/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/120914.mbx T R O U B L E D C O M P A N Y R E P O R T E R E U R O P E Friday, September 14, 2012, Vol. 13, No. 184 Headlines C Y P R U S CYPRUS POPULAR: Commission Temporarily Approves Recapitalization F R A N C E CREDIT IMMOBILIER: Can't Refinance Due to Unjustified Ratings SOCIETE NATIONALE: 2006 Bailout Manifests Assessment Error G E R M A N Y SOLARWATT AG: Creditors Back Reorganization Plan TECHEM ENERGY: Moody's Assigns 'B1' Corporate Family Rating TECHEM GMBH: S&P Assigns 'B+/B' Corporate Credit Ratings WINDERMERE VII: Moody's Lowers Rating on Class D Notes to 'Caa3' I R E L A N D OMEGA CAPITAL: S&P Reinstates 'B' Ratings on Two Note Classes I T A L Y SEAT PAGINEGIALLE: S&P Raises Corporate Credit Rating to 'CCC' SOPAF: UniCredit Wants to Commence Insolvency Proceedings M A L T A ST. PHILIP'S HOSPITAL: Owes Around EUR12 Million to Creditors R U S S I A VNESHECONOMBANK: S&P Assesses Stand-Alone Credit Profile at 'bb' U N I T E D K I N G D O M DIXONS RETAIL: Moody's Rates GBP150MM Sr. Unsecured Notes 'B1' ENPURE: Enters Administration, Ends Seawage Project GKN HOLDINGS: S&P Assigns 'BB+' Rating to Euro Medium-Term Note * Restructuring Vet Yushan Ng Joins Cadwalader's London Office X X X X X X X X * Moody's Says EMEA Spec-Grade Cos. Have Weak Liquidity Profile * BOOK REVIEW: Ralph H. Kilmann's Beyond the Quick Fix ********* =========== C Y P R U S =========== CYPRUS POPULAR: Commission Temporarily Approves Recapitalization ---------------------------------------------------------------- The European Commission has temporarily approved a rescue recapitalization worth EUR1.8 billion that Cyprus granted to Cyprus Popular Bank for reasons of financial stability. The Commission found the measure to be in line with EU state aid rules because it is limited to the minimum necessary and provides safeguards to minimize distortions of competition. The public support measure is approved for a period of six months. The Cypriot authorities committed to submit a restructuring plan for the bank within this period. The Commission will then take a final decision on the basis of the restructuring plan. To meet capital requirements from the European Banking Authority (EBA), Cyprus Popular Bank issued new shares for EUR1.8 billion, which Cyprus underwrote in May 2012. In essence, Cyprus committed to acquire any new shares not purchased by the general public or existing shareholders. As by the end of June 2012, private investors had subscribed only to negligible amounts of the offered shares, the State acquired them and thereby became the majority shareholder of the bank. The State paid the bank by transferring it a 12-month sovereign bond, which will be rolled over during five years. Background The Commission found that the measure complied with the criteria laid down in its guidance on emergency recapitalization aid. In particular, the shares issued are part of the bank's action to overcome the capital shortfall to meet end June 2012 EBA's requirements, the total of which was estimated at EUR2.5 billion. Cyprus Popular Bank is the second largest banking institution in Cyprus and a default or technical insolvency would create a serious disturbance to the economy of Cyprus. The Commission also found that the new shares were issued at a sufficiently low price so as to minimize distortions of competition in the internal market. The Cypriot authorities committed to submit a restructuring plan within six months, from the decision, in order to demonstrate how Cyprus Popular Bank will be viable without continues state support. The Commission will take a final decision on the recapitalization in the context of the assessment of the bank's restructuring plan. Cyprus Popular Bank (formerly known as Marfin Popular Bank) is the second largest banking group in Cyprus behind the Bank of Cyprus. =========== F R A N C E =========== CREDIT IMMOBILIER: Can't Refinance Due to Unjustified Ratings ------------------------------------------------------------- David Whitehouse at Bloomberg News reports that former chief executive officer of Credit Immobilier de France Claude Sadoun told Le Figaro that the bank is healthy and profitable. According to Bloomberg, Mr. Sadoun told the newspaper CIF can't refinance itself on the markets because of unjustified ratings action by Moody's. Mr. Sadoun said in the interview that CIF could still be taken under the umbrella of a public organization, Bloomberg relates. State Guarantee As reported by the Troubled Company Reporter-Europe on Sept. 03, 2012, Reuters related that the French government said it agreed to rescue Credit Immobilier de France after a fruitless search for a buyer for the lender, which faced a liquidity crisis. CIF had been up for sale since at least May after its future was thrown into doubt by the evaporation of once-cheap funding from credit markets, on which it depends to finance its operations, Reuters recounted. Mr. Moscovici, as cited by Reuters, said that the state guarantee to CIF, facing the expiration of a EUR1.75 billion covered bond in early October, was subject to approval by the European Commission. The government, which said CIF's business model had been weakened by incoming tougher bank capital ratios, did not say whether it would still seek a buyer or try to wind down the group, Reuters noted. Moody's Downgrade As reported by the Troubled Company Reporter-Europe on May 21, 2012, Moody's Investors Service downgraded the standalone bank financial strength (BFSR) of Caisse Centrale du Credit Immobilier de France (3CIF) to E/caa1, outlook developing, from C/a3 on review for downgrade. Moody's decision to downgrade 3CIF's BFSR to E/caa1 from C/a3 is based on the rating agency's assessment that the bank is no longer viable without ongoing financial support and ultimately a more durable solution. Credit Immobilier de France is a mortgage provider. It has 300 branches in France and about 2,500 employees. SOCIETE NATIONALE: 2006 Bailout Manifests Assessment Error ---------------------------------------------------------- William Dotinga at Courthouse News Service reports that the EU General Court ruled European lawmakers "committed a manifest error of assessment" in letting France bail out a shipping company with about US$330 million. France-owned Compagnie generale maritime et financiere (CGMF) gave the Societe Nationale Corse-Mediterranee (SNCM) a US$91 million bailout in 2002, and the European Commission approved that measure six years later, CNS recounts. The commission also approved a 2006 privatization plan for SNCM, which included a capital infusion of US$246 million from the French government, CNS notes. The General Court of the European Union called the commission's decision to approve SNCM's 2006 recapitalization "a manifest error of assessment" on Tuesday, CNS relates. To determine whether the recapitalization constituted state aid, regulators had to find that a private investor would have also chosen to make SNCM more attractive with a US$246 million investment, rather than liquidate the company, CNS discloses. According to CNS, the European Commission told the court that the hypothetical cost of liquidating SNCM, compared with the capital infusion it approved, was "limited to the cost of additional redundancy payments, going beyond the strict legal and contractual obligations, which would have had to have been paid to employees," according to the court. Societe Nationale Corse-Mediterranee is a French shipping company. ============= G E R M A N Y ============= SOLARWATT AG: Creditors Back Reorganization Plan ------------------------------------------------ Solar Industry reports that Solarwatt AG says its creditors have voted in favor of a reorganization plan put forth by the company and restructuring experts from Salans LLP. Following the vote, the local district court in Dresden officially confirmed the reorganization plan, Solar Industry relates. Solarwatt has been undergoing insolvency proceedings since June 13, and the company says that now that it has earned creditors' approval, the largest barrier to the restructuring has been overcome, Solar Industry notes. According to Solar Industry, the reorganization plan includes substantial restructuring contributions from all Solarwatt creditors. Unsubordinated, unsecured creditors in the insolvency, especially suppliers and bond holders of Solarwatt AG, will receive 16% of their registered and verified outstanding claims just four weeks after the plan takes legal effect, Solar Industry discloses. Entrepreneur Stefan Quandt will become the new anchor investor of Solarwatt AG, Solar Industry states. The share capital of the company that will have been reduced to zero will then be raised up to a total of EUR5 million through a capital increase, Solar Industry says. Following the capital increase, Quandt will hold 94% of the company's capital via his holding company AQTON SE, Solar Industry discloses. Furthermore, Quandt will also issue a shareholder loan in the amount of EUR5 million, according to Solar Industry. Solarwatt AG is a Germany-based crystalline solar module manufacturer. TECHEM ENERGY: Moody's Assigns 'B1' Corporate Family Rating ----------------------------------------------------------- Moody's Investors Service assigned a B1 corporate family rating (CFR) and a B1 probability of default rating (PDR) to Techem Energy Metering Service GmbH & Co. KG ("TEMS", "Techem"). At the same time Moody's has assigned a provisional (P)Ba3 instrument rating with an LGD3 37% to Techem's announced EUR410 million senior secured notes raised at the level of Techem GmbH, a subsidiary of Techem Energy Metering Service GmbH & Co. KG and a provisional (P)B3 rating with an LGD6 90% to the EUR325 million senior subordinated notes issued by Techem Energy Metering Service GmbH & Co. KG. The outlook on the ratings is stable. Moody's issues provisional ratings for debt instruments in advance of the final sale of securities or conclusion of credit agreements. Upon a conclusive review of the final documentation, Moody's will endeavor to assign a definitive rating to the different capital instruments. A definitive rating may differ from a provisional rating. Assignments: Issuer: Techem Energy Metering Service GmbH & Co. KG Probability of Default Rating, Assigned B1 Corporate Family Rating, Assigned B1 Senior Subordinated Regular Bond/Debenture, Assigned (P)B3 Issuer: Techem GmbH Senior Secured Regular Bond/Debenture, Assigned (P)Ba3 Ratings Rationale The B1 CFR and PDR ratings reflect: i) Techem's high profitability levels with a reported EBITDA-margin of 31% in FY2011/12 supported by the group's high market penetration, particularly in Germany, ii) good revenue visibility and stability driven by the non-discretionary nature of demand and long-term contracts with a typical duration of contracts of 5-10 years in Energy Services and 10-15 years in Energy Contracting, iii) high entry barriers and low net churn rates below 5%, as well as iv) a supportive regulatory environment and focus on energy efficiency. These positive factors are offset by (i) the group's high leverage with a Moody's adjusted debt/ EBITDA of 7.3x in FY2011/12 (5.3x when normalized for losses of EUR81 million on interest rate SWAPS), (ii) limited ability to deleverage due to relatively high interest payments, capex requirements and dividend payments, and (iii) the challenge to successfully transform the energy contracting business into a growth business after the end of ecotax legislation in Germany, when tax reimbursements had been cut and Techem discontinued the tax efficiency contracting product. The stable outlook reflects the good level of revenue visibility and Moody's expectation of a stable operating performance in the mid-term. It also incorporates the assumption that Techem achieves a Moody's adjusted leverage of around 5.5x debt/ EBITDA in the current financial year and is able to maintain a satisfactory liquidity profile. Given the expectation of continuous dividend payments and the stability of the business Moody's does not expect a meaningful deleveraging going forward. Techem's B1 rating could be upgraded if both Moody's adjusted Debt/ EBITDA remains below 5.5x and FCF/ debt improves to at least 5% on a sustainable basis. Techem's rating could come under pressure if Moody's adjusted Debt/ EBITDA ratio increases sustainably above 6.0x and/or the adjusted EBIT/ interest ratio weakens below 1.2x. Also double digit negative free cash flow (after dividend payments) in any financial year with no signs of improvement could put pressure on the rating. Liquidity Following the re-financing Moody's believes that Techem will have an adequate liquidity. This assessment is supported by a high cash balance of EUR72 million as of 31 March 2012, sufficient availability under the new revolving credit facilities (EUR50 million for working capital needs, EUR50 million for capital expenditures) as well as a stable ongoing cash flow generation. Furthermore Moody's takes into account the seasonality of cash collection during the year as well as cash outflows for dividend payments. Moody's also assumes a sustained comfortable headroom under the financial covenants agreed in the new financing contracts. Structural Considerations The senior secured notes which will be issued by Techem GmbH are guaranteed by the parent, Techem Energy Metering Service GmbH & Co. KG and certain operating subsidiaries. Guarantors will represent at least 85% of the group's EBITDA and consolidated gross assets, respectively. The senior secured notes, senior secured bank facilities and hedging facilities rank pari passu with each other and are secured by share pledges, intercompany receivables and holding accounts. The senior subordinated notes which will be issued by Techem Energy Metering Service GmbH & Co. KG are unconditionally guaranteed on a senior subordinated basis by Techem GmbH and certain operating subsidiaries. Guarantors will represent at least 85% of the group's EBITDA and consolidated gross assets, respectively. The senior subordinated notes are secured by a second-priority pledge over shares and intercompany accounts and rank behind senior secured notes and senior secured bank facilities. In Moody's analysis of the priority of claims within the suggested capital structure the senior secured notes (approx. EUR410 million) and senior secured bank facilities (approx. EUR550 million) as well as trade payables, operating lease obligations and unfunded pension obligations rank prior to the senior subordinated notes (approx. EUR325 million). As a result of Moody's Loss given Default analysis the senior secured notes are rated one notch above the corporate family rating. The senior subordinated notes are rated two notches below the corporate family rating given their claims contractually ranking behind the senior secured notes and senior secured bank facilities in a default scenario. The principal methodology used in rating Techem Energy Metering Service GmbH & Co KG and Techem GmbH was the Global Business & Consumer Service Industry Rating Methodology published in October 2010. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Headquartered in Eschborn (Germany), Techem is a leading provider of energy services which operates through two divisions: Energy Services (around 90% of EBITDA in FY2011/12) provides sub- metering of heating use and water consumption for individual housing units and ancillary services. Energy Contracting (around 10% of EBITDA in FY2011/12) offers a holistic management of the client's energy consumption through the planning, financing, construction and operation of heat stations, boilers, cooling equipment and combined heating and power units, including from time to time delivery of primary energy. In FY2011/12 Techem group had revenues of EUR692.9 million and thereof around 80% were generated in Germany. TECHEM GMBH: S&P Assigns 'B+/B' Corporate Credit Ratings -------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B+/B' long- and short-term corporate credit ratings to German energy services company Techem GmbH. The outlook is stable. "At the same time, we assigned our 'B+' issue rating and '3' recovery rating on Techem's proposed senior secured credit facilities and senior secured notes, and our 'B-' issue rating and '6' recovery rating on the proposed senior subordinated notes issued by related entity Techem Energy Metering Service GmbH & Co. KG," S&P said. "The ratings on Techem balance our view of the group's leading market position in the German energy heat and water sub-metering industry with our assessment of Techem's financial risk profile as 'highly leveraged.' Our assessment reflects the group's weak cash flow adequacy and credit metrics, and what we see as its aggressive financial policies. This is partly offset by Techem's 'adequate' liquidity profile due to low capital expenditures (capex) and the presence of committed back-up credit lines," S&P said. "We understand that Techem is planning to refinance its existing loan portfolio, mainly comprising bank debt, with bonds. The group is contemplating issuing a EUR410 million secured bond and a EUR325 million subordinated bond. It plans to complement this with a rollover of EUR450 million of an existing secured loan. In addition, the group is financed by a shareholder loan, for which the balance was EUR413 million at financial year-end March 31, 2012," S&P said. "In our view, Techem's core German heat and water sub-metering operations will continue to generate adequate cash flow to enable the group to deleverage moderately and sustain or improve its credit metrics. That said, we anticipate that the group will pay any excess cash it generates to shareholders to the extent that the loan document allows. We also anticipate that the group will contain its expansion into lower-margin energy contracting services and less stable international energy services, and that its core heat and water sub-metering business will remain the main contributor to earnings and cash flow over the medium term. We further assume that Techem will maintain an 'adequate' liquidity profile, as our criteria define this term," S&P said. "We could consider lowering the rating if Techem's liquidity weakens substantially, or if revenue and EBITDA growth falls significantly below our expectations, preventing Techem from deleveraging. Similarly, we could consider lowering the ratings if free cash flow generation falls significantly below our expectations," S&P said. "We believe that upside is limited over the next 12 months because the rating already takes into account the continued and resilient growth in revenues and EBITDA that we anticipate during this period. In addition, we believe that Techem's rather limited size and scope limits rating upside. However, we could contemplate raising the rating if Techem reports vastly improved credit ratios, but we consider this scenario to be remote at this stage," S&P said. WINDERMERE VII: Moody's Lowers Rating on Class D Notes to 'Caa3' ---------------------------------------------------------------- Moody's Investors Service has taken a rating action on the following classes of Notes issued by Windermere VII CMBS plc (amounts reflect initial outstanding): EUR466M Class A2 Notes, Affirmed at Aa3 (sf); previously on Aug 4, 2011 Downgraded to Aa3 (sf) EUR50M Class B Notes, Affirmed at A2 (sf); previously on Sep 23, 2009 Confirmed at A2 (sf) EUR27.4M Class C Notes, Downgraded to Ba3 (sf); previously on Sep 23, 2009 Confirmed at Baa3 (sf) EUR50.8M Class D Notes, Downgraded to Caa3 (sf); previously on Sep 23, 2009 Confirmed at B1 (sf) EUR0.05M Class X Notes, Affirmed at Ba3 (sf); previously on Aug 22, 2012 Downgraded to Ba3 (sf) Moody's does not rate the Class E and Class F Notes. Ratings Rationale The downgrade action on the Class C and D Notes reflects Moody's increased loss expectation for the pool since its last review. This is primarily due to 56% of the portfolio suffering an actual or imminent maturity payment default and a decline in value for a number of the properties and property portfolio securing the loans. The rating on the Class A and B Notes is affirmed because their current credit enhancement level of 36% and 25.5% respectively is sufficient to maintain their ratings despite the increased loss expectation for the pool. The Class A Notes benefit from sequential payment of principal proceeds since the sequential payment trigger was breached in January 2012. The key parameters in Moody's analysis are the default probability of the securitized loans (both during the term and at maturity) as well as Moody's value assessment for the properties securing these loans. Moody's derives from those parameters a loss expectation for the securitized pool. Based on Moody's reassessment of the underlying property values, the pool's weighted-average (WA) securitized loan LTV ratio is 103% and on a whole loan basis it is 109%. This compares with the prior review WA LTV of 84% on the securitized pool and 88% on a whole loan basis. In Moody's view, the value re-assessment is justified by i) the upward yield pressure for secondary properties in Europe and ii) the adverse lease rollover profile for a number of the loans. Five of the nine loans were in special servicing as of the July 2012 IPD representing 55.7% of the pool. Of the loans in special servicing: (i) The Adductor and Corpus loans failed to repay on their maturity date in July 2012; (ii) the Mulheim loan failed to repay on its maturity date in January 2011; (iii) the Nordostpark loan has a LTV covenant breach with U/W whole loan LTV of 131%, Moody's expects this loan to default on its maturity date in October 2012; and (iv) the Redleaf I loan has been in special servicing since September 2009 and also two of the three facilities under the loan are in maturity default. Moody's models all five of these as defaulted loans and further expects the Redleaf II to default at its maturity date in February 2013. Moody's expects losses on these loans, ranging from 0-25% on Adductor and Corpus, 25-50% on Mulheim, Nordostpark and Redleaf II and 50-75% on Redleaf I. The Nitsba loan matured in July 2012 and was given a six month extension until January 2013 to facilitate the sale of the underlying properties which according to the servicer is expected result in the full repayment of the loan. Moody's has also assigned a high probability to this loan repaying. The remaining pool's weighted average expected loss will increase if the Nitsba loan repays since this loan has a very low expected loss and it is also the largest loan in the pool. This increase in expected loss is however mitigated by the further increase in credit enhancement for the senior and mezzanine Classes that would result from the Nitsba loan's repayment. In general, Moody's analysis reflects a forward-looking view of the likely range of commercial real estate collateral performance over the medium term. From time to time, Moody's may, if warranted, change these expectations. Performance that falls outside an acceptable range of the key parameters such as property value or loan refinancing probability for instance, may indicate that the collateral's credit quality is stronger or weaker than Moody's had anticipated when the related securities ratings were issued. Even so, a deviation from the expected range will not necessarily result in a rating action nor does performance within expectations preclude such actions. There may be mitigating or offsetting factors to an improvement or decline in collateral performance, such as increased subordination levels due to amortization and loan re- prepayments or a decline in subordination due to realized losses. Primary sources of assumption uncertainty are the current stressed macro-economic environment and continued weakness in the occupational and lending markets. Moody's anticipates (i) delayed recovery in the lending market persisting through 2013, while remaining subject to strict underwriting criteria and heavily dependent on the underlying property quality, (ii) strong differentiation between prime and secondary properties, with further value declines expected for non-prime properties, and (iii) occupational markets will remain under pressure in the short term and will only slowly recover in the medium term in line with anticipated economic recovery. Overall, Moody's central global macroeconomic scenario is for a material slowdown in growth in 2012 for most of the world's largest economies fuelled by fiscal consolidation efforts, household and banking sector deleveraging and persistently high unemployment levels. Moody's expects a mild recession in the Euro area. As the Euro area crisis continues, the rating of the structured finance notes remain exposed to the uncertainties of credit conditions in the general economy. The deteriorating creditworthiness of euro area sovereigns as well as the weakening credit profile of the global banking sector could negatively impact the ratings of the notes. Furthermore, as discussed in Moody's special report "Rating Euro Area Governments Through Extraordinary Times -- An Updated Summary," published in October 2011, Moody's is considering reintroducing individual country ceilings for some or all euro area members, which could affect further the maximum structured finance rating achievable in those countries. Moody's Portfolio Analysis Windermere VII CMBS plc closed in May 2006 and represents the securitization of initially twelve mortgage loans originated by Lehman Commercial Paper Inc and secured by first-ranking legal mortgages over initially 72 commercial properties located in Germany (60.1% of the original pool), France (17.3%), Sweden (17.5%) and Spain (5.1%). Currently nine loans remain in the pool which are secured by mortgages over 55 properties. The pool exhibits a below average concentration in terms of geographic location and property type. By property value, 54% of the properties are in Germany, 39% in France and 7% in Spain and in terms of type, 45% are office properties, 48% are multifamily with some mixed use component and 7% are retail properties. Moody's uses a variation of Herf to measure diversity of loan size, where a higher number represents greater diversity. Large multi-borrower transactions typically have a Herf of less than 10 with an average of around 5. This pool has a Herf of 7.9, lower than at Moody's prior review. As of the July 2012 reporting, the transaction's total pool balance was EUR322.3 million, down 59% since closing mainly due to the repayment of the Darmstadt loan in April 2007, the Hanseatic loan in April 2010 and the Tornet loan in September 2011. There has also been some partial prepayments and amortization on the remaining loans. The Nitsba loan is the largest loan representing 18.7% of the pool. The loan is secured by 8 secondary quality office properties located throughout France. Two of the eight properties are vacant and with respect to the remainder, France Telekom provides 90% of the rental income and the weighted average lease remaining is 5.5 years. The loan benefits from sponsor support and a low leverage with U/W LTV of 45% (there is no B-loan). As mentioned above the loan has been granted a six month extension since the servicer expects full repayment of the loan through the disposal of some of the assets. The Moody's LTV is 72% and Moody's also expects this loan to repay within the next few quarters. Adductor is the second largest loan representing 15% of the pool. The loan is secured by 13 office properties in France with 52% by value located in Nice, 18% in Marseille, 14% in Valbonne, 12% in Aix en Provence and 4% in Lyon. The weighted average remaining lease term is only 2 years. Moody's securitized LTV is 81% (there is no B-loan). The loan failed to repay on its maturity date in July 2012. The Nordostpark (13.5%) and the Mulheim (6.4%) loans are both secured by a single office property in Germany and both are single let with a short weighted average remaining lease term. The Nordostpark property is let to Alcatel-Lucent for another 2.5 years and the Mulheim loan is let to Deutsche Telekom for another three years. In both cases there is a high probability that the tenant will vacate at maturity and as a result both properties have suffered a substantial value decline since closing, 47% for Nordostpark and 37% for Mulheim. The current U/W securitized loan LTV for the Nordostpark property is 101% (whole loan LTV is 131%) and 117% for Mulheim. Moody's whole loan LTV is 164% for the Nordostpark property and 146% for the Mulheim property. The Mulheim failed to repay on its maturity date in January 2011 and Moody's expects the Nordostpark loan to default on its maturity date in October 2012. The Firefly (13.1%), Phoenix (7.2%), and Corpus (13.2%) loans are secured by German multifamily portfolios. The Firefly and Phoenix portfolios share the same sponsor and the properties under these loans are of much better quality then the Corpus properties. Moody's LTV for the Firefly and Phoenix loans are 77% and 67% respectively. The sponsor has started to delever the loan though property disposals ahead of the loans' maturity date in April 2014. Moody's default expectation for the Firefly loan is medium (10%-25%) and for the Phoenix loan it is low/medium (5%-10%). Moody's LTV for the Corpus loans is 82% based on the securitized loan and 93%based on the whole loan. This loan defaulted on its maturity date in July 2012. Redleaf I (7.6%) and Redleaf II (5.3%) loans are secured by secondary retail properties in Spain. The Redleaf I loan is already in maturity payment default and Moody's also expect the Readleaf II loan to default at maturity. Moody's LTV is 244% and 120% for the Redleaf I and Redleaf II loans respectively. Portfolio Loss Exposure: Moody's expects a significant amount of losses on the securitized portfolio, stemming mainly from the refinancing profile of the portfolio. Given the default risk profile and the anticipated work-out strategy for defaulted and potentially defaulting loans, the expected losses are likely to crystallize only towards the end of the transaction term. The principal methodology used in this rating was Moody's Approach to Real Estate Analysis for CMBS in EMEA: Portfolio Analysis (MoRE Portfolio) published in April 2006. Other factors used in this rating are described in European CMBS: 2012 Central Scenarios published in February 2012. The updated assessment is a result of Moody's on-going surveillance of commercial mortgage backed securities (CMBS) transactions. The last Performance Overview for this transaction was published on 15 June 2012. In rating this transaction, Moody's used both MoRE Portfolio and MoRE Cash Flow to model the cash-flows and determine the loss for each tranche. MoRE Portfolio evaluates a loss distribution by simulating the defaults and recoveries of the underlying portfolio of loans using a Monte Carlo simulation. This portfolio loss distribution, in conjunction with the loss timing calculated in MoRE Portfolio is then used in MoRE Cash Flow, where for each loss scenario on the assets, the corresponding loss for each class of notes is calculated taking into account the structural features of the notes. As such, Moody's analysis encompasses the assessment of stressed scenarios. Moody's ratings are determined by a committee process that considers both quantitative and qualitative factors. Therefore, the rating outcome may differ from the model output. ============= I R E L A N D ============= OMEGA CAPITAL: S&P Reinstates 'B' Ratings on Two Note Classes ------------------------------------------------------------- Standard & Poor's Ratings Services reinstated its 'B (sf)' credit ratings on Omega Capital Investments PLC's series 43 (Waypoint CDO) class A-1E and B-1E notes, which are European synthetic collateralized debt obligation (CDO) tranches. "On Aug. 7, 2012, we withdrew in error the rating on class A-1E and B-1E notes. One of the transaction participants recently informed us that the notes were not repurchased in full, which was our assumption at the time. Therefore, we have reinstated our ratings on the class A-1E and B-1E notes at the rating levels at which they were withdrawn," S&P said. 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 Rule applies to in-scope securities initially rated (including preliminary ratings) on or after Sept. 26, 2011. If applicable, the Standard & Poor's 17g-7 Disclosure Report included in this credit rating report is available at: http://standardandpoorsdisclosure-17g7.com ========= I T A L Y ========= SEAT PAGINEGIALLE: S&P Raises Corporate Credit Rating to 'CCC' -------------------------------------------------------------- Standard & Poor's Ratings Services raised its long-term corporate credit rating on Italy-based classified directory publisher SEAT PagineGialle SpA (SEAT) to 'CCC' from 'D' (Default). "At the same time, we raised our issue rating on SEAT's EUR750 million senior secured notes to 'CCC+' from 'D'. The recovery rating on these notes is '2', indicating our expectation of substantial (70%-90%) recovery prospects in the event of a payment default," S&P said. "In addition, we withdrew our 'D' issue and '2' recovery ratings on SEAT's senior secured credit facilities, including the term loan A, term loan B, and revolving credit facility (RCF)," S&P said. "Finally, we withdrew our 'D' issue and '5' recovery ratings on the EUR1.3 billion subordinated callable bonds issued by SEAT's affiliate Lighthouse International Co. S.A.," S&P said. "The upgrade reflects our understanding that SEAT has completed its financial restructuring under which the group has refinanced its existing senior secured credit facilities with EUR686 million of new senior secured credit facilities (including a new EUR90 million RCF). Following a merger into SEAT of Lighthouse International, SEAT has also undertaken a debt-to-equity swap on about EUR1.24 billion of the EUR1.3 billion subordinated bonds and accrued interest of approximately EUR69 million, in exchange for 88% of the group's voting shares. The remainder of the subordinated bonds has been converted into EUR65 million of new senior secured bonds (on the same terms and conditions as the existing EUR750 million senior secured bonds)," S&P said. "We could raise the corporate credit rating by up to two notches following our forthcoming review of information on SEAT's future earnings and cash flow generation capacity, and covenant structure. We will review the new debt documentation comprehensively and assess the group's financial policy, operating strategy, earnings, and cash flow prospects. We will also assess the effect these factors have on our assessment of the group's liquidity and financial and business risk profiles," S&P said. "SEAT, like most of its peers, is facing a continued structural decline in the print directories sector as small and midsize business advertising expands across a greater number of online marketing channels. The recent financial restructuring has materially reduced SEAT's leverage and the cost of debt. However, the long-term viability of the group's new capital structure will mainly depend on its ability to turn its business round by stabilizing revenues and profitability," S&P said. "We aim to resolve the CreditWatch within the next month, on completion of our review of the key elements of SEAT's restructuring, such as the new debt documentation, the group's financial policy and operating strategy, and its earnings and cash flow prospects. We will also review the effect of these factors on our assessment of SEAT's business and financial risk profiles. We believe this review could lead to a possible upgrade of up to two notches," S&P said SOPAF: UniCredit Wants to Commence Insolvency Proceedings --------------------------------------------------------- Elisa Anzolin at Reuters reports that judicial sources said on Wednesday UniCredit has asked a court to start insolvency proceedings for loss-making Sopaf. Sopaf, which first failed to pay back debt last November and has net debt of around EUR100 million (US$129 million), said in a statement on Wednesday it had received no official notice about the insolvency proceedings request, Reuters relates. Sopaf also said it planned to file a court request within a week to reach a shared solution with creditors that would most likely involve liquidation, though it added it did not rule out keeping the company up and running, Reuters notes. According to Reuters, the Il Messaggero newspaper said that Sopaf owes UniCredit and other bank lenders including Monte dei Paschi and Popolare di Sondrio EUR71.5 million. Sopaf is an Italian investment company. ========= M A L T A ========= ST. PHILIP'S HOSPITAL: Owes Around EUR12 Million to Creditors ------------------------------------------------------------- Malta Star reports that St. Philip's Hospital owes around EUR12 million to creditors for materials and supplies, wages of employees, and fees of consultants and banks. According to Malta Star, Dr. Frank Portelli who is responsible for running the hospital wants to start paying this money and is requesting the Malta government to give him a EUR5 million down payment as part of the EUR15 million rent for a 15-year period or the equivalent of EUR1 million rental payment per year. PN MP Francis Zammit Dimech has been acting as the middleman to reach a deal between government and Dr. Frank Portelli, a former PN MP himself and former President of the PN's Executive Committee, Malta Star discloses. Malta Star notes that while trying to reach a deal with the Malta government to rent St. Philip's Hospital to ease somewhat the problem of the shortage of bed at Mater Dei Hospital after the PN government decided to build it too small for Malta's needs, Dr. Frank Portelli has been negotiating with Italian businessmen the sale of the hospital for EUR18 million. Even Health Minister Renato Balduzzi was interested in acquiring a share in the hospital in his private capacity, Malta Star states. =========== R U S S I A =========== VNESHECONOMBANK: S&P Assesses Stand-Alone Credit Profile at 'bb' ---------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its long-term foreign currency issuer credit ratings on Russia-based Vnesheconombank (VEB) at 'BBB' and the long- and short-term local currency ratings at 'BBB+/A-2'. "We raised our short-term foreign currency rating on VEB to 'A-2' from 'A-3'. The outlook is stable," S&P said. "The ratings on VEB are based on our opinion of its status as a government-related entity (GRE) with an 'almost certain' likelihood of extraordinary support from the Russian government in case of financial difficulties," S&P said. "The rating action on the short-term foreign currency rating reflects the same action taken on June 27, 2012, on the short- term foreign currency rating on the Russian Federation (foreign currency: BBB/Stable/A-2; local currency: BBB+/Stable/A-2)," S&P said. "We assess VEB's stand-alone credit profile (SACP) at 'bb'. It is based on our 'bb' anchor and on our assessment of the bank's 'strong' business position, 'moderate' capital and earnings, 'moderate' risk position, 'above average' funding, and 'adequate' liquidity, as our criteria define these terms," S&P said. In accordance with S&P's criteria for GREs, the ratings agency's view of an 'almost certain' likelihood of extraordinary government support is based on its assessment of VEB's: -- "Critical" role to the Russian Federation as the prime public development institution of the government, a role that cannot be readily undertaken by a private entity; VEB group assets currently represent about 5% of Russia's GDP; and -- "Integral" link with the Russian Federation. This is because of VEB's special status as a state corporation, operating under the law "on bank for development" with strong oversight from the federal government and because of the government's proven track record of extraordinary financial support for VEB in all circumstances. As a result, VEB's long-term foreign currency rating is three notches higher than its SACP. "The stable outlook on VEB mirrors that on the Russian Federation. Future rating actions, positive or negative, on VEB will likely follow those on the sovereign, assuming that the institution's fundamentals and public policy functions remain unchanged," S&P said. "We could lower VEB's local currency rating over the next two years -- even if the local currency sovereign rating remains unchanged -- if VEB's link with the government weakens; for example, if VEB loses its special legal status. Alternatively, we could take a similar action if the government reduces VEB's role as a prime development institution, or significantly scales down its interventions in the domestic economy. We do not currently expect either scenario to occur, but should both take place, it could lead to a negative rating action on VEB's foreign currency rating," S&P said. =========================== U N I T E D K I N G D O M =========================== DIXONS RETAIL: Moody's Rates GBP150MM Sr. Unsecured Notes 'B1' -------------------------------------------------------------- Moody's Investors Service has assigned a B1 rating to the new GBP150 million of senior unsecured notes due 2017 issued by Dixons Retail plc. Dixons' existing ratings, which include a B1 corporate family rating (CFR), are unchanged. The outlook on the ratings is negative. Moody's expects that Dixons will use the proceeds from the new issuance to repurchase up to GBP50 million of its outstanding GBP150 million of notes due 2015, thereby smoothing out its debt maturity profile. This tender offer is subject to the successful completion of the issuance of the new notes. The new issuance will also reduce the company's reliance on its GBP300 million revolving credit facility (expiring in June 2015). Separately, Dixons has also offered to repurchase up to GBP80 million of its outstanding GBP160 million notes due 2012, using existing cash resources. Ratings Rationale The B1 rating assigned to the new notes is in line with the rating of the company's existing senior unsecured debt instruments. Because Dixons issued the new notes on an unsecured and guaranteed basis, they rank pari passu with these existing senior debt instruments, which include GBP160 million of notes due 2012 as well as GBP150 million of notes due 2015. Dixons' B1 CFR (negative outlook) primarily reflects the company's weak leverage metric, which in itself reflects continued weakness in comparable sales growth and intense competition within the electrical and consumer electronics segments. In addition, Dixons is geographically exposed to weak peripheral countries such as Greece and Italy, where the company's losses increased last year. Moreover, Dixons' earnings are highly seasonal in nature, and this year, the repayment of its GBP160 million bond will coincide with the ramp-up in its working capital needs ahead of the peak season. However, in this regard, Moody's views positively Dixons' efforts in preserving cash and the company's renegotiation of its revolving credit facility, which is a key component of its liquidity profile. The rating is supported by the company's scale and market-leading positions in the electrical and consumer electronics segments, particularly in the UK and Nordics, its degree of geographic diversification to a few other continental European countries and its overall efficient distribution and supply-chain infrastructure. Moody's expects that Dixons' ongoing Renewal and Transformation Plan (which includes the revamping of stores and cost reductions) will position the company more strongly within the sector when its sales recover. The negative outlook is premised on Moody's expectation that Dixons' metrics will remain weak for the current rating at least for several quarters. This reflects the challenging macroeconomic environment in some of the countries in which the company operates. What Could Change The Rating Up/Down Although unlikely in the near term, Moody's believes that positive pressure on the rating or outlook could occur if the company's earnings were to sustainably improve, translating into better credit metrics including a debt/EBITDA ratio comfortably below 5.5x and an EBITA/interest expense ratio sustained at, or higher than, 2.0x. Conversely, negative rating pressure would likely arise if Dixons' metrics were to deteriorate further in coming quarters, or if Moody's were to become concerned about the company's liquidity, either in terms of access to the revolving credit facility or weaker cash generation. Principal Methodology The principal methodology used in rating Dixons Retail plc was the Global Retail Industry Methodology published in June 2011. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Headquartered in Hemel Hempstead, England, Dixons Retail plc is one of Europe's leading specialist electrical retailing and services companies. It posted revenues of GBP8.19 billion for the financial year ended April 28, 2012 (FY 2012). ENPURE: Enters Administration, Ends Seawage Project --------------------------------------------------- BBC News reports that a GBP7 million sewage works project at Jersey's Bellozanne has been halted after Enpure went into administration. Enpure was five months into an 18-month project to replace the sludge treatment facility at the St. Helier site, according to BBC News. The report relates that as a result of the work stopping, 25 workers and sub-contractors left the site. BBC News discloses that Sewage will continue to be treated at the existing plant, although its closure in November 2013 is in doubt. The report notes that Chris Sampson from Transport and Technical Services, which oversees the treatment of sewage in Jersey, said the sludge treatment was a major part of the overall process. "The site remains closed at the moment, whilst we're in discussions with the administrators on how to restart the contract," the report quoted Mr. Sampson as saying. Mark Hopkins, Matthew Hammond and Steve Ellis have been appointed as joint administrators. Enpure is a UK waste processing firm. GKN HOLDINGS: S&P Assigns 'BB+' Rating to Euro Medium-Term Note --------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB+' rating to the proposed unsecured euro medium-term note (EMTN) issue announced by the U.K. engineering group GKN Holdings PLC (GKN; BB+/Stable/--). The recovery rating is '4'. "We also affirmed our 'BB+' issue rating and '4' recovery rating on the existing GBP350 million 6.75% notes due Oct. 28, 2019," S&P said. "On Sept. 4, 2012, GKN announced its intention to issue the unsecured notes under the GBP2.0 billion EMTN program in order to part-finance the acquisition of Volvo Aero (the aero engine division of AB Volvo; BBB/Stable/A-2), announced in July 2012," S&P said. "The existing GBP350 million 6.75% notes due Oct. 28, 2019, and the proposed notes, both issued by GKN, are rated 'BB+', the same level as the long-term corporate credit rating on GKN. The recovery rating on these notes is '4', indicating our expectation of average (30%-50%) recovery in the event of a payment default. Our ratings assume the issuance of about EUR500 million or currency equivalent of this amount," S&P said. "The recovery and issue ratings are supported by our assessment of GKN as a going concern and the moderate level of prior ranking debt at the point of default. However, we consider that the ratings are constrained at the '4' level by GKN's high level of unfunded pension liabilities, the notes' relatively weak security and guarantee package, and GKN's exposure to multiple jurisdictions, which we believe could reduce funds available to creditors in a hypothetical default," S&P said. "The recovery and issue ratings are constrained by the material pension deficit (about GBP1.2 billion as of Dec. 31, 2011), mainly in the U.K., Germany, and the U.S., that could either reduce the enterprise value at default or have a contractually or structurally senior claim over the unsecured debtholders at the point of reorganization. Likewise, GKN's unrated unsecured revolving credit facilities (RCFs) benefit from stronger protection than the notes owing to the RCFs' maintenance financial covenants. In addition, if GKN were to refinance the RCFs on a secured basis in the run-up to default, we believe the recovery prospects for the senior unsecured noteholders would be significantly reduced," S&P said. "We assume that primary insolvency proceedings would likely occur in the U.K. as the center of main interest (COMI). We classify the U.K. as a Group A1 country in terms of the level of creditor protection that the U.K. insolvency regime offers. However, GKN has distinct operations in different jurisdictions, and in our view any insolvency process that incorporates multijurisdictional proceedings would likely have a negative effect on the ultimate recovery prospects since it could potentially take longer and be Expensive," S&P said. "We believe that if GKN experienced a payment default, it would most likely be reorganized as a going concern, as we anticipate that its leading market positions in the European market, good geographic and end-market diversity, and presence in relatively stable aerospace business will be recognized by potential buyers even under distressed circumstances," S&P said. "We continue to believe that the main rating constraints for GKN are the highly cyclical and competitive characteristics of the auto components market; the group's limited presence in the auto and aerospace aftermarkets; and the group's volatile credit metrics, partly as a result of its acquisitive growth strategy. These constraints are partially offset by GKN's leading position in auto components, the stable earnings generated by the Aerospace division, and the group's good geographic and customer diversification," S&P said. * Restructuring Vet Yushan Ng Joins Cadwalader's London Office -------------------------------------------------------------- Cadwalader, Wickersham & Taft LLP, a leading counselor to global financial institutions and corporations, disclosed that Yushan Ng, a veteran restructuring and insolvency attorney who has been recognized and honored as one of the leading practitioners in his field in Europe, has joined the firm's Financial Restructuring Department as partner. Mr. Ng will practice from Cadwalader's London office. "Yushan is one of the most talented restructuring lawyers in Europe today. We are very pleased to be able to make his talents available to our clients in this very challenging business environment," said W. Christopher White, Chairman of Cadwalader. "Yushan has that valuable combination of broad experience and creative approach to problem solving that help make him so effective. He will make Cadwalader's talented group of restructuring lawyers even stronger." Mr. Ng joins Cadwalader from Linklaters where he was one of the partners who led the distressed investment practice. In this role, he was responsible for leading a wide range of domestic and cross-border restructurings, insolvency proceedings and financings. In addition, Mr. Ng also served as the primary relationship partner for numerous private equity and hedge funds that invest in distressed and special situations. He has held central roles in a number of recent milestone European corporate restructurings including SEAT Pagine SpA, Fitness First, Klockner Pentaplast, Truvo and Regency Casinos. "Cadwalader was the pioneer in developing a fund oriented creditor side practice in London," stated Mr. Ng. "I am looking forward to joining their excellent team in the very focused practice where I specialize." "I am delighted to welcome Yushan to our Restructuring team," remarked Gregory Petrick, Managing Partner of the firm's London office and Head of its European and Asian Restructuring Practice. "Yushan's experience, his reputation for innovation and extraordinary technical expertise will contribute to the team's continued success and expansion." Richard Nevins, senior partner in Cadwalader London's Financial Restructuring Department added: "Our group is now poised to become one of the elite restructuring and insolvency practices in Europe. Bringing on board an outstanding lawyer like Yushan Ng brings us closer to that goal." Mr. Ng began his tenure at Linklaters as a trainee solicitor in 1999 before being promoted to associate solicitor in 2001. He was named partner in 2008. Ng holds a B.A., with honors, in Jurisprudence from Merton College, Oxford University. Following graduation, he participated in the Bar Vocational Course at The Inns of Court School of Law. Cadwalader's Financial Restructuring Practice is a premier restructuring, bankruptcy, insolvency and workout group headquartered in New York under the direction of John Rapisardi and George Davis. About Cadwalader Wickersham Cadwalader, Wickersham & Taft LLP -- http://www.cadwalader.com/ -- established in 1792, is an international law firm, with offices in New York, London, Charlotte, Washington and Beijing. Cadwaladerr serves a diverse client base, including many of the world's top financial institutions, undertaking business in more than 50 countries in six continents. The firm offers legal expertise in antitrust, banking, business fraud, corporate finance, corporate governance, environmental, healthcare, insolvency, insurance and reinsurance, intellectual property, litigation, mergers and acquisitions, private client, private equity, real estate, regulation, securitization, structured finance, and tax. =============== X X X X X X X X =============== * Moody's Says EMEA Spec-Grade Cos. Have Weak Liquidity Profile --------------------------------------------------------------- Around 15% of rated speculative-grade non-financial companies in Europe, Middle East and Africa (EMEA) have a weak liquidity profile compared to only 3.5% in North America and 21.8% in Asia according to a new report published by Moody's Investors Service on Sept. 12. The launch issue of the new quarterly report is titled "SGL Monitor -- EMEA Edition". Moody's subscribers can access this report via the link provided at the end of this press release. The EMEA SGL Monitor report, along with the Asia and US versions, will provide investors with a regular update and comparative tool for assessing the collective liquidity profile of speculative- grade companies in the three regions. The current report shows that 59% of speculative-grade issuers in EMEA have a SGL-3 or SGL-4 rating (indicating they have adequate or weak liquidity, respectively) compared with 53% in Asia and 35% in North America. The new report assesses liquidity trends for 255 speculative- grade companies across 30 countries and 27 industries, covering more than US$227 billion of rated debt in the Europe, Middle East and Africa (EMEA) region. Speculative-grade liquidity ratings or SGLs are developed for each company using Moody's unique global approach for assessing the liquidity of speculative-grade companies. The SGLs are given based on four liquidity components: cash flow and internal sources of cash; liquidity availability and external sources of cash; covenants; and alternative sources of liquidity; and a score is assigned ranging from 1 (very good) to 4 (weak). While the overall SGL rating considers these four components, the composite SGL rating is not a weighted average of the four component scores, since their relative importance varies over time. "We are seeing weaker liquidity among EMEA spec-grade corporates than in North America, mostly due to the pressure of the weaker macroeconomic environment in the region on the earnings of many companies across EMEA," says Soummo Mukherjee, a Moody's Vice President - Senior Credit Officer. "The weaker liquidity profile also reflects, to some extent, the higher reliance of issuers in EMEA on bank relationships which often results in credit facilities that are shorter-term or more conditional than in North America." The new publication also features Moody's proprietary Liquidity Stress Index (LSI), which will track the percentage of speculative-grade companies with the lowest SGL rating (SGL-4), which currently stands at 15% of the 255 speculative-grade companies. This index will allow market participants to anticipate changes in the speculative-grade default rate as increases in the index reflect weakening liquidity and the greater likelihood of an increased default rate. Companies with relatively weak liquidity are likely to have low corporate family ratings (CFRs), which reflect a higher probability of default. Moody's has published short-term scores for speculative-grade issuers, known as SGLs or Speculative Grade Liquidity Ratings, for individual issuers in the US since 2002. Moody's does not publish individual SGLs for issuers in EMEA or in Asia, but conducts the same analytical process. The EMEA LSI will be directly comparable to the existing Moody's North America and Asia (ex-Japan) indexes. * BOOK REVIEW: Ralph H. Kilmann's Beyond the Quick Fix ------------------------------------------------------ Author: Ralph H. Kilmann Publisher: Beard Books Hardcover: 320 pages 121 Listprice: $34.95 Review by Henry Berry Every few years, a new approach is offered for unleashing the full potential of organized efforts. These are the quick fixes to which the title of this book refers. The jargon of the quick fix is familiar to any businessperson: decentralization, human resources, restructuring, mission statement, corporate strategy, corporate culture, and so on. These terms are all limited in scope or objective, and some are even irrelevant or misconceived with regard to the overall well-being and purpose of a corporation. With his extensive experience as a corporate consultant, author of numerous articles, and professor in business studies, Kilmann recognizes that each new idea for optimum performance and results is germane to some area of a corporation. However, he also recognizes that each new idea inevitably falls short in bringing positive change -- that is, a change that is spread throughout the corporation and is lasting. At best, when a corporation relies on an alluring, and sometimes little more than fashionable, idea, it is a wasteful distraction. At worst, it can skew a corporate organization and its operations, thereby allowing the corporation's true problems or weaknesses to grow until they become ruinous. As the author puts it, "Essentially, it is not the single approach of culture, strategy, or restructuring that is inherently ineffective. Rather, each is ineffective only if it is applied by itself -- as a "quick fix"." Kilmann tells corporate leaders how to break the cycle of embracing a quick fix, discarding it after it proves ineffective, and then turning to a newer and ostensibly better quick fix that soon proves to be equally ineffective. For a corporation to break this self-defeating cycle, the author offers a five-track program. The five tracks, or elements, of this program are corporate culture, management skills, team-building, strategy-structure, and reward system. These elements are interrelated. The virtue of Kilmann's multidimensional five-track program is that it addresses a corporation in its entirety, not simply parts of it. Kilmann's five tracks offer structural and operational aspects of a corporation that executives and managers will find familiar in their day-to-day leadership and strategic thinking. Thus, the author does not introduce any unfamiliar or radical perspectives or ideas, but rather advises readers on how to get all parts of a corporation involved in productive change by integrating the five tracks into "a carefully designed sequence of action: one by one, each track sets the stage for the next track." Kilmann does more, though, than bring all significant features of a modern corporation together in a five-track program and demonstrate the interrelation of its elements. His singularly pertinent and useful contribution is providing a sequence of steps to be implemented with respect to each track so that a corporation progresses toward its goals in an integrated way. Beyond the Quick Fix is a manual for implementing and evaluating the progress of a five-track program for corporate success. The 122 book should be read by any corporate leader desiring to bring change to his or her organization. Ralph H. Kilmann has been connected with the University of Pittsburgh for 30 years. For a time, he was its George H. Love Professor of Organization and Management at its Katz Graduate School of Business. Additionally, he is president of a firm specializing in quantum transformations. ********* 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, Ivy B. Magdadaro, Frauline S. Abangan and Peter A. Chapman, Editors. Copyright 2012. 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 Peter Chapman at 240/629-3300. * * * End of Transmission * * *