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 Thursday, May 1, 2008, Vol. 9, No. 86 Headlines A R G E N T I N A ALITALIA SPA: Silvio Berlusconi Mulls Firm's Nationalization BANCO MACRO: Okays ARS171 Million Cash Dividend Payment BASILEA SRL: Proofs of Claim Verification Deadline Is June 27 CONES ARGENTINA: Proofs of Claim Verification Is Until June 6 DYNAMOTIVE ENERGY: Posts US$14.2 Million Net Loss in FY 2007 FLASH PRINT: Proofs of Claim Verification Deadline Is June 30 GMAC LLC: Financial Arm Posts US$589MM Net Loss in 2008 1st Qtr. HEXCEL CORP: S&P Maintains 'B3' Corp. Rating With Stable Outlook INSTITUTO DE ENSENANZA: Claims Verification Deadline Is June 24 INVERSIONES Y REPRESENTACIONES: Buys Office Building for US$70MM NRG ENERGY: Moody's Changes Outlook to Stable; Holds 'Ba3' Rtgs. PETROBRAS ENERGIA: Lorenzo Plant to Face Maintenance Shutdowns PLAY WOMEN: Proofs of Claim Verification Is Until July 17 PREVENCION Y SEGURIDAD: Individual Reports Filing Is on Aug. 14 QUEBECOR WORLD: Posts US$2 Billion Net Loss for Full Year 2007 QUEBECOR WORLD: Quebecor Inc Issues Clarification QUEBECOR WORLD: Randy Benson Named Chief Restructuring Officer ROSAC SA: Trustee to Verify Proofs of Claim Until July 8 SERVI CAC: Buenos Aires Court Concludes Reorganization SOUND BEACH: Proofs of Claim Verification Is Until June 23 STANDARD BANK ARGENTINA: Moody´s Shifts BFSR Outlook to Positive B E R M U D A CENTRAL EUROPEAN: US$14.9MM Net Income in 3-Mos. Ended March 31 MONTPELIER RE: Net Income Drops to US$300,000 in 1Q 2008 WARNER CHILCOTT: To Settle Class Action Suit for US$16.5 Million B R A Z I L ABITIBIBOWATER INC: Completes US$1.6BB Financing Transactions BANCO BRADESCO: Says Group Health Coverage to Boost Premiums BANCO ITAU: Inks Partnership Pact With Banco Nacional BANCO ITAU: Issues Webcast Alert for First Quarter 2008 Earnings BANCO NACIONAL: Inks Partnership Pact with Banco Itau BANCO NACIONAL: Lending Rises to BRL70.2B in 12 Mos. Ended March BANCO NACIONAL: Supports Jirau Power Plant, Madeira River BANCO NACIONAL: Ups Doc Collection Preservation Funds to BRL8MM BRASIL TELECOM: Moody's Continues Review After Telemar Merger BRASIL TELECOM: Tele Norte to Form New Telecom Through Firm CIA. SIDERURGICA: IRB Must Grant Reinsurance for Mapfre Policy COMPANHIA ENERGETICA: Eyes Controlling Stake in Two Firms COREL CORP: Reports US$18M Stockholders' Deficit, Lower Net Loss DELPHI CORP: Seeks DIP Facility Amendment Extension RHODIA SA: Invests EUR2MM on New Line of Eco-Friendly Solvents TELE NORTE: To Form Multinational Telecom Through Brasil Telecom C A Y M A N I S L A N D S ADELE SAILING: Proofs of Claim Filing Is Until May 5 ANN FUNDING: Proofs of Claim Filing Is Until May 4 ANN FUNDINJG: Proofs of Claim Filing Deadline Is May 4 BANK RAKYAT: To Hold Shareholders' General Meeting on May 15 BANK AUSTRIA: Proofs of Claim Filing Deadline Is May 5 BANK AUSTRIA: Sets Final Shareholders Meeting for May 6 COLUMBIA MARSICO: Proofs of Claim Filing Deadline Is May 6 COLUMBIA MARSICO GROWTH: Proofs of Claim Filing Is Until May 6 COLUMBIA SMALL: Proofs of Claim Filing Deadline Is May 6 CONSOLIDATED FINANCIAL: Proofs of Claim Filing Is Until May 3 FRESH DEL MONTE: Richard Contreras Replaces John Inserra as CFO POSEIDON INVESTMENTS: Proofs of Claim Filing Is Until May 4 C H I L E BANCO ITAU: Lines Up CLP20.0B 25-Year Subordinated Bond Issue FIDELITY NAT'L: Mulls Strategic Alternatives for Insurance Biz FIDELITY NATIONAL INFO: S&P Revises Outlook to Developing C O L O M B I A BANCOLOMBIA SA: Vice President Files Corporate Governance Survey ECOPETROL SA: Rises 7.7% on Oil After Gas Discovery ROO GROUP: Net Loss Up to US$12MM in Quarter Ended December 31 J A M A I C A CASH PLUS: Carlos Hill's Defense Seek Bail from Supreme Court NATIONAL WATER: Says Collection Drive Won't be Disrupted M E X I C O DURA AUTOMOTIVE: Files First Revised Chapter 11 Plan Supplements DURA AUTOMOTIVE: Unable to File 2007 Annual Report on Time EMPRESAS ICA: Sees 15%-20% Consolidated Revenue Growth in 2008 FRONTIER AIRLINES: Wants to Reject Republic Air Services Deal FRONTIER AIRLINES: Wants to Assume Airbus Sale LOI & Agency Deal FRONTIER AIRLINES: Wants to Hire Seabury as Financial Advisor MOVIE GALLERY: Delays SEC Filing of 2007 Annual Report MOVIE GALLERY: Gets 177 MG US & Hollywood Leases Rejected MOVIE GALLERY: Wants to Assume 3,060 Unexpired Property Leases RESIDENTIAL CAPITAL: Posts US$859MM Net Loss in 2008 First Qtr. P U E R T O R I C O HOME INTERIORS: Seeks Relief Under Chapter 11 in Dallas HOME INTERIORS: Case Summary & 61 Largest Unsecured Creditors PATHEON INC: Undertakes Series of Events on Restructuring Plan PATHEON INC: Moody's Holds B2 Rating; Changes Outlook to Neg. W HOLDING: Nasdaq to Suspend Trading, Delist Pref. Securities V E N E Z U E L A CITGO PETROLEUM: Net Income Drops to US$1.59 Billion in 2007 HARVEST NATURAL: Holds 1st Qtr. 2008 Earnings Conference Today PETROLEOS DE VENEZUELA: Complex & Plants Unaffected by Blackout - - - - - ================= A R G E N T I N A ================= ALITALIA SPA: Silvio Berlusconi Mulls Firm's Nationalization ------------------------------------------------------------ Italy's prime minister-elect Silvio Berlusconi threatened to nationalize Alitalia S.p.A. if the European Commission starts "harassing him" over the planned EUR300-million loan to the national carrier, various reports say. "If they continue whining, we could take a decision in which Alitalia could be bought by the state -- by state railway [Ferrovie dello Stato]," Mr. Berlusconi was quoted by Reuters as saying. "It's a threat, not a decision." Umberto Bossi, a Northern League party-mate, doubted the possibility of Ferrovie dello Stato buying Alitalia, since the state railway posted EUR409 million in losses in 2007, Agence France-Presse relates. Commission Reacts Commission spokesman Jonathan Todd noted that though Union executive is not concerned whether Italy nationalize Alitalia, since in the process itself there is a transfer of state resources to the company, AFP adds. Mr. Todd, Reuters reports, added that the Commission could intervene if Italy paid more than what Alitalia would have fetched in the open market. As reported in the TCR-Europe on April 28, 2008, the Commission gave the Italian government until May 4, 2008, to reply on concerns whether its planned EUR300-million loan to breaks the European Union rule on state aid. Italy needs to prove that the loan was offered on commercial terms to gain approval from the Commission. Alitalia may face months-long probe over the legality of the loan, which may further cramp Italy's efforts to sell its 49.9% stake in the national carrier. European Transport Commissioner Jacques Barrot, however, commented that it would be hard for the Italian government to prove that the loan is not public aid. The Commission said it would review the financing to Alitalia. Under EU's "one time, last time" principle, a company beneficiary of a state aid cannot receive additional rescue or restructuring funding within 10 years since its accepted financial assistance. Alitalia cannot receive further aid until 2011, since it took fiscal assistance in 2001. About Alitalia Headquartered in Rome, Italy, Alitalia S.p.A. -- http://www.alitalia.it/-- provides air travel services for passengers and air transport of cargo on national, international and inter-continental routes, including United States, Canada, Japan and Argentina. The Italian government owns 49.9% of Alitalia. Despite a EUR1.4 billion state-backed restructuring in 1997, Alitalia posted net losses of EUR256 million and EUR907 million in 2000 and 2001 respectively. Alitalia posted EUR93 million in net profits in 2002 after a EUR1.4 billion capital injection. The carrier booked annual net losses of EUR520 million in 2003, EUR813 million in 2004, EUR168 million in 2005, and EUR625.6 million in 2006. Italian Finance Minister Tommaso Padoa-Schioppa had said that if the sale to Air France fails, Alitalia may seek protection from creditors and the government would appoint a special commissioner to initiate bankruptcy proceedings. BANCO MACRO: Okays ARS171 Million Cash Dividend Payment ------------------------------------------------------- Business News Americas reports that Banco Macro SA's shareholders have authorized the distribution a ARS171 million cash dividend equivalent to 25% of its common equity. According to Banco Macro, about ARS141 million of the ARS171 million come from the 2007 earnings, with the remainder from profits booked in 2005. An analyst in Argentina told BNamericas that Banco Macro's decision is in line with its decision to put its excess capital to work. BNamericas relates that Banco Macro had ARS1.81 billion in excess capital as of Dec. 31, 2007, "equivalent to a 26.8% capitalization ratio." Banco Macro increased earnings by 15% to ARS169 million in the fourth quarter 2007, compared to the same period in 2006, on higher securities income following a recovery in government bond prices. Banco Macro's assets and equity totaled ARS19.9 billion and BRL2.8 billion respectively as of Dec. 31, 2007, BNamericas states. Headquartered in Buenos Aires, Argentina, Banco Macro (NYSE: BMA; Buenos Aires: BMA) -- http://www.macro.com.ar/-- had consolidated assets of ARS11.6 billion (US$3.7 billion) and consolidated deposits of ARS6 billion (US$2 million) as of June 2007. * * * As reported in the Troubled Company Reporter-Latin America on Dec. 26, 2007, Fitch Ratings affirmed Banco Macro SA's Foreign and local currency long-term Issuer Default Ratings at 'B+', Foreign and local currency short-term IDRs at 'B', and Individual at 'D'. Fitch said the rating outlook is stable. BASILEA SRL: Proofs of Claim Verification Deadline Is June 27 ------------------------------------------------------------- Pablo Arturo Melaragni, the court-appointed trustee for Basilea S.R.L.'s bankruptcy proceeding, will be verifying creditors' proofs of claim until June 27, 2008. Mr. Melaragni will present the validated claims in court as individual reports. 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 Basilea 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 Basilea's accounting and banking records will be submitted in court. Mr. Melaragni is also in charge of administering Basilea's assets under court supervision and will take part in their disposal to the extent established by law. The trustee can be reached at: Pablo Arturo Melaragni Viamonte 783 Buenos Aires, Argentina CONES ARGENTINA: Proofs of Claim Verification Is Until June 6 ------------------------------------------------------------- Ines Clos, the court-appointed trustee for Cones Argentina SRL's bankruptcy proceeding, will be verifying creditors' proofs of claim until June 6, 2008. Ms. Clos will present the validated claims in court as individual reports. The National Commercial Court of First Instance No. 19 in Buenos Aires, with the assistance of Clerk No. 37, 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 Cones Argentina 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 Cones Argentina's accounting and banking records will be submitted in court. La Nacion didn't states the submission dates of the reports. Ms. Clos is also in charge of administering Cones Argentina's assets under court supervision and will take part in their disposal to the extent established by law. The debtor can be reached at: Cones Argentina SRL Avenida San Juan 4377 Buenos Aires, Argentina The trustee can be reached at: Ines Clos Sarmiento 944 Buenos Aires, Argentina DYNAMOTIVE ENERGY: Posts US$14.2 Million Net Loss in FY 2007 ------------------------------------------------------------ Dynamotive Energy Systems Corporation incurred a net loss of US$14.2 million for year ended Dec. 31, 2007, compared to a net loss of US$14.3 million in 2006. For the three months ended Dec. 31, 2007, the company posted a US$4.3 million of net loss compared to a US$4.1 million of net loss for the same period in 2006. Net of non-cash compensation, the company had a net loss of US$3.3 million during the fourth quarter compared to US$3.1 million during the fourth quarter of 2006. As at Dec. 31, 2007, the company had cash and cash equivalents of US$1.8 million. This reflects the company’s cash balance at the beginning of 2007 of US$9.3 million plus equity issuance of US$23.1 million less capital expenditures of US$21.0 million and operating expenditures of US$9.6 million (which includes changes in working capital balances and miscellaneous non-cash charges). CEO Commentary Andrew Kingston, president and chief executive officer, said, “During the year Dynamotive completed construction of a state- of-the-art, modular 200-ton-per-day BioOil plant in Guelph, Ontario and also expanded and upgraded the West Lorne, Ontario plant, which is currently re-starting operations. Additionally, we strengthened Dynamotive’s management team and positioned ourselves to capitalize on world-wide market opportunities, most specifically in Canada, U.S., and Latin America. The company faced many challenges during 2007, as we worked to bring our biofuel facilities to operating status, as well as expand business operations in North and South America. We fully expect 2008 to be a year of achieving significant milestones.” About Dynamotive Energy Dynamotive Energy Systems Corporation (OTC BB: DYMTF.OB) -- http://www.dynamotive.com/-- is an energy solutions provider headquartered in Vancouver, Canada, with offices in the USA, UK and Argentina. Its carbon/greenhouse gas neutral fast pyrolysis technology uses medium temperatures and oxygen-less conditions to turn dry waste biomass and energy crops into BioOil(TM) for power and heat generation. BioOil(TM) can be further converted into vehicle fuels and chemicals. Going Concern Doubt BDO Dunwoody LLP, in Vancouver, Canada, conducted its audit of Dynamotive Energy Systems Corp.'s consolidated financial statements for the years ended Dec. 31, 2006, and 2005, in accordance with Canadian reporting standards, which do not permit a reference to conditions and events casting substantial doubt about the company's ability to continue as a going concern when these are adequately disclosed in the financial statements. Dynamotive Energy incurred a loss of US$14.3 million for the year ended Dec. 31, 2006. The company's ability to continue as a going concern is dependent on achieving profitable operations, commercializing its BioOil production technology and obtaining the necessary financing in order to develop this technology. FLASH PRINT: Proofs of Claim Verification Deadline Is June 30 ------------------------------------------------------------- Manuel Arnaldo, the court-appointed trustee for Flash Print Full Service SRL's bankruptcy proceeding, will be verifying creditors' proofs of claim until June 30, 2008. Mr. Arnaldo will present the validated claims in court as individual reports. The National Commercial Court of First Instance No. 18 in Buenos Aires, with the assistance of Clerk No. 35, 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 Flash Print 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 Flash Print's accounting and banking records will be submitted in court. La Nacion didn't states the submission dates of the reports. Mr. Arnaldo is also in charge of administering Flash Print's assets under court supervision and will take part in their disposal to the extent established by law. The debtor can be reached at: Flash Print Full Service SRL Esmeralda 1320 Buenos Aires, Argentina The trustee can be reached at: Manuel Arnaldo Parana 224 Buenos Aires, Argentina GMAC LLC: Financial Arm Posts US$589MM Net Loss in 2008 1st Qtr. ---------------------------------------------------------------- GMAC LLC's unit, GMAC Financial Services reported a 2008 first quarter net loss of US$589 million, compared to a net loss of US$305 million in the first quarter of 2007. Profitable results in the global automotive finance and insurance businesses were more than offset by significant declines in the international mortgage operation of Residential Capital, LLC. Affecting results in the quarter were market-driven valuation adjustments and lower net financing revenue. "Continued volatility in the capital and credit markets put pressure on first quarter results," GMAC Chief Executive Officer Alvaro de Molina said. "While the actions we have taken to date to reduce risk, reduce leverage and streamline the cost structure have produced results, there is still more to do to stabilize ResCap and position the overall company for profitable growth. Moving through this unprecedented market environment clearly requires endurance, and liquidity is the key enabler. GMAC has made prudent liquidity management a top priority including holding high levels of cash, expanding the use of GMAC Bank and working with our banking partners on an approach to renew bank facilities." Liquidity and Capital GMAC's consolidated cash and certain marketable securities were US$18.6 billion as of March 31, 2008, down from US$22.7 billion at Dec. 31, 2007. Of these total balances, ResCap's consolidated cash and cash equivalents were US$4.2 billion at quarter-end, down from US$4.4 billion at Dec. 31, 2007. The decline in cash is due mainly to open market debt repurchases, unsecured debt maturities and an increase in originations. During the fourth quarter of 2007 and first quarter of 2008, GMAC purchased ResCap debt for US$750 million in the open market, which was contributed to ResCap and retired during the first quarter. In exchange for the capital contribution, GMAC received shares of a new class of ResCap preferred equity that is equal to the market value of the debt at the time of the contribution. GMAC took this measure to further support the capital position at ResCap, while still maintaining consideration for GMAC's investors and stakeholders. As of March 31, 2008, ResCap's total equity base was US$5.8 billion, exceeding its minimum tangible net worth requirements in its credit facilities. Global Automotive Finance GMAC's global automotive finance business reported net income of US$258 million in the first quarter of 2008, compared to net income of US$398 million in the year-ago period. Strong vehicle origination and wholesale penetration were offset by weaker credit performance which drove unfavorable valuation adjustments, higher credit loss provisions and increased operating expenses related to restructuring, remarketing and servicing initiatives. In addition, affecting performance was lower gain on sale of receivables and deterioration in the residual performance of off-lease vehicles. New vehicle financing originations for the first quarter of 2008 increased to US$12.9 billion of retail and lease contracts from US$12.3 billion in the first quarter of 2007, despite lower industry sales levels in North America. Used vehicle originations for the quarter remained stable at US$2.1 billion, the same amount as the year-ago period. This reflects refinement of the diversification strategy to better balance credit risk. Delinquencies decreased in the first quarter of 2008 to 2.42% of managed retail assets, versus 2.52% in the prior year period. The decrease reflects additional underwriting and servicing measures taken in late 2007, which included expanding collection resources, increasing contact with higher-risk borrowers and strategically tightening underwriting. Credit losses have increased to 1.34% of managed assets, versus 1.13% in the first quarter of 2007. The actions taken have stemmed delinquencies in the first quarter, although losses increased as a result of higher year-end delinquency levels and loss severity in North America. In addition, international operations posted higher credit losses as a result of a maturing portfolio in Asia Pacific and weakness in Latin America; however, losses remain in line with expectations. Delinquency trends in the international operation improved in the first quarter. In February, GMAC disclosed a restructuring plan for its North American automotive finance operations that would consolidate 20 regional offices into five business centers in the U.S. and Canada and reduce the workforce by approximately 930 employees. GMAC expects to incur a total of US$65 to US$85 million in restructuring charges related to severance and other employee- related costs and the closure of facilities. During the first quarter, GMAC incurred US$11 million of restructuring charges and the majority of the remaining charges are expected to occur in the second half of the year. As a result of the restructuring, GMAC expects an annual run rate savings of approximately US$175 million. Insurance GMAC's insurance business recorded net income of US$132 million, compared to net income of US$143 million in the first quarter of 2007. Results primarily reflect investments related to growth initiatives in the U.S. The total value of the insurance investment portfolio was US$7.2 billion at March 31, 2008, compared to US$6.7 billion at March 31, 2007. The year-ago level reflects a dividend payment to GMAC. The majority of the investment portfolio is in fixed income securities with less than 10% invested in equity securities. On April 8, 2008, GMAC disclosed a plan related to the insurance business that aids in maintaining the current A - (excellent) financial strength rating issued by A.M. Best. The plan includes a dividend by GMAC of 100% of the voting interest in the insurance business to GMAC's shareholders, while GMAC continues to hold 100% of the economic interest in the business. This plan is expected to preserve the value of the insurance operations and enable growth initiatives to continue worldwide. Real Estate Finance ResCap reported a net loss of US$859 million for the first quarter of 2008, compared to a net loss of US$910 million in the year-ago period. The aggressive actions taken to reduce risk and rationalize the cost structure have favorably affected results in the U.S. residential finance business. These improvements, however, were offset by significant deterioration in international operations. Results in the quarter are attributable to market-driven valuation adjustments on mortgage loans held for sale, real estate assets and mortgage related investment securities. Partially offsetting these losses was a US$480 million gain recognized from the retirement of US$1.2 billion (face value) of debt. ResCap's U.S. residential finance business experienced improved results in the first quarter 2008, compared to the prior year. Prime conforming loan production increased to US$15.4 billion in the first quarter of 2008, versus US$9.6 billion in the year-ago period, the servicing portfolio posted strong results and operating expense targets were achieved. Deterioration in the mortgage market continues, however, driving increased charge- offs, lower valuations and higher cost of funds. The international mortgage business experienced a significant decline in the first quarter 2008 related to illiquidity in the global capital markets and weakening consumer credit in certain markets. This environment drove significant realized and unrealized losses in mortgage loans held for sale and investment securities. As a result, ResCap has reduced the size of its balance sheet and limited production of mortgages in overseas markets to only those products with market liquidity. The business lending operation also experienced continued pressure in the first quarter related to the decline in home sales and residential real estate values. Earlier this month, ResCap disclosed additional restructuring efforts in its international business aimed to further reduce the cost structure and change the business model to reflect current market conditions. In the U.K., approximately 280 positions will be eliminated and mortgage origination activity will be reduced. In Continental Europe, ResCap has suspended all new mortgage originations and refocused the business on asset management activities. As expected, ResCap has significant near-term liquidity requirements, which include approximately US$4 billion in unsecured and US$13 billion in secured debt maturities through the remainder of 2008. To meet these requirements, management is actively pursuing various alternatives including: potential secured funding to be provided by GMAC, ongoing and potential utilization of available committed lines of credit, the liquidation of certain assets, the extension of maturities and the refinancing or modification of our existing indebtedness. These efforts are ongoing and have not yet been completed. About GMAC LLC GMAC LLC -- http://www.gmacfs.com/-- formerly General Motors Acceptance Corporation, is a global, diversified financial services company that operates in approximately 40 countries in automotive finance, real estate finance, insurance and other commercial businesses. GMAC was established in 1919 and employs approximately 26,700 people worldwide. Cerberus Capital Management LP bought 51% GMAC LLC stake from General Motors Corp. on December 2006. Its Latin American operations are located in Argentina, Brazil, Chile, Colombia, Mexico and Venezuela. * * * As reported in the Troubled Company Reporter-Latin America on April 25, 2008, Moody's Investors Service downgraded GMAC LLC's senior rating to B2 from B1; the rating remains on review for further possible downgrade. This action follows Moody's rating downgrade of ResCap LLC, GMAC's wholly-owned residential mortgage unit, to Caa1 from B2. HEXCEL CORP: S&P Maintains 'B3' Corp. Rating With Stable Outlook ---------------------------------------------------------------- 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, Connecticut, 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. INSTITUTO DE ENSENANZA: Claims Verification Deadline Is June 24 --------------------------------------------------------------- Covini - Kovalsky & Asociados, the court-appointed trustee for Instituto de Ensenanza Privada Pedro Goyena S.A.'s bankruptcy proceeding, will be verifying creditors' proofs of claim until June 24, 2008. Covini - Kovalsky will present the validated claims in court as individual reports. 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 Instituto de Ensenanza 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 Instituto de Ensenanza's accounting and banking records will be submitted in court. Covini - Kovalsky is also in charge of administering Instituto de Ensenanza's assets under court supervision and will take part in their disposal to the extent established by law. The trustee can be reached at: Covini - Kovalsky & Asociados Tucuman 881 Buenos Aires, Argentina INVERSIONES Y REPRESENTACIONES: Buys Office Building for US$70MM ---------------------------------------------------------------- Inversiones y Representaciones S.A. has acquired and taken possession of 100% of the office building known as Edificio Republica upon the exercise of the option it already had. The final price paid for the building was US$70.3 million. This property, which was designed by renowned architect Cesar Pelli -- involved in the design of the World Financial Center in NYC and the Petronas Towers in Kuala Lumpur -- constitutes a unique premium office building in downtown Buenos Aires and brings about 19,890 gross leasable square meters to the company's portfolio. Within that total leasable area, the company expects to close lease agreements for about 16,000 sqm in the short term. Created in 1943, Inversiones y Representaciones S.A. aka IRSA (NYSE: IRS) (BCBA: IRSA) is a leading company with activities in the business of offices, commercial centers and hotels. It is the only company in the industry whose shares are listed on the Bolsa de Comercio de Buenos Aires and The New York Stock Exchange. Through its subsidiaries, IRSA manages an expanding top portfolio of shopping centers and office buildings, primarily in Buenos Aires. The company also develops residential subdivisions and apartments (specializing in high- rises and loft-style conversions) and owns three luxury hotels. Additionally, IRSA owns a 11.8% stake in Banco Hipotecario, Argentina's largest mortgage supplier in the country which shareholder's equity amounted to ARS2,247.6 million. * * * As reported in the Troubled Company Reporter-Latin America on Feb. 5, 2008, Fitch Ratings upgraded Inversiones y Representaciones S.A.'s ratings including its Foreign currency Issuer Default Rating to 'B+' from 'B', Local currency IDR to 'B+' from 'B', US$150 million notes due in 2017 to 'B+/RR4' from 'B'. Fitch said all ratings have stable outlooks. NRG ENERGY: Moody's Changes Outlook to Stable; Holds 'Ba3' Rtgs. ---------------------------------------------------------------- Moody's Investors Service changed the rating outlook for NRG Energy, Inc. to stable from negative, and upgraded its Speculative Grade Liquidity Rating to SGL-1 from SGL-2. The rating agency also affirmed all of NRG's ratings, including its Corporate Family Rating at Ba3, the Probability of Default Rating at Ba3, and the senior unsecured debt at B1. "The change in rating outlook reflects an expectation of continued stable cash flow for the foreseeable future, execution of a more balanced capital allocation program, and the continued use of joint ventures and other arrangements which mitigate risk and lower future capital expenditure requirements, "said A.J. Sabatelle, VP -- Senior Credit Officer of Moody's. "The upgrade in NRG's liquidity rating to SGL-1 factors in, among other things, the substantial reduction in working capital requirements following recent modifications to several of NRG's counterparty agreements," said Mr. Sabatelle. The rating affirmation reflects relatively stable cash flows expected at NRG given the company's competitive position in several key markets and the degree of forward hedges in place for the next several years. NRG's adjusted cash flow (CFO pre- W/C) to total adjusted debt has averaged approximately 15% for the past three years and 16% in 2007. Moody's expects this financial metric to modestly improve during 2008 due to continued steady operating cash flow generation and permanent consolidated debt reduction, including debt retirement of around US$475 million under the company's secured term loan, the bulk of which occurred in December 2007 and March 2008. The rating affirmation and outlook change considers management's efforts to balance shareholder and creditor interests through its deployment of discretionary cash. While Moody's believes that the company will continue to pursue a capital allocation strategy that returns to shareholders an average rate of 3% annually (or approximately US$250 million to US$300 million each year), the company has complimented this capital return program with associated debt retirement. Additionally, the rating action considers NRG's approach to managing a substantial capital investment program that include the use of joint venture arrangements for all of the company's largest generation projects, and the execution of long-term power purchase arrangements with load serving entities at other projects in conjunction with re-powering initiatives. Notwithstanding this measured approach, Moody's observes that potential capital investments for NRG over the next several years are quite substantial when compared to the company's US$10 billion market capitalization. For 2008, NRG will be able meet its capital expenditure requirements with operating cash flow as free cash flow (operating cash flow less dividends and capital expenditures) is expected to approximate $250 million (or about 3% of total consolidated debt), which incorporates a more than US$700 million year-over-year increase in capital investment, principally for re-powering and environmental related requirements. The upgrade of NRG's speculative grade liquidity rating to SGL-1 from SGL-2 reflects Moody's expectation that NRG will maintain a very good liquidity profile over the next 12-month period as a result of its generation of strong internal cash flows, maintenance of significant cash balances and access to substantial credit availability. The upgrade considers the recent increase in credit availability following NRG's successful exchange of collateral with its largest counterparties, enabling the return of US$622 million in letters of credit, and acknowledges the expected further increase in liquidity that should follow upon completion of the sale of ITISA to a subsidiary of Brookfield Asset Management for $288 million, subject to purchase price adjustments. NRG's stable rating outlook reflects Moody's expectation for continued generation of relatively predictable cash flow for this wholesale power company due to the fleet's competitive position and hedging strategy. The stable outlook considers continued execution of management's capital allocation policy, which has resulted in lower consolidated debt, and factors in NRG's measured strategy for capital investment, including the use of joint ventures and execution of key contractual arrangements to mitigate risk. In light of better macroeconomic conditions for power generators, including lower reserve margins in certain regions and a long-lead time for large base load construction, Moody's expects improved financial performance in the intermediate term for most wholesale power companies, including NRG. The ratings for NRG could be upgraded if such conditions lead to an improvement in key financial metrics including adjusted cash flow (CFO pre-W/C) to total adjusted debt rising to the high teens level on a sustainable basis, while maintaining its discipline in executing its capital allocation program. An additional consideration concerning any upgrade would be a deeper understanding around the numerous growth initiatives at the company, including the recent formation of Nuclear Innovation North America, a joint venture with Toshiba Corp. The rating could be downgraded if the degree of shareholder initiatives accelerates over the next twelve to eighteen months or if the company chooses to finance its capital investment program or any acquisition with higher than anticipated levels of debt. Additionally, should margins compress across NRG's generation fleet due to weaker macroeconomic factors or an extended forced outage causing adjusted cash flow (CFO pre-W/C) to total adjusted debt to fall below 12% for an extended period, the rating could be downgraded. Upgrades: Issuer: NRG Energy, Inc. -- Speculative Grade Liquidity Rating, Upgraded to SGL-1 from SGL-2 -- Multiple Seniority Shelf, Upgraded to a range of 73 – LGD5 to 17 - LGD2 from a range of 78 - LGD5 to 22 - LGD2 -- Senior Secured Bank Credit Facility, Upgraded to 17 - LGD2 from 22 - LGD2 -- Senior Unsecured Regular Bond/Debenture, Upgraded to 73 - LGD5 from 78 - LGD5 Outlook Actions: Issuer: NRG Energy, Inc. -- Outlook, Changed To Stable From Negative Issuer: NRG Holdings, Inc. -- Outlook, Changed To Rating Withdrawn From No Outlook Withdrawals: Issuer: NRG Holdings, Inc. -- Senior Secured Bank Credit Facility, Withdrawn, previously rated (P)B2 Hearquartered in Princeton, New Jersey, NRG Energy Inc. (NYSE: NRG) -- http://www.nrgenergy.com/-- owns and operates a diverse portfolio of power-generating facilities, primarily in Texas and the Northeast, South Central and West regions of the U.S. Its operations include baseload, intermediate, peaking, and cogeneration and thermal energy production facilities. NRG also has ownership interests in generating facilities in Australia, Germany and Brazil. PETROBRAS ENERGIA: Lorenzo Plant to Face Maintenance Shutdowns -------------------------------------------------------------- The San Lorenzo refinery, owned by Petrobras Energia S.A. (NYSE:PZE), is under a series of maintenance shutdowns by the end of the second quarter of 2008 as researched by Industrial Info Resources. The refinery has six units with a combined processing capacity of 50,000 barrels per day. Petrobras Energia, S.A. is headquartered in Buenos Aires, Argentina. Its majority owner, Petrobras, is based in Rio de Janeiro, Brazil. * * * As reported on Oct. 29, 2007, Moody's Investors Service assigned a Ba1 global local currency issuer rating to Petrobras Energia S.A., and affirmed its Ba2 foreign currency rating for bonds issued under the US$2.5 billion Obligaciones Negociables program, and the Baa1 FCBR for the Series S bonds based on a Petrobras standby purchase agreement. In May 2007, Fitch ratings assigned BB long-term issuer default rating on Petrobras Energia S.A. Fitch said the outlook is stable. PLAY WOMEN: Proofs of Claim Verification Is Until July 17 --------------------------------------------------------- Pablo Javier Kainsky, the court-appointed trustee for Play Women S.R.L.'s bankruptcy proceeding, will be verifying creditors' proofs of claim until July 17, 2008. Mr. Kainsky will present the validated claims in court as individual reports on Sept. 15, 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 Play Women 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 Play Women's accounting and banking records will be submitted in court on Oct. 27, 2008. Mr. Kainsky is also in charge of administering Play Women's assets under court supervision and will take part in their disposal to the extent established by law. The trustee can be reached at: Pablo Javier Kainsky Reconquista 715 Buenos Aires, Argentina PREVENCION Y SEGURIDAD: Individual Reports Filing Is on Aug. 14 --------------------------------------------------------------- Moises Gorelik, the court-appointed trustee for Prevencion y Seguridad Total SRL's reorganization proceeding, will present the validated claims as individual reports in the National Commercial Court of First Instance in Buenos Aires on Aug. 14, 2008. Mr. Gorelik will be verifying creditors' proofs of claim until June 16, 2008. He will submit to court a general report containing an audit of Prevencion y Seguridad's accounting and banking records on Sept. 26, 2008. Creditors will vote to ratify the completed settlement plan during the assembly on April 1, 2009. The debtor can be reached at: Prevencion y Seguridad Total SRL Paraguay 754 Buenos Aires, Argentina The trustee can be reached at: Moises Gorelik Lavalle 1675 Buenos Aires, Argentina QUEBECOR WORLD: Posts US$2 Billion Net Loss for Full Year 2007 -------------------------------------------------------------- Quebecor World Inc. reported that for full year 2007, it generated revenues of US$5.7 billion compared to US$6.1 billion in 2006 and a net loss of US$2.2 billion or compared to a net income of US$28.3 million the previous year. Full-year results included a goodwill impairment charges, and impairment of assets, restructuring and other charges net of income taxes of US$2.1 billion or (US$16.26) per share, compared to US$87.3 million or (US$0.67) per share in 2006. The cash component of this charge was US$42.7 million in 2007 compared to US$76.4 million in 2006. Excluding these charges, the adjusted net loss was US$54.9 million or (US$0.58) per share in 2007 compared to adjusted net income of US$117.9 million or diluted earnings per share of US$0.64 for the same period in 2006. Operating income before IAROC and goodwill impairment charge in 2007 was US$90.1 million compared to US$241.5 million in 2006. On the same basis, EBITDA was US$461.9 million in 2007 compared to US$579.9 million in 2006. The reduction of EBITDA in 2007 is principally explained by US$80 million in largely non-cash, additional specific charges, compared to the prior year. Quebecor World's full-year 2007 revenues reflect a reduction in volume in its North American operations, in particular as the result of several plant closures as the company moved to complete its three-year restructuring and retooling program. In addition to goodwill, IAROC and specific charges, the decrease in profitability reflects volume reduction, pricing pressure, underperforming European assets and higher financial expenses not fully compensated by cost reductions and efficiency gains. On Jan. 21, 2008, Quebecor World filed for creditor protection in the United States and Canada due to the inability of the Company to raise new capital in the current market environment and to complete the sale of its European operations. The filing was necessary to ensure the long-term viability of the Company within a process that ensures fair and equitable treatment for all stakeholders. "We have made important and substantial efforts to stabilize our business and to reach out to all our stakeholders in this process," said Jacques Mallette, President and CEO, Quebecor World. "I am pleased with what we have accomplished so far, and it demonstrates the support of our customers, our suppliers and our employees to our business going forward. We continue to renew and earn new business with important customers across our global platform including, most recently, McGraw Hill, Wenner Media and RONA." Bankruptcy Update Since the initial filing, the company received the final order for its US$1 billion DIP (debtor-in-possession) financing from the US court. As stated in the Monitor's report of April 1, 2008, the company had unrestricted cash balances of US$160 million and access to revolving credit facility of up to US$400 million. The company believes that this financing and its ability to generate significant cash flow from operations will allow it to emerge from creditor protection as a strong company in its industry. The company continues to serve all its global customers with superior products and enhanced value-added services as illustrated by the recent launch of its integrated multi-channel solutions offering designed to increase the efficiency of its customers advertising campaigns. To assist in its efforts to emerge from creditor protection as quickly as possible, the Company has appointed Mr. Randy Benson, Chief Restructuring Officer of the company. Mr. Benson has extensive experience in working with other companies going through a financial restructuring process. He reports to the Restructuring Committee of the Board of Directors. "The restructuring process is proceeding as planned. To date we have passed several important milestones and we are actively developing our five-year business plan which we expect to be completed in the second quarter. The appropriate creditors and ad hoc committees have been established in the U.S. and Canada and we are pursuing an active and ongoing dialogue," added Mr. Mallette. "To date we have had more than 60 uncontested motions approved in the U.S. process which is a strong indication of everyone's focus and determination to make this process a success by exiting creditor protection as soon as possible." Fourth Quarter Results For the fourth quarter of 2007, the company generated revenues of US$1.5 billion compared to US$1.6 billion in 2006, and a net loss of US$1.8 billion or (US$13.87) per share compared to net income from continuing operations of US$11.6 million or US$0.03 per share in the same period last year. Fourth quarter results included impairment of assets, restructuring and other charges (IAROC) and a goodwill impairment charge, net of income taxes, of US$1.8 billion or (US$13.81) per share compared to US$33.0 million or (US$0.25) per share in 2006. The cash component of this charge was US$5.1 million in 2007 compared to US$21.1 million in 2006. Excluding these charges, the adjusted net loss was US$1.9 million or (US$0.06) per share for the fourth quarter of 2007 compared to adjusted net income of US$44.6 million or diluted earnings per share of US$0.28 for the same period in 2006. Operating income before IAROC and goodwill impairment for the fourth quarter of 2007 was US$1.8 million compared to US$74.2 million for the same period in 2006. On the same basis, EBITDA was US$130.3 million for the fourth quarter of 2007 compared to US$170.2 million for the same period in 2006. In the fourth quarter 2007, the Company incurred US$45 million in additional specific charges compared to the fourth quarter of 2006. These charges were largely non- cash. Excluding these additional charges, EBITDA in the fourth quarter 2007 was slightly higher than during the same period in 2006. About Quebecor World Quebecor World Inc. (TSX: IQW) -- http://www.quebecorworld.com/ -- provides high-value, complete marketing and advertising solutions to leading retailers, catalogers, branded-goods companies and other businesses with marketing and advertising activities, as well as complete, full-service print solutions for publishers. The company is a market leader in most of its major product categories, which include advertising inserts and circulars, catalogs, direct mail products, magazines, books, directories, digital premedia, logistics, mail list technologies and other value-added services. Quebecor World has approximately 28,000 employees working in more than 115 printing and related facilities in the United States, Canada, Argentina, Austria, Belgium, Brazil, Chile, Colombia, Finland, France, India, Mexico, Peru, Spain, Sweden, and Switzerland. Quebecor World and 53 of its subsidiaries, including those in Canada, filed a petition under the Companies' Creditors Arrangement Act before the Superior Court of Quebec, Commercial Division, in Montreal, Canada, on Jan. 20, 2008. The Honorable Justice Robert Mongeon oversees the CCAA case. Francois-David Pare, Esq., at Ogilvy Renault, LLP, represents the Company in the CCAA case. Ernst & Young Inc. was appointed as Monitor. On Jan. 21, 2008, Quebecor World (USA) Inc., along with other U.S. affiliates, filed for chapter 11 bankruptcy on Jan. 21, 2008 (Bankr. S.D.N.Y Lead Case No. 08-10152). Anthony D. Boccanfuso, Esq., at Arnold & Porter LLP represents the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors is represented by Akin Gump Strauss Hauer & Feld LLP. Based in Corby, Northamptonshire, Quebecor World PLC -- http://www.quebecorworldplc.com/-- is the U.K. subsidiary of Quebecor World Inc. that specializes in web offset magazines, catalogues and specialty print products for marketing and advertising campaigns. The company employs around 290 people. Quebecor PLC was placed into administration with Ian Best and David Duggins of Ernst & Young LLP appointed as joint administrators effective Jan. 28, 2008. As of Sept. 30, 2007, Quebecor World's unaudited consolidated balance sheet showed total assets of US$5,554,900,000, total liabilities of US$3,964,800,000, preferred shares of US$175,900,000, and total shareholders' equity of US$1,414,200,000. The company has until May 20, 2008, to file a plan of reorganization in the Chapter 11 case. The Debtors' CCAA stay has been extended to May 12, 2008. QUEBECOR WORLD: Quebecor Inc Issues Clarification ------------------------------------------------- Following the release of the financial results of Quebecor World Inc. for the 2007 financial year, Quebecor Inc. specifies that Quebecor World is a legal entity distinct from Quebecor and Quebecor World's announced net losses have no impact on Quebecor's liquidity. On Jan. 21, 2008, Quebecor World Inc. placed itself under the protection of the Companies' Creditors Arrangement Act in Canada and Chapter 11 of the Bankruptcy Code in the United States. As a result, Quebecor Inc. does not expect to realize any future earnings on its investment in Quebecor World. Quebecor Inc. has not secured Quebecor World's commitments, including its debt and advances under its securitization programs. In accordance with generally accepted accounting principles, Quebecor Inc. ceased consolidating the result of Quebecor World as of Jan. 21, 2008. Quebecor Inc. plans to release its financial results for the 2007 financial year and the results of its Quebecor Media subsidiary for the first quarter of 2008 during the week of May 5, 2008. About Quebecor Inc. Quebecor Inc. (TSX:QBR.A)(TSX:QBR.B) is a holding company with interests in two companies, Quebecor Media Inc. and Quebecor World Inc. Quebecor holds a 54.7% interest in Quebecor Media, which owns operating companies in numerous media-related businesses: Videotron Ltd., the largest cable operator in Quebec and a major Internet Service Provider and provider of telephone and business telecommunications services; Sun Media Corporation, the largest publisher of newspapers in Canada; Quebecor MediaPages, a publisher of print and online directories; TVA Group Inc., operator of the largest French-language over-the-air television network in Quebec, a number of specialty channels, and the English-language over-the-air station Sun TV; Canoe Inc., operator of a network of English- and French-language Internet properties in Canada; Nurun Inc., a major interactive technologies and communications agency with offices in Canada, the United States, Europe and Asia; magazine publisher TVA Publishing Inc.; book publisher and distributor Quebecor Media Book Group Inc.; Archambault Group Inc. and TVA Films, companies engaged in the production, distribution and retailing of cultural products, and Le SuperClub Videotron ltee, a DVD and console game rental and retail chain. About Quebecor World Quebecor World Inc. (TSX: IQW) -- http://www.quebecorworld.com/ -- provides high-value, complete marketing and advertising solutions to leading retailers, catalogers, branded-goods companies and other businesses with marketing and advertising activities, as well as complete, full-service print solutions for publishers. The company is a market leader in most of its major product categories, which include advertising inserts and circulars, catalogs, direct mail products, magazines, books, directories, digital premedia, logistics, mail list technologies and other value-added services. Quebecor World has approximately 28,000 employees working in more than 115 printing and related facilities in the United States, Canada, Argentina, Austria, Belgium, Brazil, Chile, Colombia, Finland, France, India, Mexico, Peru, Spain, Sweden, and Switzerland. Quebecor World and 53 of its subsidiaries, including those in Canada, filed a petition under the Companies' Creditors Arrangement Act before the Superior Court of Quebec, Commercial Division, in Montreal, Canada, on Jan. 20, 2008. The Honorable Justice Robert Mongeon oversees the CCAA case. Francois-David Pare, Esq., at Ogilvy Renault, LLP, represents the Company in the CCAA case. Ernst & Young Inc. was appointed as Monitor. On Jan. 21, 2008, Quebecor World (USA) Inc., along with other U.S. affiliates, filed for chapter 11 bankruptcy on Jan. 21, 2008 (Bankr. S.D.N.Y Lead Case No. 08-10152). Anthony D. Boccanfuso, Esq., at Arnold & Porter LLP represents the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors is represented by Akin Gump Strauss Hauer & Feld LLP. Based in Corby, Northamptonshire, Quebecor World PLC -- http://www.quebecorworldplc.com/-- is the U.K. subsidiary of Quebecor World Inc. that specializes in web offset magazines, catalogues and specialty print products for marketing and advertising campaigns. The company employs around 290 people. Quebecor PLC was placed into administration with Ian Best and David Duggins of Ernst & Young LLP appointed as joint administrators effective Jan. 28, 2008. As of Sept. 30, 2007, Quebecor World's unaudited consolidated balance sheet showed total assets of US$5,554,900,000, total liabilities of US$3,964,800,000, preferred shares of US$175,900,000, and total shareholders' equity of US$1,414,200,000. The company has until May 20, 2008, to file a plan of reorganization in the Chapter 11 case. The Debtors' CCAA stay has been extended to May 12, 2008. QUEBECOR WORLD: Randy Benson Named Chief Restructuring Officer -------------------------------------------------------------- Quebecor World Inc. has appointed Randy Benson, Chief Restructuring Officer of the company. Mr. Benson will report to the Restructuring Committee of the Board of Directors. "We are very pleased to have someone of Randy's experience and capabilities joining Quebecor World at this time," said Jacques Mallette, President and CEO, Quebecor World. "Randy brings valuable experience in working with other companies going through a financial restructuring process. He will work closely with our senior management team and the Creditors' Committees, as we develop our restructuring plan with a view of quickly emerging from creditor protection as a strong company in our industry." Mr. Benson most recently served as Chief Restructuring Officer for Hollinger Inc and prior to that held the same position at Ivaco Inc. Mr. Benson was Senior Vice-President and Chief Financial Officer at Call-Net Enterprises-Sprint Canada Inc. and before that he served as a division president at Parmalat Canada and as Executive Vice-President and Chief Financial Officer of Beatrice Foods Inc. He is the principal of R.C. Benson Consulting Inc., a management consulting company focused on providing strategic analysis, chief executive management, and financial and operational restructuring expertise. About Quebecor World Quebecor World Inc. (TSX: IQW) -- http://www.quebecorworld.com/ -- provides high-value, complete marketing and advertising solutions to leading retailers, catalogers, branded-goods companies and other businesses with marketing and advertising activities, as well as complete, full-service print solutions for publishers. The company is a market leader in most of its major product categories, which include advertising inserts and circulars, catalogs, direct mail products, magazines, books, directories, digital premedia, logistics, mail list technologies and other value-added services. Quebecor World has approximately 28,000 employees working in more than 115 printing and related facilities in the United States, Canada, Argentina, Austria, Belgium, Brazil, Chile, Colombia, Finland, France, India, Mexico, Peru, Spain, Sweden, and Switzerland. Quebecor World and 53 of its subsidiaries, including those in Canada, filed a petition under the Companies' Creditors Arrangement Act before the Superior Court of Quebec, Commercial Division, in Montreal, Canada, on Jan. 20, 2008. The Honorable Justice Robert Mongeon oversees the CCAA case. Francois-David Pare, Esq., at Ogilvy Renault, LLP, represents the Company in the CCAA case. Ernst & Young Inc. was appointed as Monitor. On Jan. 21, 2008, Quebecor World (USA) Inc., along with other U.S. affiliates, filed for chapter 11 bankruptcy on Jan. 21, 2008 (Bankr. S.D.N.Y Lead Case No. 08-10152). Anthony D. Boccanfuso, Esq., at Arnold & Porter LLP represents the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors is represented by Akin Gump Strauss Hauer & Feld LLP. Based in Corby, Northamptonshire, Quebecor World PLC -- http://www.quebecorworldplc.com/-- is the U.K. subsidiary of Quebecor World Inc. that specializes in web offset magazines, catalogues and specialty print products for marketing and advertising campaigns. The company employs around 290 people. Quebecor PLC was placed into administration with Ian Best and David Duggins of Ernst & Young LLP appointed as joint administrators effective Jan. 28, 2008. As of Sept. 30, 2007, Quebecor World's unaudited consolidated balance sheet showed total assets of US$5,554,900,000, total liabilities of US$3,964,800,000, preferred shares of US$175,900,000, and total shareholders' equity of US$1,414,200,000. The company has until May 20, 2008, to file a plan of reorganization in the Chapter 11 case. The Debtors' CCAA stay has been extended to May 12, 2008. ROSAC SA: Trustee to Verify Proofs of Claim Until July 8 -------------------------------------------------------- Carlos Grela, the court-appointed trustee for Rosac SA's reorganization proceeding, will be verifying creditors' proofs of claim until July 8, 2008. Mr. Grela will present the validated claims in court as individual reports. The National Commercial Court of First Instance No. 11 in Buenos Aires, with the assistance of Clerk No. 21, 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 Rosac 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 Rosac's 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 April 21, 2009. The debtor can be reached at: Rosac SA Presidente Roque S. Pena 726 Buenos Aires, Argentina The trustee can be reached at: Carlos Grela Nunez 2395 Buenos Aires, Argentina SERVI CAC: Buenos Aires Court Concludes Reorganization ------------------------------------------------------ Servi Cac S.A. concluded its reorganization process, according to data released by Infobae on its Web site. The closure came after the National Commercial Court of First Instance in Buenos Aires, homologated the debt plan signed between the company and its creditors. SOUND BEACH: Proofs of Claim Verification Is Until June 23 ---------------------------------------------------------- Otto Reinaldo Munch, the court-appointed trustee for Sound Beach SA's bankruptcy proceeding, will be verifying creditors' proofs of claim until June 23, 2008. Mr. Munch 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 Sound Beach 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 Sound Beach's accounting and banking records will be submitted in court. La Nacion didn't states the submission dates of the reports. Mr. Munch is also in charge of administering Sound Beach's assets under court supervision and will take part in their disposal to the extent established by law. The debtor can be reached at: Sound Beach SA Establecida en Avenida Uriarte 1246 Buenos Aires, Argentina The trustee can be reached at: Otto Reinaldo Munch Maipu 509 Buenos Aires, Argentina STANDARD BANK ARGENTINA: Moody´s Shifts BFSR Outlook to Positive ---------------------------------------------------------------- Moody's Investors Service has changed the outlook on Standard Bank Argentina S.A's Bank Financial Strength Rating to positive from stable, while affirming the bank's deposit ratings. The new outlook is based on the bank´s performance for the nine months in 2007 following its acquisition of a substantial part of the assets and liabilities of BankBoston N.A. -- Bank of America's branch in Argentina -- in April 2007. Standard Bank has successfully consolidated its retail, corporate and investment banking operations and expanded its existing business as it aims to increase the scale of its Argentine franchise. The fact that the bank also managed to maintain its business and market share even as it changed its brand image also supports the revised outlook. Standard Bank is currently the eighth largest private bank in the system in terms of loans and deposits. The rating agency noted that the bank's profitability during its first nine months of activity, however, was severely affected by extraordinary costs related to the acquisition. Moody´s expects an improvement in Standard Bank's ability to generate core earnings in the short-term, as the balance sheet continues to grow in a healthy manner. Improved profitability and franchise value could positively affect the bank's ratings. As of December 2007, Standard Bank had ARS8.901 million in assets, ARS6.246 million in deposits and ARS698 million in equity. Its 88 branches achieve nation coverage. Currently the bank's shareholders are Standard Bank London Holding Plc (76.7%) and Holding W S de Inversiones S.A. (23.3%). The bank enjoys strong support from the Standard Bank Group, with processes and policies highly integrated with its parent bank. Rating affected: -- Bank Financial Strength Rating: D-, outlook changed to positive from stable These ratings were affirmed: -- Long Term Global Local Currency Deposits: Ba1/NP -- Long Term Global Foreign Currency Deposits: Caa1/NP, positive outlook -- National Scale Rating for Local Currency Deposits: Aaa.ar -- National Scale Rating for Foreign Currency Deposits: Ba1.ar, stable outlook Headquartered in Buenos Aires, Argentina, Standard Bank Argentina SA -- www.standardbank.com.ar -- is a subsidiary of Standard Bank Plc, which owns 77% of the Argentine unit, while the remaining 23% is in the hands of local partners. Standard Bank Argentina ranks 10th and sixth in terms of assets and deposits with market shares of 4% and 5% respectively. ============= B E R M U D A ============= CENTRAL EUROPEAN: US$14.9MM Net Income in 3-Mos. Ended March 31 --------------------------------------------------------------- Central European Media Enterprises Ltd. reported financial results for the three months ended March 31, 2008. Net revenues for the first quarter of 2008 increased 51% to US$223.5 million, compared to the first quarter of 2007. Operating income for the quarter increased US$31.4 million to US$44.7 million. Net income increased US$15.1 million, and fully diluted income per share increased by US$0.36 to US$0.35. Segment EBITDA for the first quarter of 2008 increased 86% to US$74.7 million, compared to the first quarter of 2007. Chief Executive Officer, Michael Garin said: "Following a spectacular 2007 performance, 2008 is off to a strong start and we are on route to achieve another record-setting year, with expected revenues of US$1.1 billion and broadcast Segment EBITDA of US$440 million. At a time when most media companies are struggling to deliver growth, CME is distinguishing itself from its peers by forecasting broadcast revenue growth of 30% and Segment EBITDA growth of 36%. We are aggressively developing our New Media businesses. They currently attract more than 1.2 million unique daily visitors. In a period of chaotic financial markets, the successful issuance of US$475 million in senior convertible notes has provided us with the financial resources to execute on our strategic growth initiatives and continue to drive value for shareholders." Chief Operating Officer, Adrian Sarbu added: "We are delivering terrific results in all our markets. Every one of CME's television stations exceeded our expectations in the first quarter. Our revenue growth initiatives combined with a focus on operating efficiencies continue to drive margin expansion. Once we complete the buyout of our partners in Studio 1+1, we will be in a strong position to capitalize on the rapid growth in our largest market, as everywhere else." Consolidated Results for the Three Months Ended March 31, 2008 Consolidated net revenues for the three months ended March 31, 2008, increased by 51% to US$223.5 million from US$147.9 million for the three months ended March 31, 2007. Operating income for the quarter was US$44.7 million compared to US$13.3 million for the three months ended March 31, 2007. Net income for the quarter was US$14.9 million compared to a loss of US$0.3 million for the three months ended March 31, 2007. Fully diluted income loss per share for the three months ended March 31, 2008 increased US$0.36 to US$0.35. Segment Results for the Three Months Ended March 31, 2008 For the three months ended March 31, 2008, total Segment Net Revenues increased 51% to US$223.5 million from US$147.9 million for the three months ended March 31, 2007. Total Segment EBITDA for the three months ended March 31, 2008, increased 86% to US$74.7 million from US$40.1 million in the three months ended March 31, 2007. Segment EBITDA margin for the three months ended March 31, 2008, was 33% compared to 27% in the three months ended March 31, 2007. About Central European Media Enterprises Ltd. Based in Bermuda, Central European Media Enterprises Ltd., is a TV broadcasting company with leading networks in six Central and Eastern European countries. Launched in 1994, the company and its partners now operate 16 channels in six countries, including TV Nova, Nova Cinema and Galaxie Sport in the Czech Republic; PRO TV, PRO Cinema, Pro International, Sport.ro, MTV and Acasa in Romania; Nova TV in Croatia, TV Markiza in the Slovak Republic; POP TV and Kanal A in Slovenia; and Studio 1+1, Kino and Citi in Ukraine. For the year ended Dec. 31, 2007, the company generated segment revenues of US$840 million and segment EBITDA of US$320 million. Central European Media is traded on the NASDAQ and the Prague Stock Exchange under the ticker symbol "CETV". * * * As reported in the Troubled Company Reporter-Latin America on April 25, 2008, Standard & Poor's Ratings Services assigned its 'BB' debt rating to the US$475 million senior secured convertible notes due 2013 issued by Bermuda-based emerging markets TV broadcaster, Central European Media Enterprises Ltd. in March 2008. The long-termcorporate credit rating was affirmed at 'BB'. The outlook is stable. At the same time, S&P raised the debt rating on both Central European Media's EUR245 million and EUR150 million floating-rate notes due, respectively, in 2012 and 2014 to 'BB' from the previous 'BB-'. MONTPELIER RE: Net Income Drops to US$300,000 in 1Q 2008 -------------------------------------------------------- Montpelier Re Holdings Ltd. reported net income of US$300,000 for the three months ended March 31, 2008, compared to net income of US$73.3 million for the same period in 2007. The comprehensive loss for the quarter ended March 31, 2008 was US$1.8 million. Operating income, which excludes foreign exchange and investment gains and losses, was US$28.2 million. The loss ratio for the quarter was 54.5 percent, which includes US$42.8 million of large individual risk losses, slightly above the US$30 - 40 million range pre-announced by the Company on February 19th due to subsequent claims notices, and US$14 million of losses due to European windstorm Emma. This was offset in part by net favorable prior year reserve development of US$21 million, mainly as a result of adjustments to the 2004, 2005 and 2007 catastrophe losses. The combined ratio was 89.7% compared to 65.6% in the first quarter of 2007. Anthony Taylor, Chairman and CEO, commented: "As we indicated in February, the first quarter of 2008 was marked by an unusual frequency and severity of individual risk losses. Current market estimates have increased from our initial February estimate of over $2 billion to as much as $6 billion. Turning to the quarter’s investment performance, despite the extreme volatility in financial markets which impacted a wide range of asset classes our overall portfolio has stood up well, incurring a slight loss of 0.2% on a total return basis. “On the capital management front, we continue our active approach, and repurchased 4,784,764 common shares during the quarter at an average price of $16.33 per share. Since the end of the quarter we have repurchased a further 1,038,080 common shares at an average price of $16.57 per share.” About Montpelier Re Holdings Ltd. Headquartered in Bermuda, Montpelier Re Holdings Ltd. -- www.montpelierre.bm -- through its operating subsidiary Montpelier Reinsurance Ltd., provides customized, innovative, and timely reinsurance and insurance solutions to the global market. The company has operations in the United States and Europe. * * * To date, Montpelier Re Holdings holds A.M. Best's "bb+" subordinated debt rating and "bb" preferred stock rating. WARNER CHILCOTT: To Settle Class Action Suit for US$16.5 Million ---------------------------------------------------------------- Warner Chilcott Limited has agreed to settle a securities class action lawsuit pending in the United States District Court for the Southern District of New York. The suit asserted claims under the Securities Act of 1933 on behalf of a class consisting of all those who were allegedly damaged as a result of acquiring the company's common stock in connection with its initial public offering in September 2006. The terms of the settlement, which are subject to negotiation of definitive documentation and must be approved by the court, include a cash payment of US$16.5 million, expected to be made in the second or third quarter of 2008. The majority of the settlement will be funded by insurance proceeds and it will not have a material financial impact on the company. The settlement will resolve all claims asserted against Warner Chilcott and the other defendants in this case. The settlement will not contain any admission of wrongdoing by the company or any of the other defendants. Although Warner Chilcott believes this suit is without merit, the company is pleased to put the uncertainty of the class action litigation behind it and believes that the decision to settle is in the best interest of its shareholders. Headquartered in Hamilton, Bermuda, Warner Chilcott Ltd. -- http://www.warnerchilcott.com/-- is the holding company for a host of pharmaceutical makers. Women's health care products, including hormone therapies (femhrt and Estrace Cream) and contraceptives (Estrostep, Loestrin, and OvCon), are the company's largest segment. Other products include dermatology treatments for acne (Doryx) and psoriasis (Dovonex and Taclonex). United States subsidiary Warner Chilcott Inc. makes prescription drugs for dermatology and women's health; other subsidiaries provide services in data management systems, pharmaceutical development, manufacturing, and chemical development. * * * As reported in the Troubled Company Reporter-Latin America on Jan. 8, 2008, Standard & Poor's Ratings Services revised its outlook on specialty drug manufacturer Warner Chilcott Corp., Warner Chilcott Limited's subsidiary, to positive from stable. The ratings, including B+ corporate credit rating, were affirmed. "The outlook revision on the company reflects its solid operational track record and improving financial profile over the past two years," said S&P's credit analyst Arthur Wong. =========== B R A Z I L =========== ABITIBIBOWATER INC: Completes US$1.6BB Financing Transactions ------------------------------------------------------------- AbitibiBowater Inc. has completed a series of financing transactions designed to address upcoming debt maturities and general liquidity needs, principally at its Abitibi-Consolidated Inc. subsidiary. The transactions include: -- a private placement, by Abitibi-Consolidated Company of Canada, a subsidiary of Abitibi, of US$413 million of 13.75% senior secured notes due 2011; -- a US$400 million 364-day senior secured term loan to ACCC; -- a private placement of US$350 million of 8% convertible notes, due 2013, issued by AbitibiBowater; and -- a private exchange offer whereby ACCC exchanged a combination of new senior unsecured notes and cash for an aggregate of approximately US$453 million of outstanding notes issued by Abitibi, ACCC and Abitibi-Consolidated Finance L.P., a subsidiary of Abitibi. In the private placement of senior secured notes, ACCC issued US$413 million principal amount of 13.75% notes due 2011. The notes are guaranteed by Abitibi and certain of its subsidiaries, and are secured by mortgages on certain pulp and paper mills owned by, and security interests in and pledges of certain other assets of, ACCC and the guarantors. ACCC entered into a Credit and Guaranty Agreement among ACCC, Abitibi, certain of Abitibi's subsidiaries and affiliates, and a syndicate of lenders. Goldman Sachs Credit Partners L.P. is serving as syndication agent, documentation agent, administrative agent and collateral agent under the Credit Agreement. The Credit Agreement provides for a US$400 million senior secured term loan with a term of 364 days and a coupon of LIBOR + 800 basis points, with a 3.5% LIBOR floor. ACCC is required to repay US$50 million of the Term Loan with certain proceeds from the previously announced sale of its Snowflake, Arizona newsprint mill well as a portion of the cash, if any, reserved but unused in connection with the exchange offer by ACCC. Simultaneously with these transactions, AbitibiBowater consummated the sale of US$350 million of 8% convertible notes due 2013 to Fairfax Financial Holdings Limited and certain of its designated subsidiaries. The convertible notes bear interest at a rate of 8% per annum or 10% per annum if AbitibiBowater elects to pay interest through the issuance of additional convertible notes as "pay in kind" and are fully and unconditionally guaranteed by Bowater Incorporated, a subsidiary of AbitibiBowater. The notes are convertible into shares of AbitibiBowater common stock at an initial conversion price of US$10 per share. The company also disclosed that, as a result of the consummation of the above transactions, the financing condition had been satisfied in connection with ACCC's private offer to exchange a combination of cash and new 15.5% unsecured notes, due 2010, issued by ACCC for three series of outstanding notes: (i) up to US$195,612,000 principal amount of 6.95% senior notes due April 1, 2008, issued by Abitibi; (ii) up to US$150 million principal amount of 5.25% senior notes due June 20, 2008, issued by ACCC; and (iii) up to US$150 million principal amount of 7.875% senior notes due Aug. 1, 2009, issued by ACF. The company has waived the minimum tender condition with respect to the exchange offer and, as of March 31, 2008, had received tenders for approximately 89% of the 6.95% notes, 92% of the 5.25% notes, and approximately 95% of the 7.875% notes. The exchange offers are being made upon the terms and conditions set forth in the Second Amended and Restated Offering Circular and Consent Solicitation Statement dated March 18, 2008, as supplemented, and the related Letter of Transmittal and Consent. The senior secured notes, the Term Loan, the convertible notes and the exchange offer form the basis of the company's refinancing plan. "Our efforts to complete the necessary refinancing were complex in light of the current turmoil in the credit markets," John W. Weaver, executive chairman, stated. "We took a comprehensive approach to the task, having developed a refinancing plan that went beyond our immediate maturities. We are pleased to have this project behind us and look forward with optimism to the future." "We have accomplished much during our first six months as AbitibiBowater," David J. Paterson, president and chief executive officer stated. "We continue to reach out to a range of stakeholders as we actively prepare for the second phase of our strategic review. We remain committed to taking concrete steps to return AbitibiBowater to profitability and position the Company to emerge as the great turnaround story of the industry." About AbitibiBowater Headquartered in Montreal, Canada, AbitibiBowater Inc. (NYSE:ABH) -- http://www.abitibibowater.com/-- was formed as a result of the combination of Abitibi-Consolidated Inc. and Bowater Incorporated. Pursuant to the transaction, Abitibi- Consolidated Inc. and Bowater Incorporated became subsidiaries of AbitibiBowater. The company produces a range of forest products marketed in more than 80 countries around the world. The company's customers include many publishers, commercial printers, retailers, consumer products companies and building supply outlets. AbitibiBowater is also a recycler of newspapers and magazines. The company owns or operates 32 pulp and paper mills and 35 wood products facilities in North America and offshore. The company manages its business in five segments: coated papers, specialty paperBs, newsprint, market pulp and lumber. Following the required divestiture agreed to with the U.S. Department of Justice, AbitibiBowater will own or operate 27 pulp and paper facilities and 35 wood products facilities located in the United States, Canada, the United Kingdom and South Korea. The company also has newsprint sales offices in Brazil and Singapore. The company's shares also trade at the Toronto Stock Exchange under the stock symbol ABH. * * * As reported in the Troubled Company Reporter-Latin America on April 16, 2008, Standard & Poor's Ratings Services assigned recovery ratings to the senior unsecured debt issues of AbitibiBowater Inc., Abitibi-Consolidated Inc., and Bowater Inc. At the same time, S&P lowered the issue-level rating on these debts to 'CCC+' from 'B-'. BANCO BRADESCO: Says Group Health Coverage to Boost Premiums ------------------------------------------------------------ Banco Bradesco SA's Chief Financial Officer Samuel Monteiro told Business News Americas that the bank's insurance unit is betting on group health coverage as part of a bid to increase premiums in the next three to four years in line with projected market growth. Mr. Monteiro commented to BNamericas, "Group health is a contract between a company and an insurer so the government cannot interfere with prices like it does with individual plans. No government in the world can provide health care for everyone so health insurers have to make up the difference. We're placing our bets on group health insurance." BNamericas relates that Banco Bradesco agreed to purchase private health plan provider Mediservice from insurance broker Marsh for BRL84.9 million in January 2008. The bank is still awaiting regulatory approval of the acquisition. Mr. Monteiro told BNamericas that Banco Bradesco will turn to incorporating Mediservice and concentrate on organic growth for the future. "Mediservice was a timely acquisition. We're not going to buy a hospital or work with private health care plans. Besides, [antitrust regulator] Cade isn't going to approve another acquisition," Mr. Monteiro added. 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 ITAU: Inks Partnership Pact With Banco Nacional ----------------------------------------------------- Banco Itau Holding Financeira SA has signed a partnership agreement with Banco Nacional de Desenvolvimento Economico e Social to fund energy efficiency projects. Business News Americas relates that Banco Nacional will implement its energy efficiency program Proesco with Banco Itau as the financial agent. Banco Nacional will share financial risk with Banco Itau, with Banco Nacional taking 80% and Banco Itau taking 20%. About Banco Nacional 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. About Banco Itau Banco Itau Holding Financeira SA -- http://www.itau.com.br/-- is a private bank in Brazil. The company has four principal operations: banking -- including retail banking through its wholly owned subsidiary, Banco Itau SA(Itau), corporate banking through its wholly owned subsidiary, Banco Itau BBA SA (Itau BBA) and consumer credit to non-account hold customers through Itaucred -- credit cards, asset management and insurance, private retirement plans and capitalization plans, a type of savings plan. Itau Holding provides a variety of credit and non-credit products and services directed towards individuals, small and middle market companies and large corporations. The bank has offices in Miami, New York, Hongkong, Lisbon, Luxembourg, Bahamas, the Cayman Islands, Chile and Uruguay. * * * As reported in the Troubled Company Reporter-Latin America on Feb. 12, 2007, Fitch changed the outlook of Banco Itau Holding Financiera S.A.'s 'BB+' foreign currency IDR rating to positive from stable. BANCO ITAU: Issues Webcast Alert for First Quarter 2008 Earnings ---------------------------------------------------------------- Banco Itau Holding Financeira S.A. reported this Webcast alert: What: Conference Call about the First Quarter 2008 Earnings Results, to be reported May 6, 2008 When: May 7, 2008 @ 9:00 a.m. EST Where: http://prnewswire.isat.com.br/Index.asp?palestra_id=293 How: Simply log on to the web site above. Conference Call Numbers: Unitd States: (1 800) 860-2442 (toll-free); Brazil: (11) 4688-6301; Other countries: (1 412) 858-4600 Contact: Daniela Ueda Financial Investor Relations Banco Itau Holding Financeira S.A., Tel. Number: +55 11 3897-6857 e-mail add: daniela.ueda@firb.com Banco Itau Holding Financeira SA -- http://www.itau.com.br/-- is a private bank in Brazil. The company has four principal operations: banking -- including retail banking through its wholly owned subsidiary, Banco Itau SA(Itau), corporate banking through its wholly owned subsidiary, Banco Itau BBA SA (Itau BBA) and consumer credit to non-account hold customers through Itaucred -- credit cards, asset management and insurance, private retirement plans and capitalization plans, a type of savings plan. Itau Holding provides a variety of credit and non-credit products and services directed towards individuals, small and middle market companies and large corporations. The bank has offices in Miami, New York, Hongkong, Lisbon, Luxembourg, Bahamas, the Cayman Islands, Chile and Uruguay. * * * As reported in the Troubled Company Reporter-Latin America on Feb. 12, 2007, Fitch changed the outlook of Banco Itau Holding Financiera S.A.'s 'BB+' foreign currency IDR rating to positive from stable. BANCO NACIONAL: Inks Partnership Pact with Banco Itau ----------------------------------------------------- Banco Nacional de Desenvolvimento Economico e Social has signed a partnership agreement with Banco Itau Holding Financeira SA to fund energy efficiency projects. Business News Americas relates that Banco Nacional will implement its energy efficiency program Proesco with Banco Itau as the financial agent. Banco Nacional will share financial risk with Banco Itau, with Banco Nacional taking 80% and Banco Itau taking 20%. About Banco Itau Banco Itau Holding Financeira SA -- http://www.itau.com.br/-- is a private bank in Brazil. The company has four principal operations: banking -- including retail banking through its wholly owned subsidiary, Banco Itau SA(Itau), corporate banking through its wholly owned subsidiary, Banco Itau BBA SA (Itau BBA) and consumer credit to non-account hold customers through Itaucred -- credit cards, asset management and insurance, private retirement plans and capitalization plans, a type of savings plan. Itau Holding provides a variety of credit and non-credit products and services directed towards individuals, small and middle market companies and large corporations. The bank has offices in Miami, New York, Hongkong, Lisbon, Luxembourg, Bahamas, the Cayman Islands, Chile and Uruguay. About Banco Nacional Banco Nacional de Desenvolvimento Economico e Social is Brazil's national development bank. It provides financing for projects within Brazil and plays a major role in the privatization programs undertaken by the federal government. * * * Banco Nacional currently carries a Ba2 foreign long-term bank deposit rating from Moody's Investors Service, and a BB+ long- term foreign issuer credit rating from Standards and Poor's Ratings Services. The ratings were assigned in August and May 2007. BANCO NACIONAL: Lending Rises to BRL70.2B in 12 Mos. Ended March ---------------------------------------------------------------- Banco Nacional de Desenvolvimento Economico e Social increased lending by 24% to BRL70.2 billion in the 12 months ended March 2008, from the previous period. Business News Americas relates that Banco Nacional's loans rose 22% to BRL103 billion in the 12 months ended March 2008, compared to the previous period. According to BNamericas, Banco Nacional's lending for infrastructure projects grew 65% to BRL27.7 billion in the 12 months ended March 2008, from the previous period, and accounted for 40% of all the bank's financing in the period. BNamericas notes that approved loans for infrastructure rose 61% to BRL43.8 billion in the 12 months ended March 2008, compared to the previous period. The report says that the manufacturing sector received BRL28.5 billion in the 12 months ended March 2008, about 5% lower compared to the previous period. It represented 41% of all Banco Nacional loans in the year. Banco Nacional authorized BRL16.5 billion in financing in the first quarter 2008, about 47% greater than the first quarter 2007. Loan approvals rose 22% to BRL21.7 billion in the first quarter 2008, compared to the same quarter in 2007, 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. BANCO NACIONAL: Supports Jirau Power Plant, Madeira River --------------------------------------------------------- Banco Nacional de Desenvolvimento Economico e Social has set up its support and a potential shareholding interest for Jirau Power Plant construction. Located on Madeira River, in Rondonia, the plant will deliver an installed capacity of 3,300 megawatts. It is one of the largest energy projects of the Growth Acceleration Project (PAC). A bidding process will start on May 12. The winning bidder, that is, the new Jirau Power Plant concessionaire will be the consortium offering the lowest energy rate, which will be used to set the energy price for a 30-year term for utilities companies. The concessionaire must build the plant and start producing electric power on 2013. The conditions defined by BNDES to support Jirau Power Plant are quite similar to the ones required for the support to Santo Antonio Power Plant, also on Madeira River. The Santo Antonio Power Plant bid was held on Dec. 10, 2007. The winning bidder was the consortium consisting of Odebrecht, Furnas, Cemig, Andrade Gutierrez and the Private Equity Investment Fund of Santander and Banif. The below-par price given in the bid reached 35% against the maximum price of the bid – BRL122,00/MWh. The winning consortium offered BRL78,87 per MWh. The fierce competition in Santo Antonio Power Plant bid, as we seen in the below-par value, shows that energy output in the Amazon region is quite attractive. The bidding outcome also puts forward good results in terms of low rates. The project, currently analyzed at the Bank, generates positive social impacts due to the regional development and it is also environmentally sustainable. BNDES management made three changes on the financial support to the Jirau Power Plant winning bidder, so as to foster a fiercer competition: -- The bidder can choose the PRICE system (flat installment system) instead of SAC (variable installments) in the loan amortization. -- Adoption of loan service coverage index of 1.2. -- Shareholders are liable to keep a reserve account with 6 months of loan service when the loan service coverage index is below 1,3 and a decrease for 3 months of reserve account when the coverage index is higher than 1,3. Financial Support According to the rules approved by the Bank’s management, half of the financing will be made directly by BNDES, and the other half will made through accredited financial institutions. The Bank’s support, given through direct and indirect financing, will be limited to 75% of total investment. Shareholders’ capital will be no lower than 20% of the project's amount, excluding, for calculation purposes, any interest of the BNDES’ private equity arm, BNDES Participacoes S.A. a.k.a. BNDESPAR. The interest limit of BNDES system may be 10% to 20% of the company’s capital stock to be constituted for the plant construction. BNDESPAR may only join the winning group if the consortium control is mostly private. Additionally, the winning bidder must hold an Initial Public Offering within a period to be set out during the analysis of the project of common share and must also present corporate governance practices matching the new market practices. The Bank’s financial contribution may be made through corporate financing (financing to companies) and/or through project finance (financing to the project). The beneficiary must be a Specific Purpose Company (SPC), setup to separate project cash flows, equity and risks. Cost -– In the direct category, the loan total amount will be at the Long-Term Interest Rate (currently at 6.25%) plus the BNDES basic spread, of 0.5% per annum and credit risk rate, ranging between 0.46% to 2.54% per annum, depending on the project risk rating. Interest rates will be capitalized during the grace period. Maturities -– Maximum loan maturity is 25 years from the project startup, with maximum grace period of six months after the expected date for the turbine set commercial operation date. Amortization will be 20 years. Collaterals -- Collaterals will be set according to the technical and economic analysis of the project and shareholders. Possible collaterals: pledge of shares, pledge of credit rights, reserves of medium of exchange, bank and/or corporate surety bond and insurance. BNDES also requires that shareholders prove their capacity to contribute with their own funds, indicating the source, availability and contribution schedule. It also requires proof of technical, economic and financial capacity of project owners. The assessment will be made based on the consolidated balance sheet of each company or economic group, audited by a company listed in the Comissao de Valores Mobiliarios (Brazilian Securities and Exchange Commission - CVM). For the shareholders of each consortium participating in Jirau’s bid, the sum of the shareholders' equity and the total assets of economic groups and/or companies must be higher or equal to BRL9 billion and BRL20 billion, respectively. BNDESPAR Interest -- BNDESPAR may only join the winning group if the consortium control is mostly private. Additionally, the winning bidder must hold an Initial Public Offering within a period to be set out during the analysis of the project, consisting of common shares only. Banco Nacional de Desenvolvimento Economico e Social is Brazil's national development bank. It provides financing for projects within Brazil and plays a major role in the privatization programs undertaken by the federal government. * * * Banco Nacional currently carries a Ba2 foreign long-term bank deposit rating from Moody's Investors Service, and a BB+ long- term foreign issuer credit rating from Standards and Poor's Ratings Services. The ratings were assigned in August and May 2007. BANCO NACIONAL: Ups Doc Collection Preservation Funds to BRL8MM --------------------------------------------------------------- Banco Nacional de Desenvolvimento Economico e Social has approved an increase for the Public Selection of Document Collection Preservation Projects of 2008. The funds will jump from BRL6 million to BRL8 million. The maximum limit for each project, previously BRL500,000, jumps to BRL800,000. Enrollments for this year’s selection will be open until June 6. The non-reimbursable financial support is intended to the recovery of text, iconographic, sound and visual documents belonging to archive collections. It also covers hard copies, books and rare journals, as well as all kinds of material testimonials, under the custody of a museum or a similar institution. The commission consists of three specialists and representatives of BNDES and the Culture Ministry. The selection process will have a phase where all projects enrolled will be analyzed and ranked according to the score attained. In the following phase, all documents belonging to the shortlisted projects will be legally reviewed for qualification and registration check of the bidder and the institution holding the documental collection. And lastly, after a technical visit to the shortlisted institutions, a list of the winning projects is disclosed. From Oct. 5, 2004 -– when BNDES designed the Program for Support of Documental Collection Preservation Projects -–, up to now, three requests for proposals have been issued and 97 projects have been supported, with funds amounting to BRL16,4 million. BNDES is currently one of the institutions that most invest in the preservation of documents, as it is aware of the difficulties faced in the protection of archive, bibliographic and museum-related documents in Brazil. The program intends to modernize museums, archives and libraries, to preserve and safeguard their documents, as well as improve the service and access of people. The Bank, then, has designed a financial support divided into the following phases: catalogue organization, cleaning and packaging, restoration, environmental management, security and infrastructure system installation. Since the program was designed, BNDES has received a greater demand for projects from several Brazilian institutions and regions. Likewise, with the Bank's ongoing support, renowned cultural institutions that have undergone the fundamental phaes of the document collection restoration process, outline in their request for proposal increasingly robust and elaborate projects, which caused BNDES to consider the importance of increasing the financial support. The previous request for proposals included projects such as the restructuring of the Historic Collection of Santa Casa de Misericordia in Bahia; the catalogue organization and cleaning of documents concerning the arrival of foreigners to Brazil, kept by Arquivo Nacional (the Brazilian National Archive), in Rio de Janeiro; structural improvements and safeguarding for the collection of Museu de Marajo, in Para; modernization and enlargement of the security systems protecting the Art Gallery of Sao Paulo state; and the conservation and technical processing of Informacao do Fundo de Codices do Arquivo Publico do Parana (Parana State Public Archive Codex Fund Information). Last year, BNDES received 213 enrollments and, out of these, 192 were reviewed. Out of the projects received, 52% came from the Southeast region, 24% from the Northeast, 15% from the South, 6% from the North and 3% from the Center West. Banco Nacional de Desenvolvimento Economico e Social is Brazil's national development bank. It provides financing for projects within Brazil and plays a major role in the privatization programs undertaken by the federal government. * * * Banco Nacional currently carries a Ba2 foreign long-term bank deposit rating from Moody's Investors Service, and a BB+ long- term foreign issuer credit rating from Standards and Poor's Ratings Services. The ratings were assigned in August and May 2007. BRASIL TELECOM: Moody's Continues Review After Telemar Merger ------------------------------------------------------------- Moody's Investors Service's Ba1 global scale senior unsecured issuer rating for Brasil Telecom S.A. remains under review for possible upgrade following the announcement of the acquisition by Telemar Norte Leste S.A. (rated Baa2; stable outlook) of a controlling interest in Brasil Telecom Participacoes S.A., the holding company for Brasil Telecom SA. Moody's notes that the conclusion of the deal is subject to a change in the Brazilian telecommunication regulation and the approvals of the regulator ANATEL and the antitrust authority CADE, which is estimated to take up to eight months. Although the timing for the change in the regulatory framework and approval by the regulator and antitrust is uncertain, Moody's expects approval is likely to occur without major restrictions, and will be an additional positive consideration for Brasil Telecom's rating review. The review of Brasil Telecom's rating was initiated on March 28, 2008, based on the company's achievement of positive margins in its mobile telephony business, cost reduction efforts and maintenance of strong credit metrics. The review will continue to focus on the sustainability of Brasil Telecom's credit metrics in light of the significant changes expected for the Brazilian telecommunications industry over the near to medium term, including the introduction of number portability and several changes in the regulatory framework intended to promote competition. In addition, the review will consider recent trends in traffic, revenue and margins by product and the company's financial policy going forward, in particular with regard to dividend payout. Headquartered in Brasilia, Brasil Telecom S.A. -- http://www.brasiltelecom.com.br-- is an integrated telecommunications company operating in nine states in the southern, mid-western and northern regions of Brazil. In 2007, the company reported consolidated net revenues of BRL11.1 billion. BRASIL TELECOM: Tele Norte to Form New Telecom Through Firm ----------------------------------------------------------- Tele Norte Leste Participacoes SA wants to create a multinational telecommunications company through Brasil Telecom Participacoes SA. According to Tele Norte, the new firm will be under Brazilian control and with international reach and will aim to have a total of 110 million clients in five