/raid1/www/Hosts/bankrupt/TCRLA_Public/071108.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
Thursday, November 8, 2007, Vol. 8, Issue 222
Headlines
A R G E N T I N A
ALITALIA SPA: Intesa-Sanpaolo Backs Alitalia-AirOne Merger Plan
BUNGE LTD: S&P Rates US$750 Million Convertible Shares at BB
DUAIELLO SRL: Proofs of Claim Verification Is Until Feb. 26
FLOWER POWER: Files for Reorganization Petition in Buenos Aires
GAS DEL NORTE: Fitch Upgrades Issuer Default Ratings to B
GAS DEL SUR: Fitch Lifts Foreign & Local Issuer Ratings to B+
GLOBAL CROSSING: Loses US$89 Million in Third Quarter 2007
POLYMER GROUP: Plans to Sell 5.5 Million of Class A Common Stock
POLIPROLDUCTOS ARGENTINOS: Claims Verification Is Until Feb. 4
PRODUCTOS TEXTILES: Proofs of Claim Verification Ends Feb. 22
PROTAM SA: Proofs of Claim Verification Deadline Is Dec. 14
SUCESION DE DAYAN: Seeks for Reorganization Okay in Buenos Aires
UNIMED SA: Proofs of Claim Verification Is Until Feb. 20
B E R M U D A
COMPLETE RETREATS: Gram, et al. Wants Adversary Case Dismissed
COMPLETE RETREATS: Wants Multihull Settlement Approved
WR GRACE: Asbestos PI Committee & FCR File Reorganization Plan
B R A Z I L
AUTOCAM CORP: S&P Withdraws B Corporate Credit Rating
BANCO NACIONAL: Approves BRL1.5-Million Financing to Arco-Iris
BANCO NACIONAL: Forming Technological Center with Companhia Vale
COSAN SA: Reports Tender Offer & Consent Solicitation Results
DELPHI CORP: Equity Panel Balks at Disclosure Statement Changes
EL PASO: Reports US$922 Mil. Net Income for Qtr. Ended Sept. 30
FERRO CORP: Polymer Products Hikes Plastic Compound Prices
FORD MOTOR: UAW Members to Vote on New Labor Pact on Sunday
GENERAL MOTORS: Expects US$39 Bil. Non-Cash Charge in 3rd Qtr.
GERDAU AMERISTEEL: Net Income Up 35% to US$123.8MM in Third Qtr.
IWT TESORO: Can Get US$3.3-Mil. DIP Loan from Bank of America
IWT TESORO: Court Okays Mahoney Cohen as Panel's Fin'l Advisor
KENDLE INT'L: Moody's Affirms Corporate Family Rating at B1
MILACRON INC: Posts US$4.5-Mln Net Loss in Third Quarter of 2007
STRATUS TECH: Appoints Ira Feuer as Vice Pres. of Business Dev't
C A Y M A N I S L A N D S
BEAR STEARNS FUNDS: Investors to Vote on Bear Stearns Directors
BEAR STEARNS: Judge Lifland Postpones Ruling on BofA's Request
BEAR STEARNS: Massachusetts Regulators Probe on Funds' Trading
BMIT CORP: Proofs of Claim Filing Deadline Is Nov. 19
FIRST CAYMAN: Will Pay Final Dividend to Creditors
GAMMA: Proofs of Claim Filing Deadline Is Nov. 19
GAMMA GLOBAL: Proofs of Claim Filing Ends on Nov. 19
GAMMA RELATIVITY: Proofs of Claim Filing Is Until Nov. 19
GAMMA RELATIVITY INT'L: Proofs of Claim Filing Ends on Nov. 19
GAMMA RELATIVITY INT'L OFFSHORE: Claims Filing Is Until Nov. 19
GAMMA RELATIVITY LOW: Proofs of Claim Filing Ends on Nov. 19
PARMALAT SPA: Parma Prosecutors Can Prove BofA Link, Report Says
SAMLEY FUND: Proofs of Claim Filing Deadline Is Nov. 18
C H I L E
AES CORP: Reports US$103-Mil. Net Income in Qtr. Ended Sept. 30
BOSTON SCIENTIFIC: Announces Data Integration w/ GE Healthcare
BOSTON SCIENTIFIC: Selling Cardiac & Vascular Biz for US$750 Mln
EASTMAN KODAK: Launches New Manufacturing Plant in Xiamen, China
REVLON INC: Sept. 30 Balance Sheet Upside-Down by US$1.1 Billion
THERMADYNE HOLDINGS: Earns US$1 Million in Qtr. Ended Sept. 30
C O L O M B I A
COMPANIA DE DESAROLLO: S&P Affirms BB+ Rating on US$116MM Notes
SOLUTIA INC: Wants US$713 Mil. Environmental Claims Reclassified
C O S T A R I C A
ANIXTER INT'L: To Repurchase Up to 1 Mil. of Outstanding Shares
E C U A D O R
PETROECUADOR: New Oil Law May Lead to 3,600 Job Cuts
E L S A L V A D O R
* MIF Fund Says Remittances to Central America Up to US$12.1-Bln
G U A T E M A L A
FLOWSERVE CORP: To Supply Control & Valves for Horizonte Project
H O N D U R A S
CHOICE HOTELS: Executes Agreement with Winport Developments
J A M A I C A
GOODYEAR TIRE: Commences Exchange Offer for 4% Convertible Notes
MIRANT CORP: Mirant Lovett Posts US$1,130,285 Aug. 2007 Net Loss
M E X I C O
ADVANCED MARKETING: Wants Until Nov. 30 to Decide on Lone Lease
ATHLETES WORLD: Files for Creditor Protection Under CCAA
AXTEL SAB: Moody's Upgrades Corporate Family Rating to Ba2
BURGER KING: Names Armando Jacomino as President for LatAm Biz
CINRAM INTERNATIONAL: Weak Perfomance Cues S&P's Negative Watch
DANA CORP: Supplies Drivetrain Components to Chrysler LLC
FEDERAL-MOGUL: Plan Proponents Incorporate Insurer Settlements
GREENBRIER COS: Declares US$.08 Per Share Quarterly Dividend
GREENBRIER COS: Earns US$13.2 Million in Fourth Quarter 2007
GRUPO GIGANTE: Acquires PriceSmart's 50% Stake in PSMT Mexico
GRUPO GIGANTE: Mulls Sale of Some Assets
HIPOTECARIA SU: Extends Cash Tender Offer for 8.50% Senior Notes
MOVIE GALLERY: Bankruptcy Cues Moody's to Withdraw Ratings
QUAKER FABRIC: Court Okays J.H. Albert as Insurance Consultants
URS CORP: Amends Pact with WGI to Raise Merger Consideration
X-RITE INC: Incurs US$2.8-Mln Net Loss in Quarter Ended Sept. 29
P U E R T O R I C O
MARCOS GARCIA: Case Summary & 11 Largest Unsecured Creditors
UNIVISION COMMS: Incurs US$26.8-Mln Net Loss in Third Quarter
V E N E Z U E L A
ARVINMERITOR INC: Unit Awarded Supply Business by Hyundai Motor
HERBALIFE LTD: Reports US$48-Mln Net Income in 2007 Third Qtr.
* Beard Group Announces New Audio Conference for November 15
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A R G E N T I N A
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ALITALIA SPA: Intesa-Sanpaolo Backs Alitalia-AirOne Merger Plan
---------------------------------------------------------------
Intesa-Sanpaolo S.p.A. confirmed reports that it is contributing
to a feasibility study that plans to combine Alitalia S.p.A.
with AirOne S.p.A., the bank said in a statement.
Intesa-Sanpaolo added it might acquire a minority stake in the
combined company.
Intesa-Sanpaolo was AirOne's financial backer for the latter's
bid until they pulled out from the race to acquire Italy's 49.9%
stake in Alitalia, citing lack of relevant information.
AirOne, through bidding vehicle AP Holding S.p.A. has restarted
sale talks.
As reported on Oct. 4, 2007, Intesa-Sanpaolo chief executive
Corrado Passera hopes that Alitalia S.p.A.'s business plan could
make it more competitive and keep its Italian identity.
"We hoped to see a long-term industrial project that can allow
Italy to have a successful company," Mr. Passera told Reuters.
"We think that it is in the country's interest to have a
company's decisional headquarters."
About Alitalia
Headquartered in Rome, Italy, Alitalia S.p.A. --
http://www.alitalia.it/-- provides air travel services for
passengers and air transport of cargo on national, international
and inter-continental routes. The Italian government owns 49.9%
of Alitalia. The company has operations in Argentina.
Despite a EUR1.4 billion state-backed restructuring in 1997,
Alitalia posted net losses of EUR256 million and EUR907 million
in 2000 and 2001 respectively. Alitalia posted EUR93 million in
net profits in 2002 after a EUR1.4 billion capital injection.
The carrier booked annual net losses of EUR520 million in 2003,
EUR813 million in 2004, EUR168 million in 2005, and EUR625.6
million in 2006.
BUNGE LTD: S&P Rates US$750 Million Convertible Shares at BB
------------------------------------------------------------
Standard & Poor's Ratings Services has assigned its 'BB' rating
to Bunge Ltd.'s US$750 million of 5.125% cumulative mandatory
convertible preference shares. At the same time, S&P affirmed
its 'BBB-' long-term corporate credit and other ratings on
Bunge. The outlook is stable. Pro forma for the new issue,
about US$4.2 billion of debt and preference shares of the
company are rated. Proceeds from this issue will be used to
repay debt and for general corporate purposes.
"The new preference share issue will receive high equity content
under S&P's methodology because of its mandatory conversion
feature," said S&P's credit analyst Jayne Ross. Each preference
share automatically converts into 8.2190 to 9.6984 common
shares.
"The ratings on Bunge reflect the company's position as the
largest player in global oilseed origination, trading, and
processing, with broad geographic diversity," said Ms. Ross.
"Good positions in U.S. milling, vertically integrated Latin
American fertilizer operations, and complementary businesses in
food processing provide Bunge with a fairly diverse product
portfolio. These strengths are tempered by the company's
aggressive financial policies and lack of consistent and
satisfactory free operating cash flow."
Headquartered in White Plains, New York, Bunge Ltd. is a global
agribusiness company with operations primarily in commodity
grain processing and fertilizer production. It has operations
in Argentina.
DUAIELLO SRL: Proofs of Claim Verification Is Until Feb. 26
-----------------------------------------------------------
Eva Manzanel, the court-appointed trustee for Duaiello SRL's
bankruptcy proceeding, verifies creditors' proofs of claim until
Feb. 26, 2007.
Ms. Manzanel will present the validated claims in court as
individual reports. The National Commercial Court of First
Instance No. 8 in Buenos Aires, with the assistance of Clerk
No. 16, will determine if the verified claims are admissible,
taking into account the trustee's opinion, and the objections
and challenges that will be raised by Duaiello and its
creditors.
Inadmissible claims may be subject for appeal in a separate
proceeding known as an appeal for reversal.
A general report that contains an audit of Duaiello's accounting
and banking records will be submitted in court.
Ms. Manzanel is also in charge of administering Duaiello's
assets under court supervision and will take part in their
disposal to the extent established by law.
The debtor can be reached at:
Duaiello SRL
Albarino 3570
Buenos Aires, Argentina
The trustee can be reached at:
Eva Manzanel
Avenida Nazca 1085
Buenos Aires, Argentina
FLOWER POWER: Files for Reorganization Petition in Buenos Aires
---------------------------------------------------------------
Flower Power SA has requested for reorganization approval after
failing to pay its liabilities since November 2006.
The reorganization petition, once approved by the court, will
allow Flower Power to negotiate a settlement with its creditors
in order to avoid a straight liquidation.
The case is pending in the National Commercial Court of First
Instance No. 6 in Buenos Aires. Clerk No. 11 assist in this
case.
The debtor can be reached at:
Flower Power SA
Honduras 4900
Buenos Aires, Argentina
GAS DEL NORTE: Fitch Upgrades Issuer Default Ratings to B
---------------------------------------------------------
Fitch Ratings has upgraded the long-term foreign and local
currency Issuer Default Rating of Transportadora de Gas del
Norte S.A. to 'B' from 'B-'. Fitch has also upgraded the senior
unsecured issue rating to 'B' from 'B-', still reflecting a
recovery expectation in the 'RR4' category. In addition, Fitch
has upgraded Transportadora Norte's National Scale Rating to 'A-
(arg)' from 'BBB(arg)'. All ratings have a Stable Outlook.
The rating action is based on the company's improved financial
profile. Despite a challenging energy environment, the company
maintains an adequate operating performance and internal cash
generation. As of June 30, 2007, the company posted credit-
protection measures that are strong for its current ratings,
with total debt/EBITDA of 3.8 times and EBITDA/interest expense
of 2.3. However, regulatory risk arising from its main gas
pipeline business continues to affect the company's ratings.
Transportadora Norte is exposed to a weak regulatory framework,
the sector's underinvestment, and is vulnerable to government
interference, and exchange rate and inflation risks. Since
1999, the company has had a flat tariff structure and future
tariff adjustments require approval from its regulator. To
date, the company's tariff review is pending; this negotiation
is of consideration in reducing regulatory risk.
Transportadora Norte benefits from a stable revenue stream and
relatively predictable cash flow, low volume sensitivity and a
fixed payment contract position. The company is one of the two
natural gas pipeline monopolies in Argentina (40% of the market)
and throughout its concession contract life it has demonstrated
a strong operating performance. As of June 30, 2007, half of
its revenues are originated in hard currency through export gas
contracts and operation and maintenance contracts.
Transportadora Norte enjoys a healthy financial position,
moderate leverage and a smooth debt repayment profile. The
company maintains a reasonable leveraged capital structure at
48%. Transportadora Norte's total debt was US$386 million as of
June 2007, composed of US$182.5 million amortizing notes at 6.5%
step-up due in 2012 and US$204 million bullet notes at 7.5%
step-up due in 2012. Debt restructuring was completed in late
August 2006. The company's financial flexibility is limited by
a covenant package that restricts cash applications. Adequate
liquidity levels, as of June 30, 2007, were partially utilized
to cancel US$9 million of amortizing notes. Given expected cash
surpluses, further debt reductions are likely to occur.
Expected free cash flow will be positive and no additional debt
is anticipated for the medium term. Going forward, EBITDA is
estimated at US$95 million, with capital expenditures at a
minimum level of US$18 million, projecting a FCF of US$73
million for the next two years, against a debt service of
approximately US$60 million. Concurrently, debt service
coverage is expected to average 1.5 with EBITDA and 2.2
considering FCF plus cash and marketable securities. Credit
metrics are expected to remain stable under the assumption that
the core business continues performing at its current pace.
Transportadora de Gas del Norte SA is a natural gas pipeline
company serving the northern and central-west pipelines of
Argentina. The regulated business accounts for 94% of revenues
as of year-end 2006 and also operates and maintains third-party
pipelines. The company benefits from an exclusive 35-year
concession contract, ending Dec. 28, 2027, which may be extended
for an additional 10 years. The parent company is Gasinvest
S.A., which has a 56.35% stake and comprises five companies:
Totalfinaelf (27.2%), Transcogas Inversora S.A. (22.3%),
Compania General de Combustibles (5%), Organizacion Techint
(27.2%), and Petroliam Nasional Berhad (18.3%). In addition,
CMS Gas Argentina holds 23.5% of Transportadora Norte's shares,
while the remaining 20% is traded on the Buenos Aires stock
exchange.
GAS DEL SUR: Fitch Lifts Foreign & Local Issuer Ratings to B+
-------------------------------------------------------------
Fitch Ratings has upgraded the long-term foreign and local
currency Issuer Default Rating of Transportadora de Gas del Sur
S.A. to 'B+' from 'B'. In addition, Fitch has upgraded the
senior unsecured issue rating to 'B+' from 'B', reflecting a
recovery expectation in the 'RR4' category. All ratings have a
Stable Outlook.
The local and foreign currency IDR of Transportadora Sur
reflects the company's moderate business risk profile, the
sector's weak regulatory framework, solid financial position and
adequate operations in the gas transportation and gas processing
business in Argentina.
Gas transportation accounted for 38 percent of Transportadora
Sur's total net revenues as of June 2007 with the remaining 62
percent related to gas processing and other services. The
company's monopoly position and long term fixed contracted
position in the gas transportation businesses provide the
company with a stable stream of cash flow. More than 90 percent
of gas transportation sales are made under long-term firm
transportation contracts with four distribution companies and a
few large industrial customers. Since 1999, a flat tariff
structure has adversely impacted the cost structure of this
business unit and the linkage to the argentine peso led to
currency risk.
Gas processing represents a notable source of revenue.
Positively, Transportadora Sur's gas processing business has
performed well, largely driven by strong international natural
gas liquids pricing. Total natural gas liquids sales as of June
2007 were ARS362 million (55% of total revenues), with export
proceeds representing 40% of total revenues, providing a source
of foreign currency to mitigate currency risk. Although non-
regulated, high government interference persisted during the
last three to four years as gas supplies fell short of demand.
natural gas liquids prices are primarily WTI-driven and
consequently the company's cash flow is exposed to price
fluctuations.
Natural gas transportation tariffs are flat since 1999, peso
denominated and further adjustments are no longer automatic.
Moreover, a whole concession contract negotiation is still
pending (including a tariff adjustment). This pending
negotiation is of consideration to reduce regulatory risk.
Although Transportadora Sur maintains adequate access to the
country's major natural gas reserves, natural gas restrictions
is a concern over the medium term. Since 2002, frozen tariff
for gas utilities and low natural gas prices relative to
alternative fuels have resulted in strong growth in the
consumption of natural gas. During the last four years, gas
supplies have not been able to meet demand and natural gas
shortages prevailed during the winter season of 2007.
Transportadora Sur's strategy is to be a lead pipeline operator
and gas-processing producer. To do so, the company continues to
pursue gas contracts in order to minimize gas shortages in the
Cerri plant. Growth opportunities for the gas transportation
business will be determined by the government expansion plans
and financed through financial trusts. Thus, a minimum level of
capital expenditures for system improvement will continue to be
at US$57 million per year.
Credit protection measures are considered strong for the rating
category. Leverage, as measured by total debt to EBTDA, has
steadily declined while cash balances had build up. During the
second quarter of 2007, the company completed a tender offer to
repurchase its existing debt of US$639 million with cash and the
proceeds of a US$500 million senior unsecured note issuance. As
of Nov. 6, 2007, outstanding debt consists of a 10-year US$500
million note at fixed coupon of 7.875%. Going forward, credit
metrics will remain satisfactory and debt maturities are
considered to be manageable even considering a normalized cash
flow from NLG operations and a flat cash flow from gas
transportation. As of June 2007, Transportadora Sur posted a
low leverage level at 2.5 times and FFO interest coverage of
4.0. As presently planned, with capital expenditures at a
minimum level, the company will continue to generate a positive
free cash flow and be able to maintain a considerable financial
flexibility.
Headquartered in Buenos Aires, Argentina, Transportadora de Gas
del Sur SA -- http://www.tgs.com.ar-- is a transporter of
natural gas; having a 7,419-kilometer (4,610 miles) pipeline
system with a firm contracted capacity of 62.5 million cubic
meters per day (MMm3/d) with an installed power of 538.220
horsepower. Substantially all of Transportadora de Gas'
capacity is subscribed for under firm long-term transportation
contracts. Transportadora de Gas is also a processor of natural
gas and marketer of natural gas liquids in Argentina. The
company operates the General Cerri gas processing complex and
the associated Galvan loading and storage facility in Bahia
Blanca in the Buenos Aires Province where natural gas liquids
are separated from gas transported through the company's
pipeline system and stored for delivery. Transportadora de Gas
is engaged in midstream activities and the provision of
telecommunication services in Argentina. The company operates
the largest pipeline transmission system in Argentina, which
accounts for roughly 60% of the country's total natural gas
consumption.
GLOBAL CROSSING: Loses US$89 Million in Third Quarter 2007
----------------------------------------------------------
Global Crossing said in a statement that its net loss increased
75% to US$89 million in the third quarter 2007, compared to
US$51 million in the third quarter 2006.
Business News Americas relates that Global Crossing's revenues
rose 27% to US$594 million in the third quarter of this year,
from US$466 million in the same period last year.
According to BNamericas, Global Crossing completed on
May 9, 2007, its acquisition of corporate services provider
Impsat for US$347 million. Global Crossing expects that full
integration with Impsat will take up to 18 months after closure
of the acquisition.
Global Crossing's revenues this year would be up to US$2.25
billion, BNamericas states.
Headquartered in Florham Park, New Jersey, Global Crossing Ltd.
(NASDAQ: GLBC) -- http://www.globalcrossing.com/-- provides
telecommunication services over the world's first integrated
global IP-based network, which reaches 27 countries and more
than 200 major cities around the globe including Bermuda,
Argentina, Brazil, and the United Kingdom. Global Crossing
serves many of the world's largest corporations, providing a
full range of managed data and voice products and services. The
company filed for chapter 11 protection on Jan. 28, 2002 (Bankr.
S.D.N.Y. Case No. 02-40188). When the Debtors filed for
protection from their creditors, they listed US$25,511,000,000
in total assets and US$15,467,000,000 in total debts. Global
Crossing emerged from chapter 11 on Dec. 9, 2003.
At Dec. 31, 2006, Global Crossing Ltd.'s balance sheet showed a
US$195 million stockholders' deficit, compared to a US$173
million stockholders' deficit at Dec. 31, 2005.
POLYMER GROUP: Plans to Sell 5.5 Million of Class A Common Stock
----------------------------------------------------------------
Polymer Group Inc. and selling stockholders consisting of
MatlinPatterson Global Opportunities Partners L.P. and certain
of its affiliates, propose to sell 5,455,000 shares of the
company's Class A Common Stock, consisting of 3,636,000 shares
proposed to be sold by the company and 1,819,000 shares to be
sold by the selling shareholders.
Polymer Group will not receive any proceeds from the sale of the
shares by the selling stockholders. The company intends to use
the proceeds of the shares sold by the company to repay debt
under its existing senior secured credit facility.
Additionally, the company disclosed that upon the pricing of the
offering, it expects that its Class A Common Stock will be
listed on the New York Stock Exchange and will trade under the
ticker symbol "PGO."
The offering was made through an underwriting syndicate led by
J.P. Morgan Securities Inc. and Citigroup Global Markets Inc.
The other co- managing underwriters are Deutsche Bank Securities
Inc., Robert W. Baird & Co. Incorporated and KeyBanc Capital
Markets Inc.
A copy of the preliminary prospectus relating to this offering
may be obtained from:
J.P. Morgan Securities Inc.
No. 4 Chase Metrotech Center, CS Level
Brooklyn, NY 11245
Tel (718) 242-8002
or
Citigroup Global Markets Inc.
8th Floor, Brooklyn Army Terminal
140 58th Street
Brooklyn, NY 11220
Tel (718) 765- 6732
About Polymer Group Inc.
Polymer Group, Inc., -- http://www.polymergroupinc.com/-- (OTC
Bulletin Board: POLGA/POLGB) develops, manufactures and markets
engineered materials. The company operates 22 manufacturing
facilities in 10 countries throughout the world. The company
has manufacturing offices in Argentina, China and France, among
others.
POLIPROLDUCTOS ARGENTINOS: Claims Verification Is Until Feb. 4
--------------------------------------------------------------
Ernesto Garcia, the court-appointed trustee for Poliproductos
Argentinos SRL's bankruptcy proceeding, verifies creditors'
proofs of claim until Feb. 4, 2007.
Mr. Garcia will present the validated claims in court as
individual reports. The National Commercial Court of First
Instance No. 5 in Buenos Aires, with the assistance of Clerk
No. 9, will determine if the verified claims are admissible,
taking into account the trustee's opinion, and the objections
and challenges that will be raised by Poliproductos Argentinos
and its creditors.
Inadmissible claims may be subject for appeal in a separate
proceeding known as an appeal for reversal.
A general report that contains an audit of Poliproductos
Argentinos' accounting and banking records will be submitted in
court.
Mr. Garcia is also in charge of administering Poliproductos
Argentinos' assets under court supervision and will take part in
their disposal to the extent established by law.
The debtor can be reached at:
Poliproductos Argentinos SRL
Lavalle 1711
Buenos Aires, Argentina
The trustee can be reached at:
Ernesto Garcia
Sarmiento 1587
Buenos Aires, Argentina
PRODUCTOS TEXTILES: Proofs of Claim Verification Ends Feb. 22
-------------------------------------------------------------
Productos Textiles SA -- the court-appointed trustee for Guzmar
S.R.L.'s reorganization proceeding -- verifies creditors' proofs
of claim until Feb. 22, 2008.
Estudio Doctores will present the validated claims in court as
individual reports. The National Commercial Court of First
Instance No. 6 in Buenos Aires, with the assistance of Clerk
No. 11, will determine if the verified claims are admissible,
taking into account the trustee's opinion, and the objections
and challenges that will be raised by Productos Textiles and its
creditors.
Inadmissible claims may be subject for appeal in a separate
proceeding known as an appeal for reversal.
A general report that contains an audit of Productos Textiles'
accounting and banking records will be submitted in court.
La Nacion didn't state the reports submission deadlines.
Creditors will vote to ratify the completed settlement plan
during the assembly on Nov. 10, 2008.
The debtor can be reached at:
Productos Textiles SA
25 de Mayo 168
Buenos Aires, Argentina
The trustee can be reached at:
Estudio Doctores Iglesias, Martinetti y Asociados
Maipu 350
Buenos Aires, Argentina
PROTAM SA: Proofs of Claim Verification Deadline Is Dec. 14
-----------------------------------------------------------
Juan Roque Treppo, the court-appointed trustee for Protam S.A.'s
bankruptcy proceeding, verifies creditors' proofs of claim until
Dec. 14, 2007.
Mr. Treppo will present the validated claims in court as
individual reports. The National Commercial Court of First
Instance in Buenos Aires will determine if the verified claims
are admissible, taking into account the trustee's opinion, and
the objections and challenges that will be raised by Protam and
its creditors.
Inadmissible claims may be subject for appeal in a separate
proceeding known as an appeal for reversal.
A general report that contains an audit of Protam's accounting
and banking records will be submitted in court.
Infobae didn't state the reports submission deadlines.
Mr. Treppo is also in charge of administering Protam's assets
under court supervision and will take part in their disposal to
the extent established by law.
The trustee can be reached at:
Juan Roque Treppo
Sarmiento 1183
Buenos Aires, Argentina
SUCESION DE DAYAN: Seeks for Reorganization Okay in Buenos Aires
----------------------------------------------------------------
Sucesion de Dayan Abraham has requested for reorganization
approval after failing to pay its liabilities since
Aug. 17, 1999.
The reorganization petition, once approved by the court, will
allow Sucesion de Dayan to negotiate a settlement with its
creditors in order to avoid a straight liquidation.
The case is pending in the National Commercial Court of First
Instance No. 3 in Buenos Aires. Clerk No. 5 assist in this
case.
The debtor can be reached at:
Sucesion de Dayan Abraham
Jeronimo Salguero 540, Piso 3 Dto. 10
Buenos Aires, Argentina
UNIMED SA: Proofs of Claim Verification Is Until Feb. 20
--------------------------------------------------------
Gerardo Seghezzo, the court-appointed trustee for Unimed SA's
bankruptcy proceeding, verifies creditors' proofs of claim until
Feb. 20, 2007.
Mr. Seghezzo will present the validated claims in court as
individual reports. The National Commercial Court of First
Instance No. 3 in Buenos Aires, with the assistance of Clerk
No. 6, will determine if the verified claims are admissible,
taking into account the trustee's opinion, and the objections
and challenges that will be raised by Unimed and its creditors.
Inadmissible claims may be subject for appeal in a separate
proceeding known as an appeal for reversal.
A general report that contains an audit of Unimed's accounting
and banking records will be submitted in court.
La Nacion didn't state the reports submission deadlines.
Mr. Seghezzo is also in charge of administering Unimed's assets
under court supervision and will take part in their disposal to
the extent established by law.
The debtor can be reached at:
Unimed SA
Azcuenaga 1049
Buenos Aires, Argentina
The trustee can be reached at:
Gerardo Seghezzo
Combate de los Pozos 129
Buenos Aires, Argentina
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B E R M U D A
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COMPLETE RETREATS: Gram, et al. Wants Adversary Case Dismissed
--------------------------------------------------------------
Bluewater Holding Ltd., Casa Olita Ltd., Espanto Island Resort,
Ltd., Espanto Partners Ltd., Jeffrey Gram, Island Seekers Ltd.,
and Private Island Management Group asked the Court to dismiss
the adversary proceeding initiated by Private Retreats Belize,
LLC.
Judge Schiff denied the dismissal request because the defendants
failed to comply with the Court's contested matter procedure
guidelines.
Judge Schiff later vacated his order at the defendants' request,
to allow the parties to maintain their agreed-upon briefing
schedule.
Representing Private Retreats Belize, LLC, Jeffrey K. Daman,
Esq., at Dechert LLP, in Hartford, Connecticut, noted that Mr.
Gram, Casa Olita, Private Island Management, Espanto Island
Resort, Espanto Partners, Bluewater Holding, and Island Seekers
principally argue that:
(i) certain of the offshore shell companies Mr. Gram formed
to hide the collusive nature of the foreclosure sale and
his involuntary transfers of the Plaintiff's assets are
immune from service of process on Mr. Gram;
(ii) the proceeds of the secret and collusive foreclosure sale
should be deemed reasonably equivalent value under a
misstatement of Supreme Court authority;
(iii) the fortuity of Cayo Espanto's location in Belize makes
Bankruptcy Code remedies inapplicable even though
practically every other aspect of the transactions
complained of are based in the U.S.;
(iv) the Plaintiff is not insolvent despite Mr. Gram
involuntarily transferring the Plaintiff's sole asset;
and
(v) the Plaintiff has not plead with sufficient particularity
to allow the Defendants to know what transactions are
being complained of.
Mr. Daman asserts that the Defendants' motion is without merit
and should be denied in its entirety for these reasons:
(a) The Defendants were properly served;
(b) Private Retreats Belize's avoidance actions have been
validly plead; and
(c) Private Retreats Belize's remaining claims are
sufficiently plead.
Mr. Gram, et al., note that Private Retreats Belize clearly
failed to conduct an investigation before filing its complaint.
Thus, Mr. Carberry says, it is not surprising that Private
Retreats Belize's arguments are unavailing and appear to be
attempts to mask the fact that its complaint is deficient.
Defendants Seek Stay
Mr. Gram, et al., assert that the Court should dismiss the
adversary proceeding based on the doctrine of international
comity. In the alternative, Mr. Gram, et al., contend that the
Court should stay the adversary proceeding pending resolution of
a lawsuit that Private Retreats Belize filed in the Supreme
Court of Belize against Mr. Gram, Espanto Partners, and Espanto
Island Resorts. The Belize Lawsuit is similar to the adversary
proceeding. It seeks to overturn the foreclosure sale of
Belizean real property. Thus, the Belize Lawsuit and the
adversary proceeding represent dueling, parallel lawsuits
seeking essentially the same relief as to the same foreclosure
sale, John F. Carberry, Esq., at Cummings & Lockwood LLC, in
Stamford, Connecticut, pointed out.
Mr. Daman tell the Court that Private Retreats Belize is suing
Mr. Gram and his alter-egos under remedies exclusive to the
Bankruptcy Code for fraudulent conveyances and preferences,
actions under state fraudulent conveyance statutes, and common
law actions for an accounting, breach of various contracts,
conversion, and unjust enrichment. "All of these causes of
action are under American law, and despite [the] Defendants'
hollow argument to the contrary, a determination of Belize law
is entirely unnecessary to [the adversary] proceeding. By
contrast, the Belize proceeding is focused on the narrow issue
of whether the purported foreclosure was conducted in accordance
with Belize law. Therefore, the [adversary proceeding] and [the
proceeding in] Belize are not even parallel, and the Court's
determination can end there," Mr. Daman argued.
Mr. Daman added that the adversary proceeding is further along
than the Belize proceeding, the Belize court has not issued any
decision on the merits or otherwise, and any ruling by the
Belize court would have no res judicata effect in the adversary
proceeding because the issues being litigated are entirely
separate. "Therefore, as Defendants fail to point to a single
authority that would allow [the Bankruptcy] Court to stay [the
adversary] proceeding, the Court should deny [the] Defendants'
request for a stay."
Court Stays Adversary Proceeding
After hearing the arguments and reviewing the pleadings, Judge
Schiff stayed the adversary proceeding pending resolution of the
Belize Action without prejudice to Private Retreats Belize's
right to move to vacate or lift the stay.
Plaintiff Wants to File Appeal
Private Retreats Belize complains that the Court did not issue a
formal opinion regarding its resolution of the Motion to Abstain
and the entry of the Stay Order. Moreover, the Bankruptcy Court
did not articulate on the record the basis, support, or
authority for its decision to stay the Adversary Proceeding, and
a review of the transcript from the hearing does not provide
that information.
Private Retreats Belize asks the U.S. District Court for the
District of Connecticut for permission to appeal the Stay Order
so that the Stay Order may be reversed and the adversary
proceeding remanded to the Bankruptcy Court for further
proceedings on the merits.
Private Retreats Belize relates that the questions to be
presented to the District Court on appeal are:
1. Did the Bankruptcy Court abuse its discretion by failing
to consider whether the Adversary Proceeding and the
Belize Lawsuit are "parallel proceedings"?
2. Did the Bankruptcy Court abuse its discretion by failing
to consider any of the factors espoused by the Second
Circuit when weighing whether staying a "parallel
proceeding" is appropriate under international comity
grounds?
3. Did the Bankruptcy Court abuse its discretion by issuing
the Stay Order despite the relevant factors weighing in
favor of the Bankruptcy Court exercising its jurisdiction?
Mr. Daman tells the District Court that in October 2006, Private
Retreats Belize filed a claim in the Supreme Court of Belize.
Mr. Daman notes that the Adversary Proceeding complains of
conduct much broader than the narrow issue the Belize Claim is
focused on. "The Belize courts are being asked to rule that the
Purported Foreclosure was fraudulent under local Belize law,
seeking to exercise [the] Plaintiff's equity of redemption, and
seeking an inquiry as to damages suffered by Plaintiff as a
result of [Mr.] Gram's operation, management and sale of Cayo
Espanto. In contrast, [the Bankruptcy] Court is the only court
being asking to determine whether [Mr.] Gram's transfers . . .
were fraudulent and/or preferential under [Sections 547 and 548
of] Bankruptcy Code."
Also, Mr. Daman continues, the Bankruptcy Court is the only
court considering the Plaintiff's common law claims for breach
of the Management Agreement, breach of the Lease, conversion of
the Plaintiff's personal property, unjust enrichment, and for an
accounting as required under the Management Agreement.
"Therefore, upon resolution of the Belize Claim, the Adversary
Proceeding will immediately resume no matter what the Belize
court's ruling on whether the Purported Foreclosure comported
with local Belize law."
Mr. Daman asserts that an immediate appeal from the stay will
materially advance the ultimate termination of the litigation.
Additionally, he says, the appeal presents exceptional
circumstances that justify appellate review prior to the entry
of a final judgment.
Mr. Gram, Et Al., Object
Mr. Carberry contends that Private Retreats Belize's request is
fatally flawed because it seeks interlocutory review of a
discretionary ruling involving settled law on the basis that the
bankruptcy court incorrectly applied the facts to the law. "To
make matters even worse, the Motion largely ignored the required
elements for an interlocutory review."
Mr. Carberry notes that Private Retreats Belize cannot satisfy
any of the elements required for an interlocutory review. Mr.
Carberry points out that the questions presented are not
"questions of law" because:
(i) they would require the District Court to engage in a
factual analysis; and
(ii) as Private Retreats has acknowledged, the questions
presented would be reviewed under an abuse of
discretion standard rather than a de novo standard.
Assuming that the questions presented are "questions of law,"
Mr. Carberry says, there is not a "substantial ground for
difference of opinion" because the questions are governed by
settled law and they are not difficult or pivotal. Once again,
assuming that the questions presented are "questions of law" --
which they clearly are not -- they are not "controlling" because
the bankruptcy court could have based its ruling on its own
inherent authority to control its own docket rather than
international comity of the courts, Mr. Carberry adds.
Mr. Carberry argues that an immediate appeal from the Stay Order
would not "materially advance the ultimate termination of the
litigation" and instead would complicate rather than expedite
the litigation. In addition, he says, there are no "exceptional
circumstances," which justify an interlocutory review of the
Stay Order.
Complete Retreats, LLC, Preferred Retreats, LLC, and their
subsidiaries were founded in 1998. Owned by Robert McGrath and
four minority owners, the companies operate a five-star
hospitality and real estate management business and are a
pioneer and market leader of the "destination club" industry.
Under the trade name "Tanner & Haley Resorts," Complete
Retreats, et al.'s destination clubs have numerous individual
and company members.
Destination club members pay up-front membership deposits,
annual dues, and daily usage fees. In return, members and their
guests enjoy the use of first-class private residences, and
receive an array of luxurious services and amenities in certain
exotic vacation destinations in the United States and locations
around the world, including: Abaco, Bahamas; Cabo San Lucas,
Mexico; Nevis, West Indies; Telluride, Colorado; and Jackson
Hole, Wyoming.
Complete Retreats and its debtor-affiliates filed for chapter 11
protection on July 23, 2006 (Bankr. D. Conn. Case No. 06-50245
through 06-50306). Nicholas H. Mancuso, Esq., Jeffrey K. Daman,
Esq., Joel H. Levitin, Esq., David C. McGrail, Esq., Richard A.
Stieglitz Jr., Esq., at Dechert LLP, are representing the
Debtors in their restructuring efforts. Xroads Solutions Group,
LLC, is the Debtors financial and restructuring advisor. When
the Debtors filed for chapter 11 protection, they listed total
debts of US$308,000,000. (Complete Retreats Bankruptcy News,
Issue No. 35; Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
COMPLETE RETREATS: Wants Multihull Settlement Approved
------------------------------------------------------
Complete Retreats and its debtor-affiliates ask the U.S.
Bankruptcy Court for the District of Connecticut to approve
their settlement agreement with Multihull Company Luxury
Catamaran Charters, LLC.
On March 23, 2006, Multihull and Debtor Private Retreats
Tortolla, LLC, entered into a sailing program agreement whereby
Multihull provided the Debtors certain specified charter boat
services.
On Nov. 22, 2006, Multihull filed Claim No. 1333 against Debtor
Preferred Retreats, LLC, asserting an unliquidated general
unsecured claim related to the Sailing Program Agreement, which
was estimated to be US$745,000.
On December 11, 2006, Multihull filed Claim No. 1803 against
Private Retreats Tortolla also asserting an unliquidated general
unsecured claim related to the Sailing Program Agreement, which
was estimated to be US$745,000.
The Debtors and Multihull entered into a settlement agreement to
resolve all issues alleged in and related to the claims.
The material terms of the Settlement Agreement are:
(a) Claim No. 1333 will be deemed an allowed general
unsecured claim against Preferred Retreats for
US$845,000, and Multihull would have no other or further
claims or rights to recovery against the Debtors and
their estates.
(b) In consideration for the Settlement Amount, Multihull
would not object to confirmation of the Plan.
(c) Except for the Settlement Amount, the Debtors and
Multihull would provide and receive complete, mutual
releases.
Complete Retreats, LLC, Preferred Retreats, LLC, and their
subsidiaries were founded in 1998. Owned by Robert McGrath and
four minority owners, the companies operate a five-star
hospitality and real estate management business and are a
pioneer and market leader of the "destination club" industry.
Under the trade name "Tanner & Haley Resorts," Complete
Retreats, et al.'s destination clubs have numerous individual
and company members.
Destination club members pay up-front membership deposits,
annual dues, and daily usage fees. In return, members and their
guests enjoy the use of first-class private residences, and
receive an array of luxurious services and amenities in certain
exotic vacation destinations in the United States and locations
around the world, including: Abaco, Bahamas; Cabo San Lucas,
Mexico; Nevis, West Indies; Telluride, Colorado; and Jackson
Hole, Wyoming.
Complete Retreats and its debtor-affiliates filed for chapter 11
protection on July 23, 2006 (Bankr. D. Conn. Case No. 06-50245
through 06-50306). Nicholas H. Mancuso, Esq., Jeffrey K. Daman,
Esq., Joel H. Levitin, Esq., David C. McGrail, Esq., Richard A.
Stieglitz Jr., Esq., at Dechert LLP, are representing the
Debtors in their restructuring efforts. Xroads Solutions Group,
LLC, is the Debtors financial and restructuring advisor. When
the Debtors filed for chapter 11 protection, they listed total
debts of US$308,000,000. (Complete Retreats Bankruptcy News,
Issue No.35; Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000).
WR GRACE: Asbestos PI Committee & FCR File Reorganization Plan
--------------------------------------------------------------
The Official Committee of Asbestos Personal Injury Claimants and
David T. Austern, the Court-appointed future claims
representative, delivered to the U.S. Bankruptcy Court for the
District of Delaware on Nov. 5, 2007, a joint plan of
reorganization for W.R. Grace & Co. and its 61 debtor-
affiliates.
The PI/FCR Plan provides for the creation of an asbestos trust
to which all of the asbestos personal injury claims against the
Debtors will be channeled and resolved. The Asbestos Trust will
be funded by the Sealed Air Payment, which will consist of:
-- US$512.5 million in cash, plus interest accrued from
Dec. 21, 2002, until the effective date of the Plan, at a
rate of 5.5% per annum compounded annually; and
-- 18 million shares of Sealed Air Common Stock, as adjusted
for a two-for-one stock split in March 2007.
The Sealed Air Payment stems from a settlement agreement,
approved by the Court on June 27, 2005, resolving certain
fraudulent transfer claims asserted by the Debtors and Sealed
Air Corporation.
The PI/FCR Plan will become effective only after the Court has
found that the Debtors' aggregate liability for all existing and
future asbestos PI Claims and Demands will be at least
US$4 billion, pursuant to a final Court order.
To recall, the Debtors filed a joint plan of reorganization and
disclosure statement on Nov. 13, 2004, and amended that Plan on
Jan. 13, 2005. A condition to the confirmation of the
Debtors' Plan was for the Court to find that the Debtors'
maximum aggregate payment for all asbestos-related liabilities
and trust administrative costs and expenses will not exceed
US$1.6 billion.
Estate Consolidation
The PI/FCR Plan provides that, subject to the occurrence of the
Effective Date, the Debtors will be deemed consolidated for Plan
purposes only. Each and every claim filed or to be filed
against the Debtors will be deemed filed against the deemed
consolidated Debtors and will be deemed one Claim against and
obligation of the deemed consolidated Debtors.
The deemed consolidation, however, will not affect:
-- the Debtors' legal and organizational structure;
-- any Encumbrances that are required to be maintained under
the PI/FCR Plan in connection with executory contracts
and unexpired leases that were entered during the
Debtors' Chapter 11 cases or that have been or will be
assumed pursuant to the Plan or in connection with any
exit financing;
-- the Sealed Air Settlement Agreement; and
-- the settlement agreement between the Debtors and
Fresenius Medical Care Holdings, Inc.
Consolidation of the Debtors will not have any effect on any
Plan Claims being reinstated and left unimpaired under the
PI/FCR Plan; and the legal, equitable, and contractual rights to
which the holders of any Plan Claims are entitled will be left
unaltered by the Plan.
Injunction and Discharge Provisions
On the Effective Date, all Asbestos Personal Injury and Personal
Damage Claimholders, and all entities that have asserted claims
against any insurance company that has issued asbestos insurance
policies to the Debtors, are enjoined from taking any action for
the purpose of collecting, recovering, or receiving payments,
satisfaction, or recovery on account of those Claims, including:
(a) commencing, conducting, or continuing any lawsuit in any
forum against any Asbestos Protected Party or any of
their properties and interests;
(b) enforcing, levying, attaching, collecting, or otherwise
recovering by any means, any judgment or award against
any Entity released under any provision of the PI/FCR
Plan;
(c) creating, perfecting, or otherwise enforcing any
Encumbrance against any Entity released under any
provision of the PI/FCR Plan; and
(d) setting off, seeking reimbursement of, indemnification
or contribution from, or subrogation against any Entity
released under any provision of the PI/FCR Plan.
The Asbestos Protected Party includes the Debtors, the
Reorganized Debtors, the Non-Debtor Affiliates, the Resolved
Asbestos Insurance Companies, the Sealed Air and Fresenius
Indemnified Parties, the Settled Asbestos Insurance Companies,
and their representatives.
Employee Compensation
All of the Debtors' obligations under employment and severance
contracts and policies; and all compensation and benefit plans,
policies, and programs will be treated as though they are
executory contracts that are deemed assumed under the PI/FCR
Plan.
Dissolution of Committees
On the Effective Date, the PI Committee, the Official Committee
of Asbestos Property Damage Claimants, the Official Committee of
Unsecured Creditors, and the Official Committee of Equity
Security Holders will be dissolved. The Debtors will continue
to retain the FCR.
A full-text copy of the PI/FCR Plan is available for free at
http://ResearchArchives.com/t/s?2504
A full-text copy of the Glossary of Terms of the PI/FCR Plan is
available for free at http://ResearchArchives.com/t/s?2505
About W.R. Grace
Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA)
-- http://www.grace.com/-- supplies catalysts and silica
products, especially construction chemicals and building
materials, and container products globally, including
Argentina, Australia and Ireland.
The Company and its debtor-affiliates filed for chapter 11
protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139).
David M. Bernick, Esq., at Kirkland & Ellis, LLP, and Laura
Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP,
represent the Debtors in their restructuring efforts. The
Debtors hired Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant.
Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent
the Official Committee of Unsecured Creditors. The Creditors
Committee tapped Capstone Corporate Recovery LLC for financial
advice. David T. Austern, the legal representative of future
asbestos personal injury claimants, is represented by Orrick
Herrington & Sutcliffe LLP and Phillips Goldman & Spence,
Pennsylvania. Elihu Inselbuch, Esq., at Caplin & Drysdale,
Chartered, and Marla R. Eskin, Esq., at Campbell & Levine, LLC,
represent the Official Committee of Asbestos Personal Injury
Claimants. The Asbestos Committee of Property Damage Claimants
tapped Martin W. Dies, III, Esq., at Dies & Hile L.L.P., and C.
Alan Runyan, Esq., at Speights & Runyan,to represent it.
Lexecon, LLC, provided asbestos claims consulting services to
the Official Committee of Equity Security Holders.
The Debtors' filed their Chapter 11 Plan and Disclosure
Statement on Nov. 13, 2004. On Jan. 13, 2005, they filed an
Amended Plan and Disclosure Statement. The hearing to consider
the adequacy of the Debtors' Disclosure Statement began on
Jan. 21, 2005. The Debtors' exclusive period to file a chapter
11 plan expired on July 23, 2007.
Estimation of W.R. Grace's asbestos personal injury liabilities
will commence on Jan. 14, 2008. (W.R. Grace Bankruptcy News,
Issue No. 143; Bankruptcy Creditors' Service, Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
===========
B R A Z I L
===========
AUTOCAM CORP: S&P Withdraws B Corporate Credit Rating
-----------------------------------------------------
Standard & Poor's Ratings Services has withdrawn its 'B'
corporate credit rating on Kentwood, Michigan-based Autocam
Corp. At the same time, S&P withdrew its 'B+' rating on
Autocam's senior secured credit facilities. The ratings were
withdrawn at the company's request.
Autocam Corporation, headquartered in Kentwood, Michigan, is a
manufacturer of extremely close tolerance precision-machined,
metal alloy components, sub-assemblies, primarily for
performance and safety critical automotive applications.
Revenues in 2005 were approximately US$350 million from
operations in North America, Europe and Brazil.
BANCO NACIONAL: Approves BRL1.5-Million Financing to Arco-Iris
--------------------------------------------------------------
Banco Nacional de Desenvolvimento Economico e Social aka BNDES
approved a BRL1.5 million financing to Arco-Iris Ltda, for the
construction of a multiplex complex with five rooms for the
projection of cinematographic works at Shopping Center Itaguacu,
located in the municipality of Sao Jose, metropolitan region of
Florianopolis. BNDES participation represents 73% of the
investment.
The complex of rooms has total capacity of 1,340 seats in the
form of a stadium (bleachers that enable ample and clear screen
view). The rooms will have last generation projectors and
digital Dolby sound. The project will include ample space where
clients will be waiting for exhibitions to start.
The physical structure (shell) was built by Shopping Itaguacu.
Arco-Iris was in charge of coating, fixtures (air-conditioning,
electrical, hydraulic and fire prevention), acquisition of
furniture and equipment, which are part of this project.
The company already has three rooms in the shopping, but with
capacity for only 710 seats. The existing rooms do not follow
the multiplex pattern and are physically apart.
The five new rooms are located in the shopping center expansion
area. The new complex will represent an 89% increase as
compared to the current capacity of Arco-Iris rooms at Shopping
Itagua‡u and 6% of company capacity. The new rooms shall have
the following capacities: room 1 (200 seats); room 2 (212
seats); room 3 (212 seats); room 4 (302 seats); room 5 (410
seats).
The three Arco-Iris movie rooms in operation at Shopping
Itaguacu have 14 direct employees. With the construction of the
new complex, an increase of around 30% of complex job posts is
foreseen.
The first movie room owned by the founding partners of Empresa
de Cinemas Arco-Iris Ltda. was inaugurated in 1961. Throughout
the years, the partners have expanded their activities. Arco-
Iris currently runs 99 movie rooms under the Arco-Iris brand in
the Country, located in 30 cities, distributed in five states
(Rio Grande do Sul, Parana, Santa Catarina, Sao Paulo and Ceara)
and in the Federal District.
Banco Nacional de Desenvolvimento Economico e Social is Brazil's
national development bank. It provides financing for projects
within Brazil and plays a major role in the privatization
programs undertaken by the federal government.
* * *
Banco Nacional currently carries a Ba2 foreign long-term bank
deposit rating from Moody's, and a BB+ long-term foreign issuer
credit rating from Standards and Poor's. The ratings were
assigned in August and May 2007, respectively.
BANCO NACIONAL: Forming Technological Center with Companhia Vale
----------------------------------------------------------------
Banco Nacional de Desenvolvimento Economico e Social will create
with Companhia Vale do Rio Doce a technological development
center for energy initiatives, Companhia Vale said in a
statement.
Business News Americas relates that the center will be in Sao
Jose dos Campos, Sao Paulo. Investments for the project would
start at BRL220 million over a three-year period. The project
will "emphasize environmentally sustainable energy generation
and the use of renewable sources of energy." The center will
conduct an extensive research and development program of
processes and systems on energy generation.
According to Companhia Vale's statement, technologies that the
center will develop would guarantee future energy supply so the
firm can carry out its US$59-billion investment plan for the
2008-12 period in Brazil and all over the world.
The center would begin operating in the first half of 2008,
BNamericas notes.
Companhia Vale Chief Executive Officer Roger Agnelli said in a
Web cast, "Energy is a challenge for everyone, in terms of how
to generate and use it while preserving the environment."
BNamericas relates that in power-related activities, Companhia
Vale has seven large-scale hydroelectric plants in operations,
one plant under construction, one project at the stage of
securing environmental licenses, and four small-scale
hydroelectric units.
Companhia Vale's executive director of planning and business
development Gabriel Stoliar said in a Web cast, "The idea of the
center is to develop technologies according to specific needs.
The partnership [between CVRD and BNDES] is 50:50 for now."
About Companhia Vale
Headquartered in Rio de Janeiro, Brazil, Companhia Vale do Rio
Doce -- http://www.cvrd.com.br/-- engages primarily in mining
and logistics businesses. It engages in iron ore mining, pellet
production, manganese ore mining, and ferroalloy production, as
well as in the production of nonferrous minerals, such as
kaolin, potash, copper, and gold.
About Banco Nacional
Banco Nacional de Desenvolvimento Economico e Social is Brazil's
national development bank. It provides financing for projects
within Brazil and plays a major role in the privatization
programs undertaken by the federal government.
* * *
Banco Nacional currently carries a Ba2 foreign long-term bank
deposit rating from Moody's, and a BB+ long-term foreign issuer
credit rating from Standards and Poor's. The ratings were
assigned in August and May 2007, respectively.
COSAN SA: Reports Tender Offer & Consent Solicitation Results
-------------------------------------------------------------
Cosan S.A. Industria e Comercio has announced results of its
previously cash tender offer and consent solicitation relating
to its 9.00% Senior Notes due 2009 conducted in accordance with
the company's Offer to Purchase and Consent Solicitation
Statement, dated Oct. 9, 2007, which expired at Midnight, New
York City time, on Nov. 5, 2007.
As of the Nov. 5, 2007, the company had received tenders and
consents in respect of US$169,732,000 in aggregate principal
amount of the Notes, representing approximately 84.87% of the
aggregate principal amount of the outstanding Notes. Out of
this total aggregate principal amount of Notes, US$164,192,000
consisted of Notes tendered and US$5,540,000 consisted of
consents from holders of Notes that did not tender their Notes.
Accordingly, the company has obtained the requisite consents to
the proposed amendments to the tendered Notes and the indenture
governing the notes, described in more detail in the Offer to
Purchase, from the holders of at least 66 2/3% in aggregate
principal amount of the outstanding Notes.
The total consideration for each US$1,000 principal amount of
Notes validly tendered and not validly withdrawn prior to 5:00
p.m., New York City time, on Oct. 22, 2007 and accepted for
payment is US$1,088.74, plus accrued interest to but excluding
the applicable settlement date. This amount includes a consent
fee of US$10.00. The total consideration was determined by
reference to a fixed spread of 50 basis points over the yield on
the 3.375% United States Treasury Notes due Oct. 15, 2009, which
was determined at 2:00 p.m., New York City time, on
Oct. 22, 2007. The reference yield and the tender offer yield
are 3.855% and 4.355%, respectively. For Notes tendered after
Oct. 22, 2007 and prior to the Nov. 5, 2007, the tender offer
consideration will be US$1,078.74 for each US$1,000 principal
amount of Notes validly tendered and not validly withdrawn and
accepted for payment, plus accrued interest to the applicable
settlement date.
Morgan Stanley & Co. Incorporated is acting as Dealer Manager
for the Tender Offer and as Solicitation Agent for the Consent
Solicitation. Persons with questions regarding the Tender Offer
or the Consent Solicitation should be directed to Morgan Stanley
toll-free at (800) 624-1808 or collect at (212) 761-5384
(attention: Tate Forrester). Requests for documents should be
directed to the Information Agent, Global Bondholder Services
Corporation, toll-free at (866) 952-2200 or at (212) 430-3774.
About Cosan
Headquartered in Sao Paulo, Brazil, Cosan S.A. Industria e
Comercio, is the third largest sugar producer in the world. In
2004/2005 it crushed more than 26 million tons of sugar cane in
fourteen mills located in the Central South region of Brazil,
with sugar sales of 2.3 million tons and ethanol sales of 825
million liters.
* * *
As of February 2007, Cosan carries Moody's Ba2 global local
currency and foreign currency ratings and Standard and Poor's BB
corporate credit rating.
DELPHI CORP: Equity Panel Balks at Disclosure Statement Changes
---------------------------------------------------------------
The Official Committee of Equity Security Holders of Delphi
Corporation and its debtor-affiliates submitted an emergency
motion with the U.S. Bankruptcy Court for the Southern District
of New York to adjourn the hearing scheduled on Nov. 8, 2007, to
a later date, on, and fix a new time to object to,
(i) the Debtors' request for approval of the Disclosure
Statement,
(ii) the proposed procedures for soliciting votes on the
Plan, and
(iii) the proposed amendment to the Delphi-Appaloosa Equity
Purchase and Commitment Agreement.
As reported in the yesterday's Troubled Company Reporter, Delphi
Corp. asked the Court to adjourn until "later this month" the
hearing currently scheduled for Nov. 8 to consider potential
amendments to its Joint Plan of Reorganization and related
Disclosure Statement as well as a proposed amendment to its
Investment Agreement.
Delphi continues to expect that it will emerge from Chapter 11
during the first quarter of 2008.
Bonnie Steingart, Esq., at Fried, Frank, Harris, Shriver
& Jacobson LLP, in New York, noted that on Oct. 29, 2007,
under the guise of filing "amendments," the Debtors jettisoned
the Plan and Disclosure Statement filed on Sept. 6, 2007. The
new October plan and October disclosure statement, he notes,
materially modify, among other things,
(i) the Debtors' total enterprise value by approximately
US$900 million;
(ii) the total enterprise value on which the purchase price
for the plan investors is based by US$1 billion;
(iii) the ownership structure of reorganized Delphi;
(iv) the capital structure of reorganized Delphi;
(v) the nature and amount of distributions to each major
stakeholder class (other than, notably, the parties with
claims pursuant to the MDL settlements); and
(vi) the rights offering and warrants described in the
September Plan and September Disclosure Statement.
Ms. Steingart points out that the magnitude of the changes in
recoveries and structure results in a new Chapter 11 plan that:
(1) eschews the Delphi-Appaloosa Equity Purchase and
Commitment Agreement approved by the Court on August 2,
2007;
(2) is not consensual;
(3) amounts to a massive shift in value being distributed to
stakeholders; and
(4) changes the financial underpinnings of the September
Plan.
Thus, whether viewed in form or substance the magnitude of the
changes are enormous, Ms. Steingart asserts. She pointed out
there are approximately 340 pages of changed and new disclosure.
Ms. Steingart noted that the Debtors, in asking the Court on
Sept. 27, 2007, and again on Oct. 3, 2007, to continue the
hearing on the September Disclosure Statement, represented to
the Court that only "laser-like" changes to the September Plan
would be forthcoming. However, the changes the Debtors propose
are far from "laser-like," drastically modifying stakeholder
recoveries and the structure of distributions under the
September Plan, as well as give rise to numerous disclosure and
confirmation objections.
Ms. Steingart recounted that since the adjournment of the
Oct. 3, 2007 Disclosure Statement Hearing, the Debtors have
met with their stakeholders on several occasions. During
these meetings and discussions, many of which the Equity
Committee was excluded from participating in, apparently the
Debtors completely abandoned the consensual deal and yielded
to pressure exerted by the ad hoc committee of bondholders,
the Official Committee of Unsecured Creditors and the Plan
Investors. During this period the Equity Committee received
draft term sheets, which reflected continuing diminution of
recoveries for equity. The end result has been changes to
recoveries that are so profound they can only be described as a
new Chapter 11 plan. The recovery to equity holders as a
practical matter has been eviscerated.
Specifically, Ms. Steingart detailed, the distribution of
primary equity has been eliminated, the warrants have changed
from a five-year to a six-month duration, and equity's
participation in the discount rights offering has been
eliminated and the entire participation is now given to
unsecured creditors. To add insult to injury, the New Plan, she
said, also incorporates a "death trap" provision with respect to
the proposed meager recovery to equity holders. In addition,
certain unsecured creditors are receiving a recovery that is
greater than the amount of their claims, which is disguised by a
manipulation of the Debtors'
total enterprise value.
Ms. Steingart also noted that:
-- the Plan Investors have renegotiated their deal and are
now receiving significantly more for their investment
under the New EPCA than what was agreed to in the
Current EPCA. This is true even though the Plan
Investors, who received significant fees to date for
their "commitment," remain bound by the Current EPCA,
which is still in place and has not been terminated.
Furthermore, there is a total lack of transparency as to
why the Debtors have sought to alter drastically the
consensual deal.
-- It appears that management was negotiating its
compensation and incentive plans with the Plan Investors
and the Creditors Committee at the same time they were
allowing the renegotiation of the terms of the Plan and
the EPCA. The New Disclosure Statement provides plans
and programs under which emergence bonuses for
executives alone are far in excess of the recoveries now
proposed for equity.
Ms. Steingart asserts that in any event, due process mandates
that parties be provided at least 25 days to evaluate the New
Disclosure Statement, as required by Rules 2002(b) and 3017(a)
of the Federal Rules of Bankruptcy Procedure. As much as the
Debtors may desire, they are not entitled to require creditors
and equity holders to analyze and evaluate the New Disclosure
Statement and formulate appropriate objections in four days, she
contends.
Bankruptcy Rule 2002(b) requires that parties-in-interest be
given 25 days' notice of "the time fixed for filing objections
and the hearing to consider approval of a disclosure statement"
while Bankruptcy Rule 3017(a) provides that the court will hold
a hearing to consider approval of the Disclosure Statement on 25
days' notice.
Thus, to protect the integrity of the Chapter 11 process, the
Equity Committee asks the Court to require the Debtors to comply
with the notice and hearing requirements of Bankruptcy Rules
2002(b) and 3017(a).
This will ensure that all parties in interest have ample
opportunity to evaluate the implications of the New Plan and the
adequacy of the disclosures in the New Disclosure Statement with
respect to the new structure, Ms. Steingart asserts.
Brandes Investment Partners, L.P., a registered investment
advisory firm that provides investment advisory services, echoed
the Equity Committee's calls for an adjournment of the
Disclosure Statement Hearing.
Brandes Investment, which currently has under management almost
4% of the issued and outstanding shares of Delphi, agrees with
the Equity Committee's position that given the significant
revisions from the Original Plan and the impact the substantive
rights and recoveries of the Debtors' stakeholders, the Debtors
have now put forth in their 11-hour filing is, in effect, a
completely new plan. In view of these changes, the Debtors
should be required to comply with the notice and hearing
requirements and adjourn the Disclosure Statement Hearing,
Brandes maintains.
Equity Committee Wants
New Disclosure Statement Denied
As required by Section 1125(a)(1) of the Bankruptcy Code, a
Chapter 11 disclosure statement must contain information
sufficient to enable holders of claims and interests in the
debtor's estates to make an informed judgment on the plan.
Despite the many economic and structural changes in the Debtors'
proposed plan, which affect virtually every one of the Debtors'
constituencies, the New Disclosure Statement does not provide
information critical to the ability of the Debtors' stakeholders
to make an informed judgment to vote to accept or reject the New
Plan, Ms. Steingart asserts. Moreover, she notes, the proposed
plan is unconfirmable as a matter of law.
In that light, the Equity Committee asks the Court to deny
approval of the proposed amended Disclosure Statement filed on
Oct. 29, 2007.
As previously reported, the Equity Committee supported the Plan
and Disclosure Statement filed on Sept. 6, 2007, which was based
upon a consensual deal reached with stakeholders in the Chapter
11 cases. However, the Equity Committee notes that the
documents submitted by the Debtors on Oct. 29 provides for a
virtually unrecognizable revised plan of reorganization and
disclosure statement that reflects a complete re-trade of the
consensual deal memorialized in the Original Plan.
Ms. Steingart avers that this re-trade, on information and
belief, was instigated by groups who are using the tightening in
the credit markets and certain minor short term inventory
adjustments related to General Motors Corp. as a pretext for
demanding more value for themselves, at the expense of existing
equity.
According to Ms. Steingart, the tightening of the credit markets
was hardly an unforeseen subsequent event; to the contrary,
reports of decreased credit capacity date back to the mid-July
2007 timeframe, almost two months prior to the filing of the
Original Plan and Original Disclosure Statement on Sept. 6.
Similarly, she notes, forecasts relating to North American
automotive production levels were announced prior to the time
the Original Disclosure Statement was filed and by their own
admission the Debtors characterized such information as
overstated.
The Debtors, according to Ms. Steingart, nonetheless facilitated
this improper and unwarranted re-trade by, among other things:
* excluding the Equity Committee from the critical
negotiation sessions at which the New Plan was
formulated, and only "inviting" them back to the table
after existing equity's recoveries had already been
gutted;
* acceding to the demands of unsecured creditors that they
be given the right (allocated to existing equity under
the Original Plan) to participate in a discount equity
offering that was intended to be a significant source of
value for existing equity;
* agreeing to replace equity holders' previously agreed
recoveries with "rights" with de minimus value to
monetize portions of other stakeholders' primary
distributions of new common stock; and
* permitting the Plan Investors, led by Appaloosa
Management, L.P., to renegotiate their contractual
commitment to invest in the reorganized Debtors,
effectively creating a windfall of value for their
investment.
Ms. Steingart asserts that the New Disclosure Statement does not
contain sufficient disclosure as to:
A. The reasons why the Debtors determined it necessary and in
the best interest of stakeholders to renegotiate the fully
consensual agreement embodied in the Original Plan or the
basis for the changes underlying the New Plan.
The New Disclosure Statement provides no rational basis
for the Debtors' significant downward adjustment of its
total enterprise value, approximately US$900,000,000, and
the subsequent shifting of value from equity holders to
unsecured creditors and to the Plan Investors.
The New Disclosure Statement's vague references to
"lowered projections" and "changes in the Business Plan"
provide no such explanation because the changes in the
Business Plan consist of reduced EBITDAR projections for
a single year of the Debtors' four year business plan,
with increases in projected cash flows for the entire
2008 through 2011 period due to the New Plan's changes
in the reorganized Debtors' capital structure and the
reduction of its debt burden. These changes neither
justify nor explain the virtual elimination of an
estimated US$470 million of value to equity holders.
B. Any reasonable justification for the Debtors' allowing the
Plan Investors and others to escape their commitments to
the terms of the Original Plan as set forth in the EPCA
approved by the Court on Aug. 2, 2007.
The EPCA has not been terminated and remains in full
force. Thus, it appears that the Debtors made the
fundamental changes embodied in the New Plan, with its
effective elimination of the ability of existing equity
holders to realize any meaningful value from the
Debtors' reorganization, simply because the Plan
Investors and others allied with the Plan Investors
demanded that they do so. The absence of justification
is especially egregious since the Plan Investors were
awarded and paid substantial fees and break up
protections in exchange for their commitment to the deal
embodied in the Original Plan.
C. Additional material information about the New Plan to which
the Debtors' stakeholders, including existing equity, must
have in order to make an informed decision with respect to
the New Plan.
For instance, one of the Debtors' most significant
assets is its affirmative claims against and defenses to
claims by GM. It is the proposed settlement of these
claims that has enabled the Debtors to reach its
transformation agreements with GM and various unions,
formulate a Chapter 11 plan and propose to pay creditors
in full on their allowed claims. This value from GM
appropriately provided the source of the recovery to
equity under the Original Plan. Yet, despite the
importance of the GM claims and the settlement thereof,
the New Disclosure Statement's assessment of the claims
falls well short of what is needed to make an informed
judgment as to the merits and reasonableness of the
settlement.
Ms. Steingart also asserts that the New Disclosure Statement
must not be approved because it relates to a plan that is
patently unconfirmable. He cites, among other things:
* The New Plan Impermissibly Provides Senior Unsecured
Creditors With More Than Par-Plus-Accrued Recovery.
Under the New Plan, all unsecured creditors will receive
a 100% recovery, but instead of a combination of cash
and primary equity at a plan value of US$45 per share,
senior unsecured creditors will receive a distribution
of primary equity at a New Plan value of $41.58, plus
rights to acquire additional equity shares at US$34.98, a
significant discount to the New Plan value of US$41.58.
However, the equity distributions to GM under the New
Plan remain based on the total enterprise value set
forth in the Original Plan of US$45 per share. Assuming
a
consistent plan value of US$45 per share for all
distributions to all stakeholders, under the New Plan,
senior unsecured creditors are to receive more than
their allowed claims -- a recovery that is strictly
prohibited by Section 1129(b)(2)(B) of the Bankruptcy
Code.
* The GM Settlement, a Cornerstone of the New Plan and the
Basis for Recoveries, is Not Reasonable or Appropriate.
The GM Settlement is not reasonable and in the best
interests of the Debtors' estates because it does not
provide for an equitable allocation of value. Current
equity holders are not receiving sufficient value from
the GM Settlement in exchange for releases of claims
against GM, which have value in the billions of dollars;
the GM Claims cannot be released by equity in exchange
for US$69 million of very short-term securities.
* The New Plan Impermissibly Provides for Post-Petition
Interest on Creditors Claims.
As a general rule, unsecured creditors are not entitled to
postpetition interest unless the debtors can demonstrate it is
required under either the best interest test set forth in
Section 1129(a)(7)(ii) of the Bankruptcy Code or the fair and
equitable test set forth in Section 1129(b)(1). The New Plan
provisions for postpetition interest cannot be justified under
both tests.
* The Treatment of the Section 510(b) Equity Claims under the
New Plan Violates the Bankruptcy Code
Under the MDL Settlement and pursuant to the New Plan,
the Securities Class and ERISA Class would receive, in
the aggregate, in addition to insurance proceeds and
certain other payments, an allowed claim and interest
totaling US$204 million, which claims is to be paid in
the same plan currency that will be distributed to
general unsecured creditors. By this treatment under the
New Plan, these claims by recipients of the MDL
Settlement, claims arising out of the purchase or sale of
equity securities would be placed in a class senior to
equity, when at best they should be pari passu with
equity pursuant to Section 510(b) of the Bankruptcy Code.
Lead Plaintiffs: Some Issues Remain Unresolved
The lead plaintiffs in the consolidated securities class action
entitled In re Delphi Corp. Securities Litigation, Master Case
No. 05-md-1725 (GER) (E.D.Mich.), which previously agreed to,
among other things, a US$204 million general unsecured claim to
settle its lawsuit against the Debtors, say that they are still
discussing with the Debtors their concerns based upon the
current versions of, and the proposed revisions to, the Plan and
Disclosure Statement.
The Debtors on Oct. 29, 2007, said they will modify the Plan
currency that will be utilized to satisfy Lead Plaintiffs'
US$204 million allowed claim. Under the revised Plan, this
claim, upon the required final approval by the Bankruptcy Court
and the U.S. District Court for the Eastern District of
Michigan, will now be satisfied with shares of New Common Stock
of reorganized Delphi and rights to participate in a Discount
Rights Offering.
Michael S. Etkin, Esq., at Lowenstein Sandler PC, in New York,
relates that the current versions of the Disclosure Statement
and Plan address many of Lead Plaintiffs' concerns, but not all
of them.
The Debtors previously agreed to make several revisions to
insure consistency between the Disclosure Statement and Plan and
the Stipulation of Settlement resolving the Securities
Litigation.
The parties have not yet been able to reach agreement on two of
Lead Plaintiffs' proposed revisions to the Disclosure Statement
and Plan involving third party releases and certain conditions
to the effectiveness of the Plan.
To the extent the Lead Plaintiffs' outstanding concerns with the
Disclosure Statement are not resolved on or prior to the hearing
on Nov. 8, 2007, or any adjourned date, the Lead Plaintiffs
reserve the right to raise any and all remaining objections to
the Disclosure Statement at the hearing.
About Delphi Corp.
Headquartered in Troy, Michigan, Delphi Corporation (OTC: DPHIQ)
-- http://www.delphi.com/-- is the single supplier of vehicle
electronics, transportation components, integrated systems and
modules, and other electronic technology. The company's
technology and products are present in more than 75 million
vehicles on the road worldwide. Delphi has regional
headquarters in Japan, Brazil and France.
The company filed for chapter 11 protection on Oct. 8, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler Jr.,
Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at Skadden,
Arps, Slate, Meagher & Flom LLP, represent the Debtors in their
restructuring efforts. Robert J. Rosenberg, Esq., Mitchell A.
Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins LLP,
represents the Official Committee of Unsecured Creditors. As of
Mar. 31, 2007, the Debtors' balance sheet showed
US$11,446,000,000 in total assets and US$23,851,000,000 in total
debts.
The Debtors' exclusive plan-filing period expires on
Dec. 31, 2007. On Sept. 6, 2007, the Debtors filed their
Chapter 11 Plan of Reorganization and a Disclosure Statement
explaining that Plan.
(Delphi Bankruptcy News, Issue No. 94; Bankruptcy Creditors'
Service Inc., http://bankrupt.com/newsstand/or 215/945-7000)
EL PASO: Reports US$922 Mil. Net Income for Qtr. Ended Sept. 30
---------------------------------------------------------------
El Paso Corporation has reported third quarter 2007 financial
and operational results for the company.
Highlights:
-- Earnings per share from continuing operations up 33 percent
-- US$0.20 earnings per diluted share from continuing
operations versus earnings of US$0.15 in 2006
-- Pipeline earnings before interest expense and taxes (EBIT)
and throughput up 9 percent and 4 percent, respectively,
from third quarter 2006
-- E&P EBIT up 65 percent versus third quarter 2006
-- Production, including unconsolidated affiliate volumes,
totaled 848 million cubic feet equivalent per day (Mmcfe/d)
-- a 5 percent increase over third quarter 2006
-- Completed Peoples Energy Production Company acquisition on
Sept. 28, 2007
-- Exploration success in Brazil
-- Expanded hedge position for 2008
-- Filed SEC Registration Statement to create pipeline MLP-El
Paso Pipeline Partners, L.P.
"This quarter continues our financial and operational success as
our Pipelines and E&P businesses performed well," said Doug
Foshee, El Paso's president and chief executive officer.
"During the quarter, we completed the Peoples acquisition, which
added excellent staff and properties into our E&P operations.
The quarter also included significant exploration success in
Brazil. And three major pipeline projects, representing US$1.2
billion of capital, received FERC approval as we have continued
to expand our pipeline business. We also marked an important
step in forming our pipeline MLP with the registration filing
for El Paso Pipeline Partners."
Items Impacting Quarterly Results
Third quarter 2007 results from continuing operations include a
US$65-million, or US$0.09 per diluted share, after-tax
impairment of the company's interests in its Brazilian power
assets due in part to ongoing developments in Brazil's
electricity markets. Results also include a US$49-million, or
US$0.07 per diluted share, after-tax gain related to the
reversal of a liability related to The Coastal Corporation's
legacy crude oil marketing and trading business; a US$7-million,
or US$0.01 per diluted share, after-tax loss associated with the
company's indemnification of Case Corporation retiree benefits;
and a US$10-million, or US$0.01 per diluted share, after-tax
gain related to the mark-to-market impact of derivatives in our
marketing segment intended to manage price risk on natural gas
and oil production. Third quarter 2006 results include a
comparable US$43-million after-tax MTM gain. All after-tax
amounts except the Brazilian power impairments were calculated
using a 36-percent tax rate.
Financial Results for Nine Months Ended Sept. 30, 2007
For the nine months ended Sept. 30, 2007, El Paso reported net
income available to common stockholders of US$922 million, or
US$1.31 per diluted share, compared with US$613 million, or
US$0.87 per diluted share, for the first nine months of 2006. In
addition to the third quarter 2007 items mentioned above,
results for 2007 include US$674 million, or US$0.96 per diluted
share, of earnings that relate primarily to the gain on the sale
of ANR and related assets. Results for 2007 also include a
US$184-million, or US$0.26 per diluted share, after-tax charge
related to early debt retirement costs and a US$40-million, or
US$0.06 per diluted share, MTM after-tax loss on production-
related derivatives in our marketing segment. During the same
period in 2006, production-related derivatives generated a
US$164-million, or US$0.24 per diluted share, MTM after-tax
gain, and earnings from discontinued operations were US$95
million, or US$0.13 per diluted share. After-tax amounts were
calculated using a 36-percent tax rate.
Pipeline Group
The Pipeline Group's EBIT for the three months ended
Sept. 30, 2007, was US$275 million, compared with US$253 million
for the same 2006 period. The increase is primarily due to
incremental revenues from several expansion projects that went
into service during 2006; the Cypress Pipeline, which went into
service in May 2007; higher transportation revenues due to
increased sales and utilization of capacity; and higher
throughput, primarily in the Rocky Mountains and southern
regions.
Exploration and Production
The Exploration and Production segment's EBIT for the three
months ended Sept. 30, 2007, was US$232 million, compared with
US$141 million for the same period in 2006. The increase is
primarily due to increased production and higher realized
commodity prices, due primarily to hedging gains. Third quarter
2007 production volumes averaged 787 MMcfe/d, excluding
unconsolidated affiliate volumes of 61 MMcfe/d. Third quarter
2006 production volumes averaged 744 MMcfe/d, excluding 66
MMcfe/d of unconsolidated affiliate volumes. The increase
reflects successful drilling programs and acquisitions. Despite
industry inflation, total per-unit cash operating costs
decreased to an average of US$1.77 per thousand cubic feet
equivalent in third quarter 2007, compared with US$1.95 per Mcfe
for the same 2006 period. The improvement is primarily a result
of reduced production costs resulting from lower workover
activity levels, partially offset by higher general and
administrative costs.
New Hedge Positions for 2008
El Paso has expanded its hedge position for 2008, so the company
now has an average floor price of US$7.92 per MMBtu and an
average ceiling price of US$10.06 per MMBtu for 137 TBtu of
anticipated 2008 natural gas production. The current 2008
natural gas position covers approximately 61 percent of volumes
that El Paso hedged for 2007. Further information on the
company's hedging activities will be available in El Paso's Form
10-Q.
Other Operations
Marketing
The Marketing segment reported an EBIT loss of US$8 million for
the three months ended Sept. 30, 2007, compared with an EBIT
loss of US$108 million for the same period in 2006. The third
quarter 2007 and 2006 results included gains of US$15 million
and US$67 million, respectively; from MTM changes in the fair
value of derivatives intended to manage the price risk
of the company's natural gas and oil production. The third
quarter 2006 results also include a US$133-million MTM loss on
natural gas supply agreements with MCV.
Power
The Power segment reported an EBIT loss of US$67 million for the
three months ended Sept. 30, 2007, compared with EBIT of US$38
million for the same period in 2006. The decrease is primarily
due to third quarter 2007 impairments of the company's interest
in its Brazilian power assets. In addition, the third quarter
2006 results included US$25 million of gains on sales of
investments.
Corporate and Other
During the third quarter of 2007, Corporate and Other reported
EBIT of US$51 million compared with an EBIT loss of US$17
million for the same period in 2006. Third quarter 2007 results
were favorably impacted by a US$77 million gain on the reversal
of a liability related to the Coastal Corporation's legacy crude
oil marketing and trading business.
About El Paso Corp.
Headquartered in Houston, Texas, El Paso Corporation (NYSE: EP)
-- http://www.elpaso.com/-- is an energy company that provides
natural gas and related energy products. The company owns North
America's interstate pipeline system, which has approximately
55,500 miles of pipe. It also owns approximately 470 billion
cubic feet of storage capacity and a liquefied natural gas
import facility with 806 million cubic feet of daily base load
send out capacity. El Paso's exploration and production
business is focused on the exploration for and the acquisition,
development and production of natural gas, oil and natural gas
liquids in the United States, Brazil and Egypt. It operates in
three business segments: Pipelines, Exploration and Production
and Marketing. It also has a Power segment, which holds its
remaining interests in international power plants in Brazil,
Asia and Central America.
* * *
Moody's Investor Services placed El Paso Corporation's
probability default and long term corporate family ratings at
"Ba3" in March 2007, which still holds to date. Moody's said
the outlook is positive.
As reported in the Troubled Company Reporter-Latin America on
June 15, 2007, Fitch Ratings affirmed the ratings of El Paso
Corporation and its core pipeline subsidiaries, and assigned a
senior unsecured rating of 'BB+' to the company's proposed
offering of US$1.275 billion of senior unsecured notes due in
2014 and 2017. Fitch said the rating outlook is stable.
FERRO CORP: Polymer Products Hikes Plastic Compound Prices
----------------------------------------------------------
Ferro Corporation's Engineered Polymer Products business is
increasing the price in North America for all filled and
reinforced plastic compounds. Price increases range from
US$0.035 to US$0.06 per pound depending on the resin content of
the product supplied. The increases are effective with shipments
made as of Nov. 15, 2007.
Engineered Polymer Products also announced price increases in
North America for color concentrates. White & Additive
concentrates will increase US$0.05 per pound and Specialty Color
& Black concentrates will increase US$0.08 per pound, effective
with shipments made as of Nov. 1, 2007.
Jim Kolenc, Business Director, Engineered Polymer Products,
noted that price increases are necessary due to rising raw
material and energy costs. "We have worked diligently in our
Filled & Reinforced Plastics and Color Concentrates groups, as
well as our Advanced Polymer Alloy group, to control our
internal operating and conversion costs in order to ensure
favorable pricing for Ferro customers," said Mr. Kolenc. "This
pricing action supports our ability to continue providing high-
value products and services to our customers while remaining
competitive."
About Ferro Corp.
Headquartered in Cleveland, Ohio, Ferro Corporation (NYSE: FOE)
-- http://www.ferro.com/-- is a global producer of an array of
specialty chemicals including coatings, enamels, pigments,
plastic compounds, and specialty chemicals for use in industries
ranging from construction, pharmaceuticals and
telecommunications. Ferro operates through the following five
primary business segments: Performance Coatings, Electronic
Materials, Color and Performance Glass Materials, Polymer
Additives, and Specialty Plastics. Revenues were US$2 billion
for the FYE ended Dec. 31, 2006.
Ferro Corp. has global locations in Argentina, Australia,
Belgium, Brazil, China, among others.
* * *
As reported in the Troubled Company Reporter-Latin America on
May 16, 2007, Moody's Investors Service assigned a B1 corporate
family rating to Ferro Corporation. Moody's also assigned a B1
rating to the company's US$200 million senior secured notes
(issued as unsecured notes in 2001) due in January 2009 and an
SGL-3 speculative grade liquidity rating.
FORD MOTOR: UAW Members to Vote on New Labor Pact on Sunday
-----------------------------------------------------------
United Auto Workers union members at Ford Motor Company plants,
including those in Missouri and Louisville, Kentucky, will be
voting on a new labor agreement between the carmaker and the
union on Nov. 11, 2007, according to various reports.
As reported in yesterday's Troubled Company Reporter, Ford and
the union reached a tentative agreement on a four-year national
labor contract covering approximately 54,000 represented
employees in the United States. The UAW Ford National Council
-- made up of delegates from more than 55 Ford facilities across
the nation -- voted to unanimously recommend ratification of the
union's 2007 tentative agreement with Ford.
The St. Louis Business Journal relates that voting will conclude
on Nov. 12, 2007.
Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) --
http://www.ford.com/-- manufactures or distributes automobiles
in 200 markets across six continents. With about 260,000
employees and about 100 plants worldwide, the company's core and
affiliated automotive brands include Ford, Jaguar, Land Rover,
Lincoln, Mercury, Volvo, Aston Martin, and Mazda. The company
provides financial services through Ford Motor Credit Company.
The company has operations in Japan in the Asia Pacific region.
In Europe, the company maintains a presence in Sweden, and the
United Kingdom. The company also distributes its brands in
various Latin American regions, including Argentina and Brazil.
* * *
As reported in the Troubled Company Reporter-Latin America on
Nov. 7, 2007, Standard & Poor's Ratings Services said its 'B'
long-term corporate credit rating on Ford Motor Co. and Ford
Motor Credit Co. remains on CreditWatch with positive
implications, following the agreement between Ford and the
United Auto Workers of a new labor contract.
GENERAL MOTORS: Expects US$39 Bil. Non-Cash Charge in 3rd Qtr.
--------------------------------------------------------------
General Motors Corp. disclosed Tuesday that it will record a net
non-cash charge of US$39 billion for the third quarter of 2007
related to establishing a valuation allowance against its
deferred tax assets in the U.S., Canada and Germany.
In accordance with the Financial Accounting Standards Board's
Statement of Financial Accounting Standards No. 109, Accounting
for Income Taxes, GM has evaluated its deferred tax assets
quarterly to determine if valuation allowances were required.
As previously disclosed in GM's 2006 Form 10-K, GM had
determined in prior periods that a valuation allowance was not
necessary for its DTAs in the U.S., Canada or Germany based on
several factors, including the degree to which the company's
three-year historical cumulative losses were attributable to
special items or charges, several of which were incurred as a
result of actions to improve future profitability; the long
duration of its deferred tax assets; and the expectation of
continued strong earnings at GMAC Financial Services and
improved earnings in GM North America.
SFAS No. 109 guidelines require that a valuation allowance
should now be established due to more recent events and
developments during the 2007 third quarter. A significant
negative factor was the company's three-year historical
cumulative loss in the third quarter of 2007 in the U.S., Canada
and Germany on an adjusted basis. Another significant factor
was the ongoing weakness at GMAC Financial Services related to
its Residential Capital LLC mortgage business, including
substantial U.S. losses incurred in 2007. Finally, the company
faces more challenging near-term automotive market conditions in
the U.S. and Germany.
"The establishment of a valuation allowance does not have any
impact on cash, nor does such an allowance preclude us from
using our loss carryforwards or other deferred tax assets in the
future," said Fritz Henderson, GM vice chairman and chief
financial officer.
"It's also important to note that the establishment of a
valuation allowance does not reflect a change in the company's
view of its long-term automotive financial outlook," Henderson
added. "GM continues to believe that its new product
introductions, combined with the new GM-UAW labor agreement,
once fully implemented, will significantly improve GM's
competitive position in the U.S. and better position the company
to utilize tax benefits in the U.S. and Canada in the future."
SFAS No. 109 requires that companies assess whether valuation
allowances should be established against their deferred tax
assets based on the consideration of all available evidence
using a "more likely than not" standard. In making such
judgments, significant weight is given to evidence that can be
objectively verified. A company's current or previous losses
are given more weight than its future outlook, and a recent
three-year historical cumulative loss is considered a
significant factor that is difficult to overcome.
About General Motors
Headquartered in Detroit, Michigan, General Motors Corp. (NYSE:
GM) -- http://www.gm.com/-- was founded in 1908. GM employs
about 280,000 people around the world and manufactures cars and
trucks in 33 countries, including the United Kingdom, Germany,
France, Russia, Brazil and India. In 2006, nearly 9.1 million
GM cars and trucks were sold globally under the following
brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden,
HUMMER, Opel, Pontiac, Saab, Saturn and Vauxhall. GM's OnStar
subsidiary is the industry leader in vehicle safety, security
and information services.
* * *
As reported in the Troubled Company Reporter on Oct. 23, 2007,
Standard & Poor's Ratings Services affirmed its 'B' corporate
credit rating and other ratings on General Motors Corp. and
removed them from CreditWatch with positive implications, where
they were placed Sept. 26, 2007, following agreement on the new
labor contract. S&P said the outlook is stable.
GERDAU AMERISTEEL: Net Income Up 35% to US$123.8MM in Third Qtr.
----------------------------------------------------------------
Gerdau Ameristeel Corporation has reported net income of
US$123.8 million, or US$0.40 per share fully diluted, for the
three months ended Sept. 30, 2007, a 35% increase in comparison
to net income of US$91.4 million, or US$0.30 per share fully
diluted, for the three months ended Sept. 30, 2006.
For the nine months ended Sept. 30, 2007, net income is US$396.5
million, or US$1.29 per share fully diluted, an increase of 29%
compared to net income of US$307.9 million, or US$1.01 per share
fully diluted, for the nine months ended Sept. 30, 2006.
Revenues for the three months ended Sept. 30, 2007 increased 20%
to US$1.4 billion from US$1.2 billion for the three months ended
Sept. 30, 2006. For the three months ended Sept. 30, 2007,
finished steel shipments increased to 1.8 million tons, an
increase of 123 thousand tons from the three months ended
Sept. 30, 2006, primarily as a result of the acquisitions of
Chaparral Steel and Pacific Coast Steel. Average mill finished
steel selling prices increased 11% over the level in this same
period in 2006.
For the nine months ended Sept. 30, 2007, revenues were US$4.1
billion compared to US$3.4 billion for the nine months ended
Sept. 30, 2006. For the nine months ended Sept. 30, 2007,
finished steel shipments increased to 5.4 million tons, an
increase of 309 thousand tons from the nine months ended
Sept. 30, 2006, primarily as a result of the acquisitions of
Chaparral Steel, Sheffield Steel, and Pacific Coast Steel.
Average mill finished steel selling prices increased 11% over
those in this same period in 2006.
For the three months ended Sept. 30, 2007, metal spread, the
difference between mill selling prices and scrap raw material
costs, was US$440 per ton, and an increase of US$50 per ton from
the same period in 2006. For the nine months ended
Sept. 30, 2007, metal spread was US$409 per ton, an increase of
US$35 per ton from the same period in 2006.
EBITDA was US$253.8 million for the three months ended
Sept. 30, 2007 and US$742.9 million for the nine months ended
Sept. 30, 2007, compared to EBITDA of US$211.4 million for the
three months ended Sept. 30, 2006 and US$607.0 million for the
nine months ended Sept. 30, 2006.
Included in selling and administrative expense for the three and
nine months ended Sept. 30, 2007 is a non-cash pretax expense
reversal of US$2.0 million and a non-cash pretax expense of
US$16.0 million, respectively, to mark to market outstanding
stock appreciation rights and expenses associated with other
executive compensation agreements compared to a non-cash pretax
expense reversal of US$0.6 million and a non-cash pretax expense
of US$30.6 million, respectively, for the three and nine months
ended Sept. 30, 2006.
On Sept. 14, 2007, the company completed its US$4.2 billion
acquisition of Chaparral Steel company, broadening Gerdau
Ameristeel's product portfolio and giving it a wide range of
structural steel products. Chaparral is a leading producer of
structural steel products in North America and also a major
producer of steel bar products. It operates two mini-mills, one
located in Midlothian, Texas, and the other located in
Petersburg, Virginia. The acquisition was financed with credit
facilities totaling US$3.9 billion. As a result of Chaparral's
operations only being included subsequent to the acquisition
date and fair value purchase accounting adjustments required
under US GAAP, the Chaparral assets did not significantly
contribute to the operating income of the company for the three
months ended Sept. 30, 2007.
On Nov. 1, 2007, the company filed a final short form prospectus
with the securities regulatory authorities in each of the
provinces and territories of Canada and with the United States
Securities and Exchange Commission, in connection with an
offering in the United States and Canada of 110 million of its
common shares. Gerdau S.A., which currently owns approximately
66.5% of the outstanding common shares of the company, has
agreed to purchase approximately 73 million common shares from
the company in the offering. Approximately 37 million common
shares will be distributed to the public through an underwriting
syndicate. The offering is expected to close on
Nov. 7, 2007. The net proceeds of the offering of approximately
US$1.3 billion will be used to partially repay the loans
incurred by the company in connection with the acquisition of
Chaparral. The company has also granted the underwriters an
option to purchase up to an additional 5,535,750 common shares
at the public offering price (as adjusted, if applicable, for
any dividends declared and payable on the common shares prior to
exercise of the option), less underwriting commission within 30
days following the closing of the offering. Gerdau S.A. has
agreed to purchase, within two days after the exercise of the
overallotment option, a number of additional common shares to
maintain its approximate 66.5% ownership interest, at the public
offering price (as adjusted, if applicable, for any dividends
declared and payable on the company common shares prior to
exercise of the option).
On Nov. 5, 2007, the Board of Directors approved a quarterly
cash dividend of US$0.02 (two USUS$ cents) per common share,
payable Dec. 12, 2007 to shareholders of record at the close of
business on Nov. 27, 2007.
Mario Longhi, President and Chief Executive Offcier of Gerdau
Ameristeel, commented: "Our operations have performed well
during 2007 and earnings through the first nine months of 2007
have already surpassed our full year earnings from 2006. The
slowdown in the North American residential construction segment
has little direct impact to our demand as we primarily service
the infrastructure and non-residential construction industry,
which remains strong."
Mr. Longhi aslso said "We are focused on executing on our
integration strategy for Chaparral which to date has proceeded
well. Employees from both organizations have been fully engaged
in this process, sharing best practices to seek to ensure that
synergy opportunities are realized."
"With the expected completion of our equity offering generating
approximately US$1.3 billion of cash, prior to any exercise of
the overallotment option, to reduce our debt levels, we believe
that our capital structure will be well positioned for the
coming years." Mr. Longhi
About Gerdau Ameristeel
Headquartered in Tampa, Florida, Gerdau Ameristeel Corporation
(NYSE: GNA; TSX: GNA.TO) -- http://www.ameristeel.com/-- is a
mini-mill steel producer in North America. Through its
vertically integrated network of 17 mini-mills, 17 scrap
recycling facilities and 52 downstream operations, Gerdau
Ameristeel serves customers throughout North America. The
company's products are sold to steel service centers, steel
fabricators, or directly to original equipment manufactures for
use in a variety of industries, including construction, cellular
and electrical transmission, automotive, mining and equipment
manufacturing. Gerdau Ameristeel is a unit of Brazilin firm
Gerdau SA.
* * *
As reported in the Troubled Company Reporter on Oct. 1, 2007,
Moody's Investors Service confirmed these ratings on Gerdau
Ameristeel Corporation: (i) 'Ba1' probability of default rating;
(ii) 'Ba1' corporate family rating; and (iii) 'Ba1', LGD4 59%
US$405 million senior unsecured regular bond. Moody's said the
outlook for all ratings is stable.
IWT TESORO: Can Get US$3.3-Mil. DIP Loan from Bank of America
-------------------------------------------------------------
I.W.T. Tesoro Corporation and its debtor-affiliates obtained
permission from the U.S. Bankruptcy Court for the Southern
District of New York to borrow and secure debtor-in-possession
financing from Bank of America N.A., fka Fleet Capital
Corporation.
The Debtors also obtained authority to comply with the
ratification and amendment agreement they entered into with Bank
of America. The Debtors disclosed that pursuant to the
ratification agreement, Bank of America agreed to provide the
Debtors funds on an "overadvance" basis up to an approximate
aggregate sum of US$3.3 million. The sum will provide the
Debtors with enough cash to fund operations and pay their
anticipated Chapter 11 professional fees.
The Court directed Laurus Master Fund to provide the Debtors
with an additional US$1 million supplemental loan.
As adequate protection, the Debtors grant Bank of America a
superpriority administrative claim, having priority in right of
payment over any and all other obligations, liabilities and
indebtedness of Debtors, and over any and all administrative
expenses or priority claims, to secure the prompt payment and
performance of any and all obligations.
In addition, for Laurus' pre-petition security interests in the
pre-petition collateral, the Debtors grant Laurus a lien on and
security interest on the collateral to secure any diminution in
value of Laurus' interest in the collateral, which lien and
security interest will be subject, subordinate and junior to the
post-petition liens and security interests and super priority
claims granted in favor of BofA and to the carve-out expenses.
About I.W.T. Tesoro
I.W.T. Tesoro Corporation, fka Ponca Acquisition Company, --
http://www.iwttesoro.com/-- is headquartered in New York City.
The company and its subsidiaries distribute building materials,
specifically hard floor and wall coverings. They are
wholesalers and do not sell directly to any end user. Their
products consist of ceramic, porcelain and natural stone floor,
wall and decorative tile. They import a majority of these
products from suppliers and manufacturers in Europe, South
America (Brazil), and the Near and Far East. Their markets
include the United States and Canada. They also offer private
label programs for branded retail sales customers, buying
groups, large homebuilders and home center store chains.
The Debtor and its debtor-affiliates, International Wholesale
Tile, Inc. and American Gres, Inc., filed for Chapter 11
bankruptcy protection on Sept. 6, 2007 (Bankr. S.D. NY Lead Case
No. 07-12841). Dawn K. Arnold, Esq. and Jonathan S. Pasternak,
Esq. at Rattet, Pasternak & Gordon-Oliver, L.L.P. represent the
Debtors in their restructuring efforts. Donlin, Recano & Co.,
Inc. serves as the Debtors' claims and noticing agent. An
Official Committee of Unsecured Creditors has been appointed by
the U.S. Trustee for Region 2 on this case. As of
June 30, 2007, the Debtors had total assets of US$39,798,579 and
total debts of US$47,940,983.
IWT TESORO: Court Okays Mahoney Cohen as Panel's Fin'l Advisor
--------------------------------------------------------------
The U.S. Bankrupty Court for the Southern District of New York
gave the Official Committee of Unsecured Creditors appointed in
IWT Tesoro Corp. and debtor-affiliates' bankruptcy cases
permission to retain Mahoney Cohen & Company as its financial
advisors, nunc pro tunc to Sept. 19, 2007.
Mahoney Cohen is expected to:
a. assist the Committee in its evaluation of the Debtors'
post-petition cash flow and other projections and budgets
prepared by the Debtor or its financial advisors;
b. analyze transactions with the Debtors' financing
institutions and provide financial analysis related to any
debtor-in-possession financing, including advising the
Committee concerning such matters;
c. Monitor the Debtors' activities regarding cash expenditures
and general business operations subsequent to the filing of
the petition under Chapter 11;
d. assist the Committee in its review of monthly operating
reports submitted by the Debtors or their financial
advisors;
e. manage or assist with any investigation into pre-petition
acts, conduct, property, liabilities and financial
condition of the Debtors, the Debtors' management, or
creditors, including the operation of the Debtors'
business, as instructed by the Committee;
f. analyze transactions with vendors, insiders, related and
affiliated companies, subsequent and prior to the date of
the filing of the petition under Chapter 11, as instructed
by the Committee;
g. assist the Committee or its counsel in any litigation
proceedings against the financing institutions of the
Debtors, insiders and other potential adversaries;
including testimony, if necessary;
h. assist the Committee in its review of the financial aspects
of any proposed asset purchase agreement or evaluating any
plan of reorganization/liquidation. If applicable, assist
the Committee in negotiating, evaluating and qualifying
any competing offers;
i. attend meetings with representatives of the Committee and
their counsel; and
j. prepare presentations to the Committee that provide
analyses and updates on diligence performed.
Charles M. Berk, a shareholder of Mahoney Cohen, told the Court
that the firm is a "disinterested person" as that term is
defined in Section 101(14) of the Bankruptcy Code, and does not
hold or represent any interest adverse to the Debtors' estates.
The firm's professionals currently bill:
Designation Hourly Rate
----------- -----------
Shareholders and Directors US$425 - US$595
Managers and Senior Managers US$325 - US$425
Senior Accountants and Staff US$100 - US$325
Mr. Berk can be reached at:
Charles M. Berk, C.P.A.
Mahoney Cohen & Company
1065 Avenue of the Americas
New York, N.Y. 10018
Tel: (212) 790-5700
Fax: (212) 398-0267
http://www.mahoneycohen.com/
About I.W.T. Tesoro
I.W.T. Tesoro Corporation, fka Ponca Acquisition Company, --
http://www.iwttesoro.com/-- is headquartered in New York City.
The company and its subsidiaries distribute building materials,
specifically hard floor and wall coverings. They are
wholesalers and do not sell directly to any end user. Their
products consist of ceramic, porcelain and natural stone floor,
wall and decorative tile. They import a majority of these
products from suppliers and manufacturers in Europe, South
America (Brazil), and the Near and Far East. Their markets
include the United States and Canada. They also offer private
label programs for branded retail sales customers, buying
groups, large homebuilders and home center store chains.
The Debtor and its debtor-affiliates, International Wholesale
Tile, Inc. and American Gres, Inc., filed for Chapter 11
bankruptcy protection on Sept. 6, 2007 (Bankr. S.D. NY Lead Case
No. 07-12841). Dawn K. Arnold, Esq. and Jonathan S. Pasternak,
Esq. at Rattet, Pasternak & Gordon-Oliver, L.L.P. represent the
Debtors in their restructuring efforts. Donlin, Recano & Co.,
Inc. serves as the Debtors' claims and noticing agent. An
Official Committee of Unsecured Creditors has been appointed by
the U.S. Trustee for Region 2 on this case. As of June 30,
2007, the Debtors had total assets of US$39,798,579 and total
debts of US$47,940,983.
KENDLE INT'L: Moody's Affirms Corporate Family Rating at B1
-----------------------------------------------------------
Moody's Investors Service has affirmed the B1 Corporate Family
Rating of Kendle International Inc. and withdrawn the B1 rating
on the senior secured term loan. Moody's also changed the
rating on the senior secured revolving credit facility to Ba1 in
accordance with Moody's Loss Given Default Methodology. The
rating actions follow the company's full repayment of its term
loan primarily with the proceeds from the sale of US$200 million
convertible senior unsecured notes. The outlook for the ratings
is stable.
The B1 Corporate Family Rating is supported by the company's
solid cash flow coverage of debt metrics, and overall favorable
trends in financial strength and revenue diversity since the
August 2006 acquisition of CRL Clinical Services, which was the
Phase II-IV business of Charles River Laboratories International
Inc. The B1 is also supported by Moody's expectation for future
revenue growth, supported by healthy underlying industry demand
for contract research services. This is balanced, however, by
Kendle's limited scale versus a number of much larger market
participants and a highly competitive environment in which
contract research organizations compete for business awards,
employees and business development opportunities. The ratings
are also constrained by Moody's expectation for continued
acquisition activity.
Approximately US$54 million in rated debt affected.
Ratings affirmed:
-- Corporate Family Rating, B1
-- Speculative Grade Liquidity Rating, SGL-2
Ratings upgraded:
-- Probability of Default Rating, to B1 from B2
-- Senior Secured Revolving Credit Facility due 2011, to Ba1
(LGD1, 4%) from B1 (LGD3, 31%)
Based in Cincinnati, Kendle International Inc. (Nasdaq: KNDL) --
http://www.kendle.com/-- is a global clinical research
organization and provides Phase II-IV clinical development
services worldwide. The company's global clinical development
business is focused on five regions - North America, Europe,
Asia/Pacific, Africa and Latin America including Brazil.
MILACRON INC: Posts US$4.5-Mln Net Loss in Third Quarter of 2007
----------------------------------------------------------------
Milacron Inc. incurred a net loss for the quarter ended Sept. 30
of US$4.5 million on sales of US$204 million, compared to a net
loss in the third quarter of 2006 of US$7.2 million on sales of
US$209 million. Restructuring costs and other non-recurring
costs totaled US$1.7 million in the quarter, compared to US$2.9
million in the year-ago quarter.
Manufacturing margins in the third quarter improved to 19.7%
from 18.7% a year ago, primarily as a result of continued cost-
reduction and sourcing initiatives.
New orders of US$203 million were up slightly from US$201
million in the third quarter of 2006 due to currency translation
effects.
Cash on hand at the end of the quarter exceeded US$37 million,
and Milacron had approximately US$42 million available for
borrowing under its asset-based revolving credit facility. The
company's liquidity (cash plus borrowing availability) rose to
US$79 million from US$65 million at the beginning of the quarter
and US$72 million at the end of the third quarter last year.
"Our efforts to expand our presence in faster-growing, emerging
markets continue to pay dividends," said Ronald D. Brown,
chairman, president and chief executive officer. "Our orders
from these markets are up 20% year to date. Our greatest
current challenge, however, is the injection molding machine
market in North America, which is down 17% year to date from
2006. This also negatively impacts our mold technologies
business. As a result, we are stepping up our restructuring
efforts to reduce our cost structure in this market."
Segment Results
Machinery Technologies-North America (machinery and related
parts and services for injection molding, blow molding and
extrusion supplied from North America, India and China) Sales in
the quarter fell to US$93 million from US$106 million in the
same period last year, as the ongoing consolidation of U.S.
automotive molders curtailed demand from that sector and
contributed to the glut of used equipment, depressing the market
for new injection molding machines in North America. Sales of
injection machines in India remained at record-high levels, and
extrusion equipment sales continued to show solid increases.
Blow molding machinery sales were down in the quarter but were
running slightly ahead of last year on a year-to-date basis.
Cost-containment measures helped minimize the impact of the
overall volume drop, as segment earnings declined to US$3.8
million from US$6.0 million in the year-ago quarter. New orders
in the quarter were US$91 million, off from US$106 million last
year.
Machinery Technologies-Europe (machinery and related parts and
services for injection molding and blow molding supplied from
Europe) Demand for injection molding machines continued to show
growth in Western Europe, and, as a result, segment sales rose
to US$46 million from US$40 million in 2006. Blow molding
machine shipments were up slightly. Favorable currency
translation effects accounted for about half of the segment
sales gain. New orders were also US$46 million compared to US$31
million in the year-ago quarter, as currency accounted for about
one-fifth of the increase. Higher volume and restructuring
benefits aided the segment in posting a small operating profit
of US$0.9 million compared to an operating loss of US$0.7
million in the year-ago quarter.
Mold Technologies (mold bases and related parts and services, as
well as maintenance, repair and operating supplies for injection
molding worldwide) Softness in the injection molding-related
markets in North America, particularly in the automotive sector,
led to a slight sales decline in the third quarter to US$37
million from US$38 million a year ago. In Europe, our mold
technologies sales were essentially flat in local currencies.
During the quarter this segment accelerated its restructuring
activities as it incurred a small loss of US$0.4 million
compared to breaking even in the year-ago quarter.
Industrial Fluids (water-based and oil-based coolants,
lubricants and cleaners for metalcutting and metalforming
operations worldwide) Sales of US$31 million were up from US$29
million in the third quarter of 2006, with currency translation
effects accounting for most of the increase. With better
pricing and improved operating efficiency, segment earnings
jumped to US$3.5 million from US$1.9 million a year ago.
Headquartered in Cincinnati, Ohio, Milacron Inc. (NYSE: MZ)
-- http://www.milacron.com/ -- is a global manufacturer
and supplier of plastics-processing equipment and related
supplies. Milacron is also one of the largest global
manufacturers of synthetic water-based industrial fluids used in
metalworking applications. The company has major manufacturing
facilities in Brazil, North America, Europe, and Asia.
Milacron's annual revenues approximated USUS$805 million over
the last twelve months.
The company has an office in South Korea, and joint ventures in
China and India. In Europe, the company maintains operations in
Belgium, Germany, Italy, the Netherlands, Spain, and England.
* * *
As reported in the Troubled Company Reporter on Jan. 2, 2007,
Standard & Poor's Ratings Services revised its outlook on
Cincinnati, Ohio-based Milacron Inc., to developing from
negative. At the same time, Standard & Poor's affirmed its
ratings on the company, including its 'CCC+' corporate credit
rating.
STRATUS TECH: Appoints Ira Feuer as Vice Pres. of Business Dev't
----------------------------------------------------------------
Stratus Technologies Group has named Ira Feuer to serve as the
company's Vice President of Business Development, reporting to
Jorge L. Reyes, President and Chief Executive Officer. "When we
were building Stratus' Executive Team, we simply wanted the best
resources and Ira represents that in the public sector
information technology field, especially in the area of
municipal wireless," Mr. Reyes said.
In his new role, Mr. Feuer will be responsible for the
development and implementation of strategic business efforts
focusing on municipal wireless markets. "Stratus is totally
dedicated to providing superior wireless services. Our
commitment is to deliver unparalleled applications across the
wireless infrastructure accompanied with exemplary customer
service. We are proud of our partnerships with top leaders in
the wireless market such as Firetide, IBM and BIG Wireless and
confident in our ability to develop best-of-class solutions,"
said Mr. Feuer.
As a Senior Information Technology Executive with extensive
expertise in local government IT initiatives, Mr. Feuer brings
25 years of diversified experience, serving as Miami-Dade
County's Chief Information Security Officer, Assistant Director
of the Enterprise Technology Services Department as well as the
Miami-Dade Police Department's Commander of the Systems
Development Bureau. During his tenure with Miami-Dade County
government, he has developed and implemented innovative
technologies in the public safety, transportation, solid waste,
and customer service areas. "When it comes to making things
happen, Ira Feuer is an experienced executive with tremendous
knowledge and experience in working government. I believe Ira's
capabilities and insights will serve Stratus very well as they
move forward in their business. Firetide is excited about
Stratus' plans," said Firetide's Vice President Michael Dillon.
Mr. Feuer most recently served as the chief IT advisor to the
Mayor of Miami-Dade County for Wireless Miami-Dade and was
responsible for the oversight of all IT strategies and
priorities for this exciting and substantial wireless
initiative. Additionally, he served as a key advisor to a task
force of business and community leaders to develop the vision,
feasibility analysis, business plans, security and privacy
policy, technology and financial models for the project. Mr.
Feuer holds a MBA from the University of Miami and dual
undergraduate degrees in Computer Science and Chemistry/Physics
from Florida International University and the University of
Florida.
About Stratus Technologies
Stratus Technologies is a global solutions provider focused
exclusively on helping its customers achieve and sustain the
availability of information systems that support their critical
business processes. Based upon its 25 years of expertise in
server and services technology for continuous availability,
Stratus is a trusted solutions provider to customers in
telecommunications, financial services, banking, manufacturing,
life sciences, public safety, transportation & logistics, and
other industries.
* * *
As reported in the Troubled Company Reporter on Mar. 1, 2006,
Moody's Investors Service affirmed Stratus Technologies
corporate family rating of B2 and assigned B1 rating to its
proposed first lien term loan and Caa1 rating to its proposed
second lien term loan. Net proceeds from the US$175 million
first lien term loan and US$125 million second lien term loan
will be used to refinance existing US$145 million senior notes
and repurchase US$130 million preferred stock held largely by
the company's sponsors. Moody's said the rating outlook is
stable.
This rating was affirmed:
* B2 corporate family rating
These ratings were assigned:
* US$30 million revolving credit facility due 2011 -- B1
* US$175 million first lien term loan due 2011 -- B1
* US$125 million second lien term loan due 2012 -- Caa1
This rating will be withdrawn:
* US$170 million senior unsecured note due 2008 - B3
===========================
C A Y M A N I S L A N D S
===========================
BEAR STEARNS FUNDS: Investors to Vote on Bear Stearns Directors
---------------------------------------------------------------
Investors in Bear Stearns High-Grade Structured Credit
Strategies Enhanced Fund, L.P., and Bear Stearns High-Grade
Structured Credit Strategies Enhanced Leverage (Overseas), Ltd.,
have launched a campaign to replace Bear Stearns Cos. and
affiliates as the Funds' managing parties, according to a press
release by Reed Smith LLP. Reed Smith represents shareholders
with more than 25% equity stake in the two Funds.
The campaign, according to Reed Smith's news statement, aims to
replace Bear Stearns with FTI Capital Advisers, LLC, to conduct
an independent investigation into how the two funds, which once
had equity value in excess of US$650,000,000, were decimated and
appear to have been rendered worthless. Bart Schwartz, Esq.,
former Chief of the Criminal Division of the United States
Attorney's Office for the Southern District of New York, has
also been nominated to serve alongside FTI in managing the
overseas fund.
Investors in the Enhanced Leverage Fund will try to oust the
Bear Stearns-appointed directors at a November 7 meeting in
Manhattan, New York, while the Overseas Fund investors will vote
on Nov. 14, in London.
"From the feedback we are getting, we believe we are close to
having the necessary support to make it happen, but it is
critical that every investor's vote be counted," Lance
Gotthoffer, Esq., at Reed Smith, noted in the statement.
However, efforts have been hampered by Bear Stearns' refusal to
provide the investors with a complete list of investors, The
Financial Times quoted a person close to the initiative. The
group has also complained that Bear Stearns is not cooperating
with their effort to obtain access to records to buttress
potential legal claims against Bear Stearns, FINAlternatives
Hedge Fund & Private Equity News added.
In a letter addressed to the Investors dated Nov. 2, the Bear
Stearns-appointed Directors said that the board "no longer has
authority" over the fund, and replacing the Bear Stearns
representatives "would not affect the authority of the
liquidators to conduct the winding-up of the fund,"
FINAlternatives reported.
The Financial Times said that if the votes are successful, it
would be the first time the Investors had managed to replace a
bank as the administrator of funds it managed.
Dow Jones Newswires added that getting approval could be
difficult because a wide array of investors are pursuing
different paths to try to reclaim some of their lost funds, and
because Bear Stearns, under fund guidelines, is charged with
coordinating the vote. Under the Funds' governance documents,
the vote will be canceled if holders of more than 50% of each
Fund's initial capital are not present within half an hour of
the meeting's start time, Dow Jones further noted.
Mr. Gotthoffer contended that, "[i]t is too early to speculate
on what FTICA and Mr. Schwartz might find, but we are confident
that they will work diligently to maximize recoveries for
creditors and investors of the funds."
About Bear Stearns Funds
Grand Cayman, Cayman Islands-based Bear Stearns High-Grade
Structured Credit Strategies Enhanced Leverage Master Fund Ltd.
and Bear Stearns High-Grade Structured Credit Strategies Master
Fund Ltd. are open-ended investment companies, which sought high
income and capital appreciation relative to the London Interbank
Offered Rate, and designed for long-term investors.
On July 30, 2007, the Funds filed winding up petitions under the
Companies Law (2007 Revision) of the Cayman Islands. Simon
Lovell Clayton Whicker and Kristen Beighton at KPMG were
appointed joint provisional liquidators. The joint liquidators
filed for Chapter 15 petitions before the U.S. Bankruptcy Court
for the Southern District of New York the next day. On
Aug. 30, 2007, the Honorable Burton R. Lifland denied the Funds
protection under Chapter 15 of the Bankruptcy Code.
Fred S. Hodara, Esq., Lisa G. Beckerman, Esq., and David F.
Staber, Esq., at Akin Gump Strauss Hauer & Feld LLP, represent
the liquidators in the United States. The Funds' assets and
debts are estimated to be more than US$100,000,000 each. (Bear
Stearns Funds Bankruptcy News; Bankruptcy Creditors' Service
Inc.; http://bankrupt.com/newsstand/or 215/945-7000).
BEAR STEARNS: Judge Lifland Postpones Ruling on BofA's Request
--------------------------------------------------------------
The Hon. Judge Burton R. Lifland of the U.S. Bankruptcy Court
for the Southern District of New York has denied Bank of America
Corp.'s request to deprive Bear Stearns High-Grade Structured
Credit Strategies Master Fund, Ltd., and Bear Stearns High-Grade
Structure Credit Strategies Enhanced Fund, Ltd., of payments
from the bank's affiliate, Bank of America Securities, LLC,
Bloomberg News reports.
Judge Lifland said at the Nov. 1, 2007 hearing that he would
postpone a decision on BANA's request to change an indenture on
a collateralized debt obligation. He added that the change
would prevent the Bear Stearns Funds from getting any payment
from the CDO before all its notes, bonds and other debt is
repaid in full, according to Bloomberg.
BANA had asked Judge Lifland to rule that the permanent
injunction that protects bankrupt companies wouldn't bar it from
using its voting power over the CDO to change the indenture.
"I'm too much in the dark to grant the relief without further
information," Bloomberg quotes Judge Lifland as saying, citing
the extent to which the change could affect cash flow to
creditors and investors, as well as the extent to which the CDO
is "locked up with subprime mortgages." Details about the
indenture were not available in Court documents, Bloomberg says.
Judge Lifland also stated during the hearing that he didn't want
to rule on an issue of "governance" for the CDO, particularly
because the issue of whether Bear Stearns can win U.S.
protection is currently on appeal in the U.S. District Court for
the Southern District of New York, Bloomberg relates.
Bank of America lawyer Jantra Van Roy, Esq., at Zeichner Ellman
& Krause, LLP, in New York, told Judge Lifland during the
hearing that she couldn't guarantee that the changes the Bank
had asked for wouldn't affect lawsuits against Bear Stearns
related to the collapse of its hedge funds, Bloomberg adds.
Judge Lifland has directed the Bank to "come back and explain
more completely" what it is asking for, according to Bloomberg.
About Bear Stearns Funds
Grand Cayman, Cayman Islands-based Bear Stearns High-Grade
Structured Credit Strategies Enhanced Leverage Master Fund Ltd.
and Bear Stearns High-Grade Structured Credit Strategies Master
Fund Ltd. are open-ended investment companies, which sought high
income and capital appreciation relative to the London Interbank
Offered Rate, and designed for long-term investors.
On July 30, 2007, the Funds filed winding up petitions under the
Companies Law (2007 Revision) of the Cayman Islands. Simon
Lovell Clayton Whicker and Kristen Beighton at KPMG were
appointed joint provisional liquidators. The joint liquidators
filed for Chapter 15 petitions before the U.S. Bankruptcy Court
for the Southern District of New York the next day. On
Aug. 30, 2007, the Honorable Burton R. Lifland denied the Funds
protection under Chapter 15 of the Bankruptcy Code.
Fred S. Hodara, Esq., Lisa G. Beckerman, Esq., and David F.
Staber, Esq., at Akin Gump Strauss Hauer & Feld LLP, represent
the liquidators in the United States. The Funds' assets and
debts are estimated to be more than US$100,000,000 each. (Bear
Stearns Funds Bankruptcy News; Bankruptcy Creditors' Service
Inc.; http://bankrupt.com/newsstand/or 215/945-7000).
BEAR STEARNS: Massachusetts Regulators Probe on Funds' Trading
--------------------------------------------------------------
Securities regulators in the office of William F. Galvin, as
state secretary of the commonwealth of Massachusetts, are
investigating whether Bear Stearns Cos. traded mortgage-backed
securities for its own account with two of its collapsed hedge
funds without informing the funds' independent directors in
advance, Jennifer Levitz of the Wall Street Journal reports,
citing people familiar with the issue. The state believes that
it has a standing on behalf of some residents who invested in
the Funds.
Bear Stearns High-Grade Structured Credit Strategies Master
Fund, Ltd., and Bear Stearns High-Grade Structure Credit
Strategies Enhanced Fund, Ltd., filed liquidation proceedings in
the Grand Court of Cayman Islands in July 2007. The Funds'
collapse has cost about US$1,600,000,000 loss to investors, the
Journal says.
According to the Journal, the Massachusetts investigation seems
to be the first suggestion that potential conflicted trading at
Bear Stearns is being scrutinized. Massachusetts regulators
have found "a material number of principal transactions" between
Bear Stearns Cos. and the hedge funds, the Journal further cites
people familiar with the investigation.
The Journal found that the Bear Stearns Funds' offering
memorandum listed 12 types of arrangement that could lead to
conflict, including handling brokerage business for the funds,
allocating positions between the funds and other entities
managed by Bear Stearns Cos., valuing the assets of
partnerships, and lending to the funds.
The Funds' memorandum note that federal securities law mandates
that any investment adviser whose affiliates engage in principal
trading with clients must obtain their consent in writing in
advance, and Bear Stearns Asset Management, the Funds'
investment manager, promised in the memorandum that it would
obtain consent from the directors, the Journal says.
The Funds each had the same five directors, three of whom were
affiliated with Bear Stearns Cos. The memorandum identified
Scott P. Lennon and Michelle Wilson-Clarke, both executives at
Walkers SPV, Ltd., a fund administrator in the Cayman Islands,
as the independent directors, the Journal notes.
Howard Schiffman, a securities lawyer and former enforcement
lawyer at the Securities and Exchange Commission, related to the
Journal that advance disclosure of so-called principal trades is
a "longstanding principle" for investment companies and that "a
fund could be accused of breaching fiduciary duty if proper
disclosure was not made."
The Massachusetts regulators are also looking at why Bear
Stearns research analysts upgraded subprime lender New Century
Financial Corp., from "sell" to "neutral" on March 1, 2007,
before the company filed for Chapter 11, the Journal relates.
Russell Sherman, a Bear Stearns Cos. spokesperson, related to
the Journal that the company is cooperating with all inquiries
about the two funds but provided no comment on the
investigation.
The U.S. Attorney's office in Brooklyn and the U.S. Securities
and Exchange Commission each are also examining the
circumstances of the Funds' collapse.
About Bear Stearns Funds
Grand Cayman, Cayman Islands-based Bear Stearns High-Grade
Structured Credit Strategies Enhanced Leverage Master Fund Ltd.
and Bear Stearns High-Grade Structured Credit Strategies Master
Fund Ltd. are open-ended investment companies, which sought high
income and capital appreciation relative to the London Interbank
Offered Rate, and designed for long-term investors.
On July 30, 2007, the Funds filed winding up petitions under the
Companies Law (2007 Revision) of the Cayman Islands. Simon
Lovell Clayton Whicker and Kristen Beighton at KPMG were
appointed joint provisional liquidators. The joint liquidators
filed for Chapter 15 petitions before the U.S. Bankruptcy Court
for the Southern District of New York the next day. On
Aug. 30, 2007, the Honorable Burton R. Lifland denied the Funds
protection under Chapter 15 of the Bankruptcy Code.
Fred S. Hodara, Esq., Lisa G. Beckerman, Esq., and David F.
Staber, Esq., at Akin Gump Strauss Hauer & Feld LLP, represent
the liquidators in the United States. The Funds' assets and
debts are estimated to be more than US$100,000,000 each. (Bear
Stearns Funds Bankruptcy News; Bankruptcy Creditors' Service
Inc.; http://bankrupt.com/newsstand/or 215/945-7000).
BMIT CORP: Proofs of Claim Filing Deadline Is Nov. 19
-----------------------------------------------------
BMIT Corporation's creditors are given until Nov. 19, 2007, to
prove their claims to Toshio Nakahara, 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.
BMIT's shareholder agreed on Sept. 20, 2007, to place the
company into voluntary liquidation under The Companies Law (2004
Revision) of the Cayman Islands.
The liquidator can be reached at:
Toshio Nakahara
BMIT Corporation
5-1, Kita-Aoyama
2-chome Minato-ku
Tokyo 107-8077, Japan
Phone: +81 3 3497 7541
Fax: +81 3 3497 3177
FIRST CAYMAN: Will Pay Final Dividend to Creditors
--------------------------------------------------
The First Cayman Bank Ltd.'s liquidators disclosed their
intention to pay a final dividend to all admitted creditors of
the bank, as soon as all necessary legal requirements have been
met.
The liquidators expect that the dividend will be paid by the end
of this year.
All creditors whose claims have been accepted and have received
at least one dividend payment in the past need take no further
action, as long as their current address is known to the
liquidators. All other potential creditors must file a Proof of
Debt form with the liquidators by Nov. 19, 2007.
Any creditor unsure of their status or requiring further
information should contact the liquidators at:
The Joint Official Liquidators
First Cayman Bank Ltd.
P. O. Box 1113, Grand Cayman KY1-1102
Cayman Islands
Phone: 1 345 949 5266
GAMMA: Proofs of Claim Filing Deadline Is Nov. 19
-------------------------------------------------
Gamma Relativity International Fund's creditors are given until
Nov. 19, 2007, to prove their claims to Gamma Investors
Administrator LLC, 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.
Gamma Relativity's shareholder agreed on Sept. 27, 2007, to
place the company into voluntary liquidation under The Companies
Law (2004 Revision) of the Cayman Islands.
The liquidator can be reached at:
Gamma Investors Administrator LLC
Attention: Nicholas Nusbaum
55 Croton Road, Ste. 111
King of Prussia, PA 19406
Telephone: (610) 265-8116
Fax: (610) 265-7245
GAMMA GLOBAL: Proofs of Claim Filing Ends on Nov. 19
----------------------------------------------------
Gamma Global Market Neutral Fund's creditors are given until
Nov. 19, 2007, to prove their claims to Gamma Investors
Administrator LLC, 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.
Gamma Global's shareholder agreed on Sept. 27, 2007, to place
the company into voluntary liquidation under The Companies Law
(2004 Revision) of the Cayman Islands.
The liquidator can be reached at:
Gamma Investors Administrator LLC
Attention: Nicholas Nusbaum
55 Croton Road, Ste. 111
King of Prussia, PA 19406
Telephone: (610) 265-8116
Fax: (610) 265-7245
GAMMA RELATIVITY: Proofs of Claim Filing Is Until Nov. 19
---------------------------------------------------------
Gamma Relativity Low Vol Offshore Fund's creditors are given
until Nov. 19, 2007, to prove their claims to Gamma Investors
Administrator LLC, 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.
Gamma Relativity's shareholder agreed on Sept. 27, 2007, to
place the company into voluntary liquidation under The Companies
Law (2004 Revision) of the Cayman Islands.
The liquidator can be reached at:
Gamma Investors Administrator LLC
Attention: Nicholas Nusbaum
55 Croton Road, Ste. 111
King of Prussia, PA 19406
Telephone: (610) 265-8116
Fax: (610) 265-7245
GAMMA RELATIVITY INT'L: Proofs of Claim Filing Ends on Nov. 19
--------------------------------------------------------------
Gamma Relativity International Offshore Fund II's creditors are
given until Nov. 19, 2007, to prove their claims to Gamma
Investors Administrator LLC, 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.
Gamma Relativity's shareholder agreed on Sept. 27, 2007, to
place the company into voluntary liquidation under The Companies
Law (2004 Revision) of the Cayman Islands.
The liquidator can be reached at:
Gamma Investors Administrator LLC
Attention: Nicholas Nusbaum
55 Croton Road, Ste. 111
King of Prussia, PA 19406
Telephone: (610) 265-8116
Fax: (610) 265-7245
GAMMA RELATIVITY INT'L OFFSHORE: Claims Filing Is Until Nov. 19
---------------------------------------------------------------
Gamma Relativity International Offshore Fund's creditors are
given until Nov. 19, 2007, to prove their claims to Gamma
Investors Administrator LLC, 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.
Gamma Relativity's shareholder agreed on Sept. 27, 2007, to
place the company into voluntary liquidation under The Companies
Law (2004 Revision) of the Cayman Islands.
The liquidator can be reached at:
Gamma Investors Administrator LLC
Attention: Nicholas Nusbaum
55 Croton Road, Ste. 111
King of Prussia, PA 19406
Telephone: (610) 265-8116
Fax: (610) 265-7245
GAMMA RELATIVITY LOW: Proofs of Claim Filing Ends on Nov. 19
------------------------------------------------------------
Gamma Relativity Low Vol Fund's creditors are given until
Nov. 19, 2007, to prove their claims to Gamma Investors
Administrator LLC, 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.
Gamma Relativity's shareholder agreed on Sept. 27, 2007, to
place the company into voluntary liquidation under The Companies
Law (2004 Revision) of the Cayman Islands.
The liquidator can be reached at:
Gamma Investors Administrator LLC
Attention: Nicholas Nusbaum
55 Croton Road, Ste. 111
King of Prussia, PA 19406
Telephone: (610) 265-8116
Fax: (610) 265-7245
PARMALAT SPA: Parma Prosecutors Can Prove BofA Link, Report Says
----------------------------------------------------------------
Prosecutors at Parma, Italy said they can prove a link between
former Parmalat S.p.A. chief financial officer Fausto Tonna and
former Bank of America Corp. Italian chief Luca Sala, Reuters
reports citing chief prosecutor Gerardo La Guardia.
Mr. La Guardia told Reuters that magistrates have evidence of
bank transfers by Mr. Tonna to Mr. Sala via a Swiss bank
account.
Prosecutors believe that some of BofA's executives were aware of
Parmalat's financial condition before it collapsed in December
2003 under a EUR14 billion debt, Mr. La Guardia added to
Reuters. Prosecutors also believe that the bank's management
benefited from the transfers.
The chief prosecutor added that the magistrates are continuing
their investigations.
Denial
Mr. Tonna denied any collusion with Mr. Sala, saying that he
"never ordered payments of such nature," Reuters relates.
"We have seen no evidence that any Bank of America executives
were aware of the fraud at Parmalat," a bank spokesperson was
quoted by Reuters.
Mr. Tonna, along with Parmalat former CEO Calisto Tanzi and 14
former group executives and accountants, is on trial in Milan on
charges of market rigging, false accounting and contravening of
local stock market laws.
About Parmalat
Headquartered in Milan, Italy, Parmalat S.p.A. --
http://www.parmalat.net/-- sells nameplate milk products that
can be stored at room temperature for months. It also has about
40 brand product lines, which include yogurt, cheese, butter,
cakes and cookies, breads, pizza, snack foods and vegetable
sauces, soups and juices.
The Company's U.S. operations filed for chapter 11 protection on
Feb. 24, 2004 (Bankr. S.D.N.Y. Case No. 04-11139). Gary
Holtzer, Esq., and Marcia L. Goldstein, Esq., at Weil Gotshal &
Manges LLP, represent the Debtors. When the U.S. Debtors filed
for bankruptcy protection, they reported more than US$200
million in assets and debts. The U.S. Debtors emerged from
bankruptcy on April 13, 2005.
Parmalat S.p.A. and its Italian affiliates filed separate
petitions for Extraordinary Administration before the Italian
Ministry of Productive Activities and the Civil and Criminal
District Court of the City of Parma, Italy on Dec. 24, 2003.
Dr. Enrico Bondi was appointed Extraordinary Commissioner in
each of the cases. The Parma Court has declared the units
insolvent.
On June 22, 2004, Dr. Bondi filed a Sec. 304 Petition, Case No.
04-14268, in the United States Bankruptcy Court for the Southern
District of New York.
Parmalat has three financing arms: Dairy Holdings Ltd., Parmalat
Capital Finance Ltd., and Food Holdings Ltd. Dairy Holdings and
Food Holdings are Cayman Island special-purpose vehicles
established by Parmalat S.p.A. The Finance Companies are under
separate winding up petitions before the Grand Court of the
Cayman Islands. Gordon I. MacRae and James Cleaver of Kroll
(Cayman) Ltd. serve as Joint Provisional Liquidators in the
cases. On Jan. 20, 2004, the Liquidators filed Sec. 304
petition, Case No. 04-10362, in the United States Bankruptcy
Court for the Southern District of New York. In May 2006, the
Cayman Island Court appointed Messrs. MacRae and Cleaver as
Joint Official Liquidators. Gregory M. Petrick, Esq., at
Cadwalader, Wickersham & Taft LLP, and Richard I. Janvey, Esq.,
at Janvey, Gordon, Herlands Randolph, represent the Finance
Companies in the Sec. 304 case.
The Honorable Robert D. Drain presides over the Parmalat
Debtors' U.S. cases.
SAMLEY FUND: Proofs of Claim Filing Deadline Is Nov. 18
-------------------------------------------------------
Samley Fund LLC's creditors are given until Nov. 18, 2007, to
prove their claims to John Cullinane and Derrie Boggess, the
company's liquidators, 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.
Samley Fund's shareholder agreed on Oct. 19, 2007, to place the
company into voluntary liquidation under The Companies Law (2004
Revision) of the Cayman Islands.
The liquidators can be reached at:
John Cullinane
Derrie Boggess
c/o Walkers SPV Limited
Walker House, 87 Mary Street
George Town, Grand Cayman KY1-9002
Cayman Islands
Telephone: (345) 914-6305
=========
C H I L E
=========
AES CORP: Reports US$103-Mil. Net Income in Qtr. Ended Sept. 30
---------------------------------------------------------------
The AES Corporation reported net income of US$103 million for
the three months ended Sept. 30, 2007, compared to a net loss of
US$327 million for the same period in 2006.
During the quarter, revenues increased by US$524 million or 18%
to US$3.5 billion. The increase in revenues reflects higher
rates and volumes of approximately US$284 million in Latin
America, North America and Europe & Africa, favorable foreign
currency translation of approximately US$174 million and
contributions from TEG and TEP, two plants in Mexico the company
acquired in first quarter 2007, of approximately US$57 million.
Gross margin increased by US$14 million or 2% to US$840 million,
primarily due to higher prices in North America and
contributions from TEG and TEP as well as the impacts of
favorable foreign currency translation, a combined impact of
approximately US$106 million. These gains were partially offset
by the impacts of gas curtailments and lower hydrology at the
company's businesses in Argentina and Chile of approximately
US$112 million.
During the quarter, net cash from operating activities decreased
by US$187 million to US$741 million. This decrease was
primarily due to the sale of a Venezuelan subsidiary, C.A. LA
Electricidad de Caracas, in May 2007. Excluding any
contribution from EDC, net cash from operating activities would
have decreased by approximately US$19 million.
During the quarter, the Company was the winning bidder on two
projects totaling 1,762 MW in the Philippines and the Republic
of South Africa. Additionally, the company's Alternative Energy
group announced plans to begin construction of a 170 MW
expansion of its Buffalo Gap wind farm in Texas. Once
completed, the project will increase capacity at Buffalo Gap to
524 MW, making it one of the largest operating wind farms in the
United States.
"We are pleased with our continued progress toward achieving our
growth goals, such as winning two strategically important
projects in the Philippines and South Africa. These investments
will be platforms for further expansion in these two high growth
markets," said Paul Hanrahan, AES President and CEO. "In
October, the market gave us a vote of confidence when our US$500
million offering of unsecured notes generated significant demand
and was successfully upsized to US$2 billion. This transaction
will help us to achieve more flexibility in our existing capital
structure, as we were able to refinance existing debt, and will
support our growth program."
Third Quarter 2007 Segment Highlights
Latin America Generation revenue increased by US$229 million to
US$914 million, primarily due to higher rates in Chile and
Argentina of approximately US$150 million and approximately
US$32 million in higher intercompany sales at Tiete in Brazil.
Gross margin decreased by US$84 million to US$183 million,
primarily due to higher costs associated with gas supply
curtailments and lower hydrology in Chile and Argentina of
approximately US$112 million, partially offset by increased
intercompany sales at Tiete.
Latin America Utility revenue increased by US$141 million to
US$1.3 billion, primarily due to approximately US$135 million in
favorable foreign currency translation and approximately US$26
million in increased volumes at Eletropaulo in Brazil, partially
offset by decreased rates at Eletropaulo due to the 2007 tariff
reset. Gross margin increased by US$71 million to US$259
million, primarily due to approximately US$55 million in
favorable foreign currency translation and approximately US$33
million in lower costs in Brazil.
North America Generation revenue increased by US$76 million to
US$566 million, primarily due to approximately US$57 million in
contributions from the newly acquired TEG and TEP businesses in
Mexico and approximately US$25 million in higher rates and
volumes at Eastern Energy in New York. Gross margin increased
by US$47 million to US$196 million, primarily due to the higher
rates and volumes as well as lower costs at Eastern Energy, an
impact of approximately US$34 million, and contributions from
TEG and TEP of approximately US$20 million.
North America Utility revenue remained flat at US$274 million.
Consistent with revenues, gross margin remained relatively flat
with a decrease of US$3 million to US$86 million.
Europe & Africa Generation revenue increased by US$20 million to
US$216 million, primarily due to increased rates and volumes of
approximately US$15 million in Kazakhstan and approximately US$3
million in favorable foreign currency translation. Gross margin
decreased by US$3 million, primarily due to decreased sales of
excess emission allowances in Hungary.
Europe & Africa Utility revenue increased by US$26 million to
US$157 million, primarily due to increased rates of
approximately US$14 million in Ukraine and approximately US$6
million in favorable foreign currency translation. Gross margin
decreased by US$8 million, primarily due to the reversal of
approximately US$7 million in VAT tax accrual during third
quarter 2006 at SONEL in Cameroon.
Asia Generation revenue increased by US$44 million to US$235
million, primarily due to higher dispatch in Pakistan and higher
volume in Sri Lanka. Gross margin decreased by US$6 million to
US$47 million, primarily due to lower volumes in China.
Increased revenue in Pakistan and Sri Lanka had a relatively
flat impact on gross margin due to related increases in fuel
costs.
AES Corp. -- http://www.aes.com/-- is a global power company.
The company operates in South America, Europe, Africa, Asia and
the Caribbean countries. Specifically, it also has operations
in India. Generating 44,000 megawatts of electricity through
124 power facilities, the company delivers electricity through
15 distribution companies. The company's Latin America business
group is comprised of generation plants and electric utilities
in Argentina, Brazil, Chile, Colombia, Dominican Republic, El
Salvador, Panama and Venezuela.
As reported in the Troubled Company Reporter-Latin America on
Oct. 12, 2007, Moody's Investors Service affirmed The AES
Corporation's Corporate Family Rating at B1 and the senior
unsecured rating assigned to its new senior unsecured notes
offering at B1 following its upsizing to US$2 billion from
US$500 million. LGD assessments are subject to change pending
the final capital structure.
As reported on Oct. 12, 2007, Fitch Ratings assigned a 'BB/RR1'
rating to AES Corporation's US$500 million issue of senior
unsecured notes due 2017. AES' long-term Issuer Default Rating
is rated 'B+' by Fitch. Fitch said the rating outlook is
stable.
BOSTON SCIENTIFIC: Announces Data Integration w/ GE Healthcare
--------------------------------------------------------------
Boston Scientific Corporation and GE Healthcare has announced
the industry's first patient data integration between a cardiac
rhythm management remote monitoring system and a physician's
electronic medical record, currently installed at Seattle
Cardiology and Cardiology Consultants of Philadelphia.
The integration uses Boston Scientific's LATITUDE(R) Patient
Management system to allow clinicians to access information from
a patient's implanted cardiac device and store within the GE
Centricity(R) Electronic Medical Record system in the form of
lab results.
"Having electronic access to a more comprehensive medical record
enables me to provide even better care for my device patients,"
said R. Jeffrey Westcott, M.D., Director, Cardiac
Catheterization Laboratory, Swedish Heart and Vascular
Institute, Seattle, Washington. "The additional upside is less
paperwork and the ability to easily collaborate with other
physicians who are managing other aspects of the patient's
care."
"The collaboration between GE Healthcare and Boston Scientific
provides a more comprehensive patient record and enables
physicians to make more accurate decisions regarding their
patients," said Dr. Scott Hessen, Chief, Clinical Cardiac
Electrophysiology, Cardiology Consultants of Philadelphia,
Pennsylvania.
GE's Centricity EMR is an electronic medical record system that
enables ambulatory care physicians and clinical staff to
document patient encounters, streamline clinical workflow, and
securely exchange clinical data with other providers, patients,
and information systems. Among the most widely used ambulatory
care electronic medical records, Centricity EMR empowers
healthcare providers to deliver the highest quality of care at
lower costs.
Boston Scientific's LATITUDE Patient Management system is
designed to remotely monitor specific device and cardiac status
information for physicians, which gives patients peace of mind
knowing their device is being monitored on a scheduled basis.
Since LATITUDE Patient Management was first introduced in 2005,
more than 70,000 patients have been enrolled on the system at
more than 1,700 clinics across the United States. The system is
designed to promote compliance among patients while also
enabling physicians to intervene earlier in a patient's care
with actionable data.
Available as an optional component to the LATITUDE Patient
Management system is the industry's first and only wireless
weight scale and blood pressure cuff, which is aligned with the
ACC/AHA physician society guidelines that recommend monitoring
weight and blood pressure.
About GE Healthcare
GE Healthcare provides transformational medical technologies and
services that are shaping a new age of patient care. GE
Healthcare's expertise in medical imaging and information
technologies, medical diagnostics, patient monitoring systems,
performance improvement, drug discovery, and biopharmaceutical
manufacturing technologies is helping clinicians around the
world re-imagine new ways to predict, diagnose, inform, treat
and monitor disease, so patients can live their lives to the
fullest.
Headquartered in the United Kingdom, GE Healthcare --
http://www.gehealthcare.com-- is a US$17 billion unit of
General Electric Company (NYSE: GE). Worldwide, GE Healthcare
employs more than 46,000 people committed to serving healthcare
professionals and their patients in more than 100 countries.
About Boston Scientific
Headquartered in Natick, Massachusetts, Boston Scientific
Corporation (NYSE: BSX) -- http://www.bostonscientific.com/
-- develops, manufactures and markets medical devices used in a
broad range of interventional medical specialties. The company
has offices in Argentina, Chile, France, Germany, and Japan,
among others.
* * *
As reported in the Troubled Company Reporter-Latin America on
Oct. 24, 2007, Standard & Poor's Ratings Services affirmed its
ratings on Natick, Massachussetts-based Boston Scientific Corp.
(including the 'BB+' corporate credit rating) and removed them
from CreditWatch, where they were placed with negative
implications Aug. 3, 2007.
BOSTON SCIENTIFIC: Selling Cardiac & Vascular Biz for US$750 Mln
----------------------------------------------------------------
Boston Scientific Corporation signed a definitive agreement for
the sale of its Cardiac Surgery and Vascular Surgery businesses
to the Getinge Group for a cash price of US$750 million and
is expected to close within the next 45-90 days, subject to
regulatory approvals and customary conditions.
The company disclosed its intent to sell the Cardiac Surgery and
Vascular Surgery businesses on Aug. 16, as part of its plan to
divest non-strategic assets and increase shareholder value.
Boston Scientific acquired the Cardiac Surgery business in April
2006 as part of the Guidant transaction.
The Cardiac Surgery business is a developer of medical
technologies designed for use in surgical cardiac procedures,
including beating-heart bypass surgery systems and endoscopic
vessel harvesting for coronary bypass surgery. The business
employs approximately 450 people.
Boston Scientific acquired the Vascular Surgery business in
1995. The Vascular Surgery business develops synthetic grafts
and patches used to surgically treat vascular disease, including
the repair of abdominal aortic aneurysms and peripheral vascular
anatomy. The business has approximately 250 employees. The
combined revenues of the two businesses in 2006 were
approximately US$275 million.
"Working with the talented employees of the Cardiac Surgery and
Vascular Surgery businesses, our goal is to drive growth and
bring new technologies to these markets, ultimately benefiting
cardiac and vascular surgeons and their patients," Johan
Malmquist, president and chief executive officer of the Getinge
Group of Stockholm, Sweden, said. "We are excited to complement
our existing portfolio with these valuable businesses, each of
which brings leading market positions and impressive product
lines."
"This transaction completes an element of our plan to divest
non-strategic assets, focus on our core businesses and increase
shareholder value," Jim Tobin, president and chief executive
officer of Boston Scientific, said. "We deeply appreciate the
contributions our Cardiac Surgery and Vascular Surgery employees
have made to Boston Scientific, our customers and their
patients. We know they will continue to serve customers
and patients well going forward."
About Getinge Group
Headquartered in Rochester, New York, The Getinge Group
-- http://www.getinge.com/-- is a provider of equipment and
systems to customers within health care, extended care and
pharmaceutical industries/laboratories. The Group comprises
three business areas: Medical Systems (systems for surgery and
intensive care), Infection Control (system equipment for
disinfection and sterilization) and Extended Care (care
ergonomics). The Group maintains positions within the majority
of the company's product lines.
About Boston Scientific
Headquartered in Natick, Massachusetts, Boston Scientific
Corporation (NYSE: BSX) -- http://www.bostonscientific.com/
-- develops, manufactures and markets medical devices used in a
broad range of interventional medical specialties. The company
has offices in Argentina, Chile, France, Germany, and Japan,
among others.
* * *
As reported in the Troubled Company Reporter-Latin America on
Oct. 24, 2007, Standard & Poor's Ratings Services affirmed its
ratings on Natick, Massachussetts-based Boston Scientific Corp.
(including the 'BB+' corporate credit rating) and removed them
from CreditWatch, where they were placed with negative
implications Aug. 3, 2007.
EASTMAN KODAK: Launches New Manufacturing Plant in Xiamen, China
----------------------------------------------------------------
Eastman Kodak Company has opened the world's newest printing
plate manufacturing facility in Xiamen, China. The state-of-
the-art Kodak facility will produce both digital and
conventional printing plates for the growing China market and
Asia Pacific region.
"This is an important occasion for our commercial printing
customers in China and around the world. Kodak's $50 million
investment in plate manufacturing in China demonstrates our
strong commitment to offset printing and strengthening our
position in the Graphic Communications industry," said Philip J.
Faraci, President and Chief Operating Officer, Eastman Kodak
Company, during a plant opening ceremony. "The Xiamen plant
significantly increases our total manufacturing capacity
worldwide, which is critical to our customers as the demand for
computer to plate printing solutions continues to grow. It also
provides a base of operations to increase our service and
support for customers in China and the Asia Pacific."
Approximately 350 people attended the official opening
ceremonies, including Faraci and the following Kodak
representatives:
* Andrew Copley, Chief Operating Officer, Graphic
Communications Group and Vice President, Eastman
Kodak Company;
* Ying Yeh, Chairman and President, North Asia Region and
Vice President, Eastman Kodak Company;
* Jeff Hayzlett, Chief Business Development Officer and Vice
President, Eastman Kodak Company;
* Gustavo Oviedo, Managing Director, Asia Pacific Region, and
Vice President, GCG; and
* John Robinson, General Manager and Vice President, Printing
Plate Business, Prepress Solutions, GCG.
Among the other attendees representing the Chinese government
and printing industry were:
* Mr. Yongzhan Yu, former Vice Minister of the General
Administration of Press and Publication of the P.R.C,
Chairman of the Printing Technology Association of China;
* Mr. Xinli Li, Deputy Director of Shanghai Press and
Publication Administration;
* Mr. Hao Yu, Director of Xiamen Press & Publication
Administration;
* Mr. Wenxiang Wu, The Honour Chairman of Printing Technology
Association of China; and
* Mr. Shuangru Zhang, Vice Chairman of Printing Technology
Association of China.
The new facility is located at Kodak's research and
manufacturing center in Xiamen. Occupying nearly 21,000 square
meters, the new plant will produce KODAK ELECTRA EXCEL Thermal
Plates. Considered the largest selling digital plate ever, the
ELECTRA EXCEL plate is a no preheat thermal plate that delivers
excellent versatility and reliability for a wide range of
printing applications. In addition to digital plate production,
the Kodak Xiamen plant will also meet the strong demand in China
for conventional printing plates.
"Our Xiamen plant will incorporate Kodak printing plate
production expertise from around the world into what we believe
is the most advanced plate manufacturing facility anywhere,"
said Mr. Robinson. "The team in Xiamen is experienced and
highly qualified. Many of our employees come from Kodak's other
operations in Xiamen. They are skilled in the process
manufacturing required for high-quality plate production, as
well as in Kodak's quality standards and LEAN manufacturing
practices."
Along with the new facility in Xiamen, Kodak is creating a
dedicated China Technical Applications Group (TAG) to provide
technical support to customers in China and the Asia Pacific.
Kodak already has TAG operations serving Europe and the
Americas.
In addition to the Xiamen plant, there are seven other Kodak
plate production facilities around the world, including: Munich,
Germany; Osterode, Germany; Leeds, U.K., Sofia, Bulgaria; Gunma,
Japan; Windsor, Colo., U.S.; and Columbus, Ga., U.S.
Kodak's leading plate portfolio includes flexographic, sheet-fed
and web offset printing solutions for commercial, newspaper, and
packaging printers. Kodak invented thermal plates in 1995 with
the introduction of the Direct Image Thermal Plate, and since
then has led the way in innovative CTP solutions.
Kodak's printing plates are part of a full-solution portfolio,
including a broad range of proofing choices and platesetters, as
well as the widely accepted KODAK PRINERGY Workflow System. In
proofing, Kodak offers digital halftone, inkjet, virtual and
analog proofing. In platesetting, customers can select
equipment that leads the industry, including KODAK TRENDSETTER
and MAGNUS CTP Platesetters, using KODAK SQUARESPOT Imaging
Technology to provide exceptionally high-resolution images. In
addition, KODAK STACCATO Screening offers high fidelity,
continuous tone images that exhibit fine detail and an extended
color gamut.
"With manufacturing in eight plants on three different
continents, Kodak is able to produce plate solutions that are
tailored to the regions where are customers are doing business,"
Mr. Robinson said. "The Xiamen plant solidifies Kodak's plate
leadership around the world."
About Eastman Kodak
Headquartered in Rochester, New York, Eastman Kodak Co. (NYSE:
EK)-- http://www.kodak.com/-- develops, manufactures, and
markets digital and traditional imaging products, services, and
solutions to consumers, businesses, the graphic communications
market, the entertainment industry, professionals, healthcare
providers, and other customers.
The company has operations in Argentina, Chile, Denmark, Greece,
Jordan, Yemen, Australia, China among others.
As reported in the Troubled Company Reporter-Latin America on
Sept. 14, 2007, Standard & Poor's Ratings Services has affirmed
its 'B+' corporate credit rating on Eastman Kodak Co. and
removed the ratings from CreditWatch, where they had been placed
with negative implications on Aug. 2, 2006. S&P said the
outlook is negative.
REVLON INC: Sept. 30 Balance Sheet Upside-Down by US$1.1 Billion
----------------------------------------------------------------
Revlon Inc.'s balance sheet as of Sept. 30, 2007, showed
US$882.4 million in total assets and US$2.03 billion in total
liabilities, resulting in a total stockholders' deficit of
US$1.1 billion.
For the three months ended Sept. 30, 2007, the company posted a
net loss of US$10.4 million compared to a net loss of US$100.5
million for the same period in 2006.
The company's net sales in the third quarter of 2007 increased
11.0% to US$339.7 million, compared to net sales of US$305.9
million in the third quarter of 2006. Excluding the impact of
foreign currency fluctuations, net sales in the third quarter
increased 8.6% versus year-ago. Third quarter 2006 net sales
were reduced by approximately US$15 million from Vital Radiance.
Commenting on the company's market share results, Mr. Kennedy
said, "In the third quarter 2007, Revlon color cosmetics market
share declined year-over-year, which reflected a decrease in
market share by products launched in prior years, offset, in
part, by positive performance from new products launched in the
second half of 2006 and in 2007. On a sequential basis, since
the fourth quarter 2006, the Revlon brand has maintained an
approximate 13% dollar share."
Mr. Kennedy continued, "In the third quarter 2007, Revlon's
positive performance in the eye category was more than offset by
declines in the face, lip and nail categories. Revlon's
positive performance in the eye category was driven by the
Limited Edition Eye Collection, Luxurious Color Eyeliner and 3D
Extreme Mascara, which were all launched in 2007. In the third
quarter 2007, Almay's positive performance in the face category
was offset by declines in the lip and eye categories. Almay's
positive performance in the face category was driven by the
recently launched Smart Shade Makeup, and by its new line
extensions, Smart Shade Blush and Bronzer. In the third quarter
and first nine months of 2007, we continued to competitively
support our existing brands worldwide with increased dollar
spending versus last year."
2008 New Product Lineup
Revlon is focused on building and leveraging its strong brands
and believes that consistent development and marketing of
innovative new products is a key driver for building brand
equity and profitable growth. For 2008, the Company will
introduce an extensive new product lineup of Revlon and Almay
color cosmetics. These product launches include differentiated
and unique offerings for the mass channel, innovations in
products and packaging, new technologies, exciting styles and
extensions within the Revlon and Almay power franchises. The
company intends to continue its strategy of supporting new
products with advertising and promotions, at competitive levels,
using its talented spokesmodels.
Company Strategy
In conclusion, Mr. Kennedy said, "We continue to execute our
business strategy.
(1) Building and leveraging our strong brands -- throughout
2007 we launched several exciting new products in our
core brands and are supporting these launches at
competitive levels. As noted, we believe we have an
exciting and strong 2008 new product lineup;
(2) Improving the execution of our strategies and plans, and
providing for continued improvement in our organizational
capability through enabling and developing our employees
-- effective Oct. 1, 2007, we established a U.S. region
and appointed Chris Elshaw as General Manager to run this
significant part of our business. This organizational
change is providing the focus and continued clear
accountability to grow the U.S. business profitably.
Prior to his new role, Chris successfully grew our
business in Europe and Canada for the past five years as
Managing Director of our Europe region;
(3) Continuing to strengthen our international business -- we
continue to strengthen our international business by
leveraging our U.S.-based Revlon brand marketing, as well
as our strong regional brands. In third quarter and
first nine months of 2007, international operating
profits and margins continued to improve compared to the
same periods last year;
(4) Improving our operating profit margins and cash flow --
we are focusing on sales growth and expect continuing,
sustainable benefits from our restructuring actions and
ongoing cost controls; and
(5) Improving our capital structure -- In September 2007, we
entered into a US$150 million two-year floating-to-fixed
interest rate swap transaction related to indebtedness
under our term loan in order to reduce our exposure to
interest rate volatility. We plan to refinance the
remaining balance of our 8 5/8% senior subordinated notes
in the fourth quarter of 2007."
About Revlon Inc.
Revlon Inc. (NYSE: REV) -- http://www.revloninc.com/-- Revlon
is a worldwide cosmetics, skin care, fragrance, and personal
care products company. The company's vision is to deliver the
promise of beauty through creating and developing the most
consumer preferred brands. The company's brands, which are sold
worldwide, include Revlon(R), Almay(R), Ultima(R), Charlie(R),
Flex(R), and Mitchum(R). The company's Latin American
operations are located in Argentina, Brazil, Chile, Mexico and
Venezuela.
THERMADYNE HOLDINGS: Earns US$1 Million in Qtr. Ended Sept. 30
--------------------------------------------------------------
Thermadyne Holdings Corporation reported financial results for
the three months ended Sept. 30, 2007.
For the 2007 third quarter, net income from continuing
operations was US$1.3 million with net income of US$1.0 million,
after US$0.3 million of net loss from discontinuing operations.
In comparison, the third quarter of 2006 was a net loss of
US$5.7 million, including a net loss of US$0.2 million from
discontinued operations during that period.
Net sales in the 2007 third quarter rose to US$126.6 million, an
increase of 11.4% from the same quarter of 2006. Excluding the
impact of foreign currency translations, net sales increased
8.2% for the three-month period ending Sept. 30, 2007.
"Excluding the impact of foreign currency translation, our
international sales increased 15% year-to-year in the three-
month period. Momentum from prior initiatives in these markets
appears to be building as this quarterly result is ahead of the
nine-month pace of 13% year-to-year growth. Our successful
product strategies, enhanced sales efforts and the weaker U.S.
dollar have created a favorable climate for the full range of
our products," said Paul D. Melnuk, Chairman and Chief Executive
Officer. "U.S. market sales growth of mid-single digit over
last year's third quarter is encouraging, since we have
eliminated certain products and customers that didn't meet our
return objectives this year," he added.
Gross profit in the third quarter of 2007 increased to US$38.1
million, or 30.1% of net sales, as compared to US$33.5 million,
or 29.5% of net sales, in the third quarter period of 2006.
Gross profit for the nine months ended Sept. 30, 2007 increased
to US$114.5 million, or 30.8% of net sales, as compared to
US$97.7 million, or 28.8% of net sales, in the prior-year nine-
month period.
"In the third quarter, the trend of improving gross profit
margin percentage continued albeit at lower levels than earlier
in the year due to ongoing commodity material cost inflation
being higher than anticipated. We estimate that these commodity
inflationary increases added another US$6 million to our raw
material and supply costs during the third quarter and US$18
million year-to-date. A number of commodities, including
copper, brass, nickel and petroleum-related items, have all
posted double-digit increases again this year. In light of
these significant cost increases, we are not disappointed with
the margin improvement although we know we can and must do
better," commented Mr. Melnuk.
"For example, our August 2007 price increase does not appear to
have been a quick nor aggressive enough response to the
inflationary increases impacting our material costs as the price
increase did not show meaningful impact until late in the
quarter. In addition, although we continue to have great
success with our continuous cost improvement process 'TCP,'
which is ahead of plan for the year, we were not able to achieve
enough savings to offset inflation in the period," Mr. Melnuk
continued.
"Our gross margin of 30.8% for the first nine months of 2007
does reflect a 200 basis point improvement over the 28.8% of the
prior-year comparable period. Through the combination of cost
savings from our 'TCP' process as well as the full impact of the
recent price increase, we expect margins in the fourth quarter
to exceed the third-quarter gross margin performance levels and
the year-to-date performance," commented Mr. Melnuk.
Selling, general and administrative costs were US$27.2 million
in the third quarter of 2007, or 21.5% of net sales, compared
with US$26.0 million, or 22.9% of net sales, in the prior-year
third quarter, excluding US$2.8 million of incremental
accounting related and bondholder consent fees in the prior-year
period. Year-to-date selling, general and administrative costs
were 21.6% of net sales compared with 22.5% of net sales in the
prior-year comparable period, excluding US$6.1 million of
incremental accounting related and bondholder consent fees in
the prior-year period.
Other Income & Expense Items
Interest costs of US$6.7 million decreased US$0.3 million from
the third quarter of 2006, reflecting the Company's reduced
indebtedness and lower average interest rates following the June
2007 amendments to the Working Capital Facility and Second Lien
Facility Agreements, as well as the US$14 million pay down of
the Second Lien Facility indebtedness.
The income tax provision for the three period ending September
2007 was US$1.7 million, with effective rates of 56.9%.
Approximately 75% of the US$5.3 million tax provision is
attributable to foreign taxes, which are currently payable. The
portion of the income tax provision that is not currently
payable arises primarily from additional U. S. income taxes
accrued on earnings in foreign countries that may ultimately be
repatriated and for which the use of offsetting available
foreign tax credits is uncertain.
Operating EBITDA
In the third quarter of 2007, Operating EBITDA, as adjusted,
from continuing operations was US$14.5 million, or 11.5% of net
sales, compared to US$12.1 million, or 10.6% of net sales in the
third quarter of 2006. Operating EBITDA, as adjusted, was
US$14.4 million including the discontinued operations for the
third quarter of 2007, versus US$12.6 million for the third
quarter of 2006.
Divestitures & Discontinued Operations
In May 2007, the company completed the sale of its remaining
South African operations. The sales proceeds were approximately
US$13.8 million. The proceeds from the sale were used to reduce
the Second Lien Facility.
As announced in December 2006, the Company is in the process of
selling its manufacturing operations in Brazil and expects to
complete the disposition in 2007. Operational results of the
Brazilian and South African businesses are shown as discontinued
operations in the Company's 2007 financial statements.
Outlook
"As we have transitioned from the short-term 'crisis management'
environment of the prior few years to a more stable, longer-term
management approach in 2007, we have begun to launch more
innovative new products, particularly plasma and welding
equipment product lines. We are very pleased with the market
reaction to the unique features of our new plasma products as
orders are far exceeding our expectations since the limited
release on Oct. 1. Additionally, welding equipment sales,
although lower than expected, have grown at higher rates than
the business as a whole. The success of our new products will
allow us to build on the inroads we have already made through
our automated cutting line in penetrating new markets throughout
the world," Mr. Melnuk observed.
Mr. Melnuk continued: "With these new products and the benefits
of our three-tiered brand strategy, we are optimistic about
further international growth prospects for Thermadyne as we
approach 2008. We will continue to target our product lines in
markets outside the United States and build our international
sales capabilities. Within the U.S., improved delivery, one-
order/one-invoice and other customer service factors are being
recognized and valued in the market place with market share
gains. We are encouraged for the potential this creates to
build on the strength of our industry-leading brands. Despite
emerging concerns for the U.S. economy in general, the outlook
for steel consumption remains relatively strong, as heavy
industrial and infrastructure development continues.
Accordingly, we estimate that our U.S. sales should continue
throughout the fourth quarter at a pace comparable to what we
have experienced so far this year. We also expect international
market growth to continue for the remainder of this year and
into 2008."
Working Capital & Liquidity
"Our inventory and receivables management continue to be an area
of special focus. As we have seen throughout this year, our
inventory turns have improved to 3.5 times at September 2007,
despite inventory build to support new product launches, from
3.2 turns at September 2006. We expect to further improve turns
to 3.6, or better, by December 31, 2007, as compared with the
3.2 turns shown at Dec. 31, 2006. We have also made progress in
our billing practices and receivables management as indicated by
the days-sales-outstanding metric of 64.7 in September 2007
versus the September 2006 level of 66.7. This will continue to
be an area of focus for further improvement during 2008," Mr.
Melnuk stated.
As of Sept. 30, 2007, the company had combined cash and
availability under its Working Capital Facility of US$53 million
in comparison with US$35 million at Dec. 31, 2006.
About Thermadyne Holdings
Headquartered in St. Louis Missouri, Thermadyne Holdings
Corporation -- http://www.thermadyne.com/-- is a multi-national
manufacturer of welding and cutting products. The company has
operations in Malaysia, Indonesia, Singapore, Philippines,
Italy, Mexico, Chile and Brazil.
* * *
As reported in the Troubled Company Reporter-Latin America on
Aug. 17, 2007, Standard & Poor's Ratings Services raised its
ratings on Thermadyne Holdings Corp., including its corporate
credit rating to 'CCC+' from 'CCC'. In addition, Standard &
Poor's removed the ratings from CreditWatch with positive
implications, where they were placed on April 5, 2007. S&P said
the outlook is positive.
===============
C O L O M B I A
===============
COMPANIA DE DESAROLLO: S&P Affirms BB+ Rating on US$116MM Notes
---------------------------------------------------------------
Standard & Poor's Ratings Services has affirmed its 'BB+' senior
secured rating on Compania de Desarrollo Aeropuerto Eldorado
S.A.'s US$116 million 10.19% notes due 2011. The outlook is
stable.
"The 'BB+' rating on Compania Eldorado reflects a guarantee from
AEROCIVIL that provides the company a minimum level of revenues
if aircraft landings fall below a predetermined level. So far,
this revenue floor has been sufficient to meet annual debt
service obligations," said S&P's credit analyst Monica Ponce.
The strong connection between AEROCIVIL and the national
government and the tariff design, which lessens inflation and
currency risks, also support the rating. The tariff structure
provides AEROCIVIL with rate-setting flexibility and is designed
to generate landing fees to cover maintenance expenses and debt-
service payments. The airport is important to the city of
Bogota and to Colombia as the country's main aviation facility
in terms of enplaned domestic and international passenger
traffic and flight operations.
Offsetting these positive factors is a continued shortfall in
revenues resulting from lower than originally expected aircraft
landings. Compania Eldorado has had to rely on payments under
the minimum revenue guarantee from the Republic of Colombia's
AEROCIVIL to fully service its debt obligations. Also balancing
the ratings is the fact that only 30% of the minimum revenue
guarantee amount is held in cash in a trust fund for
bondholders. The fund is only replenished annually while debt
service is paid semiannually, leading to some concern about the
liquidity of the obligated payments. Furthermore, the guarantee
can be drawn on for certain limited purposes other than debt
service. The debt to AEROCIVIL, the Republic of Colombia, and
the company's owners is nonrecourse debt.
Total aircraft landings continue to recover, as evidenced by the
9.64% traffic growth in the first half of 2007 when compared to
the same period of the previous year. Meanwhile, in 2006, total
landings increased by 11.03% when compared to 2005.
International landings have kept on growing, reaching a 9.29%
growth rate in the first half of 2007. On the other side,
domestic aircraft landings reversed the decreasing trend
observed in the past. In 2006 they increased by 11.10%, and in
the first half of 2007 by 9.78%. This trend reflects the solid
economic growth in Colombia as proven by a GDP average growth of
around 5% during the past four years. Following the continuous
increase in demand, S&P expects landings to continue this
positive trend during the next years, reaching an average growth
rate of around 8%. The growth in landings in the medium to long
term will also be supported by the expansion of the El Dorado
airport. As a result, the utilization of the minimum revenues
guarantee will continue to drop in the coming years.
The transaction's liquidity consists of an annually funded
account equal to 30% of the minimum revenue guarantee for that
year. As in other project finance deals, there are no bank
facilities available. During the past couple of years, the
minimum revenue guarantee utilization continued to improve,
reaching less than 5% during 2007.
As of Oct. 31, 2007, total debt outstanding was US$52.78 million
and the next debt-service payment is in November 2007, for
US$6.96 million. S&P expects Eldorado Airport to continue to
cover its payments fully and on time.
The stable outlook reflects the outlook assigned to the Republic
of Colombia. The outlook also reflects Compania Eldorado's
dependence on the minimum-revenue guarantee from AEROCIVIL to
service its debt. A negative action on the rating could take
place if landings decline during the next years. In addition,
any rating action on the Republic of Colombia could also lead to
a rating action on the company.
Compania de Desarrollo Aeropuerto Eldorado SA is a special-
purpose corporation that was awarded a concession contract by
the Republic of Colombia's governmental unit, Unidad
Administrativa Especial de la Aeronautica Civil (AEROCIVIL), the
operator of Colombian airports and the nation's equivalent to
the U.S. Federal Aviation Administration. The company collects
all landing fees at the El Dorado international airport in
Bogota, Colombia through 2015. These fees, as well as minimum
revenue guarantee payments from AEROCIVIL, secure the bonds.
SOLUTIA INC: Wants US$713 Mil. Environmental Claims Reclassified
----------------------------------------------------------------
Solutia Inc. and certain of its affiliates ask the U.S.
Bankruptcy Court for the Southern District of New York to
reclassify certain environmental proofs of claim, conditioned
upon the occurrence of the effective date of the Debtors' Fifth
Amended Joint Plan of Reorganization, dated Oct. 19, 2007.
Under the Plan, the Environmental Claims will be treated
differently from general unsecured claims. According to
Jonathan S. Henes, Esq., at Kirkland & Ellis LLP, in New York,
the Environmental Claims will be dealt with according to these
terms:
(i) Solutia will remain responsible for certain Environmental
Liabilities, as defined in the Plan, with respect to the
sites where the company was an owner or operator on or
after the "spinoff."
(ii) Monsanto Company, as Pharmacia Corporation's attorney-in-
fact, will be responsible for Environmental Liabilities
with respect to sites for which those debts were
transferred to Solutia pursuant to the Spinoff, but where
Solutia was never an owner or operator.
(iii) Solutia and Monsanto will share responsibility for
Environmental Liabilities with respect to the off-site
areas in Anniston, Alabama and Krummrich, Illinois, in
accordance with the allocation set forth in a settlement
agreement between Solutia and Monsanto.
The Plan provides that claims of governmental agencies relating
to environmental liabilities with respect to the Shared Sites
and the Retained Sites "shall be reinstated and unaffected by
the chapter 11 cases and will be liquidated or adjudicated
pursuant to applicable law and in the ordinary course of
business."
Mr. Henes asserts that the future treatment of Environmental
Liabilities, including the Environmental Claims, is an important
component of the Plan and the Global Settlement among Solutia,
Monsanto, Pharmacia, the Official Committee of Unsecured
Creditors, the Official Committee of Equity Security Holders,
and other parties reallocating certain liabilities that Solutia
assumed when it was created.
Since the Petition Date, approximately 389 Environmental Claims
were filed against the Debtors in the aggregate amount of
US$713,296,201, excluding unliquidated portions of the Claims,
Mr. Henes says.
NRD Claims
The Debtors ask Judge Beatty to reclassify five environmental
claims which will not be treated as general unsecured claims to
the extent they satisfy the Plan's definition of "NRD Claims."
The NRD Claims are:
Asserted
Claimant Claim No. Claim Amount Claim Class
-------- --------- ------------ -----------
California Dept. of Fish 5816 US$290 Unsecured
Kansas Dept. of Health & 13551 4,084,000 Unsecured
Environment
United States 11276 Unliquidated
Undetermined
State of Alabama 11277 Unliquidated Priority
State of Illinois 11275 31,965,157
Unclassified
Legacy Site Claims
Solutia has identified around 100 Environmental Claims which,
they believe, relate to Environmental Liabilities with respect
to Legacy Sites.
Pursuant to the Plan, Solutia will receive a discharge from
Legacy Site Claims. Also, under the Solutia-Monsanto Agreement,
Monsanto will hold Solutia harmless with regard to those Claims.
Accordingly, to the extent they satisfy the Plan's definition of
Legacy Site Claims, the Legacy Claims will not be treated as
general unsecured claims and holders of the Legacy Claims will
not receive a distribution from the Debtors' estates on account
of such claims.
As a result, the Debtors ask Judge Beatty to reclassify the
Legacy Claims as Legacy Site Claims, effective upon the Plan
Effective Date.
A complete list of the Legacy Site Claims is available for free
at http://ResearchArchives.com/t/s?24ce
Retained Site Claims
Solutia believes that 13 Environmental Claims relate to
Environmental Liabilities with respect to Retained Sites.
Pursuant to the Plan, to the extent they met the Plan's
definition of Environmental Sites, the Retained Site Claims will
be reinstated and unaffected by the chapter 11 cases.
Accordingly, the Retained Site Claims will not be treated as
general unsecured claims, and holders of Retained Site Claims
will not receive a distribution from the Debtors' estates on
account of those claims. Instead, the Retained Site Claims will
be satisfied by the reorganized Debtors in the ordinary course
of business, Mr. Henes asserts.
Thus, the Debtors seek reclassification the Retained Site Claims
as Environmental Liabilities with respect to Retained Sites,
effective upon the Effective Date.
A complete list of the Retained Site Claims is available for
free at http://ResearchArchives.com/t/s?24cf
Shared Site Claims
The Debtors ask Judge Beatty to reclassify about 30
Environmental Claims Claims as Environmental Liabilities with
respect to Shared Sites.
Pursuant to the Plan, the Shared Site Claims will be reinstated
and unaffected by the Chapter 11 cases. Holders of the Shared
Site claims will not receive distribution from the Debtors'
estates on account of those claims, but instead will be
satisfied in full by either Pharmacia, Monsanto or the
reorganized debtors in the ordinary course of business.
A complete list of the Shared Site Claims is available for free
at http://ResearchArchives.com/t/s?24d0
Reclassification Will Benefit Environmental Claimants
The Debtors state that they are not seeking any determinations
on the merits of the Environmental Claims. According to them,
the reclassification of the Environmental Claims will not
adversely impact the rights of the holders of the Environmental
Claims, but will benefit the claimants from appropriate
classification in "pass-through classes" under the Plan, as
compared to the impaired treatment provided for holders of
general unsecured claims under the Plan.
Accordingly, to clarify the rights, including voting rights, of
parties under the Plan, and to enable the Debtors to maintain an
accurate claims register and ensure that the holders of
Environmental Claims are treated in accordance with the terms of
the Plan, the Environmental Claims need to be reclassified,
contingent upon the occurrence of the Effective Date, Mr. Henes
maintains.
The Debtors reserve the right to:
-- object in the future to any of the Environmental Claims or
portions (a) that are not reclassified pursuant to the
Objection or (b) that are determined not to be an NRD
Claim, a Legacy Site Claim, an Environmental Liability with
respect to Retained Sites or Environmental Liability with
respect to Shared Sites as those terms are defined in the
Plan, based on the merits of the Surviving Claims and any
procedural or substantive grounds; and
-- seek to disallow, reduce or reclassify the Surviving
Claims.
Except as provided for in the Plan, the Debtors reserve any and
all of their rights and defenses with respect to the
Environmental Claims under applicable law.
In addition, notwithstanding the reclassification of any Claim
as an NRD Claim, Legacy Site Claim, Environmental Liability with
respect to Retained Sites or Environmental Liability with
respect to Shared Sites, as between Monsanto and Solutia, the
allocation of liability for any individual claim will be
governed by the applicable provisions of the Agreement, provided
that nothing in will impair or adversely affect any claim, cause
of action, or right of a governmental agency related to
Environmental Liabilities with respect to the Retained Sites or
the Shared Sites.
About Solutia Inc.
Headquartered in St. Louis, Missouri, Solutia Inc. (OTCBB:SOLUQ)
-- http://www.solutia.com/-- and its subsidiaries, engage in
the manufacture and sale of chemical-based materials, which are
used in consumer and industrial applications worldwide. Solutia
has operations in Malaysia, China, Singapore, Belgium, and
Colombia. The company and 15 debtor-affiliates filed for
chapter 11 protection on Dec. 17, 2003 (Bankr. S.D.N.Y. Case No.
03-17949). When the Debtors filed for protection from their
creditors, they listed US$2,854,000,000 in assets and
US$3,223,000,000 in debts.
Solutia is represented by Richard M. Cieri, Esq., Jonathan S.
Henes, Esq., and Michael A. Cohen, Esq., at Kirkland & Ellis
LLP, in New York, as lead bankruptcy counsel, and David A.
Warfield, Esq., and Laura Toledo, Esq., at Blackwell Sanders
LLP, in St. Louis Missouri, as special counsel. Trumbull Group
LLC is the Debtor's claims and noticing agent. Daniel H.
Golden, Esq., Ira S. Dizengoff, Esq., and Russel J. Reid, Esq.,
at Akin Gump Strauss Hauer & Feld LLP represent the Official
Committee of Unsecured Creditors, and Derron S. Slonecker at
Houlihan Lokey Howard & Zukin Capital provides the Creditors'
Committee with financial advice. The Official Committee of
Retirees of Solutia, Inc., et al., is represented by Daniel D.
Doyle, Esq., Nicholas A. Franke, Esq., and David M. Brown, Esq.,
at Spencer Fane Britt & Browne, LLP, in St. Louis, Missouri, and
Frank M. Young, Esq., Thomas E. Reynolds, Esq., R. Scott
Williams, Esq., at Haskell Slaughter Young & Rediker, LLC, in
Birmingham, Alabama.
On Feb. 14, 2006, the Debtors filed their Reorganization Plan &
Disclosure Statement. On May 15, 2007, they filed an Amended
Reorganization Plan and on July 9, 2007, filed a 2nd Amended
Reorganization Plan. The Bankruptcy Court approved the Debtors'
amended Disclosure Statement on Oct. 19, 2007. A hearing to
consider confirmation of the Debtors' Reorganization Plan is
scheduled for Nov. 29, 2007.
(Solutia Bankruptcy News, Issue No. 105; Bankruptcy Creditors'
Service, Inc., http://bankrupt.com/newsstand/or 215/945-7000).
===================
C O S T A R I C A
===================
ANIXTER INT'L: To Repurchase Up to 1 Mil. of Outstanding Shares
---------------------------------------------------------------
Anixter International Inc. has reported a share repurchase
program under which the company may repurchase up to 1 million
of its outstanding shares with the exact volume and timing
dependent on market conditions. Anixter noted that all
previously announced share repurchase programs had been
completed prior to the end of the first quarter of 2007.
Anixter currently has approximately 37.5 million shares
outstanding.
About Anixter
Anixter International Inc. -- http://www.anixter.com/-- is the
world's largest distributor of communication products and
electrical and electronic wire and cable, and a leading
distributor of fasteners and other small parts ("C" class
inventory components) to original equipment manufacturers.
The company has nearly US$725 million in inventory of more than
325,000 products, logistics network of 197 warehouses with more
than 5 million square feet of space. It has operations in Latin
American countries including Mexico, Costa Rica, Brazil and
Chile.
* * *
As reported in the Troubled Company Reporter-Latin America on
Nov. 2, 2007, Fitch Ratings has affirmed these ratings for
Anixter International Inc. and its wholly owned operating
subsidiary, Anixter Inc.:
Anixter International Inc.
-- Issuer Default Rating 'BB+';
-- Senior unsecured debt 'BB-'.
Anixter Inc.
-- Issuer Default Rating 'BB+';
-- Senior unsecured notes 'BB+';
-- Senior unsecured bank credit facility at 'BB+'.
=============
E C U A D O R
=============
PETROECUADOR: New Oil Law May Lead to 3,600 Job Cuts
----------------------------------------------------
Ecuador's new law, which requires private firms to give 99% of
windfall earnings from record-high oil prices to the central
government or to state-run oil company Petroecuador, could lead
to the laying off of about 3,600 workers over the next six
months, Dow Jones Newswires reports, citing oil industry group
Chamber of Oil and Energy Service Providers.
The Chamber of Energy President Federico Perez told Dow Jones
that the group represents 450 firms with about 12,000 workers.
About 80% of the employees are outsourced, while 20% are in
administrative positions.
The immediate consequence of the job losses could be the
reduction of output. It is yet too early to estimate the actual
reductions, Dow Jones says, citing the group.
Mr. Perez commented to Dow Jones, "Oil companies are minimizing
investments because of the large daily losses they're seeing,
which will lower their production and cut hiring for all the
services needed for their operations."
May oil firms indicated that they will revise their plans in
Ecuador once they fail to arrive at an agreement with the
government soon over contract renegotiations, Dow Jones notes,
citing Mr. Perez.
Dow Jones relates that these are among the companies affected by
the increase the state windfall tax:
-- Brazil's Petroleo Brasileiro,
-- Spanish-Argentine Repsol-YPF,
-- French company Perenco,
-- Chinese-led consortium Andes Petroleum, and
-- City Oriente, based in Panama but backed by US
investors.
Mr. Perez told Dow Jones that some of the firms affected by the
government's decision are experiencing a daily loss of up to
US$700,000 per day. Hiring decreased by about 10%, chiefly in
areas of drilling and exploration. This could worsen now that
Petroecuador said it will "file charges against oil firms with
outstanding windfall-tax debt under the 50% regime."
Petroecuador head Carlos Pareja said that the legal actions
could result to the cancellation of contract, Dow Jones notes.
Petroecuador, according to published reports, is faced with
cash-problems. The state-oil firm has no funds for maintenance,
has no funds to repair pumps in diesel, gasoline and natural gas
refineries, and has no capacity to pay suppliers and vendors.
The government refused to give the much-needed cash alleging
inefficiency and non-transparency in Petroecuador's dealings.
=====================
E L S A L V A D O R
=====================
* MIF Fund Says Remittances to Central America Up to US$12.1-Bln
----------------------------------------------------------------
Remittances to Central America will grow by approximately 10% to
about US$12.1 billion in 2007, according to a survey presented
today by the Inter-American Development Bank's Multilateral
Investment Fund.
The survey focused on adults who receive remittances in Costa
Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama.
MIF Manager Donald F. Terry, who presented the results of the
survey at a news conference held during the annual meeting of
the Federation of Latin American Banks (FELABAN), said that
while these flows have continued to rise, too many Central
Americans who send or receive international money transfers
remain excluded from the formal financial system.
"We have to give these families more options to manage their own
money by banking the unbanked. This is critical for economic
development," said Terry, whose fund has been studying
remittances to Latin America and the Caribbean since the year
2000.
Country 2007 Remittances 2006 Remittances
------- ---------------- ----------------
Guatemala US$4.0 million US$3.6 million
El Salvador US$3.5 million US$3.3 million
Honduras US$2.6 million US$2.3 million
Nicaragua US$990,000 US$950,000
Costa Rica US$590,000 US$520,000
Panama US$320,000 US$292,000
--------------- ---------------
Total US$12.1 million US$11.0 million
Remittances will represent at least 10% of four countries' gross
domestic product: Honduras (27%), El Salvador (17%), Nicaragua
(17%) and Guatemala (12%). They will amount to the equivalent
of about half of Nicaragua's exports, approximately 60% of
Guatemala's, about 75% of Honduras and almost all of El
Salvador's exports.
El Salvador leads Central America in remittances per capita,
reaching approximately 1 million adults (averaging US$ 300, 12
times a year). In Honduras, the fastest growing remittance
market in Central America, about 950,000 adults regularly
receive remittances (averaging US$ 225, 12 times a year).
In Guatemala some 1.4 million adults receive remittances
(averaging US$ 240, 12 times a year) while in Nicaragua 500,000
adults receive them (averaging US$ 205, 10 times a year).
Remittances to Costa Rica and Panama are less prevalent, but
still reach important numbers of people: 300,000 adults in Costa
Rica (averaging US$ 250, eight times a year), and about 100,000
adults in Panama (averaging US$ 320, 10 times a year).
For Terry, the real impact of remittances is measured by the
number of families that receive these transfers. In Central
America some four million households receive money on a regular
basis from relatives living and working abroad. Approximately
75% of these remittances are used to cover critical necessities
such as food, housing, clothing, healthcare and utility bills.
Remittances are, in fact, Central America's most important
poverty alleviation program. However, if remittance senders and
receivers were offered more options to manage, save and invest
their money, these transfers could become a much more effective
tool for local economic development.
About US$3 billion of the money sent by Central American
expatriates is not used for immediate consumption but their
potential economic impact is limited by the fact that more than
90% of remittances remain outside the formal financial system.
According to the survey, about 56% of the Central American
households that receive remittances pick up their transfers at a
financial institution. Typically these persons are rarely
offered bank accounts. In contrast, survey respondents showed
significant interest in financial products and services such as
savings accounts (53% said they were "very interested"), life or
health insurance (44%), small business loans (38%), mortgage
loans or home construction loans (31%) or education loans (25%).
The survey also pointed up an emerging trend: significant
numbers of Central Americans are now migrating to Europe and
Canada in search of work. In the past, migrants from this
region went almost exclusively to the United States. It now
appears that measurable numbers of Central Americans are
migrating to Europe, particularly Spain, and to Canada.
"We had already seen this same trend in South America. Now we
are starting to find it in Central America," said Sergio
Bendixen, whose Miami-based polling firm conducted the surveys
for the MIF.
The MIF, an autonomous fund administered by the IDB, finances
projects designed to help reduce the costs of remittances to
Latin America and the Caribbean and promote alternatives to
increase their development impact.
=================
G U A T E M A L A
=================
FLOWSERVE CORP: To Supply Control & Valves for Horizonte Project
----------------------------------------------------------------
Flowserve Corporation has been selected to supply control and
on-off valves for Horizonte Project. The Project is being
managed by Poyry Empreendimentos Industriais S.A., which is
responsible to execute the construction. Once under operation,
the Horizonte Project will be transferred to Votorantim Celulose
e Papel S/A, company of Votorantim Group. Under the agreement,
Poyry plans to purchase up to US$11 million in Flowserve valves
and valve related products for construction of the project being
built in western Brazil, in the State of Mato Grosso do Sul, in
the city of Tres Lagoas.
This construction project is believed to be the largest single-
line pulp plant in the world, with a nominal capacity of 1.3
million tons of dry pulp per year. The new facility will export
part of its production, as well as support the new paper plant
currently under development by International Paper S/A, which is
located at the same location.
"Flowserve will ship approximately 1400 control and on-off
valves over the next 18 months," according to Flow Control
President Thomas L. Pajonas. "We are proud to be selected by
Poyry to participate in a project of this magnitude, and are
committed to being a strategic partner in helping expand their
presence in the Brazilian pulp and paper market."
The order will consist of a number of different types of
Flowserve valves. These will include NAF Duball full port ball
valves; NAF Setball segmented ball valves, NAF Torex triple
offset butterfly valves, Durco Teflon-lined butterfly valves,
Atomac Teflon-lined full port ball valves, and Valtek Mark One
globe control valves.
About VCP
Votorantim - Celulose e Papel S/A -- http://www.vcp.com.br/--
is one of Latin America's largest pulp and paper producers,
exporting 90% of its production to over 55 countries in 5
continents. They currently operate two units in Sao Paulo State
and are fully integrated, from wood production to paper
distribution to the final consumers.
About Flowserve
Headquartered in Irving, Texas, Flowserve Corp. (NYSE: FLS) --
http://www.flowserve.com/-- provides fluid motion and control
products and services. Operating in 56 countries, the company
produces engineered and industrial pumps, seals and valves as
well as a range of related flow management services. In Latin
America, Flowserve operates in 36 countries such as the
Dominican Republic, Guatemala, Guyana and Belize.
* * *
As reported in the Troubled Company Reporter-Latin America on
Aug. 20, 2007, Moody's Investors Service affirmed Flowserve
Corporation's corporate family rating at Ba3 and probability of
default at B1. Moody's also affirmed the Ba2 rating to the
company's senior secured term loan and assigned a Ba2 rating to
Flowserve's senior secured revolving credit facility.
===============
H O N D U R A S
===============
CHOICE HOTELS: Executes Agreement with Winport Developments
-----------------------------------------------------------
Choice Hotels International and Winport Developments, Inc., have
executed a development agreement under which Winport will build
a minimum of 25 MainStay Suites and Suburban Extended Stay
hotels in Canada, all of which are anticipated to open by
Sept. 30, 2010. The companies also announced that they have
simultaneously executed the first five franchise contracts under
this agreement, with hotels under development in Ontario,
Alberta and Atlantic Canada.
Extended stay hotels cater to long-term guests, and these
properties typically enjoy greater operational efficiencies than
traditional hotels due to their unique operating and staffing
models. On account of these operational efficiencies, owners of
extended stay hotels often see stronger margins and returns from
their investments than owners of traditional hotels. Canadian
consumers looking for mid-scale and economy extended stay
lodging options are currently underserved, with very limited
supply available in these segments. Frequently, these travelers
have no option but to stay in transient hotels, which offer
fewer home-style amenities that are desired by long-term guests.
"We are very excited to enter into this agreement with Choice
Hotels International to help develop its MainStay Suites and
Suburban Extended Stay brands throughout Canada," said Ted Good,
president, Winport Developments, Inc. "With support from
Choice's extended stay team in the areas of development, sales
and marketing and operations and field support, we feel very
confident about our prospects for continued growth and success
in this dynamic segment."
MainStay Suites hotels offer a relaxing environment where guests
can enjoy residential-style amenities. Each guest suite
features a fully-equipped kitchen, a sleeper sofa, large work
areas, free high-speed Internet access and free cable
television. Guests also enjoy a complimentary continental
breakfast, and the Canadian hotels will have an on-site fitness
center. Suburban Extended Stay hotels provide the essentials of
home at affordable rates. Each guest room features a well-
equipped kitchen, free cable television, and free high-speed
Internet access. The Suburban hotels in Canada will have on-
site laundry facilities and a fitness center. Both MainStay
Suites and Suburban hotels offer reduced rates for longer stays
and participate in the Choice Privileges rewards program, which
has over 6 million members worldwide.
"We are honored to work with such an esteemed organization as
Winport Developments as we introduce our brands into the
Canadian marketplace," said Kevin Lewis, president, extended
stay brands, Choice Hotels International. "We look forward to a
strong, long-term relationship with Winport as we embark upon
this very exciting alliance that will enable us to establish a
strong market presence in Canada."
About Choice Hotels
Choice Hotels International -- http://www.choicehotels.com/--
franchises more than 5,200 hotels, representing more than
430,000 rooms, in the United States and more than 40 countries
and territories. The company has hotels in Brazil, Costa Rica,
El Salvador, Guatemala and Honduras.
* * *
As reported in the Troubled Company Reporter on Aug. 1, 2007,
Choice Hotels International Inc. reported total assets of US$332
million, total liabilities of US$403.4 million, and total
stockholders' deficit of US$71.4 million as of June 30, 2007.
=============
J A M A I C A
=============
GOODYEAR TIRE: Commences Exchange Offer for 4% Convertible Notes
----------------------------------------------------------------
The Goodyear Tire & Rubber Company has commenced an offer to
exchange any and all of its outstanding 4% Convertible Senior
Notes due June 15, 2034, for a cash premium and shares of its
common stock.
"This exchange offer is another step in our plan to further de-
lever and improve our capital structure," said W. Mark Schmitz,
executive vice president and chief financial officer. "This
allows us to reduce our debt by as much as US$350 million, save
up to US$14 million a year in interest and simplify our balance
sheet."
The exchange offer allows holders of convertible notes to
receive the same number of shares of the company's common stock
as they would receive upon conversion of the convertible notes
in accordance with their current terms, plus a cash premium and
accrued and unpaid interest.
For each US$1,000 principal amount of convertible notes validly
tendered, note holders will receive 83.0703 shares of the
company's common stock, which represents a conversion price of
approximately US$12.04 per share. In addition, per each
US$1,000 principal amount of convertible notes, the company will
offer note holders a cash payment of US$48.30 as well as accrued
and unpaid interest up to, but excluding, the exchange date.
The offer is scheduled to expire at 5:00 p.m., New York City
time, on Dec. 5, 2007. As of Nov. 6, 2007, there was US$349.798
million principal amount of convertible notes outstanding.
Copies of the prospectus may be obtained from the exchange
agent, Wells Fargo Bank, N.A., Corporate Trust Operations, Sixth
and Marquette, MAC N0303- 121, Minneapolis, Minn. 55479,
telephone (800) 344-5128. Goodyear has engaged Goldman, Sachs &
Co., telephone (800) 828-3182, to act as dealer manager in
connection with the exchange offer.
Holders of convertible notes are urged to read the prospectus
and related exchange offer materials when they become available
because they contain important information. The prospectus and
other related documents filed with the Securities and Exchange
Commission may be obtained free of charge from the exchange
agent or at the SEC's website, http://www.sec.gov.
About Goodyear
Headquartered in Akron, Ohio, The Goodyear Tire & Rubber Company
(NYSE: GT) -- http://www.goodyear.com/-- is the world's largest
tire company. The company manufactures tires, engineered rubber
products and chemicals in more than 90 facilities in 28
countries. Goodyear Tire has marketing operations in almost
every country around the world including Chile, Colombia,
Guatemala, Jamaica and Peru in Latin America. Goodyear employs
more than 80,000 people worldwide.
* * *
As reported in the Troubled Company Reporter on June 4, 2007,
Standard & Poor's Ratings Services raised its ratings on
Goodyear Tire & Rubber Co., including its corporate credit
rating to 'BB-' from 'B+'. In addition, the ratings were
removed from CreditWatch where they were placed with positive
implications on May 10, 2007.
MIRANT CORP: Mirant Lovett Posts US$1,130,285 Aug. 2007 Net Loss
----------------------------------------------------------------
Mirant Lovett, LLC
Consolidated Balance Sheet
As of August 31, 2007
ASSETS
Unrestricted Cash US$288
Restricted cash 16,709,929
Total cash 16,710,217
Accounts receivable (net) 9,378,627
Inventory 12,055,198
Notes receivable 31,210,351
Prepaid expenses -
Other 1,364,312
-----------
Total current assets 70,718,705
Property, plant & equipment 10,565,277
Less: accumulated (2,695,995)
Depreciation / depletion
Net property, plant & equipment 7,869,282
Due from insiders
Other assets, net of amortization
Other restricted cash 5,958,062
-----------
TOTAL ASSETS US$84,546,049
LIABILITIES AND EQUITY
Postpetition Liabilities:
Accounts payable 8,877,583
Taxes payable 1,162,546
Notes payable -
Professional fees -
Secured debt -
Other 8,593,537
-----------
Total postpetition liabilities 18,633,666
Prepetition Liabilities:
Secured debt -
Priority debt -
Unsecured debt -
Other liabilities subject to compromise 25,273,500
-----------
Total prepetition liabilities 25,273,500
-----------
TOTAL LIABILITIES 43,907,166
EQUITY
Additional paid in capital 244,343,544
Retained earnings (203,704,661)
Direct charges to equity -
-----------
Total equity 40,638,883
-----------
TOTAL LIABILITIES & OWNERS' EQUITY US$84,546,049
Mirant Lovett, LLC
Consolidated Statements of Income
Month Ending August 31, 2007
REVENUES:
Gross Revenues US$8,901,803
Less: returns & discounts -
-----------
Net revenue 8,901,803
COST OF GOODS SOLD:
Material 4,416,812
Direct labor -
Direct overhead -
-----------
Total cost of goods sold 4,416,812
-----------
Gross margin 4,484,991
OPERATING EXPENSES:
Officer / insider compensation -
Selling & marketing -
General & administrative -
Operating & maintenance 4,962,251
Other -
-----------
Total operating expenses 4,962,251
-----------
Income before non-operating (477,260)
income & expense
OTHER INCOME AND EXPENSES:
Non-operating income -
Non-operating expense -
Interest expense 53,012
Depreciation / depletion 629,668
Amortization -
Other (3,103)
-----------
Net other income & expenses 679,577
REORGANIZATION EXPENSES:
Professional fees -
U.S. Trustee fees -
Other (26,552)
-----------
Total reorganization expenses -
Income tax -
-----------
NET PROFIT (LOSS) US$(1,130,285)
Mirant Lovett, LLC
Unconsolidated Cash Receipts and Disbursements
Month Ending August 31, 2007
Cash, beginning of month US$14,824,607
Cash sales -
Collection of accounts receivable -
Prepetition -
Postpetition -
-----------
Total operating receipts -
Non - operating receipts
Loans & advances (2,254,625)
Sale of assets -
Other 61,750
-----------
Total non-operating receipts (2,192,875)
-----------
Total receipts (2,192,875)
-----------
Total cash available 12,631,732
Operating disbursements
Collateral deposits (11,367,431)
Operating and maintenance 7,289,232
-----------
Total operating disbursements (4,078,199)
Reorganization expenses -
-----------
Total disbursements (4,078,198)
-----------
Net cash flow 1,885,323
-----------
Cash, end of month US$16,709,930
Headquartered in Atlanta, Georgia, Mirant Corporation (NYSE:
MIR) -- http://www.mirant.com/-- is an energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines. Mirant's investments in the Caribbean
include three integrated utilities and assets in Jamaica, Grand
Bahama, Trinidad and Tobago and Curacao. Mirant owns or leases
more than 18,000 megawatts of electric generating capacity
globally.
Mirant Corporation filed for chapter 11 protection on
July 14, 2003 (Bankr. N.D. Tex. 03-46590), and emerged under the
terms of a confirmed Second Amended Plan on Jan. 3, 2006.
thomas E. Lauria, Esq., at White & Case LLP, represented the
Debtors in their successful restructuring. When the Debtors
filed for protection from their creditors, they listed
US$20,574,000,000 in assets and US$11,401,000,000 in debts. The
Debtors emerged from bankruptcy on Jan. 3, 2006. On
March 7, 2007, the Court entered a final decree closing 46
Mirant cases.
Mirant NY-Gen LLC, Mirant Bowline LLC, Mirant Lovett LLC, Mirant
New York Inc., and Hudson Valley Gas Corporation, were not
included. On Feb. 15, 2007, Mirant NY-Gen filed its Chapter 11
Plan of Reorganization and on Feb. 22 filed a Disclosure
Statement explaining that Plan. The Court approved the adequacy
of Mirant NY-Gen's Disclosure Statement on March 22, 2007, and
confirmed the Amended Plan on May 7, 2007. Mirant NY-Gen
emerged from chapter 11 on May 7, 2007.
On July 13, 2007, Mirant Lovett filed its Chapter 11 Plan of
Reorganization. The Court confirmed Mirant Lovett's Plan on
Sept. 19, 2007. (Mirant Bankruptcy News, Issue No. 132;
Bankruptcy Creditors' Service Inc.,
http://bankrupt.com/newsstand/or 215/945-7000)
* * *
To date, Mirant Corp. carries Fitch's B+ long-term issuer
default rating. The rating was assigned on July 11, 2006.
===========
M E X I C O
===========
ADVANCED MARKETING: Wants Until Nov. 30 to Decide on Lone Lease
---------------------------------------------------------------
Advanced Marketing Services Inc., Publishers Group Incorporated,
and Publishers Group West Incorporated ask the U.S. Bankruptcy
Court for the District of Delaware to extend until Nov. 30 the
time by which they may assume or reject their sole remaining
unexpired lease of a non-residential real property, located in
Indianapolis, Indiana, with The Prudential Company of America,
as landlord.
The Court recently extended the Lease Decision Period with
respect to the Indianapolis Lease to Oct. 31, 2007.
Mark D. Collins, Esq., at Richards, Layton & Finger, P.A., in
Wilmington, Delaware, relates that the Debtors have obtained
prior written consent of the lessor of the Indianapolis Lease to
the requested November 30 extension.
Under Section 365(d)(4)(B)(ii) of the Bankruptcy Code, the Court
may grant a subsequent extension "only upon prior written
consent of the lessor in each instance."
The Debtors seek extension of the Indianapolis Lease Decision
Period without prejudice to their right to seek further
extensions.
The Court will convene a hearing on Nov. 27 at 11:00 a.m., to
consider the Debtors' request. Pursuant to Del.Bankr.LR 9006-2,
the Debtors' Lease Decision Period with respect to the
Indianapolis Lease is automatically extended until the
conclusion of that hearing.
About Advanced Marketing
Based in San Diego, Calif., Advanced Marketing Services, Inc.
-- http://www.advmkt.com/-- provides customized merchandising,
wholesaling, distribution and publishing services, currently
primarily to the book industry. The company has operations in
the U.S., Mexico, the United Kingdom and Australia and employs
approximately 1,200 people Worldwide.
The company and its two affiliates, Publishers Group
Incorporated and Publishers Group West Incorporated filed for
chapter 11 protection on Dec. 29, 2006 (Bankr. D. Del. Case Nos.
06-11480 through 06-11482). Suzzanne S. Uhland, Esq., Austin K.
Barron, Esq., Alexandra B. Feldman, Esq., O'Melveny & Myers,
LLP, represent the Debtors as Lead Counsel. Chun I. Jang, Esq.,
Mark D. Collins, Esq., and Paul Noble Heath, Esq., at Richards,
Layton & Finger, P.A., represent the Debtors as Local Counsel.
Lowenstein Sandler PC represents the Official Committee of
Unsecured Creditors. In schedules filed with the Court,
Advanced Marketing disclosed total assets of US$213,384,791 and
total debts of US$216,608,357. Publishers Group West disclosed
total assets of US$39,699,451 and total debts of US$83,272,493.
Publishers Group Inc. disclosed zero assets but US$41,514,348 in
liabilities.
On Aug. 24, 2007, the Debtors' exclusive period to file a
chapter 11 plan expired. On the same date, the Debtors and
Creditors Committee filed a Plan & Disclosure Statement. On
Sept. 26, 2007, the Court approved the adequacy of the
Disclosure Statement explaining the Second Amended Plan. The
hearing to consider confirmation of the Plan is set on
Nov. 15, 2007. (Advanced Marketing Bankruptcy News, Issue No.
22; Bankruptcy Creditors' Service Inc.;
http://bankrupt.com/newsstand/or 215/945-7000)
ATHLETES WORLD: Files for Creditor Protection Under CCAA
--------------------------------------------------------
Athletes World Ltd., Canadian unit of Bata Ltd., filed for
protection from its creditors under the Companies' Creditors
Arrangement Act with the Ontario Superior Court of Justice on
Oct. 30, 2007, Marina Strauss writes for Globe and Mail.
The company, which is losing money to competitors and facing
thousand of dollars in tax claims, said it hopes to sell off its
assets through the bankruptcy process, the report reveals. The
company has been in negotiation with Michael Gold relating to
the sale of the company's assets and had reached an agreement
last May, the report says. However, Mr. Gold backed out on the
deal on Oct. 29, which led to the company's bankruptcy filing
the next day, the report adds.
Athletes World owes about US$152 million, about US$115 million
of which is owed to its parent company, Bata, according to the
report.
About Athletes World
Headquartered in Ontario, Athletes World Ltd. is a shoe retailer
with over 100 stores in Canada. It is the only remaining
Canadian retailer unit of Bata Ltd., -- http://www.bata.com/--
a privately owned global shoe manufacturer and retailer. Bata
is led by a third generation of the Bata family. With
operations in 68 countries, Bata is organized into four business
units. Bata Canada, based in Toronto, serves the Canadian
market with 250 stores. Based in Paris, Bata Europe serves the
European market with 500 stores. With supervision located in
Singapore, Bata International has 3,000 stores to serve markets
in Africa, the Pacific, and Asia, Finally, Bata Latin America,
operating out of Mexico City, sells footwear throughout Latin
America. Bata owns more than 4,700 retail stores and 46
production facilities. Total employment for the company exceeds
50,000.
AXTEL SAB: Moody's Upgrades Corporate Family Rating to Ba2
----------------------------------------------------------
Moody's Investors Service has upgraded Axtel, S.A.B. de C.V.'s
corporate family rating to Ba2 from Ba3 based on the rapid
improvement of the company's credit metrics to levels prior to
the acquisition of Avantel as well as expected improvements in
free cash flow generation. The outlook is now stable.
Approximately US$437.5 million of debt securities affected.
These issues were affected by Moody's action:
-- US$162.5 million of 11% Senior Unsecured Global Notes due
2013
-- US$275 million of 7.625% Senior Unsecured Global Notes due
2017
"During the first nine months of 2007 and after the
incorporation of Avantel, Axtel managed to quickly slash costs
and generate enough EBITDA to bring adjusted debt to EBITDA
ratio to 2.3 times, the same level reached before the
acquisition of Avantel and below the 3.8 times just after the
acquisition, completed in December 2006", said Moody's analyst
Nymia Almeida. Simultaneously, interest coverage as per funds
from operations plus interest expenses to interest expenses
improved to 4.3 times in the last 12 months, from a low of 3.1
times in the first quarter of 2007. These factors, in
conjunction with positive free cash flow generated in the last
quarters, as a result of larger scale and stringent cost
controls, as well as Moody's expectation of growing and
sustainable free cash flow generation, support the ratings
upgrade.
"Constraining Axtel's ratings are escalating challenging
operating environment consequence of strong competition from
incumbent Telmex, increasing wireless substitution and the
strengthening of new-comers to the telecom arena such as cable
TV companies and IP telephony service providers" said Almeida.
This operating risk is somewhat mitigated by the growth
potential for Mexico, evidenced by a low fixed line penetration
rate of approximately 19% as of September 2007, as well as by
Axtel's stronger customer base mix as business customers
represent now 78% of total revenues and thus reduce the threat
on revenues from cable companies' voice offerings. In addition,
Axtel counts on a more balanced product mix as it has a higher
share of data & private lines of total revenues (21%) than
before the incorporation of Avantel (4%). Number portability,
expected for mid 2008, may also offer a good business
opportunity to Axtel.
When updating its ratings on Axtel, Moody's also took into
consideration Axtel's stated leverage tolerance level of 3 times
debt to EBITDA, which is well above current ratio of 2.3 times.
Besides, Moody's analysis also accounted for possible capital
expenditures for acquisition of additional spectrum, with
possible reduction in cash on hands and increase in debt.
The stable outlook is based on Moody's expectations that Axtel
will maintain current operating margins in the foreseeable
future as well as on the company's comfortable debt maturity
profile and liquidity position. Additional ratings upgrade is
not envisioned at this time because of the company's small size
and difficult competitive environment. However, Axtel's ratings
could rise as the company reduces leverage and improved interest
coverage to the point that the strength of its financial profile
overcomes weaker qualitative factors. Underperformance of the
company's business or a major acquisition that lead to an
adjusted debt/EBITDA above 3.0 times with limited prospects for
a rapid reduction in leverage would put negative pressure on
Axtel' ratings.
Headquartered in Monterrey, Mexico, Axtel S.A.B. de C.V. was
formerly known as Axtel SA DE CV. The company's principal
activity is providing local and long-distance domestic and
international telephony, data and Internet services, virtual
private networks and value added services. Services include
different access technologies such as fixed wireless telephony,
point-to-point and point-to-multi point radio links, and copper
and fiber optic connections. Basic services are divided into 5
categories such as voice, conference call, data, Internet and
bundles. It offers basic telecommunications infrastructure in
Mexico through an intelligent network that provides extensive
coverage to all markets. It currently operates in Mexico City,
Monterrey, Guadalajara, Puebla, Leon, Toluca, Queretaro, San
Luis Potosi, Aguascalientes, Saltillo, Ciudad Juarez, Tijuana,
La Laguna, Veracruz and Chihuahua.
BURGER KING: Names Armando Jacomino as President for LatAm Biz
--------------------------------------------------------------
Burger King Corp. has appointed Armando Jacomino as president of
the Latin America region. Mr. Jacomino will continue the
company's restaurant development in Latin America and the
Caribbean, including further expansion into Brazil, Argentina,
Chile and Mexico. He will also oversee the rollout of the
company's global operational platforms throughout the region,
and direct the introduction of new premium products and value
menu strategies. Mr. Jacomino reports to Burger King Corp.'s
Chief Executive Officer John Chidsey and will be an integral
member of the global executive team.
"Strong franchisee relationships are a hallmark of the Latin
America region and Armando is well positioned to maintain these
vital connections," Mr. Chidsey said. "He is a 33 year veteran
of the company with an enduring passion for his people and the
brand. A natural successor to the position, Armando represents
our ability to fill leadership roles internally with the best in
the industry."
Mr. Jacomino began his career at a BURGER KINGr restaurant in
1970 as a crewmember in Miami. He rose quickly through
restaurant management positions in both the U.S. and Latin
America regions. After leaving Burger King Corp. to serve as a
regional operations manager for two large corporations, he
rejoined the company as a franchise business manager in 1998.
Most recently, Mr. Jacomino served as vice president of
operations, training and Mexico development for the Latin
America region. Mr. Jacomino is a graduate of Miami-Dade
College.
Mr. Jacomino replaces Julio Ramirez, who was promoted to
executive vice president, global operations.
Headquartered in Miami, Florida, The Burger King (NYSE: BKC)
-- http://www.burgerking.com/-- operates more than 11,000
restaurants in more than 60 countries and territories worldwide.
Approximately 90% of Burger King restaurants are owned and
operated by independent franchisees, many of them family owned
operations that have been in business for decades. Burger King
Holdings Inc., the parent company, is private and independently
owned by an equity sponsor group comprised of Texas Pacific
Group, Bain Capital and Goldman Sachs Capital Partners.
Burger King Corp. operates restaurants in the Latin American,
Caribbean and Mexican Region. The company's first international
restaurant opened in 1963 in Puerto Rico. Since 1994, Burger
King has opened more than 300 restaurants in the Latin American
region, producing some of the strongest comparable store sales
growth for the brand around the world. Burger King(R)
restaurants in Latin America serve approximately 1,600 customers
per day each, making them some of the highest volume restaurants
in the system.
* * *
As reported in the Troubled Company Reporter-Latin America on
Oct. 16, 2007, Fitch Ratings has upgraded the ratings of Burger
King Corporation as:
-- Long-term Issuer Default Rating to 'BB-' from 'B+';
-- Secured credit facility to 'BB+' from 'BB'.
Simultaneously, Fitch has withdrawn the Recovery Rating:
-- Secured credit facility 'RR2'.
Fitch said the outlook is stable. At June 30, 2007, Burger King
had US$943 million of debt.
CINRAM INTERNATIONAL: Weak Perfomance Cues S&P's Negative Watch
---------------------------------------------------------------
Standard & Poor's Ratings Services has placed its 'BB-' long-
term corporate credit and bank loan ratings on Cinram
International Inc., a wholly owned indirect subsidiary of Cinram
International Income Fund, on CreditWatch with negative
implications. The '4' bank loan recovery rating remains
unchanged.
"The CreditWatch placement follows Cinram's announcement of weak
third-quarter performance," said S&P's credit analyst Lori
Harris. This resulted in a decline in reported EBITDA margin to
14% for the period ended Sept. 30, 2007, from 17% in third-
quarter 2006. The EBITDA drop was due to a number of factors,
including lower DVD prices and a 14% decline in CD sales volume.
Furthermore, lower-than-expected sales of high-definition DVDs
hamper the outlook for the company because of the continuation
of two competing formats. Management expects that high-
definition DVDs will become a meaningful revenue and EBITDA
contributor once a dominant format is established, but this is
not likely to occur in 2008. At the same time, S&P expects
digital distribution to become a larger source of studio
revenues, which will contribute to a decline in DVD sales volume
in the medium term. Because of these challenges, management
announced that it would be suspending monthly distributions
starting in January 2008, which will improve Cinram's liquidity
position and cushion with regard to its financial covenants.
In resolving its CreditWatch listing, S&P will meet with
management and review Cinram's overall financial policies, as
well as its operating and financial strategies.
Cinram International Inc. (TSX: CRW.UN) - http://www.cinram.com/
-- an indirect wholly owned subsidiary Cinram International
Income Fund, provides pre-recorded multimedia products and
related logistics services. With facilities in North America
and Europe, Cinram International Inc. manufactures and
distributes pre-recorded DVDs, VHS video cassettes, audio CDs,
audio cassettes and CD-ROMs for motion picture studios, music
labels, publishers and computer software companies around the
world. The company has sales offices in Mexico.
DANA CORP: Supplies Drivetrain Components to Chrysler LLC
---------------------------------------------------------
Dana Corporation has begun supplying Spicer(R) drivetrain
products -- including front and rear propshafts and front
suspension modules -- to Chrysler LLC for the all-new 2008
Jeep(R) Liberty.
"Dana has been supplying products for Jeep vehicles since they
were first produced and is honored to be selected as an
important supplier for 2008 Jeep Liberty," said Michael J.
Burns, Dana chairman and Chief Executive Officer. "This vehicle
program is another example of how Dana provides innovative
solutions designed to exceed our customers' expectations."
Dana's Spicer(R) Life Series(R) front and rear propshafts reduce
noise, vibration, and harshness levels. The steel front
propshaft features staked-and-centered cardan universal joints
and is manufactured utilizing a pressure-welding process with
shielding gas. The design results in reduced run-out that
allows for less rotational variance.
The friction-welded aluminum rear propshaft features a splined-
tube design, which helps improve crash performance, and includes
staked-and- centered cardan universal joints at both ends.
These welding technologies ensure precise component orientation,
substantially improving initial propshaft balance
characteristics. Staked-and-centered universal joints eliminate
unwanted looseness and provide a smoother, high-speed dynamic
performance.
The front suspension modules feature Dana's Spicer(R) axle
technology and will be assembled at Dana's Toledo, Ohio
facility. The front axle is tested immediately after assembly
to ensure the highest quality noise, vibration, and harshness
levels are achieved.
Dana also supplies Victor Reinz(R) cylinder-head covers for the
3.7-liter engines and Victor Reinz(R) exhaust manifold gaskets
for the 2.4-liter world engines.
Dana has been supplying drivetrain technologies for Jeep
vehicles since the first Willys MA was produced in 1941 and has
provided axles and propshafts for the Jeep Liberty since its
inception in 2002.
About Dana Corporation
Headquartered in Toledo, Ohio, Dana Corporation --
http://www.dana.com/ -- designs and manufactures products for
every major vehicle producer in the world, and supplies
drivetrain, chassis, structural, and engine technologies to
those companies. Dana employs 46,000 people in 28 countries.
Dana is focused on being an essential partner to automotive,
commercial, and off-highway vehicle customers, which
collectively produce more than 60 million vehicles annually.
Dana continues to close plants in North America, moving business
to other countries such as Mexico.
The company and its affiliates filed for chapter 11 protection
on March 3, 2006 (Bankr. S.D.N.Y. Case No. 06-10354). As of
Sept. 30, 2005, the Debtors listed US$7,900,000,000 in total
assets and US$6,800,000,000 in total debts.
Corinne Ball, Esq., and Richard H. Engman, Esq., at Jones Day,
in Manhattan and Heather Lennox, Esq., Jeffrey B. Ellman, Esq.,
Carl E. Black, Esq., and Ryan T. Routh, Esq., at Jones Day in
Cleveland, Ohio, represent the Debtors. Henry S. Miller at
Miller Buckfire & Co., LLC, serves as the Debtors' financial
advisor and investment banker. Ted Stenger from AlixPartners
serves as Dana's Chief Restructuring Officer.
Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel
LLP, represents the Official Committee of Unsecured Creditors.
Fried, Frank, Harris, Shriver & Jacobson, LLP serves as counsel
to the Official Committee of Equity Security Holders. Stahl
Cowen Crowley, LLC serves as counsel to the Official Committee
of Non-Union Retirees.
The Debtors filed their Joint Plan of Reorganization on
Aug. 31, 2007.
FEDERAL-MOGUL: Plan Proponents Incorporate Insurer Settlements
--------------------------------------------------------------
Federal-Mogul Corp. and its debtor-affiliates, together with the
Official Committee of Unsecured Creditors, the Official
Committee of Asbestos Claimants, the Legal Representative for
Future Asbestos Claimants, the Official Committee of Equity
Security Holders, and JPMorgan Chase Bank, N.A., as
administrative agent for Federal-Mogul Corp.'s prepetition
secured credit facility, ask the U.S. Bankruptcy Court for the
District of Delaware to approve certain modifications to the
Fourth Amended Joint Plan of Reorganization.
Among others, the Plan Proponents modified and restated the
Fourth Amended Plan to:
-- reflect agreements that they have reached with the
remaining Plan Objectors, including a coverage-in-place
agreement among Felt Products Manufacturing Co., Federal-
Mogul Corp., and certain signatory insurers;
-- provide that assets of the Asbestos Personal Injury Trust
will include:
* the Reorganized Federal-Mogul Class B Common Stock;
* Asbestos Insurance Action Recoveries attributable to
any Asbestos Personal Injury Claims;
* certain of the Asbestos Insurance Settlement Agreements
attributable to any Asbestos Personal Injury Claims;
and
* insurance coverage addressed in the Asbestos
Coverage-In-Place Agreement.
-- provide that Class IO will consist of all outstanding
shares of Federal-Mogul common stock, of which there were
89,861,480 shares outstanding as of July 25, 2007, and
will also include up to 1,482,716 additional shares; and
-- include Rothschild Inc. among the Released Parties.
In accordance with settlements between the Debtors and various
insurers, the Plan Proponents amended the list of Settling
Asbestos Insurance Companies, a full-text copy of which is
available for free at http://ResearchArchives.com/t/s?2506
CIP Agreement
Pursuant to Section 363 of the Bankruptcy Code and Rule 9019 of
the Federal Rules of Bankruptcy Procedure, the Debtors ask the
Court to approve the Asbestos Bodily Injury Coverage in Place
Agreement among Felt Products Manufacturing Co., Federal-Mogul
Corp., and certain signatory insurers.
A full-text copy of the CIP Agreement is available at no charge
at http://ResearchArchives.com/t/s?2507
The CIP Agreement outlines certain obligations that the Debtors,
the Asbestos Trust, and the CIP Insurers have agreed to
undertake in connection with the confirmation and implementation
of the Fourth Amended Plan, James E. O'Neill, Esq., at Pachulski
Stang Ziehl & Jones LLP, in Wilmington, Delaware, informs the
Court.
Pursuant to the CIP Agreement, the Debtors will:
(1) modify the treatment of Fel-Pro and Vellumoid Claims
under the Plan;
(2) sell to The Travelers Indemnity Company, free and clear
of all liens, claims, and encumbrances, all of their
right, title and interest in the certain post-1986
insurance policies; and
(3) release the CIP Insurers with respect to specifically
described categories of claims.
Moreover, the Asbestos PI Trust will establish and fund
an escrow account at an initial sum of US$3 million, plus
US$4.3 million worth of escrow replenishment funds to be held in
a Trust sub-fund for the purpose of seeking coverage from non-
participating insurers or paying unallocated defense costs and
unallocated indemnity costs relating to Fel-Pro or Vellumoid
Claims; Mr. O'Neill relates that the Debtors and the Trust will
(a) cooperate and assist the CIP Insurers with respect to
the defense of potentially covered claims; and
(b) will assign to the CIP Insurers any rights to collect
payment from any non-party insurers with respect to
Covered Defense Costs or Covered Indemnification Costs
for which the Settling Insurers are liable under the
terms of the Agreement.
The Trust, Mr. O'Neill adds, will use all commercially
reasonable means to pursue insurance coverage from Columbia
Casualty Company, Continental Casualty Company, The Continental
Insurance Company, and their affiliates for all potentially
insured claims under the CNA insurance policies.
The CIP Insurers, on the other hand, agree to withdraw their
objections to the confirmation of the Plan. The CIP Insurers,
however, will not be deemed or required to withdraw their
objections to the Plan A Settlement.
The CIP Insurers also consent to the Plan's contemplated
assignment to the Trust of insurance policy proceeds solely with
respect to Asbestos Claims. In addition, the CIP Insurers agree
to pay Covered Defense Costs related to Fel-Pro Claims,
Vellumoid Claims or Mixed Claims and Covered Indemnification
Costs on a several liability basis. The CIP Insurers further
agree to release the Debtors with regard to specifically
designated claims.
As part of the Settlement, Travelers Indemnity's Claim No. 10163
will be partially allowed as a Class IE secured claim for
US$700,000 to be paid in full in cash in accordance with the
Plan.
The Debtors believe that the terms of the CIP Agreement are fair
and equitable. The CIP Agreement will fully and finally settle
and compromise remaining Plan confirmation objections to the
treatment of Fel-Pro and Vellumoid Claims, Mr. O'Neill points
out.
Other Insurer Settlements
The Debtors also ask the Court to approve separate settlements
that they have reached with Cooper Industries, LLC, and these
insurance companies:
* OneBeacon America Insurance,
* Seaton Insurance Company,
* Stonewall Insurance Company,
* TIG Insurance Company,
* The ACE USA Companies comprised of Century Indemnity
Company, Pacific Employers Insurance Company, Central
National Insurance Company of Omaha, U.S. Fire Insurance
Company, Insurance Company of North America, St. Paul
Mercury Insurance Company, and ACE property and Casualty
Insurance Company, and
* The Travelers Indemnity Company and Travelers Casualty and
Surety Company.
The Insurers' predecessors are alleged to have issued certain
liability insurance policies to Debtor Federal-Mogul Products,
Inc.'s predecessor. The Debtors purchased F-M Products, then
known as Wagner Electric Corp., from Cooper in 1998.
Numerous asbestos claims have been asserted against F-M Products
with respect to certain insurance policies. Both the Debtors
and Cooper assert rights under the Subject Policies. Federal-
Mogul Corp. and F-M Products assert that the Insurers are
obligated under the Subject Policies to make liability payments
and pay defense costs in connection with the Asbestos Claims.
The Insurers dispute the Debtors' and Cooper's assertions as to
coverage under the Subject Policies.
The Debtors and the Insurers have initiated lawsuits against
each other in various jurisdictions in connection with insurance
coverage under the Subject Policies.
Among other things, the Insurer Settlements:
-- settle and resolve the Coverage Dispute among the
Debtors, Cooper, and the Insurers;
-- dismiss, with prejudice, certain of the Coverage Actions;
-- withdraw the Insurers' claims and objections to
confirmation of the Plan, if any;
-- limit the Insurers' future actions against the Debtors;
and
-- preserve certain rights and claims as among the parties.
Under the Settlements, the Insurers agree to pay the Debtors
these amounts:
Insurer Settlement Amount
------- -----------------
ACE USA Companies US$34,000,000
OneBeacon 8,000,000
Seaton 837,500
Stonewall 3,000,000
TIG 8,010,000
Travelers 1,000,000
If the Court approves Plan A, Cooper will be entitled to 12% of
the Settlement Amount. If the Court approves Plan B, Cooper
will be entitled to 20% of the Settlement Amount.
In return for the Settlement Amounts, the Debtors agree to
release the Insurers of all rights to insurance coverage for
released claims under the Subject Policies. The Debtors will
also provide the Insurers with releases relating to Asbestos
Claims under the Pneumo Asbestos Insurance Policies.
Specifically, the Insurer Settlements provide for:
-- a complete release of the Debtors' and the Asbestos
Personal Injury Trust's rights with respect to the
Subject Policies issued prior to 1987;
-- a complete release of the Debtors' rights with respect to
Asbestos Claims under the Pneumo Asbestos Insurance
Policies; and
-- a partial release of the Trust's rights with respect to
Pneumo Asbestos Claims under the Pneumo Asbestos
Insurance Policies.
Cooper will also release the Insurers from all product claims
relating to the pre-1987 Subject Policies, certain Asbestos
Claims, and any violation of the Unfair Claims Practices Acts or
similar statutes under state law or certain negligence, breach
of contract and bad faith causes of action.
Concurrent with the effectiveness of the Debtors' and Cooper's
releases, the Insurers release, covenant not to sue, and forever
discharge the Debtors and Cooper from and against all
obligations and claims in connection with the Subject Policies.
Mr. O'Neill clarifies that the Insurer Settlements do not apply
to:
* the Debtors' rights to coverage relating to non-Asbestos
Claims under the Pneumo Asbestos Policies;
* Cooper's rights to coverage relating to non-products or
non-completed operations limits of the Subject Policies;
and
* MagneTek National Electric Coil, Inc.,'s rights to
coverage relating to non-products or non-completed
operations limits of the Subject Policies for claims other
than Asbestos Claims.
The Insurer Settlements do not negatively impact the rights of
Asbestos claimholders or non-party insurance companies, Mr.
O'Neill maintains. The net proceeds of the Settlement Amount
arising from the the Debtors' insurance rights, he points out,
will be paid to the Trust for the benefit of the Asbestos
claimholders. Any qualifying insurer will receive adequate
protection for loss of its contribution rights resulting from
the Settlements, Mr. O'Neill assures the Court.
TIG confirms that upon Court approval of its Settlement with the
Debtors and Cooper, it will withdraw, without further act or
deed, its objections to the Plan and any pending motions that it
has filed in the Debtors' Chapter 11 cases.
Cooper clarifies that it has not yet agreed to the Travelers
Settlement as proposed at this time. Cooper reserves all its
rights to raise objections to the Settlement should ongoing
negotiations not conclude successfully.
Modified TDPs
In addition, the Plan Proponents modified the form of Asbestos
Personal Injury Trust Agreement and Asbestos Personal Injury
Trust Distribution Procedures, a full-text copy of which is
available for free at http://ResearchArchives.com/t/s?2508
In accordance with a Court-approved stipulation with Owens-
Illinois, Inc., the Plan Proponents modified the Asbestos PI
TDPs to provide, among other things, that nothing in the Plan
limits or impairs a claimant's obligation under applicable law
to respond fully to lawful discovery in an underlying civil
action regarding the claimant's submission of factual
information to the Trust for the purpose of obtaining
compensation for asbestos-related injuries from the Trust.
In exchange for the TDP modifications, Owens-Illinois has agreed
to withdraw its objections to the Plan with prejudice.
Objections to Insurer Settlements
About six entities oppose the Insurer Settlements among the
Debtors, Cooper, ACE USA Companies, OneBeacon, Seaton,
Stonewall, TIG, and Travelers:
* CNA,
* Fireman's Fund Insurance Company and National Surety
Company,
* PepsiAmericas, Inc.; and
* the Hartford Companies comprised of First State Insurance
Company, Hartford Accident and Indemnity Company, and New
England Insurance Company.
The proposed orders approving the Insurer Settlements include
language that purports to affect our rights of contribution and
subrogation against the Settling Insurers, the Objecting
Entities complain.
"[A]ll non-settling insurers' contribution claims that would
have been allowable and/or recoverable against the settling
insurer but for any applicable injunctions [should] be credited,
dollar-for-dollar, against any claim for coverage by the Debtors
and/or the Trust against the non-settling insurer," Michael W.
Yurkewicz, Esq., at Klehr, Harrison, Harvey, Branzburg & Ellers
LLP, in Wilmington, Delaware, argues on Hartford's behalf.
Mr. Yurkewicz contends that the Proposed Approval Orders include
new potentially misleading surplusage regarding their effect on
the rights and obligations of non-settling insurers. "This new
language is unnecessary, does nothing to clarify the
Settlements, and potentially creates confusion," he asserts.
CNA also objects to the CIP Agreement between the Debtors and
the CIP Insurers arguing that the CIP Agreement "thrusts upon
[it] new burdens that did not exist under the current claims
handling protocols and were not warranted under the applicable
policies and law." The CIP Agreement does not adequately
preserve its rights, CNA contends.
In addition, Certain Underwriters at Lloyd's, London, and
Certain London Market Companies, complain that they were not
given adequate notice of the Insurer Settlements; thus, they are
unable to determine if, and to what extent, their rights are
affected by the Settlements.
The Objecting Entities thus ask the Court to disapprove the
Insurer Settlements unless the Proposed Approval Orders are
clarified to state that they will not eliminate, affect, or
impair any of their rights or obligations, including potential
rights of contribution and subrogation against the Settling
Insurers.
The Underwriter ask the Court to convene the hearing to consider
approval of the Insurer Settlements on November 14 to give them
adequate time to review the Settlements.
About Federal-Mogul
Based in Southfield, Michigan, Federal-Mogul Corporation --
http://www.federal-mogul.com/-- is an automotive parts company
with worldwide revenue of some $6 billion. Federal-Mogul also
has operations in Mexico and the Asia Pacific Region, which
includes, Malaysia, Australia, China, India, Japan, Korea, and
Thailand.
The Company filed for chapter 11 protection on Oct. 1, 2001
(Bankr. Del. Case No. 01-10582). Lawrence J. Nyhan Esq., James
F. Conlan Esq., and Kevin T. Lantry Esq., at Sidley Austin Brown
& Wood, and Laura Davis Jones Esq., at Pachulski, Stang, Ziehl,
Young, Jones & Weintraub, P.C., represent the Debtors in their
restructuring efforts. When the Debtors filed for protection
from their creditors, they listed US$10.15 billion in assets and
US$8.86 billion in liabilities. Federal-Mogul Corp.'s U.K.
affiliate, Turner & Newall, is based at Dudley Hill, Bradford.
Peter D. Wolfson, Esq., at Sonnenschein Nath & Rosenthal; and
Charlene D. Davis, Esq., Ashley B. Stitzer, Esq., and Eric M.
Sutty, Esq., at The Bayard Firm represent the Official Committee
of Unsecured Creditors.
On March 7, 2003, the Debtors filed their Joint Chapter 11 Plan.
They submitted a Disclosure Statement explaining that plan on
April 21, 2003. They submitted several amendments and on
June 6, 2004, the Bankruptcy Court approved the Third Amended
Disclosure Statement for their Third Amended Plan. On
July 28, 2004, the District Court approved the Disclosure
Statement. The estimation hearing began on June 14, 2005. The
Debtors submitted a Fourth Amended Plan and Disclosure Statement
on Nov. 21, 2006, and the Bankruptcy Court approved that
Disclosure Statement on Feb. 6, 2007. The confirmation hearing
started on June 18, 2007.
(Federal-Mogul Bankruptcy News, Issue No. 151; Bankruptcy
Creditors' Service Inc., http://bankrupt.com/newsstand/or
215/945-7000)
GREENBRIER COS: Declares US$.08 Per Share Quarterly Dividend
------------------------------------------------------------
The Greenbrier Companies has announced a quarterly cash dividend
of US$.08 per share, payable on Dec. 12, 2007, to stockholders
of record as of Nov. 21, 2007.
Headquartered in Lake Oswego, Oregon, The Greenbrier Cos. (NYSE:
GBX) -- http://www.gbrx.com/-- supplies transportation
equipment and services to the railroad industry. The company
builds new railroad freight cars in its manufacturing facilities
in the US, Canada, and Mexico and marine barges at its U.S.
facility. It also repairs and refurbishes freight cars and
provides wheels and railcar parts at 30 locations (post Meridian
acquisition) across North America. Greenbrier builds new
railroad freight cars and refurbishes freight cars for the
European market through both its operations in Poland and
various subcontractor facilities throughout Europe. Greenbrier
owns approximately 9,000 railcars, and performs management
services for approximately 136,000 railcars.
* * *
As reported in the Troubled Company Reporter-Latin America on
March 30, 2007, Moody's Investors Service downgraded the ratings
of The Greenbrier Cos., Inc. -- corporate family to B1, senior
unsecured to B2 (LGD5, 72%) and the speculative grade liquidity
rating to SGL-3. Moody's said the outlook is now stable. These
rating actions conclude the review for downgrade prompted by
Greenbrier's acquisition of Meridian Rail Holdings Corp in late
2006.
Downgrades:
Issuer: Greenbrier Companies, Inc. (The)
-- Probability of Default Rating, Downgraded to B1 from Ba3
-- Speculative Grade Liquidity Rating, Downgraded to SGL-3
from SGL-2
-- Corporate Family Rating, Downgraded to B1 from Ba3
-- Senior Unsecured Convertible/Exchangeable Bond/Debenture,
Downgraded to B2 72 - LGD5 from B1 64 - LGD4
-- Senior Unsecured Regular Bond/Debenture, Downgraded to a
range of B2 72 - LGD5 from B1 64 - LGD4
Outlook Actions:
Issuer: Greenbrier Companies, Inc. (The)
-- Outlook, Changed To Stable From Rating Under Review
GREENBRIER COS: Earns US$13.2 Million in Fourth Quarter 2007
------------------------------------------------------------
The Greenbrier Companies has reported results for its fiscal
fourth quarter and fiscal year ended Aug. 31, 2007.
Financial Highlights
Fourth Quarter:
-- Revenues for the quarter were up US$85 million or 32% to
US$351 million vs. the prior year's fourth quarter, driven by
acquisition-related growth in refurbishment & parts.
-- Net earnings for the quarter were US$13.2 million, or US$.82
per diluted share vs. US$12.3 million, or US$.76 per share,
in the prior year's fourth quarter. These results include a
special charge of US$2.3 million, or US$.14 per diluted
share, with no related tax benefit, associated with closure
costs of the company's Canadian railcar manufacturing
facility.
-- Earnings before special charges for the quarter were US$15.5
million, or US$.96 per diluted share.
-- EBITDA before special charges for the quarter was US$43.0
million, or 12.3% of revenues.
Fiscal 2007:
-- Revenues for the year were up 28%, to a record US$1.224
billion, driven by acquisition-related growth in
refurbishment & parts.
-- Net earnings for the year were US$22.0 million, or US$1.37
per diluted share. These results include special charges net
of a related tax benefit, of US$13.7 million, or US$.85 per
diluted share, associated with closure costs and investment
write-off for tax purposes of the company's Canadian railcar
manufacturing facility.
-- Earnings before special charges, net of a related tax
benefit, for the year were US$35.7 million, or US$2.22 per
diluted share.
-- EBITDA before special charges for fiscal 2007 was US$130
million, up 16% over 2006 EBITDA of US$112 million.
Fourth Quarter Results
Revenues for the 2007 fiscal fourth quarter were US$350.6
million, up from US$265.2 million in the prior year's fourth
quarter. Gross margin for the quarter was 17.3% compared to
15.0% in the prior comparable period. EBITDA before special
charges was US$43.0 million, or 12.3% of revenues for the
quarter, compared to US$25.8 million, or 9.7% of revenues in the
prior year's fourth quarter. Net earnings were US$13.2 million,
or US$.82 per diluted share for the quarter, compared to net
earnings of US$12.3 million, or US$.76 per diluted share for the
same period in 2006. Current period net earnings include a
special charge of US$2.3 million, or US$.14 per diluted share,
with no related tax benefit. This special charge is associated
with severance and other closure costs of the company's Canadian
railcar manufacturing facility. This facility's last order was
completed in early May 2007, and the disposition of the facility
is in process.
Greenbrier's new railcar manufacturing backlog as of
Aug. 31, 2007 was 12,100 units valued at US$830 million,
compared to 14,100 units valued at US$970 million as of May 31,
2007. Approximately 6,000 of the units included backlog as of
Aug. 31, 2007 are expected to be produced in 2008.
Approximately 3,900 units included in the Aug. 31, 2007 backlog
that will be produced after 2008 are subject to Greenbrier's
fulfillment of certain competitive conditions.
Subsequent to Aug. 31, 2007, a multi-year order was received for
11,900 units to be delivered over an eight-year period
commencing in the first quarter of 2009. Approximately 8,500
units under this contract are subject to the company's
fulfillment of certain competitive conditions.
In the manufacturing segment, fourth quarter revenues were
US$209.1 million, compared to US$213.8 million in the fourth
quarter of 2006. While current quarter new railcar deliveries
of 2,400 units were down from the 3,200 units in the prior
comparable period, revenues declined by only US$4.7 million.
The revenue per unit increased significantly due to a change in
product mix. Marine manufacturing revenues also increased by
nearly US$10 million over the prior comparable period. For the
full year, marine revenues were nearly US$55 million, compared
to about US$40 million in 2006.
Manufacturing margin for the quarter grew to 12.9% of revenues,
compared to 10.7% of revenues into the fourth quarter of 2006.
The operating momentum realized in the third quarter of 2007,
where margins were 8.4%, continued in the current quarter.
Margins benefited from efficiencies of long production runs and
a favorable product mix. Also, beginning in the fourth quarter
of 2007, the company's Canadian operations, which are now shut
down, no longer adversely impact manufacturing margins.
The refurbishment & parts segment includes results for 35 shop
locations across North America, which repair and refurbish
railcars, provide wheel, axle and bearing services, and
recondition and provide replacement railcar parts. Revenues for
this segment in the current quarter were US$116.9 million,
compared to US$28.0 million in the fourth quarter of 2006. This
segment generated one-third of total company revenues for the
fourth quarter, on a revenue increase of US$88.9 million over
the same period of last year. About US$80 million of this
growth was from the acquisitions of Rail Car America (four
repair shops and one parts location) and Meridian Rail Services
(six wheel shops, one repair shop and one parts location) as
well as the start-up of two new repair shops during the year.
The remainder of the growth was principally due to higher
volumes of refurbishment and retrofitting work.
Gross margin for the refurbishment & parts segment grew to 17.7%
of revenues, as compared to 15.1% of revenues in the prior
comparable period. The margin growth is the result of increased
railcar program maintenance volumes, favorable scrap prices, and
a more favorable product mix.
The leasing & services segment includes results from the
company's owned lease fleet of approximately 9,000 railcars and
from fleet management services provided for approximately
136,000 railcars. Revenues for this segment were US$24.6
million, compared to US$23.4 million in the same quarter last
year. The revenue increase was principally due to a US$2.3
million increase in gains on disposition of assets from the
lease fleet, partially offset by a decrease in interest income
from lower cash balances. Leasing & services margin for the
quarter was 53.4% of revenues, compared to 54.2% of revenues in
the same quarter last year.
Selling and administrative expense for the quarter includes
US$2.3 million of overhead costs associated with the Canadian
operation, which was permanently closed in May 2007.
William A. Furman, president and chief executive officer, said,
"Fiscal 2007 was an exciting year for Greenbrier. We realized a
number of strategic accomplishments, including: 1) growth of our
refurbishment & parts business through the acquisitions of Rail
Car America and Meridian Rail Services; 2) expansion of our
marine operations through capital expenditures; 3) enhancement
of our manufacturing footprint by exiting our Canadian facility
and expanding in Mexico; and 4) receipt of an 11,900 unit multi-
year order for new tank and covered hopper cars, two car types
where future demand is anticipated to be strong. These
initiatives improve our competitive positioning, enhance our
integrated business model, and diversify our revenue and
earnings base into higher margin, less cyclical businesses."
Future Outlook
Mr. Furman added, "We continue to be optimistic about the long
term fundamentals of the railroad industry and our enhanced
competitive position. In the near term, demand in the North
American new railcar market, including demand for double stack
intermodal railcars, is moderating as a result of softer rail
loadings and supply/demand imbalances. As such, industry
forecasts have been revised downward to 50,000 -- 55,000 units
to be built in 2008, compared to 65,000 units in 2007. We had
anticipated these trends and have made changes to our new
railcar production plans and rates. In addition, we are taking
appropriate actions to reduce our costs. Our current outlook is
for Greenbrier's new railcar deliveries in fiscal 2008 to be
down moderately from fiscal 2007 levels, with a product mix that
is less favorable than 2007. Our past strategic decisions to
grow our more stable marine manufacturing, refurbishment &
parts, and leasing & services businesses were also made in
anticipation of this operating environment, and we believe this
business diversification should serve us well during this
period, as well as in the future. Our strategic goals remain
unchanged, and we continue to seek opportunities to grow these
business units, both organically and through potential
acquisitions."
Mark Rittenbaum, senior vice president and treasurer, said, "All
three of our business segments performed well during the fourth
quarter, particularly manufacturing, where operating momentum
continued and our financial expectations for the quarter were
exceeded. As we enter a challenging fiscal 2008, we will have
the benefit of a new railcar backlog which includes
approximately 6,000 railcars to be produced in 2008, a fully
booked marine barge backlog, a full year of results from our
Meridian and RCA acquisitions, and a lease fleet which is
performing well. Our current lease fleet utilization is 98.1%,
with an average remaining lease term of 3.1 years. These
factors will help mitigate a downturn in the marketplace in
2008."
About Greenbrier
Headquartered in Lake Oswego, Oregon, The Greenbrier Cos. (NYSE:
GBX) -- http://www.gbrx.com/-- supplies transportation
equipment and services to the railroad industry. The company
builds new railroad freight cars in its manufacturing facilities
in the US, Canada, and Mexico and marine barges at its U.S.
facility. It also repairs and refurbishes freight cars and
provides wheels and railcar parts at 30 locations (post Meridian
acquisition) across North America. Greenbrier builds new
railroad freight cars and refurbishes freight cars for the
European market through both its operations in Poland and
various subcontractor facilities throughout Europe. Greenbrier
owns approximately 9,000 railcars, and performs management
services for approximately 136,000 railcars.
* * *
As reported in the Troubled Company Reporter-Latin America on
March 30, 2007, Moody's Investors Service downgraded the ratings
of The Greenbrier Cos., Inc. -- corporate family to B1, senior
unsecured to B2 (LGD5, 72%) and the speculative grade liquidity
rating to SGL-3. Moody's said the outlook is now stable. These
rating actions conclude the review for downgrade prompted by
Greenbrier's acquisition of Meridian Rail Holdings Corp in late
2006.
GRUPO GIGANTE: Acquires PriceSmart's 50% Stake in PSMT Mexico
--------------------------------------------------------------
PriceSmart, Inc. (NASDAQ: PSMT) sold Oct. 31, 2007, its 50%
interest in PSMT Mexico, S.A. de C.V. to Grupo Gigante, S.A.B.
de C.V., for US$2,000,000 in cash.
PSMT Mexico, a joint venture between PriceSmart and Grupo
Gigante formed in January 2002 to operate PriceSmart warehouse
clubs in Mexico, ceased all club operations in February 2005.
The company will record a non-cash write-off of US$2.6 Million
related to the remaining amounts of this investment on the
balance sheet in its fourth quarter, fiscal year 2007 results,
which will include a US$892,000 impairment of the company's
investment and US$1.7 Million in accumulated unrealized losses
associated with currency changes. While the company believed
that the value of the investment as previously indicated on the
balance sheet would over time be realized, a substantial portion
of the realizable assets of PSMT Mexico related to applications
for refunds from the Mexican tax authorities for pre-paid taxes.
In light of uncertainty regarding the timing and amount of these
refunds, the company concluded that it was in the Company's best
interest to complete the divestment of its Mexico holdings
pursuant to this transaction and reduce its involvement in
activities not related to the future growth of the membership
warehouse business in its targeted markets.
Based on the most recent information available to it, the
company believes Grupo Gigante owns approximately 5.8% of the
Company's outstanding shares of common stock.
About PriceSmart
Headquartered in San Diego, Calif., PriceSmart owns and operates
U.S.-style membership shopping warehouse clubs in Central
America and the Caribbean, selling high quality merchandise at
low prices to PriceSmart members. PriceSmart now operates 23
warehouse clubs in 11 countries and one U.S. territory (four
each in Panama and Costa Rica; two each in Dominican Republic,
El Salvador, Guatemala, Honduras, and Trinidad; and one each in
Aruba, Barbados, Jamaica, Nicaragua and the United States Virgin
Islands).
About Grupo Gigante
With over 600 units in Mexico, Grupo Gigante, S.A. de C.V., is a
public Mexican trade company, which operates in the Mexican
Stock Market -- Bolsa Mexicana de Valores. Through its
subsidiaries, Gigante has developed leading chains of
supermarkets, family restaurants, and specialized commerce, for
43 years. Its saubsidiaries include "Gigante", which contains
formats including: "Gigante" (Hypermarkets), "Super Gigante"
(Supermarkets), "Super Maz" and "Bodega" (Warehouses), all of
them supermarket chains, as well as "Cafeterias Toks, S.A. de
C.V.," a specialized family restaurant chain. With its
partners, Grupo Gigante has also established joint ventures,
developing Office Depot de Mexico, S.A. de C.V., a Mexican
leader chain store of office and school supplies, and Radio
Shack de Mexico, S.A. de C.V., an exclusive format with presence
throughout the Mexican Republic, that offers a wide assortment
of electronic equipment and accessories.
* * *
As reported on July 13, 2007, Fitch Ratings affirmed the 'BB'
foreign and local currency Issuer Default Ratings of Grupo
Gigante S.A.B. de C.V., as well as the 'BB' rating of Gigante's
US$260 million Senior Notes due 2016. Fitch said the rating
outlook is stable.
GRUPO GIGANTE: Mulls Sale of Some Assets
----------------------------------------
Mexican supermarket and office-supply retailer Grupo Gigante
S.A.B. de C.V. is studying the possibility of shedding some
assets, published reports say. In this regard, financial
advisers were hired to consider strategic options in what may
turn-out to be a billion-dollar transaction.
The Financial Times says Grupo Gigante will be selling its
grocery stores but not the real estates. The supermarket
division is comprised of the chains Gigante, Bodega Gigante,
Super Gigante, and SuperPrecio. The company's Toks restaurant
chain is already in an auction process, a source familiar with
the matter told the FT.
A report from El Universal also talked about the sale of
Gigante's grocery stores.
Rumored sale of the company's assets have been circulating for
many years. But in this latest talk, the company was compelled
to disclose the sale plans in a statement to the Mexican Stock
Exchange after news reports said it will be selling grocery
stores. The statement did not say whether the sale will be
limited to the grocery stores.
Bloomberg News suggests likely buyers of Grupo Gigante's assets
to include Chilean supermarket operators or retailers. Other
possible bidders to the group's 285 supermarkets may include
Wal-Mart de Mexico SAB, Organizacion Soriana SAB, Grupo
Chedraui, and Controladora Comercial Mexicana.
"They have structured the deal in order to custom fit it to the
likeliest bidders," the FT source added.
The FT, citing another unnamed source, states that the sale of
Gigante's assets has caught the interest of "financial and
strategic" players. Whoever will succeed in acquiring the
supermarkets will have a bigger access to the Mexico City area.
"The whole world will be interested," Joaquin Ley, a retail
analyst at Santander Investment, told Bloomberg in a telephone
interview from Mexico City.
The group's market value is estimated at more than US$1.8
billion, based on the MXN29.9 per share trading on Nov. 6.
Aside from its supermarkets, Grupo Gigante also operates 151
outlets of the Office Depot JV business, with locations in
Mexico, Guatemala, Costa Rica, and El Salvador. The FT believes
that the business will also be divested in a parallel
transaction.
The sale is being considered not because the company "need to"
but because it "wants too," the FT says, citing its source.
With over 600 units in Mexico, Grupo Gigante, S.A. de C.V., is a
public Mexican trade company, which operates in the Mexican
Stock Market -- Bolsa Mexicana de Valores. Through its
subsidiaries, Gigante has developed leading chains of
supermarkets, family restaurants, and specialized commerce, for
43 years. Its saubsidiaries include "Gigante", which contains
formats including: "Gigante" (Hypermarkets), "Super Gigante"
(Supermarkets), "Super Maz" and "Bodega" (Warehouses), all of
them supermarket chains, as well as "Cafeterias Toks, S.A. de
C.V.," a specialized family restaurant chain. With its
partners, Grupo Gigante has also established joint ventures,
developing Office Depot de Mexico, S.A. de C.V., a Mexican
leader chain store of office and school supplies, and Radio
Shack de Mexico, S.A. de C.V., an exclusive format with presence
throughout the Mexican Republic, that offers a wide assortment
of electronic equipment and accessories.
* * *
As reported on July 13, 2007, Fitch Ratings affirmed the 'BB'
foreign and local currency Issuer Default Ratings of Grupo
Gigante S.A.B. de C.V., as well as the 'BB' rating of Gigante's
US$260 million Senior Notes due 2016. Fitch said the rating
outlook is stable.
HIPOTECARIA SU: Extends Cash Tender Offer for 8.50% Senior Notes
----------------------------------------------------------------
Hipotecaria Su Casita, S.A. de C.V., Sociedad Financiera de
Objeto Limitado, a variable capital corporation (sociedad
anonima de capital variable) operating as a special purpose
finance company (Sociedad Financiera de Objeto Limitado)
organized under the laws of the United Mexican States,
has announced offer to purchase for cash (Tender Offer) any and
all of its outstanding 8.50% Senior Notes due 2016, upon the
terms and subject to the conditions set forth in the Offer to
Purchase and Consent Solicitation Statement dated Oct. 10, 2007
and in the related Consent and Letter of Transmittal, has been
extended.
The Tender Offer will now expire at 12:00 midnight, New York
City time, on Nov. 12, 2007, unless extended or earlier
terminated. Registered holders of the Notes who validly tender,
and do not validly withdraw, their Notes after 5:00 p.m., New
York City time, on Oct. 23, 2007 and prior to 12:00 midnight,
New York City time, on Nov. 12, 2007 will receive only the Offer
Price, and will not be eligible to receive the Total
Consideration. The total consideration offered for Notes
validly tendered and not validly withdrawn pursuant to the
Tender Offer shall be 105.5% of the principal amount of such
Notes. The Total Consideration includes a consent payment of
3.0% of the principal amount of such Notes. The Total
Consideration minus the Consent Payment is referred to as the
"Offer Price." In addition to the Total Consideration or Offer
Price, as applicable, Holders whose Notes are purchased will
also receive accrued and unpaid interest from the last interest
payment date preceding the Offer to, but not including, the
Settlement Date. The "Settlement Date" is expected to be on the
first business day after Nov. 12, 2007 or promptly thereafter.
Pursuant to the Tender Offer, as of 5:00 p.m. on Nov. 5, 2007,
US$111.798 million or 74.53%, in aggregate principal amount of
the company's outstanding Notes had been tendered and not
withdrawn. In addition, as of Oct. 23, 2007, the company had
obtained consents to the Proposals from holders of Notes
representing 74.48% in principal amount of the outstanding
Notes.
In connection with the Tender Offer, the company intends to
issue senior unsecured floating rate notes due 2012 in the form
of Certificados Bursatiles under applicable Mexican law, to be
registered and listed exclusively in Mexico through the Mexican
Stock Exchange (New Notes). The company is currently in the
process of registering the New Notes before the National
Securities Registry of the Mexican Securities and Banking
Commission, and expects this registration to occur before
Nov. 12, 2007. The company intends to use the proceeds from the
offering of the New Notes (New Notes Offering) to consummate the
Tender Offer. If the New Notes Offering is not consummated, or
if the New Notes Offering does not result in the receipt by the
company of proceeds at least equal to the Total Consideration or
the Offer Price, as applicable, with respect to all Notes
validly tendered and not validly withdrawn prior to
Nov. 12, 2007, from the issuance of the New Notes on terms and
conditions satisfactory to the company (Financing Condition),
the company will not be required to accept for payment, purchase
or pay for any tendered Notes, subject to Rule 14e-1(c) under
the U.S. Securities Exchange Act of 1934, as amended, and the
company may extend or terminate the Offer.
The obligation of the company to accept for payment and to pay
for any Notes validly tendered pursuant to the Tender Offer is
conditioned upon (1) the execution by the company and The Bank
of New York, as trustee under the indenture dated as of
Sept. 29, 2006, under which the Notes were issued, of a
supplemental indenture implementing the proposed amendments to
the Indenture pursuant to the terms of the Indenture, (2) there
having been validly tendered and not validly withdrawn prior to
12:00 midnight, New York City time, on Nov. 12, 2007, not less
than a majority in aggregate principal amount of the Notes
outstanding under the Indenture, excluding Notes owned by the
company or any of its affiliates, (3) the Financing Condition,
and (4) satisfaction of the other conditions to the Tender Offer
set forth in the Offer to Purchase.
The company has retained Merrill Lynch, Pierce, Fenner & Smith
Incorporated to act as Dealer Manager for the Tender Offer and
Consent Solicitation, and Global Bondholder Services Corporation
to act as the depositary and information agent for the Tender
Offer and Consent Solicitation.
Any questions or requests for assistance regarding the Offer may
be made to the Dealer Manager and Solicitation Agent, Merrill
Lynch & Co., Attention: Liability Management Group at (888) 654-
8637 or (212) 449-4914. Questions or requests for assistance or
additional copies of the Offer to Purchase and the related
Letter of Transmittal may be directed to the Information Agent,
Global Bondholder Services Corporation, toll free at (866) 794-
2200 (bankers and brokers call collect at (212) 430-3774).
About HSC
Hipotecaria Su Casita, S.A. de C.V. is Mexico's second largest
specialized mortgage lending institution by market share. Its
main function is to extend mortgage loans to low-income
individuals under the auspices of Sociedad Hipotecaria Federal
financing programs, and to provide construction financing to
developers of low-income housing. It controls approximately 18%
of the mortgage market served by Sofoles, based on total loan
portfolio. It has 107 offices in Mexico. Hipotecaria Su Casita
was established in 1994.
* * *
As reported in the Troubled Company Reporter-Latin America on
June 21, 2007, Standard & Poor's Ratings Services raised its
long-term counterparty credit rating on Hipotecaria Su Casita
S.A. de C.V. (HSC) to 'BB' from 'BB-'. S&P said the outlook is
stable. At the same time, S&P raised the rating on HSC's senior
unsecured notes to 'BB'.
MOVIE GALLERY: Bankruptcy Cues Moody's to Withdraw Ratings
----------------------------------------------------------
Moody's Investors Service has withdrawn Movie Gallery Inc.'s
ratings. The ratings have been withdrawn because the issuer
entered bankruptcy on Oct. 16, 2007.
These ratings are withdrawn:
-- Corporate family rating of C;
-- Probability of default rating of D;
-- US$100 million senior secured revolving credit facility of
Caa1 (LGD2, 18%);
-- US$25 million synthetic letter of credit facility of Ca
(LGD4, 55%);
-- US$600 million first lien term loan of Ca (LGD4, 55%);
-- US$175 million second lien term loan to C (LGD5, 81%);
-- Senior unsecured notes of C (LGD6, 96%);
-- Speculative grade liquidity of SGL-4.
Based in Dothan, Alabama, Movie Gallery Inc. --
http://www.moviegallery.com/-- is a home entertainment
specialty retailer. It operates over 4,600 stores in the United
States, Canada, and Mexico under the Movie Gallery, Hollywood
Entertainment, Game Crazy, and VHQ banners.
The company and its debtor-affiliates filed for Chapter 11
protection on Oct. 16, 2007 (Bankr. E.D. Va. Case Nos. 07-33849
to 07-33853. Anup Sathy, Esq., Marc J. Carmel, Esq., and
Richard M. Cieri, Esq., at Kirkland & Ellis LLP, represent the
Debtors. Michael A. Condyles, Esq., and Peter J. Barrett, Esq.,
at Kutak Rock LLP, serve as the Debtors' local counsel. The
Debtors' claims & balloting agent is Kutzman Carson Consultants
LLC. The U.S. Trustee for Region 4 appointed an Official
Committee of Unsecured Creditors in the Debtors' bankruptcy
proceedings on Oct. 18, 2007.
When the Debtors' filed for protection from their creditors,
they listed total assets of US$891,993,000 and total liabilities
of US$1,419,215,000. (Movie Gallery Bankruptcy News, Issue
No. 3; Bankruptcy Creditors' Service Inc.;
http://bankrupt.com/newsstand/or 215/945-7000).
QUAKER FABRIC: Court Okays J.H. Albert as Insurance Consultants
---------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware permitted
Quaker Fabric Corp. and Quaker Fabric Corporation of Fall River
to employ J.H. Albert International Insurance Advisors Inc. as
their insurance consultants.
J.H. Albert is expected to provide an assessment of the Debtors'
open claim reserves related to the Debtors' self-insured
workers' compensation insurance program, and to develop and
implement a strategy to close that program. The Debtors believe
that the firm's efforts will result in a superior disposition of
its compensation program.
Judith A. Kokinda, the vice-president of J.H. Albert, said that
the firm will be paid a retainer of US$15,000 and will be paid a
management counseling fee in accordance with its hourly rates,
which range from US$135 to US$325 per hour. In addition, J.H.
Albert will arrange for the completion of an actuarial report of
the Debtors' workers compensation exposure for a flat fee of
US$10,000. The Debtors will be entitled to credit the retainer
toward the management consulting fee and actuarial report fee.
The total estimated fee for J.H. Albert is US$30,600, as
indicated in the parties' services agreement.
Ms. Kokinda assures the Court that the firm is "disinterested"
as that term is defined in Section 101(14) of the U.S.
Bankruptcy Code.
About Quaker Fabric
Based in Fall River, Mass., Quaker Fabric Corp. (NASDAQ: QFAB)
-- http://www.quakerfabric.com/-- designs, manufactures, and
markets woven upholstery fabrics primarily for residential
furniture manufacturers and jobbers. It also develops and
manufactures specialty yarns, including chenille, taslan, and
spun products for use in the production of its fabrics, as well
as for sale to distributors of craft yarns, and manufacturers of
homefurnishings and other products. The company is one of the
largest producers of Jacquard upholstery fabrics.
Quaker Fabric sells its products through sales representatives
andindependent commissioned sales agents in the United States,
Canada, Mexico, and internationally.
The company and its affiliate, Quaker Fabric Corporation of Fall
River, filed for chapter 11 protection on Aug. 16, 2007 (Bankr.
D. Del. Case No. 07-11146). John D. Sigel, Esq. at Wilmer
Cutler Pickering Hale and Dorr LLP and Joel A. Waite, Esq. at
Young Conaway Stargatt & Taylor LLP are co-counsels to the
Debtors. Epiq Bankruptcy Solutions is the Debtors' claims
agent. The Official Committee of Unsecured Creditors has
selected Shumaker, Loop & Kendrick, LLP, as its bankruptcy
counsel and Benesch, Friedlander, Coplan & Aronoff, LLP, as co-
counsel.
The Debtors' schedules reflect total assets of US$41,375,191 and
total liabilities of US$54,435,354.
URS CORP: Amends Pact with WGI to Raise Merger Consideration
------------------------------------------------------------
URS Corporation and Washington Group International Inc.'s
definitive merger agreement for the acquisition of Washington
Group by URS has been amended to increase the consideration to
be received by Washington Group stockholders and to provide them
with the ability to elect to receive cash, stock or cash and
stock for their shares (subject to proration).
Based on the closing price of URS' common stock on Nov. 2, 2007,
the consideration is now valued at approximately US$3.2 billion,
or US$97.89 per Washington Group share, which represents a
premium of approximately 8.5% over the initial merger
consideration value of US$90.20 as of such date. Based on the
volume weighted average price of URS' common stock during the
five trading days ending on Nov. 2, 2007, the consideration is
now valued at approximately US$3.2 billion, or approximately
US$99.00 per Washington Group share, compared with a value of
approximately US$3.0 billion, or US$91.14 per Washington Group
share (using the five trading day weighted average), under the
terms of the original merger agreement.
Under the terms of the revised merger agreement, which has been
unanimously approved by the boards of directors of both
companies, Washington Group stockholders can elect to receive
all cash, all stock, or a combination of cash and stock (subject
to proration) with a consideration value of 0.900 shares of URS
common stock plus US$43.80 in cash for each Washington Group
share. The proration will be determined based on the volume-
weighted average price of URS' common stock during the five
trading days ending on the day before the required Washington
Group stockholder approval is received. This five trading day
period is currently scheduled to end on Nov. 14, 2007. The
election procedures are subject to proration to preserve an
aggregate per share mix of 0.900 shares of URS common stock plus
US$43.80 in cash for all outstanding Washington Group shares and
options (after giving effect to the options' exercise prices).
Based on the outstanding shares and options of Washington Group
as of Sept. 30, 2007, in the aggregate, Washington Group shares
and options will be converted into approximately US$1.4 billion
in cash and approximately 29 million shares of URS common stock.
All terms of the original merger agreement not related to the
revised merger consideration remain substantially unchanged.
Upon completion of the transaction, Washington Group
stockholders would own approximately 35% of the combined
company, compared with approximately 32% under the terms of the
original merger agreement. Stockholders of record of URS common
stock and Washington Group common stock at the close of business
on Sept. 21, 2007, will be entitled to vote at the special
meetings.
Dennis Washington Exercises Stock Options
Washington Group also disclosed that Dennis Washington, Chairman
of the Washington Group board of directors, has executed a
binding agreement to exercise all of his beneficially owned
stock options for 3.224 million shares of Washington Group stock
(or approximately 10% of outstanding Washington Group stock) and
vote his shares in favor of the revised merger agreement if
necessary to achieve the required Washington Group stockholder
approval. If it is necessary for Mr. Washington to exercise his
options and vote his shares, a new record date and meeting date
for the Washington Group special meeting will be set. Mr.
Washington has indicated that he intends to make the necessary
Hart-Scott-Rodino Act filing today in order to be able to
exercise his options, and has also indicated that if the merger
is completed he would elect to receive cash for all of his
Washington Group shares (subject to proration).
"The enhancement to the terms of our agreement reflects URS'
commitment to the combination with Washington Group and our
conviction that the transaction will create significant benefits
for the stockholders, customers and employees of both
companies," Martin M. Koffel, Chairman and Chief Executive
Officer of URS, said. "We believe that the recent strong
performance of both companies and continued positive outlook for
our businesses warrant the increase in our offer. However, URS
is a disciplined buyer and these terms represent our best and
final offer for Washington Group."
"We are very pleased to present this increased consideration to
our stockholders for their vote at our special meeting next
week," Washington Group President and Chief Executive Officer
Stephen G. Hanks, said. "The increased financial terms of our
agreement with URS provide even greater value to Washington
Group stockholders, as well as a higher level of continued
ownership in the combined entity and greater flexibility to
choose between cash and stock in exchange for their shares. The
combination of Washington Group and URS represents a unique
opportunity to create a single-source provider that can offer a
full life cycle of planning, engineering, construction,
environmental management, and operations and maintenance
services. Our board of directors unanimously recommends that
Washington Group stockholders vote in favor of the merger
agreement."
URS expects the transaction to be slightly dilutive to GAAP
earnings per share in 2008, accretive to GAAP EPS in 2009 and
beyond, and accretive to its cash EPS in 2008 and beyond, not
including revenue synergies expected through the combination.
Consummation of the transaction is subject to the approval of
the revised definitive merger agreement by Washington Group
stockholders holding a majority of the outstanding shares and
the approval of the issuance by URS of shares of common stock in
the transaction by URS stockholders holding a majority of the
shares voting.
Stockholders' Special Meeting
URS and Washington Group have rescheduled the companies' special
meetings of stockholders for Nov. 15, 2007 to provide investors
with additional time to evaluate the revised offer.
Supplemental proxy materials will be distributed to URS and
Washington Group stockholders prior to the new meeting date.
The special meeting of URS stockholders will be held at 9:00
a.m., local time, at the offices of Cooley Godward Kronish LLP,
located at 1114 Avenue of the Americas, New York, New York. The
special meeting of Washington Group stockholders will be held at
7:00 a.m., local time, at Washington Group's offices located at
720 Park Boulevard, Boise, Idaho.
URS Outlook for Fiscal 2007
URS has revised its outlook for fiscal 2007 based on revenue
growth for the nine months of 2007 and the company's continued
positive outlook for its markets. URS now expects that 2007
revenues will be approximately US$4.85 billion compared to its
prior estimate of US$4.8 billion. Assuming this revenue
expectation is met, URS now expects that 2007 net income will be
approximately US$134 million compared to its prior estimate of
US$132 million.
URS noted that the guidance provided above does not include the
impact of the proposed acquisition of Washington Group.
About Washington Group
Headquartered in Boise, Idaho, Washington Group International
Inc. -- http://www.wgint.com/-- provides the talent,
innovation, and proven performance to deliver integrated
engineering, construction, and management solutions for
businesses and governments worldwide. The company has
approximately 25,000 people at work around the world providing
solutions in power, environmental management, defense, oil and
gas processing, mining, industrial facilities, transportation
and water resources.
About URS Corp.
Headquartered in San Francisco, California, URS Corporation
(NYSE:URS)-- http://www.urscorp.com/-- is an engineering design
services firm and a United States federal government contractor
for systems engineering and technical assistance and operations
and maintenance services. The company's business focuses
primarily on providing fee-based professional and technical
services in the engineering and construction services and
defense markets, although the company performs some limited
construction work. It operates through two divisions: the URS
Division and the EG&G Division. The company also has offices in
Argentina, Australia, Belgium, China, France, Germany, and
Mexico, among others.
* * *
As reported in the Troubled Company Reporter-Latin America on
Sept. 21, 2007, Standard & Poor's Ratings Services assigned its
'BB+' bank loan rating and '2' recovery rating to URS Corp.'s
proposed US$2.1 billion senior secured credit facilities,
indicating expectations of substantial recovery in the event of
a payment default. The facilities are rated the same as the
corporate credit rating on the company.
As reported in the Troubled Company Reporter on Sept. 20, 2007,
Moody's Investors Service assigned a provisional rating of
(P)Ba1 to the proposed US$2.1 million senior secured credit
facility of URS Corporation, which will be used to finance its
pending acquisition of Washington Group International Inc.
X-RITE INC: Incurs US$2.8-Mln Net Loss in Quarter Ended Sept. 29
----------------------------------------------------------------
X-Rite Incorporated has posted a net loss of US$2.8 million for
the third quarter ended Sept. 29, 2007, compared to a net loss
of US$28.2 million for the same quarter of 2006.
Net sales from continuing operations totaled US$55.6 million, an
8.6 percent increase over third quarter of 2006.
Adjusted operating income, which excludes acquisition and
restructuring expenses, was US$4.9 million, and reflects a gross
margin of 55.6 percent for the third quarter of 2007 versus
US$3.6 million and a gross margin of 60.4 percent for the same
period in 2006.
"Overall sales in our core markets are in line with
expectations, and the integration of the sales, engineering and
general & administrative functions is on track," stated Thomas
J. Vacchiano, Jr., Chief Executive Officer of X-Rite. "Our
revenue performance in the third quarter was consistent with our
targets as we continue to successfully integrate our product
lines, develop exciting new products and expand our customer
base."
"Our gross margins were below expectations by approximately 5.0
percent in the third quarter," stated Mary E. Chowning, Chief
Financial Officer. "Approximately 2.6 percent of the gross
margin decline in the third quarter was related to issues we
encountered as we converted our core operating system and
conformed operating practices in Europe. This conversion will
allow us to standardize operating policies and practices in the
operations area and move product production from Europe to the
US more efficiently. Additionally, weak performance in our
color services business and unfavorable product mix impacted our
gross margins by approximately 2.8 percent. However, these
items are not expected to impact gross margins significantly in
the longer term."
Outlook
During fiscal year 2007, the company expects to realize cost
synergies related to the Amazys integration of US$14 million to
US$16 million. This includes the US$13.3 million of synergies
achieved in the first nine months of 2007. Anticipated
cumulative synergies since the closing of the transaction are
expected to range from US$20 million to US$22 million by the end
of 2007.
"Backlog and order levels at the end of the third quarter remain
strong and we continue to believe that we are well positioned to
capitalize on future growth opportunities," stated Vacchiano.
"We are particularly enthusiastic about the Pantone acquisition
and our ability to leverage their brand, market position and
products to drive our top line going forward. We remain
committed to our fiscal 2007 guidance of 4 to 6 percent revenue
growth on a combined pro forma basis and expect our full year
results, excluding Pantone, to be at or slightly above the high
end of the range."
Pantone Transaction
On Aug. 23, 2007, the company announced that it had entered into
a definitive agreement to purchase Pantone, Inc. for US$180
million in cash. The transaction and refinancing of the
Company's current debt was financed through new borrowings. The
Pantone acquisition was completed on Oct. 24, 2007 and thus did
not affect third quarter performance.
About X-Rite
Headquartered in Grandville, Michigan, X-Rite Incorporated
(Nasdaq: XRIT) -- http://www.xrite.com/-- offers color
measurement technology solutions comprised of hardware, software
and services for the verification and communication of color
data. The company serves a broad range of industries, including
graphic arts, digital imaging, industrial and retail color
matching, and medical, among other industries. X-Rite is
global, with 21 offices throughout Europe, Asia, and the
Americas, serving customers in 100 countries.
The X-Rite Latin America sales team provides assistance to
customers in Mexico, Central and South America, and the
Caribbean. X-Rite's sales team works together with highly
qualified local vendors and distributors to ensure the best
possible personalized customer assistance, offering a wide and
unparalleled array of products, support and repair services.
* * *
As reported in the Troubled Company Reporter-Latin America on
Oct. 3, 2007, Moody's Investors Service has confirmed X-Rite,
Inc.'s B1 corporate family rating, affirmed the speculative
grade liquidity rating of SGL-1 and revised the outlook to
negative in view of the additional leverage and integration risk
associated with the company's recently announced acquisition of
Pantone, Inc.
=====================
P U E R T O R I C O
=====================
MARCOS GARCIA: Case Summary & 11 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Marcos Dionisio Santiago-Garcia
Monserrate Maldonado-Torres
P.O. Box 1950
Guayama, PR 00785
Bankruptcy Case No.: 07-06421-11
Chapter 11 Petition Date: October 31, 2007
Court: District of Puerto Rico (Old San Juan)
Debtor's Counsel: Jacqueline Hernandez Santiago, Esq.
Jacqueline Hernandez Santiago
P.O. Box 366431
San Juan, PR 00936-6431
Tel: (787) 751-1836
Estimated Assets: US$100,000 to US$1 Million
Estimated Debts: US$1 Million to US$100 Million
Debtor's list of their 11 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Banco Popular Bank loan US$253,288
G.P.O. Box 71735
San Juan, PR 00936
Banco Santander Puerto Rico Bank loan US$89,003
P.O. 70117
San Juan, PR 00936-8117
Mr. Milton Arizmendi Pacheco Bank loan US$73,000
URB. Colinas de Yauco F-13,
Calle Prado
Yauco, PR 00698-4147
18 Brother USA, Inc. Trade debt US$58,507
CIT Group Commercial Serv. Trade debt US$35,608
Banco Bilbao Vizcaya Bank loan US$41,970
Rams Import Trade debt US$21,568
JC Manufacturing Inc. Trade debt US$16,667
Five Star Accessories Trade debt US$15,832
Bank of America Bank loan US$14,409
GMAC Commercial Finance LLC Trade debt US$14,339
UNIVISION COMMS: Incurs US$26.8-Mln Net Loss in Third Quarter
-------------------------------------------------------------
Univision Communications Inc. posted a US$26.8 million of net
loss for the third quarter ended Sept. 30, 2007, compared to
US$88.2 million of net income for the same quarter in 2006.
For the third quarter, net revenue increased 9.8%1 to US$529.1
million from US$481.9 million in the third quarter of 2006,
excluding 2006 FIFA World Cup estimated incremental net revenues
of US$24.7 million. Including World Cup incremental revenue in
2006, net revenue increased 4.4% and adjusted operating income
before depreciation and amortization increased 7.8% to US$220.5
million in 2007 from US$204.5 million in 2006. Prior to the
completion of the merger on March 29, 2007, the Company decided
to sell the Company's music recording and publishing businesses.
As a result, the music division results of operations, assets
and liabilities are reported as a discontinued operation for all
periods presented and are not included in the above results.
Joe Uva, Chief Executive Officer, said, "I am extremely pleased
that Univision has continued the positive momentum of last
quarter, producing third quarter operational and financial
results that demonstrate strengthened fundamentals and, combined
with last quarter's gains, solidify our platform for future
growth across all of our core businesses. During the quarter,
the Univision Network ranked as the #3 broadcast network in the
country in primetime for the entire quarter, with a young adult
audience larger than CBS, ABC and CW. Univision Radio has
sustained very strong revenue growth, while Univision.com
continued to grow in strides, underscoring its position as the
#1 Internet destination among Hispanics."
Mr. Uva continued, "Importantly, Univision's commitment to
inform and educate our Hispanic audience about the issues that
matter most to them remains an integral part of our mission.
This quarter, Univision debuted "Al Punto," a Sunday morning
talk program devoted to getting to the heart of the news events
and issues that are most relevant to Hispanic viewers.
Univision also made history by presenting the first ever
Presidential Candidate Forum designed specifically for Hispanic-
Americans, which created a direct line of communication between
the candidates and the Hispanic electorate. The Democratic
forum out delivered every previous English-language debate among
Adults 18-49, highlighting the increasing importance and power
of the Hispanic community in the U.S. and the pivotal role it
will play in shaping our country's future."
Andrew W. Hobson, Senior Executive Vice President and Chief
Financial Officer, said, "Univision's third quarter net revenue
growth of 9.8%, excluding World Cup incremental revenue,
demonstrates the momentum we are seeing in our businesses. I am
pleased our OIBDA growth continues to accelerate and that each
core division of our business continues to outperform their
respective industries."
Headquartered in Los Angeles, Calif., Univision Communications
Inc., (NYSE: UVN) -- http://www.univision.net/-- owns and
operates more than 60 television stations in the U.S. and Puerto
Rico offering a variety of news, sports, and entertainment
programming. The company had about USUS$2.6 billion in debt at
Dec. 31, 2006.
* * *
As reported in the Troubled Company Reporter-Latin America on
May 16, 2007, Fitch Ratings downgrades these ratings:
-- USUS$7.7 billion senior secured bank loans due 2014
'B+/RR3';
-- 3.50% senior secured notes due 2007 to 'B+/RR3' from 'BB';
-- 3.875% senior secured notes due 2008 to 'B+/RR3' from
'BB';
-- 7.85% senior secured notes due 2011 to 'B+/RR3' from 'BB';
-- USUS$500 million second lien term loan due 2009 'B-/RR5';
-- USUS$1.5 billion 9.75%/10.50% senior unsecured notes due
2015 'CCC+/RR6'.
=================
V E N E Z U E L A
=================
ARVINMERITOR INC: Unit Awarded Supply Business by Hyundai Motor
---------------------------------------------------------------
ArvinMeritor's Body Systems business unit within the Light
Vehicle Systems business group has been awarded new business to
supply over four million window regulator motors annually to
Hyundai Motor Company worldwide. The agreement will supply
Hyundai's future models with ArvinMeritor's New Generation Motor
II from January 2010 through January 2017.
"This new business award is indicative of Hyundai's confidence
in ArvinMeritor's body systems technology. Our competitive
advantage is rooted in our global footprint that enables us to
produce high-quality products in locations that are convenient
to our customers all over the world," said Aziz Aghili, vice
president and general manager of Body Systems for LVS,
ArvinMeritor.
The New Generation Motor II offers several benefits, including
an improved electromagnetic compliance design, a more robust
brush card, and minimization of lower body vibration due to the
improved rigidity of the gear housing - all at a reduced cost.
The New Generation Motor II will be produced in ArvinMeritor
facilities located in China, India, France, and the United
States for delivery to Hyundai manufacturing facilities located
in Korea, Europe, China, India, and the United States.
About Light Vehicle Systems
ArvinMeritor's LVS business group is a market leader in the
product categories it serves, supplying integrated systems and
modules to the world's leading passenger car and light truck
OEMs. Through smart systems(TM) technologies, the intelligent
application of controls and electronics, ArvinMeritor's
traditional mechanical products are taking on new form and
function at both the component and system levels. With advanced
technology and systems design expertise in body systems, chassis
and wheels, LVS combines high-quality components into cost-
effective, performance-based solutions for virtually every car
and light truck on the road.
About ArvinMeritor
Headquartered in Troy, Michigan, ArvinMeritor, Inc. (NYSE: ARM)
-- http://www.arvinmeritor.com/-- supplies integrated systems,
modules and components to the motor vehicle industry. The
company serves light vehicle, commercial truck, trailer and
specialty original equipment manufacturers and certain
aftermarkets. ArvinMeritor employs about 29,000 people at more
than 120 manufacturing facilities in 25 countries. These
countries are: China, India, Japan, Singapore, Thailand,
Australia, Venezuela, Brazil, Argentina, Belgium, Czech
Republic, France, Germany, Hungary, Italy, Netherlands, Spain,
Sweden, Switzerland, United Kingdom, among others.
* * *
As reported in the Troubled Company Reporter on Oct. 9, 2007,
Fitch Ratings downgraded its ratings on ArvinMeritor Inc.
including Issuer Default Rating to 'BB-' from 'BB'; Senior
secured revolver to 'BB' from 'BB+'; and Senior unsecured notes
to 'B+' from 'BB-'. Fitch said the rating outlook is negative.
Standard & Poor's Ratings Services lowered its corporate credit
rating and related ratings on ArvinMeritor Inc. to 'B+' from
'BB-'. S&P said the outlook is negative.
Moody's Investors Service downgraded ArvinMeritor's Corporate
Family Rating to B1 from Ba3 and maintained the outlook at
stable. Moody's also lowered its ratings on the company's
secured bank obligations (to Ba1, LGD-1, 8% from Baa3, LGD-2,
13%) and unsecured notes (to B2, LGD-4, 63% from B1, LGD-4,
63%). The Probability of Default is changed to B1 from Ba3,
while the company's Speculative Grade Liquidity rating remains
SGL-2. Moody's said the outlook is stable.
HERBALIFE LTD: Reports US$48-Mln Net Income in 2007 Third Qtr.
--------------------------------------------------------------
Herbalife Ltd. reported third quarter net sales of US$529.5
million, an increase of 11.1 percent compared to the same period
of 2006. This record performance was largely attributable to
double-digit growth in several of the company's top countries,
including the U.S. up 20.4 percent, Taiwan up 23.6 percent and
China up 89.3 percent, versus the third quarter of 2006. The
company's Chairman and Chief Executive Officer Michael O.
Johnson, said, "We are pleased to report our 15th consecutive
quarter of double-digit growth and another record quarter for
net income. Our strong performance reflects the strength of our
independent distributor organization, their confidence in the
company, and the foundation we've built with our products,
business opportunity, brand and image."
The company earned US$48 million for the three months ended
Sept. 30, 2007, compared to net income of US$26.4 million for
the same period in 2006.
Excluding the impact of refinancing charges and other items1 in
third quarter of 2006, adjusted diluted net income per share was
US$0.51, resulting in a US$0.16 improvement in third quarter
2007. The increase in net income was primarily attributable to
double-digit net sales growth, expansion in operating profit
margins, and a reduction in interest expense during the period.
During the third quarter 2007, total supervisors increased 16.6
percent to 418,735 and new supervisors of 52,982 increased 4.7
percent versus the third quarter of 2006. The company's
President's Team membership increased 11.3 percent to 1,066
members.
Financial Performance
During the third quarter, the company invested US$9.2 million in
capital expenditures, primarily related to enhancements to its
management information systems and additional infrastructure
investments to improve distributor service levels.
On Aug. 23, 2007, the company's Board of Directors approved an
increase of US$150 million to its previously authorized share
repurchase program of US$300 million raising the total value of
company common shares authorized to be repurchased to US$450
million. During the third quarter, the company repurchased 1.7
million shares of its common stock through open market
transactions at an average price of US$39.23 for an aggregate
cost of US$65.1 million. The company used excess cash along
with debt to fund the repurchase. Since this share repurchase
program was authorized in April 2007, the company has
repurchased 5.2 million shares at an aggregate cost of US$203.9
million.
For year to date Sept. 30, 2007, the company reported net sales
of US$1,567.7 million an increase of 12.1 percent compared to
US$1,398.2 million in the comparable period in 2006. For the
year to date Sept. 30, 2007, the company reported net income of
US$137.6 million, compared to US$101.5 million in the comparable
period for 2006. Excluding the impact of favorable tax
settlements in international markets in 2006 and 2007,
recapitalization expenses and tax benefits on refinancing
transactions in 2006, as well as 2007 expenses related to the
company's realignment for growth initiative1, year to date
Sept. 30, 2007 net income increased 29.4 percent to US$141.6
million, compared to US$1.47 per diluted share in the comparable
period in 2006.
Third Quarter 2007 Business Highlights
The company experienced record-breaking attendance at its
distributor extravaganza events around the world. Over 10,000
distributors attended the North America regional event in
Dallas, Texas. Over 17,000 distributors attended the EMEA
regional event in Cologne, Germany. Over 15,000 distributors
attended the South East Asia and North Asia regions combined
Asia Pacific Extravaganza in Singapore. Over 17,000
distributors attended our Mexico and Central America regional
event in Mexico City. These events are important to allow
distributors a venue to train and network, and for the company
to introduce new products and recognize distributor success.
The company continued its support of distributor business
methods by sharing best practices globally. "We continue to
encourage sharing of distributor best practices as we focus our
company resources on supporting the distributors' daily methods
of operations," said Greg Probert, the company's president and
chief operating officer.
Fourth Quarter 2007 Guidance
Based on its current business trends, the company is raising its
full year 2007 diluted earnings per share guidance to be in a
range of US$2.62 to US$2.64. The company is providing guidance
for the fourth quarter of 2007 in the range of US$0.72 to
US$0.74 for diluted earnings per share. Additionally, fourth
quarter investment in capital expenditures are expected in the
range of US$16 million to US$18 million.
Full Year 2008 Guidance
Based upon current business trends coupled with the anticipated
impact from investment initiatives, the company anticipates
revenue growth to be in the range of 7 percent to 10 percent and
earnings per share guidance to be in a range of US$3.17 to
US$3.23. Additionally, the company anticipates that its capital
spending will be in the range of US$85 million to US$95 million
as the company implements Oracle ERP worldwide during 2008.
About Herbalife Ltd.
Herbalife Ltd. (NYSE: HLF) -- http://www.herbalife.com/--
Herbalife, now in its 26th year, conducts business in 62
countries. The company does business with several manufacturers
worldwide and has its own manufacturing facility in Suzhou,
China as well as major distribution centers in Venray,
Netherlands, Japan, Los Angeles, Calif., Memphis, Tenn.,
Guadalajara, Mexico, and El Salvador. The company also has
operations in Venezuela.
* * *
As reported in the Troubled Company Reporter on April 5, 2007,
Standard & Poor's Ratings Services said that its 'BB+' corporate
credit rating on Los Angeles-based Herbalife Ltd. remains on
CreditWatch with negative implications following the company's
announcement that the company's board of directors has rejected
a bid to be acquired by Whitney V L.P. The board indicated that
although it views Whitney's bid as too low, it would consider an
improved offer.
* Beard Group Announces New Audio Conference for November 15
------------------------------------------------------------
The Beard Group, Law and Business Publishers, and the Troubled
Company Reporter will hold a new audio conference on
Nov. 15, 2007.
Entitled "The Battle of Green & Red: Effect of Bankruptcy on
Obligations to Clean Up Contaminated Property", this audio
conference -- a live 90-minute telephone conference with
interactive Q&A session -- will be presented by Joel Gross, a
partner at Arnold & Porter and member of both the firm's
bankruptcy and environmental practice groups.
This interactive audio conference will include written materials
and the opportunity to ask your most pressing questions. You'll
cover:
* 5 key principles for understanding interactions between
environmental and bankruptcy laws.
* Why bankruptcy is no excuse for violating environmental
standards.
* Brief primer on CERCLA (Superfund) requirements for
clean-up of contaminated property.
* How liability can be triggered just by deciding to stop
operating.
* Who pays for clean-up when the polluter is insolvent?
* Is property abandonment a viable option?
* How are environmental liens addressed in bankruptcy?
* Impact of the recent Atlantic Research Corp. Supreme
Court decision.
* Unresolved issues still confronting legal
decision-makers.
* Strategies for today's debtors facing environmental
liabilities.
About Joel Gross
Joel Gross is a partner in the Washington, D.C., office of
Arnold & Porter, and a member of both the firm's environmental
practice group as well as its bankruptcy group. Before joining
Arnold & Porter in 2000, he was the Chief of the Environmental
Enforcement Section at the Department of Justice. Joel advises
clients on compliance strategies that can minimize the risk of
enforcement actions, and has represented a wide range of clients
in connection with ongoing civil and or criminal enforcement
actions under the Clean Air Act, the Clean Water Act, and the
Resource Conservation and Recovery Act. He also represents
clients dealing with -- and seeking innovative approaches to
resolve -- remediation and natural resource damages liabilities
arising from contaminated sites. He has a special interest in
the interaction of the environmental laws and the bankruptcy
laws and has represented both debtors and creditors in
connection with environmental disputes in bankruptcy proceedings
around the country.
Register by Nov. 8 and save US$50 off the regular tuition.
Tuition is US$245 prior to Nov. 8; US$295 afterwards.
***********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter - Latin America is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Fairless
Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick,
Maryland USA. Marjorie C. Sabijon, Sheryl Joy P. Olano, Rizande
de los Santos, and Pamella Ritah K. Jala, Editors.
Copyright 2007. All rights reserved. ISSN 1529-2746.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without
prior written permission of the publishers.
Information contained herein is obtained from sources believed
to be reliable, but is not guaranteed.
The TCR Latin America subscription rate is US$625 per half-year,
delivered via e-mail. Additional e-mail subscriptions for
members of the same firm for the term of the initial
subscription or balance thereof are US$25 each. For
subscription information, contact Christopher Beard at
240/629-3300.
* * * End of Transmission * * *