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        T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

           Friday, September 30, 2011, Vol. 12, No. 194

                            Headlines



A U S T R I A

HTI: Creditor Banks to Become Shareholders


B E L G I U M

DEXIA BANK: Fitch Downgrades Viability Rating to 'b+'


D E N M A R K

* DENMARK: FIH Real Estate Lending Halt May Trigger Bankruptcies
* DENMARK: To Set Up Rescue Fund for Agricultural Sector


F R A N C E

GOUPAMA SA: Fitch Downgrades Subordinated Debt Rating to 'BB'


G R E E C E

* GREECE: Private Creditors Balk at Bigger Bondholder Losses
* GREECE: Ernst & Young Says Default Inevitable, Recession Likely
* GREECE: Unable to Repay Debts, German Lawmaker Says


I R E L A N D

CORDATUS CLO: Moody's Raises Ratings on Two Note Classes to 'B2'
COUGAR CLO: Moody's Raises Rating on EUR38-Mil. Notes to 'Ba3'
QUINN INSURANCE: To Restate 2009 Figures; "Blue Book" Delayed


I T A L Y

BUZZI UNICEM: S&P Lowers Corp. Credit Ratings to 'BB+/B'


L U X E M B O U R G

TMD FRICTION: Moody's Reviews 'B2' CFR; Direction Uncertain


N E T H E R L A N D S

HALCYON STRUCTURED: Moody's Lifts Rating on Class E Notes to Ba3
MARCO POLO: Withdraws Sanction Bid, Negotiates Release of Ship
MESENA CLO: Class A Notes' Rating Reflects 'CCC' Rated Assets
SABIC INNOVATIVE: CCR Reflects 'bb' Stand-alone Credit Profile


N O R W A Y

SEVAN MARINE: Finds Bankruptcy Solution; Bondholder Talks Ongoing
STOREBRAND LIVFORSIKRING: Fitch Lifts Unsec. Debt Rating to 'BB'


S P A I N

CAJA ESPANA: Moody's Reviews 'Ba1' Sub. Debt Rating for Upgrade
TELEFONICA FINANCE: Fitch Lowers Rating on Pref. Shares to 'BB+'


U N I T E D   K I N G D O M

ALEXON GROUP: Sun European Partners Emerges as Leading Bidder
* UK: Alex Salmond's Green Energy Revolution May Bankrupt Firms
* UK: Insolvency Now a Last Resort, Property Expert Says


X X X X X X X X

* BOOK REVIEW: Learning Leadership


                            *********


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A U S T R I A
=============


HTI: Creditor Banks to Become Shareholders
------------------------------------------
According to SeeNews, HTI High Tech Industries on Tuesday said
that its creditor banks will become its shareholders after a
planned bond conversion in November.

Consequently Oberbank will hold about 3% of HTI's shares,
Raiffeisen-Landesbank Steiermark will have 12%,
Raiffeisenlandesbank Oberoesterreich will have 2%, Raiffeisen
Bank International will have 0.5% and Volksbank Graz-Bruck will
have 3%, SeeNews says.

The hybrid convertible bond has a total volume of EUR9.5 million
(US$12.9 million) and was issued in March 2011 in the course of
the company's restructuring of finances, SeeNews discloses.

After the conversion, HTI's equity will rise to 45.58 million
shares from 36.23 million shares, SeeNews notes.  Each share has
a nominal value of EUR1, SeeNews states.

HTI High Tech Industries is an Austrian industry supplier.


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B E L G I U M
=============


DEXIA BANK: Fitch Downgrades Viability Rating to 'b+'
-----------------------------------------------------
Fitch Ratings has downgraded Dexia's Viability Rating to 'b+'
from 'bb' and affirmed its Long-term Issuer Default Ratings (IDR)
at 'A+'.  The Outlook on the Long-term IDR is Stable.  At the
same time, the agency has affirmed Dexia's three core operating
subsidiaries, Dexia Credit Local, Dexia Bank Belgium and Dexia
Banque Internationale a Luxembourg's Long-term IDRs at 'A+' with
Stable Outlooks.

The downgrade of the Viability Rating to 'b+' from 'bb' is driven
by the impact of the deteriorating operating environment on
Dexia's structural weaknesses, which mainly relate to funding and
liquidity.  If financial markets remain dysfunctional for a
prolonged period, both balance sheet reduction and access to
funding will become more difficult.  In addition, the bank's
financials could be hit by problems faced by the weakest European
sovereigns, especially Greece.  Dexia held EUR3.8bn of Greek
government bonds at end-Q211.

While Dexia has deleveraged its balance sheet through a large
asset sales program and consequently reduced its dependence on
capital markets, these still represent the bank's main source of
funding by far (around 70% at end-Q211).  In addition, the use of
short-term funding has decreased but remains large, in Fitch's
view, leading to tight liquidity.

Dexia has participated in the Greek sovereign bond bail-out
package currently underway and written down exposures maturing
before 2020 by 21%.  However, Fitch considers that further
impairments may be required, putting pressure on capital.

Dexia's Fitch core capital ratio (3.1% at end-Q211) is much lower
than the core Tier 1 regulatory capital ratio (10.3% at the same
date), as the former includes substantial negative revaluation
reserves arising from the bank's available-for-sale portfolio,
which do not currently affect regulatory capital but will be
gradually deducted from capital when CRD IV is implemented.

Dexia's and its three core operating subsidiaries' Long- and
Short-term IDRs remain at their Support Rating Floors of 'A+'.
The Support Rating Floors reflect Fitch's belief that given
Dexia's public ownership and systemic importance, there is an
extremely high probability that support from the states of
Belgium, France and Luxembourg would be forthcoming, if needed.
While there are moves at an international level to implement
resolution regimes, no resolution legislation specific to
Belgian, French or Luxembourg banks is in place at this time.
Fitch notes that a lower propensity or ability of the authorities
to provide support for Dexia would result in a downgrade of the
bank's IDRs.

The rating actions are as follows:

Dexia:

  -- Long-term IDR: affirmed at 'A+'; Outlook Stable
  -- Short-term IDR: affirmed at 'F1+'
  -- Viability Rating: downgraded to 'b+' from 'bb'
  -- Individual Rating: affirmed at 'D'
  -- Support Rating: affirmed at '1'
  -- Support Rating Floor: affirmed at 'A+'

Dexia Credit Local (DCL):

  -- Long-term IDR: affirmed at 'A+'; Outlook Stable
  -- Senior debt: affirmed at 'A+'
  -- Market linked notes: affirmed at 'A+emr'
  -- Subordinated debt: affirmed at 'A'
  -- Hybrid securities: affirmed at 'CCC'
  -- Short-term IDR: affirmed at 'F1+'
  -- Commercial paper: affirmed at 'F1+'
  -- Individual Rating: affirmed at 'D'
  -- Support Rating: affirmed at '1'
  -- Support Rating Floor: affirmed at 'A+'
  -- State guaranteed debt: affirmed at 'AA+'

Dexia Banque Internationale a Luxembourg (DBIL):

  -- Long-term IDR: affirmed at 'A+'; Outlook Stable
  -- Short-term IDR: affirmed at 'F1+'
  -- Senior debt: affirmed at 'A+'
  -- Market linked notes: affirmed at 'A+emr'
  -- Subordinated debt: affirmed at 'A'
  -- Hybrid securities: downgraded to 'CCC' from 'B'
  -- Individual Rating: affirmed at 'D'
  -- Support Rating: affirmed at '1'
  -- Support Rating Floor: affirmed at 'A+'
  -- State guaranteed debt: affirmed at 'AA+'

Dexia Bank Belgium (DBB):

  -- Long-term IDR: affirmed at 'A+'; Outlook Stable
  -- Short-term IDR: affirmed at 'F1+'
  -- Senior debt: affirmed at 'A+'
  -- Upper Tier 2 subordinated debt: affirmed at 'A-'
  -- Individual Rating: affirmed at 'D'
  -- Support Rating: affirmed at '1'
  -- Support Rating Floor: affirmed at 'A+'
  -- State guaranteed debt: affirmed at 'AA+'

Dexia Funding Luxembourg:

  -- Hybrid securities: downgraded to 'CCC' from 'B'

Dexia Funding Netherlands:

  -- Senior debt: affirmed at 'A+'
  -- Market linked notes: affirmed at 'A+emr'
  -- Subordinated debt: affirmed at 'A'

Dexia Financial Products:

  -- Commercial paper: affirmed at 'F1+'

Dexia Delaware LLC:

  -- Commercial paper: affirmed at 'F1+'

Dexia Municipal Agency:

  -- Long-term IDR: affirmed at 'A+'; Outlook Stable
  -- Support Rating: affirmed at '1'

Covered bonds rated 'AAA': unaffected by rating action


=============
D E N M A R K
=============

* DENMARK: FIH Real Estate Lending Halt May Trigger Bankruptcies
----------------------------------------------------------------
According to Bloomberg News' Frances Schwartzkopff, Jyllands-
Posten, citing Chief Executive Officer Bjarne Graven Larsen,
reported that FIH Erhvervsbank A/S, a Danish bank, plans to stop
lending to a number of real estate companies, potentially
triggering bankruptcies by the businesses and other creditors.

Bloomberg relates that Mr., Larsen, as quoted by the Viby,
Denmark-based newspaper, said FIH, which needs to generate cash
to refinance DKK46 billion (US$8.4 billion) in state-guaranteed
bonds through 2013, is asking companies to pay back loans as they
come due.

Jyllands-Posten, citing Mr. Larsen, said a credit crunch may make
it difficult for the businesses to find alternative funding,
probably making bankruptcies unavoidable, Bloomberg notes.


* DENMARK: To Set Up Rescue Fund for Agricultural Sector
--------------------------------------------------------
Frances Schwartzkopff at Bloomberg News reports that Denmark's
farming council is planning to set up a fund to prevent the
country's agricultural industry from collapsing as bank credit
dries up.

According to Bloomberg, Danish Agriculture and Food Council
Business Director Lone Saaby said the fund will target
institutional investors in an effort to generate start capital of
as much as DKK1 billion (US$183 million).  Ms. Saaby, as cited by
Bloomberg, said that the amount will be increased if the fund is
successful in its efforts to support the farming industry.

"There is some urgency," Bloomberg quotes Ms. Saaby as saying in
an interview in Copenhagen on Wednesday.  "We could have a
complete crash of the farming sector and that would hit a lot of
small banks and even larger banks.  That would be the worse-case
scenario."

The credit freeze facing Denmark's farmers threatens to
exacerbate a low-growth trap that has made Denmark the Nordic
region's worst-performing economy, Bloomberg says.  An
agricultural crisis risks squeezing exports and eliminating jobs,
adding to stresses already present in the economy from twin
banking and housing crises, Bloomberg notes.  The agriculture and
food industry is Denmark's largest, employing about 150,000
people and making up about one fifth of total exports, Bloomberg
discloses.

Ms. Saaby said that credit provided by the fund would replace
bank loans, allowing lenders to remove them from their balance
sheets, Bloomberg relates.  She said that still, banks will
probably have to foot a loss on the loans, many of which are
already non-performing, Bloomberg notes.

Bankruptcies in the farming, fishing and forestry industries rose
79% in the first eight months of 2011 from a year earlier,
Bloomberg says, citing data from the Copenhagen-based statistics
agency.


===========
F R A N C E
===========


GOUPAMA SA: Fitch Downgrades Subordinated Debt Rating to 'BB'
-------------------------------------------------------------
Fitch Ratings has downgraded Groupama S.A.'s and four of its core
insurance subsidiaries' Insurer Financial Strength (IFS) ratings
to 'BBB' from 'A-'.  The subsidiaries are Groupama GAN Vie, GAN
Assurances, GAN Eurocourtage and Groupama Transport.  Fitch has
also downgraded Groupama S.A.'s Long-term Issuer Default Rating
(IDR) to 'BBB-' from 'BBB+'.  Groupama S.A.'s subordinated debt
ratings are downgraded to 'BB' from 'BBB-' and placed on Rating
Watch Negative. All rating Outlooks are Negative.

The downgrade reflects the deterioration of Fitch's view of
Groupama's capital adequacy following volatility in the financial
markets, as a result of the group's continued exposure to
volatile asset classes, including equities.

The downgrade and placement of subordinated debt ratings on
Rating Watch Negative reflects Fitch's view of the increased risk
of coupon deferral given the declining level of Groupama's
regulatory solvency.  Should the group's regulatory solvency
margin improve following the remedial action being taken by
management to strengthen capitalization, the Rating Watch
Negative would likely be withdrawn.  However, if the group's
regulatory solvency margin continues to decline, or core group
ratings are further downgraded, Fitch would expect to downgrade
the subordinated debt ratings.

The key rating drivers that could result in a further downgrade
include deterioration of the group's financial profile,
especially in terms of solvency, as well as its inability to
translate measures aimed at improving underwriting results into a
sustainable strong performance in non-life (combined ratio near
100%) and life (new business margin near 1%).

The ratings are supported by Groupama's risk profile, which
benefits from a large degree of business and risk
diversification. The ratings also take into account its solid
business position and improving underwriting profitability.

Fitch will carefully monitor Groupama's ability to rebuild its
capital adequacy via retained earnings to compensate for
increased unrealized capital losses.  The agency considers
Groupama's largest challenge will be to smoothly manage the
reduction of its exposure to equities and southern European
government bonds, especially Greece.

The ratings actions are as follows:

Groupama S.A.

  -- IFS rating downgraded to 'BBB' from 'A-';
     Outlook Negative

  -- Long-term IDR downgraded to 'BBB-' from 'BBB+';
     Outlook Negative

  -- Subordinated debt downgraded to 'BB' from 'BBB-';
     Placed on Rating Watch Negative

  -- Junior subordinated debt downgraded to 'BB' from 'BBB-';
     Placed on Rating Watch Negative

Groupama GAN Vie

  -- IFS rating downgraded to 'BBB' from 'A-'; Outlook Negative

GAN Assurances

  -- IFS rating downgraded to 'BBB' from 'A-'; Outlook Negative

GAN Eurocourtage

  -- IFS rating downgraded to 'BBB' from 'A-'; Outlook Negative

Groupama Transport

  -- IFS rating downgraded to 'BBB' from 'A-'; Outlook Negative


===========
G R E E C E
===========


* GREECE: Private Creditors Balk at Bigger Bondholder Losses
------------------------------------------------------------
Richard Milne, Brooke Masters, Quentin Peel, and Joshua Chaffin
at The Financial Times report that Greece's private creditors
have reacted angrily to suggestions that some eurozone countries
want bondholders to suffer bigger losses than those agreed in the
second bail-out of Athens.

According to the FT, people close the deal said that banks and
other bondholders are resisting the idea by lobbying countries
such as Germany and the Netherlands, where hardliners are pushing
for private creditors to write down more than the current 21%
agreed in July's EUR109 billion Greek rescue.

The backlash from bondholders came as Angela Merkel, German
chancellor, warned Greece that its second bail-out might have to
be reconsidered if deficit reduction targets were missed, the FT
relates.

The push from some countries to reopen negotiations about
bondholder losses has split the eurozone with France and the
European Central Bank leading the opposition, the FT notes.  They
fear that imposing heavier losses, or haircuts, could lead to
fresh selling of eurozone bank shares and lead markets to focus
more acutely on Italy, the eurozone's largest bond market and
third-biggest economy, the FT states.

"If you increase the haircut, you don't get much benefit.  It
would be pure political whim.  You are not going to achieve
anything other than contagion," the FT quotes a German banker as
saying.

The reaction from bondholders came as Jose Manuel Barroso, the
European Commission president, proposed streamlining the
eurozone's EUR440 billion rescue fund by suggesting unanimous
voting requirements that govern its use be eliminated, the FT
notes.


* GREECE: Ernst & Young Says Default Inevitable, Recession Likely
-----------------------------------------------------------------
Fergal O'Brien at Bloomberg News reports that Ernst & Young said
a Greek default is inevitable and there is 35% chance of the
euro-area economy slipping back into recession.

"The euro zone sovereign-debt crisis shows no sign of abating,"
Bloomberg quotes E&Y as saying in an e-mailed report in London on
Thursday.  "A default on Greek government debt now seems
unavoidable.  The key question is when this default will occur
and how it will be managed."

European leaders have struggled to allay investor concerns that a
potential debt restructuring in Greece will plunge the region's
economy into a recession, Bloomberg notes.  Greek bonds have
tumbled and insurance against default has soared as markets put
the probability of insolvency at more than 90%, Bloomberg
relates.  According to Bloomberg, former European Central Bank
chief economist Otmar Issing told Germany's Stern magazine that
the country "won't get back on its feet without a drastic debt
restructuring."

European leaders agreed at a July 21 summit on a second aid
package for Greece that will include contributions from investors
and are aimed to strengthen the powers of the euro region's
rescue fund, Bloomberg recounts.  European Commission President
Jose Barroso, as cited by Bloomberg, said on Wednesday that
authorities "should do everything possible" for a faster creation
of a permanent fund.

Bloomberg relates that E&Y said the European Financial Stability
Facility should be boosted to cover the financing needs of Spain
and Italy, a move that it said would require an almost 700%
increase on its current EUR450 billion (US$613 billion) lending
capacity.

"The sovereign-debt crisis is likely to worsen further, in turn
undermining growth prospects," Bloomberg quotes Marie Diron, an
economist at Oxford Economics and adviser on the E&Y report, as
saying.  "A deeper default than the one in July on Greek
sovereign debt now looks unavoidable."


* GREECE: Unable to Repay Debts, German Lawmaker Says
-----------------------------------------------------
According to Bloomberg, Klaus-Peter Willsch, a German lawmaker
from Chancellor Angela Merkel's Christian Democrats party, told
the N-TV television program Das Duell that Greece is unable to
repay its debts.

Bloomberg relates that Mr. Willsch said in an e-mailed summary of
the interview that German taxpayers cannot be expected to
permanently compensate for Greece's deficit.  The euro monetary
union should continue with fewer members, N-TV reported
Mr. Willsch as saying.


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I R E L A N D
=============


CORDATUS CLO: Moody's Raises Ratings on Two Note Classes to 'B2'
----------------------------------------------------------------
Moody's Investors Service has upgraded the ratings of these notes
issued by Cordatus CLO II P.L.C.:

   -- EUR101.25MM Senior Secured Floating Rate Variable Funding
      Notes due 2024, Upgraded to Aaa (sf); previously on Jun 22,
      2011 Aa1 (sf) Placed Under Review for Possible Upgrade

   -- EUR97.5MM Euro Class A1 Senior Secured Floating Rate Term
      Notes due 2024, Upgraded to Aaa (sf); previously on Jun 22,
      2011 Aa1 (sf) Placed Under Review for Possible Upgrade

   -- EUR60MM Euro Class A1 Senior Secured Floating Rate Delayed
      Draw Notes due 2024, Upgraded to Aaa (sf); previously on
      Jun 22, 2011 Aa1 (sf) Placed Under Review for Possible
      Upgrade

   -- GBP22.83MM Sterling Class A2 Senior Secured Floating Rate
      Notes due 2024, Upgraded to Aaa (sf); previously on Jun 22,
      2011 Aa1 (sf) Placed Under Review for Possible Upgrade

   -- EUR38.7MM Class B Deferrable Secured Floating Rate Notes
      due 2024, Upgraded to A1 (sf); previously on Jun 22, 2011
      Baa1 (sf) Placed Under Review for Possible Upgrade

   -- EUR28.35MM Class C Deferrable Secured Floating Rate Notes
      due 2024, Upgraded to Baa2 (sf); previously on Jun 22, 2011
      Ba1 (sf) Placed Under Review for Possible Upgrade

   -- EUR27MM Class D Deferrable Secured Floating Rate Notes due
      2024, Upgraded to Ba2 (sf); previously on Jun 22, 2011 B1
      (sf) Placed Under Review for Possible Upgrade

   -- EUR16.2MM Class E Deferrable Secured Floating Rate Notes
      due 2024, Upgraded to B1 (sf); previously on Jun 22, 2011
      Caa2 (sf) Placed Under Review for Possible Upgrade

   -- EUR5.5MM Class F1 Deferrable Secured Floating Rate Notes
      due 2024, Upgraded to B2 (sf); previously on Jun 22, 2011
      Caa3 (sf) Placed Under Review for Possible Upgrade

   -- EUR1.25MM Class F2 Deferrable Secured Floating Rate Notes
      due 2024, Upgraded to B2 (sf); previously on Jun 22, 2011
      Caa3 (sf) Placed Under Review for Possible Upgrade

Ratings Rationale

Cordatus CLO II P.L.C., issued in July 2007, is a multi-currency
Collateralised Loan Obligation backed by a portfolio of mostly
high yield European loans. The portfolio is managed by CVC
Cordatus Group Limited. This transaction will be in reinvestment
period until July 2014. It is predominantly composed of senior
secured loans.

According to Moody's, the rating actions taken on the notes are
primarily a result of applying Moody's revised CLO assumptions
described in "Moody's Approach to Rating Collateralized Loan
Obligations'' published in June 2011.

The actions reflect key changes to the modeling assumptions,
which incorporate (1) a removal of the temporary 30% default
probability macro stress implemented in February 2009, (2)
increased BET liability stress factors as well as (3) change to a
fixed recovery rate modeling framework. Additional changes to the
modelling assumptions include (1) standardizing the modelling of
collateral amortization profile, and (2) changing certain credit
estimate stresses aimed at addressing the lack of forward looking
indicators as well as time lags in receiving information required
for credit estimate updates.

Moody's also notes that this action also reflects improvements of
the transaction performance since the last rating action. In
Moody's view, positive developments coincide with reinvestment of
sale proceeds (including higher than previously anticipated
recoveries realized on defaulted securities) into substitute
assets with higher par amounts and/or higher ratings.

The overcollateralization ratios of the rated notes have slightly
improved since the rating action in August 2009. The Senior and
Class F overcollateralization ratios are reported at 152.2% and
106.5%, respectively, versus July 2009 levels of 150.7% and
105.9%, respectively, and all related overcollateralization tests
are currently in compliance.

Reported WARF has increased from 2706 to 3093 between July 2009
and July 2011.

The change in reported WARF understates the actual credit quality
improvement because of the technical transition related to rating
factors of European corporate credit estimates, as announced in
the press release published by Moody's on 1 September 2010. In
addition, securities rated Caa or lower make up approximately
8.7% of the underlying portfolio versus 9.4% in July 2009.
Additionally, defaulted securities total about EUR10.2 million of
the underlying portfolio compared to EUR4.6 million in July 2009.

Due to the impact of revised and updated key assumptions
referenced in "Moody's Approach to Rating Collateralized Loan
Obligations" published in June 2011, key model inputs used by
Moody's in its analysis, such as the portfolio par amount, WARF,
diversity score, and weighted average recovery rate, may be
different from the trustee's reported numbers. In its base case,
Moody's analyzed the underlying collateral pool to have a
performing par and principal proceeds balance of EUR416.7
million, defaulted par of EUR 10.2 million, a weighted average
default probability of 27.2% (consistent with a WARF of 3260), a
weighted average recovery rate upon default of 41.6% for a Aaa
liability target rating, a diversity score of 28 and a weighted
average spread of 3.4%. The default probability is derived from
the credit quality of the collateral pool and Moody's expectation
of the remaining life of the collateral pool. The average
recovery rate to be realized on future defaults is based
primarily on the seniority of the assets in the collateral pool.
For a Aaa liability target rating, Moody's assumed that 79% of
the portfolio exposed to senior secured corporate assets would
recover 50% upon default, while the remainder non first-lien loan
corporate assets would recover 10%. In each case, historical and
market performance trends and collateral manager latitude for
trading the collateral are also relevant factors. These default
and recovery properties of the collateral pool are incorporated
in cash flow model analysis where they are subject to stresses as
a function of the target rating of each CLO liability being
reviewed.

Moody's notes that this transaction is subject to a high level of
macroeconomic uncertainty, as evidenced by (1) uncertainties of
credit conditions in the general economy, especially as14.6% of
the portfolio is exposed to obligors located in Ireland, Spain
and Italy and (2) the large concentration of speculative-grade
debt maturing between 2012 and 2015 which may create challenges
for issuers to refinance. CLO notes' performance may also be
impacted by (1) the manager's investment strategy and behavior
and (2) divergence in legal interpretation of CDO documentation
by different transactional parties due to embedded ambiguities.

Sources of additional performance uncertainties are:

(1) Moody's also notes that around 65.7% of the collateral pool
consists of debt obligations whose credit quality has been
assessed through Moody's credit estimates. Large single exposures
to obligors bearing a credit estimate have been subject to a
stress applicable to concentrated pools as per the report titled
"Updated Approach to the Usage of Credit Estimates in Rated
Transactions" published in October 2009.

(2) Recovery of defaulted assets: Market value fluctuations in
defaulted assets reported by the trustee and those assumed to be
defaulted by Moody's may create volatility in the deal's
overcollateralization levels. Further, the timing of recoveries
and the manager's decision to work out versus sell defaulted
assets create additional uncertainties. Moody's analyzed
defaulted recoveries assuming the lower of the market price and
the recovery rate in order to account for potential volatility in
market prices.

(3) Weighted average life: The notes' ratings are sensitive to
the weighted average life assumption of the portfolio, which may
be extended due to the manager's decision to reinvest into new
issue loans or other loans with longer maturities and/or
participate in amend-to-extend offerings. Moody's tested for a
possible extension of the actual weighted average life in its
analysis.

(4) Other collateral quality metrics: The deal is allowed to
reinvest and the manager has the ability to deteriorate the
collateral quality metrics' existing cushions against the
covenant levels. Moody's analyzed the impact of assuming lower of
reported and covenanted values for weighted average rating
factor, weighted average spread, weighted average coupon, and
diversity score.

(5) The deal has significant exposure to non-EUR denominated
assets. Volatilities in foreign exchange rate will have a direct
impact on interest and principal proceeds available to the
transaction, which may affect the expected loss of rated
tranches.

The principal methodology used in this rating was "Moody's
Approach to Rating Collateralized Loan Obligations" published in
June 2011.

Moody's modeled the transaction using the Binomial Expansion
Technique, as described in Section 2.3.2.1 of the "Moody's
Approach to Rating Collateralized Loan Obligations" rating
methodology published in June 2011

The cash flow model used for this transaction, whose description
can be found in the methodology listed above, is Moody's EMEA
Cash-Flow model.

In addition to the quantitative factors that are explicitly
modeled, qualitative factors are part of the rating committee
considerations. These qualitative factors include the structural
protections in each transaction, the recent deal performance in
the current market environment, the legal environment, specific
documentation features, the collateral manager's track record,
and the potential for selection bias in the portfolio. All
information available to rating committees, including
macroeconomic forecasts, input from other Moody's analytical
groups, market factors, and judgments regarding the nature and
severity of credit stress on the transactions, may influence the
final rating decision.


COUGAR CLO: Moody's Raises Rating on EUR38-Mil. Notes to 'Ba3'
--------------------------------------------------------------
Moody's Investors Service has taken these rating actions on notes
issued by Cougar CLO I PLC:

Issuer: Cougar CLO I PLC

   -- EUR38,000,000 Class B Subordinated Notes due 2020
      (currently EUR 22.1 outstanding rated balance), Upgraded to
      Ba3 (sf); previously on Jun 22, 2011 B1 (sf) Placed Under
      Review for Possible Upgrade

   -- EUR105,000,000 Class A Senior Secured Floating Rate Notes
      due 2020 (currently EUR 67.4M outstanding), Confirmed at
      Aa3 (sf); previously on Jun 22, 2011 Aa3 (sf) Placed Under
      Review for Possible Upgrade

The ratings assigned to the Class B Subordinated Notes address
the repayment of the Rated Balance on or before the legal final
maturity, where the Rated Balance is equal at any time to the
principal amount of the Class B Subordinated Notes on the issue
date minus the aggregate of all payments made in respect of such
Notes from the issue date to such date, either through interest
or principal payments. The rating on class B notes is not an
opinion about the ability of the issuer to pay interest. Moody's
outstanding Rated Balance on the Class B Subordinated Notes
(currently EUR 22.1M) may not necessarily correspond to the
outstanding notional amounts reported by the trustee.

Ratings Rationale

Cougar CLO I PLC, issued in December 2005, is a single currency
Collateralised Loan Obligation ("CLO") backed by a portfolio of
mostly high yield European loans. The portfolio is managed by M&G
Investment Management Limited. The reinvestment period ended in
July 2010. The portfolio is predominantly composed of senior
secured loans (77.5%) as well as some mezzanine loans (4.2%),
second lien loans (17.3%) and HY bonds (1%).

According to Moody's, the rating actions taken on the notes are
primarily a result of applying Moody's revised CLO assumptions
described in "Moody's Approach to Rating Collateralized Loan
Obligations" published in June 2011. The actions also reflect
consideration of an increase in the transaction's
overcollateralization ratios due to deleveraging since the last
rating action in December 2009.

The actions reflect key changes to the modelling assumptions,
which incorporate (1) a removal of the temporary 30% default
probability macro stress implemented in February 2009, (2)
increased BET liability stress factors as well as (3) change to a
fixed recovery rate modelling framework. Additional changes to
the modelling assumptions include changing certain credit
estimate stresses aimed at addressing the lack of forward looking
indicators as well as time lags in receiving information required
for credit estimate updates.

Moody's notes that the Class A notes have been paid down by
approximately 36%, or EUR37.6 million, since the rating action in
December 2009. As a result of the deleveraging, the
overcollateralization ratios have increased since the rating
action in December 2009. As of the latest trustee report dated
August 2011, the Class A Overcollateralization ratio is reported
at 137.18%, versus the October 2009 level of 126%. The
overcollateralization ratio of the class B rated balance also
increased due to interest and principal repayments. Since the
last rating action in December 2009, the overcollateralization
ratio of the class B rated balance increased from 101.87% to
108.11%.

Due to the impact of revised and updated key assumptions
referenced in "Moody's Approach to Rating Collateralized Loan
Obligations" published in June 2011, key model inputs used by
Moody's in its analysis, such as the portfolio par amount, WARF,
diversity score, and weighted average recovery rate, may be
different from the trustee's reported numbers. In its base case,
Moody's analyzed the underlying collateral pool to have a
performing par and principal proceeds balance of EUR 96.88
million, a weighted average default probability of 23.75%
(consistent with a WARF of 3441), a weighted average recovery
rate upon default of 40.4% for a Aaa liability target rating, a
diversity score of 27 and a weighted average spread of 3.2%. The
default probability is derived from the credit quality of the
collateral pool and Moody's expectation of the remaining life of
the collateral pool. The average recovery rate to be realized on
future defaults is based primarily on the seniority of the assets
in the collateral pool. For a Aaa liability target rating,
Moody's assumed that 76% of the portfolio exposed to senior
secured corporate assets would recover 50% upon default, while
the remainder non first-lien loan corporate assets would recover
10%. Because approximately 17% of non first lien loans assets in
the portfolio are second-lien loans, Moody's also considered a
scenario with a slightly higher weighted average recovery rate
upon default of 43.1% for a Aaa liability rating. This is
assuming that the second-lien loans would recover 25% upon
default instead of 10%.

In each case, historical and market performance trends and
collateral manager latitude for trading the collateral are also
relevant factors. These default and recovery properties of the
collateral pool are incorporated in cash flow model analysis
where they are subject to stresses as a function of the target
rating of each CLO liability being reviewed.

Moody's notes that this transaction is subject to a high level of
macroeconomic uncertainty, as evidenced by 1) uncertainties of
credit conditions in the general economy and 2) the large
concentration of speculative-grade debt maturing between 2012 and
2015 which may create challenges for issuers to refinance. CLO
notes' performance may also be impacted by 1) the manager's
investment strategy and behavior and 2) divergence in legal
interpretation of CDO documentation by different transactional
parties due to embedded ambiguities.

Sources of additional performance uncertainties are:

(1) Deleveraging: The main source of uncertainty in this
transaction is whether delevering from unscheduled principal
proceeds will continue and at what pace. Deleveraging may
accelerate due to high prepayment levels in the loan market
and/or collateral sales by the manager, which may have
significant impact on the notes' ratings.

(2) Moody's also notes that around 60% of the collateral pool
consists of debt obligations whose credit quality has been
assessed through Moody's credit estimates. Large single exposures
to obligors bearing a credit estimate have been subject to a
stress applicable to concentrated pools as per the report titled
"Updated Approach to the Usage of Credit Estimates in Rated
Transactions" published in October 2009.

(3) Weighted average life: The notes' ratings are sensitive to
the weighted average life assumption of the portfolio, which may
be extended due to the manager's decision to reinvest into new
issue loans or other loans with longer maturities and/or
participate in amend-to-extend offerings.

The principal methodology used in this rating was "Moody's
Approach to Rating Collateralized Loan Obligations" published in
June 2011.

Moody's modelled the transaction using the Binomial Expansion
Technique, as described in Section 2.3.2.1 of the "Moody's
Approach to Rating Collateralized Loan Obligations" rating
methodology published in June 2011.

The cash flow model used for this transaction, whose description
can be found in the methodology listed above, is Moody's CDOEdge
model.

In addition to the quantitative factors that are explicitly
modelled, qualitative factors are part of the rating committee
considerations. These qualitative factors include the structural
protections in each transaction, the recent deal performance in
the current market environment, the legal environment, specific
documentation features, the collateral manager's track record,
and the potential for selection bias in the portfolio. All
information available to rating committees, including
macroeconomic forecasts, input from other Moody's analytical
groups, market factors, and judgments regarding the nature and
severity of credit stress on the transactions, may influence the
final rating decision.


QUINN INSURANCE: To Restate 2009 Figures; "Blue Book" Delayed
-------------------------------------------------------------
Laura Noonan at Irish Independent reports that this year's
insurance industry data will be at least two months late to allow
Quinn Insurance to "restate" its 2009 figures and give the Cavan
insurer time to get its 2010 accounts signed off.

According to Irish Independent, senior industry sources confirmed
that insurers have been told that this year's "Blue Book"
compiled by the Central Bank, and a separate "Factfile" from the
Irish Insurance Federation (IIF), won't be ready until late
November at the earliest.

It is understood that the delay in this year's publications
relate primarily to two issues with Quinn Insurance Limited
(QIL), which has been under administration since March 2010,
Irish Independent discloses.

QIL is "restating" its figures for 2009 to incorporate the impact
of guarantees the insurers gave for its parent companies'
borrowings, Irish Independent says.  The sources, as cited by the
sources, said that preliminary confidential data circulated this
week suggests the restatement is "significant".

QIL has also told the Central Bank and the IIF that it will not
be in a position to file its 2010 figures until November, when
its accounts have been signed off by auditors, Irish Independent
notes.

                      About Quinn Insurance

Quinn Insurance is owned by Sean Quinn, who was once Ireland's
richest man, and his family.  The company has more than 20% of
the motor and health insurance market in Ireland.  Employing
almost 2,800 people in Britain and Ireland, it was founded in
1996 and entered the UK market in 2004.

As reported by the Troubled Company Reporter-Europe, The Irish
Times said the Financial Regulator put Quinn Insurance into
administration in March 2010 after his office discovered
guarantees had been provided by the insurer's subsidiaries as far
back as 2005 on Quinn Group debts of more than EUR1.2 billion.
The regulator said the guarantees reduced the amount the firm had
in reserve to protect policyholders against possible claims,
putting 1.3 million customers at risk, according to the Irish
Times.


=========
I T A L Y
=========


BUZZI UNICEM: S&P Lowers Corp. Credit Ratings to 'BB+/B'
--------------------------------------------------------
Standard & Poor's Ratings Services lowered its long- and short-
term corporate credit ratings on Italy-based heavy materials
manufacturer Buzzi Unicem SpA and German subsidiary Dyckerhoff AG
to 'BB+/B' from 'BBB-/A-3'. The outlook is stable.

"The downgrade reflects our view that Buzzi's Standard & Poor's-
adjusted credit measures are unlikely to recover to the levels we
consider commensurate with an investment-grade rating in the
short term. We also view the group's limited covenant headroom,
in combination with sizable debt maturities that include
Dyckerhoff's mezzanine debt, as a risk that could lead to less-
than-adequate liquidity," S&P said.

"We believe that the group will continue to face significant
pressure on margins and cash flows, given our expectations that
end-market conditions will remain difficult over the rest of 2011
and likely 2012, particularly in the U.S. and Italy," S&P stated.

Although Dyckerhoff's stand-alone credit profile continues to be
stronger than that of Buzzi, the ratings on Dyckerhoff are capped
by those on Buzzi. "This is because of Dyckerhoff's strong
integration within the Buzzi group and our assumption that if
need be, Dyckerhoff would provide support to Buzzi through
dividend payouts, as was the case in 2010," S&P stated.

"In our view, the Buzzi group's credit metrics should stabilize
by year-end 2011, with FFO to debt in the region of 20%. We
believe that operating performance in 2012 will continue to
suffer from depressed end markets, making a return to investment-
grade credit metrics unlikely in the short term. The outlook also
incorporates the assumption that our concerns over liquidity will
be tackled in the near term," S&P stated.

Downside rating pressure could arise should Buzzi fail to address
its liquidity in a timely manner, in particular the very tight
covenant headroom on its USPP debt and the upcoming refinancing
of the EUR233 million due on the mezzanine loan.  "Although we
consider it to be less likely, downside pressure on the ratings
could also arise should the group experience further margin
pressure due to a combination of continued sluggish volumes and
further pressure on prices," S&P stated.

Ratings upside would be conditional on a restoration of credit
metrics in line with a solid significant financial risk profile
-- for example, FFO to debt sustained at, or above, 25%.  This
would likely result from a strong and sustainable recovery in the
group's high-profit markets such as Eastern Europe and/or the
U.S.


===================
L U X E M B O U R G
===================


TMD FRICTION: Moody's Reviews 'B2' CFR; Direction Uncertain
-----------------------------------------------------------
Moody's Investors Service has placed under review with direction
uncertain the B2 Corporate Family Rating (CFR) of TMD Friction
Group S.A.'s and B2 rating of the EUR160 million Senior Secured
Notes issued by TMD Friction Finance S.A.

Ratings Rationale

The rating review was prompted by TMD Friction's announcement
that its shareholders have reached agreement with Nisshinbo
Holdings Inc. ("NISH)" on the acquisition of TMD Friction Group
S.A. by NISH. The acquisition is subject to competition authority
approval but expected to complete still in 2011. According to the
announcement by TMD Friction, NISH intends to operate TMD
Friction as an independent, wholly owned subsidiary.

NISH is a Japanese holding company listed on the Tokyo Stock
Exchange. Its subsidiaries are active in textiles, automobile
brakes, papers, mechatronics, chemicals and electronics. In the
fiscal year ending March 2011 consolidated sales amounted to
JPY325,555 million (approximately EUR3 billion).

The rating review will focus on the implications of the
acquisition on TMD Friction's business strategy, financial policy
or capital structure, if any. The review will also consider the
benefits to TMD Friction of being part of a larger, publicly
listed group. Moody's notes that completion of the acquisition
would require TMD Friction Finance S.A. to offer to repurchase
the EUR160 million Senior Secured Notes at a purchase price equal
to 101% of their aggregate principal amount, plus accrued and
unpaid interest to the date of the purchase. The rating review
will also focus on the result of this offer and what impact this
could have on the capital and debt structure of TMD Friction.
Moody's rating review will further focus on the form of
cooperation between TMD Friction and NISH's brake business and
the resulting implications on TMD Friction's business profile.
According to TMD Friction, the combined companies will be one of
the world's largest automotive brake friction manufacturers with
(i) revenues of over EUR1.0 billion and over 6,000 employees and
(ii) an extensive global customer base and minimal geographic
overlap.

If TMD Friction's business strategy, financial policy and capital
structure remain unchanged, Moody's currently does not anticipate
that the rating review would result in a rating change.

TMD Friction's current B2 ratings are based on: (i) the group's
strong position in the original equipment market and the
aftermarket for automotive brake pads and linings; (ii) a large
share of its revenues being generated in the usually more
resilient aftermarket; (iii) the company's advanced technologies,
which allow it to supply original equipment manufacturing (OEM)
customers worldwide despite region-specific product requirements;
(iv) the company's established and solid relationships with
automobile manufacturers and auto equipment suppliers; and (v)
the company's enhanced operating performance, which is the result
of a reduced cost base on the back of successful rationalization
and cost cutting initiatives in recent years.

However, the current B2 ratings remain constrained by the
company's limited diversification in terms of geography and
product scope. In addition, there is strong competition among
suppliers in the automotive OEM market, which is in turn highly
exposed to fluctuations in the overall economic environment.
Moreover, Moody's expects that TMD Friction's high interest costs
combined with further investments in growth opportunities will
pose a significant challenge to material positive free cash flow
generation. Lastly, the company is also exposed to raw material
price fluctuations (e.g., steel, copper and chemicals) and may be
challenged to recover increasing input costs from customers in a
timely fashion.

The principal methodology used in rating TMD Friction Group S.A.
was the Global Automotive Supplier Industry Methodology published
in January 2009. Other methodologies used include Loss Given
Default for Speculative-Grade Non-Financial Companies in the
U.S., Canada and EMEA published in June 2009.

TMD Friction is a manufacturer of brake pads and linings based in
Luxembourg with manufacturing operations in Europe, USA, China,
Mexico, Brazil and South Africa. The company generated EUR637
million of revenues in 2010. Thereof, 41% were generated by the
Independent Aftermarket Segment ("IAM") which manufactures
branded (c90%) and private label (c10%) replacement brake pads
and linings sold to end customers through independent dealers and
repair shops. Further 28% of 2010 revenues were generated by the
"OES" segment which produces original brake pads and linings for
replacement sold through the dealership network of car
manufacturers. 31% of revenues were generated by the "OEM"
segment which supplies brake pads and linings for initial car or
truck production. In the OEM segment TMD actually delivers to
Tier-1 suppliers which manufacture the brake systems. However,
the car manufacturer specifies the brake pad/lining supplier in
most cases. In total, TMD operates 16 manufacturing sites with
more than 4,500 employees. TMD is currently owned owned by
private equity firm Pamplona Capital Management and management.

On Review Direction Uncertain:

   Issuer: TMD Friction Finance S.A.

   -- Senior Secured Regular Bond/Debenture, Placed on Review
      Direction Uncertain, currently B2, LGD3, 48 %

   -- Senior Secured Regular Bond/Debenture, Placed on Review
      Direction Uncertain, currently B2, LGD3, 48 %

   Issuer: TMD Friction Group S.A.

   -- Probability of Default Rating, Placed on Review Direction
      Uncertain, currently B2

   -- Corporate Family Rating, Placed on Review Direction
      Uncertain, currently B2

Outlook Actions:

   Issuer: TMD Friction Finance S.A.

   -- Outlook, Changed To Rating Under Review From Stable

   Issuer: TMD Friction Group S.A.

   -- Outlook, Changed To Rating Under Review From Stable


=====================
N E T H E R L A N D S
=====================


HALCYON STRUCTURED: Moody's Lifts Rating on Class E Notes to Ba3
----------------------------------------------------------------
Moody's Investors Service has upgraded the ratings of these notes
issued by Halcyon Structured Asset Management European CLO 2007-I
B.V.:

   -- EUR90MM A2 Notes, Upgraded to Aaa (sf); previously on
      Jun 22, 2011 Aa1 (sf) Placed Under Review for Possible
      Upgrade

   -- EUR51MM B Notes, Upgraded to Aa3 (sf); previously on
      Jun 22, 2011 A3 (sf) Placed Under Review for Possible
      Upgrade

   -- EUR36MM C Notes, Upgraded to Baa1 (sf); previously on
      Jun 22, 2011 Ba1 (sf) Placed Under Review for Possible
      Upgrade

   -- EUR37.5MM D Notes, Upgraded to Ba1 (sf); previously on
      Jun 22, 2011 B2 (sf) Placed Under Review for Possible
      Upgrade

   -- EUR22.5MM E Notes, Upgraded to Ba3 (sf); previously on
      Jun 22, 2011 Caa2 (sf) Placed Under Review for Possible
      Upgrade

Ratings Rationale

Halcyon Structured Asset Management European CLO 2007-I B.V.,
issued in May 2007, is a multi currency Collateralised Loan
Obligation ("CLO") backed by a portfolio of mostly high yield
European loans. The portfolio is managed by Halcyon Structured
Asset Management L.P. This transaction will be in reinvestment
period until 24 July 2013. It is predominantly composed of senior
secured loans.

According to Moody's, the rating actions taken on the notes are
primarily a result of applying Moody's revised CLO assumptions
described in "Moody's Approach to Rating Collateralized Loan
Obligations" published in June 2011.

The actions reflect key changes to the modeling assumptions,
which incorporate (1) a removal of the temporary 30% default
probability macro stress implemented in February 2009, (2)
increased BET liability stress factors as well as (3) change to a
fixed recovery rate modeling framework. Additional changes to the
modeling assumptions include (1) standardizing the modeling of
collateral amortization profile, and (2) changing certain credit
estimate stresses aimed at addressing the lack of forward looking
indicators as well as time lags in receiving information required
for credit estimate updates.

Moody's notes that the transaction performance has been stable
since the last rating action.

Reported WARF has increased from 2774 to 2857 between January
2010 and July 2011. However, the change in reported WARF
understates the actual credit quality improvement because of the
technical transition related to rating factors of European
corporate credit estimates, as announced in the press release
published by Moody's on September 1, 2010. Additionally,
defaulted securities total about EUR1.7 million of the underlying
portfolio compared to EUR19.8 million in January 2010.

Due to the impact of revised and updated key assumptions
referenced in "Moody's Approach to Rating Collateralized Loan
Obligations" published in June 2011, key model inputs used by
Moody's in its analysis, such as the portfolio par amount, WARF,
diversity score, and weighted average recovery rate, may be
different from the trustee's reported numbers. In its base case,
Moody's analyzed the underlying collateral pool to have a
performing par and principal proceeds balance of EUR549 million,
defaulted par of EUR1.7 million, a weighted average default
probability of 31.04% (consistent with a WARF of 3014), a
weighted average recovery rate upon default of 45.12% for a Aaa
liability target rating, a diversity score of 39 and a weighted
average spread of 3.00%. The default probability is derived from
the credit quality of the collateral pool and Moody's expectation
of the remaining life of the collateral pool. The average
recovery rate to be realized on future defaults is based
primarily on the seniority of the assets in the collateral pool.
For a Aaa liability target rating, Moody's assumed that 87.8% of
the portfolio exposed to senior secured corporate assets would
recover 50% upon default, while the remainder non first-lien loan
corporate assets would recover 10%. In each case, historical and
market performance trends and collateral manager latitude for
trading the collateral are also relevant factors. These default
and recovery properties of the collateral pool are incorporated
in cash flow model analysis where they are subject to stresses as
a function of the target rating of each CLO liability being
reviewed.

The deal is allowed to reinvest and the manager has the ability
to deteriorate the collateral quality metrics' existing cushions
against the covenant levels. Moody's analyzed the impact of
assuming lower of reported and covenanted values for weighted
average rating factor and diversity score.

However, in this case, given the limited time remaining in the
deal's reinvestment period, Moody's analyzed the impact of
assuming weighted average spread consistent with the midpoint
between reported and covenanted values.

Moody's notes that this transaction is subject to a high level of
macroeconomic uncertainty, as evidenced by (1) uncertainties of
credit conditions in the general economy and (2) the large
concentration of speculative-grade debt maturing between 2012 and
2015 which may create challenges for issuers to refinance. CLO
notes' performance may also be impacted by (1) the manager's
investment strategy and behavior and (2) divergence in legal
interpretation of CDO documentation by different transactional
parties due to embedded ambiguities.

Sources of additional performance uncertainties are:

(1) Moody's also notes that around 62% of the collateral pool
consists of debt obligations whose credit quality has been
assessed through Moody's credit estimates. Large single exposures
to obligors bearing a credit estimate have been subject to a
stress applicable to concentrated pools as per the report titled
"Updated Approach to the Usage of Credit Estimates in Rated
Transactions" published in October 2009.

(2) Recovery of defaulted assets: Market value fluctuations in
defaulted assets reported by the trustee and those assumed to be
defaulted by Moody's may create volatility in the deal's
overcollateralization levels. Further, the timing of recoveries
and the manager's decision to work out versus sell defaulted
assets create additional uncertainties.

(3) Weighted average life: The notes' ratings are sensitive to
the weighted average life assumption of the portfolio, which may
be extended due to the manager's decision to reinvest into new
issue loans or other loans with longer maturities and/or
participate in amend-to-extend offerings. Moody's tested for a
possible extension of the actual weighted average life in its
analysis.

(4) The deal has significant exposure to non-EUR denominated
assets. Volatilities in foreign exchange rate will have a direct
impact on interest and principal proceeds available to the
transaction, which may affect the expected loss of rated
tranches.

The principal methodology used in this rating was "Moody's
Approach to Rating Collateralized Loan Obligations" published in
June 2011.

Moody's modeled the transaction using the Binomial Expansion
Technique, as described in Section 2.3.2.1 of the "Moody's
Approach to Rating Collateralized Loan Obligations" rating
methodology published in June 2011.

The cash flow model used for this transaction, whose description
can be found in the methodology listed above, is Moody's EMEA
Cash-Flow model.

In addition to the quantitative factors that are explicitly
modeled, qualitative factors are part of the rating committee
considerations. These qualitative factors include the structural
protections in each transaction, the recent deal performance in
the current market environment, the legal environment, specific
documentation features, the collateral manager's track record,
and the potential for selection bias in the portfolio. All
information available to rating committees, including
macroeconomic forecasts, input from other Moody's analytical
groups, market factors, and judgments regarding the nature and
severity of credit stress on the transactions, may influence the
final rating decision.


MARCO POLO: Withdraws Sanction Bid, Negotiates Release of Ship
--------------------------------------------------------------
Dow Jones' DBR Small Cap reports that Marco Polo Seatrade BV is
backing down from its bid to slam a lender with sanctions after
negotiating the release of one of its vessels.

As reported in the Sept. 6, 2012 edition of the TCR, Marco Polo
Seatrade BV asked the U.S. Bankruptcy Court in New York to hold
Credit Agricole Corporate and Investment Bank in contempt and
order sanctions against the lender.  Marco Polo said that a
Credit Agricole SA unit must pay damages for holding one of the
shipping company's largest vessels in a London port in violation
of a Chapter 11 automatic stay.

                     About Marco Polo Seatrade

Marco Polo Seatrade B.V. operates an international commercial
vessel management company that specializes in providing
commercial and technical vessel management services to third
parties.  Founded in 2005, the Company mainly operates under the
name of Seaarland Shipping Management and maintains corporate
headquarters in Amsterdam, the Netherlands.  The primary assets
consist of six tankers that are regularly employed in
international trade, and call upon ports worldwide.

Marco Polo and three affiliated entities filed for Chapter 11
protection (Bankr. S.D.N.Y. Lead Case No. 11-13634) on July 29,
2011.  The other affiliates are Seaarland Shipping Management
B.V.; Magellano Marine C.V.; and Cargoship Maritime B.V.

Marco Polo is the sole owner of Seaarland, which in turn is the
sole owner of Cargoship, and also holds a 5% stake in Magellano.
The remaining 95% stake in Magellano is owned by Amsterdam-based
Poule B.V., while another Amsterdam company, Falm International
Holding B.V. is the sole owner of Marco Polo.  Falm and Poule
didn't file bankruptcy petitions.

The filings were prompted after lender Credit Agricole Corporate
& Investment Bank seized one ship on July 21, 2011, and was on
the cusp of seizing two more on July 29.  The arrest of the
vessel was authorized by the U.K. Admiralty Court.  Credit
Agricole also attached a bank account with almost US$1.8 million
on July 29.  The Chapter 11 filing precluded the seizure of the
two other vessels.

Evan D. Flaschen, Esq., Robert G. Burns, Esq., and Andrew J.
Schoulder, Esq., at Bracewell & Giuliani LLP, serve as bankruptcy
counsel.  The cases are before Judge James M. Peck.  Kurtzman
Carson Consultants LLC serves as notice and claims agent.

The petition noted that the Debtors' assets and debt are both
more than US$100 million and less than US$500 million.

Tracy Hope Davis, United States Trustee for Region 2, appointed
three members to serve on the Official Committee of Unsecured
Creditors.  The Committee has retained Blank Rome LLP as its
attorney.

Secured lender Credit Agricole Corporate and Investment Bank is
represented by Alfred E. Yudes, Jr., Esq., and Jane Freeberg
Sarma, Esq., at Watson, Farley & Williams (New York) LLP.


MESENA CLO: Class A Notes' Rating Reflects 'CCC' Rated Assets
-------------------------------------------------------------
Standard & Poor's Ratings Services assigned its credit rating to
Mesena CLO 2011-1 B.V.'s EUR848.381 million class A senior-
secured floating-rate notes due 2026. At closing, Mesena CLO
2011-1 also issued unrated EUR375.246 million class B and
EUR407.875 class C deferrable-secured floating-rate notes, and
EUR84.978 class D notes -- all due 2026.

Mesena CLO 2011-1 is a collateralized debt obligation (CDO)
transaction that securitizes a pool of corporate loans originated
by Banco Espanol de Credito S.A. (AA/Negative/A-1+) in Holland.

The issuer is a private limited liability company incorporated
under Dutch law to issue the notes, acquire the collateral
portfolio, enter into transaction documents, and engage in
certain related transactions. It is based in Amsterdam. "In our
view, the transaction documents are consistent with our
bankruptcy-remoteness criteria (see 'European Legal Criteria For
Structured Finance Transactions,' published Aug. 28, 2008)," S&P
stated.

The main features of the transaction are:

    Deutsche Bank AG, London Branch (A+/Stable/A-1) is the
    transaction's payment account bank.

    Banco Espanol de Credito is the swap counterparty.

    The class A notes pay a coupon of three-month euro interbank
    offered rate plus 70 basis points, and at closing had a
    notional value of EUR783.121 million.

    The unrated notes totaled EUR783,121 million at closing --
    representing 48% of the pool balance.

    The structure benefits from a reserve fund, which was
    EUR81,575,072.64 at closing, representing 5% of credit
    enhancement in addition to subordination.

S&P's analysis indicated these key risks:

    "There is a high level of obligor concentration, which we
    believe makes the rated notes sensitive to idiosyncratic
    risk," S&P said.

    The interest rate swap counterparty's failure to perform
    could dent the transaction's performance, given the reliance
    for the timely payment of interest.

The 'AAA (sf)' rating S&P has assigned to Mesena CLO 2011-1's
class A notes reflects its assessment of:

    The credit enhancement provided by the subordination of cash
    flows that are payable to the subordinated notes and the
    reserve fund.

    "The rated tranche's ability to withstand the default of a
    combination of the largest obligors, assuming 5% recoveries,
    as per our latest criteria," S&P said.

    The rated tranche's ability to withstand the default of all
    obligors in the largest industry category, assuming 17%
    recoveries, as per S&P's latest criteria.

    The presence of structural features, such as haircuts to
    calculate the par value ratio for excesses above 5% for 'CCC'
    rated assets;

    The interest rate hedging mechanism; and

    The transaction's cash flow structure, which S&P assessed
    using assumptions and methods outlined in its CDO criteria
    (see "Update To Global Methodologies And Assumptions For
    Corporate Cash Flow And Synthetic CDOs, Sept. 17, 2009).

            Standard & Poor's 17g-7 Disclosure Report

SEC Rule 17g-7 requires an NRSRO, for any report accompanying a
credit rating relating to an asset-backed security as defined in
the Rule, to include a description of the representations,
warranties and enforcement mechanisms available to investors and
a description of how they differ from the representations,
warranties and enforcement mechanisms in issuances of similar
securities.

The Standard & Poor's 17g-7 Disclosure Report included in this
credit rating report is available at:

    http://standardandpoorsdisclosure-17g7.com/1111161.pdf

Ratings List

Mesena CLO 2011-1 B.V.
EUR1.716 Billion Floating-Rate Notes

Class        Rating         Amount (EUR)

A            AAA (sf)      848,381,000
B            NR            375,246,000
C            NR            407,875,000
D            NR             84,978,000

NR--Not rated.


SABIC INNOVATIVE: CCR Reflects 'bb' Stand-alone Credit Profile
--------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BBB+' long-term
corporate credit rating on Netherlands-based specialty plastics
producer SABIC Innovative Plastics Holding B.V. (SABIC IP). "We
also affirmed our issue ratings on the company's revolving credit
facility and term A and B loans. We subsequently withdrew all
ratings on SABIC IP. It is therefore no longer subject to
Standard & Poor's surveillance. The outlook on SABIC IP at the
time of withdrawal was stable," S&P stated.

The ratings withdrawal follows the redemption of US$975 million
of high-yield notes, which SABIC IP fully carried out on Aug. 15,
2011, thanks to a capital injection from the parent, 100% owner
Saudi chemical group Saudi Basic Industries (SABIC; A+/Stable/A-
1). This reflects SABIC's financial strategy of centralizing the
treasury and debt of its international affiliates at SABIC
Capital (not rated).

"The affirmation reflects our view of the absence of any
significant developments since our June 29, 2011, upgrade of
SABIC IP to 'BBB+'. The upgrade already factored in the
redemption of the notes," S&P noted.

"At the time of withdrawal, the rating on SABIC IP reflected our
assessment of its stand-alone credit profile (SACP) at 'bb', with
four notches of uplift from the SACP for extraordinary
shareholder support from SABIC. The rating on SABIC IP also took
into account our view of the company's 'fair' business risk
profile and 'significant' financial risk profile.  In our
opinion, the company's business risk is supported by its strong
global market position as one of the leading specialty plastic
producers, and EBITDA margins that improved strongly during 2010
and the first half of 2011. Relative weaknesses are significant
profit cyclicality, the deteriorated global macroeconomic
environment, and, especially, exposure to high benzene prices,"
S&P noted.

"Our view of SABIC IP's financial risk factored in substantial
deleveraging and our adjusted debt forecast at about US$2.6
billion, excluding shareholder loans, by the end of 2011. Under
normalized EBITDA assumptions, which are below 2010 peak EBITDA
of US$1.26 billion, we expect adjusted debt to EBITDA ratios to
average about 3x in coming years," S&P said.


===========
N O R W A Y
===========


SEVAN MARINE: Finds Bankruptcy Solution; Bondholder Talks Ongoing
-----------------------------------------------------------------
Stephen Treloar at Bloomberg News reports that Sevan Marine ASA
has approved a long-term solution presented to the company to
stave off bankruptcy.

The solution will include sustainable collaboration with a "large
industrial partner," Bloomberg quotes the company as saying in a
statement.  "The board believes it has found a good solution for
all parties.  The company will publish further information once
the agreement has been approved by all parties."

According to Bloomberg, the company on Thursday said in the
statement that the company requested the Oslo Stock Exchange
extend a suspension of its shares as it meets with stakeholders
for a negotiated settlement that may include a complete
restructuring of bond loans.

"There have been tense moments over the last 24 hours," Chairman
Jens Ulltveit-Moe, as cited by Bloomberg, said by phone on his
way to Thursday's board meeting.  "It could be very helpful for
the company to have a long-term industrial owner as opposed to
straight financial ones."

The company has struggled with larger-than-expected maintenance
costs on its Sevan Voyageur production and storage vessel, which
are expected to reach US$190 million, compared with an earlier
US$135 million forecast, Bloomberg discloses.

In a separate report, Bloomberg News' Mr. Treloar notes that
Sevan Marine Chairman Jens Ulltveit-Moe confirmed the company is
in talks with an industrial buyer regarding the sale of some of
the company's assets.  He declined to comment on who the buyer
was, Bloomberg states.

Mr. Treloar and Marianne Stigset at Bloomberg News, citing Dagens
Naeringsliv, report that Sevan Marine is in talks with an
industrial buyer to sell some of its assets and possibly
establish an industrial partnership.

Mr. Ulltveit-Moe told the Oslo-based newspaper that the potential
buyer is involved in the ongoing negotiations with stakeholders
and bondholders, Bloomberg recounts.

As reported by the Troubled Company Reporter-Europe on Sept. 9,
2011, Bloomberg News related that Mr. Ulltveit-Moe said the
company is preparing to file for bankruptcy as it engages in
last-minute negotiations with bondholders.  Dagens Naeringsliv,
citing Mr. Ulltveit-Moe, reported that Sevan's board gave
bondholders until 8 a.m. on Sept 28 to agree to restructure the
company's debt or warned it will file for bankruptcy.  It reached
an agreement in July with bondholders to defer interest payments
until the end of September and received a US$36.1 million bond
loan to support the company's working capital needs to allow it
time to present a solution to restructure debt, Bloomberg
recounted.  Sevan has a total interest-bearing debt of US$970
million, Bloomberg disclosed, citing the company's second-quarter
earnings report.

Sevan Marine ASA is a Norwegian maker of floating oil-production
and storage vessels.


STOREBRAND LIVFORSIKRING: Fitch Lifts Unsec. Debt Rating to 'BB'
----------------------------------------------------------------
Fitch Ratings has affirmed Norwegian life insurer Storebrand
Livforsikring's (SL) Insurer Financial Strength (IFS) rating at
'BBB+' and Issuer Default Rating (IDR) at 'BBB'.  At the same
time, Fitch has upgraded Storebrand ASA's (SA) Long-term IDR to
'BBB-' from 'BB+'. SA is SL's ultimate parent company.  The
Outlooks on the IFS rating and IDRs are Stable.  Fitch has also
affirmed SL's subordinated debt issues at 'BB+' and upgraded SA's
senior unsecured debt to 'BB+' from 'BB'.

The affirmation follows SL's solid operating results in 2010 and
H1 2011, strong capital adequacy supported by healthy buffer
reserves and the soundness of the Norwegian economy.  Offsetting
factors are SL's exposure to a low interest rate environment,
SPP's (SL's main subsidiary in Sweden; not rated) volatile
financial results, and low interest coverage at group
consolidated level.

The Stable Outlook reflects Fitch's expectation that the level of
buffer capital is likely to have protected SL's balance sheet
against financial market turmoil in Q311.  In its analysis, Fitch
has taken into account the fact that SL's ratings can, to some
extent, cope with downside risk related to a prolonged period of
low interest rates and increased market volatility.
Nevertheless, Fitch anticipates a reduced level of earnings from
policyholder profit-sharing mechanisms in H211, given the current
market dislocation and as SL continues to rebuild its buffer
capital.

The upgrade of SA's ratings reflects reduced pressure on group
earnings, given stronger buffer capital in SL and reduced strain
from SPP, which results in a higher run rate for the interest
coverage at the holding company level.  Notwithstanding Fitch's
expectation of a reduced level of earnings from profit-sharing
mechanisms in H211, the agency believes the run rate for the
interest coverage at the holding company level will continue to
support this return to standard notching between SL and SA.

An important positive rating factor for Norwegian life insurers
derives from the Insurance Act introduced in 2008, which reduces
interest rate risk borne by life insurance companies as it
requires life insurers to re-price annually interest rate risk
for existing defined-benefit plans.  Improved asset-liability
matching (ALM) in Sweden has also partly reduced the sensitivity
of earnings to interest rate movements.

Nevertheless, earnings in both Norway and Sweden remain subject
to investment returns being sufficient to cover profit-sharing
and minimum guaranteed rates.  In addition, Fitch notes that
exposure to a prolonged period of low interest rates would place
greater pressure on SL's investment income to match minimum
guaranteed returns and on SPP to accrue profit for the owner.

SL and SPP's exposures to equities remained relatively high in
2010 and 2011, and this could exert negative pressure on SL's
results given the increase in volatility in Q311.  However,
additional surplus capital generated in 2010 and maintained in
H111 should mitigate the impact of potential adverse market
movements on group solvency.

Based on the regulatory solvency position and on Fitch's own
risk-adjusted analysis, SL's capital adequacy is solid.  This
allows SL to have a higher risk appetite in seeking to achieve
higher expected returns in its profit-sharing portfolios.
However, Fitch notes the quality of capital is negatively
affected by the amount of goodwill.

Despite the improvement at the holding company level, the Fitch-
calculated interest coverage ratio for the consolidated group
remains relatively weak at around 3x (based on 2010 results),
although improving from a negative -0.9x in 2008 and 2.3x in
2009.

SL's ratings could be upgraded if the company manages to
strengthen on a sustainable basis its buffer capital through
additional statutory reserves to maintain an amount sufficient to
cover one year of minimum guarantees (around NOK6 billion).
Other factors leading to a possible upgrade would include reduced
sensitivity of earnings to changes in interest rates through
better ALM, in particular at SPP, and the achievement of the
targeted result before profit-sharing to more than NOK2.5 billion
by year-end 2013.

Conversely, the ratings could be downgraded if the exposure to
equities at SPP results in material losses to the extent that
SL's consolidated regulatory solvency margin falls below 130% or
shareholders' funds declined by more than 15% from NOK18.7
billion at end-June 2011 to below 2008 levels.  Also, failure to
mitigate over time SPP's financial volatility would exert
negative pressure on the ratings.

The ratings on the following SA senior unsecured debt issues were
upgraded to 'BB+' from 'BB':

  -- NOK405MM issued on March 13, 2009 at quarterly Nibor plus
     2.25% maturing in March 2012

  -- NOK550MM issued on June 23, 2009 at 7.15% maturing in
     July 2014 -- NOK550m issued on 22 October 2009 at 5.9%
     maturing in October 2014

  -- NOK200MM issued on March 19, 2010 at 5.0% maturing in March
     2013

  -- NOK400MM issued on March 19, 2010 at quarterly Nibor + 1.50%
     maturing in March 2013

A rating of 'BB+' was assigned to the following SA senior
unsecured debt issue:

  -- NOK1000MM issued on April 5, 2011 at quarterly Nibor plus
     1.80% maturing in April 5, 2016

The ratings on the following SL subordinated debt issues were
affirmed at 'BB+':

  -- NOK1,000MM issued on June 16, 2009 at 11.9% until June 2015;
     thereafter three-month Nibor plus 8.5%; callable in 2015 and
     perpetual

  -- NOK1,700MM issued on June 27, 2008 at quarterly Nibor plus
     3.5% until June 2014; thereafter three-month Nibor plus
     4.25%; callable in 2014 and perpetual

  -- EUR300MM issued on February 28, 2008 at 9.404% until June
     2013; thereafter three-month Euribor plus 6%; callable in
     2013 and perpetual

  -- NOK1,500MM issued on May 29, 2008 at quarterly Nibor plus 4%
     until May 2018; thereafter three-month Nibor plus 5%;
     callable in 2018 and perpetual


=========
S P A I N
=========


CAJA ESPANA: Moody's Reviews 'Ba1' Sub. Debt Rating for Upgrade
---------------------------------------------------------------
Moody's Investors Service has placed on review for possible
downgrade all ratings of Unicaja: the A1 long-term debt and
deposit ratings, the A2 subordinated debt rating and the C+ bank
financial strength rating (BFSR; mapping to A2 on the long-term
scale)). Moody's also placed Unicaja's Prime-1 short-term debt
and deposit ratings on review for possible downgrade. The Aa2
rating of Unicaja's government guaranteed debt remains on review
for possible downgrade.

At the same time, Moody's has placed on review for possible
upgrade all ratings of Caja Espana de Inversiones Salamanca y
Soria (CEISS): the Baa3 long-term debt and deposit ratings, the
Ba1 subordinated debt rating, the B2 preferred shares rating and
the D+ BFSR (mapping to a Ba1 on the long-term scale). Moody's
also placed CEISS' Prime-3 short-term debt and deposit ratings on
review for possible upgrade. The Aa2 rating of CEISS' government
guaranteed debt rated remains on review for possible downgrade.

Rating Rationale

The rating announcement reflects the approval by the assemblies
of both Unicaja and CEISS, on September 24 and 26, 2011,
respectively, to create a new commercial bank to which the two
savings banks will transfer all of their assets and liabilities
except the social welfare, which will remain in the savings
banks. The capital of the new bank will be owned by these savings
banks, 70% by Unicaja and 30% by CEISS.

Upon the completion of the transfer, the savings banks will no
longer conduct any type of banking activities and will only be
responsible for managing their social welfare projects, which
will be funded through the dividends paid by the new bank, and
assume responsibility as shareholders for the new bank. The new
commercial bank will be liable for all the debt obligations of
Unicaja and CEISS.

Moody's decision to place Unicaja's (total assets of EUR36.3
billion at end-June 2011) ratings on review for possible
downgrade is driven by Moody's concern that the combined entity
emerging after the integration with CEISS (total assets of
EUR44.2 billion at end-June 2011) is likely to have a weaker
credit profile than Unicaja's standalone credit strength. Moody's
also believes that the new group will have stronger financial
fundamentals relative to those currently displayed by CEISS. As
such, all of CEISS' ratings have been placed on review for
possible upgrade.

FOCUS OF THE REVIEW

Moody's rating review will focus on:

* An assessment of the expected losses embedded in the resulting
  entity's asset portfolios. This will provide a key input to the
  determination of the new entity's risk absorption capacity, its
  ability to withstand a deterioration in its loan book, and its
  capacity to generate capital through stressed core earnings and
  other capital-growth initiatives.

* The credit risk concentration (by borrower and industry) as a
  percentage of Tier-1 and pre-provision income of the combined
  entity.

* The ability of the new entity to address debt maturities in
  light of the ongoing system-wide constraints in terms of
  accessing the capital markets for long-term funding.

* The pro-forma risk-adjusted recurring profitability and cost
  efficiency indicators of the combined entity.

* The combined entity's corporate governance (i.e., related-party
  lending as a percentage of its Tier-1 capital).

In addition, Moody's notes that the integration might also pose
challenges in terms of managerial capabilities and resources,
which could result in a more protracted integration process, also
taking into account the very recent merger of Caja Espana and
Caja Duero effective since October 1, 2010 to form CEISS.

Principal Methodology

The methodologies used in this rating were Bank Financial
Strength Ratings: Global Methodology published in February 2007,
Incorporation of Joint-Default Analysis into Moody's Bank
Ratings: A Refined Methodology published in March 2007 and
Moody's Guidelines for Rating Bank Hybrid Securities and
Subordinated Debt published in November 2009.

Headquartered in Malaga, Spain, Unicaja reported total
consolidated assets of EUR36.3 billion as of June 30, 2011.

Headquartered in Leon, Spain, CEISS reported total consolidated
assets of EUR44.2 billion as of June 30, 2011.


TELEFONICA FINANCE: Fitch Lowers Rating on Pref. Shares to 'BB+'
----------------------------------------------------------------
Fitch Ratings has downgraded Telefonica SA's and its subsidiary
O2's Long-term Issuer Default Ratings (IDRs) to 'BBB+' from 'A-'.
At the same time, the agency has downgraded the senior unsecured
rating of the bonds issued by Telefonica Europe BV to 'BBB+' and
Telefonica Finance USA LLC's preference shares to 'BB+'.  The
agency has affirmed Telefonica's Short-term IDR s at 'F2'.  The
Outlooks on the IDRs are Stable.

"The combination of the EUR7.5bn cash price paid for Vivo, the
impact of economic conditions and the public targets set for
dividends per share (DPS), suggest that Telefonica's leverage
will remain elevated for sometime.  Both at end-2010 and at end-
H111, leverage adjusted for commitments was 2.5x.  Fitch expects
it will remain at or close to this level through 2012," says
Stuart Reid, a Senior Director in Fitch's European TMT team.
"Most 'A-' rated incumbents have unadjusted leverage close to
2.0x.  Fitch considers a metric for Telefonica towards the lower
end of its public target of 2.0x-2.5x of net debt plus
commitments to EBITDA as commensurate with a 'A- 'rating and at a
minimum a metric towards the mid-point of this range," Mr. Reid
continued.

Telefonica is unlikely to be able to reduce capex over the coming
years. Spectrum acquisition continues to weigh on investment
plans - notably the auction in the UK expected in 2012, and in
Latin America and Spain in 2011.  The company has publicly stated
its commitment to network investment in Latin America.  In
Fitch's view, this is significant, given the competitive
environment in markets like Brazil where market growth in both
mobile and fixed broadband remains available for those operators
with the best network quality.

While the company continues to deliver growth in Europe and Latin
America, its European businesses are likely to be affected by
growing economic uncertainties.  The domestic Spanish operations
have exhibited material negative growth and are likely to
continue to do so given the economic environment and in
particular one of the highest rates of unemployment in the euro
zone.

While pre-dividend free cash flow is expected to remain
relatively strong in Fitch's rating case, (FCF margin to revenues
close to 15% when excluding spectrum acquisition), the company's
tendency to commit to forward-looking DPS targets provides little
scope for distributions to be adjusted to suit other pressures in
the cash flow statement.  Limited scope to adjust either capex
budgets or dividend plans, therefore remove two of the principle
levers usually available to incumbent operators where cash flow
and leverage metrics are otherwise under pressure.

The Stable Outlook reflects that Telefonica's financial metrics
are more comfortably in line with the 'BBB+' peer group, with
unadjusted leverage of 2.4x-2.5x consistent for an incumbent with
Telefonica's breadth and business diversification.  Free cash
flow margin on a pre-dividend, pre-spectrum acquisition basis,
approaching 15% is considered relatively strong, while FFO net
leverage around 3.0x in line with the 'BBB' category peer group.

The three-notch differential between the IDR and the instrument
rating of the preference shares remains unchanged and is in line
with Fitch's methodology on hybrid instruments.


===========================
U N I T E D   K I N G D O M
===========================


ALEXON GROUP: Sun European Partners Emerges as Leading Bidder
-------------------------------------------------------------
Claer Barrett and Andrea Felsted at The Financial Times report
that private equity firm Sun European Partners has emerged as the
front-runner to acquire distressed Alexon Group.

Alexon put itself up for sale earlier this month after a 9% drop
in sales in August prompted its third profit warning in six
months, the FT recounts.  It appointed KPMG to run an accelerated
M&A process after net debts ballooned to GBP15 million, more than
its current market capitalization of GBP4 million, the FT
discloses.

According to the FT, people familiar with the situation said that
the rapid deterioration in trade and inability to raise further
equity from its shareholders meant that Alexon's lender Barclays
was unable to extend the size of its banking facility.  This
meant the retailer would be unable to pay the quarterly rent bill
on its shops, which falls due this week, the FT states.

For retailers with cash flow problems, quarter days -- when three
months' rent must be paid to shop landlords in advance -- are
often the tipping point into insolvency, the FT notes.

Debenhams, the FT says, is understood to have expressed interest
in acquiring some of the fashion brands, but not the whole group.

Alexon Group plc is a United Kingdom-based women's fashion
retailer.


* UK: Alex Salmond's Green Energy Revolution May Bankrupt Firms
---------------------------------------------------------------
Simon Johnson at The Telegraph reports that business leaders have
warned the First Minister that the costs of Alex Salmond's green
energy revolution are "going through the roof" and threaten to
bankrupt companies by doubling energy bills.

According to the Telegraph, the Scottish Chambers of Commerce
said electricity is currently about nine times more expensive to
generate from wind farms than gas-powered plants.

Mike Salter, the SCC chairman, told the organization's annual
dinner that Government energy experts predict greater reliance on
"very expensive" renewables will lead to consumers' electricity
bills doubling, the Telegraph relates.

He warned this would hold back the Scottish economy and lead to
businesses going under, the Telegraph notes.

In a double whammy for hard-pressed companies, he said the SNP's
decision to increase business taxes by GBP849 million threatens
to "suck the life" from the economy, the Telegraph recounts.


* UK: Insolvency Now a Last Resort, Property Expert Says
--------------------------------------------------------
Yorkshire Evening Post reports that insolvency has become a last
resort in the area of property debt in the U.K.

According to the report, Mark Swiers, partner for corporate
services at chartered surveyors and property consultants
Sanderson Weatherall in Leeds, told a regional meeting of the
Association of Business Recovery Professionals, R3, that despite
property debt in Yorkshire growing, there has been less
insolvency.

"Whilst the manufacturing sector was probably in the worst
trouble during the '90s recession, property-related debt has hit
the headlines this time round," the report quotes Mr. Swiers as
saying.

"Failed residential schemes, fuelled by easy credit and often
managed by amateur investors, are just one example of how
unbridled property debt had escalated."

Yorkshire Evening Post relates that Mr. Swiers added, "Whilst
banks were readily inclined towards formal insolvency processes
during the 1990s, my experience was that they were generally
unprepared.

"Today, they're adept at spotting early signs of financial
distress and attempt to help companies work through financial
obstacles via in-house specialist departments," Mr. Swiers said.

"Insolvency is no longer the only option for property-related
debt. The banks have devised a range of strategies as
alternatives to include holding stock, debt forgiveness and debt
for equity swaps," he added.


===============
X X X X X X X X
===============


* BOOK REVIEW: Learning Leadership
----------------------------------
Author: Abraham Zaleznik
Publisher: Beard Books
Hardcover: 548 pages
Listprice: $34.95
Review by Henry Berry

The lesson in Learning Leadership -- The Abuse of Power in
Organizations is to "use power so that substance leads process."
This is done, says the author, by keeping the "content of work at
the center of communication."

The premise of this intriguing book is that many managers,
executives, and other business leaders allow "forms of
communication [to become] the center of work."  As a result,
misguided and counterproductive leadership and management
practices have settled into many organizations.  A culprit is the
popular "how-to" leadership manuals that offer simple,
superficial principles that only skim the surface of leadership.
Zaleznik argues that the primary way to get work done is to put
aside personal agendas and deal directly with those who are
involved in the work.

With this emphasis on substance over process, the concept of
leadership lies not in techniques, but personal qualities.  The
essential personal qualities of leadership are captured by the
"three C's" of competence, character, and compassion.  The author
then delves more deeply into each of these C's.  We learn, for
example, that the three C's are not learned skills.  Competence
entails "building one's power base on talent."

Character and compassion are the two other qualities of a leader
that must be present before there is any talk about methods of
operation, lines of communication, definition of goals, structure
of a team, and the like.  There is more to character that the
common definition of the "quality of the person."  Character also
embraces, says the author, the "code of ethics that prevents the
corruption of power."  Compassion is defined as a "commitment to
use power for the benefit of others, where greed has no place."
This concept of a good leader is not idealized or unrealistic.
It takes into account human nature and the troubling behavior of
many leaders.  Of course, any position of leadership brings with
it temptations and the potential to abuse power.  Effective
leaders are those who "take responsibility for [their] own
neurotic proclivities," says the author.  They do this out of a
sense of the true purpose of leadership, which is communal
benefit.  The power holder will "avoid the treacheries of an
unreasonable sense of guilt, while recognizing the omnipresence
of unconscious motivation."

Zaleznik's definition of the essentials of leadership comes from
his study of notable (and sometime notorious) leaders.  Some
tales are cautionary.  The Fashion Shoe Company illustrates the
problems that can occur when a leader allows action to overcome
thought.  The Brandon Corporation illustrates the opposite
leadership failing -- allowing thought to inhibit action. Taken
together, the two examples suggest that balance is needed for
good leadership.  Andrew Carnegie exemplifies the struggle
between charisma and guilt that affects some leaders.  Frederick
Winslow Taylor is seen by the author as an obsessed leader.  From
his behavior in the Sicilian campaign in World War II, General
Patton is characterized as a leader who violated the code binding
leaders and those they lead.

With his training in psychoanalysis and his experience in the
business field, Zaleznik's leadership dissections and discussions
are instructive.  The reader will find Learning Leadership -- The
Abuse of Power in Organizations to be an engaging text on the
human qualities and frailties of leaders.

Abraham Zaleznik is emeritus Konosuke Matsushita Professor of
Leadership at the Harvard Business School.  He is also a
certified psychoanalyst.


                            *********

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, Ivy B.
Magdadaro, Frauline S. Abangan and Peter A. Chapman, Editors.

Copyright 2011.  All rights reserved.  ISSN 1529-2754.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.

Information contained herein is obtained from sources believed to
be reliable, but is not guaranteed.

The TCR Europe subscription rate is US$625 per half-year,
delivered via e-mail.  Additional e-mail subscriptions for
members of the same firm for the term of the initial subscription
or balance thereof are US$25 each.  For subscription information,
contact Christopher Beard at 240/629-3300.


                 * * * End of Transmission * * *