/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/130529.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 Wednesday, May 29, 2013, Vol. 14, No. 105 Headlines A U S T R I A WALTER NIEMETZ: Heidi Chocolat Buys Firm Out of Insolvency G E R M A N Y AXA IMMOSELECT: Sales Slowdown Hits Investor Distribution H U N G A R Y ZALAI BAROMFIFELDOLGOZO: Goes Into Liquidation I T A L Y RCS MEDIAGROUP: Creditors Agree to Increase Credit Lines L U X E M B O U R G NORTHLAND RESOURCES: Bondholders Block Access to Bank Accounts P O L A N D POLSKI KONCERN: Fitch May Upgrade Issuer Default Rating From BB+ S P A I N BANKIA SA: Completes Multi-Billion Euro Cash Injection PRIVATE MEDIA GROUP: Incurs EUR29.3-Mil. Net Loss in 2011 U N I T E D K I N G D O M ACE CLEANING: Bridgestones Appointed as Liquidators BLACK AND WHITE: Creditors Met Following Liquidation CO-OPERATIVE BANK: Appoints Niall Booker as Chief Executive IAN NEALE: Football Stadium Owner Placed in Liquidation MILLOM & DISTRICT: FSCS Takes Action After Liquidation ********* ============= A U S T R I A ============= WALTER NIEMETZ: Heidi Chocolat Buys Firm Out of Insolvency ---------------------------------------------------------- Austrian Times reports that the Meinl subsidiary Heidi Chocolat bought the Schwedenbomben manufacturer Niemetz for EUR5.25 million. The firm promised to keep the production in Austria, which pleased the Niemetz staff. Austrian Times says Niemetz, the insolvent Austrian manufacturer of the "Schwedenbomben" confectionary, could not be saved. More than EUR4.1 million had to be transferred to the liquidator until May 21; as this did not happen, the factory was sold immediately. According to the report, Heidi Chocolat AG made a binding bid for the sweet factory of Walter Niemetz. The firm thus wants to enter the Austrian market and to make the sweet Schwedenbombe popular in the neighbouring countries. The creditors will get their claims fully substituted. Heidi Chocolat S.A. was founded in Romania by the Swiss traditional confiserie Laderach in 1994. It became a subsidiary of Julius Meinl in April and has shops in more than 40 countries. The firm, with its headquarters in Pantelimon near Bucharest, offers a range of classic chocolate bars in various flavours, pralines, creme and nut bars. The staff is relieved that the uncertainty of the past weeks is now followed by a stable and sustainable solution. Apparently, Austrian Times says, the future owner wants to keep as many Niemetz employees as possible. ============= G E R M A N Y ============= AXA IMMOSELECT: Sales Slowdown Hits Investor Distribution --------------------------------------------------------- Property Investor Europe reports that German open-ended AXA Immoselect, a fund of French AXA Real Estate in liquidation since October 2011, may not be able to distribute its half-yearly repayment to investors in June due to a sales slowdown and other liabilities. ============= H U N G A R Y ============= ZALAI BAROMFIFELDOLGOZO: Goes Into Liquidation ---------------------------------------------- The Budapest Times reports that Zalai Baromfifeldolgozo went into liquidation and sacked 94 workers at its factory in Pacsao only 16 months after it began operating. The HUF1.5 billion (EUR5.14 million) unit is one of the largest in Hungary and before the launch the company won HUF625 million (EUR2.14 million) in support for the investment, comprising HUF401 million (EUR1.37 million) from the previous government and HUF224 million (EUR768,000) in job-creation subsidy from the current one. According to the report, receiver Ferenc Somogyi said at the time the liquidation was requested the company's assets were worth about HUF1 billion (EUR3.43 million) but debts amounted to around HUF2.6 billion (EUR8.94 million). Zalai Baromfifeldolgozo is a poultry-processing company. ========= I T A L Y ========= RCS MEDIAGROUP: Creditors Agree to Increase Credit Lines -------------------------------------------------------- Sonia Sirletti at Bloomberg News, citing La Stampa, reports that RCS MediaGroup's bank creditors agreed to increase credit lines to EUR600 million from planned EUR575 million. According to Bloomberg, La Stampa said RCS is to ratify the decision at a board meeting scheduled today, May 29. In an April 14 report, Reuters disclosed that the board of RCS approved the broad terms of a capital increase and a debt refinancing plan needed for the loss-making company's turnaround plan. The company needs large financial resources to accelerate its digital transition and reverse losses over the next three years, Reuters disclosed. RCS reported a group's net loss of EUR509.3 million for 2012, and is seeking shareholders support for a cash call of up to EUR600 million (US$786 million) by 2015, with a first tranche of EUR400 million by July, Reuters related. In April, the group agreed with creditor banks Unicredit, Intesa Sanpaolo, Mediobanca, UBI Banca, Bnl-BNP Paribas and Banca Popolare di Milano to reschedule maturing loans worth EUR575 million, Reuters recounted. RCS, as cited by Reuters, said that the refinancing, which entails three new lines of credit due in three to five years, is conditional on the completion of a capital injection of at least EUR400 million. RCS MediaGroup is the publisher of Italy's newspaper Il Corriere della Sera, whose ownership groups some of Italy's biggest financial and industrial names =================== L U X E M B O U R G =================== NORTHLAND RESOURCES: Bondholders Block Access to Bank Accounts -------------------------------------------------------------- Karl-Axel Waplan, President & CEO, Northland Resources S.A., disclosed that Norsk Tillitsman, the Trustee, acting on behalf of the bondholders of the US$370 million senior secured bond, on May 24 decided to enforce on bank account pledges leaving the Company without access to its own funds. As a consequence Northland lacks the liquidity to make any payments. The Board of Directors has therefore decided that as of May 24, none of the companies in the Group shall order or receive any goods or services. The Company will over the weekend pursue all available options to try to find a solution for the short and long term funding. The decision to block the bank accounts came after a meeting on May 24 between the Trustee, a few larger bondholders and their advisers where they also turned down the proposed US$35 million short bridge facility which would have required a bondholder approval which was planned for Thursday, May 30. Headquartered in Luxembourg, Northland Resources S.A. (OSLO:NAUR) (FRANKFURT:NPK) (OMX:NAURO) -- http://www.northland.eu-- is a producer of iron ore concentrate, with a portfolio of production, development and exploration mines and projects in northern Sweden and Finland. The first construction phase of the Kaunisvaara project is complete and production ramp-up started in November 2012. The Company expects to produce high-grade, high-quality magnetite iron concentrate in Kaunisvaara, Sweden, where the Company expects to exploit two magnetite iron ore deposits, Tapuli and Sahavaara. Northland has entered into off-take contracts with three partners for the entire production from the Kaunisvaara project over the next seven to ten years. The Company is also preparing a Definitive Feasibility Study ("DFS") for its Hannukainen Iron Oxide Copper Gold ("IOCG") project in Kolari, northern Finland and for the Pellivuoma deposit, which is located 15 km from the Kaunisvaara processing plant. =========== P O L A N D =========== POLSKI KONCERN: Fitch May Upgrade Issuer Default Rating From BB+ ---------------------------------------------------------------- Fitch Ratings has assigned Polish oil refining and marketing company Polski Koncern Naftowy ORLEN S.A.'s (PKN) domestic 4-year PLN200 million bonds a 'BBB+(pol) National senior unsecured rating. PKN is rated 'BBB+(pol)'/Positive Outlook on the national rating scale and 'BB+'/Positive Outlook on the international rating scale. The bonds are issued within the PLN1 billion bond issue program. The bonds constitute senior unsecured obligations of PKN. There are no financial covenants included in the bond documentation. Key Rating Drivers Positive Outlook The Positive Outlook reflects Fitch's view that PKN's ratings may be upgraded in 2013-2014, including the company's Long-term Issuer Default Ratings (IDRs) to 'BBB-' from 'BB+', should the company consistently maintain credit ratios at a moderate level. The future leverage level will mainly depend on the strategy implementation, in particular capex levels in relation to cash flows, and the macroeconomic conditions for refining and petrochemicals operations in the medium term. Better Financial Profile The ratings reflect PKN's improved financial profile thanks to several measures taken by management to reduce leverage, including the disposal of Polkomtel S.A. (after-tax proceeds of PLN3.2 billion (US$1 billion)), its modest capex in 2011-2012 following a capex-intensive period in 2007-2010, and no dividends paid in 2011-2012. This supports PKN's creditworthiness in the still difficult conditions for the European oil refining sector due to the overcapacity and weak demand. Strategy Implementation Fitch views PKN's strategy update announced in November 2012 as supporting the company's credit profile. One of PKN's strategic targets is to maintain credit ratios at a safe level, including the gearing ratio below 30% and covenant net debt-to-EBITDA below 1.5x. While the capex plan for 2013-2017 of PLN22.5 billion is large -- about 50% higher than in 2008-2012, the company also expects an increase in EBITDA partly due to investments. Fitch views positively the fact that around PLN7bn of the planned capex for 2013-2017 is discretionary (mostly in the upstream and energy segments) and may be deferred or cancelled in case of weaker than expected cash flows. Improved Flexibility Fitch believes that PKN has much greater flexibility to reduce its capex in case of weaker cash flows now than in 2007-2010, when it was conducting some major committed investments. The agency views positively PKN's proven ability to manage its working-capital changes in line with changes in its financial position. This could provide additional flexibility for the company should industry conditions weaken, leading to a deterioration of reported credit ratios potentially close to the covenant level defined in the main bank loan agreements. Cyclical Sectors Most of PKN's EBITDA is generated in two highly cyclical sectors: oil refining and petrochemicals (each sector generated about 40% of 2011-2012 EBITDA before inventory holding gains/losses). The remaining 20% of EBITDA comes from the more stable fuel retailing business. Fitch views PKN as a refining company with high business diversification in light of its substantial petrochemical operations and a strong position in fuel retail sales. Rating Sensitivities Positive: Future developments that could lead to positive rating actions include: -- The company's ability to consistently maintain credit ratios at moderate levels, including funds from operations (FFO) adjusted net leverage of about 2x (excluding inventory holding gains/losses) and FFO fixed charge cover of about 5x (excluding inventory holding gains/losses); -- Positive free cash flow across the cycle; -- Reduced working capital burden for compulsory stock in case of changed Polish regulations increasing the role of government in the storage of compulsory stock ; -- Reduced volatility of PKN's profit margins. Negative: The current Outlook is Positive. As a result, Fitch's sensitivities do not currently anticipate developments with a material likelihood, individually or collectively, leading to a rating downgrade. Nonetheless, factors that may potentially lead to a stabilization of the Outlook or even negative rating action include: -- A marked deterioration in cash flows and credit metrics due, for example, to substantially weaker than expected conditions for refining and petrochemicals operations; -- Capex substantially above FFO resulting in highly negative free cash flow in the medium term; -- Aggressive dividend policy. Liquidity and Debt Structure At end-March 2013, short-term debt of PLN3.2 billion (US$1 billion) was covered by cash of PLN1.3 billion, and unused committed bank facilities of PLN9.6 billion, which expire mostly in 2016. PKN's debt maturity profile is not onerous with no major repayments until 2016. The company had sufficient headroom within its financial covenants at end-December 2012. Full List of Ratings Long-term foreign currency IDR at 'BB+'; Outlook Positive Long-term local currency IDR at 'BB+'; Outlook Positive Short-term foreign currency IDR at 'B' Short-term local currency IDR at 'B' Foreign currency senior unsecured rating at 'BB+' Local currency senior unsecured rating at 'BB+' National Long-term rating at 'BBB+(pol)'; Outlook Positive National senior unsecured rating at 'BBB+(pol)' ========= S P A I N ========= BANKIA SA: Completes Multi-Billion Euro Cash Injection ------------------------------------------------------ Reuters reports that Bankia SA has completed a multi-billion euro cash injection. According to Reuters, more than 11 billion shares issued as part of a EUR15.5 billion (GBP13.3 billion) recapitalization of the bank started trading in what was meant to be a new beginning after a EUR24 billion bailout last year. But some analysts say the stock could remain under pressure, with little hope of a quick recovery amid tough business conditions, Reuters notes. Following the cash injection, the Spanish state owns 68.4% of Bankia, with the rest held by former holders of preference shares and hybrid debt, often small savers who were mis-sold these complex financial instruments and were forced to swap them at a discount for ordinary shares, Reuters discloses. Further pressure will come from a recession which economists expect to last at least another two quarters, Reuters says. The bank also needs to pay back public aid and cheap European Central Bankloans received last year and faces a possible new round of provisioning to cover losses on the refinanced loans portfolios, Reuters states. Prospects for the bank are also clouded by uncertainty over government plans for handling state-owned banks and potential risks from arbitration over the mis-selling of preference shares and hybrid debt which it could have to settle in cash, according to Reuters. Bankia SA is a Spanish banking conglomerate that was formed in December 2010, consolidating the operations of seven regional savings banks. As of 2012, Bankia is the fourth largest bank of Spain with 12 million customers. PRIVATE MEDIA GROUP: Incurs EUR29.3-Mil. Net Loss in 2011 --------------------------------------------------------- Private Media Group, Inc., filed on May 23, 2013, its annual report on Form 10-K for the year ended Dec. 31, 2011. The Company said: "As explained in greater detail in this Annual Report on Form 10-K, the former principal executive officers of Private Media Group, Inc., were relieved of their duties in December 2011, and most of the former members of the Board of Directors were removed by the shareholders at the annual meeting of the shareholders held in January 2012. Upon assuming control, the new officers and directors discovered that many of Private Media Group, Inc.'s important financial and corporate records, including those necessary to complete the 2011 audited financial statements, were in disarray and/or missing. As a result of the change in management and the condition of the financial and corporate records, Private Media Group, Inc., and its auditors were unable to complete the audited financial statements for the year ended Dec. 31, 2011, until May 2013. BDO Auditores, S.L., in Barcelona, Spain, expressed substantial doubt about Private Media Group's ability to continue as a going concern, citing the Company's recurring losses from operations, and working capital deficit and negative net equity position at Dec. 31, 2011. "Moreover, as of Dec. 31, 2012, the Group has not yet reestablished profitable operations. The Company reported a net loss of EUR29.3 million on EUR7.9 million of sales in 2011, compared with a net loss of EUR4.3 million on EUR23.3 million of sales in 2010. "The decrease in net sales is attributable to both (a) the exclusion of EUR11,423,000 of net sales [of] Game Link and Sureflix in 2011, which net sales were excluded from net sales in fiscal 2011 because of the divestiture of those two subsidiaries, and (b) an overall decrease in net sales in our core "Private" branded operations. The Company's balance sheet at Dec. 31, 2011, showed EUR11.5 million in total assets, EUR17.8 million in total liabilities, and a stockholders' deficit of EUR6.3 million. A copy of the Form 10-K is available at http://is.gd/Yu1k4T Located in Barcelona, Spain, Private Media Group, Inc., is an international provider of branded adult media across a wide range of digital platforms and physical formats. It conducts its operations through various non-U.S. subsidiaries located in a number of countries, including Cyprus, Sweden, Spain and Gibraltar. =========================== U N I T E D K I N G D O M =========================== ACE CLEANING: Bridgestones Appointed as Liquidators --------------------------------------------------- Joe McGrath at Insolvency News reports that Ace Cleaning Company Limited (ACCL) is to be wound up following a meeting of creditors on May 7, 2013. Jonathan Lord of Bridgestones is the insolvency practitioner appointed to handle the liquidation of the business. The most recent annual accounts filed with Companies House show that the company had amounts falling due of GBP712,905 within one year as declared at the end of February 2012 against total current assets of GBP280,457. Ace Cleaning Company Limited is a cleaning company featured on ITV's Grimefighters. Ace Cleaning has three offices in Coventry, Leicester and Tamworth offering cleaning services to businesses in the Midlands. BLACK AND WHITE: Creditors Met Following Liquidation ---------------------------------------------------- Jennifer Faull at The Drum reports that Newcastle-based ad agency Black and White has called a meeting of creditors after going into liquidation. "A statement of affairs of the company, and a list of the creditors of the company and the estimated amount of their claims, will be presented at the meeting, and, if thought fit, a liquidator may be nominated and a liquidation committee appointed," a notice in the London Gazette obtained by The Drum stated. "Resolutions may be taken at the meeting specifying the terms on which the liquidator is to be remunerated. The meeting may also receive information about the costs of preparing the statement of affairs and convening the meeting." P&A Partnership has been called in to act as an insolvency practitioner, says The Drum. The first meeting, called by managing director Anne Lamb, took place on May 21. Black and White, which was established in 1984, has delivered campaigns for The Bed Shed, Reid Furniture, Edinburgh Woollen Mill and Leeds Building Society. CO-OPERATIVE BANK: Appoints Niall Booker as Chief Executive ----------------------------------------------------------- Philip Aldrick at The Telegraph reports that the Co-operative Group has hired a former senior HSBC director to take charge of its struggling banking arm. Niall Booker, 54, who was head of HSBC's North American operations until a management shake-up in 2011, is joining the mutual as chief executive of the Co-op Bank and deputy chief executive of the entire supermarkets-to-funerals group, the Telegraph discloses. According to the Telegraph, Mr. Booker's immediate job will be to fix the problems in the banking arm, which is believed to be facing a capital shortfall of between GBP1 billion and GBP1.5 billion and has ceased new business lending. The hire is also likely to scotch speculation that the bank will be sold or shut down, the Telegraph says. The group is working with regulators to find a solution to its capital problems, the Telegraph discloses. A three-pronged strategy is currently being explored that is likely to see both the lender and the group sell off businesses, and the bank's GBP1.3 billion subordinated bondholders take a hit, according to the Telegraph. Co-op Bank preference shares have already collapsed in value, the Telegraph relates. Its permanent interest bearing shares, which are often held by retail investors, could also be under threat, the Telegraph notes. The Co-op has seen a series of senior executives quit in the wake of disastrous results and a credit downgrade to "junk" by Moody's earlier this month, when it also suggested the bank might need state support, the Telegraph recounts. Founded in 1863, the Co-op has more than six million members, employs more than 100,000 people and has turnover of more than GBP13 billion. * * * As reported by the Troubled Company Reporter-Europe on May 13, 2013, Moody's Investors Service downgraded the deposit and senior debt ratings of Co-operative Bank plc to Ba3/Not Prime from A3/Prime 2, following its lowering of the bank's baseline credit assessment (BCA) to b1 from baa1. The equivalent standalone bank financial strength rating (BFSR) is now E+ from C- previously. IAN NEALE: Football Stadium Owner Placed in Liquidation --------------------------------------------------------- Coventry Telegraph reports that Ian Neale Construction Group Ltd, the company which owns Nuneaton Town's football stadium, has been placed in liquidation. A meeting of shareholders and creditors met on May 21 which could begin a process to sell the club's Liberty Way ground. According to the report, liquidators were appointed for Ian Neale Construction Group Ltd and act as landlord for the stadium. John Rimmer, insolvency practitioner at BRI Business Recovery and Insolvency, in Coventry, was appointed along with Peter Windatt, the report says. "We can now start the process of getting a valuation and inviting offers (for the stadium). We will now see what creditors claim are and what the company's assets are," the report quotes Mr. Rimmer as saying. "A liquidator looks to close the liquidation as soon as possible but we're looking at a matter of months rather than weeks." Mr Rimmer added: "We want to make it clear that there is no change to the football club. We are merely acting as (stadium) landlord and it's business as usual for the football club." Ian Neale Construction Group holds the freehold of the stadium but the football club is owned by a separate company, Boro Leisure Limited, which holds a ten-year lease to occupy the ground. MILLOM & DISTRICT: FSCS Takes Action After Liquidation ------------------------------------------------------ Kevin White at FTAdviser reports that the Financial Services Compensation Scheme has pledged to protect members of The Millom & District Credit Union after it became the 18th to enter into liquidation across the United Kingdom in less than two years. The Millom & District Credit Union entered liquidation on May 15, 2013, after the FA suspended it last November from lending money or allowing members access to their accounts. FTAdviser relates that an FSA supervisory notice said it was not satisfied that management of the credit union was "fit and proper," and had failed to provide audited financial information and regulatory returns. According to the report, FSCS said 530 people have approximately GBP235,000 deposited with the credit union. People with less than GBP1,000 will receive a letter to enable them to get cash over the counter at a post office. Anyone with more than this figure will receive a cheque. Earlier this month, trade body the Association of British Credit Unions launched an expansion project designed to offer a wider range of products for members, including current accounts, budgeting accounts and Cash Isas, the report notes. ********* 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., Washington, D.C., 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 2013. 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$775 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 215-945-7000 or Nina Novak at 202-241-8200. * * * End of Transmission * * *