---

        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, February 8, 2019, Vol. 20, No. 028


                            Headlines


F R A N C E

FINANCIERE N: S&P Assigns 'B' Issuer Credit Rating
VALLOUREC SA: Creditors Seek to Cut Exposure Amid Breach Fears


I R E L A N D

OPENHYDRO: Founders Ordered to Pay Legal Costs for Failed Rescue


N E T H E R L A N D S

CIMPRESS NV: S&P Cuts Issuer Credit Rating to BB-, Outlook Stable


R U S S I A

CREDIT BANK OF MOSCOW: S&P Rates New Euro Sr. Unsec. LPNs 'BB-'


S P A I N

DIA: S&P Cuts Long-Term ICR to 'CCC' on Near-Term Refinancing


U N I T E D   K I N G D O M

CRADLE ARC: Appoints Joint Administrators from Antony Batty
FLYBE GROUP: Shareholder Clears Key Hurdle in Bid to Block Sale
INTERSERVE PLC: Largest Shareholder Opposes Rescue Deal
ITHACA ENERGY: S&P Withdraws 'B' Long-Term Issuer Credit Rating


X X X X X X X X

* BOOK REVIEW: Macy's for Sale


                            *********



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


FINANCIERE N: S&P Assigns 'B' Issuer Credit Rating
--------------------------------------------------
S&P Global Ratings is assigning its 'B' issuer credit rating to
Financiere N.

Financiere N, Nemera's parent company, has completed the
allocation of the EUR375 million senior secured first-lien term
loan due 2026 (consisting of EUR325 million euro-denominated and
$57.25 million U.S. dollar-denominated tranches) and EUR85
million second-lien term loan due 2027 (consisting of EUR56.65
million euro-denominated and $32.664 million dollar-denominated
tranches), supporting its buyout by private equity groups Montagu
Private Equity, Astorg Partners, and Nemera's management. The
transaction, which valued the company at EUR1.05 billion (net of
transaction fees) included the refinancing of its capital
structure. Based in France, Nemera is a leading contract medical
devices manufacturer with a well-established presence in all drug
delivery routes including parenteral, inhalation, ophthalmic,
dermal, ear, nose, and throat. Nemera also sells packaging,
ancillary medical products, and non-core diagnostic products
(about 10% of 2017 revenues), which we understand are in rundown
mode, because it intends to focus purely on medical devices
manufacturing. In the fiscal year ending Dec. 31, 2017, the group
reported revenues of about EUR305 million and EBITDA of EUR58.5
million.

The 'B' rating on Nemera is constrained by the group's financial-
sponsor ownership and very high closing (post-transaction)
leverage of around 8.0x. S&P said, "We forecast moderate
deleveraging to just below 7.0x by 2020 on the back of a growing
contribution from the group's higher-margin own-IP business
segment, largely supported by existing and new programs related
to its flagship device Novelia. Our forecast also reflects the
sizable pass-through cost mechanisms embedded in the group's
contracted business (85% in 2017), whereby effectively 80% of
operating costs are passed onto customers."

S&P's assessment of Nemera's business risk reflects the group's
small size relative to the wider outsourced medical equipment
manufacturing industry, high customer concentration, and below-
average profitability. The latter reflects the strong bargaining
power of large pharmaceutical (pharma) clients in certain parts
of the group's product segments. In S&P's view, these weaknesses
are only partly mitigated by Nemera's strong market position in
all drug delivery routes, the accumulated know-how, and track
record of high quality standards. Nemera's business model is
supported by the need for a broad range of medicines to be sold
either inside or alongside a custom-designed delivery device. In
these cases, the drug and the delivery device are registered
jointly for regulated medical use. The development of such
devices typically needs to be finalized at least three years
before the expected drug launch to allow for timely regulatory
approval. Consequently, switching costs might be high for
Nemera's customers, while new entrants would also need to make
large investments in reliable and scalable manufacturing
facilities. In addition, manufacturing sites are subject to
stringent regulatory and quality assurance standards, which in
S&P's view contributes to the industry's high barriers to entry.

The devices Nemera designs and manufactures carry intellectual
property (IP) ownership rights, which lie with the end customer,
Nemera itself, or both parties in the case of a co-development
partnership. As of 2017, approximately 42% of the group's
revenues came from devices pure pharma-owned IP, 32% from co-
development partnerships, and the remainder from products for
which Nemera owns the IP. Despite the fact that the delivery
devices typically only account for a fraction of the overall cost
of a drug, S&P believes that the pure pharma-owned IP portion of
the business is susceptible to pricing pressure from large
clients that design the devices in-house and outsource the
manufacturing. In S&P's view, such pressure may occur especially
in the ramp-up phase of a drug production, when more device
suppliers are introduced in the supply chain, and Nemera is no
longer the sole supplier. The group has been able to improve its
profitability markedly in recent years due to a shift to a
favorable product mix and a reduction of the contribution of this
part of the business. Nevertheless, it still accounts for a
sizable 42% of revenues as of fiscal year-end 2017, which helps
explain the group's below-average profitability, in our view.

S&P said, "Nemera's top five customers (Eli Lilly,
GlaxoSmithKline, Sanofi, Astra Zeneca, and Abbott Laboratories)
accounted for about 71% of the group's revenue base as of 2017,
and we assess this level of concentration as high. In our view,
this is only partially offset by the group's longstanding
relationships (in excess of 10 years) with these key clients
spanning multiple programs and the company's positive track
record of not losing core programs to competitors.

"The stable outlook reflects our view that the group will be able
to maintain its strong market positions in all drug delivery
routes within the globally outsourced medical devices contract
manufacturing industry, enabling it to gradually deleverage to
below 7.0x while posting positive free operating cash flow (FOCF)
over the next 12-18 months.

"We could take a negative rating action if the group was unable
to achieve sufficient gains from the ramp-up of new and existing
programs in its own-IP business segment such that its EBITDA
margins failed to improve. This would most likely stem from an
inability to attract planned new business in the high-growth
ophthalmic, ear, nose, and throat, and dermal delivery routes.

"We could also lower the ratings on the group if it were to
attempt material debt-funded acquisitions or undertake
exceptional shareholder distributions, thus failing to deleverage
materially over the next 12-18 months. In particular, we could
lower the ratings on the group if, contrary to our base case, it
were unable to deleverage to below 7.0x and FOCF failed to
recover over the next 12-18 months, with little prospects for a
rapid improvement.

"A positive rating action is remote at this stage. Nevertheless,
we could consider raising the ratings on the group if the group
materially outperformed our current expectations, as well as
generated strong positive FOCF, with no material debt-funded
acquisitions or exceptional shareholder distributions. In
particular, under such a scenario, we would see credit metrics
materially improving, with adjusted debt to EBITDA falling below
5.0x and funds from operations (FFO) to debt improving to above
12%. In our view, such an improvement should come with a strong
commitment from the financial sponsor to maintain credit metrics
at such levels on a sustained basis."

Headquartered at La Verpilliere, France, Nemera is a leading
outsourced contract medical devices manufacturer. The group
designs and manufactures parenteral injectable devices, pulmonary
inhalation devices, nasal, buccal, and auricular sprays and
pumps, ophthalmic preservative-free multidisc eyedroppers, dermal
and transdermal dispensers, and airless systems. It also sells
packaging, ancillary medical products, and non-core diagnostic
products, which are in rundown mode as the group aims to focus on
medical devices manufacturing. The group's medical device
production capacity is about 750 million units delivered from
four manufacturing sites: two in France, one in Germany, and one
in the U.S. Its end customers include large and midsize pharma
groups as well as generic drugs manufacturers.

S&P said, "We forecast a return to modest positive FOCF in 2020
on the back of increasing EBITDA as the group continues to
improve its product mix. In 2019, we anticipate moderately
negative FOCF due to the group's sizeable ongoing capital
expenditure (capex) program to support existing and future
growth, as well as a one-off expenditure related to the
construction of its new headquarters in France."

S&P's base case assumes:

-- Minimal impact from economic cycles, given the relatively
    noncyclical nature of the pharma industry.

-- Growth in global pharma sales of about 3%, slower than in
    recent years due to patent expirations and a continued
    negative pricing environment for generic and some specialty
    products. Furthermore, we expect that the European contract
    drug manufacturing market will grow by 2%-3% for the next
    three years on the back of continued outsourcing from major
    pharma groups to contract drugs manufacturers.

-- Mid-single-digit revenue growth in 2018-2020 as the group
    benefits from a ramp-up of its existing programs across all
    delivery routes and from building momentum in the high-growth
    ophthalmic therapeutic area, driven by a strong contribution
    from the group's flagship device Novelia.

-- An adjusted EBITDA margin of about 18% in 2018, rising
    thereafter to just over 20% by 2020, thanks to ongoing
    operational improvements and a strong positive contribution
    from the higher-margin ophthalmic core franchise program.

-- Elevated capex at about 8%-9% of group revenues in 2018,
     rising to about 10%-11% in 2019 and falling back thereafter
     to below 10% due to new production ramp-up and the group's
    related investments in capacity extension, as well as
    extraordinary capex related to the construction of the new
    head office in France.

-- No dividends or acquisitions.

Based on these assumptions, S&P arrives at the following S&P
Global Ratings-adjusted credit measures:

-- Debt to EBITDA of about 7.2x-7.6x in 2019, improving to below
    7.0x in 2020.

-- Modestly negative FOCF in 2019, returning to low-single-digit
    positive territory in 2020.

-- FFO cash interest coverage of about 2.5x-3.0x over the next
    two years.

S&P said, "Nemera is exposed to environmental risks that could
significantly impact the group's performance if they materialize,
in our view. In particular, Nemera's manufacturing facilities are
subject to strict regulatory and quality assurance controls
related to the medical devices manufacturing process, primary
packaging, waste, and energy management, and need to have the
appropriate accreditation from the regulatory authorities to
operate. That being said, we note the group's clean track record
and lack of control issues raised by the regulators in relation
to these."


VALLOUREC SA: Creditors Seek to Cut Exposure Amid Breach Fears
--------------------------------------------------------------
Luca Casiraghi, Laura Benitez and Francois de Beaupuy at
Bloomberg News report that some Vallourec SA creditors are trying
to cut exposure to the French steel tube maker amid concerns it
will struggle to adhere to its debt commitments, according to
people familiar with the discussions.

According to Bloomberg, the people said, asking not to be
identified because the talks are private, at least two of the
firm's lenders are looking to sell their pledges to Vallourec's
revolving-credit facilities at about 75% of face value.  They
said potential buyers have been approached in London, Bloomberg
relates.  The company had EUR2.2 billion (US$2.5 billion)
of undrawn credit facilities at the end of September, Bloomberg
notes.

Bloomberg relates that Vallourec has suffered as crude and power
producers deferred or canceled projects amid successive oil
routs and competition from renewable energies.

The company manages its commercial paper program according to its
needs, a Vallourec spokesman, as cited by Bloomberg, added,
pointing to a Nov. 26 statement that described the company's
liquidity situation as "sound," citing the undrawn facilities and
EUR769 million of cash.

Morgan Stanley analysts said the company could breach a covenant
regulating its credit facilities at the end of the year,
Bloomberg relays.  To be in compliance with its loan terms,
Vallourec's net debt must not exceed its equity at the end of
2019, Bloomberg states.

The company said in November that net debt rose by a third in the
first nine months of the year to EUR2.1 billion, but that it
expects to meet its debt covenants at the end of 2019 as
continued growth in oil and gas activity and cost savings boost
earnings, Bloomberg recounts.

In addition to the credit facilities, Vallourec has EUR400
million of bonds due in August and a further EUR1.7 billion due
by 2024, according to data compiled by Bloomberg.

Headquartered in Paris, France, Vallourec is a provider of
premium tubular solutions serving Energy and Industry markets.



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


OPENHYDRO: Founders Ordered to Pay Legal Costs for Failed Rescue
----------------------------------------------------------------
Talk of the Town reports that the founders of collapsed tidal
energy firm OpenHydro have been ordered to bear the six-figure
legal costs of last year's failed bid to save the company.

According to Talk of the Town, around 100 staff in the company's
Greenore office lost their jobs when provisional liquidators were
appointed to the firm last July.

Brendan Gilmore and Donal O'Flynn tried to stop the firm's slide
into liquidation last September with an examinership petition
that was rejected by the High Court, Talk of the Town recounts.

The business owed around EUR120 million to parent company, the
French Naval Group, which had invested EUR260 million in
OpenHydro before pulling the plug on its operations, Talk of the
Town discloses.

Messrs. Gilmore and O'Flynn moved to appeal the High Court ruling
but withdrew that appeal last September when it became apparent
there was no chance of the company securing fresh investment,
Talk of the Town relates.  According to a report in The Business
Post, the High Court heard this, changed their view, and they no
longer believed OpenHydro had a reasonable chance of survival,
Talk of the Town notes.

However, on Feb. 1, they opposed an application by the French
corporate giant for them to pay the costs of the two-day
examinership hearing, Talk of the Town relays.  Barrister Neil
Steen submitted to the court that his clients, the founders and
minority shareholders, had relied on two expert reports and had
at all times acted in good faith, Talk of the Town discloses.

According to Talk of the Town, he said they had nothing to gain
from a successful examinership deal as their interest in the
company would have been extinguished.  Their aim had been to
preserve the business for the benefit of employees and the
economy as a whole, Talk of the Town states.



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


CIMPRESS NV: S&P Cuts Issuer Credit Rating to BB-, Outlook Stable
-----------------------------------------------------------------
S&P Global Ratings lowered its financial performance expectations
on Cimpress N.V. after the company recently lowered revenue
guidance for most of its business segments, stating operational
and growth challenges.

S&P lowered its issuer credit rating on Cimpress N.V. to 'BB-'
from 'BB' based on its expectation for leverage to remain in the
low-4x area over the next two years as compared to high-3x area
previously. At the same time, S&P lowered its issue-level ratings
on the company's senior secured facility to 'BB' from 'BB+' and
on the company's unsecured notes to 'B' from 'B+'."

S&P said, "The downgrade reflects our expectation that the recent
operational and growth challenges for Cimpress over the past six
months will continue, resulting in leverage remaining above 4x,
relative to our prior expectations of the company's leverage
remaining in the high-3x area over the next two years.
The stable outlook reflects our view that Cimpress's adjusted
leverage will remain in the low-4x area due to decelerating
revenue growth and relatively flat EBITDA margins as a result of
operational challenges and increased competition in the mass
customization market for print-based consumer products. We
believe that organic growth will be limited to the mid-single-
digit percentage area and that the company will maintain an
aggressive financial policy including the pursuit of acquisitions
and share repurchases at the expense of leverage reduction.

"We could lower the issuer credit rating if Cimpress makes
significant debt-financed acquisitions or share repurchases,
resulting in leverage increasing above 4.5x on a sustained basis.
We could also lower the rating if the company's operating
performance deteriorates such that revenue growth continues to
decelerate leading to flat organic or negative revenue growth and
lower profitability as a result of pricing pressures, failures in
execution of the company's growth strategy, or difficulty
achieving returns on its recent investments in the business,
including its mass customization platform and expanded product
offerings."

Improved operating performance to high-single to low-double-digit
organic revenue growth, stable or growing EBITDA margins, and a
track record and commitment to keep leverage below 4x are key
drivers for an upgrade. S&P believes an upgrade is unlikely over
the next 12 months.


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


CREDIT BANK OF MOSCOW: S&P Rates New Euro Sr. Unsec. LPNs 'BB-'
---------------------------------------------------------------
S&P Global Ratings assigned its 'BB-' long-term issue rating to
the proposed euro-denominated senior unsecured LPNs to be issued
by CREDIT BANK OF MOSCOW via its financial vehicle, CBOM Finance.
The rating is subject to its analysis of the notes' final
documentation.

S&P said, "We rate the proposed LPNs at the same level as our
long-term issuer credit rating on CREDIT BANK OF MOSCOW because
the notes meet certain conditions regarding issuance by special-
purpose vehicles (SPVs) set out in our group rating methodology.

"Specifically, we rate LPNs issued by an SPV at the same level as
we would rate equivalent-ranking debt of the underlying borrower
(the sponsor) and treat the contractual obligations of the SPV as
financial obligations of the sponsor if the following conditions
are met:

-- All of the SPV's debt obligations are backed by equivalent-
    ranking obligations with equivalent payment terms issued by
    the sponsor;

-- The SPV is a strategic financing entity for the sponsor set
    up solely to raise debt on behalf of the sponsor's group; and

-- S&P believes the sponsor is willing and able to support the
    SPV to ensure full and timely payment of interest and
    principal on the debt issued by the SPV when it is due,
    including payment of any of the SPV's expenses.

The purpose of the proposed LPNs is to finance a loan to CREDIT
BANK OF MOSCOW. The maturity of the issue is to be greater than
one year. The final terms of the issue will be defined at the
time of the notes' placement.


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


DIA: S&P Cuts Long-Term ICR to 'CCC' on Near-Term Refinancing
-------------------------------------------------------------
S&P Global Ratings lowers its long-term issuer credit rating on
DIA to 'CCC' from 'CCC+'.  S&P is also lowering its issue rating
on DIA's unsecured notes to 'CCC' from 'CCC+' and revising the
recovery rating to '4' from '3', reflecting the increased amount
of priority bank debt in DIA's capital structure following the
December 2018 refinancing.

Spain-based food retailer DIA has financed its working capital
and short-term commitments until the end of May 2019. This is the
first step in its plan to achieve a sustainable long-term capital
structure, which also includes an equity raise of at least EUR600
million. In addition, L1 Retail, DIA's largest shareholder with
29% of shares, has launched a voluntary tender offer (VTO) and
announced its intention to support a EUR500 million capital
increase, conditional on the VTO implementation and on an
agreement with DIA's lending banks regarding a viable, long-term
capital structure for DIA. S&P believes that both plans entail
significant execution risks and uncertain outcomes.

The downgrade reflects near-term refinancing risk for DIA, with
around EUR1.2 billion of debt due within the next six months.
There is also significant uncertainty and execution risk linked
to the group's plans to achieve a sustainable capital structure,
through a combination of equity raising and a new long-term bank
refinancing agreement.

S&P said, "We understand that DIA's new management is currently
in the process of reviewing and finalizing the group's market
positioning, strategic and operational focus, in light of the
various challenges it faces. We also note that as part of the VTO
announcement, L1 Retail has laid out a comprehensive
transformation plan, which it expects to deliver a turnaround of
the business over the next five years. We expect the strategic
direction of the group to evolve somewhat, depending on the final
outcome of the refinancing and equity increase."

The negative outlook reflects near-term pressures on DIA's
liquidity and funding profile, and the high execution risk of the
group's equity raise and recapitalization plan. It also reflects
the group's weak earnings and cash flow generation profile, and
the obstacles it faces to turn around its operations with its new
strategic plan in the unfavorable market context in Spain,
Brazil, and Argentina.

S&P will lower the ratings further if DIA faces difficulties in
executing its recapitalization plan, leading us to assess that a
default, distressed exchange, or restructuring will be inevitable
within six months.

S&P could revise the outlook to stable and reevaluate the issuer
credit rating if DIA is able to put in place a sustainable and
longer term capital structure.


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


CRADLE ARC: Appoints Joint Administrators from Antony Batty
-----------------------------------------------------------
Cradle Arc Plc on Jan. 31 disclosed that, further to its
announcement of December 20, 2018, it has appointed Antony Batty
-- antonyb@antonybatty.com -- and Hugh Jesseman --
hugh@antonybatty.com -- of Antony Batty & Company LLP as Joint
Administrators to the Company with immediate effect (the
"Administration").

The objective of the Administration is to enable an orderly
realization of the Company's assets with a view to maximizing
value for creditors and shareholders and, if possible, the
survival of the Company.

Headquartered in the United Kingdom, Cradle Arc Plc is a metal
exploration and production company with a producing copper mine
in Botswana and gold development project in Zambia.


FLYBE GROUP: Shareholder Clears Key Hurdle in Bid to Block Sale
---------------------------------------------------------------
Oliver Gill and Charlie Taylor-Kroll at The Telegraph report that
Flybe's biggest shareholder has cleared a key hurdle in its bid
to block the airline's cut-price sale to a consortium led by
Virgin Atlantic.

The Exeter-based carrier has accepted a call by asset manager
Hosking Partners for an extraordinary general meeting to oust
chairman Simon Laffin and conduct a "forensic examination" of its
sales process, The Telegraph relates.

A cut-price deal to sell Flybe's main operations to Connect
Airways, a new company owned by Virgin, Stobart and US investment
Cyrus Capital Partners, was struck last month, The Telegraph
discloses.

Theoretically, the extraordinary meeting need not take place for
about a month after the deal's target completion date of Feb 22,
The Telegraph states.

As reported by the Troubled Company Reporter-Europe on Feb. 5,
2018, The Financial Times related that Flybe has been struggling
with cash flow as its credit card acquirers -- companies that
process customers' payments -- had imposed tougher requirements
on the airline, withholding cash as collateral in case the
airline found itself unable to pay.

                          About Flybe

Flybe Group PLC -- https://www.flybe.com/ -- operates regional
airline in Europe.  The Company operates in two segments: Flybe
UK, which comprises the Company's main scheduled United Kingdom
domestic and the United Kingdom-Europe passenger operations and
revenue ancillary to the provision of those services, and Flybe
Aviation Services (FAS), which focuses on providing aviation
services to customers, largely in Western Europe.  The FAS
supports Flybe's United Kingdom activities, as well as serving
third-party customers.


INTERSERVE PLC: Largest Shareholder Opposes Rescue Deal
-------------------------------------------------------
Gill Plimmer at The Financial Times reports that the troubled UK
outsourcer Interserve outlined a rescue deal with banks on Feb. 6
but immediately ran into trouble as its largest shareholder
attempted to derail the proposal and demanded the ousting of the
board.

According to the FT, the company, which earns 70% of its turnover
from the UK government, said lenders and bondholders had agreed
in principle to take over the construction and support services
group, cutting its debt by more than half and swapping it for
shares, resulting in creditors owning 97.5% of the company.

But the deal provoked anger from the company's largest
shareholder, which would have its equity virtually wiped out, the
FT discloses.

Coltrane, a New York-based hedge fund that holds voting rights
accounting for around 27% of the shares, said the agreement was
"rushed out in a panic" without consultation with key
stakeholders, the FT relays, citing one person close to the
investor.  "Shareholders have been totally ignored," the FT
quotes the person as saying.

The company has been on the UK Cabinet Office's watch list of at-
risk businesses for more than a year after being plunged into
difficulty by a series of ill-timed acquisitions and by expansion
into probation, healthcare and waste-to-energy contracts, areas
in which it had no experience, the FT states.

Under the new agreement, Interserve would formally be in the
hands of banks such as BNP Paribas, HSBC and Royal Bank of
Scotland as well as lenders Davidson Kempner and Emerald
Investment, the FT notes.

Its net debt would be cut by more than half to about GBP275
million, with GBP480 million of new shares issued to current
creditors, the FT says. Existing lenders would also provide an
additional GBP75 million of liquidity through a new debt facility
maturing in 2022, according to the FT.

The stage is already set for battle after Coltrane called for a
shareholder meeting at which it intends to seek the removal of
the entire board except chief executive Debbie White, who was
brought in to revive the company's fortunes in September 2017,
the FT discloses.

According to the FT, Coltrane will be approaching other investors
for support, people with knowledge of the hedge fund's plans
said.  It has called for two restructuring experts to be
appointed to come up with an alternative plan that would protect
shareholder value and lower debt more slowly, the FT relates.
The meeting would need to be held by the end of March, the FT
notes.


ITHACA ENERGY: S&P Withdraws 'B' Long-Term Issuer Credit Rating
---------------------------------------------------------------
S&P Global Ratings said that it withdrew its 'B' long-term issuer
credit rating on Ithaca Energy Ltd. at the company's request. In
October 2018, S&P withdrew its rating on Ithaca Energy's debt
following the refinancing of its $300 million senior unsecured
notes, which resulted in the company having no publicly traded
debt obligations.

At the time of the withdrawal, the outlook was stable, reflecting
our view that Ithaca will continue to benefit from the support of
its parent company, Delek Group, and would continue to build
headroom under the rating following its acquisition of additional
interest in its operated Greater Stella Area production hub.


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


* BOOK REVIEW: Macy's for Sale
------------------------------
Author: Isadore Barmash
Paperback: 180 pages
List price: $34.95
Review by Henry Berry
Order your personal copy today at
http://www.beardbooks.com/beardbooks/macys_for_sale.html

Isadore Barmash writes in his Prologue, "This book tells the
story of Macy's managers and their leveraged buyout, the newest
and most controversial device in the modern financial armament"
when it took place in the 1980s. At the center of Barmash's story
is Edward S. Finkelstein, Macy's chairman of the board and chief
executive office. Sixty years old at the time, Finkelstein had
worked for Macy's for 35 years. Looking back over his long career
dedicated to the department store as he neared retirement,
Finkelstein was dismayed when he realized that even with his
generous stock options, he owned less than one percent of Macy's
stock. In the 185 years leading up to his unexpected, bold
takeover, Finkelstein had made over Macy's from a run-of-the-mill
clothing retailer into a highly profitable business in the lead
of the lucrative and growing fashion and "lifestyle" field.

To aid him in accomplishing the takeover and share the rewards
with him, Finkelstein had brought together more than three
hundred of Macy's top executives. To gain his support for his
planned takeover, Finkelstein told them, "The ones who have done
the job at Macy's are the ones who ought to own Macy's." Opposing
Finkelstein and his group were the Straus family who owned the
lion's share of Macy's and employees and shareholders who had an
emotional attachment to Macy's as it had been for generations,
"Mother Macy's" as it was known. But the opponents were no match
for Finkelstein's carefully laid plans and carefully cultivated
alliances with the executives. At the 1985 meeting, the
shareholders voted in favor of the takeover by roughly eighty
percent, with less than two percent opposing it.

The takeover is dealt with largely in the opening chapter. For
the most part, Barmash follows the decision making by
Finkelstein, the reorganization of the national company with a
number of branches, the activities of key individuals besides
Finkelstein, Macy's moves in the competitive field of clothing
retailing, and attempts by the new Macy's owners led by
Finkelstein to build on their successful takeover by making other
acquisitions. Barmash allows at the beginning that it is an
"unauthorized book, written without the cooperation of the buying
group." But as he quickly adds, his coverage of Macy's as a
business journalist and his independent research for over a year
gave him enough knowledge to write a relevant and substantive
book. The reader will have no doubt of this. Barmash's narrative,
profiles of individuals, and analysis of events, intentions, and
consequences ring true, and have not been contradicted by
individuals he writes about, subsequent events, or exposure of
material not public at the time the book was written.

First published in 1989, the author places the Macy's buyout in
the context of the business environment at the time: the
aggressive, largely laissez-faire, Reagan era. Without being
judgmental, the author describes how numerous corporations were
awakened from their longtime inertia, while many individuals were
feeling betrayed, losing jobs, and facing uncertain futures.
Isadore Barmash, a veteran business journalist and author, was
associated with the New York Times for more than a quarter-
century as business-financial writer and editor. He also
contributed many articles for national media, Reuters America,
and the Nihon Kenzai Shimbun of Japan. He has published 13 books,
including a novel and is listed in the 57th edition of Who's Who
in America.



                            *********

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.

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.
Marites O. Claro, Rousel Elaine T. Fernandez, Joy A. Agravante,
Julie Anne L. Toledo, Ivy B. Magdadaro, and Peter A. Chapman,
Editors.

Copyright 2019.  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.


                 * * * End of Transmission * * *