/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/241029.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 Tuesday, October 29, 2024, Vol. 25, No. 217 Headlines A R G E N T I N A ARGENTINA: IMF Casts Doubt Over Milei's Inflation Estimate ARGENTINA: Nubank is Taking New Look at Argentina Under Milei ARGENTINA: Seeks US$2.7-Billion Line to Cover Debt Maturities B E R M U D A WEATHERFORD INT'L: Moody's Ups CFR to Ba3 & Unsecured Notes to Ba1 B R A Z I L BRAZIL: Chief Sees Huge De-Anchoring of Inflation Expectations LIGHT SA: Seeks Chapter 15 Recognition C A Y M A N I S L A N D S ARADA SUKUK: Fitch Affirms 'B+' Rating on Unsecured Debt C O L O M B I A RUTA AL MAR: Fitch Lowers Rating on Secured Notes Due 2044 to BB- D O M I N I C A N R E P U B L I C DOMINICAN REPUBLIC: Engaged in Ponzi-like scheme, Ex-Exec Claims M E X I C O BANCO DEL BAJIO: Net Income Drops 8.4% to Mex$2.53BB From 3Q 2023 P U E R T O R I C O TUPPERWARE BRANDS: Reaches Deal to Form New Tupperware Company U R U G U A Y ACI AIRPORT SUDAMERICA: Fitch Affirms BB+ on 2032/2034 Sec. Notes - - - - - ================= A R G E N T I N A ================= ARGENTINA: IMF Casts Doubt Over Milei's Inflation Estimate ---------------------------------------------------------- Buenos Aires Times reports the International Monetary Fund (IMF) has cast doubt over the inflation expectations of President Javier Milei's government, with its latest forecast showing significant distance with the Casa Rosada's own estimates. In the latest edition of its World Economic Outlook report, IMF staff retained their existing growth projections for Argentina, predicting that gross domestic product will contract 3.5 percent this year, according to Buenos Aires Times. GDP will subsequently increase by five percent in 2025 and 2.6 percent in 2026, said the Fund, the report notes. However, IMF technicians differ greatly with the Milei administration on inflation, projecting 139 percent this year and 45 percent next year, the report relays. In its budget bill to Congress, the government projected consumer prices would rise 18 percent in 2025, the report notes. Government sources expect inflation to close out the year at 125 percent, before significantly slowing in the following 12 months, the report discloses. Most private consultancy firms forecast a figure of around 40 percent - closer to the IMF's projection, the report says. According to the Fund's staff, Argentina's projected inflation rate for 2024 would be the fourth-highest in the world behind Zimbabwe (407 percent), Sudan (242 percent) and South Sudan (216 percent), the report notes. Globally, IMF experts see global inflation continuing to ease, hitting 5.8 percent this year, before falling to 4.3 percent in 2025, the report relays. 'Almost Won' Global growth is expected to ease slightly to 3.2 percent this year and remain at that level in 2025, the IMF said in its report, Buenos Aires Times says. Global inflation will ease to 5.8 percent, dropping to 4.3 percent in 2025, the report discloses. "The battle against inflation is almost won," IMF chief economist Pierre-Olivier Gourinchas told reporters, the report relays. "The decline in inflation without a global recession is a major achievement," he added. The IMF report noted that global growth is expected to trend to a lacklustre 3.1 percent by 2029, and warned of growing risks to that metric, the report notes. Beneath the relatively calm outlook for growth through 2025, "the picture is far from monolithic," the Fund said, warning of "important sectoral and regional shifts" taking place over the past six months, the report discloses. There are also a number of downside risks to growth, Gourinchas said, highlighting the prospect of "an escalation in regional conflict, especially in the Middle East," the report notes. "Risks are intensifying which could push up energy prices," warned Gourinchas, the report relays. The WEO's publication comes a day after the IMF and World Bank Annual Meetings got underway in Washington, bringing together finance ministers and central bankers from around the world for meetings on the health of the global economy, the report says. Among the officials in Washington is Argentina's Economy Minister Luis Caputo, who will attend a series of meetings with investors and officials from NGOs and business groups, the report notes. He will address the Council on Foreign Relations (CFR), but the main focus of the trip is talks with top IMF officials, the report notes. Caputo hopes to meet IMF Managing Director Kristalina Georgieva or her deputy Gita Gopinath while in Washington, the report relays. Regional Outlooks The United States, the world's largest economy, is now expected to grow by 2.8 percent this year, the report says. "We are close" to a soft landing for the US economy, Gourinchas said - meaning control of inflation without recession, the report notes. In Europe, growth is still trending higher, but remains low by historical standards, and is on track to be at an anaemic 0.8 percent this year, rising slightly to 1.2 percent in 2025, the report discloses. The Fund expects the growth in economic output in China to continue to cool, easing from 5.2 percent last year to 4.8 percent this year, and then falling further to 4.5 percent in 2025, the report says. The slowdown in India looks set to be more pronounced, with the IMF pencilling in growth of 7.0 percent this year, down from 8.2 percent in 2023, the report recalls. It is then set to slow even further to 6.5 percent, as the "pent-up demand accumulated during the pandemic" runs out, the IMF said, the report relays. The IMF expects growth in the Middle East and Central Asia to pick up slightly to 2.4 percent this year, before jumping to 3.9 percent in 2025 as the temporary effect of oil and shipping disruptions fade, the report notes. And in Sub-Saharan Africa, the IMF predicts that growth will remain unchanged at 3.6 percent this year, rising to 4.2 percent in 2025 as weather shocks abate and supply constraints ease, the report notes. Latin America and the Caribbean follows the general trend: economic growth of 2.1 percent in 2024, before picking up to 2.5 percent in 2025, the report notes. By 2024, Brazil is expected to grow by three percent, Mexico 1.5 percent, Colombia 1.6 percent, Chile 2.5 percent, Peru three percent, Ecuador 0.3 percent, Venezuela three percent, Bolivia 1.6 percent, Paraguay 3.8 percent and Uruguay 3.2 percent, the report adds. About Argentina Argentina is a country located mostly in the southern half of South America. Its capital is Buenos Aires. Javier Milei is the current president of Argentina after winning the November 19, 2023 general election. He succeeded Alberto Angel Fernandez in the position. Argentina has the third largest economy in Latin America. The country's economy is an upper middle-income economy for fiscal year 2019, according to the World Bank. Historically, however, its economic performance has been very uneven, with high economic growth alternating with severe recessions, income maldistribution and in the recent decades, increasing poverty. In March 2022, the International Monetary Fund (IMF) approved a new 30-month arrangement under an Extended Fund Facility for Argentina in the amount of SDR 31.914 billion (equivalent to US$44 billion, or 1000 percent of quota). The IMF Executive Board's decision allowed the authories an immediate disbursement of an equivalent of US$9.65 billion in March 2022. Argentina's IMF-supported program seeks to improve public finances and start to reduce persistent high inflation through a multi-pronged strategy, involving a gradual elimination of monetary financing of the fiscal deficit and enhancements in the monetary policy framework. In June 2024, the IMF Board completed an eighth review of the Extended Arrangement under the Extended Fund Facility for Argentina. The IMF Board's decision enabled a disbursement of around US$800 million to support the authorities' efforts to entrench the disinflation process, rebuild fiscal and external buffers, and underpin the recovery. S&P, in March 2024, raised its local currency sovereign credit ratings on Argentina to 'CCC/C' from 'SD/SD' and its national scale rating to 'raB+' from 'SD'. S&P also raised its long-term foreign currency sovereign credit rating to 'CCC' from 'CCC-' and affirmed its 'C' short-term foreign currency rating. The S&P ratings have been affirmed as of August 2024. S&P said the stable outlook on the long-term ratings balances the risks posed by pronounced economic imbalances and other uncertainties with recent progress in making fiscal adjustments, reducing inflation, and undertaking structural reforms to address long-standing microeconomic weaknesses that have contributed to poor economic performance for many years that it would likely consider to be distressed. In June 2023, Fitch ratings also upgraded Argentina's Long-Term Foreign Currency (FC) Issuer Default Rating (IDR) to 'CC' from 'C'and affirmed the Long-Term Local Currency (LC) IDR at 'CCC-'. The upgrade of the FC IDR reflects that Fitch no longer deems a default-like process to have begun, as the authorities have not signaled a clear intention to follow through with an intra-public debt swap announced in March 2023. The new 'CC' rating signals a default event of some sort appears probable in the coming years. The affirmation of the LC IDR at 'CCC-' follows the peso debt swap in June that Fitch did not deem to be a "distressed debt exchange" (DDE). Moody's Investors Service, in September 2022, affirmed Argentina's Ca foreign-currency and local-currency long-term issuer and senior unsecured ratings. The outlook remains stable. The decision to affirm the Ca ratings balances Argentina's limited market access, weak governance, and history of recurrent debt restructurings with recent efforts to marshal fiscal and monetary measures to start addressing underlying macroeconomic imbalances in the context of the IMF program that was approved in 2022, according to Moody's. DBRS, Inc. confirmed Argentina's Long-Term Foreign Currency Issuer Rating at CCC and downgraded its Long-Term Local Currency Issuer Rating to CCC from CCC (high) on March 3, 2023. ARGENTINA: Nubank is Taking New Look at Argentina Under Milei ------------------------------------------------------------- Buenos Aires Times reports that Nu Holdings Ltd is reassessing prospects for Argentina as all of Latin America roots for the success of President Javier Milei, Chief Executive Officer David Velez said. Nubank, as the firm is known, "will watch" Argentina over the next 12 months, and is "taking a new look" at the country under Milei, who took over in December, Velez saidin an interview at the Bloomberg New Economy at B20 in Sao Paulo, according to Buenos Aires Times. The report notes that Velez said that while Brazil can still contribute to the bank's growth, Mexico is the nation offering the biggest opportunity for now. He said 88 percent of Mexicans don't have access to credit, for example, the report relays. "It feels like Mexico is 50 years behind," he added. Velez added that the "sky is the limit" for the growth of verticals beyond financial services, citing telecommunications, health and education as relevant sectors, the report discloses. The vast majority of Nubank's business comes from Brazil, where it has about 95 million customers, the report relays. Mexico is second-biggest, followed by Colombia, the report notes. In a separate interview for Bloomberg Television, Velez said the company has ample opportunities to expand beyond financial services in Brazil, and will move into new countries in the next five to 10 years, the report discloses. The Hispanic market in the United States could also be an opportunity, he added. New Economy at B20 is being organised by Bloomberg Media Group, a division of Bloomberg LP, the parent company of Bloomberg News, the report adds. About Argentina Argentina is a country located mostly in the southern half of South America. Its capital is Buenos Aires. Javier Milei is the current president of Argentina after winning the November 19, 2023 general election. He succeeded Alberto Angel Fernandez in the position. Argentina has the third largest economy in Latin America. The country's economy is an upper middle-income economy for fiscal year 2019, according to the World Bank. Historically, however, its economic performance has been very uneven, with high economic growth alternating with severe recessions, income maldistribution and in the recent decades, increasing poverty. In March 2022, the International Monetary Fund (IMF) approved a new 30-month arrangement under an Extended Fund Facility for Argentina in the amount of SDR 31.914 billion (equivalent to US$44 billion, or 1000 percent of quota). The IMF Executive Board's decision allowed the authories an immediate disbursement of an equivalent of US$9.65 billion in March 2022. Argentina's IMF-supported program seeks to improve public finances and start to reduce persistent high inflation through a multi-pronged strategy, involving a gradual elimination of monetary financing of the fiscal deficit and enhancements in the monetary policy framework. In June 2024, the IMF Board completed an eighth review of the Extended Arrangement under the Extended Fund Facility for Argentina. The IMF Board's decision enabled a disbursement of around US$800 million to support the authorities' efforts to entrench the disinflation process, rebuild fiscal and external buffers, and underpin the recovery. S&P, in March 2024, raised its local currency sovereign credit ratings on Argentina to 'CCC/C' from 'SD/SD' and its national scale rating to 'raB+' from 'SD'. S&P also raised its long-term foreign currency sovereign credit rating to 'CCC' from 'CCC-' and affirmed its 'C' short-term foreign currency rating. The S&P ratings have been affirmed as of August 2024. S&P said the stable outlook on the long-term ratings balances the risks posed by pronounced economic imbalances and other uncertainties with recent progress in making fiscal adjustments, reducing inflation, and undertaking structural reforms to address long-standing microeconomic weaknesses that have contributed to poor economic performance for many years that it would likely consider to be distressed. In June 2023, Fitch ratings also upgraded Argentina's Long-Term Foreign Currency (FC) Issuer Default Rating (IDR) to 'CC' from 'C'and affirmed the Long-Term Local Currency (LC) IDR at 'CCC-'. The upgrade of the FC IDR reflects that Fitch no longer deems a default-like process to have begun, as the authorities have not signaled a clear intention to follow through with an intra-public debt swap announced in March 2023. The new 'CC' rating signals a default event of some sort appears probable in the coming years. The affirmation of the LC IDR at 'CCC-' follows the peso debt swap in June that Fitch did not deem to be a "distressed debt exchange" (DDE). Moody's Investors Service, in September 2022, affirmed Argentina's Ca foreign-currency and local-currency long-term issuer and senior unsecured ratings. The outlook remains stable. The decision to affirm the Ca ratings balances Argentina's limited market access, weak governance, and history of recurrent debt restructurings with recent efforts to marshal fiscal and monetary measures to start addressing underlying macroeconomic imbalances in the context of the IMF program that was approved in 2022, according to Moody's. DBRS, Inc. confirmed Argentina's Long-Term Foreign Currency Issuer Rating at CCC and downgraded its Long-Term Local Currency Issuer Rating to CCC from CCC (high) on March 3, 2023. ARGENTINA: Seeks US$2.7-Billion Line to Cover Debt Maturities ------------------------------------------------------------- Manuela Tobias & Jorgelina do Rosario at Bloomberg News reports that Argentina's government is in talks with several banks to obtain a loan agreement of around US$2.7 billion for about three years in order to meet its principal debt obligations next January, according to a person familiar with the negotiation. Banco Santander SA and JPMorgan Chase & Co are most involved in talks for the so-called "repo line" that's being carried out by Argentina's Central Bank, according to another person with direct knowledge, according to Bloomberg News. Both requested anonymity to discuss the private negotiations, Bloomberg News notes. It's unclear how much money Argentina would receive from each bank, nor the collateral the government is putting up in the deal, Bloomberg News relays. Santander didn't immediately reply to requests for comment. JPMorgan declined to comment. Economy Minister Luis Caputo spoke before a crowded room at an event organised by Banco Santander SA's corporate and investment banking division on the sidelines of the IMF annual meetings, Bloomberg News notes. President Javier Milei's economic team, which is in Washington attending the International Monetary Fund and World Bank Group's annual meetings, has started to telegraph the country's vision for what a new program with the IMF could look like, Bloomberg News says. Formal negotiations with the Fund have yet to begin, one of the people said, Bloomberg News relays. Argentina's US$44-billion program, originally negotiated by former president Mauricio Macri and renegotiated by Milei's predecessor Alberto Fernandez, is the Washington-based lender largest - and its 22nd with the crisis-prone country, Bloomberg News notes. Argentina is counting on the IMF for an injection of reserves only it can offer for Milei to dismantle an edifice of capital and currency controls left behind by the last government to reenter capital markets and reboot economic growth, Bloomberg News discloses. A wide gap still remains between Fund staff and Milei's economic visions, Bloomberg News relays. The Fund has repeatedly asked for positive interest rates, more flexible currency policy and rebuilding of foreign reserves that are seen as the weakest part of Milei's economic program, Bloomberg News says. Tensions peaked in September when the IMF pulled Rodrigo Valdes, its top negotiator, from the program after Milei railed against him as "truly irresponsible" for greenlighting the previous government's policies, Bloomberg News notes. Before a group of investors, Caputo said Argentina was considering all options to lift capital controls, even in the absence of a new programme with the Fund, according to people with direct knowledge, Bloomberg News discloses. The economy minister expects inflation to converge to the peso's two-percent monthly devaluation rate, known as the crawling peg, which Milei has previously said could trigger a slowdown of the crawl to one percent a month, Bloomberg News says. Milei also noted recently that once he lifts capital controls, he'll opt for a "flexible" exchange rate, without providing more details, Bloomberg News adds. About Argentina Argentina is a country located mostly in the southern half of South America. Its capital is Buenos Aires. Javier Milei is the current president of Argentina after winning the November 19, 2023 general election. He succeeded Alberto Angel Fernandez in the position. Argentina has the third largest economy in Latin America. The country's economy is an upper middle-income economy for fiscal year 2019, according to the World Bank. Historically, however, its economic performance has been very uneven, with high economic growth alternating with severe recessions, income maldistribution and in the recent decades, increasing poverty. In March 2022, the International Monetary Fund (IMF) approved a new 30-month arrangement under an Extended Fund Facility for Argentina in the amount of SDR 31.914 billion (equivalent to US$44 billion, or 1000 percent of quota). The IMF Executive Board's decision allowed the authories an immediate disbursement of an equivalent of US$9.65 billion in March 2022. Argentina's IMF-supported program seeks to improve public finances and start to reduce persistent high inflation through a multi-pronged strategy, involving a gradual elimination of monetary financing of the fiscal deficit and enhancements in the monetary policy framework. In June 2024, the IMF Board completed an eighth review of the Extended Arrangement under the Extended Fund Facility for Argentina. The IMF Board's decision enabled a disbursement of around US$800 million to support the authorities' efforts to entrench the disinflation process, rebuild fiscal and external buffers, and underpin the recovery. S&P, in March 2024, raised its local currency sovereign credit ratings on Argentina to 'CCC/C' from 'SD/SD' and its national scale rating to 'raB+' from 'SD'. S&P also raised its long-term foreign currency sovereign credit rating to 'CCC' from 'CCC-' and affirmed its 'C' short-term foreign currency rating. The S&P ratings have been affirmed as of August 2024. S&P said the stable outlook on the long-term ratings balances the risks posed by pronounced economic imbalances and other uncertainties with recent progress in making fiscal adjustments, reducing inflation, and undertaking structural reforms to address long-standing microeconomic weaknesses that have contributed to poor economic performance for many years that it would likely consider to be distressed. In June 2023, Fitch ratings also upgraded Argentina's Long-Term Foreign Currency (FC) Issuer Default Rating (IDR) to 'CC' from 'C'and affirmed the Long-Term Local Currency (LC) IDR at 'CCC-'. The upgrade of the FC IDR reflects that Fitch no longer deems a default-like process to have begun, as the authorities have not signaled a clear intention to follow through with an intra-public debt swap announced in March 2023. The new 'CC' rating signals a default event of some sort appears probable in the coming years. The affirmation of the LC IDR at 'CCC-' follows the peso debt swap in June that Fitch did not deem to be a "distressed debt exchange" (DDE). Moody's Investors Service, in September 2022, affirmed Argentina's Ca foreign-currency and local-currency long-term issuer and senior unsecured ratings. The outlook remains stable. The decision to affirm the Ca ratings balances Argentina's limited market access, weak governance, and history of recurrent debt restructurings with recent efforts to marshal fiscal and monetary measures to start addressing underlying macroeconomic imbalances in the context of the IMF program that was approved in 2022, according to Moody's. DBRS, Inc. confirmed Argentina's Long-Term Foreign Currency Issuer Rating at CCC and downgraded its Long-Term Local Currency Issuer Rating to CCC from CCC (high) on March 3, 2023. ============= B E R M U D A ============= WEATHERFORD INT'L: Moody's Ups CFR to Ba3 & Unsecured Notes to Ba1 ------------------------------------------------------------------ Moody's Ratings upgraded the ratings of Weatherford International Ltd. (Bermuda), including its Corporate Family Rating to Ba3 from B1, Probability of Default Rating to Ba3-PD from B1-PD, the rating on the backed senior unsecured notes to B1 from B2 and the rating on the backed senior secured bank credit facilities to Baa3 from Ba1. The SGL-1 Speculative Grade Liquidity Rating (SGL) remains unchanged. The outlook is positive. "The upgrade of Weatherford's ratings reflects its strong operating performance and improvement in the company's credit profile," stated James Wilkins, Moody's Ratings Vice President. "The positive outlook reflects supportive global oilfield services fundamentals, strong demand for the company's services and the potential for further improvement in Weatherford's credit profile." RATINGS RATIONALE The upgrade of Weatherford's CFR to Ba3 reflects strong operating performance, improving credit metrics and favorable global industry fundamentals in certain markets. The company has experienced revenue growth outside of the US, which accounts for over 80% of its revenue and offshore markets as it has won new business and gained pricing power. Positive free cash flow generation has also benefitted from its business transformation, cost reduction efforts, focus on efficiencies and an emphasis on profitable growth that have expanded profit margins. The EBITDA margin for the LTM ended June 30, 2024 was 23.5%, up from 12.4% in 2019. Free cash flow has been applied towards debt reduction, lowering leverage and improving credit metrics. As of June 30, 2024, debt had decreased by over $1 billion since year-end 2020 and leverage was 1.5x, which is low compared to 'Ba' rated peers. Following its strong free cash flow generation, in mid-2024, the company implemented a capital allocation framework that includes a dividend ($1 per share p.a., paid quarterly) starting in the third quarter 2024 and a $500 million share repurchase program. Weatherford is targeting gross leverage below 1x, while maintaining liquidity of approximately $1 billion. Therefore, Moody's expect the company's credit metrics to continue to improve as it further reduces debt. Weatherford benefits from its large scale (comparable to the biggest oilfield services companies), a broad product range, and significant geographic and customer diversification, with a substantial portion of revenue coming from more stable international markets. The company's numerous patented products and technologies are well-known and widely used in the oilfield services industry, providing competitive advantages and leading market positions in several product categories. The company's debt capital structure includes obligations under the secured credit facilities and the unsecured notes due 2030, which are all obligations of Weatherford International Ltd. (Bermuda) as well as other entities as borrowers (in the case of the credit facilities) or a co-issuer (in the case of the notes). The obligations under the credit facilities have a secured claim to substantially all of the personal property of Weatherford International plc and the guarantors. The credit facilities are rated Baa3, three notches higher than the Ba3 CFR and the senior unsecured notes due 2030 are rated B1, one notch below the CFR, because of the more senior priority-claim secured debt in Weatherford's capital structure. Weatherford's SGL-1 rating reflects very good liquidity through 2025, supported by its revolving credit facility, unrestricted cash balance ($862 million as of June 30, 2024) and expected positive free cash flow generation. Weatherford has a $720 million credit agreement that provides $327 million of commitments for performance letters of credit and $393 million of commitments for revolving borrowings and/or letters of credit as of June 30, 2024. (There were no borrowings under the credit facility and the company had $389 million of letters of credit outstanding as of the end of the second quarter 2024, including $337 million issued under the credit agreement and $52 million of additional letters of credit under various bilateral agreements, some of which were collateralized with restricted cash.) The credit agreement has financial covenants that require the company to maintain at least $250 million of liquidity (cash plus availability under the credit facility), a minimum interest coverage ratio of 2.5x, a maximum consolidated net leverage ratio (debt/EBITDA) of 3.5x and a maximum consolidated net secured leverage ratio of 1.5x. Moody's expect the company to maintain ample headroom for future compliance with these covenants through the end of 2025. The next notes maturity is the $1.6 billion of unsecured notes due in 2030. The positive outlook reflects Moody's expectation Weatherford will benefit from growing demand for its oilfield services and will continue to generate positive free cash flow, reduce debt and further improve its credit profile. Furthermore, Moody's expect Weatherford will continue to maintain a strong balance sheet under tis financial policies. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The CFR could be upgraded if Weatherford continues to successfully achieve it business objectives (e.g., reducing costs and expanding profit margins) and generates positive free cash flow, further reduces debt (improving its credit metrics) and maintains financial policies supportive of a higher rating, while sustaining leverage under 2x. The CFR could be downgraded if the company engages in debt-funded acquisitions, adopts more aggressive financial policies or leverage is sustained above 3.0x. Weatherford International Ltd. (Bermuda) is a wholly-owned subsidiary of Weatherford International plc, which is incorporated in Ireland, and is a diversified international provider of a wide range of services and equipment to the global oil and gas industry. The principal methodology used in these ratings was Oilfield Services published in January 2023. =========== B R A Z I L =========== BRAZIL: Chief Sees Huge De-Anchoring of Inflation Expectations -------------------------------------------------------------- globalinsolvency.com, citing Reuters, reports that Brazil's central bank chief Roberto Campos Neto highlighted a "huge" de-anchoring of inflation expectations in the country, adding that it is "very important" to bring inflation back to the 3% target, and policymakers are committed to doing so, according to globalinsolvency.com. Speaking at an event hosted by the 20-20 Investment Association, Campos Neto said tight labor market data indicates the need to closely monitor services inflation, the report notes. He also reiterated that policymakers chose not to provide monetary guidance to allow time to assess the evolving scenario, 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. Moody's credit rating for Brazil was last set at Ba2 with positive outlook as of May 2024. S&P Global Ratings raised on Dec. 19, 2023, its long-term global scale ratings on Brazil to 'BB' from 'BB-'. Fitch Ratings affirmed on Dec. 15, 2023, Brazil's Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'BB' with a Stable Outlook. DBRS' credit rating for Brazil was last reported at BB with stable outlook at July 2023. LIGHT SA: Seeks Chapter 15 Recognition -------------------------------------- Emlyn Cameron of Law360 reports that Light SA, the parent company of a big Brazilian electrical utility, has petitioned a Texas bankruptcy judge for U.S. recognition of its foreign insolvency case. The company reported that a Brazilian court has authorized a restructuring plan to manage around $2 billion in debt, with considerable backing from creditors. About Light SA Light SA is an integrated company of the energy sector in Brazil, active in power generation, transmission, distribution and trading. Light SA sought relief under Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D. Tex. Case No. 24-90531) on Oct. 15, 2024, to seek U.S. recognition of its proceedings in the 3rd Business Court of Rio de Janeiro. White & Case LLP, led by Charles R. Koster, is the U.S. counsel. =========================== C A Y M A N I S L A N D S =========================== ARADA SUKUK: Fitch Affirms 'B+' Rating on Unsecured Debt -------------------------------------------------------- Fitch Ratings has affirmed UAE-based property developer Arada Developments LLC's Long-Term Issuer Default Rating (IDR) at 'B+' with a Stable Outlook and its senior unsecured debt at 'BB-' with a Recovery Rating of 'RR3'. The latter also apply to Arada Sukuk Limited's and Arada Sukuk 2 Limited's instruments. The affirmation reflects Arada's relatively high leverage and its project and geographic concentration. This concentration risk is somewhat mitigated by the prudent approach to development. Arada's trading performance is positive, benefiting from regional economic growth and residential demand. Gross debt/EBITDA at end 2023 was 5.9x and Fitch expects it to reduce in the next two years when the major phases of current projects will be delivered. Arada's 'B+' IDR is derived from its Standalone Credit Profile (SCP) of 'b' and a one-notch uplift for Sharjah government support, as assessed under Fitch's Government Related Entity (GRE) criteria. Key Rating Drivers Leading Sharjah Developer: Arada is the largest master-plan developer in Sharjah with a 51% market share of off-plan home sales by volumes in 2023. The company mainly specialises in delivering villas and low-rise residential buildings within its master developments, while opportunistically building high-rise towers. Arada's newly-built communities typically comprise on completion a mix of residential units, schools, green spaces, shops and co-ordinated amenities. Since its inception in 2017, Arada has launched 14,900 units, 14,000 of which have been sold and 9,600 already delivered. High Leverage: 2023 gross debt/EBITDA was high at 5.9x (2022: 3.1x). The operating margins in 2023 were negatively affected by higher marketing and sales costs despite year-on-year revenue increase of 11.5%. Fitch expects the EBITDA margin to consistently exceed 20% (2023 reported: 18.3%) over the next 24 months, as sales volumes are projected to increase. Gross debt/EBITDA should reduce to around 4.5x by end-2024, further declining by 2025 when most of the phases already launched in Aljada and Masaar will be delivered. Buoyant Housing Demand: Demand for new, quality homes in Sharjah is robust. The local real estate market grew substantially in 1H24, with trade value surging by 35.6% compared with 2023, surpassing AED18.2 billion. Sales in the primary and secondary markets rose by 18% to 30%, depending on location and available offerings. There has been a significant change in buyer preferences, shifting from investors interested in smaller apartments to owner-occupiers looking for larger coastal apartments, townhouses, and villas. Sharjah's real estate market has traditionally benefited from rising prices in Dubai, as budget-conscious residents relocate. Development Pipeline On-Track: Arada's new developments in Sharjah are progressing according to schedule and in 2023 the company delivered over 2,500 units. Arada's largest project - Aljada - initiated in 2017, spans 2.2 million square meters (sqm) and will feature 25,000 apartments, townhouses, and villas at completion in 2029. It will also include extensive green spaces, retail, schools, and various other amenities. 40% of the total units have been launched and 97% of these have been sold. Masaar, the upscale community encompassing 1.8 million sqm of villas and townhouses, 60% completed, is due for completion in 2026, with around 90% of units launched so far sold. Limited Diversification Beyond Sharjah: Arada is extending its presence away from Sharjah, mostly into prime locations in Dubai. In late 2022, it introduced Jouri Hills at Jumeirah Golf Estates, which comprises 294 villas and townhouses and it is working on the upscale Armani Beach Residences at Palm Jumeirah (25% of units sold). A branded residential tower is in its design phase and will be launched in DIFC. In August 2024, Arada set up a local branch in Australia where it has procured some land bank with the aim of launching new residential projects from 2025. Over the past three years, UAE buyers of Arada's properties have reduced to 8% from 47%, while buyers from regions outside GCC have grown to 77% from 30%, including expat residents. Development Risk Mitigated: Arada acquired land in Sharjah through deferred payments to reduce upfront cash outlays. Before starting construction, Arada targets minimum pre-sales of 60%-65%. Buyers provide deposits (typically 10%), which together with instalments (based on building milestones) substantially fund all construction costs. Buyers pay the remainder (usually 70%) at handover. If a buyer defaults, Arada can keep the payments and sell the unit. Construction risk is mitigated by fixed-price, lump-sum contracts and 10% performance bonds from contractors. Unlike Dubai, Sharjah does not require developers to manage cash-flows through escrow accounts. Government Support Beneficial: Arada is an integral part of Sharjah's development plans for the real estate sector. It benefits from the support of the local government in accessing premium land and enjoying deferred land payment plans, as was the case for the land where the Aljada community is being built. Funded by a government-backed facility of AED1.6 billion, it has to be repaid in 16 years. Under its GRE criteria, Fitch views government oversight and precedents of support as strong, therefore adding a one notch-uplift to Arada's SCP. Derivation Summary Operating and regulatory environments vary significantly across EMEA, which limits comparability. Across Fitch's Homebuilder Navigator peers there are different risk profiles for different residential markets. In France, there is little upfront capital outlay for land, and purchaser deposits fund capex. In the UK and Spain, upfront land outlay and the bulk of the purchase price is paid upon completion. This is similar to UAE markets, although the UAE tends to be more volatile than Western European markets. Arada operates primarily in the Emirate of Sharjah, which is smaller and less developed than Dubai (where the company has also 4 projects) and Abu Dhabi, but less volatile. Arada is the primary master-plan developer in Sharjah, which has had little community development, and it has a strong competitive advantage there, particularly owing to government support from the Sharjah government. This includes access to land, which is critical in the UAE markets. Arada is also developing projects in Dubai, helping reduce its high geographic concentration. However, it does not receive Sharjah government support for these projects and must compete with other UAE companies, including larger, established developers such as Damac Real Estate Development Limited, Binghatti Holding Ltd. (B+/Positive,) Emaar Properties PJSC (BBB/Stable), and Aldar Properties PJSC. The latter two are significant master-plan builders with material international operations. None of these developers has a material presence in Sharjah. In contrast to Arada, Emaar and Aldar are conglomerates with significant portfolios of investment properties generating stable, recurring revenue. Arada's community projects include supporting assets, such as retail businesses and schools, which are retained and generate recurring revenue. Along with several other businesses owned by Arada, these are increasing and diversifying recurring cash flows, but these are expected to remain a small part of total revenue. Consequently, Arada will remain predominantly exposed to volatile development cash flows. Arada is smaller and less established than UK-based Miller Homes Group (Finco) PLC (B+/Stable), or Spanish housebuilders AEDAS Homes, S.A. and Via Celere Desarrollos Inmobiliarios, S.A.U. (both rated BB-/Stable). These companies have relatively good geographic and project diversity compared with Arada, but do not benefit from government support and its related competitive advantages. However, Sharjah, and the UAE tend to experience more economic and real estate market volatility. Key Assumptions Fitch's Key Assumptions within its Rating Case for the Issuer: - Significant revenue growth to over AED8 billion by 2026 supported by the deliveries of new and existing projects (Aljada and Masaar) - Growing EBITDA margins at or above 25% - Working capital requirements to average AED1.5 billion per year in the next three years. This includes discretionary land acquisitions - Dividend distribution of AED150 million and AED250 million in 2024 and 2025, respectively - Continuous negative free cash flow (FCF) during this expansion phase due to capex and working capital cash outflow Recovery Analysis Recovery Assumptions Fitch typically uses a liquidation approach for homebuilders, assuming that potential buyers for the company would be interested in valuable assets such as land and ongoing developments. Using figures at end-September 2024, prior-ranking debt totalled AED535 million, composed of bilateral banking credit facilities. The remaining unsecured debt (AED3.9 billion) mostly comprises sukuk instruments. The company has a committed AED50 million unsecured overdraft facility, which Fitch assumes to be fully drawn at default. The standard advance rate of 50% applied to the inventory (AED3,986 million), accounts receivables (AED1,661 million) and net property, plant and equipment (AED2,207 million) is also used for other peers in the region. After deducting 10% for administrative claims, its waterfall analysis generates a Recovery Estimate of 77% for the generic unsecured class of debt. As Arada's IDR is 'B+', the Recovery Rating is capped at 'RR3', resulting in a senior unsecured rating of 'BB-'/RR3 with a recovery output percentage capped at 70%. RATING SENSITIVITIES Arada's IDR Factors That Could, Individually or Collectively, Lead To Positive Rating Action/Upgrade - Positive FCF generation on a sustained basis - Sustained improvement in financial metrics leading to gross debt/EBITDA below 3.5x - Improved corporate governance structure - Reduced execution risk - Improved liquidity position Factors That Could, Individually Or Collectively, Lead To Negative Rating Action/Downgrade - Change in government support, weakening Arada's business and financial profiles - Gross debt/EBITDA above 4.5x - Liquidity score sustained below 1x - Negative FCF on a sustained basis - Overall softening of Sharjah's real estate market resulting in low pre-sales levels and delayed project launches Sukuk Rating Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - The senior unsecured rating would not be upgraded if Arada's IDR was upgraded to 'BB-' Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - The rating could be downgraded if Arada's Long-Term IDR was downgraded - Adverse changes to the roles and obligations of Arada under the sukuk's structure and documents Liquidity and Debt Structure Capital Structure Actively Managed: In June 2024, Arada established a sukuk programme for up to USD1 billion and drew down USD400 million (AED1.5 billion) out of it. Later in September, the company tapped its sukuk programme and issued an additional USD150 million (AED550 million). Following these transactions, the gross debt mainly comprised senior unsecured sukuk totaling the AED3,800 million maturing between 2027 and 2029 and around AED500 million of secured bank facilities. At 1H24 Arada's liquidity was satisfactory, with AED2,759 million of unrestricted cash. In 2023, the company completed a AED1,100 million (USD300 million) share capital increase to support the company's projects pipeline which was followed by an additional capital injection of AED200 million in September 2024. Issuer Profile Arada is a master-plan community developer currently focusing on the Emirate of Sharjah in the UAE. MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Fitch's latest quarterly Global Corporates Macro and Sector Forecasts data file which aggregates key data points used in its credit analysis. Fitch's macroeconomic forecasts, commodity price assumptions, default rate forecasts, sector key performance indicators and sector-level forecasts are among the data items included. ESG Considerations Arada has an ESG Relevance Score of '4' for Governance Structure due to the weak structure of the board of directors compared with most EMEA peers. The board comprises five members, including the two shareholders, one independent director and the CEO. The limited number of independent board members has a negative impact on the credit profile, and is relevant to the rating in conjunction with other factors, which has a negative impact on the credit profile, and is relevant to the ratings in conjunction with other factors. The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Recovery Prior ----------- ------ -------- ----- Arada Sukuk Limited senior unsecured LT BB- Affirmed RR3 BB- Arada Developments LLC LT IDR B+ Affirmed B+ senior unsecured LT BB- Affirmed RR3 BB- Arada Sukuk 2 Limited senior unsecured LT BB- Affirmed RR3 BB- =============== C O L O M B I A =============== RUTA AL MAR: Fitch Lowers Rating on Secured Notes Due 2044 to BB- ----------------------------------------------------------------- Fitch Ratings has downgraded P.A. Concesión Ruta al Mar (Ruta al Mar) UVR-denominated senior secured notes due in 2044 to 'BB-' from 'BB+' and to 'A+(col)' from 'AA(col)'. The Rating Outlook is Negative. The downgrade reflects Fitch's view that issuer's payment capacity has weakened due to traffic underperformance throughout 2024, inability to increase tariffs over the last couple of years, and the significant delay in addressing completion issues. These issues mainly refer to the recovery of lost revenues at the Caimanera toll booth and the resolution of the pending Liability Exoneration Events (LEEs) in Functional Units (UFs) 2, 6, 7 and 8, which have constrained the project's progress and the release of trapped cash corresponding to those UFs. The balances in the National Infrastructure Agency (ANI)'s Autonomous Sub-Account (ASA) and Surplus Sub-Account were insufficient and are expected to remain insufficient to cover compensation payments to the project. Consequently, the debt service coverage ratio (DSCR) in Fitch's cases are projected to be below 1x between 2026 and 2027. The Negative Outlook reflects the risk of having the debt service reserve account (DSRA) depleted by 2027 if no agreement is reached regarding Caimanera's lost revenues and LEEs in such a way to increase project's liquidity. It also reflects the potential for further revenue deterioration if traffic continues to underperform or if inflationary tariff updates are not implemented in a timely manner. Fitch corrected an error identified in the financial model used in the March 2024 periodic rating review. The toll tariffs were not calculated using Fitch's assumptions regarding annual toll tariff adjustments and cashflows were overestimated. RATING RATIONALE The rating reflects the project's residual completion risk and delays in resolving issues and executing the corresponding contractual compensation mechanisms. It also reflects a fully demand based toll road with a diverse and mid-sized reference market that connects the center of Colombia with the northern coast and a defined rate-setting mechanism that allows for toll rates to be adjusted annually by inflation rate subject to grantor's approval. Debt structure is adequate despite some back-loading and a bullet-payment structure for one of the senior tranches. Fitch also views positively the presence of prepayment mechanisms in scenarios of traffic underperformance or outperformance, according to certain thresholds. Under Fitch's rating case DSCRs are projected to be 0.8x in 2026 and 0.6x in 2027. The 2026 shortfall is expected to be covered with cash available within the structure, but it would be insufficient to cover debt service payment in 2027, unless project revenue generation significantly improves and/or the project receives trapped revenues or liquid compensation payments from ANI. KEY RATING DRIVERS Revenue Risk - Volume - Midrange Toll road that serves a diverse, mid-sized reference market in the departments of Antioquia, Córdoba, Sucre and Bolívar, in Colombia connecting the central region of Colombia with the northern coast, serving a relevant role in the broader road network. The majority of its users are light vehicles, either commuters or tourists, with a projected increase of heavier vehicles once the works in the road are concluded. The road is expected to be a superior alternative than competing roads given the high specifications and average cost to end users. Revenue Risk - Price - Midrange Tariffs are legally adjusted by inflation on an annual basis according to the concession agreement. Toll rates are moderate, and differential tariffs are being applied by the government to specific vehicle categories on some of the toll stations. During 2023, tariff inflation adjustments were frozen according to government's Decree 050, which also states that ANI among other related institutions must design and apply necessary mechanisms in order to reinstate tariffs into 2024 expected values. Infrastructure Dev. & Renewal - Midrange The project depends on a moderately developed capital and maintenance plan funded from project cash flows only. The plan is to be implemented by the EPC contractor in the construction phase and by the concessionaire in the O&M phase. The IE believes the concessionaire has the experience and the ability to successfully operate the project. The O&M plan, organizational structure and budget are reasonable and in line with similar projects in Colombia. The structure includes a dynamic six-month, forward-looking O&M reserve equal to the O&M costs projected to be incurred during the next six months and a dynamic major maintenance reserve account equivalent to the maximum six-month major maintenance payment amount scheduled for the next 60 months. Debt Structure - 1 - Midrange All debt is senior pari passu and is denominated either in UVR or COP; all of the tranches are fully amortizing but one, which has a bullet payment structure. Interest payments for all tranches are indexed to inflation. The custom amortization profile is back-loaded with over 50% of repayments for all tranches concentrated on the last four years of their respective debt tenors. Structural features include a six-month principal and interest prefunded debt service reserve account, a lock-up test for dividends distribution, and mechanisms that are triggered in scenarios in which traffic performance is either significantly higher or lower than expected. ESG - Exposure to Social Impacts: Caimanera's toll booth was initially impacted and not effectively installed due to social disturbances in surrounding communities. This has resulted in project revenue loss, which has not been compensated by the grantor since 2Q 2024. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - Removal, relocation or modification of the Caimanera toll booth or its tariffs without a liquid compensation that mitigates the resulting loss of cash flows; - No resolution on pending LEEs or a negative result from projects current legal dispute regarding LEEs, presenting a lower percentage of release in UFs trapped cash, affecting debt service payment; - Traffic performance consistently below levels of 30,000 AADT in 2025 and 32,000 in 2026; - Failure to improve liquidity by end of 2025 such that short-term obligations could be fully funded. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - The Outlook could be revised to Stable if liquidity improves and provides an adequate buffer for debt service payments in 2026 and 2027. SECURITY Ruta al Mar is a public-private partnership concession based on a private initiative. The main purpose of the project is to develop a primary route with high performance specifications to ensure the Antioquia-Bolivar connection, and link the center and south of the country with the northern coast. The project consists of the construction, improvement and operation of a 491km long toll road located in Antioquia, Cordoba, Sucre and Bolivar, in Colombia. ESG Considerations P.A. Concesion Ruta al Mar's (Ruta al Mar) has an ESG Relevance Score of '4' for Exposure to Social Impacts, given Caimanera's tollbooth was initially impacted and not effectively installed due to social disturbances in surrounding communities. This resulted in lost revenues for the project, which have not been adequately compensated since the second half of 2024. For the other ESG credit relevance factors, the highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Prior ----------- ------ ----- P. A. Concesion Ruta al Mar P. A. Concesion Ruta al Mar/Toll Revenues - First Lien/1 LT LT BB- Downgrade BB+ P. A. Concesion Ruta al Mar/Toll Revenues - First Lien/1 Natl LT Natl LT A+(col)Downgrade AA(col) =================================== D O M I N I C A N R E P U B L I C =================================== DOMINICAN REPUBLIC: Engaged in Ponzi-like scheme, Ex-Exec Claims ---------------------------------------------------------------- Dominican Today reports that former Finance Minister Daniel Toribio Marmolejos has criticized the government's tax reform proposal, stating it stems from the administration being caught in a pyramid Ponzi scheme. He explained that since President Luis Abinader took office in 2020, the government has relied on extraordinary income by seeking advance payments from companies and financial institutions to cover spending, according to Dominican Today. In a recent interview, Toribio compared this approach to a Ponzi scheme, where money is borrowed to pay off previous debts, eventually leading to a point where there are no resources left to meet obligations, the report notes. He highlighted that the government secured funds from tax amnesties, advanced payments from large taxpayers, loans from Barrick Gold and commercial banks, and more recently from Aerodom, the report relays. Toribio warned that those who provided advance payments, such as banks and taxpayers, are now expecting the government to offset these amounts in their current taxes, revealing the strain on government finances, the report says. He emphasized that the push for tax reform is a consequence of this unsustainable financial practice, the report adds. About Dominican Republic The Dominican Republic is a Caribbean nation that shares the island of Hispaniola with Haiti to the west. Capital city Santo Domingo has Spanish landmarks like the Gothic Catedral Primada de America dating back 5 centuries in its Zona Colonial district. Luis Rodolfo Abinader Corona is the current president of the nation. TCR-LA reported in April 2019 that Juan Del Rosario of the UASD Economic Faculty cited a current economic slowdown for the Dominican Republic and cautioned that if the trend continues, growth would reach only 4% by 2023. Mr. Del Rosario said that if that happens, "we'll face difficulties in meeting international commitments." An ongoing concern in the Dominican Republic is the inability of participants in the electricity sector to establish financial viability for the system. Standard & Poor's credit rating for Dominican Republic was raised to 'BB' in December 2022 with stable outlook. Moody's credit rating for Dominican Republic was last set at Ba3 in August 2023 with the outlook changed to positive. Fitch, in December 2023, affirmed the Dominican Republic's Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'BB-' and revised the outlook to positive. =========== M E X I C O =========== BANCO DEL BAJIO: Net Income Drops 8.4% to Mex$2.53BB From 3Q 2023 ----------------------------------------------------------------- simplywall.st reports that Banco del Bajio S.A. Institucion de Banca Multiple posted key financial results for third quarter 2024: Revenue: Mex$5.73b (flat on 3Q 2023). Net income: Mex$2.53b (down 8.4% from 3Q 2023). Profit margin: 44% (down from 48% in 3Q 2023). EPS: Mex$2.12 (down from Mex$2.32 in 3Q 2023). simplywall.st discloses that Banco del Bajio Institucion de Banca missed expectations. Revenue was in line with analyst estimates, the report notes. Earnings per share (EPS) missed analyst estimates by 3.5%, the report relays. Looking ahead, revenue is forecast to grow 4.4% p.a. on average during the next 3 years, compared to a 14% growth forecast for the Banks industry in South America, the report adds. As reported in the Troubled Company Reporter-Latin America on Oct. 22, 2024, Fitch Ratings has affirmed Banco del Bajio S.A. Institucion de Banca Multiple's (BanBajio) Viability Rating (VR) at 'bb+' and its Long- and Short-Term Foreign and Local Currency Issuer Default Ratings (IDRs) at 'BB+' and 'B', respectively. Fitch has additionally affirmed BanBajio's Government Support Rating (GSR) at 'b+'. ===================== P U E R T O R I C O ===================== TUPPERWARE BRANDS: Reaches Deal to Form New Tupperware Company -------------------------------------------------------------- Tupperware Brands Corporation on Oct. 22, 2024, announced it has reached an agreement in principle with a group of its secured lenders, including Stonehill Capital Management Partners and Alden Global Capital. After years of struggling with an over-leveraged balance sheet and outdated operating model, the transaction would mark a new day for the iconic brand. The transaction is contemplated to be structured as a private sale of all intellectual property needed to create and market Tupperware's brand and award-winning products, plus operating assets in the United States and other foreign subsidiaries. Tupperware's Board of Directors hired President and Chief Executive Officer, Laurie Ann Goldman, in October 2023 to reinvent its go-to-market strategy for its valued independent sales consultants, retailers and consumers, and build a best-in-class leadership team. "Tupperware is considered the inventor of the party selling model and made no-leak food conservation products famous. Over the last year, we created a new strategy and operating approach that is digital-first, technology-led and asset-light, and preserved a global footprint for the Company," said Goldman. "We've made tremendous progress and are delighted this group of forward-thinking investors share our vision and will partner with us to grow." It is envisioned that The New Tupperware Company will be rebuilt with a start-up mentality using an agile methodology in dynamic phases. The initial focus will be on global core markets including the United States, Canada, Mexico, Brazil, China, Korea, India and Malaysia, and the new company intends to follow on with European and additional Asian markets. With its robust portfolio of award-winning, innovative products that consumers love and trust, the new company will continue to support entrepreneurship and a more sustainable lifestyle. Customers will be able to continue purchasing Tupperware products via independent Tupperware sales consultants, Tupperware ecommerce sites and retail partners in the global core markets. "We look forward to working with Tupperware's talented leadership team to execute on the go-forward strategy for this iconic brand," said a representative from the Lender Group. With the announcement of the proposed transaction, markets outside of the global core markets with heavy liabilities will wind down operationally. Goldman concluded, "Winding down parts of the Company will be a difficult but necessary decision to protect the future of the Tupperware brand. I want to thank all the wonderful people that will always be a part of the Tupperware family. Change and disruption are challenging, but at times, needed to move forward." The transaction is intended to close by the end of October 2024, subject to approval by the United States Bankruptcy Court for the District of Delaware and other customary closing conditions. Following closing, The New Tupperware Company will be privately held under the supportive ownership of the Lender Group. About Tupperware Brands Tupperware Brands Corporation (NYSE: TUP) -- https://www.tupperwarebrands.com/ -- is a global consumer products company that designs innovative, functional, and environmentally responsible products. Founded in 1946, Tupperware's signature container created the modern food storage category that revolutionized the way the world stores, serves, and prepares food. Today, this iconic brand has more than 8,500 functional design and utility patents for solution-oriented kitchen and home products. The company distributes its products into nearly 70 countries, primarily through independent representatives around the world. Tupperware Brands sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 24-12166) on Sept. 17, 2024. In the bankruptcy petition, Tupperware reported more than $1.2 billion in total debts and $679.5 million in total assets. Kirkland & Ellis LLP is serving as legal advisor to Tupperware, Moelis & Company LLC is serving as the Company's investment banker, and Alvarez & Marsal is serving as the Company's financial and restructuring advisor. Epiq is the claims agent and has put up the page https://dm.epiq11.com/Tupperware ============= U R U G U A Y ============= ACI AIRPORT SUDAMERICA: Fitch Affirms BB+ on 2032/2034 Sec. Notes ----------------------------------------------------------------- Fitch Ratings has affirmed the 'BB+' ratings of ACI Airport SudAmerica, S.A.'s $246.2 million senior secured notes (2021 notes) due in 2034 and $14.6 million senior secured notes (2015 and 2020 notes) due in 2032. The Rating Outlook is Stable. RATING RATIONALE The ratings are driven by Carrasco International Airport's (MVD) strategic but modest traffic base and its strong Origin & Destination profile. Traffic volatility is considered high and Fitch expects passenger traffic to grow at a low annual rate. The airport's capex plan is limited and will be supported by cash flow generation. The notes' scheduled and target amortization provide flexibility to the transaction in case of additional stress. It benefits from a six-month debt service reserve account (DSRA), which is funded with cash and letters of credit (LOCs). The debt is at the HoldCo level and benefits from a springing guarantee from the OpCo. Under Fitch's rating case, minimum and average debt service coverage ratios (DSCRs) are 0.96x (2024) and 1.7x, respectively. The DSCR below 1.0x in 2024 is mitigated by existing liquidity and USD15 million available in an unsecured working capital facility. Although average DSCR is commensurate with higher ratings, the DSCRs up to 2027 are close to 1.1x, which combined with the current limited liquidity, constrains the rating. KEY RATING DRIVERS Main Uruguayan Airport, Modest Catchment Area Located in Uruguay's capital city of Montevideo, MVD is the main international gateway to Uruguay with approximately 85% of the country's flights and a catchment area with 3.4 million people. As a result, its traffic has primarily been from international passengers traveling from Argentina, Chile, Brazil, as well as Spain. MVD is almost exclusively an O&D airport with less than 1% of passengers transferring to other destinations. The carrier concentration is moderate, with LATAM Airline Group S.A. (LATAM; BBB+(cl)/Positive) and Copa Airlines (not rated) accounting for 23% and 18% of the passengers, respectively. Fitch does not expect the six new regional airports added to the concession to increase the overall traffic base. Inflation and Exchange Adjusted Tariffs Revenues are 95% denominated in USD, mostly in the form of regulated passenger tariffs adjusted by a global index that considers foreign exchange and inflation rates. Tariffs cannot decrease under the concession adjustment scheme, and increases must be approved by the Uruguayan government pursuant to a decree. Commercial revenues derived from the airport's duty-free, restaurants, among other concessions, are not regulated but are also influenced by traffic patterns. Well-Defined Capex Plan for Regional Airports The concession includes six regional airports and some certain investment obligations expected to be funded with Montevideo's cash flow generation. As per the concession contract extension, the investments in the regional airports are capped at USD 67 million and, according to the technical advisor analysis (ALG), the investments are considered simple. Under the concession agreement, there is an obligation to build a new taxiway in MVD, which is triggered by volume or shall be completed up to 2033. The MVD current capacity of 4.5 million passengers per year is well above Fitch's Rating Case forecast over the next 10 years. Another amendment to the concession agreement was signed in May 2024, adding an investment in landing system which will be compensated through a tariff adjustment charged by PDS. No other significant mandatory investments are needed in the remaining concession term. Fully Amortizing Debt at HoldCo Level The notes are fixed-rate and fully amortizing over the life of the debt and benefit from a springing guarantee. Debt benefits from a six-month DSRA. The notes benefit from a legal amortization schedule complemented by a partial cash sweep up to a target debt balance. Failure to meet the target debt balance is not an event of default, therein providing flexibility to the transaction in the event that certain years perform below original expectations. Financial Profile Under Fitch's Rating Case, the project's DSCR profile (considering mandatory amortizations only) from 2024 to 2034 is strong, with a minimum and average of 0.96x and 1.70x. Average DSCR has slightly improved from Fitch's previous review, mainly driven by sustained improvement of passenger levels. DSCR below 1.0x for 2024 is mitigated by available liquidity, and Fitch does not expect the project to tap the DSRAs or hire working capital. PEER GROUP The closest peer in Fitch's portfolio is Sociedad Concessionaria Operadora Aeroportuaria Internacional, S.A. (OPAIN), the concessionaire of El Dorado International Airport in Bogota (BB+/Outlook Positive). Both airports are the main gateways in their respective countries, but OPAIN has a stronger volume risk assessment, a larger O&D base, and less dependence on international traffic. OPAIN's DSCR profile of 1.2x is consistent with its 'BB+' rating. Fitch projects a strong DSCR for ACI of above 1.7x from 2027 onwards. However, its short-term metrics, limited liquidity and weaker volume-risk assessment justify the same rating as OPAIN. OPAIN's Positive Outlook reflects the expectation of continued robust operational and financial performance, which has surpassed Fitch's scenarios and, if materialized in the future, could lead to an upward review in projections and, consequently, higher ratings. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - Traffic volume trend of less than 2.0 million passengers in 2025, which could lead to deterioration of liquidity; - Operational costs growth consistently above inflation; - Capex cost overruns that lead to the usage of working capital facilities. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - Traffic volume trend close to 2.2 million passengers in 2025, improving project's liquidity in the short-term; - Medium-term debt service coverage ratios above 1.3x. SECURITY The security package supporting the 2021 notes is typical for project finance and includes a pledge of the shares of the OpCo; a pledge of the shares of Cerealsur S.A., direct owner of PDS' shares, and a guarantee from the entity; all of the issuer's shares; and all present and future payments, proceeds and claims of any kind with respect to the foregoing, in a pari passu basis with the remaining 2015 and 2020 notes, and a pledge over account into which all dividends and distributions from PdS to Cerealsur and from Cerealsur to the Issuer are deposited. The 2021 notes benefit from a six-month DSRA, funded by a standby letter of credit. The 2021 notes also enjoyed a prefunded Interest Payment Account (IPA), which must be fully depleted in November of 2023. ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Prior ----------- ------ ----- ACI Airport SudAmerica, S.A. ACI Airport SudAmerica, S.A./Airport Revenues - First Lien/1 LT LT BB+ Affirmed BB+ ACI Airport SudAmerica, S.A./Airport Revenues – Subordinate Lien/2 LT LT BB+ Affirmed BB+ ********* 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 * * *