T R O U B L E D C O M P A N Y R E P O R T E R L A T I N A M E R I C A Wednesday, May 7, 2008, Vol. 9, No. 90 Headlines A N T I G U A & B A R B U D A ROYAL CARIBBEAN: In Talks With Antigua Gov't for Cruise Complex A R G E N T I N A ALITALIA SPA: Group Net Debt at EUR1.35 Billion as of March 31 CORDOBA COMPUTACION: Individual Reports to be Filed on Aug. 11 DARRESA SA: Trustee to File Individual Reports in Court Tomorrow DELTA AIR: Posts First Quarter 2008 Net Loss of US$6,390,000,000 DELTA AIR: Merger With Northwest Will Result in 1,000 Cut Jobs DELTA AIR: Internal Revenue Service Withdraws US$11.8 Bln Claims DELTA AIR: JPMorgan Chase Holds 15% of Outstanding Common Stock ESTABLECIMIENTO AVICOLA: Trustee Verifies Claims Until July 17 GMAC LLC: ResCap Unit Launches Exchange Offer for US$12.8B Notes GMAC LLC: Fitch Cuts ID Rating to BB- After ResCap's Poor Fin'l GMAC LLC: S&P 'B' Rating Unaffected by ResCap's Downgrades GUSTAVO DECORACIONES: Claims Verification Deadline Is July 1 HERMANOS CAMPAGNA: Proofs of Claim Verification is Until June 19 ORVEA SRL: Trustee to Present General Report in Court Tomorrow PETER PAN: Trustee to Present General Report in Court Tomorrow RAYCOL SA: Trustee to File General Report in Court Tomorrow TARPIN RICARDO: Trustee to File Individual Reports Tomorrow TRATO SA: Proofs of Claim Verification Deadline Is June 11 YPF SA: Chubut Awards 2 Gan-Gan Blocks to Firm's Joint Venture B E L I Z E INTERPUBLIC GROUP: Net Loss Down to US$62MM in 2008 1st Quarter B E R M U D A SEA CONTAINERS: Inks Settlement Deal with General Electric B O L I V I A INTERNATIONAL PAPER: Net Income Drops to US$133MM in 1st Quarter B R A Z I L ABC BRASIL: Net Profit Increases to BRL38 in First Quarter 2008 ATARI INC: Signs US$11 Mil. Infogrames Entertainment Merger Deal BANCO BRASCAN: Fitch Lifts Ratings After Brookfield Deal Closing BANCO DAYCOVAL: Joins Brasil Index of Bovespa Stock Exchange BANCO NACIONAL: May Turn to Int'l Capital Markets to Raise Funds BLOUNT INT'L: Acquires Carlton Holdings for US$63,000,000 BRASIL TELECOM: Launches 3G Services CAMARGO CORREA: To Bid With Eletrosul, Chesf & Suez for Jirau CIA. ENERGETICA: Tops Utility Stocks After UBS Boosts Rating GENERAL MOTORS: ResCap's Offer Does Not Affect S&P's Neg. Watch GOL LINHAS: Issues Passenger Traffic Statistics for April 2008 JAPAN AIRLINES: Inks JALCARD Transfer Pact With Mitsubishi UFJ PARANA BANCO: Will Issue American Depository Receipts in NYSE POLYPORE INT'L: Better Performance Cues Moody's to Lift Ratings TELE NORTE: Net Profit Increases to BRL486MM in 1st Quarter 2008 TELE NORTE: To Hold Extraordinary Shareholders Meeting on May 20 UAL CORPORATION: ReGen Insists Cure Amount Worth US$4,272,555 UAL CORPORATION: Union Workers Denounce New Incentive Plan USINAS SIDERURGICAS: J Mendes To Produce 5 Million Tons in 2008 USINAS SIDERURGICAS: Positive About Local Economy & Steel Demand * BRAZIL: S&P Lifts L-T Sovereign Credit Rating to BBB- From BB+ C A Y M A N I S L A N D S FORGINGS INTERNATIONAL: Claims Filing Deadline Is Until May 11 NETWORKASIA: Deadline for Proofs of Claim Filing Is Until May 9 QI CAPITAL: Proofs of Claim Filing Deadline Is Until May 12 PARMALAT SPA: Seeking US$2.2BB Damages vs Citigroup at NJ Case USFR LIMITED: Proofs of Claim Filing Deadline Is Until May 12 USFR LIMITED: Will Hold Final Shareholders Meeting on May 12 XINEX CO: Will Hold Final Shareholders Meeting on May 13 C H I L E COEUR D'ALENE: Cerro Bayo Mine Resumes Operations C O L O M B I A BANCOLOMBIA SA: Will Host Luncheon at NYSE Euronext on May 12 C O S T A R I C A ALCATEL-LUCENT: Costa Rica Invites Firm to Bid for 3G Contract US AIRWAYS: Incurs US$236 Million Net Loss in First Quarter 2008 J A M A I C A AIR JAMAICA: Gov't Inks Pact With U.S. for J$59MM Grant Funding CASH PLUS: Carlos Hill Gets Out of Jail on J$15 Million Bail M E X I C O CHALLENGER POWERBOATS: Auditor Raises Going Concern Doubt CHALLENGER POWERBOATS: Files Chapter 7 Petition in Missouri CORPORACION DURANGO: S&P Puts B+ Credit Rating on Negative Watch MEXORO MINERALS: Ties Up With Paramount Gold and Silver Corp. PRIDE INT'L: Will Start Contract With Petrobras for Rig in June RESIDENTIAL CAPITAL: Commences Exchange Offer for US$12.8B Notes RESIDENTIAL CAPITAL: S&P Cuts Corp. Credit to CC on Debt Offer RESIDENTIAL CAPITAL: Debt Exchange Offer Cues Fitch's Rating Cut RESIDENTIAL CAPITAL: Moody's Cut Rating to Ca on Exchange Offer SOLO CUP: Fitch Affirms Ratings and Revises Outlook to Positive N I C A R A G U A INFINITY ENERGY: NASDAQ Global Delisting Takes Effect on May 9 P A N A M A CHIQUITA BRANDS: Turns Around With US$31.7MM Income in 1Q 2008 U R U G U A Y BANCO HIPOTECARIO: Earns UYU274 Mil. in First Two Months of 2008 V E N E Z U E L A NORTHWEST AIRLINES: Posts US$4.1 Billion First Quarter Net Loss NORTHWEST AIRLINES: Delta Merger to Result in 1,000 Cut Jobs TAM SA: Will Publish First Quarter 2008 Results on May 12 V I R G I N I S L A N D S NVIDIA CORPORATION: Annual Stockholders Meeting Set for June 19 - - - - - =============================== A N T I G U A & B A R B U D A =============================== ROYAL CARIBBEAN: In Talks With Antigua Gov't for Cruise Complex --------------------------------------------------------------- Caribbean 360 reports that Royal Caribbean Cruises Ltd. is negotiating a partnership with the government of Antigua and Barbuda for a proposed development and expansion of the cruise complex in St. John and "its environs." Royal Caribbean presented the project to the cabinet during its Commercial and New Business Development Vice President John Tercek's visit to Antigua & Barbuda, Caribbean 360 relates. Mr. Tereck told Caribbean 360 that there was great potential for the development of the St. John's waterfront. According to Caribbean 360, the proposed development takes into consideration opportunities for: -- improved road and parking infrastructure; -- enhancement of linkages between all of the waterfront properties; -- improved berthing facilities and an additional berth at the Deep Water Harbour; -- comprehensive signage program that incorporates informational, directional and regulatory signs and lighting; -- a taxi dispatch and welcome center; -- modern restroom facilities; -- a yacht marina and slips; -- a downtown boutique hotel; -- residential and entertainment facilities; -- restaurants and bars; -- designer shopping boutiques; -- a boardwalk and beautifications; and -- landscaping of entire areas. Headquartered in Miami, Royal Caribbean Cruises Ltd. (NYSE: RCL) -- http://www.royalcaribbean.com/-- is a global cruise vacation company that operates Royal Caribbean International, Celebrity Cruises and Pullmantur Cruises, Azamara Cruises and CDF Croisieres de France. The company has a combined total of 35 ships in service and seven under construction. It also offers unique land-tour vacations in Alaska, Australia, China, Canada, Europe, Latin America and New Zealand. The company has operations in Puerto Rico. * * * As reported in the Troubled Company Reporter-Latin America on April 8, 2008, Standard & Poor's Ratings Services lowered the corporate credit rating on Royal Caribbean Cruises Ltd. to 'BB+' from 'BBB-'. S&P said the rating outlook is stable. ================= A R G E N T I N A ================= ALITALIA SPA: Group Net Debt at EUR1.35 Billion as of March 31 -------------------------------------------------------------- Alitalia Group’s net debt as of March 31, 2008, amounted to EUR1.353 billion, showing a decrease in net indebtedness of EUR15 million compared to the situation on Feb. 29, 2008, announced on Feb. 28, 2008. The amount includes the encashment of EUR79 million relating to the sale of Air France-KLM shares held in portfolio and the disbursement of EUR56 million in payment of the annual dividend coupon for the convertible bond loan. Not included is the encashment of fiscal credit amounting to about EUR69 million, which took place on April 2, 0028. The net debt of the parent company Alitalia on March 31, 2008, (including short-term financial credits of subsidiaries) amounted to EUR1.347 billion showing a decrease of EUR10 million (-0.7%) compared to net debt as of Feb. 29, 2008. The Group’s cash-to-hand and short-term financial credits as of March 31, 2008, at the Group level and for Alitalia, amounted to EUR180 million and EUR186 million respectively. It should be noted that as of March 31, 2008, there were several leasing contracts at the Group level (referring almost entirely to fleet aircraft mostly held by the parent company amounting to EUR80 million) whose capital share, including lease closure value, amounted to EUR92 million (of which EUR12 million represent the current capital share falling due within 12 months of the reference date, with EUR9 million held by the parent company). It should also be noted that existing debts to banks are almost entirely backed up by real guarantees (mortgages on aircraft) or by personal guarantees (mainly guarantees issued by banks for export credit). The relative financing contracts contain standard legal clauses relating to withdrawal. None of the contracts refer to specific requirements regarding assets or economic/financial aspects, in order to maintain the credit line. During March 2008, repayments were made of medium/long-term financing amounting to EUR13 million. Regarding debts of a financial, fiscal and social welfare nature, there were no outstanding sums or payment irregularities on March 31, 2008, both for the parent company and for the other companies in the Group. As far as debts of a commercial nature are concerned, decisions are still pending for the petitions filed by Alitalia regarding: * an injunction related to supposed different pricing policies, issued by a carrier for EUR6 million (two decrees); * an injunction issued by a supplier of on-board movies for EUR1.2 million (two decrees); * an injunction has been issued by an IT services supplier for EUR812,000; * an injunction has been issued by an Italian subsidiary of an air carrier bankruptcy for EUR288,000; * an injunction has been issued by a maintenance services supplier for EUR492,000; * an injunction has been issued by the special manager of a firm for presumed debts relating to air ticket sales, for EUR3.2 million; * one injunction issued by a fuel supplier for about EUR1 million; * an injunction has been issued by an airport management company for limited failure to pay handling fees for about EUR375,000; and * an injunction has been issued by four suppliers, for EUR188,000. There are no other executive actions undertaken by creditors notified as of March 31, 2008, nor are there any threats by suppliers to suspend operations. It should be pointed out that, as part of ordinary management practices, the Company is committed to maintaining commercial relations with its customers and suppliers who guarantee -– in the absence of critical situations or operational emergencies -– the necessary financial flexibility in support of cash-to-hand requirements. 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. CORDOBA COMPUTACION: Individual Reports to be Filed on Aug. 11 -------------------------------------------------------------- Julio Salaberry, the court-appointed trustee for Cordoba Computacion S.A.'s bankruptcy proceeding, will present the validated claims as individual reports in the National Commercial Court of First Instance in Buenos Aires on Aug. 11, 2008. Mr. Salaberry will be verifying creditors' proofs of claim until June 12, 2008. He will submit to court a general report containing an audit of Cordoba Computacion's accounting and banking records on Sept. 22, 2008. Mr. Salaberry is also in charge of administering Cordoba Computacion's assets under court supervision and will take part in their disposal to the extent established by law. The debtor can be reached at: Cordoba Computacion SA Cordoba 3485 Buenos Aires, Argentina The trustee can be reached at: Julio Salaberry Uruguay 766 Buenos Aires, Argentina DARRESA SA: Trustee to File Individual Reports in Court Tomorrow ---------------------------------------------------------------- Roberto Mazzarella, the court-appointed trustee for Darresa S.A.'s bankruptcy proceeding, will present the validated claims as individual reports in the National Commercial Court of First Instance in Buenos Aires on May 8, 2008. Mr. Mazzarella verified creditors' proofs of claim until March 27, 2008. He will submit to court a general report containing an audit of Darresa's accounting and banking records on June 19, 2008. Mr. Mazzarella is also in charge of administering Darresa's assets under court supervision and will take part in their disposal to the extent established by law. The trustee can be reached at: Roberto Mazzarella Ortega y Gaset 1827 Buenos Aires, Argentina DELTA AIR: Posts First Quarter 2008 Net Loss of US$6,390,000,000 ---------------------------------------------------------------- Delta Air Lines Inc. reported results for the quarter ended March 31, 2008. Key points include: * On April 14, 2008, Delta announced an agreement to merge with Northwest; the transaction will create America's premier global airline, which is expected to generate in excess of US$1,000,000,000 in annual revenue and cost synergies; * Delta's net loss for the first quarter excluding special items was US$274,000,000, or US$0.69 per diluted share, driven by a US$585,000,000 year over year increase in the cost of fuel; * Delta's reported net loss for the March 2008 quarter was US$6,400,000,000, or US$16.15 per diluted share; * special items include a US$6,100,000,000 non-cash goodwill impairment charge from the decline in Delta's market capitalization due to sustained record fuel prices; * as of March 31, 2008, Delta had US$3,600,000,000 in unrestricted liquidity, including US$1,000,000 available under its revolving credit facility. Response to Record Fuel Prices On March 18, Delta announced that it had aggressively recalibrated its 2008 business plan with a focus on preserving liquidity in light of the significant increase in crude oil prices. The airline reevaluated its capacity, targeting reductions in or cancellations of unprofitable routes, and has already implemented schedule changes to bring down domestic flying. Delta now expects system capacity for the second half of 2008 to be down 0-2% compared to 2007, with domestic capacity down 9-11%. As a result of the capacity reduction, the company is removing 15-20 mainline and 60-70 regional jet aircraft from its operations by the end of 2008. Delta is continuing to evaluate the fuel and demand environment and will make proactive changes quickly if economic conditions warrant. Delta is also accelerating revenue and productivity initiatives to help address high fuel costs, as well as reducing capital spending. These measures will provide revenue and cost benefits of US$150,000,000in 2008, equivalent to US$350,000,000 on an annual basis, in addition to the US$400,000,000 in productivity initiatives previously announced. Financial Performance Delta reported a net loss of US$274,000,000 in the first quarter of 2008 compared to a net loss of US$6,000,000 in the first quarter of 2007, excluding special and reorganization items. The US$268,000,000 year over year increase in net loss was driven by a US$585,000,000 increase in costs due to higher fuel price. Delta did not record an income tax benefit in the March 2008 quarter. Revenue Momentum Passenger revenue increased 10% in the first quarter of 2008 on a 2% increase in capacity compared to the prior year period, demonstrating Delta's momentum from its network transformation and revenue management initiatives. The increase in passenger revenue was driven by 6% higher yield and 4% higher traffic. Delta's international expansion has contributed significantly to passenger revenue growth, as the airline has launched nearly 90 new international routes since the summer of 2005, including Tel Aviv, Prague, Dubai, London-Heathrow and Shanghai. Delta has grown the percentage of its capacity operating in international markets from 25% in the March 2006 quarter to 33% in the March 2008 quarter. Delta expects more than 40% of capacity to be deployed in international markets by summer 2008. Based on the most recently available ATA data, Delta's consolidated length of haul adjusted passenger unit revenue (PRASM) was 101% of industry average PRASM, excluding Delta, up from 86% in 2005 when the company began its network restructuring. This represents the first quarter in eight years that Delta has exceeded industry average. Delta's selection of unique and distinct markets has allowed the company to grow international unit revenues and capacity at double digit rates. Delta's international PRASM grew 13% year over year in the March 2008 quarter, with strong yield gains in the trans-Atlantic and Latin markets. Domestic PRASM increased 6% on a capacity decline of 2%. Consolidated system PRASM improved more than 7% to 11.36 cents. Non-passenger revenue was also strong in the first quarter. Revenue from Cargo operations increased 20% compared to the March 2007 quarter. Other net revenues grew US$133 million, or 33%, primarily due to an increase in passenger fees and charges, revenue from SkyMiles, and maintenance services provided to third parties. Cost Discipline Excluding special items described below, Delta's operating expenses increased 20%, or US$825,000,000 compared to the first quarter of 2007, largely due to the US$585,000,000 increase in costs due to higher fuel prices. The remainder of the increase in operating expense was due primarily to fresh start accounting, salary and benefit enhancements for Delta's employees, and the cost of increased capacity versus the prior year quarter. For the March 2008 quarter, non-operating expenses declined 20%, or US$32,000,000, due primarily to lower effective interest rates (including the impact of fresh start reporting) and interest earned on higher average cash balances, which were partially offset by FAS 133 mark-to-market on hedges. Delta's mainline unit cost (CASM5) increased 16% to 11.64 cents compared to the prior year period, reflecting the significant increase in fuel costs. Excluding fuel expense, mainline CASM increased 4% to 7.31 cents compared to the March quarter of 2007. "We have moved quickly to mitigate the short-term impact of higher fuel prices by further reducing domestic capacity and taking a disciplined approach to costs and cash flow. These actions have offset more than 50% of the fuel price impact," said Edward Bastian, Delta's president and chief financial officer. "However, we clearly need to do more. Merging with Northwest will generate over US$1,000,000,000 in annual synergies, providing a more durable financial foundation for the future and giving Delta a stronger platform for profitable, long-term growth," he said. Special and Reorganization Items Delta recorded special items of US$6,100,000,000 in the March 2008 quarter, including (i) a US$6,100,000,000 non-cash goodwill impairment charge due to a decline in Delta's market capitalization caused by sustained record fuel prices, and (ii) a US$16,000,000 charge for severance for the previously announced voluntary workforce reduction programs. Upon emergence from bankruptcy, Delta recorded a US$12,000,000,000 goodwill balance under fresh start accounting. The valuation of goodwill was predicated on the company's market value at that point of US$9,400,000,000 billion. A key assumption in that valuation was the price of fuel of US$70 per barrel. Crude oil recently traded over US$117 per barrel, with refining spreads in the US$20-US$30 range, significantly impacting Delta's single largest operating expense and future projected discounted cash flows. Based on the difference between Delta's book equity and an updated stand-alone valuation reflecting current fuel and economic assumptions, prepared in connection with Delta's recently announced merger with Northwest, Delta recorded a non- cash goodwill impairment charge of US$6,100,000,000. In the March 2007 quarter, Delta recorded reorganization expenses totaling US$124,000,000. Liquidity Position During the quarter, Delta issued US$733,000,000 in debt, a portion of which was used to refinance Delta's 2003-1 EETC maturity. Delta had approximately US$550,000,000 in net capital expenditures during the March 2008 quarter, with approximately US$500,000,000 for investments in aircraft, parts and modifications to improve Delta's international product and position the airline for continued international growth. At the end of the March 2008 quarter, Delta had US$2,800,000,000 in cash, cash equivalents and short-term investments, of which US$2,600,000,000 was unrestricted. Delta has an additional US$1,000,000,000 available under its revolving credit facility, resulting in a total of US$3,600,000,000 in unrestricted liquidity at quarter end. As of March 31, 2008, Delta had US$103,000,000 in auction-rate securities classified as short- term investments on its balance sheet. The company's March 31, 2008 balance sheet showed total assets of US$26,755,000,000, total liabilities of US$22,804,000,000, and total stockholders' equity of US$3,951,000,000. March 2008 Quarter Highlights During the first quarter, Delta continued its international expansion and made targeted investments in its products, services, and employees to deliver an industry-leading customer experience. Highlights include, Delta: -- made strong improvements to its operational performance reducing involuntary denied boardings by nearly 50%, improving baggage performance by 3.6%, and ranking first among the network carriers in on-time performance, including a first place ranking in on-time performance at its hubs in Atlanta, New York-JFK, and Cincinnati for the month of February; -- launched the joint venture with Air France, including three new trans-Atlantic routes connecting London- Heathrow to Los Angeles, Atlanta and New York-JFK, filling a key position in Delta's portfolio by connecting our international gateways in Atlanta and New York to one of the world's premier business airports; -- continued its commitment to Delta employees -- awarded US$158,000,000 in profit sharing in recognition of 2007 financial results, instituted benefits enhancements on Jan. 1, contributed US$25,000,000 to employee pensions, and paid US$6,000,000 in Shared Rewards for achieving operational goals; -- enhanced Atlanta's position as a powerful Asian gateway by beginning the first-ever nonstop flight between Atlanta and Shanghai, complementing existing service to Tokyo and Seoul; -- celebrated being the first U.S. carrier to add the world's longest range commercial jetliner to its fleet by taking delivery of two of the eight Boeing 777-200LR aircraft expected to be delivered through 2009. With the new aircraft, Delta strengthens its ability to connect customers and cargo between virtually any two cities around the globe, nonstop; -- ranked as the top U.S. carrier to Latin America by readers of Latin Trade magazine and second overall on the magazine's "best of" list. Latin Trade readers also gave Delta the highest ranking in ticketing and boarding experience, and second highest ranking in frequent flier program among traditional network carriers in the U.S. and Latin America; -- provided SkyMiles members with more ways to redeem their miles by initiating a "Pay with Miles" program in partnership with American Express, expanding access to Medallion(R) Marketplace, growing the SkyMiles online auction program, and enhancing the Award Travel search calendar on delta.com; and -- enhanced customers' onboard experience by expanding the popular food for sale program, EATS, beginning April 1 to all flights within the U.S. of 750 miles or more and select flights between the U. S. and destinations in the Caribbean and Latin America. Delta's first quarter results on Form 10-Q may be accessed at no charge at: http://ResearchArchives.com/t/s?2b7a About Delta Air Based in Atlanta, Georgia, Delta Air Lines Inc. (NYSE:DAL) -- http://www.delta.com/-- is the world's second-largest airline in terms of passengers carried and the leading U.S. carrier across the Atlantic, offering daily flights to 328 destinations in 56 countries on Delta, Song, Delta Shuttle, the Delta Connection carriers and its worldwide partners. Delta flies to Argentina, Australia and the United Kingdom, among others. The company and 18 affiliates filed for chapter 11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represents the Debtors in their restructuring efforts. Timothy R. Coleman at The Blackstone Group L.P. provides the Debtors with financial advice. Daniel H. Golden, Esq., and Lisa G. Beckerman, Esq., at Akin Gump Strauss Hauer & Feld LLP, provide the Official Committee of Unsecured Creditors with legal advice. John McKenna, Jr., at Houlihan Lokey Howard & Zukin Capital and James S. Feltman at Mesirow Financial Consulting, LLC, serve as the Committee's financial advisors. The Debtors filed a chapter 11 plan of reorganization and disclosure statement explaining that plan on Dec. 19, 2007. On Jan. 19, 2007, they filed revisions to the plan and disclosure statement, and submitted further revisions to the plan on Feb. 2, 2007. On Feb. 7, 2007, the Court approved the Debtors' disclosure statement. In April 25, 2007, the Court confirmed the Debtors' plan. That plan became effective on April 30, 2007. The Court entered a final decree closing 17 cases on Sept. 26, 2007. (Delta Air Lines Bankruptcy News, Issue No. 96; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). * * * In January 2008, Standard and Poor's said that media reports that Delta Air Lines Inc. (B/Positive/--) entered into merger talks with UAL Corp. (B/Stable/--) and Northwest Airlines Corp. (B+/Stable/--) will have no effect on the ratings or outlook on Delta, but that confirmed merger negotiations would result in S&P's placing ratings of Delta and other airlines involved on CreditWatch, most likely with developing or negative implications. DELTA AIR: Merger With Northwest Will Result in 1,000 Cut Jobs -------------------------------------------------------------- In a testimony before Congress, Delta Air Lines, Inc. Chief Executive Officer Richard Anderson disclosed that a merger with Northwest Airlines, Inc., will mean the loss of a "guess-timate" of 1,000 additional jobs, the Atlanta-Journal Constitution reports. According to Mr. Anderson, the job losses would come after the deal closes, and would be concentrated on "the management jobs, not the front-line jobs" that would involve "finance, accounting -- the functions that are important in the headquarters." The layoff is part of an effort to save on costs to offset skyrocketing fuel prices, Mr. Anderson told the Committees in the House and the Senate. Mr. Anderson will be chief executive officer of the merged airline. Delta and Northwest have recently launched their campaign in Washington, D.C., by testifying before Senate and Congress hearings. Majority of the lawmakers "appeared friendly" of the proposed consolidation, finding, among other things, that there is "very little overlap" in the carriers' routes, and agreeing that "fuel costs really are a game-changer." Prior to the hearings, Mr. Anderson told The Associated Press that regardless of the merger, Delta and Northwest will continue to adjust capacity to demand as fuel prices continue at current levels. "That's the rational thing to do, and we'll continue to do that," he maintained. After the hearing, Delta spokeswoman Chris Kelly told AJC that because the consolidated company would be based in Atlanta, more of the job cuts may be from Northwest because they may not want to make the move to Georgia. In the coming months, the two airlines will face additional hearings. Regulators and shareholders will reveal whether they approve the combination, the AP says. NWA's CEO Stands to Get US$22.1MM After Merger Northwest CEO Doug Steenland, according to Business Week of Minnesota, will get about US$22.1 million when he resigns after the Delta merger. Business Week adds that in 2007, Mr. Steenland pooled US$27 million, including US$6 million in stock options following Northwest's bankruptcy exit. The report comments that the stock option is "currently worthless" since the exercise price of US$22 per share is twice the company's current share price. Minnesota's Star Tribune reports that Northwest intends to retain Mr. Steenland after the merger and wooes the executive with US$3.6 million in stock options. Based on Star Tribune, Mr. Steenland waived his option to resign last June and get US$3.2 million in severance pay. The executive in turn opted a 375,000 "restricted retention units" as a stock-based compensation, Star Tribune says. Delta Pilots Open to Arbiter, Union Chairman Says Lee Moak, the head of executive committee of Delta's pilots union, suggested that he is open to arbitration with Northwest pilots over how to merge their seniority lists, the AP says. In a letter addressed to fellow pilots, Mr. Moak said that union leaders believe that seniority integration should be accomplished after negotiation of a single joint contract and, if necessary, "expedited arbitration [should] be completed before closing of a corporate transaction." Mr. Moak related that while Delta and Northwest pilots failed to reach an overall agreement on pilot seniority integration, the Delta pilots union determined "an alternative that would provide for a superior outcome not only for the pre-merger Delta pilots, but eventually for all pilots of the merged corporation." As a result, a tentative agreement between Delta management and the Delta pilots union was formed, which will provide certain modifications to the current Pilot Working Agreement, that include, among others, a three and one-half percent equity stake in the merged Company, annual pay raises, "furlough protection," and an increase in 737-700 pay rates, the letter said. Rank-and-file Delta pilots will soon be asked to vote on the proposed Agreement. The Agreement does not cover Northwest pilots, whose union has stated it supports arbitration. The statement, however, was said before Delta's pilots cut a deal with management days before the merger announcement, says the AP. Mr. Moak disclosed that Delta's pilots union welcomes the idea of partnering with the Northwest pilots "to bring about the rapid completion of a new joint contract and a fair and equitable integrated seniority list upon the effective date of the . . . Agreement." A full-text copy of Mr. Moak's letter is available for free at: http://crewroom.alpa.org/dal/DesktopDefault.aspx?tabid=2421 About Northwest Airlines Northwest Airlines Corp. (NYSE: NWA) -- http://www.nwa.com/-- is the world's fourth largest airline with hubs at Detroit, Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and about 1,400 daily departures. Northwest is a member of SkyTeam, an airline alliance that offers customers one of the world's most extensive global networks. Northwest and its travel partners serve more than 1000 cities in excess of 160 countries on six continents. Northwest and its travel partners serve more than 1000 cities in excess of 160 countries on six continents, including Italy, Spain, Japan, China, Venezuela and Argentina. The company and 12 affiliates filed for chapter 11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17930). Bruce R. Zirinsky, Esq., and Gregory M. Petrick, Esq., at Cadwalader, Wickersham & Taft LLP in New York, and Mark C. Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP in Washington represent the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors has retained Akin Gump Strauss Hauer & Feld LLP as its bankruptcy counsel in the Debtors' chapter 11 cases. When the Debtors filed for bankruptcy, they listed US$14.4 billion in total assets and US$17.9 billion in total debts. On Jan. 12, 2007 the Debtors filed with the Court their Chapter 11 Plan. On Feb. 15, 2007, they Debtors filed an Amended Plan & Disclosure Statement. The Court approved the adequacy of the Debtors' Disclosure Statement on March 26, 2007. On May 21, 2007, the Court confirmed the Debtors' Plan. The Plan took effect May 31, 2007. (Northwest Airlines Bankruptcy News, Issue No. 91; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). About Delta Air Based in Atlanta, Georgia, Delta Air Lines Inc. (NYSE:DAL) -- http://www.delta.com/-- is the world's second-largest airline in terms of passengers carried and the leading U.S. carrier across the Atlantic, offering daily flights to 328 destinations in 56 countries on Delta, Song, Delta Shuttle, the Delta Connection carriers and its worldwide partners. Delta flies to Argentina, Australia and the United Kingdom, among others. The company and 18 affiliates filed for chapter 11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represents the Debtors in their restructuring efforts. Timothy R. Coleman at The Blackstone Group L.P. provides the Debtors with financial advice. Daniel H. Golden, Esq., and Lisa G. Beckerman, Esq., at Akin Gump Strauss Hauer & Feld LLP, provide the Official Committee of Unsecured Creditors with legal advice. John McKenna, Jr., at Houlihan Lokey Howard & Zukin Capital and James S. Feltman at Mesirow Financial Consulting, LLC, serve as the Committee's financial advisors. The Debtors filed a chapter 11 plan of reorganization and disclosure statement explaining that plan on Dec. 19, 2007. On Jan. 19, 2007, they filed revisions to the plan and disclosure statement, and submitted further revisions to the plan on Feb. 2, 2007. On Feb. 7, 2007, the Court approved the Debtors' disclosure statement. In April 25, 2007, the Court confirmed the Debtors' plan. That plan became effective on April 30, 2007. The Court entered a final decree closing 17 cases on Sept. 26, 2007. (Delta Air Lines Bankruptcy News, Issue No. 96; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). * * * In January 2008, Standard and Poor's said that media reports that Delta Air Lines Inc. (B/Positive/--) entered into merger talks with UAL Corp. (B/Stable/--) and Northwest Airlines Corp. (B+/Stable/--) will have no effect on the ratings or outlook on Delta, but that confirmed merger negotiations would result in S&P's placing ratings of Delta and other airlines involved on CreditWatch, most likely with developing or negative implications. DELTA AIR: Internal Revenue Service Withdraws US$11.8 Bln Claims ---------------------------------------------------------------- The Internal Revenue Service, on behalf of the United States of America, notifies the U.S. Bankruptcy Court for the Southern District of New York that it is withdrawing six proofs of claim, filed on Aug. 16, 2006, against certain of Delta Air Lines, Inc.'s affiliates. The IRS asserted unsecured claims for US$792,106,703 each against Comair Holdings, LLC and Comair Services, Inc. Claims for US$1,891,444,502 were filed as unsecured each against Song, LLC DAL Aircraft Trading, Inc., Delta Ventures III, Inc., Delta Loyalty Management Services, LLC, and Comair Services, Inc. In addition, the IRS filed secured claims for US$2,883,912 against each of the Debtor-affiliates. The IRS did not disclose its reason for the Claim withdrawals. About Delta Air Based in Atlanta, Georgia, Delta Air Lines Inc. (NYSE:DAL) -- http://www.delta.com/-- is the world's second-largest airline in terms of passengers carried and the leading U.S. carrier across the Atlantic, offering daily flights to 328 destinations in 56 countries on Delta, Song, Delta Shuttle, the Delta Connection carriers and its worldwide partners. Delta flies to Argentina, Australia and the United Kingdom, among others. The company and 18 affiliates filed for chapter 11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represents the Debtors in their restructuring efforts. Timothy R. Coleman at The Blackstone Group L.P. provides the Debtors with financial advice. Daniel H. Golden, Esq., and Lisa G. Beckerman, Esq., at Akin Gump Strauss Hauer & Feld LLP, provide the Official Committee of Unsecured Creditors with legal advice. John McKenna, Jr., at Houlihan Lokey Howard & Zukin Capital and James S. Feltman at Mesirow Financial Consulting, LLC, serve as the Committee's financial advisors. The Debtors filed a chapter 11 plan of reorganization and disclosure statement explaining that plan on Dec. 19, 2007. On Jan. 19, 2007, they filed revisions to the plan and disclosure statement, and submitted further revisions to the plan on Feb. 2, 2007. On Feb. 7, 2007, the Court approved the Debtors' disclosure statement. In April 25, 2007, the Court confirmed the Debtors' plan. That plan became effective on April 30, 2007. The Court entered a final decree closing 17 cases on Sept. 26, 2007. (Delta Air Lines Bankruptcy News, Issue No. 96; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). * * * As reported in the Troubled Company Reporter on Jan. 17, 2008, Standard and Poor's said that media reports that Delta Air Lines Inc. (B/Positive/--) entered into merger talks with UAL Corp. (B/Stable/--) and Northwest Airlines Corp. (B+/Stable/--) will have no effect on the ratings or outlook on Delta, but that confirmed merger negotiations would result in S&P's placing ratings of Delta and other airlines involved on CreditWatch, most likely with developing or negative implications. DELTA AIR: JPMorgan Chase Holds 15% of Outstanding Common Stock --------------------------------------------------------------- In a Form 13G filed with the Securities and Exchange Commission, JPMorgan Chase & Co., disclosed that in its capacity as a parent holding company, it is deemed to beneficially own an aggregate of 43,838,137 shares of Delta Air Lines, Inc., common stock, representing 15% of Delta's outstanding stock. JPMorgan has sole power to vote on 250,932 shares, the sole power to dispose of 13,838,661 shares, and shared voting and dispositive power each of 496 shares. JPMorgan reports that on May 3, 2007, the Pension Benefit Guaranty Corporation received 49,484,950 shares of the common stock of Delta Air Lines. PBGC has assigned investment discretion and voting authority over this position to J.P. Morgan Investment Management Inc., a wholly owned subsidiary of JPMorgan Chase & Co. "As of Feb. 29[], 2008, the number of shares held by the PBGC is now 43,567,017 and this filing is being made to reflect that decrease," the bank disclosed with the SEC. Roughly 292,217,061 shares of Delta common stock are outstanding as of Jan. 31, 2008. About Delta Air Based in Atlanta, Georgia, Delta Air Lines Inc. (NYSE:DAL) -- http://www.delta.com/-- is the world's second-largest airline in terms of passengers carried and the leading U.S. carrier across the Atlantic, offering daily flights to 328 destinations in 56 countries on Delta, Song, Delta Shuttle, the Delta Connection carriers and its worldwide partners. Delta flies to Argentina, Australia and the United Kingdom, among others. The company and 18 affiliates filed for chapter 11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner, Esq., at Davis Polk & Wardwell, represents the Debtors in their restructuring efforts. Timothy R. Coleman at The Blackstone Group L.P. provides the Debtors with financial advice. Daniel H. Golden, Esq., and Lisa G. Beckerman, Esq., at Akin Gump Strauss Hauer & Feld LLP, provide the Official Committee of Unsecured Creditors with legal advice. John McKenna, Jr., at Houlihan Lokey Howard & Zukin Capital and James S. Feltman at Mesirow Financial Consulting, LLC, serve as the Committee's financial advisors. The Debtors filed a chapter 11 plan of reorganization and disclosure statement explaining that plan on Dec. 19, 2007. On Jan. 19, 2007, they filed revisions to the plan and disclosure statement, and submitted further revisions to the plan on Feb. 2, 2007. On Feb. 7, 2007, the Court approved the Debtors' disclosure statement. In April 25, 2007, the Court confirmed the Debtors' plan. That plan became effective on April 30, 2007. The Court entered a final decree closing 17 cases on Sept. 26, 2007. (Delta Air Lines Bankruptcy News, Issue No. 96; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000). * * * In January 2008, Standard and Poor's said that media reports that Delta Air Lines Inc. (B/Positive/--) entered into merger talks with UAL Corp. (B/Stable/--) and Northwest Airlines Corp. (B+/Stable/--) will have no effect on the ratings or outlook on Delta, but that confirmed merger negotiations would result in S&P's placing ratings of Delta and other airlines involved on CreditWatch, most likely with developing or negative implications. ESTABLECIMIENTO AVICOLA: Trustee Verifies Claims Until July 17 -------------------------------------------------------------- Estudio Castro, Danovara y Asoc., the court-appointed trustee for Establecimiento Avicola La Campesina SA's reorganization proceeding, will be verifying creditors' proofs of claim until July 17, 2008. Estudio Castro will present the validated claims in court as individual reports. The National Commercial Court of First Instance No. 3 in Buenos Aires, with the assistance of Clerk No. 6, 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 Establecimiento Avicola 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 Establecimiento Avicola's accounting and banking records will be submitted in court. La Nacion didn't state the reports submission deadlines. The debtor can be reached at: Establecimiento Avicola La Campesina SA Emilio Castro 7440 Buenos Aires, Argentina The trustee can be reached at: Estudio Castro, Danovara y Asoc. Jeronimo Salguero 2533 Buenos Aires, Argentina GMAC LLC: ResCap Unit Launches Exchange Offer for US$12.8B Notes ---------------------------------------------------------------- Residential Capital LLC commenced offers to exchange any and all of the U.S. dollar equivalent US$12.8 billion outstanding notes of ResCap for newly issued notes, upon the terms and subject to the conditions set forth in its Offering Memorandum and Consent Solicitation Statement dated May 5, 2008, and the related letter of transmittal and consent. The new notes will be issued by ResCap, will be guaranteed by subsidiaries of ResCap and will be secured by a security interest in substantially all of ResCap's existing and after acquired unencumbered assets remaining available to be pledged as collateral. a) For 2008-2009 Notes: CUSIP/ISIN: 76113BAL3 / US76113BAK52 Outstanding Principal Amount: US$398,848,000 Title of Old Notes to be Tendered: Floating Rate Notes due 2008(1) Principal Amount of New Notes to be Issued Tender Prior to Early Delivery Time: US$1,000 Tender After Early Delivery Time: US$970 CUSIP/ISIN: 76113BAK5 / US76113BAK52 Outstanding Principal Amount: US$684,014,000 Title of Old Notes to be Tendered: 8.125% Notes due 2008 (1) Principal Amount of New Notes to be Issued Tender Prior to Early Delivery Time: US$1,000 Tender After Early Delivery Time: US$970 CUSIP/ISIN: 76113BAQ2 / US76113BAQ23 Outstanding Principal Amount: US$714,000,000 Title of Old Notes to be Tendered: Floating Rate Notes due April 2009 (1) Principal Amount of New Notes to be Issued Tender Prior to Early Delivery Time: US$900 Tender After Early Delivery Time: US$870 CUSIP/ISIN: 76114EAB8 / US76114EAB83 Outstanding Principal Amount: US$949,000,000 Title of Old Notes to be Tendered: Floating Rate Notes due May 2009 Principal Amount of New Notes to be Issued Tender Prior to Early Delivery Time: US$900 Tender After Early Delivery Time: US$870 CUSIP/ISIN: 76113BAN9 / US76113BAN91, U76134AD4 / USU76134AD49 Outstanding Principal Amount: US$576,961,000 Title of Old Notes to be Tendered: Floating Rate Subordinated Notes due 2009 (1) Principal Amount of New Notes to be Issued Tender Prior to Early Delivery Time: US$800 Tender After Early Delivery Time: US$770 b) For 2010-2015 Notes: CUSIP/ISIN: 76113BAF6 / US$2,154,500,000, 76113BAC3 / US76113BAC37, U76134AC6 / USU76134AC65 Outstanding Principal Amount: US$2,154,500,000 Title of Old Notes to be Tendered: 8.375% Notes due 2010 (1) Principal Amount of New Notes to be Issued Tender Prior to Early Delivery Time: US$800 Tender After Early Delivery Time: US$770 CUSIP/ISIN: XS0307840735 Outstanding Principal Amount: EUR 542,800,000 Title of Old Notes to be Tendered: Floating Rate Notes due 2010 Principal Amount of New Notes to be Issued Tender Prior to Early Delivery Time: US$800 Tender After Early Delivery Time: US$770 CUSIP/ISIN: 76113BAM1 / US76113BAM19 Outstanding Principal Amount: US$1,243,500,000 Title of Old Notes to be Tendered: 8.000% Notes due 2011 (1) Principal Amount of New Notes to be Issued Tender Prior to Early Delivery Time: US$800 Tender After Early Delivery Time: US$770 CUSIP/ISIN: XS0254758872 Outstanding Principal Amount: EUR 550,000,000 Title of Old Notes to be Tendered: 7.125% Notes due 2012 (1) Principal Amount of New Notes to be Issued Tender Prior to Early Delivery Time: US$800 Tender After Early Delivery Time: US$770 CUSIP/ISIN: 76114EAC6 / US76114EAC66 Outstanding Principal Amount: US$928,500,000 Title of Old Notes to be Tendered: 8.500% Notes due 2012 Principal Amount of New Notes to be Issued Tender Prior to Early Delivery Time: US$800 Tender After Early Delivery Time: US$770 CUSIP/ISIN: 76113BAR0 / US76113BAR06 Outstanding Principal Amount: US$1,604,500,000 Title of Old Notes to be Tendered: 8.500% Notes due 2013 (1) Principal Amount of New Notes to be Issued Tender Prior to Early Delivery Time: US$800 Tender After Early Delivery Time: US$770 CUSIP/ISIN: XS0254759920 Outstanding Principal Amount: GBP 348,920,000 Title of Old Notes to be Tendered: 8.375% Notes due 2013 (1) Principal Amount of New Notes to be Issued Tender Prior to Early Delivery Time: US$800 Tender After Early Delivery Time: US$770 CUSIP/ISIN: XS0307841469 Outstanding Principal Amount: GBP 363,000,000 Title of Old Notes to be Tendered: 9.875% Notes due 2014 Principal Amount of New Notes to be Issued Tender Prior to Early Delivery Time: US$800 Tender After Early Delivery Time: US$770 CUSIP/ISIN: 76113BAE9 / US76113BAE92, U76134AB8 / USU76134AB82 Outstanding Principal Amount: US$486,500,000 Title of Old Notes to be Tendered: 8.875% Notes due 2015 (1) Principal Amount of New Notes to be Issued Tender Prior to Early Delivery Time: US$800 Tender After Early Delivery Time: US$770 (1) Listed on the Luxembourg Stock Exchange. In the exchange offers, ResCap is offering to issue new 8.500% senior secured guaranteed notes due May 15, 2010 in exchange for any and all old notes that mature in 2008 and 2009. In addition, ResCap is offering to issue new 9.625% junior secured guaranteed notes due May 15, 2015 in exchange for any and all old notes that mature in 2010 through 2015. ResCap will mandatorily redeem one-third of the original principal amount of each junior secured guaranteed note on May 15, 2013 and May 15, 2014 with the remaining principal amount paid at maturity. All new notes will be denominated in U.S. dollars. The offer to exchange old notes for new notes is not subject to proration. The senior secured guaranteed notes will be secured on a second lien basis by the collateral for the proposed new US$3.5 billion credit facility. The junior secured guaranteed notes will be secured on a third lien basis by the collateral for that facility. In addition, holders participating in the exchange offers may elect to receive cash in lieu of the new notes that they would otherwise receive, pursuant to a "modified Dutch auction" process described in the offer documents. Each participating holder electing to receive cash pursuant to the auction process, must submit a price denominated in U.S. dollars that specifies the minimum amount of cash such participating holder wishes to receive in lieu of each US$1,000 principal amount of new notes it would otherwise receive for tendered old notes. The indicative offer price specified by a participating holder of old 2008-2009 notes can be no less than US$850 per US$1,000 principal amount of new notes, the indicative offer price specified by a participating holder of old 2010-2015 notes can be no less than US$650 per US$1,000 principal amount of new notes, and in both cases the indicative offer price specified by a participating holder can be no greater than US$1,000 per US$1,000 principal amount of new notes. The amounts of cash that ResCap expects to have available to pay participating holders in lieu of new notes that they would otherwise receive in the exchange offers will be US$700 million with respect to the old 2008-2009 notes and US$500 million with respect to the old 2010-2015 notes. Holders will receive new notes in exchange for old notes submitted but not accepted in the auction process. Only old notes that are tendered in the exchange offers may participate in the auction process. However, old notes may be tendered in the exchange offers without participating in the auction process. ResCap also commenced a cash tender offer for any and all of its outstanding US$1,198,710,000 in aggregate principal amount of floating rate notes due June 9, 2008 at a purchase price of US$1,000 per US$1,000 principal amount upon the terms and subject to the conditions set forth in the offering memorandum and the related letter of transmittal and consent. The total purchase price for each US$1,000 principal amount of June 2008 notes includes an early delivery payment of US$30.00 per US$1,000 principal amount. The CUSIP and ISIN for the June 2008 notes are 76114EAA0 and US76114EAA01. In conjunction with the offers, ResCap is soliciting consents to certain proposed amendments to the indentures under which the old notes were issued. The proposed amendments to the old notes would release the subsidiary guarantees of ResCap's obligations under the old notes and would eliminate certain of the restrictive covenants and events of default currently in the indentures. However, the proposed amendments are not necessary for the issuance of the new notes and the new subsidiary guarantees or for the pledge of collateral for the new notes and subsidiary guarantees. Accordingly, the offers are not conditioned on receipt of the requisite consents to adopt the proposed amendments. Claims with respect to new notes will be effectively senior to claims with respect to unexchanged old notes. In addition, claims with respect to new notes will be effectively senior to claims with respect to unexchanged old notes to the extent of the value of all of the assets of the subsidiary guarantors if the requisite consents from holders of the senior old notes are received. Claims with respect to new notes will be contractually senior to the subordinated old notes. In the offers, ResCap is offering an early delivery payment, which in the case of the June 2008 notes and old notes that are accepted in the auction process, will be paid in cash, and, in the case of all other old notes, will be paid in principal of new notes. The early delivery payment will be paid only to holders who validly tender their old notes, which tender will be deemed to include their consents to the proposed amendments, prior to 5:00 p.m., New York City time, on May 16, 2008, unless extended by ResCap with respect to any or all series of old notes, and do not validly withdraw their tenders. The offers will expire at 11:59 p.m., New York City time, on June 3, 2008, unless extended by ResCap with respect to any or all series of old notes. Tendered old notes may be validly withdrawn at any time prior to 5:00 p.m., New York City time, on May 16, 2008, unless extended by ResCap with respect to any or all series of old notes, but not thereafter. Holders of old notes accepted in the offers will receive a cash payment equal to the accrued and unpaid interest in respect of such old notes from the most recent interest payment date to, but not including, the settlement date. The offers are conditioned on the satisfaction or waiver of certain conditions. In particular, the offers are conditioned on ResCap entering into a new first lien senior secured credit facility, providing for at least US$3.5 billion of commitments on terms acceptable to ResCap. As a result of these conditions, ResCap may not be required to exchange or purchase any of the old notes tendered. The offers are not conditioned on receipt of the requisite consents with respect to the old notes. ResCap is currently in negotiations with GMAC LLC, who would act as the lender under this new first lien senior secured credit facility which, if entered into, will be on terms acceptable to ResCap and GMAC. The new facility would: 1. fund the cash required for the offers, 2. repay ResCap's term loan maturing in July 2008, and 3. replace ResCap's existing US$875.0 million 364-day and US$875.0 million 3-year revolving bank credit facilities. Documents relating to the offers will only be distributed to noteholders who complete and return a letter of eligibility confirming that they are within the category of eligible investors for this private offer. Noteholders who desire a copy of the eligibility letter should contact Global Bondholder Service Corporation, the information agent for the offers, at (866) 470- 3800 (U.S. Toll-free) or (212) 925-1630 (Collect). As reported in the Troubled Company Reporter on April 25, 2008, Residential Funding Company and GMAC Mortgage LLC, both subsidiaries of Residential Capital, LLC, borrowed US$468 million collectively under a Loan and Security Agreement with ResCap's parent, GMAC LLC, as lender, to provide ResCap's subsidiaries with a revolving credit facility with a principal amount of up to US$750 million, providing incremental liquidity for ResCap's operations until longer-term financing is arranged. ResCap and GMAC are investigating various strategic alternatives related to all aspects of ResCap's business, including extensions and replacements of existing secured borrowing facilities, and establishing additional sources of secured funding for ResCap's operations. One potential source of new secured funding is credit secured by certain of ResCap's mortgage servicing rights. The Troubled Company Reporter also reported on April 9, 2008 that GMAC LLC purchased US$1.2 billion of ResCap's notes in open market. The notes have a fair value of approximately US$607,192,000 to ResCap in exchange for 607,192 ResCap Preferred units with a liquidation preference of US$1,000 per unit. ResCap canceled the US$1.2 billion face amount of notes. GMAC may, in its sole discretion, on or before May 31, 2008, contribute up to an additional approximately US$340 million of ResCap notes, having a fair value of approximately US$265,779,000, for additional ResCap Preferred units. The ResCap Preferred ranks senior in right of payment to ResCap's common membership interests with respect to distributions and payments on liquidation, winding-up or dissolution of ResCap. About Residential Capital Headquartered in Minneapolis, Minnesota, Residential Capital LLC -- http://www.rescapholdings.com/-- is the home mortgage unit of GMAC Financial Services, which is in turn wholly owned by GMAC LLC. 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. in 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. The TCR reported on April 25, 2008 that Residential Funding Company and GMAC Mortgage LLC, both subsidiaries of Residential Capital, LLC, borrowed US$468 million collectively under a Loan and Security Agreement with ResCap's parent, GMAC LLC, as lender, to provide ResCap's subsidiaries with a revolving credit facility with a principal amount of up to US$750 million, providing incremental liquidity for ResCap's operations until longer-term financing is arranged. GMAC LLC: Fitch Cuts ID Rating to BB- After ResCap's Poor Fin'l --------------------------------------------------------------- Fitch Ratings has downgraded the long-term Issuer Default Rating of GMAC LLC and related subsidiaries to 'BB-' from 'BB'. Fitch has also downgraded GMAC's unsecured long-term ratings to 'B+' from 'BB-', reflecting the potential for reduced recovery in a default scenario should the company encumber assets. Additionally, Fitch has affirmed the 'B' short-term ratings. The Rating Outlook remains Negative. Approximately US$85 billion of unsecured debt is affected by this action. The downgrade of GMAC's L-T IDR reflects in part continued financial deterioration at ResCap, which has necessitated further financial support from GMAC as part of a debt exchange at ResCap. In addition, given the current capital markets environment, Fitch believes that GMAC may need to encumber assets to enhance its liquidity. To the extent this occurs, it would subordinate current debtholders and reduce recovery prospects in a default scenario. Fitch's Negative Outlook on GMAC continues to reflect the more challenging economic environment that will continue to pressure core operating performance. Given reduced industry sales, GMAC's financing volumes will likely decline unless offset by higher penetration rates. In addition, Fitch expects automotive credit quality to remain pressured throughout 2008 due to rising consumer defaults and higher loss severity upon default. Ratings could be lowered if core profitability (excluding ResCap) weakens coupled with credit quality deterioration beyond historical averages. Fitch has downgraded these ratings with a Negative Outlook: GMAC LLC GMAC International Finance B.V. GMAC Bank GmbH GMAC Canada Ltd. General Motors Acceptance Corp. of Canada Ltd. General Motors Acceptance Corp. of Australia -- Long-term IDR to 'BB-' from 'BB'; -- Senior debt to 'B+' from 'BB'. General Motors Acceptance Corp. (NZ) Ltd. -- Long-term IDR to 'BB-' from 'BB'. Fitch has also affirmed these ratings: GMAC LLC GMAC International Finance B.V. GMAC Bank GmbH General Motors Acceptance of Canada Ltd. General Motors Acceptance Corp. of Australia GMAC Australia (Finance) Ltd. General Motors Acceptance Corp. (U.K.) Plc General Motors Acceptance Corp. (N.Z.) Ltd. GMAC Canada Ltd. -- Short-term IDR 'B'; -- Short-term debt 'B'. GMAC Canada Ltd. -- Short-term IDR 'B'. GMAC LLC: S&P 'B' Rating Unaffected by ResCap's Downgrades ---------------------------------------------------------- Standard & Poor's Ratings Services said that its ratings and negative outlook on GMAC LLC (B/Negative/C) will not be affected by the downgrade of its 100%-owned subsidiary, Residential Capital LLC to 'CC' from 'CCC+'. The ratings actions on Residential Capital LLC follow the company's launch of an exchange offer for unsecured bonds that would pay less than face value to certain Residential Capital LLC bondholders. The exchange illustrates the gravity of the Residential Capital LLC's financial position. Furthermore, the exchange indicates that GMAC LLC's ultimate parents, General Motors Corp. (49% owner of GMAC LLC) and Cerberus (51% owner of GMAC LLC), are pursuing these actions rather than directly provide GMAC LLC with additional capital to downstream to Residential Capital LLC. However, a successful exchange would extend debt maturities, providing needed relief to both Residential Capital LLC in terms of its maturing debt, and GMAC LLC in terms of future support pressures. 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. GUSTAVO DECORACIONES: Claims Verification Deadline Is July 1 ------------------------------------------------------------ Nestor Agustin Iribe, the court-appointed trustee for Gustavo Decoraciones SRL's bankruptcy proceeding, will be verifying creditors' proofs of claim until July 1, 2008. Mr. Iribe will present the validated claims in court as individual reports. The National Commercial Court of First Instance No. 4 in Buenos Aires, with the assistance of Clerk No. 8, 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 Gustavo Decoraciones 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 Gustavo Decoraciones' accounting and banking records will be submitted in court. La Nacion didn't state the submission dates for the reports. Mr. Iribe is also in charge of administering Gustavo Decoraciones' assets under court supervision and will take part in their disposal to the extent established by law. The debtor can be reached at: Gustavo Decoraciones SRL Defensa 1367 Buenos Aires, Argentina The trustee can be reached at: Nestor Agustin Iribe Avenida Corrientes 1250 Buenos Aires, Argentina HERMANOS CAMPAGNA: Proofs of Claim Verification is Until June 19 ---------------------------------------------------------------- Ernesto Daniel Haltman, the court-appointed trustee for Hermanos Campagna S.R.L.'s bankruptcy proceeding, will be verifying creditors' proofs of claim until June 19, 2008. Mr. Haltman 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 Hermanos Campagna 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 Hermanos Campagna's accounting and banking records will be submitted in court. Infobae didn't state the submission dates for the reports. Mr. Haltman is also in charge of administering Hermanos Campagna's assets under court supervision and will take part in their disposal to the extent established by law. The debtor can be reached at: Hermanos Campagna SRL Andonaegui 2838 Buenos Aires, Argentina The trustee can be reached at: Ernesto Daniel Haltman Parana 774 Buenos Aires, Argentina ORVEA SRL: Trustee to Present General Report in Court Tomorrow -------------------------------------------------------------- Estudio Contable de Los Rios & Martino Asociados, the court- appointed trustee for Orvea S.R.L.'s bankruptcy proceeding, will submit a general report containing an audit of the firm's accounting and banking records to the National Commercial Court of First Instance in Salta on May 8, 2008. Estudio Contable verified creditors' proofs of claim until Feb. 8, 2008. The trustee presented the validated claims in court as individual reports on March 24, 2008. Estudio Contable is also in charge of administering Orvea's assets under court supervision and will take part in their disposal to the extent established by law. The debtor can be reached at: Orvea S.R.L. Pellegrini 141, Ciudad de Salta Salta, Argentina The trustee can be reached at: Estudio Contable de Los Rios & Martino Asociados Santa Fe 88, Ciudad de Salta Salta, Argentina PETER PAN: Trustee to Present General Report in Court Tomorrow -------------------------------------------------------------- Guillermo Javier Gimenez, the court-appointed trustee for Peter Pan S.A.'s bankruptcy proceeding, will present a general report containing an audit of the firm's accounting and banking records in the National Commercial Court of First Instance in Buenos Aires on May 8, 2008. Mr. Gimenez verified creditors'proofs of claim until March 7, 2008. He filed the validated claims in court as individual reports on April 9, 2008. Mr. Gimenez is also in charge of administering Peter Pan's assets under court supervision and will take part in their disposal to the extent established by law. The debtor can be reached at: Peter Pan S.A. Pte. Luis Saenz Pena 1756 Buenos Aires, Argentina The trustee can be reached at: Guillermo Javier Gimenez Rodriguez Pena 434 Buenos Aires, Argentina RAYCOL SA: Trustee to File General Report in Court Tomorrow ----------------------------------------------------------- Jorge Basile, the court-appointed trustee for Raycol S.A.'s bankruptcy proceeding, will present in the National Commercial Court of First Instance in Buenos Aires a general report containing an audit of the firm's accounting and banking records on May 8, 2008. Mr. Basile verified creditors' proofs of claim until Feb. 14, 2008. He presented the validated claims in court as individual reports on March 27, 2008. Mr. Basile is also in charge of administering Raycol's assets under court supervision and will take part in their disposal to the extent established by law. The trustee can be reached at: Jorge Basile J. E. Uriburu 782 Buenos Aires, Argentina TARPIN RICARDO: Trustee to File Individual Reports Tomorrow ----------------------------------------------------------- Graciana Carmen Magi, the court-appointed trustee for the bankruptcy proceeding of Tarpin Ricardo Eduardo (extension de quiebra de Construcciones Agropecuarias S.R.L.), will present the validated claims as individual reports in the National Commercial Court of First Instance in Santa Fe on May 8, 2008. Ms. Magi verified creditors' proofs of claim until March 19, 2008. She will submit to court a general report containing an audit of Tarpin Ricardo's accounting and banking records on June 19, 2008. Ms. Magi is also in charge of administering Tarpin Ricardo's assets under court supervision and will take part in their disposal to the extent established by law. The debtor can be reached at: Tarpin Ricardo Eduardo Balcarce 1328, Ciudad de Santa Fe Santa Fe, Argentina The trustee can be reached at: Graciana Carmen Magi Cochabamba 462, Rosario Santa Fe, Argentina TRATO SA: Proofs of Claim Verification Deadline Is June 11 ---------------------------------------------------------- Hector Palma, the court-appointed trustee for Trato SA's bankruptcy proceeding, will be verifying creditors' proofs of claim until June 11, 2008. Mr. Palma will present the validated claims in court as individual reports. The National Commercial Court of First Instance No. 25 in Buenos Aires, with the assistance of Clerk No. 49, 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 Trato 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 Trato's accounting and banking records will be submitted in court. La Nacion didn't state the submission dates for the reports. Mr. Palma is also in charge of administering Trato's assets under court supervision and will take part in their disposal to the extent established by law. The debtor can be reached at: Trato SA Tucuman 1455 Buenos Aires, Argentina The trustee can be reached at: Hector Palma Tte. Gral. Peron 1473 Buenos Aires, Argentina YPF SA: Chubut Awards 2 Gan-Gan Blocks to Firm's Joint Venture -------------------------------------------------------------- Argentina's Chubut province has awarded two exploration blocks in Gan-Gan to YPF SA's joint venture with Wintershall Holding AG. Business News Americas relates that the blocks are called Cuenca Canadon and Cuenca del Golfo San Jorge. They are near the border of Chubut and Rio Negro. YPF SA and Wintershall Holding will invest US$10 million in exploration of the two blocks. Headquartered in Winter Holding AG is a wholly owned subsidiary of the world's largest chemical company, BASF. Its traditional regions of exploration and production are in Germany, North Africa, and in South America. The hydrocarbons producer has recently turned to Russia and the Caspian Sea as new areas of exploration. Wintershall companies also engage in natural gas trading. Wintershall has a 65% stake in WINGAS, a company that operates a natural gas pipeline network in Europe. Headquartered in Buenos Aires, Argentina, YPF S.A. -- http://www.ypf.com.ar/-- is an integrated oil and gas company engaged in the exploration, development and production of oil and gas, natural gas and electricity-generation activities (upstream), the refining, marketing, transportation and distribution of oil and a range of petroleum products, petroleum derivatives, petrochemicals and liquid petroleum gas (downstream). The company is a subsidiary of Repsol YPF, S.A., a Spanish company engaged in oil exploration and refining, which holds 99.04% of its shares. Its international operations are conducted through its subsidiaries, YPF International S.A. and YPF Holdings Inc. * * * As reported in the Troubled Company Reporter-Latin America on March 28, 2008, Standard & Poor's Ratings Services affirmed its 'BB+' local currency corporate credit rating on YPF S.A. and removed it from CreditWatch with negative implications where it was placed Dec. 27, 2007. S&P said the outlook is stable. =========== B E L I Z E =========== INTERPUBLIC GROUP: Net Loss Down to US$62MM in 2008 1st Quarter --------------------------------------------------------------- Interpublic Group of Cos. reported net loss of US$62.8 million compared with a year-earlier net loss of US$125.9 million, Kathy Shwiff and Kevin Kingsbury of The Wall Street Journal reports. According to WSJ, citing a poll by Thomson Reuters, revenue increased 9.3% to US$1.49 billion while organic revenue -- excluding divestitures, acquisitions and foreign-currency translation -- rose 5.1%. Analysts' mean estimates were for a loss of 16 cents a share on revenue of US$1.44 billion, WSJ adds. WSJ notes that Interpublic is in the middle of a turnaround after correcting accounting problems that had dogged it for several years. New York-based, Interpublic Group of Companies Inc. (NYSE: IPG) -- http://www.interpublic.com/-- is one of the world's leading organizations of advertising agencies and marketing services companies. Major global brands include Draftfcb, FutureBrand, GolinHarris International, Initiative, Jack Morton Worldwide, Lowe Worldwide, MAGNA Global, McCann Erickson, Momentum, MRM Worldwide, Octagon, Universal McCann and Weber Shandwick. Leading domestic brands include Campbell-Ewald, Carmichael Lynch, Deutsch, Hill Holliday, Mullen, The Martin Agency and R/GA. The company has operations in Argentina, Brazil, Barbados, Belize, Chile, Colombia, Costa Rica, Dominican Republic, Ecuador, El Salvador, Guatemala, Honduras, Jamaica, Mexico, Nicaragua, Panama, Paraguay, Puerto Rico, Peru, Uruguay and Venezuela. * * * As reported in the Troubled Company Reporter-Latin America on April 10, 2008, Fitch Ratings has upgraded Interpublic Group of Companies' issuer default rating to 'BB+' from 'BB-'. Approximately US$2.1 billion in total debt and US$525 million in preferred stock as of Dec. 31, 2007 is affected. Fitch said the rating outlook is positive. ============= B E R M U D A ============= SEA CONTAINERS: Inks Settlement Deal with General Electric ---------------------------------------------------------- GE SeaCo SRL welcomes a settlement agreement signed by its two parent companies, General Electric Capital Corporation and Sea Containers Ltd. to resolve all of their disputes. The agreement will simplify the GE SeaCo joint venture and end all of the current claims and litigations involving the joint venture and its parents. Sea Containers Ltd. and two of its subsidiaries are currently in Chapter 11 in the U.S. Bankruptcy Court in Delaware. While the Chapter 11 case does not involve GE SeaCo or its own assets, one of SCL's principal assets is its 50 percent holding in the joint venture. Since 2006, GE has designated a majority of members of GE SeaCo's Board of Managers, while SCL continues to designate a minority of the members. The settlement will provide SCL with additional flexibility under the JV structure, which SCL believes will expedite its financial reorganization and consequent emergence from Chapter 11. The entire settlement is subject, among other things, to approval by the U.S. Bankruptcy Court in Delaware. "Simplifying the JV structure will enable us to be even more responsive to our customers needs," David Amble, chairman and acting chief executive officer of GE SeaCo, said. "Despite the differences between GE and SCL, we have built a strong, disciplined business over the last 10 years," Mr. Amble said. "Taking the on-going litigation off the table will enable senior management to continue to build the business." "We are pleased that this agreement and the pending settlement with the SCL pension trustees, which is currently awaiting Court approval, will together enable us to expedite the early filing of a Plan of Reorganization to the Bankruptcy Court and to emerge from Chapter 11," Bob MacKenzie, the chief executive officer of SCL, added. About GE SeaCo GE SeaCo SRL is one of the world's leading container leasing companies, operating a fleet of approximately one million TEU for customers in over 80 countries. The company is driven to achieve its ambition -- to be the most valued leasing company in the world -- valued by its customers, its people, its suppliers and its investors. Formed in 1998 by Sea Containers Ltd. and the General Electric Capital Corporation, GE SeaCo SRL operates as a stand alone business, with headquarters in Barbados, and 13 sales and support offices worldwide. Its UK subsidiary, GE SeaCo Services Ltd., provides administrative and other services to the GE SeaCo SRL group. About Sea Containers Based in Hamilton, Bermuda, Sea Containers Ltd. -- http://www.seacontainers.com/-- provides passenger and freight transport and marine container leasing. Registered in Bermuda, the company has regional operating offices in London, Genoa, New York, Rio de Janeiro, Sydney, and Singapore. The company is owned almost entirely by United States shareholders and its primary listing is on the New York Stock Exchange (SCRA and SCRB) since 1974. On Oct. 3, the company's common shares and senior notes were suspended from trading on the NYSE and NYSE Arca after the company's failure to file its 2005 annual report on Form 10-K and its quarterly reports on Form 10-Q during 2006 with the U.S. Securities and Exchange Commission. Through its GNER subsidiary, Sea Containers Passenger Transport operates Britain's fastest railway, the Great North Eastern Railway, linking England and Scotland. It also conducts ferry operations, serving Finland and Estonia as well as a commuter service between New York and New Jersey in the U.S. Sea Containers Ltd. and two subsidiaries filed for chapter 11 protection on Oct. 15, 2006 (Bankr. D. Del. Case No. 06-11156). Edmon L. Morton, Esq., Edwin J. Harron, Esq., Robert S. Brady, Esq., Sean Matthew Beach, Esq., and Sean T. Greecher, Esq., at Young, Conaway, Stargatt & Taylor, represent the Debtors in their restructuring efforts. The Official Committee of Unsecured Creditors and the Financial Members Sub-Committee of the Official Committee of Unsecured Creditors of Sea Containers Ltd. is represented by William H. Sudell, Jr., Esq., and Thomas F. Driscoll, Esq., at Morris, Nichols, Arsht & Tunnell LLP. Sea Containers Services, Ltd.'s Official Committee of Unsecured Creditors is represented by attorneys at Willkie Farr & Gallagher LLP. In its schedules filed with the Court, Sea Containers disclosed total assets of $62,400,718 and total liabilities of $1,545,384,083. The Debtors were not able to file a Chapter 11 plan of reorganization on April 15, 2008. (Sea Containers Bankruptcy News, Issue No. 40; Bankruptcy Creditors' Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000) ============= B O L I V I A ============= INTERNATIONAL PAPER: Net Income Drops to US$133MM in 1st Quarter ---------------------------------------------------------------- International Paper reported preliminary first-quarter 2008 net earnings of US$133 million compared with net earnings of US$327 million in the 2007 fourth quarter and US$434 million in the first quarter of 2007. Earnings from continuing operations and before special items in the first quarter of 2008 were US$175 million, compared with US$294 million in the 2007 fourth quarter and US$203 million in the first quarter of 2007. Quarterly net sales were US$5.7 billion, down from US$5.8 billion in the fourth quarter and up from US$5.2 billion in the first quarter of 2007. Industry segment operating profits were US$332 million for the 2008 first quarter versus US$566 million in the 2007 fourth quarter and US$403 million in the first quarter of 2007. The quarter-to-quarter decrease reflects higher input costs, lower earnings from land sales and operating performance below expectations early in the quarter. Additionally, the company reported equity earnings, net of taxes, of US$17 million from its 50% investment in Ilim Holding S.A., a separate reportable industry segment in Russia. "We continued to realize price improvement in the first quarter," John Faraci, chairman and CEO, said. "However, those gains were more than offset by sharply increasing input costs, well as the expected quarter-to-quarter decline in earnings from land sales." "We are prepared to work through the weakness of the U.S. economy. Our business outside of North America continues to demonstrate healthy growth and solid pricing," Mr.Faraci said. At March 31, 2008, the company's balance sheet showed total assets of US$24.3 billion, total liabilities of US$15.3 billion and total shareholders' equity of about US$9.0 billion. About International Paper Headquartered in Stamford, Connecticut, International Paper Co. (NYSE: IP) -- http://www.internationalpaper.com/-- is an uncoated paper and packaging company with primary markets and manufacturing operations in North America, Europe, Russia, Latin America, Asia and North Africa. International Paper employs approximately 54,000 people in more than 20 countries, and serves customers worldwide. Its South American operations include, among others, facilities in Argentina, Brazil, Bolivia, and Venezuela. * * * Moody's Investors Service placed International Paper Co.'s senior subordinate rating at 'Ba1' in December 2005. The rating still holds to date with a stable outlook. =========== B R A Z I L =========== ABC BRASIL: Net Profit Increases to BRL38 in First Quarter 2008 --------------------------------------------------------------- Banco ABC Brasil S.A.'s net profit increased over 106% to BRL38.0 million in the first quarter 2008, compared to the same period in 2007. Business News Americas relates that Banco ABC's BRL38.0 million first quarter profit declined 25.0%, from BRL50.7 million in the fourth quarter 2007. According to BNamericas, Banco ABC's return on equity dropped to 13.9% in the first quarter 2008, compared to 16.4% in the first quarter 2007 and 18.6% in the fourth quarter 2007. Banco ABC's shareholder equity rose 141% to BRL1.11 billion in the first quarter this year, from the same period last year. The bank's net interest income grew 60.3% to BRL79.9 million, with lending increasing 80.9% to BRL5.78 billion in the 12 months ended March 2008, compared to the previous period. The report says that Banco ABC's wholesale and large-middle loans dominate its loan book. The loans increased 75.9% to BRL4.97 billion in the 12 months ended March 2008, compared to the previous period. The bank's middle market loans rose 93.2% to BRL661 million and consumer loans grew 446% to BRL151 million in March 2008, from March 2007. Middle-market lending would increase up to 130% this year. BNamerica notes that Banco ABC's retail loans are mostly payroll loans to civil servants and retirement loans go to pensioners in the federal social security system Instituto Nacional do Seguro Social. According to Banco ABC, payroll lending will grow up to 280% in 2008. Banco ABC's overall lending will increase up to 60% in 2008, compared to 2007. Wholesale and large-middle loans will rise up to 50%, BNamericas says, citing Banco ABC's guidance for 2008. Banco ABC's assets increased 38.6% to BRL5.88 billion as of March 2008, compared to March 2007, BNamericas states. Established in 1983 and headquartered in Sao Paulo, Brazil, Banco ABC Brasil SA, controlled by the Arab Banking Corporation and with a branch on the Cayman Islands, is a multiple bank endowed to operate with commercial, investment, financial, housing loan and exchange portfolios. As of December 2007, the bank had total assets of approximately BRL5.67 billion and equity of BRL1.09 billion. * * * As reported in the Troubled Company Reporter-Latin America on April 8, 2008, Moody's Investors Service assigned ratings for long- and short-term foreign currency deposits of Ba2 and Not Prime to Banco ABC Brasil S.A. Moody's said the outlook is stable. ATARI INC: Signs US$11 Mil. Infogrames Entertainment Merger Deal ---------------------------------------------------------------- Atari, Inc., and Infogrames Entertainment S.A. reached a definitive agreement to merge, which: * brings to a close a period of financial underperformance for Atari; * strengthens Atari under Infogrames' new management team; * delivers a platform for future growth in the US; and * offers Atari shareholders an all cash exit. Under the terms of the merger agreement, Infogrames will acquire the remaining outstanding equity interests of Atari (other than shares of common stock held by Infogrames or its affiliates, which would be cancelled) for US$1.68 per share, equivalent to a cash payment of approximately US$11 million. Infogrames is currently the majority shareholder in Atari holding approximately 51.4%. Following the merger, Atari will be a wholly owned subsidiary of Infogrames. The merger will be funded by Infogrames from existing cash resources. The transaction is not subject to any financing conditions and is expected to close in the third calendar quarter of 2008. This agreement is an essential and positive development for Infogrames and its shareholders. It brings Atari fully under the control of Infogrames, delivering a platform for future growth in the U.S. This step closely follows a series of recent major restructuring actions implemented in an effort to reposition Atari, streamline its corporate structure and reduce its annualized costs, including costs related to being a US public company. The Board of Infogrames believes that full ownership of a restructured Atari is an important step for the Group, leading to a simplified operating structure that will deliver greater efficiency, provide the Group with greater opportunities to expand its US distribution capabilities and strengthen its platform for its global online initiatives. "Bringing Atari US and Infogrames businesses together will enable us to create a simplified global structure for our business as we seek to re-build a well-managed, cohesive and financially disciplined company," David Gardner, CEO, Infogrames, said. "This is a key strategic event for Infogrames that will benefit all of our shareholders. I believe that this transaction will generate significant benefits for the Group." The management of Atari, Inc., led by recently appointed President and CEO, Jim Wilson, will join the Group upon the closing of the transaction and remain focused on growing the key North American gaming market. "By joining Infogrames, we will have the opportunity to further transform Atari," Mr. Wilson said. "As part of this newly integrated company, we will be better able to streamline operations and have a stronger platform for growth in North America." The transaction was negotiated and approved by the Special Committee of the Board of Directors of Atari, consisting entirely of directors who are independent of Infogrames. In approving and recommending the merger transaction, the Special Committee considered, among other things, the terms of the merger agreement, which permits the Special Committee to terminate the agreement under certain circumstances, Atari's financial position and results of operations, general market and industry conditions, the risks of implementing Atari's business plan, Atari's limited liquidity and the limited range of options available to Atari. The Special Committee also considered the effects of Infogrames' controlling interest, the risk that the transaction will not be completed, the premium to Atari's share price 30 days prior to the date of Infogrames' offer, and the willingness of Infogrames to extend a loan of up to US$20 million to Atari to cover expected capital requirements. The transaction is subject to a number of customary conditions, including the approval of the holders of a majority of outstanding shares. Atari expects to call a special meeting of shareholders to consider the merger in the third quarter of calendar 2008. Since Infogrames controls a majority of Atari's outstanding shares, Infogrames has the power to approve the transaction without the approval of Atari's other shareholders. In connection with the transaction, Infogrames has committed to lend Atari US$20 million, subject to the terms and conditions of the credit agreement between Atari and Infogrames. This loan will be used to fund Atari's operational cash requirements during the period between the date of the merger agreement and its closing. About Atari Inc. Headquartered in New York, Atari Incorporated, (NASDAQ: ATAR) -- http://www.atari.com/-- publishes and distributes interactive entertainment software in the U.S. The company's 1,000+ published titles distributed by the company include hard-core, genre-defining franchises such as Test Drive(R); and mass-market and children's franchises such Dragon Ball Z(R). Atari Inc. is a majority-owned subsidiary of France- based Infogrames Entertainment SA, an interactive games publisher in Europe. Atari has offices in Brazil, the United Kingdom and Japan. As reported in the Troubled Company Reporter on Feb. 20, 2008, Atari Inc.'s consolidated balance sheet at Dec. 31, 2007, showed US$43.5 million in total assets and US$60.3 million in total liabilities, resulting in a US$16.8 million total stockholders' deficit. Going Concern Doubt New York-based Deloitte & Touche LLP expressed substantial doubt about Atari's ability to continue as a going concern after auditing the company's consolidated financial statements for the year ended March 31, 2007. The auditing firm pointed to the company's significant operating losses. As reported in the Troubled Company Reporter on March 28, 2008, Atari Inc. received a Staff Determination Letter from the Nasdaq Listing Qualifications Department stating that Atari Inc. has not gained compliance with the requirements of Nasdaq Marketplace Rule 4450(b)(3), and that its securities are therefore subject to delisting from The Nasdaq Global Market. On Dec. 21, 2007, the Nasdaq Listing Qualifications Department notified Atari Inc. that, pursuant to Nasdaq Marketplace Rule 4450(e)(1), unless the market value of Atari Inc.'s publicly held shares, which is calculated by reference to Atari Inc.'s total shares outstanding, less any shares held by officers, directors or beneficial owners of 10% or more, maintains an aggregate market value of US$15 million or more for a minimum of 10 consecutive business days prior to March 20, 2008, Atari Inc.'s securities would be subject to delisting. As disclosed on March 21, 2008, the forbearance period granted by BlueBay High Yield Investments (Luxembourg) S.A.R.L., the lender under Atari's senior secured credit facility, has expired and Atari is currently in discussions with BlueBay with respect to, among other things, an extension of the forbearance period. BANCO BRASCAN: Fitch Lifts Ratings After Brookfield Deal Closing ---------------------------------------------------------------- Fitch Ratings has upgraded the ratings of Banco Brascan and removed the bank from Rating Watch Positive, following the regulatory approvals and the effectively closing of the Banco Brascan acquisition from Brookfield Asset Management Inc. on April 29, 2008. Ratings upgraded: -- Long-term foreign and local currency issuer default ratings upgraded to 'BB+' from 'BB-', outlook stable; -- National long-term rating upgraded to 'AA-(bra)' from 'A(bra)', outlook stable; -- National short-term rating upgraded to 'F1+(bra)' from 'F1(bra)'. In addition, Fitch has affirmed these ratings: -- Short-term foreign and local currency IDRs at 'B'; -- Support rating at '3'. The upgrade in Banco Brascan's ratings reflects the support that the bank could receive from Brookfield Asset Management Inc (IDR rated 'BBB+'/Stable Outlook by Fitch). Fitch believes that Brookfield Asset will expand its synergies with the bank, promoting greater development of its local activities. Brazil is a strategic market for Brookfield Asset and the activities developed by the bank are an important complement to the group's Brazilian business. The ratings of Banco Brascan are driven by support and the bank is a small investment institution, commanded out by executives having solid experience, with greater dependency on proprietary treasury gains since 2001, making it more susceptible to market volatility and local economic performance. In 2003, the bank decided not to make provisions for a fine estimated at BRL140 million at December 2007 levied by the Federal Revenue Service. Banco Brascan appealed against the fine and in January 2006, received a favorable decision from the Taxpayers Board of the SRF. Although the SRF can still appeal against this decision, Fitch considers that any potential negative impact should be limited due the shareholder's support. At fiscal year-end 2007, Banco Brascan reported a small loss due to the weak treasury performance throughout the year. The reduction in the bank's capital base in 2007 was part of the transaction that resulted in the departure of Mellon as a shareholder; the balance of this transaction, settled mainly by the sale of the bank's holding company's shares in the IPO of the BMF and Bovespa (Brazilian commodities and stock exchanges, respectively), which netted BRL367 million. Notwithstanding the smaller capital base, the bank's regulatory capital ratio reached 23% at December 2007, remaining in line with its peers' and providing room for leveraging. Brascan and its affiliates are majority controlled by the Mellon Brookfield groups, focusing its operations on treasury, financial consulting services and structuring business in the local capital markets. In December 2007, the bank presented BRL1,263.5 million of assets and equity of BRL189.8 million. BANCO DAYCOVAL: Joins Brasil Index of Bovespa Stock Exchange ------------------------------------------------------------ Noticias Financieras reports that Banco Daycoval S.A.'s shares have joined the Brasil Index of the Bovespa stock exchange. Noticias Financieras relates that Brasil Index "measures return on a portfolio comprised of Bovespa's 100 most liquid shares." Banco Daycoval's "paper DAYC4 will have a 0.086% weight" in the Brasil Index, Noticias Financieras states. Headquartered in Sao Paulo, Brazil, Banco Daycoval started its activities in 1968, with the creation of Daycoval DTVM and Valco Corretora de Valores. Brothers Ibrahim and Sasson Dayan control the bank. It is the core business of its shareholders and specializes in financing small- and medium-sized companies, backed by receivables. It also operates with consignment lending for payroll deduction and consumer financing. Since June 2007, the bank has had 29% of its shares traded at Bovespa on the New Brazilian Stock Market. These shares enjoy a tag- along privilege, giving minority shareholders 100% of the value of the block of controlling shares in the event of the sale of the institution. * * * As reported in the Troubled Company Reporter-Latin America on Nov. 27, 2007, Fitch Ratings placed Banco Daycoval S.A.'s Long- term foreign currency issuer default rating at 'BB-' and Long- term local currency issuer default rating at 'BB-' with a stable outlook. BANCO NACIONAL: May Turn to Int'l Capital Markets to Raise Funds ---------------------------------------------------------------- Banco Nacional de Desenvolvimento Economico e Social a.k.a. BNDES could turn to international capital markets to raise funds after Standard & Poor's raised Brazil's long-term foreign currency rating to investment grade BBB- with a stable outlook. However, Banco Nacional's Fixed-Income Investments Chief Carlos Lagrota assured news daily Folha de S Paulo that the bank would continue to concentrate on the domestic capital market. Banco Nacional authorized BRL16.5 billion in new loans in the first quarter 2008, 47% greater than the same period in 2007. It budgeted BRL80 billion for lending in 2008, 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. * * * In August 2007, Moody's Investors Service assigned a Ba2 foreign long-term bank deposit rating on Banco Nacional de Desenvolvimento Economico e Social. BLOUNT INT'L: Acquires Carlton Holdings for US$63,000,000 --------------------------------------------------------- Blount International Inc. acquired all the capital stock of Carlton Holdings Inc. from its private shareholders. Blount paid approximately US$63 million in net consideration for the stock, funded through the company's revolving credit facility. "The acquisition of Carlton is consistent with our intention to invest in and grow our core business, the Outdoor Products segment," James Osterman, Blount's chairman and CEO, said. "The added capacity and potential operating synergies of the combined entities make Carlton an attractive asset to own. "Carlton's strengths in international markets where over 80% of their sales take place, fits well with our expansion plans and the additional capacity will accelerate the opportunities to take advantage of the weakened U.S. dollar in trading," Mr. Osterman added. About Carlton Holdings Inc. Located in Milwaukie, Oregon, Carlton Holdings Inc. is a manufacturer of saw chain. Carlton employs approximately 400 employees, most at its Oregon manufacturing facility, and distributes the majority of its products to international markets. The company was founded in 1963. About Blount International Blount International Inc. (NYSE: BLT) -- http://www.blount.com/ -- is a diversified international company operating in two principal business segments: Outdoor Products and Industrial and Power Equipment. The company's Outdoor Products segment provides chain, bars and sprockets to the chainsaw industry, accessories to the lawn care industry and concrete cutting saws. Blount manufactures its products in the United States, Canada, China, and Brazil, and sells them in more than 100 countries. Blount International Inc.'s balance sheet at Dec. 31, 2007, showed total assets of US$411.9 million and total liabilities of US$466.0 million, resulting in a total shareholders' deficit of US$54.1 million. BRASIL TELECOM: Launches 3G Services ------------------------------------ Brasil Telecom S.A. has launched 3G services called 3GMais in Brazil. Business News Americas relates that Brasil Telecom produced five packages combining its services to encourage its current clients and entice new customers. The new service includes: -- a flat fee rate with unlimited video calls, -- 1GB mobile broadband, -- 1,000 SMS, -- 5,000 minutes of voice calls, and -- a handset for BRL199.90 a month. Headquartered in Brasilia, Brasil Telecom S.A. -- http://www.brasiltelecom.com.br-- is an integrated telecommunic