/raid1/www/Hosts/bankrupt/TCRLA_Public/181001.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, October 1, 2018, Vol. 19, No. 194
Headlines
A R G E N T I N A
ARGENTINA: Economic Crisis Could Still Worsen Before 2019 Recovery
B O L I V I A
BOLIVIA: Reforms Judiciary Amid Controversy
B R A Z I L
EMBRAER SA: Fined for Bribery in Dominican Republic
TRIZ VENTURES: Sale of Audi Approved by Court
C H I L E
GEOPARK LTD: S&P Affirms 'B+' Issuer Credit Rating, Outlook Stable
C O L O M B I A
CREDIVALORES CREDISERVICIOS: S&P Affirms B+ LT ICR, Outlook Neg.
C O S T A R I C A
COSTA RICA: Thousands March in Capital Amid Ongoing Strike
E C U A D O R
ECUADOR: To Get $100MM-IDB Loan for Electric System Improvement
P U E R T O R I C O
TOYS "R" US: Seeks to Hire CBRE Inc. as Real Estate Broker
X X X X X X X X X
LATAM: IDB Says Gov. Spending Waste Costs 4.4% of GDP in Region
* BOND PRICING: For the Week September 24 to September 28, 2018
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A R G E N T I N A
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ARGENTINA: Economic Crisis Could Still Worsen Before 2019 Recovery
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EFE News reports that Argentina's economic crisis could still
worsen this year, though a recovery is expected for 2019 as long
as the country continues to receive assistance from the
International Monetary Fund (IMF), Fausto Spotorno, chief
economist of the OJF consulting firm, told EFE during an interview
in Buenos Aires.
"For now, the crisis is exclusively linked to the balance of
payments and a very fast reversal of capital flows. The country
began to experience a lack of foreign currencies and the Argentine
peso violently depreciated," the report quoted Mr. Spotorno as
saying.
According to the analyst, the crisis was not all that surprising,
as there were "many warning signs," like a "very large" fiscal
deficit that Argentina funded by means of a foreign debt that was
no longer sustainable, and rising interest rates in the United
States, which led to a drop in foreign investments in emerging
markets, especially since April, the report notes.
It was precisely at the end of April that these factors led to a
sharp depreciation of the Argentine peso, which was aggravated by
lower-than-expected agricultural exports, as the sector was hit by
a drought, the report relays.
According to Mr. Spotorno, the government of Mauricio Macri, who
was sworn in at the end of 2015, should have carried out deeper
structural reforms, and at a faster pace, though his
administration opted for "gradualist" changes to avoid the
political costs, the report notes.
The report discloses that these gradualist changes, however,
required continued public-sector funding, which was unsustainable,
the analyst said.
Mr. Spotorno explained that the crisis led to two major problems:
inflation and a recession, the report says.
According to the economist, the 4.2 percent drop in GDP during the
second quarter of the year is linked to the drought, "and now a
specific recession from this crisis will be experienced in the
fourth quarter and we expect it to last until the first quarter of
2019," the report relays.
While the government expects the GDP to decrease 2.5 percent this
year and 0.5 percent in 2019, the OJF consulting firm has
projected a 1.9 percent drop in GDP this year and a 2.1 percent
rise in 2019, the report notes.
"I am optimistic. The conditions for growth next year are better
because the harvest is expected to improve and the depreciation of
the peso will help increase exports and lead to short-term growth,
while interest rates will tend to decrease," the report quoted Mr.
Spotorno as saying.
"The basic assumption is that the government will meet its fiscal
goals and receive all the support it needs from the IMF. If not,
this could be a whole different story," the economist said, the
report adds.
As reported in the Troubled Company Reporter-Latin America on
Sept. 4, 2018, S&P Global Ratings placed on Aug. 31, 2018, its
'B+' long-term and 'B' short-term sovereign credit ratings on
Argentina on CreditWatch with negative implications. At the same
time, S&P placed its 'raAA' national scale rating on CreditWatch
negative and affirmed its 'BB-' transfer and convertibility
assessment. The CreditWatch negative reflects the risk of
worsening creditworthiness due to potentially weakened
implementation of the government's strategy to stabilize the
economy. Exchange rate volatility, as shown by recent pressure on
the Argentine currency, could jeopardize the effective
implementation of economic adjustment measures, absent further
steps to boost investor confidence. Consequently, S&P Global
Ratings corrected its short-term ratings on Argentina
by removing them from CreditWatch with negative implications.
Fitch Ratings affirmed on May 8, 2018, Argentina's Long-Term
Foreign-Currency Issuer Default Rating (IDR) at 'B' and revised
the Outlook to Stable from Positive.
On December 4, 2017, Moody's Investors Service upgraded the
Government of Argentina's local and foreign currency issuer and
senior unsecured ratings to B2 from B3. The senior unsecured
shelves were upgraded to (P)B2 from (P)B3. The outlook on the
ratings is stable. At the same time, Argentina's short-term
rating was affirmed at Not Prime (NP). The senior unsecured
ratings for unrestructured debt were affirmed at Ca and the
unrestructured senior unsecured shelf affirmed at (P)Ca.
As previously reported by the TCR-LA, Argentina defaulted on some
of its debt late July 30, 2014, after expiration of a 30- grace
period on a US$539 million interest payment. Earlier that ,
talks with a court-appointed mediator ended without resolving a
standoff between the country and a group of hedge funds seeking
full payment on bonds that the country had defaulted on in 2001.
A U.S. judge had ruled that the interest payment couldn't be made
unless the hedge funds led by Elliott Management Corp., got the
US$1.5 billion they claimed. The country hasn't been able to
access international credit markets since its US$95 billion
default 13 years ago. On March 30, 2016, Argentina's Congress
passed a bill that will allow the government to repay holders of
debt that the South American country defaulted on in 2001,
including a group of litigating hedge funds that won judgments
in a New York court. The bill passed by a vote of 54-16.
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B O L I V I A
=============
BOLIVIA: Reforms Judiciary Amid Controversy
-------------------------------------------
EFE News reports that President Evo Morales signed legislation
into law on strengthening Bolivia's judicial system at a time when
the courts are in the spotlight for their handling of several
cases, including that of a man convicted of rape despite the
existence of evidence proving his innocence.
President Morales signed the legislation during a ceremony at the
government palace in La Paz as judicial and political officials
watched, according to EFE News.
The report notes that the president said the law's goal was to
"improve Bolivian justice" by creating a new class of
constitutional courts at the provincial level.
"Sometimes the hard work of men and women committed to Bolivian
justice, for whatever reason, gets destroyed," the report quoted
Mr. Morales as saying.
The law's enactment comes after a court upheld the 20-year prison
sentence handed down to a doctor for raping an infant, a case that
has sparked controversy after evidence, including an audio
recording of a purported judge saying the physician was wrongly
convicted, pointing to the man's innocence appeared, the report
relays.
"You can have good rules, good infrastructure, but if public
servants don't do their part . . . I feel that the hard work will
be in vain," the president said, the report notes.
The report relates that President Morales said some people who
questioned measures like the reform of the Criminal Code were now
regretting it.
The president talked about the possibility of trying once again to
change the code, an effort abandoned earlier this year in the wake
of protests, including a six-week strike by doctors, the report
says.
The government is trying to revive the initiative after a recent
well-publicized episode involving a doctor accused of mistakenly
removing a boy's kidneys, the report relays.
The child had one healthy kidney and a tumor on the other, and the
physician had a history of malpractice but was never convicted,
the report adds.
As reported in the Troubled Company Reporter-Latin America on
July 5, 2018, Fitch Ratings has affirmed Bolivia's Long-Term
Foreign Currency Issuer Default Rating (IDR) at 'BB-' with a
Stable Outlook.
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B R A Z I L
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EMBRAER SA: Fined for Bribery in Dominican Republic
---------------------------------------------------
EFE News reports that a court in the Dominican Republic ordered
Brazilian aerospace company Embraer to pay a fine of $7.04
million, double what the company admitted to paying in bribes when
it sold eight Super Tucano planes in 2009 to the Caribbean
country, the Dominican Office of the Attorney General said.
The Office called the ruling a milestone in the fight against
corruption, according to EFE News.
The report notes that the prosecutor's office said that the
decision was issued by the court which also ordered the Brazilian
company to provide all details on the payment of the bribes.
Embraer would have to deliver more than 4,000 pieces of
documentary evidence that are in the process of being verified.
They contain information on the bribes the company admitted to
paying to achieve the sale of the aircraft, the report relays.
This information, the Office added, will strengthen the ongoing
criminal proceedings in the courts of the persons and companies
included in the indictment filed on Sep. 6, 2017 by the Special
Prosecution of Administrative Corruption, the report notes.
Former Dominican Minister of Defense Rafael Pena Antonio is part
of the group of defendants who received $3.5 million that Embraer
paid to ensure the sale of the eight Super Tucano aircraft, the
report adds.
About Embraer SA
Headquartered in Brazil, Empresa Brasileira de Aeronautica SA
(Embraer) -- http://www.embraer.com-- is a company engaged in the
manufacture of aircrafts for commercial aviation, executive jet
and defense and government purposes. The Company has developed a
line of executive jets based on one of its regional jet platforms
and launched executive jets in the entry-level, light, ultra-large
and mid-light/mid-size categories, the Phenom 100/300 family, the
Lineage 1000 and the Legacy 450/500 family, respectively. The
Company supplies defense aircraft for the Brazilian Air Force
based on number of aircraft sold, and sells aircraft to military
forces in Europe, Asia and Latin America. In July 2008, the
Company acquired a 40% interest owned by Liebherr Aerospace SAS in
ELEB Equipamentos Ltda (ELEB). ELEB is an aerospace system and
component manufacturer, and its products include landing gear
systems, hydraulics and electro-mechanical sub-assemblies, such as
actuators, valves, accumulators and pylons.
* * *
As reported in the Troubled Company Reporter-Latin America on Aug.
2, 2018, The Latin American Herald said that Brazilian aircraft
maker Empresa Brasileira de Aeronautica SA (Embraer) reported a
net loss in the second quarter as sales declined, financial
expenses rose and the Brazilian currency weakened. The company
posted a loss of $126.5 million in the quarter, after earning a
$61.7 million gain a year before, the company said, according to
The Latin American Herald. Embraer had revenue of $1.26 billion
in the period, a decline from the same period a year earlier, the
report noted.
TCRLA reported in Apr 30, 2018, that a class action against
Embraer was recently dismissed by U.S. District Judge Richard
Berman. The class action, which was brought in federal district
court in New York, alleged that the firm had failed to adequately
disclose the scope and possible financial impact of ongoing
corruption investigations by the DOJ and SEC, harming the
company's investors.
In September 2016, the TCRLA reported that Embraer confirmed that
it would cut nearly 8 percent of its workforce through a voluntary
buyout program, slashing costs amid weak business jet sales and
downsized defense contracts.
The TCRLA further reported that Egan-Jones Ratings Company, on
Sept. 23, 2016, lowered the senior unsecured ratings on debt
issued by Embraer SA to BB+ from BBB-.
TRIZ VENTURES: Sale of Audi Approved by Court
---------------------------------------------
Judge Austin E. Carter of the U.S. Bankruptcy Court for the Middle
District of Georgia authorized TRIZ Ventures, LLC's sale of 2017
Audi A8 and 2017 Audi Q7.
A hearing on the Motion was held on Sept. 12, 2018.
The Debtor's Motion to Sell is granted with the proviso that VW
Credit, Inc., doing business as Audi Financial Services, will be
paid the full amount of its claims as determined under applicable
non-bankruptcy law at the time of the sale of its collateral.
If the claims are not paid in full within 60 days of the date of
the Order, then relief from stay is granted as to the 2017 Audi A8
and 2017 Audi Q7 without further notice or hearing to allow VW
Credit to proceed as the lienholder on the Certificate of Title to
the vehicles, to exercise its right to self-help repossess the
vehicles for foreclosure upon its interest, and to assert any or
all of its prospective legal rights, as to its collateral,
including recovery of reasonable attorney's fees to the extent the
vehicle's market value exceeds the net outstanding balance due
Movant.
The Debtor will cooperate in placing VW Credit in possession of
said units. In the event of the subsequent foreclosure/sale of
the subject property, the Creditor will be authorized to file an
unsecured claim for any deficiency balance remaining, subject to
objection by the Debtor.
About Triz Ventures LLC
TRIZ Ventures, LLC, is a multinational company --
https://trizventures.com/ -- engaged in producing, procuring,
processing and international trading of peanuts, tree nuts, edible
oils and other foodstuffs, satisfying the most demanding global
markets. Triz Ventures has diversified its business to major
countries like USA, Brazil, Mexico, The Netherlands, India,
Singapore, South Africa, Benin, Vietnam and China.
TRIZ Ventures, LLC, based in Albany, GA, filed a Chapter 11
petition (Bankr. M.D. Ga. Case No. 18-10489) on April 24, 2018.
The Hon. Austin E. Carter presides over the case. Kenneth W.
Revell, Esq., at Zalkin Revell, PLLC, serves as bankruptcy
counsel. In the petition signed by Dhawal Raste, manager, the
Debtor estimated $100,000 to $500,000 in assets and $1 million to
$10 million in liabilities.
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C H I L E
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GEOPARK LTD: S&P Affirms 'B+' Issuer Credit Rating, Outlook Stable
------------------------------------------------------------------
S&P Global Ratings affirmed its 'B+' long-term issuer credit
rating on GeoPark Ltd. (GPRK). At the same time, S&P affirmed its
'B+' issue-level rating on the company's $425 million senior
secured notes due 2024. The outlook is stable.
S&P said, "The affirmation reflects our expectation that GPRK will
continue to post strong credit metrics over the next two years,
while it grows its production and reserves and maintains robust
margins. This should all be backed by a favorable price scenario,
disciplined capital expenditures (capex), significant internal
cash flow generation, and a meaningful reserve base at its best-
performing production sites. Our assessment also incorporates a
manageable debt maturity schedule after the debt refinancing in
the second half of 2017."
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C O L O M B I A
===============
CREDIVALORES CREDISERVICIOS: S&P Affirms B+ LT ICR, Outlook Neg.
----------------------------------------------------------------
S&P Global Ratings revised its outlook on Credivalores -
Crediservicios SAS (Credivalores) to negative from stable. S&P
said, "We also affirmed our 'B+' long-term and 'B' short-term
issuer credit ratings on the firm. At the same time, we affirmed
our 'B+' issue-level rating on the firm's senior unsecured notes."
The negative outlook reflects the deterioration in Credivalores'
risk-adjusted capital (RAC) ratio due to the impact of IFRS 9
adoption that decreased total adjusted capital (TAC), coupled with
the recognition of a minority equity exposure that increased the
firm's risk-weighted assets (RWAs) sharply. S&P said, "In our
opinion, the lower RAC ratio could hamper Credivalores' ability to
absorb unexpected losses. We could downgrade the lender if it
fails to implement corrective measures to strengthen the capital
base in the following months, leading to a RAC ratio of less than
7%. Additionally, the outlook revision reflects that the lender
will maintain NPAs and net charge-offs just below 12% of the total
portfolio."
The issuer credit ratings on Credivalores reflect a diversified
business mix and good market position in the Colombian financial
system. S&P said, "We also incorporate its lending and
underwriting standards, which are moderately conservative in our
opinion, compared with those of other NBFIs we rate in the region.
In addition, the ratings reflect our view of the lender's
concentrated funding structure, which consists of a single global
issuance, and sufficient liquidity levels to support growth. The
stand-alone credit profile (SACP) remains at 'b+'. which
incorporate our positive view of Credivalores' credit profile
compared with those of other NBFIs we rate in the region. We
believe Credivalores has particular fundamentals that will allow
it to navigate through Colombia's still lackluster economy, such
as a high portion of payroll discount loans that account for 53.4%
of its total credit loans. And we don't expect the rising
unemployment rate to weaken the lender's portfolio, because 85.8%
of its payroll clients are public-sector employees or retirees and
about 47% of the total loan portfolio consists of loans to these
borrowers."
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C O S T A R I C A
===================
COSTA RICA: Thousands March in Capital Amid Ongoing Strike
----------------------------------------------------------
EFE News reports that thousands of people marched Sept. 26 in
downtown San Jose on the 17th day of a strike against the Costa
Rican government's plan to broaden consumption taxes and limit the
pay of public employees.
The leader of the National Association of Public Employees, Albino
Vargas, said "a million people" -- a fifth of the population of
Costa Rica -- had participated in the march, sending a clear
message to demand the government to cancel the tax reform and
draft a new bill in consultation with the unions, according to EFE
News.
"A tombstone was placed on the tax bill. It was already buried,
but we placed its tombstone. It is necessary to create a national
political, social and multisectoral dialogue to seek a solution
for Costa Rica in the short, medium and long term," Mr. Vargas
told reporters, the report relays.
Mr. Vargas said that the march was a "second street referendum"
against the tax reform, after a first massive demonstration took
place on Sept. 12.
Unions are demanding congress to withdraw the tax reform bill and
to draft a new bill based on a proposal that includes 39 measures,
though the government insists on sticking with its existing plan,
the report notes.
President Carlos Alvarado went on live television to urge
lawmakers to approve to bill in October, saying "time is over,"
the report relays
The government's tax bill seeks to reduce the budget deficit
estimated at 7.1 percent of GDP and to slow the rise in debt,
which will surpass half of the GDP this year, the report adds.
As reported in the Troubled Company Reporter-Latin America on
Feb. 26, 2018, S&P Global Ratings affirmed its 'BB-' long-term
foreign and local currency sovereign credit ratings on the
Republic of Costa Rica. The outlook remains negative. At the same
time, S&P affirmed its 'B' short-term foreign and local currency
sovereign credit ratings and its 'BB+' transfer and convertibility
assessment.
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E C U A D O R
=============
ECUADOR: To Get $100MM-IDB Loan for Electric System Improvement
---------------------------------------------------------------
The Inter-American Development Bank (IDB) has approved a $100
million loan to help Ecuador revamp, repower and improve the
reliability of its electric system.
The loan will provide continuity to the IDB's support to Ecuador's
power sector, contributing to the government's efforts to promote
investments to strengthen the National Interconnected System. This
operation focuses on equipment renewal, replacement and repowering
in both the national transmission and distribution systems. It
will also help strengthen management and planning capabilities.
Ecuador's power sector is a leader in the region due to its
maturity, reliability and high service coverage and quality
indices. These results were achieved thanks to careful sectoral
planning coupled with a constant investments flow that has
contributed to enhance and strengthen power infrastructure and to
advance towards a robust, efficient and reliable National
Interconnected System. The Bank has helped finance Ecuador's
investment programs over the past decade, which has seen progress
in areas such as transmission, distribution, rural electrification
and energy efficiency.
With the new loan, the Government of Ecuador will implement
projects that will ensure service continuity, including
technological measures aimed at enhancing the system's
digitalization and promoting its integrated management. In
addition, these investments will improve the system's operational
capabilities by replacing equipment that has reached the end of
its life cycle or met its design capacity limit.
The funds will also support projects to boost environmental waste
management capabilities and institutional strengthening to improve
energy prospecting and analysis. Plus, they will finance the first
stage of the Gender Action Plan for the electricity sector,
including actions to reinforce gender equality in the areas of
policy formulation and project planning, generation and
management.
The $100 million IDB loan is for a 25-year term, with a 5-year
disbursement period, a 7.5-year grace period and a LIBOR-based
interest rate.
As reported in the Troubled Company Reporter-Latin America on
Aug. 22, 2018, Fitch Ratings has downgraded Ecuador's Long-Term
Foreign-Currency Issuer Default Rating (IDR) to 'B-' from 'B'. The
Outlook has been revised to Stable from Negative. Additionally,
Fitch has assigned the sovereign a 'B-' Long-Term Local-Currency
IDR/Stable Outlook and a 'B' Short-Term Local-Currency IDR.
======================
P U E R T O R I C O
======================
TOYS "R" US: Seeks to Hire CBRE Inc. as Real Estate Broker
----------------------------------------------------------
Toys "R" Us Property Company I, LLC, and its debtor-affiliates
seek authority from the U.S. Bankruptcy Court for the Eastern
District of Virginia to employ CBRE, Inc., as real estate broker
to the Debtors.
Toys "R" Us requires CBRE Inc. to market and sell the corporate
headquarters of Toys "R" Us business, located in Wayne, New
Jersey.
CBRE Inc. will be paid a commission of 2.8% of the purchase price.
In the event that a sale is not consummated, CBRE Inc. will be
reimbursed for marketing, and reasonable out-of-pocket expenses
incurred up to $5,000.
Jeffrey C. Babikian, executive vice president of CBRE Inc.,
assured the Court that the firm is a "disinterested person" as the
term is defined in Section 101(14) of the Bankruptcy Code and does
not represent any interest adverse to the Debtors and their
estates.
CBRE Inc. can be reached at:
Jeffrey C. Babikian
CBRE INC.
200 Park Avenue, 19th Floor
New York, NY 10166
Tel: (212) 984-8000
About Toys "R" Us
Toys "R" Us, Inc., was an American toy and juvenile-products
retailer founded in 1948 and headquartered in Wayne, New Jersey,
in the New York City metropolitan area. Merchandise was sold in
880 Toys "R" Us and Babies "R" Us stores in the United States,
Puerto Rico and Guam, and in more than 780 international stores
and more than 245 licensed stores in 37 countries and
jurisdictions. Merchandise was also sold at e-commerce sites
including Toysrus.com and Babiesrus.com.
On July 21, 2005, a consortium of Bain Capital Partners LLC,
Kohlberg Kravis Roberts, and Vornado Realty Trust invested $1.3
billion to complete a $6.6 billion leveraged buyout of the
company.
Toys "R" Us is a privately owned entity but still files with the
U.S. Securities and Exchange Commission as required by its debt
agreements.
The Company's consolidated balance sheet showed $6.572 billion in
assets, $7.891 billion in liabilities, and a stockholders' deficit
of $1.319 billion as of April 29, 2017.
Toys "R" Us, Inc., and certain of its U.S. subsidiaries and its
Canadian subsidiary voluntarily filed for relief under Chapter 11
of the Bankruptcy Code (Bankr. E.D. Va. Lead Case No. Case No.
17-34665) on Sept. 19, 2017. In addition, the Company's Canadian
subsidiary voluntarily commenced parallel proceedings under the
Companies' Creditors Arrangement Act ("CCAA") in Canada in the
Ontario Superior Court of Justice. The Company's operations
outside of the U.S. and Canada, including its 255 licensed stores
and joint venture partnership in Asia, which are separate
entities, were not part of the Chapter 11 filing and CCAA
proceedings.
Grant Thornton is the monitor appointed in the CCAA case.
Judge Keith L. Phillips presides over the Chapter 11 cases.
In the Chapter 11 cases, Kirkland & Ellis LLP and Kirkland & Ellis
International LLP serve as the Debtors' legal counsel. Kutak Rock
LLP serves as co-counsel. Toys "R" Us employed Alvarez & Marsal
North America, LLC as its restructuring advisor; and Lazard Freres
& Co. LLC as its investment banker. It hired Prime Clerk LLC as
claims and noticing agent. Consensus Advisory Services LLC and
Consensus Securities LLC, serve as sale process investment banker.
A&G Realty Partners, LLC, serves as its real estate advisor.
On Sept. 26, 2017, the U.S. Trustee for Region 4 appointed an
official committee of unsecured creditors. The Committee retained
Kramer Levin Naftalis & Frankel LLP as its legal counsel; Wolcott
Rivers, P.C., as local counsel; FTI Consulting, Inc. as financial
advisor; and Moelis & Company LLC as investment banker.
Toys "R" Us UK
Toys "R" Us Limited, Toys "R" Us, Inc.'s UK arm with 105 stores
and 3,000 employees, was sent into administration in the United
Kingdom in February 2018.
Arron Kendall and Simon Thomas of Moorfields Advisory Limited, 88
Wood Street, London, EC2V 7QF were appointed Joint Administrators
on Feb. 28, 2018. The Administrators now manage the affairs,
business and property of the Company. The Administrators act as
agents only and without personal liability.
The Administrators said they will make every effort to secure a
buyer for all or part of the business.
Liquidation of U.S. Stores
Toys "R" Us, Inc., on March 15, 2018, filed with the U.S.
Bankruptcy Court a motion seeking Bankruptcy Court approval to
start the process of conducting an orderly wind-down of its U.S.
business and liquidation of inventory in all 735 of the Company's
U.S. stores, including stores in Puerto Rico.
Propco I Debtors
Toys "R" Us Property Company I, LLC and its subsidiaries own fee
and leasehold interests in more than 300 properties in the United
States. The Debtors lease the properties on a triple-net basis
under a master lease to Toys-Delaware, the operating entity for
all of TRU's North American businesses, which operates the
majority of the properties as Toys "R" Us stores, Babies "R" Us
stores or side-by-side stores, or subleases them to alternative
retailers.
Toys "R" Us Property was founded in 2005 and is headquartered in
Wayne, New Jersey. Toys 'R' Us Property operates as a subsidiary
of Toys "R" Us Inc.
Company LLC, MAP Real Estate LLC, TRU 2005 RE I LLC, TRU 2005 RE
II Trust, and Wayne Real Estate Company LLC -- Propco I Debtors --
sought protection under Chapter 11 of the Bankruptcy Code (Bankr.
E.D. Va. Lead Case No. 18-31429) on March 20, 2018. The Propco I
Debtors sought and obtained procedural consolidation and joint
administration of their Chapter 11 cases, separate from the Toys
"R" Us Debtors' Chapter 11 cases.
The Propco I Debtors estimated assets of $500 million to $1
billion and liabilities of $500 million to $1 billion.
Judge Keith L. Phillips presides over the Propco I Debtors' cases.
The Propco I Debtors hired Klehr Harrison Harvey Branzburg, LLP;
and Crowley, Liberatore, Ryan & Brogan, P.C., as co-counsel. The
Debtors also tapped Kutak Rock LLP. They hired Goldin Associates,
LLC, as financial advisors.
=================
X X X X X X X X X
=================
LATAM: IDB Says Gov. Spending Waste Costs 4.4% of GDP in Region
----------------------------------------------------------------
A landmark analysis of government spending in Latin America and
the Caribbean reveals widespread waste and inefficiencies that
could be as large as $220 billion a year, or 4.4 percent of the
region's GDP, showing there is ample room to improve basic
services without necessarily spending more resources.
Better Spending for Better Lives: How Latin America and the
Caribbean Can Do More with Less, a report by the Inter-American
Development Bank, was launched as governments across the region
struggle to meet their citizens' rising expectations with limited
budgets.
The publication, part of the IDB's flagship studies series,
Development in the Americas, argues against across-the-board cuts.
It looks at whether countries spend too much or too little on
different priorities, whether they invest enough to ensure a
better future, and whether those expenditures make inequality
better or worse.
Along with the diagnosis, the report offers several policy
recommendations on how to improve the efficiency of government
spending, such as reducing the cost of delays and budget overruns
in infrastructure projects, as well as corruption in procurement.
"At a time when governments have to make tough choices, this
report provides a timely platform for discussing how efficiently
we spend our public resources to ensure the best possible
outcomes, not just for the present but for the future," said IDB
chief economist Alejandro Izquierdo, who edited the book. "The
good news is we can improve the lives of our citizens by spending
better, rather than by spending more."
Spending that Underperforms
Consolidated public spending averages 29.7 percent of GDP in Latin
America and the Caribbean, almost 6 percentage points more than in
the early 2000s. Spending ranges from 35 percent of GDP and above
in Argentina and Brazil to below 20 percent of GDP in the
Dominican Republic and Guatemala.
Following the 2007-2008 global financial crisis, many Latin
American countries rode a commodity windfall and raised their
spending on items such as public sector salaries and pensions,
which are difficult to dial back. Governments now need to make the
most of their tax revenues.
Some of The Key Findings in The Report Are:
Moderate estimates of inefficiencies in procurement (including
losses caused by corruption and delays), excessive civil service
payroll and transfers that do not reach the targeted population,
could amount to as much as 4.4 percent of GDP, or $220 billion
(about 16 percent of total spending) -- enough to eliminate
extreme poverty in the region. Chile and Peru are the most
efficient in their spending, with wastage of 1.8 percent and 2.5
percent of GDP, respectively.
Public investment needed to ensure future growth has lost more
than 8 percentage points in the budget relative to current
expenditure. While public investment per capita has increased on
average more than 50 percent in every other region in the world,
in Latin America it has only crept up 5 percent, remaining roughly
at the same levels as in the 1980s.
Latin America and the Caribbean spends four times more on the
elderly than its younger cohorts. If current pension and health
expenditure regimes are kept in place, their share in the budget
could jump from 35% to as much as 78% by 2065, putting fiscal
sustainability at risk and starving other priorities such as
developing the job skills and the infrastructure necessary to
sustain future economic growth.
More government spending is unlikely to help close the region's
inequality gap if inefficiencies in redistribution are not
corrected. For 16 Latin American countries, direct taxes and cash
transfers reduce inequality by only 4.7 percent on average, while
in a sample of advanced countries the decline is 38 percent.
Reducing cost overruns and delays in government-financed
infrastructure projects to the levels of projects financed by
multilateral development banks could produce cost savings of
almost 1.2 percent of GDP. This could free up $50 billion a year
for infrastructure investments.
Several countries could improve health indicators without
increasing budgets by aligning their spending to international
efficiency standards. For the region, life expectancy could be
extended by four years, with Bolivia, Guyana, Suriname and
Trinidad and Tobago gaining more than seven years. Similarly,
crime could be reduced 30 percent.
Recommendations to Policymakers
The book contains a wide range of specific recommendations for
policymakers, including using more cost-benefit analysis when
determining budget choices for better expenditure allocation, as
well as the creation of specific agencies for strategic planning
that use rigorous evaluations of the impact of government programs
before making allocation decisions.
The report also advocates for fiscal rules that go beyond fiscal
sustainability to investment protection, such as Peru's double
condition fiscal rule, which sets specific limits to growth in
current expenditures, making sure that it will not eat up
resources that should be allocated to capital expenditures.
The report lists multiple ways to improve the management of civil
service expenditures, from developing comprehensive civil service
plans that set clear visions and goals, to headcount and
transactional audits.
In education, the book recommends, among other measures,
accompanying higher spending per student with more accountability
measures to reduce corruption, as well as better training and
performance pay for teachers.
Regarding public safety, the book notes that the region suffers
from high crime levels even though it significantly increased
spending on policing and incarceration, with the security sector
absorbing 5.4 percent of fiscal budgets -- versus 3.3 percent for
OECD countries. The report lists improvement areas in police
organization and efficiency, better management of crime prevention
programs, and targeting high-risk places, people and behaviors,
among others.
Low Trust in Government
Finally, Spending Better for Better Lives also looks at intangible
elements that underpin budget decisions, such as the level of
citizen trust in governments. A lack of trust implies, among other
things, that voters will prefer public policies that provide
immediate benefits (such as transfers) over investing in education
and infrastructure, whose benefits will not be perceived until
many years later.
"Pushing for government efficiency is not just about dry,
technical considerations," said fiscal and municipal lead
specialist Carola Pessino, who also co-edited the book. "Providing
citizens with more information so they can monitor their
governments, increasing technical and allocative efficiency so
they may get the services they deserve, are actions that will help
restore people's trust in government. They will then demand from
their politicians more long-term investments rather than
transfers, setting in motion a virtuous circle that produces
better policies and better spending."
* BOND PRICING: For the Week September 24 to September 28, 2018
----------------------------------------------------------------
Issuer Name Cpn Price Maturity Country Curr
----------- --- ----- -------- ------- ---
Banco do Brasil SA/Cayman 6.25 75.043 KY USD
Rio Energy SA 6.875 71.638 2/1/2025 AR USD
Cia Latinoamericana 9.5 60.447 7/20/2023 AR USD
CSN Islands XII Corp 7 69.44 BR USD
Agua y Saneamientos 6.625 71.982 2/1/2023 AR USD
Odebrecht Finance Ltd 7.5 39.15 KY USD
YPF SA 16.5 50.96 5/9/2022 AR ARS
Odebrecht Finance Ltd 4.37 35.715 4/25/2025 KY USD
Banco Macro SA 17.5 50 5/8/2022 AR ARS
Odebrecht Finance Ltd 7.12 37.293 6/26/2042 KY USD
China Huiyuan 6.5 75.1 8/16/2020 CN USD
Odebrecht Finance 5.125 45.754 6/26/2022 KY USD
Noble Holding 6.2 74.46 8/1/2040 KY USD
Noble Holding 5.25 70.444 3/15/2042 KY USD
Odebrecht Finance 7 58.985 4/21/2020 KY USD
Noble Holding 6.05 73.508 3/1/2041 KY USD
Odebrecht Finance 5.25 36.2 6/27/2029 KY USD
Rio Energy SA 6.875 71.551 2/1/2025 AR USD
BCP Finance Co 1.751 74.397 KY EUR
Provincia del Chubut 4 10/21/2019 AR USD
YPF SA 16.5 50.96 5/9/2022 AR ARS
Argentina 7.125 76 6/28/2117 AR USD
Automotores Gildemeister 6.75 62.759 1/15/2023 CL USD
Odebrecht Finance 6 37.193 4/5/2023 KY USD
Banco do Brasil 6.25 76.375 KY USD
Cia Latinoamericana 9.5 60.621 7/20/2023 AR USD
Polarcus Ltd 5.6 70 7/1/2022 AE USD
Argentina 6.875 74.985 1/11/2048 AR USD
Provincia del Chubut 7.75 72.304 7/26/2026 AR USD
Banco Macro SA 17.5 50 5/8/2022 AR ARS
CSN Islands XII Corp 7 74.375 BR USD
Provincia de Rio Negro 7.75 70.153 12/7/2025 AR USD
Provincia de Entre Rios 8.75 71.083 2/8/2025 AR USD
Argentina 4.33 70 12/31/2033 AR JPY
Provincia de Entre Rios 8.75 72.333 2/8/2025 AR USD
Odebrecht Finance Ltd 4.375 35.242 4/25/2025 KY USD
Ironshore Pharma 13 69.621 2/28/2024 KY USD
Automotores Gildemeister 8.25 60.583 5/24/2021 CL USD
Odebrecht Finance Ltd 7.125 38.674 6/26/2042 KY USD
Odebrecht Finance Ltd 5.25 36.187 6/27/2029 KY USD
Province of Santa Fe 6.9 74.177 11/1/2027 AR USD
Provincia del Chubut 7.75 71.654 7/26/2026 AR USD
Argentina 6.25 72.711 11/9/2047 AR EUR
Cia Energetica 6.1827 1.105 1/15/2022 BR BRL
Odebrecht Finance 7.5 43.5 KY USD
Argentina 0.45 31.75 12/31/2038 AR JPY
SACI Falabella 2 7/15/2020 CL CLP
Province of Jujuy 8.625 72.788 9/20/2022 AR USD
Province of Santa Fe 6.9 73.44 11/1/2027 AR USD
Ironshore Pharma 13 69.621 2/28/2024 KY USD
Tanner Servicios 3.8 52.42 4/1/2021 CL CLP
AES Tiete Energia SA 6.78 1.06 4/15/2024 BR BRL
Odebrecht Finance Ltd 6 37.19 4/5/2023 KY USD
Provincia de Rio Negro 7.75 70.15 12/7/2025 AR USD
Odebrecht Finance 7 59.466 4/21/2020 KY USD
Odebrecht Finance Ltd 5.12 47.298 6/26/2022 KY USD
Provincia de Cordoba 7.12 74.286 8/1/2027 AR USD
Argentina 7.125 75.752 6/28/2117 AR USD
Automotores Gildemeister 8.25 60.583 5/24/2021 CL USD
Enlasa Generacion 3.558 11/15/2023 CL CLP
Metrogas SA/Chile 645 8/1/2024 CL CLP
Automotores Gildemeister 6.75 62.759 1/15/2023 CL USD
Provincia del Chaco 9.375 72.315 8/18/2024 AR USD
Fospar S/A 6.53 1.034 5/15/2026 BR BRL
Sociedad Concesionaria 2.9547 6/30/2021 CL CLP
Esval SA 3.453 3/15/2028 CL CLP
Caja de Compensacion 7.75 35.23 3/27/2024 CL CLP
Sociedad Austral 318.478 9/20/2019 CL CLP
Provincia de Neuquen 7.5 74.753 4/27/2025 AR USD
Caja de Compensacion 5.2 9/15/2018 CL CLP
Empresa de Transporte 4.341 7/15/2020 CL CLP
Corp Universidad 5.968 11/10/2021 CL CLP
Provincia de Cordoba 7.125 74.802 8/1/2027 AR USD
Provincia del Chaco 9.375 72.585 8/18/2024 AR USD
Argentine Republic 7.125 75.322 6/28/2117 AR USD
Sylph Ltd 2.367 61.194 9/25/2036 KY USD
Banco Security SA 311 7/1/2019 CL CLP
Sylph Ltd 2.657 73.081 3/25/2036 KY USD
***********
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.
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, Julie Anne L. Toledo, Ivy B. Magdadaro, and Peter A.
Chapman, Editors.
Copyright 2018. 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.
.
* * * End of Transmission * * *