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T R O U B L E D C O M P A N Y R E P O R T E R
L A T I N A M E R I C A
Friday, August 11, 2006, Vol. 7, Issue 159
Headlines
A R G E N T I N A
AVALLONE HNOS: Verification of Proofs of Claim Is Until Sept. 20
CRESTALL SA: Deadline for Verification of Claims Is Oct. 6
DADO SA: Trustee Verifies Proofs of Claim Until Oct. 3
TELEFONICA DE ARGENTINA: Fitch Affirms Low B Issuer Ratings
PANAMERICANA LOGISTIC: Claims Verification Is Until Oct. 12
POWERNET SA: Trustee Verifies Claims Until Oct. 19
REASONS SA: Last Day for Verification of Claims Is on Sept. 26
B A H A M A S
COMPLETE RETREATS: Hires Dechert LLP as Bankruptcy Counsel
COMPLETE RETREATS: Hires XRoads Solutions as Financial Advisor
WINN-DIXIE: Inks Fifth Revision of DIP Financing Credit Accord
WINN-DIXIE: Judge Funk Approves Solicitation Procedures
B A R B A D O S
ANDREW CORP: Mutually Terminates Pending Merger With ADC
ANDREW CORP: Snubs CommScope's US$9.50 Per Share Purchase Offer
B E R M U D A
FOSTER WHEELER: Wins Gas Supply Project in Nigeria
FOSTER WHEELER: Net Income Reaches US$43.1MM in Second Quarter
GLOBAL CROSSING: Reports Second Quarter Revenue of US$456 Mil.
INTELSAT LTD: Offers to Exchange 9-1/4% Senior Discount Notes
QUANTA CAPITAL: Posts US$42.9 Million Net Loss in 2nd Quarter
REFCO INC: Chapter 7 Trustee Wants Court to Confirm Authority
REFCO INC: Files Amended Claimants List on Master Proof Filing
REFCO INC: Customers Want Rule 2004 Examination on Refco F/X
B O L I V I A
INTERNATIONAL PAPER: Sells Unit to CMP Holdings for US$1.4 Bil.
* BOLIVIA: Franklin Mining & YPFB to Form Joint Venture
B R A Z I L
ALERIS INT: Texas Pacific Merger Cues S&P to Watch Ratings
AMPLA ENERGIA: S&P Affirms BB- Corporate Credit Rating
BANCO NACIONAL: Approves BRL66.1 Mil. Financing to MRC Servicos
BANCO NACIONAL: Renews Agreement With Grande ABC Dev't Agency
BLOUNT INT'L: Sells Dixon Assets to Husqvarna for US$34 Million
BV FINANCIERA: Moody's LatAm Rates Class B Shares at (P) Caa1
COMPANHIA ENERGETICA: First Semester Net Income Reaches BRL665MM
COMPANHIA SIDERURGICA: Ratings Unaffected by New Investments
COMVERSE TECHNOLOGY: Wants Until Sept. 25 to File Fin'l Report
TAM SA: S&P Assigns BB Long-Term Corporate Credit Rating
C A Y M A N I S L A N D S
ASAKUSA: Creditors Have Until Sept. 7 to File Proofs of Claim
BRIDGE INVESTMENT: Last Day to File Proofs of Claim Is Sept. 7
CITRIX CAYMAN: Last Day for Proofs of Claim Filing Is on Sept. 7
DOLMEN LIMITED: Proofs of Claim Must be Submitted by Sept. 7
ELECTROGUAYAS INC: Proofs of Claim Must be Filed by Sept. 7
LION1 LDC: Creditors Have Until Sept. 7 to File Proofs of Claim
LION2 LDC: Deadline for Filing Proofs of Claim Is on Sept. 7
LION3 LDC: Creditors Must File Proofs of Claim by Sept. 7
LION4 LDC: Last Day to File Proofs of Claim Is Sept. 7
LION5 LDC: Creditors Must Present Proofs of Claim by Sept. 7
NEWBRIDGE LIMITED: Proofs of Claim Must be Filed by Sept. 7
NIELVAL LIMITED: Holding Final Shareholders Meeting on Aug. 29
ORACLE DELTA: Schedules Final Shareholders Meeting on Aug. 28
QUICK ACCESS: Proofs of Claim Filing Deadline Is Set for Sept. 7
SHACKLETON RE: AM Best Rates US$125MM Variable Notes at B+
SHACKLETON RE: AM Best Assigns Low B Ratings on US$110MM Notes
ZEST INVESTMENT: Filing of Proofs of Claim Is Until Sept. 7
C H I L E
ARAMARK CORP: Sales Up 5% to US$2.93 Bil. in Third Quarter 2006
MILLIPORE CORP: Earns US$29.1 Million in Quarter Ended July 1
SHAW GROUP: Secures US$250MM Tech Assistance Contract from FEMA
C O L O M B I A
DIGICEL LTD: Qualifies to Bid for Ola Stake
MILLICOM INTERNATONAL: Qualifies to Bid for Ola Stake
C O S T A R I C A
BANCO BANEX: Posts CRC4.25 Billion First Half 2006 Profits
C U B A
* CUBA: Inks Cooperation Accord with Uruguay
D O M I N I C A N R E P U B L I C
BANCO INTERCONTINENTAL: Lois Malkun Defends Former President
FALCONBRIDGE LTD: Meets Conditions on Offer to Acquire Novicourt
FALCONBRIDGE LTD: To Make Major Investment in Raglan Nickel Mine
E C U A D O R
* ECUADOR: Strengthens Economic Ties with Chile
E L S A L V A D O R
CHOICE HOTELS: June 30 Balance Sheet Upside-Down by US$118 Mil.
* EL SALVADOR: Good Market Condition Cues S&P to Affirm Ratings
G U A T E M A L A
PERKINELMER INC: Earns US$35.7 Million in Quarter Ended July 2
PERKINELMER INC: Board Declares US$0.07 Per Share Dividend
G U Y A N A
DIGICEL LTD: Rejects Accusations of Stealing Info from Celstar
H O N D U R A S
* HONDURAS: President May Allow Mining Ban, Says Bishop
J A M A I C A
CENTURY ALUMINUM: Earns US$45.8 Mil. in Second Quarter of 2006
KAISER ALUMINUM: Salaried VEBA Trust Discloses 44% Equity Stake
M E X I C O
AXTEL SA: Launches Operations in Irapuato, Guanajuato
BALLY TOTAL: Names Ronald G. Eidell as Senior VP and CFO
CELESTICA: Incurs US$30.3 Mil. Net Loss in Quarter Ended June 30
CINEMARK USA: Revenues Up 16.6% for Quarter Ended June 30
MERIDIAN AUTOMOTIVE: Files Conformed Version of Revised 3rd Plan
MERIDIAN AUTOMOTIVE: Seeks Sept. 30 Plan-Filing Period Extension
P A N A M A
* PANAMA: Will Invest US$142 Million in Infrastructure Works
* PANAMA: Will Strengthen Bilateral Ties with European Union
P E R U
BIO-RAD LAB: Generates US$317.7 Million Second Quarter Revenues
PETROLEO BRASILEIRO: To Expand Business Operations in Peru
P U E R T O R I C O
DRESSER: Seeks Lenders' Consent on Reporting Filing Extension
KMART CORP: Court Okays Pact Allowing McKellar to Pursue Claim
KMART CORP: S. Henderson Can Proceed with Personal Injury Suit
MUSICLAND HOLDING: Inks Stipulation with Verizon on Service Pact
MUSICLAND HOLDING: Paul Weiss Hired as Trade Vendors Panel Atty.
T R I N I D A D & T O B A G O
MIRANT: MC Asset Recovery Wants San Francisco's Claim Junked
MIRANT CORP: To Auction Various US Gas-Fired Assets
MIRANT CORP: Net Income Reaches US$99MM in Second Quarter 2006
U R U G U A Y
BANCO ITAU: To Acquire BankBoston Operations in Chile & Uruguay
* URUGUAY: Inks Accord with Cuba's Chamber of Commerce
V E N E Z U E L A
CITGO: Faces Charges on Violations of Environmental Regulation
ELECTRICIDAD DE CARACAS: Increases Capital by 5% in 2006
ELECTRICIDAD DE CARACAS: Will Allocate VEB72 Billion to Pay Debt
* Upcoming Meetings, Conferences and Seminars
- - - - -
=================
A R G E N T I N A
=================
AVALLONE HNOS: Verification of Proofs of Claim Is Until Sept. 20
----------------------------------------------------------------
Sandra Boueri, the court-appointed trustee for Avallone Hnos.
S.R.L.'s bankruptcy proceeding, verifies creditors' proofs of
claim until Sept. 20, 2006.
Ms. Boueri will present the validated claims in court as
individual reports on Nov. 2, 2006. A court in Mendoza will
determine if the verified claims are admissible, taking into
account the trustee's opinion and the objections and challenges
raised by Avallone Hnos. and its creditors.
Inadmissible claims may be subject for appeal in a separate
proceeding known as an appeal for reversal.
A general report that contains an audit of Avallone's accounting
and banking records will follow on Dec. 15, 2006.
Ms. Boueri is also in charge of administering Avallone's assets
under court supervision and will take part in their disposal to
the extent established by law.
The trustee can be reached at:
Sandra Boeuri
Alem 25, Ciudad de Mendoza
Mendoza, Argentina
CRESTALL SA: Deadline for Verification of Claims Is Oct. 6
----------------------------------------------------------
Alicia Victorero, the court-appointed trustee for Crestall
S.A.'s bankruptcy case, verifies creditors' proofs of claim
until Oct. 6, 2006.
Under Argentine Bankruptcy Law, Ms. Victorero is required to
present the validated claims in court as individual reports.
Court No. 5 in Buenos Aires will determine if the verified
claims are admissible, taking into account the trustee's opinion
and the objections and challenges raised by Crestall and its
creditors.
Inadmissible claims may be subject for appeal in a separate
proceeding known as an appeal for reversal.
Ms. Victorero will also submit a general report that contains an
audit of Crestall's accounting and banking records. The report
submission dates have not been disclosed.
Crestall was declared bankrupt at the request of Maria Magdalena
Rodriguez Priore, whom it owes US$1,142.50.
Clerk NO. 10 assists the court in the proceeding.
The debtor can be reached at:
Crestall S.A.
Vicente Lopez 1762
Buenos Aires, Argentina
The trustee can be reached at:
Alicia Victorero
Vicente Lopez 1762
Buenos Aires, Argentina
DADO SA: Trustee Verifies Proofs of Claim Until Oct. 3
------------------------------------------------------
Susana Marino, the court-appointed trustee for Dado S.A.'s
bankruptcy case, verifies creditors' proofs of claim until
Oct. 3, 2006.
Under Argentine Bankruptcy Law, Ms. Marino is required to
present the validated claims in court as individual reports.
Court No. 2 in Buenos Aires will determine if the verified
claims are admissible, taking into account the trustee's opinion
and the objections and challenges raised by Dado and its
creditors.
Inadmissible claims may be subject for appeal in a separate
proceeding known as an appeal for reversal.
Ms. Marino will also submit a general report that contains an
audit of Dado's accounting and banking records. The report
submission dates have not been disclosed.
Dado S.A. was declared bankrupt at the behest of its creditor
Banco Finansur.
Clerk No. 3 assists the court in the case.
The debtor can be reached at:
Dado S.A.
Suipacha 370
Buenos Aires, Argentina
The trustee can be reached at:
Susana Marino
Uruguay 560
Buenos Aires, Argentina
TELEFONICA DE ARGENTINA: Fitch Affirms Low B Issuer Ratings
-----------------------------------------------------------
Fitch affirms Telefonica de Argentina S.A. aka TASA after the
announcement to reduce its capital by approximately ARS1.048
billion, as:
-- Foreign currency Issuer Default Rating: 'B+';
-- Local currency IDR: 'BB-'; and
-- National scale rating 'A+(arg)'.
The Ratings Outlook is Stable. On Aug. 2, 2006, Fitch upgraded
TASA's foreign currency IDR to 'B+' from 'B' as a consequence of
the August 1 upgrades of the Argentine Republic long-term local
currency IDR to 'B' from 'B-'and the Country Ceiling to 'B+'
from 'B'.
Telefonica de Argentina credit quality and credit metrics
continues to be consistent with the rating category considering
the proposed equity reduction. The ARS.048 billion capital
reduction is expected to be a one time event as part of its
strategy to rearrange its capital structure. This reduction
should be financed mainly with cash balances, plus additional
short-term debt in the range of approximately ARS250-300
million. The additional debt would slightly increase the
company's leverage, returning to current levels over the short
term as a result of the company's solid cash generation.
TASA ratings are supported by its improved financial profile,
strong business position in the Argentine telecom sector with an
estimated fixed-line local-service market share of 53.5%, solid
peso-denominated cash flow generation and a manageable debt
maturity profile. The ratings also incorporate a level of
implicit support from controlling shareholder Telefonica S.A. of
Spain, which has provided flexibility in the form of
intercompany loans. The ratings also reflect a continuing
exposure to foreign currency fluctuations, because most of
TASA's revenues are peso denominated while its debt is largely
foreign currency denominated. In addition, the company faces
regulatory risk and increased competition from wireless
services.
The company has reduced its debt levels over the past few years
with internally generated cash flow to ARS2.7 billion as of
March 31, 2006 from a peak of over ARS6 billion in 2002. For
the last twelve months ended March 31, 2006, credit protection
measures of total debt to EBITDA and EBITDA to interest expense
were 1.5x and 5.9x, respectively. Considering a maximum
additional indebtedness of ARS250-300 million for the equity
reduction, proforma total debt to EBITDA may increase to 1.7x,
which is consistent with the rating category.
TASA is the incumbent local exchange carrier in the southern
region of Argentina providing local service, long distance,
broadband services and dial up Internet access with revenues and
EBITDA during 2005 of approximately USD$1.149 billion and
USD$592 million, respectively. Telefonica S.A. of Spain
controls, either directly or indirectly, 98% of TASA.
PANAMERICANA LOGISTIC: Claims Verification Is Until Oct. 12
-----------------------------------------------------------
Ernesto Garcia, the court-appointed trustee for Panamerican
Logistic S.A.'s reorganization proceeding, verifies creditors'
proofs of claim until Oct. 12, 2006.
Under Argentine Bankruptcy Law, Mr. Garcia is required to
present the validated claims in court as individual reports.
Court No. 5 in Buenos Aires will determine if the verified
claims are admissible, taking into account the trustee's opinion
and the objections and challenges raised by Panamericana
Logistic and its creditors.
Inadmissible claims may be subject for appeal in a separate
proceeding known as an appeal for reversal.
Mr. Garcia will also submit a general report that contains an
audit of Panamericana Logistic's accounting and banking records.
The report submission dates have not been disclosed.
On Aug. 8, 2007, Panamericana Logistic's creditors will vote on
a settlement plan that the company will lay on the table.
Clerk No. 9 assists the court in the proceeding.
The debtor can be reached at:
Panamericana Logistic S.A.
Montevideo 451
Buenos Aires, Argentina
The trustee can be reached at:
Ernesto Garcia
Sarmiento 1587
Buenos Aires, Argentina
POWERNET SA: Trustee Verifies Claims Until Oct. 19
--------------------------------------------------
Alfredo Marikia, the court-appointed trustee for Powernet S.A.'s
bankruptcy proceeding, verifies creditors' proofs of claim until
Oct. 19, 2006.
Under Argentine Bankruptcy Law, Mr. Marikia is required to
present the validated claims in court as individual reports.
Court No. 7 in Buenos Aires will determine if the verified
claims are admissible, taking into account the trustee's opinion
and the objections and challenges raised by Powernet and its
creditors.
Inadmissible claims may be subject for appeal in a separate
proceeding known as an appeal for reversal.
Mr. Marikia will also submit a general report that contains an
audit of Powernet's accounting and banking records. The report
submission dates have not been disclosed.
Powernet was declared bankrupt at the behest of Met Steccom
S.C.A., which it owes US$21,225.29.
Clerk No. 13 assists the court in the case.
The debtor can be reached at:
Powernet S.A.
Avenida Corrientes 2548
Buenos Aires, Argentina
The trustee can be reached at:
Alfredo Marikia
Avenida Cordoba 1247
Buenos Aires, Argentina
REASONS SA: Last Day for Verification of Claims Is on Sept. 26
--------------------------------------------------------------
Abraham Gutt, the court-appointed trustee for Reasons S.A.'s
bankruptcy case, verifies creditors' proofs of claim until
Sept. 26, 2006.
Under Argentine Bankruptcy Law, Mr. Gutt is required to present
the validated claims in court as individual reports. Court No.
4 in Buenos Aires will determine if the verified claims are
admissible, taking into account the trustee's opinion and the
objections and challenges raised by Reasons and its creditors.
Inadmissible claims may be subject for appeal in a separate
proceeding known as an appeal for reversal.
Mr. Gutt will also submit a general report that contains an
audit of Reasons' accounting and banking records. The report
submission dates have not been disclosed.
Court No. 4 declared Reasons bankrupt at the behest of Gabriela
Bezzi, whom it owes US$5,404.91.
Clerk No. 7 assists the court in the case.
The debtor can be reached at:
Reasons S.A.
Sarmiento 663
Buenos Aires, Argentina
The trustee can be reached at:
Abraham Gutt
Tucuman 1711
Buenos Aires, Argentina
=============
B A H A M A S
=============
COMPLETE RETREATS: Hires Dechert LLP as Bankruptcy Counsel
----------------------------------------------------------
On an interim basis, the U.S. Bankruptcy Court for the District
of Connecticut gave Complete Retreats LLC and its debtor-
affiliates permission to employ Dechert LLP as their bankruptcy
and restructuring attorneys.
As reported in the Troubled Company Reporter on Aug. 2, 2006,
Dechert is expected to:
(a) provide legal advice with respect to the Debtors' powers
and duties as debtors-in-possession in the continued
operation of their business and management of their
properties;
(b) take all necessary actions to protect and preserve the
Debtors' estates;
(c) prepare all necessary motions, applications, answers,
proposed orders, reports, and other papers in connection
with the administration of the Debtors' estates;
(d) negotiate and draft any agreements for the provision of
financing to the Debtors;
(e) negotiate and draft any agreements for the sale or
purchase of any assets of the Debtors, if appropriate;
(f) negotiate and draft a plan of reorganization and all
other related documents;
(g) take all steps necessary to confirm and implement a plan
of reorganization; and
(h) perform all other necessary and appropriate legal
services in connection with the prosecution of the
bankruptcy cases.
Dechert will charge the Debtors on an hourly basis in accordance
with its ordinary and customary rates:
Attorneys US$250 to US$825 per hour
Paralegals US$145 to US$220 per hour
Joel H. Levitin, Esq., a partner at Dechert LLP, assured the
Court that his firm is competent to represent the interests of
the Debtors, and has not and will not represent any shareholder,
director, officer, lender, creditor, or equity holder of the
Debtors in any matter related to the bankruptcy cases.
Dechert does not represent any interest adverse to the estates
of the Debtors, their creditors, or any other parties-in-
interest, Mr. Levitin attested.
Mr. Levitin further assured the Court that Dechert is a
"disinterested person," as referenced in Section 327 of the
Bankruptcy Code and as defined in Sections 101(14) and 1107(b)
of the Bankruptcy Code.
About Complete Retreats
Complete Retreats, LLC, Preferred Retreats, LLC, and their
subsidiaries were founded in 1998. Owned by Robert McGrath and
four minority owners, the companies operate a five-star
hospitality and real estate management business and are a
pioneer and market leader of the "destination club" industry.
Under the trade name "Tanner & Haley Resorts," Complete
Retreats, et al.'s destination clubs have numerous individual
and company members.
Destination club members pay up-front membership deposits,
annual dues, and daily usage fees. In return, members and their
guests enjoy the use of first-class private residences, and
receive an array of luxurious services and amenities in certain
exotic vacation destinations in the United States and locations
around the world, including: Abaco, Bahamas; Cabo San Lucas,
Mexico; Nevis, West Indies; Telluride, Colorado; and Jackson
Hole, Wyoming.
Complete Retreats and its debtor-affiliates filed for chapter 11
protection on July 23, 2006 (Bankr. D. Conn. Case No. 06-50245
through 06-50306). Nicholas H. Mancuso, Esq., Jeffrey K. Daman,
Esq., Joel H. Levitin, Esq., David C. McGrail, Esq., Richard A.
Stieglitz Jr., Esq., at Dechert LLP, are representing the
Debtors in their restructuring efforts. Xroads Solutions Group,
LLC, is the Debtors financial and restructuring advisor. When
the Debtors filed for chapter 11 protection, they listed total
debts of US$308,000,000. (Complete Retreats Bankruptcy News,
Issue No. 3; Bankruptcy Creditors' Service, Inc., 215/945-7000).
COMPLETE RETREATS: Hires XRoads Solutions as Financial Advisor
--------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Connecticut gave
Complete Retreats LLC and its debtor-affiliates authority, on an
interim basis, to employ XRoads Solutions Group LLC as their
financial and restructuring advisor.
As reported in the Troubled Company Reporter on Aug. 2, 2006,
in late June 2006, the Debtors hired XRoads Solutions to assist
them in the management of their business and in the exploration
of strategic alternatives.
In a retention letter dated July 20, 2006, the Debtors proposed
to continue XRoads' employment as their financial and
restructuring advisor.
Pursuant to the Retention Letter, XRoads will continue to:
(a) provide the services of Ms. Etlin, as well as other
supporting personnel;
(b) develop, refine, implement, and monitor the Debtors'
turnaround efforts;
(c) evaluate the Debtors' strategic alternatives;
(d) assist in implementing any approved capital structure;
(e) review, assess and develop action plans of key
contracts;
(f) review and validate the Debtors' cash flow forecasts and
related processes;
(g) evaluate the Debtors' business plan;
(h) assist in the development and implementation of a
recapitalization plan;
(i) provide financial information in support of, and
participation in, the Debtors' investment banking
process;
(j) assist in communications with, negotiations with, and
presentations to vendors, creditors, and other key
constituents of the Debtors;
(k) assist in the development of employee-related plans;
(l) assume the leadership role for the design and
implementation of new effective management and financial
reporting methodologies for the Debtors' business; and
(m) analyze and lead the Debtors' cash management and
related activities.
In addition, XRoads Case Management Services, LLC, an affiliate
of XRoads, will provide bankruptcy case support, administrative
and noticing services to the Debtors.
XRoads will charge the Debtors a fixed minimum fee of US$150,000
per month, provided that if their services total more than 480
hours, the Debtors will pay XRoads US$375 per excess hour.
If any Restructurings are consummated during the term of their
engagement and 12 months after the termination of their
services, XRoads will receive a transaction fee equal to:
(a) 0.5% of the first US$100,000,000 in cumulative face
value of the Debtors' debt securities or other
indebtedness, obligations, or liabilities restructured;
and
(b) 0.25% of all amounts in excess of US$100,000,000 in face
value of the Debtors' cumulative debt securities or
other indebtedness, obligations, or liabilities
restructured.
If any Sale Transactions are consummated during the term of
their engagement and 12 months after the termination of their
services, XRoads will receive a performance fee equal to:
(a) 0.5% of the first US$100,000,000 of Aggregate Gross
Consideration paid; and
(b) 0.25% of the Aggregate Gross Consideration paid in
excess of US$100,000,000.
Holly Felder Etlin, a principal at XRoads, assured the Court
that XRoads has not been retained to assist any entity or person
other than the Debtors on matters relating to the bankruptcy
proceedings.
XRoads is disinterested, as defined in Section 101(14) of the
Bankruptcy Code, and does not hold or represent an interest
adverse to the Debtors or their estates, Ms. Etlin affirmed.
About Complete Retreats
Complete Retreats, LLC, Preferred Retreats, LLC, and their
subsidiaries were founded in 1998. Owned by Robert McGrath and
four minority owners, the companies operate a five-star
hospitality and real estate management business and are a
pioneer and market leader of the "destination club" industry.
Under the trade name "Tanner & Haley Resorts," Complete
Retreats, et al.'s destination clubs have numerous individual
and company members.
Destination club members pay up-front membership deposits,
annual dues, and daily usage fees. In return, members and their
guests enjoy the use of first-class private residences, and
receive an array of luxurious services and amenities in certain
exotic vacation destinations in the United States and locations
around the world, including: Abaco, Bahamas; Cabo San Lucas,
Mexico; Nevis, West Indies; Telluride, Colorado; and Jackson
Hole, Wyoming.
Complete Retreats and its debtor-affiliates filed for chapter 11
protection on July 23, 2006 (Bankr. D. Conn. Case No. 06-50245
through 06-50306). Nicholas H. Mancuso, Esq., Jeffrey K. Daman,
Esq., Joel H. Levitin, Esq., David C. McGrail, Esq., Richard A.
Stieglitz Jr., Esq., at Dechert LLP, are representing the
Debtors in their restructuring efforts. Xroads Solutions Group,
LLC, is the Debtors financial and restructuring advisor. When
the Debtors filed for chapter 11 protection, they listed total
debts of US$308,000,000. (Complete Retreats Bankruptcy News,
Issue No. 3; Bankruptcy Creditors' Service, Inc., 215/945-7000).
WINN-DIXIE: Inks Fifth Revision of DIP Financing Credit Accord
--------------------------------------------------------------
The fifth revision of the credit agreement between Winn-Dixie
Stores, Inc., its debtor-affiliates and certain lenders led by
Wachovia Bank, National Association, took effect Aug. 1, 2006,
Winn-Dixie Stores, Inc., says in a regulatory filing with the
U.S. Securities and Exchange Commission.
The parties amended, among others, the definition of "Excess
Availability" to include certain cash deposits. The definition
of insurance is also modified to coincide with the current
policy terms. In addition, Wachovia is allowed an unsecured
interest related to the bank's automated clearinghouse transfer
exposure as it relates to Winn-Dixie's banking transactions.
As of Aug. 2, 2006, no default under the credit agreement exists
or has occurred.
A full-text copy of the Fifth Amendment to the Wachovia Credit
Agreement is available at no charge at:
http://ResearchArchives.com/t/s?f26
Other members of the DIP lending syndicate pursuant to the Fifth
Amendment to the Credit Agreement are:
* General Electric Capital Corporation, as Syndication
Agent and Lender;
* The CIT Group/Business Credit, Inc., as Syndication Agent
and Lender;
* Bank of America, NA, as Documentation Agent and Lender;
* Merrill Lynch Capital, as Documentation Agent and Lender;
* GMAC Commercial Finance LLC, as Documentation Agent and
Lender;
* Wells Fargo Foothill, LLC, as Documentation Agent and
Lender;
* LaSalle Retail Finance;
* Westernbank Puerto Rico;
* National City Business Credit, Inc.;
* UBS AG, Stamford Branch;
* PNC Bank, National Association;
* State of California Public Employees' Retirement System;
* AmSouth Bank;
* Webster Business Credit Corp.;
* Israel Discount Bank of New York;
* Marathon Structured Finance Fund, L.P.;
* RZB Finance LLC;
* Sovereign Bank;
* Erste Bank;
* Azure Funding;
* Senior Debt Portfolio;
* Grayson & Co.; and
* Eaton Vance Institutional Senior Loan Fund
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. 48; Bankruptcy Creditors' Service, Inc., 215/945-
7000).
WINN-DIXIE: Judge Funk Approves Solicitation Procedures
-------------------------------------------------------
The Honorable Jerry A. Funk of the U.S. Bankruptcy Court for the
Middle District of Florida approves Winn-Dixie Stores, Inc., and
its debtor-affiliates' proposed solicitation procedures,
including all the solicitation materials, and authorizes Logan &
Company, Inc., to serve as the Debtors' solicitation and
noticing agent.
The Court sets Aug. 1, 2006, as the record date for determining
the holders of claims and interests entitled to receive
solicitation or noticing materials.
Judge Funk directs all voting parties to submit their ballots to
Logan & Co. by Sept. 25, 2006, at 4:00 p.m. (Eastern Time).
The Debtors may extend the Voting Deadline, in consultation with
the Official Committee of Unsecured Creditors, by filing notice
of extensions with the Court and by serving a copy to Logan &
Co.
Judge Funk notes that only the Debtors' and Creditors
Committee's solicitation letters are authorized for inclusion in
the solicitation materials.
Creditors entitled to vote on the Plan are:
-- holders of claims classified within Classes 7 to 17; and
-- participants in the Debtors' management security plan,
senior corporate officer's management security plan, or
supplemental retirement plan who have filed proofs of
claim.
Holders of Claims in Classes 10 to 17 whose claims are partly
contingent, unliquidated, untimely or disputed will not be
permitted to cast a provisional vote unless they file a motion
under Rule 3018(a) of the Federal Rules of Bankruptcy Procedure.
Judge Funk directs holders of Disputed Claims to file their
Rule 3018 Motions with the Court and serve upon the Debtors'
counsel, Creditors Committee's counsel and Logan & Co. before
Sept. 18, 2006, at 4:00 p.m. (Eastern Time).
Parties to executory contracts or unexpired leases that have not
yet been assumed or rejected, but if rejected would give rise to
rejection damage claims, are permitted to cast a contingent
vote. The contingent votes will be counted only if a motion to
reject the contract or lease is filed before the Confirmation
Hearing and if the Parties:
(a) deliver to Logan & Co. a written request for a special
ballot to vote a contingent rejection damage claim by
Sept. 25, 2006; and
(b) properly complete and return the special ballot on or
before the Voting Deadline.
With respect to potential holders of Landlord Claims in Class
12, Vendor/Supplier Claims in Class 14, Retirement Plan Claims
in Class 15, and other Unsecured Claims in Class 16, the plan
class identified on the ballot or claim reduction form they will
receive will be binding unless they file with the Court a motion
seeking a determination of the proper Class before
Sept. 18, 2006.
Judge Funk directs all known record holders of Winn-Dixie debt
and securities to provide Logan & Co. with the addresses of the
beneficial holders in electronic format no later than
Aug. 6, 2006. Logan & Co. will send solicitation packages to
Noteholder Claimants in Class 12 and notices of deemed rejecting
status to holders of Winn-Dixie common stock interests in Class
21 before Aug. 15, 2006.
Judge Funk instructs Logan & Co. to maintain the confidentiality
of social security numbers provided on the return ballots by
redacting the numbers before making a copy of any ballot
available to a third party.
The Court waives the requirements of Local Rule 3071-1(b) and
agrees that the terms of the Plan and Confirmation Order will
govern the establishment of a bar date for filing administrative
claims.
Judge Funk will convene a hearing on Oct. 13, 2006, at 9:00
a.m. (Eastern Time) to consider confirmation of the Joint Plan
of Reorganization. The deadline for filing objections to
confirmation of the Plan is Sept. 25, 2006 at 4:00 p.m.
(Eastern Time).
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. 48; Bankruptcy Creditors' Service, Inc., 215/945-
7000).
===============
B A R B A D O S
===============
ANDREW CORP: Mutually Terminates Pending Merger With ADC
--------------------------------------------------------
Andrew Corp. and ADC Telecommunications Inc. have entered into
an agreement to terminate their pact and plan of merger, which
the parties entered into on May 30, 2006.
The companies believe that current market considerations raised
significant questions about the ability to obtain necessary
shareholder approval. Therefore, Andrew and ADC have agreed to
terminate the merger agreement without liability to either
party. To effect the mutual termination, Andrew has agreed to
pay ADC US$10 million. In addition, Andrew has agreed that ADC
would be paid another US$65 million in the event Andrew effects
a business combination transaction within 12 months.
"While we believed in the strategic rationale of this
combination and are disappointed that the merits of the
transaction were unrecognized in the marketplace, we will
continue to execute on our strategy to become the leading
supplier of network infrastructure solutions to our customers
worldwide," stated Robert E. Switz, president and CEO of ADC.
"We will accomplish that goal through a combination of business
development initiatives, new product development and execution
in our core business. The fundamentals of our business remain
solid, and we remain confident that we can deliver long-term
growth and profitability."
"Andrew's industry-leading product portfolio and globally
diversified customer base provide the company with a unique
ability to meet the long-term global demand trends for wireless
infrastructure. Andrew remains in a strong position to offer
industry-leading support to operators, OEMs, and other
communications providers around the world. As evidenced by our
record sales and orders in our fiscal third quarter, we are
growing share and improving operations through innovative
products and the hard work of our global team. Our management
team and employees are committed to delivering results and
capitalizing on business opportunities that will drive future
operational and financial improvements. We are confident in the
outlook for our future," Mr. Switz concluded.
About ADC
ADC Telecommunications Inc., -- http://www.adc.com/-- provides
the connections for wireline, wireless, cable, broadcast, and
enterprise networks around the world. ADC has sales into more
than 140 countries.
About Andrew
Headquartered in Westchester, Illinois, Andrew Corporation
(NASDAQ: ANDW) -- http://www.andrew.com/-- designs,
manufactures and delivers innovative and essential equipment and
solutions for the global communications infrastructure market.
The company serves operators and original equipment
manufacturers from facilities in 35 countries including, among
others, these Latin American countries: Argentina, Bahamas,
Belize, Barbados and Bermuda. Andrew is an S&P 500 company
Founded in 1937.
* * *
Standard & Poor's Ratings Services retained on Aug. 7, 2006, its
'BB' ratings on Westchester, Illinois-based Andrew Corp. remain
on CreditWatch, where they were placed with positive
implications on May 31, 2006; the implications are revised to
developing from positive.
The revision reflects an unsolicited offer by CommScope Inc. to
acquire Andrew for approximately US$1.5 billion cash to Andrew's
shareholders, which represents a US$400 million premium to the
current equity value of Eden Prairie, Minnesotta-based ADC
Telecommunications Inc.'s shares. Additionally, CommScope would
assume Andrew's debt. ADC had initially agreed to merge with
Andrew on a stock-for-stock transaction on May 31, 2006.
ANDREW CORP: Snubs CommScope's US$9.50 Per Share Purchase Offer
---------------------------------------------------------------
Andrew Corp.'s Board of Directors has unanimously voted to
reject the unsolicited proposal from CommScope, Inc., to acquire
the company for US$9.50 per share in cash. After a thorough
review, the board, in consultation with its advisors, concluded
that CommScope's proposal is wholly inadequate and not in the
best interests of its shareholders.
"The board carefully reviewed and considered CommScope's
proposal and found it does not adequately reflect the value of
Andrew, its business prospects, and its industry-leading
products, global customer base, and skilled global workforce,"
said Ralph Faison, president and chief executive officer, Andrew
Corp.
"Andrew's industry-leading product portfolio and globally
diversified customer base provide the company with a unique
ability to meet the long-term global demand trends for wireless
infrastructure. Andrew remains in a strong position to offer
industry-leading support to operators, OEMs, and other
communications providers around the world. As evidenced by our
record sales and orders in our fiscal third quarter, we are
growing share and improving operations through innovative
products and the hard work of our global team. Our management
team and employees are committed to delivering results and
capitalizing on business opportunities that will drive future
operational and financial improvements. We are confident in the
outlook for our future."
About Andrew
Headquartered in Westchester, Illinois, Andrew Corporation
(NASDAQ: ANDW) -- http://www.andrew.com/-- designs,
manufactures and delivers innovative and essential equipment and
solutions for the global communications infrastructure market.
The company serves operators and original equipment
manufacturers from facilities in 35 countries including, among
others, these Latin American countries: Argentina, Bahamas,
Belize, Barbados and Bermuda. Andrew is an S&P 500 company
Founded in 1937.
* * *
Standard & Poor's Ratings Services retained on Aug. 7, 2006, its
'BB' ratings on Westchester, Illinois-based Andrew Corp. remain
on CreditWatch, where they were placed with positive
implications on May 31, 2006; the implications are revised to
developing from positive.
The revision reflects an unsolicited offer by CommScope Inc. to
acquire Andrew for approximately US$1.5 billion cash to Andrew's
shareholders, which represents a US$400 million premium to the
current equity value of Eden Prairie, Minnesotta-based ADC
Telecommunications Inc.'s shares. Additionally, CommScope would
assume Andrew's debt. ADC had initially agreed to merge with
Andrew on a stock-for-stock transaction on May 31, 2006.
=============
B E R M U D A
=============
FOSTER WHEELER: Wins Gas Supply Project in Nigeria
--------------------------------------------------
Foster Wheeler Ltd. reported that two of its Global
Engineering and Construction Group, Foster Wheeler Energy
Limited and Foster Wheeler (Nigeria) Limited, in a joint venture
with National Engineering & Technical Company Limited, have been
awarded the front-end engineering design by Chevron Nigeria
Limited for the non-associated gas wellhead platforms and
pipelines portion of CNL's Olokola Gas Supply Project. CNL is a
joint venture partner of the Nigerian National Petroleum
Corporation. NETCO is a wholly owned subsidiary of NNPC.
The contract, to be executed in Nigeria, is the first work
authorization received from CNL under the existing Foster
Wheeler/NETCO three-year term services contract with CNL, which
was announced at the end of last year. The value of the
contract, which will be included in the company's second-quarter
2006 bookings, was not disclosed.
"Foster Wheeler is delighted to strengthen its commitment in
Nigeria through this award," said Anita Omoile, director of
Foster Wheeler (Nigeria) Limited. "The upstream oil and gas
sector is a strategically important market for Foster Wheeler
and is one in which we have a long and successful track record.
We are committed to working very closely with CNL and with NETCO
to deliver a high quality FEED which fully meets the project's
objectives."
The OKGS project is located offshore Nigeria and will provide
2,300 million standard cubic feet per day of natural gas and
associated liquids to the proposed Olokola LNG liquefaction
plant. The new facilities are located approximately 10 to 40
kilometers offshore and will include one 15,000 ton topsides
production platform, one 14,000 ton topsides production
platform, two living quarters platforms, each to accommodate
approximately 60 people, nine wellhead platforms, flares,
bridges and approximately 400 miles of sub-sea pipelines for
gathering and delivering the gas to shore.
The Foster Wheeler/NETCO team will execute the FEED, scheduled
to be completed by the end of 2006, for the nine wellhead
platforms and the pipelines.
"This is an important project for us, especially from the
standpoint of developing local capacity and competence through
the promotion of alliances between local engineering companies
and their foreign counterparts. We are confident that Foster
Wheeler and NETCO will deliver on time and within budget,"
commented Fred Nelson, chairman and managing director of Chevron
Nigeria Limited.
Headquartered in Hamilton, Bermuda, Foster Wheeler Ltd. --
http://www.fwc.com/-- offers 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.
* * *
As reported in the Troubled Company Reporter on Aug 7, 2006,
Standard & Poor's Ratings Services assigned its 'BB-' bank loan
rating and '1' recovery rating on Foster Wheeler Ltd.'s proposed
five-year, US$350 million senior secured credit facilities due
2011, reflecting a high expectation of full recovery of
principal (100%) in the event of a payment default.
As reported in the Troubled Company Reporter on May 30, 2006,
Moody's Investors Service upgraded Foster Wheeler's corporate
family rating to B1 from B3 and assigned a Ba3 rating to the
Company's US$250 million senior secured bank revolving credit
facility. The rating outlook is changed to Positive.
FOSTER WHEELER: Net Income Reaches US$43.1MM in Second Quarter
--------------------------------------------------------------
Foster Wheeler Ltd. reported net income for the three months
ended June 30, 2006, of US$43.1 million, or US$0.61 per diluted
share, excluding a net gain of US$79.6 million from an asbestos
insurance settlement, a US$12.3 million charge relating to debt
reduction initiatives completed in May 2006, and stock option
expenses of US$2.0 million. Including these items, net income
for the quarter was US$108.4 million, or US$1.53 per diluted
share.
For the first six months of 2006, net income was US$59.7 million
or US$0.85 per diluted share, excluding the second-quarter items
described above, as well as US$1.8 million of first-quarter 2006
stock option expenses and, for EPS calculations only, the fair
value of additional shares issued in January 2006 as part of the
warrant offers. First-half 2006 net income including these
items was US$123.0 million, or US$1.48 per diluted share.
"I am delighted with our performance this quarter," said Raymond
J. Milchovich, chairman, president and chief executive officer.
"In particular, our Global Engineering and Construction (E&C)
Group has once again delivered an outstanding operational
performance and has continued to build high quality backlog.
Compared with the year-ago quarter, E&C EBITDA increased by 67%.
Measured in Foster Wheeler scope, which excludes flowthrough
costs, E&C revenues increased by 20 percent, new orders booked
increased by 54 percent and backlog increased by 67%. The E&C
markets we serve remain extremely strong and we have continued
to add capacity in our Global E&C Group. We have increased this
Group's capacity by an additional eight percent during the
second quarter of 2006 and will continue to expand its capacity
intelligently and as quickly as possible, to meet the needs of
our clients."
Consolidated second-quarter 2006 EBITDA (earnings before income
taxes, interest expense, depreciation and amortization),
excluding the insurance settlement gain, debt reduction charge
and stock option expense items referred to above, increased by
37% to US$87.2 million, compared with US$63.5 million for the
second quarter of 2005. For comparison purposes, the second-
quarter 2005 EBITDA amount excluded a US$1.3 million charge
relating to debt reduction initiatives. Including these items,
consolidated second-quarter 2006 EBITDA was US$152.5 million,
compared with US$62.2 million for the second quarter of 2005.
Consolidated EBITDA, excluding the above items, was US$135.0
million for the first half of 2006, an increase of 43 percent
from US$94.7 million for the first half of 2005. Consolidated
EBITDA, including the above items, was US$198.4 million for the
first half of 2006, compared with US$93.4 million for the second
quarter of 2005.
The company achieved another very strong bookings quarter. New
orders booked in the second quarter of 2006, measured in scope,
increased to US$908.7 million, up 66 percent from US$547.7
million in the year-ago quarter. For the first six months of
2006, bookings measured in scope increased significantly to
US$1.74 billion, up 77% from US$986.4 million for the same
period last year.
Operating revenues in the second quarter of 2006, measured in
scope, increased by 32% to US$623.5 million, up from US$470.8
million in the second quarter of 2005. Operating revenues for
the second quarter of 2006, including flowthrough costs,
increased to US$745.3 million, up 42% from US$526.0 million in
the second-quarter of 2005. For the first half of 2006,
operating revenues measured in scope were US$1.14 billion, up by
29% from US$885.9 million for the first half of 2005. Including
flowthrough costs, first-half 2006 operating revenues were
US$1.39 billion, up by 33% from US$1.05 billion for the first
half of 2005.
Backlog measured in scope has continued to grow very strongly,
increasing to US$2.84 billion at the end of the second quarter
of 2006, an increase of 83% compared with backlog of US$1.56
billion at the end of the second quarter of 2005.
Total cash and short-term investments at the end of the second
quarter of 2006 were US$358.1 million, of which US$268.0 million
were held by non-U.S. subsidiaries. This compares with US$425.6
million at the end of the first quarter of 2006 and US$326.4
million at the end of the second quarter of 2005. During the
second quarter of 2006, the company spent US$79.9 million in
corporate debt reduction initiatives and funded US$19.1 million
of costs of asbestos litigation, defense, and case resolution.
As announced on July 7, 2006, the company's subsidiaries reached
an agreement on June 30, 2006, to settle their asbestos-related
claims for insurance coverage with an additional insurer. As a
result of this settlement, the Company has increased its
recorded asbestos-related insurance assets by US$79.6 million,
and has recorded a second-quarter 2006 gain of US$79.6 million.
The company continues to litigate its claims against its
remaining unsettled insurers while engaging in active settlement
negotiations with these insurers.
About Foster Wheeler
Headquartered 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$525,565,000
equity deficit on Dec. 31, 2004.
* * *
Standard & Poor's Ratings Services assigned on Aug. 2, 2006, its
'BB-' bank loan rating and '1' recovery rating on Foster Wheeler
Ltd.'s proposed five-year, US$350 million senior secured credit
facilities due 2011, reflecting a high expectation of full
recovery of principal (100%) in the event of a payment default.
* * *
Moody's Investors Service assigned on Aug. 2, 2006, a Ba3 rating
to Foster Wheeler LLC's proposed US$350 million senior secured
domestic credit facility subject to final documentation. The
credit facility is expected to consist of a five-year US$200
million revolving credit facility and a five-year US$150
million synthetic letter of credit facility.
GLOBAL CROSSING: Reports Second Quarter Revenue of US$456 Mil.
--------------------------------------------------------------
In reporting second quarter 2006 financial results, Global
Crossing disclosed that it has reached crucial inflection points
for revenue and adjusted Earnings Before Interest, Taxes,
Depreciation and Amortization. Management reaffirmed that the
company will begin to generate cash at some point in the second
half of the year, marking significant financial milestones.
"We have performed for the past seven quarters leading to the
achievement of our major goals, including generating positive
adjusted EBITDA in June," said John Legere, Global Crossing's
CEO. "After transforming the business and intentionally reducing
revenues to focus on more profitable services such as IP-based
carrier data and enterprise services, we're pleased to report
that consolidated revenue grew sequentially for the first time
in three years. This growth validates our strategy and shows
that the future looks extremely promising for Global Crossing."
Highlights
Global Crossing's consolidated revenue grew from US$456 million
in the first quarter of 2006 to US$461 million in the second
quarter of 2006. Revenue for the company's UK subsidiary (GCUK)
grew 7 percent sequentially -- that is, from the first quarter
of 2006 to the second quarter of 2006 -- to US$106 million.
Revenue from Global Crossing's "invest and grow" segment -- that
part of the business focused on serving global enterprises,
carrier data and indirect channel customers -- grew to US$299
million, a 5 percent increase over the prior quarter and a 9
percent increase year over year. Adjusted gross margin (as
defined in the tables that follow) increased US$4 million
sequentially. Cost of revenue decreased sequentially by 2
percent or US$8 million, and sales, general and administrative
(SG&A) costs decreased 15 percent or US$15 million. Adjusted
EBITDA (as defined in the tables that follow) loss for the
second quarter was US$17 million, a 62 percent or US$28 million
sequential improvement, and a 37 percent or US$10 million
improvement year over year.
Global Crossing also reported customer successes during the
second quarter, including a new contract with the U.S. General
Services Administration, an inter-carrier agreement with
Broadwing to expand their converged Internet Protocol offerings
globally and a new agreement with Banco Santander International
for IP convergence solutions. Responding to rapid growth in IP
traffic, Global Crossing announced investments in its core
network during the quarter. IP traffic grew 19 percent
sequentially during the second quarter and 102 percent year over
year.
Revenue and Margin
"Invest and grow" revenue increased by US$13 million, or 5
percent sequentially, to US$299 million in the second quarter of
2006, generating US$155 million in adjusted gross margin.
"Invest and grow" revenue from the company's GCUK subsidiary
grew for the first time in six quarters to US$103 million, a
US$5 million sequential increase. Outside of GCUK, "invest and
grow" revenue increased to US$196 million in the second quarter,
a 4 percent or US$8 million sequential improvement and a 20
percent improvement compared with the second quarter of 2005.
During the second quarter of 2006, the company's wholesale voice
segment generated US$160 million in revenue and US$18 million in
adjusted gross margin. These figures compare with US$168
million in revenue and US$19 million in adjusted gross margin
during the first quarter.
"Our 'invest and grow' strategy is yielding results, buoyed by
sustained demand for Global Crossing's IP offerings as
convergence becomes more mainstream," commented Legere. "The
net effect is that our consolidated revenue is up and operating
costs continue to come down leading to the improvement in the
company's results."
Cost of revenue -- which includes cost of access; technical real
estate, network and operations; third party maintenance and cost
of equipment sales -- was US$393 million in the second quarter,
down 2 percent from US$401 million in the first quarter of 2006
and down 8 percent from US$427 million in the second quarter of
2005. Cost of access accounted for US$286 million of Global
Crossing's cost of revenue during the second quarter,
approximately the same amount as in the first quarter. SG&A
costs were US$85 million in the second quarter of 2006, compared
with US$100 million in the first quarter of 2006 and US$99
million in the second quarter of last year.
Earnings
Adjusted EBITDA improved 62 percent sequentially and was a loss
of US$17 million in the second quarter of 2006, compared with a
loss of US$45 million in the first quarter of 2006. The
sequential improvement is attributed to higher absolute adjusted
gross margin, as well as reductions in the company's real estate
and network operations costs and SG&A. As noted previously,
Global Crossing generated positive adjusted EBITDA in June,
fulfilling its commitment of achieving positive adjusted EBITDA
at some point in the first half of 2006. Management expects that
the company will generate positive adjusted EBITDA on a
quarterly basis beginning in the third quarter of 2006 as a
result of continued improvements in revenue and ongoing
initiatives to reduce costs.
Adjusted EBITDA excluding non-cash stock compensation was a loss
of US$10 million in the second quarter, compared with a loss of
US$33 million in the first quarter of 2006.
Consolidated loss applicable to common shareholders was US$77
million, compared with a loss of US$109 million in the first
quarter of 2006.
Cash and Liquidity
As of June 30, 2006, unrestricted cash and cash equivalents
totaled US$456 million. Restricted cash was US$21 million.
Excluding net cash impact from second quarter financings
(including the purchase of U.S. treasury securities related to
the offerings and interest received from such offerings), Global
Crossing used US$52 million of cash in the second quarter. Cash
use included US$23 million for capital expenditures and
principal on capital leases, US$4 million for repayment of the
current portion of long term debt for capital purchases, US$23
million in interest payments on GCUK's senior notes and US$5
million related to the 2005 employee bonus. Cash sources
included US$10 million collected in sales proceeds for
Indefeasible Rights of Use.
The company reaffirmed its expectation that it will begin to
generate positive cash flow at some point during the second half
of 2006.
As required by the indenture governing its senior notes, GCUK
offered approximately US$26 million (15 million pounds sterling)
to tender a portion of the notes at par in the second quarter.
There were no valid tenders of either the U.S. dollar- or
British pounds sterling-denominated notes.
On May 10, 2006, the company signed a revolving credit facility
with Bank of America in the face amount of US$55 million, with
an initial maximum availability of US$35 million. Initial
advances under the facility are subject to certain state
regulatory approvals, which are expected by the beginning of the
fourth quarter of 2006, and to customary closing conditions.
On May 30, 2006, Global Crossing closed two concurrent public
offerings, generating US$384 million in gross proceeds. The
offerings included 12 million common shares for gross proceeds
of US$240 million and US$144 million in senior convertible
notes. After deducting underwriters' discounts and other direct
fees expected to be paid by the end of 2006, net proceeds from
the public offerings will be approximately US$371 million.
Approximately US$20 million of the net proceeds was used to
purchase a portfolio of U.S. treasury securities to fund the
first six interest payments on such notes related to the
offerings.
Headquartered in Florham Park, New Jersey, Global Crossing
Ltd. -- http://www.globalcrossing.com/-- provides
telecommunication services 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 US$51 million of
positive equity at Dec. 31, 2004.
INTELSAT LTD: Offers to Exchange 9-1/4% Senior Discount Notes
-------------------------------------------------------------
Intelsat, Ltd., is offering to exchange any 9-1/4% Senior
Discount Notes due 2015 for newly issued 9-1/4% Senior Discount
Notes due 2015.
The terms of the exchange notes to be issued in the exchange
offer are substantially identical to the original notes, except
that the exchange notes will be freely tradeable and will not
benefit from the registration and related rights pursuant to
which the Company is conducting the exchange offer. All
untendered original notes will continue to be subject to the
restrictions on transfer set forth in the original notes and in
the applicable indenture.
The original notes were issued by Intelsat (Bermuda), Ltd.
Recently, Intelsat (Bermuda), Ltd., transferred substantially
all its assets to its wholly-owned subsidiary, Intelsat
Intermediate Holding Company, Ltd., and Intelsat Intermediate
Holding Company, Ltd. assumed substantially all its obligations,
including its obligations in respect of the original notes.
Accordingly, Intelsat Intermediate Holding Company, Ltd. is
currently an obligor on the original notes and will be issuing
any new notes issued in exchange pursuant to the exchange offer.
Intelsat, Ltd. is a co-obligor on the original notes, and will
be a co-obligor on the exchange notes.
The Company will not receive any proceeds from the issuance of
the notes in this exchange offer.
A full-text copy of the Prospectus is available at no additional
charge at http://researcharchives.com/t/s?f18
About Intelsat
Intelsat, Ltd. - http://www.intelsat.com/-- offers telephony,
corporate network, video and Internet solutions around the globe
via capacity on 25 geosynchronous satellites in prime orbital
locations. Customers in approximately 200 countries rely on
Intelsat's global satellite, teleport and fiber network for
high-quality connections, global reach and reliability. In
Bermuda, the company operates through Intelsat (Bermuda) Ltd.
* * *
As reported in the Troubled Company Reporter on June 19, 2006,
Fitch upgraded the Issuer Default Rating for Intelsat to 'B'
from 'B-' pro forma for its pending acquisition of PanAmSat.
The ratings were also removed from Rating Watch Negative, where
they had originally been placed on Aug. 30, 2005. Fitch said
the Rating Outlook is Stable.
As reported in the Troubled Company Reporter on June 13, 2006,
Moody's Investors Service affirmed the B2 corporate family
rating of Intelsat, Ltd., and downgraded the corporate family
rating of PanAmSat Corp. to B2, given the greater clarity
regarding the final capital structure and the near-term
completion of the PanAmSat acquisition by Intelsat.
QUANTA CAPITAL: Posts US$42.9 Million Net Loss in 2nd Quarter
-------------------------------------------------------------
Quanta Capital Holdings Ltd. (NASDAQ: QNTA) reported financial
results for the second quarter ended June 30, 2006.
Quanta Capital reported a US$42.9 million net loss for the
second quarter 2006, compared with an US$8.5 million net income
in the same period last year.
Net loss excluding net realized losses on investments for the
second quarter of 2006 was US$36.2 million, compared with net
income excluding realized gains on investments for the second
quarter of 2005 of US$7.7 million.
Second quarter 2006 results include additional provision for
employee severance of approximately US$10.7 million which is a
direct result of Quanta's decision to place most of its
specialty insurance and reinsurance lines into orderly run-off
and US$3.6 million in additional losses from the 2005
hurricanes. The Company also recognized US$12.6 million as
goodwill impairment expense related to its investment in ESC as
Quanta's insurance companies are no longer writing environmental
policies that complement ESC's ongoing business.
Strategic Alternatives
Quanta Capital continues to pursue strategic alternatives, which
may include:
-- the sale of the Company or some or all of its businesses;
-- the commutation of certain contracts;
-- sale of renewal rights of certain business lines;
-- the engagement of an administrator to run-off all or a
portion of its book of business; or
-- a combination of one or more of these alternatives.
Key developments during the second quarter of 2006 also included
the decision to cease underwriting or seeking new business and
to place most of its remaining specialty insurance and
reinsurance lines into orderly run-off following A.M. Best
rating actions and the subsequent withdrawal of its ratings.
Quanta's Lloyd's syndicate and environmental consulting
business, ESC, are not included in the run-off plan and will
continue to seek new business.
Gross written premiums for the second quarter of 2006 were
US$32.9 million and net written premiums were US$10.1 million.
This includes US$23.3 million and US$15.8 in gross and net
written premium from Lloyd's and US$24.9 million and US$10.4
million in gross and net written premium from our home builder's
program, known as HBW. We expect that HBW will continue to
generate premium until December 2006 when it will be terminated.
Quanta Capital also returned US$27.7 million in gross written
premium to policyholders following policy cancellation and
commutations. In future periods, the Company believes that
comparisons versus prior year results are not meaningful as the
Company is underwriting a limited amount of new policies.
Net premiums earned in the second quarter were US$60.4 million.
Specialty insurance contributed US$51.2 million of the net
premiums earned and specialty reinsurance contributed US$9.2
million. Technical services revenues for the second quarter of
2006 were US$7.8 million compared to revenues of US$7.2 million
for the second quarter of 2005.
Quanta Capital also disclosed that it has started the process of
communicating its run-off plan with its regulators during the
second quarter of 2006.
About Quanta Capital
Headquartered in Hamilton, Bermuda, Quanta Capital Holdings Ltd.
-- http://www.quantaholdings.com/-- operates its Lloyd's
syndicate in London and its environmental consulting business
through Environmental Strategies Consulting in the United
States. The Company is in the process of running off its
remaining business lines. The Company maintains offices in
Bermuda, the United Kingdom, Ireland and the United States.
* * *
As reported in the Troubled Company Reporter-Latin America on
June 9, 2006, A.M. Best Co. downgraded the financial strength
ratings to B from B++ and the issuer credit ratings to "bb" from
"bbb" for the insurance/reinsurance subsidiaries of Quanta
Capital Holdings Ltd.
A.M. Best also downgraded Quanta's ICR to "b" from "bb" and the
securities rating to "ccc" from "b+" for its US$75 million
10.25% Series A non-cumulative perpetual preferred shares. All
ratings have been removed from under review with negative
implications and assigned a negative outlook.
Subsequently, all ratings of Quanta had been withdrawn and the
FSRs assigned a rating of NR-4 in response to management's
request that Quanta be removed from A.M. Best's interactive
rating process.
REFCO INC: Chapter 7 Trustee Wants Court to Confirm Authority
-------------------------------------------------------------
Albert Togut, the interim Chapter 7 trustee appointed to oversee
the liquidation of Refco, LLC's estate, asks the Honorable
Robert Drain of the U.S. Bankruptcy Court for the Southern
District of New York to confirm that his authority to operate
Refco LLC's business continues past Aug. 22, 2006, until
terminated by further Court order.
The Court authorized Mr. Togut, to operate the Chapter 7
Debtor's business pursuant to Sections 721 of the Bankruptcy
Code. The operation aims to, inter alia, consummate a sale of
Refco LLC's assets to Man Financial, Inc., and otherwise taking
necessary steps to wind down Refco LLC's business affairs.
The Bankruptcy Court entered a supplemental operating order on
March 27, 206, authorizing the Chapter 7 Trustee to:
(i) permit customers to work out of open trading positions
in any "Open Excluded Accounts";
(ii) direct Man Financial to liquidate open trading positions
in any Open Excluded Account; and
(iii) transfer account positions to a third party and take
necessary actions to mitigate the estate's potential
losses.
The Court also extended its express grant of qualified immunity
to any decisions and activities of the Chapter 7 Trustee.
Under an order allowing Refco LLC to assume and perform the
Acquisition Agreement, the Chapter 7 Trustee will provide
certain transition services to Man Financial for up to 270 days
following consummation of the Sale, which date falls on Aug. 22,
2006. This deadline will, among others, determine whether Man
Financial wants to take an assignment of various executory
contracts and nonresidential real property leases.
Moreover, the Chapter 7 Trustee states that he is responsible
for complying with the applicable provisions of the Commodity
Exchange Act and Title 17 of the Code of Federal Regulations,
including Part 190 - "Bankruptcy," promulgated by the Commodity
Futures Trading Commission. These regulations impose numerous
obligations on the Chapter 7 Trustee with respect to customer
securities, property or other commodities contracts.
Scott E. Ratner, Esq., at Togut, Segal & Segal LLP, in New York,
however, tells Judge Drain that numerous Sale-related tasks like
completing reconciliation and allocation of the Sale proceeds
and consummating various transactions related to the Sale still
remain to be completed. In addition, the Chapter 7 Trustee has
not completed the wind-down of Refco LLC's business and
administration of its estate.
The Chapter 7 Trustee wants to make abundantly clear that the
Supplemental Operating Order was meant to expand and not limit
the Initial Operating Order. The Chapter 7 Trustee asserts that
the clarification request will permit him to continue to fulfill
his obligations under the Sale Order, the Acquisition Agreement,
the CFTC regulations, and Subchapter IV of Chapter 7, which
obligations he likely could not satisfy without the authority
granted by the Operating Orders.
About Refco Inc.
Based in New York, Refco Inc. -- http://www.refco.com/-- is a
diversified financial services organization with operations in
14 countries and an extensive global institutional and retail
client base. Refco's worldwide subsidiaries are members of
principal U.S. and international exchanges, and are among the
most active members of futures exchanges in Chicago, New York,
London and Singapore. In addition to its futures brokerage
activities, Refco is a major broker of cash market products,
including foreign exchange, foreign exchange options, government
securities, domestic and international equities, emerging market
debt, and OTC financial and commodity products. Refco is one of
the largest global clearing firms for derivatives.
The Company and 23 of its affiliates filed for chapter 11
protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006).
J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP, represent the Debtors in their restructuring efforts. Luc
A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP,
represents the Official Committee of Unsecured Creditors. Refco
reported US$16.5 billion in assets and US$16.8 billion in debts
to the Bankruptcy Court on the first day of its chapter 11
cases.
Refco LLC, an affiliate, filed for chapter 7 protection on
Nov. 25, 2005 (Bankr. S.D.N.Y. Case No. 05-60134). Refco, LLC,
is a regulated commodity futures company that has businesses in
the United States, London, Asia and Canada. Refco, LLC, filed
for bankruptcy protection in order to consummate the sale of
substantially all of its assets to Man Financial Inc., a wholly
owned subsidiary of Man Group plc. Albert Togut, the chapter 7
trustee, is represented by Togut, Segal & Segal LLP.
On April 13, 2006, the Court appointed Marc S. Kirschner as
Refco Capital Markets Ltd.'s chapter 11 trustee. Mr. Kirschner
is represented by Bingham McCutchen LLP. RCM is Refco's
operating subsidiary based in Bermuda.
Three more affiliates of Refco, Westminster-Refco Management
LLC, Refco Managed Futures LLC, and Lind-Waldock Securities LLC,
filed for chapter 11 protection on June 6, 2006 (Bankr. S.D.N.Y.
Case Nos. 06-11260 through 06-11262). (Refco Bankruptcy News,
Issue No. 36; Bankruptcy Creditors' Service, Inc., 215/945-
7000).
REFCO INC: Files Amended Claimants List on Master Proof Filing
--------------------------------------------------------------
Refco, Inc., and its debtor-affiliates filed with the U.S.
Bankruptcy Court for the Southern District of New York an
amended list of claimants to which the Debtors extended benefits
of an agreed order concerning filing of master proofs of claim
against the Debtors, excluding Refco Capital Markets, Ltd., and
Refco, LLC.
A schedule of the Requesting Claimants as of July 21, 2006, is
available for free at http://ResearchArchives.com/t/s?eaa
The Court had authorized certain claimants asserting identical
claims against each of the Debtors other thanRefco Capital
Markets, Ltd., and Refco, LLC, to file a master proof of claim
if these requirements were met:
(a) The proof of claim is filed in the bankruptcy estate of
Refco Group Ltd, LLC., Case No. 05-60027.
(b) The actual proof of claim form provides that the claim
also applies to all RGL affiliates, except RCM and
Refco, LLC.
Judge Drain ruled that the Master Proof of Claim will be deemed
to have been filed in the bankruptcy estates of each of the
Other Refco Debtors without further Court order, action, or
undertaking by a Requesting Claimant.
Nothing in the Order will prohibit any Requesting Claimant from
filing individual proofs of claim in lieu of a Master Proof of
Claim against each of the Other Refco Debtors.
The Debtors may, in their sole discretion, extend the benefits
of the Order to other claimants without further Court order at
any time before expiration of the July 16, 2006 Bar Date by
having their counsel sign a schedule referencing the Order and
providing the names of additional creditors who wish to be
deemed a Requesting Claimant.
About Refco Inc.
Based in New York, Refco Inc. -- http://www.refco.com/-- is a
diversified financial services organization with operations in
14 countries and an extensive global institutional and retail
client base. Refco's worldwide subsidiaries are members of
principal U.S. and international exchanges, and are among the
most active members of futures exchanges in Chicago, New York,
London and Singapore. In addition to its futures brokerage
activities, Refco is a major broker of cash market products,
including foreign exchange, foreign exchange options, government
securities, domestic and international equities, emerging market
debt, and OTC financial and commodity products. Refco is one of
the largest global clearing firms for derivatives.
The Company and 23 of its affiliates filed for chapter 11
protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006).
J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP, represent the Debtors in their restructuring efforts. Luc
A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP,
represents the Official Committee of Unsecured Creditors. Refco
reported US$16.5 billion in assets and US$16.8 billion in debts
to the Bankruptcy Court on the first day of its chapter 11
cases.
Refco LLC, an affiliate, filed for chapter 7 protection on
Nov. 25, 2005 (Bankr. S.D.N.Y. Case No. 05-60134). Refco, LLC,
is a regulated commodity futures company that has businesses in
the United States, London, Asia and Canada. Refco, LLC, filed
for bankruptcy protection in order to consummate the sale of
substantially all of its assets to Man Financial Inc., a wholly
owned subsidiary of Man Group plc. Albert Togut, the chapter 7
trustee, is represented by Togut, Segal & Segal LLP.
On April 13, 2006, the Court appointed Marc S. Kirschner as
Refco Capital Markets Ltd.'s chapter 11 trustee. Mr. Kirschner
is represented by Bingham McCutchen LLP. RCM is Refco's
operating subsidiary based in Bermuda.
Three more affiliates of Refco, Westminster-Refco Management
LLC, Refco Managed Futures LLC, and Lind-Waldock Securities LLC,
filed for chapter 11 protection on June 6, 2006 (Bankr. S.D.N.Y.
Case Nos. 06-11260 through 06-11262). (Refco Bankruptcy News,
Issue No. 36; Bankruptcy Creditors' Service, Inc., 215/945-
7000).
REFCO INC: Customers Want Rule 2004 Examination on Refco F/X
------------------------------------------------------------
Pursuant to Rule 2004 of the Federal Rules of Bankruptcy
Procedure, an ad hoc committee of Refco F/X Associates, LLC
customers asks the U.S. Bankruptcy Court for the Southern
District of New York to authorize and direct FXA to disclose
names and contact information of each of its account holders who
maintained trading accounts with a positive account balance as
of Oct. 17, 2005.
The Customer Committee is currently composed of around 200 FXA
customers working to protect and advance the interests of the
FXA customer body as a whole.
The Customer Committee members believe that many additional
customers would be interested in participating in the proceeding
through the Committee if they were informed of the opportunity.
By joining the Committee, the FXA customers will also be able to
enhance the value of FXA's estate by, among other things,
working with the Debtors and the Official Committee of Unsecured
Creditors to increase the proceeds from the sale of FXA assets.
Todd E. Duffy, Esq., at Duffy & Amedeo LLP, in New York, tells
Judge Drain that the Customer Committee is entitled to customer
information pursuant to the Bankruptcy Court's Oct. 20, 2005
order and Bankruptcy Rule 1007(a)(1), which require FXA to file
with its petition a list containing names and addresses of each
of its creditors.
Mr. Duffy ensures that the requested disclosure will preserve
the FXA customers' rights.
To the extent that a settlement between the Customer Committee
and FXA is achieved, allowing more customers to participate in
the settlement could benefit the estate and its creditors by
satisfying a significant portion of FXA's creditor body and
clearing the way for a more comprehensive plan of
reorganization, Mr. Duffy states.
About Refco Inc.
Based in New York, Refco Inc. -- http://www.refco.com/-- is a
diversified financial services organization with operations in
14 countries and an extensive global institutional and retail
client base. Refco's worldwide subsidiaries are members of
principal U.S. and international exchanges, and are among the
most active members of futures exchanges in Chicago, New York,
London and Singapore. In addition to its futures brokerage
activities, Refco is a major broker of cash market products,
including foreign exchange, foreign exchange options, government
securities, domestic and international equities, emerging market
debt, and OTC financial and commodity products. Refco is one of
the largest global clearing firms for derivatives.
The Company and 23 of its affiliates filed for chapter 11
protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006).
J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP, represent the Debtors in their restructuring efforts. Luc
A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP,
represents the Official Committee of Unsecured Creditors. Refco
reported US$16.5 billion in assets and US$16.8 billion in debts
to the Bankruptcy Court on the first day of its chapter 11
cases.
Refco LLC, an affiliate, filed for chapter 7 protection on
Nov. 25, 2005 (Bankr. S.D.N.Y. Case No. 05-60134). Refco, LLC,
is a regulated commodity futures company that has businesses in
the United States, London, Asia and Canada. Refco, LLC, filed
for bankruptcy protection in order to consummate the sale of
substantially all of its assets to Man Financial Inc., a wholly
owned subsidiary of Man Group plc. Albert Togut, the chapter 7
trustee, is represented by Togut, Segal & Segal LLP.
On April 13, 2006, the Court appointed Marc S. Kirschner as
Refco Capital Markets Ltd.'s chapter 11 trustee. Mr. Kirschner
is represented by Bingham McCutchen LLP. RCM is Refco's
operating subsidiary based in Bermuda.
Three more affiliates of Refco, Westminster-Refco Management
LLC, Refco Managed Futures LLC, and Lind-Waldock Securities LLC,
filed for chapter 11 protection on June 6, 2006 (Bankr. S.D.N.Y.
Case Nos. 06-11260 through 06-11262). (Refco Bankruptcy News,
Issue No. 35; Bankruptcy Creditors' Service, Inc., 215/945-
7000).
=============
B O L I V I A
=============
INTERNATIONAL PAPER: Sells Unit to CMP Holdings for US$1.4 Bil.
---------------------------------------------------------------
International Paper completed the sale of its coated and
supercalendered papers business to CMP Holdings LLC, for
approximately US$1.4 billion, plus approximately US$30 million
in the form of a 10% limited partnership interest in CMP
Investments L.P.
CMP Investments L.P is the parent company of CMP Holdings, which
is also a subsidiary of Verso Paper Holdings LLC, an affiliate
of Apollo Management L.P.
New Name
The business will be renamed Verso Paper Holdings LLC. It
annually produces approximately 1.7 million tons of coated
freesheet and coated groundwood papers for the magazine, catalog
and retail insert markets. It includes four paper mills,
located in Jay, Maine; Bucksport, Maine; Quinnesec, Mich.; and
Sartell, Minn., and generated US$1.6 billion in sales in 2005.
Its major brands are Advocate(R), Influence(R), Liberty(TM),
Savvy(R), Trilogy(R) and Velocity(TM). The business, which will
remain headquartered in Memphis, Tenn., employs approximately
3,000 people.
Sale of Sartell Hybrid Poplar
International Paper also disclosed that it has agreed to sell
the Sartell Hybrid Poplar Farm to CMP Fiber Farm LLC, a
subsidiary of CMP Investments.
Based in Stamford, Connecticut, International Paper Company
(NYSE: IP) -- http://www.internationalpaper.com/-- is in the
forest products industry for more than 100 years. The company
is currently transforming its operations to focus on its global
uncoated papers and packaging businesses, which operate and
serve customers in the U.S., Europe, South America and Asia.
Its South American operations include, among others, facilities
in Argentina, Brazil, Bolivia, and Venezuela. These businesses
are complemented by an extensive North American merchant
distribution system. International Paper is committed to
environmental, economic and social sustainability, and has a
long-standing policy of using no wood from endangered forests.
* * *
Moody's Investors Service assigned a Ba1 senior subordinate
rating and Ba2 Preferred Stock rating on International Paper
Company on Dec. 5, 2005.
* BOLIVIA: Franklin Mining & YPFB to Form Joint Venture
--------------------------------------------------------
Franklin Mining, Inc., and Yacimientos Petroliferos Fiscales
Bolivianos aka YPFB, the Bolivian state-owned oil company, will
enter into a S.A.M. or a Bolivian Joint Venture 5149 associated
partnership that guarantees investment and gas per Bolivian law.
Franklin's CEO Jaime Melgarejo disclosed that Dr. Jorge
Alvarado, President of YPFB, confirmed that Bolivia's proven and
probable natural gas reserves have been understated for several
years and that steps are being taken to correct all reports,
hence, the development of the proposed alliance.
PetroleumWorld.com reported on June 6, 2006, that Franklin
Mining, Inc. GTL investment commitments by the world's largest
oil companies appear likely to expand significantly over the
next decade. Virtually all major oil production companies
including ExxonMobil, Shell, ConocoPhillips and Chevron have
announced GTL programs that are either in place or soon will be
in place. The Peninsula, Qatar's leading English-language
newspaper, reported in their May 24, 2006 online edition under
the headline "Qatar enters energy big league, signals caution" a
string of mega-projects to produce clean, liquid fuels from
Qatar's gas reserves -- the world's third largest.
Bolivia holds Latin America's second largest natural gas
reserves; the increased natural gas availability together with
an increasing worldwide demand for GTL-produced fuels provides
the YPFB-Franklin joint venture with a promising export market.
YPFB executives have traveled to the U.S. to confirm the
suspected errors in calculating reserves. YPFB technicians have
traveled to Argentina to better understand the determination and
reporting process for proven and probable natural gas reserves.
It is against this backdrop that Bolivia's YPFB, in S.A.M. with
FMNJ's Franklin Oil & Gas, Bolivia S.A., has confirmed a plan to
construct and operate a single plant capable of generating an
almost immediate end to Bolivian reliance on imported diesel
fuels. The S.A.M. joint venture percentage is shared 51/49,
with 51% allotted to YPFB and 49% to Franklin Oil & Gas.
In a partnership structured almost identical to an agreement
between ExxonMobil and Qatar Petroleum, Franklin will provide
the project's technology and management skills and arrange
financing of the plant's design and construction costs, while
partner YPFB will provide the natural gas. In addition, YPFB
will provide a sales, marketing and distribution infrastructure
for diesel fuels.
Basic GTL technology dates to 1923 when two German scientists,
Franz Fischer and Hans Tropsch, invented a process for
converting natural gas to a hydrocarbon, which could be upgraded
to petroleum products. GTL-produced diesel fuel significantly
reduces emissions resulting in less pollution, cleaner air.
Because fuel produced by the YPFB and Franklin joint venture's
processing plant will be identical in all characteristics to the
diesel fuel presently being imported, all existing marketing and
distribution resources and methodologies will remain unchanged,
requiring no capital investment. At current daily consumption
rates, an estimated 3,500 to 5,000 barrels per day will be
available for export after Bolivia's domestic requirements are
met. The current market price of conventional grade diesel fuel
ranges between US$65 and US$67 per barrel.
Franklin Oil & Gas, Bolivia S.A. is a subsidiary of Franklin
Mining, Inc. and YPFB is Bolivia's state-owned oil company.
Their joint venture company will maintain a Regional Office in
La Paz and an operations office in the city of Santa Cruz. The
joint venture's GTL processing plant is planned to be
constructed in the Grande River region of the Department of
Santa Cruz, in the eastern portion of Bolivia.
About Franklin Mining, Inc.
Franklin Mining, Inc - http://franklinmining.com/-- currently
have interests in Bolivia and the United States. The company
opened opened a division named Franklin Oil & Gas, and opened
subsidiaries in Bolivia -- Franklin Mining, Bolivia and Franklin
Oil & Gas, Bolivia.
* * *
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
===========
B R A Z I L
===========
ALERIS INT: Texas Pacific Merger Cues S&P to Watch Ratings
----------------------------------------------------------
Standard & Poor's Ratings Services placed its 'BB-' corporate
credit and other ratings on Beachwood, Ohio-based Aleris
International Inc. on CreditWatch with negative implications.
The rating action follows the announcement that Texas Pacific
Group has come to an agreement to acquire the outstanding stock
of Aleris for approximately US$1.7 billion plus assume or repay
approximately US$1.6 billion of debt. The CreditWatch placement
reflects Standard & Poor's concerns of additional debt in the
capital structure. Details of Texas Pacific's financing for
this acquisition were not disclosed.
Aleris produces aluminum alloys, aluminum sheet, zinc oxide, and
zinc dust. The company also recycles aluminum and zinc. On
Aug. 1, 2006, Aleris completed the purchase of the downstream
aluminum business of Corus Group PLC (BB/Stable/B) for
approximately US$887 million. Texas Pacific is a private
investment firm with more than US$30 billion of assets under
management.
"We could lower the ratings if financial leverage materially
increases. The ratings could be affirmed if financial leverage
remains unchanged after the acquisition and we continue to
expect financial leverage to decline to less than 4x," said
Standard & Poor's credit analyst Marie Shmaruk.
Resolution of the CreditWatch will entail a review of Texas
Pacific's financial policies and Aleris' final capital
structure. The transaction is expected to close early in 2007
pending the receipt of stockholder approval, the expiration of
the waiting period under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, and the satisfaction of other
customary closing conditions.
AMPLA ENERGIA: S&P Affirms BB- Corporate Credit Rating
------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB-' corporate
credit rating on Brazilian electric utility Ampla Energia e
Servicos S.A. The outlook is stable.
The company's ratings are supported by
-- balanced financial standing supports, with credit measures
in line with the rating category. As of June 2006, Ampla
had
-- funds from operations to total debt of 24.6%,
-- total debt to capitalization of 48.1%,
-- total debt to EBITDA of 2.47x, and
-- FFO to gross interest coverage of 2.16x.
-- Steady, sizable residential and commercial customer bases
(jointly representing approximately 70% of total
revenues), although they are more correlated to changes in
temperatures.
-- A monopoly franchise to distribute energy in part of the
state of Rio de Janeiro.
-- Minimal exposure to foreign currency risk on its debts
(less than US$25 million).
The ratings also reflect these weaknesses:
-- Ampla faces the challenge of reducing its high level of
energy losses (about 21.1% in June 2006), which restrains
the company's capacity to improve cash generation,
-- Annual capital spending has been increased more than 30%
since 2004 because of several investments directed to
energy loss reduction, and this has already shown
results.
-- The company has a significant amount of historical
past-due receivables, which currently account for more
than twice the amount of monthly net revenues, and keeps
working to raise the collection effectiveness (total
collected vis-a-vis total billed).
-- Exposure to a new and evolving regulatory environment in
Brazil, although implementation has taken place without
major incident so far.
"The stable outlook reflects our expectation that Ampla will
maintain its capital structure with a soft annual amortization
schedule," said Standard & Poor's credit analyst Marcelo Costa.
"In addition, we expect the company to continue posting
comfortable cash flow protection measures," said Mr. Costa.
BANCO NACIONAL: Approves BRL66.1 Mil. Financing to MRC Servicos
---------------------------------------------------------------
Banco Nacional de Desenvolvimento Economico e Social aka BNDES
approved a BRL66.1 million financing to MRC Servicos
Ferroviarios CRIB-AL Ltda, which is managed by the Mitsui group.
The resources will be used to acquire 400 new wagons for the soy
transportation in the States of:
-- Parana,
-- Santa Catarina and
-- Rio Grande do Sul.
From the total, 200 wagons will be the "Hooper" closed type, for
the grain transportation, and the other 200 wagons will be the
"Tank" type, for the vegetable oil transportation. The
financing from BNDES accounts for 80% of the total budget of
BRL82.6 million.
This financing operation generates positive impacts, not only on
the railway sector, but also on the Brazilian export
competitiveness. Those investments allow an increase in the
current transportation capacity through railways, aiding in the
solution of the problem in the increasing demand of railway
transportation of soy in the South region of Brazil.
To the railway sector, BNDES financing will imply more network
use in the soy product transportation and in the financial
structures that do not burden the balance of concessionaires and
decrease in transportation costs. Moreover, it makes the
Brazilian soy price more competitive in the International
market.
Those wagons will be manufactured by Randon S.A and by Amsted-
Maxion Fundicao e Equipamentos Ferroviarios S.A and will be
leased to Bunge, with a long-term lease contract. Bunge
operates in the agricultural commodities sector. It aims at
reducing its transportation costs, especially by decreasing the
roadway use.
It is reported that the expansion of cargo moving through
railways depends, not only on permanent investments, but also on
the increase of wagon and locomotive units. For this reason,
BNDES started financing the purchase of wagons by clients that
use the railway transportation, which decisively contributes in
the boosting of the Brazilian wagon industry.
The Brazilian railway system is the largest in Latin America in
terms of transported cargo, reaching 221.3 billion tons per
useful kilometer in 2005. It ranks seventh in the world in
cargo volume, after the United States of America, Russia, China,
India, Canada and Ukraine. The Brazilian railway network
stretches 29,800 kilometers.
* * *
As reported in the Troubled Company Reporter on March 3, 2006,
Standard & Poor's Ratings Services raised its foreign currency
counterparty credit rating on Banco Nacional de Desenvolvimento
Economico e Social S.A. aka BNDES to 'BB' with a stable outlook
from 'BB-' with a positive outlook. The company's local
currency credit rating was also shifted to 'BB+' with a stable
outlook from 'BB' with a positive outlook.
BANCO NACIONAL: Renews Agreement With Grande ABC Dev't Agency
-------------------------------------------------------------
Banco Nacional de Desenvolvimento Economico e Social aka BNDES'
Pres. Demian Fiocca, met with mayors of the ABC Development
Agency to renew the agreement of the BNDES Advanced Post.
ABC Development Agency includes these states:
-- Santo Andre,
-- Sao Bernardo do Campo,
-- Sao Caetano do Sul,
-- Diadema,
-- Maua,
-- Ribeirao Pires and
-- Rio Grande da Serra.
Also known as Consortium of City Halls, the agency, with
principal office in Santo Andre, has the objective of
implementing joint projects directed to the regional development
promotion.
BNDES is the strategic partner of ABC Development Agency in
financing projects directed to the economic and social
development of the region.
In 2005, BNDES disbursements to Grande ABC amounted BRL4.1
billion, with a strong impact on the generation of population's
income and job. In the first six months of 2006, disbursements
to the region reached BRL826.8 million.
* * *
As reported in the Troubled Company Reporter on March 3, 2006,
Standard & Poor's Ratings Services raised its foreign currency
counterparty credit rating on Banco Nacional de Desenvolvimento
Economico e Social S.A. aka BNDES to 'BB' with a stable outlook
from 'BB-' with a positive outlook. The company's local
currency credit rating was also shifted to 'BB+' with a stable
outlook from 'BB' with a positive outlook.
BLOUNT INT'L: Sells Dixon Assets to Husqvarna for US$34 Million
---------------------------------------------------------------
Blount International, Inc., has completed the sale of certain
assets of its subsidiary Dixon Industries, Inc., to a subsidiary
of Husqvarna. Blount received gross proceeds of US$34 million
upon the closing of the transaction.
The proceeds will be utilized to reduce debt, fund the closure
of the Company's Coffeyville, Kansas, facility and pay
applicable taxes and transaction fees. The company estimates
that net cash proceeds available for debt repayment from the
transaction will be between US$25 million and US$28 million.
About Husqvarna
Husqvarna is a producer of chainsaws, lawn mowers and other
portable petrol-powered garden equipment, such as trimmers and
blowers. The group is also a world leader in diamond tools and
cutting equipment for the construction and stone industries.
About Blount International
Blount International, Inc. (NYSE:BLT) -- http://www.blount.com/
-- is a diversified international company operating in three
principal business segments: Outdoor Products, Industrial and
Power Equipment and Lawnmower. Blount sells its products in
more than 100 countries around the world. Blount has one of its
manufacturing locations in Curitiba, Brazil.
At March 31, 2006, Blount International's balance sheet showed
US$462,269,000 in total assets and US$595,815,000 in total
liabilities, resulting in a stockholders' deficit of
US$133,546,000.
BV FINANCIERA: Moody's LatAm Rates Class B Shares at (P) Caa1
-------------------------------------------------------------
Moody's America Latina has assigned provisional ratings of
(P)Aaa.br on its Brazilian National Scale and of (P)Baa1 on its
Global Local Currency Rating Scale to the senior shares, and
(P)B3.br on its Brazilian National Scale and (P)Caa1 on its
Global Local Currency Scale to the subordinated Class B shares
to be issued by BV Financeira -- Fundo de Investimento em
Direitos Creditorios II aka BV FIDC II, a securitization backed
by a pool of auto loans originated by BV Financeira S.A. --
Credito, Financiamento e Investimento.
The provisional ratings of the senior shares are based on the
following principal factors:
-- The 30% minimum credit enhancement provided through the
subordinated Class A and Class B shares;
-- The 1% minimum available net excess spread;
-- The overall credit characteristics of the securitized pool
of auto loans, which consists mostly of installment loan
contracts associated mainly with used vehicles;
-- The ability of BV Financeira to capably service the
portfolio;
-- BV Financeira's strong credit assessment and loan
origination practices; and
-- The transaction structure and its legal framework,
including the bankruptcy remoteness of the issuer and
well-established Brazilian laws and regulations for the
securitization of auto loans.
The ratings of the subordinated Class B shares reflect the
deeply subordinated priority of these securities in the fund's
waterfall, as compared to the senior and the subordinated Class
A shares, and the level of expected loss associated with the
subordinated shares when considering the return of principal by
the fund's final maturity date.
Structure
BV FIDC II is structured as a closed-ended receivables'
investment fund. Its expected final tenor will be five years
from closing, divided in
(i) a 24-month revolving period, in which all cash flows are
used to make new purchases of auto loan receivables; and
(ii) a 36-month controlled amortizing period, in which cash
flows collected will be used sequentially to pay down
interest and principal on the senior shares on a monthly
basis.
Early wind-down triggers include pre-established maximum
delinquency and loss ratios on the securitized pool, as well as
in the event the issuer fails to maintain the 30% minimum
subordination ratio and the minimum net excess spread of 1% per
annum.
Pool Characteristics and Servicing
The collateral backing the transaction consists of a pool of
loans for the purchase of used and new cars originated by BV
Financeira that meet eligible criteria which include the
following requirements among others:
(i) loans must be current,
(ii) loans must have at least one installment already paid,
and
(iii) maximum loan amount of BRL50,000 per obligor.
Credit enhancement in the deal includes a 30% minimum
subordination which, together with a minimum net excess spread
of 1% per annum, will be available to mitigate risks such as
prepayments, interest rate mismatches, in addition to the credit
losses in the loan portfolio.
Banco Citibank S.A. (which Moody's rates D+ for bank financial
strength and B1 for global foreign currency deposits --which is
on review for a possible upgrade) will be the master servicer of
the transaction. As such, it will be responsible for verifying
that all receivables meet the eligibility criteria, monitoring
the early amortization triggers, in addition to managing all of
the issuer's daily financial and operating activities, among
other duties. Votorantim Asset Management DTVM Ltda will act as
the trustee.
The Originator
BV Financeira is the third largest originator of auto loans in
Brazil, with a total loan portfolio of about BRL10 billion (US$4
billion) as of December 2005. BV Financeira operates through
approximately 16,000 certified dealers located in the South and
Southeast regions of Brazil, and focuses primarily on used
sedans and sport-utility vehicles (which account for about 92%
of BV Financeira's loan portfolio). BV Financeira is 99.99%
controlled by Banco Votorantim S.A. (which Moody's rates D for
Bank Financial Strength, Ba1 for global local currency deposits,
and the Aa1.br on Brazilian National Scale, and Ba2 for Senior
Unsecured Debt (foreign currency), all under review for a
possible upgrade).
The complete rating actions are:
Senior Shares
-- (P)Aaa.br (National Scale);
-- (P)Baa1 (Global Local Currency Scale);
Subordinated Class B Shares
-- (P)B3.br (National Scale)
-- (P)Caa1 (Global Local Currency Scale).
COMPANHIA ENERGETICA: First Semester Net Income Reaches BRL665MM
----------------------------------------------------------------
Companhia Energetica de Minas Gerais aka Cemig reported results
for the first half of 2006.
Cemig reports that non-recurring items affected its net income
and EBITDA.
Net Income reached BRL665 million in the first half of 2006:
-- BRL4.10 per lot of 1,000 shares;
-- Net income declined 36% compared to BRL1,042 million
reported in the same period of 2005;
-- Cash flow generation, measured by EBITDA, decreased 29%
to BRL1,198 million; and
Non-Recurring Items:
-- Investment in the purchase of salaried bonus increase
of employees (BRL177 million).
-- Recomposition of CVA for TUST in 2006 (BRL93 million).
-- Deferred Tariff Readjustment in the first quarter
of 2005 (BRL583 million).
Fundamentals Ensure Sustainable Growth
Cemig is implementing its strategy to attain the maximum market
share in the segments in which it operates:
-- Acquisition of controlling stake of Light S.A. through
Rio Minas Energia Participacoes S.A. in which it has a
25% ownership;
-- Acquisition of stakeholding of Grupo Schahin on five
transmission companies, in partnership with private
investors; and
-- Commenced operations at Irape and Capim Branco I plants;
It is focusing on its main business -- electricity:
-- Sale of participation of Infovias in Way for BRL91
million;
It sold its generation capacity for the highest value permitted
in the second new energy auction:
-- 355 MW average
-- Average price of BRL125.48 / MWh
-- Contract term of 30 years
Record sales of 24,331 GWh in the first half of 2006:
-- Increase of 4.7% in sales to final customers;
-- Sales to other utilities, as the Initial Contracts
expired;
-- 17% growth of the network revenues compared to the first
half of 2005;
-- 62% increase of network transmission revenue ("TUST");
and
-- 3% increase of TUSD network revenue.
Cemig has 90,000 newly connected customers in the first half of
2006.
The company reports 29% increase year-on-year on its sales
volume.
First Half Sales Volume
1st Half 2006 (MWh)
2006 2005 Change
%
Residential 3,310,420 3,293,423 0.5%
Industrial 11,892,578 11,060,150 7.5%
Commercial 1,947,818 1,888,914 3.1%
Rural 859,973 828,961 3.7%
Others 1,332,325 1,280,526 4.0%
Wholesale 4,988,425 521,583 856.4%
TOTAL 24,331,539 18,873,557 28.9%
The results reflect:
-- the accelerated growth of the industrial class, the end
of initial contracts and the migrations of free consumers
in January 2005; and
-- Continuous growth in the last 5 quarters.
Outlook for Generation
-- Cemig is expanding its generation capacity by 455 MW in
2006. The addition of the last UHE de Capim Branco I
machine and two UHE Irape machines contributed to the
increase of 257 MW of installed capacity;
-- Secured the concession of UHE de Baguari of 140 MW; and
-- the fifth largest generator in Brazil.
Plant Installed Capacity Assured Energy
(MW) (MW medios)
Major Hydroelectric
plants
Sao Simao 1,710 1,281
Emborcacao 1,192 497
Nova Ponte 510 276
Jaguara 424 336
Miranda 408 202
Tres Marias 396 239
Volta Grande 380 229
Aimores 162 84
Outras 1,036 603
Total hydroelectrics 6,218 3,609
Total thermoelectrics 184 115
Eolica 1 0
Total 6,403 3,724
Capital Expenditure
BRL million
Business 2005 2006 1st half 2007
2006
Generation 397 130 60 98
Transmission 20 93 40 16
Distribution 691 1,136 546 1,335
Distribution 665 1,009 507 1,005
Extention and
reinforcement
of existing
networks 276 288 122 544
Light for All 291 711 379 461
Other 98 10 6 -
Sub-transmission 26 127 39 330
Holding 57 40 12 82
Subtotal 1,165 1,399 658 1,531
Other Businesses - - -
Reconciliation to
Cash Flow 191 - - -
Subtotal 1,356 1,399 658 1,531
INVESTMENT IN
ACQUISITIONS - 528 -
LIGHT - 184 -
TBE - 344 -
TOTAL (1 + 2 ) 1,356 1,927 658 1,531
Cemig Consolidated Debt - June 2006
The average cost of debt is 10.96% p.a., as of June 2006.
Principal Creditors
Banco ItauBBA BRL1.290 million (22%)
Debenturistas BRL1.287 million (22%)
Unibanco BRL701 million (12%)
Bradesco BRL616 million (11%)
Banco do Brasil BRL592 million (10%)
Eletrobras BRL274 million (5%)
BNDES BRL234 million (4%)
Companhia Energetica de Minas Gerais -- http://www.cemig.com.br/
-- is one of the largest and most important electric energy
utilities in Brazil due to its strategic location, its technical
expertise and its market. Cemig's concession area extends
throughout nearly 96.7% of the State of Minas Gerais, Brazil.
Cemig owns and operates 52 power plants, of which six are in
partnership with private enterprises, relying on a predominantly
hydroelectric energy matrix. Electric energy is produced to
supply more than 17 million people living in the state's 774
municipalities. In addition to those 52 plants, another three
are currently under construction.
Cemig is also active in several other states, through ventures
for the generation or the commercialization of energy in these
Brazilian states: in Santa Catarina (generation), Rio de Janeiro
(commercialization and generation), Esprito Santo (generation)
and Rio Grande do Sul (commercialization).
* * *
Cemig's BRL312,500,000 12.7% debentures due Nov. 1, 2009, carry
Moody's B1 rating.
COMPANHIA SIDERURGICA: Ratings Unaffected by New Investments
------------------------------------------------------------
Standard & Poor's Ratings Services said that its 'BB' long-term
corporate credit rating on Brazil-based steel maker Companhia
Siderurgica Nacional aka CSN is not affected by the Board of
Directors' approval of an investment of US$185 million in a
three-million ton-per-year cement plant, and of US$113 million
in a 500,000 tpy long steel products plant, both in Rio de
Janeiro, Brazil.
Standard & Poor's have factored the incursion of CSN in the
cement business and have already assessed it as neutral to the
company's credit profile. Capital commitment is small, and the
impact on CSN's consolidated cash flows and liquidity is
limited. Nevertheless, the cement industry in Brazil has faced
difficult market conditions and a very aggressive competitive
environment in the past year or so. Cement prices have declined
significantly as a reflection of this fiercer competition,
compressing the sector's profitability despite the demand ramp-
up this year (with volume growth around 10% compared with the
same period last year). CSN also announced that it will invest
in long-steel products (rebars, slabs, and wire rod), aiming at
taking full advantage of its cement distribution channel and
optimizing the off-spec output of its steel mill in Volta
Redonda. Standard & Poor's also have a neutral view of this
investment.
While providing some diversification for CSN's portfolio in the
long term, both the cement and long steel industries are fairly
consolidated sectors in Brazil. As a result, CSN will face
strong competition with much larger players in each of these
segments that have well established (if not expanding)
operations in the region that CSN will likely service. Although
they are not necessarily more capitalized than CSN (as the
company counts on solid cash generation and liquidity at its
core flat steel operation), competitors benefit from larger
scale and more geographic diversification within the country in
their respective segments than CSN.
CSN also announced second-quarter 2006 results. As expected,
operating profitability and cash flow remained heavily damaged
by the accident at the company's blast furnace #3, resulting in
depressed credit ratios (funds from operations-to-total debt and
total debt-to-EBITDA ratios at 19% and 3.7x, respectively, in
the 12 months ended June 30, 2006). The rating agency believes
those will start improving in the next quarters as the company
recovers production pace with the BF#3 restart and insurance
claims are cashed in. Cash remains strong at US$1.9 billion in
June 2006, but at the expense of a significant increase of
short-term debt (at US$1.4 billion in the same period).
Standard & Poor's does not foresee temporarily weak cash flows
negatively affecting CSN's long-term credit profile, provided
that short-term debt also declines in the next quarters.
COMVERSE TECHNOLOGY: Wants Until Sept. 25 to File Fin'l Report
--------------------------------------------------------------
Comverse Technology, Inc., has submitted a request to the NASDAQ
Listing Qualifications Panel for an additional extension of the
deadline for the company to regain compliance with the NASDAQ
continued listing requirements related to the filing of SEC
reports.
The Panel previously granted the company's request for continued
listing subject to the requirement that the company file its
Annual Report on Form 10-K for the fiscal year ended
Jan. 31, 2006, by Aug. 18, 2006, and its Quarterly Report on
Form 10-Q for the fiscal quarter ended April 30, 2006, by no
later than Sept. 1, 2006.
In its request for an additional extension, the company
requested that the Panel grant the company until
Sept. 25, 2006 to file both of these reports.
The company intends to announce the Panel's decision promptly
after it receives written notice of such decision.
About Comverse Technology
Comverse Technology, Inc. (NASDAQ: CMVT) --
http://www.comverse.com/-- provides software and systems that
enable network-based multimedia enhanced communication and
billing services. Over 450 communication and content service
providers in more than 120 countries use Comverse products to
generate revenues, strengthen customer loyalty and improve
operational efficiency. In Latin America, Comverse has
operations in Argentina, Brazil and Mexico.
* * *
As reported in the Troubled Company Reporter on May 4, 2006,
Standard & Poor's Ratings Services held its ratings on Comverse
Technology Inc. on CreditWatch with negative implications, where
they were placed on March 15, 2006, on the disclosure that the
board of directors at Comverse had created a special committee
to review matters relating to the company's stock option grants
and the likely need to restate prior-period financial results.
As reported in the Troubled Company Reporter on March 17, 2006,
Standard & Poor's placed its corporate credit and senior
unsecured debt ratings on Comverse Technology on CreditWatch
with negative implications. The company has S&P's 'BB-'
corporate credit and senior unsecured debt ratings.
TAM SA: S&P Assigns BB Long-Term Corporate Credit Rating
--------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB' long-term
corporate credit rating to Brazil's largest airline, TAM S.A..
The outlook is stable.
"The ratings reflect TAM's exposure to the cyclical, price-
competitive, and capital-intensive airline industry, a somewhat
leveraged financial profile (despite recent improvement),
competition with low-cost carrier GOL Linhas Aereas Inteligentes
S.A. (GOL; unrated), some cost exposure to exchange risk and
volatile fuel prices, and dependence on the overall economic
environment in its home market of Brazil," said Standard &
Poor's credit analyst Reginaldo Takara.
These negatives are partly offset by:
-- TAM's sound market share and growing position in the
fairly concentrated Brazilian airline industry,
-- a business model based on product differentiation,
-- highly efficient and cost-competitive operations, and
-- the expectations that the company's financial profile
will continue improving in the medium term, while
sustaining strong liquidity.
TAM is today the largest airline in Brazil, with approximately
47.6% revenue passenger kilometers (RPK) market share and 45.8%
available seat kilometers (ASK) capacity share in June 2006.
The company also holds a 37.9% and 34.8% RPK and ASK market
share, respectively, among Brazilian carriers in international
flights as of June 2006. The Brazilian airline industry has
experienced significant growth in recent past (with ASK and RPK
expansion of 18.0% and 21.5%, respectively, in first-half 2006
compared with equal period of 2005), and TAM has strongly
benefited from this favorable environment, obtaining significant
performance improvement. Indeed, TAM's EBITDA, adjusted for
operating leases (OLA), margin improved to 18% in first-half
2006, compared with 12% in the same period of 2005. The company
has also managed to operate at unusually high load factors
(around 75% in June 2006) and longer block hours (currently
already at 12 hours) this year, due to both the strong demand
and the declining market position of competitor Varig S.A.
(unrated).
While market conditions point to a positive performance this
year and well into next, we highlight that domestic demand is
expected to remain volatile in the longer term, as air traffic
growth is correlated with economic activity.
Although Varig's market position deteriorated substantially due
to service interruptions in recent months, the company is
expected to restart regular flights to many of its existing
destinations soon. Under the control of new management, Varig
may well bring some competitive pressure in the medium term as
it eagerly seeks to reposition itself in the domestic market.
Still, we expect competition to be primarily centered in TAM and
GOL in the medium term. Varig's declining operation has also
opened several new opportunities in international routes to TAM,
but we believe the company will grow its long-haul operations
selectively in the next years.
TAM focuses on providing business travelers with high-quality
services such as convenient frequencies, a higher number of
nonstop flights, and flight amenities, allowing it to obtain
yields slightly better than those of competitors. Investments
in IT have reduced TAM's commercial expenses and enhanced market
intelligence. Although they are still higher than those of its
direct competitor GOL (who holds 32.5% RPK market share in June
2006), TAM's operating costs are competitive and have improved
substantially in the past two years due to an extensive
operating and financial restructuring. Standard & Poor's
believes the company will be successful in further narrowing
this cost gap in the future and expect the company's efficiency
measures to further improve, with a positive impact on cash
generation. Nevertheless, TAM's costs should remain exposed to
exchange volatility, as approximately 53% of its cash operating
costs are either referenced in dollars or dollar-denominated.
Therefore, foreign exchange volatility could potentially put
pressure on the company's financial profile if combined with
unfavorable market conditions in the future.
The stable outlook reflects Standard & Poor's opinion that TAM
will remain as a leading airline in Brazil even assuming a more
competitive environment. It also assumes that TAM's credit
measures will continue improving in the next years supported by
improving cash flows. The rating agency believes that the
company's fleet strategy is compatible with current positive
market trends in Brazil and that the company has flexibility to
adjust capacity if there is an unexpected downturn in the
future. It also expects TAM to grow its international routes
only selectively. The company's liquidity is expected to remain
strong to face potential volatility in the still-developing air
transport market in Brazil.
The ratings could face downward pressure if key performance
indicators deteriorate sequentially due to either fiercer
competition, operating difficulties, or market conditions.
Declining liquidity trends due to higher capital expenditures or
expanding fleet pointing to significant increase in OLA total
debt could also lead to a negative rating revision.
On the other hand, a positive revision of the ratings would
depend on a better definition of the competitive environment in
Brazil (in particular, the strategy and repositioning of Varig
after its reorganization). Sustained demand domestic growth,
allowing TAM to further strengthen its market leadership and
still improve credit measures from current levels, could also
lead to a positive rating revision.
===========================
C A Y M A N I S L A N D S
===========================
ASAKUSA: Creditors Have Until Sept. 7 to File Proofs of Claim
-------------------------------------------------------------
Asakusa's creditors are required to submit proofs of claim by
Sept. 7, 2006, to the company's liquidators:
John Cullinane
Derrie Boggess
c/o Walkers SPV Limited
P.O. Box 908, George Town
Grand Cayman, Cayman Islands
Tel: (345) 914-6305
Creditors who are not able to comply with the Sept. 7 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.
Asakusa's shareholders agreed on July 21, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.
BRIDGE INVESTMENT: Last Day to File Proofs of Claim Is Sept. 7
--------------------------------------------------------------
Bridge Investment Holding Limited's creditors are required to
submit proofs of claim by Sept. 7, 2006, to the company's
liquidators:
Ian Wight
Stuart Sybersma
Deloitte
P.O. Box 1787, George Town
Grand Cayman, Cayman Islands
Creditors who are not able to comply with the Sept. 7 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.
Bridge Investment's shareholders agreed on July 6, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.
Parties-in-interest may contact:
Nicole Ebanks
Deloitte
P.O. Box 1787, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7500
Fax: (345) 949-8258
CITRIX CAYMAN: Last Day for Proofs of Claim Filing Is on Sept. 7
----------------------------------------------------------------
Citrix Cayman Finance Group, Ltd.' creditors are required to
submit proofs of claim by Sept. 7, 2006, to the company's
liquidator:
Karen Leopardi
c/o Walkers
Walker House, P.O. Box 265 GT
Mary Street, George Town
Grand Cayman, Cayman Islands
Creditors who are not able to comply with the Sept. 7 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.
Citrix Cayman's shareholders agreed on July 15, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.
Parties-in-interest may contact:
Jonathan Culshaw
c/o Walkers
Walker House, P.O. Box 265 GT
Mary Street, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-6341
Fax: (345) 814-8341
DOLMEN LIMITED: Proofs of Claim Must be Submitted by Sept. 7
------------------------------------------------------------
Dolmen Limited's creditors are required to submit proofs of
claim by Sept. 7, 2006, to the company's liquidators:
Ogier Corporate Services (UK) Limited
Equitable House, 47 King William Street
London, EC4R 9JD
Creditors who are not able to comply with the Sept. 7 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.
Dolmen Limited's shareholders agreed on July 7, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.
ELECTROGUAYAS INC: Proofs of Claim Must be Filed by Sept. 7
-----------------------------------------------------------
Electroguayas Inc.'s creditors are required to submit proofs of
claim by Sept. 7, 2006, to the company's liquidators:
Q&H Nominees Ltd.
Third Floor, Harbour Centre
P.O. Box 1348, George Town
Grand Cayman, Cayman Islands
Creditors who are not able to comply with the Sept. 7 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.
Electroguayas Inc.'s shareholders agreed on July 7, 2006, for
the company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.
Parties-in-interest may contact:
Quin & Hampson
c/o P.O. Box 1348, George Town
Grand Cayman, Cayman Islands
Tel: (+1) 345 949 4123
Fax: (+1) 345 949 4647
LION1 LDC: Creditors Have Until Sept. 7 to File Proofs of Claim
---------------------------------------------------------------
Lion1 LDC's creditors are required to submit proofs of claim by
Sept. 7, 2006, to the company's liquidators:
John Cullinane
Derrie Boggess
c/o Walkers SPV Limited
P.O. Box 908, George Town
Grand Cayman, Cayman Islands
Tel: (345) 914-6305
Creditors who are not able to comply with the Sept. 7 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.
Lion1 LDC's shareholders agreed on July 19, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.
LION2 LDC: Deadline for Filing Proofs of Claim Is on Sept. 7
------------------------------------------------------------
Lion2 LDC's creditors are required to submit proofs of claim by
Sept. 7, 2006, to the company's liquidators:
John Cullinane
Derrie Boggess
c/o Walkers SPV Limited
P.O. Box 908, George Town
Grand Cayman, Cayman Islands
Tel: (345) 914-6305
Creditors who are not able to comply with the Sept. 7 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.
Lion2 LDC's shareholders agreed on July 19, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.
LION3 LDC: Creditors Must File Proofs of Claim by Sept. 7
---------------------------------------------------------
Lion3 LDC's creditors are required to submit proofs of claim by
Sept. 7, 2006, to the company's liquidators:
John Cullinane
Derrie Boggess
c/o Walkers SPV Limited
P.O. Box 908, George Town
Grand Cayman, Cayman Islands
Tel: (345) 914-6305
Creditors who are not able to comply with the Sept. 7 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.
Lion3 LDC's shareholders agreed on July 19, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.
LION4 LDC: Last Day to File Proofs of Claim Is Sept. 7
------------------------------------------------------
Lion4 LDC's creditors are required to submit proofs of claim by
Sept. 7, 2006, to the company's liquidators:
John Cullinane
Derrie Boggess
c/o Walkers SPV Limited
P.O. Box 908, George Town
Grand Cayman, Cayman Islands
Tel: (345) 914-6305
Creditors who are not able to comply with the Sept. 7 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.
Lion4 LDC's shareholders agreed on July 19, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.
LION5 LDC: Creditors Must Present Proofs of Claim by Sept. 7
------------------------------------------------------------
Lion5 LDC's creditors are required to submit proofs of claim by
Sept. 7, 2006, to the company's liquidators:
John Cullinane
Derrie Boggess
c/o Walkers SPV Limited
P.O. Box 908, George Town
Grand Cayman, Cayman Islands
Tel: (345) 914-6305
Creditors who are not able to comply with the Sept. 7 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.
Lion5 LDC's shareholders agreed on July 19, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.
NEWBRIDGE LIMITED: Proofs of Claim Must be Filed by Sept. 7
-----------------------------------------------------------
Newbridge Limited's creditors are required to submit proofs of
claim by Sept. 7, 2006, to the company's liquidators:
Ogier Employee Benefit Services Limited
Whiteley Chambers
Don Street, St Helier, Jersey JE4 9WG
Channel Islands
Creditors who are not able to comply with the Sept. 7 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.
Newbridge Limited's shareholders agreed on July 7, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.
NIELVAL LIMITED: Holding Final Shareholders Meeting on Aug. 29
--------------------------------------------------------------
Nielval Limited's shareholders will convene for a final meeting
at 10:00 a.m., on Aug. 29, 2006, at:
4th Floor FirstCaribbean House
Grand Cayman, Cayman Islands
Accounts on the company's liquidation process will be presented
during the meeting.
The liquidator can be reached at:
Condor Nominees Limited
c/o Barclays Private Bank & Trust (Cayman) Limited
4th Floor FirstCaribbean House
25 Main Street, George Town
Grand Cayman, Cayman Islands
ORACLE DELTA: Schedules Final Shareholders Meeting on Aug. 28
-------------------------------------------------------------
Oracle Delta Funding's final shareholders meeting will be at
10:00 a.m. on Aug. 28, 2006, at:
BNP Paribas Bank & Trust Cayman Limited
3rd Floor Royal Bank House
Shedden Road, George Town
Grand Cayman, Cayman Islands
These agenda will be taken during the meeting:
1) accounting of the liquidation process showing how the
winding up has been conducted during the preceding year,
2) requesting the members' approval of the liquidation fees
incurred to date, approval of the liquidator's estimated
costs to completion, and
3) hearing any explanation that may be given by the
liquidator.
A member entitled to attend and vote at the meeting may appoint
a proxy, who need not be a member, in his stead.
The liquidator can be reached at:
Picadilly Cayman Limited
Attn: Jonathan Dietz
c/o BNP Paribas Bank & Trust Cayman Limited
3rd Floor Royal Bank House
Shedden Road, George Town
Grand Cayman, Cayman Islands
Tel: 345 945-9208
Fax: 345 945-9210
QUICK ACCESS: Proofs of Claim Filing Deadline Is Set for Sept. 7
----------------------------------------------------------------
Quick Access International (Cayman) Limited's creditors are
required to submit proofs of claim by Sept. 7, 2006, to the
company's liquidator:
Q&H Nominees Ltd.
Third Floor, Harbour Centre
P.O. Box 1348, George Town
Grand Cayman, Cayman Islands
Creditors who are not able to comply with the Sept. 7 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.
Quick Access' shareholders agreed on June 30, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.
Parties-in-interest may contact:
Quin & Hampson
c/o P.O. Box 1348, George Town
Grand Cayman, Cayman Islands
Tel: (+1) 345 949 4123
Fax: (+1) 345 949 4647
SHACKLETON RE: AM Best Rates US$125MM Variable Notes at B+
----------------------------------------------------------
A.M. Best Co. has assigned a debt rating of "b+" to the US$125
million Principal-at-Risk Variable Rate Notes due Feb. 7, 2008,
issued by Shackleton Re Limited, a newly created Cayman Islands
exempted company licensed as a restricted Class B insurer. The
rating outlook is stable.
The primary business purpose for the creation of the issuer is
for the issuance of various types of debt and servicing and
performance of various agreements entered into, including the
reinsurance agreement and other related covenants.
Proceeds from the issuance of the notes will be deposited into a
collateral trust account and will be available to pay amounts
owed by the issuer. This includes:
-- amounts owed to the swap counterparty;
-- loss payments required to be made by the issuer under a
multi-year reinsurance agreement entered between the
issuer and Endurance Specialty Insurance Ltd. (Endurance)
(Bermuda) providing coverage for certain earthquakes
within the specific covered area; and
-- payments in respect of such notes under an indenture
between the issuer and JPMorgan Chase Bank, N.A.
The proceeds will be deposited into an eligible bank institution
that has a long-term deposit rating that meets or exceeds the
minimum pre-established rating threshold. The notes have
limited recourse to certain assets of the issuer and are without
recourse to the ceding insurer, Endurance. These loans further
strengthen Endurance's solid reinsurance program, although there
is basis risk associated with the transaction. The ratings of
the ceding insurer remain unchanged.
The assigned rating represents an opinion as to the issuer's
ability to meet its financial obligations to security holders
when due. The rating considers the probability of loss payments
made when an earthquake occurs within the applicable risk period
and has caused insured personal and commercial property losses
in the covered territories exceeding a stated threshold amount.
The annualized attachment probability of 2.07% was calculated
using RMS's Interim Catastrophe Model, which is based upon Risk
Linkr (RL) 5.0 with adjustments to approximate the results of
the recently released RL 6.0 model version.
In addition, the rating takes into consideration the
creditworthiness of Endurance, who under the reinsurance
agreement, is responsible for making periodic payments (premium
and expense reimbursements) to the issuer.
SHACKLETON RE: AM Best Assigns Low B Ratings on US$110MM Notes
--------------------------------------------------------------
A.M. Best Co. has assigned debt ratings to a US$110 million
Senior Secured Credit Facility due August 7, 2008, of Shackleton
Re Limited (the issuer), a newly created Cayman Islands exempted
company licensed as a restricted Class B insurer. The loan
consists of two tranches: US$60 million Tranche B Term Loan,
which is assigned a debt rating of "bb", and US$50 million
Tranche C Term Loan, which is assigned a debt rating of "bb+".
The outlook for both ratings is stable.
The primary business purpose for the creation of the issuer is
for the issuance of various types of debt and servicing and
performance of various agreements entered into, including the
reinsurance agreement, trust agreement and other related
covenants.
Proceeds from the issuance of the loans will be deposited into a
collateral trust account and will be available to pay amounts
owed by the issuer. This includes:
-- amounts owed to the swap counterparty;
-- loss payments required to be made by the issuer under a
multi-year reinsurance agreement entered into between the
issuer and Endurance Specialty Insurance Ltd. (Endurance)
(Bermuda) providing coverage for certain earthquakes
within the specific covered area; and
-- payments in respect of such loans under a credit agreement
among the issuer, various lenders and Goldman Sachs Credit
Partners L.P. (the credit agreement).
The proceeds will be deposited into an eligible bank institution
that has a long-term deposit rating that meets or exceeds the
minimum pre-established rating threshold. The loans have
limited recourse to certain assets of the issuer and are without
recourse to the ceding insurer, Endurance. These loans further
strengthen Endurance's solid reinsurance program, although there
is basis risk associated with the transaction. The ratings of
the ceding insurer remain unchanged.
The assigned debt ratings represent an opinion as to the
issuer's ability to meet its financial obligations to security
holders when due. The ratings consider the probability of loss
payments made when an earthquake occurs within the applicable
risk period and has caused insured personal and commercial
property losses in the covered territories exceeding a stated
threshold amount. The annualized attachment probability of
Tranche B Term Loan of 1.49% and Tranche C Term Loan of 0.96%
was calculated using RMS's Interim Catastrophe Model, which is
based upon Risk Linkr (RL) 5.0 with adjustments to approximate
the results of the recently released RL 6.0 model version.
In addition, the ratings take into consideration the
creditworthiness of Endurance, who under the reinsurance
agreement, is responsible for making periodic payments (premium
and expense reimbursements) to the issuer.
ZEST INVESTMENT: Filing of Proofs of Claim Is Until Sept. 7
-----------------------------------------------------------
Zest Investment VI's creditors are required to submit proofs of
claim by Sept. 7, 2006, to the company's liquidators:
Piccadilly Cayman Limited
c/o BNP Paribas Bank & Trust Cayman Limited
P.O. Box 10632 APO
Grand Cayman, Cayman Islands
Creditors who are not able to comply with the Sept. 7 deadline
won't receive any distribution that the liquidator will make.
Creditors are required to present proofs of claim personally or
through their solicitors.
Zest Investment's shareholders agreed on July 18, 2006, for the
company's voluntary liquidation under Section 135 of the
Companies Law (2004 Revision) of the Cayman Islands.
Parties-in-interest may contact:
Regina Forman
Darren Riley
3rd Floor Royal Bank House, George Town
Grand Cayman, Cayman Islands
Tel: 345 945-9208
Fax: 345 945-9210
=========
C H I L E
=========
ARAMARK CORP: Sales Up 5% to US$2.93 Bil. in Third Quarter 2006
---------------------------------------------------------------
ARAMARK Corp. reported sales of US$2.93 billion for the third
quarter of 2006, up 5% from the prior quarter. Organic sales
growth was 5%.
Net income for the quarter was US$35.0 million and diluted
earnings per share were US$0.19. These results reflect a
previously announced US$0.15 per share charge related to
goodwill impairment and adjustments to asset and liability
carrying values in the company's Uniform and Career Apparel -
Direct Marketing segment.
Year-to-Date Results
Sales for the first nine months of the 2006 fiscal year
increased 6% to US$8.69 billion. Net income was US$186.7
million and diluted earnings per share were US$1.01.
"While we faced some challenges this quarter, we are taking
aggressive steps to improve the performance of our uniform
direct marketing business," said Joseph Neubauer, Chairman and
Chief Executive Officer of ARAMARK. "We continue to execute
against our long-term vision for the company, and we are
optimistic about future performance."
Third-Quarter Results
In the Food and Support Services -- U.S. segment, sales
increased 3% from the prior year quarter to US$1.9 billion.
Organic sales growth was 4%. Segment operating income of US$88.7
million was negatively affected by costs associated with two
previously announced client contract terminations.
New business wins in the quarter included:
-- Cable News Network (CNN),
-- St. Bonaventure University,
-- Johns Hopkins University, and
-- Saint Thomas Health System.
Sales in the Food and Support Services -- International segment
grew 11% to US$661 million. Organic sales growth was 7%.
Segment operating income rose sharply from the prior year to
US$30.5 million.
New business wins in the quarter included Bentley Motors and
Stratford-upon-Avon College in the U.K.
In the Uniform and Career Apparel -- Rental segment, sales
increased 7% to US$301 million, with organic growth of 5%.
Segment operating income increased 9 % to US$34.2 million.
Sales in the Uniform and Career Apparel -- Direct Marketing
segment were US$97 million. The segment reported an operating
loss of US$46 million which includes a non-cash charge of
US$35.0 million for the writedown of goodwill and approximately
US$8.0 million for adjustments to asset and liability carrying
values.
Guidance
While the company remains confident about its future prospects,
in light of the announcement made on August 8, 2006, regarding
the signed definitive merger agreement, ARAMARK is no longer
providing financial guidance and is withdrawing its previous
guidance for 2006.
Aramark Corporation And Subsidiaries
Condensed Consolidated Statements Of Income
(Unaudited)
(US Dollar In Thousands, Except Per Share Amounts)
Three Months Ended
June 30, 2006 July 1, 2005
------------- -------------
Sales $2,933,638 $2,792,366
------------- -------------
Costs and Expenses:
Cost of services provided 2,676,846 2,532,145
Depreciation and amortization 85,542 79,410
Selling and general
corporate expenses 44,152 36,879
Goodwill impairment 35,000 -
------------- -------------
2,841,540 2,648,434
------------- -------------
Operating income 92,098 143,932
Interest and other
financing costs, net 36,382 32,222
------------- -------------
Income before income taxes 55,716 111,710
Provision for income taxes 20,733 40,327
------------- -------------
Net income $34,983 $71,383
============= =============
Earnings Per Share:
Basic $0.19 $0.38
Diluted $0.19 $0.38
Weighted Average Shares Outstanding:
Basic 182,756 186,264
Diluted 185,023 188,078
Aramark Corporation And Subsidiaries
Condensed Consolidated Statements Of Income
(Unaudited)
(In Thousands, Except Per Share Amounts)
Nine Months Ended
June 30, 2006 July 1, 2005
------------- -------------
Sales $8,689,061 $8,181,741
------------- -------------
Costs and Expenses:
Cost of services provided 7,898,818 7,434,734
Depreciation and amortization 251,053 235,962
Selling and general
corporate expenses 129,884 107,267
Goodwill impairment 35,000 -
------------- -------------
8,314,755 7,777,963
------------- -------------
Operating income 374,306 403,778
Interest and other
financing costs, net 105,543 96,857
------------- -------------
Income before income taxes 268,763 306,921
Provision for income taxes 82,028 109,998
------------- -------------
Net income $186,735 $196,923
============= =============
Earnings Per Share:
Basic $1.02 $1.06
Diluted $1.01 $1.04
Weighted Average Shares Outstanding:
Basic 183,306 186,425
Diluted 185,292 188,837
Aramark Corporation And Subsidiaries
Selected Consolidated Balance Sheet Data
(Unaudited)
(In Thousands)
June 30, September 30,
2006 2005
------------ -------------
Assets
Current Assets $1,495,068 $1,443,227
Property and Equipment, net 1,187,991 1,211,454
Goodwill 1,734,971 1,682,749
Other Assets 797,554 819,670
------------ -------------
$5,215,584 $5,157,100
============ =============
Liabilities and Shareholders' Equity
Current Liabilities $1,415,775 $1,518,680
Long-Term Borrowings 1,949,677 1,794,522
Other Liabilities 387,551 518,434
Total Shareholders' Equity 1,462,581 1,325,464
------------ -------------
$5,215,584 $5,157,100
============ =============
About ARAMARK
Headquartered in Philadelphia, ARAMARK Corp. --
http://www.aramark.com/-- is a leader in professional services,
providing food services, facilities management, and uniform and
career apparel to health care institutions, universities and
school districts, stadiums and arenas, and businesses around the
world. It has approximately 240,000 employees serving clients
in 20 countries, including Mexico, Brazil and Chile.
* * *
Standard & Poor's Ratings Services lowered on Aug. 8, 2006, its
ratings on Philadelphia-based ARAMARK Corp. and its subsidiary,
ARAMARK Services Inc., including its corporate credit rating to
'BB+' from 'BBB-'.
Fitch has downgraded on Aug. 8, 2006, the Issuer Default Rating
and senior unsecured debt ratings for both ARAMARK Corporation
and its wholly owned subsidiary, ARAMARK Services, Inc., to 'BB-
' from 'BBB'. The ratings remain on Rating Watch Negative.
MILLIPORE CORP: Earns US$29.1 Million in Quarter Ended July 1
-----------------------------------------------------------
Millipore Corp.'s revenues for the second quarter ended
July 1, 2006, grew 12% to US$273.8 million. Changes in foreign
exchange rates during the quarter had no impact on total revenue
growth. Millipore's Bioprocess Division grew 13% in the second
quarter and its Bioscience Division grew 10%. Excluding the
impact of acquisitions, revenue growth in the second quarter was
8%.
Millipore reported second quarter net income of US$29.1 million,
compared to net income of US$24 million in the second quarter of
2005. Non-GAAP net income grew approximately 28% in the second
quarter totaling US$38.9 million, compared to non-GAAP net
income of US$30.3 million in the second quarter of 2005.
"During the second quarter, our Bioscience Division continued to
accelerate its performance due to improved execution and growth
in international markets," said Martin Madaus, Chairman & CEO of
Millipore. "The momentum of our Bioscience business is
complementing the performance of our Bioprocess business, which
is delivering solid growth due to the attractive fundamentals of
the biopharmaceutical manufacturing market. Over the long-term,
this balanced growth profile will help us to generate consistent
results and drive higher levels of earnings and cash flow.
"In addition to the strong quarterly performance of both of our
divisions, our global supply chain initiatives contributed
significantly to the 130 basis points of improvement in our
non-GAAP gross profit margins and is ahead of schedule. We
closed one facility in the second quarter and have transferred
36 product lines since we began this project. We are now at the
mid-point of this program and we anticipate generating higher
gross profit margins over the next three years."
Millipore completed its previously announced acquisition of
Serologicals Corp. on July 14, 2006, shortly after the close of
the second quarter. With the addition of Serologicals'
differentiated products, the Company will have a broad portfolio
of high-margin consumable products to generate growth in
revenues and profitability.
Madaus added, "We are excited about the talent and
differentiated product lines we are acquiring from Serologicals.
We expect to build on our recent momentum by combining their
products with our strong global sales organization. This
combination will enable us to increase our market penetration in
dynamic segments, such as cell culture supplements, nuclear
function, and stem cell research."
Second Quarter Highlights:
-- Significant growth of the Company's laboratory water
products and services in all geographic regions
-- Strong growth in new Bioprocess products, including
disposable technologies and virus filters
-- Solid, balanced growth in Europe and the Americas
-- GAAP earnings per share increase of 14%; Non-GAAP
earnings per share increase of 20%
Headquartered in Billerica, Massachusetts, Millipore Corp., is a
bioprocess and bioscience products and services company. The
Bioprocess division offers solutions that optimize development
and manufacturing of biologics. The Bioscience division
provides high performance products and application insights that
improve laboratory productivity. The company has presence in 18
Latin American countries including Chile, El Salvador and
Trinidad and Tobago.
* * *
As reported in the Troubled Company Reporter on July 19, 2006,
Moody's Investors Service downgraded the credit ratings of
Millipore Corporation. The rating action concluded a rating
review for possible downgrade initiated on April 27, 2006
following the announcement by Millipore that it entered into a
definitive agreement to acquire all of the outstanding shares of
Serologicals Corporation for US$1.4 billion, including the
assumption of about US$100 million in Serologicals' debt.
The Baa3 rating on the Company's US$100 million senior unsecured
notes, due 2007, was lowered to Ba2. The (P)Baa3 rating on the
US$300 Million Shelf Registration was also lowered to (P)Ba2.
In addition Moody's assigned a Ba1 Corporate Family Rating to
the Company.
SHAW GROUP: Secures US$250MM Tech Assistance Contract from FEMA
---------------------------------------------------------------
The Shaw Group Inc. disclosed its Environmental & Infrastructure
business unit has been awarded an Individual Assistance
Technical Assistance Contract (IA-TAC) by the Federal Emergency
Management Agency or FEMA. The US$250 million indefinite
delivery/indefinite quantity (ID/IQ) contract will be in effect
over a 2-year period starting in August 2006. The IA-TAC, which
was awarded through a full and open competitive process, is
intended to support FEMA's implementation of the Agency's
Individual Assistance programs.
The work to be performed would include consulting, technical,
and project management services in response to small, mid-size,
large, and catastrophic disasters in the United States.
Specific tasks would include site assessments, inspections,
planning, staging operations, design, construction,
installation, and maintenance of temporary housing areas. The
scope of services would also include the establishment and
operation of a disaster-specific, toll-free call center and
supporting other FEMA disaster operations.
Shaw will support FEMA's ability to care for disaster victims,
providing immediate relief to those in need of basic life
support including food, shelter, and medical attention. Under
this contract, the Shaw team is prepared to support multiple,
concurrent, and simultaneous tasks, nationwide with local
workforce and small business support in the affected areas.
The new IA-TAC program includes expedited task order
finalization procedures, which should provide for improved task
order, documentation and payment processes, to allow Shaw and
FEMA to better assist individuals and communities in need.
J.M. Bernhard, Jr., Chairman and Chief Executive Officer of
Shaw, said, "I have never been more proud of the Shaw team than
I was this past hurricane season when Shaw employees worked
tirelessly in relief and response efforts to Hurricanes Katrina,
Rita and Wilma. A large part of that work was our IA-TAC tasks
to provide quality temporary housing for displaced persons. That
mission is ongoing even as we put in place this new contract
which covers the next two years."
Mr. Bernhard continued, "We are very pleased to continue our
work with FEMA and excited about the opportunity to build upon
our past successes and support FEMA's mission going forward. We
are confident that with FEMA's new contracting program and the
lessons learned from our past projects, FEMA and Shaw are even
better positioned to respond and perform when another crisis
situation occurs."
About Shaw Group
The Shaw Group Inc. -- http://www.shawgrp.com/-- is a leading
global provider of technology, engineering, procurement,
construction, maintenance, fabrication, manufacturing,
consulting, remediation, and facilities management services for
government and private sector clients in the energy, chemical,
environmental, infrastructure and emergency response markets.
Headquartered in Baton Rouge, Louisiana, with over US$3 billion
in annual revenues, Shaw employs approximately 20,000 people at
its offices and operations in Venezuela, Chile, North America,
Europe, the Middle East and the Asia-Pacific region.
On July 27, 2005, Shaw Group was assigned a BB rating by
Standard & Poor's.
===============
C O L O M B I A
===============
DIGICEL LTD: Qualifies to Bid for Ola Stake
-------------------------------------------
Reports in Colombian press say Digicel Ltd. has qualified as a
candidate to make a bid for a stake in Ola.
Business News Americas relates that local municipal telcos
Empresa de Telefono de Bogota and Empresas Publicas de Medellin
plan to sell 50% and one share of Ola. Digicel will have to
compete with Millicom International Cellular for that stake.
As reported in the Troubled Company Reporter-Latin America on
July 12, 2006, Millicom -- along with Digicel and Entel PCS
-- was vying to be a strategic partner of Ola, who would declare
the winner on Aug. 3. Millicom, Digicel and Entel received an
invitation from Empresa de Telefono de Bogota and Empresas
Publicas de Medellin to participate in the second stage of the
process.
However, BNamericas reports that Entel PCS has backed out of the
bidding.
The report also states that Empresa de Telefono de Bogota and
Empresas Publicas de Medellin will hold the auction on Aug. 31.
Empresa de Telefono de Bogota and Empresas Publicas de Medellin
will revise the bidding rules if the candidates qualify as
bidders, BNamericas notes. The definitive draft, which the
candidates may study until Aug. 28 before confirming that they
will bid, will be published on Aug. 18.
Empresa de Telefono de Bogota and Empresas Publicas de Medellin
will disclose the minimum bid for Ola on Aug. 28, BNamericas
states.
About Millicom
Millicom International Cellular S.A. -- http://www.millicom.com/
-- is a global telecommunications investor with cellular
operations in Asia, Latin America and Africa. It currently has
cellular operations and licenses in 16 countries. The Group's
cellular operations have a combined population under license of
approximately 391 million people.
The Central America Cluster comprises Millicom's operations in
El Salvador, Guatemala and Honduras. The population under
license in Central America at December 2005 is 26.4 million.
The South America Cluster comprises Millicom's operations in
Bolivia and Paraguay. The population under license in South
America at December 2005 is 15.2 million.
About Digicel
Digicel Limited is a wireless services provider in the Caribbean
region founded in 2000, and controlled by Denis O'Brien. The
company started operations in Jamaica in April 2001 and now
offers GSM mobile services in 13 countries of the Caribbean
including Jamaica, St. Lucia, St. Vincent, Aruba, Grenada,
Barbados, Cayman, and Curacao among others. Digicel finished
FY2005 with 1.722 million total subscribers -- 97% pre-paid --
estimated market share of 67% and revenues and EBITDA of US$478
million and US$155 million, respectively.
* * *
On July 12, 2006, Moody's Investors Service assigned a B3 senior
unsecured rating to the US$150 million add-on Notes offering of
Digicel Limited and affirmed Digicel's existing B3 senior
unsecured and B1 Corporate Family Ratings. The outlook has been
changed to stable from positive.
Fitch Ratings assigned on July 14, 2006, a 'B' rating to Digicel
Limited's proposed add-on offering of US$150 million 9.25%
senior notes due 2012. These notes are an extension of the
US$300 million notes issued in July 2005. In addition, Fitch
also affirms Digicel's foreign currency Issuer Default Rating
and the existing US$300 million senior notes due 2012 at 'B'.
Fitch said the Rating Outlook is Stable.
MILLICOM INTERNATONAL: Qualifies to Bid for Ola Stake
-----------------------------------------------------
Reports in Colombian press say Millicom International Cellular
has qualified as a candidate to make a bid for a stake in Ola.
According to published reports, local municipal telcos Empresa
de Telefono de Bogota and Empresas Publicas de Medellin plan to
sell 50% and one share of Ola. Millicom will have to compete
with Digicel Ltd. for that stake.
As reported in the Troubled Company Reporter-Latin America on
July 12, 2006, Millicom -- along with Digicel and Entel PCS
-- was vying to be a strategic partner of Ola, who would declare
the winner on Aug. 3. Millicom, Digicel and Entel received an
invitation from Empresa de Telefono de Bogota and Empresas
Publicas de Medellin to participate in the second stage of the
process.
However, BNamericas reports that Entel PCS has backed out of the
bidding.
The report also states that Empresa de Telefono de Bogota and
Empresas Publicas de Medellin will hold the auction on Aug. 31.
Empresa de Telefono de Bogota and Empresas Publicas de Medellin
will revise the bidding rules if the candidates qualify as
bidders, BNamericas notes. The definitive draft, which the
candidates may study until Aug. 28 before confirming that they
will bid, will be published on Aug. 18.
Empresa de Telefono de Bogota and Empresas Publicas de Medellin
will disclose the minimum bid for Ola on Aug. 28, BNamericas
states.
About Digicel
Digicel Limited is a wireless services provider in the Caribbean
region founded in 2000, and controlled by Denis O'Brien. The
company started operations in Jamaica in April 2001 and now
offers GSM mobile services in 13 countries of the Caribbean
including Jamaica, St. Lucia, St. Vincent, Aruba, Grenada,
Barbados, Cayman, and Curacao among others. Digicel finished
FY2005 with 1.722 million total subscribers -- 97% pre-paid --
estimated market share of 67% and revenues and EBITDA of US$478
million and US$155 million, respectively.
About Millicom
Millicom International Cellular S.A. -- http://www.millicom.com/
-- is a global telecommunications investor with cellular
operations in Asia, Latin America and Africa. It currently has
cellular operations and licenses in 16 countries. The Group's
cellular operations have a combined population under license of
approximately 391 million people.
The Central America Cluster comprises Millicom's operations in
El Salvador, Guatemala and Honduras. The population under
license in Central America at December 2005 is 26.4 million.
The South America Cluster comprises Millicom's operations in
Bolivia and Paraguay. The population under license in South
America at December 2005 is 15.2 million.
* * *
Millicom International's 10% senior notes due 2013 carry Moody's
B3 rating and Standard & Poor's B- rating.
* * *
Standard & Poor's Ratings Services affirmed on July 4, 2006, its
'B+' long-term corporate credit and 'B-' senior unsecured debt
ratings on Millicom International Cellular S.A. The ratings
were removed from CreditWatch with developing implications,
where they had been placed on Jan. 20, 2006, on the initiation
of a strategic review that could have led to a transaction such
as the sale of all or part of the company. The outlook is
stable.
===================
C O S T A R I C A
===================
BANCO BANEX: Posts CRC4.25 Billion First Half 2006 Profits
----------------------------------------------------------
Figures from Sugef -- Costa Rica's financial sector regulator --
show that the earnings of Banco Banex increased 17.5% to CRC4.25
billion in the first half of 2006, compared with the CRC3.62
billion recorded in the same period of 2005, Business News
Americas reports.
Banco Banex posted these results in the first half of 2006:
-- net interest income increased 38% to CRC9.74 billion,
compared to the first half of 2005;
-- net fee revenues rose 34% to CRC2.44 billion;
-- administrative costs increased 29% to CRC6.76 billion in
the first half over the same period in 2005;
-- performing loans grew 26% to CRC267 billion at the end of
the June 2006, compared with June 2005;
-- financial investments decreased 2% to CRC32.1 billion;
-- assets rose 25% to CRC385 billion at the end of the June
2006 compared with June 2005;
-- interest bearing liabilities grew 23% to CRC300 billion
at the end of June 2006, compared with the same period in
2005;
-- non-interest bearing liabilities increased 38% to CRC44.7
billion;
-- shareholder equity rose 26% to CRC40.4 billion in June
2006, compared with June 2005; and
-- market share as of June 30, 2006, was 8.3%.
Banco Banex is a subsidiary of Grupo Financiero Banex -- the
fifth largest financial group in Costa Rica. Panama's Grupo
Banistmo currently controls Banex.
* * *
As reported in the Troubled Company Reporter-Latin America on
July 4, 2005, Moody's Investors Service upgraded the long term
foreign currency deposit rating to Caa1 from Caa2 for Banco
Banex S.A. following Moody's upgrade of Argentina's foreign
currency ceiling for bank deposits to Caa1. Moody's also raised
the bank's National Scale foreign currency deposit rating to
Ba1.ar from B1.ar. All the ratings have a stable outlook.
* * *
As reported in the Troubled Company Reporter-Latin America on
June 2, 2006, Moody's Investors Service upgraded the bank
financial strength rating of Banco Banex S.A. to E+ from E. The
outlook on this rating is stable.
=======
C U B A
=======
* CUBA: Inks Cooperation Accord with Uruguay
--------------------------------------------
Cuba's Chamber of Commerce signed a cooperation pact with
Uruguay's Managerial Chamber of Maldonado province, Prensa
Latina reports.
The accord, the same report says, is aimed at encouraging
relations between parties.
The agreement was a result of negotiations the Cuban Chamber of
Commerce organized, Juan Pigola, the chairperson of the
Maldonado Managerial Chamber, told the local press.
Mr. Pigola said that the initiative was considered interesting
by Maldonado's entrepreneurs, as it was the first time in 20
years that an institution in Uruguay was invited to participate
in this kind of negotiation, Prensa Latina states.
* * *
Moody's assigned these ratings to 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
===================================
D O M I N I C A N R E P U B L I C
===================================
BANCO INTERCONTINENTAL: Lois Malkun Defends Former President
------------------------------------------------------------
Jose Lois Malkun, the former head of the Dominican Republic's
central bank, said Hipolito Mejia, the nation's former
president, was innocent in the collapse of Banco
Intercontinental SA aka Baninter, Dominican Today reports.
As reported in the Troubled Company Reporter-Latin America on
July 5, 2006, Mr. Mejia had been subpoenaed to testify in the
Baninter fraud case. Marino Vinicio Castillo, the Dominican
Republic's presidential adviser on narcotics topics, had said
that the former president had signed papers that would implicate
him in the case. The documents were kept as evidence.
According to Mr. Castillo, Mr. Mejia had threatened to use a
"trump card" against Leonel Fernandez when the latter was yet a
candidate and had said that by April 2004 Fernandez's candidacy
would disappear. However, there was no basis to the allegation
so the threat did not materialize, Mr. Castillo said.
Dominican Today relates that Mr. Malkun defended Mr. Mejia's
actions regarding the illicit payment to depositors during
Baninter's liquidation.
Liquidations were done based on the Monetary Board's decision,
so it was an institutional decision. The nation's payment
capacity was at stake, Dominican Today says, citing Mr. Malkun.
Mr. Malkun told Dominican Today, "I do not regret the
liquidations of the Intercontinental Bank, if I had to do it
again, I would do so without any problem."
According to Dominican Today, Mr. Malkun underwent an
interrogation by assistant prosecutors Francisco Polanco and
Luis Gonzalez, regarding an accusation from Ramon Baez Figueroa
-- the former head of Baninter -- that the former central bank
governor violated the Monetary and Financial Law.
As reported in the Troubled Company Reporter-Latin America on
July 11, 2006, Mr. Figueroa filed charges against Mr. Malkun
before Jose Manuel Hernandez -- the National District
prosecutor. In his suit, Mr. Figueroa alleged that Mr. Malkun
violated the Monetary and Financial Law 183-02 of the Dominican
Republic when the latter transferred more than DOP40 billion
from Baninter under his safekeeping without complying with the
due process. Mr. Figueroa's lawyers said that the charges
involve legal serious consequences with the blatant violation of
the Monetary and Financial Law by Mr. Malkun when the latter
ordered paying all deposits in Baninter and the Baninter Trust,
in excess of the DOP500,000 limit that the law has established.
Mr. Figueroa said he decided to press charges as a citizen and
because -- in addition to the quasi-fiscal deficit of DOP55
billon -- he is being pointed as the one that caused the
Baninter conflict. Mr. Figueroa is represented by:
-- Marino Vinicio Castillo (Vincho),
-- Juarez Castillo, and
-- Vinicio Castillo.
Dominican Today underscores that Mr. Malkun filed a challenge to
the charges on Wednesday morning, saying that several articles
of the Penal Procedural Code were violated in the complaint
against him.
The National District Prosecutor's Office set an interrogation
of Mr. Malkun on Aug. 9, Dominican Today states.
BanInter collapsed in 2003 as a result of massive fraud
that drained it of about US$657 million in funds. As a
consequence, all of its branches were closed. The bank's
current and savings accounts holders were transferred to the
bank's new owner -- Scotiabank. The bankruptcy of Baninter was
considered the largest in world history, in relation to the
Dominican Republic's Gross Domestic Product. It cost Dominican
taxpayers DOP55 billion and resulted to the country's worst
economic crisis.
FALCONBRIDGE LTD: Meets Conditions on Offer to Acquire Novicourt
----------------------------------------------------------------
Falconbridge Limited disclosed that it has met all of the
conditions set out for its offer dated June 26, 2006, to
purchase all of the outstanding common shares of its subsidiary
Novicourt Inc. that it does not already own.
A total of 5,068,720 Novicourt Shares, representing
approximately 66.5% of all Novicourt Shares that were not
already owned by Falconbridge, were tendered to the Offer.
Accordingly, Falconbridge has taken up and intends to pay for
all Novicourt Shares deposited under the Offer on Aug. 14, 2006.
Falconbridge has granted additional time to Novicourt
shareholders who have not yet tendered their Novicourt Shares,
by extending its offer to 6:00 p.m. (Toronto time) on
Aug. 22, 2006. Falconbridge intends to acquire all outstanding
Novicourt Shares not tendered by that date pursuant to rights of
compulsory acquisition, if available, or pursuant to a
subsequent acquisition transaction, with the result that
Novicourt will become a wholly-owned subsidiary of Falconbridge.
About Falconbridge
Headquartered in Toronto, Ontario, Falconbridge Limited
(TSX:FAL.LV)(NYSE: FAL) -- http://www.falconbridge.com/-- is a
leading copper and nickel company with investments in fully
integrated zinc and aluminum assets. Its primary focus is the
identification and development of world-class copper and nickel
orebodies. It employs 14,500 people at its operations and
offices in 18 countries. The Company owns nickel mines in
Canada and the Dominican Republic and operates a refinery and
sulfuric acid plant in Norway. It is also a major producer of
copper (38% of sales) through its Kidd mine in Canada and its
stake in Chile's Collahuasi mine and Lomas Bayas mine. Its
other products include cobalt, platinum group metals, and zinc.
* * *
Falconbridge's CDN$150 million 5% convertible and callable
bonds due April 30, 2007, carry Standard & Poor's BB+ rating.
FALCONBRIDGE LTD: To Make Major Investment in Raglan Nickel Mine
----------------------------------------------------------------
Falconbridge Ltd. disclosed a major investment program for its
nickel installations in Northern Quebec, at the Raglan Mine in
Nunavik Territory. The announcement was made in the presence of
Quebec Premier Jean Charest and the Minister of Natural
Resources and Fauna Pierre Corbeil.
Falconbridge disclosed the launch of two important studies for
the Raglan Mine expansion. The first will focus on developing
new ore reserves to replace those depleted since the mine's
opening in 1997. This investment will likely reach nearly
CDN$240 million over six years.
The second study is to support the expansion of nickel ore
production from one million tons per year to 1.3 million tons as
early as 2009. This 30% increase, requiring an additional
investment of roughly CDN$250 million, would create 50
additional jobs and increase the value of annual royalties
Falconbridge pays to local Inuit communities. On April 7, 2006,
Falconbridge presented a CDN$9.3 million check to the Makivik
Corporation covering the payment of the first royalties as part
of the Raglan Agreement.
This amount is in addition to the nearly CDN$200 million in
equipment and upgrades Falconbridge has invested at the Raglan
Mine in the past two years. The initial investment in the
construction of Raglan was in excess of US$600 million.
Falconbridge also reported the start of major renovations to its
Deception Bay loading dock. The CDN$50 million investment will
extend the dock's service life and support the production
increases.
"These studies will enable the Raglan Mine to expand production
while maintaining the flow of benefits to local Inuit
communities, and also respecting the environment", stated Ian
Pearce, Chief Operating Officer of Falconbridge. "Falconbridge
has strong roots in the immense Abitibi-Temiscamingue region of
Quebec, through its predecessor company Noranda. Over the past
75 years we have made every effort to combine economic and
community benefits in all our projects, while continuously
improving our environmental performance. In recent years,
Quebec has demonstrated its unequivocal support for the mining
sector and is today one of the world's most attractive
jurisdictions for our industry."
Inaugurated in 1997, the Falconbridge nickel mining camp at
Raglan comprises three underground mines, one open-pit mine, as
well as a concentrator. The site enjoys year-round road
connections to a landing strip at Donaldson and to harbor
facilities at Deception Bay. Ore from the mine is crushed,
ground and processed into nickel-copper concentrate at the
Raglan plant.
About Falconbridge
Headquartered in Toronto, Ontario, Falconbridge Limited
(TSX:FAL.LV)(NYSE: FAL) -- http://www.falconbridge.com/-- is a
leading copper and nickel company with investments in fully
integrated zinc and aluminum assets. Its primary focus is the
identification and development of world-class copper and nickel
orebodies. It employs 14,500 people at its operations and
offices in 18 countries. The Company owns nickel mines in
Canada and the Dominican Republic and operates a refinery and
sulfuric acid plant in Norway. It is also a major producer of
copper (38% of sales) through its Kidd mine in Canada and its
stake in Chile's Collahuasi mine and Lomas Bayas mine. Its
other products include cobalt, platinum group metals, and zinc.
* * *
Falconbridge's CDN$150 million 5% convertible and callable
bonds due April 30, 2007, carry Standard & Poor's BB+ rating.
=============
E C U A D O R
=============
* ECUADOR: Strengthens Economic Ties with Chile
-----------------------------------------------
Ecuador has strengthened economic relations with Chile, Prensa
Latina reports.
Prensa Latina relates that Ecuador's President Alfredo Palacio
signed early this week a "joint declaration of 25 points" with
Michelle Bachelet, his Chilean counterpart, in the Carindolet
Palace of Ecuador.
The document the two leaders signed highlighted Chile's interest
in being an associated member of the Community of Andean Nations
as well as Ecuador's integration to the Forum of the Economic
Council Asia-Pacific, Prensa Latina states.
According to the report, another important point in the join
declaration is the signing of the seventh and eighth additional
protocols of the Economic Complementation Agreement.
Prensa Latina underscores that Petroecuador -- the Ecuadorian
state-run oil company -- also entered a trade cooperation accord
with Chile's state-owned Enap, having about 60 days to initiate
talks on the oil sector.
Chile has invested more than US$100 million in Ecuador's energy
exploitation, President Bachelet told Prensa Latina.
* * *
Fitch assigned these ratings on Ecuador:
Rating Rating Date
------ -----------
Country Ceiling B- Aug. 29, 2005
Long Term IDR B- Dec. 14, 2005
Short Term IDR B Dec. 14, 2005
=====================
E L S A L V A D O R
=====================
CHOICE HOTELS: June 30 Balance Sheet Upside-Down by US$118 Mil.
---------------------------------------------------------------
For the second quarter of 2006, Choice Hotels International Inc.
reported net income of US$24.1 million, a 12% increase compared
with US$21.5 million in the second quarter of 2005.
The Company's operating income increased 13% to US$42.1 million,
compared to US$37.4 million for the same period in 2005. Total
revenues increased 15% to US$140.5 million compared to the
second quarter of 2005.
Choice Hotels' balance sheet at June 30, 2006, showed total
shareholders' deficit of US$118.023 million resulting from total
assets of US$280.276 million and total liabilities of
US$398.299 million.
The Company's balance sheet also showed strained liquidity with
US$71,730,000 in total current assets and US$129,507,000 in
total current liabilities.
Commenting on the results, Charles A. Ledsinger, Jr., the
Company's president and chief executive officer, said "[w]e
continue to focus on brand enhancements and are seeing strong
growth in occupancy, average daily rate and RevPAR. We are
pleased with the substantial increase in year-to-date sales of
our new construction brands, most notably with our Cambria
Suites and Comfort Suites offerings."
"We believe that the inherent strength of our business model,
the ongoing improvements to our core brands, and the expansion
of our newest brands will enable us to drive top-line and
bottom-line growth in a variety of economic cycles," Mr.
Ledsinger added. "We are very pleased with the 13 percent
increase in EBITDA over the prior year's second quarter and
remain confident about the company's long-term prospects."
Choice Hotels International -- http://www.choicehotels.com/--
franchises more than 5,200 hotels, representing more than
430,000 rooms, in the United States and more than 40 countries
and territories. The company has hotels in Brazil, Costa Rica,
El Salvador, Guatemala and Honduras.
* EL SALVADOR: Good Market Condition Cues S&P to Affirm Ratings
---------------------------------------------------------------
Standard & Poor's ratings services affirmed its 'BB+' long-term
and 'B' short-term sovereign credit rating on the Republic of El
Salvador. The outlook remains stable.
According to Standard & Poor's credit analyst Roberto Sifon
Arevalo, the ratings reflect a stable monetary environment
created by the 2001 adoption of the U.S. dollar as the local
currency, an improving economic performance, and growing flows
of workers' remittances that reached 17% GDP in 2005.
"Economic performance was better than we expected in 2005, a
positive change from the sluggish performance of the last five
years," said Mr. Sifon Arevalo. "Real GDP grew at about 2.8% in
2005 and is expected to grow at 3.5% in 2006," he added.
Mr. Sifon-Arevalo also said that the quick passage of
legislation that allowed El Salvador to be the first country to
implement the Dominican Republic and Central America Free Trade
Agreement will probably be key in its capitalizing on this
agreement.
However, despite efforts to rationalize government operations,
El Salvador's narrow tax base has resulted in relatively high
deficits for a fully dollarized economy. El Salvador's general
government deficit, which totaled 3% of GDP in 2005, is
projected at the same level in 2006. Mr. Sifon Arevalo said
that this fiscal outcome continues to constrain fiscal
flexibility and the country's creditworthiness.
Standard & Poor's said that the government tax package passed in
early 2005 increased tax revenue by about 0.9% of GDP, although
this increase was offset by growing pension payments of about 2%
of GDP and by reconstruction efforts in the wake of Hurricane
Stan.
"The stable outlook on El Salvador's ratings balances Standard &
Poor's expectations that the deficit will not deteriorate and
that economic performance will accelerate as a result of DR-
CAFTA," Mr. Sifon Arevalo noted. "However, if the fiscal
performance deteriorates and growth reverses its positive
momentum the ratings could come under downward pressure," he
concluded.
=================
G U A T E M A L A
=================
PERKINELMER INC: Earns US$35.7 Million in Quarter Ended July 2
------------------------------------------------------------
PerkinElmer, Inc., generated revenues of US$377 million for the
second quarter ended July 2, 2006. Second quarter 2006 revenue
of US$377 million increased 2% over the second quarter of 2005.
Revenue growth was 3% in Life and Analytical Sciences and 1% in
Optoelectronics compared to the same period last year. Second
quarter 2006 revenue from Health Sciences end markets,
representing 83% of total revenues for the quarter, increased 3%
over the same period of 2005, while second quarter revenue from
Photonics end markets increased 1% over the same period.
GAAP operating profit during the second quarter of 2006 was
US$35.7 million, while GAAP operating margin for the same period
was 9.5%. Second quarter 2006 operating profit excluding
intangibles amortization of US$7.8 million, stock option expense
of US$2.1 million and a restructuring reversal of US$.3 million
was US$45.3 million, or 12.0% as a percentage of revenue for the
quarter, representing an increase of 30 basis points compared to
the same period of last year.
Recently, the Company completed three acquisitions in the
priority growth areas of screening, diagnostics and service.
Within screening and diagnostics, the Company acquired the
business and associated intellectual property of NTD
Laboratories and Spectral Genomics. NTD Laboratories is a
leading provider of first-trimester prenatal risk assessment,
while Spectral Genomics is a leader in molecular karyotyping
technology used to research chromosomal abnormalities. NTD
Laboratories and Spectral Genomics provide additional technology
and a broader platform to drive the Company's high growth
screening and diagnostics strategies.
Within service, the Company acquired Clinical & Analytical
Services Solutions, an asset management firm that the Company
expects will allow it to drive laboratory efficiency and cost
savings for customers through asset management and expert
maintenance.
"We were pleased to deliver excellent cash EPS growth during the
quarter, with strong performance in our key growth platforms of
genetic screening, imaging and service," said Gregory L. Summe,
chairman and CEO of the Company. "We remain focused on driving
growth in these platforms as evidenced by our strategic
acquisitions of NTD Laboratories, Spectral Genomics and C&A as
well as our increased investment in R&D. We are committed to
further increasing our investment in these attractive growth
areas," added Mr. Summe.
The Company generated operating cash flows of US$53.2 million in
the second quarter of 2006. Free cash flow for the second
quarter of 2006, defined as operating cash flow of US$53.2
million less capital expenditures of US$12.2 million, was US$41
million. This number includes a tax payment of US$4.6 million
related to the gain on the divestiture of Fluid Sciences. Free
cash flow, net of divestiture taxes, was US$45.6 million.
Financial Guidance
For the third quarter of 2006, the Company projects GAAP
earnings per share from continuing operations of between US$.22
and US$.24. Excluding the impact of intangibles amortization
and stock option expense, the Company projects earnings per
share from continuing operations of between US$.27 and US$.29
for the third quarter of 2006, an increase of approximately 13%
to 21% over the third quarter 2005. For the full year 2006, the
Company projects GAAP earnings per share from continuing
operations of between US$.95 and US$1.00, and earnings per share
excluding intangibles amortization and stock option expense, of
between US$1.15 and US$1.20 per share. This reflects
approximately US$.05 per share change in full year cash EPS
guidance due to dilution from acquisitions and increased growth
investments in the second half of 2006.
About PerkinElmer
PerkinElmer Inc. (NYSE: PKI) -- http://www.perkinelmer.com/
-- is a global technology leader driving growth and innovation
in Health Sciences and Photonics markets to improve the quality
of life. PerkinElmer reported revenues of US$1.5 billion in
2005, has 8,000 employees serving customers in more than 125
countries, and is a component of the S&P 500 Index. In Latin
America, PerkinElmer has offices in Argentina, Bolivia, Brazil,
Chile, Colombia, Costa Rica, Dominican Republic, Ecuador, El
Salvador, Guatemala, Honduras, Mexico, Nicaragua, Panama,
Paraguay, Peru, Puerto Rico, Uruguay and Venezuela.
* * *
PerkinElmer Inc.'s Long Term Subordinated Debt carry Moody's
Investors Service's Ba1 rating.
PERKINELMER INC: Board Declares US$0.07 Per Share Dividend
----------------------------------------------------------
The Board of Directors of PerkinElmer, Inc., has declared a
regular quarterly dividend of US$.07 per share of common stock.
This dividend is payable on Nov. 10, 2006, to all shareholders
of record at the close of business on Oct. 20, 2006.
PerkinElmer Inc. (NYSE: PKI) -- http://www.perkinelmer.com/--
is a global technology leader driving growth and innovation in
Health Sciences and Photonics markets to improve the quality of
life. PerkinElmer reported revenues of US$1.5 billion in 2005,
has 8,000 employees serving customers in more than 125
countries, and is a component of the S&P 500 Index. In Latin
America, PerkinElmer has offices in Argentina, Bolivia, Brazil,
Chile, Colombia, Costa Rica, Dominican Republic, Ecuador, El
Salvador, Guatemala, Honduras, Mexico, Nicaragua, Panama,
Paraguay, Peru, Puerto Rico, Uruguay and Venezuela.
* * *
PerkinElmer Inc.'s Long Term Subordinated Debt carry Moody's
Investors Service's Ba1 rating.
===========
G U Y A N A
===========
DIGICEL LTD: Rejects Accusations of Stealing Info from Celstar
--------------------------------------------------------------
Digicel Ltd. denied allegations on stealing CelStar's corporate
secrets, the Associated Press reports.
According to AP, CelStar Inc. and its US parent firm Trans World
Telecom filed a US$30-million lawsuit against Digicel in
Guyana's High Court late last week.
CelStar and Trans World accused Digicel of secretly hiring
CelStar senior employees to get certain information, AP says.
Celstar claimed Digicel was in breach of industry practices.
AP notes that Celstar admitted it was worried that Digicel would
have an unfair advantage if it launched operations in Guyana.
Meanwhile, Digicel told AP that it had not been served a civil
lawsuit and is confident that the allegations of CelStar and
Trans World "had no validity."
The report underscores that a hearing was scheduled on Aug. 8.
Digicel Limited is a wireless services provider in the Caribbean
region founded in 2000, and controlled by Denis O'Brien. The
company started operations in Jamaica in April 2001 and now
offers GSM mobile services in 13 countries of the Caribbean
including Jamaica, St. Lucia, St. Vincent, Aruba, Grenada,
Barbados, Cayman, and Curacao among others. Digicel finished
FY2005 with 1.722 million total subscribers -- 97% pre-paid --
estimated market share of 67% and revenues and EBITDA of US$478
million and US$155 million, respectively.
* * *
On July 12, 2006, Moody's Investors Service assigned a B3 senior
unsecured rating to the US$150 million add-on Notes offering of
Digicel Limited and affirmed Digicel's existing B3 senior
unsecured and B1 Corporate Family Ratings. The outlook has been
changed to stable from positive.
Fitch Ratings assigned on July 14, 2006, a 'B' rating to Digicel
Limited's proposed add-on offering of US$150 million 9.25%
senior notes due 2012. These notes are an extension of the
US$300 million notes issued in July 2005. In addition, Fitch
also affirms Digicel's foreign currency Issuer Default Rating
and the existing US$300 million senior notes due 2012 at 'B'.
Fitch said the Rating Outlook is Stable.
===============
H O N D U R A S
===============
* HONDURAS: President May Allow Mining Ban, Says Bishop
-------------------------------------------------------
"It seems that the president is more inclined toward our
proposal," Luis Santos Villeda -- a bishop in Honduras -- told
the Upside Down World, referring to the nationwide effort to ban
open-pit mining for minerals.
The Upside Down World reports that Bishop Santos -- who helped
lead a July 25 protest attended by priests, farmers, students
and environmentalists -- emerged from a meeting with Honduras'
President Manuel Zelaya on Aug. 1 confident that the ban on
environmentally and socially destructive mining practice will be
ratified.
According to the report, President Zelaya had said a week
earlier that the protestors were giving the nation a bad image.
As reported in the Troubled Company Reporter-Latin America on
July 31, 2006, the Honduran government had refused to negotiate
with groups protesting on the law that allowed foreigners to own
up to 34% of the mines in the country. Honduras' 1998 law on
foreign mine ownership had sparked a protest -- organized by the
Civic and Democratic Alliance -- that closed parts of the Pan-
American Highway, the major route in Honduras. However, the
protest made the government decide to meet with heads of the
Civic Alliance for Democracy to talk on the future of the mining
industry.
"The scene in Honduras for investment and mining companies is
totally clouded. If open pit mining is prohibited, mining will
disappear in this country," Reuters states, citing Gabino
Carbajal, the head of the national mining association.
* * *
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
=============
CENTURY ALUMINUM: Earns US$45.8 Mil. in Second Quarter of 2006
--------------------------------------------------------------
Century Aluminum Company reported net income of US$45.8 million
for the second quarter of 2006, versus the second quarter of
2005 reported net income of US$40.7 million.
Sales in the second quarter of 2006 were US$406 million,
compared with US$283.3 million in the second quarter of 2005.
Shipments of primary aluminum for the quarter totaled 378.6
million pounds compared with 339.5 million pounds in the year-
ago quarter, reflecting the impact of the Nordural expansion.
For the first half of 2006 the company reported a net loss of
US$95.8 million, which includes an after-tax charge of US$203
million for mark-to-market adjustments on forward contracts,
compared with net income of US$52.5 million in the year-ago
period.
Sales in the first six months of 2006 were US$752.9 million
compared with US$568.7 million in the same period of 2005.
Shipments of primary aluminum for the first six months of 2006
were 724.6 million pounds compared with 676.5 million pounds for
the comparable 2005 period.
The Company also disclosed that it has reached a labor agreement
with the United Steelworkers at the Hawesville, Kentucky smelter
and it has signed a memorandum of understanding with Icelandic
power producers Hitaveita Sudurnesja and Orkuveita Reykjavikur,
to purchase electrical energy for the greenfield smelter project
in Helguvik, Iceland.
The Company further disclosed reaching an agreement for a joint
venture with Minmetals Aluminum Company, to explore the
potential of developing a bauxite mine and associated 1.5
million mtpy alumina refining facility in Jamaica.
A full-text copy of Century Aluminum's quarterly report is
available for free at http://ResearchArchives.com/t/s?f1e
Headquartered in Monterey, California, Century Aluminum Company
(NASDAQ:CENX) -- http://www.centuryca.com/-- owns and operates
a 244,000 mtpy plant at Hawesville, Kentucky; a 170,000 mtpy
plant at Ravenswood, West Virginia; and a 90,000 mtpy plant at
Grundartangi, Iceland. The company also owns a 49.67% interest
in a 222,000 mtpy reduction plant at Mt. Holly, South Carolina.
ALCOA Inc. owns the remainder of the plant and is the operating
partner. Century also holds a 50% share of the 1.25 million
mtpy Gramercy Alumina refinery in Gramercy, Louisiana and
related bauxite assets in Jamaica.
* * *
Moody's assigned Century Aluminum Company's senior secured debt
and long-term corporate family ratings at B1. The ratings were
placed on April 22, 2003, with a positive outlook.
Standard & Poor's placed the Company's long-term local and
foreign issuer credit ratings at BB- with a stable outlook on
March 13, 2001.
KAISER ALUMINUM: Salaried VEBA Trust Discloses 44% Equity Stake
---------------------------------------------------------------
The Voluntary Employees' Beneficiary Association Trust for
Salaried Retirees of Kaiser Aluminum Corp. is deemed to be the
beneficial owner of 8,809,900 shares or 44% of KAC's common
stock, with US$.01 par value per share.
Gary Chontos, director of client service for National City Bank,
which serves as trustee of the Salaried VEBA Trust, discloses
the information in a Form SC 13G filing with the U.S. Securities
and Exchange Commission on July 24, 2006.
The Salaried VEBA Trust does not have the power to vote nor
dispose the shares it owns.
Headquartered in Foothill Ranch, California, Kaiser Aluminum
Corp. -- http://www.kaiseraluminum.com/-- is a leading
producer of fabricated aluminum products for aerospace and high-
strength, general engineering, automotive, and custom industrial
applications. The Company, along with its Jamaican subsidiaries
-- Alpart Jamaica Inc. and Kaiser Jamaica Corporation -- filed
for chapter 11 protection on Feb. 12, 2002 (Bankr. Del. Case No.
02-10429), and has sold off a number of its commodity businesses
during course of its cases. Corinne Ball, Esq., at Jones Day,
represents the Debtors in their restructuring efforts. Lazard
Freres & Co. serves as the Debtors' financial advisor. Lisa G.
Beckerman, Esq., H. Rey Stroube, III, Esq., and Henry J. Kaim,
Esq., at Akin, Gump, Strauss, Hauer & Feld, LLP, and William P.
Bowden, Esq., at Ashby & Geddes represent the Debtors' Official
Committee of Unsecured Creditors. The Debtors' Chapter 11 Plan
became effective on July 6, 2006. On June 30, 2004, the Debtors
listed US$1.619 billion in assets and US$3.396 billion in debts.
(Kaiser Bankruptcy News, Issue No. 101; Bankruptcy Creditors'
Service, Inc., 609/392-0900)
===========
M E X I C O
===========
AXTEL SA: Launches Operations in Irapuato, Guanajuato
-----------------------------------------------------
Axtel, S.A. de C.V., disclosed the official startup of its
operations in Irapuato, Guanajuato.
Samuel Lee Belmonte, Axtel Executive Director for the North-
Western Region, delivered a speech to the guests, after which
Luis Vargas Gutierrez, the Major of Irapuato, made the first
telephone call over an Axtel line.
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 Irapuato.
Axtel informed that their network is already covering 95% of the
population with telephone, internet, and advance data services
for users in the residential and business sectors.
Axtel disclosed that it will have made a direct investment of
US$15 million in Irapuato in the next five years.
Irapuato is the third city in the State of Guanajuato where
Axtel is offering its services. The first one was Leon, where
Axtel started to operate in January 2001, and the second was
Celaya, where its activities started on May 18, 2006.
"With this opening, we have successfully fulfilled the goal that
we set to ourselves this year as to opening new cities. We are
celebrating not only the start of operations in the seventeenth
city that we have reached, but also the possibility of offering
the Irapuato society the opportunity to choose a new telephone
service provider", said Samuel Lee.
Axtel, which will invest 150 million nationwide in 2006,
reported having installed 697,000 lines by the end of June 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.
About Axtel
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 MXP306 million (US$29 million) for 2005 compared
to a loss of MXP79.6 million in 2004.
* * *
As reported in the Troubled Company Reporter on June 21, 2006,
Standard & Poor's Ratings Services raised its long-term
corporate credit rating on Monterrey, Mexico-based
telecommunications service provider Axtel S.A. de C.V. to 'BB-'
from 'B+'. The outlook was revised to stable from positive.
The rating on Axtel's US$162 million senior notes due 2013 was
also raised to 'BB-' from 'B+'.
BALLY TOTAL: Names Ronald G. Eidell as Senior VP and CFO
--------------------------------------------------------
Bally Total Fitness Holding Corp.'s Board of Directors named
Ronald G. Eidell as senior vice president, chief financial
officer and principal financial officer.
Bally Total disclosed that it entered into an interim executive
services agreement with Tatum LLC, pursuant to which Mr. Eidell,
a partner of Tatum LLC, was engaged as the Company's Senior Vice
President, Finance.
Prior to joining Bally, Mr. Eidell, served as interim president
and chief executive officer of NeoPharm, Inc. from March 2005 to
Oct. 2005. Mr. Eidell has been a partner with Tatum LLC, a
national professional services firm, since Oct. 2004. Prior to
that he served as the chief financial officer of each of
Esoterix, Inc., a provider of medical testing services, from
2001 to 2003, NovaMed, Inc., a healthcare provider, from 1998-
2001, and Metromail Corp., a provider of information services,
from 1996-1998. He also serves as a director of NeoPharm, Inc.,
where he serves on the audit committee.
Separate Agreement With Former CFO
The Company also disclosed that Carl J. Landeck ceased serving
as chief financial officer of the Company effective on
April 13, 2006. In connection with Mr. Landeck's departure, the
Company entered into a Separation Agreement with Mr. Landeck on
Aug. 1, 2006. The separation agreement released the Company
from any and all claims or causes of action that Mr. Landeck
might have against the Company.
Modification of Chairman and CEO's Employment Agreement
The Company further disclosed that on Aug. 6, 2006, the board of
directors, with Mr. Toback recusing himself, approved a
modification to the Employment Agreement with Paul A. Toback,
the Company's Chairman and Chief Executive Officer, in exchange
for Mr. Toback's agreement to resolve his various claims,
including the Company's obligation to implement a supplemental
retirement plan for his benefit. Certain directors dissented
from the decision.
A full text-copy of the agreements with Mr. Toback and Mr.
Landeck may be viewed for free at
http://ResearchArchives.com/t/s?f2a
Bally Total Fitness Holding Corp.
-- http://www.Ballyfitness.com/-- is the largest and only
nationwide commercial operator of fitness centers, with over 400
facilities located in 29 states, Mexico, Canada, Korea, the
Caribbean, and China under the Bally Total Fitness, Bally Sports
Clubs and Sports Clubs of Canada brands. Bally offers a unique
platform for distribution of a wide range of products and
services targeted to active, fitness-conscious adult consumers.
* * *
As reported in the Troubled Company Reporter on March 17, 2006,
Standard & Poor's Ratings Services held its ratings on Bally
Total Fitness Holding Corp., including the 'CCC' corporate
credit rating, on CreditWatch with developing implications,
where they were placed on Dec. 2, 2005.
CELESTICA: Incurs US$30.3 Mil. Net Loss in Quarter Ended June 30
----------------------------------------------------------------
Celestica Inc. generated US$2.2 billion of revenue for the
second quarter ended June 30, 2006, down 1% from US$2.25 billion
in the second quarter of 2005.
Net loss on a GAAP basis for the second quarter was US$30.3
million, compared to GAAP net earnings of US$12.6 million for
the same period last year. Included in GAAP net loss for the
quarter are charges of US$20 million associated with previously
announced restructuring plans and a US$33 million non-cash loss
associated with the sale of the company's plastics business in
the quarter.
Adjusted net earnings for the quarter were US$29.1 million,
compared to US$39.8 million for the same period last year.
Adjusted net earnings is defined as net earnings before
amortization of intangible assets, gains or losses on the
repurchase of shares and debt, integration costs related to
acquisitions, option expense, option exchange costs and other
charges, net of tax and significant deferred tax write-offs.
These results compare with the company's guidance for the second
quarter, announced on April 27, 2006, of revenue of US$2.05
billion to US$2.25 billion.
For the six months ended June 30, 2006, revenue was US$4.158
billion compared to US$4.401 billion for the same period in
2005. Net loss on a GAAP basis was US$47.7 million, compared to
net earnings of US$1 million last year. Adjusted net earnings
for the first half of 2006 were US$46.5 million, compared to
adjusted net earnings of US$73.2 million for the same period in
2005.
"The sequential revenue growth reflects the growing benefits
from our focus on revenue diversification," said Steve Delaney,
CEO, Celestica. "With a backdrop of stable end markets,
improved efficiencies in our high growth facilities, ramping new
programs, and the completion of our restructuring activities, we
are confident in continued revenue growth and stronger margins
throughout 2006."
Outlook
For the third quarter ending Sept. 30, 2006, the company
anticipates revenue to be in the range of US$2.15 billion to
US$2.35 billion. The revenue outlook reflects a stable end
market environment as well as additional volume from ramping new
programs. The anticipated improvement in adjusted earnings is
being driven by continued benefits from the company's
restructuring activities and increased efficiencies in its
Mexico and European operations.
About Celestica
Headquartered in Toronto, Ontario, Celestica, Inc. (NYSE: CLS,
TSX: CLS/SV) -- http://www.celestica.com/-- is a world leader
in the delivery of innovative electronics manufacturing
services. Celestica operates a highly sophisticated global
manufacturing network with operations in Asia, Europe, Mexico,
Puerto Rico, Brazil, Canada and the United States. It provides
a broad range of integrated services and solutions to original
equipment manufacturers. Celestica's expertise in quality,
technology and supply chain management, enables the company to
provide competitive advantage to its customers by improving
time-to-market, scalability and manufacturing
efficiency.
* * *
Celestica carries Fitch's 'BB-' issuer default and unsecured
credit facility ratings. Fitch also assigned a 'B+' rating to
the Company's senior subordinated debt. The Rating Outlook is
Stable.
In February 2005, Moody's Investors Service lowered Celestica's
senior implied rating to Ba3 from Ba2, senior unsecured issuer
rating to B1 from Ba3 and the subordinated notes rating to B2
from Ba3.
CINEMARK USA: Revenues Up 16.6% for Quarter Ended June 30
---------------------------------------------------------
Cinemark USA, Inc.'s revenues for the three months ended
June 30, 2006, increased 16.6% to US$295.1 million from US$253.0
million for the three months ended June 30, 2005. The increase
was primarily related to a 11.3% increase in attendance, a 4.2%
increase in average ticket prices and a 2.8% increase in
concession revenues per patron. Operating income for the three
months ended June 30, 2006, was US$46.2 million compared with
operating income of US$31.9 million for the three months ended
June 30, 2005. Earnings before interest, taxes, depreciation,
amortization and other non-cash expenditures for the three
months ended June 30, 2006, increased to US$69.0 million from
US$52.4 million for the three months ended June 30, 2005. The
company's Adjusted EBITDA margin was 23.4% for the three months
ended June 30, 2006. Net income for the three months ended
June 30, 2006, was US$22.4 million compared to net income of
US$14.5 million for the three months ended June 30, 2005.
For the six months ended June 30, 2006, revenues increased 10.3%
to US$541.1 million from US$490.7 million for the six months
ended June 30, 2005. The increase was primarily related to a
3.8% increase in attendance, a 5.0% increase in average ticket
prices and a 6.3% increase in concession revenues per patron.
The company's operating income for the six months ended June 30,
2006 was US$73.5 million compared with operating income of
US$61.2 million for the six months ended June 30, 2005.
Adjusted EBITDA for the six months ended June 30, 2006,
increased to US$118.7 million from US$101.5 million for the six
months ended June 30, 2005. The company's Adjusted EBITDA
margin was 21.9% for the six months ended June 30, 2006. Net
income for the six months ended June 30, 2006, was US$36.3
million compared to net income of US$26.5 million for the six
months ended June 30, 2005.
Cinemark has entered into a definitive purchase agreement under
which it will acquire all of the outstanding stock of Century
Theatres, Inc. The equity purchase price is approximately
US$681 million in addition to the assumption of debt. To
finance the acquisition, the company plans to refinance its
current senior facility of US$254 million and Century's senior
facility of US$360 million with a new US$1,120 million senior
secured term loan and will issue to Century US$150 million of
common stock in Cinemark's parent. The company will utilize
approximately US$50 million of its current cash to fund the
payment of transaction expenses and the balance of the cash
purchase price. The Company also plans to increase its revolver
capacity to US$150 million with no amount drawn at closing.
Cinemark USA, Inc., continues to be a leader in the development
of stadium seating multiplex theatres. During the six months
ended June 30, 2006, the company opened 12 new theatres with a
total of 126 screens. On June 30, 2006, the company's aggregate
screen count was 3,401, with screens in the United States,
Canada, Mexico, Argentina, Brazil, Chile, Ecuador, Peru,
Honduras, El Salvador, Nicaragua, Costa Rica, Panama and
Colombia. As of June 30, 2006, the company had signed
commitments to open 9 new theatres with 106 screens by the end
of 2006 and open 11 new theatres with 130 screens subsequent to
2006.
Cinemark USA, Inc.
Financial and Operating Summary
(unaudited, in thousands)
Three months ended Six months ended
June 30, June 30,
------------------- ---------------------
2006 2005 2006 2005
--------- --------- ---------- ----------
Statement of Income data:
Theatre revenues $295,105 $253,027 $541,094 $490,708
Film rentals and
advertising 100,298 88,348 179,246 167,249
Concession supplies 14,807 12,650 26,847 24,395
Facility lease
expense 36,623 32,945 72,450 65,836
Other theatre
Operating expenses 60,296 55,125 116,943 108,587
General and
administrative
expenses 15,398 12,210 29,444 24,505
Depreciation,
amortization
and impairment
of long-lived
assets 20,658 19,667 41,103 38,147
Loss on sale of
assets and
other 815 150 1,543 838
--------- --------- ---------- ----------
Total costs and
expenses 248,895 221,095 467,576 429,557
--------- --------- ---------- ----------
Operating Income 46,210 31,932 73,518 61,151
Interest expense 12,529 11,632 25,058 22,899
Other income (370) (4) (863) (746)
--------- --------- ---------- ----------
Income before
income taxes 34,051 20,304 49,323 38,998
Income taxes 11,691 5,837 13,031 12,478
--------- --------- ---------- ----------
Net income $22,360 $14,467 $36,292 $26,520
========= ========= ========== ==========
Other Financial Data:
Adjusted EBITDA $69,013 $52,424 $118,743 $101,516
Adjusted EBITDA
margin 23.4% 20.7% 21.9% 20.7%
Other Operating Data:
Domestic Attendance
(patrons) 28,302 26,463 52,941 51,396
International
Attendance
(patrons) 16,615 13,911 30,484 29,004
--------- --------- ---------- ----------
Worldwide Attendance
(patrons) 44,917 40,374 83,425 80,400
========= ========= ========== ==========
As of As of
June 30, December
2006 31, 2005
---------- ----------
Balance Sheet Data:
Cash and cash equivalents $139,367 $182,180
Theatre properties and
equipment, net 796,610 790,566
Total assets 1,067,997 1,097,740
Long-term debt, including
current portion 605,929 620,277
Shareholder's equity 263,290 251,172
About Cinemark Inc.
Cinemark Inc., -- http://www.cinemark.com/-- a leader in the
theatre exhibition industry operates 202 theatres and 2,469
screens in 34 states in the United States and operates 112
theatres and 932 screens internationally in 13 countries, mainly
Mexico, South and Central America. Cinemark was founded in 1987
by its Chief Executive Officer and Chairman of the Board, Lee
Roy Mitchell. In 2004 a controlling interest in Cinemark was
sold to Madison Dearborn Capital Partners. Cinemark was among
the first theatre exhibitors to offer advanced real-time
Internet ticketing at its own website.
* * *
Standard & Poor's Ratings Services placed on Aug. 8, 2006, all
its ratings on Cinemark Inc. and subsidiary company Cinemark USA
Inc., which are analyzed on a consolidated basis, including the
'B+' corporate credit ratings, on CreditWatch with negative
implications.
The CreditWatch listing follows the company's announcement that
it will be financing the acquisition of Century Theatres Inc.
(B+/Negative/--) with a senior credit facility. Cinemark had
US$1 billion in debt and US$846 million in present value of
operating leases as of March 31, 2006.
MERIDIAN AUTOMOTIVE: Files Conformed Version of Revised 3rd Plan
----------------------------------------------------------------
Meridian Automotive Systems, Inc., and its debtor-affiliates
delivered to the U.S. Bankruptcy Court for the District of
Delaware a conformed version of their Revised Third Amended
Joint Plan of Reorganization on July 24, 2006. The Revised Plan
reflects immaterial changes.
A full-text copy of the Debtors' Conformed Third Amended Joint
Plan of Reorganization is available for free at
http://ResearchArchives.com/t/s?f24
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. 36; Bankruptcy Creditors'
Service, Inc., 215/945-7000).
MERIDIAN AUTOMOTIVE: Seeks Sept. 30 Plan-Filing Period Extension
----------------------------------------------------------------
Meridian Automotive Systems, Inc., and its debtor-affiliates
further ask the U.S. Bankruptcy Court for the District of
Delaware to extend their Exclusive Filing Period through and
including Sept. 30, 2006, and their Exclusive Solicitation
Period through and including Nov. 30, 2006.
The Debtors have worked strenuously to engage their principal
creditor constituencies in negotiations that have resulted in
the Conformed Third Amended Joint Plan of Reorganization, Robert
S. Brady, Esq., at Young Conaway Stargatt & Taylor, LLP, in
Wilmington, Delaware, tells the Court.
The filing of the Third Amended Plan and the Court's approval of
the Disclosure Statement on July 21, 2006, constitute
significant milestones in the Debtors' steady march towards Plan
confirmation, Mr. Brady says.
Mr. Brady relates that the Plan is now supported by all of the
Debtors' principal creditor constituencies, including the
Informal Committee of First Lien Secured Lenders and the
Official Committee of Unsecured Creditors. The Debtors are
currently in the process of mailing Plan solicitation packages
to all their creditors.
The brief extension of the Exclusive Periods is intended to
enable the Debtors to continue the Plan process in an orderly,
efficient and cost-effective manner, Mr. Brady explains. To
deny further extension of the Exclusive Periods at this stage
would jeopardize the significant progress the Debtors have made
toward Plan confirmation.
The Court will convene a hearing on Aug. 15, 2006, to consider
the Debtors' request. By application of Local Bankruptcy Rule
9006-2 for the District of Delaware, the Debtors' Exclusive
Filing Period is automatically extended until the conclusion of
that hearing.
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. 36; Bankruptcy Creditors'
Service, Inc., 215/945-7000).
===========
P A N A M A
===========
* PANAMA: Will Invest US$142 Million in Infrastructure Works
------------------------------------------------------------
Panam's President Martin Torrijos said in a report posted in the
presidential Web site that the government will invest over
US$142 million in the construction of the Panama-Colon highway
and other infrastructure works before the end of his term in
2009.
Business News Americas reports that the infrastructure program
was created to:
-- improve links between the Panama's tax free zone and the
ports in the cities of Panama and Colon, and
-- boost economic and commercial activity.
President Torrijos told BNamericas that the Andean Development
Corporation approved an US$80-million loan for Panama, to be
used in funding the construction of the Panama-Colon highway as
well as other infrastructure works on the Atlantic coast.
According to BNamericas, the president said that these projects
are also underway:
-- US$8.7 million sewerage system;
-- US$17.6 million, 183km extension of Panama's road and
highway network;
-- US$7 million for repairs to urban roads;
-- US$8 million reparation of the Chagres-Palmas Bellas-Rio
Indio highway; and
-- US$3.3 million Union Santena-Cuango-Santa Isabel road.
* * *
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
* PANAMA: Will Strengthen Bilateral Ties with European Union
------------------------------------------------------------
Panama will strengthen bilateral ties with the European Union,
Prensa Latina reports.
According to Prensa Latina, Josep Borrell -- the European
parliament president -- arrived in Panama on Wednesday and met
with Panama's President Martin Torrijos to deal with the Panama-
Central America integration process and the Association accord
between the region and the European Union.
Prensa Latina relates that Mr. Borrell will work with
ambassadors of the European Union nations in Panama, and meet
with the representatives of the country's political parties:
-- Democratic Revolutionary Party,
-- Panamenista,
-- Cambio Democratico, and
-- Union Patriotica.
Mr. Borrell, says Prensa Latina, will meet with Elias Castillo,
his Panamanian counterpart and also talk with Jorge Arosemena --
his executive director -- in the City of Knowledge, Prensa
Latina states.
* * *
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
=======
BIO-RAD LAB: Generates US$317.7 Million Second Quarter Revenues
---------------------------------------------------------------
Bio-Rad Laboratories, Inc., reported its financial results for
the second quarter ended June 30, 2006. Second-quarter revenues
from continuing operations were US$317.7 million, up 9.1%
compared to the US$291.3 million reported for the second quarter
of 2005.
Included in this figure is one-time additional revenue of
US$11.7 million resulting from a licensing settlement agreement
reached with bioMerieux, which had a favorable impact on both
the second quarter and year-to-date figures for 2006. On a
currency-neutral basis, revenues increased 9.7% compared to the
same period last year or 5.6% excluding the settlement. This
sales increase was the result of growth across product areas in
both the Life Science and Clinical Diagnostics segments.
Income from continuing operations for the quarter was
US$32.3 million compared to US$18.4 million during the second
quarter last year. At 58.1%, second-quarter gross margin from
continuing operations was markedly higher than the 55.1%
reported for the second quarter of 2005. Excluding the impact
of the bioMerieux settlement, gross margin was 56.5%.
Year-to-date revenues from continuing operations grew by 6% to
US$626.1 million compared to the same period last year.
Normalizing for the impact of currency effects, growth was 9%.
Income from continuing operations increased by 32.5% to US$63.5
million, or US$2.41 per share compared to US$47.9 million for
the first six months of 2005. Year-to-date gross margin was
57.5% compared to 55.4% in the same period last year.
Second-Quarter Highlights
Second-quarter basic earnings from continuing operations were
US$1.22 per share compared to US$0.71 and US$0.69, respectively,
during the same period of last year.
As a result of a settlement reached with bioMerieux, Bio-Rad
reported additional revenue in the second quarter of
US$11.7 million in royalties and licensing fees.
Life Science segment net sales for the quarter were US$134.4
million, up somewhat from US$133.1 million reported in the
second quarter of last year. Sales in this area increased by
1.0% or 1.8% excluding currency effects over the same period
last year.
The Clinical Diagnostics segment reported sales of US$180.2
million, a 16.1% increase over the same period last year of
US$155.2 million. On a currency-neutral basis, segment sales
increased 16.6%. Excluding the bioMerieux settlement, currency-
neutral sales increased by 8.9%.
In April, the Company announced that it had signed a multi-year
agreement in which Premier, one of the largest group purchasing
organizations in the United States, had agreed to a three-year
sole-source contract with Bio-Rad covering diabetes monitoring
instrumentation and products.
During the quarter, Cell Signaling Technology and Bio-Rad
entered into a partnership agreement in which CST will develop a
broad array of antibody assays that will run on the Bio-Plex(R)
suspension array system.
Life Science segment net sales for the quarter were
US$134.4 million, up 1% compared to US$133.1 million in the
second quarter last year. On a currency-neutral basis, sales
increased by 1.8%. Performance in this segment was the result
of a number of factors including sales of amplification
reagents, process chromatography media and the Bio-Plex(R)
suspension array system, which continue to show impressive
growth worldwide.
These results were somewhat tempered, however, by the continued
erosion of BSE testing revenue as well as increased competition
in real-time instrument sales worldwide. During the second
quarter, the Company launched iQ-Check(R) tests, a series of
rapid food diagnostic tests based on a quantitative PCR
platform. The new tests are both sensitive and specific
allowing for the detection of common food pathogens in less than
24 hours.
The Clinical Diagnostics segment reported sales of
US$180.2 million, a 16.1% increase over the second quarter last
year of US$155.2 million. On a currency-neutral basis, segment
sales increased 16.6%. These results are due in part to growth
across the product line in addition to the bioMerieux
settlement.
In April, the Company introduced the Platelia Dengue NS1 Ag
Assay for dengue screening. The test provides early diagnosis
of dengue acute infections, a tropical disease transmitted to
humans from mosquitoes. Also during April, the Company launched
a diagnostic test for celiac disease, an autoimmune disorder
characterized by individuals having abnormal reactions to
gluten, a protein found in wheat, barley, and rye.
"We are pleased to report overall solid financial performance
during the first half of the year," said Norman Schwartz,
Bio-Rad President and Chief Executive Officer. "As the year
progresses, we will continue to pursue targeted opportunities to
expand the business and improve operational efficiencies."
Bio-Rad Laboratories, Inc. (AMEX: BIO) (AMEX: BIOb) --
http://www.bio-rad.com/-- is a multinational manufacturer and
distributor of life science research products and clinical
diagnostics. Based in Hercules, California, Bio-Rad serves more
than 70,000 research and industry customers worldwide through a
network of more than 30 wholly owned subsidiary offices in
Argentina, Brazil and Peru, among others.
* * *
As reported on the Troubled Company Reporter on June 2, 2006,
Bio-Rad Laboratories, Inc.'s 7-1/2% Senior Subordinated Notes
due 2013 carry Moody's Investors Service's Ba3 rating and
Standard & Poor's BB- rating.
PETROLEO BRASILEIRO: To Expand Business Operations in Peru
----------------------------------------------------------
Petroleo Brasileiro S.A. aka Petrobras' president Jose Sergio
Gabrielli de Azevedo, met Peru's Energy and Mines Minister, Juan
Valdivia Romero, Vice-Minister Pedro Gamio Aita, and executives
from the Peruvian Petroperu and Perupetro national oil companies
to discuss expansion opportunities for Petrobras' businesses in
the country.
Petrobras has been in Peru since the mid-1990s. Currently,
through a Petrobras Energia S.A. subsidiary purchased in 2002,
the company also has production activities at Lot X in Talara,
northeastern Peru, near the border with Ecuador, in addition to
an exploratory profile in six lots that, together, add up to
57,500 square kilometers.
Petrobras Peru's current production is 15,000 barrels of oil and
gas a day. Aiming at expanding its exploration and production
activities, the Company has been positioning itself
strategically in the Camisea Field region, in southern Peru,
since last year. This field's total gas reserves surpass 15
trillium cubic feet.
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+'
=====================
P U E R T O R I C O
=====================
DRESSER: Seeks Lenders' Consent on Reporting Filing Extension
-------------------------------------------------------------
Dresser, Inc., is seeking various amendments to its senior
secured credit facility and consent under its senior unsecured
term loan, including the extension of deadlines for providing
financial statements which are consistent with those required by
the indenture governing its 9-3/8% senior subordinated notes.
The requested amendments and consent would extend the deadline
from Sept. 30, 2006, to Dec. 31, 2006, for providing audited
financial statements for the fiscal year ended Dec. 31, 2005.
In addition, the consent would extend the deadline from
Sept. 30, 2006, to March 31, 2007, for providing all 2006
quarterly financial statements.
The proposed amendments to the senior secured credit facility
would also extend the term of its revolving credit facility from
April 10, 2007, to April 10, 2008, permit a new US$50 million
synthetic letter of credit facility, and address certain
technical aspects of the lending agreements.
The company believes it is currently in compliance with all
requirements of its financing agreements. However it will not
meet the current Sept. 30 deadline for the filing of its
quarterly statements and unforeseen matters could cause it to be
delayed in meeting the current Sept. 30 deadline for the filing
of its 2005 audited financial statements.
The company noted its backlog and bookings remain strong. The
company's positive cash flow has allowed it to make a total of
US$50 million in voluntary prepayments on its senior secured
term loan thus far in 2006.
The company said the delay in delivering its financial
statements was necessary in order to address certain accounting
issues. The company does not believe the resolution of its
accounting matters will have a significant impact on EBTIDA from
continuing operations or its financial position, including its
cash position and total debt.
The company is restating its 2004 annual and quarterly financial
statements, as well as its 2005 quarterly financial statements,
and continues to evaluate other prior periods that may also
require restatement.
About Dresser
Based in Addison, Texas, Dresser, Inc. --
http://www.dresser.com/-- designs, manufactures and markets
equipment and services sold primarily to customers in the flow
control, measurement systems, and compression and power systems
segments of the energy industry. The Company has a
comprehensive global presence, with over 8,500 employees and a
sales presence in over 100 countries worldwide including Mexico
and Puerto Rico.
* * *
As reported in the Troubled Company Reporter on Aug. 3, 2006,
Moody's Investors Service downgraded Dresser, Inc.'s ratings.
Moody's said the rating outlook is negative.
Dresser's Corporate Family Rating was downgraded to B1 from Ba3.
The rating for the Company's Senior Secured Tranche C Term Loan
maturing 2009 was downgraded to B1 from Ba3. Moody's also
downgraded the rating for the Company's Senior Unsecured Term
Loan maturing 2010 to B2 from B1. The Company's Senior
Subordinated Notes maturing 2011 was downgraded to B3 from B2.
KMART CORP: Court Okays Pact Allowing McKellar to Pursue Claim
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois
signed an agreed order between Lillie McKellar and Kmart Corp.
partially lifting the automatic stay and injunction provision
under Kmart's Plan of Reorganization to permit Ms. McKellar's
litigation to proceed and continue to a final judgment or
settlement.
In January 2002, Ms. McKellar filed two civil action complaints
in the Court of Common Pleas, Philadelphia County, Pennsylvania,
for injuries sustained as a result of a dangerous and defective
condition in the parking lot of Cedarbrook Mall at, or near, the
location of Kmart Corp.
The Complaints were raised against:
(1) Nassimi Investments, LLC, Cedarbrook Mall Management
Company, Cedarbrook Mall, Cedarbrook Realty Corporation
and Kmart Corporation; and
(2) Stephen Scott, individually and t/a Scott Contractors.
On Dec. 9, 2002, the Court consolidated the complaints under
the action of Lillie McKellar vs. Steven Scott, individually and
t/a Scott Contractors. The action was placed in deferred status
because Kmart was in bankruptcy.
The Reorganized Debtors objected to McKellar's claim.
Ms. McKellar asked the Court to lift the stay and plan
injunction to pursue her claim, asserting that in May 2004, her
counsel received a letter from Kmart indicating that if she
"files a Motion to Lift the Stay on the local litigation, Kmart
will not object."
Headquartered in Troy, Michigan, Kmart Corp. nka KMART
Holding Corp. -- 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. 114; Bankruptcy Creditors' Service, Inc., 215/945-
7000)
KMART CORP: S. Henderson Can Proceed with Personal Injury Suit
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois
signed an agreed order between Kmart Corp. and Susan Henderson
partially lifting the automatic stay and injunction provision
under Kmart's Plan of Reorganization to permit the litigation
captioned Susan Henderson, et al., v. Kmart Corporation, et al.,
to proceed to final judgment or settlement.
The litigation seeks to establish and liquidate Ms. Henderson's
personal injury claim.
Ms. Henderson got hurt as a result of Kmart's alleged
negligence. On Dec. 4, 2001, Ms. Henderson filed a personal
injury claim against Kmart in the Philadelphia Court of Common
Pleas.
In January 2002, the automatic stay prevented Ms. Henderson from
pursuing her Claim against Kmart.
Ms. Henderson asked the Court to lift the stay to allow her to
pursue her Claim, asserting that she has complied with, and
exhausted in good faith, the Claims Resolution Procedure.
Headquartered in Troy, Michigan, Kmart Corp. nka KMART
Holding Corp. -- 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. 114; Bankruptcy Creditors' Service, Inc., 215/945-
7000)
MUSICLAND HOLDING: Inks Stipulation with Verizon on Service Pact
----------------------------------------------------------------
Musicland Holding Corp., its debtor-affiliates and Verizon
Business, Inc., formerly known as MCI, Inc., are parties to a
Service Agreement dated Aug. 16, 2005, as reported in the
Troubled Company Reporter on March 28, 2006,.
Verizon asked the Court to fix a deadline for the Debtors to
assume or reject the Service Agreement.
The Debtors no longer wish to buy telecommunication services
from Verizon and have sought the Court's authority to reject the
Service Agreement.
To resolve their disputes and agree on a wind-down of their
relationship under the Service Agreement, the Debtors and
Verizon stipulate that:
(a) As of June 30, 2006, unpaid postpetition charges under
the Service Agreement total US$267,406. After the
Petition Date and prior to assumption or rejection of
the Service Agreement, the Debtors will have an
additional credit of US$198 per day. After application
of the Postpetition Credit, the Debtors will bring
current all postpetition invoices under the Service
Agreement relating to the Agreed Invoices;
(b) Except with respect to the US$250,000 sign-up credit,
the Debtors agree that the amounts due pursuant to the
Service Agreement are entitled to administrative
priority;
(c) The Sign-up Credit will be applied over the Initial Term
of the Service Agreement, which commenced on
Oct. 15, 2005, for a period of 42 months. From
Oct. 15, 2005, through the Petition Date, the Debtors
will have a credit against the allowed amount of
Verizon's US$17,658 prepetition claim;
(d) The Debtors will apply the Postpetition Credit to set
off invoices for prepetition amounts due under the
Service Agreement;
(e) The Debtors will file a rejection notice;
(f) If Verizon will file a rejection damage claim with
respect to the Service Agreement by Aug. 16, 2006;
(g) Verizon does not consent to assumption and assignment of
the Service Agreement, and reserves its rights with
respect to it;
(h) The parties will reconcile the amounts due under the
Unresolved Invoices on or before Aug. 31, 2006; and
(i) The Parties deny any liability, wrongdoing, or
responsibility.
Accordingly, the Debtors ask the Court to approve their
Stipulation with Verizon.
Verizon withdraws its request to file the Service Agreement
under seal.
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. 15; Bankruptcy Creditors' Service, Inc., 215/945-7000)
MUSICLAND HOLDING: Paul Weiss Hired as Trade Vendors Panel Atty.
----------------------------------------------------------------
Pursuant to Rule 2019 of the Federal Rules of Bankruptcy
Procedure, Andrew Rosenberg, Esq., at Paul, Weiss, Rifkind,
Wharton & Garrison LLP, in New York, discloses that his firm
serves as counsel to these members of the Informal Committee of
Secured Trade Vendors:
(a) Bond Street Capital, LLC
700 Palisade Avenue
Englewood Cliffs, NJ 07632
(b) Cargill Financial Services International, Inc.,
12700 Whitewater Drive
Minnetonka, MN 55343-9439
(c) Credit Suisse International
11 Madison Avenue
New York, NY 10010
(d) Hain Capital Group, LLC
Meadowland Office Complex
301 Route 17
Rutherford, NJ 07070
(e) Varde Investment Partners, LP
8500 Normandale Lake Boulevard, Suite 1570
Minneapolis, MN 55437
(f) Metro-Goldwyn-Mayer Home Entertainment LLC
10250 Constellation Boulevard, 10th Floor
Los Angeles, CA 90067
(g) The Walt Disney Company
611 North Brand Boulevard, Suite 700
Glendale, CA 91203
Mr. Rosenberg relates that the nature of the claims held by
members of the Informal Committee against Musicland Holding
Corp. and its debtor-affiliates includes claims secured by
certain Trade Collateral.
Mr. Rosenberg discloses that his firm also represents Magazine
Retail Enterprises, Inc., and its affiliates Time Direct
Ventures, Inc., and Entertainment Weekly, Inc.
Paul Weiss does not hold any other claims against or equity
interests in the Debtors, Mr. Rosenberg assures the U.S.
Bankruptcy Court for the Southern District of New York.
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. 15; Bankruptcy Creditors' Service, Inc., 215/945-7000)
=================================
T R I N I D A D & T O B A G O
=================================
MIRANT: MC Asset Recovery Wants San Francisco's Claim Junked
------------------------------------------------------------
On Dec. 8, 1976, the San Francisco Port Commission, acting on
behalf of the city and county of San Francisco, and Pacific Gas
& Electric Company entered into an agreement relating to PG&E's
use of the San Francisco Port.
The Agreement provides that PG&E had a non-exclusive right to
use certain piers on the Port to receive petroleum products via
barge or ship and transport those products to the PG&E Potrero
power plant. In exchange, PG&E agreed to:
* pay San Francisco standard tariff charges for all
petroleum products offloaded; and
* make improvements to the Port, which were to be reimbursed
by San Francisco in the form of credit on PG&E's monthly
invoices.
The Agreement provides that on termination of the Agreement, the
San Francisco city and county have the option to require PG&E
remove its property, including the pipeline, from the Port.
The Agreement's termination date was Feb. 1, 1984, with an
option to extend. PG&E extended the term of the Agreement to
Feb. 1, 1994, but did not exercise its second option to
extend the term to Feb. 1, 2004.
In 1999, PG&E agreed to sell the Plant to Southern Energy
Potrero, L.L.C., now known as Mirant Energy Potrero, L.L.C., a
Mirant Corp. debtor-affiliate.
PG&E assigned the Agreement to Mirant Potrero, but remained
jointly and severally liable to San Francisco city and county
for the performance of all obligations under the Agreement. San
Francisco consented to the assignment in writing.
Mirant Potrero has not used the Port to receive oil since
June 2001, and to ship oil since September 2002.
In late 2002, Mirant Potrero engaged an environmental cleanup
company to remove all remaining petroleum from the pipeline. On
March 11, 2003, the State Lands Commission certified that the
pipeline was on "caretaker status." Currently, Mirant Potrero
is not using the pipeline and has no intention of doing so in
the future.
The Agreement was not listed on Schedule 12 of the Debtors'
Plan. Hence, the Agreement was deemed rejected as of the Plan's
Effective Date. Consequently, San Francisco filed a proof of
claim seeking US$4,000,000 for breach of contract, trespass,
creation of a nuisance, damages and attorney's fees and expenses
resulting from the rejection of the Agreement and estimated cost
of removing Mirant Potrero's property from the Port. The Claim
also reserves the right to assert indemnification or
environmental claims in accordance with the Agreement.
Michelle C. Campbell, Esq., at White & Case LLP, in Miami,
Florida, argues that no trespass existed and San Francisco
cannot have any damages. At no time prior to June 30, 2006, has
San Francisco formally asked that Mirant Potrero remove any
property from the Port.
San Francisco's claim for damages is excessive, Ms. Campbell
adds. The improvements could be removed at substantially less
than US$4,000,000. In addition, San Francisco offered no
evidence demonstrating the factual basis for its US$4,000,000
claim.
Moreover, MC Asset Recovery, LLC, the Debtors' disbursing agent
or litigation trust pursuant to their Plan of Reorganization,
objects to any indemnity claims, environmental claims, and other
obligations against Mirant Potrero under the Agreement on the
grounds that no liability is owed to San Francisco.
MC Asset Recovery is tasked, after emergence, to commence
litigation or object to claims so, in one way or the other,
Mirant will be able to recover or preserve its assets.
Therefore, MCAR asks the Court to disallow or reduce San
Francisco's Claim.
Headquartered in Atlanta, Georgia, Mirant Corp. (NYSE: MIR) --
http://www.mirant.com/-- is an energy company that produces and
sells electricity in North America, the Caribbean, and the
Philippines. Mirant's investments in the Caribbean include
three integrated utilities and assets in Jamaica, Grand Bahama,
Trinidad and Tobago and Curacao. Mirant owns or leases more
than 18,000 megawatts of electric generating capacity globally.
Mirant Corporation filed for chapter 11 protection on July 14,
2003 (Bankr. N.D. Tex. 03-46590), and emerged under the terms of
a confirmed Second Amended Plan on Jan. 3, 2006. Thomas E.
Lauria, Esq., at White & Case LLP, represented the Debtors in
their successful restructuring. When the Debtors filed for
protection from their creditors, they listed US$20,574,000,000
in assets and US$11,401,000,000 in debts. The Debtors emerged
from bankruptcy on Jan. 3, 2006. (Mirant Bankruptcy News, Issue
No. 102; Bankruptcy Creditors' Service, Inc., 215/945-7000)
* * *
As reported in the Troubled Company Reporter on July 17, 2006,
Moody's Investors Service downgraded the ratings of Mirant
Corporation and its subsidiaries Mirant North America, LLC and
Mirant Americas Generation, LLC. The Ba2 rating for Mirant Mid-
Atlantic, LLC's secured pass through trust certificates was
affirmed. Additionally, Mirant's Speculative Grade Liquidity
rating was revised to SGL-2 from SGL-1. The rating outlook is
stable for Mirant, MNA, MAG, and MIRMA.
Moody's downgraded Mirant Americas Generation, LLC's Senior
Unsecured Regular Bond/Debenture, to B3 from B2. Moody's also
downgraded Mirant Corporation's Corporate Family Rating, to B2
from B1, and Speculative Grade Liquidity Rating, to SGL-2 from
SGL-1. Mirant North America, LLC's Senior Secured Bank Credit
Facility, was also downgraded to B1 from Ba3 and its Senior
Unsecured Regular Bond/Debenture, to B2 from B1.
As reported in the Troubled Company Reporter on July 13, 2006,
Fitch Ratings placed the ratings of Mirant Corp., including the
Issuer Default Rating of 'B+', and its subsidiaries on Rating
Watch Negative following its announced plans to buy back stock
and sell its Philippine and Caribbean assets.
Ratings affected are Mirant Corp.'s 'B+' Issuer Default Rating
and Mirant Mid-Atlantic LLC's 'B+' Issuer Default Rating and the
Pass-through certificates' 'BB+/Recovery Rating RR1'.
Fitch also placed Mirant North America, Inc.'s Issuer Default
Rating of 'B+', Senior secured bank debt's 'BB/RR1' rating,
Senior secured term loan's 'BB/RR1' rating, and Senior unsecured
notes' 'BB-/RR1' rating on Rating Watch Negative. Mirant
Americas Generation, LLC's Issuer Default Rating of 'B+' and
Senior unsecured notes' 'B/RR5' rating was included as well.
Standard & Poor's Ratings Services also placed the 'B+'
corporate credit ratings on Mirant Corp. and its subsidiaries,
Mirant North American LLC, Mirant Americas Generating LLC, and
Mirant Mid-Atlantic LLC, on CreditWatch with negative
implications.
MIRANT CORP: To Auction Various US Gas-Fired Assets
---------------------------------------------------
Mirant Corp. discloses an auction process to sell various U.S.
intermediate and peaking gas fired assets. The U.S. assets to
be sold are the following intermediate and peaking gas fired
plants:
-- Zeeland (837 MW),
-- West Georgia (605 MW),
-- Shady Hills (468 MW),
-- Sugar Creek (535 MW),
-- Bosque (532 MW) and
-- Apex (527 MW),
representing a total of 3,504 MW. In 2005, on a pro-forma
basis, these assets contributed US$77 million in adjusted
EBITDA. For the first six months of 2006, on a pro-forma basis,
these assets contributed US$25 million in adjusted EBITDA.
Initial estimates indicate that an impairment loss will need to
be recorded in the third quarter of 2006 to reduce the carrying
value of these assets to fair value. While the amount of the
impairment loss has not yet been determined, the company
currently estimates the total impairment loss for the six plants
will range from US$500 to US$700 million. JPMorgan will serve
as financial advisor for the sale of these U.S. assets.
The decision is in addition to the one announced on
July 11, 2006, to commence auction processes to sell Mirant's
international businesses in the Philippines (2,203 MW) and the
Caribbean (1,050 MW). In 2005, on a pro-forma basis, the
Philippines and Caribbean businesses contributed US$371 million
and US$155 million in adjusted EBITDA, respectively.
For the first six months of 2006, on a pro-forma basis, the
Philippines and Caribbean businesses contributed US$206 million
and US$92 million in adjusted EBITDA, respectively.
Certain of the sales will be subject to regulatory and other
approvals and consents. The planned sales will result in these
businesses and assets being reported as discontinued operations
beginning in the third quarter of 2006. The sales are expected
to close by mid-2007.
Asset Sale Proceeds and Continuing Business
The continuing business of Mirant will consist of 10,657 MW that
are well positioned in key U.S. markets in the Mid-Atlantic, the
Northeast and California.
Mirant plans to continue returning cash to its shareholders upon
completion of the planned sales. The amount of cash returned
will be determined based on the outlook for the continuing
business
(1) to preserve the credit profile of the continuing
business,
(2) to maintain adequate liquidity for expected cash
requirements including, among other things, capital
expenditures for the continuing business, and
(3) to retain sufficient working capital to manage
fluctuations in commodity prices. Proceeds from the
sales of the Zeeland and Bosque plants will be utilized
pursuant to the covenants contained in the Mirant North
America debt instruments.
Headquartered in Atlanta, Georgia, Mirant Corp. (NYSE: MIR)
-- http://www.mirant.com/-- is an energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines. Mirant's investments in the Caribbean
include three integrated utilities and assets in Jamaica, Grand
Bahama, Trinidad and Tobago and Curacao. Mirant owns or leases
more than 18,000 megawatts of electric generating capacity
globally. Mirant Corporation filed for chapter 11 protection on
July 14, 2003 (Bankr. N.D. Tex. 03-46590), and emerged under the
terms of a confirmed Second Amended Plan on Jan. 3, 2006.
Thomas E. Lauria, Esq., at White & Case LLP, represented the
Debtors in their successful restructuring. When the Debtors
filed for protection from their creditors, they listed
US$20,574,000,000 in assets and US$11,401,000,000 in debts.
(Mirant Bankruptcy News, Issue No. 102; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
* * *
As reported in the Troubled Company Reporter on July 17, 2006,
Moody's Investors Service downgraded the ratings of Mirant
Corporation and its subsidiaries Mirant North America, LLC and
Mirant Americas Generation, LLC. The Ba2 rating for Mirant Mid-
Atlantic, LLC's secured pass through trust certificates was
affirmed. Additionally, Mirant's Speculative Grade Liquidity
rating was revised to SGL-2 from SGL-1. The rating outlook is
stable for Mirant, MNA, MAG, and MIRMA.
Moody's downgraded Mirant Americas Generation, LLC's Senior
Unsecured Regular Bond/Debenture, to B3 from B2. Moody's also
downgraded Mirant Corporation's Corporate Family Rating, to B2
from B1, and Speculative Grade Liquidity Rating, to SGL-2 from
SGL-1. Mirant North America, LLC's Senior Secured Bank Credit
Facility, was also downgraded to B1 from Ba3 and its Senior
Unsecured Regular Bond/Debenture, to B2 from B1.
As reported in the Troubled Company Reporter on July 13, 2006,
Fitch Ratings placed the ratings of Mirant Corp., including the
Issuer Default Rating of 'B+', and its subsidiaries on Rating
Watch Negative following its announced plans to buy back stock
and sell its Philippine and Caribbean assets.
Ratings affected are Mirant Corp.'s 'B+' Issuer Default Rating
and Mirant Mid-Atlantic LLC's 'B+' Issuer Default Rating and the
Pass-through certificates' 'BB+/Recovery Rating RR1'.
Fitch also placed Mirant North America, Inc.'s Issuer Default
Rating of 'B+', Senior secured bank debt's 'BB/RR1' rating,
Senior secured term loan's 'BB/RR1' rating, and Senior unsecured
notes' 'BB-/RR1' rating on Rating Watch Negative. Mirant
Americas Generation, LLC's Issuer Default Rating of 'B+' and
Senior unsecured notes' 'B/RR5' rating was included as well.
Standard & Poor's Ratings Services also placed the 'B+'
corporate credit ratings on Mirant Corp. and its subsidiaries,
Mirant North American LLC, Mirant Americas Generating LLC, and
Mirant Mid-Atlantic LLC, on CreditWatch with negative
implications.
MIRANT CORP: Net Income Reaches US$99MM in Second Quarter 2006
--------------------------------------------------------------
Mirant Corp. reported net income of US$99 million for the
quarter ended June 30, 2006, as compared to a net loss of US$10
million for the same period in 2005. For the first six months
of 2006, Mirant reported net income of US$566 million, compared
to US$1 million for the first six months of 2005. Earnings per
share for the quarter ended June 30, 2006, were US$0.32 per
diluted share and for the first six months of 2006 were US$1.84
per diluted share.
Excluding unrealized mark-to-market gains of US$108 million, a
US$72 million write off of a deferred tax asset related to the
Philippines business, and other non-recurring charges, Mirant
reported adjusted net income for the second quarter of 2006 of
US$68 million, resulting in adjusted earnings per diluted share
of US$0.22. Adjusted net income for the first six months of 2006
was US$210 million, resulting in adjusted earnings per diluted
share of US$0.68.
Adjusted EBITDA for the quarter was US$255 million, compared to
US$119 million for the same period in 2005. For the first six
months of 2006, adjusted EBITDA was US$595 million, compared to
US$288 million for the same period in 2005. The period over
period increases for the quarter and the first half of the year
resulted primarily from the strong performance of the U.S.
business.
"Our U.S. business performed well during the quarter and the
first half of 2006. This performance is due primarily to hedges
entered into in earlier periods, which protected Mirant from
lower market prices during the first half of the year resulting
from milder than normal weather in many parts of the country and
a significant drop in natural gas prices," said Edward R.
Muller, chairman and chief executive officer. "The company's
hedging strategy continues to be effective in helping to produce
predictable financial results."
Net cash provided by operating activities during the second
quarter was US$132 million. Adjusting for bankruptcy payments
during the period, net cash provided by operating activities was
US$643 million in the first six months of 2006.
As of June 30, 2006, the company had cash and cash equivalents
of US$1.8 billion, total available liquidity of US$2.13 billion,
and total outstanding debt of US$4.5 billion.
Asset Sales
Mirant discloses an auction process to sell various U.S.
intermediate and peaking gas fired assets. The U.S. assets to
be sold are the following intermediate and peaking gas fired
plants:
-- Zeeland (837 MW),
-- West Georgia (605 MW),
-- Shady Hills (468 MW),
-- Sugar Creek (535 MW),
-- Bosque (532 MW) and
-- Apex (527 MW),
representing a total of 3,504 MW. In 2005, on a pro-forma
basis, these assets contributed US$77 million in adjusted
EBITDA. For the first six months of 2006, on a pro-forma basis,
these assets contributed US$25 million in adjusted EBITDA.
Initial estimates indicate that an impairment loss will need to
be recorded in the third quarter of 2006 to reduce the carrying
value of these assets to fair value. While the amount of the
impairment loss has not yet been determined, the company
currently estimates the total impairment loss for the six plants
will range from US$500 to US$700 million. JPMorgan will serve
as financial advisor for the sale of these U.S. assets.
The decision is in addition to the one announced on
July 11, 2006, to commence auction processes to sell Mirant's
international businesses in the Philippines (2,203 MW) and the
Caribbean (1,050 MW). In 2005, on a pro-forma basis, the
Philippines and Caribbean businesses contributed US$371 million
and US$155 million in adjusted EBITDA, respectively.
For the first six months of 2006, on a pro-forma basis, the
Philippines and Caribbean businesses contributed US$206 million
and US$92 million in adjusted EBITDA, respectively.
Certain of the sales will be subject to regulatory and other
approvals and consents. The planned sales will result in these
businesses and assets being reported as discontinued operations
beginning in the third quarter of 2006. The sales are expected
to close by mid-2007.
Asset Sale Proceeds and Continuing Business
The continuing business of Mirant will consist of 10,657 MW that
are well positioned in key U.S. markets in the Mid-Atlantic, the
Northeast and California.
Mirant plans to continue returning cash to its shareholders upon
completion of the planned sales. The amount of cash returned
will be determined based on the outlook for the continuing
business
(1) to preserve the credit profile of the continuing
business,
(2) to maintain adequate liquidity for expected cash
requirements including, among other things, capital
expenditures for the continuing business, and
(3) to retain sufficient working capital to manage
fluctuations in commodity prices. Proceeds from the
sales of the Zeeland and Bosque plants will be utilized
pursuant to the covenants contained in the Mirant North
America debt instruments.
Guidance
Mirant provided adjusted EBITDA guidance for 2006 of US$1.282
billion, which is comprised of US$645 million for the continuing
business and US$637 million for the assets and businesses to be
sold. For 2007, Mirant provided adjusted EBITDA guidance of
US$1.585 billion, which is comprised of US$924 million for the
continuing business and US$661 million for the assets and
businesses to be sold. The guidance provided for 2007 includes
the adjusted EBITDA for the full year of the businesses and
assets to be sold, even though the sales are expected to close
by mid-2007. The actual financial results for 2007 will depend
on the closing dates of the sales of those businesses and
assets.
Headquartered in Atlanta, Georgia, Mirant Corp. (NYSE: MIR)
-- http://www.mirant.com/-- is an energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines. Mirant's investments in the Caribbean
include three integrated utilities and assets in Jamaica, Grand
Bahama, Trinidad and Tobago and Curacao. Mirant owns or leases
more than 18,000 megawatts of electric generating capacity
globally. Mirant Corporation filed for chapter 11 protection on
July 14, 2003 (Bankr. N.D. Tex. 03-46590), and emerged under the
terms of a confirmed Second Amended Plan on Jan. 3, 2006.
Thomas E. Lauria, Esq., at White & Case LLP, represented the
Debtors in their successful restructuring. When the Debtors
filed for protection from their creditors, they listed
US$20,574,000,000 in assets and US$11,401,000,000 in debts.
(Mirant Bankruptcy News, Issue No. 102; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
* * *
As reported in the Troubled Company Reporter on July 17, 2006,
Moody's Investors Service downgraded the ratings of Mirant
Corporation and its subsidiaries Mirant North America, LLC and
Mirant Americas Generation, LLC. The Ba2 rating for Mirant Mid-
Atlantic, LLC's secured pass through trust certificates was
affirmed. Additionally, Mirant's Speculative Grade Liquidity
rating was revised to SGL-2 from SGL-1. The rating outlook is
stable for Mirant, MNA, MAG, and MIRMA.
Moody's downgraded Mirant Americas Generation, LLC's Senior
Unsecured Regular Bond/Debenture, to B3 from B2. Moody's also
downgraded Mirant Corporation's Corporate Family Rating, to B2
from B1, and Speculative Grade Liquidity Rating, to SGL-2 from
SGL-1. Mirant North America, LLC's Senior Secured Bank Credit
Facility, was also downgraded to B1 from Ba3 and its Senior
Unsecured Regular Bond/Debenture, to B2 from B1.
As reported in the Troubled Company Reporter on July 13, 2006,
Fitch Ratings placed the ratings of Mirant Corp., including the
Issuer Default Rating of 'B+', and its subsidiaries on Rating
Watch Negative following its announced plans to buy back stock
and sell its Philippine and Caribbean assets.
Ratings affected are Mirant Corp.'s 'B+' Issuer Default Rating
and Mirant Mid-Atlantic LLC's 'B+' Issuer Default Rating and the
Pass-through certificates' 'BB+/Recovery Rating RR1'.
Fitch also placed Mirant North America, Inc.'s Issuer Default
Rating of 'B+', Senior secured bank debt's 'BB/RR1' rating,
Senior secured term loan's 'BB/RR1' rating, and Senior unsecured
notes' 'BB-/RR1' rating on Rating Watch Negative. Mirant
Americas Generation, LLC's Issuer Default Rating of 'B+' and
Senior unsecured notes' 'B/RR5' rating was included as well.
Standard & Poor's Ratings Services also placed the 'B+'
corporate credit ratings on Mirant Corp. and its subsidiaries,
Mirant North American LLC, Mirant Americas Generating LLC, and
Mirant Mid-Atlantic LLC, on CreditWatch with negative
implications.
=============
U R U G U A Y
=============
BANCO ITAU: To Acquire BankBoston Operations in Chile & Uruguay
---------------------------------------------------------------
Banco Itau Holding Financeira S.A. and Investimentos Itau S.A.
aka Itausa signed on August 8, 2006, agreements with Bank of
America Corp. to acquire BankBoston's operations in Chile and
Uruguay.
Contrary to what was announced on May 2, 2006, this operation's
settlement will be made against a cash payment and the delivery
of common shares.
Business Objective
BankBoston, Chile
With an already matured economy and institutions recognized
internationally for their soundness, Chile is classified as
investment grade with a Baa1 rating by Moody's. As at June 30,
2006, BKB Chile was ranked 12th in the Chilean financial system
based on total assets.
BankBoston Uruguay and OCA
The Uruguayan economy has been reporting a recovery and
accelerated growth in the past few years. Uruguay's GDP rose
12% in 2004 and 6.6% in 2005, with growth estimated at 5% for
this year. As of June 30 2006, in terms of total assets, BKB
Uruguay was ranked 3rd among Uruguayan private sector banks.
The OCA credit and debit card administrator is currently the
largest issuer of these cards in Uruguay, enjoying an
approximately 50% market share.
Price and Structure of the Business
The transaction for the acquisition of the Chilean and Uruguayan
operations provides for a cash payment of BRL2.3 million and the
issue of Itau common shares, equivalent to a stake of
approximately 1.7% in Itau's total capital stock (20,537,000
common shares of Itau's capital). Based on the average market
price for the period from February 21 to April 24, 2006, these
shares would have been worth BRL1,373 million.
Management's intention is to amortize the goodwill relative to
this transaction during fiscal year 2006. It is estimated that
there will be a reduction of BRL401 million in Itau's results,
net of the fiscal impacts, due to the amortization of goodwill.
Considering the new stockholder base, dividend/interest on own
capital (JCP) payouts to Itau's stockholders will not be
affected by this amortization and should be in excess of the
payouts for the 2005 fiscal year.
Based on pro-forma consolidated data for June 30, 2006, the
Basel Solvency Ratio will only be slightly affected, reaching
16.1% in spite of the full amortization of goodwill. The
positive effect of this operation is expected to begin impacting
Itau's Earnings per Share from the second half of 2007.
Impacts of the Transaction on Itausa
Factoring in the increase of capital stock with the
incorporation of shares, the change in stockholding composition,
and the amortization of goodwill, the net positive effect on
Itausa's results is estimated at BRL279 million.
Principal Indicators and Effects of
Bankboston Brazil + Chile + Uruguay
The principal indicators of these operations are shown in the
table:
Information Itau BKB BKB BKB OCA Pro
As Of June 30 Brazil Chile Uruguay Uruguay Forma
Total
BRL Million
Assets 172,413 22,184 6,557 1,937 229 203,320
Loans
(including
sureties
and
endorsements) 74,783 11,175 4,989 630 156 91,733
Deposits 52,921 6,061 2,766 1,569 - 63,317
Management
of Third
Parties'
Assets 138,923 27,965 595 1,314 - 168,797
Shareholders'
Equity 17,555 2,225 788 128 52 20,747
Number
of
Employees 53,277 4,751 1,455 394 450 60,327
Number of
Clients
(thousand) 17,224 224 62 75 550 18,135
Number of
Branches
+ CSBs 3,202 73 50 15 23 3,363
Following the approval by the Brazilian, Chilean and Uruguayan
regulatory authorities and based on this Material Fact as well
as that of May 2, 2006, the operation is expected to have the
following effects:
Estimated Effects BankBoston BankBoston Total
Brazil Chile and
Uruguay
Issues of Banco Itau 68,518 20,537 89,055
Holding Financeira thousand thousand thousand
Shares preferred common shares
Bank of America's
stake in Banco Itau
Holding Financeira 5.82% 1.72% 7.44%
Goodwill amortization
on Banco Itau BRL(2,433) BRL(401) BRL(2,834)
Holding Financeira Million Million Million
Cash Disbursement 0 BRL2.3 BRL 2.3
Million Million
Equity Income Result BRL531 BRL279 BRL 810
at Itausa Million Million Million
These acquisitions are consistent with the allocation of Itau's
capital stock to businesses that create stockholder value, with
a view to the Bank's sustainable growth and reaffirm Itau's
confidence in the region.
The operation's completion is subject to approval by the
appropriate regulatory authorities in Brazil, Chile and Uruguay.
About Banco Itau
Banco Itau currently has 51 thousand employees serving more than
16 million clients, through its network of 2,391 branches and 22
thousand ATMs.
* * *
Fitch Ratings upgraded on July 2, 2006, these ratings of Banco
Itau Holding Financeira S.A.:
-- Foreign currency long-term IDR to BB from BB-;
-- Local currency long-term IDR to BBB- from BB+; and
-- National long-term rating to 'AA+(bra)' from 'AA(bra)'.
Standard & Poor's Ratings Services raised on May 20, 2006, its
long-term counterparty credit rating on Banco Itau S.A. to 'BB+'
from 'BB'. S&P said the outlook is stable.
* URUGUAY: Inks Accord with Cuba's Chamber of Commerce
------------------------------------------------------
Uruguay's Managerial Chamber of Maldonado province signed a
cooperation pact with Cuba's Chamber of Commerce, Prensa Latina
reports.
Prensa Latina relates that the accord is aimed at encouraging
relations between parties.
The agreement was a result of negotiations the Cuban Chamber of
Commerce organized, Juan Pigola, the chairperson of the
Maldonado Managerial Chamber, told the local press.
Mr. Pigola said that the initiative was considered interesting
by Maldonado's entrepreneurs, as it was the first time in 20
years that an institution in Uruguay was invited to participate
in this kind of negotiation, Prensa Latina states.
* * *
Fitch Ratings assigned these ratings on Uruguay:
Rating Rating Date
------ -----------
Country Ceiling BB- Mar. 7, 2005
Long Term IDR B+ Dec. 14, 2005
Short Term IDR B Dec. 14, 2005
Local Currency
Long Term Issuer
Default Rating BB- Mar. 7, 2005
=================
V E N E Z U E L A
=================
CITGO: Faces Charges on Violations of Environmental Regulation
--------------------------------------------------------------
The United States Department of Justice brought criminal charges
against Citgo Petroleum Corp., its unit Citgo Refining and
Chemicals Co., and Phile Vrazel -- the Citgo manager
environmental compliance at the Corpus Christi plant -- with
criminal violations of the Clean Air Act or CAA and the
Migratory Bird Treaty Act or MBTA.
As a result of a joint investigation by EPA, the US Fish and
Wildlife Service, the Federal Bureau of Investigation, the Texas
Parks and Wildlife Division and the Texas Commission on
Environmental Quality, Citgo was indicted on:
-- operating its refinery in Corpus Christi in violation of
the National Emission Standard for Benzene Waste
Operations; and
-- operating open top tanks as oil water separators without
first installing the emission controls required by
federal and state regulations.
The CAA regulations require Citgo to control the emission of
benzene from wastewater produced at the refinery.
Benzene is a hazardous air pollutant found to cause cancer in
people exposed to small amounts of the chemical.
The US congress passed the CAA, and the Environmental Protection
Agency or EPA prescribed regulations governing the operation of
refineries to limit the amount of benzene that can potentially
be emitted to the atmosphere at the facilities.
According to the indictment, Citgo operated its Corpus Christi
refinery in 2000 with more than 57 megagrams of benzene in waste
streams that were exposed to the air. A megagram is equal to
one metric ton. Federal regulations limit refineries to
operating with no more than six megagrams of benzene in their
exposed waste streams. Citgo is also charged with operating in
2001 with more than seven megagrams of benzene in its exposed
waste streams.
Regulations governing the construction and operation of new
sources of hazardous air pollutants require oil water separators
to be fitted with emission control devices to prevent the
release of benzene and other harmful chemicals into the
environment. Citgo allegedly used two large open top tanks as
oil water separators between January 1994 and May 2003 without
the required emission controls. During an unannounced
inspection in March 2002, TCEQ inspectors found 4.5 million
gallons of oil in the two open top tanks.
Mr. Vrazel was charged for failing to identify in a report filed
with the Texas Commission on Environmental Quality or TCEQ for
the year 2000 all of the points in the refinery wastewater
system where a potentially harmful chemical, benzene, was
generated. An accurate report is required by regulations to be
filed with the TCEQ yearly.
Citgo Refining and Vrazel have also violated the MBTA for the
illegal taking of protected birds. The birds were found coated
with oil as a result of landing in the open top tanks. Because
the tanks attract birds, they must be fitted with nets or other
equipment to prevent the birds from entering or landing in the
oil. The MBTA implements international treaties that protect
birds, which migrate between nations by requiring permits and
placing limits on the taking of certain species.
If convicted, Citgo would be fined up to US$500,000 or twice the
gross economic gain -- whichever is greater -- and five years of
probation. Mr. Vrazel would be fined up to US$500,000 and up to
five years in prison.
However, Citgo is confident that once the evidence is heard and
the judicial process concluded, no criminal conduct will be
found. The company will defend itself vigorously against the
charges.
Citgo, relying on the wording of the regulation, Environmental
Protection Agency or EPA memoranda on the subject, and the
advice of expert legal counsel retained in 1999, has always
believed that the regulation does not apply to the tanks. There
is no legal precedent supporting the government's position on
this issue.
Since at least 1993, Citgo had advised state and federal
regulators, including the EPA, as to the method by which it was
calculating the amount of benzene present in certain wastewater
streams at the refinery. Citgo advised several inspectors from
the state and EPA as to the method used. After a 1998
inspection, the EPA expressly found that Citgo was in compliance
with these regulations. In 2001, two years before the
government's investigation even began, Citgo changed its
methodology to the methodology the government now advocates.
Throughout the investigation leading to the charges, Citgo has
maintained its innocence and continues to maintain today that
none of these issues warrants criminal prosecution. At most,
they involve a good faith dispute over the interpretation of
highly complex and vague environmental regulations. Moreover,
throughout the protracted investigation, Citgo and its employees
have fully cooperated with the authorities.
Citgo said it takes its environmental responsibilities seriously
and that, in fact, its Corpus Christi refinery has in the past
won an award from the EPA for environmental excellence.
Senior Litigation Counsel Howard P. Stewart of the Justice
Department's Environmental Crimes Section and William R. Miller,
special assistant U.S. attorney for the Southern District of
Texas, administer the case.
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 in the Troubled Company Reporter on Feb. 16, 2006,
Standard and Poor's Ratings Services assigned a 'BB' rating on
Citgo Petroleum Corp.
ELECTRICIDAD DE CARACAS: Increases Capital by 5% in 2006
--------------------------------------------------------
Julian Nebreda, the head of Electricidad de Caracas, told
reporters that the company has raised its capital by 5% this
year through three share issues and is planning more.
Mr. Nebreda told Business News Americas that the first issue for
80-plus million common shares was oversubscribed 4.42 times.
The second for 60 million shares was oversubscribed 3.5 times.
According to BNamericas, Mr. Nebreda did not rule out the
possibility of a third issue.
"Earlier this year, shareholders told us we could increase
capital 5% through special programs. These are the two issues I
mentioned. Now we can increase some more by other non-special
programs, for which we have a broader mandate from
stockholders," Mr. Nebreda told BNamericas.
Electricidad de Caracas currently has about 50,000 shareholders,
the report states, citing Mr. Nebreda, who added that the number
is not likely to reach 100,000 this year, but maybe in 2007.
Workers of Electricidad de Caracas purchased about 6.2 million
shares this year and will have a chance to option for a similar
amount before this year ends, BNamericas states.
Electricidad de Caracas is a vertically integrated utility in
Venezuela, operating in electricity distribution, transmission,
and generation in the capital city of Caracas and its
metropolitan area.
It is the largest private electric utility in the country and is
owned by US-based AES Corp. (B+/Positive/--). EDC reported net
profits of US$20.6 million from January to March, versus net
losses of US$26.9 the same period in 2005.
* * *
On Feb 9, 2006, Standard & Poor's Ratings Services affirmed its
'B' long-term corporate credit rating on C.A. La Electricidad de
Caracas aka EDC and its 'B' rating on Electricidad de Caracas
Finance B.V.'s US$260 million senior unsecured notes. S&P said
the outlook is stable.
On Feb. 3, 2006, S&P raised the long-term local and foreign
currency sovereign credit ratings on the Bolivarian Republic of
Venezuela to 'BB-' from 'B+'. The decision to raise the ratings
on Venezuela was supported by the continued sharp improvements
in Venezuela's external indicators, which are attributable to a
large current account surplus, a high level of international
reserves, and lower external debt in addition to buoyant
economic growth and the potential buyback of external debt.
ELECTRICIDAD DE CARACAS: Will Allocate VEB72 Billion to Pay Debt
----------------------------------------------------------------
Executives of Electricidad de Caracas told Business News
Americas that the firm will allot about VEB72 billion to pay
debt.
BNamericas notes that Electricidad de Caracas made the amount
from three common stock issues, two of which took place between
July and August. In a separate transaction, workers of
Electricidad purchased about 6.2 million shares.
Andres Paffen, the CFO of Electricidad de Caracas, told
BNamericas that the company had about US$1.2 billion in debt
when the AES Corp. acquired it in 2001.
According to BNamericas, Electricidad de Caracas' total debt was
US$342 million, which the company aims to decrease to US$310
million this year.
Electricidad de Caracas will also use the money in completing up
to two new generation projects, BNamericas reports, citing the
company officials.
The La Raisa thermal generation plant, whose construction began
in the Tuy river valley last month, is designed to add 200
megawatts (MW) to the 2,600MW-plus generation capacity of
Electricidad de Caracas.
Due to the entry of additional funds, reduced rates and lower
inflation, the company could accelerate other generation
projects like El Sitio, which is also planned near Caracas,
BNamericas relates, citing Julian Nebreda, the president of
Electricidad de Caracas.
"We are accelerating some investments plans. A team from
Venezuela is visiting with our affiliate AES Gener in Chile,
studying methods for the rapid construction of thermal
generation facilities," Mr. Nebreda told BNamericas.
Electricidad de Caracas is a vertically integrated utility in
Venezuela, operating in electricity distribution, transmission,
and generation in the capital city of Caracas and its
metropolitan area.
It is the largest private electric utility in the country and is
owned by US-based AES Corp. (B+/Positive/--). EDC reported net
profits of US$20.6 million from January to March, versus net
losses of US$26.9 the same period in 2005.
* * *
On Feb 9, 2006, Standard & Poor's Ratings Services affirmed its
'B' long-term corporate credit rating on C.A. La Electricidad de
Caracas aka EDC and its 'B' rating on Electricidad de Caracas
Finance B.V.'s US$260 million senior unsecured notes. S&P said
the outlook is stable.
On Feb. 3, 2006, S&P raised the long-term local and foreign
currency sovereign credit ratings on the Bolivarian Republic of
Venezuela to 'BB-' from 'B+'. The decision to raise the ratings
on Venezuela was supported by the continued sharp improvements
in Venezuela's external indicators, which are attributable to a
large current account surplus, a high level of international
reserves, and lower external debt in addition to buoyant
economic growth and the potential buyback of external debt.
* Upcoming Meetings, Conferences and Seminars
---------------------------------------------
August 15, 2006
TURNAROUND MANAGEMENT ASSOCIATION
DIP Panel Discussion
Kansas City, Missouri
Contact: http://www.turnaround.org/
August 16, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Family Night Baseball with the NJ Jackals
(Yogi Berra Autograph Night)
Jackals Stadium, Montclair, New Jersey
Contact: 908-575-7333 or
http://www.turnaround.org/
August 25, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Annual Fishing Trip
Point Pleasant, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
August 29, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
Citrus Club, Orlando, Florida
Contact: 561-882-1331 or http://www.turnaround.org/
September 6, 2006
TURNAROUND MANAGEMENT ASSOCIATION
4th Annual Alberta Golf Tournament
Kananaskis Country Golf Course, Kananaskis, Alberta
Contact: 403-294-4954 or http://www.turnaround.org/
September 7, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Business Mixer
TBA, Seattle, Washington
Contact: 503-223-6222 or http://www.turnaround.org/
September 7-8, 2006
EUROMONEY
Leveraged Finance
Hotel Rey Juan Carlos I, Barcelona, Spain
Contact: http://www.euromoneyplc.com/
September 7-8, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Saratoga Regional Conference
Gideon Putnam Hotel, Saratoga Springs, New York
Contact: http://www.turnaround.org/
September 7-9, 2006
AMERICAN BANKRUPTCY INSTITUTE
Southwest Bankruptcy Conference
Wynn Las Vegas, Las Vegas, Nevada
Contact: 1-703-739-0800; http://www.abiworld.org/
September 8-9, 2006
AMERICAN BANKRUPTCY INSTITUTE
International Insolvency Symposium
London, England
Contact: http://www.turnaround.org/
September 13, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast Meeting
Marriott Tyson's Corner, Vienna, Virginia
Contact: 703-912-3309 or http://www.turnaround.org/
September 13, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Networking Breakfast
TBA, Secaucus, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
September 13, 2006
TURNAROUND MANAGEMENT ASSOCIATION
LI Turnaround Formal Event
Long Island, New York
Contact: http://www.turnaround.org/
September 13, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Networking Function
Sydney, Australia
Contact: 0438 653 179 or http://www.turnaround.org/
September 13, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Formal Event - Major Speaker to be Announced
Long Island, New York
Contact: 631-251-6296 or http://www.turnaround.org/
September 13-15, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Texas Regional Conference
Hyatt Regency Resort & Spa
Lost Pines, TX
Contact: 870-760-7116 or
http://www.turnaround.org/
September 14, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Kick-Off Reception
Westin Buckhead, Atlanta, GA
Contact: 678-795-8103 or http://www.turnaround.org/
September 15, 2006
TURNAROUND MANAGEMENT ASSOCIATION
BOK Review - Management
Gardner Carton & Douglas, Chicago, IL
Contact: 815-469-2935 or http://www.turnaround.org/
September 17-24, 2006
NATIONAL ASSOCIATION OF BANKRUPTCY TRUSTEES
Optional Alaska Cruise
Seattle, Washington
Contact: 800-929-3598 or http://www.nabt.com/
September 19-20, 2006
STRATEGIC RESEARCH INSTITUTE
2nd Annual Euro Distressed Debt Summit
Le Meridien Parkhotel, Frankfurt, Germany
Contact: http://www.srinstitute.com/
September 20, 2006
TURNAROUND MANAGEMENT ASSOCIATION
South Florida Dinner
Bankers Club, Miami, Florida
Contact: 561-882-1331 or http://www.turnaround.org/
September 21, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Restructuring Workshop With US
Bankruptcy Judges Hale, Nelms and Lynn
Belo Mansion - The Pavilion, Dallas, TX
Contact: http://www.turnaround.org/
September 24, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Restructuring the Troubled High Tech Company
Arizona
Contact: http://www.turnaround.org/
September 26, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
Centre Club, Tampa, Florida
Contact: 561-882-1331 or http://www.turnaround.org/
September 27, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Joint Education Program with NYIC Joint Reception
CFA/RMA/IWIRC
Woodbridge Hilton, Iselin, NJ
Contact: http://www.turnaround.org/
September 27, 2006
TURNAROUND MANAGEMENT ASSOCIATION
7th Annual Cross Border Business Restructuring and
Turnaround Conference
Banff, Alberta
Contact: http://www.turnaround.org/
October 5, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Commercial Lenders Breakfast
Sydney, Australia
Contact: 0438 653 179 or http://www.turnaround.org/
October 10, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast Meeting
Center Club, Baltimore, Maryland
Contact: 703-912-3309 or http://www.turnaround.org/
October 11, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Professional Development Meeting
Sydney, Australia
Contact: 0438 653 179 or http://www.turnaround.org/
October 11-14, 2006
TURNAROUND MANAGEMENT ASSOCIATION
2006 Annual Conference
Milleridge Cottage, Long Island, New York
Contact: 312-578-6900; http://www.turnaround.org/
October 12, 2006
TURNAROUND MANAGEMENT ASSOCIATION
UTS Fundamentals of Turnaround Management
Mecure Hotel - Haymarket, Sydney, Australia
Contact: http://www.turnaround.org/
October 17, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Updates on the New Bankruptcy Law
Kansas City, Missouri
Contact: http://www.turnaround.org/
October 19, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Billards Networking Night - Young Professionals
TBA, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
October 26, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Hedge Funds - Expanded Financing Opportunities in Business
Turnarounds
Arizona
Contact: http://www.turnaround.org/
October 26, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast Speaker Series #3
TBA, Calgary, Alberta
Contact: 403-294-4954 or http://www.turnaround.org/
October 26, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast Speaker Series #3
TBA, Calgary, Alberta
Contact: 403-294-4954 or http://www.turnaround.org/
October 27, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast with Coach Dan Reeves
Westin Buckhead, Atlanta, GA
Contact: 678-795-8103 or http://www.turnaround.org/
October 28, 2006
TURNAROUND MANAGEMENT ASSOCIATION
BK/TMA Golf Tournament
Orange Tree Golf Resort, AZ
Contact: 623-581-3597 or http://www.turnaround.org/
October 30-31, 2006
Distressed Debt Summit: Preparing for the Next Default Cycle
Financial Research Associates LLC
Helmsley Hotel, New York, NY
Contact: http://www.frallc.com/
October 31, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
Citrus Club, Orlando, Florida
Contact: 561-882-1331 or http://www.turnaround.org/
October 31 - November 1, 2006
INTERNATIONAL WOMEN'S INSOLVENCY & RESTRUCTURING
CONFEDERATION
IWIRC Annual Conference
San Francisco, California
Contact: http://www.iwirc.com/
November 1, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Halloween Isn't Over! - Ghosts of turnarounds past who
remind you about what you should have done differently
Portland, Oregon
Contact: http://www.turnaround.org/
November 1-4, 2006
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
San Francisco, California
Contact: http://www.ncbj.org/
November 2-3, 2006
BEARD GROUP & RENAISSANCE AMERICAN CONFERENCES
Third Annual Conference on Physician Agreements & Ventures
Successful Strategies for Medical Transactions and
Investments
The Millennium Knickerbocker Hotel - Chicago
Contact: 903-595-3800; 1-800-726-2524;
http://www.renaissanceamerican.com/
November 7, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Networking Breakfast
Marriott, Bridgewater, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
November 8, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast Meeting
Marriott Tyson's Corner, Vienna, Virginia
Contact: 703-912-3309 or http://www.turnaround.org/
November 8, 2006
TURNAROUND MANAGEMENT ASSOCIATION
TMA Australia National Conference
Sydney, Australia
Contact: http://www.turnaround.org/
November 14, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon Program
St. Louis, Missouri
Contact: 815-469-2935 or http://www.turnaround.org/
November 15, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Joint Reception with NYIC/NYTMA
TBA, New York
Contact: 908-575-7333 or http://www.turnaround.org/
November 15, 2006
LI TMA Formal Event
TMA Australia National Conference
Long Island, New York
Contact: http://www.turnaround.org/
November 15, 2006
TURNAROUND MANAGEMENT ASSOCIATION
South Florida Dinner
Citrus Club, Orlando, Florida
Contact: 561-882-1331 or http://www.turnaround.org/
November 16, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Bankruptcy Judges Panel
Duquesne Club, Pittsburgh, Pennsylvania
Contact: http://www.turnaround.org/
November 16, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Dinner Program
TBA, Seattle, Washington
Contact: 503-223-6222 or http://www.turnaround.org/
November 23, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Martini Party
Vancouver, British Columbia
Contact: 403-294-4954 or http://www.turnaround.org/
November 27-28, 2006
BEARD GROUP & RENAISSANCE AMERICAN CONFERENCES
Thirteenth Annual Conference on Distressed Investing
Maximizing Profits in the Distressed Debt Market
The Essex House Hotel - New York
Contact: 903-595-3800; 1-800-726-2524;
http://www.renaissanceamerican.com/
November 28, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Luncheon
Centre Club, Tampa, FL
Contact: 561-882-1331 or http://www.turnaround.org/
November 29, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Special Program
TBA, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
November 29, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Turnaround Industry Trends
Jasna Polana, Princeton, NJ
Contact: http://www.turnaround.org/
November 30-December 2, 2006
AMERICAN BANKRUPTCY INSTITUTE
Winter Leadership Conference
Hyatt Regency at Gainey Ranch, Scottsdale, Arizona
Contact: 1-703-739-0800; http://www.abiworld.org/
December 6, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Holiday Dinner
Portland, Oregon
Contact: 503-223-6222 or http://www.turnaround.org/
December 7, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Networking Breakfast
The Newark Club, Newark, New Jersey
Contact: 908-575-7333 or http://www.turnaround.org/
December 13, 2006
TURNAROUND MANAGEMENT ASSOCIATION
LI TMA Holiday Party
TBA, Long Island, New York
Contact: 631-251-6296 or http://www.turnaround.org/
December 13, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Christmas Function
GE Commercial Finance, Sydney, Australia
Contact: 0438 653 179 or http://www.turnaround.org/
December 20, 2006
TURNAROUND MANAGEMENT ASSOCIATION
Holiday Extravaganza - TMA, AVF & CFA
Georgia Aquarium, Atlanta, GA
Contact: 678-795-8103 or http://www.turnaround.org/
January 12, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Annual Lender's Panel Breakfast
Westin Buckhead, Atlanta, GA
Contact: http://www.turnaround.org/
February 8-11, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Certified Turnaround Professional (CTP) Training
NY/NJ
Contact: http://www.turnaround.org/
February 2007
AMERICAN BANKRUPTCY INSTITUTE
International Insolvency Symposium
San Juan, Puerto Rico
Contact: 1-703-739-0800; http://www.abiworld.org/
March 15, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Martini Madness Cocktail Reception with Geraldine Ferraro
Westin Buckhead, Atlanta, GA
Contact: 678-795-8103 or http://www.turnaround.org/
March 15-18, 2007
NATIONAL ASSOCIATION OF BANKRUTPCY TRUSTEES
NABT Spring Seminar
Ritz-Carlton Buckhead, Atlanta, GA
Contact: http://www.NABT.com/
March 27-31, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Spring Conference
Four Seasons Las Colinas, Dallas, Texas
Contact: http://www.turnaround.org/
March 29-31, 2007
ALI-ABA
Chapter 11 Business Reorganizations
Scottsdale, Arizona
Contact: 1-800-CLE-NEWS; http://www.ali-aba.org/
April 11-15, 2007
AMERICAN BANKRUPTCY INSTITUTE
ABI Annual Spring Meeting
J.W. Marriott, Washington, DC
Contact: 1-703-739-0800; http://www.abiworld.org/
April 20, 2007
TURNAROUND MANAGEMENT ASSOCIATION
Breakfast meeting with Chapter President, Bruce Sim
Westin Buckhead, Atlanta, GA
Contact: 678-795-8103 or http://www.turnaround.org/
June 6-9, 2007
ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS
23rd Annual Bankruptcy & Restructuring Conference
Westin River North, Chicago, Illinois
Contact: http://www.airacira.org/
June 14-17, 2007
AMERICAN BANKRUPTCY INSTITUTE
Central States Bankruptcy Workshop
Grand Traverse Resort, Traverse City, Michigan
Contact: 1-703-739-0800; http://www.abiworld.org/
July 12-15, 2007
AMERICAN BANKRUPTCY INSTITUTE
Northeast Bankruptcy Conference
Marriott, Newport, RI
Contact: 1-703-739-0800; http://www.abiworld.org/
October 10-13, 2007
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
Orlando, Florida
Contact: http://www.ncbj.org/
October 16-19, 2007
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott Copley Place, Boston, Massachusetts
Contact: 312-578-6900; http://www.turnaround.org/
December 6-8, 2007
AMERICAN BANKRUPTCY INSTITUTE
Winter Leadership Conference
Westin Mission Hills Resort, Rancho Mirage, California
Contact: 1-703-739-0800; http://www.abiworld.org/
March 25-29, 2008
TURNAROUND MANAGEMENT ASSOCIATION
TMA Spring Conference
Ritz Carlton Grande Lakes, Orlando, Florida
Contact: http://www.turnaround.org/
September 24-27, 2008
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
Scottsdale, Arizona
Contact: http://www.ncbj.org/
October 28-31, 2008
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott Copley Place, Boston, Massachusetts
Contact: 312-578-6900; http://www.turnaround.org/
October 5-9, 2009
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott Desert Ridge, Phoenix, Arizona
Contact: 312-578-6900; http://www.turnaround.org/
2009 (TBA)
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
Las Vegas, Nevada
Contact: http://www.ncbj.org/
October 4-8, 2010
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
JW Marriott Grande Lakes, Orlando, Florida
Contact: http://www.turnaround.org/
2010 (TBA)
NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
National Conference of Bankruptcy Judges
New Orleans, Louisiana
Contact: http://www.ncbj.org/
BEARD AUDIO CONFERENCES
Coming Changes in Small Business Bankruptcy
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Distressed Real Estate under BAPCPA
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
High-Yield Opportunities in Distressed Investing
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Fundamentals of Corporate Bankruptcy and Restructuring
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Reverse Mergers - the New IPO?
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Dana's Chapter 11 Filing
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Employee Benefits and Executive Compensation
under the New Code
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Validating Distressed Security Portfolios: Year-End Price
Validation and Risk Assessment
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Changing Roles & Responsibilities of Creditors' Committees
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Calpine's Chapter 11 Filing
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Healthcare Bankruptcy Reforms
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
Changes to Cross-Border Insolvencies
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com/
BEARD AUDIO CONFERENCES
The Emerging Role of Corporate Compliance Panels
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com
BEARD AUDIO CONFERENCES
Privacy Rights, Protections & Pitfalls in Bankruptcy
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com
BEARD AUDIO CONFERENCES
High-Yield Opportunities in Distressed Investing
Audio Conference Recording
Contact: 240-629-3300;
http://www.beardaudioconferences.com
The Meetings, Conferences and Seminars column appears in the
Troubled Company Reporter each Wednesday. Submissions via e-mail
to conferences@bankrupt.com are encouraged.
***********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter - Latin America is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Fairless
Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick,
Maryland USA. Marjorie C. Sabijon, Sheryl Joy P. Olano, Stella
Mae Hechanova, and Christian Toledo, Editors.
Copyright 2006. All rights reserved. ISSN 1529-2746.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without
prior written permission of the publishers.
Information contained herein is obtained from sources believed
to be reliable, but is not guaranteed.
The TCR Latin America subscription rate is US$575 per half-year,
delivered via e-mail. Additional e-mail subscriptions for
members of the same firm for the term of the initial
subscription or balance thereof are US$25 each. For
subscription information, contact Christopher Beard at 240/629-
3300.
* * * End of Transmission * * *