/raid1/www/Hosts/bankrupt/TCRLA_Public/070314.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
L A T I N A M E R I C A
Wednesday, March 14, 2007, Vol. 8, Issue 52
Headlines
A R G E N T I N A
BANCO DE GALICIA: Postpones Capital Increase of ARS100 Million
GETTY IMAGES: Acquires Scoopt to Enhance Site Features
TENNECO INC: Earns US$51 Million in Year Ended December 31, 2006
B A H A M A S
4114 LTD: Will Hold Last Shareholders Meeting on April 6
GENERAL NUTRITION: Prices Offering of US$410 Mil. Senior Notes
HARRAH'S ENTERTAINMENT: Earns US$47MM in Quarter Ended Dec. 31
REGIONAL SALES: Will Hold Last Shareholders Meeting on April 9
WINN-DIXIE STORES: Wants Final Decree Entered on 23 Cases
B E R M U D A
REFCO: Administrators Want Claims Bar Date Extended to Apr. 30
REFCO INC: Crisis Managers Want US$7.4 Mil. in Success Fees Paid
TK ALUMINUM: Noteholders Agree to Amend Senior Note Indenture
B O L I V I A
* BOLIVIA: La Paz Crude Production Can't Meet Demand
* BOLIVIA: Hydrocarbon Nationalization Won't Scare Off Investors
* BOLIVIA: Lower House To Vote on Bill to Correct Oil Deals
B R A Z I L
BAUSCH & LOMB: U.S. Operations Likely to be Unprofitable
BLOCKBUSTER INC: Earns US$54.7 Million in Full Year 2006
BROWN SHOE: Earns US$13.6 Million in Quarter Ended Feb. 3, 2007
DURA AUTOMOTIVE: Wants Allied Move Consigned Stock Pact Assumed
DURA AUTOMOTIVE: To Make Interim Payments to Junior KMIP Members
FIAT SPA: Indicates Hitting Sales Target for Bravo Compact
HERCULES INC: Earns US$238.7 Million in Full Year 2006
HUDSON HIGHLAND: Will Restate 2006 & 2005 Financial Results
WEIGHT WATCHERS: Board Declares US$0.175 Per Share Cash Dividend
C A Y M A N I S L A N D S
ATSUGI LOGISTICS: Sets Last Shareholders Meeting for April 6
BANCO BRADESCO: Grand Cayman Unit Issues US$200-Million of Bonds
CITIGROUP CREDIT: Will Hold Last Shareholders Meeting on April 9
DABENREAL INDUSTRIES: Sets Last Shareholders Meeting for April 6
MAYMIN FUND: Proofs of Claim Filing Ends on April 6
MAYMIN MASTER: Proofs of Claim Filing Deadline Is April 6
MEADS COMPANY: Sets Last Shareholders Meeting for April 6
TRINITY INVESTMENT: Sets Last Shareholders Meeting for April 6
UBS PACTUAL: Fitch Affirms & Withdraws Ratings
C H I L E
ROYAL & SUNALLIANCE: A.M. Best Cuts Financial Strength Ratings
C O L O M B I A
BANCOLOMBIA: Reports COP80 Billion Net Income in February 2007
* COLOMBIA: Scrap Sale Brings in Over COP5.7 Billion
C O S T A R I C A
ALCATEL-LUCENT: CEO Predicts Revenue Growth During Restructuring
C U B A
SHERRITT INTERNATIONAL: Will Export Cuban Oil
D O M I N I C A N R E P U B L I C
* DOMINICAN REPUBLIC: Montecristi, Samana Towns Want AES Money
E C U A D O R
* ECUADOR: Allots US$15MM Emergency Fund for Highway Works
* ECUADOR: Mulls Tender Process for Guayaquil Port Concession
* ECUADOR: To Make Timely Payment on Debts, Minister Patino Says
E L S A L V A D O R
SPECTRUM BRANDS: Gets US$1.6-Bil. Pledge to Refinance Bank Loan
G U A T E M A L A
BRITISH AIRWAYS: Eyes 5-6 Percent Revenue Increase in 2007-2008
J A M A I C A
AIR JAMAICA: IMF Still Recommends Airline's Closure
* JAMAICA: Trinidad Wants Venezuela to Supply Nation with LNG
* JAMAICA: US$350-Million of Bonds Issued Over-Subscribed
M E X I C O
COTT CORP: Revenues Rise to US$400.1 Mil. in 2006 Fourth Quarter
COTT CORP: Names Juan Figuereo as Chief Financial Officer
DAIMLERCHRYSLER AG: Shareholders Want Chrysler Deal Investigated
DAIMLERCHRYSLER AG: Sells EUR2 Bil. 4.375% Bonds Due March 2010
DOMINO'S PIZZA: Accepts US$30 Per Share Tender Offer
GENERAL MOTORS: Will Release 2006 Financial Results Today
GENERAL MOTORS: May Incur US$1B Charge from Bad Mortgage Loans
INTERNATIONAL RECTIFIER: Fitch Ups Debt Rating One Notch to BB+
MERIDIAN AUTOMOTIVE: Trustee Wants Beneficiary Record Date Fixed
MERIDIAN AUTOMOTIVE: EPA Wants US$9MM in Clean Air Act Penalties
US STEEL: CEO Accepts China's Plan to Close Plants a "Good Step"
VISTEON CORP: Posts US$163 Million Net Loss in Full-Year 2006
* MEXICO: Local Exchange May Conduct IPO in October
P A N A M A
CHIQUITA BRANDS: Names Vanessa Vargas-Land as Vice President
P E R U
CHARLES RIVER: Incurs US$55.7 Mln Net Loss in Year Ended Dec. 31
* PERU: Perupetro Inks Block Z-34 Exploration & Production Pact
P U E R T O R I C O
BITHORN TRAVEL: Voluntary Chapter 11 Case Summary
DRESSER INC: Riverstone Leads Investor Group in Buying Assets
DRESSER: Sale Cues Moody's Ratings Review for Likely Downgrade
NEWCOMM WIRELESS: Court OKs US$103.2MM Asset Sale to PR Wireless
NEWCOMM WIRELESS: Panel Hires Falkenberg as Financial Advisors
U R U G U A Y
NAVIOS MARITIME: Secures Five-Year Time Charter Contract
* URUGUAY: Warns of Status Demotion in Mercosur Trade Bloc
V E N E Z U E L A
DAIMLERCHRYSLER: Chrysler Group to Recall Over 489,000 Vehicles
* VENEZUELA: Confirms Resumption of Costa Rican Plant Operations
* VENEZUELA: ExxonMobil to Surrender Oil Project to Gov't
* VENEZUELA: Ministry Forms New Office to Record Oil Output
* BOND PRICING: For the Week March 5 to March 9, 2007
* Large Companies with Insolvent Balance Sheets
- - - - -
=================
A R G E N T I N A
=================
BANCO DE GALICIA: Postpones Capital Increase of ARS100 Million
--------------------------------------------------------------
Banco de Galicia said in a filing with the Buenos Aires stock
exchange that it has postponed for the third time a capital
raise of up to ARS100 million.
Business News Americas relates that the capital increase has
been delayed since December 2006 because the Argentine central
bank has not approved it.
A Banco de Galicia spokesperson told BNamericas early this month
that the bank expected to complete the transaction in April, as
the central bank's authorization will be granted within this
month.
According to BNamericas, the capital raise will see Banco de
Galicia issue up to 100 million B class shares at a nominal
value of ARS1 each.
Banco de Galicia told BNamericas that Grupo Financiero Galicia,
which owns 94% of the bank, will likely subscribe the capital
increase through bonds issued by the bank maturing in 2014.
Headquartered in Buenos Aires, Argentina, Banco de Galicia y
Buenos Aires SA -- http://www.e-galicia.com/-- is an
Argentinean private bank that is engaged in commercial banking,
providing general banking services to large corporations, small
and medium-sized companies, agricultural and cattle farms and
individuals. The company controls an extensive and diverse
network of subsidiaries, which include Banco Galicia Uruguay SA,
Galicia Capital Markets SA, Galicia Factoring y Leasing SA, Agro
Galicia SA, Galicia Administradora de Fondos SA, Galicia Valores
SA, Galicia Warrants SA, Net Investments SA, Sudamericana
Holding SA and Tarjetas Regionales SA. Through its subsidiaries
the company offers accounting, investment and insurance
services, loans, checks and debit and credit cards. It also
finances the development of real estate, acts as a fiduciary and
leases properties to interested parties. It operates over 400
branches across the country and provides e-banking services to
customers via its Internet site.
* * *
As reported in the Troubled Company Reporter-Latin America on
Feb. 23, 2007, Banco de Galicia y Buenos Aires' Obligaciones
Negociables issued on Nov. 6, 2001, for the original amount of
US$12 million was rated D by the Argentine arm of Standard &
Poor's International Ratings.
GETTY IMAGES: Acquires Scoopt to Enhance Site Features
------------------------------------------------------
Getty Images Inc. disclosed its acquisition of Scoopt, an
emerging source for user-generated editorial content. Scoopt is
an aggregator and distributor of photographs and videos captured
by eyewitnesses who have an accidental front row seat to
headline-making moments.
In the coming months, news, sport and entertainment imagery from
Scoopt that meets Getty Images' stringent editorial quality
standards will be released exclusively at
http://www.gettyimages.com/editorial,where it will benefit from
worldwide visibility and promotional support. Additionally,
Getty Images will invest in technology upgrades and other
enhancements to Scoopt in order to make the site more accessible
to customers, and to better position it for future growth.
"New technology has made it easier to capture and distribute
imagery, leading to citizen photojournalism that is increasingly
relevant to the news cycle," said Jonathan Klein, co-founder and
CEO of Getty Images. "While this genre will never replace the
award-winning photojournalism for which we're known, it's a
highly complementary offering that enables us to meet the
evolving imagery needs of a broad customer base."
Since the founding of Scoopt in 2005, the site has supplied the
media with arresting imagery from major world events, including:
* The tragic Manhattan plane crash that killed New York
Yankees pitcher Cory Lidle and his flight instructor in
October 2006; digital images captured by a bystander were
emailed to Scoopt and appeared on the front page of The
Times of London
* Fierce January 2006 storms in the U.K., which brought
devastation and disruption to large parts of the country
"User-generated content is serving a valuable role in today's
communication landscape; safeguards to validate its authenticity
are critical," said Hugh Pinney, director of Editorial
Photography at Getty Images. "By implementing rigorous quality
standards, we can deliver powerful imagery captured from a
unique perspective while ensuring journalistic integrity."
Citizen photographers who submit imagery to Scoopt retain
copyright while granting the agency a 12-month exclusive license
that authorizes re-license to one or more publishers.
Contributors will benefit from increased visibility and an
extensive network of media contacts, earning a significant
percentage of the value for each license issued. Both Getty
Images and Scoopt encourage contributors to be respectful and
follow a code of ethics for image capture. Submission
guidelines and additional details about Scoopt's growing
photographer community can be found at http://www.scoopt.com.
Getty Images plans to fully integrate Scoopt into its
organization, harnessing the team's knowledge of user-generated
editorial content. "We're very much looking forward to taking
our business to the next level by collaborating with the world's
leading imagery provider," said Kyle MacRae, founder of Scoopt.
"This acquisition will exponentially expand our customer base
and establish a strong foundation for long-term growth."
The Scoopt team will continue to operate out of the site's base
in Glasgow, Scotland, servicing customers under the leadership
of Getty Images' Hugh Pinney. Existing relationships with
Scoopt partners and affiliates will remain in place until
further notice.
Getty Images Inc. (NYSE: GYI) -- http://gettyimages.com/--
creates and distributes visual content and the first place
creative professionals turn to discover, purchase and manage
imagery. The company's award-winning photographers and imagery
help customers create inspiring work which appears every day in
the world's most influential newspapers, magazines, advertising
campaigns, films, television programs, books and Web sites.
Headquartered in Seattle, WA and serving customers in more than
100 countries, Getty Images believes in the power of imagery to
drive positive change, educate, inform, and entertain. The
company has corporate offices in Australia, the United Kingdom
and Argentina.
* * *
Moody's Investors Service upgraded the credit ratings of Getty
Images, Inc. and changed the ratings outlook to stable from
positive.
As reported on Dec. 4, 2006, Standard & Poor's Ratings Services
lowered its ratings on Seattle, Wash.-based visual imagery
company Getty Images Inc., including lowering the corporate
credit rating to 'B+' from 'BB', and placed the ratings on
CreditWatch with developing implications.
As of Sept. 30, 2006, Getty had US$265 million of convertible
notes outstanding.
TENNECO INC: Earns US$51 Million in Year Ended December 31, 2006
----------------------------------------------------------------
Tenneco Inc. reported net income of US$51 million on total
revenues of US$4.68 billion for the year ended Dec. 31, 2006,
versus a net income of US$58 million on total revenues of
US$4.44 billion for the year ended Dec. 31, 2005.
Excluding the impact of currency and substrate sales, revenue
was down US$58 million driven primarily by lower OE production
volumes in North America, particularly light trucks and SUVs,
partially offset by higher aftermarket sales.
Revenues from the company's North American operations decreased
by US$69 million in 2006 compared to the same period last year
reflecting lower sales in OE partially offset by increased
aftermarket sales. Revenues from the company's European, South
American, and Indian segments increased by US$252 million in
2006, compared to last year. Revenues from its Asia Pacific
segment, which includes Australia and Asia, increased to US$421
million in 2006, compared with US$360 million for the prior
year.
For the year 2006, total costs and expenses were US$4.48 billion
up from US$4.22 billion for 2005. The increase was primarily
driven by the rise in cost of sales to US$3.83 billion for 2006,
from US$3.58 billion a year ago.
Income taxes paid were US$3 million in 2006, compared with US$25
million in 2005. Included in the income taxes paid in 2006 were
benefits of US$16 million. The effective tax rate for 2006,
including the US$16 million of benefits, was 5%. Excluding
these benefits would have increased the company's effective tax
rate by 27%.
As of Dec. 31, 2006, the company listed US$3.26 billion in total
assets, US$3.01 billion in total liabilities, US$28 million in
minority interests, resulting in a total shareholders' equity of
US$221 million.
A full-text copy of the company's annual report is available for
free at http://ResearchArchives.com/t/s?1acc.
About Tenneco Inc.
Tenneco Inc., (NYSE: TEN) -- http://www.tenneco.com/-- is
headquartered in Lake Forest, Ill. It manufactures automotive
ride and emissions control products and systems for both the
worldwide original equipment market and aftermarket. Leading
brands include Monroe(R), Rancho(R), and Fric Rot ride control
products and Walker(R) and Gillet emission control products.
The company has global operations in Argentina, Japan, and
Germany, among others, with its European operations
headquartered in Brussels, Belgium.
* * *
Tenneco Inc. carries Moody's Ba3 Senior Secured Rating, B1 Long-
term Corporate Family Rating, Ba1 Bank Loan Debt Rating, B3
Subordinated Debt Rating, and B1 Probability of Default Rating.
Standard & Poor's gave the company a BB- Long-term Foreign and
Local Issuer Credit Rating and a B1- Short-term Foreign and
Local Issuer Credit Rating.
Fitch gave the company a BB- Long-term Issuer Default Rating, a
BB Senior Secured Debt Rating, a BB+ Bank Loan Debt Rating, and
a B Senior Subordinated Debt Rating.
=============
B A H A M A S
=============
4114 LTD: Will Hold Last Shareholders Meeting on April 6
--------------------------------------------------------
4114 Ltd. will hold its final shareholders meeting on
April 6, 2007, at:
Oceanic Bank And Trust Limited
TK House, Bayside Executive Park
West Bay St. And Blake Road
P.O. Box AP 59213
Nassau, Bahamas
These agendas 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 will be
allowed to appoint a proxy, who need not be a member, in his
stead.
The liquidator can be reached at:
Alpha Direction Ltd.
Oceanic Bank and Trust Limited
TK House, Bayside Executive Park
West Bay St. And Blake Road
P.O. Box AP 59213
Nassau, Bahamas
GENERAL NUTRITION: Prices Offering of US$410 Mil. Senior Notes
--------------------------------------------------------------
General Nutrition Centers, Inc., prices its offering of
US$300 million in aggregate principal amount of senior floating
rate toggle notes due 2014 and US$110 million in aggregate
principal amount of 10.75% senior subordinated notes due 2015.
The Senior Notes were issued at 99% of par, and the Senior Sub
Notes were issued at par.
The offering of the Notes is conditioned on the closing of the
agreement of GNC Parent Corporation to be acquired by an
affiliate of Ares Management LLC and the Ontario Teachers'
Pension Plan. The proceeds from the sale of the Notes, together
with borrowings by the company under a new senior term loan
facility, will be used to finance a portion of the transactions
in connection with the acquisition, including repayment of
certain of the company's existing debt.
Interest on the Senior Notes is payable and reset semiannually.
The company may elect to pay interest on the Senior Notes
entirely in cash, entirely by increasing the principal amount of
the Senior Notes or issuing new notes, or on 50% of the
outstanding principal amount of the Senior Notes in cash and on
50% of the outstanding principal amount of the Senior Notes in
PIK Interest. Cash interest on the Senior Notes will accrue at
six-month LIBOR plus 4.5%, and PIK Interest, if any, will accrue
at six-month LIBOR plus 5.25%. The Senior Sub Notes will bear
interest, payable semiannually and entirely in cash, at a rate
per annum equal to 10.75%. The Senior Notes will be the
unsecured senior obligations of the company, and will be
guaranteed on an unsecured senior basis by each of the company's
existing and future United States subsidiaries as defined under
the terms of the Notes. The Senior Subordinated Notes will be
the senior subordinated unsecured obligations of the company,
and will be guaranteed on a senior subordinated unsecured basis
by each of the Subsidiaries.
General Nutrition Centers, Inc. -- http://www.gnc.com/-- with
headquarters in Pittsburgh, Pennsylvania, retails and
manufactures vitamins, minerals, and nutritional supplements
domestically and internationally through about 5850 company-
operated and franchised stores. Revenue for the twelve months
ended September 2006 approached US$1.5 billion. General
Nutrition's Latin American operations are in the Bahamas, Cayman
Islands, Chile, Colombia, Costa Rica, among others.
* * *
As reported in the Troubled Company Reporter-Latin America on
March 2, 2007, Moody's Investors Service assigned these ratings:
-- US$710 million senior secured credit facility at B1
(LGD 2, 27%);
-- US$300 million floating-rate seven-year senior notes
at Caa1 (LGD 5, 77%);
-- US$125 million fixed-rate eight-year senior subordinated
notes at Caa2 (LGD 6, 95%);
-- Corporate family rating at B3;
-- Probability-of-default rating at B3;
-- Speculative Grade Liquidity rating at SGL-3.
HARRAH'S ENTERTAINMENT: Earns US$47MM in Quarter Ended Dec. 31
--------------------------------------------------------------
Harrah's Entertainment Inc. reported net income of US$47.6
million on revenues of US$2.43 billion for the fourth quarter
ended Dec. 31, 2006, compared with a net loss of US$142.2
million on revenues of US$2.095 billion for the same period in
2005.
Fourth-quarter income from operations was US$229.7 million, an
increase of 47.4 percent from income from operations of
US$155.8 million in the year-ago quarter. Income from
continuing operations was US$39.4 million, compared with a loss
of US$24.5 million posted in the 2005 fourth quarter. The 2006
and 2005 fourth-quarter results were impacted by US$20.7 million
and US$138.6 million, respectively, in charges to recognize the
impairment of certain intangible assets.
Fourth-quarter same-store sales at properties that Harrah's has
operated for more than 12 months rose 6.8 percent from the year-
ago quarter. The comparison excludes properties closed in the
prior year period due to hurricane damage sustained in the third
quarter of 2005.
Harrah's Entertainment Inc. reported net income of US$535.8
million on net revenues of US$9.673 billion for the year ended
Dec. 31, 2006, compared with net income of US$236.4 million on
net revenues of US$7.01 billion in 2005.
Full-year 2006 income from operations was US$1.556 billion, up
51.3 percent from US$1.029 billion in 2005. Income from
continuing operations in 2006 was US$523.9 million, compared
with US$316.3 million in 2005.
The effective tax rate for the full-year 2006 was 36.1 percent,
compared with 41.7 percent in 2005. The 2006 effective tax
rates reflect the impact of certain income-tax benefits
identified as the company completed its 2005 tax returns and the
adjustment to tax reserves due to issues in tax periods that
have now been settled. Excluding the impact of these benefits
from the tax-rate calculation, the effective tax rates for 2006
would have been 38.6 percent.
Fourth-Quarter Highlights
Harrah's entered into a definitive agreement with affiliates of
Texas Pacific Group and Apollo Management L.P. to acquire the
company in an all-cash transaction. Under the terms of the
agreement, Harrah's stockholders will receive $90 in cash for
each outstanding Harrah's share. On Feb. 8, 2007, Harrah's
filed a preliminary proxy statement with the Securities and
Exchange Commission that provides details regarding the pending
sale of the company.
In December 2006, Harrah's completed the acquisition of London
Clubs, which operates seven casinos in the United Kingdom, two
in Egypt and one in South Africa, and has four others under
development in the UK.
On Oct. 2, 2006, Harrah's announced a definitive agreement to
acquire the Barbary Coast, giving the company control of three
of the four corners of Las Vegas Boulevard and Flamingo Road.
Coupled with previously completed land-purchase agreements, the
Barbary Coast transaction will give Harrah's control of about
350 acres at or near the center of the Las Vegas Strip.
"During the 2006 fourth quarter, continued robust visitation in
the Las Vegas Region, due in large part to completion of the
integration of our Total Rewards customer-loyalty program into
the Caesars legacy properties, drove revenues to a record
level," said Gary Loveman, Harrah's Entertainment chairman,
president and chief executive officer. "Development costs and
narrower margins in Atlantic City than in the 2005 fourth
quarter impacted overall Property EBITDA and, combined with
higher interest expenses, affected per-share results."
At Dec. 31, 2006, the company's balance sheet showed
US$22.284 billion in total assets, US$16.161 billion in total
liabilities, US$52.4 million in minority interests, and
US$6.071 billion in total stockholders' equity.
Full-text copies of the company's consolidated financial
statements for the year ended Dec. 31, 2006, are available for
free at http://researcharchives.com/t/s?1b14
The company had cash and cash equivalents of US$799.6 million at
Dec. 31, 2006, compared to US$724.4 million at Dec. 31, 2005.
About Harrah's Entertainment
Headquartered in Las Vegas, Nevada, Harrah's Entertainment, Inc.
(NYSE: HET) -- http://www.harrahs.com/-- is a gaming
corporation that owns and operates casinos, hotels, and five
golf courses under several brands on four continents. The
company's properties operate primarily under the Harrah's,
Caesars and Horseshoe brand names; Harrah's also owns the London
Clubs International family of casinos. Last January, it signed a
joint venture agreement with Baha Mar Resorts Ltd. to operate a
resort in Bahamas.
* * *
As reported in the Troubled Company Reporter-Latin America on
Feb. 16, 2007, Fitch Ratings may downgrade Harrah's
Entertainment Inc.'s aka HET Issuer Default Rating into the 'B'
category from its current 'BB+' rating based on the planned
capital structure for its leveraged buyout or LBO by Apollo
Management and Texas Pacific Group, which was outlined in its
preliminary proxy statement (filed Feb. 8, 2006).
As reported in the Troubled Company Reporter on Dec. 26, 2006,
Standard & Poor's Ratings Services lowered its ratings on
Harrah's Entertainment Inc. and its subsidiary Harrah's
Operating Co. Inc., including its corporate credit rating to
'BB' from 'BB+.
REGIONAL SALES: Will Hold Last Shareholders Meeting on April 9
--------------------------------------------------------------
Regional Sales Services Ltd. will hold its final shareholders
meeting on April 9, 2007, at 10:00 a.m. at the company's
registered office.
These agendas will be taken during the meeting:
1) accounting of the liquidation process showing how the
winding up has been conducted and how the property will
be disposed of on April 9, 2007, the date of the final
wind up.
2) authorize the Liquidators to retain the records of the
company for a period of five years from the dissolution
of the company, after which they may be destroyed.
A member entitled to attend and vote at the meeting will be
allowed to appoint a proxy, who need not be a member, in his
stead.
The liquidator can be reached at:
Alpha Direction Ltd.
Oceanic Bank and Trust Limited
TK House, Bayside Executive Park
West Bay St. And Blake Road
P.O. Box AP 59213
Nassau, Bahamas
WINN-DIXIE STORES: Wants Final Decree Entered on 23 Cases
---------------------------------------------------------
Winn-Dixie Stores, Inc., and its debtor-affiliates ask the U.S.
Bankruptcy Court for the Southern District of New York to enter
a final decree closing all of the 23 subsidiary Chapter 11 cases
-- Case Nos. 05-03818 through 05-03840 -- no later than
March 31, 2007.
The Debtors also ask the Court to continue the jointly
administered Chapter 11 case of Winn-Dixie, et al. -- Case No.
05-03817 -- pending further Court order upon completion of
proceedings in that case.
The Subsidiary Debtors are:
Astor Products, Inc. Crackin' Good, Inc.
Deep South Distributors, Inc. Deep South Products, Inc.
Dixie Darling Bakers, Inc. Dixie-Home Stores, Inc.
Dixie Packers, Inc. Dixie Spirits, Inc.
Economy Wholesale Distributors, Inc. Dixie Stores, Inc.
Kwik Chek Supermarkets, Inc. Foodway Stores, Inc.
Sunbelt Products, Inc. Winn-Dixie Montgomery,
Inc.
Table Supply Food Stores Co., Inc. Superior Food Co.
WD Brand Prestige Steaks, Inc. Winn-Dixie Handyman, Inc.
Winn-Dixie Logistics, Inc. Sundown Sales, Inc.
Winn-Dixie Procurement, Inc. Winn-Dixie Raleigh, Inc.
Winn-Dixie Supermarkets, Inc.
Cynthia C. Jackson, Esq., at Smith Hulsey & Busey, in
Jacksonville, Florida, tells Judge Funk that the remaining
proceedings in the Reorganized Debtors' Chapter 11 cases
essentially consist of matters relating to claims allowance,
distributions with respect to allowed claims, and other aspects
of implementation of their confirmed Plan of Reorganization.
Ms. Jackson states that none of the remaining bankruptcy matters
involves issues that would require separate proceedings by any
particular Debtor in the separate case of a particular Debtor.
Ms. Jackson states that the claims objection process for the
Subsidiary Debtors in the jointly administered case has been,
and will continue to be, administered by the Winn-Dixie
management. She relates that no claims objection proceedings
have been brought, and none will be needed, in any separate case
of any of the Subsidiary Debtors.
In addition, the Winn-Dixie management will continue to be
responsible for distributions and other implementation matters
under the Plan, which does not require involvement of any of the
Subsidiary Debtors in that process, Ms. Jackson says.
Ms. Jackson avers that other than certain cash distributions
required by the Plan, which are made by Winn-Dixie from
consolidated cash accounts, the claims of creditors are being
treated primarily with Winn-Dixie stock, and not with any
consideration issued by any of the Subsidiary Debtors.
Moreover, Ms. Jackson discloses that following the Plan
Effective Date, 16 of the 23 subsidiary cases have either been
dissolved, merged out of existence, or otherwise terminated in
accordance with applicable state law.
Therefore, Ms. Jackson asserts, there is no more reason to
maintain the separate cases of the Subsidiary Debtors. If
circumstances change for those cases, Section 350(b) permits the
Court to reopen any of the closed cases at any time, she states.
Ms. Jackson further insists that maintenance of the Subsidiary
Cases will impose continuing financial burdens on the Debtors
for fees under 28 U.S.C. Section 1930.
Ms. Jackson avers that closing the subsidiary cases by March 31
will allow the Reorganized Debtors to reduce a substantial
expense, thus benefiting the creditors who now hold the equity
ownership of the Debtors.
Headquartered in Jacksonville, Florida, Winn-Dixie Stores Inc.
(Nasdaq: WINN) -- http://www.winn-dixie.com/-- is one of the
nation's largest food retailers. The Company operates 527
stores in Florida, Alabama, Louisiana, Georgia, and Mississippi.
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. The Honorable
Jerry A. Funk confirmed Winn-Dixie's Joint Plan of
Reorganization on Nov. 9, 2006. Winn-Dixie emerged from
bankruptcy on Nov. 21, 2006. (Winn-Dixie Bankruptcy News, Issue
No. 66; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
=============
B E R M U D A
=============
REFCO: Administrators Want Claims Bar Date Extended to Apr. 30
--------------------------------------------------------------
RJM, LLC, the duly appointed administrator of Refco Inc.'s case,
and Marc S. Kirschner, the duly appointed administrator and
Chapter 11 Trustee of Refco Capital Markets, Ltd.'s estate, ask
the Honorable Robert D. Drain of the U.S. Bankruptcy Court for
the Southern District of New York to extend the Administrative
Claims Objection Deadline through and including April 30, 2007.
Upon the Effective Date of the Chapter 11 Plan filed by Refco,
Inc., and its debtor-subsidiaries, the plan administrators
assumed the rights, powers, and duties of the Reorganized
Debtors and RCM on the estates' behalf.
Under the Plan Confirmation Order, the Court set Jan. 25, 2007
-- 30 days after the Effective Date -- as the deadline to file
an administrative expense priority claim.
Steven Wilamowsky, Esq., at Bingham McCutchen LLP, in New York,
relates that before the expiration of the Administrative Claims
Bar Date, over 200 administrative claims have been filed against
the Refco estates.
On Feb. 9, 2007, the Plan Administrators, on behalf of Refco F/X
Associates, LLC, objected to approximately 150 administrative
expense claims filed against FXA.
Over the course of the Debtors' Chapter 11 cases, a number of
administrative expense claims have been resolved by Court order
or by consent of the parties, Mr. Wilamowsky notes.
The Plan Administrators continue to reconcile the remaining
Administrative Claims filed against the Chapter 11 estates.
According to Mr. Wilamowsky, the Plan defines "Administrative
Claims Objection Deadline" as the last day for filing an
objection to any request for the payment of an Allowed
Administrative Claim, which will be:
(a) the later of 60 days after the Effective Date, or 30 days
after filing an Administrative Claim; or
(b) other date specified in the Plan or ordered by the
Court.
Mr. Wilamowsky points out that since the Effective Date occurred
on Dec. 26, 2006, the Administrative Claims Objection
Deadline is presently Feb. 26, 2007, and not Jan. 25, 2007.
The Plan Administrators state that by virtue of filing their
request, the Administrative Claims Objection Deadline is
automatically extended until entry of an order approving or
denying the extension.
The Plan Administrators assert that an extension of the
Administrative Claims Objection Deadline is appropriate to
complete the administrative claims reconciliation process and to
help ensure that all non-meritorious administrative claims are
appropriately challenged.
Furthermore, the Plan Administrators believe that the extension
is particularly important to ensure that no unwarranted
administrative expense claims are allowed simply by virtue of
the passage of time; allowed administrative expense claims are
required to be paid in full under the Plan, and, thus have a
greater relative impact upon recoveries to prepetition unsecured
creditors, who are expected to receive only a fraction of the
allowed amounts of their claims.
While the need to seek additional extensions is not anticipated,
the Plan Administrators reserve the right to seek further
extensions of the Administrative Claims Objection Deadline.
About Refco Inc.
Headquartered 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.
The Court confirmed the Modified Joint Chapter 11 Plan of
Refco Inc. and certain of its Direct and Indirect Subsidiaries,
including Refco Capital Markets, Ltd., and Refco F/X Associates,
LLC, on Dec. 15, 2006. That Plan became effective on
Dec. 26, 2007. (Refco Bankruptcy News, Issue No. 58; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/
or 215/945-7000).
REFCO INC: Crisis Managers Want US$7.4 Mil. in Success Fees Paid
----------------------------------------------------------------
AP Services, LLC, and Goldin Associates, LLC, ask the U.S.
Bankruptcy Court for the Southern District of New York to compel
Refco, Inc., and its debtor-subsidiaries to pay them contingent
success fees totaling US$7,430,433 for services rendered as
crisis managers in the Debtors' Chapter 11 cases.
Specifically, APS seeks approval of a US$5,000,000 Success Fee
consistent with the terms of its Court-approved engagement
letter with the Debtors, dated Oct. 18, 2005.
Goldin seeks payment of a US$2,430,433 Success Fee in connection
with its engagement as crisis manager for Refco, including
services performed by Harrison J. Goldin, as chief executive
officer; David Pauker and Mark Slane, as chief restructuring
officers; and Jerry Lombardo, as chief financial officer.
The Goldin Success Fee represents a 25% premium to the hourly
fees paid to Goldin in connection with its Engagement Letter
with the Debtors, dated Jan. 5, 2006.
APS and Goldin believe that the exceptional results they
achieved in Refco's successful cases in a narrow time frame, as
well as their relevant contributions, fully merit the award of
the requested Success Fees.
APS US$5,000,000 Success Fee
Sheldon S. Toll, Esq., at Sheldon S. Toll PLLC, in Southfield,
Michigan, tells Judge Drain that amid the chaos from the
Debtors' bankruptcy filing through the effective date of the
Reorganized Debtors' Chapter 11 Plan, APS has expended
incredible crisis management efforts around the world to ensure
a timely and orderly wrap-up of the Debtors' affairs, while
seeking to maximize the cash available to their creditors.
According to Mr. Toll, the APS team, working with the other
retained firms in the Debtors' cases, led certain key aspects
and contributed significantly to the overall success and prompt
wind-down of the Refco business by:
(1) managing the lengthy and complex post-closing processes
of the Man Financial Inc. transaction, which included
Refco's largest U.S. operation and related international
entities in the United Kingdom, Canada, and Asia;
(2) working with management and parties-in-interest to wind
down Refco Securities, LLC, out of court, hence, saving
substantial direct costs and accelerating the speed of
the case;
(3) analyzing customer accounts with and assets and
liabilities of Refco Capital Markets, Ltd., which effort
provided valuable insights to the Debtors and creditors
during the customer litigation and RCM customer
settlement process, and enabled prompt initial
distributions to creditors after the Plan Effective Date;
(4) leading intercompany analysis, providing creditors and
debtors with valuable insights into the company's
intercompany accounts and historical transactions, and
providing information necessary for the parties to
conduct Plan negotiations;
(5) separating information technology function from Man
Financial subsequent to the acquisition, and leading the
development of an independent estate IT function; and
(6) leading the claims analysis and resolution efforts for
the Debtors, which led to the resolution to a substantial
number of claims before the Effective Date and enabled
distribution of over US$1,400,000,000 in cash to RCM
creditors in December 2006 -- within two days after the
Effective Date.
Other estate management issues addressed by the APS team include
liquidity and cash management; wind-down of fund management
business; wind-down of Refco F/X Associates, LLC; human
resources and facilities management; and general case
management.
Mr. Toll asserts that APS has played a key role in worldwide
asset sales and orderly liquidations that will result in over
US$1,000,000,000 in cash to the Debtors' estates.
Mr. Toll also points out that the APS role has been key not only
to the negotiation of various asset purchase agreements and
planning of orderly wind downs, but also key in leading
implementation of those initiatives, as well as in the absence
of any management structure. In addition, APS has enabled the
estate to preserve value through management of complex
postpetition negotiations, with estimated proceeds totaling up
to US$1,283,200,000, he states.
Mr. Toll notes that during the Debtors' case, neither APS nor
other retained firms were paid on a current basis. Thus, he
says, APS and the other firms were effectively uncompensated DIP
lenders to the estate. He adds that the estates benefited
because they would have had to borrow at rates in excess of 11%
if they could have borrowed at all. APS' average monthly unpaid
balance from the Debtors' bankruptcy filing through the
Effective Date was over US$7,000,000, he discloses.
Mr. Toll acknowledges other retained firms and individuals who
played important roles in the Reorganized Debtors' cases. He
maintains, however, that the successful results would not have
occurred without the APS team efforts.
Mr. Toll insists that the APS Success Fee is appropriate because
it was included in the US$180,000,000 fee cap computation, and,
thus should be approved.
Goldin's US$2,430,433 Success Fee
Steven J. Reisman, Esq., at Curtis, Mallet-Prevost, Colt & Mosle
LLP, in New York, states that Goldin played a significant role
in organizing a consensual Chapter 11 Plan in the Debtors' cases
by providing interim management and restructuring services to
the Debtors. Goldin also:
(a) orchestrated and led a strategy based on full cooperation
with all governmental investigations in connection with
the alleged fraud present in the Debtors' cases;
(b) led negotiations that successfully resolved all issues
concerning RSL distribution;
(c) worked for the Reorganized Debtors' overseas operations
to ensure distributions of foreign subsidiaries and
affiliates;
(d) sought to maximize the number of qualified estate
personnel regarding the Debtors' human resource
activities and functions; and
(e) was responsible for overseeing the accounting, financial
reporting and related activities.
Mr. Reisman notes that Goldin continued to be involved in
maximizing future distributions to customers and facilitating
orderly resolution of the issues facing RCM, even after the RCM
estate came under the separate management of a Court-appointed
trustee.
Mr. Reisman says Goldin was also involved in formulating and
executing numerous strategies to maximize recoveries to Refco
from Refco, LLC, by providing extensive resources of the parent
company and its professionals to support the activities of
Albert Togut, as Chapter 7 Trustee for the Refco LLC estate.
Moreover, Mr. Reisman states, Goldin played a key role in
representing the interests of the FXA creditors during the Plan
negotiations, and actively negotiated to obtain numerous
improvements, including increased cash, reduced expenses and
interests in a litigation trust.
Mr. Reisman further discloses that Goldin minimized the costs to
the estates of outside management consultants throughout the
bankruptcy proceedings by reducing the combined Goldin/AP
Services, LLC, interim management staff from 23 in January 2006,
to 12 by December 2006.
Through the final quarter of 2006, Goldin was paid US$9,721,734
in fees and reimbursed US$106,107 in expenses for services
rendered during the Debtors' cases, Mr. Reisman states.
"Given the extraordinary circumstances presented when Goldin was
retained to take over management, a success fee is a normal and
expected component of compensation," Mr. Reisman asserts.
The Court will convene a hearing on April 11, 2007, at 10.00
a.m. to consider approval of the APS and Goldin Success Fees.
About Refco Inc.
Headquartered 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.
The Court confirmed the Modified Joint Chapter 11 Plan of
Refco Inc. and certain of its Direct and Indirect Subsidiaries,
including Refco Capital Markets, Ltd., and Refco F/X Associates,
LLC, on Dec. 15, 2006. That Plan became effective on
Dec. 26, 2007. (Refco Bankruptcy News, Issue No. 58; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/
or 215/945-7000)
TK ALUMINUM: Noteholders Agree to Amend Senior Note Indenture
-------------------------------------------------------------
Teksid Aluminum Luxembourg S.a.r.l., S.C.A., a subsidiary of TK
Aluminum Ltd., disclosed that as of 12:00 p.m., New York City
time (5:00 p.m., London time), on Wednesday, March 7, it had
validly delivered consents representing approximately 62% of the
EUR240,000,000 aggregate principal amount of its outstanding
11.375% Senior Notes due 2011, pursuant to its previously
announced solicitation of consents to implement proposed
amendments to the indenture governing the Senior Notes.
Consequently, the company has the requisite consents from
holders of Senior Notes required by the Indenture to execute a
supplemental indenture giving effect to the proposed amendments
to the Indenture.
The consent solicitation expires on March 8, at 10:00 a.m., New
York City time (3:00 p.m., London time). The company may,
subject to certain restrictions, amend, extend, or terminate the
consent solicitation at any time in its sole discretion.
The proposed indenture amendments:
(i) permit the previously announced sale of certain assets
and operations to Tenedora Nemak, S.A. de C.V., a
subsidiary of Alfa, S.A.B. de C.V. on such amended terms
as the company may negotiate, as long as certain
conditions outlined in proposed amendments are satisfied;
and
(ii) implement the other terms that were agreed to with the
financial and legal advisors to the adhoc committee of
Noteholders, which were previously announced in the
company's Feb. 27 press release. The proposed indenture
amendments and terms of the consent solicitation are
described in the Consent Solicitation Statement dated
March 2.
The company has executed a term sheet with Nemak indicating
revised terms for the Nemak Sale, taking into account the most
current circumstances. The company continues to work with Nemak
to finalize definitive documentation consistent with these terms
and consummate the Nemak Sale. The term sheet with Nemak places
Nemak under no obligation to consummate the Nemak Sale until a
definitive agreement to amend the transaction has been executed.
Failure to close the Nemak Sale could materially and adversely
affect the company's ability to continue trading. Closing of
the amended Nemak Sale is subject to various conditions,
including the execution of the Supplemental Indenture and other
customary conditions, including regulatory approvals.
The completion of the consent solicitation is subject to, among
other things, the due execution of the Supplemental Indenture
and certain other general conditions described in the Statement.
These conditions are for the company's sole benefit and the
company may waive them in whole or in part at any time or at
various times prior to the expiration of the consent
solicitation in its sole discretion.
About Teksid Aluminum
Teksid Aluminum -- http://www.teksidaluminum.com/--
manufactures aluminum engine castings for the automotive
industry. Principal products include cylinder heads, engine
blocks, transmission housings, and suspension components. The
company operates 15 manufacturing facilities in Europe, North
America, South America, and Asia. The company maintains
operations in Italy, Brazil, and China.
Until Sept. 2002, Teksid Aluminum was a division of Teksid
S.p.A., which was owned by Fiat. Through a series of
transactions completed between Sept. 30, 2002 and Nov. 22, 2002,
Teksid S.p.A. sold its aluminum foundry business to a consortium
of investment funds led by equity investors that include
affiliates of each of Questor Management Company, LLC, JPMorgan
Partners, Private Equity Partners SGR SpA and AIG Global
Investment Corp. As a result of the sale, Teksid Aluminum is
now owned by its equity investors through TK Aluminum Ltd., a
Bermuda holding company.
* * *
On Jan. 16, Moody's Investors Service placed TK Aluminum
Ltd.'s long-term corporate family rating at Caa3.
=============
B O L I V I A
=============
* BOLIVIA: La Paz Crude Production Can't Meet Demand
----------------------------------------------------
Bolivian fuel-blending association Asosur president Pierre Chan
told government news agency Agencia Boliviana de Informacion
that the La Paz department is faced with a shortage of fuel
supply.
While gasoline demand has increased, there was no boost in the
supply from refineries, Agencia Boliviana notes, citing Mr.
Chan.
Business News Americas relates that as demand reached 850,000
liters per day, about 600,000l were supplied.
Mr. Chan commented to BNamericas, "This weekend gasoline was not
dispatched in accordance with demand...blenders have finished
their reserves and are no longer dispatching from the Senkata
blender. Authorities should begin a background investigation to
find out who is responsible for programming issues."
Agencia Boliviana underscores that Bolivian state hydrocarbons
firm Yacimientos Petroliferos Fiscales Bolivianos guaranteed the
supply of gasoline and liquefied petroleum gas in La Paz and El
Alto, after overcoming pipeline cutoffs and poor road conditions
from Santa Cruz to Cochabamba.
According to BNamericas, Yacimientos Petroliferos operations
vice president Sebastian Daroca planned to assign 1.5 million
liters of gasoline for the two cities on March 5, nearly
doubling the standard supply for the day.
Mr. Daroca told BNamericas that the average sale of gasoline is
770,000 to 800,000 liters per day, while March 9 registered over
1.07 million liters, with lower sales on March 10. With respect
to the liquefied petroleum gas shortage, Yacimientos
Petroliferos and hydrocarbons regulator Superintendencia de
Hidrocarburos are sending trucks to zones in need of supply.
Yacimientos Petroliferos planned to distribute over 42,000
liquefied petroleum gas cylinders to La Paz, which demands up to
40,000 per day.
Agencia Boliviana emphasizes that Bolivia has the second largest
hydrocarbons reserves in Latin America. However, it has the
lowest rate of liquefied petroleum gas and natural gas
consumption.
BNamericas notes that of a total 760,000 rural homes, some 13%
have natural gas or liquefied petroleum gas coverage for cooking
use, while 75% use firewood.
Bernhard Zymla, the German technical cooperation agency GTZ's
advisor to access to energy services program, commented to
BNamericas, "There has been a lack of consciousness, not only in
governments and international cooperation, because large
financiers like the Inter-American Development Bank (IDB), the
Andean Development Corporation (CAF) and NGOs all have gone for
electricity."
Bolivian President Evo Morales promised a US$5-million
investment to install domestic gas for El Alto residents. The
project would be funded with state resources, local paper
RedBolivia states.
* * *
Fitch Ratings assigned these ratings on Bolivia:
Rating Rating Date
Country Ceiling B- Jun. 17, 2004
Long Term IDR B- Dec. 14, 2005
Local Currency
Long Term Issuer
Default Rating B- Dec. 14, 2005
* BOLIVIA: Hydrocarbon Nationalization Won't Scare Off Investors
----------------------------------------------------------------
Bolivia's President Evo Morales has assured Japan that the
nationalization of Bolivian natural gas and oil reserves won't
discourage foreign investors, Dow Jones Newswires reports.
President Morales nationalized Bolivia's hydrocarbon reserves in
May 2006. He sent troops to confiscate foreign-run wells and
plants, causing fears and resistance among international firms
that operate in Bolivia, Dow Jones relates.
Dow Jones underscores that Japanese leaders had urged President
Morales during the latter's visit to Japan to maintain the
stability of the Bolivian legal and tax systems and to avoid
sudden changes that would drive away foreign investment.
According to Dow Jones, President Morales promised that foreign
investors' interests in Bolivia will be protected.
President Morales told the press, "We [the Bolivian government]
have carried forward our reforms without expelling foreign
companies or seizing their assets and we will continue to do so.
We ensure increases in investment returns and profits for the
investment companies."
Meanwhile, President Morales also supported Venezuelan President
Hugo Chavez's proposal to form a South American organization of
natural gas producers similar to Organization of the Petroleum
Exporting Countries, Dow Jones notes.
President Morales told Dow Jones, "It is necessary for natural
gas producers to cooperate and form an alliance through such an
organization."
President Morales denied to Dow Jones that the organization
would politically influence non-exporting nations.
* * *
Fitch Ratings assigned these ratings on Bolivia:
Rating Rating Date
Country Ceiling B- Jun. 17, 2004
Long Term IDR B- Dec. 14, 2005
Local Currency
Long Term Issuer
Default Rating B- Dec. 14, 2005
* BOLIVIA: Lower House To Vote on Bill to Correct Oil Deals
-----------------------------------------------------------
The Bolivian government news agency Agencia Boliviana de
Informacion reports that the lower house will vote on the
approval of a bill that would correct errors in 15 of the 44
contracts negotiated with oil companies as part of President Evo
Morales' nationalization program.
A spokesperson from the hydrocarbons ministry told Business News
Americas that Bolivian state-run oil firm Yacimientos
Petroliferos Fiscales Bolivianos had reported that 10 contracts
had minimal errors that required revision. However, there were
actually 15 contracts that have mistakes and need an "exhaustive
revision."
According to BNamericas, the bill is expected to pass easily
through the lower house, where President Evo Morales' party
Movimiento al Socialismo has a majority. However, the group
could face more opposition in the upper house.
The spokesperson said that once the 15 contracts are ratified by
the upper house, all 44 accords will have to pass through both
houses again before being implemented, BNamericas notes.
Hydrocarbons Carlos Villegas aims for the contracts to be
implemented by March 15, BNamericas states.
* * *
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
===========
BAUSCH & LOMB: U.S. Operations Likely to be Unprofitable
--------------------------------------------------------
Bausch & Lomb Inc. reported certain preliminary and unaudited
financial results for the full year and fourth quarter ended
Dec. 30, 2006. Due to the considerable time and effort that it
had to devote to completing the recently completed financial
restatement and filing of its 2005 10-K, the company has not
been able to timely complete its financial close process for
2006. As a result, there can be no assurance that the amounts
reported will not differ, including materially, from those
reported when the company files its 2006 10-K. Bausch & Lomb
currently expects to file its 2006 10-K by April 30, 2007.
Net Sales and Income
Because the company has not yet completed its year-end financial
close process, including the calculation and review of income
taxes, Bausch & Lomb is unable to estimate net earnings or
earnings per share at this time. However, as a result of lower
lens care sales and costs associated with the MoistureLoc
recall, the company expects its U.S. operations to be
unprofitable.
The company expects to report income before income taxes and
minority interest of approximately US$70 million in 2006,
compared to US$246.4 million in 2005. For the fourth quarter of
2006, the company expects to report income before income taxes
and minority interest of approximately US$25 million, compared
to US$84.3 million a year ago.
Bausch & Lomb expects to report consolidated full-year net sales
of approximately US$2.293 billion in 2006, down 3% compared to
US$2.354 billion in 2005, mainly due to lower sales of vision
care products.
Sales comparisons are also impacted by acquisition and
divestiture activities. In the third quarter of 2005, the
Company divested Woehlk, a German contact lens business, and in
the fourth quarter of 2005 it acquired CT Freda, a Chinese
ophthalmic pharmaceuticals company.
Bausch & Lomb expects to report consolidated net sales of
approximately US$598.5 million for the fourth quarter of 2006,
compared to US$626.4 million in the same period in 2005. That
represents a decline of 5%, or 7% on a constant-currency basis,
and mainly reflects lower sales of vision care products.
Because the company has not yet completed its year-end financial
close process, including the calculation and review of income
taxes, Bausch & Lomb is unable to estimate net earnings or
earnings per share at this time. However, as a result of lower
lens care sales and costs associated with the MoistureLoc
recall, the company expects its U.S. operations to be
unprofitable.
The company expects to report income before income taxes and
minority interest of approximately US$70 million in 2006,
compared to US$246.4 million in 2005. For the fourth quarter of
2006, the company expects to report income before income taxes
and minority interest of approximately US$25 million, compared
to US$84.3 million a year ago.
Bausch & Lomb also expects to report these liquidity metrics:
* cash and investments of approximately US$500 million as of
Dec. 30, 2006, compared to US$720.6 million at the end of
2005;
* total debt of approximately US$835 million at the end of
2006, compared to US$992.5 million at the end of 2005; and
* full-year cash flows from operating activities of
approximately US$125 million in 2006, and capital spending
of approximately US$105 million.
"In 2006, we were confronted with two challenges that
significantly impacted our financial performance and hindered
our positive momentum," Bausch & Lomb Chairman and Chief
Executive Officer Ronald L. Zarrella said. "Having confronted
both those challenges, we're now focused on rebuilding that
momentum with specific emphasis on the areas of our business
most affected by the MoistureLoc recall, so that 2007 can serve
as a springboard for renewed growth."
Expectations for 2007
Bausch & Lomb projects 2007 sales of approximately US$2.5
billion based on current exchange rates, or approximately 8%
growth compared to 2006 sales prior to MoistureLoc charges.
These overall growth projections take into consideration
expected market trends, the anticipated benefit from several new
products, and assume the company is successful in regaining
modest market share in the lens care category.
Bausch & Lomb expects sales of contact lenses to grow 8% to 10%
in 2007.
The company currently projects income before income taxes and
minority interest of approximately US$220 million in 2007.
Those expectations are based on these assumptions:
* gross margin percentages approaching pre-2006 levels, due to
improved sales mix from the launch of higher-margin new
products and anticipated growth in lens care;
* selling, administrative and general expenses of slightly
more than 40% of sales, reflecting continued brand
rebuilding efforts and new product launch support, stock-
based compensation expense, and legal expenses associated
with product liability and shareholder lawsuits;
* research and development expense of approximately 8% of
sales; and
* net financing expenses of approximately US$45 million.
The company's income projections do not include a benefit from
the anticipated reversal of interest and penalties associated
with a previously recorded Brazilian tax assessment. As
previously disclosed, Bausch & Lomb has applied for, and expects
to be granted, amnesty from the state government of Sao Paulo as
to a portion of the penalties and interest associated with one
such assessment that was recorded as part of the financial
restatement. The company expects to reverse approximately US$20
million of penalties and interest when it receives formal
notification by the state government of Sao Paulo.
From a liquidity perspective, Bausch & Lomb expects to generate
cash flow from operations of between US$240 million and US$260
million and to incur approximately US$100 million of capital
expenditures.
About Bausch & Lomb
Headquartered in Rochester, New York, Bausch & Lomb Inc. --
http://www.bausch.com/-- develops, manufactures, and markets
eye health products, including contact lenses, contact lens care
solutions, and ophthalmic surgical and pharmaceutical products.
The company is organized into three geographic segments: the
Americas; Europe, Middle East, and Africa; and Asia (including
operations in India, Australia, China, Hong Kong, Japan, Korea,
Malaysia, the Philippines, Singapore, Taiwan and Thailand). In
Latin America, the company has operations in Brazil and Mexico
* * *
As reported in the Troubled Company Reporter-Europe on Feb. 6,
Moody's Investors Service downgraded Bausch & Lomb Inc.'s senior
unsecured debt to Ba1 and continues to review all ratings for
possible downgrade. Moody's also assigned the company a Ba1
Corporate Family Rating.
BLOCKBUSTER INC: Earns US$54.7 Million in Full Year 2006
--------------------------------------------------------
Blockbuster Inc. reported net income of US$54.7 million for the
year ended Dec. 31, 2006, compared with a net loss of US$588.1
million for 2005.
Excluding the favorable resolution of multi-year tax audits,
store closure and severance costs as well as certain other
items, adjusted net income for the full-year 2006 would have
been US$6.3 million, compared with an adjusted net loss of
US$73.6 million in 2005.
Revenues for 2006 decreased 3.5% to US$5.52 billion from
US$5.72 billion for 2005 mostly due to the closure of stores
resulting from accelerated actions to optimize the company's
asset portfolio and a 2.1% decrease in worldwide same-store
sales. Worldwide same-store revenues include the favorable
impact of a US$105.5 million increase in revenues from
Blockbuster's online rental service resulting from growth in the
subscriber base, which nearly doubled to approximately 2.2
million subscribers, including approximately 2 million paying
subscribers, at the end of 2006.
Operating income for the full-year 2006 totaled US$79.1 million,
as compared to an operating loss of US$388.0 million for the
same period last year, which included a US$341.9 million non-
cash charge to impair goodwill and other long-lived assets.
For the fourth quarter of 2006, net income was US$12.9 million
as compared with net income of US$18 million for the fourth
quarter of 2005.
Revenues for the fourth quarter of 2006 increased 1.4% to
US$1.51 billion compared with US$1.49 billion for the fourth
quarter of last year primarily due to an increase in worldwide
same-store merchandise sales and favorable foreign exchange
rates.
"2006 was an exciting year for Blockbuster. We delivered four
consecutive quarters of positive same-store domestic movie
rental revenues. We also significantly reduced operating costs,
sizably increased our online subscriber base and substantially
improved our profitability and cash flow," said John Antioco,
Blockbuster Chairman and CEO.
At Dec. 31, 2006, the company's balance sheet showed
US$3.137 billion in total assets, US$2.394 billion in total
liabilities, and US$742.4 million in total stockholders' equity.
Full-text copies of the company's consolidated financial
statements for the year ended Dec. 31, 2006, are available for
free at http://researcharchives.com/t/s?1af4
Cash flow provided by operating activities increased by US$399.9
million to US$329.4 million for the full-year 2006 from a
US$70.5 million deficit for 2005 driven by improvement in
profitability.
As of Dec. 31, 2006, no balance was outstanding under the
company's revolving credit facility and the company's borrowing
capacity, which excludes various letters of credit, totaled
approximately US$293 million.
Divestiture of Non-Core Assets
As part of the ongoing review of its asset portfolio, during
2006 the company completed the divestiture of its MOVIE TRADING
CO.(R) locations and Movie Brands Inc. subsidiary, closed its
store operations in Spain and sold its Taiwan subsidiary,
coupled with a master franchise license, to Webs-TV, the largest
broadband TV operator in the Chinese market.
Most recently, in 2007 the company sold its 72-store, U.S.-based
RHINO VIDEO GAMES(R) chain to GameStop Corp. and in conjunction
with the Blockbuster Brazilian franchisee's sale of its stores
to LOJAS Americanas, the company signed a 20-year licensing
agreement with Lojas, giving the Brazilian retailer rights to
the BLOCKBUSTER brand for the rental and retail sale of video
products. The company also entered into an agreement to sell
its Australian subsidiary and grant the master franchise rights
for the BLOCKBUSTER system in Australia to Video Ezy, an
Australian-based company with 518 franchised video rental
stores.
About Blockbuster
Blockbuster Inc. (NYSE: BBI) -- http://www.blockbuster.com/--
is a leading global provider of in-home movie and game
entertainment, with over 8,000 stores throughout the Americas,
Europe, Asia and Australia. The company maintains operations in
Brazil, Mexico, Denmark, Italy, Taiwan, Australia, among others.
* * *
As reported in the Troubled Company Reporter on Dec. 19, 2006,
Standard & Poor's Ratings Services revised its outlook on video
rental retailer Blockbuster Inc. to stable from negative. The
ratings on the Dallas-based company, including the 'B-'
corporate credit rating, were affirmed.
BROWN SHOE: Earns US$13.6 Million in Quarter Ended Feb. 3, 2007
---------------------------------------------------------------
Brown Shoe Company Inc. reported results for the fourth quarter
and fiscal year ended Feb. 3, 2007.
Ron Fromm, Brown Shoe's Chairman and CEO, stated, "Fiscal 2006
was a year of many accomplishments for Brown Shoe Company. Our
growth was balanced across our wholesale and retail platforms
with a record performance at Famous Footwear and significant
strides made with our Naturalizer and Dr. Scholl's brands during
the year. Our ability to satisfy consumers' desires for
compelling brands and fashion at all channels of distribution
remains a core strength. Adherence to our sell-through model
and inventory discipline also contributed to our double-digit
increase in earnings for the year. During the year, we
continued to evaluate our portfolio to ensure that we are
focused on opportunities that maximize our long-term sales and
profit growth. To this end, we made decisions to exit our Bass
license and reposition our Brown New York brands to the
consumer-driven model that has been successful in our core
brands. Lastly, we began to implement an earnings enhancement
plan that has already begun to positively impact our business,
as we benefit from increased talent, a more efficient operation,
and a reduction in costs."
Mr. Fromm continued, "As a result of our strong performance in
2006 and confidence in our 2007 outlook, our Board of Directors
authorized a 3-for-2 stock split, to be effected in the form of
a stock dividend, and an increase in the quarterly dividend.
This is the second such stock split and dividend increase in the
past 12 months."
Fourth Quarter Highlights:
-- Net sales increased 6.6 percent to US$639.3 million, as
compared to US$599.6 million in the fourth quarter of
fiscal 2006. Fiscal 2006 includes 53 weeks and compares
to a 52-week period in fiscal 2005, with the additional
week occurring in the fourth quarter of fiscal 2006. The
53rd week increased net sales by US$22.5 million and was
not material to net earnings in the fourth quarter of
2006.
-- 2006 fourth quarter net earnings were US$13.6 million
compared to net earnings of US$13.4 million in the fourth
quarter of fiscal 2005.
-- Adjusted net earnings, excluding the above items, were
US$20.6 million as compared to fourth quarter fiscal 2005
adjusted net earnings of US$20.0 million.
Fiscal Year Highlights:
-- Net sales increased 7.8 percent to US$2.47 billion
compared with US$2.29 billion in the prior fiscal year.
-- 2006 full year net earnings were US$65.7 million compared
to net earnings of US$41.0 million.
-- Adjusted net earnings were US$71.0 million, as compared to
adjusted net earnings of US$62.9 million in the prior
fiscal year (an increase of 17.3 percent, inclusive of
footnote option expense in 2005).
Strategic Initiatives Update
The company continues to review and implement certain strategic
initiatives as part of its earnings enhancement plan, with the
goal to increase earnings and reallocate resources and
investment to drive consumer preference. Key elements of the
plan include:
i) restructuring administrative and support areas;
ii) redesigning logistics and distribution platforms;
iii) reorganizing to eliminate operational redundancies;
iv) realigning strategic priorities; and
v) refining the supply chain process and enhancing inventory
utilization.
During the fourth quarter, the company made substantial progress
in implementing a number of initiatives under this program,
including:
* The announcement of the closing of its Bennett's division's
(renamed Brown New York) Needham, MA office and its Dover,
NH distribution center, which was completed in February
2007;
* The consolidation of the Company's New York City operations
to accommodate the offices of its Brown New York division
personnel, as well as its product development team and its
showrooms;
* The announcement of the closing of its Italian sales office
in the first quarter of fiscal 2007;
* The outsourcing of its Canadian wholesale business to a
third party operator; and
* The closing of all but one of its Via Spiga stores.
These actions, along with severance costs from personnel
reductions and consulting costs related to the earnings
enhancement plan, resulted in after- tax costs of US$2.7 million
in the fourth quarter of 2006 and US$3.9 million for the full
year of 2006.
While much has been accomplished, certain of the initiatives are
still in early stages of development, and the Company expects to
update cost and savings estimates as they are further developed.
Current estimates are:
* In 2007, after-tax implementation costs are estimated to be
approximately US$14 million, while the Company expects to
realize after-tax benefits of US$10 to US$12 million;
* In 2008, after-tax implementation costs are estimated to be
approximately US$5 million and annual after-tax benefits are
still estimated to be US$17 to US$20 million.
Fourth Quarter
Retail Division
Total sales at Famous Footwear, the company's 999-store family
footwear chain, increased 13.0 percent to US$320.9 million for
the 14 weeks ended Feb. 3, 2007, versus US$284.1 million for the
13-week period last year. Same-store sales for the 13 weeks
ended Jan. 27, 2007, increased 2.9 percent, as compared to the
same period in the prior year. Strong sales growth together
with a 110 basis point improvement in gross margin rate
contributed to record fourth quarter operating earnings.
Operating earnings increased by 49.2 percent to US$22.5 million
from US$15.0 million for the year-ago period. All categories of
footwear were positive for the quarter. Famous Footwear opened
28 stores in the quarter and closed eight stores, resulting in
999 stores open at year-end.
The Specialty Retail segment, which primarily includes the
Naturalizer Retail stores and the Shoes.com e-commerce business,
reported sales of US$73.9 million, an increase of 12.4 percent
versus US$65.7 million last year, driven by top-line growth at
Shoes.com and improved productivity at Naturalizer Retail. The
segment's operating loss decreased to US$0.4 million, inclusive
of US$0.9 million in pre-tax costs to close the Via Spiga
stores, as compared to a loss of US$6.7 million in the year-ago
period, which included pre-tax costs of US$6.5 million to close
underperforming Naturalizer stores and consolidate the Company's
Canadian operations. Comparable-store sales for the 290 U.S.
and Canadian stores on a comparable 13-week basis increased 4.0
percent. The division opened one new store and closed nine
stores during the quarter.
Wholesale Division
Wholesale sales declined 2.1 percent to US$244.5 million, versus
US$249.8 million last year, as higher sales of the Company's
Naturalizer, Dr. Scholl's, LifeStride, and Children's offerings
were offset by lower sales at the company's Brown New York
brands, as the company transitioned these brands to its
consumer-driven model, deemphasized non-branded product
distribution, and completed the exit from the Bass license.
Wholesale operating earnings of US$17.8 million included US$4.7
million in pre-tax costs associated with exiting the Bass
license and implementation of initiatives associated with the
Company's earnings enhancement plan. This compares to operating
earnings of US$27.1 million in the fourth quarter last year.
Redfield Environmental Remediation
During the fourth quarter of fiscal 2006, the company submitted
a long-term plan to the State of Colorado to continue its onsite
remediation activities at its Denver, Colorado property and
developed a revised plan for the offsite remediation activities.
The additional discounted cost of the program and updated
estimates for other remediation in the areas adjacent and near
to this property resulted in an after-tax charge of US$3.4
million. In the second quarter of fiscal 2006, the company
recognized income from insurance recoveries of US$4.4 million,
after-tax, related to this site and is continuing to pursue
additional recoveries from other insurance companies and the
Colorado Department of Transportation.
Balance Sheet Highlights
Inventory at Feb. 3, 2007 was US$421 million, as compared to
US$414 million at Jan. 28, 2006. Inventory growth at Famous
Footwear and growth in Shoes.com were partially offset by
reductions in the Company's Wholesale and Specialty Retail
segments. The company's debt-to-capital ratio at the end of the
quarter was 22.4 percent, compared to 31.5 percent at the same
time last year.
Fiscal and First Quarter 2007 Guidance
The company is introducing net sales and net earnings guidance
for fiscal and first quarter 2007.
For the full fiscal year, the company is introducing net sales
guidance in the range of US$2.48 billion to US$2.52 billion.
This reflects expectations for same-store sales to increase in
the range of 2.5 percent to 3.5 percent and an addition of
approximately 110 new store openings and 45 closings at Famous
Footwear. The company also anticipates that its combined
wholesale sales will be below 2006 full-year results, with
growth of its branded business offset by the exit of the Bass
license and a sales decline in its private label business.
Diluted net earnings per share for the fiscal 2007 year are
expected to be in the range of US$2.28 to US$2.33, which
compares to diluted earnings per share of US$2.26 in fiscal
2006. On an adjusted earnings basis, after excluding earnings
enhancement plan costs in 2007 and 2006, as well as Bass exit
costs and net Redfield recoveries in 2006, the company expects
diluted earnings per share to be in the range of US$2.75 to
US$2.80, an increase of 13 percent to 15 percent, compared to
US$2.44 in 2006. In 2007, the company also expects to increase
its marketing media spend by approximately US$4.0 million pre-
tax, as it evolves its brand marketing programs. Additionally,
the Company expects the effective tax rate in 2007 to be
approximately 31.7 percent, compared to 29.7 percent in 2006.
The higher anticipated tax rate in 2007 reflects a reduced mix
of foreign earnings, which have lower tax rates.
For the first quarter of fiscal 2007, the company expects net
sales in the range of US$575 million to US$580 million, as
compared to actual first quarter fiscal 2006 net sales of
US$575.5 million. Included in the company's net sales guidance
is an expectation for same store sales at Famous Footwear to
increase in the range of 2.5 percent to 3.5 percent. The
company also anticipates that its combined wholesale sales will
be below the first quarter results last year, with growth of its
branded business offset by the exit of the Bass license and a
sales decline in its private label business. Diluted earnings
per share for the first quarter are expected to be in the range
of US$0.27 to US$0.29, as compared to actual first quarter
fiscal 2006 diluted net earnings per share of US$0.35. The 2007
estimated earnings guidance includes after-tax costs related to
the implementation of the earnings enhancement plan of
approximately US$3.0 million. Excluding these costs results in
adjusted diluted earnings per share guidance of US$0.37 to
US$0.39, an increase of 6 percent to 11 percent compared to
US$0.35 per diluted share in the first quarter 2006.
Outlook for Fiscal 2007
Mr. Fromm concluded, "We are well positioned as we begin fiscal
2007. The majority of our brands and retail concepts are
performing well, we have initiatives in place to improve our
Brown New York brands, and we are well underway on our earnings
enhancement plan. Our priorities are to deliver great product
through innovation and differentiation and begin transforming
our brand marketing, while capitalizing on the strength of our
Famous Footwear chain. Our goals are focused on building
preeminent footwear brands and we expect fiscal 2007 to be
another year of significant accomplishments toward reaching this
objective for Brown Shoe Company."
Headquartered in St. Louis, Missouri, Brown Shoe Company, Inc.
-- http://www.brownshoe.com/-- is a US$2.3 billion footwear
company with global operations. The company operates the 900+
store Famous Footwear chain, which sells brand name shoes for
the family. It also operates 300+ specialty retail stores in
the U.S. and Canada under the Naturalizer, FX LaSalle and Via
Spiga names, and Shoes.com, the company's e-commerce subsidiary.
Brown Shoe, through its Wholesale divisions, owns and markets
leading footwear brands including Via Spiga, Naturalizer,
LifeStride, Nickels Soft, Connie and Buster Brown; it also
markets licensed brands including Franco Sarto, Dr. Scholl's,
Etienne Aigner, Bass and Carlos by Carlos Santana for adults,
and Barbie and Disney character footwear for children.
The company currently maintains offices in Brazil, Italy, China,
Hong Kong and Taiwan.
* * *
Standard & Poor's Ratings Services affirmed its 'BB' corporate
credit rating on specialty footwear retailer and wholesaler
Brown Shoe Co. Inc. The rating was removed from CreditWatch,
where it was placed with negative implications on
March 16, 2005. S&P said the outlook is negative.
At the same time, Standard & Poor's assigned its 'BB-' rating to
Brown Shoe's proposed US$150 million senior unsecured notes due
2012. These notes, to be offered pursuant to Rule 144A with
registration rights, are rated one notch below the corporate
credit rating due to the substantial amount of priority debt in
the capital structure (including borrowings from the company's
US$350 million secured revolving credit facility) relative to
total assets. Pro forma for the transaction, total funded debt
reaches about US$307 million.
Moody's Investors Service assigned a B1 rating to Brown Shoe
Company, Inc.'s US$150 million guaranteed senior unsecured notes
due 2012, a Ba3 senior implied rating, a B2 issuer rating, and
an SGL-2 Speculative Grade Liquidity Rating. Moody's said the
outlook is stable.
DURA AUTOMOTIVE: Wants Allied Move Consigned Stock Pact Assumed
---------------------------------------------------------------
Dura Automotive Systems Inc. and its debtor-affiliates seek
authority from the Honorable Kevin J. Carey of the U.S.
Bankruptcy Court for the District of Delaware to assume a
consigned stock agreement, as amended, dated March 1998, with
Allied Motion/Motor Products, Inc.
The Debtors' Atwood Mobile Products division manufactures parts
and accessories for recreational and specialty vehicles.
Pursuant to the Consigned Stock Agreement, Allied supplies motor
parts needed for Atwood's production of furnaces in its Salt
Lake City facility.
Daniel J. DeFranceschi, Esq., at Richards, Layton & Finger,
P.A., in Wilmington, Delaware, relates that after the Debtors'
bankruptcy filing, Allied (i) ceased to perform under the
Consigned Stock Agreement; and (ii) demanded improved trade
terms from the Debtors. The Debtors believe that Allied had
breached the Agreement.
Since their bankruptcy filing, the Debtors have been justifiably
concerned that suppliers could disrupt production at their
automotive, and recreational and specialty vehicles operations
if they refuse to supply the Debtors with needed parts and
equipment, Mr. DeFranceschi tells the Court.
Notwithstanding Allied's breach, the Debtors have sought to
consensually resolve any concerns that they have in a manner
that is in the best interest of their estates.
After further negotiations, on Feb. 23, 2006, the Debtors and
Allied executed a letter agreement amending the Consigned Stock
Agreement, granting the Debtors more favorable trade terms.
Due to sensitive pricing and customer-specific terms in the
Amendment Agreement, the Debtors filed with the Court a redacted
copy of the Amendment Agreement.
The terms of the Letter Agreement include:
(a) the Debtors will receive a 10% discount on amounts
otherwise payable pursuant to Section 365(b)(1)(A) of the
Bankruptcy Code, leaving an estimated cure amount of
US$297,700;
(b) each party can terminate the Consigned Stock Agreement
upon 60 days' written notice, but only after one year
from the assumption of the Consigned Stock Agreement;
(c) the Debtors agree to an enhancement of their monthly
rolling inventory commitment; and
(d) Allied will resume the consigned inventory at the Salt
Lake City Facility.
Mr. DeFranceschi asserts that assuming the Consigned Stock
Agreement, as amended, will allow the Debtors to benefit from
the improved trade terms.
The Amendment Agreement's minimum term of 10 years will provide
the Debtors certainty that, during the pivotal period in their
restructuring, Allied will not be able to opt out,
Mr. DeFranceschi contends. In the absence of the certainty and
the inventory cushion provided by the Consigned Stock Agreement,
the debtors face the real risk of a production line shutdown in
the event that shipments from Allied are delayed or withheld.
A shutdown could jeopardize Atwood's ongoing contractual
relationships with its customers and threaten a loss of
goodwill, in addition to breach of contract claims that would
inflict incalculable harm on the Debtors, Mr. DeFranceschi
maintains.
The Debtors have provided unredacted copies of the Amendment
Agreement to the U.S. Trustee, the Official Committee of
Unsecured Creditors and the ad hoc committee of certain of their
prepetition second lien secured lenders.
About DURA Automotive Systems Inc.
Rochester Hills, Mich.-based DURA Automotive Systems Inc.
(Nasdaq: DRRA) -- http://www.DURAauto.com/-- is an independent
designer and manufacturer of driver control systems, seating
control systems, glass systems, engineered assemblies,
structural door modules, and exterior trim systems for the
global automotive industry. The company is also a supplier of
similar products to the recreation vehicle and specialty vehicle
industries. DURA sells its automotive products to North
American, Japanese and European original equipment manufacturers
and other automotive suppliers.
The Debtors filed for chapter 11 petition on Oct. 30, 2006
(Bankr. D. Delaware Case No. 06-11202). Richard M. Cieri, Esq.,
Marc Kieselstein, Esq., Roger James Higgins, Esq., and Ryan
Blaine Bennett, Esq., of Kirkland & Ellis LLP are lead counsel
for the Debtors' bankruptcy proceedings. Mark D. Collins, Esq.,
Daniel J. DeFranseschi, Esq., and Jason M. Madron, Esq., of
Richards Layton & Finger, P.A. Attorneys are the Debtors' co-
counsel. Baker & McKenzie acts as the Debtors' special counsel.
Togut, Segal & Segal LLP is the Debtors' conflicts counsel.
Miller Buckfire & Co., LLC is the Debtors' investment banker.
Glass & Associates Inc., gives financial advice to the Debtor.
Kurtzman Carson Consultants LLC handles the notice, claims and
balloting for the Debtors and Brunswick Group LLC acts as their
Corporate Communications Consultants for the Debtors. As of
July 2, 2006, the Debtor had US$1,993,178,000 in total assets
and US$1,730,758,000 in total liabilities. (Dura Automotive
Bankruptcy News, Issue No. 15; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000).
DURA AUTOMOTIVE: To Make Interim Payments to Junior KMIP Members
----------------------------------------------------------------
In a stipulation approved by the U.S. Bankruptcy Court for the
District of Delaware effective Feb. 21, 2007, Dura Automotive
Systems Inc. and its debtor-affiliates, the Official Committee
of Unsecured Creditors, and the ad hoc committee of certain of
the Debtors' prepetition second lien secured lenders agree that:
(a) the Creditors Committee and the Second Lien Committee
will not object to certain interim payments of
US$440,000, in aggregate, approved on Jan. 18, 2007, by
the Compensation Committee -- a group of three
independent directors who have no direct interest in the
KMIP -- to approximately 50 non-senior management KMIP
participants;
(b) the interim payments to the Junior KMIP Participants will
be indefeasible and will not be subject to disgorgement,
provided that, the interim payments are without waiver of
or prejudice to any future payments;
(c) the interim payments for senior management KMIP
participants that the Debtors have identified to the
Creditors Committee and the Second Lien Committee, and
all other future payments under the KMIP will be subject
of a further motion;
(d) the Debtors will not seek the Court's permission to pay
the senior management KMIP participants until after
supplying a business plan proposed KMIP to the Creditors
Committee and the Second Lien Committee; and
(e) All parties reserve all rights with respect to
consideration of the KMIP, the scheduled interim payments
for Senior KMIP Participants, and all future payment
under the KMIP.
The U.S. Trustee has consented to the Stipulation.
Daniel J. DeFranceschi, Esq., at Richards, Layton & Finger,
P.A., in Wilmington, Delaware, asserts that through the
Stipulation, the Debtors are not asking the Court to approve the
KMIP at this time.
Mr. DeFranceschi emphasizes that the Stipulation will permit:
(i) the Debtors to present their business plan to the
Creditors Committee and Second Lien Committee;
(ii) the parties to negotiate a settlement regarding the KMIP
that is fair and equitable to all parties-in-interest;
and
(iii) the Creditors Committee and Second Lien Committee to
conduct the necessary due diligence to permit them to
properly evaluate the Debtors' business plan and KMIP
proposals.
Mr. DeFranceschi asserts that the Stipulation, of which the UAW
was fully aware several days prior to filing its objection,
renders moot the UAW's contention that it is premature for the
Court to consider the KMIP. The UAW will have ample
opportunity, upon the filing of the Subsequent Motion, to renew
its objection as it sees fit.
Mr. DeFranceschi further argues that the Interim Payments, as
contemplate by the KMIP:
(a) are not antithetical to "the basic purpose of a chapter 11
reorganization." They are merely one small part of a
broad paradigm shift that the Debtors has embarked upon to
restore profitability;
(b) do not implicate Section 503(c)(3) of the Bankruptcy Code,
but are instead, well within the ordinary course of
business, and are the product of a heavily-negotiated
settlement among the parties; and
(c) do not unfairly discriminate among employees. They are
targeted at those employees who are most key to the
Debtors' operational restructuring efforts.
Accordingly, the Debtors ask the Court to overrule UAW's
objection, without prejudice.
Objections
(1) U.S. Trustee
Kelly Beaudin Stapleton, the United States Trustee for Region 3,
wanted the key management incentive plan denied due to the
Debtors' failure to provide sufficient information that would
allow interested parties an opportunity to properly analyze the
proposed compensation structure.
Under the Key Management Incentive Plan, the Debtors propose
payments for approximately 55 management employees who allegedly
are involved in implementing the 50 Cubed Plan and the 510
Program. The Debtors have identified four general areas upon
which the progress or bonus payments are allegedly based.
The request is devoid of facts to support the authorization of
the proposed bonus payments, William K. Harrington, trial
attorney for the U.S. Department of Justice, stated. The
specific milestones to be achieved; the specific identity of the
participants; how the performance objectives were established;
previous recipients; and the amount of the potential awards for
each participant are not disclosed, he pointed out.
The Debtors also have not demonstrated that the proposed
executive payments are appropriate under Section 503(c) of the
Bankruptcy Code, in light of the Bankruptcy Abuse Prevention and
Consumer Protection Act of 2005 to limit payments to a debtor's
senior management, Mr. Harrington contended.
Pursuant to Section 503(c), the Debtors must demonstrate that
the proposed bonuses are "justified by the facts and
circumstances of the case" and are necessary to preserve the
value of the estate.
Mr. Harrington argued that the compensation committee appears to
have unlimited and absolute discretion to alter and amend the
KMIP plan.
The KMIP Plan also has no definitive objective structure and
thus, is structured more to ensure that the participants receive
their bonuses than for the purpose of preserving value of the
state, Mr. Harrington noted.
(2) UAW
The International Union, United Automobile, Aerospace and
Agricultural Implement Workers of America is the exclusive
collective bargaining representative of approximately
690 employees of the Debtors at their facilities in Freemont and
Mancelona, Michigan, and in LaGrange, Indiana. It is a party,
with its locals, to collective bargaining agreements with the
Debtors.
Susan Kaufman, Esq., at Heiman, Gouge & Kaufman, LLP, in
Wilmington, Delaware, related that each employee covered by the
KMIP must meet personal targets relating to the achievement of
the 50 Cubed Plan and the 510 Program in order to receive his
reward, which is a percentage of the employee's direct
compensation. However, details regarding the targets and the
amounts of rewards have not been provided, she said.
The Debtors' reorganization program heavily emphasizes job
losses rather than job preservation, Ms. Kaufman noted. A
business strategy to move better-paying jobs out of the United
States to lower-cost countries creates harsh consequences not
only for the affected workers, but for the economy as well, she
argued.
The Debtors, through the KMIP, seek to reward their executives
and management personnel who succeed by eliminating U.S.- and
Canada-based jobs through transfers to lower-costs countries.
However, the program is counterproductive to any notion the
Debtors may have of sustaining employee cooperation during the
bankruptcy, Ms. Kaufman told the Court.
Section 503(c), which severely restricts payments to insiders
for the purpose of inducing them to stay with the company,
governs payments under the KMIP, Ms. Kaufman contended.
The KMIP unfairly discriminates among its employees as it
rewards management employees in part for transferring the jobs
of its rank-and-file employees to lower-costs countries, Ms.
Kaufman maintained.
Ms. Kaufman added it is premature to approve the KMIP based on a
reorganization strategy that does not yet have the support of
creditors and stakeholders. That the Debtors already promised
payments under the KMIP is not determinative, nor indicative
that its ultimate strategy will be implemented, Ms. Kaufman
asserted.
About DURA Automotive Systems Inc.
Rochester Hills, Mich.-based DURA Automotive Systems Inc.
(Nasdaq: DRRA) -- http://www.DURAauto.com/-- is an independent
designer and manufacturer of driver control systems, seating
control systems, glass systems, engineered assemblies,
structural door modules, and exterior trim systems for the
global automotive industry. The company is also a supplier of
similar products to the recreation vehicle and specialty vehicle
industries. DURA sells its automotive products to North
American, Japanese and European original equipment manufacturers
and other automotive suppliers.
The Debtors filed for chapter 11 petition on Oct. 30, 2006
(Bankr. D. Delaware Case No. 06-11202). Richard M. Cieri, Esq.,
Marc Kieselstein, Esq., Roger James Higgins, Esq., and Ryan
Blaine Bennett, Esq., of Kirkland & Ellis LLP are lead counsel
for the Debtors' bankruptcy proceedings. Mark D. Collins, Esq.,
Daniel J. DeFranseschi, Esq., and Jason M. Madron, Esq., of
Richards Layton & Finger, P.A. Attorneys are the Debtors' co-
counsel. Baker & McKenzie acts as the Debtors' special counsel.
Togut, Segal & Segal LLP is the Debtors' conflicts counsel.
Miller Buckfire & Co., LLC is the Debtors' investment banker.
Glass & Associates Inc., gives financial advice to the Debtor.
Kurtzman Carson Consultants LLC handles the notice, claims and
balloting for the Debtors and Brunswick Group LLC acts as their
Corporate Communications Consultants for the Debtors. As of
July 2, 2006, the Debtor had US$1,993,178,000 in total assets
and US$1,730,758,000 in total liabilities. (Dura Automotive
Bankruptcy News, Issue No. 14; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000)
FIAT SPA: Indicates Hitting Sales Target for Bravo Compact
----------------------------------------------------------
Fiat S.p.A. got more than 10,000 orders of its new Bravo compact
in February, suggesting the company will reach sales target of
70,000 for the unit in 2007, Alessandro Torello writes for
Bloomberg News.
Fiat, which relied on Bravo to challenge competitors, started
selling the unit in Italy in February. It plans to introduce
the car in France, Spain and Germany in the coming weeks,
Bloomberg relates, citing Luca De Meo, head of the Fiat brand,
as saying.
In February Fiat's market share in Italy increased to 33% from
31% for the same period last year.
About Fiat S.p.A.
Headquartered in Turin, Italy, Fiat S.p.A. --
http://www.fiatgroup.com/-- manufactures and sells automobiles,
commercial vehicles, and agricultural and construction
equipment. It also manufactures, for use by the company's
automotive sectors and for sale to third parties, other
automotive-related products and systems, principally power
trains (engines and transmissions), components, metallurgical
products and production systems. Fiat's creditors include Banca
Intesa, Banca Monte dei Paschi di Siena, Banca Nazionale del
Lavoro, Capitalia, Sanpaolo IMI, and UniCredito Italiano.
Fiat operates in Argentina, Australia, Austria, Belgium, Brazil,
Bulgaria, China, Czech Republic, Denmark, France, Germany,
Greece, Hungary, India, Ireland, Italy, Japan, Lituania,
Netherlands, Poland, Portugal, Romania, Russia, Singapore,
Spain, among others.
* * *
On Feb. 12, Moody's Investors Service upgraded to Ba2 from Ba3
Fiat SpA's Corporate Family Rating and the group's other long-
term senior unsecured ratings. At the same time, Moody's
maintained the positive outlook on all long-term ratings. The
short-term non-Prime rating remains unchanged.
Issuers: Fiat Finance & Trade Ltd.
Fiat Finance Canada Ltd.
Fiat Finance Luxembourg S.A.
Fiat Finance North America Inc.
Fiat France S.A.
Fiat S.p.A.
On Jan. 30, Fitch Ratings upgraded Fiat S.p.A.'s and Fiat
Finance and Trade Ltd. S.A.'s respective Issuer Default and
senior unsecured ratings to 'BB' from 'BB-'. Fitch affirmed
Fiat's Short-term rating at 'B'. Fitch said the outlook on the
Issuer Default rating remains positive.
On Jan. 30, Standard & Poor's Ratings Services revised its
outlook on Italian industrial group Fiat SpA to positive from
stable. At the same time, Standard & Poor's affirmed the 'BB'
long-term and 'B' short-term corporate credit ratings on Fiat.
HERCULES INC: Earns US$238.7 Million in Full Year 2006
------------------------------------------------------
Hercules Inc. reported net sales of US$2.03 billion for the year
ended Dec. 31, 2006, versus net sales of US$2.05 billion for the
year ended Dec. 31, 2005. The company reported net income of
US$238.7 million for the year ended Dec. 31, 2006, compared with
a US$41.1 million net loss in 2005.
At Dec. 31, 2006, the company's balance sheet showed US$2.8
billion in total assets, US$2.55 billion in total liabilities,
US$12.7 million in minority interests, and US$242.9 million in
stockholders' equity. The company had a US$24.7 million
stockholders' deficit at Dec. 31, 2005.
Sources of Liquidity
As of Dec. 31, 2006, the company had a US$550 million Senior
Credit Facility with a syndicate of banks. Under the Senior
Credit Facility, the company has a US$150 million revolving
credit agreement, which permits certain additional borrowings.
In addition, the company has the option to borrow until
April 8, 2007, an additional US$250 million in the form of a
term note under the Senior Credit Facility.
As of Dec. 31, 2006, US$44.3 million of the US$150 million
Revolving Facility was available for use as the company had
US$105.7 million of outstanding letters of credit associated
with the Revolving Credit Facility. In addition, the company
had US$29.3 million of foreign lines of credit available and
unused.
Approximately US$41.3 million of funds remaining in one of the
trusts established in 2004 related to the settlement with
insurers with respect to asbestos claims reverted to the company
effective Jan. 4, 2007. Those funds are no longer restricted
and are available for general corporate purposes at the
Company's discretion.
Refunds
In connection with the comprehensive settlement of tax years
1993 through 2003, the Company anticipates the receipt of
refunds and interest in the range of US$230 million during 2007
with approximately US$12 million expected to be received during
the first quarter, US$147 million during the second quarter and
the remainder during the third quarter.
A full-text copy of the company's annual report is available for
free at http://ResearchArchives.com/t/s?1ad1
About Hercules, Inc.
Headquartered in Wilmington, Delaware, Hercules, Inc., (NYSE:
HPC) -- http://www.herc.com/-- is a global manufacturer and
marketer of specialty chemicals and related services. Its
principal products are chemicals for the paper industry, water-
soluble polymers, and specialty resins. The company has its
regional headquarters in China and Switzerland, and a production
facility in Brazil.
* * *
Hercules, Inc. carries Moody's Baa3 Senior Secured Debt and Bank
Loan Debt Ratings, Ba2 Long-term Corporate Family, Senior
Unsecured Debt, and Probability of Default Ratings, and B1
Junior Subordinated Debt Rating.
The company also carries Standard & Poor's BB Long-term Foreign
and Local Issuer Credit Ratings.
HUDSON HIGHLAND: Will Restate 2006 & 2005 Financial Results
-----------------------------------------------------------
As a result of a review by the U.S. Securities and Exchange
Commission, Hudson Highland Group Inc. will restate its 2006 and
2005 results, reflecting the shift of:
(1) a charge of US$643,000 previously included in 2006
results to the applicable periods in 2005, and
(2) a charge of US$923,000 previously included in 2006
results related to indeterminate periods to the opening
retained earnings balance of 2006 in accordance with the
SEC's Staff Accounting Bulletin No. 108.
These adjustments were previously reported in the company's
second quarter 2006 financial results and reduced reported
income for 2006. As a result of these changes in second quarter
results, the company's previously reported income for 2006 will
increase by approximately US$1.6 million. The company will
include these restatements in its 2006 Form 10-K, which it
expects to file on or before March 16.
About Hudson Highland
Headquartered in New York, New York, Hudson Highland Group, Inc.
(Nasdaq: HHGP)-- http://www.hhgroup.com/-- is a provider of
permanent recruitment, contract professionals and talent
management services worldwide. From single placements to total
outsourced solutions, Hudson helps clients achieve greater
organizational performance by assessing, recruiting, developing
and engaging the best and brightest people for their businesses.
The company employs more than 3,600 professionals serving
clients and candidates in more than 20 countries including
Argentina, Australia, Belgium, Brazil, and Canada.
* * *
As reported in the Troubled Company Reporter on Nov. 7, 2006,
Moody's Investors Service assigned a Ba2 rating to the company's
US$7,500,000 Income Notes Due 2042.
WEIGHT WATCHERS: Board Declares US$0.175 Per Share Cash Dividend
----------------------------------------------------------------
Weight Watchers International Inc.'s board of directors declared
its quarterly cash dividend of US$0.175 per share, which
corresponds to an annual dividend rate of US$0.70 per share.
This quarterly dividend will be payable on April 13, 2007, to
shareholders of record at the close of business on
March 30, 2007.
Headquartered in New York, U.S.A., Weight Watchers International
Inc. (NYSE: WTW) -- http://www.weightwatchersinternational.com/
-- provides weight management services, with a presence in 30
countries around the world, including Brazil, the Netherlands,
and New Zealand. The company serves its customers through
Weight Watchers branded products and services, including
meetings conducted by Weight Watchers International and its
franchisees.
At Sept. 30, 2006, the company's balance sheet showed
US$935,098,000 in total assets and US$1,038,367,000 in total
liabilities, resulting in a stockholders' deficit of
US$103,269,000. At Dec. 31, 2005, the company's stockholders'
deficit was US$80,651,000.
* * *
As reported in the Troubled Company Reporter on Jan. 9, 2007,
Standard & Poor's Ratings Services affirmed its 'BB' corporate
credit rating for New York, New York-based commercial weight-
loss service provider Weight Watchers International Inc.
At the same time, all Weight Watchers ratings were removed from
Credit Watch, where they were placed with negative implications
on Dec. 20, 2006, reflecting Weight Watchers' increasingly
aggressive financial policy after the company's disclosure that
it plans to launch a "modified Dutch auction" self-tender offer
for up to 8.3 million shares of its common stock at a price
range between US$47 and US$54 per share.
At the same time, Standard & Poor's assigned its 'BB' rating to
the company's proposed US$700 million term loan A-1 and US$500
million term loan B, with a recovery rating of '2', indicating
the expectation for substantial recovery of principal in the
event of a payment default. Standard & Poor's also lowered the
existing bank loan ratings on WWI's US$350 million term loan A
and US$500 million revolving credit facility to 'BB' from 'BB+'
and the recovery rating on these facilities to '2' from '1'.
S&P said the rating outlook is negative.
As reported in the Troubled Company Reporter on Jan. 8, 2007,
Moody's Investors Service assigned a Ba1 rating to the proposed
US$1.2 billion senior secured term loan facility of Weight
Watchers International, Inc. and affirmed existing credit
ratings. Moody's said the rating outlook remains stable.
===========================
C A Y M A N I S L A N D S
===========================
ATSUGI LOGISTICS: Sets Last Shareholders Meeting for April 6
------------------------------------------------------------
Atsugi Logistics Capital Corp. will hold its final shareholders
meeting on April 6, 2007, at 11.00 a.m., at the registered
office of the company.
These agendas will be followed during the meeting:
1) accounting of the liquidation process showing how the
winding up has been conducted and how the property will
be disposed of on April 6, 2007, the date of the final
wind up.
2) authorize the Liquidators to retain the records of the
company for a period of five years from the dissolution
of the company, after which they may be destroyed.
A member entitled to attend and vote at the meeting will be
allowed to appoint a proxy, who need not be a member, in his
stead.
The company's liquidator can be reached at:
John Cullinane
Derrie Boggess
c/o Walkers SPV Limited
Walker House, 87 Mary Street
P.O. Box 908
Grand Cayman KY1-9002
Cayman Islands
BANCO BRADESCO: Grand Cayman Unit Issues US$200-Million of Bonds
----------------------------------------------------------------
Banco Bradesco SA said in a statement that its unit in Grand
Cayman has made a one-year, US$200-million bond issue on the
Luxembourg market.
Business News Americas relates that the bonds will mature on
April 1, 2008, and pay 5.5% per year.
The report says that BNP Paribas was the "bookrunner" and joint
lead bank, along with Bradesco Cayman.
Banco Bradesco conducted in May 2005 a US$300-million perpetual
bond issue, the first of its kind by a Brazilian firm. In
December 2004, it raised US$100 million through a three-year,
real-denominated issue on the foreign market, BNamericas states.
Headquartered in Sao Paulo, Brazil, Banco Bradesco S.A. Banco
(NYSE: BBD) -- http://www.bradesco.com.br/-- prides itself on
serving low-and medium-income individuals in Brazil since the
1960s. Bradesco is Brazil's largest private bank, with more
than 3,000 banking branches, and also a leader in insurance and
private pension management. Bradesco has branches throughout
Brazil as well as one in New York, and Japan. Bradesco offers
Internet banking, insurance, pension plans, annuities, credit
card services (including football-club affinity cards for the
soccer-mad population), and Internet access for customers. The
bank also provides personal and commercial loans, along with
leasing services.
* * *
As reported in the Troubled Company Reporter-Latin America on
Jan. 26, 2007, Fitch Ratings affirmed these issuer default
ratings on Bradesco, with a Stable Outlook:
-- Long-term foreign currency at 'BB+';
-- Long-term local currency at 'BBB-';
-- Individual rating at 'B/C';
-- Local currency short-term at 'F3';
-- Short-term at 'B';
-- Support rating of '4';
-- National short-term rating 'F1+(bra)'; and
-- National long-term rating 'AA+(bra)'.
* * *
As reported in the Troubled Company Reporter-Latin America on
Nov. 27, 2006, Standard & Poor's Ratings Services maintained the
'BB+' ratings on both of Banco Bradesco SA's foreign and local
currency counterparty credit rating, however it changed the
ratings outlook to positive from stable on both ratings:
-- Foreign currency counterparty credit rating
* to BB+/Positive/B from BB+/Stable/B
-- Local currency counterparty credit rating
* to BB+/Positive/B from BB+/Stable/B
-- Brazil national scale rating
* to brAA+/Positive/brA-1 from brAA+/Stable/brA-1
CITIGROUP CREDIT: Will Hold Last Shareholders Meeting on April 9
------------------------------------------------------------
Citigroup Credit Management Company Ltd. will hold its final
shareholders meeting on April 9, 2007, at 11:30 a.m., at:
Citigroup Financial Products Inc.
1209 Orange Street
Wilmington, Delaware 19801
USA
These agendas 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) hearing any explanation that may be given by the
liquidator.
A member entitled to attend and vote at the meeting will be
allowed to appoint a proxy, who need not be a member, in his
stead.
The liquidator can be reached at:
Joseph Draper
17A Regence Royale, 2 Bowen Road
Mid Levels, Hong Kong
S.A.R.
DABENREAL INDUSTRIES: Sets Last Shareholders Meeting for April 6
----------------------------------------------------------------
Dabenreal Industries will hold its final shareholders meeting on
April 6, 2007, at:
Oceanic Bank And Trust Limited
TK House, Bayside Executive Park
West Bay St. And Blake Road
P.O. Box AP 59213
Nassau, Bahamas
These agendas 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 will be
allowed to appoint a proxy, who need not be a member, in his
stead.
The liquidator can be reached at:
Alpha Direction Ltd.
Oceanic Bank and Trust Limited
TK House, Bayside Executive Park
West Bay St. And Blake Road
P.O. Box AP 59213
Nassau, Bahamas
MAYMIN FUND: Proofs of Claim Filing Ends on April 6
---------------------------------------------------
Maymin Fund International, Ltd.'s creditors are given until
April 6, 2007, to prove their claims to Philip Maymin, the
company's liquidator, or be excluded from receiving any
distribution or payment.
In their proofs of claim, creditors must indicate their full
names, addresses, the full particulars of their debts or claims,
and the names and addresses of their lawyers, if any.
Maymin Fund's shareholders agreed on Dec. 28, 2006, to
place the company into voluntary liquidation under The Companies
Law (2004 Revision) of the Cayman Islands.
The liquidator can be reached at:
Philip Maymin
222 Railroad Avenue
Greenwich, Connecticut 06830
USA
MAYMIN MASTER: Proofs of Claim Filing Deadline Is April 6
--------------------------------------------------------
Maymin Master Fund, Ltd.'s creditors are given until
April 6, 2007, to prove their claims to Philip Maymin, the
company's liquidator, or be excluded from receiving any
distribution or payment.
In their proofs of claim, creditors must indicate their full
names, addresses, the full particulars of their debts or claims,
and the names and addresses of their lawyers, if any.
Maymin Master's shareholders agreed on Dec. 21, 2006, to
place the company into voluntary liquidation under The Companies
Law (2004 Revision) of the Cayman Islands.
The liquidator can be reached at:
Philip Maymin
222 Railroad Avenue
Greenwich, Connecticut 06830
USA
MEADS COMPANY: Sets Last Shareholders Meeting for April 6
---------------------------------------------------------
Meads Company Ltd. will hold its final shareholders meeting on
April 6, 2007, at the liquidator's place of business:
Diana J. Murphy
24 Old Powderhouse Road
Lakeville, Massachusetts, 02347
USA
These agendas 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 will be
allowed to appoint a proxy, who need not be a member, in his
stead.
TRINITY INVESTMENT: Sets Last Shareholders Meeting for April 6
------------------------------------------------------------
Trinity Investment Fund Ltd. will hold its final shareholders
meeting on April 6, 2007, at 10:00 a.m., at:
1 Aloha Tower Drive, Suite 3100
Honolulu, Hawaii
USA
These agendas 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) hearing any explanation that may be given by the
liquidator.
A member entitled to attend and vote at the meeting will be
allowed to appoint a proxy, who need not be a member, in his
stead.
The liquidator can be reached at:
Kevin Hayashi
Attention: Ian Goodall
1 Aloha Tower Drive, Suite 3100
Honolulu, HI 96826
USA
Telephone: +1 345 949 4244
Fax: +1 345 949 8635
UBS PACTUAL: Fitch Affirms & Withdraws Ratings
----------------------------------------------
Fitch Ratings has affirmed the long-term foreign currency issuer
default rating 'BB+', short-term foreign currency rating 'B' and
support rating '3' of UBS Pactual Overseas Corporation. In
addition, Fitch has withdrawn the ratings. The outlook of the
long-term IDR of UBS POC was positive, following the rating
outlook of the sovereign IDRs.
UBS POC is based on Cayman Island and 100% controlled by Banco
UBS Pactual S.A. In December 2006, following the successful
closing of the sale of Banco Pactual S.A and its subsidiaries to
UBS AG, both institutions became full subsidiaries of UBS, the
largest bank of Switzerland and one of the largest in the world.
Founded in 1983, UBS Pactual is the 11th-largest private bank in
Brazil in asset and one of the leaders in investment banking,
strongly renowned in its niches.
=========
C H I L E
=========
ROYAL & SUNALLIANCE: A.M. Best Cuts Financial Strength Ratings
--------------------------------------------------------------
A.M. Best Co. has downgraded the financial strength ratings to
C+ (Marginal) from C++ (Marginal) and the issuer credit ratings
to "b-" from "b" for the Royal & SunAlliance USA Insurance Pool
(Wilmington, Del.) and its members, as well as its separately
rated affiliate, Royal Surplus Lines Insurance Company
(Wilmington, Del.).
On March 3, 2007, R&SA USA Pool's name was changed to Arrowpoint
Capital Pool (Wilmington, DE). The ratings have been removed
from under review with developing implications and assigned a
negative outlook.
Subsequently, A.M. Best has withdrawn the FSRs and ICRs and
assigned a category NR-4 (Company Request) to RSLIC and the
members of the Arrowpoint Pool. Concurrently, A.M. Best has
withdrawn the FSR and ICR and assigned a category NR-5 (Not
Formerly Followed) to Arrowpoint Pool. These rating actions
reflect management's decision to withdraw from A.M. Best's
interactive rating process.
The Arrowpoint Pool includes Royal Indemnity Company and
Security Insurance Company of Hartford. These two companies,
along with RSLIC, have been in run-off since 2003. On March 3,
2007, Royal & Sun Alliance Insurance Group plc (United Kingdom)
[LSE: RSA] completed the sale of its U.S. operations to
Arrowpoint Capital Corporation, a registered Delaware
corporation founded by Royal & Sun U.S. senior managers and
outside directors.
As part of the transaction, the former U.K. parent contributed
US$287.5 million in additional capital to the group. Arrowpoint
Capital acquired the U.S. operations for US$300 million in
deferred consideration, payment of which will be based on the
future performance of the run-off.
Founded in 1899, A.M. Best Company is a full-service credit
rating organization dedicated to serving the financial services
industries, including the banking and insurance sectors.
Headquartered in London, United Kingdom, Royal & Sun Alliance
Insurance Group Plc -- http://www.royalsunalliance.com/--
provides risk management and insurance solutions through two
divisions focusing on property & casualty business and personal
insurance. The group consists of three regions -- U.K.,
Scandinavia and International. The group operates in the U.K.,
Argentina, Bahrain, Belgium, Brazil, Canada, Chile, China,
Colombia, Denmark, Egypt, France, Germany, Hong Kong, India,
Ireland, Italy, Latvia, Lithuania, Malaysia, Mexico, Netherland
Antilles, the Netherlands, Norway, Oman, Saudi Arabia,
Singapore, Sweden, UAE, Uruguay, U.S.A. and Venezuela.
* * *
A.M. Best Co. has placed the financial strength ratings of C++
(Marginal) and the issuer credit ratings of "b" of the Royal &
SunAlliance U.S.A. Insurance Pool and Royal Surplus Lines
Insurance Company under review with developing implications
pending the completion of the proposed sale of these operations
to Arrowpoint Capital, a new company formed by the existing
management team of these operations. All the above companies
are domiciled in Wilmington, Delaware. R&SAUS and RSLIC are
U.S. subsidiaries of Royal & Sun Alliance Insurance Group plc
(London, England).
Standard & Poor's Ratings Services lowered its counterparty
credit and insurer financial strength ratings on Royal & Sun
Alliance Insurance Group PLC's U.S. insurance operations (RSA
USA) to 'BB' from 'BB+'. S&P said the outlook remains negative.
At the same time, the ratings were withdrawn at the request of
the companies' management.
===============
C O L O M B I A
===============
BANCOLOMBIA: Reports COP80 Billion Net Income in February 2007
--------------------------------------------------------------
Bancolombia SA reported unconsolidated net income of COP80,005
million during the past month of February.
During February, total net interest income, including investment
securities amounted to COP129,109 million. Additionally, total
net fees and income from services totaled in the month COP50,247
million.
Total assets amounted to COP26.61 trillion, total deposits
totaled COP17.83 trillion and Bancolombia's total shareholders'
equity amounted to COP3.55 trillion.
Bancolombia's (unconsolidated) level of past due loans as a
percentage of total loans was 2.54% as of Feb. 28, 2007, and the
level of allowance for past due loans was 140.99%.
The sale of Bancolombia's participation in ALMACENAR generated a
loss on sale of investments on equity securities. However, this
loss was fully provisioned explaining the increase of provision
recoveries during the month. As a result, such events had no
effect on the net income for the month of February.
Dividend income amounted to COP55,358 million for the month of
February.
Market Share
According to ASOBANCARIA (Colombia's national banking
association), Bancolombia's market share of the Colombian
Financial System in January 2007 was as follows:
* 17.8% of total deposits,
* 19.9% of total net loans,
* 18.5% of total savings accounts,
* 20.9% of total checking accounts and
* 13.2% of total time deposits.
Bancolombia is Colombia's largest full-service financial
institution, formed by a merger of three leading Colombian
financial institutions. Bancolombia's market capitalization is
over US$5.5 billion, with US$13.8 billion asset base and US$1.4
billion in shareholders' equity as of Sept. 30, 2006.
Bancolombia is the only Colombian company with an ADR level III
program in the New York Stock Exchange.
* * *
As reported in the Troubled Company Reporter-Latin America on
Jan. 2, 2007, Moody's Investors Service placed the D+ bank
financial strength rating of Bancolombia SA on review for
possible downgrade. Bancolombia's foreign currency deposit
ratings were affirmed at Ba3/Not-Prime.
As reported in the Troubled Company Reporter on Feb. 6, 2007,
Fitch Ratings affirmed Bancolombia's long-term and short-term
foreign currency Issuer Default Ratings:
* Foreign currency long-term IDR at 'BB+';
* Foreign currency short-term rating at 'B';
* Support rating at '3'.
Moody's said the rating outlook is stable.
The ratings remain on rating watch negative:
* Individual rating of 'C';
* Local currency long-term IDR of 'BBB-';
* Local currency short-term rating of 'F3'.
* COLOMBIA: Scrap Sale Brings in Over COP5.7 Billion
----------------------------------------------------
Business News Americas reports that the sale of more than 615
tons of scrap copper, brass and aluminum has brought in COP5.7
billion to the Colombian government.
According to BNamericas, the government organized seven business
rounds that started in August 2006 to sell scrap.
Colombian's commerce, industry and tourism ministry posted on
its Web site that seven deals that total COP470 million were
closed for the sale of non-ferrous scrap in the latest round
held last week at the local mercantile exchange.
BNamericas underscores that the government wants to formalize
the country's scrap market, coordinating producers and exporters
to guarantee a reliable supply of the raw material to the
domestic market.
Non-ferrous scrap producers and exporters signed in July 2006 a
compensation accord with the government to supply the domestic
market with 350 tons per month of scrap after the processing
sector complained about a shortage of raw materials for local
consumption, BNamericas states.
* * *
On July 25, 2006, Fitch rated the Republic of Colombia's US$1
billion issue of fixed-rate Global Bonds maturing Jan. 27, 2017,
BB. The rating is in line with Fitch's long-term foreign
currency rating on Colombia. Fitch said the rating outlook is
positive.
===================
C O S T A R I C A
===================
ALCATEL-LUCENT: CEO Predicts Revenue Growth During Restructuring
----------------------------------------------------------------
Alcatel-Lucent Chief Executive Officer Patricia Russo is
positive that the newly merged company can achieve revenue
growth in 2007 even while implementing post-merger restructuring
that includes shedding 12,500 jobs, the Financial Times reports.
Ms. Russo told FT that some employees felt uncertain and anxious
because their future in the group remains unpredictable. She
said that the group plans to address that problem by immediately
disclosing the exact number of lost jobs for every country
involved.
Alcatel-Lucent got off to a poor start, a mere seven weeks after
the French and U.S. company's merger, when it issued a profit
warning in January ahead of its 2006 financial report, FT
states.
But Ms. Russo was optimistic, saying: "We believe we can resume
growth as we move through the year." She believes the group
could use a "stronger second half."
"I have every expectation the folks focused on winning contracts
and closing orders and driving the business forward are going to
do that, and that we are in fact going to execute the
integration plans," Ms. Russo added.
As reported on Feb. 13, Alcatel-Lucent registered EUR522 million
in net profit on EUR18.25 billion in net revenues for the full
year 2006, compared with EUR1.67 billion in net profit on
EUR18.57 billion in net revenues for the full year 2005.
The company reported EUR618 million in net losses against
EUR4.42 billion in net revenues for the fourth quarter 2006,
compared with EUR381 million in net profit on EUR5.25 billion in
net revenues for the same period in 2005.
About Alcatel-Lucent
Headquartered in Paris, France, Alcatel-Lucent --
http://www.alcatel-lucent.com/-- provides solutions that enable
service providers, enterprises and governments worldwide, to
deliver voice, data and video communication services to end
users. Through its operations in fixed, mobile and converged
broadband networking, Internet protocol (IP) technologies,
applications, and services, Alcatel-Lucent offers the end-to-end
solutions that enable communications services for people at
home, at work, and on the move.
On Nov. 30, 2006, Alcatel and Lucent Technologies Inc. completed
their merger transaction, and began operations as a
communication solutions provider under the name Alcatel-Lucent
on Dec. 1, 2006.
Alcatel-Lucent maintains operations in 130 countries, including,
Austria, Germany, Hungary, Italy, Netherlands, Ireland, Canada,
United States, Costa Rica, Dominican Republic, El Salvador,
Guatemala, Peru, Venezuela, Australia, Brunei, and Cambodia.
* * *
As of Feb. 7, Alcatel-Lucent's Long-Term Corporate Credit rating
and Senior Unsecured Debt carry Standard & Poor's BB- rating.
It's Short-Term Corporate Credit rating stands at B.
Moody's, on the other hand, put a Ba2 rating on Alcatel's
Corporate Family and Senior Debt rating. Lucent carries Moody's
B1 Senior Debt rating and B2 Subordinated debt & trust preferred
rating.
Fitch rates Alcatel's Issuer Default Rating and Senior Unsecured
Debt rating at BB.
=======
C U B A
=======
SHERRITT INTERNATIONAL: Will Export Cuban Oil
---------------------------------------------
Canadian energy firm Sherritt International told Miami Herald
that it will export Cuban oil.
According to Miami Herald, oil -- potentially billions of
barrels of reserves -- was discovered in the Florida Straits and
near the Cuban shoreline. It has improved Cuba's energy
prospects and caught the attention of the U.S. oil industry.
Sherritt International said in a report about its record 2006
earnings that it will export in 2007 a portion of its Cuban
output as a consequence of anticipated production growth and
limited demand for domestic heavy oil.
Miami Herald notes that Sherritt International reported US$1
billion revenue in 2006. It also disclosed that it produced
68,000 barrels of crude oil in Cuba.
Plans for exporting the oil are still being discussed, Miami
Herald says, citing Sherritt International spokesperson Michael
Minnes.
Miami Herald relates that the move could put the crude "on a
collision course" with the trade ban the US imposed on Cuba.
Cuban-American U.S. Representative Lincoln Diaz-Balart told
Miami Herald, "Sherritt is on the 'short list' of companies that
will have very serious civil as well as criminal legal problems
in Cuba when the Cuban people recover their sovereignty and have
a government that fights for their rights. Their oil
investments will involve but a small part of their legal
problems once the rule of law returns to Cuba."
Sherritt International or any other oil firm would face the
challenge of how to commercialize crude oil outside Cuba without
breaking the US embargo, Miami Herald notes, citing oil expert
Jorge R. Pinon.
"Inevitably wherever this crude oil is processed in the
Caribbean region, there is a high probability that its
byproducts will find their way into the US markets," Mr. Pinon
commented to Miami Herald.
Mr. Minnes told Miami Herald, "We respect US law. We have no
intention of selling it into a situation that would affect the
embargo."
Meanwhile, demand in Cuba for the oil has declined as the nation
is increasingly using diesel generators for electricity
production instead of burning crude, Miami Herald states, citing
Mr. Minnes.
Headquartered in Toronto, Ontario, Canada -- Sherritt
International Corporation -- http://www.sherritt.com-- is a
diversified natural resource company. The company directly and
through its subsidiaries has interests in thermal coal
production, a vertically integrated nickel/cobalt metals
business, oil and gas exploration, development and production,
and electricity generation. It also has interests in soybean-
based food processing, tourism and agriculture. The company's
coal business comprises the sale of thermal coal, primarily to
domestic utilities as fuel to generate electricity. Sherritt
International's Metals segment is comprised of its 50% indirect
interest in the Metals Enterprise and its marketing and trading
activities in commodity metals, as well as the company's
fertilizer and utilities assets. Sherritt International
explores for, develops and produces oil and gas, primarily from
oil fields situated in Cuba. The company, through a wholly
owned subsidiary Powerco, holds a one-third interest in Energas.
Sherritt International, in a joint venture with the Cuban
government, has been drilling for oil in Cuba for over 10 years,
gradually increasing production to the point that domestic
output provides almost 50% of Cuba's petroleum needs. Sherritt
International doesn't have offshore wells. Its onshore
equipment drills horizontally into petroleum reservoirs located
under the water.
* * *
As reported in the Troubled Company Reporter-Latin America on
Dec. 19, 2006, Dominion Bond Rating Service confirmed the
ratings of Sherritt International Corporation, with the Senior
Unsecured Debt rated at BB (high) and the Convertible
Subordinated Debentures at BB. Dominion says the trends were
stable.
===================================
D O M I N I C A N R E P U B L I C
===================================
* DOMINICAN REPUBLIC: Montecristi, Samana Towns Want AES Money
--------------------------------------------------------------
The Dominican Republic's Montecristi and Samana provinces have
demanded from the national government the US$6 million
settlement that AES Corporation paid to avoid a costly
litigation of an ash-dumping case.
The governor of Samana and the mayor of Manzanillo both demanded
that the settlement paid must be spent to mitigate the human and
ecological damages caused by the rockash, the Dominican Today
says.
According to the same paper, about 82,000 tons of coal ash from
AES' plants were dumped in the beaches of these two provinces.
The government has previously asked for US$80 million in
damages, but consented to the much-lower payment to settle the
dispute.
Dominican's Environment Minister Max Puig said in a published
report that the final removal of the waste from those places
will be to the towns' benefit.
"To retire the material completely from those places is a
benefit. In that regard, the fundamental benefit is for the
communities," the environment minister said in an interview with
the newspaper Listin Diario.
The minister clarified that the judicial process does not end
with the settlement. The proceeding in the country will still
continue its course and the Dominican State is interested in
getting Justice, Dominican Today relates.
The money, according to Mr. Puig, will be paid to the companies
who'd remove the waste materials from those towns.
* * *
The Troubled Company Reporter-Latin America reported on
May 9, 2006, that Fitch Ratings upgraded these debt and issuer
Default Ratings of the Dominican Republic:
-- Long-term foreign currency Issuer Default Rating
to B from B-;
-- Country ceiling upgraded to B+ from B-;
-- Foreign currency bonds due 2006 to B-/RR4 from CCC+/RR4;
-- Foreign currency Brady bonds due 2009 to B/RR4
from B-/RR4;
-- Foreign currency bonds due 2011 to B/RR4 from B-/RR4;
-- Foreign currency bonds due 2013 to B-/RR4 from CCC+/RR4;
-- Foreign currency bonds due 2018 to B/RR4 from B-/RR4; and
-- Foreign currency collateralized Brady bonds due 2024
to B+/RR3 from B/RR3.
Fitch also affirmed these ratings:
-- Long-term local currency Issuer Default Rating: B; and
-- Short-term Issuer Default Rating: B.
Additionally, Fitch assigned a debt and Recovery Rating to this
issue:
-- Foreign currency bonds due 2027: B/RR4.
Fitch said the rating outlook for the long-term foreign and
local currency IDRs is Stable.
=============
E C U A D O R
=============
* ECUADOR: Allots US$15MM Emergency Fund for Highway Works
----------------------------------------------------------
The Ecuadorian government has allocated a US$15-million
emergency fund for the construction of a highway that will link
districts Bolivar and Pichincha, local paper La Hora reports.
Bolivian Mayor Ramon Gonzalez told Business News Americas that
the 48-kilometer highway had been requested for a number of
years, as it would boost connectivity between the Manabi
province and city Guayaquil.
BNamericas underscores that the current road linking the
districts is over 120 kilometers long, while the new highway
will be 60 kilometers long -- including access roads -- and will
incorporate the construction of a bridge.
The provincial and national governments will sign the agreement
for the financing in two weeks, BNamericas states.
* * *
As reported in the Troubled Company Reporter on Jan. 25, 2007,
Fitch Ratings downgraded the long-term foreign currency Issuer
Default Rating of Ecuador to 'CCC' from 'B-', indicating that
default is a real possibility in the near term.
In addition, these ratings were downgraded:
-- Uncollateralized foreign currency bonds to
'CCC/RR4' from 'B-/RR4';
-- Collateralized foreign currency Par and Discount
Brady bonds to 'CCC+/RR3' from 'B/RR3'; and
-- Short-term foreign currency IDR to 'C' from 'B'.
Fitch also affirmed the Country ceiling rating at 'B-'.
* ECUADOR: Mulls Tender Process for Guayaquil Port Concession
-------------------------------------------------------------
An official form the Ecuadorian transport and public works
ministry told Business News Americas that the office is
considering holding a new tender process for the concession of
the Guayaquil port.
BNamericas relates that Guayaquil port handles 70% of the
Ecuador's cargo.
Due to questions that arose regarding the validity of the
original bidding process that the Guayaquil port authority held
to 2006, Minister Trajano Andrade is still studying the
possibility of declaring void the concession process and holding
a new one, BNamericas notes, citing the official. If the
minister decides to call off the process, the decision must also
be authorized by the national council of merchant marines to
become official. A final decision will be released this week.
According to BNamericas, the Philippine company International
Container Terminal Services -- in a strategic alliance with
Singapore's PSA -- was the sole bidder for the concession in
December 2006. A second consortium made up of Transagent,
Inversores Cosmos, Empresas Navieras and HHLA Container Terminal
decided to withdraw from the process, allegedly due to a lack of
transparency.
BNamericas underscores that the port's concession was to be
awarded by the start of this year. However, the process was
delayed until President Rafael Correa named a new presidential
representative to port's board of directors.
A source from the ministry told BNamericas that the process
could be delayed by a year if a new tender is held. However,
government officials said that it will take much less. Since
the project is a priority, they will make sure new bidding rules
are available as soon as possible.
However, a decision hasn't been made regarding the process,
BNamericas says, citing the official. If a tender is held
again, interested bidders have already made some advances, as
they already took part in the original concession process.
BNamericas emphasizes that 10 entities had shown interest in the
project, and seven were prequalified.
The 20-year concession will require an up to US$150 million
investment. The concessionaire will also have the option of
participating in the funding of additional port services, like a
tax-free zone in Guayas, which requires about US$15 million,
BNamericas states.
* * *
As reported in the Troubled Company Reporter on Jan. 25, 2007,
Fitch Ratings downgraded the long-term foreign currency Issuer
Default Rating of Ecuador to 'CCC' from 'B-', indicating that
default is a real possibility in the near term.
In addition, these ratings were downgraded:
-- Uncollateralized foreign currency bonds to
'CCC/RR4' from 'B-/RR4';
-- Collateralized foreign currency Par and Discount
Brady bonds to 'CCC+/RR3' from 'B/RR3'; and
-- Short-term foreign currency IDR to 'C' from 'B'.
Fitch also affirmed the Country ceiling rating at 'B-'.
* ECUADOR: To Make Timely Payment on Debts, Minister Patino Says
----------------------------------------------------------------
Ecuador's Finance Minister said in reports the country would
probably make its next payment on time given that the government
faces no immediate financial problem, Bloomberg News reports.
"I expect we'll make the payment," the finance minister told
reporters. "Our creditors should know that we're very
responsible. We're not going to ignore foreign debt
obligations."
The country's president, Rafael Correa, made default threats
earlier this year, which put investors on edge. Fears were
allayed when Ecuador made its payment a day after it announced
it would use a 30-day grace period to pay US$135 million in
interest payments due Feb. 15.
According to the finance minister, the government is still in
the process of renegotiating debt payments with the World Bank
and the Inter-American Development Bank, Bloomberg says.
The yield on Ecuador's benchmark 10% bond due in 2030 closed
down to 11.75%, its lowest since Feb. 26. The price rose 2.1
cents, or 2.5%, to 86.1 cents on the dollar, according to
JPMorgan Chase & Co.
As reported on Jan. 25, 2007, Fitch Ratings downgraded the long-
term foreign currency Issuer Default Rating of Ecuador to 'CCC'
from 'B-', indicating that default is a real possibility in the
near term.
=====================
E L S A L V A D O R
=====================
SPECTRUM BRANDS: Gets US$1.6-Bil. Pledge to Refinance Bank Loan
---------------------------------------------------------------
Spectrum Brands Inc. reported that Goldman Sachs and Bank of
America have provided a commitment to refinance Spectrum Brands'
existing bank credit facility. This commitment provides for a
new bank credit facility in the aggregate principal amount of at
least US$1.6 billion with a six-year maturity. The refinancing
will be completed by March 30, 2007.
Spectrum Brands President and Chief Executive Officer David
Jones stated: "We are very pleased to have reached this
refinancing agreement, which will provide us with the financial
flexibility to pursue additional steps to improve our capital
structure in an orderly manner, while continuing to strengthen
our operating businesses. We remain keenly focused on
completion of asset sales to reduce our outstanding debt and
leverage. We believe the Company is on the right track to
creating long-term sustainable value."
The commitment of Goldman Sachs and Bank of America is subject
to customary terms and conditions, including negotiation and
execution of definitive loan documentation. Goldman Sachs will
lead the refinancing and act as joint lead arranger, joint
bookrunner and sole syndication agent. Bank of America will act
as joint lead arranger and joint bookrunner. There can be no
assurances that the anticipated refinancing will be completed
or, if completed, what the time or terms of such transaction
will be.
Headquartered in Atlanta, Georgia, Spectrum Brands (NYSE: SPC)
-- http://www.spectrumbrands.com/-- is a consumer products
company and a supplier of batteries and portable lighting, lawn
and garden care products, specialty pet supplies, shaving and
grooming and personal care products, and household insecticides.
Spectrum Brands' products are sold by the world's top 25
retailers and are available in more than one million stores in
120 countries around the world. The company operates in 13
Latin American nations including El Salvador, Guatemala, Costa
Rica, Colombia and Nicaragua.
* * *
As reported in the Troubled Company Reporter-Latin America on
Feb, 12, 2007, Standard & Poor's Ratings Services lowered all of
its ratings on Atlanta, Ga.-based Spectrum Brands Inc.,
including the company's corporate credit rating, which was
lowered to 'CCC+' from 'B-'. S&P said the outlook is
developing.
=================
G U A T E M A L A
=================
BRITISH AIRWAYS: Eyes 5-6 Percent Revenue Increase in 2007-2008
---------------------------------------------------------------
At its annual Investor Day on March 7, British Airways plc
released market guidance for the financial year 2007-2008.
Revenue is forecast to increase by 5 to 6 percent based on
capacity measured in available-seat-kilometers up 1.3 percent,
traffic measured in revenue-passenger-kilometers up 2.4 percent
and yield measured in pence per RPK up 3.4 percent.
Fuel is forecast to be up by some GBP100 million for 2007-2008.
Total costs, excluding fuel are forecast to be up GBP50 million.
This will leave the company on track to achieve a 10% operating
margin in the year to March 2008.
About the Company
Headquartered in West Drayton, United Kingdom, British Airways
Plc -- http://www.ba.com/-- operates of international and
domestic scheduled and charter air services for the carriage of
passengers, freight and mail, and provides of ancillary
services. The British Airways group consists of British Airways
Plc and a number of subsidiary companies including in particular
British Airways Holidays Limited and British Airways Travel
Shops Limited. BA has offices in India and Guatemala.
* * *
British Airways' 7-1/4% senior unsubordinated notes due 2016 and
10-7/8% notes due 2008 carry Moody's Investors Service's Ba2
ratings and Standard & Poor's BB- ratings.
=============
J A M A I C A
=============
AIR JAMAICA: IMF Still Recommends Airline's Closure
---------------------------------------------------
The International Monetary Fund still thinks that the Jamaican
government should close down or sell Air Jamaica, The Jamaica
Gleaner reports.
As reported in the Troubled Company Reporter-Latin America on
Sept. 18, 2006, IMF suggested to the government Air Jamaica's
shutdown. IMF wanted radical action like shutting down Air
Jamaica and allowing its routes to be covered by private
airlines. The IMF had given the same suggestion in previous
analyses of the Jamaican economy in the late 1990s.
The Gleaner relates that after the IMF mission reviewed the
Jamaican economy's performance in February, it is still not
convinced that Air Jamaica's latest restructuring plans will
help the airline recover.
The IMF said in a document tabled in Parliament by Finance
Minister Dr. Omar Davies, "While privatization of the sugar
company will add to the debt in the short-run because of
Government plans to take over its debt (on divestment), it
should help to improve public finances in the longer term."
IMF commented to The Gleaner, "Regards Air Jamaica, given that
repeated restructuring plans have not succeeded in placing its
finances on a solid footing, the mission recommends considering
similar decisive action."
The Gleaner underscores that the Jamaican government defended
Air Jamaica as a strategic asset, critical to the nation's
important tourism industry.
According to The Gleaner, Jamaican officials are positive that
without Air Jamaica, foreign carriers wouldn't sufficiently
provide air seats to Jamaica, limiting tourism traffic or
causing a steep increase in fares and weakening investment in a
sector that had "robust flows".
The Gleaner emphasizes that the more immediate concern of the
IMF was Air Jamaica's most recent performance, with losses that
more than doubled what was forecasted. The Sugar Company of
Jamaica and the Jamaica Urban Transit Company also provided a
deficit that will be 1% of gross domestic product in the current
financial year.
The Jamaica government would have to guarantee financial
discipline at its off-budget entities, if it is to lessen its
debt burdens and ensure macro-economic stability, The Gleaner
states, citing IMF.
"The mission believes that there is some scope to reduce
expenditures in fiscal year 2007/2008, given the large expansion
in their capital spending in the current year. Such
consolidation would also enable more of the concessional
PetroCaribe funds that are now going to finance off-budget
entities to replace expensive central government debt, further
reducing the debt ratio," IMF told The Gleaner.
Headquartered in Kingston, Jamaica, Air Jamaica --
http://www.airjamaica.com/-- was founded in 1969. It flies
passengers and cargo to almost 30 destinations in the Caribbean,
Europe, and North America. Air Jamaica offers vacation packages
through Air Jamaica Vacations. The company closed its intra-
island services unit, Air Jamaica Express, in October 2005. The
Jamaican government assumed full ownership of the airline after
an investor group turned over its 75% stake in late 2004. The
government had owned 25% of the company after it went private in
1994. The Jamaican government does not plan to own Air Jamaica
permanently.
* * *
On July 21, 2006, Standard & Poor's Rating Services assigned B
long-term foreign issuer credit rating on Air Jamaica Ltd.,
which is equal to the long-term foreign currency sovereign
credit rating on Jamaica, is based on the government's
unconditional guarantee of both principal and interest payments.
* JAMAICA: Trinidad Wants Venezuela to Supply Nation with LNG
-------------------------------------------------------------
Trinidad & Tobago will try to get natural gas from Venezuela to
refine it and then send to Jamaica, The Jamaica Gleaner reports.
As reported in the Troubled Company Reporter-Latin America on
March 1, 2007, Trinidad & Tobago said it wouldn't honor a
Memorandum of Understanding to supply Jamaica with liquefied
natural gas. Trinidad & Tobago had promised supplies to produce
electricity for domestic use.
However, Trinidad & Tobago is exploring options to carry out the
supply accord it signed with Jamaica three years ago, The
Gleaner notes.
The Gleaner relates that Trinidad & Tobago Prime Minister
Patrick Manning will discuss in a meeting with Venezuelan
President Hugo Chavez in Caracas the possibility of sourcing of
natural gas from Venezuela.
"We are not driven by ego, but we are driven by the need to get
the work of the people done in the Caribbean. It is a critical
issue. And if it requires my going to Venezuela to have it
settled, I will do that," Prime Minister Manning told The
Gleaner.
Sourcing liquefied natural as supplies from Trinidad's Atlantic
liquefied natural gas was still being considered, The Gleaner
states, citing Prime Minister Manning.
* * *
As reported on Mar. 9, 2007, Standard & Poor's Ratings Services
affirmed its 'B' ratings on Jamaica's long-term and short-term
sovereign credit, with stable outlook.
* JAMAICA: US$350-Million of Bonds Issued Over-Subscribed
---------------------------------------------------------
Jamaica's US$350 millions of bonds due 2039 is five times over-
subscribed, suggesting investor interest in emerging market
securities had not waned.
In a filing with the U.S. Securities and Exchange Commission,
the government said the bonds will yield 3.46 percentage points,
or 8.125%. Jamaica will pay principal on the notes in three
equal installments on March 15, 2037, March 15, 2038, and
March 15, 2039. Jamaica will pay interest on the outstanding
principal of the notes semiannually in arrears on March 15 and
Sept. 15 of each year, commencing on Sept. 15, 2007, at an
annual rate of 8.00%.
Citigroup Global Markets Inc. managed the sale.
The Financial Times says most of the orders came from the United
States and the rest from Europe.
Jamaica's credit rating was affirmed by Standard & Poor's,
citing the country's "commitment to fiscal discipline and debt
reduction." S&P rates the country's long-term debt at B.
===========
M E X I C O
===========
COTT CORP: Revenues Rise to US$400.1 Mil. in 2006 Fourth Quarter
----------------------------------------------------------------
Cott Corp. reported results for the fourth quarter and full year
ended Dec. 30, 2006.
Revenue increased 0.7% in the quarter to US$400.1 million,
compared with US$397.2 million in the fourth quarter of the
prior fiscal year. Excluding the impact of foreign exchange,
revenue declined 1.4% compared with the same period in the prior
year.
Fourth quarter gross margin of 7.5% was impacted by US$12.2
million of accelerated depreciation and amortization relating to
the closure of two U.S. manufacturing plants and Cott's U.K.
resin supplier going into receivership, which resulted in
inventory and other losses of US$9 million. These two items
totaled US$21.2 million in pre-tax costs, or 5.3% of sales. On
an after-tax basis, the impact of these items was US$13.8
million. The fourth quarter gross margin in 2005 was 11.9%.
Net loss for the quarter was US$29.6 million compared with a
loss of US$6.9 million in the fourth quarter of the prior year.
This net loss reflects the charges arising from the supplier
receivership, plant closures, share-based compensation, and
executive transition, amounting to US$50.8 million before tax or
US$32.6 million after taxes. Plant closure charges include
accelerated depreciation and amortization, restructuring, asset
impairment and inventory write-downs.
"Reported earnings were significantly impacted by the planned
plant closures, and by the receivership of our U.K. resin
supplier which was unexpected and highly disappointing.
Excluding these costs, our earnings and fundamental performance
continue to improve," Cott Chief Executive Officer Brent
Willis said.
"The improvement in our business fundamentals in the
fourth quarter of 2006, particularly in cost reduction and core
customer partnerships, is encouraging. We have made good
progress in improving day-to-day operations, discipline and
focus but we still have significant opportunities to improve
execution."
Fourth Quarter Business Unit Highlights
North American revenue declined 3.8% compared with the fourth
quarter of 2005. The decline was due to lower volumes, the
elimination of unprofitable products and lower revenues as
customers were converted from delivered to customer pick-up.
Excluding appreciation in the Canadian dollar, North American
revenue declined 4.3%.
The International business unit posted strong quarterly revenue
gains of 15.6% from base business growth. Excluding the impact
of foreign exchange, International revenue was up 7.4% over the
prior year fourth quarter.
Other Financial Information
Selling, general and administrative expenses increased in the
quarter to US$46.7 million, as compared with US$32 million in
the fourth quarter of 2005, mainly due to stock-based
compensation expense, executive transition costs and incentive
expense. Cott began recording expenses for stock-based
compensation in 2006 under the provisions of FAS 123(R).
Restructuring charges, asset impairments and other charges of
US$29.6 million on a pre-tax basis, or US$18.8 million after
taxes, were recorded in the quarter. This includes charges
related to the previously announced closure of the company's
plants in Elizabethtown and Wyomissing. This amount is part of
the previously announced charges of US$115 million to US$125
million. The fourth quarter operating loss was US$40.3 million
compared with operating income of US$1.8 million in the fourth
quarter of 2005.
Cott is in the process of assessing the effectiveness of its
internal controls over financial reporting in the areas of
procurement, segregation of duties and inventory. It expects to
report material weaknesses in these areas in the company's
annual report on Form 10-K, which is expected to be filed at the
end of February 2007. Cott does not expect these weaknesses to
result in any changes to the company's financial statements for
2006.
Full-Year Results
2006 full-year volume was 1,233.5 million eight-ounce equivalent
cases, up 2.7% from 1,201.4 million in 2005. The volume growth
was driven by the International business unit, including the
contribution from Macaw. 2006 revenues increased 0.9% to
US$1,771.8 million, compared with US$1,755.3 million in the
prior fiscal year. Excluding the acquisition of Macaw, revenue
declined 3.6%. When the impact of foreign exchange is also
excluded, revenue declined 4.8% in 2006 compared with 2005.
Full-year gross margin was 12.2% compared with 14.2% in 2005.
Selling, general and administrative expenses for 2006 were
US$176.1 million, a 27.1% increase over 2005 primarily due to
share-based compensation expense which the company began
recording in 2006, executive transition costs and increased
incentive expense.
Net loss for the year was US$17.5 million compared with income
of US$24.6 million in 2005. This net loss reflects the charges
from plant closures, share-based compensation, executive
transition charges and the inventory loss triggered by the
receivership of Cott's U.K. resin supplier. These charges
totaled US$80.8 million before tax or US$54.5 million after
taxes for the year.
On a business unit basis, full-year North American revenue was
down 6% while International revenue grew 32% in 2006 when
compared with 2005. Excluding the Macaw acquisition,
International revenue grew 7.4% in the year.
Progress in Key Strategic Areas
Cott's strategy for creating and sustaining long-term growth and
profitability is based on three key areas of focus:
1. Lowest cost production
2. Retailers' best partner
3. Innovation pipeline
Cott reported progress in each of these areas:
-- The company's plants in Wyomissing and Elizabethtown shut
down operations ahead of schedule and with no major
disruptions. The closures are expected to result in
US$8 million of cost-savings in 2007 and US$10 million
annually thereafter.
-- The Sub-Zero Based Budgeting process was fully adopted for
the 2007 budget. The company anticipates realizing more
than US$10 million in savings in 2007 as a result of the
SZBB process.
-- Combining all cost reduction programs, including those
items above and previously announced in the second and
third quarters of 2006, Cott expects to deliver a total of
US$35 million in cost reductions for 2007, and spend back
US$15 million of that to support growth initiatives.
-- In core business execution, Cott has aligned annual
displays, features, expanded shelf space, and consumer
promotion calendars with many of its major customers.
These include in-store sampling, product tie-ins,
dedicated promotional displays and flyer promotions taking
place throughout 2007.
-- In new products, the company finalized agreements to
supply sports drinks to one of its top five customers
beginning in the second quarter of 2007. Cott continues
to roll out its portfolio of sports drinks, ready-to-drink
teas, energy drinks, and flavored and enhanced waters, as
part of its expansion of new non-CSD products throughout
North America.
-- Internationally, Cott continued its strategic expansion.
In addition to new supply arrangements in Europe with a
top Five global retailer, Cott also recently aligned with
a top U.K. retailer to supply a range of high quality
beverages to its portfolio. The company also progressed
its relationships with business partners in China. Cott
expects to launch both retailer brands and RC Cola
beginning in the second quarter of 2007.
Summary & Outlook
"In the second half of 2006, we made a number of changes
necessary to rebuild our business foundation which we expect
will deliver solid results in 2007. We took actions to remove
millions of dollars in costs from the business, eliminated
hundreds of positions, restructured and refocused the
organization, and re-oriented top-line drivers to renew volume
and revenue growth," Mr. Willis added.
"We said we would take significant costs out of the business and
we have -- but there is a lot more that we can and will do.
We've made good early progress in new channels, new products,
and new customers, especially internationally. These new
initiatives and expansions take time to contribute, but we
expect them to positively impact the business in 2007. We said
top-line would take at least until the beginning of the year to
turn-around and we are now seeing the initial signs of
improvement and a fast start to the new year."
Cott announced its business model for growth with anticipated
financial targets of:
-- Long-term annual organic volume growth of 2-4%;
-- Long-term annual organic revenue growth of 3-5%;
-- Gross margin improvement of 50 - 100 basis points
year-on-year, exceeding 16% in 2009;
-- Long-term annual operating income growth of 12-15%; and
-- Annual capital expenditures of US$50-70 million.
"The top and bottom line opportunities for the company are
considerable and we believe we are well positioned to drive
strong multi-year performance. Given the industry unknowns in
2007, we expect volume and revenue growth to be on the lower
end, but profit growth to be on the upper end of the company's
long-term targets, as performance recovers from 2006."
Headquartered in Toronto, Ontario, Canada, Cott Corp.
(NYSE:COT; TSX:BCB) -- http://www.cott.com/-- is a non-
alcoholic beverage company and a retailer brand beverage
supplier. The Company commercializes its business in over 60
countries worldwide, with its principal markets being the United
States, Canada, the United Kingdom and Mexico. Cott markets or
supplies over 200 retailer and licensed brands, and Company-
owned brands including Cott, Royal Crown, Vintage, Vess and So
Clear. Its products include carbonated soft drinks, sparkling
and flavored mineral waters, energy drinks, juices, juice
drinks and smoothies, ready-to-drink teas, and other non-
carbonated beverages.
As reported in the Troubled Company Reporter-Latin America on
Feb. 6, 2007, Standard & Poor's Ratings Services lowered its
ratings on Toronto-based private label soft drink manufacturer
Cott Corp., by one notch, including its long-term corporate
credit rating, to 'B+' from 'BB-'. S&P said the outlook is
negative.
COTT CORP: Names Juan Figuereo as Chief Financial Officer
---------------------------------------------------------
Cott Corporation has appointed Juan R. Figuereo as its new Chief
Financial Officer.
Mr. Figuereo joins Cott on March 26, 2007, from Wal-Mart
International, where he has held the position of Vice President,
Mergers & Acquisitions since 2003. In this role, he provided
leadership to Wal-Mart's international growth strategy through
acquisitions, partnerships and joint ventures in global markets.
Prior to joining Wal-Mart, Mr. Figuereo spent 15 years with
PepsiCo in a variety of international finance and general
management roles, first within the Pepsi-Cola organization and
then in the Frito Lay business. He held Chief Financial Officer
roles for Frito Lay in Southern Europe, and Pepsi-Cola in Brazil
and Latin America. He also spent three years as Managing
Director of Frito Lay Dominicana, where he was responsible for
the full scope of business operations in the Caribbean.
"Juan's extensive global experience and his hands-on leadership
of financial turnarounds is a perfect fit for Cott at this stage
in our Company's evolution," commented Brent Willis, Cott's
Chief Executive Officer. "His in-depth knowledge of the
beverage industry and retail environments will be extremely
valuable in driving profitability in our core North American
business and his track record of global success is a great fit
with our future growth opportunities. We're extremely pleased
that Juan is joining our team and I am confident that he will
quickly make a significant contribution to our priorities of
cost reduction, retailer partnerships, innovation and building a
high-performance, winning team."
"I also want to thank Tina Dell'Aquila for her stewardship as
the Company's interim CFO," added Mr. Willis. "She has been an
important resource and will continue to be a valuable member of
Cott's leadership team."
Mr. Figuereo holds a Bachelor of Business Administration in
Public Accounting from Florida International University and he
completed the Financial Management Program at the University of
London in England. He is a Certified Public Accountant and
fluent in English, Spanish and Portuguese.
Headquartered in Toronto, Ontario, Canada, Cott Corp.
(NYSE:COT; TSX:BCB) -- http://www.cott.com/-- is a non-
alcoholic beverage company and a retailer brand beverage
supplier. The Company commercializes its business in over 60
countries worldwide, with its principal markets being the United
States, Canada, the United Kingdom and Mexico. Cott markets or
supplies over 200 retailer and licensed brands, and Company-
owned brands including Cott, Royal Crown, Vintage, Vess and So
Clear. Its products include carbonated soft drinks, sparkling
and flavored mineral waters, energy drinks, juices, juice
drinks and smoothies, ready-to-drink teas, and other non-
carbonated beverages.
As reported in the Troubled Company Reporter-Latin America on
Feb. 6, 2007, Standard & Poor's Ratings Services lowered its
ratings on Toronto-based private label soft drink manufacturer
Cott Corp., by one notch, including its long-term corporate
credit rating, to 'B+' from 'BB-'. S&P said the outlook is
negative.
DAIMLERCHRYSLER AG: Shareholders Want Chrysler Deal Investigated
----------------------------------------------------------------
DaimlerChrysler AG shareholders Ekkehard Wenger and Leonhard
Knoll are calling for special audits that could lead to damage
claims against the company's supervisory board, in a new sign of
friction between investors and management of the German-U.S. car
maker, Matthias Krust at The Wall Street Journal reports.
The two investors, the Journal says, have succeeded in amending
the agenda of the company's April 4 annual shareholders meeting
to include a motion that, if successful, would require an audit
of the 1998 takeover of the former Chrysler Corp. by the former
Daimler-Benz AG.
According to the report, Messrs. Wenger and Knoll say company
officials did not calculate the companies' value correctly and
that DaimlerChrysler management added a 30% premium to the
market value of the Chrysler shares when determining the
exchange ratio used for the merger of both companies.
In response, DaimlerChrysler said in a statement cited by the
Journal that there is no reason for the requested
investigations.
As reported in the Troubled Company Reporter on March 8, 2007,
the Journal said that DaimlerChrysler Chief Executive Officer
Dieter Zetsche confirmed his company is talking to General
Motors Corp. about sharing the costs of future sport-utility
vehicles, but he and GM's CEO stayed mum about whether GM could
try to buy its Chrysler arm outright.
According to that report, Mr. Zetsche reiterated that the auto
maker is considering "all options" for Chrysler, including a
possible sale, which move came amid rising investor frustration
over the division's losses.
Lower February Sales
As reported in the Troubled Company Reporter on Mar. 2, 2007,
DaimlerChrysler AG's Chrysler Group reported sales for February
2007 of 174,506 units; down 8% compared with February 2006 with
190,367 units. All sales figures are reported unadjusted.
"In a generally soft market environment in February, the
Chrysler Group had good traffic and solid customer interest
especially for our newly launched, fuel efficient models like
the Dodge Avenger, Dodge Caliber, and Jeep(R) Compass. Also,
the Jeep Wrangler had its best February ever," Chrysler Group
Vice President for Sales and Field Operations Steven Landry
said.
About DaimlerChrysler
Headquartered in Stuttgart, Germany, DaimlerChrysler AG --
http://www.daimlerchrysler.com/-- develops, manufactures,
distributes, and sells various automotive products, primarily
passenger cars, light trucks, and commercial vehicles worldwide.
It primarily operates in four segments: Mercedes Car Group,
Chrysler Group, Commercial Vehicles, and Financial Services.
The company's worldwide locations are located in: Canada,
Mexico, United States, Argentina, Brazil, Venezuela, China,
India, Indonesia, Japan, Thailand, Vietnam and Australia.
The Chrysler Group segment offers cars and minivans, pick-up
trucks, sport utility vehicles, and vans under the Chrysler,
Jeep, and Dodge brand names. It also sells parts and
accessories under the MOPAR brand.
The Chrysler Group is facing a difficult market environment in
the United States with excess inventory, non-competitive legacy
costs for employees and retirees, continuing high fuel prices
and a stronger shift in demand toward smaller vehicles. At the
same time, key competitors have further increased margin and
volume pressures -- particularly on light trucks -- by making
significant price concessions. In addition, increased interest
rates caused higher sales & marketing expenses.
In order to improve the earnings situation of the Chrysler Group
as quickly and comprehensively, measures to increase sales and
cut costs in the short term are being examined at all stages of
the value chain, in addition to structural changes being
reviewed as well.
DAIMLERCHRYSLER AG: Sells EUR2 Bil. 4.375% Bonds Due March 2010
---------------------------------------------------------------
DaimlerChrysler AG sold EUR2 billion of 4.375% bonds due March
2010 at a yield premium or a spread of 35 basis points over the
mid-swaps rate, the Budapest Business Journal reports citing
Bloomberg as its source.
Investors earlier demanded the highest risk premiums to hold the
company debt in at least a month after a rise in supreme
mortgage failures.
According to Mahmoud El-Shaer, who helps manage about US$35
billion of fixed-income assets for State Street Investment
Management in London, the market is entering into a more normal
phase following a period of volatility, BBJ relates.
Mr. E-Shaer said speculations that DaimlerChrysler will
successfully find a buyer for its unprofitable Chrysler division
may have also helped boost demand for the bonds.
However, a company spokeswoman refused to disclose details on
how the automobile manufacturer intends to use the proceeds of
the sale.
According to data compiled by Bloomberg, DaimlerChrysler has up
to EUR8.3 billion of bonds maturing this year. Commerzbank AG,
Royal Bank of Scotland Group Plc and UniCredit SpA is managing
the sale of the debt.
The company's bonds reported a gain on Feb. 14 after
DaimlerChrysler CEO Dieter Zetsche disclosed that his company is
keeping all options open, including a sale or possible
partnerships, for its loss-making Chrysler division.
About DaimlerChrysler
Based in Stuttgart, Germany, DaimlerChrysler AG --
http://www.daimlerchrysler.com/-- develops, manufactures,
distributes, and sells various automotive products, primarily
passenger cars, light trucks, and commercial vehicles worldwide.
It primarily operates in four segments: Mercedes Car Group,
Chrysler Group, Commercial Vehicles, and Financial Services.
The company's worldwide operations are located in: Canada,
Mexico, United States, Argentina, Brazil, Venezuela, China,
India, Indonesia, Japan, Thailand, Vietnam and Australia.
The Chrysler Group segment offers cars and minivans, pick-up
trucks, sport utility vehicles, and vans under the Chrysler,
Jeep, and Dodge brand names. It also sells parts and
accessories under the MOPAR brand.
The Chrysler Group is facing a difficult market environment in
the United States with excess inventory, non-competitive legacy
costs for employees and retirees, continuing high fuel prices
and a stronger shift in demand toward smaller vehicles. At the
same time, key competitors have further increased margin and
volume pressures -- particularly on light trucks -- by making
significant price concessions. In addition, increased interest
rates caused higher sales & marketing expenses.
In order to improve the earnings situation of the Chrysler Group
as quickly and comprehensively, measures to increase sales and
cut costs in the short term are being examined at all stages of
the value chain, in addition to structural changes being
reviewed as well.
DOMINO'S PIZZA: Accepts US$30 Per Share Tender Offer
----------------------------------------------------
Domino's Pizza Inc. announced the final results of its modified
"Dutch auction" equity tender offer, which expired at 5:00 p.m.,
Eastern Time, on March 9, 2007. In accordance with the terms
and subject to the conditions of the offer, Domino's Pizza has
accepted for purchase 2,242 shares of its common stock, at a
purchase price of US$30.00 per share, for a total purchase price
of US$67,260. All shares purchased in the tender offer will
receive the same price. Domino's Pizza is pleased with the
results of the tender offer and will continue with its
recapitalization plan as previously disclosed.
Payment for shares accepted for purchase will be made promptly
by American Stock Transfer and Trust Company, the depositary for
the tender offer.
J.P. Morgan Securities Inc., Lehman Brothers Inc. and Merrill
Lynch & Co. acted as dealer managers for the tender offer. The
information agent for the tender offer was MacKenzie Partners,
Inc. The depositary for the offer was American Stock Transfer
and Trust Company. Persons with questions regarding the tender
offer should contact MacKenzie Partners Inc. at (800) 322-2885
(toll free) or (212) 929-5500 (collect).
Headquartered in Ann Arbor, Michigan, Domino's Pizza Inc.
(NYSE: DPZ) -- http://www.dominos.com/-- through its primarily
franchised system, operates a network of 8,190 franchised and
company-owned stores in the United States and more than 50
countries. Founded in 1960, the company has more than 500
stores in Mexico. The Domino's Pizza(R) brand, named a
Megabrand by Advertising Age magazine, had global retail sales
of nearly US$5 billion in 2005, comprised of US$3.3 billion
domestically and US$1.7 billion internationally.
As of Sept. 10, 2006, Domino's Pizza's balance sheet showed a
US$592,435,000 stockholders' deficit compared with a
US$609,112,000 at June 18, 2006.
GENERAL MOTORS: Will Release 2006 Financial Results Today
---------------------------------------------------------
General Motors Corp. has scheduled the release of its 2006
fourth-quarter and calendar year financial results for 7:00 a.m.
EDT, March 14, 2007, via PR Newswire and GM Media Online.
GM Vice Chairman and Chief Financial Officer Fritz Henderson
will conduct a conference call at 9:30 a.m. EDT. A question-
and-answer session with financial analysts and media will follow
a review of the results. The call is expected to last
approximately 120 minutes.
Conference Call Information
* Dial 1-800-266-1824 or 212-896-6043 for international
access.
* The conference call will also be web cast live on GM's
Investor website http://investor.gm.comin the
Calendar/Events section.
* Charts will be posted in the Earnings Release section.
* The web cast and charts will also be available via a hot
link in GM Media Online http://media.gm.com
* Archive: A taped replay of the call will be made available
from 1:00 p.m. EDT March 14, 2007, until 1:00 p.m. EDT
March 16, 2007. Dial 1-800-633-8284 (or 402-977-9140 for
international access) and enter reservation number 21332769
to access the taped replay.
As reported in the Troubled Company Reporter on Mar. 8, 2007,
the automaker pushed back the filing of its Annual Report on
Form 10-K with the U.S. Securities and Exchange Commission after
failing to make the March 1 filing deadline.
According to the company, the delay is due to the issues
regarding the accounting for deferred income tax liabilities and
certain hedging activities under the Statement of Financial
Accounting Standards.
GM also intends to report restated results for the years ended
Dec. 31, 2002, to Dec. 31, 2005, and for the first three
quarters of 2006.
"As disclosed in prior [SEC] filings, the current estimate of
the cumulative impact of the accounting adjustments under SFAS
No. 133 to retained earnings, as of Sept. 30, 2006, is an
increase of approximately US$200 million," the company disclosed
in its SEC filing.
"In addition, GM previously disclosed that retained earnings as
of Dec. 31, 2001, and subsequent periods are understated by a
range of US$450 million to US$600 million due to an
overstatement of deferred tax liabilities. GM currently
estimates that the deferred income tax liability overstatement
is approximately US$1 billion. This impact is partially offset
by an estimated US$500 million adjustment to stockholders'
equity related to taxation of foreign currency translation,
arising primarily prior to 2002, and affects all periods through
the third quarter of 2006. The estimate net effect of such tax
adjustments results in an understatement of stockholders' equity
as of Dec. 31, 2001, and subsequent periods of approximately
US$500 million," the company said.
About General Motors Corp.
General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- is the
world's largest automaker and has been the global industry sales
leader since 1931. Founded in 1908, GM employs about 284,000
people around the world. It has manufacturing operations in
33 countries including Belgium, France, Germany, India, Mexico,
and its vehicles are sold in 200 countries. GM sells cars and
trucks under these brands: Buick, Cadillac, Chevrolet, GMC, GM
Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, and
Vauxhall.
* * *
As reported in the Troubled Company Reporter on Dec. 15, 2006,
Standard & Poor's Ratings Services affirmed its 'B' corporate
credit rating and other ratings on General Motors Corp. and
removed them from CreditWatch with negative implications, where
they were placed March 29, 2006. S&P said the outlook is
negative.
As reported in the Troubled Company Reporter on Nov. 14, 2006,
Moody's Investors Service assigned a Ba3, LGD1, 9% rating to the
US$1.5 billion secured term loan of General Motors Corp.
GENERAL MOTORS: May Incur US$1B Charge from Bad Mortgage Loans
--------------------------------------------------------------
General Motors Corp. may take a charge of almost US$1 billion to
cover bad mortgage loans made by its former home-lending unit,
Greg Bensinger at Bloomberg News reports, citing a Lehman
Brothers Holdings Inc. analyst.
According to the report, the company in November sold a 51%
stake in General Motors Acceptance Corp. for US$14.4 billion to
a group led by Cerberus Capital Management LP.
Residential Capital LLC, a part of GMAC, relies on loans to
people with poor or limited credit records or high debt burdens,
for more than three-quarters, or US$57 billion, of its loan
portfolio, Bloomberg says, citing a research report by Lehman
analyst Brian Johnson. Delinquency rates on such subprime loans
made last year are at a record high, the report added.
The subprime market is "a key factor to see what the earnings
power of GM's remaining interest in GMAC is going to be," Mr.
Johnson said in an interview with Bloomberg.
Mr. Johnson told Bloomberg last month that GM may have to spend
as much as US$950 million to make up the difference between the
original value of the finance unit and any losses for subprime
loans made by ResCap.
GM spokeswoman Renee Rashid-Merem and GMAC spokeswoman Toni
Simonetti both declined to comment on analysts' estimates for
the automaker's subprime mortgage exposure, Bloomberg said.
Possible Chrysler Tie-Up
DaimlerChrysler AG Chief Executive Officer Dieter Zetsche
confirmed last week his company is talking to General Motors
about sharing the costs of future sport-utility vehicles, but he
and GM's CEO stayed mum about whether GM could try to buy its
Chrysler arm outright, Stephen Power and Neal E. Boudette of the
Wall Street Journal reported.
According to the source, Mr. Zetsche reiterated that the auto
maker is considering "all options" for Chrysler, including a
possible sale, which move came amid rising investor frustration
over the division's losses.
As reported in the Troubled Company Reporter on Mar. 8, 2007,
General Motors Chief Executive Rick Wagoner said he does not
expect a consolidation in the U.S. auto industry in the near
term despite the intense pressures from fierce competition and
excess production capacity, Neal E. Boudette and Stephen Power
of The Wall Street Journal reported.
The U.S. auto industry has enough plants to produce more
vehicles than it sells for at least 10 years, the Journal said,
citing Mr. Wagoner as saying in an interview.
Reuters' Kevin Krolicki cited Mr. Wagoner's previous statement
that escalating costs would mean more industry alliances and
mergers.
Reuters said in that report that according to Mr. Wagoner, the
costs of developing the next generation of automobiles,
especially the replacement for the traditional internal
combustion engine, meant that the industry would be driven
toward deeper collaboration.
GM is open to tie-ups with other automakers to develop an all-
electric car like the Chevrolet Volt concept that GM unveiled in
January, Mr. Wagoner said, as cited by Reuters.
Higher February U.S. Sales
Despite an expected 6 to 7% decline in its U.S. industry sales,
the automaker reported a 3.4% total sales increase last month,
due to an 11% retail sales increase.
The company lowered its sales forecast for last month following
its decision to reduce sales to daily rental fleets.
As reported in the Troubled Company Reporter on Mar. 1, 2007, GM
reduced discounted fleet sales with the prospect of returning
to profitability in North America. The move, according to
analysts, allowed the automaker to keep its assembly plants
running but eroded the value of its brands.
According to Reuters, GM planned to cut its daily rental sales
more than 200,000 units this year after a reduction of about
77,000 units in 2006. The planned cuts would take GM's annual
rental-related sales below 700,000 units by the end of 2008 from
more than 1 million before the effort began.
About General Motors Corp.
General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- is the
world's largest automaker and has been the global industry sales
leader since 1931. Founded in 1908, GM employs about 284,000
people around the world. It has manufacturing operations in
33 countries including Belgium, France, Germany, India, Mexico,
and its vehicles are sold in 200 countries. GM sells cars and
trucks under these brands: Buick, Cadillac, Chevrolet, GMC, GM
Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn, and
Vauxhall.
* * *
As reported in the Troubled Company Reporter on Dec. 15, 2006,
Standard & Poor's Ratings Services affirmed its 'B' corporate
credit rating and other ratings on General Motors Corp. and
removed them from CreditWatch with negative implications, where
they were placed March 29, 2006. S&P said the outlook is
negative.
As reported in the Troubled Company Reporter on Nov. 14, 2006,
Moody's Investors Service assigned a Ba3, LGD1, 9% rating to the
US$1.5 billion secured term loan of General Motors Corp.
INTERNATIONAL RECTIFIER: Fitch Ups Debt Rating One Notch to BB+
---------------------------------------------------------------
Fitch Ratings has upgraded International Rectifier Corp.'s
(NYSE: IRF) ratings as:
-- Issuer Default Rating to 'BB' from 'BB-';
-- Senior Secured Bank Credit Facility Rating 'BB+' from
'BB';
-- Subordinated Debt Rating to 'BB-' from 'B+'.
The rating outlook remains positive.
The rating upgrades and outlook reflect:
i) IR's strengthened operating profile, pro forma for the
anticipated April 1, 2007, divestiture of the company's
lower margin and comparatively volatile Power Controls
Systems business, representing approximately 25% of IR's
current revenue base;
ii) Fitch's expectations that, despite slowing albeit still
positive personal computer and cell phone unit growth
over the next few years, IR's growth rate will exceed
that of the semiconductor market and exhibit less
operating volatility than historically, due to a
combination of increased power management content per
device/product and the ongoing conversion to digital
from mechanical;
iii) rational capacity additions over the past few years, as
well as more flexible capacity related to the company's
new foundry relationship with Tower Semiconductor, which
should result in more consistent utilization rates
through the intermediate-term;
iv) relatively diversified product and end market
portfolios, with no significant customer concentration;
and
v) increased net cash position upon receiving US$290
million in gross proceeds from the divestiture.
Fitch believes further positive rating action could occur if IR:
i) achieves growth consistently above the broader market;
ii) meaningfully increases the mix of energy savings and
Aerospace & Defense revenues, both of which are
characterized by longer product life-cycles;
iii) sustains gross and operating margins approaching 50% and
25%, respectively;
iv) generates consistently positive free cash flow while
maintaining capital spending discipline; and
v) sustains a net cash position.
Ratings concerns mainly center on IR's ongoing significant
investments in research and development and capital equipment,
which Fitch believes will continue to approximate 25% of
revenues, consistent with peers. Over the next two years,
however, Fitch anticipates heightened capital intensity for the
company, as it continues expanding manufacturing capacity.
Nonetheless, Fitch believes IR would be challenged to
meaningfully curtail R&D and capital spending more than
temporarily without jeopardizing key customer relationships and
leading positions in several power management markets.
Concerns also include:
i) IR's historically modest although positive annual free
cash flow;
ii) higher concentration to the computing and communications
segment, pro forma for the divestiture, two end markets
characterized by shorter product life-cycles and
technology risk; and
iii) small size relative to the majority of its competitors,
many of whom are large integrated semiconductor makers
with more diversified revenue portfolios and greater
financial resources, which Fitch believes will provide
greater financial flexibility through future
semiconductor cycles.
Although the pending divestiture modestly reduces the company's
revenue diversification, Fitch believes IR's pro forma revenue
portfolio will be higher mix and less volatile than
historically. IR's Focus Products businesses, excluding
intellectual property licensing revenues (the patents for which
expire over the near-term and are largely related to the PCS
business), represented approximately 75% of consolidated
revenues including the non-aligned product segment, which was
reclassified as discontinued operations as of Dec. 31, 2006, but
89% of consolidated gross margins for the latest 12 months ended
Dec. 31, 2006. Given solid order growth and positive demand
trends for power management, Fitch believes IR's revenue growth
will exceed 3 times world-wide gross domestic product over the
next few years and could be slightly higher than annual
semiconductor industry growth. At the same time, Fitch
estimates IR's gross margins will be above 45% post divestiture
through a moderate cycle (versus 40% 3 years ago) and operating
margin, which Fitch estimates was just less than 15% for the LTM
ended Dec. 31, 2006, above 20%. Demand visibility should also
improve, due to the company's earlier and increased design and
engineering collaboration with customers, which should enable
the company to more effectively manage production schedules and
supply additions and, therefore, maintain more consistent
utilization rates.
As of Dec. 31, 2006, Fitch believes IR's liquidity position was
solid and supported by:
i) approximately US$1.1 billion of cash and cash
equivalents, including investments in securities with
long-term maturities, and
ii) a US$150 million undrawn senior secured revolving credit
facility expiring 2011.
The anticipated US$290 million of gross proceeds from the PCS
divestiture also will bolster the company's liquidity position.
Fitch believes annual free cash flow will be limited over the
next two years, due to heightened capital spending, but likely
increase to US$50-US$100 million by fiscal year 2009. As of
Dec. 31, 2006, total debt consisted of the US$550 million 4.25%
convertible subordinated notes due July 2007, and approximately
US$88 million of foreign bank loans. Rather than refinancing
its debt, Fitch believes IR is likely to use net proceeds
received from the divestiture and current cash balances to meet
the upcoming maturity of the aforementioned convertible notes.
IR expects to close the sale of its PCS businesses, which
include commodity product and non-aligned product segments to
Vishay Intertechnologies for approximately US$290 million on
April 1, 2007. Pro forma for the divestiture, excluding the
license fees from intellectual property, the key patents for
which significantly expire by fiscal year 2008 and 2009, IR's
end market portfolio will consist of: communications and
computing, energy savings products, and aerospace and defense,
respectively representing approximately 51%, 33%, and 16% of pro
forma revenues. In connection with the divestiture, IR also
will provide foundry and certain other services to Vishay for up
to three years, the revenues from which Fitch believes will be
modest and less profitable.
Headquartered in El Segundo, Calif., International Rectifier
-- http://www.irf.com/-- provides enabling technologies for
products that work smarter, run cooler, and raise the world's
productivity-per-watt. It has manufacturing facilities in the
U.S., Mexico, United Kingdom, Germany and Italy; and has
subsidiaries in Japan and Singapore.
MERIDIAN AUTOMOTIVE: Trustee Wants Beneficiary Record Date Fixed
----------------------------------------------------------------
Ocean Ridge Capital Advisors, LLC, the litigation trustee
appointed pursuant to the Debtors' confirmed plan of
reorganization, asks the Honorable Mary F. Walrath of the U.S.
Bankruptcy Court for the District of Delaware to fix a record
date for identifying:
(a) Prepetition First Lien Claim Beneficiaries,
(b) Prepetition Second Lien Claim Beneficiaries, and
(c) Prepetition General Unsecured Claim Beneficiaries.
Pursuant to the Trust Agreement:
-- Prepetition First Lien Claim Beneficiaries means Holders,
as of the Effective Date, of the Prepetition First Lien
Claim Trust Interests;
-- Prepetition General Unsecured Claim Beneficiaries means
Holders of General Unsecured Claims as of the Distribution
Record Date, to the extent the Claims are Allowed Claims;
and
-- Prepetition Second Lien Claim Beneficiaries means Holders,
as of the Effective Date, of the Prepetition Second Lien
Claim Trust Interests.
The Litigation Trustee explains that the "Defined Terms" section
of the Debtors' Plan establishes the Distribution Record Date as
the date of the entry of the order confirming the Plan --
Dec. 6, 2006.
The Litigation Trustee, however, points out that pursuant to the
"Notice of (I) Entry of Order Confirming the Fourth Amended
Joint Plan of Reorganization Proposed by the Debtors; (II) the
Bar Date for Certain Administrative Claims; and (III) the
Occurrence of the Effective Date of the Plan" the Debtors filed
on Jan. 8, 2007, the Effective Date is Dec. 29, 2006.
Given the provisions of the Trust Agreement that prohibit the
transfer of beneficial interests in or rights to payments to be
made under the Trust Agreement, the Litigation Trustee says, it
appears that the fixed record dates for the identification of
Trust beneficiaries are:
(a) Dec. 29, 2006 -- the Effective Date -- for Prepetition
First Lien Claims and Prepetition Second Lien Claims; and
(b) Dec. 6, 2006 -- the Distribution Record Date -- for
Prepetition General Unsecured Claims, to the extent that
the Prepetition General Unsecured Claims are allowed
claims.
The Litigation Trustee also notes that the Trust Agreement
contains a subsection titled "Identification of Prepetition
General Unsecured Claim Beneficiaries," which requires the
Debtors to promptly deliver to the Litigation Trustee a Claims
Report showing claims as of the Distribution Record Date, and to
provide updated Claims Reports to the Litigation Trustee
periodically. The Litigation Trustee notes it is authorized to
rely on the Claims Reports for purposes of making distributions
to Prepetition General Unsecured Claim Beneficiaries.
Given that the Plan and the Trust Agreement contemplate that
Prepetition General Unsecured Claims may be disputed as of the
Distribution Record Date, and that holders of disputed
Prepetition General Unsecured Claims are not Trust
beneficiaries, the purpose of the subsequent Claims Reports is
presumably to inform the Litigation Trustee of new Prepetition
General Unsecured Claim Beneficiaries.
To the extent that any disputed Prepetition General Unsecured
Claims become allowed in whole or in part after the Distribution
Record Date, the holders of the allowed claims will become Trust
Beneficiaries and are entitled to distributions as and to the
extent provided in the Plan and the Trust Agreement, the
Liquidation Trustee tells the Court.
In addition, the Trust Agreement indicates that the Litigation
Trustee may rely on the Claims Reports for the addresses of the
Prepetition General Unsecured Claim Beneficiaries.
Prepetition First Lien Claim Beneficiaries and Prepetition
Second Lien Claim Beneficiaries are permitted to send written
notice of changes of address directly to the Litigation Trustee,
but the Trust Agreement contains no provision with respect to
Prepetition General Unsecured Claim Beneficiaries, the
Litigation Trustee adds.
The Litigation Trustee asks Judge Walrath to clarify that:
-- the fixed record date for identifying Prepetition First
Lien Claim Beneficiaries and Prepetition Second Lien Claim
Beneficiaries is Dec. 29, 2006, the Plan Effective
Date;
-- the fixed record date for identifying Prepetition General
Unsecured Claim Beneficiaries is Dec. 6, 2006, the
Distribution Record Date, for those holders of Prepetition
General Unsecured Claims whose claims are allowed as of
Dec. 6, 2006;
-- the Litigation Trustee is authorized to rely on the Claims
Reports provided to it by the Debtors for the addresses of
Prepetition General Unsecured Claim Beneficiaries, for the
dollar amount of the claim of each Prepetition General
Unsecured Claim, and for information concerning
Prepetition General Unsecured Claims that are disputed as
of the Distribution Record Date and are subsequently
allowed in whole or in part; and
-- the Litigation Trustee is authorized to recognize as Trust
Beneficiaries and make distributions solely to:
(a) holders of Prepetition First Lien Claims and
Prepetition Second Lien Claims as of Dec. 29, 2006;
(b) holders of allowed Prepetition General Unsecured
Claims as of Dec. 6, 2006; and
(c) holders of Prepetition General Unsecured Claims that
are allowed after Dec. 6, 2006, to the extent the
allowance is reflected in the Claims Reports provided
to the Trustee and consistent with the Plan and the
Trust Agreement.
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.
Judge Walrath confirmed the Revised Fourth Amended
Reorganization Plan of Meridian and that plan became effective
on Dec. 29, 2006. (Meridian Bankruptcy News, Issue No. 50;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
MERIDIAN AUTOMOTIVE: EPA Wants US$9MM in Clean Air Act Penalties
----------------------------------------------------------------
The United States Environmental Protection Agency asks the U.S.
Bankruptcy Court for the District of Delaware to compel Meridian
Automotive Systems Inc. and its affiliates to pay civil
penalties for violation under the Clean Air Act.
Matthew McKeown, Esq., Trial Attorney, Environmental Enforcement
Section of Environment and Natural Resources Division of the
U.S. Department of Justice, in Washington D.C., states that
civil penalties for those violations qualify as administrative
expenses under Section 503 of the Bankruptcy Code.
From April 26, 2005, until May 24, 2006, volatile organic
compound emissions from a Sheet Molding Machine at the Debtors'
plant in Jackson, Ohio, exceeded the hourly, daily, and yearly
limitations set forth in the Permit to Install and the Title V
permit the Debtors obtained.
Mr. McKeown says that the Debtors are liable for civil penalties
of up to US$32,500 per day -- for 279 days -- for each of the
violations. Accordingly, the statutory maximum in civil
penalties for which the Debtors may be liable for each violation
is roughly US$9,000,000.
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.
Judge Walrath confirmed the Revised Fourth Amended
Reorganization Plan of Meridian and that plan became effective
on Dec. 29, 2006. (Meridian Bankruptcy News, Issue No. 50;
Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
US STEEL: CEO Accepts China's Plan to Close Plants a "Good Step"
----------------------------------------------------------------
U.S. Steel Corp. CEO John Surma said that the U.S. steel
industry remains concerned about a rapid rise in imports from
China, but welcomes the Chinese government's announcement that
it will close 35 million tons of crude steel production
capacity, Doug Palmer of Reuters reports.
"That would be a very good step," Mr. Surma said, as cited by
the source.
According to the report, the steel closure targets are part of a
plan to reduce pig iron capacity at outdated facilities by 100
million tons and outdated steel capacity by 55 million tones in
the five years from 2006 and 2010.
The report said China has increased its steel production rapidly
in recent years, straining trade ties with the United States and
other steel producers as it has shifted from a net importer to a
substantial net exporter.
Reuters relates that U.S. steel producers are pushing for a
change in U.S. trade remedy laws to allow the United States to
impose countervailing duties on imports from China to offset
what they believe to be extensive government subsidies.
About U.S. Steel
Headquartered in Pittsburgh, Pa., United States Steel
Corporation, (NYSE: X) -- http://www.ussteel.com/--
manufactures a wide variety of steel sheet, tubular and tin
products; coke, and taconite pellets; and has a worldwide annual
raw steel capability of 26.8 million net tons. U. S. Steel's
domestic primary steel operations are: Gary Works in Gary, Ind.;
Great Lakes Works in Ecorse and River Rouge, Mich.; Mon Valley
Works, which includes the Edgar Thomson and Irvin plants, near
Pittsburgh and Fairless Works near Philadelphia, Pa.; Granite
City Works in Granite City, Ill.; Fairfield Works near
Birmingham, Ala.; Midwest Plant in Portage, Ind.; and East
Chicago Tin in East Chicago, Ind. The company also operates two
seamless tubular mills, Lorain Tubular Operations in Lorain,
Ohio; and Fairfield Tubular Operations near Birmingham, Ala.
U. S. Steel produces coke at Clairton Works near Pittsburgh, at
Gary Works and Granite City Works. On Northern Minnesota's
Mesabi Iron Range, U. S. Steel's iron ore mining and taconite
pellet operations, Minnesota Taconite (Minntac) and Keewatin
Taconite (Keetac), support the steelmaking effort, and its
subsidiary ProCoil Company provides steel distribution and
processing services.
Internationally, U.S. Steel has steelmaking subsidiaries in
Kosice, Slovakia (U.S. Steel Kosice, s.r.o.), and in Sabac and
Smederevo, Serbia (U.S. Steel Serbia, d.o.).
In addition to primary steel operations, U. S. Steel
participates in several joint ventures: USS-POSCO Industries,
Pittsburg, Ca.; PRO-TEC Coating Company, Leipsic, Ohio;
Worthington Specialty Processing, Jackson, Mich.; Double Eagle
Steel Coating Company, Dearborn, Mich.; Double G Coating
Company, Jackson, Miss.; and Acero Prime, San Luis Potosi,
Mexico.
U. S. Steel is also involved in a number of other businesses,
among them transportation (Transtar, Inc.), real estate
development, and leasing and financial services.
* * *
As reported in the Troubled Company Reporter on Mar. 1, Moody's
Investors Service upgraded United States Steel's senior
unsecured ratings to Baa3 from Ba1. At the same time Moody's
withdrew US Steel's Ba1 corporate family rating, its Ba1
probability of default rating, and its SGL-1 speculative grade
liquidity rating. The rating outlook is stable.
As reported in the Troubled Company Reporter on Jan. 19,
Standard & Poor's Ratings Service raised its corporate credit
rating on Pittsburgh, Pennsylvania-based United States Steel
Corp to 'BB+' from 'BB' and removed all ratings from
CreditWatch, where they had been placed with positive
implications on July 27, 2006. At the same time, Standard &
Poor's raised its rating on the company's senior unsecured debt
to 'BB+' from 'BB'. S&P said the outlook is stable.
VISTEON CORP: Posts US$163 Million Net Loss in Full-Year 2006
-------------------------------------------------------------
Visteon Corp. has filed its 2006 annual financial statements on
Form 10-K with the U.S. Securities and Exchange Commission.
The company reported total net sales of US$11.41 billion for
full-year 2006, including product sales of US$10.87 billion and
services sales of US$547 million. It reported total net sales
of US$16.97 billion for full year 2005.
Visteon's net loss of US$163 million for full year 2006
represents an improvement of US$107 million over 2005's net loss
of US$270 million despite lower sales levels.
Contractual obligations as of Dec. 31, 2006 were US$4.87
billion. The Company has guaranteed approximately US$77 million
of debt capacity held by subsidiaries, and US$97 million for
lifetime lease payments held by consolidated subsidiaries.
In addition, the Company has guaranteed Tier 2 suppliers' debt
and lease obligations and other third-party service providers'
obligations of up to US$17 million at Dec. 31, 2006, to ensure
the continued supply of essential parts.
Visteon's balance sheet at Dec. 31, 2006, reflects total assets
of US$6.93 billion and total liabilities of US$7.12 billion,
resulting in a total shareholders' deficit of US$188 million.
The company's total shareholders' deficit as of Dec. 31, 2005,
stood at US$48 million.
As of Dec. 31, 2006, the company's cash and cash equivalents
were US$1.05 billion, as compared with US$865 million a year
earlier.
A full-text copy of the company's annual report is available for
free at http://ResearchArchives.com/t/s?1af1
About Visteon Corp.
Headquartered in Van Buren Township, Mich., Visteon Corp.
(NYSE: VC) -- http://www.visteon.com/-- is a global automotive
supplier that designs, engineers and manufactures innovative
climate, interior, electronic, and lighting products for vehicle
manufacturers, and also provides a range of products and
services to aftermarket customers. With corporate offices in
the Michigan (U.S.); Shanghai, China; and Kerpen, Germany; the
company has more than 170 facilities in 24 countries, including
Mexico, and employs approximately 50,000 people.
* * *
As reported in the Troubled Company Reporter on Dec. 5, 2006,
Standard & Poor's Ratings Services affirmed its bank loan and
recovery ratings on auto supplier Visteon Corp.'s senior secured
bank facility, following the announcement that the company will
increase its term loan to US$1 billion from US$800 million.
The secured loan rating is 'B' and the recovery rating is '2',
indicating the expectation for substantial (80%-100%) recovery
of principal in the event of a payment default.
As reported in the Troubled Company Reporter on Nov. 24, 2006,
Moody's Investors Service has downgraded Visteon Corporation's
Corporate Family Rating to B3 from B2, changed the ratings
outlook to stable from under review for possible downgrade and
affirmed the company's liquidity rating of SGL-3.
* MEXICO: Local Exchange May Conduct IPO in October
---------------------------------------------------
Bolsa Mexicana de Valores, Mexico's stock exchange, may sell its
own shares in an initial public offering in October, Reuters
reports, citing the exchange's president, Guillermo Prieto. The
president didn't say how much shares will be sold.
According to Reuters, the exchange approved in November 2006, a
plan to reorganize the company, which is owned by major market
participants, with the goal of listing its shares.
The exchange's shareholders are more than 30 brokerages that
trade stock and debt in the market. Each brokerage holds one
share in the company, Reuters says.
Reuters relates the Mexican stock market has allied itself with
other exchanges to increase its futures, options and other
derivative tradings.
Stock exchange executives in Mexico have told Reuters their goal
is to make the exchange a one-stop shop for local investors
interested in buying local or foreign securities.
A law in Mexico was passed in 2005, allowing the stock market to
go public, Reuters says.
* * *
As reported in the Troubled Company Reporter on April 17, 2006,
Standard & Poor's Ratings Services placed an mxBB+ long-term
rating with stable outlook on the state of Mexico.
===========
P A N A M A
===========
CHIQUITA BRANDS: Names Vanessa Vargas-Land as Vice President
------------------------------------------------------------
Chiquita Brands International has appointed Vanessa L.
Vargas-Land as its vice president and chief compliance officer.
In this role, she will be responsible for the day-to-day
operation of the company's compliance and ethics program.
"Vanessa's strong background in ethics and compliance in a
complex international environment will be a tremendous asset in
helping us to achieve the high standards of our Code of Conduct
and Core Values, as well as fully comply with the law and
regulations in the many countries in which Chiquita operates,"
said James Thompson, senior vice president and general counsel.
Mrs. Vargas will report to Thompson, but she will have a close
working relationship with Fernando Aguirre, chairman and chief
executive officer. In addition, she will collaborate closely
with the company's corporate responsibility officer and the
Audit and Nominating & Governance Committees of the Board of
Directors.
"Chiquita is a great company with an already strong legal team
and culture of ethical responsibility," Mrs. Vargas said. "I am
looking forward to adding my skills and experience to maintain
and enhance the company's commitment to the highest standards of
compliance."
Mrs. Vargas comes to Chiquita from Abbott Laboratories. Most
recently, she served as ethics and compliance officer for the
company's nutrition division. Prior to that, she developed and
implemented the compliance program for Abbott's affiliate
business units, located in 59 countries outside of the United
States. While at Abbott, she developed and led multiple training
initiatives regarding ethics and compliance. Mrs. Vargas joined
Abbott in 2000 as litigation counsel.
Prior to joining Abbott, she worked with two Chicago law firms,
managing general business and commercial litigation, as well as
serving as trial lawyer on a broad range of issues. Mrs. Vargas
earned her juris doctor degree and received her bachelor's
degree in English from the University of Illinois, Urbana-
Champaign.
Cincinnati, Ohio- based Chiquita Brands International, Inc.
(NYSE: CQB) -- http://www.chiquita.com/-- operates as an
international marketer and distributor of bananas and other
fresh produce sold under the Chiquita and other brand names in
over 70 countries including Panama, Philippines, Australia,
Belgium, Germany, among others. It also distributes and markets
fresh-cut fruit and other branded, value-added fruit products.
Moody's Investors Service downgraded the ratings for Chiquita
Brands L.L.C., as well as for its parent Chiquita Brands
International, Inc. Moody's said the outlook on all ratings is
stable.
Standard & Poor's Ratings Services also lowered its ratings on
Cincinnati, Ohio-based Chiquita Brands International Inc.,
including its corporate credit rating, from 'B+' to 'B'.
=======
P E R U
=======
CHARLES RIVER: Incurs US$55.7 Mln Net Loss in Year Ended Dec. 31
----------------------------------------------------------------
Charles River Laboratories International, Inc., reported net
loss of US$55.78 million for the fiscal year ended
Dec. 31, 2006, compared with net income of US$141.99 million for
the fiscal year ended Dec. 31, 2005. It generated total net
sales of US$1.05 billion and US$993.32 million for the years
ended Dec. 31, 2006, and 2005, respectively.
The 2006 annual loss was largely due to the loss from
discontinued businesses, net of tax, which totaled US$181
million. The company posted an operating income of US$188.17
million in 2006, as compared with US$184.69 million in 2005.
The company's balance sheet as of Dec. 31, 2006, showed total
assets of US$2.55 billion, total liabilities of US$953.11
million, and minority interests of US$9.22 million, resulting to
total stockholders' equity of US$1.59 billion.
Cash and cash equivalents as of Dec. 31, 2006, totaled
US$175.38 million, as compared with US$114.82 million a year
earlier.
Discontinued Operations in 2006
During the first quarter of fiscal 2006, the company initiated
actions to sell Phase II-IV of the Clinical business. On
May 9, 2006, the company disclosed that it entered into a
definitive agreement to sell Phase II-IV of the Clinical
Services business for US$215 million in cash as part of a
portfolio realignment, which would allow the company to
capitalize on core competencies.
During 2006, the company closed its Interventional and Surgical
Services business, which was formerly included in the
Preclinical Services segment. It performed an impairment test
on the long-lived assets of the ISS business and based on that
analysis, the book value of the ISS assets exceeded the future
cash flows of the business. Accordingly, the company recorded
an impairment charge of US$1.07 million during 2006.
For the year-end Dec. 30, 2006, the discontinued businesses
recorded a loss from operations of US$181 million, which
included a US$546 loss from the sale of the Phase II-IV Clinical
business. As a direct result of the sale, the Company realized
a significant tax gain resulting in additional tax expense of
US$37.83 million, all of which has been paid by the end of
fiscal year 2006.
Northwest Kinetics Acquisition
On Oct. 30, 2006, the company acquired all of the capital stock
of privately held Tacoma, Washington based Northwest Kinetics
for US$29.5 million in cash. Northwest Kinetics runs clinical
trials, primarily in Phase I, in a 150-bed facility with a focus
on high-end clinical pharmacology studies.
The final price allocation of the Northwest Kinetics
acquisition, including transaction costs of US$265,000 and net
of US$812,000 of cash acquired, was US$28.81 million.
Long-term Liabilities
On July 31, 2006, the company amended and restated its then-
existing US$660 million credit agreement to reduce the current
interest rate, modify certain restrictive covenants and extend
the term.
The now US$428 million credit agreement provides for a US$156
million U.S. term loan facility, a US$200 million U.S. revolving
facility, a CAD57.8 million term loan facility and a CAD12
million revolving facility for a Canadian subsidiary, and a GBP6
million revolving facility for a U.K. subsidiary.
As of Dec. 30, 2006, there was no outstanding balance on the
revolving facility.
A full-text copy of the company's annual report is available for
free at http://ResearchArchives.com/t/s?1b13
About Charles River Laboratories
Wilmington, Mass.-based Charles River Laboratories International
Inc. (NYSE: CRL) -- http://www.criver.com/-- sells pathogen-
free, fertilized chicken eggs to poultry vaccine makers. It
also offers contract staffing, preclinical drug candidate
testing, and other drug development services. It also markets
research models -- rats and mice bred for preclinical
experiments, including transgenic "knock out" mice -- to the
pharmaceutical and biotech industries. It sells its products in
more than 50 countries including Argentina, Brazil, Peru, Puerto
Rico and Uruguay to drug and biotech companies, hospitals, and
government entities.
* * *
As reported in the Troubled Company Reporter on Dec. 27, 2006,
Moody's affirmed its ratings on Charles River Laboratories
International, Inc. with a negative outlook, Corporate Family
Rating, Ba1; Probability of Default Rating, Ba1; Loss Given
Default Assessment, LGD4, 50%; Senior Secured U.S. Revolving
Credit Facility (US$200 million face), Baa3, LGD2, 23%; and
Senior Secured U.S. term loan facility (US$156 million face),
Baa3, LGD2, 23%.
* PERU: Perupetro Inks Block Z-34 Exploration & Production Pact
---------------------------------------------------------------
Perupetro S.A., Peru's state hydrocarbons promotions agency, has
inked an agreement with European companies Gold Oil and Plectrum
Petroleum for Talara basin's offshore block Z-34 exploration and
production, Business News Americas reports, citing a company
statement.
In a statement, Gold Oil said the block "has potential for
typical deepwater turbidities, which normally have high
porosities and permeability."
"Excluding the deepwater turbidite plays, there is a potential
for at least 250Mb of oil in the shallower water areas," Gold
Oil said in its statement.
According to BNamericas, Gold Oil entered into a promotion
license with Perupetro on Feb. 7, 2005, for an initial period of
15 months.
* * *
As reported in the Troubled Company Reporter-Latin America on
March 2, 2007, Standard & Poor's Ratings Services assigned its
'BB+' foreign currency credit rating to the Republic of Peru's
(BB+/Stable/B foreign, BBB-/Stable/A-3 local currency sovereign
credit ratings) US$1.24 billion global bond due in 2037 issued
as part of a new liability management operation.
=====================
P U E R T O R I C O
=====================
BITHORN TRAVEL: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: Bithorn Travel Corp.
33 Resolution Street, Suite 601
Doral Bank Plaza
San Juan, Puerto Rico 00902
Bankruptcy Case No.: 07-01191
Type of Business: The Debtor is a travel agent.
See http://www.bithorn.com/
Chapter 11 Petition Date: March 8, 2007
Court: District of Puerto Rico (Old San Juan)
Debtor's Counsel: Carlos Rodriguez Quesada, Esq.
P.O. Box 9023115
San Juan, PR 00902-3115
Tel: (787) 724-2867
Fax: (787) 724-2463
Total Assets: US$4,740,403
Total Debts: US$8,040,451
The Debtor did not file a list of its 20 largest unsecured
creditors.
DRESSER INC: Riverstone Leads Investor Group in Buying Assets
-------------------------------------------------------------
A consortium led by Riverstone Holdings LLC has signed a
definitive agreement to acquire Dresser, Inc. Riverstone is
joined by First Reserve and Lehman Brothers Co-Investment
Partners in the investor group. First Reserve previously
acquired Dresser in 2001 in partnership with Odyssey Investment
Partners, and will invest in the current transaction through its
recently formed First Reserve Fund XI, L.P. Riverstone will
invest through its Carlyle/Riverstone Global Energy and Power
Fund III, L.P. The terms of the transaction were not disclosed.
John Lancaster, Managing Director of Riverstone, commented,
"Dresser has been a leader in the energy industry since its
founding in 1880 and remains extremely well positioned for
growth. This investment is consistent with Riverstone's
objective to sponsor companies that benefit from the continued
and increasing investment in energy and related infrastructure
globally. We are pleased that First Reserve and Lehman Brothers
are joining us in this investment, and look forward to working
together with them and the team at Dresser to build on the
Company's legacy of providing top-tier products and services."
Patrick M. Murray, Chairman and CEO of Dresser, commented, "We
are excited about the new ownership of Dresser. We believe our
dedicated and talented employees, our worldwide footprint, blue-
chip customer base, and strong product portfolio position us
very well for continued growth in the future."
Latham & Watkins provided legal advice and Lehman Brothers
served as financial advisor to the consortium.
About First Reserve
First Reserve -- http://www.firstreserve.com/-- is the oldest
and largest private equity firm specializing in the energy
industry. First Reserve was the first private equity investment
firm to actively pursue building a broadly diversified global
investment portfolio of companies involved in the various
sectors of the energy industry. Since 1992, First Reserve has
raised over US$12.7 billion for its buyout-focused funds.
Throughout its 25-year history, the strong franchise that the
firm has developed by investing exclusively in companies
involved in the energy industry has served as a competitive
advantage for First Reserve.
About Lehman Brothers
Lehman Brothers Co-Investment Partners -- http://www.lehman.com/
-- is a US$1.6 billion fund which invests alongside premier
private equity funds globally. Founded in 1850, Lehman Brothers
is a leading investment bank with activities in equity and fixed
income sales, trading and research, investment banking, private
investment management, asset management, and private equity.
The firm is headquartered in New York, with regional
headquarters in London and Tokyo, and operates in a network of
offices around the world.
About Riverstone Holdings LLC and
The Carlyle Group
Riverstone Holdings LLC -- http://www.riverstonellc.com/-- and
The Carlyle Group -- http://www.carlyle.com/-- are the co-
general partners of Carlyle/Riverstone Global Energy and Power
Funds. Riverstone, a New York-based energy and power focused
private equity firm founded in 2000, has US$8.0 billion under
management. Riverstone conducts buyout and growth capital
investments in the midstream, upstream, power, oilfield
services, and renewable sectors of the energy industry. To
date, the firm has committed more than US$5.0 billion to more
than 35 investments across each of these five sectors,
representing companies with nearly US$50 billion of assets. The
Carlyle Group is a global private equity firm with US$51.8
billion under management. Carlyle invests in buyouts, venture
and growth capital, real estate and leveraged finance in North
America, Europe and Asia. Since 1987, the firm has invested
US$24.0 billion of equity in 576 transactions.
About Dresser Inc.
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 Brazil,
Mexico and Puerto Rico.
DRESSER: Sale Cues Moody's Ratings Review for Likely Downgrade
--------------------------------------------------------------
Moody's Investors Service placed the ratings (B1 Corporate
Family Rating) for Dresser, Inc. under review for possible
downgrade. The review was prompted by the announcement that
Riverstone Holdings LLC, in partnership with First Reserve and
Lehman Brothers Co-Investment Partners, has signed a definitive
agreement to acquire Dresser from First Reserve and Odyssey
Investment Partners, LLC. The buyout is expected to be financed
largely with debt. First Reserve and Odyssey Investment
Partners had previously acquired 88% of Dresser's outstanding
equity from Halliburton Company in April 2001 for US$1.3
billion.
Moody's decision to review Dresser's ratings for possible
downgrade reflects the expectation of a substantial increase in
the company's financial leverage as a result of the transaction.
Moody's estimates that Dresser's balance sheet debt obligations
will increase over two times, with debt/EBITDA increasing to a
level higher than all of the company's B1 rated peers. Moody's
notes that Dresser's operating performance has been improving
recently and that its business profile is more indicative of the
Ba rating category. However, the company's weakened financial
profile, in addition to the challenges the company faces in
order to complete its restated financial statements and
remediate its material weaknesses over internal controls,
represents an elevated overall risk profile that may not be
compatible with the B1 Corporate Family Rating.
Moody's review will entail a review of the company's financial
flexibility following the buyout, the prospects for near-term
leverage reduction to a level consistent with a B1 Corporate
Family Rating (between 4x-6x debt/EBITDA, as adjusted for
operating leases and pension liabilities), and the company's
future operating strategy, including efforts to improve
operational efficiencies and future growth strategies. The
review will also consider Riverstone's extensive energy industry
experience and the equity sponsors' willingness to provide
additional financial support to Dresser.
Dresser is currently in the process of restating its 2003 and
2004 annual financial statements, although without public
securities, it is no longer required to meet SEC reporting
requirements. The company has reported a number of material
weaknesses, which are the root cause for its filing delays and
restatements. Moody's notes that Dresser is making efforts to
address the material weaknesses. Should the delay in completing
the restatements and becoming current on its 2005 and 2006
annual financial statements continue to be extended and if
Moody's determines that it lacks sufficient financial
information to appropriately monitor the company's credit, the
ratings could be withdrawn.
Moody's expects that existing debt instruments of Dresser will
be refinanced as part of this transaction. If this transpires,
the ratings will be withdrawn at the time of close of the new
financing.
Moody's placed these ratings under review for possible
downgrade:
i) B1 Corporate Family Rating
ii) B1 (LGD 3, 37%) rated senior secured bank credit
facilities
iii) B2 Probability of Default Rating
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 Brazil,
Mexico and Puerto Rico.
NEWCOMM WIRELESS: Court OKs US$103.2MM Asset Sale to PR Wireless
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Puerto Rico
authorized NewComm Wireless Services, Inc., to sell
substantially all of its assets to PR Wireless, Inc., for
US$103.2 million, subject to higher and better offers.
As reported in the Troubled Company Reporter on Dec. 21, 2006,
under the asset purchase agreement, PR Wireless is liable to pay
US$3 million if it wins the bidding but fails to consummate the
sale, while it stands to get US$3.3 million break-up fee if it
loses to another bidder.
Proceeds from the sale will be used to pay NewComm's secured
prepetition debt and fund its network upgrade project that would
give it a competitive advantage.
The sale transaction is expected to close by April 15, 2007.
Based in Guaynabo, Puerto Rico, NewComm Wireless Services Inc.
is a PCS company that provides wireless service to the Puerto
Rico market. The company is a joint venture between ClearComm,
L.P. and Telefonica Larga Distancia. The company filed for
chapter 11 protection on Nov. 28, 2006 (Bankr. D. P.R. Case No.
06-04755). Carmen D. Conde Torres, Esq., at C. Conde & Assoc.
and Peter D. Wolfston, Esq., at Sonnenschein Nath & Rosenthal
LLP represent the Debtor in its restructuring efforts. Mark J.
Wolfson, Esq. at Foley & Lardner LLP and Sergio A. Ramirez de
Arellano, Esq., at Sergio Ramirez de Arrelano Law Office
represent the Official Committee of Unsecured Creditors. When
the Debtor filed for protection from its creditors, it reported
assets and liabilities of more than US$100 million.
NEWCOMM WIRELESS: Panel Hires Falkenberg as Financial Advisors
--------------------------------------------------------------
The Official Committee of Unsecured Creditors of Newcomm
Wireless Services, Inc., obtained permission from the U.S.
Bankruptcy Court for the District of Puerto Rico to retain
Falkenberg Capital Corp. as its financial advisors.
Falkenberg Capital is expected to:
a) advise the Committee regarding the Debtor's proposed
upgrade of its existing wireless network, which includes
the agreement between the Debtor and Nortel Networks
(CALA) Inc., Nortel Networks Limited and Nortel Networks
Puerto Rico governing the upgrade;
b) evaluate and advise the Committee regarding the Debtor's
sale of substantially all of its assets in connection with
the bidding procedures already approved by the Bankruptcy
Court; and
c) assist the Committee in evaluating competing bids to buy
the Debtor's assets.
George E. Harris, Falkenberg Capital's senior vice president,
disclosed that Falkenberg Capital would charge the Debtor a
US$50,000 flat fee for its work. The first half payment would
be due upon the entry of the Court's final order and the
remaining US$25,000 would be paid after the auction completion
of the Debtor's assets on Feb. 28, 2007, but not later than
March 9, 2007, Mr. Harris adds.
Mr. Harris assured the Court that his firm is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code.
Mr. Harris can be reached at:
Falkenberg Capital Corp.
Cherry Creek Plaza, Suite 1108
600 South Cherry Street
Denver, CO 80246
Fax: (303) 322-5796
Based in Guaynabo, Puerto Rico, NewComm Wireless Services Inc.
is a PCS company that provides wireless service to the Puerto
Rico market. The company is a joint venture between ClearComm,
L.P. and Telefonica Larga Distancia. The company filed for
chapter 11 protection on Nov. 28, 2006 (Bankr. D. P.R. Case No.
06-04755). Carmen D. Conde Torres, Esq., at C. Conde & Assoc.
and Peter D. Wolfston, Esq., at Sonnenschein Nath & Rosenthal
LLP represent the Debtor in its restructuring efforts. Mark J.
Wolfson, Esq. at Foley & Lardner LLP and Sergio A. Ramirez de
Arellano, Esq., at Sergio Ramirez de Arrelano Law Office
represent the Official Committee of Unsecured Creditors. When
the Debtor filed for protection from its creditors, it reported
assets and liabilities of more than US$100 million.
=============
U R U G U A Y
=============
NAVIOS MARITIME: Secures Five-Year Time Charter Contract
--------------------------------------------------------
Navios Maritime Holdings Inc. has secured a new favorable time
charter contract for its long-term chartered-in 83,000 dwt
panamax, the Navios Prosperity. This large, modern vessel is
scheduled to be delivered to Navios's chartered-in fleet in June
of this year. The company also holds a purchase option on this
vessel.
The five-year charter will commence upon delivery of the vessel
in June at a net rate of US$24,000 per day.
"We are experiencing a healthy market for time charters. In our
view, the rate and length of this charter are very attractive,
particularly as the Navios Prosperity will not be delivered into
our fleet for another three months," said Ms. Angeliki Frangou,
Chairman and CEO of Navios. "More importantly however, the
creditworthiness of the counterparty allows us to enter into a
charter of 5 years. We will continue to leverage the quality of
our fleet to generate stable cash flow and shareholder value."
As a result of these charters, Navios has extended the coverage
of its core fleet (excluding vessels acquired through the
Kleimar N.V. transaction) to 85.5% for 2007, 52.8% for 2008 and
14.4% for 2009.
Navios currently controls 45 vessels, of which 21 are owned and
24 are chartered-in. Of the 24 chartered-in vessels, 15 are
currently operating, and nine are still to be delivered. Navios
holds ten purchase options on the 24 chartered-in vessels, six
on operating vessels, and four on the vessels still to be
delivered. All of these purchase options are for exercise
prices below the related vessel's current market value.
Navios Maritime Holdings Inc. (Nasdaq: BULK, BULKU, BULKW) --
http://www.navios.com/-- is a vertically integrated global
seaborne shipping company, specializing in the worldwide
carriage, trading, storing, and other related logistics of
international dry bulk cargo transportation. The company also
owns and operates a port/storage facility in Uruguay and has in-
house technical ship management expertise. It maintains offices
in Piraeus, Greece, South Norwalk, Connecticut and Montevideo,
Uruguay.
* * *
In November 2006, Standard & Poor's Ratings Services assigned
its 'BB-' long-term corporate credit rating to Greece-based
dry-bulk shipping company Navios Maritime Holdings Inc. At the
same time, Standard & Poor's assigned its preliminary 'B' debt
rating to Navios' proposed US$300-million senior unsecured
bonds. S&P said the outlook is stable.
* URUGUAY: Warns of Status Demotion in Mercosur Trade Bloc
----------------------------------------------------------
The Uruguayan government has threatened to demote its status in
Mercosur if the trade bloc won't allow the nation to have a
bilateral trade deal with the United States, The Financial Times
reports.
According to the FT, Mercosur is against a full trade accord.
The trade bloc requires members to negotiate the deals
collectively.
Uruguayan Trade Minister Danilo Astori told the FT, "Uruguay
must find a way of making a bilateral trade deal with the U.S.
Our small country is trapped, a prisoner of the collective
wishes of the group, and this is causing us serious harm."
FT underscores that Minister Astori was willing to negotiate
bilateral deals together with the rest of Mercosur members.
However, he alleged that there was no willingness in the other
members to do so. After 12 years of trying, no agreement had
been reached between Mercosur and the European Union.
Minister Astori explained to the FT that there was much at stake
and that it is a matter of life or death for the entire sectors
of the Uruguayan economy.
The report says that Uruguay and Paraguay complained that Brazil
and Argentina, Mercosur's largest members, prevented access to
their markets, deepening trade deficit. Minister Astori worried
that Argentina will continue to be less willing than Brazil to
let Uruguay negotiate bilateral deals.
"There are notorious difficulties with our relationship with
Argentina. That, of course, is where the principal problems
lie," Minister Astori told FT.
Uruguay wants a waiver to make bilateral deals outside Mercosur
while remaining a full member. If Mercosur would not permit
that, Minister Astori wouldn't rule out downgrading to partial
membership, FT says.
* * *
On Sept 11, 2006, Fitch rated Uruguay's US$400 million issue of
5% inflation-indexed bonds payable in U.S. dollars and maturing
Sept. 14, 2018, at 'B+'.
=================
V E N E Z U E L A
=================
DAIMLERCHRYSLER: Chrysler Group to Recall Over 489,000 Vehicles
---------------------------------------------------------------
Chrysler Group, DaimlerChrysler AG's U.S. arm, disclosed Friday
that it would recall over 489,000 vehicles, Reuters reports.
Reuters relates that this is the second recall action done by
Chrysler. It had previously recalled almost 51,000 vehicles to
reprogram software for anti-lock brakes in late February.
Chrysler will recall:
* 328,424 Durango SUVs, which covers 2004 to 2006 models,
citing the risk of overheating linked to an integrated
circuit in the instrument cluster of the vehicles;
* 10,994 2008 model Dodge Avenger sedans due to problems
with the door latches; and
* 149,605 Jeep Liberty vehicles, 2006 and 2007 model-year,
because of a problem with the blower motor in the air-
conditioning system.
Reuters relates that aside from the direct expense involved in a
vehicle recall, the move could also damage the brand's longer-
term reputation for reliability.
About DaimlerChrysler
Headquartered in Stuttgart, Germany, DaimlerChrysler AG --
http://www.daimlerchrysler.com/-- develops, manufactures,
distributes, and sells various automotive products, primarily
passenger cars, light trucks, and commercial vehicles worldwide.
It primarily operates in four segments: Mercedes Car Group,
Chrysler Group, Commercial Vehicles, and Financial Services.
The company's worldwide operations are located in: Canada,
Mexico, United States, Argentina, Brazil, Venezuela, China,
India, Indonesia, Japan, Thailand, Vietnam and Australia.
The Chrysler Group segment offers cars and minivans, pick-up
trucks, sport utility vehicles, and vans under the Chrysler,
Jeep, and Dodge brand names. It also sells parts and
accessories under the MOPAR brand.
The Chrysler Group is facing a difficult market environment in
the United States with excess inventory, non-competitive legacy
costs for employees and retirees, continuing high fuel prices
and a stronger shift in demand toward smaller vehicles. At the
same time, key competitors have further increased margin and
volume pressures -- particularly on light trucks -- by making
significant price concessions. In addition, increased interest
rates caused higher sales & marketing expenses.
In order to improve the earnings situation of the Chrysler Group
as quickly and comprehensively, measures to increase sales and
cut costs in the short term are being examined at all stages of
the value chain, in addition to structural changes being
reviewed as well.
* VENEZUELA: Confirms Resumption of Costa Rican Plant Operations
----------------------------------------------------------------
Jose Huerta Castillo, Venezuela's designated Ambassador to Costa
Rica, confirmed to El Universal the resumption of the operations
of Alunasa, the Costa Rican subsidiary of Venezuela's state
heavy industry holding Corporacion Venezolana de Guyana.
As reported in the Troubled Company Reporter-Latin America on
March 6, 2007, Venezuelan President Hugo Chavez said that the
decision to continue supplying aluminum raw material to Alunasa
was temporary and that some Venezuelan officials would visit
Costa Rica to evaluate Alunasa. The Venezuelan leader had
decided not to shut down Alunasa after a meeting with workers
from the firm. President Chavez had decided to close down
Alunasa and relocate it to Nicaragua due to geopolitical,
technical and economic reasons, contrary to what reports said
that the closure was caused by his political spat with Costa
Rican President Oscar Arias. President Arias had said that the
special powers granted to President Chavez were "the antithesis
of democracy." The statement allegedly offended President
Chavez, who then ordered the immediate suspension of his
country's aluminum shipments to Costa Rica. That decision was
also taken back.
Mr. Castillo described to Costa Rican daily Al Dia the impending
closure of Alunasa in February a "an overcome chapter."
"President Hugo Chavez met in Caracas with a delegation of
workers of such company. Our President is eager to proceed with
the operations of this factory," Mr. Castillo told El Universal.
* * *
As reported in the Troubled Company Reporter on Nov. 20, 2006,
Fitch Ratings affirmed Venezuela's long-term foreign and local
currency Issuer Default Ratings at 'BB-'. At the same time, the
agency also affirmed the short-term foreign currency IDR at 'B'
and the Country Ceiling at 'BB-'. Fitch said the outlook on the
ratings remains stable.
* VENEZUELA: ExxonMobil to Surrender Oil Project to Gov't
---------------------------------------------------------
Industry sources told Reuters that Exxon Mobil Corp., a U.S.
major oil company, will hand over operations of a multi-billion-
dollar oil project to the Venezuelan government before the May 1
deadline that President Hugo Chavez set.
The president of Exxon's Venezuela division signed an internal
memo that said the firm was preparing a transition before May to
give state oil company Petroleos de Venezuela control of the
project, Reuters states, citing one of the sources.
As reported in the Troubled Company Reporter-Latin America on
March 2, 2007, President Chavez signed a decree to nationalize
four extra-heavy crude oil projects in the Orinoco belt. Under
the decree, the Orinoco projects have to abide by the 2004
hydrocarbons law, giving Venezuelan state-owned oil company
Petroleos de Venezuela SA a majority stake. The four Orinoco
projects, which have capacity to produce 620,000 barrels per day
of oil but are churning out less than 600,000 barrels per day,
include:
-- Ameriven,
-- Petrozuata,
-- Cerro Negro, and
-- Sincor.
Petroleos de Venezuela has a 40% stake on average in each
project. It seeks to raise the stake to 60%.
The foreign partners in the Orinoco projects are:
-- US oil and gas major ExxonMobil,
-- UK's BP,
-- US major ConocoPhillips,
-- France's Total,
-- Norway's Statoil, and
-- US oil and gas major Chevron.
Industry analysts told Reuters that ExxonMobil was expected to
take the "toughest line" with Venezuela.
According to Reuters, the analysts doubted Petroleos de
Venezuela's technical capacity to run the complex operations
valued at an estimated US$30 billion.
Reuters underscores that other firms involved in the Orinoco
projects expressed doubts that they would be able to meet the
deadline.
"We have had no meaningful discussions with the Venezuelan
leadership," said Conoco Phillips Chief Executive Officer James
Mulva told the press.
* * *
As reported in the Troubled Company Reporter on Nov. 20, 2006,
Fitch Ratings affirmed Venezuela's long-term foreign and local
currency Issuer Default Ratings at 'BB-'. At the same time, the
agency also affirmed the short-term foreign currency IDR at 'B'
and the Country Ceiling at 'BB-'. Fitch said the outlook on the
ratings remains stable.
* VENEZUELA: Ministry Forms New Office to Record Oil Output
-----------------------------------------------------------
The Venezuelan energy and oil ministry said in a statement that
it has created the Metrologia de Hidrocarburos, a new office for
hydrocarbons metrology that will tally the volume and quality of
hydrocarbons extracted during exploration and production.
According to the ministry's statement, the data that the new
office collects will be considered reliable and precise. The
data will be used in determining the royalty, extraction tax and
other taxes.
Business News Americas relates that Venezuela has raised taxes
and royalties for oil and gas exploration and production
activities since 2004. The oil projects pay 83.3% or more in
combined royalties and taxes.
The report says that the new office will provide data about
Venezuela's oil output.
BNamericas underscores that Venezuelan state-run oil company
Petroleos de Venezuela says the nation is producing 3.3 million
barrels of oil daily, while market-watchers like the
International Energy Agency say production is at 2.5 million
barrels per day.
Ministry officials told BNamericas that a general director in
the ministry will be appointed to head the new office. A
general director is one rank below deputy ministers Bernard
Mommer and Maria Gabriela Gonzalez.
The new office will also measure the volumes of oil derivates in
transport and storage, the ministry said in a statement.
* * *
As reported in the Troubled Company Reporter on Nov. 20, 2006,
Fitch Ratings affirmed Venezuela's long-term foreign and local
currency Issuer Default Ratings at 'BB-'. At the same time, the
agency also affirmed the short-term foreign currency IDR at 'B'
and the Country Ceiling at 'BB-'. Fitch said the outlook on the
ratings remains stable.
* BOND PRICING: For the Week March 5 to March 9, 2007
-----------------------------------------------------
Issuer Coupon Maturity Currency Price
------ ------ -------- -------- -----
ARG Boden 2.000 9/30/08 ARS 55.1661
Argent-Par 0.630 12/31/38 ARS 58.1667
Gov't of Belize 9.500 9/15/12 USD 73.0000
Gov't of Belize 9.750 6/12/15 USD 67.0000
Colombia, Rep. of 11.750 2/23/23 UVR 60.1349
Colombia TES 4.750 2/23/23 COP 60.1233
Vontobel Cayman 18.600 4/30/07 USSW 73.8000
Vontobel Cayman 10.700 12/28/07 CHRN 68.7000
Vontobel Cayman 11.200 12/28/07 NOBE 74.9000
Vontobel Cayman 11.850 12/28/07 SUN 74.5000
Vontobel Cayman 22.850 12/28/07 SUN 59.0000
* Large Companies with Insolvent Balance Sheets
-----------------------------------------------
Total
Shareholders Total
Equity Assets
Company Ticker (US$MM) (US$MM)
------- ------ ------------ -------
Kuala ARTE3 (33.57) 11.86
Kuala-Pref ARTE4 (33.57) 11.86
Bombril BOBR3 (781.53) 473.67
Bombril-Pref BOBR4 (781.53) 473.67
CIC CIC (1,883.69) 22,312.12
Telefonica Hldg CITI (1,481.31) 307.89
Telefonica Hldg CITI5 (1,481.31) 307.89
SOC Comercial PL COME (743.79) 459.53
CIMOB Partic SA GAFP3 (44.38) 121.74
CIMOB Part-Pref GAFP4 (44.38) 121.74
DOC Imbituba IMBI3 (19.84) 192.80
DOC Imbitub-Pref IMBI4 (19.84) 192.80
IMPSAT Fiber Networks IMPTQ (17.16) 535.01
Kepler Weber KEPL3 (22.20) 478.81
Paranapanema SA PMAM3 (53.36) 3,268.96
Paranapanema-PREF PMAM4 (53.36) 3,268.96
Telebras-CM RCPT RCTB30 (59.79) 228.35
Telebras-PF RCPT RCTB40 (59.79) 228.35
Teka TEKA3 (236.45) 540.81
Teka-PREF TEKA4 (236.45) 540.81
Telebras SA TELB3 (59.79) 228.35
Telebras SA-Pref TELB4 (59.79) 228.35
Telebras-CM RCPT TELE31 (59.79) 228.35
Telebras SA TELE41 (59.79) 228.35
Telebras SA-Pref TLBRPN (59.79) 228.35
Varig SA VAGV3 (8,194.58) 2,169.10
Varig SA-PREF VAGV4 (8,194.58) 2,169.10
***********
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
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Copyright 2076. All rights reserved. ISSN 1529-2746.
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