/raid1/www/Hosts/bankrupt/TCRLA_Public/081203.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
L A T I N A M E R I C A
Wednesday, December 3, 2008, Vol. 9, No. 240
Headlines
A R G E N T I N A
ACE SEGUROS: Moody's Holds Ba3 Rating; Outlook Stable
ALDEL SA: Trustee Verifying Proofs of Claim Until December 29
ALTERNATIVA PARA: Trustee Verifying Proofs of Claim Until March 13
CAJA DE SEGUROS: Moody's Keeps 'Ba3' Global Currency Rating
CONFECCIONES PICO: Trustee Verifying Proofs of Claim Until April 1
DOMINICO SRL: Trustee Verifying Proofs of Claim Until Dec. 15
GENERALI CORPORATE: Moody's Affirms 'B1' Global Currency Rating
METALURGICA R D: Proofs of Claim Verification Due on February 18
PEYCA SA: Trustee Verifying Proofs of Claim Until Feb. 25
SAINVILLE SA: Trustee Verifying Proofs of Claim Until Feb. 25
SERVICIOS INTEGRALES: Proofs of Claim Due on March 12
B E R M U D A
220 PLUS: Creditors' Proofs of Debt Due on December 10
220 PLUS: Members' Final Meeting Set for December 30
FORD MOTOR: To Cut CEO's Pay Package & Focus on Making Small Cars
FREMONT REINSURANCE: Court to Hear Wind-Up Petition on December 12
GENERAL MOTORS: More Cuts Needed to Win Gov't Loan, Says Conway
MAN-IP 220: Creditors' Proofs of Debt Due on December 10
MAN-IP 220: Members' Final Meeting Set for December 30
MAN-IP DIVERSIFIED: Creditors' Proofs of Debt Due on December 10
MAN-IP DIVERSIFIED: Members' Final Meeting Set for December 30
MAN-IP DIVERSIFIED: Creditors' Proofs of Debt Due on December 10
MAN-IP DIVERSIFIED: Members' Final Meeting Set for December 30
TRADING 220: Creditors' Proofs of Debt Due on December 10
TRADING 220: Members' Final Meeting Set for December 30
TRADING 220: Creditors' Proofs of Debt Due on December 10
TRADING 220: Members' Final Meeting Set for December 30
VANGUARD INSURANCE: Court to Hear Wind-Up Petition on December 12
B R A Z I L
DELPHI CORP: Court Allows Reargument of Fraud Claim Order
DELPHI CORP: Court Gives Go Signal for Auction of Exhaust Business
DELPHI CORP: Delays Hearing on Bankruptcy Exit Plan to Dec. 17
DELPHI CORP: Gets Six Months Extension of US$4.35-Bil. DIP Loan
DELPHI CORP: Tranche C Lenders, et al., Balk at DIP Loan Extension
UNIBANCO: Presentation to Investors Scheduled on Dec. 9
PETROLEO BRASILEIRO: Bovespa Index May Raise Company's Weight
* BRAZIL: May Tap BRL15BB Sovereign Fund to Fuel Economic Growth
C A Y M A N I S L A N D S
AERCAP 320: Creditors' Proofs of Debt Due on December 11
AERCAP 320: Final General Meeting Set for December 15
AERCAP 320 C: Creditors' Proofs of Debt Due on Dec. 11
AERCAP 320 C: Final Meeting Slated for December 15
AIR TARA: Creditors' Proofs of Debt Due on December 11
AIR TARA: Final General Meeting Set for December 15
CARDIFF LTD: Shareholders' Meeting Set for December 15
EEGO FUND: Placed Under Voluntary Liquidation
ELASIS (CAYMAN ISLANDS): Creditors' Proofs of Debt Due on Dec. 11
ELASIS (CAYMAN ISLANDS): Final Meeting Slated for December 15
GENNAKER I: Moody's Junks Ratings on Classes C & D Notes
G SQUARE: S&P Junks Ratings on Class A Sr. Floating-Rate Notes
O'CONNOR PROPRIETARY: Shareholders' Final Meeting Set for Dec. 11
O'CONNOR PROPRIETARY: Shareholders' Final Meeting Set for Dec. 11
O'CONNOR VOLATILITY: Shareholders' Meeting Set for December 11
O'CONNOR VOLATILITY: Shareholders' Meeting Set for December 11
SCHRADER CAMARGO: Members' Meeting Set for December 12
C O L O M B I A
BANCOLOMBIA: Sells 67.42% Real Estate Stake for US$ 9.72 Million
EMPRESA DE ENERGIA: Fitch Confirms Issuer Default Rating at 'BB'
TRANSPORTADORA DE GAS: Fitch Confirms Issuer Default Ratings at BB
D O M I N C A N R E P U B L I C
* DOMINICAN REPUBLIC: Business Groups Warn Massive Layoff in 2009
* DOMINICAN REP: Gov't to Inject Dollars to Lower Market Pressure
G U A T E M A L A
EMPRESA ELECTRICA: S&P Holds 'BB-' Long-Term Corp. Credit Ratings
J A M A I C A
JAMAICA PRODUCERS: Cuts 200 Jobs in UK Unit Due to Losses
* JAMAICA: Revenue Collection Declines
* JAMAICA: Signs US$500 Mil. Deal with IDB to Support Local Banks
M E X I C O
PILGRIM'S PRIDE: Files for Chapter 11 Bankruptcy in Texas
PILGRIM'S PRIDE: Lines Up US$450MM. DIP Loan from Bank of Montreal
PILGRIM'S PRIDE: Case Summary & 50 Largest Unsecured Creditors
V E N E Z U E L A
PDVSA: Ecuador President Says Venezuela Committed to Refinery
X X X X X X X X
* Detroit Three In Talks With Union to Stop Idled Worker Payment
- - - - -
=================
A R G E N T I N A
=================
ACE SEGUROS: Moody's Holds Ba3 Rating; Outlook Stable
-----------------------------------------------------
Moody's has affirmed ACE Seguros S.A.'s Ba3 global local currency
and Aa2.ar national scale insurance financial strength ratings.
The outlook for the ratings remains stable.
According to Moody's, ACE Seguros' ratings reflect primarily the
company's high-quality investment portfolio, with relatively
little exposure to Argentine government bonds, and its good
product risk. The affiliation of ACE Seguros with ACE Limited
(NYSE: ACE; senior unsecured debt A3) is also a positive credit
consideration, as the company benefits both from its ultimate
parent's implicit support and oversight of the local operation, as
well as from the explicit support provided by its affiliates
(namely ACE Tempest Reinsurance Ltd.: Aa3 IFS) in the form of risk
transfer arrangements. Moody's added that notwithstanding ACE
Seguros' relatively low penetration in the local insurance market,
the company has leading positions in its main segments of
operations, particularly personal accident (with just over 10%
market share), general liability, and property insurance.
These fundamental credit strengths are offset primarily by ACE
Seguros' increased earnings volatility and its recent decline in
capitalization. The company's historically high dividend payments
to its parent company has, to some extent, weakened its capital
adequacy, which should likely be pressured further as a result of
the increased transfer of premiums and profits to its affiliates.
Moody's added that Argentina's high sovereign risk and poor
operating environment are also major limitations to ACE Seguros'
credit profile.
The rating agency noted that ACE Seguros' ratings could be
upgraded should the company sustain its core earnings, with return
on equity above 15% coupled with combined ratios below 100%, and
maintain its gross underwriting leverage below 5x shareholders'
equity. A significant improvement in Argentina's sovereign
operating environment, as well as the upgrade of ACE Ltd.'s
ratings could also contribute to an upgrade of ACE Seguros'
ratings.
Conversely, these factors could result in a ratings downgrade for
ACE Seguros: a) sustained return on equity below 5%; b) gross
underwriting leverage above 9x shareholder's equity; c)
deterioration of the credit quality of its investment portfolio;
or d) reduced support from its ultimate parent company and
affiliates.
Headquartered in Buenos Aires, Argentina, ACE Seguros is an
indirect wholly-owned subsidiary of ACE Limited. As of June 30,
2008, ACE Seguros' total assets amounted to ARS137.2 million and
its shareholders' equity to ARS42.2 million. For the 2008 fiscal
year, ended on June 30, the company reported ARS 209.2million in
gross written premiums and a net loss of ARS1.8 million.
ALDEL SA: Trustee Verifying Proofs of Claim Until December 29
-------------------------------------------------------------
The court-appointed trustee for Aldel S.A.'s bankruptcy
proceedings will be verifying creditors' proofs of claim until
December 29, 2008.
The trustee will present the validated claims in court as
individual reports on March 12, 2009. 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
the company and its creditors.
Inadmissible claims may be subject to appeal in a separate
proceeding known as an appeal for reversal.
A general report that contains an audit of the company's
accounting and banking records will be submitted in court on
April 29, 2009.
ALTERNATIVA PARA: Trustee Verifying Proofs of Claim Until March 13
------------------------------------------------------------------
The court-appointed trustee for Alternativa Para La Empresa
S.R.L.'s bankruptcy proceedings will be verifying creditors'
proofs of claim until March 13, 2009.
The trustee will present the validated claims in court as
individual reports on May 8, 2009. 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 the
company and its creditors.
Inadmissible claims may be subject to appeal in a separate
proceeding known as an appeal for reversal.
A general report that contains an audit of the company's
accounting and banking records will be submitted in court on
June 30, 2009.
CAJA DE SEGUROS: Moody's Keeps 'Ba3' Global Currency Rating
-----------------------------------------------------------
Moody's Latin America affirmed Caja de Seguros S.A.'s Ba3 global
local-currency and Aa2.ar Argentine national scale insurance
financial strength ratings. The outlook for the ratings remains
stable.
Caja de Seguros is a major Argentine insurer that distributes
property and casualty and life insurance coverage to individuals
and to small and medium-size enterprises, mainly through its own
network of nationwide branches. The company is jointly owned by
Assicurazioni Generali and by Los W, a holding controlled by a
local family.
According to the rating agency, Caja de Seguros' ratings primarily
reflect its strong market position and good product risk and
diversification. The company also benefits from being part of and
integrated with the large and diversified "Caja Group" in
Argentina, which has operations in general insurance, annuities,
and workers compensation. Finally, the affiliation of Caja de
Seguros with Assicurazioni Generali, rated Aa3 for IFS, is also a
positive credit consideration, as the company benefits both from
its majority-owner's implicit support and oversight of the local
operation.
These fundamental credit strengths are offset primarily by Caja de
Seguros' weak and volatile profitability, its poor quality
investment portfolio, and its weak capital position. The
company's high dividend payments to its holding company have
further weakened its capital adequacy, which had only an 8%
surplus above regulatory requirements as of June 30, 2008.
Moody's added that Argentina's high sovereign risk and poor
operating environment are also major limitations to Caja de
Seguros' credit profile.
Based in Buenos Aires, Argentina, Caja de Seguros reported a net
profit of Ar$ 4.6 million during the fiscal year ended June 30
2008, which is down relative to the prior year. This decline in
net income was primarily driven by higher underwriting losses and
a large income tax charge. Total reported assets amounted to
Ar$ 1.27 billion, and shareholders' equity was Ar$ 290 million at
June 30, 2008.
NOTE: Moody's national scale insurance financial strength ratings
rank an enterprise's financial strength on a relative basis in
comparison with other firms within the same country. Such ratings
are designed for use at the local (national) level, and they are
not globally comparable. For Argentine companies, national scale
ratings carry the identifier of ".ar".
In contrast, global local-currency insurance-financial strength
ratings indicate the relative credit risk of an insurance company
on a globally comparable scale. In the case of ratings of
insurers domiciled in a country with a speculative grade sovereign
rating, such as Argentina, these ratings are the result of, among
several factors, the political risk, the risk of a generalized
debt moratorium, the weakness of the legal environment or
framework, and the risk of interference in the functioning of the
financial system. Taken together, the national scale and global
local-currency ratings provide a more comprehensive opinion about
the credit risk of the company. Moody's insurance financial
strength ratings are opinions about the ability of insurance
companies to punctually pay senior policyholder claims and
obligations.
CONFECCIONES PICO: Trustee Verifying Proofs of Claim Until April 1
------------------------------------------------------------------
The court-appointed trustee for Confecciones Pico S.R.L.'s
bankruptcy proceedings will be verifying creditors' proofs of
claim until April 1, 2009.
The trustee will present the validated claims in court as
individual reports on May 5, 2009. 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 the
company and its creditors.
Inadmissible claims may be subject to appeal in a separate
proceeding known as an appeal for reversal.
A general report that contains an audit of the company's
accounting and banking records will be submitted in court on
June 18, 2009.
DOMINICO SRL: Trustee Verifying Proofs of Claim Until Dec. 15
-------------------------------------------------------------
The court-appointed trustee for Dominico S.R.L.'s bankruptcy
proceedings will be verifying creditors' proofs of claim until
Dec. 15, 2008.
The trustee will present the validated claims in court as
individual reports on March 3, 2009. 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
the company and its creditors.
Inadmissible claims may be subject to appeal in a separate
proceeding known as an appeal for reversal.
A general report that contains an audit of the company's
accounting and banking records will be submitted in court on
April 20, 2009.
GENERALI CORPORATE: Moody's Affirms 'B1' Global Currency Rating
---------------------------------------------------------------
Moody's Latin America affirmed Generali Corporate Compania
Argentina de Segueros S.A.'s B1 global local-currency and Aa3.ar
Argentine national scale insurance financial strength ratings.
The outlook for the ratings remains stable.
Generali Corporate is a relatively small, but growing, insurance
company that distributes general insurance and life products to
middle-corporate and retail customers in Argentina. In addition,
the company is one of the leading players in the corporate
segment. The company is wholly owned by Assicurazioni Generali
(rated Aa3 for IFS).
According to the rating agency, Generali Corporate's ratings
primarily reflect the company's adequate product risk and
diversification, and its affiliation with its ultimate parent,
Assicurazioni Generali, as it benefits from implicit support and
oversight of the local operation, as well as from the explicit
support provided by risk transfer reinsurance arrangements with
affiliates. Despite the company's relatively small business
volume, its focus on commercial and corporate lines places
Generali Corporate among the top 10 insurers in the specialized
Fire and Allied Perils line, holding a 3% market share (based on
gross premiums) in that segment.
In addition to its ownership of Generali Corporate, Assicurazioni
Generali maintains a significant presence in the Argentine
insurance market through its majority-ownership of La Caja Group,
which provides coverage to retail and corporate customers for
general insurance, annuities, and workers compensation.
Offsetting these positive factors, however, is Generali
Corporate's weak capital position (gross underwriting leverage
increased to 17x as of June 30, 2008), significant investment
risk, relatively weak market position, and volatile profitability.
Moody's added that Argentina's high sovereign risk and poor
operating environment are also major limitations to Generali
Corporate's credit profile.
Based in Buenos Aires, Argentina, Generali Corporate reported a
net loss of Ar$ 3.5 million during the fiscal year ended June 30
2008, compared with a net profit of Ar$ 4.9 million in the
previous year. This decline in net income was primarily caused by
an increase in underwriting losses and lower investment income.
Total reported assets amounted to Ar$ 78 million and shareholders'
equity was Ar$ 14.3 million at June 30, 2008.
METALURGICA R D: Proofs of Claim Verification Due on February 18
----------------------------------------------------------------
Andrea Sita, the court-appointed trustee for North TEL SA's
bankruptcy proceedings, will be verifying creditors' proofs of
claim until Feb. 18, 2009.
Ms. Sita will present the validated claims in court as individual
reports. The National Commercial Court of First Instance No. 1 in
Buenos Aires, with the assistance of Clerk No. 2, will determine
if the verified claims are admissible, taking into account the
trustee's opinion, and the objections and challenges that will be
raised by the company and its creditors.
The Debtor can be reached at:
Metalurgica R. D. SA
Bernardo de Irigoyen 308
Buenos Aires, Argentina
The trustee can be reached at:
Andrea Sita
Hipolito Yrigoyen 4027
Buenos Aires, Argentina
PEYCA SA: Trustee Verifying Proofs of Claim Until Feb. 25
---------------------------------------------------------
The court-appointed trustee for Peyca S.A.'s bankruptcy
proceedings will be verifying creditors' proofs of claim until
Feb. 25, 2009.
The trustee will present the validated claims in court as
individual reports on April 14, 2009. 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
the company and its creditors.
Inadmissible claims may be subject to appeal in a separate
proceeding known as an appeal for reversal.
A general report that contains an audit of the company's
accounting and banking records will be submitted in court on
May 28, 2009.
SAINVILLE SA: Trustee Verifying Proofs of Claim Until Feb. 25
-------------------------------------------------------------
The court-appointed trustee for Sainville S.A.'s bankruptcy
proceedings will be verifying creditors' proofs of claim until
Feb. 25, 2009.
The trustee will present the validated claims in court as
individual reports on April 8, 2009. 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
the company and its creditors.
Inadmissible claims may be subject to appeal in a separate
proceeding known as an appeal for reversal.
A general report that contains an audit of the company's
accounting and banking records will be submitted in court on
May 27, 2009.
SERVICIOS INTEGRALES: Proofs of Claim Due on March 12
-----------------------------------------------------
The court-appointed trustee for Servicios Integrales La Juanita
S.R.L.'s bankruptcy proceedings will be verifying creditors'
proofs of claim until March 12, 2009.
The trustee will present the validated claims in court as
individual reports on April 23, 2009. 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
the company and its creditors.
Inadmissible claims may be subject to appeal in a separate
proceeding known as an appeal for reversal.
A general report that contains an audit of the company's
accounting and banking records will be submitted in court on
June 8, 2009.
=============
B E R M U D A
=============
220 PLUS: Creditors' Proofs of Debt Due on December 10
------------------------------------------------------
The creditors of 220 Plus (Series RF) Trading Ltd are required to
file their proofs of debt by December 10, 2008, to be included in
the company's dividend distribution.
The company commenced liquidation proceedings on Nov. 24, 2008.
The company's liquidator is:
Beverly Mathias
c/o Argonaut Limited
Argonaut House, 5 Park Road
Hamilton HM O9, Bermuda
220 PLUS: Members' Final Meeting Set for December 30
----------------------------------------------------
The members of 220 Plus (Series RF) Trading Ltd will hold their
final general meeting on December 30, 2008, at 9:30 a.m., to hear
the liquidator's report on the company's wind-up proceedings and
property disposal.
The company commenced liquidation proceedings on Nov. 24, 2008.
The company's liquidator is:
Beverly Mathias
c/o Argonaut Limited
Argonaut House, 5 Park Road
Hamilton HM O9, Bermuda
FORD MOTOR: To Cut CEO's Pay Package & Focus on Making Small Cars
-----------------------------------------------------------------
Ford Motor Co. will present before the congress its business plan,
which includes a reduction in CEO Alan Mulally's compensation
package, Mike Spector, Mathew Dolan, and Greg Hitt at The Wall
Street Journal report, citing a person familiar with the matter.
According to WSJ, Ford Motor and General Motors Corp. directors
met separately on Monday to vote on their viability plans to be
presented to the Congress on Tuesday, to try to win support for
$25 billion in low-cost loans from the federal government.
Chrysler LLC top executives, WSJ relates, were finalizing their
own plan to show that it can survive and return to profitability
with government aid, after its private-equity owner Cerberus
Capital Management LP reviewed the plan on Monday.
Citing a source, WSJ states that it isn't yet clear how Mr.
Mulally's pay package will be reduced, but Ford Motor is
considering cutting off Mr. Mulally's salary until the firm
becomes profitable again, or paying him through stock options.
According to the report, Mr. Mulally has earned almost
US$50 million in total compensation since leading Ford Motor in
2006.
WSJ reports that executive compensation became an issue when the
Ford Motor, GM, and Chrysler asked the Congress for financial help
in November 2008. Mr. Mulally, says WSJ, had been unwilling to
accept aUS$1 yearly salary when he was asked during the first
meeting of the Congress, and people familiar with the matter said
that Ford Motor Executive Chairperson William Clay Ford and some
other members of the company's board were unnerved by Mr. Mulally.
Ford Motor to Focus on Small Cars
Citing a person familiar with the matter, WSJ relates that Ford
Motor will also mention in its business plan that it will shift to
making small fuel-efficient cars and break from the past strategy
of focusing mainly on large pick up trucks and sport-utility
vehicles. According to the report, Ford Motor's plan would likely
underscore its new fuel-efficient gasoline turbocharged direct-
injection engines and bringing its high-mileage cars from its
European operations to the U.S.
Conway MacKenzie Says More Cuts Must be Implemented
GM, Ford Motor, and Chrysler must implement more cuts, WSJ
reports, citing restructuring firm Conway MacKenzie & Dunleavy
senior managing director Van Conway. "I think you need to
demonstrate sincerely that you are doing the very painful cuts --
white collar, blue collar, plant closings. They need to really
look like they're suffering on the expense line so people believe
they can make it," the report quoted Mr. Conway as saying.
According to WSJ, a source said that Ford Motor and GM would be
willing to seek further cost-cuts and concessions from the United
Auto Workers union. The report says that once GM reaches an
agreement with the United Auto Workers union on any wage or
benefit concessions for a rescue of the company, Chrysler, Ford
Motor will also insist on a similar arrangement. GM, according to
the report, owes the health care trust for retiree union workers
someUS$7.5 billion by 2010, which many suspect the company can't
afford.
Citing a source, WSJ says that UAW President Ron Gettelfinger is
open to eliminating the jobs bank, which pays employees most of
their wages even when they no longer work in plants, but Mr.
Gettelfinger wants to see management sacrifices in return. The
sacrifices, WSJ relates, would include limits on executive
compensation and a retraining program that will help laid-off
workers get high-tech jobs in areas like battery development for
electric vehicles.
WSJ relates that sources said that GM will plan more cuts to North
American production capacity, an initiative to offer debt-holders
equity to tidy its balance sheet, and cuts to executive pay, while
aspects of the plan include goals to gain more labor concessions,
and executive pay cuts. Citing a source, the report states that
GM would also include in its plan cutting brands and details on
new fuel-efficient vehicles and how the firm will meet new
stringent federal mileage rules. The report says that GM hopes to
start selling electric plug-in car Chevrolet Volt in 2010.
Cerberus Capital is also interested in combining Chrysler with
another firm, WSJ states. Cerberus Capital had discussed selling
Chrysler to GM before the request for government aid, according to
the report.
Jeff Bennett at WSJ reports that Ford Motor is again considering
selling its Swedish luxury vehicle maker Volvo Cars, saying on
Monday that it will re-evaluate strategic options for the unit as
part of a broader effort to strengthen Ford Motor's balance sheet.
Ford Motor, according to WSJ, acquired Volvo Cars from Swedish
truck maker AB Volvo for more thanUS$6.5 billion in 1999.
The review could take several months, during which time Volvo Cars
will continue implementing a restructuring, which includes laying
off a quarter of its workforce, states WSJ. Mr. Mulally had
affirmed in November this year his decision in 2007 to keep Volvo
Cars after a review of the advantages of selling the unit that
year, according to the report. Mr. Mulally said last month that
he was still committed to restoring Volvo Cars' financial health,
the report states.
According to WSJ, CSM Worldwide analyst Michael Robinet doubts
that Ford Motor will be able to quickly find a suitor. The report
quoted Mr. Robinet as saying, "Anyone who purchases Volvo would
have to have very close ties to Ford because virtually every Volvo
is using a Ford platform. It will be difficult because it's not
like cutting a piece of pie that's already perforated and just
cracking it off. They are very integrated and it could take
years."
AB Volvo said on Monday that it wasn't interested in purchasing
back Volvo Cars from Ford Motor, WSJ reports.
WSJ relates that GM, Ford Motor, and Chrysler were also devising
alternative travel plans after the Congress criticized their CEOs
for using expensive corporate jets to make their way to Capitol
Hill. Ford Motor said on Monday that Mr. Mulally will drive by
car to Washington this time, while Chrysler said that its CEO
Robert Louis Nardelli has ruled out flying by private jet,
according to the report.
WSJ states that if the Congress approves the requests of GM, Ford
Motor, and Chrysler for government financial assistance, the
lawmakers would be called back to Washington next week.
Jeff Green and John Lippert at Bloomberg News report that GM, Ford
Motor, and Chrysler union leaders will hold an emergency meeting
on Dec. 3 at the Detroit Marriott Hotel. Citing a person familiar
with the matter, the report says that participants of the meeting
will be asked to reopen a 2007 labor agreement to consider
concessions.
Sources said that GM also wants to change how it pays for a union
retiree health care fund as part of a broader cost cutting plan
designed to win government aid, Bloomberg states.
About Ford Motor Co.
Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) --
http://www.ford.com/-- manufactures or distributes automobiles in
200 markets across six continents. With about 260,000 employees
and about 100 plants worldwide, the company's core and affiliated
automotive brands include Ford, Jaguar, Land Rover, Lincoln,
Mercury, Volvo, Aston Martin, and Mazda. The company provides
financial services through Ford Motor Credit Company.
The company has operations in Japan in the Asia Pacific region. In
Europe, the company maintains a presence in Sweden, and the United
Kingdom. The company also distributes its brands in various
Latin-American regions, including Argentina and Brazil.
* * *
As reported in the Troubled Company Reporter on Nov. 11,
2008, Moody's Investors Service lowered the debt ratings of
Ford Motor Company, Corporate Family and Probability of
Default Ratings to Caa1 from B3. The company's Speculative
Grade Liquidity rating remains at SGL-3 and the rating outlook
is negative. In a related action Moody's also lowered the
long-term rating of Ford Motor Credit Company to B3 from B2.
The outlook for Ford Credit is negative.
As reported in the Troubled Company Reporter on Oct. 10, 2008,
Fitch Ratings downgraded the Issuer Default Rating of Ford Motor
Company and Ford Motor Credit Company by one notch to 'CCC' from
'B-'.
FREMONT REINSURANCE: Court to Hear Wind-Up Petition on December 12
------------------------------------------------------------------
A petition to have Fremont Reinsurance Co. Ltd.'s operations wound
up will be heard before the Supreme Court of Bermuda on Dec. 12,
2008, at 9:30 a.m.
The Bermuda Monetary Authority filed the petition against the
company on November 19, 2008.
GENERAL MOTORS: More Cuts Needed to Win Gov't Loan, Says Conway
---------------------------------------------------------------
General Motors Corp., Ford Motor Co., and Chrysler LLC must
implement more cuts, The Wall Street Journal reports, citing
restructuring firm Conway MacKenzie & Dunleavy senior managing
director Van Conway.
"I think you need to demonstrate sincerely that you are doing the
very painful cuts -- white collar, blue collar, plant closings.
They need to really look like they're suffering on the expense
line so people believe they can make it," WSJ quoted Mr. Conway as
saying.
According to WSJ, Ford Motor and GM directors met separately on
Monday to vote on their viability plans to be presented to the
Congress on Tuesday, to try to win support for US$25 billion in
low-
cost loans from the federal government. Chrysler LLC top
executives, WSJ relates, were finalizing their own plan to show
that it can survive and return to profitability with government
aid, after its private-equity owner Cerberus Capital Management LP
reviewed the plan on Monday.
A source said that Ford Motor and GM would be willing to seek
further cost-cuts and concessions from the United Auto Workers
union, WSJ states. The report says that once GM reaches an
agreement with the United Auto Workers union on any wage or
benefit concessions for a rescue of the company, Chrysler, Ford
Motor will also insist on a similar arrangement. GM, according to
the report, owes the health care trust for retiree union workers
some US$7.5 billion by 2010, which many suspect the company can't
afford.
Citing a source, WSJ says that UAW President Ron Gettelfinger is
open to eliminating the jobs bank, which pays employees most of
their wages even when they no longer work in plants, but Mr.
Gettelfinger wants to see management sacrifices in return. The
sacrifices, WSJ relates, would include limits on executive
compensation and a retraining program that will help laid-off
workers get high-tech jobs in areas like battery development for
electric vehicles.
WSJ relates that sources said that GM will plan more cuts to North
American production capacity, an initiative to offer debt-holders
equity to tidy its balance sheet, and cuts to executive pay, while
aspects of the plan include goals to gain more labor concessions,
and executive pay cuts. Citing a source, the report states that
GM would also include in its plan cutting brands and details on
new fuel-efficient vehicles and how the firm will meet new
stringent federal mileage rules. The report says that GM hopes to
start selling electric plug-in car Chevrolet Volt in 2010.
Cerberus Capital is also interested in combining Chrysler with
another firm, WSJ states. Cerberus Capital had discussed selling
Chrysler to GM before the request for government aid, according to
the report.
Jeff Bennett at WSJ reports that Ford Motor is again considering
selling its Swedish luxury vehicle maker Volvo Cars, saying on
Monday that it will re-evaluate strategic options for the unit as
part of a broader effort to strengthen Ford Motor's balance sheet.
Ford Motor, according to WSJ, acquired Volvo Cars from Swedish
truck maker AB Volvo for more than US$6.5 billion in 1999.
The review could take several months, during which time Volvo Cars
will continue implementing a restructuring, which includes laying
off a quarter of its workforce, states WSJ. Mr. Mulally had
affirmed in November this year his decision in 2007 to keep Volvo
Cars after a review of the advantages of selling the unit that
year, according to the report. Mr. Mulally said last month that
he was still committed to restoring Volvo Cars' financial health,
the report states.
According to WSJ, CSM Worldwide analyst Michael Robinet doubts
that Ford Motor will be able to quickly find a suitor. The report
quoted Mr. Robinet as saying, "Anyone who purchases Volvo would
have to have very close ties to Ford because virtually every Volvo
is using a Ford platform. It will be difficult because it's not
like cutting a piece of pie that's already perforated and just
cracking it off. They are very integrated and it could take
years."
AB Volvo said on Monday that it wasn't interested in purchasing
back Volvo Cars from Ford Motor, WSJ reports.
WSJ relates that GM, Ford Motor, and Chrysler were also devising
alternative travel plans after the Congress criticized their CEOs
for using expensive corporate jets to make their way to Capitol
Hill. Ford Motor said on Monday that Mr. Mulally will drive by
car to Washington this time, while Chrysler said that its CEO
Robert Louis Nardelli has ruled out flying by private jet,
according to the report.
WSJ states that if the Congress approves the requests of GM, Ford
Motor, and Chrysler for government financial assistance, the
lawmakers would be called back to Washington next week.
Jeff Green and John Lippert at Bloomberg News report that GM, Ford
Motor, and Chrysler union leaders will hold an emergency meeting
on Dec. 3 at the Detroit Marriott Hotel. Citing a person familiar
with the matter, the report says that participants of the meeting
will be asked to reopen a 2007 labor agreement to consider
concessions.
Sources said that GM also wants to change how it pays for a union
retiree health care fund as part of a broader cost cutting plan
designed to win government aid, Bloomberg states.
About General Motors
Headquartered in Detroit, Michigan, General Motors Corp. (NYSE:
GM) -- http://www.gm.com/-- was founded in 1908. GM employs
about 266,000 people around the world and manufactures cars and
trucks in 35 countries. In 2007, nearly 9.37 million GM cars and
trucks were sold globally under the following brands: Buick,
Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel,
Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar
subsidiary is the industry leader in vehicle safety, security and
information services.
General Motors Latin America, Africa and Middle East, with
headquarters in Miramar, Florida, is one of GM's four regional
business units. GM LAAM employs approximately 37,000 people in
18 countries and has manufacturing facilities in Argentina,
Brazil, Colombia, Ecuador, Egypt, Kenya, South Africa and
Venezuela. GM LAAM markets vehicles under the Buick,
Cadillac, Chevrolet, GMC, Hummer, Isuzu, Opel, Saab and
Suzuki brands.
As reported in the Troubled Company Reporter on Nov. 10,
2008, General Motors Corporation's balance sheet at
Sept. 30, 2008, showed total assets ofUS$110.425 billion, total
liabilities of US$170.3 billion, resulting in a stockholders'
deficit of US$59.9 billion.
* * *
As reported in the Troubled Company Reporter on Nov. 11, 2008,
Standard & Poor's Ratings Services lowered its ratings, including
the corporate credit rating, on General Motors Corp. to 'CCC+'
from 'B-' and removed them from CreditWatch, where they had been
placed with negative implications on Oct. 9, 2008. S&P said that
the outlook is negative.
Fitch Ratings, as reported in the Troubled Company Reporter on
Nov. 11, 2008, placed the Issuer Default Rating of General Motors
on Rating Watch Negative as a result of the company's rapidly
diminishing liquidity position. Given the current liquidity level
ofUS$16.2 billion and the pace of negative cash flows, Fitch
expects that GM will require direct federal assistance over the
next quarter and the forbearance of trade creditors in order to
avoid default. With virtually no further access to external
capital and little potential for material asset sales, cash
holdings are expected to shortly reach minimum required operating
levels. Fitch placed these on Rating Watch Negative:
-- Senior secured at 'B/RR1';
-- Senior unsecured at 'CCC-/RR5'.
As reported in the Troubled Company Reporter on June 24, 2008,
DBRS has placed the ratings of General Motors Corp. and General
Motors of Canada Limited Under Review with Negative Implications.
The rating action reflects the structural deterioration of the
company's operations in North America brought on by high oil
prices and a slowing U.S. Economy.
MAN-IP 220: Creditors' Proofs of Debt Due on December 10
--------------------------------------------------------
The creditors of Man-IP 220 Plus (Series RF) Ltd are required to
file their proofs of debt by December 10, 2008, to be included in
the company's dividend distribution.
The company commenced liquidation proceedings on Nov. 24, 2008.
The company's liquidator is:
Beverly Mathias
c/o Argonaut Limited
Argonaut House, 5 Park Road
Hamilton HM O9, Bermuda
MAN-IP 220: Members' Final Meeting Set for December 30
------------------------------------------------------
The members of Man-IP 220 Plus (Series RF) Ltd will hold their
final general meeting on December 30, 2008, at 9:30 a.m., to hear
the liquidator's report on the company's wind-up proceedings and
property disposal.
The company commenced liquidation proceedings on Nov. 24, 2008.
The company's liquidator is:
Beverly Mathias
c/o Argonaut Limited
Argonaut House, 5 Park Road
Hamilton HM O9, Bermuda
MAN-IP DIVERSIFIED: Creditors' Proofs of Debt Due on December 10
----------------------------------------------------------------
The creditors of Man-IP Diversified Bond Limited are required to
file their proofs of debt by December 10, 2008, to be included in
the company's dividend distribution.
The company commenced liquidation proceedings on Nov. 24, 2008.
The company's liquidator is:
Beverly Mathias
c/o Argonaut Limited
Argonaut House, 5 Park Road
Hamilton HM O9, Bermuda
MAN-IP DIVERSIFIED: Members' Final Meeting Set for December 30
--------------------------------------------------------------
The members of Man-IP Diversified Bond Limited will hold their
final general meeting on December 30, 2008, at 9:30 a.m., to hear
the liquidator's report on the company's wind-up proceedings and
property disposal.
The company commenced liquidation proceedings on Nov. 24, 2008.
The company's liquidator is:
Beverly Mathias
c/o Argonaut Limited
Argonaut House, 5 Park Road
Hamilton HM O9, Bermuda
MAN-IP DIVERSIFIED: Creditors' Proofs of Debt Due on December 10
----------------------------------------------------------------
The creditors of Man-IP Diversified Bond Limited are required to
file their proofs of debt by December 10, 2008, to be included in
the company's dividend distribution.
The company commenced liquidation proceedings on Nov. 24, 2008.
The company's liquidator is:
Beverly Mathias
c/o Argonaut Limited
Argonaut House, 5 Park Road
Hamilton HM O9, Bermuda
MAN-IP DIVERSIFIED: Members' Final Meeting Set for December 30
--------------------------------------------------------------
The members of Man-IP Diversified Trading Limited will hold their
final general meeting on December 30, 2008, at 9:30 a.m., to hear
the liquidator's report on the company's wind-up proceedings and
property disposal.
The company commenced liquidation proceedings on Nov. 24, 2008.
The company's liquidator is:
Beverly Mathias
c/o Argonaut Limited
Argonaut House, 5 Park Road
Hamilton HM O9, Bermuda
TRADING 220: Creditors' Proofs of Debt Due on December 10
---------------------------------------------------------
The creditors of Trading 220 (Series 2) Limited are required to
file their proofs of debt by December 10, 2008, to be included in
the company's dividend distribution.
The company commenced liquidation proceedings on Nov. 24, 2008.
The company's liquidator is:
Beverly Mathias
c/o Argonaut Limited
Argonaut House, 5 Park Road
Hamilton HM O9, Bermuda
TRADING 220: Members' Final Meeting Set for December 30
-------------------------------------------------------
The members of Trading 220 (Series 2) Limited will hold their
final general meeting on December 30, 2008, at 9:30 a.m., to hear
the liquidator's report on the company's wind-up proceedings and
property disposal.
The company commenced liquidation proceedings on Nov. 24, 2008.
The company's liquidator is:
Beverly Mathias
c/o Argonaut Limited
Argonaut House, 5 Park Road
Hamilton HM O9, Bermuda
TRADING 220: Creditors' Proofs of Debt Due on December 10
---------------------------------------------------------
The creditors of Trading 220 (Series 3) Limited are required to
file their proofs of debt by December 10, 2008, to be included in
the company's dividend distribution.
The company commenced liquidation proceedings on Nov. 24, 2008.
The company's liquidator is:
Beverly Mathias
c/o Argonaut Limited
Argonaut House, 5 Park Road
Hamilton HM O9, Bermuda
TRADING 220: Members' Final Meeting Set for December 30
-------------------------------------------------------
The members of Trading 220 (Series 3) Limited will hold their
final general meeting on December 30, 2008, at 9:30 a.m., to hear
the liquidator's report on the company's wind-up proceedings and
property disposal.
The company commenced liquidation proceedings on Nov. 24, 2008.
The company's liquidator is:
Beverly Mathias
c/o Argonaut Limited
Argonaut House, 5 Park Road
Hamilton HM O9, Bermuda
VANGUARD INSURANCE: Court to Hear Wind-Up Petition on December 12
-----------------------------------------------------------------
A petition to have Vanguard Insurance Company Ltd.'s operations
wound up will be heard before the Supreme Court of Bermuda on
Dec. 12, 2008, at 9:30 a.m.
The Bermuda Monetary Authority filed the petition against the
company on November 19, 2008.
The Petitioner's lawyer is:
Attride-Stirling & Woloniecki
Crawford House
50 Cedar Avenue
Hamilton HM11
===========
B R A Z I L
===========
DELPHI CORP: Court Allows Reargument of Fraud Claim Order
---------------------------------------------------------
Judge Robert Drain of the U.S. Bankruptcy Court for the Southern
District of New York has issued a ruling with respect to Appaloosa
Management, L.P. and A-D Acquisition Holdings, LLC's request under
Rule 9023 of the Federal Rules of Bankruptcy Procedure, and Rule
9023-1 of the Local Rules for the United States Bankruptcy
Court for the Southern District of New York, for an order:
(i) granting reargument of the Court's August 11, 2008,
decision and, upon reargument, dismissing:
* Claims One (Breach of Contract against Investors
under the Equity Purchase and Commitment Agreement)
and Two (Breach of Contract against the parties to
the Commitment Letter Agreements) to the extent that
such claims seek specific performance or damages
against ADAH and AMLP in excess of US$250 million and
* Claims Three (claim for all defendants to perform
under Delphi's confirmed plan pursuant to Section
1142 of the Bankruptcy Code) and Four (claim of
fraud against Appaloosa) as against ADAH and AMLP,
and
(ii) striking paragraphs 71 through 83, 129, 130, and 132 of
the Complaint, which provides for, among many
allegations, that even before the Court confirmed
Delphi's Plan of Reorganization on Jan. 25, 2008,
Appaloosa engaged in efforts to avoid its obligations
under the EPCA and undermine the consummation of the
Plan.
2
In his short ruling, Judge Drain said that he is granting AMLP
and ADAH's motion to reargue and strike, to the extent of hearing
reargument. "The motion in all other respects, is denied," he
ruled.
Delphi Corp., in May 2008, sued AMLP and other parties in light of
their refusal to comply with their prior agreement to provide
US$2,550,000,000 in equity exit financing to Delphi. Appaloosa's
termination of their EPCA stalled the consummation of Delphi's
Plan of Reorganization, which was confirmed by the Court
January 25, 2008, and kept Delphi in Chapter 11.
The defendants to Delphi's US$2.55-billion lawsuit are:
- Appaloosa Management L.P.;
- A-D Acquisition Holdings, LLC;
- Harbinger Del-Auto Investment Company, Ltd.;
- Pardus DPH Holding LLC;
- Merrill Lynch, Pierce, Fenner & Smith Incorporated;
- Goldman Sachs & Co.;
- Harbinger Capital Partners Master Fund I, Ltd.;
- Pardus Special Opportunities Master Fund L.P.; and
- UBS Securities LLC.
Delphi still insists that Appaloosa wrongfully terminated the
EPCA and disputes the allegations that it breached the EPCA or
failed to satisfy any condition to the Investors' obligations
thereunder as asserted by Appaloosa in its April 4 letter.
Delphi's fraud claims rely upon the events and allegations made
by Delphi in Paragraphs 71-83 of its US$2,550,000,000 lawsuit
against Appaloosa and other parties. The allegations included
that even before the Court confirmed Delphi's Plan of
Reorganization on Jan. 25, 2008, Appaloosa engaged in efforts to
avoid its obligations under the EPCA and undermine the
consummation of the Plan.
Appaloosa notes that while those "unsupported and incorrect
allegations" have been dismissed as against every other
defendant, Delphi continues to advance the false allegations as
the "core" of its claims against Appaloosa. Accordingly,
Appaloosa asked the Court to strike Par. 71-83.
According to Reuters, Judge Drain said at a hearing on Oct. 8
that that he will reconsider Delphi's fraud claim against
Appaloosa that he had earlier dismissed. "It seems to me that I
was unclear in what aspects of the allegations needed to be dealt
with," Judge Drain said. "I may well have been wrong."
In that light, the parties submitted various memorandums that
back their positions with respect to Delphi's fraudulent omission
claim against Appaloosa. Delphi wants its fraudulent omission
claim reinstated, citing that the claim is in compliance with Rule
9(b) of the Federal Rules of Civil Procedure.
About Delphi Corp.
Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ)
-- http://www.delphi.com/-- is the single supplier of vehicle
electronics, transportation components, integrated systems and
modules, and other electronic technology. The company's
technology and products are present in more than 75 million
vehicles on the road worldwide. Delphi has regional headquarters
in Japan, Brazil and France.
The company filed for Chapter 11 protection on Oct. 8, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr.,
Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden,
Arps, Slate, Meagher & Flom LLP, represent the Debtors in their
restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A.
Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP,
represent the Official Committee of Unsecured Creditors. As of
June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000
in total assets and US$23,742,000,000 in total debts.
The Court approved Delphi's First Amended Joint Disclosure
Statement and related solicitation procedures for the solicitation
of votes on the First Amended Plan on Dec. 20, 2007. The Court
confirmed the Debtors' First Amended Plan on Jan. 25, 2008. The
Plan has not been consummated after a group led by Appaloosa
Management, L.P., backed out from their proposal to provide
US$2,550,000,000 in equity financing to Delphi.
(Delphi Bankruptcy News, Issue No. 151; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000)
DELPHI CORP: Court Gives Go Signal for Auction of Exhaust Business
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
approved the proposed bidding and auction procedures for the sale
of Delphi Corp.'s exhaust business.
The Official Committee of Unsecured Creditors in Delphi's cases
says that it is particularly concerned that the sale of the
exhaust business may not at that price may not benefit the
Debtors, and it could be more advantageous to retain the business.
The Committee, though, has not filed a formal objection to the
sale, noting that its professionals have not yet had the
opportunity to complete its due diligence with respect to the
contemplated transaction.
As reported by the Troubled Company Reporter, Delphi Corp., and
its debtor affiliates Delphi Automotive Systems LLC, and Delphi
Technologies, Inc., sought permission to sell their exhaust
business to Bienes Turgon S.A. de C.V., subject to further market
test through an auction on December 11.
John Wm. Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher
& Flom LLP, in Chicago, Illinois, relates that as part of its
transformation plan, Delphi has identified its exhaust business
as a non-core business subject to disposition. Accordingly,
following broad marketing efforts, on November 10, 2008, Delphi
Corp. and its debtor and non-debtor affiliates entered into a
Master Sale and Purchase Agreement with Bienes Turgon S.A. de
C.V.
The Agreement contemplates a global divestiture of the Exhaust
Business to Bienes Turgon for a purchase price of US$17 million,
subject to certain adjustments.
Sale of Global Exhaust Biz.
Delphi's global exhaust emissions business produces a broad array
of catalytic converters and related assemblies that are sold
globally and used in a variety of gas and diesel emissions
control applications. The company began making catalytic
converters in 1974 as the AC Spark Plug division of GM and at the
time of the Spin-Off, the operations became part of Delphi. The
Exhaust Business is part of Delphi's Powertrain business, a core
business of the Company. The Exhaust Business has a global
platform with operations at six primary manufacturing sites in
Australia, China, India, Mexico, Poland, and South Africa, all
of which -- other than the Mexican and South African sites --
also manufacture other Delphi products.
Except for the Mexican site where Delphi Entities hold a minority
interest in one joint venture, Katcon S.A. de C.V., all sites are
wholly-owned or controlled by the Delphi Entities. Sixty percent
of the Katcon joint venture is owned by Bienes Turgon and 40% is
owned by Delphi Corp's non-Debtor affiliate, Delphi Controladora,
S.A. de C.V. Delphi Automotive Systems (Holding), Inc. owns
99.99% of DCSA, and Delphi International Holdings Corp. owns .01%
of DCSA. Both DASHI and DIH are Debtors. Pursuant to this
transaction, the applicable non-Debtor Seller will be selling its
equity interest in Katcon.
In addition to certain engineering capabilities at the
manufacturing sites, the Exhaust Business also has engineering
resources located at technical centers in Luxembourg and Michigan
where engineering personnel carry out their responsibilities to
develop and test the Exhaust Business' products and associated
processes.
The dedicated workforce for the Exhaust Business is comprised of
approximately 135 salaried and 158 hourly employees. Of these
employees, 23 are U.S. employees, all of whom are salaried
employees (primarily engineers).
The Exhaust Business is benefiting because of increasingly
stringent regulatory exhaust emission requirements in the global
market which aim to reduce noxious emissions. For the year ended
December 31, 2007, the Exhaust Business achieved revenue of
US$294.4 million and EBITDA of US$19.1 million on a pro-forma
basis, excluding certain Delphi
Because of the increasingly stringent environmental requirements,
the company believes that with the right buyer, the Exhaust
Business has strong growth prospects. The revenue from the
Exhaust Business is comprised of two different value streams: (i)
76% is through a customer-directed purchase process through which
the Delphi Entities obtain catalyst material from a specified
supplier and pass it to the customer, receiving a handling fee
but not otherwise adding value to the product and (ii) 24% is
generated from sale of product to which Delphi has added content,
thereby increasing its value.
Nearly two-thirds of the Exhaust Business sales are to GM and its
affiliates, virtually all of which is sold outside of the U.S.
In addition to its customer relationship with GM, the Exhaust
Business has customer relationships with many other leading
original equipment manufacturers, including AvtoVAZ, Brilliance,
Ford, and Renault.
Bidding Procedures
The Sale of the Exhaust Business would be subject to higher or
otherwise better offers.
The Debtors propose a December 8, 2008 at 11 a.m. (prevailing
Eastern time) deadline to submit bids for the Exhaust Business.
In light of the short timeframe, the Debtors are commencing the
process of contacting potential bidders and will open the virtual
data room to such parties even prior to Nov. 24 hearing.
Bids must at least have a value equal to the purchase price plus
the amount of the Break-Up Fee, plus US$650,000 (approximately
$18,160,000).
If the Selling Debtor Entities receive at least one "qualified
bid" in addition to that of the Bienes Turgon, they would conduct
an auction on December 11, 2008.
Delphi will seek approval of the sale to Bienes Turgon or to the
winning bidder on December 17, 2008 at 10:00 a.m. Objections are
due December 10, 2008 at 4:00 p.m.
A full-text copy of the Court-approved Bid Procedures is available
for free at:
http://bankrupt.com/misc/delphi_exhaust_bsns_bidprocedures.pdf
About Delphi Corp.
Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ)
-- http://www.delphi.com/-- is the single supplier of vehicle
electronics, transportation components, integrated systems and
modules, and other electronic technology. The company's
technology and products are present in more than 75 million
vehicles on the road worldwide. Delphi has regional headquarters
in Japan, Brazil and France.
The company filed for Chapter 11 protection on Oct. 8, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr.,
Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden,
Arps, Slate, Meagher & Flom LLP, represent the Debtors in their
restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A.
Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP,
represent the Official Committee of Unsecured Creditors. As of
June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000
in total assets and US$23,742,000,000 in total debts.
The Court approved Delphi's First Amended Joint Disclosure
Statement and related solicitation procedures for the solicitation
of votes on the First Amended Plan on Dec. 20, 2007. The Court
confirmed the Debtors' First Amended Plan on Jan. 25, 2008. The
Plan has not been consummated after a group led by Appaloosa
Management, L.P., backed out from their proposal to provide
US$2,550,000,000 in equity financing to Delphi.
(Delphi Bankruptcy News, Issue No. 151; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000)
DELPHI CORP: Delays Hearing on Bankruptcy Exit Plan to Dec. 17
--------------------------------------------------------------
The hearing to consider preliminary approval of the Delphi Corp.'
and its affiliates' proposed modifications to their confirmed
First Amended Joint Plan of Reorganization has been adjourned to
10:00 a.m. on December 17, 2008.
Delphi presented to the U.S. Bankruptcy Court for the Southern
District of New York changes to an already confirmed Plan after
Appaloosa Management, L.P., and other investors backed out from
their commitment to provide US$2.550 billion in exit financing.
The new plan does not require financing from plan investors, but
requires more funding from primary customer General Motors Corp.,
which is facing its own liquidity crisis, andUS$3.75 billion from
an exit debt financing and a rights offering.
The Preliminary Plan Modification Hearing has been adjourned
three times. Under the original schedule, the Debtors
contemplated an October 23, 2008 preliminary hearing and
emergence from bankruptcy by Dec. 31, 2008.
Delphi Corp. has signed deals with General Motors Corp. and its
DIP Lenders, led by JPMorgan Chase Bank, N.A., in order to have
access to borrowed cash until mid-2009. The Debtors' financing
deals mature Dec. 31, 2008.
On Oct. 3, the Debtors submitted proposed modifications to their
Plan of Reorganization. Under the modified plan, the Debtors
targeted a Dec. 17 confirmation hearing, and a Chapter 11 exit by
year-end. The modified plan does not require, in addition to
US$4,700,000,000 of debt exit financing, Appaloosa's
US$2,550,000,000 cash-for-equity investment, which was the
highlight of the Court- confirmed, but unconsummated, Jan. 25,
2008 PoR. The modified plan requires debt exit financing of
US$2.75 billion plus a US$1,000,000,000 raised through a rights
offering.
Delphi, however, has said that "in the face of the current
unprecedented turbulence in the credit markets and uncertainty in
the automobile industry," it does not anticipate emerging from
chapter 11 prior to December 31, 2008, when its financing deals
mature.
"Despite the efforts of the federal government to provide
stability to the capital markets and banks, the markets have
remained extremely volatile and liquidity in the capital markets
has been nearly frozen, resulting in an unprecedented challenge
for the Debtors to successfully attract emergence capital funding
for their Modified Plan, particularly in light of the current
conditions in the global automotive industry," John Wm. Butler,
Jr., Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in
Chicago, Illinois, said, in a court filing.
In its third quarter report on Form 10-Q, General Motors Corp.,
Delphi's primary customer, admitted, "Given the current credit
markets and the challenges facing the automotive industry, there
can be no assurance that Delphi will be successful in obtaining
US$3.8 billion in exit financing to emerge from bankruptcy."
GM has recorded Delphi-related charges US$4.1 billion for nine
months ended Sept. 30, 2008. GM recorded a net loss of
US$2,542,000,000 on US$37,503,000,000 of revenues for three months
ended Sept. 30, 2008, compared with a net loss of
US$38,963,000,000 o nUS$43,002,000,000 of sales during the same
period in 2007.
General Motors, along with Ford Motor Company and Chrysler LLC,
has asked Congress to grant the U.S. carmakers access to
US$25 billion of the US$700 billion Troubled Asset Relief Program
approved by Congress to bail out financial institutions.
Congress is expected to tackle on Nov. 18 and 19 the proposed
bailout, which, according to reports, may be necessary to save
the U.S. automakers from collapse or bankruptcy.
A bankruptcy filing for GM could shatter its former unit Delphi's
plans to finally exit bankruptcy this year or early next year,
according to a report by Bloomberg News. "If GM fails, it's
likely the Delphi reorganization fails, and Delphi converts to a
case under Chapter 7 -- a liquidation," Nancy Rapoport, a law
professor at the University of Nevada-Las Vegas, in an e-mail,
according to Bloomberg News. "For the creditors of Delphi, this
of course isn't optimal, and the usual issues in Chapter 7,
determining the liquidation value of the company, will apply."
About Delphi Corp.
Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ)
-- http://www.delphi.com/-- is the single supplier of vehicle
electronics, transportation components, integrated systems and
modules, and other electronic technology. The company's
technology and products are present in more than 75 million
vehicles on the road worldwide. Delphi has regional headquarters
in Japan, Brazil and France.
The company filed for Chapter 11 protection on Oct. 8, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr.,
Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden,
Arps, Slate, Meagher & Flom LLP, represent the Debtors in their
restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A.
Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP,
represent the Official Committee of Unsecured Creditors. As of
June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000
in total assets and US$23,742,000,000 in total debts.
The Court approved Delphi's First Amended Joint Disclosure
Statement and related solicitation procedures for the solicitation
of votes on the First Amended Plan on Dec. 20, 2007. The Court
confirmed the Debtors' First Amended Plan on Jan. 25, 2008. The
Plan has not been consummated after a group led by Appaloosa
Management, L.P., backed out from their proposal to provide
US$2,550,000,000 in equity financing to Delphi.
(Delphi Bankruptcy News, Issue No. 151; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000)
DELPHI CORP: Gets Six Months Extension of US$4.35-Bil. DIP Loan
---------------------------------------------------------------
Delphi Corp. won approval from the U.S. Bankruptcy Court for the
Southern District of New York to extend until June 30, 2009, the
maturity date of its US$4.35 billion DIP financing, Bloomberg News
reports.
Delphi, according to the report, can use proceeds from its
US$4.35 billion bankruptcy loan to fund operations while working
to emerge from Chapter 11 protection. Delphi previously
contemplated a Dec. 31, 2008 emergence from bankruptcy but has
found difficulty accessing credit.
Delphi in October presented to the Bankruptcy Court changes to an
already confirmed Plan after Appaloosa Management, L.P., and other
investors backed out from their commitment to provide US$2.550
billion in exit financing. The new plan does not require
financing from plan investors, but requires more funding from
primary customer General Motors Corp., which is facing its own
liquidity crisis, and US$3.75 billion from an exit debt financing
and a rights offering. Delphi has deferred seeking approval of
the plan and has instead sought an extension if its bankruptcy
loan.
The Debtors, on Nov. 7, filed with the Bankruptcy Court sought
authority to continue their use of the proceeds from their DIP
Facility through June 30, 2009, by entering into an accommodation
agreement with JPMorgan Chase Bank, N.A., as administrative agent,
and certain lenders that constitute the majority of holders by
amount of Delphi's two most senior tranches of its DIP Credit
Facility -- the "Required Lenders".
Delphi stated that while the original form of the accommodation
agreement was acceptable to GM, Delphi agreed with GM to
reconsider certain of the subsequent amendments agreed to between
Delphi and the "required lenders" under the DIP Facility.
Delphi stated its intent to engage in discussions with GM and
certain of Delphi's lenders under the existing DIP financing
agreement in an attempt to identify acceptable changes to the
documents presented to the Court.
Delphi said that when filed, the Accommodation Agreement
reflected the support of the administrative agent and the
anticipated support of the Required Lenders for Delphi's
transformation efforts, despite the current economic downturn and
the unprecedented turmoil in the capital markets. The company
made various changes to the Accommodation Agreement since the
Nov. 7 filing in order to obtain support from as many DIP lenders
as practicable and has received signature pages from more than
the Required Lenders needed to implement the agreement.
Delphi Will Go Through Half Its Cash By March
Delphi, in a Nov. 28 filing with the Securities and Exchange
Commission said that it would provide supplemental financial in
connection with their solicitation of lenders' consents to the
Accommodation Agreement. This information includes near-term
forecast updates to cash flows and liquidity levels through
March 31, 2009:
(in millions) 2008 | 2009
-------------------------------------------|------------------
Actual | Projected
Cash June Sep Oct | Nov Dec | Jan Feb Mar
--------------------------------------------------------------
U.S. Cash $148 $1,136 $793 $417 $198 | $34 $28 $26
|
Non-U.S. |
Cash 985 788 843 862 1,176 | 935 857 715
--------------------------------------------------------------
Consoli- 1,133 1,904 1,636 1,279 1,374 | 969 885 741
ted Cash |
--------------------------------------------------------------
Availa-
bility
DIP 613 138 46 - - | - - -
GM
Support 300 - - 300 300 | 300 215 110
--------------------------------------------------------------
Total $ 913 $138 $46 $300 $300 | $300 $215 $110
Avai-
lability |
--------------------------------------------------------------
Cash and |
Availa- |
bility $2,046 $2,042 $1,682 $1,579 $1,674 $1,269 $1,100 $851
==============================================================
DIP |
Revolver |
Balance 311 465 511 397 397| 370 370 370
GM Agreement |
Balance - - - - - _ 85 190
|
Memo: Borrowing Base Cash Collateral |
- - - - 200| 200 155 150
According to Bloomberg News, the disclosure means that Delphi
will burn through US$633 million in cash from December through
March, or almost half its reserves.
The Debtors' US$4,350,000,000 DIP facility consists of:
Tranche Facility
------- --------
A US$1,100,000,000 first priority revolving
Credit facility
B US$500,000,000 first priority term loan
C Approximately US$2,750,000,000 second priority
term loan.
Through the Accommodation Agreement, certain Tranche A Lenders
and Tranche B Lenders would agree to, among other things, allow
the Debtors to continue using the proceeds of the DIP Facility
notwithstanding, among other things, the DIP Facility's maturity
date of December 31, 2008.
Delphi is facing opposition from some of its lenders, who,
according to CNNmoney.com, say the other lenders who agreed to
the extension arranged a "sweetheart deal" for themselves. The
third lender group who said the arrangement would "trample" their
rights by giving additional liens to the other lenders that have
consented to the change, Dow Jones reports.
The lenders that are opposing the loan changes said their
collateral is at risk as Delphi burns through cash. The opposing
lenders also said a subset of lenders, led by JPMorgan, would see
$200 million in unsecured claims elevated to first-priority lien
status.
About Delphi Corp.
Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ)
-- http://www.delphi.com/-- is the single supplier of vehicle
electronics, transportation components, integrated systems and
modules, and other electronic technology. The company's
technology and products are present in more than 75 million
vehicles on the road worldwide. Delphi has regional headquarters
in Japan, Brazil and France.
The company filed for Chapter 11 protection on Oct. 8, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr.,
Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden,
Arps, Slate, Meagher & Flom LLP, represent the Debtors in their
restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A.
Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP,
represent the Official Committee of Unsecured Creditors. As of
June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000
in total assets and US$23,742,000,000 in total debts.
The Court approved Delphi's First Amended Joint Disclosure
Statement and related solicitation procedures for the solicitation
of votes on the First Amended Plan on Dec. 20, 2007. The Court
confirmed the Debtors' First Amended Plan on Jan. 25, 2008. The
Plan has not been consummated after a group led by Appaloosa
Management, L.P., backed out from their proposal to provide
US$2,550,000,000 in equity financing to Delphi.
(Delphi Bankruptcy News, Issue No. 151; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000)
DELPHI CORP: Tranche C Lenders, et al., Balk at DIP Loan Extension
------------------------------------------------------------------
Greywolf Capital Management, LP, Tranche C Lender under Delphi
Corp.'s DIP Credit Agreement, opposes an extension of the loan's
maturity date, contending that Delphi sought an extension of the
maturity date, without adhering to the requirements of the DIP
Facility.
As reported in today's Troubled Company Reporter, according to a
Bloomberg News report, Delphi won approval from the U.S.
Bankruptcy Court for the Southern District of New York to extend
until June 30, 2009, the maturity date of its US$4.35 billion DIP
financing.
Ronald R. Sussman, Esq. at Cooley Godward Kronish LLP, in New
York, notes that Delphi, expecting that DIP Lenders' unanimous
consent for the extension of the maturity date of the DIP Credit
Agreement is not possible, seeks to force Greywolf into
indentured servitude by holding by hostage for an additional six
months, its funds in excess of US$100,000,000, Mr. Sussman says.
This, he adds is in direct contravention of the terms of the DIP
Credit Agreement.
To note, the extension of the maturity date of the DIP Credit
Agreement is prohibited by the plain terms of the DIP Credit
Agreement. The extension of the maturity date of the DIP Credit
Agreement can only be obtained through a unanimous consent of all
the Lenders, Mr. Sussman contends.
M.D. Sasse Re/Enterprise Portfolio Company L.P., another Tranche
C Lender, shares Greywolf's contentions regarding the need for
the Debtors to get a unanimous consent of the Lenders as a
requirement to obtain approval to supplement the DIP Credit
Agreement.
Other Tranche C Lenders also asked the Court to deny the terms of
the proposed extension, citing that Delphi is seeking to elevate
$200,000,000 of pre-existing unsecured hedging obligations to
first priority liens status, thereby diluting the liens held by
all first-lien lenders and priming holders of Tranche C Loans,
with all these being done to the Lenders at a time when
macroeconomic conditions and the automotive industry in
particular, are their weakest point in decades. Furthermore, the
Tranche C Collective asks the Court, pursuant to Sections 361(e)
and 363(e) of the Bankruptcy Code in exchange for the Debtors'
continued use of the collateral in these Chapter 11 cases.
The Tranche C collective is composed of these Lenders:
-- Sberdeen Loan Funding Ltd.
-- Anchorage Capital Master Offshore, Ltd.
-- Anchorage Crossover Credit Offshore Master Fund, Ltd.
-- Carlson Capital, L.P
-- Geer Mountain Financing Ltd.
-- Highland Credit Opportunities CDO Ltd.
-- Hillmark Funding Ltd.
-- Luxor Capital, LLC
-- Mariner LDC
-- Mariner Tricadia Credit Strategies Master Fund Ltd.
-- Monarch Alternative Capital LP
-- OHP CBNA Funding LLC
-- Pentwater Credit Partners, Ltd.
-- RiverSource Investments, LLC
-- Silver Point Capital Fund, L.P.
-- Spectrum Investment Partners, L.P.
-- Stoney Lane Funding Ltd.
-- Tricadia Distressed and Special Situations Master Fund Ltd.
-- West Gate Horizon Advisors
-- WhiteHorse I, Ltd.
-- Whitehorse II, Ltd.
-- Whitehorse III, Ltd.
-- Whitehorse IV, Ltd.
Susheel Kirpalani, Esq., at Quinn Emmanuel Urquhart Oliver &
Hedges, LLP, in New York, told the Court that the relief requested
by the Tranche C Collective is narrowly tailored to the harms to
be avoided, and is warranted when:
(i) traditional means of adequate protection are not available
based on the unique facts of these cases; and
(ii) the Accommodation Agreement ensures the Collateral's trend
toward decline will continue at alarming rate.
Moreover, Mr. Kirpalani asserts, in operating the Debtors'
businesses post-maturity, the Court should take measures,
pursuant to Section 1107(a) of the Bankruptcy Code, to establish
a closer watch over the estates and ensure that the rights of all
parties in interest are continuously monitored consistent with
the Bankruptcy Code, including the priority provisions therein
and pursuant to the Court's prior DIP financing orders.
Select Tranche A and B Lenders also objected to the Accommodation
Agreement. Calyon New York Branch, a Tranche A Lender under the
DIP Credit Agreement, asked the Court to deny the Debtors' motion
or in the alternative, direct the Debtors and their Agents to
count votes for or against the proposed Accommodation Agreement in
accordance with the voting rules set out in the DIP Credit
Agreement. Calyon contends that there are provisions of the DIP
Credit Agreement that prohibit modifications of the type sought in
the Proposed Accommodation Agreement which the Debtors did not
discuss in their motion.
In an addition, an ad hoc group of Tranche A and B DIP Lenders
asked the Court to direct the Debtors to provide adequate
protection for the use of their collateral. Represented by David
Neier, Esq., at Winston & Strawn LLP, in New York, the Ad Hoc
Group clarifies that it would support an accommodation agreement
in aid of the Debtors' reorganization. However, the Ad Hoc Group
wants the Accommodation Agreement, in its current form, denied
because, among other things, the Debtors seek to provide liens for
US$200,000,000 of presently unsecured Hedging Obligations of the
Debtors, and the liens will be pari passu with the DIP liens
granted to the Ad Hoc Group, even though the Debtors will be
in default of the DIP Credit Agreement on the maturity date,
December 31, 2008.
Other key parties, like the Official Committee of Equity Security
Holders and the Official Committee of Unsecured Creditors,
expressed support on the Accommodation Agreement. The Equity
Committee said some of the lenders have been overreaching in
certain respects, however it believes that the Debtors have sought
the best and most beneficial arrangement they deem possible while
attempting to resolve the issues raised by the lenders under the
DIP Facility.
The Creditors Committee says that while it does not object to
other concessions the Debtors propose to make to the DIP lenders
in the Accommodation Agreement, including to the Tranche C
lenders, the Committee submits that granting voting rights where
none currently exist makes little sense and increases the risk
that actions of the Tranche C lenders may negatively affect the
Debtors' restructuring efforts.
The Debtors, in response to the objections, say that
notwithstanding the various objections filed in opposition to the
Accommodation Motion, nearly all of the Objecting Lenders actually
agree that an accommodation is the preferred outcome.
About Delphi Corp.
Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ)
-- http://www.delphi.com/-- is the single supplier of vehicle
electronics, transportation components, integrated systems and
modules, and other electronic technology. The company's
technology and products are present in more than 75 million
vehicles on the road worldwide. Delphi has regional headquarters
in Japan, Brazil and France.
The company filed for Chapter 11 protection on Oct. 8, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr.,
Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden,
Arps, Slate, Meagher & Flom LLP, represent the Debtors in their
restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A.
Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP,
represent the Official Committee of Unsecured Creditors. As of
June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000
in total assets and US$23,742,000,000 in total debts.
The Court approved Delphi's First Amended Joint Disclosure
Statement and related solicitation procedures for the solicitation
of votes on the First Amended Plan on Dec. 20, 2007. The Court
confirmed the Debtors' First Amended Plan on Jan. 25, 2008. The
Plan has not been consummated after a group led by Appaloosa
Management, L.P., backed out from their proposal to provide
US$2,550,000,000 in equity financing to Delphi.
(Delphi Bankruptcy News, Issue No. 151; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000)
UNIBANCO: Presentation to Investors Scheduled on Dec. 9
-------------------------------------------------------
The Executive Boards of Itausa - Investimentos Itau S.A. and Itau
Unibanco Banco Multiplo S.A. said the the presentations they will
make to members of the Association of Capital Markets Analysts and
Investment Professionals, shareholders and any other interested
parties will be on:
Date: December 9, 2008,
Place: Buffet Rosa Rosarum Rua Francisco Leitao,
416 - Pinheiros - Sao Paulo - Capital.
As reported by the Troubled Company Reporter - Latin America on
November 5, 2008, a joint-venture agreement was executed
envisioning the merger of the financial operations of Itau and
Uniao de Bancos Brasileiros S.A. ("Unibanco"), the controlling
shareholders of Investimentos Itau S.A and Unibanco Holdings said
in a statement.
The joint-venture provides for a corporate restructuring, which
will cause the migration of the current shareholders of Unibanco
Holdings S.A. ("Unibanco Holdings") and Unibanco to a public
listed company to be called Itau Unibanco Holding S.A., currently
Banco Itau Holding Financeira S.A. ("Itau Unibanco Holding"),
which will be made through a merger of shares.
About Uniao de Bancos
Headquartered in Sao Paulo, Brazil, Uniao de Bancos Brasileiros
SA -- http://www.unibanco.com/-- is a full-service financial
institution providing a range of financial products and services
to a diversified individual and corporate customer base
throughout Brazil. The company's businesses comprise segments:
Retail, Wholesale, Insurance and Pension Plans and Wealth
Management. Uniao de Bancos and its associated companies
FinInvest, LuizaCred, PontoCred and Tecban (Banco 24 Horas)
offer a network composed of 17,000 points of service. It also
counts on 7,580 automated teller machines and all 30 Hours'
products and services, including the telephone service and the
Internet banking. The company's international network consists
of branches in Nassau and the Cayman Islands; representatives
offices in New York; banking subsidiaries in Luxembourg, the
Cayman Islands and Paraguay; and a brokerage firm in New York
-- Unibanco Securities Inc.
* * *
In April 2008, Moody's Investors Service assigned a Ba2 foreign
currency deposit rating to Uniao de Bancos Brasileiros SA.
PETROLEO BRASILEIRO: Bovespa Index May Raise Company's Weight
-------------------------------------------------------------
Petroleo Brasileiro SA may be more heavily weighted in next year's
Bovespa index of most-traded shares in Sao Paulo, Paulo
Winterstein of Bloomberg News reports.
Citing a BM&FBovespa SA stock exchange data, the report relates
Petrobras will account for more than 19% of the index, from
15.8%currently. The changes are scheduled to go into effect at
the beginning of January, the report says.
Bloomberg News says materials producers will likely increase their
weight in the Bovespa after the changes, accounting for about 52%
of the index.
Petrobras preferred stock will have the biggest absolute gain in
the index, with its weight rising almost 3 percentage points to
16.4% from 13.5%, the report notes. Common shares of the Bovespa
exchange will have the second-biggest absolute gain, according to
the same report.
About Petroleo Brasileiro
Headquartered in Rio de Janeiro, Brazil, Petroleo Brasileiro SA
aka Petrobras -- http://www2.petrobras.com.br/ingles/index.asp
-- was founded in 1953. The company explores, produces,
refines, transports, markets, distributes oil and natural gas
and power to various wholesale customers and retail distributors
in Brazil. Petrobras has operations in China, India, Japan, and
Singapore.
* * *
As reported in the Troubled Company Reporter-Latin America on
May 14, 2007, Fitch Ratings upgraded Brazil's long-term foreign
and local currency sovereign Issuer Default Ratings to 'BB+'
from 'BB' and the Country Ceiling to 'BBB-' from 'BB+'. In
addition, Fitch affirmed Brazil's Short-term IDR at 'B'. Fitch
said the rating outlook is stable.
* BRAZIL: May Tap BRL15BB Sovereign Fund to Fuel Economic Growth
----------------------------------------------------------------
Brazil may tap BRL15 billion (US$6.35 billion) put aside for a
yet-to-be-approved sovereign wealth fund to ease the impact of the
global credit crisis next year, Francisco Marcelino of Bloomberg
News reports, citing Finance Minister Guido Mantega.
According to the report, Brazilian companies have been unable to
meet 25% to 30% of their financing needs as external credit dried
up. The wealth fund might help the state development bank known
as BNDES boost lending to local companies, former central bank
director Carlos Thadeu de Freitas Gomes told Bloomberg News.
The report says Morgan Stanley forecast that Brazil may fall into
a "technical recession" in the coming quarters.
Meanwhile, the report relates Minister Mantega said the
government's "challenge" is to secure economic growth of 4% next
year.
President Luiz Inacio Lula da Silva, the report recounts, asked
Congress in July to establish a wealth fund that would hold the
equivalent of 0.5% of gross domestic product in 2008.
Bloomberg News notes that the government has already set aside
money for the fund, effectively raising the budget surplus target
before interest payments this year to 4.3% of GDP.
Should Congress fail to approve the wealth fund by yearend, the
government will have to use the money for items included in the
2008 budget or for interest payments, the report says.
In an interview with Bloomberg News, Mr. Gomes said the wealth
fund might buy bonds issued by the state development bank known as
BNDES, which in turn could fund local companies. "If the economy
and tax collection slow down sharply, the government may pump more
money into the economy using the sovereign fund," he added.
The Federative Republic of Brazil is the largest and most populous
country in South America. It is the fifth largest country by
geographical area, the fifth most populous country, and the fourth
most populous democracy in the world. Its population comprises
the majority of the world's Portuguese speakers. According to
Moody's Rating Agency, the country continues to carry a BA1 local
and foreign currency rating.
==========================
C A Y M A N I S L A N D S
==========================
AERCAP 320: Creditors' Proofs of Debt Due on December 11
--------------------------------------------------------
The creditors of Aercap 320 Limited are required to file their
proofs of debt by December 11, 2008, to be included in the
company's dividend distribution.
The company commenced liquidation proceedings on Oct. 23, 2008.
The company's liquidator is:
Tom Kelly
c/o Maples and Calder, Attorneys-at-law
PO Box 309, Ugland House
Grand Cayman KY1-1104, Cayman Islands
AERCAP 320: Final General Meeting Set for December 15
-----------------------------------------------------
The members of Aercap 320 Limited will hold their final general
meeting on December 15, 2008, to receive the liquidator's report
on the company's wind-up proceedings and property disposal.
The company commenced liquidation proceedings on Oct. 23, 2008.
The company's liquidator is:
Tom Kelly
c/o Maples and Calder, Attorneys-at-law
PO Box 309, Ugland House
Grand Cayman KY1-1104, Cayman Islands
AERCAP 320 C: Creditors' Proofs of Debt Due on Dec. 11
------------------------------------------------------
The creditors of Aercap 320 C Limited are required to file their
proofs of debt by December 11, 2008, to be included in the
company's dividend distribution.
The company commenced liquidation proceedings on October 23, 2008.
The company's liquidator is:
Tom Kelly
c/o Maples and Calder, Attorneys-at-law
PO Box 309, Ugland House
Grand Cayman KY1-1104, Cayman Islands
AERCAP 320 C: Final Meeting Slated for December 15
--------------------------------------------------
The members of Aercap 320 C Limited will hold their final general
meeting on December 15, 2008, to receive the liquidator's report
on the company's wind-up proceedings and property disposal.
The company commenced liquidation proceedings on October 23, 2008.
The company's liquidator is:
Tom Kelly
c/o Maples and Calder, Attorneys-at-law
PO Box 309, Ugland House
Grand Cayman KY1-1104, Cayman Islands
AIR TARA: Creditors' Proofs of Debt Due on December 11
------------------------------------------------------
The creditors of Air Tara Hong Kong Limited are required to file
their proofs of debt by December 11, 2008, to be included in the
company's dividend distribution.
The company commenced liquidation proceedings on October 23, 2008.
The company's liquidator is:
Tom Kelly
c/o Maples and Calder, Attorneys-at-law
PO Box 309, Ugland House
Grand Cayman KY1-1104, Cayman Islands
AIR TARA: Final General Meeting Set for December 15
---------------------------------------------------
The members of Air Tara Hong Kong Limited will hold their final
general meeting on December 15, 2008, to receive the liquidator's
report on the company's wind-up proceedings and property disposal.
The company's liquidator is:
Tom Kelly
c/o Maples and Calder, Attorneys-at-law
PO Box 309, Ugland House
Grand Cayman KY1-1104, Cayman Islands
CARDIFF LTD: Shareholders' Meeting Set for December 15
------------------------------------------------------
The shareholders of Cardiff Ltd. will meet on December 15, 2008,
at 10:00 a.m., to receive the liquidator's report on the company's
wind-up proceedings and property disposal.
The company's liquidator is:
Stuart Sybersma
Jessica Turnbull, Deloitte & Touche
P.O. Box 1787GT, Grand Cayman
Cayman Islands
Telephone:(345) 949-7500
Facsimile:(345) 949-8258
EEGO FUND: Placed Under Voluntary Liquidation
---------------------------------------------
The sole shareholder of Eego Fund Limited resolved to voluntarily
liquidate the company's business on October 20, 2008.
Only creditors who were able to file their proofs of debt by
November 30, 2008, will be included in the company's dividend
distribution.
The company's liquidator is:
James Bitzer
c/o Caledonian House
PO Box 1043, Grand Cayman KY1-1102
Tel: +345 914 4910
Fax: +345 814 4868
ELASIS (CAYMAN ISLANDS): Creditors' Proofs of Debt Due on Dec. 11
-----------------------------------------------------------------
The creditors of Elasis (Cayman Islands) Limited are required to
file their proofs of debt by December 11, 2008, to be included in
the company's dividend distribution.
The company commenced liquidation proceedings on Oct. 23, 2008.
The company's liquidator is:
Tom Kelly
c/o Maples and Calder, Attorneys-at-law
PO Box 309, Ugland House
Grand Cayman KY1-1104, Cayman Islands
ELASIS (CAYMAN ISLANDS): Final Meeting Slated for December 15
-------------------------------------------------------------
The members of Elasis (Cayman Islands) Limited will hold their
final general meeting on December 15, 2008, to receive the
liquidator's report on the company's wind-up proceedings and
property disposal.
The company commenced liquidation proceedings on October 23, 2008.
The company's liquidator is:
Tom Kelly
c/o Maples and Calder, Attorneys-at-law
PO Box 309, Ugland House
Grand Cayman KY1-1104, Cayman Islands
GENNAKER I: Moody's Junks Ratings on Classes C & D Notes
--------------------------------------------------------
Moody's Investors Service has downgraded its ratings of six
classes of notes and left on review for further possible downgrade
its ratings of five classes of notes issued by Gennaker I CDO
Limited.
The transaction is a managed cash CDO referencing, among other
assets US ABS CDOs, high yield CDOs, RMBS subprime of the 2000 to
2007 vintages. These rating actions are a response to credit
deterioration in the underlying portfolio due, in a significant
proportion, to expectations of increased losses in the underlying
RMBS and ABS CDO assets as well as corporate name defaults and
general corporate deterioration. A significant proportion of the
assets are now rated sub-investment grade.
Moody's announced on Sept. 18, 2008, that it is revising its
expected loss assumptions of subprime and prime RMBS, specifically
of the second half 2005 -- first half 2007 vintages. Moody's
stated that for purposes of monitoring its ratings of ABS CDOs
with exposure to second half 2005 -- first half 2007 subprime
RMBS, it will rely on certain projections of the lifetime average
cumulative losses for vintages of RMBS set forth in a recent
Moody's Special Report.
Moody's also announced in a press release on Nov. 17, 2008, that
it is revising its expectations of lifetime losses on pools
backing US Alt-A residential mortgage-backed securities issued in
2006 and 2007. Moody's explained that it will utilize these
revised loss projections when monitoring ABS CDO ratings.
According to Moody's, the rating actions are also the result of
deterioration in the credit quality of the transaction's reference
portfolio, which includes but is not limited to exposure to Lehman
Brothers Holdings Inc., which filed for protection under Chapter
11 of the U.S. Bankruptcy Code on Sept. 15, 2008; Washington
Mutual Inc., which was seized by federal regulators on Sept. 25,
2008 and subsequently virtually all of its assets were sold to
JPMorgan Chase; Fannie Mae and Freddie Mac, which were placed into
the conservatorship of the U.S. government on Sept. 8, 2008.
The transaction also has a significant exposure to other corporate
names which continue to deteriorate in the current economic
environment. This will weigh on the ratings of the tranches in
this transaction.
These rating actions are:
Issuer: Gennaker I CDO Limited
(1) US$521,700,000 Class A-1A Floating Rate Notes Due 2045
(currently US$519,527,423 outstanding)
-- Current Rating: Aa1, on review for possible downgrade
-- Prior Rating: Aaa
-- Prior Rating Action Date: Aug. 24, 2005
(2) US$0 Class A-1B Floating Rate Notes Due 2045
-- Current Rating: Aa1, on review for possible downgrade
-- Prior Rating: Aaa
-- Prior Rating Action Date: Aug. 24, 2005
(3) US$25,800,000 Class A-2 Floating Rate Notes Due 2045
-- Current Rating: A2, on review for possible downgrade
-- Prior Rating: Aaa
-- Prior Rating Action Date: Aug. 24, 2005
(4) US$12,900,000 Class B Floating Rate Notes Due 2045
-- Current Rating: Ba1, on review for possible downgrade
-- Prior Rating: Aa2
-- Prior Rating Action Date: Aug. 24, 2005
(5) US$13,560,000 Class C Deferrable Floating Rate Notes Due 2045
-- Current Rating: Caa1, on review for possible downgrade
-- Prior Rating: A1
-- Prior Rating Action Date: Aug. 24, 2005
(6) US$13,020,000 Class D Deferrable Floating Rate Notes Due 2045
(currently US$11,690,480 outstanding)
-- Current Rating: C
-- Prior Rating: Baa1
-- Prior Rating Action Date: Aug. 24, 2005
G SQUARE: S&P Junks Ratings on Class A Sr. Floating-Rate Notes
--------------------------------------------------------------
Standard & Poor's Ratings Services said that it has lowered and
removed from CreditWatch negative its credit ratings on the class
B notes issued by G Square Finance 2006-1 Ltd. The class A-1 and
A-2 notes were lowered and remain on CreditWatch negative. The
'AAA' ratings on the class X notes remain unaffected.
The rating actions follow further deterioration in the credit
quality of the underlying portfolio, reflected in continuing
downgrades and CreditWatch negative placements for certain U.S.
RMBS and U.S. CDOs of ABS in the underlying portfolio. This has
led to an increase in S&P's portfolio scenario default rates for
all rating scenarios.
In addition, changes in credit enhancement levels due to defaults
in the underlying portfolio have resulted in a decrease in the
break-even default rates for the tranches when subject to S&P's
cash flow analysis. As a result of changes to both the SDRs and
BDRs, the previous rating levels could no longer be maintained.
S&P will continue to closely monitor this deal's performance, and
run further cash flow analyses before resolving these CreditWatch
placements. S&P will pay particular attention to the resolution
of the outstanding CreditWatch placements on the aforementioned
underlying U.S. RMBS and CDOs of ABS securities.
Ratings List
G Square Finance 2006-1 Ltd.
US$1.49 Billion And EUR17 Million
Senior Secured Floating-Rate Notes
Ratings Lowered and Remaining on CreditWatch
Class Rating
----- ------
To From
-- ----
A-1 CCC-/Watch Neg BBB-/Watch Neg
A-2 CCC-/Watch Neg BB+/Watch Neg
Ratings Removed From CreditWatch Negative and Lowered
Class Rating
----- ------
To From
-- ----
B CC CCC+/Watch Neg
O'CONNOR PROPRIETARY: Shareholders' Final Meeting Set for Dec. 11
-----------------------------------------------------------------
The shareholders of O'Connor Proprietary Seriescurrencies & Rates,
Fundamental Long/Short and Convertible Arbitrage Limited
will meet on December 11, 2008, at 11:00 a.m., to receive the
liquidator's report on the company's wind-up proceedings and
property disposal.
The company's liquidator is:
Stuart Sybersma
Jessica Turnbull, Deloitte & Touche
P.O. Box 1787GT, Grand Cayman
Cayman Islands
Telephone:(345) 949-7500
Facsimile:(345) 949-8258
O'CONNOR PROPRIETARY: Shareholders' Final Meeting Set for Dec. 11
-----------------------------------------------------------------
The shareholders of O'Connor Proprietary Seriescurrencies & Rates,
Fundamental Long/Short and Convertible Arbitrage (Euro) Limited
will meet on December 11, 2008, at 11:30 a.m., to receive the
liquidator's report on the company's wind-up proceedings and
property disposal.
The company's liquidator is:
Stuart Sybersma
Jessica Turnbull, Deloitte & Touche
P.O. Box 1787GT, Grand Cayman
Cayman Islands
Telephone:(345) 949-7500
Facsimile:(345) 949-8258
O'CONNOR VOLATILITY: Shareholders' Meeting Set for December 11
--------------------------------------------------------------
The shareholders of O'Connor Volatility Opportunities Master
Limited will meet on December 11, 2008, at 3:30 p.m., to receive
the liquidator's report on the company's wind-up proceedings and
property disposal.
The company's liquidator is:
Stuart Sybersma
Jessica Turnbull, Deloitte & Touche
P.O. Box 1787GT, Grand Cayman
Cayman Islands
Telephone:(345) 949-7500
Facsimile:(345) 949-8258
O'CONNOR VOLATILITY: Shareholders' Meeting Set for December 11
--------------------------------------------------------------
The shareholders of O'Connor Volatility Opportunities Limited will
meet on December 11, 2008, at 3:00 p.m., to receive the
liquidator's report on the company's wind-up proceedings and
property disposal.
The company's liquidator is:
Stuart Sybersma
Jessica Turnbull, Deloitte & Touche
P.O. Box 1787GT, Grand Cayman
Cayman Islands
Telephone:(345) 949-7500
Facsimile:(345) 949-8258
SCHRADER CAMARGO: Members' Meeting Set for December 12
------------------------------------------------------
The members of Schrader Camargo International Inc will hold their
meeting on December 12, 2008, at 9:30 a.m., to receive the
liquidator's report on the company's wind-up proceedings and
property disposal.
The company's liquidator is:
Jorge Alberto Diaz
Carrera 4, No. 72-35,
Piso 2, Apartado 8090, Bogota, Colombia
===============
C O L O M B I A
===============
BANCOLOMBIA: Sells 67.42% Real Estate Stake for US$ 9.72 Million
----------------------------------------------------------------
Bancolombia S.A. sold its 67.42% stake in a real estate property
(public registry number 060-209429) located in the Chambacu sector
in Cartagena, Colombia.
Bancolombia S.A. sold its real estate interest to CMB S.A. for
Ps. 22,531,764,000 (approximately US$ 9,720,346.85).
Bancolombia also made an in-kind contribution to CMB S.A., of its
rights in the trust Lote Chisa 2C, (the "Trust") which is managed
by Fiduciaria Bancolombia S.A. The Trust's only asset is a real
estate property (public registry number 060-163654), located in
the Chambacu sector in Cartagena, Colombia.
Bancolombia S.A. is Colombia's largest full-service financial
institution, formed by a merger of three leading Colombian
financial institutions. Bancolombia's market capitalization is
over US$5.5 billion, with US$13.8 billion asset base and
US$1.4 billion in shareholders' equity as of Sept. 30, 2006.
Bancolombia is the only Colombian company with an ADR level III
program in the New York S0tock Exchange.
* * *
As reported in the Troubled Company Reporter-Latin America on
June 23, 2008, Moody's Investors Service upgraded to Ba2, stable
from Ba3, positive the foreign-currency deposit ratings assigned
to the two banks it rates in Colombia. This action is the direct
result of Moody's decision to upgrade Colombia's foreign currency
country ceilings for bonds and deposits to Baa3 and Ba2,
respectively.
At the same time, Moody's upgraded Bancolombia's foreign currency
subordinated bond rating to Baa3 from Ba1. The outlook is stable.
EMPRESA DE ENERGIA: Fitch Confirms Issuer Default Rating at 'BB'
----------------------------------------------------------------
Fitch Ratings has affirmed Empresa de Energia de Bogota S.A. ESP's
foreign and local currency Issuer Default Ratings at 'BB'. The
rating action applies to USD610 million of outstanding senior
unsecured notes due 2014. Fitch has also revised EEB's Rating
Outlook to Negative from Stable.
The Negative Outlook reflects the weakening prospects for EEB to
reduce debt leverage over the near to medium term as had been
originally expected. The combination of EEB's aggressive growth
strategy, driven by demand growth, and the unlikely initial public
offering of Transportadora de Gas del Interior S.A. ESP over the
medium term given current international financial market
conditions will likely keep leverage at elevated levels. EEB is
expected to pursue plans to increase investment in natural gas
transportation expansion projects to maintain its leadership
position in its service area. EEB will likely fund a portion of
these potential investments with consolidated on-balance-sheet
cash of USD320 million as of Sept. 30, 2008 (USD81 million at
TGI), as well as debt from third parties. Depending on the size
and timing of these potential capital investments, consolidated
debt to EBITDA could increase by more than 1 time to more than 4x,
which may pressure credit quality.
EEB's leverage is moderate and liquidity is manageable for the
current rating category. As of the last 12 months ended Sept. 30,
2008, the company's consolidated leverage as measured by total
consolidated debt to EBITDA plus dividends received was 3.1x.
During this period, LTM consolidated EBITDA equaled approximately
USD490 million and debt totaled USD1.531 million. Holding company
leverage (excluding TGI's debt and cash flow generation) was
approximately 3.4x and net debt to dividends was 2.2x.
Holding company debt at Sept. 30, 2008 totaled USD780 million,
consisting mainly of the USD610 million notes due 2014 and a
USD100 million loan from Corporacion Andina de Fomento. The vast
majority of the holding company's cash flow is generated from
dividends received from electric investments in Emgesa and
Codensa. Annual dividends to the holding company approximate
USD210 million; TGI does not, and is not expected to pay dividends
to EEB for the foreseeable future. Capital expenditures are
expected to increase, which will pressure credit metrics.
EEB's ratings reflect the company's diversified portfolio of
assets with a generally low business-risk profile and stable and
predictable cash flow generation. EEB's low business-risk profile
stems from its diversified portfolio of energy assets, which for
the most part operate as regulated natural monopolies. EEB owns
non-controlling majority participations in Colombia's largest
electricity generation company as well as in the country's largest
distribution company, which operates in the city of Bogota. The
company also owns a majority participation in TGI, Colombia's
largest natural gas transportation company, which provides gas to
the country's major cities.
All of the company's assets present a strong competitive position,
which bodes well for the company's credit profile. The
electricity and gas distribution and transmission/transportation
businesses are regulated natural monopolies with low risks and
stable cash flow generation. The electricity generation business
in Colombia is considered highly competitive, given the country's
significant low-cost hydroelectric generation and overcapacity.
EEB's energy generation business is also competitively well-
positioned, given its low-cost profile and capacity generation mix
of 88.5% hydro 11.5% thermo.
EEB is exposed to foreign currency exchange rate risk and
regulatory changes in the business. EEB recently swapped its
interest payments on USD133 million of its USD610 million notes to
pesos to partially mitigate its exposure to foreign exchange risk.
Approximately 65% of the company's revenue is linked to USD and
97% of total debt is denominated in U.S. dollars, further
mitigating these risks.
Empresa de Energia de Bogota S.A. ESP is an energy holding
company. The company participates in the Colombian electricity
transmission system where it has a 7.16% market share. EEB also
participates in electricity generation and distribution, as well
as gas transportation and distribution. The company is controlled
by the District Capital of Bogota, which owns 81.5% of the
company.
TRANSPORTADORA DE GAS: Fitch Confirms Issuer Default Ratings at BB
------------------------------------------------------------------
Fitch Ratings has affirmed Transportadora de Gas del Interior S.A.
ESP's (TGI) foreign and local currency Issuer Default Ratings at
'BB' and revised the Rating Outlook to Negative from Stable. The
rating action applies to USD750 million of outstanding senior
unsecured notes due 2017.
The Negative Outlook reflects the weakening prospects for TGI and
for its parent company, Empresa de Energia de Bogota S.A., to
reduce their debt leverage over the near to medium term as
originally expected. The combination of TGI and EEB's aggressive
growth strategy, driven by demand growth, and an unlikely near-
term initial public offering of TGI, given current international
financial market conditions, will likely keep leverage at elevated
levels over the medium term.
TGI's ratings reflect its parent company, Empresa de Energia de
Bogota's, explicit and implicit support. EEB's Rating Outlook has
also been revised to Negative as a result of potential increases
on debt to fund capital investments and increases to leverage.
EEB owns 97.91% of TGI and in turn, the District Capital of Bogota
(rated 'BB+' by Fitch) owns 81.5% of EEB.
TGI's leverage level is high for the assigned rating. The company
reported leverage, as measured by total senior debt to EBITDA as
of the last 12 months ended Sept. 30, 2008 of 4.2 times, excluding
a subordinated intercompany loan from EEB of USD370 million;
leverage is 5.2x including the EEB subordinated loan. At the LTM
ending Sept. 30, 2008, EBITDA was USD215 million. TGI issued
USD750 million of debt during 2007 to finance EEB's acquisition of
Ecogas assets. TGI's covenant package includes a maintenance
covenant stipulating that net debt to EBITDA cannot exceed 4.8x
after 2012. The company is well below this level given the method
by which the ratio is calculated.
Liquidity is satisfactory with virtually all of the debt coming
due 2017. At Sept. 30, 2008, TGI's cash and marketable securities
was USD81 million with USD320 million at the parent company.
Capital expenditures are expected to approximate free cash flow,
limiting debt reductions over the medium term. TGI is not
expected to pay dividends over the medium term and does not have
any derivative exposure. TGI's regulated revenues are partially
indexed to the U.S. dollar which somewhat mitigates the risk from
currency fluctuations.
TGI's ratings also reflect the company's low business-risk profile
resulting from its natural monopolistic position, the low volume-
sensitivity and stability of its revenue and the company's fixed-
payment contract position. The ratings also incorporate the solid
and independent Colombian regulatory framework. TGI's pipeline
location and the importance of its service area, where 70% of the
Colombian population lives, and which represents great growth
potential, help bolster the company's credit profile and credit
rating.
TGI's revenue flow is stable and predictable as approximately 80%
of the revenues are from capacity payments under long-term
contracts with a diversified portfolio of market participants.
The company has low exposure to volume risk. That is, only 20% of
revenue is derived from the volume of gas transported. However,
TGI is somewhat exposed to regulatory risk, as the bulk of its
revenue comes from tariffs set by the regulator. TGI's revenue is
determined by the maximum allowable income set by the regulator
every five years and adjusted by inflation every year. Regulatory
risks, and more specifically the risk of significant reductions in
the company's maximum allowable revenue, are mitigated by the
capital-intensive nature of the gas pipeline transportation
business and the marginal cost that gas transportation represents
relative to overall cost of gas.
Transportadora de Gas del Interior S.A. ESP. is a natural gas
transportation company with 3,702 kilometers (or 2,300 miles) of
pipelines throughout Colombia. The company transported
approximately 49% of the total natural gas volume consumed in
Colombia during 2006. TGI is 98% owned by Empresa de Energia de
Bogota and 2% by minority shareholders.
================================
D O M I N C A N R E P U B L I C
================================
* DOMINICAN REPUBLIC: Business Groups Warn Massive Layoff in 2009
-----------------------------------------------------------------
Four business associations warned last week that if the exports
aren't stimulated there'll be massive layoffs next year, because
exports have plunged more than 60%, The Dominican Today reported.
According to the report, the associations of Free Zones,
Industries, Exporters and Agribusiness (JAD) said their common
interest is that the country can confront the challenges in the
world's new economic order, and to spur development they propose
that exports must be declated a national priority. "We feel that
the crisis affecting the world powers forces us, as a country
dependent on those economies, to urgently adopt the measures
needed to secure a currency income volume, in responce to this
critical moment, to better protect the national productive
system," the associations said.
The report relates the industrialists requested declaring exports
a national priority and to follow a common agenda for that
purpose.
According to Moody's Investors Service, the country continues to
carry a B2 foreign currency rating with a stable outlook, and a B2
local currency rating with stable outlook.
* DOMINICAN REP: Gov't to Inject Dollars to Lower Market Pressure
-----------------------------------------------------------------
The Dominican Republic's central bank will inject between US$50
and US$100 million to the market to ease the monetary policy, The
Dominican reported, citing central banker Hector Valdez Albizu.
The report relates the move is aimed to lower the pressure to
boost the exchange rate, which jumped without monetary or fiscal
reasons.
According to the report, Mr. Albizu clarified that there'll be
neither a fiscal adjustment nor tax increase that wasn't discussed
with the Monetary Fund because the government spending established
in the Budget will be adjusted instead.
Mr. Albizu, as cited by the report, said although next year's
external conditions will be difficult, the economy's solid
foundations and an effective coordination between fiscal and
monetary policy "will let the country navigate turbulent waters."
The official, the report adds, also warned the speculators who are
keeping and accumulating dollars, will be doing bad business
because the government decided to act.
According to Moody's Investors Service, the country continues to
carry a B2 foreign currency rating with a stable outlook, and a B2
local currency rating with stable outlook.
=================
G U A T E M A L A
=================
EMPRESA ELECTRICA: S&P Holds 'BB-' Long-Term Corp. Credit Ratings
-----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB-' local and
foreign currency long-term corporate credit ratings on Empresa
Electrica de Guatemala. The rating was removed from CreditWatch
with negative implications, where it had been placed on Aug. 26,
2008. The outlook is negative.
The ratings were originally placed on CreditWatch with negative
implications following the Electric Energy National Commission in
Guatemala's announcement of the applicable tariffs for the 2008-
2013 period that established a value-added distribution (a
component of the tariff that reimburses the distribution company
for its investment) lower than that which was in force in the
2003-2008 period.
"The negative outlook reflects deterioration in EEGSA's
profitability and the uncertainty of further weakening in its key
financial indicators during 2009 and beyond. S&P expects the FFO-
to-total debt and FFO-to-interest coverage ratios to decrease to
27% and 3.5x, respectively, during 2009; however, S&P believes the
company will generate sufficient internally generated cash flow to
finance continuing operations and expected capital expenditures,"
said S&P's credit analyst Marcela Duenas.
The rating considers the inherent challenges associated with the
business operating environment in the Republic of Guatemala (FC:
BB/Stable/B; LC: BB+/Stable/B) and the discretionary role of CNNE
in the setting of tariffs. The rating also considers the power
sector's dependence on a developing economy, which may be
adversely affected in times of economic stress. In addition, the
rating incorporates the company's limited financial flexibility,
given the undeveloped capital markets in Guatemala, compared with
distribution companies operating in countries with more advanced
financial markets. Finally, EEGSA's natural monopoly and
management's experience and success in Latin America support the
rating.
"The negative outlook reflects the potential for further weakening
in EEGSA's key financial indicators -- especially its
profitability -- that will mostly depend on EEGSA's efficiency and
on electricity demand. A downgrade could occur if the company's
liquidity and cash flow protection measures deteriorate even
further. The outlook could be revised to stable if EEGSA can
reverse the negative effects of VAD reductions and post an FFO-to-
total debt ratio of around 33%," Ms. Duenas added.
Senior Secured Floating-Rate Notes
=============
J A M A I C A
=============
JAMAICA PRODUCERS: Cuts 200 Jobs in UK Unit Due to Losses
---------------------------------------------------------
Jamaica Producers Group Limited will cut up to 200 jobs in its
United Kingdom fruit juice manufacturer as part of the proposed
restructuring plan, Radio Jamaica reports.
The report relates that Serious Food Company in South Wales has
been operating at a significant loss.
According to the report, Jamaica Producers said the restructuring
is intended to allow the company to operate with substantially
lower fixed costs and to respond effectively to adverse economic
conditions in the UK.
A number of management, clerical and production positions are at
risk of being slashed and consultation will be held with employees
who are likely to be affected, the report says.
As reported by the Troubled Company Reporter - Latin America on
November 26, 2008, Jamaica Producers Group's posted a US$1.1
billion loss in the 40 weeks ended October 4 from a US$326 million
loss during the corresponding period last year.
Jamaica Producers attributed its loss during the third quarter to
the deteriorating economic conditions in the United Kingdom and
Europe, which are its primary markets, and the passing of the
tropical Storm Gustav and the restructuring charges to incurred
losses.
About Jamaica Producers
Jamaica Producers Group Limited -- http://www.jpjamaica.com/ --
is engaged in juice and food manufacturing and distribution, the
cultivation, marketing and distribution of bananas locally and
overseas, shipping and the holding of investments. The company is
organized into three business segments: Banana Division, which
comprises the growing, sourcing, ripening, marketing and
distribution of bananas, and the operation of a shipping line that
inter alia transports bananas to the United Kingdom; Fresh &
Processed Foods Division, which comprises the production and
marketing of fresh juices, drinks, and other freshly prepared
foods and tropical snacks, and Corporate segment. The Fresh &
Processed Foods Division consists of the company's prepared foods
businesses in juice, smoothies, desserts, soups and ready meals,
chilled distribution and tropical snack foods.
* JAMAICA: Revenue Collection Declines
--------------------------------------
Inflows into Jamaica's coffers have been US$8 billion behind
projection, Radio Jamaica reports, citing data from the Ministry
of Finance.
The report relates for the period April to October, US$159 billion
was projected to be collected, however, US$151 billion came in.
The biggest decline, the report says, was seen in tax revenue down
US$6.4 billion and the bauxite levy which was US$1.5 billion less
than expected.
According to Radio Jamaica, breakdown of the figures shows General
Consumption Tax was the main area that was hit.
Collection was down US$3.6 billion during the seven month period.
Financial observers have warned that the downturn in the local
economy combined with the global financial meltdown will have a
severe impact on the Government's revenue target for the 2008/2009
fiscal year, the report notes.
Radio Jamaica adds that the Government is keeping its fingers
crossed that it will be able to obtain the US$250 million needed
to close the fiscal gap, despite the challenging global economic
conditions.
Jamaica is an island nation of the Greater Antilles, 234
kilometers in length and as much as 80 kilometers in width
situated in the Caribbean Sea. It is about 145 kilometers south
of Cuba, and 190 kilometers west of the island of Hispaniola, on
which Haiti and the Dominican Republic are situated. According to
Moody's Investor Site, the country continues to hold a B1 foreign
currency rating and a Ba2 local currency rating.
* JAMAICA: Signs US$500 Mil. Deal with IDB to Support Local Banks
-----------------------------------------------------------------
Government of Jamaica and Inter-American Development Bank signed a
US$500 million liquidity support programme for commercial banks,
Jamaica Gleaner reports, citing Don Wehby, Minister without
Portfolio in the finance ministry.
Mr. Wehby, the report relates, said the agreement would allow for
local financial institutions to access money to be offered in
loans for the productive sector. The opportunity to access money
from international institutions had dried up because of the global
financial crisis, he said.
According to the report, the first disbursement of US$300 million
would be made very early in the new year.
Meanwhile, the report states the Senate has approved a resolution
to increase the loan ceiling from $700 billion to $920 billion to
help the Government fulfill its programmed borrowing in the medium
term.
However, the Gleaner notes opposition Senator Mark Golding said
the need to increase the loan ceiling indicated a serious concern
with the debt problem in Jamaica.
"The country is definitely struggling with the debt that it's
carrying," the report cited Mr. Golding as saying. "Jamaica is
probably going to be more challenged than any of its Caribbean
neighbours to deal with the economic times that we are facing.
Jamaica is an island nation of the Greater Antilles, 234
kilometers in length and as much as 80 kilometers in width
situated in the Caribbean Sea. It is about 145 kilometers south
of Cuba, and 190 kilometers west of the island of Hispaniola, on
which Haiti and the Dominican Republic are situated. According to
Moody's Investor Site, the country continues to hold a B1 foreign
currency rating and a Ba2 local currency rating.
===========
M E X I C O
===========
PILGRIM'S PRIDE: Files for Chapter 11 Bankruptcy in Texas
---------------------------------------------------------
Pilgrim's Pride Corporation together with certain of its wholly
owned subsidiaries filed voluntary petitions for relief under
Chapter 11 of the United States Bankruptcy Code in the United
States Bankruptcy Court for the Northern District of Texas
in an effort to address certain short-term operational and
liquidity challenges.
Richard A. Cogdill, chief financial officer of Pilgrim's Pride,
relates that over the past 12 months, the underlying economics of
the poultry industry have deteriorated dramatically.
Profitability in the chicken industry is materially affected by
the commodity prices of feed ingredients. The cost of corn and
soybeans, the company's primary feed ingredients, increased
significantly over the past year as a result of, among other
things, increasing demand for these products around the world and
because of the passage of the Energy Independence and Security Act
of 2007. That act requires a gradual increase in the production
of biofuels, including ethanol from nine billion gallons in 2008
to 36 billion gallons by 2022.
As a result, the demand for, and price of, corn has increased.
The price of corn has historically been in the US$2 to US$3 per
bushel range, but rose as high as US$7.65 per bushel in late June
of 2008, resulting in significantly higher feed expenses for the
company which in turn, contributed to significant financial
losses. The company's attempt to hedge their feed ingredients
costs against an increase in commodity prices during the fourth
quarter of fiscal year 2008 resulted in increased losses when the
price of corn abruptly reversed course from its record highs and
began to decline in July and throughout the remainder of the
summer and into the fall of 2008.
The company related that the cost of energy has also significantly
increased. The company operates almost three dozen processing
plants and their infrastructure includes production and
manufacturing equipment, as well as associated transportation
delivery costs. The company said it is necessary for the it to
allocate more of their budget to fund fuel and other energy costs
to ensure the smooth functioning of the the company's operations
due to higher energy prices.
In addition to the increases in the cost of feed ingredients and
the cost of energy, the supply of chicken products has continued
to exceed profitable demand, leading to an oversupply in the
industry. Further, in addition to increased competition from
other meat proteins as these meat proteins liquidated livestock to
mitigate the adverse effects of soaring feed ingredient costs, the
U.S. chicken industry, like others has been negatively
affected by the downturn in the nation's economy. This has
resulted in reduced demand for chicken products in general,
including Pilgrim's Pride's products, and has made it more
difficult for the Debtors to increase product pricing to offset
their higher costs for feed and energy. The company stated that
market pricing for chicken breast meat during the summer
months -- historically a time of peak demand -- proved much
weaker than expected in the summer of 2008.
In the months prior to the bankruptcy filing, the Debtors
considered various out-of-court restructuring alternatives. They
retained Bain Corporate Renewal Group, LLC and Lazard Freres & Co.
LLC to work as their advisors in connection with operational and
balance sheet restructuring alternatives. In November 2008, PPC
also appointed William K. Snyder, managing partner of CRG Partners
Group, LLC, as chief restructuring officer to assist the company
in capitalizing on cost reduction initiatives, developing
restructuring plans, and exploring opportunities to improve PPC's
long-term liquidity. However, due to the worldwide credit crisis,
no viable out-of-court balance sheet restructuring alternative
materialized. As the Debtors' liquidity position continued to
worsen, and the end of the waiver period granted by lenders
approached, the Debtors determined that the only method to protect
the interests of all stakeholders was to seek protection under the
Bankruptcy Code.
The company's operations are expected to continue as normal
throughout the bankruptcy process while it develops a
reorganization plan to resolve its temporary operational and
liquidity issues. According to the company, its operations
in Mexico and certain operations in the United States were not
included in the filing and will continue to operate outside of the
Chapter 11 process.
Capital Structure
The company said it had approximately US$224.9 million in general
unsecured claims as of Nov. 24, 2008. In addition, the company
said it is the issuer of notes under three indentures aggregating
approximately US$657 million in unsecured indebtedness.
According to the company, its primary sources of funding are:
i) a revolving credit facility, dated as of Feb. 8, 2007, as
amended and restated, by among others, the company and its
affiliates To-Ricos, Ltd. and To-Ricos Distribution, Ltd.,
and Bank of Montreal, Chicago Branch administrative agent;
and
ii) revolving credit facility and term loan dated Sept. 21,
2006, as amended and restated, by among others, the company
and CoBank ACB, as administrative agent, and the other
agents and syndication parties signatory thereto.
The BMO Credit Agreement provides for a revolving credit
facility of US$300 million and is secured by all inventory and
farm products whether now owned or existing or hereafter created,
including all claims and rights of the company against any of its
growers. The agreement matures on Feb. 8, 2013. The company said
Pilgrim Interests, Ltd., an entity controlled by Lonnie Pilgrim
and his family, is a guarantor with respect to 50% of the
obligations under the agreement. As of Nov. 28, 2008, the
aggregate principal amount outstanding under the BMO Agreement
was approximately US$311 million.
The CoBank Credit Agreement provides for a revolving credit
facility of US$550 million and a term loan of US$750 million
secured by all of the company's real property interests,
furniture, fixtures and equipment located at, or used in
connection with, the poultry hatching, raising, slaughtering,
processing, packaging, and shipping operations and facilities.
The agreement matures on Sept. 16, 2011. Pilgrim Interests, Ltd.
is a guarantor under the agreement with respect to 50% of the
obligations of the company. As of Nov. 28, 2008, the aggregate
principal amount outstanding was US$1.127 billion under the
agreement.
Amended and Restated Receivables Purchase Agreement
The company said it is also party to (i) an Amended and Restated
Receivables Purchase Agreement dated Sept. 26, 2008, by and among
the company and a non-debtor subsidiary, Pilgrim's Pride Funding
Corporation, BMO Capital Markets Corp. and various purchasers; and
(ii) a Purchase and Contribution Agreement dated June 26, 2008, by
and between the company and its non-debtor unit. On the one hand,
under the Purchase and Contribution Agreement routinely sells a
pool of accounts receivable from customers, on a revolving basis,
to Pilgrim's Pride Funding and, on the other hand, under the
Amended and Restated Receivables Purchase Agreement, PPFC then
sells undivided interests in the receivables to an outside
conduit, which has committed, under certain circumstances and
subject to certain conditions, to purchase undivided interests in
those receivables.
The company said it retains servicing responsibility over
servicing all receivables subject to the Amended and Restated
Receivables Purchase Agreement. The Amended and Restated
Receivables Purchase Agreement also, among other things, gives BMO
Capital Markets certain control over lock-box and collection
accounts established in connection with the agreement, the company
noted. As of Nov. 28, 2008, the aggregate principal amount
outstanding under the Amended and Restated Receivables Purchase
Agreement was approximately US$224.9 million, the company adds.
Notes and Debt Securities
The company stated that it is the issuer under three indentures:
i) approximately US$400 million 7 5/8% Senior Notes due May 1,
2015;
ii) approximately US$250 million aggregate principal amount
outstanding of 8 3/8% Senior Subordinated Notes due May 1,
2017; and
iii) approximately US$6.996 million aggregate principal amount
outstanding of 9 1/4% Senior Subordinated Notes, due
Nov. 15, 2013.
According to the company, None of its subsidiaries is a guarantor
under any of the Notes. The company said that the Senior Notes
are its unsecured senior obligations and rank equally with all of
its other senior indebtedness and are effectively subordinated to
its existing and future secured obligations and to the
indebtedness of its subsidiaries. In addition, the Subordinated
Notes are the company's unsecured senior subordinated obligations
which are subordinated to its senior obligations and are
effectively subordinated to its existing and future secured
obligations and the indebtedness of its subsidiaries. The Senior
Subordinated Notes rank pari passu with the Subordinated Notes,
the company noted.
Industrial Revenue Bond Debt
The company said it is a number of lease agreements backing
certain Industrial Revenue Bonds issued by various municipalities.
The IRBs were issued to fund construction of facilities in these
municipalities, which in turn were leased to the company. The
lease payments on the facilities satisfy the amounts due on the
bonds. As of its bankruptcy filing, the company had at least
US$39.2 million outstanding pursuant to IRBs held by third
parties.
Common Stock
The company further said that it had over 74 million shares of
common stock outstanding. Through two limited partnerships and
related trusts and voting agreements, Lonnie Pilgrim, his wife
Patricia Pilgrim, and his son, Lonnie Ken Pilgrim, control 62.225%
of the voting power of the company's outstanding stock.
"Over the past year, Pilgrim's Pride has faced a number of
significant challenges including high feed-ingredient costs, an
oversupply of chicken, weak market pricing and softening demand,"
said Clint Rivers, president and chief executive officer. "After
careful consideration of all available alternatives, the company's
Board of Directors determined that a Chapter 11 filing was a
necessary and prudent step and the best way to obtain the
financing necessary to maintain regular operations and allow for a
successful restructuring. We expect to emerge from this
restructuring a stronger, more competitive company that is well
positioned for growth and enhanced profitability. We are proud of
the consistently high quality of our products, our valued customer
relationships and the high level of service we provide."
In conjunction with the filing, the company is seeking approval to
enter into aUS$450 million debtor-in-possession financing facility
arranged by Bank of Montreal as lead agent. If approved by the
Court, the DIP Financing will provide an immediate source of funds
to the Company, enabling it to satisfy the customary obligations
associated with the daily operation of its business, including the
timely payment of employee wages and other obligations.
Moreover, the company has asked the Court for additional
authorizations, including permission to continue paying employee
wages and salaries, to provide employee benefits without
interruption, and to continue with its various customer programs.
The company said suppliers should expect to be paid for
post-petition purchases of goods and services in the ordinary
course of business during the Chapter 11 process.
"On behalf of the entire management team, I would like to thank
our customers and suppliers for their continued support during
this process. I also want to recognize our dedicated employees,
whose continued support and commitment are crucial to the future
success of our company. We are all dedicated to making this
financial restructuring a success," Mr. Rivers concluded.
About Pilgrim's Pride
Headquartered in Pittsburgh, Texas, Pilgrim's Pride Corporation
(NYSE: PPC) -- http://www.pilgrimspride.com/-- produces,
distributes and markets poultry processed products through
retailers, foodservice distributors and restaurants in the U.S.,
Mexico and in Puerto Rico. In addition, the company owns 34
processing plants in the United States and 3 processing plants
n Mexico. The processing plants are supported by 42 hatcheries,
31 feed mills and 12 rendering plants in the United States and 7
hatcheries, 4 feed mills and 2 rendering plants in Mexico.
Moreover, the company owns 12 prepared food production facilities
in the United States. The company employs about 40,000
people and has major operations in Texas, Alabama, Arkansas,
Georgia, Kentucky, Louisiana, North Carolina, Pennsylvania,
Tennessee, Virginia, West Virginia, Mexico and Puerto Rico, with
other facilities in Arizona, Florida, Iowa, Mississippi and Utah.
* * *
As reported in the Troubled Company Reporter on Sept. 29, 2008,
Standard & Poor's Ratings Services lowered its ratings on
Pilgrim's Pride Corp., including its corporate credit rating to
'CCC+' from 'BB-'. In addition, S&P revised the CreditWatch
implications to developing from negative.
Moody's Investors Service lowered the ratings of Pilgrim's Pride
Corporation, including: (i) corporate family rating to B2 from
B1; (ii) probability of default rating to B2 from B1; (iii)
$400 million 7.625% senior notes due 2015 to Caa1 from B3 and
(iv)US$250 million senior subordinated notes due in 2017 and
$5.1 million (originalUS$100 million) senior subordinated notes
due 2013 to Caa1 from B3
PILGRIM'S PRIDE: Lines Up US$450MM. DIP Loan from Bank of Montreal
------------------------------------------------------------------
Pilgrim's Pride Corporation and its debtor affiliates ask the
United States Bankruptcy Court for the Northern District of Texas
Fort Worth Division for approval to obtain US$450 million of
debtor-in-possession financing from Bank of Montreal as lead
agent.
Richard A. Cogdill, chief financial officer of Pilgrim's Pride,
relates that the proposed financing will be senior to all
obligations under (i) the BMO Agreement, of which US$311 million
is owed to Bank of Montreal, Chicago Branch administrative agent,
and other lenders and (ii) the CoBank Agreement, under which
US$1.27 billion is outstanding and owed t CoBank ACB, as
administrative agent, and the other agents and syndication parties
signatory thereto. As such, the liens created pursuant to this
financing arrangement are priming liens with respect to liens
currently held by the BMO Lending Group and the CoBank Lending
Group.
Prior to the commencement of the Debtors' chapter 11 cases, the
Debtors and Lazard Freres & Co. LLC, the Debtors' financial
advisors, surveyed various sources of postpetition financing,
including financing from the Prepetition Lenders and unrelated
third parties. The Debtors and Lazard approached various other
parties having the capability of providing a facility of the size
required, including the proposed DIP Lenders. Although they
approached several parties, they were only able to solicit
proposals from two parties who indicated interest in providing
postpetition financing and provided concrete pricing and structure
proposals.
In exploring their options, the Debtors recognized that the
obligations owed to the Prepetition Lenders are secured by
substantially all of the Debtors' real and personal
property, such that either (i) the liens of the Prepetition
Lenders would have to be primed to obtain postpetition financing,
or (ii) the Debtors would have to find a postpetition lender
willing to extend credit that would be junior to the liens of the
Prepetition Lenders. Indeed, each of the proposals the Debtors
received required liens priming those of the Prepetition Lenders.
The Prepetition Lenders advised the Debtors that they would not
grant a blanket consent to be primed by another lender group;
however, a subset of the Prepetition Lenders indicated a
willingness to negotiate terms of a postpetition financing
facility the Debtors believed other Prepetition Lenders
would find acceptable.
The Debtors are seeking authorization to enter into the DIP Credit
Agreement on an interim basis pending a final hearing. Based on
their cash needs during the interim period and the inherent
uncertainties in collection of accounts receivable, the Debtors
have determined that during the interim period and until the Final
Order is entered, they will need to borrow from the DIP Lenders
approximately US$365 million. The availability of the Interim DIP
Loan will not only ease the Debtors' liquidity constraints beyond
access to the cash collateral, but will allow the Debtors to
satisfy the aggregate principal amount outstanding under the
Amended and Restated Receivables Purchase Agreement. The A/R
Takeout will enable the receivables that have been sold pursuant
to the Amended and Restated Receivables Agreement to be
repurchased by the Debtors. Without the A/R Takeout, the Debtors'
liquidity and access to funds under the DIP Facility will be
negatively impacted.
Availability under the DIP Facility is determined by a borrowing
base consisting of eligible receivables. By repurchasing the
accounts receivables subject to the Amended and Restated
Receivables Agreement, the Debtors, therefore, increase their
access to funds available under the DIP Facility and as a result,
improve liquidity. Moreover, upon the repurchase of the
receivables subject to the Amended and Restated Receivables
Agreement, these receivables will become assets of the Debtors'
estate, Mr. Cogdill explains.
Ultimately, the DIP Lenders, who comprise certain of the
Prepetition Lenders, were willing to extend postpetition financing
on the terms and conditions described in the Motion, including
pricing and fee structure more favorable, in the aggregate, than
any alternative proposal. Moreover, nonparticipating Prepetition
Lenders have consented to the provisions of the proposed DIP
financing.
In order to address their working capital needs and fund their
reorganization efforts, the Debtors also require the use of cash
collateral of the Prepetition Lenders. Coupled with the proceeds
of the DIP Credit Facility, the use of Cash Collateral will
provide the Debtors with necessary additional capital to operate
their businesses, pay their employees, maximize value, and
successfully reorganize under chapter 11. The proposed financing
includes adequate protection in the form of replacement liens and
other payments to the Prepetition Lenders for use of the Cash
Collateral.
Mr. Codgill avers that the credit provided under the DIP Credit
Facility and the use of Cash Collateral will enable the Debtors to
continue to satisfy their customers' needs, provide customer care
and marketing services, pay their employees, and operate their
businesses in the ordinary course and in an orderly and reasonable
manner to preserve and enhance the value of their estates for the
benefit of all parties in interest. The availability of credit
under the DIP Credit Facility will provide confidence to the
Debtors' creditors that will enable and encourage them to continue
their relationships with the Debtors. Finally, the implementation
of the DIP Credit Agreement will be viewed favorably by the
Debtors' employees, customers and vendors, thereby promoting a
successful reorganization.
PILGRIM'S PRIDE: Case Summary & 50 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Pilgrim's Pride Corporation
P.O. Box 93
Pittsburg, Texas 75686
Tel: (800) 824-1159
Bankruptcy Case No.: 08-45664
Debtor-affiliates filing separate Chapter 11 petitions:
Entity Case No.
------ --------
PFS Distribution Company 08-45661
PPC Transportation Company 08-45665
To-Ricos, Ltd. 08-45669
To-Ricos Distribution, Ltd. 08-45670
PPC of West Virginia, Inc. 08-45673
PPC Marketing, Ltd. 08-45676
Type of Business: The Debtors produces, distributes and markets
poultry processed products through retailers,
foodservice distributors and restaurants in the
U.S., Mexico and in Puerto Rico. In addition,
the company owns 34 processing plants in the
United States and 3 processing plants in Mexico.
The processing plants are supported by 42
hatcheries, 31 feed mills and 12 rendering
plants in the United States and 7 hatcheries, 4
feed mills and 2 rendering plants in Mexico.
Moreover, the company owns 12 prepared food
production facilities in the United States. The
company employs about 40,000 people and has
major operations in Texas, Alabama, Arkansas,
Georgia, Kentucky, Louisiana, North Carolina,
Pennsylvania, Tennessee, Virginia, West
Virginia, Mexico and Puerto Rico, with other
facilities in Arizona, Florida, Iowa,
Mississippi and Utah.
See: http://www.pilgrimspride.com/
Chapter 11 Petition Date: December 1, 2008
Court: Northern District of Texas
Debtor's Counsel: Stephen A. Youngman, Esq.
Weil, Gotshal & Manges LLP
200 Crescent Court, Suite 300
Dallas, Texas 75201
Tel: (214) 746-7700
Special Counsel: Baker & McKenzia LLP
Investment Bankers: Lazard Freres & Co. LLC
Chief Restructuring Officer: CRG Partners Group LLC
Claims and noticing agent: Kurztman Carson Consulting LLC
Total Assets:US$3,751,759,571 as of Sept. 27, 2008
Total Debts:US$2,718,971,294 as of Sept. 27, 2008
The Debtor's Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Wells Fargo 7.625% Senior US$15,250,000
Attn: Patrick Giordano Notes, Due May 1
1445 Ross Avenue 2015
2n Floor
Dallas, TX 75202
Tel: (214) 740-1573
Fax: (214) 777-4086
Wells Fargo 8.375% Senior US$10,468,750
Attn: Patrick Giordano Notes, Due May 1
1445 Ross Avenue 2017
2n Floor
Dallas, TX 75202
Tel: (214) 740-1573
Fax: (214) 777-4086
International Paper Inc. trade debt US$6,087,998
Attn: Don Washington
PO Box 676565
Tel: (901) 413-6244
Fax: (318) 994-6275
Tom Wade Companies trade debt US$2,611,942
In Care of Vendor Relations
PO Box 133
347 South Main
Dyer, TN 38330
Tel: (731) 692-3677
Aviagen Inc. trade debt US$2,048,311
Attn: Shannon Burasco
5015 Bradford Dr.
Huntsville, AL 35805
Tel: (479) 524,4718
Fax: (256) 890-3895
Southern Hens Inc. trade debt US$1,987,369
PO Box 8000
329 Moselle-Seminary Road
Moselle, MS 39459
Tel: (601) 582-2262
Fax: (601) 584-4747
Novus International Inc. trade debt US$1,712,830
Attn: Shawn Atkins
20 Research Park Drive
St. Charles, MO 63304
Tel: (314) 576-8886
Fax: (314) 576-6499
Cargill Inc. trade debt US$1,450,950
Attn: John Coffelt
PO Box 841674
Dallas, TX 75284
Tel: (952) 742-4590
Fax: (316) 264-8798
CR England & Sons Inc. trade debt US$1,349,990
Attn: Mike Bunnell
PO Box 52888
Phoenix, AZ 86072
Tel: (801) 974-3246
Fax: (801) 977-6623
Elkhart Grain trade debt US$1,290,843
Attn: Don Ludwig
PO Box 216
Elkhart, IL 62634
Tel: (217) 947-2751
Fax: (217) 947-2942
Trouw Nutrition USA LLC trade debt US$1,282,936
Attn: David Bradham
PO Box 219
115 Executive Drive
Highland, IL 62249
Tel: (864) 226-0384
Fax: (618) 654-6700
Kokomo Grain Company Inc. trade debt US$1,278,704
Attn: Tom Madru
PO Box 745
1002 W. Morgan Street
Kokomo, NY 46903
Tel: (765) 457-7536
Fax: (765) 456-1207
Cobb Vantress Inc. trade debt US$1,214,041
Attn: Heath Wessels
PO Box 1030
Siloam Springs, AR 72761
Tel: (479) 524-3166
Fax: (479) 549-2860
Newly Weds Foods Inc. trade debt US$1,160,191
Attn: Loy Shaw
PO Box 95056
150 S. Wacker Drive, Ste. 3200
Chicago, IL 60606
Tel: (214) 683-4299
Fax: (479) 756-5211
Demeter LP trade debt US$1,067,710
Attn: Bob Seegerss Jr.
23619 Route 173
Harvard, IL 60033
Tel: (815) 459-1600
Fax: (815) 943-5132
Airgas Dryice trade debt US$1,018,345
Attn: Phil Filer
6340 Sugar Loaf Pkwy.
Suite 300
Duluth, GA 30097
Tel: (770) 717-2200 ext. 114
Fax: (877) 212-6081
Ecolab trade debt US$799,887
Attn: Dan Siegler
PO Box 905327
Charlotte, NC 28290
Tel: (651) 261-0075
Fax: (651) 293-2069
Motion Industries Inc. trade debt US$799,887
Attn: Gerald Siegler
PO Box 9055327
Charlotte, NC 28290
Tel: (205) 951-1195
Fax: (205) 951-1580
Illes Company Inc. trade debt US$694,349
Attn: Rick Illes
PO Box 35412
5527 Redfield St.
Dallas, TX 75235
Tel: (214) 689-1304
Fax: (214) 951-9625
Alpharma Inc. trade debt US$674,130
Attn: Travis Goodner
440 RT 2E
Bridgewater, NJ 08807
Tel: (936) 564-4328
Fax: (908) 566-4137
Elanco Animal Health trade debt US$656,429
Attn: Bryana Clover
PO Box 121020
Dallas, TX, 75312
Tel: (903) 216-2812
Fax: (317) 276-9434
PCS Sales (USA) Inc. trade debt US$645,621
Attn: Shane Williams
PO Box 71029
Chicago, IL 60694
Tel: (847) 849-4381
DeGussa-Huls Corporation trade debt US$612,538
Attn: Joe Parsley
65 Challenger Road
Ridgefield Park, NJ 07660
Tel: (479) 986-0720
Fax: (201) 807-3183
JM Swank Company Inc. trade debt US$604,397
Attn: Rond Pardekooper
395 Herky Street
North Liberty, IA 52317
Tel: (800) 593-6375
Fax: (402) 516-0639
Lease Plan USA Inc. equipment lease US$603,495
In Care of Vendor Relations
PO Box 930927
Atlanta, GA 31193
Tel: (770) 933-9090
Fax: (678) 202-8700
Advantage Packaging & Paper trade debt US$562,745
Attn: Mike Chisholm
4019 Lake Brazos Lane
Richmond, TX 77406
Tel: (281) 413-0987
W C Rice Oil Co. Inc. trade debt US$554,670
Attn: Joe Fields
2511 28th St. SW
Birmingham, AL 35211
Tel: (205) 795-2814
Fax: (205) 648-0213
RFW Construction Group trade debt US$532,600
Attn: Larry Rogers
PO Box 1206
1801 Hwy. 51 Bypass N.
Dyersburg, TN 38024
Tel: (731) 286-5661
Fax: (731) 286-4564
Millard Refrigerated Service trade debt US$490,403
Attn: Mark Conklin
4715 South 132nd St.
Omaha, NE 68137
Tel: (817) 626-2800
Fax: (601) 936-6330
Colormaster LLC trade debt US$488,167
Attn: Ben Fryer
PO Box 2289
632 Smith Road
Albertvivlle, AL 35950
Tel: (256) 572-3735
Fax: (256) 878-8835
OK Foods Inc. trade debt US$465,102
PO Box 1787
4601 N. 6th St.
Fort Smith, AR 72902
Tel: (501) 783-4186
Fax: (501) 784-1135
Flint River Services Inc. trade deb US$460,176
Attn: Zack Aultman
PO Box 50065
1019 Worth St.
Albany, GA 31703
Tel: (229) 883-1912
Fax: (229) 883-2301
McCormick & Company Inc. trade debt US$452,396
Attn: Phil Kafarakis
211 Schilling Circle
Hunt Valley, MD 21-31
Tel: (410) 771-7453
Fax: (972) 579-7308
Alatrade Foods LLC trade debt US$448,393
Attn: Dale Carroll
725 Blount Avenue
Guntersville, AL 35976
Tel: (256) 593-3152
Fax: (256) 571-9977
KLLM Inc. trade debt US$445,194
Attn: Tood Gooch
134 Riverview Drive
Richland, MS 39218
Tel: (866) 475-1036
Fax: (770) 983-7116
Kennesaw Transportation Inc. trade debt US$444,351
Attn: Coy Parker
PO Box 249
White, GA 30184
Tel: (800) 443-0768 ext. 1214
Fax: (770) 382-3011
Hubbard Farms Inc. trade debt US$434,154
Attn: Gary Warren
PO Box 10065
Uniondale, NY 11555
Tel: (479) 750-1531
Fax: (423) 447-6661
Southern Refrigerated Inc. trade debt US$433,432
Attn: Rodney Danley
8055 Hwy. 67 N.
Texarkana, AR 71854
Tel: (888) 778-8190
Fax: (870) 216-4170
Hood Packaging Corporation trade debt US$427,144
Attn: Brian Steinwagner
1887 Gateway Blvd.
Arden Hills, MN 55347
Tel: (612) 718-7155
Fax: (601) 833-9354
Key Equipment Finance trade debt US$424,690
Division
PO Box 1865
Albany, NY 12201
Tel: (800) 746-2436
Fax: (800) 800-3671
C.H. Robinson Worldwide Inc. trade debt US$410,776
Attn: Paul Moline
14701 Charson Road
Eded Prairie, MN 55347
Tel: (800) 580-3385
Fax: (224) 224-1801
John R. White Company Inc. trade debt US$402,248
Attn: Brian Smith
PO Box 10043
3701 8th Avenue N.
Birmingham, AL 35222
Tel: (205) 595-8381
Fax: (205) 595-8386
Kerry Specialty Ingredients trade debt US$388,042
Attn: Kevin Williams
PO Box 409141
Tel: (972) 516-1814
Fax: (608) 363-1598
Integral Texas Pallet trade debt US$378,503
Operations
Attn: Randy Womack
6829 Flintlock Road
Houston, TX 77040
Tel: (210) 917-6624
Fax: (713) 674-3492
DST Transportation trade debt US$367,423
Attn: Deborah Shope
2565 Thompson BR Rd.
Suite 110
Gainsville, GA 30501
Tel: (800) 895-9088
Fax: (770) 532-0027
Specialty Industries Inc. trade debt US$250,225
Attn: Lloyd Cunningham
8685 Grand Ledge Hwy.
Sunfield, MI 48890
Tel: (517) 566-7251
Fax: (517) 566-7314
Polytec Inc. trade debt US$348,490
Attn: Martin Guthrie
PO Box 659
191 Barley Park
Mooresville, NC 28115
Tel: (704) 660-5195
Fax: (704) 662-3498
Atlas Cold Storage USA trade debt US$347,913
Attn: Stan Chatlen
North York, Ontario
M2N 5P8
Tel: (678) 432-6729
Fax: (416) 225-2353
Ivesco Holdings LLC trade debt US$339,791
Attn: Drew Weir
124 Country Club Rd.
Iowa Falls, IA 50126
Tel: (479) 717-1840
Fax: (479) 717-1836
Bank of New York Mellon 9.25% Senior US$323,565
Attn: Alma Burgess Subordinated
Towermarc Plaza Notes, Due Nov.
101161 Centurion Parkway 15, 2013
Jackonsville, FL 32256
Alma Burgess
601 Travis St.
16th floor
Houston, TX 77002
Tel: (713) 216-5969
Fax: (712) 483-6959
Ryder
Attn: Kevin P. Sauntry
6000 Windward Pkwy.
Alpharetta, GA 30005
Tel: (770) 569-6511
Fax: (314) 298-3814
The petition was signed by chief financial officer Richard A.
Cogdill.
=================
V E N E Z U E L A
=================
PDVSA: Ecuador President Says Venezuela Committed to Refinery
-------------------------------------------------------------
Ecuador President Rafael Correa denied rumors that Venezuela will
back-out on its planned joint venture with Refineria del Pacifico,
a joint petrochemical project being undertaken by Quito and
Caracas, TMC News reported on November 30.
As reported in the Troubled Company Reporter - Latin America,
Associated Press said according to PDVSA VP Elogio Del Pino,
Petroleos de Venezuela S.A. (PDVSA) is reevaluating how to pay for
the two refineries it planned to build for political allies,
Ecuador and Nicaragua. The two refinery could cost the company
about US$7.5 billion or more.
The AP related Mr. Del Pino said PDVSA is looking for financing to
help pay for the refineries. The planned refinery in Ecuador
would refine about 300,000 barrels of crude per day, while the
Nicaraguan refinery would handle some 150,000 barrels.
According to Oil & Gas Journal, work on the joint-stock Refineria
del Pacifico, held 51% by Ecuador's state-owned Petroecuador and
49% by PDVSA, is scheduled to start in 2010 and operations are
expected to begin by 2013.
Petroecuador Chief Luis Jaramillo, for his part, TMC News notes,
said Quito would not halt the refinery's construction because it
did not want to remain "condemned to continuing to subsidize
petroleum derivatives." If Venezuela pulled out of the project,
Petroecuador would present other options for financing the project
to President Correa, he said.
"We have very good offers from China, Korea, Japan ... The project
is not going down because Venezuela says no," Mr. Jaramillo was
quoted by TMC as saying.
In September, The Journal recounts, reports said PDVSA and
Petroecuador would jointly finance just under one-third of the
estimated US$6-10 billion cost of the Ecuadorian refinery,
expecting that the outstanding amount would be financed by other
countries.
Carlos Albuja, head of Petroecuador unit Petroindustrial, said the
two state firms would "finance 30% of the cost. Countries such as
England and China, among others, are interested in financing the
remainder," the Journal says.
About Petroleos de Venezuela
Headquartered in Caracas, Petroleos de Venezuela S.A. --
http://www.pdvsa.com/-- is Venezuela's state oil company in
formed to develop the petroleum, petrochemical and coal industry.
The company also plans, coordinates, supervises and controls the
operational activities of its divisions, both in Venezuela and
abroad. The company has a commercial office in China.
* * *
Petroleos de Venezuela S.A. continues to carry a 'BB-' long-term
corporate credit rating from Standard & Poor's with stable
outlook. The rating was affirmed by S&P in April 2008.
===============
X X X X X X X X
===============
* Detroit Three In Talks With Union to Stop Idled Worker Payment
----------------------------------------------------------------
General Motors Corp., Ford Motor Co., and Chrysler LLC are
negotiating with the United Auto Workers union to stop a program
that pays idled workers, Matthew Dolan at The Wall Street Journal
reports, citing people familiar with the matter.
Gary Haber at The News Journal relates that "jobs bank" is a
unique protection for laid-off workers. According to the report,
laid-off workers are placed in the jobs bank, where they can get
about 95% of their usual pay and benefits. WSJ says that GM, Ford
Motor, and Chrysler are trying to eliminate or scale back the
program as part of an effort to secure a US$25 billion loan from
the government. The News Journal states that the jobs bank
doesn't start until laid-off employees exhaust a period of
unemployment benefits and supplemental pay from the company.
Citing GM spokesperson Tony Sapienza, the News Journal states that
said that the workers can start benefiting from the jobs bank when
they have been idled for 48 weeks. The report states that the
workers would get unemployment benefits and supplemental pay of
85% of pay. GM, according to the report, can remain in the jobs
bank for up to two years, but will lose their pay and benefits if
they refuse a single job offer at a GM plant within 50 miles of
their home plant, or turn down four job offers at GM plants more
than 50 miles away.
Critics say that the "jobs banks" are a disadvantage for GM, Ford
Motor, and Chrysler, as they are an "overly generous benefit" at
firms that report billions in losses, The News Journal states.
The News Journal quoted UAW President Ron Gettelfinger as saying,
"We're on the verge of eliminating that provision."
UAW Wants Cos. to Curb Corporate Pay, Bonuses & Severance Pays
Citing Gettelfinger, Reuters relates that Ford Motor, GM, and
Chrysler should limit corporate pay, bonuses, and severance
packages in return for government loans. Reuters quoted Mr.
Getterlfinger as saying, "They need to establish that executive
compensation is something that they're willing to curtail, as well
as bonuses and 'golden parachutes' on exiting the business. They
can also give the government an equity stake in the business."
Mr. Gettelfinger said on CNN that the automakers need a loan to
help them survive a tough period. According to WSJ, Mr.
Gettelfinger said, "It's not just here in the United States and
this is not a bailout, this is a loan, a bridge loan that will get
us through until we can take a longer term look at what needs to
be done in the industry."
Union wages weren't the key cause of waning sales at the
companies, Reuters states, citing Mr. Gettelfinger.
About Ford Motor Co.
Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) --
http://www.ford.com/-- manufactures or distributes automobiles in
200 markets across six continents. With about 260,000 employees
and about 100 plants worldwide, the company's core and affiliated
automotive brands include Ford, Jaguar, Land Rover, Lincoln,
Mercury, Volvo, Aston Martin, and Mazda. The company provides
financial services through Ford Motor Credit Company.
The company has operations in Japan in the Asia Pacific region. In
Europe, the company maintains a presence in Sweden, and the United
Kingdom. The company also distributes its brands in various
Latin-American regions, including Argentina and Brazil.
* * *
As reported in the Troubled Company Reporter on Nov. 11,
2008, Moody's Investors Service lowered the debt ratings of
Ford Motor Company, Corporate Family and Probability of
Default Ratings to Caa1 from B3. The company's Speculative
Grade Liquidity rating remains at SGL-3 and the rating outlook
is negative. In a related action Moody's also lowered the
long-term rating of Ford Motor Credit Company to B3 from B2.
The outlook for Ford Credit is negative.
As reported in the Troubled Company Reporter on Oct. 10, 2008,
Fitch Ratings downgraded the Issuer Default Rating of Ford Motor
Company and Ford Motor Credit Company by one notch to 'CCC' from
'B-'.
***********
Monday's edition of the TCR-LA delivers a list of indicative
prices for bond issues that reportedly trade well below par.
Prices are obtained by TCR-LA editors from a variety of outside
sources during the prior week we think are reliable. Those
sources may not, however, be complete or accurate. The Monday
Bond Pricing table is compiled on the Friday prior to
publication. Prices reported are not intended to reflect actual
trades. Prices for actual trades are probably different. Our
objective is to share information, not make markets in publicly
traded securities. Nothing in the TCR-LA constitutes an offer
or solicitation to buy or sell any security of any kind. It is
likely that some entity affiliated with a TCR-LA editor holds
some position in the issuers' public debt and equity securities
about which we report.
Tuesday's edition of the TCR-LA features a list of companies
with insolvent balance sheets obtained by our editors based on
the latest balance sheets publicly available a day prior to
publication. At first glance, this list may look like the
definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical
cost net of depreciation may understate the true value of a
firm's assets. A company may establish reserves on its balance
sheet for liabilities that may never materialize. The prices at
which equity securities trade in public market are determined by
more than a balance sheet solvency test.
A list of Meetings, Conferences and Seminars appears in each
Thursday's edition of the TCR-LA. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com
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S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter - Latin America is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Fairless
Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick,
Maryland USA. Marie Therese V. Profetana, Marites O. Claro, Joy
A. Agravente, Pius Xerxes V. Tovilla, Rousel Elaine C. Tumanda,
Valerie C. Udtuhan, Frauline S. Abangan, and Peter A. Chapman,
Editors.
Copyright 2008. All rights reserved. ISSN 1529-2746.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.
Information contained herein is obtained from sources believed to
be reliable, but is not guaranteed.
The TCR Latin America subscription rate is US$625 per half-year,
delivered via e-mail. Additional e-mail subscriptions for members
of the same firm for the term of the initial subscription or
balance thereof are US$25 each. For subscription information,
contact Christopher Beard at 240/629-3300.
* * * End of Transmission * * *