/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/160113.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 Wednesday, January 13, 2016, Vol. 17, No. 8 Headlines A R G E N T I N A FIDEICOMISO FINANCIERO PVCRED: Moody's Rates Class A Securities B1 B R A Z I L BRAZIL: Analysts Expect Economy to Contract Almost 3% in 2016 BRAZIL: Cans Carnival as Recession Bites EMPRESA DE ENERGIA: Moody's Rates BRL532MM Debentures Ba2/Aa3.br C A Y M A N I S L A N D S BLUEBAY ASSOCIATES: Shareholders Receive Wind-Up Report BLUEBAY EMERGING MARKET: Shareholders Receive Wind-Up Report BLUEBAY EMERGING MARKET FUND: Shareholders Receive Wind-Up Report BLUEBAY EMERGING FIXED: Shareholders Receive Wind-Up Report BLUEBAY EMERGING INCOME: Shareholders Receive Wind-Up Report BLUEBAY EMERGING OPPORTUNITY: Shareholders Receive Wind-Up Report BLUEBAY MACRO GENERAL: Shareholders Receive Wind-Up Report BLUEBAY MACRO FUND: Shareholders Receive Wind-Up Report BLUEBAY MACRO (MASTER): Shareholders Receive Wind-Up Report COMCEL TRUST: Fitch Affirms BB+ LT Currency Issuer Default Ratings FINANCE HOUSE: Shareholders Receive Wind-Up Report M SQUARE BRAZIL LONG: Member to Hear Wind-Up Report on Dec. 21 M SQUARE BRAZIL VALUE: Member to Hear Wind-Up Report on Dec. 21 ODEBRECHT OFFSHORE: Fitch Cuts Sr. Secured Notes Rating to 'CCC' PRENTICE LONG/SHORT: Members Receive Wind-Up Report WMG CONCENTRATED: Shareholders Receive Wind-Up Report YPF ECUADOR: Shareholder Receives Wind-Up Report C H I L E SOCIEDAD DE INVERSIONES: S&P Lowers CCR to 'B-'; Outlook Stable C O L O M B I A El QUIMBO: Hydro-Power Plant Back in Operation D O M I N I C A N R E P U B L I C DOMINICAN REP: Official Admits High Fuel Taxes, Offers Little Hope DOMINICAN REPUBLIC: Eyes Energy Pact Years in the Making E L S A L V A D O R REGAL FOREST: Fitch Affirms 'BB-' Long-term FC and LC IDR G U A T E M A L A BANCO AGROMERCANTIL: Fitch Hikes LT FC IDR to 'BB+' P U E R T O R I C O GOODMAN AND DOMINGUEZ: Files for Chapter 11 Bankruptcy Protection MANUEL MEDIAVILLA: Directed to File Amended Joint Plan - - - - - ================= A R G E N T I N A ================= FIDEICOMISO FINANCIERO PVCRED: Moody's Rates Class A Securities B1 ------------------------------------------------------------------ Moody's Latin America Agente de Calificacion de Riesgo has rated Fideicomiso Financiero Pvcred Serie XXV. This transaction will be issued by TMF Trust Company (Argentina) S.A. -- acting solely in its capacity as issuer and trustee. As of Jan. 11, the securities for this transaction have not yet been placed in the market. 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. -- ARS 87,325,000 in Class A Floating Rate Debt Securities (VRDA TV) of "Fideicomiso Financiero Pvcred Serie XXV", rated Aaa.ar (sf) (Argentine National Scale) and B1 (sf) (Global Scale, Local Currency) -- ARS 2,729,000 in Class B Floating Rate Debt Securities (VRDB TV) of "Fideicomiso Financiero Pvcred Serie XXV", rated B2.ar (sf) (Argentine National Scale) and Caa2 (sf) (Global Scale, Local Currency) -- ARS 46,391,000 in Certificates (CP) of "Fideicomiso Financiero Pvcred Serie XXV", rated Caa3.ar (sf) (Argentine National Scale) and Caa3 (sf) (Global Scale, Local Currency). RATINGS RATIONALE The rated securities are payable from the cashflow coming from the assets of the trust, which is an amortizing pool of approximately 7,976 eligible personal loans denominated in Argentine pesos, bearing fixed interest rate, originated by Pvcred, a financial company owned by Comafi's Group in Argentina. Only the installments due after April 30, 2016, will be assigned to the trust. The VRDA TV will bear a floating interest rate (BADLAR plus 400bps). The VRDA TV's interest rate will never be higher than 40% or lower than 22%. The VRDB will also bear a floating interest rate (BADLAR plus 500bps). The VRDB TV's interest rate will never be higher than 42% or lower than 24%. Overall credit enhancement is comprised of subordination, various reserve funds and excess spread. The transaction has initial subordination levels of 34.1% for the VRDA TV and 32.0% for the VRDB TV, calculated over the pool's principal balance as of April 30, 2016. The subordination levels will increase overtime due to the turbo sequential payment structure. The transaction will have a grace period for principal and interest payment until June 2016. The transaction also benefits from an estimated 41.0% annual excess spread, before considering losses, taxes or prepayments and calculated at the caps of 40% for the VRDA TV and 42% for the VRDB TV. 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. Although Moody's analyzed the historical performance data of previous transactions and similar receivables originated by Pvcred, the actual performance of the securitized pool may be affected, among others, by the economic activity, high inflation rates compared with nominal salaries increases and the unemployment rate in Argentina. 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 Pvcred portfolio. In addition, Moody's considered factors common to consumer loans securitizations such as delinquencies, prepayments and losses; as well as specific factors related to the Argentine market, such as the probability of an increase in losses if there are changes in the macroeconomic scenario in Argentina. These factors were incorporated in a cash flow model that takes into account all the relevant features of the transaction's assets and liabilities. Monte Carlo simulations were run, which determines the expected loss for the rated securities. Moody's analyzed the historical performance data of previous transactions and similar receivables originated by Pvcred, ranging from January 2012 to November 2015. Moody's has observed a weaker performance of loans in the unregulated segments compared to total portfolio of pvcred loans. As a result, and due to the uncertainty in the macroeconomic environment, Moody's has increased some of the default assumptions in the securitized pools. Moody's notes that there is significant uncertainty around key macroeconomic variables in Argentina, including inflation rates, salary increases compared to inflation, and economic activity, which have an impact on future performance of this transaction. In assigning the rating to this transaction, Moody's assumed a lognormal distribution of losses for each one of the different securitized subpools: for the PVCred loans, a mean of 22% and a coefficient of variation of 60% and for the "Refinanciados" loans, a mean of 41% and a coefficient of variation of 60%. Also, Moody's assumed a lognormal distribution for prepayments with a mean of 35% and a coefficient of variation of 70%. Servicer default was modeled by simulating the default of Banco Comafi as the servicer consistent with its current rating of Caa1/Baa1.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 3.6% expected loss for Class A Floating Rate Debt Securities, a 22.9% for the Class B Floating Rate Debt Securities and 41.9% for the Certificates. Moody's also evaluated the back-up servicing arrangements in the transaction. If Pvcred is removed as collection agent, Banco Comafi will be appointed as the back-up collection agent. Stress Scenarios: Moody's ran several stress scenarios, including increases in the default rate assumptions. If default rates were increased by 2% from the base case scenario, the ratings of the Class A Floating Rate Securities, the Class B Floating Rate Securities and of the Certificates would likely be downgraded to B2 (sf), Caa3 (sf) and Ca (sf) respectively. The principal methodology used in these ratings was "Moody's Approach to Rating Consumer Loan-Backed ABS" published in September 2015. =========== B R A Z I L =========== BRAZIL: Analysts Expect Economy to Contract Almost 3% in 2016 ------------------------------------------------------------- EFE News reports that analysts expect Brazil's economy to contract by 2.99 percent this year, with the outlook worsening slightly from last week's 2.95 percent estimate, the Central Bank said. The gross domestic product (GDP) figures come from the Boletin Focus, a weekly Central Bank survey of analysts from about 100 private financial institutions on the state of the national economy, according to EFE News. The government started using the survey in preparing its own forecasts last year, the report notes. Analysts estimate that Brazil's economy contracted by 3.71 percent in 2015, marking the biggest drop in economic output in 25 years, the report relays. The South American country's economy, according to analysts, will resume growing in 2017, when the GDP is projected to grow 0.86 percent, the report discloses. The projection in the previous survey called for 1 percent growth next year, the report notes. Analysts are also more pessimistic about the inflation rate for this year, with the estimate rising from 6.87 percent to 6.93 percent, the report says. The government expects inflation to end the year within its target range of 4.5 percent, with a 2 percent band that would put the top end rate at 6.5 percent, the report notes. Brazil had an inflation rate of 10.67 percent in 2015, the highest level in 13 years, the report relays. Brazil, in a technical recession with GDP contracting for three consecutive quarters, has had its sovereign debt lowered to junk status by Standard & Poor's and Fitch Ratings in recent months, EFE News says. The South American giant's economic growth has been hampered by spending cuts implemented by President Dilma Rousseff's administration to reduce the budget deficit and control inflation, the report adds. As reported in the Troubled Company Reporter-Latin America on Dec. 21, 2015, Fitch Ratings has downgraded Brazil's ratings: -- Long-term foreign and local currency Issuer Default Ratings (IDRs) to 'BB+' from 'BBB-', Outlook remains Negative; -- Senior unsecured foreign and local currency bonds to 'BB+' from 'BBB-'; -- Short-term foreign currency IDR to 'B' from 'F3'. BRAZIL: Cans Carnival as Recession Bites ---------------------------------------- Samantha Pearson at the Financial Times reports that towns and cities across Brazil are being forced to scrap the annual carnival parade as the country is braced for what is expected to be the worst recession since at least the 1930s. The traditional five-day celebration, set for early February this year, normally offers respite from Brazil's troubles -- even the 2008 global financial crisis failed to damp spirits and spending, according to Financial Times. But with the country stuck in a deep recession, unemployment and inflation rising, and President Dilma Rousseff's government mired in the biggest corruption scandal in the country's history, Brazilians are in no mood to party, the report notes. Campinas, home to 3 million people in Sao Paulo state, is among the cities that has been forced to rein in the festivities, including withdrawing public funding for its much-loved parade by local samba schools, the report discloses. Gabriel Rapassi, the city's director of culture, said the local government could not afford this year's carnival bill of BRL1.3 million ($322,000) due to a sharp drop in sales tax revenues from struggling local businesses, the report notes. "Non-essential services are the first to suffer," the report quoted Mr. Rapassi as saying. "2015 was already a very difficult year for us and now we are hearing that 2016 will be even worse," Mr. Rapassi added. The report notes that Carnival has also been cancelled in Porto Ferreira two hours' drive away -- the first time the parade had been called off since the city began organizing the event more than 30 years ago. Porto Ferreira's mayor said the decision was taken to help save the BRL120,000 needed to buy a new ambulance, the report says. Macapa, capital of the northern state of Amapa, and Lavras do Sul in the south have also put festivities on hold, with more municipalities expected to follow suit in the next couple of weeks, notes the report. While unofficial street parties are likely to go ahead, the celebrations are set to be more muted, the report relates. The hedonistic carnival celebration is considered the most important holiday across Brazil, with Rio de Janeiro's spectacular parades attracting close to 1 million tourists last year. While parties fill the streets, the highlight in most cities is the official parade organized by samba schools with the financial backing of the local government, the report relays. Olga Valles, owner of Condal, one of Rio de Janeiro's largest producers of carnival masks, says sales are down almost a third ahead of the year's festivities, notes the report. Ms. Valles admits that she cannot recall a worse year for the business since she arrived from Spain in 1994, the report says. "The economic situation here is even worse than most people imagine. Shops that were spending R$40,000-R$50,000 with us are now placing orders for BRL3,000," the report quotes Ms. Valles as saying. Claudia Sakuraba, who runs the Carnaval Store in Sao Paulo that supplies fabric for more than 90,000 costumes a year, said 2016 looked like being the toughest year since she set up more than a decade ago, with sales 15 per cent lower, the report relays. "So many shops near me have gone bust because of the recession," Ms. Sakuraba said, the report notes. As well as uncertainty over Brazil's economic and political future, the falling real has also made imported fabric more expensive, the report discloses. The gloom is evident in the Getulio Vargas Foundation's consumer confidence index, which has fallen to new lows in recent months, the FT notes. Ms Rousseff's approval ratings have shown a similar trajectory. The report relays that Alberto Ramos, chief Latin America economist at Goldman Sachs, said: "The anxiety is created by a dysfunctional macro picture where growth continues to contract, unemployment is going up and inflation remains in double digits." Brazil's economy contracted 3.7 per cent in 2015, according to economists polled by the central bank, the report discloses. They predict it will shrink by a further 2.99 per cent this year, the report says. The public sourness is all the more acute because many Brazilians believe the economic problems were self-inflicted, FT relays. The report notes that Ms. Rousseff's ruling Workers' party, emboldened by the proceeds of the commodities boom, spent much of its past 13 years in power pursuing populist and expansionary fiscal policies, but ignoring what economists say are the wider structural reforms needed for sustainable growth. While this fiscal largesse helped to lift millions out of poverty and empowered poorer Brazilians, it also paved the way for the current crisis by leaving the economy vulnerable to the collapse in commodities prices, the report notes. Fitch became the second credit rating agency to cut Brazil's debt to junk status amid concerns over its growing fiscal deficit, the report notes. Ms. Rousseff also faces impeachment proceedings, while a vast corruption scandal at Petrobras, the state-controlled oil company, has implicated many in her ruling coalition, the report relays. Poorer Brazilians have on carnival days traditionally worn masks of some of their heroes -- including Ms Rousseff and her predecessor Luiz Inacio Lula da Silva, the report relays. But even they are not popular with revellers this time, according to Ms. Valles, the report says. "Only our witch and monster masks are doing well," Ms. Valles said, notes FT. "Politicians are not having a good year," Ms. Valles added. As reported in the Troubled Company Reporter-Latin America on Dec. 21, 2015, Fitch Ratings has downgraded Brazil's ratings: -- Long-term foreign and local currency Issuer Default Ratings (IDRs) to 'BB+' from 'BBB-', Outlook remains Negative; -- Senior unsecured foreign and local currency bonds to 'BB+' from 'BBB-'; -- Short-term foreign currency IDR to 'B' from 'F3'. EMPRESA DE ENERGIA: Moody's Rates BRL532MM Debentures Ba2/Aa3.br ---------------------------------------------------------------- Moody's America Latina Ltda. assigned Ba2/Aa3.br ratings to the 12-month unsecured BRL532 million debentures with maturity on Dec. 30, 2016, to be issued by Empresa de Energia Sao Manoel S.A. in the local market. RATINGS RATIONALE EDP -- Energias do Brasil S.A. (EDB; Ba2/Aa3.br) will guarantee 66.67% of the debentures and China Three Gorges Brasil Energia Ltda. (CTG Brasil unrated) will guarantee the debentures in proportion to its 33.3% participation in the capital of Sao Manoel through the fiduciary assignment of Banco do Brasil (Baa3 ratings under review for downgrade) deposit certificates with daily liquidity. The credit risk of the fiduciary assignment of Banco do Brasil deposit certificates is ultimately associated with the Baa3 under review for downgrade rating of Banco do Brasil. Moody's views that the debenture rating should reflect the lowest rating among the two guarantees, which is the Ba2/Aa3.br ratings of EDB. The negative outlook reflects EDB's negative outlook. Please refer to the press release for EDB dated June 2, 2015 for further details. Moody's has examined the documentation sent by Sao Manoel mainly consisting of the debenture indenture and guarantees. Moody's understands that based on its best knowledge the corporate guarantee as described in the debenture indenture and the fiduciary assignment of bank deposit certificates, provided by CTG Brasil are legally valid, binding and enforceable. The documents contain language that specifically addresses the irrevocable and irreversible nature of the guarantees provided by EDB and the fiduciary assignment provided by CTG Brasil as described above. Any changes in the guarantee structure could affect the ratings. Sao Manoel will use the debenture proceeds to pay-off the existing BRL 532 million debenture maturing on Jan. 15, 2016. BNDES is expected to take out the BRL 532 million debentures by granting long-term debt within the next 12 months. Sao Manoel will pay interest on a semiannual basis and principal only at the maturity date or when BNDES disburses the funding from the long-term debt before the maturity date of Dec. 30, 2016. What Could Change the Rating-Up In light of EDB's negative outlook, a rating upgrade is unlikely over the near term. What Could Change the Rating-Down A downgrade rating action of EDB's corporate family rating would trigger a downgrade of Sao Manoel's debenture rating. Any changes in the guarantee structure could also trigger a downgrade. The consortium Terra Nova initially formed by EDP - Energias do Brasil (EDB) with a 66.7% participation and Furnas Centrais El‚tricas S.A (Furnas not rated), a full subsidiary of Centrais El‚tricas Brasileiras S.A. (Eletrobras, Ba2 under review for downgrade), with a 33.3% participation won the energy auction coordinated by the Regulator ANEEL on Dec. 13, 2013, to construct and operate the Sao Manoel 700 MW hydro-power project. The consortium was awarded a 30-year concession contract to sell on average 409.5 MW in the regulated market at BRL 83.49 per megawatt hour as of December 2013 to be annually adjusted by the consumer price inflation index (IPC-A). The consortium is committed to start delivering electricity in May 2018. In November 2014, EDB announced it had divested 50% of its 66.7% participation in the capital of Sao Manoel to CWEI Brasil Participacoes Ltda. (CWEI unrated), which had its name changed to China Three Gorges Brasil Energias Ltda. (CTG Brasil unrated) on July 28 2015, a full subsidiary of China Three Gorges Corporation (Aa3 stable). Moody's estimates that Sao Manoel will post annual revenues of around BRL 340 million starting in 2018 as measured by the Brazilian currency's present value. Management estimates that the power project will require around BRL 2.7 billion in total capital expenditures, of which 66% will be funded by long-term financing. BNDES will take out the BRL 532-million bridge loan. The principal methodology used in these ratings was Rating Transactions Based on the Credit Substitution Approach: Letter of Credit-backed, Insured and Guaranteed Debts published in December 2015. ========================== C A Y M A N I S L A N D S ========================== BLUEBAY ASSOCIATES: Shareholders Receive Wind-Up Report ------------------------------------------------------- The shareholders of Bluebay Associates Limited received on Dec. 16, 2015, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Russell Smith c/o BDO CRI (Cayman) Ltd Governor's Square, 2nd Floor-Building 3 23 Lime Tree Bay Avenue P.O. Box 31229 Grand Cayman KY1-1205 Cayman Islands BLUEBAY EMERGING MARKET: Shareholders Receive Wind-Up Report ------------------------------------------------------------ The shareholders of The Bluebay Emerging Market Enhanced Opportunity (Master) Fund Limited received on Dec. 16, 2015, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Russell Smith c/o BDO CRI (Cayman) Ltd Governor's Square, 2nd Floor-Building 3 23 Lime Tree Bay Avenue P.O. Box 31229 Grand Cayman KY1-1205 Cayman Islands BLUEBAY EMERGING MARKET FUND: Shareholders Receive Wind-Up Report ----------------------------------------------------------------- The shareholders of The Bluebay Emerging Market Fixed Income Opportunity Fund Limited received on Dec. 16, 2015, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Russell Smith c/o BDO CRI (Cayman) Ltd Governor's Square, 2nd Floor-Building 3 23 Lime Tree Bay Avenue P.O. Box 31229 Grand Cayman KY1-1205 Cayman Islands BLUEBAY EMERGING FIXED: Shareholders Receive Wind-Up Report ----------------------------------------------------------- The shareholders of The Bluebay Emerging Market Fixed Income Opportunity (Master) Fund Limited received on Dec. 16, 2015, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Russell Smith c/o BDO CRI (Cayman) Ltd Governor's Square, 2nd Floor-Building 3 23 Lime Tree Bay Avenue P.O. Box 31229 Grand Cayman KY1-1205 Cayman Islands BLUEBAY EMERGING INCOME: Shareholders Receive Wind-Up Report ------------------------------------------------------------ The shareholders of The Bluebay Emerging Market Fixed Income Opportunity General Partner Limited received on Dec. 16, 2015, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Russell Smith c/o BDO CRI (Cayman) Ltd Governor's Square, 2nd Floor-Building 3 23 Lime Tree Bay Avenue P.O. Box 31229 Grand Cayman KY1-1205 Cayman Islands BLUEBAY EMERGING OPPORTUNITY: Shareholders Receive Wind-Up Report ----------------------------------------------------------------- The shareholders of The Bluebay Emerging Market Enhanced Opportunity Fund Limited received on Dec. 16, 2015, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Russell Smith c/o BDO CRI (Cayman) Ltd Governor's Square, 2nd Floor-Building 3 23 Lime Tree Bay Avenue P.O. Box 31229 Grand Cayman KY1-1205 Cayman Islands BLUEBAY MACRO GENERAL: Shareholders Receive Wind-Up Report ---------------------------------------------------------- The shareholders of The Bluebay Macro General Partner Limited received on Dec. 16, 2015, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Russell Smith c/o BDO CRI (Cayman) Ltd Governor's Square, 2nd Floor-Building 3 23 Lime Tree Bay Avenue P.O. Box 31229 Grand Cayman KY1-1205 Cayman Islands BLUEBAY MACRO FUND: Shareholders Receive Wind-Up Report ------------------------------------------------------- The shareholders of The Bluebay Macro Fund Limited received on Dec. 16, 2015, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Russell Smith c/o BDO CRI (Cayman) Ltd Governor's Square, 2nd Floor-Building 3 23 Lime Tree Bay Avenue P.O. Box 31229 Grand Cayman KY1-1205 Cayman Islands BLUEBAY MACRO (MASTER): Shareholders Receive Wind-Up Report ----------------------------------------------------------- The shareholders of The Bluebay Macro (Master) Fund Limited received on Dec. 16, 2015, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Russell Smith c/o BDO CRI (Cayman) Ltd Governor's Square, 2nd Floor-Building 3 23 Lime Tree Bay Avenue P.O. Box 31229 Grand Cayman KY1-1205 Cayman Islands COMCEL TRUST: Fitch Affirms BB+ LT Currency Issuer Default Ratings ------------------------------------------------------------------ Fitch Ratings has affirmed the long-term foreign currency and local currency Issuer Default Ratings (IDRs) for Comcel Trust (Comcel) at 'BB+'. The Rating Outlook is Stable. Fitch has also affirmed Comcel's USD800 million senior unsecured notes at 'BB+.' Comcel Trust (Comcel) is a special-purpose vehicle (SPV) created in Cayman Island to issue USD 800 million senior unsecured notes on behalf of Comcel Group (Comcel), a group of several legal entities providing primarily mobile telecommunication services under the Tigo brand. The ratings of the trust are based on the combined credit profile of Comcel, of which entities jointly and severally guarantee the note on a senior unsecured basis. While the company's operational fundamentals and key financial metrics are stable, the ongoing investigation regarding the improper payment on behalf of Comcel, as disclosed in October 2015 by its parent company, Millicom International Cellular S.A. (MIC, rated 'BB+'/Stable Outlook) is credit negative. The timeline or the magnitude of the potential impact stemming from this issue remains largely uncertain at the current juncture. Fitch will closely monitor and take an immediate action, if necessary, when details become available. KEY RATING DRIVERS Leading Market Position Comcel is the largest mobile operator in Guatemala, with a subscriber and EBITDA market share of 55% and 64%, respectively, as of Sept. 30, 2015. The company's entrenched market position is supported by its extensive network coverage, stable quality of service and strong brand recognition under the "Tigo" name. The company is 55% owned by MIC. Fitch Ratings expects Comcel's competitive advantage, partly supported by MIC's industry expertise, to remain intact and help ward off competitive pressures to an extent over the medium term. Slow Mobile Revenue Growth Fitch forecasts that Comcel's top-line growth could be slow, in the low single digits over the medium term, given the maturity of the Guatemalan mobile industry with a penetration rate of 124% as of December, 2015. While continued erosion in its traditional voice revenues is unlikely to be curbed, the strong demand for mobile data, and resultant steady growth in data revenues should help offset this negative impact. Fitch expects that growth in data revenues will continue to be supported by increasing smartphone and data plan adoption rates, estimated to be about 53% and 57% at the end of 2015, respectively. During 2015, the company generated over 83% of total revenues from their mobile segment. Fixed Line Growth Revenue contribution from Tigo Home segment, mainly fixed broadband and cable TV, is likely to undergo strong double digits revenue growth over the medium term given Comcel's increasing network coverage expansion and strategy to consolidate the market by acquiring smaller players. The segment remains relatively underpenetrated and highly fragmented which should provide Comcel with ample room to pursue both organic and inorganic growth. Fitch expects the revenue proportion of Tigo Home segment out of the total sales to increase to above 7% over the medium term, from about 4.2% in 2015. Margins Falling but Still Strong Comcel boasts one of the highest operating margins among the telecom operators in the region with its EBITDA margin of 51% in the LTM ended Sept. 30, 2015. Fitch forecasts the company's EBITDA margin to trend down toward 48% over the long term due to ongoing ARPU erosion and competitive pressures, as well as a revenue mix change with an increasing contribution from lower margin fixed- line and equipment sales. Despite the decline, Fitch acknowledges that the forecasted EBITDA margin, in the range of 48% - 50% during 2015 - 2018, still compares favorably to its regional peers. Moderately Low Leverage Fitch expects Comcel to maintain moderately low leverage for the rating category, with its net debt to EBITDAR at around 1.6x over the medium term, backed by solid operational cash generation. Fitch does not foresee any material improvement in the company's financial profile due to the aggressive shareholder return policy in the medium term. Despite solid cash flow from operations (CFFO), estimated to be above USD500 million which fully covers annual capex of about USD175 million, dividend payments could continue to pressure Comcel's FCF generation into the negative territory. Benign Regulatory Environment The Guatemalan telecom industry has limited regulation, as evidenced by the absence of material intervention in market competition, and/or asymmetrical regulation imposed by the regulatory body. Tariff policies are not subject to the regulatory review, and the interconnection rates are set by private contracts, all of which benefit the incumbent operator. In addition, there is no regulation on number portability. Fitch sees no indication of an adverse change in the regulatory stance that could materially affect operational landscape of Comcel in the near term, which would allow the company to continue to develop business strategies utilizing its largest-scale benefit to maintain its market position. KEY ASSUMPTIONS -- Low single digit revenue growth over the medium term; -- Fixed broadband and cable TV to undergo strong double digits revenue growth over the medium term given Comcel's increasing network coverage expansion and strategy to consolidate the market by acquiring smaller players; -- EBITDA margin to decline towards 48% by 2018 due to margin erosion; increasing contribution from lower margin fixed-line and equipment sales; -- Capex-to-sales ratio estimated to be at around 14% in the short to medium term; -- Negative FCF generation to remain in the short- to medium term given high dividends; -- Net leverage to remain at around 1.6x-1.7x over the medium term. RATING SENSITIVITIES Comcel's rating is closely linked to that of MIC given its strong financial and strategic linkage with the parent. As such, any negative rating action on MIC would also negatively affect Comcel's ratings. Also, a negative rating action could be considered if net debt-to-EBITDAR increases to above 3.0x without a clear path to deleveraging due to any of the following: deterioration in MIC's financial profile leading to more aggressive shareholder distributions, weaker cash generation due to competitive or regulatory pressures on its operations, and M&A activity. Also, any potential material financial impact from the ongoing investigation regarding the improper payment would pressure the ratings. Any positive rating action is unlikely given the aforementioned linkage with MIC, which is also rated at 'BB+', while its foreign currency rating is capped by the country ceiling of Guatemala. LIQUIDITY Comcel has a solid liquidity profile backed by its stable cash flow from operation (CFFO) and well-spread debt maturities. The company refinanced all of its bank loans with the proceeds of USD800 million senior unsecured notes issued during 2014. During 2015, the company also issued a 10 year local currency bank loan for an equivalent of US200 million to improve liquidity, and to fund its capex working capital requirements. Comcel does not face any debt maturity until 2024. FINANCE HOUSE: Shareholders Receive Wind-Up Report -------------------------------------------------- The shareholders of Finance House Sukuk Company I received on Dec. 31, 2015, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Westport Services Ltd. c/o Dominique Massias P.O. Box 1111 Grand Cayman KY1-1102 Cayman Islands Telephone: (345) 949 5122 Facsimile: (345) 949 7920 M SQUARE BRAZIL LONG: Member to Hear Wind-Up Report on Dec. 21 -------------------------------------------------------------- The member of M Square Brazil Value Long Only Master Fund will hear on Dec. 21, 2015, at 11:10 a.m., the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: M Square Investimentos Ltda. c/o Justin Savage Telephone: +1 (345) 949 9876 Facsimile: +1 (345) 949 9877 M SQUARE BRAZIL VALUE: Member to Hear Wind-Up Report on Dec. 21 --------------------------------------------------------------- The member of M Square Brazil Value Long Only Fund, Ltd. will hear on Dec. 21, 2015, at 11:00 a.m., the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: M Square Investimentos Ltda. c/o Justin Savage Telephone: +1 (345) 949 9876 Facsimile: +1 (345) 949 9877 ODEBRECHT OFFSHORE: Fitch Cuts Sr. Secured Notes Rating to 'CCC' --------------------------------------------------------------- Fitch Ratings has downgraded the senior secured notes issued by Odebrecht Offshore Drilling Finance Ltd. (OODFL) to 'CCC', RE80 from 'B-' and affirmed the senior secured notes issued by Odebrecht Drilling Norbe VIII/IX Ltd. at 'B'. Additionally, Fitch removes the ratings from Rating Watch Negative and assigns Odebrecht Drilling Norbe VIII/IX Ltd. a Negative Rating Outlook. A full list of rating actions follows at the end of this release. Fitch's downgrade of the OODFL notes reflects the following: (i) liquidity challenges caused by the cancellation of the Tay IV contracts, resulting in a decrease in the balance of the reserve accounts, (ii) continued deterioration of the environment for offshore drillers, and (iii) the sponsor's ongoing discussions with the OODFL noteholders that have increased Fitch's concerns regarding a potential restructuring of the notes. The rating also considers reduced risk of acceleration of the notes that could have impacted the sponsor's financial profile. A restructuring or exchange of the notes, resulting in a material reduction in economic terms compared with existing contractual terms for the noteholders, in an effort to avert a probable payment default would result in a downgrade of the rating to 'D'. This would reflect the occurrence of a distressed debt exchange according to Fitch's report 'Global Structured Finance Distressed Debt Exchange Criteria'. The affirmation of the Odebrecht Drilling Norbe VIII/IX Ltd notes reflects the following: (i) the reduced risk of a potential acceleration of the OODFL notes, as a result of the forbearance agreement entered with investors, that could have impacted the sponsor's financial profile, (ii) the adequate performance of the underlying assets, and (iii) Fitch's view of the strength of the payment obligation. The Negative Outlook reflects the negative environment for offshore drillers in Brazil. KEY RATING DRIVERS Increased Liquidity Pressure on OODFL As previously noted by Fitch, cancellation of the Tay IV contracts resulted in reduced cashflows to OODFL and increased dependence on cash reserves and sponsor support to make debt service payments. Transaction natural debt service coverage ratios (DSCR) have decreased below 1.0x. OODFL partially used funds from the offshore sinking fund retention account to meet its December's debt payment, reducing the balance of this reserve account to approximately $22 million. The issuer must rely on reserves and any sponsor support to make timely debt service payments. As of September 2015, the total balance of the reserve accounts is approximately $208 million. Continued depletion of cash reserves will also increase the size of the balloon payment, heightening refinancing risk. Reduced Risk of Contagion The sponsor entered into a forbearance agreement with the OODFL noteholders to avoid the acceleration of those notes, reducing the risk of an accelerated deterioration of the sponsor's credit profile which could have potentially affected the sponsor's ability to support the Norbe VIII/IX transaction if needed. The charter and services agreements have termination clauses that include bankruptcy of the sponsor; this risk may be heightened if the credit quality of the sponsor deteriorates. Petrobras' Credit Quality On Dec. 17, 2015, Fitch downgraded the foreign and local currency Issuer Default Ratings (IDRs) of Petrobras to 'BB+' from 'BBB-'. The rating actions follow Fitch's downgrade of Brazil's sovereign foreign and local currency IDRs to 'BB+' from 'BBB-'. The Rating Outlook on the sovereign is Negative. The offtaker's IDR is the starting point for determining the strength of the offtaker's payment obligation. Fitch's View of the Strength of the Payment Obligation Petrobras has demonstrated a willingness to terminate existing charter agreements related to less strategic assets when a termination clause is breached. Although the remaining underlying assets have had an average performance, recurrent periods of downtime would make the contracts more vulnerable for a potential early termination. With current market conditions and market day- rates for UDW assets close to the contracted day-rates for the rigs within the sponsor's fleet, Petrobras may approach the operator in an attempt to restructure certain contracts to reduce expenses over the medium term. Continued pressure on global day- rates and asset values caused by stressed oil prices imply a low likelihood that the underlying assets would be re-contracted in today's environment outside of Brazil and underline the importance of a strong operating performance to avoid any performance-related contract termination. RATING SENSITIVITIES The ratings are sensitive to changes in the credit quality of Petrobras as offtaker, implications of the ongoing investigations on the Odebrecht Group and resolution of Petrobras' temporary ban review, changes in the credit quality of Odebrecht, and the operating performance of the underlying assets. The ratings are also sensitive to a potential restructure of the OODFL notes. Additionally, the ratings are sensitive to changes in the Brazilian oil and gas industry dynamics and on Fitch's perception of the strength of the payment obligation. DUE DILIGENCE USAGE No third party due diligence was provided or reviewed in relation to this rating action. TRANSACTION SUMMARY The Odebrecht Drilling Norbe VIII/IX Ltd notes are backed by the flows related to the charter and services agreements signed with Petrobras for the use of the dynamically positioned UDW drillships Norbe VIII and Norbe IX. The transaction also benefits from a naval mortgage over the vessels. The OODFL notes are currently backed by the flows related to the charter and services agreements signed with Petrobras for the use of the dynamically positioned UDW drillships ODN I and ODN II and the UDW semi-submersible Norbe VI. The transaction also benefits from a naval mortgage over the vessels, including the ODN Tay IV. OOG is the operator of the drilling rigs and primary sponsor of the transactions. OOG is the largest Brazilian operator of UDW rigs chartered to Petrobras, with seven operating UDW rigs in its fleet. Odebrecht Oleo e Gas (OOG, NR), the transaction's sponsor, may approach the OODFL noteholders to renegotiate the terms of the notes. Fitch notes that any potential exchange or restructure of the notes to avert probable payment default and that may affect the economic terms of the notes, even if agreed upon by the noteholders, may be considered by Fitch as a Distressed Debt Exchange as described in Fitch's 'Global Structured Finance Distressed Debt Exchange Criteria'. RECOVERY ESTIMATES Fitch assigns a recovery estimate (RE) of RE80 to the OODFL notes. Fitch assigns REs to all classes rated 'CCC' or below. REs are forward-looking, taking into account Fitch's expectations for principal repayments on a distressed structured finance security. Fitch's RE considers estimated cash reserves and underlying asset values as reflected by a discounted cash flow analysis of net revenues generated during the remaining useful life of the contracted vessels (including cashflows generated under the Petrobras' contracts) and potential liquidation of Tay IV. REs are not intended to represent the actual recovery noteholders may get upon sale of the underlying vessels or potential restructuring of the notes. Fitch has taken the following rating actions: OODFL -- Series 2013-1 senior secured notes downgraded to 'CCC', RE80 from 'B-' -- Series 2014-1 senior secured notes downgraded to 'CCC', RE80 from 'B-' Odebrecht Drilling Norbe VIII/IX Ltd. -- Series 2010-1 senior secured affirmed at 'B'. The Rating Outlook is Negative. PRENTICE LONG/SHORT: Members Receive Wind-Up Report --------------------------------------------------- The members of Prentice Long/Short Equity Master, LP received on Dec. 16, 2015, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: John Sutlic P.O. Box 30902 Grand Cayman KY1-1204 Cayman Islands Telephone: (345) 938-2707 WMG CONCENTRATED: Shareholders Receive Wind-Up Report ----------------------------------------------------- The shareholders of WMG Concentrated Fund Limited received on Dec. 2, 2015, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Richard Fear c/o Ryan Charles P.O. Box 2681 Grand Cayman KY1-1111 Cayman Islands Telephone: (345) 814 7364 Facsimile: (345) 945 3902 YPF ECUADOR: Shareholder Receives Wind-Up Report ------------------------------------------------ The shareholder of YPF Ecuador, Inc. received on Nov. 23, 2015, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Carlos Alberto San Juan Macacha Guemes 515, C1106BKK Buenos Aires Argentina ========= C H I L E ========= SOCIEDAD DE INVERSIONES: S&P Lowers CCR to 'B-'; Outlook Stable --------------------------------------------------------------- Standard & Poor's Ratings Services lowered its corporate credit and issue-level ratings on Pampa [Sociedad de Inversiones Pampa Calichera S.A] to 'B-' from 'B'. The outlook is stable. Additionally, S&P removed the UCO identifier from the ratings following the Jan. 5, 2016 publication of the NCEI criteria. The downgrade reflects S&P's review of Pampa's credit quality after the implementation of the new criteria for NCEIs. The ratings on Pampa reflect the company's limited ability to liquidate investments. Even though Sociedad Quimica y Minera de Chile S.A. (SQM; BBB/Negative/--), Pampa's unique underlying asset, is public and there is a relatively deep market for its shares, Pampa's reluctance to lose control of SQM limits its willingness to divest. In addition, because SQM's business is in commodities, its net income is inherently volatile, as are its dividend payments, given that net income is the basis for calculating dividends. The stable outlook incorporates the group's manageable debt maturity profile in the next 12 months and Pampa's track record of refinancing maturities in the domestic market. S&P could lower the ratings in the next 12 months if the company's liquidity weakens and its refinancing risk increases, particularly in light of its upcoming maturities, totaling $200 million, most of which will come due by the end of 2017. If S&P forecasts an imminent risk of covenant breach, it could also take a negative rating action. S&P could raise the ratings if the company's interest coverage ratio improves to above 1.5x on a sustained basis, which S&P sees as unlikely in the short term. =============== C O L O M B I A =============== El QUIMBO: Hydro-Power Plant Back in Operation ---------------------------------------------- EFE News reports that El Quimbo, a hydroelectric power plant in the southern Colombian province of Huila and the second-largest facility of its kind in South America, is functioning normally after temporarily restarting over the weekend, plant operator Emgesa said. "Having completed the first 24 hours of operation, the result is positive, both in technical and environmental terms, and the preventive measures taken by the company to start operations proved to be effective and no unforeseen impacts occurred," Emgesa said in a statement obtained by the news agency. El Quimbo, which generates 5 percent of the electricity consumed in Colombia, had been shut down by a court on the grounds that the failure to remove wood and biomass from the dam before refilling would harm the environment, the report notes. President Juan Manuel Santos called on the courts several times to allow the hydroelectric power plant to operate due to the drought caused by the El Nino weather phenomenon, which has lowered river and reservoir levels, the report discloses. "No fish kills were registered in the reservoir in Betania (Huila) as a result of the power plant's operation," Emgesa, a unit of Italian energy company Enel, said, the report relays. Water releases were kept at maximum and permanent flows to "control the oxygen levels of the water" that was retained for several days, "allowing this water to mix with cycled water, reaching oxygen levels above those considered acceptable under Colombian environmental legislation," Emgesa said, the notes. The Emergency Fish Rescue Program was reactivated and the "presence of odors was not detected" during the first 24 hours, the company said, EFE News says. A court in Neiva, the capital of Huila, allowed the power plant to be restarted in response to an appeal filed by the Santos administration, the report discloses. El Quimbo, a project that required an investment of more than $1.2 billion, was awarded in March 2008 to Bogota-based Emgesa, adds EFE News. =================================== D O M I N I C A N R E P U B L I C =================================== DOMINICAN REP: Official Admits High Fuel Taxes, Offers Little Hope ------------------------------------------------------------------ Dominican Today reports that industry and Commerce minister Jose del Castillo admitted the country's fuel taxes are among the world's highest, and should be a topic to discuss in next fiscal pact. Mr. del Castillo said taxes and profit margins on fuels, which together surpass 60 percent, circumvent significant falls in local prices despite the collapse in global oil prices, according to Dominican Today. Mr. del Castillo acknowledged citizens' concerns and complaints against high local prices on oil derivatives, but noted that taxes pay the foreign debt which he affirms dates back to the mid-1990s, the report notes. As reported in the Troubled Company Reporter-Latin America on Dec. 3, 2015, Fitch Ratings affirmed the Dominican Republic's long-term foreign and local currency Issuer Default Ratings (IDRs) at 'B+'. The Rating Outlooks on the long-term IDRs are revised to Positive from Stable. The issue ratings on the Dominican Republic's senior unsecured foreign and local currency bonds are affirmed at 'B+'. The Country Ceiling is affirmed at 'BB-' and the short-term foreign currency IDR at 'B'. DOMINICAN REPUBLIC: Eyes Energy Pact Years in the Making -------------------------------------------------------- Dominican Today reports that the meetings leading to a national pact over the electricity sector will resume, after the work sessions were suspended for the holidays. Representatives from labor unions, businesses and civil society are expected to work with government officials in groups on a number of proposals to discuss the proposed pact, according to Dominican Today. A number of preliminary agreements have already been hammered out during discussions by a number of teams from the various sectors, including that government representatives must provide a range of information required by the Economic and Social Council (CES), the report notes. Government officials say all the information required thus far is available on the electricity pact website, the report says. Around five work sessions have been held thus far in which a number of the points of consensus have been addressed toward establishing a roadmap for the agreement years in the making, the report adds. As reported in the Troubled Company Reporter-Latin America on Dec. 3, 2015, Fitch Ratings affirmed the Dominican Republic's long-term foreign and local currency Issuer Default Ratings (IDRs) at 'B+'. The Rating Outlooks on the long-term IDRs are revised to Positive from Stable. The issue ratings on the Dominican Republic's senior unsecured foreign and local currency bonds are affirmed at 'B+'. The Country Ceiling is affirmed at 'BB-' and the short-term foreign currency IDR at 'B'. ==================== E L S A L V A D O R ==================== REGAL FOREST: Fitch Affirms 'BB-' Long-term FC and LC IDR --------------------------------------------------------- Fitch Ratings has affirmed Regal Forest Holding Co. Ltd ratings (Grupo Unicomer) as follows: -- Long-term Local currency Issuer Default Rating (IDR) at 'BB-'; -- Long-term Foreign currency IDR at 'BB-'. The Rating Outlook is Stable. The ratings reflect the company's leading business position in most of the countries where it operates. The ratings incorporate Grupo Unicomer's geographic and format diversification that have contributed to positive consolidated cash flows from operations throughout economic cycles. The ratings incorporate Grupo Unicomer's track record of stable operational results based on a business model that targets low-income to middle-income segments, which represent the majority of the population in those countries where the company operates, through several retail formats. The ratings also consider the operating experience, track record and solid financial position of its shareholders Milady Group (Milady) from El Salvador and El Puerto de Liverpool, S.A.B. de C.V. (Liverpool) from Mexico (rated 'BBB+'/Outlook Positive). Grupo Unicomer's ratings are limited by its operating environment considering the countries where it operates and its growth strategy through acquisitions, funded mainly with debt. The ratings also factor the company's credit risk from its consumer finance unit with around 37% overdue accounts receivable (1+ days overdue) as of last 12 months (LTM) Sept. 30, 2015 (past due accounts for 90 days or more were 7.7%); although this risk is mitigated somehow by the company's collection procedures and the portfolio's financial spreads. KEY RATING DRIVERS Operating Environment and Geographic & Format Diversification Incorporated: Grupo Unicomer has commercial operations in 21 countries around Central America, South America and the Caribbean. The company maintains a leading business position in the commercialization of consumer durables goods in most of the countries where it operates, supported by economies of scale in terms of purchasing power and logistics. Geographic diversification allows Grupo Unicomer to have a broad revenue base supported by different economic dynamics and somehow mitigates the company's country risk of most of its markets, within the B rating category. The company has more than 15 years of track record in the consumer durables commercialization, which has enabled to develop long-term relationships with suppliers and to have competitive advantages in terms of location of its stores within small countries where prime retailing points of sale are very limited. Positive Cash Flow from Operations: Historically, Grupo Unicomer has consistently maintained positive cash flow from operations (CFFO) throughout economic cycles. The company had adjusted its operations well during economic downturns by restricting credit origination, reducing bank debt and improving its product mix in order to protect its operating cash flows. Grupo Unicomer's CFFO has been robust enough to fund capex and dividend payments during the years. However, new acquisitions have been financed mostly with debt. For the LTM ended September 2015, the company generated USD74.5 million of CFFO, which financed capex of USD22.8 million and dividends of USD16.5 million, resulting in a free cash flow (FCF) of USD35.2 million. The company's CFFO is expected to remain positive during 2016- 2019. Grupo Unicomer is executing an important investment plan during the next four years in order to keep its business position and recover the profitability margins it had in the past (14% of EBITDA margin). Capex levels should be around USD36.7 million per year during the medium term excluding potential acquisitions. Shareholders' Sound Financial Position: The ratings consider the sound financial position of Grupo Unicomer's shareholders Milady (50%) and Liverpool (IDR 'BBB+'/Outlook Positive; 50%), with a proven track record in retail since 1847. Milady's operations include real estate developments, department store chains and all Inditex's franchises in Central America. Liverpool, a department store with 109 units and 25 shopping malls in Mexico, had USD5.8 billion in total revenues in the LTM ended September 2015 with 16.3% of EBITDA margin. Liverpool's total adjusted debt/EBITDAR was 1.2x for the same period. Ambitious Growth Funded Mainly with Debt: Historically, Grupo Unicomer has expanded its operations through a combination of organic and inorganic growth. Since its beginnings, the company has done five important acquisitions that increased its size and coverage. While organic growth was primarily funded with internal operating cash flows, acquisitions were funded mainly with debt. The last important acquisition was Gollo in Costa Rica (115 stores by the time of acquisition in 2012), which increased the company's adjusted leverage to 4.6x from 3.8x. Grupo Unicomer has been slowly improving this ratio through the years. As of September 2015, lease adjusted debt to EBITDAR was 4.3x and Fitch expects the company to maintain this ratio in the 3.5x to 4.5x range over the medium term. Moderate Level of Overdue Accounts Offset by Financial Spread: The company's consumer finance strategy includes enough financial spreads to cover credit risks associated with the portfolio. During the last four years, the portfolio yield after deducting uncollectable expenses and write offs has been 40% on average. As of Sept. 30, 2015, Grupo Unicomer's portfolio had an average of 37% of overdue accounts (more than one day overdue) and 7.7% of non-performing loans (past due accounts for 90 days or more). These compare negatively to 34% and 6.7% presented in March 2015, respectively, due to a reduction in the portfolio as well as the challenging economic and political conditions in the region. As of September 2015, the company has reserves equivalent to 93% of those non-performing loans. The level of overdue accounts is partially offset by the company's efficient collection program and portfolio yield. KEY ASSUMPTIONS Fitch's key assumptions within the rating case for Grupo Unicomer include: -- Revenue growth of 4.4% on average for 2016-2019; -- EBITDA margin of 12% for year-end 2016 and close to 13% going forward; -- Positive CFFO for 2016 and going forward; -- Adjusted leverage to EBITDAR of 3.7x-4.5x in the medium term; -- Dividends payment of 25% of net income for 2016-2019; -- Stable portfolio credit quality; -- Acquisition of Electro Facil in Paraguay during December 2015. RATING SENSITIVITIES Future developments that may individually or collectively lead to a positive rating action include: adjusted leverage below 3.5x on a sustained basis, significant reduction on its current maturities that result in a consistent ratio of cash plus CFFO-to-short-term debt of 1.0x. Future developments that may individually or collectively lead to a negative rating action include: deterioration in overdue accounts from the consumer finance business, significant reduction in cash flow generation, further debt-financed acquisition activity resulting in an adjusted debt to EBITDAR ratio above 5x and/or deterioration of liquidity compared to short-term debt. LIQUIDITY Liquidity is adequate for the rating category. The company's main source of liquidity is internal cash generation consisting of positive CFFO. Cash and equivalents of USDD44 million and a short- term receivables portfolio of USD529 million further support the company's liquidity. The company's liquidity ratio, measured as FCF plus cash and marketable securities over debt service coverage was 0.4x as of Sept. 30, 2015; including account receivables in the calculation the ratio increases to 2.2x. As of Sept. 30, 2015, Grupo Unicomer reported total adjusted debt of USD1 billion, of which USD250 million was classified as short- term. This level of current debt compares with USD44.3 million of cash and marketable securities and USD60 million of uncommitted undrawn revolving credit facilities. The company benefits from sales coming during the holiday season (approximately 34% of total revenues) and from potential liquidity of its USD529 million of current account receivables from the consumer finance unit. ================= G U A T E M A L A ================= BANCO AGROMERCANTIL: Fitch Hikes LT FC IDR to 'BB+' --------------------------------------------------- Following Bancolombia S.A.'s (Bancolombia) recent acquisition of a majority stake of Grupo Agromercantil Holding, S.A. (GAH), Fitch Ratings has upgraded the long-term foreign currency Issuer Default Ratings (IDRs) of Banco Agromercantil de Guatemala, S.A. (BAM) and Agromercantil Senior Trust's senior unsecured notes (AST) to 'BB+' from 'BB' and their long-term local currency IDRs to 'BBB-' from 'BB'. Also, Fitch has upgraded BAM and Mercom Bank Limited's (Mercom) long-term national ratings to 'AAA(gtm)' from 'A+(gtm)'. BAM, Mercom and AST's ratings have been removed from Rating Watch Positive, which it was placed on Oct. 30, 2015, and assigned a Stable Rating Outlook. This transaction has no impact on BAM's Viability Rating (VR) as it reflects the bank's intrinsic credit profile. See the full list of rating actions at the end of this release. The ratings upgrades are based on Fitch's view of Bancolombia's ability and propensity to support GAH and its subsidiaries if needed, even in the event of sovereign or macroeconomic stress in Guatemala (local and foreign currency IDRs of 'BB' with Stable Outlook). The transaction to increase Bancolombia's stake in GAH to 60% from 40% was completed on Dec. 30, 2015. KEY RATING DRIVERS BAM's IDRs, NATIONAL RATINGS AND SUPPORT RATINGS BAM's IDRs and national ratings reflect Fitch's opinion that the support from its ultimate shareholder, Bancolombia ('BBB+'/Stable Outlook) will be timely and sufficient if needed. In the agency's opinion, BAM is an important subsidiary for Bancolombia, based on its role in Bancolombia's expansion and diversification in Central America. Bancolombia's propensity to support its new subsidiaries is influenced by the relevant reputational risk that a default from any of these entities would pose to Bancolombia, resulting in a Support rating of '3'. According to Fitch estimates, BAM accounted for approximately 5% of Bancolombia's consolidated assets (including BAM's assets) and consolidated net income, as of September 2015. MERCOM'S NATIONAL RATINGS Mercom's national ratings are based on the support it would receive from its ultimate shareholder, Bancolombia, if needed. Mercom is an important subsidiary for the group in Guatemala given it operates in complementary market segments enhancing BAM's business model and reflects a high degree of integration. AST AST's rating is aligned with BAM's IDR reflecting that the senior unsecured obligations rank equally with the bank's unsecured and unsubordinated obligations. RATINGS SENSITIVITIES BAM BAM's foreign currency IDR is capped by Guatemala's country ceiling. The bank's long-term local currency IDR is above the sovereign's local currency IDR and as such would be sensitive to any sovereign rating action. Downward risk for the bank's IDRs, national ratings and support rating is limited given its parent support but the ratings could be downgraded if Fitch's assessment of Bancolombia's ability or willingness to support its subsidiaries changes. Currently, there is no upside potential for the bank's IDRs as these are above the sovereign's IDRs, which have a Stable Outlook. MERCOM A downgrade in Mercom's ratings is contingent on Bancolombia's ability and propensity to support its operations if needed. AST Changes in the notes' rating would derive from changes in the same direction in BAM's IDR. Fitch has taken the following rating actions: Banco Agromercantil de Guatemala, S.A. -- Long-term foreign currency IDR upgraded to 'BB+' from 'BB'; -- Short-term foreign currency IDR affirmed at 'B'; -- Long-term local currency IDR upgraded to 'BBB-' from 'BB'; -- Short-term local currency IDR upgraded to 'F3' from 'B'; -- Support rating upgraded to '3' from '5'; -- Support rating floor of 'NF' was withdrawn. -- National scale long-term rating upgraded to 'AAA(gtm)' from 'A+(gtm)'; -- National scale short-term rating upgraded to 'F1+(gtm)' from 'F1(gtm)'. Agromercantil Senior Trust -- Long-term foreign currency loan participation notes upgraded to 'BB+' from 'BB'. Mercom Bank Limited -- National scale long-term rating upgraded to 'AAA(gtm)' from 'A+(gtm)'; -- National scale short-term rating upgraded to 'F1+(gtm)' from 'F1(gtm)'. The ratings were removed from Rating Watch Positive and assigned a Stable Outlook. The following rating is unaffected: Banco Agromercantil de Guatemala, S.A. -- Viability Rating of 'bb'. ====================== P U E R T O R I C O ====================== GOODMAN AND DOMINGUEZ: Files for Chapter 11 Bankruptcy Protection ----------------------------------------------------------------- Goodman and Dominguez, Inc., filed for Chapter 11 bankruptcy protection (Bankr. S.D. Fla. Case No. 16-10056) on Jan. 4, 2016, estimating its assets and liabilities at between $1 million and $10 million each. The petition was signed by David Goodman, president. Emon Reiser at South Florida Business Journal reports that the Company filed for bankruptcy, citing increasing pressure from online shopping. The Company's owner seeks to close stores and restructure operational costs, the report states. According to Business Journal, the Company's 608 workers are owed $300,000 in wages. Business Journal adds that the Company also owes: -- Forever Link Int'l Inc., which holds an unsecured claim of $2.4 million; -- Hana Financial Inc., which has an unsecured claim of $524,184; and -- Yoki Fashion International LLC, which has an unsecured claim of $226,036. Judge Robert A Mark presides over the case. Peter D. Russin, Esq., at Meland Russin & Budwick, P.A., serves as the Company's bankruptcy counsel. Goodman and Dominguez, Inc. -- dba Traffic, Traffic Shoe, Goodman & Dominguez, Inc., Traffic Shoes, and Traffic Shoe, Inc. -- is a retailer headquartered in Medley, Florida. It operates 83 stores in malls across nine states and Puerto Rico. It also sells its teen fashion products at trafficshoe.com. MANUEL MEDIAVILLA: Directed to File Amended Joint Plan ------------------------------------------------------ PRLP 2011 Holding, LLC, the individual and corporate debtors, Manuel Mediavilla, Maydin G. Melendez and Manuel Mediavilla, Inc., filed cross motions for partial reconsideration of the Opinion and Order entered on June 16, 2015, denying the Joint Plan's confirmation for failure to provide for the Debtors' substantive consolidation of the two cases. In an Opinion and Order dated December 30, 2015, which is available at http://is.gd/cpsqThfrom Leagle.com Judge Mildred Caban Flores of the United States Bankruptcy Court for the District of Puerto Rico denies PRLP's motion for partial reconsideration and grants the Debtors' motion for reconsideration in part. The Debtors are ordered to file an amended Joint Plan to provide for post-petition interest paid to PRLP's secured claim classified under Classes 4A and 4B of the Joint Plan subject to conditions within 30 days. The cases are IN RE: MANUEL MEDIAVILLA, INC., Chapter 11, Debtor; IN RE: MANUEL MEDIAVILLA AND MAYDIN G. MELENDEZ, Chapter 11, Debtors, Case Nos. 13-2800 (MCF), 13-2802 (MCF)(Bankr. D.P.R.). Manuel Mediavilla, Inc., aka Muebleria Mediavill, sought protection under Chapter 11 of the Bankruptcy Code on April 11, 2013 (Bankr. D.P.R., Case No. 13-02800). The case is assigned to Judge Mildred Caban Flores. *********** 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 2016. 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. 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