/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/060718.mbx T R O U B L E D C O M P A N Y R E P O R T E R E U R O P E Tuesday, July 18, 2006, Vol. 7, No. 141 Headlines A U S T R I A AMICOS ADVANCED: Vienna Court Terminates Bankruptcy Proceedings FUIOR: Creditors' Meeting Slated for July 25 GWT: Creditors' Meeting Slated for July 26 KELLNER: Property Manager Declares Insufficient Funds LANDHAUS MAXIMILIAN: Court Terminates Case due to Lack of Funds PROEL AUSTRIA: Creditors' Meeting Slated for July 31 ZORIC TROCKENBAU: Creditors' Meeting Slated for July 26 F R A N C E ALSTOM SA: Inks EUR45-Million Tram Deal with Angers Loire FIXED LINK: Moody's Cuts Rating on GBP620-Mln Notes to B2 * Moody's Notes Filing's Effect on Eurotunnel's Guarantors * Fitch Says Eurotunnel Won't Affect Guarantors' Ratings G E O R G I A METROMEDIA INTERNATIONAL: Reporting Preliminary Results Soon G E R M A N Y ABACOM VERMOGENS: Claims Registration Ends July 25 ALB AUTOLEASING: Claims Registration Ends August 10 ALLGEMEINE HYPOTHEKENBANK: Fitch Keeps C/RR6 on Deferred Payment ASAT HOLDINGS: April 30 Equity Deficit Tops US$53.2 Million BELOW HAUSTECHNIK: Claims Registration Ends August 1 FARBE CREATIV: Claims Registration Ends August 11 KIESA KIES: Claims Registration Ends August 1 LOTEXTIL GMBH: Claims Registration Ends July 19 OCH TRANSPORT: Creditors' Meeting Slated for July 28 SUNNY ISLAND: Claims Registration Ends August 9 TRANSMONT GMBH: Claims Registration Ends August 10 UDOPEA GESCHAFTSFUEHRUNGS: Creditors' Meeting Slated for July 27 VOLKSWAGEN AG: Cutting Jobs in Brazilian Plants I R E L A N D PULS CDO: Moody's Rates Class E Notes at (P)Ba3 K A Z A K H S T A N ALFA BANK: Moody's Changes Ba3 Deposit Rating Outlook to Stable DVIGATEL: Creditors Must File Claims by Aug. 7 KARAMALS: Creditors Must File Claims by Aug. 4 KAZZHELDORTRANS JSC: S&P Assigns BB+ Corp. Credit Rating KVART: Creditors Must File Claims by Aug. 7 MAGAS: Proof of Claim Deadline Slated for Aug. 7 MEGA: Proof of Claim Deadline Slated for Aug. 7 NORDPAK: Proof of Claim Deadline Slated for Aug. 7 SENTRGAZ-SERVIS: Claims Registration Ends Aug. 7 SHAMSHAR: Claims Registration Ends Aug. 7 TAMYZ FUDS: Claims Registration Ends Aug. 7 TIMSA: Creditors' Claims Due Aug. 7 KSHT: Claims Registration Ends Aug. 7 VEST-NAR: Creditors' Claims Due Aug. 4 K Y R G Y Z S T A N POLITEKS: Creditors Must File Claims by Aug. 25 TOYOTA MOTORS: Proof of Claim Deadline Slated for Aug. 25 N O R W A Y FALCONBRIDGE LTD: Inco & Phelps Dodge Increase Merger Offer R U S S I A BARYATINSKIY DIARY: Court Names F. Amarov as Insolvency Manager EVRAZ GROUP: Buys 24.9% of Highveld Steel From Anglo American FURNITURE FACTORY 555: E. Demicheva to Manager Assets GAZPROM: Agrees on Asset Swap Deal with E.ON AG GAZPROM: Board Forms Seven-Member Asset Evaluation Committee GRANITE: Court Names Mr. M.Khuako as Insolvency Manager KHVOSHEVSKAYA NIVA: Court Starts Bankruptcy Supervision KRONAS-WOOD: Ulyanovsk Court Begins Bankruptcy Supervision METROMEDIA INTERNATIONAL: Reporting Preliminary Results Soon MILOSLAVSKIY: Ryazan Court Starts Bankruptcy Supervision NORTH-WEST: Earns RUB1.41 Billion of Net Income in 2005 OZERNOYE: Court Names A. Trifonov as Insolvency Manager PARTNER-KURSK: Court Names Mr. N. Gutenev as Insolvency Manager PYATIGORSKIY LIQUEUR-VODKA: N. Sotskaya Named to Manage Assets ROL-TEX-MANUFACTURE: V. Chenskikh to Manage Insolvency Assets ROSNEFT OIL: Intends to Boost Production After IPO SAPSAN: Bankruptcy Hearing Slated for Aug. 2 TNK-BP FINANCE: Issues US$1.5-Billion Eurobonds for TNK-BP TNK-BP: Fitch Rates US$1.5 Billion Notes at BB+ TORAEVO: Court Names Mr. V. Demidov as Insolvency Manager TYUKALINSKIY: Court Starts Bankruptcy Supervision UFIMSKOYE REPAIR-TECHNICAL: Bankruptcy Hearing Slated for Aug. 1 U K R A I N E AGROSERVICE: Court Names Andrij Koveza as Insolvency Manager AURA: Mikolaiv Court Starts Bankruptcy Supervision FARIMED: Kyiv Court Appoints Andrij Koveza as Liquidator FORTUNA-KRYM: Court Names Atik Drogajtsev as Insolvency Manager INVEST-AGROPROM: Court Names Tax Authority as Liquidator KORVET-PLUS: Court Names Tax Agency as Liquidator KVANT-PLUS: Court Names Regional Tax Agency as Liquidator LADA: Court Names Kozyatin' State Tax Inspection as Liquidator LIVADA: Court Appoints Tax Agency to Liquidate Assets LVIVVODBUD: Court Starts Bankruptcy Supervision OLIVIYA: Court Names LLC Irida to Liquidate Assets PETRIVSKE-PLUS: Kirovograd Court Begins Bankruptcy Supervision REINFORCED METAL: Court Names Tetyana Pashkova as Liquidator ZALIZOBETON-MARKET: Court Names Tax Authority as Liquidator U N I T E D K I N G D O M ABSOLUTE FINISH: Creditors Confirm Voluntary Liquidation AEW DELFORD: Bank of Scotland Taps Receivers from PwC ALERIS INT'L: S&P Removes BB- Credit Rating from Watch Negative BREEZE BUILDING: Creditors Ratify Winding Up Resolution CASTLEGATE 399: Hires Deloitte & Touche to Administer Assets CEOL CASTLE: Creditors Nominate Liquidator CLUB A.C.: Taps G. W. Rhodes to Liquidate Assets CRAGSIDE CONTRACTORS: Creditors Resolve to Voluntary Liquidation CURTI LIFTS SOUTHERN: Confirms Liquidator's Appointment CURTI LIFTS SOUTHWEST: Creditors Pass Winding Up Resolution DIGITAL CONCEPTS: Financial Woes Trigger Liquidation DISTRIBUTION SOFTWARE: Appoints Liquidator from Crane & Partners DPS COMPOSITES: Creditors' Meeting Slated for July 20 ECLIPSE EMBROIDERY: Brings In Liquidator from Baker Tilly EGG BANKING: Moody's Changes Financial Strength Rating Outlook FAIRFIELD CLADDING: Hires Joint Liquidators from Begbies Traynor FIXED LINK: Moody's Cuts Rating on GBP620-Mln Notes to B2 FORD MOTOR: Moody's Lowers Senior Unsecured Ratings to B2 GENERAL MOTORS: Reviewing Nissan-Renault Deal; Toyota Might Bid HERTZ CORP: Parent Plans Initial Public Offering of Common Stock INCO LTD: Increase Falconbridge Merger Offer By CDN$1 Per Share INDUSTRIAL REPAIR: Creditors Opt to Liquidate Assets MANHATTAN PIZZA: Begins Liquidation Procedure MELLORSONS MANUFACTURING: Names Eileen T. F. Sale Liquidator MONACTIVE LIMITED: Hires Administrators from Baker Tilly O'SULLIVAN INDUSTRIES: Sells United Kingdom Business Operations QUIGLEY UNITED: Creditors' Meeting Slated for July 21 RICHARD GUEST: Names Andrew Clay as Administrator SHAW GROUP: Incurs US$16.7 Million Net Loss in Third Quarter SIGHT & SOUND: Creditors' Meeting Slated for July 24 SOLO CUP: Susan Marks Resigns as Chief Financial Officer SPECTRUM YARN: Appoints Tenon Recovery as Administrators TALKWORLD ONLINE: Joint Liquidators Take Over Operations THINKING FOOD: Calls In Begbies Traynor as Administrators VACUUMATIC LIMITED: Bank of Scotland Appoints PwC Receivers * Moody's Notes Filing's Effect on Eurotunnel's Guarantors * Fitch Says Eurotunnel Won't Affect Guarantors' Ratings * Large Companies with Insolvent Balance Sheets ********* ============= A U S T R I A ============= AMICOS ADVANCED: Vienna Court Terminates Bankruptcy Proceedings --------------------------------------------------------------- The Trade Court of Vienna terminated the bankruptcy proceeding of LLC Amicos Advanced Microcomputer Systems (FN 168156p) on May 23 due to the Debtor's administrative insolvency. This means that the Debtor does not have enough cash to cover costs of the bankruptcy proceedings. Headquartered in Vienna, Austria, the Debtor's bankruptcy case (Bankr. Case No. 4 S 42/06p) was removed from (Bankr. Case No. 36 S 28/05p) on March 6. FUIOR: Creditors' Meeting Slated for July 25 -------------------------------------------- Creditors owed money by LLC Fuior (FN 250448g) are encouraged to attend the creditors' meeting at 10:30 a.m. on July 25 to consider the adoption of the rule by revision and accountability. The creditors' meeting will be held at: The Trade Court of Vienna Room 1606 Vienna, Austria Headquartered in Vienna, Austria, the Debtor declared bankruptcy on May 24 (Bankr. Case 4 S 93/06p). Karl Schirl serves as the court-appointed property manager of the bankrupt estate. Markus Siebinger represents Dr. Schirl in the bankruptcy proceedings. The property manager and his representative can be reached at: Dr. Karl Schirl c/o Mag. Markus Siebinger Krugerstrasse 17/3 1010 Vienna, Austria Tel: 513 22 31 Fax: 513 22 31 -1 E-mail: dr.karl.schirl@der-rechtsanwalt.at GWT: Creditors' Meeting Slated for July 26 ------------------------------------------ Creditors owed money by Construction LLC GWT (FN 246219m) are encouraged to attend the creditors' meeting at 11:30 a.m. on July 26 to consider the adoption of the rule by revision. The creditors' meeting will be held at: The Trade Court of Vienna Room 1606 Vienna, Austria Headquartered in Vienna, Austria, the Debtor declared bankruptcy on Jan. 27 (Bankr. Case 4 S 18/06h). Thomas Deschka serves as the court-appointed property manager of the bankrupt estate. Robert Klein represents Dr. Deschka in the bankruptcy proceedings. The property manager and his representative can be reached at: Dr. Thomas Deschka c/o Dr. Robert Klein Huelben 1/15 1010 Vienna, Austria Tel: 513 99 39 Fax: 513 99 39 30 E-mail: deschka@lawcenter.at KELLNER: Property Manager Declares Insufficient Funds ----------------------------------------------------- Dr. Helmut Platzgummer, the court-appointed property manager for LLC Publishing Company Kellner (FN 99403g), declared on May 23 that the Debtor does not have enough assets to pay off creditors. The Trade Court of Vienna is yet to rule on the property manager's claim. Headquartered in Vienna, Austria, the Debtor declared bankruptcy on April 26 (Bankr. Case No. 3 S 63/06v). Caroline Klus represents Dr. Platzgummer in the bankruptcy proceedings. The property manager and his representative can be reached at: Dr. Helmut Platzgummer c/o Mag. Caroline Klus Kohlmarkt 14 1010 Vienna, Austria Tel: 533 19 39 Serie Fax: 533 19 39-39 E-mail: helmut.platzgummer@lp-law.at LANDHAUS MAXIMILIAN: Court Terminates Case due to Lack of Funds --------------------------------------------------------------- The Land Court of Wiener Neustadt will terminate the bankruptcy proceeding of LLC Landhaus Maximilian (FN 231871m) on May 29 due to the Debtor's administrative insolvency. This means that the Debtor does not have enough cash to cover costs of the bankruptcy proceedings. Headquartered in Vienna, the Debtor declared bankruptcy on July 21, 2005 (Bankr. Case No. 11 S 82/05b). Thomas Wanek served as the court-appointed property manager of the bankrupt estate. Valentin Piskernik represents Dr. Wanek in the bankruptcy proceedings. The property manager and his representative can be reached at: Dr. Thomas Wanek c/o Mag. Valentin Piskernik Hochstr. 31 2380 Perchtoldsdorf, Austria Tel: 01/8693888 Fax: 01/869166033 E-mail: anwalt@aon.at PROEL AUSTRIA: Creditors' Meeting Slated for July 31 ---------------------------------------------------- Creditors owed money by LLC Proel Austria (FN 238460b) are encouraged to attend the creditors' meeting at 9:45 a.m. on July 31 to consider the adoption of the rule by revision and accountability. The creditors' meeting will be held at: The Land Court of Linz Room 522 5th Floor Linz, Austria Headquartered in Muehlkreis, Austria, the Debtor declared bankruptcy on March 23 (Bankr. Case 12 S 48/06f). Sigrun Teufer-Peyrl serves as the court-appointed property manager of the bankrupt estate. Gunter Peyrl represents Mag. Teufer-Peyrl in the bankruptcy proceedings. The property manager and his representative can be reached at: Mag. Sigrun Teufer-Peyrl c/o Dr. Gunter Peyrl Pfarrgasse 20 4240 Freistadt, Austria Tel: 07942/75151 Fax: 07942/751519 E-mail: ra.peyrl@epnet.at ZORIC TROCKENBAU: Creditors' Meeting Slated for July 26 ------------------------------------------------------- Creditors owed money by KEG Zoric Trockenbau (FN 262789f) are encouraged to attend the creditors' meeting at 11:20 a.m. on July 26 to consider the adoption of the rule by revision and accountability. The creditors' meeting will be held at: The Land Court of Leoben Hall No. IV 1st Floor Leoben, Austria Headquartered in Proleb, Austria, the Debtor declared bankruptcy on June 1 (Bankr. Case 17 S 42/06d). Reinhard Teubl serves as the court-appointed property manager of the bankrupt estate. The property manager can be reached at: Dr. Reinhard Teubl Mittergasse 28 8600 Bruck an der Mur, Austria Tel: 03862-51462 Fax: 03862-51462-10 =========== F R A N C E =========== ALSTOM SA: Inks EUR45-Million Tram Deal with Angers Loire --------------------------------------------------------- The French "Angers Loire Metropolitan Authority" has chosen Alstom S.A. for the supply of 17 CITADIS trams equipped with the innovative APS power supply system, which eliminates overhead power wires. The order includes a firm part for the design, a full-scale tram model and the supply of the APS system. An optional part provides for the supply of the 17 trams. The first part is to be signed before end July. The second part will be signed in June 2007 following the accreditation of the project. The two parts of the order represent a total of EUR45 million. Angers is the second city in the world, following Bordeaux, to opt for APS. On June 14, this year, at the Public Transport congress in Paris, ALSTOM was awarded the Innovation Trophy in the Energy/Environment section for this technology. The wireless APS allows tramways to blend harmoniously into the urban environment and will thus preserve the heritage of Angers and Avrille city-centers. The tramway will be put into service in 2009, linking Avrill� to the Roseraie district via the city center. The line will stretch over 12 km with 25 stops, serving 35,000 passengers per day. The trams will be designed and assembled in ALSTOM's La Rochelle factory -- the company's Centre of Excellence for trams. Four other ALSTOM sites in France will supply sub-systems: -- Tarbes the traction drives; -- Ornans the traction motors; -- Le Creusot the bogies; and -- Villeurbanne the tram electronics. Angers is the world's 24th city to have chosen CITADIS -- the 14th in France. This further confirms ALSTOM's success with this tramway product line and its leadership on the French tram market, where 80% of the steel-wheel trams are ALSTOM-built. To date, over 400 CITADIS are in commercial service worldwide out of a total of 800 CITADIS ordered. CITADIS trams have carried over 1 billion passengers and have demonstrated reliability over a total distance of 76 million kilometers. About Alstom Headquartered in Paris, France, Alstom S.A. -- http://www.alstom.com/-- is a leading maker of power-generation systems and constructs power plants, rail equipment, luxury passenger ships, naval vessels, and natural gas tankers. It also produces electrical drives, motors, and generators. The group generates EUR13 billion in annual revenues and employs more than 70,000 people worldwide. For the fiscal year ended March 31, 2006, Alstom posted EUR178 million in net profit on EUR13.4 billion in net sales, compared to EUR628 million in net loss on EUR12.9 billion in net sales a year ago. As of March 31, 2006, Alstom had EUR18.408 billion in total assets, EUR16.568 billion in total liabilities and EUR1.84 billion in total equity. As of March 31, 2006, Alstom had EUR8.785 billion in current assets and EUR11.802 billion in current liabilities. FIXED LINK: Moody's Cuts Rating on GBP620-Mln Notes to B2 --------------------------------------------------------- Moody's Investors Service downgraded the GBP120 million 8.15% Class A Notes due 2026 and the Underlying Rating of the GBP620 million 5.78% Guaranteed Notes due 2028 of Fixed Link Finance 2 B.V. (FLF2) to B2 from B1. The ratings remain on review with direction uncertain. The review was initiated on June 5, following the announcement by the Eurotunnel PLC/S.A. group that it had signed a binding preliminary restructuring agreement with a committee representing certain of its creditors. The Aaa ratings of FLF2's GBP620 million Guaranteed Notes, which are based upon the unconditional and irrevocable guarantee of principal and interest by MBIA Assurance S.A., remain unchanged. The rating action has been prompted by the announcement that Eurotunnel has applied to the French courts to enter a process known as a 'procedure de sauvegarde', which is intended to give Eurotunnel relief from its creditors while it negotiates a debt restructuring plan with them. If granted, which Moody's considers likely, such procedure will permit Eurotunnel to cease payments to debt holders while the procedure is ongoing. The downgrade reflects Moody's view that the probability that the Un-guaranteed Debt will default is now very high, whereas previously Moody's had assumed that the execution of the Capital Restructuring Plan, or a variation thereon, could be completed in time to avoid a payment default on the Un-guaranteed Debt. Nevertheless, the B2 rating factors Moody's assumption that the recovery of unguaranteed Debt outstanding will be 100% or very close to 100%. FLF2 is a special purpose company that has lent the proceeds of the notes it has issued to Eurotunnel in the form of Tier 1A Loans. All Eurotunnel debt holders benefit from a security interest over the assets of those French and U.K. companies that make up the Eurotunnel group that it is possible to secure on a fully cross-collateralized basis. In addition, the Eurotunnel debt holders have the benefit of "rights of substitution', i.e. the right to take over the Concession owned by Eurotunnel through new companies held for the benefit of Eurotunnel debt holders. The rating has been maintained on review with direction uncertain, reflecting Moody's understanding that the Capital Restructuring Plan or a variation thereon may be agreed by Eurotunnel and its creditors, which would result in the Un- guaranteed Debt remaining whole and in place with a credit profile higher than B2, but also the possibility that restructuring negotiations may not be successful and the consequent uncertainties that this would create. From the perspective of a possible upgrade, Moody's review of the Un-guaranteed Debt will continue to focus on: -- likely developments in Eurotunnel's operating performance over the coming few years; and -- the key terms of the Capital Restructuring Plan or v ariations thereon, many critical features of which are as yet unknown or still developing. From the perspective of a possible further downgrade, Moody's will continue to assess: -- the likelihood that the Capital Restructuring Plan or broadly equivalent plan will not be completed and the consequence of such a development, i.e. the subsequent insolvency of Eurotunnel; and -- the risk that consequent substitution by Eurotunnel creditors will not operate completely in accordance with lan. While the terms of the Capital Restructuring Plan or successor debt restructuring plan may change from those previously envisaged following further negotiations between Eurotunnel and its creditors, Moody's does not believe that such terms would likely change to the extent that there will be impairment of the Tier 1A Loans. Furthermore, if there is no agreement between Eurotunnel and its debt holders, Moody's considers it likely that the process of substitution will be effective and will ensure an ultimate recovery of all Un-guaranteed Debt within a few years. Nevertheless, the procedure of substitution is untested, which creates some uncertainties as to the process, timing and success of execution. Eurotunnel's rationale for seeking protection through a 'procedure de sauvegarde' is somewhat unclear, in Moody's view, given that negotiations with creditors were continuing in earnest. Such negotiations will need to continue during the procedure. However, Moody's expects that the procedure will force the parties to reach an agreement within the next few months, failing which a substitution is likely. Therefore, the initiation of the procedure may well have reduced all parties' room to accommodate any unexpected events. The Capital Restructuring Plan envisages: -- the continuation of the FLF2 debt and the related Tier 1A Loans, -- the repayment of Eurotunnel's Tier 1 Loans and Tier 2 Loans, and -- a partial repayment of Eurotunnel's Tier 3 Loans, together with an exchange of the un-redeemed Tier 3 Loans for an equity-like debt instrument with a cash alternative. However, critical elements of the Capital Restructuring Plan remain uncertain, including the maturity and financial terms of each class of new Eurotunnel debt that will be created as part of the Capital Restructuring Plan, and the inter-creditor arrangements that will need to be implemented to regulate the rights of all debt holders versus each other and Eurotunnel. Ratings outstanding: -- GBP620 million 5.78% Guaranteed Notes due 2028: Aaa; -- underlying Rating of the above: B2, review direction uncertain; and -- GBP120 million 8.15% Class A Notes due 2026: B2, review direction uncertain. Fixed-Link Finance 2 B.V. is a special purpose company incorporated in the Netherlands solely for the purpose of issuing the Class A Notes and Guaranteed Notes and lending the proceeds to members of the Eurotunnel PLC and Eurotunnel S.A. group. The Eurotunnel PLC and Eurotunnel S.A. group manages the infrastructure of the Channel Tunnel and operates passenger shuttle and truck shuttle services between Folkestone in the U.K. and Coquelles in France. * Moody's Notes Filing's Effect on Eurotunnel's Guarantors ---------------------------------------------------------- Moody's Investors Service commented on the limited effect of a possible bankruptcy of Eurotunnel on the credit profile of the financial guaranty insurance companies with exposure to the firm, despite some substantial exposures to the tunnel operator. The insurance financial strength ratings and outlooks the guarantors are unlikely to be negatively affected by a Eurotunnel bankruptcy given our current expectations for limited ultimate losses on their guarantees, coupled with their strong liquidity positions should there be claims in the event of a bankruptcy-related debt service moratorium. Eurotunnel, is a group of companies owned by Eurotunnel PLC of the U.K. and Eurotunnel S.A. of France, with a concession to operate and maintain two railway tunnels and a service tunnel between the southeast coast of England and the northeast coast of France, and to collect tolls for the provision of cross channel rail services until 2086. Eurotunnel has had financial problems from its inception with significant construction cost overruns and lower traffic than projected. Management and its senior creditors recently agreed to a restructuring plan, although it met strong opposition from junior creditors who proposed an alternative plan. As no consensus was reached between the two creditor groups and Eurotunnel's management, the firm made a request for bankruptcy proceedings, "procedure de sauvegarde," under French law. A ruling is expected before the end of July 2006, possibly leaving creditors some time to reassess their positions. Eurotunnel indicated that it could withdraw its request if a consensus is reached for a restructuring plan. The guarantors wrap approximately US$2.2 billion of Eurotunnel's total debt of GBP6.2 billion (US$11.3 billion). MBIA is the guarantor with the most substantial exposure at US$1.37 billion net of reinsurance (US$1.97 billion, gross), followed by Ambac at US$349 million, Assured Guaranty at US$198 million, and RAM Re at US$63 million. Moody's commented that the guarantors' exposures are quite senior in Eurotunnel's debt structure and that, even under conservative stress scenarios, ultimate losses for the guarantors would likely be a small fraction of their exposure, should they occur at all. Any such losses should be manageable given the guarantors' significant financial resources and capital positions. The rating agency added that a possible bankruptcy of Eurotunnel raises the potential for a debt service moratorium by the firm, exposing the guarantors to potential claims payments until the ultimate occurrence of a debt restructuring. The guarantors have ample liquidity to pay such possible claims and, in some instances, benefit from dedicated reserves or lines of credit to meet debt service requirements. Moody's recognizes that the situation is evolving and will continue to monitor events as they unfold. The rating agency intends to publish a brief Special Comment that will provide more detail about its current assessment of risks presented by Eurotunnel to the guarantors. * Fitch Says Eurotunnel Won't Affect Guarantors' Ratings -------------------------------------------------------- Fitch Ratings has been monitoring the developments of Eurotunnel Group for the past several years, given several financial guarantors' sizeable exposure to this high-profile credit, led by MBIA Insurance Corp. Given the financial debt burden and marginal financial performance of Eurotunnel, there had been a distinct possibility that Eurotunnel's management would file for insolvency protection at some juncture. On July 12, the company's management said it would be pursuing legal proceedings to place itself under the protection of the Commercial Court of Paris pursuant to the Frencch law 'procedure de sauvegarde'. Depending upon the ruling of the court, it is possible that there could be a suspension of debt service payments by Eurotunnel in the near term. Insured Eurotunnel Exposure*/(US$ Mil)/Gross Par/Net Par -- MBIA Insurance Corp. 1,960.5 /1,394.4; -- Ambac Assurance Corp. 349.8 / 349.8; -- Assured Guaranty Ltd. 198.3 / 198.3; Total 2,508.6 / 1,942.5 Despite the size of the exposure to Eurotunnel, Fitch does not foresee any changes to the insurer financial strength ratings of the companies exposed to this credit, as the potential downside scenarios of this troubled credit have been fully considered in the rating process. Fitch is comforted by the relative position the financial guarantors maintain in Eurotunnel's capital structure. The financial guarantors have no exposure to debt of Eurotunnel below Tier 3, and the financial guarantors' only exposure to Tier 3 debt is indirectly via the collateral debt portfolio of Fixed-Link Finance B.V. Actually about US$1.7 billion of the above US$1.9 billion net par exposure represents exposure to obligations of FLF1 and Fixed-Link Finance 2 B.V. Both FLF1 and FLF2 are special purpose vehicles that hold debt issued by Eurotunnel. The FLF1 vehicle holds a mix of Tier 1, 2 and 3 Eurotunnel debt, and FLF2 holds only Tier 1A debt -- which ranks pari passu in seniority with Tier 1. The FLF1 financing structure contains a liquidity facility that will cushion the financial guarantors from incurring debt service claims on FLF1's insured debt for a period of time following any interruption of debt service payments by Eurotunnel. On the other hand, the FLF2 vehicle does not maintain a third-party liquidity facility, which is expected to result in sizeable liquidity claims for the affected financial guarantors upon cessation of debt service payments by Eurotunnel. Because the financial guarantors' exposure is relatively senior, and because of the central role the financial guarantors have in the restructuring negotiations, Fitch does not currently expect either interim developments or ultimate resolution of this Eurotunnel restructuring to have a material adverse impact on the financial condition of the affected financial guarantors, despite the sizeable amount of net par exposure. That said, given the recent filing, liquidity claims have become an increased possibility, particularly on non-FLF1 exposures, however a very high rate of recovery of these claims is ultimately anticipated down the line. Given the various constituencies involved in Eurotunnel's credit, Fitch believes the restructuring process could become protracted and remain contentious and, if this is the case, resolution of this exposure will likely require further significant management time and resources on the part of the financial guarantors, particularly MBIA. Any deterioration in Eurotunnel's financial operation during the restructuring process would be expected to negatively impact the final resolution of the exposures that have been insured. ============= G E O R G I A ============= METROMEDIA INTERNATIONAL: Reporting Preliminary Results Soon ------------------------------------------------------------ Metromedia International Group, Inc. (PINK SHEETS: MTRM -- Common Stock, MTRMP -- Preferred Stock), revealed that although it has not fully completed the previously disclosed restatement activities required for the Company to file its Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2004, the Company intends to release preliminary financial results, through Dec. 31, 2005, for its principal Georgian business, Magticom, within the next 30 days. Ernie Pyle, the Company's Chief Financial Officer, said: "Although the financial information that will be released will be subject to adjustment until such time that the Company files its respective periodic reports with the United States Securities and Exchange Commission (Form 10-Q's and Form 10-K), we are encouraged that we can deliver to our shareholders more recent financial performance of our principal Georgian business." Mr. Pyle further stated, "With respect to the Company's periodic reports that are to be filed with the SEC, we believe that we have substantially completed the work effort associated with the restatement of the Company's financial statements prior to fiscal year 2004 as well as completed the preparation of financial statements and disclosures for fiscal year 2004. Accordingly, management has begun to focus attention on the Company's fiscal year 2005 periodic reporting obligations with the SEC, while continuing to resolve disclosure issues, as they have arisen or may arise, associated with the review process for the 2004 Form 10-K." About Metromedia International Headquartered in Charlotte, North Carolina, Metromedia International Group -- http://www.metromedia-group.com/-- through its subsidiary, Metromedia International Telecommunications, owns interests in telecom and cable TV operations in Russia, Georgia, and elsewhere in Eastern Europe. Since the first quarter of 2003, the Company has focused its principal attentions on the continued development of its core telephony businesses, and has substantially completed a program of gradual divestiture of its non-core cable television and radio broadcast businesses. The Company's core businesses includes Magticom, Ltd., the leading mobile telephony operator in Tbilisi, Georgia, and Telecom Georgia, a well-positioned Georgian long distance telephony operator. * * * Moody's Investors Service has placed Metromedia's subordinated debt rating at B3 and junior subordinated debt rating at B2. ============= G E R M A N Y ============= ABACOM VERMOGENS: Claims Registration Ends July 25 -------------------------------------------------- Creditors of ABACOM Vermogens- und Beteiligungs GmbH have until July 25 to register their claims with court-appointed provisional administrator Christian Frystatzki. Creditors and other interested parties are encouraged to attend the meeting at 9:00 a.m. on Sept. 1, at which time the administrator will present his first report on the insolvency proceedings. The meeting of creditors will be held at: The District Court of Bonn Hall S 2.22 2. Stick William Route 21 53111 Bonn, Germany The Court will also verify the claims set out in the administrator's report during this meeting, while creditors may constitute a creditors' committee or opt to appoint a new insolvency manager. The District Court of Bonn opened bankruptcy proceedings against ABACOM Vermogens- und Beteiligungs GmbH on June 16. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be contacted at: ABACOM Vermogens- und Beteiligungs GmbH Attn: Martin Ehrenberg, Manager Vogtsgasse 39 A 53639 Konigswinter, Germany The administrator can be contacted at: Dr. Christian Frystatzki Sankt Augustiner Road 94 a 53225 Bonn, Germany Tel: 0228/4009 40 Fax: 0228/4009 479 ALB AUTOLEASING: Claims Registration Ends August 10 --------------------------------------------------- Creditors of ALB AutoLeasing Brau GmbH have until Aug. 10 to register their claims with court-appointed provisional administrator Steffen Koch. Creditors and other interested parties are encouraged to attend the meeting at 3:15 p.m. on Aug. 31, at which time the administrator will present his first report on the insolvency proceedings. The meeting of creditors will be held at: The District Court of Oldenburg Meeting Room 2nd Floor Elizabeth Route 6 26135 Oldenburg, Germany The Court will also verify the claims set out in the administrator's report during this meeting, while creditors may constitute a creditors' committee or opt to appoint a new insolvency manager. The District Court of Oldenburg opened bankruptcy proceedings against ALB AutoLeasing Brau GmbH on June 15. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be contacted at: ALB AutoLeasing Brau GmbH Hackenweg 4 26127 Oldenburg, Germany Attn: Stephan Paruk, Manager Woehler Road 24 31174 Schellerten, Germany Sven Jessen, Manager Rostocker Road 13 26127 Oldenburg, Germany The administrator can be contacted at: Dr. Steffen Koch King Route 26 30175 Hanover, Germany Tel: 0511/5248523 Fax: 0511/5422944 ALLGEMEINE HYPOTHEKENBANK: Fitch Keeps C/RR6 on Deferred Payment ---------------------------------------------------------------- Fitch Ratings disclosed that Germany-based Allgemeine Hypothekenbank Rheinboden's non-payment of interest on the participation rights is in line with documentation and has already been factored into Fitch's rating actions on April 27. On April 27, Fitch downgraded AHBR's participation rights maturing in December 2005 through to December 2008 to C/RR6 on the Recovery Rating scale, following the publication of its 2005 losses. Genussscheine maturing after December 2008 were affirmed at CC/RR5. The downgrade on the Genussscheine maturing in December 2005 through to December 2008 reflects Fitch's opinion that investors are likely to only achieve a poor recovery while the recovery prospects of the Genussscheine maturing after December 2008 are below average. AHBR reported an annual loss of around EUR1.1 billion, due to the crystallization of losses on interest rate positions and further impairment charges in the loan book. As a result, the bank created negative distributable reserves (Bilanzverlust) and deferred the coupon on the profit participation rights. The Bilanzverlust has been shared across the various capital classes, resulting in a write-down of the face value of the profit participation rights. The bank's ratings are: -- Issuer Default rating: BBB- on Rating Watch Negative; -- Short-term rating: F3 on RWN; -- Support rating: 2 on RWN; -- Senior unsecured obligations: BBB- on RWN; -- Subordinated obligations: BB+ on RWN; -- Individual rating: D/E on Rating Watch Positive; -- Participation rights maturing in December 2005 through to December 2008: C/RR6; -- Participation rights maturing after December 2008: CC/RR5; -- Outstanding public sector Pfandbriefe: AAA; and -- Outstanding mortgage Pfandbriefe: AA+ on RWN. ASAT HOLDINGS: April 30 Equity Deficit Tops US$53.2 Million ----------------------------------------------------------- ASAT Holdings Limited reports its financial results for the fourth quarter and fiscal year ended April 30, 2006. Net revenue in the fourth quarter of fiscal 2006 was US$49.3 million, an increase of 2% compared with net revenue of US$48.2 million in the third quarter of fiscal 2006. Net loss in the fourth quarter of fiscal 2006 was US$17.1 million. Fourth quarter net loss includes one-time related charges of US$3.9 million for the write-off of property, plant and equipment, US$2.7 million in reorganization charges, and US$1.0 million in relocation and facilities expenses associated with the Company's move of its manufacturing operations to Dongguan, China. Fourth-quarter net loss compares with a third quarter net loss of US$5.9 million. Third quarter net loss included a US$2.3 million reversal to other income for the previously accrued write-off of ASAT S.A., ASAT's business in France that was closed as part of ASAT's global restructuring in November 2001. "We have successfully closed our assembly and test operations in Hong Kong and are completing our move to Dongguan, China," Robert J. Gange, president and chief executive officer of ASAT Holdings Limited said. "The move was completed ahead of schedule with minimal disruption to our overall business. Now that our manufacturing is in the new low-cost facility, we expect the cost savings by operating in Dongguan will be reflected in the October quarter results." Fiscal 2006 Financial Results Net revenue for fiscal 2006 was US$182.1 million, compared with net revenue of US$194.4 million in fiscal 2005. Net loss for fiscal 2006 was US$42.4 million. This compares with a net loss of US$60.4 million in fiscal 2005. At April 30, 2006, the Company's balance sheet showed US$181,461,000 in total assets, US$230,575,000 in total liabilities and US$4,143,000 in total redeemable convertible preferred shares, resulting in a US$53,257,000 shareholders' deficit. The Company also has a US$306,152,000 accumulated deficit at April 30, 2006. Financing Commitment The Company is in the process of obtaining external financing to facilitate its required working capital needs. While ASAT believes receipt of the financing is likely, there can be no assurance that it will be obtained, and if such financing is not obtained for any reason, unless alternate financing is obtained, there may be questions regarding the Company's ability to continue as a going concern. First Quarter Fiscal 2007 Outlook and Guidance "The July quarter will mark the end of our move to China," Mr. Gange said. "During the last stage of the move some of our equipment was not available for production. Since we were not able to maximize our full revenue generating potential our July quarter revenue results will be in line with the April quarter." For the first quarter of fiscal 2007, ending July 31, 2006, the Company expects revenue to be approximately flat with the April quarter. ASAT Holdings Limited ASAT Holdings Limited (Nasdaq: ASTT) -- http://www.asat.com/-- is a global provider of semiconductor package design, assembly and test services. With more than 17 years of experience, the Company offers a definitive selection of semiconductor packages and world-class manufacturing lines. ASAT's advanced package portfolio includes standard and high thermal performance ball grid arrays, leadless plastic chip carriers, thin array plastic packages, system-in-package and flip chip. ASAT was the first company to develop moisture sensitive level one capability on standard leaded products. The Company has operations in the United States, Asia and Europe. ASAT, Inc. is a wholly owned subsidiary of ASAT Holdings Limited and the exclusive representative of ASAT for services in North America. * * * As reported in the Troubled Company Reporter on Nov. 10, 2005, Standard & Poor's Ratings Services has affirmed ASAT Holdings Ltd.'s 'B-' long-term corporate credit rating and removed the rating from CreditWatch, where it was placed with negative implications on Aug. 17, 2005. S&P said the outlook is negative. Moody's also placed a Caa1 rating on ASAT Holdings' senior unsecured debt on March 26, 2004. BELOW HAUSTECHNIK: Claims Registration Ends August 1 ---------------------------------------------------- Creditors of Below Haustechnik GmbH have until Aug. 1 to register their claims with court-appointed provisional administrator Andreas Stratenwerth. Creditors and other interested parties are encouraged to attend the meeting at 9:45 a.m. on Aug. 22, at which time the administrator will present his first report on the insolvency proceedings. The meeting of creditors will be held at: The District Court of Bielefeld Hall 4065 4 Ebene Court Route 6 33602 Bielefeld, Germany The Court will also verify the claims set out in the administrator's report during this meeting, while creditors may constitute a creditors' committee or opt to appoint a new insolvency manager. The District Court of Bielefeld opened bankruptcy proceedings against Below Haustechnik GmbH on June 22. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be contacted at: Below Haustechnik GmbH Artur-Ladebeck-Str. 85 33617 Bielefeld, Germany Attn: Hans-Wilhelm Homringhausen, Manager Horstkotterheide 47 33739 Bielefeld, Germany The administrator can be contacted at: Andreas Stratenwerth Lemgoer Str. 4 33604 Bielefeld, Germany FARBE CREATIV: Claims Registration Ends August 11 ------------------------------------------------- Creditors of Farbe Creativ GmbH have until Aug. 11 to register their claims with court-appointed provisional administrator Michael Bremen. Creditors and other interested parties are encouraged to attend the meeting at 9:00 a.m. on Sept. 1, at which time the administrator will present his first report on the insolvency proceedings. The meeting of creditors will be held at: The District Court of Duesseldorf Area A 341 3rd Floor Muehlenstrasse 34 40213 Duesseldorf, Germany The Court will also verify the claims set out in the administrator's report during this meeting, while creditors may constitute a creditors' committee or opt to appoint a new insolvency manager. The District Court of Duesseldorf opened bankruptcy proceedings against Farbe Creativ GmbH on June 21. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be contacted at: Farbe Creativ GmbH Attn: Ingrid Haase, Manager Niederrheinstr. 237 40474 Duesseldorf, Germany The administrator can be contacted at: Michael Bremen Sternstr. 58 40479 D�sseldorf, Germany KIESA KIES: Claims Registration Ends August 1 --------------------------------------------- Creditors of Kiesa Kies- und Sandwerke GmbH have until Aug. 1 to register their claims with court-appointed provisional administrator Jorg Nerlich. Creditors and other interested parties are encouraged to attend the meeting at 11:00 a.m. on Aug. 10, at which time the administrator will present his first report on the insolvency proceedings. The meeting of creditors will be held at: The District Court of Bonn Area Room W 1.24A. 1. Stick William Route 21 53111 Bonn, Germany The Court will also verify the claims set out in the administrator's report during this meeting, while creditors may constitute a creditors' committee or opt to appoint a new insolvency manager. The District Court of Bonn opened bankruptcy proceedings against Kiesa Kies- und Sandwerke GmbH on June 26. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be contacted at: Kiesa Kies- und Sandwerke GmbH Attn: Edith Kuttenkeuler, Manager Boedinger Str. 11 53773 Hennef, Germany The administrator can be contacted at: Dr. Jorg Nerlich Sternstr. 79 53111 Bonn, Germany Tel: 0228/94 59 820 Fax: 0228/94 59 829 LOTEXTIL GMBH: Claims Registration Ends July 19 ----------------------------------------------- Creditors of Lotextil GmbH have until July 19 to register their claims with court-appointed provisional administrator Sylvia Rhein. Creditors and other interested parties are encouraged to attend the meeting at 10:30 a.m. on Aug. 30, at which time the administrator will present her first report on the insolvency proceedings. The meeting of creditors will be held at: The District Court of Darmstadt Room 4.310 4th Floor Building D Mathildenplatz 15 64283 Darmstadt, Germany The Court will also verify the claims set out in the administrator's report during this meeting, while creditors may constitute a creditors' committee or opt to appoint a new insolvency manager. The District Court of Darmstadt opened bankruptcy proceedings against Lotextil GmbH on June 13. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be contacted at: Lotextil GmbH Attn: Lothar Geissler, Manager Zieglerstr. 1 64319 Pfungstadt, Germany The administrator can be contacted at: Sylvia Rhein Walter-Rathenau-Str. 24 64646 Heppenheim, Germany Tel: 06252/6877-0 Fax: 06252/6877-11 OCH TRANSPORT: Creditors' Meeting Slated for July 28 ---------------------------------------------------- Creditors of Och Transport GmbH have until July 28 to register their claims with court-appointed provisional administrator Thomas Linse. Creditors and other interested parties are encouraged to attend the meeting at 8:30 a.m. on Aug. 18, at which time the administrator will present his first report on the insolvency proceedings. The meeting of creditors will be held at: The District Court of Bamberg Meeting Room 031 Synagog Place 1 96047 Bamberg, Germany The Court will also verify the claims set out in the administrator's report during this meeting, while creditors may constitute a creditors' committee or opt to appoint a new insolvency manager. The District Court of Bamberg opened bankruptcy proceedings against Och Transport GmbH on June 22. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be contacted at: Och Transport GmbH Attn: Ernst Georg Och, Manager Gartenstr. 4 96126 Maroldsweisach/Ditterswind, Germany The administrator can be contacted at: Thomas Linse Rosenauer Str. 22 96450 Coburg, Germany Tel: 09561/8034-0 Fax: 09561/8034-34 SUNNY ISLAND: Claims Registration Ends August 9 ----------------------------------------------- Creditors of Sunny Island GmbH have until Aug. 9 to register their claims with court-appointed provisional administrator Sylvia Hofmann. Creditors and other interested parties are encouraged to attend the meeting at 9:00 a.m. on Sept. 20, at which time the administrator will present her first report on the insolvency proceedings. The meeting of creditors will be held at: The District Court of Darmstadt Hall 14 1st Floor Building D Mathildenplatz 15 64283 Darmstadt, Germany The Court will also verify the claims set out in the administrator's report during this meeting, while creditors may constitute a creditors' committee or opt to appoint a new insolvency manager. The District Court of Darmstadt opened bankruptcy proceedings against Sunny Island GmbH on June 14. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be contacted at: Sunny Island GmbH Attn: Margret Lange, Manager Schulstrasse 18 64283 Darmstadt, Germany The administrator can be contacted at: Sylvia Hofmann Birkenweg 24 64295 Darmstadt, Germany Tel: 06151/66729-0 Fax: 06151/66729-20 E-mail: darmstadt@ltb-anwaelte.de TRANSMONT GMBH: Claims Registration Ends August 10 -------------------------------------------------- Creditors of Transmont GmbH have until Aug. 10 to register their claims with court-appointed provisional administrator Joachim Walterscheid. Creditors and other interested parties are encouraged to attend the meeting at 9:00 a.m. on Aug. 31, at which time the administrator will present his first report on the insolvency proceedings. The meeting of creditors will be held at: The District Court of Bielefeld Hall 4065 4 Ebene Court Route 6 33602 Bielefeld, Germany The Court will also verify the claims set out in the administrator's report during this meeting, while creditors may constitute a creditors' committee or opt to appoint a new insolvency manager. The District Court of Bielefeld opened bankruptcy proceedings against Transmont GmbH on June 14. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be contacted at: Transmont GmbH Attn: Klaus Susa, Manager Besebrucher Str. 64 32549 Bad Oeynhausen, Germany The administrator can be contacted at: Joachim Walterscheid Kurpark 2 32545 Bad Oeynhausen, Germany UDOPEA GESCHAFTSFUEHRUNGS: Creditors' Meeting Slated for July 27 ---------------------------------------------------------------- The court-appointed provisional administrator for Udopea Geschaftsfuehrungs GmbH, Stefanie Luethje, will present her first report on the Company's insolvency proceedings at a creditors' meeting at 11:50 a.m. on July 27. The meeting of creditors and other interested parties will be held at: The District Court of Bremen Hall 115 Court House (New Building) Ostertorstr. 25-31 28195 Bremen, Germany The Court will also verify the claims set out in the administrator's report at 10:50 a.m. on Sept. 28 at the same venue. Creditors have until Sept. 3 to register their claims with the court-appointed provisional administrator. The District Court of Bremen opened bankruptcy proceedings against Udopea Geschaftsfuehrungs GmbH on June 19. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be reached at: Udopea Geschaftsfuehrungs GmbH Insterburger Str. 9a 28207 Bremen, Germany Attn: Marko Mario Bohm, Manager Finkenweg 15 28832 Achim, Germany The administrator can be reached at: Stefanie Luethje Ostertorsteinweg 74/75 28203 Bremen, Germany Tel: 792570 Fax: 7925757 Web: http://www.oelb.de/ E-mail: Luethje@oelb.de VOLKSWAGEN AG: Cutting Jobs in Brazilian Plants ----------------------------------------------- German automaker Volkswagen AG has scheduled 4,000 to 6,000 job layoffs in its Brazilian plants through 2008. Bloomberg News says that the firing of workers may begin as early as this week as Volkswagen seeks to cut costs by decreasing labor costs. Volkswagen has five factories in Brazil with approximately 21,000 workers. The Taubate plant in Sao Paulo will be the first to get hit with layoffs once labor talks fail, Milton Junior, labor relations manager for the company's Brazilian unit told Bloomberg. The plant, which makes Parati and Golf cars, employs 4,500 people. A union representative told Bloomberg that Volkswagen plans to fire 160 workers at Taubate. Volkswagen is losing money in Brazil as the currency gained 61% forcing the company to raise prices which resulted to losses in export profits. According to the Xinhua news agency, Volkswagen is lobbying, along with other exporters, for an exchange rate between 2.60 to 2.70 reals for US$1. The U.S. dollar's value dropped to 2.10 reals recently. The company's restructuring plan will result to a decrease in production to 514,000 in 2008, while annual exports will be cut to 100,000, Xinhua states. Volkswagen will also cut jobs at its plants in Sao Bernardo do Campo and Sao Jose dos Pinhais. Headquartered in Wolfsburg, Germany, the Volkswagen Group -- http://www.volkswagen.de/-- is one of the world's leading automobile manufacturers and the largest carmaker in Europe. With 47 production plants in eleven European countries and a further seven countries in the Americas, Asia and Africa, Volkswagen has more than 343,000 employees producing over 21,500 vehicles or are involved in vehicle-related services on every working day. * * * Volkswagen has been carrying out measures to cut costs and raise profits, which could affect up to 30,000 jobs. The potential job cuts represent about a third of the carmaker's workforce and three times higher than initial estimates made by Chief Executive Bernd Pischetsrieder and Volkswagen brand head, Wolfgang Bernhard. In November, Volkswagen maintained its 2005 earnings guidance amid rumors it may lower targets. The company predicts a year- on-year improvement in both operating profit after special items and profit before tax this year. Rumors flew that the company would slash full-year earnings forecast due to higher restructuring costs. The company said the impact of its workforce reduction measures, which will be charged as special items in the fourth quarter, will be lower than last year's. The company also admitted there were no significant improvements in the economic environment in the first nine months of 2005, and the overall situation in the important automotive markets remained difficult. It also expected tougher competition in the Chinese and U.S. markets, and the rise in fuel prices to influence consumer confidence. ============= I R E L A N D ============= PULS CDO: Moody's Rates Class E Notes at (P)Ba3 ----------------------------------------------- Moody's Investors Service assigned these provisional ratings in respect of the notes to be issued by Puls CDO 2006-1 PLC: -- Class A Senior Floating Rate Notes due 2014: (P)Aaa; -- Class B Senior Floating Rate Notes due 2014: (P)Aa2; -- Class C1 Senior Floating Rate Notes due 2014: (P)A2; -- Class C2 Senior Floating Rate Notes due 2014: (P)A3; -- Class D Subordinated Deferrable Floating Rate Notes due 2014: (P)Baa3; -- Class E1 Subordinated Deferrable Floating Rate Notes due 2014: (P)Ba3; and -- Class E2 Subordinated Deferrable Floating Rate Notes due 2014: (P)Ba3. The Class E1 and Class E2 Notes are ranking pari passu. The ratings address the expected loss posed to investors by the legal final maturity in July 2014. This is a securitization of senior unsecured and subordinated bonds arranged by Merrill Lynch International. The borrowers under such instruments are German and Swiss small to medium sized companies. PULS, the issuer, incorporated in Ireland, will issue seven classes of rated Notes: Class A, Class B, Class C1, Class C2, Class D, Class E1 and Class E2 Notes. Except for the Class E2 Notes, the Notes have semi-annual interest payment dates and will pay a margin over 6 months EURIBOR. The interest rate mismatch between fixed rate portfolio assets and floating rate liabilities will be hedged using interest rate swaps. Up to 5% of the portfolio may be invested into CHF denominated bonds. The potential foreign exchange risk with respect to the EUR denominated Notes is almost completely mitigated by the implementation of a FX Macro Hedge structure. All classes are expected to mature on the date falling approximately seven years after the issue date. In case not all Notes are redeemed in full on the expected maturity, the maturity of the Notes will extend until the legal maturity in July 2014. The portfolio will be ramped-up over the 180-day period following the Closing Date. Afterwards, the portfolio remains static. The issuer is anticipated to make advances to 40-45 companies in a total amount of EUR260 m. It is noteworthy that the subordinated bonds are deeply subordinated in a potential insolvency proceeding. Furthermore, none of bonds is secured with any kind of collateral. Hence substantially lower expected recovery rate than applicable to typical SME loans should occur. Contrary to more conventional SME loan securitizations, this transaction does not involve a third party originator. The companies were pre-selected by Capital Securities Group AG, acting as Portfolio Manager, based on estimated default frequencies provided by the German Moody's KMV RiskCalc model and on-site due diligences. Moody's issues provisional ratings in advance of the final sale of securities, but these ratings only represent Moody's preliminary credit opinions. Upon a conclusive review of the transaction and associated documentation, Moody's will endeavor to assign definitive ratings to the Notes. A definitive rating may differ from a provisional rating. =================== K A Z A K H S T A N =================== ALFA BANK: Moody's Changes Ba3 Deposit Rating Outlook to Stable --------------------------------------------------------------- Moody's Investors Service changed the outlook on the Ba3 long- term foreign-currency deposit rating of Alfa Bank Kazakhstan to stable from positive. The outlook on the bank's E+ financial strength rating and the Not Prime short-term deposit ratings remains stable. The rating agency notes that the outlook change reflects the recent change in outlook to stable from positive on the Ba2 long-term deposit rating of the bank's parent company, Alfa-Bank (Russia). Alfa Bank Kazakhstan is a wholly owned subsidiary of Alfa-Bank (Russia) and benefits from ongoing technical assistance from its parent. Moody's regards the likelihood of support from the Russian parent to the Kazakh entity in case of need as very high, underpinning the linkage between the outlooks on both institutions' deposit ratings. Alfa Bank Kazakhstan is headquartered in Almaty, Kazakhstan. The bank reported total consolidated assets of US$123 million under IFRS as of 31 Dec. 31, 2005. Outlook Actions: Issuer: Alfa-Bank Kazakhstan -- Outlook, Changed To Stable From Stable DVIGATEL: Creditors Must File Claims by Aug. 7 ---------------------------------------------- The Specialized Inter-Regional Economic Court of North Kazakhstan Region declared LLP Dvigatel insolvent on May 11. Subsequently, bankruptcy proceedings were introduced at the company. Creditors have until Aug. 7 to submit written proofs of claim to: The Specialized Inter-Regional Economic Court of North Kazakhstan Region Krasnoarmeiskaya Str. 286 Taiynsha, North Kazakhstan Region Kazakhstan KARAMALS: Creditors Must File Claims by Aug. 4 ---------------------------------------------- The Specialized Inter-Regional Economic Court of Karaganda Region declared LLP Karamals insolvent. Creditors have until Aug. 4 to submit written proofs of claim to: The Specialized Inter-Regional Economic Court of Karaganda Region Jambyl Str. 9 Karaganda, Karaganda Region Kazakhstan KAZZHELDORTRANS JSC: S&P Assigns BB+ Corp. Credit Rating -------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB+' long-term corporate credit rating, and its 'kzAA-' Kazakhstan national scale rating, to Kazakhstan-based railfreight rolling-stock lessor JSC Kazzheldortrans (KZDT), a 100% subsidiary of Kazakhstan Temir Zholy (KTZ), Kazakhstan national railway group. The outlook is stable. "The ratings on KZDT reflect the consolidated credit quality of KTZ," said Standard & Poor's credit analyst Eugene Korovin. "As a core subsidiary of KTZ, the former is closely integrated with the latter's freight operations, and receives the bulk of its revenues from KTZ." Further economic links between the two entities include: -- a cross-guarantee of most of the group's debt by KTZ and KZDT; -- cross-default provisions on most of group debt for debt exceeding US$25 million at KZDT; and -- the track record of parental support from KTZ to other group entities, as well as KTZ's commitment to provide extraordinary support for KZDT's debt. KZDT benefits from a significant share of the rolling-stock leasing market in Kazakhstan. The regulatory regime, however, although relatively supportive, lacks transparency and does not ensure full cost recovery for new rolling-stock purchases. KZDT's wagon fleet is aging and requires heavy medium-term investment. Although S&P expects capital repair and replacement to be financed internally, fleet additions could require additional borrowing. KZDT's financial risk is linked to that of the group. S&P expects KTZ's financial profile to weaken over the medium term, as planned investment will likely require additional borrowing. Intragroup lending covers KZDT's external funding needs. The company also guarantees all new major group borrowings that are guaranteed by KTZ and other large group subsidiaries. Standard & Poor's expects that KZDT will remain a subsidiary of KTZ, and continue to be closely integrated into group operations. Should the ratings on KTZ change, the ratings on KZDT would most likely be adjusted in line with the parent. "A material change in the parent-subsidiary relationship could challenge the current, consolidated group approach, and result in a heavier dependence by KZDT on its stand-alone credit quality," added Mr. Korovin. KVART: Creditors Must File Claims by Aug. 7 ------------------------------------------- The Specialized Inter-Regional Economic Court of Astana declared LLP Kvart insolvent. Subsequently, bankruptcy proceedings were introduced at the company. Creditors have until Aug. 7 to submit written proofs of claim to: The Specialized Inter-Regional Economic Court of Astana Valihanova Str. 71-68 Astana, Kazakhstan Tel: 8 (3172) 21-48-16 MAGAS: Proof of Claim Deadline Slated for Aug. 7 ------------------------------------------------ The Specialized Inter-Regional Economic Court of Akmola Region declared LLP Magas insolvent on May 15. Creditors have until Aug. 7 to submit written proofs of claim to: The Specialized Inter-Regional Economic Court of Akmola Region Room 228 Auelbekova Str. 139a Kokshetau, Akmola Region Kazakhstan Tel: 8 (3162) 25-79-32 MEGA: Proof of Claim Deadline Slated for Aug. 7 ----------------------------------------------- The Specialized Inter-Regional Economic Court of Akmola Region declared CJSC Mega insolvent on May 15. Creditors have until Aug. 7 to submit written proofs of claim to: The Specialized Inter-Regional Economic Court of Akmola Region Room 228 Auelbekova Str. 139a Kokshetau, Akmola Region Kazakhstan Tel: 8 (3162) 25-79-32 NORDPAK: Proof of Claim Deadline Slated for Aug. 7 -------------------------------------------------- The Specialized Inter-Regional Economic Court of North Kazakhstan Region declared LLP Nordpak insolvent on May 22. Subsequently, bankruptcy proceedings were introduced at the company. Creditors have until Aug. 7 to submit written proofs of claim to: The Specialized Inter-Regional Economic Court of North Kazakhstan Region Krasnoarmeiskaya Str. 286 Taiynsha North Kazakhstan Region Kazakhstan SENTRGAZ-SERVIS: Claims Registration Ends Aug. 7 ------------------------------------------------ The Specialized Inter-Regional Economic Court of East Kazakhstan Region declared LLP Sentrgaz-Servis insolvent on May 15. Subsequently, bankruptcy proceedings were introduced at the company. Creditors have until Aug. 7 to submit written proofs of claim to: The Specialized Inter-Regional Economic Court of East Kazakhstan Region Ushanova Str. 78-27 Ust-Kamenogorsk East Kazakhstan Region Kazakhstan Tel/Fax: 8 (3232) 26-24-41 SHAMSHAR: Claims Registration Ends Aug. 7 ----------------------------------------- The Specialized Inter-Regional Economic Court of Astana declared LLP Shamshar insolvent. Subsequently, bankruptcy proceedings were introduced at the company. Creditors have until Aug. 7 to submit written proofs of claim to: The Specialized Inter-Regional Economic Court of Astana Valihanova Str. 71-68 Astana, Kazakhstan Tel: 8 (3172) 21-48-16 TAMYZ FUDS: Claims Registration Ends Aug. 7 ------------------------------------------- The Specialized Inter-Regional Economic Court of Astana declared LLP Tamyz Fuds insolvent. Subsequently, bankruptcy proceedings were introduced at the company. Creditors have until Aug. 7 to submit written proofs of claim to: The Specialized Inter-Regional Economic Court of Astana Valihanova Str. 71-68 Astana, Kazakhstan Tel: 8 (3172) 21-48-16 TIMSA: Creditors' Claims Due Aug. 7 ----------------------------------- The Specialized Inter-Regional Economic Court of Akmola Region declared LLP Timsa insolvent on April 4. Creditors have until Aug. 7 to submit written proofs of claim to: The Specialized Inter-Regional Economic Court of Akmola Region Room 228 Auelbekova Str. 139a Kokshetau, Akmola Region Kazakhstan Tel: 8 (3162) 25-79-3 KSHT: Claims Registration Ends Aug. 7 ------------------------------------- The Specialized Inter-Regional Economic Court of East Kazakhstan Region declared insolvent LLP Trade House KSHT on May 15. Subsequently, bankruptcy proceedings were introduced at the company. Creditors have until Aug. 7 to submit written proofs of claim to: The Specialized Inter-Regional Economic Court of East Kazakhstan Region Ushanova Str. 78-27 Ust-Kamenogorsk East Kazakhstan Region Kazakhstan Tel/Fax: 8 (3232) 26-24-41 VEST-NAR: Creditors' Claims Due Aug. 4 -------------------------------------- The Specialized Inter-Regional Economic Court of Pavlodar Region declared LLP Vest-Nar insolvent on May 15. Subsequently, bankruptcy proceedings were introduced at the company. Creditors have until Aug. 4 to submit written proofs of claim to the insolvency manager at: The Specialized Inter-Regional Economic Court of Pavlodar Region Lunacharskogo Str. 49 Pavlodar Pavlodar Region Kazakhstan Tel: 8 (3182) 55-32-62 =================== K Y R G Y Z S T A N =================== POLITEKS: Creditors Must File Claims by Aug. 25 ----------------------------------------------- LLC Politeks has declared insolvency. Creditors have until Aug. 25 to submit written proofs of claim to: LLC Politeks Free Economic Zone Bishkek Kyrgyzstan Tel: (+996 312) 54-32-86 (0-543) 94-36-39 TOYOTA MOTORS: Proof of Claim Deadline Slated for Aug. 25 --------------------------------------------------------- LLC Toyota Motors Bishkek has declared insolvency. Creditors have until Aug. 25 to submit written proofs of claim to: LLC Toyota Motors Bishkek Asanalieva Str. 14 Bishkek, Kyrgyzstan Tel: (+996 312) 66-40-09 =========== N O R W A Y =========== FALCONBRIDGE LTD: Inco & Phelps Dodge Increase Merger Offer ----------------------------------------------------------- Phelps Dodge Corp., Inco Ltd. and Falconbridge Ltd. took action to improve the terms of their three-way combination. Phelps Dodge increased the cash portion of the consideration to be paid to the shareholders of Inco in the combination of Phelps Dodge and Inco by CDN$2.75 per Inco share. Inco increased the cash portion of its offer to purchase all outstanding common shares of Falconbridge by CDN$1.00 per Falconbridge share, and the Falconbridge board of directors has declared a special cash dividend of CDN$0.75 per Falconbridge common share. Improved Terms of 3-Way Combination Under the improved terms, Phelps Dodge will acquire all outstanding common shares of Inco for a combination of cash and common shares of Phelps Dodge having a value of CDN$80.70 per Inco share, based upon the closing price of Phelps Dodge stock and the closing U.S./Canadian dollar exchange rate on Friday, July 14. Shareholders of Inco will receive 0.672 shares of Phelps Dodge stock plus CDN$20.25 per share in cash for each share of Inco stock. This represents a premium of 7.8% to Inco's market price as of close of trading on July 14 and a premium of 23.7% to Inco's market price as of the close of trading on June 23, the last trading day before the announcement of the combination of Phelps Dodge, Inco and Falconbridge. Under its enhanced bid for Falconbridge, Inco is now offering CDN$18.50 plus 0.55676 shares of Inco for each share of Falconbridge, assuming full proration of the consideration. With the completion of both transactions, Falconbridge shareholders would receive an implied total consideration on a "look-through" basis of CDN$63.43 per Falconbridge common share, consisting of: (a) C$29.77 in cash; and (b) 0.3741 of a Phelps Dodge Inco Corp. common share (based on the closing price of the Phelps Dodge common shares on the New York Stock Exchange and applicable U.S. Federal Reserve U.S.-Canadian dollar exchange rates on July 14, 2006). Falconbridge Special Dividend In order to further increase the value received by Falconbridge shareholders, the board of Falconbridge declared a special cash dividend of CDN$0.75 per Falconbridge share payable on Aug. 10 to common shareholders of record at the close of business on July 26. The Falconbridge board also unanimously determined that Inco's amended offer for the shares of Falconbridge is superior to the unsolicited offer by Xstrata and unanimously recommends that Falconbridge shareholders accept the Inco offer. Reduction in Minimum Tender Condition In addition, Inco reduced the minimum condition in its offer for Falconbridge from two thirds of the outstanding shares of Falconbridge to 50.01% of outstanding shares on a fully diluted basis. Phelps Dodge and Inco also amended their Combination Agreement so that the combination of Phelps Dodge and Inco may be consummated before the acquisition by Inco of 100% of Falconbridge. Inco's amended offer for Falconbridge will expire on July 27. As part of the transaction, Phelps Dodge expects to repurchase up to US$5 billion of its shares in the 12 months after closing. "We strongly believe the combination of Phelps Dodge, Inco and Falconbridge represents a unique value-creation opportunity for the shareholders of all three companies," J. Steven Whisler, chairman and chief executive officer of Phelps Dodge, said. "There's no question that the value of the enhanced Inco offer for Falconbridge is superior to the unsolicited offer by Xstrata. In addition to the value inherent in the offer, the Falconbridge shareholders will have the ability to participate in the upside resulting from the three-way combination through their ownership of almost 30% of the combined company, which includes a 30% share in the US$900 million of expected annual synergies, which in total have a net present value of US$5.8 billion." "[The] actions demonstrate our shared commitment to create the leading North American-based mining company and a global powerhouse in copper and nickel," Scott Hand, chairman and chief executive officer of Inco, said. "That's great news for our shareholders, for our employees, for our communities and for Canada." "We are pleased with the actions taken by Phelps Dodge and Inco and by their affirmation of the value of Falconbridge," Derek Pannell, chief executive officer of Falconbridge, said. "The special dividend declared by our board further enhances the expected return to our shareholders. We are confident our shareholders will see the value in the combination of these three companies to create Phelps Dodge Inco." All required regulatory approvals for Inco's acquisition of Falconbridge have been received. Phelps Dodge's offer to acquire Inco is expected to close in September, subject to Phelps Dodge and Inco shareholder approval, regulatory approvals and customary closing conditions. About Phelps Dodge Phelps Dodge Corp. -- http://www.phelpsdodge.com/-- produces copper and molybdenum and is the largest producer of molybdenum- based chemicals and continuous-cast copper rod. The company and its two divisions, Phelps Dodge Mining Co. and Phelps Dodge Industries, employ approximately 15,000 people worldwide. About Inco Headquartered in Sudbury, Ontario, Inco Limited (TSX, NYSE:N) -- http://www.inco.com/-- is the world's #2 producer of nickel, which is used primarily for manufacturing stainless steel and batteries. Inco also mines and processes copper, gold, cobalt, and platinum group metals. It makes nickel battery materials and nickel foams, flakes, and powders for use in catalysts, electronics, and paints. Sulphuric acid and liquid sulphur dioxide are produced as byproducts. The company's primary mining and processing operations are in Canada, Indonesia, and the U.K. About Falconbridge Headquartered in Toronto, Ontario, Falconbridge Limited (TSX:FAL.LV)(NYSE: FAL) -- http://www.falconbridge.com/-- is a leading copper and nickel company with investments in fully integrated zinc and aluminum assets. Its primary focus is the identification and development of world-class copper and nickel orebodies. It employs 14,500 people at its operations and offices in 18 countries. The Company owns nickel mines in Canada and the Dominican Republic and operates a refinery and sulfuric acid plant in Norway. It is also a major producer of copper (38% of sales) through its Kidd mine in Canada and its stake in Chile's Collahuasi mine and Lomas Bayas mine. Its other products include cobalt, platinum group metals, and zinc. * * * Falconbridge's CDN$150 million 5% convertible and callable bonds due April 30, 2007, carries Standard & Poor's BB+ rating. =========== R U S S I A =========== BARYATINSKIY DIARY: Court Names F. Amarov as Insolvency Manager --------------------------------------------------------------- The Arbitration Court of Kaluga Region appointed Mr. F. Amarov as Insolvency Manager for OJSC Baryatinskiy Diary (TIN 4002000652). He can be reached at: F. Amarov Sovetskaya Str. 106. 248032 Kaluga Region Russia The Court commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. A23-6554/05B-10-142B. The Debtor can be reached at: OJSC Baryatinskiy Diary Sovetskaya Str. 45. Baryatino 249500 Kaluga Region Russia EVRAZ GROUP: Buys 24.9% of Highveld Steel From Anglo American ------------------------------------------------------------- Anglo American plc, Evraz Group S.A. and Credit Suisse have reached an agreement in relation to the sale by Anglo American of its shares in Highveld Steel and Vanadium Corp. Limited. Evraz and Credit Suisse have each acquired 24.9% of Highveld's share capital from Anglo American. These sales have closed. Evraz has an option to increase its stake in Highveld once regulatory approvals are received, including from competition authorities in South Africa and elsewhere. Evraz intends to file for such regulatory approvals as soon as possible. Subject to Evraz receiving such regulatory approvals, Evraz will be entitled to purchase Anglo American's remaining 29.2% shareholding as well as the 24.9% holding of Credit Suisse through separate option agreements. Should Evraz increase its interest beyond 35%, it will be obliged to make an offer to all shareholders of Highveld. On implementation of the Anglo American option arrangement, the aggregate amount that will have been realized by Anglo American for its 79% interest in Highveld is RUB4.89 billion (US$678 million converted to ZAR at R7.20/US$, the rate of exchange prevailing at the date of this announcement), equivalent to an average of RUB62.36 per Highveld share. This represents a 13% premium to the volume weighted average price of RUB55.15 per share for the 30-day period preceding Anglo American's announcement on 26 October 2005 in which it recorded, inter alia, its intention to dispose of its shareholding in Highveld. Anglo American and Credit Suisse have agreed that Anglo American will retain the voting rights in respect of the shares acquired by Credit Suisse. Anglo American will retain representatives on the Highveld board until such time as Anglo American disposes of all its shares in Highveld. "Evraz has great confidence in the South African steel industry and is excited by its new investment in Highveld and by the outlook for steel and vanadium markets," Evraz's Chairman, Alexander Frolov, said. "The South African steel market is experiencing strong demand growth driven by an upswing in new mining, infrastructure and industrial projects. We have high expectations of Highveld's internal growth plans for both its vanadium and steel businesses, including the expansion plan in excess of RUR1 billion, which will increase steel output by more than 20%. Evraz is committed to advancing black economic empowerment at Highveld." Tony Trahar, Chief Executive of Anglo American, said: "This represents another important step in the execution of the Group's strategy as announced in October last year. This substantial foreign direct investment by Evraz and Credit Suisse in South Africa is a strong vote of confidence in the country's prospects and will ensure that Highveld remains an efficient competitor in the South African and global markets." Citigroup has acted as exclusive financial adviser to Anglo American with respect to the transaction. Credit Suisse and ABN Amro have acted as joint financial advisers to Evraz. About Highveld Steel & Vanadium Highveld Steel and Vanadium is a leading vanadium producer and also produces steel, ferroalloys, and carbonaceous products. Ore for the steelworks and Vanchem is obtained from Highveld's Mapochs mine near Roossenekal in Mpumalanga. Hochvanadium is a wholly owned subsidiary in Austria which processes and sells vanadium products. Transalloys and Rand Carbide produce manganese alloys, ferrosilicon and carbonaceous products. About Anglo American Anglo American plc -- http://www.angloamerican.co.uk/-- is one of the world's largest mining and natural resource groups. With its subsidiaries, joint ventures and associates, it is a global leader in platinum group metals, gold and diamonds, with significant interests in coal, base and ferrous metals, industrial minerals and paper and packaging. The group is geographically diverse, with operations in Africa, Europe, South and North America, Australia and Asia. About Evraz Evraz Group is one of the largest vertically integrated steel and mining businesses with operations mainly in Russia. In 2004, Evraz produced 13.7 million tons of crude steel. Evraz's principal assets include three of the leading steel plants in Russia: Nizhny Tagil in the Urals region, and West Siberian and ovokuznetsk (in Siberia). * * * As reported by TCR-Europe on June 22, Fitch Ratings affirmed Luxembourg-based Evraz Group S.A.'s Issuer Default and senior unsecured ratings of BB- and its Short-term B rating. Evraz Group's 8-1/4% notes due November 2015 carry Moody's Investors Service's (P)B2 rating, Standard & Poor's B+ rating and Fitch's BB- rating. FURNITURE FACTORY 555: E. Demicheva to Manager Assets ----------------------------------------------------- The Arbitration Court of Rostov Region appointed Ms. E. Demicheva as Insolvency Manager for CJSC Furniture Factory 555. He can be reached at: Office 309 Pobeda Revolyutsii Pr. 85 Shakhty 346500 Rostov Region Russia The Court commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. A53-2440/2006g. S2-33. The Arbitration Court of Rostov Region is located at: Stanislavskogo Str. 8a 344008 Rostov-na-Donu Russia The Debtor can be reached at: CJSC Furniture Factory 555: Shakhty Rostov Region Russia GAZPROM: Agrees on Asset Swap Deal with E.ON AG ----------------------------------------------- OAO Gazprom and E.ON AG agreed July 13 on a framework deal to swap upstream, downstream and power generation assets. Both companies agreed to exchange a 25% minus 1 share participation interest in the Yuzhno-Russkoye gas condensate field for an equity package in E.ON. This includes shareholdings in the Hungarian entity, E.ON Ruhrgaz Storage and in E.ON Ruhrgaz Trade gas companies (a 50 % stake minus 1 share each) as well as for a 25 % stake plus 1 share in the regional E.ON Hungaria electricity and gas company. Additionally, it is reported that Gazprom will subsequently receive additional compensation from the transaction. At the same time, E.ON and Gazprom agreed to jointly implement electricity generation projects at European power plants. E.ON and Gazprom are resolute to strike elaborate asset swap deals by the year-end. The European Commission and Hungarian authorities must endorse projected acquisition of assets in Hungary. The signed framework deal is a further step to deeper cooperation between Gazprom and foreign companies in the upstream sector through the equivalently valuable and strategically attractive swap of assets. The stake in the Yuzhno-Russkoye gas field will expand and deepen the long- lasting partnership ties between Gazprom and E.ON. Given the increasing demand for natural gas, the companies are making a significant contribution in reinforcing the European energy supply security in a long run. Founded in June 2000 through the merger of VEBA and VIAG, the German E.ON AG company is the world's largest privately-held power & gas Concern with over EUR 56 bln in annual turnover and about 80,000 people employed. E.ON Ruhrgas AG (Ruhrgas AG, before July 1, 2004) has been part of E.ON AG since February 2003, overseeing the Group's gas business in Europe, including natural gas production, marketing, transmission and storage. The company possesses a manifold 11,273-km-long gas transmission network comprising 12 underground storage facilities with 5.1 bcm in overall working gas volume. In terms of natural gas marketing (690.2 bln kW/h), E.ON Ruhrgas is a leader in Germany and is among the top three firms in Europe. Owning a 6.5% stake in Gazprom, E.ON Ruhrgas is its largest foreign shareholder. Over a range of years, Gazprom and E.ON Ruhrgas have been successfully cooperating in the gas pipeline anticorrosion protection, gas-pumping unit operation optimization, gas dispatching and other joint businesses. In 2000 (Berlin) and 2002 (Moscow), Gazprom and Ruhrgas signed the Memoranda of understanding. On July 8, 2004, Gazprom and E.ON sealed the Memorandum of understanding that fixed accords to further deepen successful cooperation when implementing both companies' strategic projects. In addition to the traditional gas supply business, the parties started implementing joint gas extraction, transmission & marketing and power generation projects. Gazprom has so far launched production at the Yuzhno-Russkoye field representing the major resource base for gas shipments by the North European Gas Pipeline. Seismic survey and drilling operations are currently underway at the field that has over 700 bcm of the proven gas reserves. Projected production after full ramp-up -- some 25 bcm of gas per year. Production launch -- 4th quarter of 2007. About Gazprom Headquartered in Moscow, Russia, OAO Gazprom -- http://www.gazprom.ru/eng-- produces 94% of the country's natural gas, controls 25% of the world's reserves, and is also the world's largest gas producer. It focuses on gas exploration, processing, transport, and marketing. * * * As reported in the TCR-Europe on Jan. 18, Standard & Poor's Ratings Services raised its long-term corporate credit rating on OAO Gazprom to 'BB+' from 'BB'. As reported in the TCR-Europe on Oct 27, 2005, Fitch Ratings upgraded Gazprom International S.A. Series 1 US$1.25-billion structured export notes due Feb. 1, 2020 (XS0197695009) to 'BBB' from 'BBB-'. The upgrade follows Fitch's upgrade of OAO Gazprom's, the world's largest gas company, Senior Unsecured local and foreign currency ratings to 'BB+' from 'BB', and a change in Gazprom's going concern assessment, which is now equivalent to a 'BBB' rating compared to 'BBB-' previously. GAZPROM: Board Forms Seven-Member Asset Evaluation Committee ------------------------------------------------------------ The Board of Directors of OAO Gazprom decided to form a seven- member Asset Evaluation Committee of the Board and re-elected German Gref, a Gazprom Board Member and RF Economic Development & Trade Minister as the Committee Chairman. The Board of Directors also endorsed the company's action plan for the second half of 2006. The issue on the consolidation of Gazprom's assets in the household gas appliances manufacture sector was put off until the next meeting of the Board of Directors. The Asset Evaluation Committee is mainly responsible for assisting the Board of Directors in settling issues surrounding execution of deals with and management of subsidiary and associated companies' assets. The Committee's activity covers analysis and preparation of proposals to improve the Gazprom Group's property value assessment procedure, reports on the expediency of entering into asset related deals as well as recommendations on the voting of Gazprom's representatives in subsidiary and associated companies' management bodies. The Members of the Gazprom Board of Directors' Asset Evaluation Committee have been re-elected pursuant to the Standard Guidelines for a Board of Directors' Committee. Under the Guidelines, the authority of the Committee Members expires simultaneously with the expiry of the authority of the Board of Directors that has formed this Committee. To this end, the authority of the previously elected Asset Evaluation Committee Members expired on June 30, 2006. About Gazprom Headquartered in Moscow, Russia, OAO Gazprom -- http://www.gazprom.ru/eng-- produces 94% of the country's natural gas, controls 25% of the world's reserves, and is also the world's largest gas producer. It focuses on gas exploration, processing, transport, and marketing. * * * As reported in the TCR-Europe on Jan. 18, Standard & Poor's Ratings Services raised its long-term corporate credit rating on OAO Gazprom to 'BB+' from 'BB'. As reported in the TCR-Europe on Oct 27, 2005, Fitch Ratings upgraded Gazprom International S.A. Series 1 US$1.25-billion structured export notes due Feb. 1, 2020 (XS0197695009) to 'BBB' from 'BBB-'. The upgrade follows Fitch's upgrade of OAO Gazprom's, the world's largest gas company, Senior Unsecured local and foreign currency ratings to 'BB+' from 'BB', and a change in Gazprom's going concern assessment, which is now equivalent to a 'BBB' rating compared to 'BBB-' previously. GRANITE: Court Names Mr. M.Khuako as Insolvency Manager ------------------------------------------------------- The Arbitration Court of Adygeya Republic appointed Mr. M.Khuako as Insolvency Manager for LLC Granite (TIN 0102004050, KPP 0101011001). He can be reached at: Goncharova Str. 113 Maykop 385000 Adygeya Republic Russia The Court commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. A01-B-163-2006-3. The Debtor can be reached at: LLC Granite Shovgenova Str. 2 Khatukay Krasnogvardeyskiy Region Adygeya Republic Russia KHVOSHEVSKAYA NIVA: Court Starts Bankruptcy Supervision ------------------------------------------------------- The Arbitration Court of Nizhniy Novgorod Region will convene on September 05, 2006 to hear the bankruptcy supervision procedure on OJSC Khvoshevskaya Niva. The case is docketed under Case No. A43-4186/2006, 33-30. The Temporary Insolvency Manager is: I. Zolin Post User Box 166 603043 Nizhniy Novgorod Region Russia The Arbitration Court of Nizhniy Novgorod Region is located at: Kremlin 9 603082 Nizhniy Novgorod Region Russia The Debtor can be reached at: OJSC Khvoshevskaya Niva Khvoshevka Bogorodskiy Region Nizhniy Novgorod Region Russia KRONAS-WOOD: Ulyanovsk Court Begins Bankruptcy Supervision ---------------------------------------------------------- The Arbitration Court of Ulyanovsk Region has commenced bankruptcy supervision procedure on LLC Kronas-Wood. The case is docketed under Case No. A72-1397/06-17/8-b. The Temporary Insolvency Manager is: Y. Levin Post User Box 41 Syzran 446001 Samara Region Russia The Debtor can be reached at: LLC Kronas-Wood Yasashna Tashla Ulyanovsk Region Russia METROMEDIA INTERNATIONAL: Reporting Preliminary Results Soon ------------------------------------------------------------ Metromedia International Group, Inc. (PINK SHEETS: MTRM -- Common Stock, MTRMP -- Preferred Stock), revealed that although it has not fully completed the previously disclosed restatement activities required for the Company to file its Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2004, the Company intends to release preliminary financial results, through Dec. 31, 2005, for its principal Georgian business, Magticom, within the next 30 days. Ernie Pyle, the Company's Chief Financial Officer, said: "Although the financial information that will be released will be subject to adjustment until such time that the Company files its respective periodic reports with the United States Securities and Exchange Commission (Form 10-Q's and Form 10-K), we are encouraged that we can deliver to our shareholders more recent financial performance of our principal Georgian business." Mr. Pyle further stated, "With respect to the Company's periodic reports that are to be filed with the SEC, we believe that we have substantially completed the work effort associated with the restatement of the Company's financial statements prior to fiscal year 2004 as well as completed the preparation of financial statements and disclosures for fiscal year 2004. Accordingly, management has begun to focus attention on the Company's fiscal year 2005 periodic reporting obligations with the SEC, while continuing to resolve disclosure issues, as they have arisen or may arise, associated with the review process for the 2004 Form 10-K." About Metromedia International Headquartered in Charlotte, North Carolina, Metromedia International Group -- http://www.metromedia-group.com/-- through its subsidiary, Metromedia International Telecommunications, owns interests in telecom and cable TV operations in Russia, Georgia, and elsewhere in Eastern Europe. Since the first quarter of 2003, the Company has focused its principal attentions on the continued development of its core telephony businesses, and has substantially completed a program of gradual divestiture of its non-core cable television and radio broadcast businesses. The Company's core businesses includes Magticom, Ltd., the leading mobile telephony operator in Tbilisi, Georgia, and Telecom Georgia, a well-positioned Georgian long distance telephony operator. * * * Moody's Investors Service has placed Metromedia's subordinated debt rating at B3 and junior subordinated debt rating at B2. MILOSLAVSKIY: Ryazan Court Starts Bankruptcy Supervision -------------------------------------------------------- The Arbitration Court of Ryazan Region has commenced bankruptcy supervision procedure on OJSC Spirit Distillery Miloslavskiy. The case is docketed under Case No. A54-833/2005-S6. The Temporary Insolvency Manager is: N. Bogdanova Mayakovskogo Str. 1A 390046 Ryazan Region Russia The Debtor can be reached at: OJSC Spirit Distillery Miloslavskiy Miloslavskoye 391770 Ryazan Region Russia NORTH-WEST: Earns RUB1.41 Billion of Net Income in 2005 ------------------------------------------------------- North-West Telecom has summarized its operating results for 2005, according to International Financial Reporting Standards. The company's financial accounts and reports were audited by Ernst and Young and show a 32.9% increase in 2005 revenue, which reached RUB20.5 billion. Net income according to the IFRS grew by 109.8% in 2005 to RUB1.41 billion. The main share in the revenue structure consisted of revenue from local telephone access, the growth of which amounted to 45.6% in 2005. The highest growth rate 59.4% was shown by the revenue from new services (Internet access, including broadband access and ISDN, intelligent network services, etc.), which ensured 5.3% of the revenue (against 4.4% in 2004). The EBITDA increased by 41% for 2005 and amounted to RUB5.61 billion, EBITDA margin grew by 1.63 percentage points and amounted to 27.3%. For the first time in the history of Company the auditor opinion have been prepared without reservations. The main peculiarity of these reports was a full audit of own funds of JSC NWT, fixed assets (telecommunications equipment and networks) were appraised with the participation of American Appraisal Inc. Moreover in these report removed all reservations in connection with merged companies. North-West Telecom has been evaluating its pension obligations, inviting an independent actuary, for two years on end "The North-West Telecom's statement for 2005 according to IFRS make it possible to appraise objectively the assets, liabilities and financial results of the Company's operation for all representatives of the investment community," As Vladimir Akulich, Chef Executive Officer, said. According to Ivan Rodionov, a member of the Board of Directors of JSC NWT, Chairman of the Audit Committee of the Board of Directors of JSC NWT, "We are especially proud that the reports show a fair appraisal of the value of JSC NWT's financial investment in the shares of the Telecominvest holding. Deloitte & Touche CIS carried out the appraisal. This is just the first step in a fair appraisal of all assets of the Company and in improving the financial transparency of OJSC NWT. We are planning to carry out a market appraisal of the real estate owned by the Company next year, which will improve the investment attractiveness of North-West Telecom and will prove our intentions in the field of enhancing Company's transparency." About North-West Telecom OAO North-West Telecom is one of Russia's major telecommunication companies, and the leading operator in the North-West Federal District, providing traditional telephone services, as well as Internet and advanced data services. NWT originated from the merger of 10 regional fixed line operators and is ranked among the Financial Times' Top 100 major Eastern European companies. NWT ranks eighth in Standard & Poor's Transparency Index of the 50 largest MICEX-listed companies and fifth in the S & P Corporate governance rating. NWT international debt is rated by S&P B+ with stable outlook and domestic debt ruA+. * * * Standard & Poor's has assigned B+ ratings to North-West Telecom's long-term foreign issuer and local issuer credit ratings. Fitch also assigned a B+ rating to the company's foreign currency long-term debt and a B rating to its foreign currency short-term debt. OZERNOYE: Court Names A. Trifonov as Insolvency Manager ------------------------------------------------------- The Arbitration Court of Pskov Region appointed Mr. A. Trifonov as Insolvency Manager for OJSC Ozernoye. He can be reached at: A. Trifonov Post User Box 383 OPS-100 170100 Tver Region Russia The Court commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. A52-306/2006/4. The Debtor can be reached at: OJSC Ozernoye Lesnaya Str. 7 Pustoshka Pustoshkinskiy Region Pskov Region Russia PARTNER-KURSK: Court Names Mr. N. Gutenev as Insolvency Manager --------------------------------------------------------------- The Arbitration Court of Kursk Region appointed Mr. N. Gutenev as Insolvency Manager for OJSC Insurance Company Partner-Kursk (TIN 4629030213). He can be reached at: N. Gutenev Apartment 115 Khutorskaya Str. 12V 305029 Kursk Region Russia The Court commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. A35-1079/06 g. The Debtor can be reached at: OJSC Insurance Company Partner-Kursk: Dzerzhinskogo Str. 50 30500 Kursk Region Russia PYATIGORSKIY LIQUEUR-VODKA: N. Sotskaya Named to Manage Assets -------------------------------------------------------------- The Arbitration Court of Stavropol Region appointed Ms. N. Sotskaya as Insolvency Manager for OJSC Pyatigorskiy Liqueur- Vodka Distillery. She can be reached at: N. Sotskaya Post User Box 10 T-34 119034 Moscow Russia The Court commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. A63-329/2005-S5. The Arbitration Court of Stavropol Region Russia is located at: Mira Str. 4586 Stavropol Region Russia The Debtor can be reached at: OJSC Pyatigorskiy Liqueur-Vodka Distillery Kozlova Str. 36 Pyatigorsk Stavropol Region Russia ROL-TEX-MANUFACTURE: V. Chenskikh to Manage Insolvency Assets ------------------------------------------------------------- The Arbitration Court of Moscow Region appointed Mr. V. Chenskikh as Insolvency Manager for OJSC ROL-Tex-Manufacture. He can be reached at: V. Chenskikh Post User Box 54 125009 Moscow Russia Tel./Fax: (495) 955-25-51 The Court commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. A41-K2-15380/05. The Debtor can be reached at: OJSC Rol-Tex-Manufacture N. Zimina Str. 1 Drezna Orekhovo-Zuevskiy Region 142660 Moscow Region Russia ROSNEFT OIL: Intends to Boost Production After IPO -------------------------------------------------- OAO Rosneft Oil Company will expand its refining and boost output with the help of new equity partners from its initial public offering in Moscow last week, Reuters reports. According to Reuters, Rosneft CEO Sergei Bogdanchikov disclosed plans to spend US$3 billion on refining and US$15 billion on production by 2010 and expand ties with new partners and buyers of its IPO -- Britain's BP, Malaysia's Petronas and China's CNPC. Rosneft raised US$10.4 billion last week after placing 13 percent of its stock, initially priced at US$7.55, in Russia's largest IPO. Greg Walters of Dow Jones Newswires says that the share price announced after the IPO gave Rosneft a market cap of US$79.8 billion, well above Russian rival OAO Lukoil Holdings. However, the company's shares fell below the issue price on their trading debut on the Moscow Stock Exchange as lawyers in London prepare to argue in the High Court of England and Wales that the IPO is tainted by money-laundering, Carl Mortished of The Times reports. According to Yukos Oil spokesperson Clare Montgomery, the Financial Services Authority will be in violation of Britain's money-laundering rules if it authorized the listing of Rosneft shares in the London bourse, The Times relates. As reported in TCR-Europe on July 13, the FSA said it may approve the listing of Rosneft's shares for July 19. Rosneft purchased Yuganskneftegaz, Yukos's largest production unit, in December 2004 after the Russian government seized the asset as payment for Yukos' US$27.5 billion tax arrears for 2000-2003. According to the Moscow Times, Yukos could file for a judicial review in London's High Court if the FSA failed to explain its decision. This would automatically lead to a temporary stay on the sale in London, the Times relates. Rosneft has already received permission from Russia's market watchdog to place as much as 23.5% of its stock on foreign bourses as the state seeks to raise around US$9 billion. The Wall Street Journal previously reported that Rosneft will use proceeds from the IPO to pay off a US$7.5 billion syndicated bank loan that helped finance the state buyback of a 10.7% stake in Gazprom. Headquartered in Moscow, Russia, OAO Rosneft -- http://www.rosneft.ru/eng-- produces and markets petroleum products. The Company explores for, extracts, refines and markets oil and natural gas. Rosneft produces oil in Western Siberia, Sakhalin, the North Caucasus and the Arctic regions of Russia. * * * Standard & Poor's assigned B+ ratings to Rosneft's long-term and local foreign issuer credit, while Fitch assigned BB+ ratings to the Company's foreign currency and local currency long-term debt in 2005. SAPSAN: Bankruptcy Hearing Slated for Aug. 2 -------------------------------------------- The Arbitration Court of Voronezh Region will convene on Aug. 2 to hear the bankruptcy proceedings against LLC Novovoronezhskiy Liqueur-Spirit Factory Sapsan (TIN 3651005942). The case is docketed under Case No. A14-10454 2005 107/7b. The Insolvency Manager is: S. Ryabov Post User Box 1027 400105 Volgograd Region Russia The Debtor can be reached at: LLC Novovoronezhskiy Liqueur-Spirit Factory Sapsan Novovoronezh Prom.Area Vostochanaya 2 396072 Voronezh Region Russia TNK-BP FINANCE: Issues US$1.5-Billion Eurobonds for TNK-BP ---------------------------------------------------------- TNK-BP Finance S.A. issued a two-tranche US$1.5 billion bonds for TNK-BP International Ltd. on July 13, AK&M reports. The tranches are: -- US$1-billion ten-year bonds placed at 99.626% of par, with coupon rate of 7.5% per annum; and -- US$500-million five-year bonds, placed at 99.559% of par, with coupon rate of 6.875% per annum. The bonds were issued under TNK-BP Finance's US$5-billion Euro Medium Term Note program, which is rated BB+ by Fitch. UBS, BNP Paribas, Citigroup and CSFB arranged the bond issues. As reported in TCR-Europe on Feb. 15, Fitch Ratings assessed TNK-BP International Ltd.'s Senior Unsecured rating at BB+ with Outlook Positive and Short-term B. Its US$700 million eurobond is affirmed at BB+. TNK-BP holds a strategic position as the second largest liquids producer in the Russian intergraded operating environment, accounting for approximately 18% of Russia's total crude oil production. TNK-BP: Fitch Rates US$1.5 Billion Notes at BB+ ----------------------------------------------- Fitch Ratings assigned TNK-BP Finance S.A's US$1 billion 10-year bond and US$500 million five-year bond issues a final senior unsecured rating of BB+. The bonds are issued under its US$5 billion guaranteed debt issuance program rated BB+. Under the terms of the securities, noteholders will rely on a senior unsecured guarantee of TNK-BP International Ltd. for repayment. TNK-BP International Ltd. is Russia's third-largest oil company by production, active in exploration and production, as well as refining, wholesale and retail distribution. Crude oil production was around 1.58 million barrels per day in 2005. TORAEVO: Court Names Mr. V. Demidov as Insolvency Manager --------------------------------------------------------- The Arbitration Court of Chuvashiya Republic appointed Mr. V. Demidov as Insolvency Manager for CJSC Agricultural Company Toraevo. The Court commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. A79-7821/2005. The Debtor can be reached at: CJSC Agricultural Company Toraevo Morgaushskiy Region Chuvashiya Republic Russia TYUKALINSKIY: Court Starts Bankruptcy Supervision ------------------------------------------------- The Arbitration Court of Omsk Region has commenced bankruptcy supervision procedure on OJSC Butter-Cheese Combine Tyukalinskiy. The case is docketed under Case No. A46-2933/2006. The Temporary Insolvency Manager is: Y. Kushenko Post User Box 4143 644089 Omsk-89 Tel.: 8(913) 979-53-07 The Debtor can be reached at: OJSC Butter-Cheese Combine Tyukalinskiy Kooperativnaya Str. 49 Tyukalinsk 646330 Omsk Region Russia UFIMSKOYE REPAIR-TECHNICAL: Bankruptcy Hearing Slated for Aug. 1 ---------------------------------------------------------------- The Arbitration Court of Bashkortostan Republic will convene on Aug. 1 to hear the bankruptcy supervision procedure on CJSC Ufimskoye Repair-Technical Enterprise. The case is docketed under Case No. A07-6770/06-G-KhRM. The Temporary Insolvency Manager is: A. Ptashnikov Entuziastov Str. 4-33 Ufa 450096 Bashkortostan Republic Russia The Arbitration Court of Bashkortostan Republic is located at: Oktyabrskoy Revolyutsii Str. 63a Ufa Bashkortostan Republic Russia The Debtor can be reached at: CJSC Ufimskoye Repair-Technical Enterprise Yubileynaya Str. 4 Ufa 450029 Bashkortostan Republic Russia ============= U K R A I N E ============= AGROSERVICE: Court Names Andrij Koveza as Insolvency Manager ------------------------------------------------------------ The Economic Court of Kyiv Region appointed Andrij Koveza as Liquidator/Insolvency Manager for LLC Production Company Agroservice (code EDRPOU 31482934). He can be reached at: Andrij Koveza Antonovich Str. 47-B 03150 Kyiv Region Ukraine The Court commenced bankruptcy proceedings against the company after finding it insolvent on April 27. The case is docketed under Case No. 15/142-b-43/492. The Economic Court of Kyiv Region is located at: B. Hmelnitskij Boulevard 44-B 01030 Kyiv Region Ukraine AURA: Mikolaiv Court Starts Bankruptcy Supervision -------------------------------------------------- The Economic Court of Mikolaiv Region commenced bankruptcy supervision procedure on JSCOT Firm Aura (code EDRPOU 00307402). The case is docketed under Case No. 5/192/06. The Temporary Insolvency Manager is: Tetyana Timofeyeva Lenin Ave. 267/144 54008 Mikolaiv Region Ukraine The Economic Court of Mikolaiv Region is located at: Admiralska Str. 22 54009 Mikolaiv Region Ukraine The Debtor can be reached at: JSCOT Firm Aura Mlinova Str. 21 54055 Mikolaiv Region Ukraine FARIMED: Kyiv Court Appoints Andrij Koveza as Liquidator -------------------------------------------------------- The Economic Court of Kyiv Region appointed Andrij Koveza as Liquidator/Insolvency Manager for LLC Farimed (code EDRPOU 30109659). He can be reached at: Andrij Koveza Antonovich Str. 47-B 03150 Kyiv Region Ukraine The Court commenced bankruptcy proceedings against the company after finding it insolvent on May 15. The case is docketed under Case No. 23/195-b. The Economic Court of Kyiv Region is located at: B. Hmelnitskij Boulevard 44-B 01030 Kyiv Region Ukraine FORTUNA-KRYM: Court Names Atik Drogajtsev as Insolvency Manager --------------------------------------------------------------- The Economic Court of AR Krym appointed Atik Drogajtsev as Liquidator/Insolvency Manager for LLC Agrofirm Fortuna-Krym (code EDRPOU 30913497). He can be reached at: Drogajtsev Atik Korchagin Str. 34/22 Sevastopol AR Krym Region Ukraine The Court commenced bankruptcy proceedings against the company after finding it insolvent on April 10. The case is docketed under Case No. 2-5/2309-2006. The Economic Court of AR Krym Region is located at: Karl Marks Str. 18 Simferopol 95000 AR Krym Region Ukraine The Debtor can be reached at: LLC Agrofirm Fortuna-Krym Korchagin Str. 34/22 Sevastopol AR Krym Region Ukraine INVEST-AGROPROM: Court Names Tax Authority as Liquidator -------------------------------------------------------- The Economic Court of Cherkassy Region appointed Cherkassy' Regional State Tax Inspection as Liquidator for LLC Invest- Agroprom (code EDRPOU 30629721). The Liquidator can be reached at: Cherkassy' Regional State Tax Inspection Hreshatik Str. 235 18000 Cherkassy Region Ukraine The Court commenced bankruptcy proceedings against the company after finding it insolvent. The Economic Court of Cherkassy Region is located at: Shevchenko Avenue 307 18005 Cherkassy Region Ukraine The Debtor can be reached at: LLC Invest-Agroprom Krasin Str. 8/1 Cherkassy Region Ukraine KORVET-PLUS: Court Names Tax Agency as Liquidator ------------------------------------------------- The Economic Court of Cherkassy Region appointed Cherkassy' Regional State Tax Inspection as Liquidator for LLC Korvet-Plus (code EDRPOU 22794408). The Liquidator can be reached at: Cherkassy' Regional State Tax Inspection Hreshatik Str. 235 18000 Cherkassy Region Ukraine The Court commenced bankruptcy proceedings against the company after finding it insolvent. The Economic Court of Cherkassy Region is located at: Shevchenko Avenue 307 18005 Cherkassy Region Ukraine The Debtor can be reached at: LLC Korvet-Plus Gagarin Str. 21/209-210 Cherkassy Region Ukraine KVANT-PLUS: Court Names Regional Tax Agency as Liquidator --------------------------------------------------------- The Economic Court of Cherkassy Region appointed Cherkassy' Regional State Tax Inspection as Liquidator for LLC Kvant-Plus (code EDRPOU 32654440). The Liquidator can be reached at: Cherkassy' Regional State Tax Inspection Hreshatik Str. 235 18000 Cherkassy Region Ukraine The Court commenced bankruptcy proceedings against the company after finding it insolvent. The Economic Court of Cherkassy Region is located at: Shevchenko Avenue 307 18005 Cherkassy Region Ukraine The Debtor can be reached at: LLC Kvant-Plus Smilyanska Str. 144/305 Cherkassy Region Ukraine LADA: Court Names Kozyatin' State Tax Inspection as Liquidator -------------------------------------------------------------- The Economic Court of Vinnitsya Region appointed Kozyatin' State Tax Inspection as Liquidator for Agricultural LLC Lada (code EDRPOU 32060537). The Liquidator can be reached at: Kozyatin' State Tax Inspection Kozyatin 22100 Vinnitsya Region Ukraine The Court commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. 5/118-06. The Economic Court of Vinnitsya Region is located at: Hmelnitske Shose 7 21036 Vinnitsya Region Ukraine The Debtor can be reached at: Agricultural LLC Lada Pikovets Kozyatin District 22144 Vinnitsya Region Ukraine LIVADA: Court Appoints Tax Agency to Liquidate Assets ----------------------------------------------------- The Economic Court of Cherkassy Region appointed Cherkassy' Regional State Tax Inspection as Liquidator for LLC LIVADA (code EDRPOU 21350264). The Liquidator can be reached at: Cherkassy' Regional State Tax Inspection Hreshatik Str. 235 18000 Cherkassy Region Ukraine The Court commenced bankruptcy proceedings against the company after finding it insolvent. The Economic Court of Cherkassy Region is located at: Shevchenko Avenue 307 18005 Cherkassy Region Ukraine The Debtor can be reached at: LLC Livada Smilyanska Str. 76/66 Cherkassy Region Ukraine LVIVVODBUD: Court Starts Bankruptcy Supervision ----------------------------------------------- The Economic Court of Lviv Region commenced bankruptcy supervision procedure on OJSC Lvivvodbud (code EDRPOU 01036916) on May 30. The case is docketed under Case No. 6/64-8/110. The Temporary Insolvency Manager is: Vitalij Koval Listopadna Str. 11/25 79034 Lviv Region Ukraine The Economic Court of Lviv Region is located at: Lichakivska Str. 81 79010 Lviv Region Ukraine The Debtor can be reached at: OJSC Lvivvodbud Chajkovskij Str. 17 Lviv Region Ukraine OLIVIYA: Court Names LLC Irida to Liquidate Assets -------------------------------------------------- The Economic Court of Kyiv Region appointed LLC Trade-Industrial Firm Irida as Liquidator for LLC Trade House Oliviya (code EDRPOU 32920113). The Liquidator can be reached at: LLC Trade-Industrial Firm Irida Peremogi Ave. 136/34 03115 Kyiv Region Ukraine The Court commenced bankruptcy proceedings against the company after finding it insolvent on May 16. The case is docketed under Case No. 15/288-b. The Economic Court of Kyiv Region is located at: B. Hmelnitskij Boulevard 44-B 01030 Kyiv Region Ukraine PETRIVSKE-PLUS: Kirovograd Court Begins Bankruptcy Supervision -------------------------------------------------------------- The Economic Court of Kirovograd Region commenced bankruptcy supervision procedure on LLC Petrivske-Plus (code EDRPOU 00853760) on April 11. The case is docketed under Case No. 9/62. The Temporary Insolvency Manager is: Andrij Hashevatskij Shevchenko Str. 25/27 25006 Kirovograd Region Ukraine The Economic Court of Kirovograd Region is located at: Lunacharski Str. 29 25006 Kirovograd Region Ukraine The Debtor can be reached at: LLC Petrivske-Plus Tereshkova Str. 15 Petrivske 28322 Kirovograd Region Ukraine REINFORCED METAL: Court Names Tetyana Pashkova as Liquidator ------------------------------------------------------------ The Economic Court of Donetsk Region appointed Tetyana Pashkova as Liquidator/Insolvency Manager for LLC Reinforced Metal Constructions Plant (code EDRPOU 30425016). She can be reached at: Tetyana Pashkova Kujbishev Str. 240/50 83122 Donetsk Region Ukraine The Court commenced bankruptcy proceedings against the company after finding it insolvent on May 23. The case is docketed under Case No. 5/190 B. The Economic Court of Donetsk Region is located at: Artema Str. 157 83048 Donetsk Region Ukraine The Debtor can be reached at: LLC Reinforced Metal Constructions Plant Repin Str. Makiyivka Donetsk Region Ukraine ZALIZOBETON-MARKET: Court Names Tax Authority as Liquidator ----------------------------------------------------------- The Economic Court of Cherkassy Region appointed Cherkassy' Regional State Tax Inspection as Liquidator for Zalizobeton- Market (code EDRPOU 30476689). The Liquidator can be reached at: Cherkassy' Regional State Tax Inspection Hreshatik Str. 235 18000 Cherkassy Region Ukraine The Court commenced bankruptcy proceedings against the company after finding it insolvent. The Economic Court of Cherkassy Region is located at: Shevchenko Avenue 307 18005 Cherkassy Region Ukraine The Debtor can be reached at: Zalizobeton-Market Himikiv Avenue 12 Cherkassy Region Ukraine =========================== U N I T E D K I N G D O M =========================== ABSOLUTE FINISH: Creditors Confirm Voluntary Liquidation -------------------------------------------------------- Creditors of Absolute Finish Limited confirmed the company's voluntary liquidation and the appointment of Allan Cooper and Brendan Ambrose Guilfoyle of The P&A Partnership as Liquidators on April 24. The P&A Partnership (aka Poppleton and Appleby) -- http://www.thepandapartnership.com/-- acts for all clearing banks and a growing number of factors and asset lenders. Its clients include multinational PLCs, SMEs, financial institutions, accountants, solicitors and business advisors. Absolute Finish Limited can be reached at: Suite 2 Victoria House South Street Farnham Surrey GU9 7QU United Kingdom Tel: 01483 722 277 Fax: 01483 730 055 AEW DELFORD: Bank of Scotland Taps Receivers from PwC ----------------------------------------------------- Bank of Scotland appointed Stephen Mark Oldfield and David Matthew Hammond of PricewaterhouseCoopers LLP joint administrative receivers of AEW Delford Group Limited (Company Number 03055806) on June 23. PricewaterhouseCoopers LLP -- http://www.pwcglobal.com/-- provides, among others, auditing services, accounting advice, tax compliance and consulting, financial consulting and advisory services to clients in a variety of industries. Headquartered in Essex, United Kingdom, AEW Delford Group Limited manufactures and sells specialized proprietary equipment for food and packaging industries. ALERIS INT'L: S&P Removes BB- Credit Rating from Watch Negative --------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'BB-' corporate credit rating on Beachwood, Ohio-based Aleris International Inc. and removed it from CreditWatch, where it was placed with negative implications on March 21. The CreditWatch placement followed Aleris' announcement that it would acquire the downstream aluminum assets of Corus Group PLC for US$880 million in cash and assumed debt. The outlook is negative. At the same time, Standard & Poor's assigned its 'BB-' and '2' recovery ratings to the company's proposed US$650 million senior secured term loan B. The '2' recovery rating indicates the expectation of a substantial recovery of principal in the event of a payment default. The ratings are based on preliminary terms and conditions and are predicated on the completion of the Corus transaction and related financings substantially in the form currently anticipated. "The company's debt levels are relatively high, and we remain concerned that management will continue to opportunistically make cash-financed acquisitions," said Standard & Poor's credit analyst Marie Shmaruk. "However, Aleris' markets remain relatively healthy, which should enable the company to reduce leverage to less than 4x. We could change the outlook to stable if management reaches and maintains more moderate debt levels. Ratings on Aleris could be pressured if the company's debt levels remain high and performance weakens materially because of intensified competition or weaker market conditions." The proceeds from the issue, along with proceeds from a revolving credit facility and bridge loans, will primarily be used to refinance existing debt, finance the acquisition, and fund working capital and transactions costs. Aleris is a vertically integrated manufacturer of aluminum sheet for distributors and the transportation, construction, and consumer durables end-user markets. BREEZE BUILDING: Creditors Ratify Winding Up Resolution ------------------------------------------------------- Creditors of Breeze Building Services Limited, on April 19, ratified a resolution to wind up the company together with the appointment of Alan H. Tomlinsons of Tomlinsons as Liquidator. Tomlinsons -- http://www.tomlinsons.co.uk/-- is an independent firm of Licensed Insolvency Practitioners with offices in Manchester, Blackburn and London. It specializes in all types of business recovery and insolvency procedures, as well as offering advice to companies and individuals who believe they may be heading towards, or are already in, financial difficulty. Breeze Building Services Limited can be reached at: 3 The Quadrant Coventry West Midlands CV1 2DY United Kingdom Tel: 024 7624 3654 Fax: 024 7624 3655 Web: http://www.breezeservices.co.uk/ CASTLEGATE 399: Hires Deloitte & Touche to Administer Assets ------------------------------------------------------------ Ian Brown and Christopher James Farrington of Deloitte & Touche LLP were appointed joint administrators of Castlegate 399 Limited (Company Number 05607212) on June 15. Headquartered in London, Deloitte & Touche LLP -- http://www.deloitte.com/-- is the United Kingdom member firm of Deloitte Touche Tohmatsu, a Swiss Verein whose member firms are separate and independent legal entities. It provides audit, tax, consulting and corporate finance services through more than 9,000 people in 21 locations. Headquartered in Nottingham, United Kingdom, Castlegate 399 Limited is engaged in commercial printing. CEOL CASTLE: Creditors Nominate Liquidator ------------------------------------------ Creditors of Ceol Castle Limited nominated Andrew Fender of Sanderlings LLP as Liquidator during an extraordinary general meeting on April 25. The company can be reached at: Ceol Castle Limited 402 Moseley Road Birmingham B12 9AT United Kingdom Tel: 077 6297 5061 CLUB A.C.: Taps G. W. Rhodes to Liquidate Assets ------------------------------------------------ G. W. Rhodes of Begbies Traynor was appointed Liquidator of Club A.C. Entertainments Limited after creditors agreed to wind up the company on April 26. Begbies Traynor -- http://www.begbies.com/-- assists companies, creditors, financial institutions and individuals on all aspects of financial restructuring and corporate recovery. Club A.C. Entertainments Limited can be reached at: 13 Robertson Street Hastings East Sussex TN341HL United Kingdom Tel: 01424 203 545 CRAGSIDE CONTRACTORS: Creditors Resolve to Voluntary Liquidation ---------------------------------------------------------------- Creditors of Cragside Contractors Limited resolved to voluntarily liquidate the company's assets during an extraordinary general meeting on April 26. Subsequently, Malcolm Edward Fergusson of Fergusson & Co. Ltd. was appointed Liquidator. The company can be reached at: Cragside Contractors Limited 6 The Courtyard Durham Way North Aycliffe Ind Pk Newton Aycliffe County Durham DL5 6HP United Kingdom Tel: 01325 318 112 Fax: 01325 318 112 Web: http://www.cragside-contractors.co.uk/ CURTI LIFTS SOUTHERN: Confirms Liquidator's Appointment ------------------------------------------------------- Creditors of Curti Lifts (Southern) Limited confirmed the appointment of Stephen Franklin of Franklin & Co. as Liquidator on April 19. The company can be reached at: Curti Lifts (Southern) Limited Unit G Middle Road Park Gate Southampton Hampshire SO317GH United Kingdom Tel: 01489 574 246 Fax: 01489 574 256 CURTI LIFTS SOUTHWEST: Creditors Pass Winding Up Resolution ----------------------------------------------------------- Creditors of Curti Lifts (SouthWest) Limited passed a resolution to wind up the company's operations during an extraordinary general meeting on April 19. The company can be reached at: Curti Lifts (South West) Limited 71-73 Moore Avenue Bradford BD6 3HJ United Kingdom Tel: 0117 942 6994 DIGITAL CONCEPTS: Financial Woes Trigger Liquidation ---------------------------------------------------- Digital Concepts (London) Limited is winding up its operations after creditors established the company could no longer continue its business due to mounting debts. Alan Simon of Langley Group LLP was appointed Liquidator. The company can be reached at: Digital Concepts (London) Limited 2 Station Close Potters Bar Hertfordshire EN6 1TL Tel: 01707 660097 Web: http://www.dcldigitalco.uk/ DISTRIBUTION SOFTWARE: Appoints Liquidator from Crane & Partners ---------------------------------------------------------------- Guy Charles David Harrison of Crane & Partners were appointed Joint Liquidators by the Shareholders of Distribution Software Systems Limited after the company was placed into creditors' voluntary liquidation on April 24. The company can be reached at: Distribution Software Systems Limited Garrard House 2-6 Homesdale Road Bromley BR2 9LZ United Kingdom Tel: 020 8466 5025 DPS COMPOSITES: Creditors' Meeting Slated for July 20 ----------------------------------------------------- Creditors of DPS Composites Limited (Company Number 02029010) will meet at 2:00 p.m. on July 20 at: The Holiday Inn Reading Caversham Bridge Reading RG1 8BD United Kingdom Creditors who want to be represented at the meeting may appoint proxies. Proxy forms must be submitted together with written debt claims at 12:00 noon on July 19 at: Timothy Colin Hamilton Ball and Roderick John Weston Joint Administrators Mazars LLP Clifton Down House Beaufort Buildings Clifton Down, Clifton Bristol Avon BS8 4AN United Kingdom Tel: 0117 973 4481 Fax: 0117 974 5203 E-mail: tim.ball@mazars.co.uk Mazars -- http://www.mazars.com/-- is an international, integrated and independent organization, specialized in audit, accounting, tax and advisory services. ECLIPSE EMBROIDERY: Brings In Liquidator from Baker Tilly --------------------------------------------------------- Creditors of Eclipse Embroidery & Print Limited appointed Matthew Richard Meadley Wild of Baker Tilly as Liquidator during an extraordinary general meeting on April 20. Baker Tilly -- http://www.bakertilly.co.uk/-- is a leading independent firm of chartered accountants and business advisers in the United Kingdom. The firm's annual fee income is over GBP168 million and is part of a global network, which has 122 member firms in 85 countries as an independent member of Baker Tilly International. Eclipse Embroidery & Print Limited can be reached at: Eclipse House Curtis Road Dorking Surrey RH4 1EJ Fax: 01306 886 156 EGG BANKING: Moody's Changes Financial Strength Rating Outlook -------------------------------------------------------------- Moody's Investors Service changed to stable from positive the outlook on Egg Banking's D+ bank financial strength rating. The A3/Prime-2 debt and deposit ratings are affirmed with their existing stable outlook. Moody's said that Egg Banking's D+ financial strength rating continues to reflect its still developing banking franchise, its improving pre-provision profitability and its solid funding base, as well as the recent deterioration in asset quality and the related increase in provisions. The outlook change to stable from positive follows the significant increase in provisioning levels in the bank's unsecured lending book in 2005, which reflects the worsening conditions for unsecured lending in the U.K. Given the high levels of indebtedness of the U.K. consumer and the potential for ongoing less favorable conditions in the U.K. economy Moody's would not expect this to improve in the medium term. The bank took steps to strengthen its underwriting in 2004 and this, together with a reduced focus on personal loans should help to stabilize the bank's asset quality, however the resultant fall in income from related insurance products sold with personal loans is likely to have a significant effect on profitability in 2006. The maintenance of the D+ financial strength rating is based on Moody's expectation that post provision income will return to 2005 levels in 2007. Moody's noted that the bank is being integrated into Prudential U.K. in a much more significant manner than in the past and this closer co-operation may unlock further potential and could lead to sustainable improvements in the bank's cost efficiency and asset quality. An increase in generating synergies and a track record of further integration with Prudential could also have positive implications for the deposit ratings. Further downward pressure on the financial strength rating would be likely if the bank was to experience a further deterioration in asset quality or if profitability does not return to more normal levels by the end of 2007. Egg Banking plc, is headquartered in London, United Kingdom and had assets of GBP10.8 billion (EUR18.5 billion) at end-December 2005. FAIRFIELD CLADDING: Hires Joint Liquidators from Begbies Traynor ---------------------------------------------------------------- David Moore and Donald Bailey of Begbies Traynor were appointed Joint Liquidators of Fairfield Cladding Supplies Limited after creditors decided to wind up the company on April 25. Begbies Traynor -- http://www.begbies.com/-- assists companies, creditors, financial institutions and individuals on all aspects of financial restructuring and corporate recovery. Fairfield Cladding Supplies Limited can be reached at: Fairfield Street Liverpool L7 0JY United Kingdom Tel: 0151 228 1313 FIXED LINK: Moody's Cuts Rating on GBP620-Mln Notes to B2 --------------------------------------------------------- Moody's Investors Service downgraded the GBP120 million 8.15% Class A Notes due 2026 and the Underlying Rating of the GBP620 million 5.78% Guaranteed Notes due 2028 of Fixed Link Finance 2 B.V. (FLF2) to B2 from B1. The ratings remain on review with direction uncertain. The review was initiated on June 5, following the announcement by the Eurotunnel PLC/S.A. group that it had signed a binding preliminary restructuring agreement with a committee representing certain of its creditors. The Aaa ratings of FLF2's GBP620 million Guaranteed Notes, which are based upon the unconditional and irrevocable guarantee of principal and interest by MBIA Assurance S.A., remain unchanged. The rating action has been prompted by the announcement that Eurotunnel has applied to the French courts to enter a process known as a 'procedure de sauvegarde', which is intended to give Eurotunnel relief from its creditors while it negotiates a debt restructuring plan with them. If granted, which Moody's considers likely, such procedure will permit Eurotunnel to cease payments to debt holders while the procedure is ongoing. The downgrade reflects Moody's view that the probability that the Un-guaranteed Debt will default is now very high, whereas previously Moody's had assumed that the execution of the Capital Restructuring Plan, or a variation thereon, could be completed in time to avoid a payment default on the Un-guaranteed Debt. Nevertheless, the B2 rating factors Moody's assumption that the recovery of unguaranteed Debt outstanding will be 100% or very close to 100%. FLF2 is a special purpose company that has lent the proceeds of the notes it has issued to Eurotunnel in the form of Tier 1A Loans. All Eurotunnel debt holders benefit from a security interest over the assets of those French and U.K. companies that make up the Eurotunnel group that it is possible to secure on a fully cross-collateralized basis. In addition, the Eurotunnel debt holders have the benefit of "rights of substitution', i.e. the right to take over the Concession owned by Eurotunnel through new companies held for the benefit of Eurotunnel debt holders. The rating has been maintained on review with direction uncertain, reflecting Moody's understanding that the Capital Restructuring Plan or a variation thereon may be agreed by Eurotunnel and its creditors, which would result in the Un- guaranteed Debt remaining whole and in place with a credit profile higher than B2, but also the possibility that restructuring negotiations may not be successful and the consequent uncertainties that this would create. From the perspective of a possible upgrade, Moody's review of the Un-guaranteed Debt will continue to focus on: -- likely developments in Eurotunnel's operating performance over the coming few years; and -- the key terms of the Capital Restructuring Plan or variations thereon, many critical features of which are as yet unknown or still developing. From the perspective of a possible further downgrade, Moody's will continue to assess: -- the likelihood that the Capital Restructuring Plan or broadly equivalent plan will not be completed and the consequence of such a development, i.e. the subsequent insolvency of Eurotunnel; and -- the risk that consequent substitution by Eurotunnel creditors will not operate completely in accordance with lan. While the terms of the Capital Restructuring Plan or successor debt restructuring plan may change from those previously envisaged following further negotiations between Eurotunnel and its creditors, Moody's does not believe that such terms would likely change to the extent that there will be impairment of the Tier 1A Loans. Furthermore, if there is no agreement between Eurotunnel and its debt holders, Moody's considers it likely that the process of substitution will be effective and will ensure an ultimate recovery of all Un-guaranteed Debt within a few years. Nevertheless, the procedure of substitution is untested, which creates some uncertainties as to the process, timing and success of execution. Eurotunnel's rationale for seeking protection through a 'procedure de sauvegarde' is somewhat unclear, in Moody's view, given that negotiations with creditors were continuing in earnest. Such negotiations will need to continue during the procedure. However, Moody's expects that the procedure will force the parties to reach an agreement within the next few months, failing which a substitution is likely. Therefore, the initiation of the procedure may well have reduced all parties' room to accommodate any unexpected events. The Capital Restructuring Plan envisages: -- the continuation of the FLF2 debt and the related Tier 1A Loans, -- the repayment of Eurotunnel's Tier 1 Loans and Tier 2 Loans, and -- a partial repayment of Eurotunnel's Tier 3 Loans, together with an exchange of the un-redeemed Tier 3 Loans for an equity-like debt instrument with a cash alternative. However, critical elements of the Capital Restructuring Plan remain uncertain, including the maturity and financial terms of each class of new Eurotunnel debt that will be created as part of the Capital Restructuring Plan, and the inter-creditor arrangements that will need to be implemented to regulate the rights of all debt holders versus each other and Eurotunnel. Ratings outstanding: -- GBP620 million 5.78% Guaranteed Notes due 2028: Aaa; -- underlying Rating of the above: B2, review direction uncertain; and -- GBP120 million 8.15% Class A Notes due 2026: B2, review direction uncertain. Fixed-Link Finance 2 B.V. is a special purpose company incorporated in the Netherlands solely for the purpose of issuing the Class A Notes and Guaranteed Notes and lending the proceeds to members of the Eurotunnel PLC and Eurotunnel S.A. group. The Eurotunnel PLC and Eurotunnel S.A. group manages the infrastructure of the Channel Tunnel and operates passenger shuttle and truck shuttle services between Folkestone in the U.K. and Coquelles in France. FORD MOTOR: Moody's Lowers Senior Unsecured Ratings to B2 --------------------------------------------------------- Moody's Investors Service lowered the Corporate Family and senior unsecured ratings of Ford Motor Company to B2 from Ba3 and the senior unsecured rating of Ford Motor Credit Company to Ba3 from Ba2. The Speculative Grade Liquidity rating of Ford has been affirmed at SGL-1, indicating very good liquidity over the coming 12-month period. The outlook for the ratings is negative. The downgrade of the Ford ratings reflects Moody's expectation that the company's performance in North America will face considerable additional stress due to high fuel prices and the resulting shift in consumer preference away from the very profitable SUV segment. During the six months through June 2006 Ford's sales of mid-size SUVs fell by 24.7% and sales of large SUVs declined by 32.1%. Despite the fact that solid market acceptance of Ford's new mid- size and full-size cars has helped maintain US market share above 18%, the dramatic shift away from the SUV segment undermines prospects that Ford's Way Forward restructuring program will materially strengthen its weak credit metrics before 2008. Bruce Clark, a senior vice president with Moody's, said "The strong performance of Ford's new cars is certainly a positive. But the profitability of these vehicles doesn't come close to what the company had been earning on Explorers and Expeditions. This market shift is really hurting Ford and is pushing out the time frame during which the restructuring plan might contribute to any meaningful improvement in its credit ratios." In addition to the market shift from SUVs, Ford faces considerable challenges in other areas. These include implementing its extensive Way Forward restructuring initiative, reversing the chronically poor performance of Jaguar, contending with the ongoing erosion of its domestic supplier base, addressing the growing competitiveness and share gains of Asian manufacturers, and preparing for the renegotiation of its UAW contract in late 2007. As part of these contract negotiations it will be critical for Ford to achieve a material degree of relief in the areas of health care costs for active workers and the JOBs bank program. The decision by Ford's board of directors to cut both the company's dividend and director fees by half will have minimal impact on Ford's cash flow, but may contribute the constructive character of the dialogue with the UAW. Ford's negative outlook reflects the fact that the company is weakly positioned within the B2 rating category, and any shortfall in contending with the array of challenges that it faces could result in further pressure on the rating. Ford's liquidity position remains strong with US$24 billion in cash and short-term VEBA balances, and the company's Speculative Grade Liquidity Rating has been affirmed at SGL-1. Nevertheless, the company's weak operating and competitive position limits its capacity to absorb additional stress. For the LTM through March, Ford's automotive business had an operating margin of negative 2.8%, interest coverage well below 1x, and free cash flow of negative US$2.8 billion. The downgrade of Ford Credit's long-term rating to Ba3, with a negative outlook, considers the firm's ownership by, and concentrated operating relationship with, Ford Motor. This connection results in a ratings linkage between the two firms. Ford Credit's rating already incorporated expectations that declining portfolio balances, higher borrowing costs, and a leveling of credit quality improvements are likely to constrain the company's profitability in coming periods. However, in Moody's view, Ford's deeper operating challenges and longer turnaround horizon could have further negative implications for Ford Credit's results and financial condition, including its origination volumes, asset quality, profits and liquidity, thus negatively affecting its stand-alone credit profile. The one notch downgrade of Ford Credit's long-term rating widens the differential from Ford's rating to two notches from one. This notching differential continues to reflect Moody's view that loss severity in the event of default for Ford Credit would be meaningfully lower than for Ford. At the lower extremity of Moody's rating scale, the same difference in expected loss results in a greater differential between the two firms' ratings. While Moody's also believes Ford Credit's probability of default is lower than its parent's, there remains uncertainty by virtue of Ford's ownership and control that limits the potential ratings differential between the two firms. "Moody's believes Ford is economically motivated to maintain Ford Credit's operating strengths and enterprise value, but it could direct the company to take actions that, while seen by Ford's board to be beneficial for the consolidated Ford enterprise, are nevertheless adverse to Ford Credit's profile," said Mark Wasden, a Moody's Senior Credit Officer. Ford Motor Company, headquartered in Dearborn, Michigan, is the world's third largest automobile manufacturer. Ford Motor Credit Company, also headquartered in Dearborn, Michigan, is the world's largest auto finance company. GENERAL MOTORS: Reviewing Nissan-Renault Deal; Toyota Might Bid --------------------------------------------------------------- General Motors Corp. and Nissan-Renault are reviewing a proposed three-way alliance for 90 days, published reports say. Renault-Nissan is a collaboration between Nissan Motor Co., Ltd., and Renault S.A. A GM shareholder, Kirk Kerkorian, broached the idea of pulling in GM into the two-way tie-up. Mr. Kerkorian owns 9.9% equity stake in GM through his investment firm Tracinda Corp. Toyota Motor Corp., USA, however, might throw a wrench to the possible deal as it is likely to throw in a bid to ally with GM, the Business Week reports. But, as reported in CNN Money, Toyota was quick to quell rumors that it's interested in GM. GM and Toyota jointly operate an assembly plant in Freemont, California. GM Chairman and CEO G. Richard Wagoner, Jr., said a deal with another automaker besides Renault-Nissan was possible, according to Automotive News; a likely possibility since the US$3-billion proposed alliance is seen as a hostile move by some of GM's management even after Renault-Nissan's President and CEO Carlos Ghosn publicly declared that the ball is in GM's hands. Though Mr. Ghosn received a go signal from Renault-Nissan's board to negotiate a deal, Mr. Ghosn said GM has to initiate the three-way alliance. Mr. Ghosn also clarified that he's not after Mr. Wagoner's job. Talks of a possible alliance surfaced amidst GM's troubles as it faces market, production and cost issues. GM is currently implementing a turnaround plan that involves plant closures and job cuts. Analysts opined that all these talks about alliances are just distracting GM from doing what it should be doing: create a good product and increase market share. Though still number one in the world, GM's market share is continually eroding. Based on 2005 new vehicles sales, GM sold 14.2% of the total number of vehicles sold. Toyota has 13%. Ford comes in third with 12.4%. Renault-Nissan has 9.6% of the pie. About General Motors General Motors Corp. -- http://www.gm.com/-- the world's largest automaker, has been the global industry sales leader for 75 years. Founded in 1908, GM today employs about 327,000 people around the world. With global headquarters in Detroit, GM manufactures its cars and trucks in 33 countries including Mexico. In 2005, 9.17 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn and Vauxhall. GM operates one of the world's leading finance companies, GMAC Financial Services, which offers automotive, residential and commercial financing and insurance. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. * * * As reported in the Troubled Company Reporter on June 30, 2006, Standard & Poor's Ratings Services held all its ratings on General Motors Corp. -- including the 'B' corporate credit rating and the 'B+' bank loan rating, but excluding the '1' recovery rating -- on CreditWatch with negative implications, where they were placed March 29, 2006. As reported in the Troubled Company Reporter on June 22, 2006, Fitch assigned a rating of 'BB' and a Recovery Rating of 'RR1' to General Motor's new US$4.48 billion senior secured bank facility. The 'RR1' is based on the collateral package and other protections that are expected to provide full recovery in the event of a bankruptcy filing. HERTZ CORP: Parent Plans Initial Public Offering of Common Stock ---------------------------------------------------------------- Hertz Global Holdings Inc., the indirect parent corporation of The Hertz Corporation, filed a Registration Statement on Form S-1 with the Securities and Exchange Commission in connection with the initial public offering of its common stock. The securities to be offered in the proposed IPO will include shares to be issued and sold by Hertz Global Holdings as well as shares to be sold by certain current stockholders of Hertz Global Holdings. Hertz Global Holdings intends to use the net proceeds to it from the offering to repay borrowings outstanding under its US$1 billion loan facility entered into on June 30, 2006, with the remainder of the proceeds, if any, to be used for general corporate purposes (which may include the repayment of borrowings outstanding under The Hertz Corporation's senior credit facilities). Goldman, Sachs & Co., Lehman Brothers Inc. and Merrill Lynch & Co. are the joint global coordinators and bookrunners for the offering. Deutsche Bank Securities and JPMorgan are joint bookrunners. Hertz Global Holdings and the selling stockholders will also grant the underwriters an option to purchase additional shares at the initial public offering price. The offering of common stock will be made only by means of a prospectus. When available, a copy of the preliminary prospectus relating to this offering may be obtained from: Goldman, Sachs & Co. Attn: Prospectus Department 85 Broad Street New York, NY 10004 Fax (212) 902-9316 Lehman Brothers Inc. c/o ADP Financial Services Integrated Distribution Services 1155 Long Island Avenue Edgewood, NY 11717 Telephone (631) 254-7106 Merrill Lynch & Co. 4 World Financial Center New York, NY 10080 Telephone (212) 449-1000 About Hertz Corp. Headquartered in Park Ridge, New Jersey, The Hertz Corporation -- http://www.hertz.com/-- is a vehicle renting company that offers a wide variety of current-model cars on a short-term rental basis -- daily, weekly or monthly -- at airports, in downtown and suburban business centers, and in residential areas and resort locales. * * * As reported in the Troubled Company Reporter on July 12, 2006, Standard & Poor's Ratings Services held its ratings on Hertz Corp., including the 'BB-' corporate credit rating, on CreditWatch with negative implications, where they were placed on June 26, 2006. INCO LTD: Increase Falconbridge Merger Offer By CDN$1 Per Share --------------------------------------------------------------- Phelps Dodge Corp., Inco Ltd. and Falconbridge Ltd. took action to improve the terms of their three-way combination. Phelps Dodge increased the cash portion of the consideration to be paid to the shareholders of Inco in the combination of Phelps Dodge and Inco by CDN$2.75 per Inco share. Inco increased the cash portion of its offer to purchase all outstanding common shares of Falconbridge by CDN$1.00 per Falconbridge share, and the Falconbridge board of directors has declared a special cash dividend of CDN$0.75 per Falconbridge common share. Improved Terms of 3-Way Combination Under the improved terms, Phelps Dodge will acquire all outstanding common shares of Inco for a combination of cash and common shares of Phelps Dodge having a value of CDN$80.70 per Inco share, based upon the closing price of Phelps Dodge stock and the closing U.S./Canadian dollar exchange rate on Friday, July 14, 2006. Shareholders of Inco will receive 0.672 shares of Phelps Dodge stock plus CDN$20.25 per share in cash for each share of Inco stock. This represents a premium of 7.8% to Inco's market price as of close of trading on July 14 and a premium of 23.7% to Inco's market price as of the close of trading on June 23, the last trading day before the announcement of the combination of Phelps Dodge, Inco and Falconbridge. Under its enhanced bid for Falconbridge, Inco is now offering CDN$18.50 plus 0.55676 shares of Inco for each share of Falconbridge, assuming full proration of the consideration. With the completion of both transactions, Falconbridge shareholders would receive an implied total consideration on a "look-through" basis of CDN$63.43 per Falconbridge common share, consisting of: (a) C$29.77 in cash; and (b) 0.3741 of a Phelps Dodge Inco Corp. common share (based on the closing price of the Phelps Dodge common shares on the New York Stock Exchange and applicable U.S. Federal Reserve U.S.-Canadian dollar exchange rates on July 14, 2006). Falconbridge Special Dividend In order to further increase the value received by Falconbridge shareholders, the board of Falconbridge declared a special cash dividend of CDN$0.75 per Falconbridge share payable on Aug. 10, 2006, to common shareholders of record at the close of business on July 26, 2006. The Falconbridge board also unanimously determined that Inco's amended offer for the shares of Falconbridge is superior to the unsolicited offer by Xstrata and unanimously recommends that Falconbridge shareholders accept the Inco offer. Reduction in Minimum Tender Condition In addition, Inco reduced the minimum condition in its offer for Falconbridge from two thirds of the outstanding shares of Falconbridge to 50.01% of outstanding shares on a fully diluted basis. Phelps Dodge and Inco also amended their Combination Agreement so that the combination of Phelps Dodge and Inco may be consummated before the acquisition by Inco of 100% of Falconbridge. Inco's amended offer for Falconbridge will expire on July 27, 2006. As part of the transaction, Phelps Dodge expects to repurchase up to US$5 billion of its shares in the 12 months after closing. "We strongly believe the combination of Phelps Dodge, Inco and Falconbridge represents a unique value-creation opportunity for the shareholders of all three companies," J. Steven Whisler, chairman and chief executive officer of Phelps Dodge, said. "There's no question that the value of the enhanced Inco offer for Falconbridge is superior to the unsolicited offer by Xstrata. In addition to the value inherent in the offer, the Falconbridge shareholders will have the ability to participate in the upside resulting from the three-way combination through their ownership of almost 30% of the combined company, which includes a 30% share in the US$900 million of expected annual synergies, which in total have a net present value of US$5.8 billion." "[The] actions demonstrate our shared commitment to create the leading North American-based mining company and a global powerhouse in copper and nickel," Scott Hand, chairman and chief executive officer of Inco, said. "That's great news for our shareholders, for our employees, for our communities and for Canada." "We are pleased with the actions taken today by Phelps Dodge and Inco and by their affirmation of the value of Falconbridge," Derek Pannell, chief executive officer of Falconbridge, said. "The special dividend declared by our board further enhances the expected return to our shareholders. We are confident our shareholders will see the value in the combination of these three companies to create Phelps Dodge Inco." All required regulatory approvals for Inco's acquisition of Falconbridge have been received. Phelps Dodge's offer to acquire Inco is expected to close in September, subject to Phelps Dodge and Inco shareholder approval, regulatory approvals and customary closing conditions. About Phelps Dodge Phelps Dodge Corp. -- http://www.phelpsdodge.com/-- produces copper and molybdenum and is the largest producer of molybdenum- based chemicals and continuous-cast copper rod. The company and its two divisions, Phelps Dodge Mining Co. and Phelps Dodge Industries, employ approximately 15,000 people worldwide. About Falconbridge Headquartered in Toronto, Ontario, Falconbridge Limited (TSX:FAL.LV)(NYSE: FAL) -- http://www.falconbridge.com/-- is a leading copper and nickel company with investments in fully integrated zinc and aluminum assets. Its primary focus is the identification and development of world-class copper and nickel orebodies. It employs 14,500 people at its operations and offices in 18 countries. The Company owns nickel mines in Canada and the Dominican Republic and operates a refinery and sulfuric acid plant in Norway. It is also a major producer of copper (38% of sales) through its Kidd mine in Canada and its stake in Chile's Collahuasi mine and Lomas Bayas mine. Its other products include cobalt, platinum group metals, and zinc. About Inco Headquartered in Sudbury, Ontario, Inco Limited (TSX, NYSE:N) -- http://www.inco.com/-- is the world's #2 producer of nickel, which is used primarily for manufacturing stainless steel and batteries. Inco also mines and processes copper, gold, cobalt, and platinum group metals. It makes nickel battery materials and nickel foams, flakes, and powders for use in catalysts, electronics, and paints. Sulphuric acid and liquid sulphur dioxide are produced as byproducts. The company's primary mining and processing operations are in Canada, Indonesia, and the U.K. * * * Inco Limited's 3-1/2% Subordinated Convertible Debentures due 2052 carry Moody's Investors Service's Ba1 rating and Standard & Poor's BB+ rating. INDUSTRIAL REPAIR: Creditors Opt to Liquidate Assets ---------------------------------------------------- Creditors of Industrial Repair Services & Supplies Limited opted to liquidate the company's assets on April 21. Subsequently, Clive Morris was appointed Liquidator. The company can be reached at: Industrial Repair Services & Supplies Limited Block 1 Office 24 Walkers Rise Cannock Chase Enterprise Centre Hednesford Cannock Staffordshire WS120QW United Kingdom Tel: 01543 424 746 Fax: 01543 424 762 MANHATTAN PIZZA: Begins Liquidation Procedure --------------------------------------------- The Manhattan Pizza Company Limited is liquidating its assets after creditors resolved to wind up the company on April 26. Michael Robert Fortune and Carl Derek Faulds of Portland Business & Financial Solutions Ltd were appointed Joint Liquidators. The company can be reached at: 13 Kingdom Close Fareham Hampshire PO155TJ United Kingdom Tel: 01489 886 622 MELLORSONS MANUFACTURING: Names Eileen T. F. Sale Liquidator ------------------------------------------------------------ Eileen T. F. Sale of Sale Smith & Co. Limited was appointed Liquidator of Mellorsons Manufacturing Limited after creditors passed a resolution to wind up the company on April 19. The company can be reached at: Mellorsons Manufacturing Limited George Street West Bromwich West Midlands B70 6NH United Kingdom Tel: 0121 580 0520 Fax: 0121 580 0521 MONACTIVE LIMITED: Hires Administrators from Baker Tilly -------------------------------------------------------- Graham Paul Bushby and Guy Edward Brooke Mander of Baker Tilly were appointed joint administrators of Monactive Limited (Company Number 03544763) on June 16. Headquartered in Birmingham, Baker Tilly -- http://www.bakertilly.co.uk/-- is a leading independent firm of chartered accountants and business advisers in the United Kingdom. The firm's annual fee income is over GBP168 million and is part of a global network, which has 122 member firms in 85 countries as an independent member of Baker Tilly International. Headquartered in Reading, United Kingdom, Monactive Limited is engaged in software consultancy and supply. O'SULLIVAN INDUSTRIES: Sells United Kingdom Business Operations --------------------------------------------------------------- In a regulatory filing with the U.S. Securities and Exchange Commission, Rick A. Walters, president and chief executive officer of O'Sullivan Industries Holdings Inc. reports that, effective June 30, 2006, the company conveyed substantially all of the assets of its United Kingdom sales and distribution office to a company formed by the former manager of the office. The purchasing company assumed certain of the liabilities of the U.K. sales and distribution office as consideration. The purchasing company also entered into a distributorship agreement with O'Sullivan Industries to provide for continued sales and service in the United Kingdom, the remainder of Europe, the Middle East and Africa. Mr. Walters states that in connection with the sale of the U.K. operations, O'Sullivan Industries expects to record a non-cash charge of US$1,600,000. The major components of the charge are expected to be: Accounts receivable US$1,600,000 Inventory 300,000 Prepaid assets 700,000 Others 400,000 Liabilities assumed (1,400,000) "We expect that this transaction will have an positive effect on our earnings commencing with the first quarter of fiscal 2007," Mr. Walters relates. Headquartered in Roswell, Georgia, O'Sullivan Industries Holdings, Inc. -- http://www.osullivan.com/-- designs, manufactures, and distributes ready-to-assemble furniture and related products, including desks, computer work centers, bookcases, filing cabinets, home entertainment centers, commercial furniture, garage storage units, television, audio, and night stands, dressers, and bedroom pieces. O'Sullivan sells its products primarily to large retailers including OfficeMax, Lowe's, Wal-Mart, Staples, and Office Depot. The Company and its subsidiaries filed for chapter 11 protection on Oct. 14, 2005 (Bankr. N.D. Ga. Case No. 05-83049). Joel H. Levitin, Esq., at Dechert LLP, represents the Debtors. Michael H. Goldstein, Esq., Eric D. Winston, Esq., and Christine M. Pajak, Esq., at Stutman, Treister & Glatt, P.C., represent the Official Committee of Unsecured Creditors. On Sept. 30, 2005, the Debtor listed US$161,335,000 in assets and US$254,178,000 in debts. (O'Sullivan Bankruptcy News, Issue No. 20; Bankruptcy Creditors' Service, Inc., 215/945-7000) QUIGLEY UNITED: Creditors' Meeting Slated for July 21 ----------------------------------------------------- Creditors of Quigley United Kingdom Limited (Company Number 04482632) will meet at 2:30 p.m. on July 21 at: Unity Business Services LLP Unity House Clive Street Bolton BL1 1ET United Kingdom Creditors who want to be represented at the meeting may appoint proxies. Proxy forms must be submitted together with written debt claims at 12:00 noon, on July 20 at: M.C. Bowker and S. Payne Joint Administrators Unity Business Services LLP Unity House Clive Street Bolton Lancashire BL1 1ET United Kingdom Tel: 01204 395000 Fax: 01204 383999 E-mail: matthewbowker@ubsg.co.uk RICHARD GUEST: Names Andrew Clay as Administrator ------------------------------------------------- Andrew T. Clay of Andrew Michaels & Co Ltd was named administrator of Richard Guest Racing Limited (Company Number 04554529) on June 12. The administrator can be contacted at: Andrew Michaels & Co. Ltd Concept House Brooke Street Cleckheaton Bradford BD19 3RY United Kingdom Tel: 0870 750 5411 Fax: 0870 750 5412 E-mail: info@andrew-michaels.com Richard Guest Racing Limited can be reached at: 3 Kensington Bishop Auckland County Durham DL14 6HX United Kingdom SHAW GROUP: Incurs US$16.7 Million Net Loss in Third Quarter ------------------------------------------------------------ The Shaw Group Inc. filed its financial results for the third quarter ended March 31, 2006, to the U.S. Securities and Exchange Commission on July 10. For the three months ended March 31, 2006, the Company incurred a US$16.7 million net loss on US$1.2 billion of net revenues, compared to a US$21.7 million net loss on US$891 million of net revenues in 2005. As of May 31, 2006, the Company had cash and cash equivalents of US$137.3 million, which included US$19.7 million of restricted and escrowed cash, and US$155.5 million of availability under our US$750.0 million Credit Facility to fund operations. A full-text copy of the Company's Quarterly Report is available for free at http://researcharchives.com/t/s?db4 The Shaw Group Inc. -- http://www.shawgrp.com/-- is a global provider of technology, engineering, procurement, construction, maintenance, fabrication, manufacturing, consulting, remediation, and facilities management services for government and private sector clients in the energy, chemical, environmental, infrastructure and emergency response markets. Headquartered in Baton Rouge, Louisiana, with over US$3 billion in annual revenues, Shaw employs approximately 20,000 people at its offices and operations in North America, South America, Europe, the Middle East and the Asia-Pacific region. The company's credit rating carries Standard & Poor's BB rating. That rating was assigned July 27, 2005. SIGHT & SOUND: Creditors' Meeting Slated for July 24 ---------------------------------------------------- Creditors of Sight & Sound Security Services Limited (Company Number 02978629) will meet at 11:00 a.m. on July 24 at: The Croft Hotel Canterbury Road Kennington Ashford Kent TN25 4DU United Kingdom Creditors who want to be represented at the meeting may appoint proxies. Proxy forms must be submitted together with written debt claims at 12:00 noon, on July 21 at: Bernard Hoffman and Ian Douglas Yerrill Joint Administrators Gerald Edelman Suite 2 Kent House Station Road Ashford Kent TN23 1PP United Kingdom Tel: 01233 666 280 Fax: 01233 666 281 Gerald Edelman -- http://www.geraldedelman.com/-- is registered to carry on audit work by the Institute of Chartered Accountants in England and Wales and is authorized and regulated by the Financial Services Authority. Gerald Edelman Financial Solutions Ltd is an appointed representative of Independent Solutions Group Ltd who is regulated by the Financial Services Authority. SOLO CUP: Susan Marks Resigns as Chief Financial Officer -------------------------------------------------------- Solo Cup Company disclosed that Executive Vice President and Chief Financial Officer Susan H. Marks decided to leave the company, effective July 11, to pursue other interests. The Company disclosed that it has engaged Heidrick & Struggles International, Inc., an executive search firm, to undertake a nationwide search for Ms. Marks' successor. "On an interim basis, we are fortunate to have an experienced and capable accounting and finance department within the company to facilitate a smooth transition upon the appointment of a new CFO," Robert Korzenski, president and chief operating officer said. Headquartered in Highland Park, Illinois, Solo Cup Company -- http://www.solocup.com/-- manufactures disposable foodservice products for the consumer and retail, foodservice, packaging, and international markets. Solo Cup has broad expertise in plastic, paper, and foam disposables and creates brand name products under the Solo, Sweetheart, Fonda, and Hoffmaster names. The Company was established in 1936 and has a global presence with facilities in Asia, Canada, Europe, Mexico, Panama and the United States. * * * As reported in the Troubled Company Reporter on Apr. 4, Moody's Investors Service assigned ratings on Solo Cup Company's US$80 million senior secured second lien term loan due 2012 at B3; US$150 million senior secured revolving credit facility maturing Feb. 27, 2010, at B2; US$638 million senior secured term loan B due Feb. 27, 2011, at B2; US$325 million 8.5% senior subordinated notes due Feb. 15, 2014, at Caa1; and Corporate Family Rating at B2. SPECTRUM YARN: Appoints Tenon Recovery as Administrators -------------------------------------------------------- Patrick Ellward and Dilip Dattani of Tenon Recovery were appointed joint administrators of Spectrum Yarn Dyers (U.K.) Ltd. (Company Number 04698227) on June 19. Tenon Recovery -- http://www.tenongroup.com/-- provides accounting and business advice to owner-managed and private business. Spectrum Yarn Dyers (U.K.) Ltd can be reached at: Hanging Bridge Mills Ashbourne Derbyshire DE6 2EA United Kingdom TALKWORLD ONLINE: Joint Liquidators Take Over Operations -------------------------------------------------------- G. Mummery and P. Atkinson of Vantis Redhead French were appointed Joint Liquidators of Talkworld Online Limited after creditors proved the company could no longer continue its operations due to liabilities. The company can be reached at: Talkworld Online Limited 153 High Street Brentwood Essex CM144SD United Kingdom Tel: 01277 261 700 THINKING FOOD: Calls In Begbies Traynor as Administrators --------------------------------------------------------- Paul Michael Davis and Timothy John Edward Dolder of Begbies Traynor (South) LLP were appointed joint administrators of Thinking Food International (Biggin Hill) Limited (Company Number 05249554) on June 16. Headquartered in Manchester, Begbies Traynor -- http://www.begbies.com/-- assists companies, creditors, financial institutions and individuals on all aspects of financial restructuring and corporate recovery. Headquartered in London, United Kingdom, Thinking Food International (Biggin Hill) Limited is engaged in inflight catering. VACUUMATIC LIMITED: Bank of Scotland Appoints PwC Receivers ----------------------------------------------------------- Bank of Scotland appointed Stephen Mark Oldfield and David Matthew Hammond of PricewaterhouseCoopers LLP joint administrative receivers of Vacuumatic Limited (Company Number 01327078) on June 23. PricewaterhouseCoopers LLP -- http://www.pwcglobal.com/-- provides, among others, auditing services, accounting advice, tax compliance and consulting, financial consulting and advisory services to clients in a variety of industries. Headquartered in Colchester, England, Vacuumatic Limited -- http://www.vacuumatic.com/-- manufactures paper sheet counting machines, batching and tabbing equipments and other general machinery. * Moody's Notes Filing's Effect on Eurotunnel's Guarantors ---------------------------------------------------------- Moody's Investors Service commented on the limited effect of a possible bankruptcy of Eurotunnel on the credit profile of the financial guaranty insurance companies with exposure to the firm, despite some substantial exposures to the tunnel operator. The insurance financial strength ratings and outlooks the guarantors are unlikely to be negatively affected by a Eurotunnel bankruptcy given our current expectations for limited ultimate losses on their guarantees, coupled with their strong liquidity positions should there be claims in the event of a bankruptcy-related debt service moratorium. Eurotunnel, is a group of companies owned by Eurotunnel PLC of the U.K. and Eurotunnel S.A. of France, with a concession to operate and maintain two railway tunnels and a service tunnel between the southeast coast of England and the northeast coast of France, and to collect tolls for the provision of cross channel rail services until 2086. Eurotunnel has had financial problems from its inception with significant construction cost overruns and lower traffic than projected. Management and its senior creditors recently agreed to a restructuring plan, although it met strong opposition from junior creditors who proposed an alternative plan. As no consensus was reached between the two creditor groups and Eurotunnel's management, the firm made a request for bankruptcy proceedings, "procedure de sauvegarde," under French law. A ruling is expected before the end of July 2006, possibly leaving creditors some time to reassess their positions. Eurotunnel indicated that it could withdraw its request if a consensus is reached for a restructuring plan. The guarantors wrap approximately US$2.2 billion of Eurotunnel's total debt of GBP6.2 billion (US$11.3 billion). MBIA is the guarantor with the most substantial exposure at US$1.37 billion net of reinsurance (US$1.97 billion, gross), followed by Ambac at US$349 million, Assured Guaranty at US$198 million, and RAM Re at US$63 million. Moody's commented that the guarantors' exposures are quite senior in Eurotunnel's debt structure and that, even under conservative stress scenarios, ultimate losses for the guarantors would likely be a small fraction of their exposure, should they occur at all. Any such losses should be manageable given the guarantors' significant financial resources and capital positions. The rating agency added that a possible bankruptcy of Eurotunnel raises the potential for a debt service moratorium by the firm, exposing the guarantors to potential claims payments until the ultimate occurrence of a debt restructuring. The guarantors have ample liquidity to pay such possible claims and, in some instances, benefit from dedicated reserves or lines of credit to meet debt service requirements. Moody's recognizes that the situation is evolving and will continue to monitor events as they unfold. The rating agency intends to publish a brief Special Comment that will provide more detail about its current assessment of risks presented by Eurotunnel to the guarantors. * Fitch Says Eurotunnel Won't Affect Guarantors' Ratings -------------------------------------------------------- Fitch Ratings has been monitoring the developments of Eurotunnel Group for the past several years, given several financial guarantors' sizeable exposure to this high-profile credit, led by MBIA Insurance Corp. Given the financial debt burden and marginal financial performance of Eurotunnel, there had been a distinct possibility that Eurotunnel's management would file for insolvency protection at some juncture. On July 12, the company's management said it would be pursuing legal proceedings to place itself under the protection of the Commercial Court of Paris pursuant to the Frencch law 'procedure de sauvegarde'. Depending upon the ruling of the court, it is possible that there could be a suspension of debt service payments by Eurotunnel in the near term. Insured Eurotunnel Exposure*/(US$ Mil)/Gross Par/Net Par -- MBIA Insurance Corp. 1,960.5 /1,394.4; -- Ambac Assurance Corp. 349.8 / 349.8; -- Assured Guaranty Ltd. 198.3 / 198.3; Total 2,508.6 / 1,942.5 Despite the size of the exposure to Eurotunnel, Fitch does not foresee any changes to the insurer financial strength ratings of the companies exposed to this credit, as the potential downside scenarios of this troubled credit have been fully considered in the rating process. Fitch is comforted by the relative position the financial guarantors maintain in Eurotunnel's capital structure. The financial guarantors have no exposure to debt of Eurotunnel below Tier 3, and the financial guarantors' only exposure to Tier 3 debt is indirectly via the collateral debt portfolio of Fixed-Link Finance B.V. Actually about US$1.7 billion of the above US$1.9 billion net par exposure represents exposure to obligations of FLF1 and Fixed-Link Finance 2 B.V. Both FLF1 and FLF2 are special purpose vehicles that hold debt issued by Eurotunnel. The FLF1 vehicle holds a mix of Tier 1, 2 and 3 Eurotunnel debt, and FLF2 holds only Tier 1A debt -- which ranks pari passu in seniority with Tier 1. The FLF1 financing structure contains a liquidity facility that will cushion the financial guarantors from incurring debt service claims on FLF1's insured debt for a period of time following any interruption of debt service payments by Eurotunnel. On the other hand, the FLF2 vehicle does not maintain a third-party liquidity facility, which is expected to result in sizeable liquidity claims for the affected financial guarantors upon cessation of debt service payments by Eurotunnel. Because the financial guarantors' exposure is relatively senior, and because of the central role the financial guarantors have in the restructuring negotiations, Fitch does not currently expect either interim developments or ultimate resolution of this Eurotunnel restructuring to have a material adverse impact on the financial condition of the affected financial guarantors, despite the sizeable amount of net par exposure. That said, given the recent filing, liquidity claims have become an increased possibility, particularly on non-FLF1 exposures, however a very high rate of recovery of these claims is ultimately anticipated down the line. Given the various constituencies involved in Eurotunnel's credit, Fitch believes the restructuring process could become protracted and remain contentious and, if this is the case, resolution of this exposure will likely require further significant management time and resources on the part of the financial guarantors, particularly MBIA. Any deterioration in Eurotunnel's financial operation during the restructuring process would be expected to negatively impact the final resolution of the exposures that have been insured. * Large Companies with Insolvent Balance Sheets ----------------------------------------------- Shareholders Total Working Equity Assets Capital Ticker (US$MM) (US$MM) (US$MM) ------ ----------- ------- -------- AUSTRIA ------- Libro AG (111) 174 (182) Rhi AG (214) 1,756 183 BELGIUM ------- City Hotels CITY.BR (7) 210 (15) Real Software REAL.BR (49) 142 (34) Sabena S.A. (86) 2,215 (297) CZECH REPUBLIC -------------- Ceskomoravska Kolben & Danek Praha Holding (89) 192 (2,186) DENMARK ------- Elite Shipping (28) 101 19 FRANCE ------ Acces Industrie (8) 106 (35) Arbel PA.ARB (98) 222 (72) Banque Nationale de Paris Guyane BNPG (41) 352 N.A. BSN Glasspack (101) 1,151 179 Charbo De France (3,872) 4,738 (2,868) Compagnie Francaise de l'Afrique Occidentale (65) 256 21 Compagnies de Machines Bull (139) 137 (6) Dollfus Mieg & Cie S.A. DS (11) 165 (29) Euro Computer System (110) 682 377 Genesys S.A. GNS.PA (15) 136 3 Grande Paroisse S.A. (927) 629 330 Immob Hoteliere (68) 233 29 Labo Dolisos DOLI.PA (28) 110 (33) Matussiere et Forest S.A. MTF (78) 294 (28) Metaleurop S.A. PA.PA (24) 181 (30) Oeneo S.A. SABT.PA (12) 292 38 Pneumatiques Kleber S.A. (34) 480 139 SDR Centrest (132) 252 N.A. SDR Picardie (135) 413 N.A. Soderag (3) 404 N.A. Sofal S.A. (305) 6,619 N.A. Spie-Batignolles (16) 5,281 75 St Fiacre (FIN) (1) 111 (33) Teamlog TLO (19) 109 (3) Trouvay Cauvin (0) 134 10 Usines Chausson (23) 249 35 GERMANY ------- Cognis Deutschland GmbH & Co. KG (102) 3,409 (503) Dortmunder Actien-Brauerei DABG (13) 118 (29) EM.TV AG EV4G.BE (22) 849 15 F.A. Guenther & Son AG GUSG (8) 111 N.A. Kaufring AG KAUG (19) 151 (51) Maternus Kliniken AG MAK.F (3) 207 (30) Nordsee AG (8) 195 (31) Primacom AG PRIG (268) 1,257 (1,048) Rinol AG RLIG (64) 104 (15) Schaltbau Hold SLTG (23) 144 (7) Senator Entertainment AG SENGk.BE (153) 126 (148) SinnLeffers AG WHGG (4) 454 (145) Spar Handels- AG SPAG (442) 1,433 (234) Vivanco Gruppe (55) 131 (31) HUNGARY ------- NABI Rt. NABHY (2) 229 (8,950) ICELAND ------- Decode Genetics Inc. DCGN (9) 229 141 ITALY ----- Binda S.p.A. BND (11) 129 (20) Cirio Finanziaria S.p.A. (422) 1,583 (396) Credito Fondiario e Industriale S.p.A. (200) 4,218 N.A. Finpart S.p.A. (152) 732 (322) Gruppo Coin S.p.A. GC (150) 4,218 N.A. I Viaggi del Ventaglio S.p.A. VVE.MI (61) 487 (58) Olcese S.p.A. OLCI.MI (13) 180 (64) Parmalat Finanziaria S.p.A. (18,419) 4,121 (12,481) Technodiffusione Italia S.p.A. TDIFF.PK (90) 152 (24) NETHERLANDS ----------- Baan Company N.V. BAAN (8) 610 46 United Pan-Euro Air UPC (5,266) 5,180 (8,730) NORWAY ------ Petroleum-Geo Services PGO (32) 2,963 (5,250) POLAND ------ Mostostal Zabrze MECOF.PK (6) 227 (366) ROMANIA ------- Oltchim RM Valce OLT (45) 232 321) RUSSIA ------ OAO Samaraneftegas (332) 892 (16,942) Zil Auto (168) 409 (10,680) SPAIN ----- Altos Hornos de Vizcaya S.A. (116) 1,283 (278) Santana Motor S.A. (46) 223 41 Sniace S.A. (16) 136 (34) SWITZERLAND ----------- Wedins Skor Accessoarer AB (10) 139 (129) TURKEY ------ Nergis Holding (24) 125 26 Yasarbank (948) 623 N.A. UNITED KINGDOM -------------- Abbott Mead Vickers (2) 168 (16) AEA Technology Plc AAT.L (24) 340 (50) Alldays Plc (120) 252 (202) Amey Plc (49) 932 (47) Anker PLC ANK.L (22) 115 13 Bonded Coach Holiday Group Plc (6) 188 (44) Blenheim Group (153) 198 (34) Booker Plc BKRUY (60) 1,298 (8) Bradstock Group BDK (2) 269 5 Brent Walker Group BWL (1,774) 867 (1,157) British Energy Plc BGY (5,823) 4,921 434 British Nuclear Fuels Plc (4,248) 40,326 977 British Sky Broadcasting Group Plc BSY (61) 4,157 139 Compass Group CPG (668) 2,972 (298) Costain Group COST (39) 567 (5) Danka Bus System DNK.L (108) 540 34 Dawson Holdings DWN.L (12) 158 (19) Easynet Group ESY.L (45) 323 38 Electrical and Music Industries Group EMI (1,411) 3,235 (331) Euromoney Institutional Investor Plc ERM.L (88) 297 (56) European Home Retail Plc EHRL (14) 111 (37) Gartland Whalley (11) 145 (8) Global Green Tech Group (156) 408 (18) Gondola Holdings Plc GND.L (239) 987 (396) Heath Lambert Fenchurch Group Plc (10) 4,109 (10) HMV Group Plc HMV (9) 875 (190) Homestyle Group Plc HME (29) 409 (124) Imperial Chemical Industries Plc ICI (835) 8,881 (49) Invensys PLC (963) 4,861 913 IPC Media Ltd. (685) 254 16 Jarvis Plc JRVS.L (683) 492 (371) Lambert Fenchurch Group (1) 1,827 3 Lattice Group (1,290) 12,410 (1,228) Leeds United LDSUF.PK (73) 144 (29) M 2003 Plc (2,204) 7,205 (756) Manchester City (17) 154 (21) Micro Focus International Plc MCRO.L (14) 115 (11) Misys Plc MSY (460) 906 60 Mytravel Group MT.L (283) 1,159 (410) Orange Plc ORNGF (594) 2,902 7 Park Group Plc PKG.L (5) 111 (13) Partygaming Plc PRTY (46) 398 (110) Premier Foods Plc PFD.L (31) 1,475 16 Probus Estates Plc PBE.L (28) 113 (49) Regus Plc RGU.L (46) 367 (60) Rentokil Initial Plc RTO (1,134) 2,678 (45) RHM Plc RHM (586) 2,411 59 Saatchi & Saatchi SSI (119) 705 (41) Seton Healthcare (11) 157 0 SFI Group (108) 178 (162) Telewest Communications Plc TLWT (3,702) 7,581 (5,361) UK Coal Plc UKC (25) 865 (62) Virgin Mobile Holdings Plc VMOB.L (101) 278 (80) Each Tuesday edition of the TCR-Europe contains a list of companies with insolvent balance sheets based on the latest publicly available balance sheet available to our editors at the time of publication. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. ********* 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 -- Europe is a daily newsletter co- published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland USA. Jazel Laureno, Julybien Atadero, Carmel Paderog, and Joy Agravante, Editors. Copyright 2006. All rights reserved. ISSN 1529-2754. 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 Europe subscription rate is US$575 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 Christopher Beard at 240/629-3300. * * * End of Transmission * * *