/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/141218.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, December 18, 2014, Vol. 15, No. 250 Headlines A N T I G U A & B A R B U D A STANFORD INT'L: Former Workers Could be Paid Within Six Months A R G E N T I N A ARGENTINA: Bond-Sale Bust is Missed Chance as Maturities Loom B R A Z I L BANCO DO ESTADO: Fitch Affirms 'BB+' IDR; Outlook Positive BRAZIL: October Economic Activity Below All Analyst Forecasts CYRELA BRAZIL: Fitch Affirms 'BB' IDR; Outlook Stable CSN: New Venture No Impact on Moody's Ba1 Rating GLOBOAVES SAO PAULO: Fitch Lowers IDR to 'B-'; Outlook Stable PETROLEO BRASILEIRO: To Cut Exploration Spending in Cash Crunch C A Y M A N I S L A N D S ALL SEASONS: Shareholder Receives Wind-Up Report CS BOND: Shareholders' Final Meeting Set for Dec. 19 CS EQUITY: Shareholders' Final Meeting Set for Dec. 19 CS MONEY: Shareholders' Final Meeting Set for Dec. 19 ERNB LTD: Shareholders Receive Wind-Up Report GLYNN EMERGING: Shareholders Receive Wind-Up Report HIGHLAND INVESTMENT: Shareholder Receives Wind-Up Report KAYDEE LTD: Shareholder Receives Wind-Up Report KSP CAPITAL: Members Receive Wind-Up Report LAZARD DIVERSIFIED: Shareholders Receive Wind-Up Report LIMMAT SELECT: Shareholders Receive Wind-Up Report NEW VENTURE: Members Receive Wind-Up Report RAWA HOLDINGS: Shareholders Receive Wind-Up Report THIRD IRIS: Shareholders Receive Wind-Up Report WING HANG: Shareholder Receives Wind-Up Report C H I L E CHILE: Will Improve Early Education With US$75 Million IDB Loan P A R A G U A Y PARAGUAY: Growth Projected Around 4 Percent Next Year, IMF Says P E R U PERU: Plans to Limit Bets Against Sol in Derivatives Market P U E R T O R I C O LIBERTY CABLEVISION: Moody's Affirms B3 Corporate Family Rating UNIV. OF PUERTO RICO: S&P Puts 'BB' Rev. Bond Rating on Watch Neg. - - - - - =============================== A N T I G U A & B A R B U D A =============================== STANFORD INT'L: Former Workers Could be Paid Within Six Months -------------------------------------------------------------- Tameika Malone at the Daily Observer reports that a six-month timeline has been given to former employees of Stanford Development Company (SDC) as the period within which they could start to receive monies owed to them. "Our sale agents believe that we will have that money in three to six months," one of the liquidators for SDC, Marcus Wide, said in an interview with Daily Observer. However, the Grant Thornton partner admitted that there could be further delays, the report notes. "It is not always possible to close sales. It took us almost nine months to close Yida because there are formalities and requirements from government. It could be that we have sales agreed (to) that we can't close for a period of time, but we are optimistic it can be done in three to six months," the report quoted Mr. Wide as saying. The liquidator said most of the properties already have prospective buyers, but the sales have to be finalized, according to Daily Observer. The report relays that Mr. Wide added that funds had to be borrowed to maintain the assets in order to ensure they will attract buyers, and that those monies must first be repaid before the former employees get their outstanding payments. Former Stanford workers, who were employed by Sun Printing and Publishing, Antigua Athletic Club and Sticky Wicket Restaurant picketed the offices of Grant Thornton last week to demand answers on when the money owed to them since the 2009 collapse of the Stanford empire will be forthcoming, the report notes. They complained that properties owned by the disgraced financier are being sold and nothing is forthcoming to them, the report discloses. However, Mr. Wide said the US$60 million received from the sale of Guiana Island to Yida International went to the Stanford International Bank, the report adds. About Stanford International Bank Domiciled in Antigua, Stanford International Bank Limited -- http://www.stanfordinternationalbank.com/-- is a member of Stanford Private Wealth Management, a global financial services network with US$51 billion in deposits and assets under management or advisement. Stanford Private Wealth Management serves more than 70,000 clients in 140 countries. On Feb. 16, 2009, the United States District Court for the Northern District of Texas, Dallas Division, signed an order appointing Ralph Janvey as receiver for all the assets and records of Stanford International Bank, Ltd., Stanford Group Company, Stanford Capital Management, LLC, Robert Allen Stanford, James M. Davis and Laura Pendergest-Holt and of all entities they own or control. The February 16 order, as amended March 12, 2009, directs the Receiver to, among other things, take control and possession of and to operate the Receivership Estate, and to perform all acts necessary to conserve, hold, manage and preserve the value of the Receivership Estate. The U.S. Securities and Exchange Commission, on Feb. 17, charged before the U.S. District Court in Dallas, Texas, Mr. Stanford and three of his companies for orchestrating a fraudulent, multi- billion dollar investment scheme centering on an US$8 billion Certificate of Deposit program. A criminal case was pursued against him in June before the U.S. District Court in Houston, Texas. Mr. Stanford pleaded not guilty to 21 charges of multi-billion dollar fraud, money- laundering and obstruction of justice. Assistant Attorney General Lanny Breuer, as cited by Agence France-Presse News, said in a 57-page indictment that Mr. Stanford could face up to 250 years in prison if convicted on all charges. Mr. Stanford surrendered to U.S. authorities after a warrant was issued for his arrest on the criminal charges. ================= A R G E N T I N A ================= ARGENTINA: Bond-Sale Bust is Missed Chance as Maturities Loom ------------------------------------------------------------- Camila Russo at Bloomberg News reports that Argentina missed a chance to boost foreign reserves and push back much of the US$12 billion in debt coming due next year as investors balked at the terms for the country's first bond sale since defaulting in July. The government issued just US$286 million of the US$3 billion in 10-year notes that it offered last week for 96.2 cents on the dollar, above the 94.4 cents they fetch in the secondary market. Offers to swap US$6.3 billion of securities due next year for ones that mature in 2024 lured investors holding less than 10 percent of the debt outstanding, according to Bloomberg News. Both the swap and the sale involved notes governed by local law, exempt from a U.S. court ruling that prevents the country from paying overseas debt, Bloomberg News notes. Bloomberg News relates that Argentina's debt obligations next year total about 40 percent of its foreign reserves, and the country remains locked out of international credit markets because of a decade-long dispute with holders of bonds it defaulted on in 2001. Siobhan Morden, the head of Latin America strategy at Jefferies LLC, said the nation should have offered better prices in the debt deal to trim next year's payments and raise much-needed cash, Bloomberg News discloses. "They lost an opportunity for cashflow savings, offering no motivation to participate," Mr. Morden said in an e-mailed response to questions after the sale Dec. 12, Bloomberg News relates. "Why not do it right? They'll probably resort to intra- government financing as they still need cashflow relief when debt service nearly doubles next year," Bloomberg News quoted Mr. Mordern as saying. Argentina swapped US$377 million of local-law notes, known as Boden 15s, for local dollar-denominated bonds due 2024, Bloomberg News notes. It bought back US$185 million of the securities due next year at 97 cents on the dollar, below the 97.1 cents they were trading at. The new bonds it sold were priced to yield about 9.5 percent, Bloomberg News relays. Ability to Pay Economy Minister Axel Kicillof said Dec. 12 in Buenos Aires that the fact Argentina was able to sell any debt at all in the midst of what he called a "catastrophic" international context means the issuance was a success, Bloomberg News says. More than US$1.2 trillion was erased from equities worldwide last week as the drop in crude oil below US$58 a barrel raised concern over the strength of the global economy, Bloomberg News discloses. In an interview in Radio Nacional, Minister Kicillof rejected that the terms were poorly designed and said, "the country isn't crawling through the desert looking for the last dollar," Bloomberg News says. The economy minister also said investors didn't swap or cash in their 2015 bonds because they're confident in Argentina's capacity to pay, Bloomberg News discloses. The government didn't hire an international bank to advise on the transaction, Bloomberg News adds. Lack of Interest Argentina's benchmark international debt due in 2033 fell 0.46 cent to 85.92 cents on the dollar as of 9:55 a.m. in New York on Dec. 15. The local-law bonds due in 2024 sank 0.79 cent to a one- month low of 93.62 cents on the dollar. Investors who wanted to buy large amounts of the 2024 notes and couldn't find liquidity in the secondary market were the likely purchasers last week, according to Alejo Costa, a strategist at Puente Hnos Sociedad de Bolsa SA in Buenos Aires, Bloomberg News discloses. Bloomberg News notes that Argentina could still get additional financing from international investors if it issues local-law bonds at more attractive prices, according to Eduardo Levy-Yeyati, the director of Buenos Aires-based consultancy firm Elypsis. "Their offer was below market so the lack of interest was rather predictable," Levy-Yeyati, who also works as a consultant for the World Bank, said in an e-mailed response to Bloomberg News' questions. "This doesn't say much about Argentina's access. It is still there, for limited amounts, at the market price," Mr. Levy- Yeyati said, Bloomberg News says. For Joshua Rosner, a bank analyst at Graham Fisher & Co., the results of the transactions show Argentina needs to settle the dispute with creditors that prevents it from accessing capital markets overseas, Bloomberg News discloses. After losing a lawsuit, the country is blocked from servicing international debt until it pays some holders of bonds it defaulted on in 2001 in full, Bloomberg News relays. "As long as the country avoids settlement with the holdouts, it is incapable of raising money even as it offers 10 percent," Mr. Rosner wrote in an e-mail obtained by Bloomberg News. * * * The Troubled Company Reporter-Latin America, on Aug. 1, 2014, reported that Argentina defaulted on some of its debt late July 30 after expiration of a 30-day grace period on a US$539 million interest payment. Earlier that day, talks with a court- appointed mediator ended without resolving a standoff between the country and a group of hedge funds seeking full payment on bonds that the country had defaulted on in 2001. A U.S. judge had ruled that the interest payment couldn't be made unless the hedge funds led by Elliott Management Corp., got the US$1.5 billion they claimed. The country hasn't been able to access international credit markets since its US$95 billion default 13 years ago. As a result, reported the TCR-LA on Aug. 1, Standard & Poor's Ratings Services lowered its unsolicited long-and short-term foreign currency sovereign credit ratings on the Republic of Argentina to selective default ('SD') from 'CCC-/C'. The TCR-LA, on Aug. 4, 2014, also reported that Fitch Ratings downgraded Argentina's Foreign Currency Issuer Default Rating (IDR) to 'RD' from 'CC', and its Short-Term Foreign Currency Issuer Default Rating to 'RD' from 'C'. Meanwhile, Moody's Investors Service affirmed Argentina's Caa1 issuer rating, which also applies to domestic law bonds, confirmed the (P)Caa2 rating for its foreign law bonds, and affirmed the Ca rating on the original defaulted bonds. The long-term issuer rating was placed on negative outlook, reported the TCR-LA on Aug. 5, 2014. On Aug. 8, 2014, the TCR-LA reported that Moody's Latin America Agente de Calificacion de Riesgo affirmed the deposit, debt, issuer and corporate family ratings on Argentina's banks and financial institutions, both on the global and national scales. The outlook on these ratings has been changed to negative from stable. At the same time, the rating agency has affirmed the banks' Caa2 foreign-currency deposit ratings and Not- Prime short-term ratings. The banks' standalone E financial strength ratings corresponding to caa1 baseline credit assessments (BCA) have also been affirmed. The TCR-LA, On Aug. 6, 2014, also reported that DBRS Inc. has downgraded Argentina's long-term foreign currency issuer rating from CC to Selective Default (SD). The short-term foreign currency rating has been downgraded to Default (D), from R-5. The long-term and short-term local currency issuer ratings have been confirmed at B (low) and R-5, respectively. The trend on the long-term local currency rating is Negative, and the trend on the short-term local currency rating is Stable. On Nov. 3, 2014, the TCR-LA reported that Fitch Ratings downgraded Argentina's rating on Par Bonds issued under Foreign Law to 'D' from 'C' as Argentina has not been able to cure the missed coupon payments on its par bonds issued under foreign law after the expiration of the 30-day grace period on Oct. 30. According to Fitch's criteria, this constitutes an event of default and Fitch has downgraded the affected securities to 'D'. In addition, Fitch has affirmed: -- Foreign Currency Issuer Default Rating (IDR) at 'RD'; -- Local Currency IDR at 'CCC'; -- Short-term Foreign Currency IDR at 'RD'; -- Country Ceiling at 'CCC'. -- Performing Foreign Law Exchanged Securities (Global 17) at 'C'; -- Local Currency exchanged bonds under Argentine Law at 'CCC'; -- Foreign and Local Currency non-exchanged securities under Argentine Law at 'CCC'; -- Discount Bonds issued under Foreign Law at 'D'. =========== B R A Z I L =========== BANCO DO ESTADO: Fitch Affirms 'BB+' IDR; Outlook Positive ---------------------------------------------------------- Fitch Ratings has affirmed Banco do Estado do Rio Grande do Sul (Banrisul) Long- Term Issuer Default Rating (IDR) at 'BB+'. Fitch has also affirmed Banrisul's Viability Rating at 'bb+' and the National Long-Term rating at 'AA-(bra)'. The Outlooks for the ratings is Positive. KEY RATING DRIVERS The Positive Outlook reflects Fitch Ratings' expectation that Banco do Estado do Rio Grande do Sul's (Banrisul) performance will remain consistent with its peers in 2015, preserving both asset quality and profitability metrics, despite the more challenging economic conditions. Banrisul's ratings also embed the bank's regional importance, its stable retail funding base, adequate profitability and liquidity ratios. Fitch factors in the political influence in Banrisul's ratings. However, the agency does not consider Rio Grande do Sul's support on Banrisul. The Support Rating of '4' and Support Rating Floor 'B' reflect that a limited support from the federal government would be possible under a stress scenario given Banrisul's relative importance to the financial system since Banrisul ranks as the 12th largest bank in Brazil. However, there are no explicit guarantees of this support. Banrisul was able to post compatible performance metrics up to September 2014, as expressed by a net interest margin of 6.8%, despite suffering from some price pressure during 2014, especially in the secured loans segment (payroll deductible), coupled with an increase credit cost. Banrisul continues to benefit from increased fee-related revenues, but they do not cover the full amount of personnel expenditures, as it is for the other large private retail banks in Brazil. In light of the more challenging economic situation affecting companies in the state and its shift towards services, Banrisul has reviewed the credit expansion to 10%-14% for 2014, from the annual average growth of 18.9% posted in the last five years. Consumer credits should continue to expand relatively higher, boosted by the acquisition of payroll deductible loans from other banks. Reflecting the poor economic performance, Banrisul's loans past due for over 90 days reached 3.5% of the portfolio in September 2014, slightly worse than the national financial system figures for the period (3.0%) and when compared with 2013 (3.2%). In light of the macroeconomic challenges, Fitch expects some deterioration in the bank's corporate portfolio for 2015, partially mitigated by the fact that its credit operations are not concentrated. Banrisul Debt Letras Financeiras: Banrisul's senior unsecured domestic issuances rank equal with its other senior unsecured debt, and its ratings are aligned to the bank long-term national ratings. USD Tier 2 Subordinated Notes: Banrisul's 'BB-' rated subordinated notes due January 2022 are rated two notches below the VR 'bb+' of the bank. Fitch discounts one notch for loss severity characteristics and subordinated status and one notch for its moderate risk of failure in performance. These notes rank pari passu to the bank's subordinated debt and have a cumulative coupon deferral mechanism that can be exercised if the minimum regulatory capital is breached. These notes are losing equity credit as they do not qualify for equity credit under Basel 3 requirements. RATING SENSITIVITIES Banrisul's VR and IDR Positive Factors: Banrisul's ability to generate adequate profitability in times of economic distress as measured by an Operating Profit/ Average Total Assets of around 2% along with its good asset quality ratios, expressed by its nonperforming loans above 90 days around 3% and more than 150% loan loss reserve coverage, could result in an upgrade in its Viability Rating and consequently in its IDRs. Negative Factors: Deterioration in Banrisul's asset quality and/or its profitability could result in an Outlook of Stable. It also could be downgraded if its asset quality ratios deteriorate, as expressed by 90 days past due loan ratio above 5% and weaker loan loss coverage and/or if its Fitch core capital is below 12%. Any change of Banrisul's ratings may lead to a review of ratings assigned to its issuances. Fitch affirms these ratings: Banco do Estado do Rio Grande do Sul -- Long-term Foreign and Local currency IDRs at 'BB+'; Positive Outlook; -- Short-term Local and Foreign Currency IDR at 'B'; -- Viability Rating at 'bb+'; -- Support rating at '4'; -- Support Rating Floor at 'B'; -- National Long Term rating at 'AA-(bra)'; Positive Outlook; -- National Short-Term rating at 'F1+(bra)'; -- First Issuance of Senior Unsecured Letras Financeiras at 'AA-(bra)'; -- Tier II Subordinated notes due Feb 2022 at 'BB-'. BRAZIL: October Economic Activity Below All Analyst Forecasts ------------------------------------------------------------- Mario Sergio Lima at Bloomberg News reports that Brazil's economic activity in October unexpectedly declined, as the central bank continues to raise rates in the biggest emerging market after China. The seasonally adjusted economic index, a proxy for gross domestic product, fell 0.26 percent in October from the prior month after growing a revised 0.26 percent in September, the central bank said in a report posted on its website, according to Bloomberg News. That was below every estimate from 27 economists surveyed by Bloomberg, whose median forecast was for a 0.25 percent expansion. Bloomberg News notes that Brazil's edged out of recession in the third quarter, as the country is expected by economists to grow at the slowest pace in five years. Waning confidence increases the challenges for appointed Finance Minister Joaquim Levy, who vowed to impose more rigorous fiscal discipline to narrow the widest budget deficit in a decade, Bloomberg News relates. The non-seasonally adjusted economic activity index fell 1.18 percent from a year ago, compared with a median estimate of a 0.30 percent drop, the central bank report said, Bloomberg News discloses. "This suggests that the fourth quarter started out on the wrong foot," Bloomberg News quoted Andre Perfeito, chief economist at Gradual Investimento, as saying. "It was a big disappointment, and with marginally better numbers in retail sales and weak industrial output, exports probably brought the number down," Mr. Perfeito added. Economists surveyed by the central bank cut this year's gross domestic product estimate to 0.16 from 0.18 last week, the bank said on its website, Bloomberg News notes. That would be the worst result since 2009. For 2015, they see expansion of 0.69 percent, down from 0.73 percent the previous week, Bloomberg News relays. Largest Economy Brazil's economy expanded 0.1 percent in the third quarter after recording a recession in the first six months of the year, Bloomberg News notes. Weak growth and deteriorating fiscal results led Standard & Poor's in March to cut the country's sovereign debt rating to one level above junk. In September, Moody's Investors Services followed by cutting Brazil's outlook to negative. Inflation accelerated to 0.51 percent in November from 0.42 percent in the previous month, Bloomberg News discloses. Annual consumer prices ended November at 6.56 percent, above the ceiling of the government-set target of 4.5 percent plus or minus two percentage points, Bloomberg News relays. Analysts surveyed by the central bank expect inflation to end 2014 at 6.38 percent and to finish 2015 at 6.50 percent, Bloomberg News notes. Price increases have contributed to falling consumer confidence, which in November reached its lowest level in more than five years, according to the Getulio Vargas Foundation, a Brazilian research group and business school, Bloomberg News says. Bloomberg News discloses that with inflation above target, the central bank on Dec. 3 boosted the benchmark interest rate by half a point to 11.75 percent. The bank said in the minutes from the meeting that fiscal policy will become tighter and additional rate adjustments to contain above-target inflation will probably be carried out with parsimony, Bloomberg News notes. "I think we could see this number as an indication that the central bank's rate increases are starting to have an impact on activity," Mr. Perfeito told Bloomberg News in a telephone interview from Sao Paulo. Brazil's real has weakened 11.9 percent against the dollar in the past three months, the second-worst among major currencies tracked by Bloomberg. CYRELA BRAZIL: Fitch Affirms 'BB' IDR; Outlook Stable ----------------------------------------------------- Fitch Ratings has affirmed Cyrela Brazil Realty S.A. Empreendimentos e Participacoes' (Cyrela) foreign- and local- currency Issuer Default Ratings (IDR) at 'BB' and long-term national scale at 'AA-(bra)'. The Rating Outlook for Cyrela's corporate ratings is Stable. Cyrela's ratings remain supported by the company's conservative financial strategy sustained by low leverage, strong liquidity and well-distributed corporate debt maturity profile. The ratings are also supported by Cyrela's historical satisfactory operational performance, resulting from the company's ability to operate with adequate operating margins and positive operational cash flow generation, on a recurring basis, despite the more challenging environment observed for the industry in the last couple of years. Cyrela's credit profile is also benefits from the company's position as one of the largest developers in Brazil's real estate industry, the strength of its franchise and its solid and diversified landbank. The ratings remain constrained by the expectation that inventory of finished units should remain high and by the exposure of its business to the cyclicality of the homebuilding industry, which is highly correlated with the local economy and vulnerable to an economic slowdown, higher unemployment rate and restrictions in lines of credit. Fitch has a cautious outlook for the homebuilding sector in 2015. The sector risk is considered above average, due to the long construction cycle and direct exposure to macroeconomic conditions. The deterioration of the Brazilian macroeconomic scenario has resulted in lower homebuyers' indebtedness capacity and higher interest rates, which could increase cancellation of sales contracts and generate limitations in reselling capacity. KEY RATING DRIVERS Conservative Financial Strategy The company's financial strategy is conservative and is designed to maintain a strong cash cushion, which has remained above BRL1.7 billion since 2011, and a lengthened corporate debt maturity profile. As of Sept. 30, 2014, cash and marketable securities was BRL1.8 billion and total debt was BRL4.2 billion, with BRL1.9 billion due at the end of 2015 and BRL1.1 billion in 2016. Out of debt maturities, BRL528 million and BRL402 million, respectively, are related to corporate debt. A significant part of Cyrela's cash position is restricted cash, to finance construction costs. Non-restricted cash at the holding level of BRL554 million covered corporate debt due up to the end of 2015 at 1.1x. The company also benefits from potential liquidity from approximately BRL1.2 billion of receivables from completed and sold units not linked to debt and about BRL3.2 billion of receivables that will mature in the next 24 months, net of costs to be incurred. Positive Cash Flow Generation Cyrela reported positive cash flow from operations (CFFO) during the last four years and free cash flow (FCF) should continue to benefit from high volume of project deliveries in the next couple of years. In the LTM ended September 2014, the company generated FFO of BRL1.1 billion, CFFO of BRL721 million and FCF of BRL471 million. These numbers compare with BRL888 million, BRL334 million and BRL51 million, respectively, reported in 2013. EBITDA was BRL1.3 billion (excluding financial expenses allocated to costs). Cyrela used part of its cash generation in a share buyback program that amounted BRL109 million in 2013 and BRL265 million in the nine months ended September 2014. Higher dividend distribution and/or a share repurchase program, however, could pressure the company's FCF. Net Leverage to Remain Low Cyrela's net leverage should remain at conservative levels. In the LTM ended September 2014, total debt/adjusted EBITDA was 3.3x and, on a net basis, was 1.9x. These ratios compare with an average of 3.6x and 2.2x between 2010 and 2013. Fitch expects net leverage around 2.0x in the next couple of years. When analyzed under potential cash flow generation, the ratio of total receivables on the balance sheet plus inventory of concluded units plus revenue to be booked over net debt plus acquisition of property for development plus cost to be incurred of units sold was 1.8x in September 2014, stable compared to December 2013. This coverage ratio is strong and well above the industry's average. Finished Inventory Not Expected to Reduce Cyrela was efficient in managing the turnaround operating strategy and reported adequate margins, despite diverse market conditions. In the LTM ended September 2014, EBITDA margin was 22.6%, compared with an average of 21.4% reported in the last three years. Despite the reduction in sales speed, it remained above the average for the sector. The average sales over supply ratio, net of cancellations, was 16.3% per quarter during the first nine months of 2014, compared to 20.8% per quarter in 2013 and 18.2% per quarter in 2012. The volume of cancellations of sales contracts remained manageable. However, Cyrela still has the challenge to reduce its high inventory of finished units. As of Sept. 30, 2014, total inventory had estimated market value of BRL5.4 billion and about 18% consisted of concluded units. Fitch does not expect a significant reduction of finished inventory in the short term, as 31% of total inventory of units under construction will be delivered up to the end of 2015 and part of the company's inventory is located in cities with oversupply. RATING SENSITIVITIES Cyrela's ratings could be upgraded if the company preserves current credit metrics for a longer period of time and in diverse market conditions, coupled with the reduction of inventory to more conservative levels. Cyrela's ratings could be negatively affected if company's cash- to-short-term corporate debt coverage reduces to below 1.0x; by an increase in net leverage to above 3.5x on a recurring basis; and if inventory of concluded units continue to increase, frustrating Fitch's expectation of cash flow generation capacity. A reduction of total receivables on the balance sheet plus inventory of concluded units plus revenue to be booked over net debt plus acquisition of property for development plus cost to be incurred of units sold ratio to levels below 1.7x could also negatively pressure the ratings. In addition, a scenario for a Negative Outlook or downgrade includes a more unstable macroeconomic environment, which could impact the homebuilding sector's fundamentals. CSN: New Venture No Impact on Moody's Ba1 Rating ------------------------------------------------ Moody's Investors Service comments that CSN's announced new joint- venture that will consolidate all mining assets under Congonhas Minerios S.A is credit positive, but has no impact on the company's Ba1 ratings. GLOBOAVES SAO PAULO: Fitch Lowers IDR to 'B-'; Outlook Stable ------------------------------------------------------------- Fitch Ratings has downgraded the long-term foreign- and local- currency Issuer Default Ratings (IDRs) of Globoaves Sao Paulo Agroavicola Ltda (Globoaves) to 'B-' from 'B', as well as the National Scale rating to 'BB+(bra)' from 'BBB(bra)'. The Rating Outlook is Stable. The downgrade follows the company' failure to place a USD200 million five-year bond in the second half of 2014, which has triggered a negative rating action as had been outlined by Fitch on June 15, 2014. This bond was crucial for improving the company's liquidity position and lengthening its debt structure. As of Sept. 30, 2014, Globoaves reported consolidated cash of BRL46 million, which covered 14% of its BRL329 million of short- term debt obligations. KEY RATING DRIVERS Volatile Industry The 'B-' rating also reflects Globoaves' operations in the volatile meat protein business, which results in significant fluctuation in its earnings and cash flow generation. Positively, Globoaves has a long operational track record and a relatively large market position in the niche segment of fertilized eggs and day-old-chicken production. The high margin of its genetics and breeding businesses, which represented 75% of total combined EBITDA in 2013, mitigates the volatility and small size of its protein segment. Globoaves' capital structure is moderately leveraged with its consolidated net adjusted debt/EBITDAR ratio at 2.0x during 2013. Low Liquidity Globoaves' financial flexibility is constrained by a high level of secured bank debt and weak liquidity position. This continues to impede the company's ability to refinance its debt. As of Sept. 30, 2014, Globoaves only had BRL46 million of cash, which compares unfavorably to BRL329 million of short-term debt. Most of the company's short-term debt is related to trade finance debt and has been rolled over as a result of the company's strong flow of exports. Well-Established Company in Volatile Industry Globoaves has operated for more than 35 years in the genetics and breeding stages of the poultry industry's supply chain. Combined, the genetics and breeding businesses account for 75% of the group's EBITDA. The balance of the company's EBITDA is generated by its subsidiary, Kaefer Agroindustrial, which produces pork and chicken. Globoaves' operating environment and cash flow are volatile. The prices of Globoaves' products are outside the company's control, as they depend upon demand for broilers, chicken and pork meat, while its costs are highly correlated with grain prices. Steady 2014 Performance Globoaves' combined businesses generated BRL253 million of EBITDA in 2013, which compares positively with BRL136 million in 2012. Similarly, the company's EBITDA margin expanded to 22% from 12% during this time period. Fitch expects that Globoaves will present a slightly lower EBITDAR generation and margins in 2014, due to the challenges the company faces to transfer the increasing costs to customers via prices. In September 2014, the combined businesses generated BRL245 million of EBITDA with a margin of 19.2%. Results during 2012 were hit hard by high grain prices. FCF to Remain Negative in Short Term Although Globoaves' EBITDA generation was high in 2013, its free cash flow (FCF) was negative BRL60 million due to large working capital needs for grain and high capex levels. The company plans to increase its protein production capacity by investing an additional BRL100 million in capex during 2014 through 2016. Fitch expects FCF to turn moderately positive by 2016. Moderate Leverage Leverage at Globoaves was only moderately high during 2013 due to the sharp upturn in EBITDA. For 2013, the company ended the year with a net adjusted debt/EBITDA ratio of 2.0x; this compares with 3x during 2012. Leverage remained quite unchanged during as of September 2014 LTM, at 2x. However, Fitch expects the company's leverage to be in the range of 2x to 2.3x during the next two years. RATING SENSITIVITIES A negative rating action may occur if the company's business position deteriorates or if it has debt-financed acquisitions that could lead to a net leverage ratio above 3x. Continued weak liquidity could also result in an additional negative rating action. A solid liquidity position and an improved debt maturity schedule, with a cash and marketable securities position covering about 1x the short-term debt, could lead to a positive rating action. PETROLEO BRASILEIRO: To Cut Exploration Spending in Cash Crunch --------------------------------------------------------------- Sabrina Valle and Leonardo Silva at Bloomberg News report that Petroleo Brasileiro SA is curbing refining and exploration spending in response to the collapse in prices and difficulties tapping debt markets during a corruption probe, said two people with direct knowledge of the matter. The state-run oil company known as Petrobras plans to freeze investments in the Premium I and Premium II refineries in northeastern Brazil and sell assets to protect its cash position, said one of the people, according to Bloomberg News. The exploration cuts will focus on projects that are behind schedule, they said, Bloomberg News relates. Both asked not to be named because the information isn't public. "This is totally beneficial for the company, as they can build cash," Henrique Kleine, an analyst at brokerage Magliano told Bloomberg News in a telephone interview. "The stock price is so low and that brings strong volatility," Bloomberg News quoted Mr. Kleine as saying. Petrobras, the most indebted publicly-traded oil company, is trading at the lowest since 2004 amid an expanding investigation into contractors who allegedly bribed company officials, Bloomberg News relates. The oil producer has delayed reporting its financial results while independent investigators conclude their reports in what has become Brazil's largest-ever money-laundering and corruption scandal, Bloomberg News discloses. Writedown Discord Petrobras has said it needs to release audited results to access foreign capital markets, Bloomberg News relays. The delay in reporting results came after the company's board couldn't agree on the size of writedowns stemming from graft-related costs, a person with direct knowledge of the issue, who asked not to be named because the information isn't public, said, Bloomberg News says. The company must report unaudited results by the end of January to avoid breaching covenants on some of its bonds that could result in accelerated payments, it said in a statement Dec. 12, Bloomberg News discloses. Petrobras also plans to review its fuel-price strategy and curb operating expenses to preserve cash, which stood at BRL62.5 billion (US$23 billion) at the end of September, it added, Bloomberg News notes. The price of crude oil plunged through US$60 a barrel for the first time in five years amid a supply glut, Bloomberg News relays. While Petrobras is looking to contain spending in Brazil, it's delaying a planned exit from Argentina's petrochemical business as the graft case in Brazil slows signing of new contracts, two people familiar with that process said, Bloomberg News notes. Petrobras received a joint offer for its 34 percent stake in Cia. Mega SA from partners YPF SA and Dow Chemical Co., said the people, who asked not to be named because the talks are private, Bloomberg News notes. Buenos Aires-based YPF SA owns 38 percent of Mega and Dow has 28 percent. Based in Rio de Janeiro, Brazil, Petroleo Brasileiro S.A. -- Petrobras (Brazilian Petroleum Corporation) -- explores for oil and gas and produces, refines, purchases, and transports oil and gas products. The Company has proved reserves of about 14.1 billion barrels of oil equivalent and operates 16 refineries, an extensive pipeline network, and more than 8,000 gas stations. As reported in the Troubled Company Reporter-Latin America on Dec. 11, 2014, Moody's Investors Service lowered Petrobras' Baseline Credit Assessment (BCA) to ba1 from baa3. The outlooks on all of the ratings remain negative for Petrobras, Brazil's national oil company. ========================== C A Y M A N I S L A N D S ========================== ALL SEASONS: Shareholder Receives Wind-Up Report ------------------------------------------------ The shareholder of All Seasons Absolute Return Fund Ltd received on Dec. 4, 2014, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidators are: Roger Priaulx Edel Andersen c/o Genesis Trust & Corporate Services Ltd. Midtown Plaza, 2nd Floor Elgin Avenue, George Town Grand Cayman KY1-1106 Cayman Islands Telephone: (345) 945 3466 Facsimile: (345) 945 3470 CS BOND: Shareholders' Final Meeting Set for Dec. 19 ---------------------------------------------------- The shareholders of CS Bond Strategy Ltd. will hold their final meeting on Dec. 19, 2014, at 10:30 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidators are: Stuart Brankin Desmond Campbell c/o Aston Corporate Managers, Ltd. P.O. Box 1981 Grand Cayman Cayman Islands Telephone: (345) 949 5586 CS EQUITY: Shareholders' Final Meeting Set for Dec. 19 ------------------------------------------------------ The shareholders of CS Equity Strategy Ltd. will hold their final meeting on Dec. 19, 2014, at 10:30 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidators are: Stuart Brankin Desmond Campbell c/o Aston Corporate Managers, Ltd. P.O. Box 1981 Grand Cayman Cayman Islands Telephone: (345) 949 5586 CS MONEY: Shareholders' Final Meeting Set for Dec. 19 ----------------------------------------------------- The shareholders of CS Money Market Strategy Ltd. will hold their final meeting on Dec. 19, 2014, at 11:00 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidators are: Stuart Brankin Desmond Campbell c/o Aston Corporate Managers, Ltd. P.O. Box 1981 Grand Cayman Cayman Islands Telephone: (345) 949 5586 ERNB LTD: Shareholders Receive Wind-Up Report --------------------------------------------- The shareholders of ERNB Ltd. received on Nov. 26, 2014, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Eleanor Fisher c/o Kevin Guirey Telephone: (345) 814 4038 P.O. Box 776 38 Market Street, Camana Bay Grand Cayman KY1-9006 Cayman Islands GLYNN EMERGING: Shareholders Receive Wind-Up Report --------------------------------------------------- The shareholders of Glynn Emerging Opportunity III Offshore Fund received on Dec. 18, 2014, 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 HIGHLAND INVESTMENT: Shareholder Receives Wind-Up Report -------------------------------------------------------- The shareholder of Highland Investment Fund received on Dec. 4, 2014, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Marcelo Bandeira De Mello c/o Jonathan Turnham Telephone: +1 (345) 949 9876 Facsimile: +1 (345) 949 9877 KAYDEE LTD: Shareholder Receives Wind-Up Report ----------------------------------------------- The shareholder of Kaydee Ltd received on Dec. 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 KSP CAPITAL: Members Receive Wind-Up Report ------------------------------------------- The members of KSP Capital Managers Limited received on Dec. 1, 2014, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidators are: Jason Hughes c/o Tulloch & Co 4 Hill Street, London W1J 5NE United Kingdom LAZARD DIVERSIFIED: Shareholders Receive Wind-Up Report ------------------------------------------------------- The shareholders of Lazard Diversified Strategies Fund Ltd. received on Nov. 26, 2014, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Lazard Alternatives, LLC c/o Barnaby Gowrie Telephone: +1 (345) 914 6365 LIMMAT SELECT: Shareholders Receive Wind-Up Report -------------------------------------------------- The shareholders of Limmat Select Plus Master Ltd. received on Dec. 1, 2014, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Alternative Investment Solutions Ltd. 10 Market Street, Suite 140 Camana Bay Grand Cayman KY1-9006 Cayman Islands NEW VENTURE: Members Receive Wind-Up Report ------------------------------------------- The members of New Venture TL Ltd received on Dec. 1, 2014, 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 RAWA HOLDINGS: Shareholders Receive Wind-Up Report -------------------------------------------------- The shareholders of Rawa Holdings Limited received on Nov. 25, 2014, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidators are: Lana Farrington Jennifer Rankin Eagle Holdings Limited 25 Main Street P.O. Box 487, George Town Grand Cayman, KY1-1106 Cayman Islands THIRD IRIS: Shareholders Receive Wind-Up Report ----------------------------------------------- The shareholders of Third Iris Corp received on Nov. 26, 2014, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Eleanor Fisher c/o Kevin Guirey Telephone: (345) 814 4038 P.O. Box 776 38 Market Street, Camana Bay Grand Cayman KY1-9006 Cayman Islands WING HANG: Shareholder Receives Wind-Up Report ---------------------------------------------- The shareholder of Wing Hang Bank (Cayman) Ltd received on Dec. 10, 2014, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidators are: Lee Tak Lim Wong Pou San 113 Avenida Conselheiro Ferreira De Almeida 27 andar, J27, Edif. Holland Garden Macau Wong Pou San 54 Rua.Fernao Mendes Pinto Edf. Pou Seng 8-and-F Macau c/o Lee Tak Lim Telephone: 853-8398-3225 ========= C H I L E ========= CHILE: Will Improve Early Education With US$75 Million IDB Loan --------------------------------------------------------------- The Inter-American Development Bank (IDB) has approved a loan of US$75 million to finance a program that will contribute to the improvement of conditions for the development of girls and boys up to four years old in Chile through the expansion of daycare and pre-school centers. The new slots will incorporate high standards in infrastructure, equipment and services provided. The objectives of the Program for the Expansion and Improvement of Early Education include reducing the gap in care by expanding coverage, especially for Chilean families with fewer socio- economic resources, and contributing to the implementation of a high-quality agenda through activities that improve the performance of teachers and the quality of education. "At the IDB we are pleased to support early education in Chile, where quality activities generate many positive impacts during the school and adult years and are a powerful mechanism for promoting equity and social justice," said Jes£s Duarte, project team leader at the IDB. The program will finance the construction and equipment of approximately 150 early education centers, with about 222 daycare centers and 195 pre-school centers. Construction of the new centers will meet the guidelines, norms and models established by the Ministry of Education and the National Kindergarten Board to facilitate comprehensive learning solutions, including a high degree of adaption of buildings to the biopsychosocial characteristics of the children, to their activities and to the deployment of teaching procedures that help children to achieve their maximum potential. The program also will support an effort to improve pre-school education, the establishment of a system of georeferencing the pre-school centers, the strengthening of teaching and administrative practices at the centers of the National Kindergarten Board, and the evaluation of the program. Among the results of these activities will be a proposal for a strategy to reduce the gap between the current centers and the establishments to be built with the new standards, which will guide the country's actions in this area in coming years. The program also will create new places for 4,500 children in daycare centers and 4,700 new places in early education centers, and will provide training to 8,000 teachers and technicians. The US$75 million IDB loan is payable in 15 years, with a four- year grace period, an interest rate based on LIBOR and US$75 million in local matching funds. =============== P A R A G U A Y =============== PARAGUAY: Growth Projected Around 4 Percent Next Year, IMF Says --------------------------------------------------------------- A staff team from the International Monetary Fund (IMF), led by Andre Meier, visited Asuncion during December 1-12 to hold discussions for the 2014 Article IV consultation. The team met with Central Bank of Paraguay (BCP) President Carlos Fernandez, Minister of Finance German Rojas, Minister of Labor, Employment, and Social Security Guillermo Sosa, Minister of Public Works and Communications Ramon Jim‚nez, and other senior officials, as well as representatives from Congress, the private sector, think tanks, and the donor community. At the conclusion of the visit, Mr. Meier issued the following statement: "Paraguay remains one of the most dynamic economies in Latin America, with growth projected around 4 percent both this year and next. Public debt is moderate, international reserves are ample, and inflation is expected to stay in line with the target. Notwithstanding these sound macroeconomic fundamentals, the outlook is subject to risks from lower agricultural commodity prices, economic weakness among trading partners, and weather- related shocks. In addition, Paraguay faces important structural challenges, including large infrastructure gaps, poor educational outcomes, and low public sector efficiency. "The authorities have started to tackle key structural challenges. Tax collection has improved significantly; preparations are underway to launch several large infrastructure projects; and the recently adopted 'freedom-of-information' law will foster government transparency. These efforts deserve full support and should be taken further to achieve lasting improvements in public services, institutional quality, and the rule of law. Such improvements, in turn, are critical to attract investment, boost productivity, and underpin medium-term growth and poverty reduction. "To consolidate macroeconomic stability, Paraguay has adopted new policy frameworks in recent years, notably an inflation targeting regime and the Fiscal Responsibility Law (FRL). These frameworks provide appropriate anchors for policy. It is thus unfortunate that the 2015 budget approved by the legislature envisages spending and a deficit above the limits mandated by the FRL, while perpetuating a pattern of unrealistically high revenue projections. Significant restraint in the execution of the budget will be required to limit the deficit to 1.5 percent of GDP and build the credibility of the FRL, as intended by the government. "More broadly, the planned expansion of public investment needs to be integrated into a prudent fiscal plan. To accommodate higher capital spending, it will be important to extend the fight against tax evasion, including in the customs administration, and ensure tight control over current spending. Civil service reform would assist this effort, by rationalizing public employment and raising efficiency. Over time, it may well become necessary to mobilize additional revenue, including by raising the tax contribution of the primary sector. A prudent medium-term plan will also leave some buffer relative to the FRL deficit ceiling so that fiscal policy does not need to be tightened during downturns. "Private sector participation in infrastructure investment is welcome but must be managed carefully to contain risks to the public finances. Particular caution is warranted with respect to deferred financing schemes that could create future government liabilities without the scrutiny of the regular budget process. "Fiscal risks could also arise from the missing oversight of Paraguay's pension funds and their significant actuarial imbalances. It is encouraging that the authorities plan to address these risks promptly, starting with the planned creation of the relevant superintendency. "Turning to monetary policy, the current level of interest rates is consistent with keeping inflation on target. To strengthen the transmission of monetary policy, it will be instrumental to further reduce excess overnight liquidity and develop a more active money market, while encouraging gradual de-dollarization. In addition, we welcome the central bank's intention to make its sales of government foreign-currency receipts more predictable, distinguishing them clearly from occasional discretionary intervention within the flexible exchange rate regime. "Credit growth has slowed from the peaks of recent years but remains strong, amid signs of rising indebtedness in the consumer segment. To contain the resulting risks, lenders should be required to observe prudent limits on households' debt servicing capacity. Other areas for stepped-up oversight include foreign- currency lending to borrowers that are not well hedged against exchange rate risk; and the proper recognition of credit risk in renewed, refinanced, and restructured loans. "In this context, the proposed revision of the central bank and banking laws is essential to put risk-based regulation and supervision on a robust legal basis. A related priority is to strengthen the governance and resources of the cooperatives regulator, along with the creation of a system-wide creditor database. "We are grateful to all our counterparts for their kind hospitality and the open and fruitful dialogue." ======= P E R U ======= PERU: Plans to Limit Bets Against Sol in Derivatives Market ----------------------------------------------------------- John Quigley at Bloomberg News reports that Peru plans limits on currency derivative trading to smooth out swings in the sol as policy makers seek to lower interest rates, central bank President Julio Velarde said. The limits will be announced within the next month and may help reduce volatility in the Peruvian currency in 2015, Mr. Velarde told reporters in Lima, according to Bloomberg News. Investors buying dollars in the derivatives market as they bet against the sol is the main reason for declines in the local currency, Mr. Velarde said, Bloomberg News relates. The currency is trading at its weakest level in more than five years as Peru's economy slows and the Federal Reserve moves toward raising interest rates, Bloomberg News discloses. "Excessive" volatility in the currency market last week prevented the central bank from cutting rates at its Dec. 11 meeting, Bloomberg News quoted Mr. Velarde as saying. "We're taking these measures specifically to give us more room in monetary policy," Mr. Velarde said, Bloomberg News relays. "The outlook for next year is for volatility. It's hard to know how much, but there's going to be volatility for sure," Mr. Velarde added. Bloomberg News notes that the monetary authority has sold US$4 billion in U.S. currency this year and introduced currency swaps to bolster the sol, which has fallen 5.5 percent against the greenback in 2014. Bloomberg News relays that Mr. Velarde said the bank is also studying measures to reduce bank lending in U.S. currency next year. The central bank seeks to avoid companies that have revenues in soles taking out loans in dollars, Bloomberg News says. The measures, which could be related to provisions or reserve requirements, will be announced at the end of this month, Mr. Velarde, Bloomberg News says. Outstanding loans in dollars rose 1.8 percent from a year earlier in October to US$29.4 billion, representing 39 percent of total credit, according to the central bank, Bloomberg News says. The bank is targeting a reduction in dollar-denominated credit of about 20 percent next year, Mr. Velarde said, Bloomberg News notes. Half of all company loans are in dollars, blunting the impact of rate cuts on the cost of borrowing, Mr. Velarde said, Bloomberg News relates. "That fine line between what happens in the currency market and what happens with interest rate" will continue to drive the bank's actions next year, Mr. Velarde added, notes the report. ====================== P U E R T O R I C O ====================== LIBERTY CABLEVISION: Moody's Affirms B3 Corporate Family Rating --------------------------------------------------------------- Moody's Investors Service affirmed the B3 Corporate Family Rating (CFR) and B3-PD Probability of Default Rating of Liberty Cablevision of Puerto Rico LLC (LCPR). The action follows the announced plan of LCPR's owners, Liberty Global plc (Liberty Global, Ba3 stable) and Searchlight Capital Partners, L.P. (Searchlight) to acquire Puerto Rico Cable Acquisition Company Inc. (Choice Cable, B2 negative) for $272.5 million and to combine the operations with LCPR. Moody's also affirmed the B2 ratings on LCPR's first lien credit facility and the Caa2 ratings on its second lien credit facility. LCPR expects to increase the first lien term loan by approximately $225 million and the second lien by approximately $32.5 million to help fund the acquisition. All rated Choice Cable debt would be repaid in conjunction with the acquisition. A summary of the actions follows. If the transaction occurs as proposed, Moody's expects to withdraw the B2 CFR and all other ratings for Choice Cable upon close, since all its existing rated debt would be repaid. Liberty Cablevision of Puerto Rico LLC Corporate Family Rating, Affirmed B3 Probability of Default Rating, Affirmed B3-PD Senior Secured 1st lien Term Loan, Affirmed B2, LGD3 Senior Secured 1st lien Revolving Credit Facility, Affirmed B2, LGD3 Senior Secured 2nd lien Term Loan, Affirmed Caa2, LGD6 Outlook, Remains Stable Ratings Rationale Moody's estimates the primarily debt funded transaction will increase LCPR's leverage to the mid 5 times debt-to-EBITDA range from the low 5 times. However, the combination would create an island wide operator, facilitating operating synergies and an improved ability to serve the commercial market. Also, Moody's believes the transaction could be free cash flow accretive, given Choice Cable's stronger free cash flow profile and that the incremental debt adds only approximately $13 million to annual interest expense. Notwithstanding some challenges in the integration of OneLink assets acquired in November 2012, Moody's believes Liberty Global's track record of acquisitions minimizes operational risk. These factors support the affirmation of the B3 CFR. Nevertheless, LCPR's weak capital structure provides minimal flexibility for managing the weak economic and demographic trends in Puerto Rico, which Moody's believes will constrain subscriber growth. LCPR reported subscriber growth over the past year despite these conditions, but Choice Cable's subscriber base is shrinking. Also, Moody's believes operating metrics such as revenue per homes passed and subscriber penetration will remain well below stateside US cable operating peers. Geographic concentration and lack of scale also constrain the rating, although the company benefits from the scale of its 60% owner Liberty Global, plc. Furthermore, the combination creates scale in the Puerto Rican market, enabling consistent, cost effective marketing across the region and programming cost synergies. The stable outlook assumes the combined entity will achieve modest organic EBITDA growth, generate positive free cash flow, and maintain adequate or better liquidity. Moody's would consider a positive rating action with expectations for sustained leverage around 5 times debt-to-EBITDA or better and sustained free cash flow-to-debt above 3%. An upgrade would also require expectations for adequate or better liquidity and a management commitment to maintaining the stronger credit profile, including the ability and willingness to offset negative economic and demographic trends in Puerto Rico which could depress growth prospects with debt reduction. An increase in leverage to the high 6 times range, whether due to debt financed acquisitions or dividends or fundamental operating weakness, or deterioration of the liquidity profile would likely warrant a negative rating action. Liberty Cablevision of Puerto Rico LLC (LCPR) provides video, high speed data, and telephone services to residential and commercial customers in Puerto Rico. The company is indirectly 60% owned by LGI Broadband Operations, Inc. an entity 100% owned by Liberty Global plc (Ba3 stable) and 40% owned by Searchlight Capital Partners L.P. Its annual revenue is approximately $300 million, and as of September 30 the company had approximately 217,900 video, 205,300 high speed data and 154,200 phone RGUs. Puerto Rico Cable Acquisition Company, Inc., operating under the brand name Choice Cable, provides video, high speed data, and voice services to approximately 113,900 residential and commercial customers in the southern and western regions of Puerto Rico. Its annual revenue is approximately $85 million, and the company is owned by Spectrum Equity and Patriot Media. Executives from Patriot Media, who run RCN Telecom Services LLC (B2 stable) and Grande Communications Networks LLC (B2 stable), manage Choice Cable. The principal methodology used in these ratings was Global Pay Television - Cable and Direct-to-Home Satellite Operators published in April 2013. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. UNIV. OF PUERTO RICO: S&P Puts 'BB' Rev. Bond Rating on Watch Neg. ------------------------------------------------------------------ Standard & Poor's Ratings Services placed its 'BB' long-term rating on the University of Puerto Rico's (UPR) existing university system revenue bonds on CreditWatch with negative implications. Some of these bonds were issued by the Puerto Rico Industrial, Tourist, Educational, Medical, & Environmental Control Facilities Finance Authority. "This CreditWatch action follows our repeated attempts to obtain timely information of satisfactory quality to maintain our rating on the bonds in accordance with our applicable criteria and policies," said Standard & Poor's credit analyst Bianca Gaytan- Burrell. If UPR officials fail to provide us with the requested information by Dec. 30, 2014, S&P will likely suspend the affected rating, preceded by, in accordance with its policies, any change to the rating we consider appropriate given the available information. *********** 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 202-362-8552. * * * End of Transmission * * *