/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/091014.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 14, 2009, Vol. 10, No. 203 Headlines A U S T R I A AROG TRANSPORT: Claims Filing Deadline is October 29 EVRO SOUND: Claims Filing Deadline is October 28 GERHARD DALLINGER: Claims Filing Deadline is October 29 U.E.H. HANDEL: Claims Filing Deadline is October 29 B U L G A R I A KREMIKOVTZI AD: Bulgaria to Investigate Causes of Bankruptcy G E R M A N Y EDSCHA GROUP: Creditors Back Sale of Body Components Business EUROHOME MORTGAGES: Moody's Reviews Ratings on 2007-1 Notes FORCE 2005-1: Moody's Lowers Rating on Class A Notes to 'B1' GENERAL MOTORS: May Sign on Opel Deal With Magna This Week HEIDELBERGCEMENT AG: To Sell EUR1 Bln of Bonds to Refinance Debt HEIDELBERGCEMENT AG: Moody's Assigns Initial 'B3' Rating on Bonds HEIDELBERGCEMENT AG: Fitch Puts 'B' Rating on Positive Watch TALISMAN-7 FINANCE: Fitch Cuts Rating on Class F Notes to 'B-' VAC HOLDING: S&P Downgrades Corporate Credit Rating to 'SD' I C E L A N D EXISTA HF: Deloitte Probed Over Role in Bakkvor Stake Sale I T A L Y ALITALIA SPA: Nears Attitech Sale Deal, Ansa Says CORDUSIO RMBS: Fitch Downgrades Rating on Class E Notes to 'B' EUROHOME MORTGAGES: Moody's Reviews Ratings on 2007-1 Notes K A Z A K H S T A N ABAT IT: Creditors Must File Claims by October 21 ALATAU BUSINESS: Creditors Must File Claims by October 21 ALFA ESTATE: Creditors Must File Claims by October 21 KK COMPANY: Creditors Must File Claims by October 21 OIL SYNTEZ: Creditors Must File Claims by October 21 ROST HOLDING: Creditors Must File Claims by October 21 SARY ARKA: Creditors Must File Claims by October 21 SELF LLC: Creditors Must File Claims by October 21 SOUTH VENTURES: Creditors Must File Claims by October 21 VIT SAN: Creditors Must File Claims by October 21 K Y R G Y Z S T A N STROY MASTER: Creditors Must File Claims by October 28 URAN GEO BUR: Creditors Must File Claims by October 28 N E T H E R L A N D S DSB BANK: Placed Under Dutch Central Bank's Control GROSVENOR PLACE: Moody's Cuts Rating on Class E Notes to 'Caa3' JUBILEE CDO: Moody's Cuts Rating on Class E Notes to 'Caa3' VIKING DRILLING: Files Plan to Avert Chapter 7 Conversion R U S S I A AVTOVAZ OAO: Net Loss Widens to RUR19.5 Bln in First Half 2009 INTER-STROY LLC: Creditors Must File Claims by October 18 POLYMETAL OAO: Fitch Assigns Issuer Default Rating at 'B' TEKH-PROM LLC: Creditors Must File Claims by October 18 ULYANOSKIY AMMUNITION: Creditors Must File Claims by October 18 VERKHNEKAMSK-LES: Kirovskaya Bankruptcy Hearing Set October 22 ZAPADNO-SIBIRSKAYA: Creditors Must File Claims by October 18 ZIMINSKIY BRICK: Kemerovskaya Bankruptcy Hearing Set October 22 S P A I N DOGI INTERNATIONAL: Posts EUR25.6 Million Loss in First Half 2009 S W I T Z E R L A N D CIRRUS SWISS: Claims Filing Deadline is December 2 DECO 15: Fitch Junks Ratings on Two Classes of Notes EXELL TRAINING: Claims Filing Deadline is October 30 GASTRO WIPKINGER: Claims Filing Deadline is November 9 GJR GERMAN: Claims Filing Deadline is November 30 KLOPFSTEIN HOLDING: Claims Filing Deadline is November 2 SAG ALUTRADING: Claims Filing Deadline is November 2 SPOERRI TRANSPORTE: Claims Filing Deadline is October 21 TAURUS CMBS: Fitch Downgrades Rating on Class D Notes to 'B' TEAK-HOUSE: Claims Filing Deadline is November 16 WALDMEIER HOLDING: Claims Filing Deadline is November 10 XAGX RAPPERSWIL: Claims Filing Deadline is November 27 U K R A I N E BUDISCHE FURNITURE: Creditors Must File Claims by October 17 CLIMATE ENGINEERING: Creditors Must File Claims by October 17 GELENA SIM: Creditors Must File Claims by October 17 MINKO LLC: Creditors Must File Claims by October 17 NAKRATORG LTD: Creditors Must File Claims by October 17 OLIMPIC CASINO: Creditors Must File Claims by October 17 U N I T E D K I N G D O M AER LINGUS: May Face Insolvency if Pension Scheme Changes Rejected CATTLES PLC: FSA Conducts Probe Over Provisions for Bad Loans CORE: Tenon Recovery Appointed as Administrators GENERAL MOTORS: Magna Won't Make Compulsory Job Cuts at Vauxhall INCA TECHNOLOGY: In Administration; Leonard Curtis on Board ITV PLC: Sir Michael Bishop Drops Out of Chairman Race JJB SPORTS: To Push Through with GBP100 Million Fundraising LADBROKES PLC: Fitch Affirms Issuer Default Rating to 'BB+' LINK LENDING: Placed Into Administration; PwC on Board NEWGATE FUNDING: Moody's Cuts Ratings on Two Classes of Notes to C TOOTSIES RESTAURANTS: Placed Into Administration URSUS 2: Moody's Cuts Rating on GBP27.2 Mln Class F Notes to 'Ba2' * UK: PwC Survey Finds Survival of Companies Getting Easier ********* ============= A U S T R I A ============= AROG TRANSPORT: Claims Filing Deadline is October 29 ---------------------------------------------------- Creditors of Arog Transport GmbH have until October 29, 2009, to file their proofs of claim. A court hearing for examination of the claims has been scheduled for November 12, 2009 at 10:00 a.m. For further information, contact the company's administrator: Dr. Peter Zens Esteplatz 5/5 1030 Vienna Austria Tel: 534 90 Fax: 534 90-50 E-mail: office@schopf-zens.at EVRO SOUND: Claims Filing Deadline is October 28 ------------------------------------------------ Creditors of Evro Sound GmbH have until October 28, 2009, to file their proofs of claim. A court hearing for examination of the claims has been scheduled for November 11, 2009 at 10:30 a.m. For further information, contact the company's administrator: Mag. Norbert Abel Franz-Josefs-Kai 49/19 1010 Vienna Austria Tel: 533 52 72 Fax: DW 15 E-mail: office@abel-abel.at GERHARD DALLINGER: Claims Filing Deadline is October 29 ------------------------------------------------------- Creditors of Gerhard Dallinger GmbH have until October 29, 2009, to file their proofs of claim. A court hearing for examination of the claims has been scheduled for November 12, 2009 at 9:30 a.m. For further information, contact the company's administrator: Dr. Ute Toifl Habsburgergasse 6-8/17 1010 Vienna Austria Tel: 535 46 11 Fax: 535 46 11 - 11 E-mail: office@toifl.com U.E.H. HANDEL: Claims Filing Deadline is October 29 --------------------------------------------------- Creditors of U.E.H. Handel GmbH have until October 29, 2009, to file their proofs of claim. A court hearing for examination of the claims has been scheduled for November 12, 2009 at 10:15 a.m. For further information, contact the company's administrator: Mag. Andrea Eisner Weyrgasse 8/7 1030 Vienna Austria Tel: 712 04 77 Fax: 712 04 77-12 E-mail: office@ra-eisner.at =============== B U L G A R I A =============== KREMIKOVTZI AD: Bulgaria to Investigate Causes of Bankruptcy ------------------------------------------------------------ Steel Guru, citing novinite.com, reports that Totyu Mladenov, Bulgaria's Labor minister, said the country's Ministry of Economy, Energy, and Tourism is going to start investigating the causes of Kremikovtzi AD's bankruptcy. The Company was declared bankrupt in September 2008, Steel Guru relates Mr. Mladenov also made it clear the talks about the fate of the steel maker would continue. Separately, Steel Guru, citing Dnevnik, reports that a rescue plan for Kremikovtzi could be contested in court by minority shareholders and any other stakeholder over violation of rights guaranteed by the Public Offering of Securities Act. The legislation, Steel Guru discloses, does not permit the proposed capital increase at the public company as it deprives minority shareholders of their rights to participate in the procedure in accordance with their holdings and on an even playing field. Steel Guru recalls in the summer of 2009, Kremikovtzi's court- appointed receiver, Tsvetan Bankov, came up with a proposal to convert into shares the creditors' claims worth around BGN944 million. According to Steel Guru, if the plan is implemented, the company's capital will be augmented from the current BGN18.5 million into BGN963 million, with bondholders controlling more than 81%. As reported in the Troubled Company Reporter-Europe, Bloomberg News, citing Tsvetan Bankov, Kremikovtzi's receiver, said the company's assets aren't enough to cover its liabilities. Bloomberg disclosed Mr. Bankov said the plant has assets worth BGN840 million (US$612.5 million) and liabilities of BGN1.9 billion, 42% of which are owed to state-run power and gas utilities, the State Railways and tax authorities. About Kremikovtzi Headquartered in Sofia, Bulgaria, Kremikovtzi AD -- http://www.kremikovtzi.com/-- is a company principally engaged in the steel industry. Its production capacity includes a complete steel production cycle, from ore mining to finished products, such as hot rolled and cold rolled products (coils, slabs, plates, blooms and billets), different thickness wire rods and tubes. The Company's product range also includes coke and chemical products, ferro-alloys and metallurgical lime. The Company operates through a number of subsidiaries, including Kremikovtzi Trans EOOD, Nezavisima laboratoriya za analizi EOOD, Kremikovtzi rudodobiv AD, Ferosplaven zavod EOOD, Global Trade Trans and Kremi Logistics EOOD, among others. The Company has undergone the insolvency process since August 6, 2008. As reported in the Troubled Company Reporter-Europe on Aug. 8, 2008, the Sofia City Court commenced insolvency proceedings against Kremikovtzi AD after declaring it bankrupt. The court appointed a temporary bankruptcy administrator for the steelmaker. The court also ruled that Kremikovtzi's insolvency started on Dec. 31, 2005. ============= G E R M A N Y ============= EDSCHA GROUP: Creditors Back Sale of Body Components Business ------------------------------------------------------------- The insolvency administrator of the Edscha Group, legal representative Dr. Joerg Nerlich at the law firm GOERG, received approval, without dissenting vote, for the sale of the Body Components Business Unit to the Spanish automotive supplier Gestamp Automocion at the meeting of the Creditors' Committee on Oct. 9. During the past weeks, together with the mandated investment bank UBS, the M&A consultant Ralf Schmitz from Ziems + Partner, and contract expert Dr. Wolfgang Koenig from the law firm GOERG, he negotiated ready-to-be-signed contracts of sale with several bidders which were put to the vote Oct. 9 in the Creditors' Committee. Gestamp Automocion now has received the nod because its offer found the broadest acceptance. It was agreed to maintain silence concerning the contents of the negotiated agreement, which will be notarized in the coming week. Worldwide about 4,100 people are employed in the Edscha Body Components Business Unit, 1,400 of them at three locations in Germany. The business unit generated around two thirds of the revenues of the Edscha Group in financial year 2007/2008, which totaled more than a billion euros. The takeover of Edscha's Convertible Roof Systems Business Unit by Webasto AG is still subject to the usual provisos of the cartel authorities. In the convertible unit Edscha employs around 1,200 people, including 800 in Germany. On Feb. 2, 2009, the board of Edscha AG initiated insolvency proceedings for the European sites of the Edscha Group. Mr. Nerlich was appointed as the temporary insolvency administrator. He already succeeded in stabilizing business operations during the preliminary insolvency proceedings. This was an essential precondition for continuing company business together with the Management Board of Edscha AG. The reasons for filing for insolvency were the massive declining trends in the global automobile market in combination with clearly deteriorating access to financing in the capital markets. About the Edscha Group The Edscha Group -- http://www.edscha.com/-- manufactures door hinges, convertible roofs and driver controls for major carmakers. It currently has a staff of 5,300. EUROHOME MORTGAGES: Moody's Reviews Ratings on 2007-1 Notes ----------------------------------------------------------- Moody's Investors Service has placed on review for possible downgrade all the rated notes issued by Eurohome Mortgages 2007-1 plc: -- Class A, Placed Under Review for Possible Downgrade; previously on January 30, 2009 Downgraded to Aa1 -- Class B, Placed Under Review for Possible Downgrade; previously on January 30, 2009 Downgraded to A2 -- Class C, Placed Under Review for Possible Downgrade; previously on January 30, 2009 Downgraded to Baa3 -- Class D, Placed Under Review for Possible Downgrade; previously on January 30, 2009 Downgraded to B3 -- Class E, Placed Under Review for Possible Downgrade; previously on January 30, 2009 Downgraded to Ca -- Class X, Placed Under Review for Possible Downgrade; previously on January 30, 2009 Downgraded to Ca The ratings of the German Mortgage Early Repayment Certificates and the Italian Mortgage Early Repayment Certificates are not affected by this rating action. The review for possible downgrade was prompted by the worse-than- expected collateral performance of the underlying portfolio. This may lead to an increase in portfolio loss expectations resulting from higher-than-expected delinquency and default levels in the transaction. Since the last review on January 30, 2009, delinquencies and defaults have increased steeply in the transaction. Both sub- pools have experienced far higher delinquencies than Moody's initial assumptions. Terminated loans in the German sub-pool rose to 12.8% from 8.4% of current balance between November 2008 and October 9. In the Italian sub-pool, cumulative defaults increased to 6.67% of original balance from 2.17% during the same time frame. Outstanding defaults were 7.73% of current balance on the latest payment date (August 2009). While 90+ delinquencies in the German sub-pool seem to be stabilizing at 1.2% of current balance, they have increased to 15.51% from 7.66% in the Italian sub-pool, resulting in a 9.1% delinquency level of the combined pool, which is almost double the 5.0% reached in November 2008. Moody's notes that the transaction has used all of its reserve fund. As of the last payment date, Class E and Class X had unpaid interest of EUR41,108 and EUR49,699, respectively. Class E has an unpaid principal deficiency ledger of EUR1,694,041, while Class X has an unpaid PDL of EUR4,200,000. The provisioning mechanism for loans in the Italian sub-pool that are in arrears by 12 monthly installments led to reserve fund drawings on the interest payment dates between August 2008 and February 2009. By this mechanism, the equivalent of the loan amount of loans in arrears by 12 monthly installments is credited to the PDL and leads to trapping of available excess spread and, if excess spread is insufficient, to drawings on the reserve fund. Based on the amount of delinquent Italian loans and the amount of already terminated German loans, Moody's expects significant additional amounts to be credited to the PDL on future interest payment dates. As part of Moody's detailed transaction review, Moody's will reassess the lifetime loss expectation for the portfolio, reflecting the collateral performance to date as well as the future macro-economic environment. Moody's will also request, whenever not already available, updated loan-by-loan information to revise its MILAN Aaa credit enhancement. Loan-by-loan information will also permit Moody's to validate its assumptions with regards to which loans have a higher default propensity. The lifetime loss and the MILAN Aaa credit enhancement are the key parameters used by Moody's to calibrate its loss distribution curve, which is one of the core inputs in the cash-flow model. The transaction is backed by mortgage loans originated by Deutsche Bank in Germany and Italy and was closed and initially rated in July 2007. During the review, Moody's will also assess the ability of the German and Italian servicers to reduce delinquencies and new defaults and to increase the net present value of recoveries on defaulted assets. Moody's ratings address the expected loss posed to investors by the legal final maturity of the notes. Moody's ratings address only the credit risks associated with the transaction. Other non- credit risks have not been addressed, but may have a significant effect on yield to investors. Moody's will continue to monitor the performance of this RMBS transaction closely. FORCE 2005-1: Moody's Lowers Rating on Class A Notes to 'B1' ------------------------------------------------------------ Moody's Investors Service has taken these rating actions on notes issued by Force 2005-1 Limited Partnership. Issuer: Eirles Two Limited Series 298 (Repack Force Equity) -- EUR14.8M Class A, Downgraded to B1 and Remains On Review for Possible Downgrade; previously on Mar 25, 2009 Ba2 Placed Under Review for Possible Downgrade Moodys retains Series 298 under review for possible downgrade until it has finalized its review of the stresses pertaining to loss participation features in relation to the assets, as further detailed below. The series 298 is a repack of a slice of Class E1 of Force 2005-1. The EUR14.8 million of series 298 amounts to approx. 31.7% of the EUR46.7 million Class E1 note. Force 2005-1 is a static mezzanine finance CLO referencing a portfolio of German 'Genussrechte' loans. Some of the 'Genussrechte' obligations in the portfolio have certain features of equity including subordination and linkage of payments to financial performance of the obligor such as interest deferral features and contingent coupon components. These obligations can be written down depending on financial performance of the obligor and may extend redemption beyond the legal final maturity of the transaction which is 4 years after its scheduled maturity date. Obligations which have not redeemed at par plus accrued interest by the legal maturity of the transaction will expire and lead to a loss for Force 2005-1. According to Moody's, the rating actions taken on the notes are the result of credit deterioration of the underlying portfolio. This is observed through a decline in the average credit rating as measured through the portfolio weighted average rating factor 'WARF' (currently 1271). Since closing the portfolio has experienced 10.5% of defaults and early terminations at a partial loss. The recoveries from these events were used in addition to excess spread proceeds to pay down the Principal Deficiency Ledger, which has been reduced to approx. EUR7.4 million by the repayment of Class A notes according to the August 2009 investor report. Approximately 5.7% of the portfolio is currently flagged in the investor report as under special care, indicating substantial likelihood of default, and approximately 11.6% of the portfolio are currently flagged as under special attention, indicating increased likelihood of default. Moody's has incorporated this forward looking information in its analysis by means of alternative stress runs to the ratings of those obligors. Additional stress scenarios were also run in order to capture the risk related to the non-granularity of the portfolio. These stress scenarios include notching the ratings of a portion of the largest exposures in the portfolio. The rating actions also reflect Moody's revised assumptions with respect to default probability and correlation as described in the press release dated February 4, 2009, titled "Moody's updates key assumptions for rating CLOs." The revised default probability assumptions have been applied to all assets in the underlying portfolio by notching the ratings to levels consistent with the revised assumptions. Correlation levels between the assets have been increased to reflect Moody's revised correlation assumptions. Moody's also notes that the collateral pool consists entirely of debt obligations issued by obligors whose credit quality has been assessed through IKB's internal ratings. These ratings were mapped to Moody's rating scale via a mapping. Moody's has previously used a rating-migration-based model to capture the specific features of these assets. Moody's has updated its model from a migration-based framework to a one based on simulation of impairments (covering defaults, deferrals and write downs affecting the assets), in order to capture the additional risk associated with these hybrid instruments more adequately. While Moody's reviews the levels of stress to be applied to cover deferrals and write downs, it will retain the classes under review for possible downgrade, as the revision of such stresses may adversely affect the ratings. In addition to the quantitative factors that are explicitly modeled, qualitative factors are part of the rating committee considerations. These qualitative factors include the structural protections in each transaction, the recent deal performance in the current market environment, the legal environment, specific documentation features and the potential for selection bias in the portfolio. All information available to rating committees, including macroeconomic forecasts, input from other Moody's analytical groups, market factors, and judgments regarding the nature and severity of credit stress on the transactions, may influence the final rating decision. GENERAL MOTORS: May Sign on Opel Deal With Magna This Week ---------------------------------------------------------- Chris Reiter at Bloomberg reports that General Motors Co. may sign a deal this week to sell a majority stake in Adam Opel GmbH to a group led by Magna International Inc., ceding control of its cash- strapped European arm after 80 years. Contracts are being completed as the parties work through outstanding details, GM Chief Executive Officer Fritz Henderson Said, according to Bloomberg. GM, which won't receive cash, agreed on Sept. 10 to sell 55 percent of Ruesselsheim, Germany- based Opel to Magna and Russian partner OAO Sberbank. "It's quite possible that these documents will be signed this week," Henderson told reporters in Shanghai October 13. The EUR5 billion transaction is backed by Germany, which has been pushing for Opel's sale to Magna since May. Chancellor Angela Merkel's government has offered 4.5 billion euros in loan guarantees to finance the reorganization of the unprofitable division, which employs about half of its 50,000-strong workforce in Germany. About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- as 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. As reported by the Troubled Company Reporter, GM reported net loss of US$6.0 billion, including special items, in the first quarter of 2009. This compares with a reported net loss of US$3.3 billion in the year-ago quarter. As of March 31, 2009, GM had US$82.2 billion in total assets and US$172.8 billion in total liabilities, resulting in US$90.5 billion in stockholders' deficit. General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-50026). General Motors changed its name to Motors Liquidation Co. following the sale of its key assets to a company 60.8% owned by the U.S. Government. The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Bankruptcy Creditors' Service, Inc., publishes General Motors Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Motors Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). HEIDELBERGCEMENT AG: To Sell EUR1 Bln of Bonds to Refinance Debt ---------------------------------------------------------------- John Glover at Bloomberg News reports that HeidelbergCement AG plans to sell at least EUR1 billion (US$1.47 billion) of five- and seven-year bonds to refinance borrowing. Bloomberg relates the company said in a statement on its Web site each portion of the high-yield, or junk, bonds will be at least EUR500 million, with the final amounts and terms dependent on investor demand. According to the statement, the notes will be guaranteed by Hanson Ltd., the company's wholly owned U.K. unit. Citing a banker familiar with the transaction, who declined to be identified, Bloomberg discloses the five-year notes may have a coupon of about 8 percent to 8.5 percent, while the seven-year securities may be priced at about 50 basis points more. The sale five- and seven-year bonds is being managed by Deutsche Bank AG and Royal Bank of Scotland Group Plc and helped by Bank of America Merrill Lynch and Commerzbank AG, Bloomberg notes. About HeidelbergCement Based in Heidelberg, Germany, HeidelbergCement AG (FRA:HEI) -- http://www.heidelbergcement.com/-- is a global producer of cement, concrete and building materials. The Company's core activities include the production and distribution of cement and aggregates, the two raw materials for concrete. It is also engaged in in the provision of such products as ready-mixed concrete, as well as concrete products and elements. It divides its activities into four group areas: Europe-Central Asia, North America, Asia-Australia-Africa-Mediterranean and Group Services. It divides its products into three lines: cement, aggregates and concrete and building products. Its products include sand, gravel, crushed stone, white cement, trass cement, masonry cement, aquament and portland cement for hydraulic engineering, as well as light, heavy and aerated concrete building blocks, pavers, prefabricated ceilings and walls, prefabricated cellar units and prefabricated sewage works units, among others. In 2007, the Company took over Hanson Group. * * * As reported in the Troubled Company Reporter-Europe on Sept. 28, 2009, Moody's Investors Service changed the outlook on HeidelbergCement AG's B1 corporate family rating and B3 instrument ratings to positive from negative. The rating action was prompted by HeidelbergCement's announcement of a successful rights issue for 62.5 million new shares on September 22, 2009. HEIDELBERGCEMENT AG: Moody's Assigns Initial 'B3' Rating on Bonds ----------------------------------------------------------------- Moody's has assigned a provisional (P)B3 rating with LGD5 (81%) to HeidelbergCement's intended bond issue of an unsecured high yield bond. The rating assignment, which is two notches below the B1 corporate family rating, reflects the subordinated position of this bond vis-a-vis the secured bank debt. At the same time, the B1 corporate family rating with a positive outlook remains unchanged. HeidelbergCement has a reasonably diversified geographical footprint with solid market positions, though Moody's notes a relative preponderance of activities in markets which are heavily affected by the economic downturn, such as the US, the UK, and Eastern Europe while the areas which are still holding up to some extent are less represented, such as India and Northern Africa. This profile could lead to overall weaker results than reported by its peers with activities in more positive markets, such as Lafarge or Holcim, despite a successful reduction in the company's cost base. The B1 CFR further reflects the company's high debt load which was put in place with the acquisition of Hanson in 2007 and was recently alleviated by the EUR2.25 billion rights issue. The proposed bond issue is designed to partially rebalance HeidelbergCement's uneven debt maturity profile, with major debt maturities towards the end of 2011/beginning of 2012. However, there still remains a relatively high amount to be refinanced in two years from now. The positive outlook continues to incorporate the expectation that (i) HC will in the intermediate term successfully further extend its debt maturity profile, (ii) HC will generate positive free cash flows in the next years which would be applied to debt reduction and (iii) the operating performance in 2010 will improve based on the expectation that volumes and prices remain roughly flat or slightly positive coupled with implemented cost reductions which should lead over time to improved profitability and cash flows generated, and hence further improved leverage ratios. Moody's would consider an upgrade of HC's ratings if there is sufficient visibility that HC will be able (i) to generate positive free cash flows in 2010 to further repay its debt, (ii) to improve further the debt maturity profile with an extension of debt coming due in 2011 and 2012 with additional measures such as the issuance of bonds, or by the repayment of the debt, and (iii) if the visibility is sufficient to assume that the company's leverage ratios will improve further to levels closer to a debt/EBITDA of 4.0x (per end of June 2009: 5.9x, proforma for the rights issue 4.9x) and RCF/net debt above the mid teens (per end of June 2009: 9.9%, proforma for the rights issue 10.6%) during the course of 2010. Given the continued weak construction markets in which HC is active, such as the US and the UK, Moody's would also be looking for a better visibility regarding the expected development in these markets. Moody's has ranked HeidelbergCement's debt, trade payables and pension liabilities into two categories: the secured bank debt as well as the unsecured debt at operating level, the trade payables and pension liabilities are ranking structurally ahead of HC's capital market instruments given their position which is closer to the cash generating entities. The unsecured debt at holding company level ranks behind the secured bank debt and the other liabilities at operating level. According to HC's loan agreement, 100% of the proceeds of capital market instruments need to be applied to the repayment of the company's syndicated bank facility and therefore reduce the total amount of secured debt in the company's liability structure accordingly. However, despite the reduction of secured debt, this is not sufficient to lower the notching between the corporate family rating and the bond rating according to Moody's loss given default methodology though further reductions in priority debt associated with the positive migration of the CFR could have a positive impact on the rating of unsecured debt. Moody's last rating action on HeidelbergCement on September 24, 2009, was to change the outlook of the company's B1 corporate family rating to positive. HeidelbergCement AG is the world's third-largest cement producer. HC generated sales of EUR5.4 billion in the first six months of fiscal year 2009. With the acquisition of UK building materials producer Hanson plc in mid-2007, HC is now the world's largest producer of aggregates with an annual output in 2007 of 334 mt, and the second-largest producer of ready-mixed concrete with an output of 46 million cubic meters, behind Cemex. HEIDELBERGCEMENT AG: Fitch Puts 'B' Rating on Positive Watch ------------------------------------------------------------ Fitch Ratings has placed Germany-based HeidelbergCement AG's Long- term Issuer Default rating of 'B' on Rating Watch Positive. HC's and subsidiary Hanson Ltd's senior unsecured 'CCC' have also been placed on RWP. This follows HC's announcement that it plans to issue a minimum of EUR1 billion in bonds, divided into two equal tranches with maturities of five and seven years. Fitch has also assigned expected senior unsecured ratings of 'CCC' to the planned issues and has placed the ratings on RWP. The final ratings on the bonds are contingent on Fitch's receipt of final documents conforming to information already received. In addition, HC's Short-term IDR has been affirmed at 'B'. The Recovery Rating on the senior unsecured debt is 'RR6'. "A successful bond issue of at least the target amount would pave the way for further refinancing of the existing secured bank facility, allowing for a progressive reduction in the December 2011 refinancing risk -- a factor that has been weighing on HeidelbergCement's ratings," said Elisabetta Zorzi, Senior Director in Fitch's Corporates group. This would follow the EUR2.25 billion partial repayment made in October of the EUR8.7 billion secured syndicated loan facility. The first partial repayment was made with proceeds from a capital increase which diluted the group's major shareholder -- the Merckle family -- to 24.4% from over 70% and increased free float to 75.6% from 21.2%. Fitch expects to resolve the rating watch following the completion of the bond issue, which is expected in the coming weeks. Should the issuance be successful HC's IDR could be upgraded by up to two notches, while the Recovery Rating on the senior unsecured debt could be revised to 'RR5', due to still material secured debt present in the issuer's capital structure. As per Fitch's Criteria Report "Issuer Default and Recovery Ratings -- Frequently Asked Questions", published on 11 September 2006 and available at www.fitchratings.com, material secured debt is defined for industrials companies as 2x the current level of pre- tax, pre-interest cash flow. Conversely, should HC fail to issue the targeted amount of bonds, the ratings could be affirmed at their current level. Fitch's latest forecasts for HC include a mid-teen percentage point decline in revenue in 2009 and a flat performance in 2010, as well as deteriorating EBITDA margins in 2009 before a slight recovery in 2010. Under this scenario, expected lower cash flow from operations is likely to result in only slightly positive free cash flow compared to a five-year average of 4% free cash flow/revenue. Net leverage is forecast to be below 3.8x by FYE11. TALISMAN-7 FINANCE: Fitch Cuts Rating on Class F Notes to 'B-' -------------------------------------------------------------- Fitch Ratings has downgraded TALISMAN-7 Finance Ltd's EUR1,047.9 million commercial mortgage-backed floating-rate notes, due 2017,: -- EUR611.2 million class A: downgraded to 'AA' from 'AAA'; Outlook Stable -- EUR0.1 million class X: affirmed at 'AAA'; Outlook Stable -- EUR88.1 million class B: downgraded to 'A' from 'AA'; Outlook Stable -- EUR85 million class C: downgraded to 'BBB' from 'A'; Outlook Negative -- EUR67.1 million class D: downgraded to 'BB' from 'A'; Outlook Negative -- EUR47.6 million class E: downgraded to 'B' from 'BBB'; Outlook Negative -- EUR69.5 million class F: downgraded to 'B-' from 'BBB'; Outlook Negative The rating downgrades reflect deteriorating European property market conditions, and especially the impact on loans secured by assets of a secondary nature. This is evidenced in the weighted average Fitch loan-to-value ratio of 93%, as compared to a WA reported LTV of 61%, which implies a market value decline of 35%. The majority of the assets in the portfolio were last valued in December 2006, at the peak of the market, although some assets have been re-valued more recently. The loans are secured by a combination of office, retail, light industrial and multifamily properties located across Germany with an aggregate market value of EUR1,470 million. Fitch's criteria for European CMBS surveillance and criteria for European multifamily loans were used to analyse the quality of the underlying commercial loans. The transaction has significant exposure to the Mozart loan, which alone accounts for 57% of the pool and is secured by a portfolio of 105 mixed properties. The loan's collateral assets are, on average 30% reversionary, although most of this reversion is due to the high level of vacancies in the pool which are 25% by estimated rental value, down 3% since closing. The portfolio has a WA lease length of 3.3 years, compared to an unexpired loan term of 2.4years. A strength of the loan income is its granularity, with the rent roll comprising over 1,000 tenants and the largest tenant accounting for no more than 5% of passing rent. On August 28, 2008, a default notice over the Bruckner loan was issued by the servicer after loan sponsor Level One Holdings entered administration, although the loan has not yet been enforced. The flow of funds from tenants to the borrower collections accounts is not currently in accordance with the facility agreement, with only debt service being paid to the borrower. This issue could have an impact on the amount of cash available to service debt and pay down the loan. Fitch will continue to monitor the performance of the transaction. VAC HOLDING: S&P Downgrades Corporate Credit Rating to 'SD' ----------------------------------------------------------- Standard & Poor's Ratings Services said it lowered its long- and short-term corporate credit ratings on Germany-based magnetic- materials manufacturer VAC Holding GmbH to 'SD' from 'CC/C'. S&P also lowered the issue rating on the EUR135 million senior secured notes issued by VAC Finanzierung GmbH due 2016 to 'D' (default) from 'CC'. The recovery rating remains at '4'. The 'CCC' issue ratings on the senior secured debt issued by VAC KG are unchanged. The recovery ratings on this debt remain '1'. On Oct. 2, 2009, VAC's sponsor One Equity Partners announced the results of a deeply discounted cash offer on VAC Finanzierung's senior secured notes, for which S&P understand that noteholders were paid 40% of the face value on EUR32.7 million of notes. The company has launched a tender offer for up to EUR45 million. S&P understand that upon completion of the offer, VAC's equity sponsor OEP will hold about EUR80 million of the EUR135 million outstanding notes. "Our criteria on distressed exchange offers applies if a related party makes an offer clearly below par, which S&P considers to be the case in this instance," said Standard & Poor's credit analyst Anna Stegert. S&P understands that VAC is still in negotiations with its lenders following its announcement on Sept. 16, 2009, that it is in default under a senior credit facilities agreement with a consortium of banks. S&P understand that should the lenders accelerate the SFA as a result of declaring the event of default, the entire VAC group could potentially be made insolvent. "The uncertainty surrounding the outcome of the negotiations with its banking group is limiting the potential post-exchange corporate credit rating," said Ms. Stegert. "S&P therefore expect to raise the rating on VAC to no higher than 'CC' in the coming days." ============= I C E L A N D ============= EXISTA HF: Deloitte Probed Over Role in Bakkvor Stake Sale ---------------------------------------------------------- Rowena Mason at The Daily Telegraph reports that Deloitte is being investigated in Iceland over its advisory role in the sale of a major stake in Bakkavor, one of the U.K.'s biggest supermarket suppliers. According to the Daily Telegraph, investigators are looking at whether Bakkavor's founders, two London-based millionaire brothers Lydur and Agust Gudmundsson, paid a fair price when they bought a 39% stake at the height of the Icelandic bank crisis a year ago. The Daily Telegraph recalls the Gudmundsson brothers, who control the food company with 5,000 staff in the UK, purchased the stake from their investment company, Exista. Creditors of the heavily-indebted Exista, including Icelandic, British and German banks, are understood to think the price paid for the profitable asset was too low, the Daily Telegraph discloses. The Daily Telegraph relates sources close to one major creditor said it was concerned by the fact that Exista put up the money to finance the sale to the brothers. Headquartered in Reykjavik, Iceland, Exista hf -- http://www.exista.is/-- is engaged in the areas of insurance and asset leasing. It is a parent company within the Exista Group, which provides financial and investment services through its subsidiaries and associates. It operates the Icelandic non-life insurance company VIS, the life insurance company Lifis, the financing company Lysing, and others. Exista is also a shareholder in Kaupthing Bank, Sampo Group, Bakkavor Group and Iceland Telecom, and has other short-term and long-term investments in a diversified portfolio. ========= I T A L Y ========= ALITALIA SPA: Nears Attitech Sale Deal, Ansa Says ------------------------------------------------- Flavia Krause-Jackson at Bloomberg News, citing Ansa, reports that Alitalia SpA is close to selling Atitech SpA, its heavy- maintenance unit, to a group led by Meridie, an investment company owned by businessman Gianni Lettieri. Based in Rome, Alitalia S.p.A. -- http://www.alitalia.it/-- provides air travel services for passengers and air transport of cargo on national, international and inter-continental routes, including United States, Canada, Japan and Argentina. The Italian government owns 49.9% of Alitalia. As reported in the Troubled Company Reporter-Europe on November 7, 2008, Alitalia S.p.A. filed for Chapter 15 protection with the U.S. Bankruptcy Court in the Southern District of New York. Italy's national airline experienced financial difficulties for a number of years caused, in large measure, by a combination of competition from low-cost air carriers, poor management and onerous union obligations, according to papers filed with the court. Despite a EUR1.4 billion state-backed restructuring in 1997, Alitalia posted net losses of EUR256 million and EUR907 million in 2000 and 2001 respectively. Alitalia posted EUR93 million in net profits in 2002 after a EUR1.4 billion capital injection. The carrier booked annual net losses of EUR520 million in 2003, EUR813 million in 2004, EUR168 million in 2005, EUR625.6 million in 2006, and EUR494.64 million in 2007. In the petition filed October 29, 2008, Prof. Augusto Fantozzi, the appointed administrator, said the airline's financial difficulties have been and exacerbated by spiralling fuel prices. On August 29, 2008, Alitalia declared insolvency and filed for commencement of extraordinary administration procedure at the Tribunal of Rome. Italian Prime Minister Silvio Berlusconi appointed Mr. Fantozzi as extraordinary commissioner. Under the Bankruptcy Bill, the Administrator has supplanted the directors and other management of Alitalia. CORDUSIO RMBS: Fitch Downgrades Rating on Class E Notes to 'B' -------------------------------------------------------------- Fitch Ratings has downgraded one and affirmed five tranches of Cordusio RMBS Securitisation S.r.l. - Series 2007 (Cordusio 4). The agency has simultaneously removed the class D and E notes from Rating Watch Negative and assigned Negative Outlooks, amid other rating actions. Cordusio 4 is backed by loans originated by UniCredit Banca SpA issued in May 2007. A full rating breakdown is provided below. -- Class A2 (IT0004231236): affirmed at 'AAA'; Outlook Stable; assigned Loss Severity (LS) Rating of LS-1 -- Class A3 (IT0004231244): affirmed at 'AAA'; Outlook Stable; assigned LS-1 -- Class B (IT0004231285): affirmed at 'AA'; Outlook Stable; assigned LS-2 -- Class C (IT0004231293): affirmed at 'A'; Outlook Stable; assigned LS-2 -- Class D (IT0004231301): affirmed at 'BBB'; removed from RWN; assigned a Negative Outlook; assigned LS-1 -- Class E (IT0004231319): downgraded to 'B' from 'BB'; removed from RWN; assigned a Negative Outlook; assigned LS-3 The negative rating actions taken on classes D and E reflect the higher-than-expected defaults in the transaction. New defaults of 0.20%, 0.43% and 0.34% as of the December 2008, June 2009, and September 2009 investor payment dates, respectively, have been above the excess spread. This has resulted in consecutive reserve fund draws. The RF presently stands at 29.52% of its required value. In September 2009, new defaults of EUR9.23 million caused the RF to be drawn down to EUR1.85 million from EUR2.26 million on the previous IPD. In June 2009 the RF was diminished to EUR2.26 million from the target level of EUR6.25 million, the draw was caused by EUR12.25 million of loans defaulting in the quarter. The RF drew for the first time in December 2008, resulting in Fitch placing the class D and E tranches on RWN at that time. Although it was fully replenished on the March 2009 IPD, due to almost no defaults on the IPD, the RF has showed an overall declining trend since the first draw in December last year. As delinquencies are increasing, Fitch expects that in the following 18 months, defaults will in general be above the excess spread. Therefore the RF will continue being used and could be fully depleted. The class D and E notes have thus been assigned Negative Outlooks as a declining RF has a larger impact on the junior tranches. The transaction benefits from a conservative provisioning mechanism, as all loans are written off as delinquent at between six and 12 months according to the transaction documentation. This mechanism was put in place to reduce the carry cost of defaulted loans until they are foreclosed. This in turn enables an efficient use of the excess spread. Cumulative defaults are 1.27% of the current balance and recoveries on these written-off loans will flow through the payment waterfall when foreclosures are finalized, benefiting the transaction. Fitch used its EMEA RMBS surveillance criteria, employing its credit cover multiple methodology, in reviewing the transaction to assess the level of credit support available to each class of notes. EUROHOME MORTGAGES: Moody's Reviews Ratings on 2007-1 Notes ----------------------------------------------------------- Moody's Investors Service has placed on review for possible downgrade all the rated notes issued by Eurohome Mortgages 2007-1 plc: -- Class A, Placed Under Review for Possible Downgrade; previously on January 30, 2009 Downgraded to Aa1 -- Class B, Placed Under Review for Possible Downgrade; previously on January 30, 2009 Downgraded to A2 -- Class C, Placed Under Review for Possible Downgrade; previously on January 30, 2009 Downgraded to Baa3 -- Class D, Placed Under Review for Possible Downgrade; previously on January 30, 2009 Downgraded to B3 -- Class E, Placed Under Review for Possible Downgrade; previously on January 30, 2009 Downgraded to Ca -- Class X, Placed Under Review for Possible Downgrade; previously on January 30, 2009 Downgraded to Ca The ratings of the German Mortgage Early Repayment Certificates and the Italian Mortgage Early Repayment Certificates are not affected by this rating action. The review for possible downgrade was prompted by the worse-than- expected collateral performance of the underlying portfolio. This may lead to an increase in portfolio loss expectations resulting from higher-than-expected delinquency and default levels in the transaction. Since the last review on January 30, 2009, delinquencies and defaults have increased steeply in the transaction. Both sub- pools have experienced far higher delinquencies than Moody's initial assumptions. Terminated loans in the German sub-pool rose to 12.8% from 8.4% of current balance between November 2008 and October 9. In the Italian sub-pool, cumulative defaults increased to 6.67% of original balance from 2.17% during the same time frame. Outstanding defaults were 7.73% of current balance on the latest payment date (August 2009). While 90+ delinquencies in the German sub-pool seem to be stabilizing at 1.2% of current balance, they have increased to 15.51% from 7.66% in the Italian sub-pool, resulting in a 9.1% delinquency level of the combined pool, which is almost double the 5.0% reached in November 2008. Moody's notes that the transaction has used all of its reserve fund. As of the last payment date, Class E and Class X had unpaid interest of EUR41,108 and EUR49,699, respectively. Class E has an unpaid principal deficiency ledger of EUR1,694,041, while Class X has an unpaid PDL of EUR4,200,000. The provisioning mechanism for loans in the Italian sub-pool that are in arrears by 12 monthly installments led to reserve fund drawings on the interest payment dates between August 2008 and February 2009. By this mechanism, the equivalent of the loan amount of loans in arrears by 12 monthly installments is credited to the PDL and leads to trapping of available excess spread and, if excess spread is insufficient, to drawings on the reserve fund. Based on the amount of delinquent Italian loans and the amount of already terminated German loans, Moody's expects significant additional amounts to be credited to the PDL on future interest payment dates. As part of Moody's detailed transaction review, Moody's will reassess the lifetime loss expectation for the portfolio, reflecting the collateral performance to date as well as the future macro-economic environment. Moody's will also request, whenever not already available, updated loan-by-loan information to revise its MILAN Aaa credit enhancement. Loan-by-loan information will also permit Moody's to validate its assumptions with regards to which loans have a higher default propensity. The lifetime loss and the MILAN Aaa credit enhancement are the key parameters used by Moody's to calibrate its loss distribution curve, which is one of the core inputs in the cash-flow model. The transaction is backed by mortgage loans originated by Deutsche Bank in Germany and Italy and was closed and initially rated in July 2007. During the review, Moody's will also assess the ability of the German and Italian servicers to reduce delinquencies and new defaults and to increase the net present value of recoveries on defaulted assets. Moody's ratings address the expected loss posed to investors by the legal final maturity of the notes. Moody's ratings address only the credit risks associated with the transaction. Other non- credit risks have not been addressed, but may have a significant effect on yield to investors. Moody's will continue to monitor the performance of this RMBS transaction closely. =================== K A Z A K H S T A N =================== ABAT IT: Creditors Must File Claims by October 21 ------------------------------------------------- Creditors of LLP Abat It have until October 21, 2009, to submit proofs of claim to: The Specialized Inter-Regional Economic Court of Almaty Baizakov Str. 273b Almaty Kazakhstan The court commenced bankruptcy proceedings against the company on July 31, 2009. ALATAU BUSINESS: Creditors Must File Claims by October 21 --------------------------------------------------------- LLP Alatau Business Group is currently undergoing liquidation. Creditors have until October 21, 2009, to submit proofs of claim to: Dostyk Ave. 87v Almaty Kazakhstan ALFA ESTATE: Creditors Must File Claims by October 21 ----------------------------------------------------- Creditors of LLP Alfa Estate have until October 21, 2009, to submit proofs of claim to: Jambyl Str. 9 Karaganda Kazakhstan The Specialized Inter-Regional Economic Court of Karaganda commenced bankruptcy proceedings against the company on July 14, 2009, after finding it insolvent. The Court is located at: The Specialized Inter-Regional Economic Court of Karaganda Alalykin Str. 9 Karaganda Kazakhstan KK COMPANY: Creditors Must File Claims by October 21 ---------------------------------------------------- Creditors of LLP KK Company have until October 21, 2009, to submit proofs of claim to: The Specialized Inter-Regional Economic Court of Almaty Baizakov Str. 273b Almaty Kazakhstan The court commenced bankruptcy proceedings against the company on August 3, 2009. OIL SYNTEZ: Creditors Must File Claims by October 21 ---------------------------------------------------- Creditors of LLP Oil Syntez Atyrau have until October 21, 2009, to submit proofs of claim to: Abai Str. 10a Atyrau Kazakhstan The Specialized Inter-Regional Economic Court of Atyrau commenced bankruptcy proceedings against the company on June 2, 2009, after finding it insolvent. The Court is located at: The Specialized Inter-Regional Economic Court of Atyrau Satpaev Str. 3 Atyrau Kazakhstan ROST HOLDING: Creditors Must File Claims by October 21 ------------------------------------------------------ LLP Rost Holding is currently undergoing liquidation. Creditors have until October 21, 2009, to submit proofs of claim to: Transportnaya Str. 17 Pavlodar Kazakhstan SARY ARKA: Creditors Must File Claims by October 21 --------------------------------------------------- Creditors of LLP Sary Arka SW have until October 21, 2009, to submit proofs of claim to: Jambyl Str. 9 Karaganda Kazakhstan The Specialized Inter-Regional Economic Court of Karaganda commenced bankruptcy proceedings against the company on July 14, 2009, after finding it insolvent. The Court is located at: The Specialized Inter-Regional Economic Court of Karaganda Alalykin Str. 9 Karaganda Kazakhstan SELF LLC: Creditors Must File Claims by October 21 -------------------------------------------------- Creditors of LLP Self have until October 21, 2009, to submit proofs of claim to: Kassin Str. 2/2 Mamyr 050052 Almaty Kazakhstan The Specialized Inter-Regional Economic Court of Almaty commenced bankruptcy proceedings against the company on July 14, 2009, after finding it insolvent. The Court is located at: The Specialized Inter-Regional Economic Court of Almaty Baizakov Str. 273b Almaty Kazakhstan SOUTH VENTURES: Creditors Must File Claims by October 21 -------------------------------------------------------- Creditors of LLP South Ventures have until October 21, 2009, to submit proofs of claim to: The Specialized Inter-Regional Economic Court of South Kazakhstan Tynybaev Str. 42 Shymkent Kazakhstan The court commenced bankruptcy proceedings against the company on July 7, 2009. VIT SAN: Creditors Must File Claims by October 21 ------------------------------------------------- Creditors of LLP Vit San have until October 21, 2009, to submit proofs of claim to: Myzy Str. 1 Ust-Kamenogorsk East Kazakhstan Kazakhstan The Specialized Inter-Regional Economic Court of East Kazakhstan commenced bankruptcy proceedings against the company on May 26, 2009, after finding it insolvent. The Court is located at: The Specialized Inter-Regional Economic Court of East Kazakhstan Bajov Str. 2 Ust-Kamenogorsk East Kazakhstan Kazakhstan =================== K Y R G Y Z S T A N =================== STROY MASTER: Creditors Must File Claims by October 28 ------------------------------------------------------ LLC Stroy Master is currently undergoing liquidation. Creditors have until October 28, 2009, to submit proofs of claim to: Baitik Baatyr Str. 36 Bishkek Kyrgyzstan URAN GEO BUR: Creditors Must File Claims by October 28 ------------------------------------------------------ LLC Uran Geo Bur is currently undergoing liquidation. Creditors have until October 28, 2009, to submit proofs of claim to: Shopokov Str. 121/1 Room 513 Bishkek Kyrgyzstan Tel: (+996 312) 30-61-10, (0-775) 98-72-49 ===================== N E T H E R L A N D S ===================== DSB BANK: Placed Under Dutch Central Bank's Control --------------------------------------------------- Jurjen van de Pol and Martijn van der Starre at Bloomberg News report that DSB Bank NV was placed under the control of the central bank. According to Bloomberg, the Amsterdam-based central bank said Monday DSB Bank's solvency is under "great pressure". Bloomberg recalls Pieter Lakeman, chairman of a foundation that represents customers who seek compensation after being overcharged for their mortgages, called for deposit withdrawals at DSB on Dutch public television Oct. 1. Dutch Central Bank President Nout Wellink, as cited by Bloomberg, said capital outflows at DSB amounted to EUR600 million (US$888 million) from that day and the bank currently has about EUR3.5 billion in deposits. Bloomberg relates the central bank said the sale of DSB Bank to a group of five banks including ING Groep NV, ABN Amro Holding NV, Rabobank Groep NV, Fortis Bank Nederland and SNS Reaal NV failed because there was uncertainty about possible claims on DSB for lending too much, failing to meet its responsibilities to clients and possible losses on credits. "The risks were too big and the request for the emergency procedure proved inevitable," Bloomberg quoted the central bank as saying. Bloomberg notes the central bank said the emergency procedure, which places DSB Bank under the control of the central bank, prevents clients from accessing their accounts. According to Bloomberg, the central bank said the court appointed two administrators for DSB Bank and is in the process of naming administrators for DSB's insurance units. DSB Bank -- http://www.dsbbank.com/-- is a fully licensed bank in the Netherlands, providing mortgages, consumer loans, savings and insurance products to retail clients. The bank has a leading market share in the Dutch market for consumer loans. DSB Bank also has operations in Belgium and Germany. DSB Bank, established in 1975, is privately owned by Dirk Scheringa, currently CEO of DSB Bank, Chairman of the Executive Management Board. Mr. Scheringa is also 100% owner of AZ Alkmaar football club, which plays in the Dutch Premier League and president of the Scheringa Museum for Magic Realism, an international collection of more than 500 works of art. GROSVENOR PLACE: Moody's Cuts Rating on Class E Notes to 'Caa3' --------------------------------------------------------------- Moody's Investors Service has taken these rating actions on notes issued by Grosvenor Place CLO II B.V. -- EUR128M Class A-1a Senior Floating Rate Notes due 2023, Downgraded to Aa3; previously on March 12, 2007 Assigned Aaa -- EUR32M Class A-1b Senior Floating Rate Notes due 2023, Downgraded to Aa3; previously on March 4, 2009 Aaa Placed Under Review for Possible Downgrade -- GBP24.3M Class A-2 Senior Floating Rate Notes due 2023, Downgraded to Aa3; previously on March 12, 2007 Assigned Aaa -- EUR80M Class A-3a Senior Revolving Floating Rate Notes due 2023, Downgraded to Aa3; previously on March 12, 2007 Assigned Aaa -- EUR4M Class A-3b Senior Floating Rate Notes due 2023, Downgraded to Aa3; previously on March 4, 2009 Aa1 Placed Under Review for Possible Downgrade -- EUR10M Class A-4 Senior Secured Zero Coupon Accreting Notes due 2023, Downgraded to Aa3; previously on March 12, 2007 Assigned Aaa -- EUR33.5M Class B Senior Floating Rate Notes due 2023, Downgraded to Ba1; previously on March 4, 2009 Aa2 Placed Under Review for Possible Downgrade -- EUR22M Class C Deferrable Interest Floating Rate Notes due 2023, Downgraded to Ba3; previously on Mar 18, 2009 Downgraded to Baa3 and Remained On Review for Possible Downgrade -- EUR25M Class D Deferrable Interest Floating Rate Notes due 2023, Downgraded to Caa2; previously on Mar 18, 2009 Downgraded to B1 and Remained On Review for Possible Downgrade -- EUR14M Class E Deferrable Interest Floating Rate Notes due 2023, Downgraded to Caa3; previously on Mar 18, 2009 Downgraded to Caa1 and Remained On Review for Possible Downgrade -- EUR4M Class Q Combination Notes due 2023, Downgraded to Caa3; previously on March 4, 2009 Ba3 Placed Under Review for Possible Downgrade -- EUR10M Class R Combination Notes due 2023, Downgraded to B3; previously on March 4, 2009 Baa2 Placed Under Review for Possible Downgrade This transaction is a managed cash leveraged loan collateralized loan obligation with exposure to predominantly European senior secured loans, as well as 12.9% exposure to mezzanine loans. The rating actions reflect Moody's revised assumptions with respect to default probability and the calculation of the diversity score as described in the press release dated February 4, 2009, titled "Moody's updates key assumptions for rating CLOs." These revised assumptions have been applied to all corporate credits in the underlying portfolio, the revised assumptions for the treatment of ratings on "Review for Possible Downgrade", "Review for Possible Upgrade", or with a "Negative Outlook" being applied to those corporate credits that are publicly rated. Moody's also notes that a material proportion of the collateral pool consists of debt obligations whose credit quality has been assessed through Moody's credit estimates. As credit estimates do not carry credit indicators such as ratings reviews and outlooks, a stress of a quarter notch-equivalent assumed downgrade was applied to each of these estimates. According to Moody's, the rating actions taken on the notes are also a result of credit deterioration of the underlying portfolio. This is observed through a decline in the average credit rating as measured through the portfolio weighted average rating factor 'WARF' (currently 2666), an increase in the amount of defaulted securities (currently 3.7% of the portfolio), an increase in the proportion of securities from issuers rated Caa1 and below (currently 6.9% of the portfolio), a failure of the Class E par value test, a low diversity score (currently 30) and low collateralization level especially at class B level compare to other similar transactions. These measures were taken or derived from the recent trustee report dated 16 September 2009. Moody's also performed a number of sensitivity analyses, including consideration of a further decline in portfolio WARF quality. Due to the impact of all the aforementioned stresses, key model inputs used by Moody's in its analysis, such as par, weighted average rating factor, and weighted average recovery rate, may be different from trustee's reported numbers. In addition to the quantitative factors that are explicitly modelled, qualitative factors are part of the rating committee considerations. These qualitative factors include the structural protections in each transaction, the recent deal performance in the current market environment, the legal environment, specific documentation features, the collateral manager's track record, and the potential for selection bias in the portfolio. All information available to rating committees, including macroeconomic forecasts, input from other Moody's analytical groups, market factors, and judgments regarding the nature and severity of credit stress on the transactions, may influence the final rating decision. JUBILEE CDO: Moody's Cuts Rating on Class E Notes to 'Caa3' ----------------------------------------------------------- Moody's Investors Service has taken these rating actions on notes issued by Jubilee CDO I-R B.V. -- EUR594M Class A Senior Secured Floating Rate Notes due 2024, Downgraded to Aa1; previously on May 9, 2007 Assigned Aaa -- EUR74.25M Class B Senior Secured Floating Rate Notes due 2024, Downgraded to Baa1; previously on March 4, 2009 Aa2 Placed Under Review for Possible Downgrade -- EUR72M Class C Senior Secured Deferrable Floating Rate Notes due 2024, Downgraded to Ba2; previously on March 17, 2009 Downgraded to Ba1 and Remained On Review for Possible Downgrade -- EUR43.2M Class D Senior Secured Deferrable Floating Rate Notes due 2024, Downgraded to B3; previously on March 17, 2009 Downgraded to B1 and Remained On Review for Possible Downgrade -- EUR33.75M Class E Senior Secured Deferrable Floating Rate Notes due 2024, Downgraded to Caa3; previously on March 17, 2009 Downgraded to Caa1 and Remained On Review for Possible Downgrade -- EUR5M Class P Combination Notes due 2024, Downgraded to Baa1; previously on March 4, 2009 Aa2 Placed Under Review for Possible Downgrade -- EUR8M Class Q Combination Notes due 2024, Downgraded to Ba2; previously on March 4, 2009 A3 Placed Under Review for Possible Downgrade -- EUR5M Class R Combination Notes due 2024, Downgraded to Ba2; previously on March 4, 2009 A3 Placed Under Review for Possible Downgrade This transaction is a managed cash leveraged loan collateralized loan obligation with exposure to predominantly European senior secured loans, as well as approximately 23% mezzanine loan exposure. The rating actions reflect Moody's revised assumptions with respect to default probability and the calculation of the diversity score as described in the press release dated February 4, 2009, titled "Moody's updates key assumptions for rating CLOs." These revised assumptions have been applied to all corporate credits in the underlying portfolio, the revised assumptions for the treatment of ratings on "Review for Possible Downgrade," "Review for Possible Upgrade," or with a "Negative Outlook" being applied to those corporate credits that are publicly rated. Moody's also notes that a material proportion of the collateral pool consists of debt obligations whose credit quality has been assessed through Moody's credit estimates. As credit estimates do not carry credit indicators such as ratings reviews and outlooks, a stress of a quarter notch-equivalent assumed downgrade was applied to each of these estimates. According to Moody's, the rating actions taken on the notes are also a result of credit deterioration of the underlying portfolio. This is observed through a decline in the average credit rating as measured through the portfolio weighted average rating factor 'WARF' (currently 2822), an increase in the amount of defaulted securities (currently 5% of the portfolio), an increase in the proportion of securities from issuers rated Caa1 and below (currently 6.9% of the portfolio). These measures were taken from the recent trustee report dated 10 September 2009. Moody's also performed a number of sensitivity analyses, including consideration of a further decline in portfolio WARF quality. Due to the impact of all the aforementioned stresses, key model inputs used by Moody's in its analysis, such as par, weighted average rating factor, and weighted average recovery rate, may be different from trustee's reported numbers. In addition to the quantitative factors that are explicitly modelled, qualitative factors are part of the rating committee considerations. These qualitative factors include the structural protections in each transaction, the recent deal performance in the current market environment, the legal environment, specific documentation features, the collateral manager's track record, and the potential for selection bias in the portfolio. All information available to rating committees, including macroeconomic forecasts, input from other Moody's analytical groups, market factors, and judgments regarding the nature and severity of credit stress on the transactions, may influence the final rating decision. VIKING DRILLING: Files Plan to Avert Chapter 7 Conversion --------------------------------------------------------- Viking Drilling ASA and its units, including Offshore (USA) Inc., filed a proposed liquidating plan and explanatory disclosure statement where its three semi-submersible offshore drilling rigs will be transferred to a liquidating trust for sale after confirmation, Bill Rochelle at Bloomberg News reported. The Company has been unable to find buyers for the rigs since filing under Chapter 11 in February 2008. The proposed disclosure statement lists the liquidation value of the three vessels at US$2 million to US$7 million. The appraiser, RS Platou, said that two of the rigs may be worth nothing. A separate appraisal said that miscellaneous equipment purchased for US$19.1 million has an estimated liquidation value of US$9.2 million. The Plan, according to Mr. Rochelle, calls for the liquidation trust to sell the property and distribute the proceeds in accordance with priorities under bankruptcy law. The disclosure statement says that the recovery by first- and second-lien debt holders will be less than 50 percent. Unsecured creditors won't see more than 1 percent, according to the disclosure statement. United States Debt Recovery LLC, a buyer of a US$2 million claim, has filed a motion to convert the bankruptcy case to a liquidation in Chapter 7. The conversion motion was pushed back and will be heard together with the hearing for approval of the disclosure statement on Nov. 3. About Viking Drilling Viking Drilling ASA -- http://www.vikingdrilling.com/-- provides offshore drilling. Viking Offshore provides controlled services for each of the rig-owning entities under a managed service agreement. Viking Offshore currently has five employees at its offices in Houston. The Viking Drilling Group, comprised of Viking Drilling ASA and its subsidiaries, owns three out-of- service bare deck semi-submersibles: SS Viking Producer, SS Viking Century, and SS Viking Prospector. Viking Producer, Inc. and Viking Century, Inc. are Liberian corporations fully owned by Viking Drilling ASA. Viking Prospector, Inc. is a Marshall Islands corporation and is also fully owned by Viking Drilling ASA. In February 2008, Oslo, Norway-based Viking Drilling ASA sent its U.S. unit to Chapter 11 bankruptcy in the U.S., citing that the reactivation project of three rigs of SS Viking Producer will result in a major cost overrun. It explained that completing the reactivation project would require significant additional financing requirement. Viking Offshore (USA) Inc., and its affiliates filed for Chapter 11 protection on February 29, 2008 (Bankr. S.D. Tex. Case No. 08- 3121). John P. Melko, Esq. at Gardere Wynne Sewell, LLP represents the Debtors. When they filed for protection from their creditors, the companies listed assets and debts both between US$100 million to US$500 million. Debt includes $86 million of bonds sold in September 2006 and a $60 million second-lien loan from February 2007. Viking also entered into another second-lien loan in December 2007 for $125 million. =========== R U S S I A =========== AVTOVAZ OAO: Net Loss Widens to RUR19.5 Bln in First Half 2009 -------------------------------------------------------------- Anastasia Ustinova at Bloomberg News reports that OAO AvtoVAZ's net loss widened to RUR19.5 billion (US$659 million) from RUR2.15 billion in the first half of 2009 from RUR2.15 billion a year earlier. According to Bloomberg, the carmaker's sales declined 46% to RUR53.1 billion. "The crisis in the financial sector of the Russian economy has negatively affected the automotive market," Bloomberg quoted AvtoVAZ as saying. Without continuing state aid this year and next, market conditions "create a material uncertainty that gives rise to significant doubt about the group�s ability to continue as a going concern." AvtoVAZ, Bloomberg discloses, is relying on the Russian government to help restructure RUR58.2 billion of short-term debt as of June 30. The state has already spent RUR25 billion to support AvtoVAZ, Bloomberg notes. Separately, Bloomberg reports Renault SA and AvtoVaz agreed to build cars together starting in 2012, part of the French automaker's effort to satisfy Russian government demands for aid to forestall dilution of the company�s stake. Bloomberg relates AvtoVAZ President Igor Komarov told reporters Friday at the company's main plant in Togliatti, Russia, the venture would make 300,000 vehicles a year by 2015. Mr. Komarov, as cited by Bloomberg, said AvtoVAZ will provide 25% of the funding, with the remainder coming from Renault�s alliance with Nissan Motor Co. As reported in the Troubled Company Reporter-Europe on Oct. 6, 2009, the FT said Russian prime minister Vladimir Putin gave Renault an ultimatum to either help fund Avtovaz or see its 25% stake in the carmaker reduced. Based in Tolyatti, Russia, AVTOVAZ OAO (AVTOVAZ JSC) -- http://www.lada-auto.ru/-- is engaged in the manufacture of passenger cars. The Company's main brands are LADA PRIORA, LADA Kalina, LADA Samara, LADA 110 and others. The Company is also involved in the manufacture of automobile components, distribution of automobiles and spare parts and operation of automobile service centers. The Company is also active in a variety of other sectors, such as power supply, transportation, utilities, construction, insurance, banking and finance. AVTOVAZ OAO sells its products on the domestic market, as well as exports them to Kazakhstan, Ukraine, Azerbaijan, Armenia, Egypt, Syria, Greece, Belarus, Uruguay, Cyprus, Germany and others. It operates through one representative office located in Moscow, several subsidiaries and affiliated companies. INTER-STROY LLC: Creditors Must File Claims by October 18 --------------------------------------------------------- Creditors of LLC Inter-Stroy (TIN 2312117914, PSRN 1052307172719) (Construction) have until October 18, 2009, to submit proofs of claims to: N. Pavlenko Temporary Insolvency Manager Post User Box 294 420141 Kazan Russia The Arbitration Court of Krasnodarskiy will convene at 11:00 a.m. on February 25, 2010, to hear bankruptcy supervision procedure. The case is docketed under Case No. ?32�13447/2009�14/355B. The Court is located at at: The Arbitration Court of Krasnodarskiy Courtroom 64 Krasnaya Str. 6 Krasnodar Russia POLYMETAL OAO: Fitch Assigns Issuer Default Rating at 'B' --------------------------------------------------------- Fitch Ratings has assigned Russia-based gold and silver producer OAO Polymetal Long-term foreign and local currency Issuer Default Ratings of 'B' and Short-term foreign and local currency IDRs of 'B' respectively. Fitch has also assigned the company a National Long-term rating of 'BBB(rus)'. The Outlooks on all the Long-term ratings are Negative. The ratings reflect Polymetal's extensive gold and silver reserve base, which is expected to support a lifespan of gold and silver mining of more than 15 years. Polymetal is working on significant new projects which, if developed, will enable the company to increase production volumes over the next five years by more than 100%. The company is cost-competitive among global peers, with an average cash cost of US$472/oz in 2008 (versus US$380/oz-US$600/oz and above for other gold companies in 2008) and US$442/oz in H109. Although the company has benefited from the devaluation of the Russian rouble, as the majority of its operating expenses are rouble-denominated, Fitch does not consider this benefit as sustainable. The ratings are constrained by Polymetal's exposure to gold and silver prices, gold and silver yield grades at mines, exchange rate fluctuations and cost inflation. Most of these factors are outside of the company's control. Fitch also notes certain execution risks inherent in the development of new mining projects, including creation of gold processing hubs. Unlike many large market leading mining companies, such as Rio Tinto ('BBB+'/'F2'/Rating Watch Evolving) and Anglo American ('BBB+'/'F2'/Stable), which have wide product diversification, all of Polymetal's operations are in gold and silver production. Fitch also notes that the level of the company's volume, revenue and EBITDAR is small in comparison to other gold mining peers rated by the agency, which limits Polymetal's financial flexibility and ability to attract new financing and/or renegotiate existing debt. Polymetal's creditworthiness is also constrained by its limited geographical reach, as the company's strategy is to continue as a regional player in the Commonwealth of Independent States (CIS). This renders the company vulnerable to volatile economic and political conditions in CIS countries. In Fitch's view, Polymetal's performance in FY08 and H109 was underpinned by favourable gold and silver industry trends, with prices substantially exceeding the 30-year historical average (US$550/oz for gold and US$7/oz per silver) Using Fitch's modelling assumptions of an average gold price of US$900/oz and an average silver price of US$13/oz in 2009, the agency estimates Polymetal's 2009 revenue will grow 0.5%-1.5% y-o-y and its EBITDAR margin will be 38%-45%. As of end-H109, the company had total debt of US$448 million, of which US$423 million was short-term. All the debt was unsecured. The company is looking to refinance its existing short-term debt and extend the maturity of its debt portfolio through issuing RUB bonds for a total of RUB5bn. Fitch estimates Polymetal's FY09 gross leverage (gross debt/EBITDAR) at 1.7x-1.9x and net leverage (net debt/EBITDAR) at 1x-1.2x. Fitch considers the company's short-term liquidity as adequate. For H209 Fitch forecasts a cash inflow of US$290 million-US$320 million from free cash flow generation and proceeds from rouble bond issuance and new equity, compared with a cash outflow of US$180 million-US$220 million for debt repayment. The Negative Outlook reflects Fitch's concerns about the company's liquidity in 2011, due to a potential peak of debt repayment, estimated by Fitch at US$250 million-US$350 million, as a result of a possible exercise of a put option of Polymetal's rouble bonds and maturing debt. Given Polymetal's expected free cash flow of US$30 million-60 million in 2011, the agency believes the company may face significant liquidity risks should it be unable to raise new debt and/or renegotiate its existing debt. TEKH-PROM LLC: Creditors Must File Claims by October 18 ------------------------------------------------------- Creditors of LLC Tekh-Prom-Stroy (TIN 6229054053, PSRN 1066229060149) (Construction) have until October 18, 2009, to submit proofs of claims to: Yu.Artemova Insolvency Manager Michurina Str. 11 Ramzay Mokmanskiy 442395 Penzenskaya Russia The Arbitration Court of Ryazanskaya commenced bankruptcy proceedings against the company after finding it insolvent. The case is docketed under Case No. ?54�330/2009. The Debtor can be reached at: LLC Tekh-Prom-Stroy Molodezhnaya Str. 25A 390010 Ryazan Russia ULYANOSKIY AMMUNITION: Creditors Must File Claims by October 18 --------------------------------------------------------------- Creditors of LLC Ulyanovskiy Ammunition Factory (TIN 7328511961, PSRN 1077328065616) have until October 18, 2009, to submit proofs of claims to: Yu.Ovchinnikov Temporary Insolvency Manager Fedoseenko Str. 17-104 Saransk 430001 Mordovia Russia The Arbitration Court of Ulyanovskaya will convene on January 14, 2010, to hear bankruptcy supervision procedure. The case is docketed under Case No. ?72�12060/2009. The Debtor can be reached at: LLC Ulyanovskiy Ammunition Factory Shoferov Str. 1 432007 Ulyanovsk Russia VERKHNEKAMSK-LES: Kirovskaya Bankruptcy Hearing Set October 22 -------------------------------------------------------------- The Arbitration Court of Kirovskaya will convene at 9:30 a.m. on October 22, 2009, to hear bankruptcy supervision procedure on OJSC Verkhnekamsk-Les (TIN 4305000475, PSRN 1024300572010)(Forestry). The case is docketed under Case No. ?28�4510/2009�108/6. The Temporary Insolvency Manager is: OJSC Verkhnekamsk-Les Moskovskaya Str. 40 Sadakovskiy 610913 Kirov Russia The Debtor can be reached at: OJSC Verkhnekamsk-Les Oktyabrskaya Str. 1 Kirs 612820 Kirovskaya Russia ZAPADNO-SIBIRSKAYA: Creditors Must File Claims by October 18 ------------------------------------------------------------ Creditors of LLC Zapadno-Sibirskaya Drilling Company (TIN 8601031907, PSRN 1078601001896) have until October 18, 2009, to submit proofs of claims to: V. Yarkova Temporary Insolvency Manager Internatsionalnaya Str. 18-184 Nizhnevartovsk 628600 Khanty-Mansiysk Russia The Arbitration Court of Khanty-Mansiysk will convene at 09:00 a.m. on February 1, 2010, to hear bankruptcy supervision procedure. The case is docketed under Case No. ?75-7123/2009. The Court is located at: The Arbitration Court of Khanty-Mansiysk Courtroom 317 Lenina Str. 54/1 Khanty-Mansiysk Russia The Debtor can be reached at: LLC Zapadno-Sibirskaya Drilling Company Stroiteley Str. 12 628405 Khanty-Mansiysk Russia ZIMINSKIY BRICK: Kemerovskaya Bankruptcy Hearing Set October 22 --------------------------------------------------------------- The Arbitration Court of Kemerovskaya will convene at 11:00 a.m. on October 22, 2009, to hear bankruptcy supervision procedure on LLC Ziminskiy Brick Plant. The case is docketed under Case No. ?27�7322/2009. The Temporary Insolvency Manager is: A. Samokhin 40 let Oktyabrya Str. 30 Prokopyevsk 653013 Kemerovskaya Russia The Debtor can be reached at: LLC Ziminskiy Brick Plant 40 let Oktyabrya Str. 30 Prokopyevsk 653013 Kemerovskaya Russia ========= S P A I N ========= DOGI INTERNATIONAL: Posts EUR25.6 Million Loss in First Half 2009 ----------------------------------------------------------------- Ivan Castano Freeman at just-style reports that bankrupt Spanish stretch fibers firm Dogi International Fabric posted a EUR25.6 million (US$37.7 million) loss in the first half of 2009, up from EUR6.6 million in the same 2008 period. According to just-style, the company's first-half results were hurt by restructuring costs and plunging sales. ===================== S W I T Z E R L A N D ===================== CIRRUS SWISS: Claims Filing Deadline is December 2 -------------------------------------------------- Creditors of Cirrus Swiss Personal GmbH are requested to file their proofs of claim by December 2, 2009, to: Trigema AG Zentralstrasse 3 8003 Zurich Switzerland The company is currently undergoing liquidation in Zurich. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on August 5, 2009. DECO 15: Fitch Junks Ratings on Two Classes of Notes ---------------------------------------------------- Fitch Ratings has downgraded six classes of DECO 15 - Pan Europe 6 Ltd and affirmed the class A1 tranche. The rating actions are: -- EUR660.6 million class A1 due July 2014 (XS0307398841) affirmed at 'AAA'; Outlook Stable -- EUR296.8 million class A2 due July 2014 (XS0307400258) downgraded to 'AA' from 'AAA'; Outlook Negative -- EUR148.4 million class A3 due July 2014 (XS0307400506) downgraded to 'A' from 'AAA'; Outlook Negative -- EUR87 million class B due July 2014 (XS0307401140) downgraded to 'BBB-' from 'AA'; Outlook Negative EUR88.5 million class C due July 2014 (XS0307405133) downgraded to 'B' from 'A'; Outlook Negative -- EUR57.2 million class D due July 2014 (XS0307405729) downgraded to 'CCC' from 'BBB+'; assigned Recovery Rating 'RR5' -- EUR21.6 million class E due July 2014 (XS0307406453) downgraded to 'CC' from 'BBB'; assigned Recovery Rating 'RR6' The downgrade reflects the impact on the 10 remaining loans in the portfolio of the downturn in the European commercial real estate market. The total loan portfolio had a reported weighted-average loan-to-value ratio of 73.2% at the July 2009 interest payment date. This compares to a Fitch WA LTV of 96.7%, reflecting an overall market value decline of 26.5%. Fitch's criteria for European CMBS surveillance were used to analyze the quality of the underlying commercial loans. The portfolio is highly leveraged; five of the 10 loans have LTV ratios in excess of 80%, with three of the loans pushing closer to 90% as reported by the servicer. The presence of B-notes in four of the loans further increases overall leverage at these loans and could complicate re-financings of the affected loans. Despite this, the portfolio currently benefits from above average coverage. The WA interest coverage ratio on the total portfolio has improved to 1.5x on the securitized portion of the portfolio, while the whole loan ICR increased to 1.4x. This compares to a securitized ICR of 1.4x and a whole loan ICR of 1.3x at closing. CentrO, the largest loan in the portfolio accounting for 55.4% of the outstanding debt balance, is secured by a super-regional shopping centre located in Oberhausen. The large concentration within the portfolio is mitigated by the high quality of this asset. The senior loan benefits from soft amortization of 75% of all excess cash flow, resulting in a projected balloon Fitch LTV of 94.7%, compared to a current Fitch LTV of 101.1%. The WA remaining lease term at the centre is currently 4.2 years (versus a remaining loan term of 4.7 years.) Approximately 25% of current rental income will expire in 2011; however, there is an interest shortfall reserve of EUR5.2 million to mitigate the tenant rollover. This reserve can be used to meet re-letting costs expenses primarily attributed to the leases scheduled to expire in 2010 and 2011. The second largest loan in the portfolio, Mansford OBI Large (10.7%) predominantly let on long leases to OBI, a large German DIY retailer, has also performed well since closing. The loan benefits from a long unexpired lease term of 12.4 years compared with the loan maturity falling in July 2012.. The euro-funded transaction contains two loans denominated in Swiss francs (Habas and Fishman Coop III loans, 7.7% of pool balance). Issuer-level currency hedging means that the probability of a loss being suffered by the issuer is determined by the respective borrowers' ability to pay, and not by currency fluctuations; however, should a loss be suffered on these loans, noteholders' exposure could be compounded by an appreciation of the Swiss Franc relative to the euro. Fitch has reflected this risk in its credit analysis. Fitch will continue to monitor the performance of the transaction. EXELL TRAINING: Claims Filing Deadline is October 30 ---------------------------------------------------- Creditors of Exell Training AG are requested to file their proofs of claim by October 30, 2009, to: Peter Boermann Wartenbergstrasse 25 4103 Bottmingen Switzerland The company is currently undergoing liquidation in Bottmingen. The decision about liquidation was accepted at an extraordinary general meeting held on August 19, 2006. GASTRO WIPKINGER: Claims Filing Deadline is November 9 ------------------------------------------------------ Creditors of Gastro wipkinger GmbH are requested to file their proofs of claim by November 9, 2009, to: Saribas Riza Liquidator Schwammendingenstrasse 24 8050 Zurich Switzerland The company is currently undergoing liquidation in Zurich. The decision about liquidation was accepted at a shareholders' meeting held on January 22, 2009. GJR GERMAN: Claims Filing Deadline is November 30 ------------------------------------------------- Creditors of GJR German Private Equity Partners AG are requested to file their proofs of claim by November 30, 2009, to: Mattig-Suter und Partner Industriestr. 22 6302 Zug 6318 Walchwil Switzerland The company is currently undergoing liquidation in Zug. The decision about liquidation was accepted at an extraordinary general meeting held on June 29, 2009. KLOPFSTEIN HOLDING: Claims Filing Deadline is November 2 -------------------------------------------------------- Creditors of Klopfstein Holding AG are requested to file their proofs of claim by November 2, 2009, to: Fritz Klopfstein Liquidator Neueneggstrasse 10 3177 Laupen Switzerland The company is currently undergoing liquidation in Laupen. The decision about liquidation was accepted at an extraordinary general meeting held on August 14, 2009. SAG ALUTRADING: Claims Filing Deadline is November 2 ---------------------------------------------------- Creditors of Sag Alutrading AG are requested to file their proofs of claim by November 2, 2009, to: Sag Alutrading AG Grossmatt 3 6052 Hergiswil Switzerland The company is currently undergoing liquidation in Hergiswil NW. The decision about liquidation was accepted at an extraordinary general meeting held on August 20, 2009. SPOERRI TRANSPORTE: Claims Filing Deadline is October 21 --------------------------------------------------------- Creditors of Spoerri Transporte GmbH are requested to file their proofs of claim by October 21, 2009, to: Spoerri Transporte GmbH Dorfstrasse 22 5417 Untersiggenthal Switzerland The company is currently undergoing liquidation in Untersiggenthal. The decision about liquidation was accepted at an extraordinary shareholders' meeting held on December 3, 2008. TAURUS CMBS: Fitch Downgrades Rating on Class D Notes to 'B' ------------------------------------------------------------ Fitch Ratings has downgraded Taurus CMBS (Pan Europe) 2006-3 PLC's class A to D notes. All classes of notes have Negative Outlooks. The rating actions are: -- EUR281.5 million class A due May 2015 (XS0274566420) downgraded to 'AA' from 'AAA'; Outlook Negative -- EUR62.6 million class B due May 2015 (XS0274569523) downgraded to 'BBB' from 'AA'; Outlook Negative -- EUR22.3 million class C due May 2015 (XS0274570372) downgraded to 'BB' from 'A'; Outlook Negative -- EUR10.9 million class D due May 2015 (XS0274570703) downgraded to 'B' from 'BBB'; Outlook Negative The rating actions reflect uncertainty over the refinancing of the collateral loans, particularly given their relatively short terms to maturity, the constrained property lending environment and the prevailing negative sentiment in European property markets. Fitch's criteria for European CMBS surveillance was used to analyze the quality of the underlying commercial loans. Taurus CMBS (Pan Europe) 2006-3 PLC is a securitization currently comprising six commercial mortgage loans originated by subsidiaries of Merrill Lynch & Co. ('A+'/'F1+'/Outlook Stable), which closed in November 2006. In September 2009 the Dubendorf Loan was fully repaid, and the Epic Loan partially prepaid, leaving the loan pool with a current balance of EUR312 million, redemption proceeds will be applied to the notes in accordance with the documents on the November 2009 interest payment date. Of the remaining loans, three are scheduled to mature in 2010, one in 2011 and two in 2013. While all are currently performing, Fitch estimates the weighted average loan-to-value ratio for the remaining securitised portfolio to be 92%, compared to a current reported LTV of 67.3% based on valuations conducted in December 2008 and February 2009 for the Epic and Triumph loans and prior to closing for the other loans, implying a WA market value decline of 27% since the latest valuations. The Epic loan remains the largest exposure in the portfolio with a current outstanding balance of CHF164.2m and is the A note of a larger whole loan. It is now secured by three Swiss regional shopping centres, all anchored by COOP and/or Migros. Fitch estimates the current LTV of the A note to be 90%, implying an MVD of 27% versus the reported valuation as at December 2008. The loan is scheduled to mature in January 2011. The K-Berg Loan has a current outstanding balance of CHF38.4 million and is the A note of a larger whole loan. It is secured by a campus of industrial and office properties, fully let to Soudronic AG on a lease with over 11 years remaining, and located 20km outside Zurich. If the current tenant experiences financial difficulties it may be difficult to find a replacement tenant for the property. The current Fitch LTV of the loan is 138%, implying an MVD of 49% versus the reported valuation as at February 2006. The loan is scheduled to mature in April 2013. The Trafalgar Loan has a current outstanding balance of CHF93.9 million and is the A note of a larger whole loan. It is secured by a single office property located in a secondary office district of Zurich and fully let to the University of Zurich on a lease with 6.3 years remaining. Fitch estimates the asset's value to have fallen since closing. The agency estimates the current LTV to be 93%, implying an MVD of 21% versus the reported valuation as at October 2005. The loan is scheduled to mature in October 2010. Fitch will continue to monitor the performance of the transaction, particularly those loans that are approaching their maturity dates. TEAK-HOUSE: Claims Filing Deadline is November 16 ------------------------------------------------- Creditors of Teak-House GmbH are requested to file their proofs of claim by November 16, 2009, to: Myrta Ting Seckistrasse 17 Mail box:68 6318 Walchwil Switzerland The company is currently undergoing liquidation in Walchwil. The decision about liquidation was accepted at an extraordinary shareholderd' meeting held on August 14, 2009. WALDMEIER HOLDING: Claims Filing Deadline is November 10 ------------------------------------------------------- Creditors of Waldmeier Holding AG are requested to file their proofs of claim by November 10, 2009, to: Dr. R. Sigg and K. Schneiter Zihlackerstrasse 8 4153 Reinach Switzerland The company is currently undergoing liquidation in Reinach BL. The decision about liquidation was accepted at an extraordinary general meeting held on August 14, 2009. XAGX RAPPERSWIL: Claims Filing Deadline is November 27 ------------------------------------------------------ Creditors of Xagx Rapperswil AG are requested to file their proofs of claim by November 27, 2009, to: Hans-Rudolf Meier Liquidator Hinterfeld 3b 8852 Altendorf Switzerland The company is currently undergoing liquidation in Rapperswil-Jona SG. The decision about liquidation was accepted at an extraordinary general meeting held on July 10, 2009. ============= U K R A I N E ============= BUDISCHE FURNITURE: Creditors Must File Claims by October 17 ------------------------------------------------------------ Creditors of CJSC Budische Furniture Plant (code EDRPOU 22797358) have until October 17, 2009, to submit proofs of claim to: N. Zanko Insolvency Manager Office 409 Heroes of Dniepr Str. 81 18021 Cherkassy Ukraine The Economic Court of Cherkassy commenced bankruptcy proceedings against the company on September 9, 2009. The case is docketed under Case No. 01/1685. The Court is located at: The Economic Court of Cherkassy Shevchenko Blvd. 307 18004 Cherkassy Ukraine The Debtor can be reached at: CJSC Budische Furniture Plant Shevchenko Str. 3 Budische Cherkassy Ukraine CLIMATE ENGINEERING: Creditors Must File Claims by October 17 ------------------------------------------------------------- Creditors of LLC Climate Engineering Ukraine (code EDRPOU 35661026) have until October 17, 2009, to submit proofs of claim to: LLC Masterplan Insolvency Manager Melnikov Str. 12 04050 Kiev Ukraine The Economic Court of Kiev commenced bankruptcy proceedings against the company on September 1, 2009. The case is docketed under Case No. 44/471-B. The Court is located at: The Economic Court of Kiev B. Hmelnitskiy Str. 44-b 01030 Kiev Ukraine The Debtor can be reached at: LLC Climate Engineering Ukraine Office 123 Gaydar Str. 27a 01001 Kiev Ukraine GELENA SIM: Creditors Must File Claims by October 17 ---------------------------------------------------- Creditors of LLC Gelena Sim (code EDRPOU 33225832) have until October 17, 2009, to submit proofs of claim to A. Olefirenko, the company's insolvency manager. The Economic Court of Kiev commenced bankruptcy proceedings against the company on September 7, 2009. The case is docketed under Case No. 44/548-B. The Court is located at: The Economic Court of Kiev B. Hmelnitskiy Str. 44-b 01030 Kiev Ukraine The Debtor can be reached at: LLC Gelena Sim Office 514 Krasnozvezdny Ave. 119 03039 Kiev Ukraine MINKO LLC: Creditors Must File Claims by October 17 --------------------------------------------------- Creditors of LLC Minko (code EDRPOU 25523070) have until October 17, 2009, to submit proofs of claim to: J. Talan Insolvency Manager Post Office Box 1221 Krivoy Rog 50027 Dnepropetrovsk Ukraine The Economic Court of Dnepropetrovsk commenced bankruptcy proceedings against the company on September 21, 2009. The case is docketed under Case No. B24/370-08. The Court is located at: The Economic Court of Dnepropetrovsk Kujbishev Str. 1a 49600 Dnepropetrovsk Ukraine The Debtor can be reached at: LLC Minko Televizionnaya Str. 2 Krivoy Rog 50086 Dnepropetrovsk Ukraine NAKRATORG LTD: Creditors Must File Claims by October 17 ------------------------------------------------------- Creditors of LLC Nakratorg Ltd. (code EDRPOU 36304225) have until October 17, 2009, to submit proofs of claim to A. Olefirenko, the company's insolvency manager. The Economic Court of Kiev commenced bankruptcy proceedings against the company on September 7, 2009. The case is docketed under Case No 44/549-B. The Court is located at: The Economic Court of Kiev B. Hmelnitskiy Str. 44-b 01030 Kiev Ukraine The Debtor can be reached at: LLC Nakratorg Ltd. Kikvidze Str. 12 01103 Kiev Ukraine OLIMPIC CASINO: Creditors Must File Claims by October 17 -------------------------------------------------------- Creditors of LLC Olimpic Casino Ukraine (code EDRPOU 329962970) have until October 17, 2009, to submit proofs of claim to: S. Donkov Insolvency Manager Office 6 Gorky Str. 10 01004 Kiev Ukraine The Economic Court of Kiev commenced bankruptcy proceedings against the company on September 7, 2009. The case is docketed under Case No. 44/516-B. The Court is located at: The Economic Court of Kiev B. Hmelnitskiy Str. 44-b 01030 Kiev Ukraine The Debtor can be reached at: LLC Olimpic Casino Ukraine Office 514 Khreschatik Str. 16 01001 Kiev Ukraine =========================== U N I T E D K I N G D O M =========================== AER LINGUS: May Face Insolvency if Pension Scheme Changes Rejected ------------------------------------------------------------------ David Clerkin at The Sunday Business Post Online reports that Aer Lingus Group plc could face insolvency if the airline's staff does not agree to radical changes to its main employee pension scheme and the airline is forced to take on the scheme's EUR460 million deficit. The Post.ie relates the airline told pension scheme trustees recently that it could not address the deficit in existing schemes through higher contributions, as this could trigger a change to the schemes, accounting treatment. According to the Post.ie, such changes could include forcing the airline to recognize some or all of the deficits on its balance sheet, creating a new liability that could trigger its insolvency. As reported in the Troubled Company Reporter-Europe on Oct. 9, 2009, The Financial Times said Aer Lingus plans to cut a fifth of its workforce in a EUR97 million (GBP90 million) cost-cutting program. The FT disclosed the company, which has been hit by falling fares and higher fuel bills, is launching a two-stage "transformational restructuring plan" in an effort to restore profitability. According to the FT, the FT plan, involves 676 redundancies, including 489 among pilots, cabin crew and ground staff, and 187, or 40% of its back-office staff. Aer Lingus Group Plc and its subsidiaries -- http://www.aerlingus.com/-- operates as a low fares Irish airline primarily providing passenger and cargo transportation services from Ireland to the United Kingdom and Europe (short haul) and also to the United states (long haul). The Company is primarily organized into two segments: passenger, which includes revenues and costs relating to the carriage of passengers, and cargo, which relates to the revenues and costs from the transportation of cargo. During the year ended December 31, 2008, three group companies (Seres Limited, Duneast Limited and Crodley Limited) were put into liquidation and dissolved. CATTLES PLC: FSA Conducts Probe Over Provisions for Bad Loans ------------------------------------------------------------- Sharlene Goff and Brooke Masters at The Financial Times report that Cattles plc is being investigated by the Financial Services Authority over how it accounted for bad loans. According to the FT, people familiar with the investigation said the FSA was looking at whether Cattles and its executives lived up to their obligations to make timely and accurate announcements about the company's increasingly dire financial situation. The FT says one area of focus is likely to be the successful GBP200 million rights issue it launched in April 2008. The regulator is also expected to investigate whether the company moved quickly enough to tell the market of the problems it discovered with its impairment provisions earlier this year, the FT notes. The FT recalls Cattles has admitted to a breakdown in internal controls, which resulted in its impairment policies being incorrectly applied. The company said it may have to take up to a further GBP850 million (US$1.3 billion) of impairment provisions, the FT relates. Standstill As reported in the Troubled Company Reporter-Europe on Sept. 18, 2009, Cattles said it is progressing with its discussions to agree a standstill agreement with representatives of its key financial creditors. A draft of the heads of terms for a standstill agreement is now being considered by the key financial creditors and by the board of Cattles and relevant subsidiaries. The company said it is not certain that these financial creditors will approve the heads of terms or that a standstill agreement will be successfully concluded. Cattles plc -- http://www.cattles.co.uk/-- is a financial services company specializing in providing consumer credit to non- standard customers in United Kingdom. The Company also provides debt recovery services to external clients and its consumer credit business, and working capital finance for small- and medium-sized businesses. It also has a car retail operation, which is an introducer of hire purchase customers to its consumer credit business. Its business divisions include Welcome Financial Services, The Lewis Group and Cattles Invoice Finance. Welcome Financial Services consists of three businesses: Welcome Finance, Shopacheck and Welcome Car Finance. Shopacheck provides short- term home collected loans to some 260,000 customers through 52 branches. The Lewis Group provides debt recovery and investigation services, serving both external clients and Welcome Financial Services. In September 2007, it announced the acquisition of a debt portfolio of United Kingdom credit card, loan and overdraft receivables. CORE: Tenon Recovery Appointed as Administrators ------------------------------------------------ Further to the announcement made on September 25, the Board of Core has agreed to appoint Tenon Recovery as Administrators under the Insolvency Act 1986. A further announcement will be made when possible regarding the Administrators proposals to restructure the Company. The Core Business was established in May 2004 by Stirling Murray to create, develop, launch and distribute personal care and beauty brands. It also provides consultancy and brand management services. The Company was listed on AIM in March 2006 under the ticker 'CORE.' GENERAL MOTORS: Magna Won't Make Compulsory Job Cuts at Vauxhall ---------------------------------------------------------------- Beth Mellor at Bloomberg News reports that Britain's Unite union said Magna International Inc., which is concluding a deal to buy General Motors Co.'s Opel unit, agreed not to make compulsory job cuts at the division's U.K. plants employing more than 5,000 people. Bloomberg relates Unite said in a statement Magna pledged to raise production at the Vauxhall brand's Ellesmere Port factory to 147,500 cars a year by 2011 and guaranteed manufacturing at its Luton site, saving 600 jobs that would otherwise have been lost. Magna, which has called for EUR1.2 billion (US$1.8 billion) of cost cuts at Opel, confirmed that an agreement had been reached at Vauxhall while declining to give details, Bloomberg notes. Spain Citing Chema Fernando, a labor representative, Bloomberg discloses Magna failed to reach a settlement in Madrid yesterday after resubmitting an earlier business plan for Opel's plant in Figueruelas, Spain, during a meeting with unions and government officials. According to Bloomberg, an Industry Ministry official said yesterday in a phone interview Magna later provided the government with a new plan for the Figueruelas factory that would sustain its operations for a minimum five to 10 years. The Spanish union said the parties plan to meet again today, Oct. 14. About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- as 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. As reported by the Troubled Company Reporter, GM reported net loss of US$6.0 billion, including special items, in the first quarter of 2009. This compares with a reported net loss of US$3.3 billion in the year-ago quarter. As of March 31, 2009, GM had US$82.2 billion in total assets and US$172.8 billion in total liabilities, resulting in US$90.5 billion in stockholders' deficit. General Motors Corporation and three of its affiliates filed for Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case No. 09-50026). General Motors changed its name to Motors Liquidation Co. following the sale of its key assets to a company 60.8% owned by the U.S. Government. The Honorable Robert E. Gerber presides over the Chapter 11 cases. Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors in their restructuring efforts. Al Koch at AP Services, LLC, an affiliate of AlixPartners, LLP, serves as the Chief Executive Officer for Motors Liquidation Company. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsel. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP. Bankruptcy Creditors' Service, Inc., publishes General Motors Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by General Motors Corp. and its various affiliates. (http://bankrupt.com/newsstand/or 215/945-7000). INCA TECHNOLOGY: In Administration; Leonard Curtis on Board ----------------------------------------------------------- Further to the announcement on September 25, 2009, the Company announced that N. A. Bennett and M. C. Healy at Leonard Curtis of One Great Cumberland Place, Marble Arch London W1H 7LW, were appointed as administrators to Inca Technology International Limited on October 8, 2009 under the Insolvency Act 1986. The administrators are currently negotiating the sale of certain assets of Inca Technology and a further announcement will be made in due course. This process does not affect any other company within the Avisen group. Louis Peacock, a director of Avisen, is also a director of Inca Technology. ITV PLC: Sir Michael Bishop Drops Out of Chairman Race ------------------------------------------------------ Ben Fenton, Salamander Davoudi and Philip Stafford at The Financial Times report that Sir Michael Bishop -- the airline entrepreneur behind BMI and the board's preferred candidate for chairman -- pulled out of talks to take the post following consultations with major investors including its largest shareholder and business rival, British Sky Broadcasting. Citing people with knowledge of the discussions, the FT discloses Mr. Bishop told the board of his decision after his conversations with ITV's main investors convinced him that the chairman's job was too complex for him to manage in the time he could devote to it. The FT relates a spokesman for Mr. Bishop said that he took the decision "after conducting a thorough review of the position and its responsibilities". About ITV plc ITV plc -- http://www.itvplc.com/-- is a United Kingdom-based advertising funded broadcaster. The Company also operates as an advertising funded media owner in the United Kingdom across all media, including television, radio, press, cinema, outdoor and the Internet. As a producer, ITV makes hours of network television. Its digital channels include ITV2, ITV3, ITV4 and Citv. ITV also makes programs for the BBC, Channel 4, five, Sky and other broadcasters. ITV produces programs watched on screens from San Francisco to Sydney. In addition, it produces a range of products related to ITV programs, such as digital video disks (DVDs) and computer games. Its online properties include itv.com, itvlocal.com and Friends Reunited * * * As reported in the Troubled Company Reporter-Europe on Sept. 18, 2009, Standard & Poor's Ratings Services said that it has lowered its long-term corporate credit and senior unsecured debt ratings on U.K. private TV broadcaster ITV PLC to 'B+' from 'BB-'. S&P said the outlook is negative. At the same time, S&P affirmed its 'B' short-term corporate credit rating on ITV. JJB SPORTS: To Push Through with GBP100 Million Fundraising ----------------------------------------------------------- Kiran Stacey at The Financial Times reports that JJB Sports plc will pursue its GBP100 million fundraising after investors were persuaded that allegations surrounding the financial dealings of its chairman were false. According to the FT, JJB intends to issue a firm placing and a placing and open offer, priced at 25p each, underwritten by Panmure Gordon and Numis Securities. The fundraising will be put to a shareholder vote on October 29, the FT discloses. As reported in the Troubled Company Reporter-Europe on Oct. 13, 2009, the FT said JJB was forced to delay the share placing on Friday after shareholders asked for clarification on the repayment of a loan received by Sir David Jones, its chairman, from Mike Ashley, owner of Sports Direct. In an Oct. 9 report, FT disclosed analysts warned the company might face financial problems if it did not complete the fundraising. According to the FT, JJB needs the cash to give it breathing space after its losses soared to GBP42.9 million in the first six months of the year. John Taylor at The Daily Telegraph reports David Herro, chief investment officer at Harris Associates, which holds a 14.5% stake in JJB, has called on the Financial Services Authority should bring criminal charges against those responsible for circulating rumors about the personal financial affairs of Mr. Jones. Mr. Herro, as cited by the Daily Telegraph, said the rumors were part of a "planned, concerted attempt to destabilize" the company. "Anyone who is caught manipulating a capital raising using false data should be prosecuted," the Daily Telegraph quoted the JJB shareholder as saying. About JJB Sports Headquartered in Wigan, England, JJB Sports plc -- http://www.jjbcorporate.co.uk/-- is engaged in the retailing of sportswear and sporting equipment. The company also operates a chain of fitness clubs, which has a smaller number of indoor soccer centers attached to them. It also operates a television broadcasting and marketing business, which specializes in the marketing of golf products and fitness equipment through Sky Television. LADBROKES PLC: Fitch Affirms Issuer Default Rating to 'BB+' ----------------------------------------------------------- Fitch Ratings has affirmed UK-based betting operator Ladbrokes PLC's Long-term Issuer Default and senior unsecured ratings at 'BB+' respectively and Short-term IDR at 'B'. The Outlook on the Long-term IDR is Negative. "Despite the remedial actions taken by management with its rights issue, its cut to the 2009 final dividend and further cost reductions, Fitch remains concerned about the continuing deterioration in Ladbrokes's trading performance and the risk of a potentially compressed post-dividend free cash flow in the longer term," said Giulio Lombardi, Senior Director in Fitch's European Retail, Leisure and Consumer Products Group. The deeply discounted, fully underwritten GBP275 million equity issue is expected to reduce pro-forma LTM end-September 2009 net lease-adjusted leverage by approximately 1x to under 4x, a level that remains compatible with the current 'BB+' ratings. Fitch notes, however, that without the rights issue, this measure would have risen above 4.5x and led to a downgrade. FY10 free cash flow will benefit from an expected cash saving of approximately GBP50 million on FY09 dividends, proceeds from the potential sale of its loss-making Italian operations, and cost- cutting measures. However, Fitch cautions that in the absence of a strong recovery of trading performance, future FCF generation will be eroded by a resumption of normal dividend payments. After a difficult H109 in which operating profit fell 26%, trading in Q309 worsened further, with a 58% decline over a year ago, though in large part due, according to the company, to an unusually low profit margin from football betting in the period. From Q409, given the low comparison base of last year, UK betting spending could improve as the economy bottoms out. However, the European betting industry continues to face stiff competition among leading players. Equity issuance proceeds are expected to pay down drawings on Ladbrokes's bank facilities. Although the majority of these facilities only come up for renewal between 2012 and 2013, the rights issue and a new financial policy targeting Net Debt / EBITDA below 3.0x are intended to put the company in a more favourable position, particularly insofar as industry conditions remain challenging, in the wake of potentially more stringent lending requirements. These could include the possible tightening of Ladbrokes's net debt / EBITDA covenant of currently 4.25x to the 3.5x level of another industry peer. LINK LENDING: Placed Into Administration; PwC on Board ------------------------------------------------------ Joe McGrath at FT Adviser reports that Link Lending has gone into administration. FT Adviser, citing Money Management, says PricewaterhouseCoopers were appointed as administrators on Oct. 8 and that staff is in the process of informing brokers of arrangements for pipeline business. According to FT Adviser, sister company Link Loans was continuing to trade normally Monday with a separate funding line, believed to be supplied from American financial group AIG. Link Lending had offered bridging loans to residential properties of up to 60% loan-to-value (LTV) at rates between 1.25% and 1.5% a month, FT Adviser discloses. NEWGATE FUNDING: Moody's Cuts Ratings on Two Classes of Notes to C ------------------------------------------------------------------ Moody's Investors Service has downgraded the ratings of 15 classes of notes and has confirmed the ratings of 4 classes of notes issued by Newgate Funding Plc. The 19 affected tranches, listed below, had been placed on review for possible downgrade on 26 June 2009 due to worse-than-expected collateral performance. The rating actions conclude the review and take into account the increased loss expectations for the three mortgage portfolios backing Newgate Funding Series 2006-1, Newgate Funding Series 2006-2 and Newgate Funding Series 2006-3. Newgate Funding Series 2006-1closed in March 2006 and the current pool factor is approximately 32%. The assets supporting the notes are "near prime", sub-prime and non-conforming mortgage loans secured by residential properties located in England, Wales, Scotland and Northern Ireland, with approximately 56% of the outstanding portfolio represented by interest-only loans. The original weighted average LTV at closing was approximately 79% while the current weighted average indexed LTV has increased to approximately 84%. As a result of the house price depreciation after closing, approximately 20% of the outstanding portfolio is currently characterized by an indexed LTV higher than 100%. The cumulative losses realized since closing in Newgate Funding Series 2006-1 amount to 1.30% of the original portfolio balance, with an average loss severity of 18%. The reserve fund, fully funded at closing, was first drawn in June 2008 and is currently 45% of the required reserve fund amount. Newgate Funding Series 2006-2 closed in June 2006 and the current pool factor is approximately 49%. The assets supporting the notes are "near prime", sub-prime and non-conforming mortgage loans secured by residential properties located in England, Wales, Scotland and Northern Ireland, with approximately 55% of the outstanding portfolio represented by interest-only loans. The original weighted average LTV at closing was approximately equal to 80% while the current weighted average indexed LTV has increased to approximately 87%. As a result of the house price depreciation after closing, approximately 26% of the outstanding portfolio is currently characterized by an indexed LTV higher than 100%. The cumulative losses realized since closing in Newgate Funding Series 2006-2 amount to 1.31% of the original portfolio balance, with an average loss severity of 19.5%. The reserve fund, fully funded at closing, was first drawn in July 2008 and is currently 7.7% of the required reserve fund amount. Newgate Funding Series 2006-3 closed in November 2006 and the current pool factor is approximately 63%. The assets supporting the notes are "near prime", sub-prime and non-conforming mortgage loans secured by residential properties located in England, Wales, Scotland and Northern Ireland, with approximately 66% of the outstanding portfolio represented by interest-only loans. The original weighted average LTV at closing was approximately equal to 80% while the current weighted average indexed LTV has increased to approximately 94%. As a result of the house price depreciation after closing, approximately 44% of the outstanding portfolio is currently characterized by an indexed LTV higher than 100%. The cumulative losses realized since closing in Newgate Funding Series 2006-3 amount to 1.31% of the original portfolio balance, with an average loss severity of 23%. The reserve fund, fully funded at closing, was first drawn in August 2008 and is currently 41% of the required reserve fund amount. According to the latest investor reports, 90+ days delinquencies (including outstanding repossessions) have increased in the last quarter to 32.9% of the outstanding balance of the portfolio in Newgate Funding Series 2006-1, 31.2% in Newgate Funding Series 2006-2 and 32.9% in Newgate Funding Series 2007-3. These levels of 90+ arrears are partially overstated by the common practice of computing the number of months in arrears by dividing the arrears amount by the last monthly installment. In the last quarter, the loans in arrears which have not made any payment have been approximately equal to 18.0% of the current portfolio balance in Newgate Funding Series 2006-1, 17.8% in Newgate Funding Series 2006-2 and 18.1% in Newgate Funding Series 2006-3. Over the same period of time, the borrowers in arrears who have paid at least their contractual monthly installment amount to 19.7% of the current portfolio balance in Newgate Funding Series 2006-1, 19.2% in Newgate Funding Series 2006-2 and 20.7% in Newgate Funding Series 2006-3. The ability of these delinquent borrowers to partially cure their arrears may be also linked to the current benign interest rate environment for the floating rate loans, which currently represent approximately 100% for Newgate Funding Series 2006-1 and 2006-2 and 81.7% of the current portfolio balance for Newgate Funding Series 2006-3. Moody's has taken into account that such payment ability could be put at risk in case the interest rate environment became less favorable in the future. The Affected Transactions are exposed to unhedged basis risk between the interest received on the mortgage loans, ultimately linked to the BBR, and the 3-Month-GBP-Libor due on the notes. Additionally, in Newgate Funding Series 2006-3 the fixed-floating swap provides only a partial hedging as the 3-Month-GBP-Libor payable by the swap counterparty resets monthly whereas the 3- Month-GBP-Libor payable on the Notes resets quarterly. These unhedged basis risks had been previously sized by Moody's and have not been the driver of the rating actions. Moody's has assessed updated loan-by-loan information of the outstanding portfolio to determine the increase in credit support needed and the volatility of future losses. As a consequence, Moody's has revised its Milan Aaa CE for the Affected Transactions to 28% for Newgate Funding Series 2006-1 and 2006-2 (previously 26.4% and 23% respectively) and to 30% for Newgate Funding Series 2006-3 (previously 27%). In each of the Affected Transactions the Class A notes share the same PDL and their current available credit enhancement (excluding excess spread) equals approximately 41.8% in Newgate Funding Series 2006-1, 32.5% in Newgate Funding Series 2006-2 and 25.7% in Newgate Funding Series 2007-3. In Newgate 2006-3 the principal redemption within the Class A notes is fully sequential, hence these classes are expected to have significantly different average lives. In its cash flow analysis Moody's has taken into account the faster repayment of the Class A2 and Class A3 notes for Newgate Funding Series 2006-3 and this has led to the confirmation of the rating for Class A2. Considering the current amount of realized losses, and completing a roll-rate and severity analysis for the non-defaulted portion of the portfolio, Moody's has also increased its total loss expectations to 4.0%, 5.75% and 7.0% of the original portfolio balance for Newgate Funding Series 2006-1, 2006-2 and 2007-2 respectively (vs. 2.25%, 2.75% and 3.50% previously assumed). The loss expectation and the Milan Aaa CE are the two key parameters used by Moody's to calibrate the loss distribution curve, which is one of the inputs into Moody's RMBS cash-flow model. Moody's has also factored into its analysis the negative sector outlook for UK non-conforming RMBS. The sector outlook reflects these expectations of key macro-economic indicators: GDP to contract by 4.1% in 2009, followed by growth of 0.9% in 2010, unemployment to increase to 9.6% by 2010 from 7.8%, house prices to decrease by over 30% from their peak in 2007 to a trough in 2010 and further increases in personal insolvencies. For more detailed information please refer to Moody's Economy.Com. The classes of notes affected by the rating actions are: Newgate Funding Series 2006-1: -- Class A4, confirmed at Aaa; previously on 26 June 2009 Aaa and placed under review for possible downgrade; -- Class Ma confirmed at Aa1; previously on 26 June 2009 Aa1 and placed under review for possible downgrade; -- Class Mb confirmed at Aa1; previously on 26 June 2009 Aa1 and placed under review for possible downgrade; -- Class Ba confirmed at Aa3; previously on 26 June 2009 Aa3 and placed under review for possible downgrade; -- Class Bb confirmed at Aa3; previously on 26 June 2009 Aa3 and placed under review for possible downgrade; -- Class Ca downgraded to Baa3; previously on 26 June 2009 A3 and placed under review for possible downgrade; -- Class Cb downgraded to Baa3; previously on 26 June 2009 A3 and placed under review for possible downgrade; -- Class D downgraded to Caa1; previously on 26 June 2009 Ba3 and placed under review for possible downgrade; and -- Class E downgraded to Ca; previously on 26 June 2009 B3 and placed under review for possible downgrade. Newgate Funding Series 2006-2: -- Class A3a, downgraded to Aa1; previously on 26 June 2009 Aaa and placed under review for possible downgrade; -- Class A3b, downgraded to Aa1; previously on 26 June 2009 Aaa and placed under review for possible downgrade; -- Class M downgraded to Aa2; previously on 26 June 2009 Aa1 and placed under review for possible downgrade; -- Class Ba downgraded to A3; previously on 26 June 2009 Aa3 and placed under review for possible downgrade; -- Class Bb downgraded to A3; previously on 26 June 2009 Aa3 and placed under review for possible downgrade; -- Class Ca downgraded to B1; previously on 26 June 2009 Baa2 and placed under review for possible downgrade; -- Class Cb downgraded to B1; previously on 26 June 2009 Baa2 and placed under review for possible downgrade; -- Class Da downgraded to Ca; previously on 26 June 2009 B3 and placed under review for possible downgrade; -- Class Db downgraded to Ca; previously on 26 June 2009 B3 and placed under review for possible downgrade; and -- Class E downgraded to C; previously on 26 June 2009 Caa2 and placed under review for possible downgrade; Newgate Funding Series 2006-3: -- Class A2, confirmed at Aaa; previously on 26 June 2009 Aaa and placed under review for possible downgrade; -- Class A3a, downgraded to Aa1; previously on 26 June 2009 Aaa and placed under review for possible downgrade; -- Class A3b, downgraded to Aa1; previously on 26 June 2009 Aaa and placed under review for possible downgrade; -- Class Mb downgraded to Aa3; previously on 26 June 2009 Aa2 and placed under review for possible downgrade; -- Class Ba downgraded to Baa2; previously on 26 June 2009 A2 and placed under review for possible downgrade; -- Class Bb downgraded to Baa2; previously on 26 June 2009 A2 and placed under review for possible downgrade; -- Class Cb downgraded to B3; previously on 26 June 2009 Ba1 and placed under review for possible downgrade; -- Class Da downgraded to Ca; previously on 26 June 2009 B3 and placed under review for possible downgrade; -- Class Db downgraded to Ca; previously on 26 June 2009 B3 and placed under review for possible downgrade; and -- Class E downgraded to C; previously on 26 June 2009 Caa3 and placed under review for possible downgrade. Moody's ratings address the expected loss posed to investors by the legal final maturity of the notes. Moody's ratings address only the credit risks associated with the transactions. Other non-credit risks have not been addressed, but may have a significant effect on yield to investors. TOOTSIES RESTAURANTS: Placed Into Administration ------------------------------------------------ The Board of Clapham House Group PLC has withdrawn support and funding to its subsidiary Tootsies/Dexters business. As a consequence, the subsidiary companies Tootsies Restaurants Limited, Urban Dining Limited, Tootsies Holdings Limited and TD Scotland Limited have been placed into administration. BDO LLP were appointed as administrators of Tootsies on October 12, 2009. All other parts of The Clapham House Group PLC, namely the Gourmet Burger Kitchen and The Real Greek businesses, are unaffected by this action and will continue to trade as normal. Clapham House has provided significant financial support to Tootsies since its acquisition in May 2006. However, given the current economic outlook and the prolonged downturn in trading and profitability at the Tootsies business, the Clapham House Board believes that there is little prospect of the Tootsies business as a whole generating a profit in the near future. As a result, and after extensive review, the solvent restructuring of the Tootsies business is not considered to be a viable solution. The Board of Clapham House has therefore acted now to protect the Company's profitable Gourmet Burger Kitchen and The Real Greek businesses as well as its shareholders and the majority of its staff. The Administrators have informed Clapham House that subsequent to their appointment this morning a sale agreement was entered into to sell 11 of the 21 restaurant units currently operated by Tootsies to Giraffe Concepts for a consideration of GBP2.5 million (before costs). The sale will preserve approximately 25 full time and over 250 part time jobs. The Administrators are continuing to explore opportunities to dispose of the remaining 10 Tootsies/Dexters restaurant units in order to maximise returns to creditors of Tootsies. Prior to these actions, the Clapham House Board consulted with the Company's bankers, who confirmed that Clapham House's bank facilities are unaffected by these changes and remain available until June 2012. Any net proceeds received by the bank from the Administrators will be applied to reduce the Company's indebtedness under these banking facilities. David Page, Chairman of The Clapham House Group PLC, said: "We have taken the steps described in this announcement with great regret, having spent considerable time researching alternative strategic options for Tootsies. We believe that this is the best course of action to protect shareholder value whilst minimising job losses. Looking to the future the management team will focus on building the excellent reputation and strength of its two core brands, Gourmet Burger Kitchen and The Real Greek." URSUS 2: Moody's Cuts Rating on GBP27.2 Mln Class F Notes to 'Ba2' ------------------------------------------------------------------ Moody's Investors Service has downgraded these classes of Notes issued by Ursus 2 (Octane) plc (amount reflecting initial outstandings): -- GBP49M Class B Floating Rate Notes, Downgraded to Aa3; previously on Apr 8, 2009 Aa1 Placed Under Review for Possible Downgrade -- GBP49M Class C Floating Rate Notes, Downgraded to A3; previously on Apr 8, 2009 Aa2 Placed Under Review for Possible Downgrade -- GBP27.2M Class D Floating Rate Notes, Downgraded to Baa3; previously on Apr 8, 2009 Aa3 Placed Under Review for Possible Downgrade -- GBP27.2M Class E Floating Rate Notes, Downgraded to Ba1; previously on Apr 8, 2009 A1 Placed Under Review for Possible Downgrade -- GBP27.2M Class F Floating Rate Notes, Downgraded to Ba2; previously on Apr 8, 2009 A2 Placed Under Review for Possible Downgrade At the same time, Moody's affirmed the Aaa ratings of the Class A, Class X1, and Class X2 Notes. The rating action concludes the review for possible downgrade that was initiated for the Class B, C, D, E, and Class F Notes on 8 April 2009. The rating action takes Moody's updated central scenarios into account, as described in Moody's Special Report "Moody's Updates on Its Surveillance Approach for EMEA CMBS." 1) Transaction Overview Ursus 2 (Octane) plc closed in July 2006 and represents a true- sale securitisation of a single commercial mortgage loan secured by 180 petrol filling stations located throughout the UK. All properties are let to the single tenant, Shell U.K. Limited, under fully repairing and insuring leases for a term that expires on 29 November 2019, subject to a mutual break option in November 2017. Shell is the major operating subsidiary in the United Kingdom of Royal Dutch Shell plc whose long-term senior unsecured debt is rated Aa1 by Moody's. The sponsor of the borrower is the Englander Group which financed the acquisition of the portfolio through the securitized loan in the transaction. As of closing, the Loan amounted to GBP351.6 million. It amortizes in quarterly installments based on a fixed repayment schedule and as of August 2009, the outstanding balance of the Loan was GBP339.1 million. As at closing, the Loan was anticipated to be repaid in February 2013 ("Anticipated Repayment Date") by when the balance will have reduced to GBP 323.9 million. In case the borrower cannot refinance the Loan by the Anticipated Repayment Date, it can be extended to November 2017 at the request of the borrower. From February 2013 onwards, a 2% subordinated step-up interest will accrue and be payable at the latest at the final maturity date of the Loan in November 2017. At closing, a mezzanine loan was advanced to the borrower which is secured by second ranking charges over the properties and is subject to an intercreditor agreement. The mezzanine loan which is outside of the securitization amounted to GBP17.0 million at closing and has amortized down to GBP9.7 million as of August 2009. The legal final maturity of the Notes is in November 2019, two years after the final maturity of the Loan. 2) Rating Rationale The rating action has been prompted by (i) the observed value decrease of the property portfolio over the last 2 years and an expectation of further value declines over the next year to a Moody's trough value of GBP350 million; and (ii) an increased refinancing risk due to the higher anticipated loan-to-value ratio of the Loan at maturity compared with Moody's expectation at closing. In Moody's view, property values in the UK will only gradually increase from 2011 onwards and the lending activity will remain limited for the foreseeable future with a preference for loans secured by standard property types and with moderate LTV levels. Therefore, in Moody's opinion, there is a high likelihood of the Loan not being repaid by the Anticipated Repayment Date, rather, being extended potentially until 2017 in accordance with the Loan agreement. Moody's highlights that the leases with Shell are subject to a break option in 2017 and they expire in 2019. Given this lease expiry profile of the portfolio, the prospect of a successful refinancing of the Loan in 2017 depends more on Shell renewing its leases than it was expected at closing by Moody's, translating into increased volatility and, therefore, a higher default risk assessment at maturity of the Loan. Given the higher refinancing risk, the default risk of the Loan assessed by Moody's has increased compared to closing, but it is still relatively low, benefiting during the term of the Loan from the credit strength of the Tenant. Upon a loan default, Moody's expects a low amount of losses on the securitized Loan. The Class A Noteholders are protected against those losses by the subordination provided by more junior classes, and the still material property value cushion available. Based on Moody's trough value assessment for the portfolio, the note-to-value level is expected to be around 46% for the Class A Notes. Further, as the transaction incorporates a fully sequential priority of interest and principal payments, Moody's expects the credit enhancement available to the Class A Notes to increase over time through scheduled Loan repayments. These factors combined have resulted in the affirmation of the rating of the Class A Notes. For the mezzanine and junior Notes, however, the experienced property value decline has already resulted in an erosion of the property value cushion available and Moody's expects this cushion to erode even further. The Class B, Class C, Class D, Class E and Class F Notes are subordinated in the transaction's capital structure. Due to this additional leverage, the higher portfolio risk assessment has a relatively bigger impact on the expected loss of the more junior Notes than on the expected loss of the senior Notes. Based on Moody's trough value for the portfolio, the estimated note-to-value level is approximately 60% for the Class B Notes, 74% for the Class C Notes, 81% for the Class D Notes, 89% for the Class E Notes and 97% for the Class F Notes. Moody's affirmed the ratings of the Classes X1 and X2 Notes. The Class X Notes are entitled to receive prepayment fees in connection with the underlying Loan and the difference between (i) interest payable on the Loan and (ii) interest payable on the Notes and certain costs. The liquidity facility can be used to cover potential interest shortfalls on the Class X Notes. In relation to principal, the Class X Notes benefit from equivalent amounts deposited on the Class X Account. Given these characteristics, the ratings of the Class X Notes are not affected by the increased credit risk of the Loan. 3) Performance history Being a single-tenanted transaction with a high credit quality tenant, the performance of the transaction has been stable to date, with no performance issues being reported. In comparison to closing, the rental income is scheduled to increase which results in increasing coverage ratios over time. The rent payable under the leases is subject to five year reviews and will be adjusted upwards twice during the life of the transaction by a factor of 1.025 raised to the fifth power. At closing, the net rental income amounted to GBP22.9 million; in November 2009 the net rental income is scheduled to increase to GBP25.9 million. The underwriter's DSCR was 1.01x for the Loan at closing while the 12- month forward-looking DSCR as of August 2009 is 1.11x compared with the covenant of 1.00x. At closing, based on the underwriter's market value of GBP463.0 million, the Loan had a loan-to-value of 76%. In September 2008, the servicer ordered a new valuation for the portfolio which showed a U/W MV of GBP410 million. As a result of the new valuation, the LTV increased to 83.5% which has since decreased to 82.7% due to scheduled amortization compared with the Loan covenant of 85.0%. Moody's understands that the servicer has ordered a second re-valuation of the portfolio which will be the basis for the next covenant testing in November 2009. In Moody's view, in line with its value assessment for the portfolio explained below and absent any Loan prepayments, there is a high likelihood of the LTV covenant being breached as of the next interest payment date in November 2009. Moody's also notes that as part of the lease agreement, the Tenant has the right to assign up to 10% by rental value of the leases (without guarantee) to a third party tenant that must hold a Moody's long-term unsecured, unguaranteed rating of at least A2. Moreover, without any limit or consent from the property owner, the Tenant is allowed to assign the leases to seven other major suppliers of fuel/petrol, entities rated Aa2 or higher and/or any group company of the Tenant. The Tenant is also allowed to 1) terminate leases related to properties that become obsolete (subject to the payment of a "Compensation Sum" by the Tenant) or 2) substitute other properties of similar nature and value. Moody's is aware that to date, the Tenant has only substituted one property within the flexibilities explained above. 4) Moody's Analysis Property values: Property values across the UK have significantly fallen since mid 2007. Moody's estimates that the trough value of the property portfolio is GBP 350 million. The difference between Moody's trough value assessment and the U/W MV of GBP410 million as of September 2008 can be explained by the significant yield widening seen for properties in the UK over the past year, also considering the specialist nature of the properties in the portfolio. Based on Moody's trough value assessment, the estimated LTV ratio of the Loan is 97%. Moody's anticipates only a slow recovery of UK property values from 2011 onwards and this recovery is not expected to be material until the Anticipated Repayment Date of the Loan in February 2013. In order to account for the single tenant exposure in this transaction, Moody's uses the vacant possession value of the property portfolio as the relevant recovery value upon a payment default during the Loan term. Moody's VPV of the portfolio is GBP240 million, representing 60% of the sustainable value for the portfolio. For its sustainable value assessment of GBP400 million, Moody's gave benefit to (i) the value of having Shell, a strong covenant with long-term leases in-place and (ii) the attractiveness of the property portfolio in its existing use, not only to Shell but also to other suppliers of fuel/petrol. Refinancing Risk: In Moody's view, the refinancing risk for the Loan in November 2017 is highly dependent on the renewal of the Shell leases which are due to expire in November 2019 (subject to a mutual break option in November 2017). Moody's considers that the petrol filling stations securing the transaction are of overall good quality and attractive to Shell from an operational standpoint. To assess the default probability of the Loan at maturity, Moody's derived a value for the portfolio based on different lease renewal assumptions that range from 50% to 80% for different properties in the portfolio which resulted in a refinancing value that is slightly lower than Moody's sustainable value. Based on this approach, and taking into account (i) potential prepayments of the Loan in case of a LTV covenant breach and (ii) the subordinated 2% step-up interest that will accrue from the Anticipated Repayment Date onwards, Moody's estimates that the refinancing LTV of the Loan will be around 86% in 2017. While the risk of the Loan defaulting at maturity is still low, it is considerably higher than expected by Moody's at closing of the transaction. 5) Rating Sensitivity The credit risk of the Notes in the near term is closely linked to the quality of the Tenant, and the credit quality of the Tenant's parent (Royal Dutch Shell plc), although, Moody's would not expect a change of the ratings of the Notes, all else being equal, if a rating change for the parent company was limited to two notches. As reflected in the rating action, the ratings of the Notes are sensitive to Moody's refinancing risk assessment for the securitized Loan and its loss given default expectations, which are in turn dependent on the attractiveness of the petrol filling stations to Shell or an alternative operator. * UK: PwC Survey Finds Survival of Companies Getting Easier ----------------------------------------------------------- Specialists who are charged with saving the U.K.'s most distressed companies are finally beginning to see an improved outlook on the state of the U.K. economy, but are still facing some tough challenges as they help distressed businesses through the recession. This is according to the most recent survey by PricewaterhouseCoopers LLP of its Turnaround Director (TD) Panel which showed over 67% of respondents believe over half of current turnarounds will be successful and 85% of TDs believing their key trading indicators have levelled out or are starting to improve. However, these positive responses are countered by lingering concerns over companies' readiness to accept they need help with 56% of respondents still finding this to be a main barrier to their help being sought and continuing frustrations at the ease with which they can raise additional finances to fund their turnaround efforts with 86% of TDs finding it the same or harder to raise new funds. The findings reflect the views of more than 160 members of the PwC Turnaround Director. The panel consists of senior executives, many with specialist expertise in corporate rescue, who can be introduced to a troubled business and take on an executive role in its turnaround. Richard Boys-Stones, partner, Business Recovery Services at PricewaterhouseCoopers LLP, said: "Turnaround Directors (TDs) have been at the coal-face of UK Businesses attempts to survive through the recession and to that end it is really encouraging to see that they are beginning to see some positive signs in their work with distressed companies. "However, while it seems things are certainly getting no worse, there are clearly still real challenges for any company attempting to secure additional funding as the ease of raising funds is no better and some instances harder than it was in May of this year. Perhaps most frustratingly, TDs are still finding that companies are not prepared to accept they need help and are not calling on their services quick enough." Opinions of the sometimes controversial 'pre-pack' administration resulted in a spectrum of views from TDs. Many TDs believe this process to be a useful and appropriate tool in the right situation, but the fact that some respondents found the process unacceptable and even morally questionable suggests there is still work to be done in making sure the appropriate safeguards and levels of transparency are in place. Similarly, perceptions of what constitutes a successful turnaround were wide ranging. Most respondents cited survival of the business with a return to profitability, a clear vision and strategy and operation for at least two years as being the hallmarks of success. However, there was a major polarisation as to whether success requires the survival of the company or business typically with the use of a 'pre-pack'. About PricewaterhouseCoopers PricewaterhouseCoopers provides industry-focused assurance, tax and advisory services. ********* 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. Valerie C. Udtuhan, Marites O. Claro, Rousel Elaine C. Tumanda, Joy A. Agravante and Peter A. Chapman, Editors. Copyright 2009. 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 * * *