/raid1/www/Hosts/bankrupt/TCRLA_Public/080430.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
L A T I N A M E R I C A
Wednesday, April 30, 2008, Vol. 9, No. 85
Headlines
A R G E N T I N A
EMPRESA DE TRANSPORTE: Trustee to Verify Claims Until May 22
GOMERIA LA BOUTIQUE: Proofs of Claim Verification Ends on July 7
PROYECTOS AUSTRALES: Trustee to Verify Claims Until Aug. 12
PUBLICIDAD ENRIQUE: Files for Reorganization in Court
PUBLICIDAD SILVETTI: Files for Reorganization in Court
RED HAT: Sees Growth in Brazil in Fiscal Year 2008 Ended Feb. 29
SEVITAR SACIF: Files for Reorganization in Buenos Aires Court
SZWARCBERG HERMANOS: Claims Verification Deadline Is June 11
TALLERES INA: Trustee to File Individual Reports on Aug. 13
TELECOM ARGENTINA: Carlos Felices Resigns as President
TRIOLA SRL: Trustee to File Individual Reports on Aug. 29
TYSON FOODS: Incurs US$5 Million Net Loss in 2008 Second Quarter
* ARGENTINA: S&P's Outlook Change Won't Immediately Affect Firms
B E R M U D A
TYCO: Gets Required Consents on Bondholder Litigation Settlement
YRC WORLDWIDE: Posts US$45.8 Million Net Loss in First Quarter
YRC WORLDWIDE: Refinancing Risks Cue S&P to Confirm 'BB' Rating
B O L I V I A
COEUR D'ALENE: To Complete Palmarejo Project Feasibility Study
B R A Z I L
BANCO BRADESCO: Net Income Up 23.3% to BRL2.1 Billion in 1Q 2008
BANCO BRADESCO: Units Earn BRL746 Million in First Quarter 2008
BANCO BRADESCO: Forms Unit to Handle Credit Card Operations
BANCO BRADESCO: Won't Enter Commercial Banking Segment Abroad
BANCO NACIONAL: Supports Merger in Telecommunication Sector
BANCO NACIONAL: To Provide Funding to Madeira Project Winner
BETA SECURITIZADORA: Moody's Raises Global Scale Rating to Ba1
BLOCKBUSTER INC: Circuit Stockholder HBK Supports Merger Talks
BLOUNT INT'L: Dec. 31 Balance Sheet Upside-Down by US$54 Million
BRASKEM SA: May Sell US$500 Million Bonds Next Week
COMMSCOPE INC: Cost Reduction Prompts Shutdown of Brazilian Fab
GOL LINHAS: Board Approves First Quarter 2008 Dividends Payment
HEXCEL CORP: Moody's Keeps Ba3 Corporate Family Rating
PROPEX INC: Wants to Extend Exclusive Plan-Filing to Oct. 18
PROPEX: Wants Court to Extend Lease Decision Period to Aug. 15
SADIA SA: To Form Joint Venture With Kraft Foods
TELEMAR NORTE: S&P Affirms BB+ Rating Over Brasil Telecom Merger
TELE NORTE: Will List Preferred Shares in Telemar Norte on NYSE
TELE NORTE: S&P Affirms BB+ Rating Over Brasil Telecom Merger
UNSINAS SIDERURGICAS: Issues First Quarter 2008 Earnings Webcast
C A Y M A N I S L A N D S
BLACK BEAR: Will Hold Final Shareholders Meeting on May 2
BPI DIRECTORS: Will Hold Final Shareholders Meeting on May 2
CLEARWATER CAPITAL: Sets Final Shareholders Meeting for May 2
COUNTER MANAGEMENT: Sets Final Shareholders Meeting for May 2
KINETIC CONCEPTS: Earns US$68 Million in First Quarter 2008
KINETIC CONCEPTS: Moody's Rates Proposed US$1.3BB Loan at Ba1
KINETIC CONCEPTS: 2008 Shareholders' Meeting Scheduled on May 20
KINGSWAY PROPERTY: Sets Final Shareholders Meeting for May 2
KOYAH MICROCAP: Will Hold Final Shareholders Meeting on May 2
MIYAKODORI CAPITAL: To Hold Final Shareholders Meeting on May 2
ML OAK: Sets Final Shareholders Meeting for May 2
PEQUOT INDIA: Sets Final Shareholders Meeting for May 2
SUNDAY SILENCE: Sets Final Shareholders Meeting for May 2
TF CAPITAL: Will Hold Final Shareholders Meeting on May 2
YILONG MEDIA: Proofs of Claim Filing Deadline Is Today
C H I L E
BUCYRUS INT'L: Earns US$41.1 Million in Quarter Ended March 31
C O L O M B I A
BANCOLOMBIA: Board Authorizes VP to Sell COP144 Million Shares
BRIGHTPOINT INC: Subsidiary Acquires Hugh Symons Business
GLOBAL CROSSING: Gets SAP Colombia/Brazil Hosting Certification
C O S T A R I C A
ALCATEL-LUCENT: Says Spectrum & Handsets to Help WiMax in LatAm
SIRVA INC: Files Motion to Modify Plan Without Resolicitation
US AIRWAYS: Sets Executive Incentive Plan Targets for 2008
US AIRWAYS: Reaches Tentative Three-Year Agreement With IAM
US AIRWAYS: Pilots Opt for USAPA as Bargaining Agents
D O M I N I C A N R E P U B L I C
SMURFIT KAPPA: S&P Lifts Rating on Improved Operations to BB
J A M A I C A
NATIONAL WATER: Consumers Must Pay 28% More for Water
M E X I C O
AMERICAN AXLE: Posts US$27 Million Net Loss in 1Q 2008
CLEAR CHANNEL: Set to Release 1st Quarter 2008 Results on May 9
CLEAR CHANNEL: Further Extends Offers' Expiration Date to May 2
EMPRESAS ICA: Ties Up With Alstom & Carson for Project Bid
FRONTIER AIRLINES: Trustee Appoints Seven-Member Creditors Panel
GRUPO CASA: Net Income Up 13% to MXN191.61MM in 1st Quarter 2008
GRUPO TMM: Posts US$10.3 Mil. Net Loss in Quarter Ended March 31
INGRAM MICRO: Unveils Global Restructuring Plan, 1Q '08 Results
SHARPER IMAGE: Allowed to Employ Weil, Gotshal as Attorney
SHARPER IMAGE: Committee Wants to Retain Cooley as Lead Counsel
SHARPER IMAGE: Committee Wants to Retain Loughlin as Advisor
SHARPER IMAGE: Committee Wants to Retain Whiteford as Counsel
THERMADYNE HOLDINGS: Earns US$4 Million in Quarter Ended Dec. 31
U.S. STEEL: R. Beltz Named as North-Am Flat-Rolled Marketing GM
VITRO SAB: Books US$30MM Consolidated Net Income in 1Q 2008
VITRO SAB: Fitch Holds B Foreign & Local Issuer Default Ratings
P A N A M A
TITAN PETROCHEMICAL: S&P Cuts Rating to B on Weak Performance
P E R U
GLOBAL CROSSING: Launches VSAT Satellite Platform in Peru
P U E R T O R I C O
CELESTICA INC: S&P Changes Outlook to Stable; Holds 'B+' Ratings
DELPHI CORP: Ch. 11 Exit to be Delayed for Months, GM Chief Says
DELPHI CORP: To Seek US$4.1B Loan Refinancing, Adjusts Forecasts
DELPHI CORP: Wants to Obtain US$650 Million Credit from GM
DIRECTV GROUP: Launches Prepaid Television Service in Chile
FORD MOTOR: Shareholder Tracinda Offers to Buy 20MM Ford Stake
FORD MOTOR: Inks Master Economics Offer Agreement with CAW
MICRON TECHNOLOGY: S&P Holds 'BB-' Rating on Ample Liquidity
U R U G U A Y
COOPERATIVA DE AHORRO: Fitch Revises Stable Outlook to Positive
FEDERACION URUGUAYA: Fitch Affirms Issuer Default Ratings at B
HSBC BANK (URUGUAY): Solid Structure Cues Fitch to Hold BB+ Rtg.
V E N E Z U E L A
GOODYEAR TIRE: Earns US$147 Million in 2008 First Quarter
PETROLEOS DE VENEZUELA: Not Transparent, Report States
- - - - -
=================
A R G E N T I N A
=================
EMPRESA DE TRANSPORTE: Trustee to Verify Claims Until May 22
------------------------------------------------------------
Wexler, Ramos y Cia. -- the court-appointed trustee for Empresa
de Transporte Automotor Cruz Alta S.R.L.'s reorganization
proceeding -- will be verifying creditors' proofs of claim until
May 22, 2008.
Wexler, Ramos, will present the validated claims in court as
individual reports on July 8, 2008. The National Commercial
Court of First Instance in San Miguel de Tucuman, Tucuman, 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 Empresa de Transporte and its creditors.
Inadmissible claims may be subject for appeal in a separate
proceeding known as an appeal for reversal.
A general report that contains an audit of Empresa de
Transporte's accounting and banking records will be submitted in
court on Aug. 14, 2008.
Creditors will vote to ratify the completed settlement plan
during the assembly on Feb. 25, 2009.
The debtor can be reached at:
Empresa de Transporte Automotor Cruz Alta S.R.L.
Avenida Brigido Teran 250, San Miguel de Tucuman
Tucuman, Argentina
The trustee can be reached at:
Wexler, Ramos y Cia.
24 de Septiembre 754, San Miguel de Tucuman
Tucuman, Argentina
GOMERIA LA BOUTIQUE: Proofs of Claim Verification Ends on July 7
----------------------------------------------------------------
Mauricio Leon Brauer, the court-appointed trustee for Gomeria La
Boutique SA's bankruptcy proceeding, will be verifying
creditors' proofs of claim until July 7, 2008.
Mr. Brauer will present the validated claims in court as
individual reports. The National Commercial Court of First
Instance No. 1 in Buenos Aires, with the assistance of Clerk
No. 2, 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 Gomeria La 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 Gomeria La Boutique's
accounting and banking records will be submitted in court.
La Nacion didn't state the submission dates of the reports.
Mr. Brauer is also in charge of administering Gomeria La
Boutique's assets under court supervision and will take part in
their disposal to the extent established by law.
The debtor can be reached at:
Gomeria La Boutique SA
Maipu 4001
Buenos Aires, Argentina
The trustee can be reached at:
Mauricio Leon Brauer
Sarmiento 2593
Buenos Aires, Argentina
PROYECTOS AUSTRALES: Trustee to Verify Claims Until Aug. 12
-----------------------------------------------------------
Susana Achelli, the court-appointed trustee for Proyectos
Australes SRL's reorganization proceeding, will be verifying
creditors' proofs of claim until Aug. 12, 2008.
Ms. Achelli will present the validated claims in court as
individual reports. The National Commercial Court of First
Instance No. 24 in Buenos Aires, with the assistance of Clerk
No. 48, 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 Proyectos Australes 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 Proyectos Australes'
accounting and banking records will be submitted in court.
La Nacion didn't state the reports submission deadlines.
Creditors will vote to ratify the completed settlement plan
during the assembly on May 26, 2009.
The debtor can be reached at:
Proyectos Australes SRL
San Martin 1009
Buenos Aires, Argentina
The trustee can be reached at:
Susana Achelli
Montevideo 571
Buenos Aires, Argentina
PUBLICIDAD ENRIQUE: Files for Reorganization in Court
-----------------------------------------------------
Publicidad Enrique C. Silvetti S.A. has requested for
reorganization approval after failing to pay its liabilities.
The reorganization petition, once approved by the court, will
allow Publicidad Enrique 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:
Publicidad Enrique C. Silvetti S.A.
Paraguay 755
Buenos Aires, Argentina
PUBLICIDAD SILVETTI: Files for Reorganization in Court
------------------------------------------------------
Publicidad Silvetti S.A. has requested for reorganization
approval after failing to pay its liabilities.
The reorganization petition, once approved by the court, will
allow Publicidad Silvetti 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.
RED HAT: Sees Growth in Brazil in Fiscal Year 2008 Ended Feb. 29
----------------------------------------------------------------
Red Hat Inc.'s Brazilian unit saw growth in all its business
units, including sales, support, development, and consultancy,
during the fiscal year 2008 that ended on Feb. 29, 2008,
Business News Americas reports.
The growth is due to the increase of local staff, the
penetration of customers' core business, and focus on clients
and partners, BNamericas says, citing Red Hat Brasil.
According to Red Hat, the company was most mentioned as the most
adequate provider of open source solutions in Brazil, with a 46%
share of the servers market and 43% in the overall market, as
indicated in the survey "Investment trends in the use of open
source among Brazilian companies," by the Instituto Sem
Fronteiras. The survey polled 1,000 firms from various
industries of different sizes.
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
April 2, 2008, Standard & Poor's Ratings Services raised its
corporate credit rating on Red Hat Inc. to 'BB-' from 'B+'. S&P
said the outlook is stable.
SEVITAR SACIF: Files for Reorganization in Buenos Aires Court
-------------------------------------------------------------
Sevitar S.A.C.I.F. has requested for reorganization approval
after failing to pay its liabilities.
The reorganization petition, once approved by the court, will
allow Sevitar 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:
Sevitar S.A.C.I.F.
Corrientes 1585
Buenos Aires, Argentina
SZWARCBERG HERMANOS: Claims Verification Deadline Is June 11
------------------------------------------------------------
Susana Raquel Manrique, the court-appointed trustee for
Szwarcberg Hermanos S.A.'s bankruptcy proceeding, will be
verifying creditors' proofs of claim until June 11, 2008.
Ms. Manrique will present the validated claims in court as
individual reports on Aug. 20, 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 Alemani Italo 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 Szwarcberg Hermanos'
accounting and banking records will be submitted in court on
Oct. 1, 2008.
Ms. Manrique is also in charge of administering Szwarcberg
Hermanos' assets under court supervision and will take part in
their disposal to the extent established by law.
The trustee can be reached at:
Susana Raquel Manrique
Lavalle 1675
Buenos Aires, Argentina
TALLERES INA: Trustee to File Individual Reports on Aug. 13
-----------------------------------------------------------
Alicia Mabel Orinov, the court-appointed trustee for Talleres
Ina SACIF's bankruptcy proceeding, will present the validated
claims as individual reports in the National Commercial Court of
First Instance in Buenos Aires on Aug. 13, 2008.
Ms. Orinov will be verifying creditors' proofs of claim until
June 17, 2008. She will submit to court a general report
containing an audit of Talleres Ina's accounting and banking
records on Sept. 25, 2008.
Ms. Orinov is also in charge of administering Talleres Ina's
assets under court supervision and will take part in their
disposal to the extent established by law.
The debtor can be reached at:
Talleres Ina SACIF
Sarmiento 983
Buenos Aires, Argentina
The trustee can be reached at:
Alicia Mabel Orinov
Oliden 3688
Buenos Aires, Argentina
TELECOM ARGENTINA: Carlos Felices Resigns as President
------------------------------------------------------
Argentine news daily Clarin reports that Telecom Argentina SA's
President Carlos Felices has filed his resignation.
According to Business News Americas, Mr. Felices reported said
he could no longer tolerate the "improper instructions" coming
from major shareholder Telecom Italia.
As reported in the Troubled Company Reporter-Latin America on
Oct. 18, 2007, the Argentine government created a two-person
board at Telecom Argentina to check whether Spanish firm
Telefonica's purchase of a stake in Telecom Italia affects
competition and whether the acquisition would lead to Telefonica
having undue influence on the decisions of Telecom Argentina,
which Telecom Italia controls.
A consortium of Italian companies and Telefonica reached an
accord on April 28, 2007, to indirectly acquire a 23.6%
controlling stake in Telecom Italia. Telecom Italia owns 50% of
Sofora, Telecom Argentina's controller. Local investment group
Grupo Werthein, Telecom Argentina's second biggest shareholder,
claimed that Telefonica would eventually have an impact on
Telecom Argentina. Comision Nacional asked Spanish
telecommunications firm Telefonica, Telefonica de Argentina's
parent firm, for additional documentation on its acquisition of
a controlling stake in Telecom Italia.
BNamericas relates that Telecom Italia forced Telecom Argentina
officials to detract from their original statements made to an
Argentine oversight committee. Werthein then filed a suit for
coercion with the penal courts and sent a copy to the antitrust
agency CNDC. The report says Telecom Italia is trying to
convince the CNDC that Telefonica won't influence any decisions
for Telecom Argentina.
The Telecom Argentina board will appoint a new president to take
Mr. Felices' place. The next Telecom Argentina president could
be lawyer Enrique Garrido, who had said that Telefonica's
purchase of Telecom Italia wouldn't affect operations at Telecom
Argentina, Clarin states, citing sources.
Headquartered in Buenos Aires, Telecom Argentina S.A. --
http://www.telecom.com.ar/index-flash.html-- provides
telephone-related services, such as international long-distance
service and data transmission and Internet services, and through
its subsidiaries, wireless telecommunications services,
international wholesale services and telephone directory
publishing. As of Dec. 31, 2006, its telephone system included
approximately 4.09 million lines in service.
As of 2007, current approximate ownership of Telecom Argentina
is: * 54.74% by Nortel Inversora S.A., itself a consortium made
up of: -- Werthein Group (48%) -- Telecom Italia -- France
Telecom group (2%); * 41.5% publicly traded; and * 4.21%
employee stock ownership program France Telecom sold its part of
Telecom Argentina to the WertheinGroup, an Argentine
agricultural concern owned in part by vice chairman Gerardo
Werthein. As of 2007, current approximate ownership of Telecom
Argentina is: * 54.74% by Nortel Inversora S.A., itself a
consortium made up of: -- Werthein Group (48%) -- Telecom Italia
group (50%) -- France Telecom group (2%); * 41.5% publicly
traded; and * 4.21% employee stock ownership program.
* * *
As reported in the Troubled Company Reporter-Latin America on
Feb. 21, 2008, Fitch Ratings upgraded Telecom Argentina's
foreign and local currency issuer default ratings to 'B+' from
'B'. Fitch said the outlook is positive.
TRIOLA SRL: Trustee to File Individual Reports on Aug. 29
---------------------------------------------------------
Ernesto Bermann, the court-appointed trustee for Triola S.R.L.'s
bankruptcy proceeding, will present the validated claims as
individual reports in the National Commercial Court of First
Instance in Buenos Aires on Aug. 29, 2008.
Mr. Bermann will be verifying creditors' proofs of claim until
July 2, 2008. He will submit to court a general report
containing an audit of Triola's accounting and banking records
on Oct. 8, 2008.
Mr. Bermann is also in charge of administering Triola's assets
under court supervision and will take part in their disposal to
the extent established by law.
The debtor can be reached at:
Triola SRL
Triunvirato 4500
Buenos Aires, Argentina
The trustee can be reached at:
Ernesto Bermann
Cordoba 817
Buenos Aires, Argentina
TYSON FOODS: Incurs US$5 Million Net Loss in 2008 Second Quarter
----------------------------------------------------------------
Tyson Foods Inc. posted a net loss of US$5 million for the three
months ended March 29, 2008, compared to net income of
US$68 million for the three months ended March 31, 2007.
The company's second quarter 2008 sales were US$6.6 billion
compared to US$6.5 billion for the same period last year.
Operating income for the second quarter of fiscal 2008 was US$44
million compared to US$158 million for the same quarter of 2007.
"Our second quarter results show the strength of a diversified
protein business model," said Richard L. Bond, president and
chief executive officer of Tyson Foods. "We continue to believe
the second fiscal quarter should be our most challenging, and we
are pleased with our results.
"Our Pork segment did very well, delivering its best January-
March quarter ever," Mr. Bond said. "Our Beef segment improved
$74 million over the first quarter of this fiscal year, or
approximately $100 million excluding plant closing and asset
impairment charges. The Chicken segment suffered losses due to
significantly higher and volatile input costs. Our chicken and
pork exports continue to be strong, and we are moving forward
with our strategy for international expansion.
"Looking forward to the third quarter, the Beef segment should
continue its improvement due to the start of grilling season and
the encouraging news South Korea will resume imports of U.S.
beef next month," Mr. Bond said. "The Pork segment should do
well again, although not as well as the second quarter. In
the Chicken segment, we anticipate an additional $100 million of
increased grain costs over the second quarter, offset in part by
operational improvements, pricing and risk management
activities. For the year, corn and soybean meal increases are
likely to approach $600 million. Including other inputs such as
cooking oil, breading and other feed ingredients, the increase
in costs for the fiscal year may approach $1 billion compared to
fiscal 2007."
Based in Springdale, Arkansas, Tyson Foods, Inc. (NYSE:TSN) --
http://www.tysonfoods.com/-- is a processor and marketer of
chicken, beef, and pork. The company makes a wide variety of
protein-based and prepared food products at its 123 processing
plants. Tyson has approximately 114,000 Team Members employed
at more than 300 facilities and offices in 26 states and 80
countries.
Tyson's U.S. beef plants are located in Amarillo, Texas; Dakota
City, Nebraska; Denison, Iowa; Finney County, Kansas; Joslin,
Illinois, Lexington, Nebraska and Pasco, Washington. The
company also has a beef complex in Canada, and is involved in a
vertically integrated beef operation in Argentina.
* * *
As reported in the Troubled Company Reporter-Latin America on
April 8, 2008, Moody's Investors Service confirmed Tyson Foods,
Inc.'s corporate family rating and probability of default rating
at Ba1. Moody's said the rating outlook remains negative.
* ARGENTINA: S&P's Outlook Change Won't Immediately Affect Firms
----------------------------------------------------------------
Standard & Poor's Ratings Services said that the change in the
outlook on the sovereign rating on the Republic of Argentina (to
negative from stable) will not immediately affect ratings on
Argentine corporate entities.
Argentina corporate ratings have been heavily influenced by
S&P's view of significant risks in the economic and business
environment, which S&P refers to broadly as country risk.
Although S&P perceives that country risk in Argentina has
lessened somewhat in the past year, the rating agency believes
its ratings in the sector already incorporate these
uncertainties. Nevertheless, a continued increase in country
risk could lead us to review ratings in the sector.
Country risk is a broader concept that incorporates all the
factors, including sovereign risk, that influence a company's
ability to meet all of its financial obligations in a timely
manner. In addition to the government's financial and economic
health, country risk includes the country's institutional
environment, the current regulatory framework, the health and
depth of the country's financial system, the availability of
capital (human and physical), the volatility of economic cycles,
the development of financial markets, fiscal and labor laws,
bankruptcy regulations, and the like. All these factors have a
certain level of influence on a private entity's financial
health, and their final weight varies according to each
company's specific circumstances. A country's institutional,
regulatory, and legal frameworks are core issues because they
intrinsically condition long-term development.
The revision of the outlook on the sovereign to negative was
based on S&P's concerns that rising inflation expectations and
distortions in the economy through price controls, subsidies,
and regulation could hurt growth prospects now that Argentina's
output gap has narrowed. ("Outlook On Argentina 'B+' Rtg Revised
To Negative As Econ Minister Resigns On Concerns On Outlook,"
published on April 25, 2008)
The variables that continue to affect S&P's assessment of
country economic and business risk are a weak institutional
environment, a changing regulatory framework, inability to
forecast future business conditions, discredited economic
statistics produced by the government particularly price
indexes, and the potential impact of energy shortages.
=============
B E R M U D A
=============
TYCO: Gets Required Consents on Bondholder Litigation Settlement
-----------------------------------------------------------
Tyco International Ltd. had received, as of 5:00 p.m. New York
time, on April 28, 2008, consents from the holders of a majority
in principal amount of each series of outstanding notes issued
under the company's 1998 and 2003 indentures, in connection with
the previously announced consent solicitations for such notes.
As a result of the receipt of the requisite consents, and based
on the waiver of any alleged defaults or events of default that
may have arisen prior to April 11, 2008 contained therein, the
company intends to promptly take all action necessary to dismiss
the proceeding entitled The Bank of New York vs. Tyco
International Group S.A. pending in the United States District
Court for the Southern District of New York. In addition, the
company will enter into supplemental indentures to effect the
proposed amendments, substantially as described in the consent
solicitation and exchange offer documents dated April 11, 2008,
with the trustee under each indenture. The proposed amendments
include a covenant providing noteholders with the right to
require the company and Tyco International Finance S.A., the co-
obligor of the notes, to repurchase the notes at a fixed price
in the event of certain change of control transactions.
In addition, holders of 96% of 7% notes due 2028 and 97% of
6.875% notes due 2029 issued by the company and Tyco
International Finance SA have validly tendered their notes in
exchange for new notes with maturities in 2019 and 2021,
respectively.
Tyco International expects that the supplemental indentures will
become effective, and that it will pay the consent fees due in
connection with the transaction, promptly following final
dismissal of the bondholder litigation. The exchange offer will
close simultaneously with the consent solicitations.
In accordance with the terms of the Offer Documents, delivered
consents may no longer be revoked and tendered notes may no
longer be withdrawn, unless the exchange offers and the consent
solicitations are terminated in accordance with the Offer
Documents. In addition, the company and Tyco International
Finance are extending the Consent Date for noteholders to submit
their consents. The new consent date is 5:00 p.m. New York City
time, on May 12, 2008, subject to further extensions.
Consent Solicitation Results as of 5:00 p.m. New York time,
April 28, 2008:
Consents Notes Tendered for Exchange
---------------------------------------------------------------
7% notes due 2028 98% 96%
6.875% notes due 2029 98% 97%
6% notes due 2013 98% Not Applicable
6.375% notes due 2011 96% Not Applicable
6.75% notes due 2011 97% Not Applicable
6.125% notes due 2009 95% Not Applicable
6.125% notes due 2008 88% Not Applicable
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.
YRC WORLDWIDE: Posts US$45.8 Million Net Loss in First Quarter
--------------------------------------------------------------
YRC Worldwide Inc. reported a first quarter 2008 loss of
US$45,875,000 on operating revenue of US$2,232,592,000. This
compares to a net income of US$1,279,000 on operating revenue of
US$2,328,342,000 for the three months ended March 31, 2007. The
company also said that the results included the previously
announced reorganization charges related to USF Holland and USF
Reddaway and losses on property disposals. The results also
included unfavorable actuarial adjustments primarily related to
prior-year development of self-insurance claims.
At March 31, 2008, the company had total assets of
US$5,011,025,000 and total debts of US$1,174,510,000.
"The soft economy, severe winter weather and record fuel prices
created a very difficult operating environment in the first
quarter," stated Bill Zollars, Chairman, President and CEO of
YRC Worldwide. "With that said, we have taken a number of
actions that address the areas within our control and we are
seeing benefits from those efforts. Despite the macroeconomic
challenges that we are facing, we believe that we have turned
the corner and expect meaningful earnings improvement starting
with the current quarter," Zollars continued.
Although the practice of providing earnings guidance was
suspended in 2007, due in great part to uncertainty in the
economy, which remains difficult to predict, the company
determined that investors should be provided with additional
near-term clarity regarding the anticipated performance of YRCW.
Based upon the internal actions the company has already
implemented, including securing a more competitive labor
contract, renewing its credit agreement, and making footprint
changes at YRC Regional Transportation, YRCW expects to earn
between US$.30 and US$.40 per share in the second quarter, which
ends June 30, 2008.
"Given our solid action plans and the momentum that is underway,
we are excited about the future of YRC and what we can do for
our customers, employees and investors," stated Zollars.
Segment Information
Key segment information for the first quarter 2008 included:
* YRC National Transportation LTL revenue per hundredweight
up 6.3% from first quarter 2007 and LTL tonnage per day
down 8.9%
* YRC Regional Transportation LTL revenue per hundredweight
up 5.4% compared to last year and LTL tonnage per day down
10.1%
* YRC Logistics revenue and operating income consistent with
last year despite the weak economy
About YRC Worldwide
YRC Worldwide Inc. (Nasdaq: YRCW) -- http://www.yrcw.com/-- is
the holding company for a portfolio of successful brands
including Yellow Transportation, Roadway, Reimer Express, YRC
Logistics, New Penn, USF Holland, USF Reddaway, and USF Glen
Moore. The enterprise provides global transportation services,
transportation management solutions and logistics management.
The portfolio of brands represents a comprehensive array of
services for the shipment of industrial, commercial and retail
goods domestically and internationally. Headquartered in
Overland Park, Kansas, YRC Worldwide employs approximately
60,000 people.
The company has subsidiaries in Bermuda, the United Kingdom,
Netherlands, Singapore, Hong Kong and Mexico.
YRC WORLDWIDE: Refinancing Risks Cue S&P to Confirm 'BB' Rating
---------------------------------------------------------------
Standard & Poor's Ratings Services has affirmed its ratings on
YRC Worldwide Inc., including the 'BB' corporate credit rating,
and removed the ratings from CreditWatch, where they had been
placed with negative implications on Feb. 21, 2008. The outlook
is negative. The ratings had been placed on CreditWatch because
of heightened concerns over the company's refinancing risk,
earnings performance, and liquidity position over the next year,
given the slowing U.S. economy and continuing pressures in the
trucking sector.
"The company has since obtained an amendment to its credit
facility that allows additional covenant relief, and has renewed
its 364-day asset-backed security facility, which was due to
expire on May 16, 2008," said Standard & Poor's credit analyst
Anita Ogbara. YRC has meaningful debt maturities over the next
year and expects to use some combination of free cash flow,
refinancing, and capacity under its amended bank facility to
meet these maturities. "We believe the additional covenant
relief provides sufficient room and expect the company to remain
in compliance with its covenants," the analyst added.
At the same time, Standard & Poor's lowered its issue-level
rating on Yellow Corp.'s unsecured debt to 'B+' from 'BB' (two
notches lower than the corporate credit rating on YRC Worldwide
Inc.). S&P assigned a recovery rating of '6' to this debt,
indicating the expectation for negligible (0-10%) recovery in
the event of a payment default. The issue-level rating on the
now partly secured notes at Roadway LLC is unchanged at 'BB'.
S&P assigned a recovery rating of '4' to this debt, indicating
the expectation for average (30%-50%) recovery.
YRC is the largest less-than-truckload trucking company in North
America, generating US$9.6 billion in annual revenues. YRC
competes with large LTL companies Arkansas Best Corp. (US$1.8
billion in revenue) and Con-Way Inc. (US$4.2 billion in revenue)
and with numerous smaller long-haul and regional LTL companies.
Conditions in the trucking sector have deteriorated over the
past several quarters and will likely not improve materially
over the near term, given the weaker U.S. economy.
YRC has pursued selective acquisitions in the past that have
helped the company gain market share and increase its product
offering. However, these acquisitions have stretched the
company's financial profile, and YRC has not yet rationalized
these acquired LTL operations. To improve profitability, YRC
plans to streamline operations, reduce overhead, and manage
costs more effectively. YRC has formalized plans to improve
financial performance and is targeting US$100 million in cost
savings over the next few quarters through the combination of
terminal rationalization, elimination of redundant activities,
and other cost reductions.
S&P expects YRC's financial results to improve by early 2009 in
response to various operating initiatives and as the freight
environment improves. S&P could lower the ratings if financial
results do not improve and the expected improvement in credit
protection measures fails to materialize or if access to
liquidity becomes constrained. S&P could revise the outlook to
stable if YRC's credit metrics return to expected levels, and
the improvement appears sustainable.
YRC Worldwide Inc. (Nasdaq: YRCW) -- http://www.yrcw.com/-- is
the holding company for a portfolio of successful brands
including Yellow Transportation, Roadway, Reimer Express, YRC
Logistics, New Penn, USF Holland, USF Reddaway, and USF Glen
Moore. The enterprise provides global transportation services,
transportation management solutions and logistics management.
The portfolio of brands represents a comprehensive array of
services for the shipment of industrial, commercial and retail
goods domestically and internationally. Headquartered in
Overland Park, Kansas, YRC Worldwide employs approximately
60,000 people.
The company has subsidiaries in Bermuda, the United Kingdom,
Netherlands, Singapore, Hong Kong and Mexico.
=============
B O L I V I A
=============
COEUR D'ALENE: To Complete Palmarejo Project Feasibility Study
--------------------------------------------------------------
Coeur d'Alene Mines Corp.'s Chief Financial Officer Mitchell
Krebs told Business News Americas that the firm wants to
complete in June a feasibility study for its Palmarejo silver-
gold project in Chihuahua, Mexico.
The study will include the first proven and probable reserves
estimate for the Palmarejo deposit, BNamericas says, citing Ms.
Krebs.
According to BNamericas, "Palmarejo's measured and indicated
resources stand at 88.7 million ounces of silver and one million
ounces of gold, with additional inferred resources of
61.4 million ounces of silver and 700,000 ounces of gold. The
current mine plan foresees a commercial production rate of 4,500
tons per day throughput, with annual output of nearly
10.4 million ounces of silver and 115,000 ounces of gold at cash
costs, net of gold byproduct, of negative US$0.41 per ounce of
silver."
Ms. Krebs told BNamericas that before Coeur d'Alene acquired the
Palmarejo project, processing equipment with a capacity of 6,000
tons per day -- including ball mills and sag mills -- were
bought. "So we will have about 1,500 tons per day of excess
capacity that we will hopefully take up with added production
from the other nearby deposits, like Guadalupe and La Patria.
Hopefully, although not immediately, but in the first couple of
years of production, we can bump production from 4,500 tons per
day up to 6,000 tons per day," Ms. Krebs commented.
The Palmarejo project will be "in commercial production" at
4,500 tons per day by 2009, with about 2,500 tons per day coming
from the open pit and 2,000 tons per day coming from
underground, BNamericas says, citing Ms. Krebs.
"Capital expenditures to get Palmarejo into commercial
production are estimated at US$225 million," Ms. Krebs told
BNamericas.
Coeur d'Alene Mines Corp. (NYSE:CDE) (TSX:CDM) --
http://www.coeur.com/-- is the world's largest primary silver
producer, as well as a significant, low-cost producer of gold.
The company has mining interests in Nevada, Idaho, Alaska,
Argentina, Chile, Bolivia and Australia.
* * *
Coeur d'Alene Mines Corp.'s US$180 Million notes due
Jan. 15, 2024, carry Standard & Poor's Ratings Services B-
rating.
===========
B R A Z I L
===========
BANCO BRADESCO: Net Income Up 23.3% to BRL2.1 Billion in 1Q 2008
----------------------------------------------------------------
Banco Bradesco presented its main figures for the first quarter
of 2008. The Report on Economic and Financial Analysis
containing the complete Financial Statements is available on the
investor relations Web site http://www.bradesco.com.br/ir
Highlights:
-- Net Income in the first quarter 2008 stood at
BRL2.102 billion (up 23.3% in relation to the net income
of BRL1.705 billion in the same quarter of 2007),
corresponding to EPS of BRL0.68 and return of 32% on
Average Shareholders' Equity.
-- Net Income comprised BRL1.356 billion from financial
activities, which accounted for 65% of the total, and
BRL746 million from insurance, private pension plan and
certificated savings plan activities, which accounted for
35% of Net Income.
-- Market capitalization grew by 12.1% compared to first
quarter 2007, reaching BRL93.631 billion in March 2008
(BRL104.959 billion on April 25, 2008).
-- The balance of total assets in March 2008 stood at
BRL355.517 billion, an increase of 26.1% in relation to
March 2007. Annualized return on average total assets was
2.4%, versus 2.5% in the same period of 2007.
-- The total loan portfolio grew to BRL169.408 billion, 38.5%
higher than a year ago. Loans to individuals totaled
BRL62.226 billion (up 34.3%), while operations with
corporate clients totaled BRL107.182 billion (up 41%).
-- The sum of funds raised and managed was BRL506.805
billion, an increase of 24.5% from the BRL406.970 billion
in March 2007.
-- Shareholders' Equity was BRL32.909 billion in the first
quarter of 2008, an increase of 26.4% versus first quarter
2007. The Capital Adequacy Ratio stood at 13.9%.
-- Remuneration to shareholders in the period in the form of
interest on shareholders' capital paid and provisioned
totaled BRL740 million, equivalent to 35.2% of Net Income
of the same quarter.
-- The Efficiency Ratio in 12 months stood at 41.7%, an
improvement compared to the 42.1% in March 2007.
-- In the first quarter 2008, investments in infrastructure,
information technology and telecommunications amounted to
BRL573 million, up 20.6% million in relation to the first
quarter of 2007.
-- Taxes and contributions, including social security, paid
or provisioned in the period, stemming from the main
activities developed by Bradesco Organization, totaled
BRL1.697 billion, equivalent to 80.7% of Net Income.
-- Banco Bradesco has Brazil's largest private customer
service network, with 3,169 branches, 26,735 ATMs in the
Bradesco Dia&Noite (Day&Night) Network, 4,221 ATMs in the
Banco24Horas (24HourBank) Network, 12,381 Bradesco
Expresso outlets, 5,851 Postal Bank branches, 2,825
corporate site branches and 357 branches of Finasa
Promotora de Vendas.
-- On Jan. 21, Grupo Bradesco de Seguros e Previdencia,
through Bradesco Seguros S.A., entered into a "Quotas
Assignment Agreement" with Marsh Corretora de Seguros
Ltda., with a view to acquiring control of Mediservice -
Administradora de Planos de Saude Ltda. The transaction
represents an important strategic step that will allow for
expanding the client base with scale gains.
-- On March 6, Banco Bradesco BBI S.A. entered with the
shareholders of Agora Corretora de Titulos e Valores
Mobiliarios S.A., into a "Private Instrument of Commitment
of Merger of Shares and Other Covenants", aiming at the
acquisition of its total capital. Agora Corretora is
Brazil's largest brokerage firm in online purchase and
sale transactions of shares to individuals (home broker),
with around 29,000 active clients. The operation is
subject to the approval by the respective government
agencies and to the due diligence results.
-- On March 27, Brazil's Central Bank (BACEN) approved: (i)
the increase in the Capital Stock in the amount of BRL1.2
billion, from BRL19 billion to BRL20.2 billion, through
the subscription of new shares introduced at the Special
Shareholders' Meeting held on Jan. 4, 2008, and ratified
at the Special Shareholders' Meeting held on March 24,
2008; and (ii) an increase in the capital stock in the
amount of BRL2,8 billion, from BRL20.2 billion to BRL23
billion, with a 50% stock bonus, through the
capitalization of part of the balance in the "Profit
Reserve - Statutory Reserve" account, as resolved at the
Special Shareholders' Meeting held on March 24, 2008.
-- Banco Bradesco is the Brazilian bank with the best
placement in the ranking of the world's 2,000 largest
companies, ranking 85th, according to Forbes, one of the
most respected international economy, finances and
businesses magazines.
-- Regarding Social Responsibility, for more than 50 years,
Fundacao Bradesco has been dedicated to educating low-
income children, adolescents and adults. Since its
creation, the foundation has provided free and high-
quality education to some 2 million students, with this
figure rising to 2.5 million once the distance-learning
programs are included. With an estimated budget of
BRL220.069 million, this year Fundacao Bradesco will be
able to provide assistance on more than 411,000 occasions
in the many segments in which it operates. Among the
people assisted, 110,415 students will have free high-
quality education.
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 BRADESCO: Units Earn BRL746 Million in First Quarter 2008
---------------------------------------------------------------
Banco Bradesco SA's insurance, private pension, and savings bond
businesses' net profit increased 41.0% to BRL746 million in the
first quarter this year 2008, compared to the same period in
2007, Business News Americas reports.
According to Banco Bradesco, the units' return on equity
increased to 37.8% in the first quarter 2008, compared to 33.0%
in the first quarter 2007, while equity rose 26.2% year-on-year
to BRL9.15 billion.
BNamericas relates that the units' operating income grew 47.7%
to BRL1.07 billion in the first quarter 2008, from the first
quarter 2007. Their financial income rose 9.75% to
BRL698 million.
The report says that claims paid rose 14.8% to BRL1.64 billion
in the first quarter 2008, compared to the same period last
year, and the combined ratio improved to 83.9% from 85.1%.
BNamericas notes that insurance, private pension, and savings
bonds contributed 35% to Banco Bradesco's "bottom line," which
increased 23.3% to BRL2.10 billion in the first quarter 2008,
compared to the same period in 2007.
The insurance divisions accounted for 39% of Banco Bradesco's
recurring net income, which rose 11.8% to BRL1.91 billion in the
first quarter 2008, from the first quarter 2007, BNamericas
states.
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 BRADESCO: Forms Unit to Handle Credit Card Operations
-----------------------------------------------------------
Banco Bradesco SA's Chief Executive Officer Marcio Cypriano told
journalists that the bank has created a unit to handle credit
card operations.
Business News Americas relates Banco Bradesco's Vice President
Milton Vargas said that the bank saw the need to form a
subsidiary because credit card lending increased "significantly
with the March 2006 acquisition of Amex in Brazil and growing
private label operations with retailers."
"It's important to have a separate credit card company to get a
hold on the strong growth in this segment," Mr. Vargas commented
to BNamericas.
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 BRADESCO: Won't Enter Commercial Banking Segment Abroad
-------------------------------------------------------------
Banco Bradesco SA's Chief Executive Officer Marcio Cypriano told
journalists that the bank won't venture into the commercial
banking segment outside Brazil.
Banco Bradesco will stick to the local market and "ride the
current wave of continued lending growth," reporters say, citing
Mr. Cypriano.
Mr. Cypriano commented to Business News Americas, "We wouldn't
risk going abroad, not in the short or medium-term. The
opportunities for growth in Brazil are still really big."
According to BNamericas, Mr. Cypriano said that Banco Bradesco
launched a broker dealer in London in 2007, which "has done well
and stirred the bank to move forward with plans to open an
office in Asia." The current increase in lending in Brazil will
continue as higher salaries encourage more loans and economic
stability lets firms to make investments, Mr. Cypriano added.
"A long-standing demand for consumer loans is now beginning to
be met" with people making higher salaries, BNamericas says,
citing Mr. Cypriano.
The report says that Mr. Cypriano sees retail loan growth in the
banking sector at large to slow down slightly compared to 2007.
Mr. Cypriano commented to BNamericas, "Growth in both loans to
SMEs [small and medium-sized enterprises] and large corporates
means companies are investing and they believe in economic
growth. Despite a recent increase in interest rates, no company
[polled by Bradesco's economic research department] has stopped
making investments."
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: Supports Merger in Telecommunication Sector
-----------------------------------------------------------
The management of the Banco Nacional de Desenvolvimento
Economico e Social's equity arm, BNDES Participacőes S.A. a.k.a.
BNDESPAR, approved its support to Telemar Participaçőes S/A
corporate reorganization in the amount of BRL2.569 billion.
“The shareholding reorganization will be critical for the merger
of two operators, Oi and Brasil Telecom, which will result in
the setup of a minimum efficient-scale group, delivering aligned
business strategy, growth capacity, and large enough to compete
internationally in the telecommunication sector”, said BNDES
President, Luciano Coutinho. “Additionally, a new competitor
providing a nationwide integrated network in mobile telephoning
and data transmission, increasing competition in the Brazilian
market, for the benefit of consumers and users. That will
obviously depend on the approval of regulatory changes by
Anatel, after a long process of public hearing and discussions
with society”, said Mr. Coutinho.
BNDES, through BNDESPAR, holds shares in that company since it
was setup, in 1999, outcome of Telebrás group privatization. As
a partner of this enterprise, BNDES supports its reorganization
process.
The bank’s support, then, is a typical operation of BNDESPAR’s
equity share management process. At the end, BNDES’ equity arm
will hold 16.89% of the company's capital stock, smaller than
the current 25%. Also, the Bank's participation in the
operation is an opportunity for valuation and generation of
liquidity for the company and consequently for BNDESPAR’s
investment.
“As it consist in a variable income operation, we will not use
funds from Fundo de Amparo do Trabalhador (Workers' Assistance
Fund), nor other institutional funding sources in Telemar’s
corporate reorganization process. This support, thus, will not
impair BNDES’ credit capacity for new infrastructure and
industry investment projects. BNDESPAR’s goal is to strengthen
Brazilian companies, their capacity to grow, innovate and
improve their management style”, Mr. Coutinho stressed.
The reorganization –- The operation will result in the
withdrawal of three shareholding groups from the holding, Asseca
(GP Investimentos), Lexpart (Citibank and Opportunity) and
Alutrens (Banco do Brasil and private insurance companies). The
final outcome will also consist in the TmarPART split-off, such
that its share in Contax, currently controlled by TmarPART, is
separately set in a new company.
BNDESPAR’s interest will consist in a subscription of
BRL1.239 billion in redeemable nominative preferred shares,
issued by TmarPART. With these funds, the holding will buy
Lexpart Participacoes S/A and Alutrens Participacoes S/A
interest in Telemar Participacoes, corresponding to 10.275% and
10%, respectively. BNDESPAR will also subscribe securities
amounting to BRL1.330 billion, issued by AG Telecom (of Andrade
Gutierrez group) and LF TEL (of La Fonte group).
Last but not least, BNDESPAR will be able to sell about 45% of
its current interest TmarPART’s capital stock (around 11% of the
holding’s capital stock) through a public auction, to rebalance
the interests in the controlled companies. In this auction,
three pension funds -- Petros, of Petrobras employees, Funcef,
of Caixa Economica Federal, and Previ, of Banco do Brasil,
will be able to increase their interest in TmarPART capital
stock.
Shareholders’ Agreement -– As a usual practice in their
shareholding interests, the Bank’s equity arm managed to ensure
several protections in the new shareholders’ agreement it will
participate.
Without BNDESPAR’s vote, for instance, the company cannot
perform operations that may endanger control stability.
BNDESPAR will also keep a qualified veto on relevant matters,
such as mergers, split-offs and general corporate
reorganizations.
If the shareholding control is sold to third parties, BNDESPAR
will be entitled to preemptive and tag along rights. That means
in the event of sale, it may choose to exercise its preemptive
rights on the sale, or even trade its shares for the same price
adopted by the holding, which was not allowed so far.
The shareholders’ agreement, signed by BNDESPAR, also ensures
that both companies keep their staff. The document sets forth
that Oi and Brasil Telecom must keep the same number of job
positions recorded on Feb. 1, 2008, for a three-year period.
Banco Nacional de Desenvolvimento Economico e Social, a.k.a.
BNDES, 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: To Provide Funding to Madeira Project Winner
------------------------------------------------------------
Banco Nacional de Desenvolvimento Economico e Social will
provide financing to the winning consortium of the bidding for
the construction and operation of the 3.3-gigawatt Jirau hydro
plant on the Madeira river, Business News Americas reports.
According to Brazilian power regulator Aneel, groups interested
in bidding for the project were given until April 29 to file
registration documents.
BNamericas relates that Aneel has set a price cap of BRL91 per
megawatt-hour for the Jirau auction. The group that offers sell
power from the plat to regulated clients at lowest price will be
the winning bidder. About 70% of power from Jirau will go to
the regulated market.
Aneel told BNamericas that Jirau will operate with 44 turbines
and plant construction will last for 90 months.
Construction of the plant will cost BRL8.7 billion, BNamericas
says, citing federal energy planning company Empresa de Pesquisa
Energetica.
According to Banco Nacional, 50% of the financing will come
directly from the bank BNDES and the other through lending from
financial institutions it accredited. The bank will will
finance, directly or indirectly, up to 75% of the plant
construction with a repayment period of 25 years. Banco
Nacional is allowed to hold up to 20% of the winning consortium.
Banco Nacional will charge 6.25% plus 0.5% a year to fund the
plant construction, BNamericas states.
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.
BETA SECURITIZADORA: Moody's Raises Global Scale Rating to Ba1
--------------------------------------------------------------
Moody's America Latina Ltda. has upgraded the ratings of the
Series 2005-1 of Real Estate Certificates, Certificados de
Recebiveis Imobiliarios (CRIs) issued by Beta Securitizadora, to
Ba1 from Ba2 (Global Scale, Local Currency), and to Aa2.br from
Aa3.br (Brazilian National Scale).
The upgrade reflects:
-- the improved Loan-to-Value ratio, which declined from 74%
at closing to 67% as of February, 2008;
-- the performance of the deal, which has been in line with
Moody's assumptions since the rating was assigned;
-- the improved market conditions relating to the property
underlying the certificates; and
-- the credit quality the Banco Internacional do Funchal
(Brasil), S.A., lessee of the property underlying the
certificates, currently rated Ba1 (Bank Deposits, Local
Currency) and Aa2.br (Brazilian National Scale: Bank
Deposits, Local Currency).
Moody's adds that the transaction's reserve account, with a
minimum amount equivalent to payment of interest and principal
for one year, has been funded at this required level throughout
the life of the transaction.
The complete rating action:
-- Series 2005-1 of Certificados de Recebíveis Imobiliarios
(CRIs) issued by Beta Securitizadora S.A., upgraded to Ba1
from Ba2 (Global Scale, Local Currency), and to Aa2.br
from Aa3.br (Brazilian National Scale)
BLOCKBUSTER INC: Circuit Stockholder HBK Supports Merger Talks
--------------------------------------------------------------
Circuit City Stores Inc.'s major stockholder urged the retailer
to commence negotiations with Blockbuster Inc. on a proposal to
acquire Circuit City for at least US$6 per share in cash, or
roughly US$1.3 billion, subject to due diligence, various
reports say.
HBK Investments LP holds 15.4 million shares, or about 9.1%
stake of Circuit City and is the third-largest Blockbuster
shareholder, with an 8.5% stake.
In a letter by HBK to Philip J. Schoonover, Circuit City
chairman and chief executive, the Dallas hedge fund urged the
board to allow Blockbuster access to due diligence materials and
to engage in negotiations with Blockbuster so they can make a
definitive proposal.
HBK Investments relates that Carl Icahn, or an affiliate, would
finance the transaction. HBK will also be prepared to provide
financing for such a transaction, as HBK Investments is very
optimistic about the future prospects of a combined company.
HBK Investments stated that an acquisition at a substantial
premium to the current share price is in the best interest of
Circuit City's shareholders. There may also be other parties
interested in acquiring Circuit City or entering into a material
transaction with Circuit City that may provide even greater
value to shareholders.
WSJ states that HBK is the second investor to call on the
company to open its books. According to WSJ, Wattles Capital
Management, which owns 6.5% of Circuit City shares, also called
on the company to allow due diligence. Wattles Capital has
nominated a slate of four directors to the Circuit City board
and has sought through a proxy submission to have the existing
directors replaced at the company's June 24 annual meeting, WSJ
notes.
WSJ relates that Circuit City has refused to provide Blockbuster
financial information, saying it didn't believe the video-rental
company could consummate the proposed transaction in light of
the difficult current financing environment.
About Circuit City Stores Inc.
Headquartered in Richmond, Virginia, Circuit City Stores Inc.
(NYSE: CC) -- http://www.circuitcity.com/-- is a specialty
retailer of consumer electronics, home office products,
entertainment software and related services. The company has
two segments: domestic and international.
About Blockbuster Inc.
Based in Dallas, Texas, Blockbuster Inc. (NYSE: BBI,
BBI.B) -- http://www.blockbuster.com/-- is a leading global
provider of in-home movie and game entertainment, with over
7,800 stores throughout the Americas, Europe, Asia and
Australia. The company maintains operations in Brazil, Mexico,
Denmark, Italy, Taiwan, Australia, among others.
At Jan. 6, 2008, the company's total debt, including capital
lease obligations was US$757.8 million compared with
US$984.2 million in Dec. 31, 2006.
* * *
In December 2007, Fitch Ratings affirmed Blockbuster Inc.'s
long-term Issuer Default Rating at 'CCC' and the senior
subordinated notes at 'CC/RR6'. Fitch said the rating outlook
is stable. The company had approximately US$991 million of debt
outstanding as of
Sept. 30, 2007.
BLOUNT INT'L: Dec. 31 Balance Sheet Upside-Down by US$54 Million
----------------------------------------------------------------
Blount International Inc.'s balance sheet at Dec. 31, 2007,
showed total assets of US$411.949 million and total liabilities
of US$466.095 million, resulting to a total shareholders'
deficit of US$54.146 million.
The company reported results for the fourth quarter and year
ended Dec. 31, 2007.
Net income for fourth quarter was US$17.566 million compared
with net income of US$9.038 million for the same period in the
previous year.
Fourth quarter net income from continuing operations was
US$8.9 million compared to US$8.8 million in the fourth quarter
of 2006. Included in this year's fourth quarter is the
recognition of a loss on the sale of surplus property of US$0.6
million and US$0.4 million in expense for the early
extinguishment of debt.
The company reported net income of US$42.857 million for full
year 2007 compared with net income of US$42.546 million in 2006.
"This past year, we continued to refine our business focus by
exiting non-core businesses," James S. Osterman, chairman and
chief executive officer, stated. "The sale of our Forestry
Equipment Division this past November allowed us to reduce debt
further and remove much of the company's exposure to the
cyclical North American forestry industry.
"Our core business, the Outdoor Products segment, finished with
solid revenue growth in the fourth quarter and a good order
backlog," Mr. Osterman said. "As we progress through 2008, we
expect that our international reach and new product development
will allow us to weather a continuation of weak market
conditions in the North American region."
Liquidity and Capital Resources
Total debt was US$297 million at Dec. 31, 2007 and
US$350.9 million at Dec. 31, 2006, representing a reduction of
US$53.9 million during 2007. Outstanding debt as of Dec. 31,
2007 consisted of a term loan balance of US$122.0 million and 8-
7/8% senior subordinated notes of US$175.0 million. The company
has no principal outstanding on its revolving credit facility as
of Dec. 31, 2007.
Cash and cash equivalents at Dec. 31, 2007, were US$57.6 million
compared to US$27.6 million at Dec. 31, 2006.
About Blount International
Blount International Inc. (NYSE: BLT) -- http://www.blount.com/
-- is a diversified international company operating in two
principal business segments: Outdoor Products and Industrial and
Power Equipment. The company's Outdoor Products segment
provides chain, bars and sprockets to the chainsaw industry,
accessories to the lawn care industry and concrete cutting saws.
Blount manufactures its products in the United States, Canada,
China, and Brazil, and sells them in more than 100 countries.
BRASKEM SA: May Sell US$500 Million Bonds Next Week
---------------------------------------------------
Braskem SA has proposed to sell US$500 million of bonds in
international markets to extend debt payments and repay a bridge
loan, Guillermo Parra-Bernal of Bloomberg News reports, citing
people familiar with the matter.
An unnamed person, who refused to be identified because the
plans were still initial, told Bloomberg that the company may
sell the debt with maturities of seven to 10 years. Another of
Bloomberg's sources also said the sale might take place as early
as the end of next week.
Bloomberg further relates that the company has sought as much as
US$800 million in loans in the form of export pre-payments. To
help fund a joint acquisition of Group Iparinga, the proceeds
from both the bonds and the loan would be utilized to redeem a
US$1.2 billion bridge loan the company took last year, the
report says.
The report, still citing an unnamed source, adds that if market
conditions improve, the company would quicken the bond sale.
Braskem SA (BOVESPA: BRKM5; NYSE: BAK; LATIBEX: XBRK) --
http://www.braskem.com.br/-- is a thermoplastic resins
producer in Latin America, and is among the three largest
Brazilian-owned private industrial companies. The company
operates 13 manufacturing plants located throughout Brazil, and
has an annual production capacity of 5.8 million tons of resins
and other petrochemical products. The company reported
consolidated net revenues of about US$9 billion in the trailing
twelve months through Sept. 30, 2007.
* * *
As reported in the Troubled Company Reporter-Latin America on
Jan. 17, 2008, Fitch Ratings affirmed the 'BB+' foreign and
local currency issuer default ratings of Braskem S.A. Fitch
also affirmed the 'BB+' ratings on the company's senior
unsecured notes 2008, 2014, and senior unsecured notes 2017.
COMMSCOPE INC: Cost Reduction Prompts Shutdown of Brazilian Fab
---------------------------------------------------------------
CommScope Inc. is planning to close its Jaguariuna, Brazil
broadband facility as part of the company's goal to eliminate
duplicate manufacturing and distribution centers to reduce costs
and enhance its long-term competitive position.
The Jaguariuna facility, which employs approximately 200 people
and primarily produces broadband cable products, is expected to
close by the end of September, with most equipment redeployed to
other facilities elsewhere in the world. These changes do not
affect the company’s other Brazilian facility located in
Sorocaba or the company’s ongoing commitment to providing Latin
America customers with high-performance wireless, enterprise and
broadband solutions.
“This is the latest step in our ongoing drive to improve our
competitive position, enhance our long-term financial
performance and achieve our cost-synergy targets associated with
the Andrew Corporation acquisition,” said CommScope President
and Chief Operating Officer Brian Garrett. “We regret the
impact on our people in Jaguariuna and appreciate their many
contributions during the past eight years. However, we have an
extensive worldwide manufacturing and distribution footprint
that can be better utilized and more efficiently operated by
consolidating facilities. As we execute this manufacturing
strategy we intend to make sure that our customers continue to
receive the outstanding service that they have come to expect
from CommScope.”
The 221,000 square-foot Jaguariuna facility was purchased in
June 2000. Both the costs and the savings related to this
facility closing will make up part of the projected total
savings and transition costs announced in connection with the
acquisition of Andrew, which was completed in December 2007.
Separately, CommScope Europe S.P.R.L. has notified its Works
Council of its intention to discontinue production activities at
its facility in Seneffe, Belgium. A final decision on the
proposed restructuring will be made after a consultation period
with the Works Council. The company also has notified employees
of its intent to proceed with the closing of its Capriate, Italy
facility, which was acquired as part of the Andrew acquisition.
Some Capriate activities will be centralized in the company’s
Agrate, Italy site. Discussion is ongoing to finalize these
consolidation plans.
Based in Hickory, North Carolina, CommScope Inc. (NYSE: CTV) --
http://www.commscope.com/-- is a provider of infrastructure
solutions for communication networks. CommScope is also a
manufacturer of coaxial cable for broadband cable television
networks and a provider of environmentally secure cabinets for
DSL and FTTN applications. CommScope has facilities in Brazil,
Australia, China and Ireland.
* * *
As reported in the Troubled Company Reporter-Latin America on
Oct. 19, 2007, Standard & Poor's Ratings Services affirmed its
ratings on CommScope Inc. and Andrew Corp. and removed them from
CreditWatch, where they were placed on June 27, 2007, with
negative implications. S&P also affirmed the 'BB-' corporate
credit and 'B' subordinated debt ratings for both companies.
The outlook is stable.
GOL LINHAS: Board Approves First Quarter 2008 Dividends Payment
--------------------------------------------------------------
GOL Linhas Aereas Inteligentes S.A., the parent company of
Brazilian airlines GOL Transportes Aereos S.A. and VRG Linhas
Aereas S.A., Board of Directors approved the payment of
intercalary dividends, referring to the first quarter of the
fiscal year of 2008, at a meeting held on April 25, 2008.
Amount of Dividends (First Quarter 2008)
The total amount dividends is BRL36,414,106.38 corresponding to
BRL0.18 per common and preferred shares of the company.
Record Date
All outstanding shares on April 30, 2008, inclusive, will be
entitled to receive the dividends approved "record date."
Ex-Dividends Date
The company's shares will be traded on Sao Paulo Stock Exchange
(BOVESPA) and New York Stock Exchange (NYSE), "ex" dividends as
of, and including, May 2, 2008.
Imputation on Mandatory Dividends
The intercalary dividends approved will be imputed to mandatory
dividends related to fiscal year 2008, with no remuneration
whatsoever. The payment of dividends is resolved according to
the quarterly intercalary dividends policy approved by the Board
of Directors in the meeting held on January 28, 2008, in the
fixed amount of BRL0.18, per share, per common and preferred
shares of the Company during 2008. Regardless of the referred
fixed amount, it is assured the payment of the minimum dividend
of 25% of the corporate year's net profit, and if necessary, the
Company will make the year-end adjustment.
Payment of Dividends
The dividends will be paid to shareholders, with no
remuneration, on June 20, 2008.
Based in Sao Paulo, Brazil, GOL Intelligent Airlines aka GOL
Linhas Areas Inteligentes S.A. (NYSE: GOL and Bovespa: GOLL4) --
http://www.voegol.com.br-- through its subsidiary, GOL
Transportes Aereos S.A., provides airline services in Brazil,
Argentina, Bolivia, Uruguay, and Paraguay. The company's
services include passenger, cargo, and charter services. As of
March 20, 2006, Gol Linhas provided 440 daily flights to 49
destinations and operated a fleet of 45 Boeing 737 aircraft.
The company was founded in 2001.
* * *
As reported in the Troubled Company Reporter-Latin America on
July 25, 2007, Fitch Ratings affirmed the 'BB+' foreign and
local currency issuer default ratings of Gol Linhas Aereas
Inteligentes S.A. Fitch also affirmed the outstanding US$200
million perpetual bonds and US$200 million of senior notes due
2017 at 'BB+' as well as the company's 'AA-' (bra) national
scale rating. Fitch said the rating outlook is stable.
HEXCEL CORP: Moody's Keeps Ba3 Corporate Family Rating
------------------------------------------------------
Moody's Investors Service affirmed Hexcel Corporation's
Corporate Family and Probability of Default ratings of Ba3, and
the B1 rating of Hexcel's subordinated notes, but raised the
rating on the Secured Bank Credit Facilities to Baa3 from Ba1.
The rating outlook remains stable.
Because about US$96 million of the term loan portion of the
Credit Facilities was repaid, recovery expectations are higher
under Moody's Loss Given Default methodology and the rating on
the Credit Facilities was raised one notch to Baa3. The claim
of the Credit Facilities in the waterfall benefits from
substantial collateral, up-stream guarantees from Hexcel's
material domestic subsidiaries as well as a significant level of
subordinated debt.
The Ba3 Corporate Family and Probability of Default ratings
balance the company's modest scale, significant market presence,
strong credit metrics, and favorable growth prospects with the
ongoing investment phase in its carbon fiber capacity, which
constrains prospects for near term free cash flow. The rating
also recognizes concentration aspects in Hexcel's customer base
and the cyclical nature of the build rate for new commercial
aircraft. Recent performance demonstrates healthy interest
coverage and significantly lower leverage, and flows from a
combination of higher production rates in commercial aerospace
and wind energy, increasing percentage use of composite
materials in new aircraft, sustained margins, and the
application of proceeds from business divestitures to reduce
indebtedness.
Moody's expects favorable operating trends to continue, but the
company's plan for substantial capital expenditures is likely to
result in no better than break-even free cash flow in the near
term. Consequently, debt is not expected to be reduced. Hexcel
could generate strong free cash flow once the heavy capital
investments begin to ebb and the build-rates for larger aircraft
progress to a normalized production level. The ratings are
further supported by Hexcel's strong competitive position in
what is expected to be a continuing robust environment for OEM
aircraft suppliers.
While Hexcel is anticipated to generate credit metrics at levels
at or above those typical for the Ba3 rating, the rating
considers uncertainty in the pace at which the Airbus A380 (on
which Hexcel will have US$3 million content per aircraft,
according to the company) and the ongoing delays in production
of Boeing's B787 (on which Hexcel will have between US$1.3
million to US$1.6 million of content per aircraft, according to
the company). Also, a shareholder activist group has proposed
three alternative nominees to Hexcel's board of directors (the
shareholders meeting is scheduled for May 8, 2008) and has
further said that shareholder value has not been maximized.
Uncertainty of future financial policies constrains the rating.
The stable rating outlook reflects Moody's expectations for
continued healthy operating margins and revenue growth in an
ongoing robust commercial aerospace environment and is supported
by the firm's satisfactory liquidity profile despite the
prospects for break-even free cash flow in 2008. The stable
outlook also assumes that any developments relating to the
production and delivery schedule of the A380 or B787 will have
no material negative impact on the company's margins or working
capital requirements.
Ratings upgraded with revised Loss Given Default Assessments:
-- US$125 million secured revolving credit facility, Baa3
(LGD-2, 14%) from Ba1 (LGD-2, 22%)
-- US$87 million secured term loan, Baa3 (LGD-2, 14%) from
Ba1 (LGD-2, 22%)
Ratings affirmed with revised Loss Given Default Assessment:
-- Corporate Family, Ba3;
-- Probability of Default, Ba3;
-- US$225 million senior subordinated notes, B1 (LGD-4, 69%).
The last rating action was on April 3, 2007 at which time
Hexcel's Corporate Family and Probability of Default ratings
were up-graded to Ba3 from B1.
Hexcel Corporation, headquartered in Stamford, CT, is a leading
advanced structural materials company. It develops,
manufactures and markets lightweight, high-performance
structural materials, including carbon fibers, reinforcements,
prepregs, honeycomb, matrix systems, adhesives and composite
structures, used in commercial aerospace, space and defense, and
certain industries. Revenues in 2007 were approximately
US$1.2 billion. The company has subsidiaries in Austria, the
United Kingdom, Spain, Hong Kong, Japan and Brazil.
PROPEX INC: Wants to Extend Exclusive Plan-Filing to Oct. 18
------------------------------------------------------------
Propex Inc. and its debtor-affiliates ask the U.S. Bankruptcy
Court for the Eastern District of Tennessee to extend (i) their
Exclusive Plan Filing Period until Oct. 18, 2008; and (ii) their
Exclusive Solicitation Period until Dec. 17, 2008.
Pursuant to Section 1121(b) of the Bankruptcy Code, a chapter 11
debtor has the exclusive right to file a plan of reorganization
during the first 120 days following the filing of its chapter 11
petition, and thereafter to solicit acceptances to any plan so
filed for a period of an additional 60 days. Thus, under
Section 1121, the Debtors have the exclusive right to file a
plan of reorganization until May 19, 2008, and the exclusive
right to solicit acceptances to that plan until July 16, 2008.
Section 1121(d) also provides that the Court may extend or
increase a debtor's period of exclusivity upon a showing of
cause.
Mark W. Wege, Esq., at King & Spalding, LLP, in Houston, Texas,
asserts that based on the size and complexity of the Debtors'
Chapter 11 cases, a 120-day exclusivity period is not enough
time within which the Debtors may negotiate, draft and propose a
consensual Chapter 11 Plan, as well as conduct all the other
duties incumbent upon a debtor-in-possession.
As of the Petition Date, the Debtors had approximately
US$585.7 million in assets, and roughly US$527.4 million in
liabilities. Moreover, the Debtors have approximately 3,200
employees world-wide and 1,925 employees in the United States.
The Debtors have only had enough time to take the initial steps
in the case and stabilize their business after their Chapter 11
filing, Mr. Wege notes.
In the less than three months since the bankruptcy filing, Mr.
Wege informs the Honorable John C. Cook, the Debtors'
management, employees, advisors and counsel have devoted
substantial time and effort to a number of tasks, including:
(a) the negotiation, proposal and finalization of the terms of
the Debtors' US$60,000,000 postpetition financing, and
resolving all objections to the Debtors' request to obtain
DIP Financing;
(b) the review of numerous executory contracts and leases, and
seeking the rejection of certain agreements;
(c) the determination of whether and how each of the Debtors'
numerous projects should be restructured;
(d) the holding of frequent meetings and conference calls with
the Official Committee of Unsecured Creditors and
providing extensive, in-depth information and
documentation in response to the Creditors Committee's due
diligence reports;
(e) the preparation of responses to numerous creditor,
supplier and customer inquiries; and
(f) the compilation of information required to complete the
Debtors' schedules and statements of financial affairs and
filing them on April 1, 2008.
Mr. Wege tells the Court that those tasks have been particularly
time consuming since the Debtors have engaged in regular
discussions with counsel for the Official Committee of Unsecured
Creditors to negotiate various issues. Additionally, the change
in the Debtors' leadership team, and the required time to
develop strategy associated with the Debtors' businesses has and
will take time to materialize, Mr. Wege says.
The Debtors have made considerable progress in laying the
foundational groundwork necessary for a successful
reorganization, as well as taking other steps to stabilize their
businesses and insure long-term profitability, Mr. Wege
maintains. The Debtors' monthly operating reports show positive
EBITDA and cash flows, he avers.
Based on the progress in their bankruptcy cases, the Debtors
believe that their prospects for ultimately proposing and filing
a viable Plan are favorable, thereby warranting an extension of
the Exclusivity Period.
About Propex
Headquartered in Chattanooga, Tennessee, Propex Inc. --
http://www.propexinc.com/-- produces geosynthetic, concrete,
furnishing, and industrial fabrics and fiber. It is produces
primary and secondary carpet backing. Propex operates in North
America, Europe, and Brazil.
The company and its debtor-affiliates filed for Chapter 11
protection on Jan. 18, 2008 (Bankr. E.D. Tenn. Case No. 08-
10249).
The debtors' has selected Edward L. Ripley, Esq., Henry J. Kaim,
Esq., and Mark W. Wege, Esq. at King & Spalding, in Houston,
Texas, to represent them. As of Sept. 30, 2007, the debtors'
balance sheet showed total assets of US$585,700,000 and total
debts of US$527,400,000. The Debtors' exclusive period to file
a plan of reorganization expires on May 17, 2008.
(Propex Bankruptcy News, Issue No. 10; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000)
PROPEX: Wants Court to Extend Lease Decision Period to Aug. 15
--------------------------------------------------------------
Propex Inc. and its debtor-affiliates ask the U.S. Bankruptcy
Court for the Eastern District of Tennessee to extend the time
within which they must assume or reject leases, through and
including Aug. 15, 2008.
The Debtors are presently lessees under 15 unexpired non-
residential real property leases, including their corporate
headquarters located at Lee Highway, in Chattanooga, Tennessee.
Edward L. Ripley, Esq., at King & Spalding, LLP, in Houston,
Texas, relates that the Debtors are at an early stage of their
Chapter 11 cases, and are currently dealing with a variety of
important issues regarding the progression of their bankruptcy
proceedings.
While the Debtors have until May 19, 2008, to determine whether
the Leases should be assumed or rejected, Mr. Ripley notes, they
have already undertaken a comprehensive review of their business
operations, assets and contractual obligations, including the
Leases they have entered into. Mr. Ripley asserts that while
the extensive review process is underway, it is not in the best
interests of the Debtors' estates or their creditors to force
the Debtors to assume or reject the Leases prematurely.
"A decision to assume has significant implications on the
estates since, as the Court is aware, any assumption may create
administrative claims if a particular Lease is later determined
to be no longer needed," Mr. Ripley says.
About Propex
Headquartered in Chattanooga, Tennessee, Propex Inc. --
http://www.propexinc.com/-- produces geosynthetic, concrete,
furnishing, and industrial fabrics and fiber. It is produces
primary and secondary carpet backing. Propex operates in North
America, Europe, and Brazil.
The company and its debtor-affiliates filed for Chapter 11
protection on Jan. 18, 2008 (Bankr. E.D. Tenn. Case No. 08-
10249).
The debtors' has selected Edward L. Ripley, Esq., Henry J. Kaim,
Esq., and Mark W. Wege, Esq. at King & Spalding, in Houston,
Texas, to represent them. As of Sept. 30, 2007, the debtors'
balance sheet showed total assets of US$585,700,000 and total
debts of US$527,400,000. The Debtors' exclusive period to file
a plan of reorganization expires on May 17, 2008.
(Propex Bankruptcy News, Issue No. 10; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000)
SADIA SA: To Form Joint Venture With Kraft Foods
------------------------------------------------
Sadia S.A. has signed a partnership agreement with Kraft Foods
Brasil S.A. and Kraft Foods Holdings, Inc., for the formation of
a joint venture, a regulatory filing with the U.S. Securities
and Exchange Commission discloses.
The joint venture, of which Kraft will hold 51% of the voting
shares while Sadia the remaining 49%, will manufacture, market
and distribute, in Brazil, cheese products, including those
currently marketed by Kraft under the Philadelphia brands, as
well as cheese products and cheese spreads sold under the Sadia
brand.
The joint venture will take the form of a closed corporation
with its registered address and industrial park located in
Curitiba-PR, the SEC filing relates. The corporation will have
its own independent structure and corporate governance.
Sadia estimates at BRL30 million the initial investment to set
up the business. The company expects revenues of the joint
venture to reach BRL40 million in its first year of business.
Upon the execution of the final documents by the parties, as
required by the partnership agreement, the JV will commence its
activities by the second half of August 2008.
In addition to the partnership pact, Sadia and Kraft also
executed a distribution agreement pursuant to which Sadia will
market and distribute the whole portfolio of cheese products
manufactured by Kraft, on an exclusive basis.
Sadia believes the partnership with Kraft represents an
important step towards strengthening the company in the segment
of cheese and is in full alignment with its strategy of growth
and creation of value.
Sadia S.A., headquartered in Sao Paulo, Brazil, exports over
1,000 different products to more than 100 countries and is the
largest slaughterer and distributor of poultry and pork
products, as well as the leading refrigerated and frozen protein
products company in Brazil. For the last twelve months ending
in December 2006, the company had net sales of BRL 6.9 billion
(ca. US$3 billion) with approximately 45% of revenues derived
from exports.
* * *
As reported by the Troubled Company Reporter-Latin America on
Feb. 26, 2007, Standard & Poor's Ratings Services affirmed its
'BB' long-term corporate credit rating on Sadia S.A. The
outlook is stable.
TELEMAR NORTE: S&P Affirms BB+ Rating Over Brasil Telecom Merger
----------------------------------------------------------------
Standard & Poor's Ratings Services has affirmed its 'BB+' long-
term corporate credit rating on Tele Norte Leste Participacoes
S.A. and Telemar Norte Leste S.A., (collectively, Telemar). S&P
also affirmed its 'brAA+' national scale corporate credit
ratings on Tele Norte Leste Participacoes SA and Telemar Norte
Leste SA.
At the same time, S&P affirmed its 'brAA+' national scale long-
term corporate credit rating on Brasil Telecom S.A. and Brasil
Telecom Participacoes S.A., (collectively, Brasil Telecom). The
outlook on the corporate credit ratings is stable.
The rating actions follow the announcement by Telemar that it
reached an agreement to acquire control of Brasil Telecom for
approximately US$3.5 billion (BRL5.9 billion). The conclusion
of the deal depends on regulatory approval, which includes
changes in the Brazilian National Plan of Concessions, Plano
Geral de Outorgas (PGO) to legally allow for the companies to be
combined. Antitrust approvals are also needed, posing some
execution risks in the near term. The ratings are also tempered
by the integration risks that are typical in this type of
transaction.
In addition to the controlling stake acquisition, S&P expects
Telemar to proceed with a voluntary offer to acquire nonvoting
shares -- limited to one-third of these shares -- from minority
shareholders at both Brasil Telecom SA and Brasil Telecom
Participacoes SA in the coming months. The rating agency also
expects mandatory offers for voting minority shareholders at
Brasil Telecom to be made following the approval from regulatory
and antitrust entities and the conclusion of the acquisition.
S&P estimate these offers totaling approximately US$4.6 billion
to Telemar. An upfront payment of US$189 million (BRL315
million) will be made to previous shareholders at Brasil Telecom
to resolve certain legal litigations. If antitrust authorities
don't approve the transaction within 240 days, Telemar will have
to pay a breakup fee of approximately US$290 million (BRL490
million). In S&P's opinion, this would not negatively affect
Telemar's credit quality, given its strong liquidity.
"If regulatory authorities approve the merger, S&P expects the
combined company to benefit from significant synergies thanks to
complementary geographies and economies of scope and scale,
leading to improved cash-flow fundamentals," said S&P's credit
analyst Victor Saulytis. The new company will be the largest
telecom company in Latin America, with pro-forma revenues around
US$17 billion (BRL29 billion), operations in virtually all
states of the country except Săo Paulo, more than 22.2 million
fixed lines in service, and 20.3 million mobile phone
subscribers. Medium- to long-term growth potential is also
relevant. The new company projects 38 million mobile phone
subscribers in the next five years, compared with its current
combined base of 20.3 million. The new company also has plans
to quadruple its broad-band base, reaching 12 million
subscribers (currently around 3,000,000). Growth potential is
also significant in pay TV, where S&P expects the new company to
service 8,000,000 users in the next five years, expanding its
cash flow sources.
The stable outlook reflects S&P's view that, despite the fierce
competitive environment and rapidly shifting technologies,
Telemar and Brasil Telecom will sustain leading positions in
their service areas, leading to strong cash generation to face
acquisition debt. This will be supported by these companies'
diversified services portfolio, the complementary coverage area,
and both individual and combined financial strengths, including
high levels of liquidity and cash-flow generation. The outlook
could change to positive if the companies continue delivering
strong profitability and cash generation, coupled with improving
credit metrics and prudent financial policies. Negative
pressure on ratings would come from a material shift in the
expected financial profile of the new entity due to a more
aggressive financial policy. Deterioration in the competitive
and economic environment affecting its operations (e.g.,
inflationary pressures, higher interest rates, or a deep decline
of consumers' confidence) could also negatively affect the
ratings.
Headquartered in Rio de Janeiro, Brazil, Telemar Norte Leste SA
operates a local fixed-line telephone in Brazil. The company is
a subsidiary of Tele Norte Leste Participacoes SA. Telemar
Norte Leste SA operates in the states of Rio de Janeiro, Minas
Gerais, Espirito Santo, Bahia, Sergipe, Alagoas, Pernambuco,
Paraiba, Rio Grande do Norte and Amazonas, among others. Its
subsidiaries include Telemar Internet Ltda., which provides
Internet services.
TELE NORTE: Will List Preferred Shares in Telemar Norte on NYSE
---------------------------------------------------------------
Tele Norte Leste Participacoes SA's officials told Dow Jones
Newswires that it will list preferred shares in operating firm
Telemar Norte Leste on the New York Stock Exchange once the deal
to acquire control of Brasil Telecom Participacoes is completed.
According to Dow Jones, Tele Norte's Investor Relations Director
Roberto Terziani said that the firm also wants to list Telemar
common shares.
Tele Norte doesn't risk reducing the liquidity of its shares
with a second issue, Dow Jones says, citing Mr. Terziani. "On
the contrary, it will give investors more options," Mr. Terziani
added.
Headquartered in Rio de Janeiro, Brazil, Tele Norte Leste
Participacoes SA -- http://www.telemar.com.br-- is a provider
of fixed-line telecommunications services in South America. The
company markets its services under its Telemar brand name. Tele
Norte's subsidiaries include Telemar Norte Leste SA; TNL PCS SA;
Telemar Internet Ltda.; and Companhia AIX Participacoes SA.
* * *
As reported on April 27, 2007, Standard & Poor's Ratings
Services placed on CreditWatch with negative implications the
'BB+' corporate credit rating on Tele Norte Leste Participacoes
S.A. The creditwatch resulted from TmarPart's decision to buy
out its holding company's preferred shares.
TELE NORTE: S&P Affirms BB+ Rating Over Brasil Telecom Merger
-------------------------------------------------------------
Standard & Poor's Ratings Services has affirmed its 'BB+' long-
term corporate credit rating on Tele Norte Leste Participacoes
S.A. and Telemar Norte Leste S.A., (collectively, Telemar). S&P
also affirmed its 'brAA+' national scale corporate credit
ratings on Tele Norte Leste Participacoes SA and Telemar Norte
Leste SA.
At the same time, S&P affirmed its 'brAA+' national scale long-
term corporate credit rating on Brasil Telecom S.A. and Brasil
Telecom Participacoes S.A., (collectively, Brasil Telecom). The
outlook on the corporate credit ratings is stable.
The rating actions follow the announcement by Telemar that it
reached an agreement to acquire control of Brasil Telecom for
approximately US$3.5 billion (BRL5.9 billion). The conclusion
of the deal depends on regulatory approval, which includes
changes in the Brazilian National Plan of Concessions, Plano
Geral de Outorgas (PGO) to legally allow for the companies to be
combined. Antitrust approvals are also needed, posing some
execution risks in the near term. The ratings are also tempered
by the integration risks that are typical in this type of
transaction.
In addition to the controlling stake acquisition, S&P expects
Telemar to proceed with a voluntary offer to acquire nonvoting
shares -- limited to one-third of these shares -- from minority
shareholders at both Brasil Telecom SA and Brasil Telecom
Participacoes SA in the coming months. The rating agency also
expects mandatory offers for voting minority shareholders at
Brasil Telecom to be made following the approval from regulatory
and antitrust entities and the conclusion of the acquisition.
S&P estimate these offers totaling approximately US$4.6 billion
to Telemar. An upfront payment of US$189 million (BRL315
million) will be made to previous shareholders at Brasil Telecom
to resolve certain legal litigations. If antitrust authorities
don't approve the transaction within 240 days, Telemar will have
to pay a breakup fee of approximately US$290 million (BRL490
million). In S&P's opinion, this would not negatively affect
Telemar's credit quality, given its strong liquidity.
"If regulatory authorities approve the merger, S&P expects the
combined company to benefit from significant synergies thanks to
complementary geographies and economies of scope and scale,
leading to improved cash-flow fundamentals," said S&P's credit
analyst Victor Saulytis. The new company will be the largest
telecom company in Latin America, with pro-forma revenues around
US$17 billion (BRL29 billion), operations in virtually all
states of the country except Săo Paulo, more than 22.2 million
fixed lines in service, and 20.3 million mobile phone
subscribers. Medium- to long-term growth potential is also
relevant. The new company projects 38 million mobile phone
subscribers in the next five years, compared with its current
combined base of 20.3 million. The new company also has plans
to quadruple its broad-band base, reaching 12 million
subscribers (currently around 3,000,000). Growth potential is
also significant in pay TV, where S&P expects the new company to
service 8,000,000 users in the next five years, expanding its
cash flow sources.
The stable outlook reflects S&P's view that, despite the fierce
competitive environment and rapidly shifting technologies,
Telemar and Brasil Telecom will sustain leading positions in
their service areas, leading to strong cash generation to face
acquisition debt. This will be supported by these companies'
diversified services portfolio, the complementary coverage area,
and both individual and combined financial strengths, including
high levels of liquidity and cash-flow generation. The outlook
could change to positive if the companies continue delivering
strong profitability and cash generation, coupled with improving
credit metrics and prudent financial policies. Negative
pressure on ratings would come from a material shift in the
expected financial profile of the new entity due to a more
aggressive financial policy. Deterioration in the competitive
and economic environment affecting its operations (e.g.,
inflationary pressures, higher interest rates, or a deep decline
of consumers' confidence) could also negatively affect the
ratings.
Headquartered in Rio de Janeiro, Brazil, Tele Norte Leste
Participacoes SA -- http://www.telemar.com.br-- is a provider
of fixed-line telecommunications services in South America. The
company markets its services under its Telemar brand name. Tele
Norte's subsidiaries include Telemar Norte Leste SA; TNL PCS SA;
Telemar Internet Ltda.; and Companhia AIX Participacoes SA.
UNSINAS SIDERURGICAS: Issues First Quarter 2008 Earnings Webcast
----------------------------------------------------------------
Usinas Siderurgicas de Minas Gerais S.A. (a.k.a. Usiminas)
posted this Webcast Alert:
What: First Quarter 2008 Results Conference Call, which
will be released on April 30, 2008, before the
opening of Bovespa's trading session
When: May 5, 2008 @ 9:00 AM EST in Portuguese and 11:00 AM
EST in English
Where: http://prnewswire.isat.com.br/?palestra_id=307
How: Simply log on to the company's Web site.
Contact: Investor Relations Usiminas,
Tel. Number: +55 31 3499-8710
email add: investidores@usiminas.com.br
The conference call will be archived at
http://www.usiminas.com.br
To access the replay, click on Investor Relations Section.
Headquartered in Minas Gerais, Brazil, Usinas Siderurgicas de
Minas Gerais SA -- http://www.usiminas.com.br-- 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. Moody's said the rating outlook is stable.
==========================
C A Y M A N I S L A N D S
==========================
BLACK BEAR: Will Hold Final Shareholders Meeting on May 2
---------------------------------------------------------
Black Bear Funding Limited will hold its final shareholders
meeting on May 2, 2008, at 11:00 a.m. at the office of the
company.
These matters will be taken up during the meeting:
-- receiving an account showing the manner in which
the winding-up of the company has been conducted
and its property disposed of and hearing any
explanation that may be given by the liquidator; and
-- authorizing the liquidators to retain the records of the
company for a period of five years from the dissolution of
the company, after which they may be destroyed.
Black Bear's shareholders agreed on March 17, 2008, to place the
company into voluntary liquidation under The Companies Law (2004
Revision) of the Cayman Islands.
The liquidators can be reached at:
John Cullinane and Derrie Boggess
c/o Walkers SPV Limited
Walker House, 87 Mary Street
George Town, Grand Cayman KY1-9002
Cayman Islands
BPI DIRECTORS: Will Hold Final Shareholders Meeting on May 2
------------------------------------------------------------
BPI Directors Ltd. will hold its final shareholders meeting on
May 2, 2008, at 4:00 p.m. at BPI (Suisse), Rue Etiene Dumont,
11th, Geneve, Switzerland.
These matters will be taken up during the meeting:
-- receiving an account showing the manner in which
the winding-up of the company has been conducted
and its property disposed of and hearing any
explanation that may be given by the liquidator; and
-- determining where and how long the records of the company
should be kept.
BPI Directors' shareholders agreed on March 25, 2008, to place
the company into voluntary liquidation under The Companies Law
(2004 Revision) of the Cayman Islands.
The liquidator can be reached at:
Antonio Luna Vaz
Attn: Kim Charaman
Close Brothers (Cayman) Limited
Fourth Floor, Harbour Place
P.O. Box 1034, Grand Cayman KYI-1102
Cayman Islands
Telephone: (345) 949 8455
Fax: (345) 949 8499
CLEARWATER CAPITAL: Sets Final Shareholders Meeting for May 2
-------------------------------------------------------------
Clearwater Capital Partners Pacific Ltd. will hold its final
shareholders meeting on May 2, 2008, at 10:30 a.m. at the office
of the company.
These matters will be taken up during the meeting:
-- receiving an account showing the manner in which
the winding-up of the company has been conducted
and its property disposed of and hearing any
explanation that may be given by the liquidator; and
-- authorizing the liquidators to retain the records of the
company for a period of five years from the dissolution of
the company, after which they may be destroyed.
Clearwater Capital's shareholders agreed on March 13, 2008, to
place the company into voluntary liquidation under The Companies
Law (2004 Revision) of the Cayman Islands.
The liquidators can be reached at:
John Cullinane and Derrie Boggess
c/o Walkers SPV Limited
Walker House, 87 Mary Street
George Town, Grand Cayman KY1-9002
Cayman Islands
COUNTER MANAGEMENT: Sets Final Shareholders Meeting for May 2
-------------------------------------------------------------
Counter Management Limited will hold its final shareholders
meeting on May 2, 2008, at 1:00 p.m. at the company's registered
office.
These matters will be taken up during the meeting:
-- receiving an account showing the manner in which
the winding-up of the company has been conducted
and its property disposed of and hearing any
explanation that may be given by the liquidator; and
-- authorizing the liquidators to retain the records of the
company for a period of five years from the dissolution of
the company, after which they may be destroyed.
Counter Management's shareholders agreed on March 19, 2008, to
place the company into voluntary liquidation under The Companies
Law (2004 Revision) of the Cayman Islands.
The liquidators can be reached at:
John Cullinane and Derrie Boggess
c/o Walkers SPV Limited
Walker House, 87 Mary Street
George Town, Grand Cayman KY1-9002
Cayman Islands
KINETIC CONCEPTS: Earns US$68 Million in First Quarter 2008
-----------------------------------------------------------
Kinetic Concepts, Inc., reported first quarter 2008 total
revenue of US$420.0 million, an increase of 14% from the first
quarter of 2007. Foreign currency exchange movements favorably
impacted total revenue for the first quarter of 2008 by 4%
compared to the corresponding period of the prior year.
Net earnings for the first quarter of 2008 were US$68.0 million,
up 27%, compared to US$53.6 million for the same period one year
ago. Net earnings per diluted share for the first quarter of
2008 increased 25% to US$0.94 compared to US$0.75 for the same
period in the prior year.
“During the first quarter, we made progress on a number of
initiatives we have planned for 2008,” said Catherine Burzik,
President and Chief Executive Officer of KCI. “We realigned our
domestic sales force, improving both focus and customer service
levels, submitted our application for regulatory approval of
V.A.C.(R) in Japan and completed due diligence related to a
major acquisition. On top of these development activities, we
delivered higher revenue, earnings and margins compared to the
prior year.”
Revenue Recap – First Quarter 2008
During 2007, we took steps to structure KCI as a global company,
which included the alignment of key leadership positions for
specific geographic regions. Beginning with the first quarter
2008, we have reported financial results consistent with this
new structure. The geographic reporting structure is made up of
(i) North America, which consists of the United States, Canada
and Puerto Rico and (ii) Europe, the Middle East and Africa and
the Asia Pacific region.
Total revenue for North America was US$309.5 million for the
first quarter of 2008, an increase of US$25.8 million, or 9%,
from the prior-year period due primarily to increased rental and
sales volumes for V.A.C. wound healing devices and related
disposables. North American V.A.C. revenue of US$250.2 million
for the first quarter was 10% higher than the same period one
year ago due to continued market penetration. Rental unit
growth was reported across all care settings. North American
revenue from Therapeutic Support Systems was US$59.2 million for
the first three months of 2008, a 4% increase from the prior-
year period, due to higher rental unit volume in the acute care
setting, partially offset by lower TSS sales in the period.
Total revenue outside of North America, which consists of EMEA
and APAC, was US$110.6 million for the first quarter of 2008, an
increase of 30%, compared to the prior-year period due primarily
to an increase in V.A.C. revenue. EMEA/APAC V.A.C. revenue for
the first three months of 2008 was US$82.7 million, an increase
of US$21.1 million, or 34%, from the prior-year period.
EMEA/APAC TSS revenue increased 18% from the prior-year period
to US$27.8 million for the first quarter resulting primarily
from an increase in rental volume and favorable foreign currency
exchange movements. Foreign currency exchange movements
favorably impacted total EMEA/APAC revenue by 14% compared to
the prior-year period. Foreign currency exchange movements
favorably impacted EMEA/APAC V.A.C. and TSS revenue by 14% and
13%, respectively, in the 2008 first quarter.
Worldwide V.A.C. revenue was US$333.0 million for the first
quarter of 2008, an increase of 15% from the prior-year period.
Foreign currency exchange movements favorably impacted worldwide
V.A.C. revenue by less than 4% compared to the first quarter of
the prior year. The growth in V.A.C. revenue stemmed from
increased market penetration, resulting in higher rental and
sales unit volumes.
Worldwide TSS revenue was US$87.1 million for the first quarter
of 2008, an increase of US$6.8 million, or 8%, due primarily to
higher rental unit volume worldwide and foreign currency
exchange movements. Foreign currency exchange movements
favorably impacted worldwide TSS revenue by 5% compared to the
same period one year ago.
Profit Margins
Gross profit for the first quarter of 2008 was US$209.0 million,
an increase of 22% from the prior-year period. Gross profit
margin was 49.8% for the first quarter of 2008, an increase of
approximately 335 basis points from the same period one year
ago. As a percent of total revenue, lower field service
expenses, product depreciation, cost of sales and marketing
costs made up the majority of the increase in gross margin.
Selling, general and administrative expenses increased US$17.1
million, or 22%, year-to-year. The SG&A increase was due
primarily to certain costs associated with the U.S. sales force
realignment, additional costs associated with the transition of
V.A.C. unit production to our Ireland manufacturing facility and
higher share-based compensation expenses. Research and
development spending increased 50% from the prior-year period to
US$14.7 million for the quarter. Total research and development
expenses represented 3.5% of revenue for the first quarter of
2008.
Balance Sheet
Total long-term debt outstanding at March 31, 2008 was US$68.0
million. Total cash at quarter-end was US$305.2 million, an
increase of US$39.2 million from year-end 2007.
Notes Offering
On April 21, 2008, the company closed its offering of US$600
million aggregate principal amount of 3.25% convertible senior
notes due 2015. The company has also granted an option to the
initial purchasers of the notes to purchase up to an additional
US$90 million aggregate principal amount of notes to cover over-
allotments. The over-allotment option is exercisable during the
13 day period beginning on the closing date. The coupon on the
notes will be 3.25% per year on the principal amount. Interest
will accrue from April 21, 2008, and will be payable semi-
annually in arrears on April 15 and October 15 of each year,
beginning Oct. 15, 2008.
The notes will mature on April 15, 2015, unless previously
converted or repurchased in accordance with their terms. The
notes are not redeemable by us prior to the maturity date. Upon
conversion, holders will receive cash up to the aggregate
principal amount of the notes being converted and shares of KCI
common stock in respect of the remainder, if any, of KCI’s
conversion obligation in excess of the aggregate principal
amount of the notes being converted. The initial conversion
rate for the notes is based on an initial conversion price of
approximately US$51.34 per share of common stock and represents
a 27.5% conversion premium over the last reported sale price of
KCI’s common stock on April 15, 2008 (the day of pricing of the
notes), which was US$40.27 per share. In connection with the
offering, we entered into convertible note hedge and warrant
transactions with financial institutions that are affiliates of
two of the offering’s initial purchasers to increase the
effective conversion price of the notes to approximately
US$60.41, which is approximately 50% higher than the closing
price of the Company’s common stock on April 15, 2008. The
company intends to settle the principal amount of these notes in
cash. The net proceeds of this offering will be used, in
combination with other financing arrangements and existing cash
on hand, primarily to fund our acquisition of LifeCell
Corporation.
Income Tax Rate
The effective income tax rate for the first quarter of 2008 was
33.5%, which was comparable to 33.2% for the same period in
2007.
Outlook
This guidance is based on current information and expectations
as of April 22, 2008:
KCI is reaffirming its projections for 2008 total revenue of
US$1.77 – US$1.82 billion based on continued demand for its
V.A.C. negative pressure wound therapy devices and related
supplies. The company is also reaffirming its projections for
net earnings per diluted share for 2008 of US$3.85 – US$3.95 per
diluted share, based upon a weighted average diluted share
estimate of 72.0 – 73.0 million shares. This outlook excludes
the impact associated with our anticipated acquisition of
LifeCell.
About KCI
Kinetic Concepts, Inc. (NYSE:KCI) -- http://www.kci1.com/-- is
a global medical technology company with leadership positions in
advanced wound care and therapeutic support systems. The
company designs, manufactures, markets and services a wide range
of proprietary products that can improve clinical outcomes and
can help reduce the overall cost of patient care. The company
has subsidiaries in Austria, Belgium, Cayman Islands, Japan,
Netherlands, Puerto Rico and Singapore, among others.
KINETIC CONCEPTS: Moody's Rates Proposed US$1.3BB Loan at Ba1
-------------------------------------------------------------
Moody's Investors Service assigned a Ba1 rating to Kinetic
Concepts, Inc's proposed US$1.3 billion senior secured first
lien credit facility, consisting of a US$1 billion term loan and
a US$300 million revolver. The Corporate Family Rating remains
unchanged at Ba2 and the ratings outlook is stable.
In addition, in accordance with Moody's Loss Given Default
methodology the probability of default rating was revised to Ba2
from Ba3 due to the introduction of unsecured debt into the
capital structure, which led to changes in assumptions for asset
recovery and a lower implied likelihood of default. Moody's
will withdraw the ratings on KCI's existing senior secured
revolving credit facility (rated Ba2) at the close of the
transaction.
The proceeds of the proposed credit facility will be used to
finance the acquisition of LifeCell Corporation and repay the
amounts outstanding under KCI's existing senior secured credit
facility, which will be terminated at the close of the
transaction. The new credit facility is rated one notch higher
than the Corporate Family Rating, benefiting from the first loss
absorption that will be provided by the recently issued
US$600 million unsecured 3.25% convertible notes.
Assigned:
-- Proposed US$300 million Senior Secured Revolving Credit
Facility due 2013, Ba1, LGD3, 32%
-- Proposed US$1,000 million Senior Secured Term Loan A due
2013, Ba1, LGD3, 32%
Revised:
-- Probability of Default Rating, to Ba2 from Ba3
To be withdrawn:
-- Existing US$500 million Senior Secured Revolving Credit
Facility due 2012, Ba2, LGD3, 34%
The ratings outlook is stable.
Kinetic Concepts, Inc., headquartered in San Antonio, Texas, is
a global medical technology company with leadership positions in
advanced wound care and therapeutic support systems. The
company's advanced would care systems incorporate proprietary
Vacuum Assisted Closure Therapy technology. LifeCell is a
leading provider of innovative biological products for soft
tissue repair. Moody's estimates that the combined company
would have reported pro forma revenues of approximately
US$1.8 billion for the twelve months ended Dec. 31, 2007.
KINETIC CONCEPTS: 2008 Shareholders' Meeting Scheduled on May 20
----------------------------------------------------------------
Ronald W. Dollens, Chairman of Kinetic Concepts, Inc.'s Board of
Directors, said in a regulatory filing that the 2008 annual
meeting of the company's shareholders will be held on May 20,
2008 at 8:30 a.m. CDT.
The meeting will be the Westin Riverwalk Hotel – Hidalgo Room,
420 West Market Street in San Antonio, Texas.
At the meeting, shareholders will be asked to:
-- elect three Class A directors for a three-year term;
-- approve a new 2008 Omnibus Stock Incentive Plan;
-- ratify the selection of Ernst & Young LLP as the
company's independent auditors for our fiscal year
ending Dec. 31, 2008.
-- transact such other business as may properly come
before the meeting or any adjournment or postponement
thereof.
Only the company's shareholders of record at the close of
business on April 9, 2008 are entitled to notice of and to vote
at the annual meeting and at any adjournment or postponement
thereof. The company has subsidiaries in Austria, Belgium,
Cayman Islands, Japan, Netherlands, Puerto Rico and Singapore,
among others.
About KCI
Kinetic Concepts, Inc. (NYSE:KCI) -- http://www.kci1.com/-- is
a global medical technology company with leadership positions in
advanced wound care and therapeutic support systems. The
company designs, manufactures, markets and services a wide range
of proprietary products that can improve clinical outcomes and
can help reduce the overall cost of patient care. The company
has subsidiaries in Austria, Belgium, Cayman Islands, Japan,
Netherlands, Puerto Rico and Singapore, among others.
KINGSWAY PROPERTY: Sets Final Shareholders Meeting for May 2
------------------------------------------------------------
Kingsway Property Corporation will hold its final shareholders
meeting on May 2, 2008, at 11:15 a.m. at the office of the
company.
These matters will be taken up during the meeting:
-- receiving an account showing the manner in which
the winding-up of the company has been conducted
and its property disposed of and hearing any
explanation that may be given by the liquidator; and
-- authorizing the liquidators to retain the records of the
company for a period of five years from the dissolution of
the company, after which they may be destroyed.
Kingsway Property's shareholders agreed on March 18, 2008, to
place the company into voluntary liquidation under The Companies
Law (2004 Revision) of the Cayman Islands.
The liquidators can be reached at:
John Cullinane and Derrie Boggess
c/o Walkers SPV Limited
Walker House, 87 Mary Street
George Town, Grand Cayman KY1-9002
Cayman Islands
KOYAH MICROCAP: Will Hold Final Shareholders Meeting on May 2
-------------------------------------------------------------
Koyah Microcap Partners, Ltd., will hold its final shareholders
meeting on May 2, 2008, at 1:15 p.m. at the company's registered
office.
These matters will be taken up during the meeting:
-- receiving an account showing the manner in which
the winding-up of the company has been conducted
and its property disposed of and hearing any
explanation that may be given by the liquidator; and
-- authorizing the liquidators to retain the records of the
company for a period of five years from the dissolution of
the company, after which they may be destroyed.
Koyah Microcap's shareholders agreed on March 20, 2008, to place
the company into voluntary liquidation under The Companies Law
(2004 Revision) of the Cayman Islands.
The liquidators can be reached at:
John Cullinane and Derrie Boggess
c/o Walkers SPV Limited
Walker House, 87 Mary Street
George Town, Grand Cayman KY1-9002
Cayman Islands
MIYAKODORI CAPITAL: To Hold Final Shareholders Meeting on May 2
---------------------------------------------------------------
Miyakodori Capital Corporation will hold its final shareholders
meeting on May 2, 2008, at 12:00 p.m. at the office of the
company.
These matters will be taken up during the meeting:
-- receiving an account showing the manner in which
the winding-up of the company has been conducted
and its property disposed of and hearing any
explanation that may be given by the liquidator; and
-- authorizing the liquidators to retain the records of the
company for a period of five years from the dissolution of
the company, after which they may be destroyed.
Miyakodori Capital's shareholders agreed on March 14, 2008, to
place the company into voluntary liquidation under The Companies
Law (2004 Revision) of the Cayman Islands.
The liquidators can be reached at:
John Cullinane and Derrie Boggess
c/o Walkers SPV Limited
Walker House, 87 Mary Street
George Town, Grand Cayman KY1-9002
Cayman Islands
ML OAK: Sets Final Shareholders Meeting for May 2
-------------------------------------------------
ML Oak (Cayman) will hold its final shareholders meeting on
May 2, 2008, at 9:30 a.m. at the office of the company.
These matters will be taken up during the meeting:
-- receiving an account showing the manner in which
the winding-up of the company has been conducted
and its property disposed of and hearing any
explanation that may be given by the liquidator; and
-- authorizing the liquidators to retain the records of the
company for a period of five years from the dissolution of
the company, after which they may be destroyed.
ML Oak's shareholders agreed on March 10, 2008, to place the
company into voluntary liquidation under The Companies Law (2004
Revision) of the Cayman Islands.
The liquidators can be reached at:
John Cullinane and Derrie Boggess
c/o Walkers SPV Limited
Walker House, 87 Mary Street
George Town, Grand Cayman KY1-9002
Cayman Islands
PEQUOT INDIA: Sets Final Shareholders Meeting for May 2
-------------------------------------------------------
Pequot India Cayman III, Ltd., will hold its final shareholders
meeting on May 2, 2008, at 12:30 p.m. at the company's
registered office.
These matters will be taken up during the meeting:
-- receiving an account showing the manner in which
the winding-up of the company has been conducted
and its property disposed of and hearing any
explanation that may be given by the liquidator; and
-- authorizing the liquidators to retain the records of the
company for a period of five years from the dissolution of
the company, after which they may be destroyed.
Pequot India's shareholders agreed on March 19, 2008, to place
the company into voluntary liquidation under The Companies Law
(2004 Revision) of the Cayman Islands.
The liquidators can be reached at:
John Cullinane and Derrie Boggess
c/o Walkers SPV Limited
Walker House, 87 Mary Street
George Town, Grand Cayman KY1-9002
Cayman Islands
SUNDAY SILENCE: Sets Final Shareholders Meeting for May 2
---------------------------------------------------------
Sunday Silence Limited will hold its final shareholders meeting
on May 2, 2008, at 11:30 a.m. at the office of the company.
These matters will be taken up during the meeting:
-- receiving an account showing the manner in which
the winding-up of the company has been conducted
and its property disposed of and hearing any
explanation that may be given by the liquidator; and
-- authorizing the liquidators to retain the records of the
company for a period of five years from the dissolution of
the company, after which they may be destroyed.
Sunday Silence's shareholders agreed on March 14, 2008, to place
the company into voluntary liquidation under The Companies Law
(2004 Revision) of the Cayman Islands.
The liquidators can be reached at:
John Cullinane and Derrie Boggess
c/o Walkers SPV Limited
Walker House, 87 Mary Street
George Town, Grand Cayman KY1-9002
Cayman Islands
TF CAPITAL: Will Hold Final Shareholders Meeting on May 2
---------------------------------------------------------
T.F. Capital Corporation will hold its final shareholders
meeting on May 2, 2008, at Maples Finance Limited, Boundary
Hall, Cricket Square, George Town, Grand Cayman, Cayman Islands.
These matters will be taken up during the meeting:
-- receiving an account showing the manner in which
the winding-up of the company has been conducted
and its property disposed of and hearing any
explanation that may be given by the liquidator; and
-- giving any explanation thereof.
T.F. Capital's shareholders agreed on March 17, 2008, to place
the company into voluntary liquidation under The Companies Law
(2004 Revision) of the Cayman Islands.
The liquidator can be reached at:
Daniel Rewalt
Maples Finance Limited
P.O. Box 1093, George Town
Grand Cayman, Cayman Islands
YILONG MEDIA: Proofs of Claim Filing Deadline Is Today
------------------------------------------------------
Yilong Media Group Limited's creditors have until
April 30, 2008, to prove their claims to Christopher S. Justice,
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.
Yilong Media's shareholders agreed on March 14, 2008, to place
the company into voluntary liquidation under The Companies Law
(2004 Revision) of the Cayman Islands.
The liquidator can be reached at:
Christopher S. Justice
c/o Messrs. Maples and Calder
Attorneys-at-law
P.O. Box 309, Ugland House
Grand Cayman KY1-1104, Cayman Islands
=========
C H I L E
=========
BUCYRUS INT'L: Earns US$41.1 Million in Quarter Ended March 31
--------------------------------------------------------------
Bucyrus International Inc. disclosed its summary unaudited
financial results for the quarter ended March 31, 2008.
Operating Results
The overall increase in surface mining sales was attributable to
the strong global demand for Bucyrus' products and services,
which continues to be driven by high international commodity
prices and strong markets for commodities mined by Bucyrus
machines. Surface mining original equipment sales for the first
quarter of 2008 increased in all three product lines compared to
the first quarter of 2007. Surface mining aftermarket parts and
service sales for the first quarter of 2008 increased in nearly
all worldwide markets compared to the first quarter of 2007.
The expansion of Bucyrus' South Milwaukee, Wisconsin surface
mining facilities was substantially complete as of March 31,
2008, which will allow for annual shovel production capacity of
24 machines and almost doubled manufactured parts capacity from
2006 levels. Underground mining sales for the first quarter of
2008 decreased from the third and fourth quarters of 2007
primarily due to the timing of new orders in 2007.
Gross profit for the first quarter of 2008 was US$141.6 million,
or 27.4% of sales, compared to US$52.1 million, or 27.4% of
sales, for the first quarter of 2007. Gross profit for the
first quarter of 2008 was reduced by US$8.7 million of
amortization of purchase accounting adjustments as a result of
the acquisition of DBT in 2007, which had the effect of reducing
gross margin for the first quarter of 2008 by 1.7 percentage
points. The increase in gross profit was primarily due to the
acquisition of DBT and increased surface mining sales. For the
first quarter of 2008, gross margins on surface mining original
equipment and aftermarket parts and services were improved from
the first quarter of 2007; however, overall gross margin was
negatively impacted by the sales mix of lower margin original
equipment and higher margin aftermarket parts and services.
Gross margin on underground mining equipment for the first
quarter of 2008 was improved from the last two quarters of 2007
primarily due to 2008 sales consisting of a larger percentage of
higher margin aftermarket parts and services.
Selling, general and administrative expenses for the first
quarter of 2008 were US$59.5 million, or 11.5% of sales,
compared to US$21.1 million, or 11.1% of sales, for the first
quarter of 2007. This increase was primarily due to the
acquisition of DBT.
The increase in operating earnings for the first quarter of 2008
was primarily due to the acquisition of DBT and increased gross
profit resulting from increased surface mining sales volume.
Operating earnings for underground mining operations were
reduced by purchase accounting adjustments related to the
acquisition of DBT of US$14.3 million for the first quarter of
2008.
Net interest expense for the first quarter of 2008 was US$5.9
million compared to US$1.2 million for the first quarter of
2007. The increase in net interest expense in 2008 was due to
increased debt levels related to the financing of the
acquisition of DBT.
Net earnings for the first quarter of 2008 were US$41.1 million,
or US$1.11 per share, compared to US$17.9 million, or US$0.57
per share, for the first quarter of 2007.
Capital expenditures the first quarter of 2008 were US$21.2
million, which included US$7.5 million related to Bucyrus'
expansion of its South Milwaukee facilities. At Bucyrus' Annual
Meeting of Stockholders held last week, Chief Executive Officer
Tim Sullivan reaffirmed that the Board of Directors had
previously approved an additional US$45 million for the
completion of renovations at Bucyrus' South Milwaukee, Wisconsin
facility. Bucyrus' capital expenditures for 2008 are expected to
be between US$90 million and US$100 million, including this
expenditure.
Backlog as of March 31, 2008 and December 31, 2007, as well as
the portion of backlog which is expected to be recognized within
12 months of these dates, was:
March 31, December 31,
2008 2007 % Change
----------- ------------- ---------
(Dollars in thousands)
Surface mining:
Total US$1,136,222 US$804,781 41.2%
Next 12 months US$741,557 US$579,448 28.0%
Underground mining:
Total US$881,042 US$636,473 38.4%
Next 12 months US$744,013 US$551,923 34.8%
Total:
Total US$2,017,264 US$1,441,254 40.0%
Next 12 months US$1,485,570 US$1,131,371 31.3%
A portion of the surface mining backlog as of March 31, 2008 and
December 31, 2007 was related to multi-year contracts that will
generate revenue in future years.
New orders related to surface mining operations for the first
quarter of 2008 were US$260.8 million and US$354.7 million for
original equipment and aftermarket parts and service sales,
respectively. Included in surface mining aftermarket parts and
service new orders was US$209.8 million related to multi-year
contracts that will generate revenue in future years. New
orders related to underground mining operations for the first
quarter of 2008 were US$353.1 million and US$124.4 million for
original equipment and aftermarket parts and service sales,
respectively.
About Bucyrus International
Headquartered in South Milwaukee, Wisconsin, Bucyrus
International Inc. (Nasdaq: BUCY) -- http://www.bucyrus.com/--
is a global manufacturer of electric mining shovels, walking
draglines and rotary blasthole drills and provides aftermarket
replacement parts and services for these machines. In 2006, it
had sales of USUS$738 million. The company has operations in
Brazil, Chile, China, Poland, the United Kingdom, Australia,
India, Germany and Peru, among others.
* * *
Moody's Investor Service placed the company's long-term
corporate family rating at 'Ba3' in April 2007. The rating
still holds to date with a stable outlook.
===============
C O L O M B I A
===============
BANCOLOMBIA: Board Authorizes VP to Sell COP144 Million Shares
--------------------------------------------------------------
The Board of Directors of Bancolombia S.A. authorized Vice
President of Operations Luis Fernando Montoya Cusso to give
notice to Fiduciaria Helm Trust S.A. for the sale of Mr. Montoya
Cusso's units in a share portfolio (Cartera Colectiva con Pacto
de Permanencia Acciones Sistema Valor Agregado) managed by such
company. The units have an approximate value of COP144 million
(approximately US$82,041). The units represent shares of
Bancolombia.
Bancolombia S.A. is Colombia's largest full-service financial
institution, formed by a merger of three leading Colombian
financial institutions. Bancolombia's market capitalization is
over US$5.5 billion, with US$13.8 billion asset base and US$1.4
billion in shareholders' equity as of Sept. 30, 2006.
Bancolombia is the only Colombian company with an ADR level III
program in the New York Stock Exchange.
* * *
As reported in the Troubled Company Reporter-Latin America on
June 27, 2007, Moody's Investors Service changed the outlook to
positive from stable on its Ba3 long-term foreign currency
deposit ratings and Ba1 long-term foreign currency subordinated
bond rating for Bancolombia, S.A.
BRIGHTPOINT INC: Subsidiary Acquires Hugh Symons Business
---------------------------------------------------------
Brightpoint Inc.'s wholly-owned subsidiary, Brightpoint Great
Britain Limited, has acquired the Hugh Symons Group Ltd.'s
wireless distribution business. Brightpoint Great Britain Ltd.
acquired the assets in exchange for GBP294,000 (approximately
US586,000) and the value of inventory at date of closing. In
addition, Brightpoint agreed to contingent cash earn out
payments based upon certain operating performance measures which
may be payable on the 1st, 2nd and 3rd anniversary of closing.
The total earn out payments shall in no event exceed GBP3.6
million (approximately US7.2 million).
Mr. Hugh Roper and other key former members of Hugh Symons Group
Ltd.'s wireless distribution business will join Brightpoint
Great Britain Ltd. and will continue to be involved with the
management and operation of the business.
"The acquisition will strengthen our position in Europe," stated
Steen F. Pedersen, President for Brightpoint Europe. "We have
been looking for an opportunity to enter the UK market for the
past few years. We believe that we have found the right
opportunity. Hugh Symons Group Ltd. has been developing the
smart phone market in UK, which is an important element of our
growth strategy. Additionally, we want Hugh Roper and his team
to further expand the business with other Brightpoint models
like the customized logistic services model."
"I believe that the ownership of Brightpoint gives us huge
opportunities in UK," stated Hugh Roper, Managing Director and
sole-shareholder of Hugh Symons Group Ltd. "I am convinced that
our UK team together with the knowledge and competences from
Brightpoint will be a powerful platform for further development
of the business. I am looking forward to develop Brightpoint
Great Britain Ltd. into a full-blown value adding distributor
and logistic provider."
Headquartered in Plainfield, Indiana, Brightpoint, Inc. --
http://www.brightpoint.com/-- distributes wireless devices and
accessories, as well as provision of customized logistic
services to the wireless industry. The company primarily
operates in Australia, Colombia, Finland, Germany, India, New
Zealand, Norway, the Philippines, the Slovak Republic, Sweden,
United Arab Emirates and the United States. The company's
customers include mobile operators, mobile virtual network
operators, resellers, retailers and wireless equipment
manufacturers. Brightpoint was incorporated in 1989 under the
name Wholesale Cellular USA, Inc. and changed its name to
Brightpoint Inc. in 1995.
* * *
On April 12, 2006, Standard & Poor's placed Brightpoint's long-
term local and foreign issuer credit ratings at BB- with a
stable outlook.
GLOBAL CROSSING: Gets SAP Colombia/Brazil Hosting Certification
---------------------------------------------------------------
Global Crossing Ltd. has received a hosting certification from
SAP AG for its ability to deliver high-quality hosting services
from its data center operations. This brings to four the number
of countries in Latin America where Global Crossing is a
certified SAP hosting partner. It has been certified by SAP in
Argentina and Chile since 2005.
SAP granted the accreditation to Global Crossing after the
company successfully met a rigorous review process that assessed
the company's infrastructure, processes and technical staff. By
becoming a certified SAP hosting partner, Global Crossing is
fully compliant with SAP's requirements for quality,
availability and security.
"This certification underscores Global Crossing's commitment to
providing world-class communications and IT services to our
customers, based on the industry's best practices," said Global
Crossing's vice president of data center services EMEA and
global product manager, Gabriel del Campo. "We are now able to
manage, host and implement SAP applications for our customers in
strategic markets in Latin America."
Every two years, all SAP hosting partners go through a review
process to evaluate their compliance with requirements for
service delivery, incident management capabilities, support and
information availability, as well as customer relationship.
The accreditation Global Crossing received in Colombia and
Brazil applies to the company's application and implementation
hosting services. Application hosting includes the operation
and maintenance of an application in a data center, as well as
the complete hosting services portfolio for the SAP Business
Suite, which includes infrastructure, implementation, operations
and support. Implementation hosting covers the implementation
of SAP solutions, ranging from complete solution implementation
to incorporation of new functionality for a solution that is
already installed.
"With this certification we're enhancing the value-added ICT
solutions we offer to the corporate market," added Mr. del
Campo. "Global Crossing's solutions integrate a global network,
world-class data center infrastructure and managed services."
Information and Communications Technology (ICT) is an umbrella
term used to acknowledge the convergence of the information
technology and communications industries.
About Global Crossing Ltd.
Headquartered in Florham Park, New Jersey, Global Crossing Ltd.
(NASDAQ: GLBC) -- http://www.globalcrossing.com/-- provides
telecommunication services over the world's first integrated
global IP-based network. Global Crossing serves many of the
world's largest corporations, providing a full range of managed
data and voice products and services. The company filed for
chapter 11 protection on Jan. 28, 2002 (Bankr. S.D.N.Y. Case No.
02-40188). When the Debtors filed for protection from their
creditors, they listed US$25,511,000,000 in total assets and
US$15,467,000,000 in total debts. Global Crossing emerged from
chapter 11 on Dec. 9, 2003.
Global Crossing's Latin American business has operations in
Argentina, Brazil, Chile, Colombia, Ecuador, Panama, Peru,
Mexico, Venezuela and the United States (Florida). It also has
operations in the United Kingdom.
* * *
At Sept. 30, 2007, Global Crossing Ltd.'s balance sheet showed
total assets of US$2.6 billion, total debts of US$2.7 billion
and a US$74 million stockholders' deficit.
As reported in the Troubled Company Reporter-Latin America on
Nov. 8, 2007, Global Crossing Ltd. said in a statement that its
net loss increased 75% to US$89 million in the third quarter
2007, compared to US$51 million in the third quarter 2006.
==================
C O S T A R I C A
==================
ALCATEL-LUCENT: Says Spectrum & Handsets to Help WiMax in LatAm
---------------------------------------------------------------
Alcatel-Lucent's President for Caribbean and Latin American
Operations, Victor Agnellini, told Business News Americas that
the availability of spectrum and handsets will be the "key" if
mobile WiMax will have a future in Latin America.
According to BNamericas, Mr. Agnellini disagrees with
assumptions that have been made by certain companies that
"operators will choose to leverage the existing mobile
communications infrastructure to offer mobile data services,
rather than build a completely new network."
Mr. Agnellini commented to BNamericas, "I think it is pretty
early to tell if that will or will not be the case. I think
that certainly penetration in the mobility space is reaching
strong levels in Latin America. There is still room for growth
but the penetration of voice services is reaching saturation
point. So you have a chance to start proving the business case
for deploying those networks, not yet in the mobility side but
you can prove it doing broadband access of a nomadic nature and
really target it more for data users than voice users."
Mr. Agnellini told BNamericas that "there is much interest to
see what happens with the 700 megahertz band. Bandwidth in the
850 megahertz and 1900 megahertz bands "is going to reach
saturation" in Latin America in up to years, Mr. Agnellini
added.
BNamericas relates that Mr. Agnellini said there is a need for
handsets that are more data centric that treat voice as part of
data and handsets that designed chiefly for voice.
Mr. Agnellini commented to BNamericas, "It isn't clear that
there is no play [for mobile WiMax]. I think there is a
potential opportunity there but it is going to depend mainly on
the availability and price of the mobile devices, from my
perspective."
Headquartered in Paris, France, Alcatel-Lucent S.A. --
http://www.alcatel-lucent.com/-- provides solutions that enable
service providers, enterprises and governments worldwide to
deliver voice, data and video communication services to end
users.
Alcatel-Lucent maintains operations in 130 countries, including,
Austria, Germany, Hungary, Italy, Netherlands, Ireland, Canada,
United States, Costa Rica, Dominican Republic, El Salvador,
Guatemala, Peru, Venezuela, Indonesia, Australia, Brunei and
Cambodia.
* * *
As reported on April 4, 2008, Moody's Investors Service affirmed
the ratings for Alcatel-Lucent, which include a Ba3 corporate
family rating for Alcatel-Lucent and a Not-Prime for its short
term debt, as well as Ba3 ratings for senior and B2 ratings for
subordinated debt that was issued originally by the predecessor
companies Alcatel S.A. and Lucent Technologies, Inc. Moody's
said the outlook for the ratings is Negative.
Alcatel-Lucent's Long-Term Corporate Credit rating and Senior
Unsecured Debt carry Standard & Poor's Ratings Services' BB
rating. Its Short-Term Corporate Credit rating stands at B.
SIRVA INC: Files Motion to Modify Plan Without Resolicitation
-------------------------------------------------------------
Sirva Inc. and its debtor-affiliates seek permission from the
U.S. Bankruptcy Court for the Southern District of New York to
make immaterial modifications to their Prepackaged Joint Plan of
Reorganization pursuant to Section 1127 of the Bankruptcy Code,
without the need to resolicit votes.
The Debtors' Plan classifies unsecured claims arising from the
ongoing business relationships separately from those claims that
provide no corresponding benefit to the Debtors' businesses,
their estates, or their other creditors, Marc Kieselstein, P.C.,
at Kirkland and Ellis LLP in Chicago, Illinois, explained.
Specifically, he said, claims arising from ongoing business
relationships are classified as Class 4 claims and will be paid
in full, despite the fact that the Debtors' Prepetition Lenders
stand to receive no more than 40 cents on the dollar, in second
lien paid-in-kind debt and equity, based on the Debtors' most
recent valuation.
The Debtors believe the distributions to Class 4 creditors --
which are gifts from the Prepetition Lenders -- will preserve
the value of the Debtors' businesses going forward. The
Prepetition Lenders support the Debtors' determination, said Mr.
Kieselstein.
Conversely, claims unrelated to the ongoing business
relationships, or otherwise do not contribute to the goodwill of
the business, are classified as Class 5 claims, entitled to
receive no distribution. The Class 5 claims were identified
through the Debtors' schedules of assets and liabilities.
Mr. Kieselstein noted that since majority of the Debtors'
unsecured creditors do not hold Class 5 claims, the Plan rescues
almost all of the Debtors' unsecured creditors, as a result of
negotiations with the Debtors' Prepetition Lenders. However,
the Plan has been opposed by certain Class 5 claimants, with
respect to the classification and treatment accorded to Class 5.
The Debtors continue to believe that the Plan satisfies the
requirements of the Bankruptcy Code necessary for confirmation,
but have modified the Plan to provide certain distributions on
account of Class 5 Claims, said Mr. Kieselstein.
In addition, the Debtors have finalized certain financing terms,
which were disclosed at the time of the Debtors' original
solicitation. Thus, the revised and final terms of the exit
financing are not modifications, but an effectuation of a
process consistent with the Plan, Mr. Kieselstein explained.
To the extent the developments are viewed as "modifications,"
Mr. Kieselstein assured the Court that these are immaterial and
non-adverse for purposes of resolicitation. In fact, he said,
the changes enhance the value of the businesses for the benefit
of all voting creditors -- the Debtors' Prepetition Lenders.
The Debtors proposed these revisions:
* the terms of the Second Lien Facility have been modified to
reduce indebtedness under the Second Lien Facility by
US$50,000,000, increasing the value of the stock distributed
to the Prepetition Lenders;
* the terms of the New Credit Facility have been modified to
provide the New Credit Facility Lenders with an additional
350 basis points in PIK interest per annum;
* the Plan's definition of "general unsecured claim" has been
clarified by including specific reference to the Class 5
declarations;
* Class 5 claimants will receive a beneficial, pro rata
interest in an unsecured note of US$3,500,000 notional
value, in final satisfaction of each allowed Class 5 claim;
* the US$3,500,000 unsecured note will be on substantially the
same economic terms as the Prepetition Lenders will receive
under the Second Lien Facility, but will be junior to
the Second Lien Facility; and
* the Debtors have also made various technical, immaterial,
and conforming changes to the Plan.
According to Mr. Kieselstein, the modifications implemented
through Rule 3019 of the Federal Rules of Bankruptcy Procedure
do not require resolicitation, where the court determines that
they do not adversely change the treatment of any claim or the
interest of any equity security holder that has not accepted the
modification. Mr. Kieselstein said the modifications may be
proposed in a shortened time period in advance of confirmation,
and a hearing on the proposed modification may be combined with
a confirmation hearing.
Mr. Kieselstein maintained that the Plan, as revised, does not
adversely affect any creditor. The revised exit financing terms
were contemplated and disclosed in the original solicitation
package delivered to the Debtors' Prepetition Lenders.
Additionally, the proposed distributions to Class 5 creditors is
not materially adverse to the Prepetition Lenders, he said. The
Debtors' Plan provides their Prepetition Lenders with
US$150,000,000 in second lien debt, and approximately 75% of the
equity in the Reorganized Debtors.
Mr. Kieselstein explained that although the US$3,500,000
unsecured note represents a significant recovery to Class 5
claimants, this does not materially reduce the recovery
otherwise available to the Prepetition Lenders. The unsecured
note is approximately 2% of the credit portion of the
Prepetition Lenders' recovery.
Consequently, the Debtors submit that the proposed distribution
does not constitute a materially adverse modification under Rule
3019, and will even provide a meaningful recovery of on account
of Class 5 claims.
A blacklined copy of the Second Amended Plan with Technical
Modifications is available at no charge at:
http://bankrupt.com/misc/SIRVAPlanImmaterialModifications.pdf
Committee Demands Resolicitation
The Official Committee of Unsecured Creditors said the proposed
changes to the Plan require the Debtors to send its Plan back to
creditors for voting, reported David McLaughlin of Dow Jones
Newswires.
The Committee complained that the last-minute changes were
unfair, since they prepared for the hearing using the Debtors
original Plan, said Mr. McLaughlin.
Debtors Answer Back
The Debtors opposed the Committee's request saying they can't
afford to spend more time in bankruptcy.
Counsel for the Debtors, Mr. Kieselstein, argued that the
modified plan does not need to be voted on, since the creditors
getting the note would have been wiped out under the original
plan.
"There's no downside," Mr. Kieselstein said. "There's no impact
whatsoever on their treatment."
Headquartered in Westmont, Illinois, SIRVA Inc. (Pink Sheets :
SIRV.PK) -- http://www.sirva.com/-- is a provider of relocation
solutions to a well-established and diverse customer base. The
company handles all aspects of relocation, including home
purchase and home sale services, household goods moving,
mortgage services and home closing and settlement services.
SIRVA conducts more than 300,000 relocations per year,
transferring corporate and government employees along with
individual consumers. SIRVA's brands include Allied, Allied
International, Allied Pickfords, Allied Special Products, DJK
Residential, Global, northAmerican, northAmerican International,
Pickfords, SIRVA Mortgage, SIRVA Relocation and SIRVA
Settlement. The company has operations in Costa Rica.
The company and 61 of its affiliates filed separate petitions
for Chapter 11 protection on Feb. 5, 2008 (Bankr. S.D.N.Y. Case
No. 08-10433). Marc Kieselstein, Esq. at Kirkland & Ellis,
L.L.P. is representing the Debtor. An official Committee of
Unsecured Creditors has been appointed in this case. When the
Debtors filed for bankruptcy, it reported total assets of
US$924,457,299 and total debts of US$1,232,566,813 for the
quarter ended Sept. 30, 2007.
(Sirva Inc. Bankruptcy News, Issue No. 12; Bankruptcy Creditors'
Services Inc. http://bankrupt.com/newsstand/or 215/945-7000).
US AIRWAYS: Sets Executive Incentive Plan Targets for 2008
----------------------------------------------------------
Janet Dhillon, senior vice president and general counsel of US
Airways, Inc., disclosed in a regulatory filing with the U.S.
Securities and Exchange Commission, the company's incentive
compensation plan targets for 2008.
According to Ms. Dhillon, executives and other key management
employees of US Airways Group, Inc., and its subsidiaries, are
eligible to participate in an annual incentive program
administered under US Airways' Incentive Compensation Plan.
On March 31 of each year, the company's Compensation and Human
Resources Committee of the Board of Directors, must establish
performance targets that will be used to determine incentive
awards for the year.
The Committee also establishes target incentive award amounts as
a percentage of base salary for each participant. If the
performance targets are met at the maximum level, the Committee
may approve payouts at 200% of the target award amounts, Ms.
Dhillon states.
The Committee may also adjust each individual's payment amount
in its discretion based on individual performance. However, any
adjustment may not result in an individual's payment exceeding
200% of the target award.
After Committee approval, the incentive awards are paid as lump-
sum cash distributions as soon as practicable after the end of
the plan year.
According to Ms. Dhillon, US Airways' "named executive
officers,"which currently consist of W. Douglas Parker, J. Scott
Kirby, Derek J. Kerr, Elise R. Eberwein and C.A. Howlett, are
eligible to participate in the Incentive Compensation Plan. US
Airways' chief operating officer Robert Isom, who became an
officer of the company in September 2007, also participates in
the program, as do other executives of the company.
In addition, the Compensation Committee of the BOD established
on March 28, 2008:
(1) corporate financial performance targets based on
designated minimum levels of pre-tax income for fiscal
year 2008;
(2) operational performance targets based on (a) a peer-group
comparison of on-time flight performance and (b) baggage
handling improvements from 2007; and
(3) bonus pool amounts, based on the extent to which the
corporate financial performance targets and the
operational performance targets are met, for determining
the total amount to be allocated among participants under
the Incentive Compensation Plan for 2008.
The Committee established 2008 target incentive awards as 100%
of base salary for the Chief Executive Officer, 80% of base
salary for the President, 80% of base salary for the Executive
Vice Presidents and 60% of base salary for the Senior Vice
Presidents.
If one or more of the performance targets are met, the Committee
will determine an incentive award amount for each individual
based on the individual's target incentive award amount, the
level of achievement of the performance targets, the total bonus
pool amount available and individual performance.
The awards are weighted 50% to the corporate financial
performance targets and 50% to the operational performance
targets. The operational performance targets are weighted 67%
to peer-group on-time flight performance and 33% to baggage
handling improvements from 2007. If the corporate financial
performance targets are not met, the potential award
automatically will be reduced by 50%.
If the peer-group on-time flight performance is not met, the
potential award amount automatically will be reduced by 33.5%.
If the baggage handling improvements from 2007 are not met, the
potential award amount automatically will be reduced by 16.5%.
If the corporate financial performance targets and both of the
operational performance targets are not met, then no awards will
be paid.
In no event will the aggregate amount of awards paid out to the
participants exceed the established bonus pool.
The Committee has also reserved the right to decrease the awards
or to make no payment of an award in its discretion, regardless
of the attainment of the corporate financial targets.
2008 Long Term Incentive Program
The Compensation Committee of the BOD also established the 2008
Long Term Incentive Program, which sets forth the terms and
conditions for performance cash awards to be paid to US Airways'
officers, including the executive officers, under the US Airways
Group, Inc. 2005 Equity Incentive Plan.
The awards under the program are calculated based on their total
stockholder return over a three-year performance cycle beginning
January 1, 2008 and ending December 31, 2010, relative to the
TSRs of a pre-defined competitive peer group for the period.
Cash awards would be paid out as a percentage of base salary
based on the relative TSR rank, provided that a threshold level
is reached.
For determining the cash awards under the program, the
Compensation Committee of the BOD adopted a peer group
consisting of: AirTran Holdings, Inc., Alaska Air Group, Inc.,
AMR Corporation -- the parent company of American Airlines,
Continental Airlines, Inc., Delta Air Lines, Inc., Frontier
Airlines Holdings, Inc., Hawaiian Holdings, Inc., -- the parent
company of Hawaiian Airlines, JetBlue Airways Corporation,
Northwest Airlines Corporation, Southwest Airlines Co. and UAL
Corporation -- the parent company of United Air Lines.
In addition, the Compensation Committee of the BOD approved the
award pay-out schedule for the 2008-2010 performance cycle:
Company TSR
Relative
Rank Payout as a % of Base Salary
----------- -----------------------------------
SVP EVP President CEO
1-2 of 12 140% 175% 200% 200% (Maximum)
3 of 12 122.5% 156.25% 178.75% 181.25%
4 of 12 105% 137.5% 157.50% 162.50%
5 of 12 87.5% 118.75% 136.25% 143.75%
6 of 12 70% 100% 115% 125% (Target)
7 of 12 50% 71.5% 82% 89.50%
8 of 12 30% 43% 49% 54% (Threshold)
9-12 of 12 0% 0% 0% 0%
About US Airways
Based in Tempe, Arizona, US Airways Group Inc.'s (NYSE: LCC) -
http://www.usairways.com/-- primary business activity is the
ownership of the common stock of US Airways, Inc., Allegheny
Airlines, Inc., Piedmont Airlines, Inc., PSA Airlines, Inc.,
MidAtlantic Airways, Inc., US Airways Leasing and Sales, Inc.,
Material Services Company, Inc., and Airways Assurance Limited,
LLC.
US Airways has operations in Japan, Australia, China, Costa
Rica, Philippines, and Spain, among others.
Under a Chapter 11 plan declared effective on March 31, 2003,
USAir emerged from bankruptcy with the Retirement Systems of
Alabama taking a 40% equity stake in the deleveraged carrier in
exchange for US$240 million infusion of new capital.
US Airways and its subsidiaries filed another chapter 11
petition on Sept. 12, 2004 (Bankr. E.D. Va. Case No. 04-13820).
Brian P. Leitch, Esq., Daniel M. Lewis, Esq., and Michael J.
Canning, Esq., at Arnold & Porter LLP, and Lawrence E. Rifken,
Esq., and Douglas M. Foley, Esq., at McGuireWoods LLP, represent
the Debtors in their restructuring efforts. In the Company's
second bankruptcy filing, it lists US$8,805,972,000 in total
assets and US$8,702,437,000 in total debts.
The Debtors' Chapter 11 plan for its second bankruptcy filing
became effective on Sept. 27, 2005. The Debtors completed their
merger with America West on the same date. (US Airways
Bankruptcy News, Issue No. 158; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).
* * *
As reported in the Troubled Company Reporter-Latin America on
March 27, 2008, Standard & Poor's Ratings Services revised its
outlook on US Airways Group Inc. to stable from positive. S&P
has affirmed all ratings, including the 'B-' long-term corporate
credit rating.
The TCR-LA reported on April 18, 2008, that Fitch Ratings has
affirmed the debt ratings of US Airways Group, Inc. as: Issuer
Default Rating at 'B-'; Secured term loan rating at 'BB-/RR1';
and Senior unsecured rating at 'CCC/RR6'. Fitch's ratings apply
to approximately US$1.7 billion in outstanding debt. The Rating
Outlook has been revised to Stable from Positive.
US AIRWAYS: Reaches Tentative Three-Year Agreement With IAM
-----------------------------------------------------------
US Airways Group Inc. and the International Association of
Machinists and Aerospace Workers (IAM) District 142 announced a
tentative agreement on a single contract for the airline's 40
maintenance training instructors. Also, US Airways and IAM
District 141 announced they have reached a tentative agreement
on a single contract for the airline's 7,700 ramp and baggage
handling employees.
Tentative Agreement for Trainors
The tentative three-year agreement for training instructors,
which is subject to ratification, establishes new wages and
other improvements. It would become amendable on Dec. 31, 2011.
The IAM is releasing details of the agreement, and a
ratification vote schedule has not yet been set.
"An important goal for our airline is to move all represented
employees to single labor contracts, and we are extremely
pleased that we have completed this third agreement with the
IAM. We appreciate the work of the IAM negotiators, and our
company negotiating committee led by VP-Labor Relations Al
Hemenway, in achieving this tentative agreement," said Doug
Parker, Chairman and CEO of US Airways.
Tentative Agreement for Baggage Handlers
The tentative agreement for ramp and baggage handlers, which is
subject to ratification, establishes new wages and makes other
improvements for the airline's baggage handlers and ramp
personnel.
The IAM is releasing details of the agreement April 11. A
ratification vote schedule has not yet been set. The new
agreement becomes amendable on Dec. 31, 2011.
"[The] announcement moves us even closer to our goal of bringing
all of our represented work groups to single labor agreements,
and we appreciate the hard work of our company and union
negotiators to achieve this tentative agreement," said Mr.
Parker.
Vice President, Labor Relations Mr. Hemenway added, "We are
extremely pleased to have reached a mutually beneficial
tentative agreement that recognizes the contributions and
efforts of our fleet service employees."
The IAM also represents US Airways' maintenance and related
employees, and just yesterday announced that mechanics in IAM
District 142 had ratified a new agreement that expires at the
end of 2011. US Airways has reached prior unified agreements
with the CWA/IBT, which represents the airline's reservations
agents and passenger service employees; and with the Transport
Workers Union, representing flight dispatchers, instructors and
engineers.
US Airways and Mechanics Ratify Contract
US Airways mechanics represented by IAM District 142 ratified a
three-year agreement that moves all US Airways' maintenance-and-
related employees to one labor contract. The new agreement
provides annual wage increases, job security and new pension
benefits for all members, and becomes amendable on Dec. 31,
2011.
The IAM mechanics' agreement, covering approximately 3,300
maintenance-and-related employees (800 West and 2,500 East), is
the latest unified contract achieved at the new US Airways since
its merger with America West in 2005.
Mr. Parker said, "We're extremely pleased that our employees
have endorsed this new agreement. I applaud the IAM leadership,
led by District 142 president and directing general chairman Tom
Higginbotham, and our own team, led by Vice President, Labor
Relations, Al Hemenway, for their efforts to reach an agreement
that is fair and recognizes the contributions of our maintenance
team."
IAM's Statement
IAM announced the ratification of a collective bargaining
agreement covering 3,300 Mechanic & Related employees at US
Airways.
"District Lodge 142 and the Negotiating Committee performed an
excellent job under the most difficult of circumstances," said
IAM General Vice President Robert Roach, Jr. "I thank the
membership for their full support. Without them, this agreement
would not have been possible."
The agreement, which will be effective through Dec. 31, 2011,
was ratified by 65 percent of the voting membership.
"Our members approved an agreement that provides higher wages, a
sound pension and enhanced job security," said Mr. Higginbotham.
"This agreement allows all US Airways Mechanic & Related
employees to work under a single agreement for the first time
since the America West merger."
Highlights of the agreement include base wage and license
premium increases, improved overtime rates, new shift premiums
and participation in the IAM National Pension Plan, a secure
multi-employer pension plan.
The Machinists Union is the largest Airline and Rail Union in
North America, representing more than 170,000 Flight Attendants,
Customer Service Agents, Reservation Agents, Ramp Service
Personnel, Mechanics, Railroad Machinists and related
transportation industry workers.
Additional information about the Machinists Union is available
at http://www.goiam.org/transportation/
About US Airways
Based in Tempe, Arizona, US Airways Group Inc.'s (NYSE: LCC) -
http://www.usairways.com/-- primary business activity is the
ownership of the common stock of US Airways, Inc., Allegheny
Airlines, Inc., Piedmont Airlines, Inc., PSA Airlines, Inc.,
MidAtlantic Airways, Inc., US Airways Leasing and Sales, Inc.,
Material Services Company, Inc., and Airways Assurance Limited,
LLC.
US Airways has operations in Japan, Australia, China, Costa
Rica, Philippines, and Spain, among others.
Under a Chapter 11 plan declared effective on March 31, 2003,
USAir emerged from bankruptcy with the Retirement Systems of
Alabama taking a 40% equity stake in the deleveraged carrier in
exchange for US$240 million infusion of new capital.
US Airways and its subsidiaries filed another chapter 11
petition on Sept. 12, 2004 (Bankr. E.D. Va. Case No. 04-13820).
Brian P. Leitch, Esq., Daniel M. Lewis, Esq., and Michael J.
Canning, Esq., at Arnold & Porter LLP, and Lawrence E. Rifken,
Esq., and Douglas M. Foley, Esq., at McGuireWoods LLP, represent
the Debtors in their restructuring efforts. In the Company's
second bankruptcy filing, it lists US$8,805,972,000 in total
assets and US$8,702,437,000 in total debts.
The Debtors' Chapter 11 plan for its second bankruptcy filing
became effective on Sept. 27, 2005. The Debtors completed their
merger with America West on the same date. (US Airways
Bankruptcy News, Issue No. 158; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).
* * *
As reported in the Troubled Company Reporter-Latin America on
March 27, 2008, Standard & Poor's Ratings Services revised its
outlook on US Airways Group Inc. to stable from positive. S&P
has affirmed all ratings, including the 'B-' long-term corporate
credit rating.
The TCR-LA reported on April 18, 2008, that Fitch Ratings has
affirmed the debt ratings of US Airways Group, Inc. as: Issuer
Default Rating at 'B-'; Secured term loan rating at 'BB-/RR1';
and Senior unsecured rating at 'CCC/RR6'. Fitch's ratings apply
to approximately US$1.7 billion in outstanding debt. The Rating
Outlook has been revised to Stable from Positive.
US AIRWAYS: Pilots Opt for USAPA as Bargaining Agents
-----------------------------------------------------
The US Airways pilots voted for change and have elected the US
Airline Pilots Association (USAPA) to replace the Airline Pilots
Association, Int'l. (ALPA), as their new bargaining agent. The
results of the election were announced by The National Mediation
Board. The new union will collectively represent over 5,000
mainline US Airways pilots from the merger of US Airways and
America West Airlines.
"The US Airways pilots have spoken for a change in union
representation," said USAPA interim President, Captain Stephen
Bradford. "USAPA is ready on day one to begin a new era for all
US Airways pilots, East and West. We will join the other great
independent airline pilot unions on the national front, while
our
pilots enjoy single carrier union representation, solely focused
on our pilots needs and fully accountable only to them."
"In addition to providing quality services to the US Airways
pilots, USAPA will approach management in a more businesslike
fashion to address the deficiencies of the collective US Airways
pilots' contracts, both East and West; contracts which were
originally accepted by the pilots during the hardships placed on
the airlines during the post 9/11 era," said Captain Bradford.
The US Airways pilots are one of the most senior and experienced
pilot groups in the United States. [They] fly a large fleet of
jet aircraft, including the Boeing B-737-300/400 and B-757/767
series, the Airbus A319/320/321 series, and the 266-seat Airbus
A330.
US Airways pilots fly their passengers safely to more than
180 destinations, including Europe, Canada, Mexico, the
Caribbean, Hawaii and in the near future, China.
USAPA represents over 5,000 US Airways pilots in seven domiciles
across the United States.
About US Airways
Based in Tempe, Arizona, US Airways Group Inc.'s (NYSE: LCC) -
http://www.usairways.com/-- primary business activity is the
ownership of the common stock of US Airways, Inc., Allegheny
Airlines, Inc., Piedmont Airlines, Inc., PSA Airlines, Inc.,
MidAtlantic Airways, Inc., US Airways Leasing and Sales, Inc.,
Material Services Company, Inc., and Airways Assurance Limited,
LLC.
US Airways has operations in Japan, Australia, China, Costa
Rica, Philippines, and Spain, among others.
Under a Chapter 11 plan declared effective on March 31, 2003,
USAir emerged from bankruptcy with the Retirement Systems of
Alabama taking a 40% equity stake in the deleveraged carrier in
exchange for US$240 million infusion of new capital.
US Airways and its subsidiaries filed another chapter 11
petition on Sept. 12, 2004 (Bankr. E.D. Va. Case No. 04-13820).
Brian P. Leitch, Esq., Daniel M. Lewis, Esq., and Michael J.
Canning, Esq., at Arnold & Porter LLP, and Lawrence E. Rifken,
Esq., and Douglas M. Foley, Esq., at McGuireWoods LLP, represent
the Debtors in their restructuring efforts. In the Company's
second bankruptcy filing, it lists US$8,805,972,000 in total
assets and US$8,702,437,000 in total debts.
The Debtors' Chapter 11 plan for its second bankruptcy filing
became effective on Sept. 27, 2005. The Debtors completed their
merger with America West on the same date. (US Airways
Bankruptcy News, Issue No. 158; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).
* * *
As reported in the Troubled Company Reporter-Latin America on
March 27, 2008, Standard & Poor's Ratings Services revised its
outlook on US Airways Group Inc. to stable from positive. S&P
has affirmed all ratings, including the 'B-' long-term corporate
credit rating.
The TCR-LA reported on April 18, 2008, that Fitch Ratings has
affirmed the debt ratings of US Airways Group, Inc. as: Issuer
Default Rating at 'B-'; Secured term loan rating at 'BB-/RR1';
and Senior unsecured rating at 'CCC/RR6'. Fitch's ratings apply
to approximately US$1.7 billion in outstanding debt. The Rating
Outlook has been revised to Stable from Positive.
===================================
D O M I N I C A N R E P U B L I C
===================================
SMURFIT KAPPA: S&P Lifts Rating on Improved Operations to BB
------------------------------------------------------------
Standard & Poor's Rating Services raised its long-term corporate
credit ratings on Ireland-based paper and packaging company
Smurfit Kappa Group PLC to 'BB' from 'BB-'. The outlook is
stable.
"The upgrade reflects Smurfit Kappa's improved operating
performance and financial position, both of which are likely to
prove sustainable over the longer term," said Standard & Poor's
credit analyst Jacob Zachrison.
"The improvements reflect better market conditions, lower debt
levels and successful implementation of cost savings. These
factors have contributed to improved credit measures, which we
expect to come into line with the requirements for the new
ratings," Mr. Zachrison added.
The ratings continue to reflect the group's aggressive financial
risk profile and exposure to volatile raw material prices as
well as cyclical industry conditions. These risk factors are
offset by the group's satisfactory business risk profile, which
is supported by its leading position in the European
containerboard and corrugated board markets, good geographical
diversification, and high level of forward integrated
operations.
Demand for Smurfit Kappa's main products is relatively stable
and linked to general economic conditions. Over the past two
years, pricing in the European recycled containerboard markets
has recovered from weak levels as the supply/demand balance has
improved.
The stable outlook reflects our expectations that Smurfit Kappa
will be able to continue to offset higher input costs through
increased sales prices. This is based on probable continued
modest growth in demand for the group's core products, as well
as modest capacity additions in containerboard.
Headquartered in Dublin, Ireland, Smurfit Kappa Group --
http://www.smurfit-group.com/-- manufactures containerboard
containerboard and converts it into corrugated cases, folding
cartons, paper sacks, tubes, and composite cans. Other products
include boxboard, sack kraft paper, and printing and writing
paper. The company produces 6 million tons of paper annually
and has 300 facilities worldwide. In Latin America, the company
operates in Argentina, Brazil, Chile, Colombia, Costa Rica,
Dominican Republic, Ecuador, Mexico and Venezuela.
=============
J A M A I C A
=============
NATIONAL WATER: Consumers Must Pay 28% More for Water
-----------------------------------------------------
Radio Jamaica reports that consumers will have to pay a total of
28% more for water that the National Water Commission of Jamaica
supplies.
According to Radio Jamaica, about 5% of the payment is a special
charge for improvement projects.
Radio Jamaica notes that the Office of Utilities Regulation
determined that there was a shortfall of J$2.4 billion in the
Commission's revenue projections, "less of a shortfall than the
NWC [The Commission] itself claimed when applying for the tariff
increase."
The OUR's Director of Consumer and Customer Service David Geddes
told Radio Jamaica that the Office expected that a 23% increase
in operating costs should be enough to meet The Commission's
revenue requirements.
Mr. Geddes commented to Radio Jamaica, "OUR's projected figures
had operating costs at J$13 billion and a total requirement of
J$14.2 billion with a total revenue projected of J$11.8 billion
... that would have left a shortfall of J$2.4 billion. For the
NWC to get that shortfall, it required a 23% change in operating
revenues."
The report says that OUR decided to allow a "K-Factor payment,"
calculated at 5% of each month's bill. This will let The
Commission undertake improvements to its service.
Radio Jamaica says that OUR increased the penalties for wrongful
disconnection and the automatic compensation of clients for
breaches of specific agreed standards.
"This includes a penalty for wrongful disconnection (and) we've
also reduced the time span within which NWC must reconnect the
service. In all cases NWC must now reconnect those accounts
that were disconnected for arrears once those arrears have been
cleared within 24 hours. If there's a wrongful disconnection,
then the reconnection period would be reduced to 12 hours," Mr.
Geddes told Radio Jamaica.
The rate increase in water supply from The Commission will take
effect on May 1, Radio Jamaica states. The Commission, however,
is disappointed with the rate increase OUR allowed.
As reported in the Troubled Company Reporter-Latin America on
Nov. 7, 2007, The Commission applied to OUR for a 40% raise in
water tariffs. The regulator said that it would have public
consultations across Jamaica to encourage consumers to
participate in the regulatory process and decision-making.
The Commission's Corporate Public Relations Manager Charles
Buchanan told the RJR News Center that the firm may not be able
to conduct scheduled improvements due to the level of the
increase. "We felt we had made a compelling argument showing
clearly that the cost of providing the service is not being
covered by the existing rates," Mr. Buchanan added.
The Commission will do what it can with the rates granted but
some of the projects that The Commission had proposed to do in
the short term may not be accomplished. The 23% increase would
see clients paying an average of J$200 more per month for water,
Radio Jamaica reports, citing Mr. Buchanan.
The National Water Commission is a statutory organization
charged with the responsibility of providing potable water and
wastewater services for the people of Jamaica.
* * *
The National Water Commission of Jamaica had been criticized for
failing to act promptly in cutting its losses. For the fiscal
years 2002 and 2003, the water commission accumulated a net loss
of US$2.11 billion. The deficit fell to US$1.86 billion the
following year, and to US$670 million in 2004 and 2005.
Jamaican citizens have been complaining to the commission about
water disruptions in their communities, resulting to
restrictions of water use.
===========
M E X I C O
===========
AMERICAN AXLE: Posts US$27 Million Net Loss in 1Q 2008
------------------------------------------------------
American Axle & Manufacturing Holdings, Inc. reported financial
results for the first quarter of 2008.
AAM's results in the first quarter of 2008 were a net loss of
US$27.0 million or US$0.52 per share. This compares to net
earnings of US$15.7 million, or US$0.30 per share, in the first
quarter of 2007.
UAW Strike
Upon expiration of the four-year master labor agreement between
AAM and the UAW at 11:59 p.m. on February 25, 2008, the
International UAW called a strike against AAM. The expiring
master labor agreement covered approximately 3,650 associates at
AAM's original U.S. locations in Michigan and New York. AAM
estimates the reduction in sales and operating income resulting
from the International UAW strike to be US$132.6 million and
US$45.8 million (US$0.56 per share), respectively.
Special Charges
In the first quarter of 2008, AAM incurred US$3.5 million, or
US$0.04 per share, of special charges and non-recurring
operating costs, primarily related to the redeployment of
machinery and equipment. In the first quarter of 2007, AAM
recorded special charges of US$2.9 million, or US$0.04 per
share, primarily related to attrition program activity.
"AAM's first quarter 2008 results were severely impacted by the
strike called by the International UAW at AAM's original U.S.
locations on February 25, 2008," said AAM Co-Founder, Chairman
of the Board & Chief Executive Officer Richard E. Dauch. "AAM
must have a U.S. market cost competitive labor agreement for the
original U.S. locations with operating flexibility. This is
needed to compete for new business and match the operational
flexibility and efficiency of our competitors. While it would
be tragic to dismantle AAM's original U.S. manufacturing base,
AAM will be forced to consider additional restructuring and
capacity rationalization actions if the International UAW
refuses to accept the structural and permanent changes needed to
achieve market cost competitiveness at these facilities."
Net sales in the first quarter of 2008 were US$587.6 million as
compared to US$802.2 million in the first quarter of 2007. AAM
estimates that approximately US$132.6 million of this decrease
was attributable to the International UAW strike. Customer
production volumes for the full-size truck and SUV programs AAM
currently supports for GM and Chrysler were down approximately
31% in the first quarter of 2008 as compared to the prior year.
AAM estimates that customer production volumes for its mid-sized
truck and SUV programs were down approximately 43% in the first
quarter of 2008 on a year-over-year basis. Non-GM sales
represented 26% of total sales in the first quarter of 2008.
AAM's content-per-vehicle is measured by the dollar value of its
product sales supporting GM's North American truck and SUV
platforms and Chrysler's heavy duty Dodge Ram pickup trucks. For
the first quarter 2008, AAM's content-per-vehicle increased
approximately 6% to US$1,326 as compared to US$1,252 in the
first quarter of 2007.
Gross margin for the first quarter of 2008 was 2.2% as compared
to 10.6% in first quarter 2007. Operating loss was US$36.7
million or a negative 6.2% of sales in the first quarter of 2008
as compared to operating income of US$36.4 million or 4.5% of
sales in the first quarter of 2007.
AAM's SG&A spending for the first quarter of 2008 was US$49.4
million as compared to US$48.9 million in the first quarter of
2007. AAM's R&D spending for the first quarter of 2008 was
approximately US$20.2 million as compared to US$20.1 million in
the first quarter of 2007.
Net cash provided by operating activities in the first quarter
of 2008 was US$8.2 million. Capital spending for the first
quarter of 2008 was US$33.3 million as compared to US$42.5
million in the first quarter of 2007. Reflecting the impact of
this activity and dividend payments of US$8.0 million, AAM's
free cash flow use of US$33.1 million in the first quarter of
2008 represents an improvement of US$7.4 million, or 18%, as
compared to the first quarter of 2007.
About America Axle
Headquartered in Detroit, Michigan, American Axle &
Manufacturing Holdings Inc. (NYSE:AXL) -- http://www.aam.com/--
and its wholly owned subsidiary, American Axle & Manufacturing,
Inc., manufactures, engineers, designs and validates driveline
and drivetrain systems and related components and modules,
chassis systems and metal-formed products for light trucks,
sport utility vehicles and passenger cars. In addition to
locations in the United States (in Michigan, New York and Ohio),
the company also subsidiaries in China, Japan, Korea, India,
Poland, Luxembourg and Mexico.
* * *
As reported in the Troubled Company Reporter-Latin America on
April 7, 2008, Moody's Investors Service placed the ratings
of American Axle & Manufacturing Holdings, Inc., Corporate
Family -- Ba3, under review for downgrade. In a related action,
American Axle's Speculative Grade Liquidity Rating was lowered
to SGL-2 from SGL-1.
CLEAR CHANNEL: Set to Release 1st Quarter 2008 Results on May 9
---------------------------------------------------------------
Clear Channel Communications, Inc. and Clear Channel Outdoor
Holdings, Inc. said that both companies will release first
quarter 2008 financial results before the market opens on
Friday, May 9, 2008 at approximately 7:00 a.m. Eastern Time.
The companies will not be hosting a teleconference or webcast as
a result of the Clear Channel Communications, Inc. pending
merger transaction that was approved by Clear Channel
Communications, Inc. shareholders on Sept. 25, 2007.
Based in San Antonio, Texas, Clear Channel Communications Inc.
(NYSE:CCU) -- http://www.clearchannel.com/-- is a media
and entertainment company specializing in "gone from home"
entertainment and information services for local communities and
premiere opportunities for advertisers. The company's
businesses include radio, television and outdoor displays.
Outside U.S., the company operates in 11 countries -- Norway,
Denmark, the United Kingdom, Singapore, China, the Czech
Republic, Switzerland, the Netherlands, Australia, Mexico and
New Zealand. As of Dec. 31, 2007, it owned 717 core radio
stations, 288 non-core radio stations which are being marketed
for sale and a leading national radio network operating in the
United States.
* * *
In March 2008, Standard & Poor's Ratings Services said its
ratings on Clear Channel Communications Inc., including the 'B+'
corporate credit rating, remain on CreditWatch with negative
implications.
Fitch Ratings stated that in line with previous guidance, Clear
Channel Communications' 'BB-' Issuer Default Rating and Senior
Unsecured Ratings would remain in place if the going-private
transaction is not completed.
Moody's stated that assuming the transaction is completed as
currently contemplated, Clear Channel will likely be assigned a
Corporate Family Rating of B2 and the rating on the existing
senior notes is likely to be notched down to Caa1 based on their
expected subordination to the new senior secured debt facilities
and the new senior notes.
CLEAR CHANNEL: Further Extends Offers' Expiration Date to May 2
---------------------------------------------------------------
In connection with Clear Channel Communications, Inc.'s
previously announced tender offer for its outstanding 7.65%
Senior Notes due 2010 (CUSIP No. 184502AK8) and Clear Channel's
subsidiary AMFM Operating Inc.'s previously announced tender
offer for its outstanding 8% Senior Notes due 2008 (CUSIP No.
158916AL0), Clear Channel disclosed that it has extended the
date on which the tender offers are scheduled to expire from
8:00 a.m. New York City time on April 25, 2008 to 8:00 a.m. New
York City time on May 2, 2008 and the consent payment deadline
for the Notes from 8:00 a.m. New York City time on April 25,
2008 to 8:00 a.m. New York City time on May 2, 2008.
The Offer Expiration Date and the Consent Payment Deadline are
subject to extension by Clear Channel, with respect to the CCU
Notes, and AMFM, with respect to the AMFM Notes, in their sole
discretion.
The completion of the tender offers and consent solicitations
for the Notes is conditioned upon the satisfaction or waiver of
all of the conditions precedent to the Agreement and Plan of
Merger by and among Clear Channel, CC Media Holdings, Inc., B
Triple Crown Finco, LLC, T Triple Crown Finco, LLC and BT Triple
Crown Merger Co., Inc., dated November 16, 2006, as amended by
Amendment No. 1, dated April 18, 2007, and Amendment No. 2,
dated May 17, 2007 and the closing of the merger contemplated by
the Merger Agreement. The closing of the Merger has not
occurred.
On March 26, 2008, Clear Channel, joined by CC Media Holdings,
Inc., filed a lawsuit in the Texas State Court in Bexar County,
Texas, against Citigroup, Deutsche Bank, Morgan Stanley, Credit
Suisse, The Royal Bank of Scotland, and Wachovia, the banks who
had committed to provide the debt financing for the Merger.
Clear Channel intends to complete the tender offers and consent
solicitations for the CCU Notes, and AMFM intends to complete
the tender offers and consent solicitations for the AMFM Notes,
upon consummation of the Merger.
Clear Channel previously announced on Jan. 2, 2008 that it had
received, pursuant to its previously announced tender offer and
consent solicitation for the CCU Notes, the requisite consents
to adopt the proposed amendments to the CCU Notes and the
indenture governing the CCU Notes applicable to the CCU Notes,
and that AMFM had received, pursuant to its previously announced
tender offer and consent solicitation for the AMFM Notes, the
requisite consents to adopt the proposed amendments to the AMFM
Notes and the indenture governing the AMFM Notes.
As of April 23 date, approximately 95 percent of the AMFM Notes
have been validly tendered and not withdrawn and approximately
99 percent of the CCU Notes have been validly tendered and not
withdrawn. The Clear Channel tender offer and consent
solicitation is being made pursuant to the terms and conditions
set forth in the Clear Channel Offer to Purchase and Consent
Solicitation Statement for the CCU Notes dated Dec. 17, 2007,
and the related Letter of Transmittal and Consent. The AMFM
tender offer and consent solicitation is being made pursuant to
the terms and conditions set forth in the AMFM Offer to Purchase
and Consent Solicitation Statement for the AMFM Notes dated
Dec. 17, 2007, and the related Letter of Transmittal and
Consent. Further details about the terms and conditions of the
tender offers and consent solicitations are set forth in the
Offers to Purchase and the related documents.
Clear Channel has retained Citi to act as the lead dealer
manager for the tender offers and lead solicitation agent for
the consent solicitations and Deutsche Bank Securities Inc. and
Morgan Stanley & Co. Incorporated to act as co-dealer managers
for the tender offers and co-solicitation agents for the consent
solicitations. Global Bondholder Services Corporation is the
Information Agent for the tender offers and the consent
solicitations. Questions regarding the tender offers should be
directed to Citi at (800) 558-3745 (toll-free) or (212) 723-6106
(collect). Requests for documentation should be directed to
Global Bondholder Services Corporation at (212) 430-3774 (for
banks and brokers only) or (866) 924-2200 (for all others toll-
free).
About Clear Channel
Based in San Antonio, Texas, Clear Channel Communications Inc.
(NYSE:CCU) -- http://www.clearchannel.com/-- is a media
and entertainment company specializing in "gone from home"
entertainment and information services for local communities and
premiere opportunities for advertisers. The company's
businesses include radio, television and outdoor displays.
Outside U.S., the company operates in 11 countries -- Norway,
Denmark, the United Kingdom, Singapore, China, the Czech
Republic, Switzerland, the Netherlands, Australia, Mexico and
New Zealand. As of Dec. 31, 2007, it owned 717 core radio
stations, 288 non-core radio stations which are being marketed
for sale and a leading national radio network operating in the
United States.
* * *
In March 2008, Standard & Poor's Ratings Services said its
ratings on Clear Channel Communications Inc., including the 'B+'
corporate credit rating, remain on CreditWatch with negative
implications.
Fitch Ratings stated that in line with previous guidance, Clear
Channel Communications' 'BB-' Issuer Default Rating and Senior
Unsecured Ratings would remain in place if the going-private
transaction is not completed.
Moody's stated that assuming the transaction is completed as
currently contemplated, Clear Channel will likely be assigned a
Corporate Family Rating of B2 and the rating on the existing
senior notes is likely to be notched down to Caa1 based on their
expected subordination to the new senior secured debt facilities
and the new senior notes.
EMPRESAS ICA: Ties Up With Alstom & Carson for Project Bid
----------------------------------------------------------
Empresas ICA S.A.B de C.V. has created a consortium with the
Mexican unit of French heavy equipment manufacturer Alstom and
Mexican construction firm Carso Infraestructura y Construccion
to bid for the project to expand Mexico City's metro.
Business News Americas relates that the consortium will
participate in the bid to build line 12 of the mass
transportation system.
According to BNamericas, the project will cost around
US$1.59 billion and the line will be 15 kilometers long, linking
the Iztapalapa and Tlahuac districts.
BNamericas notes that Alstom would handle the electromechanical
aspects of the project. Carso Infraestructura and Empresas ICA
will be responsible for the civil works.
The consortium will present its proposal to the federal
district's transport authority on April 30, according to
Empresas ICA.
Empresas ICA -- http://www.ica.com.mx/-- the largest
engineering, construction, and procurement company in Mexico,
was founded in 1947. ICA has completed construction and
engineering projects in 21 countries. ICA's principal business
units include civil construction and industrial construction.
Through its subsidiaries, ICA also develops housing, manages
airports, and operates tunnels, highways, and municipal services
under government concession contracts and/or partial sale of
long-term contract rights.
* * *
As reported in the Troubled Company Reporter-Latin America on
Sept. 20, 2007, Standard & Poor's Ratings Services affirmed its
'BB-' long-term corporate credit rating on Empresas ICA S.A.B.
de C.V. S&P said the outlook is stable.
FRONTIER AIRLINES: Trustee Appoints Seven-Member Creditors Panel
----------------------------------------------------------------
Diana G. Adams, United States Trustee for Region 2, appoints
seven members to the Official Committee of Unsecured Creditors
in the Chapter 11 cases of Frontier Airlines Holdings Inc., and
its debtor-affiliates.
The Creditors Committee members are:
(a) US Bank National Association
Corporate Trust Services
EX-NY-WALL
100 Wall Street, Suite 1600
New York, NY 10005
Attn: James E. Murphy, Vice President
(b) Credit Suisse Securities (USA) LLC
11 Madison Avenue
New York, New York 10010
Attn: Douglas Teresko, Director
(c) AQR Capital
Two Greenwich Plaza, 1st Floor
Greenwich, Connecticut 06830
Attn: Mark Mitchell, Principal
(d) Republic Airlines, Inc.
8909 Purdue Road, Suite 300
Indianapolis, Indiana 46268
Attn: Timothy P. Dooley, Vice President
(e) Airbus, S.A.S
Airbus North America
Customer Services, Inc.
c/o Airbus Americas, Inc.
198 Van Buren St., Ste 300
Herndon, VA 20170
Attn: R. Douglas Greco, Vice President
(f) Frontier Airlines Pilots Association
18300 E. 71st Ave., Suite 140
Denver, Colorado 80249
Attn: John Stemmler, President
(g) Goodrich Corporation
Four Coliseum Centre
2730 West Tyvola Road
Charlotte, North Carolina 28217-4578
Attn: Beth E. Hansen, Counsel
The organizational meeting of creditors in Frontier Airlines'
Chapter 11 cases was held on April 24, 2008, 11:00 a.m., at The
Westin New York at Times Square, 270 West 43rd Street, in
New York.
Pursuant to Section 1103 of the Bankruptcy Code, the Creditors
Committee may:
-- consult with the Debtor concerning the administration of
the bankruptcy case;
-- investigate the acts, conduct, assets, liabilities, and
financial condition of the Debtors, the operation of the
Debtors' business and the desirability of the continuance
of the business, and any other matter relevant to the case
or to the formulation of a plan of reorganization for the
Debtors;
-- participate in the formulation of a plan, advise its
constituents regarding the Committee's determinations as
to any plan formulated, and collect and file with the
Court acceptances or rejections of the plan;
-- request the appointment of a trustee or examiner; and
-- perform other services as are in the interest of its
constituents.
The Creditors Committee may retain counsel, accountants, or
other agents, to represent or perform services for the group.
Headquartered in Denver, Colorado, Frontier Airlines Inc. --
http://www.frontierairlines.com/-- provide air transportation
for passengers and freight. They operate jet service carriers
linking their Denver, Colorado hub to 46 cities coast-to-coast,
8 cities in Mexico, and 1 city in Canada, well as provide
service from other non-hub cities, including service from 10
non-hub cities to Mexico. As of May 18, 2007 they operated 59
jets, including 49 Airbus A319s and 10 Airbus A318s.
The Debtor and its debtor-affiliates filed for Chapter 11
protection on April 10, 2008, (Bankr. S.D. N.Y. Case No.: 08-
11297 thru 08-11299.) Hugh R. McCullough, Esq. at Davis Polk &
Wardwell represent the Debtors in their restructuring efforts.
Togul, Segal & Segal LLP is Debtors' Conflicts Counsel, Faegre &
Benson LLP is the Debtors' Special Counsel, and Kekst and
Company is the Debtors' Communications Advisors. At Dec. 31,
2007, Frontier Airlines Holdings Inc. and its subsidiaries'
total assets was US$1,126,748,000 and total debts was
US$933,176,000. (Frontier Airlines Bankruptcy News, Issue No.
4; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
GRUPO CASA: Net Income Up 13% to MXN191.61MM in 1st Quarter 2008
----------------------------------------------------------------
Grupo Casa Saba reported its consolidated financial and
operating results for the first quarter of 2008.
Financial Highlights:
All figures are expressed in millions of Mexican pesos as of
Dec. 31, 2007. Comparisons are made with the same period of
2007, unless otherwise stated.
Quarterly Earnings
-- Sales for the quarter totaled MXN6,934.03 million
-- Gross income increased 13.45%
-- Gross margin for the quarter was 9.43%
-- Quarterly operating expenses as a percentage of sales were
5.68%
-- The operating margin for the quarter was 3.75%
-- Net profit for the quarter reached MXN19MXN
Sales By Division
Private Pharma:
Sales in the Private Pharma division rose 18.11% during the
first quarter of 2008, as a result of the consolidation of
investments that were made within the sector during the past
several months and an increase in the market share. Sales
reached MXN5,964.19 million and represented 86.01% of the
group's total sales.
Government Pharma:
Sales in the Government Pharma division rose 15.97% due to a
significant increase in the number of units sold. This growth
was partly the result of an increase in sales to PEMEX.
Government Pharma sales reached MXN185.50 million during the
first quarter 2008 and accounted for 2.68% of the total sales.
Health, Buaty, Consumer Goods, General Merchandise, and Other:
Sales in the Health, Beauty, Consumer Goods, General Merchandise
and Other division rose 4.26% versus the first quarter of 2007.
Total sales for this division reached MXN597.59 million.
Publications:
Publication sales decreased 18.72% as a result of lower unit
sales. This decrease was due to the calendar effect of Holy
Week as well as a reduction in sales of political content
magazines. This division's participation as a percentage of
total sales went from 3.82% in first quarter 2007 to 2.69% in
first quarter 2008.
Gross Income
During the first quarter of the year, Grupo Casa Saba's gross
income rose 13.45% to reach MXN654.09 million. The company's
gross margin decreased by 16 basis points, to 9.43%.
Operating Expenses
Operating expenses reached MXN394.13 million, an increase of
14.16% versus the first quarter of 2007. This was partly the
result of the investments that were made over the course of the
past several months. Operating expenses represented 5.68% of
the total sales.
Operating Income
Operating income increased significantly, by 12.40%, to reach
MXN259.95 million during the period. The operating margin was
3.75%, 10 basis points lower than the 3.85% margin posted in the
first quarter of 2007.
Operating Income Plus Depreciation and Amortization
Operating income plus depreciation and amortization for the
first quarter 2008 was MXN276.87 million, an increase of 7.14%
compared to the first quarter of 2007. Depreciation and
amortization for the period was MXN16.91 million, 37.65% lower
than in the first quarter of 2007, which caused this line item
to be lower.
Cash and Cash Equivalents
Cash and cash equivalents at the end of the first quarter of
2008 was MXN178.03 million.
Comprehensive Cost of Financing
During the first quarter of 2008, Grupo Casa Saba's
comprehensive cost of financing of MXN5.79 million was MXN2.19
million higher than the comprehensive cost of financing
registered during the first quarter of 2007.
Other Expenses (Income)
During the first quarter of 2008, the company registered an
income of MXN2.49 million in other expenses (income). The
expenses (income) from this line item were derived from
activities that are distinct from the company's day-to-day
business operations.
Tax Provisions
During the first quarter, tax provisions were MXN65.03 million.
These provisions included MXN100.70 million in current income
tax and -MXN35.66 million in deferred income tax.
Net Income
Grupo Casa Saba's net income for the first quarter was MXN191.61
million, a significant increase of 13.02% versus the first
quarter of 2007. The net margin for the period was 2.76%.
Working Capital
During the first quarter of 2008 and compared to the first
quarter of 2007, accounts receivable days rose by 1.9 days to
reach 62.6 days. In addition, the company's accounts payable
days increased by 2.9 days compared to first quarter 2007, to
reach 49.9 days. Finally, the inventory days were 52.6 days,
2.3 days less than they were in first quarter 2007.
About Grupo Casa
Founded in 1892 and based in Mexico City, Mexico, Grupo Casa
Saba, SAB de CV -- http://www.casasaba.com-- (fka. Grupo Casa
Autrey, SA de CV) through its subsidiaries, operates as a multi-
channel, multi-product wholesale distributor in Mexico. It
distribute pharmaceutical products, health, beauty aids and
consumer goods, general merchandise, and publications, as well
as office, electronic, and other products, including keyboards,
audio and television equipment, and related accessories. The
company also offers freight services to third parties; real
estate services; a range of value added services, including
multiple daily deliveries, emergency product replacement,
merchandising, marketing support, and other customer counseling
services; and training, conferences, and trade fairs. It serves
privately-owned and government pharmacies, mass merchandisers,
regional and national supermarkets, department stores,
convenience stores, wholesalers, and other specialized channels.
As of Dec. 31, 2006, it operated a network of 20 distribution
centers.
* * *
As of March 30, 2007, Moody's Investors Service maintains a Ba2
global scale and A1.mx national scale corporate family rating
for Grupo Casa Saba, S.A. de C.V. with a stable ratings outlook.
The rating action still holds to date.
GRUPO TMM: Posts US$10.3 Mil. Net Loss in Quarter Ended March 31
----------------------------------------------------------------
Grupo TMM S.A.B. has reported its financial results for the
first quarter of 2008. For the first three months ended
March 31, 2008, the company incurred a net loss of US$10.3
million compared to a net loss of US$5.0 million for the same
period in 2007.
The company had net revenues of US$85.9 million for the 2008
first quarter, up 25.2 percent from US$68.6 million for the same
quarter in 2007.
Management Overview
Jose F. Serrano, chairman and chief executive officer of Grupo
TMM, stated, "During the past several quarters TMM has
substantially exceeded year-to-year comparisons in revenues,
transportation income an EBITDA."
"We are pleased to announce the issuance in the Mexican Market
of the securities of the second tranche of our Trust
Certificates Program for $1.55 billion pesos, or approximately
$136.9 million dollars, at a rate of TIIE, or Mexico's Interbank
Equilibrium Interest Rate, +195 basis points. These
Certificates will be funded Wednesday of this week."
"This accomplishment provides TMM the ability to grow through
the acquisition of new ships with long-term financing tied to
the useful life of these vessels and is non recourse to the
Company. The second issuance of this Program was rated AA-
(mex) by Fitch Ratings, reflecting TMM's continued quality
operating performance, increased demand for maritime
transportation services and the Mexican Navigation Law
principles."
"The proceeds from the second tranche of this Program will be
used to acquire additional offshore vessels, to repay existing
debt, to fund cash reserves required for the structure and to
pay issuance related expenses. We anticipate annual revenues
from these new vessels of approximately $29.0 million and an
annual EBITDA of approximately $21.8 million. With this
issuance the net debt of the Company will increase $90 million."
"We expect to close the third tranche of our Trust Certificates
Program for an estimated amount of $3.4 billion pesos in the
third quarter of this year. With these proceeds, we anticipate
to acquire seven vessels, to include product tankers and highly
specialized offshore vessels."
"Pemex has published the final terms for five product tankers
under bare boat and ship management contracts. As per their
last public announcement, Pemex will receive bids at the end of
May and will award these five-year contracts in June. If we were
to be awarded with any of these contracts, we would acquire
the necessary vessels with proceeds form the third tranche."
Mr. Serrano continued, "At Logistics, our trucking division
showed improvement. Gross profit improved $0.6 million from a
loss of $0.3 million in the first quarter of 2007 to a profit of
$0.3 million in the first quarter of 2008. The average age of
our current trucking fleet is five years, which will result in
lower maintenance requirements and higher fuel efficiency,
thereby improving profit. Our warehousing business continues to
show growth quarter over quarter. However, overall results in
the Logistics division were impacted by operating costs and
expenses in the auto hauling business and by decreased sales in
the automobile industry. As we complete the modernization and
rehabilitation of equipment in this business, we expect to
generate sustainable profit."
"On the financial costs side, the Company continues to pursue
alternatives to extend the maturity and reduce the cost of its
corporate debt. We believe every quarter we are closer to our
goal."
Mr. Serrano concluded, "With continued improvement in
consolidated operating profit, the acquisition of additional
vessels with contracted revenues in our Maritime division, new
equipment and new clients in place at our Logistics division and
all our efforts to reduce financial and corporate costs
throughout this year, we continue to build a solid platform for
profit and growth."
Investments in Fixed Assets
As of March 31, 2008, the company invested IS$54.4 million in
fixed assets, which included:
* US$36.5 million in the acquisition of one offshore vessel,
* US$14.7 million in the acquisition of two tugboats,
* US$2.4 million in the rehabilitation of the company's
facilities at Ciudad del Carmen and
* US$0.8 million in Logistics related assets.
As of March 31, 2008, the total market value of the company's
maritime assets is estimated to exceed their book value by
US$95 million.
Debt
As of March 31, 2008, TMM's total book value of debt was
US$508.6 million. This debt is supported by approximately
US$412 million of long-term contracted revenues.
Grupo TMM
Headquartered in Mexico City, Grupo TMM SA (NYSE: TMM)(MEX
VALORIS: TMMA) -- http://www.grupotmm.com/-- is a Latin
American multimodal transportation and logistics company.
Through its branch offices and network of subsidiary companies,
TMM provides a dynamic combination of ocean and land
transportation services.
* * *
Standard & Poor's Ratings Services raised its corporate credit
rating on Grupo TMM SA to 'B-' from 'CCC.' The rating was
removed from Creditwatch, where it was placed on Dec. 15, 2004.
S&P said the outlook is positive.
INGRAM MICRO: Unveils Global Restructuring Plan, 1Q '08 Results
---------------------------------------------------------------
Ingram Micro Inc. reported financial results for the first
quarter ended March 29, 2008. Net income for the first quarter
was US$64.1 million, compared with US$37.0 million in the year-
ago period. The prior-year quarter included a charge of
US$33.8 million, which was recorded to cost of sales for
commercial taxes on software imports in Brazil, as well as a
benefit of approximately US$0.02 per diluted share from the
favorable resolution of a U.S. tax audit.
Worldwide sales for the quarter were US$8.58 billion, a 4%
increase from US$8.25 billion in the prior-year period. The
translation impact of the relatively stronger foreign currencies
had an approximate six-percentage-point positive effect on
comparisons to the prior year.
Wordlwide Restructuring Plan
"We're pleased with the performance of our Asia-Pacific and
Latin America regions, both of which grew at double-digit rates
with good operating leverage," said Greg Spierkel, chief
executive officer, Ingram Micro Inc. "However, as we discussed
in February, softness in the economic environments in North
America and Europe is exerting pressure on our operations in
those regions. We've made good progress on the expense-
containment plan instituted earlier this year, but additional
steps are necessary in this environment. We are planning a
restructuring in our Europe, Middle East and Africa (EMEA)
operations, primarily in the regional headquarters, and made
targeted reductions of office-based positions in North America
earlier this month. We're confident that the actions will
improve productivity and operational effectiveness without
sacrificing customer service or vendor relationships, or
inhibiting profitable growth."
The planned actions are expected to generate US$18 million to
US$24 million of annualized savings, beginning in the second and
third quarters of 2008. Costs associated with these actions are
expected to be approximately US$11 million to US$13 million, the
majority of which are expected to be incurred during the second
and third quarters of 2008.
According to The Associated Press, citing a company
spokesperson, the restructuring plan will affect about 60 jobs
in the United States and six in Canada. AP adds that the job
cuts in Europe, Middle East and Africa are yet to be determined.
Additional First Quarter Highlights
Regional Sales
North American sales were US$3.29 billion (38% of total
revenues), essentially flat with the US$3.28 billion posted a
year ago.
EMEA sales were US$3.07 billion (36% of total revenues), an
increase of 1% versus the US$3.05 billion in the year-ago
quarter. The translation impact of the relatively stronger
European currencies had an approximate 11-percentage-point
positive effect on comparisons to the prior year.
Asia-Pacific sales were US$1.81 billion (21% of total revenues),
an increase of 16% versus the US$1.57 billion reported in the
year-ago quarter. The translation impact of the relatively
stronger regional currencies had an approximate 10-percentage-
point positive effect on comparisons to the prior year.
Latin American sales were US$407 million (5% of total revenues),
an increase of 18% compared to the US$346 million posted a year
ago.
Gross Margin
Gross margin was 5.66%, an increase of 70 basis points versus
the prior-year quarter, driven by general business improvements
in every region. In the prior-year quarter, the charge related
to Brazilian commercial taxes adversely affected the gross
margin by approximately 41 basis points.
Operating Expenses
Total operating expenses were US$386.2 million or 4.50% of
revenues versus US$335.1 million or 4.06% of revenues in the
year-ago quarter. Softer sales growth due to the weaker-demand
environment, additional investments in people and infrastructure
to support our strategic initiatives, and growth in our fee-for-
services business had a negative impact on operating expenses as
a percent of revenues.
Operating Income
Worldwide operating income was US$99.3 million or 1.16% of
revenues. In the year-ago quarter, operating income was US$73.7
million or 0.89% of revenues, which includes the Brazilian tax
charge of approximately US$33.8 million or 41 basis points.
North American operating income was US$40.6 million or 1.23% of
revenues, compared to US$57.0 million or 1.74% of revenues in
the year-ago quarter.
EMEA operating income was US$26.8 million or 0.87% of revenues,
compared to US$35.0 million or 1.15% of revenues in the year-ago
quarter.
Asia-Pacific operating income increased 65% to US$32.5 million
or 1.79% of revenues from US$19.7 million or 1.25% of revenues
in the year-ago quarter.
Latin America operating income was US$7.8 million or 1.92% of
revenues. In the year ago quarter, the region recorded an
operating loss of US$28.4 million or 8.20% of revenues due to
the US$33.8 million commercial tax charge in Brazil, described
previously, which was approximately 9.76% of revenues.
Stock-based compensation expense, which amounted to US$8.4
million in the current quarter and US$9.6 million in the prior
year quarter, is presented as a separate reconciling amount in
the company's segment reporting in both periods. As such, these
expenses are not included in the regional operating results, but
are included in the worldwide operating results.
Other income and expense for the quarter was US$12.7 million
versus US$15.4 million in the year-ago period, primarily driven
by lower interest rates.
The effective tax rate for the quarter was 26%, which includes a
favorable two-percentage-point discrete impact of a tax-rate
change in China. The effective rate in the prior year period
was 36.6%, which was negatively impacted by the Brazilian
commercial tax charge referenced previously.
Total depreciation and amortization was US$16.9 million.
Capital expenditures were approximately US$10.9 million.
Balance Sheet
The cash balance at the end of the quarter was US$567 million,
relatively flat with the year-end balance. Total debt was
US$609 million, an increase of US$86 million from year-end.
Debt-to-capitalization was 15% versus 13% at the end of 2007.
The company repurchased approximately 5.3 million shares during
the first quarter of 2008, for an aggregate amount of
US$86.6 million. Total shares repurchased since the inception of
the program in mid-November 2007 through the quarter-end is
6.6 million shares for an aggregate amount of US$111.7 million.
Inventory was US$2.89 billion or 32 days on hand compared to
US$2.77 billion or 27 days on hand at the end of the year. The
increase in inventory days is primarily due to the softer sales
environment.
Working capital days were 26, an increase of four days from
year-end, primarily due to higher inventory days. Working
capital days were roughly flat with the first quarter of the
prior year.
As of March 29, 2008, total assets were US$8.7 billion, total
liabilities were US$5.2 billion, and total equity was
US$3.5 billion.
"Despite the challenging economic environment, gross margins
were at the highest first-quarter level in 10 years," said
William D. Humes, executive vice president and chief financial
officer. "This is a direct result of our commitment to
strategic initiatives that improve the margin profile and
continued focus on our most profitable lines of business. Other
bright spots included strong performances in many of our
emerging markets. We are clearly focused on opportunities to
reduce operating expenses and inventory levels. While it's
difficult to make rapid adjustments in these areas when demand
slows, we have improvement plans in place and I expect to see
good progress going forward."
Outlook for the Second Quarter
The following statements are based on the company's current
expectations and internal forecasts. These statements are
forward-looking and actual results may differ materially, as
outlined in the company's periodic filings with the Securities
and Exchange Commission.
According to the company's guidance for the second quarter
ending June 28, 2008: Sales are expected to range from US$8.50
billion to US$8.75 billion. Net income is expected to range
from US$59 million to US$64 million, or US$0.34 to US$0.37 per
diluted share. This does not include costs related to the
expense-reduction plans in North America and EMEA. The timing
of the costs cannot be predicted with certainty, but are
estimated to be approximately US$2 million to US$4 million in
the second quarter, with the balance substantially incurred in
the third quarter.
The weighted average shares outstanding and effective tax rate
are expected to be approximately 172 million and 28%,
respectively.
"Our second-quarter guidance reflects continued economic
softness in North America and Europe, with solid growth in Asia-
Pacific and Latin America," said Mr. Spierkel. "The expected
sequential sales growth is following a fairly normal seasonal
pattern, with a modest benefit from slightly stronger foreign
currencies compared to the first quarter. While we are taking
the necessary steps to manage our cost structure in the current
economy, we will continue to pursue activities that improve our
infrastructure, generate greater customer loyalty, diversify our
business mix and enhance margins. The company has proven its
resiliency in similar economic environments and we will be
stronger than ever when the economy rebounds."
About Ingram Micro Inc.
Headquartered in Santa Ana, California, Ingram Micro Inc.
(NYSE: IM) -- http://www.ingrammicro.com/-- together with its
subsidiaries, distributes information technology products and
supply chain solutions worldwide. Its IT products include
peripherals, networking, software, and systems. The company has
Latin America operations in Brazil, Chile and Mexico.
* * *
As reported in the Troubled Company Reporter-Latin America on
Feb. 18, 2008, Moody's affirmed Ingram Micro Inc.'s Ba1
corporate family rating and assigned a Ba2 (LGD-5, 75%) rating
to the company's five-year US$275 million senior unsecured
revolving credit facility due 2012. The rating outlook is
stable. Proceeds from the credit facility, which was put in
place in August 2007, are intended to be used for working
capital needs and general corporate purposes. It replaces an
unrated US$175 million revolver that was set to expire in July
2008. The new credit facility includes an accordion feature
under which total commitments may be increased up to US$450
million, subject to approval by the bank syndicate, at any time
prior to maturity date.
SHARPER IMAGE: Allowed to Employ Weil, Gotshal as Attorney
----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware granted
Sharper Image Corp. authority to employ Weil, Gotshal & Manges
LLP as its attorneys to perform the extensive legal services
that will be necessary during the Chapter 11 case.
According to Rebecca L. Roedell, executive vice president and
chief financial officer of Sharper Image, the Debtor selected
WG&M because of the firm's extensive general experience and
knowledge and, in particular, its recognized expertise in the
field of debtor's protections, creditors' rights and business
reorganizations under Chapter 11 of the Bankruptcy Code.
Ms. Roedell related that WG&M has become familiar with
the Debtor's business, affairs, and capital structure because
prior to the Petition Date, in February 2008, WG&M has provided
assistance and advice to the Debtor with respect to formulating,
evaluating, and implementing various restructuring,
reorganization, and other strategic alternatives. Also, WG&M
assisted and advised the Debtor in connection with the
preparation for the Chapter 11 case.
WG&M will represent the Debtor in coordination with Womble
Carlyle Sandridge & Rice, PLLC. WG&M and Womble have discussed
a division of responsibilities in connection with representation
of the Debtor and will make every effort to avoid and minimize
duplication of services in the representation of the Debtor, Ms.
Roedell adds.
The Debtor proposed to pay WG&M its customary hourly rates for
services rendered that are in effect from time to time and to
reimburse WG&M according to its customary reimbursement
policies.
Harvey R. Miller, Esq., a partner at WG&M, assured the Court
that his firm is a "disinterested person" as that term is
defined in Section 101(14) of the Bankruptcy Code.
Based in San Francisco, California, Sharper Image Corp. --
http://www.sharperimage.com/-- is a multi-channel specialty
retailer. It operates in three principal selling channels: the
Sharper Image specialty stores throughout the U.S., the Sharper
Image catalog and the Internet. The company has operations in
Australia, Brazil and Mexico. In addition, through its Brand
Licensing Division, it is also licensing the Sharper Image brand
to select third parties to allow them to sell Sharper Image
branded products in other channels of distribution.
The company filed for Chapter 11 protection on Feb. 19, 2008
(Bankr. D.D., Case No. 08-10322). Steven K. Kortanek, Esq. at
Womble, Carlyle, Sandridge & Rice, P.L.L.C. represents the
Debtor in its restructuring efforts. An Official Committee of
UnsecuredCreditors has been appointed in the case. When the
Debtor filed for bankruptcy, it listed total assets of
US$251,500,000 and total debts of US$199,000,000. (Sharper
Image Bankruptcy News, Issue No. 8; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000)
SHARPER IMAGE: Committee Wants to Retain Cooley as Lead Counsel
---------------------------------------------------------------
The Official Committee of Unsecured Creditors of Sharper Image
Corp. seeks the authority of the U.S. Bankruptcy Court for the
District of Delaware to retain Cooley Godward Kronish LLP as its
lead counsel, nunc pro tunc to the Debtor's bankruptcy filing.
Steven D. Sass, co-chairperson of the Creditors Committee,
relates that the Creditors Committee selected Cooley Godward
because the attorneys in the bankruptcy group at the firm have
significant experience representing creditors' committees in
retail Chapter 11 cases throughout the country.
As the Creditors Committee's lead counsel, Cooley Godward will:
(a) attend the meetings of the Creditors Committee;
(b) review financial information furnished by the Debtor to
the Creditors Committee;
(c) negotiate the budget and the use of cash collateral;
(d) review and investigate the liens of purported secured
parties;
(e) confer with the Debtor's management and counsel;
(f) coordinate efforts to sell assets of the Debtor in a
manner that maximizes the value for unsecured creditors;
(g) review the Debtor's schedules, statement of affairs and
business plan;
(h) advise the Creditors Committee as to the ramifications
regarding all of the Debtor's activities and motions
before this Court;
(i) file appropriate pleadings on behalf of the Creditors
Committee;
(j) review and analyze the Debtor's financial advisor's work
product and reports to the Creditors Committee;
(k) provide the Creditors Committee with legal advice in
relation to the case;
(l) prepare various applications and memoranda of law
submitted to the Court for consideration and handle all
other matters relating to the representation of the
Creditors Committee that may arise;
(m) assist the Creditors Committee in negotiations with the
Debtor and other parties in interest on an exit strategy
for this case; and
(n) perform other legal services for the Creditors Committee
as may be necessary or proper in this proceeding.
Seven Cooley Godward professionals are expected to have primary
responsibility for providing services to the Creditors
Committee:
Professional Hourly Rates
------------ ------------
Lawrence C. Gottlieb US$850
Jay R. Indyke US$760
Cathy R. Hershcopf US$680
Richard S. Kanowitz US$680
Brent Weisenberg US$525
Seth Van Aalten US$470
Brian W. Byun US$335
The firm will be reimbursed for reasonable expenses incurred in
rendering services to the Creditors Committee.
Mr. Gottlieb, a partner at Cooley Godward, assures the Court
that his firm is a "disinterested person," as that term is
defined in Section 101(14) of the Bankruptcy Code.
Based in San Francisco, California, Sharper Image Corp. --
http://www.sharperimage.com/-- is a multi-channel specialty
retailer. It operates in three principal selling channels: the
Sharper Image specialty stores throughout the U.S., the Sharper
Image catalog and the Internet. The company has operations in
Australia, Brazil and Mexico. In addition, through its Brand
Licensing Division, it is also licensing the Sharper Image brand
to select third parties to allow them to sell Sharper Image
branded products in other channels of distribution.
The company filed for Chapter 11 protection on Feb. 19, 2008
(Bankr. D.D., Case No. 08-10322). Steven K. Kortanek, Esq. at
Womble, Carlyle, Sandridge & Rice, P.L.L.C. represents the
Debtor in its restructuring efforts. An Official Committee of
UnsecuredCreditors has been appointed in the case. When the
Debtor filed for bankruptcy, it listed total assets of
US$251,500,000 and total debts of US$199,000,000. (Sharper
Image Bankruptcy News, Issue No. 8; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000)
SHARPER IMAGE: Committee Wants to Retain Loughlin as Advisor
------------------------------------------------------------
The Official Committee of Unsecured Creditors of Sharper Image
Corp. seeks the authority of the U.S. Bankruptcy Court for the
District of Delaware to retain Loughlin Meghji + Company as its
financial advisor, nunc pro tunc to the Debtor's bankruptcy
filing.
Steven D. Sass, co-chairperson of the Creditors Committee,
relates that the Creditors Committee selected Loughlin because
of the firm's experience and expertise, and the complex nature
of the Debtor's business and financial affairs.
As the Creditors Committee's financial advisor, Loughlin will:
(a) assist and advise the Creditors Committee in the analysis
of the current financial position of the Debtor;
(b) assist and advise the Creditors Committee in its analysis
of the Debtor's business plans cash flow projections,
restructuring programs, selling, general and
administrative structure, and other reports and analyses
prepared by the Debtor or their professionals, in order to
assist the Creditors Committee in its assessment of the
business viability of the Debtor, the reasonableness of
projections and underlying assumptions, the impact of
market conditions on forecast results of the Debtor, and
the viability of any restructuring strategy pursued by the
Debtor or other parties in interest;
(c) assist and advise the Creditors Committee in its analysis
of proposed transactions for which the Debtor seeks Court
approval;
(d) assist and advise the Creditors Committee in its analysis
of the Debtor's internally-prepared financial statements
and related documentation in order to evaluate performance
of the Debtor as compared to its projected results;
(e) attend and advise at meetings and calls with the Creditors
Committee, its counsel and representatives of the Debtor
and other parties;
(f) assist and advise the Creditors Committee and its counsel
in the development, evaluation and documentation of any
Plan of Reorganization or strategic transaction;
(g) assist and advise the Creditors Committee in its analysis
of the Debtor's hypothetical liquidation analyses under
various scenarios; and
(h) assist and advise the Creditors Committee in other service
as may be necessary and advisable.
The services to be provided by Loughlin will be at the request
and direction of the Creditors Committee, so as to avoid
duplicative efforts among the Creditors Committee's
professionals retained in the Chapter 11 case.
In exchange for the contemplated services, Loughlin will be paid
based on the firm's applicable hourly rates:
Professional Hourly Rates
------------ ------------
Principal/Managing Director US$625 to US$750
Director US$425 to US$495
Senior Associate US$375
Associate US$325
Analyst US$250
Paraprofessional US$125
The firm will be reimbursed for reasonable expenses incurred in
rendering services to the Creditors Committee.
Kenneth Simon, Esq., a partner at Loughlin, assures the Court
that his firm is a "disinterested person," as that term is
defined in Section 101(14) of the Bankruptcy Code.
Based in San Francisco, California, Sharper Image Corp. --
http://www.sharperimage.com/-- is a multi-channel specialty
retailer. It operates in three principal selling channels: the
Sharper Image specialty stores throughout the U.S., the Sharper
Image catalog and the Internet. The company has operations in
Australia, Brazil and Mexico. In addition, through its Brand
Licensing Division, it is also licensing the Sharper Image brand
to select third parties to allow them to sell Sharper Image
branded products in other channels of distribution.
The company filed for Chapter 11 protection on Feb. 19, 2008
(Bankr. D.D., Case No. 08-10322). Steven K. Kortanek, Esq. at
Womble, Carlyle, Sandridge & Rice, P.L.L.C. represents the
Debtor in its restructuring efforts. An Official Committee of
UnsecuredCreditors has been appointed in the case. When the
Debtor filed for bankruptcy, it listed total assets of
US$251,500,000 and total debts of US$199,000,000. (Sharper
Image Bankruptcy News, Issue No. 8; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000)
SHARPER IMAGE: Committee Wants to Retain Whiteford as Counsel
-------------------------------------------------------------
The Official Committee of Unsecured Creditors of Sharper Image
Corp. seeks the authority of the U.S. Bankruptcy Court for the
District of Delaware to retain Whiteford Taylor Preston LLC as
its Delaware counsel, nunc pro tunc as the Debtor's bankruptcy
filing.
Steven D. Sass, co-chairperson of the Creditors Committee,
states that due to the size and the complex nature of the
Chapter 11 case as well as the significant relief sought by the
Debtor during the early stages of the case, there was an
immediate need for Whiteford Taylor to perform services for the
Creditors Committee.
Mr. Sass relates that the Creditors Committee selected Whiteford
Taylor because of the firm's substantial experience appearing
before Courts in Delaware and representing committees and
creditors in complex reorganization cases.
As the Creditors Committee's Delaware counsel, Whiteford Taylor
will:
(a) provide legal advice with respect to the Creditors
Committee's rights, powers and duties in the Chapter 11
case;
(b) assist lead counsel in preparing, filing and serving all
necessary applications, answers, responses, objections,
orders, reports and other legal papers;
(c) represent the Creditors Committee in any matters arising
in the bankruptcy case;
(d) assist the Creditors Committee in its investigation and
analysis of the Debtor;
(e) represent the Creditors Committee in all aspects of
confirmation proceedings; and
(f) perform all other legal services for the Creditors
Committee that may be necessary or desirable in the
proceedings.
In exchange for the contemplated services, Whiteford Taylor will
be paid based on the firm's applicable hourly rates:
Professional Hourly Rates
------------ ------------
Shareholders US$390 to US$530
Associates US$280 to US$370
Legal Assistants/Paralegals US$210 to US$250
Five Whiteford Taylor professionals are expected to have primary
responsibility for providing services to the Creditors
Committee:
Professional Hourly Rates
------------ ------------
Margaret M. Manning US$385
Daniel A. Griffith US$410
Cara Chasney US$250
Kathleen G. McCruden US$210
Jennifer L. Tittsworth US$210
The firm will be reimbursed for reasonable expenses incurred in
rendering services to the Creditors Committee.
Ms. Manning, a partner at Whiteford Taylor, assures the Court
that her firm is a "disinterested person," as that term is
defined in Section 101(14) of the Bankruptcy Code.
Based in San Francisco, California, Sharper Image Corp. --
http://www.sharperimage.com/-- is a multi-channel specialty
retailer. It operates in three principal selling channels: the
Sharper Image specialty stores throughout the U.S., the Sharper
Image catalog and the Internet. The company has operations in
Australia, Brazil and Mexico. In addition, through its Brand
Licensing Division, it is also licensing the Sharper Image brand
to select third parties to allow them to sell Sharper Image
branded products in other channels of distribution.
The company filed for Chapter 11 protection on Feb. 19, 2008
(Bankr. D.D., Case No. 08-10322). Steven K. Kortanek, Esq. at
Womble, Carlyle, Sandridge & Rice, P.L.L.C. represents the
Debtor in its restructuring efforts. An Official Committee of
UnsecuredCreditors has been appointed in the case. When the
Debtor filed for bankruptcy, it listed total assets of
US$251,500,000 and total debts of US$199,000,000. (Sharper
Image Bankruptcy News, Issue No. 8; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000)
THERMADYNE HOLDINGS: Earns US$4 Million in Quarter Ended Dec. 31
----------------------------------------------------------------
Thermadyne Holdings Corporation reported results for the three
months and twelve months ended Dec. 31, 2007.
For the fourth quarter of 2007, net income was US$4.6 million
compared to a net loss of US$10.6 million.
For the fourth quarter of 2007, net income from continuing
operations was US$6.4 million. In comparison, for the fourth
quarter of 2006, net income from continuing operations was
US$15.3 million including US$13.3 million of curtailment gain
and related post retirement expense reductions.
Included in net income were losses from discontinued operations
of US$1.8 million in the 2007 fourth quarter compared to losses
of US$25.9 million in the 2006 fourth quarter.
Net cash provided from operating activities totaled US$23.0
million increasing US$17.9 million over 2006.
For 2007, net income was US$8.7 million compared to a net loss
of US$23.0 million for the year 2006.
For 2007, net income from continuing operations increased to
US$10.6 million from US$2.5 million of net income from
continuing operations for the year 2006. Included in net income
were losses from discontinued operations of US$2.0 million for
the year 2007 and lost US$25.5 million.
Net cash provided from operating activities totaled US$23.0
million increasing US$38.5 million over 2006.
Liquidity and Capital Resources
In 2007, the company's net cash provided by continuing
operations was US$4.8 million. Net debt repayments were US$21.7
million which included US$14 million in repayment of the second-
lien facility. The funding for the second-lien facility
repayments arose from the proceeds of the sale of its South
African discontinued operations.
The company has US$36 million in outstanding indebtedness under
its second-lien facility. The second-lien facility is secured
by a second lien on substantially all of the assets of the
company's domestic subsidiaries.
On June 29, 2007, the company entered into amendment and waiver
to the second lien credit agreement between the company and
Credit Suisse, as administrative agent and collateral agent, and
the lenders party thereto to: (i) extend the maturity date to
Nov. 7, 2010 and (ii) lower the interest rate from LIBOR plus
4.50% to LIBOR plus 2.75%. In connection with this amendment,
the company prepaid US$14 million of the outstanding
indebtedness, reducing the second lien facility from US$50
million to US$36 million. The prepayment was funded through the
proceeds of the sale of South African assets.
The operating activities of its continuing operations provided
US$23.0 million of cash during the year ended Dec. 31, 2007,
compared to cash used of US$15.5 million during the year ended
Dec. 31, 2006.
At Dec. 31, 2007, the company's balance sheet showed total
assets of US$497.427 million, total liabilities of US$375.343
million and total shareholders' equity of US$122.084 million.
About Thermadyne Holdings Corporation
Based in St. Louis, Missouri, Thermadyne Holdings Corporation
(OTC BB: THMD) - http://www.Thermadyne.com/-- manufactures and
markets cutting and welding products and accessories. The
company has operations in Malaysia, Indonesia, Singapore,
Philippines, Italy, Mexico, Chile and Brazil. In 2007, its
revenues totaled approximately US$494 million.
* * *
Thermadyne Holdings Corp. continues to carry Standard & Poor's
Ratings Services 'CCC+' corporate credit rating which was placed
on Aug. 15, 2007.
U.S. STEEL: R. Beltz Named as North-Am Flat-Rolled Marketing GM
---------------------------------------------------------------
United States Steel Corporation disclosed that Robert J. Beltz
has been named general manager-North American flat-rolled
marketing. Mr. Beltz will report to Richard M. Efkeman, vice
president-worldwide marketing.
Mr. Beltz, 39, will oversee industry market strategies, product
mix distribution and pricing for U. S. Steel's flat-rolled
operations in the United States and Canada. Beltz joined the
company in 1990 as a management associate in accounting and
finance. After spending two years in the audit department, he
moved into the company's commercial organization in 1993 and
advanced through increasingly responsible positions over the
next 14 years, including managerial roles in automotive sales
and marketing at U. S. Steel's Automotive Center in Troy, Mich.
In February 2007, Beltz relocated to the company's corporate
headquarters in Pittsburgh when he was named director-market
analysis and strategy. He advanced to his most recent
position, director-industry marketing, in November 2007.
Mr. Beltz is a native of Canonsburg, Pa., and graduated from
Duquesne University in 1990 with a bachelor's degree in
accounting. He earned a master's degree in business
administration from the University of Michigan-Flint in 1997.
Mr. Beltz is a member of the American Iron and Steel Institute's
Construction Market Committee.
About U.S. Steel Corporation
Headquartered in Pittsburgh, Pennsylvania, United States Steel
Corporation (NYSE: X) -- http://www.ussteel.com/-- manufactures
a wide variety of steel sheet, tubular and tin products; coke,
and taconite pellets; and has a worldwide annual raw steel
capability of 31.7 million net tons. U.S. Steel's domestic
primary steel operations are: Gary Works in Gary, Indiana; Great
Lakes Works in Ecorse and River Rouge, Michigan; Mon Valley
Works, which includes the Edgar Thomson and Irvin plants, near
Pittsburgh and Fairless Works near Philadelphia, Pennsylvania;
Granite City Works in Granite City, Illinois; Fairfield Works
near Birmingham, Alabama; Midwest Plant in Portage, Indiana; and
East Chicago Tin in East Chicago, Indiana. The company also
operates two seamless tubular mills, Lorain Tubular Operations
in Lorain, Ohio; and Fairfield Tubular Operations near
Birmingham, Alabama.
U. S. Steel produces coke at Clairton Works near Pittsburgh, at
Gary Works and Granite City Works. On Northern Minnesota's
Mesabi Iron Range, U.S. Steel's iron ore mining and taconite
pellet operations, Minnesota Taconite and Keewatin Taconite,
support the steelmaking effort, and its subsidiary ProCoil
Company provides steel distribution and processing services.
U.S. Steel's steelmaking subsidiaries U.S. Steel Kosice, s.r.o.,
in Kosice, Slovakia and U.S. Steel Serbia, d.o.o, in Sabac and
Smederevo, Serbia. Acero Prime, the company's joint venture
with Feralloy Mexico, S.R.L. de C.V. and Intacero de Mexico,
S.A. de C.V., provides Mexico's automotive and appliance
manufacturers with total supply chain management services
through its slitting and warehousing facility in San Luis Potosi
and its warehouse in Ramos Arizpe.
* * *
In December 2007, Standard & Poor's Ratings Services assigned
its 'BB+' senior unsecured rating to the proposed offering of up
to US$400 million in senior unsecured notes due Feb. 1, 2018, of
United States Steel Corp. (BB+/Negative/--). The notes are
being issued under the company's unlimited shelf registration
filed on March 5, 2007.
VITRO SAB: Books US$30MM Consolidated Net Income in 1Q 2008
-----------------------------------------------------------
Vitro S.A.B. de C.V. reported its first quarter 2008 unaudited
results. Year over year consolidated sales increased 6.1% while
EBITDA declined 15.6%. The consolidated EBITDA margin dropped
to 12.6% from 15.9% in the same period last year as natural gas
prices increased 23%.
Chief Financial Officer Enrique Osorio said, "The fundamentals
of our business have not changed, the top line was what we
expected, demand was strong and sales were up. In fact, on a
comparable basis, sales for the quarter reached an all-time high
of $640 million. Higher energy costs and a temporary decline in
production resulting from the planned refurbishing of four glass
container furnaces, however, impacted EBITDA for the quarter.
But overall, our business remains strong."
Glass Containers President, David Gonzalez commented,
"Containers sales remained strong posting record comparable
sales for a first quarter. Export sales rose almost 14% year-
over-year, including those to the US market, proving that this
is a fairly resilient business. Domestic sales also performed
well, up 3.5% despite Easter week this year falling in the first
quarter compared with the second quarter last year."
"EBITDA, in turn, decreased 15.1% year-over-year largely due to
a strong increase in natural gas prices, higher cost of raw
materials and the impact of having two cosmetics glass container
plants working in parallel as we transition production to our
new plant in Toluca. Four furnace repairs this quarter compared
to only two last year also contributed to a lower fixed cost
absorption," continued Mr. Gonzalez.
Commenting on Flat Glass, Hugo Lara noted, "Flat Glass sales
increased 5.1% this quarter. While sales in our US subsidiary
declined, sales in Spain continued to grow despite the
contraction in residential construction in the country. Auto
sales, in turn, increased for both the original equipment
manufacturing and auto glass replacement markets. EBITDA for
the quarter, however, fell by 15.7% affected by higher energy
and raw materials costs. Following our strategy to extend our
European presence, on April 1, 2008 we purchased a small glass
company in Paris for 3.6 million Euros. This company, now
called Vitro Cristalglass France SAS, is dedicated to the
transformation and commercialization of value added glass for
the commercial and residential markets."
Discussing the financial front, Mr. Osorio noted, "As expected,
net debt to EBITDA rose to 3.3 times from 2.9 times in the
fourth quarter of last year, as working capital requirements
were higher this quarter. Capital expenditures to strengthen
Vitro's market position and expand our client base also
contributed to the increase. The average cost of debt, in turn,
dropped 30 basis points year-over-year to 9.2%."
"Bottom line, the fundamentals of our business remain strong and
we will continue to build on Vitro's strengths in the glass
industry," Mr. Osorio closed.
Sales
Consolidated net sales for first quarter 2008 increased 6.1%
year over year to US$640 million from US$603 million last year.
For LTM 2008, consolidated net sales rose 6.6% to US$2,597
million from US$2,435 in LTM 2007. Glass Containers sales for
the quarter rose year over year by 7.5% while Flat Glass sales
grew 5.1% over the same time period.
During the quarter domestic, export and foreign subsidiaries'
sales increased 7.5%, 9.8% and 2.1% year over year respectively.
EBIT and EBITDA
Consolidated EBIT for the quarter decreased 19.3% year over year
to US$42 million from US$52 million last year. EBIT margin
decreased 2.1%age points to 6.6% from 8.7%. On a LTM basis,
consolidated EBIT increased 12.6% to US$231 million from US$206
million in LTM 2007. During this same period of time, EBIT
margin increased 50 basis points to 8.9% from 8.4%.
EBIT for the quarter at Glass Containers decreased by 11.9% year
over year, while at Flat Glass EBIT decreased by 32.4%.
Consolidated EBITDA for the quarter declined by 15.6% to US$81
million from US$96 million in first quarter 2007. The EBITDA
margin decreased 3.3%age points year over year to 12.6% from
15.9% and was negatively affected, among other factors, by
higher energy and raw materials costs, the impact of four
furnaces under programmed maintenance, transition of production
of the company's new cosmetics glass container plant and having
Easter week during the quarter. On a LTM basis, consolidated
EBITDA decreased 4.4% to US$376 million from US$393 million in
LTM 2007.
During the quarter, EBITDA at Glass Containers decreased 15.1%
year over year to US$58 million from US$68 million while EBITDA
at Flat Glass decreased 15.7% year over year to US$22 million
from US$26 million.
Consolidated Financing Result
Consolidated financing result for the quarter decreased 65% year
over year to US$16 million compared with US$47 million during
first quarter 2007. This was mainly driven by a non-cash
foreign exchange gain of US$20 million compared with a non-cash
foreign exchange loss of US$14 million during first quarter
2007. During first quarter 2008, the Mexican peso experienced a
1.6% appreciation compared with a 2% depreciation in the same
period last year. In addition, a US$9 million reduction in
interest expense related to the refinancing done at the
beginning of last year also contributed to lower the total
consolidated financing result. These factors more than
compensated a decline in monetary position as this effect was
eliminated at the beginning of year 2008 due to the new
accounting principles in Mexico.
On a LTM basis, total consolidated financing result decreased
30.2% year over year to US$116 million from US$166 million
driven by two favorable factors: a non-cash foreign exchange
gain of US$27 million compared with a non-cash foreign exchange
loss of US$13 million during LTM 2007 driven by a 3%
appreciation experienced by the Mexican peso in LTM 2008
compared with a 1.3% depreciation in the same period last year;
and lower interest expense of US$143 million compared with
US$157 million, as a result of a decrease in the interest rate.
The above mentioned factors more than compensated a lower
monetary position due to the reason mentioned in the previous
paragraph.
Taxes
Total income tax decreased from an expense of US$6 million in
first quarter 2007 to a gain of US$5 million during this
quarter. Accrued income tax increased to US$9 million from US$5
million in first quarter 2007 due to higher taxable profits in
some of the company's foreign operations in the U.S. and Europe.
In addition, during this quarter, the company posted a deferred
income tax gain of US$14 million related to temporary tax
benefits at one of the foreign subsidiaries due to a change in
tax law, which will be reverted during the year compared to an
expense of US$1 million in first quarter 2007.
Consolidated Net Income
During first quarter 2008 the company recorded a consolidated
net income of US$30 million compared to a net loss of US$40
million during the same period last year. This variation is
mainly the result of a combination of several factors: lower
other expenses of US$1 million in first quarter 2008 compared
with US$39 million in the same quarter last year associated with
prepayment fees and other expenses related to the debt
refinancing completed at the beginning of year 2007; a US$31
million decrease in total financing result due to a non-cash
foreign exchange gain compared with a non-cash foreign exchange
loss in first quarter 2007 coupled with lower interest expense;
and an income tax gain of US$5 million during this quarter
compared with an expense of US$6 million in first quarter 2007.
The above mentioned factors more than compensated lower EBIT of
US$42 million compared with US$52 million in the first quarter
last year.
Capital Expenditures (CapEx)
Capital expenditures for the quarter totaled US$65 million,
compared with US$53 million in first quarter 2007. Glass
Containers represented 94% of total capex consumption and was
mainly invested in the four major furnace repairs which will
also contribute to increase capacity for 2008, the transfer of
Vimex's facilities to Toluca and maintenance. Flat Glass
accounted for 6% and was mainly invested in maintenance as well
as in capacity increase and equipment upgrade in the Automotive
business, Vitro America and Cristalglass, Vitro's Flat Glass
subsidiaries in the US and Spain respectively.
Consolidated Financial Position
Net debt, which is calculated by deducting cash and cash
equivalents as well as restricted cash accounted for in current
and other long term assets, increased quarter over quarter by
US$77 million to US$1,264. On a year over year comparison, net
debt increased US$178 million.
As of first quarter 2008, the company had a cash balance of
US$138 million, of which US$104 million was recorded as cash and
cash equivalents and US$34 million was classified as other
current assets. The US$34 million is restricted cash, which is
composed of cash collateralizing debt and cash deposited in a
trust to repay debt and interests on the covenant defeasance of
the Vitro Envases Norteamerica, S.A. de C.V. Senior Notes due
2011 that will be paid in July 2008. Cash collateralizing debt
corresponds to US$1 million recorded at Flat Glass and the cash
deposited in a trust to repay debt and interests corresponds to
US$33 million recorded at Glass Containers.
Consolidated gross debt as of March 31, 2008, totaled US$1,402
million, a quarter over quarter increase of US$29 million and a
year over year decrease of US$64 million. As of first quarter
2008, consolidated short-term debt includes US$30 million
associated with the covenant defeasance of the Senior Notes due
2011 at Vitro Envases Norteamerica.
Cash Flow
Cash flow before CapEx and dividends decreased to negative US$27
million from US$55 million in first quarter 2007. This was
principally the result of higher working capital needs and lower
EBITDA.
Available cash was used to fund the negative US$27 million
mentioned above and the US$65 million in CapEx investments
compared with US$53 million in first quarter 2007.
On a LTM basis, the company recorded cash flow before CapEx and
dividends of US$150 million compared with US$193 million in LTM
2007. The main factors behind this decrease were higher working
capital needs, higher cash taxes paid and lower EBITDA. This
cash flow coupled with available cash was used to fund the
US$254 million CapEx investments, which in part was used to
increase capacity at Glass Containers to satisfy higher demand
from the company's customers.
About Vitro
Headquartered in Monterrey, Mexico, Vitro, S.A.B. de C.V. (BMV:
VITROA; NYSE: VTO), through its two subsidiaries, Vitro Envases
Norteamerica, SA de C.V. and Vimexico, S.A. de C.V., is a
leading global glass producer, serving the construction and
automotive glass markets and glass containers needs of the food,
beverage, wine, liquor, cosmetics and pharmaceutical industries.
VITRO SAB: Fitch Holds B Foreign & Local Issuer Default Ratings
---------------------------------------------------------------
Fitch has affirmed the issuer default ratings and outstanding
debt ratings for Vitro, S.A.B. de C.V.:
-- Foreign currency issuer default rating at 'B';
-- Local currency issuer default rating at 'B';
-- Senior unsecured notes due in 2012, 2013 and 2017 at
'B+/RR3'.
Fitch has also upgraded these national scale ratings:
-- National Scale long-term to 'BBB-(mex)' from 'BB+(mex)';
-- Local Certificados Bursatiles to 'BBB-(mex)' from
'BB+(mex)'.
The rating outlook is stable for all ratings. Approximately
US$1.2 billion of debt is affected, as of Dec. 31, 2007.
The ratings are based on Vitro's strong business position in the
production of glass in Mexico, geographic revenue
diversification and hard currency generation. The company's
export revenues and sales from foreign subsidiaries located in
the United States, Spain, Portugal, Central America and South
America totaled US$1.48 billion in 2007 and represented 57.9% of
total consolidated revenues. More than 80% of Vitro's total
revenues are linked to the U.S. dollar.
Vitro's product diversification is underpinned by its two
business units, Glass Containers and Flat Glass, where the
company has leading market positions in Mexico and North
America. The company's Glass Containers division is the third
largest producer in the world and the largest importer into the
United States, holding the leading market share of the non-
captive glass containers manufacturers in Mexico. Flat Glass
holds the leading market position in Mexico and one of the three
major auto glass producers in the North America Free Trade
Agreement region. The ratings also incorporate the continued
challenging operating environment for Vitro. Average natural
gas prices for 2008 are expected to be higher than in 2007 and
construction and automotive industries cyclicality due to the
slowdown in the U.S. and Mexican economies, could affect the
company's performance.
Vitro's strong business position, operating structure and
favorable market conditions allowed it to improve its operating
results. During 2007 consolidated revenues grew 6.6% to
US$2,560 million and EBITDA grew 5.3% to US$391 million. EBITDA
margin remained relatively stable at 15.3% compared with 15.5%
for the previous year. Operating margins were affected by
failures in natural gas supply during the second and third
quarters. The effect on EBITDA was approximately US$9 million.
In addition, Vitro continued with its maintenance program in
order to update its production facilities. In 2008, the
company's capital expenditures would be approximately
US$250 million, including furnaces maintenance as well as 9%
capacity increase at Glass Containers. Vitro will fund these
investments with internally generated cash flows. Fitch expects
that management will continue with strict costs and expenses
controls, consequently debt levels should remain relatively
stable. At Dec. 31, 2007 Total Debt to Operating EBITDA was 3.4
times, compared to 3.0 in 2006 and 4.0 in 2005.
Vitro's ratings reflect the company's improved financial profile
and capital structure after the refinancing process completed at
the beginning of 2007, which consisted in the offering of US$1
billion senior unsecured notes in two tranches, US$300 million
and US$700 million with final maturity scheduled for 2012 and
2017, respectively. With this transaction, Vitro mitigated
short-term refinancing and liquidity risks and eliminated
structural subordination following the take out of secured
operating subsidiary debt. At Dec. 31, 2007, the company's
liquidity is adequate, with US$186 million in cash and
marketable securities (out of which US$35 million are
restricted) and short-term debt of US$87 million. Major debt
maturities are scheduled until 2012, when the US$300 million
senior notes come due.
The company exports products to more than 50 countries. During
2007, Vitro had sales of US$2.6 billion, EBITDA of US$391
million, exports of US$602 million and foreign sales by
subsidiaries of US$881 million.
Headquartered in Monterrey, Mexico, Vitro, S.A.B. de C.V. (BMV:
VITROA; NYSE: VTO), through its two subsidiaries, Vitro Envases
Norteamerica, SA de C.V. and Vimexico, S.A. de C.V., is a
leading global glass producer, serving the construction and
automotive glass markets and glass containers needs of the food,
beverage, wine, liquor, cosmetics and pharmaceutical industries.
===========
P A N A M A
===========
TITAN PETROCHEMICAL: S&P Cuts Rating to B on Weak Performance
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered its long-term
corporate credit rating on Titan Petrochemical Group Ltd. to 'B'
from 'B+'. The outlook is negative.
At the same time, Standard & Poor's lowered the issue rating on
US$400 million senior unsecured notes guaranteed by Titan to
'B-' from 'B'.
"The rating actions reflect our expectation that Titan is likely
to continue to be under financial pressure over the next 12
months and that its performance is no longer commensurate with a
'B+' rating. The company's expansion of its shipyard
operations, which requires large capital expenditure, is likely
to put further pressure on its funding and leverage," said
Standard & Poor's credit analyst Lawrence Lu.
Titan's various business lines--oil transportation, onshore oil
storage, and petroleum supply chain--will face challenging
conditions in 2008. In the transportation segment, very large
crude carrier freight rates are weak, and operating and
bunkering expenses are rising. Modest demand growth and stiff
competition in the onshore oil storage segment are likely to
continue to weigh on its profitability, although the utilization
rate has improved. Onshore oil storage did not contribute as
much as expected to 2007 results because of weaker-than-expected
demand. Margins in Titan's petroleum supply-chain operations
are likely to continue to erode. The margin squeeze began in
the second half of 2007 because of stiff competition and
negative margins on imports to China, as a result of high crude
prices, which had a knock-on impact on Titan.
Titan's shipyard operations could put pressure on the company's
cash flow as capex mounts. The ship-building business is
showing some progress, with two new orders from third parties
and several others under negotiation. It continues to relay
heavily on orders from related parties, has limited pricing
power, and will be vulnerable further weakening of the U.S.
dollar. The company's plan to expand into the ship-repairing
and offshore engineering business entails sizable capex over the
next few years, putting a further strain on Titan's fiscal
performance.
Titan's liquidity is weak. The company will find it challenging
to meet all of its loan and bond covenants.
Titan Petrochemicals Group Ltd -- http://www.petrotitan.com/--
is an Asian integrated oil logistics, distribution and supply
services provider. It was listed on the Hong Kong Stock
Exchange in 2002. Headquartered in Hong Kong, its operations
are spread over Singapore, Malaysia and China. It also operates
in Russia and Panama. It manages 25 tankers and has on-shore
storage facilities in Guangdong, Fujian and Shanghai.
=======
P E R U
=======
GLOBAL CROSSING: Launches VSAT Satellite Platform in Peru
---------------------------------------------------------
Global Crossing Ltd. is launching a new Very Small Aperture
Terminal (VSAT) satellite platform to enhance the satellite
services of its accessibility portfolio. The array of new and
expanded services supported by this platform includes Global
Crossing Internet Protocol (IP) solutions, such as Global
Crossing Direct IP Satellite services, and Global Crossing
Broadband Omniwhere, both recently introduced in Latin America
following the acquisition of Impsat Fiber Networks.
VSATs are earth stations with very small antennae that are
typically used in point-to-multipoint data networks that carry
data, voice and video signals. This new satellite
infrastructure allows for the concentration of Global Crossing
customers' IP satellite links at the company's teleport, located
in the Santiago de Surco district. The technology is designed
to allow for the use of simple, compact equipment in order to
link remote locations, yielding faster installation times,
greater mobility and expanded flexibility for customers.
"At Global Crossing we seek to satisfy the growing demand for
integrated solutions that are cost-effective and that provide a
complete architecture," said Global Crossing's head of sales and
services in Peru, Dante Passalacqua. "To that end, we're using
the most advanced technology available on the market. With the
new hub, our clients will be able to transmit voice, data and
video easily, quickly and securely."
Most other hubs -- the central component in the VSAT satellite
platform -- that are installed in the region operate on the Ku
frequency (between 11 and 14 GHz). This frequency is highly
sensitive to adverse weather conditions such as the strong rain
showers that occur in large parts of Peru and that can
negatively affect service performance and availability. Global
Crossing's new VSAT hub, however, operates on the C frequency
(between 4 and 6 GHz), thereby guaranteeing continuity of
mission-critical processes -- even in the toughest weather.
The hub's current configuration will allow for the immediate
handling of more than 500 high-traffic satellite stations.
Since the hub is a modular platform, that handling capacity can
be expanded as needed. This hub is part of Global Crossing's IP
Solutions and Continuity Solutions portfolio and is an ideal
solution for support networks -- serving as an alternative to
earth links and giving these networks the highest possible
availability.
About Global Crossing Ltd.
Headquartered in Florham Park, New Jersey, Global Crossing Ltd.
(NASDAQ: GLBC) -- http://www.globalcrossing.com/-- provides
telecommunication services over the world's first integrated
global IP-based network. Global Crossing serves many of the
world's largest corporations, providing a full range of managed
data and voice products and services. The company filed for
chapter 11 protection on Jan. 28, 2002 (Bankr. S.D.N.Y. Case No.
02-40188). When the Debtors filed for protection from their
creditors, they listed US$25,511,000,000 in total assets and
US$15,467,000,000 in total debts. Global Crossing emerged from
chapter 11 on Dec. 9, 2003.
Global Crossing's Latin American business has operations in
Argentina, Brazil, Chile, Colombia, Ecuador, Panama, Peru,
Mexico, Venezuela and the United States (Florida). It also has
operations in the United Kingdom.
* * *
At Sept. 30, 2007, Global Crossing Ltd.'s balance sheet showed
total assets of US$2.6 billion, total debts of US$2.7 billion
and a US$74 million stockholders' deficit.
As reported in the Troubled Company Reporter-Latin America on
Nov. 8, 2007, Global Crossing Ltd. said in a statement that its
net loss increased 75% to US$89 million in the third quarter
2007, compared to US$51 million in the third quarter 2006.
====================
P U E R T O R I C O
====================
CELESTICA INC: S&P Changes Outlook to Stable; Holds 'B+' Ratings
----------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on
Toronto-based electronic manufacturing services provider
Celestica Inc. to stable from negative. At the same time, S&P
affirmed the ratings, including the 'B+' long-term corporate
credit rating, on the company. At March 31, Celestica had
US$771 million of debt outstanding.
"The outlook revision reflects a meaningful improvement in the
company's operational performance in the past three quarters
characterized by stabilized revenue losses and improved
operating margins," said Standard & Poor's credit analyst Madhav
Hari. In addition, the company's credit metrics and liquidity
measures have improved to levels that are more consistent with
the ratings.
The ratings on Celestica reflect the highly competitive and
consolidating electronic manufacturing services industry;
difficult market conditions characterized by a high degree of
volatility in the communications and IT infrastructure end-
markets; minimal revenue growth; weak, albeit improving,
operating margins; and weak credit metrics. These factors are
partially offset by the company's Tier 1 position in the EMS
sector, good long-term relationships with large customers, early
signs of a meaningful turnaround in its operations, and healthy
liquidity.
More than 70% of the company's revenues come from IT
infrastructure, telecom, and communications end-markets, which
is a higher concentration than other Tier 1 EMS providers. The
latter two end-markets have been experiencing weaker-than-
expected demand, especially with respect to Celestica's major
customers.
The stable outlook reflects S&P's view that Celestica has
largely stemmed revenue declines, significantly improved its
cost structure, and bolstered its liquidity. Nevertheless, high
debt leverage and weak visibility from the company's end markets
limit consideration for higher ratings in the near term.
Consideration for a positive outlook will depend on the
company's ability to meet S&P's 2008 expectations of flat
revenue growth and a 2.5% operating margin. S&P would consider
a negative outlook if end markets deteriorated substantially and
rapidly, causing profit levels and credit metrics to weaken.
Headquartered in Toronto, Celestica Inc. (NYSE:CLS) --
http://www.celestica.com/-- provides innovative electronics
manufacturing services to companies in the computing,
communications, consumer, industrial, and aerospace and defense
end markets. As reported in the Troubled Company Reporter on
Feb. 5, 2008, Celestica reported net loss on a generally
accepted accounting principles basis for the fourth quarter of
US$11.7 million compared to GAAP net loss of US$60.8 million for
the same period last year.
Celestica operates a highly sophisticated global manufacturing
network with operations in Brazil, China, Ireland, Italy, Japan,
Malaysia, Philippines, Puerto Rico, and the United Kingdom,
among others.
DELPHI CORP: Ch. 11 Exit to be Delayed for Months, GM Chief Says
----------------------------------------------------------------
According to XFN-ASIA and Thomson Financial, General Motors
Corp. Chief Executive Rick Wagoner had acknowledged to reporters
at the Beijing Auto Show that Delphi Corp.'s emergence from
Chapter 11 protection is "unlikely to be imminent."
Delphi was already set to exit Chapter 11 in April following the
successful syndication of its US$6,100,000,000 exit financing,
but an investor group, led by Appaloosa Management, LLP,
withdrew from its prior commitment to provide up to
US$2,550,000,000 in equity financing to Delphi.
"The major investor indicated that they wouldn't proceed with
their commitment to do the investment, so now Delphi has to go
back and try and restructure the financing. The good news was
that in a very difficult financial market they were able to
arrange adequate debt financing to come out," Mr. Wagoner said.
"Delphi needs to come up with a different mix of financing
structure to get investors who are interested. I don't think
this is something we will see resolved imminently, but a lot of
the hard work to get out of bankruptcy . . . has been done so
there's a good base to build on here," he said.
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.
Based 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, Issue No. 125; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000)
DELPHI CORP: To Seek US$4.1B Loan Refinancing, Adjusts Forecasts
----------------------------------------------------------------
Delphi Corp. said, in a filing with the Securities and Exchange
Commission, that it will meet with investors to discuss its plan
to obtain US$4,100,000,000 of financing, comprising:
Tranche Amount/Nature of Loan
------- ---------------------
A US$1,000,000,000 first priority revolving
credit facility
B US$600,000,000 first priority term loan
C US$2,500,000,000 second priority term loan
As previously reported, Delphi is seeking to amend and extend
its existing credit facility until the earlier of Dec. 31, 2008,
or the date of the substantial consummation of a reorganization
plan that is confirmed by the Bankruptcy Court.
Delphi has revised projected revenue, EBITDAR, debt levels and
liquidity information, which differ from its previously
disclosed projections in the disclosure statement attached to
its Court-confirmed Joint Plan of Reorganization.
According to John D. Sheehan, vice president and chief
restructuring officer, the Prior Projections have been adjusted
to reflect:
(i) Delphi's delayed emergence from Chapter 11, including
deferral of net amounts that would have been paid by
General Motors Corporation to Delphi under certain
restructuring agreements, the retiming of divestiture
transactions, and the reversal of adjustments related to
fresh start accounting and certain recapitalization
transactions which were to take place upon emergence;
(ii) changes in overall market and economic conditions,
including changes in projected GM North American volumes
from 3.8 million to 3.6 million units, changes in the
projected volumes of other select North American
customers, and increased commodity costs; and
(iii) projected advances from time to time of up to an
aggregate outstanding amount of US$650,000,000 from GM in
anticipation of the implementation of certain
restructuring agreements.
Delphi notes that while GM has agreed to make advances in
anticipation of the effectiveness of the restructuring-related
agreements, there can be no assurances that the GM agreement
will actually become effective.
Delphi said that projected 2008 revenue will increase from
US$19,708,000,000 in the Disclosure Statement to
US$21,034,000,000 in the current projections due principally to
the retiming of divestiture activity.
The company notes, however, that 2008 projected EBITDAR will
decline from US$1,577,000,000 in the Disclosure Statement to
US$999,000,000 in the current projections. The deterioration is
primarily due to an increase in pension and other postretirement
benefit expense retained by Delphi due to the retiming of its
assumed emergence of US$781,000,000, partially offset by
US$253,000,000 resulting from a difference in definition of
EBITDAR between the Disclosure Statement and the Refinanced DIP
Credit Facility and US$31,000,000 due to the retiming of
divestiture activity.
Supplemental Financial Information
A. Borrowing Base (in Millions)
Available
Gross Balance
at 12/31/07 as
as defined by Adjusted Adjusted
Credit Facility Advance Availability
--------------- ------- ------------
U.S. accounts receivable US$2,521 85% US$768
U.S. Inventory 1,225 75% 649
U.S. PP&E N/A 369
Less carve-out N/A (122)
--------
Borrowing Base Availability US$1,664
========
B. DIP Collateral Coverage (in Millions)
As of 12/31/07
--------------
Accounts & Non-Debtors Note Receivables
Debtor Continuing Operations US$2,123
Debtor Discontinued Operations 251
--------
Total Collateral US$2,374
========
Inventory, net
Debtor Continuing Operations US$823
Debtor Discontinued Operations 184
--------
Total Collateral US$1,007
========
PP&E, net book value
Debtor Continuing Operations 1,446
Debtor Discontinued Operations 291
--------
Total Collateral US$1,737
========
C. EBITDAR Reconciliation (in Millions)
Discontinued
Consol. Continuing Operations
12/31/07 12/31/07 12/31/07
-------- -------- --------
Net Income
(+)Income Taxes (US$3,065) (US$2,308) (US$757)
(+)Interest Expense (514) (522) 8
(+)Interest Income 772 769 3
(+)Deprec. & Amortization 1,282 1,012 270
-------- -------- --------
EBITDA (1,595) (1,117) (478)
(+)Securities and Litigation
Charge 343 343 -
US Employee Workforce
Transition Charges 244 212 32
Other Restructuring 1,414 681 733
-------- -------- --------
(+)Total Restructuring 1,658 893 765
-------- -------- --------
LTM EBITDAR US$406 US$119 US$287
======== ======== ========
Subsidiary EBITDAR Reconciliation
EBITDAR of
1st tier foreign subsidiaries US$610
EBITDAR excluding
1st tier foreign subsidiaries (204)
--------
Total Consolidated EBITDAR (US$406)
========
D. Financial Review (in Millions)
-- Summary Model Financial Information
2007 2008
---- ----
GM Sales US$10,706 US$6,621
Non-GM Sales 15,454 14,414
-------- --------
Total Sales 26,160 21,034
-------- --------
Net Loss (US$3,065)
(US$1,790)
======== ========
Interest, net 702 457
Income Taxes (514) 180
Depreciation and Amortization 1,282 1,095
OPEB Expense Less Payments 386 243
Professional Fees &
Other Restructuring Costs 174 244
Restructuring Expense 1,658 590
Other (3)
(19)
EBITDAR US$963 US$999
Capital Expenditures US$646 US$779
======== ========
-- Summary Credit Agreement Model Liquidity
May Jun Jul Aug Sep Oct Nov Dec
--- --- --- --- --- --- --- ---
Cash
U.S. Cash 25 25 35 177 172 70 25 25
Non-US Cash 1,112 1,033 986 997 934 988 1,000 930
----- ----- ----- ----- ----- ----- ----- -----
Consol. Cash 1,137 1,057 1,020 1,174 1,105 1,491 1,025 955
Availability
DIP 608 478 486 322 332 433 480 477
----- ----- ----- ----- ----- ----- ----- -----
Cash &
Availability 1,745 1,535 1,506 1,497 1,438 1,491 1,505 1,432
----- ----- ----- ----- ----- ----- ----- -----
GM Agreement
Balance - $45 - $335 $468 $573 $643 $584
===== ===== ===== ===== ===== ===== ===== =====
About Delphi Corp.
Based 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, Issue No. 125; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000)
DELPHI CORP: Wants to Obtain US$650 Million Credit from GM
----------------------------------------------------------
Delphi Corp. and its debtor-affiliates seek authority from the
U.S. Bankruptcy Court for the Southern District of New York to:
(i) obtain extensions of credit of up to US$650 million from
General Motors Corp., and
(ii) pay undisclosed fees in connection with the loan.
Delphi has filed with the Court a draft of its agreement with
GM, pursuant to which a GM affiliate will provide US$650 million
in advances to Delphi. GM has agreed to make accommodations in
the form of the advances, in anticipation of the effectiveness
of their Master Restructuring Agreement and Global Settlement
Agreement, both dated Sept. 6, 2007, and amended Dec. 7, 2007.
The April 24 draft of the parties' agreement provides for these
terms:
Borrower Delphi Corp.
Guarantors Other Debtors
Lender General Motors Corp.
Commitment GM will provide loans to Delphi beginning
May 7, 2008:
(a) prior to June 1, 2008, in an
aggregate outstanding principal
amount not to exceed
US$200,000,000,
(b) from and after June 1, 2008, and
prior to July 1, 2008, in an
aggregate outstanding principal
amount not to exceed US$300,000,000
and
(c) from and after July 1, 2008, in an
aggregate outstanding principal
amount not to exceed
US$650,000,000.
Scheduled
Termination Date The earliest of (a) Dec. 31, 2008, (b)
the date on or after the effectiveness of
the amendments to each of the Master
Restructuring Agreement and the Global
Settlement Agreement, on which GM or its
affiliates has paid to or for the credit
or the account of the Debtors from and
after the Effective Date an amount equal
to or greater than US$650,000,000 in the
aggregate under the agreements and (c)
the date on which a Reorganization Plan
becomes effective.
Covenants The parties agree to, among other things,
use their good-faith, commercially
reasonable efforts to (a) negotiate and
enter into amendments to each of the
Global Settlement Agreement and Master
Restructuring Agreement as soon as
practicable (the parties desire to enter
into amendments on or prior to July 1,
2008), and (b) obtain the consent of
Delphi's statutory committees with
respect to the amendments.
Interest Rates Adjusted LIBO Rate plus [__]%
Interest Payments Interest payment date will mean the last
day of each March, June, September and
December, commencing Sept. 30, 2008.
Default Interest Rate for Advances plus 2.0%.
Priority The Debtors' obligations to GM will
constitute allowed claims having priority
pursuant to Section 503(b)(1) of the
Bankruptcy Code. GM's set-off rights
will rank ahead of general unsecured
claims at all times.
Conditions to
Effectiveness The GM Agreement will be effective, when,
among other things, the Court approves
an amendment to the Amended and Restated
Revolving Credit, Term Loan and Guaranty
Agreement, dated as of Nov. 20, 2007,
originally signed by JPMorgan Chase Bank,
N.A., as administrative agent, and
Citicorp USA, Inc., which amendment will
extend the termination date thereunder to
a date no earlier than Dec. 31, 2008.
Delphi's request to obtain extensions of credit from GM is
scheduled for hearing on April 30. Objections are due April 28.
The final terms of the GM Agreement is subject to negotiations
between GM and the Debtors. A copy of the current form of the
Agreement is available for free at:
http://bankrupt.com/misc/Delphi_GM_Agreement.pdf
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.
Based 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, Issue No. 126; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000)
DIRECTV GROUP: Launches Prepaid Television Service in Chile
-----------------------------------------------------------
DirecTV Group Inc. has launched a prepaid television offering in
Chile.
Business News Americas relates that the system will be available
initially in:
-- Region V,
-- Region VI,
-- Region VII,
-- Region VIII, and
-- 15 municipalities in Santiago.
DirecTV Group's General Manger in Chile Francisco Mandiola told
BNamericas that the firm already launched the prepaid television
service in Venezuela, where 50% of the company's sales are "via
the prepaid format."
BNamericas notes that "multiple points of sale will be available
to facilitate the introduction of the service. The kits for the
product include antenna, decoder, remote control and smartcard
and cost CLP49.999."
According to BNamericas, the prepaid television service will
come in two content packages:
-- one valued at CLP15,000 per month, and
-- one at CLP21,000 a month.
The report says that clients can pay CLP700 per day or CLP3,500
per week.
DirecTV Group wants to have 30,000 new subscriptions for its
prepaid offering in Chile this year and the firm is planning to
launch the prepaid television service in Peru and Colombia,
BNamericas states, citing Mr. Mandiola.
Headquartered in El Segundo, California, The DirecTV Group Inc.
(NASDAQ:DTV) -- http://www.DirecTV.com/-- provides digital
television entertainment in the United States and Latin America.
The company's two business segments, DirecTV U.S. and DirecTV
Latin America, are engaged in acquiring, promoting, selling
and/or distributing digital entertainment programming via
satellite to residential and commercial subscribers. DirecTV
Holdings LLC and its subsidiaries are a provider of direct-to-
home digital television services and a provider in the multi-
channel video programming distribution industry in the United
States. DTVLA is a provider of DTH digital television services
throughout Latin America. In January 2007, the company acquired
Darlene Investments LLC's 14.1% equity interest in DirecTV Latin
America, LLC. DirecTV Latin America LLC is a multinational
company, which, as a result of this transaction, became a wholly
owned subsidiary of the company. The DIRECTV Latin America
segment provides digital direct-to-home digital television
services to approximately 1.6 million subscribers in 27
countries, including Brazil, Argentina, Venezuela, and Puerto
Rico.
* * *
As of Feb. 9, 2008, The DIRECTV Group Inc. still carries
Standard & Poor's Ratings Services' 'BB' corporate credit and
'BB-' senior unsecured debt rating given on April 3, 2007. The
outlook remains stable.
FORD MOTOR: Shareholder Tracinda Offers to Buy 20MM Ford Stake
--------------------------------------------------------------
Tracinda Corporation intends to make a cash tender offer for up
to 20 million shares of common stock of Ford Motor Company at a
price of US$8.50 per share. The offer price represents a 13.3%
premium over Ford's closing stock price of US$7.50 on April 25,
2008 and a 38.7% premium over Ford's closing stock price on
April 2, 2008, the day upon which Tracinda began accumulating
shares in the company.
The shares to be purchased pursuant to the offer represent
approximately 1% of the outstanding shares of Ford common stock.
Tracinda Corporation, of which Kirk Kerkorian is the sole
shareholder, currently owns 100 million shares of Ford common
stock, which represents approximately 4.7% of the outstanding
shares. Tracinda's average cost for such shares is
approximately US$6.91 per share. Upon completion of the offer,
Tracinda would beneficially own 120 million shares of Ford
common stock, or approximately 5.6% of the outstanding shares.
Mr. Kerkorian paid an initial US$691 million and intends to
disburse another US$170 million, Bill Koenig and Jeff Green of
Bloomberg News report.
According to Ford Executive Chairman Bill Ford and Ford
President and CEO Alan Mulally: "We welcome confidence in Ford
and the progress we are making on our transformation plan. Any
investor can purchase Ford shares, which are sold on the open
market. The Ford team remains focused on executing our plan to
transform Ford into a lean global enterprise delivering
profitable growth for all."
Tracinda has been following Ford closely since the company
released its fourth quarter 2007 results which indicated that
Ford's management was starting to achieve highly meaningful
traction in its turnaround efforts. Last week this was
reinforced by Ford's first quarter 2008 results, achieved
despite the difficult U.S. economic environment. Tracinda
believes that Ford management under the leadership of Chief
Executive Officer Alan Mulally will continue to show significant
improvements in its results going forward.
As reported in the Troubled Company Reporter on April 25, 2008,
Ford reported net income of US$100 million for the first quarter
of 2008. This compares with a net loss of $282 million in the
first quarter of 2007.
Once the tender offer is commenced, offering materials will be
mailed to Ford stockholders and filed with the Securities and
Exchange Commission. Ford stockholders are urged to read the
offering materials when they become available because they will
contain important information.
The tender offer will be subject to customary conditions for
transactions of this type, including expiration of any
applicable waiting period under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended. Tracinda's offer will not
be subject to financing.
However, analysts warn Ford on Tracinda's designs on the
automaker, Matthew Dolan and Jeff Bennett of The Wall Street
Journal relate. JP Morgan Stanley & Co. Inc.'s Jonathan
Steinmetz predicts that like General Motors Corp., Tracinda
might, at first, be a passive shareholder, but will later seek a
board seat, criticize management leadership skills and instigate
the sale of non-core assets or potential industry consolidation.
The shareholder will eventually pull out from the company.
According to WSJ citing Peter Nesvold of Bear Stearns, Tracinda
first bought a stake, in both automakers, of just under 5% and
then offered to buy additional stake at a 13% premium.
Bloomberg recounts that Ford's trading stock rose 10% in the New
York Stock Exchange on Monday.
Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) --
http://www.ford.com/-- manufactures or distributes automobiles
in 200 markets across six continents. With about 260,000
employees and about 100 plants worldwide, the company's core and
affiliated automotive brands include Ford, Jaguar, Land Rover,
Lincoln, Mercury, Volvo, Aston Martin, and Mazda. The company
provides financial services through Ford Motor Credit Company.
The company has operations in Japan in the Asia Pacific region.
In Europe, the company maintains a presence in Sweden, and the
United Kingdom. The company also distributes its brands in
various Latin American regions, including Argentina and Brazil.
* * *
As reported in the Troubled Company Reporter-Latin America on
March 31, 2008, Standard & Poor's Ratings Services said that the
ratings and outlook on Ford Motor Co. and Ford Motor Credit Co.
(both rated B/Stable/B-3) were not affected by Ford's
announcement of an agreement to sell its Jaguar and Land Rover
units to Tata Motors Ltd. (BB+/Watch Neg/--) for USUS$2.3
billion (before US$600 million of pension contributions by Ford
for Jaguar-Land Rover).
As reported in the Troubled Company Reporter-Latin America on
Feb. 15, 2008, Fitch Ratings affirmed the Issuer Default Ratings
of Ford Motor Company and Ford Motor Credit Company at 'B', and
maintained the Rating Outlook at Negative.
In November 2007, Moody's Investors Service affirmed the long-
term ratings of Ford Motor Company (B3 Corporate Family Rating,
Ba3 senior secured, Caa1 senior unsecured, and B3 probability of
default), but changed the rating outlook to Stable from Negative
and raised the company's Speculative Grade Liquidity rating to
SGL-1 from SGL-3. Moody's also affirmed Ford Motor Credit
Company's B1 senior unsecured rating, and changed the outlook to
Stable from Negative. These rating actions follow Ford's
announcement of the details of the newly ratified four-year
labor agreement with the United Auto Workers.
FORD MOTOR: Inks Master Economics Offer Agreement with CAW
----------------------------------------------------------
Following early background negotiations, Ford Motor Company of
Canada Ltd. and the Canadian Auto Workers union have reached an
agreement on a Master Economics Offer that will now become the
centerpiece of all-out collective bargaining aimed at reaching a
tentative agreement between the two sides later this week.
For a full tentative agreement to be reached, agreement also
must now be attained on all local agreements, such as skilled
trades, health and safety. That tentative agreement must then
be ratified by CAW members at all Canadian locations. The
current collective agreement expires at midnight September 16.
The Master Economics Offer was endorsed unanimously by members
of the CAW-Ford Master and local bargaining committees at a
special meeting in Toronto on Monday.
Highlights of the Master Economics Offer:
* Three year contract, expiring midnight Sept. 14, 2011;
* No changes in base wages;
* No two-tier system for wages, pensions or benefits;
* Extended the life of the St. Thomas assembly plant through
life of agreement (to 2011) The product commitment was
scheduled to end in 2010;
* COLA payments frozen for remainder of current contract, and
first year of the new contract. Quarterly COLA wage
adjustments resume under existing formula Dec. 2009;
* US$2200 "productivity & quality" bonus to be paid upon
ratification;
* Inflation-indexed pension increases for both existing and
new retirees in second and third year;
* Significant savings in health costs (stricter cap on long-
term care, 10% co-pay on drugs to US$250 annual maximum per
family);
* Modest improvements in health benefits and spousal insurance
benefit;
* New-hire grow-in system, where wages, COLA, SUB benefits,
and time-off provisions are phased in (starting at 70% of
base wages) over the first three years of work; after three
years, wages reach 100% of base wages;
* Reduction in vacation pay by 40 hours per year, compensated
with special US$3500 cash payment in January 2009;
* Improved restructuring benefits and renewed income security
funds;
* Commitment to explore Canadian opportunities to establish a
pre-funded, off-balance-sheet Retiree Health Benefit Fund.
The offer includes a mixture of modest gains and cost savings
that in the CAW’s judgment will ensure that Canadian facilities
over the life of the agreement will remain in the ballpark for
new investment opportunities.
Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) --
http://www.ford.com/-- manufactures or distributes automobiles
in 200 markets across six continents. With about 260,000
employees and about 100 plants worldwide, the company's core and
affiliated automotive brands include Ford, Jaguar, Land Rover,
Lincoln, Mercury, Volvo, Aston Martin, and Mazda. The company
provides financial services through Ford Motor Credit Company.
The company has operations in Japan in the Asia Pacific region.
In Europe, the company maintains a presence in Sweden, and the
United Kingdom. The company also distributes its brands in
various Latin American regions, including Argentina and Brazil.
* * *
As reported in the Troubled Company Reporter-Latin America on
March 31, 2008, Standard & Poor's Ratings Services said that the
ratings and outlook on Ford Motor Co. and Ford Motor Credit Co.
(both rated B/Stable/B-3) were not affected by Ford's
announcement of an agreement to sell its Jaguar and Land Rover
units to Tata Motors Ltd. (BB+/Watch Neg/--) for USUS$2.3
billion (before US$600 million of pension contributions by Ford
for Jaguar-Land Rover).
As reported in the Troubled Company Reporter-Latin America on
Feb. 15, 2008, Fitch Ratings affirmed the Issuer Default Ratings
of Ford Motor Company and Ford Motor Credit Company at 'B', and
maintained the Rating Outlook at Negative.
In November 2007, Moody's Investors Service affirmed the long-
term ratings of Ford Motor Company (B3 Corporate Family Rating,
Ba3 senior secured, Caa1 senior unsecured, and B3 probability of
default), but changed the rating outlook to Stable from Negative
and raised the company's Speculative Grade Liquidity rating to
SGL-1 from SGL-3. Moody's also affirmed Ford Motor Credit
Company's B1 senior unsecured rating, and changed the outlook to
Stable from Negative. These rating actions follow Ford's
announcement of the details of the newly ratified four-year
labor agreement with the United Auto Workers.
MICRON TECHNOLOGY: S&P Holds 'BB-' Rating on Ample Liquidity
------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its ratings on
Micron Technology Inc., including its 'BB-' corporate credit and
senior unsecured debt ratings. S&P removed all the ratings from
CreditWatch, where they had been placed with negative
implications on March 10, 2008. The outlook is negative.
At the same time, Standard & Poor's assigned a '3' recovery
rating to Micron's US$1.3 billion senior unsecured notes,
indicating the expectation for meaningful (50% to 70%) recovery
in the event of a payment default.
"The rating action reflects our expectation that the company
will continue to maintain a moderate capital structure with
ample liquidity in the intermediate term," said Standard &
Poor's credit analyst Bruce Hyman. "However, Micron's near- to
intermediate-term operating results will be pressured by weak
economic conditions that will constrain an increase in demand in
the company's NAND and traditional DRAM businesses."
The ratings on Boise, Idaho-based Micron reflect the company's
current profitability challenges and likely negative free cash
flows during the latest investment cycle in the semiconductor
memory industry. These factors are offset partially by the
company's substantial liquidity and moderate capitalization.
Micron is the fifth-largest DRAM supplier, with about a 10%
market share, having substantially reduced its exposure to the
commodity market in the past few years.
About Micron
Headquartered in Boise, Idaho, Micron Technology, Inc. --
http://www.micron.com/-- (NYSE:MU) is a provider of advanced
semiconductor solutions. Through its worldwide operations,
Micron manufactures and markets DRAMs, NAND flash memory, CMOS
image sensors, other semiconductor components, and memory
modules for use in leading-edge computing, consumer, networking,
and mobile products. Outside the United States, the company has
subsidiaries in the United Kingdom, Japan, Singapore, Germany,
China, Italy, and Puerto Rico.
=============
U R U G U A Y
=============
COOPERATIVA DE AHORRO: Fitch Revises Stable Outlook to Positive
---------------------------------------------------------------
Fitch Ratings has affirmed Fucerep-Cooperativa de Ahorro y
Credito's ratings:
-- Foreign and local currency issuer default rating at
'B-';
-- National long-term rating at 'BB(uy)';
-- Support floor rating at 'NF';
-- Support rating at '5'.
Fitch has revised the rating outlook to positive from stable.
The ratings assigned to Fucerep reflect its small size, modest
capitalization and good performance in the last two years. The
ratings also reflect the gradual implementation of a restricted
license until 2010.
The approval of the restricted license by the Central Bank of
Uruguay in November 2006, allows Fucerep to concentrate on its
current business plan.
Fucerep's performance improved significantly in 2007, mainly
because of its growing in financial revenues. Fitch considers
the cooperative's decisions and the economic situation in
Uruguay -- and Uruguayan financial system -- a strong platform
to develop its activities and to get its objectives.
Low-quality loans have increased in 2007 but delinquency ratios
are in similar levels in comparison with 2006 because of
increases in loan's stock. Loan loss reserves improve but there
is still a risk for Fucerep's equity.
Deposits from residents were the main source of funds, with
35.4% of the total being dollar-denominated. Liquidity is
adequate, with liquid assets representing 52.6% of deposits at
year-end 2007.
Fucerep's capitalization has improved. Fitch considers that a
strong capitalization level is very important for the company's
future. Thus, the cooperative's limited ability to raise fresh
capital create a limit in its growing.
Fucerep is a credit cooperative that has operated in Uruguay
since 1974 and offers services in retail banking, with a focus
on individuals. Fucerep was founded by employees from Banco de
la Republica Oriental del Uruguay or BROU, which explains its
close ties to the bank and concentration of loans among BROU's
employees. At end of 2006, Fucerep reported assets and equity
of US$9.9 million and US$1.9 million, respectively.
FEDERACION URUGUAYA: Fitch Affirms Issuer Default Ratings at B
--------------------------------------------------------------
Fitch Ratings has affirmed Federacion Uruguaya de Cooperativas
de Ahorro y Credito's ratings:
-- Foreign and local currency issuer default ratings at 'B';
-- National long-term rating at 'BBB-(uy)';
-- Support floor rating at 'NF';
-- Support rating at '5'.
The rating outlook is stable.
The ratings assigned to Federacion Uruguaya are based on its
improved performance over the past few years, as well as its
decision to leave financial intermediation, which was took in
order to reduce costs. The ratings also take into account its
niche franchise and small position within the Uruguayan
financial system, but also reflect its good liquidity position
and strong capitalization.
The cooperative's performance was very good in 2007, better than
that of the Uruguayan banking system and cooperatives. In 2007,
Federacion Uruguaya consolidated its positive trend and posted
profits for the fourth year in a row, which Fitch evaluates
positively.
For this year Fitch forecast good business environment in
Uruguay, in particular for consumption. However, competition
could be stronger because banks are more interested in this kind
of business.
Asset quality has historically been somewhat weak due to
Federacion Uruguaya's focus on the low-income segment of the
population. However, the loan loss reserve coverage was adequate
at 100% of past due loans (loans 60 days or more overdue) and
the portion not covered of non-performing loan represented an
acceptable 11.4% of the cooperative's equity.
During 2007, Federacion Uruguaya decided to stop financial
intermediation and, as a result of that decision, it paid back
the total amount of deposits. New funding will be based in its
capital and bank loans.
Federacion Uruguaya has maintained good levels of liquidity.
Because of the new funding structure the cooperative could
operate with lower levels of liquidity. The balance sheet is
well matched in terms of currency and tenors.
Capitalization is good. Although minimum capital requirements
will be lower than before (8% of risk adjusted assets),
Federacion Uruguaya's capital adequacy ratios are strong.
Established in Uruguay in 1972, Federacion Uruguaya de
Cooperativas de Ahorro y Credito is a financial cooperative that
focuses mainly on small and micro-businesses, as well as
consumers. In 2002, the cooperative signed a contract with
another Uruguayan credit cooperative, COFAC, whereby the latter
transferred 70% of its assets and liabilities to COFAC.
Recently, in the face of higher nominal capital requirements,
Federacion Uruguaya requested authorization from the Central
Bank of Uruguay to operate as a financial cooperative with
restricted activities.
HSBC BANK (URUGUAY): Solid Structure Cues Fitch to Hold BB+ Rtg.
----------------------------------------------------------------
Fitch Ratings affirmed HSBC Bank (Uruguay) S.A.'s ratings:
-- Foreign currency issuer default rating at 'BB+';
-- Local currency issuer default rating at 'BBB-';
-- National long-term rating at 'AAA(uy)';
-- Support rating at 3.
The rating outlook is stable.
The international ratings of HSBC Bank (Uruguay) are constrained
by those of the sovereign. The bank's foreign currency IDR is
at the country ceiling, while its local currency IDR is two
notches above that of the Uruguayan sovereign. These ratings,
along with the bank's support rating, reflect the bank's solid
ownership structure and its shareholder's strong commitment to
the bank.
HSBC Bank (Uruguay)'s performance has been on a positive trend
since 2005, with operating income growing as a result of its
increasing activity level. However, the bank's net income in
2007 was affected by foreign exchange losses and by a sharp
increase in non-interest expenses.
In 2007, the bank launched a growth plan, with ambitious targets
in terms of market share in lending to local individuals and
companies. This plan requires hefty investments that will
affect the bank's profitability in the next two years but will
then bear fruit.
Asset quality has improved significantly. At end-2007, past-due
loans (more than 60 days overdue, as per the local definition)
represented only 0.1% of the total.
The primary funding sources are non-resident deposits, which
made up 74% of total deposits at end-2007, the majority of these
corresponding to Argentine depositors. Liquidity remains high,
and is enhanced by credit lines available from HSBC USA.
The bank's capitalization is adequate. Although equity
represented only 6.4% of total assets (or 21.3% of risk-weighted
assets) at end-2007, Fitch believes that the strength of the
bank's parent compensates for this, as demonstrated by the
various capital increases carried out since 2003.
HSBC Bank (Uruguay) offers personal banking services as well as
commercial banking services to important clients of the HSBC
Group. HSBC Bank (Uruguay) is fully owned by HSBC Latin America
Holdings (UK) Limited, which in turn is a subsidiary of HSBC
Holdings Plc.
=================
V E N E Z U E L A
=================
GOODYEAR TIRE: Earns US$147 Million in 2008 First Quarter
---------------------------------------------------------
The Goodyear Tire & Rubber Company reported record first quarter
sales and its highest first quarter net income in several years.
Goodyear's first quarter 2008 sales were US$4.9 billion, a 10%
percent increase compared with the 2007 quarter, offsetting
lower volumes with higher prices, a richer product mix and
favorable currency translation.
Improved pricing and product mix in all four businesses drove
revenue per tire up 7% over the 2007 quarter, reflecting the
company's successful strategy to focus on high-value-added
tires. Lower volume primarily resulted from weak original
equipment markets in North America as well as soft consumer
replacement demand in North America and Europe, particularly for
low-value-added tires.
"Our excellent first quarter results demonstrate the success of
our strategies to grow our higher-margin premium product lines,
reduce costs and pay down debt," said Robert J. Keegan, chairman
and chief executive officer.
"Each of our four businesses improved margins and operating
income as we capitalized on attractive growth opportunities in
targeted market segments," he said.
"While the economy remains a concern, we continue to be
confident about the opportunities we see in the market and our
ability to take advantage of them," Keegan said. "Over the last
five years, our strategic decisions have better positioned
Goodyear to face an economic downturn and to emerge as a
stronger competitor."
Goodyear said it made additional progress during the first
quarter on its plan to achieve US$1.8 billion to US$2 billion in
gross cost savings by the end of 2009. "We have now achieved
more than US$1.2 billion in savings since beginning this plan
and remain on target to reach our four-year goal," Keegan said.
Segment operating income set a first quarter record at US$367
million in 2008, up 62% from US$226 million in the strike-
affected 2007 first quarter. Gross margin was 19.9% for the
2008 first quarter compared to 16.8 percent last year.
Segment operating income benefited from improved pricing and
product mix of US$157 million, which more than offset increased
raw material costs of US$13 million.
Favorable currency translation positively impacted sales by
US$341 million and segment operating income by US$27 million in
the quarter.
First quarter 2008 net income from continuing operations was
US$147 million (60 cents per share). This compares to a loss
from continuing operations of US$110 million (61 cents per
share) in the year-ago quarter. Including discontinued
operations, Goodyear had a net loss of US$174 million (96 cents
per share) in 2007's first quarter. All per share amounts are
diluted.
The 2008 quarter included after-tax financing fees related to
debt repayment of US$43 million (18 cents per share), US$13
million (5 cents per share) in after-tax rationalization
charges, an after-tax gain on asset sales of US$33 million (13
cents per share) and an after-tax gain on an excise tax
settlement in Latin America of US$8 million (3 cents per share).
The 2007 quarter was impacted by after-tax charges of US$64
million (35 cents per share) due to salaried benefit plan
changes, an estimated US$34 million (19 cents per share) related
to the 2006 United Steelworkers strike and US$31 million (17
cents per share) in rationalization and accelerated depreciation
charges.
Business Segments
All three of the company's businesses outside of North America
achieved record sales for any quarter during the 2008 first
quarter as the emerging markets businesses continued to grow.
Segment operating income increased in all four businesses.
Segment operating income for the Latin America and Asia Pacific
businesses were records for any quarter. Segment operating
income for the Europe, Middle East and Africa business was a
first quarter record.
North American Segment
North American Tire's first quarter sales decreased 1% from last
year. The 2007 quarter included approximately US$150 million in
sales from T&WA, which was divested in December 2007. Sales in
the 2008 quarter were impacted by reduced original equipment
volume resulting from lower vehicle production and a decline in
the consumer replacement tire market, particularly for low-
value-added tires. Sales benefited from strong pricing and
product mix as well as market share gains for Goodyear and
Dunlop brand tires in the consumer replacement market.
Segment operating income increased US$52 million primarily due
to improved pricing and product mix of US$67 million, which more
than offset increased raw material costs of US$5 million. Lower
selling, administrative and general expenses and structural cost
savings, including savings from the 2006 contract with the USW,
were partially offset by lower volume and transitional
manufacturing costs.
The company estimates the USW strike reduced 2007 first quarter
sales by US$102 million and segment operating income by US$34
million.
EMEA Segment
Europe, Middle East and Africa Tire's first quarter sales were a
record for any quarter and increased 16% over last year due to
favorable currency translation, improved pricing and product mix
and market share gains in the consumer replacement and
commercial replacement markets.
Segment operating income was a first quarter record and up 24%
due to improved pricing and product mix of US$40 million, which
more than offset increased raw material costs of US$4 million.
Favorable currency translation and lower selling, administrative
and general expenses offset higher manufacturing costs related
to ongoing labor issues in France and higher transportation
costs.
Latin America Segment
Latin American Tire's first quarter sales were a record for any
quarter and increased 29% over 2007 due to improved pricing and
product mix and favorable currency translation.
Segment operating income was a record for any quarter,
increasing 46% compared to the prior year. Improved pricing and
product mix of US$37 million, a US$12 million gain from the
settlement of an excise tax case and favorable currency
translation more than offset higher manufacturing costs and
selling, administrative and general expenses.
Asia Pacific Segment
Asia Pacific Tire's first quarter sales were a record for any
quarter and up 21% over last year due to favorable currency
translation, higher volume and improved pricing and product mix.
Segment operating income increased 69% and was a record for any
quarter. The improvement was due to improved pricing and
product mix of US$13 million, which more than offset US$4
million in increased raw material costs, as well as higher
volume, favorable currency translation and lower selling,
administrative and general expenses.
About Goodyear Tire
Headquartered in Akron, Ohio, The Goodyear Tire & Rubber Company
(NYSE: GT) -- http://www.goodyear.com/-- is the world's largest
tire company. The company manufactures tires, engineered rubber
products and chemicals in more than 60 facilities in 26
countries and employs 80,000 people worldwide. Goodyear has
subsidiaries in New Zealand, Venezuela, Peru, Mexico,
Luxembourg, Finland, Korea and Japan, among others.
* * *
As reported by the Troubled Company Reporter-Latin America on
March 7, 2008, Fitch Ratings upgraded The Goodyear Tire & Rubber
Company's Issuer Default Rating to 'BB-' from 'B+' and senior
unsecured debt rating to 'B+' from 'B-/RR6'.
PETROLEOS DE VENEZUELA: Not Transparent, Report States
------------------------------------------------------
Transparency International disclosed in its report on Promoting
Revenue Transparency that among oil and gas Latin American
companies, Petroleos de Venezuela SA was not transparent in
releasing its information on their revenues, El Universal
reports.
Juanita Olaya, the author of the report, said "The message from
Latin America is a positive one. Its companies lead
transparency," but with exception of PDVSA, the report says.
El Universal relates that that the governments in the region do
not restrict the information that companies might release,
according to Mr. Olaya
The report stated that 42 companies from different countries
were divided into three categories: high, middle and low,
depending particularly in terms of the payments made to the
state for right of use. PDVSA was in the "Low" category.
Mr. Olaya believed that the company has still a long run to
improve the information published on payment of rights.
Petroleos de Venezuela SA -- http://www.pdv.com/-- is
Venezuela's state oil company in charge of the development of
the petroleum, petrochemical and coal industry, as well as
planning, coordinating, supervising and controlling the
operational activities of its divisions, both in Venezuela and
abroad. The company has a commercial office in China.
PDVSA is one of the top exporters of oil to the US with proven
reserves of 77.2 billion barrels of oil -- the most outside the
Middle East -- and about 150 trillion cu. ft. of natural gas.
PDVSA's exploration and production take place in Venezuela, but
the company also has refining and marketing operations in the
Caribbean, Europe, and the US.
* * *
As reported in the Troubled Company Reporter-Latin America on
April 25, 2008, Standard & Poor's Ratings Services affirmed its
'BB-' long-term corporate credit rating on Petroleos de
Venezuela S.A. S&P said the outlook is stable.
***********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter - Latin America is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Fairless
Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick,
Maryland USA. Tara Eliza E. Tecarro, Sheryl Joy P. Olano,
Rizande de los Santos, and Pamella Ritah K. Jala, Editors.
Copyright 2008. All rights reserved. ISSN 1529-2746.
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