/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/120511.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 Friday, May 11, 2012, Vol. 13, No. 094 Headlines A R G E N T I N A SUPERVIELLE CREDITOS: Moody's Rates ARS4.8MM Certs. 'Caa1.ar' B A R B A D O S REDJET: Barbados Government Won't Turn Its Back on Firm C A Y M A N I S L A N D S CREDIT DISTRESSED: Creditors' Proofs of Debt Due June 4 CREDIT DISTRESSED MASTER: Creditors' Proofs of Debt Due June 4 CREDIT DISTRESSED OFFSHORE: Creditors' Proofs of Debt Due June 4 FOREVER SMILING: Creditors' Proofs of Debt Due June 7 REPRESENTATIVE SERVICES: Creditors' Proofs of Debt Due June 14 SUMMO LIMITED: Creditors' Proofs of Debt Due June 7 SUMMO LIMITED: Shareholders' Final Meeting Set for June 12 TELL FUND: Creditors' Proofs of Debt Due May 29 TRADING SELECT: Creditors' Proofs of Debt Due May 28 WHITE STAR: Creditors' Proofs of Debt Due June 7 WHITE STAR: Shareholders' Final Meeting Set for June 12 WILLIAM FUND: Creditors' Proofs of Debt Due May 29 J A M A I C A * JAMAICA: Swamped by Interest on Debt M E X I C O BANCA MIFEL: S&P Gives 'B-' Rating to $200MM Subordinated Notes BANCA MIFEL: Fitch to Rate Subordinated Pref. Notes at 'B' CREDITO INMOBILIARIO: Moody's Cuts Sr. Unsecured Rating to Caa3 TV AZTECA: Fitch Affirms Rating on $300-Mil. Sr. Notes at 'BB-' P U E R T O R I C O ALCO CORP: Wants Access to Banco Popular's Cash Until June 30 ALCO CORP: Wants to Use PRHTA's Cash to Pay PTLC's Claim PR WIRELESS: Moody's Lowers CFR to 'B3'; Outlook Stable PRWIRELESS INC: S&P Affirms 'B' Corp. Credit Rating; Outlook Neg - - - - - ================= A R G E N T I N A ================= SUPERVIELLE CREDITOS: Moody's Rates ARS4.8MM Certs. 'Caa1.ar' ------------------------------------------------------------- Moody's Investors Service rates Supervielle Creditos 60, which is a transaction that will be issued by Equity Trust S.A., acting solely in its capacity as Issuer and Trustee. Moody's notes that as of May 9, the securities contemplated by this transaction have not yet settled. If any assumptions or factors considered by Moody's in assigning the ratings change before closing, Moody's could change the ratings assigned to the notes. - ARS42,000,000 in Class A Fixed Rate Debt Securities of "Fideicomiso Financiero Supervielle Creditos 60", rated Aaa.ar (sf) (Argentine National Scale) and Ba1 (sf) (Global Scale, Local Currency) - ARS63,600,000 in Class B Floating Rate Debt Securities of "Fideicomiso Financiero Supervielle Creditos 60", rated Aaa.ar (sf) (Argentine National Scale) and Ba1 (sf) (Global Scale, Local Currency) - ARS9,600,000 in Class C Fixed Rate Debt Securities of "Fideicomiso Financiero Supervielle Creditos 60", rated Aa2.ar (sf) (Argentine National Scale) and B1 (sf) (Global Scale, Local Currency) - ARS4,800,000 in Certificates of "Fideicomiso Financiero Supervielle Creditos 60", rated Caa1.ar (sf) (Argentine National Scale) and Caa3 (sf) (Global Scale, Local Currency) Ratings Rationale The rated securities are payable from the cash flow coming from the assets of the trust, which is an amortizing pool of approximately 23,406 eligible personal loans denominated in Argentine pesos, with a fixed interest rate, originated by Banco Supervielle, in an aggregate amount of ARS120,008,008.02. These personal loans are granted to pensioners that receive their monthly pensions from ANSES (Argentina's National Governmental Agency of Social Security - Administracion Nacional de la Seguridad Social). The pool is also constituted by loans granted to government employees of the Province of San Luis. Banco Supervielle is the payment agent entity and automatically deducts the monthly loan installment directly from the employee's paycheck and pensioner's payment. Overall credit enhancement is comprised of subordination: 65% for the Class A Fixed Rate Debt Securities, 12% for the Floating Rate Securities and 4% for the Class C Fixed Rate Securities. In addition the transaction has various reserve funds and excess spread. Moody's considered the credit enhancement provided in this transaction through the initial subordination levels for each rated class, as well as the historical performance of Supervielle's portfolio. In addition, Moody's considered factors common to consumer loans securitizations such as delinquencies, prepayments and losses; as well as specific factors related to the Argentine market, such as the probability of an increase in losses if there are changes in the macroeconomic scenario in Argentina. These factors were incorporated in a cash flow model that takes into account all the relevant features of the transaction's assets and liabilities. Monte Carlo simulations were run, which determines the expected loss for the rated securities. Moody's considered factors common to consumer loans securitizations such as delinquencies, prepayments and losses; as well as specific factors related to the Argentine market. These factors were incorporated in a cash flow model in order to determine the expected loss for the rated securities. Finally, Moody's also evaluated the back-up servicing arrangements in the transaction. In assigning the rating to this transaction, Moody's assumed a triangular distribution for defaults on the main pool centered around a most likely scenario of 10%, a minimum of 5% and a maximum of 20%. Also, Moody's assumed a triangular distribution for prepayments centered around a most likely scenario of 20%, a minimum of 15% and a maximum of 35%. These assumptions are derived from the historical performance to date of the Supervielle's pools. The model results showed 0.00% expected loss for Class A Fixed Rate Debt Securities and Class B Floating Rate Debt Securities, 5.47% expected loss for Class C Fixed Rate Debt Securities and 37.40% for the Certificates. Moody's ran several stress scenarios, including increases in the default rate assumptions. If default rates were increased 6% from the base case scenario for the pool (i.e., most likely scenario of 16%, a minimum of 11% and a maximum of 26%), the ratings of the Classes A and Class B. The ratings for Class C Fixed Rate debt securities and Certificates would be likely downgraded to Ca (sf) and C (sf) respectively. Moody's also considered the risk that a disruption in the flow of payments from ANSES or the Government of San Luis to pensioners and employees respectively, could severely affect the performance of the pool. Moody's believes that the ratings assigned are consistent with this risk. Finally, Moody's also evaluated the back-up servicing arrangements in the transaction. If Banco Supervielle is removed as servicer, Equity Trust S.A. will be appointed as the back-up servicer. The main source of uncertainty for this transaction is the regulatory and legal framework for the automatic deduction loans in Argentina. =============== B A R B A D O S =============== REDJET: Barbados Government Won't Turn Its Back on Firm ------------------------------------------------------- RJR News reports that the Barbadian Government said it will not turn its back on REDjet (Airone Caribbean/Airone Ventures Limited). However, Prime Minister Freundel Stuart said the government has to ensure that all the I's are dotted and T's are crossed before any steps are taken to invest taxpayers' money in the air carrier, according to RJR News. The report relates that Mr. Stuart said that it is imperative that the Government determine that the company is following all the rules and the country can truly realize value for money. The Prime Minister disclosed on the weekend that he has asked his Minister of State, Senator Darcy Boyce, to secure a copy of REDjet's balance sheet, RJR News notes. The data will assist the administration in determining the airline's future, he added, the report says. As reported in the Troubled Company Reporter-Latin America on March 26, 2012, RJR News reports that REDjet's decision to suspend all flights came a day after the airline announced the addition of its new route to Antigua and Barbuda. REDjet officials are calling on the Barbadian government for close to $8,000,000 in assistance, and to receive the same subsidies as other airlines, RJR News noted. The report disclosed that Mr. Maharaj said governments cannot continue to expose themselves as a guarantor to private enterprises. REDjet (Airone Caribbean/Airone Ventures Limited) is a startup low-cost carrier (LCC) based at the Grantley Adams International Airport in Christ Church, Barbados, near Bridgetown. Incorporated in Barbados, the privately owned airline features a fleet of McDonnell Douglas MD-82 and MD-83 aircraft. =========================== C A Y M A N I S L A N D S =========================== CREDIT DISTRESSED: Creditors' Proofs of Debt Due June 4 ------------------------------------------------------- The creditors of Credit Distressed Blue Line Intermediate Fund, Ltd. are required to file their proofs of debt by June 4, 2012, to be included in the company's dividend distribution. The company commenced wind-up proceedings on April 1, 2012. The company's liquidator is: Ogier c/o Madeleine Welham Telephone: (345) 815-1750 Facsimile: (345) 949-9877 89 Nexus Way, Camana Bay Grand Cayman KY1-9007 Cayman Islands CREDIT DISTRESSED MASTER: Creditors' Proofs of Debt Due June 4 -------------------------------------------------------------- The creditors of Credit Distressed Blue Line Master Fund, Ltd. are required to file their proofs of debt by June 4, 2012, to be included in the company's dividend distribution. The company commenced liquidation proceedings on April 1, 2012. The company's liquidator is: Ogier c/o Madeleine Welham Telephone: (345) 815-1750 Facsimile: (345) 949-9877 89 Nexus Way, Camana Bay Grand Cayman KY1-9007 Cayman Islands CREDIT DISTRESSED OFFSHORE: Creditors' Proofs of Debt Due June 4 ---------------------------------------------------------------- The creditors of Credit Distressed Blue Line Offshore Fund, Ltd. are required to file their proofs of debt by June 4, 2012, to be included in the company's dividend distribution. The company commenced liquidation proceedings on April 1, 2012. The company's liquidator is: Ogier c/o Madeleine Welham Telephone: (345) 815-1750 Facsimile: (345) 949-9877 89 Nexus Way, Camana Bay Grand Cayman KY1-9007 Cayman Islands FOREVER SMILING: Creditors' Proofs of Debt Due June 7 ----------------------------------------------------- The creditors of Forever Smiling Limited are required to file their proofs of debt by June 7, 2012, to be included in the company's dividend distribution. The company commenced liquidation proceedings on April 19, 2012. The company's liquidator is: C.I. Directors Ltd. Telephone: (345) 943 2237 Facsimile: (345) 949 6096 P.O. Box 1100 Grand Cayman KY1-1102 Cayman Islands REPRESENTATIVE SERVICES: Creditors' Proofs of Debt Due June 14 -------------------------------------------------------------- The creditors of Representative Services Limited are required to file their proofs of debt by June 14, 2012, to be included in the company's dividend distribution. The company commenced liquidation proceedings on April 19, 2012. The company's liquidator is: Westport Services Ltd. c/o Bonnie Willkom Telephone: (345) 949 5122 Facsimile: (345) 949 7920 PO Box 1111 Grand Cayman KY1-1102 Cayman Islands SUMMO LIMITED: Creditors' Proofs of Debt Due June 7 --------------------------------------------------- The creditors of Summo Limited are required to file their proofs of debt by June 7, 2012, to be included in the company's dividend distribution. The company commenced liquidation proceedings on April 19, 2012. The company's liquidator is: C.I. Directors Ltd. Telephone: (345) 943 2237 Facsimile: (345) 949 6096 P.O. Box 1100 Grand Cayman KY1-1102 Cayman Islands SUMMO LIMITED: Shareholders' Final Meeting Set for June 12 ---------------------------------------------------------- The shareholders of Summo Limited will hold their final meeting on June 12, 2012, 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: C.I. Directors Ltd. Telephone: (345) 943 2237 Facsimile: (345) 949 6096 P.O. Box 1100 Grand Cayman KY1-1102 Cayman Islands TELL FUND: Creditors' Proofs of Debt Due May 29 ----------------------------------------------- The creditors of The Tell Fund are required to file their proofs of debt by May 29, 2012, to be included in the company's dividend distribution. The company commenced liquidation proceedings on April 19, 2012. The company's liquidator is: CDL Company Ltd. P.O. Box 31106 Grand Cayman KY1-1205 Cayman Islands TRADING SELECT: Creditors' Proofs of Debt Due May 28 ---------------------------------------------------- The creditors of Trading Select (USA) Ltd. are required to file their proofs of debt by May 28, 2012, to be included in the company's dividend distribution. The company commenced liquidation proceedings on April 18, 2012. The company's liquidator is: Beverly Mathias c/o Citco Trustees (Cayman) Limited P.O. Box 31106 Grand Cayman KY1-1205 Cayman Islands WHITE STAR: Creditors' Proofs of Debt Due June 7 ------------------------------------------------ The creditors of White Star Investments Holdings Limited are required to file their proofs of debt by June 7, 2012, to be included in the company's dividend distribution. The company commenced liquidation proceedings on April 19, 2012. The company's liquidator is: C.I. Directors Ltd. Telephone: (345) 943 2237 Facsimile: (345) 949 6096 P.O. Box 1100 Grand Cayman KY1-1102 Cayman Islands WHITE STAR: Shareholders' Final Meeting Set for June 12 ------------------------------------------------------- The shareholders of White Star Investments Holdings Limited will hold their final meeting on June 12, 2012, at 10:30 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: C.I. Directors Ltd. Telephone: (345) 943 2237 Facsimile: (345) 949 6096 P.O. Box 1100 Grand Cayman KY1-1102 Cayman Islands WILLIAM FUND: Creditors' Proofs of Debt Due May 29 -------------------------------------------------- The creditors of The William Fund are required to file their proofs of debt by May 29, 2012, to be included in the company's dividend distribution. The company commenced liquidation proceedings on April 19, 2012. The company's liquidator is: CDL Company Ltd. P.O. Box 31106 Grand Cayman KY1-1205 Cayman Islands ============= J A M A I C A ============= * JAMAICA: Swamped by Interest on Debt -------------------------------------- David McFadden at the Associated Press reports that a Washington- based think tank said debt-shackled Jamaica's interest payments as a percentage of gross domestic product were the highest in the world last year even after a domestic debt restructuring two years ago. A new report on Jamaica's economy by the Center for Economic and Policy Research says the heavily-indebted Caribbean country's total interest payments were about US$1.4 billion in 2011, or about 10% of GDP, according to The AP. The report relates that it's about two-and-a-half times what was spent on capital programs. The report notes that economist and center co-director Mark Weisbrot said that it was the highest percentage anywhere in the world, even in crisis-staggered countries in the 17-nation Eurozone. For years, roughly half of the Jamaican government's budget has been dedicated to paying the debt, and that has forced the middle-income country to scrimp on schools, hospitals and infrastructure, The AP says. "The burden of excessively high interest payments will continue to displace public investments, which are needed to restore normal growth and bring down the persistently high levels of poverty and unemployment," the group said in its report, The AP discloses. The report relays that Jamaica's economy has sputtered for decades. The island's economy grew by 1.5% last year after three years of negative growth rates, but the economy still remains below its 2008 level of GDP, the group said, the report notes. Overall, Jamaica's debt was about 130 percent of gross domestic product last year, according to The AP The AP relays that Jamaican analysts said that much of the island's public debt was derived from bad bank loans that the government absorbed to resolve a mid-1990s crisis when dozens of banks failed amid a spree of lending. By 2010, Jamaica's towering debt and the damaging impact of the global recession forced the government to again seek assistance from the International Monetary Fund, the report notes. It helped the government carry out a domestic debt restructuring and provided US$1.27 billion in a standby loan, the report relates. It also unlocked funding from other global lending groups, The AP says. But the Center for Economic and Policy Research believes that the 2010 domestic debt restructuring program did little to solve the underlying problem even if it did reduce interest payments in the short term, the report adds. =========== M E X I C O =========== BANCA MIFEL: S&P Gives 'B-' Rating to $200MM Subordinated Notes --------------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'B-' rating on Banca Mifel S.A.'s (BM) cumulative fixed unsecured subordinated notes of up to $200 million. The rating on the notes is three notches below the long-term issuer credit rating on BM (BB- /Stable/B). The rating also reflects these: * The notes will be subordinated to senior creditors; interest deferral can occur in the event of higher withholding taxes or inadequate regulatory capital ratio; * The notes are structured to be eligible for regulatory solvency purposes, as TIER II. * "We classify the notes as having 'minimal equity content' under our hybrid capital criteria, which means they won't be part of our calculation of total adjusted capital, which forms the basis of our consolidated risk-based capital, but rather be part of BM's long-term debt due to the notes' tenor of up to 10 years and the bank's current rating level," S&P said. * BM plans to issue these notes to take advantage of current financing conditions and to repurchase its outstanding hybrid instruments. "The ratings on BM reflect our assessment of its moderate business position, capital and earnings, and risk position, below-average funding and adequate liquidity, relative to its Mexican peers. We believe that the risk-adjusted capital framework adequately reflects the bank's credit, market, and operational risks," S&P said. RATINGS LIST Banca Mifel S.A. Issuer Credit Rating Global Scale BB-/Stable/B National Scale mxBBB+/Stable/mxA-2 Rating Assigned Banca Mifel S.A. $200M hybrid B- BANCA MIFEL: Fitch to Rate Subordinated Pref. Notes at 'B' ---------------------------------------------------------- Fitch Ratings expects to assign a 'B' rating to Banca Mifel's upcoming issue of cumulative subordinated preferred notes due 2022. The final amount will range between US$150-US$200 million. The expected rating is two notches below Mifel's viability rating of 'bb-', according to Fitch's Dec. 15, 2011 criteria report for such securities ('Rating Bank Regulatory Capital and Similar Securities'). The notching indicates the higher expected loss for more junior debt instruments. In the event of bankruptcy (concurso mercantil), liquidation or dissolution, the Notes will rank junior to all of Mifel's present and future senior indebtedness. The notes will rank pari passu with all other present or future unsecured subordinated preferred liabilities, and senior only to subordinated non-preferred indebtedness and common equity. The proposed notes will rank senior to the outstanding US$100 million perpetual non-cumulative junior subordinated callable notes that were placed in 2007 and Fitch rated it 'B-', which explains the rating difference among these securities. While the proposed notes are dated instruments, these will likely receive a 50% equity credit during the first five years outstanding. This is given its subordination and coupon omission features, but mainly as a result of Fitch's perception of certain permanence. Coupons and even principal could be deferred well before the bank reaches a non-viability condition. This is in accordance to the relatively high regulatory trigger for such deferrals. Established in 1993, Mifel is the largest entity of Grupo Financiero Mifel. Mifel also has factoring, leasing and mutual fund management companies. Mifel has traditionally targeted SMEs and medium-sized real estate developers, and more recently government related entities. CREDITO INMOBILIARIO: Moody's Cuts Sr. Unsecured Rating to Caa3 --------------------------------------------------------------- Moody's de Mexico downgraded the following ratings of Credito Inmobiliario, S.A. de C.V. ("CI") -- national scale senior unsecured debt rating to Caa3.mx, from Baa1.mx (global scale local currency senior unsecured debt rating to (P)Caa3, from (P)B1); national scale issuer rating to Caa3.mx, from Baa1.mx (global scale local currency rating to Caa3, from B1); national scale short-term rating to MX-4, from MX-2. The rating outlook was revised to negative. Ratings Rationale These rating actions reflect the company's default on its debt amortizations payment due May 8, 2012, mounting nonperforming assets (delinquent and non performing loans, foreclosed assets, plus restructured loans), low earnings potential in the short term, deteriorating financial standing, and minimal growth prospects. The Caa3 ratings also reflects the expected recovery on the company's default on its current debt obligations amortization. CI missed the principal and interest payment on its unsecured debt obligation of CINMOBI 09, which has a partial guarantee of up to 65% from Sociedad Hipotecaria Federal. This default caused the acceleration of the payment of principal and accrued interest of several other of the company's unsecured debt obligations. Credito Inmobiliario's negative rating outlook reflects the uncertainty as to the future of CI's liquidity, repayment of its commercial paper program amortization, as well as the company's future viability as a going concern. The company's liquidity is strained as it is very dependent on the resolution of the company's negotiations with its commercial paper program lenders. Moody's stated that the ratings will be downgraded further should the company not be able to continue operations as a going concern and/or the expected recovery to the commercial paper lenders is lower than currently expected. The following ratings were downgraded with a negative outlook: Credito Inmobiliario, S.A. de C.V. -- national scale senior unsecured debt rating to Caa3.mx, from Baa1.mx (global scale local currency senior unsecured debt rating to (P)Caa3, from (P)B1); national scale issuer rating to Caa3.mx, from Baa1.mx (global scale local currency rating to Caa3, from B1); national scale short-term rating to MX-4, from MX-2. Moody's last rating action with respect to Credito Inmobiliario was on October 19, 2011, when Moody's downgraded the following ratings of Credito Inmobiliario, S.A. de C.V.'s -- national scale senior unsecured debt rating to Baa1.mx, from A3.mx (global scale local currency senior unsecured debt rating to (P)B1, from (P)Ba3) and national scale issuer rating to Baa1.mx, from A3.mx (global scale local currency rating to B1, from Ba3). Concurrently, Moody's affirmed Credito Inmobilirario's national scale short-term rating at MX-2 (global scale local currency rating at Not Prime). The rating outlook was revised to developing. Credito Inmobiliario is a non-bank financial institution (Sofom Mortgage Company). It is one of the largest independent mortgage originators of this kind in Mexico and its main activities consist of extending mortgage loans financed by monies from SHF to low-income individuals and providing construction financing to low-income housing developers. The firm reported total assets of $12.4 billion Mexican pesos and total equity of $779 million Mexican pesos at March 31, 2012. Credito Inmobiliario's ratings were assigned by evaluating factors Moody's believes are relevant to the credit profile of the issuer, such as i) the business risk and competitive position of the company versus others within its industry, ii) the capital structure and financial risk of the company, iii) the projected performance of the company over the near to intermediate term, and iv) management's track record and tolerance for risk. These attributes were compared against other issuers both within and outside of Creditio Inmobiliario's core industry and the company's ratings are believed to be comparable to those of other issuers of similar credit risk. TV AZTECA: Fitch Affirms Rating on $300-Mil. Sr. Notes at 'BB-' --------------------------------------------------------------- Fitch Ratings has affirmed TV Azteca, S.A.B. de CV's ratings as follows: -- Long-term Issuer Default Rating (IDR) at 'BB-'; -- Local currency IDR at 'BB-'; -- USD300 million Senior Notes due 2018 'BB-'. The Rating Outlook is Stable. TV Azteca's ratings reflect its business position as the second largest TV broadcaster in Mexico with national presence and one of the largest Spanish speaking TV companies worldwide. The ratings consider the company's financial profile and strong cash generation, which in turn has been used in past years to finance growth, pay dividends, capital reductions and share repurchases. TV Azteca's ratings are limited by the mature stage of the industry, high competition from traditional and new distribution platforms, limited revenue diversification base, as well as the company's debt structure and financial flexibility. TV Azteca's business position reflects its stable market share in the domestic market. Mexico's TV broadcasting market is comprised of two national networks (Grupo Televisa, S.A.B. and TV Azteca) and smaller regional and local broadcasters. Television continues to be the most important mass media in Mexico for advertisers. The company's revenues are supported in the attractiveness of its internally produced content which allows it to align advertisers with specific demographics. Traditionally, advertisers with presence in broadcasted TV in Mexico are engaged in less cyclical segments such as consumer goods and services, which in turn have been translated into stable cash flows during economic cycles. During 2011, TV Azteca's revenues grew 3% versus 2010, compared to a national GDP growth of 4%. This increase reflects TV Azteca's market share gains during the year, and improved economic conditions. TV Azteca's profitability has remained strong reflecting higher and stable audience ratings, which in turn have translated into better pricing (price linked to rating points) and management's strict cost and expenses control. Costs and expenses have remained relatively stable at 51 - 52% and 11 - 11.6% of revenues, respectively. As a result, EBITDA Margin was 39.8% in 2011, slightly below 40.9% in 2010 and 41.4% at year-end 2009. Considering the adoption of IFRS reporting standards, for the three months ended on March 31, 2012 the company's EBITDA Margin (operating income plus depreciation and amortization) was 28.8%, similar to 28.2% in the same period of the previous year on a comparable basis. In recent years internally generated cash has been the company's main source to finance growth and cash distributions to shareholders. The company's strategy continues to be focused in the production of robust programming which requires investment in talent and facilities. For 2012 capex and other investments related mostly to exhibition rights would be in the range of approximately USD50 million and dividend payments of approximately USD26 million, which Fitch sees manageable for the company's forecasted cash generation and that those levels will remain relatively stable in the near future. Historically, the company has supported its liquidity requirements with uncommitted short-term credit facilities. TV Azteca's financial profile is strong for the rating category and has been stable in recent years. Total Debt to EBITDA for 2011 was 2.4 times (x) compared to 2.0 x, 2.2x and 2.5x at year- end 2010, 2009 and 2008, respectively. For the same periods, Interest expense covered by EBITDA was 5.0x, compared to 4.8x, 4.4x and 3.9x. For the LTM at March 2012 leverage was 2.2x and Interest Coverage 4.7x. Liquidity risk is low with total debt as of March 31, 2012 of MXN10.8 billion, Short Term debt of MXN595 million and Cash of MXN8.2 billion. TV Azteca's debt is comprised of structured Certificados Bursatiles with an outstanding balance of MXN5.4 billion which started its amortization in 2011 through 2020, USD300 million in Senior Notes issued in 2011 equivalent to MXN3.9 billion and MXP1.5 billion (USD120 million) financing with American Tower Corp. maturing in 2020 with an option to be extended until 2069. The company's financial flexibility is limited by its restricted access to debt markets (banks and capital markets). While liquidity risk is low and the company's debt maturity profile is adequate, it is important to remark that approximately 50% of the company's total debt as of March 31, 2012 is secured by 22% of national advertising revenues, which is senior to all debt instruments. Factors that could lead to a positive rating action include a combination of: additional profitable business lines contributing to positive cash flow generation, consistent lower leverage through the cycle, sustained increase in market share that would lead to higher cash generation allowing the company to reduce working capital needs. Conversely, negative factors that could affect the company's credit profile are: declining market share, results and profitability; increased leverage; size, form and rollout of future investments; higher than expected cash distributions to shareholders. ===================== P U E R T O R I C O ===================== ALCO CORP: Wants Access to Banco Popular's Cash Until June 30 ------------------------------------------------------------- Alco Corporation asks the U.S. Bankruptcy Court for the District of Puerto Rico to approve a stipulation authorizing the Debtor's limited use of certain of Banco Popular's cash collateral. The Debtor relates that it has no debtor-in-possession financing and requires the use of the cash collateral to satisfy operating expenses and continue operating its business. As of the Petition Date, Banco Popular asserts that it is owed $968,776. Pursuant to the stipulation: -- Banco Popular consents to the use of cash collateral until June 30, 2012; -- As adequate protection from any diminution in value for the lender's collateral, the Debtor will grant Banco Popular a replacement liens and postpetition security interest on all of the assets and collateral acquired by the Debtor from the Petition Date; and -- As additional adequate protection, the Debtor agrees that upon the consummation of any sale of substantially all of the Debtor's assets encumbered in favor of Banco Popular, and in any event if not earlier paid, the proceeds of the sale, or any other amount agreed by the parties will be paid immediately and indefeasibly to Banco Popular. A full-text copy of the stipulation is available for free at http://bankrupt.com/misc/ALCOCORP_cashcoll_stipulation_b.pdf About Alco Corp. Alco Corporation in Dorado, Puerto Rico, filed for Chapter 11 bankruptcy (Bankr. D. P.R. Case No. 12-00139) on Jan. 12, 2012. Carmen D. Conde Torres, Esq., and C. Conde & Associates represents the Debtor in its restructuring effort. Alco tapped Jimenez Vasquez & Associates, PSC, as accountants. The Debtor scheduled $11.2 million in assets and $7.76 million in debts. The petition was signed by Alfonso Rodriguez, president. ALCO CORP: Wants to Use PRHTA's Cash to Pay PTLC's Claim -------------------------------------------------------- Alco Corporation and secured creditor MAPFRE Praico Insurance Company ask U.S. Bankruptcy Court for the District of Puerto Rico to approve a stipulation for the release of the cash collateral subject to security interest held by MAPFRE. The parties relate that on Oct. 27, 2010, MAPFRE issued performance and payment bond for the project. The Puerto Rico Highway and Transportation Authority is the owner of the project -- Reparacion de Pavimentos Asfalticos en Carreteras Regional Norte, Varios Municipios ACT-801262, Subasta Formal P-08-010 Proy. Fed. LP-9999(77) -- and named obligee in the Bond. On Oct. 13, 2010, Parking and Traffic Lines Corp., submitted an extrajudicial claim against the PRHTA for the amount of $146,869, allegedly owed by Alco in connection with labor and materials supplied in the project. The parties agree that the PRHTA Payment Check, which is in PRHTA's possession, constitutes cash collateral and it is not property of the estate as it has been established by the applicable case. The Debtor would use the cash collateral as partial payment to PTLC's Claim. A full-text copy of the stipulation is available for free at http://bankrupt.com/misc/ALCOCORP_cashcoll_stipulation.pdf About Alco Corp. Alco Corporation in Dorado, Puerto Rico, filed for Chapter 11 bankruptcy (Bankr. D. P.R. Case No. 12-00139) on Jan. 12, 2012. Carmen D. Conde Torres, Esq., and C. Conde & Associates represents the Debtor in its restructuring effort. Alco tapped Jimenez Vasquez & Associates, PSC, as accountants. The Debtor scheduled $11.2 million in assets and $7.76 million in debts. The petition was signed by Alfonso Rodriguez, president. PR WIRELESS: Moody's Lowers CFR to 'B3'; Outlook Stable ------------------------------------------------------- Moody's Investors Services downgraded PR Wireless' corporate family and probability of default ratings to B3 from B2. Moody's also downgraded to B3 from B2 the rating of the company's senior secured bank credit facility The ratings outlook is stable. Ratings Rationale The downgrade of the ratings was based on Moody's belief that PR Wireless expected shift in its business strategy will result in a deterioration of its operating results in the near term with uncertain consequences in the medium term. This, coupled with the highly competitive nature of the Puerto Rican telecom market, further increases the company's already high business risk. Lower operating profits will delay PR Wireless' ability to reduce leverage at the pace expected by Moody's. The lower results have reduced the covenant cushion and has prompted the company to obtain amendments to the terms and conditions of its existing credit facilities, which Moody's expects will increase the covenant cushion but will reduce the company's financial flexibility. Moody's estimates that, in 2012 and 2013, PR Wireless' adjusted financial leverage will continue at or above 4 times. The agency's original expectation is that this leverage ratio would have been at an average of 3.5 times for the period 2012-2013. Although the revised leverage ratio is not significantly high for a B2 rated telco, the new business plan will increase cash flow risk, which is particularly challenging in a highly competitive telecom market such as that of Puerto Rico. Thus, PR wireless' credit risk is expected to increase in the near term. Moody's adjusted debt reflects capitalized leases and 25% debt attributed to preferred stock. PR Wireless' liquidity position remains adequate, although vulnerable to unpredictable operating results and the successful conclusion of the amendment to the credit agreements, which is expected within a week. Moody's believes that the company's expected EBITDA for the remainder of 2012 and 2013 should be sufficient to cover cash outflows during the period, which include interest payments, upcoming debt amortizations, working capital, taxes and capex. And, the existing USD15 million revolver credit facility, which matures in mid 2014, provides additional liquidity protection. In addition, the company's debt maturity profile remains relatively comfortable since the vast majority of total debt is composed of loans that mature in 2016. Moody's believes that management will avoid paying dividends in amounts that could jeopardize the company's liquidity profile or ability to make committed payments and invest in growth capex as planned. PR Wireless' B3 ratings are principally based on its small revenue size relative to its peers, which include AT&T and America Movil, as well as its small market share in Puerto Rico. The ratings are supported by growing subscriber base despite the current adverse economic environment in Puerto Rico. In 2010 and 2011, PR Wireless' subscriber base increased by over 13% and 5%, respectively. However, operating margins fell as a result of higher handset subsidies driven by increased competitive pressures. Moody's expects competition to remain intense or increase even further, especially as major carriers work to expand their service offerings in Puerto Rico. Considering PR Wireless' small size and the highly competitive environment where it operates, a ratings upgrade is unlikely near term. Over the longer term positive pressure could result if the company is able to reduce its adjusted debt/EBITDA leverage to below 3.5 times and simultaneously grow operating margins and free cash flow. If PR Wireless' liquidity situation deteriorates or if the company is not able to grow revenues and its new business plan increases operating costs such that its adjusted Debt/EBITDA leverage remains above 5 times beyond 2013 and adjusted EBITDA- capex/interest expense ratio remains below 1.5 times for an extended period of time, the ratings would be under downward pressure. In addition, shareholder payouts or business expansion that will increase leverage and depress free cash flow would adversely impact the ratings. The principal methodology used in rating PR Wireless, Inc was the Moody's Global Telecommunications Industry Methodology, published December 2010. PR Wireless (brand name Open Mobile) is a wireless service provider in Puerto Rico. It is owned by the holding company PR Wireless, LLC (incorporated in Delaware, U.S.), which in turn, is owned by M/C Venture Partners (35%), Columbia Capital (35%) and Leap Wireless (18%), among others. PR Wireless began operations in June 2007 after the bankruptcy and reorganization of its predecessor entity, MoviStar, Inc. With approximately 11% subscriber market share as of March 2012, the company generated revenues of US$191 million and adjusted EBITDA of US$69 million in the last twelve months ended December 31, 2011. PRWIRELESS INC: S&P Affirms 'B' Corp. Credit Rating; Outlook Neg ---------------------------------------------------------------- Standard & Poor's Ratings Services revised its outlook on Guaynabo, Puerto Rico-based PRWireless Inc (d/b/a Open Mobile) to negative from stable. "We also affirmed our ratings on the company, including the 'B' corporate credit rating and the 'B' issue rating on $199 million of outstanding secured credit facilities. The '3' recovery rating on the secured debt remains unchanged and indicates expectations for meaningful (50%-70%) recovery of principal in the event of payment default," S&P said. "The outlook revision reflects our belief that PRWireless may be under pressure to remain compliant with the consolidated leverage ratio covenant in the current credit agreement as that tightens in the second quarter of 2012," said Standard & Poor's credit analyst Richard Siderman. "However, we do note that the company is currently in discussions to amend the credit agreement, which could result in relaxation of the problematic leverage covenant." "The negative outlook also cites our expectation that the company will actively target higher priced, datacentric customers," added Mr. Siderman, "and that the related customer acquisition costs could temporarily depress EBITDA and result in leverage not supportive of the rating, given our view of a 'vulnerable' business risk profile." "The negative outlook incorporates two paths that could each lead to a potential downgrade. PRWireless could be challenged to remain in compliance with the leverage covenant in its secured credit agreement as it tightens in the second quarter of 2012 unless current discussions with banks to amend the credit facility result in sufficient relaxation of that covenant. Second, we expect the company to exploit its increasing 4G availability by more actively marketing higher ARPU, data-centric service plans. However, the related higher subscriber acquisition costs, coupled with declining USF payments, could pressure EBITDA and result in debt leverage (including our analytical adjustments) in the low to mid-5x range, which would not be supportive of the rating given our view of a vulnerable business risk. We would consider a stable outlook if the problematic covenant issue were adequately addressed and if operating performance indicated that the company would be able to maintain debt leverage (including our adjustments for operating leases and preferred securities) in the mid 4x area," S&P said. *********** 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. 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