/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/130111.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 Friday, January 11, 2013, Vol. 14, No. 8 Headlines A R G E N T I N A ALTO PALERMO: Fitch Affirms 'B-' Issuer Default Rating CRESUD SACIF: Fitch Affirms 'B-' Issuer Default Ratings INVERSIONES Y REPRESENTACIONES: Fitch Affirms 'B' IDR B E R M U D A BAY MARITIME: Member Receives Wind-Up Report LSF7 GERMAN: Member Receives Wind-Up Report LSF7 GLOBAL: Members Receive Wind-Up Report LSREF2 GLOBAL: Members Receive Wind-Up Report NEW CASTLE: Members Receive Wind-Up Report B R A Z I L MARFRIG HOLDINGS: Fitch Rates Proposed USD300MM Notes at 'B+/RR4' MARFRIG HOLDINGS: Moody's Rates US$300MM Sr. Unsecured Notes 'B2' MARFRIG HOLDINGS: S&P Assigns 'B+' Rating to $300MM Senior Notes C A Y M A N I S L A N D S AJW OFFSHORE: Liquidators Seek U.S. Recognition ATC LEASING: Shareholder Receives Wind-Up Report BTG PACTUAL: Shareholder Receives Wind-Up Report CHATHAM ASSET: Shareholder Receives Wind-Up Report CHATHAM ASSET MASTER: Shareholders Receive Wind-Up Report CRESCENT PLANECONSULT: Shareholders Receive Wind-Up Report DAMPIER INTERNATIONAL: Shareholders Receive Wind-Up Report DAMPIER MASTER: Shareholders Receive Wind-Up Report DURATION MUNICIPAL: Shareholders Receive Wind-Up Report F&C SELECT: Shareholders Receive Wind-Up Report FCOI II INVESTMENTS: Shareholders Receive Wind-Up Report H.T. CAYMAN: Shareholder Receives Wind-Up Report MOBILE NET: Shareholders Receive Wind-Up Report NORMANDY HILL: Shareholders Receive Wind-Up Report O'CONNOR CREDIT: Shareholders Receive Wind-Up Report O'CONNOR GLOBAL: Shareholders Receive Wind-Up Report PARDUS DPH: Shareholders Receive Wind-Up Report PLATINUM RIVER: Shareholder Receives Wind-Up Report PRG MANAGEMENT: Shareholder Receives Wind-Up Report RP FINANCE III: Shareholder Receives Wind-Up Report SR ROCKVIEW: Shareholders Receive Wind-Up Report WESSEX GOLD: Shareholders Receive Wind-Up Report ZGG CAYMAN: Shareholder Receives Wind-Up Report C O L O M B I A * DOMINICAN REPUBLIC: No Deal Yet With Electricity Firms J A M A I C A * JAMAICA: Sees Lower Imports and Fewer Exports in 2012 M E X I C O VITRO SAB: 5th Cir. Affirms Order Recognizing Mexican Proceeding P U E R T O R I C O * PUERTO RICO: Banks Face Economic Headwinds in 2013, Fitch Says V E N E Z U E L A * VENEZUELA: Faces Increasing Political Uncertainty, Moody's Says - - - - - ================= A R G E N T I N A ================= ALTO PALERMO: Fitch Affirms 'B-' Issuer Default Rating ------------------------------------------------------ Fitch Ratings has affirmed the following ratings of Alto Palermo S.A.: -- Foreign currency Issuer Default Rating (IDR) at 'B-', Rating Outlook Negative; -- Local currency IDR at 'B+', Rating Outlook Negative; -- USD120 million senior unsecured notes due in 2017 at 'B/RR3'; -- National scale rating at 'AA+(arg)', Rating Outlook Stable; -- National scale senior unsecured notes at 'AA+(arg)'; -- National scale equity rating at '1'. The 'RR3' recovery rating reflects good recovery prospects in the event of default. The notching above the soft cap of 'RR4' for bonds issued by Argentine corporates reflects the company's very strong credit profile and its ability to continue to operate should a potential economic and political crisis occur in Argentina. APSA's foreign currency (FC) IDR continues to be constrained at 'B-' by the 'B-' country ceiling assigned to Argentina by Fitch. The company's local currency (LC) IDR is constrained at 'B+' due to the high degree of risk associated with operating in Argentina's real estate industry. The Negative Rating Outlooks that have been assigned to the FC and LC IDRs are in line with ones assigned to Argentina's sovereign ratings and reflect the high degree of uncertainty about the business climate and economic conditions that should persist throughout 2013. APSA's 'B+' LC IDR is supported by the company's strong market position in the Argentine shopping center industry. While debt at APSA is low in relation to cash flow, Fitch has linked the credit quality of APSA with its more highly leveraged parent company, IRSA Inversiones y Representaciones S.A. (IRSA). APSA has a strong business position in the Argentine shopping center industry. The company operates 13 shopping centers with a gross leasable space of approximately 309,000 square meters. The high quality of these malls and their strategic locations result in sales per square meter that exceed the market average and occupancy rates of more than 98%. APSA's revenues are partially hedged against consumer inflation, as the company receives a percentage of the sales made by tenants of its malls. The company's high operating margins are due to leases that result in the tenants paying direct expenses and a percentage of the common expenses. APSA's results are closely correlated with the performance of the economy, which has proven to be quite volatile. APSA shows some concentration in the near term for its lease agreements (36% of lease contracts expiring in fiscal year 2013), as the contracts are generally for 36 months. While this ratio is high for the industry, APSA's strong market position allows it to renew contracts updating leasing terms. Devaluation risk is also present for APSA as most of its cash flow is denominated in Argentine pesos and a substantial part of its debt is in U.S. dollars. This risk is partially mitigated by APSA's dollar-denominated asset portfolio and its long-term debt profile. APSA's leverage is low and its interest coverage is adequate. At Sept. 30, 2012, the company's total debt-to-EBITDA ratio was 0.7x, while its EBITDA-to-interest ratio was 12.7x. APSA had USD125.3 million of total debt, excluding USD32.4 million of convertible notes, which repurchase was approved in the company's last shareholders assembly on Oct. 31, 2012. Only 5% of the company's debt is short term. The company had USD50.4 million of cash and marketable securities at the end of September, covering short-term debt by 7x. APSA is 95.6% owned by IRSA. On a consolidated basis, IRSA had USD364 million of sales and generated USD212 million of EBITDA during the fiscal year ended June 30, 2012. At Sept. 30, 2012, IRSA had USD565.5 million of consolidated debt, resulting in a total debt-to-EBITDA ratio of 2.6x. APSA accounted for only 28% of IRSA's consolidated debt. IRSA's main debt obligations are USD150 million first notes maturing in 2017, USD150 million second notes maturing in 2020, and around USD70 million of third and fourth notes maturing in 2013 and 2014. APSA also has a USD120 million note maturing in 2017. These notes do not have cross guarantees. For this industry, the emphasis of Fitch's methodology is on portfolio quality and diversity, as well as the size of the asset base. APSA's portfolio of assets is strong, with book capital of USD343 million as of Sept. 30, 2012. This value would be higher at market values. These assets are mostly unencumbered, as secured debt represents less than 5% of its total debt load. The large pool of unencumbered assets at APSA provides financial flexibility and results in above-average recovery prospects in the event of default. During the first quarter of fiscal year ended June 30, 2013 (1Q FYE13), APSA had USD42.4 million of EBITDA, a 10.7% improvement from 1Q FYE12. The improvement continues to show the positive performance of the company's shopping centers. Key Rating and Outlook Drivers Fitch expects APSA will manage its balance sheet to a targeted of debt-to-EBITDA ratio under 1.5x. Under a conservative scenario, Fitch estimates the company's interest coverage to be above 5.0x. APSA's management is intent on maintaining a conservative financial structure. Fitch estimates that the company's EBITDA margin will remain above 70%. A significant increase in APSA's targeted leverage ratio would threaten credit quality and could result in a negative rating action. APSA's FC IDR could be affected by an upgrade or downgrade of the Argentine Country Ceiling of 'B-'. CRESUD SACIF: Fitch Affirms 'B-' Issuer Default Ratings ------------------------------------------------------- Fitch Ratings has affirmed the ratings of Cresud S.A.C.I.F. y A. as follows: -- Foreign Currency Issuer Default Rating (IDR) at 'B-'; Outlook Negative; -- Local Currency Issuer Default Rating (IDR) at 'B-'; Outlook Negative; -- USD60 million senior unsecured bullet notes due in 2014 at 'B-/RR4'; -- National Scale at 'AA-(arg)'; Outlook Stable -- National Scale Senior Unsecured Notes at 'AA-(arg)'; -- Equity Rating at Category 1. Cresud's foreign currency (FC) IDR is constrained at 'B-' due to the 'B-' country ceiling of Argentina. Cresud's 'B-' local currency (LC) IDR is constrained by above-average risks associated with operating in the real estate segment in Argentina and the volatile cash flow of its agribusiness division, which is subject to weather conditions and commodity prices. The Negative Rating Outlooks that have been assigned to the FC and LC IDRs are in line with those assigned to Argentina's sovereign ratings and reflect the high degree of uncertainty about the business climate and economic conditions that should persist throughout 2013. Cresud's ratings consider its position as a leading company in the real estate and agribusiness sectors in Argentina. Cresud owns 64.5% of IRSA ('B+' local currency IDR by Fitch), a leading real estate company in Argentina dedicated to real estate development, office rentals, and shopping mall operations through Alto Palermo (APSA), which is 94.9% owned subsidiary of IRSA Inversiones y Representaciones S.A. (IRSA). During the fiscal year ended June 30, 2012, IRSA accounted for all of Cresud's consolidated EBITDA and 66% of its consolidated assets. Cresud has an important portfolio of farms in Argentina and also has a presence in Bolivia, Paraguay, and in Brazil through its 39.64% stake in BrasilAgro. The results from the agribusiness segment were negatively affected during the fiscal year ended June 30, 2012 due to poor weather conditions in Argentina. Fitch links the ratings of Cresud and IRSA. Cresud's 'B-' local currency IDR is notched down from IRSA's 'B+' LC IDR because of the structural subordination of its debt and its weaker stand- alone financial profile. This linkage reflects factors such as strong strategic and operational ties and the fact that IRSA's upstream dividends represent a significant part of Cresud's cash flow from operations. The dividend flow to Cresud from IRSA is expected to be relatively stable. During 2012, Cresud received dividends of USD14 million in June from IRSA and USD24 million in November. The ratings also reflect moderate consolidated leverage, as well as manageable liquidity, as a result of unencumbered assets and land that could be sold. Regarding the real estate industry, the emphasis of Fitch's methodology is on portfolio quality, diversity, and the size of the asset base. Cresud's consolidated portfolio of real estate assets is strong with USD 1.2 billion of book value as of Sept. 30, 2012. This value would be higher at market values. These assets are mostly unencumbered and provide Cresud and its direct and indirect subsidiaries with a degree of financial flexibility. On a consolidated basis, Cresud had USD641 million of sales and generated USD208 million of EBITDA during the fiscal year ended June 30, 2012. These figures compare with USD 858 million of consolidated debt, resulting in a net debt-to-EBITDA ratio of 3.6x and an EBITDA-to-interest expense ratio of 2.3x. Long-term debt accounts for 71% of total debt and includes USD420 million of senior notes at APSA and IRSA that mature between 2017 and 2020. Consolidated EBITDA consists of USD160 million from the shopping mall segment developed by APSA and USD50 million from IRSA (including office rentals, developments, and hotels). The weak performance of the agribusiness segment resulted in a negative EBITDA of USD3 million. These results were mainly in the crop segment and are explained by an important drought during the 2011 - 2012 season and losses from holdings and derivatives in BrasilAgro that carried out its hedging transactions. Fitch expects an improvement in the profitability of the agribusiness segment for the current period. The company's stand-alone debt reached USD239 million as of Sept. 30, 2012. Short-term debt accounted for 31% of Cresud's stand-alone total debt. During 2012, the company extended the average life of its debt through the issuance of approximately USD115 million of senior unsecured notes in the local markets with maturities between 18 and 36 months. Cresud's debt is supported by its asset portfolio. Its main assets include participations in IRSA and BrasilAgro, its portfolio of farms, and its inventory of crops and livestock. A significant portion of Cresud's assets could be sold in traded markets, providing Cresud with additional liquidity to support its short-term debt obligations. POTENTIAL RATING AND OUTLOOK DRIVERS: Fitch expects that Cresud will manage its balance sheet to a consolidated net debt-to-EBITDA ratio of around 4.0x. Any significant increase in Cresud's leverage ratio would weaken credit quality and could result in a negative rating action. Cresud's ratings could be affected by an upgrade or downgrade of the Argentine country ceiling of 'B-'. INVERSIONES Y REPRESENTACIONES: Fitch Affirms 'B' IDR ----------------------------------------------------- Fitch Ratings has affirmed the following ratings of Inversiones y Representaciones S.A.: -- Foreign Currency Issuer Default Rating (IDR) at 'B-' with a Negative Outlook; -- Local Currency IDR at 'B+' with a Negative Outlook; -- USD150 million Senior Unsecured Notes due in 2017 at 'B/RR3'; -- USD 150 million Senior Unsecured Notes due in 2020 at 'B/RR3'; -- National Scale rating at AA+(arg) with a Stable Outlook; -- National Scale Senior Unsecured Notes at AA+(arg); -- National Scale Equity Rating at '1' The 'RR3' recovery rating reflects good recovery prospects in the event of default. The notching above the soft cap of 'RR4' for bonds issued by Argentine corporates reflects the company's strong credit profile and its ability to continue to operate should a potential economic and political crisis occur in Argentina. IRSA's foreign currency (FC) IDR continues to be constrained at 'B-' due to Argentina's 'B-' country ceiling. IRSA's Local Currency (LC) IDR is constrained at 'B+' by above-average risks associated with real estate development in Argentina. Devaluation risk is also present for IRSA as most of its cash flow is denominated in Argentine pesos and a substantial part of its debt is in U.S. dollars. This is partially mitigated by IRSA's dollar- denominated asset portfolio. The Negative Rating Outlooks that have been assigned to the FC and LC IDRs are in line with ones assigned to Argentina's sovereign ratings and reflect the high degree of uncertainty about the business climate and economic conditions that should persist throughout 2013. IRSA's 'B+' LC IDR is supported by its strong performance and positive operating trends. IRSA has a leading position in the shopping center segment within the city of Buenos Aires through its subsidiary, Alto Palermo S.A. (APSA, 95.6% owned). The shopping centers segment accounts for about 75% of IRSA's consolidated operating EBITDA. IRSA is also the leader in the development and management of office buildings in Buenos Aires (14% of consolidated operating EBITDA). The balance of IRSA's operating results is derived from three premium hotels, as well as its residential property development division. IRSA maintains a moderate level of debt, as well as a manageable liquidity position, due to unencumbered assets and land that could be sold. For the real estate industry, the emphasis of Fitch's methodology is on portfolio quality, diversity, and size. IRSA's asset portfolio is strong with USD776 million of book capital as of Sept. 30, 2012. This value would be higher at market values. These assets are mostly unencumbered as secured debt represents less than 5% of total debt. As of Sept. 30, 2012, IRSA had USD566 million of debt, resulting in a total debt-to-EBITDA ratio of 2.7x and an EBITDA-to-interest expense ratio of 3.0x. APSA accounted for only 28% of IRSA's consolidated debt. IRSA's main debt obligations are USD150 million notes maturing in 2017 and 2020. APSA also has a USD120 million note maturing in 2017. These notes do not have cross guarantees. IRSA had USD135.6 million of consolidated short-term debt obligations as of Sept. 30, 2012, of which USD7 million are associated with debt at APSA. These figures compare with USD107 million of cash and marketable securities. Approximately USD50.4 million of the company's cash is at APSA. IRSA is expected to meet its upcoming debt obligations with a mix of cash from operations and the rollover of existing debt. Importantly, both IRSA and APSA own key parcels of land in strategic areas of Buenos Aires, which could be sold to improve the company's liquidity, or used for new developments. The book value of this undeveloped land exceeds USD90 million. Despite lower leverage at its subsidiary APSA, the local currency IDRs of APSA and IRSA have been linked at 'B+'. This linkage reflects factors that align the credit quality of the company, such as strong strategic ties, and the fact that APSA's upstream dividends represent a relevant part of IRSA's cash flow generation. Rating and Outlook Drivers Fitch expects that IRSA will manage its balance sheet to reach a total debt-to-EBITDA ratio of less than 3.5x. Any significant increase in IRSA's targeted leverage ratio would weaken credit quality and could result in a negative rating action. IRSA's FC IDR could be affected by an upgrade or downgrade of the Argentine Country Ceiling of 'B-'. ============= B E R M U D A ============= BAY MARITIME: Member Receives Wind-Up Report -------------------------------------------- The member of Bay Maritime Limited received on Dec. 31, 2012, the liquidator's report on the company's wind-up proceedings and property disposal. The company commenced wind-up proceedings on Nov. 29, 2012. The company's liquidator is: Robin J. Mayor Clarendon House, 2 Church Street Hamilton HM 11 Bermuda LSF7 GERMAN: Member Receives Wind-Up Report ------------------------------------------- The member of LSF7 German Lendings, Ltd. received on Dec. 14, 2012, the liquidator's report on the company's wind-up proceedings and property disposal. The company commenced wind-up proceedings on Nov. 28, 2012. The company's liquidator is: Robin J. Mayor Clarendon House, 2 Church Street Hamilton HM 11 Bermuda LSF7 GLOBAL: Members Receive Wind-Up Report ------------------------------------------- The members of LSF7 Global Lendings, Ltd. received on Dec. 31, 2012, the liquidator's report on the company's wind-up proceedings and property disposal. The company commenced wind-up proceedings on Nov. 27, 2012. The company's liquidator is: Robin J. Mayor Clarendon House, 2 Church Street Hamilton HM 11 Bermuda LSREF2 GLOBAL: Members Receive Wind-Up Report --------------------------------------------- The members of LSREF2 Global Holdings, Ltd. received on Dec. 31, 2012, the liquidator's report on the company's wind-up proceedings and property disposal. The company commenced wind-up proceedings on Nov. 27, 2012. The company's liquidator is: Robin J. Mayor Clarendon House, 2 Church Street Hamilton HM 11 Bermuda NEW CASTLE: Members Receive Wind-Up Report ------------------------------------------ The members of New Castle Market Neutral Offshore Limited received on Dec. 31, 2012, the liquidator's report on the company's wind-up proceedings and property disposal. Robert S. Reitzes is the company's liquidator. =========== B R A Z I L =========== MARFRIG HOLDINGS: Fitch Rates Proposed USD300MM Notes at 'B+/RR4' ----------------------------------------------------------------- Fitch Ratings has assigned an expected rating of 'B+/RR4' rating to Marfrig's proposed USD300 million senior unsecured notes due 2017 to be issued by Marfrig Holdings (Europe) BV. These notes will be unconditionally guaranteed by Marfrig Alimentos S.A. (Marfrig), Marfrig Overseas Ltd and several other subsidiaries. Proceeds are expected to be used to refinance debt maturities and extend debt maturity schedule. A complete list of Fitch's ratings of Marfrig is at the bottom of the press release. The 'B+' rating takes into consideration the company's aggressive growth strategy and high leverage. Further considered in the rating is the volatility of protein prices and profit margins due to factors beyond the company's control. Positive considerations include Marfrig's strong business position as one of the largest producers and exporters of beef, poultry, and pork in Brazil. Ratings Drivers: The Rating Outlook for Marfrig and its rated subsidiaries is Negative. A revision of the Outlook to Stable could be triggered by a number of factors that could include financial improvements which are better than expected given the current operating environment, and/or sufficient capital injections to meaningfully reduce debt. A rating downgrade could be precipitated by a further deterioration in company's credit metrics, negative cash flow generation or liquidity concerns. Fitch views positively the BRL 1 billion equity issuance concluded by the company during October 2012. Along with the current bond issuance this will strengthen liquidity and improve the company's amortization schedule. In Fitch's opinion, the funds raised will be sufficient to address an estimated BRL1.2 billion of debt maturities (other than trade debt) through 2013. Fitch projects that Marfrig's free cash flow generation will be negative in 2013, which will continue to make the company dependent upon external financing, as it faces debt maturities during 2014 of BRL2.8 billion. Additional challenges faced by the company include: integrating the assets acquired in an asset swap with Brazil Foods (BRF), retaining the market share of the brands it received, and the successful launch of a large number of new products in a bid to capture additional market share. Leverage Remains High Despite Recent Equity Issuance: As of Sept. 30, 2012, Marfrig had BRL 12.9 billion of debt and BRL 2.8 billion of cash and marketable securities. During the LTM ended Sept. 30, 2012, the company generated BRL 1.9 billion of EBITDA. Fitch estimates that Marfrig's gross and net debt-to-LTM EBITDA ratios pro forma the equity issuance for the period ended Sept. 30, 2012 were 6.1x and 4.6x, respectively. These ratios compare with 6.8x and 4.8x during 2011. Fitch expects that Marfrig's leverage ratios will remain relatively high through 2013. Earnings Volatility: Protein prices and demand are volatile. Marfrig's profit margins are affected by factors beyond the company's control. These include domestic and international supply and demand imbalances resulting from animal disease and weather conditions, global economic growth, changes in consumption habits, and government- imposed sanitary and trade restrictions. Competitive pressures from other players also affect the company's margins. Strong Business Position: Marfrig is one of Brazil's largest producers and exporters of beef, poultry, and pork. The company has a more diversified business profile than most of its peers. Its production base is diversified and 35% of its sales are from exports. A little over one-third of its revenues come from higher value-added processed food. As a result of the recent asset swap with BRF, processed and prepared product capacities will more than double. Processed Food - Long-Term Positive, Short-Term Volatility: Marfrig's strategy of reducing commodity protein exposure by increasing its share in processed food, which is less volatile and commands better profit margins, is a credit positive. The asset swap with BRF will strengthen Marfrig's competitive position in the value-added protein products market and is consistent with the company's previous acquisitions. Achieving full capacity will take time and the company's efficiency may decline during the integration period which will pressure margins. Fitch currently rates Marfrig: Marfrig Alimentos S.A. -- Local currency IDR at 'B+'; -- Foreign currency IDR at 'B+'; -- National scale rating at 'BBB+(bra)'; -- BRL 300 million 3rd debentures issue (1st tranche) at 'BBB+(bra)'; -- BRL 300 million 3rd debentures issue (2nd tranche) at 'BBB+(bra)'. Marfrig Overseas Ltd -- Foreign currency IDR at 'B+'; -- US$375 million senior unsecured notes due 2016 at 'B+/RR4'; -- US$500 million senior unsecured notes due 2020 at 'B+/RR4'. Marfrig Holdings (Europe) B.V. -- Foreign currency Marfrig Alimentos S.A. -- Local currency IDR at 'B+'; -- Foreign currency IDR at 'B+'; -- National scale rating at 'BBB+(bra)'; -- BRL 300 million 3rd debentures issue (1st tranche) at 'BBB+(bra)'; -- BRL 300 million 3rd debentures issue (2nd tranche) at 'BBB+(bra)'. The Rating Outlook for Marfrig Alimentos S.A., Marfrig Overseas Ltd, and Marfrig Holdings (Europe) B.V. is Negative. The ratings of these companies are linked by Fitch Parent and Subsidiary Linkage criteria. MARFRIG HOLDINGS: Moody's Rates US$300MM Sr. Unsecured Notes 'B2' ----------------------------------------------------------------- Moody's Investors Service assigned a B2 foreign currency rating to Marfrig's proposed issuance of US$300 million senior unsecured notes due 2017. The ratings outlook is stable. Proceeds from the proposed notes will be used to improve the company's capital structure by lengthening its debt profile. Ratings Rationale Marfrig's B2 rating reflects the company's still elevated leverage as measured by adjusted gross debt/EBITDA of 6.4x as of September 2012, and the high amount of short term debt due over the next few quarters. Moreover, about one third of the company's cash position is restricted, linked to long-term export related debt obligation. Following the BRL1.05 billion equity issuance, concluded in December, Moody's expects an improvement in liquidity levels and less pressure coming from short term maturities, said Moody's vice-president Marianna Waltz. The company expects to use most of the proceeds to repay shorter term debt and strengthen its cash position. In Moody's estimates, the equity follow-on, combined with the proposed bond issuance, could represent a total debt reduction of about BRL1.3 billion over the next few quarters. The company also holds, through its subsidiary Keystone, a US$600 million secured revolving long-term credit facility with 17 banks. Of this amount about US$300 million is drawn as of September 2012, with the balance still available. The rating is supported by the company's diversified portfolio of products in five animal proteins (lamb, pork, turkey, poultry and beef) and strong brands, as well as its large geographic footprint and global distribution capabilities. In addition, Moody's see opportunities for the Seara brand in Brazil related not only to the integration of assets exchanged with Brasil Foods, but also to the suspension of certain Perdigao products by the Anti-trust commission (CADE) for a period of three to five years. Moody's is assuming that Brasil Foods will recover the most of Perdigao's market share using the Sadia brand, but in Moody's view Seara could gain some shares nonetheless. The stable outlook reflects Moody's view that Marfrig will be able to keep operating margins near current levels and avoid further significant deterioration in its liquidity over the near term. Marfrig's rating could be downgraded if liquidity were to deteriorate such that unrestricted cash position would represent less than 80% of short term debt. Quantitatively, downward pressure on Marfrig's B2 rating or outlook is likely if Total Debt / EBITDA is sustained above 6.0x, EBITA to gross interest expense falls below 1.0x or if Retained Cash Flow to Net Debt is below 10%. All credit metrics are according to Moody's standard adjustments and definitions. The ratings or outlook could be upgraded if Marfrig is able to improve liquidity and keep operating margins at least near current levels. In addition, it would require a CFO/ Net Debt approaching 15% and a Total Debt / EBITDA of near 4.5x. Marfrig, headquartered in Sao Paulo, Brazil, is among the largest protein companies globally, with reported net consolidated revenues of BRL23.5 billion (US$11.7 billion) in the 12 months ended in September, 2012. With two main divisions, which are Seara Foods and Marfrig Beef, the company currently has 108 beef, poultry, pork and lamb processing plants. The company processes, packages and delivers fresh, chilled and processed beef, chicken, pork and lamb products to customers in Brazil and abroad, with approximately 30% of global sales derived from international markets. In the past few years Marfrig has focused on non-organic growth and made 18 acquisitions, the most important ones being Moy Park (2008), Seara (2009) and Keystone (2010). The principal methodology used in rating Marfrig was the Global Food - Protein and Agriculture Industry Methodology published in September 2009. MARFRIG HOLDINGS: S&P Assigns 'B+' Rating to $300MM Senior Notes ---------------------------------------------------------------- Standard & Poor's Ratings Services said that it assigned its 'B+' rating to Marfrig Holdings Europe B.V.'s planned $300 million senior unsecured notes due 2017. The rating on the issue reflects the credit quality of both Brazil-based Marfrig Alimentos S.A. (Marfrig; B+/Negative/--), which will irrevocably and unconditionally guarantee the bonds, and its most relevant operating subsidiaries; we analyze these as a single group. The proposed bond issuance, together with the company's recent equity offering through which Marfrig raised about R$1 billion (or about $500 million), will improve its capital structure by reducing overall debt and extending its maturities, lowering the company's annual refinancing risks and sizable interest rate burden. "We expect Marfrig to continue this deleveraging trend and use most of the proceeds of both transactions to pay down debt as it comes due," said Standard & Poor's credit analyst Flavia Bedran. We also expect operating performance to improve thanks to both strong cash flows from its beef division and a gradual recovery in its poultry unit, as grain prices have softened. However, the outlook on the company's corporate credit rating remains negative as Marfrig confronts the volatility of the beef and poultry industry and the need to improve operating efficiencies to generate stronger discretionary cash flows. RATINGS LIST Marfrig Alimentos S.A. Corporate credit rating B+/Negative/-- Rating Assigned Marfrig Holdings Europe B.V. $300M sr unsec notes B+ ========================== C A Y M A N I S L A N D S ========================== AJW OFFSHORE: Liquidators Seek U.S. Recognition ----------------------------------------------- Liquidators of AJW Offshore, Ltd., and three affiliates filed Chapter 15 petitions (Bankr. E.D.N.Y. Case No. 8-70078) on Jan. 7, 2013 in Central Islip, New York, in the United States to seek recognition of the liquidation supervised by the Cayman Islands Grand Court. Before succumbing to liquidation, the Offshore Funds were engaged in private investments in public equities (PIPE). They traded at the distressed end of the market, predominantly providing funding to businesses that could not obtain financing from traditional sources. By mid-to-late 2007, the PIPE investment strategy began to fail. Many of the companies that received financing from the Offshore Funds were struggling, on the verge of bankruptcy, or defunct. Many defaulted on their loan and conversion obligations. According to the liquidators, the funds' manager, Corey Ribotsky, rather than disclose these facts and write down the fair value of the funds, chose to "restructure" the outstanding debt by issuing new debenture to the same delinquent and nonperforming companies. Mr. Ribotsky allegedly rolled the outstanding principal, interest and default penalties into new debentures which provided even greater conversion discounts for the issuer's shares. The U.S. Securities and Exchange Commission instituted an investigation into the management of the Offshore Funds and certain U.S.-based funds. A lawsuit was filed against Mr. Ribotsky and NIR in September 2011 citing allegations of, among other things, artificially inflating the financial performance of the AJW Funds, and impermissibly transferring money from certain Offshore Funds to other funds to satisfy redemption requests. Because the funds were unable to pay their debts with interest for the next 12 months, the Cayman Islands Grand Court in 2011 ordered the entities' liquidation come under the court's supervision and appointed PwC Corporate Finance & Recovery (Cayman) Limited's Ian Stoke and David Walker as joint official liquidators. The liquidators are currently in the midst of a lengthy and complex liquidation process. Assets of the offshore Funds fall into four categories: 1. $427,000 in cash in bank and brokerage accounts in the U.S. and Cayman Islands. 2. callable secured convertible notes and warrants issued largely by U.S. entities for which U.C.C. filings are required to perfect securities interest over the assets; 3. causes of action against various issuers; 4. potential claims against Mr. Ribotky, NIR Group LLC, Offshore Funds professionals, almost all of whom are located in the U.S. The liquidators are asking the U.S. Bankruptcy Court to recognize the Cayman Islands Proceedings as foreign main proceedings to garner and administer the Offshore Funds' assets that may be located and held in the U.S. The liquidators note that, considering that the allegations in the SEC complaint predate 2007, the fear that the causes of action have imminent expiry date. Accordingly, they request an order that explicitly acknowledges that the statutory tolling and extension provided for in Sec. 108 of the Bankruptcy Code apply for the Offshore Funds. The liquidators note that the Cayman Islands Proceedings provide for a centralized process to assert and resolve claims against the Offshore Funds' estates, and to make distributions to the Offshore Funds' creditors. ATC LEASING: Shareholder Receives Wind-Up Report ------------------------------------------------ The shareholder of ATC Leasing Limited received on Dec. 14, 2012, the liquidators' report on the company's wind-up proceedings and property disposal. The company's liquidators are: Roger Priaulx Edel Andersen c/o Genesis Trust & Corporate Services Ltd. Midtown Plaza, 2nd Floor Elgin Avenue, George Town Grand Cayman KY1-1106 Cayman Islands Telephone: (345) 945 3466 Facsimile: (345) 945 3470 BTG PACTUAL: Shareholder Receives Wind-Up Report ------------------------------------------------ The shareholder of BTG Pactual Special Purpose Fund, Ltd. received on Nov. 30, 2012, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Ogier c/o Ben Gillooly Telephone: (345) 815 1764 Facsimile: (345) 949-9877 CHATHAM ASSET: Shareholder Receives Wind-Up Report -------------------------------------------------- The shareholder of Chatham Asset Partners Special Situations Offshore Fund, Ltd. received on Dec. 7, 2012, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Ogier c/o Jennifer Parsons Telephone: (345) 815-1820 Facsimile: (345) 949-9877 CHATHAM ASSET MASTER: Shareholders Receive Wind-Up Report --------------------------------------------------------- The shareholders of Chatham Asset Partners Special Situations Master Fund, Ltd. received on Dec. 7, 2012, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Ogier c/o Jennifer Parsons Telephone: (345) 815-1820 Facsimile: (345) 949-9877 CRESCENT PLANECONSULT: Shareholders Receive Wind-Up Report ---------------------------------------------------------- The shareholders of Crescent Planeconsult Group received on Dec. 12, 2012, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Linburgh Martin Intertrust (Cayman) Limited Harbour Place, Fourth Floor P.O. Box 1034 Grand Cayman KYI-1102 Cayman Islands DAMPIER INTERNATIONAL: Shareholders Receive Wind-Up Report ---------------------------------------------------------- The shareholders of Dampier International Fund Ltd. received on Dec. 10, 2012, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Ian Stokoe c/o Devina Patel Telephone: (345) 914 8739 Facsimile: (345) 945 4237 P.O. Box 258 Grand Cayman KY1-1104 Cayman Islands DAMPIER MASTER: Shareholders Receive Wind-Up Report --------------------------------------------------- The shareholders of Dampier Master Fund Ltd. received on Dec. 10, 2012, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Ian Stokoe c/o Devina Patel Telephone: (345) 914 8739 Facsimile: (345) 945 4237 P.O. Box 258 Grand Cayman KY1-1104 Cayman Islands DURATION MUNICIPAL: Shareholders Receive Wind-Up Report ------------------------------------------------------- The shareholders of Duration Municipal Offshore Fund, Ltd. received on Nov. 30, 2012, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: K.D. Blake c/o Eleanore Laureles Telephone: +1 345-914-4466/+1 345-949-4800 Facsimile: +1 345-949-7164 P.O. Box 493 Grand Cayman KY1-1106 Cayman Islands F&C SELECT: Shareholders Receive Wind-Up Report ----------------------------------------------- The shareholders of F&C Select Alpha Fund Of Hedge Funds Limited received on Dec. 29, 2012, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Mark Longbottom c/o Camele Burke Kinetic Partners (Cayman) Limited The Harbour Centre, 42 North Church Street PO Box 10387 Grand Cayman KY1-1004 Cayman Islands Telephone: (345) 623 9904 Facsimile: (345) 943 9900 FCOI II INVESTMENTS: Shareholders Receive Wind-Up Report -------------------------------------------------------- The shareholders of FCOI II Investments Ltd. received on Dec. 7, 2012, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Intertrust Corporate Services (Cayman) Limited 87 Mary Street, George Town Grand Cayman, KY1-9002 Cayman Islands c/o Jennifer Chailler Telephone: (345) 814 6847 H.T. CAYMAN: Shareholder Receives Wind-Up Report ------------------------------------------------ The shareholder of H.T. Cayman Ltd received on Dec. 10, 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 MOBILE NET: Shareholders Receive Wind-Up Report ----------------------------------------------- The shareholders of Mobile Net Invest Limited received on Dec. 12, 2012, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: H&J Corporate Services (Cayman) Ltd. Telephone: (345) 949 7555 NORMANDY HILL: Shareholders Receive Wind-Up Report -------------------------------------------------- The shareholders of Normandy Hill Offshore Fund Ltd. received on Dec. 7, 2012, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Intertrust Corporate Services (Cayman) Limited 87 Mary Street, George Town Grand Cayman KY1-9002 Cayman Islands c/o Jennifer Chailler Telephone: (345) 814 6847 O'CONNOR CREDIT: Shareholders Receive Wind-Up Report ---------------------------------------------------- The shareholders of O'Connor Credit Opportunity Master Limited received on Dec. 12, 2012, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Matthew Wright c/o Omar Grant Telephone: (345) 949-7576 Facsimile: (345) 949-8295 P.O. Box 897 Windward 1 Regatta Office Park Grand Cayman KY1-1103 Cayman Islands O'CONNOR GLOBAL: Shareholders Receive Wind-Up Report ---------------------------------------------------- The shareholders of O'Connor Global Convertible Bond Limited received on Dec. 12, 2012, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Matthew Wright c/o Omar Grant Telephone: (345) 949-7576 Facsimile: (345) 949-8295 P.O. Box 897 Windward 1 Regatta Office Park Grand Cayman KY1-1103 Cayman Islands PARDUS DPH: Shareholders Receive Wind-Up Report ----------------------------------------------- The shareholders of Pardus DPH Holding Ltd. received on Dec. 7, 2012, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Intertrust Corporate Services (Cayman) Limited 87 Mary Street, George Town Grand Cayman KY1-9002 Cayman Islands c/o Jennifer Chailler Telephone: (345) 814 6847 PLATINUM RIVER: Shareholder Receives Wind-Up Report --------------------------------------------------- The shareholder of Platinum River Growth Fund I received on Dec. 3, 2012, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Patrik Vonmoos Wiedingstrasse 98 8045 Zurich, Switzerland Telephone: +41 43 333 0551 Facsimile: +41 44 450 1536 PRG MANAGEMENT: Shareholder Receives Wind-Up Report --------------------------------------------------- The shareholder of PRG Management Ltd. received on Dec. 3, 2012, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Patrik Vonmoos Wiedingstrasse 98 8045 Zurich, Switzerland Telephone: +41 43 333 0551 Facsimile: +41 44 450 1536 RP FINANCE III: Shareholder Receives Wind-Up Report --------------------------------------------------- The shareholder of RP Finance III received on Dec. 7, 2012, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: David Dyer Telephone: (345)949-8244 Facsimile: (345)949-5223 P.O. Box 1984 Grand Cayman KY1-1104 Cayman Islands SR ROCKVIEW: Shareholders Receive Wind-Up Report ------------------------------------------------ The shareholders of SR Rockview Master MA Ltd. received the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Swiss Re Services Limited 30 St Mary's Axe London WESSEX GOLD: Shareholders Receive Wind-Up Report ------------------------------------------------ The shareholders of Wessex Gold Fund Limited received on Nov. 29, 2012, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Mark Longbottom c/o Camele Burke Kinetic Partners (Cayman) Limited The Harbour Centre, 42 North Church Street PO Box 10387 Grand Cayman KY1-1004 Cayman Islands Telephone: (345) 623 9904 Facsimile: (345) 943 9900 ZGG CAYMAN: Shareholder Receives Wind-Up Report ----------------------------------------------- The shareholder of ZGG Cayman Holding Limited received on Dec. 14, 2012, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidators are: Roger Priaulx Edel Andersen c/o Genesis Trust & Corporate Services Ltd. Midtown Plaza, 2nd Floor Elgin Avenue, George Town Grand Cayman Cayman Islands KY1-1106 Telephone: (345) 945 3466 Facsimile: (345) 945 3470 =============== C O L O M B I A =============== * DOMINICAN REPUBLIC: No Deal Yet With Electricity Firms -------------------------------------------------------- Ruben Jimenez Bichara at Dominican Today reports that there is still no agreement between the Dominican Electricity Companies Corporation (CDEEE) and power generators. Dominican Republic Industry Electricity Association (ADIE) Executive Vice President Milton Morrison denied that the existence of such an agreement and stated that there have been some meetings with some generators in order to make them know the CDEEE interest in reaching a pact on the payment of the Government's debt, according to Dominican Today. As reported in the Troubled Company Reporter-Latin America on Jan. 8, 2012, the Dominican Today said that the Dominican Republic State-owned Electric utility (CDEEE) Chief Executive Officer Ruben Jimenez Bichara said that the government had reached said an agreement with the power companies to be disclosed this month. Mr. Bichara spoke after a meeting with President Danilo Medina, but declined to provide details on the pact, according to Dominican Today. The report related that the government owes the power companies more than US$1.0 billion. Mr. Jimenez noted that since he took office, Mr. Medina negotiates with the power companies to solve the energy crisis and pay the Government's debt, the report disclosed. ============= J A M A I C A ============= * JAMAICA: Sees Lower Imports and Fewer Exports in 2012 ------------------------------------------------------- RJR News reports that Jamaica has seen lower imports and exported fewer goods to the rest of the world in between January and September last year. Total imports during that period were valued at US$4.8 billion while exports were valued at US$1.2 billion, according to RJR News. The report relates that the United States is Jamaica's biggest market in terms of both exports and imports. The report says that up to September last year, which is the latest available data, Jamaica imported goods from the United States, worth US$1.6 billion. Venezuela was second, from which imports are chiefly oil under the Petrocaribe agreement, RJR News notes. RJR News relates that the Bolivarian Republic replaces Trinidad and Tobago, which fell to the third largest source of imports for the country. Of the top five import partners, Trinidad and Tobago was the only country from which Jamaica took fewer imports, RJR News says. RJR News says relays that China and Japan were the fourth biggest source of imports for Jamaica. The fourth and fifth largest export markets were Slovenia and Latvia, the report discloses. In 2011 nothing was exported to Latvia in but in 2012, it was the fifth biggest market for Jamaican products, RJR News adds. =========== M E X I C O =========== VITRO SAB: 5th Cir. Affirms Order Recognizing Mexican Proceeding ---------------------------------------------------------------- The U.S. Court of Appeals for the Fifth Circuit affirmed the lower courts' judgment recognizing Vitro S.A.B. de C.V.'s Mexican reorganization proceeding and the appointment of foreign representatives. The Fifth Circuit also affirmed the bankruptcy court's order denying enforcement of the Mexican reorganization plan. The Ad Hoc Group of Vitro Noteholders, a group of creditors holding a substantial amount of Vitro's debt, took an appeal from the district court's decision affirming the bankruptcy court's recognition of the Mexican reorganization proceeding and Vitro's appointed foreign representatives under Chapter 15 of the Bankruptcy Code. Vitro and one of its largest third-party creditors, Fintech Investments, Ltd., each took an appeal directly to the Fifth Circuit from the bankruptcy court's decision denying enforcement of the Mexican reorganization plan because the plan would extinguish the obligations of non-debtor guarantors. The Fifth Circuit appeals are: AD HOC GROUP OF VITRO NOTEHOLDERS, Appellant, v. VITRO SAB DE CV, Appellee; VITRO SAB DE CV, Appellant, v. AD HOC GROUP OF VITRO NOTEHOLDERS; WILMINGTON TRUST, NATIONAL ASSOCIATION, solely in its capacity as indenture trustee; U.S. BANK NATIONAL ASSOCIATION, Appellees; FINTECH INVESTMENTS, LIMITED, Appellant, v. AD HOC GROUP OF VITRO NOTEHOLDERS; WILMINGTON TRUST, NATIONAL ASSOCIATION, solely in its capacity as indenture trustee; U.S. BANK NATIONAL ASSOCIATION, Appellees. No. 12-10542, Consolidated with No. 12-10689., 12-10750 (5th Cir.). A copy of the Fifth Circuit's Jan. 7, 2013 decision is available at http://is.gd/h1Ah8Vfrom Leagle.com. The Fifth Circuit panel consists of Circuit Judges Carolyn Dineen King, Jerry Edwin Smith, and Rhesa Hawkins Barksdale. Judge King penned the decision. About Vitro SAB Headquartered in Monterrey, Mexico, Vitro, S.A.B. de C.V. (BMV: VITROA; NYSE: VTO), through its two subsidiaries, Vitro Envases Norteamerica, SA de C.V. and Vimexico, S.A. de C.V., is a global glass producer, serving the construction and automotive glass markets and glass containers needs of the food, beverage, wine, liquor, cosmetics and pharmaceutical industries. Vitro is the largest manufacturer of glass containers and flat glass in Mexico, with consolidated net sales in 2009 of MXN23,991 million (US$1.837 billion). Vitro defaulted on its debt in 2009, and sought to restructure around US$1.5 billion in debt, including US$1.2 billion in notes. Vitro launched an offer to buy back or swap US$1.2 billion in debt from bondholders. The tender offer would be consummated with a bankruptcy filing in Mexico and Chapter 15 filing in the United States. Vitro said noteholders would recover as much as 73% by exchanging existing debt for cash, new debt or convertible bonds. Concurso Mercantil & Chapter 15 Proceedings Vitro SAB on Dec. 13, 2010, filed its voluntary petition for a pre-packaged Concurso Plan in the Federal District Court for Civil and Labor Matters for the State of Nuevo Leon, commencing its voluntary concurso mercantil proceedings -- the Mexican equivalent of a prepackaged Chapter 11 reorganization. Vitro SAB also commenced parallel proceedings under Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 10-16619) in Manhattan on Dec. 13, 2010, to seek U.S. recognition and deference to its bankruptcy proceedings in Mexico. Early in January 2011, the Mexican Court dismissed the Concurso Mercantil proceedings. But an appellate court in Mexico reinstated the reorganization in April 2011. Following the reinstatement, Vitro SAB on April 14, 2011, re-filed a petition for recognition of its Mexican reorganization in U.S. Bankruptcy Court in Manhattan (Bankr. S.D.N.Y. Case No. 11-11754). The Vitro parent received sufficient acceptances of its reorganization by using the US$1.9 billion in debt owing to subsidiaries to vote down opposition by bondholders. The holders of US$1.2 billion in defaulted bonds opposed the Mexican reorganization plan because shareholders could retain ownership while bondholders aren't being paid in full. Vitro announced in March 2012 that it has implemented the reorganization plan approved by a judge in Monterrey, Mexico. In the present Chapter 15 case, the Debtor seeks to block any creditor suits in the U.S. pending the reorganization in Mexico. Chapter 11 Proceedings A group of noteholders opposed the exchange -- namely Knighthead Master Fund, L.P., Lord Abbett Bond-Debenture Fund, Inc., Davidson Kempner Distressed Opportunities Fund LP, and Brookville Horizons Fund, L.P. Together, they held US$75 million, or approximately 6% of the outstanding bond debt. The Noteholder group commenced involuntary bankruptcy cases under Chapter 11 of the U.S. Bankruptcy Code against Vitro Asset Corp. (Bankr. N.D. Tex. Case No. 10-47470) and 15 other affiliates on Nov. 17, 2010. Vitro engaged Susman Godfrey, L.L.P. as U.S. special litigation counsel to analyze the potential rights that Vitro may exercise in the United States against the ad hoc group of dissident bondholders and its advisors. A larger group of noteholders, known as the Ad Hoc Group of Vitro Noteholders -- comprised of holders, or investment advisors to holders, which represent approximately US$650 million of the Senior Notes due 2012, 2013 and 2017 issued by Vitro -- was not among the Chapter 11 petitioners, although the group has expressed concerns over the exchange offer. The group says the exchange offer exposes Noteholders who consent to potential adverse consequences that have not been disclosed by Vitro. The group is represented by John Cunningham, Esq., and Richard Kebrdle, Esq. at White & Case LLP. A bankruptcy judge in Fort Worth, Texas, denied involuntary Chapter 11 petitions filed against four U.S. subsidiaries. On April 6, 2011, Vitro SAB agreed to put Vitro units -- Vitro America LLC and three other U.S. subsidiaries -- that were subject to the involuntary petitions into voluntary Chapter 11. The Texas Court on April 21 denied involuntary petitions against the eight U.S. subsidiaries that didn't consent to being in Chapter 11. Kurtzman Carson Consultants is the claims and notice agent to Vitro America, et al. Alvarez & Marsal North America LLC, is the Debtors' operations and financial advisor. The official committee of unsecured creditors appointed in the Chapter 11 cases of Vitro America, et al., has selected Sarah Link Schultz, Esq., at Akin Gump Strauss Hauer & Feld LLP, in Dallas, Texas, and Michael S. Stamer, Esq., Abid Qureshi, Esq., and Alexis Freeman, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, as counsel. Blackstone Advisory Partners L.P. serves as financial advisor to the Committee. The U.S. Vitro companies sold their assets to American Glass Enterprises LLC, an affiliate of Sun Capital Partners Inc., for US$55 million. U.S. subsidiaries of Vitro SAB are having their cases converted to liquidations in Chapter 7, court records in January 2012 show. In December, the U.S. Trustee in Dallas filed a motion to convert the subsidiaries' cases to liquidations in Chapter 7. The Justice Department's bankruptcy watchdog said US$5.1 million in bills were run up in bankruptcy and hadn't been paid. On June 13, 2012, U.S. Bankruptcy Judge Harlin "Cooter" Hale in Dallas entered a ruling that precluded Vitro from enforcing its Mexican reorganization plan in the U.S. Vitro's appeal is pending. In November, the U.S. Court of Appeals Judge Carolyn King ruled that Vitro SAB won't be permitted to enforce its bankruptcy reorganization plan in the U.S. She said that Vitro "has not shown that there exist truly unusual circumstances necessitating the release" preventing bondholders from suing subsidiaries. ===================== P U E R T O R I C O ===================== * PUERTO RICO: Banks Face Economic Headwinds in 2013, Fitch Says ---------------------------------------------------------------- Fitch Ratings expects Puerto Rican banks to face continuing operating challenges in 2013, despite recent efforts by those institutions to build capital and derisk their balance sheets. Weak economic fundamentals in Puerto Rico will likely persist this year, and banks will face ongoing risks of rising asset quality pressure. The Puerto Rican economy has been in recession since 2006, and a newly elected governor (who took office last week) must confront continuing budget deficits, very high debt levels, and substantial unfunded pension liabilities. These issues threaten to restrain GDP growth in coming years, potentially delaying a recovery in the island's weak labor market and a rebound in real estate prices. The Puerto Rican unemployment rate, while down from post-financial crisis highs, remains above 13%. In light of the weak macro backdrop, as well as commercial and residential real estate markets that remain stressed, Puerto Rican banks will be forced to maintain high capital levels to absorb shocks that could drive net charge-off (NCO) and nonperforming loan (NPL) levels higher in 2013. Although growth in problem assets slowed in 2011 and 2012, NPLs remain stubbornly high, and NCOs could increase if the island's economic growth falters and financial pressure on borrowers builds. We believe reserve levels will remain higher than comparable figures for U.S. mainland banks. The overwhelming majority of problem loans in the local market are related to commercial real estate and construction lending. While non-accrual loans in residential home lending remain high at 7% for total residential mortgages for all banks, NCOs have not risen significantly. This reflects the fact that the Puerto Rican housing market has limited rental properties on the island. Borrowers have few housing options and generally are committed to remain in their homes despite financial pressures. Most banks have stated an average self-cure rate of 70% for residential nonperforming loans. In addition, conventional mortgages account for 85% of home loans on the island as Alt-A loan products were not used as extensively as they were on the U.S. mainland. Nonetheless, the prolonged recession and weak economic prospects may have negative implications for future trends regarding net losses from residential mortgages. Consumer and commercial lending performance, in contrast to real estate, has held up reasonably well through the economic downturn. Excluding residential mortgages, consumer nonaccruals (NALs) for all commercial banks in Puerto Rico remain low at roughly 1.0% of total loans in third-quarter 2012. Commercial and industrial loans are also holding up with NAL estimated at 2.5% for third-quarter 2012. None of the three Puerto Rican banks rated by Fitch -- Popular, Inc., First Bancorp, and Doral Financial Corp. -- currently have an investment-grade rating. Fitch also rates Santander Bancorp, which has a Viability Rating of 'bb+'. This reflects the impact of the prolonged recession and high unemployment on asset quality in the real estate sector, as well as the still-elevated levels of nonperforming assets. ================= V E N E Z U E L A ================= * VENEZUELA: Faces Increasing Political Uncertainty, Moody's Says ----------------------------------------------------------------- Moody's Investors Service said that with Venezuela's President Hugo Chavez unable to attend the inauguration for his next Presidential term originally scheduled to take place on Thursday, January 10 due to his seemingly terminal cancer, Venezuela faces a period of heightened political uncertainty. The current situation appears to revive the possibility that an opposition candidate could take over the presidency and with it begin to usher in economic reforms that could improve Venezuela's credit picture in the medium term. Regardless of who succeeds Mr. Chavez and which part of the political spectrum they represent, however, this potential opportunity is outweighed in the shorter term by risks associated with the political transition that could negatively impact Venezuela's rating if they crystallize. While the Constitution seemingly requires that elections be called within 30 days if Mr. Chavez is unable to attend the inauguration, the Chavistas are currently arguing that this is in fact not the case. The longer the current situation persists the greater the likelihood of social and political unrest. The opposition would not stand idly by if they perceive the Chavistas to be attempting to solidify their grasp on power through extra-constitutional means. Even if elections are called promptly, Moody's believes the likelihood of an opposition victory is limited. The recent Presidential and regional elections have re-legitimized the Chavista movement while calling the level of support for the opposition into question. Although the expected Chavista candidate, Vice President Nicolas Maduro, is generally not regarded as a very strong candidate on his own, he will likely benefit from a large sympathy vote. Although the Chavista movement is in fact a coalition of fairly disparate interest groups that has been held together by Mr. Chavez, Moody's does not think it is likely to fall apart simply due to his absence. Most likely there will be a behind -- the-scenes power struggle, notwithstanding Mr. Maduro's recent public anointment as Mr. Chavez's preferred successor. As long as it retains power, however, the movement is expected to present an external image of unity, as it has been doing since Mr. Chavez's most recent bout of illness began. That said, Mr. Chavez's successor will be challenged to establish his authority over rivals, which may prevent him from making urgently needed adjustments to the exchange rate and government spending levels -- adjustments that would be painful for significant portions of the population. A related risk given the country's very weak public institutions is that without the discipline provided by Mr. Chavez' presence, corruption may spiral out of control as individuals within the government could be tempted into a race for spoils before increasing macroeconomic imbalances cause the economy to collapse. If assets in the government's various off-budget funds, or even actual oil shipments, start to go missing as a result, this would have a direct negative impact on credit quality. Even if the opposition manages to win the elections, it will lack the mandate that it would have had if Capriles had defeated Mr. Chavez head-to-head in October, which will make it more difficult to implement any meaningful but likely disruptive reforms. There is the risk of civil unrest in this circumstance as well as the Chavistas most assuredly will not go gently into the night. *********** 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., Washington, D.C., 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 2013. 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$775 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 A. Chapman at 215-945-7000 or Nina Novak at 202-241-8200. * * * End of Transmission * * *