/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/090128.mbx T R O U B L E D C O M P A N Y R E P O R T E R L A T I N A M E R I C A Wednesday, January 28, 2009, Vol. 9, No. 19 Headlines A R G E N T I N A BANCO REGIONAL: Moody's Puts 'D-' First-Time Bank Strength Rating FIDEICOMISO FINANCIERO: Moody's Assigns 'Ba1' Global Note Rating INMUNOLAB SA: Trustee Verifying Proofs of Claim Until May 21 SEGONA SA: Trustee Verifying Proofs of Claim Until November 4 B E R M U D A ACA ASSURANCE: Creditors' Proofs of Debt Due on February 6 ACA ASSURANCE: Members' Final Meeting Set for February 25 METRORED GROUP: Creditors' Proofs of Debt Due on February 6 METRORED GROUP: Members' Final Meeting Set for February 24 PREMIER LIFE: Creditors' Proofs of Debt Due on February 6 PREMIER LIFE: Members' Final Meeting Set for February 25 B R A Z I L AMERICAN INT'L: Seeks Bids for Fund Management Business BANCO DO BRASIL: Shares Hit One-Week High After Posting 4Q Gain BANCO DO BRASIL: To Release 2008 Earnings on February 3 GLOBAL CROSSING: Expands Fiber Optic Network in Brazil VITRO SAB: Moody's Downgrades Senior Unsecured Rating to 'Ca' VOTORANTIM PARTICIPACOES: S&P Changes Outlook to Negative VOTORANTIM CELULOSE: Aracruz Deal Cues S&P's Negative CreditWatch * BRAZIL: Local Companies Default Rate Up 36% in December C A Y M A N I S L A N D S AXA NEW HORIZONS: Placed Under Voluntary Liquidation CASTLEROCK AIRCRAFT: Placed Under Voluntary Liquidation CSERE ATRIUM: Placed Under Voluntary Liquidation CSERE DUMFRIES: Placed Under Voluntary Liquidation CSERE MILTON: Placed Under Voluntary Liquidation EIRE HALIFAX: Placed Under Voluntary Liquidation EIRE MANCHESTER: Placed Under Voluntary Liquidation GC GLOBAL: Placed Under Voluntary Liquidation INFINITY ABSOLUTE: Placed Under Voluntary Liquidation NEW HARVEST: Placed Under Voluntary Liquidation NORMA CDO: Placed Under Voluntary Liquidation OFFALY LIMITED: Placed Under Voluntary Liquidation ORIES HOLDING: Placed Under Voluntary Liquidation PANGAEA CLO 2007-2: Placed Under Voluntary Liquidation PORTMARNOCK LIMITED: Placed Under Voluntary Liquidation ROSCOMMON LIMITED: Placed Under Voluntary Liquidation SAL 95: Placed Under Voluntary Liquidation TITANIUM FUND: Placed Under Voluntary Liquidation VINTRY INVESTMENTS: Placed Under Voluntary Liquidation YA 95 A: Placed Under Voluntary Liquidation C O L O M B I A BANCOLOMBIA: Board OKs Issuance of Subordinated Ordinary Notes ECOPETROL: Mulls Petro-Tech Stake Acquisition E C U A D O R * ECUADOR: Sees Oil Prices at US$55 Per Barrel This Year M E X I C O COMERCI: May Sell Land and Credit Unit to Repay Debts LIBRAMIENTO DE MATEHUALA: Moody's Confirms National Scale Rating * MEXICO: Peso & Bond Drop on Concern U.S. Demand to Decline T U R K S & C A I C O S I S L A N D S TCI NEW MEDIA: To Close Down by Months End V E N E Z U E L A * VENEZUELA: OPEC is Ready for More Cuts, President Chavez Says X X X X X X X * CARIBBEAN ISLANDS: Local Resort Adds to Island Job Cuts - - - - - ================= A R G E N T I N A ================= BANCO REGIONAL: Moody's Puts 'D-' First-Time Bank Strength Rating ----------------------------------------------------------------- Moody's Investors Service assigned a first-time bank financial strength rating of D- (minus) to Banco Regional de Cuyo S.A. At the same time, Moody's gave the bank long- and short-term global local-currency deposit ratings of Ba2 and Not Prime, as well as long- and short-term foreign-currency deposit ratings of Caa1 and Not Prime. Moody's also assigned the bank Aa2.ar local-currency and Ba1.ar foreign-currency deposit ratings on the Argentine national scale. The outlooks on all ratings are stable. At the same time, Moody's affirmed Banco Supervielle S.A.'s BFSR of D- (minus) and Ba2/Not Prime and Caa1/Not Prime ratings for global local and foreign currency deposits. Moreover, the national scale of Aa2.ar and Ba1.ar for local and foreign currency deposits were also affirmed. Moody's said the D- BFSR reflects Banco Regional de Cuyo's alignment with Banco Supervielle's (its shareholder´s) ratings. Regional de Cuyo was acquired by Supervielle in September 2008 and it should be absorbed by the parent bank by mid 2009 though retaining its well recognized brand. Although small in size, Regional de Cuyo has adequate financial metrics and a franchise that is focused on lending to small and medium companies, and individuals, mainly in the province of Mendoza, where it has reasonably good branch coverage. Regional de Cuyo's franchise is seen as complementary to Supervielle's, which is active in the neighboring province of San Luis. The ratings therefore, reflect Moody's views that business and operational synergies that can be achieved are positive to the acquisition, as they may translate into earnings and funding diversification, as well as in broader market coverage. The ratings also incorporate the agency's assessment of Regional de Cuyo's risk management practices in light of its limited corporate governance, which derives from the bank's family ownership and lack of board independence. Nevetheless, the ratings also capture the challenges arising from the merger process itself and the operating environment. Moody's also pointed out that Regional de Cuyo faces harsh competition from peers. Moody's Ba2 global local-currency deposit rating reflects Banco Regional de Cuyo's Baseline Credit Assessment of Ba3, as well as Moody's assessment of a high probability that systemic support would be extended to the bank in case of stress because of its relatively important market share in terms of deposits in a consolidated basis. Such an assessment results in a one-notch lift of the local currency rating to Ba2. Banco Regional de Cuyo S.A. is headquartered in Mendoza, Argentina, and it had assets of Ar$ 587.7 million, deposits of Ar$ 473.1 million, and equity of Ar$ 58.7 million, as of September 2008. These ratings were assigned to Banco Regional de Cuyo S.A. -- Bank Financial Strength Rating: D-, with stable outlook. -- Long- and short-term global local-currency deposit ratings: Ba2 and Not Prime, with stable outlook. -- Long- and short-term foreign-currency deposit ratings: Caa1 and Not Prime, with stable outlook. -- Long-Term National Scale Local-Currency Deposit Rating: Aa2.ar, with stable outlook. -- Long -Term National Scale Foreign-Currency Deposit Rating: Ba1.ar, with stable outlook. These Banco Supervielle S.A.'s ratings were affirmed: -- Bank Financial Strength Rating: D-, with stable outlook. -- Long- and short-term global local-currency deposit ratings: Ba2 and Not Prime, with stable outlook. -- Long- and short-term foreign-currency deposit ratings: Caa1 and Not Prime, with stable outlook. -- Long-Term National Scale Local-Currency Deposit Rating: Aa2.ar, with stable outlook. -- Long -Term National Scale Foreign-Currency Deposit Rating: Ba1.ar, with stable outlook. FIDEICOMISO FINANCIERO: Moody's Assigns 'Ba1' Global Note Rating ---------------------------------------------------------------- Moody's Latin America has assigned a rating of Aaa.ar (Argentine National Scale) and of Ba1 (Global Scale, Local Currency) to the Class A Fixed Rate and Floating Rate Debt Securities of Fideicomiso Financiero Supervielle Créditos Banex XXVI issued by Deutsche Bank S.A. - acting solely in its capacity as Issuer and Trustee. This issuance is not an obligation of Deutsche Bank S.A. and therefore the rating assigned does not reflect the credit quality of Deutsche Bank S.A. Moody's also assigned ratings of Caa3.ar (Argentine National Scale) and Caa3 (Global Scale, Local Currency) to the Class B Fixed Rate Securities; and ratings of C.ar (Argentine National Scale) and C (Global Scale, Local Currency) to the subordinated Certificates. The assigned ratings are based on these factors: - The credit quality of the securitized personal loans - The ability and willingness of ANSES to make monthly pensions - The ability of Banco Supervielle to act as the servicer of the pool - The ability of Deutsche Bank S.A. to act as trustee in this transaction - Initial credit enhancement provided through subordination - The availability of various reserve accounts, and - The legal structure of the transaction. The Securitized Pool The rated securities are payable from the cash flow coming from the assets of the trust, which is an amortizing pool of approximately 28,118 eligible personal loans denominated in Argentine pesos, with a fixed interest rate, originated by Banex (now Banco Supervielle), in an aggregate amount of Ar$ 70,000,371. As of September 26, 2008, the cut off rate of the pool, the securitized loans exhibited delinquencies no higher than 30 days past due. These personal loans are granted to pensioners that receive their monthly pensions from ANSES (Argentina's National Governmental Agency of Social Security - Administración Nacional de la Seguridad Social). Banco Supervielle is the payment agent for this government entity and deducts the monthly loan installment directly from the borrower's paycheck. The pool is also constituted by loans granted to government employees of the Province of San Luis. Structure Deutsche Bank S.A. (Issuer and Trustee) issued three classes of Debt Securities (Class A Fixed Rate Securities, Floating Rate Securities and Class B Fixed Rate Securities) and one class of Certificates, all denominated in Argentine pesos. The Class A Fixed Rate Debt Securities will bear a fixed interest rate of 22%. The Floating Rate Debt Securities will bear a BADLAR interest rate plus 425 basis points. The Floating Rate Debt Securities' interest rate will never be higher than 29% or lower than 16%. The Class B Fixed Rate Securities will bear a fixed interest rate of 21%. Overall credit enhancement is comprised of subordination, various reserve funds and excess spread. Rating Methodology Moody's considered the credit enhancement provided in this transaction through the initial subordination levels for each rated class, as well as the historical performance of Supervielle's portfolio. In addition, Moody's considered factors common to consumer loans securitizations such as delinquencies, prepayments and losses; as well as specific factors related to the Argentine market, such as the probability of an increase in losses if there are changes in the macroeconomic scenario in Argentina. These factors were incorporated in a cash flow model that takes into account all the relevant features of the transaction's assets and liabilities. Monte Carlo simulations were run, which determines the expected loss for the rated securities. In assigning the rating to this transaction, Moody's assumed a triangular distribution for losses centered around the most likely scenario of 10%. Also, Moody's assumed a triangular distribution for the prepayments centered around a most likely scenario of 12%. Moody's also considered the risk that a disruption in the flow of payments from ANSES or the Government of San Luis to pensioners and employees respectively, could severely affect the performance of the pool. Moody's believes that the ratings assigned are consistent with this risk. Finally, Moody's also evaluated the back-up servicing arrangements in the transaction. Rating Action Originator: Banco Banex S.A. (now Banco Supervielle S.A.) -- Ar$ 30,100,000 in Class A Fixed Rate Debt Securities of "Fideicomiso Financiero Supervielle Créditos Banex XXVI", rated Aaa.ar (Argentine National Scale) and Ba1 (Global Scale, Local Currency) -- Ar$ 29,400,000 in Floating Rate Debt Securities of "Fideicomiso Financiero Supervielle Créditos Banex XXVI", rated Aaa.ar (Argentine National Scale) and Ba1 (Global Scale, Local Currency) -- Ar$ 7,000,000 in Class B Fixed Rate Debt Securities of "Fideicomiso Financiero Supervielle Créditos Banex XXVI", rated Caa3.ar (Argentine National Scale) and Caa3 (Global Scale, Local Currency) -- Ar$ 3,500,000 in Certificates of "Fideicomiso Financiero Supervielle Créditos Banex XXVI", rated C.ar (Argentine National Scale) and C (Global Scale, Local Currency) INMUNOLAB SA: Trustee Verifying Proofs of Claim Until May 21 ------------------------------------------------------------ The court-appointed trustee for Inmunolab S.A.'s reorganization proceedings will be verifying creditors' proofs of claim until May 21, 2009. Creditors will vote to ratify the completed settlement plan during the assembly on February 17, 2011. SEGONA SA: Trustee Verifying Proofs of Claim Until November 4 ------------------------------------------------------------- The court-appointed trustee for Segona S.A.'s bankruptcy proceedings will be verifying creditors' proofs of claim until November 4, 2008. The trustee will present the validated claims in court as individual reports on December 17, 2008. 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 the company and its creditors. A general report that contains an audit of the company's accounting and banking records will be submitted in court on March 6, 2009. ============= B E R M U D A ============= ACA ASSURANCE: Creditors' Proofs of Debt Due on February 6 ---------------------------------------------------------- The creditors of ACA Assurance, Ltd. are required to file their proofs of debt by February 6, 2009, to be included in the company's dividend distribution. The company commenced liquidation proceedings on Jan. 22, 2009. The company's liquidator is: Robin J. Mayor Clarendon House Church Street, Hamilton Bermuda ACA ASSURANCE: Members' Final Meeting Set for February 25 --------------------------------------------------------- The members of ACA Assurance, Ltd. will hold their final general meeting on February 25, 2009, at 9:30 a.m., to hear the liquidator's report on the company's wind-up proceedings and property disposal. The company commenced liquidation proceedings on Jan. 22, 2009. The company's liquidator is: Robin J. Mayor Clarendon House Church Street, Hamilton Bermuda METRORED GROUP: Creditors' Proofs of Debt Due on February 6 ----------------------------------------------------------- The creditors of Metrored Group, Ltd. are required to file their proofs of debt by February 6, 2009, to be included in the company's dividend distribution. The company commenced liquidation proceedings on Jan. 23, 2009. The company's liquidator is: Robin J. Mayor Clarendon House Church Street, Hamilton Bermuda METRORED GROUP: Members' Final Meeting Set for February 24 ---------------------------------------------------------- The members of Metrored Group, Ltd. will hold their final general meeting on February 24, 2009, at 9:30 a.m., to hear the liquidator's report on the company's wind-up proceedings and property disposal. The company commenced liquidation proceedings on Jan. 23, 2009. The company's liquidator is: Robin J. Mayor Clarendon House Church Street, Hamilton Bermuda PREMIER LIFE: Creditors' Proofs of Debt Due on February 6 --------------------------------------------------------- The creditors of Premier Life (Bermuda) Limited are required to file their proofs of debt by February 6, 2009, to be included in the company's dividend distribution. The company commenced liquidation proceedings on Jan. 22, 2009. The company's liquidator is: Ronald D. Hunter 10689 North Pennsylvania Indianapolis, Indiana USA PREMIER LIFE: Members' Final Meeting Set for February 25 -------------------------------------------------------- The members of Premier Life (Bermuda) Limited will hold their final general meeting on February 25, 2009, at 9:30 a.m., to hear the liquidator's report on the company's wind-up proceedings and property disposal. The company commenced liquidation proceedings on Jan. 22, 2009. The company's liquidator is: Ronald D. Hunter 10689 North Pennsylvania Indianapolis, Indiana USA =========== B R A Z I L =========== AMERICAN INT'L: Seeks Bids for Fund Management Business ------------------------------------------------------- American International Group Inc plans to divest its Fund Management Business, which operates 15 existing fund programs with over US$12.4 billion in assets under management and US$5.2 billion in equity capital commitments as of September 30, 2008. In a statement Monday, AIG said the Fund Management Business is a global asset advisor headquartered in New York with regional operations in Europe, Japan, Latin America and Asia and includes committed equity capital that has been funded or is to be funded by AIG as a sponsor or co-investor. Bank of America and Merrill Lynch, GRE's financial advisors, have begun to solicit interest for the Fund Management Business. Separately, Bloomberg News reports that according to Reuters, AIG has received bids from investors including sovereign wealth funds in Singapore, China and the Middle East for its aircraft leasing unit, International Lease Finance Corp. The report relates Reuters's sources said among the initial bidders for the unit are Singapore's Temasek Holdings Pte, Dubai's investment arm Istithmar World, the Kuwait Investment Authority and China Investment Corp. Private equity firms including Carlyle Group, TPG Capital LP and Kohlberg Kravis Roberts & Co. are also bidding, the report says citing Reuters. While the timing of the auction for the unit, which could be worth as much as US$8 billion, is unclear, the second round of bids could come in the third week of February, Bloomberg News adds, citing Reuters. About AIG Based in New York, American International Group, Inc. (AIG) is the leading international insurance organization with operation in more than 130 countries and jurisdictions. AIG companies serve commercial, institutional and individual customers through the most extensive worldwide property-casualty and life insurance networks of any insurer. In addition, AIG companies are leading providers of retirement services, financial services and asset management around the world. AIG's common stock is listed on the New York Stock Exchange, as well as the stock exchanges in Ireland and Tokyo. During the third quarter of 2008, requirements to post collateral in connection with AIG Financial Products Corp.'s credit default swap portfolio and other AIGFP transactions and to fund returns of securities lending collateral placed stress on AIG's liquidity. AIG's stock price declined from US$22.76 on Sept. 8, 2008, to US$4.76 on Sept. 15, 2008. On that date, AIG's long-term debt ratings were downgraded by Standard & Poor's, a division of The McGraw- Hill Companies, Inc., Moody's Investors Service and Fitch Ratings, which triggered additional requirements for liquidity. These and other events severely limited AIG's access to debt and equity markets. On Sept. 22, 2008, AIG entered into an US$85 billion revolving credit agreement with the Federal Reserve Bank of New York and, pursuant to the Fed Credit Agreement, AIG agreed to issue 100,000 shares of Series C Perpetual, Convertible, Participating Preferred Stock to a trust for the benefit of the United States Treasury. At Sept. 30, 2008, amounts owed under the facility created pursuant to the Fed Credit Agreement totaled US$63 billion, including accrued fees and interest. Since Sept. 30, AIG has borrowed additional amounts under the Fed Facility and has announced plans to sell assets and businesses to repay amounts owed in connection with the Fed Credit Agreement. In addition, subsequent to Sept. 30, 2008, certain of AIG's domestic life insurance subsidiaries entered into an agreement with the NY Fed pursuant to which the NY Fed has borrowed, in return for cash collateral, investment grade fixed maturity securities from the insurance subsidiaries. On Nov. 10, 2008, the U.S. Treasury agreed to purchase, through its Troubled Asset Relief Program, US$40 billion of newly issued AIG perpetual preferred shares and warrants to purchase a number of shares of common stock of AIG equal to 2% of the issued and outstanding shares as of the purchase date. All of the proceeds will be used to pay down a portion of the Federal Reserve Bank of New York credit facility. The perpetual preferred shares will carry a 10% coupon with cumulative dividends. AIG and the Fed also agreed to revise the existing FRBNY credit facility. The loan terms were extended from two to five years to give AIG time to complete its planned asset sales in an orderly manner. The equity interest that taxpayers will hold in AIG, coupled with the warrants, will total 79.9%. At Sept. 30, 2008, AIG had US$1.022 trillion in total consolidated assets and US$950.9 billion in total debts. Shareholders' equity was US$71.18 billion, including the addition of US$23 billion of consideration received for preferred stock not yet issued. BANCO DO BRASIL: Shares Hit One-Week High After Posting 4Q Gain --------------------------------------------------------------- Banco do Brasil SA's shares climbed 6.1% to BRL14.11 on Jan. 26, the highest closing price since Jan. 19, after saying it will report an extraordinary gain in the fourth quarter, Telma Marotto of Bloomberg News reports. As reported in the Troubled Company Reporter-Latin America on January 27, 2009, Bloomberg News said Banco do Brasil said it will have a one-time gain of BRL2.52 billion (US$1 billion) in the fourth quarter. The report related CVM, Brazil securities regulator, said the bank will post a BRL5.3 billion profit from its pension fund plans and BRL2.8 billion in losses related to its health plans and taxes. "The recent announcement allows a significant improvement in BB's balance sheet indicators and should serve as a catalyst for the stock," Bloomberg News quoted Jorg Friedemann, analyst with Bank of America Merrill Lynch, as saying. According to the report, the bank also said it will set aside an additional BRL1.7 billion for bad loans because of a possible increase in default rates. Bloomberg News notes Mario Pierry, Deutsche Bank AG analyst, maintained a "buy" rating for Banco do Brasil. Saul Martinez, an analyst with JPMorgan Chase & Co, estimated the gain will boost fourth-quarter profit by about BRL1.5 billion after taxes, Bloomberg News adds. About Banco do Brasil Banco do Brasil SA is Brazil's federal bank and is the largest in Latin America with some 20 million clients and more than 7,000 points of sale (3,200 branches) in Brazil, and 34 offices and partnerships in 26 other countries. In addition to its traditional retail banking services, Banco do Brasil underwrites and sells bonds, conducts asset trading, offers investors portfolio management services, conducts financial securities advising, and provides market analysis and research. * * * As reported by the Troubled Company Reporter - Latin America on Jan. 20, 2009, Fitch Ratings affirmed these ratings of Banco do Brasil S.A.: -- Long-term foreign and local currency Issuer Default Rating at 'BBB-' -- Short-term foreign and local currency IDR at 'F3' -- Support Rating at '2' -- Individual Rating at 'C/D' -- Support Rating Floor at 'BBB-' -- National Long-term rating at 'AA+(bra)' -- National Short-term rating at 'F1+(bra)' BANCO DO BRASIL: To Release 2008 Earnings on February 3 ------------------------------------------------------- Banco do Brasil SA will release its 2008 Earnings Results through a conference call webcast on Tuesday, February 3, 2009 at 8:30 AM ET. To participate, log-on to its website at http://www.prnewswireweb.com.br/player/?id=347 or contact: Jean Philippe Leroy at 55-11-2178-6229; or Ivani Benazzi de Andrade at 55-11-2178-6218 Banco do Brasil SA is Brazil's federal bank and is the largest in Latin America with some 20 million clients and more than 7,000 points of sale (3,200 branches) in Brazil, and 34 offices and partnerships in 26 other countries. In addition to its traditional retail banking services, Banco do Brasil underwrites and sells bonds, conducts asset trading, offers investors portfolio management services, conducts financial securities advising, and provides market analysis and research. * * * As reported by the Troubled Company Reporter - Latin America on Jan. 20, 2009, Fitch Ratings affirmed these ratings of Banco do Brasil S.A.: -- Long-term foreign and local currency Issuer Default Rating at 'BBB-' -- Short-term foreign and local currency IDR at 'F3' -- Support Rating at '2' -- Individual Rating at 'C/D' -- Support Rating Floor at 'BBB-' -- National Long-term rating at 'AA+(bra)' -- National Short-term rating at 'F1+(bra)' GLOBAL CROSSING: Expands Fiber Optic Network in Brazil ------------------------------------------------------ Global Crossing has completed the construction of a new, 126 km fiber optic network in the interior region of the state of Sao Paulo, interconnecting the cities of Hortolandia and Sorocaba. Previously, Global Crossing had a number of circuits in that region, but depended on other providers to complete its back-up or redundancy capability. With the new seamless network, which has 18 pairs of fibers, Global Crossing is now able to better serve its customers' needs, while increasing the security and reliability of the services. "This new ring shows Global Crossing's commitment to the Brazilian market, as the company continues to strategically invest in network infrastructure and top-notch technologies to constantly improve the quality and the reach of the services that we provide to our customers regionally and globally," said Marcos Malfatti, senior sales vice president for Global Crossing Brazil. "Additionally, we will be able to generate more business opportunities and enable more routes now." The new ring is part of Global Crossing's metropolitan networks in Brazil. Currently, Global Crossing has 15 metropolitan networks and 15 data centers in Latin America. The company owns one of the world's largest IP-based fiber optic networks, which reaches more than 60 countries worldwide. About Global Crossing Headquartered in Florham Park, New Jersey, Global Crossing Ltd. (NASDAQ: GLBC) -- http://www.globalcrossing.com/-- is a leading global IP solutions provider with the world's first integrated global IP-based network. The company offers a full range of secure data, voice, and video products to approximately 40 percent of the Fortune 500, as well as to 700 carriers, mobile operators and ISPs. It delivers services to more than 690 cities in more than 60 countries and six continents around the globe. In Latin America, Global Crossing´s business has operations in Argentina, Brazil, Chile, Colombia, Ecuador, Panama, Peru, Mexico, Venezuela, the United States (Florida) and the Caribbean region. In addition to its IP-based, fiber-optic network, Global Crossing's regional infrastructure includes 15 metropolitan networks and 15 world-class data centers located in the main business centers of Latin America. * * * As reported by the Troubled Company Reporter-Latin America on Jan. 23, 2009, Moody's Investors Service assigned a Caa1 corporate family rating to Global Crossing Limited and a B2 rating to the company's US$350 million senior secured term loan. The preferential access to realization proceeds provided by the security package allows the term loan credit facility's rating to be B2, two notches above the Caa1 CFR. GCL was also assigned a speculative grade liquidity rating of SGL-3 (indicating adequate liquidity). The ratings outlook is stable. VITRO SAB: Moody's Downgrades Senior Unsecured Rating to 'Ca' ------------------------------------------------------------- Moody's Investors Service downgraded Vitro, S.A.B. de C.V.'s senior unsecured debt and corporate family ratings to Ca from Caa1. This rating action concludes the rating review initiated on October 30, 2008. The ratings outlook is negative. The downgrade reflects Moody's belief that Vitro's liquidity has continued to weaken in the past several weeks as economic conditions in the company's key markets have deteriorated further, increasing the likelihood that it may not be able to meet its upcoming near term financial obligations. The latter include a US$45 million coupon payment on February 1, 2009 under its 2012 and 2017 notes and an estimated US$20 million in long term debt maturities during 1Q09. The company also has a contractual commitment to pay about US$29 million in remaining ten monthly installments during 2009, related to the put option exercised by its Spanish joint venture partner in 2008. As of September 30, 2008, Vitro had US$72 million in unrestricted cash reserves, covering short term debt 0.46 times. For the 12 months ended September 30, 2008, estimated free cash flow was a negative US$135 million after dividends, requiring continued rollover of an estimated US$70 million in revolving short term bank debt mainly located at operating subsidiaries. The receipt of the outstanding US$20 million payment related to Vitro's Vimex plant, expected for December 2008, would provide modest, though only limited, upside to the company's current liquidity position. Moody's believes that continued cyclical earnings pressures may cause free cash flow to remain weak during 2009 despite significant ongoing cost reduction efforts and a likely material cut in capital spending. In addition, on December 18, 2008, Vitro announced that it expects significantly lower revenues from Modelo in 2009, its largest glass container client, likely exacerbating margin pressures. In recent years, Modelo has accounted for around 14% of the revenues of Vitro's glass container division and 7% of its consolidated revenues, implying significantly lower capacity utilization should most of these sales be lost without other clients substituting for them. While Vitro's adjusted LTM Debt/EBITDA was about 4.4 times, pro forma leverage would have been significantly higher, well above 5.0 times, when including US$100 million in off-balance sheet debt from Bancomext obtained in November 2008 plus an assumed US$235 million in derivative liabilities (still under negotiation; net of US$85 million in collateral), and excluding debt and EBITDA related to its Comegua joint venture, which was deconsolidated in December 2008. The Ca rating reflects the expectation of modest recovery for the senior unsecured debt class in the case of default. The negative outlook reflects the risk that ultimate recovery level may be lower than currently expected. The last rating action on Vitro was on October 30, 2008, when Moody's downgraded the company's ratings to Caa1 from B2 and left the ratings on review for further downgrade. Headquartered in Monterrey, Mexico, Vitro, S.A.B. de C.V., is Mexico's leading glass manufacturer with revenues of US$2.75 billion for the 12 months ended September 30, 2008. Vitro operates through two divisions, glass containers and flat glass, which cater to a wide range of end markets, including the construction and automotive sectors for flat glass and the soft drink, beer, wine and liquor, food and cosmetics industries for glass containers. VOTORANTIM PARTICIPACOES: S&P Changes Outlook to Negative --------------------------------------------------------- Standard & Poor's Ratings Services said that it revised its outlook on Brazil-based conglomerate Votorantim Participacoes S.A. to negative from stable. At the same time, S&P affirmed its 'BBB' corporate credit rating on the company. "The outlook revision reflects the increasing uncertainty that the group's consolidated credit metrics will meet S&P's long-term targets for the current rating amid the negative operating and financial outlook for 2009," said Standard & Poor's credit analyst Reginaldo Takara. The group's main business units are already facing unfavorable pricing and market conditions, at a time when consolidated financial leverage is historically high after significant investments in capacity expansions and acquisitions. Therefore, S&P believes it will take longer for credit metrics to converge with S&P's long-term targets, built into the rating, of total debt to EBITDA of less than 2x and funds from operations to total debt of more than 35% until 2010 or 2011. However, although the difficult economy will pressure cash flow, S&P believes the group has room to adjust its strategy to preserve liquidity and reduce net debt, bringing cash flow coverage more in line with the current ratings. Recent strategic moves related to Banco Votorantim S.A. (BV; BB+/Stable/B) and Aracruz Celulose S.A. (BB/Watch Pos/--) show that the group can consolidate its business lines while reducing the holding company's direct exposure. The ratings on VPar continue to reflect its broad business diversification in segments benefiting from strong fundamentals and low business correlation, for historically stable operating margins and cash flows. The rating also reflects VPar's moderate financial policy, which has helped it achieve very strong liquidity and appropriate net debt levels. These positives are balanced by VPar's significant geographic concentration and high gross debt relative to its own history and the rating category -- particularly at a time when cash flow is under pressure and refinancing conditions have deteriorated generally. The ratings also take into account the positive effect of the sale of a 49.9% voting stake in BV to Banco do Brasil S.A. (BdB; BBB-/Stable/A-3), which modestly reinforced the group's liquidity but significantly reduced its exposure to the more volatile financial sector. VOTORANTIM CELULOSE: Aracruz Deal Cues S&P's Negative CreditWatch ----------------------------------------------------------------- A previously published version of this report incorrectly identified the entities that are to provide additional capital to VCP. A corrected version follows. Standard & Poor's Ratings Services said that it placed its 'BBB' corporate credit rating on Votorantim Celulose e Papel S.A. on CreditWatch with negative implications. At the same time, S&P placed its 'BB' corporate credit rating on Aracruz Celulose S.A. on CreditWatch with positive implications. The CreditWatch listings follow VCP's announcement that it has reached an agreement to acquire 28.03% of the voting shares of Aracruz held by Arapar S.A. (unrated) for BRL2.71 billion (about US$1.18 billion). Because the third controlling shareholder of Aracruz, Arainvest Participacoees S.A. (unrated), has tag-along rights, the offer includes an equivalent offer for Arainvest's voting shares. If this offer is accepted, it would give VCP control of 84% of Aracruz's voting shares. The acquisition plan anticipates BRL4.25 billion in capitalization for VCP, which is to include fresh money from Votorantim Industrial (VID; unrated), BNDES Participacoes S.A. (BNDESPar; unrated), and potentially from existing minority shareholders. After the conclusion of the acquisition, and assuming that Arainvest will not exercise its preferential rights on Aracruz's shares, VCP and Aracruz would become a single economic entity, listed on the Brazilian Stock Exchange and controlled by VID and BNDESPar through a shareholders' agreement. The consolidation of VCP and Aracruz would strengthen their leadership in market pulp, with a total capacity of 5.8 million tons per year. "We expect the larger scale of the new entity to generate synergies and cost savings in administrative expenses, production, capital investments, and logistics, improving the company's cost position and business profile," said Standard & Poor's credit analyst Marcelo Costa. "However, the significant increase in leverage resulting from the share acquisition and from the losses Aracruz has reported in its derivative position would raise financial risk at the new company." Resolution of the CreditWatch listing will depend on the conclusion of the offer and S&P's assessment of the new entity's credit risk. S&P will monitor the resulting ownership and corporate structure, debt leverage and amortization profile, revised capital spending program, amount of new money VCP is to receive in its planned capitalization, and synergies that this merger might capture. * BRAZIL: Local Companies Default Rate Up 36% in December ---------------------------------------------------------- The default rate of Brazilian companies increased 36% in December from the same period in 2007, the highest increase since 1999, Xinhua News reports, citing a study released by credit consulting company Serasa Experian. According to the report, December's default rate was up 5.9% from November. In 2008, the default rate among Brazilian companies was up 4.8% compared with 2007, the report says. Serasa Experian, the report notes, said the high default rate was caused by the international financial crisis and its impact on Brazil, namely the reduction of both credit and demand. Xinhua News adds Serasa Experian said an increase the default rate of consumers, also caused by the crisis, was another factor in the default rate of the companies. * * * According to Moody's Rating Agency, the country continues to carry a BA1 local and foreign currency rating. ========================== C A Y M A N I S L A N D S ========================== AXA NEW HORIZONS: Placed Under Voluntary Liquidation ---------------------------------------------------- On December 8, 2008, the sole shareholder of AXA New Horizons Cayman Fund, Ltd. passed a written resolution that voluntarily wind up the company's operations. The company's liquidator is: Walkers SPV Limited c/o Anthony Johnson Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002, Cayman Islands Telephone: (345) 914-6314 CASTLEROCK AIRCRAFT: Placed Under Voluntary Liquidation ------------------------------------------------------- On December 10, 2008, the sole shareholder of Castlerock Aircraft Limited passed a written resolution that voluntarily wind up the company's operations. The company's liquidator is: Walkers SPV Limited c/o Anthony Johnson Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002, Cayman Islands Telephone: (345) 914-6314 CSERE ATRIUM: Placed Under Voluntary Liquidation ------------------------------------------------ On December 10, 2008, the sole shareholder of Csere Atrium (Freehold) Limited passed a written resolution that voluntarily wind up the company's operations. The company's liquidator is: Walkers SPV Limited c/o Anthony Johnson Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002, Cayman Islands Telephone: (345) 914-6314 CSERE DUMFRIES: Placed Under Voluntary Liquidation ------------------------------------------------ On December 10, 2008, the sole shareholder of Csere Dumfries (Freehold) Limited passed a written resolution that voluntarily wind up the company's operations. The company's liquidator is: Walkers SPV Limited c/o Anthony Johnson Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002, Cayman Islands Telephone: (345) 914-6314 CSERE MILTON: Placed Under Voluntary Liquidation ------------------------------------------------ On December 10, 2008, the sole shareholder of Csere Milton Keynes (Freehold) Limited passed a written resolution that voluntarily wind up the company's operations. The company's liquidator is: Walkers SPV Limited c/o Anthony Johnson Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002, Cayman Islands Telephone: (345) 914-6314 EIRE HALIFAX: Placed Under Voluntary Liquidation ------------------------------------------------ On December 10, 2008, the sole shareholder of Eire Halifax (Freehold) Limited passed a written resolution that voluntarily wind up the company's operations. The company's liquidator is: Walkers SPV Limited c/o Anthony Johnson Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002, Cayman Islands Telephone: (345) 914-6314 EIRE MANCHESTER: Placed Under Voluntary Liquidation --------------------------------------------------- On December 10, 2008, the sole shareholder of Eire Manchester (Freehold) Limited passed a written resolution that voluntarily wind up the company's operations. The company's liquidator is: Walkers SPV Limited c/o Anthony Johnson Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002, Cayman Islands Telephone: (345) 914-6314 GC GLOBAL: Placed Under Voluntary Liquidation --------------------------------------------- On December 9, 2008, the sole shareholder of GC Global Partners Offshore I, Ltd. passed a written resolution that voluntarily wind up the company's operations. The company's liquidator is: Walkers SPV Limited c/o Anthony Johnson Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002, Cayman Islands Telephone: (345) 914-6314 INFINITY ABSOLUTE: Placed Under Voluntary Liquidation ----------------------------------------------------- On December 10, 2008, the sole shareholder of Infinity Absolute Fund passed a written resolution that voluntarily wind up the company's operations. The company's liquidator is: Walkers SPV Limited c/o Anthony Johnson Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002, Cayman Islands Telephone: (345) 914-6314 NEW HARVEST: Placed Under Voluntary Liquidation ----------------------------------------------- On December 10, 2008, the sole shareholder of New Harvest Investment Limited passed a written resolution that voluntarily wind up the company's operations. The company's liquidator is: Walkers SPV Limited c/o Anthony Johnson Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002, Cayman Islands Telephone: (345) 914-6314 NORMA CDO: Placed Under Voluntary Liquidation --------------------------------------------- On December 10, 2008, the sole shareholder of Norma CDO I Ltd. resolved through a written resolution to voluntarily wind up the company's operations. The company's liquidator is: Walkers SPV Limited c/o Anthony Johnson Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002, Cayman Islands Telephone: (345) 914-6314 OFFALY LIMITED: Placed Under Voluntary Liquidation -------------------------------------------------- On December 10, 2008, the sole shareholder of Offaly Limited passed a written resolution that voluntarily wind up the company's operations. The company's liquidator is: Walkers SPV Limited c/o Anthony Johnson Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002, Cayman Islands Telephone: (345) 914-6314 ORIES HOLDING: Placed Under Voluntary Liquidation ------------------------------------------------- On December 10, 2008, the sole shareholder of Ories Holding Company passed a written resolution that voluntarily wind up the company's operations. The company's liquidator is: Walkers SPV Limited c/o Anthony Johnson Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002, Cayman Islands Telephone: (345) 914-6314 PANGAEA CLO 2007-2: Placed Under Voluntary Liquidation ------------------------------------------------------ On December 10, 2008, the sole shareholder of Pangaea CLO 2007-2 Ltd. passed a written resolution that voluntarily wind up the company's operations. The company's liquidator is: Walkers SPV Limited c/o Anthony Johnson Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002, Cayman Islands Telephone: (345) 914-6314 PORTMARNOCK LIMITED: Placed Under Voluntary Liquidation ------------------------------------------------------- On December 10, 2008, the sole shareholder of Portmarnock Limited passed a written resolution that voluntarily wind up the company's operations. The company's liquidator is: Walkers SPV Limited c/o Anthony Johnson Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002, Cayman Islands Telephone: (345) 914-6314 ROSCOMMON LIMITED: Placed Under Voluntary Liquidation ----------------------------------------------------- On December 10, 2008, the sole shareholder of Roscommon Limited passed a written resolution that voluntarily wind up the company's operations. The company's liquidator is: Walkers SPV Limited c/o Anthony Johnson Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002, Cayman Islands Telephone: (345) 914-6314 SAL 95: Placed Under Voluntary Liquidation ------------------------------------------ On December 10, 2008, the shareholder of Sal 95 Limited passed a resolution that voluntarily wind up the company's operations. The company's liquidator is: Trident Liquidators (Cayman) Limited c/o Philip Sutcliffe Trident Trust Company (Cayman) Limited P.O. Box 847, George Town Grand Cayman KY1-1103 Telephone: (345) 949 0880 Facsimile: (345) 949 0881 TITANIUM FUND: Placed Under Voluntary Liquidation ------------------------------------------------- On December 10, 2008, the sole shareholder of Titanium Fund passed a written resolution that voluntarily wind up the company's operations. The company's liquidator is: Walkers SPV Limited c/o Anthony Johnson Walker House, 87 Mary Street, George Town Grand Cayman KY1-9002, Cayman Islands Telephone: (345) 914-6314 VINTRY INVESTMENTS: Placed Under Voluntary Liquidation ------------------------------------------------------ At an extraordinary general meeting held on December 9, 2008, the members of Vintry Investments (Cayman) Limited resolved to voluntarily liquidate the company's business. The company's liquidator is: Jonathan Foster c/o Messrs. Maples and Calder, Attorneys-at-law PO Box 309, Ugland House Grand Cayman KY1-1104, Cayman Islands YA 95 A: Placed Under Voluntary Liquidation ------------------------------------------- On December 11, 2008, the shareholder of YA 95 A Limited passed a resolution that voluntarily wind up the company's operations. The company's liquidator is: Trident Liquidators (Cayman) Limited c/o Philip Sutcliffe Trident Trust Company (Cayman) Limited P.O. Box 847, George Town Grand Cayman KY1-1103 Telephone: (345) 949 0880 Facsimile: (345) 949 0881 =============== C O L O M B I A =============== BANCOLOMBIA: Board OKs Issuance of Subordinated Ordinary Notes ------------------------------------------------------------- Bancolombia S.A.'s Board of Directors approved the issuance of Bonos Ordinarios Subordinados: -- The Subordinated Ordinary Notes will be offered in Colombia in multiple and successive issuances up to an aggregate principal amount of one trillion Colombian pesos (Ps$1,000,000,000,000). -- According to the Reglamento de Emision y Colocacion de Multiples y Sucesivas Emisiones de Bonos Ordinarios Subordinados (the "Subordinated Ordinary Notes Terms") approved by the Board of Directors of Bancolombia, which define the financial terms and maximum interest rates of the Subordinated Ordinary Notes, the issuances of Subordinated Ordinary Notes may consist of multiple series. -- The Board of Directors of Bancolombia authorized the legal representative of Bancolombia to conduct the offerings of the Subordinated Ordinary Notes pursuant to the Subordinated Ordinary Notes Terms and to carry out any actions necessary for the issuance of the Subordinated Ordinary Notes, including obtaining government approvals. The proceeds from the offerings will be used for general corporate purposes of Bancolombia, which include carrying out the business authorized to financial institutions in accordance with applicable law. About Bancolombia S.A. Bancolombia S.A. is Colombia's largest full-service financial institution, formed by a merger of three leading Colombian financial institutions. Bancolombia's market capitalization is over US$5.5 billion, with US$13.8 billion asset base and US$1.4 billion in shareholders' equity as of Sept. 30, 2006. Bancolombia is the only Colombian company with an ADR level III program in the New York Stock Exchange. * * * As reported in the Troubled Company Reporter-Latin America on June 23, 2008, Moody's Investors Service upgraded to Ba2, stable from Ba3, positive the foreign-currency deposit ratings assigned to the two banks it rates in Colombia. This action is the direct result of Moody's decision to upgrade Colombia's foreign currency country ceilings for bonds and deposits to Baa3 and Ba2, respectively. At the same time, Moody's upgraded Bancolombia's foreign currency subordinated bond rating to Baa3 from Ba1. The outlook is stable. ECOPETROL: Mulls Petro-Tech Stake Acquisition --------------------------------------------- Ecopetrol SA may buy crude oil producer Petro-Tech Peruana SA, as it plans to increase investment in Peru's oil and natural gas industry, Alex Emery of Bloomberg News reports, citing Colombian Energy Minister Hernan Martinez. "Yes, it's a possibility that we have been looking at, and obviously, we are continuing to evaluate it. It's one of the possible ways to expand Colombian investments in Peru," Reuters quoted Minister Martinez as saying. Ecopetrol President Javier Gutierre, Bloomberg News relates, said the company plans to spend US$60 billion by 2015 to meet its goal of pumping 1 million barrels a day, up from this year's 650,000 barrels, and to more than double its refining capacity. Of US$6.2 billion in planned spending for next year, including US$1 billion for exploration, US$2.72 billion for boosting output and US$870 million for acquisitions, President Gutierrez said, the same report relates. Reuters says Peru's government is actively encouraging foreign companies to invest to help boost oil and gas output. Last year, Reuters recounts, Chinese state oil firms were reported to be preparing bids for Petro-Tech, a deal that was then estimated to be worth between US$1.5 and US$2.5 billion. About Petro-Tech Petro-Tech, a unit of Houston-based Offshore International Group, produces 11,000 barrels per day of crude and 15.6 million cubic feet of gas. About Ecopetrol S.A. Ecopetrol S.A. -- http://www.ecopetrol.com.co.-- is the largest company in Colombia as measured by revenue, profit, assets and shareholders' equity. The company is Colombia's only vertically integrated crude oil and natural gas company with operations in Colombia and overseas. Ecopetrol is one of the 40 largest petroleum companies in the world and one of the four principal petroleum companies in Latin America. It is majority owned by the Republic of Colombia and its shares trade on the Bolsa de Valores de Colombia S.A. (BVC) under the symbol ECOPETROL. The company divides its operations into four business segments that include exploration and production; transportation; refining; and marketing of crude oil, natural gas and refined-products. * * * As reported by the Troubled Company Reporter-Latin America on November 12, 2008, Fitch Ratings affirmed Ecopetrol S.A.'s foreign and local currency issuer default ratings at 'BB+' and 'BBB-', respectively. The Rating Outlook is Stable. ============= E C U A D O R ============= * ECUADOR: Sees Oil Prices at US$55 Per Barrel This Year -------------------------------------------------------- OPEC member Ecuador sees oil prices averaging around US$55 per barrel this year, Alonso Soto of Reuters reports, citing Oil Minister Derlis Palacios. "Ecuador has restructured its 2009 budget with a WTI (West Texas Intermediate) price of US$55 per barrel ... we are talking about around US$40 for our oil," Reuters quoted Minister Palacios as saying. According to the report, Ecuador has slashed investment in its key energy sector as falling oil prices curtailed income. As reported in the Troubled Company Reporter Latin-America on January 27, 2009, The Latin America Herald Tribune said state oil company Petroecuador will carry out a restructuring plan that includes eliminating 1,500 jobs. Reuters says lower state investment could hurt the country's oil output already hit by dwindling private investment as the government tries to rework current foreign oil deals * * * As reported in the Troubled Company Reporter - Latin America on December 17, 2008, Fitch Ratings downgraded Ecuador's long-term foreign currency Issuer Default Rating (IDR) to 'RD' from 'CCC' following the expiration of the grace period for the coupon payment on the 2012 global bonds that was due on Nov. 15 and the government's announcement that it will selectively default on all global bonds. The short-term foreign currency rating was downgraded to 'D' from 'C'. The country ceiling remains at 'B-'. =========== M E X I C O =========== COMERCI: May Sell Land and Credit Unit to Repay Debts ----------------------------------------------------- Controladora Comercial Mexicana SAB de CV ("Comerci") may sell land and Prestacomer credit unit to pay off creditors, Bu Hugh Collins Bloombeg News reports, citing Excelsior. Bloomberg News relates Excelsior reported that Jose Calvillo, the Comercial Mexicana executive overseeing the company's debt restructuring, said the supermarket chain is considering selling assets outside of its main business to repay debts estimated at US$2 billion. As reported in the Troubled Company Reporter - Latin America on November 28, 2008, Reuters said Comerci's holders of around MP1.5 billion (US$114 million) want all their money, without a negotiated reduction, after the company defaulted due to the global crisis and plummeting peso. The report related that Comerci failed to make payments on local notes held by some 1,000 investors, from funds to individuals, and was expected by analysts to try to negotiate reduced payments. Reuters noted that the retailer's creditors include six banks that backed up its trading in derivatives for over US$1 billion, five banks that extended loans, as well as bond holders. The company has made two failed attempts in recent weeks to obtain protection from creditors and is currently fighting in court for a favorable ruling, the report added. About Comerci Controladora Comercial Mexicana SAB de CV (CCM) -- http://www.comerci.com.mx -- is a Mexican holding company that, through its subsidiaries, operates several chains of retail stores, as well as a chain of family restaurants under the Restaurantes California brand name. In addition, CCM owns a 50% interest in the Costco de Mexico, a joint venture with Costco Wholesale Corporation, which operates a chain of membership warehouses in Mexico. The Company's store chains include Comercial Mexicana, City Market, Mega, Bodega CM, Sumesa and Alprecio, among others. As of December 31, 2007, CCM operated 214 commercial units and 71 restaurants across Mexico. The Company's retail outlets sell a variety of food items, including basic groceries and perishables, and non-food items, which include electronics, home furnishings, personal hygiene products and clothing. CCM is a parent of Tiendas Comercial Mexicana SA de CV, Tiendas Sumesa SA de CV, Restaurantes California SA de CV and Costco de Mexico SA de CV, among others. LIBRAMIENTO DE MATEHUALA: Moody's Confirms National Scale Rating ---------------------------------------------------------------- Moody's has confirmed the Aa2.mx (Mexico National Scale Rating) on the Libramiento de Matehuala Toll Road. The last rating action on Libramiento de Matehuala was on July 3, 2008 when the Mexico National Scale Rating was changed to Aa2.mx from Aaa.mx and put under review for downgrade, pending evaluation of the project's operating and financial performance and expectations for the future. The last rating action reflected the downgrade of XL Capital Assurance to B2 from A3 which resulted in the mapping of the Mexican National Scale Rating to the project's underlying rating of Baa3 (Global Scale) rather than to the rating of the guarantor. The confirmation of the Aa2.mx is based on the positive trends in traffic and revenues as well as the factors comparing favorably to those of other rated toll roads in Mexico. Moody's affirms the Libramiento de Matehuala's underlying rating of Baa3 (Global Scale, Local Currency Rating) with a stable outlook. The ratings reflect an assessment of the rating factors outlined in the Moody's Rating Methodology for Operational Toll Roads. The toll road is performing well, as evidenced by the increases in both traffic and revenues over the last three year period (2006- 2008). On average, total traffic has increased close to 9% annually during this time, and Average Annual Daily Traffic has exceeded the expectations generated in the base case scenario. The increases in traffic compare favorably to the GDP growth in Mexico and the U.S., which expanded at 3.4% and 2.3% respectively during this period. Given the nature of the road along the NAFTA corridor, its success depends more on the broader economic situation of Mexico and the United States, than that of the immediate area, which is relatively limited. Historically, revenues have also performed satisfactorily, increasing 15% annually on average over the same three year period spanning 2006- 2008. Given the economic recession in the U.S. and the global financial crisis, the expectation is that trade related traffic will decline in 2009 as consumer demand in the United States continues to tighten. Once the U.S. and Mexican economies begin a process of recovery, Moody's expect at least moderate increases in trade related traffic. The project should, however, be able to withstand a period of declining traffic, if that occurs, given their current levels of debt service coverage and the amount held in the debt service reserve account. Debt service coverage has been satisfactory over the last two full years. In 2006 and 2007, the project generated a DSCR averaging 1.7x. The preliminary estimate for 2008 is that DSCR will be in the same range. The debt structure provides relatively strong investor protections including use of all excess cash to pay down principal. The structure does not allow for dividend payments until all senior debt is paid off. The project has been making additional principal payments and hence the amount outstanding today, measured in UDIs, is below that of what was expected to be paid on the amortization schedule. The transaction also provides for a 12-month debt service reserve fund, which is fully funded in cash. The Certificates were issued in December 2005 through a special purpose trust through HSBC Mexico, S.A., Institución de Banca Múltiple, Grupo Financiero HSBC, División Fiduciaria, and are secured by the toll collection rights embodied in the concession agreement between Desarrolladora de Concesiones Omega S.A. de C.V. and the Secretary of Transportation and Communications. Libramiento Matehuala is a 14-kilometer long toll road that was built as an alternative/bypass parallel to Boulevard Matehuala, which bisects the city of Matehuala, located in central Mexico in the state of San Luis Potosi. Although short relative to most toll roads, the Libramiento de Matehuala is an integral component of Federal Highway 57, which connects Mexico City with Laredo, Texas and beyond. The Laredo port of entry handles approximately 44% and 35% of all U.S./Mexico exports and imports, respectively. Desarrolladora de Concesiones Omega, S.A. de C.V. was established in 2003 solely to construct, own and operate the Libramiento Carretera Matehuala for a period of 30 years to 2033. The concessionaire is 98% owned by Omega Corp, S.A. de C.V. Moody's Mexico National Scale ratings are opinions of the relative credit worthiness of issuers and issues within Mexico. The Moody's Global Scale rating for borrowings in local currency allows investors to compare the state's creditworthiness to all other issuers in the world rather than merely in Mexico. It incorporates all Mexico-related risks, including the potential volatility of the Mexican economy. For comparative purposes, Moody's Global Scale, Local Currency rating for domestic debt issued by the Mexican government is Baa1. * MEXICO: Peso & Bond Drop on Concern U.S. Demand to Decline ------------------------------------------------------------ Mexico's peso and bonds fell on concern growing job losses in the U.S. will further erode demand for Mexican exports, Valerie Rota of Bloomberg News reports. According to the report, the peso's decline extended its loss this month to 2.8%, the worst performance against the dollar among the six most-traded currencies in Latin America. "There hasn't been a correction in risk perception," Bloomberg quoted Eduardo Perez, who oversees US$5 billion in assets at Grupo Nacional Provincial SA in Mexico City, as saying. "There are still a lot of elements of uncertainty," he said. Bloomberg News notes Alfredo Thorne, JPMorgan Chase & Co.'s head of Latin America research, said Mexico's economy will contract 1.6% this year. The report relates Alonso Cervera, a Latin America economist at Credit Suisse Group, said Mexico's current-account deficit will likely swell to 4% of gross domestic product in 2009, from 2 percent of GDP last year. Meanwhile, Bloomberg News says yields on Mexico's benchmark government bonds rose for a second day on January 26, after reaching a nine-month low. The yield has fallen 3.73 percentage points from a 3 1/2-year high in November, the report recounts. The report adds Manuel Galvan, a fixed-income strategist at Metanalisis SA, said the yield on the security due in 2024 may fall another half-percentage point over the coming weeks on bets the decelerating economy will slow inflation this year. ======================================== T U R K S & C A I C O S I S L A N D S ======================================== TCI NEW MEDIA: To Close Down by Months End ------------------------------------------ Government television station channel 7, TCI New Media, will be closing down soon, possibly by the end of January due to lack of funding, Turks and Caicos Net News reports, citing unnamed sources. According to the report, TCI New Media was started under the current administration as an outlet for government-related news. However, the report relates no license was issued and it operated illegally for some months. The People's Democratic Movement (PDM) opposition brought this issue to the House of Assembly last year and the Michael Misick- led government established a broadcast commission to legalize the station, the report recounts. The report says that during the debate on this issue, the ruling Progressive National Party (PNP) was allotted the lion's share of the broadcast time and the opposition a minimum. During the House meeting, Turks and Caicos Net News relates, the opposition put forth the proposition that most of the time the New Media broadcasts were nothing more than propaganda and therefore they were entitled to equal time. ================= V E N E Z U E L A ================= * VENEZUELA: OPEC is Ready for More Cuts, President Chavez Says --------------------------------------------------------------- The Organization of Petroleum Exporting Countries ("OPEC") is ready to cut more crude production to defend world oil prices hurt by the global financial crisis, Patricia Rondon of Reuters reports, citing Venezuelan President Hugo Chavez. Last month, the report recounts, OPEC agreed to slash its output by 2.2 million barrels per day after crude prices fell more than US$100 from highs in July after economic turmoil battered demand. "I said a few weeks ago, if we have to cut 4 million more, we will cut them, we are not going to let the prices fall again to where they were ten years ago, at US$6 a barrel," Reuters quoted President Chavez as saying. As reported in the Troubled Company Reporter - Latin America on January 9, 2009, the Ministry of the People's Power for Energy and Petroleum of Venezuela executed a 189,000 barrels-per-day oil production cut, following OPEC's 151st (Extraordinary) Conference. The TCRLA related the production cut of 189,000 b/d, effective from January 1, 2009, added to the reductions of 46,000 b/d and 129,000 b/d, implemented by PDVSA, according to the OPEC decisions, determined during the meetings of September and October of 2008, for a total general reduction of 364,000 b/d, that place the current Venezuelan production on 3 millions 11 thousand * * * According to Moody's Rating Agency, Venezuela continues to carry a B2 foreign currency rating and a B1 local currency rating with stable outlook. ============= X X X X X X X ============= * CARIBBEAN ISLANDS: Local Resort Adds to Island Job Cuts --------------------------------------------------------- The Westin and Sheraton Grand Bahama Our Lucaya Resort is adding to the job loss woes across the Caribbean, with 181 of its beachfront employees, or 18% of its workforce, has been let go, CaribWorld News reports. The report relates hotel officials of the New York-based Starwood Hotels & Resorts Worldwide Inc. said the U.S. recession continues to keep travelers put. According to the report, the latest job losses add to those by other big named hotels across the island and the region: -- Atlantis Resort with about 800 dismissed workers; -- Baha Mar Resorts Ltd. with some 80 laid off employees at two Bahamas locations; -- Sandals with 650 job cut in December; and -- Wyndham Rio Mar Beach Resort and Spa with 200 slashed jobs. The job cuts, CaribWorld News relates, are not limited to tourism: -- Wyeth Pharmaceuticals cut 276 in Puerto Rico; -- Sugar Company of Jamaica sent 8,000 workers home; and -- Rusal of Jamaica cut 150 jobs and another 600 in Guyana. Other companies in the Caribbean, the report notes, are also planning to have job cuts: -- Hewlett-Packard Co. will cut nearly 100 workers in Puerto Rico by the end of April; -- Digicel to cut 10% of its Caribbean workforce; and -- LIME will cut 1,200 jobs. CaribWorld News says the UN has forecast that the Caribbean economy is set to see a rise in unemployment rates this year to between 7.8% and 8.1% as a result of the international crisis. *********** Monday's edition of the TCR-LA delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR-LA editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR-LA constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR-LA editor holds some position in the issuers' public debt and equity securities about which we report. Tuesday's edition of the TCR-LA features a list of companies with insolvent balance sheets obtained by our editors based on the latest balance sheets publicly available a day prior to publication. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. A list of Meetings, Conferences and Seminars appears in each Thursday's edition of the TCR-LA. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com *********** 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. Marie Therese V. Profetana, Marites O. Claro, Joy A. Agravente, Pius Xerxes V. Tovilla, Rousel Elaine C. Tumanda, Valerie C. Udtuhan, Frauline S. Abangan, and Peter A. Chapman, Editors. Copyright 2008. 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 * * *