/raid1/www/Hosts/bankrupt/TCRLA_Public/051014.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
L A T I N A M E R I C A
Friday, October 14, 2005, Vol. 6, Issue 204
Headlines
A R G E N T I N A
AGUAS ARGENTINAS: Kirchner Questions Suez Commitment
AGROPECUARIA SANTA HELENA: Individual Reports Due for Filing
BANCO HIPOTECARIO: Ratings Reflect Relatively Risky Environment
CIPESUR S.A.: Judge Approves Bankruptcy Petition
CONTACTO PUBLICITARIO: Court Orders Liquidation
DANTE ZUNINO: Court Declares Company Bankrupt
LA EMILIA: Concludes Reorganization
LA RIOJANA: Liquidates Assets to Pay Debts
LOMA NEGRA: Discloses Camargo's $100M, 3-Yr. Investment
MATERIALES MENDOZA: Initiates Bankruptcy Proceedings
PINNACLE ENTERTAINMENT: Completes Amendment to Credit Agreement
B A H A M A S
ULTRAPETROL BAHAMAS: Leverage, Economic Patterns Affect Ratings
B A R B A D O S
INTERPOOL: Fitch Ups Long-Term, Preferred Debt Ratings
SUNBEACH COMMUNICATIONS: Energy Ministry OKs Telcom Deal
B R A Z I L
VARIG: Preliminary Injunction Expires on Nov. 11
* BRAZIL: Upgraded Rating Reflects Reduced Credit Vulnerability
C A Y M A N I S L A N D S
ACROPOLE LIMITED: Liquidation Report Due Nov. 3
ALMOND LIMITED: Final General Meeting to be Held Nov. 3
ARAMANDA HOLDINGS: Liquidation Update Set for Nov. 3
BCS GLOBAL: Liquidator to Explain Winding-Up Process Nov. 7
CAPTIVA FINANCE: Extraordinary Final Meeting to be Held Nov. 3
CATERING HOLDING: Shareholders' Final Meeting Set for Nov. 4
CLARE IV: Winding Up Accounting to be Presented Nov. 3
CORONATION GATEHOUSE: Final Meeting Set for Nov. 7
CORONATION SABATON: Final Meeting Details Set
DB HEDGE: To Present to Members Account of Winding Up Nov. 3
HAWTHORNE LTD: To Hold Final General Meeting Nov. 3
HUON HOLDINGS: To Lay Accounts on Liquidation Nov. 4
IRU HOLDINGS: Final Final Meeting Set for November 3
MCCONNELL ENTERPRISES: Final General Meeting Set for Nov. 11
OSCAR FUNDING: Account of Winding Up to be Presented Nov. 3
SECOND REBECCA: Final Meeting to be Held Nov. 4
SOUTHBRIDGE INVESTMENTS: To Give Account of Winding Up Nov. 3
SWEETPEA LIMITED: Final General Meeting to be Held Nov. 3
VINTAGE PETROLEUM: Final Meeting of Shareholders Set for Nov. 4
WSH INSURANCE: Liquidators to Explain Winding Up Process Dec. 6
C O L O M B I A
PAZ DEL RIO: Bocaya Department Delays Sale on Legal Problems
* COLOMBIA: Ratings Unaffected By Pending Court Ruling
C O S T A R I C A
ICE: ECI Telecom Wins $59M Contract to Install Optical Backbone
E C U A D O R
PETROECUADOR: Government Eyes Occidental for Contract Violation
E L S A L V A D O R
IFP: Fitch Affirms National Scale Rating
J A M A I C A
AIR JAMAICA EXPRESS: Terminates Flights After 10 Years
M E X I C O
ASARCO: Organizational Meeting Rescheduled to Nov. 17
GRUPO TMM: S&P Puts on CreditWatch, Positive Implications
KANSAS CITY/TFM: Moody's Affirms Debt Ratings
MINERA AUTLAN: Rising Steel Demand Bodes Well for 2006
- - - - - - - - - -
=================
A R G E N T I N A
=================
AGUAS ARGENTINAS: Kirchner Questions Suez Commitment
----------------------------------------------------
Argentine President Nestor Kirchner accused French Suez's water
concession Aguas Argentinas of taking US$5 billion from the
country while failing to make infrastructure investments,
reports AFX. Aguas Argentinas recently submitted to the
government a formal request to cancel its 30-year contract. The
request follows a breakdown in tariff talks with the
government.
According to reports, Mr. Kirchner said that what Suez's Aguas
Argentinas did to the country is "shameful."
Meanwhile, Spanish firm Aguas de Barcelona (Agbar) has also
confirmed it is pulling out of Aguas Argentinas. Spain's
ambassador to Argentina Carmelo Angulo said his country is
ready to help Argentina find a solution to the Aguas Argentinas
dispute, but it is not going to provide any funding nor buy a
stake in the operator of the water concession.
Angulo said Agbar may play a role but only as a technical
operator or manager.
Suez owns 40% of Aguas Argentinas, while Agbar has a 25% stake.
AGROPECUARIA SANTA HELENA: Individual Reports Due for Filing
------------------------------------------------------------
The individual claims of creditors against bankrupt company
Agropecuaria Santa Helena S.A. will be submitted on Nov. 14,
2005, Infobae reports. The General report is due to follow on
Dec. 2, 2005.
The La Rioja-based company was declared "Quiebra" by the city's
civil and commercial court after failing to pay its creditors.
City accountant Carlos Alberto Gomez was assigned trustee for
the liquidation. Mr. Gomez stopped verifying creditors' claims
until Oct. 7, 2005.
CONTACT: Mr. Carlos Alberto Gomez, Trustee
Hipolito Irigoyen 250
La Rioja
BANCO HIPOTECARIO: Ratings Reflect Relatively Risky Environment
---------------------------------------------------------------
CREDIT RATING:
B-/Stable/NR
Outstanding Rating(s)
Counterparty Credit: B-/Stable/NR
Senior unsecured
Foreign currency: B-
Major Rating Factors
Strengths:
- Enhanced financial profile following the completion of
its debt restructuring
- Restoration of profitability
- Increasing lending activities to the private sector and
improving asset quality
Weaknesses:
- Lack of agreement between the controlling group and the
Argentine government poses uncertainties regarding the bank's
future
- The relatively risky Argentine environment
Rationale
The ratings on Banco Hipotecario S.A. (BH) reflect the
improvement in the Argentine financial system's operating
environment since the completion of the sovereign debt
restructuring process, as well as BH's own strengthened credit
profile. This improvement in the bank's creditworthiness
includes a strong liquidity position, higher financial
flexibility, reduced rate and currency mismatches, and the
reduction in the bank's indebtedness arising from the
finalization of the entity's debt exchange in January 2004. In
addition, it comprises increasing lending activities to the
private sector, healthier asset quality, and the restoration of
the bank's profitability. These strengths are counterbalanced
by the bank's still-high concentration in mortgage lending-a
business that still shows a low potential in the Argentine
post-crisis scenario-and the recently evidenced disagreements
between the controlling group and the Argentine government, the
bank's other major shareholder. In addition, BH's credit
quality is still conditioned by its relatively high exposure to
the sovereign's creditworthiness-mostly originated by the
government bonds received as compensation for the pesification-
as is the case with the rest of the financial system.
The successful debt exchange, which included the reduction in
the bank's total debt burden and the extension of maturities,
resulted in significant improvement in BH's financial profile,
with key progress in terms of margins and solvency. As of June
2005, BH is Argentina's second-largest bank in terms of equity,
with a reported equity-to-assets ratio at 23.20%. After six
years of a declining trend in the bank's loan portfolio,
lending has regained pace. As of June 2005, the loan portfolio
shows a still low, but auspicious 4.81% quarter-over-quarter
increase, which is attributable to growing activity in the
corporate and the retail segments. Additionally, asset quality
continued to improve in the first half of 2005, with a
nonperforming ratio of 11.13% and a coverage ratio of 82.54%.
The reported income for the first half of 2005 amounts to
Argentine pesos (ArP) 81 million, equivalent to a ROAA of 1.76%
and a ROAE of 7.84%. The current direct exposure to the
Argentine government represents approximately 59% of the bank's
total assets.
Mortgage lending, the bank's core line of business in the past,
no longer embodies a significant potential in Argentina. This
situation has forced BH to devise a new strategy, seeking to
diversify its core mortgage loan lines and entering into new
business, including corporate lending and retail financing. In
February 2005, BH announced its intention to acquire Banca
Nazionale del Lavoro SpA's (BNL) operations in Argentina, a
transaction that did not materialize, in part as a result of
the disagreements between the controlling group and the
government. This acquisition would have resulted in BH becoming
Argentina's largest private financial institution in terms of
equity and lending to the private sector. This lack of
understanding between shareholders raises questions on the
ability of the controlling group to implement a consistent
business strategy, and thus, uncertainties regarding BH's
future, a factor to be monitored by Standard & Poor's Ratings
Services.
Outlook
The outlook on the bank's credit ratings follows the outlook on
the Argentine sovereign ratings.
Profile
With total assets of ArP8.9 billion (or $3.1 billion at ArP2.91
to $1) as of June 2005, BH is Argentina's sixth-largest bank in
terms of assets, and second in terms of net worth. The bank is
the country's leading private financial institution in terms of
mortgage lending. Its mortgage portfolio amounts to $1.6
billion as of June 2005 and represents 80.2% of the bank's
lending activities to the private sector. BH is headquartered
in Buenos Aires and has offices in each of the Argentine
provinces.
BH is a public company controlled by several shareholders
including IRSA, a prominent Argentine real estate company, and
several international investment funds. As a result of the
bank's privatization in 1997, the Argentine government remains
a shareholder of the institution.
The bank was established in 1886 to provide medium- and long-
term financing for home purchases and improvements, an
important government policy objective throughout the bank's
history. The Argentine government decided to privatize former
Banco Hipotecario Nacional in 1997, also changing its bylaws to
include certain clauses that define the bank's role in the
government housing policy, notably the need to balance
geographically the lending activities, some restrictions in
terms of construction lines, and special reserves to cover
losses coming from emergency economic conditions. As part of
this process, the bank was permitted to operate a retail
business. Other lines of business include life, property, and
casualty insurance, with which the bank has traditionally
improved the all-in interest rate charged to customers.
The impossibility to carry out BH's business model prior to the
crisis-mortgage lending funded with low-cost, cross-border
indebtedness-has forced the bank to devise and implement a new
business strategy. In the first stage of this process, BH has
been mainly focused on turning the bank once again into a
profitable institution. This objective was basically achieved
through restoring margins by means of the debt restructuring
and cost reductions; and achieving a situation where the bank's
free cash-flow would suffice to service reprofiled debt over
the long term. Additionally, BH has improved its financial
flexibility, increased its liquidity position, and reduced to
reasonable levels its interest rate and currency mismatch
thanks to the successful debt restructuring concluded in
January 2004. The second phase of this process embraces
resuming lending activities and entering into new businesses,
including corporate and commercial lending and retail
financing.
Financial Performance
BH was severely affected by the slowdown in the Argentine
economy at the end of the 1990s-which resulted in decreasing
lending activities-and by the economic measures taken by the
government in the aftermath of the 2002 crisis. Although the
bank was relatively unaffected by the large deposit withdrawals
that shaped the financial crisis in 2001-as it was largely
funded by dollar-denominated medium-term debt and its capital
and its direct exposure to Argentine sovereign debt was
negligible-the asymmetric devaluation created an unsustainable
currency gap. Despite the precautions taken in the past to run
a matched book between dollar-denominated loans and dollar-
denominated debt, the compulsory pesification created havoc in
the bank's long-term ability to pay down its debt.
In this context, BH decided to start a debt-restructuring
process, which had a first phase that was decidedly market
friendly. Before it launched its successful debt exchange, the
bank continued to serve its debt timely, surmounting the
difficulties of transferring foreign currency abroad. In
February 2002, the bank announced a tender offer for all of the
bonds maturing in March and October 2002, for a total amount of
approximately $300 million, to be exchanged for new notes
paying lower interest rates and maturing in 2005. This exchange
offer was successful and it refinanced the bank's most
significant debt maturities in 2002.
Still, the environment for a mortgage bank in Argentina
remained decidedly hostile. The expectations for the continued
devaluation of the peso combined with the prohibition passed by
law to foreclose assets of unpaid debts, materially affected
the willingness of debtors to pay debts on time. Furthermore,
the government modified the procedure to adjust the pesified
loans from the initial indexation to past consumer price
inflation to adjusting by the variation on average salaries
index. This further reduced the market value of the bank's loan
portfolio and increased the expected currency gap, as salaries
are anticipated to lag either devaluation or inflation.
In this scenario, BH started a second phase of its
restructuring process. This time, however, it decided to stop
payments on all of its outstanding debt to begin a
comprehensive restructuring, one giving an equitable treatment
to short- and long-term creditors. Despite the significant
challenges this process entailed-given BH's geographically
diversified and highly atomized funding base-the bank succeeded
in restructuring its $1,208.4 million bond and bank debt in
January 2004, including its EUR278.4 million long-term notes
due 2013, $449.9 million long-term notes due 2013, and $107.9
million guaranteed notes due 2010.
The successful debt exchange, which included the reduction in
the bank's total debt burden and the extension of maturities,
resulted in significant improvement in BH's financial profile,
with key progress in terms of margins and solvency. In
addition, the transaction allowed the bank to accumulate high
levels of liquidity, being able to face any potential
acquisition in the system without weakening the bank's
financial profile.
As of June 2005, BH is Argentina's second-largest bank in terms
of equity, with a reported equity-to-assets ratio at 23.20%.
Additionally, it is noteworthy that BH's balance sheet requires
fewer adjustments to become realistic, basically as a result of
the entity's lack of losses from legal injunctions on deposits
(amparos). Although BH has been concentrating on diversifying
its source of funding, customer deposits still represent a
small portion of the bank's source of funding. As of June 2005,
the customer deposits-to-funding base ratio reached 7.21% in
comparison to 3.62% at the end of 2004.
As a result of the recession affecting the Argentine economy in
1999-2001 and due to the still-low potential in the Argentine
post-crisis scenario, the bank's loan portfolio has been
decreasing during past years. After reaching ArP4.1 billion in
1998, the loan portfolio shrank to ArP2.8 million as of June
2005. Nevertheless, the declining trend in the loan portfolio
seems to have come to an end in June 2005, as it recorded a
slight but positive 4.81% quarter-over-quarter increase. This
increase is attributable to intensified lending activity in the
corporate and the retail segments, according to the
diversification strategy designed by the controlling group.
Nonmortgage lending, despite showing a consistent 72.77% year-
over-year increase, still represents a small portion of the
bank's loan portfolio.
As is the case for the whole financial system, exposure to the
government is high as a result of the bonds received in
compensation for the asymmetric pesification and other
government measures. Current direct exposure to the government-
including loans and securities-amounts to approximately ArP5.7
billion, representing approximately 59% of the bank's assets.
BH's asset quality has notably improved since 2003, with a
nonperforming ratio of 11.13% as of June 2005 (21.43% as of
December 2002). Although this indicator is still high when
compared with banks in other Latin-American countries, this
figure is in line with the Argentine financial system's average
(13.2% as of June 2005). The coverage ratio is adequate at
82.54%.
As of June 2005, BH's net income amounted to ArP81 million,
equivalent to a ROAA of 1.76% and a ROAE of 7.84%. This
earnings represents a 50.2% year-over-year decrease, which is
mainly the result of lower interest income arising from
decreasing interest margins, partially offset by lower losses
in connection with the asymmetric indexation. Although the bank
has been concentrating on developing a retail business, fee
income still represents a small portion of the bank's revenues.
As of June 2005, the fee income-to-revenues ratio is 20.29%,
while the fee income-to-noninterest expense indicator is 37.7%.
PRIMARY CREDIT ANALYSTS:
Carina Lopez, Buenos Aires
Tel: (54) 11-4891-2118
Federico Rey-Marino, Buenos Aires
Tel: (54) 114-891-2130
E-mail: federico_rey-marino@standardandpoors.com
CIPESUR S.A.: Judge Approves Bankruptcy Petition
------------------------------------------------
Cipesur S.A. was declared bankrupt after Buenos Aires' civil
and commercial court endorsed the petition of Mr. Hector
Ernesto Walker for the Company's liquidation. Argentine daily
La Nacion reports that Mr. Walker has claims totaling
$59,786.81 against Cipesur S.A.
The court assigned Ms. Elina Alicia Victorero to supervise the
liquidation process as trustee. Ms. Victorero will validate
creditors' proofs of claims until.
CONTACT: Cipesur S.A.
Rodriguez Pena 694
Buenos Aires
Ms. Elina Alicia Victorero, Trustee
Migueletes 1806
Buenos Aires
CONTACTO PUBLICITARIO: Court Orders Liquidation
-----------------------------------------------
Contacto Publicitario S.A. prepares to wind-up its operations
following the bankruptcy pronouncement issued by Buenos Aires'
civil and commercial court. The declaration effectively
prohibits the company from administering its assets, control of
which will be transferred to a court-appointed trustee.
Infobae reports that the court appointed Mr. Ruben Hugo Faure
as trustee. Mr. Faure will be reviewing creditors' proofs of
claim until Nov. 14, 2005. The verified claims will serve as
basis for the individual reports to be presented for court
approval on Dec. 27, 2005. The trustee will also submit a
general report of the case on March 9, 2006.
The case will end with the sale of the Company's assets.
Proceeds from the sale will be used to repay the Company's
debts.
CONTACT: Contacto Publicitario S.A.
Avda. Cabildo 2040
Buenos Aires
Mr. Ruben Hugo Faure, Trustee
Avda. Rivadavia 1227
Buenos Aires
DANTE ZUNINO: Court Declares Company Bankrupt
---------------------------------------------
Buenos Aires' civil and commercial court declared Dante Zunino
S.A. bankrupt, says La Nacion. The ruling comes in approval of
the petition filed by the Company's creditor, Aridos de Campana
S.A.
Trustee Beatriz Muruaga will examine and authenticate
creditors' claims until Dec. 16, 2005. This is done to
determine the nature and amount of the Company's debts.
Creditors must have their claims authenticated by the trustee
by the said date in order to qualify for the payments that will
be made after the Company's assets are liquidated.
The Company will conclude with the liquidation of the Company's
assets.
CONTACT: Dante Zunino S.A.
Av. Corrientes 2330
Buenos Aires
Ms. Beatriz Muruaga, Trustee
Aguero 1290
Buenos Aires
LA EMILIA: Concludes Reorganization
-----------------------------------
The reorganization of Buenos Aires-based La Emilia San Luis
S.A. has ended. Infobae disclosed on its Website that the
process was concluded after the city's civil and commercial
court made official the debt agreement signed between the
Company and its creditors.
LA RIOJANA: Liquidates Assets to Pay Debts
------------------------------------------
La Riojana C.C.I.S.A. will begin liquidating its assets
following the pronouncement of La Rioja's civil and commercial
court that the Company is bankrupt, Infobae reports.
The bankruptcy ruling places the Company under the supervision
of court-appointed trustee. The trustee will verify creditors'
proofs of claim until Oct. 21, 2005. The validated claims will
be presented in court as individual reports on Nov. 28, 2005.
The trustee will also submit a general report, containing a
summary of the Company's financial status as well as relevant
events pertaining to the bankruptcy, on Dec. 16, 2005.
The bankruptcy process will end with the disposal of the
Company's assets in favor of its creditors.
LOMA NEGRA: Discloses Camargo's $100M, 3-Yr. Investment
-------------------------------------------------------
Loma Negra, Argentina's biggest cement producer, revealed
Wednesday that its new owner, Brazilian engineering concern
Camargo Correa will invest US$100 million over the next three
years in the country.
In a filing to the Argentine stock exchange, Juliano de
Oliveira, Loma Negra's general director, said the three-year
program aims to "consolidate the company's leadership in
Argentina" and "explore opportunities in other markets."
Loma Negra is Argentina's largest cement maker, with nine
plants and 1,850 employees. The secretary of technical
coordination, the agency that oversees Argentina's antitrust
regulatory body, recently approved Camargo's US$1.025-billion
purchase of Loma Negra's holding company, Holdtotal.
MATERIALES MENDOZA: Initiates Bankruptcy Proceedings
----------------------------------------------------
Mendoza's civil and commercial court declared Materiales
Mendoza S.A. "Quiebra," reports Infobae. Mr. Alberto Jodar, Ms.
Aroma Renn and Mr. Carlos Vallejos, who have been appointed as
trustee, will verify creditors' claims until Nov. 3, 2005 and
then prepare the individual reports based on the results of the
verification process.
The individual reports will then be submitted to court on Dec.
21, 2005, followed by the general report on March 29, 2006.
CONTACT: Mr. Alberto Jodar
Ms. Aroma Renn
Mr. Carlos Vallejos
Trustees
9 de Julio 1357
Ciudad de Mendoza (Mendoza)
PINNACLE ENTERTAINMENT: Completes Amendment to Credit Agreement
---------------------------------------------------------------
Pinnacle Entertainment, Inc. (NYSE: PNK) announced Wednesday
that it has successfully obtained the consent of its lenders
under its credit agreement to an amendment that, among other
things, modifies the covenants in the credit agreement to
contemplate developments arising out of Hurricanes Katrina and
Rita. The amendment to the credit agreement, which has been
entered into by the Company and the administrative agent, among
other things clarifies the treatment in calculating financial
covenants of certain expected insurance recoveries, including
business interruption insurance, waives compliance with certain
financial covenants for the remainder of the year, establishes
new procedures for measuring compliance with financial
covenants in 2006 with respect to the Boomtown New Orleans and
L'Auberge du Lac properties, and establishes procedures for
ultimately rebuilding the Biloxi property.
The Company is moving forward in seeking to arrange a new,
larger bank deal to provide additional funding for its various
expansion projects and general corporate purposes.
About Pinnacle Entertainment
Pinnacle Entertainment owns casinos in Nevada, Mississippi,
Louisiana, Indiana and Argentina, owns a hotel in Missouri, and
receives lease income from two card club casinos in the Los
Angeles metropolitan area. The Company opened a major casino
resort in Lake Charles, Louisiana in May 2005 and a new casino
in Neuquen, Argentina in July 2005. Pinnacle has also been
selected for two casino development projects in the St. Louis,
Missouri area. The casino operations in St. Louis are dependent
upon final approval by the Missouri Gaming Commission.
CONTACT: Pinnacle Entertainment, Inc.
Dan Lee, Chairman & CEO
Wade Hundley, President
Steve Capp, CFO
Chris Plant, Investor Relations
Lewis Fanger, Investor Relations
Tel: +1-702-784-7777
=============
B A H A M A S
=============
ULTRAPETROL BAHAMAS: Leverage, Economic Patterns Affect Ratings
---------------------------------------------------------------
Rationale
The ratings on Bahamas-based shipping company Ultrapetrol
(Bahamas) Ltd. (Ultrapetrol) reflect its aggressive financial
profile, characterized by substantial debt leverage, an
increasing exposure to regional economic patterns (with barge
and oil products transportation services in the region),
uncertainties about its ability to consistently increase cash
flows with recently acquired vessels, sizable capital
expenditures programmed for the next couple of years that may
result in further debt leverage, and a concentrated customer
base. These negatives are partly offset by fair-to-positive
short-term prospects (particularly in the case of its
oceangoing vessels, currently servicing grain and ore trades),
a favorable market position in the barge business at the Parana
River's "Hidrovia," close relationships with the main oil
companies in South America, the long-term profile of its debt
maturity schedule (with the 2014 bond accounting for the bulk
of its debt), and some business diversification reflected in
the company's fleet profile.
Ultrapetrol is a small diversified shipping company
incorporated in the Bahamas with offices in Buenos Aires,
Argentina. Revenues, EBITDA, and total debt in the past 12
months ended June 30, 2005 amounted to $116 million, $44
million, and $213 million, respectively. The company has chosen
to diversify its business portfolio in the past couple of
years, reducing its oceangoing fleet (by selling off all
single-hull vessels) and growing its stake in river barges as
well as entering into passenger vessels. While second-quarter
2005 passenger results point toward very satisfactory
performance, the company is still expected to perform
significant refurbishment on these vessels and continue
investing in new vessels in the next couple of quarters, which
tends to compress free operating cash flows (FOCF). Revenue
sources have been increasingly diversified with the full
consolidation of this barge operation UABL, but the importance
of oceangoing revenues remains high, accounting for the bulk of
EBITDA in first-half 2005 (especially considering the
significant improvement in tariffs for the largest vessels in
this business segment).
Our projections take account of the risks of Ultrapetrol's
growth strategy in the context of relatively thin cash flows,
which might result in incremental leverage going forward. While
we have not expected Ultrapetrol to reduce debt levels anytime
soon due to its essentially long-term locked debt profile (with
most of it consisting of its 2014 preferred notes), the company
managed to paid down about $20 million in second-quarter 2005
(including debt associated with Cape Pampas), which also
contributed to ratio improvement. Additional leverage necessary
to finance new vessels, especially more expensive oceangoing
vessels, and a less speedy ramp-up in cash generation in 2006
and 2007 may well result in credit ratios stabilizing or even
deteriorating from current levels of total debt to EBITDA at
4.9x, funds from operations to total debt at 9.8%, and EBITDA
interest coverage of 2.5x (our EBITDA calculation factors in
cash drydock expenses). In particular, the company's ability to
produce cash flows as strong as in the case of bulk carriers
out of its new passenger cruise vessels must still be proven.
Liquidity
Ultrapetrol's liquidity increased in the quarter to $34.7
million in June 2005 but is partly earmarked for the
acquisition of vessels. Nonrestricted cash reserves amounted to
$30.1 million as of June 30, 2005, substantially improved from
March 2005, especially compared with short-term debt maturities
of $9.2 million in the next 12 months. Debt maturities should
not be a source of pressure in the medium term, with debt
amortizations below $6.0 million within the next couple of
years; interest burden, however, tends to be a significant
outlay, as we estimate about $20 million in annual payments
assuming the current debt amortization schedule and some new
loans already programmed to be raised ($17.5 million in the
past 12 months ended June 30, 2005).
Our projections do not incorporate the sale of some of its
existing vessels to finance the acquisition of others, but that
has been a practice for the company in the past two to three
years. In fact, the company raised about $20 million in 2003-
2004 with the sale of its old single-hull vessels, added to by
the $39.9 million for Cape Pampas this year. From now on we
expect UP Offshore to be funded by the project finance debt
already accorded, which is nonrecourse to Ultrapetrol. The
company distributed $13.4 million in dividends based on the
profits of the sale of Cape Pampas in 2005; however, we expect
Ultrapetrol to sustain a conservative dividend policy in the
future that is compatible with its fleet growth strategy.
Outlook
The negative outlook on Ultrapetrol's ratings still reflects
the vulnerability of the company to volatile market conditions
in the context of its fleet growth strategy in the near future,
despite its currently improved cash flows and cash reserves.
The outlook may be revised to stable if Ultrapetrol is able to
obtain larger cash flows from its reformatted fleet in the next
couple of quarters and to add new profitable vessels under the
limits of its liquidity and internal cash constraints
throughout 2006. The ratings may be lowered if additional debt
has to be raised to fund new vessel acquisitions, especially if
incremental cash flows coming from recently acquired vessels
turn out to be below expectations.
Primary Credit Analyst: Reginaldo Takara, Sao Paulo (55) 11-
5501-8932; reginaldo_takara@standardandpoors.com
Secondary Credit Analyst: Beatriz Degani, Sao Paulo (55) 11-
5501-8933; beatriz_degani@standardandpoors.com
===============
B A R B A D O S
===============
INTERPOOL: Fitch Ups Long-Term, Preferred Debt Ratings
------------------------------------------------------
Fitch Ratings has upgraded the long-term and preferred debt
ratings of Interpool Inc. (Interpool) and its subsidiary,
Interpool Capital Trust (see full rating list below).
Interpool's Rating Outlook remains Positive.
Approximately $470 million of unsecured debt and securities and
$650 million of secured revolving credit facilities are covered
by Fitch's actions.
The ratings reflect Interpool's strong market position within
the container and chassis segments, solid profitability,
moderate leverage, and improved liquidity.
Rating concerns center on Interpool's significant customer
concentrations, the impact of high fuel prices on global trade,
and the potential cost of repatriating accumulated earnings or
equity from Interpool Limited, which is registered in Barbados
for tax purposes. Also considered was the adverse impact of
sustained economic or political instability throughout the
Pacific Rim, particularly China.
With Interpool now current on all of its SEC-related filings
and re-listed on the New York Stock exchange, Fitch believes
that the company's operating results could improve over the
intermediate term. The improvement in operating results should
be driven by fleet utilization remaining high, and demand for
containers and chassis, which is expected to remain strong due
to major expansion of the world cellular container ship fleet
through 2008 coupled with continued growth in global
containerized traffic.
Over the intermediate term, management intends to strengthen
Interpool's credit metrics with a goal of having the company's
unsecured debt be rated investment grade. Consideration in
raising Interpool's debt from current levels will be driven by
the company's compliance with Sarbanes-Oxley section 404,
strengthening financial performance, declining leverage, and
continued unencumbering of the balance sheet.
Interpool's interim 2005 financial performance continues to
reflect favorable overall market conditions in both the
container and chassis segments. Due to higher global
containerized traffic and expansion of shipping fleets via
delivery of newer and larger ships that require the use of a
larger number of chassis and containers, utilization of
Interpool's container and chassis fleets at June 30, 2005
equaled 97% and 96%, and was 99% and 97%, respectively, at Dec.
31, 2004.
Interpool's reported net income for the first six months ended
June 30, 2005 was $37 million, an increase of $6 million over
the company's first half of 2004 net income of $31 million.
Year-to-date 2005 net income includes non-cash income of $14
million stemming from a change in the fair value of warrants.
Also, prior year net income reflected an insurance settlement
of $5 million. Excluding the change in the fair value of the
warrants, annualized return on average equity was a respectable
11.40%.
Overall credit quality also remained good. Accounts receivable
over 60 days past due equaled $9.8 million at both Dec. 31,
2004 and June 30, 2005. Nonperforming accounts receivable
totaled $12 million at June 30, 2005, compared to $13 million
at Dec. 31, 2005. Write-offs for the six months ended June 30,
2005 equaled $0.9 million versus $0.8 million for the same
period a year ago. Between the 2002 to 2004 period, annual net
write-offs have averaged approximately 0.9% of annual revenues.
New and expanded funding and liquidity arrangements were
completed during 2005 with various financial institutions.
During the first half of 2005, Interpool received an additional
$223 million in net financing commitments. As of June 30, 2005,
approximately $424 million, excluding $72 million, under the
Container Applications International, Inc. revolving credit
facility was available for future use by Interpool.
Headquartered in Princeton, N.J., with roots dating to 1968,
Interpool Inc. is the holding company for Interpool Limited
(Limited), Interpool Container Funding, SRL, Trac Lease, Inc.
(Trac Lease), and owns 50% of Container Applications
International, Inc. (CAI). Interpool Limited and Interpool
Container Funding, SRL, house the container business. Trac
Lease houses most of the domestic chassis business. CAI is a
short-term lessor and serves as an outlet for Interpool's off-
lease containers that are not renewed for long-term lease.
Interpool is publicly traded and listed on the New York Stock
Exchange (symbol:IPX).
Fitch has upgraded the following ratings:
Interpool, Inc.
-- Long-term issuer to 'BB' from 'BB-';
-- Senior unsecured debt to 'BB' from 'B';
-- Senior secured credit facility to 'BB+' from 'BB-'.
Interpool Capital Trust
-- Preferred stock to 'B+' from 'CCC+'.
Fitch has also assigned the following ratings:
Interpool Limited
-- Senior secured credit facility 'BB+';
-- Long-term issuer 'BB'.
Interpool Container Funding, SRL
-- Senior secured credit facility 'BB+';
-- Long-term issuer 'BB'.
SUNBEACH COMMUNICATIONS: Energy Ministry OKs Telcom Deal
--------------------------------------------------------
The Ministry of Energy and Public Utilities has authorized
Telcom Holdings Limited of Trinidad and Tobago to maintain
Sunbeach Communications, Inc.'s cellular license while it
acquires majority share interest in the local company. This,
according to the Barbados Nation, was revealed by LaqTel
Communications CEO Michael Barrow, who said Telcom Holdings was
moving ahead with plans to seek majority control of Sunbeach.
Telcom Holdings has placed $5 million in escrow for the buyout.
Meanwhile, the next hurdle that Telcom Holdings will have to
overcome is the lifting of the suspension imposed by the
Barbados Stock Exchange on trading of Sunbeach shares just over
a year ago.
The bourse suspended trading on Sunbeach shares on serious
doubts raised by its auditors about the Company's ability to
continue as a going concern.
===========
B R A Z I L
===========
VARIG: Preliminary Injunction Expires on Nov. 11
------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
directs that all persons subject to the jurisdiction of the
U.S. Court are enjoined and restrained from commencing or
continuing any action to collect a prepetition debt against
VARIG S.A. and its debtor-affiliates without obtaining relief
from the Court.
The Hon. Robert Drain rules that the Preliminary Injunction
will expire at the end of the day on November 11, 2005. The
Court will convene a hearing on November 9 to consider whether
to continue the terms of the Preliminary Injunction.
Objections to the continuation of the Preliminary Injunction
are due November 4.
As reported in the Troubled Company Reporter, Varig obtained a
preliminary injunction from the Bankruptcy Court enjoining and
restraining U.S. creditors from seizing its U.S. assets or
repossessing aircraft landing in United States airports.
The Court directs the Foreign Debtors to provide to their
aircraft lessors, and to any other creditors upon written
request:
(a) cash flow projections showing the Foreign Debtors'
actual
sources and uses of funds during the past three-month
period, and estimated future sources and uses of funds
through the 180-day period as provided in Section 6 of
the NBRL, together with any assumptions underlying the
projections;
(b) updated cash flow projections approximately every 30
days
showing actual sources and uses of funds on a trailing
three-month basis and any adjustments made to estimated
future sources and uses of funds or assumptions set
forth
in the most recent prior projections and assumptions;
and
(c) a fleet plan, to be updated periodically, indicating
which aircraft are expected to be operational and in use
each month by the Foreign Debtors.
The Foreign Debtors are also directed to develop a contingency
plan for the reasonable and orderly process of removing
aircraft from commercial service.
Headquartered in Rio de Janeiro, Brazil, VARIG S.A. is Brazil's
largest air carrier and the largest air carrier in Latin
America. VARIG's principal business is the transportation of
passengers and cargo by air on domestic routes within Brazil
and on international routes between Brazil and North and South
America, Europe and Asia. VARIG carries approximately 13
million passengers annually and employs approximately 11,456
full-time employees, of which approximately 133 are employed in
the United States.
The Company, along with two affiliates, filed for a judicial
reorganization proceeding under the New Bankruptcy and
Restructuring Law of Brazil on June 17, 2005, due to a
competitive landscape, high fuel costs, cash flow deficit, and
high operating leverage. The Debtors may be the first case
under the new law, which took effect on June 9, 2005. Similar
to a chapter 11 debtor-in-possession under the U.S. Bankruptcy
Code, the Debtors remain in possession and control of their
estate pending the Judicial Reorganization. Sergio Bermudes,
Esq., at Escritorio de Advocacia Sergio Bermudes, represents
the carrier in Brazil.
Each of the Debtors' Boards of Directors authorized Vicente
Cervo as foreign representative. In this capacity, Mr. Cervo
filed a Sec. 304 petition on June 17, 2005 (Bankr. S.D.N.Y.
Case Nos. 05-14400 and 05-14402). Rick B. Antonoff, Esq., at
Pillsbury Winthrop Shaw Pittman LLP represents Mr. Cervo in the
United States. As of March 31, 2005, the Debtors reported
BRL2,979,309,000 in total assets and BRL9,474,930,000 in total
debts. (VARIG Bankruptcy News, Issue No. 9; Bankruptcy
Creditors' Service, Inc., 215/945-7000)
* BRAZIL: Upgraded Rating Reflects Reduced Credit Vulnerability
---------------------------------------------------------------
Moody's Investors Service has upgraded Brazil's foreign
currency country ceiling for bonds and notes to Ba3 from B1 and
the foreign currency country ceiling for deposits from B2 to
B1. The foreign currency rating for government bonds was also
upgraded to Ba3 from B1, while the local currency rating for
government bonds was affirmed at Ba3. All ratings have a
positive outlook. Brazil's local currency guideline remains A3.
The rating agency said the upgrade reflects the presence of
steady progress on several fronts in recent years that have
combined to significantly reduce the country's credit
vulnerabilities.
Moody's said Brazil's improved credit profile is supported by
the presence of an economic policy framework that has shown
itself conducive to a stable macroeconomic environment, and
evidence of fundamental changes in the export sector that have
come to strengthen Brazil's overall export performance.
Importantly, changes observed in the government's debt
structure have served to mitigate sources of credit risks
associated with exchange rate fluctuations, a major factor
present in previous episodes of financial stress. Moody's also
noted that recent domestic political events have served to
confirm the presence of a newly acquired resilience by Brazil
to shocks of a different nature.
The commitment by Brazilian authorities to fiscal
responsibility has been evidenced by the presence of primary
surpluses of a magnitude that has been consistent with the
objective to bring about a decline in the government's debt
ratios, which has occurred, though gradually. Because
government debt ratios remain high in relative terms, Moody's
indicated that further adjustments in the fiscal accounts will
be required in the future.
Strong export growth has been a central factor in support of
the reduction reported in Brazil's external debt ratios.
Structural changes in Brazil's productive sector have served to
increase the international competitiveness of the export
sector, which, in comparison to other countries, benefits from
diversified products and markets, a condition that serves to
mitigate external shocks related to changes in the
international environment.
In spite of this, Moody's noted that, in absolute and relative
terms, Brazil's external debt burden remains sizeable and will
continue to operate as a major constraint on the country's
credit rating.
Changes in the government debt structure, a direct result of
proactive debt management on the part of the authorities, have
led to a shift in the government's credit risk profile,
virtually removing as a source of credit vulnerability the
financial impact that fluctuation in the exchange rate used to
have in the government's debt service. This has come at the
expense of increased exposure to domestic financial conditions,
which may be reduced over time if the government is able to
increase both the average maturity and the share of fixed-rate
local debt.
===========================
C A Y M A N I S L A N D S
===========================
ACROPOLE LIMITED: Liquidation Report Due Nov. 3
-----------------------------------------------
ACROPOLE LIMITED
(In Voluntary Liquidation)
The Companies Law (2004 Revision)
NOTICE is hereby given pursuant to section 145 of the Companies
Law (2004 Revision) that the extraordinary final general
meeting of Acropole Limited. will be held at the offices of
Cititrust (Cayman) Limited, CIBC Financial Centre, George Town,
Grand Cayman, on November 3, 2005, for the purpose of
presenting to the members an account of the winding up of the
company and giving any explanation thereof.
CONTACT: BUCHANAN LIMITED, Voluntary Liquidator
P.O. Box 1170GT
George Town, Grand Cayman
ALMOND LIMITED: Final General Meeting to be Held Nov. 3
-------------------------------------------------------
ALMOND LIMITED
(In Voluntary Liquidation)
The Companies Law (2004 Revision)
NOTICE is hereby given pursuant to section 145 of the Companies
Law (2004 Revision) that the extraordinary final general
meeting of Almond Limited will be held at the offices of
Cititrust (Cayman) Limited, CIBC Financial Centre, George Town,
Grand Cayman, on November 3, 2005, for the purpose of
presenting to the members an account of the winding up of the
company and giving any explanation thereof.
CONTACT: BUCHANAN LIMITED, Voluntary Liquidator
P.O. Box 1170GT
George Town, Grand Cayman
ARAMANDA HOLDINGS: Liquidation Update Set for Nov. 3
----------------------------------------------------
ARAMANDA HOLDINGS LIMITED
(In Voluntary Liquidation)
The Companies Law (2004 Revision)
NOTICE is hereby given pursuant to section 145 of the Companies
Law (2004 Revision) that the extraordinary final general
meeting of Aramanda Holdings Limited will be held at the
offices of
Cititrust (Cayman) Limited, CIBC Financial Centre, George Town,
Grand Cayman, on November 3, 2005, for the purpose of
presenting to the members an account of the winding up of the
company and giving any explanation thereof.
CONTACT: BUCHANAN LIMITED, Voluntary Liquidator
P.O. Box 1170GT
George Town, Grand Cayman
BCS GLOBAL: Liquidator to Explain Winding-Up Process Nov. 7
-----------------------------------------------------------
BCS GLOBAL FUND LTD.
(In Voluntary Liquidation)
The Companies Law (2004 Revision)
NOTICE IS HEREBY GIVEN, pursuant to section 145 of Companies
Law (2004 Revision), that the final general meeting of the sole
shareholder of the above-named company will be held at
Ansbacher House, 20 Genesis Close, George Town, Grand Cayman,
on the 7th of November 2005, at 3:30 p.m. The purpose of said
general meeting of the sole shareholder is to have laid before
him the report of the Liquidator, showing the manner in which
the winding-up of the company has been conducted, the property
of the company distributed and the debts and obligations of the
company discharged and giving any explanation thereof.
CONTACT: dms CORPORATE SERVICES LTD., Voluntary Liquidator
For enquires: Tammy Seymour
Ansbacher House
P.O. Box 31910 SMB
Grand Cayman
Telephone: (345) 946 7665
Facsimile: (345) 946 7666
CAPTIVA FINANCE: Extraordinary Final Meeting to be Held Nov. 3
--------------------------------------------------------------
CAPTIVA FINANCE II LTD.
(In Voluntary Liquidation)
The Companies Law (2004 Revision)
NOTICE is hereby given pursuant to section 145 of the Companies
Law (2004 Revision) that the extraordinary final meeting of the
above-named company will be held at the offices of Deutsche
Bank (Cayman) Limited, Elizabethan Square, George Town, Grand
Cayman, on the 3rd day of November 2005, for the purpose of
presenting to the members an account of the winding up of the
company and giving any explanation thereof.
CONTACT: DAVID DYER, Voluntary Liquidator
For enquiries:
P.O. Box 1984GT, Grand Cayman
Telephone: (345) 949 8244
Facsimile: (345) 949 5223
CATERING HOLDING: Shareholders' Final Meeting Set for Nov. 4
------------------------------------------------------------
CATERING HOLDING CO.
(In Voluntary Liquidation)
The Companies Law (2004 Revision)
NOTICE IS HEREBY GIVEN pursuant to section 145 of the Companies
Law (2004 Revision), that the extraordinary final meeting of
the shareholders of the Company will be held on November 4,
2005, at 11:00 a.m., Montevideo time, at Ruta 8, Km. 17,500,
ZonaAmerica, M1 Building, Ap. C, Montevideo, Uruguay, for the
purpose of:
i) having an account laid before them and to receive the report
of the Liquidator showing how the winding-up of the company has
been conducted and its property disposed of, and of hearing any
explanation that may be given by the Liquidator;
ii) considering the performance of the Liquidator and his
remuneration, and
iii) for considering and (if thought fit) passing a resolution
pursuant to section 158(1)(b) of the Companies Law (2004
Revision) that all the books, accounts, papers and documents of
the Company and of the liquidator be retained for a period of
five years from the dissolution of the Company, after which
they shall be destroyed, and the manner in which such books,
accounts, papers and documents shall be kept.
Any member entitled to attend and vote is permitted to appoint
a proxy to attend and vote instead of him and such proxy need
not to be a member.
CONTACT: MR. ALEJANDRO RIVERO, Voluntary Liquidator
c/o PO Box 265GT
Walker House, Mary Street
George Town, Grand Cayman
Cayman Islands
CLARE IV: Winding Up Accounting to be Presented Nov. 3
------------------------------------------------------
CLARE IV CLARE IV FUNDING CORP.
(In Voluntary Liquidation)
The Companies Law (2004 Revision)
NOTICE is hereby given pursuant to section 145 of the Companies
Law (2004 Revision) that the extraordinary final meeting of the
above-named company will be held at the offices of Deutsche
Bank (Cayman) Limited, Elizabethan Square, George Town, Grand
Cayman, on the 3rd day of November 2005, for the purpose of
presenting to the members an account of the winding up of the
company and giving any explanation thereof.
CONTACT: DAVID DYER, Voluntary Liquidator
Telephone: (345) 949 8244
Facsimile: (345) 949 5223
Address for service: P.O. Box 1984GT, Grand Cayman
CORONATION GATEHOUSE: Final Meeting Set for Nov. 7
--------------------------------------------------
CORONATION GATEHOUSE COMPANY
(In Voluntary Liquidation)
The Companies Law (Revised)
Pursuant to section 145 of the Companies Law (Revised), the
final meeting of the shareholders of this company will be held
at the registered office of the company, on 7th November 2005
at 10:00am.
Business:
1. To lay accounts before the meeting showing how the winding
up has been conducted and giving account thereof;
2. To authorize the liquidator to retain the records of the
company for a period of six years from the dissolution of the
company, after which they may be destroyed.
Proxies: Any person who is entitled to attend and vote at this
meeting may appoint a proxy to attend and vote in his stead. A
proxy need not be a member or creditor.
CONTACT: Q & H NOMINEES, LTD., Voluntary Liquidator
For enquiries: Greg Link
Telephone: 949 4123
Facsimile: 949 4647
Address for service: P O Box 1348
George Town, Grand Cayman
CORONATION SABATON: Final Meeting Details Set
---------------------------------------------
CORONATION SABATON COMPANY
(In Voluntary Liquidation)
The Companies Law (Revised)
Pursuant to section 145 of the Companies Law (Revised), the
final meeting of the shareholders of this company will be held
at the registered office of the company, on 7th November 2005,
at 10:00am.
Business:
1. To lay accounts before the meeting showing how the winding
up has been conducted and giving account thereof;
2. To authorize the liquidator to retain the records of the
company for a period of six years from the dissolution of the
company, after which they may be destroyed.
Proxies: Any person who is entitled to attend and vote at this
meeting may appoint a proxy to attend and vote in his stead. A
proxy need not be a member or creditor.
CONTACT: Q & H NOMINEES, LTD., Voluntary Liquidator
For enquiries: Greg Link
Telephone: 949 4123
Facsimile: 949 4647
P O Box 1348, George Town, Grand Cayman
DB HEDGE: To Present to Members Account of Winding Up Nov. 3
------------------------------------------------------------
DB HEDGE LIMITED
(In Voluntary Liquidation)
The Companies Law (2004 Revision)
NOTICE is hereby given pursuant to section 145 of the Companies
Law (2004 Revision) that the extraordinary final meeting of the
above-named company will be held at the offices of Deutsche
Bank (Cayman) Limited, Elizabethan Square, George Town, Grand
Cayman, on the 3rd day of November 2005, for the purpose of
presenting to the members an account of the winding up of the
company and giving any explanation thereof.
CONTACT: DAVID DYER, Voluntary Liquidator
For enquiries:
Telephone: (345) 949 8244
Facsimile: (345) 949 5223
P.O. Box 1984GT, Grand Cayman
HAWTHORNE LTD: To Hold Final General Meeting Nov. 3
---------------------------------------------------
HAWTHORNE LTD
(In Voluntary Liquidation)
The Companies Law (2004 Revision)
NOTICE is hereby given pursuant to section 145 of the Companies
Law (2004 Revision) that the extraordinary final general
meeting of Hawthorne Ltd will be held at the offices of
Cititrust (Cayman) Limited, CIBC Financial Centre, George Town,
Grand Cayman, on November 3, 2005, for the purpose of
presenting to the members an account of the winding up of the
Company and giving any explanation thereof.
CONTACT: BUCHANAN LIMITED, Voluntary Liquidator
P.O. Box 1170GT
George Town, Grand Cayman
HUON HOLDINGS: To Lay Accounts on Liquidation Nov. 4
----------------------------------------------------
HUON HOLDINGS LIMITED
(In Voluntary Liquidation)
The Companies Law (2004 Revision)
Pursuant to section 145 of the Companies Law (2004 Revision)
the final meeting of Huon Holdings Limited will be held at the
registered office of the Company on November 4, 2005, at 12:00
p.m.
Business:
1. To lay accounts before the meeting showing how the winding
up has been conducted and how the property has been disposed of
to the date of final winding up on November 4, 2005.
2. To authorize the Liquidators to retain the records of the
Company for a period of six years from the dissolution of the
Company after which they may be destroyed.
Proxies: Any person who is entitled to attend and vote at this
meeting may appoint a proxy to attend and vote in his stead. A
proxy need not be a member or creditor.
CONTACT: Mr. Lawrence Edwards, Joint Voluntary Liquidator
Jodi Smith
PO Box 219GT, Grand Cayman, Cayman Islands
Telephone: (345) 914 8694
Facsimile: (345) 949 4590
IRU HOLDINGS: Final Final Meeting Set for November 3
----------------------------------------------------
IRU HOLDINGS LIMITED
(In Voluntary Liquidation)
The Companies Law (2004 Revision)
NOTICE is hereby given pursuant to section 145 of the Companies
Law (2004 Revision) that the extraordinary final general
meeting of IRU Holdings Limited will be held at the offices of
Cititrust (Cayman) Limited, CIBC Financial Centre, George Town,
Grand Cayman, on November 3, 2005, for the purpose of
presenting to the members an account of the winding up of the
company and giving any explanation thereof.
CONTACT: BUCHANAN LIMITED, Voluntary Liquidator
P.O. Box 1170GT
George Town, Grand Cayman
MCCONNELL ENTERPRISES: Final General Meeting Set for Nov. 11
------------------------------------------------------------
MCCONNELL ENTERPRISES LTD.
(In Voluntary Liquidation)
The Companies Law (2004 Revision)
NOTICE IS HEREBY GIVEN, pursuant to section 145 of the
Companies Law, that the final General Meeting of the
Shareholders of McConnell Enterprises Ltd. (the "Company") will
be held at the offices of Voizard, Voizard, Steenackers,
Vallee, 1080, rue Valiquette, Saint-Adele, Quebec, J8B 2M3,
Canada, on 11th November 2005 at 1 p.m., for the purpose of:
Business
1. Having an account laid before the members showing the manner
in which the winding-up has been conducted and the property of
the Company disposed of and of hearing any explanation that may
be given by the liquidator; and
2. Determining the manner in which the books, accounts and
documentation of the Company and of the liquidator should be
disposed of.
Proxies: Any person who is entitled to attend and vote at this
meeting may appoint a proxy to attend and vote in their stead.
A proxy need not be a member or a creditor.
CONTACT: ANDRE VOIZARD, Voluntary Liquidator
For enquiries: Voizard, Voizard, Steenackers, Vallee
1080, rue Valiquette, Saint-Adele
Quebec, J8B 2M3, Canada
Tel: 450 229 3551
Fax: 450 229 9062
OSCAR FUNDING: Account of Winding Up to be Presented Nov. 3
-----------------------------------------------------------
OSCAR FUNDING CORP. VIII
(In Voluntary Liquidation)
The Companies Law (2004 Revision)
NOTICE is hereby given pursuant to section 145 of the Companies
Law (2004 Revision) that the extraordinary final meeting of the
above-named company will be held at the offices of Deutsche
Bank (Cayman) Limited, Elizabethan Square, George Town, Grand
Cayman, on the 3rd day of November 2005, for the purpose of
presenting to the members an account of the winding up of the
company and giving any explanation thereof.
CONTACT: DAVID DYER, Voluntary Liquidator
For enquiries: Telephone: (345) 949 8244
Facsimile: (345) 949 5223
Address for service: P.O. Box 1984GT, Grand Cayman
SECOND REBECCA: Final Meeting to be Held Nov. 4
-----------------------------------------------
SECOND REBECCA CORPORATION
(The "Company")
(In Voluntary Liquidation)
The Companies Law (As Amended)
Pursuant to Section 145 of the Companies Law (as amended), the
Final Meeting of the Shareholders of the Company will be held
at the registered office of the Company on 4th November 2005 at
1.30p.m.
Business:
1. To lay accounts before the meeting, showing how the winding
up has been conducted and how the property has been disposed
of, as at final winding up on 4th November 2005.
2. To authorize the Liquidators to retain the records of the
company for a period of five years from the dissolution of the
company, after which they may be destroyed.
Proxies: Any person who is entitled to attend and vote at this
meeting may appoint a proxy to attend and vote in his stead. A
proxy need not be a member or a creditor.
CONTACT: JOHN CULLINANE and DERRIE BOGGESS
Joint Voluntary Liquidators
c/o Walkers SPV Limited, Walker House
P.O. Box 908, George Town, Grand Cayman
SOUTHBRIDGE INVESTMENTS: To Give Account of Winding Up Nov. 3
-------------------------------------------------------------
SOUTHBRIDGE INVESTMENTS LIMITED
(In Voluntary Liquidation)
The Companies Law (2004 Revision)
NOTICE is hereby given pursuant to section 145 of the Companies
Law (2004 Revision) that the extraordinary final general
meeting of Southbridge Investments Limited will be held at the
offices of Smith Barney Private Trust Company (Cayman) Limited,
CIBC Financial Centre, George Town, Grand Cayman, on November
3, 2005, for the purpose of presenting to the members an
account of the winding up of the Company and giving any
explanation thereof.
CONTACT: BUCHANAN LIMITED, Voluntary Liquidator
P.O. Box 1170GT
George Town, Grand Cayman
SWEETPEA LIMITED: Final General Meeting to be Held Nov. 3
---------------------------------------------------------
SWEETPEA LIMITED
(In Voluntary Liquidation)
The Companies Law (2004 Revision)
NOTICE is hereby given pursuant to section 145 of the Companies
Law (2004 Revision) that the extraordinary final general
meeting of Sweetpea Limited will be held at the offices of
Cititrust (Cayman) Limited, CIBC Financial Centre, George Town,
Grand Cayman, on November 3, 2005, for the purpose of
presenting to the members an account of the winding up of the
company and giving any explanation thereof.
CONTACT: BUCHANAN LIMITED, Voluntary Liquidator
P.O. Box 1170GT
George Town, Grand Cayman
VINTAGE PETROLEUM: Final Meeting of Shareholders Set for Nov. 4
---------------------------------------------------------------
VINTAGE PETROLEUM ECUADOR, INC.
(The "Company")
(In Voluntary Liquidation)
The Companies Law (As Amended)
Pursuant to section 145 of the Companies Law (as amended), the
Final Meeting of the Shareholders of the Company will be held
at the registered office of the Company on 4th November 2005,
at 10.30 a.m.
Business:
1. To lay accounts before the meeting, showing how the winding
up has been conducted and how the property has been disposed
of, as at final winding up on 4th November 2005.
2. To authorize the Liquidators to retain the records of the
company for a period of five years from the dissolution of the
company, after which they may be destroyed.
Proxies: Any person who is entitled to attend and vote at this
meeting may appoint a proxy to attend and vote in his stead. A
proxy need not be a member or a creditor.
CONTACT: JOHN CULLINANE and DERRIE BOGGESS
Joint Voluntary Liquidators
c/o Walkers SPV Limited, Walker House
P.O. Box 908, George Town, Grand Cayman
WSH INSURANCE: Liquidators to Explain Winding Up Process Dec. 6
---------------------------------------------------------------
WSH INSURANCE COMPANY LTD
(In Voluntary Liquidation)
The Companies Law (2001 Second Revision)
(Cap. 22)
NOTICE IS HEREBY GIVEN, pursuant to section 144 of the
Companies Law (2001 Second Revised) that the final meeting of
the shareholders of the Company will be held at the offices of
Marsh Management Services Cayman Ltd., 3rd Floor,
FirstCaribbean House, 10 Main Street, George Town, Grand
Cayman, on December 6, 2005, at 10:00 a.m., for the purposes of
having an account laid before them and to receive the report of
the liquidators, showing how the winding up of the Company has
been conducted and its property disposed of, and of hearing any
explanation that may be given by the liquidators AND for the
purpose of considering and (if thought fit) passing a
resolution pursuant to section 157 (1) (b) of the Companies Law
(2001 Second Revised) that all the books, accounts, papers and
documents of the Company and of the liquidators be retained by
the liquidators for a period of two years from the dissolution
of the Company, after which they shall be destroyed.
Any member entitled to attend and vote is entitled to appoint a
proxy to attend and vote instead of him, and such proxy need
not be a member.
CONTACT: Marsh Management Services
Joint Voluntary Liquidator
P.O. Box 1051 G.T., 3rd Floor
First Caribbean House, 10 Main Street
George Town, Grand Cayman
===============
C O L O M B I A
===============
PAZ DEL RIO: Bocaya Department Delays Sale on Legal Problems
------------------------------------------------------------
The government of central Colombia's Bocaya department is
holding back the sale of its shares in steelmaker Acerias Paz
del Rio (APR), citing undisclosed legal problems. Business News
Americas reveals that the Bocaya department has a 20.91%
interest in APR.
Meanwhile, APR workers and Colombia's government have announced
plans to sell their stock in the Company in a public auction,
papers added.
APR president Gilberto Gomez Arango recently announced
preparations are underway to sell off the national government's
9.14% stake in the Company through industrial development
agency IFI and the finance ministry.
Shareholders have tapped investment bank Latinvesco Banca de
Inversion to determine the Company's value and undertake the
sale process. Workers and pensioners owning 33.89% in the
Company will be included in the process.
APR, which is currently executing an industrial restructuring
plan, has a 14% market share in the domestic steel market and
accounts for 30% of domestic production. The Company is
headquartered in the town of Belencito in central Boyaca
department.
CONTACT: Acerias Paz Del Rio S.A.
CARRERA 8A, N 13-31, PISOS 7-11
4260 - Bogota
Colombia
Phone: +57 1 3411570
+57 1 2823480
* COLOMBIA: Ratings Unaffected By Pending Court Ruling
------------------------------------------------------
Standard & Poor's Ratings Services has affirmed its 'BB/B'
foreign currency and 'BBB/A-3' local currency sovereign credit
ratings on the Republic of Colombia. The ratings agency also
said that the outlook on Colombia remains stable.
This affirmation takes place on the eve of a Constitutional
Court ruling on an amendment and on an election guarantees law
that would allow presidents to stand for a second consecutive
term. Neither outcome of the ruling would affect the ratings.
"Standard & Poor's expects the main lines of policy on economic
and security matters to be maintained regardless of who stands
and wins the next presidential election in May 2006," said
Standard & Poor's credit analyst Richard Francis. "Improved
domestic security has underpinned domestic confidence and
improved the country's investment climate." Partly as a result,
GDP growth has risen to more than 4% this year, and the general
government fiscal balance has improved, falling to close to 3%
of GDP in both 2004 and 2005 from nearly 4% in 2003.
Notwithstanding the improved economic prospects, the government
faces significant challenges because of its high interest
burden (nearly 16% of revenue), the need to increase military
expenditure, and the rising cash deficits in the state-run
pension systems. Furthermore, despite significant security
advances, domestic confidence and thereby investment could
falter if guerrilla warfare intensifies.
"Improved economic prospects--coupled with stronger external
indicators--will underpin the ratings on Colombia over the next
two years," Mr. Francis added. "However, the government's
underlying fiscal position is constrained by large, legally
mandated transfers to local governments and public pension
systems in addition to the interest on its debt. Therefore, tax
hikes, transfer reductions, and pension reform will be needed
over the next three years to maintain fiscal discipline. If
fiscal prospects improve and the debt and interest burdens
decline, the ratings could improve. On the other hand, fiscal
slippage or a deterioration in national security could result
in renewed downward pressure on the government's
creditworthiness."
Primary Credit Analyst: Richard Francis, New York (1) 212-438-
7348; richard_francis@standardandpoors.com
Secondary Credit Analyst: John Chambers, CFA, New York (1) 212-
438-7344; john_chambers@standardandpoors.com
===================
C O S T A R I C A
===================
ICE: ECI Telecom Wins $59M Contract to Install Optical Backbone
---------------------------------------------------------------
ECI Telecom (NASDAQ:ECIL) has signed an agreement with ICE
(Instituto Costarricense de Electricidad), a government owned
utility company in Costa Rica, to provide it with an advanced
backbone network across Costa Rica, enabling telecommunication
traffic routing throughout the country. This turnkey project
calls for ECI to deploy a complete optical transmission network
and the entire infrastructure installation, based on its XDM(R)
Multi-Service Provisioning Platform (MSPP). The network will
provide ICE with the needed capacity to deliver voice and data
services to fixed and mobile subscribers. The project is worth
$59 million. Deployment is expected to start in approximately 3
months and be completed over a 21-month period. The contract is
subject to final approval by the General Comptroller of Costa-
Rica.
The project includes the delivery and installation of ECI's XDM
converged SDH and DWDM optical platforms, which enable up to 40
channels of 10 Gigabits each, meeting the long-term bandwidth
capacity needs of ICE. In addition, the XDM platform handles
ATM, point-to-point IP and Gigabit Ethernet, giving ICE an
advanced network architecture for future services and
expansion. The XDM will be managed by LightSoft(R), ECI's
state-of-the-art multi-dimensional management system, which
incorporates different technology layers to allow operators
multiple technology-centered views of the network, including
SDH/SONET, optics, and Ethernet.
Under the terms of the contract, ECI will provide all aspects
of the fiber installation and design, supply the fiber optic
cables, digging of the fiber canals and ducting the fiber
installation works of over 1000 km across the urban and rural
areas of Costa Rica.
"ECI is proud to be selected by ICE to deliver a world-class
network for Costa Rica," said Israel Rozen, Vice President of
Turnkey Projects at ECI Telecom. "ICE's visionary leadership
for providing its customers the most advanced voice and data
services promises to be exciting. It is a pleasure for ECI to
have the opportunity to be part of such an important
initiative."
"We selected ECI as their single-platform technology is very
advanced, providing us with the needed flexibility for future
services," said Claudio Bermudez, Telecommunications General
Manager of ICE. "This is one of the largest and most strategic
infrastructure projects in Costa Rica, and we have great
confidence in ECI's field-proven experience to undertake such a
important turnkey assignment."
"We believe that the XDM is an optimal solution in the
deployment of new backbone wireline networks, as it supports a
full range of applications and protocols over a single, cost-
effective platform," said Doron Inbar, President and CEO of ECI
Telecom. "This order further reinforces ECI's reputation as a
leading provider in the fast-growing MSPP market."
About ICE
ICE, (Instituto Costarricense de Electricidad), a governmental
agency, is the Costa Rican electricity institute. ICE is the
sole telecommunications provider in Costa Rica.
About ECI Telecom
ECI provides advanced telecommunications solutions to leading
carriers and service providers worldwide. By translating a deep
understanding of their needs into innovative, technologically
advanced solutions, ECI enables its customers to increase the
value of the infrastructure of their networks and reduce
operating expenses. ECI's platforms provide carriers and
service providers with carrier-grade solutions for easily
introducing new revenue-generating services.
ECI provides innovative IP service delivery solutions to the
converged telecom networks encompassing Broadband access
gateways, Service Edge Routers, Optical transport, Core IP/MPLS
routers, NGN VoIP and multimedia applications and services. ECI
maintains a global sales, marketing and customer support
network, as well as a host of strategic channel relationships
worldwide.
CONTACT: ECI Telecom
Investor Relations: Jay Kalish
Tel: +972-3-926-6255
E-mail: jay.kalish@ecitele.com
or
Media Relations: Karen Gershon
Tel: +972-3-926-8341
E-mail: Karen.gershon@ecitele.com
or
PR@vantage
Fran Bosecker, +1-212-532-5740
fbosecker@pr-vantage.com
=============
E C U A D O R
=============
PETROECUADOR: Government Eyes Occidental for Contract Violation
---------------------------------------------------------------
The Ecuadorean government is studying whether Occidental
Petroleum Corp. breached the contract with state oil firm
Petroecuador when it transferred 40% of its Block 15 area to
Canadian firm EnCana Corp., Reuters reports.
Energy Minister Ivan Rodriguez is looking for grounds to cancel
Occidental's contract and take over Block 15, which produces
20% of Ecuador's total 530,000 barrels per day crude oil
output.
Occidental would be able to appeal any such ruling both in
Ecuador and abroad.
Occidental denied any violation in the contract and said that
if the government takes over the area it would be tantamount to
confiscation of its assets. Occidental has invested $1 billion
in Ecuador, where it operates several areas.
According to Occidental's executive director in Ecuador Gerald
Ellis, Occidental is looking for a chance to negotiate with the
government to end the dispute and continue working in a
business environment.
Occidental said Wednesday that its investment plans in the
country were in doubt. "If we can't resolve our problems, it's
going to be very difficult to comply with our plans," Ellis
said.
Ellis revealed that Occidental plans to invest $100 million in
Ecuador in 2006.
The dispute began after an international tribunal ordered
Ecuador to pay Occidental $75 million for excluding it from tax
reductions granted to other companies. Ecuador is currently
appealing that ruling.
Negotiating an end to the controversial dispute would be
politically tough for President Alfredo Palacio. Because he
only took power after the Congress fired his predecessor
President Lucio Gutierrez in April for meddling with the
Supreme Court, he has little firm support in Congress.
=====================
E L S A L V A D O R
=====================
IFP: Fitch Affirms National Scale Rating
----------------------------------------
Fitch Ratings has affirmed its BB+(slv) long-term national
scale rating and the B(slv) short-term rating on financial
holding company Inversiones Financieras Promerica (IFP) with a
stable outlook, reports Business News Americas.
The action reflects the risk exposure of IFP's only subsidiary,
niche bank Banco Promerica, which has a BB+(slv) long-term
rating and B(slv) short-term rating.
IFP's concentration on consumer lending has brought its net
interest income to a near historic high.
Nevertheless, profitability has been limited by the lack of
revenue diversification and the expansion of its geographic
footprint.
=============
J A M A I C A
=============
AIR JAMAICA EXPRESS: Terminates Flights After 10 Years
------------------------------------------------------
Domestic carrier Air Jamaica Express, which is controlled by
Gordon "Butch" Stewart's ATL Group, will stop flying today,
ending 10 years of service on the route that many Jamaicans
depend on. Last month, Air Jamaica Express explained its
management decided to suspend operations in the face of
prevailing market conditions, which include record high
increases in fuel and other operational costs and ongoing
turbulence in the local and global aviation industry.
Air Jamaica was the only carrier licensed to provide scheduled
flights within Jamaica, although other companies offered
charter and freight services. Until recently, it also operated
flights from Kingston to Cuba, the Bahamas, Turks and Caicos,
the Dominican Republic, and the Cayman Islands.
Meanwhile, the dent left by Air Jamaica Express will be filled
by International Airlink, says Captain Howard Levy, managing
director of the Montego Bay based airline.
In an exclusive interview with Hospitality Jamaica, Captain
Levy outlined his plans to add another 1900D Beechcraft to his
fleet, expanding the current service of five daily flights
between Montego Bay and Tinson Pen.
"We will increase our frequency into Kingston by one or two
flights, but within a few months, we will have the other
aircraft in the skies," he said.
===========
M E X I C O
===========
ASARCO: Organizational Meeting Rescheduled to Nov. 17
-----------------------------------------------------
The United States Trustee has rescheduled the statutory meeting
of ASARCO LLC's creditors pursuant to Section 341 of the U.S.
Bankruptcy Code to Nov. 17, 2005, at 10:30 a.m. The meeting
will be held on the 16th floor of the Wilson Plaza Building
located at 606 North Carancahua in Corpus Christi, Texas.
All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible officer of
the Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.
Headquartered in Tucson, Arizona, ASARCO LLC --
http://www.asarco.com/-- is an integrated copper mining,
smelting and refining company. Grupo Mexico S.A. de C.V. is
ASARCO's ultimate parent. The Company filed for chapter 11
protection on Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-
21207). James R. Prince, Esq., Jack L. Kinzie, Esq., and Eric
A. Soderlund, Esq., at Baker Botts L.L.P., and Nathaniel Peter
Holzer, Esq., Shelby A. Jordan, Esq., and Harlin C. Womble,
Esq., at Jordan, Hyden, Womble & Culbreth, P.C., represent the
Debtor in its restructuring efforts. When the Debtor filed for
protection from its creditors, it listed $600 million in total
assets and $1 billion in total debts.
The Debtor has five affiliates that filed for chapter 11
protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-
20521 through 05-20525). They are Lac d'Amiante Du Quebec
Ltee, CAPCO Pipe Company, Inc., Cement Asbestos Products
Company, Lake Asbestos of Quebec, Ltd., and LAQ Canada, Ltd.
Details about their asbestos-driven chapter 11 filings have
appeared in the Troubled Company Reporter since Apr. 18, 2005.
Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304),
Encycle, Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex.
Case No. 05-21346) also filed for chapter 11 protection, and
ASARCO has asked that the three subsidiary cases be jointly
administered with its chapter 11 case. (ASARCO Bankruptcy
News, Issue No. 7; Bankruptcy Creditors' Service, Inc.,
215/945-7000).
GRUPO TMM: S&P Puts on CreditWatch, Positive Implications
---------------------------------------------------------
Rationale
The rating on Mexico City-based Grupo TMM S.A. (TMM) was placed
on CreditWatch with positive implications on Dec. 15, 2004. The
action followed KCS' announcement that it reached an agreement
with TMM to take control of TFM S.A. de C.V. (TFM) As a result
of this transaction, TMM received $200 million in cash (which
was used to prepay debt), 18 million shares of KCS, and $47
million in a two-year promissory note.
On Sept. 13, 2005, TMM, along with KCS and its subsidiaries TFM
and Grupo Transportacion Ferroviaria Mexicana S.A. de C.V.,
entered into a settlement agreement with the Mexican government
resolving issues related to the payment of a value-added tax
refund to TFM and the purchase of the remaining shares of TFM
owned by the Mexican government. Compliant with the amended
acquisition agreement between TMM and KCS dated Dec. 15, 2004,
TMM will be paid $110 million in a combination of cash, notes,
and stock by KCS.
Standard & Poor's Ratings Services estimates TMM's shareholder
position in KCS should be close to 25%. TMM has not made any
public statement on the use of proceeds of either its
shareholder position or the use of cash. Our analysis will
focus on the debt reduction and business strategies of the
company.
Primary Credit Analyst: Juan P Becerra, Mexico City (52) 55-
5081-4416
Secondary Credit Analyst: Jose Coballasi, Mexico City (52)55-
5081-4414; jose_coballasi@standardandpoors.com
KANSAS CITY/TFM: Moody's Affirms Debt Ratings
---------------------------------------------
Approximately $1.5 billion of debt affected
Moody's Investors Service affirmed the ratings of Kansas City
Southern Railway ("KCSR") and its parent company Kansas City
Southern ("KCS") -- corporate family at B1; and the ratings of
TFM S.A. de C.V. ("TFM") -- corporate family rating at B2.
Moody's also changed the outlook for the ratings of both
companies to Stable from Negative.
The change in outlook is based on: 1) reduced financial risk
following the completion of a series of transactions whereby
KCS now owns 100% of TFM and the dismissal of various related
claims (principally a potential put to KCS of TFM shares
formerly held by the government of Mexico); and 2) the
favorable operating environment for both KCR and TFM with the
expectation of steady improvement in the respective financial
results.
Although KCS now owns TFM, Moody's does not expect that KCS or
KCSR will guaranty TFM's debt, nor will TFM provide an upstream
guaranty for KCSR obligations. As a result, Moody's will
continue to view the debt ratings of KCR and TFM separately.
Moody's ratings will consider the value to KCR and TFM from
better coordination of the respective rail networks now under
common control, and the benefits from resolution of long-
standing disputes with the former controlling shareholder of
TFM.
KCSR's ratings take into account the geographically attractive
location of its railroad property, the high level of asset
protection, and the recently improved fluidity of its railroad
operations. Also, with full control of TFM and the dismissal of
all related claims, KCSR is potentially a more attractive
merger candidate for another Class I railroad. Although Moody's
does not believe that any transaction is imminent, Moody's
notes that the regulatory review of any transaction involving
KCR would be under the former merger rules, which were more
encouraging of railroad consolidation than the current
guidelines.
KCSR's ratings also consider the high level of financial
leverage, KCSR's comparatively high operating cost structure,
and the expectation of breakeven free cash flow despite the
strong demand for rail transportation at present. Also, KCSR's
operating infrastructure could require considerable incremental
investment to handle the higher levels of demand, particularly
a need for investment in KCSR's rolling stock. The funding
required for any incremental investments, when combined with
the expectation of breakeven to only modestly positive free
cash flow, could result in even higher debt levels than at
present. The potential for incremental debt financed investment
limits the upward movement in KCSR's ratings at the present
time. However, the ratings could be considered favorably should
KCSR produce consistently positive free cash flow, reduce the
ratio of debt to EBITDA (using Moody's standard adjustments) to
less than 4.5x, and sustain a significant increase in operating
profit.
TFM's ratings reflect the favorable location of its extensive
railroad network in Mexico, which connects the manufacturing
plants in the country's industrial regions to the principal
border crossing into the U.S. The railroad is well positioned
to benefit from the expectation of continued high trade between
volumes Mexico and the U.S. and further penetration of the
railroad for freight transport in the Mexican domestic market.
Moreover, the railroad's inherently low operating cost,
principally because of low labor rates should support earnings
potential. Offsetting these strengths, however, are TFM's high
level of debt, a considerable exposure to the auto segment
through new vehicle and parts shipments, as well as weaker than
historic levels of operating results. While TFM has been free
cash positive, this has been the result of lower than expected
level of capital expenditures recently. Moody's believes that
TFM could need to invest a much larger amount in its track
network and rolling stock over the near term to handle
additional traffic and catch up from lower recent investment.
Similar to KCSR, the potential for incremental debt financed
investment limits upward movement in TFM's ratings at this
time. The ratings or the outlook could be under downward
pressure should the company not make steady progress to restore
its operating ratio to historic levels below the current 80%
level, or if leverage as measured by debt to EBITDA (using
Moody's standard adjustments) increases to higher than 6x.
Moody's believes that KCS' full control of TFM improves the
credit characteristics of both companies, and provides KCS with
more options for realizing return on its considerable
investment in TFM. TFM operations are likely to improve from
the more disciplined operating systems under KCSR ownership, as
well as from better coordination with KCSR to develop longer
lengths of haul. TFM has hired new executive management,
including a new chief executive officer and chief financial
officer, both with local transportation experience. TFM will
now be reporting using US GAAP (rather than IAS), and will be
required to comply with all US public reporting requirements
(10-Q, 8-K, etc.), which contributes to the transparency of TFM
operations. The company is also taking steps to improve its
liquidity, and TFM has already refinanced its largest bond by
extending the maturity and lowering the coupon. If the
refinancing of its credit agreement is completed, the company
will have little debt principal maturities until 2007 when it
has $150 million of notes due, and should have a modest level
of committed revolving credit availability.
Ratings affected:
- Kansas City Southern Railway Senior secured bank facilities
affirmed at Ba3; senior unsecured affirmed at B2; corporate
family rating withdrawn and reassigned at Kansas City Southern
- Kansas City Southern Corporate family rating assigned at B1;
Convertible preferred affirmed at Caa1
- TFM, S.A. de C.V. Senior unsecured and corproate family
ratings affirmed at B2
Kansas City Southern, based in Kansas City MO, operates a Class
I railroad in the U.S. and owns TFM S.A. de C.V. TFM S.A. de
C.V., based in Monterrey Mexico, owns the concession to operate
a railroad throughout the northeastern sections of Mexico
MINERA AUTLAN: Rising Steel Demand Bodes Well for 2006
------------------------------------------------------
Manganese-ferroalloy producer Minera Autlan (BMV: AUTLANB)
expects the worldwide increase in demand for steel next year to
help improve its operations, reports Business News Americas.
The Brussels-based International Iron and Steel Institute
(IISI) recently predicted North American steel demand would
grow 3% in 2006 and worldwide demand 4-5%. For Autlan,
increased steel demand will mean increased consumption of
ferroalloys.
Autlan also expects demand for fine steels with low carbon
content to increase in 2006, translating into a greater need
for refined ferromanganese. This will especially benefit
Autlan's business with the US, as the Company provides nearly
20% of the low-carbon ferromanganese the US imports.
Based in the northern Mexican city of Monterrey, Autlan
reported a five-fold increase in net profit in the second
quarter 2005 to MXN215 million (US$20.3mn) compared to same-
period last year.
***********
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 - Latin America is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Fairless
Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick,
Maryland USA. John D. Resnick, Edem Psamathe P. Alfeche and
Sheryl Joy P. Olano, Editors.
Copyright 2005. All rights reserved. ISSN 1529-2746.
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 Latin America subscription rate is $575 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 $25 each. For subscription
information, contact Christopher Beard at 240/629-3300.
* * * End of Transmission * * *