/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/140515.mbx T R O U B L E D C O M P A N Y R E P O R T E R L A T I N A M E R I C A Thursday, May 15, 2014, Vol. 15, No. 95 Headlines A R G E N T I N A ARGENTINA: JPMorgan Paying $2BB More for Bonds From Repsol FIDEICOMISO FINANCIERO: Moody's Rates ARS22.2MM Certs. 'Ba1.ar' B R A Z I L BANCO BMG: S&P Puts 'B/B' Rating on CreditWatch Developing COMPANHIA ENERGETICA: S&P Raises CCR to 'BBB-' from 'BB+' HYPERMARCAS: S&P Raises CCR to 'BB'; Outlook Stable OGX PETROLEO: Batista Appeals Court Order Freezing $55MM Cash C A Y M A N I S L A N D S AL JEMAIL: Shareholder to Receive Wind-Up Report on June 13 ASIA EQUITY: Members' Final Meeting Set for June 19 BLUEBAY MULTI-SELECT: Commences Liquidation Proceedings COMNET COMPANY: Creditors' Proofs of Debt Due May 27 CONOCOPHILLIPS KAZAKHSTAN: Shareholders' Meeting Set for June 3 DRAX INTERMEDIATE: Commences Liquidation Proceedings DRAX LIMITED: Commences Liquidation Proceedings KHALID MOHAMMED: Members' Final Meeting Set for May 30 NE ASIA MASTER: Shareholders' Final Meeting Set for June 20 NE ASIA OFFSHORE: Shareholders' Final Meeting Set for June 20 SANTA RAFAELA: Shareholder to Receive Wind-Up Report on June 18 SANTA ROSANNA: Shareholder to Receive Wind-Up Report on June 18 STW INTERNATIONAL: Shareholders' Final Meeting Set for May 27 WATER BEARER: Creditors' Proofs of Debt Due May 26 C O L O M B I A PACIFIC RUBIALES: S&P Affirms 'BB+' CCR; Outlook Stable D O M I N I C A N R E P U B L I C BANCO BHD: IFC to Help Bank Develop Innovative Products XSTRATA PLC: Official's Statement Buoys Mine Plan * DOMINICAN REPUBLIC: Majority Thinks Economy on Right Path M E X I C O GRUPO SENDA: Fitch Affirms 'B' IDR; Outlook Stable - - - - - ================= A R G E N T I N A ================= ARGENTINA: JPMorgan Paying $2BB More for Bonds From Repsol ---------------------------------------------------------- Brendan Walsh at Bloomberg News reports that JPMorgan Chase & Co. (JPM) agreed to buy Argentine government bonds from oil producer Repsol SA (REP) for $2 billion, bringing its purchases of the country's securities to about $5 billion in the past week. JPMorgan agreed to purchase Argentina's bonds due in 2015, 2017 and 2033, Madrid-based Repsol said in a filing, according to Bloomberg News. The oil company agreed to sell Argentine bonds due in 2024 to New York-based JPMorgan for $2.8 billion. The biggest U.S. bank is facilitating Repsol's efforts to reduce ties with the Argentine government, which nationalized its 51 percent stake in local oil producer YPF SA in April 2012, the report notes. Under an agreement reached with the government earlier this year, Repsol received a face value of $5.32 billion of bonds as compensation for the seizure, the report relates. JPMorgan has now bought almost all of that. The bank, which has already sold some of the Argentine bonds received from the first purchase, is wagering that the remaining holdings will gain in value, a person with direct knowledge of the bank's strategy said, the report notes. Argentina's bonds, rated seven levels below investment grade, have soared 46 percent in the past year, the most among emerging-market government debt, as the country took steps to repair ties with international investors, including Repsol and the International Monetary Fund, the report discloses. Riskiest Debt Bloomberg News notes that the country's debt is still considered risky, with the cost of protection in the credit-default swaps market at 1,571 basis points according to CMA, the highest in the world. The country hasn't sold bonds directly to international markets since a $95 billion default in 2001, and it's locked in a dispute with some creditors in a case now before the U.S. Supreme Court, Bloomberg News relates. The transaction disclosed is expected to be completed by May 16, according to the filing. The sale included all of Repsol's Argentine securities due in 2017 and 2033 and all but $117 million of those due in 2015, according to the filing, Bloomberg News says. Repsol previously had said it had $500 million of the 2017 securities, $1.25 billion of the 2033 bonds and $317 million of the 2015 debt, Bloomberg New adds. FIDEICOMISO FINANCIERO: Moody's Rates ARS22.2MM Certs. 'Ba1.ar' --------------------------------------------------------------- Moody's Latin America Agente de Calificacion de Riesgo rates the new structure of Fideicomiso Financiero ICBC Prendarios I, a transaction that will be issued by TMF Trust (Argentina) S.A. - acting solely in its capacity as Issuer and Trustee. The securities for this transaction have not yet been placed in the market. Moreover, the transaction is pending approval from the "Comision Nacional de Valores." If any assumption or factor Moody's considers when assigning the ratings change before closing, the ratings may also change. The liability structure of the transaction has changed before issuance. The interest rate caps and floors of the debt securities were increased compared to the structure originally rated, and the closing date of the transaction has been postponed. Moody's has affirmed the ratings of the Class A Floating Rate Securities, Class B Floating Rate Securities and of the Certificates, previously assigned on April 9, 2014: ARS 157,176,089 in Class A Floating Rate Debt Securities of "Fideicomiso Financiero ICBC Prendarios I", rated Aa2.ar (sf) (Argentine National Scale) and B1 (sf) (Global Scale, Local Currency) ARS 22,165,859 in Class B Floating Rate Debt Securities of "Fideicomiso Financiero ICBC Prendarios I", rated Aa3.ar (sf) (Argentine National Scale) and B2 (sf) (Global Scale, Local Currency) ARS 22,165,859 in Certificates of "Fideicomiso Financiero ICBC Prendarios I", rated Ba1.ar (sf) (Argentine National Scale) and Caa1 (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 8,956 eligible auto loans denominated in Argentine pesos, with a fixed interest rate, originated by the Industrial and Commercial Bank of China (Argentina) S.A. "ICBC (Argentina)", in an aggregate amount of ARS 201,507,807. These auto loans are granted to ICBC (Argentina) clients. The monthly loan installment is deducted directly from the borrower's bank account. Overall credit enhancement is comprised of 22% of subordination for the Class A Floating Rate Debt Securities and 11% for the Class B Floating Rate Debt Securities. In addition the transaction has various reserve funds and excess spread. The VDF TVA will bear a BADLAR floating interest rate plus a spread. The VDF TVA's interest rate will never be higher than 32% or lower than 24%. The VDF TVB will also bear a BADLAR floating interest rate plus a spread. The VDF TVB's interest rate will never be higher than 34% or lower than 25% Factors that would lead to an upgrade or downgrade of the rating: Factors that may lead to a downgrade of the ratings include an increase in delinquency levels beyond the level Moody's assumed when rating this transaction. Factors that may lead to an upgrade of the ratings include the building of credit enhancement over time due to the turbo sequential payment structure, when compared with the level of projected losses in the securitized pool. Loss and Cash Flow Analysis: 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 ICBC (Argentina)'s portfolio. In addition, Moody's considered factors common to auto loans securitizations such as delinquencies, LTVs, 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 in order to determine the expected loss for the rated securities. In assigning the rating to this transaction, Moody's assumed a lognormal distribution for defaults on the pool with a mean of 4% and a coefficient of variation of 50%. Also, Moody's assumed a lognormal distribution for prepayments with a mean of 15% and a coefficient of variation of 70%. These assumptions are derived from the historical performance to date of ICBC (Argentina)'s pools. Servicer default was modeled by simulating the default of the ICBC (Argentina) as the servicer consistent with its current rating of B1/Aa2.ar. In the scenarios where the servicer defaults, Moody's assumed that the defaults on the pool would increase by 20 percentage points. The model results showed 0.00% expected loss for the Class A Floating Rate Debt Securities, 4.54% for the Class B Floating Rate Debt Securities and 9.62% for the Certificates. Finally, Moody's also evaluated the back-up servicing arrangements in the transaction. If ICBC (Argentina) is removed as servicer, TMF Trust Company (Argentina) S.A. will be appointed as the back- up servicer. Stress Scenarios: Moody's ran several stress scenarios, including increases in the default rate assumptions. If default rates increased 4% from the base case scenario for the pool (i.e., mean of 8% and a coefficient of variation of 50%), the ratings of the Class B Floating Rate debt securities and the Certificates would likely be downgraded to B3 (sf) and Caa3 (sf) respectively. The ratings of the Class A Floating Rate Debt Securities would likely be unchanged. The principal methodology used in this rating was "Moody's Approach to Rating Auto Loan-Backed ABS " published in May 2013. Potential Mapping Recalibration From Global Scale To National Scale Ratings With the recent downgrade of the government of Argentina on the global rating scale and other issuers whose risk profiles are affected by related credit considerations, the distribution of ratings among issuers in Argentina has become compressed within the bottom half of the national rating scale. As a result, the current mapping of global scale ratings to national scale ratings may no longer be adequately serving one of its intended purposes, which is to provide substantially greater potential credit differentiation among issuers in Argentina than is possible on the global rating scale. Moody's is therefore assessing the opportunity to revise its mapping from global scale ratings to national scale ratings for Argentina. If the mapping is revised, the new scale would likely imply that higher rated Argentine issuers would be remapped to higher ratings on the national scale. =========== B R A Z I L =========== BANCO BMG: S&P Puts 'B/B' Rating on CreditWatch Developing ---------------------------------------------------------- Standard & Poor's Ratings Services placed its 'B/B' global scale and 'brBBB-' national scale ratings on Banco BMG S.A. (BMG) on CreditWatch developing. "The rating action follows BMG's and Itau Unibanco S.A.'s April 29, 2014, announcement that they will redirect 100% of BMG's payroll discounted loans portfolio to the Banco Itau BMG Consignado S.A., concentrating all originations from this market into it," said Standard & Poor's credit analyst Edgard Dias. If regulators approve the transaction, BMG will sell its entire payroll discount loan portfolio to the JV without recourse, concentrating the portfolio's origination accounting and commercial structure into the JV. Itau's control in the JV will drop to 60% from 70%, as BMG increases its share to 40% following its pending capital injection into the JV. BMG will maintain a substantial foothold in the payroll discounted loan business, although all income from this portfolio will be through equity results at the JV. Since Itau enjoys one of the cheapest funding structures in the Brazilian market, the loans transferred to the JV have better profitability than those at BMG given the funding cost differences between the two banks. At the same time, Itau will discontinue a monthly Brazilian real (R$) 300 million funding facility it provided to BMG. By transferring control of payroll discounted loans originations to the JV, BMG will focus on SMEs, credit cards, and auto lending growth, markets in which the bank has significant experience. However, the shift will require significant guarantees control and skilled underwriting standards, as these segments pose risks due to their weaker overall asset quality and higher margins. S&P will resolve the CreditWatch listing when and if the Brazilian regulators approve or reject the transaction. S&P revised the anchor for banks operating in Brazil to 'bbb-' from 'bbb'. Therefore, if the regulator approves the changes in the JV, S&P could raise, affirm, or lower the ratings on BMG, following its analysis of the effects of the anchor revision on the ratings on the bank. If the bank materially changes its capitalization, business position, and funding and liquidity, this could offset the impact of the anchor revision. S&P could downgrade the bank if regulators reject the transaction because its recent anchor revision could negatively affect the ratings on the bank. COMPANHIA ENERGETICA: S&P Raises CCR to 'BBB-' from 'BB+' --------------------------------------------------------- Standard & Poor's Ratings Services raised its global scale corporate credit rating on CESP - Companhia Energetica de Sao Paulo (CESP) to 'BBB-' from 'BB+'. S&P also raised its Brazil national scale rating to 'brAAA' from 'brAA+'. The outlook is stable. At the same time, S&P raised CESP's stand-alone credit profile (SACP) to 'bbb-' from 'bb+'. "The upgrade reflects our expectation that CESP will continue amortizing its existing debt given its strong free operating cash flow generation in the next few years," said Standard & Poor's credit analyst Vinicius Fereira. The ratings on CESP reflect its 'bbb-' SACP, and S&P's assessment of a "low" likelihood of the state of Sao Paulo (global scale: BBB-/Stable/--; Brazil national scale: brAAA/Stable/--) to provide timely and sufficient support to CESP, if needed. The company is a government-related entity (GRE) and S&P based its view of the "low" likelihood of government support on: -- CESP's "limited" link to the state of Sao Paulo, as the state attempted to divest itself from the company in 2008. The uncertainties regarding CESP's concessions at the time undermined the state's efforts; and -- The company's "limited importance" role for the state, given the nature of the power generation in Brazil (where private and public entities produce energy) and a reduction in CESP's overall production capacity following the expiration of two of CESP's concessions in 2015. Companies in the Brazilian electric power generation segment that participate in auctions organized by the regulator, ANEEL, face a price ceiling when selling to the captive market. In the free market, prices are determined by what clients and companies are willing to pay. If a power company does not have contracts, it can sell its assured energy in the spot market; hydrology is the main driver of prices in this market. Unlike the distribution and transmission segments, generators do not benefit from tariff regulation that are typically designed at a minimum to ensure cost recovery and some level of profit. This results in a "moderately high" industry risk assessment. HYPERMARCAS: S&P Raises CCR to 'BB'; Outlook Stable --------------------------------------------------- Standard & Poor's Ratings Services raised its global scale corporate credit and debt ratings on Hypermarcas S.A. to 'BB' from 'BB-' and its national scale corporate credit and debt ratings to 'brAA-' from 'brA'. The outlook on both scales is stable. The upgrade reflects Hypermarcas' improving operating efficiency and profitability through the consolidation of its industrial plants and restructured operations following a period of several large acquisitions. The company has also reduced its foreign currency exposure through the repurchase of part of its bonds by the end of 2013. These improvements have translated into higher cash flow generation and, as a result, lower leverage metrics. OGX PETROLEO: Batista Appeals Court Order Freezing $55MM Cash ------------------------------------------------------------- Luciana Magalhaes at Daily Bankruptcy Review reports that Brazilian businessman Eike Batista on May 12 filed to appeal a court order freezing about $55 million of his cash, according to a federal judge in Rio de Janeiro. To unfreeze his account, the businessman will need to prove the money in it came from a legitimate source, said federal judge Flavio Roberto de Souza, in an interview with Daily Bankruptcy Review. Luciana Magalhaes, writing for The Wall Street Journal, reported on May 9 that Brazilian public prosecutors are examining whether, between May and June last year, Mr. Batista sold shares in his oil company, Oleo e Gas Participacoes SA before damaging information became public, according to the document. According to the report, the prosecutors believe that Mr. Batista knew that there were doubts about the economic viability of three oil fields: Tubarao Tigre, Tubarao Gato and Tubarao Areia. Before that information became public, he sold 126 million OGX shares earning BRL197 million, the report added, citing court documents. Had Mr. Batista waited until after the news became public, Mr. Batista would have earned a maximum of BRL73.5 million, according to the court document, WSJ discloses. The former billionaire denied any wrongdoing and said he intends to appeal the decision, reports WSJ. Mr. Batista said all his sales of shares were properly registered. As reported in the Troubled Company Reporter-Latin America on May 13, 2014, the Daily Bankruptcy News said that Mr. Batista confirmed that a Brazilian court has frozen part of his assets, following a request by prosecutors in Rio de Janeiro state. The report said that prosecutors in Rio de Janeiro state have asked a Brazilian court to freeze the assets of businessman Eike Batista as a precautionary measure, a spokesman for the public prosecutors said. Daily Bankruptcy Review said that Brazilian entrepreneur Eike Batista said he isn't concerned about a reported criminal investigation into the collapse of his once-highflying oil company. Reuters said that Brazil's federal police have opened an investigation into former billionaire Eike Batista for financial crimes, including insider trading, manipulation of markets and money laundering, Brazilian media reported. If the police probe leads to criminal charges against Mr. Batista, it would be yet another major blow for a businessman once hailed as Brazil's model entrepreneur and symbol of its economic success, according to Reuters. Mr. Batista's EBX oil, mining and logistics empire, which two years ago was valued at US$60 billion, collapsed last year in a mountain of debt and massive filings for bankruptcy protection, Reuters noted. Brazil's securities commission, CVM, announced that Mr. Batista was under investigation for insider trading as chairman of his now-bankrupt oil-producing company Oleo and Gas Participacoes SA, formerly known as OGX, and its sister company, shipbuilder OSX Brasil SA, Reuters disclosed. The police probe will focus on the sale of shares last year in oil producer OGX before the company informed the market that much of its reserves were not commercially viable, Folha de S. Paulo newspaper said, Reuters related. About OGX Petroleo Based in Rio de Janeiro, Brazil, OGX Petroleo e Gas Participacoes S.A., now known as Oleo e Gas, is an independent exploration and production company with operations in Latin America. OGX filed for bankruptcy in a business tribunal in Rio de Janeiro on Oct. 30, 2013, case number 0377620-56.2013.8.19.0001. The bankruptcy filing puts $3.6 billion of dollar bonds into default in the largest corporate debt debacle on record in Latin America. The filing by the oil company that transformed Eike Batista into Brazil's richest man followed a 16-month decline that wiped out more than $30 billion of his personal fortune. The filing, which in Brazil is called a judicial recovery, follows months of negotiations to restructure the dollar bonds, in which OGX sought to convert debt to equity and secure as much as $500 million in new funds. OGX said Oct. 29 that the talks concluded without an agreement. The company's cash fell to about $82 million at the end of September, not enough to sustain operations further than December. ========================== C A Y M A N I S L A N D S ========================== AL JEMAIL: Shareholder to Receive Wind-Up Report on June 13 ----------------------------------------------------------- The shareholder of Al Jemail Leasing Limited will receive on June 13, 2014, at 8:30 a.m., the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Intertrust SPV (Cayman) Limited 190 Elgin Avenue, George Town Grand Cayman KY1-9005 Cayman Islands c/o Kim Charaman/Jennifer Chailler Telephone: (345) 943-3100 ASIA EQUITY: Members' Final Meeting Set for June 19 --------------------------------------------------- The members of Asia Equity Partners Limited will hold their final meeting on June 19, 2014, at 4:00 p.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: DMS Corporate Services Ltd. c/o Nicola Cowan Telephone: (345) 946 7665 Facsimile: (345) 949 2877 dms House, 2nd Floor P.O. Box 1344 Grand Cayman KY1-1108 Cayman Islands BLUEBAY MULTI-SELECT: Commences Liquidation Proceedings ------------------------------------------------------- On April 25, 2014, the shareholders of The Bluebay Multi-Select Fund Limited resolved to voluntarily liquidate the company's business. Creditors are required to file their proofs of debt to be included in the company's dividend distribution. The company's liquidator is: Russell Smith c/o Derek Larner Telephone: (345) 815 4555 e-mail: dlarner@bdo.ky BDO CRI (Cayman) Ltd. Governors Square, Floor 2 - Building 3 23 Lime Tree Bay Ave P.O. Box 31229 Grand Cayman KY1 1205 Cayman Islands COMNET COMPANY: Creditors' Proofs of Debt Due May 27 ---------------------------------------------------- The creditors of Comnet Company Limited are required to file their proofs of debt by May 27, 2014, to be included in the company's dividend distribution. The company commenced wind-up proceedings on April 25, 2014. The company's liquidator is: Miu, Te-Tse 5th Floor No.15, Lane360, Sec.1, Neihu Rd. Taipei Taiwan, R.O.C. Telephone: 02-26571088 Facsimile: 02-26598577 CONOCOPHILLIPS KAZAKHSTAN: Shareholders' Meeting Set for June 3 --------------------------------------------------------------- The shareholders of Conocophillips Kazakhstan Ventures Ltd. will hold their final meeting on June 3, 2014, 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: Trident Liquidators (Cayman) Limited c/o Mrs. Eva Moore Trident Trust Company (Cayman) Limited Telephone: (345) 949 0880 Facsimile: (345) 949 0881 P.O. Box 847, George Town Grand Cayman KY1-1103 Cayman Islands DRAX INTERMEDIATE: Commences Liquidation Proceedings ---------------------------------------------------- On April 29, 2014, the shareholder of Drax Intermediate Holdings Limited resolved to voluntarily liquidate the company's business. Creditors are required to file their proofs of debt to be included in the company's dividend distribution. The company's liquidator is: Michael Iain Scott c/o Drax Power Station Selby, North Yorkshire YO8 8PH England Telephone: +1 (345) 914 6365 DRAX LIMITED: Commences Liquidation Proceedings ----------------------------------------------- On April 29, 2014, the shareholder of Drax Limited resolved to voluntarily liquidate the company's business. Creditors are required to file their proofs of debt to be included in the company's dividend distribution. The company's liquidator is: Michael Iain Scott c/o Drax Power Station Selby, North Yorkshire YO8 8PH England Telephone: +1 (345) 914 6365 KHALID MOHAMMED: Members' Final Meeting Set for May 30 ------------------------------------------------------ The members of Khalid Mohammed Salim Al Enazi Company LLC will hold their final meeting on May 30, 2014, to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Tarek M. Galal Amer c/o Maples and Calder, Attorneys-at-law PO Box 309, Ugland House Grand Cayman KY1-1104 Cayman Islands NE ASIA MASTER: Shareholders' Final Meeting Set for June 20 ----------------------------------------------------------- The shareholders of NE Asia Value Master Fund, Ltd will hold their final meeting on June 20, 2014, to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Commerce Corporate Services Limited P.O. Box 694 Grand Cayman Cayman Islands Telephone: 949 8666 Facsimile: 949 0626 NE ASIA OFFSHORE: Shareholders' Final Meeting Set for June 20 ------------------------------------------------------------- The shareholders of NE Asia Value Offshore Partners, Ltd will hold their final meeting on June 20, 2014, to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Commerce Corporate Services Limited P.O. Box 694 Grand Cayman Cayman Islands Telephone: 949 8666 Facsimile: 949 0626 SANTA RAFAELA: Shareholder to Receive Wind-Up Report on June 18 --------------------------------------------------------------- The shareholder of Santa Rafaela Shipping Company Limited will receive on June 18, 2014, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Commerce Corporate Services Limited P.O. Box 694 Grand Cayman Cayman Islands Telephone: 949 8666 Facsimile: 949 0626 SANTA ROSANNA: Shareholder to Receive Wind-Up Report on June 18 --------------------------------------------------------------- The shareholder of Santa Rosanna Shipping Company Limited will receive on June 18, 2014, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Commerce Corporate Services Limited P.O. Box 694 Grand Cayman Cayman Islands Telephone: 949 8666 Facsimile: 949 0626 STW INTERNATIONAL: Shareholders' Final Meeting Set for May 27 ------------------------------------------------------------- The shareholders of STW International Ltd. will hold their final meeting on May 27, 2014, 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: Richard Fear c/o Daniel Woolston Telephone: (345) 814 7782 Facsimile: (345) 945 3902 P.O. Box 2681 Grand Cayman KY1-1111 Cayman Islands WATER BEARER: Creditors' Proofs of Debt Due May 26 -------------------------------------------------- The creditors of Water Bearer Holdings Ltd. are required to file their proofs of debt by May 26, 2014, to be included in the company's dividend distribution. The company commenced liquidation proceedings on April 25, 2014. The company's liquidator is: CDL Company Ltd. P.O. Box 31106 Grand Cayman KY1-1205 Cayman Islands =============== C O L O M B I A =============== PACIFIC RUBIALES: S&P Affirms 'BB+' CCR; Outlook Stable ------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'BB+' corporate credit and issue-level ratings on Pacific Rubiales Energy Corp. (PRE). The outlook remains stable. The rating affirmations follow our regular annual review. The 'BB+' rating on PRE is derived from S&P's anchor of 'bb+', based on its "fair" business risk and "intermediate" financial risk profile assessments for the company, and no rating impact derived from the rating modifiers. The company's "fair" business risk profile is primarily based on its concentration in Colombia, as it generates 100% of its EBITDA in the country; smaller scale compared with its investment-grade peers; and 50% of its revenue coming from the Rubiales and Piriri blocks, whose concessions expire in 2016. However, as a result of the Petrominerales acquisition, PRE's reserves increased by 20% in 2013. Therefore, its dependence on the two fields decreased to 11% of total proved reserves as of December 2013 from 19% in 2012. S&P believes that the combined production from the new heavy-oil fields, CPE-6 and Rio Ariari, and its active exploration program will help the company to replace its production from the Rubiales field in the next two to three years. =================================== D O M I N I C A N R E P U B L I C =================================== BANCO BHD: IFC to Help Bank Develop Innovative Products ------------------------------------------------------- IFC, a member of the World Bank Group, will help Banco BHD develop new products to improve access to banking services for Dominican micro-entrepreneurs, who are crucial to the Dominican Republic's economy but lack the financial services needed to increase productivity and grow their businesses. MSMEs in the Dominican Republic have limited access to credit. Domestic credit to the private sector is only 24 percent of GDP, compared to 45 percent in Latin America. Only 17 percent of the country's workforce, including the informal sector, has access to banking services. IFC will help Banco BHD develop a market study to identify key gaps in the market and target clients who can benefit from financial services. The project will design a series of products based on this study to expand its reach to the unbanked population. "In the context of this partnership with IFC, Banco BHD work to design new products and services for micro and small enterprises," said Steven Puig, Executive Vice President and General Manager of Banco BHD. "We hope to provide these clients with the tools and products necessary to overcome the barriers of financial exclusion and to support them in growing their business ventures and improve their families' quality of life." Since its first investment with Banco BHD in 2003, IFC has provided financing of over US$60 million. In 2008, IFC became an equity shareholder in the bank's parent company Centro Financiero BHD. IFC has also provided advisory services to support BHD's sustainable energy financing and housing finance. "Financial inclusion plays a vital role in economic development. IFC has made it a priority as part of its commitment to reducing poverty and improving peoples' lives," said Ary Naim, IFC Country Head for the Dominican Republic. "Through this project with our partner BHD, IFC will continue fostering competition and innovation in the financial sector in the Dominican Republic." Since the Dominican Republic became a member of IFC in 1961, IFC has invested US$971.5 million in the country's private sector, including US$293 million in mobilization. IFC also implements advisory programs to improve the business climate, build skills of local entrepreneurs, and promote access to finance and markets for small businesses. IFC's accesses to finance programs in the Dominican Republic have been valued at US$1 million over the last four years. About IFC IFC --http://www.ifc.org/-- a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. Working with private enterprises in more than 100 countries, we use our capital, expertise, and influence to help eliminate extreme poverty and promote shared prosperity. About Banco BHD Banco BHD is a private bank in the Dominican Republic with total assets of US$3.1 billion, as of September 2013, a market share of 16 percent. Banco BHD was established in 1972 and currently has 88 branches across the country. * * * As reported in the Troubled Company Reporter-Latin America on Dec. 23, 2013, Fitch Ratings has affirmed Banco BHD's Viability Rating at 'b' and its Issuer Default Rating (IDR) at 'B' with a Stable Outlook, following the announcement of an agreement to merge with Banco Multiple Leon SA (BML). Fitch has also placed BML's IDRs, support and national ratings on Positive Watch. A complete list of rating actions follows at the end of this press release. XSTRATA PLC: Official's Statement Buoys Mine Plan ------------------------------------------------- Dominican Today reports that the assertion by the Minister of Energy and Mines that high altitude agriculture and firewood and charcoal trafficking, the use of pesticides and other chemicals in farms, and the extraction of construction aggregates from rivers threaten Dominican Republic's environment more than mining could boost several mining projects, especially Xstrata Nickel Falcondo's at Loma Miranda. Pelegrin Castillo also called for a defined government policy on mining and to encourage multi-sector consultations to achieve consensus, according to Dominican Today. Nonetheless when reporters asked about the viability of mining at Loma Miranda, Mr. Castillo declined comment. The report notes that the official met with members of the Chamber of Deputies commissions on Maritime Affairs and Energy, on his agency's plans to develop energy and mines and reforms to comply with international requirements. Mr. Castillo, the report discloses, said his department needs the support of Congress and the political leadership to achieve its goals. Mr. Castillo stressed, however, that mining must comply with the Constitutional provision on exploiting the natural resources under criteria of a sustainable environment, the report relates. As reported in the Troubled Company Reporter-Latin America on Jan. 22, 2014, Dominican Today said that Chief Executive Officer of Xstrata PLC's Falcondo reiterated that the company's presence in the country depends on a long term mining, with cheap electricity available, to produce and compete in world markets. David Soares said they pin their hopes of extracting nickel at the controversial site of Loma Miranda, between La Vega and Bonao (central), for which they expect to get the mining permit, according to Dominican Today. But environmental and civil society groups could keep them from carrying out the project, after the Chamber of Deputies agreed with the protesters and passed a bill which declares Loma Miranda a protected area, arguing that much of the Cibao region's (north) water depends on it, the report related. Xstrata PLC is the operator of Falconbridge Dominicana, C. por A. ("Falcondo") with an 85.26% ownership. Falcondo is a ferronickel surface mining operation located in the Dominican Republic with operations dating since 1971. Headquartered in Zug, Switzerland, Xstrata PLC is a major producer of coal, copper, nickel, primary vanadium and zinc and the largest producer of ferrochrome. * DOMINICAN REPUBLIC: Majority Thinks Economy on Right Path ----------------------------------------------------------- Dominican Today reports that for 58% of Dominicans the economy is on the right path, whereas 41 percent consider it going in the wrong direction, according to poll by Penn, Shoen & Berland disclosed. Pollster Bernardo Vega, who provided the figures on Despertador, Channel 9, said their survey conducted 12 months ago found the same figures: 41% of those surveyed said the economy was headed in the wrong direction, compared with 58% who felt otherwise, but with a narrower margin of error, according to Dominican Today. "The people are more optimist now than 12 months ago," the report quoted Mr. Vega, who represents Penn, Shoen & Berland, as saying. Mr. Vega, the report notes, said crime leads citizens' concerns with 37%, but didn't provide further details. =========== M E X I C O =========== GRUPO SENDA: Fitch Affirms 'B' IDR; Outlook Stable -------------------------------------------------- Fitch Ratings has affirmed Grupo Senda Autotransporte, S.A. de C.V.'s (Grupo Senda) local and foreign currency Issuer Default Ratings (IDRs) at 'B'. The Rating Outlook is Stable. The ratings reflect Fitch's view that the company's recent refinancing improves the company's debt structure by reducing financial costs and foreign currency exposure to USD-denominated debt; in addition its amortizing nature creates more benign conditions for the company to implement its deleveraging strategy. In Fitch's opinion, this new debt structure will likely allow the company to improve its cash flow generating ability in the medium term and in turn strengthen its credit metrics and credit quality. The ratings also incorporate that the challenging environment in which Grupo Senda has operated for the past 18 months, together with the application of a 16% value added tax (VAT) to passenger ticket prices effective as of Jan. 1, 2014, will pressure free cash flow (FCF) generation in 2014, and possibly in 2015. Grupo Senda's 'B' ratings reflect the company's leading market position in the highly competitive and fragmented intercity bus passenger transportation sector in Mexico, current high leverage, limited FCF generation, and weak liquidity, which will lead the company to partially rely upon banks for refinancing activities during the next few years. The ratings also incorporate industry- related risks such as seasonal fluctuations in passengers, cyclicality risk affecting the personnel segment, and volatile fuel costs. Positively, the company benefits from the importance of bus transportation within Mexico, which results from income constraints that limit the ability of many people to use more expensive alternative means of transportation, such as automobiles or airlines. Key Rating Drivers Improved Debt Structure A significant reduction in financing costs, the amortizing nature of the new loan and the elimination of exchange rate exposure to USD-denominated debt, all bode well for the company's deleveraging strategy. In Fitch's view, Grupo Senda's pervious debt structure made deleveraging heavily dependent on faster revenue and EBITDA expansion and burdened the company's available cash flow for debt repayment. However, the application of a 16% VAT to passenger ticket prices effective as of Jan. 1, 2014, coupled with still high fuel inflation in Mexico projected for 2014, will likely continue to pressure Grupo Senda's results in 2014. The company is implementing different initiatives to counteract the negative effect that the application of the VAT has on its operating results. If these were to materialize as planned, EBITDA could strengthen in 2014 above Fitch's base case scenario. Fitch notes that working capital related to the VAT is expected to improve, as the company will be able to compensate for VAT included in ticket sales with VAT paid to suppliers of goods and services. High Leverage Grupo Senda's gross leverage, measured by total debt/EBITDA ratio, deteriorated during the LTM ended March 31, 2014. The company reported gross leverage of 3.7x as of March 31, 2014, which represents an increase from 3.0x and 3.4x during the prior comparable periods of 2013 and 2012. The ratings factor in the expectation that the company will maintain stable total debt levels in 2014 and that these levels will begin to decline as scheduled amortizations begin in the first quarter of 2015. In Fitch's view, deleveraging coupled with liquidity and a manageable short-term maturity profile would improve Grupo Senda's credit quality and likely result in a rating upgrade. As of March 31, 2014, the company reported net debt/EBITDA of 3.6x and total debt of MXN3,507 million. Low Liquidity Remains a Rating Constraint: Grupo Senda's cash position remains low and the company continues to remain dependent on banks and on its short-term notes program to refinance short-term debt obligations. The company maintains good relationships with banks and access to short-term commercial paper. This is evidenced by the company's major refinancing of its senior secured notes via a syndicated bank loan. On April 23, 2014, the company rolled-over MXN110 million under its local note short-term program. As of March 31, 2014, the company's cash position was MXN81 million. Limited FCF Generation: The company's FCF generation remains low relative to its upcoming debt obligations. During the LTM ended March 31, 2014, Grupo Senda's FCF was negative MXN277 million primarily driven by MXN563 million in capex investments the company made in the fourth quarter of 2013. These expenditures were mainly allocated to the purchase of 80 passenger units, 126 personnel transportation units, and to remodeling of terminals. In 2014, FCF could be neutral to moderately positive depending on discretionary capex and the company's ability to implement its cost reduction, revenue generation and efficiency increasing initiatives. Fitch estimates cash flow from operations (CFFO) after interest paid and before capex to be in the range of MXN400 million-MXN450 million in the mid-term, but recognizes that it could strengthen above MXN500 million under a more benign fuel price environment and after the full absorption of VAT. Furthermore, lower leverage resulting from debt amortizations even if net debt repayment is lower than scheduled under the syndicated loan would result in higher cash flow generation and improve the company's credit quality. Improvement in the company's FCF generation would support positive rating actions. RATINGS SENSITIVITIES Fitch would view as positive to credit quality some combination of the following factors: improvement in FCF generation, a medium- term expectation of net leverage at or below 2.5x while maintaining adequate liquidity, and a manageable debt maturity profile. A negative rating action could be triggered by a deterioration of the company's credit metrics due to sizeable negative FCF or higher total debt levels. Expectations by Fitch of total debt to EBITDA being consistently at or beyond 4.5x would likely result in a downgrade. Increasing competition followed by the return to discounted-price practices, as a key component of the company's business strategy to gain market share, would also likely result in negative rating actions. *********** 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. 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, and Peter A. Chapman, Editors. Copyright 2014. 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 * * *