/raid1/www/Hosts/bankrupt/TCRLA_Public/170313.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
Monday, March 13, 2017, Vol. 18, No. 051
Headlines
A R G E N T I N A
GAINVEST CRECIMIENTO: Moody's Assigns B- Global Scale Bond Rating
B R A Z I L
ODEBRECHT SA: Probes Proliferate in Latin America
OI SA: Pharol's Rafael Mora Resigns From Board
PDG REALTY: Brazilian Court Grants Firm Bankruptcy Protection
PDG REALTY: Moody's Withdraws 'C' Corporate Family Ratings
SUZANO PAPEL: Fitch Rates Proposed Sr. Unsec. Notes 'BB+'
C A Y M A N I S L A N D S
ARDEN FOCUSED: Shareholder Receives Wind-Up Report
CALEDONIAN FUNDS: Shareholders Receive Wind-Up Report
CAPSTONE ASSET: Shareholders Receive Wind-Up Report
CARLYLE LIQUID: Shareholders Receive Wind-Up Report
CARLYLE LIQUID MASTER: Shareholders Receive Wind-Up Report
CARLYLE LIQUID OFFSHORE: Shareholders Receive Wind-Up Report
CARLYLE TREND: Shareholders Receive Wind-Up Report
CARLYLE TREND MASTER: Shareholders Receive Wind-Up Report
CATALYTIX LDC: Shareholders Receive Wind-Up Report
EDMOND INTERNATIONAL: Shareholders Receive Wind-Up Report
EXUMA OFFSHORE: Shareholder Receives Wind-Up Report
FOCUS 250: Shareholders Receive Wind-Up Report
GMB GLOBAL: Shareholders Receive Wind-Up Report
POMONA CAPITAL: Shareholders Receive Wind-Up Report
SHENWAN HONGYUAN: Shareholders Receive Wind-Up Report
SPECTRUM FIXED: Shareholders Receive Wind-Up Report
SPECTRUM WORLDWIDE: Shareholders Receive Wind-Up Report
WEISS MULTI-STRATEGY: Shareholders Receive Wind-Up Report
WILDHORN MASTER: Shareholders Receive Wind-Up Report
WILDHORN FUND: Shareholders Receive Wind-Up Report
WILDHORN GENERAL: Shareholders Receive Wind-Up Report
C H I L E
AUTOMOTORES GILDEMEISTER: Fitch Affirms 'CCC' Long-Term IDRs
LATAM AIRLINES: Fitch Affirms B+ LT Issuer Default Rating
M E X I C O
DESARROLLADORA HOMEX: Goldberg Law Probes Firm
GRUPO UNICOMER: Fitch Rates Proposed USD350MM Sr. Notes BB-
NEMAK SAB: S&P Assigns 'BB+' Rating on Proposed EUR500MM Notes
NEMAK SAB: Fitch Rates EUR500MM Senior Unsecured Notes BB+
NEMAK SAB: Moody's Rates Proposed EUR500MM Sr. Unsec. Notes Ba1
P A R A G U A Y
TELEFONICA CELULAR: Fitch Affirms BB+ Long-Term IDRs
P U E R T O R I C O
PR WIRELESS: Moody's Puts Caa1 CFR Under Review for Upgrade
T R I N I D A D & T O B A G O
DIGICEL GROUP: Denies Security Breach
X X X X X X X X X
* BOND PRICING: For the Week From March 6 to March 10, 2017
- - - - -
=================
A R G E N T I N A
=================
GAINVEST CRECIMIENTO: Moody's Assigns B- Global Scale Bond Rating
-----------------------------------------------------------------
Moody's Latin America Agente de Calificacion de Riesgo has
assigned bond fund ratings to Gainvest Crecimiento III FCI (the
Fund), a newly launched fund that is managed by Gainvest SASGFCI
in Argentina. The global scale and national scale ratings assigned
are:
- Global scale bond fund rating: B-bf
- National scale bond fund rating: A-bf.ar
RATINGS RATIONALE
"The fund ratings are based on Moody's expectations that Gainvest
Crecimiento III will invest approximately 30% of its assets in
local treasury bills (LEBACs) with high local credit quality of .
The remainder of the Fund's assets will be invested in highly
rated consumer ABS, corporates bonds and sub-sovereign bonds",
said Moody's lead analyst Carlos de Nevares. This Fund will seek
to provide returns close to Lebac's yield to the investors with a
duration of less than 1.5 years.
The rating agency noted that Gainvest Crecimiento III FCI has a
very short track record but is managed by an experienced asset
manager and uses Deutsche Bank S.A. (Argentina)(B1/Aa2.ar) as
custodian bank. The shareholders are institutional investors,
which have historically been clients of Gainvest.
The principal methodology used in this rating was Moody's Bond
Fund Rating Methodology published in May 2013.
Gainvest SASGFCI, is an independent medium sized asset manager in
the Argentinean mutual fund industry with a 3.45% market share. As
of February 2017, Gainvest, managed approximately AR$8,305.8
billion or USD 525 million.
===========
B R A Z I L
===========
ODEBRECHT SA: Probes Proliferate in Latin America
-------------------------------------------------
Ryan Dube, Luciana Magalhaes and Rogerio Jelmayer at The Wall
Street Journal report that investigations into Brazil's embattled
construction giant Odebrecht SA are exposing a larger network of
graft in Latin America than was already revealed in a massive
anticorruption settlement, according to prosecutors in several
countries.
Since the firm admitted in December to paying nearly $800 million
in bribes, authorities across Latin America have launched new
investigations that are beginning to ensnare former high-ranking
officials and other companies beyond Odebrecht SA, according to
The Wall Street Journal.
In Peru, a judge issued an arrest warrant for a former president
suspected of taking a kickback, the report notes. In Argentina, a
prosecutor opened a probe into alleged payments to the country's
intelligence chief, while Colombian authorities seized expensive
property of a former senator, the report relays. In Brazil,
former President Luiz Inacio Lula da Silva has been charged with
arranging loans from the country's development bank, BNDES, to
help Odebrecht win projects abroad in exchange for personal
benefits, the report notes. All have denied wrongdoing.
The report discloses that Brazilian prosecutors, who worked
closely with Swiss and U.S. officials in reaching the initial
settlement to resolve criminal charges, say they believe the
number of people investigated could more than double. In the
December deal, the largest ever of its kind, Odebrecht agreed to
pay between $2.6 billion to $4.5 billion in fines, the report
says. Separate claims from other countries could add to that, the
Brazilian prosecutors say. Odebrecht says it is cooperating with
prosecutors in other Latin American countries "to clarify acts
practiced by the company," the report notes.
"This [investigation] has the potential to spread, no doubt," said
Orlando Martello Junior, a Brazilian prosecutor, the report
relays.
Colombia's Attorney General Nestor Martinez said recently his
investigators found a web of bribery in the country extending
beyond the $11 million in corrupt payments Odebrecht acknowledged
in the settlement, the report relates. An official at state-run
Banco Agrario was indicted on a charge of allegedly falsifying
documents that helped an Odebrecht-controlled consortium secure
generous loan terms for a river-expansion project, the report
notes. The bank didn't respond to a request for comment, and the
official isn't expected to enter a plea until his first hearing on
March 15.
In Peru, Attorney General Pablo Sanchez said prosecutors have
launched over 30 investigations involving Odebrecht and other
Brazilian construction firms, the report discloses. Grana y
Montero, Peru's biggest builder and a frequent Odebrecht partner,
could also be investigated, an official said, the report notes.
That followed press reports citing claims from the former head of
Odebrecht in Peru that Grana y Montero knew bribes were paid in
connection to a joint project, the report relays.
The allegations, coupled with a sharp decline in the company's
share price, led to the resignations of its chairman, chief
executive and a director, the report notes. A class-action
lawsuit was filed in a New York court alleging that Grana y
Montero violated the Securities Exchange Act by making false or
misleading statements and failing to disclose it was aware of
Odebrecht's bribes, the report relays. Grana y Montero denies it
had knowledge of the illegal payments.
As new details emerge from countries across the region, investors
are selling off Odebrecht debt on fears the company will face
further legal action or be barred from doing business outside
Brazil, the report notes. The firm's 2025 bonds are trading at
39.9 cents on the dollar, down nearly 30% so far this year,
according to FactSet, the report notes.
"There are a lot of ongoing investigations in other countries and
[they] are likely to reach and damage the company even more," said
Paulo Petrassi, a partner in Brazilian investment firm Leme
Investimentos, the report discloses.
In January, the attorney general's office of Peru said prosecutors
signed a deal with Odebrecht to provide information on bribes, an
action whose consequences continue to ricochet through the
country's establishment, the report relays.
Former President Alejandro Toledo, who governed from 2001 to 2006,
denied charges that he took $20 million in bribes that prosecutors
say were wired to offshore accounts of businesses owned by a close
friend, the report says.
Last month, a court ordered the arrest of Mr. Toledo, whom
prosecutors are trying to extradite from the U.S., after
prosecutors laid out allegations that he secretly met with an
Odebrecht executive in 2004 in the presidential suite of the Hotel
Marriott in Rio de Janeiro, the report notes. There, prosecutors
say, the then-president and three associates allegedly worked out
a bribe in exchange for giving Odebrecht lucrative contracts to
build two stretches of a highway project, the report discloses.
He has denied the charge. Peru's comptroller general says the cost
of the entire project ballooned to about $4 billion from original
bids totaling $1 billion, the report says.
Another ex-president, Ollanta Humala, who governed until last
year, has denied accusations from a former Odebrecht director that
his wife took $3 million in cash from the firm for his campaign,
the report notes. His wife, Nadine Heredia, has said she didn't
receive the money.
Katherine Ampuero, an attorney appointed to represent the state of
Peru in the Odebrecht case, asked the attorney general's office to
open an investigation into yet another former president, Alan
Garcia, who was in power from 2006 to 2011, over corruption
allegations tied to Lima's subway project, the report relays. Mr.
Garc¡a has denied taking bribes.
Ms. Ampuero also asked prosecutors to open a preliminary
investigation into sitting President Pedro Pablo Kuczynski over
claims that Odebrecht made payments to a company with ties to him,
the report notes. Mr. Kuczynski has in the past denied
wrongdoing.
Mr. Kuczynski, who was Mr. Toledo's finance minister, said his
government would triple the budget allocated to anticorruption
prosecutors, create a system to protect and compensate
whistleblowers, and prohibit corrupt companies from transferring
funds abroad before paying fines, the report discloses.
"We need a radical change," said Mr. Kuczynski, whose approval
rating has fallen in recent months to a low of 29% on concerns
about corruption. "This crisis of confidence began in Brazil and
has now extended to all of Latin America's countries," he added.
In Mexico, Odebrecht has admitted paying $10.5 million in bribes,
according to the report.
Investigators there say they are looking not only at some $1.6
billion in contracts Odebrecht won from state-run oil giant
Petroleos Mexicanos, but also at 11 additional contracts Pemex
awarded to Odebrecht subsidiaries under different names, The Wall
Street Journal relays. The total amount of contracts under review
comes to more than $2 billion, according to people familiar with
the investigation, the report adds.
As reporter in the Troubled Company Reporter-Latin America on
Dec. 2, 2016, The Wall Street Journal related that Marcelo
Odebrecht, the jailed former head of Brazilian construction giant
Odebrecht SA, agreed to sign a plea-bargain agreement in
connection with Brazil's largest corruption probe ever, according
to a person close to the negotiations. The move could roil the
nation's political class yet again. The testimony of the former
industrialist, which is part of the deal, has the potential to
implicate numerous politicians who allegedly took kickbacks from
contractors as part of a years-long graft ring centered on
Brazil's state-run oil company, Petroleo Brasileiro SA, known as
Petrobras, according to The Wall Street Journal.
OI SA: Pharol's Rafael Mora Resigns From Board
----------------------------------------------
Ana Mano at Reuters reports that Pharol SGPS SA, the controlling
shareholder of Brazil's debt-laden telephone carrier Oi SA, said
in a statement that Rafael Mora had resigned as Pharol's executive
director and a member of Oi's board.
Joao do Passo Vicente Ribeiro, previously named as Mora's
alternate on the Oi board, will take his board seat, according to
a Pharol press representative, Reuters relates. The statement did
not give a reason for Mora's resignation.
Oi SA filed for Brazil's largest ever bankruptcy protection in
June 2016 to restructure about BRL65 billion ($20.8 billion) of
bank, bond and regulatory liabilities, the report notes.
* * *
As reported in the Troubled Company Reporter-Latin America on
Feb. 24, 2017, S&P Global Ratings affirmed its 'D' corporate
credit and issue-level global and national scale ratings on Oi
S.A. At the same time, S&P withdrew the recovery ratings on the
company's rated debt, until it has an updated capital structure
once Oi emerges from judicial reorganization.
PDG REALTY: Brazilian Court Grants Firm Bankruptcy Protection
-------------------------------------------------------------
Anthony Boadle at Reuters reports that a Sao Paulo court granted
Brazilian homebuilder PDG Realty SA bankruptcy protection on
Thursday, the company said in a securities filing.
PDG sought protection from creditors to enable it to restructure
its debt, Brazil's second publicly listed builder to do so in less
than six months, according to Reuters.
The report notes that PDG's gross debt was BRL5.4 billion (US$1.75
billion) at the end of September, according to a quarterly
earnings report. The company had BRL235 million of cash on hand
at the time, the report relays.
Weak demand, growing sales cancellations, stalled construction
projects and lawsuits from clients and contractors dogged PDG's
efforts to deal with its debt burden, the report adds.
As reported in the Troubled Company Reporter-Latin America on
Feb. 7, 2017, Moody's America Latina has downgraded the corporate
family ratings (CFR) assigned to PDG Realty S.A. Empreendimentos e
Participacoes (PDG) to C from Caa3 on the global scale and to C.br
from Caa3.br on the Brazilian national scale. At the same time,
Moody's downgraded the ratings of the company's BRL250 million
senior secured bank credit notes due in 2020 to C/C.br from
Caa3/Caa3.br, and the rating of the company's BRL140 million
senior unsecured debentures due in 2018 to C/C.br from Ca/Ca.br.
PDG REALTY: Moody's Withdraws 'C' Corporate Family Ratings
----------------------------------------------------------
Moody's America Latina Ltda. has withdrawn all of PDG Realty S.A
Empreendimentos e Participacoes ratings following the company's
announcement on Feb. 22, 2017 that it filed for bankruptcy
protection under the Brazilian law 11.101/05 (recovery and
bankruptcy law) which was approved by the Brazilian court on
March 2, 2017.
Ratings withdrawn:
Issuer: PDG Realty S.A. Empreendimentos e Participacoes
-- Corporate Family Ratings: C (global scale) and C.br
(national scale)
-- BRL250 million senior secured bank credit notes (CCBs-15th
series- 1st issuance) due in 2020: C/C.br
-- BRL140 million senior unsecured debentures due in 2018
(7th issuance): C/C.br
RATINGS RATIONALE
The ratings withdrawal follows PDG's filing on February 22, 2017
for bankruptcy protection to enable it to restructure its debt.
The judicial recovery request was approved on March 2nd, 2017 by
the Brazilian court and includes 512 companies within the PDG
group. The request needs to be ratified by shareholders on an
extraordinary shareholders' meeting scheduled for March 27, 2017.
The bankruptcy filing was triggered by an increasing number of
creditors executing judicial claims associated to delinquent loans
following a prolonged period of financial distress and weak
industry fundamentals. At the end of September 2016, PDG reported
BRL 5.4 billion in total debt, including both corporate and
project-related loans. In addition to its financial debt, PDG also
has liabilities with clients, suppliers and employees, among
others.
PDG had several events of default over the last couple of years
and continues to work on its debt restructuring plan initiated in
August 2015. PDG's financial distress results from weak operating
performance, untenable capital structure and limited financial
flexibility to meet its near term debt service and working capital
requirements. The general slowdown in the homebuilding industry in
Brazil that was aggravated by the economic downturn, created
further challenges to the company's liquidity, as it reduced
funding availability for home acquisition, increased sales
cancellations and delayed the credit takeout process after project
completions.
Moody's has last downgraded PDG on February 3, 2017, when the
company missed the payment of an extraordinary early amortization
on its BRL250 million senior secured bank note (CCB) that is
underlying the 15th series of the 1st issuance of real estate
certificates (CRI). According to the instruments' indentures, the
missed payment could trigger the acceleration of both the CCB and
the CRI.
PDG Realty S.A. Empreendimentos e Participacoes (PDG) is a
Brazilian homebuilder operating through its wholly owned
subsidiaries, Goldfarb, CHL, Agre and minority investments in
other companies. In the last twelve months ended September 2016,
PDG generated net revenues of BRL306 million (USD84 million) and
net losses of BRL4.8 billion (USD1.3 billion).
SUZANO PAPEL: Fitch Rates Proposed Sr. Unsec. Notes 'BB+'
---------------------------------------------------------
Fitch Ratings has assigned a 'BB+(EXP)' rating to the proposed
senior unsecured notes to be issued by Suzano Austria GmbH, and
guaranteed by Suzano Papel e Celulose S.A. (Suzano). Proceeds from
these unsecured notes, which are expected to total a minimum of
USD300 million, with a tenor of up to 30 years, will be used to
extend the company's debt maturity profile. Fitch currently rates
Suzano's Foreign Currency and Local Currency Issuer Default
Ratings (IDR) 'BB+' with a Positive Outlook.
The rating reflects Suzano's stronger free cash flow (FCF) due to
the depreciation of the Brazilian real, which has reduced the
company's cost structure over the past two years and allowed
Suzano to deleverage to an adjusted net debt / adjusted EBITDA
ratio of 3x at the end of December 2016. Suzano's ratings continue
to reflect the company's leading position in printing and writing
paper and paperboard in Brazil, and its position as the fifth
largest producer of market pulp in the world. The ratings also
incorporate Suzano's strong liquidity and comfortable debt
amortization schedule.
The Positive Outlook for the corporate ratings reflects Fitch's
expectation that Suzano's FCF will remain strong in 2017 and net
adjusted leverage will decline to below 2x by 2018. An upgrade
could occur if the company uses its FCF to reduce gross debt by
around BRL2 billion. The Positive Outlook also reflects the
expectation that the company's strategy to decrease leverage and
improve its capital structure will remain unchanged.
KEY RATING DRIVERS
Solid Business Position
Suzano is the leading producer of printing and writing paper in
Brazil, as well as paperboard, with 1.3 million tons of annual
production capacity. The company's strong market shares in
uncoated printing and writing paper and in paperboard allow it to
be a price leader in Brazil. With 3.5 million tons of market pulp
capacity, Suzano is the fifth largest producer of market pulp in
the world. Like other producers of hardwood pulp in Brazil, Suzano
enjoys a production cost structure that is among the lowest in the
world. This enables Suzano to generate positive cash flows during
troughs in the pulp and paper cycle, ensuring its long-term
competitiveness.
Leverage Will Continue to Decline
Stronger cash flow has accelerated the deleveraging of Suzano's
balance sheet over the past two years at a pace more rapid than
originally projected. Suzano's adjusted net debt /adjusted EBITDA
ratio in 2016 was 3x and should fall to below 2x by 2018. Net
adjusted leverage was 3x at year-end 2015 and 4.4x in 2014.
Historically, Suzano has operated with higher leverage within its
Latin America peer group, with an average net adjusted leverage
ratio of 3.6x between 2008 and 2011, and 5.1x between 2012 and
2014.
Fitch's base case uses low-cycle price assumption of net pulp
prices of between USD550 and USD575 per ton during the next three
years. Capex in 2017 is assumed at around BRL1.8 billion.
Operational Cash Flow to Remain Strong in 2017
Fitch projects that Suzano will generate about BRL5 billion of
adjusted EBITDA and BRL3.5 billion of cash flow from operations
(CFFO) in 2017. Suzano's adjusted EBITDA generation benefited from
the depreciation of the Brazilian real against the U.S. dollar,
which has reduced the company's cost structure and bolstered
export revenues, offsetting weaker domestic demand for paper.
Suzano generated BRL3.7 billion of adjusted EBITDA and BRL3
billion of CFFO in 2016. This compares with BRL4.5 billion of
adjusted EBITDA and BRL2.6 billion of CFFO during 2015, and BRL2.4
billion and BRL1.5 billion in 2014. As Suzano scales back
investments, FCF was BRL390 million in 2016.
Stronger operating cash flow and lower investments will contribute
toward the company's debt reduction strategy. Suzano had BRL11
billion of net debt as of Dec. 31, 2016 and Fitch projects Suzano
will lower its net debt by BRL1 billion to BRL10 billion by the
end of 2018. As of Dec. 31, 2016, the company had BRL14.7 billion
of total debt.
Forestry Assets Are Key Credit Consideration
A key credit consideration that further enhances Suzano's credit
profile is its ownership of about 1.2 million hectares of land,
where the company developed about 534,000 hectares of eucalyptus
plantations. The forestry assets are valued at BRL4.2 billion.
Importantly, the nearly ideal conditions for growing trees in the
region make these plantations extremely efficient by global
standards and give the company a sustainable advantage in terms of
cost of fiber and transportation costs between forest and mills.
Pulp Price Close to Marginal Cost
Continued expansion activity in the market will make producers
reliant upon growth in Chinese demand, plant closures, and a
recovery in the U.S. and Europe for upward price momentum. Fitch
believes market pulp is already close to marginal cost and will
continue to force plant closures of high-cost producers in the
Northern Hemisphere. Fitch expects more than 5 million tons of
hardwood pulp capacity to enter the market during 2016 and 2017,
while annual demand growth for market pulp should not exceed 1.5
million tons per year. China continues to play a key role in
balancing supply and demand and a return of Chinese demand growth
to 1.5 million tons per year is crucial to balancing the market.
KEY ASSUMPTIONS
Fitch's key assumptions within the rating case for Suzano include:
-- Net pulp prices between USD550 and USD575 per ton during
2016-2018.
-- Pulp sales volume around 3.6 million tons per year during
2016-2018, and paper at full capacity.
-- Adjusted EBITDA margin around 44.5%.
-- A Brazilian real averaged 3.75 BRL/USD in 2017.
RATING SENSITIVITIES
Future developments that may individually or collectively lead to
a positive rating action includes:
-- Reduction in gross debt by around BRL2 billion.
-- Maintenance of net adjusted leverage below 2x during a low
investment cycle.
-- Higher than expected cash generation during 2016 and 2017.
-- Additional proactive steps by the company to materially
bolster its capital structure in the absence of high operating
cash flow.
-- A positive outlook for pulp prices in the next couple of
years could also bolster the probability of positive rating
actions.
Future developments that may individually or collectively lead to
a negative rating action include:
-- Weaker liquidity position.
-- Increase in net adjusted leverage ratio to levels above 4x,
considering pulp prices at USD550 per ton.
-- Sharp deterioration of market conditions with significant
reduction of pulp prices.
-- A debt-financed acquisition.
-- Any change in the company's strategy to reduce leverage
and improve capital structure.
LIQUIDITY
Suzano has historically maintained a strong cash position. As of
Dec. 31, 2016, the company had BRL3.7 billion of cash and
marketable securities. Liquidity covered short-term debt
obligations by a multiple of 2.1x. Suzano has manageable debt
maturities of BRL1.7 billion in the short term, and BRL2.5 billion
in 2018. Suzano does not have a standby facility. In April 2016,
Suzano concluded the issuance of Export Credit Notes, in the
amount of BRL600 million. The transaction is securitized by
Agribusiness Credit Receivables Certificates (CRA) and is due in
April 2020.
FULL LIST OF RATING ACTIONS
Fitch assigns the following rating:
Suzano Austria GmbH
-- Proposed senior unsecured notes, minimum of USD300 million
and up to 30 years, 'BB+(EXP)'.
Transaction will be issued by Suzano Austria GmbH and guaranteed
by Suzano.
Fitch currently rates Suzano:
Suzano
-- Long-Term Foreign Currency IDR 'BB+';
-- Long-Term Local Currency IDR 'BB+';
-- National long-term rating 'AA+(bra)'.
Suzano Austria GmbH
-- USD500 million senior unsecured notes, due July 14 2026
and guaranteed by Suzano 'BB+'.
Suzano Trading Ltd.
-- USD650 million senior notes, due Jan. 23, 2021 and guaranteed
by Suzano 'BB+'.
The Rating Outlook for the corporate ratings is Positive.
==========================
C A Y M A N I S L A N D S
==========================
ARDEN FOCUSED: Shareholder Receives Wind-Up Report
--------------------------------------------------
The shareholder of Arden Focused Global Macro Fund, Ltd. received
on Jan. 27, 2017, the liquidator's report on the company's wind-up
proceedings and property disposal.
The company's liquidator is:
Elian Fiduciary Services (Cayman) Limited
c/o Jody Powery-Gilbert
Telephone: +1 (345) 949 9876
Facsimile: +1 (345) 949 9877
CALEDONIAN FUNDS: Shareholders Receive Wind-Up Report
-----------------------------------------------------
The shareholders of Caledonian Funds, SPC received on Jan. 26,
2017, the liquidator's report on the company's wind-up proceedings
and property disposal.
The company's liquidator is:
Ms. Claire Loebell
c/o Deri Hill
Telephone: (345) 814 8958
Facsimile: (345) 814 8529
Ernst & Young Ltd.
62 Forum Lane Camana Bay
P.O. Box 510 Grand Cayman KY1-1106
Cayman Islands
CAPSTONE ASSET: Shareholders Receive Wind-Up Report
---------------------------------------------------
The shareholders of Capstone Asset Management Limited received on
Jan. 25, 2017, the liquidator's report on the company's wind-up
proceedings and property disposal.
The company's liquidator is:
Richard Fear
c/o Kevin Butler
P.O. Box 2681 Grand Cayman KY1-1111
Cayman Islands
Telephone: (345) 814 7374
Facsimile: (345) 945 3902
CARLYLE LIQUID: Shareholders Receive Wind-Up Report
---------------------------------------------------
The shareholders of Carlyle Liquid Tactical General Partner
received on Jan. 27, 2017, the liquidator's report on the
company's wind-up proceedings and property disposal.
The company's liquidator is:
David Griffin
FTI Consulting (Cayman) Ltd.
Suite 3212, 53 Market Street
Camana Bay
P.O. Box 30613 Grand Cayman KY1 - 1203
Cayman Islands
CARLYLE LIQUID MASTER: Shareholders Receive Wind-Up Report
----------------------------------------------------------
The shareholders of Carlyle Liquid Tactical Master Fund, L.P.
received on Jan. 27, 2017, the liquidator's report on the
company's wind-up proceedings and property disposal.
The company's liquidator is:
David Griffin
FTI Consulting (Cayman) Ltd.
Suite 3212, 53 Market Street
Camana Bay
P.O. Box 30613 Grand Cayman KY1 - 1203
Cayman Islands
CARLYLE LIQUID OFFSHORE: Shareholders Receive Wind-Up Report
------------------------------------------------------------
The shareholders of Carlyle Liquid Tactical Offshore Feeder Fund
received on Jan. 27, 2017, the liquidator's report on the
company's wind-up proceedings and property disposal.
The company's liquidator is:
David Griffin
FTI Consulting (Cayman) Ltd.
Suite 3212, 53 Market Street
Camana Bay
P.O. Box 30613 Grand Cayman KY1 - 1203
Cayman Islands
CARLYLE TREND: Shareholders Receive Wind-Up Report
--------------------------------------------------
The shareholders of Carlyle Trend Following Feeder Fund received
on Jan. 27, 2017, the liquidator's report on the company's wind-up
proceedings and property disposal.
The company's liquidator is:
David Griffin
FTI Consulting (Cayman) Ltd.
Suite 3212, 53 Market Street
Camana Bay
P.O. Box 30613 Grand Cayman KY1 - 1203
Cayman Islands
CARLYLE TREND MASTER: Shareholders Receive Wind-Up Report
---------------------------------------------------------
The shareholders of Carlyle Trend Following Master Fund received
on Jan. 28, 2017, the liquidator's report on the company's wind-up
proceedings and property disposal.
The company's liquidator is:
David Griffin
FTI Consulting (Cayman) Ltd.
Suite 3212, 53 Market Street
Camana Bay
P.O. Box 30613 Grand Cayman KY1 - 1203
Cayman Islands
CATALYTIX LDC: Shareholders Receive Wind-Up Report
--------------------------------------------------
The shareholders of Catalytix LDC received on Jan. 24, 2017, the
liquidator's report on the company's wind-up proceedings and
property disposal.
The company's liquidator is:
Russell Homer
c/o Tanya Armstrong
P.O. Box 2499, Grand Cayman KY1-1104
Cayman Islands
Telephone: (345) 946-0836
Facsimile: (345) 946-0864
EDMOND INTERNATIONAL: Shareholders Receive Wind-Up Report
---------------------------------------------------------
The shareholders of Edmond International Limited received on
Jan. 31, 2017, the liquidator's report on the company's wind-up
proceedings and property disposal.
The company's liquidator is:
Peter Hart
c/o Jack McGinley
1 Westferry Circus
Canary Wharf
E14 4HD
London
Telephone: 020 7516 2297
e-mail: jack.mcginley@geoffreymartin.co.uk
EXUMA OFFSHORE: Shareholder Receives Wind-Up Report
---------------------------------------------------
The shareholder of Exuma Offshore Fund Ltd received on Jan. 26,
2017, the liquidator's report on the company's wind-up proceedings
and property disposal.
The company's liquidator is:
Coatue Management, L.L.C.
c/o Sophia Leavett
Telephone: +1 (345) 949 9876
Facsimile: +1 (345) 949 9877
FOCUS 250: Shareholders Receive Wind-Up Report
----------------------------------------------
The shareholders of Focus 250 Ltd. received on Jan. 25, 2017, the
liquidator's report on the company's wind-up proceedings and
property disposal.
The company's liquidator is:
Richard Fear
c/o Kevin Butler
P.O. Box 2681 Grand Cayman KY1-1111
Cayman Islands
Telephone: (345) 814 7374
Facsimile: (345) 945 3902
GMB GLOBAL: Shareholders Receive Wind-Up Report
-----------------------------------------------
The shareholders of GMB Global Multi-Strategy Offshore, Ltd.
received on Jan. 26, 2017, the liquidator's report on the
company's wind-up proceedings and property disposal.
Michael Buenzow is the company's liquidator.
POMONA CAPITAL: Shareholders Receive Wind-Up Report
---------------------------------------------------
The shareholders of The Pomona Capital Fund III received on
Jan. 24, 2017, the liquidator's report on the company's wind-up
proceedings and property disposal.
The company's liquidator is:
Russell Homer
c/o Tanya Armstrong
P.O. Box 2499, Grand Cayman KY1-1104
Cayman Islands
Telephone: (345) 946-0836
Facsimile: (345) 946-0864
SHENWAN HONGYUAN: Shareholders Receive Wind-Up Report
-----------------------------------------------------
The shareholders of Shenwan Hongyuan Asia Fund Management Limited
received on Jan. 30, 2017, the liquidator's report on the
company's wind-up proceedings and property disposal.
The company's liquidator is:
DMS Corporate Services Ltd.
c/o Norman Chan
dms House 20 Genesis Close
P.O. Box 1344 George Town KY1-1108
Cayman Islands
Telephone: (345) 946 7665
Facsimile: (345) 949 2877
SPECTRUM FIXED: Shareholders Receive Wind-Up Report
---------------------------------------------------
The shareholders of Spectrum Fixed Income Fund received on
Jan. 30, 2017, the liquidator's report on the company's wind-up
proceedings and property disposal.
The company's liquidator is:
Mr. Christos Kongorozis
c/o Yury Anikin
4 Annis Komninis Street
Solea Building, flat 801
1060 Nicosia
Cyprus
SPECTRUM WORLDWIDE: Shareholders Receive Wind-Up Report
-------------------------------------------------------
The shareholders of Spectrum Worldwide Investments Ltd. received
on Jan. 30, 2017, the liquidator's report on the company's wind-up
proceedings and property disposal.
The company's liquidator is:
Ms. Elena Sizova
c/o Yury Anikin
Yiannoy Kranidioti 5, 2
Koyklia, 8510
Paphos, Cyprus
WEISS MULTI-STRATEGY: Shareholders Receive Wind-Up Report
---------------------------------------------------------
The shareholders of Weiss Multi-Strategy Partners II (Cayman) Ltd.
received on Jan. 30, 2017, the liquidator's report on the
company's wind-up proceedings and property disposal.
The company's liquidator is:
DMS Corporate Services Ltd.
c/o Norman Chan
P.O. Box 1344 George Town KY1-1108
dms House 20 Genesis Close
Cayman Islands
Telephone: (345) 946 7665
Facsimile: (345) 949 2877
WILDHORN MASTER: Shareholders Receive Wind-Up Report
----------------------------------------------------
The shareholders of The Wildhorn Master Fund received on Jan. 26,
2017, the liquidator's report on the company's wind-up proceedings
and property disposal.
The company's liquidator is:
Ewan Christian
29 Queen Anne's Gate
London SW1H 9BU
UK
Telephone: +442073402825
Facsimile: +448707108448
WILDHORN FUND: Shareholders Receive Wind-Up Report
--------------------------------------------------
The shareholders of The Wildhorn Fund received on Jan. 26, 2017,
the liquidator's report on the company's wind-up proceedings and
property disposal.
The company's liquidator is:
Ewan Christian
29 Queen Anne's Gate
London SW1H 9BU
UK
Telephone: +442073402825
Facsimile: +448707108448
WILDHORN GENERAL: Shareholders Receive Wind-Up Report
-----------------------------------------------------
The shareholders of Wildhorn General Partner Limited received on
Jan. 26, 2017, the liquidator's report on the company's wind-up
proceedings and property disposal.
The company's liquidator is:
Ewan Christian
29 Queen Anne's Gate
London SW1H 9BU
UK
Telephone: (+442)073-402825
Facsimile: (+448)707-108448
=========
C H I L E
=========
AUTOMOTORES GILDEMEISTER: Fitch Affirms 'CCC' Long-Term IDRs
------------------------------------------------------------
Fitch Ratings has affirmed Automotores Gildemeister S.p.A.'s Long-
Term Foreign and Local Currency Issuer Default Ratings (IDRs) at
'CCC.' The senior secured notes are affirmed at 'CCC-/RR4'. AG's
secured notes rating of 'CCC-/RR4' reflects the weaker position in
the capital structure of this security relative to the company's
secured bank loans.
KEY RATING DRIVERS
High Credit Risk: AG's 'CCC' rating reflects the need for the
company to increase profitability and execute asset sales to
improve leverage and financial flexibility. The ratings consider
the expectation of improvement in the business environment in
Chile and Peru, with single-digit volume growth expected in both
markets in 2017. The company has been reducing SG&A and market
costs. AG increased revenues by 4.2% year-on-year at USD1.17
billion and EBITDA (including dividends received) reached
USD37million in fiscal year end 2016 (FYE16). Fitch projects an
EBITDA of about USD66 million in 2016.
Capital Structure: On Feb. 24, 2016, AG completed a debt exchange
offer that reduced the amount of gross debt by one-third and
changed the debt structure from unsecured to secured debt. Total
debt was USD576 million as of FYE16 compared to USD898 million in
FYE15. The senior secure notes mature on May 23, 2021 with no
scheduled amortization. The notes are secured by first priority
liens on real estate properties with a value of USD180 million.
The transaction considered the conversion of USD273 million of
debt into new preferred stock. No dividends will be payable on the
new preferred stock.
Potential 2017-2018 Recovery: Fitch believes the company's
capacity to improve debt services depends on the recovery of
vehicle sales in Chilean and Peruvian markets. Assuming a recovery
occurs in these markets in 2017-2018, AG could improve cash flow
generation and reach interest coverage above 1.5x towards 2018,
the first year when the company will cover the full annual amount
of interest expenses on its bond after two years of capitalizing
interest on the senior secured notes; the secured notes permitted
the company to capitalize interest for the first two years.
Improved Leverage: Fitch expects net debt/EBITDA to decrease to
about 8.0x in 2017 from 14.5x in FYE16. Fitch expects AG to
improve net leverage thanks to positive free cash flow (FCF)
generation as a result of improved EBITDA and lower interest
expenses. Also, the company is selling non-core assets to reduce
leverage. AG sold about USD62 million of assets (real estate,
equipment, and businesses) in 2016. Fitch expects AG to pay around
USD12 million of cash interest in 2017 and then around USD43
million in 2017 when AG resumes paying interest on its senior
secured notes.
KEY ASSUMPTIONS
Future developments that may, individually or collectively, lead
to a negative rating action include:
-- Single-digit revenue growth in 2017;
-- The company's EBITDA reaches USD66 million in 2017;
-- The company executes the option of no cash interest payments
in 2017;
-- Minimum capex level around USD5 to USD6 million per year and
no dividend payments during 2017-2018.
RATING SENSITIVITIES
Future developments that may, individually or collectively, lead
to a negative rating action include:
-- Weak operational results with vehicle sales declining,
limiting the recovery of AG's cash flow generation approaching
2018;
-- Expectations of AG's interest coverage ratio, measured as
total EBITDA to Interest Expenses ratio, substantially below
1x approaching 2018;
-- Consistent negative FCF generation.
Conversely, Fitch may take a positive rating action if a
combination of the following factors takes place:
-- Strong liquidity;
-- Strengthening of the company's interest coverage ratio
approaching 2018;
-- Capacity to maintain consistently neutral-to-positive
FCF generation.
LIQUIDITY
Liquidity is viewed as manageable. AG ended FYE16 with a cash
position of around USD24 million and short-term debt of USD67
million. The company has USD60.8 million of restricted cash.
Liquidity relies on the company's capacity to renew short-term
debt with banks as a secured bond matures in 2021. In 2017, Fitch
expects the company to generate positive FCF thanks to increased
EBITDA, low capex and interest expense despite negative working
capital inflow as the company is selling more vehicles. AG
reported USD97 million of assets held for sale as of FYE16. Fitch
expects most of the divestments to be implemented over the next
two years and cash proceeds to be used for working capital and
debt proceeds.
FULL LIST OF RATING ACTIONS
Fitch affirms the following ratings:
Automotores Gildemeister S.p.A
-- Long-Term Foreign and Local Currency IDRs at 'CCC';
-- Senior secured notes at 'CCC-/RR4'.
LATAM AIRLINES: Fitch Affirms B+ LT Issuer Default Rating
---------------------------------------------------------
Fitch Ratings has affirmed LATAM Airlines Group S.A.'s (LATAM)
long-term foreign currency Issuer Default Rating (IDR) at 'B+'. In
addition, Fitch has affirmed TAM S.A.'s (TAM) foreign and local
currency IDRs at 'B+' and its national long-term rating at 'A-
(bra)'. Fitch has also affirmed LATAM and TAM's unsecured notes at
'B+/RR4'. The Rating Outlook for the corporate ratings has been
revised to Stable from Negative. A full list of rating actions
follows at the end of this release.
The rating affirmations and Outlook revision to Stable reflect
expectations that improvement in the company's credit metrics will
continue during 2017. LATAM's operational EBIT margin is expected
to be around 6% in 2016, an improvement over a 5.1% in 2015.
During 2016 the company reached improvement in liquidity and
significant reduction in fleet commitments. During 2017, the
company's EBIT margin is likely to reach 6.5%, adjusted gross
leverage 5.5x, and liquidity (measured as cash and unused
committed credit lines/latest 12 months (LTM) revenues ratio)
should remain near 18%.
LATAM's ratings are supported by its diversified business model,
important regional market position, and adequate liquidity. These
positive factors are tempered by the company's still high gross
adjusted leverage and operational volatility related to some key
markets.
KEY RATING DRIVERS
Moderate Traffic Growth
Fitch expects the company's consolidated boarded passengers to
reach an annual growth rate in the 3% to 4% range during 2017.
This view incorporates the expectation that traffic trends for the
Spanish Speaking Countries (SSC) and International segments will
continue performing well, while traffic levels for the Brazilian
segment will stabilize in 2017. Declining yields have been one of
the key factors affecting LATAM's total revenues and operational
margin during 2015-2016. Fitch expects the company's average
passenger yields to remain relative stable during 2017 driven by a
better operating environment, particularly in the Brazilian
segment.
EBIT Margin Projected at 6.5%
LATAM plans capacity increases in 2017 of 0%-2% in the
international segment and 4%-6% in the SSC segment, along with a
planned capacity decrease at -2%-0% in the Brazilian domestic
segment. The cargo segment should see a contraction in the range
of -10%/-12%. Under its base case, Fitch expects LATAM's 2017
total revenues to be approximately USD10.1 billion, representing a
6% increase over 2016, compensating for some increase in fuel cost
and resulting in an EBIT margin of 6.5% in 2017.
Better Fundamentals in the Brazilian Market
Expected trends in traffic and passenger yields should result in
better operational margins for the Brazilian market in 2017.
Industry capacity reductions, executed through 2016, should drive
a recovery in passenger yields while the improvement in Brazil's
macroeconomic conditions is anticipated to drive moderate traffic
growth in 2017. Fitch forecasts Brazil's GDP growth to be 0.7% in
2017, an improvement from the contraction of 3.5% in 2016.
Slow Deleveraging
Fitch expects LATAM's gross adjusted leverage to have reached 6x
in December 2016, a moderate improvement from 6.5x in 2015.
Fitch's base case envisions the company's gross leverage trending
to 5.5x by year-end 2017. LATAM's adjusted gross leverage,
measured as total adjusted debt/EBITDAR, was 6.4x at Sept. 30,
2016. The company's total adjusted debt was $12.9 billion at Sept.
30, 2016. This debt includes $9 billion of on-balance-sheet debt
and $3.9 billion of off-balance-sheet obligations related to
operating leases with combined rental payments of approximately
$554 million in the last 12-month period ended Sept. 30, 2016 (LTM
September 2016).
Positive FCF in 2017
Fitch views the company's capex reduction, executed during 2016,
as positive for its FCF generation. The company's total capex,
including fleet and non-fleet capex after PDP payments/refunds,
was USD1.6 billion in 2015, and it is expected to be USD694
million in 2016. LATAM maintains a total capex plan that calls for
capex levels of USD487 million and USD982 million during 2017 and
2018, respectively, which represents a material reduction when
compared with the company's historical capex levels. Fitch expects
LATAM's FCF margin to be positive during 2017-2018 driven by
revenue growth, continued EBIT margin improvement, and low capex
levels relative to historical 2014-2015 levels. The company's 2017
FCF generation is estimated in the USD500 million to USD700
million range, representing a 5% to 7% FCF margin, respectively.
Fitch's base case assumes the company's gross on-balance-sheet
debt will decline to about USD8 billion by year-end 2017.
Strong Credit Linkage
LATAM maintains indirectly substantially all of the economic
rights and 49% of the voting rights in TAM, which is an affiliate
company of LATAM. The ratings of LATAM and TAM also incorporate
the strong credit linkage between both entities with significant
legal, operational and strategic ties existing between the two
companies. In addition, the financing of the combined fleet plan
capex is primarily implemented through LATAM, with the new
aircraft being subleased to TAM. Furthermore, the view of strong
legal ties existing between LATAM and TAM is supported by cross
default clauses incorporated in LATAM's USD500 million unsecured
notes due in 2020.
KEY ASSUMPTIONS
Fitch's key assumptions within the rating case for LATAM include:
-- 2017 net revenues to increase 6%;
-- 2017 EBIT margin 6.5%;
-- 2017 gross adjusted leverage, measured as total adjusted
debt to EBITDAR, of 5.5x;
-- 2017 Coverage ratio, EBITDAR/(Net Interest Expense plus
Rents), 2.4x;
-- 2017 Liquidity (measured as readily available cash plus unused
committed credit facilities over LTM net revenues), 18%;
-- 2017 FCF generation positive in the USD500 million to USD700
million range.
RATING SENSITIVITIES
Positive Rating Action:
Considerations that could lead to a positive rating action (rating
or Outlook) include liquidity, measured as cash/LTM revenues,
consistently above 15%; gross adjusted leverage consistently
approximately 4.5x; neutral-to-positive FCF generation; coverage
ratio, measured as the total EBITDAR/(Net Interest Expense plus
Rents) consistently above 2.5x; and EBIT margin moving to 8%.
Negative Rating Actions:
Considerations that could lead to a negative rating action (rating
or Outlook) include sustained negative FCF; liquidity, measured as
cash/LTM revenues, consistently below 10%; gross adjusted leverage
consistently above 5.5x; EBIT margin consistently below 6.5%; and
coverage ratio, measured as total EBITDAR/(interest expense plus
rents), consistently below 2.25x.
LIQUIDITY
Adequate Liquidity, Cash plus Revolving at 18% of Revenues
Fitch views the company's liquidity position as adequate for the
rating category. LATAM recently completed the capital injection
from Qatar Airways (QA) in exchange for 10% of the airline's total
shares. LATAM held cash of USD1.4 billion as of Sept. 30, 2016,
compared with short-term debt of USD1.8 billion. The USD613.5
million capital injection occurred during fourth-quarter 2016.
LATAM's liquidity is expected to remain approximately USD1.5
billion during 2017-2018.
Since December 2016 LATAM has in place a senior secured revolving
credit facility (RCF) of approximately USD325 million. The RCF is
collateralized by a combination of aircraft, spare engines and
spare parts. Including RCF, the company's level of liquidity,
measured as total cash and marketable securities plus unused
committed credit lines over LTM revenues, is expected to be around
18% during 2017.
LATAM faces debt amortizations of USD1.5 billion and USD952
million during 2017 and 2018, respectively, which will be
primarily addressed through the combination of FCF generation and
refinancing. The company's 2017 FCF generation is estimated in the
USD500 million to USD700 million range. Furthermore, the company's
coverage ratio, measured as EBITDAR/(Net Interest Exp. + Rents),
is expected to be at 2.4x and 2.6x in 2017 and 2018, respectively.
FULL LIST OF RATING ACTIONS
Fitch has affirmed the following ratings:
LATAM Airlines Group S.A.:
-- Long-term Foreign Currency IDR at 'B+';
-- National Equity Rating at 'Primera Clase Nivel 3 (cl)'
-- USD500 million senior unsecured note due 2020 at 'B+/RR4'.
TAM S.A.
-- Long-term Foreign Currency IDR at 'B+';
-- Long-term Local currency IDR at 'B+';
-- National long-term rating at 'A-(bra)'.
Tam Linhas Aereas S.A.
-- Long-term Foreign Currency IDR at 'B+';
-- Long-term Local currency IDR at 'B+';
-- National long-term rating at 'A-(bra)'.
Tam Capital Inc.
-- USD300 million senior unsecured note due 2017 at'B+/RR4'.
Tam Capital Inc. 3
-- USD500 million senior unsecured note due 2021 at 'B+/RR4'.
The Rating Outlook for the corporate ratings has been revised to
Stable from Negative.
===========
M E X I C O
===========
DESARROLLADORA HOMEX: Goldberg Law Probes Firm
----------------------------------------------
Goldberg Law PC disclosed that it is investigating Desarrolladora
Homex S.A.B. de C.V., concerning possible violations of federal
securities laws.
If one purchased or otherwise acquired Desarrolladora shares and
would like more information regarding the investigation, Goldberg
Law encourages one to contact Michael Goldberg or Brian Schall, of
Goldberg Law PC, 1999 Avenue of the Stars Suite 1100, Los Angeles,
CA 90067, at 800-977-7401, to discuss one's rights without cost to
you. The firm can be reached at its website at
http://www.Goldberglawpc.com,or by email at
info@goldberglawpc.com
The SEC revealed that Homex agreed to settle charges that it
announced artificial sales of more than 100,000 homes with the
intention of increasing revenues.
According to the SEC, the Company inflated the amount of homes
purchased during a three-year period by about 317% and overstated
its revenue by 355% (or approximately $3.3 billion). It was
delisted from the New York Stock Exchange in May 2014.
Goldberg Law PC represents shareholders around the world and
specializes in securities class actions and shareholder rights
litigation.
About Homex
Desarrolladora Homex, S.A.B. de C.V. is a vertically integrated
home-development company focused on affordable entry-level and
middle-income housing in Mexico.
* * *
As reported in the Troubled Company Reporter-Latin America on
Oct. 20, 2015, Reuters reported that Desarrolladora Homex, S.A.B.
de C.V., which emerged from bankruptcy proceedings in July 2015,
said that the national securities regulator CNBV has cleared its
shares to trade again.
Homex shares were suspended 2014, when a debt crisis and lack
of demand for its homes prompted the company to file for
bankruptcy.
GRUPO UNICOMER: Fitch Rates Proposed USD350MM Sr. Notes BB-
-----------------------------------------------------------
Fitch Ratings has assigned an expected rating of 'BB-(EXP)' to
Grupo Unicomer Company Limited's (Grupo Unicomer, formerly Regal
Forest Holding Co. Ltd.) up to USD350 million proposed senior
unsecured notes due in 2024. The notes will be guaranteed by Grupo
Unicomer's subsidiaries representing approximately 87% of the
consolidated EBITDA as of, and for the last 12 months (LTM) ended
Dec. 31, 2016. Net proceeds will be used to refinance existing
debt, (mainly at the holding level).
The rating reflects the company's leading business position in
most of the countries where it operates and the solid financial
position of its main shareholders. The rating also incorporates
Grupo Unicomer's geographic and format diversification that have
contributed to positive consolidated cash flows from operations
(CFFO) throughout economic cycles. The company has been reporting
stable operational results based on a business model that targets
low-income to middle-income segments.
Grupo Unicomer's ratings are limited by its operating environment
considering the countries in which it operates, with low sovereign
ratings and its growth strategy through acquisitions, funded
mainly with debt, which in turn has prevented it from reducing
consolidated leverage.
KEY RATING DRIVERS
Operating Environment and Format Diversification:
Grupo Unicomer has commercial operations in 24 countries across
Central America, South America and the Caribbean. The company has
a track record of more than 16 years in consumer durables sales,
which has enabled it 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. The company maintains a leading business
position in the selling of consumer durables goods, supported by
its proprietary financing services and economies of scale in terms
of purchasing power and logistics.
Geographic Diversification:
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 any individual market.
Costa Rica, U.S., Jamaica, Trinidad and Tobago, Guatemala and
Honduras are among the most important cash flow contributors,
giving the company some strength and stability to its operating
cash flows. Most of the other countries where the company operates
are placed within the 'B' rating category. The company has several
store formats and brands across their operations.
Positive Cash Flow from Operations:
For the LTM ended December 2016, the company generated USD35.3
million of CFFO. Fitch expects the company's CFFO to remain
positive during 2017-2020. Grupo Unicomer is executing an
investment plan for the next four years in order to keep its
business position and recover the profitability margins it had in
the past (around 13.5% of EBITDA margin). Capex levels should be
around USD44 million per year during the medium term excluding
potential acquisitions. In 2015-2016, the company acquired two
retail chains, one in Paraguay and the other in the Caribbean
countries of Bonaire, Curacao and St. Maarten.
Historically, Grupo Unicomer has consistently maintained positive
CFFO throughout economic cycles. The company has had the
flexibility to adjust its operations 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.
Ambitious Growth Funded Mainly with Debt:
Historically, Grupo Unicomer has expanded its operations through a
combination of organic and inorganic growth. Since its inception,
the company has done 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. As of December 2016, lease adjusted debt to EBITDAR was
4.8x, an increase from 4.5x registered a year ago, mainly due to
the debt related to the funding of the ElectroFacil and Omni
acquisitions in December 2015 and April 2016, respectively. Fitch
expects the company to maintain this ratio at 4.7x by the end of
March 2017 and to reduce it to around 4.2x-4.4x in the medium
term.
Credit Spread Offsets Moderate Level of Overdue Accounts:
The company's consumer finance strategy includes sufficient
financial spreads to cover credit risks associated with the
portfolio. During the last five years, the portfolio yield after
deducting uncollectable expenses and write-offs has been nearly
40% on average. While more than half of retail sales are on credit
originated by Grupo Unicomer, the company has started offering
cash loans to their customers, which in Fitch's view are riskier.
As of Dec. 31, 2016, Grupo Unicomer's portfolio had an average of
6.9% of non-performing loans (NPL, past due accounts for 90 days
or more), similar to the level presented in March 2016. As of
December 2016, the company has NPLs provisions equivalent to 90%
of those non-performing loans. The level of overdue accounts is
partially offset by the company's efficient collection program and
portfolio yield.
Shareholders' Sound Financial Position:
The ratings consider the sound financial position of Grupo
Unicomer's shareholders Milady Group (Milady 50%) and El Puerto de
Liverpool, S.A.B. de C.V. (Liverpool 50%), with a proven track
record in retail since 1847. Milady's operations include real
estate developments, department store chains, all Inditex's
franchises in Central America, and a vertically integrated textile
manufacturing and wholesaling business. Liverpool ('BBB+'/Outlook
Stable), a department store with 122 units and 25 shopping malls
in Mexico, had USD4.9 billion in total revenues in 2016 with 16%
of EBITDA margin. Liverpool's total adjusted debt/EBITDAR was 1.9x
for the same period.
KEY ASSUMPTIONS
Fitch's key assumptions within the rating case for Grupo Unicomer
include:
-- Revenue growth of 4.2% on average for 2017-2020;
-- EBITDA margin of 12.2% for year-end 2017 and close to 13%
going forward;
-- Total Lease Adjusted Debt to EBITDAR of 4.0-4.4x in the
medium term;
-- Dividend payments equivalent to 27% of net income for 2017-
2020;
-- Stable portfolio credit quality;
-- Potential inorganic growth in 2018.
RATING SENSITIVITIES
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.
Future developments that may individually or collectively lead to
a positive rating action include: diversification of operating
subsidiaries in countries with higher sovereign risk, total
adjusted leverage below 3.5x on a sustained basis, simplification
of the company's debt structure, and significant reduction on its
current maturities that result in a consistent ratio of cash plus
CFFO-to-short-term debt of 1.0x.
LIQUIDITY
Liquidity is adequate. As of Dec. 31, 2016, Grupo Unicomer
reported total adjusted debt of USD1.2 billion, of which USD334
million was classified as short-term. This level of current debt
compares with USD53 million of cash and marketable securities and
USD80 million of uncommitted undrawn revolving credit facilities.
The company benefits from potential liquidity of its USD640
million of short term account receivables from the consumer
finance unit.
The company's main source of liquidity is internal cash generation
consisting of positive CFFO. Cash and equivalents of USD53 million
and a short-term net receivables portfolio of USD640 million
further support the company's liquidity. The company's liquidity
ratio, measured as FCF plus cash and marketable securities over
short-term debt, was 0.1x as of Dec. 31, 2016; including short-
term account receivables in the calculation the ratio increases to
2.0x.
FULL LIST OF RATING ACTIONS
Fitch currently rates Grupo Unicomer:
-- Long-Term Foreign Currency Issuer Default Rating (IDR) 'BB-';
-- Long-Term Local Currency IDR 'BB-'.
The Rating Outlook is Stable.
NEMAK SAB: S&P Assigns 'BB+' Rating on Proposed EUR500MM Notes
--------------------------------------------------------------
S&P Global Ratings assigned its 'BB+' issue-level rating to Nemak
S.A.B. de C.V.'s (BB+/Positive/--) proposed EUR500 million senior
unsecured notes. At the same time, S&P assigned its recovery
rating of '3' to the notes, indicating its expectation for a
meaningful (50% to 70%) recovery in the event of a payment
default. S&P's ratings on Nemak, including S&P's 'BB+' long-term
corporate credit rating, are unchanged.
Nemak plans to use the proceeds to refinance existing debt,
including its syndicated loans due 2018 and 2020. S&P expects the
proposed transaction to improve Nemak's debt maturity profile by
extending the average debt term from about four years to about
six, further supporting company's adequate liquidity assessment.
Additionally, S&P considers that the transaction will balance
Nemak's debt mix by matching it with revenue denominated in euros,
which account for approximately 30% of total revenue.
In connection with the note offering, the recovery rating on
Nemak's outstanding senior unsecured notes remains unchanged at
'3'. The '3' recovery rating indicating S&P's expectation for a
meaningful (50% to 70%; rounded estimate: 55%) recovery in the
event of payment default. The issue-level rating on the company's
new senior unsecured notes is 'BB+', the same as the corporate
credit rating. S&P takes additional comfort from the fact that
Nemak's debt instruments are fully unconditionally and irrevocably
guaranteed on a senior unsecured basis by its most important
subsidiaries, which account for 67.1% and 83.5% of the company's
consolidated assets and EBITDA, respectively, as of Dec. 31, 2016.
Alfa S.A.B. de C.V. (BBB/Stable/--) owns 75.24% of Nemak. S&P
views Nemak as a moderately strategic subsidiary to Alfa because
S&P believes it's important to the group's long-term strategy and
is likely to receive support, if necessary.
Key analytical factors
-- S&P has completed a review of the recovery analysis, and the
recovery and issue-level ratings on the company's senior
unsecured notes due 2023 and proposed senior unsecured notes
due 2024.
-- S&P has valued the company on a going-concern basis using a
5.0x multiple of its projected emergence EBITDA.
-- S&P estimates that for the company to default, its EBITDA
would need to plummet, representing deterioration of the
business, which could result from factors such as adverse
macroeconomic conditions that dent the demand for new
vehicles, disruption in the supply chain of the industry,
and loss of contracts awarded.
Simulated default assumptions
-- Simulated year of default: 2022
-- EBITDA at emergence: MXN3.9 billion
-- EBITDA multiple 5.0x
Simplified waterfall
-- Net enterprise value (EV: after 5% admin. costs):
MXN18.5 billion
-- Recovery rating: '3'
-- Recovery expectations: 50% to 70% (rounded estimate: 55%)
RATINGS LIST
Nemak S.A.B. de C.V.
Corporate credit rating BB+/Positive/--
Ratings Assigned
Nemak S.A.B. de C.V.
EUR500M sr. unsec. notes BB+
Recovery rating 3
NEMAK SAB: Fitch Rates EUR500MM Senior Unsecured Notes BB+
----------------------------------------------------------
Fitch Ratings has assigned a 'BB+' rating to Nemak, S.A.B. de
C.V.'s (Nemak) EUR500 million senior unsecured notes due in 2024.
The notes are guaranteed by Nemak's subsidiaries that represented
67% of the consolidated total assets and around 84% of the
consolidated EBITDA during 2016. Net proceeds will be used to
repay existing debt. A full list of Nemak's ratings is provided at
the end of this release.
The ratings reflect Nemak's business position as a large Tier-1
supplier of aluminum components, regional and product-portfolio
diversification, low cost structure and solid funds from
operations. The ratings also reflect the cyclicality of the
automotive industry, the company's still large concentration in
North America and its exposure to Detroit's three original
equipment manufacturers (OEMs). Other concerns include the
company's acquisitive nature and at times significant capex
requirements. Fitch projects that the company should be able to
comfortably reduce its debt/EBITDA leverage to around 1.5x by 2018
due to strong operating cash flow from 1.8x in 2016.
KEY RATING DRIVERS
Positive Outlook
The revision of the Outlook to Positive in November of 2016
reflects Fitch's view that Nemak's credit metrics should continue
to strengthen over the next two to three years, as demand for the
company's high value-added aluminum engine blocks and structural
products should remain sound, and result in compound annual
consolidated equivalent volume growth of around 3%. Much of the
growth is expected to come from the company's products in Europe
and Asia. The expansion of OEMs in Mexico should also bolster
demand.
Adverse U.S. Trade Policy Manageable
Nemak's credit profile should endure the near-term threats that
protectionist policies in the U.S. are likely to bring to the
North American automotive industry. The company is the sole global
supplier for its clients in about 85% of the products they sell.
It is also the main supplier of aluminum cylinder heads and engine
blocks in both the U.S. and Mexico. Competitive threats that could
substituted Nemak's products are not likely to arise in the near
term due to the company's strong competitive position and
expertise in producing cylinder heads and engine blocks using
aluminum castings.
Strong Global Business Position
Nemak's presence in high-growth regions, such as Asia and its high
percentage of installed capacity in low-cost countries complements
its strong business position in Europe and the Americas, is
factored in the ratings. The company's long-term customer
relationships, its use of aluminium price pass through contracts
that reduce raw material volatility, its position as an essential
supplier for Detroit's OEMs and its participation in several of
the largest global engine platforms are also reflected in the
ratings.
North America Slowing Down
The company derives about two thirds of its EBITDA from North
America, primarily through the sale of components used in the
assembly of vehicles sold in the U.S. where total light vehicle
sales grew strongly during 2009-2015. Fitch believes U.S. vehicle
sales should remain at around 17 million over the intermediate
term, slightly below the 17.5 million registered during 2016.
Nemak has continued to gain incremental business, primarily in
engine blocks and structural components, which should position the
company well to continue to grow volumes despite slower industry
tailwinds in the U.S.
Favorable Operating Performance
Nemak's financial performance continued to strengthen in 2016
primarily due to improved mix of higher value added products, a
strong U.S. dollar, and lower energy prices. The company has also
shown solid performance in Europe where volumes increased 5% in
2016 after growing 8% during fiscal year 2015. Nemak generated
USD796 million of EBITDA during 2016, which compares favorably
with EBITDA of USD757 million in 2015 and USD699 million in 2014.
Fitch is projecting that EBITDA will remain solidly above USD800
million in 2017.
Lower Expected Leverage
Free cash flow (FCF) was USD60 million during 2016 and compares
positively to USD39 million during 2015. Total debt/EBITDA ratio
was 1.8x at year-end 2016, similar to the 1.7x registered in 2015.
Fitch estimates neutral to positive FCF in 2017 as the company
continues to invest in expanding its casting and machining
capabilities to serve new programs awarded. Net leverage should be
around 1.5x in 2017 compared to 1.6x at year-end 2016. Nemak's
total debt including capital leases as of year-end 2016 was USD1.4
billion.
KEY ASSUMPTIONS
-- North America auto production flattens-out over the
intermediate term.
-- Equivalent unit volume grows low to mid-single digits over
the intermediate term.
-- Total debt below USD1.4 billion over the intermediate term.
-- Capex of around USD430 million in 2017 and modestly declining
in subsequent years.
-- Dividends of about USD170 million per year.
-- The U.S. dollar exchange rate against the Mexican peso does
not weaken significantly below MXN20:USD1.
RATING SENSITIVITIES
Future developments that may, individually or collectively, lead
to a positive rating action include:
-- Gains in product, customer or geographical diversification
coupled with increased volumes that lead to continued
strength in EBITDA generation;
-- Sustained positive FCF (FCF margin around 3%);
-- Sustained levels of total debt/EBITDA around 1.5x;
-- Strong liquidity supported by a healthy combination of cash,
FCF generation and committed credit facilities relative to
upcoming debt obligations.
Future developments that may, individually or collectively, lead
to a negative rating action include:
-- A severe decline in North American vehicle production that
leads to reduced demand for Nemak's products;
-- A reduction in EBITDA generation resulting in total
debt/EBITDA above 3x for a sustained period of time;
-- Sustained negative FCF;
-- Sustained weak liquidity relative to upcoming debt
obligations;
-- Large acquisitions or investments financed mostly with debt
resulting in an expectation of higher leverage levels in the
mid- to long term.
LIQUIDITY
Nemak's liquidity position is considered sound. As of year-end
2016, the company's short-term debt was USD165 million. This debt
is mostly composed of working capital financing and bank debt
amortizations, which favorably compares to USD129 million of non-
restricted cash and USD349 million in undrawn committed credit
lines maturing predominantly in 2018 and 2019. Fitch projects
Nemak's cash flow from operations (CFFO) should remain strong at
around USD600 million. Pro forma after the issuance, Nemak will
face no significant debt maturities until 2023 when its USD500
million notes are due.
FULL LIST OF RATINGS
Fitch currently rates Nemak:
-- Long-Term Foreign Currency Issuer Default Rating (IDR) 'BB+';
-- Long-Term Local currency IDR 'BB+';
-- Long-term national scale rating 'AA-(mex)';
-- USD500 million senior unsecured notes due 2023 'BB+'.
The Rating Outlook is Positive.
NEMAK SAB: Moody's Rates Proposed EUR500MM Sr. Unsec. Notes Ba1
---------------------------------------------------------------
Moody's Investors Service assigned a Ba1 senior unsecured rating
to Nemak's proposed 7-year EUR500 million senior unsecured notes.
Proceeds from the notes will be used to refinance existing bank
debt. The outlook on the rating is positive.
RATINGS RATIONALE
Nemak's ratings incorporate its strong credit metrics for the
rating category; its high profitability as compared to other
industry peers; its leading position in the aluminum engine blocks
and cylinder head market; and its key supplier relationships with
many of the major automakers. Additional rating considerations are
the inherent cyclicality of the auto manufacturing industry; the
company's sales concentration with the top three US automakers,
which account for 60% of its volumes; its smaller scale when
compared to global peers; and its product focus into three main
segments with the same demand drivers.
The proposed transaction will improve Nemak's debt maturity
profile and match its Euro-denominated liabilities with its Euro-
denominated cash flow. With the proceeds of the proposed issuance,
Nemak plans to refinance existing debt maturing through 2020. Pro-
forma for the issuance of the notes, Nemak's debt maturity profile
as of December 31, 2016 will be: $89 million due 2017, $6 million
due 2018, $44 million due 2019, $45 million due 2020, $16 million
due 2021, $22 million due 2022, $530 million due 2023, $584
million due 2024, and $65 million due 2025. Pro-forma for the
issuance of the notes and debt refinancing, Nemak's leverage
should remain unchanged with Moody's adj. debt/EBITDA of 2.0 times
as of December 31, 2016.
Nemak's operations are closely linked to the performance of the
automotive industry in North America. Nemak's exposure to cyclical
industry trends is high, nevertheless, its proven resilience in
terms of profitability and ability to quickly adjust its costs
under shifting industry conditions is credit positive.
Furthermore, the different market dynamics of Nemak's
geographically diversified revenue base should help offset some
regional trends within the automotive industry and its high
exposure to the OEMs in the NAFTA region.
While the final changes to trade conditions between Mexico and the
U.S. are still unclear, Moody's assumes that the outcome will hurt
Mexican auto parts suppliers top line and/or profitability.
Nevertheless, Moody's considers that, in the short-to-medium term,
a shift of auto parts production away from Mexico is a high-impact
but low probability event. There is an intricate supply-chain and
economic integration between Mexico and the U.S. that makes a
supplier replacement a costly and lengthy process.
Nemak has several strengths that mitigate the risk of negative
changes in trade conditions between Mexico and the U.S., which
include: (i) only 20% of Nemak's sales are Mexican exports to the
U.S., (ii) Nemak is the sole source supplier in around 85% of its
volumes including various U.S. automakers, (iii) Nemak
manufactures highly complex products with long average life and
long-term contracts with high switching costs, and (iv) Nemak's
existing facilities in the U.S. allow it to add new capacity and
shift production into the U.S. if required.
Nemak's liquidity is adequate. The company had cash on hand of
$129 million as of December 31, 2016, covering 73% of its short-
term debt. As alternate sources of liquidity, Nemak has committed
credit facilities of around $350 million that are fully available
and advised lines of credit for over $800 million that it uses to
cover seasonal working capital requirements.
The positive outlook on Nemak's ratings reflects Moody's
expectations that Nemak will continue strengthening its credit
metrics while improving profitability despite softer demand in the
global manufacturing industry.
Nemak's ratings could be upgraded if the company maintains its
profitability and capital expenditures level such that it
generates positive free cash flow over the next 18 months. To be
considered for an upgrade, the company should continue its prudent
financial policies, maintain strong liquidity and credit metrics
with adj. debt/EBITDA around 1.5 times and adj. EBITA/Interest
expense over 5 times.
The ratings could be downgraded if the company's margins are
affected by unfavorable dynamics or adverse changes in the
company's market position. Also, a deterioration of credit metrics
with debt/EBITDA increasing over 3.0 times and EBITA/Interest
expense declining below 3.5 times or negative free cash flow
generation could lead to a downgrade
The principal methodology used in these ratings was Global
Automotive Supplier Industry published in June 2016.
Nemak, S.A.B. de C.V. is a subsidiary of Alfa, S.A.B. de C.V.
(Baa3, stable), a publicly traded Mexican business group. Nemak
specializes in the development and manufacturing of high-tech,
complex aluminum components for powertrain, body and structure
applications, and electric vehicle components for light vehicles,
with a customer base of more than 60 customers worldwide with 60%
of sales volume coming from the "Big-3" OEMs (Ford, GM, and Fiat
Chrysler). Nemak products are sold mainly in North America,
Europe, South America, and China. The company is 75.24% owned by
Alfa, and 5.45% owned by Ford Motor Co. with the remaining 19.31%
in public float. During the last twelve months ended December 31,
2016, Nemak reported revenues and EBITDA of $4.3 billion and $798
million, respectively.
===============
P A R A G U A Y
===============
TELEFONICA CELULAR: Fitch Affirms BB+ Long-Term IDRs
----------------------------------------------------
Fitch Ratings has affirmed the Long-Term Foreign Currency Issuer
Default Ratings (IDRs) of Telefonica Celular del Paraguay S.A.
(Telecel) at 'BB+' with a Stable Outlook. Fitch has also affirmed
Telecel's USD300 million senior unsecured notes at 'BB+.'
Telecel's ratings reflect its leading market positions in
Paraguay, supported by its extensive network and distribution
coverage, and the strong brand recognition of Tigo. The company's
competitive strengths have enabled stable operational cash flow
generation and high margins, resulting in the company's solid
financial profile, with leverage that is considered low for the
rating category. Negatively, the company's ratings are tempered by
its persistent negative free cash flow (FCF) generation, amid
intense competition.
Telecel's ratings also reflect a strong linkage between the
company and its parent, Millicom International Cellular S.A (MC;
'BB+'/Outlook Stable), given Telecel's strategic and financial
importance to the parent. The company also benefits from synergies
related to MIC's larger scale and management expertise. Telecel is
a 99.98%-owned subsidiary of MIC.
KEY RATING DRIVERS
Solid Market Position: Telecel is the largest telecom operator in
Paraguay, with revenue market shares of about 64% in mobile and
58% in fixed-line services. As the first mobile operator in the
country, the company has established an entrenched position with
the most extensive network and distribution channels under the
strong Tigo brand, shared among MIC's group companies globally.
The company continues to strengthen its competitive position in
fixed-line services, partly through acquisitions, which will help
Telecel maintain its leading market position.
Positive Revenue Diversification: Telecel's Home segment is
expected to continue double-digits revenue growth. The mobile
segment, which is Telecel's most important business as it
generates about 70% of its revenues, is expected to weaken over
the medium-to-long term as a result of declining voice/SMS
revenues and competitive pressures. Positively, demand in fixed
line services remains strong, given the low penetration of
services in Paraguay. Fitch expects Telecel's Home and B2B segment
to represent close to 40% of total revenues by 2019 supported by
the continued expansion of its network coverage.
Stable Profitability: Fitch projects the company's stable
operating margins to continue in the short-to-medium term.
Telecel's margin is expected to recover towards 46% during 2016,
compared to 43% at year-end 2015 as a result of a higher
proportion of service revenue and lower operating costs during the
period. Further margin expansion could be limited due to
competitive pressures and an increasing revenue contribution from
lower-margin pay-tv and broadband services. Nevertheless,
Telecel's projected margin of 44%-45% over the medium term is
considered to be solid compared to its regional telecom peers.
Negative FCF: Telecel's negative FCF generation is unlikely to
reverse in the medium term due to its high dividends. Pre-dividend
FCF generation is expected to remain solid as its capex budget can
be comfortably covered by its operational cash flow generation.
Fitch estimates capex during 2017-2018 will remain close to PYG600
billion annually, which would be covered by its cash flow from
operations (CFFO) generation, projected to be around PYG1.2
trillion annually. Negatively, Fitch expects the company's cash
flow upstream to its parent, Millicom, will remain high given its
relatively stable financial position, which will pressure its FCF
margin into negative territory.
Low Leverage: Fitch believes Telecel's solid financial profile
will remain intact over the medium term, backed by its operational
cash flow generation. Despite the expected continued negative FCF,
the company's net leverage should remain below 2.0x over the
medium term, as a result of its growing EBITDA. The company's net
leverage ratio was 1.4x as of Sept. 30, 2016, which remained
unchanged from 2015 year-end. This level of net leverage is
considered low for the rating category.
DERIVATION SUMMARY
Telefonica Celular del Paraguay is well-positioned relative to its
regional telecom peers in the 'BB' category based on its high
profitability and low leverage, and its leading mobile market
position, backed by its solid network competitiveness and strong
brand recognition. Telecel boasts a strong financial profile with
high profitability and low leverage for the rating level, compared
to its regional telecom peers in the same rating category. The
company's weak geographic and revenue diversification, as well as
its high shareholder return temper the credit. Parent/subsidiary
linkage is applicable given MIC's strong influence over Telecel's
operations and MIC's reliance on Telecel's dividend upstream. The
ratings are not constrained by the Country Ceiling of Paraguay.
KEY ASSUMPTIONS
Fitch's key assumptions within Fitch rating case for the issuer
include:
-- Low-single-digits revenue growth mainly driven by strong
growth in the fixed-line operation;
-- EBITDA margin to recover to 46% in 2016 from 43% in 2015;
-- Capex, including spectrum, to increase to 24% in 2016 due
to network coverage expansion;
-- Negative FCF generation to remain uncurbed in the medium
term;
-- Net leverage to decline to below 1.5x over the medium term.
RATING SENSITIVITIES
Future Developments That May, Individually or Collectively, Lead
to Positive Rating Action:
A positive rating action on Telecel would likely be linked to a
positive rating action on MIC. During 2016, MIC's overall
financial profile remained stable, partly driven by continued
successful integration of UNE and Tigo in Colombia. MIC's business
position and overall financial profile continue to be solid for
the rating category. As a holding company, MIC improved its
ability to mitigate dividend risk from its subsidiaries due to
potential sovereign constraints when it obtained a five year, $600
million revolving credit facility. Continued improvement in MIC's
overall financial results could lead to positive rating actions
for both entities.
Future Developments That May, Individually or Collectively, Lead
to Negative Rating Action:
-- Continued deterioration in the company's EBITDA generation
along with weak revenue growth due to competitive pressures,
including material loss in mobile market share, ARPU erosion,
and substantial increase in marketing expenses;
-- Persistent negative FCF generation due to aggressive
shareholder distributions and/or higher-than-expected capex;
-- Adjusted net leverage increasing to above 3.0x in conjunction
with a weak liquidity profile on a sustained basis;
-- A negative rating action on MIC's ratings could also
negatively affect Telecel's ratings.
LIQUIDITY
Adequate Liquidity: Telecel's liquidity position is adequate,
supported by stable cash flow generation and a cash balance of
PYG338 billion, which fully covered its short-term debt of PYG56
billion as of Sept. 30, 2016. The company has a high exposure to
foreign exchange risk, as its debt is largely denominated in U.S.
dollars, while its EBITDA generation is mostly in local currency.
Positively, the risk is manageable, as the company does not face
any U.S. dollar debt maturities until 2022, when its USD300
million notes become due.
FULL LIST OF RATING ACTIONS
Fitch has affirmed the following ratings:
Telefonica Celular del Paraguay S.A.
-- Long-Term Foreign Currency IDR at 'BB+', Stable Outlook;
-- Long-Term Local Currency at IDR 'BB+', Stable Outlook;
-- USD300 million senior unsecured notes at 'BB+.'
====================
P U E R T O R I C O
====================
PR WIRELESS: Moody's Puts Caa1 CFR Under Review for Upgrade
-----------------------------------------------------------
Moody's Investors Service placed the Caa1 corporate family and
senior secured ratings of PR Wireless, Inc. under review for
upgrade. The action follows the announcement of an agreement
between Sprint Corporation (B2 stable) and PR Wireless, operating
under the brand name "Open Mobile", to combine their businesses in
Puerto Rico and in the US Virgin Islands into a joint venture.
Under the proposal, Sprint and PR Wireless will have a 68% and 32%
economic interest, and a 55% and 45% voting interest,
respectively, in the joint venture. The review period will focus
on gathering additional information and confirming the final
capital structure while Federal Communications Commission (FCC)'s
and other regulatory approvals are obtained.
Issuer: PR Wireless, Inc.
-- Probability of Default Rating, Placed on Review for Upgrade,
currently Caa1-PD
-- Corporate Family Rating, Placed on Review for Upgrade,
currently Caa1
-- Senior Secured Bank Credit Facility, Placed on Review for
Upgrade, currently Caa1
RATINGS RATIONALE
Under the joint venture, PR Wireless lenders will benefit from
Sprint's larger scale and stronger credit profile, a more robust
operation with the combined networks and subscriber bases of both
companies in the region, as well as operating synergies. According
to Moody's estimates, the Sprint operation in Puerto Rico and the
U.S. Virgin Islands will contribute little to no debt. Under the
agreement, PR Wireless assets and liabilities, including its
outstanding debt, will be transferred to the joint venture and
combined with Sprint's assets. The joint venture will consequently
be consolidated into higher-rated Sprint's balance sheet and the
impacts won't be material for Sprint's credit metrics due to its
comparatively much larger size.
The integrated businesses will benefit from operational synergies,
including the consolidation of postpaid, prepaid, Lifeline and
other business services with increased scale, expanded
distribution, improved network capacity, faster speed, and a
deeper spectrum position. The companies will continue to operate
separately under their current brands until the transaction
closes.
PR Wireless is the 4th largest wireless service provider in Puerto
Rico with 3G and 4G networks. PR Wireless began operations in June
2007 after the bankruptcy and reorganization of its predecessor
entity, MoviStar, Inc. During the last twelve months ended
September 30, 2016, the company generated revenues of $147
million.
With headquarters in Overland Park, Kansas, Sprint and its
subsidiaries form one of the largest telecommunications companies
in the United States. It offers digital wireless services in
addition to a broad suite of wireline communications services.
Sprint is the fourth largest wireless carrier in the U.S. with
approximately 60 million subscribers. During the last twelve
months ended September 30, 2016, the company generated $32 billion
in revenues.
================================
T R I N I D A D & T O B A G O
================================
DIGICEL GROUP: Denies Security Breach
-------------------------------------
Caribbean360.com reports that telecommunications company Digicel
Group insists its network is safe, reliable and secure, following
a claim that Trinidad and Tobago's prime minister may have had
some of his text messages and emails intercepted.
Caribbean360.com, citing The Sunday Express, notes that Dr. Keith
Rowley had directed Cabinet members to switch the provider for
their work phones to bmobile after police officers disclosed to
him that Reshmi Ramnarine, who once headed the country's highest
level security unit, is currently employed as an account manager,
business solutions, at Digicel Group (Information Technology and
Services).
The police had been investigating a report from Rowley that he was
being inundated with a series of text messages from a particular
cell number, the report relays. The texter had reportedly asked
to meet with Rowley and indicated that they had intercepted and
retrieved text messages and e-mails belonging to him, the report
discloses.
But according to the Trinidad Express, Digicel issued a statement
saying "there has never been a substantiated claim of this kind in
the history of our company's operations in the Caribbean and over
the past 11 years of our presence in Trinidad and Tobago," the
report relays.
"Since the emergence of such a claim, we have conducted an
extensive audit of all operations related to these technical
functions and have found absolutely no breach in our security
systems," it added, the report says.
Digicel Group sought to assure customers of the integrity of its
stringent security systems, which it said are designed to
guarantee the highest level of privacy to all users of its mobile
network, the report notes.
"This has been secured at high cost and is rigidly maintained
through an IT infrastructure that is safe and secure," it
insisted, adding that guaranteeing the safety and security of
customer records of all kinds forms the basis of its relationship
with its subscribers, the report adds.
As reported in the Troubled Company Reporter-Latin America on
May 27, 2016, Fitch Ratings has affirmed the ratings of Digicel
Group Limited (DGL) and its subsidiaries Digicel Limited (DL) and
Digicel International Finance Limited (DIFL), collectively
referred to as 'Digicel' as follows.
DGL
-- Long-Term Issuer Default Rating (IDR) at 'B'; Stable Outlook;
-- $US 2.0 billion 8.25% senior subordinated notes due 2020 at
'B-/RR5';
-- $US 1 billion 7.125% senior unsecured notes due 2022 at
'B-/RR5'.
DL
-- Long-Term IDR at 'B'; Stable Outlook;
-- $US 250 million 7% senior notes due 2020 at 'B/RR4';
-- $US 1.3 billion 6% senior notes due 2021 at 'B/RR4';
-- $US 925 million 6.75% senior notes due 2023 at 'B/RR4';
DIFL
-- Long-Term IDR at 'B'; Stable Outlook;
-- Senior secured credit facility at 'B+/RR3'.
The Rating Outlook is Stable.
=================
X X X X X X X X X
=================
* BOND PRICING: For the Week From March 6 to March 10, 2017
-----------------------------------------------------------
Issuer Name Cpn Price Maturity Country Curr
----------- --- ----- -------- ------- ---
BA-CA Finance Cayman Lt 0.518 62.07 KY EUR
CSN Islands XII Corp 7 68 BR USD
CSN Islands XII Corp 7 67.75 BR USD
Decimo Primer Fideicomi 4.54 52.63 10/25/2041 PA USD
Decimo Primer Fideicomi 6 63.5 10/25/2041 PA USD
Dolomite Capital Ltd 13.26 67.2 12/20/2019 CN ZAR
Empresa de Telecomunica 7 73.14 1/17/2023 CO COP
Empresa de Telecomunica 7 73.14 1/17/2023 CO COP
ESFG International Ltd 5.75 0.66 KY EUR
General Shopping Financ 10 72.5 KY USD
General Shopping Financ 10 71.7 KY USD
Global A&T Electronics 10 74 2/1/2019 SG USD
Global A&T Electronics 10 74.5 2/1/2019 SG USD
Global A&T Electronics 10 65.5 2/1/2019 SG USD
Global A&T Electronics 10 65 2/1/2019 SG USD
Gol Finance 8.75 63 BR USD
Gol Finance 8.75 63.88 BR USD
Gol Linhas Aereas SA 10.75 34.63 2/12/2023 BR USD
Gol Linhas Aereas SA 10.75 34.63 2/12/2023 BR USD
Inversora Electrica de 6.5 55 9/26/2017 AR USD
Inversora Electrica de 6.5 55 9/26/2017 AR USD
MIE Holdings Corp 7.5 75.16 4/25/2019 HK USD
MIE Holdings Corp 7.5 75.26 4/25/2019 HK USD
NB Finance Ltd/Cayman I 3.88 58.01 2/7/2035 KY EUR
Newland International P 9.5 19.88 7/3/2017 PA USD
Newland International P 9.5 19.88 7/3/2017 PA USD
Noble Holding Internati 5.25 72.98 3/15/2042 KY USD
Ocean Rig UDW Inc 7.25 39 4/1/2019 CY USD
Ocean Rig UDW Inc 7.25 38 4/1/2019 CY USD
Odebrecht Drilling Norb 6.35 48.5 6/30/2021 KY USD
Odebrecht Drilling Norb 6.35 47.25 6/30/2021 KY USD
Odebrecht Finance Ltd 7.5 49 KY USD
Odebrecht Finance Ltd 4.3 48.29 4/25/2025 KY USD
Odebrecht Finance Ltd 7.12 48.2 6/26/2042 KY USD
Odebrecht Finance Ltd 5.25 46.15 6/27/2029 KY USD
Odebrecht Finance Ltd 7 57.02 4/21/2020 KY USD
Odebrecht Finance Ltd 5.12 53.51 6/26/2022 KY USD
Odebrecht Finance Ltd 8.25 70.88 4/25/2018 KY BRL
Odebrecht Finance Ltd 6 51.47 4/5/2023 KY USD
Odebrecht Finance Ltd 5.25 45.92 6/27/2029 KY USD
Odebrecht Finance Ltd 7.1 47.82 6/26/2042 KY USD
Odebrecht Finance Ltd 7.5 49.25 KY USD
Odebrecht Finance Ltd 4.3 48.39 4/25/2025 KY USD
Odebrecht Finance Ltd 6 51.77 4/5/2023 KY USD
Odebrecht Finance Ltd 8.2 70.88 4/25/2018 KY BRL
Odebrecht Finance Ltd 7 56.85 4/21/2020 KY USD
Odebrecht Finance Ltd 5.1 52.99 6/26/2022 KY USD
Odebrecht Offshore Dril 6.6 39.64 10/1/2022 KY USD
Odebrecht Offshore Dril 6.7 36.44 10/1/2022 KY USD
Odebrecht Offshore Dril 6.6 38.79 10/1/2022 KY USD
Odebrecht Offshore Dril 6.7 38.75 10/1/2022 KY USD
Petroleos de Venezuela 12.75 67.19 2/17/2022 VE USD
Petroleos de Venezuela 9 58.28 11/17/2021 VE USD
Petroleos de Venezuela 6 40.32 5/16/2024 VE USD
Petroleos de Venezuela 9.75 50.15 5/17/2035 VE USD
Petroleos de Venezuela 6 38.22 11/15/2026 VE USD
Petroleos de Venezuela 5.37 37.39 4/12/2027 VE USD
Petroleos de Venezuela 5.5 37.1 4/12/2037 VE USD
Petroleos de Venezuela 6 41.25 10/28/2022 VE USD
Petroleos de Venezuela 6 40.01 5/16/2024 VE USD
Petroleos de Venezuela 9 58.11 11/17/2021 VE USD
Petroleos de Venezuela 6 38.13 11/15/2026 VE USD
Petroleos de Venezuela 12.75 67.2 2/17/2022 VE USD
Petroleos de Venezuela 9.75 49.94 5/17/2035 VE USD
Polarcus Ltd 5.6 60 3/30/2022 AE USD
Siem Offshore Inc 5.8 49.75 1/30/2018 NO NOK
Siem Offshore Inc 5.59 50.25 3/28/2019 NO NOK
STB Finance Cayman Ltd 2.04 58.35 KY JPY
Sylph Ltd 2.36 50.93 9/25/2036 KY USD
Uruguay Notas del Tesor 5.25 68.02 12/29/2021 UY UYU
US Capital Funding IV L 1.25 51.35 12/1/2039 KY USD
US Capital Funding IV L 1.25 51.35 12/1/2039 KY USD
USJ Acucar e Alcool SA 9.87 67.5 11/9/2019 BR USD
USJ Acucar e Alcool SA 9.87 65.75 11/9/2019 BR USD
Venezuela Government In 9.25 48.75 5/7/2028 VE USD
Venezuela Government In 13.63 82.58 8/15/2018 VE USD
Venezuela Government In 9 51.75 5/7/2023 VE USD
Venezuela Government In 9.37 49 1/13/2034 VE USD
Venezuela Government In 7 71.88 12/1/2018 VE USD
Venezuela Government In 9.25 52 9/15/2027 VE USD
Venezuela Government In 7.65 46.38 4/21/2025 VE USD
Venezuela Government In 13.63 82.58 8/15/2018 VE USD
Venezuela Government In 7.75 61.75 10/13/2019 VE USD
Venezuela Government In 11.95 58.13 8/5/2031 VE USD
Venezuela Government In 6 53.75 12/9/2020 VE USD
Venezuela Government In 12.75 67 8/23/2022 VE USD
Venezuela Government In 7 44 3/31/2038 VE USD
Venezuela Government In 6.5 36.53 12/29/2036 VE USD
Venezuela Government In 8.25 47.75 10/13/2024 VE USD
Venezuela Government In 11.75 57.75 10/21/2026 VE USD
Venezuela Government TI 5.25 69.59 3/21/2019 VE USD
***********
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, Ivy B.
Magdadaro, and Peter A. Chapman, Editors.
Copyright 2017. All rights reserved. ISSN 1529-2746.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.
Information contained herein is obtained from sources believed to
be reliable, but is not guaranteed.
The TCR Latin America subscription rate is US$775 per half-year,
delivered via e-mail. Additional e-mail subscriptions for members
of the same firm for the term of the initial subscription or
balance thereof are US$25 each. For subscription information,
contact Peter A. Chapman at 215-945-7000 or Nina Novak at
202-362-8552.
* * * End of Transmission * * *