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/raid1/www/Hosts/bankrupt/TCREUR_Public/101230.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, December 30, 2010, Vol. 11, No. 261 Headlines A U S T R I A HYPO ALPE: Ex-Croatian Prime Minister Denies Accepting Kickbacks F R A N C E BELVEDERE SA: CEO Asks Regulator to Investigate Stock Movements I R E L A N D ALLIED IRISH: Faces EUR2MM Fine for Overcharging Customers ANGLO IRISH: Ex-Chief Drumm Spends EUR10,000 to Run Luxury Homes ERC IRELAND: Moody's Reviews 'Caa1' Corporate Family Rating TBS INTERNATIONAL: Lenders Extend Forbearance Until Jan. 31 U N I T E D K I N G D O M BLADE TOOLING: Staff Awaits Fate Following Administration INEOS GROUP: Mulls Joint Ventures with Companies in Asia LEHMAN BROTHERS: European Unit Loses Suits Over 5 Swap Agreements PONTIN'S: Gets Offers From Potential Buyers, Administrators Say ROYAL BANK: British Investors Mull Class Action in UK Courts ROYAL BANK: Charged Less APS Fee by Government, NAO Report Shows WHITEHAVEN RLFC: Copeland Council to Repay GBP75,000 Loan X X X X X X X X * Upcoming Meetings, Conferences and Seminars ********* ============= A U S T R I A ============= HYPO ALPE: Ex-Croatian Prime Minister Denies Accepting Kickbacks ---------------------------------------------------------------- Gordana Seler at Reuters reports that former Croatian Prime Minister Ivo Sanader on Dec. 22 denied allegations he accepted kickbacks from Hypo Alpe Adria bank, which was nationalized after suffering serious losses in the Balkans. Mr. Sanader, arrested in Austria earlier this month on a Croatian warrant in a different case, testified to an inquiry by the regional parliament in Austria's Carinthia state into the failure of Hypo Alpe Adria bank, Reuters relates. "I have a clear conscience with regard to Hypo. I never received any money or commissions," Mr. Sanader said via video link to the hearing from Salzburg, where he was being held, according to Reuters. Croatian prosecutors suspect Mr. Sanader of being behind a plan to create slush funds for his conservative HDZ party during his term as prime minister from 2004 to 2009, Reuters discloses. Former Hypo chief executive Wolfgang Kulterer, who is awaiting trial on charges of illegally diverting bank funds, has also denied that the bank paid Mr. Sanader any commission, Reuters notes. Probe As reported by the Troubled Company Reporter-Europe, the European Commission on Tuesday, May 12, 2009, opened under EC Treaty state aid rules an in-depth investigation into state support measures for German Landesbank BayernLB and its Austrian subsidiary Hypo Group Alpe Adria (HGAA). BayernLB obtained rescue aid in the form of a capital injection of EUR10 billion and a risk shield of EUR4.8 billion, endorsed by the Commission on December 18, 2008. Also in December 2008 HGAA received EUR0.7 billion capital injection from BayernLB. In addition, HGAA received a EUR0.9 billion capital injection from Austria on the basis of the Austrian banking emergency rescue scheme, approved by the Commission in December 2008. Hypo Alpe-Adria International AG is a subsidiary of BayernLB. It is active in banking and leasing with a balance sheet of EUR43 billion. In banking, HGAA serves both corporate and retail customers and offers services ranging from traditional lending through savings and deposits to complex investment products and asset management services. * * * As reported by the Troubled Company Reporter-Europe on Aug. 5, 2010, Moody's Investors Service downgraded to Baa3 from Baa2 the long-term debt and deposit ratings of Hypo Alpe-Adria-Bank International AG and its ratings for subordinated liabilities to Ba1 from Baa3. Concurrently, the bank's short-term rating was downgraded to P-3. Hypo Alpe Adria's E Bank financial strength rating, mapping to a stand-alone Baseline Credit Assessment of Caa2, was affirmed with a stable outlook. The multi-notch uplift for the bank's deposit and debt ratings reflects Moody's assessment of a very high probability of ongoing systemic support. The outlook on the debt and deposit ratings is negative. Moody's decision to downgrade Hypo Alpe Adria's long-term debt ratings by only one notch follows the recent completion of another EUR450 million capital injection by the Republic of Austria and EUR150 million by the State of Carinthia, as announced in December 2009. Moody's said the E BFSR reflects Moody's view that, the recent capital injections notwithstanding, Hypo Alpe Adria is likely to continue to face substantial challenges in its efforts to rebuild some of its previous financial strength. =========== F R A N C E =========== BELVEDERE SA: CEO Asks Regulator to Investigate Stock Movements --------------------------------------------------------------- David Whitehouse at Bloomberg News, citing French daily La Tribune, reports that Belvedere SA Chief Executive Officer Jacques Rouvroy has written to France's AMF stock-market regulator seeking an investigation into movements in the company's stock. Bloomberg relates that Belvedere shares have almost doubled since the start of November and increased 18% on Dec. 23. According to Bloomberg, an unidentified AMF spokesman, as cited by La Tribune, said the letter had been received and declined to comment further. Recovery Plan As reported by the Troubled Company Reporter-Europe on Dec. 15, 2010, Bloomberg News said Belvedere made a preliminary payment to bondholders of EUR23 million (US$30.8 million) and postponed its sale of units including Marie Brizard and Polish distributors, which had been part of its court-approved bankruptcy recovery plan. Belvedere's recovery plan was approved in November 2009, detailing steps including asset sales, Bloomberg disclosed. The company bought Marie Brizard, whose brands include Old Lady's Gin and Tullamore Dew Whiskey, in 2005, in part by issuing Floating Rate Notes, according to Bloomberg. Bloomberg said Belvedere violated terms of the notes, which led it to file for court protection from creditors. Belvedere SA -- http://www.belvedere.fr/-- is a France-based company engaged in the production and distribution of beverages. The Company's range of products includes vodka and spirits, wines, and other beverages, under such brands as Sobieski, William Peel, Marie Brizard, Danzka and others. Belvedere SA operates through its subsidiaries, including Belvedere Czeska, Belvedere Scandinavia, Belvedere Baltic, Belvedere Capital Management, Sobieski SARL and Sobieski USA, among others. It is present in a number of countries, such as Poland, Lithuania, Bulgaria, Denmark, France, Spain, Russia, Ukraine, the United States and others. In addition, the Company holds a minority stake in Abbaye de Talloires, involved in the hotel and wellness center. ============= I R E L A N D ============= ALLIED IRISH: Faces EUR2MM Fine for Overcharging Customers ---------------------------------------------------------- Conor Pope at The Irish Times reports that Allied Irish Banks has been fined EUR2 million by the Central Bank -- the largest fine in Irish retail banking history -- after it was found to have overcharged significant numbers of its customers over a period of several years. According to The Irish Times, the bank also failed to introduce proper systems to notify them of the irregularities and to issue refunds on a timely basis. The Irish Times relates that the Central Bank said AIB had been in breach of the Consumer Protection Code, which outlines how all banks must deal with consumers, over several years, and had breached the code in three distinct ways. It found 258,000 customers had been overcharged an average of just under EUR100 each, The Irish Times discloses. There had been an unacceptable delay in notifying customers of the overcharging and in issuing refunds, according to The Irish Times. It said the bank did not have in place adequate systems and controls to ensure compliance with the code when it came to informing customers about refunds due, The Irish Times states. The Central Bank said the fine reflected the numbers of errors involved, the amount of money involved, and the number of consumers affected, The Irish Times notes. Capital Injection As reported by the Troubled Company Reporter-Europe on Dec. 29, 2010, The Financial Times said the Irish government took a further step towards complete ownership of Allied Irish Banks as it won court approval on Dec. 23 to inject EUR3.7 billion (US$4.85 billion) into the bank. Finance Minister Brian Lenihan said the capital injection from the country's National Pension Reserve Fund would effectively raise the government's stake to 92.8% in AIB early next year from the 18.6% it holds after last year's investment of EUR3.5 billion, according to the FT. Allied Irish Banks, p.l.c., together with its subsidiaries -- http://www.aibgroup.com/-- conducts retail and commercial banking business in Ireland. It also provides corporate lending and capital markets activities from its head office at Bankcentre and from Dublin's International Financial Services Centre. The Group also has overseas branches in the United States, Germany, France and Australia, among other locations. The business of AIB Group is conducted through four operating divisions: AIB Bank Republic of Ireland division, Capital Markets division, AIB Bank UK division, and Central & Eastern Europe division. In February 2008, the Group acquired the AmCredit mortgage business in the Baltic states of Latvia, Lithuania and Estonia. In September 2008, the Group also acquired a 49.99% shareholding in BACB. * * * As reported by the Troubled Company Reporter-Europe on Dec. 22, 2010, Standard & Poor's Ratings Services said that lowered its rating on Allied Irish Banks PLC's nondeferrable subordinated debt (lower Tier 2) securities to 'CCC' from 'B'. S&P said he 'BBB/A- 2' counterparty credit ratings on AIB remain on CreditWatch with negative implications where they were placed on Nov. 26, 2010. Issuance guaranteed by the Republic of Ireland (A/Watch Neg/A-1) is not affected by the rating action. "The downgrade reflects S&P's opinion that the likelihood of a liability management exercise by AIB in respect of its lower Tier 2 instruments has increased. If the bank announces an exchange offer, S&P would expect to characterize it as a "distressed exchange," said Standard & Poor's credit analyst Nigel Greenwood. ANGLO IRISH: Ex-Chief Drumm Spends EUR10,000 to Run Luxury Homes ---------------------------------------------------------------- Shane Phelan at Irish Independent reports that David Drumm, Anglo Irish Bank's former chief executive, is spending almost EUR10,000 a month running two luxury homes he no longer lives in. According to Irish Independent, US court records reveal the running costs of his mansions in Cape Cod, Massachusetts, and Malahide, Co Dublin, will come to EUR47,970 for the period between November this year and March of 2011. That works out at an average of EUR9,594 a month, Irish Independent says. The revelation came as a US bankruptcy trustee on Dec. 22 formally put the Cape Cod property on the market with an asking price of US$5.5 million (EUR4.2 million), Irish Independent relates. Half of the proceeds of the sale will go to Mr. Drumm's wife, Lorraine, Irish Independent relates discloses. Records filed as part of the bankruptcy process reveal a host of expenses being paid each month to maintain two mansions he co- owns, Irish Independent notes. According to The Irish Times, the expenses are being met despite the fact that Mr. Drumm no longer lives in either home and claims to have no funds. His mansion in Malahide, in the exclusive Abington estate, has average monthly running costs of around EUR1,500, according to Irish Independent. As part of a deal with bankruptcy trustee Kathleen Dwyer, these costs will now be met by Mr. Drumm's wife until at least April 30 next year, by which time it is hoped the Chatham mansion will have been sold, Irish Independent says. As reported by the Troubled Company Reporter-Europe on Dec. 23, 2010, Irish Independent said the High Court Dec. 21 formally overturned the transfer by former Mr. Drumm of his half-share in the former family home into the sole ownership of his wife. Irish Independent disclosed in court proceedings against Mr. Drumm and his wife Lorraine, Anglo had sought to overturn the May 2009 transfer of ownership of the property at Abington, Malahide, Co Dublin, arguing it was a fraud on creditors. The Drumms insisted it was for tax reasons, Irish Independent noted. Mr. Justice Peter Kelly made an order setting aside "ab initio" the May 2009 transfer of the property from the joint ownership of David and Lorraine Drumm into the sole name of Mrs. Drumm, according to Irish Independent. About Anglo Irish Bank Anglo Irish Bank Corp PLC -- http://www.angloirishbank.com/-- operates in three core areas: business lending, treasury and private banking. The Bank's non-retail business is made up of more than 11,000 commercial depositors spanning commercial entities, charities, public sector bodies, pension funds, credit unions and other non-bank financial institutions. The Company's retail deposits comprise demand, notice and fixed term deposit accounts from personal savers with maturities of up to two years. Non-retail deposits are sourced from commercial entities, charities, public sector bodies, pension funds, credit unions and other non-bank financial institutions. In addition, at Sept. 30, 2008, its non-retail deposits included deposits from Irish Life Assurance plc. The Private Bank offers tailored products and solutions for high net worth clients and operates the Bank's lending business in Ireland and the United Kingdom. * * * As reported by the Troubled Company Reporter-Europe on Dec. 1, 2010, DBRS downgraded the ratings of the Euro Dated Subordinated Notes (specifically the EUR325.2 million Floating Rate Subordinated Notes due 2014, EUR500 million Callable Subordinated Floating Rate Notes due 2016 and the EUR750 million Dated Subordinated Floating Rate Notes due 2017) (collectively referred to as the 2017 Notes) issued by Anglo Irish Bank Corporation Limited (Anglo Irish or the Bank) to 'D' from 'C'. DBRS said the downgrade follows the execution of the Bank's note exchange offer. The default status for the exchanged and now-extinguished 2017 Notes reflects DBRS's view that bondholders were offered limited options, which, as discussed in DBRS's press release dated October 25, 2010, is considered a default per DBRS policy. On Oct. 29, 2010, the Troubled Company Reporter-Europe reported that Standard & Poor's Ratings Services lowered its rating on Anglo Irish Bank Corp. Ltd.'s nondeferrable dated subordinated debt (lower Tier 2) securities to 'D' from 'CCC'. The downgrade of the lower Tier 2 debt rating reflects S&P's opinion that the bank's exchange offer is a "distressed exchange" and tantamount to default in accordance with its criteria. ERC IRELAND: Moody's Reviews 'Caa1' Corporate Family Rating ----------------------------------------------------------- Moody's Investors Service has placed on review for possible downgrade the Caa1 corporate family rating and probability-of- default rating of ERC Ireland Finance Ltd, an indirect parent company of eircom Group Ltd. Concurrently, Moody's has placed on review for possible downgrade the Caa3 ratings on (i) ERCIF's EUR350 million worth of senior unsecured notes due in 2016; (ii) the EUR350 million second-lien term loan of ERC Ireland Holdings Ltd; and (iii) the B3 ratings of ERCIH's EUR3.3 billion senior secured facility. "The rating action follows eircom's announcement that its CFO, Peter Cross, has decided to leave the company," Ivan Palacios, a Moody's Vice President-Senior Analyst and lead analyst for eircom. "In Moody's view, Mr. Cross' departure increases the uncertainty regarding the timing and options considered by the company to remediate its balance sheet, which remains highly leveraged. While the company is undertaking a search for a permanent replacement, the search may take some time and cause delays in the process of determining how to deal with the expected covenant breach in 2011," adds Mr. Palacios. In its rating action of December 3, 2010, Moody's said that the increased uncertainty regarding the economic outlook in Ireland following the country's EU/IMF bailout could in turn (i) lead to a steeper decline in eircom's revenues than originally anticipated; and (ii) accelerate the company's breach of covenants under its existing facilities, which Moody's had expected to occur in the quarter ended June 2011, if not sooner. Moody's review of ERCIF's ratings will focus on the impact of the CFO's departure on the company's plans to remediate its balance sheet. The rating agency believes that the risk of eircom potentially carrying out a debt restructuring has increased. In addition, Moody's notes that any negative implications on the debt-holder's recovery prospects from potential restructuring measures involving a discounted offer on debt components of the capital structure could be considered a distressed exchange and, by implication, a default under Moody's methodologies. Moody's expects to conclude the review process within one month. The ratings could be downgraded as a result of (i) an absence of a detailed plan to reset covenants or receive an equity injection; and/or (ii) indications that eircom might consider a discounted offer on the debt components of its capital structure. Moody's previous rating action on eircom was implemented on December 3, 2010, when the rating agency downgraded to Caa1 from B3 the CFR and PDR of ERCIF. ERCIF (previously known as BCM Ireland Finance Ltd) and ERCIH (previously known as BCM Ireland Holdings Ltd) are holding companies of eircom, the principal provider of fixed-line telecommunications services in Ireland and, following its acquisition of Meteor, the third-largest mobile operator in the country. In the year ended June 30, 2010, eircom generated revenues of EUR1.82 billion and adjusted EBITDA (as reported by the company) of EUR679 million. TBS INTERNATIONAL: Lenders Extend Forbearance Until Jan. 31 ----------------------------------------------------------- TBS International plc on Monday disclosed that its various lender groups have agreed to extend the current forbearance period until January 31, 2011. During such period, the lender groups will continue to forbear from exercising their rights and remedies which arise from the Company's failure to make principal payments when due. The Company will not make principal payments due on its financing facilities during the extended forbearance period, but it will continue to pay interest on those facilities at the default interest rate. The Company and its lenders continue to negotiate amendments to its various financing facilities that will change the current payment schedules and cure any existing defaults, and TBS believes that appropriate amendments to its various financing facilities will be executed prior to the expiration of the deferral. Pursuant to the extended forbearance agreements, the minimum cash liquidity covenant applicable during the forbearance period requires the Company's cash balance, as of the last business day of any week or its weekly average, to be at least US$15 million. About TBS International plc Dublin, Ireland-based TBS International plc (NASDAQ: TBSI) -- http://www.tbsship.com/-- is a fully-integrated transportation service company that provides worldwide shipping solutions to a diverse client base of industrial shippers. As reported in the Troubled Company Reporter on March 19, 2010, PricewaterhouseCoopers LLP, in New York, expressed substantial doubt about the Company's ability to continue as a going concern, following its 2009 results. The independent auditors noted that the Company believes it will not be in compliance with the financial covenants under its credit facilities during 2010, which under the agreements would make the debt callable. "This has created uncertainty regarding the Company's ability to fulfill its financial commitments as they become due." =========================== U N I T E D K I N G D O M =========================== BLADE TOOLING: Staff Awaits Fate Following Administration --------------------------------------------------------- BBC News reports that Blade Tooling Company Limited and Blade Technology's staff are due to learn more about their future in the new year after two firms went into administration. According to BBC, staff members are expected to report back to work on January 4. As reported by the Troubled Company Reporter-Europe on Dec. 28, 2010, BBC said Will Wright and Mark Orton of KPMG were appointed joint administrators of the companies on Dec. 23. Administrators KPMG said no redundancies have yet been made at the companies, BBC noted. KPMG said the businesses, which employ 57 and eight people respectively, were continuing to trade while a buyer was sought, according to BBC. It added the firms have suffered as a result of "tough" trading conditions, BBC said. INEOS GROUP: Mulls Joint Ventures with Companies in Asia -------------------------------------------------------- Peter Marsh at The Financial Times reports that Ineos is moving to diversify away from its European roots through joint ventures with companies in Asia and other emerging regions in high-growth areas of chemicals manufacturing. According to the FT, the company is particularly keen on deals with Chinese companies in the production of acrylonitrile, a raw material used in carbon fiber, a light yet strong substance that is becoming increasingly important in industries such as aircraft and car manufacturing. The plans by Ineos come as the group is emerging from a difficult period in which its future was threatened by high debt and a collapse in earnings triggered by a slump in demand caused by the recession, the FT notes. The FT relates that Tom Crotty, a senior Ineos director, said the company hoped to form joint ventures in acrylonitrile production with Chinese chemicals manufacturers. In such joint ventures, the Chinese companies would gain from Ineos's technological know-how, the FT says. The company, meanwhile, would increase its operations in a part of the world where it is weak, the FT states. Mr. Crotty, as cited by the FT, said that in the next two years Ineos could form "four or five" joint ventures as a way to increase its operations outside Europe and the US. About INEOS Group INEOS Group is a diversified chemical company consisting of several businesses. Product lines include ethylene oxide-based specialty and intermediate chemicals, fluorochemicals used as refrigerants and propellants, and phenol and acetate products. INEOS Chlor makes chlor-alkali chemicals, and INEOS Films and Compounds manufactures PVC and PET films. INEOS Group was formed in 1998 after a management buyout led by CEO Jim Ratcliffe, who controls the group. Mr. Ratcliffe has placed INEOS among the world's top chemical companies (with ExxonMobil, Dow, and BASF) through his many and varied acquisitions. * * * As reported by the Troubled Company Reporter-Europe on Nov. 2, 2010, Moody's Investors Service undertook a series of rating actions related to Ineos Group Holdings plc and its various debt instruments in conjunction with upgrading the corporate family rating by one notch to B3 and assigning a stable outlook: (i) The ratings on the first lien senior secured bank facilities and notes were upgraded by one notch to B1, (ii) The ratings on 2015 second lien senior secured loans were upgraded by one notch to Caa1, and (iii) The ratings on 2016 senior guaranteed notes were upgraded by one notch to Caa2. LEHMAN BROTHERS: European Unit Loses Suits Over 5 Swap Agreements ----------------------------------------------------------------- James Lumley and Lindsay Fortado reporting for Bloomberg News said in a December 21 report that Lehman Brothers Holdings Inc.'s former U.K. unit lost a lawsuit over five swaps agreements and can't force the parties on the other side of the deals to pay the bank. The refusal of the five counterparties mentioned in the cases to pay on the interest-rate swaps will cost Lehman Brothers International Europe around US$90 million, the judgment said, according to the report. U.K. judge Justice Michael Briggs rejected the LBIE Administrators' argument that the condition precedent in Section 2(a)(iii) of the ISDA Master Agreements should be interpreted as being subject to a limitation that it may only be relied upon for a "reasonable time" and their argument that a Non-defaulting Party had any obligation to designate an Early Termination Date. According to news reports, the U.K. Court found that Section 2(a)(iii) is "suspensive" in effect, overturning the non-binding comments in the Marine Trade case that Section 2(a)(iii) is a once-and-for-all test. The U.K. Court also held that there was no breach of the anti- deprivation principle under English insolvency law in the context of the swaps between the parties, reports said. LBIE lawyer William Trower said at a hearing December 6 that the bank wanted clarification of rules established by the International Swaps and Derivatives Association, or ISDA, Bloomberg related. Justice Briggs said in his ruling that his decision should only be applied to the five swaps at issue in this case, the news agency added. LBIE had about 2,000 open swap transactions at the time it went into administration in September 2008. Of those, at least 1,693 had been closed at the time of the insolvency filing. "This is a decision on these five interest rate swaps, rather than one which may automatically be relied upon in relation to all possible circumstances when an ISDA Master Agreement might be used," Justice Briggs said, Bloomberg related. Stephanie Howel, spokeswoman at PricewaterhouseCoopers, the administrators to LBIE, didn't immediately respond to a message seeking comment. In related news, Dow Jones Newswires reported on December 23 that a Lehman Brothers Europe International case that centers on the right of the bank's clients to access billions in ring-fenced money will be heard by the UK Supreme Court, a court spokesman said. ISDA Reacts to LBIE Judgment The International Swaps and Derivatives Association, Inc., who sought and was granted permission to intervene in the swaps case, found the U.K. Court's rulings surprising and is at odds with the market's expectations, according to a news report by Risk Center, a financial risk management media company. Nothing in the ISDA Master Agreement suggests that those suspended obligations would be extinguished at the end of the transaction's term, the ISDA said, according to the report. According to the same report, even before the Lehman case had been brought, the ISDA had started the process of preparing a form of amendment to Section 2(a)(iii) in response to concerns raised by supervisors, including the U.K. Treasury, as to the potential effect of Section 2(a)(iii) following the failure of a major financial institution. This process will continue, and whatever the ultimate outcome of the Lehman case after any appeals, the ISDA said it will consult with its members to agree a form of amendment to Section 2(a)(iii) that ISDA will make available to market participants in order to enable them to amend their ISDA Master Agreements. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008 (Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition disclosed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. The Debtors' bankruptcy cases are handled by Judge James M. Peck. Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife, Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as trustee for the SIPA liquidation of the business of LBI The Bankruptcy Court has approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. International Operations Collapse Lehman Brothers International (Europe), the principal UK trading company in the Lehman group, was placed into administration, together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and Mike Jervis, partners at PricewaterhouseCoopers LLP, have been appointed as joint administrators to Lehman Brothers International (Europe) on September 15, 2008. The joint administrators have been appointed to wind down the business. Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc. filed for bankruptcy in the Tokyo District Court on September 16. Lehman Brothers Japan Inc. reported about JPY3.4 trillion (US$33 billion) in liabilities in its petition. Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers Bankruptcy News. The newsletter tracks the Chapter 11 proceeding undertaken by Lehman Brothers Holdings, Inc., and other insolvency and bankruptcy proceedings undertaken by its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000) PONTIN'S: Gets Offers From Potential Buyers, Administrators Say --------------------------------------------------------------- ThisisSomerset reports that administrators for Pontin's say a number of bidders have made offers for the firm. According to ThisisSomerset, KPMG will shortlist the bids before starting negotiations with potential buyers. It is thought unlikely that the sale will be concluded before 2011, ThisisSomerset says. ThisisSomerset relates that administrators said it was "business as usual". Newspaper reports suggest interested parties were mainly property developers looking to redevelop the sites for housing, ThisisSomerset notes. As reported by the Troubled Company Reporter-Europe on Nov. 16, 2010, BBC News said Pontin's was profitable but had been a victim of the credit crunch and had gone into administration because its bank had withdrawn its support. Pontin's, known for its Bluecoats entertainers, was established in 1946 and at its height owned more than 30 parks. It was founded by Fred Pontin, who was well ahead of his rivals when he spotted the trend for self-catering holiday villages. ROYAL BANK: British Investors Mull Class Action in UK Courts ------------------------------------------------------------ Victoria Thomson at The Scotsman reports that Royal Bank of Scotland could face a class action lawsuit in the UK courts as a number of British investors are understood to be mulling a joint challenge. According to The Scotsman, it is believed a group of mostly institutional investors are looking into launching a case early next year amid continued question marks over RBS's decision to tap investors for GBP12 billion shortly before it went cap in hand to the government for a taxpayer bail-out. RBS is the subject of several class action cases in the US but, until now, UK investors have pursued their grievances individually or sought to take action across the Atlantic where it is thought such actions are easier to win, The Scotsman discloses. If the case goes ahead, it would be the first time the bank would face a combined lawsuit from a number investors in the British courts, The Scotsman notes. As reported by the Troubled Company Reporter-Europe, BBC News said the Financial Services Authority ruled on December 2 that RBS had made bad decisions ahead of a government bail-out in 2008, but cleared it of any wrongdoing, BBC discloses. The FSA investigation followed the near-collapse of RBS, which was saved only after the government stepped in with a rescue package that has left the taxpayer owning 84% of the bank, BBC disclosed. It accused RBS executives of poor judgment in connection with the acquisition of Dutch bank ABN Amro, which left the UK bank severely undercapitalized going into the 2008 financial crisis, according to BBC. About RBS 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 of its entire interest in Global Voice Group Ltd. ROYAL BANK: Charged Less APS Fee by Government, NAO Report Shows ---------------------------------------------------------------- Philip Aldrick at The Daily Telegraph reports that the Government could have charged Lloyds Banking Group and Royal Bank of Scotland an extra GBP3.9 billion to use the Asset Protection Scheme (APS) for their toxic debts. According to The Daily Telegraph, RBS placed GBP282 billion in the fully-formed APS in November 2009, when the minimum exit fee was also set at GBP2.5 billion. The Government also injected another GBP25.5 billion into the bank, lifting the taxpayer's stake to 83%, The Daily Telegraph recounts. The Daily Telegraph relates that in a report on the giant taxpayer-backed insurance scheme, which was set up in 2009 to prevent the lenders' collapse, the National Audit Office said an exit fee of GBP4.4 billion "could have been justified." Under the terms of the deal struck with RBS, the bank will bear the first GBP60 billion of losses and 10% of any subsequent hit, The Daily Telegraph states. As of September, losses on APS assets stood at GBP37 billion, The Daily Telegraph notes. The NAO found that the taxpayer will bear a cost, after fees, if losses on the GBP282 billion portfolio top GBP76 billion, according to The Daily Telegraph. The Daily Telegraph says once losses reach GBP73 billion, the report also found, "the financial incentive on RBS to restrict further losses would weaken significantly". The Asset Protection Agency, which is responsible for ensuring RBS runs the APS assets in the taxpayers' best interests, has estimated "there may be a temporary breach of the first loss by the end of 2011, but subsequent recoveries are expected to keep the lifetime expected net loss at GBP57 billion", the NAO pointed out, according to The Daily Telegraph. About RBS 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 of its entire interest in Global Voice Group Ltd. WHITEHAVEN RLFC: Copeland Council to Repay GBP75,000 Loan --------------------------------------------------------- Alan Irving at News & Star reports that a GBP75,000 loan given to Whitehaven RLFC will be repaid by Copeland's council tax payers. According to News & Star, the council agreed to act as guarantors for the loan from the West Cumbria Development Fund (WCDF) to help the rugby league club stay in business. But when the club went into administration in September, effectively clearing its GBP300,000 debt, the move triggered the need to repay the loan, News & Star relates. The issue was top of the agenda at the WCDF's recent board meeting, but Copeland Council has now said that it will repay the loan rather than WCDF having to formally call it in, News & Star discloses. The council also faces having to pay back a GBP50,000 bank overdraft which it agreed to guarantee to help Whitehaven RLFC survive around the same time as the GBP75,000 loan, News & Star notes. Some council insiders say there may be a possibility of the council being indemnified against the potential loss, according to News & Star. Whitehaven RLFC is a rugby league club playing in Whitehaven in West Cumbria. They play in Co-operative Championship. =============== X X X X X X X X =============== * Upcoming Meetings, Conferences and Seminars --------------------------------------------- January 26-28, 2011 TURNAROUND MANAGEMENT ASSOCIATION TMA Distressed Investing Conference Aria Las Vegas Contact: http://www.turnaround.org/ Jan. 27-28, 2011 AMERICAN BANKRUPTCY INSTITUTE Rocky Mountain Bankruptcy Conference Westin Tabor Center, Denver, Colo. Contact: 1-703-739-0800; http://www.abiworld.org/ Feb. 3-5, 2011 AMERICAN BANKRUPTCY INSTITUTE Caribbean Insolvency Symposium Westin Casuarina Resort & Spa, Grand Cayman Island Contact: 1-703-739-0800; http://www.abiworld.org/ Feb. 24-25, 2011 AMERICAN BANKRUPTCY INSTITUTE Valcon Four Seasons Las Vegas, Las Vegas, Nev. Contact: 1-703-739-0800; http://www.abiworld.org/ Mar. 4, 2011 AMERICAN BANKRUPTCY INSTITUTE Bankruptcy Battleground West Hyatt Regency Century Plaza, Los Angeles, Calif. Contact: 1-703-739-0800; http://www.abiworld.org/ Mar. 7-9, 2011 AMERICAN BANKRUPTCY INSTITUTE Conrad Duberstein Moot Court Competition Duberstein U.S. Courthouse, New York, N.Y. Contact: 1-703-739-0800; http://www.abiworld.org/ Mar. 10, 2011 AMERICAN BANKRUPTCY INSTITUTE Nuts and Bolts - Florida Tampa, Fla. Contact: 1-703-739-0800; http://www.abiworld.org/ Mar. 10-12, 2011 AMERICAN BANKRUPTCY INSTITUTE SUCL/ Alexander L. Paskay Seminar on Bankruptcy Law and Practice Marriott Tampa Waterside, Tampa, Fla. Contact: 1-703-739-0800; http://www.abiworld.org/ Mar. 17-19, 2011 AMERICAN BANKRUPTCY INSTITUTE Byrne Judicial Clerkship Institute Pepperdine University School of Law, Malibu, Calif. Contact: 1-703-739-0800; http://www.abiworld.org/ Mar. 31-Apr. 3, 2011 AMERICAN BANKRUPTCY INSTITUTE Annual Spring Meeting Gaylord National Resort & Convention Center, National Harbor, Md. Contact: 1-703-739-0800; http://www.abiworld.org/ April 27-29, 2011 TURNAROUND MANAGEMENT ASSOCIATION TMA Spring Conference JW Marriott, Chicago, IL Contact: http://www.turnaround.org/ May 5, 2011 AMERICAN BANKRUPTCY INSTITUTE Nuts and Bolts - New York City Association of the Bar of the City of New York, New York, N.Y. Contact: 1-703-739-0800; http://www.abiworld.org/ May 6, 2011 AMERICAN BANKRUPTCY INSTITUTE New York City Bankruptcy Conference Hilton New York, New York, N.Y. Contact: 1-703-739-0800; http://www.abiworld.org/ June 6, 2011 AMERICAN BANKRUPTCY INSTITUTE Canadian-American Cross-Border Insolvency Symposium Fairmont Royal York, Toronto, Ont. Contact: 1-703-739-0800; http://www.abiworld.org/ June 9-12, 2011 AMERICAN BANKRUPTCY INSTITUTE Central States Bankruptcy Workshop Grand Traverse Resort and Spa, Traverse City, Mich. Contact: http://www.abiworld.org/ July 21-24, 2011 AMERICAN BANKRUPTCY INSTITUTE Northeast Bankruptcy Conference Hyatt Regency Newport, Newport, R.I. Contact: 1-703-739-0800; http://www.abiworld.org/ July 27-30, 2011 AMERICAN BANKRUPTCY INSTITUTE Southeast Bankruptcy Workshop The Sanctuary at Kiawah Island, Kiawah Island, S.C. Contact: 1-703-739-0800; http://www.abiworld.org/ Aug. 4-6, 2011 AMERICAN BANKRUPTCY INSTITUTE Mid-Atlantic Bankruptcy Workshop Hotel Hershey, Hershey, Pa. Contact: 1-703-739-0800; http://www.abiworld.org/ Oct. 14, 2011 AMERICAN BANKRUPTCY INSTITUTE NCBJ/ABI Educational Program Tampa Convention Center, Tampa, Fla. Contact: 1-703-739-0800; http://www.abiworld.org/ Oct. __, 2011 AMERICAN BANKRUPTCY INSTITUTE International Insolvency Symposium Dublin, Ireland Contact: 1-703-739-0800; http://www.abiworld.org/ Oct. 25-27, 2011 TURNAROUND MANAGEMENT ASSOCIATION Hilton San Diego Bayfront, San Diego, CA Contact: http://www.turnaround.org/ Dec. 1-3, 2011 AMERICAN BANKRUPTCY INSTITUTE 23rd Annual Winter Leadership Conference La Quinta Resort & Spa, La Quinta, Calif. Contact: 1-703-739-0800; http://www.abiworld.org/ Apr. 19-22, 2012 AMERICAN BANKRUPTCY INSTITUTE Annual Spring Meeting Gaylord National Resort & Convention Center, National Harbor, Md. Contact: 1-703-739-0800; http://www.abiworld.org/ July 14-17, 2012 AMERICAN BANKRUPTCY INSTITUTE Southeast Bankruptcy Workshop The Ritz-Carlton Amelia Island, Amelia Island, Fla. Contact: 1-703-739-0800; http://www.abiworld.org/ 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/ ********* 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 U. Pascual, Marites O. Claro, Rousel Elaine T. Fernandez, Joy A. Agravante, Psyche A. Castillon, 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. 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