/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/160722.mbx T R O U B L E D C O M P A N Y R E P O R T E R L A T I N A M E R I C A Friday, July 22, 2016, Vol. 17, No. 144 Headlines B E R M U D A ENERGY XXI: Seeks Plan Filing Deadline Extension to Oct. 11 B R A Z I L MRS LOGISTICA: S&P Affirms 'BB' Ratings; Outlook Remains Negative ODEBRECHT SERVICOS: Puts Braskem Stake as Collateral for Loans OI SA: Brazil Recommends 4 Firms for In-Court Administrator Role C A Y M A N I S L A N D S BECA MACRO: Creditors' Proofs of Debt Due Aug. 19 BULOH INVESTMENT: Creditors' Proofs of Debt Due Aug. 15 CALIBE INVESTMENT: Creditors' Proofs of Debt Due Aug. 15 CHESAPEAKE PARTNERS: Commences Liquidation Proceedings DANVI MANAGEMENT: Creditors' Proofs of Debt Due Aug. 15 FUTURE LTD: Creditors' Proofs of Debt Due Aug. 15 GOLDHORSE FUND: Placed Under Voluntary Wind-Up KAZAR LIMITED: Commences Liquidation Proceedings MSN 2441: Commences Liquidation Proceedings SUPER MPAM: Creditors' Proofs of Debt Due July 30 TOPAZ PROPERTIES: Creditors' Proofs of Debt Due Aug. 10 VSK (CPO): Placed Under Voluntary Wind-Up WILLOW INVESTMENT: Creditors' Proofs of Debt Due Aug. 15 D O M I N I C A N R E P U B L I C DOMINICAN REPUBLIC: Highlands Vegetable Growers Could Go Under M E X I C O STATE OF CHIHUAHUA: Moody's Cuts Issuer Ratings to Ba3/Baa1.mx P U E R T O R I C O INSTITUTO MEDICO: Patient Care Ombudsman Issues Monitoring Report MORGANS HOTEL: Amends Schedule 13E-3 Transaction Statement PUERTO RICO PUBLIC: S&P Lowers Rating on Series 2011A Bonds to D T R I N I D A D & T O B A G O TRINIDAD & TOBAGO: Biggest Problems are Corruption & Laundering V E N E Z U E L A VENEZUELA: Bonds Propelled by Speculation PDVSA is Eyeing Swap - - - - - ============= B E R M U D A ============= ENERGY XXI: Seeks Plan Filing Deadline Extension to Oct. 11 ----------------------------------------------------------- BankruptcyData.com reported that Energy XXI filed with the U.S. Bankruptcy Court a motion to extend the exclusive period during which the Company can file a Chapter 11 plan and solicit acceptances thereof through and including October 11, 2016 and December 11, 2016, respectively. The motion explains, "The Debtors are currently on track to achieve their restructuring goals of eliminating substantially all of their funded indebtedness on an accelerated basis and emerging from chapter 11 better positioned to weather the challenges facing their offshore competitors. The Debtors' Proposed Joint Chapter 11 Plan of Reorganization provides for a recovery for a number of stakeholders, including general unsecured creditors. The Debtors are scheduled to commence the hearing on the confirmation of the Plan of Sep. 13, 2016 and expect to have the support of the First Lien Agent and the Steering Committee, the Ad Hoc Committee of Second Lien Noteholders, and certain other important stakeholders. The Debtors are cautiously optimistic that they will also have the support of the Official Committee of Unsecured Creditors appointed in these chapter 11 cases by that time and are hopeful they can reach a global compromise that all parties in interest support. In an abundance of caution, however, the Debtors seek an extension of the exclusivity periods in which the Debtors may file and solicit acceptances of a chapter 11 plan of reorganization. The Debtors believe that maintaining the exclusive right to file and solicit votes on a plan of reorganization is critical to finalizing the value-maximizing restructuring contemplated by the Plan. Extending the exclusivity periods will afford the Debtors and their stakeholders time to confirm the Plan, finalize the transactions contemplated thereby, and proceed toward emergence from bankruptcy in an efficient and organized fashion." The Court scheduled an Aug. 11, 2016 hearing on the motion. About Energy XXI, Ltd. Energy XXI Ltd (OTCMKTS: EXXIQ) was incorporated in Bermuda on July 25, 2005. With its principal operating subsidiary headquartered in Houston, Texas, Energy XXI is engaged in the acquisition, exploration, development and operation of oil and natural gas properties onshore in Louisiana and Texas and in the Gulf of Mexico Shelf. Energy XXI Ltd and 25 of its affiliates filed on April 14, 2016, bankruptcy petitions in the U.S. Bankruptcy Court for the Southern District of Texas (Bankr. S.D. Tex. Lead Case No. 16-31928). The petitions were signed by Bruce W. Busmire, the CFO. Judge Karen K. Brown is assigned to the cases. Energy XXI Ltd on April 14, 2016, also filed a winding-up petition commencing an official liquidation proceeding under the laws of Bermuda before the Supreme Court of Bermuda. The Debtors sought bankruptcy protection after reaching a deal With lenders on the filing of a restructuring plan that would convert $1.45 billion owed to second lien noteholders into equity of the reorganized company. The Debtors have hired Vinson & Elkins LLP as counsel, Gray Reed & McGraw, P.C. as special counsel, Conyers Dill & Pearman as Bermuda counsel, Locke Lord LLP as regulatory counsel, PJT Partners LP as investment banker, Opportune LLP as financial advisor, Epiq Systems, Inc., as notice and claims agent. Wilmer Cutler Pickering Hale and Dorr LLP represent an ad hoc group of certain holders and investment advisors and managers for holders of obligations arising from the 8.25% Senior Notes due 2018 issued pursuant to that certain Indenture, dated as of Feb. 14, 2011, by and among EPL Oil & Gas, Inc., certain of EPL's subsidiaries, as guarantors, and U.S. Bank National Association, as trustee. The Office of the U.S. Trustee on April 26, 2016, appointed five creditors of Energy XXI Ltd. to serve on the official committee of unsecured creditors. The Committee retains Heller, Draper, Patrick, Horn & Dabney LLC as its co-counsel, Latham & Watkins LLP as its co-counsel, and FTI Consulting, Inc. as its financial advisor. =========== B R A Z I L =========== MRS LOGISTICA: S&P Affirms 'BB' Ratings; Outlook Remains Negative ----------------------------------------------------------------- S&P Global Ratings affirmed its 'BB' global scale and 'brAA-' Brazilian national scale ratings on MRS Logistica S.A. (MRS). S&P has affirmed its 'brAA-' issue-level ratings on MRS's senior unsecured debentures. The outlook on the corporate credit ratings remains negative. The recovery ratings on MRS's senior unsecured debt remain unchanged at '3', reflecting a meaningful recovery of 50%-70% (in the higher end of the range). The ratings on MRS reflect the resiliency of its cash flows, stemming from rising transported volumes over the next several quarters, despite Brazil's recession. This, combined with MRS's sound operating efficiency in the form of above-industry-average EBITDA margins and strong free operating cash flow (FOCF), reflects the company's 'bb+' SACP. S&P continues to cap MRS's ratings at Brazil's sovereign rating level, given that the company doesn't pass the sovereign stress test. This is due to high short-term maturities and maintenance capex needs, cash flows' vulnerability to lower volumes and payment delinquency from some of its main clients, as well as restrictions to access MRS's cash investments. S&P continues to view the railroad industry in Brazil as having high sensitivity to a sovereign default. This reflects MRS's revenue generation from domestic clients and that a sovereign default could squeeze its cash flows from clients with weaker credit quality, given the lack of credit availability and growing costs. This, combined with the company's significant short-term maturities and maintenance capital expenditures needs, would likely result in insufficient liquidity in the stress scenario. The negative outlook on MRS mirrors that of the sovereign of Brazil and reflects S&P's belief that amid its current capital structure, it could downgrade the company if S&P was to lower Brazil's sovereign rating. This would reflect S&P's view that under a sovereign stress scenario, MRS's liquidity could be impaired. S&P could also lower MRS's SACP either if its financial metrics weaken significantly, resulting in debt to EBITDA consistently above 5x and FFO to debt below 12%, or if the company's liquidity position weakens. These ratios could result from weaker operating efficiency and high capex. An upgrade is unlikely in the near term as the ratings are currently capped by the foreign currency rating of Brazil. S&P could upgrade MRS if Brazil's ratings were upgraded and the company continues to present strong operating performance that would support S&P's view of stable financial metrics even during the more challenging market conditions, resulting in debt to EBITDA remaining close to 3.0x and FFO to debt above 20%. ODEBRECHT SERVICOS: Puts Braskem Stake as Collateral for Loans -------------------------------------------------------------- Guillermo Parra-Bernal at Reuters reports that Braskem SA said controlling shareholder Odebrecht Servicos e Participacoes SA has placed the entire stake it has in the firm as collateral for outstanding bank loans, in a sign of Odebrecht's challenging debt refinancing outlook. No details on the accord between Odebrecht Serviáos, a subsidiary of Grupo Odebrecht SA, and lenders were disclosed in a securities filing by Braskem, according to Reuters. Odebrecht Serviáos, a unit of Latin America's largest engineering group, has voting control of Braskem despite having a 38 percent stake in Latin America's biggest petrochemical firm, the report notes. Grupo Odebrecht is selling assets and renegotiating about 35 billion reais ($10.8 billion) in loans, a little more than a year after being targeted in Brazil's widest ever corruption probe. Marcelo Odebrecht, the family scion and former chief executive officer of the namesake group, was sentenced to 19 years in jail for his role in the corruption scandal known as "Operation Car Wash," the report relays. The scandal has undercut Grupo Odebrecht's access to debt financing, and some of the conglomerate's 15 business units are currently undertaking separate debt renegotiation and restructuring efforts. Reuters reported in March that Grupo Odebrecht was considering exiting Braskem, the report notes. State-controlled Petroleo Brasileiro SA, Grupo Odebrecht's other partner in Braskem with a 36 percent stake, decided to exit the petrochemical firm in January, sources told Reuters at the time. Petrobras, as the state oil firm is known, is also under investigation in the Car Wash probe. OI SA: Brazil Recommends 4 Firms for In-Court Administrator Role ---------------------------------------------------------------- Guillermo Parra-Bernal at Reuters reports that Brazil's telecommunications industry watchdog Anatel proposed a list of four candidates to become the in-court administrator of phone carrier Oi SA, which last month filed for the nation's biggest- ever reorganization. Brasilia-based Anatel picked Alvarez & Marsal Holdings LLC, BDO LLP, Deloitte & Touche LLP and PricewaterhouseCoopers as candidates for the role, Anatel said in a statement, according to Reuters. The list was sent to Fernando Cesar Ferreira Viana, a Rio de Janeiro judge overseeing Oi's bankruptcy protection proceedings, the statement said, the report notes. Anatel asked Mr. Viana to assess whether business relations between PricewaterhouseCoopers, Deloitte and Oi would present a conflict of interest, ther eport relays. Reuters reported on July 8 that Alvarez & Marsal, PricewaterhouseCoopers and Deloitte were shortlisted for the role. About Oi SA Headquartered in Rio de Janeiro, and operating almost exclusively within Brazil, the Oi Group provides services like fixed-line data transmission and network usage for phones, internet, and cable, Wi-Fi hot-spots in public areas, and mobile phone and data services, and employs approximately 142,000 direct and indirect employees. Ojas N. Shah filed a Chapter 15 petition for Oi S.A. (Bankr. S.D.N.Y. Case No. 16-11791), Oi Movel S.A. (Bankr. S.D.N.Y. Case No. 16-11792), Telemar Norte Leste S.A. (Bankr. S.D.N.Y. Case No. 16-11793), and Oi Brasil Holdings Cooperatief U.A. (Bankr. S.D.N.Y. Case No. 16-11794) on June 21, 2016. The case is assigned to Judge Sean H. Lane. The Chapter 15 Petitioner is represented by John K. Cunningham, Esq., and Mark P. Franke, Esq., at White & Case LLP, in New York; and Jason N. Zakia, Esq., Richard S. Kebrdle, Esq., and Laura L. Femino, Esq., at White & Case LLP, in Miami, Florida. ========================== C A Y M A N I S L A N D S ========================== BECA MACRO: Creditors' Proofs of Debt Due Aug. 19 ------------------------------------------------- The creditors of Beca Macro Commodities Fund are required to file their proofs of debt by Aug. 19, 2016, to be included in the company's dividend distribution. The company commenced liquidation proceedings on June 15, 2016. The company's liquidator is: Kristoffer Huldt IFIT Fund Services AG Voltastrasse 61 P.O. Box 2520 CH-8033, Zurich Switzerland Telephone: +41 44 366 4016 Facsimile: +41 44 366 4039 e-mail: kh@ifit.net BULOH INVESTMENT: Creditors' Proofs of Debt Due Aug. 15 ------------------------------------------------------- The creditors of Buloh Investment Ltd. are required to file their proofs of debt by Aug. 15, 2016, to be included in the company's dividend distribution. The company commenced liquidation proceedings on June 30, 2016. The company's liquidator is: SCTS Capital PTE. Ltd. c/o Ian Phillips Telephone: (345) 749-3344 Facsimile: (345) 749-2230 Suite 4210, 2nd Floor Canella Court 48 Market Street, Camana Bay P.O. Box 32203 Grand Cayman KY1-1208 Cayman Islands CALIBE INVESTMENT: Creditors' Proofs of Debt Due Aug. 15 -------------------------------------------------------- The creditors of Calibe Investment Ltd. are required to file their proofs of debt by Aug. 15, 2016, to be included in the company's dividend distribution. The company commenced wind-up proceedings on July 6, 2016. The company's liquidator is: Morval Bank & Trust Cayman Ltd. Telephone: +1 (345) 949-9808 P.O. Box 30622 Grand Cayman KY1-1203 Cayman Islands CHESAPEAKE PARTNERS: Commences Liquidation Proceedings ------------------------------------------------------ On July 1, 2016, the shareholders of Chesapeake Partners Master Fund, Ltd. resolved to voluntarily liquidate the company's business. Creditors are required to file their proofs of debt to be included in the company's dividend distribution. The company's liquidator is: Mark Lerner 2800 Quarry Lake Drive Suite 300 Baltimore MD 21209 United States Telephone: 410-602-0195 e-mail: mlerner@chespartners.com DANVI MANAGEMENT: Creditors' Proofs of Debt Due Aug. 15 ------------------------------------------------------- The creditors of Edanvi Management Inc. are required to file their proofs of debt by Aug. 15, 2016, to be included in the company's dividend distribution. The company commenced wind-up proceedings on July 6, 2016. The company's liquidator is: Morval Bank & Trust Cayman Ltd. Telephone: +1 (345) 949-9808 P.O. Box 30622 Grand Cayman KY1-1203 Cayman Islands FUTURE LTD: Creditors' Proofs of Debt Due Aug. 15 ------------------------------------------------- The creditors of The Future Ltd. are required to file their proofs of debt by Aug. 15, 2016, to be included in the company's dividend distribution. The company commenced wind-up proceedings on July 6, 2016. The company's liquidator is: Morval Bank & Trust Cayman Ltd. Telephone: +1 (345) 949-9808 P.O. Box 30622 Grand Cayman KY1-1203 Cayman Islands GOLDHORSE FUND: Placed Under Voluntary Wind-Up ---------------------------------------------- On July 24, 2016, the sole shareholder of Goldhorse Fund resolved to voluntarily wind up the company's operations. Creditors are required to file their proofs of debt to be included in the company's dividend distribution. The company's liquidator is: Kai Huang c/o David Lin Ogier 89 Nexus Way, Camana Bay Grand Cayman KY1-9009 Cayman Islands Telephone: +1 (345) 949 9876 Facsimile: +1 (345) 949-9877 KAZAR LIMITED: Commences Liquidation Proceedings ------------------------------------------------ At an extraordinary meeting held on June 24, 2016, the sole shareholder of Kazar Limited resolved to voluntarily liquidate the company's business. Creditors are required to file their proofs of debt to be included in the company's dividend distribution. The company's liquidator is: Nigel C. Bradley Telephone: +41 22 54 48 116 Rue de Candolle 17 1205 Geneva Switzerland MSN 2441: Commences Liquidation Proceedings ------------------------------------------- On July 1, 2016, the sole shareholder of MSN 2441 Leasing Limited resolved to voluntarily liquidate the company's business. Creditors are required to file their proofs of debt to be included in the company's dividend distribution. The company's liquidator is: Phang Thim Fatt 8 Shenton Way #18-01 Singapore 068811 SUPER MPAM: Creditors' Proofs of Debt Due July 30 ------------------------------------------------- The creditors of Super MPAM Cayman Fund Limited are required to file their proofs of debt by July 30, 2016, to be included in the company's dividend distribution. The company commenced liquidation proceedings on June 30, 2016. The company's liquidator is: Christopher Rowland c/o Richard Murphy Fund Fiduciary Partners Limited Harbour Centre, 2nd Floor 42 North Church Street George Town, Grand Cayman 10 Market Street, #769, Camana Bay Grand Cayman KY1-9006 Cayman Islands Telephone: +1 (345) 640 5863 e-mail: richard.Murphy@fundfidcuiaries.com TOPAZ PROPERTIES: Creditors' Proofs of Debt Due Aug. 10 ------------------------------------------------------- The creditors of Topaz Properties Limited are required to file their proofs of debt by Aug. 10, 2016, to be included in the company's dividend distribution. The company commenced liquidation proceedings on June 28, 2016. The company's liquidator is: Caroline Riou Wardour Management Services Limited P.O. Box 10147, Grand Cayman KY1-1002 Cayman Islands Telephone: (345) 945-3301 Facsimile: (345) 945-3302 VSK (CPO): Placed Under Voluntary Wind-Up ----------------------------------------- On July 5, 2016, the sole shareholder of VSK (CPO) Limited resolved to voluntarily wind up the company's operations. Creditors are required to file their proofs of debt to be included in the company's dividend distribution. The company's liquidator is: Darren Riley c/o Summit Management Limited Suite # 4-210 Governors Square 23 Lime Tree Bay Avenue P.O. Box 32311 Grand Cayman, KY1-1209 Cayman Islands WILLOW INVESTMENT: Creditors' Proofs of Debt Due Aug. 15 -------------------------------------------------------- The creditors of Willow Investment Company are required to file their proofs of debt by Aug. 15, 2016, to be included in the company's dividend distribution. The company commenced wind-up proceedings on July 6, 2016. The company's liquidator is: Morval Bank & Trust Cayman Ltd. Telephone: +1 (345) 949-9808 P.O. Box 30622 Grand Cayman KY1-1203 Cayman Islands =================================== D O M I N I C A N R E P U B L I C =================================== DOMINICAN REPUBLIC: Highlands Vegetable Growers Could Go Under -------------------------------------------------------------- Dominican Today reports that the agro producers grouped in the Unaproda said 63% of Constanza's small and medium vegetable growers is on the verge of bankruptcy and the remaining 37% will face serious problems in the coming days, "because the Dominican Agribusiness Board's (JAD) auctions to import products authorized by the Agriculture Ministry." It said the imports saturate the markets and keeps growers from selling their harvest, according to Dominican Today. Unaproda Secretary Alexis Suriel said the JAD held an auction to import garlic in May, "just when local farmers were harvesting the product, a situation that violates decree 569-12, which states that auctions cannot be made at harvest time," the report notes. "The auctions are done when production is scarce, but Dominican products should be auctioned first and then the imports. The decree is clear in that regard. If import any further quantity of a product is necessary, first check the internal deficit and from there, study the possibility of importing, respecting the seasonality of production for each crop," the report quoted Mr. Suriel as saying. Mr. Suriel said garlic has always been the target of attack from many quarters who wager against Constanza, which is the only area that grows it, and don't even know that it's the crop that sustains an economy with 100,000 inhabitants, the report notes. "Of the 667 hectares planted for the 2014-2015 harvest, only 220 were planted for the 2015-2016 harvest, representing 71.66% less," the report adds. As reported in the Troubled Company Reporter-Latin America on July 1, 2016, Moody's Investors Service has changed the outlook on the Dominican Republic's long term issuer and debt ratings to positive from stable. The ratings have been affirmed at B1. =========== M E X I C O =========== STATE OF CHIHUAHUA: Moody's Cuts Issuer Ratings to Ba3/Baa1.mx -------------------------------------------------------------- Moody's de Mexico downgraded the issuer ratings of the State of Chihuahua to Ba3 from Ba2 (Global Scale, local currency) and to Baa1.mx from A2.mx (Mexico National Scale). At the same time, Moody's downgraded to Baa2/Aa2.mx from Baa1/Aa1.mx the debt ratings of the following 8 enhanced loans and placed the ratings under review for further downgrade: -- MXN 4,500 million enhanced loan with Interacciones -- MXN 3,000 million enhanced loan with Multiva -- MXN 1,716 million enhanced loan with BBVA Bancomer -- MXN 1,380 million enhanced loan with BBVA Bancomer -- MXN 2,028 million enhanced loan with BBVA Bancomer -- MXN 1,995 million enhanced loan with Banorte -- MXN 10,000 million enhanced loan with Santander -- MXN 1,320 million enhanced loan with Banorte The review for further downgrade of the state's issuer ratings reflects refinancing risks of the state's short term debt resulting from heightened political risks given the current transition period. RATINGS RATIONALE The downgrade of the issuer ratings reflects a deterioration in the state's financial position during 2015. The state posted cash financing requirements of -9.7% of total revenues, which was higher than expected. This impacted Chihuahua's liquidity position and prompted an increase in net direct and indirect debt levels. The downgrade also takes into account Chihuahua's high unfunded pension liabilities. During the last five years, Chihuahua registered recurrent cash financing requirements equivalent to -8.2%, on average, of total revenues. During 2015, Chihuahua posted a sizable cash financing deficit equivalent to -9.7% of total revenues, higher than the - 4.6% of 2014. The cash financing requirements have resulted from a structural misalignment between revenue and expenditure growth, mainly reflecting current expenditures pressures related to education and public security. The state has financed part of its cash financing requirements with short-term lines of credit, long term debt and bond issuances backed by toll revenues. As such, Chihuahua's debt levels have increased during the past five years. The ratio of net direct and indirect debt to total revenues increased to 45.9% in 2015 from a 31.5% in 2011. Nonetheless, the state's debt service (both principal and interest) continues to be moderate, representing 2.9% of total revenues in 2015. Although net working capital (current assets minus current liabilities) at the end of 2015 was still positive, equivalent to 1.2% of total expenditures, it was lower than the 3.0% registered at the end of 2014. The ratings also incorporate the state's high unfunded pension liabilities, that represented 199% of total revenues according to the latest actuarial study, a level above the median of national peers. The ratings downgrade of the enhanced loans reflects the downgrade of Chihuahua's issuer ratings. While the loan enhancements continue to provide a four-notches uplift from the Global Scale issuer rating, per Moody's methodology on rating enhanced loans, the loan ratings are directly linked to the credit quality of the issuer, which ensures that underlying contract enforcement risks, economic risks and credit culture risks (for which the issuer rating acts as a proxy) are embedded in the ratings of the enhanced loans. RATIONALE TO PUT THE RATING UNDER REVIEW FOR FURTHER DOWNGRADE The review for further downgrade reflects Chihuahua's risks of paying the MXN 2.9 million short-term debt with Banco Interacciones and heightened political risks as a result of a change in administration. The current administration has the intention to refinance this obligation, extend its maturity, and secure it through toll revenues. The State Congress recently approved an additional MXN 6 billion debt to refinance Chihuahua's short term debt and to develop infrastructure projects. If this scenario materializes, refinancing risk would be mitigated. In case the loan is not refinanced, the loan is expected to be amortized in six monthly installments beginning in July. As the transfer of power changes between the old and new administration occurs, heightened political risks and recent events suggest some risk that this debt obligation may not be honored. Moody's said, "During the review period, Moody's will monitor the situation regarding the risks of the state's short term loan, when a new administration will enter office. In case the loan is not refinanced before that date, we will assess the willingness of the incoming administration to honor the state's financial obligations. Moody's plans to close the review within the next three months. WHAT COULD CHANGE THE RATING UP/DOWN "Given the review for further downgrade, an issuer rating upgrade is unlikely. Additionally, we note that the state's ratings could be further downgraded if refinancing risk materializes, or if we lack clarity about the incoming administration's intentions to honor it as default risk could increase." A downgrade of the ratings would also be likely if Chihuahua fails to implement measures for cutting expenditure, which could lead to higher than expected cash financing requirements, a further deterioration of its liquidity position or in higher debt levels. Moody's said, "Given the links between the loans and the credit quality of the obligor, a downgrade of the State of Chihuahua's issuer ratings or if debt service coverage levels fall materially below our expectations would likely result in a downgrade of the ratings on the loans. Conversely, an upgrade of Chihuahua's issuer ratings or if Debt Service Coverage of the loans increase substantially, ratings of the loans could be upgraded. ====================== P U E R T O R I C O ====================== INSTITUTO MEDICO: Patient Care Ombudsman Issues Monitoring Report ----------------------------------------------------------------- Dr. Francisco J. Parga Miranda, as sub-advocate of the Office of Puerto Rico's Patient Care Ombudsman, has issued a report to inform of the quality monitoring as of July 5, 2016. A copy of the report, only available in Spanish, can be downloaded at https://is.gd/GYG8zT About Instituto Medico Instituto Medico del Norte, Inc. -- aka Centro Medico Wilma N. Vazquez, aka Hospital Wilma N. Vazquez Skill Nursing Facility of Centro Medico Wilma N. Vazquez -- sought protection under Chapter 11 of the Bankruptcy Code on Oct. 30, 2013 (Bankr. D.P.R. Case No. 13-08961). The case is assigned to Judge Mildred Caban Flores. The Debtor scheduled $20,843,692 in total assets and $20,107,642 in total liabilities. The Debtor, however, said its real property has a book value of $16,000,000 and personal property is worth $6,105,979. The Debtor tapped as counsel Fausto David Godreau Zayas, Esq., and Rafael A. Gonzalez Valiente, Esq., at Latimer Biaggi Rachid & Godreau, in San Juan, Puerto Rico. Luis B. Gonzalez & Co. CPA's P.S.C. serves as accountant. The U.S. Trustee for the District of Puerto Rico has appointed Dr. Carlos Mellado (b/t Lcda Dinorah Collazo Ortiz) as patient care ombudsman. * * * MCS Advantage, Inc., MCS Life Insurance Company, Medical Card System, Inc., have filed a motion to convert the bankruptcy case to a liquidation under Chapter 7. MORGANS HOTEL: Amends Schedule 13E-3 Transaction Statement ---------------------------------------------------------- Morgans Hotel Group Co. filed with the Securities and Exchange Commission amendment no. 2 to the Company's Schedule 13E-3 to reflect the revisions in response to the SEC comment letter dated July 11, 2016. It is also being filed with the SEC pursuant to Section 13(e) of the Securities Exchange Act of 1934, as amended, jointly by (i) Morgans Hotel, (ii) Trousdale Acquisition Sub, Inc.("Merger Sub"), (iii) SBEEG Holdings, LLC and (iv) Yucaipa Hospitality Investments, LLC. The Transaction Statement relates to the Agreement and Plan of Merger, dated as of May 9, 2016, by and among the Company, SBE and Merger Sub. Pursuant to the Merger Agreement, if the conditions to the closing of the merger are either satisfied or waived, Merger Sub will be merged with and into the Company, the separate corporate existence of Merger Sub will cease and the Company will continue its corporate existence under Delaware law as the surviving corporation in the merger, as a direct or indirect wholly owned subsidiary of a new holding company to be established by SBE, in which Yucaipa, the members of SBE and certain other parties will be members ("Purchaser"). Upon completion of the merger, each share of the Company's common stock, par value $0.01 per share, other than shares owned by the Company and SBE and holders who have properly demanded and not withdrawn a demand for appraisal rights, will be converted into the right to receive $2.25 per share in cash, without interest and less any required withholding taxes. Following the completion of the merger, the Common Stock will no longer be publicly traded, and holders of the Common Stock that has been converted will cease to have any ownership interest in the Company. The Series A preferred securities of the company, par value $9.01 per share, will be exchanged for a combination of common and preferred equity interests in Purchaser and certain restaurants leasehold interests, as more fully described in the Proxy Statement. The holder of all of the Series A preferred securities has entered into a voting agreement with SBE, subject to the terms and conditions of which it has agreed to consent to the merger and the exchange of Series A preferred securities. Concurrently with the filing of this Transaction Statement, the Company is filing with the SEC a revised preliminary proxy statement under Regulation 14A of the Exchange Act, pursuant to which the Company's board of directors is soliciting proxies from stockholders of the Company in connection with the merger. A full-text copy of the amendment is available for free at: https://is.gd/nlWWX5 About Morgans Hotel Group Based in New York, Morgans Hotel Group Co. (Nasdaq: MHGC) -- http://www.morganshotelgroup.com/-- is widely credited as the creator of the first "boutique" hotel and a continuing leader of the hotel industry's boutique sector. Morgans Hotel Group operates and owns, or has an ownership interest in, Morgans, Royalton and Hudson in New York, Delano and Shore Club in South Beach, Mondrian in Los Angeles and South Beach, Clift in San Francisco, Ames in Boston, and Sanderson and St Martins Lane in London. Morgans Hotel Group and an equity partner also own the Hard Rock Hotel & Casino in Las Vegas and related assets. Morgans Hotel Group also manages hotels in Isla Verde, Puerto Rico and Playa del Carmen, Mexico. Morgans Hotel Group has other property transactions in various stages of completion, including projects in SoHo, New York and Palm Springs, California. Morgans Hotel reported net income attributable to common stockholders of $5.45 million on $220 million of total revenues for the year ended Dec. 31, 2015, compared to a net loss attributable to common stockholders of $66.6 million on $234 million of total revenues for the year ended Dec. 31, 2014. As of March 31, 2016, Morgans Hotel had $518 million in total assets, $737 million in total liabilities and a total deficit of $219 million. PUERTO RICO PUBLIC: S&P Lowers Rating on Series 2011A Bonds to D ---------------------------------------------------------------- S&P Global Ratings has lowered its rating on certain Puerto Rico Public Buildings Authority's bonds, as well as on the Puerto Rico Industrial, Tourist, Educational, Medical and Environmental Control Facilities Financing Authority's series 2011A bonds, to 'D' (default) from 'CC' following a default on payment of debt service on July 1, 2016. ================================ T R I N I D A D & T O B A G O ================================ TRINIDAD & TOBAGO: Biggest Problems are Corruption & Laundering --------------------------------------------------------------- Trinidad Express reports that Trinidad and Tobago's biggest problems are corruption and money laundering, Attorney General Faris Al-Rawi said. Mr. Al-Rawi said so huge is the problems that the country's national budget can be financed by money that leaks away through those illegal mechanisms, according to Trinidad Express. ================= V E N E Z U E L A ================= VENEZUELA: Bonds Propelled by Speculation PDVSA is Eyeing Swap -------------------------------------------------------------- Christine Jenkins and Nathan Crooks at Bloomberg News report that Venezuela's bonds are soaring on speculation the government may be looking to strike a deal to push back looming debt maturities, a move that would give the cash-strapped nation desperately needed breathing room. State-owned oil producer Petroleos de Venezuela SA has seen its $3 billion of bonds due in April jump 5.3 cents this week to 69 cents on the dollar, the highest September 2014, according to Bloomberg News. Investors are buying amid rumors that the company known as PDVSA is pursuing a swap that will allow it to reduce debt service in 2017, said Daniel Urdaneta, a strategist at Knossos Asset Management in Caracas, Bloomberg News notes. The struggling oil producer faces interest and principal payments of almost $7.5 billion next year. But to Nomura Holdings Inc.'s Siobhan Morden, bond investors may be getting ahead of themselves. "The catalyst was an investor call from an investment bank that appeared more like a reverse inquiry to solicit business than any firm mandate for an official exchange," Morden, the head of Latin America fixed-income strategy at Nomura, said in a report, Bloomberg News discloses. "There was nothing of substance to suggest any imminent launch of a formal offer, especially considering the delayed secondary buying," he added. PDVSA's finance department didn't immediately respond to a request for comment. Oil Minister and PDVSA President Eulogio Del Pino warned said that he had bad news for those waiting for the company to fail and that the next few days would bring important announcements from different parts of the industry, Bloomberg News relays. He also said PDVSA was working with drillers and service suppliers on a plan to convert commercial debt into financial debt, which would allow companies to continue operating in the country, according to a July 16 statement posted on PDVSA's website, Bloomberg News notes. The company's revenue from oil sales slumped 46 percent in 2015 to $55.3 billion as crude prices collapsed, fueling speculation the producer may not have the cash to stay current on its debt, Bloomberg News discloses. The company has interest payments totaling $212 million in August, with larger payments of $1.4 billion and $2.8 billion coming in October and November, respectively, according to data compiled by Bloomberg. Still, trading in credit-default swaps show that investors continue to reduce short-term default expectations, with the implied probability that it happens over the next 12 months falling to 51 percent from 60 percent just a month ago and 82 percent earlier this year, Bloomberg News says. The probability of a default in the next five years is 90 percent, according to credit-default swaps, Bloomberg News relays. The timing of a debt deal may be complicated by rising tensions between the opposition-controlled National Assembly and the Supreme Court that backs President Nicolas Maduro, which risks worsening a political crisis in a country already reeling from mounting economic turmoil, Bloomberg News notes. "An important implication for investors comes from the legal uncertainty associated with the validity of decisions of the legislative and judiciary from now on," Francisco Rodriguez, chief economist at Torino Capital in New York, said in a research note, Bloomberg News discloses. "The validity of future sovereign debt operations could thus be thrown into question if there is doubt about the authority of either the judiciary or the legislative to decide on these issues," he added. And while a deal could benefit PDVSA amid falling revenue and Venezuela's dwindling foreign reserves, the company would have to offer more attractive pricing to convince bondholders to accept a debt swap after the rally, which could make the deal expensive, Mr. Rodriguez said in an interview with Bloomberg News. The country's international reserves fell to a 13-year low of $11.9 billion on July 7, according to data compiled by Bloomberg. "It's a little late to do this," Mr. Rodriguez said, Bloomberg News notes. "Ideally the government should have considered this transaction in January or February, when the prices were favorable. Now, those bonds have risen in price and the problem is going to be expensive," he added. As reported in the Troubled Company Reporter-Latin America on July 5, 2016, Fitch Ratings affirmed Venezuela's Long-Term Foreign-and Local-Currency Issuer Default Ratings (LT FC/LC IDR) at 'CCC'. Fitch has also affirmed the sovereign's Short-Term Foreign Currency (ST FC) IDR at 'C' and country ceiling at 'CCC'. *********** 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 comillionercial 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 * * *