/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/081008.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 Wednesday, October 8, 2008, Vol. 9, No. 200 Headlines A U S T R I A ILEANA SCHNELL: Claims Registration Period Ends October 24 L & P SYSTEMGASTRONOMIE: Claims Registration Ends October 24 MASTER SPORT: Claims Registration Period Ends October 24 F R A N C E NIGHTINGALE FINANCE: S&P Keeps Junk Income Notes Rtng on WatchNeg TEREOS EUROPE: Moody's Cuts Corporate Family Rating to Ba3 * FRANCE: Prime Minister Vows to Keep Large Banks from Bankruptcy G E R M A N Y ARBEITSVERMITTLUNG UND FORTBILDUNG: Claims Filing Ends Oct. 14 BAHR IMMOBILIEN: Creditors' Meeting Slated for October 14 CITY SECURITY: Creditors' Meeting Slated for October 14 P & G IM- UND EXPORT: Claims Registration Period Ends Oct. 11 XYZ ERSATZTEILE: Claims Registration Period Ends October 10 I R E L A N D BANTRY BAY: S&P Lowers Ratings on Five Note Classes to CC CAPPOQUIN CHICKENS: Sold to Two Investors from Britain DUNNE HOTELS: High Court Appoints Liquidator to Three Hotels EAMONN HASSETT: Goes Into Liquidation I T A L Y COMPAGNIE INDUSTRIALI: S&P Cuts Corp. Credit Ratings to 'BB+/B' MICRON TECHNOLOGY: Posts US$344 Mln Net Loss in 4Q Ended Aug. 28 UNICREDIT SPA: To Raise EUR6.6 Bil. to Strengthen Capital Ratios K Y R G Y Z S T A N TECHNO-UG LLC: Creditors Must File Claims by November 12 N E T H E R L A N D S DUTCH MORTGAGE IV: S&P Affirms BB Rating on Class D Notes DUTCH MORTGAGE V: S&P Puts BB-Rated Class D Notes on WatchPos R U S S I A KHORLOVSKIY CHEMICAL: Creditors Must File Claims by October 26 LEKOM-INTEROIL LLC: Creditors Must File Claims by October 26 MACHINE-CONSTRUCTION PLANT: Claims Filing Period Ends by Oct.26 POWER ELECTRONICS: Creditors Must File Claims by November 26 PROF-MET LLC: Creditors Must File Claims by October 26 * MOSCOW OBLAST: Moody's Puts Ba2 Ratings on Review for Downgrade S P A I N RENTA CORP: Wants Creditors to Revise Waiver on EUR500 Mil. Loan S W E D E N FORD MOTOR: Conditions Satisfied for UAW Settlement Deal S W I T Z E R L A N D GENERAL MOTORS: Unable to Meet Demand, Factory to Run Overtime GENERAL MOTORS: Amended GSA and MRA Take Effect GENERAL MOTORS: Exchanges 16MM Shares for Series D Debentures GENERAL MOTORS: CEO Says US & Europe Markets to Remain Weak U K R A I N E APEKS LLC: Creditors Must File Claims by October 11 DIBROVA OJSC: Creditors Must File Claims by October 11 DIV LLC: Creditors Must File Claims by October 11 IKZ HOLDING: Creditors Must File Claims by October 11 PENTKOM LLC: Creditors Must File Claims by October 11 RODOVID BANK: Moody's Puts E+ BFSR on Review for Downgrade U N I T E D K I N G D O M AMERICAN INTERNATIONAL: Sale Can Help Repay Loan, Says UBS Analyst AMERICAN INTERNATIONAL: Discloses 8.4% Equity Stake in eTelecare AMERICAN INTERNATIONAL: Robert Sandler Retires from Firm AMERICAN INTERNATIONAL: Has 33.2% Stake in Transatlantic Holdings AMERICAN INTERNATIONAL: Moody's Cuts Unsecured Debt Rating to 'A3' DGT STEEL: Business Sold to Consortium; 100 Jobs Secured DIOMED HODLINGS: Pays in Full Debt to Hercules Technology EWHURST CONTROL: Brings in Liquidators from Tenon Recovery LEHMAN BROTHERS: High Court Approves Client Asset Claims Process MOTOR WORLD: Calls in Administrators from BDO Stoy Hayward NORTHERN ROCK: Implements Changes to Range of Savings Products STRAKER INTERACTIVE: Appoints Nick Wood as Liquidator WADKIN ULTRACARE: Calls in Liquidators from Mazars WILLIS GAMBIER: Sold to Samson Holdings; 61 Jobs Secured * S&P Issues Report on U.S. Bailout and European Government Summit * Wall Street Crisis Hits Various Banks Across Europe ********* ============= A U S T R I A ============= ILEANA SCHNELL: Claims Registration Period Ends October 24 ---------------------------------------------------------- Creditors owed money by LLC Ileana Schnell Cosmetics have until Oct. 24, 2008, to file written proofs of claim to the court- appointed estate administrator: Dr. Michael Zerobin Herzog-Leopold-Str. 2 2700 Wiener Neustadt Austria Tel: 02622/86472 Fax: 02622/86472-4 E-mail: anwalt@zerobin.at Creditors and other interested parties are encouraged to attend the creditors' meeting at 10:00 a.m. on Nov. 5, 2008, for the examination of claims at: The Land Court of Wiener Neustadt Room 15 Wiener Neustadt Austria Headquartered in Wiener Neudorf, Austria, the Debtor declared bankruptcy on Sept. 17, 2008, (Bankr. Case No. 10 S 88/08g). L & P SYSTEMGASTRONOMIE: Claims Registration Ends October 24 ------------------------------------------------------------ Creditors owed money by LLC L & P Systemgastronomie have until Oct. 24, 2008, to file written proofs of claim to the court- appointed estate administrator: Dr. Franz Krainer Herrengasse 19/III 8010 Graz Tel: 0316/82-20-82 Fax: 0316/82-20-82-75 E-mail: office@dr-krainer.at Creditors and other interested parties are encouraged to attend the creditors' meeting at 10:10 a.m. on Oct. 30, 2008, for the examination of claims at: The Graz Land Court Room 222 Second Floor Graz Austria Headquartered in Graz, Austria, the Debtor declared bankruptcy on Sept. 18, 2008, (Bankr. Case No. 26 S 106/08w). MASTER SPORT: Claims Registration Period Ends October 24 -------------------------------------------------------- Creditors owed money by LLC Master Sport Consulting have until Oct. 24, 2008, to file written proofs of claim to the court- appointed estate administrator: Dr. Heimo Hofstatter, Hofstatter & Kohlfuerst Rechtsanwalte OEG Marburger Kai 47 8010 Graz Austria Tel: 0316/815454 Fax: 0316/815454-22 E-mail: advokat@hofstaetter.co.at Creditors and other interested parties are encouraged to attend the creditors' meeting at 10:00 a.m. on Oct. 30, 2008, for the examination of claims at: The Graz Land Court Room 222 Second Floor Graz Austria Headquartered in Graz, Austria, the Debtor declared bankruptcy on Sept. 12, 2008, (Bankr. Case No. 26 S 104/08a). =========== F R A N C E =========== NIGHTINGALE FINANCE: S&P Keeps Junk Income Notes Rtng on WatchNeg ----------------------------------------------------------------- Standard & Poor's Ratings Services has placed on CreditWatch with negative implications its credit ratings on the senior debt issued by Nightingale Finance Ltd. and Nightingale Finance LLC, two co- issuing structured investment vehicles (SIVs), collectively known as Nightingale. At the same time, S&P placed the issuer credit rating on CreditWatch negative and kept the rating on the income notes on CreditWatch negative. Earlier this year, Nightingale secured 100% support from AIG Financial Products Corp. to cover their senior obligations. Following S&P's rating action on AIG Financial Products, to A- /Watch Neg from A-/Watch Dev on Oct. 3, 2008, S&P is reviewing the support provided to see whether there are any rating implications for Nightingale. Although the ratings on Nightingale could be affirmed if Banque AIG (as manager) puts in place a suitable plan, S&P does not rule out the possibility of lowering the ratings on Nightingale by more than one notch. Nightingale is a SIV structure managed by Banque AIG, which has responsibility for purchasing assets, managing the portfolio, and overseeing the issuance of commercial paper and medium-term notes. Ratings Placed On CreditWatch Negative Nightingale Finance Ltd. And Nightingale Finance LLC Class To From ----- -- ---- ICR AAA/Watch Neg/A-1+ AAA/Negative/A-1+ CP A-1+/Watch Neg A-1+ MTN AAA/Watch Neg AAA Ratings Remaining On CreditWatch Negative Income notes CCC-/Watch Neg TEREOS EUROPE: Moody's Cuts Corporate Family Rating to Ba3 ---------------------------------------------------------- Moody's Investors Service has downgraded Tereos's Corporate Family Rating (CFR) to Ba3 from Ba2 and the senior secured rating of Tereos Europe's EUR500 million bond issue to B1 from Ba3. The rating outlook is negative. "The downgrade of the CFR reflects Moody's concerns that Tereos's leverage in FY2007/2008 will be significantly higher than expected at the time of the initial rating assignment, and that it is unlikely that the company will be able to meet the initially set target credit metrics (i.e. retained cash flow to net debt above 10% and gross debt to EBITDA around 3.5x) over the medium term," says Marika Makela, Analyst in Moody's Corporate Finance Group. The rating action concludes the rating review for possible downgrade that Moody's initiated in July 2008 further to Tereos's communication that its weaker-than-expected performance and higher indebtedness were likely to prevent it from meeting the leverage and interest cover covenants stipulated in its bank facilities. More specifically, Moody's notes that Tereos's operating performance has been suffering from the sugar market conditions in Europe that have remained challenging in FY2007/2008, as well as from certain technical problems at BENP Lillebonne factory. Moody's acknowledges that some of these difficulties were non- recurring in nature and that the market situation in Europe should improve in the next financial year in light of recent amendments to the Sugar Market Reform. "The rating agency nevertheless cautions that operating improvements in FY2008/2009 would need to be significant to offset the company's currently high indebtedness further to the acquisitions of TALFIIE and Andrade (completed in 2007) for Tereos to reach its target credit metrics," adds Ms. Makela. The negative outlook on the ratings reflects Moody's expectation that while Tereos's credit metrics should gradually improve provided there are no further debt-financed acquisitions and given the improving prospects in the European sugar market, the market conditions nevertheless remain uncertain and de-leveraging to levels in line with the Ba3 rating category may take some time. Moody's cautions that further negative rating pressure could evolve on the rating if gross debt to EBITDA remained consistently above 4.5 times. More positively, Moody's notes that Tereos's banks have agreed to amend its senior credit facilities with the result that its covenant levels have been reset for FY2007/2008 (net debt to EBITDA below 4.5 times and EBITDA to net interest above 2.5 times) and FY2008/2009 (net debt to EBITDA below 3.75 times and EBITDA to net interest above 3.5 times). However, Moody's cautions that leeway under the financial covenants may also remain tight in FY2008/2009. From a liquidity point of view, the rating agency notes that Tereos's negotiations with its banks has led to its revolving credit facility amount being reduced to EUR326 million from the previous EUR488 million. Cash balances as of June 2008 amounted to around EUR70 million and there is roughly EUR83 million debt falling due in FY2008/2009. Seasonality in the business is very pronounced, with working capital outflows peaking at EUR320 million in Q2 (January-March) and debt being at a low point at the end of the financial year in September. Moody's cautiously notes that Tereos's liquidity therefore tends to become tight in Q2. Finally, the downgrade of the rating of the EUR500 million notes to B1 reflects the current overall probability of default rating (PDR) of the company, which is at Ba3, and a loss-given-default of LGD-4. The bonds continue to benefit from a downstream guarantee from Tereos -- an entity which accounts for approximately half of the cooperative's consolidated assets and EBITDA - and are secured on a second-ranking pledge over the shares of Tereos's subsidiaries. The senior bank facilities have a first-lien pledge over the shares of Tereos's subsidiaries as well as a security interest on the stock and receivables of Tereos. Moody's further notes the high level of indebtedness at operating subsidiaries, which has increased as a result of the Andrade and TALFIIE acquisitions, and notes that these obligations benefit from their proximity to the operating companies' assets. Headquartered in Lille, France, Tereos was created in 2004 as a result of the merger of Beghin Say and Union SDA, a beet sugar cooperative. In January 2006, the company merged with another French cooperative, Sucreries & Distilleries des Hauts de France (SDHF), creating the second-largest sugar producer in Europe. Tereos also holds a 62% stake in Syral, one of the largest European producers of starch and starch-based sweeteners. Additionally, Tereos is ranked second in this sector in Brazil through Guarani. Tereos is an agro-industrial cooperative group comprising a total of 14,000 growers, or almost half of France's sugar beet producers. Tereos processes its growers' crops -- mainly sugar beet but also sugar cane and cereals -- into consumer and industrial sugars, alcohol and ethanol. * FRANCE: Prime Minister Vows to Keep Large Banks from Bankruptcy ----------------------------------------------------------------- France's Prime Minister Francois Fillon on Sept. 30, 2008, called on Europe to ensure that "no large bank be forced into bankruptcy" by the U.S. financial crisis, Agence France-Presse reported. Noting France's decision along with Belgium and Luxembourg to pump EUR6.4 billion into Dexia SA, Mr. Fillon disclosed in a political meeting that states must "assume their responsibilities," AFP related. The French government had intended to announce new measures to shore up the banking sector, according to AFP. President Nicolas Sarkozy has promised that no savers would be left out of pocket. The world financial crisis, triggered by a collapse in confidence in U.S. banks' debt portfolios, was "the worst the world has known since the 1930s," AFP quoted Mr. Fillon as saying. ============= G E R M A N Y ============= ARBEITSVERMITTLUNG UND FORTBILDUNG: Claims Filing Ends Oct. 14 -------------------------------------------------------------- Creditors of Arbeitsvermittlung und Fortbildung fuer Dienstleistungsberufe GmbH have until Oct. 14, 2008, to register their claims with court-appointed insolvency manager Horst Piepenburg. Creditors and other interested parties are encouraged to attend the meeting at 9:00 a.m. on Nov. 4, 2008, at which time the insolvency manager will present his first report on the insolvency proceedings. The meeting of creditors will be held at: The District Court of Duesseldorf Meeting Hall A 409 Fourth Floor Muehlenstrasse 34 40213 Duesseldorf Germany The Court will also verify the claims set out in the insolvency manager's report during this meeting, while creditors may constitute a creditors' committee or opt to appoint a new insolvency manager. The insolvency manager can be reached at: Horst Piepenburg Heinrich-Heine-Allee 20 40213 Duesseldorf Germany The District Court of Duesseldorf opened bankruptcy proceedings against Arbeitsvermittlung und Fortbildung fuer Dienstleistungsberufe GmbH on Sept. 4, 2008. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be reached at: Arbeitsvermittlung und Fortbildung fuer Dienstleistungsberufe GmbH Markische Strasse 52 40625 Duesseldorf Germany BAHR IMMOBILIEN: Creditors' Meeting Slated for October 14 --------------------------------------------------------- The court-appointed insolvency manager for Bahr Immobilien GmbH, Rolf Nacke will present his first report on the Company's insolvency proceedings at a creditors' meeting at 10:20 a.m. on Oct. 14, 2008. The meeting of creditors and other interested parties will be held at: The District Court of Charlottenburg Hall 218 Second Floor Amtsgerichtsplatz 1 14057 Berlin Germany The Court will also verify the claims set out in the insolvency manager's report at 9:45 a.m. on Feb. 10, 2009, at the same venue. Creditors have until Dec. 15, 2008, to register their claims with the court-appointed insolvency manager. The insolvency manager can be reached at: Rolf Nacke Gross-Berliner Damm 73c 12487 Berlin Germany The District Court of Charlottenburg opened bankruptcy proceedings against Bahr Immobilien GmbH on Sept. 11, 2008. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be reached at: Bahr Immobilien GmbH Treskowallee 116 10318 Berlin Germany CITY SECURITY: Creditors' Meeting Slated for October 14 ------------------------------------------------------- The court-appointed insolvency manager for City Security Service GmbH, Ruediger Wienberg will present his first report on the Company's insolvency proceedings at a creditors' meeting at 11:40 a.m. on Oct. 14, 2008. The meeting of creditors and other interested parties will be held at: The District Court of Charlottenburg Hall 218 Second Floor Amtsgerichtsplatz 1 14057 Berlin Germany The Court will also verify the claims set out in the insolvency manager's report at 12:15 p.m. on Jan. 29, 2009, at the same venue. Creditors have until Nov. 30, 2008, to register their claims with the court-appointed insolvency manager. The insolvency manager can be reached at: Ruediger Wienberg Giesebrechtstr. 1 10629 Berlin Germany The District Court of Charlottenburg opened bankruptcy proceedings against City Security Service GmbH on Aug. 29, 2008. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be reached at: City Security Service GmbH Handjerystr. 60 12161 Berlin Germany P & G IM- UND EXPORT: Claims Registration Period Ends Oct. 11 ------------------------------------------------------------- Creditors of P & G Im- und Export GmbH have until Oct. 11, 2008, to register their claims with court-appointed insolvency manager Carl Christian Binneberg. Creditors and other interested parties are encouraged to attend the meeting at 9:15 a.m. on Nov. 11, 2008, at which time the insolvency manager will present his first report on the insolvency proceedings. The meeting of creditors will be held at: The District Court of Koblenz Hall 111 Main Court Karmeliterstrasse 14 56068 Koblenz Germany The Court will also verify the claims set out in the insolvency manager's report during this meeting, while creditors may constitute a creditors' committee or opt to appoint a new insolvency manager. The insolvency manager can be reached at: Carl Christian Binneberg Am Schuetzenplatz 24 56182 Urbar Germany Tel: 0261/9634958 Fax: 0261/9634959 E-mail: rechtsanwaelte@binneberg.de The District Court of Koblenz opened bankruptcy proceedings against P & G Im- und Export GmbH on June 5, 2008. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be reached at: P & G Im- und Export GmbH Attn: Medi Shirhadaegh, Manager Unit Consult Rechts- und Steuerberatung Roonstrasse 9-11 56068 Koblenz Germany XYZ ERSATZTEILE: Claims Registration Period Ends October 10 ----------------------------------------------------------- Creditors of xyz Ersatzteile Vertriebs GmbH (formerly J.B. Autoteile GmbH) have until Oct. 10, 2008, to register their claims with court-appointed insolvency manager Dr. Thorsten Schleich. Creditors and other interested parties are encouraged to attend the meeting at 11:00 a.m. on Oct. 31, 2008, at which time the insolvency manager will present his first report on the insolvency proceedings. The meeting of creditors will be held at: The District Court of Konstanz Hall 207 Second Floor Main Building Untere Laube 12 78462 Konstanz Germany The Court will also verify the claims set out in the insolvency manager's report during this meeting, while creditors may constitute a creditors' committee or opt to appoint a new insolvency manager. The insolvency manager can be reached at: Dr. Thorsten Schleich Max-Planck-Str. 11 78052 Villingen-Schwenningen Germany The District Court of Konstanz opened bankruptcy proceedings against xyz Ersatzteile Vertriebs GmbH on Aug. 25, 2008. Consequently, all pending proceedings against the company have been automatically stayed. The Debtor can be reached at: xyz Ersatzteile Vertriebs GmbH Attn: Stefan Brandelik, Manager Johann-Georg-Fahr-Str. 1 78244 Gottmadingen Germany ============= I R E L A N D ============= BANTRY BAY: S&P Lowers Ratings on Five Note Classes to CC --------------------------------------------------------- Standard & Poor's Ratings Services has lowered and removed from CreditWatch with negative implications its credit ratings on all class of notes issued by Bantry Bay CDO I PLC. The rating actions reflect further deterioration in the credit quality in the underlying portfolio, as it contains U.S. CDOs of asset-backed securities (ABS) that have been placed on CreditWatch negative and/or have had their ratings lowered. Bantry Bay CDO I closed on May 3, 2007 and is a static collateralized debt obligation (CDO) of CDOs transaction. Bantry Bay CDO I PLC: -- US$250 Million Secured Floating-Rate And Deferrable Floating- Rate Notes Ratings Lowered And Removed From CreditWatch Negative: Class To From ----- -- ---- A-1 CCC- CCC/Watch Neg A-2 CC CCC-/Watch Neg A-3 CC CCC-/Watch Neg B CC CCC-/Watch Neg C CC CCC-/Watch Neg D CC CCC-/Watch Neg CAPPOQUIN CHICKENS: Sold to Two Investors from Britain ------------------------------------------------------ Liquidator Aidan O'Connell of Deloitte has confirmed, in a statement, that Cappoquin Poultry Plant has been sold to Derby Poultry, Irish Times reports. Mr. O'Connell said, "Two private investors, Perwiaz Latif and Zahid Hussain, owners of Derby Poultry in the UK, have taken majority stakes in Cappoquin Poultry Limited, the company formed for the purposes of this acquisition." The company went into liquidation on Sept. 2, 2008 with debts estimated between EUR7 million to EUR8 million, Ann-Marie Foley of Farmers Weekly reports. Cappoquin workers are expected to meet with the trade union in the coming days. Cappoquin Poultry processes 220,000 chickens per week and pays out up to EUR7 million per year in wages. DUNNE HOTELS: High Court Appoints Liquidator to Three Hotels ------------------------------------------------------------ Mr. Justice Barry White of The High court in Dublin has appointed William O'Riordan of PricewaterhouseCoopers as official liquidator to three hotels owned by the Dunne Hotels Group (DG Hotels) including The Clybaun Hotel Ltd. in Galway, Patrick Punches Hotel Ltd. in Limerick and Bar None Ltd., which operates the Woodstock Hotel in Ennis, Co Clare, Aodhan O'Faolain of The Irish Times reports. According to the report, the hotels, which had been in examinership since June, had no prospect of survival. Rossa Fanning BL, for Mr. O'Riordan, said, that of the hotel group's six companies placed into examinership in June, five of them had no prospect of survival as there was "no investment package available", the report discloses. Mr. Fanning, however, asked the court to do nothing in relation to the Ridgepool Hotel in Ballina, Co Mayo, and the Two Mile Inn in Limerick. The Bank of Scotland (Ireland), which is the main secured creditor, is set to appoint a receiver for those two companies, the report notes. Mr. Fanning, the report adds, also asked the court that Mr. O'Riordan be allowed to continue to operate the hotels so that they can honor existing bookings. Meanwhile, the sixth company, Seno Hotel and Property Company Ltd., c/o The Two Mile Inn Hotel, Ennis Road, Co Limerick, will remain in examinership as it had a reasonable prospect of survival, the report states. DG Hotels, the report relates, went into examinership after running out of cash and amassing sizable debts following a fall- off in visitors from the United States. The company blamed the weakening of the US dollar and the strengthening of the euro, and the emergence of cheaper holiday destinations for the decline in the number of American visitors to Ireland. Dunne Hotels Group -- http://www.dghotels.com/-- is owned by Brendan Dunne and Hilda Dunne. In 2006, the hotel group had revenues of more than EUR36 million, while properties were valued at EUR86 million. EAMONN HASSETT: Goes Into Liquidation ------------------------------------- Eamonn Hassett and Co. Ltd., a property developer and builder in Ireland, has gone into liquidation after racking up debts of EUR5.7 million, Barry O'Halloran of The Irish Times reports. The company was wound up at a creditors' meeting on Wednesday, Oct. 1, the report relates. Declan McDonald of Foster McAteer was appointed liquidator. According to the report, the company owes its unsecured creditors, consisting mainly of suppliers, EUR5.69 million but only has EUR1.72 million available to meet these debts. The statement of affairs, however, indicates that the company has enough to pay the EUR13,683 it owes the Revenue and the EUR596,915 it owes AIB, which is subject to a floating charge. Meanwhile, abridged accounts filed by the company show that it has been losing money since 2005, the report notes. Kilkenny Scaffolding, Shannon Valley Civil Engineering and Kennedy Mechanical Electrical are among the creditors going after the company, the report adds. ========= I T A L Y ========= COMPAGNIE INDUSTRIALI: S&P Cuts Corp. Credit Ratings to 'BB+/B' --------------------------------------------------------------- Standard & Poor's Ratings Services has lowered its long and short- term corporate credit ratings on Italy-based holding company CIR- Compagnie Industriali Riunite SpA to 'BB+/B' from 'BBB-/A-3', and all senior unsecured debt ratings to 'BB+'. All ratings remain on CreditWatch with negative implications, where they were placed on Aug. 1, 2008, after the group's announcement of its plans to spin off its non media assets. "The rating action is a first step in an ongoing review conducted since the announcement of the spin-off project, and reflects the credit concerns raised by the company's willingness to undertake such an unexpected, complex, and we think credit negative transaction," said S&P's credit analyst Xavier Buffon. The split remains to be approved by minority shareholders. S&P believes that the existence of this project, which is driven by equity considerations, makes future strategic or financial policy decisions less predictable, which is a negative for creditors. Even if minority shareholders reject the project, therefore, S&P believes that the ratings should no longer be investment grade. If the announced project does not go through, S&P would likely affirm the ratings. If the spin-off transaction does go through, S&P could further lower the corporate credit ratings and the rating on CIR's 2024 bond, by several notches, or alternatively decide to withdraw the ratings, depending in particular on available information. If it goes ahead, the spin-off project would reflect a considerable reduction in the scope and diversity of CIR's asset portfolio, which would effectively shrink to only one asset, a majority stake in Gruppo Editoriale l'Espresso SpA (BBB-/Watch Neg/--), thereby significantly increasing the risk of default. At the same time, the ratings on CIR International's 2009 and 2011 bonds could be withdrawn on a lack of information, as these bonds would be economically part of a new group. MICRON TECHNOLOGY: Posts US$344 Mln Net Loss in 4Q Ended Aug. 28 ---------------------------------------------------------------- Micron Technology, Inc., reported results of operations for its fourth quarter and 2008 fiscal year, which ended Aug. 28, 2008. For the fourth quarter of fiscal 2008, the company posted a net loss of US$344 million, or US$0.45 per diluted share, on net sales of US$1.45 billion. These results include a non-cash charge to cost of goods sold of US$205 million to write down the value of work in process and finished goods inventories of memory products to their estimated market values and the effect of a recovery of US$70 million for price adjustments for NAND products purchased from other suppliers in prior periods. For the 2008 fiscal year, the company posted a net loss of US$1.6 billion, or US$2.10 per diluted share on net sales of US$5.8 billion. The annual results also include the effect of a non-cash charge of US$463 million during the second quarter of fiscal 2008, in accordance with FASB Statement No. 142, "Goodwill and Other Intangible Assets," to write off the carrying value of goodwill previously recognized in the company�s memory segment. Absent the effects of the fourth quarter inventory write-down, the NAND Flash price adjustments and second quarter goodwill write-off, net loss would have been US$209 million, or US$0.27 per diluted share, for the fourth quarter and US$1.02 billion, or US$1.32 per diluted share, for the 2008 fiscal year. In the fourth quarter and for the 2008 fiscal year, the company generated US$243 million and US$1.0 billion, respectively, in cash flows from operating activities and ended the quarter with US$1.4 billion in cash and investments. "The global memory market continues to experience severe oversupply and price degradation, and it remains a challenging period for all of us competing in the industry," said Steve Appleton, Micron Chairman and CEO. "Micron has pursued various initiatives in the past year to drive greater cost efficiencies across our operations and has made significant progress as shown by our cost per bit reductions and the contribution of cash flow from operations to the balance sheet. Consistent with these efforts and in view of market conditions, we are implementing a 20 percent reduction in salary compensation for Micron senior executives, while we continue to diligently work through our business planning process to ensure the competitiveness and long-term success of the company." Sales of memory products in the fourth quarter of fiscal 2008 decreased 4 percent compared to the third quarter. Sales of DRAM products in the fourth quarter of fiscal 2008 decreased slightly compared to the preceding quarter primarily as a result of an approximate 5 percent decrease in gigabit sales. Comparing the same periods for NAND Flash products, sales decreased approximately 10 percent as a result of an approximate 20 percent decrease in the average selling price, partially offset by an approximate 10 percent increase in gigabit sales. Absent the effect of the inventory write-down in the fourth quarter and the NAND Flash price adjustments, the company's gross margin on sales of memory products was slightly positive, with cost of goods sold per gigabit in the fourth quarter decreasing approximately 5 percent and 15 percent for DRAM and NAND Flash products, respectively, compared to the third quarter. Inventories for memory products decreased in the fourth quarter of fiscal 2008 compared to the third quarter partially as a result of the write-down at the end of the fourth quarter. Sales of CMOS image sensors in the fourth quarter of fiscal 2008 increased slightly compared to the third quarter and represented 12 percent of the company's total sales in the fourth quarter. The company's gross margin on sales of imaging products during the fourth quarter decreased to 29 percent compared to 35 percent in the third quarter, primarily due to lower average selling prices. Micron Technology Inc. -- http://www.micron.com/-- (NYSE:MU) provides advanced semiconductor solutions. Through its worldwide operations, Micron manufactures and markets DRAMs, NAND Flash memory, CMOS image sensors, other semiconductor components and memory modules for use in leading-edge computing, consumer, networking and mobile products. The company is headquartered in Boise, Idaho, and has manufacturing facilities in Italy, Scotland, Japan, Puerto Rico and Singapore. * * * Micron Technology Inc. continues to carry 'BB-' corporate credit and senior unsecured debt ratings from Standard & Poor's with negative outlook. S&P affirmed the ratings on April 29, 2008. UNICREDIT SPA: To Raise EUR6.6 Bil. to Strengthen Capital Ratios ---------------------------------------------------------------- UniCredit SpA Board of Directors on Sunday approved measures that would raise up to EUR6.6 billion to significantly reinforce the company's capital position. UniCredit estimates that its Core Tier 1 ratio Basel II (which was 5.7% at the end of June 2008) will reach a level of around 6.7% by year end, compared with its previous target of 6.2%, as a result of the combined effect of the said capital-strengthening action, the implementation of a series of cost-cutting measures, and the execution of other extraordinary transactions currently underway or envisaged. Citing extremely challenging entire financial sector for the past three weeks, UniCredit said the capital target of 6.7% Core Tier 1 at the end of 2008 is based on expected Group net earnings of about EUR5.2 billion, equivalent to approximately EUR0.39 EPS prior to the capital increase. The gap versus the previously announced target of EUR0.52 EPS is attributable both to deteriorated financial markets conditions, which have affected the performance of market-related activities and to the delay in UniCredit assets disposal plan. The capital-strengthening initiatives include: -- Payment of dividends related to 2008 earnings in new shares for an expected aggregate amount of EUR3.6billion; and -- Placement of a EUR3billion issue of Core Tier 1 "Convertible Equity Instruments" ("CASHES" or "instruments") with a group of institutional investors, the size of which will be reduced depending on shareholders� take-up of the rights offering. As the issuance of the new ordinary shares underlying the instruments must be approved at a UniCredit shareholders' meeting and offered to the current shareholders on a pre-emptive basis, the UniCredit Board of Directors resolved to call an extraordinary shareholders� meeting in November 2008, with a view to completing the transaction as soon as practicable within the first quarter 2009, subject to regulatory approvals. In that extraordinary meeting, shareholders will be asked to approve a capital increase of 973 million new ordinary shares at a price of EUR3.083 per share, of which EUR2.583 represents share premium. To the extent that the shareholders exercise their rights to subscribe for such shares, the volume of the CASHES to be issued will be reduced pro-rata. The CASHES are securities that are convertible at the investor�s option into new UniCredit ordinary shares to be issued following receipt of the necessary authorizations. The instruments have been priced with a coupon of 3-month Euribor plus 450bps, in line with terms of recent bank capital financing, and an exchange price fixed at EUR3.083. They will be convertible at any time after 40 days from their issue date and will be automatically converted into UniCredit ordinary shares if the UniCredit share price exceeds 150% of the exchange price (i.e., EUR4.6245) over a set period following the 7th anniversary of their issuance. UniCredit said the instruments offering met a significant level of demand; UniCredit core shareholders and other institutional investors committed to subscribe up to EUR3 billion, of which EUR2 billion already approved by their relevant bodies, while the remaining amount of EUR1 billion is expected to obtain such approval in the forthcoming days. UniCredit Markets & Investment Banking, Mediobanca and Merrill Lynch International advised on the overall capital strengthening measures, on the structuring of the instruments and acted as private placement agents of the CASHES. They also have been mandated to manage the rights offering. Additionally, the company's Board will propose at the shareholders' meeting, the authorization to dispose of the existing treasury shares at market conditions. Unforeseen Consequences Bloomberg News reports that UniCredit hit near an 11-year low on October 6, Monday, after Chief Executive Officer Alessandro Profumo said the bank underestimated the global financial crisis, forcing him to cut profit forecasts and propose raising capital. The report says UniCredit's shares in Milan trading Monday fell as much as 16% to EUR2.59 before closing down 5.5% at EUR2.91, cutting the bank's market value to EUR39 billion (US$53 billion). "We made some mistakes in evaluating the market scenario, that's absolutely clear to us," Bloomberg News quoted Mr. Profumo as saying during a conference call with analysts October 6. "Waves of market turbulence," a deteriorating macroeconomic scenario and "unprecedented lack of trust among financial institutions" led to the need to raise capital. Mr. Profumo added the bank also erred in acquiring several rivals at the "top of the market", Bloomberg News relates. In retrospect "we could have waited," he said, referring to acquisitions in Ukraine, Kazakhstan, Austria and Russia, and the purchase of Capitalia. Still, the bank has no plans to exit any markets, the executive was cited by Bloomberg News as saying. On rumors that he will resign, Mr. Profumo told Bloomberg Television he will "stand by" the bank's employees and management team. S&P Revises Outlook to Negative On October 6, Standard & Poor's Ratings Services revised its outlook on UniCredit SpA to "negative" from "stable" stating that the company's downward revision of earnings expectations reflects the exposure of market-related activities to exceptionally high market volatility as well as the expectation that more severe macroeconomic conditions across the board will constrain profit opportunities. "The negative outlook reflects the uncertainty of sustainable earnings," said Standard & Poor's credit analyst Mr. Buffa di Perrero. According to S&P, UniCredit's business is exposed to economic conditions in Germany, and to volatile Central and Eastern European (CEE) countries. The decision, the rating agency said, more than redresses the situation in which the bank previously found itself, where management had failed to strengthen its just-adequate capital ratios solely through earnings retention. Fitch Changes Outlook to Negative UniCredit disclosed in an October 2 press statement that Fitch Ratings changed to "negative" from "positive" the outlook for UniCredit, for its Italian subsidiaries � UniCredit Banca di Roma Spa, Banco di Sicilia Spa, Bipop Carire Spa and UniCredit Banca per la Casa Spa � and for Germany based HVB, Bank Austria and Bank Pekao in Poland. At the same time, UniCredit's Individual Rating was changed to "B/C" from "B". In its decision on the outlook, Fitch considers that "While the group's profitability has historically been good, its recent performance has been weighed down by lower commissions, reflecting the difficulties in the global asset management sector, and negative results from market operations, in particular the negative marked-to-market valuations on its structured credit portfolio". About UniCredit SpA Headquartered in Milan, Italy, UniCredit SpA -- http://www.unicreditgroup.eu/-- is a holding company of an Italian banking group. The Group is divided into eight divisions: Asset Management, Retail, Central Eastern Europe, Poland's Markets, Corporate, Markets and Investment Banking, Private Banking and Household Banking. Through its network of companies, the Group provides a range of products and services that include traditional banking products, bancassurance, loans, leasing and investment products, which it offers to individuals and households, as well as professionals, small and medium companies and corporations. The Group owns local banks in a number of central-eastern European countries (CEECs), including Poland, Bulgaria, Croatia, Turkey, Slovakia, Romania and the Czech Republic. Unicredit SpA is also present through offices and representatives worldwide in Europe, Asia and the United States. In the fiscal year ended Dec. 31, 2007, UniCredit acquired Capitalia Group. =================== K Y R G Y Z S T A N =================== TECHNO-UG LLC: Creditors Must File Claims by November 12 -------------------------------------------------------- LLC Tecno-Ug has shut down. Creditors have until Nov. 12, 2008, to submit written proofs of claim to: LLC Tecno-Ug Lenin Str. 315 Osh Kyrgyzstan ===================== N E T H E R L A N D S ===================== DUTCH MORTGAGE IV: S&P Affirms BB Rating on Class D Notes --------------------------------------------------------- Standard & Poor's Ratings Services has placed on CreditWatch with positive implications its credit ratings on the subordinate classes of notes issued by Dutch Mortgage Portfolio Loans IV B.V. (DMPL IV) and Dutch Mortgage Portfolio Loans V B.V. (DMPL V). At the same time, S&P affirmed the rating on the class D notes in DMPL IV. The senior class A notes in both transactions remain unaffected by the CreditWatch placements. The CreditWatch placements follow an initial review of the most recent information S&P received for both transactions. This analysis showed that the likelihood of a positive rating action has increased for all the classes S&P placed on reditWatch positive. Levels of credit enhancement available to these notes have improved and the underlying collateral continues to perform well. S&P will now carry out a more detailed loan-level and cash flow analysis to investigate whether any or all of these notes can attain a higher rating. The results of this review and any changes in the ratings are expected in due course. S&P affirmed the class D notes in DMPL IV. S&P has been informed that there will be a correction of interest and principal payments allocated to these notes on the previous two payments dates. Following this correction, S&P will determine whether the notes can be also placed on CreditWatch positive. Dutch Mortgage Portfolio Loans IV B.V. -- EUR1.256 Billion Secured Floating-Rate Mortgage-Backed Notes Ratings Placed On CreditWatch With Positive Implications: Class To From ----- -- ---- B A/Watch Pos A C BBB/Watch Pos BBB Rating Affirmed: D BB Dutch Mortgage Portfolio Loans V B.V. -- EUR1.25 Billion Floating-Rate Mortgage-Backed Notes Ratings Placed On CreditWatch With Positive Implications: Class To From ----- -- ---- B AA-/Watch Pos AA- C BBB/Watch Pos BBB D BB/Watch Pos BB DUTCH MORTGAGE V: S&P Puts BB-Rated Class D Notes on WatchPos ------------------------------------------------------------- Standard & Poor's Ratings Services has placed on CreditWatch with positive implications its credit ratings on the subordinate classes of notes issued by Dutch Mortgage Portfolio Loans IV B.V. (DMPL IV) and Dutch Mortgage Portfolio Loans V B.V. (DMPL V). At the same time, S&P affirmed the rating on the class D notes in DMPL IV. The senior class A notes in both transactions remain unaffected by the CreditWatch placements. The CreditWatch placements follow an initial review of the most recent information S&P received for both transactions. This analysis showed that the likelihood of a positive rating action has increased for all the classes S&P placed on reditWatch positive. Levels of credit enhancement available to these notes have improved and the underlying collateral continues to perform well. S&P will now carry out a more detailed loan-level and cash flow analysis to investigate whether any or all of these notes can attain a higher rating. The results of this review and any changes in the ratings are expected in due course. S&P affirmed the class D notes in DMPL IV. S&P has been informed that there will be a correction of interest and principal payments allocated to these notes on the previous two payments dates. Following this correction, S&P will determine whether the notes can be also placed on CreditWatch positive. Dutch Mortgage Portfolio Loans IV B.V. -- EUR1.256 Billion Secured Floating-Rate Mortgage-Backed Notes Ratings Placed On CreditWatch With Positive Implications: Class To From ----- -- ---- B A/Watch Pos A C BBB/Watch Pos BBB Rating Affirmed: D BB Dutch Mortgage Portfolio Loans V B.V. -- EUR1.25 Billion Floating-Rate Mortgage-Backed Notes Ratings Placed On CreditWatch With Positive Implications: Class To From ----- -- ---- B AA-/Watch Pos AA- C BBB/Watch Pos BBB D BB/Watch Pos BB =========== R U S S I A =========== KHORLOVSKIY CHEMICAL: Creditors Must File Claims by October 26 -------------------------------------------------------------- Creditors of OJSC Khorlovskiy Chemical Plant have until Oct. 26, 2008, to submit proofs of claims to: A. Volodin Temporary Insolvency Manager Post User Box 7 Nikolskoe-Arkhangelskoe Balashinskiy 143956 Moscovskaya Russia The Arbitration Court of Moscow will convene at 10:00 a.m. on Dec. 22, 2008, to hear bankruptcy supervision procedure on the company. The case is docketed under Case No. A41-13475/08. The Court is located at: The Arbitration Court of Moscow Hall 440 Novaya Basmannaya Str. 10 Moscow Russia The Debtor can be reached at: OJSC Khorlovskiy Chemical Plant Sovetskay Str. 108 Khorlovo Voskresenskiy 140215 Moskovskaya Russia LEKOM-INTEROIL LLC: Creditors Must File Claims by October 26 ------------------------------------------------------------ Creditors of LLC Lekom-Interoil (TIN 7706255469, PSRN 1027700355363) have until Oct. 26, 2008, to submit proofs of claims to: V. Pristupa Insolvency Manager 125222 Moscow Russia The Arbitration Court of Moscow commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. A40-9980/08-123-25B. The Court is located at: The Arbitration Court of Moscow Hall 440 Novaya Basmannaya Str. 10 Moscow Russia The Debtor can be reached at: LLC Lekom-Interoil Building 1 Delegatskaya Str. 7 127473 Moscow Russia MACHINE-CONSTRUCTION PLANT: Claims Filing Period Ends by Oct.26 --------------------------------------------------------------- Creditors of OJSC Machine-Construction Plant (TIN 7725044417) have until Oct. 26, 2008, to submit proofs of claims to: P. Novikov Temporary Insolvency Manager Apt. 267 Building 1 Volzhskiy Boulevard 31 109462 Moscow Russia The Arbitration Court of Moscow commenced bankruptcy supervision procedure on the company. The case is docketed under Case No. A40-29906/08-103-91B. The Court is located at: The Arbitration Court of Moscow Hall 773 Novaya Basmannaya Str. 10 Moscow Russia The Debtor can be reached at: OJSC Machine-Construction Plant Building 1 Donskaya Str.4 117049 Moscow Russia POWER ELECTRONICS: Creditors Must File Claims by November 26 ------------------------------------------------------------ Creditors of OJSC Power Electronics Research and Manufacturing Association (TIN 1328902562) have until Nov. 26, 2008, to submit proofs of claims to: P. Poddubnyui Insolvency Manager Ladozhskaya Str. 91/125 440071 Penza Russia The Arbitration Court of Mordovia commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. A39-458/2008-29/6. The Court is located at: The Arbitration Court of Mordovia Kommunisticheskaya Str. 33 Saransk Mordovia The Debtor can be reached at: OJSC Power Electronics Research and Manufacturing Association Gagarina Str. 99a Saransk Mordovia Russia PROF-MET LLC: Creditors Must File Claims by October 26 ------------------------------------------------------ Creditors of LLC Prof-Met have until Oct. 26, 2008, to submit proofs of claims to: F. Galyumov Insolvency Manager Post User Box 167 450105 Ufa Bashkortostan Russia The Arbitration Court of Chelyabinskaya commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. A76-7490/2008-36-66. The Court is located at: The Arbitration Court of Chelyabinsk Vorovskogo Str. 2 454091 Chelyabinsk Russia The Debtor can be reached at: LLC Prof-Met Gagarina Str. 48 454072 Chelyabinsk Russia * MOSCOW OBLAST: Moody's Puts Ba2 Ratings on Review for Downgrade ----------------------------------------------------------------- Moody's Investors Service has placed under review for possible downgrade the Ba2 foreign and local currency ratings of the Oblast of Moscow (Russia). The review follows the recent tightening of financial market conditions in Russia coupled with the Oblast's significant direct and indirect debt repayments to be paid off in next few months. Moody's understands that current credit crunch in Russia has restricted the access to the market for regional and local governments and has led to a substantial increase in the cost of borrowing. Although the Russian federal government has taken numerous measures to address the credit crunch, access to refinancing will likely be hampered by high interest rates in the next few months. Meanwhile, Moscow Oblast has to repay its bank loans of RUR18 billion (US$690 million) in October and December, as well as a few guarantees provided to the local state-owned companies. The rating agency also expects that the Oblast will have to service a part of the non-guaranteed debt of its major companies. Moody's notes that the Oblast's government has accumulated some cash liquidity on its treasury account. However, the Oblast's interest expenses will continue to grow and the debt duration will likely shorten over the medium term, reflecting current market deterioration. These factors coupled with a possible medium term impact of the liquidity crunch on the local economy can exert strong pressure on the Oblast's budgetary performance. "In this regard Moody's notes that the Moscow Oblast's ability to redeem or refinance its principal and interest debt in next three months, avoiding recourse to federal bailout and a significant increase in the interest rate, will be crucial for the Oblast's ratings. Any considerable improvements in market conditions that facilitate access to funding could be also regarded as a positive factor in light of the undertaken rating review," says Alexander Proklov, a Moscow-based Moody's Vice President-Senior Analyst, and lead analyst for this issuer. Moscow Oblast is located in the area surrounding the City of Moscow. With 6.6 million inhabitants, it accounts for 4.5% of the total population of Russia, whereas its contribution to the national GDP is 4% of the total. The region has posted average annual gross regional product (GDP) growth of 7% in 2003-2007. ========= S P A I N ========= RENTA CORP: Wants Creditors to Revise Waiver on EUR500 Mil. Loan ---------------------------------------------------------------- Renta Corporacion Real Estate SA asked creditors on Friday, Oct. 3, 2008, to change the terms of a waiver it won in August on a EUR500 million (US$692.9 million) syndicated loan, Reuters reports. In a statement to the Spanish stock exchange, the company said it wanted "to adjust the covenants and other terms envisaged in the syndicated loan to the exceptional, transitory state of the markets, mainly the financial markets, which have significantly deteriorated since then (August)," the report relates. On Aug. 8, 2008, Renta has reached an agreement with the group of financial institutions making up the syndicated loan, according to which they have granted a long term waiver -� until the end of 2009 �- with respect to certain financial ratios (covenants) specified in the contract, which were set in a very different context from the current market scenario. The parties have agreed to establish new monitoring rules, adjusted and adapted to the current situation, to give the company the necessary operational and financial stability to carry out its day-to-day business. In the context of this new monitoring framework, Renta has committed to a series of commitments, on which the most noteworthy is the reduction of its financial indebtedness to no more than EUR500 million by June 2009, a goal which is fully in line with the strategic policy which the Renta Corporacion group is following. Headquartered in Barcelona, Renta Corporacion Real Estate SA -- http://www.rentacorporacion.com-- is principally engaged in the real estate sector, with interests in the purchase and sale of lands and buildings. The Company is structured in three main areas: Residential, acquisition of residential buildings for refurbishment and sale; Office, acquisition of large urban buildings, usually offices or industrial buildings, for transformation and sale; Land, acquisition of the large-scale property complexes for development and sale. Its major acquisitions are located in Spain (Barcelona, Madrid, Seville, Malaga and Palma de Mallorca), France (Paris), the United Kingdom (London), Germany (Berlin), and the USA (New York). As of the end of fiscal year 2007, the Renta Corporacion Real Estate SA is a part of the group comprised of 22 enterprises. =========== S W E D E N =========== FORD MOTOR: Conditions Satisfied for UAW Settlement Deal -------------------------------------------------------- Ford Motor Co. disclosed in a Securities and Exchange Commission filing that it is updating certain of the guidance provided in its Quarterly Report on Form 10-Q for the period ended June 30, 2008. Due to deteriorating economic conditions and other factors, the company expects that results for its Volvo segment will be worse, instead of improved, in the second half of 2008 compared with the first half of this year. Ford, the UAW, and class representatives of former UAW-represented Ford employees filed a Settlement Agreement with a federal district court in April 2008 relating to retiree health care coverage. The Settlement Agreement provides that a new retiree health care plan, to be funded by a new Voluntary Employee Beneficiary Association trust, would become permanently responsible for providing retiree health care benefits to covered UAW employees and eligible spouses and dependents on the later of December 31, 2009 or final court approval of the Settlement Agreement and Ford's completion of discussions with the Securities and Exchange Commission regarding satisfactory accounting treatment. Ford would fund the New VEBA through a number of sources, including funds that currently existed in voluntary employee beneficiary association trusts, Ford-issued convertible and term notes, and cash on hand. The parties to the Settlement Agreement acknowledged that Ford's obligations to pay into the New VEBA are fixed and capped as provided in the Settlement Agreement and that Ford is not responsible for, and does not provide a guarantee of: (1) the payment for future benefits to plan participants; (2) the asset returns of the funds in the New VEBA; or (3) the sufficiency of assets in the New VEBA to fully pay the obligations of the New VEBA or the New Plan. Effectiveness of the Settlement Agreement was conditioned upon each of these: (1) issuance of a class certification order by the United States District Court for the Eastern District of Michigan that defined the class in the same manner as Class is defined in the Settlement Agreement; (2) Court approval of the Settlement Agreement in a form acceptable to Ford, the UAW and the Class; and (3) successful completion of discussions between Ford and the SEC regarding satisfactory accounting treatment. As of Sept. 30, 2008, each of the conditions has been satisfied, and the period for appeal of Court approval has expired with no appeal having been filed. The company will re-measure its UAW hourly retiree health care obligations, and expect to record a significant curtailment gain in the third quarter of 2008. About Ford Motor Co. Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) -- http://www.ford.com/-- manufactures or distributes automobiles in 200 markets across six continents. With about 260,000 employees and about 100 plants worldwide, the company's core and affiliated automotive brands include Ford, Jaguar, Land Rover, Lincoln, Mercury, Volvo, Aston Martin, and Mazda. The company provides financial services through Ford Motor Credit Company. The company has operations in Japan in the Asia Pacific region. In Europe, the company maintains a presence in Sweden, and the United Kingdom. The company also distributes its brands in various Latin-American regions, including Argentina and Brazil. * * * As reported in the Troubled Company Reporter on Aug. 5, 2008, Fitch Ratings has downgraded the issuer default rating of Ford Motor Company and Ford Motor Credit Company LLC to 'B-' from 'B'. The Rating Outlook remains Negative. The downgrade reflects: the further deterioration in Ford's U.S. sales as a result of economic conditions, an adverse product mix and the most recent jump in gas prices; portfolio deterioration at Ford Credit and heightened concern regarding economic access to capital to support financing requirements; and escalating commodity costs that will remain a significant offset to cost reduction efforts. ===================== S W I T Z E R L A N D ===================== GENERAL MOTORS: Unable to Meet Demand, Factory to Run Overtime -------------------------------------------------------------- Sharon Terlep at Dow Jones Newswires reports that General Motors Corp. said that it will keep its sole U.S. compact-car factory running on overtime for the remainder of this year According to Dow Jones, GM is still unable to meet demand for fuel-efficient small cars. It is running short on Chevrolet Cobalt cars despite adding a third shift at its Lordstown, Ohio, assembly plant, the report says. Dow Jones relates that GM's global sales analyst Mike DiGiovanni said in a conference call on Wednesday, "The increased availability [of Cobalt] is still kind of out in front of us. We're in good shape and we think we'll have adequate availability to sell into that segment, which is a pretty good segment right now." GM won't build new car assembly plants or covert truck factories, and will manage the rising demand by adding shift as existing locations, Dow Jones reports. About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 266,000 people around the world and manufactures cars and trucks in 35 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. GM Europe is based in Zurich, Switzerland, while General Motors Latin America, Africa and Middle East is headquartered in Miramar, Florida. At June 30, 2008, the company's balance sheet showed total assets of US$136.0 billion, total liabilities of US$191.6 billion, and total stockholders' deficit of US$56.9 billion. For the quarter ended June 30, 2008, the company reported a net loss of US$15.4 billion over net sales and revenue of US$38.1 billion, compared to a net income of US$891.0 million over net sales and revenue of US$46.6 billion for the same period last year. GENERAL MOTORS: Amended GSA and MRA Take Effect ----------------------------------------------- General Motors Corporation disclosed in a Securities and Exchange Commission filing that an Amended Global Services Agreement and the Master Restructuring Agreement between the company and Delphi Corporation, as approved by the U.S. Bankruptcy Court for the Southern District of New York on Sept. 26, 2008, became effective on Sept. 29, 2008. A full-text copy of the Amended GSA and MRA is available for free at http://ResearchArchives.com/t/s?3330 About Delphi Corp. Based in Troy, Michigan, Delphi Corporation (PINKSHEETS: DPHIQ) -- http://www.delphi.com/-- is the single supplier of vehicle electronics, transportation components, integrated systems and modules, and other electronic technology. The company's technology and products are present in more than 75 million vehicles on the road worldwide. Delphi has regional headquarters in Japan, Brazil and France. The company filed for Chapter 11 protection on Oct. 8, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP, represent the Official Committee of Unsecured Creditors. As of June 30, 2008, the Debtors' balance sheet showed US$9,162,000,000 in total assets and US$23,742,000,000 in total debts. The Court approved Delphi's First Amended Joint Disclosure Statement and related solicitation procedures for the solicitation of votes on the First Amended Plan on Dec. 20, 2007. The Court confirmed the Debtors' First Amended Plan on Jan. 25, 2008. The Plan has not been consummated after a group led by Appaloosa Management, L.P., backed out from their proposal to provide US$2,550,000,000 in equity financing to Delphi. (Delphi Bankruptcy News, Issue 146; Bankruptcy Creditors' Service Inc., http://bankrupt.com/newsstand/or 215/945-7000) About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 266,000 people around the world and manufactures cars and trucks in 35 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. GM Europe is based in Zurich, Switzerland, while General Motors Latin America, Africa and Middle East is headquartered in Miramar, Florida. At June 30, 2008, the company's balance sheet showed total assets of US$136.0 billion, total liabilities of US$191.6 billion, and total stockholders' deficit of US$56.9 billion. For the quarter ended June 30, 2008, the company reported a net loss of US$15.4 billion over net sales and revenue of US$38.1 billion, compared to a net income of US$891.0 million over net sales and revenue of US$46.6 billion for the same period last year. GENERAL MOTORS: Exchanges 16MM Shares for Series D Debentures ------------------------------------------------------------- General Motors Corporation disclosed in a Securities and Exchange Commission filing that it has issued an aggregate of 16,000,000 shares of its common stock, par value US$1-2/3 per share in exchange for US$176,417,800 principal amount of its 1.50% Series D Convertible Senior Debentures due 2009, beneficially owned by a qualified institutional holder of the Debentures. The Agreement provided that the amount of Common Stock GM exchanged for the Debentures was based on the daily volume weighted average price of the Common Stock on the New York Stock Exchange during a three-day pricing period. GM did not receive any cash proceeds as a result of the exchange of its Common Stock for the Debentures, which Debentures have been retired and cancelled. GM entered into the Agreement to reduce its debt and interest costs, increase its equity and, thereby, improve its liquidity. About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 266,000 people around the world and manufactures cars and trucks in 35 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. GM Europe is based in Zurich, Switzerland, while General Motors Latin America, Africa and Middle East is headquartered in Miramar, Florida. At June 30, 2008, the company's balance sheet showed total assets of US$136.0 billion, total liabilities of US$191.6 billion, and total stockholders' deficit of US$56.9 billion. For the quarter ended June 30, 2008, the company reported a net loss of US$15.4 billion over net sales and revenue of US$38.1 billion, compared to a net income of US$891.0 million over net sales and revenue of US$46.6 billion for the same period last year. GENERAL MOTORS: CEO Says US & Europe Markets to Remain Weak ----------------------------------------------------------- U.S. and Western European markets will remain weak in the first half of 2009, General Motors Corp. CEO Fritz Henderson told reporters at a roundtable discussion at the Paris auto show on Thursday, Oct. 2, according to Reuters. Meanwhile, Mr. Henderson is set to provide details of the Hummer brand to potential buyers this month as to whether there would be a deal or not, Reuters relates. He noted several parties had expressed interest in the brand. About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 266,000 people around the world and manufactures cars and trucks in 35 countries. In 2007, nearly 9.37 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. GM Europe is based in Zurich, Switzerland, while General Motors Latin America, Africa and Middle East is headquartered in Miramar, Florida. At June 30, 2008, the company's balance sheet showed total assets of US$136.0 billion, total liabilities of US$191.6 billion, and total stockholders' deficit of US$56.9 billion. For the quarter ended June 30, 2008, the company reported a net loss of US$15.4 billion over net sales and revenue of US$38.1 billion, compared to a net income of US$891.0 million over net sales and revenue of US$46.6 billion for the same period last year. ============= U K R A I N E ============= APEKS LLC: Creditors Must File Claims by October 11 --------------------------------------------------- Creditors of LLC Building-Investment Company Apeks (code EDRPOU 34294760) have until Oct. 11, 2008, to submit proofs of claim to: The Economic Court of Kiev B. Hmelnitskij Boulevard 44-B 01030 Kiev Ukraine The Economic Court of Kiev commenced the bankruptcy supervision procedure on the company. The case is docketed as 43/423. The Debtor can be reached at: LLC Building-Investment Company Apeks Ap. 15 Konstantinovskaya Str. 54 04071 Kiev Ukraine DIBROVA OJSC: Creditors Must File Claims by October 11 ------------------------------------------------------ Creditors of OJSC Zhashkov Repair Station Subsidiary Company Dibrova (code EDRPOU 05453634) have until Oct. 11, 2008, to submit proofs of claim to: The Economic Court of Cherkassy Shevchenko Avenue 307 18005 Cherkassy Ukraine The Economic Court of Cherkassy commenced bankruptcy proceedings against the company after finding it insolvent on Dec. 6, 2007. The case is docketed as 14/5404. The Debtor can be reached at: OJSC Zhashkov Repair Station Subsidiary Company Dibrova Kuybishev Str. 10 Cherkassy Zhashkov Ukraine DIV LLC: Creditors Must File Claims by October 11 ------------------------------------------------- Creditors of LLC DIV (code EDRPOU 32958372) have until Oct. 11, 2008, to submit proofs of claim to: Finko Andrew Liquidator Ovrazhnaya Str. 29 Donetsk Ukraine The Economic Court of Donetsk commenced bankruptcy proceedings against the company after finding it insolvent on Sept. 1, 2008.The case is docketed as 42/95B. The Economic Court of Donetsk Artema Str. 157 83048 Donetsk Ukraine The Debtor can be reached at: LLC DIV Kuybishev Str. 58 Donetsk Ukraine IKZ HOLDING: Creditors Must File Claims by October 11 ----------------------------------------------------- Creditors of LLC Trading-Production Company IKZ Holding (code EDRPOU 31274558) have until Oct. 11, 2008, to submit proofs of claim to: Fedchuk Bogdan Liquidator Of. 407 Chernovol Avenue 63 79058 Lvov Ukraine The Economic Court of Lvov commenced bankruptcy proceedings against the company after finding it insolvent on Aug. 26, 2008. The case is docketed as 8/102. The Economic Court of Lvov Lichakivska Str. 81 79010 Lvov Ukraine The Debtor can be reached at: LLC Trading-Production Company IKZ Holding Of. 407 Chernovol Avenue 63 79058 Lvov Ukraine PENTKOM LLC: Creditors Must File Claims by October 11 ----------------------------------------------------- Creditors of LLC Pentkom (code EDRPOU 21784247) have until Oct. 11, 2008, to submit proofs of claim to: Zhurba Alexander Liquidator Lesovoy Lane 4 Severodonetsk 93400 Lugansk Ukraine The Economic Court of Lugansk commenced bankruptcy proceedings against the company after finding it insolvent on Aug. 28, 2008. The case is docketed as 12/74b. The Economic Court of Lugansk Geroiv VVV Square 3a 91000 Lugansk Ukraine The Debtor can be reached at: LLC Pentkom Zavodskaya Str. 38 Severodonetsk 93400 Lugansk Ukraine RODOVID BANK: Moody's Puts E+ BFSR on Review for Downgrade ---------------------------------------------------------- Moody's Investors Service has placed on review for possible downgrade Rodovid Bank's E+ bank financial strength rating (BFSR) and B3 long-term local and foreign currency deposit and debt ratings. Moody's has also downgraded the bank's national scale rating (NSR) to Baa3.ua from Baa1.ua. Moody's rating action has been prompted by a weakening of Rodovid Bank's liquidity position under the current stressful market conditions. Rodovid Bank has been historically reliant on short- term corporate deposits and interbank funding, which creates a significant negative asset-liability gap. Moody's believes that, under the market conditions prevailing globally and in Ukraine, Rodovid Bank may have limited resources available to fully refinance its notable short-term maturity gap. According to the bank, some refinancing facilities are available from the National Bank of Ukraine, but the overall volume and timeliness of such funding remain uncertain. Moody's understands that the bank is in negotiations with some of its creditors under interbank and corporate liabilities to extend the tenor of the maturing obligations. Moody's rating review will focus on the situation with regard to Rodovid Bank's liquidity position. Failure to minimise the current short-term liquidity mismatch swiftly through enhancing the bank's liquidity cushion or refinancing its maturing debt could increase Rodovid Bank's liquidity risk further and result in a rating downgrade. With a head office in Kyiv, Ukraine, at end-H1 2008 Rodovid Bank reported total assets of UAH11.99 billion (US$2.47 billion) and net income of UAH54.89 million (US$11.3 million) according to financial statements prepared under the national accounting standards. =========================== U N I T E D K I N G D O M =========================== AMERICAN INTERNATIONAL: Sale Can Help Repay Loan, Says UBS Analyst ------------------------------------------------------------------ The sale of American International Group assets could help repay the US$85 billion loan the company secured from the government, Liam Pleven at The Wall Street Journal reports, citing UBS analyst Andrew Kligerman. AIG's CEO Edward Liddy laid out a plan to sell the company's assets, including all of its domestic life-insurance operations and a part of its foreign life business, to pay off the loan, WSJ relates. As reported in the Troubled Company Reporter on Oct. 6, 2008, AIG will refocus the company on its core property and casualty insurance businesses, generate sufficient liquidity to repay the outstanding balance of its loan and address its capital structure. AIG had drawn US$61 billion on the Federal Reserve Bank of New York credit facility as of Sept. 30, 2008. WSJ relates that so much of AIG is being put on sale that the company should be able to raise substantial sums. The report states that Mr. Kligerman said, "By my calculations, there's more than enough to cover the loan," even given the upheaval in the markets and there is still a pool of buyers "with reasonably high demand." According to WSJ, Mr. Kligerman said that AIG's domestic life- insurance operations alone could fetch US$24 billion. WSJ states that Mr. Liddy will sell American Life Insurance Co., which is in Japan, Europe, and the Middle East, among other places, and other units that sell life insurance in Japan and Taiwan. The report says that the foreign life-insurance operations could be particularly attractive to buyers. Citing Mr. Liddy, WSJ relates that AIG prefers to sell off units to companies with strong brand names, ratings, and balance sheets "because they can be done with speed and you attract larger buyers." Manulife Financial Corp., Prudential Financial Inc., and MetLife Inc., might pursue AIG's offerings, which could earn AIG tens of billions of dollars, WSJ states. Based in New York City, American International Group Inc. -- http://www.aig.com/-- (NYSE: AIG) is an international insurance and financial services organization, with operations in more than 130 countries and jurisdictions. The company is engaged through subsidiaries in General Insurance, Life Insurance & Retirement Services, Financial Services and Asset Management. The company's British headquarters are located on Fenchurch Street in London, continental Europe operations are based in La Defense, Paris, and its Asian HQ is in Hong Kong. AIG owns Ocean Finance, a United Kingdom based company providing home owner loans, mortgages and remortgages. AIG operates in the UK with the brands AIG UK, AIG Life and AIG Direct. It has about 3,000 employees, and sponsors the Manchester United football club. In response to redemption demands, AIG Life (UK) suspended redemptions of its AIG Premier Bond money market fund on Sept. 19, 2008, in order to provide an orderly withdrawal of assets. US$85,000,000,000 Federal Reserve Loan The Federal Reserve Bank of New York extended to AIG a revolving credit facility up to US$85 billion. AIG's borrowings under the revolving credit facility will bear interest, for each day, at a rate per annum equal to three-month Libor plus 8.50%. The revolving credit facility will have a 24-month term and will be secured by a pledge of assets of AIG and various subsidiaries. The Credit Facility provides for a 79.9% equity interest in AIG. The Credit Facility provides for an initial gross commitment fee of 2% of the total Credit Facility on the closing date. AIG, in a regulatory filing with the Securities and Exchange Commission, said it will pay a commitment fee on undrawn amounts at the rate of 8.5% per annum. Interest and the commitment fees are generally payable through an increase in the outstanding balance under the Credit Facility. Borrowings under the Credit Facility are conditioned on the NY Fed being reasonably satisfied with, among other things, AIG's corporate governance. AIG is required to repay the Credit Facility from, among other things, the proceeds of certain asset sales and issuances of debt or equity securities. These mandatory repayments permanently reduce the amount available to be borrowed under the Credit Facility. In a statement, the company said "AIG is a solid company with over US$1 trillion in assets and substantial equity, but it has been recently experiencing serious liquidity issues." Standard & Poor's Ratings Services has revised the CreditWatch status of most of its ratings on the AIG group of companies -- including its 'A-' long-term counterparty credit ratings on American International Group Inc. and International Lease Finance Corp. and the 'A+' counterparty credit and financial strength ratings on most of AIG's insurance operating subsidiaries -- to CreditWatch developing from CreditWatch negative. Fitch Ratings revised its Rating Watch on American International Group, Inc. to Evolving from Negative. Fitch viewed this transaction as a favorable development that alleviates significant near-term liquidity concerns. The Troubled Company Reporter reported on Sept. 19, 2008 that that Edward Liddy replaced Robert Willumstad as AIG's CEO. * * * In a U.S. Securities and Exchange Commission filing dated Aug. 6, 2008, AIG reported a net loss for the second quarter of 2008 of US$5.36 billion compared to 2007 second quarter net income of US$4.28 billion. Second quarter 2008 adjusted net loss was US$1.32 billion, compared to adjusted net income of US$4.63 billion for the second quarter of 2007. The continuation of the weak U.S. housing market and disruption in the credit markets, as well as global equity market volatility, had a substantial adverse effect on AIG's results in the second quarter. Net loss for the first six months of 2008 was US$13.16 billion, compared to net income of US$8.41 billion in the first six months of 2007. Adjusted net loss for the first six months of 2008 was US$4.88 billion, compared to adjusted net income of US$9.02 billion in the first six months of 2007. AMERICAN INTERNATIONAL: Discloses 8.4% Equity Stake in eTelecare ---------------------------------------------------------------- American International Group, Inc., Philippine American Life and General Insurance Company, AIG Life Holdings (International) LLC, American International Reinsurance Company, Ltd., American International Assurance Company (Bermuda) Limited, AIG Global Investment Corp. (Asia) Ltd., AIG Asian Opportunity Fund LP and AIG Asian Opportunity G.P., L.L.C. disclosed in a Securities and Exchange Commission filing that they may be deemed to beneficially own 2,457,832 shares of eTelecare Global Solutions, Inc.'s common stock, representing 8.4% of the shares issued and outstanding. Based in New York City, American International Group Inc. -- http://www.aig.com/-- (NYSE: AIG) is an international insurance and financial services organization, with operations in more than 130 countries and jurisdictions. The company is engaged through subsidiaries in General Insurance, Life Insurance & Retirement Services, Financial Services and Asset Management. The company's British headquarters are located on Fenchurch Street in London, continental Europe operations are based in La Defense, Paris, and its Asian HQ is in Hong Kong. AIG owns Ocean Finance, a United Kingdom based company providing home owner loans, mortgages and remortgages. AIG operates in the UK with the brands AIG UK, AIG Life and AIG Direct. It has about 3,000 employees, and sponsors the Manchester United football club. In response to redemption demands, AIG Life (UK) suspended redemptions of its AIG Premier Bond money market fund on Sept. 19, 2008, in order to provide an orderly withdrawal of assets. The Federal Reserve Bank of New York has extended to AIG a revolving credit facility up to US$85 billion. AIG's borrowings under the revolving credit facility will bear interest, for each day, at a rate per annum equal to three-month Libor plus 8.50%. The revolving credit facility will have a 24-month term and will be secured by a pledge of assets of AIG and various subsidiaries. The revolving credit facility will contain affirmative and negative covenants, including a covenant to pay down the facility with the proceeds of asset sales. The summary of terms also provides for a 79.9% equity interest in AIG. The corporate approvals and formalities necessary to create this equity interest will depend upon its form. In a statement, the company said "AIG is a solid company with over US$1 trillion in assets and substantial equity, but it has been recently experiencing serious liquidity issues." Standard & Poor's Ratings Services has revised the CreditWatch status of most of its ratings on the AIG group of companies -- including its 'A-' long-term counterparty credit ratings on American International Group Inc. and International Lease Finance Corp. and the 'A+' counterparty credit and financial strength ratings on most of AIG's insurance operating subsidiaries -- to CreditWatch developing from CreditWatch negative. Fitch Ratings revised its Rating Watch on American International Group, Inc. to Evolving from Negative. Fitch viewed this transaction as a favorable development that alleviates significant near-term liquidity concerns. The Troubled Company Reporter reported on Sept. 19, 2008, that that Edward Liddy replaced Robert Willumstad as AIG's CEO. * * * In a U.S. Securities and Exchange Commission filing dated Aug. 6, 2008, AIG reported a net loss for the second quarter of 2008 of US$5.36 billion compared to 2007 second quarter net income of US$4.28 billion. Second quarter 2008 adjusted net loss was US$1.32 billion, compared to adjusted net income of US$4.63 billion for the second quarter of 2007. The continuation of the weak U.S. housing market and disruption in the credit markets, as well as global equity market volatility, had a substantial adverse effect on AIG's results in the second quarter. Net loss for the first six months of 2008 was US$13.16 billion, compared to net income of US$8.41 billion in the first six months of 2007. Adjusted net loss for the first six months of 2008 was US$4.88 billion, compared to adjusted net income of US$9.02 billion in the first six months of 2007. AMERICAN INTERNATIONAL: Robert Sandler Retires from Firm -------------------------------------------------------- American International Group, Inc. disclosed in a Securities and Exchange Commission filing that named executive officer Robert M. Sandler has retired from AIG following a change in his position. Mr. Sandler, 66, had been employed by AIG for over 39 years. On Sept. 22, 2008, AIG's retention program became effective. The program applies to approximately 130 executives and consists of cash awards payable 60 percent in December 2008 and 40 percent in December 2009. In connection with Mr. Sandler's retirement, AIG entered into an agreement and release that implements the retirement benefits of AIG's long-term compensation plans and provides the separation pay and other benefits to which AIG executives are entitled under AIG's Executive Severance Plan for terminations without cause. These benefits include a payment of a total of US$2,514,168 in separation pay, payable over two years. Based in New York City, American International Group Inc. -- http://www.aig.com/-- (NYSE: AIG) is an international insurance and financial services organization, with operations in more than 130 countries and jurisdictions. The company is engaged through subsidiaries in General Insurance, Life Insurance & Retirement Services, Financial Services and Asset Management. The company's British headquarters are located on Fenchurch Street in London, continental Europe operations are based in La Defense, Paris, and its Asian HQ is in Hong Kong. AIG owns Ocean Finance, a United Kingdom based company providing home owner loans, mortgages and remortgages. AIG operates in the UK with the brands AIG UK, AIG Life and AIG Direct. It has about 3,000 employees, and sponsors the Manchester United football club. In response to redemption demands, AIG Life (UK) suspended redemptions of its AIG Premier Bond money market fund on Sept. 19, 2008, in order to provide an orderly withdrawal of assets. The Federal Reserve Bank of New York has extended to AIG a revolving credit facility up to US$85 billion. AIG's borrowings under the revolving credit facility will bear interest, for each day, at a rate per annum equal to three-month Libor plus 8.50%. The revolving credit facility will have a 24-month term and will be secured by a pledge of assets of AIG and various subsidiaries. The revolving credit facility will contain affirmative and negative covenants, including a covenant to pay down the facility with the proceeds of asset sales. The summary of terms also provides for a 79.9% equity interest in AIG. The corporate approvals and formalities necessary to create this equity interest will depend upon its form. In a statement, the company said "AIG is a solid company with over US$1 trillion in assets and substantial equity, but it has been recently experiencing serious liquidity issues." Standard & Poor's Ratings Services has revised the CreditWatch status of most of its ratings on the AIG group of companies -- including its 'A-' long-term counterparty credit ratings on American International Group Inc. and International Lease Finance Corp. and the 'A+' counterparty credit and financial strength ratings on most of AIG's insurance operating subsidiaries -- to CreditWatch developing from CreditWatch negative. Fitch Ratings revised its Rating Watch on American International Group, Inc. to Evolving from Negative. Fitch viewed this transaction as a favorable development that alleviates significant near-term liquidity concerns. The Troubled Company Reporter reported on Sept. 19, 2008, that that Edward Liddy replaced Robert Willumstad as AIG's CEO. * * * In a U.S. Securities and Exchange Commission filing dated Aug. 6, 2008, AIG reported a net loss for the second quarter of 2008 of US$5.36 billion compared to 2007 second quarter net income of US$4.28 billion. Second quarter 2008 adjusted net loss was US$1.32 billion, compared to adjusted net income of US$4.63 billion for the second quarter of 2007. The continuation of the weak U.S. housing market and disruption in the credit markets, as well as global equity market volatility, had a substantial adverse effect on AIG's results in the second quarter. Net loss for the first six months of 2008 was US$13.16 billion, compared to net income of US$8.41 billion in the first six months of 2007. Adjusted net loss for the first six months of 2008 was US$4.88 billion, compared to adjusted net income of US$9.02 billion in the first six months of 2007. AMERICAN INTERNATIONAL: Has 33.2% Stake in Transatlantic Holdings ----------------------------------------------------------------- American International Group, Inc., AIG Property Casualty Group, INC., and American Home Assurance Company disclosed in a Securities and Exchange Commission filing that they may be deemed to beneficially own 22,018,973 shares of Transatlantic Holdings, Inc.'s common stock, representing 33.2% of the shares issued and outstanding. Based in New York City, American International Group Inc. -- http://www.aig.com/-- (NYSE: AIG) is an international insurance and financial services organization, with operations in more than 130 countries and jurisdictions. The company is engaged through subsidiaries in General Insurance, Life Insurance & Retirement Services, Financial Services and Asset Management. The company's British headquarters are located on Fenchurch Street in London, continental Europe operations are based in La Defense, Paris, and its Asian HQ is in Hong Kong. AIG owns Ocean Finance, a United Kingdom based company providing home owner loans, mortgages and remortgages. AIG operates in the UK with the brands AIG UK, AIG Life and AIG Direct. It has about 3,000 employees, and sponsors the Manchester United football club. In response to redemption demands, AIG Life (UK) suspended redemptions of its AIG Premier Bond money market fund on Sept. 19, 2008, in order to provide an orderly withdrawal of assets. The Federal Reserve Bank of New York has extended to AIG a revolving credit facility up to US$85 billion. AIG's borrowings under the revolving credit facility will bear interest, for each day, at a rate per annum equal to three-month Libor plus 8.50%. The revolving credit facility will have a 24-month term and will be secured by a pledge of assets of AIG and various subsidiaries. The revolving credit facility will contain affirmative and negative covenants, including a covenant to pay down the facility with the proceeds of asset sales. The summary of terms also provides for a 79.9% equity interest in AIG. The corporate approvals and formalities necessary to create this equity interest will depend upon its form. In a statement, the company said "AIG is a solid company with over US$1 trillion in assets and substantial equity, but it has been recently experiencing serious liquidity issues." Standard & Poor's Ratings Services has revised the CreditWatch status of most of its ratings on the AIG group of companies -- including its 'A-' long-term counterparty credit ratings on American International Group Inc. and International Lease Finance Corp. and the 'A+' counterparty credit and financial strength ratings on most of AIG's insurance operating subsidiaries -- to CreditWatch developing from CreditWatch negative. Fitch Ratings revised its Rating Watch on American International Group, Inc. to Evolving from Negative. Fitch viewed this transaction as a favorable development that alleviates significant near-term liquidity concerns. The Troubled Company Reporter reported on Sept. 19, 2008, that that Edward Liddy replaced Robert Willumstad as AIG's CEO. * * * In a U.S. Securities and Exchange Commission filing dated Aug. 6, 2008, AIG reported a net loss for the second quarter of 2008 of US$5.36 billion compared to 2007 second quarter net income of US$4.28 billion. Second quarter 2008 adjusted net loss was US$1.32 billion, compared to adjusted net income of US$4.63 billion for the second quarter of 2007. The continuation of the weak U.S. housing market and disruption in the credit markets, as well as global equity market volatility, had a substantial adverse effect on AIG's results in the second quarter. Net loss for the first six months of 2008 was US$13.16 billion, compared to net income of US$8.41 billion in the first six months of 2007. Adjusted net loss for the first six months of 2008 was US$4.88 billion, compared to adjusted net income of US$9.02 billion in the first six months of 2007. AMERICAN INTERNATIONAL: Moody's Cuts Unsecured Debt Rating to 'A3' ------------------------------------------------------------------ Moody's Investors Service has downgraded the senior unsecured debt rating of American International Group, Inc. to A3 from A2. This rating action reflects Moody's view that if AIG successfully completes the divestiture and restructuring plan, its business diversification will be significantly reduced. AIG's long-term ratings and its Prime-1 short-term rating remain on review for possible downgrade, reflecting the substantial execution risk in the restructuring plan, particularly given the current turbulent credit market. In the past year, AIG has reported substantial losses and write- downs associated with mortgage-backed securities, largely through its credit default swap and securities lending portfolios. Significant cash collateral calls and maturities related to these activities in recent weeks have caused the company to borrow heavily under the US$85 billion revolving credit facility recently provided by the Federal Reserve Bank of New York. Total borrowings under the two-year secured facility amounted to US$61 billion as of September 30, 2008, and more borrowings are expected in the months ahead. Moody's believes that the asset sales plan, if successful, will enable the company to repay borrowings under the Fed facility and emerge as a more focused, albeit less diversified, insurance firm. The continuing review for possible downgrade incorporates the risk that the situation may deteriorate, either because of shortfalls in executing the restructuring plan or because of declines in the business or financial profiles of the operations to be retained. Moody's believes that the risk of such deterioration is materially mitigated by the involvement of the Fed and the enhanced market liquidity that will likely result from the US Government's pending US$700 billion financial rescue plan. Following the restructuring, AIG's core businesses are expected to include the US-based Commercial Insurance Group, Foreign General Insurance and a majority stake in American International Assurance. The parent company's A3 senior debt rating is now three notches below the Aa3 insurance financial strength ratings of the CIG companies, the largest core operating unit. A three- notch differential is common among US insurance groups, but this represents an expansion of the notching for AIG, based on Moody's view that AIG will be materially less diversified following the restructuring. AIG's Prime-1 short-term rating reflects the significant protection to short-term creditors afforded by the Fed credit facility in the near term. Moody's also announced rating actions on several AIG subsidiaries whose ratings depend on explicit or implicit parental support. Ratings on most AIG units remain on review for possible downgrade. Moody's expects to revisit the stand-alone ratings, and perhaps the public ratings, for the major life insurance operations over the next few weeks. Certain operating units have been placed on review with direction uncertain, signaling potential sales to buyers whose credit profiles could be stronger, weaker or similar to that of AIG. The success of the restructuring plan, in Moody's view, hinges largely on AIG's ability to contain and reduce risk in its mortgage exposed investment and derivative portfolios. A majority of the borrowings under the Fed credit facility have been used to address liquidity and capital needs stemming from these exposures. Moody's noted that further deterioration in market values within these portfolios could further strain the company's resources through such mechanisms as increased collateral calls or reductions/terminations of funding arrangements. Such strains could weaken the company's credit profile, which may lead to additional rating downgrades. In such an event, contingent additional capital and liquidity needs could be triggered. The rating agency expects that AIG -- with the support and interest of the Fed -- will pursue various means to limit the risks associated with market value volatility in its investment and derivative portfolios. AIG's core insurance operations are fundamentally solid, said Moody's. CIG is the largest US commercial insurer, with a sound capital base, well diversified product offerings and expertise in writing large and complex risks. Foreign General is the top provider of accident & health insurance globally, operating in some 80 countries and adapting to local laws and customs as needed. The AIA companies make up one of the largest and most diversified life insurance groups spanning Asia and Australia. The insurance and other operations identified for sale include market leaders in many business lines and geographic areas. Major units expected to be sold include Domestic Life Insurance and Retirement Services, one of the largest and most diversified life insurance groups in the US; American Life Insurance Company, one of the largest international life insurers, with operations in more than 50 countries; International Lease Finance Corporation, a global leader in leasing and remarketing advanced technology commercial aircraft; and a minority stake in AIA. AIG's sales plans encompass well over a dozen substantial businesses. Moody's noted that all of AIG's operations are subject to significant reputational risk in connection with the recent liquidity strains that gave rise to the Fed credit facility. Challenges facing AIG managers include retaining clients, distributors and employees; demonstrating that the operating companies have ample resources to meet their obligations; generating new business; and facilitating divestitures. It will take time to determine the extent to which recent events may have weakened the companies' standing in their respective markets. Moody's continuing review of the ratings on AIG and its subsidiaries will focus on (i) the firm's evolving liquidity profile, including the level of borrowing under the Fed credit facility; (ii) steps taken to contain and reduce risk in the investment and derivative portfolios, including any associated losses or costs as well as any potential benefit from the US Government's pending US$700 billion financial rescue plan; (iii) the timing and amounts of cash proceeds generated from asset sales; (iv) the performance of major operating units, whether they are core operations or targeted for sale; and (v) the resulting financial flexibility profile (e.g., financial leverage and fixed charge coverage) of AIG following the asset sales. For those operations being sold, Moody's will consider their intrinsic financial strength as well as the rating profiles of potential acquirers. The last rating action on AIG took place on September 18, 2008, when Moody's reiterated the existing ratings and the review for possible downgrade, following the activation of the Fed credit facility. Moody's has downgraded these ratings and kept them on review for possible further downgrade: * American International Group, Inc. -- long-term issuer rating to A3 from A2, senior unsecured debt to A3 from A2, subordinated debt to Baa1 from A3; * AGFC Capital Trust I -- backed preferred stock to Baa3 from Baa2; * AIG General Insurance (Taiwan) Co., Ltd. -- insurance financial strength to A3 from A1; * AIG Life Holdings (US), Inc. -- backed senior unsecured debt to A3 from A2; * AIG Retirement Services, Inc. -- backed senior unsecured debt to A3 from A2, backed preferred stock to Baa2 from Baa1; * American General Capital II -- backed trust preferred stock to Baa1 from A3; * American General Finance Corporation -- long-term issuer rating to Baa1 from A3, senior unsecured debt to Baa1 from A3; * American General Institutional Capital A & B -- backed trust preferred stock to Baa1 from A3; * Capital Markets subsidiaries -- AIG Financial Products Corp., AIG Matched Funding Corp., AIG-FP Capital Funding Corp., AIG- FP Matched Funding Corp., AIG-FP Matched Funding (Ireland) P.L.C., Banque AIG -- backed senior unsecured debt to A3 from A2; * Mortgage Guaranty subsidiaries (second-lien and student loans) -- United Guaranty Commercial Insurance Company of North Carolina, United Guaranty Residential Insurance Company of North Carolina -- backed insurance financial strength to Baa1 from A3. Moody's has placed this rating on review for possible downgrade: * American General Finance, Inc. -- short-term debt at Prime-2. These ratings remain on review for possible downgrade: * American International Group, Inc. -- short-term issuer rating at Prime-1; * AIG Edison Life Insurance Company -- insurance financial strength at Aa3; * AIG Financial Products Corp. -- backed short-term debt at Prime-1; * AIG Funding, Inc. -- backed short-term debt at Prime-1; * AIG Liquidity Corp. -- backed short-term debt at Prime-1; * AIG Matched Funding Corp. -- backed short-term debt at Prime-1; * AIG SunAmerica funding agreement-backed note programs -- AIG SunAmerica Global Financing Trusts, ASIF I & II, ASIF III (Jersey) Limited, ASIF Global Financing Trusts -- senior secured debt at Aa3; * AIG SunAmerica subsidiaries -- AIG SunAmerica Life Assurance Company, First SunAmerica Life Insurance Company, SunAmerica Life Insurance Company -- insurance financial strength at Aa3; short-term insurance financial strength at Prime-1; * AIG UK Limited -- insurance financial strength at A1; * American International Assurance Company (Bermuda) Limited -- insurance financial strength at Aa3; * American Life Insurance Company -- insurance financial strength at Aa3; * Commercial Insurance Group subsidiaries -- AIG Casualty Company; AIU Insurance Company; American Home Assurance Company; American International Specialty Lines Insurance Company; Commerce and Industry Insurance Company; National Union Fire Insurance Company of Pittsburgh, Pennsylvania; New Hampshire Insurance Company; The Insurance Company of the State of Pennsylvania -- insurance financial strength at Aa3; * Domestic Life Insurance & Retirement Services subsidiaries -- AIG Annuity Insurance Company, AIG Life Insurance Company, American General Life and Accident Insurance Company, American General Life Insurance Company, American International Life Assurance Company of New York, The United States Life Insurance Company in the City of New York, The Variable Annuity Life Insurance Company -- insurance financial strength at Aa3; * Mortgage Guaranty subsidiaries (first-lien loans) -- United Guaranty Mortgage Indemnity Company, United Guaranty Residential Insurance Company -- backed insurance financial strength at Aa3. Moody's has downgraded the ratings and placed them on review with direction uncertain: * ILFC E-Capital Trusts I & II -- backed preferred stock to Baa3 from Baa2; * International Lease Finance Corporation -- senior unsecured debt to Baa1 from A3, preferred stock to Baa3 from Baa2, senior unsecured debt shelf to (P)Baa1 from (P)A3. Moody's has placed these ratings on review with direction uncertain: * International Lease Finance Corporation -- short-term debt at Prime-2; * Transatlantic Holdings, Inc. -- senior unsecured debt at A3, senior unsecured debt shelf at (P)A3, subordinated debt shelf at (P)Baa1; * Transatlantic Reinsurance Company -- insurance financial strength at Aa3. Moody's maintains a negative outlook on these ratings: * American General Finance Corporation -- short-term debt at Prime 2; * CommoLoco, Inc. -- backed short-term debt at Prime-2. These ratings have been (downgraded and) withdrawn for business reasons: * AIG Capital Corporation -- long-term issuer rating to Baa2 from Baa1; short-term issuer rating at Prime 2. AIG, based in New York City, is a leading international insurance and financial services organization, with operations in more than 130 countries and jurisdictions. The company is engaged through subsidiaries in General Insurance, Life Insurance & Retirement Services, Financial Services and Asset Management. AIG reported total revenues of US$19.9 billion and a net loss of US$5.4 billion for the second quarter of 2008. Shareholders' equity was US$78.1 billion as of June 30, 2008. DGT STEEL: Business Sold to Consortium; 100 Jobs Secured -------------------------------------------------------- Following the administration of Lenwade based DGT Steel & Cladding Ltd. on Wednesday, Oct. 1, 2008, and the lay off of the majority of the employees, the business has been successfully sold to a consortium of businessmen by the administrators and the jobs saved. DGT went into administration following pressures in the commercial property development sector and a difficult summer's trading. Administrators from PricewaterhouseCoopers LLP were called in and took immediate steps to protect the business by laying off all staff and contacting DGT's key customers. They also moved as a matter of urgency to contact potentially interested parties in buying the business. Stephen Oldfield, joint administrator and partner, PricewaterhouseCoopers LLP said: "The staff were understandably concerned they might never come back to jobs from lay off either because customers did not want them back on site or because we had not found a buyer. However, the decision to lay them off gave my team the time to ascertain the positions on the contracts and to find a buyer. Lay off meant they were not earning their full wage but they were not redundant and therefore had the chance of resuming employment as normal. "I am therefore delighted that with the business sale to the Consortium, it is business "as usual" and employees have returned to work. The team at PricewaterhouseCoopers worked very hard over the weekend with support from Eversheds Solicitors and Naismiths Quantity Surveyors to conclude the best deal for all creditors - including the employees. "To conclude a deal within four business days of our appointment is a record for me over the twenty years I have been in business recovery. It shows what can be done if you are open and honest with employees at the outset and concentrate on getting the deal done. If this deal had drifted further into this week I think the contracts DGT had would have fallen away and closure would have been inevitable." The Consortium, led by Van Thurston and SPC Holdings Ltd., successfully concluded the deal for the business of DGT, and the purchase will preserve more than 100 jobs at the offices and workshops of the business. Mr. Thurston said "Although these are very difficult times for any business involved in the Construction industry, I have a high regard for the DGT workforce. I am confident that we can build a successful business for the future." Andre Serruys of SPC Holdings said "I am pleased that we have been able to support the new DGT business. We have been able to ensure the continuing employment of over 100 people in the new business, which I feel is very important in the current economic market." About PricewaterhouseCoopers LLP PricewaterhouseCoopers LLP -- http://www.pwc.co.uk/-- provides industry-focused assurance, tax and advisory services. It has more than 16,000 partners and staff in offices around the UK. DIOMED HODLINGS: Pays in Full Debt to Hercules Technology --------------------------------------------------------- Diomed Holdings Inc. has settled in full its loan with Hercules Technology Growth Capital, Inc., with the payment at the end of September of US$1.1 million in accrued interest and loan fees, in addition to the full repayment of US$6.0 million of principal which was made in April 2008, Hercules Technology said in a press release Wednesday. "We are pleased that we were able to get full repayment of the loan principal plus accrued interest and fees," said Manuel A. Henriquez, co-founder, chairman and chief executive officer of Hercules. According to the press release, Diomed Holdings received US$7.0 million as a result of the settlement agreement with AngioDynamics Inc. which resolved the patent infringement lawsuit between the companies originally filed in January 2004. Of the US$7.0 million settlement proceeds, US$6.0 million was used to repay the outstanding loan principal balance to Hercules. As reported in the Troubled Company Reporter on Sept. 25, 2008, Bill Rochelle of Bloomberg News reported that the United States Bankruptcy Court for the District of Massachusetts will convene a hearing on Nov. 4, 2008, to consider confirmation of the liquidating Chapter 11 plan of Diomed Holdings, Inc., and its debtor-affiliate Diomed, Inc. Diomed agreed to sell its U.S. operations to AngioDynamics in April. AngioDynamics closed the sale of Diomed Holdings Inc.'s U.S. businesses on June 17. About Diomed Holdings Based in Andover, Massachussetts, Diomed Holdings Inc. (AMEX: DIO) -- http://www.evlt.com/and http://www.diomedinc.com/-- develops and commercializes minimal and micro-invasive medical procedures that use its proprietary laser technologies and disposable products. Diomed's EVLT(R) laser vein ablation procedure is used in varicose vein treatments. Diomed also provides photodynamic therapy for use in cancer treatments, and dental and general surgical applications. Diomed Holdings has no assets other than its 100% ownership in Diomed Inc., its operating unit. Diomed Inc. owns 100% of Diomed Ltd. in the United Kingdom and Diolaser Mexico SA de CV in Mexico. The company also has an affiliate in Asia through Diomed Hong Kong. The company and its affiliate, Diomed Inc., filed for Chapter 11 protection on March 14, 2008 (Bankr. D. Mass. Case Nos. 08-40750 and 08-40749). Douglas R. Gooding, Esq., at Choate Hall & Stewart LLP, is the Debtors local counsel and McGuireWoods LLP is its general counsel. Goulston & Storrs P.C. is counsel to the Official Committee of Unsecured Creditors. The company's schedules show total assets of US$19,936,479 and total liabilities of US$14,743,485. In connection with the Chapter 11 filings, Diomed Ltd. filed for Administration under the laws of the United Kingdom in the Cambridge County Court. Steven Mark Law of Ensors was named as administrator. EWHURST CONTROL: Brings in Liquidators from Tenon Recovery ---------------------------------------------------------- Robert C. Keyes and Paul W. Ellison of Tenon Recovery were appointed joint liquidators of Ewhurst Control Services Ltd. on Sept. 17, 2008, for the creditors' voluntary winding-up proceeding. The company can be reached at: Ewhurst Control Services Ltd c/o Tenon Recovery Aquarium 1-7 King Street Reading Berkshire RG1 2AN England LEHMAN BROTHERS: High Court Approves Client Asset Claims Process ---------------------------------------------------------------- The joint administrators of Lehman Brothers International (Europe) wish to update clients of LBIE about the position in relation to client monies and assets held by LBIE and what steps have been taken by the Administrators in this area. This update follows statements made by the Administrators on Sept. 21 and 26, 2008. In addition to addressing the issue of those Client Assets that in principle should be available to be returned to clients, the Administrators are very aware of the existence and issues faced by all of LBIE's unsecured creditors and their responsibilities to them. The Administrators have sought to adopt a system for dealing with Client Asset claims in an orderly and efficient manner and one which, while recognizing the importance of dealing with Client Asset claims, enables them to act with proper regard to the interests of all creditors. In particular the Administrators wish to assure all creditors that their claims will be fairly and equitably treated. This statement addresses only the position in relation to Client Assets. In order to ensure a planned and organized system for dealing with the large number of Client Asset claims the Administrators have designed a set of processes and procedures to deal with the claims in a logical, efficient and fair manner consistent with the performance of their primary functions of achieving a better result for LBIE's creditors as a whole than would be achieved on an immediate winding up. The Administrators presented these procedures to the High Court on Oct. 7, 2008, at which the FSA was also present, and have obtained an order approving these steps. Background Since their appointment, the Administrators have treated the identification and return of Client Assets of LBIE as a very important and urgent matter, recognizing also that it is a complex, highly technical area. The Administrators fully appreciate the market issues being faced by counterparties and that subject to certain preconditions being met those assets that are properly Client Assets should be available to be returned to clients. Against this background, the Administrators considered it appropriate to seek direction from the High Court on the development of appropriate procedures to be adopted to manage Client Asset claims. The Process The process for the identification and return of Client Assets, which has been approved by the Court, is set out below. General Approach The Administrators will: i. identify and take appropriate steps to gain control of all property of or held in the name of or otherwise to the order of LBIE, whether money, securities or other contractual rights, that may be subject to trust or proprietary claims; ii. identify the entire population of counterparties that purport to have claims, rights or other interests in the Trust Property; iii. seek to reconcile all of the data and information available to LBIE and the Administrators from the pre- administration records in relation to the Trust Property with the information supplied by counterparties, custodians and any other appropriate sources; iv. whether by agreement, directions from the Court or otherwise, reach a clear determination of the various legal issues that impact upon the validity of the Trust Claims and the rights of LBIE over the Trust Property; v. subject to directions from the Court, agree a procedure for making interim distributions of Trust Property to counterparties with valid Trust Claims; vi. determine the basis upon which the costs and expenses of the Administrators in dealing with and determining all issues in relation to the Trust Property can be discharged from the proceeds of the Trust Property and apply for directions on such matters, as necessary; and vii. determine the most expedient method of communicating with counterparties in relation to the procedure being adopted by the Administrators, the progress made towards the achievement of the defined objectives and the directions that may be given from time to time by the Court. Method The Administrators will: i. deploy dedicated resource comprising partners and employees from PricewaterhouseCoopers LLP and Linklaters LLP, to take responsibility for the further development and implementation of a plan designed to achieve the objectives set out in paragraph 1 above; and ii. set up a discrete sub-committee to monitor the construction and implementation of this scheme and the efficiency and fairness of the methodology. This sub- committee will also review the principles applicable to prioritizing the determination of the claims of the particular counterparties by identifying, where appropriate, high profile problems or hardship issues, to ensure that the overriding objective of treating all counterparties fairly is not prejudicial to the interests of a minority or that there is not otherwise a problem that requires specific and accelerated attention. This sub-committee will meet periodically (initially daily) to review the prioritization and refine the process as events develop. Key Steps The Trust Property Team will undertake inter alia the following functions: i. design and install a new IT system onto which it will upload all of the data available from the internal systems of LBIE relating to client deposits and securities that may be Trust Property; ii. implement a process to reverse or amend the LBIE records for failed or broken trades as a consequence of the Administration, to enable the Trust Property to be more fully identified; iii. identify the impact of termination notices that have been served post-administration, validate these events and other activities of third parties and either review the clients' valuation of the impact of the termination or undertake a valuation of the impact of termination on the rights of LBIE under various contracts; and iv. agree a protocol in relation to the implementation of corporate actions that may need to be undertaken in relation to Trust Property, for example, the exercise of voting rights, receipt of dividends, rights issues and other pre-emptive offers, that will have an impact on the ultimate value of the Trust Property. The Trust Property Team will contact all of the third party custodians, agents, counterparties, exchanges and clearing houses where Trust Property may be located to obtain confirmation of the securities that are being held and to agree a procedure whereby the Administrators can have online access in relation to data regarding the securities and seek to obtain formal written confirmation of the position by security and by Depot. The Administrators will also seek to establish that they have complete or adequate control over the securities for the ultimate benefit of the counterparties with Trust Claims or LBIE and that any liens asserted by the Depots are assessed and valued. Once the data is available, the Trust Property Team will reconcile the books of LBIE to those of the Depots, by security and by Depot, with a view to identifying and resolving discrepancies. Where appropriate, this process will take account of the interests of LBIE in its "house accounts". The Administrators will write to all of the counterparties who may have Trust Claims to obtain from them full details of the rights and claims they believe they have in relation to all forms of Trust Property. The Trust Property Team will seek to reconcile all of the data that is obtained in relation to Trust Property as a consequence of the exercise outlined in the paragraph above with the information obtained from counterparties. While the data reconciliation process is being undertaken, the Administrators have instructed Linklaters to devise a program to determine by reference inter alia to the various contracts utilised by LBIE in its dealings with all counterparties, the various categories of legal issues that will need to be determined before a proposal for the distribution of the Trust Property can be prepared. The Administrators will consider whether it is possible for this process to take place in parallel to the data collection exercises noted above, or whether it is more appropriate (in some cases) to wait until it is clear that all the legal issues identified need resolution in practice. Prioritization The Administrators will, having taken due account of any views of the FSA, identify a set of principles that can be applied when considering prioritizing claims, taking into account, where appropriate and consistent with their duties as administrators, the following factors, which include: i. the quality and timing of data being available to the Administrators; ii. the speed of response of counterparties in dealing with the Administrators' questions, coupled with the quality and accuracy of the data supplied, the complexity of the data and the legal issues relevant to the determination of a particular claim; iii. the number of claims that may be made to a particular class or category of Trust Property; the risk of a shortfall of Trust Property; iv. the cost efficiency and expediency of the relevant process; and v. market stability and confidence. Further Directions The Administrators may from time to time need to seek further directions from the High Court on this process and on particular issues arising from it. About PricewaterhouseCoopers LLP PricewaterhouseCoopers LLP -- http://www.pwc.co.uk/-- provides industry-focused assurance, tax and advisory services. It has more than 16,000 partners and staff in offices around the UK. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com-- is the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Through its team of more than 25,000 employees, Lehman Brothers offers a full array of financial services in equity and fixed income sales, trading and research, investment banking, asset management, private investment management and private equity. Its worldwide headquarters in New York and regional headquarters in London and Tokyo are complemented by a network of offices in North America, Europe, the Middle East, Latin America and the Asia Pacific region. The firm, through predecessor entities, was founded in 1850. Lehman filed for chapter 11 bankruptcy Sept. 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition listed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. The September 15 Chapter 11 filing by Lehman Brothers Holdings, Inc., does not include any of its subsidiaries. Subsidiary LB 745 LLC, submitted a Chapter 11 petition on September 16 (Case No. 08-13600). The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Barclays Bank Plc has agreed, subject to U.S. Court and relevant regulatory approvals, to acquire Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. These are currently the only UK incorporated companies in administration. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on Sept. 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. The two units of Lehman Brothers Holdings, Inc., which has filed for bankruptcy protection in the U.S. Bankruptcy Court for the Southern District of New York, have combined liabilities of JPY4 trillion -- US$38 billion). Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Akio Katsuragi, a former Morgan Stanley executive, runs Lehman's Japan units. Lehman Brothers Asia Limited, Lehman Brothers Securities Asia Limited and Lehman Brothers Futures Asia Limited have suspended its operations with immediate effect, including ceasing to trade on the Hong Kong Securities Exchange and Hong Kong Futures Exchange, until further notice. The Asian units' asset management company, Lehman Brothers Asset Management Limited, will continue to operate on a business as usual basis. A further notice concerning the retail structured products issued by or arranged by any Lehman Brothers group company will be issued as soon as possible, a press statement said. MOTOR WORLD: Calls in Administrators from BDO Stoy Hayward ---------------------------------------------------------- Motor World Ltd has appointed Dermot Power, Graham Newton and Matthew Dunham, Business Restructuring partners at BDO Stoy Hayward as joint administrators, reifenpresse.de reports. Due to the decline in retail sales, the company closed 95 of its 237 retail units. Three hundred of its staff lost their jobs due to the closure. The remaining 142 units have been sold to Pacific Retail Limited saving approximately 500 jobs. Motor World Ltd. -- http://www.motor-world.co.uk/-- is one of the UK's largest independent automotive car care retailers, trading from a chain of 237 retail units across the country. NORTHERN ROCK: Implements Changes to Range of Savings Products -------------------------------------------------------------- Northern Rock plc has made further changes to its range of savings products in recognition of its commitment to its Competitive Framework. The self-imposed framework is designed to ensure Northern Rock does not take unfair advantage of Government support during the period of temporary public ownership. As part of this commitment Northern Rock has capped its market share of UK retail deposit balances at 1.5%. Northern Rock confirms that retail balances remain within this level. However, recent turbulence in financial markets has led to a sizable inflow of retail deposits, particularly in recent days, and Northern Rock is therefore taking further action to moderate its product range and product pricing, to uphold its competitive commitments. This follows the recent withdrawal of a number of funding products, including its Fixed Rate Access Bond and online E-Saver product. The Company will continue to monitor closely the level of retail balances and manage both its product range and pricing in order to comply with its Competitive Framework. Products Withdrawn: Northern Rock is withdrawing a number of savings products for new customers from its range including: * Silver Savings * Silver Savings 30 * Business Reserve * Range of Fixed Rate Bonds Product withdrawals will take effect from Thursday, Oct. 2, 2008. Northern Rock retains a range of savings products and remains open for business. For existing customers, there are no changes to the terms and conditions and it is business as usual. Products Available: Northern Rock's still maintains a range of savings products for new customers that includes: * Branch Saver - 4.90% AER * Range of Fixed Rate ISA's - up to 6.00% AER * Save Direct Base Rate Tracker - 3.45% AER * Save Direct Tracker 90 - from 3.70% AER * Current Account Further detail on trading will be provided at the time of the Company's Quarter 3 Trading Statement, which is due to be released on Oct. 14, 2008. Northern Rock Savings Pledge Northern Rock's Savings Pledge continues to ensure that its savers are kept fully informed of any changes to their accounts. Northern Rock writes to its savers every time it changes the interest rate on their account. In addition, if the account is a notice account and rates are to be reduced, the advance notice will be at least the same as the notice period. About Northern Rock Headquartered in Newcastle upon Tyne, England, Northern Rock plc -- http://www.northernrock.co.uk/-- deals with mortgages, savings accounts, loans and insurance. The company also promotes secured loans to its existing mortgage customers. The company had more than US$200 billion in assets at the end of June 2007. * * * Northern Rock plc continues to carry a B1 subordinated debt rating, a B3 junior subordinated rating, a C preferred stock rating and an E+ bank financial strength rating from Moody's with developing outlook. The bank still carries an 'F' individual rating from Fitch. STRAKER INTERACTIVE: Appoints Nick Wood as Liquidator ----------------------------------------------------- Nick Wood of Grant Thornton UK LLP was appointed liquidator of Straker Interactive Ltd. on Sept. 15, 2008, for the creditors' voluntary winding-up procedure. The company can be reached at: Straker Interactive Ltd. 1640 Parkway Solent Business Park Whiteley Fareham PO15 7AH England WADKIN ULTRACARE: Calls in Liquidators from Mazars -------------------------------------------------- Philip Michael Lyon and Roderick John Weston of Mazars LLP were appointed joint liquidators of Wadkin Ultracare Ltd. on Sept. 11, 2008, for the creditors' voluntary winding-up proceeding. The company can be reached at: Wadkin Ultracare Ltd. c/o Mazars LLP Cartwright House Tottle Road Nottingham NG2 1RT England WILLIS GAMBIER: Sold to Samson Holdings; 61 Jobs Secured -------------------------------------------------------- Willis & Gambier Ltd., the furniture import and distribution business, has been successfully sold to Samson Holdings Ltd. The deal completed Monday evening and secured the jobs of the 61 employees based at the Company's East Anglian sites at Saffron Walden and Peterborough. The company went in to administration on Sept. 24, 2008, following trading difficulties over the summer, exacerbated by the consumer downturn in demand. Willis & Gambier supply furniture to some of the biggest high street retailers and the administrators were able to secure continuity of supply for the key customers while they sought a buyer for the business as a going concern. Stephen Oldfield from PricewaterhouseCoopers LLP, joint administrator, said: "We were able to stabilize the business following the administration appointment and with the support of the Willis & Gambier retained workforce, key customers and suppliers, we were able to keep the orders flowing while we sought a buyer. "I am delighted that we were able to do this deal which sees 61 employees transferred to the new owners as from [Mon]day. This is good news for East Anglia and all the more pleasing given the current uncertain economic environment." About PricewaterhouseCoopers LLP PricewaterhouseCoopers LLP -- http://www.pwc.co.uk/-- provides industry-focused assurance, tax and advisory services. It has more than 16,000 partners and staff in offices around the UK. * S&P Issues Report on U.S. Bailout and European Government Summit ------------------------------------------------------------------ On Oct. 4, 2008, the leaders of Europe's G8 members (France, Germany, Italy, and the U.K.) met to discuss the current turmoil in the banking system. As expected, the meeting did not lead to the creation of a European equivalent of the US$700 billion U.S. bail-out plan. It would be difficult to establish such a plan in Europe because each country would differ in its ability and willingness to participate, which would likely frustrate agreement on individual contributions. Instead, the leaders re-affirmed their commitment to take "all necessary measures" on a country-by-country basis to ensure the soundness and stability of the banking system. There has, in Standard & Poor's Ratings Services' view, been very strong government support for European banks throughout the credit crunch, and the recent summit seems to confirm that there is a clear consensus in favor of maintaining this stance. Government support is a key rating factor for European banks and a significant mitigant to the extreme funding pressures currently facing the sector, which would otherwise call for lower bank ratings. The governments' joint statement following the summit details a number of areas where government support for European banks will be maintained and in many cases strengthened. At the industrywide level, it encourages central banks to ensure the provision of sufficient liquidity to the system to preserve confidence and stability. It also proposes to increase and harmonize the amounts covered by national deposit guarantee schemes. It encourages improved co-ordination and co-operation between EU member states, including enhanced supervision of groups with cross-border business, and greater consideration of the effects of national decisions on other countries. The latter appears to refer to Ireland's guarantee of its largest financial institutions, which reportedly resulted in a transfer of deposits from banks in other countries. In S&P's view, there is potential for confusion between the formal guarantee on senior and dated subordinated debt introduced by the Irish government and the pledges/commitments announced by a number of other European governments (including Germany and Denmark) to guarantee the safety of deposits in their respective banking systems. While individual countries will continue to act decisively to maintain the integrity of their economies, uncoordinated actions could, in S&P's view, have a potentially destabilizing effect, leading to competitive distortions between banks and national jurisdictions. The government leaders also urged the European Commission to respond quickly and flexibly in its application of state aid rules, and to allow EU member states to increase government budget deficits beyond agreed targets, where necessary. In an article published last week, S&P explained how extraordinary government support is taken into account in its ratings on European banks. The rating agency classifies European countries as supportive because they generally rely on prudential regulation to maintain stable banking systems, but can be expected to intervene directly in stress periods such as now. The recent summit, in S&P's view, underlines the strong likelihood of government support for systemically important European banks in the current climate. European governments have clearly concluded that rescuing systemically important banks must take clear precedence over moral hazard and competition concerns at the present time. The industrywide and institution-specific measures which have already been taken in Europe illustrate, in S&P's view, that governments are extremely unlikely to allow solvent systemically important banks to fail because of a lack of liquidity. If market conditions remain extremely difficult, the rating agency expects that a growing number of European banks will benefit from specific government support in the foreseeable future. S&P expects that governments will continue to favor and facilitate private sector solutions where possible, but will otherwise lead a rescue themselves. In some cases, such as Fortis and Bradford & Bingley, S&P's have seen joint private and public sector solutions. The various potential scenarios may, in its view, have materially different outcomes for different classes of creditors, particularly preferred shareholders and subordinated bondholders. Once the credit crunch has passed, governments will likely demand tighter regulation and a degree of restructuring of the banking sector as a payback for the support currently being provided. Danish banks, for example, may not pay ordinary dividends while their state guarantee is in place. In this environment, S&P continues to base its European bank ratings on its analysis of their fundamental long-term creditworthiness. Widespread downgrades or rating volatility would not, in its view, reflect the reality of the significant external support that currently underpins the sector. This support is intrinsic to the banks' standing in the current climate, and it would be futile to attempt to divorce it from their "stand-alone" ratings. Equally, rating relativities do not primarily reflect S&P's view of the likelihood of each bank being rescued, if necessary. The overwhelming priority given to the maintenance of financial confidence and stability means that European governments and central banks can be expected to support any bank with high or moderate systemic importance. S&P will continue to take rating action in cases where individual banks appear more vulnerable to economic and market developments than peers at the same rating level. S&P will also act on the ratings of debt instruments (particularly subordinated issues) that may be adversely affected by a rescue targeted at the protection of a bank's retail depositors and senior wholesale funding. * Wall Street Crisis Hits Various Banks Across Europe ----------------------------------------------------- The Guardian's David Teather wrote that the contagion from the Wall Street crisis spread throughout Europe pointing to Iceland's and Germany's rescue of ailing banks, Britain's decision to nationalize Bradford & Bingley Plc, and the bail-out of the Belgian bank Fortis N.V. According to The Guardian, Economists were wary of predicting where the crunch might bite next. Global Insight's chief European economist, Howard Archer, said that the weak ones will be next. A. France The widening turmoil was also felt in France, The Guardian stated. President Nicolas Sarkozy summoned the heads of the nation's leading banks and insurance groups to an emergency summit aimed at preventing the crisis from gaining traction there. Rumors had then began to circulate that Franco-Belgian bank Dexia is next to face trouble. B. Germany The Guardian noted that the German government and other banks extended a EUR35 billion (GBP28 billion) lifeline to Hypo Real Estate, the second largest commercial property lender in the country and one of the country's largest publicly quoted companies. The agreement represented the most serious impact of the crisis. The finance ministry had said the government would provide EUR26.6 billion, with several unidentified banks making up the rest, the report continued. C. Belgium The governments of Belgium, the Netherlands and Luxembourg reached agreement on an EUR11.2 billion bail-out of Fortis to avoid duplicating Northern Rock's undertakings, The Guardian reported. Fortis is one of the largest retail banks across the three countries. Each government took a 49% stake in the Fortis subsidiaries in its country. Under the agreement, Fortis will sell its stake in Dutch bank ABN Amro, which it bought a year ago for EUR24 billion. According to The Guardina, Fortis' buy of ABN Amro marked the beginning of the bank's troubles. D. Iceland The government in Reykjavik seized control of Glitnir, one of Iceland's biggest banks, stoking fears that the tiny nation might be facing financial disaster. The Icelandic government bought a 75% stake in Glitnir for EUR600 million. Glitnir said its funding position had deteriorated in a matter of days and its largest shareholder, Stodir, had filed for bankruptcy. The Guardian noted that the Icelandic krona has lost 60% of its value against the dollar this year. ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers' public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than US$3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. A list of Meetings, Conferences and Seminars appears in each Thursday's edition of the TCR. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/booksto order any title today. ********* 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. Zora Jayda Zerrudo Sala, Pius Xerxes Tovilla, Joy Agravante, Melanie Pador, Marie Therese V. Profetana and Peter A. Chapman, Editors. Copyright 2008. 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$625 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 * * *