/raid1/www/Hosts/bankrupt/TCREUR_Public/100312.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
Friday, March 12, 2010, Vol. 11, No. 050
Headlines
B O S N I A & H E R Z E G O V I N A
MLJEKARA AD: Potential Buyers Have Until April 2 to Submit Bids
F R A N C E
PERNOD RICARD: Mulls Bond Issue for Absolut Refinancing
TEREOS UNION: S&P Retains 'BB' Rating with Negative Outlook
G E R M A N Y
ARCANDOR AG: Karstadt Posts Profit in 6-Mos. Ended October 2009
I R E L A N D
AER LINGUS: To Cut Cabin Crew Workforce by Around 230
OMEGA CAPITAL: S&P Withdraws 'B+' Rating on Series 55 Notes
OMEGA CAPITAL: S&P Withdraws 'CCC-' Rating on EUR300 Mil. Notes
I T A L Y
BANCO POPOLARE: S&P Lowers Rating on Tier 1 Sub. Notes to 'BB'
FIAT SPA: CGIL to Strike for Four Hours Today Over Job Cuts
IT HOLDING: To Cut 450 Jobs; Secures Approval for Brand Auctions
L U X E M B O U R G
INTERCONTINENTAL CDO: S&P Cuts Preferred Securities Rating to CC
ORCO PROPERTY: Secures Three-Month Extension of Safeguard Plan
M A C E D O N I A
DELTA: On the Verge of Liquidation
VIP BROKER: Seeks Suspension of Work Permit on Small Turnover
N E T H E R L A N D S
AMSTEL CORPORATE: S&P Affirms Rating on Class E Notes at 'BB'
CEVA GROUP: Moody's Assigns 'Caa1' Rating on US$625 Mil. Notes
CEVA GROUP: S&P Assigns 'CCC' Rating on Proposed Junior Notes
R O M A N I A
* ROMANIA: Firms File for Insolvency to Avail Law's Benefits
R U S S I A
ALLIANCE OIL: Fitch Assigns 'B' Final Senior Unsecured Rating
S W E D E N
FORD MOTOR: Geely May Have to Spend SEK10 Bil. to Revive Volvo
U N I T E D K I N G D O M
BRITISH AIRWAYS: Union Talks Over Pay Cuts Collapse
BRITISH AIRWAYS: Offers Concessions to Win Iberia-AA Tie-Up OK
CABLE & WIRELESS: UK Business to Focus on Asian Opportunities
CRU INVESTMENT: High Court Winds Up Business
EMI GROUP: EMI Music Chief Quits Post; Charles Allen Takes Over
IMPERIAL PROPERTY: In Administration; 30 Jobs Affected
MARC CDO: S&P Lowers Ratings on Six Classes of Notes to 'CC'
NORTHERN ROCK: Bad Bank Set to Return to Profit This Year
PERSEUS PLC: Fitch Downgrades Rating on Class D Notes to 'B'
PORTSMOUTH FOOTBALL: Axes 85 Jobs, Administrator Says
REGUS PLC: Demands Rent Cuts, Concessions From Landlords
ROYAL BANK: Seeks Securities License in China, FT Says
SHERWOOD CASTLE: Moody's Cuts Ratings on 2006-1 Notes to 'B1'
* UK: Automotive Sector Insolvencies Down 44.15% in January
X X X X X X X X
* Bundesbank Head Calls for Reform of Future Banking Regulations
* BOOK REVIEW: Instincts of the Herd in Peace and War
*********
=======================================
B O S N I A & H E R Z E G O V I N A
=======================================
MLJEKARA AD: Potential Buyers Have Until April 2 to Submit Bids
---------------------------------------------------------------
Televizija Atlas reports that the bankruptcy manager of Mljekara
AD set an April 2 deadline for interested parties to submit bids
for the company's assets.
According to the report, assets offered for sale include 6,000 sqm
of land, business buildings, production and other equipment, as
well as 34 vehicles.
The starting price was lowered to EUR5.9 million, the report
notes. In the first invitation for sale, from the beginning of
February, the assets of Mljekara were offered at the starting
price of EUR7.6 million, the report discloses.
Mljekara AD Banja Luka is a dairy company based in Banja Luka,
Bosnia's Serb Republic. It processes milk and produces dairy
products and substitutes as well as long-life products.
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F R A N C E
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PERNOD RICARD: Mulls Bond Issue for Absolut Refinancing
-------------------------------------------------------
Sonja Cheung and Caroline Hyde at Bloomberg News report that
Pernod Ricard SA is planning to sell six-year bonds to help
refinance loans used to buy the Absolut vodka brand in March 2008.
According to data compiled by Bloomberg, Pernod has EUR1.7 billion
(US$2.3 billion) of loans due next year, followed by a EUR6.1-
billion facility that must be repaid by 2013. Those deals helped
finance the acquisition of Vin & Sprit AB, the maker of Absolut,
from Sweden's government, Bloomberg states.
Citing people with knowledge of the deal, Bloomberg says the notes
may be priced to yield 225 basis points to 230 basis points more
than the mid-swap rate.
Pernod will be the first non-investment grade, or junk, issuer
since concern Greece would be unable to pay its debt roiled credit
markets, Bloomberg notes.
Bloomberg recalls Pernod was downgraded by one step to Ba1, or one
level below investment grade, by Moody's Investors Service in July
2008. It has an equivalent BB+ grading from Standard & Poor's,
Bloomberg discloses. Junk bonds are those rated below Baa3 by
Moody's and BBB- by S&P.
As reported by the Troubled Company Reporter-Europe on Feb. 26,
2010, Moody's changed the outlook on the Ba1 corporate family
rating and senior unsecured rating of Pernod Ricard SA to positive
from stable.
"The outlook change has been prompted by the company's efforts to
improve its financial risk profile and accelerate the reduction in
indebtedness resulting from the acquisition of Vin & Sprit in July
2008 with a view to achieving a ratio of Net Debt to EBITDA
(before Moody's adjustments) close to its self imposed target of 4
times by fiscal year ending June 2011," said Yasmina Serghini-
Douvin, a Moody's Assistant Vice President -- Analyst. "This
rating action also takes into account management's successful
execution of its strategy and integration of the purchased assets,
despite the weaker demand for premium alcoholic beverages in all
key spirits markets."
About Pernod Ricard
Pernod Ricard -- http://www.pernod-ricard.com/-- is a Paris,
France-based producer and distributor of spirits and wines. It
operates as holding company, with the structure divided between
brand owner subsidiaries, such as The Absolut Company, Havana Club
International and Chivas Brothers, which produce and develop
marketing strategies for the brands, and regional distribution
subsidiaries, such as Pernod Ricard Europe, Pernod Ricard Americas
and Pernod Ricard Asia, which implement marketing strategies and
distribute local brands. The Company is active in eight principal
beverage sectors: whiskies, aniseed spirits, liqueurs, cognacs and
brandies, white spirits and rums, bitters, champagnes and wines.
Pernod Ricard SA's flagship brands include Ricard, Havana Club,
Ballantine's, Malibu, Martell, The Glenlivet, Chivas Regal,
Jameson and Absolut Vodka, among others. It operates in Europe,
both Americas and the Asia-Pacific region.
TEREOS UNION: S&P Retains 'BB' Rating with Negative Outlook
-----------------------------------------------------------
Standard & Poor's Ratings Services said that its rating and
outlook on France-based sugar and sugar derivatives producer
Tereos Union de Cooperatives Agricoles a Capital Variable
(BB/Negative/--) remain unchanged following the company's
announcement about plans to simplify its financial structure and
decrease its indebtedness.
The rating on Tereos already factors in S&P's view that the
company's current positive business trends should contribute to a
further improvement in its financial metrics toward a level of
adjusted debt to EBITDA of about 3.5x by the end of fiscal 2010
(ending Sept. 30) from about 4.0x at the end of fiscal 2009. S&P
will monitor the company's plans regarding its financial structure
as they unfold.
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G E R M A N Y
=============
ARCANDOR AG: Karstadt Posts Profit in 6-Mos. Ended October 2009
---------------------------------------------------------------
Reuters reports that the head of Arcandor AG's work council,
Hellmut Patzelt, told Germany's Focus Online in an interview that
Arcandor's department store chain Karstadt posted a profit for the
six months since October.
Karstadt is in the middle of a selling process and Patzelt says he
hopes to find a buyer by June or July, Reuters notes.
Restructuring
As reported by the Troubled Company Reporter-Europe on Feb. 26,
2010, The Financial Times said that creditors to a portfolio of
stores let by German retailer Karstadt have agreed to a
restructuring. The FT disclosed the restructuring comes after
Karstadt filed for insolvency last June. According to the FT, the
agreement by creditors was needed as part of the insolvency
administrator's plan to restructure the business and avoid the
risk of a liquidation of the property portfolio. The FT said a
majority of holders of EUR1.13 billion (US$1.5 billion) in CMBS,
called Fleet Street Finance Two, issued to finance department
stores occupied by Karstadt, agreed to extend the maturity of
their bonds in the first European restructuring of its kind. In
exchange for extending the maturity of the bonds by three years to
July 2017 and relaxing loan to value covenants on the financing,
bondholders will receive an additional 52 basis points of margin
of interest paid, the FT noted. In addition, any excess cash from
rent or a sale would be used to repay the securitization ahead of
other stakeholders, the FT stated.
About Arcandor AG
Germany-based Arcandor AG (FRA:ARO) -- http://www.arcandor.com/--
formerly KarstadtQuelle AG, is a tourism and retail group. Its
three core business areas are tourism, mail order services and
department store retail. The Company's business areas are covered
by its three operating segments: Thomas Cook, Primondo and
Karstadt. Thomas Cook Group plc is a tour operator with
operations in Europe and North America, set up as a result of a
merger between MyTravel and Thomas Cook AG. It also operates the
e-commerce platform, Thomas Cook, supporting travel services.
Primondo has a portfolio of European universal and specialty mail
order companies, including the core brand Quelle. Karstadt
operates a range of department stores, such as cosmopolitan
stores, including KaDeWe (Kaufhaus des Westens), Karstadt
Oberpollinger and Alsterhaus; Karstadt brand department stores;
Karstadt sports department stores, offering sports goods in a
variety of retail outlets, and a portal, karstadt.de that offers
online shopping, among others.
As reported by the Troubled Company Reporter-Europe, a local court
in Essen formally opened insolvency proceedings for Arcandor on
September 1, 2009. The proceedings started for the Arcandor
holding company and for 14 units, including the Karstadt
department-store chain and Primondo mail-order division.
Arcandor filed for bankruptcy protection after the German
government turned down its request for loan guarantees. On
June 8, 2009, the government rejected two applications for help by
the company, which employs 43,000 people. The retailer sought
loan guarantees of EUR650 million (US$904 million) from Germany's
Economy Fund program. It also sought a further EUR437 million
from a state-owned bank.
=============
I R E L A N D
=============
AER LINGUS: To Cut Cabin Crew Workforce by Around 230
-----------------------------------------------------
Martin Wall at The Irish Times reports that all 1,200 Aer Lingus
cabin crew in the Republic of Ireland are to be sent notices of
termination of their employment next month and offered new
contracts involving lower salary scales and changed work
practices.
According to the Irish Times, following the implementation of new
work practices, which will reduce its requirement for the current
staffing levels, the company will cut its cabin crew workforce by
around 230.
The personnel concerned are to be let go on a compulsory basis,
and offered statutory redundancy terms of two weeks per year of
service, the Irish Times discloses.
The Irish Times says the move follows the rejection by cabin crew
of the terms of a controversial EUR97 million cost-saving deal
which involved over 600 voluntary redundancies, pay cuts and work
practice changes.
The Irish Times recalls on Wednesday night the trade union Impact,
which represents cabin crew, said the measures planned by the
airline were "brutal, targeted and unfair".
The Irish Times recounts the union called on the Labour Relations
Commission to reconvene the parties to find a mutual solution.
However, the company on Wednesday rejected this proposal, and said
it had spent several months at the LRC and had reached an
agreement which was comprehensively turned down, the Irish Times
notes.
The Irish Times relates a spokesman said the company had no
mandate from its board for further talks.
As reported by the Troubled Company Reporter-Europe on March 8,
2010, the Financial Times said Aer Lingus cabin crew on March 5
rejected the carrier's rescue plan, casting renewed doubt over the
company's financial survival. The FT disclosed the plan, which
management says is vital to secure the company's short term
survival, targets savings of EUR97 million including a EUR74
million cut in its wage bill, reducing the cost base by 10%. It
envisages a 15% cut in staff numbers, a 10% pay cut, with pay
increments frozen for 3 years along with reductions in pension
benefits, higher contributions and productivity improvements,
according to the FT.
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.
OMEGA CAPITAL: S&P Withdraws 'B+' Rating on Series 55 Notes
-----------------------------------------------------------
Standard & Poor's Ratings Services withdrew its 'B+' credit rating
on Omega Capital Investments PLC's EUR816.327 million secured
floating-rate series 55 notes.
The rating withdrawal follows the arranger's notification to us
that the issuer recently fully repurchased the notes for
cancellation.
OMEGA CAPITAL: S&P Withdraws 'CCC-' Rating on EUR300 Mil. Notes
---------------------------------------------------------------
Standard & Poor's Ratings Services withdrew its 'CCC-' credit
ratings on Omega Capital Investments PLC's EUR300 million secured
floating-rate series 52 class A and B notes.
These rating withdrawals follow the arranger's notification to us
of the early termination of the notes.
=========
I T A L Y
=========
BANCO POPOLARE: S&P Lowers Rating on Tier 1 Sub. Notes to 'BB'
--------------------------------------------------------------
Standard & Poor's Ratings Services said that it affirmed its 'A-
/A-2' long- and short-term counterparty credit ratings on Italian
bank Banco Popolare Societa Cooperativa SCRL and its core
subsidiaries, Banca Aletti & C. SpA and Credito Bergamasco. At
the same time, S&P removed the long-term ratings on the three
banks from CreditWatch with negative implications, where they were
placed on Dec. 17, 2009. The outlook is negative. S&P also
lowered its ratings on BP's perpetual Tier 1 subordinated notes to
'BB' from 'BB+'.
"The affirmation reflects S&P's view of BP as a highly
systemically important institution to Italy, given its leading
franchise in the northern Italian provinces and its 5.2% market
share in national retail deposits as of December 2008," said
Standard & Poor's credit analyst Mirko Sanna.
S&P considers that government support mitigates its concerns
regarding the future development of the bank's stand-alone credit
profile, given the risks inherited from the consolidation of Banca
Italease since July 2009, the bank's credit exposure to a few weak
corporates, and the weak revenue generation capacity of the former
Banca Popolare di Lodi branch network. Therefore, the long-term
ratings on BP now include one notch of uplift for potential
government support above the bank's stand-alone credit profile.
In S&P's opinion, BP's management is committed to significantly
strengthen the bank's current weak capital position and to address
its large exposure to risky real estate operators and leasing
loans that originated through agents and intermediaries during the
Banca Italease consolidation.
S&P still believe that BP is vulnerable to Italy's deteriorated
economy owing to its large loan exposure to a few weak companies.
In 2009, the bank's credit-related provisions should be below the
average for the domestic banking system, partly attributable in
S&P's view to the large amount of provisions set aside in 2008 on
a few large exposures. S&P currently factors into the rating
credit-related provisions that could reach about 1.25% of loans in
2010, including Italease.
"The negative outlook reflects S&P's opinion of potential rating
pressure if the bank is not able to rebuild its core capital
position and to successfully de-risk Banca Italease in the coming
quarters," said Mr. Sanna. In case of a further weakening in the
group's financial profile, S&P will assess the nature of potential
additional support from the Italian government and whether it
would be sufficient to mitigate a temporary weakening in the
bank's stand-alone credit profile.
Conversely, S&P could revise the outlook to stable if BP's stand-
alone credit profile were to improve materially and support the
ratings. A positive rating action is unlikely at this stage.
FIAT SPA: CGIL to Strike for Four Hours Today Over Job Cuts
-----------------------------------------------------------
Flavia Krause-Jackson at Bloomberg News reports that workers
belonging to CGIL, Italy's biggest labor union, will walk off
their jobs today, March 12, for four hours to protest cuts at
companies such as Fiat SpA, Alcoa Inc. and Antonio Merloni SpA.
According to Bloomberg, the strike called by CGIL, with a
membership of 5.5 million people, and a demonstration in city
centers will cripple traffic and cause delays in public transport
and air travel.
Plans by Fiat to shut down its Termini Imerese plant in Sicily
have fueled concerns about unemployment as the country's economy
contracted in the fourth quarter, Bloomberg notes.
As reported by the Troubled Company Reporter-Europe on Feb. 24,
2010, BBC News said Fiat was temporarily shutting six Italian
factories for a fortnight. BBC disclosed the carmaker said the
move was needed because the end of car scrappage schemes in Europe
had led to "a collapse in orders". About half of Fiat's Italian
car plant workers, some 30,000 people, will be affected, according
to BBC. The plants concerned, which make cars rather than trucks
and farm machinery, are in Rome, Turin, Naples and Sicily, BBC
noted.
About Fiat SpA
Headquartered in Turin, Italy, Fiat SpA (BIT:F) --
http://www.fiatgroup.com/-- is principally engaged in the design,
manufacture and sale of automobiles, trucks, wheel loaders,
excavators, telehandlers, tractors and combine harvesters.
Through its subsidiaries, Fiat operates mainly in five business
areas: Automobiles, including sectors led by Maserati SpA, Ferrari
SpA and Fiat Group Automobiles SpA, which design, produce and sell
cars under the Fiat, Alfa Romeo, Lancia, Fiat Professional,
Abarth, Ferrari and Maserati brands; Agricultural and Construction
Equipment, which is led by Case New Holland Global NV; Trucks and
Commercial Vehicles, which is led by Iveco SpA; Components and
Production Systems, which includes the sectors led by Magneti
Marelli Holding SpA, Teksid SpA, Comau SpA and Fiat Powertrain
Technologies SpA, and Other Businesses, which includes the sectors
led by Fiat Services SpA, a publishing house Editrice La Stampa
SpA and an advertising agency Publikompass SpA. With operations
in over 190 countries, the Group has 203 plants, 118 research
centers, 633 companies and more than 198,000 employees.
* * *
Fiat S.p.A. continues to carry a Ba1 long-term rating from Moody's
Investors Service with negative outlook.
IT HOLDING: To Cut 450 Jobs; Secures Approval for Brand Auctions
----------------------------------------------------------------
Andrew Roberts at Bloomberg News reports that Andrea Ciccoli, one
of IT Holding SpA's three government-appointed administrators,
said that the company, which has about 1,100 workers, agreed with
unions to cut as many as 450 jobs, or 40% of its workforce.
Bloomberg says about 220 employees have already left IT Holding as
part of a state-subsidized layoff plan. Bloomberg notes Mr.
Ciccoli said as many as 230 more could follow in the coming weeks.
Auction
According to Bloomberg, Mr. Ciccoli said in a phone interview IT
Holding also received final approval from Italy's Industry
Ministry to auction Ferre and the Malo cashmere brand. The
administrator, as cited by Bloomberg, said the sale of the Ferre
and Malo brands is "progressing at a brisk pace," and IT Holding
plans to announce the rules and timing for the auctions this wee.
As reported by the Troubled Company Reporter-Europe, IT Holding
was granted bankruptcy protection in February 2009 along with all
of its units after failing to make payments to lenders and
suppliers.
About IT Holding SpA
Based in Milan, Italy, IT Holding SpA (BIT:ITH) --
http://www.itholding.com/-- operates in the luxury goods market.
The company and its subsidiaries design, produce and distribute
apparel, accessories, eyewear and perfumes. Its brand portfolio
embraces: owned brands, Gianfranco Ferre, Malo, Exte, as well as
licensed brands, Versace Jeans Couture, Versace Sport, Just
Cavalli, C'N'C Costume National and Galliano. The company's
production facilities are located in Italy. IT Holding SpA has a
worldwide distribution network, including 39 directly operated
stores, 274 monobrand stores and over 6,000 department and
specialty stores. In order to be present in the most significant
markets, IT Holding SpA has dedicated market companies: ITTIERRE
SpA, ITTIERRE France SA, ITTIERRE Moden GmbH, IT USA HOLDING Inc
and IT Asia Pacific Limited, among others.
===================
L U X E M B O U R G
===================
INTERCONTINENTAL CDO: S&P Cuts Preferred Securities Rating to CC
----------------------------------------------------------------
Standard & Poor's Ratings Services has lowered its credit rating
to 'CC' from 'CCC-' on Intercontinental CDO S.A.'s preferred
securities. This rating action occurred on February 5, but due to
a data entry error was not published until March 10.
In a Feb. 5 transaction update report S&P listed the rating on the
preferred securities, as well as the ratings on Intercontinental
CDO's class A-1a, A-1b, A-2, A-3, B-1, B-2, C, D, I, II, III, IV,
and V notes. However, due to a data entry error affecting the
preferred securities (but not the other notes listed above) the
rating action on the preferred securities was not reflected in
S&P's database and, by consequence, on RatingsDirect and other
information sources.
ORCO PROPERTY: Secures Three-Month Extension of Safeguard Plan
--------------------------------------------------------------
Orco Property Group SA received a three-month extension of its
so-called safeguard plan, which protects the company from its
creditors from court in Paris, Lenka Ponikelska at Bloomberg News
reports, citing the Luxembourg-based developer's spokeswoman Petra
Zdenkova.
Bloomberg relates Ms. Zdenkova said in a phone interview that
the company asked the court to prolong the safeguard period until
June 26 in order to finish its business plan for the company.
"Orco is currently finalizing its Sauvegarde plan, which should be
circulated among creditors at the end of March 2010," Bloomberg
quoted Ms. Zdenkova as saying.
Bloomberg recalls Orco first received a six-month court protection
from the Paris Commercial Court on March 26 to give it time to
overhaul the business and protect it from creditors.
Orco Property Group SA -- http://www.orcogroup.com/-- is a
Luxembourg-based real estate company, specializing in the
development, rental and management of properties in Central and
Eastern Europe. Through its fully consolidated subsidiaries, Orco
Property Group SA operates in several countries, including the
Czech Republic, Slovakia, Germany, Hungary, Poland, Croatia and
Russia. The Company rents and manages real estate and hotels
properties composed of office buildings, apartments with services,
luxury hotels and hotel residences; it also develops real estate
projects as promoter.
=================
M A C E D O N I A
=================
DELTA: On the Verge of Liquidation
----------------------------------
Alfa TV reports that Macedonian brokerage house Delta is only a
step away from deciding on liquidation. According to the report,
the company set a time frame of 30 days for the liquidation.
The company's heads say that they will use the period of 30 days
to make the final decision about leaving the Macedonian capital
market, the report notes.
The number of brokerage houses that have stopped working in the
past two years reached seven companies, the report relates.
VIP BROKER: Seeks Suspension of Work Permit on Small Turnover
-------------------------------------------------------------
Alfa TV reports that Vip Broker and Idea Plus asked the Macedonian
Securities Commission to suspend their work permit due to small
turnover.
According to the report, the number of brokerage houses that have
stopped working in the past two years reached seven companies.
=====================
N E T H E R L A N D S
=====================
AMSTEL CORPORATE: S&P Affirms Rating on Class E Notes at 'BB'
-------------------------------------------------------------
Standard & Poor's Ratings Services affirmed and removed from
CreditWatch negative its credit ratings on Amstel Corporate Loan
Offering 2006 B.V.'s class A, B, C, D, and E credit-linked
floating-rate notes.
S&P has taken these rating actions following its analysis of the
effect that its updated corporate collateralized debt obligation
criteria have on these ratings.
On Sept. 17, S&P placed on CreditWatch negative its ratings on
1,626 European cash flow, hybrid, and synthetic CDO transactions,
in tandem with the publication of its updated criteria.
In its review, S&P considered both the updated criteria and its
assessment of any credit deterioration or improvement the tranches
have experienced since its last review. For classes A, B, C, D,
and E, S&P's assessment indicated there was sufficient credit
enhancement to support the stressed scenario loss at the current
rating levels. Accordingly, S&P affirmed and removed from
CreditWatch negative its ratings on these notes.
Ratings List
Amstel Corporate Loan Offering 2006 B.V.
EUR1.6 Billion Credit-Linked Floating-Rate Notes
Ratings Affirmed and Removed From Creditwatch Negative
Rating
------
Class To From
----- -- ----
A AAA AAA/Watch Neg
B AA AA/Watch Neg
C A A/Watch Neg
D BBB BBB/Watch Neg
E BB BB/Watch Neg
CEVA GROUP: Moody's Assigns 'Caa1' Rating on US$625 Mil. Notes
--------------------------------------------------------------
Moody's Investors Service has assigned a provisional (P) Caa1 /
LGD4 -- 55% rating to the proposed issuance of US$625 million
junior priority senior secured notes due 2018 by CEVA Group plc.
The notes will rank junior to the existing first-lien bank
facility and the first-and-a-half priority notes issued in
September 2009 but senior to the existing second-lien notes (which
are becoming unsecured as a result of the successful consent
solicitation) and to the senior unsecured and subordinated
indebtedness. The proceeds of the issue are intended to finance
the purchase price and related fees with respect to the cash
tender offer and consent solicitation for the 10% second-priority
senior secured notes due 2014 and the 12% second-priority senior
secured notes due 2014. The cash tender offer was launched in
late February and the final amount of the proposed notes will
depend on the amount of second-lien notes tendered. The assigned
rating assumes that there will be no material variations to the
draft legal documentation reviewed by Moody's.
The (P) Caa1 rating on the new notes reflects the relative ranking
within the company's capital structure and the relative size
compared to CEVA's existing debt instruments. The notes will be
senior secured and will be effectively subordinated in right of
payment to all existing and future debt secured by a senior
priority lien (including obligations under the senior secured
facilities and the first-and-a-half priority notes), and be
effectively senior in right of payment to all existing and future
debt secured by a junior priority lien and unsecured senior debt
and other unsecured obligations. The notes will be jointly and
severally guaranteed on a senior basis by the same subsidiaries
that guarantee the senior secured credit facilities. As of FYE
December 2009, this represented 76% of total assets or 58% of
total revenue or 50% of total EBITDA before exceptional items.
Moody's notes that EBITDA coverage is weak, although this was
negatively affected by the group's operating difficulties in the
US. The EBITDA generated by the guarantor's group was
historically above 50%. The guarantees will be senior obligations
of the guarantors and will have the same lien priority as the
notes.
CEVA's Corporate Family Rating and Probability of Default Rating
remain unchanged at Caa1. This reflects Moody's expectation that
CEVA's operating performance and key credit metrics are likely to
remain weak over the short term. The group recently reported
results for FYE December 2009, reporting revenues of almost
EUR5.5 billion, down by 13% from the previous year, and EBITDA of
EUR233 million, before exceptional items, down by 28.5% compared
to the previous year, as the company suffered from significant
demand reduction during 2009, particularly from the automotive
segments. Key credit metrics at FYE December 2009, with financial
leverage, measured as Debt to EBITDA (adjusted for pension and
operating leases) at 8.4x and EBITA interest cover at 0.6x are
seen as unsustainable, hence the negative outlook on the ratings.
A stabilization of the outlook could follow evidence of recovery
in market conditions in the broad logistic segment and sustained
improvements in profitability leading to a gradual recovery in
credit metrics, together with a solid liquidity profile.
In addition to the junior priority senior secured notes due 2018,
CEVA proposes to issue US$77 million of junior priority senior
secured notes due 2018 to Apollo in a private exchange offer for
its ownership of the second-priority senior secured notes due
2014. In addition, Apollo has agreed to extend the maturities on
all of the other debt of CEVA held by it to no earlier than
June 30, 2018, concurrently with and conditioned on the
consummation of the cash tender offer. Moody's does not view this
debt maturity extension as a distressed exchange and recognises
the improvement in the company's debt maturity profile.
Rating assigned:
Issuer: CEVA Group plc
-- New Junior Priority Senior Secured notes rating assigned to
new US$625 million notes at (P) Caa1 (LGD4, 55%)
Moody's issues provisional ratings in advance of the final sale of
securities and these ratings reflect Moody's preliminary credit
opinion regarding the transaction only. Upon a conclusive review
of the final documentation, Moody's will endeavor to assign a
definitive rating to the notes. A definitive rating may differ
from a provisional rating.
The last rating action on CEVA was implemented on September 29,
2009, when Moody's assigned a (P) Caa1 rating to the proposed
first-and-a-half priority notes.
CEVA's ratings were assigned by evaluating factors Moody's
believes are relevant to the credit profile of the issuer, such as
(i) the business risk and competitive position of the company
versus others within its industry; (ii) the capital structure and
financial risk of the company; (iii) the projected performance of
the company over the near to intermediate term; and (iv)
management's track record and tolerance for risk. These
attributes were compared against other issuers both within and
outside of CEVA's core industry and Moody's believes that the
company's ratings are comparable to those of other issuers of
similar credit risk.
CEVA Group plc is the fourth-largest integrated logistic provider
in the world in terms of revenues, which were approximately
EUR5.5 billion at FYE2009. The company operates in over 170
countries worldwide, employing around 46,000 people and managing
in excess of 10 million square meters of warehouse facilities.
CEVA's activities include the former Contract Logistics (CL)
business as acquired from TNT N.V. during 2006 and the Freight
Management (FM) business of EGL, a US-based company acquired in
August 2007.
CEVA GROUP: S&P Assigns 'CCC' Rating on Proposed Junior Notes
-------------------------------------------------------------
Standard & Poor's Ratings Services said that it assigned its 'CCC'
debt rating to the proposed junior priority senior secured notes
to be issued by Netherlands-based CEVA Group PLC (CCC+/Stable/--),
the holding company of Dutch logistics group CEVA Ltd. S&P's
rating assumes an issue of up to EUR500 million of the proposed
notes.
At the same time, S&P assigned a recovery rating of '5' to this
debt, indicating its expectation of modest (10%-30%) recovery for
creditors in the event of a payment default. S&P anticipate that
the new notes will rank senior in lien priority to the existing
second-lien notes, also issued by CEVA, and junior in lien
priority to the group's existing senior secured first-lien
facilities and the US$210 million one-and-a-half lien notes due
2016.
In addition, S&P affirmed the issue rating on the senior secured
first-lien facilities issued by CEVA at 'B-', one notch higher
than the corporate credit rating. The recovery rating on these
facilities is unchanged at '2', indicating S&P's expectation of
substantial recovery (70%-90%) for senior secured lenders in the
event of a payment default. S&P also affirmed the 'CCC' issue
rating on CEVA's one-and-a-half-lien, second-lien, and senior
unsecured notes. The recovery rating of '5' on these debt
instruments is unchanged, indicating S&P's expectation of modest
(10%-30%) recovery for creditors in the event of a payment
default.
Finally, S&P affirmed the issue rating on the company's senior
subordinated notes due 2016 at 'CCC-,' two notches lower than the
corporate credit rating. The recovery rating on these notes is
unchanged at '6' indicating S&P's expectation of negligible (0%-
10%) recovery in the event of a payment default.
The rating on the proposed notes is one notch lower than S&P's
corporate credit rating on CEVA. It is based on preliminary
information and is subject to S&P's satisfactory review of the
final documentation. The recovery and issue ratings could be
subject to further review if the amount or terms of the notes were
to change.
CEVA intends to use the proceeds from the proposed notes to
finance the tender for its US$400 million 10% second-lien notes
and EUR210 million-equivalent 12% second-lien notes, both due in
2014. In case the amount outstanding under each of the second-
lien issues after the tender is less than 90% of the original
amount, the security package provided to the second-lien notes
would be released and substantially all of the restrictive
covenants and certain events of default would be eliminated. In
this case, S&P believes that any notes outstanding under the 10%
and 12% issues would rank pari passu with the 8.5% senior
unsecured notes. S&P's ratings reflect S&P's assumption that any
10% and 12% notes outstanding after the tender would see their
terms and conditions changed as described above.
S&P notes that together with refinancing the second-lien debt,
CEVA's main shareholder, Apollo Management (not rated), intends to
extend to 2018 the maturities of more than EUR590 million of
CEVA's senior and subordinated unsecured debt that it owns. This
has no bearing on S&P's recovery ratings.
Recovery Analysis
In S&P's simulated default scenario, recovery expectations for the
proposed senior secured notes are based on their claim on
unpledged assets, on which they share a pari passu claim with any
unsatisfied portion of CEVA's outstanding first-lien facilities,
one-and-a-half-lien notes, second-lien notes, and senior unsecured
notes. The valuation of the unpledged assets at default, in S&P's
view, would derive from the cash flows generated by CEVA's
nonguarantor subsidiaries. Under its assumptions, S&P
approximates such cash flows by using EBITDA before nonrecurring
items. Nevertheless, given the reduction in the profitability of
the guarantor subsidiaries, S&P has changed its assumption
regarding the value leakage to unpledged assets to 30% from 20%.
S&P may further increase the assumed level of such leakage in the
future if the profitability of the guarantor subsidiaries does not
revert to its normal level.
S&P values the business as a going concern. Given what S&P sees
as CEVA's good market position and valuable customer base, S&P
believes that a hypothetical default would be most likely to
result from significant leverage and absolute debt, combined with
assumed further operational underperformance.
Under S&P's simulated default scenario, a default is modeled to
occur in 2011, with some cash assumed to be still available on
balance sheet. S&P assumes that the group will seek protection
from creditors through a voluntary bankruptcy filing or another
exchange offer to ease the pressure on an overleveraged capital
structure, in the context of an uncertain trading environment.
The recovery ratings on the proposed junior priority senior
secured notes, senior secured bank facilities, one-and-a-half-lien
notes, and second-priority notes take into account the level of
expected prior-ranking and pari passu liabilities, the potential
for cross-jurisdictional insolvency issues, and the relatively
weak security package. The newly issued senior secured notes and
existing second-priority noteholders benefit from essentially the
same security package as the creditors under the bank facilities
and the one-and-a-half-lien notes, but have a third- and fourth-
ranking claim, respectively. The recovery ratings assume that the
security available to the bank facilities' secured debtholders is
taken from the assets and share pledges of entities that generate
about 50% of CEVA Ltd.'s EBITDA. S&P believes that the recoveries
for the secured bank debtholders could be lower should the
security package encumber materially less than 50% of CEVA's
business at default.
With limited residual secured value available, in S&P's view,
coverage for the proposed senior secured, one-and-a half-lien
notes, and second-priority notes is toward the lower end of the
10%-30% range and comes mainly from their pari passu claim on the
assets not captured by the security package.
S&P's analysis is based on the current capital structure.
However, in S&P's view, the documentation provides limited
protection for creditors. As a result, S&P believes that CEVA
could raise additional debt, which may have an adverse effect on
the recovery outcome for creditors lower than the most senior
level.
Ratings List
CEVA Group PLC
Rating Assigned
Up to EUR500 mil. senior
secd (proposed) notes CCC
Recovery Rating 5
Ratings Affirmed
Senior secured
US$250 mil. sr secd revolving credit B-
fac bank ln ser due 11/04/2012
Recovery Rating 2
US$250 mil. LOC fac bank ln ser due B-
11/30/2013
Recovery Rating 2
US$1 bil. var rate sr secd bank ln B-
ser due 11/04/2013
Recovery Rating 2
US$210 mil. 11.6% sr secd 1.5 priority CCC
nts ser due 2016
Recovery Rating 5
US$400 mil. 10% sr secd 2nd priority CCC
nts ser due 09/01/2014
Recovery Rating 5
EUR210 mil. equivalent 12%
senior secured notes CCC
due 09/01/2014
Recovery Rating 5
Senior unsecured
EUR505 mil. 8.5% bonds due 12/01/2014 CCC
Recovery Rating 5
Subordinated
EUR225 mil. 10% sub-bonds due 12/01/2016 CCC-
Recovery Rating 6
=============
R O M A N I A
=============
* ROMANIA: Firms File for Insolvency to Avail Law's Benefits
------------------------------------------------------------
Ziarul Financiar reports that Dan Costinescu, partner at law firm
Schoenherr si Asociatii, on Wednesday said Romanian companies
filing for insolvency don't have plans to reorganize their
business and are just looking to benefit from the bankruptcy law's
advantages such as evading foreclosure and debt and penalty
payments.
The report notes Mr. Costinescu said insolvency is also used by
creditors as a way to recover debt.
"Insolvency may become a way to protect debtors rather than a
measure used to pressure debtors," the report quoted Mr.
Costinescu as saying.
The report relates Mr. Costinescu explained insolvency doesn't
always entail bankruptcy and judicial reorganization may be a
solution to revamp a business.
The report recalls over 2,000 companies entered insolvency
procedures in January 2010, nearly 10% more than in December last
year. Also, in 2009, 18,421 companies filed for insolvency, the
report says citing Trade Registry data.
===========
R U S S I A
===========
ALLIANCE OIL: Fitch Assigns 'B' Final Senior Unsecured Rating
-------------------------------------------------------------
Fitch Ratings has assigned Alliance Oil Company Ltd.'s debut 5-
year US$350 million 9.875% Eurobond issue a final senior unsecured
foreign currency rating of 'B' and a Recovery Rating of 'RR4'.
Fitch withdrew its expected rating of the Eurobond issue on
February 26, 2010, following Alliance Oil's announcement that it
would not proceed with the proposed bond offering on February 25,
2010. The assignment of the final rating follows a reversal of
the company's previous decision.
Senior unsecured debt holders are not viewed by Fitch as being
negatively impacted by either the lack of an upstream guarantee by
the refining operating company to the holding company, or by a
pledge of the refining company's assets to ring-fenced secured
lenders. Fitch believes sufficient assets are in place elsewhere
in the Group to achieve average recovery of principal in the event
of default. These factors support the assignment of the 'RR4'
Recovery Rating.
Fitch assigned Alliance Oil Long-term foreign and local currency
Issuer Default Ratings of 'B', Short-term foreign and local
currency IDRs of 'B' and a National Long-term rating of 'BBB(rus)'
on February 10, 2010.
Alliance Oil is one of Russia's second tier integrated oil
companies producing approximately 44,000 barrels of oil per day in
2009, primarily in the Volga Urals with a growing presence in
Timano-Pechora. The company also has a refining capacity of
70,000 barrels per day at its Khabarovsk refinery located in
Russia's Far East.
===========
S W E D E N
===========
FORD MOTOR: Geely May Have to Spend SEK10 Bil. to Revive Volvo
--------------------------------------------------------------
Zhejiang Geely Holding Group Co. may have to spend at least SEK10
billion (US$1.4 billion) to revive Volvo Cars after buying the
Swedish brand from Ford Motor Co., Ola Kinnander and Keith
Naughton at Bloomberg News report, citing Volvo union officials
and board members.
Bloomberg relates Glenn Magnusson, head of the managers' union at
Gothenburg, Sweden-based Volvo, said in an interview the figure
would be "an absolute minimum" for financing car development,
marketing, production and distribution in the next year, and the
money needed could be double that amount.
According to Bloomberg, three people familiar with the talks said
Ford and Geely will probably sign a purchase agreement on the
estimated US$2 billion transaction toward the end of the month.
Bloomberg notes two of the people said regulatory approvals would
come after any signing, followed by a transfer of ownership by
June 30.
Bloomberg recalls four unions said Feb. 5 that they would accept
Geely as the new owner of Volvo as long as the Chinese
manufacturer proves it can fund operations.
Geely "will need to invest in Volvo's operations at least as much
as they're paying to buy us," Bloomberg quoted Magnus Sundemo, a
Volvo board member who represents the engineering union, as saying
in a telephone interview. "We have big investment needs,
especially if we're going to grow significantly in China."
Mr. Sundemo, as cited by Bloomberg, said the spending would be
necessary to realize Geely's goal of building 200,000 Volvo cars a
year in China, and to rebuild dealers' network.
Ford, which lost US$30 billion in the three years beginning in
2006, put Volvo up for sale in late 2008, part of a strategy of
dropping European luxury lines to concentrate on its namesake
brand, Bloomberg recounts. The last time Volvo reported a profit
was in 2005, when it had pretax earnings of US$377 million,
Bloomberg notes.
About Ford Motor
Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) --
http://www.ford.com/-- manufactures or distributes automobiles
across six continents. With about 200,000 employees and about 90
plants worldwide, the company's automotive brands include Ford,
Lincoln, Mercury and Volvo. The company provides financial
services through Ford Motor Credit Company.
At Sept. 30, 2009, the Company had US$203.106 billion in total
assets against US$210.376 billion in total liabilities.
On March 4, 2009, Ford deferred future interest payments on its
6.50% Junior Subordinated Convertible Debentures due January 15,
2032, beginning with the April 15, 2009 quarterly interest
payment.
As reported by the Troubled Company Reporter on Nov. 4, 2009,
Moody's Investors Service upgraded the senior unsecured rating of
Ford Motor Credit Company LLC to B3 from Caa1. This follows
Moody's upgrade of Ford Motor Company's corporate family rating to
B3 from Caa1, with a stable outlook. Ford Credit's long-term
ratings remain on review for further possible upgrade.
On Nov. 3, 2009, S&P raised the corporate credit ratings on Ford
Motor Co. and Ford Motor Credit Co. LLC to 'B-' from 'CCC+'. Ford
Motor Co. carries a long-term issuer default rating of 'CCC', with
a positive outlook, from Fitch Ratings.
===========================
U N I T E D K I N G D O M
===========================
BRITISH AIRWAYS: Union Talks Over Pay Cuts Collapse
---------------------------------------------------
Steven Rothwell at Bloomberg News reports that British Airways
plc's talks with Unite over pay cuts broke down.
According to Bloomberg, Unite, which represents the airline's
cabin crew, has the legal authority to announce a strike any time
before March 15.
"Despite a prolonged period of negotiations, it has not been
possible to reach agreement between BA and Unite," Bloomberg
quoted Brendan Barber, general secretary of the Trades Union
Congress, which had brokered the talks, as saying in a statement
Wednesday.
Bloomberg relates discussions broke down after British Airways
rejected union proposals for a 2.6% pay cut, lower staffing levels
and a reduction in allowances. Bloomberg notes the London-based
carrier said the package fell "significantly short" of the GBP63-
million (US$94 million) saving claimed by Unite and that its own
blueprint would achieve the sum without any wage reduction for
serving employees.
In an e-mailed response to Bloomberg's questions, British Airways
said the airline's strategy includes "minor changes to onboard
crew numbers," while necessitating no reductions in pay for
serving flight attendants.
Bloomberg recalls Unite won backing for a strike in a month-long
poll of workers that ended Feb. 22.
About British Airways
Headquartered in Harmondsworth, England, British Airways Plc,
along with its subsidiaries, (LON:BAY) -- http://www.ba.com/-- is
engaged in the operation of international and domestic scheduled
air services for the carriage of passengers, freight and mail and
the provision of ancillary services. The Company's principal
place of business is Heathrow. It also operates a worldwide air
cargo business, in conjunction with its scheduled passenger
services. The Company operates international scheduled airline
route networks together with its codeshare and franchise partners,
and flies to more than 300 destinations worldwide. During the
fiscal year ended March 31, 2009 (fiscal 2009), the Company
carried more than 33 million passengers. It carried 777,000 tons
of cargo to destinations in Europe, the Americas and throughout
the world. In July 2008, the Company's subsidiary, BA European
Limited (trading as OpenSkies), acquired the French airline,
L'Avion.
* * *
As reported in the Troubled Company Reporter-Europe on Nov. 12,
2009, Moody's Investors Service placed the Ba3 Corporate Family
and Probability of Default Ratings of British Airways plc and the
senior unsecured and subordinate ratings of B1 and B2 under review
for possible downgrade.
Moody's said the rating action reflects the continued weakening in
profitability in the first half of FY2010 (to September 2009),
with an operating loss of GBP111 million reported versus a profit
of GBP140 million a year earlier (post restructuring charges), and
Moody's view that losses in FY2010 will likely be higher than in
FY2009. This comes in spite of lower operating costs, notably for
fuel, as demand in the industry remains very depressed, while the
company has successfully reduced its employee and selling costs.
Reported net debt remained constant during the period, partly
benefiting from a positive exchange rate impact, although Moody's
debt metrics also incorporate the full value of the convertible
notes issued in August 2009.
BRITISH AIRWAYS: Offers Concessions to Win Iberia-AA Tie-Up OK
--------------------------------------------------------------
Nikki Tait and Gill Plimmer at The Financial Times report that
British Airways, American Airlines and Iberia have offered to give
up a handful of landing and take-off slots in London and New York
in an attempt to win approval for their proposed trans-Atlantic
alliance.
According to the FT, the concessions, designed to address concerns
that the tie-up will hurt competition on trans-Atlantic routes,
will be tested by the European Union with rival companies. The FT
relates the EU antitrust agency said on Wednesday that interested
parties had until April 10 to submit their views.
The airlines also need Washington's approval for the tie-up, the
FT notes.
The FT recalls the three airlines received a tentative go-ahead
from the US Department of Transportation in February after they
agreed to surrender four slot pairs at Heathrow. That preliminary
ruling is also open to feedback from third parties, the FT states.
The FT discloses under the latest concessions the airlines offered
to lease two daily pairs of slots from Heathrow or Gatwick airport
to Boston; one daily pair of slots from Heathrow or Gatwick to
Dallas-Fort Worth; and one daily pair from Heathrow or Gatwick to
Miami. In addition, they could be required to lease two daily
pairs from Heathrow or Gatwick to New York, depending on market
conditions, the FT says.
About British Airways
Headquartered in Harmondsworth, England, British Airways Plc,
along with its subsidiaries, (LON:BAY) -- http://www.ba.com/-- is
engaged in the operation of international and domestic scheduled
air services for the carriage of passengers, freight and mail and
the provision of ancillary services. The Company's principal
place of business is Heathrow. It also operates a worldwide air
cargo business, in conjunction with its scheduled passenger
services. The Company operates international scheduled airline
route networks together with its codeshare and franchise partners,
and flies to more than 300 destinations worldwide. During the
fiscal year ended March 31, 2009 (fiscal 2009), the Company
carried more than 33 million passengers. It carried 777,000 tons
of cargo to destinations in Europe, the Americas and throughout
the world. In July 2008, the Company's subsidiary, BA European
Limited (trading as OpenSkies), acquired the French airline,
L'Avion.
* * *
As reported in the Troubled Company Reporter-Europe on Nov. 12,
2009, Moody's Investors Service placed the Ba3 Corporate Family
and Probability of Default Ratings of British Airways plc and the
senior unsecured and subordinate ratings of B1 and B2 under review
for possible downgrade.
Moody's said the rating action reflects the continued weakening in
profitability in the first half of FY2010 (to September 2009),
with an operating loss of GBP111 million reported versus a profit
of GBP140 million a year earlier (post restructuring charges), and
Moody's view that losses in FY2010 will likely be higher than in
FY2009. This comes in spite of lower operating costs, notably for
fuel, as demand in the industry remains very depressed, while the
company has successfully reduced its employee and selling costs.
Reported net debt remained constant during the period, partly
benefiting from a positive exchange rate impact, although Moody's
debt metrics also incorporate the full value of the convertible
notes issued in August 2009.
CABLE & WIRELESS: UK Business to Focus on Asian Opportunities
-------------------------------------------------------------
Andrew Parker at The Financial Times reports that C&W Worldwide,
Cable & Wireless Plc's UK business, is stepping up its efforts to
achieve growth in emerging markets as it secures a stock market
listing later this month.
Chief Executive Jim Marsh told the Financial Times that C&W
Worldwide will focus on opportunities in Asia.
The FT relates that C&W Worldwide is one of two listed companies
resulting from the C&W group demerger that takes place on
March 26.
According to the FT, C&W Worldwide provides telecom services to
corporate rather than residential consumers. On the other hand,
the FT notes, C&W Communications, the other listed company,
provides fixed-line and mobile services to consumers in small
countries across the world that were once part of the British
empire.
While 54% of C&W Worldwide's revenue came from contracts with
British companies and public bodies in the six months to
September 30, says the FT, a further 7% stemmed from similar deals
outside the UK.
The FT states that given C&W Worldwide's share of the global
corporate telecoms market is less than 1%, it perceives a big
opportunity for overseas growth.
Mr. Marsh told the FT that C&W Worldwide's Asian orders rose 60%
in the three months to December 30 compared with the same period
in 2008. India was already its most important market after the
UK, he added.
"We have a fabulous brand in Asia because we've been there for 120
years," the FT quoted Mr. Marsh as saying. "So, building our
business particularly in that region is very important to us."
About Cable & Wireless
Headquartered in London, England, Cable & Wireless plc --
http://www.cw.com/-- is an international telecommunications
company. The Company offers mobile, broadband and domestic and
international fixed line services to homes, small and medium-sized
enterprises, corporate customers and governments. It operates in
39 countries through four major operations in the Caribbean,
Panama, Macau and Monaco & Islands. It operates through two
businesses: International and Europe, Asia & US. Its
International business operates full service telecommunications
companies through four major operations in the Caribbean, Panama,
Macau and Monaco and Islands. Its Europe, Asia & US provides
enterprise and carrier solutions to the largest users of telecom
services across the United Kingdom, continental Europe, Asia and
the United States. Its subsidiaries include Cable & Wireless UK,
Cable & Wireless Jamaica Ltd, Cable & Wireless Panama, SA, Cable &
Wireless (Barbados) Ltd and Monaco Telecom SAM.
* * *
According to Bloomberg data, Cable & Wireless plc continues to
carry Moody's "Ba3"long-term corporate family rating, "B1"senior
unsecured debt rating and "Ba3"probability of default rating with
a stable outlook.
The company continues to Standard & Poor's "BB-"long-term foreign
and local issuer credit ratings and "B" short-term foreign and
local issuer credit ratings.
CRU INVESTMENT: High Court Winds Up Business
--------------------------------------------
Daniel Grote at citywire reports that Cru Investment Management,
which marketed the six suspended Arch Cru funds, has been wound up
in the High Court. The report relates the court decided to
subject the firm to a creditors voluntary liquidation order.
According to the report, Investec Asset Finance asked to withdraw
a winding-up petition it filed against Cru because it was advised
that the company had filed for voluntary liquidation on February
12.
According to the report, had Investec not withdrawn the request,
an official receiver would have been appointed and the government
would have taken a 17% cut of any assets realized from the
company.
A meeting of Cru creditors will take place on March 23 at the
Future Inn, Cardiff Bay, Hemingway Road at 11:30 a.m., the report
discloses.
A list of creditors will be available for inspection at the
offices of Harris Lipman, which has been appointed as liquidators
for Cru, the report says.
EMI GROUP: EMI Music Chief Quits Post; Charles Allen Takes Over
---------------------------------------------------------------
The Financial Times reports that EMI Music on Wednesday said Elio
Leoni-Sceti, its chief executive, is to leave after just 18 months
and before completing a rescue plan. According to the FT, Mr.
Leoni-Sceti is to be replaced by Charles Allen, the former chief
executive of ITV, who will step up from non-executive chairman to
executive chairman.
The FT relates it also emerged that Guy Hands' Terra Firma private
equity firm, which owns EMI, has appointed David Frauman, a
financial restructuring specialist, to the board of Maltby
Investments, the vehicle it used to acquire the music group.
The FT says as Maltby controls the company that holds EMI's debts
and has to represent both its shareholder and lender, Mr. Frauman
could play a crucial role in mediating between Terra Firma and
Citigroup, which holds GBP3.2 billion (EUR3.5 billion, US$4.8
billion) of debt in EMI, in any restructuring, new equity
injection or legal dispute.
Terra Firma has until June to present its investors with a
strategic plan to persuade them to inject an extra GBP120 million
into the company and prevent a breach of covenants that could see
Citigroup seize EMI, the FT notes. There has been increasing
speculation that EMI could end up being sold to, or merged with,
Warner Music, the FT states.
As reported by the Troubled Company Reporter-Europe on Feb. 8,
2010, The FT said KPMG, EMI Group's accountants, raised
"significant doubt" about the company's ability to continue as a
going concern. According to the FT, accounts for the year to
March 2009, released on Feb. 9, however, make clear that even if
Terra Firma secures this equity, it will face another "significant
shortfall" against a test on covenants in its loans by March 2011.
The FT said unless it can persuade Citigroup to restructure its
GBP3.2 billion in loans by then, investors face further cash
calls. The FT disclosed EMI's pre-tax losses for the year to
March 2009 widened to GBP1.7 billion, against a GBP414 million
loss for the previous period, which covered the first eight months
and 21 days of Terra Firma's ownership.
EMI -- http://www.emigroup.com/-- is the fourth largest record
company in terms of market share (behind Universal Music Group,
Sony Music Entertainment, and Warner Music Group). It houses
recorded music segment EMI Music and EMI Music Publishing. EMI
Music distributes CDs, videos, and other formats primarily through
imprints and divisions such as Capitol Records and Virgin, and
sports a roster of artists such as The Beastie Boys, Norah Jones,
and Lenny Kravitz. EMI Music Publishing, the world's largest
music publisher, handles the rights to more than a million songs.
EMI Music operates through regional divisions (EMI Music North
America, International, and UK & Ireland). Private equity firm
Terra Firma owns EMI.
IMPERIAL PROPERTY: In Administration; 30 Jobs Affected
------------------------------------------------------
Catherine Evans at Gwent Gazette reports that Imperial Property
Company has gone into administration, resulting in the loss of 30
jobs. According to the report, the company, which developed and
owned the 21-storey Radisson Blu Hotel in Cardiff, owing an
estimated GBP3 million to contractors and leaving the project
incomplete.
The hotel -- managed and run by international chain Radisson --
remains open while administrators Deloitte attempt to sort out the
situation, the report notes.
MARC CDO: S&P Lowers Ratings on Six Classes of Notes to 'CC'
------------------------------------------------------------
Standard & Poor's Ratings Services lowered to 'CC' from 'CCC-' its
credit ratings on the class A-1, A-2, B, C, D, and E notes in Marc
CDO I PLC's US$120 million secured floating-rate credit-linked
notes.
The downgrades to 'CC' follow the trustee's notification to S&P
that losses from credit events in the underlying reference
portfolios have led to a principal writedown of the notes. In
S&P's opinion, the repayment of principal to each noteholder is
highly unlikely, therefore S&P has lowered the notes to 'CC'.
Ratings List
Marc CDO I PLC
US$120 Million Secured Floating-Rate Credit-Linked Notes
Ratings Lowered
Rating
------
Class To From
----- -- -----
A-1 CC CCC-
A-2 CC CCC-
B CC CCC-
C CC CCC-
D CC CCC-
E CC CCC-
NORTHERN ROCK: Bad Bank Set to Return to Profit This Year
---------------------------------------------------------
Sharlene Goff at The Financial Times reports that Northern Rock
plc's "bad bank" is on course to return to profit as early as this
year, well ahead of the so-called good part of the nationalized
lender.
According to the FT, Gary Hoffman, Northern Rock's chief
executive, said the asset management business that includes the
portfolio of "Together" mortgages -- the controversial loans that
offered up to 125 %of a property's value before the housing crash
-- had "turned the corner" and was "likely to move into profit
quite quickly".
"Everyone thinks of this as the 'bad' bank," the FT quoted
Mr. Hoffman as saying. "But looking at its characteristics, only
8% of loans are in arrears and the peak of impairments is behind
us."
The FT notes profits at the newly formed Northern Rock plc, the
small, deposit-rich bank earmarked for sale because of its ongoing
profit potential, could be constrained until well into 2011.
The FT discloses this part of Northern Rock is one of the best-
capitalized banks in the industry with GBP19.5 billion (US$29.2
billion) of retail deposits and only GBP10 billion of mortgages.
But this means it is paying interest on a savings book that is
almost double the size of its mortgage pool, the FT states.
About Northern Rock
Headquartered in Newcastle upon Tyne, England, Northern Rock plc
-- http://www.northernrock.co.uk/-- deals with mortgages, savings
accounts, loans and insurance. The company also promotes secured
loans to its existing mortgage customers. The company had more
than US$200 billion in assets at the end of June 2007.
* * *
As reported by the Troubled Company Reporter-Europe on Dec. 11,
2009, Standard & Poor's Ratings Services raised the rating on
Northern Rock's dated subordinated lower Tier 2 debt to 'BB' from
'CCC'. The ratings on its perpetual subordinated debt and
preference shares were unaffected. S&P said the outlook is
stable.
PERSEUS PLC: Fitch Downgrades Rating on Class D Notes to 'B'
------------------------------------------------------------
Fitch Ratings has downgraded Perseus (European Loan Conduit No.
22) plc's class B, C and D commercial mortgage-backed notes, due
July 2014, and affirmed the transaction's three senior note
tranches:
-- GBP196.8m class A1 (XS0235325577) affirmed at 'AAA'; Outlook
Stable
-- GBP184.9m class A2 (XS0238677883) affirmed at 'AAA'; Outlook
Stable
-- GBP44.5m class A3 (XS0238678428) affirmed at 'AAA'; Outlook
Stable
-- GBP44.8m class B (XS0235326039) downgraded to 'A' from 'AA';
Outlook Negative
-- GBP15.1m class C (XS0235326203) downgraded to 'BB' from 'A';
Outlook Negative
-- GBP4.7m class D (XS0235326542) downgraded to 'B' from 'BBB';
Outlook Negative
The downgrades are primarily driven by the imminent maturities of
three of the loans comprising 28.2% of the loan pool balance and
the deteriorating performance of the Yate loan (13% of the loan
pool).
The five loans are secured by office, retail and shopping centre
properties located throughout England, Scotland and Northern
Ireland, with an aggregate market value of GBP859.5 million as
reported at the January 2010 interest payment date. With the
exception of the Ladysmith and Yate loans, whose collateral was
revalued in October 2008 and November 2007, respectively, as well
as certain properties within the Mapely Cloumbus portfolio
revalued in April 2009, the servicer has not obtained new
valuations since the transaction's closing date in December 2005.
Although the loans show relatively modest reported loan-to-value
ratios, they all include subordinated B notes that significantly
increase the whole loan LTVs and therefore the overall balloon
risk. This is especially relevant given that three loans are
scheduled to mature within the next nine months.
Although the trend for secondary and tertiary properties remains
uncertain, market research suggests that yields on UK commercial
real estate have started to stabilize, particularly across prime
markets. The assets in the reference portfolio are made up of
both prime and secondary assets. A combination of deteriorating
market conditions since closing as well as falling income on some
of the loans has resulted in a weighted average (WA) Fitch LTV of
80% compared to a WA reported LTV of 57.4%.
Whilst the performance of the portfolio has remained relatively
stable over the past year, there has been some deterioration in
the performance of the Yate loan. The loan has a whole loan
reported LTV of 82.7% based on a November 2007 valuation, which is
in breach of the whole loan LTV covenant of 80%. In addition, the
whole loan ICR is currently at 1.07x, which is below the 1.10x
dividend trap trigger. As a result of these two breaches, the
servicer is currently trapping surplus cash in an escrow account,
the balance of which presently stands at GBP2.4 million. A total
of 10 tenants (16% of in-place rent) remain in administration and
continue to accrue rental arrears. While the risk of a default
during the loan term is somewhat mitigated by the cash trapping
mechanism, the asset may suffer further income and/or value
declines in the future.
The transaction has a significant concentration in the Mapeley
Columbus loan (58.7% of the loan pool), which is a refinancing of
the sale and leaseback of Abbey National plc's ('AA-'/Outlook
Stable /'F1+') entire real estate portfolio, which was initially
carried out in 2000. Fitch calculates a current LTV of 75.1% for
the loan as compared to a reported LTV of 54.9%.
Fitch employed its criteria for European CMBS surveillance to
analyze the quality of the transaction's underlying commercial
real estate loan pool. Applicable criteria available on Fitch's
website at www.fitchratings.com: 'Criteria for European CMBS
Surveillance (Europe CMBS)', dated November 12, 2008, and 'Global
Structured Finance Rating Criteria', dated September 30, 2009. In
addition to this methodology, Fitch simulated tenant default and
lease renewal scenarios in its analysis of this transaction.
Fitch will continue to monitor the performance of the transaction.
PORTSMOUTH FOOTBALL: Axes 85 Jobs, Administrator Says
-----------------------------------------------------
Portsmouth Football Club is cutting 85 jobs from a total of more
than 360, Peter-Joseph Hegarty at Bloomberg News reports citing
Andrew Andronikou, the administrator handling the case.
Bloomberg relates Mr. Andronikou, speaking at a televised news
conference, said the job cuts don't affect players, whose salaries
can't be reduced.
According to Bloomberg, the administrator said more reductions
will be made if the team, which is at the bottom of the Premier
League, is demoted to the second tier.
Citing Bloomberg News, the Troubled Company Reporter-Europe,
reported that Portsmouth on Feb. 26 became the first team in
England's Premier League to go into administration after U.K.
authorities tried to force its closure over unpaid taxes. Michael
Kiely, Peter Kubik and Andrew Andronikou at UHY Hacker Young were
appointed joint administrators to the company and the football
club.
As reported by the Troubled Company Reporter-Europe on March 4,
2010, Bloomberg News said the High Court ordered that there must
be another hearing during the week starting March 15 to examine
the validity of the appointment of Portsmouth's administrators.
Bloomberg disclosed Judge Norris said that before the hearing he
wants to see evidence relating to financial transactions between
Portpin Ltd., Portsmouth-owner Balram Chainrai's company, and the
club, which has debts of about GBP78 million (US$117 million).
According to Bloomberg, Gregory Mitchell, a lawyer for the tax
office, said at a March 2 hearing that while the government
supports the administration "in principle" if it is the best way
for the club to meet its debts, the tax office wants the court to
look into decisions made by the club and its owners before
allowing it to proceed with bankruptcy protection. Mr. Mitchell,
as cited by Bloomberg, said the court should decide whether the
administrators have been "properly appointed" and whether they are
independent. According to Bloomberg, the lawyer said proof is
needed that the administrators will be able to raise enough money
to meet the club's "financial needs". The club has unpaid tax of
GBP12.1 million, Bloomberg disclosed.
Portsmouth Football Club Ltd. -- http://www.portsmouthfc.co.uk/--
operates Portsmouth FC, a professional soccer team that plays in
the English Premier League. Established in 1898, the club boasts
two FA Cups, its last in 2008, and two first division
championships. Portsmouth FC's home ground is at Fratton Park;
the football team is known to supporters as Pompey. Dubai
businessman Sulaiman Al-Fahim purchased the club from Alexandre
Gaydamak in 2009. A French businessman of Russian decent,
Gaydamak had controlled Portsmouth Football Club since 2006.
REGUS PLC: Demands Rent Cuts, Concessions From Landlords
--------------------------------------------------------
Daniel Thomas at The Financial Times reports that Regus plc has
demanded a package of rental cuts and concessions from landlords
of loss-making buildings under a plan that could see parts of its
business being put into administration.
Regus, the FT says, has asked different landlords for cash to
carry out refurbishment works, periods without any rent and a cut
in future rents.
According to the FT, landlords said there was the prospect of
Regus' vehicles that own the leases going into administration,
leaving them without a tenant, if they did not agree to the terms.
Regus plc -- http://www.regus.com/-- is a provider of global
office outsourcing services. The Company is organized into four
geographical segments: Americas; Europe, Middle East and Africa
(EMEA); Asia Pacific, and the United Kingdom. As of December 31,
2008, the Company had 978 business centers. The Company has 495
centers across 14 countries in North and South America. The
Company operated 131 centers in the United Kingdom. The Company
has 240 centers across 43 countries in EMEA. The Company operates
112 centers across 15 countries in Asia Pacific. On April 2,
2008, the Company acquired Stonemartin. On October 14, 2008, the
Company acquired Regus Group plc. On November 30, 2008, the
Company acquired Stonemartin Corporate Centres Limited.
ROYAL BANK: Seeks Securities License in China, FT Says
------------------------------------------------------
The Financial Times reports that Royal Bank of Scotland Plc is
seeking a securities license in China as part of plans to
refashion its mainland business.
The bank has signed a securities joint venture deal with a local
partner and applied to Beijing for regulatory approval, the FT
says citing people familiar with the matter.
The FT relates that the move comes as European regulators are
forcing the bank to sell coveted assets.
John McCormick, RBS Asia Pacific chief executive, told the
Financial Times that the bank was working on several fronts to
expand its China platform.
"We have many 'acorns' planted in China and I am confident these
will grow steadily in the coming years," Mr. McCormick said,
according to the FT.
The Royal Bank of Scotland Group plc (NYSE:RBS) --
http://www.rbs.com/-- is a holding company of The Royal Bank of
Scotland plc (Royal Bank) and National Westminster Bank Plc
(NatWest), which are United Kingdom-based clearing banks. The
company's activities are organized in six business divisions:
Corporate Markets (comprising Global Banking and Markets and
United Kingdom Corporate Banking), Retail Markets (comprising
Retail and Wealth Management), Ulster Bank, Citizens, RBS
Insurance and Manufacturing. On October 17, 2007, RFS Holdings
B.V. (RFS Holdings), a company jointly owned by RBS, Fortis N.V.,
Fortis SA/NV and Banco Santander S.A. (the Consortium Banks) and
controlled by RBS, completed the acquisition of ABN AMRO Holding
N.V. (ABN AMRO). In July 2008, the company disposed its entire
interest in Global Voice Group Ltd.
* * *
As reported by the Troubled Company Reporter-Europe on Dec. 22,
2009, Fitch Ratings upgraded The Royal Bank of Scotland Group's
(RBS Group) and The Royal Bank of Scotland's Individual Ratings to
'D/E' from 'E' and removed the Rating Watch Positive. The upgrade
of the Individual Ratings reflects improvements in the group's
capital combined with some progress in restructuring the balance
sheet.
SHERWOOD CASTLE: Moody's Cuts Ratings on 2006-1 Notes to 'B1'
-------------------------------------------------------------
Moody's Investors Service has downgraded certain classes of asset-
backed notes issued and backed by receivables in the Castle
Receivables Trust. The rating actions conclude the review that
was initiated in June 2009. The assets backing the notes in the
master trust are receivables arising under designated revolving
credit card accounts originated in the UK by Capital One Bank
Europe PLC ("COBEP") (NR), a wholly owned subsidiary of Capital
One Bank (A2/P-1/Negative).
The notes were initially placed on review following a review of
the purchase rate assumption (refer to the original press release
dated June 18, 2009 for further details). Moody's has decreased
the purchase rate assumption for Castle Receivables Trust in order
for this assumption to be better aligned with the corresponding
assumption for the core US portfolio of Capital One Bank and also
with assumptions taken in other UK credit card trusts rated by
Moody's. Moody's believes that the current economic environment
places more importance in making this adjustment. Moody's notes
that this change of assumption is not prompted by a deterioration
in the performance of the trust.
Moody's has also decreased the benefit given to potential capture
of excess spread in the analysis of classes of notes that are
supported by trapping of excess spread (i.e. Classes C and Series
2006-1 Notes). Moody's has reduced the benefit ascribed to this
form of credit protection to better reflect the temporary nature
of such protection given that trapped excess spread can be
released if there is a temporary improvement in the excess spread
levels.
Moody's expects charge-offs to range between 9% and 12% and
payment rate to range between 9% and 11% over the medium to long-
term basis.
Issuer: Sherwood Castle Funding Series 2003-2 PLC
-- GBP215M A Notes, Downgraded to Aa1; previously on Jun 18,
2009 Aaa placed under review for possible downgrade
-- GBP15M B Notes, Downgraded to A3; previously on Jun 18, 2009
A2 placed under review for possible downgrade
-- GBP20M C Notes, Downgraded to Ba1; previously on Apr 16, 2009
Baa3 placed under review for possible downgrade
Issuer: Sherwood Castle Funding Series 2004-1 PLC
-- EUR529M A Notes, Downgraded to Aa1; previously on Jun 18,
2009 Aaa placed under review for possible downgrade
-- EUR44M B Notes, Downgraded to A3; previously on Jun 18, 2009
A2 placed under review for possible downgrade
-- EUR57M C Notes, Downgraded to Ba1; previously on Jun 18, 2009
Baa2 placed under review for possible downgrade
Issuer: Sherwood Castle Funding Series 2004-2 PLC
-- GBP210M A Notes, Downgraded to Aa1; previously on Jun 18,
2009 Aaa Placed Under Review for possible downgrade
-- GBP17.5M B Notes, Downgraded to A3; previously on Jun 18,
2009 A2 Placed Under Review for possible downgrade
-- GBP22.5M C Notes, Downgraded to Ba1; previously on Jun 18,
2009 Baa2 Placed Under Review for possible downgrade
Issuer: Sherwood Castle Funding Series 2005-1 PLC
-- GBP294M A Notes, Downgraded to Aa1; previously on Jun 18,
2009 Aaa placed under review for possible downgrade
-- GBP24.5M B Notes, Downgraded to A3; previously on Jun 18,
2009 A2 placed under review for possible downgrade
-- GBP31.5M C Notes, Downgraded to Ba1; previously on Jun 18,
2009 Baa2 placed under review for possible downgrade
Issuer: Sherwood Castle Funding Series 2006-1 PLC
-- GBP7.7M S1 Notes, Downgraded to B1; previously on Jun 18,
2009 Ba2 placed under review for possible downgrade
-- EUR26.5M S2 Notes, Downgraded to B1; previously on Jun 18,
2009 Ba2 placed under review for possible downgrade
Moody's ratings address only the credit risks associated with the
transaction, other non-credit risks have not been addressed, but
may have significant effect on yield to investors. Moody's
ratings are subject to revision, suspension or withdrawal at any
time at Moody's absolute discretion. The ratings are expressions
of opinion and not recommendations to purchase, sell or hold
securities. The rating is published. Moody's will publicly
disseminate any change in the ratings through normal print and
electronic media, and in response to requests to the Moody's
rating desk, in accordance with Moody's standard practice at the
time.
* UK: Automotive Sector Insolvencies Down 44.15% in January
-----------------------------------------------------------
The rate of business insolvencies for the automotive industry in
January 2010 was 44.15% lower than January 2009, and also half
(48%) the rate experienced in December 2009, according to the
latest Insolvency & Late Payment indices from Experian, the global
information services company.
Around 0.08% of automotive businesses became insolvent in January
2010, compared to 0.14 %in January 2009 and 0.15% in December
2009. Not since December 2008 has the rate been this low.
Payment performance among automotive businesses, itself an
indicator of business confidence, also improved throughout
January. Automotive businesses have managed to shave a day off
the time it takes to settle bills, down to 15.36 days beyond
agreed terms from 16.72 in January2009. The automotive industry
continues to be amongst the quickest to settle bills, slower only
than the agriculture/forestry/fishing, oil and servicing/repair
sectors.
The financial strength of the automotive industry also increased
year-on-year, going up to 79.91 from 78.78 in January 2009.
Mark Nuttall, General Manager of Experians automotive business,
said: "The Automotive industry has seen a good start to the year.
It is too early to say whether we are out of the woods yet. The
financial strength of the sector is still recovering from a
volatile 2009, however, the decrease in insolvencies and
improvement in payment performance in January are both good signs
for the industry.
"Irrespective of the economic climate, it is vital that dealers
use business information tools to manage their exposure to risk by
monitoring the health of their suppliers, customers and partners."
===============
X X X X X X X X
===============
* Bundesbank Head Calls for Reform of Future Banking Regulations
----------------------------------------------------------------
Brendan Keenan and Thomas Molloy at Irish Independent report that
Bundesbank president Axel Weber on Wednesday night said at the
Institute of European Affairs that future banking regulations must
be changed to allow some banks to fail.
According to the report, Mr. Weber, who is widely tipped to become
the next head of the European Central Bank and is now busy helping
to draft a new regulatory framework for world banks, said the
basic answer must be to increase the amount of money lenders have
to keep in reserve for emergencies, known as the Tier 1 capital
ratio.
The report relates Mr. Weber said The Tier 1 capital ratio should
be highest for banks which have a systemic importance and are too
big to fail. He added supervisors should be able to choose
restructuring over bail-outs, the report notes.
"Restructuring involving private investors would be the first
choice and clearly preferable to direct public intervention," the
report quoted Mr. Weber as saying.
Levy
The report relates Mr. Weber criticized plans for a levy on banks
that could be used to create a fund to bail out troubled European
banks in future crises.
First, it would drain capital from banks. But, more importantly,
it would not solve the moral hazard problem," Mr. Weber said,
according to the report. "As the fund would act as lender of
next-to-last resort for failing banks (the government would still
have to step in if the fund's resources were exhausted in a
crisis) the problem would merely be shifted from the level of
government to the level of the fund."
* BOOK REVIEW: Instincts of the Herd in Peace and War
-----------------------------------------------------
Author: Wilfred Trotter
Publisher: Beard Books
Softcover: 264 pages
List Price: US$34.95
by Henry Berry
Instincts of the Herd in Peace and War examines how individuals
become involved in social groups and how this affects their
involvement in a nation, the ultimate social group. According to
Trotter, human beings are, by nature, "gregarious," and their
gregariousness is instinctive. Consequently, individuals are
compelled to attach themselves to a primary social group and
assume a role within it. Individuals may form attachments to
other groups and take different or modified roles within them, but
it is their attachment to, identification with, and role within a
primary group that lends them their personal identity, sense of
purpose, and sense of self-worth and fulfillment.
Although a nation is the ultimate group, it becomes the primary
social group only in the case of war. To Trotter, war and peace
are not mutually exclusive social states. They form a continuum
of historical social states that comprise the entirety of all
possible social states. There can be no utopias, nor can there be
eternal wars. The flow of events brings periods of peace and war.
The events in Europe preceding World War I -- the period during
which Trotter wrote the first edition of his book -- were a test
case for the author's observations and conclusions. The people of
England, France, Germany, and other European nations became
focused on defending their nations against external enemies.
Societies (i. e., nations) underwent upheaval as their people
turned from limited involvement with smaller social groups to
large-scale involvement in national defense.
Trotter's book is recognized as a classic in the field of
sociology, a relatively new science in the latter 1800s and early
1900s. Trotter and others sought to understand the group dynamics
of democratic societies, which were replacing the class structure
of aristocratic, hierarchal societies. Trotter also sought to
counter the misleading effects of psychology, especially the
influence of Freudian psychology, which saw individuals as
influenced mostly by inner, largely subconscious feelings and
experiences.
Trotter argues that psychology is not an independent field. Says
the author, "The two fields -- the social and the individual --
are absolutely continuous; all human psychology, it is contended,
must be the psychology of associated man, since man as a solitary
animal is unknown to us . . . ." Even a hermit is born in
society; and society has an interest in hermits for what they may
reflect about conditions of society.
This reprint is the second edition of Trotter's classic work. The
second edition includes the author's 45-page "Postscript of 1919,"
assaying the conditions of peace after World War I had ended.
"With the cessation of war this great stream of moral power [in
defending the nation] began rapidly to dry up at its source,"
observes Trotter. He proffers that the aim of statecraft is
keeping this "great stream of moral power" in times of peace. He
believes that the progressive evolution of society can be
accomplished by a "scientific statecraft [applying] the intellect
as an active factor in the direction of society."
While basically a work of sociology, Trotter's book can be a
picture of individual and group behavior for leaders in any
organization where motivation, unity, and progress are important.
This includes business leaders, especially leaders of larger
companies with multiple business sites and different employee
segments. Business leaders will immediately grasp the truth and
relevance of the author's view of society and glean from it
essential lessons and leadership principles, practices, and goals.
Wilfred Trotter (1872-1939) was an English surgeon as well as an
influential sociologist.
*********
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-Fernandez, Joy A. Agravante and Peter A. Chapman,
Editors.
Copyright 2010. 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 * * *