S ATLANTIS YACHTING: Proofs of Claim Filing Is Until March 17 GUIMARAES DE MELLO: Final Shareholders' Meeting Is on March 16 MERLIN BIOMED: Sets Final Shareholders' Meeting for March 14 MORLEY BALANCED: Final Shareholders' Meeting Is on March 17 TIME FOR US: Proofs of Claim Filing Deadline Is March 17 C H I L E AES GENER: Shareholders Okay US$350 Million Capital Increase ROCK-TENN CO: Completes Southern Container Acquisition C O L O M B I A QUEBECOR WORLD: WEB Printing Backs Reclamation Objections QUEBECOR WORLD: Reaches Settlement With Utility Providers QUEBECOR WORLD: Seeks to Reject Banc of America Aircraft Lease QUEBECOR WORLD: Six Creditors Balk at US$1 Billion DIP Facility SOLUTIA INC: Flexsys Unit Raises Prices to Ensure Reinvestment SOLUTIA INC: Agrees to GE Betz's $255,575 Unsecured Claim SOLUTIA INC: To Issue 7,450,000 Shares for Employee Plans C O S T A R I C A COVANTA HOLDING: Earns US$72 Million in Quarter Ended Dec. 31 SIRVA INC: Agrees With Creditors on Prepetition Claims Payment SIRVA INC: Court Approves Hiring of Kirkland & Ellis as Attorney SIRVA INC: Court Approves Motion to Hire E&Y as Accountant SIRVA INC: Court Allows Rejection of Devens & Bridgewater Leases US AIRWAYS: Will Pay US$1.88 Million to Boston City US AIRWAYS: Gets Approval to Modify Agreements With United US AIRWAYS: Employees Want Management to Address Labor Issues US AIRWAYS: Various Entities Disclose Ownership of Interest E L S A L V A D O R AES CORP: POSCO Engineering to Build Plant for El Salvador Unit G U A T E M A L A BANCO INDUSTRIAL: Takes Over Banquetzal GOODYEAR TIRE: Fitch Lifts Issuer Default Rating to BB- From B+ J A M A I C A NATIONAL COMMERCIAL: AIC Barbados Sells 13.6MM Shares in Firm M E X I C O BERRY PLASTICS: B. Scheu Takes Helm at Rigid Closed Top Division CEMEX SAB: Sees Increased Synergies from Rinker Integration CLEAR CHANNEL: Trial on Sale Funding Dispute Set for April 7 EMPRESAS ICA: Industrial Unit Bags US$100 Mil. Deal With Energia INTERNATIONAL RECTIFIER: Tom Lacey Joins Board of Directors P A N A M A AES CORP: Defaults on Debt Facilities due to Misrepresentation P E R U CUMMINS INC: Names Jean Blackwell as EVP & CEO of Foundation P U E R T O R I C O DIRECTV GROUP: Amends Distribution Pact With Crown Media GENESCO INC: Terminates Finish Line-Merger and Settles Dispute GENESCO INC: Merger Termination Cues S&P to Hold B+ Rating UNIVISION COMM: Posts US$314.8 Million Net Loss in 2007 V E N E Z U E L A PETROLEOS DE VENEZUELA: Foreign Clients Must Pay Through Bank PETROLEOS DE VENEZUELA: Gets OPEC'S Support in Exxon Conflict X X X X X X * Moody's Says LatAm Telecom Industry Faces Competitive Pressure - - - - - ================= A R G E N T I N A ================= AVENIDA CORDOBA: Proofs of Claim Verification Is Until April 25 --------------------------------------------------------------- Estudio Bejar, Pantin y Asoc., the court-appointed trustee for Avenida Cordoba 4867 S.A.'s bankruptcy proceeding, will be verifying creditors' proofs of claim until April 25, 2008. Estudio Bejar will present the validated claims in court as individual reports on June 12, 2008. The National Commercial Court of First Instance in Buenos Aires 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 Avenida Cordoba 4867 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 Avenida Cordoba's accounting and banking records will be submitted in court on Aug. 15, 2008. Estudio Bejar is also in charge of administering Avenida Cordoba's assets under court supervision and will take part in their disposal to the extent established by law. The trustee can be reached at: Estudio Bejar, Pantin y Asoc. Suipacha 211 Buenos Aires, Argentina AVENIDA DEL TEJAR: Claims Verification Deadline Is April 25 ----------------------------------------------------------- Estudio Bejar, Pantin y Asoc., the court-appointed trustee for Avenida del Tejar 2551 S.A.'s bankruptcy proceeding, will be verifying creditors' proofs of claim until April 25, 2008. Estudio Bejar will present the validated claims in court as individual reports on June 12, 2008. The National Commercial Court of First Instance in Buenos Aires 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 Avenida del Tejar 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 Avenida del Tejar's accounting and banking records will be submitted in court on Aug. 15, 2008. Estudio Bejar is also in charge of administering Avenida del Tejar's assets under court supervision and will take part in their disposal to the extent established by law. The trustee can be reached at: Estudio Bejar, Pantin y Asoc. Suipacha 211 Buenos Aires, Argentina AVENIDA SAN MARTIN: Claims Verification Is Until April 25 --------------------------------------------------------- Estudio Bejar, Pantin y Asoc., the court-appointed trustee for Avenida San Martin 5404 S.A.'s bankruptcy proceeding, will be verifying creditors' proofs of claim until April 25, 2008. Estudio Bejar will present the validated claims in court as individual reports on June 12, 2008. The National Commercial Court of First Instance in Buenos Aires 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 Avenida San Martin 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 Avenida San Martin's accounting and banking records will be submitted in court on Aug. 15, 2008. Estudio Bejar is also in charge of administering Avenida San Martin's assets under court supervision and will take part in their disposal to the extent established by law. The trustee can be reached at: Estudio Bejar, Pantin y Asoc. Suipacha 211 Buenos Aires, Argentina BOEDO 1967: Proofs of Claim Verification Deadline Is April 25 ------------------------------------------------------------- Estudio Bejar, Pantin y Asoc., the court-appointed trustee for Boedo 1967 S.A.'s bankruptcy proceeding, will be verifying creditors' proofs of claim until April 25, 2008. Estudio Bejar will present the validated claims in court as individual reports on June 12, 2008. The National Commercial Court of First Instance in Buenos Aires 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 Boedo 1967 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 Boedo 1967's accounting and banking records will be submitted in court on Aug. 15, 2008. Estudio Bejar is also in charge of administering Boedo 1967's assets under court supervision and will take part in their disposal to the extent established by law. The trustee can be reached at: Estudio Bejar, Pantin y Asoc. Suipacha 211 Buenos Aires, Argentina CEREAL PRO: Files for Reorganization in Court --------------------------------------------- Cereal Pro S.A. has requested for reorganization approval after failing to pay its liabilities. The reorganization petition, once approved by the court, will allow Cereal Pro 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: Cereal Pro S.A. Uruguay 705 Buenos Aires, Argentina CHRYSLER LLC: Has Unlimited Access to Daimler AG's Technology ------------------------------------------------------------ Daimler AG granted Chrysler LLC a no-frills access to its advanced technology, Mike Spector of The Wall Street Journal reports. Chrysler can use the technology in order to pursue and enhance fuel-economy and mileage on its products, says WSJ, citing Chrysler vice chairman Jim Press at a Geneva auto convention. Chrysler previously streamlined its production by rejecting the "car cloning" practice, and instead will focus on selling its remaining, unique car models. As reported in the Troubled Company Reporter on Feb. 27, 2008, the company's streamlining measures came after it lost its tooling battle with Plastech Engineered Products Inc. The U.S. Bankruptcy Court for the Eastern District of Michigan denied the company's request to pull out tooling equipment from Plastech's plants. About Chrysler LLC Based in Auburn Hills, Michigan, Chrysler LLC -- http://www.chrysler.com/-- a unit of Cerberus Capital Management LP, produces Chrysler, Jeep(R), Dodge and Mopar(R) brand vehicles and products. The company has dealers worldwide, including Canada, Mexico, U.S., Germany, France, U.K., Argentina, Brazil, Venezuela, China, Japan and Australia. * * * As reported in the Troubled Company Reporter-Latin America on Nov. 13, 2007, Standard & Poor's Ratings Services affirmed its 'B' corporate credit rating on Chrysler LLC and DaimlerChrysler Financial Services Americas LLC and removed it from CreditWatch with positive implications, where it was placed Sept. 26, 2007. S&P said the outlook is negative. GIRASOLES DEL CAMPO: Files for Reorganization in Court ------------------------------------------------------ Girasoles del Campo SA has requested for reorganization approval after failing to pay its liabilities since Feb. 14, 2008. The reorganization petition, once approved by the court, will allow Girasoles del Campo 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. 3 in Buenos Aires. Clerk No. 5 assists the court in this case. The debtor can be reached at: Girasoles del Campo SA Corrientes 2330 Buenos Aires, Argentina HOTEL GRAN DUC: Proofs of Claim Verification Deadline Is May 5 -------------------------------------------------------------- Raul Trejo, the court-appointed trustee for Hotel Gran Duc S.A.'s bankruptcy proceeding, will be verifying creditors' proofs of claim until May 5, 2008. Mr. Trejo will present the validated claims in court as individual reports on June 16, 2008. The National Commercial Court of First Instance in Buenos Aires 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 Hotel Gran Duc 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 Hotel Gran Duc's accounting and banking records will be submitted in court on Aug. 14, 2008. Mr. Trejo is also in charge of administering Hotel Gran Duc's assets under court supervision and will take part in their disposal to the extent established by law. The debtor can be reached at: Hotel Gran Duc S.A. Jose E. Uriburu 1544 Buenos Aires, Argentina The trustee can be reached at: Raul Trejo Avenida Corrientes 818 Buenos Aires, Argentina MIGUEL ACOSTA: Trustee to Verify Proofs of Claim Until April 4 -------------------------------------------------------------- The court-appointed trustee for Miguel Acosta e Hijos S.R.L.'s reorganization proceeding will be verifying creditors' proofs of claim until April 4, 2008. The trustee will present the validated claims in court as individual reports. The National Commercial Court of First Instance in Cordoba 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 Miguel Acosta 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 Miguel Acosta's accounting and banking records will be submitted in court. Infobae didn't state the submission dates for the reports. The debtor can be reached at: Miguel Acosta e Hijos S.R.L. Avenida Velez Sarfield 79, Ciudad de Cordoba Cordoba, Argentina PAGLIETTINI SA: Files for Reorganization in Court ------------------------------------------------- Pagliettini SA has requested for reorganization approval after failing to pay its liabilities since July 16, 2007. The reorganization petition, once approved by the court, will allow Pagliettini 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. 11 in Buenos Aires. Clerk No. 22 assists the court in this case. The debtor can be reached at: Pagliettini SA Diaz Colodrero 3130 Buenos Aires, Argentina RED HAT: Hires Robert Tiller & Richard Fontana as Counsel --------------------------------------------------------- Red Hat Inc. has appointed intellectual property experts Robert Tiller, as Vice President and Assistant General Counsel, and Richard Fontana, as Open Source Licensing and Patent Counsel. Both will report to Executive Vice President and General Counsel, Michael Cunningham. Mr. Tiller brings over 20 years of legal expertise to Red Hat and joins the company from Helms, Mulliss & Wicker, where he gained experience in intellectual property and technology litigation, commercial litigation and antitrust. Previously, Mr. Tiller was an Associate Partner at Parker, Poe, Adams & Bernstein, focusing on intellectual property and technology, business torts and employment, education and general commercial litigation. Mr. Tiller also held roles as Associate for Onek, Klein & Farr, as Clerk for Antonin Scalia of the United States Supreme Court and as Clerk for Stephen Williams of the United States Court of Appeals for the District of Columbia Circuit. Mr. Tiller earned his J.D. From the University of Virginia School of Law and received his bachelor�s degree from Oberlin College. At Red Hat, Mr. Tiller will be responsible for overseeing the Company�s internal intellectual property team, with responsibilities covering open source licensing, copyright, patent and trademark. Additionally, Mr. Tiller will work on the development of new policies and strategies related to legal issues in open source. Mr. Fontana most recently served as Counsel for the Software Freedom Law Center, where he partnered with Eben Moglen to advise the Free Software Foundation on the drafting of version 3 of the GNU General Public License. In this role, Mr. Fontana drafted GPLv3 license provisions, analyzed and advised clients on competing proposals, conducted the public GPLv3 discussion process, led GPLv3 discussion committees and researched matters of U.S. and international copyright and patent law. Prior to his work on GPLv3, Mr. Fontana prepared and prosecuted patent applications as an Associate at Darby & Darby, P.C. and Leydig, Voit & Mayer, Ltd. At Rogers & Wells, he was an Associate in the firm�s Litigation Department, where he worked in intellectual property, antitrust and securities litigation practice groups. Mr. Fontana received his J.D. From the University of Michigan Law School, earned master�s degrees in Computer Science from New York University and Yale University and obtained his bachelor�s degree in History from Wesleyan University. At Red Hat, Mr. Fontana will manage matters relating to patents and open source licensing. He will also serve as a Red Hat liaison with the open source community on licensing issues. "It is an honor to call these experienced intellectual property litigators Red Hat�s own," said Mr. Cunningham. "With the combination of Richard and Robert�s backgrounds, our team has gained important ground in regard to intellectual property, open source licensing and patents -- areas that have increasingly gained importance in the success of Red Hat and the open source community." Mr. Fontana will be based at Red Hat�s Westford, Mass. office. Tiller will be based at Red Hat�s headquarters in Raleigh, N.C. Headquartered in Raleigh, North Carolina Red Hat, Inc. -- http://www.redhat.com/-- is an open source and Linux provider. Red Hat provides operating system software along with middleware, applications and management solutions. Red Hat also offers support, training, and consulting services to its customers worldwide and through top-tier partnerships. The company has offices in Singapore, Germany, and Argentina, among others. * * * As reported in the Troubled Company Reporter-Latin America on Oct. 19, 2007, Standard & Poor's Ratings Services revised its outlook on Red Hat Inc. to positive from stable and affirmed the ratings, including the 'B+' corporate credit rating. ROOSEVELT 5269: Proofs of Claim Verification Ends on April 25 ------------------------------------------------------------- Estudio Bejar, Pantin y Asoc., the court-appointed trustee for Roosevelt 5269 S.A.'s bankruptcy proceeding, will be verifying creditors' proofs of claim until April 25, 2008. Estudio Bejar will present the validated claims in court as individual reports on June 12, 2008. The National Commercial Court of First Instance in Buenos Aires 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 Roosevelt 5269 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 Roosevelt 5269's accounting and banking records will be submitted in court on Aug. 15, 2008. Estudio Bejar is also in charge of administering Roosevelt 5269's assets under court supervision and will take part in their disposal to the extent established by law. The trustee can be reached at: Estudio Bejar, Pantin y Asoc. Suipacha 211 Buenos Aires, Argentina VALEANT PHARMA: To Restate Financial Statements Due to Errors ------------------------------------------------------------- Valeant Pharmaceuticals International disclosed in a regulatory filing that its Board of Directors on March 1, 2008, determined that certain of the company's annual and interim financial statements, earnings press releases and similar communications, should no longer be relied upon. During the preparation process for the 2007 Annual Report on Form 10-K, the company identified certain accounting errors related to certain foreign operations which primarily arose during the period Jan. 1, 2002, to Sept. 30, 2007, and, in aggregate, would have resulted in a net charge to income from continuing operations before income taxes of approximately US$2.8 million to correct the cumulative effect of the errors in the fourth quarter of 2007. These included adjustments impacting annual periods prior to 2007 with a cumulative charge to income from continuing operations before income taxes of approximately US$5.2 million as of Jan. 1, 2007. The adjustments also included items originating in the first, second and third quarters of 2007 with a net benefit to income from continuing operations before income taxes of approximately US$2.4 million. The errors and the estimated cumulative effect of the corrections are: a. Increase in reserves for anticipated product returns based on historical trends and for certain credit memos in Mexico, the cumulative effect of which is an expected reduction in revenue of approximately US$4.0 million; b. Decrease in revenues associated with sales to certain customers in Italy where preexisting rights of return became known in the fourth quarter of 2007, the cumulative effect of which is an estimated reduction of revenues of approximately US$1.8 million; c. Decrease in costs of goods sold related to bookkeeping errors in recording inventory costing and manufacturing variances in the UK and France, the cumulative effect of which is an expected reduction in cost of goods sold and a corresponding increase in gross profit of approximately US$4.9 million; d. Increase in pension expense in the UK and the Netherlands resulting from incorrect application of Statement of Financial Accounting Standard No. 87, Employers Accounting for Pensions, the cumulative effect of which is an expected increase in general and administrative expenses of approximately US$1.9 million; and e. Increase in income tax expense due to correction of deferred income taxes in certain foreign locations resulting in a decrease in income of approximately US$500,000. Additionally income tax expense is reduced by approximately US$800,000 resulting from the income tax effects of the pre-tax adjustments described above. About Valeant Pharmaceuticals Headquartered in Costa Mesa, California, Valeant Pharmaceuticals International (NYSE: VRX) -- http://www.valeant.com/-- is a global specialty pharmaceutical company that develops, manufactures and markets a broad range of pharmaceutical products primarily in the areas of neurology, infectious disease and dermatology. It has offices in Argentina, Singapore and Taiwan. * * * In January 2007, Moody's Investors Service confirmed the ratings of Valeant, including the B2 Corporate Family Rating, and concluded the rating review for possible downgrade, which was first initiated on Oct. 23, 2006. Ratings hold to date. WESTERN OIL: Proofs of Claim Verification Is Until May 2 -------------------------------------------------------- Ignacio Victor Kaczer, the court-appointed trustee for Western Oil S.R.L.'s bankruptcy proceeding, will be verifying creditors' proofs of claim until May 2, 2008. Mr. Kaczer will present the validated claims in court as individual reports on June 13, 2008. The National Commercial Court of First Instance in Buenos Aires 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 Western Oil 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 Western Oil's accounting and banking records will be submitted in court on Aug. 12, 2008. Mr. Kaczer is also in charge of administering Western Oil's assets under court supervision and will take part in their disposal to the extent established by law. The trustee can be reached at: Ignacio Victor Kaczer Avenida Callao 441 Buenos Aires, Argentina ============= B A H A M A S ============= PINNACLE ENT: Posts US$19 Mil. Net Loss in Quarter Ended Dec. 31 ---------------------------------------------------------------- Pinnacle Entertainment Inc. reported financial results for the fourth quarter and full year ended Dec. 31, 2007. For the fourth quarter of 2007, on a Generally Accepted Accounting Principles basis, the company reported a net loss of US$19.2 million compared to a net loss of US$5 million in the same quarter of 2006. The change in results reflects increased pre-opening and development expenses related to the company's development activities, the hiring, training and marketing costs for the Lumiere Place Casino, and additional depreciation costs associated with that new property and a full quarter's ownership of The Admiral Riverboat Casino. Partially offsetting these costs is an increase in capitalized interest. For the full year, on a GAAP basis, the net loss for the year ended Dec. 31, 2007, was US$1.4 million compared to net income of US$76.9 million for the same period in the previous year. The 2006 results included the performance at Boomtown New Orleans, net proceeds of approximately US$44.7 million related to the terminated merger agreement with Aztar Corporation and pre-tax gains of US$27.2 million from the sale of the California card club operations. While the company had a slight net loss in 2007, the company has substantial operating cash flow due to its depreciation charges, reflecting the fact that much of its assets were built by the company in recent years. On a GAAP basis, cash flow from operations was US$145 million and US$207 million for the years ended Dec. 31, 2007, and 2006. Cash flow from operations before pre-opening and development expenses(1) was US$205 million and US$234 million for the years ended Dec. 31, 2007 and 2006. "Our company made significant progress in 2007," Daniel R. Lee, chairman and chief executive officer of Pinnacle Entertainment, said. "Our existing operations performed solidly overall in 2007, including a record year at L'Auberge and a near-record year at Belterra. Our New Orleans property stabilized at strong levels of profitability and we completed and opened Lumiere Place. "Strategically, we remain focused on reinvesting our shareholders' cash flow into new casino resorts with compelling and innovative designs, tying them together into a national network," Mr. Lee continued. "We continue to cultivate each of the projects in our growth pipeline while carefully monitoring the credit markets." "These development projects often take years of work, including acquiring the land and obtaining the necessary gaming licenses," Mr. Lee added. "In the early years, the cash outlays are relatively minor compared to the later stages of construction. The current disruption in the credit markets is quite severe and the availability of capital is constrained and, where available, its cost is quite high in comparison to the recent past. If interest rates for corporate borrowers such as us do not improve, it may be in our shareholders' best interests to delay such projects in our development pipeline until credit markets improve and the expected returns of such projects again exceed the anticipated long-term cost of capital." Liquidity The company had approximately $191 million in cash and cash equivalents at Dec. 31, 2007. Of the company's $625 million revolving credit facility, approximately $161 million is utilized, including $50 million borrowed in late 2007, $90 million borrowed in early 2008, and $21.2 million of letters of credit issued. Funding of Lumiere Place and the L'Auberge du Lac hotel expansion is substantially completed. Utilization of the credit facility is currently restricted to $350 million by the company's indenture governing its 8.75% senior subordinated notes, which become callable in 2008. At Dec. 31, 2007, the company's balance sheet showed total assets of $2.19 billion, total liabilities of $1.14 billion and total stockholders' equity of $1.05 billion. About Pinnacle Entertainment Headquartered in Las Vegas, Nevada, Pinnacle Entertainment Inc. (NYSE: PNK) -- http://www.pnkinc.com/-- owns and operates casinos in Nevada, Louisiana, Indiana, Missouri, Argentina and the Bahamas. The company also owns a hotel in Missouri. * * * Pinnacle Entertainment Inc. continues to carry Fitch's 'B' long- term issuer default rating, which was assigned in March 2007. ============= B E R M U D A ============= ANNUITY & LIFE: Closes Sale of American Unit to Heritage Union -------------------------------------------------------------- Heritage Union has purchased Annuity & Life Re (Holdings), Ltd.'s indirect, wholly-owned subsidiary, Annuity & Life Reassurance America, Inc. The acquisition enables Heritage Union and its family of companies to serve customers in 43 states, the District of Columbia and the United States territory of Guam and introduce its breakthrough SalaryShield(R) life insurance products. "This acquisition represents a major milestone in the history of our young company, giving us the capacity to begin widely serving those middle-income families who need the peace of mind and security that our products provide," said Heritage Union Chief Executive Officer. Philip Walker. "We now are able to accelerate our outreach to families across the country with products specifically designed to be more affordable, less complicated and more in tune with the many demands of their lives." Annuity and Life Re (Holdings), Ltd. announced the sale Aug. 8, 2007. The sale was approved by the Connecticut Department of Insurance in mid-February. In conjunction with the closing, Annuity and Life Reassurance America, Inc. paid a dividend of US$300,000 to its direct parent, Annuity & Life Re America, Inc. and it received proceeds from the buyer of US$11,058,716. This amount is subject to possible closing date balance sheet adjustments within ten business days following the sale transaction. The company will use a portion of the proceeds to pay transaction costs related to the sale. About Heritage Union Founded in 2005, the Richmond, Virgina-based Heritage Union Services, LLC -- http://www.salaryshield.com-- designs life insurance products aimed specifically at helping middle class American families protect their income in the face of premature death. SalaryShield is a registered servicemark of Heritage Union. About Annuity Life Re (Holdings) Ltd. Bermuda-based Annuity & Life Re (Holdings), Ltd. -- http://www.alre.bm/or -- http://www.annuityandlifere.com/-- provides annuity and life reinsurance to insurers through its wholly owned subsidiaries, Annuity & Life Reassurance, Ltd. and Annuity & Life Reassurance America, Inc. Going Concern Doubt Chartered Accountants of Hamilton, Bermuda, raised substantial doubt about Annuity and Life Re (Holdings), Ltd.'s ability to continue as a going concern after it audited the company's annual report for 2004. The auditor pointed to the company's significant losses from operations and experience of liquidity demands. Annuity and Life Re incurred losses for two consecutive quarters. The company posted a net loss of US$92,056 for the three months ended June 30, 2007, compared to a net loss of US$649,949 for the same period in 2006. The company incurred a net loss from continuing operations of US$88 million for the three months ended Sept. 30, 2007, as compared to a net loss from continuing operations of US$212.2 million for the same period in 2006. INTELSAT LTD: Subsidiaries Commence Change of Control Offers ------------------------------------------------------------ Intelsat Ltd.'s indirect wholly owned subsidiaries: -- Intelsat Subsidiary Holding Company, Ltd., has offered to purchase for cash any and all of its outstanding 8.25% Senior Notes due 2013 and 8.625% Senior Notes due 2015; and -- Intelsat Corporation is offering to purchase for cash any and all of its outstanding 9% Senior Notes due 2014 and 9% Senior Notes due 2016, in each case at a purchase price of 101% of the principal amount of those Notes. Intelsat Sub Holdco and Intelsat Corporation are required by the terms of the respective indentures governing the Notes to make these offers as a result of the previously announced acquisition of Intelsat Holdings, Ltd., the indirect parent of Intelsat, Ltd., by Intelsat Global Subsidiary, Ltd. (formerly known as Serafina Acquisition Limited), a direct wholly-owned subsidiary of Intelsat Global, Ltd. (formerly known as Serafina Holdings Limited), an entity formed by funds advised by BC Partners Holdings Limited, Silver Lake Partners and certain other equity investors. The Acquisition constitutes a change of control under each of the indentures governing the Notes. The terms of the change of control offers are described in a Notice of Change of Control and Offer to Purchase with respect to the Intelsat Sub Holdco Notes, a Notice of Change of Control and Offer to Purchase with respect to the 2014 Notes, and a Notice of Change of Control and Offer to Purchase with respect to the 2016 Notes, each dated March 5, 2008, and the Letters of Transmittal related thereto, which will be distributed to holders of the respective Notes. The change of control offers will expire at 5:00 p.m., New York City time, on April 29, 2008, and will have a settlement date of May 2, 2008. Holders whose Notes are accepted for payment pursuant to the offers will also receive accrued and unpaid interest to the Settlement Date. Intelsat Sub Holdco and Intelsat Corporation have retained Wells Fargo Bank, National Association to act as Depositary in connection with the change of control offers for the Intelsat Sub Holdco Notes and the 2016 Notes. Intelsat Corporation has retained The Bank of New York Mellon to act as Depositary in connection with the change of control offers for the 2014 Notes. 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. TYCO INT'L: Sells Nippon Dry-Chemical Biz to Daiwa Securities ------------------------------------------------------------- Tyco International Ltd. has sold its subsidiary, Nippon Dry- Chemical Co. Ltd., to the SPC owned by Daiwa Securities SMBC Principal Investments Co. Ltd., a subsidiary of Japan-based investment bank Daiwa Securities SMBC Co. Ltd., pursuant to an agreement entered into on Feb. 19, 2008. Financial terms were not announced. The sale of Nippon Dry-Chemical is one of a series of steps Tyco is taking to divest or exit certain non-core fire business in Asia and Latin America. These actions are part of a larger portfolio refinement strategy that includes the previously- announced sale of Tyco's Infrastructure Services unit as well as small bolt-on acquisitions of two technology businesses -- TridentTek and Retail Expert -- in Tyco's core electronic security business. Nippon Dry-Chemical manufactures and sells dry chemical fire extinguishers, fire trucks and security systems for the Japan market. The Tokyo-headquartered firm has about 420 employees. Nippon Dry-Chemical has been treated as a discontinued operation in Tyco's financial statements beginning with the first quarter of fiscal 2008. Based in Pembroke, Bermuda, Tyco International Ltd. (NYSE: TYC) -- http://www.tyco.com/-- provides security, fire protection and detection, valves and controls, and other industrial products and services to customers in four business segments: Electronics, Fire & Security, Healthcare, and Engineered Products & Services. With 2007 revenue of US$18 billion, Tyco employs approximately 118,000 people worldwide. In Latin America, Tyco has presence in Argentina, Brazil, Chile, Costa Rica, Ecuador, Honduras, and the Bahamas. Effective June 29, 2007, Tyco International Ltd. completed the spin-offs of Covidien and Tyco Electronics, formerly its Healthcare and Electronics businesses, respectively, into separate, publicly traded companies in the form of a distribution to Tyco shareholders. * * * As reported in the Troubled Company Reporter on Dec. 21, 2007, in its annual report for the year ended Sept. 28, 2007, Tyco said that on Nov. 8, 2007, The Bank of New York delivered to the company a notice of events of default. The notice claims that the actions taken by the company in connection with its separation into three public entities constitute events of default under certain indentures. =========== B R A Z I L =========== AAR CORP: Closes Avborne Heavy Maintenance Acquisition ------------------------------------------------------ AAR Corp. has completed the acquisition of Avborne Heavy Maintenance, Inc., an independent provider of aircraft heavy maintenance checks, modifications and painting services located in Miami, Florida. The newly acquired business will operate as part of the company's Maintenance, Repair and Overhaul (MRO) segment as AAR Aircraft Services -- Miami. The acquisition significantly increases the company's MRO capacity, workforce and capabilities. The move adds 226,000 square feet of modern hangar space at Miami International Airport and 467 aviation maintenance technicians, increasing AAR's hangar space by 22 percent and bringing the total number of aviation maintenance technicians to more than 2,000 worldwide. "We're very impressed with the strong management team, skilled workforce and the high levels of customer satisfaction that they've achieved at Avborne," said AAR Corp. Chairperson and Chief Executive Officer, David P. Storch. "The acquisition expands our capacity and capabilities at a time when airlines are seeking ways to operate more efficiently, lower their operating expenses and combat the rising cost of fuel." AAR achieved a 26% compound annual growth rate in its MRO segment over the past three years and was ranked among the top 10 MROs in the world according to a 2007 study conducted by Aviation Week's Overhaul and Maintenance magazine. About AAR Corp. AAR Corp. (NYSE: AIR) -- http://www.aarcorp.com/-- provides products and value-added services to the worldwide aviation and aerospace industry. With facilities and sales locations around the world, AAR uses its lose-to-the-customer business model to serve airline and defense customers through Aviation Supply Chain; Maintenance, Repair and Overhaul; Structures and Systems and Aircraft Sales and Leasing. In Asia Pacific, the company has offices in Singapore, China, Japan and Australia. In Latin America, the company has a sales office in Rio de Janeiro, Brazil. * * * AAR Corporation continues to carry Moody's Investors Service's 'Ba3' long-term corporate family rating, which was assigned on November 2006. BANCO BMG: Says Bond Issue to Bring In at Least US$100 Million -------------------------------------------------------------- Banco BMG wants to raise at least US$100 million from a two-year bond issue on the Luxembourg stock exchange. Business News Americas relates that the offering would close next week, with US investment bank BCP Securities handling the sale. According to BNamericas, the notes will mature in March 2010 and will pay a fixed coupon of 7%. Banco BMG told BNamericas that it will decide by July whether or not to conduct an initial public offering on the Sao Paulo stock exchange Bovespa. Banco BMG is the banking arm of Grupo BMG, which also has real estate, food manufacturing and agro industry holdings. The bank is a niche player focused on loans to civil servants, with repayments taken monthly from payrolls. BMG operates mainly through in-house representatives in state companies. It also offers leasing and asset management services. * * * As reported in the Troubled Company Reporter-Latin America on June 26, 2007, Standard & Poor's Ratings Services raised its long-term counterparty credit rating on Banco BMG S.A. to 'BB-' from 'B+'. The rating was removed from CreditWatch Positive where it was placed June 11, 2007. S&P said the outlook is stable. On Aug. 23, 2007, Moody's Investors Service placed a Ba2 long- term bank deposit rating on Banco BMG. BANCO BRADESCO: BBVA Sells 5% Stake for EUR976 Million ------------------------------------------------------ Banco Bilbao Vizcaya Argentaria, S.A., aka BBVA has decided to exercise the option to sell its 5.01% holding of ordinary stocks in Banco Bradesco SA, for EUR976 million, which will represent a capital gain of around EUR740 million for the group, at the time the transaction is closed. BBVA has decided to launch its own platform in Brazil to develop its global business activity, providing services to its corporate customers from Europe, the US, Latin America, and Asia. BBVA has been working with Banco Bradesco since January 2003, when it announced it had taken a stake in the Brazilian bank's capital via an agreement whereby it sold its subsidiary BBV Brazil to Banco Bradesco in exchange for US$632 million and 4.4% of its stock. The group subsequently raised its stake to over 5%. Five years later, BBVA informed the Spanish Securities Market Commission that it has exercised the option to sell its stake in Banco Bradesco to the majority shareholders of the Brazilian entity -- Cidade de Deus Companhia Comercial de Participacoes and Fundacao Bradesco -- in line with the Shareholders Agreement signed by both parties, which provided for this sale option through June 2010. The agreement with Banco Bradesco included a business area in the bank specializing in originating business between both entities, and provided for the bank to offer banking services to BBVA�s corporate customers in Brazil, along with other potential areas of cooperation within a non-competitive framework. About BBVA Banco Bilbao Vizcaya Argentaria, S.A., aka BBVA is a diversified international financial group with operations in retail banking, asset management, private banking and wholesale banking. BBVA is organized into five business areas: Retail Banking in Spain and Portugal, Wholesale Businesses, Mexico and the United States, South America and Corporate Activities. About Banco Bradesco Headquartered in Sao Paulo, Brazil, Banco Bradesco S.A. (NYSE: BBD) -- http://www.bradesco.com.br/-- prides itself on serving low-and medium-income individuals in Brazil since the 1960s. Bradesco is Brazil's largest private bank, with more than 3,000 banking branches, and also a leader in insurance and private pension management. Bradesco has branches throughout Brazil as well as one in New York, and Japan. Bradesco offers Internet banking, insurance, pension plans, annuities, credit card services (including football-club affinity cards for the soccer- mad population), and Internet access for customers. The bank also provides personal and commercial loans, along with leasing services. * * * On Nov. 12, 2007, Moody's Investors Service assigned a Ba2 foreign currency deposit rating to Banco Bradesco. BANCO NACIONAL: Board Grants BRL354.7 Million Loan to Coelce ------------------------------------------------------------ Banco Nacional de Desenvolvimento Economico e Social's board of directors has approved a BRL354.7 million financing to Companhia Energetica do Ceara [Energy Company of Ceara] - Coelce. The resources will be destined to the triennial investments plan -- 2007/2009 -- and transferred by Unibanco, Votorantim, Itau BBA and Bradesco. Coelce's program for the period, amounting to BRL652.7 million, encompasses expansion works, modernization and improvements in the electrical system, distributed throughout the municipalities that comprise its concession area in the State of Ceara. Amongst the operation's benefits, which will count on BNDES support of 54.3%, one finds the expansion of the supply of energy to new consumers and the improvement in quality and accountability of the supply of electric energy in the region where the distributor operates. Furthermore, it bears a regional development character that will generate jobs and the purchasing of equipment from national vendors. The investments plan also contemplates the construction and modernization of substations; implementation of information technology systems, automation and implementation of technical systems; modernization of communication systems; and widening and modernization of the sales and administrative infrastructure. BNDES has already approved, since 2003, 188 electric energy projects, totaling financings of BRL29 billion, which opened room for total investments of BRL49.7 billion. Within that period, the Bank's support enabled 14.4 thousand MW of installed capacity generation. As to distribution, BNDES approved 28 projects, equivalent to financings of BRL3.9 billion and total investments of BRL6.6 billion. Coelce, a company from the Endesa Brasil group, controlled by Spanish Company Endesa, manages several projects focused on environmental education and performs impact studies of its activity upon the environment, with regards to the supply of clean and safe energy. It participates in Clean Development Mechanism [MDL] projects, based on the Kyoto protocol, and is signatory of the United Nations' Global Pact. Amongst the environmental projects and actions developed, one may highlight the development of ecological oils for transformers in partnership with Parque de Desenvolvimento Tecnologico [Technological Development Complex] and with Universidade Federal do Ceara [Federal University of Ceara]; the development of Composting Process for Recycling of Tree Trimming Tailings; and the Solid Wastes Management Program, in which the final disposal of lamps for recycling is underlined. In 2006, Coelce contracted 7.8 thousand GWh of electric energy, from which 56% derived from hydraulic sources, 43% from thermal energy and 1% from wind energy. 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. BANCO NACIONAL: Approves BRL38.1 Mil. Financing to Deib Otoch ------------------------------------------------------------- Banco Nacional de Desenvolvimento Economico e Social's directors have approved a BRL38.1 million financing to Deib Otoch S.A. The credit is destined to expansion of the retail network, upon the opening of ten stores in the Northern and Northeastern Regions, during the period 2008-2009. The new stores will be located in the States of Bahia, Piaui, Rio Grande do Norte, Ceara, Maranhao, Sergipe and Para. The Bank's participation corresponds to 66% of total project investment, of BRL58 million. The funds will be transferred through Banco Bradesco S.A. Among the merits of the operation, the Bank can highlight the consolidation of the retail network presence in the Northeastern Region, expansion of activities to the Northern Region and the estimated generation of approximately 840 direct jobs in the stores and 4 thousand indirect ones, as suppliers, transportation, cafeteria, cleaning, maintenance and security guard service providers, among others. Currently, around 60% of its suppliers are micro, small and medium-sized companies, mainly confections, handicraft and service provision, and 62% originated in the Northeastern Region. The company - Headquartered in Fortaleza, Deib Otoch operates in the retail commerce, under the flags "Esplanada" and "By Express", having, as its main products, confections of women's, men's, infant and baby clothes, bed, table and bath linen, decoration items, shoes, perfumes, CDs, watches, traveling items, among others. The supply of merchandises to the stores is carried out by means of a proprietary Distribution Center, located by the company administrative headquarters. The network has 30 department stores spread throughout eight States of the Northeastern Region and the Federal District. The flow of clients in the stores is estimated to be in the range of 2.5 million per year. Upon project completion, company invoicing is expected to increase by 72%. 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. COMPANHIA ENERGETICA: Earns BRL178.6 Million in 2007 ---------------------------------------------------- Companhia Energetica de Sao Paulo's net income was BRL178.6 million in 2007, compared to a loss of BRL118.4 million in 2006. EBITDA increased 19.4% to BRL1.5 billion in 2007, energy sales rose 9.5% to BRL2.6 billion. Net Operating Revenue increased 8.5% to BRL2.2 billion in 2007, from 2006. Revenue from services rose 31.7% to BRL1.0 billion. Net debt dropped by 15.7% to BRL5.9 billion in 2007, compared to BRL6.9 billion in 2006. Net financial result was an expense of BRL314.3 million, improving by 64.7% in relation to the expense of BRL889.3 million in 2006. Companhia Energetica's privatization process resumed in the fourth quarter 2007, with the auction scheduled for March 26 on the Sao Paulo Stock Exchange (BOVESPA), with a minimum set price of BRL49.75 per share. In 2007, assured energy was commercialized in these environments: i) Regulated Contracting Environment (ACR) through Energy Purchase Contracts in the Regulated Environment (CCEAR) with distributors, as well as sales contracts with small distributors with loads of less than 500 giga watts per year; ii) Free Contracting Environment (ACL), through long-, medium- and short-term (ex-post) energy sales contracts negotiated with sellers and free consumers; and iii) the differences between generated energy, assured energy and contracted energy were booked and settled at the Electricity Commercialization Board (CCEE). Companhia Energetica's customers are the main energy distributors in Brazil, which buy its output through long-term contracts and auctions and in the regulated market; and free consumers, including sellers and large final consumers in the industry, which acquire their power through medium- and long- term bilateral contracts. Revenue from electricity sales in the regulated environment (49%) continued to surpass sales in the free contracting environment (47%). The Electricity Commercialization Board (CCEE) accounted for 4% of power sales. Energy Sales totaled 2007 in BRL2,624.8 million, 9.5% higher year on year, driven mainly by energy prices in the free contracting environment, which includes both electricity supply contracts to large consumers and supply contracts with agents. Deductions from revenue in 2007 totaled BRL441.8 million, up 14.4% in relation to the BRIL386.2 million in 2006. These deductions represent 16.8% of gross revenue, versus 16.1% in 2006. Net Operating Revenue in 2007 reached BRL2,183.7 million, 8.5% higher than in 2006. Operating Expenses in the year stood at BRL1,162.8 million, 6% lower year on year. The reduction was due to the accounting of an actuarial adjustment at the Companhia Energetica Foundation and expenses with provisions for the realization of credits and operating provisions, charges for use of the grid/transmission system services (tariffs set by ANEEL), as well as other expenses that increased in the year. In 2007, EBIT rose to BRL1,020.9 million, growing by 31.7% year on year, for EBIT margin of 46.7%. The increase was driven by higher revenue and the actuarial adjustment at the private pension plan for employees. As a result, net income was BRL178.6 million in 2007, with growth in non-operating income of 770%. EBITDA reached BRL1,499.9 million in 2007, an increase of 19.4% year on year, with EBITDA margin of 68.7%, expanding by 6.3 percentage points in relation to 2006. The Net Financial Result was an expense of BRL314.3 million in 2007, versus an expense of BRL889.3 million a year earlier. The company�s debt was the main factor in its net financial result. Debt denominated in foreign currency, which accounts for 36% of total debt, was benefited by the appreciation of 17.2% in the Brazilian real against the U.S. dollar, which provided a foreign-exchange gain of BRL520 million. A negative factor was the accounting of debt charges of BRL502 million (denominated in both local and foreign currency), as well as expenses with local monetary restatement in the amount of BRL327 million. On Dec. 31, 2007, Companhia Energetica's balance sheet had Total Debt of BRL6,702.2 million, down 11.1% in relation to 2006. On the same date, Cash and Cash Equivalents totaled BRL679.7 million, versus BRL328.6 million in 2006. Beyond interest of BRL165.0 million paid in advanced in 2007. The amount represents the balance of funding from the fund FIDC IV in the amount of BRL1.25 billion, which was allocated for paying down debt. Net Debt totaled BRL5,857.5 million, a decline of 15.7% in comparison with 2006. In October 2007, the Treasury Department of the State of Sao Paulo, in conformance with State Decree No. 51,760 dated April 17, 2007, contracted Banco Fator S.A. to execute Service A (the economic-financial valuation) and the consortium led by Banco Citibank S.A. to execute Service B ( the economic- financial valuation, modeling and sale execution) involving Companhia Energetica. Based on the studies presented by the contracted parties, the Executive Council of the State Privatization Program (PED) recommended to the state�s governor (which he duly approved in December 2007) the resumption of the work and studies required for the company�s privatization, with the privatization auction slated for the end of the first quarter of 2008. On Feb. 25, 2008, the Privatization Notice was made available; containing the conditions for the auction process, including the minimum set auction price of BRL49.75 per share per share. According to the Privatization Notice, the privatization auction of Companhia Energetica is scheduled for March 26, 2008 at the Sao Paulo Stock Exchange (Bovespa). In 2007, the Ibovespa index rose by 41% and the Electricity Index (IEE) increased by 23%. Headquartered in Sao Paulo, Brazil, Companhia Energetica de Sao Paulo (BOVESPA: CESP3, CESP5 and CESP6) is the country's third largest power generator, majority owned by the State of Sao Paulo. CESP operates 6 hydroelectric plants with total installed capacity of 7,456 MW and reported net revenues of BRL1,983 million in the last twelve months through Sept. 30, 2006. As reported in the Troubled Company Reporter-Latin America on Oct. 10, 2007, Standard & Poor's Ratings Services raised its ratings on electricity generator Companhia Energetica de Sao Paulo, including its corporate credit rating to 'B' from 'B-'. At the same time, S&P raised its Brazil national scale ratings on CESP to 'brBBB-' from 'brBB'. S&P said the outlook remains positive on both scales. DELPHI CORP: Gets Exit Financing Proposal from General Motors ------------------------------------------------------------- Delphi Corp. is taking the steps necessary to enable the completion of its exit financing syndication. Delphi said that it has been advised by General Motors Corp. that GM is prepared to provide additional exit financing. The company's US$6.1 billion exit financing package is now expected to include a US$1.6 billion asset-backed revolving credit facility, at least US$1.7 billion of first-lien term loan, an up to US$2.0 billion first-lien term note to be issued to GM (junior to the US$1.7 billion first-lien term loan), and an US$825 million second-lien term loan, of which any unsold portion would be issued to GM. Delphi believes that GM's increased participation in the exit financing structure is necessary to successfully syndicate its exit financing on a timely basis and is consistent with its First Amended Joint Plan of Reorganization and the investment agreement with its plan investors. However, certain of Delphi's plan investors have advised the company they believe the proposed exit financing with increased GM participation would not comply with conditions in the company's investment agreement between Delphi and the plan investors. To clarify that GM's increased participation complies with the Plan and the investment agreement, and to require each of the Plan Investors to perform their obligations under the investment agreement, Delphi asks the U.S. Bankruptcy Court for the Southern District of New York seeking limited relief from the Court under section 1142 of the Bankruptcy Code with respect to the Plan, which was confirmed by the Court on Jan. 25, 2008. Under Section 1142 of the Bankruptcy Code, bankruptcy courts may direct the debtor and any other necessary party to perform any act that is necessary for the consummation of a plan that has been confirmed by the Bankruptcy Court. Delphi's lead plan investor has also agreed to extend from March 31, 2008 to Apr. 5, 2008 the first date by which it could terminate the investment agreement with Delphi if the effective date of the Plan has not occurred, which would provide Delphi additional time to comply with closing conditions under the investment agreement. About GM 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. 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. About Delphi Corp. 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. DRESSER-RAND: Earnings Rise to US$44MM in Quarter Ended Dec. 31 --------------------------------------------------------------- Dresser-Rand Group Inc. reported financial results for fourth quarter and year ended Dec. 31, 2007. The company reported net income of US$43.8 million for the fourth quarter 2007, compared with net income of US$32.9 million for the fourth quarter 2006. Net income was US$106.7 million for 2007 compared to a net income of US$78.8 million for 2006. "2007 was a year of record performance. Revenues increased 11%, operating income increased 12% and our year-end backlog was at a record level," Vincent R. Volpe Jr., president and chief executive officer of Dresser-Rand, said. "Consistent with our expectation at the start of the fourth quarter, we experienced a strong recovery in our aftermarket bookings and shipments," Mr. Volpe added. "Aftermarket bookings in the fourth quarter of 2007 increased approximately 16% over the fourth quarter of 2006. "I am also pleased that our bargaining unit employees at our Painted Post, New York facility have returned to work after a 17 week work stoppage," Mr. Volpe continued. "They have chosen to return to work under the terms of the company's implemented last offer, which includes important changes to work rules and the elimination of future retiree healthcare benefits for certain employees." "We had expected to be able to record a non-cash curtailment gain in 2007 in connection with the elimination of retiree heathcare benefits for certain employees, Mr. Volpe related. "However, it has been determined that the benefit change as implemented represents a plan amendment. Therefore, the resulting curtailment amendment reduction of US$18.6 million in the accumulated benefit obligation is expected to be amortized to income over 36 months beginning in January 2008." "We enter 2008 with a backlog of approximately US$1.9 billion, continuing strong markets and a well-defined business strategy focused on increased production and bolt-on acquisitions," he said. Liquidity and Capital Resources As of Dec. 31, 2007, cash and cash equivalents totaled US$206.2 million and borrowing availability under the company's US$500 million senior secured credit facility was US$273.0 million, as US$227.0 million was used for outstanding letters of credit. In 2007, cash provided by operating activities was US$216.0 million compared to US$164.1 million in 2006. The increase of US$51.9 million in net cash provided by operating activities was principally from changes in working capital and improved operating performance. In 2007, net capital investments totaled US$26.0 million and the company prepaid US$137.2 million of its outstanding indebtedness under its senior secured credit facility. As of Dec. 31, 2007, total debt was US$370.5 million and total debt net of cash and cash equivalents was approximately US$164.3 million. In August 2007, the company amended its senior secured credit facility. The amended credit facility is a five year, US$500 million revolving credit facility. The amendment increased the size of the facility by US$150 million, lowered borrowing costs 50 basis points to LIBOR plus 150 basis points at present leverage and extended the maturity date from Oct. 29, 2009, to Aug. 30, 2012. The amendment also reduced the commitment fee from 37.5 basis points to 30.0 basis points. At Dec. 31, 2007, the company's balance sheet showed total assets of US$1.95 billion, total liabilities of US$1.15 billion and total stockholders' equity of US$0.80 billion. Internal Control Over Financial Reporting The company concluded that its internal control over financial reporting as of Dec. 31, 2007, was effective. "Eliminating all of the disclosed material weaknesses is a great milestone for the company and reflects the hard work and excellent team effort of many of our employees across the entire worldwide organization," Lonnie A. Arnett, vice president, controller and chief accounting officer of Dresser-Rand, said. About Dresser-Rand Group Headquartered in Houston, Texas, Dresser-Rand Group Inc. (NYSE: DRC) -- http://www.dresser-rand.com/-- supplies rotating equipment solutions to the worldwide oil, gas, petrochemical, and process industries. The company operates manufacturing facilities in the United States, France, Germany, Norway, India, and Brazil, and maintains a network of 26 service and support centers covering more than 140 countries. * * * Moody's Investor Service placed Dresser-Rand Group Inc.'s probability of default rating at 'Ba3' in September 2006. The rating still holds to date with a stable outlook. ENERGIAS DO BRASIL: 2007 Net Income Rises 11.6% to BRL439.8MM ------------------------------------------------------------- Energias do Brasil S.A. reported its results for the fiscal year 2007. The information is presented on a consolidated basis in accordance with Brazilian Corporate Law and is based on reviewed financial information. The independent auditors did not review the operating information. Amounts are expressed in thousands of Brazilian Reais, except where otherwise stated. -- Energy volumes distributed in 2007 totaled 25,029 GWh, 4.5% more than recorded in 2006. Volumes were boosted by a growth in demand from residential and commercial customers, notably in Bandeirante's and Escelsa's concession areas and from rural customers in the regions served by Escelsa and Enersul. -- Enertrade's volumes grew 7.2% in 2007 when compared to 2006, totaling 7,188 GWh, driven by a growth of 16.8% in the volume of sales to free consumers. -- The volume of energy sold in 2007 was 5,568 GWh, a 17% hike over the same quarter in 2006, largely reflecting the additional energy from the Peixe Angical Hydroelectric Power Plant, the 4th generating unit at the Mascarenhas Hydroelectric Power Plant and from the Sao Joao Small Hydroelectric Plant. -- Net operating revenue in 2007 was BRL4,513.5 million, 13.3% when compared to the previous year. This performance resulted mainly from the increase in installed generation capacity and the growth in distributed energy volume. Net Operating Revenue was adversely affected in BRL183.1 million following Aneel's decision to reduce Enersul's RAB. -- In April, the start-up of Sao Joao Small Hydroelectric Plant added 25 MW to the group's installed capacity. Additionally in 2007, Energias do Brasil sold 615 MW of energy to be generated by the Pecem TPP and 11.7 average MW from repowering projects. Finally, the Santa Fe Small Hydroelectric Plant, a 29 MW plant, started to be built. Therefore, in 2012, after the start-up of the Pecem TPP, the group's installed capacity will have increased by 39%. -- EBITDA for 2007 reached BRL1,123 million, a yoy increase of 4.6%. It is important to highlight the 62.1% growth in generation EBITDA, which reached BRL442 million. -- Net income amounted BRL439.8 million, an 11.6% growth over 2006 earnings. -- Capital expenditures amounted to BRL665.2 million in 2007, a reduction of 19.9% when compared to 2006, mainly a reflection of the conclusion of Peixe Angical Hydroelectric Power Plant. -- On Dec. 4 2007, Aneel decided to reduce Enersul's RAB as related to the 2003 tariff review. The net RAB was reduced in BRL126 million and the gross RAB, in BRL265 million. -- On Dec. 18 2007, the Board of Directors approved: (i) the payment of interest on shareholders' equity of BRL119.9 million or BRL0.730546 per share with respect to fiscal year 2007 and (ii) a share buyback program. Additionally, on March 5 2008, the Board approved an additional dividend of BRL87.3 million or BRL0.545028 per share, with respect to fiscal year 2007. -- On Jan. 8 2008, the Board of Directors approved the restructuring of the Board of Executive Officers. The new executive board proposed to the Board of Directors the increase in the minimum payout to 50%. Energias do Brasil S.A. is an integrated utility group controlled by Energias de Portugal, with activities in generation, distribution and commercialization of electricity. Its power distribution subsdiaries Bandeirante, Escelsa and Enersul represent altogether some 64% of consolidated total assets, while the power generation assets represent some 31%. * * * In May 2007, Moody's Investors Service placed a Ba2 long-term corporate family rating on Energias do Brasil. GENERAL MOTORS: Offers Additional Exit Financing to Delphi Corp. ---------------------------------------------------------------- Delphi Corp. is taking the steps necessary to enable the completion of its exit financing syndication. Delphi said that it has been advised by General Motors Corp. that GM is prepared to provide additional exit financing. The company's US$6.1 billion exit financing package is now expected to include a US$1.6 billion asset-backed revolving credit facility, at least US$1.7 billion of first-lien term loan, an up to US$2.0 billion first-lien term note to be issued to GM (junior to the US$1.7 billion first-lien term loan), and an US$825 million second-lien term loan, of which any unsold portion would be issued to GM. Delphi believes that GM's increased participation in the exit financing structure is necessary to successfully syndicate its exit financing on a timely basis and is consistent with its First Amended Joint Plan of Reorganization and the investment agreement with its plan investors. However, certain of Delphi's plan investors have advised the company they believe the proposed exit financing with increased GM participation would not comply with conditions in the company's investment agreement between Delphi and the plan investors. To clarify that GM's increased participation complies with the Plan and the investment agreement, and to require each of the Plan Investors to perform their obligations under the investment agreement, Delphi asks the U.S. Bankruptcy Court for the Southern District of New York seeking limited relief from the Court under section 1142 of the Bankruptcy Code with respect to the Plan, which was confirmed by the Court on Jan. 25, 2008. Under Section 1142 of the Bankruptcy Code, bankruptcy courts may direct the debtor and any other necessary party to perform any act that is necessary for the consummation of a plan that has been confirmed by the Bankruptcy Court. Delphi's lead plan investor has also agreed to extend from March 31, 2008 to Apr. 5, 2008 the first date by which it could terminate the investment agreement with Delphi if the effective date of the Plan has not occurred, which would provide Delphi additional time to comply with closing conditions under the investment agreement. About Delphi Corp. 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) About GM 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 Feb. 28, 2008, Fitch Ratings affirmed the Issuer Default Rating of General Motors at 'B', with a Rating Outlook Negative. As reported in the Troubled Company Reporter 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 US$39 billion for the third quarter of 2007 related to establishing a valuation allowance against its deferred tax assets in the US, Canada and Germany. As reported in the Troubled Company Reporter 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. S&P said the outlook is stable. GENERAL MOTORS: American Axle Strike Affects More GM Plants ----------------------------------------------------------- General Motors Corp. anticipates to shut down a transmission plant in Toledo, Ohio, a metal casting plant in Saginaw, Michigan, and a DMAX plant in Moraine, Ohio, on Monday, March 10, 2008, as United Auto Workers union workers of key supplier American Axle & Manufacturing Inc. continue their labor strike, according to GM's production statement. An assembly plant in Janesville, Wisconsin will continue production but on shortened shifts next week. If the strike lasts beyond next week, other alternative work schedules will be evaluated. Roughly 680 hourly and 170 salaried workers at the Saginaw plant will be affected, while 1,008 hourly and 187 salaried employees at the DMAX plant will be displaced. About 2,246 hourly and 193 salaried workers of the Janesville plant will be affected with the shortened shifts. As reported in the Troubled Company Reporter on March 5, 2008, the Toledo Transmission plant is expecting 1,444 hourly and 219 salaried workers to be laid off. As previously disclosed UAW president Ron Gettelfinger and Vice President James Settles disclosed that members at American Axle began an unfair labor practices strike at 12:01 a.m. on Feb. 26, 2008, following expiration of a four-year master labor agreement. Lay-off numbers will vary on a day-to-day basis, as some employees will be needed at work for training, maintenance and other activities. The figures of employees displaced is for employees at manufacturing operations only, excluding Service Parts and Operations and other automotive (non-manufacturing) sites. 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 Feb. 28, 2008, Fitch Ratings affirmed the Issuer Default Rating of General Motors at 'B', with a Rating Outlook Negative. As reported in the Troubled Company Reporter 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 US$39 billion for the third quarter of 2007 related to establishing a valuation allowance against its deferred tax assets in the US, Canada and Germany. As reported in the Troubled Company Reporter 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. S&P said the outlook is stable. GERDAU SA: Has Most Expertise in Acquisitions, Analyst Says ----------------------------------------------------------- Gerdau SA has the most expertise when it comes to acquisitions among local steel makers, Business News Americas reports, citing Brokerage Socopa Corretora's analysis department head Daniel Lemos. Mr. Lemos told BNamericas that Gerdau would continue to beat its competitors in terms of acquisitions. BNamericas relates that Gerdau carried out over 10 acquisitions last year, including the purchase of US firm Chaparral Steel for US$4.22 billion, which PricewaterhouseCoopers considered as the biggest takeover transaction by a Brazilian company in 2007. Gerdau is in more markets compared to its competitors, "which facilitates even more this consolidation movement," Mr. Lemos 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. HEXION SPECIALTY: Discloses Post-Merger Senior Officers ------------------------------------------------------- Hexion Specialty Chemicals Inc. disclosed the post-merger senior leaders for the company, contingent on the close of its acquisition of Huntsman Corporation. The transaction is expected to close during the second quarter of 2008, pending receipt of regulatory approvals and the satisfaction of other closing conditions. Once the merger transaction is completed: -- Peter R. Huntsman, President and CEO of Huntsman Corporation, will become Chairman of the Board for the combined company; -- Craig O. Morrison, Chairman, CEO and President of Hexion Specialty Chemicals, will become President and Chief Executive Officer; -- Donald J. Stanutz, Division President, Performance Products, of Huntsman Corporation, will become Chief Operating Officer; -- William H. Carter, Executive Vice President and CFO for Hexion, will assume that role in the new company. "We are pleased to have a talented and highly experienced team of chemical industry executives in place to build an industry- leading enterprise, once the transaction is completed," said Joshua J. Harris, founding partner with Apollo Management L.P. "This combination will form one of the world�s largest specialty chemical companies. It will have annual sales of more than $14 billion, and more than 21,000 associates and 180 facilities around the world serving a diverse range of customers and industries with leading technologies and products." Mr. Huntsman has served in his current role with Huntsman Corporation since July 2000 and previously served as President and Chief Operating Officer since 1994. In 1987, he joined Huntsman Polypropylene Corporation as Vice President before serving as Senior Vice President and General Manager. He has also served as President of Olympus Oil, as Senior Vice President of Huntsman Chemical Corporation and as a Senior Vice President of Huntsman Packaging Corporation, a former subsidiary of the company. Mr. Morrison joined Borden Chemical, Inc., a predecessor company of Hexion Specialty Chemicals, in March 2002 as President and CEO. He was named Chairman in 2005. Prior to joining Hexion, he served as President and General Manager of Alcan Pharmaceutical and Cosmetic Packaging, a division of Alcan, Inc., and as President and General Manager of Van Leer Containers, Inc. He also served as a management consultant with Bain & Company, and worked in a variety of management roles within GE Plastics. Mr. Stanutz has served in his current role as Division President, Performance Products since 2004. He also has served the Huntsman organization as Executive Vice President and Chief Operating Officer of Huntsman LLC, as Executive Vice President, Global Sales and Marketing, and as Executive Vice President, Polyurethanes, PO and Performance Chemicals. Prior to joining Huntsman in 1994, Mr. Stanutz served in a variety of senior positions with Texaco Chemical Company. Mr. Carter has served as Executive Vice President and Chief Financial Officer of Hexion Specialty Chemicals, Inc., and its predecessors, Borden Chemical, Inc., and Borden, Inc., since 1995. Prior to joining Hexion, he served as the Price Waterhouse engagement partner for Borden. He previously served Price Waterhouse in various client assignments in manufacturing, real estate and financial services. About Hexion Specialty Based in Columbus, Ohio, Hexion Specialty Chemicals Inc. -- http://www.hexion.com/-- serves the global wood and industrial markets through a broad range of thermoset technologies, specialty products and technical support for customers in a diverse range of applications and industries. Hexion Specialty Chemicals is owned by an affiliate of Apollo Management, L.P. The company has locations in Singapore, China, Australia, Netherlands, and Brazil. It is an Apollo Management L.P. portfolio company. Hexion had 2006 sales of US$5.2 billion and employs more than 7,000 associates. * * * As reported in the Troubled Company Reporter on July 9, 2007, Standard & Poor's Ratings Services placed its 'B' corporate credit rating and other ratings on Columbus, Ohio-based Hexion Specialty Chemicals Inc. on CreditWatch with negative implications. The ratings on related entities were also placed on CreditWatch. JBS SA: Major Acquisition Spurs Moody's to Continue Review ---------------------------------------------------------- Moody's Investors Service's ratings for JBS S.A., including its B1 local currency corporate family rating and B1 senior unsecured bond rating, will remain under review for possible downgrade following the company's announced agreement to acquire National Beef Packing Company, LLC; Smithfield Beef Group Inc., including full ownership of its subsidiary, Five Rivers Ranch Cattle Feeding; and Tasman Group for a total consideration of approximately US$1.8 billion. The closing of all transactions are subject to regulatory approvals. "If the transactions receive regulatory approval, JBS will become the largest beef processor in the United States and further consolidate its position as the largest beef processor globally with improved size, scale and geographic and product diversification", said Moody's analyst Soummo Mukherjee. At the same time, Moody's highlights the integration and execution challenges that JBS will face because of its recent flurry of acquisitions, including ten acquisitions since 2007. "Moody's will particularly focus its review on the ability of JBS to turn around its troubled US beef operations in an operating environment that may continue to present cost pressures and weaker demand," added Mr. Mukherjee. In order to finance the acquisitions, the company will raise approximately BRL2.55 billion (US$1.5 billion) in shares through a private placement at an issuance price of BRL7.07 per share and pay for the remainder with company's own cash. Moody's also notes that JBS recently refinanced the US$750 million in short-term maturities at Swift & Company for a period of three to five years with three local banks, thus alleviating immediate liquidity concerns. The review for possible downgrade will continue to focus on whether JBS's growth and acquisition strategy will be compatible with a credit profile that is commensurate with its current B1 rating. More specifically, the review will consider the company's operational strategy for the United States market, especially related to beef operations, as well as examine all of the company's operational and business segments on a projected basis and compare expected credit metrics with those of rated global and domestic industry peers. About National Beef Packing Headquartered in Kansas City, Missouri, National Beef Packing Co., is a processor of fresh beef products. The company also provides refrigerated transportation services. Revenues for the twelve months ended Nov. 24, 2007, were approximately US$5.7 billion. About Smithfield Beef Headquartered in Smithfield Virginia, Smithfield Beef Group, Inc. -- http://www.smithfieldbeefgroup.com/Home.html-- is the fifth largest U.S. beef processor. Sales for the twelve months ended Oct. 31,2007, were approximately US$2.8 billion. About Tasman Group Headquartered in Brooklyn, Australia, Tasman Group is one of Australia's largest meat processors with net revenues of approximately US$465 million and processing approximately 2.7 million heads of cattle and small stocks per annum. About JBS Headquartered in Sao Paulo, Brazil, JBS SA -- http://www.jbs.com.br/ir/-- is a public company with its shares listed on Bovespa's Novo Mercado under the symbol JBSS3. The company operates 23 plants in Brazil and six plants in Argentina in addition to its operations in Australia and the United States resulting from last year's purchase of Swift & Company. In the 12 months ending September 2007, JBS generated pro forma net revenue of US$11.9 billion and processed nine million head of cattle. MERCANTIL DO BRASIL: Earns BRL36.7 Million in 2007 -------------------------------------------------- Banco Mercantil do Brasil increased net profits by 86% to BRL36.7 million in 2007, compared to 2006. Business News Americas relates that Mercantil do Brasil's lending grew 33.9% to BRL3.72 billion in 2007, compared to 2006, with retail loans increasing 59%. Mercantil do Brasil's vehicle financing rose 87% in 2007, from 2006, and payroll and retirement loans increased 63%, the report says. According to BNamericas, Mercantil do Brasil's time deposits, its primary source of funding, increased 15.4% to BRL2.42 billion in 2007, compared to 2006. Mercantil do Brasil increased external debt issues by 117% to BRL830 million in 2007, from 2006, BNamericas notes. Mercantil do Brasil's assets increased 30% to BRL7.25 billion in 2007, compared to 2006, BNamericas states. Banco Mercantil do Brasil is headquartered in Belo Horizonte, Brazil and had BRL5.6 billion (US$2.6 billion) in total assets and BRL567 million (US$269 million) in shareholders' equity as of December 2006. * * * As reported in the Troubled Company Reporter-Latin America on Nov. 2, 2007, Standard & Poor's Ratings Services assigned its 'B' long-term senior unsecured debt rating to Banco Mercantil Do Brasil S.A.'s US$100 million senior unsecured MTNs with final maturity in November 2010. NATIONAL BEEF: JBS Buyout Cues Moody's to Change Outlook to Neg. ---------------------------------------------------------------- Moody's Investors Service affirmed the ratings of National Beef Packing Company LLC, including the company's B2 corporate family rating and B2 probability of default rating. The rating outlook was changed to negative from stable. Ratings affirmed: -- Corporate family rating at B2 -- Probability of default rating at B2 Rating affirmed, with LGD percentage revised: -- US$160 million 10.50% senior unsecured notes due 2011 at Caa1 (LGD5); LGD percentage to 86% from 87% The change in outlook to negative is based on Moody's concern that National Beef will be challenged to maintain credit metrics that are appropriate for its rating over the near term, given margin pressure as beef costs remain high for processors. Separately, National Beef and the holders of membership interests in the company reported on March 4, that JBS S.A. would acquire the membership interests, subject to regulatory and other approvals. The rated debt of National Beef will have to be refinanced or amended upon the change of control. The rating of JBS and the position of the rated debt, if it remains outstanding, in JBS' capital structure, will determine the post- acquisition ratings. The company's B2 corporate family rating is supported by National Beef's moderate scale, solid volume growth and lower earnings volatility relative to other processors. However, these attributes are offset by the speculative grade elements in the company's profile, primarily anemic credit metrics, narrow product focus, and the concentration of its raw material sources. Moody's also views its capital structure as weak, given the ability of two shareholder groups to put back their capital to the company at any time beginning in August 2008, which could result in either a leveraged recapitalization or an outright sale of the company. About National Beef Packing Headquartered in Kansas City, Missouri, National Beef Packing Co., is a processor of fresh beef products. The company also provides refrigerated transportation services. Revenues for the twelve months ended Nov. 24, 2007, were approximately US$5.7 billion. The company is majority owned and controlled by U.S. Premium Beef, LLC. JBS S.A. recently signed agreement to acquire National to acquired National Beef Packing Company, LLC; Smithfield Beef Group Inc., including full ownership of its subsidiary, Five Rivers Ranch Cattle Feeding; and Tasman Group for a total consideration of approximately US$1.8 billion. SMITHFIELD FOODS: Asset Sale Prompts Moody's to Hold Ba2 Ratings ---------------------------------------------------------------- Moody's Investors Service affirmed the long-term ratings of Smithfield Foods, Inc., including the company's Ba2 corporate family rating and Ba2 probability of default rating, following the company's announcement that it will sell its beef processing and cattle feeding operation to JBS S.A. for US$565 million in cash. The company's speculative grade liquidity rating of SGL-3 was also affirmed. The rating outlook remains negative. Ratings affirmed: -- Corporate family rating at Ba2 -- Probability of default rating at Ba2 -- Speculative Grade Liquidity Rating at SGL-3 Ratings affirmed, with LGD percentage changed: -- Senior unsecured debt at Ba3 (LGD5). LGD percentage to 84% from 82% The affirmation of the company's long term ratings is based on the expectation that material portion of proceeds from the transaction will be applied to debt reduction. In addition to the initial proceeds of US$565 million, live cattle owned by Smithfield Foods and its Five Rivers joint venture are excluded from the transaction. Proceeds to the company from the liquidation of cattle over the next 12 months are likely to exceed US$200 million, after payment of joint venture debt. In total, cash proceeds could exceed US$750 million. This inflow and the related debt reduction will improve the company's liquidity, and should strengthen credit ratios. Moody's will monitor the timeliness of payments and the receipt of regulatory and other approvals, if any, for the transaction. The continued negative outlook reflects Moody's expectation that credit metrics could remain weak for the rating level, given margin pressure on the company's hog production business. The company's Ba2 corporate family rating reflects the company's high leverage, somewhat volatile earnings and cash flow stream, aggressive historical acquisition strategy, and complex and changing business structure. Smithfield's ratings are supported by the company's large size, very strong market position, geographic and product diversity, and solid brand in the United States pork industry. The company's speculative grade liquidity rating of SGL-3 is affirmed, based on Moody's expectation that its liquidity will remain adequate. Moody's assumes that the sale of the beef business will proceed without significant delay or opposition. The SGL reflects the company's reliance on its external sources of cash in order to cover some cash demands such as capital expenditures, working capital requirements and scheduled debt maturities. Smithfield Foods recently increased the size of its domestic revolving credit by US$75 million and obtained US$200 million in uncommitted short term credit lines. The US$1.275 billion domestic revolving credit expires in August 2010, and a EUR300 million revolving credit expires in August 2009. Headroom under financial covenants has historically been limited due to weak operating performance in the recent past. International assets are generally unencumbered, and the company's bank facility permits the establishment of an accounts receivable facility for up to 5% of total assets. About Smithfield Beef Headquartered in Smithfield Virginia, Smithfield Foods, Inc. -- http://www.smithfieldfoods.com/-- is the world's largest pork producer and processor and the fifth largest U.S. beef processor. Sales for the twelve months ended Jan. 27, 2008, were approximately US$13.67 billion. JBS S.A. recently signed agreement to acquire National to acquired National Beef Packing Company, LLC; Smithfield Beef Group Inc., including full ownership of its subsidiary, Five Rivers Ranch Cattle Feeding; and Tasman Group for a total consideration of approximately US$1.8 billion. USINAS SIDERURGICA: Concludes BRL500 Million Debenture Issuance --------------------------------------------------------------- Usinas Siderurgicas de Minas Gerais SA aka Usiminas has concluded the issuance of BRL500 million in non-convertible five-year debentures. According to Business News Americas, the debentures were priced at BRL100,000 each. The issuance was approved during a shareholders meeting in December 2007, BNamericas states. Headquartered in Minas Gerais, Brazil, Usinas Siderurgicas de Minas Gerais SA is among the world's 20 largest steel manufacturing complexes, with a production capacity of approximately 10 million tons of steel. Usiminas System companies produces galvanized and non-coated flat steel products for the automotive, small and large diameter pipe, civil construction, hydro-electronic, rerolling, agriculture, and road machinery industries. Brazil consumes 80% of its products and the company's largest export markets are the US and Latin America. The company also sells in China and Japan. * * * As reported in the Troubled Company Reporter-Latin America on Feb. 5, 2008, Moody's Investors Service assigned a Ba1 local currency rating and an Aa1.br rating on its Brazilian national scale to the BRL500 million non-guaranteed subordinated debentures due 2013 to be issued by Usinas Siderurgicas de Minas Gerais S.A. (aka Usiminas). Net proceeds from the debentures issuance will be used to partially fund the company's capex program. The rating outlook is stable. As reported in the Troubled Company Reporter-Latin America on Jan. 3, 2007, Standard & Poor's Ratings Services revised its outlook on Brazil-based steelmaker Usinas Siderurgicas de Minas Gerais S.A., aka Usiminas, to positive from stable. Standard & Poor's also it affirmed its 'BB+' local and foreign currency corporate credit ratings on Usiminas. * BRAZIL: Moody's Eyes Solid Growth for Homebuilding Industry ------------------------------------------------------------- The homebuilding industry in Brazil should see solid growth over the next several years, says Moody's Investors Service in a new report. "The combination of structural changes, favorable demographics, and pent-up demand for homes bodes well for activity in the homebuilding industry over the next few years," says Moody's analyst for the homebuilding sector, Soummo Mukherjee. "The government's drive to ease regulation on many fronts amid an improvement in the macro-economic environment and a large housing deficit has led to increased availability of mortgage financing for home buyers." "We are also increasingly seeing banks and homebuilders working together to improve the availability of financing for homebuyers," says Mr. Mukherjee. The solid growth depends, however, on continued economic expansion in Brazil, stable or lower interest rates, and homebuyers continuing to have increasing access to mortgages. Current market conditions may also strain the liquidity and credit quality of some of the homebuilders as they find it difficult to raise the additional capital to satisfy their high financing needs. Moody's explains that for a long period high inflation and elevated interest rates stifled the Brazilian homebuilding industry as mortgage financing remained limited. In addition to the improved economic environment, various regulatory reforms since 2005 have led to its current growth. The reforms included changes in foreclosure law, several tax incentives, and an increase in the funds available for real estate financing. Moody's notes that the Brazilian homebuilding market remains extremely fragmented, with no builder holding more than 8% of the total market. Given homebuilders' high financing needs, the difficult environment for raising capital, and the advantages of scale in this business, Moody's expects to see a number of mergers and acquisitions in the sector over the next few years. ========================== C A Y M A N I S L A N D S ========================== ATLANTIS YACHTING: Proofs of Claim Filing Is Until March 17 ----------------------------------------------------------- Atlantis Yachting Ltd.'s creditors have until March 17, 2008, to prove their claims to North County Holdings Inc., 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. Atlantis Yachting's shareholders agreed on Jan. 16, 2008, to place the company into voluntary liquidation under The Companies Law (2004 Revision) of the Cayman Islands. The liquidator can be reached at: North County Holdings Inc. 4500 PGA Blvd. Suite 207 Palm Beach Gardens, Florida 33418, USA GUIMARAES DE MELLO: Final Shareholders' Meeting Is on March 16 -------------------------------------------------------------- Guimaraes de Mello Europe Ltd. will hold its final shareholders' meeting on March 16, 2008, at 10:30 a.m. in Lisbon, Portugal. These matters will be taken up during the meeting: 1) accounting of the winding-up process; and 2) authorizing the liquidator to retain the records of the co