/raid1/www/Hosts/bankrupt/TCRLA_Public/060522.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
Monday, May 22, 2006, Vol. 7, Issue 100
Headlines
A R G E N T I N A
ASOCIACION ARGENTINA: Moves to Restructure Debts
BALDONI S.R.L.: Proofs of Claim Filing Ends on June 12
BELGRANO 561: Sets June 29 Deadline for Proofs of Claim Filing
CAMUZZI GAS: Issues US$50 Million in Floating Rate Bonds
NOROS S.R.L.: Enters Bankruptcy on Court Orders
NORTE ASISTENCIA: Court Confirms Debt Restructuring Proposal
OPTIMUS SA: Court Approves Reorganization Petition
SAN JORGE: Asks Court's Approval to Reorganize Business
SARACCO Y TEJEDO: Court Appoints Cerchio Botta as Bank. Trustee
SAVIO MATERIALES: Proofs of Claim Filing Deadline on June 20
TERCER MILENIO: Individual Reports Due in Court on June 30
B A H A M A S
WINN-DIXIE: Trade Panel Wants to Examine Sr. Notes' Underwriters
WINN-DIXIE: Trade Panel Wants Debtors' Substantial Consolidation
WINN-DIXIE: US Bankruptcy Court Okays Sale of 12 Supermarkets
B E L I Z E
PETROLEOS DE VENEZUELA: Proposes Oil Alliance with Belize
B E R M U D A
FOSTER WHEELER: Names Raymond Milchovich as New Global Group CEO
INTELSAT LTD: Appoints Senior Management Members to Finance Team
B O L I V I A
* BOLIVIA: Refuses Gas Pipeline Project with Petroleo Brasileiro
* BOLIVIA: Will Participate in Trade Fair with Cuba & Venezuela
B R A Z I L
BANCO ITAU: S&P Raises LT Counterparty Credit Rating to BB+
COMPANHIA VALE: Chinese Rejects 19% Iron Ore Hike With Japanese
COSAN SA: Selling ADRs to Finance Business Expansion
PETROLEO BRASILEIRO: Bolivia Refuses Gas Pipeline with Company
USINAS SIDERURGICAS: S&P Upgrades LT Credit Rating to BB+
VIACAO ITAPEMIRIM: Issues US$45 Million in Global Bonds
C A Y M A N I S L A N D S
AERCAP A BORDEAUX: Holds Last Shareholders Meeting on June 5
ARIAU LTD: Sets May 31 Deadline for Proofs of Claim Filing
CONCORD INVESTMENTS: Filing of Proofs of Claim Ends on June 1
CRESCENT MEDIA: Proofs of Claim Filing Deadline on June 1
SISYPHOS: Verification of Proofs of Claim Ends on June 1
URIZEN ACQUISITIONS: Proofs of Claim Must be Filed by June 3
C H I L E
GLOBAL CROSSING: Annual Shareholders' Meeting Set for June 13
C O L O M B I A
* COLOMBIA: Gas Supplies Cut Off Due to Damage in Pipeline
C O S T A R I C A
* COSTA RICA: Minister Denies Rumors on Daylight Saving Time
* COSTA RICA: Wants Banana Exclusion from Trade Pact with Europe
C U B A
* CUBA: Will Participate in Trade Fair with Venezuela & Bolivia
D O M I N I C A N R E P U B L I C
AES CORP: Acquires 25% Stake on 432-MW Power Plant for US$25M
BANCO BHD: Fitch Upgrades LT Foreign Currency Rating to B
REPUBLIC BANK: Fitch Upgrades LT Foreign Currency Rating to B
* DOMINICAN REPUBLIC: Free Trade with US Takes Effect on July 1
E C U A D O R
PETROECUADOR: Renews Contract with Repsol YPF
REPSOL YPF: Renews Contract with Ecudorian State-Run Oil Firm
E L S A L V A D O R
* EL SALVADOR: Ministry to Present Reform on Hydrocarbons Law
G U A T E M A L A
* GUATEMALA: Venezuela Willing to Supply Discounted Crude
H O N D U R A S
* HONDURAS: Union Members Protest Creation of New Telecoms Law
J A M A I C A
AIR JAMAICA: Foreign Affairs Minister Proposes Merger with BWIA
M E X I C O
AXTEL SA: Launches Operations in Celaya, Guanajuato
DIRECTV GROUP: Buys Common Stock from GM Trust for US$265 Mil.
GENERAL MOTORS: Pension Fund Sells Stock to DIRECTV for US$265M
GRUPO IUSACELL: Extends Deadline for Exchange Offer to June 1
KANSAS CITY SOUTHERN: S&P Lowers Preferred Stock Rating to D
MERIDIAN AUTOMOTIVE: CSFB Seeks Claims Partial Summary Judgment
PROGRESS RAIL: Inks US$1-Bil. Merger Agreement with Caterpillar
PROGRESS RAIL: Caterpillar Merger Cues Moody's to Review Ratings
N I C A R A G U A
* NICARAGUA: Liberal Party Balks at Oil Accord with PDVSA
P A N A M A
* PANAMA: Reduction in Fuel Prices to Remain Until May 31
P E R U
* PERU: Begins Drilling Operation on Gas Block 56
* PERU: Minister Proposes Law on Voluntary Payment of Royalties
P U E R T O R I C O
BURGER KING: Prices 25M Common Stock Offering at US$17 per Share
DORAL FINANCIAL: Closes Repurchase & Resale of US$608M Loans
DORAL FINANCIAL: Gets Approval to Pay Dividends on Stock
GLOBAL HOME: Wants to Hire Houlihan Lokey as Investment Banker
KMART CORP: Court Allows NJ Tax Court to Adjudicate 2005 Appeal
MUSICLAND HOLDING: Committee Has Until June 1 to File Claim
T R I N I D A D & T O B A G O
BWIA WEST: Jamaican Minister Proposes Merger with Air Jamaica
RBTT FINANCIAL: Appoints Suresh Sookoo as Chief Exec. Officer
V E N E Z U E L A
CITGO PETROLEUM: Will Sell Six Refineries in United States
PETROLEOS DE VENEZUELA: CLP Balks at Accord with Mayors
PETROLEOS DE VENEZUELA: Sells Discounted Oil to Guatemala Towns
* VENEZUELA: Chinese Firm Opening Car Assembly Plant in Country
* VENEZUELA: Will Participate in Trade Fair with Cuba & Bolivia
- - - - -
=================
A R G E N T I N A
=================
ASOCIACION ARGENTINA: Moves to Restructure Debts
------------------------------------------------
Court No. 22 of Buenos Aires' civil and commercial tribunal is
studying the request for reorganization submitted by local
company Asociacion Argentina de Trabajadores Autonomos, says La
Nacion.
The report adds that that the Company filed the reorganization
petition following cessation of debt payments on Feb. 15, 2006.
Under Insolvency protection, the company will be able to draft a
proposal designed to settle its debts with creditors. The
reorganization also prevents an outright liquidation
The city's Clerk No. 44 assists the court on this case.
The debtor can be reached at:
Asociacion Argentina de Trabajadores Autonomos
Mario Bravo 470
Buenos Aires, Argentina
BALDONI S.R.L.: Proofs of Claim Filing Ends on June 12
------------------------------------------------------
Creditors against bankrupt company Baldoni S.R.L. are required
to submit their proofs of claim by June 12, 2006, to a court-
appointed trustee whose name is yet to be disclosed, Infobae
relates. The claims will then undergo a verification phase.
Argentine bankruptcy law requires the trustee to provide the
court with individual reports on the forwarded claims and a
general report containing an audit of the company's accounting
and business records.
The court has not yet disclosed the deadlines for submission of
these reports.
Infobae adds that a Cordoba court handles this case.
The debtor can be reached at:
Baldoni S.R.L.
Paraje el Socavon Pedania Caseros0
Cordoba, Argentina
BELGRANO 561: Sets June 29 Deadline for Proofs of Claim Filing
--------------------------------------------------------------
Creditors of bankrupt company Belgrano 561 S.A. are required to
present proofs of their claim to Irma Juana Aguilera, the court-
appointed trustee, on or before June 29, 2006, La Nacion
reports. Creditors who fail to submit the required documents by
June 29 will not qualify for any post-liquidation distributions.
Buenos Aires' Court No. 4 declared the company bankrupt at the
behest of Jaime Martin Chaile, whom the company owes
US$17,170.85.
Clerk No. 7 assists the court on the case.
The debtor can be reached at:
Belgrano 561 S.A.
Avenida Belgrano 561
Buenos Aires, Argentina
The trustee can be reached at:
Irma Juana Aguilera
Presidente Luis Saenz Pena 1690
Buenos Aires, Argentina
CAMUZZI GAS: Issues US$50 Million in Floating Rate Bonds
--------------------------------------------------------
Camuzzi Gas Pampeana, a natural gas distributor in Argentina,
issued class 3 bonds worth US$50 million in a public offering
last week, local daily Ambito Financiero reports.
Ambito Financiero states that the three-year bonds will hold a
floating interest rate based on each quarter's Badlar rate,
which is at 9%, and a 4% annual rate.
ABN Amro and Banco Comafi were the placing agents for the bond
issue, Business News Americas relates.
Camuzzi Gas Pampeana S.A. serves most of the province of Buenos
Aires -- excluding the city of Buenos Aires and the greater
metropolitan area of Buenos Aires -- and the Province of La
Pampa, encompassing primary industrial and residential areas.
The company operates a 3,500-kilometer pipeline network and a
17,600-kilometer distribution network and its primary
shareholder is Sodigas Pamapena, which has an 86.09% interest.
* * *
As reported in the Troubled Company Reporter on April 17, 2006,
Moody's Investors Service assigned a B2 global local currency
rating and an A2.ar national scale rating to Camuzzi Gas
Pampeana's issue of up to ARS75 millions senior unsecured Class
3 notes with a stable outlook.
NOROS S.R.L.: Enters Bankruptcy on Court Orders
-----------------------------------------------
Noros S.R.L. enters bankruptcy protection after a court in
Rosario, Santa Fe, ordered the company's liquidation. The order
effectively transfers control of the company's assets to a
court-appointed trustee who will supervise the liquidation
proceedings.
Argentine bankruptcy law requires the trustee to provide the
court with individual reports on the forwarded claims and a
general report containing an audit of the company's accounting
and business records.
The name of the trustee, the claims verification deadline and
the dates of submission of the reports are yet to be disclosed.
The debtor can be reached at:
Noros S.R.L.
Cochabamba 4723 Rosario
Santa Fe, Argentina
NORTE ASISTENCIA: Court Confirms Debt Restructuring Proposal
------------------------------------------------------------
The settlement plan proposed by Norte Asistencia Empresaria S.A.
to its creditors acquired the number of votes necessary for
confirmation. The company's creditors had approved the
company's settlement during the informative assembly on Nov. 11,
2005.
The plan has been endorsed by Buenos Aires Court No. 13 and will
now be implemented by the company.
On Jan. 20, 2005, the Troubled Company Reporter stated that
Court No. 13 approved the company's petition to reorganize and
appointed Miguel Kupchik to supervise the proceeding as trustee.
Creditors' proofs of claim were verified until Feb. 28, 2005.
Mr. Kupchik submitted the validated claims as individual reports
on April 13, 2005. A general report was also presented to court
on May 26, 2005.
Dr. Cadarma, clerk no. 26, assisted the court in this case.
The debtor can be reached at:
Norte Asistencia Empresaria S.A.
Avenida Independencia 799
Buenos Aires, Argentina
The trustee can be reached at:
Miguel Kupchik
Alsina 1360
Buenos Aires, Argentina
OPTIMUS SA: Court Approves Reorganization Petition
--------------------------------------------------
A court in Rosario, Santa Fe, approved a petition for
reorganization filed by Optimus S.A., according to a report from
Argentine daily Infobae.
A court-appointed trustee, whose name is not yet disclosed, will
verify claims from the company's creditors. After a
verification period, the trustee will submit the individual and
general reports in court. Dates for submission of these reports
and the verification period are yet to be disclosed.
Creditors will then vote to ratify the completed settlement plan
during an informative assembly.
Infobae did not reveal in its Web site the deadline for the
submission of claims and the schedule for the informative
assembly.
The debtor can be reached at:
Optimus S.A.
Paraguay 975 Rosario
Santa Fe, Argentina
SAN JORGE: Asks Court's Approval to Reorganize Business
-------------------------------------------------------
Buenos Aires' Court No. 1 is reviewing the merits of San Jorge
Mayorista S.A.'s petition to reorganize. La Nacion states that
the Company filed the petition following cessation of debt
payments on May 9, 2006. Reorganization will allow San Jorge to
avoid bankruptcy by negotiating a settlement with its creditors.
Clerk No. 2 assists the court in this proceeding.
The debtor can be reached at:
San Jorge Mayorista S.A.
Maipu 26
Buenos Aires, Argentina
SARACCO Y TEJEDO: Court Appoints Cerchio Botta as Bank. Trustee
---------------------------------------------------------------
A court based in Rosario, Santa Fe, appointed accounting firm
Cerchio, Botta, Termini, as trustee for the bankruptcy case of
local company Saracco y Tejedo S.R.L., relates Infobae.
As reported in the Troubled Company Reporter on May 16, 2006,
the reorganization of Saracco y Tejedo has progressed into
bankruptcy after the court ruled that the company is bankrupt.
The company's assets will be liquidated at the end of the
bankruptcy process to repay creditors.
The debtor can be reached at:
Saracco y Tejedo S.R.L
San Juan 1031, Rosario
Santa Fe, Argentina
The trustee can be reached at:
Cerchio, Botta, Termini
Mendoza 3887
Santa Fe, Argentina
SAVIO MATERIALES: Proofs of Claim Filing Deadline on June 20
------------------------------------------------------------
Buenos Aires' Court No. 18 extended the verification of
creditors' proofs of claim against bankrupt firm Savio
Materiales S.A. until June 20, 2006, from March 31, 2006.
Manuel Arnaldo, the court-appointed trustee, will validate the
claims.
As reported in the Troubled Company Reporter on Jan. 6, 2006,
Savio Materiales, which commercializes construction materials,
entered bankruptcy after the court approved a bankruptcy motion
filed by Aridos de Campana S.A.
The company's assets will be liquidated at the end of the
bankruptcy process to repay creditors. Payments will be based
on the results of the verification process.
Clerk No. 35 assists the court in this case.
The debtor can be reached at:
Savio Materiales S.R.L.
Ricardo Levene 956
Buenos Aires
The trustee can be reached at:
Manuel Arnaldo
Parana 224
Buenos Aires
TERCER MILENIO: Individual Reports Due in Court on June 30
----------------------------------------------------------
Court-appointed trustee Ruben Angel Scaletta stopped verifying
claims from Tercer Milenio Editores S.A.'s creditors on
May 18, 2006. Infobae relates that verified claims will be used
as basis in creating individual reports, which will be due in
court on June 30, 2006.
A general report is expected in court on Aug. 25, 2006.
Court No. 17 of Buenos Aires' civil and commercial tribunal
declared the local company bankrupt at the behest of Mr. Pablo
Marchetti, whom the company owes US$34,553.67.
The company's assets will be liquidated at the end of the
bankruptcy process to repay creditors.
Clerk No. 34 assists the court on the case.
The trustee can be reached at:
Ruben Angel Scaletta
Piedras 1077
Buenos Aires, Argentina
=============
B A H A M A S
=============
WINN-DIXIE: Trade Panel Wants to Examine Sr. Notes' Underwriters
----------------------------------------------------------------
Pursuant Rule 2004 of the Federal Rules of Bankruptcy Procedure,
the Ad Hoc Trade Committee asks the U.S. Bankruptcy Court for
the Middle District of Florida for authority to conduct
examinations on parties who are underwriters of the 8.875%
Senior Notes. The Trade Committee seeks to determine what
information the Examinees relied upon in underwriting the Note
Issuance, Mr. Friedman explains.
The Trade Committee also asks the Court to compel the production
of documents within the Examinees' possession or otherwise
obtainable by them.
Winn-Dixie Stores, Inc., and its debtor-affiliates are parties
to an indenture with First Union National Bank as trustee dated
Dec. 26, 2000. Pursuant to the Indenture, the Debtors issued
US$300,000,000 in principal amount of senior notes bearing
interest at 8.875% per annum.
Mark J. Friedman, Esq., at DLA Piper Rudnick Gray Cary US LLP,
in Baltimore, Maryland, relates that the Debtors have begun
negotiations with creditor groups regarding the framework for a
plan of reorganization.
Mr. Friedman asserts that based on documents that are publicly
available and documents the Debtors have produced, the Debtors'
Chapter 11 cases should be substantively consolidated. Thus, no
plan of reorganization should be filed without substantive
consolidation of the Debtors.
Mr. Friedman notes that one subject that will be very relevant
to a substantive consolidation analysis will be the facts
surrounding the issuance of the 8.875% Senior Notes.
Headquartered in Jacksonville, Florida, Winn-Dixie Stores, Inc.
-- http://www.winn-dixie.com/-- is one of the nation's largest
food retailers. The Company operates stores across the
Southeastern United States and in the Bahamas and employs
approximately 90,000 people. The Company, along with 23 of its
U.S. subsidiaries, filed for chapter 11 protection on Feb. 21,
2005 (Bankr. S.D.N.Y. Case No. 05-11063, transferred Apr. 14,
2005, to Bankr. M.D. Fla. Case Nos. 05-03817 through 05-03840).
D.J. Baker, Esq., at Skadden Arps Slate Meagher & Flom LLP, and
Sarah Robinson Borders, Esq., and Brian C. Walsh, Esq., at King
& Spalding LLP, represent the Debtors in their restructuring
efforts. Paul P. Huffard at The Blackstone Group, LP, gives
financial advisory services to the Debtors. Dennis F. Dunne,
Esq., at Milbank, Tweed, Hadley & McCloy, LLP, and John B.
Macdonald, Esq., at Akerman Senterfitt give legal advice to the
Official Committee of Unsecured Creditors. Houlihan Lokey &
Zukin Capital gives financial advisory services to the
Committee. When the Debtors filed for protection from their
creditors, they listed US$2,235,557,000 in total assets and
US$1,870,785,000 in total debts. (Winn-Dixie Bankruptcy News,
Issue No. 38; Bankruptcy Creditors' Service, Inc., 215/945-
7000).
WINN-DIXIE: Trade Panel Wants Debtors' Substantial Consolidation
----------------------------------------------------------------
The Ad Hoc Trade Committee asks the U.S. Bankruptcy Court for
the Middle District of Florida to substantively consolidate
Winn-Dixie Stores, Inc., and its debtor-affiliates' estates
pursuant to Section 105(a) of the Bankruptcy Code.
The Trade Committee was reformed and reactivated in March 2006
to investigate substantive consolidation issues from the
perspective of the Debtors' trade creditors.
The current members of the Trade Committee are:
-- ASM Capital,
-- Amroc Investments, LLC,
-- Avenue Capital Group,
-- LCH Opportunities, LLC,
-- DellaCamera Capital Management, LLC,
-- Contrarian Capital Management, LLC,
-- Longacre Fund Management, LLC,
-- ConAgra Foods, Inc.,
-- The Procter & Gamble Distributing Co.,
-- S.C. Johnson & Son, Inc.,
-- Conopco, Inc.,
-- Madison Capital Management,
-- VR Capital Group, Ltd., and
-- General Mills, Inc.
The Trade Committee members hold approximately US$70,000,000 in
unsecured claims, relating to goods, sold and delivered to the
Debtors, services rendered to the Debtors, and rejection of
leases.
Thomas R. Califano, Esq., at DLA Piper Rudnick Gray Cary US LLP,
in New York, tells the Court that the Trade Committee informally
asked the Debtors to provide documentation relating to their
business, which are relevant to a substantive consolidation
analysis. On March 30, 2006, the Debtors and the Trade
Committee entered into a confidentiality agreement to facilitate
the Trade Committee's investigation.
According to Mr. Califano, the Debtors would not have produced
documents to the Trade Committee absent the Trade Committee
entering into the Confidentiality Agreement.
Mr. Califano asserts that substantive consolidation is
appropriate because:
(a) there is a substantial identity between the Debtors; and
(b) consolidation is necessary to avoid some harm or realize
some benefit.
The Trade Committee seeks the Court's permission file under seal
its brief supporting its substantive consolidation motion and
the affidavit of M. Freddie Reiss.
Mr. Califano explains that the Brief and the Reiss Affidavit are
in part based on non-public, confidential and proprietary
information about the Debtors that has been voluntarily
disclosed to the Trade Committee by the Debtors, but are subject
to the Confidentiality Agreement.
Headquartered in Jacksonville, Florida, Winn-Dixie Stores, Inc.
-- http://www.winn-dixie.com/-- is one of the nation's largest
food retailers. The Company operates stores across the
Southeastern United States and in the Bahamas and employs
approximately 90,000 people. The Company, along with 23 of its
U.S. subsidiaries, filed for chapter 11 protection on Feb. 21,
2005 (Bankr. S.D.N.Y. Case No. 05-11063, transferred Apr. 14,
2005, to Bankr. M.D. Fla. Case Nos. 05-03817 through 05-03840).
D.J. Baker, Esq., at Skadden Arps Slate Meagher & Flom LLP, and
Sarah Robinson Borders, Esq., and Brian C. Walsh, Esq., at King
& Spalding LLP, represent the Debtors in their restructuring
efforts. Paul P. Huffard at The Blackstone Group, LP, gives
financial advisory services to the Debtors. Dennis F. Dunne,
Esq., at Milbank, Tweed, Hadley & McCloy, LLP, and John B.
Macdonald, Esq., at Akerman Senterfitt give legal advice to the
Official Committee of Unsecured Creditors. Houlihan Lokey &
Zukin Capital gives financial advisory services to the
Committee. When the Debtors filed for protection from their
creditors, they listed US$2,235,557,000 in total assets and
US$1,870,785,000 in total debts. (Winn-Dixie Bankruptcy News,
Issue No. 38; Bankruptcy Creditors' Service, Inc., 215/945-
7000).
WINN-DIXIE: US Bankruptcy Court Okays Sale of 12 Supermarkets
-------------------------------------------------------------
Winn-Dixie Stores, Inc., reported that the U.S. Bankruptcy Court
for the Middle District of Florida has given its approval in
connection with the sale of 12 supermarkets in the Bahamas --
nine operated by Winn-Dixie under the City Markets banner and
three under the Winn-Dixie banner.
The stores are to be sold to BSL Holdings Limited, a Bahamian
investor group represented by Fidelity Merchant Bank & Trust
Limited, for approximately US$54 million. All 12 stores are
expected to remain open following completion of the transaction.
Pursuant to a definitive agreement with BSL Holdings Limited, W-
D (Bahamas) Ltd., a wholly owned Bahamas subsidiary of Winn-
Dixie, has agreed to sell all of its shares of Bahamas
Supermarkets Limited aka BSL to BSL Holdings Limited. W-D
(Bahamas) owns approximately 78% of the common shares of BSL.
The remainder of BSL's common shares will remain publicly traded
in the Bahamas. The sale agreement is subject to conditions,
including regulatory approval in the Bahamas.
The stores were sold at auction on May 16, 2006, to the higher
bid of two competing groups -- BK Foods, Ltd., and BSL Holdings
Limited. BSL Holdings Limited had the winning bid of US$54
million.
Upon completion of this transaction, Winn-Dixie will operate 538
stores in Florida, Alabama, Louisiana, Georgia, and Mississippi
-- including 10 that are temporarily closed as a result of
Hurricane Katrina.
A list of the stores is available at http://www.winn-dixie.com.
About Winn-Dixie
Headquartered in Jacksonville, Florida, Winn-Dixie Stores, Inc.
-- http://www.winn-dixie.com/-- is one of the nation's largest
food retailers. The Company operates stores across the
Southeastern United States and in the Bahamas and employs
approximately 90,000 people. The Company, along with 23 of its
U.S. subsidiaries, filed for chapter 11 protection on Feb. 21,
2005 (Bankr. S.D.N.Y. Case No. 05-11063, transferred Apr. 14,
2005, to Bankr. M.D. Fla. Case Nos. 05-03817 through 05-03840).
D.J. Baker, Esq., at Skadden Arps Slate Meagher & Flom LLP, and
Sarah Robinson Borders, Esq., and Brian C. Walsh, Esq., at King
& Spalding LLP, represent the Debtors in their restructuring
efforts. Paul P. Huffard at The Blackstone Group, LP, gives
financial advisory services to the Debtors. Dennis F. Dunne,
Esq., at Milbank, Tweed, Hadley & McCloy, LLP, and John B.
Macdonald, Esq., at Akerman Senterfitt give legal advice to the
Official Committee of Unsecured Creditors. Houlihan Lokey &
Zukin Capital gives financial advisory services to the
Committee. When the Debtors filed for protection from their
creditors, they listed US$2,235,557,000 in total assets and
US$1,870,785,000 in total debts.
===========
B E L I Z E
===========
PETROLEOS DE VENEZUELA: Proposes Oil Alliance with Belize
---------------------------------------------------------
Petroleos de Venezuela SA proposes a strategic alliance with
Belize to help the nation explore its emerging oil market.
Belize has recently found oil deposits in its territory.
PDVSA has proposed to export crude oil to Belize and help the
nation develop its infrastructure for its new oil industry, El
Universal relates.
Also, the Venezuelan government will lend US$25 million to
Belize to help it finance its emerging oil market, El Universal
reports.
According to Belize Planning and Budge Management minister Ralph
Fonseca, the loan will help his country improve its balance of
payments before commencing an alliance with PDVSA, El Universal
relates.
"We have just arrived in the oil business, but Venezuela has a
valuable expertise we could use," Mr. Fonseca told El Universal.
About PDVSA
Petroleos de Venezuela SA aka PDVSA is Venezuela's state oil
company in charge of the development of the petroleum,
petrochemical and coal industry, as well as planning,
coordinating, supervising and controlling the operational
activities of its divisions, both in Venezuela and abroad.
* * *
On Jan. 23, 2005, Fitch Ratings upgraded the local and foreign
currency ratings of Petroleos de Venezuela S.A. aka PDVSA to
'BB-' from 'B+'. The rating of PDVSA's export receivable
future flow securitization, PDVSA Finance Ltd, was also upgraded
to 'BB+' from 'BB'. In addition, Fitch has assigned PDVSA a
'AAA(ven)' national scale rating. The Rating Outlook is
Stable. Both rating actions follow Fitch's November 2005
upgrade of Venezuela's sovereign rating.
About Belize
Belize lies on the eastern or Caribbean coast of Central
America, bounded on the north and part of the west by Mexico,
and on the south and the remainder of the west by Guatemala. The
Country's natural resources include arable land potential,
timber, fish, andhydropower.
Moody's Investor Service assigned these ratings to Belize:
-- CC LT Foreign Bank Depst Caa3
-- CC LT Foreign Curr Debt Caa3
-- CC ST Foreign Bank Depst NP
-- CC ST Foreign Curr Debt NP
-- LC Curr Issuer Rating Caa3
-- FC Curr Issuer Rating Caa3
-- Foreign Currency LT Debt Caa3
-- Local Currency LT Debt Caa3
Standard & Poor's Rating Service assigned these ratings to
Belize:
-- Foreign Currency LT Debt CCC-
-- Local Currency LT Debt CCC+
-- Foreign Currency ST Debt C
-- Local Currency ST Debt C
=============
B E R M U D A
=============
FOSTER WHEELER: Names Raymond Milchovich as New Global Group CEO
----------------------------------------------------------------
Foster Wheeler Ltd. has appointed Raymond J. Milchovich as
company chairman, president and chief executive officer
effective June 16, 2006.
Bernard H. "Bud" Cherry's term as Foster Wheeler's chief
executive officer of its Global Power Group, will end effective
June 16.
Mr. Cherry joined Foster Wheeler in November 2002 as president
and chief executive officer of Foster Wheeler North America
Corp. In May 2004, Foster Wheeler consolidated the management
of its North American and European power businesses into one
global business, Foster Wheeler Global Power Group, under Mr.
Cherry's leadership as chief executive officer.
"I would like to thank Bud for his energy, commitment and
contribution to Foster Wheeler," said Mr. Milchovich. "He
strengthened the operational and financial performance of our
North American operations and led the successful consolidation
of our worldwide power businesses into one business group.
Under his leadership, the Global Power Group also secured a
double world-first in the strategically important circulating
fluidized-bed boiler market, with the award of the new 460
megawatt plant at Lagisza in Poland, the world's largest CFB
boiler and the world's first supercr0itical CFB unit. As the
markets served by our Global Power Group continue to strengthen,
one of my top priorities going forward is to realize the full
potential of our global power business."
Headquaretered in Hamilton, Bermuda, Foster Wheeler Ltd.
-- http://www.fwc.com/-- is a global company offering, through
its subsidiaries, a broad range of engineering, procurement,
construction, manufacturing, project development and management,
research and plant operation services. Foster Wheeler serves
the refining, upstream oil and gas, LNG and gas-to-liquids,
petrochemical, chemicals, power, pharmaceuticals, biotechnology
and healthcare industries.
At Dec. 31, 2005, Foster Wheeler's balance sheet showed a
US$341,796,000 equity deficit compared to a US$525,565 equity
deficit on Dec. 31, 2004.
* * *
On Feb. 7, 2006, Standard & Poor's Ratings Services revised its
outlook on Foster Wheeler Ltd. to stable from negative. At the
same time, Standard & Poor's affirmed its 'B-' corporate credit
rating and 'CCC+' senior secured debt rating on the Clinton, New
Jersey-based engineering and construction company.
INTELSAT LTD: Appoints Senior Management Members to Finance Team
----------------------------------------------------------------
Jeff Freimark, the Chief Financial Officer and Executive Vice
President Finance and Information Technology at Intelsat Ltd.,
appointed members of senior management to Intelsat's finance
organization.
Anita Beier will be the senior vice president and controller in
the finance team, reporting to Mr. Freimark. Her
responsibilities and areas of oversight at Intelsat will
include:
-- revenue control,
-- accounting operations,
-- financial reporting,
-- financial information systems and
-- payroll.
Ms. Beier previously worked for US Airways, where she held the
position of Senior Vice President and Controller, responsible
for all accounting functions. Before US Airways, Ms. Beier held
various management level positions at CSX Corporation and
American Commercial Lines.
Tim Carnahan, formerly with Shop Rite Supermarkets, Inc. has
been appointed to the position of Vice President, Financial
Operations. Mr. Carnahan will play an integral role in
tightening processes and procedures with an eye toward improving
efficiencies and effectuating integration requirements. He will
oversee:
-- procurement,
-- financial processes and
-- financial integration.
Prior to his work at Shop Rite, Mr. Carnahan served in a number
of management positions at Grand Union Company and Office Depot.
On May 18, the two new appointees joined the rest of the
previously announced finance team, including:
-- Linda Kokal, Vice President and Treasurer;
-- Dianne VanBeber, Vice President Investor Relations and
Corporate Communications;
-- Tim Kraus, Vice President, Corporate Tax; and
-- Adam Levy, Vice President, Information Systems.
"We're very excited to have both Anita and Tim on board," said
Jeff Freimark, the Chief Financial Officer of Intelsat. "The
wealth of experience they bring to the table will play a
significant role in strengthening Intelsat's financial controls
and processes and we look forward to having them on the team."
Noah Asher, Intelsat's Senior Vice President of Finance, will
retain his position through the end of the year, during which he
will continue to oversee the budgets and financial planning
functions in order to assist with the PanAmSat acquisition
financing and to ensure a smooth transition.
* * *
As reported in the Troubled Company Reporter on April 28, 2006,
Fitch currently has Intelsat and its subsidiaries' debt on
Rating Watch Negative, and rated its debt as follows:
Intelsat, Ltd.
-- Issuer default rating: B-
-- Senior unsecured notes: CCC/RR6
Intelsat (Bermuda), Ltd.
-- Senior unsecured discount notes: B-/RR4
Intelsat Subsidiary Holding Company Ltd.
-- Senior secured credit facilities: BB-/RR1
-- Senior unsecured notes: B+/RR2
=============
B O L I V I A
=============
* BOLIVIA: Refuses Gas Pipeline Project with Petroleo Brasileiro
----------------------------------------------------------------
The government of Bolivia has refused to build a US$20 billion
gas pipeline with Brazil's Petroleo Brasileiro SA aka Petrobras,
Agence France-Presse reports.
"As long as Petrobras has large multinationals as majority
shareholders, I understand that the government of Evo Morales
will not authorize participation in the pipeline," Andres Soliz,
the mining minister of Bolivia, told AFP.
According to AFP, Bolivia wants to exclusively work with other
state-run energy firms in constructing the pipeline.
Celso Amorim, the foreign minister of Brazil, was quoted by AFP
as saying that if Petrobras does not participate in the Southern
Gas Pipeline, there will be no pipeline.
The Brazilian minister informed AFP that for the pipeline to
reach Argentina, it would have to go so far out of the way that
it could be called the Western Gas Pipeline.
AFP recalls that Bolivia's President Evo Morales recently seized
foreign gas and oil installations, telling the firms that he
would not nationalize their investments and giving them 180 days
to negotiate new pacts with Bolivia's state energy firm, YPFB.
According to AFP, President Morales' decision was applauded by
Venezuela's President Hugo Chavez, who immediately sought to
build a pipeline with Bolivia.
Mr. Soliz, however, opposes investing US$20 billion in the
pipeline if the profits go overseas, AFP relates.
Mr. Soliz revealed to AFP that foreigners hold 60% of Petrobras.
"Are we going to invest enormous amounts of money so that the
multinationals, in business with Petrobras, benefit?" he said.
The Brazilian government informed AFP that Petrobras is owned:
-- 33% by the state, corresponding to 56% of voting shares,
-- 7.6% by the national development bank aka BNDES,
-- 2.6% by an employees' fund, and
-- the other 57% are distributed among shareholders in
Brazil and, through American Depository Receipts aka ADM,
to shareholders outside Brazil.
Headquartered in Rio de Janeiro, Brazil, Petroleo Brasileiro
S.A. aka Petrobras was founded in 1953. The company explores,
produces, refines, transports, markets, distributes oil and
natural gas and power to various wholesale customers and retail
distributors in the country.
* * *
Petroleo Brasileiro SA's long-term corporate family rating is
rated Ba3 by Moody's and its foreign currency long-term debt is
rated BB- by Fitch.
* * *
As reported in the Troubled Company Reporter on April 26, 2006,
in conjunction with the roll out of Issuer Default Ratings and
Recovery Ratings for Latin America Corporates, Fitch Ratings has
taken rating actions on Petroleo de Brasileiro SA. These
ratings were affected:
Foreign Currency:
-- Previous Rating: 'BB-'
-- New RR: 'BB', Rating Outlook Positive
US$2.5 billion, Senior Unsecured Notes due 2008, 2013, 2014
and 2018:
-- Previous Rating: 'BB-'
-- New IDR: 'BB+'
* * *
Fitch Ratings assigned these ratings on Bolivia:
Rating Rating Date
------ -----------
Country Ceiling B- Jun. 17, 2004
Long Term IDR B- Dec. 14, 2005
Local Currency
Long Term Issuer
Default Rating B- Dec. 14, 2005
* BOLIVIA: Will Participate in Trade Fair with Cuba & Venezuela
---------------------------------------------------------------
Bolivia, along with Cuba and Venezuela, will participate in the
International Fair of the southern trade bloc, Bolivarian
Alternative for the Americas aka ALBA, and the People's Trade
Agreement aka TCP, Digital Gramma Internacional reports.
According to Digital Gramma, the fair is framed in the
integration accords covered by the ALBA and the TCP and signed
on April 28, 2006, in Havana by presidents:
-- Evo Morales of Bolivia,
-- Fidel Castro of Cuba, and
-- Hugo Chavez of Venezuela.
The fair will be held from May 25 to May 26 in La Paz, Bolivia,
Digital Gramma relates.
Bolivia's Ministry of Production and Small Businesses is
organizing the event, according to Digital Gramma. The ministry
said that it would serve for the exchange of information on
supply and demand possibilities in Bolivia, Cuba and Venezuela,
as well as in the potentiality of productive sectors.
Prensa Latina states that about 25 firms from Bolivia are
expected to participate. The number of participants from Cuba
and Venezuela is yet undetermined, according to Gustavo Barbery
-- Bolivia's deputy minister of trade and exports.
* * *
Moody's assigned these ratings on Cuba:
-- CC LT Foreign Bank Depst, Caa2
-- CC LT Foreign Curr Debt, Caa1
-- CC ST Foreign Bank Depst, NP
-- CC ST Foreign Curr Debt, NP
-- Issuer Rating, Caa1
* * *
Fitch Ratings assigned these ratings on Bolivia:
Rating Rating Date
------ -----------
Country Ceiling B- Jun. 17, 2004
Long Term IDR B- Dec. 14, 2005
Local Currency
Long Term Issuer
Default Rating B- Dec. 14, 2005
* * *
Venezuela's foreign currency long-term debt is rated B2 by
Moody's, B+ by Standard & Poor's, and BB- by Fitch.
===========
B R A Z I L
===========
BANCO ITAU: S&P Raises LT Counterparty Credit Rating to BB+
-----------------------------------------------------------
Standard & Poor's Ratings Services raised its long-term
counterparty credit rating on Banco Itau S.A. to 'BB+' from
'BB'. The outlook is stable.
"The upgrade to 'BB+'-one notch above the sovereign foreign
currency rating-reflects our views on improving economic and
industry risks for the banking sector in Brazil," said Standard
& Poor's credit analyst Tamara Berenholc.
Standard & Poor's believes the greatest risk of potential
government intervention detrimental to Itau's creditors to be a
deposit freeze, as opposed to currency controls. We estimate
the potential probability of a deposit freeze to be at the BB+
level, the same as the local currency rating of Brazil, and
consequently encompass this risk in the counterparty credit
rating on Itau.
While Itau is exposed to Brazilian country risk, we believe that
it potentially could survive the likely economic chaos of a
sovereign stress scenario due to stability of its deposits base
proved in recent crisis with the benefits from:
-- a strong retail franchise;
-- strong business and financial diversification that makes
Itau one of the strongest banks in Latin America;
-- superior liquidity;
-- relatively low exposure to foreign currency in assets and
liabilities; and
-- very strong financial performance with top efficiency and
cross-selling indicators.
Standard & Poor's see the economic and industry environment for
Brazilian banks more favorably, given:
-- improvements in the structure of the banking
industry, including the further consolidation of the
banking system with the strengthening of the largest
institutions;
-- banks' better profitability levels and revenues mix,;
-- the Brazilian Central Bank's commitment to improve the
quality and transparency of banking supervision; and
-- signs of greater banking penetration.
Under this environment, we expect Itau to maintain sustainable
profitability and solid diversification, and benefit from a
better environment for credit risk.
The rating on Itau incorporates the fact that it operates in
Brazil and is exposed to the economic and industry risk of the
country, including weaker asset quality indicators when compared
to those of its Latin American peers, as well as direct exposure
to sovereign risk through its local marketable securities and
open market operations. These negatives are partially mitigated
by Itau's
-- strong and diversified franchise;
-- strong profitability as compared to that of major peers;
-- position as a regional benchmark in fee income generation
and efficiency; and
-- its strong liquidity, reinforced by its increasing deposit
base.
Like most Brazilian retail banks, Itau's operations are mainly
in local currency, thus reducing the bank's exposure to a
foreign currency crisis.
Excluding Itau Europa operations that are not directly linked to
Brazil risk, foreign currency assets and liabilities represented
13% of the total in December 2005, mainly related to its
branches in:
-- New York,
-- Cayman,
-- Tokyo,
-- Nassau,
-- Cayman Islands, and
-- Argentina.
During the hyperinflation years in the 1980s, Brazil did not go
through a dollarization process as did other countries in Latin
America, a singularity that can be explained by the existence of
a "domestic currency substitute" in the form of bank deposits,
which have to be held in local currency-dollar deposits are only
allowed in foreign branches/subsidiaries. In addition, as the
local currency has been the reference currency in Brazil, and
because of the strong volatility of the foreign currency, the
exposure of the system to international assets/liabilities is
rather small.
The stable outlook reflects our expectation that Itau will
maintain its strong and diversified business operation with
superior efficiency and cross selling ability that reinforces
its strong profitability levels. It also incorporates the
expectation that the bank will maintain its strong liquidity
with the benefits it has derived in terms of increasing its
deposit base. If the local currency rating on the sovereign is
raised, the ratings on the bank would be reviewed based on its
own merits. The upgrade would depend on an improvement in the
economic environment in Brazil, combined with strong asset
quality indicators in less-adverse economic conditions after a
strong credit expansion, and sustainable profitability with the
benefits from its strong efficiency and cross selling. On the
other hand, if the sovereign local currency rating deteriorates,
the ratings on Itau would follow in tandem. The ratings would
also be negatively affected by a worsening of Itau's liquidity
position with reduction of its deposit base, increased dollar
exposure, or currency mismatch -- exposing the bank to a higher
foreign currency risk, and a decline in asset quality
indicators.
COMPANHIA VALE: Chinese Rejects 19% Iron Ore Hike With Japanese
---------------------------------------------------------------
Companhia Vale do Rio Doce's 19% increase in iron ore prices
reached with Japanese steelmakers won't be adapted by Chinese
mills, Baosteel Group Corp. told Bloomberg News.
As widely reported, Italy's Ilva SpA and Japanese steelmakers
accepted a 19% hike in the steelmaking ingredient. ThyssenKrupp
AG, Germany's biggest mill, agreed to the same rise on May 15.
As customary in previous years, the 19% rate would have become
the benchmark for global prices.
Price increases in previous years were normally set after a
first deal was reached between an iron-ore producer and a
steelmaker.
However, Chinese steelmakers, which account for 43% of global
iron ore imports, are hoping for a better deal.
Baosteel, the lead negotiator for China's mills, has said last
year's 71.5% price gain hurt profits, Bloomberg relates.
"China shouldn't prolong the talks too long, otherwise it will
affect normal steel production and local prices," Sean Zheng,
who helps manage US$100 million at Beijing-based Dingtian Asset
Management, told Bloomberg. "A 15 to 19 percent increase for
China is my take on this."
"The Chinese cries are getting less weight given that the
Japanese and main European consumers have agreed," Rob Clifford,
an analyst at ABN Amro Australia Ltd., in Melbourne, told
Bloomberg. "I suspect the Chinese will take a similar price."
According to Bloomberg, Japanese steelmakers last year came
under criticism from Chinese rivals for agreeing to a price
increase, which set a global benchmark.
According to Bloomberg, Chinese steelmakers had wanted more say
in this year's talks to reflect their role as the world's
largest buyer of iron ore. China tripled imports in the past
five years, and overtook Japan as the single-largest buyer in
2003.
Headquartered in Rio de Janeiro, Brazil, Companhia Vale do Rio
Doce -- http://www.cvrd.com.br/-- engages primarily in mining
and logistics businesses. It engages in iron ore mining, pellet
production, manganese ore mining, and ferroalloy production, as
well as in the production of nonferrous minerals, such as
kaolin, potash, copper, and gold.
* * *
On Jan. 5, 2006, Fitch Ratings assigned a long-term foreign
currency rating of 'BB' to Vale Overseas Limited's proposed
US$300 million issuance due 2016. Vale Overseas is a wholly
owned subsidiary of Companhia Vale do Rio Doce, a large
diversified mining company located in Brazil. The notes are
unsecured obligations of Vale Overseas and are unconditionally
guaranteed by CVRD. The obligation to guarantee the notes
rank pari passu with all of CVRD's other unsecured and
unsubordinated debt obligations. Fitch expects the proceeds of
this issuance to be used for general corporate purposes and
primarily to pay down US$300 million of Vale Overseas' 9.0%
guaranteed notes due 2013.
Fitch also maintained these ratings for CVRD and CVRD Finance
Ltd., a wholly owned subsidiary of CVRD:
-- CVRD foreign currency rating: 'BB', Outlook Positive;
-- CVRD local currency rating: 'BBB' Outlook Stable;
-- CVRD national scale rating: 'AAA(bra)', Outlook Stable;
-- CVRD Finance Ltd.: series 2000-1 and series 2000-3:
'BBB';
-- CVRD Finance Ltd., series 2000-2 and series 2003-1: 'AAA'.
COSAN SA: Selling ADRs to Finance Business Expansion
----------------------------------------------------
Cosan SA Industria e Comercio, the world's biggest sugarcane
processor, intends to sell American depositary receipts in the
next 18 to 24 months to fund its acquisitions and expansion,
Bloomberg News reports.
Bloomberg relates that Cosan seeks to double its size in six
years and increase its market share to 20% as demand for sugar-
based ethanol fuel soars.
Cosan's sugar and ethanol production capacity has increased by
20 percent to 25 percent in the past few years, Bloomberg says.
The company plans to spend US$400 million on acquisitions in
coming years to boost production.
Last year, Cosan raised 770 million reals (US$356 million) in an
initial public offering. Also, the company sold US$450 million
of perpetual bonds in January to help fund buyouts and expansion
of plants. Credit Suisse Group and Morgan Stanley managed the
bond sale.
* * *
On Mar. 7, 2006, Standard & Poor's Ratings Services assigned a
'BB' foreign currency rating to Cosan S.A. Industria e Comercio.
The company was assigned a 'BB' corporate credit rating with a
stable outlook.
PETROLEO BRASILEIRO: Bolivia Refuses Gas Pipeline with Company
--------------------------------------------------------------
The government of Bolivia has refused to join in building a
US$20 billion gas pipeline with Brazil's Petroleo Brasileiro aka
Petrobras, Agence France-Presse reports.
"As long as Petrobras has large multinationals as majority
shareholders, I understand that the government of Evo Morales
will not authorize participation in the pipeline," Andres Soliz,
the mining minister of Bolivia, told AFP.
According to AFP, Bolivia wants to exclusively work with other
state-run energy firms in constructing the pipeline.
Celso Amorim, the foreign minister of Brazil, was quoted by AFP
as saying that if Petrobras does not participate in the Southern
Gas Pipeline, there will be no pipeline.
The Brazilian minister informed AFP that for the pipeline to
reach Argentina, it would have to go so far out of the way that
it could be called the Western Gas Pipeline.
AFP recalls that Bolivia's President Evo Morales recently seized
foreign gas and oil installations, telling the firms that he
would not nationalize their investments and giving them 180 days
to negotiate new pacts with Bolivia's state energy firm, YPFB.
According to AFP, President Morales' decision was applauded by
Venezuela's President Hugo Chavez, who immediately sought to
build a pipeline with Bolivia.
Mr. Soliz, however, opposes investing US$20 billion in the
pipeline if the profits go overseas, AFP relates.
Mr. Soliz revealed to AFP that foreigners hold 60% of Petrobras.
"Are we going to invest enormous amounts of money so that the
multinationals, in business with Petrobras, benefit?" he said.
The Brazilian government informed AFP that Petrobras is owned:
-- 33% by the state, corresponding to 56% of voting shares,
-- 7.6% by the national development bank aka BNDES,
-- 2.6% by an employees' fund, and
-- the other 57% are distributed among shareholders in
Brazil and, through American Depository Receipts aka ADM,
to shareholders outside Brazil.
Headquartered in Rio de Janeiro, Brazil, Petroleo Brasileiro
S.A. aka Petrobras was founded in 1953. The company explores,
produces, refines, transports, markets, distributes oil and
natural gas and power to various wholesale customers and retail
distributors in the country.
* * *
Petroleo Brasileiro SA's long-term corporate family rating is
rated Ba3 by Moody's and its foreign currency long-term debt is
rated BB- by Fitch.
* * *
As reported in the Troubled Company Reporter on April 26, 2006,
in conjunction with the roll out of Issuer Default Ratings and
Recovery Ratings for Latin America Corporates, Fitch Ratings has
taken rating actions on Petroleo de Brasileiro SA. These
ratings were affected:
Foreign Currency:
-- Previous Rating: 'BB-'
-- New RR: 'BB', Rating Outlook Positive
US$2.5 billion, Senior Unsecured Notes due 2008, 2013, 2014
and 2018:
-- Previous Rating: 'BB-'
-- New IDR: 'BB+'
* * *
Fitch Ratings assigned these ratings on Bolivia:
Rating Rating Date
------ -----------
Country Ceiling B- Jun. 17, 2004
Long Term IDR B- Dec. 14, 2005
Local Currency
Long Term Issuer
Default Rating B- Dec. 14, 2005
USINAS SIDERURGICAS: S&P Upgrades LT Credit Rating to BB+
---------------------------------------------------------
Standard & Poor's Ratings Services raised its long-term
corporate credit rating on Usinas Sider£rgicas de Minas Gerais
S.A. to 'BB+' from 'BB'. The ratings were removed from
CreditWatch with positive implications where they were placed on
Feb. 28, 2006. The outlook is stable.
"The rating action reflects the improving operating environment
in the company's home country of Brazil, which reduces the
relevance of the company's exposure to country risks, given its
concentration of sales, as a constraining rating factor,
combined with the expectations that Usiminas will preserve
adequate credit measures even considering its robust capital
expenditures program for the next four years of about $1.87
billion through 2010," said Standard & Poor's credit analyst
Reginaldo Takara. Although a significant portion of these
investments will be financed with debt, new capital expenditures
financing loans will be offset by the amortization of existing
debt, resulting in only marginal increase to the company's total
debt in the next several years, if any.
We expect Usiminas' financial ratios to be tighter during peak
investment years 2008 and 2009, but even assuming a declining
price curve for steel products by that time and sustaining
Usiminas' consolidated EBITDA margins at its historic low-end
(around 30%), we still expect cash flow protection measures to
remain at adequate levels for the rating category. The company
is still to secure credit facilities at tenor and cost
compatible with the payback of its capital expenditures program,
which could be more stressful if market conditions deteriorate
in the future. Given Usiminas' current low financial leverage,
however, we do not foresee that as a relevant challenge. The
ratings do not factor Usiminas' so-called "second wave" of
investments, which would include the construction of a new steel
mill.
The ratings on Usiminas reflect its exposure to:
-- the cyclical and volatile global steel sector;
-- some reliance on the equally volatile economic and
operating environment of its home market Brazil;
-- increasing competition within the Brazilian steel
industry; and
-- the risks associated with the company's significant
capital expenditures program in implementation, funding,
and performance.
These risks are tempered by Usiminas'
-- sound financial profile, with total debt levels and
liquidity currently very conservative;
-- a solid business profile, made evident by a very
competitive cost structure;
-- resilient operating profitability and robust free cash
generation through economic cycles; and
-- a favorable market position in the fairly concentrated
flat carbon steel sector in Brazil, in particular in the
higher-end, quality-products segments.
The ratings on Usiminas reflect the consolidated credit quality
of the so-called "Usiminas System," consisting of the combined
operating and financial profiles of Usiminas and its wholly
owned subsidiary, Cosipa, and their respective subsidiaries.
The Usiminas System comprises the largest flat-steel production
complex in Latin America, with a consolidated capacity for 9.5
million metric tons per year of crude steel and operations in
the states of Minas Gerais (Ipatinga) and Sao Paulo (Cubatao,
under Cosipa).
Usiminas' consolidated revenues and EBITDA amounted to US$1.36
billion and US$420 million, respectively, in the three months
ended Mar. 31, 2006, equivalent to 1.95 million tons shipped.
About 38% of its consolidated shipments in the period were
destined to export markets.
The ratings do not incorporate Usiminas' long-term "second wave"
of investments, which includes the construction of a greenfield
five-million tpy steel mill at an estimated total cost of $3
billion, potentially teaming up with a global partner to reduce
Usiminas' commitment to the project to about 50% of the
project's total cost, and to secure long-term demand for the
mill's slab output. In particular, key variables such as:
-- construction schedules,
-- funding structure,
-- ownership structure, and
-- long-term commercial contracts
have not been defined yet for this project. We believe,
however, that even if it decides to go ahead with this strategic
move, Usiminas would seek to sustain its current prudent debt
profile and sound liquidity to adequately address cyclical and
volatile characteristics typical of the steel industry.
The stable outlook reflects our expectation that programmed
capital expenditures and associated financing debt will not lead
the company's credit measures to deteriorate to levels not
consistent with the rating category, in Usiminas' case, FFO-to-
total debt higher than 30%, total debt-to-EBITDA below 2.0x, and
EBITDA interest coverage above 4.0x. Standard & Poor's believe
those ratios can be sustained even assuming steel prices at much
more conservative levels than current ones and cost adjustment
at a slower pace. A negative rating revision could be triggered
by Usiminas' consistent breaching of target ratios, as this
would likely indicate either deterioration on some of the
positive business fundamentals that sustain the ratings today or
departure from current prudent financial policies. A positive
revision is challenged by significant capital expenditures and
the expectation of marginal increase in debt leverage in the
years ahead, but could be predicated by material improvement in
the company's business profile, as to its competitive position
or diversification, provided that financial policies remain
sound.
VIACAO ITAPEMIRIM: Issues US$45 Million in Global Bonds
-------------------------------------------------------
Viacao Itapemirim, a bus company in Brazil, has made a US$45
million three-year global bond, Latinlawyer Online reports.
Latinlawyer states that due to high investor demand, the US$35
million offering that ended on Feb. 22, 2006, was extended by
two months. The company also added US$10 million on the
issuance.
According to Latinlawyer, the new offering was made on April 13,
2006.
Camilo Gerosa Gomes -- a member of Pinheiro Neto Advogados, who
advised Itapemirim -- told Latinlawyer, "This issue is very
similar to the first short-term debt program established by
Viacao Itapemirim in 2004."
Mr. Gomes explained to Latinlawyer that both issues are secured
by a collateral package composed of pledges on Itapemirim's 10
most profitable interstate bus route licenses, as well as on all
of the capital stock of a real estate holding company belonging
to the Itapemirim Group.
Viacao Itapemirim, the largest interstate bus firm in Brazil,
operates in 21 states.
* * *
As reported in the Troubled Company Reporter on Feb. 14, 2006,
Fitch Ratings has affirmed and simultaneously withdrawn the
'CCC' rating assigned to Viacao Itapemirim S.A.'s 12% senior
secured notes and removed the rating from Rating Watch Negative.
Fitch has withdrawn the rating consistent with its policies and
will no longer provide ratings or analytical coverage of this
issue.
The notes totaling US$25.3 million (approximately BRL60 million)
were issued in February and April 2004 and were paid on time and
in full on Feb. 10, 2006.
===========================
C A Y M A N I S L A N D S
===========================
AERCAP A BORDEAUX: Holds Last Shareholders Meeting on June 5
------------------------------------------------------------
Shareholders of Aercap A Bordeaux Limited, fka Debis Airfinance
A Bordeaux Limited, will gather on June 5, 2006, for a final
general meeting at the offices of:
HSBC Financial Services (Cayman) Limited,
2nd Floor, Strathvale House
90 North Church Street
Grand Cayman, Cayman Islands
Accounts on the company's liquidation process will be presented
during the meeting.
As reported in the Troubled Company Reporter on May 16, 2006,
Aercap A Bordeaux started liquidating assets on March 31, 2006.
Verification of creditors' claims against the company will end
on May 25, 2006.
The liquidator can be reached at:
Sean Brennan
c/o Maples and Calder, Attorneys-at-law
P.O. Box 309GT, Ugland House
South Church Street, George Town
Grand Cayman, Cayman Islands
ARIAU LTD: Sets May 31 Deadline for Proofs of Claim Filing
----------------------------------------------------------
Creditors of Ariau Ltd. are required to present proofs of their
claims to John Cullinane and Derrie Boggess, the company's
liquidators, by May 31, 2006, or be excluded from receiving any
distribution or payment that the company will make.
Creditors are required to send by May 31 their full names,
addresses, descriptions, the full particulars of their debts or
claims, and the names and addresses of their lawyers, if any, to
the liquidators.
Ariau Ltd. started liquidating assets on April 18, 2006.
The liquidators can be reached at:
John Cullinane
Derrie Boggess
c/o Walkers SPV Limited
P.O. Box 908, George Town
Grand Cayman, Cayman Islands
Tel: (345) 914-6305
CONCORD INVESTMENTS: Filing of Proofs of Claim Ends on June 1
-------------------------------------------------------------
Creditors of Concord Investments are required to submit their
proofs of claim to Royhaven Secretaries Limited, the company's
liquidators, by June 1, 2006, or be excluded from receiving any
distribution or payment that the company will make.
Creditors are required to send by June 1, 2006, their full
names, addresses, descriptions, the full particulars of their
debts or claims, and the names and addresses of their lawyers,
if any, to the liquidators.
The company began liquidating assets on April 11, 2006.
The liquidator can be reached at:
Royhaven Secretaries Limited
Attention: Colin Fitzgerald
P.O. Box 707, George Town
Grand Cayman, Cayman Islands
Telephone: (1) (345) 945-4777
Facsimile: (1) (345) 945-4799
CRESCENT MEDIA: Proofs of Claim Filing Deadline on June 1
---------------------------------------------------------
Creditors of Crescent Media Tech Middle East, which is being
voluntarily wound up, are required to present proofs of
claim by June 1, 2006, to Linburgh Martin and John Sutlic, the
company's liquidators.
Creditors are required to present proofs of claim personally or
through their solicitors at the time and place that the
liquidator specified. Failure to present claims would mean
exclusion from the benefit of any distribution that the company
will make.
Crescent Media began liquidating assets on April 18, 2006.
The liquidators can be reached at:
Linburgh Martin
John Sutlic
Attention: Neil Gray
Close Brothers (Cayman) Limited
Fourth Floor, Harbour Place
P.O. Box 1034, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-8455
Fax: (345) 949-8499
SISYPHOS: Verification of Proofs of Claim Ends on June 1
--------------------------------------------------------
Linburgh Martin and Jeff Arkley, liquidators of bankrupt company
Sisyphos, will stop verifying creditors' proofs of claim by
June 1, 2006.
Creditors are required to present proofs of claim personally or
through their solicitors at the time and place that the
liquidator specified. Failure to present claims would mean
exclusion from the benefit of any distribution that the company
will make.
Sisyphos started liquidating assets on April 12, 2006.
The liquidators can be reached at:
Linburgh Martin
Jeff Arkley
Attention: Neil Gray
Close Brothers (Cayman) Limited
Fourth Floor, Harbour Place
P.O. Box 1034, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-8455
Fax: (345) 949-8499
URIZEN ACQUISITIONS: Proofs of Claim Must be Filed by June 3
------------------------------------------------------------
Creditors of Urizen Acquisitions Limited, which is being
voluntarily wound up, are required to present proofs of claim by
June 3, 2006, to Cereita Lawrence and Scott Aitken, the
company's liquidators.
Creditors are required to present proofs of claim personally or
through their solicitors at the time and place that the
liquidators specified. Failure to present claims would mean
exclusion from the benefit of any distribution that the company
will make.
The company started liquidating assets on Aril 13, 2006.
The liquidators can be reached at:
Cereita Lawrence
Scott Aitken
P.O. Box 1109, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7755
Fax: (345) 949-7634
=========
C H I L E
=========
GLOBAL CROSSING: Annual Shareholders' Meeting Set for June 13
-------------------------------------------------------------
Global Crossing Limited will hold its Annual General Meeting of
Shareholders at 10:00 a.m., on June 13, 2006, at the Omni
Berkshire Place, 21 East 52nd Street, in New York City.
The Company's shareholders will meet to receive the report of
the Company's independent registered public accounting firm and
the financial statements for the year ended Dec. 31, 2005, and
to take these actions:
a) elect two members of the Board of Directors;
b) increase the authorized share capital of the Company from
55,000,000 common shares to 85,000,000 common shares; and
c) appoint Ernst & Young LLP as the independent registered
public accounting firm of Global Crossing for the year
ending Dec. 31, 2006 and to authorize the Audit Committee
to determine their remuneration.
Only common and preferred shareholders of record at the close of
business on April 18, 2006, are entitled to receive notice of
and to vote at the meeting.
A copy of the proxy statement for the 2006 annual shareholders'
meeting is available for free at:
http://researcharchives.com/t/s?96d
About Global Crossing
Headquartered in Florham Park, New Jersey, Global Crossing
Ltd. -- http://www.globalcrossing.com/-- provides
telecommunication solutions over the world's first integrated
global IP-based network, which reaches 27 countries and more
than 200 major cities around the globe including Bermuda,
Argentina, Brazil, Chile, Mexico, Panama, Peru and Venezuela.
Global Crossing serves many of the world's largest corporations,
providing a full range of managed data and voice products and
services. The company filed for chapter 11 protection on
Jan. 28, 2002 (Bankr. S.D.N.Y. Case No. 02-40188). When the
Debtors filed for protection from their creditors, they listed
US$25,511,000,000 in total assets and US$15,467,000,000 in total
debts. Global Crossing emerged from chapter 11 on Dec. 9, 2003.
As of Dec. 31, 2005, Global Crossing's balance sheet reflected a
US$173 million equity deficit compared to a US$51 million of
positive equity at Dec. 31, 2004.
===============
C O L O M B I A
===============
* COLOMBIA: Gas Supplies Cut Off Due to Damage in Pipeline
----------------------------------------------------------
Gas supplies in Colombia was cut off when a landslide caused by
heavy rains damaged a gas pipeline, Rafael Mateus, spokesman for
Gas Natural's distribution company, told Inside Costa Rica.
The spokesman informed Inside Costa Rica that the landslide
destroyed around 140 meters of the pipeline in Cundinamarca --
the department southeast of the capital, which supplies Bogota's
natural gas.
Inside Costa Rica states that although another similar pipeline
to the city was not damaged, about 800 industrial users and 40
filling stations which refill 36,000 gas supply vehicles were
still affected.
Mr. Mateus told Inside Costa Rica that technicians from gas
firms were working to restore the service.
* * *
On May 30, 2005, Fitch Ratings affirmed Colombia's ratings as:
-- Long-term foreign currency 'BB';
-- Country ceiling 'BB';
-- Local currency 'BBB-';
-- Short-term 'B'.
Fitch said the Rating Outlook is Stable.
===================
C O S T A R I C A
===================
* COSTA RICA: Minister Denies Rumors on Daylight Saving Time
------------------------------------------------------------
Costa Rica's environment and energy minister, Roberto Dobles,
denied rumors on the implementation of Daylight Saving Time aka
DST in the country, Inside Costa Rica reports.
According to Inside Costa Rica, Minister Dobles said that the
Costa Rican government will stay in time behind Nicaragua,
Honduras and Guatemala.
Daylight saving time aka DST is a system of adjusting the
official local time forward -- usually one hour -- from its
official standard time for the summer months, to provide a
better match between the hours of daylight and the active hours
of work and school.
Kyodo News states that governments often consider it as an
energy conservation measure as it allows more effective use of
sunlight in summer time. Because there is less darkness in the
waking day, there is less use of electric lights.
However, Minister Dobles told Inside Costa Rica that
implementing DST is not an assurance that the country can save
energy.
Rodrigo Arias, the Ministro de la Presidencia, was quoted by
Inside Costa Rica as saying that DST will not make Costa Ricans
change their habits to the new time. According to him, the
idiosyncrasy will cause confusion.
Inside Costa Rica relates that the country may not need it as
Minister Arias said that the country has an excess of water and
electrical generating plants.
* * *
Costa Rica is rated by Moody's:
-- CC LT Foreign Bank Depst Ba2
-- CC LT Foreign Curr Debt Ba1
-- CC ST Foreign Bank Depst NP
-- CC ST Foreign Curr Debt NP
-- Foreign Currency LT Debt Ba1
-- Local Currency LT Debt Ba1
Fitch assigned these ratings to Costa Rica:
-- Foreign currency long-term debt, BB
-- Local currency long-term debt, BB
-- Foreign currency short-term debt, B
Costa Rica carries these ratings from Standard & Poor's:
-- Foreign Currency LT Debt BB
-- Local Currency LT Debt BB+
-- Foreign Currency ST Debt B
-- Local Currency ST Debt B
* COSTA RICA: Wants Banana Exclusion from Trade Pact with Europe
----------------------------------------------------------------
The government of Costa Rica wants to exclude banana from the
free trade pact with the European Union, Fresh Plaza reports.
Fresh Plaza states that the Costa Rican would have requested the
European Commission to leave bananas out in the products being
considered in the trade agreement negotiations.
According to Fresh Plaza, this is because Costa Rica and EU have
been disagreeing on the exportation of the product.
The conflict should be resolved in the next World Trade
Organization round, which will be in June or July, Marco Vinicio
Ruiz, Costa Rican minister of Foreign Trade, told Fresh Plaza.
* * *
Costa Rica is rated by Moody's:
-- CC LT Foreign Bank Depst Ba2
-- CC LT Foreign Curr Debt Ba1
-- CC ST Foreign Bank Depst NP
-- CC ST Foreign Curr Debt NP
-- Foreign Currency LT Debt Ba1
-- Local Currency LT Debt Ba1
Fitch assigned these ratings to Costa Rica:
-- Foreign currency long-term debt, BB
-- Local currency long-term debt, BB
-- Foreign currency short-term debt, B
Costa Rica carries these ratings from Standard & Poor's:
-- Foreign Currency LT Debt BB
-- Local Currency LT Debt BB+
-- Foreign Currency ST Debt B
-- Local Currency ST Debt B
=======
C U B A
=======
* CUBA: Will Participate in Trade Fair with Venezuela & Bolivia
---------------------------------------------------------------
Cuba, along with Venezuela and Bolivia, will participate in the
International Fair of the southern trade bloc, Bolivarian
Alternative for the Americas aka ALBA, and the People's Trade
Agreement aka TCP, Digital Gramma Internacional reports.
According to Digital Gramma, the fair is framed in the
integration accords covered by the ALBA and the TCP and signed
on April 28, 2006, in Havana by presidents:
-- Evo Morales of Bolivia,
-- Fidel Castro of Cuba, and
-- Hugo Chavez of Venezuela.
The fair will be held from May 25 to May 26 in La Paz, Bolivia,
Digital Gramma relates.
Bolivia's Ministry of Production and Small Businesses is
organizing the event, according to Digital Gramma. The ministry
said that it would serve for the exchange of information on
supply and demand possibilities in Bolivia, Cuba and Venezuela,
as well as in the potentiality of productive sectors.
Prensa Latina states that about 25 firms from Bolivia are
expected to participate. The number of participants from Cuba
and Venezuela is yet undetermined, according to Gustavo Barbery
-- Bolivia's deputy minister of trade and exports.
* * *
Moody's assigned these ratings on Cuba:
-- CC LT Foreign Bank Depst, Caa2
-- CC LT Foreign Curr Debt, Caa1
-- CC ST Foreign Bank Depst, NP
-- CC ST Foreign Curr Debt, NP
-- Issuer Rating, Caa1
* * *
Fitch Ratings assigned these ratings on Bolivia:
Rating Rating Date
------ -----------
Country Ceiling B- Jun. 17, 2004
Long Term IDR B- Dec. 14, 2005
Local Currency
Long Term Issuer
Default Rating B- Dec. 14, 2005
* * *
Venezuela's foreign currency long-term debt is rated B2 by
Moody's, B+ by Standard & Poor's, and BB- by Fitch.
===================================
D O M I N I C A N R E P U B L I C
===================================
AES CORP: Acquires 25% Stake on 432-MW Power Plant for US$25M
-------------------------------------------------------------
The AES Corporation has restructured its investment in a 432-MW
power plant in the Dominican Republic by acquiring a 25%
interest in the facility from El Paso Corporation for
approximately U$25 million.
AES' acquisition was wholly financed with non-recourse debt.
Through this acquisition, AES and its subsidiary AES Gener hold
a combined 50% interest in the Itabo plant.
AES has held an interest in the Itabo plant since 2000 through
its AES Gener subsidiary.
About El Paso Corporation
El Paso Corporation provides natural gas and related energy
products. The company owns North America's largest natural gas
pipeline system and one of North America's largest independent
natural gas producers. For more information, visit
http://www.elpaso.com.
About AES Corporation
AES Corporation -- http://www.aes.com/-- is a global power
company. The Company operates in South America, Europe, Africa,
Asia and the Caribbean countries. Generating 44,000 megawatts
of electricity through 124 power facilities, the Company
delivers electricity through 15 distribution companies.
AES's Latin America business group is comprised of generation
plants and electric utilities in Argentina, Brazil, Chile,
Colombia, Dominican Republic, El Salvador, Panama and Venezuela.
Fuels include biomass, diesel, coal, gas and hydro. The group
also pursues business development activities in the region. AES
has been in the region since May 1993, when it acquired the CTSN
power plant in Argentina.
BANCO BHD: Fitch Upgrades LT Foreign Currency Rating to B
---------------------------------------------------------
Fitch has upgraded the foreign currency long-term Issuer Default
Rating of Banco BHD to 'B' from 'B-'. Fitch has also affirmed
Banco BHD and Republic Bank 's other international and national
ratings. These actions follow Fitch's recently announced
upgrade of the Dominican Republic's long-term foreign currency
IDR to 'B'.
The upgrade in the sovereign rating reflects the country's
comparably low external and public debt burdens, manageable debt
service profile, as well as a consolidation of the economic
recovery. Nevertheless, in spite of recent improvements, the
Dominican Republic's credit profile continues to be constrained
by low liquidity, a situation that can be exacerbated by a loss
of confidence and ensuing capital flights.
Despite the improved capacity of the sovereign to fulfill its
foreign currency obligations, the operating environment still
presents significant challenges for banks due to:
-- slow loan demand,
-- low interest rates,
-- weak asset quality ratios and
-- tight capitalization ratios, which require special
attention from the authorities and individual players.
Nevertheless, the rebound in economic activity, the initial
actions implemented towards the overhaul of the regulatory
environment, and recent capital injections could drive an
improvement of the aforementioned system weaknesses.
Banco BHD's ratings reflect its diversified retail deposit base,
significant market share, adequate liquidity, competent
management and robust shareholder structure. However, the
ratings also consider the bank's volatile asset quality and
profitability, as well as its thin capital levels within a
competitive operating environment. As of December 2005, Banco
BHD ranked third out of 12 commercial banks, with a 13% market
share by total assets. Grupo BHD, which controls 60% of Centro
Financiero BHD, the bank's holding company, is one of the
largest economic groups in the Dominican Republic. BHD enjoys
close cooperation with Banco Sabadell of Spain and Banco Popular
de Puerto Rico, which together control the remaining 40% of
Centro Financiero BHD.
Fitch has upgraded this rating:
-- Long-term foreign currency IDR to 'B' from 'B-'.
The Outlook is Stable.
Fitch also affirms these ratings:
-- Short-term foreign currency affirmed at 'B';
-- Long-term local currency IDR affirmed at 'B';
-- Short-term local currency affirmed at 'B';
-- Individual affirmed at 'D';
-- Support affirmed at '5';
-- Long-term national rating affirmed at 'A(dom)'; and
-- Short-term national rating affirmed at 'F1(dom)'.
REPUBLIC BANK: Fitch Upgrades LT Foreign Currency Rating to B
-------------------------------------------------------------
Fitch has upgraded the foreign currency long-term Issuer Default
Rating of Republic Bank (Dominican Republic) to 'B' from 'B-'.
Fitch has also affirmed the Republic Bank 's other international
and national ratings. These actions follow Fitch's recently
announced upgrade of the Dominican Republic's long-term foreign
currency IDR to 'B'.
The upgrade in the sovereign rating reflects the country's
comparably low external and public debt burdens, manageable debt
service profile, as well as a consolidation of the economic
recovery. Nevertheless, in spite of recent improvements, the
Dominican Republic's credit profile continues to be constrained
by low liquidity, a situation that can be exacerbated by a loss
of confidence and ensuing capital flights.
Despite the improved capacity of the sovereign to fulfill its
foreign currency obligations, the operating environment still
presents significant challenges for banks due to:
-- slow loan demand,
-- low interest rates,
-- weak asset quality ratios and
-- tight capitalization ratios, which require special
attention from the authorities and individual players.
Nevertheless, the rebound in economic activity, the initial
actions implemented towards the overhaul of the regulatory
environment, and recent capital injections could drive an
improvement of the aforementioned system weaknesses.
Republic Bank (DR)'s IDR ratings reflect, should it be required,
the potential support the bank would receive from its parent,
Republic Bank Limited. The individual rating also reflects the
constraints imposed by weak asset quality, accumulated losses
and the volatility of the operating environment. As of December
2005, Republic Bank (DR) ranked sixth out of 12 commercial
banks, with a 3% market share by total assets. In September
2003, RB acquired 99.8% of the shares of Republic Bank. RB is a
leading bank in Trinidad & Tobago but also has operations in:
-- Guyana,
-- Grenada,
-- Barbados,
-- St. Lucia, and
-- the Cayman Islands
and offers banking services throughout the Caribbean.
Fitch has upgraded this rating:
-- Long-term foreign currency IDR to 'B' from 'B-'.
The Outlook is Stable.
Fitch also affirms these ratings:
-- Short-term foreign currency affirmed at 'B';
-- Long-term local currency IDR affirmed at 'B';
-- Short-term local currency affirmed at 'B';
-- Individual affirmed at 'E';
-- Support affirmed at '4';
-- Long Term National Rating affirmed at 'A+(dom)'; and
-- Short Term National Rating affirmed at 'F1(dom)'.
* DOMINICAN REPUBLIC: Free Trade with US Takes Effect on July 1
---------------------------------------------------------------
The Free Trade Agreement with the Central America and the United
States involving the Dominican Republic aka DR-CAFTA will take
effect in the country on July 1, 2006, as prescheduled, Kevin
Manning -- president of the American Chamber of Commerce told
the Dominican Today.
Dominican Today relates that the Dominican entrepreneurs met
with representatives of the American Chamber met with
international business consultants and the US Agency for
International Development to discuss different aspects of the
DR-CAFTA. Among the issues addressed are:
-- the multilateral scope of the trade agreement and its
implications for the Dominican Republic,
-- precedents and results relative to market access, and
-- results for the country with respect to the agriculture
and industrial sectors.
According to Dominican Today, the two latter items were
considered by experts as the most sensitive and should get the
highest support from the government during the transaction
period in order for them to adapt to the new reality.
Dominican Today states that Mr. Manning believed that
difficulties surrounding the DR-CAFTA will be overcome.
Dominican technicians are expected to meet with technical
personnel from Washington's US Trade Office in the coming days,
Mr. Manning told Dominican Today.
* * *
The Troubled Company Reporter - Latin America reported on May 9,
2006, that Fitch Ratings upgraded these debt and issuer Default
Ratings of the Dominican Republic:
-- Long-term foreign currency Issuer Default Rating
to B from B-;
-- Country ceiling upgraded to B+ from B-;
-- Foreign currency bonds due 2006 to B-/RR4 from CCC+/RR4;
-- Foreign currency Brady bonds due 2009 to B/RR4
from B-/RR4;
-- Foreign currency bonds due 2011 to B/RR4 from B-/RR4;
-- Foreign currency bonds due 2013 to B-/RR4 from CCC+/RR4;
-- Foreign currency bonds due 2018 to B/RR4 from B-/RR4; and
-- Foreign currency collateralized Brady bonds due 2024
to B+/RR3 from B/RR3.
Fitch also affirmed these ratings:
-- Long-term local currency Issuer Default Rating: B; and
-- Short-term Issuer Default Rating: B.
Additionally, Fitch assigned a debt and Recovery Rating to this
issue:
-- Foreign currency bonds due 2027: B/RR4.
Fitch said the rating outlook for the long-term foreign and
local currency IDRs is Stable.
=============
E C U A D O R
=============
PETROECUADOR: Renews Contract with Repsol YPF
---------------------------------------------
Petroecuador, Ecuador's state-run oil company, informed
Petrolworld that it renewed its contract with Repsol YPF.
Petroecuador told Petrolworld that it will work with Repsol YPF
for another six years in the Tivacuno oil field in Ecuador's
Amazonian region.
Petroecuador informed Petrolworld that the contract, which was
first signed in 1996, would now run until 2012. Some terms,
however, had been changed to benefit Ecuador.
Repsol YPF, as agreed in the new contract, will invest US$30
million in new drilling to increase Tivacuno's output from 1,600
barrels per day (bpd) to 8,000 bpd of medium oil, Petrolworld
states. Repsol YPF will also give Ecuador 50% of the selling
price of the crude, pursuant to a new law passed by Ecuador in
April.
Petroecuador admitted to Petrolworld that renewed the contract
because it lacked the financial and technical resources to
achieve the extraction levels that Repsol YPF can provide.
Petroecuador also said that its poor financial condition would
make it unlikely to take over the Tivacuno field in 2012 when
the new operating contract expired, Petrolworld reports.
* * *
The Troubled Company Reporter - Latin America reported on
May 8, 2006, that Petroecuador's employees are threatening to
launch a strike if the government won't provide funding
necessary for the company's operations. Reports said that
Petroecuador has no funds for maintenance and no funds to repair
pumps in diesel, gasoline and natural gas refineries.
Ecuador's Economy Minister Diego Borja demanded more efficiency
from the state oil company as well as transparency in its
accounts.
Petroecuador has asked the government for US$279 million to pay
debts to suppliers, outsourcing firms and other creditors
threatening to halt services.
* * *
On June 20, 2005, Moody's Investors Service upgraded the ratings
of Spanish-Argentine oil company Repsol YPF's local subsidiary
YPF S.A. Moody's upgraded YPF's senior unsecured rating to Ba3
from B1 and the unit's domestic currency issuer rating to Baa2
from Baa3.
YPF's foreign currency issuer rating of Caa1 remained unchanged,
as it is constrained by the sovereign ceiling of Argentina.
YPF's Corporate Family Rating (formerly known as the senior
implied rating) is aligned with the foreign currency issuer
rating at Caa1.
REPSOL YPF: Renews Contract with Ecudorian State-Run Oil Firm
-------------------------------------------------------------
Repsol YPF's contract with Petroecuador, Ecuador's state-owned
oil firm, has been renewed, Petrolworld reports.
Petroecuador told Petrolworld that it will work with Repsol YPF
for another six years in the Tivacuno oil field in Ecuador's
Amazonian region.
Petroecuador informed Petrolworld that the contract, which was
first signed in 1996, would now run until 2012. Some terms,
however, had been changed to benefit Ecuador.
Repsol YPF, as agreed in the new contract, will invest US$30
million in new drilling to increase Tivacuno's output from 1,600
barrels per day (bpd) to 8,000 bpd of medium oil, Petrolworld
states. Repsol YPF will also give Ecuador 50% of the selling
price of the crude, pursuant to a new law passed by Ecuador in
April.
Petroecuador admitted to Petrolworld that renewed the contract
because it lacked the financial and technical resources to
achieve the extraction levels that Repsol YPF can provide.
Petroecuador also said that its poor financial condition would
make it unlikely to take over the Tivacuno field in 2012 when
the new operating contract expired, Petrolworld reports.
* * *
The Troubled Company Reporter - Latin America reported on
May 8, 2006, that Petroecuador's employees are threatening to
launch a strike if the government won't provide funding
necessary for the company's operations. Reports said that
Petroecuador has no funds for maintenance and no funds to repair
pumps in diesel, gasoline and natural gas refineries.
Ecuador's Economy Minister Diego Borja demanded more efficiency
from the state oil company as well as transparency in its
accounts.
Petroecuador has asked the government for US$279 million to pay
debts to suppliers, outsourcing firms and other creditors
threatening to halt services.
* * *
On June 20, 2005, Moody's Investors Service upgraded the ratings
of Spanish-Argentine oil company Repsol YPF's local subsidiary
YPF S.A. Moody's upgraded YPF's senior unsecured rating to Ba3
from B1 and the unit's domestic currency issuer rating to Baa2
from Baa3.
YPF's foreign currency issuer rating of Caa1 remained unchanged,
as it is constrained by the sovereign ceiling of Argentina.
YPF's Corporate Family Rating (formerly known as the senior
implied rating) is aligned with the foreign currency issuer
rating at Caa1.
=====================
E L S A L V A D O R
=====================
* EL SALVADOR: Ministry to Present Reform on Hydrocarbons Law
-------------------------------------------------------------
A reform on the hydrocarbons framework law from the economy
ministry is expected within 30 days, El Diario de Hoy reports.
According to El Diario, the reform will expand and strengthen
the ministry's hydrocarbons and mines department.
Minister Yolanda de Gavidia told El Diario that the changes will
provide the department with the resources to request updated
information on imports from oil companies that operate in El
Salvador.
"The establishment of more controls will contribute to
strengthening the market," Salvador Rivas -- executive director
of Asapetrol, El Salvador's oil industry association, told
Business News Americas.
BNamericas relates that Julio Villagran, administrative manager
of the oil products distributors association, agreed with Mr.
Rivas, adding that access to this type of data made Guatemala to
competitive in hydrocarbons sales.
However, Minister Gavidia was quoted by BNamericas as saying
that the changes will not mean that gas sale prices will be
regulated.
The local market price is not regulated and that the changes do
not oblige oil companies and gas stations to transfer increases
or decreases to consumers, Minister Gavidia told BNamericas.
* * *
Fitch Ratings assigned these ratings on El Salvador:
Rating Rating Date
------ -----------
Country Ceiling BB+ Jun. 18, 2004
Long Term IDR BB+ Dec. 14, 2005
Short Term IDR B Dec. 14, 2005
Local Currency
Long Term Issuer
Default Rating BB+ Dec. 14, 2005
=================
G U A T E M A L A
=================
* GUATEMALA: Venezuela Willing to Supply Discounted Crude
---------------------------------------------------------
Guatemalan mayors told Prensa Latina that Venezuela is willing
to supply cheap oil to the municipalities.
Prensa Latina recalls that the mayors visited Venezuela on
April 17 to seek aid in facing the energy crisis caused by the
increase in oil prices.
The Federation of United Municipalities of Guatemala, comprised
of 13 indigenous town councils, and the government of Venezuela
will sign an energy cooperation agreement in June, the mayors
disclosed during a press conference in Guatemala City.
Under the proposed deal, Guatemala will buy 450,000 barrels of
oil per month from Petroleos de Venezuela SA to be distributed
to the 13 towns. 60% of the fuel will be paid upfront, while
the rest will be paid in a 20-year period with an interest rate
of one percent, El Universal relates.
* * *
On Jan. 23, 2005, Fitch Ratings upgraded the local and foreign
currency ratings of Petroleos de Venezuela S.A. aka PDVSA to
'BB-' from 'B+'. The rating of PDVSA's export receivable
future flow securitization, PDVSA Finance Ltd, was also upgraded
to 'BB+' from 'BB'. In addition, Fitch has assigned PDVSA a
'AAA(ven)' national scale rating. The Rating Outlook is
Stable. Both rating actions follow Fitch's November 2005
upgrade of Venezuela's sovereign rating.
* * *
Fitch Ratings assigned these ratings on Guatemala:
Rating Rating Date
------ -----------
Country Ceiling BB+ Feb. 22, 2006
Long Term IDR BB+ Feb. 22, 2006
Short Term IDR B Feb. 22, 2006
Local Currency
Long Term Issuer
Default Rating BB+ Feb. 22, 2006
* * *
Fitch also rated Guatemala's senior unsecured bonds:
Maturity Date Amount Rate Ratings
------------- ------ ---- -------
Aug. 3, 2007 US$150,000,000 8.5% BB+
Nov. 8, 2011 US$325,000,000 10.25% BB+
Aug. 1, 2013 US$300,000,000 9.25% BB+
Oct. 6, 2034 US$330,000,000 8.125% BB+
===============
H O N D U R A S
===============
* HONDURAS: Union Members Protest Creation of New Telecoms Law
--------------------------------------------------------------
Union members at Hondutel, Honduras' state-run fixed line
operator, called for the lower house to abandon discussion on a
new telecoms law that will allow the sale of a minority stake in
the company, local daily El Tiempo reports.
Hugo Noe, the finance minister, recently announced plans to
create the bill, Business News Americas recalls.
BNamericas relates that the Sitratel union objected to the
clauses in the bill and demanded that the government should
reinstate Hondutel's monopoly for international long distance
that it lost in December 2005, along with its right to
exclusivity for basic fixed line, telex and public telephony
services.
The Honduran government had tried searching for a foreign
partner for the company in 2001, offering a 51% stake. Telmex
had offered US$106 million but the government found the bid too
low.
* * *
Moody's Investor Service assigned these ratings on Honduras:
Rating Rating Date
------ -----------
Senior Unsecured B2 Sept. 29, 1998
Long Term IDR B2 Sept. 29, 1998
=============
J A M A I C A
=============
AIR JAMAICA: Foreign Affairs Minister Proposes Merger with BWIA
---------------------------------------------------------------
Senator Anthony Hylton, the minister of foreign affairs and
foreign trade of Jamaica, proposed to merge Air Jamaica with
BWIA West Indies Airways Limited, the Jamaica Observer reports.
Minister Hylton told the gathering at the forum on international
trade issues held at the Fellowship Tabernacle on Half-Way-Tree
Road, "Speaking personally, I believe that the time has come for
us to look at a common transport arrangement, to look at the
possibility of a merger between Air Jamaica and BWIA."
According to the Observer, Minister Hylton asked the private
sector to look at this need for a transportation policy as an
opportunity for their participation, saying that the government
would welcome any initiative from them.
The minister, says the Observer, emphasized the importance of
both global and regional trade and outlined the negotiations the
government was involved in through his ministry.
For Jamaica to become a significant player in global trade, it
would have to embark on a radical transformation of its
productive capacity, Minister Hylton was quoted by the Observer
as saying.
Jamaica's state airline Air Jamaica and BWIA, which is run by
the government of Trinidad and Tobago, have been making
significant losses, the Observer relates.
About BWIA
BWIA was founded in 1940, and for more than 60 years has been
serving the Caribbean islands from Trinidad and Tobago, the hub
of the Americas, linking the twin island republic and many other
Caribbean islands with North America, South America, the United
Kingdom and Europe.
The airline has reportedly been losing US$1 million a week due
to poor operational management. An employee survey revealed
that lack of responsibility by the management is a major issue
in the company. Under the business plan, management will be
downsized to cut the losses.
About Air Jamaica
Air Jamaica -- http://www.airjamaica.com-- was founded in 1969.
It carries passengers and cargo to nearly 30 destinations in the
Caribbean, Europe, and North America. The Jamaican government
assumed full ownership of the airline after an investor group
turned over its 75% stake in late 2004. The government had
owned 25% of the company after it went private in 1994.
* * *
Air Jamaica's US$200 million 9-3/8% notes due July 18, 2015,
carries Moody's B1 rating and Standard & Poor's B rating.
===========
M E X I C O
===========
AXTEL SA: Launches Operations in Celaya, Guanajuato
---------------------------------------------------
Axtel S.A. de C.V. disclosed the official startup of its
operations in Celaya, Guanajuato.
The Mayor of Celaya, Jose Rivera Carranza, who made the first
telephone call over an Axtel line, attended the opening event.
In addition, Andres Velazquez Romero, Executive Director for the
Central Mexico Region, addressed a speech to the attendants.
The event was also attended by important business personalities
and representatives of the media, who witnessed the actual start
of the competition in fixed telephony in the city of Celaya.
The company informed that their network is already covering 85%
of the population with telephone, Internet, and advance data
services for users in the residential and business sectors.
Axtel reported that the direct investment that the company will
make in this city is in the amount of US$15 million over the
next five years.
Celaya is the second city in the State of Guanajuato where Axtel
is offering its services. The first one was Leon, where Axtel
started operating in January 2001.
"We are committed, before the authorities and the society of
Celaya, to offering an efficient service, a quality service that
meets and exceeds the expectations of our clients. We will
achieve this through an intelligent combination of technologies
and, above all, through the excellence and devotion of our
personnel", said Andres Velazquez, Axtel Executive Director for
the Central Mexico Region.
Axtel, which will invest US$150 million nationwide in 2006,
reported having installed 648 thousand lines by the end of March
this year.
At present, the company has the largest fixed wireless telephony
network in the world, as well as the metropolitan fiber optic
networks with the most advanced technology in Latin America.
Axtel, S.A. de C.V. provides local and long distance
telecommunications services, data transmission and Internet
services in Mexico, to both residential and business customers.
The company has 600,000 installed lines. Axtel posted net
profits of 306 million pesos (US$29 million) for 2005 compared
to a loss of 79.6 million pesos in 2004.
* * *
Axtel's 11% US$249,870,000 note due Dec. 15, 2013, is rated B1
by Moody's and B+ by Standard & Poor's.
DIRECTV GROUP: Buys Common Stock from GM Trust for US$265 Mil.
--------------------------------------------------------------
The DIRECTV Group, Inc. (NYSE:DTV) agreed to purchase a total of
15.5 million shares of its common stock, at US$17.12 per share
in cash, from the General Motors Special Hourly Employees
Pension Trust and the General Motors Special Salaried Employees
Pension Trust. The United States Trust Company of New
York acts as independent trustee for these plans.
The transaction is expected to be completed on May 24, 2006.
Including this transaction, DIRECTV Group has repurchased
approximately 141.5 million of its shares for an aggregate of
approximately US$2.24 billion out of its authorized US$3 billion
share repurchase program.
About DIRECTV
Headquartered in El Segundo, California, The DIRECTV Group, Inc.
-- http://www.directv.com/-- formerly Hughes Electronics
Corporation, provides multi-channel television entertainment,
and broadband satellite networks and services. The DIRECTV
Group, Inc., is 37% owned by Fox Entertainment Group, Inc.,
which is owned by News Corporation. DIRECTV is currently
available in Latin American countries: Argentina, Brazil, Chile,
Colombia, Costa Rica, Ecuador, El Salvador, Guatemala, Honduras,
Mexico, Nicaragua, Panama, Puerto Rico, Trinidad & Tobago,
Uruguay, Venezuela and several Caribbean island nations.
* * *
Standard & Poor's Rating Services placed a BB long-term foreign
and local credit issuer rating on The DIRECTV Group, Inc. on
August 9, 2004.
GENERAL MOTORS: Pension Fund Sells Stock to DIRECTV for US$265M
---------------------------------------------------------------
The DIRECTV Group, Inc. (NYSE:DTV) agreed to purchase a total of
15.5 million shares of its common stock, at US$17.12 per share
in cash, from the General Motors Special Hourly Employees
Pension Trust and the General Motors Special Salaried Employees
Pension Trust. The United States Trust Company of New
York acts as independent trustee for these plans.
The transaction is expected to be completed on May 24, 2006.
Including this transaction, DIRECTV Group has repurchased
approximately 141.5 million of its shares for an aggregate of
approximately US$2.24 billion out of its authorized US$3 billion
share repurchase program.
About DIRECTV
Headquartered in El Segundo, California, The DIRECTV Group, Inc.
-- http://www.directv.com/-- formerly Hughes Electronics
Corporation, provides multi-channel television entertainment,
and broadband satellite networks and services. The DIRECTV
Group, Inc., is 37% owned by Fox Entertainment Group, Inc.,
which is owned by News Corporation. DIRECTV is currently
available in Latin American countries: Argentina, Brazil, Chile,
Colombia, Costa Rica, Ecuador, El Salvador, Guatemala, Honduras,
Mexico, Nicaragua, Panama, Puerto Rico, Trinidad & Tobago,
Uruguay, Venezuela and several Caribbean island nations.
* * *
Standard & Poor's Rating Services placed a BB long-term foreign
and local credit issuer rating on The DIRECTV Group, Inc. on
August 9, 2004.
About General Motors
General Motors Corp. -- http://www.gm.com/-- the world's
largest automaker, has been the global industry sales leader for
75 years. Founded in 1908, GM today employs about 327,000
people around the world. With global headquarters in Detroit,
GM manufactures its cars and trucks in 33 countries including
Mexico. In 2005, 9.17 million GM cars and trucks were sold
globally under the following brands: Buick, Cadillac, Chevrolet,
GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn and
Vauxhall. GM operates one of the world's leading finance
companies, GMAC Financial Services, which offers automotive,
residential and commercial financing and insurance. GM's OnStar
subsidiary is the industry leader in vehicle safety, security
and information services.
* * *
As reported in the Troubled Company Reporter on May 9, 2006,
Moody's Investors Service placed the B3 senior unsecured rating
of General Motors Corporation under review for possible
downgrade, and affirmed the company's Corporate Family Rating at
B3. The rating actions are in response to the company's
disclosure that it is pursuing various options to replace or
amend its existing US$5.6 billion bank credit facility, and that
these options could result in providing its bank lenders with a
security interest in certain GM assets. GM anticipates that any
credit facility replacement or amendment will be completed by
the end of the second quarter or early in the third quarter.
GRUPO IUSACELL: Extends Deadline for Exchange Offer to June 1
-------------------------------------------------------------
Grupo Iusacell, S.A. de C.V., has extended until June 1 the
deadline for holders of its 14.25% bonds -- launched on April
18, 2006, and will due this year -- to accept an exchange offer
for 10% notes due in December 2013.
The deadline for the exchange offer was initially scheduled on
May 18, 2006. However, at the request of creditors, the
expiration date was moved.
As announced on April 18, 2006, and pursuant to the agreement
reached with the majority of its creditors, Iusacell launched a
solicitation of consents to:
-- exchange any and all of Existing Notes for 10.00% senior
secured notes due 2013, and
-- amend certain terms and conditions, waive certain existing
defaults as well as rescind acceleration under the
indenture governing the Existing Notes.
The exchange offer will expire at 5:00 p.m., New York City Time,
on June 1, 2006, unless extended by Iusacell.
All references in the Information Memorandum dated April 18,
2006, to the expiration date will include reference to the term
described. The restructuring of the Existing Notes will remain
in all other respects subject to all terms and conditions
described in the Information Memorandum dated April 18, 2006.
The Information and Exchange Agent for the exchange offer is
Bondholder Communications Group. The Information and Exchange
Agent can be reached by:
Bondholder Communications Group
E-mail: icalderon@bondcom.com
Phone: (44) 207-382-4580 in London
212-809-2663 in New York.
Headquartered in Mexico City, Mexico, Grupo Iusacell, S.A. de
C.V. (Iusacell, BMV: CEL) is a wireless cellular and PCS service
provider in Mexico with a national footprint. Independent of
the negotiations towards the restructuring of its debt, Iusacell
reinforces its commitment with customers, employees and
suppliers and guarantees the highest quality standards in its
daily operations offering more and better voice communication
and data services through state-of-the-art technology, including
its new 3G network, throughout all of the regions in which it
operate.
As of Dec. 31, 2005, Grupo Iusacell's stockholders' deficit
widened to MXN2,076,000,000 from a deficit of MXN1,187,000,000
at Dec. 31, 2004.
KANSAS CITY SOUTHERN: S&P Lowers Preferred Stock Rating to D
------------------------------------------------------------
Standard & Poor's Ratings Services lowered its preferred stock
ratings on Kansas City Southern to D from C and removed the
ratings from CreditWatch where they were initially placed on
March 23, 2006.
Ratings were previously lowered on April 4 and May 1 and
maintained on CreditWatch with negative implications.
Standard & Poor's other ratings on Kansas City Southern,
including its 'B' corporate credit rating, remain on CreditWatch
with negative implications, where they were initially placed
April 4, 2006. Ratings were lowered on April 10 and maintained
on CreditWatch.
"The downgrade on the preferred stock rating follows Kansas City
Southern's failure to make dividend payments due May 15, 2006,"
said Standard & Poor's credit analyst Lisa Jenkins. The company
was precluded from making the payments because of bond indenture
covenant restrictions.
At Dec. 31, 2005, Kansas City Southern failed to meet the
consolidated coverage ratio threshold of 2.00:1 included in its
bond indentures. The company has stated that it expects to
remain below this threshold until the end of the third quarter
of 2006. Failure to meet this threshold limits the company's
ability to pay cash dividends and to incur additional debt
except to repay existing debt.
The corporate credit and other ratings on Kansas City Southern
remain on CreditWatch due to concerns over the railroad
company's liquidity position. Standard & Poor's will meet with
management to discuss the company's current liquidity situation
and outlook. The ratings on CreditWatch could be lowered
further if it looks like liquidity will not improve over the
near to intermediate term.
Standard & Poor's affirms this rating of Kansas City Southern:
-- Corporate credit rating: B/Watch Neg/--
This rating has been lowered:
-- Preferred stock: D from C/Watch Neg
MERIDIAN AUTOMOTIVE: CSFB Seeks Claims Partial Summary Judgment
---------------------------------------------------------------
Pursuant to Rule 7056 of the Federal Rules of Bankruptcy
Procedure, Credit Suisse, Cayman Islands Branch, as First Lien
Administrative Agent and First Lien Collateral Agent of Meridian
Automotive Systems, Inc., and its debtor-affiliates, seeks
partial summary judgment as to five of the claims in the
Official Committee of Unsecured Creditors' complaint -- to enter
judgment declaring:
(1) void any security interest of the First Lien Lenders in
the Centralia Facility;
(2) that any interest of the First Lien Lenders and Second
Lien Lenders in the stock of the Guarantors is limited
to the equity value of the Guarantors as of the Petition
Date, and the equity value of each of the Guarantors;
(3) that the First Lien Lenders and Second Lien Lenders have
no security interest in the Debtors' Vehicles;
(4) that the First Lien Lenders and Second Lien Lenders have
no lien in the Debtors' Michigan Real Property; and
(5) that the Second Lien Lenders have no security interest
in MAS-Mexico's assets.
Dennis A. Meloro, Esq., at Greenberg Traurig, LLP, in
Wilmington, Delaware, relates that in October 2004, Meridian
Automotive Systems-Composites Operations, Inc., sought to sell
its facility in Centralia, Illinois, to a third-party buyer, and
hired First American Title Insurance Company to act as its
escrow agent for that sale.
As part of the Centralia Sale, Meridian Automotive Systems,
Inc., asked CSFB to release its liens on the Centralia Facility.
CSFB sent First American a transmittal letter, which enclosed a
UCC-3 financing statement amending the UCC-1 financing
statement. The Composites Amendment was designated an
amendment, and was not in any way designated a "termination,"
Mr. Meloro tells the Court.
Therefore, Mr. Meloro says, the Committee's first claim should
be dismissed because First American's unauthorized filing of the
Purported Termination Statement is ineffective as a matter of
Delaware law.
Mr. Meloro asserts that First American:
(a) did not have actual authority to file the Statement
because CSFB never authorized or instructed First
American to file any document other than the Composites
Amendment; and
(b) lacked apparent authority to file the Purported
Termination Statement because CSFB never publicly held
out First American as its agent or as authorized to act
on its behalf or to file the Purported Termination
Statement.
In addition, the "reasonably diligent title searcher" would have
noticed inconsistencies on the face of the Purported Termination
Statement and on the record, and would have been on notice that
it needed to inquire as to the true nature of that Statement.
The Debtors are not permitted to profit from the mistakes of
their own agent, Mr. Meloro contends.
Summary judgment is also appropriate as to the Committee's other
four claims because of the complete failure of proof regarding
those claims, Mr. Meloro adds.
The First Lien Credit Agreement
As reported in the Troubled Company Reporter on Sept. 9, 2005,
the Official Committee of Unsecured Creditors, on Meridian
Automotive Systems, Inc., and its debtor-affiliates' behalf,
wants to avoid certain liens and claims of the first lien
lenders and second lien lenders.
On April 28, 2004, Meridian Automotive Systems, Inc., entered
into a First Lien Credit Agreement with:
* Credit Suisse First Boston, as First Lien Administrative
Agent and First Lien Collateral Agent;
* Goldman Sachs Credit Partners L.P., as Syndication Agent;
and
* certain additional lenders party thereto from time to
time.
Gregory A. Taylor, Esq., at Ashby & Geddes, P.A., in Wilmington,
Delaware, relates that pursuant to the First Lien Credit
Agreement, the First Lien Lenders made available to MASI a US$75
million revolving credit facility and a Tranche B Term Loan in
the principal amount of US$235 million.
MASI and all of its affiliates that are guarantors under the
First Lien Credit Facility; and CSFB, as First Lien Collateral
Agent, also entered into a First Lien Guarantee And Collateral
Agreement dated April 28, 2004. Under the First Lien Collateral
Agreement, the First Lien Guarantors granted a security interest
to CSFB for the ratable benefit of the First Lien Lenders in
substantially all assets of the First Lien Guarantors, including
all Investment Property as defined in the First Lien Collateral
Agreement.
Pursuant to a U.C.C. Financing Statement filed with the Delaware
Department of State on Apr. 28, 2004, CSFB asserted a lien on
all assets of Meridian Automotive Systems Composites Operations,
Inc.
On Oct. 18, 2004, CSFB filed a U.C.C. Termination Statement
with the Delaware Department of State, terminating and releasing
CSFB's lien with respect to all assets of Meridian Composites.
Pursuant to a U.C.C. Financing Statement filed with the Delaware
Department of State on April 21, 2005, CSFB asserted a lien on
all of Meridian Composites' assets.
The Second Lien Credit Agreement
On Apr. 28, 2004, MASI also entered into a Second Lien Credit
Agreement with:
* CSFB, as Second Lien Administrative Agent and Second Lien
Collateral Agent;
* Goldman Sachs, as Syndication Agent; and
* 20 lenders party thereto from time to time.
Pursuant to the Second Lien Credit Agreement, the Second Lien
Lenders made available to MASI a Tranche C Term Loan in the
aggregate principal amount of US$175 million.
MASI and all of its affiliates that are guarantors under the
Second Lien Credit Facility and CSFB, as Second Lien Collateral
Agent, also entered into a Second Lien Guarantee And Collateral
Agreement dated as of Apr. 28, 2004. Under the Second Lien
Collateral Agreement, the Second Lien Guarantors granted a
security interest to CSFB for the ratable benefit of the Second
Lien Lenders in substantially all assets of the Second Lien
Guarantors, including all Investment Property.
Mr. Taylor tells the Court that Section 5.8 of the First Lien
Collateral Agreement and Second Lien Collateral Agreement limits
the Lien Lenders' security interest in the stock of any Foreign
Subsidiary to 65% of that stock to the extent necessary to avoid
adverse tax consequence to any Grantor.
Avoidance Action
Pursuant to the DIP Order, the Official Committee is authorized
and has standing to file and prosecute an adversary proceeding
avoiding the First and Second Lien lenders' claims.
(A) Avoidance as a Preferential Transfer the First Lien Lenders'
Asserted Lien on All Assets of Meridian Composites
Mr. Taylor asserts that the Preferential Composites
Financing Statement purported to perfect a security
interest in all assets of Composites in favor of CSFB for
the ratable benefit of the First Lien Lenders.
Mr. Taylor tells the Court that the Preferential Composites
Transfer:
(i) occurred within the 90 days prior to the Petition
Date;
(ii) constitutes a transfer of an interest in one or more
of the Debtors' property;
(iii) was for the benefit of the First Lien Lenders, each
of whom was a creditor of one or more of the Debtors
prior to and at the time the Preferential Composites
Transfer was made;
(iv) was on account of one or more antecedent debts owed
by the Debtors to the First Lien Lenders before the
Preferential Composites Transfer was made;
(v) was made while the Debtors, including Meridian
Composites, were insolvent;
(vi) will enable the First Lien Lenders to receive more
than they would have if:
-- the Debtors' Chapter 11 cases were cases under
Chapter 7 of the Bankruptcy Code;
-- the Preferential Composites Transfer had not been
made; and
-- the First Lien Lenders received payment of their
debts under the provisions of the Bankruptcy
Code.
Thus, the Committee is entitled to a Court judgment
avoiding, recovering, and preserving for the benefit of the
Debtors' estates the Preferential Composites Transfer or
its value, Mr. Taylor contends.
(B) Declaration of the Extent of the Guarantees Given by the
Debtors for the First and Second Lien Lenders' Benefit
Pursuant to the First Lien and Second Lien Collateral
Agreements, each Guarantor's guarantee of MASI's
obligations under the First Lien Facility and the Second
Lien Facility is limited to the amount, which can be
guaranteed by the Guarantor under applicable federal and
state laws relating to the insolvency of debtors.
Thus, Mr. Taylor asserts that any claims by the First Lien
Lenders or the Second Lien Lenders against each of the
Guarantors under the two Lien Collateral Agreements can be
no greater than the equity value of each Guarantor as of
the Petition Date.
(C) Declaration and Avoidance of the First Lien Lenders' and
Second Lien Lenders' Security Interests in the Stock of
MASI's Foreign Subsidiaries
Mr. Taylor relates that upon information and belief, each
Grantor under the First Lien Collateral Agreement and
Second Lien Credit Agreement will suffer adverse tax
consequences if the First Lien Lenders and Second Lien
Lenders hold a security interest in excess of 65% of the
Pledged Stock of the Foreign Subsidiaries.
(D) Declaration and Avoidance of First Lien Lenders' and Second
Lien Lenders' Security Interests in Certain Assets of the
Debtors.
Mr. Taylor relates that the First Lien Lenders and Second
Lien Lenders assert that they hold a valid, perfected and
enforceable security interest in:
(1) certain assets of the Debtors which are located
outside of the United States, including certain
patents and patent applications registered or
pending in various foreign countries;
(2) certain vehicles owned by the Debtors;
(3) the capital stock of Meridian Automotive Systems -
DO Brasil LTDA;
(4) three real properties owned by the Debtors:
* 5214 Kraft Ave., Grand Rapids, Michigan;
* 5292 Kraft Ave., Grand Rapids, Michigan; and
* Grand River Ave., Fowlerville, Michigan;
(5) the capital stock of Meridian Automotive Systems, S.
de R.L. de C.V, MASM Employee Leasing Company, S. De
R.L. de C.V., and MASM Employee Leasing Company
Muzquiz Operations, S. De R.L. de C.V; and
(6) the assets owned by Meridian Automotive Systems -
Mexico Operations, LLC.
Mr. Taylor argues that the First Lien Lenders and Second
Lien Lenders have not taken the necessary steps to perfect
any security interests they may have been granted in the
Debtors' assets. Therefore, the First Lien Lenders and
Second Lien Lenders do not hold valid, perfected and
enforceable security interests in the Debtors' assets.
(E) Declaration that the Lien Collateral Agreements are Void for
Lack of Consideration with Respect to Meridian Automotive
Systems - Mexico Operations, LLC
Mr. Taylor contends that when MAS-Mexico executed the First
Lien Collateral Agreement and Second Lien Collateral
Agreement in June 2004, MAS-Mexico received no
consideration from the First Lien Lenders and Second Lien
Lenders.
Thus, MAS-Mexico's pledge of its capital stock and
guarantee of MASI's obligations under the First Lien
Facility and Second Lien Facility is voidable for lack of
consideration, Mr. Taylor asserts.
The Committee asks the U.S. Bankruptcy Court for the District of
Delaware to enter a judgment declaring:
(1) void any security interest of the First Lien Lenders in
the Centralia Facility;
(2) that any interest of the First Lien Lenders and Second
Lien Lenders in the stock of the Guarantors is limited
to the equity value of the Guarantors as of the Petition
Date, and the equity value of each of the Guarantors;
(3) any security interest of the First Lien Lenders and
Second Lien Lenders in the Pledged Stock of the Foreign
Subsidiaries is limited to 65%, or the lesser amount as
is appropriate, of the total capital stock of the
Foreign Subsidiaries;
(4) that the First Lien Lenders and Second Lien Lenders have
no security interest in the Debtors' Foreign Assets;
(5) that the First Lien Lenders and Second Lien Lenders have
no security interest in the Debtors' Vehicles;
(6) that the First Lien Lenders and Second Lien Lenders have
no security interest in the capital stock of MAS-Brazil;
(7) that the First Lien Lenders and Second Lien Lenders have
no lien in the Debtors' Michigan Real Property;
(8) the First Lien Collateral Agreement and Second Lien
Collateral Agreement void for lack of consideration with
respect to MAS-Mexico:
-- avoiding any security interest asserted by the
First Lien Lenders and Second Lien Lenders in the
capital stock of MAS-Mexico; and
-- disallowing all claims of the First Lien Lenders
and Second Lien Lenders against MAS-Mexico; and
(9) that the Second Lien Lenders have no security interest
in MAS-Mexico's assets.
About Meridian Automotive
Headquartered in Dearborn, Mich., Meridian Automotive Systems,
Inc. -- http://www.meridianautosystems.com/-- supplies
technologically advanced front and rear end modules, lighting,
exterior composites, console modules, instrument panels and
other interior systems to automobile and truck manufacturers.
Meridian operates 22 plants in the United States, Canada and
Mexico, supplying Original Equipment Manufacturers and major
Tier One parts suppliers. The Company and its debtor-affiliates
filed for chapter 11 protection on April 26, 2005 (Bankr. D.
Del. Case Nos. 05-11168 through 05-11176). James F. Conlan,
Esq., Larry J. Nyhan, Esq., Paul S. Caruso, Esq., and Bojan
Guzina, Esq., at Sidley Austin Brown & Wood LLP, and Robert S.
Brady, Esq., Edmon L. Morton, Esq., Edward J. Kosmowski, Esq.,
and Ian S. Fredericks, Esq., at Young Conaway Stargatt & Taylor,
LLP, represent the Debtors in their restructuring efforts. Eric
E. Sagerman, Esq., at Winston & Strawn LLP represents the
Official Committee of Unsecured Creditors. The Committee also
hired Ian Connor Bifferato, Esq., at Bifferato, Gentilotti,
Biden & Balick, P.A., to prosecute an adversary proceeding
against Meridian's First Lien Lenders and Second Lien Lenders to
invalidate their liens. When the Debtors filed for protection
from their creditors, they listed US$530 million in total assets
and approximately US$815 million in total liabilities.
(Meridian Bankruptcy News, Issue No. 27; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
PROGRESS RAIL: Inks US$1-Bil. Merger Agreement with Caterpillar
---------------------------------------------------------------
Caterpillar Inc. has reached an agreement to acquire Progress
Rail Services, Inc., for $1 billion in cash, stock and
assumption of debt. Progress Rail is majority owned by One
Equity Partners, a private equity affiliate of JP Morgan Chase &
Company, Inc.
Based in Albertville, Alabama, Progress Rail is a leading
provider of remanufactured locomotive and railcar products and
services to the North American railroad industry. With 2005
sales of US$1.2 billion, the company has one of the most
extensive rail service and supply networks in North America. It
operates more than 90 facilities in 29 states in the United
States, Canada and Mexico, with about 3,700 employees.
"This is an important acquisition due to its size and scope.
The rail aftermarket services business is a strong fit with our
strategic direction and will leverage our remanufacturing
capability," said Caterpillar Chairman and Chief Executive
Officer Jim Owens. "Progress Rail provides excellent
diversified growth to Caterpillar, enhancing our ability to
deliver attractive profitability throughout the business
cycles."
"I am extremely pleased that Progress Rail is becoming part of
the Caterpillar family," commented William P. Ainsworth,
president and chief executive officer of Progress Rail.
"Progress Rail's success has been attributable to our dedicated
employees and commitment to our valued customers, and
Caterpillar shares these same values with our company. By
leveraging the world-class capabilities of Caterpillar within
Progress Rail, the future is bright for our employees, our
customers and our business."
Progress Rail offers a full range of reconditioned and
remanufactured railcar components, rail and track products,
railcar and locomotive repair, rail welding, maintenance of way
equipment and railcar dismantling.
"Progress Rail is a leading aftermarket services provider to the
rail industry, and this is a premier opportunity for Caterpillar
to continue to grow its services portfolio," said Steve Fisher,
Caterpillar vice president with responsibility for
remanufacturing. "They provide highly integrated solutions,
have developed important long-term customer relationships with
the railroads and have earned an excellent reputation throughout
the industry. We are especially pleased that Billy Ainsworth
and the senior management team will join Caterpillar and
continue to lead Progress Rail. Together, we will be very well
positioned to better serve the rapidly growing railroad
maintenance and repair business."
"There are significant benefits as Progress Rail becomes part of
Caterpillar," said Steve Wunning, Caterpillar group president.
"Progress Rail is very customer focused and brings an extensive
network of aftermarket operations in the United States, Canada
and Mexico. Together, we will be able to provide a broader
array of services to the rail industry and expand outside of
North America to the rest of the world. Progress Rail will use
Caterpillar's extensive remanufacturing technology and processes
to build upon their already superior capability. We expect this
transaction to be accretive to our 2006 earnings and exceed our
internal hurdle rate."
Under the terms of the agreement, Caterpillar will acquire
Progress Rail for approximately US$800 million in cash and
Caterpillar stock, and US$200 million through the assumption of
long-term debt. Of the approximately US$800 million, 53% is
expected to be paid in cash and 47% in Caterpillar stock. The
transaction closing is subject to obtaining regulatory approvals
and should take place around the end of second quarter 2006.
Monroe Securities and Lehman Brothers provided the financial
advisory services, and Mayer Brown Rowe & Maw provided legal
services to Caterpillar. Credit Suisse, JP Morgan and Morgan
Stanley provided advisory services, and Morgan Lewis & Bockius
provided legal services to Progress Rail.
About Caterpillar
Caterpillar Inc. -- http://www.CAT.com/-- is the world's
leading manufacturer of construction and mining equipment,
diesel and natural gas engines and industrial gas turbines.
About One Equity Partners
One Equity Partners -- http://www.oneequity.com/-- manages US$5
billion of investments and commitments for JP Morgan Chase & Co.
in direct private equity transactions. Partnering with
management, OEP invests in transactions that initiate strategic
and operational changes in businesses to create long-term value.
OEP's investment professionals are located across North America
and Europe, with offices in New York, Chicago and Frankfurt.
About Progress Rail
Headquartered in Albertville, Alabama, Progress Rail --
http://www.progressrail.com/-- is one of the largest
diversified providers of outsourced maintenance and repair
services to the railroad industry in North America. Progress
Rail offers a broad array of products and services for the
maintenance and repair of railcars, locomotives and track
infrastructure. With more than 90 facilities located throughout
the United States, Canada and Mexico, Progress Rail is
strategically located and well equipped to meet its growing
customer demands.
PROGRESS RAIL: Caterpillar Merger Cues Moody's to Review Ratings
----------------------------------------------------------------
Moody's Investors Service placed its ratings of Progress Rail
Services Holdings Corporation and its subsidiary PRSC
Acquisition Corp., on review for possible upgrade. The review
was prompted by the announcement that Caterpillar Inc. will be
purchasing Progress Rail for US$1 billion including the
assumption of Progress Rail's US$200 million of 7.75% Senior
Unsecured Notes due 2012 issued by Progress Rail's subsidiary,
PRSC Acquisition Corp.
The review of Progress Rail's ratings will focus on the
potential credit benefits for Progress Rail as part of the
larger Caterpillar, including the potential for and nature of
any explicit support for Progress Rail's debt holders from
Caterpillar.
Moody's notes that Progress Rail's Notes are non-callable before
April 1, 2008 and contain various restrictive provisions as well
as a requirement to offer to repurchase the bonds at 101% of
face value in the event of a change of control.
Moody's believes that it is possible that some portion of
Progress Rail's debt could be repaid in conjunction with the
acquisition. If any Progress Rail debt remains outstanding
following the acquisition and is unconditionally guaranteed by
Caterpillar, the rating will likely be upgraded to Caterpillar's
current A2 rating.
If any remaining Progress Rail debt is not guaranteed by
Caterpillar, and the company continues to make adequate
financial information available, the Progress Rail rating could
be upgraded modestly but might remain within the speculative
grade range. Should the company not make financial information
regarding Progress Rail available, the ratings would be
withdrawn.
According to Caterpillar, the transaction is expected to be
funded with approximately US$425 million of cash and US$375
million in Caterpillar stock, in addition to the assumption of
the Notes.
On Review for Possible Upgrade:
Issuer: PRSC Aquisition Corp.
* Senior Unsecured Regular Bond/Debenture, Placed on Review
for Possible Upgrade, currently B2
Issuer: Progress Rail Services Holdings Corporation
* Corporate Family Rating, Placed on Review for Possible
Upgrade, currently B1
Outlook Actions:
Issuer: PRSC Aquisition Corp.
* Outlook, Changed To Rating Under Review From Stable
Issuer: Progress Rail Services Holdings Corporation
* Outlook, Changed To Rating Under Review From Stable
The Speculative Grade Rating of SGL-2 is unaffected at this
time.
Progress Rail Services Holdings, headquartered in Albertville,
AL, provides outsourced maintenance and repair services and
products to the railroad industry in North America.
=================
N I C A R A G U A
=================
* NICARAGUA: Liberal Party Balks at Oil Accord with PDVSA
---------------------------------------------------------
As previously reported, Venezuela, through state-owned firm
Petroloes de Venezuela SA, agreed to deliver oil to Nicaragua
under preferential terms.
Under the oil accord, PDVSA will sell 10 million barrels of oil
annually to Nicaraguan municipalities. PDVSA will receive 60%
of payment within 90 days of shipment, and the remaining 40%
will be paid off over 25 years at 1% interest, including a two-
year grace period.
However, Nicaragua's Constitutionalist Liberal Party disregarded
the agreement signed by PDVSA and Managua Mayor Dionisio
Marenco.
"This agreement is to enrich Sandinist mayors and fund the
electoral campaign of the National Liberation Sandinist Front
(FSLN)," PLC Vice-President Wilfredo Navarro was quoted by El
Universal as saying.
According to Mr. Navarro, 56 liberal mayors will leave the
Nicaraguan Association of Municipalities to signal their
disapproval of the agreement with PDVSA, El Universal relates.
Petroleos de Venezuela SA aka PDVSA is Venezuela's state oil
company in charge of the development of the petroleum,
petrochemical and coal industry, as well as planning,
coordinating, supervising and controlling the operational
activities of its divisions, both in Venezuela and abroad.
* * *
Moody's Investor Service assigned these ratings to Nicaragua:
Rating Rating Date
------ -----------
Long Term Caa1 June 30, 2003
Senior Unsecured
Debt B3 June 30, 2003
* * *
On Jan. 23, 2005, Fitch Ratings upgraded the local and foreign
currency ratings of Petroleos de Venezuela S.A. aka PDVSA to
'BB-' from 'B+'. The rating of PDVSA's export receivable
future flow securitization, PDVSA Finance Ltd, was also upgraded
to 'BB+' from 'BB'. In addition, Fitch has assigned PDVSA a
'AAA(ven)' national scale rating. The Rating Outlook is
Stable. Both rating actions follow Fitch's November 2005
upgrade of Venezuela's sovereign rating.
===========
P A N A M A
===========
* PANAMA: Reduction in Fuel Prices to Remain Until May 31
---------------------------------------------------------
The reduction in fuel prices in Panama is expected to remain
until May 31, 2006, Prensa Latina reports.
Prensa Latina relates that the prices were slightly reduced on
Thursday after the transportation workers held a demonstration
against the unstoppable increase in crude prices. The workers
had threatened to destabilize the government.
The Authorities for Customer Protection and Competence Defense
told Prensa Latina that these reductions were imposed on:
-- 91-octane gasoline gallon to US$3.04 dollars,
-- 95-octane gallon to US$3.28, and
-- diesel oil US$0.04 under the US$3 per gallon.
According to Prensa Latina, the government disclose on Saturday
that it plans to subsidy the diesel oil for another four months.
The government has allocated a US$1 million in this measure.
Manuel Jose Paredes, the minister of Interior Trade in Panama,
told Prensa Latina that the subsidy was decided with the hope
that price of fuel at the international market would decrease.
If the crisis continues we would have to analyze other
alternatives, Minister Paredes was quoted by Prensa Latina as
saying.
The stabilization of tariffs is placed at US$250,000 dollars per
month, Prensa Latina reports.
* * *
Fitch Ratings assigned these ratings on Panama:
Rating Rating Date
------ -----------
Country Ceiling BBB Apr. 8, 2005
Long Term IDR BB+ Dec. 14, 2005
Short Term IDR B Dec. 14, 2005
Local Currency
Long Term Issuer
Default Rating BB+ Dec. 14, 2005
=======
P E R U
=======
* PERU: Begins Drilling Operation on Gas Block 56
-------------------------------------------------
The drilling of Peru's block 56, located near the Camisea's
block 88 in the southeastern jungle, has started on
May 20, 2006, Norberto Benito -- the general manager of
Pluspetrol Peru Corp., which operates the block -- told Dow
Jones Newswires.
Mr. Benito related to Dow Jones that the first well will take
about 70 days to finish and at that rate, they will possibly
drill three wells for this year.
The consortium that handles the block intends to drill six
wells, each costing US$17 million to US$18 million, Mr. Benito
informed Dow Jones.
"Our aim is that we are producing gas by the first quarter of
2008," Mr. Benito told Dow Jones.
Dow Jones reports that gas production from Block 56 will be
allocated for export and will provide Peru LNG Co. -- controlled
by US' Hunt Oil Co., South Korea's SK Corp. and Spain's Repsol
YPF. This is the group that developed the Camisea natural gas
project's upstream phase.
According to Dow Jones, the group's supply will be exported to
Mexico, where it plans to ship LNG by 2009.
The same infrastructure will be used in the drilling process but
an expansion may be necessary, Dow Jones states.
The development of the block may cause some US$600 million, Dow
Jones reports.
Block 56 presently holds 2.75 trillion cubic feet of natural
gas, the Ministry of Energy and Mine told Dow Jones.
* * *
Fitch Ratings assigned these ratings on Peru:
Rating Rating Date
------ -----------
Country Ceiling BB Nov. 18, 2004
Long Term IDR BB Dec. 14, 2005
Short Term IDR B Dec. 14, 2005
Local Currency
Long Term Issuer
Default Rating BB+ Dec. 14, 2005
* PERU: Minister Proposes Law on Voluntary Payment of Royalties
---------------------------------------------------------------
Glodomiro Sanchez, the energy and mines minister of Peru, made a
proposal to the nation's Congress to create a law that will
allow a voluntary payment of royalties by firms, Dow Jones
Newswires reports.
Dow Jones states that Minister Sanchez wanted to allow voluntary
payment regardless of whether the companies have tax-stability
agreements.
The minister informed Dow Jones that a legislation could be
passed that will allow companies to voluntarily pay the
royalties without affecting existing contracts.
Andina, the government news agency, told Dow Jones, "Congress
has the final word on this issue and surely it can find an
alternative so that paying the royalties can be a reality."
Dow Jones recalls that the Congress passed a law in 2004 that
created royalties of:
-- 1% on mining company sales up to US$60 million,
-- 2% on sales from US$60 million to US$120 million, and
-- 3% on sales more than US$120 million.
According to Dow Jones, the mining sector was strongly against
the law.
There are 10 mining firms that do not pay because they are
protected by tax-stability accords, the Sunat tax agency told
Dow Jones. Among those companies are:
-- Minera Yanacocha SRL, operated by Newmont Mining Corp., and
-- Antamina, owned by:
* BHP Billiton,
* Falconbridge Ltd.,
* Teck Cominco Ltd., and
* Mitsubishi Corp.
Those companies claim they are disqualified from paying
royalties by the agreements and that they make significant
social investment in the areas where they operate, Dow Jones
relates. This has angered the legislators.
Congressman Jose Carrasco -- a member of the congressional
energy and mines commission -- complained to Dow Jones, "It is
not fair that the companies with the highest production volumes
and enormous income thanks to the rise in the price of minerals
are the ones that do not pay royalties."
According to Dow Jones, Minister Sanchez said at a presentation
to the congressional energy and mines commission that the
ministry is working with mining firms to ensure that their
social obligations are met.
* * *
Fitch Ratings assigned these ratings on Peru:
Rating Rating Date
------ -----------
Country Ceiling BB Nov. 18, 2004
Long Term IDR BB Dec. 14, 2005
Short Term IDR B Dec. 14, 2005
Local Currency
Long Term Issuer
Default Rating BB+ Dec. 14, 2005
=====================
P U E R T O R I C O
=====================
BURGER KING: Prices 25M Common Stock Offering at US$17 per Share
----------------------------------------------------------------
Burger King Holdings, Inc., reported the pricing of its initial
public offering of 25,000,000 shares of common stock, at a price
of US$17 per share. The shares will be listed on the New York
Stock Exchange and will trade under the symbol "BKC" beginning
May 18, 2006. The 25,000,000 shares will be sold by the
company. The underwriters have an option to purchase up to an
additional 3,750,000 shares from the selling stockholders at the
initial public offering price less the underwriting discount.
The Company expects to receive net proceeds of approximately
US$393 million from the offering and intends to use the net
proceeds for repayment of US$350 million of outstanding debt
related to the company's senior secured credit facility with the
balance used for general business purposes. The Company will not
receive any proceeds from a sale of the shares by the selling
stockholders if the underwriters exercise their option to
purchase additional shares. Following this offering, Burger
King Holdings, Inc., will remain majority-owned by the equity
sponsor group comprised of Texas Pacific Group, Bain Capital
Partners and the Goldman Sachs Funds.
J.P. Morgan Securities Inc., Citigroup Global Markets Inc.,
Goldman, Sachs & Co. and Morgan Stanley & Co. Incorporated have
acted as joint book-running managers for the offering.
A copy of the Burger King Holdings, Inc. final prospectus
related to this offering, when available, may be obtained by
contacting:
J.P. Morgan Securities Inc.
Distribution & Support Service
Northeast Statement Processing
4 Chase Metrotech Center, CS Level
Brooklyn, NY 11245
Telephone (718) 242-8002
Citigroup Global Markets Inc.
Prospectus Department
140 58th Street
Brooklyn, NY 11220
Telephone (718) 765-6732
Goldman, Sachs & Co.
Prospectus Department
85 Broad Street
New York, NY 10004
Fax (212) 902-9316
Morgan Stanley & Co. Incorporated
180 Varick Street
New York, NY 10014
About Burger King
Miami, Fla.-based, The Burger King -- http://www.burgerking.com/
-- operates more than 11,000 restaurants in more than 60
countries and territories worldwide. Approximately 90% of
Burger King restaurants are owned and operated by independent
franchisees, many of them family-owned operations that have been
in business for decades. Burger King Holdings Inc., the parent
Company, is private and independently owned by an equity sponsor
group comprised of Texas Pacific Group, Bain Capital and Goldman
Sachs Capital Partners.
Burger King Corporation operates restaurants in the Latin
American, Caribbean and Mexican Region. The company's first
international restaurant opened in 1963 in Puerto Rico. Since
1994, Burger King has opened more than 300 restaurants in the
Latin American region, producing some of the strongest
comparable store sales growth for the brand around the world.
Burger King(R) restaurants in Latin America serve approximately
1,600 customers per day each, making them some of the highest
volume restaurants in the system.
* * *
As reported in the Troubled Company Reporter on Feb. 6, 2006,
Moody's Investors Service assigned a Ba2 rating to Burger King
Corporation's proposed US$350 million senior secured term loan B
add-on facility. Moody's also affirmed the company's Ba2
corporate family rating as well as the Ba2 rating assigned to
BKC's US$250 million senior secured term loan A; US$750 million
senior secured term loan B; and US$150 million senior secured
revolving credit facility. In addition, Moody's changed the
outlook for BKC to negative from stable.
As reported in the Troubled Company Reporter on Feb. 6, 2006,
Standard & Poor's Ratings Services assigned its 'B+' rating to
Burger King Corp.'s proposed US$350 million add-on to its
existing secured term loan B, which matures in 2012. The
recovery rating on the company's US$1.496 billion credit
facility was lowered to '3' from '2'. The rating and recovery
rating indicate the expectation for meaningful (50%-80%)
recovery of principal in the event of a payment default. At the
same time, Standard & Poor's placed its ratings on Burger King,
including the 'B+' corporate credit and bank loan ratings, on
CreditWatch with positive implications.
DORAL FINANCIAL: Closes Repurchase & Resale of US$608M Loans
------------------------------------------------------------
Doral Financial Corporation disclosed that, on May 15 and May
16, 2006, it closed the repurchase and subsequent resale of
approximately US$608 million of mortgage loans previously sold
to Banco Santander Puerto Rico, a wholly owned subsidiary of
Santander BanCorp.
On April 19, 2006, Doral entered into an agreement with Banco
Santander under which Doral agreed to acquire from Banco
Santander certain mortgage loans previously sold by Doral to
Banco Santander during 2004 and the first quarter of 2005.
Substantially all the mortgage loans purchased from Banco
Santander were resold to a third party on May 15 and May 16,
2006. The transactions are not expected to have a material
impact on the company's results of operations but will have a
positive impact on the company's regulatory capital ratios.
Doral is currently engaged in negotiations with several local
financial institutions to restructure the terms of certain prior
mortgage loan transfers and related servicing arrangements,
certain of which had been recharacterized as secured borrowings.
About Doral Financial
Doral Financial Corporation -- http://www.doralfinancial.com/
-- a financial holding company, is the largest residential
mortgage lender in Puerto Rico, and the parent company of Doral
Bank, a Puerto Rico based commercial bank, Doral Securities, a
Puerto Rico based investment banking and institutional brokerage
firm, Doral Insurance Agency, Inc. and Doral Bank FSB, a federal
savings bank based in New York City.
* * *
As reported in the Troubled Company Reporter on March 27, 2006,
Moody's Investors Service downgraded to B1 from Ba3 the senior
debt ratings of Doral Financial Corporation, and reiterated the
negative rating outlook. Moody's action follows cease and
desist orders placed by banking regulators on Doral and some of
its subsidiaries, including Doral Bank, San Juan, Puerto
Rico. When Moody's last downgraded Doral's debt on Oct. 28,
2005, it issued a negative rating outlook, but noted that any
credit deterioration including regulatory consequences or
liquidity issues could result in a review for possible downgrade
or an outright downgrade.
DORAL FINANCIAL: Gets Approval to Pay Dividends on Stock
--------------------------------------------------------
Doral Financial Corporation, a financial services company, had
received regulatory approval for the payment of dividends for
the months of May and June 2006 on its three outstanding series
of monthly income preferred stock. On May 16, 2006, the Board
of Directors approved the regular monthly cash dividend on
Doral's:
-- 7% Noncumulative Monthly Income Preferred Stock, Series A,
in the amount of US$0.2917 per share;
-- 8.35% Noncumulative Monthly Income Preferred Stock,
Series B, in the amount of US$0.173958 per share; and
-- 7.25% Noncumulative Monthly Income Preferred Stock,
Series C, in the amount of US$0.151042 per share.
The dividends on each of the series is payable on May 31, 2006,
and the record date is the close of business on May 29, 2006, in
the case of the Series A Preferred Stock, and the close of
business on May 15, 2006, in the case of the Series B and Series
C Preferred Stock.
Regulatory approval for the payment of dividends on Doral's
equity securities is required as a result of the consent orders
entered into with the Board of Governors of the Federal Reserve
System, the Federal Deposit Insurance Corporation and the
Commissioner of Financial Institutions of Puerto Rico.
About Doral Financial
Doral Financial Corporation -- http://www.doralfinancial.com/
-- a financial holding company, is the largest residential
mortgage lender in Puerto Rico, and the parent company of Doral
Bank, a Puerto Rico based commercial bank, Doral Securities, a
Puerto Rico based investment banking and institutional brokerage
firm, Doral Insurance Agency, Inc. and Doral Bank FSB, a federal
savings bank based in New York City.
* * *
As reported in the Troubled Company Reporter on March 27, 2006,
Moody's Investors Service downgraded to B1 from Ba3 the senior
debt ratings of Doral Financial Corporation, and reiterated the
negative rating outlook. Moody's action follows cease and
desist orders placed by banking regulators on Doral and some of
its subsidiaries, including Doral Bank, San Juan, Puerto
Rico. When Moody's last downgraded Doral's debt on Oct. 28,
2005, it issued a negative rating outlook, but noted that any
credit deterioration including regulatory consequences or
liquidity issues could result in a review for possible downgrade
or an outright downgrade.
GLOBAL HOME: Wants to Hire Houlihan Lokey as Investment Banker
--------------------------------------------------------------
Global Home Products, LLC, and its debtor-affiliates ask the
U.S. Bankruptcy Court for the District of Delaware for
permission to employ Houlihan Lokey Howard & HukinZukin Capital,
Inc., as their investment banker.
Houlihan Lokey will:
a. assist in the review of the Burnes Group's financial
position, financial history, operations, competitive
environment, and assets to assist the Debtors in
determining the best means and timing to effect a
transaction with a potential acquirer and strategic
partner, including any of the Debtors' current and former
creditors, and any of the Debtors' affiliates, provided
that neither Cerberus Capital Management nor any of its
affiliates will be deemed to be an acquirer;
b. assist in the development of a list of potential acquirers
and interact with potential acquirers in order to create
interest in one or more transactions;
c. assist in the development of a coordinated sales process;
d. assist in the preparation, with substantial input from the
Debtors, of an offering memorandum to provide to, and
discuss with potential acquirers;
e. actively participate in the negotiating process regarding
a transaction, and coordinate the process with the Debtors
and its other advisors, and otherwise reasonably assist
the Debtors in effectuating each transaction; and
f. assist in the development and presentation of the
Restructuring Alternatives Analyses, as requested by the
Debtors.
The Debtors tell the Court that prior to filing for bankruptcy,
they paid the Firm a US$150,000 retainer. The Firm will receive
a monthly fee of US$75,000 for the Restructuring Alternatives
Analysis services that it will perform. Additionally, the
Debtors will pay the Firm an initial amount of US$1 million upon
the consummation of a transaction with an acquirer, plus
incremental amounts according to the base value of the
transaction.
Adam L. Dunayer, a director at Houlihan Lokey, assures the Court
that the Firm is "disinterested" as that term is defined in
Section 101(14) of the Bankruptcy Code.
Headquartered in Westerville, Ohio, Global Home Products, LLC
-- http://www.anchorhocking.com/and http://www.burnesgroup.com/
-- sells houseware and home products and manufactures high
quality glass products for consumers and the food services
industry. The company also designs and markets photo frames,
photo albums and related home decor products. The company and
16 of its affiliates, including Burnes Puerto Rico, Inc., and
Mirro Puerto Rico, Inc., filed for Chapter 11 protection on Apr.
10, 2006 (Bankr. D. Del. Case No. 06-10340). Laura Davis Jones,
Esq., Bruce Grohsgal, Esq., James E. O'Neill, Esq., and Sandra
G.M. Selzer, Esq., at Pachulski, Stang, Ziehl, Young, Jones &
Weintraub LLP, represent the Debtors. When the company filed
for protection from their creditors, they estimated assets
between US$50 million and US$100 million and debts of more than
US$100 million.
KMART CORP: Court Allows NJ Tax Court to Adjudicate 2005 Appeal
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois
approved the request of Kmart Corporation, its debtor-affiliates
and Troy CMBC Property, LLC, to issue an order authorizing the
Tax Court to proceed and to adjudicate the 2005 Appeal.
As reported in the Troubled Company Reporter on May 2, 2006,
Troy took an appeal of the 2005 valuation of its taxable assets
located within the City of Linden, in New Jersey.
Pursuant to New Jersey state law and procedure, the appeal was
taken to the Tax Court of New Jersey, as a proceeding brought by
Troy to reduce the 2005 taxable value of the property.
Kimberly Robinson, Esq., at Barack Ferazzano Kirschbaum Perlman
& Nagelberg LLP, in Chicago, Illinois, relates that simultaneous
with the proceeding, the Debtors negotiated with Linden on some
claimed 2002 taxes, to which the Debtors had timely objected.
Subject to reinstatement, the Tax Court dismissed the 2005
Appeal because there were still taxes unpaid for prior years.
Subsequently, the Debtors and Linden negotiated a settlement of
the 2002 taxes, and jointly agreed to the 2005 Appeal's
reinstatement.
In response to a joint application of Troy and Linden, the Tax
Court ordered reinstatement of the 2005 Appeal but was concerned
about its authority to proceed absent closure of the Chapter 11
cases or an order from the Bankruptcy Court authorizing the Tax
Court to proceed.
Headquartered in Troy, Michigan, Kmart Corporation (n/k/a KMART
Holding Corporation) -- http://www.bluelight.com/-- operates
approximately 2,114 stores, primarily under the Big Kmart or
Kmart Supercenter format, in all 50 United States, Puerto Rico,
the U.S. Virgin Islands and Guam. The Company filed for chapter
11 protection on January 22, 2002 (Bankr. N.D. Ill. Case No.
02-02474). Kmart emerged from chapter 11 protection on May 6,
2003. John Wm. "Jack" Butler, Jr., Esq., at Skadden, Arps,
Slate, Meagher & Flom, LLP, represented the retailer in its
restructuring efforts. The Company's balance sheet showed
US$16,287,000,000 in assets and US$10,348,000,000 in debts when
it sought chapter 11 protection. Kmart bought Sears, Roebuck &
Co., for US$11 billion to create the third-largest U.S.
retailer, behind Wal-Mart and Target, and generate US$55 billion
in annual revenues. The waiting period under the Hart-Scott-
Rodino Antitrust Improvements Act expired on Jan. 27, without
complaint by the Department of Justice. (Kmart Bankruptcy News,
Issue No. 110; Bankruptcy Creditors' Service, Inc., 215/945-
7000)
MUSICLAND HOLDING: Committee Has Until June 1 to File Claim
-----------------------------------------------------------
Musicland Holding Corp., its debtor-affiliates, the Official
Committee of Unsecured Creditors and the Secured Trade Creditors
stipulate that the Creditors Committee's time to file any claim
against the Secured Trade Creditors under the DIP Order is
extended until June 1, 2006.
The Creditors Committee reserves the right to seek the Court's
permission for examination of the Secured Trade Creditors,
provided that the Informal Committee of Secured Trade Vendors'
rights to object to the examination of its members are reserved.
The Court approved the parties' Stipulation.
Headquartered in New York, New York, Musicland Holding Corp., is
a specialty retailer of music, movies and entertainment-related
products in the United States, Puerto Rico and the Virgin
Islands. The Debtor and 14 of its affiliates filed for chapter
11 protection on Jan. 12, 2006 (Bankr. S.D.N.Y. Lead Case No.
06-10064). James H.M. Sprayregen, Esq., at Kirkland & Ellis,
represents the Debtors in their restructuring efforts. Mark T.
Power, Esq., at Hahn & Hessen LLP, represents the Official
Committee of Unsecured Creditors. When the Debtors filed for
protection from their creditors, they estimated more than US$100
million in assets and debts. (Musicland Bankruptcy News, Issue
No. 11; Bankruptcy Creditors' Service, Inc., 215/945-7000)
=================================
T R I N I D A D & T O B A G O
=================================
BWIA WEST: Jamaican Minister Proposes Merger with Air Jamaica
-------------------------------------------------------------
Senator Anthony Hylton, the minister of foreign affairs and
foreign trade of Jamaica, proposed to merge BWIA West Indies
Airways Limited with Air Jamaica, the Jamaica Observer reports.
Minister Hylton told the gathering at the forum on international
trade issues held at the Fellowship Tabernacle on Half-Way-Tree
Road, "Speaking personally, I believe that the time has come for
us to look at a common transport arrangement, to look at the
possibility of a merger between Air Jamaica and BWIA."
According to the Observer, Minister Hylton asked the private
sector to look at this need for a transportation policy as an
opportunity for their participation, saying that the government
would welcome any initiative from them.
The minister, says the Observer, emphasized the importance of
both global and regional trade and outlined the negotiations the
government was involved in through his ministry.
For Jamaica to become a significant player in global trade, it
would have to embark on a radical transformation of its
productive capacity, Minister Hylton was quoted by the Observer
as saying.
Jamaica's state airline Air Jamaica and BWIA, which is run by
the government of Trinidad and Tobago, have been making
significant losses, the Observer relates.
About BWIA
BWIA was founded in 1940, and for more than 60 years has been
serving the Caribbean islands from Trinidad and Tobago, the hub
of the Americas, linking the twin island republic and many other
Caribbean islands with North America, South America, the United
Kingdom and Europe.
The airline has reportedly been losing US$1 million a week due
to poor operational management. An employee survey revealed
that lack of responsibility by the management is a major issue
in the company. Under the business plan, management will be
downsized to cut the losses.
About Air Jamaica
Air Jamaica -- http://www.airjamaica.com-- was founded in 1969.
It carries passengers and cargo to nearly 30 destinations in the
Caribbean, Europe, and North America. The Jamaican government
assumed full ownership of the airline after an investor group
turned over its 75% stake in late 2004. The government had
owned 25% of the company after it went private in 1994.
* * *
Air Jamaica's US$200 million 9-3/8% notes due July 18, 2015,
carries Moody's B1 rating and Standard & Poor's B rating.
RBTT FINANCIAL: Appoints Suresh Sookoo as Chief Exec. Officer
-------------------------------------------------------------
Peter July, the Group Chairman at RBTT Financial Holdings
Limited, announced the Board's appointment of Suresh Sookoo to
the position of Group Chief Executive Officer of the regional
financial institution.
The Chairman's announcement follows the successful
reorganization of the Group which was led by its Chief Executive
Officer Jerome Sooklal and Chief Operating Officer Suresh
Sookoo.
This now positions RBTT to continue its strategy of regional
diversification and expansion. With the completion of the
reorganization exercise, Mr. Sooklal is leaving RBTT to resume
his international career and in announcing his decision, said,
"I am delighted to hand over the reins of leadership to Suresh
and his new management team."
Mr. July acknowledged and thanked Mr. Sooklal for his
contribution to the Group and in welcoming Mr Sookoo to his new
leadership role, said "I have every confidence in Suresh's
ability to take the Group forward. His knowledge and
understanding of the organisation is unsurpassed."
Mr. Sookoo, who joined RBTT in 1974, has a wealth of experience
in banking and finance. As former Chief Operating Officer, he
was responsible for the development and oversight of the Group's
regional strategy, building the company's franchise as a leading
banking and financial services provider. Mr. Sookoo leads a
committed and experienced management team.
RBTT Financial Holdings Limited is a financial services
conglomerate consisting of 35 subsidiaries and associated
companies located in 12 legal jurisdictions in the Caribbean
region, including 10 licensed commercial banks with 84 branches.
The group's major subsidiaries include RBTT Bank Limited and
RBTT Merchant Bank Limited, a leading regional merchant bank.
* * *
Fitch assigns its BB+ rating on RBTT Financial Holdings
Limited's foreign currency long-term debt. Fitch also places a
B rating on the company's foreign currency short-term debt.
=================
V E N E Z U E L A
=================
CITGO PETROLEUM: Will Sell Six Refineries in United States
----------------------------------------------------------
Citgo Petroleum -- the US refining and marketing arm of
Venezuela's state oil firm Petroleos de Venezuela aka PDVSA --
plans to sell three of the six refineries it owns in the United
States, Felix Rodriguez, the company's head -- told Caracas
daily El Universal.
Mr. Rodriquez admitted to BNamericas, "For a few years Citgo has
been buying gasoline in the market to satisfy contracts with gas
stations and many times it is sold at a loss. In other places
we could make more, that's what the review is about."
Mr. Rodriguez informed BNamericas that Citgo plans to sell two
asphalt-making refineries in Paulsboro, New Jersey and Savannah,
Georgia because asphalt making is not Citgo's business.
Mr. Rodriguez also reiterated to BNamericas plans to sell
Lyondell-Citgo, the Houston refinery that is 41% owned by Citgo
and which processed 230,000b/d of crude from Venezuela in 2005.
The refinery makes losses and operationally, it had many
problems that implied investments beyond those foreseen, Mr.
Rodriguez explained to BNamericas.
According to the Associated Press, industry analysts that said
that Venezuela wants to reduce its economic exposure to the US
government. President Hugo Chavez had announced that Venezuela
is seeking new markets for its crude.
There are better markets for gasoline retailing than the US, Mr.
Rodriguez was quoted by BNamericas as saying.
However, Mr. Rodriguez informed El Universal that the company
will not leave the US market and even promised to invest US$500
million in the remaining facilities.
According to BNamericas, Mr. Rodriguez said Citgo is evaluating
commercial relations with the 14,000 gas stations it banners and
is seeking ways to improve that side of the business.
Mr. Rodriguez also told El Universal that Venezuela plans to
continue selling crude oil to the Lyondell refinery despite
plans to sell its stake in the venture.
The partial sale of the refinery could involve an agreement for
Venezuela to continue supplying the refinery with Venezuelan
crude oil, Mr. Rodriguez explained to the Associated Press.
Mr. Rodriguez informed AP that the company plans to begin
receiving offers for its stake in the refinery in June.
About Citgo
Headquartered in Houston, Texas, CITGO Petroleum Corporation
-- http://www.citgo.com/-- is owned by PDV America, an
indirect, wholly owned subsidiary of Petroleos de Venezuela
S.A., the state-owned oil company of Venezuela.
PDVSA is Venezuela's state oil company in charge of the
development of the petroleum, petrochemical and coal industry,
as well as planning, coordinating, supervising and controlling
the operational activities of its divisions, both in Venezuela
and abroad.
* * *
As reported at the Troubled Company Reporter on Feb. 16, 2006,
Standard and Poor's Ratings Services assigned a 'BB' rating on
CITGO Petroleum Corp.
PETROLEOS DE VENEZUELA: CLP Balks at Accord with Mayors
-------------------------------------------------------
As previously reported, Venezuela, through state-owned firm
Petroloes de Venezuela SA, agreed to deliver oil to Nicaragua
under preferential terms.
Under the oil accord, PDVSA will sell 10 million barrels of oil
annually to Nicaraguan municipalities. PDVSA will receive 60%
of payment within 90 days of shipment, and the remaining 40%
will be paid off over 25 years at 1% interest, including a two-
year grace period.
However, Nicaragua's Constitutionalist Liberal Party disregarded
the agreement signed by PDVSA and Managua Mayor Dionisio
Marenco.
"This agreement is to enrich Sandinist mayors and fund the
electoral campaign of the National Liberation Sandinist Front
(FSLN)," PLC Vice-President Wilfredo Navarro was quoted by El
Universal as saying.
According to Mr. Navarro, 56 liberal mayors will leave the
Nicaraguan Association of Municipalities to signal their
disapproval of the agreement with PDVSA, El Universal relates.
Petroleos de Venezuela SA aka PDVSA is Venezuela's state oil
company in charge of the development of the petroleum,
petrochemical and coal industry, as well as planning,
coordinating, supervising and controlling the operational
activities of its divisions, both in Venezuela and abroad.
* * *
Moody's Investor Service assigned these ratings to Nicaragua:
Rating Rating Date
------ -----------
Long Term Caa1 June 30, 2003
Senior Unsecured
Debt B3 June 30, 2003
* * *
On Jan. 23, 2005, Fitch Ratings upgraded the local and foreign
currency ratings of Petroleos de Venezuela S.A. aka PDVSA to
'BB-' from 'B+'. The rating of PDVSA's export receivable
future flow securitization, PDVSA Finance Ltd, was also upgraded
to 'BB+' from 'BB'. In addition, Fitch has assigned PDVSA a
'AAA(ven)' national scale rating. The Rating Outlook is
Stable. Both rating actions follow Fitch's November 2005
upgrade of Venezuela's sovereign rating.
PETROLEOS DE VENEZUELA: Sells Discounted Oil to Guatemala Towns
---------------------------------------------------------------
The Venezuelan government has agreed to sell economical fuel to
the Guatemalan Commonwealth of Municipalities -- FMMG --
comprised of 13 indigenous town councils, El Universal reports,
citing municipal sources.
"President Hugo Chavez, solidarity with Guatemalan mayoralties,
agreed to execute a convention on energy cooperation for
development," Rocael Cardona, FMMG advisor, told EFE news
agency.
The agreement will be signed in June and will provide fuel "on
very favorable conditions for the country's municipalities," El
Universal relates.
Under the proposed deal, Guatemala will buy 450,000 barrels of
oil per month from Petroleos de Venezuela SA to be distributed
to the 13 towns. 60% of the fuel will be paid upfront, while
the rest will be paid in a 20-year period with an interest rate
of one percent, El Universal relates.
Petroleos de Venezuela SA aka PDVSA is Venezuela's state oil
company in charge of the development of the petroleum,
petrochemical and coal industry, as well as planning,
coordinating, supervising and controlling the operational
activities of its divisions, both in Venezuela and abroad.
* * *
Fitch Ratings assigned these ratings on Guatemala:
Rating Rating Date
------ -----------
Country Ceiling BB+ Feb. 22, 2006
Long Term IDR BB+ Feb. 22, 2006
Short Term IDR B Feb. 22, 2006
Local Currency
Long Term Issuer
Default Rating BB+ Feb. 22, 2006
Fitch also rated Guatemala's senior unsecured bonds:
Maturity Date Amount Rate Ratings
------------- ------ ---- -------
Aug. 3, 2007 $150,000,000 8.5% BB+
Nov. 8, 2011 $325,000,000 10.25% BB+
Aug. 1, 2013 $300,000,000 9.25% BB+
Oct. 6, 2034 $330,000,000 8.125% BB+
* * *
On Jan. 23, 2005, Fitch Ratings upgraded the local and foreign
currency ratings of Petroleos de Venezuela S.A. aka PDVSA to
'BB-' from 'B+'. The rating of PDVSA's export receivable
future flow securitization, PDVSA Finance Ltd, was also upgraded
to 'BB+' from 'BB'. In addition, Fitch has assigned PDVSA a
'AAA(ven)' national scale rating. The Rating Outlook is
Stable. Both rating actions follow Fitch's November 2005
upgrade of Venezuela's sovereign rating.
* VENEZUELA: Chinese Firm Opening Car Assembly Plant in Country
---------------------------------------------------------------
Chinese company, Worldwide Group, will open a car assembly plant
in Venezuela's Falcon state. The firm will import to Venezuela
5,000 buses in the next few weeks, El Universal reports.
The plant is expected to start operating within 18 months,
corporate representatives Hu Jingham and Zhu Baojie said in a
news conference. They however, did not disclose figures
regarding investment, production or job generation, El Universal
relates.
Sources told El Universal the buses are to be sold 40% under
current domestic market prices.
Worldwide Group agents are to meet with officials of the Finance
Ministry, the Caracas Metropolitan Mayoralty, the Terrestrial
Transit National Institute, oil holding Petroleos de Venezuela
SA and Falcon state Governor's Office, among others, El
Universal states.
* * *
Venezuela's foreign currency long-term debt is rated B2 by
Moody's, B+ by Standard & Poor's, and BB- by Fitch.
* VENEZUELA: Will Participate in Trade Fair with Cuba & Bolivia
---------------------------------------------------------------
Venezuela, along with Cuba and Bolivia, will participate in the
International Fair of the southern trade bloc, Bolivarian
Alternative for the Americas aka ALBA, and the People's Trade
Agreement aka TCP, Digital Gramma Internacional reports.
According to Digital Gramma, the fair is framed in the
integration accords covered by the ALBA and the TCP and signed
on April 28, 2006, in Havana by presidents:
-- Evo Morales of Bolivia,
-- Fidel Castro of Cuba, and
-- Hugo Chavez of Venezuela.
The fair will be held from May 25 to May 26 in La Paz, Bolivia,
Digital Gramma relates.
Bolivia's Ministry of Production and Small Businesses is
organizing the event, according to Digital Gramma. The ministry
said that it would serve for the exchange of information on
supply and demand possibilities in Bolivia, Cuba and Venezuela,
as well as in the potentiality of productive sectors.
Prensa Latina states that about 25 firms from Bolivia are
expected to participate. The number of participants from Cuba
and Venezuela is yet undetermined, according to Gustavo Barbery
-- Bolivia's deputy minister of trade and exports.
* * *
Moody's assigned these ratings on Cuba:
-- CC LT Foreign Bank Depst, Caa2
-- CC LT Foreign Curr Debt, Caa1
-- CC ST Foreign Bank Depst, NP
-- CC ST Foreign Curr Debt, NP
-- Issuer Rating, Caa1
* * *
Fitch Ratings assigned these ratings on Bolivia:
Rating Rating Date
------ -----------
Country Ceiling B- Jun. 17, 2004
Long Term IDR B- Dec. 14, 2005
Local Currency
Long Term Issuer
Default Rating B- Dec. 14, 2005
* * *
Venezuela's foreign currency long-term debt is rated B2 by
Moody's, B+ by Standard & Poor's, and BB- by Fitch.
***********
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Copyright 2006. All rights reserved. ISSN 1529-2746.
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