/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/240628.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, June 28, 2024, Vol. 25, No. 130 Headlines A N T I G U A A N D B A R B U D A ANTIGUA & BARBUDA: Economy Continues to Recover, IMF Says B E R M U D A NABORS INDUSTRIES: Secures $475 Million Credit Facility UST HOLDINGS: Moody's Upgrades CFR to Ba3, Outlook Stable B R A Z I L BRAZIL: Double-Digit Rates to Bite Companies as Easing Stalls BRAZIL: Investor Confidence Wanes in Economy, BofA Survey Says D O M I N I C A N R E P U B L I C DOMINICAN REPUBLIC: S&P Assigns 'BB' Rating on US$3BB Bonds J A M A I C A EDUFOCAL: Incurs $79 Million Loss in 2023 JETAIR CARIBBEAN: Halts Operations Amid Bankruptcy JMMB GROUP: Suffers $12.6 Billion Impairment P U E R T O R I C O ESJ TOWERS: Gets Court Nod to Sell Assets to Fortaleza for $18MM V E N E Z U E L A CITGO: Finc'l Alliances Build as Share Auction Enters Last Mile - - - - - ===================================== A N T I G U A A N D B A R B U D A ===================================== ANTIGUA & BARBUDA: Economy Continues to Recover, IMF Says --------------------------------------------------------- An International Monetary Fund (IMF) team, led by Mr. David Moore, visited Antigua and Barbuda during June 17 to 21, 2024, and met with government officials and other stakeholders to discuss recent economic developments, the economic outlook, and policy priorities. At the conclusion of the visit, Mr. Moore issued the following statement: "Antigua and Barbuda's economy continues to recover. Real GDP growth is estimated at 4.2 percent in 2023, returning the country to pre-pandemic real output levels on the back of strong construction activity and continued growth in tourist arrivals. In 2024, growth is projected to be temporarily higher. Growth in 2024 is expected to accelerate to 5.8 percent, boosted by Antigua's hosting of the UN's Small Island Developing States Conference and co-hosting of the T20 Cricket World Cup. Inflation rose to 6.0 percent in April 2024, from 3.3 percent at end-2023." "The high public debt burden poses ongoing challenges. The public debt to GDP ratio has declined from its pandemic high, from around 100 percent in 2020 to an estimated 76 percent in 2023, reflecting the economic recovery and an upward revision to nominal GDP from a rebasing of the national accounts statistics. However, cash constraints continue to bind, and domestic and external arrears are substantial. Fiscal adjustment is needed to create space to clear arrears and prevent their reemergence. The timely completion of the authorities' validation of domestic arrears, development of a comprehensive arrears clearance strategy, and close engagement with creditors and domestic suppliers, will be essential for restoring debt sustainability." "The 2024 budget represents important progress towards stronger fiscal buffers. Given Antigua and Barbuda's high debt and financing needs, and susceptibility to external shocks, measures to improve the fiscal position are critical to help reduce vulnerabilities. The 2024 budget includes a package of revenue measures—in particular, increasing the standard ABST rate and broadening its base, introducing excise taxes on alcohol, tobacco, and cannabis products, and raising property taxes for high-end properties—that is expected to improve the fiscal position by around ½ percent of GDP in 2024. Room remains to strengthen the fiscal position further, including through closer adherence to the cap on discretionary tax exemptions, and continuing the recent efforts to enhance expenditure commitment controls." "Credit market developments reflect the broader pickup in activity. Bank credit to the private sector rebounded by 7 percent in 2023, after contracting in the previous two years. Credit unions have expanded rapidly over several years, with loan growth moderating to around 8 percent in the year through 2024Q1. Non-performing loans for both banks and credit unions, as a share of total loans, are modestly above the prudential level of 5 percent. Stronger oversight and regulation of credit unions, including through risk-based capital requirements, would promote a level playing field across the financial sector and support asset quality." "Further work is needed to address persistent data gaps. The statistical authorities have made efforts to update the national accounts and improve data quality. Ensuring sufficient resources for completing the Population and Housing Census, the Producer Price Index and the 2023 Labour Force Survey, and reporting on the financial operations of state-owned enterprises, would facilitate evidence-based policy making and transparency." "The IMF team thanks the authorities and other counterparts for their collaboration and support, as well as for the valuable discussions." ============= B E R M U D A ============= NABORS INDUSTRIES: Secures $475 Million Credit Facility ------------------------------------------------------- Nabors Industries Ltd. closed, on June 17, 2024, an amendment and restatement of its secured credit facility. The new $475 million facility is comprised of $350 million for revolving credit and $125 million for letters of credit. The facility matures on June 17, 2029. The maturity date can be brought forward to 90 days before the maturity date of certain of the Company's debt securities, if those debt securities were not sufficiently paid down prior to such date. The amended and restated facility replaces the Company's prior $350 million secured credit facility, which would have matured on January 21, 2026 Changes in the amended and restated credit facility from the prior facility include: * a $125-million letter of credit facility, increased from $100 million in the prior credit facility, with issued letters of credit not affecting Nabors' capacity under the $350 million revolving facility; and * A $200-million uncommitted accordion feature that can be applied to increase the commitments for Revolving Credit or Letters of Credit Facility, or both. This compares to a $100 million accordion for the prior facility. The existing basket in the prior facility of up to $150 million for additional indebtedness in the form of term loans and letter of credits, secured by liens, remains unchanged. In addition, the grower basket for term loans of up to $100 million also remains unchanged. Consistent with the prior credit facility, the amended and restated credit facility requires Nabors to maintain an interest coverage ratio of 2.75:1.00 and a minimum guarantor value of 90%. The amended and restated credit facility is guaranteed by Nabors and certain of its subsidiaries. Initial borrowing margin under the new credit facility will be approximately 2.75%. The borrowing rate will vary over time and may be adjusted with changes to Nabors' credit ratings. William Restrepo, Nabors' Chief Financial Officer, commented, "Following our recent notes issue in late 2023, we are improving our near-term liquidity by closing on this amended credit facility. The amended facility matures five years from now. The expansion of our credit facility will provide us with more flexibility to address our working capital needs and will support growth in our international markets, where contracts often require bid or performance bonds, without consuming capacity of the revolving credit facility. "This amendment to our credit facility improves our overall liquidity profile. As we have done before, we plan to continue addressing our debt maturities prudently and well in advance of their expiration. As we progress through 2024, we expect our operating results to strengthen, supporting our cash flow targets." Institutions participating in the credit facility are Citibank, N.A., Wells Fargo Bank, N.A., Goldman Sachs Bank USA, HSBC Bank USA, N.A. and Morgan Stanley Senior Funding, Inc. Further details regarding the credit facility filed in a Current Report on Form 8-K filed with the Securities and Exchange Commission is available at https://tinyurl.com/4ks53dtz About Nabors Bermuda-based Nabors Industries Ltd. (NYSE: NBR) owns and operates land-based drilling rig fleets and provides offshore platform rigs in the United States and several international markets. Nabors also provides directional drilling services, tubular services, performance software, and innovative technologies for its own rig fleet and those of third parties. Nabors Industries reported a net loss of $11.8 million for the year ended December 31, 2023, a net loss of $307.22 million in 2022, a net loss $543.69 million in 2021, a net loss of $762.85 million in 2020, a net loss of $680.51 million in 2019, a net loss of $612.73 million in 2018, and a net loss of $540.63 million in 2017. As of March 31, 2024, the Company had $4.64 billion in total assets, $3.37 billion in total liabilities, and $522.82 million in total stockholders' equity. * * * In September 2023, Egan-Jones Ratings Company upgraded the foreign currency and local currency senior unsecured ratings on debt issued by Nabors Industries, Inc. to CCC+ from CCC-. In March 2024, S&P Global Ratings revised its outlook to stable from positive and affirmed its 'B-' issuer credit rating on Nabors Industries Ltd. At the same time, S&P affirmed its 'B-' issue-level rating on the company's senior priority guaranteed notes with recovery rating of '3' and 'CCC' issue-level rating on the company's priority guaranteed notes with recovery rating of '6'. The stable outlook reflects S&P's expectation for the company's operating performance, industry fundamentals, near-term debt maturity profile, and credit metrics to remain appropriate for the 'B-' issuer credit rating. The outlook revision reflects S&P's expectation of reduced free cash flow generation and lower than anticipated debt reduction. UST HOLDINGS: Moody's Upgrades CFR to Ba3, Outlook Stable --------------------------------------------------------- Moody's Ratings upgraded the corporate family rating of UST Holdings LTD ("UST") to Ba3 from B1 and the probability of default rating to Ba3-PD from B1-PD. Moody's also upgraded UST Global Inc.'s senior secured first-lien bank credit facilities, which include a $125 million revolving credit facility expiring November 2026 and a $400 million (at issuance) term loan maturing November 2028, to Ba3 from B1. The outlook is stable. UST is a global business-to-business information technology services and solutions provider. The rating upgrades reflect UST's growing revenue scale, as well as its improving profitability rates and strong free cash flow generation, which, combined with a track record of moderate financial policies, supports an enhanced credit profile. Revenue diversification has also increased substantially over the last 3 years, with annual revenue approaching $2 billion and roughly 30% of revenue generated by the fast-growing platform segment. Moody's expect profitability rates and cash flow generation will continue to benefit from operating leverage and lower platform investment needs. ESG governance considerations are a key driver of the rating action. The company's track record of moderate financial policies mitigates its high and private ownership concentration. RATINGS RATIONALE UST's credit profile reflects the company's scale and scope relative to larger information technology (IT) services providers. The company has improved its profitability rates over time, but EBITDA margins remain thin, at around 11% as of the last twelve month period ended March 31, 2024, compared to larger peers in the industry. Increasing scale in its platform solutions segment will continue to boost profitability over time, but growth will require further client wins in a competitive software and IT services environment. Demand for UST's services, especially within the Digital Solutions segment (around 61% of revenue as of the LTM ended March 31, 2024), is subject to cyclical swings in IT budgets. Organic revenue growth will remain soft in 2024 as client spend remains constrained by macroeconomic uncertainty, offset by inorganic contributions. All financial metrics include Moody's adjustments. Moody's long-term organic growth expectations remain healthy as UST will continue to benefit from favorable IT industry trends, such as cloud migrations, automation, artificial intelligence, data analytics and other fast-growing technologies. Customer concentration has diminished but remains high, with UST's top 5 customers representing approximately 29% of total revenue as of the LTM ended March 31, 2024. However, long-tenured relationships with a stable client base of large global clients and good diversification across end markets mitigate concentration risks. Governance considerations stemming from the company's concentrated ownership weigh on the credit profile, partially offset by Moody's expectation for balanced financial policies. UST has reduced debt/EBITDA leverage from over 4x at the end of 2021 to 2.1x as of March 31, 2024. Moody's anticipate UST will continue to sustain modest financial leverage over the long term, but could opportunistically raise new debt to fund large M&A targets. UST has very good liquidity, supported by a $240 million cash and equivalent balance as of March 31, 2024, the undrawn $125 million revolver, and Moody's expectation for free cash flow-to-debt metrics above 10% over the next 12-15 months. Moody's anticipate UST will be able to fund its internal needs with existing balances and cash from operations and Moody's do not expect the company will need to rely on revolver borrowings. Moody's expect free cash flow above $150 million in 2024, with strong FCF/debt above 10% and debt/EBITDA below 2x in the absence of leveraging transactions. The senior secured first-lien $125 million revolving credit facility has a 5x springing first-lien leverage covenant, tested only when at least 35% of the facility has been drawn. Moody's expect the company will maintain an ample cushion against the covenant test. The senior secured first-lien term loan does not have any financial covenants. The term loan facility amortizes 1% per annum with the balance due at maturity. The Ba3 rating on the senior secured first-lien term loan and the senior secured first-lien revolving credit facility is in line with the Ba3 CFR because there is no other meaningful debt in the capital structure. The financial statements are consolidated at UST Holdings LTD, a Bermuda company, which is the parent entity of the borrower, UST Global Inc., and various co-borrowers. The reporting entity, UST Holdings LTD, does not provide a guarantee to the credit facility. As a result, Moody's cannot definitively verify the assets, liabilities, and cash flows pledged to the credit group. Negative rating actions, including the withdrawal of current ratings, could occur if the financial information provided is not deemed to be representative of the credit quality of the borrower and co-borrowers. The stable outlook reflects Moody's expectation for low-to-mid single-digit percentage revenue growth in 2024, as tactical discretionary IT spend improves in the second half of 2024 and inorganic contributions offset organic softness, and mid single-digits or above in 2025. Moody's expect profitability rates will continue to improve, with EBITDA margins trending towards 13% as increasing scale offsets the lower margin profile of acquired assets and investment needs in the platform segment diminish. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings could be upgraded if the company increases its scale and product diversification, while reducing customer concentration. A ratings upgrade would also require improved profitability, with EBITDA margins approaching 20%, and Moody's expectation for balanced financial policies and very good liquidity. Lastly, improved governance including diminished ownership concentration would also be required for a ratings upgrade. The ratings could be downgraded if operational performance deteriorates or UST experiences major customer losses, evidencing increased competition or gaps in digital capabilities. Diminishing profitability, with EBITDA margins below 10%, could also result in a ratings downgrade, along with more aggressive financial policies such that Moody's expect debt/EBITDA will be sustained at 4x or higher. A material deterioration in the company's liquidity position could also result in a ratings downgrade. The principal methodology used in these ratings was Business and Consumer Services published in November 2021. UST Holdings LTD, incorporated in Bermuda, serves clients across various industry verticals including healthcare, retail, manufacturing, technology, media, telecom, and financial services. UST generates revenue from three main segments: Digital Solutions, Platforms and Product Engineering services. UST is privately held and majority owned by Tricase Investment Holdings Inc., with Temasek and various employees as minority shareholders. The company generated roughly $1.9 billion in revenue as of the last twelve months ended March 31, 2024. =========== B R A Z I L =========== BRAZIL: Double-Digit Rates to Bite Companies as Easing Stalls ------------------------------------------------------------- globalinsolvency.com, citing Bloomberg News, reports that Brazilian companies that loaded up on cheap debt are bracing for a new reality: double-digit interest rates for longer than anyone expected. The Central Bank of Brazil's easing cycle appears headed for a premature end, with traders expecting it to hold the policy rate at 10.5% when it meets later, according to globalinsolvency.com. The report notes that borrowing costs will remain above 10% for the foreseeable future, according to pricing in Brazil's swap curve. That poses a fresh challenge to companies carrying floating-rate debt they took on when rates were around historic lows of 2% during the pandemic, the report relays. Executives planned for rates to come down allowing them to refinance those loans, the report notes. Across the globe, consumers, chief financial officers, and government finance ministers are being forced to adjust to a world in which rates stay higher-for-longer, the report says. The situation in Brazil stands out as policymakers in Latin America's largest economy were among the first to raise rates and to start cutting, the report discloses. That campaign has been derailed by questions over sticky inflation and the country's ability to control its fiscal deficit, the report relays. "There is a general discomfort in relation to Brazil's fiscal situation," said Ricardo Carvalho, head of Brazilian corporates at Fitch Ratings, adding that the offshore bond market is largely off limits to all but the largest, highest-rated companies, the report adds. About Brazil Brazil is the fifth largest country in the world and third largest in the Americas. Luiz Inacio Lula da Silva won the 2022 Brazilian general election. He was sworn in on January 1, 2023, as the 39th president of Brazil, succeeding Jair Bolsonaro. S&P Global Ratings raised on Dec. 19, 2023, its long-term global scale ratings on Brazil to 'BB' from 'BB-'. The outlook on the long-term ratings is stable. S&P affirmed Brazil's global scale short-term ratings at 'B' and its national scale long-term rating at 'brAAA'. S&P also raised the transfer and convertibility assessment on the country to 'BBB-' from 'BB+'. S&P said, "The stable outlook reflects our expectation that Brazil will maintain A strong external position, thanks to strong commodity output and limited external financing needs. We also believe Brazil's institutional framework can sustain stable and pragmatic policymaking based on extensive checks and balances across the executive, legislative, and judicial branches of government. We expect a very gradual fiscal correction but anticipate fiscal deficits will remain large." Fitch Ratings affirmed on Dec. 15, 2023, Brazil's Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'BB' with a Stable Outlook. Fitch said Brazil's ratings are supported by its large and diverse economy, high per-capita income, and deep domestic markets and a large cash cushion that support the sovereign's financing flexibility and its high local-currency debt share. Strong external finances support resilience to shocks, underpinned by a flexible exchange rate, robust international reserves and a sovereign net external creditor position. The ratings are constrained by weak economic growth potential, relatively low governance scores, high and rising government debt/GDP, and budgetary rigidities. A new fiscal framework introduced this year aims to anchor a gradual consolidation process and address these fiscal weaknesses, but its effectiveness is increasingly unclear. Moody's credit rating for Brazil was last set at Ba2 in 2018 with stable outlook. Moody's affirmed the Ba2 issuer ratings and senior unsecured bond ratings in April 2022. DBRS Inc., on August 15, 2023, upgraded Brazil's Long-Term Foreign and Local Currency - Issuer Ratings to BB from BB (low). At the same time, DBRS Morningstar confirmed Brazil's Short-term Foreign and Local Currency - Issuer Ratings at R-4. The trend on all ratings is Stable (March 2018). BRAZIL: Investor Confidence Wanes in Economy, BofA Survey Says -------------------------------------------------------------- Richard Mann at Rio Times Online reports that a recent Bank of America survey reveals that Latin American investment managers are increasingly concerned about Brazil's Ibovespa index and the real. Remarkably, only 7% expect the Ibovespa to surpass 140,000 points by year-end—a stark drop from 19% in May and the lowest figure since surveying began last September, according to Rio Times Online. The forecast for the U.S. dollar has risen, now expected to reach between R$5.10 and R$5.40, the report notes. Previously, the anticipated range was R$4.80 to R$5.10, the report relays. This shift indicates growing uncertainty in Brazil's financial stability, the report discloses. The survey also highlighted a consensus on interest rates; most managers predict the Brazilian Central Bank will halt further cuts, maintaining the Selic rate in double digits, the report says. They suggest future reductions will hinge on the U.S. Federal Reserve's decisions, the report notes. Meanwhile, 27% foresee the rate ending at the current 10.50% annually, whereas 20% predict a dip below 9%, the report relays. Economic growth appears less concerning for these managers; 60% project a 1-2% GDP increase this year, and 30% see a potential 2-3% rise. These figures closely match last month's predictions, the report discloses. Investment tendencies lean towards the utilities sector, showing more confidence than in finance. However, the consumer discretionary and materials sectors seem less favorable, the report says. Managerial cash reserves have climbed to 6.2%, from 5.1% in May, now slightly over the historical average, the report notes. According to BofA, the overall levels of risk-taking and precaution are maintaining their usual standards, the report relays. This mounting pessimism is noteworthy, the report discloses. Brazil plays a crucial role in Latin America's economy, and shifts in investor confidence can signal broader economic trends, the report says. The Ibovespa's performance and the strength of the real are bellwethers for Brazil's economic health, the report notes. Thus, understanding these shifts is vital for grasping the economic landscape in Latin America, the report says. As investors watch these indicators, they gauge not just the health of a nation's economy, but predict its future stability and growth prospects, the report adds. About Brazil Brazil is the fifth largest country in the world and third largest in the Americas. Luiz Inacio Lula da Silva won the 2022 Brazilian general election. He was sworn in on January 1, 2023, as the 39th president of Brazil, succeeding Jair Bolsonaro. S&P Global Ratings raised on Dec. 19, 2023, its long-term global scale ratings on Brazil to 'BB' from 'BB-'. The outlook on the long-term ratings is stable. S&P affirmed Brazil's global scale short-term ratings at 'B' and its national scale long-term rating at 'brAAA'. S&P also raised the transfer and convertibility assessment on the country to 'BBB-' from 'BB+'. S&P said, "The stable outlook reflects our expectation that Brazil will maintain A strong external position, thanks to strong commodity output and limited external financing needs. We also believe Brazil's institutional framework can sustain stable and pragmatic policymaking based on extensive checks and balances across the executive, legislative, and judicial branches of government. We expect a very gradual fiscal correction but anticipate fiscal deficits will remain large." Fitch Ratings affirmed on Dec. 15, 2023, Brazil's Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'BB' with a Stable Outlook. Fitch said Brazil's ratings are supported by its large and diverse economy, high per-capita income, and deep domestic markets and a large cash cushion that support the sovereign's financing flexibility and its high local-currency debt share. Strong external finances support resilience to shocks, underpinned by a flexible exchange rate, robust international reserves and a sovereign net external creditor position. The ratings are constrained by weak economic growth potential, relatively low governance scores, high and rising government debt/GDP, and budgetary rigidities. A new fiscal framework introduced this year aims to anchor a gradual consolidation process and address these fiscal weaknesses, but its effectiveness is increasingly unclear. Moody's credit rating for Brazil was last set at Ba2 in 2018 with stable outlook. Moody's affirmed the Ba2 issuer ratings and senior unsecured bond ratings in April 2022. DBRS Inc., on August 15, 2023, upgraded Brazil's Long-Term Foreign and Local Currency - Issuer Ratings to BB from BB (low). At the same time, DBRS Morningstar confirmed Brazil's Short-term Foreign and Local Currency - Issuer Ratings at R-4. The trend on all ratings is Stable (March 2018). =================================== D O M I N I C A N R E P U B L I C =================================== DOMINICAN REPUBLIC: S&P Assigns 'BB' Rating on US$3BB Bonds ----------------------------------------------------------- S&P Global Ratings assigned its 'BB' issue ratings to the Dominican Republic's bonds totaling an equivalent of around US$3 billion: -- The equivalent of around US$1.77 million on an external bond in local currency (Dominican pesos) due in 2036 at a 10.75% interest rate; -- The country's first-ever green bond for US$750 million due in 2036 at a 6.6% interest rate; and -- A reopening of US$500 million for a bond due in 2031 at a 7.05% interest rate. The ratings on the bonds are the same as the long-term foreign currency sovereign credit rating on the Dominican Republic (BB/Stable/B). The Dominican Republic used the resources to roll over around US$1 billion of an external bond maturing in 2025, and it will use the rest of the proceeds for general budgetary purposes. The government will allocate the resources from the $750 million bond to eligible green expenditures under the Dominican Republic's green, social, and sustainable bond framework. S&P's 'BB' long-term ratings on the Dominican Republic reflect its fast-growing and resilient economy. Despite its vulnerability to external shocks, the country has proven its capacity to rapidly bounce back in the aftermaths, thanks to somewhat predictable economic policies. The ratings also incorporate the country's historical political and social challenges in passing structural reforms to contain fiscal deficits. A strong mandate following presidential, legislative, and municipal elections this year could grant the government an opportunity to pass such reforms. The ratings are constrained by relatively high debt, a hefty interest burden, and limited monetary policy flexibility. The stable outlook reflects S&P's expectation of continued favorable GDP growth and policy continuity that will likely stabilize the government's debt burden. ============= J A M A I C A ============= EDUFOCAL: Incurs $79 Million Loss in 2023 ----------------------------------------- RJR News reports that EduFocal is reporting a loss of just over $79 million for the financial year ended December 2023. The company said, during the comparative period ended December 2022, it recorded a loss of $179 million, according to RJR News. EduFocal says this is mainly due to an increased bad debt write off of $65.7 million and an impairment amounting to $38.4 million, the report notes. EduFocal posted increased revenues of $264 million for the financial year ended December 2023, the report relays. This is compared with the $187 million made in the corresponding period the prior year, the report adds. About Jamaica Jamaica is an island country situated in the Caribbean Sea. Jamaica is an upper-middle income country with an economy heavily dependent on tourism. Other major sectors of the Jamaican economy include agriculture, mining, manufacturing, petroleum refining, financial and insurance services. In October 2023, Moody's upgraded the Government of Jamaica's long-term issuer and senior unsecured ratings to B1 from B2, and senior unsecured shelf rating to (P)B1 from (P)B2. The outlook has been changed to positive from stable. The upgrade of Jamaica's rating to B1 reflects the government's sustained commitment to fiscal consolidation and debt reduction. The positive outlook reflects Moody's assessment that a continuation of the favorable fiscal trajectory will further increase Jamaica's credit resilience. S&P Global Ratings raised on September 13, 2023, its long-term foreign and local currency sovereign credit ratings on Jamaica to 'BB-' from 'B+', and affirmed its short-term foreign and local currency sovereign credit ratings at 'B'. The stable outlook reflects S&P's expectation that the government will remain committed to prudent fiscal policies and reducing debt, as well as supportive economic policies including a flexible exchange rate regime and effective monetary policy. In March 2022, Fitch Ratings affirmed Jamaica's Long-Term Foreign Currency Issuer Default Rating (IDR) at 'B+'. The Rating Outlook is Stable. JETAIR CARIBBEAN: Halts Operations Amid Bankruptcy -------------------------------------------------- RJR News reports that airline company JetAir Caribbean had suspended all flights from Curacao to Kingston, Jamaica. The Court of First Instance of Curacao declared JetAir bankrupt, according to RJR News. JetAir was the sole airline based in Aruba, Curaçao, and Bonaire with jet aircraft, operating scheduled flights connecting Curaçao with Aruba, Bonaire, Jamaica, the Dominican Republic, Haiti, St. Maarten, Suriname, and Colombia, the report notes. The airline received its operating permit in November 2019, just before the onset of the COVID-19 pandemic, the report recalls. After the pandemic, JetAir aggressively resumed its services, targeting routes from Curaçao to Colombia, Jamaica, the Dominican Republic, Haiti, and St. Maarten, the report notes. However, the expansion of local airlines Winair and Z Air, alongside the emergence of low-cost Arajet and the expansion of Sky High, constrained JetAir's limited operations, the report says. Additionally, the high operating costs of its Fokker 70 aircraft forced JetAir to ground one for spare parts, the report relays. JetAir has reported losses of more than US$1 million, resulting in JetAir ceasing operations, the report adds. JMMB GROUP: Suffers $12.6 Billion Impairment -------------------------------------------- RJR News reports that JMMB Group CEO Keith Duncan says the company suffered a major impairment in the last financial year. Mr. Duncan said the financial group had a J$12.6 billion impairment which came from the group's investment in an energy project, according to RJR News. "This would be in the main attributed to a very early start of greenfield transaction in the energy sector which was rated investment grade by CariCRIS and a global asset and as a result got wide sub-regional support from the financial sector. This investment, in spite of challenges, was able to produce but ran into supply contract difficulties and has not been able to continue operations and serve its debt obligations," he pointed out, the report notes. Mr. Duncan revealed that the management of the energy company is working along with note holders to find ways to recover some or make full recovery of the impairment, the report relays. He added that JMMB has also taken steps to reduce the possibility of this happening again, the report says. "This is a one-off impairment - and I stress it's a one-off impairment - and this will not be repeated as JMMB is revising its investment policy statement to establish limits in relationship capital that will ensure that JMMB will not experience losses of this magnitude from an early start of greenfield investment going forward," he maintained, the report notes. Meanwhile, the JMMB Group CEO has disclosed that the company made J$11.8 billion in profit for the financial year ended March 2024, the report discloses. Mr. Duncan was speaking at the company's 'Year-End Investor Briefing,' the report adds. About Jamaica Jamaica is an island country situated in the Caribbean Sea. Jamaica is an upper-middle income country with an economy heavily dependent on tourism. Other major sectors of the Jamaican economy include agriculture, mining, manufacturing, petroleum refining, financial and insurance services. In October 2023, Moody's upgraded the Government of Jamaica's long-term issuer and senior unsecured ratings to B1 from B2, and senior unsecured shelf rating to (P)B1 from (P)B2. The outlook has been changed to positive from stable. The upgrade of Jamaica's rating to B1 reflects the government's sustained commitment to fiscal consolidation and debt reduction. The positive outlook reflects Moody's assessment that a continuation of the favorable fiscal trajectory will further increase Jamaica's credit resilience. S&P Global Ratings raised on September 13, 2023, its long-term foreign and local currency sovereign credit ratings on Jamaica to 'BB-' from 'B+', and affirmed its short-term foreign and local currency sovereign credit ratings at 'B'. The stable outlook reflects S&P's expectation that the government will remain committed to prudent fiscal policies and reducing debt, as well as supportive economic policies including a flexible exchange rate regime and effective monetary policy. In March 2022, Fitch Ratings affirmed Jamaica's Long-Term Foreign Currency Issuer Default Rating (IDR) at 'B+'. The Rating Outlook is Stable. ===================== P U E R T O R I C O ===================== ESJ TOWERS: Gets Court Nod to Sell Assets to Fortaleza for $18MM ---------------------------------------------------------------- A U.S. bankruptcy judge has given the go-signal for ESJ Towers, Inc. to sell its assets to the winning bidder. Judge Enrique Lamoutte of the U.S. Bankruptcy Court for the District of Puerto Rico approved the sale of the assets to Fortaleza Equity Partners 2, LLC whose $18 million offer was selected as the winning bid. IPS Investment Fund, LLC and Greengift Capital, LLC's joint bid of $17.95 million was selected as the back-up bid at the May 8 auction. ESJ will use the proceeds from the sale to pay its creditors pursuant to its Chapter 11 plan of reorganization, which the court confirmed on May 21. The company currently owns and operates 126 studio apartments, which are classified either as vacation club or hotel units, and one hospitality center. About ESJ Towers ESJ Towers, Inc. owns the ESJ Towers in Carolina, P.R. The luxury apartments and condo units at ESJ Towers have direct access to Isla Verde Beach, widely considered one of the best in Puerto Rico. ESJ sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D.P.R. Case No. 22-01676) on June 10, 2022, with as much as 50 million in both assets and liabilities. ESJ President Keith St. Clair signed the petition. Judge Enrique S. Lamoutte Inclan oversees the case. The Debtor tapped Charles A. Cuprill, Esq., at Charles A. Cuprill, PSC Law Offices as bankruptcy counsel; Ramon Luis Nieves, Esq., at RL Legal Consulting Services, LLC and Luis Daniel Muniz, Esq., as special counsels; Dage Consulting CPAS, PSC as financial advisor; CPA Luis R. Carrasquillo & Co., P.S.C. as financial consultant; and De Angel & Compania, PA, LLC as auditor. The U.S. Trustee for Region 21 appointed an official committee of unsecured creditors on Sept. 12, 2022. The committee tapped the Law Office of Jonathan A. Backman as lead bankruptcy counsel; Julio Cesar Alejandro Serrano, Esq., at JCAS Law as local counsel; and Dage Consulting CPAS, PSC as financial advisor. The court confirmed the Debtor's Chapter 11 plan of reorganization on May 21, 2024. ================= V E N E Z U E L A ================= CITGO: Finc'l Alliances Build as Share Auction Enters Last Mile --------------------------------------------------------------- globalinsolvency.com, citing Reuters, reports that at least five groups of investors submitted binding bids this month in a U.S. court-ordered auction of shares in Citgo Petroleum's parent, and three have secured financing commitments for Venezuela's foreign crown jewel. In the last mile of an unprecedented auction to pay up to $21.3 billion from past expropriations and debt defaults in Venezuela, a federal court officer supervising the auction is working to evaluate bids from big investors and creditors, according to globalinsolvency.com. Wall Street banks JPMorgan and Morgan Stanley, and advisors and investors Rothschild & Co and Elliott Investment Management have secured financing for several offers, the report notes. The involvement of prominent investors and banks raise the chances of the auction producing a significant offer for the seventh-largest U.S. oil refiner following a first round in January criticized as "disappointing" by parties representing Venezuela in the Delaware case as the highest bid was $7.3 billion, the report relays. The auction is expected to be the culmination of a historic case that broke new legal ground in enforcement of international arbitration awards and cracking of sovereign and corporate immunity, the report discloses. "We reject the robbery of Citgo . . . Venezuela will not recognize any fraudulent transaction," Venezuela's Vice President Delcy Rodriguez said on X, the report relays. Venezuelan Oil Minister Pedro Tellechea called on the U.S. court to halt the auction, the report relays. The sale has attracted big name investors and energy and trading firms including Vitol, ConocoPhillips and Koch Industries," the report adds. About CITGO Petroleum Citgo Petroleum Corporation is a United States-based refiner, transporter and marketer of transportation fuels, lubricants, petrochemicals and other industrial products. Based in Houston, Texas, Citgo is majority-owned by PDVSA, a state-owned company of the Venezuelan government (although due to U.S. sanctions, in 2019, they no longer economically benefit from Citgo.) As reported in the Troubled Company Reporter-Latin America in June 2022, S&P Global Ratings affirmed its 'B-' long-term issuer credit ratings on CITGO Holding Inc. and core subsidiary CITGO Petroleum Corp. ********* 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 2024. 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 * * *