/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/120604.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 Monday, June 4, 2012, Vol. 13, No. 110 Headlines A R G E N T I N A CENTRAIS ELECTRICAS: S&P Cuts CCR to 'SD' on Failure to Pay Debt B E R M U D A B+H OCEAN CARRIERS: Files for Chapter 11 in Manhattan B R A Z I L * BRAZIL: Moody's Says Steelmakers Adjust Business Model C A Y M A N I S L A N D S ATC FUND: Shareholder to Receive Wind-Up Report on June 22 BEAR STEARNS: Shareholders' Meeting Set for June 25 CLEAR VISION: Members' Final Meeting Set for June 14 COVEPOINT COMMODITY: Shareholders' Final Meeting Set for June 22 COVEPOINT COMMODITY MASTER: Shareholders' Meeting Set for June 22 CV DISTRIBUTION: Shareholder to Receive Wind-Up Report on July 11 GSO LIQUIDITY: Shareholders' Final Meeting Set for June 22 H.B.D. ASSOCIATES: Shareholder to Hear Wind-Up Report on June 25 HERCULES INTERNATIONAL: Shareholders' Meeting Set for June 22 HFC JAPAN: Shareholders' Final Meeting Set for June 22 INTERNET ASSETS: Shareholders' Final Meeting Set for June 14 MANMAR LIMITED: Members' Final Meeting Set for June 14 MARNAY INVESTMENTS: Shareholders' Final Meeting Set for June 22 MBA INTERNATIONAL: Shareholder to Hear Wind-Up Report on July 11 RINCON LEASING: Shareholders' Final Meeting Set for June 22 J A M A I C A BREEZES TRELAWNY: To Close Old Business, 200 to be Made Redundant CARIBBEAN CEMENT: Cement Prices Up by 9% M E X I C O BANCA MIFEL: Weak Performance Cues Fitch to Affirm Ratings COLUMBUS INT'L: Moody's Says Increased Leverage Credit Negative ELEMENTIA SA: Fitch Affirms Issuer Default Rating at 'BB+' GRUPO PAPELERO: Moody's Downgrades CFR to 'B1'; Outlook Stable MEXICANA AIRLINES: MRO Operation to Remain Revenue Generator P U E R T O R I C O HOME SAFETY: Case Summary & 20 Largest Unsecured Creditors T R I N I D A D & T O B A G O TRINIDAD CEMENT: Ministry Refers Dispute to Industrial Court X X X X X X X X * BOND PRICING: For the Week May 28 to June 1, 2012 - - - - - ================= A R G E N T I N A ================= CENTRAIS ELECTRICAS: S&P Cuts CCR to 'SD' on Failure to Pay Debt ---------------------------------------------------------------- Standard & Poor's Ratings Services downgraded Centrais Eletricas Matogrossenses S.A. (Cemat) to 'SD' from 'CCC'. "At the same time, we downgraded Companhia de Energia Eletrica do Estado do Tocantins (Celtins) to 'CC' from 'CCC'. We removed both ratings from CreditWatch with negative implications where we place them on March 1, 2012. The outlook on Celtins is negative. Celtins and Cemat are electric energy distribution companies owned by Brazil- based group Rede Energia S.A.," S&P said. "The downgrade follows Cemat's postponement of the payment of R$448.5 million debt (representing 30% of its total adjusted debt), as part of the request for debt restructuring with all its creditors. In accordance with our criteria, and because we believe no appropriate compensation with respect to the obligations that were deferred has been provided, we view the restructuring as tantamount to default. The ratings on Cemat will remain at 'SD' until the obligations are subsequently restructured," S&P said. "As we have noted in our previous reports, we view Centrais Eletricas do Par S.A.'s judicial reorganization filing as increasing the refinancing risk of Rede Group's other subsidiaries. The downgrade of Celtins reflects our view that the company won't be compliant with its debt obligations because of still disappointing operating performance, very limited access to additional funding, and weak liquidity position," S&P said. ============= B E R M U D A ============= B+H OCEAN CARRIERS: Files for Chapter 11 in Manhattan ----------------------------------------------------- Hamilton, Bermuda-based B+H Ocean Carriers, along with affiliates, filed a Chapter 11 bankruptcy petition (Bankr. S.D.N.Y. Case No. 12-12356) in Manhattan on May 30, 2012. The Company said that it intends to restructure its balance sheet and emerge as a recapitalized shipowning business, continuing to specialize in the transportation of refined petroleum products and dry bulk commodities. B+H Ocean Carriers disclosed $4.52 million in assets and $46.1 million in liabilities. Debts include $9.64 million owed to Bank of Nova Scotia Asia Ltd. under a loan facility agreement, $3.98 million to Bank of Scotland under a revolving credit facility, and 18.8 million to Nordea Bank, as agent for a bank lending group. A meeting of creditors under 11 U.S.C. Sec. 341(a) is scheduled for June 29 at 2:30 p.m. Judge Shelley C. Chapman has been assigned to the case. The Company stated that going forward, its operations will continue as in the past, with no interruption of service. It also said that it has had ongoing discussions with several of its lenders regarding further cooperation and support during the reorganization. "There continue to be challenges in the current market for freight rates and vessel values which, combined with the state of global ship finance, has made it exceedingly difficult to accomplish the recapitalization outside of a court-supervised reorganization," B+H Ocean saind in a statement. B+H Ocean Carriers Ltd. is an international ship-owning and operating company that owns, through subsidiaries, a fleet of four product-suitable Panamax combination carriers capable of transporting both wet and dry bulk cargoes, along with a 50% interest in an additional combination carrier. =========== B R A Z I L =========== * BRAZIL: Moody's Says Steelmakers Adjust Business Model --------------------------------------------------------- Fundamental changes in the Brazilian steel market, led by a rise in imports and in key input costs, have meant steel producers need increasing investments in self-sufficiency to become more competitive to grow market share, says Moody's Investors Service in its new special comment "Brazil's Steelmakers Adjust Business Model Amid Changes in Industry Conditions." "Historically, Brazilian steel producers have benefited from Brazil's abundant raw materials, relatively low cost structures, a robust domestic market and long-term client relationships," says Barbara Mattos, a Moody's Assistant Vice President -- Analyst and author of the report. "However, increased competition from imports and weaker fundamentals in the global market have forced Brazilian steelmakers to compete by lowering prices to international levels." Steel prices are also dampened by the weak domestic demand from automotive and appliance-makers as well as by global overcapacity which has kept steel imports into Brazil at high levels. Profitability contracted significantly during the first quarter of 2012, due to these lower steel prices combined with higher costs for iron ore, coking coal and energy and labor. Alleviating the pressure from high input costs will be key for Brazilian steelmakers. These rising costs mean steelmakers must become more self-sufficient in iron ore and electricity in the near- and medium-term, says Moody's. CSN is already self- sufficient but Gerdau and Usiminas have much farther to go. Domestic steel's price premium over international prices have vanished, says Moody's, noting that Brazil's steel imports, with about 45% coming from Asia, surged to 21% of apparent consumption in 2010, from 11% in 2009 and returned to 13-14% in 2011 to 2012. Brazilian steelmakers hit hard include Usinas Siderurgicas de Minas Gerais (Usiminas, Ba2 stable), Companhia Sider£rgica Nacional (CSN, Ba1 positive), both of which produce flat steel, and Gerdau (Baa3 stable), which produces long and specialty steel, says the report. =========================== C A Y M A N I S L A N D S =========================== ATC FUND: Shareholder to Receive Wind-Up Report on June 22 ---------------------------------------------------------- The shareholder of ATC Fund Services (Cayman) Limited will receive on June 22, 2012, at 10:00 a.m., the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Appleby Trust (Cayman) Ltd. PO Box 1350 Clifton House, 75 Fort Street Grand Cayman KY1-1108 Cayman Islands BEAR STEARNS: Shareholders' Meeting Set for June 25 --------------------------------------------------- The shareholders of Bear Stearns Global Lending Limited will hold their final meeting on June 25, 2012, to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Timothy J. Smith c/o Maples and Calder, Attorneys-at-law PO Box 309, Ugland House Grand Cayman KY1-1104 Cayman Island CLEAR VISION: Members' Final Meeting Set for June 14 ---------------------------------------------------- The members of Clear Vision Limited will hold their final meeting on June 14, 2012, to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Eagle Holdings Ltd. c/o Barclays Private Bank & Trust (Cayman) Limited FirstCaribbean House, 4th Floor P.O. Box 487 Grand Cayman KY1-1106 Cayman Islands COVEPOINT COMMODITY: Shareholders' Final Meeting Set for June 22 ---------------------------------------------------------------- The shareholders of Covepoint Commodity Currency Overseas Fund, Ltd. will hold their final meeting on June 22, 2012, 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: Walkers Corporate Services Limited Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002 Cayman Islands c/o Jennifer Chailler Telephone: (345) 814 6847 COVEPOINT COMMODITY MASTER: Shareholders' Meeting Set for June 22 ----------------------------------------------------------------- The shareholders of Covepoint Commodity Currency Master Fund, Ltd. will hold their final meeting on June 22, 2012, 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: Walkers Corporate Services Limited Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002 Cayman Islands c/o Jennifer Chailler Telephone: (345) 814 6847 CV DISTRIBUTION: Shareholder to Receive Wind-Up Report on July 11 ----------------------------------------------------------------- The shareholder of CV Distribution Services Ltd. will receive on July 11, 2012, at 2:00 p.m., the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Benjamin Greenspan Greenspan Law Office 620 Laguna Road, Mill Valley California 94941 USA Telephone: +1 (415) 381-3283 Facsimile: +1 (415) 738-5371 GSO LIQUIDITY: Shareholders' Final Meeting Set for June 22 ---------------------------------------------------------- The shareholders of GSO Liquidity Partners (Cayman) Limited will hold their final meeting on June 22, 2012, at 9:50 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Walkers Corporate Services Limited Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002 Cayman Islands c/o Jennifer Chailler Telephone: (345) 814 6847 H.B.D. ASSOCIATES: Shareholder to Hear Wind-Up Report on June 25 ---------------------------------------------------------------- The shareholder of H.B.D. Associates Ltd will receive on June 25, 2012, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Commerce Corporate Services Limited Telephone: 949 8666 Facsimile: 949 0626 PO Box 694 Grand Cayman Cayman Islands HERCULES INTERNATIONAL: Shareholders' Meeting Set for June 22 ------------------------------------------------------------- The shareholders of Hercules International Limited will hold their final meeting on June 22, 2012, to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Royhaven Secretaries Limited c/o Julie Reynolds Telephone: 945 4777 Facsimile: 945 4799 P.O. Box 707 Grand Cayman KY1-1107 Cayman Islands HFC JAPAN: Shareholders' Final Meeting Set for June 22 ------------------------------------------------------ The shareholders of HFC Japan Tactical Alpha Strategy will hold their final meeting on June 22, 2012, at 9:40 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Walkers Corporate Services Limited Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002 Cayman Islands c/o Jennifer Chailler Telephone: (345) 814 6847 INTERNET ASSETS: Shareholders' Final Meeting Set for June 14 ------------------------------------------------------------ The shareholders of Internet Assets, Inc. II will hold their final meeting on June 14, 2012, at 2:00 p.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Avalon Management Limited Landmark Square, 1st Floor 64 Earth Close, West Bay Beach P.O. Box 715 Grand Cayman KY1-1107 Cayman Islands Facsimile: 1 345 769-9351 MANMAR LIMITED: Members' Final Meeting Set for June 14 ------------------------------------------------------ The members of Manmar Limited will hold their final meeting on June 14, 2012, to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Eagle Holdings Ltd. c/o Barclays Private Bank & Trust (Cayman) Limited FirstCaribbean House, 4th Floor P.O. Box 487 Grand Cayman KY1-1106 Cayman Islands MARNAY INVESTMENTS: Shareholders' Final Meeting Set for June 22 --------------------------------------------------------------- The shareholders of Marnay Investments will hold their final meeting on June 22, 2012, to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Royhaven Secretaries Limited c/o Julie Reynolds Telephone: 945 4777 Facsimile: 945 4799 P.O. Box 707 Grand Cayman KY1-1107 Cayman Islands MBA INTERNATIONAL: Shareholder to Hear Wind-Up Report on July 11 ---------------------------------------------------------------- The shareholder of MBA International Investments, Inc. will receive on July 11, 2012, at 3:00 p.m., the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Ogier c/o Bradley Kruger Telephone: (345) 815-1877 Facsimile: (345) 949-9877 RINCON LEASING: Shareholders' Final Meeting Set for June 22 ----------------------------------------------------------- The shareholders of Rincon Leasing Ltd. will hold their final meeting on June 22, 2012, at 9:00 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: David A.K. Walker c/o Jodi Jones Telephone: (345) 914 8694 Facsimile: (345) 945 4237 PO Box 258 Grand Cayman KY1-1104 Cayman Islands ============= J A M A I C A ============= BREEZES TRELAWNY: To Close Old Business, 200 to be Made Redundant ----------------------------------------------------------------- RJR News reports that Breezes Trelawny Resort and Spa is scheduled to close today ahead of a change in ownership. Superclubs said in March that the resort will be taken over by an overseas operator, according to RJR News. The report relates that the positions of 200 workers will be made redundant. Head of Superclubs, John Issa, said job opportunities may arise with the new operator, RJR News notes. Although not giving details, Mr. Issa explained that the sale was a welcomed option based on the plans the new operators have for the property, and the potential benefit for the area, RJR News discloses. CARIBBEAN CEMENT: Cement Prices Up by 9% ---------------------------------------- RJR News reports that Caribbean Cement Company Limited will implement a 9% price increase. The company explains that having critically reviewed all strategies that affect its performance, it is left with no choice but to institute the price adjustment, according to RJR News. Following a rebound in sales towards the end of last year, Carib Cement says its domestic market is again on the downturn, the report notes. A statement from the company said the uptick has not been maintained and the market is contracting, RJR News discloses. Added to this, RJR News notes that Carib Cement said in the first four months of this year, oil prices continued to rise. The report relays that it said this translated into a 9% increase in electricity costs. According to Carib Cement the increase directly impacts on mining, manufacturing and distribution costs, RJR News notes. Carib Cement said its situation is not very different from other manufacturers in the region which have also been adjusting their prices in the face of escalating costs, RJR News says. It adds that despite the price adjustment, its ex-factory price will still be the lowest among cement manufacturing countries such as Mexico, Columbia, the Dominican Republic, Barbados and Trinidad, the report relays. About Caribbean Cement Caribbean Cement Company Limited manufactures and sells cement. * * * As reported in the Troubled Company Reporter-Latin America on Aug. 18, 2011, Caribbean Cement Company Limited has incurred a JM$608.08 million loss in the three months ended April to June 2011 from JM$217.95 million loss in the same period last year. The company incurred JM$857.56 million loss in the six months ended January to June 2011 from a JM$213.40 million in the same period 2010. Caribbean Cement posted a JM$1.58 billion loss in the year ended 2010. =========== M E X I C O =========== BANCA MIFEL: Weak Performance Cues Fitch to Affirm Ratings --------------------------------------------------------- Fitch Ratings has affirmed Banca Mifel's ratings as follows: -- Long-term Issuer Default Rating (IDR) at 'BB-'; -- Short-term IDR at 'B'; -- Long-term local currency IDR at 'BB-'; -- Short-term local currency IDR at 'B'; -- Viability rating at 'bb-'; -- Support rating at '5'; -- Support rating floor at 'NF'; -- USD100 million perpetual non-cumulative junior subordinated callables notes at 'B-'; -- USD150 million cumulative subordinated preferred notes at 'B'; -- National scale long-term rating affirmed at 'A-(mex)'; -- National scale short term rating affirmed at 'F2(mex)'. The Rating Outlook is Stable. Mifel's ratings are driven by its moderate financial condition and weak operating performance, relatively modest franchise, and a business model that is gradually positioning Mifel as a strong competitor among its peers in commercial lending. The ratings also reflect the reasonable asset quality of its loan portfolio, its sound funding profile, and modest liquidity that has deteriorated slightly in recent periods. A recent improvement of Mifel's capital adequacy was also a key factor supporting its affirmation and Stable Outlook, since the stronger capital base partially compensates for its weak earnings generation and declining loan loss reserve coverage. The Stable oOutlook is driven by its improved capitalization metrics, following capital injections completed during first quarter 2012 (1Q'12), and which will be even higher during the next quarter (at the total regulatory and eligible capital levels), following a the new hybrid issued in May 2012. In Fitch's view, Mifel's ratings could benefit in the medium term by its the higher loss absorption capacity derived from this capitalization, if coupled with an adequate growth of its loan portfolio (high quality) and material improvements of in its core profitability drivers. On the other hand, further deteriorations of the bank's liquidity profile, tighter core operating profitability, and worsening of impairment and loan reserve levels, could pressure the bank's ratings downward. After reporting negative operating results during 2008 and 2009 arising from the branch network growth and the adverse economic environment, Mifel has been able to improve its financial performance, although its operating results are still weak, mainly as a result of tight net interest margins and poor operating efficiency. In Fitch's opinion, higher credit and non-interest costs, as well as the smaller sub-national loan portfolio, are the main drivers of Mifel's low profitability. Mifel's franchise is relatively modest, and its business model, which focuses on middle middle-market commercial loans and deposits from upper-middle and upper-income segments, still has some challenges to consolidate during 2012, primarily to improve the overall credit quality of its loan portfolio. Also, related party loans have been, in Fitch's opinion, historically high for Banca Mifel, although these have been gradually declining, in line with more stringent local regulations, although Fitch considers that such regulations are still weak relative to international standards. Mifel's loan portfolio declined in 2011, since due to athere was a reduction of sub-national lending,. Fitch considers this reduction as positive, as this particular sector has been increasingly challenging recently. The loan portfolio exhibits geographic and sector concentrations, as well as higher than peers impairment ratios, explained mainly by the agribusiness and mortgage sectors, as well as by low charge-offs. While asset quality seems to be improving in 1Q'12, these trends still need to be tested once Mifel resumes lending more actively. A sound funding profile remains a major strength, as Mifel has access to considerable amounts of retail deposits and has proven been able to create a recurring and stable customer deposit base, which funds the bank's entire loan portfolio. Nevertheless, these deposits are concentrated on term accounts (87% at 1Q'12), and most of these are in the form of money market deposits. In Fitch's opinion, Mifel's liquidity profile exhibits room for improvement, especially in view of ample asset-liability tenor mismatches. Capital levels were strengthened significantly at 1Q'12, in response to capital injections during the first months of 2012 by the International Finance Corporation (IFC), together with additional contributions from previous and new local shareholders for a total amount of MXN509 million. Mifel will show even higher regulatory and eligible capitalization ratios during the next quarter, due to the new hybrid issue. Nevertheless, in Fitch's view, this will be temporary, but when lending resumes, Fitch expects the regulatory and eligible capital ratios to be slightly above 15%, while the Fitch core capital ratio will likely be around 10% of total risk weighted assets. Established in 1993, Mifel is the largest entity of Grupo Financiero Mifel, which also has factoring, leasing and mutual fund management companies. The bank has traditionally targeted SMEs and medium-sized real estate developers, and more recently government related entities, although the relative contribution of the latter is declining. COLUMBUS INT'L: Moody's Says Increased Leverage Credit Negative --------------------------------------------------------------- On May 31, 2012, Moody's Investors Service commented on Columbusannouncement, on the same date, that it had recently entered into a US$225 million 9.50% Senior Guaranteed Unsecured Notes Facility due 2017 (the "Notes Facility" and the notes issued thereunder, the "Notes"). The company has initially drawn US$82 million from the Notes Facility. Additional amounts under the Notes Facility are available to Columbus until May 21, 2013 so long as its remains in compliance with the covenants of both its 2014 Senior Secured Notes Indenture and the Note Purchase Agreement which governs the Notes Facility; both limit the company from incurring additional debt beyond 4 times debt/EBITDA. The Notes bear annual interest at rate of 9.50%, paid quarterly, and are callable after 2.5 years and in other limited circumstances described in the Note Purchase Agreement. Columbus intends to use the net proceeds from the Notes to accelerate the completion of current capital plans, fund potential future acquisitions, enhance balance sheet liquidity and flexibility and for general corporate purposes. Rating Rationale The new Notes Facility is credit negative to Columbus since it increases its leverage while free cash flow remains negative. As of March 31, 2012,Columbus' leverage was 3.9 times adjusted debt to EBITDA and for the end of 2012 Moody's had expected that it would be well below 4 times. In turn, free cash flow to adjusted debt in the last twelve months ended in March 2012 was a negative 2.8%. Moody's now expects, proforma for the new Notes Facility, that the company's adjusted leverage will decline but remain around 4 times for another couple of years. On the positive side, the Notes Facility may provide for additional liquidity if its proceeds are not entirely used to fund acquisitions or accelerate capex. It is also positive that operating results in 1Q12 were strong in terms of revenue growth (5.5% QoQ and 19% YoY) and adjusted EBITDA margin (49.7% in 1Q12 from 48.2% in 1Q11). Columbus' B2 ratings reflect the company's modest size and cash flow generation; high leverage; limited operating track record; and high business risk derived from being a small telecom operator in Central America and theCaribbean. In addition, the company's free cash flow generation is dependent upon its ability to grow revenues, sustain margins and reduce capital expenditures. These risks are mitigated by significant availability of capacity in Columbus' state-of-the-art sub-sea network, which offers room to grow revenues with limited competitive risk. In addition, ratings consider the upside growth potential for its cable TV and telecom business in broadband and the company's solid market shares in its coverage areas. The principal methodology used in rating Columbus was the Global Communications Infrastructure Industry Methodology published in June 2011. Columbus International Inc. is a privately held telecommunications and cable TV company based in Barbados. Columbus provides digital cable television, broadband Internet, digital landline telephony and corporate data services inTrinidad, Jamaica, Grenada and Curacao. Through its wholly owned subsidiary, Columbus Networks, the company provides capacity and IP services, corporate data solutions and data center hosting throughout 23 countries in the greaterCaribbean, Central American and Andean region. Through its ringed submarine fiber optic network spanning close to 18,000 km and its 21,000 km terrestrial fiber and coaxial network, Columbus' 1,900 employees provide telecom services to a diverse residential and corporate client base of close to 500,000 customers. Columbus' customer base is comprised of leading telecom companies such as Sprint International, Telmex, CanTV, Telefonica, AT&T, Telgua (fixed line operator in Guatemala and owned by America Movil) and ETB (fixed line operator in Bogot , Colombia). ELEMENTIA SA: Fitch Affirms Issuer Default Rating at 'BB+' ---------------------------------------------------------- Fitch Ratings has affirmed Elementia, S.A. de C.V.'s (Elementia) ratings as follows: -- Long-term Issuer Default Rating (IDR) at 'BB+'; -- Long-term Local Currency IDR at 'BB+'; -- Long-term National Scale Rating at 'A+(mex)'. The Rating Outlook is Stable In addition, Fitch has affirmed Elementia's Local Certificados Bursatiles due in 2015 at 'A+(mex)'. Elementia's ratings reflect its solid business profile characterized by geographic and product line diversification, leading market shares in the regions where it has presence, supported by highly recognized brands and a well developed distribution network, positive cash generation and its shareholders' strength. Factors that limit Elementia's ratings are the company's current high leverage, industry cyclicality, input costs volatility and environmental regulation. High Leverage Main Credit limitation: At Dec. 31, 2011 Elementia's leverage measured by total debt to EBITDA was high at 3.1x in dollar terms, above the company's management long term target of total debt to EBITDA at or below 2.0x and Fitch's previous expectations of leverage in the upper range of 2.5x-3.0x. The company is in the process of completion of a new cement plant that is estimated to begin commercial operations at the end of this year and contributing in 2013 to the company's results. Fitch anticipates that Elementia will continue funding its future growth through a combination of internally generated cash and external financing. Fitch estimates that Elementia has flexibility to continue financing its growth strategy; however further deterioration in leverage ratios and debt financed acquisitions could put pressure on the company's credit profile. Positive Cash Generation Supports the Ratings: During 2011, Elementia generated positive Free Cash Flow (FCF) that was used primarily in capex and to strengthen its cash balance. Increased revenues across business segments in conjunction with management's strict cost and expenses control and working capital optimization initiatives allowed Elementia to increase its cash position at the end of 2011 to USD254 million from USD122 million in the past year. The company's Net Debt to EBITDA ratio improved to 1.4x from 2.8x in 2010. Fitch estimates for 2012 that the company's Net Debt to EBITDA will be in a range of 1.5x-2.0x. Continued Business Diversification: The company's business position is supported by its diversified revenue base. In 2011 the company generated consolidated revenues and EBITDA of USD1.17 billion and USD149 million, respectively. The metal division (mainly copper products) represented approximately 66% of consolidated sales and 44% of EBITDA, building systems (including fiber cement) contributed with 30% of sales and approximately 50% of EBITDA and plastics represented 4% and 6% respectively. Elementia's cash flow is supported by its pricing strategy, especially in the metal segment, where the company applies a cost-plus margin formula, allowing it to pass- through metal price variations to end customers. The company's strategy will continue to be focused in growth current operations and through acquisitions. Strong Liquidity and Low Refinancing Risk: Liquidity and refinancing risk is low. At Dec. 31, 2011 the company had a cash balance of USD254 million, short-term debt of USD12 million and total debt of USD461 million. During 2011 Elementia refinanced the bank debt through a club deal with Mexican banks for approximately MXN2.7 billion. As of March 2012 the company's short-term debt was minimal, and major maturities start in 2015 when MXN3 billion in Certificados Bursatiles come due. In 2010 the company received an equity injection of approximately USD43 million to strengthen its balance sheet. Environmental Regulations Could Limit Operations: The company uses chrysotile fibers (the sole form of asbestos still in use) for part of its production of fiber-cement products, which are sold locally where permitted in the North and South American regions. Products that are exported to the United States are manufactured using other fibers such as cellulose fiber and polyvinyl alcohol (PVA). The use of this fiber is in line with international standards and local environmental regulations. However, if authorities (labor, health or environmental) limit the use of this raw material in the future, or restrictions to the transport and imports of chrysotile are imposed, Elementia could face supply disruptions affecting selling volumes. Even though Elementia has not been subject to legal claims regarding the use of chrysotile in its products, future claims cannot be ruled out, resulting in uncertain litigation risk. GRUPO PAPELERO: Moody's Downgrades CFR to 'B1'; Outlook Stable -------------------------------------------------------------- Moody's Investors Service has downgraded Grupo Papelero Scribe, S.A. de C.V.'s (Scribe) corporate family rating to B1 from Ba3. At the same time Moody's has downgraded the rating of the USD300 million senior unsecured notes due 2020 to B1 from Ba3. The ratings outlook is stable. Ratings Rationale "The downgrade reflects the company's weakened credit profile over the last nine months driven by higher debt incurred to finance the acquisition of the Colombian notebook business from Kimberly Colpapel, S.A. combined with weak EBITDA generation resulting in high leverage and low interest coverage" said Alonso S nchez Rosario, an Assistant Vice President at Moody's. As of December 31, 2011, Moody's adjusted Debt/EBITDA was 7.7x and interest coverage (EBITDA/Interest expense) was 1.5x in 2011. Moody's estimates that for the first quarter of 2012 debt/EBITDA will improve but remain high at levels around 6.5x as EBITDA increases due to the absence of extraordinary expenses combined with relatively lower average foreign exchange rate and pulp prices. Scribe's B1 ratings reflects the company's material financial leverage, modest interest coverage, its moderate operating scale and business diversification compared to international paper industry peers, and the exposure to commodity input costs (primarily pulp and energy) and foreign exchange risk, which can cause significant earnings volatility. The rating also takes into account the seasonality of the company's notebook business, which results in significant intra-year working capital swings. The rating is supported by the company's leading presence in the Mexican printing and writing paper and notebook markets with branded and consumer-oriented product content. The rating also reflects Scribe's adequate liquidity, its broad nationwide distribution system and the significant industry experience of its senior management team. Scribe's margins are largely affected by commodity price volatility and exchange rates. The company's profitability depends heavily on pulp and energy prices. Pulp alone represents a high percentage of the company's cost of goods sold and is largely obtained at international prices, while energy and water account for another important part of the cost. Scribe has some vertical integration in the pulp and paper value chain as it produces internally about 30% of its pulp needs. During the second half of 2011, the company achieved savings from lower pulp prices which were offset by the 13% depreciation of the Mexican peso during the year. As a result, gross margins remained essentially flat at 16.5% in 2011. However, operating margin declined from 5.6% in 2010 to 4.4% in 2011 due to increased advertising, sales and marketing expenses to re-launch cut sized paper "Scribe-Alebrije" brand combined with extraordinary expenses related to the acquisition of its notebook business in Colombia. Scribe's reported EBITDA was MXN690 million in 2011 compared to MXN734 million in 2010. Going forward, Moody's anticipates that Scribe's margins could benefit from expected lower pulp prices over the next 12-18 months. Moody's foresees that Scribe will be able to improve its margins as a result of lower pressure on its cost structure due to lower pulp prices expected during the next several months. Credit metrics should largely continue to follow earnings trends with limited potential for improvement from debt reduction as the USD300 million notes due 2020 represent essentially all of the company's long-term debt and cannot be called before 2015. Moody's could consider an upgrade of the ratings if operating margin improves while maintaining limited margin volatility and adequate liquidity. To be considered for an upgrade free cash flow should be positive and EBITDA generation should increase such that debt/EBITDA declines below 4.5x on a sustained basis. Ratings could come under pressure because of weaker than anticipated trends in operating margin and credit metrics, for example because of a combination of higher pulp costs and a depreciation of the peso, such that adjusted Debt/EBITDA remains above 6x and EBITDA/Interest Expense remains at 2x or below for a prolonged period of time. Rating pressure could also emerge if free cash flow remains negative and liquidity deteriorates. The principal methodology used in rating Grupo Papelero Scribe was the Global Paper and Forest Products Industry Methodology published in September 2009. Scribe, headquartered in Mexico City, is Mexico's largest producer of printing and writing paper and notebooks based on sales volume, with MXN5,656 million of revenues in 2011. The company operates four mills with an installed capacity of 395 thousand tons for paper (including tissue) and 97 thousand tons for wood pulp. Scribe was formed in 2006 and is currently owned by Impulso de Desarrollos Estrat‚gicos, S.A. de C.V. (Impulso), a privately-held Mexican company, and Eton Park Capital Management, LP, a US-based financial investor. Impulso and Eton Park together control 100% of Corporacion Scribe, S.A.P.I de C.V., Scribe's parent company. MEXICANA AIRLINES: MRO Operation to Remain Revenue Generator ------------------------------------------------------------ Aviation Daily reports that Med Atlantica, which recently purchased Mexicana de Aviacion, has signaled its intent to retain Mexicana MRO Services, the carrier's maintenance, repair and overhaul operation, but structured it as a subsidiary of the airline. The MRO provider has remained open since the airline ceased operating in August 2010, and has been the only revenue generator for the company as it restructured under bankruptcy court protection, according to Aviation Daily. "MRO Services is an integral part of Mexicana, and revenues generated by it are included in Mexicana's new business plan . . . . There are no plans to sell it," Aviation Daily quoted an unnamed spokesman as saying. The MRO operation is a guarantor of Mexicana's total debt, which precludes its sale to an outside buyer, he added. Aviation Daily notes that before Med Atlantica's investment, industry observers speculated that rival Aeromexico would acquire Mexicana's maintenance division. Aviation Daily discloses that while Mexicana's revival is planned for August, Med Atlantica has more immediate concerns with its MRO division as the facility's lease with the airport authority Aeropuerto Internacional de la Ciudad de Mexico due to expire today. The report relates that the airline's unions have joined with management seeking for a lease extension without increased payment terms, although a source close to the airline says that should the lease talks fail the federal government has the authority to shutter the MRO facility after May 31. Mexicana MRO Services is a narrowbody airframe specialist, but also has widebody capabilities. With facilities at the international airports of Mexico City and Guadalajara, the company can service up to 10 narrowbodies and two widebodies simultaneously. It outsources landing gear and engine maintenance. The airline accounted for about 60% of Mexicana MRO Services' business before suspending operations, with third-party airlines comprising the other 40%. Compania Mexicana de Aviacion or Mexicana Airlines -- http://www.mexicana.com/--is a privately held airline and a subsidiary of Nuevo Grupo Aeronautico. Founded in 1921, Mexicana is the oldest commercial carrier in North America. Charles Lindbergh piloted the first trip for Mexicana between Brownsville, Texas, and Mexico City. Grupo Mexicana de Aviacion is the parent of Compania Mexicana. Two other units are Aerovias Caribe S.A. de C.V. (Mexicana Click) and Mexicana Inter S.A. de C.V. (Mexicana Link). Compania Mexicana de Aviacion or Mexicana Airlines, Mexico's largest airline, filed for bankruptcy in the U.S. and Mexico on Aug. 2, 2010. In the U.S., the company filed in the U.S. Bankruptcy Court in Manhattan for Chapter 15 bankruptcy protection (case no. 10-14182), and in Mexico, it filed for the equivalent of Chapter 11. Maru E. Johansen, foreign representative of Compania Mexicana, estimated in the Chapter 15 petition that the company has assets of US$500 million to US$1 billion and debts of more than US$1 billion. William C. Heuer, Esq., at Duane Morris LLP, serves as counsel to Ms. Johansen. Mexicana de Aviacion stated that despite its bankruptcy filing, it expects to continue to operate normally, and that such filings did not affect the operations of Click Mexicana and Mexicana Link, which are independent companies from Mexicana de Aviacion. ===================== P U E R T O R I C O ===================== HOME SAFETY: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Home Safety Awareness Corp. aka Casa Segura PMB 117 P.O. Box 4956 Caguas, PR 00726 Bankruptcy Case No.: 12-04107 Chapter 11 Petition Date: May 28, 2012 Court: U.S. Bankruptcy Court District of Puerto Rico (Old San Juan) Debtor's Counsel: Maria Mercedes Figueroa Y Morgade, Esq. FIGUEROA Y MORGADE LEGAL ADVISORS 3415 Alejandrino Avenue, Apartment 703 Guaynabo, PR 00969-4956 Tel: (787) 234-3981 E-mail: figueroaymorgadelaw@yahoo.com Scheduled Assets: $0 Scheduled Liabilities: $1,900,654 A copy of the Company's list of its 20 largest unsecured creditors filed with the petition is available for free at: http://bankrupt.com/misc/prb12-04107.pdf The petition was signed by Juan Carlos Ruiz Rodriguez, president. =============================== T R I N I D A D & T O B A G O =============================== TRINIDAD CEMENT: Ministry Refers Dispute to Industrial Court ------------------------------------------------------------ Caribbean360.com reports that Ministry of Labor, Small and Micro Enterprise Development Minister Errol McLeod said that the dispute between Trinidad Cement Limited and the Oilfield Workers' Trade Union has been referred to the Trinidad and Tobago Industrial Court. Mr. McLeod revealed that this move had come about after more than a dozen meetings between the two parties, mediated by his ministry, failed to bring about an end to the ongoing industrial dispute that began in January this year and culminated in strike action at the end of February, according to Caribbean360.com. The report relates that the industrial dispute results from the OWTU's attempts to force TCL to budge from its wage offer of 6.5% over a retroactive three-year period to the over 600 workers represented by the union in favor of the OWTU's request for a 12% increase. During a press conference on the new development, McLeod explained that he referred the matter to the Industrial Court under Section 61 (d) of the Industrial Relations Act. Section 61 (d) said that the minister shall refer an unresolved dispute to the court where a period of three months of continuing industrial action has elapsed and a request is made to the minister by either party to refer to the court for final determination, Caribbean360.com notes. Caribbean360.com says that the Ministry had first held conciliatory meetings with TCL and the OWTU since Jan. 31, 2012 and five other conciliatory meetings had followed. The report discloses that the last such meeting was held on February 23 and after that the Union served notice that it was taking strike action. The strike began on February 27. Caribbean360.com says that TCL responded with a lock out and started offering individual employment contracts to workers as of March 5. "Notwithstanding many efforts following the commencement of industrial action, in holding ten separate meetings with the parties during March 13 to April 19, 2012, their positions remained polarized," the report quoted Mr. McLeod as saying. About Trinidad Cement Trinidad Cement Limited is a cement company and is the parent company of Caribbean Cement Company Limited. * * * As reported in the Troubled Company Reporter-Latin America on Oct. 5, 2011, RJR News reports that Trinidad Cement Limited has now reached an agreement with its debtors on the terms and conditions attached to the repayment of its debt. The agreement will convert most of the company's debt into an 8-year facility, to be paid, quarterly, from March 2013, according to RJR News. The report related that deal also includes certain performance criteria for repaying the debt and if those are not met, the company will be penalized. =============== X X X X X X X X =============== * BOND PRICING: For the Week May 28 to June 1, 2012 --------------------------------------------------- Issuer Coupon Maturity Currency Price ------ ------ -------- -------- ----- ARGENTINA --------- ARGENT-$DIS 8.28 12/31/2033 USD 68.3 ARGENT- PAR 1.18 12/31/2038 ARS 39.5 ARGENT- DIS 7.82 12/31/2033 EUR 57.9 ARGENT- DIS 7.82 12/31/2033 EUR 57.3 ARGENT- DIS 7.82 12/31/2033 EUR 59.5 ARGENT- DIS 4.33 12/31/2033 JPY 42 ARGENT- PAR 0.45 12/31/2038 JPY 15 ARGENT- PAR&GDP 0.45 12/31/2038 JPY 8 ARGNT BOGAR 2 2/4/2018 ARS 145 ARGNT-BOCON PRE9 2 3/15/2014 ARS 71.9 BANCO MACRO SA 9.75 12/18/2036 USD 72 BANCO MACRO SA 9.75 12/18/2036 USD 70.4 BANCO MACRO SA 9.75 12/18/2036 USD 70.4 CAPEX SA 10 3/10/2018 USD 71 CAPEX SA 10 3/10/2018 USD 71.9 EMP DISTRIB NORT 9.75 10/25/2022 USD 56.5 EMP DISTRIB NORT 9.75 10/25/2022 USD 57 EMP DISTRIB NORT 10.5 10/9/2017 USD 65.1 PROV BUENOS AIRE 9.625 4/18/2028 USD 63.8 PROV BUENOS AIRE 9.375 9/14/2018 USD 69.1 PROV BUENOS AIRE 10.875 1/26/2021 USD 69.1 PROV BUENOS AIRE 9.375 9/14/2018 USD 68 PROV BUENOS AIRE 10.875 1/26/2021 USD 69.8 TRANSENER 9.75 8/15/2021 USD 59.5 TRANSENER 9.75 8/15/2021 USD 70.4 BRAZIL ------ ANCO BONSUCESSO 9.25 11/3/2020 USD 74.4 BANCO BONSUCESSO 9.25 11/3/2020 USD 70.9 BANCO CRUZEIRO 8.875 9/22/2020 USD 68.9 BANCO CRUZEIRO 8.875 9/22/2020 USD 68.4 BANCO CRUZEIRO 8.25 1/20/2016 USD 75 REDE EMPRESAS 11.125 USD 40 REDE EMPRESAS 11.125 USD 38 REDE EMPRESAS 11.125 USD 47.8 CAYMAN ISLAND ------------- BANCO BPI (CI) 4.15 11/14/2035 EUR 59.1 BCP FINANCE BANK 5.01 3/31/2024 EUR 50 BCP FINANCE BANK 5.31 12/10/2023 EUR 52.5 BCP FINANCE CO 5.543 EUR 32.7 BCP FINANCE CO 4.239 EUR 33.2 BES FINANCE LTD 5.58 EUR 43.2 BES FINANCE LTD 4.5 EUR 51.2 CAM GLOBAL FIN 6.08 12/22/2030 EUR 66.9 CHINA AUTOMATION 7.75 4/20/2016 USD 75.3 CHINA FORESTRY 10.25 11/17/2015 USD 50 CHINA FORESTRY 10.25 11/17/2015 USD 48.1 CHINA SUNERGY 4.75 6/15/2013 USD 52 EFG ORA FUNDING 1.7 10/29/2014 EUR 53.5 ESFG INTERNATION 5.753 EUR 34.9 GOL FINANCE 8.75 USD 77.8 GOL FINANCE 8.75 USD 75 HOME INNS 2 12/15/2015 USD 74.5 HOME INNS 2 12/15/2015 USD 73.2 JINKOSOLAR HOLD 4 5/15/2016 USD 51.8 LDK SOLAR CO LTD 10 2/28/2014 CNY 45.7 LDK SOLAR CO LTD 4.75 4/15/2013 USD 61 LDK SOLAR CO LTD 4.75 4/15/2013 USD 61.6 LDK SOLAR CO LTD 4.75 4/15/2013 USD 61 LUPATECH FINANCE 9.875 USD 74 LUPATECH FINANCE 9.875 USD 71.1 PUBMASTER FIN 6.962 6/30/2028 GBP PUBMASTER FIN 8.44 6/30/2025 GBP PUBMASTER FIN 5.943 12/30/2024 GBP 73 PUNCH TAVERNS 4.767 6/30/2033 GBP 72.4 RENHE COMMERCIAL 11.75 5/18/2015 USD 58.6 RENHE COMMERCIAL 13 3/10/2016 USD 60 RENHE COMMERCIAL 13 3/10/2016 USD 58.8 RENHE COMMERCIAL 11.75 5/18/2015 USD 58.9 SOLARFUN POWER H 3.5 1/15/2018 USD 67.3 SOLARFUN POWER H 3.5 1/15/2018 USD 66.8 SUNTECH POWER 3 3/15/2013 USD 68.8 SUNTECH POWER 3 3/15/2013 USD 69.4 CHILE ----- CGE DISTRIBUCION 3.25 12/1/2012 CLP 20.2 COLBUN SA 3.2 5/1/2013 CLP 49.4 ESVAL S.A. 3.8 7/15/2012 CLP 12.6 MASISA 4.25 10/15/2012 CLP 10 QUINENCO SA 3.5 7/21/2013 CLP 25.6 PROV BUENOS AIRE BANCO SANTANDER 6.1 6/1/2032 USD 62.8 BANCO SANTANDER 6.3 6/1/2032 USD 67.8 PUERTO RICO ----------- PUERTO RICO CONS 6.2 5/1/2017 USD 56.6 PUERTO RICO CONS 6.5 4/1/2016 USD 69.5 VENEZUELA --------- ELEC DE CARACAS 8.5 4/10/2018 USD 73.8 PETROLEOS DE VEN 5.5 4/12/2037 USD 57.5 PETROLEOS DE VEN 5.375 4/12/2027 USD 57 PETROLEOS DE VEN 5.25 4/12/2017 USD 73 VENEZUELA 7 3/31/2038 USD 68 VENEZUELA 7 3/31/2038 USD 69 VENEZUELA 6 12/9/2020 USD 72 VENEZUELA 7.65 4/21/2025 USD 74 *********** 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 *********** 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, Marites O. Claro, Joy A. Agravante, Rousel Elaine T. Fernandez, Valerie U. Pascual, Ivy B. Magdadaro, Frauline S. Abangan, and Peter A. Chapman, Editors. Copyright 2012. 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 Peter Chapman at 240/629-3300. * * * End of Transmission * * *