/raid1/www/Hosts/bankrupt/TCRLA_Public/101028.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, October 28, 2010, Vol. 11, No. 213
Headlines
A R G E N T I N A
ALL BUSINESS: Creditors' Proofs of Debt Due February 2
ANGELINI SAIC: Creditors' Proofs of Debt Due November 1
ARCOR SAIC: Moody's Assigns 'B1' Rating to US$200 Mil. Notes
ASCENSORES MASANTU: Creditors' Proofs of Debt Due November 25
BANCO SUPERVIELLE: Moody's Assigns Low-B Ratings to Debt Program
CANTUA SRL: Creditors' Proofs of Debt Due November 26
EVENTUAL SERVICE: Creditors' Proofs of Debt Due December 9
FIDEICOMISO FINANCIERO: Moody's Assigns 'B3' Rating to Securities
GYSI SA: Creditors' Proofs of Debt Due December 1
H & M MADERAS: Creditors' Proofs of Debt Due December 1
LA CABATA: Creditors' Proofs of Debt Due November 18
SERSILIVAN SRL: Requests for Own Bankruptcy
TERRANED SRL: Creditors' Proofs of Debt Due December 2
B R A Z I L
BANCO DAYCOVAL: Fitch Affirms Issuer Default Rating at 'BB'
COSAN SA: Moody's Upgrades Corporate Family Rating to 'Ba2'
GENERAL SHOPPING: Moody's Assigns 'Ba3' Rating to Senior Notes
GENERAL SHOPPING: Fitch Assigns 'BB-' Issuer Default Rating
C A Y M A N I S L A N D S
BLUEMOUNTAIN CORPORATE: Shareholders' Meeting Set for Nov. 12
BRAINPOOL FINANCE: Shareholders' Final Meeting Set for November 17
CLASSIC II: Shareholders' Final Meeting Set for November 16
DEPWADE LIMITED: Shareholders' Final Meeting Set for November 16
FIDELIO INC: Shareholders' Final Meeting Set for November 17
GALTERE AGRICULTURE: Shareholders' Final Meeting Set for Nov. 17
GALTERE AGRICULTURE: Shareholders' Final Meeting Set for Nov. 17
IMCOPA INTERNATIONAL: Completes Noteholder Consent Solicitation
LATTICE PORTFOLIO: Shareholders' Final Meeting Set for Nov. 8
NEWSMITH GLOBAL: Shareholders' Final Meeting Set for November 16
OLDLAND LANE: Shareholders' Final Meeting Set for November 10
PEQUOT GLOBAL: Shareholders' Final Meeting Set for November 12
PEQUOT GLOBAL: Shareholders' Final Meeting Set for November 12
PEQUOT MARKET: Shareholders' Final Meeting Set for November 12
PEQUOT NEW: Shareholders' Final Meeting Set for November 12
REMO FINANCE: Shareholders' Final Meeting Set for November 17
SOUTHAM LANE: Shareholders' Final Meeting Set for November 10
ST DRIVE: Shareholders' Final Meeting Set for November 17
VALENCE TECHNOLOGY: Shareholders' Final Meeting Set for Nov. 18
VM FINANCE: Shareholders' Final Meeting Set for November 17
D O M I N I C A N R E P U B L I C
* DOMINICAN REPUBLIC: IMF Approves US$779 Million for Country
J A M A I C A
NATIONAL COMMERCIAL BANK: Former Executive to Go on Trial
M E X I C O
MAQUINARIA ESPECIALIZADA: Fitch Puts 'BB-sf' Rating on Notes
VITRO SAB: Ad Hoc Committee Rejects Initial Consent Solicitation
T R I N I D A D & T O B A G O
CL FIN'L: CLICO Policyholders Reject 20-Year IOU
X X X X X X X X
* Upcoming Meetings, Conferences and Seminars
- - - - -
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A R G E N T I N A
=================
ALL BUSINESS: Creditors' Proofs of Debt Due February 2
------------------------------------------------------
The court-appointed trustee for All Business Solution Argentina
S.R.L.'s bankruptcy proceedings will be verifying creditors'
proofs of claim until February 2, 2011.
The trustee will present the validated claims in court as
individual reports on March 16, 2011. 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.
Inadmissible claims may be subject to appeal in a separate
proceeding known as an appeal for reversal.
A general report that contains an audit of the company's
accounting and banking records will be submitted in court on
May 12, 2011.
ANGELINI SAIC: Creditors' Proofs of Debt Due November 1
-------------------------------------------------------
The court-appointed trustee for Angelini S.A.I.C.'s bankruptcy
proceedings will be verifying creditors' proofs of claim until
November 1, 2010.
ARCOR SAIC: Moody's Assigns 'B1' Rating to US$200 Mil. Notes
------------------------------------------------------------
Moody's Latin America has assigned a first-time B1 foreign
currency rating and an Aa2.ar Argentina National Scale Rating to
Arcor S.A.I.C. proposed new US$200 million senior unsecured notes
due in 2017. At the same time, Moody's assigned a Ba2 global
local currency corporate family rating to Arcor. The US$200
million senior unsecured notes are subject to Argentina's B2
foreign currency country ceiling. The outlook for all ratings is
stable.
Rating Rationale
Arcor's proposed US$200 million senior unsecured notes, which are
payable in US dollars, are subject to Argentina's foreign currency
convertibility and transfer risk, reflected in the B2 foreign
currency country ceiling. The B1 notes' rating reflects the
piercing of the ceiling by one notch due to these factors: i) the
availability of a liquidity cushion account in the US covering
almost half of the total debt outstanding, ii) The company's
sizeable international business which currently generates over a
billion dollars in annual revenues approx., iii) the Bonex clause,
a mechanism available to purchase foreign currency denominated
bonds in Argentina to be sold offshore, in order to make payments
to investors in foreign currency and iv) the relative good
performance of similar transactions during 2001-2002's
transferability and convertibility restrictions imposed by the
Argentine Central Bank.
"Arcor's ratings are supported by its global market presence,
leading category market position, and its broadly diversified
portfolio of branded packaged food products-strengths that were
enhanced by the addition of the operating plants in Brazil, Chile
and Mexico, which give them access to fast-growing developing
markets. The ratings also reflect Arcor's leadership positions in
confectionery and the diversification of the company's product
offering across chocolate, chewing gum, cookies and candy" said
Moody's AVP Analyst, Veronica Amendola. The ratings are also
supported by the limited product volatility as majority of
revenues comes from fairly stable food business and the attractive
expansion opportunities that the company has in their
international business. "Additionally, the ratings reflect
Arcor's strong credit metrics, strong asset coverage, adequate
liquidity profile and low adjusted debt leverage" continues
Amendola. Finally, the rating consider Moody's expectation that
Arcor will generate sufficient cash flow from operations to
maintain its credit metrics profile, including a strong liquidity
position due to the company's relatively prudent financial
strategies.
These credit strengths are offset by the company's country risk
exposure to Argentina as the first largest market, with
concentration of cash flows from that country. Nonetheless, the
exposure should diminish over time as geographic diversification
improves with growth outside of the country (i.e., in Chile,
Mexico, Brazil, and Peru). Moody's notes that international
business still needs to achieve critical mass to become a
meaningful contributor to EBITDA. In addition, constraining the
ratings is the highly competitive environment that Arcor faces
from local and international players with significant financial
resources to develop the food market.
While Arcor's cash flow contributions are driven mainly from
Argentina, the Ba2 rating is underpinned by Moody's expectations
that the company will continue to build scale and brand
recognition in its offshore markets, leading to a geographic mix
that will increasingly migrate towards international. Moody's
acknowledges that Arcor has proven solid execution ability through
its well established distribution network, manufacturing
customized products for the local consumer under well-known
brands. Furthermore, Arcor is vertically integrated in Argentina,
involved in the entire process from procuring the basic raw
materials through the production and commercialization of products
and final packaging.
Arcor's Ba2 local currency rating reflects its global default and
loss expectation, while the Aa2.ar national scale rating reflects
the standing of Arcor's credit quality relative to its domestic
peers. Moody's National Scale Ratings are intended as relative
measures of creditworthiness among debt issues and issuers within
a country, enabling market participants to better differentiate
relative risks. NSRs in Argentina are designated by the ".ar"
suffix. Issuers or issues rated Aa2.ar present above-average
creditworthiness relative to other domestic issuers. NSRs differ
from global scale ratings in that they are not globally comparable
to the full universe of Moody's rated entities, but only with
other rated entities within the same country
The rating outlook reflects Moody's expectation that Arcor will
continue to successfully implement its business model in the
international markets, reducing its exposure to the Argentinean
market. The stable outlook also reflects Moody's expectation that
Arcor will be able to increase revenues and earnings over the near
term based on its operating plants' efficiency and commercial
initiatives thus allowing the company to preserve adequate access
to external financing sources to meet its short-term debt
obligations while maintaining adequate levels of cash generation
in relation to debt.
Rating could experience upward pressure if Arcor accomplishes
solid operating performance over the medium term and continue
strengthening its international revenues leading to increasing
operating margins and modest financial leverage. In addition,
stronger operating margins because of an adequate performance and
improved credit metrics with Adjusted Debt/EBITDA falling well
below 1.5 times on a sustainable basis (vs. 1.7 times as of LTM
2Q10) under current business configuration could put positive
pressure on ratings. Finally, Arcor's notes ratings would be
upgraded if Argentina's B2 foreign currency country ceiling is
upgraded.
Downward pressure on ratings could occur if Arcor's credit metrics
deteriorate because of lagging performance in key markets (e.g.
driven by an aggressive financial policy that could jeopardize
liquidity), such that adjusted Debt/EBITDA rises above 3 times
over a prolonged period under the company's current business
configuration. If growth investments are more aggressive than
anticipated and lead to overexpansion (i.e., investments are not
matched by near term earnings growth) could also impact ratings.
Reducing US$cash position abroad to below US$100 millions on a
sustainable basis and\or lack of meaningful contribution to the
development of the international business, could also put pressure
on the notes ratings. Finally, the notes ratings would also be
downgraded if Argentina's B2 foreign currency country ceiling is
downgraded.
Arcor SAIC, Cordoba, Argentina, is one of the largest
confectionary, cookies and food companies in the country with over
US$2.3 billion in sales as of the last twelve months ended June
2010. Arcor's well-known brands include: Butter Toffees, Bon o
Bon, Cofler, Rocklets, Menthoplus, La Campagnola, Poosh, Topline,
Bigtime, Mr. Pop's, Mogul and Sapito
Regulatory Disclosures
Information sources used to prepare the credit rating are these:
parties involved in the ratings, parties not involved in the
ratings, public information, confidential and proprietary Moody's
Investors Service's information, confidential and proprietary
Moody's Analytics' information.
Moody's Investors Service considers the quality of information
available on the issuer or obligation satisfactory for the
purposes of assigning a credit rating.
MOODY'S adopts all necessary measures so that the information it
uses in assigning a credit rating is of sufficient quality and
from sources MOODY'S considers to be reliable including, when
appropriate, independent third-party sources. However, MOODY'S is
not an auditor and cannot in every instance independently verify
or validate information received in the rating process.
ASCENSORES MASANTU: Creditors' Proofs of Debt Due November 25
-------------------------------------------------------------
The court-appointed trustee for Ascensores Masantu Gilio S.R.L.'s
bankruptcy proceedings will be verifying creditors' proofs of
claim until November 25, 2010.
The trustee will present the validated claims in court as
individual reports on February 7, 2011. 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.
Inadmissible claims may be subject to appeal in a separate
proceeding known as an appeal for reversal.
A general report that contains an audit of the company's
accounting and banking records will be submitted in court on
March 21, 2011.
BANCO SUPERVIELLE: Moody's Assigns Low-B Ratings to Debt Program
----------------------------------------------------------------
Moody's Latin America assigned Aa2.ar and a Aa3.ar national scale
local and foreign currency debt ratings to Banco Supervielle's
global debt program in the amount of US$200 million. The program
allows for multicurrency debt issuances of both senior and
subordinated debt. In addition, a national scale foreign currency
debt rating of Aa3.ar was assigned to the expected first issuance
of subordinated notes under the program, amounting to US$50
million. Moody's indicated that the issuance will be governed by
the law of the State of New York.
At the same time, Moody's Investors Service assigned Ba3 and B2
global local and foreign currency debt ratings to the program.
Moody's also assigned a B2 global foreign currency subordinated
debt rating to the aforementioned expected first issuance.
The outlook on all ratings is stable.
These ratings were assigned to Banco Supervielle S.A.:
US$200 million (or its equivalent in other currencies) senior debt
program:
-- Ba3 Global Local Currency Debt Rating, with stable outlook
-- B2 Global Foreign Currency Debt Rating, with stable outlook
-- Aa2.ar Argentina National Scale Local Currency Debt Rating
-- Aa3.ar Argentina National Scale Foreign Currency Debt Rating
First Issuance of US$50 million:
-- B2 Global Foreign Currency Subordinated Debt Rating, with
stable outlook
-- Aa3.ar Argentina National Scale Foreign Currency Subordinated
Debt Rating
Ratings Rationale
Moody's noted that subordination was taken into consideration in
the assignment of the rating for the first issuance. Subordinated
debt is usually rated one notch below the global local currency
senior rating (i.e. Ba3 for Supervielle). The rating agency also
noted that the global foreign currency debt rating is capped by
Moody's B2 Argentinean country ceiling for foreign currency debt.
Banco Supervielle S.A. is headquartered in Buenos Aires, and it
had assets of Ar$ 5.1 billion and total loans of Ar$ 3.1 billion,
as of June 2010.
Regulatory Disclosures
Information sources used to prepare the credit rating are the
following: parties involved in the ratings, parties not involved
in the ratings, public information, confidential and proprietary
Moody's Investors Service information.
Moody's Investors Service considers the quality of information
available on the issuer or obligation satisfactory for the
purposes of assigning a credit rating.
CANTUA SRL: Creditors' Proofs of Debt Due November 26
-----------------------------------------------------
Andres Angel Landro, the court-appointed trustee for Cantua SRL's
reorganization proceedings, will be verifying creditors' proofs of
claim until November 26, 2010.
Mr. Landro 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. 15, 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.
Creditors will vote to ratify the completed settlement plan
during the assembly on October 5, 2011.
The Trustee can be reached at:
Andres Angel Landro
Espinosa 1474
Argentina
EVENTUAL SERVICE: Creditors' Proofs of Debt Due December 9
----------------------------------------------------------
Viviana Monica Palopoli, the court-appointed trustee for Eventual
Service SA's bankruptcy proceedings, will be verifying creditors'
proofs of claim until December 9, 2010.
Ms. Palopoli will present the validated claims in court as
individual reports. The National Commercial Court of First
Instance No. 18 in Buenos Aires, with the assistance of Clerk
No. 35, 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.
The Trustee can be reached at:
Viviana Monica Palopoli
avenida Cordoba 859
Argentina
FIDEICOMISO FINANCIERO: Moody's Assigns 'B3' Rating to Securities
-----------------------------------------------------------------
Moody's Latin America has assigned a rating of A2.ar (sf)
(Argentine National Scale) and of B3 (sf) (Global Scale, Local
Currency) to the VRD (securities) of Fideicomiso Financiero
Programa Federal Plurianual de Construcci¢n de Viviendas -
Provincia del Chaco -- Serie I (as the trust) issued by Instituto
Provincial de Desarrollo Urbano y Vivienda de la Provincia del
Chaco, acting as seller to the transaction. The VRD will be an
obligation of the trust.
Rating Rationale
The debt securities will bear a floating interest rate (BADLAR
Public) plus 200 basis points. Interest and principal will be
paid on a quarterly basis, the 10th business day of January,
April, July and October, beginning on October 12, 2012. Accrued
interest from closing date to June 30, 2012 will be capitalized on
a quarterly basis. The legal final of the transaction is July 28,
2025.
Instituto Provincial de Desarrollo Urbano y Vivienda de la
Provincia del Chaco, an autarchic entity of Province of Chaco,
assigned without recourse to the trust the collections derived
from loans to purchase low income houses, existing and to be
built, in the Province of Chaco, Argentina. Issuance proceeds
will be used to build 3,500 low-income houses in the Province of
Chaco. The Province of Chaco is rated A3.ar (National Scale
Rating) and B3 (Global Scale, Local Currency).
The transaction also benefits from a guaranty trust, which will
receive the transfers from the National Housing Fund (FONAVI -
Fondo Nacional de la Vivienda) corresponding to IPDUV Chaco.
According to National Law 24,464 and Provincial Law 4,368, IPDUV
Chaco is entitled to receive 4.6% of FONAVI collections. This
cash flow can be used as a secondary source of repayment in case
collections on the IPDUV loans are not sufficient to cover debt
service. Moody's did not provide significant credit to the
primary cashflow of the transaction; therefore the ratings are
mainly based on the FONAVI cashflows flowing through the guaranty
trust.
The assignment of the FONAVI cash flow to the guaranty trust will
be formalized through public deed. In addition, the trustee will
notify the assignment to: (i) the National Ministry of Economy and
Public Finances, (ii) the National Ministry of Federal Planning,
Public Investment and Services, and (iii) Banco Hipotecario.
The FONAVI cashflow will be deposited automatically into the trust
account of the guaranty trust, and will remain in that account for
24 hours, to be then transferred to IPDUV Chaco, unless instructed
otherwise by the trustee. The FONAVI cashflow will be available
to pay debt service, if the collections on the IPDUV loans are
insufficient.
Moody's considered the risk that the IPDUV Chaco (or the Province
of Chaco) may attempt to interfere with the assignment of the
FONAVI cash flow to the guaranty trust. Moody's notes that there
are negative precedents in Argentina in transactions involving
pledges of another federal transfer, federal coparticipation
taxes. In these cases, certain provinces have successfully
claimed in court that the pledge of federal coparticipation taxes
should not be respected in times of economic emergency emergency
of the province assigning the flows. However, according to
Moody's there are no similar negative precedents in transactions
backed by pledged FONAVI flows. Unlike federal coparticipation
taxes, funds from FONAVI are earmarked and can only be used for
social housing. Therefore, it is less likely that the province
could successfully claim in court that the pledge of FONAVI funds
should not be respected and that the funds be used for general
purposes during a scenario of economic distress. The documents of
the transaction indicate that in case of interference with the
FONAVI flows or the IPDUV loans, investors will have a claim
against the IPDUV and/or the Province.
Moody's believes that the likelihood that the province would
attempt to interfere with the assignment of FONAVI funds is
correlated with the credit risk of the Province of Chaco, which is
rated A3.ar (National Scale Rating) and B3 (Global Scale, Local
Currency). Therefore, if the rating of the Province is
downgraded, the rating of the VRD will likely be downgraded.
FONAVI is funded primarily by a percentage (33.18%) of the
collection on the fuel taxes. A modification of the regulatory
framework of FONAVI or a failure of the Argentine National
Government to transfer these funds to the Province of Chaco could
affect the FONAVI flows, which are critical for the repayment of
the VRD.
Moody's analyzed the cash flow coverage levels considering both
the flows from IPDUV loans and from FONAVI.
Moody's developed a cash flow model that takes into account the
most relevant features of the transaction's assets and
liabilities. Monte Carlo simulations were run, which determine
the expected loss for the rated securities.
In assigning the rating to this transaction, Moody's assumed a
certain haircut for the expected cashflow coming from the IPDUV
loans, based on triangular distributions. For existing houses,
Moody's assumed a haircut with a minimum of 30%, most likely of
65% and maximum of 100%. For new houses financed by this
issuance, Moody's assumed a haircut with a minimum of 50%, most
likely of 75% and maximum of 100%. Finally, for other future
housing programs, Moody's assumed a haircut with a minimum of 80%,
most likely of 90% and maximum of 100%.
Also, Moody's assumed an Inverse Gaussian distribution for the
interest rate with a mean of 10.65% and delta of 7.01%. These
assumptions were derived from the historical performance of the
collateral and the reference interest rate. Moody's notes that
the interest rate on the VRD is variable based on the Badlar rate,
without a cap or a floor.
Finally, Moody's assumed an initial value for FONAVI's annual
collections of ARS 70 million. To forecast future performance,
the annual growth rate was modeled using a triangular distribution
with a minimum -5% annual increase, a most likely of 0% and a
maximum of 5%.
After running the Monte Carlo simulations, the expected loss of
the rated securities was consistent with a B3 (sf) rating.
The main uncertainties in this transaction are the collection
levels of the IPDUV loans, and also the volatility of the
reference interest rate.
This debt issuance by Fideicomiso Financiero Programa Federal
Plurianual de Construcci¢n de Viviendas - Provincia del Chaco --
Serie I is the first issuance that Moody's has rated in this
sector.
Moody's did not receive or take into account a third party due
diligence report on the underlying assets or financial instruments
in this transaction.
Regulatory Disclosures
Information sources used to prepare the credit rating are these:
parties involved in the ratings and public information.
Moody's considers the quality of the information available on the
issuer or obligation satisfactory for the purposes of assigning a
credit rating.
MOODY'S adopts all necessary measures so that the information it
uses in assigning a credit rating is of sufficient quality and
from sources MOODY'S considers to be reliable including, when
appropriate, independent third-party sources. However, MOODY'S is
not an auditor and cannot in every instance independently verify
or validate information received in the rating process.
GYSI SA: Creditors' Proofs of Debt Due December 1
-------------------------------------------------
Raul Horacio Trejo, the court-appointed trustee for Gysi S.A.'s
bankruptcy proceedings, will be verifying creditors' proofs of
claim until December 1, 2010.
Mr. Trejo will present the validated claims in court as individual
reports. The National Commercial Court of First Instance No. 4 in
Buenos Aires, with the assistance of Clerk No. 7, 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.
The Trustee can be reached at:
Raul Horacio Trejo
avenida Corrientes 818
Argentina
H & M MADERAS: Creditors' Proofs of Debt Due December 1
-------------------------------------------------------
Miguel Angel Troisi, the court-appointed trustee for H & M Maderas
Logistica SRL's bankruptcy proceedings, will be verifying
creditors' proofs of claim until December 1, 2010.
Mr. Troisi will present the validated claims in court as
individual reports. The National Commercial Court of First
Instance No. 12 in Buenos Aires, with the assistance of Clerk
No. 24, 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.
The Trustee can be reached at:
Miguel Angel Troisi
Cerrito 146
Argentina
LA CABATA: Creditors' Proofs of Debt Due November 18
----------------------------------------------------
The court-appointed trustee for La Cabata de Buenos Aires S.A.'s
reorganization proceedings, will be verifying creditors' proofs of
claim until November 18, 2010.
The trustee will present the validated claims in court as
individual reports on February 2, 2011. 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.
Inadmissible claims may be subject to appeal in a separate
proceeding known as an appeal for reversal.
A general report that contains an audit of the company's
accounting and banking records will be submitted in court on
March 16, 2011.
Creditors will vote to ratify the completed settlement plan
during the assembly on August 15, 2011.
SERSILIVAN SRL: Requests for Own Bankruptcy
-------------------------------------------
Sersilivan SRL requested for own bankruptcy.
The company stopped making payments last October 9, 2009.
TERRANED SRL: Creditors' Proofs of Debt Due December 2
------------------------------------------------------
Maria Cristina Lucena, the court-appointed trustee for Terraned
SRL's bankruptcy proceedings, will be verifying creditors' proofs
of claim until December 2, 2010.
Ms. Lucena will present the validated claims in court as
individual reports. The National Commercial Court of First
Instance No. 11 in Buenos Aires, with the assistance of Clerk
No. 22, 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.
The Trustee can be reached at:
Maria Cristina Lucena
Lavalle 1718
Argentina
===========
B R A Z I L
===========
BANCO DAYCOVAL: Fitch Affirms Issuer Default Rating at 'BB'
-----------------------------------------------------------
Fitch Ratings has affirmed the long-term foreign and local
currency Issuer Default Ratings and outstanding debt ratings of
Banco Daycoval S.A.'s:
-- Long-term foreign currency IDR at 'BB';
-- Long-term local currency IDR at 'BB';
-- Short-term foreign currency IDR at 'B';
-- Short-term local currency IDR at 'B';
-- US$300 million senior notes at 'BB'
-- Individual at 'C/D';
-- Support at '5';
-- Support Floor 'No Floor';
-- National Long-term Rating 'A+(bra)';
-- National Short-term Rating 'F1(bra)'.
The Rating Outlook is Stable. The Rating on Daycoval's senior
note issuance ranks pari passu with Daycoval IDRs and other senior
unsecured debts.
The IDRs and National ratings of Banco Daycoval S.A. reflect a
consistent track record for profitability, making it well-
positioned regionally; its strong capitalization, which is better
than its peers; and prudent management of liquidity, maintaining
high cash even in stressful times. Conversely, the ratings also
factor in Daycoval's medium size, its consequent asset and
liability concentrations, and the challenge of finding more
diversified funding channels and revenue sources.
Diversified funding and revenue sources, coupled with adequate
earnings and leveraging, would enable an upgrade in Daycoval's
rating. On the other hand, a continued deterioration in asset
quality that results in pressures on earnings and capital may
negatively affect Daycoval's ratings.
Like its peers, Daycoval was affected by the global financial
crisis after September 2008. Deposits and earnings declined, with
a strong increase in delinquency at the end of 2008 and into 2009.
To mitigate these problems, the bank adopted a prudent posture to
reduce lending and focus on liquidity, which remained high during
the global crisis (over 50% of deposits). With the recovery of
growth of the Brazilian economy, the bank has gradually increased
its portfolio - concentrating on the middle market where it has
strong experience - as well as payroll deductible loans. However,
Daycoval maintained its auto and retailer financing activities.
Although volumes are still low, Fitch considers Daycoval's
relatively greater diversification positive and expects that their
contribution to profitability will increase going forward.
Profitability remained satisfactory even during the global crisis
and improved with the reduction in delinquency in 2010,
accompanying its peer average despite lower leveraging, thanks to
greater efficiency and spreads. Fitch believes that the bank will
return to its historical profitability (close to 20%) provided
that it maintains delinquency under control, with greater, but
still moderate, leveraging. Loan quality ratios improved to be
virtually in line with its peer average in June 2010. This is
expected to continue, accompanying the lower delinquency in the
market.
Initiating operations in 1968, Daycoval is controlled by the Dayan
family. Since 2007, its shares have been traded on the Sao Paulo
Stock, Commodities, and Futures Exchange (BM&FBovespa).
COSAN SA: Moody's Upgrades Corporate Family Rating to 'Ba2'
-----------------------------------------------------------
Moody's Investors Service upgraded Cosan S.A. Industria e Comercio
S.A.'s corporate family rating to Ba2 from Ba3. Also impacted by
Moody's rating action are Cosan Finance Limited's $400 million 7%
senior unsecured notes due 2017 and Cosan S.A.'s $450 million
senior unsecured perpetual notes which were both similarly
upgraded to Ba2 from Ba3. This action completes the review
process for a potential upgrade which Moody's commenced on March
1, 2010 after Cosan and Shell International Petroleum Company
Limited announced their intention to create a $12 billion joint
venture to produce and commercialize ethanol and power from sugar
cane and distribute a variety of industrial and transportation
fuels through a combined distribution and retail network in
Brazil.
At the same time Moody's assigned a Ba2 rating to Cosan Overseas
Limited's proposed $300 million senior unsecured perpetual notes
issuance, which initially will be unconditionally guaranteed by
Cosan and by CCL upon the completion of the proposed joint venture
with Shell. The outlook for the CFR and the proposed note
offering is stable.
However, Moody's are assigning a positive outlook on the company's
existing 2017 senior unsecured and existing perpetual notes (both
securities will be contributed to the Joint Venture).
Ratings Rationale
The upgrade, which is predicated on Moody's view that the Joint
Venture will be consummated on basically the terms and within the
time frame that has been communicated by the company, reflects the
anticipated improvement in the credit and business profile of
Cosan upon closing of the transaction. In Moody's analysis
Moody's have considered the anticipated strong credit profile of
the Joint Venture albeit offset in part by the lack of full
ownership and control of the Joint Venture by Cosan.
Specifically, the Joint Venture is expected to enhance Cosan's
credit profile in three ways. First, based on the expected
dividend stream from the Joint Venture, Moody's believe that
Cosan's cash flow will demonstrate less volatility given the more
stable characteristics of the fuel distribution business to be
contributed by Shell. Second, Cosan will gain access to what will
now be Brazil's third largest fuel distributor for its ethanol and
the JV will provide Cosan with a better capitalized vehicle to
take advantage of the attractive yet capital intense sugar ethanol
prospects in the Brazilian market. Third, Cosan will transfer
significant amount of its debt to the JV and likely enjoy lower
leverage post restructuring.
In Moody's analysis Moody's have also taken into consideration the
challenges in running a business where both parties have equal
decision making power, the current lack of clarity with regard to
the Joint Venture's expected synergies, financial performance
objectives, policies and strategic initiatives, the rebranding of
Cosan's existing fuel distribution network, and execution risk.
As part of the joint venture agreement, Cosan and Shell will
create three new legal entities and both parties will contribute
certain assets and liabilities.
A management company, in which both parties will have an equal 50%
economic and voting interest, will be the principal vehicle
through which the partners will run the contemplated venture.
Day-to-day operations will be conducted out of two newly to be
formed operational joint ventures. A Sugar and Ethanol Company
(as the "S&E JV"), in which both parties have an equal economic
interest but which will de facto be controlled by Cosan (who will
have 51% of the voting shares), will run the production of sugar
and ethanol as well as the co-generation activities. A Downstream
Company (as the "Downstream JV"), in which both parties also hold
equal economic interests but which will be controlled by Shell
(having 51% of the voting shares), will conduct the supply,
distribution and sale of the Joint Venture's fuel business.
Cosan will contribute to the Joint Venture principally all of its
sugar and ethanol mills and ethanol logistics assets, all of its
energy co-generation business and fuel distribution and retail
businesses. Additionally, Cosan will contribute an estimated
US$2.5 billion plus BRL 500 million of existing debt and general
working capital liabilities. Shell will contribute its Brazilian
fuel distribution and retail as well as its jet fuel businesses,
its equity stake in two next generation biomass fuel research
ventures as well make an estimated $1.6 billion in cash payments
over a two year time period.
It is contemplated that the cash management for the two operating
joint ventures will be run on a consolidated basis and all
contributed debt plus that the debt to be issued will benefit from
cross guarantees between the two joint ventures. While Moody's
does not rate the Joint Venture, Moody's believe that based on the
available information the credit quality is likely to be higher
than that of Cosan on a standalone basis following completion of
the Joint Venture.
Under the terms of the joint venture, Shell will have the option
at the 10th anniversary to buy 50% or all of Cosan's stake in the
proposed Joint Venture. In addition, at the 15th anniversary,
Shell will have another option to acquire all or the remaining
interest of Cosan in the Joint Venture. If Shell does not
exercise the option, Cosan will have the option to acquire Shell's
stake in the Joint Venture.
While the change of control provision in the proposed note
indenture provides reasonable protection to bondholders if Shell
were to exercise in full its call option to acquire Cosan's
interest in the Joint Venture at its 10th or 15th anniversary,
this is not the case if Shell were to acquire only half of Cosan's
50% stake in the venture at the 10th anniversary. Under the terms
of the indenture, a change of control which results in a ratings
decline will give bondholders the right to put the bonds back to
the issuer or guarantors at 101% plus accrued interest. The
change of control provision is triggered only if Cosan sells all
or substantially all of its assets (which would include its
interest in the Joint Venture) and if Cosan does not use the
proceeds from such a sale to make permitted reinvestments within
360 days of receipt. Permitted reinvestments are defined to
include the permanent repayment of debt (except for subordinated
debt) or certain investments in permitted businesses and
productive assets (as defined in the indenture).
The Joint Venture, which is still subject to regulatory approvals
in Europe and Brazil is scheduled to close on March 31, 2011,
which will coincide with the end of the fiscal year of Cosan.
Upon completion of the joint venture, earnings of the Cosan will
be derived principally from the dividends it will receive from its
equity stake in the S&E and Downstream JVs. Additional
contributions will come from dividends from its 69.7% stake in
Rumo Logistica, its 18.9% stake in Radar as well as all of the
earnings from its remaining lubes business ("CCL Lubricants").
Cosan's guarantee will also benefit from certain land holdings
which will stay with the Company following the completion of the
Joint Venture.
The stable outlook on the company's CFR and the proposed note
offering reflects Moody's expectation that the ratings will not
likely experience upwards pressure over the near term as it will
receive the benefits from the Joint Venture only in an indirect
manner through the payment of future dividends. Additionally,
Cosan will have to share all decision making on an equal basis
with Shell limiting its control over the Joint Venture's strategy
and financial policies.
The positive outlook on Cosan's existing debt securities which are
expected to be contributed to and assumed by the Joint Venture
reflects Moody's view that the Joint Venture is likely to have
better credit fundamentals. As such these existing securities are
likely to experience upwards ratings pressure over time.
Ratings on the existing notes could experience upwards pressure if
the Joint Venture adopts financial policies which would be
commensurate with an investment grade profile while simultaneously
providing consistent dividend payments meaningfully above the
minimum 25% pay-out ratio as currently contemplated, the
expectation of a sustainable improvement in financial leverage and
more stable cash flows.
Ratings could experience downward pressure if the Joint Venture
adopts financial policies which are not commensurate with an
investment grade credit profile, earnings and cash flows do not
demonstrate the expected reduction in volatility, and Cosan adopts
more aggressive financial and or strategic policies then currently
contemplated.
Headquartered in Piracicaba, Brazil, Cosan S.A. Industria e
Comercio is a low-cost Brazilian sugar / ethanol producer. It is
the largest sugar producer in Brazil and the third largest sugar
producer in the world, having sold 4.1 million tons of sugar in
fiscal year 2010. It is also the largest exporter of sugar in the
world.
Regarding its ethanol business, Cosan is the largest ethanol
producer in Brazil and the second largest in the world, having
sold 2.1 billion liters in fiscal year 2010, and the largest
exporter of ethanol in the world. Notably, the group is the
largest grower and processor of sugarcane in the world (twice the
size of the second player), with a crushing capacity expanded of
approximately 62 million tons as of June 30, 2010.
Regulatory Disclosures
Information sources used to prepare the credit rating are these:
parties involved in the ratings, parties not involved in the
ratings, public information, confidential and proprietary Moody's
Investors Service's information.
Moody's Investors Service considers the quality of information
available on the issuer or obligation satisfactory for the
purposes of assigning/maintaining a credit rating.
MOODY'S adopts all necessary measures so that the information it
uses in assigning a credit rating is of sufficient quality and
from sources MOODY'S considers to be reliable including, when
appropriate, independent third-party sources. However, MOODY'S is
not an auditor and cannot in every instance independently verify
or validate information received in the rating process.
GENERAL SHOPPING: Moody's Assigns 'Ba3' Rating to Senior Notes
--------------------------------------------------------------
Moody's Investors Service has assigned a first-time rating of
(P)Ba3 to the proposed senior unsecured notes of General Shopping
Brasil S.A. and a Ba3 corporate family rating (A3.br national
scale corporate family rating). The rating outlook is stable.
These first-time ratings were assigned:
General Shopping Brasil S.A.
-- (P)Ba3 to the proposed senior unsecured notes
-- Ba3/A3.br corporate family rating
Ratings Rationale
General Shopping proposes to issue perpetual non-call five year
senior unsecured notes, under Rules 144A / Reg. S. The notes will
rank pari passu with other unsecured debt. The notes have various
covenants including: limitations on the incurrence of additional
debt, guarantees, and restricted payments. The company will hedge
against foreign exchange risk. The proceeds will be used to
refinance approximately R$100 million in debt as well as fund part
of the company's capital expenditure plan, which includes
developments and expansions.
General Shopping is a leading shopping center company in Brazil
and one of the largest companies in the Brazilian shopping center
industry in terms of total owned and managed GLA. According to
Moody's, General Shopping's Ba3 senior unsecured debt and
corporate family ratings incorporate its experienced and respected
management team and a successful track record of adding value to
its portfolio while being a market leader in operating profitably.
Offsetting these credit positives are the company's aggressive and
opportunistic growth and funding strategy, coupled with its small
size relative to its main competitors." General Shopping's
leading low vacancy rate, which is a result of its focus on class
B and C consumers, coupled with its retail expertise, strong
tenant relationships, tenant diversification and active tenant
sales analysis and database were key to Moody's rating," said
Griselda Bison¢, Analyst of the Commercial Real Estate Finance
Group at Moody's. Additional credit strengths include Brazil's
positive macroeconomic fundamentals, specifically in the B and C
socioeconomic classes where the greatest demand lies, coupled with
a diverse portfolio of good quality properties and established
tenant relationships with a focus on leading retailers. The
company's debt profile is solid and it is expected to remain so.
In addition, as a public company General Shopping must comply with
the standards of corporate governance in the Brazilian stock
market as well as other listing standards set forth by the
Comissao de Valores Mobiliarios, which is the Brazilian equivalent
to the SEC. These strengths, however, are mitigated by the
company's limited track record as a public company relative to its
global peers (IPO in July 2007) as well as high joint venture
exposure, which diminishes transparency. General Shopping also
has aggressive growth plans and a very large development pipeline,
which translates into earnings volatility and funding risk.
Moody's noted that General Shopping's liquidity and funding have
been managed prudently with high use of private and public equity.
However, like most companies in Brazil, General Shopping has no
committed line of credit. It has been able to tap highly reliable
and market competitive debt through BNDES (government owned
development bank). Furthermore, unencumbered assets have been
affected by this debt as it encumbers its largest mall by GLA and
rental revenues. Moody's acknowledges that the issuance of senior
unsecured debt should allow the company to comfortably fund its
growth and development plans and create a free cash cushion.
Additionally, General Shopping's revenues have been stable, based
upon its lease and service revenues. All of its leases have 5%
annual increases. The rents are also adjusted by an inflation
index and include percentage of sales increases. General Shopping
charges four different services fees in most of its malls. It
charges 5% of the retailer's occupancy expense as a management fee
on all of its malls. In all but one mall, the company charges for
parking. The company also manages the distribution and billing of
water and electricity in most of its malls. These have enabled
the company to have consistent healthy EBITDA margins. This
healthy EBITDA margin is somewhat mitigated by net income
volatility and its substantial growth in assets in last three
years.
The stable outlook incorporates Moody's expectation that General
Shopping's credit metrics will continue to improve as the company
grows organically through its current development pipeline, while
at least maintaining its operating margins. The outlook also
incorporates General Shopping's position as a leading shopping
center company in Brazil with a diverse, good quality portfolio
with stable performance. Moody's will monitor the General
Shopping's opportunistic investment and growth strategy and the
funding of its growth strategy.
The company's aggressive growth and funding strategy, coupled with
its lack of track record as a public company are challenges to
ratings improvement in the medium term. However positive ratings
movement could occur through continued successful progress in its
development and growth strategy accompanied by material
improvements in the credit profile: increase in size closer to
US$1 billion in total assets and EBITDA to interest expense closer
at 2X. A downgrade would result from any significant missteps in
its development pipeline or growth plans causing a 10% or more of
reduction in revenues. A material acquisition that is not
financed to reduce leverage in the long term, and or deterioration
in General Shopping's credit profile, which would cause EBITDA to
interest expense to be below current levels of 1.3X and
Debt/EBITDA to be close to 5X will also cause a negative ratings
pressure.
This is the first time Moody's rates General Shopping Brasil S.A.
General Shopping Brasil S.A. is headquartered in Sao Paulo,
Brazil. General Shopping is a leading shopping center company in
Brazil and one of the largest companies in the Brazilian shopping
center industry in terms of total owned and managed GLA. The
company owns 13 shopping centers in which it has a proportional
interest of 84.3%. These shopping centers have an aggregate of:
225.4 thousand square meters of gross leasable area and focuses on
serving the class C and B consumer. At June 30, 2010 General
Shopping reported total assets of approximately R$846 million, and
equity of approximately R$398 million.
Regulatory Disclosures
Information sources used to prepare the credit rating are these:
parties involved in the ratings, public information, confidential
and proprietary Moody's Investors Service's information.
Moody's Investors Service considers the quality of information
available on the issuer or obligation satisfactory for the
purposes of assigning a credit rating.
MOODY'S adopts all necessary measures so that the information it
uses in assigning a credit rating is of sufficient quality and
from sources MOODY'S considers to be reliable including, when
appropriate, independent third-party sources. However, MOODY'S is
not an auditor and cannot in every instance independently verify
or validate information received in the rating process.
GENERAL SHOPPING: Fitch Assigns 'BB-' Issuer Default Rating
-----------------------------------------------------------
Fitch Ratings has assigned these ratings to General Shopping
Brasil S.A.:
-- Foreign currency Issuer Default Rating 'BB-';
-- Local currency IDR 'BB-';
-- National scale ratings 'A-(bra)'.
Fitch Ratings has also assigned a 'BB-' rating to GSB's proposed
perpetual bonds issuance. Fitch has also assigned an IDR of 'BB-'
to General Shopping Finance Limited, a GSB wholly-owned subsidiary
incorporated under the laws of the Cayman Islands. GSF is the
issuer of the proposed perpetual bonds noted above, which are
irrevocably and unconditionally guaranteed by GSB and all of its
operating subsidiaries. The target amount of the proposed
issuance will be around US$150 million; the final amount of the
issuance will depend on market conditions. Proceeds from the
proposed issuance will be used primarily to fund the company's
capex plan, refinance existing debt, and strengthen the company's
liquidity.
The Rating Outlook is Stable.
The ratings reflect GSB's business position as one of the largest
shopping center operators in Brazil's southeastern and southern
regions with participation in 13 shopping centers, stable and
predictable cash flow generation, and positive macro economic
environment. The ratings also incorporate the company's
diversified tenant base, large pool of unencumbered assets, a
comfortable debt payment schedule and low working capital
requirements with leases responsible for most maintenance
expenses.
GSB's current capex plan will be funded primarily with the new
debt issuance of perpetuals; free cash flow is expected to be
negative during the next two years. GSB's rating incorporates the
risk of completion delays and leasing of new developments, as well
as limited geographical and revenue diversification. Leverage
will increase as the company carries out its capex plan.
The Stable Outlook reflects Fitch's expectation that GSB will
continue to deliver positive operating results based on its solid
regional market position and the quality of its assets. GSB is
expected to complete its capex plans, as scheduled during 2011 and
2012, without a further increase in leverage, and that the company
will maintain a solid liquidity going forward.
Strong Business Fundamentals
GSB is expected to continue to benefit from the strong industry
fundamentals as a result of a positive macroeconomic environment
coupled with a limited supply of leasable shopping areas.
Brazil's favorable economic environment during the last few years
has led to an increase in disposable income per capita, which in
turn has led to an increase in retail sales at a higher rate than
Brazil's inflation rate and GDP growth. The Brazilian economy is
forecast to post growth rates of 7% and 4.5% during 2010 and 2011,
respectively. The company's net operating income (NOI) during
2009 and the last 12 months ended in June 2010 was BRL84.3 million
and BRL93.1 million, respectively, and NOI will be around BRL100.3
million in fiscal 2010.
Solid Regional Market Position
GSB is a strong regional player, and its operations are primarily
located in Brazil's southeastern and southern regions. GSB is
particularly well positioned in the Sao Paulo State, an area that
represents approximately 31% and 33% of Brazil's GDP and retail
market, respectively. The company is the market leader in the
city of Sao Paulo with owned gross leasable area of 168,597 square
meters (m2), which represents about 89% of the company's total
owned GLA (190,100 m2).
The company's business position is sustainable in the near to
medium term due to the location of its high quality assets, well-
distributed tenant portfolio, and stable cash-flow generation.
The company is the fifth largest Brazilian shopping center
operator in terms of GLA with 225,399 m2 and 190,100 m2 of total
GLA and owned GLA, respectively, at the end of June 2010. The
company's mall portfolio serves middle-class customers.
Stable And Predictable Results
GSB's stable revenue stream is derived from its lease portfolio
and the sound credit profile of its main tenants. The lease
revenues are predominately fixed in nature and also provide for
the pass-through of ongoing maintenance and operating expenses for
the company's properties, which lowers business risk. The
company's revenues for the fiscal years ending 2008, 2009, and LTM
June 2010 were BRL87 million, BRL101 million; and BRL109 million,
respectively. The company's lease portfolio has an adequate
maturity profile with staggered expirations of 6.6% and 19.2% of
company's rental income expiring in the next 12 and 24 months,
respectively; about of 29.7% of the company's rental income
contracts have expiration dates over the next 24-48 months, and
44.4% of the portfolio expires beyond 48 months.
GSB's revenue structure is mostly based on rentals, which
represent about of 80% total gross revenues, making the company's
revenues very predictable. The other significant component in the
company's revenue structure includes the proceeds from services,
which represent about of 20% of total gross revenues. GSB has low
tenant concentration risk. GSB's 20 largest tenants occupy a
total area of 53 thousand m2, which represents approximately 28%
of GSB's total area and represent approximately 9.7% of the
company's total net revenue. No single tenant represents more
than 1% of total revenue.
Positive Trend In Operating Metrics To Continue
GSB's recent operational performance reflects the high quality of
its portfolio, evidenced by the high level of occupancy, positive
trending revenues per m2 and increasing lease spreads. The
company has consistently reached occupancy levels between 95% and
96% during the last three years. In addition, the company's lease
spreads increased 1% and 3% for existing contracts and 26.2% and
1.8% for new contracts, during the first quarter of 2010 (1Q'10)
and 2Q'10 versus 1Q'09 and 2Q'09, respectively. Same store rent
(SSR) growth continued a positive trend resulting in a minimum
rent increase of 15.6% and 11.2% in the first half of 2010 (1H'10)
and first half of 2009 (1H09), respectively, versus same periods
of the previous year. GSB's tenant consolidated sales volumes
totaled BRL330.3 million and BRL389.7 during 1Q'10 and 2Q'10,
representing increases of 40% and 38% year over year,
respectively.
Aggressive Capex & Negative Free Cash Flow
GSB is currently implementing an aggressive capex plan with
several greenfield and expansion projects, which are expected to
be funded by the new debt. GSB is expected to reach capex levels
of around BRL10 million, BRL178 million, and BRL67.5 million
during 2010, 2011, and 2012, respectively, which will negatively
affect its leverage and free cash flow generation. The company's
capex plan considers the increase in its GLA from current level of
225 thousand m2 to 263 thousand m2 and 310 thousand m2 by the end
of 2011 and 2012, respectively.
The company's greenfield projects are Barueri, Sulacap, and
Outlet, which will add 32 thousand m2, 25 thousand m2, and 12
thousand m2, respectively. Barueri is expected to start
operations during 4Q'11, while Sulacap and Outlet projects are
both expected to start their operations during 2Q'12. In terms of
expansion projects, the company expects to add 6 thousand m2 and
10 thousand m2 with the Unimart and Prudente expansions, which are
expected to be finished during 4Q'11 and 2Q'12, respectively.
The company's net capex for the next two years ended in June 2012
is estimated to be around BRL185 million, as the company has
recently sold a 48% stake in the Barueri project to a private
equity firm while maintaining the management of the shopping
center. The company's free cash flow is expected to be neutral
during 2010 and become negative in 2011 and 2012 by approximately
BRL162.3 million and BRL19.7 million, respectively.
Cash Flow Generation Continues To Grow
GSB's cash flow generation, as measured by Adjusted EBITDA, has
continued to improve during the last several years. The company's
Adjusted EBITDA for LTM period ended June 2010 was BRL79 million,
which positively compares with its Adjusted EBITDA levels of BRL74
million, BRL64 million, and BRL37 million in 2009, 2008 and 2007,
respectively. In addition, the company's Adjusted EBITDA margins
have maintained positive trend, reaching levels of 72%, 74%, 73%,
and 73% during years 2007, 2008, 2009 and LTM June 2010,
respectively. GSB is expected to reach EBITDA levels of
approximately BRL100 million during 2011. The expected
improvement in the company's cash flow generation is highly
dependent on its capacity to execute its capex plan as scheduled.
Delays in the execution of the company's capex could pressure
ratings.
Total Debt To Increase, Net Leverage Stable
GSB will increase its total debt level to fund capex. By the end
of June 2010, the company's total debt was BRL335 million, and it
was BRL322 million and BRL505 million by the end of December 2009
and December 2008, respectively. By the end of June 2010, GSB's
debt was composed of Real Estate Credit Notes (BRL308.7 million)
loans with local banks (BRL26 million). The company does not
maintain any off-balance debt associated with operating leases
obligations.
The company's net leverage, as measured by total net debt/EBITDA,
was 3.9 times by the end of June 2010, which positively compares
to the levels of 4.2x and 6.4x at the end of December 2009 and
December 2008, respectively. The company's net leverage will be
in the 3.6x to 3.9x range during the next 18 months ending in
December 2011, which includes the reduction of approximately
BRL110 million in the company's secured debt and loans to occur
during the 4Q'10.
Liquidity Solid Following Offering
GSB's liquidity has fluctuated in the past, which reflects the
company's negative free cash flow generation during the 2007-2008
period and the low levels of cash flow generation relative to its
capex levels during 2009 and the LTM June 2010. The company is
expected to rebuild its cash position with the proposed
transaction. During 2009 and LTM June 2010, the company's cash
flow from operations reached levels of BRL31 million and BRL51
million, respectively, and capex was BRL31 million and BRL31
million over the same period, resulting in neutral FCF and
slightly positive FCF for 2009 and LTM June 2010.
The company's cash position (BRL26 million) at June 2010
represents 0.6x the company's short-term debt (BRL44 million at
June 2010). GSB liquidity is expected to improve with the
proceeds from the proposed transaction (perpetual bonds). The
ratings incorporate the expectation that the GSB will maintain
solid liquidity of BRL299 million and BRL182 million by the end of
2010 and 2011, respectively.
Manageable Debt Schedule
GSB manageable debt maturity schedule is positive. The company's
financial strategy is to issue perpetual bonds for an outstanding
amount of approximately US$200 million to payoff short-term debt
(BRL110 million approximately), fund its net capital expenditures
of approximately BRL185.5 million during the next 30 months ending
in December 2012, and improve its liquidity. On a pro forma
basis, the company's debt amortization principal payments for 2011
and 2012 would be around BRL9.2 million and BRL12.1 million,
respectively, representing 1.6% and 2.1% of the company's total
debt.
Good Level Of Unencumbered Assets
The company maintains good levels of unencumbered assets; by the
end of June 2010 approximately 60% of the company's owned GLA (123
thousand m2) supports its secured debt of BRL308 million. The
company maintains 67 thousand m2 available and free of any lien
that it could use in the future to access liquidity. In addition,
during the 4Q'10, the company expects to payoff approximately
BRL110 million of its secured debt and loans, increasing its level
of unencumbered assets to approximately 108 thousand m2 or 57% of
its total GLA.
Key rating drivers include the development of the Brazilian
macroeconomic environment in which the company operates, GSB's
operating metrics (vacancy and delinquency rates, property income,
and lease spreads), successful completion of the company's capex
plan, and the company's ability to maintain adequate liquidity.
==========================
C A Y M A N I S L A N D S
==========================
BLUEMOUNTAIN CORPORATE: Shareholders' Meeting Set for Nov. 12
-------------------------------------------------------------
The shareholders of Bluemountain Corporate Loan Fund Ltd. will
hold their final meeting on November 12, 2010, at 10:05 a.m., to
receive the liquidator's report on the company's wind-up
proceedings and property disposal.
The company's liquidator is:
Jess Shakespeare
c/o Maples Finance Limited
PO Box 1093, Boundary Hall
Grand Cayman KY1-1102
Cayman Islands
BRAINPOOL FINANCE: Shareholders' Final Meeting Set for November 17
------------------------------------------------------------------
The shareholders of Brainpool Finance Inc. will hold their final
meeting on November 17, 2010, at 11:00 a.m., to receive the
liquidator's report on the company's wind-up proceedings and
property disposal.
The company's liquidator is:
Jess Shakespeare
c/o Maples Finance Limited
PO Box 1093, Boundary Hall
Grand Cayman KY1-1102
Cayman Islands
CLASSIC II: Shareholders' Final Meeting Set for November 16
-----------------------------------------------------------
The shareholders of Classic II (Cayman) Limited will hold their
final meeting on November 16, 2010, at 9:10 a.m., to receive the
liquidator's report on the company's wind-up proceedings and
property disposal.
The company's liquidator is:
Marc Randall
c/o Maples Finance Limited
PO Box 1093, Boundary Hall
Grand Cayman KY1-1102
Cayman Islands
DEPWADE LIMITED: Shareholders' Final Meeting Set for November 16
----------------------------------------------------------------
The shareholders of Depwade Limited will hold their final meeting
on November 16, 2010, at 9:00 a.m., to receive the liquidator's
report on the company's wind-up proceedings and property disposal.
The company's liquidator is:
Jess Shakespeare
c/o Maples Finance Limited
PO Box 1093, Boundary Hall
Grand Cayman KY1-1102
Cayman Islands
FIDELIO INC: Shareholders' Final Meeting Set for November 17
------------------------------------------------------------
The shareholders of Fidelio Inc. will hold their final meeting on
November 17, 2010, at 11:00 a.m., to receive the liquidator's
report on the company's wind-up proceedings and property disposal.
The company's liquidator is:
Jess Shakespeare
c/o Maples Finance Limited
PO Box 1093, Boundary Hall
Grand Cayman KY1-1102
Cayman Islands
GALTERE AGRICULTURE: Shareholders' Final Meeting Set for Nov. 17
----------------------------------------------------------------
The shareholders of Galtere Agriculture and Soft Commodities
Master Fund Ltd. will hold their final meeting on November 17,
2010, at 10:00 a.m., to receive the liquidator's report on the
company's wind-up proceedings and property disposal.
The company's liquidator is:
Jess Shakespeare
c/o Maples Finance Limited
PO Box 1093, Boundary Hall
Grand Cayman KY1-1102
Cayman Islands
GALTERE AGRICULTURE: Shareholders' Final Meeting Set for Nov. 17
----------------------------------------------------------------
The shareholders of Galtere Agriculture and Soft Commodities Fund
Ltd. will hold their final meeting on November 17, 2010, at
10:20 a.m., to receive the liquidator's report on the company's
wind-up proceedings and property disposal.
The company's liquidator is:
Jess Shakespeare
c/o Maples Finance Limited
PO Box 1093, Boundary Hall
Grand Cayman KY1-1102
Cayman Islands
IMCOPA INTERNATIONAL: Completes Noteholder Consent Solicitation
---------------------------------------------------------------
Imcopa International Cayman Ltd. and Imcopa Importacao, Exportacao
Industria e Oleos S.A. have successfully concluded their consent
solicitation in connection with U.S.$100,000,000 10.375% Notes due
2009.
The Issuer and Guarantor launched the Consent Solicitation on
October 4, 2010, to seek the consent of the holders of the Notes
to, among other things more fully described in the Statement,
amend the terms and conditions of the Notes, including with
respect to the timing and amounts of the payment of principal and
interest, by amending the trust deed dated November 27, 2006,
among the Issuer, the Guarantor and The Bank of New York Mellon,
as Trustee, as supplemented by supplemental trust deeds dated
December 28, 2007, June 2, 2008 and November 10, 2009,
respectively and the Conditions to conform to the terms of an
extrajudicial reorganization plan, which Reorganization Plan
Imcopa intends to seek to have confirmed under Brazilian law. The
final voting deadline for submission of electronic voting
instructions was 3:00 p.m. (London time) on October 22, 2010.
At a duly convened and quorate meeting held pursuant to the
Consent Solicitation Statement dated October 4, 2010 and the
related Notice of Meeting, Noteholders representing approximately
87.1% of the Notes outstanding for voting purposes voted in favour
of an extraordinary resolution to adopt the Proposal.
As a result of the passing of the extraordinary resolution, the
Issuer will make a consent payment to those Noteholders that
validly voted in favor of the Proposal, which payment will be
US$25.94 per US$1,000 principal amount of Notes voted in favor by
such Noteholders and will be made no later than November 4, 2010.
In addition, the Issuer, the Guarantor, other subsidiaries of
Imcopa that will become guarantors of the Notes upon judicial
confirmation of the Reorganization Plan and the Trustee have
entered into a fourth supplemental trust deed to reflect the
amended Conditions as set forth in the Proposal.
Under Brazilian law, in order to obtain the judicial confirmation
(homologacao) of the Reorganization Plan, it must be approved by
creditors holding three-fifths of each affected class of Imcopa's
indebtedness. Prior to the Consent Solicitation, Imcopa had the
necessary level of approval among its secured creditors. By
adopting the extraordinary resolution, the Noteholders, when taken
together with those of Imcopa's unsecured creditors who have
already approved the Reorganization Plan, have given Imcopa
sufficient support from its unsecured creditors. Imcopa will file
as soon as possible a petition with the Brazilian court to confirm
the Reorganization Plan, pursuant to which its terms will become,
as a matter of Brazilian law, binding on all secured and unsecured
financial creditors of Imcopa, including the Noteholders. Imcopa
expects to obtain judgment from the Brazilian court within a
period of four to nine months after filing, although no assurance
can be given that it will not take longer.
"Imcopa is very pleased with the results of the Consent
Solicitation," said Imcopa Chief Executive Officer Frederico Jose
Busato Jr. "It has taken a long time to be able to finalize a
restructuring plan that is fair both to our creditors and to
Imcopa, and we appreciate the patience and support that our
creditors, including the Noteholders, have shown us during this
time. We look forward to obtaining judicial confirmation of our
Reorganization Plan so that we may return our focus to our
operations and continue to grow our position in the industry as a
leading global GMO-free soybean processor."
HSBC Securities (USA) Inc. acted as sole Solicitation Agent and
Lucid Issuer Services Limited acted as Information and Tabulation
Agent in connection with the Consent Solicitation.
* * *
As reported in the Troubled Company Reporter-Latin America on
June 3, 2009, Standard & Poor's Ratings Services said that it has
lowered its rating on Brazil-based soy processor Imcopa
Importacao, Exportacao e Industria de Oleos S.A. to 'D' from 'CCC-
'. At the same time, S&P lowered its rating on Imcopa
International Cayman Ltd.'s $100 million 10.375% notes due 2009 to
'D'.
LATTICE PORTFOLIO: Shareholders' Final Meeting Set for Nov. 8
-------------------------------------------------------------
The shareholders of Lattice Portfolio Strategies SPC will hold
their final meeting on November 8, 2010, at 10:00 a.m., to receive
the liquidator's report on the company's wind-up proceedings and
property disposal.
The company's liquidator is:
Hugh Dickson
c/o Prudence Pryce
P.O. Box 1370, Grand Cayman KY1- 1108
Cayman Islands
Telephone: (345) 815 8240
Facsimile: (345) 949 7120
NEWSMITH GLOBAL: Shareholders' Final Meeting Set for November 16
----------------------------------------------------------------
The shareholders of Newsmith Global Opportunities Hedge Fund
Limited will hold their final meeting on November 16, 2010, at
9:00 a.m., to receive the liquidator's report on the company's
wind-up proceedings and property disposal.
The company's liquidator is:
Marc Randall
c/o Maples Finance Limited
PO Box 1093, Boundary Hall
Grand Cayman KY1-1102
Cayman Islands
OLDLAND LANE: Shareholders' Final Meeting Set for November 10
-------------------------------------------------------------
The shareholders of Oldland Lane Limited will hold their final
meeting on November 10, 2010, at 10:00 a.m., to receive the
liquidator's report on the company's wind-up proceedings and
property disposal.
The company's liquidator is:
Hugh Dickson
c/o Prudence Pryce
P.O. Box 1370, Grand Cayman KY1- 1108
Cayman Islands
Telephone: (345) 815 8240
Facsimile: (345) 949 7120
PEQUOT GLOBAL: Shareholders' Final Meeting Set for November 12
--------------------------------------------------------------
The shareholders of Pequot Global Extension Offshore Fund, Ltd.
will hold their final meeting on November 12, 2010, at 1:30 p.m.,
to receive the liquidator's report on the company's wind-up
proceedings and property disposal.
The company's liquidator is:
Walkers Corporate Services Limited
Walker House, 87 Mary Street
George Town Grand Cayman KY1-9002
Cayman Islands
PEQUOT GLOBAL: Shareholders' Final Meeting Set for November 12
--------------------------------------------------------------
The shareholders of Pequot Global Focus Offshore Fund, Ltd. will
hold their final meeting on November 12, 2010, at 2:00 p.m., to
receive the liquidator's report on the company's wind-up
proceedings and property disposal.
The company's liquidator is:
Walkers Corporate Services Limited
Walker House, 87 Mary Street
George Town Grand Cayman KY1-9002
Cayman Islands
PEQUOT MARKET: Shareholders' Final Meeting Set for November 12
--------------------------------------------------------------
The shareholders of Pequot Market Neutral Financial Services
Offshore Fund, Ltd. will hold their final meeting on November 12,
2010, at 2:15 p.m., to receive the liquidator's report on the
company's wind-up proceedings and property disposal.
The company's liquidator is:
Walkers Corporate Services Limited
Walker House, 87 Mary Street
George Town Grand Cayman KY1-9002
Cayman Islands
PEQUOT NEW: Shareholders' Final Meeting Set for November 12
-----------------------------------------------------------
The shareholders of Pequot New Prospect Offshore Fund, Ltd. will
hold their final meeting on November 12, 2010, at 1:45 p.m., to
receive the liquidator's report on the company's wind-up
proceedings and property disposal.
The company's liquidator is:
Walkers Corporate Services Limited
Walker House, 87 Mary Street
George Town Grand Cayman KY1-9002
Cayman Islands
REMO FINANCE: Shareholders' Final Meeting Set for November 17
-------------------------------------------------------------
The shareholders of Remo Finance Inc. will hold their final
meeting on November 17, 2010, at 11:00 a.m., to receive the
liquidator's report on the company's wind-up proceedings and
property disposal.
The company's liquidator is:
Jess Shakespeare
c/o Maples Finance Limited
PO Box 1093, Boundary Hall
Grand Cayman KY1-1102
Cayman Islands
SOUTHAM LANE: Shareholders' Final Meeting Set for November 10
-------------------------------------------------------------
The shareholders of Southam Lane Limited will hold their final
meeting on November 10, 2010, at 10:00 a.m., to receive the
liquidator's report on the company's wind-up proceedings and
property disposal.
The company's liquidator is:
Hugh Dickson
c/o Prudence Pryce
P.O. Box 1370, Grand Cayman KY1- 1108
Cayman Islands
Telephone: (345) 815 8240
Facsimile: (345) 949 7120
ST DRIVE: Shareholders' Final Meeting Set for November 17
---------------------------------------------------------
The shareholders of St Drive Inc. will hold their final meeting on
November 17, 2010, at 11:00 a.m., to receive the liquidator's
report on the company's wind-up proceedings and property disposal.
The company's liquidator is:
Jess Shakespeare
c/o Maples Finance Limited
PO Box 1093, Boundary Hall
Grand Cayman KY1-1102
Cayman Islands
VALENCE TECHNOLOGY: Shareholders' Final Meeting Set for Nov. 18
---------------------------------------------------------------
The shareholders of Valence Technology International Inc. will
hold their final meeting on November 18, 2010, at 10:00 a.m., to
receive the liquidator's report on the company's wind-up
proceedings and property disposal.
The company's liquidator is:
Ross A. Goolsby
12303 Technology Blvd. Ste-950
Austin, TX 78727
USA
VM FINANCE: Shareholders' Final Meeting Set for November 17
-----------------------------------------------------------
The shareholders of VM Finance Inc. will hold their final meeting
on November 17, 2010, at 11:00 a.m., to receive the liquidator's
report on the company's wind-up proceedings and property disposal.
The company's liquidator is:
Jess Shakespeare
c/o Maples Finance Limited
PO Box 1093, Boundary Hall
Grand Cayman KY1-1102
Cayman Islands
==================================
D O M I N I C A N R E P U B L I C
==================================
* DOMINICAN REPUBLIC: IMF Approves US$779 Million for Country
-------------------------------------------------------------
The Dominican Republic government will receive immediately
US$158.5 million in Special Drawing Rights from the International
Monetary Fund, equal to US$249 million, and US$530 million more
from the World and Inter-American Development banks before
yearend, for a total of US$779 million, The Dominican Today
reports.
According to the report, Central banker Hector Valdez Albizu on
Saturday said the Government will receive the funds after the IMF
Directory had approved the letter of intent submitted to the
multilateral entity at the beginning of October. The report
relates Mr. Albizu revealed that the Dominican economy grew 7.6%
to September and expects it will close at 7% this year.
* * *
As of October 20, 2010, the country continues to carry Moody's B2
country ceiling long-term foreign bank deposit rating and Ba2
country ceiling long-term foreign currency debt rating. The
country also continues to carry Fitch's B long-term issuer default
rating.
=============
J A M A I C A
=============
NATIONAL COMMERCIAL BANK: Former Executive to Go on Trial
---------------------------------------------------------
Former National Commercial Bank Senior Executive Lowell Spence,
who is accused of stealing more than JM$5 million from the
institution, is scheduled to go on trial on November 2, 2010,
RadioJamaica reports. Mr. Spence is the former regional manager
for NCB Insurance Services Limited.
According to the report, the trial date was set in May when
Mr. Spence appeared before the Corporate Area Criminal Court. The
report relates that following an investigation by the Police Fraud
Squad, Mr. Spence was charged in December last year with money
laundering, conspiracy to defraud and causing the bank to pay out
money.
It is alleged that in 2007, Mr. Spence, in his capacity as Relief
Manager, manipulated the system at the Annotto Bay branch and
siphoned off more than JM$5 million, the report notes.
The cops were called in after an internal audit uncovered the
alleged racket, the report relates.
About NCB
Headquartered in Kingston, Jamaica, the National Commercial Bank
Jamaica Limited -- http://www.jncb.com/-- provides commercial and
retail banking, wealth management services. The company's
services include personal banking, business banking, mortgage
loans, wealth management and insurance services. Founded in
1977, the bank primarily operates in West Indies and the U.K.
* * *
As reported in the Troubled Company Reporter-Latin America on
March 1, 2010, Fitch Ratings upgraded the ratings of Jamaica-based
National Commercial Bank Jamaica Limited's Long-term foreign and
local currency Issuer Default Rating to 'B-' from 'CCC'; Short-
term foreign and local currency IDR to 'B' from 'C'; and Support
floor to 'B-' from 'CCC'.
===========
M E X I C O
===========
MAQUINARIA ESPECIALIZADA: Fitch Puts 'BB-sf' Rating on Notes
------------------------------------------------------------
Fitch Ratings expects to assign this rating to the proposed
issuance of notes by the Maquinaria Especializada MXO Trust
Agreement No. F/00762, a Mexican trust created by Maquinaria
Especializada MXO, S.A. de C.V. (Geo Maquinaria) and The Bank of
New York Mellon, S.A. Institucion de Banca Multiple:
-- $160,000,000 notes due 2020 'BB-sf'; Outlook Stable.
Fitch's rating addresses the likelihood of timely payment of
interest and ultimate payment of principal by legal final
maturity, expected in 2020. The transaction will have a 10-year
tenor and is fully amortizing over the term. The interest rate
will be fixed.
The transaction's rating is directly linked to the senior
unsecured rating of Coporacion Geo (Geo Corp.) (Local Currency
Issuer Default Rating 'B+'; Foreign Currency IDR
'B+'/'BBB+[mex]'); Unsecured rating 'BB-') as Geo Corp. is
responsible for all payments under an unconditional and
irrevocable service agreement as well as any termination fees in
the event of default and/or termination of the agreement. The
expected rating of 'BB-sf' for the proposed notes reflects Fitch's
current assessment of Geo Corp.'s outstanding unsecured debt
obligations. In the event of a bankruptcy filing by Geo Corp.,
Fitch expects that the noteholders under the proposed issuance
will be in a pari-passu position with other senior unsecured
creditors via a claim against the termination fee required to be
paid by Geo Corp. under the terms of the SA.
Repayment for the proposed issuance of notes will be supported by
an irrevocable and unconditional quarterly service fee paid by Geo
Corp during a 10-year period under the terms of the SA entered
into by Geo Corp., various Geo Corp. subsidiaries and Geo
Maquinaria in exchange for the machinery utilization services for
Geo Corp. and its subsidiaries. Upon execution of the agreement,
which will be co-terminus with the transaction, Geo Maquinaria
will transfer the SA and the rights to all collections therein,
the machinery, and insurance policies to the issuer for inclusion
in the Trust Estate. Per the terms of the SA, Geo Corp. or the
issuer may terminate the agreement under certain circumstances
regarding breaches of service, prior to its expiration date. In
the event of a termination by either party, Geo Corp.'s sole
remedy is to pay the termination fee which will be at least the
face value of the notes at the time of termination. Funds held in
the reserve account will be available for any unpaid expenses then
due and payable before releasing any funds to Geo Corp.
Additional credit support is provided in the form of the sale of
Geo Corp.'s essential construction equipment to the trust, with an
appraised value of $64.6 million as of June 2010. In the event of
a default, the trust may liquidate this machinery and apply the
proceeds to pay down the debt balance. This equipment is
considered essential for Geo Corp. to conduct its day to day
operations and its inclusion in the trust provides a strong
incentive for Geo Corp. to honor its obligations under the Service
Agreement.
Geo Corp. maintains an important market share position within the
very competitive and fragmented Mexican homebuilding sector.
During 2009, the company sold 56,537 homes. Through the first six
months of 2010, Geo has titled 25,032 houses, an increase from
23,041 during the similar period in 2009.
In the next few years, Fitch expects slower revenue growth rates.
Operating margins should also decline as the company migrates
toward the lower income housing segment, a part of the market that
is becoming increasingly competitive. Between 2003 and 2009 the
number of homes sold by Geo Corp. increased from 29,520 to 56,537,
while revenues and operating income registered a compounded annual
growth rate of 14.5% and 15.4%, respectively. EBITDA margins
improved to 23% from 22.6% during the same period. Fitch expects
Geo Corp.'s EBITDA margins to range between 21% to 23% during
2010, considering a more balanced sales strategy that is
increasingly focused on the low-income segment.
Fitch expects to rate the $160 million notes due in 2020 'BB-sf'.
Final rating assignment is subject to completion of legal
documentation review and analysis.
VITRO SAB: Ad Hoc Committee Rejects Initial Consent Solicitation
----------------------------------------------------------------
TO ALL VITRO NOTEHOLDERS
Vitro is shortly expected to launch its long-awaited consent
solicitation. It has chosen to do so without the support of any
member of the Steering Group, nor from any other independent
creditor constituent. Assuming the Initial Consent Solicitation
is launched on the terms that we have been led to believe by Vitro
and its advisors, the Initial Consent Solicitation will offer an
unacceptably poor economic outcome for Noteholders and as such,
the Steering Group intends at this time, based upon available
information, to reject the Initial Consent Solicitation and
encourages all Noteholders to do the same.
We would draw Noteholders attention to two important
considerations when reviewing the Initial Consent Solicitation:
First, as proposed, the economic terms are considerably less
favorable than terms put forward by Vitro during recent meetings
with certain Steering Group members. Further, the Steering Group
understands that Vitro will incorporate various coercive
incentives designed to intimidate Noteholders into supporting the
Initial Consent Solicitation and will no doubt claim that it has
widespread support among creditors.
Second, none of the Steering Group members, nor our financial and
legal advisors, have had any involvement or participation with
respect to the new debt indentures and associated legal or other
documentation governing the proposed restructured securities.
Both the Initial Consent Solicitation and the documentation have
been drafted by Vitro with input only from its informal advisor,
and future shareholder, Fintech, thus we expect that it will
compromise the economic and legal position of the Noteholders.
Notwithstanding almost 18 months of patient negotiation, the
Steering Group is surprised and disappointed at Vitro decision to
launch the Initial Consent Solicitation on terms worse than
previously offered during discussions and without giving the
Steering Group any opportunity to review and give input to the
Initial Consent Solicitation documents. The Steering Group
encourages all Noteholders to defer taking any action with respect
to the Initial Consent Solicitation until they have had the
opportunity to properly analyze the terms of the proposal and
understand its potential legal and economic implications.
Accordingly, once the Initial Consent Solicitation is launched,
the Steering Group and its advisors, White & Case LLP and Chanin
Capital Partners LLC, will schedule and hold a conference call
open to all Noteholders during which we will discuss the Initial
Consent Solicitation and its consequences.
The foregoing shall not be construed as tax, legal, business,
financial, accounting or other advice, and Noteholders are
encouraged to consult their own advisors. The Steering Group
reserves all of its rights and remedies available to it under law
and contract.
Sincerely,
Steering Group for the Ad Hoc Committee of Vitro Noteholders
The Steering Group for the Ad Hoc Committee of Vitro Noteholders
may be reached at:
John Cunningham, Esq.
Richard Kebrdle, Esq.
WHITE & CASE LLP
Telephone: (305) 995-5252
(305) 995-5276
Email: JCunningham@whitecase.com
RKebrdle@whitecase.com
- and -
Brian Cullen, Esq.
Mark Catania, Esq.
CHANIN CAPITAL PARTNERS LLC
Telephone: (310) 445-4010
(310) 445-4010
Email: BCullen@chanin.com
MCatania@chanin.com
About Vitro SAB
Headquartered in Monterrey, Mexico, Vitro, S.A.B. de C.V. (BMV:
VITROA; NYSE: VTO), through its two subsidiaries, Vitro Envases
Norteamerica, SA de C.V. and Vimexico, S.A. de C.V., is a global
glass producer, serving the construction and automotive glass
markets and glass containers needs of the food, beverage, wine,
liquor, cosmetics and pharmaceutical industries.
* * *
In June 2010, Fitch Ratings withdrew all ratings of Vitro, S.A.B.
de C.V., given the lack of information following the company's
default on Feb. 2, 2009, and consistent with Fitch's policies.
Fitch will no longer provide ratings or credit research on the
Company. Andres R. Martinez at Bloomberg News said in June that
Vitro was suspended from trading in Mexico City after failing to
file its fourth-quarter earnings report. The company missed the
June 2 deadline for the results, Mexico's stock exchange said in
an e-mailed statement obtained by the news agency. Vitro plans to
file the report once its debt restructuring is complete or if
ordered by a judge. Vitro said that the suspension won't affect
company operations.
On June 30, 2009, Galaz, Yamazaki, Ruiz Urquiza, S.C., member of
Deloitte Touche Tohmatsu and C.P.C. Jorge Alberto Villarreal in
Monterrey, N.L., Mexico raised substantial doubt about the
Company's ability to continue as a going concern after auditing
financial results for the period ended Dec. 31, 2007, and 2008.
The auditors pointed out to the Company's net loss and its non-
compliance with covenants related to its long-term debt
obligations.
===============================
T R I N I D A D & T O B A G O
===============================
CL FIN'L: CLICO Policyholders Reject 20-Year IOU
------------------------------------------------
The Trinidad and Tobago government has been given a week to decide
on new proposals submitted by a group of policyholders of the cash
strapped Colonial Life Insurance Company, Jamaica Gleaner reports.
CLICO is a subsidiary of CL Financial Limited.
According to the report, the proposal revealed that the Kamla
Persad Bissessar government is being asked to pay an immediate 40%
to depositors, with a promise to pay the balance quarterly over a
five-to seven-year period at 4.0 to 4.5% interests.
Jamaica Gleaner notes that the proposal is one of two that deputy
chairman for the CLICO Policyholders Group Peter Permell said had
been delivered to the government's technical team, headed by
Minister of Food Production Vasant Bharath, and which is now
before Cabinet for consideration.
"The 'Dookeran plan' of 0% over 20 years is off the table," the
report quoted Mr. Permell as saying. "The policyholders with a
principal balance plus capital interest exceeding TT$75,000
(US$12,500) should be paid 40% of the outstanding liability
immediately and the balance by Government of Trinidad and Tobago
bonds amortized on a quarterly basis over the next five to seven
years between four to four and a half per cent interest on this
money."
Jamaica Gleaner notes that under the government plan outlined by
Finance Minister Winston Dookeran during the budget presentation
last month, government will make an initial partial payment of a
maximum of TT$75,000 to depositors in the short-term investment
and mutual funds, and those whose principal balances exceed
TT$75,000 will be paid through a Government IOU amortized over 20
years at zero interest.
Mr. Dookeran, the report discloses, said the government IOU would
be structured in such a way that it could be traded on the
secondary markets, thereby creating a measure of immediate
liquidity for the depositors.
However, the report relates, Mr. Permell told the meeting at
Woodford Square in the heart of the capital on Sunday that "we not
accepting any TT$75,000". The counter-proposal called for those
depositors with up to TT$75,000 investment, credit unions and
trade unions be paid 100 per cent, since they represented the
"small people" who pooled their money to make up the investments,
he added.
Bond Warranty
The proposal, Jamaica Gleaner notes, was specifically tailored for
the Executive Flexible Preferred Annuity and mutual-fund
policyholders, and did not include Clico Investment Bank, the
government, State enterprises or private corporations.
The report relates Mr. Permell said a "warranty" should be placed
on the bonds that would allow them to cash in on any profits from
the sale of the CL Financial assets. The profit would be shared
at 51:49 per cent ratio, with the policyholders retaining the
majority over the government, which he described as "more than
reasonable," he added.
Mr. Permell, the report posts, said that the proposal included an
"as soon as possible" cut-off date. The report relates Mr.
Permell said that the depositors were already owed two months of
interest, and to ensure that the arrears payments do not "pile
up," he suggested a cut-off date of October 31.
"The government should also pay some sort of interest on that
arrears at the market rate, which is about five per cent. The
bonus is now on them to implement payment immediately," the report
quoted Mr. Permell as saying.
A second, but less popular proposal, outlined on Sunday, is to
give the US$600 million the government has earmarked to pay the
investors to Ryan ALM, an asset management company out of the
United States, which would be charged with investing that money to
ensure the most profitable pay-outs and turn over the cash within
a 20-year period, the report adds.
About CL Financial
CL Financial Limited is a privately held conglomerate in Trinidad
and Tobago. Founded as an insurance company, Colonial Life
Insurance Company by Cyril Duprey, it was expanded into a
diversified company by his nephew, Lawrence Duprey. CL Financial
is now one of the largest local conglomerates in the region,
encompassing over 65 companies in 32 countries worldwide with
total assets standing at roughly US$100 billion.
* * *
As reported in the Troubled Company Reporter-Latin America on
August 10, 2009, A.M. Best Co. downgraded the financial strength
rating to C (Weak) from B (Fair) and issuer credit rating to "ccc"
from "bb" of Colonial Life Insurance Company (Trinidad) Limited
(CLICO) (Trinidad & Tobago). The ratings remain under review with
negative implications. CLICO is an insurance member company of CL
Financial Limited (CL Financial), a diversified holding company
based in Trinidad & Tobago.
According to a TCRLA report on Feb. 20, 2009, citing Trinidad and
Tobago Express, Tobago President George Maxwell Richards signed
bailout bills for CL Financial, giving the government the
authority to control the company's unit, Colonial Life Insurance
Company, and giving the central bank extensive powers to treat
with CL Financial's collapse and the consequent systemic crisis.
===============
X X X X X X X X
===============
* Upcoming Meetings, Conferences and Seminars
---------------------------------------------
Oct. 28, 2010
AMERICAN BANKRUPTCY INSTITUTE
Mid-Level Professional Development Program
Weil, Gotshal & Manges LLP, New York, N.Y.
Contact: 1-703-739-0800; http://www.abiworld.org/
Oct. 29, 2010 (tentative)
AMERICAN BANKRUPTCY INSTITUTE
International Insolvency Symposium
The Savoy, London, England
Contact: 1-703-739-0800; http://www.abiworld.org/
Nov. __, 2010
AMERICAN BANKRUPTCY INSTITUTE
Delaware Views from the Bench and Bankruptcy Bar
Hotel du Pont, Wilmington, Del.
Contact: 1-703-739-0800; http://www.abiworld.org/
Nov. 11, 2010
AMERICAN BANKRUPTCY INSTITUTE
Detroit Consumer Bankruptcy Conference
Hyatt Regency Dearborn, Dearborn, Mich.
Contact: 1-703-739-0800; http://www.abiworld.org/
Nov. 29, 2010
RENAISSANCE AMERICAN MANAGEMENT, INC. & BEARD GROUP, INC.
17th Annual Distressed Investing Conference
The Helmsley Park Lane Hotel, New York City
Contact: 1-903-595-3800;
http://www.renaissanceamerican.com/
Dec. 9-11, 2010
AMERICAN BANKRUPTCY INSTITUTE
Winter Leadership Conference
Camelback Inn, a JW Marriott Resort & Spa,
Scottsdale, Ariz.
Contact: 1-703-739-0800; http://www.abiworld.org/
Dec. 2-4, 2010
AMERICAN BANKRUPTCY INSTITUTE
22nd Annual Winter Leadership Conference
Camelback Inn, Scottsdale, Arizona
Contact: 1-703-739-0800; http://www.abiworld.org/
January 26-28, 2011
TURNAROUND MANAGEMENT ASSOCIATION
TMA Distressed Investing Conference
Aria Las Vegas
Contact: http://www.turnaround.org/
Jan. 27-28, 2011
AMERICAN BANKRUPTCY INSTITUTE
Rocky Mountain Bankruptcy Conference
Westin Tabor Center, Denver, Colo.
Contact: 1-703-739-0800; http://www.abiworld.org/
Feb. 3-5, 2011
AMERICAN BANKRUPTCY INSTITUTE
Caribbean Insolvency Symposium
Westin Casuarina Resort & Spa, Grand Cayman Island
Contact: 1-703-739-0800; http://www.abiworld.org/
Feb. 24-25, 2011
AMERICAN BANKRUPTCY INSTITUTE
Valcon
Four Seasons Las Vegas, Las Vegas, Nev.
Contact: 1-703-739-0800; http://www.abiworld.org/
Mar. 4, 2011
AMERICAN BANKRUPTCY INSTITUTE
Bankruptcy Battleground West
Hyatt Regency Century Plaza, Los Angeles, Calif.
Contact: 1-703-739-0800; http://www.abiworld.org/
Mar. 7-9, 2011
AMERICAN BANKRUPTCY INSTITUTE
Conrad Duberstein Moot Court Competition
Duberstein U.S. Courthouse, New York, N.Y.
Contact: 1-703-739-0800; http://www.abiworld.org/
Mar. 10, 2011
AMERICAN BANKRUPTCY INSTITUTE
Nuts and Bolts - Florida
Tampa, Fla.
Contact: 1-703-739-0800; http://www.abiworld.org/
Mar. 10-12, 2011
AMERICAN BANKRUPTCY INSTITUTE
SUCL/ Alexander L. Paskay Seminar on
Bankruptcy Law and Practice
Marriott Tampa Waterside, Tampa, Fla.
Contact: 1-703-739-0800; http://www.abiworld.org/
Mar. 17-19, 2011
AMERICAN BANKRUPTCY INSTITUTE
Byrne Judicial Clerkship Institute
Pepperdine University School of Law, Malibu, Calif.
Contact: 1-703-739-0800; http://www.abiworld.org/
Mar. 31-Apr. 3, 2011
AMERICAN BANKRUPTCY INSTITUTE
Annual Spring Meeting
Gaylord National Resort & Convention Center,
National Harbor, Md.
Contact: 1-703-739-0800; http://www.abiworld.org/
April 27-29, 2011
TURNAROUND MANAGEMENT ASSOCIATION
TMA Spring Conference
JW Marriott, Chicago, IL
Contact: http://www.turnaround.org/
May 5, 2011
AMERICAN BANKRUPTCY INSTITUTE
Nuts and Bolts - New York City
Association of the Bar of the City of New York,
New York, N.Y.
Contact: 1-703-739-0800; http://www.abiworld.org/
May 6, 2011
AMERICAN BANKRUPTCY INSTITUTE
New York City Bankruptcy Conference
Hilton New York, New York, N.Y.
Contact: 1-703-739-0800; http://www.abiworld.org/
June 6, 2011
AMERICAN BANKRUPTCY INSTITUTE
Canadian-American Cross-Border Insolvency Symposium
Fairmont Royal York, Toronto, Ont.
Contact: 1-703-739-0800; http://www.abiworld.org/
June 9-12, 2011
AMERICAN BANKRUPTCY INSTITUTE
Central States Bankruptcy Workshop
Grand Traverse Resort and Spa, Traverse City, Mich.
Contact: http://www.abiworld.org/
July 21-24, 2011
AMERICAN BANKRUPTCY INSTITUTE
Northeast Bankruptcy Conference
Hyatt Regency Newport, Newport, R.I.
Contact: 1-703-739-0800; http://www.abiworld.org/
July 27-30, 2011
AMERICAN BANKRUPTCY INSTITUTE
Southeast Bankruptcy Workshop
The Sanctuary at Kiawah Island, Kiawah Island, S.C.
Contact: 1-703-739-0800; http://www.abiworld.org/
Aug. 4-6, 2011
AMERICAN BANKRUPTCY INSTITUTE
Mid-Atlantic Bankruptcy Workshop
Hotel Hershey, Hershey, Pa.
Contact: 1-703-739-0800; http://www.abiworld.org/
Oct. 14, 2011
AMERICAN BANKRUPTCY INSTITUTE
NCBJ/ABI Educational Program
Tampa Convention Center, Tampa, Fla.
Contact: 1-703-739-0800; http://www.abiworld.org/
Oct. __, 2011
AMERICAN BANKRUPTCY INSTITUTE
International Insolvency Symposium
Dublin, Ireland
Contact: 1-703-739-0800; http://www.abiworld.org/
Oct. 25-27, 2011
TURNAROUND MANAGEMENT ASSOCIATION
Hilton San Diego Bayfront, San Diego, CA
Contact: http://www.turnaround.org/
Dec. 1-3, 2011
AMERICAN BANKRUPTCY INSTITUTE
23rd Annual Winter Leadership Conference
La Quinta Resort & Spa, La Quinta, Calif.
Contact: 1-703-739-0800; http://www.abiworld.org/
Apr. 19-22, 2012
AMERICAN BANKRUPTCY INSTITUTE
Annual Spring Meeting
Gaylord National Resort & Convention Center,
National Harbor, Md.
Contact: 1-703-739-0800; http://www.abiworld.org/
July 14-17, 2012
AMERICAN BANKRUPTCY INSTITUTE
Southeast Bankruptcy Workshop
The Ritz-Carlton Amelia Island, Amelia Island, Fla.
Contact: 1-703-739-0800; http://www.abiworld.org/
Aug. 2-4, 2012
AMERICAN BANKRUPTCY INSTITUTE
Mid-Atlantic Bankruptcy Workshop
Hyatt Regency Chesapeake Bay, Cambridge, Md.
Contact: 1-703-739-0800; http://www.abiworld.org/
Nov. 29 - Dec. 2, 2012
AMERICAN BANKRUPTCY INSTITUTE
Winter Leadership Conference
JW Marriott Starr Pass Resort & Spa, Tucson, Ariz.
Contact: 1-703-739-0800; http://www.abiworld.org/
***********
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, Marites O. Claro, Joy A. Agravante, Rousel Elaine C.
Tumanda, Valerie C. Udtuhan, Frauline S. Abangan, and Peter A.
Chapman, Editors.
Copyright 2010. 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 * * *