/raid1/www/Hosts/bankrupt/TCRLA_Public/130726.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, July 26, 2013, Vol. 14, No. 147
Headlines
A R G E N T I N A
BANCO SANTANDER: Moody's Assigns Ba3 Rating to ARS500MM Issuance
MUNICIPALITY OF LA PLATA: Fitch Affirms 'B-' Currency Ratings
B R A Z I L
EVEN CONSTRUTORA: Fitch Affirms Issuer Default Ratings at 'BB-'
* BRAZIL: Ceara State to Receive $400 Million IDB Loan
C A Y M A N I S L A N D S
ASIA PACKAGING: Shareholders' Final Meeting Set for Aug. 8
ASIA PACKAGING GROUP: Shareholders' Final Meeting Set for Aug. 8
ASIA PACKAGING HOLDINGS: Shareholders' Meeting Set for Aug. 8
CROSS STAFF: Shareholders' Final Meeting Set for Aug. 26
GULFMENA MASTER: Shareholders' Meeting Set for Aug. 19
GULFMENA OPPORTUNITIES: Shareholders' Meeting Set for Aug. 19
INUIT INVESTMENTS: Shareholders' Final Meeting Set for Aug. 15
LANTERNE ARRAN: Shareholders' Final Meeting Set for Aug. 15
LANTERNE ARRAN MASTER: Shareholders' Final Meeting Set for Aug. 15
ORCHARD II: Members' Final Meeting Set for Aug. 12
TT ASIAN: Shareholders' Final Meeting Set for Aug. 15
TT ASIAN ALPHA: Shareholders' Final Meeting Set for Aug. 15
TT FINANCIALS: Shareholders' Final Meeting Set for Aug. 15
USISSIMO LIMITED: Shareholders' Final Meeting Set for Aug. 30
XU JIA: Members' Final Meeting Set for Aug. 12
D O M I N I C A N R E P U B L I C
* DOMINICAN REPUBLIC: Haiti Lacks Political Will to Talk Openly
M E X I C O
FIDEICOMISO MAQUINARIA: S&P Cuts Rating on US$160MM Notes to 'CC'
MAXCOM TELECOMUNICACIONES: Files for Bankruptcy in the U.S.
MAXCOM TELECOMUNICACIONES: Case Summary & 30 Top Unsec. Creditors
PLAYA RESORTS: Moody's Rates Proposed $350MM Term Loan '(P)B2'
QUALITAS CONTROLADORA: S&P Assigns 'BB' Rating; Outlook Stable
QUINTANA ROO: Poor Performance Cues Moody's to Cut Ratings to B3
T R I N I D A D & T O B A G O
CL FINANCIAL: Rowley Wants 'Transparent' Deal On Assets
X X X X X X X X X
* Moody's Notes Weak ABS SME Performance in EMEA Sectors
- - - - -
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A R G E N T I N A
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BANCO SANTANDER: Moody's Assigns Ba3 Rating to ARS500MM Issuance
----------------------------------------------------------------
Moody's Investors Service assigned a Ba3 global local currency
debt rating to Banco Santander Rio's third expected issuance up to
ARS500 million, which will be due in 18 months. At the same time,
Moody's Latin America assigned Aaa.ar national scale local
currency debt rating to Santander Rio's expected issuance.
The outlook for all ratings is negative, following the negative
outlook on the sovereign ratings.
The following ratings were assigned to Banco Santander Rio S.A.'s
expected issuance:
Issuance up to ARS 500 million:
Ba3 Global Local Currency Debt Rating
Aaa.ar Argentina National Scale Local Currency Debt Rating
Ratings Rationale:
Moody's explained that the local currency senior unsecured debt
rating derives from the bank's Ba3 global local currency deposit
rating, Moody's also noted that seniority was taken into
consideration in the assignment of the debt ratings.
Moody's has assigned a Ba3 global local currency deposit rating to
Santander R¡o, which derived from the bank's b3 BCA and its
assessment of the moderate probability of parental support to be
provided by its shareholder Santander Spain, rated Baa2 with
negative outlook.
The standalone ratings capture Santander's well established
franchise as the largest private bank in the Argentinean banking
system, as well as its diversified earnings as it expands its
range of business activities and customer base. The bank's well-
defined footprint in the corporate and consumer lending segment
ensures good asset quality. Santander's rating also incorporates
its significant payroll accounts base, which provides not only a
significant client base for cross selling, but supports asset
quality because of the low risk nature of the product, while
ensuring a significant share of core, inexpensive deposits, which
lowers its cost of funding.
Banco Santander Rio S.A. is headquartered in Buenos Aires, with
assets of ARS 56,4 billion and equity of ARS 7,2 billion as of
March 2013.
The principal methodology used in this rating was Global Banks
Methodology published in May 2013.
Moody's National Scale Ratings (NSRs) are intended as relative
measures of creditworthiness among debt issues and issuers within
a country, enabling market participants to better differentiate
relative risks. NSRs differ from Moody's global scale ratings in
that they are not globally comparable with the full universe of
Moody's rated entities, but only with NSRs for other rated debt
issues and issuers within the same country. NSRs are designated by
a ".nn" country modifier signifying the relevant country, as in
".mx" for Mexico.
MUNICIPALITY OF LA PLATA: Fitch Affirms 'B-' Currency Ratings
-------------------------------------------------------------
Fitch Ratings has affirmed its ratings on the Municipality of La
Plata, Argentina (MLP) as follows:
-- Long-term foreign and local currency ratings at 'B-';
-- National long-term rating at 'AA-(arg)'.
The Rating Outlook is Negative.
KEY RATING DRIVERS
Historically, MLP has recorded sound operating margins. This
savings, coupled with capital transfers, has enabled MLP to
finance its public investment and even generate surplus budgetary
resources. In 2012, the operating margin was 25.1%, marking a
significant increase with respect to 15.1% from the prior year.
This resulted from MLP's careful administration of its own
revenues due to the enforcement of a new tax law and a more
controlled increase of operating expenses. However, a weaker
operating savings is possible for 2013, but Fitch expects it to
still be positive and adequate.
MLP's Low Indebtedness: At year-end 2012 MLP's direct debt was ARS
53.4 million, representing a decrease of 32% against 2011, which
resulted largely from a reduction in short-term obligations due to
a very good operative balance. MLP's indebtedness is very low at
4.7% of the operating revenues, and equivalent to 0.2 times (x) of
the current balance. The municipal administration does not plan to
take on more debt in 2013, but Fitch believes that based on MLP's
present level of indebtedness flexibility to incur additional debt
is wide if the municipality decides to do so.
Fitch also views MLP's adequate budgetary flexibility favorably.
MLP's third party-sourced revenue/total operating revenue averaged
48.5% during the 2008-2012 period. This shows a low exposure of
the municipality's income to federal and provincial transfers.
Moreover, MLP's personnel costs during this period 2008-2012
represented a low 34.1% of its operating revenue, which makes its
budget performance more resilient to current pressure from wage
hikes.
The City of La Plata is the Province of Buenos Aires' capital city
and the seat of the provincial government. It is also home to one
of the country's leading universities, the National University of
La Plata. These academic and political strengths imply a
significant floating population which puts pressure on the demand
on municipal services.
Regarding short-term pressure, MLP's 2012 data shows that good
budget performance allowed the improvement of liquidity and a
convenient reduction of the consolidated short-term and floating
debt exposure. In 2012, the short-term debt was AR 60.9 million,
equivalent to 5.3% operating revenues and takeover 21.1 days,
while these ratios in 2011 were 11.5% and 42 days respectively.
This strong liquidity position covered 2.3 times this debt versus
0.6x in 2011.
About contingencies; the recent crises due to floods determined a
higher level of expenses for the MLP. However, the adequate fiscal
and financing performance together with the assistance received
from the national and provincial government, forecasts a minimum
weakening of the operating margin. Municipal authorities informed
in respect to the necessary public infrastructure works to prevent
floods, that due to the magnitude of these works and the
geographic zone affected the intervention of provincial and
national governments will be imperative.
RATING SENSITIVITIES
MLP's Negative Outlook reflects a high correlation between the
credit risk of subnationals and the sovereign. A country ceiling
downgrade would lead to negative rating action. In addition, a
sharp deterioration in the operating margins due to pressures in
the operating expenses because an inflationary context might have
an adverse impact on ratings.
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B R A Z I L
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EVEN CONSTRUTORA: Fitch Affirms Issuer Default Ratings at 'BB-'
---------------------------------------------------------------
Fitch Ratings has affirmed Even Construtora e Incorporadora S.A.'s
(Even) foreign and local currency Issuer Default Ratings (IDRs) at
'BB-'. At the same time, Fitch has upgraded Even's national long-
term rating to 'A+(bra)' from 'A(bra)'. The Outlook for the
corporate ratings is Stable.
KEY RATING DRIVERS
These rating actions reflect the strengthening of Even's credit
profile within its international rating category of 'BB-',
resulting in the national rating upgrade. Even has been efficient
in preserving its adequate operating performance and conservative
credit metrics in a more challenging scenario for the domestic
homebuilding sector. Fitch consider the company's maintenance of
comfortable liquidity and low corporate debt maturities up to the
end of 2014 as positives. The ratings also take into consideration
Even's solid execution capacity and steady growth in the Brazilian
real estate construction market, with operations concentrated in
Sao Paulo. Even has preserved sales speed above the sector average
and reduced its inventory of ready units to 4% of the total
inventory at March 2013.
The company's vulnerability to the cyclical downturns of the real
estate sector and high dependency on the domestic economy and
credit availability were factored into the ratings.
CONSISTENT OPERATING RESULTS
Even has reported consistent operating results since 2009, despite
the increasingly challenging environment for the homebuilding
sector. The company has a vertical integration and executes most
of its projects, as well as applies controls and monthly reviews
of its projects, concentrated in selected markets. These factors
prevented Even from unexpected project cost adjustments, as
opposed to the majority of the Brazilian homebuilders. In the last
12 months (LTM) ended March 2013, net revenues totaled BRL2.1
billion and EBITDA generation was BRL410 million. The company
reported stable EBITDA margins, which averaged 19.7% in the last
four years, and was 19.3% in the LTM ended March 2013, higher than
the industry average. Fitch expects Even to preserve EBITDA margin
between 18% and 19% in 2013 and 2014.
Even preserved sales speed above sector average, while quarterly
sales over supply average, net of sales cancellations, was 23% in
2012, and 18% in the first quarter of 2013 due to lower volume of
project launches. The company launched BRL2.5 billion of potential
sales value (PSV) in 2012, compared to BRL2.1 billion in 2011 and
BRL1.5 billion in 2010. In the first quarter of 2013, the company
launched BRL286 million of PSV.
COMFORTABLE LIQUIDITY POSITION
Even's conservatively managed liquidity has been sufficient to
sustain its expansion plans and meet corporate debt maturities. At
end March 2013, cash and marketable securities totaled BRL586
million, and total adjusted debt was BRL1.7 billion, of which
BRL583 million was in the short term. Even's liquidity remains
comfortable since 70%, or BRL405 million, of short-term debt is
related to the Housing Financial System (SFH) financings. This
debt is adequate for the sector as it is secured by specific
receivables from units sold and under construction and will be
paid off upon delivery of the units through the transfer of the
receivables to SFH creditor banks. SFH credit lines represented
more than half of total debt since 2010 and were 62% at the end of
March 2013. As of March 31, 2013, cash was sufficient to
comfortably cover 335% of corporate debt maturities of BRL175
million up to the end of 2014.
The company's liquidity position is strengthened by BRL425 million
of receivables of concluded units not linked to debt at end March
2013. Even's financial strategy to preserve a relevant liquidity
is positive and should allow the company to manage planned project
launches in 2013 and 2014.
LEVERAGE REMAINS CONSERVATIVE
Even has maintained an adequate capital structure, which has
assured support for a steady increase in project launches. In the
LTM period ended March 2013, total adjusted debt/EBITDA ratio was
of 4.1 times (x) and net adjusted debt/EBITDA was of 2.7x. Net
leverage remained relatively stable and averaged 2.5x since 2009.
Fitch does not expect an increase of the company's corporate debt
over the next two years and leverage should remain near current
levels.
NEGATIVE CASH FLOW FROM OPERATIONS EXPECTED FOR 2013
In 2012, Even's cash flow from operations (CFFO) benefitted from a
high volume of project deliveries and the more agile process to
transfer homebuyer receivables to banks. The company delivered a
total PSV of BRL1.9 billion in 2012, compared to BRL1.3 billion in
2011 and BRL900 million in 2010. During the LTM ended March 2013,
Even generated BRL227 million of funds from operations (FFO), and
CFFO was slightly negative BRL9 million. These figures compare
with FFO of BRL284 million and CFFO of BRL93 million in 2012. CFFO
should be pressured in 2013 due to lower expected volume of
deliveries at about BRL1.3 billion and considering project
launches at 2012's level. Cash generation should improve in 2014
and turn positive.
RATING SENSITIVITIES
Positive rating actions could be driven by relevant and consistent
generation of positive free cash flow, combined with the
maintenance of strong liquidity and conservative leverage ratios.
The ratings could be negatively affected by the combination of
weakening operating margins, liquidity reduction, and increase in
leverage. An unstable macroeconomic environment that affects the
fundamentals of the real estate sector could also lead to negative
rating actions.
Fitch has taken the following rating actions:
-- Local currency long-term Issuer Default Rating (IDR)
affirmed at 'BB-';
-- Foreign currency long-term IDR at affirmed at 'BB-';
-- Long-term National Scale rating upgraded to 'A+(bra)'
from 'A(bra)';
-- Fifth debenture issuance, in the amount of BRL250 million,
due in 2016, upgraded to 'A+(bra)' from 'A(bra)'.
* BRAZIL: Ceara State to Receive $400 Million IDB Loan
------------------------------------------------------
The Brazilian northeastern state of Ceara will receive a $400
million loan from the Inter-American Development Bank (IDB) to
improve highways and logistics infrastructure, enhancing
connectivity between productive regions and consumer markets, and
regional ports and airports.
The program will finance the rehabilitation of 560 kilometers of
roads and the paving of another 410 kilometers of highways,
improve the system's efficiency. This will allow drivers to stop
using secondary roads, shortening the distance to get to their
final destination and lowering transport costs. The project will
interconnect highways with productive development areas.
In the stretch of highway CE-060, an important road that connects
the two largest cities in the state, Fortaleza and Crato, a
rehabilitation and result-driven maintenance pilot project will be
implemented. This project will help the government evaluate the
benefits of a new highway maintenance management standard through
an ongoing evaluation of quality indicators.
In order to enhance road safety, the project will identify
critical points in roads to be rehabilitated and finance the works
needed to improve safety.
In addition to improve the state's cargo transportation, the
project will support the development of a transportation and
logistics plan for the state and the implementation of priority
actions identified in the state's master transport and
environmental plan. These two actions will be carried by Ceara
highway department (DER/CE).
The IDB and the State of Ceara have a history of more than 20
years working on transportation programs. This is the project's
fourth stage, and according to Dalve Soria, the project's team
leader, "the relationship between the IDB and DER/EC has been
extremely rewarding in recent years, and we are sure that our
joint efforts in improving the transportation of goods and
services have contributed significantly to the development of the
state and therefore the quality of life of its people."
The IDB's financing terms are 25 years, with a grace period of
five and a half years, and a LIBOR-based interest rate.
==========================
C A Y M A N I S L A N D S
==========================
ASIA PACKAGING: Shareholders' Final Meeting Set for Aug. 8
----------------------------------------------------------
The shareholders of Asia Packaging Company Limited will hold their
final meeting on Aug. 8, 2013, at 9:30 a.m., to receive the
liquidator's report on the company's wind-up proceedings and
property disposal.
The company's liquidator is:
Mourant Ozannes Cayman Liquidators Limited
94 Solaris Avenue, Camana Bay
P.O. Box 1348 Grand Cayman KY1-1108
Cayman Islands
ASIA PACKAGING GROUP: Shareholders' Final Meeting Set for Aug. 8
----------------------------------------------------------------
The shareholders of Asia Packaging Group Holdings Limited will
hold their final meeting on Aug. 8, 2013, at 11:30 a.m., to
receive the liquidator's report on the company's wind-up
proceedings and property disposal.
The company's liquidator is:
Mourant Ozannes Cayman Liquidators Limited
94 Solaris Avenue, Camana Bay
P.O. Box 1348 Grand Cayman KY1-1108
Cayman Islands
ASIA PACKAGING HOLDINGS: Shareholders' Meeting Set for Aug. 8
-------------------------------------------------------------
The shareholders of Asia Packaging Holdings Limited will hold
their final meeting on Aug. 8, 2013, 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:
Mourant Ozannes Cayman Liquidators Limited
94 Solaris Avenue, Camana Bay
P.O. Box 1348 Grand Cayman KY1-1108
Cayman Islands
CROSS STAFF: Shareholders' Final Meeting Set for Aug. 26
--------------------------------------------------------
The shareholders of Cross Staff Protected Profits Plus Bond Fund
Ltd. will hold their final meeting on Aug. 26, 2013, 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:
Michael Penner
c/o Grant Hiley
Deloitte & Touche
Citrus Grove Building, 4th Floor
Goring Avenue, George Town KY1-1109
Cayman Islands
Telephone: +1 (345) 814 2353
Facsimile: +1 (345) 949 8258
GULFMENA MASTER: Shareholders' Meeting Set for Aug. 19
------------------------------------------------------
The shareholders of Gulfmena Opportunities Master Fund Limited
will hold their final meeting on Aug. 19, 2013, 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:
Alric Lindsay
Telephone: (345) 926 1688
c/o Artillery Court
Shedden Road
P.O. Box 11371, George Town
Grand Cayman KY1-1008
Cayman Islands
GULFMENA OPPORTUNITIES: Shareholders' Meeting Set for Aug. 19
-------------------------------------------------------------
The shareholders of Gulfmena Opportunities Fund Limited will hold
their final meeting on Aug. 19, 2013, at 9:30 a.m., to receive the
liquidator's report on the company's wind-up proceedings and
property disposal.
The company's liquidator is:
Alric Lindsay
Telephone: (345) 926 1688
c/o Artillery Court
Shedden Road
P.O. Box 11371, George Town
Grand Cayman KY1-1008
Cayman Islands
INUIT INVESTMENTS: Shareholders' Final Meeting Set for Aug. 15
--------------------------------------------------------------
The shareholders of Inuit Investments Ltd. will hold their final
meeting on Aug. 15, 2013, at 12:00 noon, to receive the
liquidator's report on the company's wind-up proceedings and
property disposal.
The company's liquidator is:
MBT Trustees Ltd.
Telephone: 945 8859
Facsimile: 949 9793/4
P.O. Box 30622 Grand Cayman KY1-1203
Cayman Islands
LANTERNE ARRAN: Shareholders' Final Meeting Set for Aug. 15
-----------------------------------------------------------
The shareholders of Lanterne Arran Feeder (Offshore) Fund will
hold their final meeting on Aug. 15, 2013, 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:
Mourant Ozannes Cayman Liquidators Limited
94 Solaris Avenue, Camana Bay
P.O. Box 1348 Grand Cayman KY1-1108
Cayman Islands
LANTERNE ARRAN MASTER: Shareholders' Final Meeting Set for Aug. 15
------------------------------------------------------------------
The shareholders of Lanterne Arran Master Fund will hold their
final meeting on Aug. 15, 2013, 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:
Mourant Ozannes Cayman Liquidators Limited
94 Solaris Avenue, Camana Bay
P.O. Box 1348 Grand Cayman KY1-1108
Cayman Islands
ORCHARD II: Members' Final Meeting Set for Aug. 12
--------------------------------------------------
The members of Orchard II, Inc. will hold their final meeting on
Aug. 12, 2013, to receive the liquidator's report on the company's
wind-up proceedings and property disposal.
The company's liquidator is:
CDL Company Ltd.
P.O. Box 31106
Grand Cayman KY1-1205
Cayman Islands
TT ASIAN: Shareholders' Final Meeting Set for Aug. 15
-----------------------------------------------------
The shareholders of TT Asian Opportunities Fund Limited will hold
their final meeting on Aug. 15, 2013, at 10:15 a.m., to receive
the liquidator's report on the company's wind-up proceedings and
property disposal.
The company's liquidator is:
Michael Penner
c/o Grant Hiley
Deloitte & Touche
Citrus Grove Building, 4th Floor
Goring Avenue, George Town KY1-1109
Cayman Islands
Telephone: +1 (345) 814 2353
Facsimile: +1 (345) 949 8258
TT ASIAN ALPHA: Shareholders' Final Meeting Set for Aug. 15
-----------------------------------------------------------
The shareholders of TT Asian Opportunities Alpha Fund Limited will
hold their final meeting on Aug. 15, 2013, 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:
Michael Penner
c/o Grant Hiley
Deloitte & Touche
Citrus Grove Building, 4th Floor
Goring Avenue, George Town KY1-1109
Cayman Islands
Telephone: +1 (345) 814 2353
Facsimile: +1 (345) 949 8258
TT FINANCIALS: Shareholders' Final Meeting Set for Aug. 15
----------------------------------------------------------
The shareholders of TT Financials Long Short Fund Limited will
hold their final meeting on Aug. 15, 2013, at 10:45 a.m., to
receive the liquidator's report on the company's wind-up
proceedings and property disposal.
The company's liquidator is:
Michael Penner
c/o Grant Hiley
Deloitte & Touche
Citrus Grove Building, 4th Floor
Goring Avenue, George Town KY1-1109
Cayman Islands
Telephone: +1 (345) 814 2353
Facsimile: +1 (345) 949 8258
USISSIMO LIMITED: Shareholders' Final Meeting Set for Aug. 30
-------------------------------------------------------------
The shareholders of Usissimo Limited will hold their final meeting
on Aug. 30, 2013, at 10:00 a.m., to receive the liquidators'
report on the company's wind-up proceedings and property disposal.
The company's liquidators are:
Stuart Brankin
Desmond Campbell
Telephone: (345) 949 5586
c/o Aston Corporate Managers, Ltd.
P.O. Box 1981 Grand Cayman, KY1-1104
Cayman Islands
XU JIA: Members' Final Meeting Set for Aug. 12
----------------------------------------------
The members of Xu Jia Hui Serviced Apartment Limited will hold
their final meeting on Aug. 12, 2013, to receive the liquidator's
report on the company's wind-up proceedings and property disposal.
The company's liquidator is:
CDL Company Ltd.
P.O. Box 31106
Grand Cayman KY1-1205
Cayman Islands
===================================
D O M I N I C A N R E P U B L I C
===================================
* DOMINICAN REPUBLIC: Haiti Lacks Political Will to Talk Openly
---------------------------------------------------------------
Dominican Today reports that Dominican Republic Industry and
Commerce minister Jose del Castillo on July 24 warned that Haitian
authorities lack the political will to discuss the two countries'
trade relation openly, the latest salvo in the trade spat pitting
the Hispaniola neighbors.
Jose del Castillo said Haiti's economic interests are the ones
behind the decisions on trade between the two countries, since in
his view Port-au-Prince doesn't have a firm position to hold a
dialogue, according to Dominican Today.
The report notes that the official said in the particular case of
the ban on plastics from Dominican Republic, Haitian officials
failed to comply with World Trade Organization protocols, proving
once again that they don't correspond to the way Dominicans treat
them.
Dominican Today discloses that interviewed on Channel Digital 15,
del Castillo called the new dispute stemming from Haiti's ban on
plastics used as food containers "deplorable," but acknowledged
its legitimate right to adopt the measure as a WTO member country.
===========
M E X I C O
===========
FIDEICOMISO MAQUINARIA: S&P Cuts Rating on US$160MM Notes to 'CC'
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on
Fideicomiso Maquinaria Especializada MXO Trust Agreement
No. F/00762's (Geo Maquinaria Trust's) US$160 million fixed-rate
secured notes series 2011 to 'CC (sf)' from 'CCC+ (sf)'. The
rating was also removed from CreditWatch with negative
implications, where S&P placed it on April 16, 2013. The issuance
is an asset-backed securities transaction secured by the rights of
the service agreement between Maquinaria Especializada MXO S.A. de
C.V. and Corporacion Geo S.A.B. de C.V. (Geo) and its
subsidiaries.
The rating action reflects S&P's opinion that the transaction
faces a high risk of nonpayment in the near-to-medium term. The
transaction benefits from a reserve account of approximately
US$25.6 million as of the last payment date in May 2013,
sufficient to cover the next quarterly interest and principal
payment obligations for approximately $3.7 million and $900,000,
respectively, due Aug. 2, 2013. However, Geo and its subsidiaries
have stopped making the scheduled payments under the service
agreement since the May 2013 payment date, and S&P do not expect
them to cover the August payment either, each for $11.23 million.
Geo and its subsidiaries play crucial roles as the sole obligors
of the issuing trust's transferred receivables and quarterly
payment obligations and, as described in the transaction's service
agreement, benefit from the issuing trust's provided machinery
availability services. As such, S&P generally views the rating on
the series 2011 notes as capped (weak-linked) to the rating on
Geo. Though Geo's issuer credit rating is currently 'D' because
the company defaulted on some of its direct financial obligations,
since the trust has continued to make principal and interest
payments and has sufficient liquidity in the form of cash reserves
to meet the next debt service payment under the series 2011 notes,
S&P now views the credit risk of the transaction as temporarily
de-linked from Geo's credit rating.
In addition to the reserve account, the transaction also benefits
from a capital expense account of $2.99 million as of May 2013,
and other accounts (general dollar, general peso, and tax
accounts), for a combined balance of approximately $12 million
that could be used to pay down the notes.
Also, the trust has security interest over the construction
equipment related to the service agreement that could be
liquidated to pay down the notes. Because these assets' timing
and liquidation values are uncertain, Standard & Poor's has not
factored them into its analysis since the rating was assigned and
in its subsequent rating actions. However, it is possible that
additional funds may be obtained this way.
Geo announced recently that it has reached a standstill agreement
with the majority of the series 2011 noteholders, under which the
latter will refrain from exercising their rights and remedies or
taking any enforcement action against Geo and its subsidiaries
until the agreement expires on Sept. 3, 2013, with some
exceptions. The transaction will continue to make the scheduled
interest and principal debt service payments using the reserve
account funds while the standstill remains. The standstill would
also expire if Geo is declared bankrupt, or concurso mercantil, or
if Geo breaches the terms of the standstill agreement.
Upon the standstill agreement's termination, the service agreement
would also terminate subject to certain conditions. At that time,
the controlling party could request the indenture trustee to
accelerate the notes, and the noteholders would also be entitled
to exercise an unsecured claim against Geo for an amount equal to
the notes' outstanding balance.
STANDARD & POOR'S 17G-7 DISCLOSURE REPORT
SEC Rule 17g-7 requires an NRSRO, for any report accompanying a
credit rating relating to an asset-backed security as defined in
the Rule, to include a description of the representations,
warranties and enforcement mechanisms available to investors and a
description of how they differ from the representations,
warranties and enforcement mechanisms in issuances of similar
securities. The Rule applies to in-scope securities initially
rated (including preliminary ratings) on or after Sept. 26, 2011.
If applicable, the Standard & Poor's 17g-7 Disclosure Report
included in this credit rating report is available at:
http://standardandpoorsdisclosure-17g7.com
MAXCOM TELECOMUNICACIONES: Files for Bankruptcy in the U.S.
-----------------------------------------------------------
Maxcom Telecomunicaciones, S.A.B. de C.V. on July 24 disclosed
that it commenced voluntary prepackaged Chapter 11 cases in the
U.S. Bankruptcy Court for the District of Delaware on July 23,
2013 to implement its previously announced recapitalization and
debt restructuring.
Under the Chapter 11 plan of reorganization, Maxcom will complete
a comprehensive recapitalization and debt restructuring that is
expected to significantly reduce Maxcom's debt service expense and
position Maxcom for growth with a US$45 million capital infusion.
As of the voting deadline of July 23, 2013, over 98 percent in
amount and over 93 percent in number of the holders of 11% Senior
Notes due 2014 that cast ballots voted to accept the Plan. These
preliminary results exceeds the amount required for the court to
approve the Plan, subject to final review and tabulation by GCG,
Inc., Maxcom's proposed notice, claims, and balloting agent.
The restructuring is not expected to adversely affect Maxcom's
customers, employees, or vendors. Throughout the restructuring,
Maxcom intends to continue business as usual. All
telecommunications services will continue without change or
interruption, and employees and vendors will be paid in the normal
course of business.
The Company expects to complete its restructuring, which is
subject to U.S. Bankruptcy Court approval and the conditions set
forth in the recapitalization agreement and the restructuring and
support agreement, within approximately 60 days and anticipates
emerging from Chapter 11 by early fall.
Previously Announced Recapitalization and Debt Restructuring
Maxcom, private equity firm Ventura Capital Privado, S.A. de C.V.,
an ad hoc group holding an aggregate amount of approximately US$86
million of Maxcom's Senior Notes, and certain of its current
equity holders have reached agreement on the terms of the
restructuring and support agreement, recapitalization agreement,
and agreements to tender. Pursuant to the recapitalization
agreement, Ventura and certain related parties have agreed to make
a capital contribution of US$45.0 million dollars and conduct a
tender offer to acquire for cash, at a price equal to Ps.$2.90
(two pesos and 90/100) per CPO, up to 100% (one hundred percent)
of the issued and outstanding shares of Maxcom, subject to the
terms of the recapitalization agreement. The Purchasers'
obligation to consummate the tender offer and make the capital
contribution is subject to a number of conditions, including:
receiving legal and regulatory approvals from the Mexican Banking
and Securities Commission (Comision Nacional Bancaria y de
Valores), the Mexican Ministry of Communications and
Transportation (Secretaria de Comunicaciones y Transportes), and
the Mexican Antitrust Commission (Comision Federal de
Competencia); the absence of certain material adverse effects; the
entry of an acceptable bankruptcy court confirmation order
consistent with the terms of the restructuring and support
agreement and the recapitalization agreement; and such order
becoming final.
Pursuant to the terms of the Plan that have been agreed to by
Maxcom, the Purchasers, and the Ad Hoc Group, all classes of
creditors are unimpaired and will be paid in full under the Plan,
except for the Senior Notes claims, which will receive (1) the
step-up senior notes (which include the capitalized interest
amount for unpaid interest accrued on the Senior Notes from (and
including) April 15, 2013 through (and excluding) June 15, 2013,
at the rate of 11% per annum), (2) cash in the amount of unpaid
interest accrued on the Senior Notes (A) from (and including)
December 15, 2012 through (and excluding) April 15, 2013, at the
rate of 11% per annum, and (B) from (and including) June 15, 2013
through (and excluding) the effective date of the Plan at the rate
of 6% per annum, and (3) rights to purchase equity that is
unsubscribed by the Company's current equity holders pursuant to
the terms of the Plan. The step-up senior notes will: (a) be
issued in an aggregate principal amount of US$200 million, minus
the amount of Senior Notes held in treasury by the Company, plus
the capitalized interest amount; (b) bear interest (i) from the
date of issuance until June 14, 2016, at the annual rate of 6% per
annum, (ii) from June 15, 2016 until June 14, 2018, at the annual
rate of 7% per annum, and (iii) from June 15, 2018 until the
maturity date, at the annual rate of 8% per annum; (c) have a
maturity date of June 15, 2020; (d) be secured by the same
collateral that currently secures the Senior Notes; and (e) be
unconditionally guaranteed, jointly and severally and on a senior
unsecured basis, by all of Maxcom's direct and indirect
subsidiaries, excluding Fundacion Maxcom, A.C.
As previously announced, the Company has engaged Lazard Freres &
Co. LLC and its alliance partner Alfaro, Davila y Rios, S.C. as
its financial advisor and Kirkland & Ellis LLP and Santamarina y
Steta, S.C. as its U.S. and Mexican legal advisors in connection
with its restructuring proceedings and potential Chapter 11 case.
The Ad Hoc Group has retained Cleary Gottlieb Steen & Hamilton LLP
and Cervantes Sainz, S.C., as its U.S. and Mexican legal advisors.
Ventura has retained VACE Partners as its financial advisor, and
Paul Hastings LLP and Jones Day as its U.S. and Mexican legal
advisors, respectively.
About Maxcom
Maxcom Telecomunicaciones, S.A.B. de C.V., headquartered in Mexico
City, Mexico, is a facilities-based telecommunications provider
using a "smart-build" approach to deliver last-mile connectivity
to micro, small and medium-sized businesses and residential
customers in the Mexican territory. Maxcom launched commercial
operations in May 1999 and is currently offering local, long
distance, data, value-added, paid TV and IP-based services on a
full basis in greater metropolitan Mexico City, Puebla, Tehuacan,
San Luis, and Queretaro, and on a selected basis in several cities
in Mexico.
In June 2013, Maxcom didn't make an $11 million interest payment
on the notes. At the time, the company said it would use the 30-
day grace period to negotiate a restructuring to be carried out
through a Chapter 11 filing in the U.S.
MAXCOM TELECOMUNICACIONES: Case Summary & 30 Top Unsec. Creditors
-----------------------------------------------------------------
Debtor-affiliates filing separate Chapter 11 petitions:
Debtor Name Case Number
----------- -----------
Maxcom Telecomunicaciones, S.A.B. de C.V. 13-11839
Guillermo Gonzalez Camarena
2000 Centro Ciudad,
Santa Fe, Mexico, D.F.
Sierra USA Communications, Inc. 13-11837
Maxcom U.S.A., Inc. 13-11838
Telscape de Mexico, S.A. de C.V. 13-11840
Outsourcing Operadora de Personal,
S.A. de C.V. 13-11841
Corporativo en Telecomunicaciones,
S.A. de C.V. 13-11842
Telereunion, S.A. de C.V. 13-11843
Maxcom Servicios Administrativos,
S.A. de C.V. 13-11844
Celmax Movil, S.A. de C.V. 13-11845
Maxcom SF, S.A. de C.V. 13-11846
Asesores Telcoop, S.A. de C.V. 13-11847
Servicios MSF, S.A. de C.V. 13-11848
Maxcom TV, S.A. de C.V. 13-11849
TECBTC Estrategias de Promocion,
S.A. de C.V. 13-11850
Sierra Comunicaciones Globales,
S.A. de C.V. 13-11851
Nature of Business: The Company is an integrated telecommunication
services operator providing widespread voice
and data services to residential and small-
and medium-sized business customers in four
metropolitan markets in Mexico and selected
service in other markets.
Chapter 11 Petition Date: July 23, 2013
Court: U.S. Bankruptcy Court
District of Delaware
Judge: The Honorable Peter J. Walsh
Debtors' Counsel: Laura Davis Jones Jones, Esq.
Timothy P. Cairns, Esq.
Peter J. Keane, Esq.
PACHULSKI STANG ZIEHL & JONES LLP
919 North Market Street, 17th Floor
P.O. Box 8705
Wilmington, DE 19899-8705
Telephone: (302) 652-4100
Facsimile: (302) 652-4400
Email: ljones@pszjlaw.com
tcairns@pszjlaw.com
pkeane@pszjlaw.com
- and -
Marc Kieselstein, P.C., Esq.
Adam Paul, Esq.
Daniel R. Hodgman, Esq.
KIRKLAND & ELLIS LLP
300 North LaSalle
Chicago, IL 60654
Telephone: (312) 862-2000
Facsimile: (312) 862-2200
Email: marc.kieselstein@kirkland.com
adam.paul@kirkland.com
daniel.hodgman@kirkland.com
Debtors' Mexican
Counsel: Santamarina y Steta, S.C.
Debtors' Financial
Advisor: Lazard Freres & Co. LLC
Debtors' Mexican
Financial Advisor: Alfaro, Davila y Rios, S.C.
Debtors' Claim &
Notice Agent and
Administrative
Agent: GCG, Inc.
Counsel to ad hoc
group of holders
of Debtors' 11%
senior notes
due 2014: David B. Stratton, Esq.
Evelyn J. Meltzer, Esq.
John H. Schanne II, Esq.
PEPPER HAMILTON LLP
Hercules Plaza, Suite 5100
1313 N. Market Street
P.O. Box 1709
Wilmington, DE 19899-1709
Telephone: (302) 777-6500
Facsimile: (302) 421-8390
E-mail: strattond@pepperlaw.com
meltzere@pepperlaw.com
schannej@pepperlaw.com
- and -
Emily A. Bussigel, Esq.
Lisa M. Schweitzer, Esq.
CLEARY GOTTLIEB STEEN & HAMILTON LLP
One Liberty Plaza
New York, NY 10006
Telephone: 212-225-2000
Facsimile: 212-225-3999
E-mail: lschweitzer@cgsh.com
ebussigel@cgsh.com
Total Assets as of May 29, 2013: $11,113,564,360
Total Liabilities as of May 29, 2013: $402,278,543
The petition was signed by Gonzalo Alarcon Iturbide, the Debtors'
general counsel.
A list of the Debtors' 30 Largest Unsecured Creditors:
Entity Nature of Claim Amount of Claim
------ --------------- ---------------
Radiomovil Dipsa Litigation $17,950,801.79
S.A. de C.V.
Lago Zurich 245
Edif Telcel Ampliacion Granada
11529 Ciudad de Mexico D.F.
Mexico
Tel: (55) 2581-3863
Fax: (55) 2581-3864
Email: rchavarr@mail.telcel.com
Autoarrendadora Integral Trade Claim $1,053,241.84
S.A. de C.V.
Negra Modelo 4A
Col. Industrial Alce Blanco
53370 Naucalpan de Juarez, MEX
Mexico
Tel: (55) 5322-4482
Fax: (55) 5322-4460
Email: amendoza@gruposumma.com.mx
Pegaso PCS S.A. de C.V. Trade Claim $1,052,970.35
Prolongacion Paseo
De La Reforma 1200 Piso
14, Col Cruz Manca
5349 Mexico, D.F.
Mexico
Tel: (55) 1616-8143
Fax: (55) 1616-5000
Email: pedro.sanjuan@telefonica.com
Tp-Link Technologies Trade Claim $709,815.60
de Mexico
Iglesia 2 Tone F 201,
Tizapan San Angel
1090 Ciudad de Mexico, D.F.
Mexico
Tel: (55) 2062-0193
Fax: N/A
Email: carlos.pedroza@tp-link.com
Telefonos De Mexico Trade Claim $497,486.25
S.A.B. de C.V.
Attn: Victor Manuel Pacheco Dirso
Parque Via 198, Col. Cuauhtemoc
6500 Ciudad de Mexico, D.F.
Mexico
Tel: (55) 5140-0692
Fax: (55) 5553-28900
Email: cvaron@telmex.com
Iusacell S.A. de C.V. Trade Claim $487,686.11
Montes Urales 460,
Col. Vista Hermosa
11000 Mexico D.F.
Mexico
Tel: (55) 5109-5259
Fax: (55) 5109-5772
Email: aruelas@iusacell.com.mx
Latino Communications Trade Claim $402,074.80
Corporation
5221 N. O'Connor Blvd,
Suite 850
Irving TX 75039
Tel: 0181-8254-30014
Fax: 97-2444-4554
Email: ljimenez@latcomm.net
Metro Net S.A. de C.V. Trade Claim $386,739.79
Michoacan 22, Col. Hipodromo
12200 Ciudad de Mexico, D.F.
Mexico
Tel: (55) 5063-8100
Fax: (55) 5574-8122
Email: guillermo.zarate@redit.com
Operbes S.A. de C.V. Trade Claim $381,110.76
A.V. Vasco de Quiroga 2000
Col. Santa Fe
1210 Ciudad de Mexico, D.F.
Mexico
Tel: (55) 4000-2968
Fax: N/A
Email: jcyanezb@bestel.com.mx
Shenzhen Guanri Telecom-Tech Trade Claim $339,356.34
3F Building R3-B High Tech
518057 Shenzhen
China
Tel: (86) 755-2652-0873
Fax: (86) 0755-2652-0885
Email: jeny_tangjw@hotmail.com
Hi-Fun de Mexico Trade Claim $277,986.50
S de R.L. de C.V.
Tlaxcala 25,
Col. Roma Sur
6760 Ciudad de Mexico, D.F.
Mexico
Tel: (55) 5109-1508
Fax: N/A
Email: rogerunidengmail.com
Operadora Unefon Trade Claim $268,330.59
S.A. de C.V.
Montes Urales 460
Lomas Dc Chapultepec
11000 Ciudad de Mexico, D.F.
Mexico
Tel: (55) 5109-5259
Fax: N/A
Email: aruelas@iusacell.com.mx
3M Mexico S.A. de C.V. Trade Claim $251,387.54
Email: framirezacosta@mmm.com
Ensambladora Telefonica Trade Claim $229,296.16
Email: msegura@intelmex.com.mx
Conductores Monterrey Trade Claim $217,983.95
S.A. de C.V.
Email: jesus.rodriguez@viakon.com
Alcatel-Lucent Mexico Trade Claim $217,092.15
S.A. de C.V.
Email: e.velazquez@alcatel-lucent.com
Tatung Technology Trade Claim $211,800.00
Incorporation
Email: cecile_hsieh@tti.tv
Soluciones de Vanguardia Trade Claim $207,597.05
S.A. de C.V.
Email: rdelgadosolvan.com.mx
Microsoft Licensing GP Trade Claim $187,313.74
Email: abacuc@microsoft.com
Microsoft Mexico Trade Claim $183,078.02
S de R.L. de C.V.
Email: palmazan@microsoft.com
Criteria de Mexico Trade Claim $162,423.48
S.A. de C.V.
Email: flecumberri@criteria.com.mx
Grupo Corgra S.A. de C.V. Trade Claim $150,063.23
Sistemes Integrats Cortes I Trade Claim $149,287.03
Email: emanuel.millan@sicamexico.com.mx
JAG Telecom S.A. de C.V. Trade Claim $142,213.68
Email: camachosuagmail.com
Gestion de Tecnologia Trade Claim $131,135.50
Especializada
Email: marlon.torres@getecsa.com.mx
Soporte Y Capacitacion Trade Claim $119,480.00
S.A. de C.V.
Email: mregaladosycnet.com.mx
ASPE Vigilancia Trade Claim $116,390.90
Y Proteccion Patrim
Email: aspe_seguridad.privadahotmail.com
Fox Sports Mexico Trade Claim $115,000.00
Distribution LLC
NEC de Mexico S.A. de C.V. Trade Claim $113,440.21
Email: fcolin@nec.com.mx
Fox Latin American Trade Claim $101,027.37
Channel Inc.
Email: diana.delgadofox.com
PLAYA RESORTS: Moody's Rates Proposed $350MM Term Loan '(P)B2'
--------------------------------------------------------------
Moody's Investors Service has assigned a (P)B2 rating to Playa
Resorts Holding, B.V.'s proposed $350 million senior secured term
loan and a (P)Caa1 rating to its proposed $300 million senior
unsecured global notes. At the same time, Moody's assigned a
provisional (P)B3 corporate family rating. The rating outlook is
stable. Moody's has assigned the ratings on a provisional basis
pending the successful closing of these transactions. This is the
first time Moody's has rated Playa.
Ratings Rationale:
Ratings assigned are:
- Corporate Family Rating of (P)B3
- $350 million senior secured term loan due 2019 rated (P)B2
- $300 million senior unsecured notes due 2020 rated (P)Caa1
The ratings reflect the company's small operating scale relative
to global industry peers and its low geographic and segment
diversification which makes it vulnerable to economic cycles. The
ratings also incorporate Playa's high execution risk coming from
the brand conversion and repositioning plan of most of its hotels
combined with its high capex requirement for the next three years
that should result in negative free cash flow generation. The
company's high leverage, operation in a highly cyclical industry
with intense competition, and no track record in the proposed
business configuration could affect Playa's ability to achieve its
growth plan and improve its margins and credit metrics.
The ratings also reflect the good quality of the properties in
Playa's portfolio, the company's experienced senior management
team, and Hyatt's participation as a shareholder. The access to
Hyatt's widely recognized brand name, distribution channels, and
loyalty program is a positive for Playa's positioning strategy and
growth given Hyatt's track record in the lodging industry. The
rating also reflects Playa's adequate liquidity profile with no
major near term debt maturities pro-forma for the proposed
financing.
The stable rating outlook reflects Moody's expectation that Playa
will be able to achieve its projected growth plan while improving
its operating and credit metrics. The outlook also reflects
Moody's expectation that the company will maintain adequate
liquidity.
Higher ratings would require that the company successfully
executes its brand conversion and repositioning plan such that its
operating margin increases above 13% and its credit metrics
improve with adjusted debt/EBITDA approaching to 6 times and
EBIT/interest expense above 1.5 times on a sustainable basis.
The ratings could be downgraded if the company's projected growth
plan is hampered, for example, by a weak macroeconomic environment
or a delay in its conversion plan, such that its profitability or
credit metrics deteriorate with operating margin declining below
10% or leverage (adj. debt/EBITDA) remaining above 6.5 times with
limited prospects for deleveraging.
The rating of the secured term loan is one notch above the
Corporate Family Rating (CFR) reflecting its collateral coverage
and lower expected loss relative to the unsecured debt. The rating
of the senior unsecured notes is one notch below the CFR
reflecting its effective subordination to the $350 million term
loan.
The principal methodology used in rating Playa was the Global
Lodging & Cruise Industry Methodology published in December 2010.
Based in Amsterdam, Playa Resorts Holding, B.V. is a wholly owned
subsidiary of Playa Hotels & Resorts, B.V. a hotel owner and
operator that through a leveraged finance transaction will acquire
some hotels in Mexico and the Caribbean. After the transaction
closes Playa will own and operate 13 hotels and 5,805 rooms
located in Mexico, Dominican Republic and Jamaica. The transaction
cost of around $1.4 billion will be financed through an equity
injection of $786 million (including $325 million from Hyatt and
$411 million from Playa current owners) and $650 million in debt.
The company will operate under an all-inclusive format through
Hyatt, Playa and AMResorts which focus in the upscale lodging
segment.
QUALITAS CONTROLADORA: S&P Assigns 'BB' Rating; Outlook Stable
--------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB' long-term
counterparty credit rating (ICR) on Qualitas Controladora S.A.B.
de C.V. (QualCon). The outlook is stable.
"Our ratings on QualCon follow our group rating methodology and
standard notching for non-U.S., non-operating holding companies
(NOHC). As a result, the ICR on QualCon is two notches below
rating on its core operating company, considering the insurance
group has no banking and/or material non-regulated businesses.
The ICR on QualCon reflects the group credit profile (GCP) and the
number of notches that differentiate the NOHC from the operating
entities. The rating differential incorporates the ongoing
subordination of QualCon's creditors to those of Qualitas (its
policyholders). QualCon's GCP is based on our ratings on Qualitas
(mxAA/Stable/mxA-1+)," S&P said.
"The ratings on Qualitas reflect our view of its "satisfactory"
business risk profile and "lower adequate" financial risk profile,
based on "adequate" business position and "upper adequate" capital
and earnings," S&P added.
QUINTANA ROO: Poor Performance Cues Moody's to Cut Ratings to B3
----------------------------------------------------------------
Moody's de Mexico downgraded the issuer ratings of the state of
Quintana Roo to B1.mx from Baa2.mx (Mexico National Scale) and to
B3 from B1 (Global Scale, local currency). At the same time,
Moody's placed the ratings under review for possible further
downgrade.
Ratings Rationale:
The downgrade of the issuer ratings reflects the very poor
financial performance that the state of Quintana Roo registered in
2012 and Moody's expectation that such performance will continue
during 2013. This includes: 1) the recording of sizable
consolidated fiscal deficits (-23.7% of total revenues in 2012);
2) very high debt levels that will continue to increase during
2013; and 3) a structurally weak and deteriorating liquidity
position.
The state of Quintana Roo has posted cash financing requirements
equivalent to -22.4% of total revenues, on average, during the
past three years. Such deficits result from the state's high
current expenditures, namely in social programs, transfers to
state entities and capital expenditures.
As a result, Quintana Roo's net working capital (current assets
less current liabilities) deteriorated rapidly to reach -21.3% of
total expenditures at the end of 2012 from -3.2% in 2011. This
deterioration reflects an increase in payables and a growing
short-term debt.
Moreover, Quintana Roo's net direct and indirect debt reached
68.5% of total revenues in 2012, a very high level which is well
above the median for the Mexican states that Moody's rates. In
2012, Quintana Roo contracted about MXN 3 billion in new debt, of
which only MXN 243 million was long-term debt and the rest was
short-term debt scheduled to mature in August 2013. Although debt
service as a percentage of total revenues has remained relatively
low at 6.9%, Moody's notes that the state has benefited from grace
periods that will expire in 2014. In 2013, Moody's estimates that
debt service will increase to 19% reflecting short-term debt
payment, a very high level.
In July 2013, the State Congress authorized the state to contract
up to MXN 5 billion to refinance the outstanding short-term debt
and undertake additional capital expenditures. As a result,
Moody's anticipates that Quintana Roo's debt ratio will reach 80%
of total revenues at the end of 2013. Given current expenditure
trends, Moody's anticipates that the state's debt level is likely
to further deteriorate in 2014.
Moody's placed the ratings under review for a possible downgrade
because of the prevailing uncertainty around Quintana Roo's
success in refinancing MXN 2.8 billion of short-term debt coming
due in August due to: 1) the state's very high debt levels, 2) the
very high percentage (71%) of participation revenues that the
state has already pledged to service its debt, and 3) acceleration
risks arising from Quintana Roo's lack of compliance with fiscal
and debt metrics contained in some of the state's loan contracts.
Moody's expects to conclude the review within the next two weeks.
Throughout this period, Moody's will need detailed and timely
information to enable it to monitor the state's progress in
securing its short-term debt refinancing. In addition, the rating
agency will examine the additional debt service resulting from its
new loans (i.e., the aforementioned short-term loans and new
debt). If the information is not received, one possible outcome of
the review is the withdrawal of the state's ratings due to
insufficient information.
What Could Change The Rating Up/Down
If Quintana Roo refinances its short-term debt favorably without
material increase in its financial burden, Moody's could confirm
the ratings at the current levels. If Quintana Roo fails to repay
its short-term debt on a timely basis or if the triggering of the
acceleration clauses lead to heightened liquidity pressures, the
ratings could be further downgraded, potentially by several
notches.
The principal methodology used in this rating was Regional and
Local Governments published in January 2013.
Moody's National Scale Ratings (NSRs) are intended as relative
measures of creditworthiness among debt issues and issuers within
a country, enabling market participants to better differentiate
relative risks. NSRs differ from Moody's global scale ratings in
that they are not globally comparable with the full universe of
Moody's rated entities, but only with NSRs for other rated debt
issues and issuers within the same country. NSRs are designated by
a ".nn" country modifier signifying the relevant country, as in
".mx" for Mexico.
===============================
T R I N I D A D & T O B A G O
===============================
CL FINANCIAL: Rowley Wants 'Transparent' Deal On Assets
-------------------------------------------------------
Trinidad Express reports that opposition Leader Dr. Keith Rowley
warned the government against any "under the table" deals in any
disposal of assets within the CL Financial portfolio.
"Such disposal should be done openly and transparently, getting
the best price on the open market. . . . It must stand full public
scrutiny," Trinidad Express quoted Dr. Rowley as saying.
"We are aware that there are initiatives in place to cherry pick
certain assets and such interests are prepared to pander to the
Government so that the Government would initiate one of its
outrageous decisions which would result in the loss of public
assets. . . . I refer specifically to the Angostura shares," he
added, according to Trinidad Express.
The report notes that Dr. Rowley said he was putting the
Government on notice that the Opposition was aware that there were
local interests which were looking to the Government for
"sweetheart deals" over the Angostura shares.
"We would be monitoring that and we would hope that we do not have
to report another Government mishandling of public resources," Dr.
Rowley said, the report relays.
The report relates that Dr. Rowley said any arrangement which is
to replace the initial shareholders' agreement should be one where
the Government's input is properly collateralized and a proper
repayment schedule be put in place with safeguards for the public
monies. "That is possible and that is a requirement," he said,
the report notes.
The report discloses that Dr. Rowley said it should be now clear
that the bailout which took place with public monies was against
the background of the company having assets in its portfolio which
could provide a revenue stream to repay the bailout money.
Dr. Rowley said for three years the country had listened to
Government spokespersons, including Ministers of the Finance,
talking about the wasting of public monies and the monies paid in
the bailout were lost or wasted, Trinidad Express notes.
Trinidad Express relays Dr. Rowley said what happened was that the
bailout was required to stabilize the economy and that the asset
base of the company over time and with good management have been
now shown to be able to service a loan portfolio that is servicing
the bailout money.
Trinidad Express adds that the Government and CL Financial are in
negotiation for a new agreement which would allow Government to
recover the sums pumped into the conglomerate over the past four
and a half years.
That sum is estimated to be $23.3 billion.
About CL Financial
CL Financial Group Limited is a privately held conglomerate in
Trinidad and Tobago. Founded as an insurance company by Cyril
Duprey, Colonial Life Insurance Company 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 TCR-LA 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 X
=================
* Moody's Notes Weak ABS SME Performance in EMEA Sectors
--------------------------------------------------------
The performance of asset-backed securities backed by loans to
small and medium enterprises (ABS SME) and lease securitization
transactions in Europe, the Middle East and Africa (EMEA) was
still weak in May 2013, according to the latest indices published
by Moody's Investors Service.
The 90-360 days delinquency rate decreased slightly to 3.07% in
May 2013 from 3.19% in May 2012, and fell from 4.73% in December
2012. This decrease can be observed across the biggest markets in
the index, Italy and Spain.
Although delinquencies are improving, cumulative defaults and the
90+ cumulative delinquencies ratio deteriorated to 5.11% in May
2013 from 3.82% in May 2012, with the weakest markets being Italy
and Spain. Cumulative defaults in Italy increased to 6.47% from
4.97%, while in Spain cumulative 90+ delinquencies (a proxy used
for defaults) rose to 9.67% from 7.92%. Both figures exceed the
average for the Index.
Moody's outlook for German SME is stable and remains negative for
Spanish and Italian SME ("European ABS and RMBS: 2013 Outlook",
December 10, 2012). Moody's forecasts that Portugal, Spain and
Italy will remain in economic recession in 2013 ("Update to Global
Macro Outlook 2013-14: Loss of Momentum", May 13, 2013). The
rating agency expects that Spanish GDP will decrease 1.40% in 2013
and the unemployment rate will rise to 27.40% (Country Statistics:
Government of Spain, June 3, 2013).
The total outstanding pool balance of EMEA ABS SME transaction
rated by Moody's stood at EUR 93.8 billion in May 2013, compared
to EUR 131.5 billion in May 2012. This decrease can be observed
across nearly all EMEA markets. Only the total pool balance of
Italy increased to EUR 23.6 billion from EUR 16.8 billion over the
same period of time.
In the first half of 2013, Moody's rated three new transactions,
which comprised two Spanish transactions (IM Grupo Banco Popular
Empresas V, FTA and FTA PYMES SANTANDER 5) and one Italian (BPL
Mortgages S.r.l. SME) transaction.
***********
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., Washington, D.C.,
USA, Marites O. Claro, Joy A. Agravante, Rousel Elaine T.
Fernandez, Valerie U. Pascual, Julie Anne L. Toledo, Frauline S.
Abangan, and Peter A. Chapman, Editors.
Copyright 2013. 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$775 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 Peter A. Chapman at 215-945-7000 or Nina Novak at
202-241-8200.
* * * End of Transmission * * *