/raid1/www/Hosts/bankrupt/TCREUR_Public/100527.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
Thursday, May 27, 2010, Vol. 11, No. 103
Headlines
C Z E C H R E P U B L I C
ODEVNI PODNIK: Jan-May Loss Widens to CZK211.2 Million
E S T O N I A
TOPTOURS AS: Seeks Foreign Investors Following Insolvency
G E O R G I A
* GEORGIA: Fitch Affirms Long-Term Issuer Default Rating at 'B+'
G E R M A N Y
ARCANDOR AG: Karstadt Obtains Enough Tax Waivers to Allow Sale
ARCANDOR AG: Berggruen to Partner With BCBG for Karstadt Bid
FORCE 2005-1: Fitch Downgrades Rating on Class D Notes to 'B'
FORCE TWO: Fitch Junks Rating on Class C Notes From 'B'
I R E L A N D
KILLESHIN HOTEL: In Receivership; Owes EUR20MM to Creditor Bank
QUINN INSURANCE: Gets 900 Applications for Voluntary Redundancy
R U S S I A
FOREIGN ECONOMIC: S&P Gives Positive Outlook; Keeps 'B-' Rating
GLAVMOSSTROY OAO: Moscow Court Ends Bankruptcy Proceedings
SOGAZ OJSC: S&P Raises Counterparty Credit Rating to 'BB+'
ZLATOUST METALLURGICAL: Mechel May Acquire Chelyabinsk Facility
S P A I N
BODYBELL: Lenders Ask Owners to Inject More Cash
CORTEFIEL: Investors Inject New Capital to Reset Loan Terms
LEVANTINA: Debt-for-Equity Swap Deal Gives Lenders Control
PANRICO: Final Bids Due by June 30
* SPAIN: Four Savings Banks Submit Merger Proposal
U K R A I N E
NAFTOGAZ UKRAINY: No Bankruptcy Threat, Ukrainian Minister Says
UKRAINIAN FOOD: Declared Bankrupt; Court Initiates Liquidation
U N I T E D K I N G D O M
AEOLUS CDO: S&P Junks Ratings on Five Classes of Notes
ANTLER LUGGAGE: Sale to Lloyds Raises Conflict of Interest Queries
BRITISH AIRWAYS: To Challenge Legality of Cabin Crew Strikes
BROOKLANDS HEALTH: Goes Into Administration
PRIME TIME: Silver Strawberry Buys Firm for More Than GBP1 Mil.
* UNITED KINGDOM: GBP55BB Comm. Property Loans Await Refinancing
X X X X X X X X
* Upcoming Meetings, Conferences and Seminars
*********
===========================
C Z E C H R E P U B L I C
===========================
ODEVNI PODNIK: Jan-May Loss Widens to CZK211.2 Million
------------------------------------------------------
CTK reports that Jaroslav Svoboda, Odevni podnik's insolvency
administrator, said at a meeting of creditors on Tuesday that the
company's loss increased to CZK211.2 million between January and
the beginning of May. According to the report, Mr. Svoboda said
the company's turnover reached CZK284.3 million over the period.
In April alone, the firm's loss amounted to CZK94.4 million, the
report notes.
The company, which employed 773 people, was declared bankrupt
early in May, the report recalls.
As reported by the Troubled Company Reporter-Europe on March 29,
2010, CTK said Odevni podnik, which has been insolvent since
January, owes around CZK1.6 billion to its creditors.
Odevni podnik is a textile company based in Prostejov, Czech
Republic.
=============
E S T O N I A
=============
TOPTOURS AS: Seeks Foreign Investors Following Insolvency
---------------------------------------------------------
Juhan Tere at The Baltic Course, citing LETA/Aripaev.ee, reports
that Khaled Ibrahim, manager of TopTours AS, hopes to relaunch the
company with the help of a foreign investor, LETA/Aripaev.ee
reports.
The report relates TopTours declared insolvency on May 21.
According to the report, Mr. Ibrahim said the cause for the
insolvency was the accumulating losses suffered due to the
Icelandic ash cloud, when the company had to pay for prolonged
accommodation of tourists and six empty flights to bring the
tourists home but also extra obligations it had due to the floods
in Madeira in February when it also had to send empty planes to
the resorts to pick up stranded tourists and had to suspend the
business for two weeks. The report notes Mr. Ibrahim said losses
from these two situations totaled EEK5-6 million.
According to the report, TopTours' manager said that they are
currently holding talks with Swiss and Italian international
operator firms who wish to expand to the Baltic market, adding an
Estonian private investor is also interested.
"I have decided to save the company and to make sure that the
company doesn't go bankrupt. In 3-4 weeks clarity should emerge
in the situation," the report quoted Mr. Ibrahim as saying.
TopTours AS is an Estonian travel agency.
=============
G E O R G I A
=============
* GEORGIA: Fitch Affirms Long-Term Issuer Default Rating at 'B+'
----------------------------------------------------------------
Fitch Ratings has affirmed Georgia's Long-term foreign and local
currency Issuer Default Ratings at 'B+'. At the same time, Fitch
has affirmed Georgia's Short-term foreign currency IDR at 'B' and
the Country Ceiling at 'BB-'. The Outlooks for the Long-term IDRs
are Stable.
"The Georgian economy is showing signs of recovery after the
severe shocks of the 2008 war with Russia, and the global
financial crisis, helped by huge international financial
assistance," said Ed Parker, Head of Emerging Europe in Fitch's
Sovereigns team. "However, risks remain over the extent of the
revival in private sector capital inflows, and fiscal retrenchment
needs to continue in order to return the country to a sustainable
macroeconomic position."
Economic recovery is underway, and Fitch forecasts GDP growth of
6% in 2010, after a decline of 3.9% in 2009. There is early
evidence of an improvement in trade performance: merchandise
exports grew 55% in Q110 yoy, compared with only 6% for imports.
Net equity FDI increased to 7.7% of GDP in 09H2 from 4.9% in 09H1.
However, Georgia has a sizeable current account deficit of 12% of
GDP in 2009, leaving the country highly dependent on external
financing. Private sector capital inflows will need to recover
strongly as IMF and other official financing taper off from around
2012, while external debt amortization steps up sharply in 2013
when the US$500 million sovereign eurobond matures. Net external
debt at 49% of GDP at end-2009 is well above the ten-year 'B'
range median of 15%.
Georgia ran a large budget deficit of 9.2% of GDP in 2009 and
needs to implement a multi-year fiscal retrenchment program to put
the public finances back onto a sustainable course.
Encouragingly, this is underway and the government has agreed with
the IMF to cut the deficit to 6.8% in 2010 and to around 2.5% by
2013. Against a track record of rapid real expenditure growth and
widening budget deficits between 2003 and 2008, Fitch views it as
positive for the program's credibility that the government is
planning to use revenue over-performance from stronger GDP growth
to speed up the reduction in the deficit. Government debt is
moderate at 35% of GDP at end-2009, below the 10-year 'B' range
median of 42%; and much of the debt is concessional, with long
maturities, grace periods and low interest rates.
Downside risks have eased in the banking sector, after the global
financial crisis precipitated major distress. It is well
capitalized and liquid, and asset quality has stabilized. But it
is highly dollarized, which renders macro-financial stability more
vulnerable to shocks and impairs the effectiveness of monetary and
exchange rate policy. Political risk is high and weighs on the
sovereign rating. Fitch does not anticipate renewed military
conflict with Russia or a major increase in domestic political
instability, but shocks cannot be ruled out.
Georgia's ratings are underpinned by its GDP per capita and level
of human development, which are well above the 'B' range medians,
favorable business climate -- underscored by its ranking of 11th
in the World Bank's Doing Business Survey -- generally good
governance and growth prospects, track record of relatively low
and stable inflation, and strong support from the international
community.
=============
G E R M A N Y
=============
ARCANDOR AG: Karstadt Obtains Enough Tax Waivers to Allow Sale
--------------------------------------------------------------
Karstadt, Arcandor AG's insolvent German department-store chain,
has obtained sufficient tax waivers from German cities to allow
the business to be sold, Holger Elfes at Bloomberg News reports,
citing Thomas Schulz, the administrator's spokesman.
According to the report, the city of Cologne said Tuesday in an
e-mail that it will waive tax claims against Karstadt.
On May 14, 2010, the Troubled Company Reporter-Europe, citing
Bloomberg News, reported that the cities of Bielefeld and Erding
rejected the administrator's request to waive the claims on taxes
they are owed by Karstadt, endangering Karstadt's sale. According
to Bloomberg, Mr. Schulz said under insolvency rules, 98% of a
total of 94 cities in which Karstadt have stores have to accept
the request to make the sale possible.
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.
ARCANDOR AG: Berggruen to Partner With BCBG for Karstadt Bid
------------------------------------------------------------
William Launder and Kirsten Bienk at Dow Jones Newswires report
that Nicolas Berggruen said that his bid for Karstadt, Arcandor
AG's insolvent department-store unit, includes a business
partnership with U.S. fashion company BCBG Max Azria, Inc.
"[BCBG] knows merchandising well, and that at the end of the day
is what matters," Mr. Berggruen told Dow Jones Newswires in an
interview. "Karstadt is a good name with good stores and very
good revenues. Like all such retailers they need something fresh,
and that's where BCBG comes in."
According to Dow Jones, Mr. Berggruen promised to invest "as much
as needed for his plan to work" but wouldn't provide specific
details on his Karstadt bid.
Mr. Berggruen, as cited by Dow Jones, said BCBG has been
conducting its own due diligence in Germany for weeks.
AS reported by the Troubled Company Reporter-Europe on May 25,
2010, Reuters said Mr. Berggruen made an offer to buy Karstadt a
week before an extended deadline for bids runs out. Dow Jones,
citing Handelsblatt, disclosed that Berggruen Holding Ltd., an
investment vehicle owned by private investor Mr. Berggruen, has
submitted a detailed bid for all of Karstadt's business
activities. According to Dow Jones, the Handelsblatt report,
citing a spokesman for Berggruen Holding, said the company hopes
to close the deal within the coming weeks although it is expected
that Karstadt's landlords will participate in the future
restructuring of the company and that the seven remaining
municipalities will agree to write-off the department store's
commercial tax debts.
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
FORCE 2005-1: Fitch Downgrades Rating on Class D Notes to 'B'
--------------------------------------------------------------
Fitch Ratings has downgraded FORCE 2005-1 Limited Partnership's
Class C and D notes by one and two notches, respectively,
following increased defaults during the past 12 months. These
classes of notes are now more vulnerable to additional defaults
during the remaining term of three years and refinancing risk at
maturity.
At the same time, Fitch has changed the Outlooks on the Class A
and B notes to Negative from Stable. The Loss Severity Ratings
have been revised due to increased loss expectations.
The transaction is a cash securitization of subordinated debt and
loss participation agreements of German SMEs. The portfolio
companies were selected by equiNotes Management GmbH, a joint
venture of IKB Deutsche Industriebank Aktiengesellschaft and
Deutsche Bank Aktiengesellschaft (DBAG), acting as advisor for the
issuer.
-- EUR178m Class A notes (ISIN: XS0237456156): affirmed at 'A',
Outlook revised to Negative from Stable; Loss Severity Rating
revised to 'LS-3' from 'LS-1'
-- EUR17.8m Class B notes (ISIN: XS0237456313): affirmed at
'BBB', Outlook revised to Negative from Stable, Loss Severity
Rating revised to 'LS-5' from 'LS-3'
-- EUR20.4m Class C notes (ISIN: XS0237456404): downgraded to
'BB-' from 'BB', Outlook Negative, Loss Severity Rating
revised to 'LS-5' from 'LS-3'
-- EUR18.5m Class D notes (ISIN: XS0237456826): downgraded to 'B'
from 'BB-', Outlook Negative, Loss Severity Rating revised to
'LS-5' from 'LS-3'
Since closing in 2005, there have been seven default events,
amounting to EUR43 million or 11.6% of the initial portfolio; of
this, 6% occurred during the last 12 months. The portfolio has
been further reduced by four early terminations since closing,
amounting to EUR15 million and or 4% of the initial portfolio,
which have resulted in the class A notes amortizing by the same
amount.
Despite the reduced portfolio notional, the transaction is still
able to trap excess spread, estimated to be roughly 8% over the
remaining term of the transaction. This, together with the zero
principal deficiency ledger, suggests that the notes can withstand
more future defaults than indicated by the current credit
enhancement. The Class A and B can still withstand 50%, and 45%
(as of the current outstanding portfolio balance) respectively of
additional defaults compared with their current CE of 42.9% and
37.2% while the class C and D can withstand 39% and 33%
respectively, compared with CE of 30.7% and 24.8%.
Fitch's default expectation over the remaining term is currently
25%. This includes default events at scheduled maturity due to
refinancing risk arising from the underlying security being bullet
loans. The agency expects all rated notes will receive timely
payment of interests and ultimate payment of principal.
Fitch deems the overall portfolio quality to be in line with 'B'
and applied IKB's internal ratings to determine a credit quality
distribution around that mean. For four companies, which account
for 7.5% of the portfolio amount, Fitch further lowered the
expected survival prospects as, in the agency's opinion, the
available latest IKB internal ratings did not fully reflect the
current financial situation of those companies. The adjustments
were based on investor report information and information provided
by EquiNotes regarding refinancing prospects, the latest
developments of critical portfolio companies and likely loss
participations over the next 12 months.
Furthermore, increased default probabilities have been assumed for
those instruments that feature loss participations. Currently,
two obligors have exercised the loss participation option. One
agreement exhibits strong equity characteristics and has been
treated as equity by Fitch for the purpose of this review, in line
with the analysis at closing.
Currently the portfolio contains 46 obligors (initially 57
obligors). The largest exposure accounts for 4.8% of the
portfolio and the top five obligors for 24%. The classes A, B C
and D, can, in Fitch's opinion, withstand the default of the top
12, 11, nine and seven obligors, respectively. As all securitized
debt instruments are subordinated, Fitch assumes no recovery in
its analysis.
Fitch has assigned an Issuer Report Grade of three stars
("satisfactory") to the publicly available reports on the
transaction. The reporting is accurate and timely. Principal
deficiency levels are displayed. The reports contain obligor by
obligor information and comment on obligors, which are on watch
list. However, the reports lack region and industry
stratifications, counterparty trigger information and coupon
stratifications.
FORCE TWO: Fitch Junks Rating on Class C Notes From 'B'
-------------------------------------------------------
Fitch Ratings has downgraded FORCE TWO Limited Partnership's Class
A, B and C notes, following continuing defaults during the past 12
months. The downgraded notes face increasing vulnerability to
additional defaults during the remaining term of 3.75 years and
refinancing risk at scheduled maturity. The Loss Severity Ratings
have been revised due to higher loss expectations.
The transaction is a cash securitization of subordinated debt and
loss participation agreements of German SMEs. The portfolio
companies were selected by equiNotes Management GmbH, a joint
venture of IKB Deutsche Industriebank Aktiengesellschaft and
Deutsche Bank Aktiengesellschaft, acting as advisor for the
issuer.
-- EUR137.9m Class A notes (ISIN: XS0299041037): downgraded to
'B' from 'BB', Outlook Negative, 'Loss Severity Rating revised
to 'LS-3' from 'LS-1'
-- EUR12.3m Class B notes (ISIN: XS0299041896): downgraded to
'B-' from 'B+', Outlook Negative, Loss Severity Rating revised
to 'LS-5' from 'LS-4'
-- EUR13m Class C notes (ISIN: XS0299042357): downgraded to 'CCC'
from 'B'
-- EUR11.9m Class D notes (ISIN: XS0299044056): affirmed at 'CCC'
-- EUR9.7m Class E notes (ISIN: XS0299045020): affirmed at 'CC'
Since closing in 2007, there have been four default events,
amounting to EUR17 million and or 7.9% of the initial portfolio;
of this, 4.2% occurred during the last 12 months. An additional
company incurred a loss participation, which, though, has by now
been reinstated.
Compared to FORCE 2005-1, the FORCE TWO has substantially lower
credit enhancements, currently 31.7%, 25.6%, 19.2%, 13.4% and 8.6%
for Class A, B, C, D and E, respectively. Also, the ability to
trap excess spread via the principal deficiency ledger (PDL) is
weaker, estimated to be roughly 5.2% over the term of the
transaction under Fitch's base scenario. The current PDL is
outstanding at EUR4.7 million or 2.3%. The notes can withstand
defaults of 30.2%, 24.9%, 19.3%, 14.1% and 9.9% (hurdle rates),
respectively.
Fitch's default expectation over the remaining term of 3.75 years
is currently 20%. This includes default events at scheduled
maturity due to refinancing risk arising from the underlying
security being bullet loans.
Fitch deems the overall portfolio quality to be in line with 'B'
and applied IKB internal ratings to determine a credit quality
distribution around that mean. For five companies, which account
for 14.5% of the portfolio amount, Fitch further lowered the
expected survival prospects as, in the agency's opinion, the
available latest IKB internal ratings did not fully reflect the
current financial situation of those companies. The adjustments
were based on investor report information and information provided
by EquiNotes regarding refinancing prospects, the latest
developments of critical portfolio companies and likely loss
participations over the next 12 months.
Furthermore, increased default probabilities have been assumed for
those instruments that feature loss participations, though, unlike
FORCE 2005-1, only a minority of the instruments feature loss
participations. This contributes to a lower default expectation
compared with FORCE 2005-1. Currently, no obligor has exercised
the loss participation option.
Currently the portfolio contains 44 obligors (initially 48
obligors). The largest exposure accounts for 6.3% of the
portfolio and the top five obligors for 25.8%. The class A, B C,
and D can, in Fitch's opinion, withstand the default of the top
six, four, three, and two obligors, while the class E can only
absorb the default of the largest obligor, resulting in
substantial single-obligor concentration risk. As all securitized
debt instruments are subordinated, Fitch assumes no recovery in
its analysis.
In Fitch's opinion a default of the class C note is possible, as
the hurdle rate (19.3%) is close to Fitch's default expectation
for the remaining term. As a result, the class C note has been
downgraded to 'CCC'.
Fitch has assigned an Issuer Report Grade of three stars
("satisfactory") to the publicly available reports on the
transaction. The reporting is accurate and timely. Principal
deficiency levels are displayed. The reports contain obligor by
obligor information and comment on obligors, which are on watch
list. However, the reports lack region and industry
stratifications, counterparty trigger information and coupon
stratifications.
=============
I R E L A N D
=============
KILLESHIN HOTEL: In Receivership; Owes EUR20MM to Creditor Bank
---------------------------------------------------------------
Ciaran Hancock at The Irish Times reports that Killeshin Hotel has
been placed into receivership.
The report relates Gearoid Costello, a Limerick-based partner with
Grant Thornton, has been appointed as receiver to the business by
Anglo Irish Bank, which is believed to be owed about EUR20
million.
It is understood that Pembroke Hospitality, which is led by former
Jury Doyle executive Niall Geoghegan and backed by DTZ Sherry
Fitzgerald, has been appointed to manage the four-star hotel,
which will remain open and will trade as a going concern, the
report notes.
According to the report, as with other hotels in the midlands, the
Killeshin has taken a major hit in the recession.
The Killeshin Hotel is located on the edge of Portlaoise, Co
Laois.
QUINN INSURANCE: Gets 900 Applications for Voluntary Redundancy
---------------------------------------------------------------
Ciaran Hancock at The Irish Times reports that Quinn Insurance's
administrators, Michael McAteer and Paul McCann of Grant Thornton,
are believed to have received more than the 900 applications for
voluntary redundancy that they were seeking from staff by Monday's
5:00 p.m. deadline.
The report relates the administrators on Monday night began
processing the applications to see how many will qualify for the
redundancy package that they put on the table.
The report recalls on April 30, the administrators announced their
intention to make 900 staff redundant at Quinn Insurance to help
restore the business to profitability. This represented 37% of
the company's 2,450-strong workforce, the report notes. The
report relates the administrators said the job cuts would be
implemented over a 15-month period up to mid-2011. The job losses
are targeted to achieve savings of EUR30 million annually, the
reports says.
As reported by the Troubled Company Reporter-Europe on April 19,
2010, The Financial Times said Quinn Insurance was put into
administration on April 15 after Sean Quinn abandoned attempts to
keep control of the family-owned company.
Quinn Insurance is owned by Sean Quinn, Ireland's richest man, and
his family. The company has just more than 20% of the motor and
health insurance market in Ireland. It has more than one million
customers in the country. Employing almost 2,800 people in
Britain and Ireland, it was founded in 1996 and entered the UK
market in 2004, according to The Times.
===========
R U S S I A
===========
FOREIGN ECONOMIC: S&P Gives Positive Outlook; Keeps 'B-' Rating
---------------------------------------------------------------
Standard & Poor's Ratings Services said it revised its outlook on
Russia-based Foreign Economic Industrial Bank (Vneshprombank) to
positive from stable. At the same time, the 'B-' long-term and
'C' short-term counterparty credit ratings were affirmed. The
Russia national scale rating was raised to 'ruBBB' from 'ruBBB-'.
"The outlook revision reflects S&P's view that Vneshprombank has
shown positive commercial dynamics through the substantial
increase of its customer franchise and its sound financial
performance," said Standard & Poor's credit analyst Maria
Malyukova. "Despite rapid lending growth, the bank has
demonstrated good asset quality indicators that are better than
system average; a continually high proportion of liquid assets;
and healthy bottom-line results."
The ratings are constrained by S&P's concerns about
Vneshprombank's relatively aggressive growth, high concentration
of single large depositors, and the currently challenging, albeit
stabilizing, operating environment in Russia.
The ratings reflect the bank's stand-alone credit profile and do
not include any uplift for extraordinary external support, either
from the owners or the government. Vneshprombank is owned by a
number of legal entities and private individuals. The largest
stakes belong to the bank's CEO, Larissa Markus (19.7%); Alexander
Zurabov (15.8%); insurance company Prominstrakh (8.7%); one of
Russia's leading auto transportation enterprises, Sovtransavto
(8.4%); and construction company Promstroyproject (7.7%). The
shareholders' personal connections are helping the bank to develop
its customer franchise.
Vneshprombank boosted its balance sheet almost twofold in 2009,
resulting in total assets of Russian ruble (RUB) 47 billion (about
US$1.5 billion) as of Dec. 31, 2009, and now ranks No. 71 among
Russia's banks. A substantial increase in corporate customers to
880 by year-end 2009 from 548 in 2008 supported the bank's growth
and included the attraction of the largest crude oil pipeline
operator in Russia. Headquartered in Moscow, Vneshprombank is
continuing its regional branch network expansion, aiming to become
one of the top 50 banks in Russia by 2011.
The bank's capitalization is under pressure because of the
extensive asset growth. The ratio of adjusted total equity to
total assets declined to 6.2% as of Dec 31, 2009. However, S&P
regard shareholder support through capital injections, including a
RUB290 million capital increase in May 2010, as a positive factor.
"The outlook is positive because S&P expects Vneshprombank to
continue enhancing its franchise through further business growth,
while preserving its current financial profile and, in particular,
its asset quality metrics and funding profile, despite the high
depositor concentrations," said Ms. Malyukova. "The outlook also
factors in S&P's assumption that the shareholders will continue to
support growth through further capital injections if required."
The ratings could be raised if Vneshprombank is successful in
maintaining its asset quality and capitalization at good levels
amid further planned asset growth and if S&P sees that it is
reducing the high funding concentrations.
S&P would consider a negative rating action if Vneshprombank's
funding and liquidity profile were to deteriorate in the quest for
rapid lending growth, if the shareholders were to stop supporting
the bank's capitalization, or if asset quality were to weaken more
than S&P currently anticipates.
GLAVMOSSTROY OAO: Moscow Court Ends Bankruptcy Proceedings
----------------------------------------------------------
RMG Research reports that a Moscow arbitrage court on Monday
ceased bankruptcy proceedings against Glavmosstroy.
RMG recalls Alfa Bank and other company's creditors initiated
bankruptcy proceedings in 2009.
According to RMG, the trial has been stopped since the parties
reached prejudicial agreement on debt restructuring.
As reported by the Troubled Company Reporter-Europe on July 2,
2009, Reuters said Alfa filed claims for a total of RUR1 billion
(US$32.23 million) against Glavmosstroy, part of Oleg Deripaska's
bigger GlavStroy construction conglomerate, since the beginning of
2009. Reuters disclosed a unit of steel maker MMK and GlavStroy's
former unit Strom Holding, were also seeking to place Glavmosstroy
in bankruptcy.
Kholdingovaya kompaniya Glavmosstroy OAO (Open Joint Stock Holding
Company Glavmosstroy) -- http://www.glavmosstroy.ru/-- is a
Russia-based holding company, which main areas of activity are
construction trade and investment operations. The Company
specializes in the construction of apartment houses and complexes,
reconstruction of historical buildings and apartment houses,
erection of children's preschool establishments, schools, and
grammar schools under typical and individual projects and objects
of public health services. The Company is active on the territory
of Moscow and the Moscow Region. It operates through numerous
subsidiaries and affiliated companies.
SOGAZ OJSC: S&P Raises Counterparty Credit Rating to 'BB+'
----------------------------------------------------------
Standard & Poor's Ratings Services said that it had raised its
long-term counterparty credit and insurer financial strength
ratings on Russia-based insurer OJSC Sogaz to 'BB+' from 'BB'.
The outlook is stable. At the same time, S&P raised its Russia
national scale rating to 'ruAA+' from 'ruAA'.
"The upgrade reflects improvements in Sogaz's competitive
position, a sustained good operating performance, the improved
quality and diversification of its investments, and improving
capitalization levels, despite the still-challenging economic and
operating environment in Russia," said Standard & Poor's credit
analyst Victor Nikolskiy.
The ratings reflect Sogaz's good operating performance and
competitive position, and adequate capitalization levels. The
ratings also reflect the ongoing support and S&P's assessment of
probability of extraordinary support from OAO Gazprom
(BBB/Negative/A-3), the world's largest natural gas company, with
which Sogaz has strong ties.
These positive factors are offset by the relatively high credit
risk in Sogaz's investment portfolio, which is now one of the
limiting factors for the rating, and the high industry risk
associated with operating in the Russian insurance market.
Concentration of Sogaz's investments in related companies has
gradually diminished, but S&P believes it could return.
"The stable outlook reflects S&P's expectation that Sogaz will
continue its strong relationship with Gazprom and its good
operating performance," said Mr. Nikolskiy.
S&P expects Sogaz to maintain its currently adequate risk-based
capital and at least marginal quality of investment portfolio.
In S&P's view, Sogaz's insurance portfolio diversity will improve,
but Gazprom will remain its largest client.
A positive rating action could result if the quality of the
company's investments improves significantly, and S&P's assessment
of its exposure arising from industry and county risk lessens, all
other factors being equal.
Conversely, any significant and sustained deterioration in
earnings, capitalization, or the quality of the company's
investment portfolio could lead to a negative rating action.
Negative rating actions could also follow if S&P recognizes a
diminution of Gazprom support.
ZLATOUST METALLURGICAL: Mechel May Acquire Chelyabinsk Facility
---------------------------------------------------------------
Ilya Khrennikov at Bloomberg News reports that OAO Mechel may
acquire OAO Zlatoust Metallurgical Works in Chelyabinsk region
after signing a supply agreement with the plant in 2009.
According Ekaterina Videman, a spokeswoman for Mechel said the
Moscow-based company is interested in buying the facility. She
declined to comment on possible timing, saying it will depend on
market conditions, Bloomberg notes.
Bloomberg recalls Mechel agreed in August to supply Zlatoust with
semi-finished steel and to sell its products. Zlatoust filed for
bankruptcy protection in June, Bloomberg recounts.
=========
S P A I N
=========
BODYBELL: Lenders Ask Owners to Inject More Cash
------------------------------------------------
Martin Arnold at The Financial Times reports that Bodybell's
lenders have asked the company's owners, Spanish private equity
groups Mercapital and N+1, to inject more cash into the business
as part of a debt restructuring, its second in as many years.
Bodybell is a perfume retailer. It has 240 outlets in Spain
employing 1,900 people, according to the FT.
CORTEFIEL: Investors Inject New Capital to Reset Loan Terms
-----------------------------------------------------------
Martin Arnold at The Financial Times reports that Permira, PAI and
CVC recently injected about EUR20 million each into Cortefiel to
reset the terms of its loans.
Cortefiel is a Spanish department store chain.
LEVANTINA: Debt-for-Equity Swap Deal Gives Lenders Control
----------------------------------------------------------
Martin Arnold at The Financial Times reports that Levantina's
lenders, led by France's BNP Paribas, have taken control by
swapping some of their loans for stakes in the company after it
breached the terms of its debt covenants.
According to the FT, Charterhouse and Impala have kept a stake of
about 18%.
Levantina, the FT says, has been hit hard by the economic
downturn, particularly by the housing market slump in the US and
Spain, two of its biggest markets.
Levantina is a maker of marble tiles and granite kitchen worktops.
It was bought for EUR540 million (US$680 million) by Charterhouse
Capital of the UK and Impala of Spain four years ago, according to
the FT.
PANRICO: Final Bids Due by June 30
----------------------------------
Final bids for Panrico are due by the end of June, Marietta Cauchi
at Dow Jones Newswires reports, citing a person familiar with the
situation.
Dow Jones relates plans for a restructuring by the company's 40 or
so lending banks were recently abandoned and a sale process was
launched. According to Dow Jones, the people said Permira and PAI
Partners are among the bidders.
Dow Jones recalls Panrico was bought by London-based buyout firm
Apax Partners in 2005 in a leveraged deal reportedly worth EUR900
million.
Dow Jones says the company has been severely hit by the Spanish
downturn, which has seen consumers shifting to cheaper generic
brands sold in supermarkets.
Martin Arnold at the Financial Times reports that as part of
negotiations between Apax and the holders of Panrico's EUR600
million of debts, the company appointed Credit Suisse to examine a
potential sale. According to the FT, people familiar with the
situation said the auction could be dropped if Apax agrees to
inject enough money into the company to convince the banks to
reset its covenants.
Based in Spain, Panrico makes branded pastries and sliced bread
and is best known for its Donuts brand.
* SPAIN: Four Savings Banks Submit Merger Proposal
---------------------------------------------------
Ben Sills and Charles Penty at Bloomberg News report that four
Spanish savings banks plan to combine to form the nation's fifth-
largest financial group with more than EUR135 billion (US$167
billion) in assets.
Bloomberg relates Caja de Ahorros del Mediterraneo, Grupo
Cajastur, Caja de Ahorros de Santander y Cantabria and Caja de
Ahorros y Monte de Piedad de Extremadura said in a filing Monday
that they submitted a proposal to Spain's central bank to pool
their businesses. Bloomberg notes Caja de Mediterraneo, citing
figures from the end of last year, said in a separate e-mailed
statement that the four-way merged group will have a solvency
ratio of 12.1% and Tier 1 capital of 9.4%.
According to Bloomberg, the Bank of Spain is urging mergers for
the regional "cajas," mutually owned banks that boosted lending
more than fivefold during Spain's 10-year housing boom and account
for about half the country's loans. Bloomberg says Spain is
seeking to shore up the lenders as the nation's sputtering economy
and widening budget deficit, forecast at 9.3% of gross domestic
product this year, drive away investors.
"Many of them are half bankrupt," Bloomberg quoted Rafael
Pampillon, head of economic analysis at the IE Business School in
Madrid, as saying in an interview, not referring specifically to
the four that are combining. "They have loans to property
developers and mortgages that have turned toxic, and by mixing
them with other savings banks the risk is diluted."
Bloomberg notes Finance Minister Elena Salgado said Monday that
more savings banks would merge in coming weeks, and urged regional
governments, which appoint directors to many cajas' boards, not to
delay transactions for political reasons.
Separately, Bloomberg News' Mr. Penty reports that in the rush to
fix its struggling savings banks, Spain risks leaving the job half
finished.
"It's a halfway house that creates some savings but not enough,"
Bloomberg quoted Inigo Lecubarri, who manages about US$170 million
at Abaco Financials Fund in London, as saying. "If you're going
to do these mergers, you should aim to cut costs."
Bloomberg says by melding ailing lenders with stronger partners,
the central bank aims to purge bad loans and lay the groundwork
for economic recovery as the government tackles its budget
deficit. Mr. Lecubarri, as cited by Bloomberg, said lumping
lenders together without reducing staff and closing branches isn't
likely to accomplish those aims.
According to Bloomberg, the four-way combination would create the
fifth-biggest banking group in Spain by assets, with 2,300 offices
and 14,000 employees. The cajas chose to be required to monitor
solvency and liquidity centrally, under a single management,
Bloomberg discloses. Their brands, local branch networks and
spending on social programs would remain independent, Bloomberg
notes.
Restructuring
Bloomberg says the deal, which would involve an injection of cash
from the rescue fund, hasn't been signed off by regulators.
According to Bloomberg, to tap the fund, the banks may have to
agree to additional restructuring measures.
The Bank of Spain has approved the model for such mergers, dubbed
"cold fusions" by the Spanish press, Bloomberg states.
Victor Mallet at The Financial Times reports that the Bank of
Spain said any request for public money from the Frob -- Spain's
new bank restructuring fund -- would be granted only in exchange
for restructuring and deep cost cuts by the cajas concerned.
The FT says many of the 45 Spanish savings banks are struggling
with high levels of bad loans after the collapse of the domestic
housing market and nearly two years of economic recession prompted
by the global crisis.
=============
U K R A I N E
=============
NAFTOGAZ UKRAINY: No Bankruptcy Threat, Ukrainian Minister Says
---------------------------------------------------------------
BBC, citing Ukrayinska Pravda, reports that Ukrainian Fuel and
Energy Minister Yuriy Boyko has said there will be no absorption
of Naftogaz Ukrainy or its bankruptcy.
According to BBC, Mr. Boyko said that any cooperation with the
Russian partners would only be on a parity basis and in line with
the Ukrainian interests.
BBC notes Mr. Boyko, as cited by Ukrayinska Pravda, said: "We had
a difficult situation indeed. . . . Of course, there are certain
problems. But there are no problems that would jeopardize
Naftohaz or our country."
As reported by the Troubled Company Reporter-Europe, Bloomberg
News said Naftogaz was forced to reschedule payments on US$500
million of loan participation notes and US$1.15 billion of
outstanding loans last year after running out of cash as prices of
Russian imported gas jumped. Bloomberg disclosed Russia, which
supplies almost 50% of Ukraine's energy needs, agreed on April 21
to cut the price by 30% this year.
About NJSC Naftogaz of Ukraine
Headquartered in Kiev, Ukraine, NJSC Naftogaz of Ukraine --
http://www.naftogaz.com/-- is a vertically integrated oil and gas
company engaged in full cycle of operations in gas and oil field
exploration and development, production and exploratory drilling,
gas and oil transport and storage, supply of natural gas and LPG
to consumers.
* * *
As reported by the Troubled Company Reporter-Europe on Nov. 18,
2009, Fitch Ratings affirmed NJSC Naftogaz of Ukraines' long-term
foreign currency and local currency issuer default ratings at
'CCC'. Fitch said the outlook is negative.
UKRAINIAN FOOD: Declared Bankrupt; Court Initiates Liquidation
--------------------------------------------------------------
Interfax Ukraine reports that Kyiv's economic court has declared
Ukrainian Food Company Ltd. bankrupt and launched its liquidation.
According to the report, arbitration manager Viktor Osypchuk was
appointed liquidator of the company.
Kyiv-based Ukrainian Food Company Ltd. was once one of the largest
sugar producers in Ukraine.
===========================
U N I T E D K I N G D O M
===========================
AEOLUS CDO: S&P Junks Ratings on Five Classes of Notes
------------------------------------------------------
Standard & Poor's Ratings Services lowered and removed from
CreditWatch negative its credit ratings on three of Aeolus CDO
Ltd.'s CDO transactions.
The affected notes are:
* Aeolus CDO Ltd.'s (Colonnade I) class A to E notes;
* Aeolus CDO Ltd.'s (Colonnade II) class A to E notes; and
* Aeolus CDO Ltd.'s (Colonnade III) class A to E notes and the
class W combination notes.
The rating actions follow S&P's assessment of a deterioration,
since S&P's last review in June 2009, in the credit quality of the
portfolio of assets referenced through the credit default swap.
According to S&P's analysis, the percentage of assets rated below
investment-grade (below 'BBB-') is currently about 72% for
Colonnade I, 70% for Colonnade II, and 63% for Colonnade III.
Since S&P's last rating action in June 2009, this represents an
increase of 20%-40%.
These figures include adjustments to the ratings on those assets
that are currently on CreditWatch negative by at least three
notches, in line with S&P's criteria on "Revised Assumptions For
Structured Finance Assets With Ratings On CreditWatch And Held
Within CDO Transactions," published on April 6, 2009.
Of the assets rated below investment-grade, those rated 'CCC+' and
below account for about 17% in Colonnade I, 12% in Colonnade II,
and 9% in Colonnade III. Under the terms of the credit default
swap, a credit event is triggered once an asset is downgraded to
"CC". Other credit events related to the assets included in the
reference portfolio include bankruptcy, failure to pay interest,
failure to pay principal, a loss event, and the deferral of
interest for a certain number of consecutive months.
From the latest available trustee reports as of March 2010, S&P
notes that one credit event has been called regarding a
EUR7.2 million asset referenced in the Colonnade III portfolio.
The workout procedure is not completed yet. The issuer makes cash
settlement payments by liquidating a corresponding portion of the
underlying assets, constituting the note proceeds currently held
in Morgan Stanley Funds and rated 'AAAm', thereby reducing the
amount available for repayment of the notes.
As per the latest available trustee report of March 2010, each
of the three transactions is breaching all of its
overcollateralization ratio tests. According to the transaction
documents, a breach of the overcollateralization test requires the
portfolio administrator to use available interest and principal
proceeds after payment of senior expenses and interest on the
class A and B notes to reduce the size of the liabilities in order
of their seniority (starting with the super senior swap). The
class C, D, and E notes of all three transactions are deferring
their interest payments.
S&P also notes that, according to the transaction documents, a
termination of the CDS occurs if the class A overcollateralization
ratio is 100% or lower. A termination of the CDS agreement in
turn constitutes a mandatory note redemption event. According to
the information S&P has received from Morgan Stanley, the results
of this test are currently 105.4% for Colonnade I, 111.6% for
Colonnade II, and 101.8% for Colonnade III.
As a result of these developments, the existing ratings on all the
notes in Colonnade I, II, and III are in S&P's opinion no longer
commensurate with the available credit enhancement, and S&P has
therefore lowered the ratings on these notes.
Ratings List
Ratings Lowered and Removed From Creditwatch Negative
Aeolus CDO Ltd.
EUR126 Million Secured Credit-Linked Floating-Rate Notes
(Colonnade I)
Rating
------
Class To From
----- -- ----
A BBB- AAA/Watch Neg
B BB AA/Watch Neg
C B A/Watch Neg
D CCC- BBB-/Watch Neg
E CCC- BB-/Watch Neg
Aeolus CDO Ltd.
GBP89 Million Secured Credit-Linked Floating-Rate Notes
(Colonnade II)
Rating
------
Class To From
----- -- ----
A BBB+ AAA/Watch Neg
B BBB AA/Watch Neg
C BB+ BBB+/Watch Neg
D CCC+ BB-/Watch Neg
E CCC- CCC+/Watch Neg
Aeolus CDO Ltd.
EUR165.5 Million Secured Credit-Linked Floating-Rate Notes
(Colonnade III)
Rating
------
Class To From
----- -- ----
A BB+ AA+/Watch Neg
B BB- A+/Watch Neg
C B- BBB+/Watch Neg
D CCC BB/Watch Neg
E CCC- CCC+/Watch Neg
W CCC- BB/Watch Neg
ANTLER LUGGAGE: Sale to Lloyds Raises Conflict of Interest Queries
------------------------------------------------------------------
Helia Ebrahimi at The Daily Telegraph reports that the sale of
Antler to the private equity arm of Lloyds Banking Group has
raised questions about potential conflicts of interests. Lloyds,
the report notes, was also the business' main lender.
The report relates Antler was sold to Lloyds Development Capital,
the bank's buy-out division, last week as part of a pre-pack
administration.
According to the report, Michael Fallon, the senior Conservative
MP who is tipped to chair the Treasury Select Committee, said
there appeared to be a potential conflict of interest that needed
to be examined further. "This is a state-owned bank and we are
concerned about the amount of debt it is converting into equity.
I did ask Eric Daniels [Lloyds chief executive] this question at
the Treasury Select Committee meeting in January but he did not
have a clear answer," the report quoted Mr. Fallon as saying.
According to the report, a spokesman for Lloyds Banking Group
vehemently denied any potential conflict. "The decision to appoint
an administrator is for the relevant company alone. The
administrator, on behalf of the company, is then responsible for
ensuring the most attractive and sustainable bid is obtained
during the sale process," the spokesman, as cited in the report,
said. "This demarcation is clearly understood and was closely
observed by Lloyds Banking Group and LDC. There is simply no
conflict of interest and we strongly refute any suggestion to the
contrary."
The report states Antler incurred a GBP18.4 million loss in the
year ending December 2008 following a GBP17.4 million goodwill
writedown for the suitcase company bought just six years ago for
GBP44 million. The report notes accountants warned that although
the business was a "going concern" the writedown and pressure on
trading meant that lending terms could be breached if they were
not re-negotiated or extended. Antler's board, which formally
appointed KPMG as administrator, felt that there was no option but
to sell the business after its lending banks -- led by Lloyds --
refused to extend the terms of its borrowing, the report recounts.
Antler is a luggage company based in the United Kingdom.
BRITISH AIRWAYS: To Challenge Legality of Cabin Crew Strikes
------------------------------------------------------------
Pilita Clark at The Financial Times reports that British Airways
has warned the Unite union that it plans to keep challenging the
legality of the cabin crew walkouts that have cost it GBP43
million (US$62 million) so far.
The FT relates the airline's lawyers have written to the union
reminding them to keep all relevant paperwork from last week's
court action in which BA won an injunction halting strikes, only
to have it quashed by the Court of Appeal.
According to the FT, there was little sign of formal discussions
between the sides on Tuesday, though talks are likely to take
place before the next round of walkouts, due to start on Sunday.
The FT notes BA said in a statement the move was no more than
"standard legal procedure for all pending court cases", and
Unite's lawyers would have been fully aware of it. It said it was
not fighting the appeal court's decision, but continuing to work
on the original challenge, which was not settled by last week's
legal moves, the FT discloses.
Strike Costs
Separately, Steven Rothwell at Bloomberg News reports that a study
shows BA's cabin-crew strike may cost the carrier GBP1.4 billion
(US$2 billion) in lost sales as travelers defect to rivals.
Revenue typically drops as much as 18% in the year after consumers
suffer a negative experience with a service or product, Bloomberg
says, citing researchers at Manchester Business School who
surveyed 4,300 customers and employees of 56 businesses.
Injunction
As reported by the Troubled Company Reporter-Europe on May 24,
2010, The Times said Court of Appeal overturned an injunction that
was blocking a BA cabin crew strike. The Times disclosed the
Unite union said that cabin crew would stop work for five days
from May 24, with further five-day walkouts due to start on May 30
and June 5. According to The Times, the Appeal Court judges who
overturned the injunction said that the dispute could be settled
only through negotiation.
On May 19, 2010, the Troubled Company Reporter-Europe, citing
Times Online, reported that BA was granted an injunction to stop
the Unite union from carrying out cabin crew strikes that had been
due to start on May 17. Times Online disclosed the High Court
found that the union failed to comply with the legal requirement
to "send everyone eligible to vote details of the exact breakdown
of the ballot result".
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 March 19,
2010, Moody's Investors Service lowered to B1 from Ba3 the
Corporate Family and Probability of Default Ratings of British
Airways plc; and the senior unsecured and subordinate ratings to
B2 and B3, respectively. Moody's said the outlook is stable.
This concludes the review that was initiated on November 10, 2009.
The rating action reflects Moody's view that credit metrics will
not be commensurate with the previous rating category in the
medium term. Moody's expect furthermore that metrics will be
burdened in the foreseeable future by the company's significant
pension deficit, which was at GBP2.6 billion for the APS and NAPS
schemes combined as of September 2009 (under IAS). Moody's
nevertheless understand that under the current agreement with the
trade unions, the cash contributions to these deficits will be
frozen at GBP330 million per year for three years, subject to
approval by the Pensions Regulator and the trustees
BROOKLANDS HEALTH: Goes Into Administration
-------------------------------------------
James Graham at The Business Desk reports that Brooklands Health
Farm has gone into administration.
The report relates Simon Wilson, Kevin Coates and Anne O'Keefe of
Zolfo Cooper were appointed joint administrators of the company on
May 19.
Lancashire-based Brooklands Health Farm operates Brooklands
Retreat, a health spa on the edge of the Forest of Bowland, near
Preston.
PRIME TIME: Silver Strawberry Buys Firm for More Than GBP1 Mil.
---------------------------------------------------------------
The Scotsman reports that Silver Strawberry has bought the
business and assets of Prime Time Nursery for more than GBP1
million.
The report recalls the Court of Session appointed Matt Henderson
of Johnston Carmichael, the chartered accountant and business
adviser, as liquidator of Prime Time in September. Since then,
the nursery has been run under license while seeking a buyer, the
report recounts.
According to the report, Allied Irish Bank funded the Silver
Strawberry venture.
Prime Time Nursery is based in Edinburgh, Scotland.
* UNITED KINGDOM: GBP55BB Comm. Property Loans Await Refinancing
----------------------------------------------------------------
Sinead Cruise at Reuters reports that about one-quarter of
Britain's GBP228 billion commercial real estate debt pile needs to
be refinanced in 2010.
According to Reuters, the UK Commercial Property Lending Market
survey by De Montfort University showed GBP55 billion (US$78.4
billion) of loans and debt-backed securities are due to mature by
Dec. 31, in the first of five testing years during which 71% of
outstanding mortgages fall due for repayment.
Defaults
Reuters relates the study, which polled 68 lenders active in the
UK commercial property market, showed the total value of
commercial property loans in default rose by more than 500% to
GBP19.3 billion at end-2009, from GBP3 billion at end-2008.
Reuters says a further GBP28.3 billion of mortgages were in breach
of their covenants, bringing the total number of distressed
commercial property loans to GBP47.6 billion, or a fifth of the
total UK loan book.
===============
X X X X X X X X
===============
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Aug. 2-4, 2012
AMERICAN BANKRUPTCY INSTITUTE
Mid-Atlantic Bankruptcy Workshop
Hyatt Regency Chesapeake Bay, Cambridge, Md.
Contact: 1-703-739-0800; http://www.abiworld.org/
Nov. 29 - Dec. 2, 2012
AMERICAN BANKRUPTCY INSTITUTE
Winter Leadership Conference
JW Marriott Starr Pass Resort & Spa, Tucson, Ariz.
Contact: 1-703-739-0800; http://www.abiworld.org/
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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.
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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. Joy A. Agravante, Valerie U. Pascual, Marites O.
Claro, Rousel Elaine T. Fernandez, Frauline S. Abangan 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.
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