/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/171020.mbx T R O U B L E D C O M P A N Y R E P O R T E R L A T I N A M E R I C A Friday, October 20, 2017, Vol. 18, No. 209 Headlines B R A Z I L BANCO DO BRASIL: To Use $1 Billion From Debt Sales in Foreign Ops BANCO DO BRASIL: Fitch to Rate New 2025 Sr. Unsec. Notes BB(exp) BANCO DO BRASIL: Moody's Rates US$20BB EMTN Program (P)Ba2 BANCO NACIONAL: Unduly Paid 20% More for JBS Shares, Says Court COSAN LTD/SA: S&P Affirms 'BB' CCR, Outlook Remains Negative DESENBAHIA: Moody's Withdraws Ba3 LT Local Issuer Ratings MARFRIG GLOBAL: S&P Alters Outlook to Stable on Aggressive Growth TAKATA CORP: FCR Taps Greenberg Traurig as Special Counsel TAKATA CORP: Committee Taps Davies Ward as Canadian Counsel C O S T A R I C A BANCO NACIONAL: Fitch to Rate CRC-Denominated Sr. Notes 'BB' BANCO NACIONAL: Moody's Assigns Ba2 Rating to Global LT Sr. Debt D O M I N I C A N R E P U B L I C DOMINICAN REPUBLIC: Taiwan Angst Amid Playing Footsie With Beijing E C U A D O R ECUADOR: Fitch Assigns 'B' Rating to $2.5-Bil. Notes Due 2027 J A M A I C A JAMAICA: Economy to Get US$20 Billion Boost P U E R T O R I C O BAILEY'S EXPRESS: Can Use Up to $114K in Cash Until Oct. 28 PR GOLD BOND: Hires Luis D Flores Gonzalez Law as Legal Counsel T R I N I D A D & T O B A G O CL FIN'L: CLICO Records a Sixth Profitable Year U R U G U A Y ADMINISTRACION NACIONAL: Moody's Ups CFR to Ba2; Outlook Stable - - - - - =========== B R A Z I L =========== BANCO DO BRASIL: To Use $1 Billion From Debt Sales in Foreign Ops ----------------------------------------------------------------- Reuters reports that state-controlled Banco do Brasil SA will channel $1 billion it raised in seven-year notes to foreign operations, the bank's chief financial officer told journalists on a conference call. The CFO, Alberto Monteiro, also said the company did not plan on selling more foreign debt to bolster capital, according to Reuters. The debt issued on Oct. 18 had built-in yields of 4.7 percent with a coupon of 4.625 percent, the report notes. BANCO DO BRASIL: Fitch to Rate New 2025 Sr. Unsec. Notes BB(exp) ---------------------------------------------------------------- Fitch Ratings has assigned an expected long-term foreign currency rating of 'BB(exp)' to Banco do Brasil S.A.'s (BdB) proposed senior unsecured notes due January 2025. According to the proposal, the issuance will be between USD750 million and USD1 billion. Final amount and interest will be defined upon book building. The bonds' proceeds shall be used for general corporate purposes. The final rating is contingent upon the receipt of final documents conforming to the information already received. KEY RATING DRIVERS The expected rating on the notes corresponds to BdB's Long-Term Foreign Currency Issuer Default Rating (IDR) (BB/Negative) and ranks equal to its other senior unsecured debt. BdB's IDRs are aligned with the sovereign ratings of Brazil and reflect the federal government control and the bank's systemic importance. The probability of the Brazilian government providing support to BdB is moderate, which explains its Support Rating of '3' and its Support Rating Floor of 'BB'. RATING SENSITIVITIES IDRS AND SENIOR DEBT BdB's IDRs and its issuance ratings would be affected by potential changes in the sovereign ratings of Brazil and/or in the sovereign's willingness to provide support to the bank, should the need arise. Fitch currently rates BdB as follows: -- Long-Term Foreign and Local Currency IDRs 'BB', Outlook Negative; -- Short-Term Foreign and Local Currency IDRs 'B'; -- National long-term rating 'AA+(bra)', Outlook Negative; -- National short-term rating 'F1+(bra)'; -- Support Rating '3'; -- Support Rating Floor 'BB'; -- Senior unsecured notes due 2018, 2019, 2020 and 2022 'BB'; -- Viability Rating 'bb-' BANCO DO BRASIL: Moody's Rates US$20BB EMTN Program (P)Ba2 ---------------------------------------------------------- Moody's Investors Service has assigned a (P)Ba2 debt rating to the US$20 billion senior unsecured EMTN Program of Banco do Brasil S.A. (BB), acting through its Grand Cayman branch. Moody's also assigned a long-term foreign currency senior unsecured debt rating of Ba2 to the proposed senior notes takedown in the amount of around US$750 million, denominated and settled in USD, and due in January 2025. The outlook on the senior unsecured debt rating is negative. The notes will be senior unsecured obligations, and will rank pari passu in right of payment with all of BB's existing and future senior unsecured and unsubordinated liabilities. The following ratings were assigned: (P)Ba2 rating to the US$20 billion EMTN Program BACKED (P)Ba2 rating to the US$20 billion EMTN Program Ba2 long-term foreign currency senior unsecured debt rating RATINGS RATIONALE The rating reflects BB's strong funding and moderate profitability, notwithstanding a decline in recent years. However, the rating is constrained by the bank's adjusted capital levels, which remains relatively modest by global standards despite a significant improvement since 2015, as well as Brazil's still challenging operating environment, which has led to an increase in asset risk in recent years. BB has managed to limit the deterioration of its loan book by limiting exposures to riskier borrowers and segments. As a result, non-performing loans have remained relatively stable since June 2016 at around 3.7%-4% of gross loans and credit costs have started to fall in the first two quarters of 2017 after peaking at 4.8% of loans in the 4Q16. At the same time, loan loss reserves have continued to climb, reaching a substantial 156% of problem loans as of June 2017. The reduction in credit costs has supported a modest rebound in profitability in the first two quarters of 2017 to an annualized 0.8% of tangible assets. Earnings generation has also been supported by ongoing efforts to improve efficiency and by the bank's targeted lending to higher margin -- but higher risk - segments. The bank's tangible common equity to adjusted risk weighted assets, Moody's preferred capitalization metric, has risen to 9.1% from just 5.7% as of September 2015 due to a slowdown in loan growth and an increased focus on segments that consume less capital, even if they are higher risk in Moody's view. Nevertheless, this remains modest by both regional and global standards. BB has a low reliance on market funds given its substantial base of core deposit collected through its nationwide branch network and its access to stable funding from federal funds and judicial deposits. As a result, market funds are equal to just 14% of tangible assets. As BB's rating is constrained by Brazil's Ba2 sovereign rating, the bank's negative outlook is in line with the negative outlook on the sovereign. WHAT COULD CHANGE THE RATING UP OR DOWN BB's rating will likely be downgraded if Brazil's sovereign rating is lowered. In line with the negative outlook, the rating is does not face upward pressure at this time. However, the outlook could be stabilized if and when the sovereign outlook returns to stable. The last rating action on Banco do Brasil S.A. (Cayman) was on 31 May 2017. Banco do Brasil S.A, is headquartered in Brasilia, Brasil, and reported USD436.3 billion (BRL1,445 billion) in assets, as of June 2017. The principal methodology used in these ratings was Banks published in September 2017. BANCO NACIONAL: Unduly Paid 20% More for JBS Shares, Says Court --------------------------------------------------------------- Folha De S.Paulo reports that an audit of the Federal Accounting Court concluded that Brazil's national development bank, Banco Nacional de Desenvolvimento Economico e Social (BNDES), unduly paid 20% more for JBS shares in an operation to support the purchase of the National Beef Packing and the meatpacking division of Smithfield Foods, both in the United States. The report on the case, obtained by Folha, indicates "damage to the treasury" of at least R$303 million (US$95 million) in the deal, made in 2008, according to Folha De S.Paulo. The trial of the case was scheduled for Oct. 18, the report relays. According to the court's investigation, the bank had a loss of R$285.6 million (US$89 million) buying the stake in the company of the brothers Joesley and Wesley Batista, the report relays. In addition, it failed to obtain R$18.3 million (US$5.6 million) in dividends, as it could have bought a larger number of shares paying the "fair price", the report notes. Values are updated to July, the report discloses. The report was completed at the end of September and distributed on October 16 to the Federal Accounting Court's ministers, the report relays. The investigation proposes that the court hold Joesley Batista, former Finance minister Guido Mantega and businessman Victor Garcia Sandri, appointed as a friend of Mantega, liable to the alleged losses, the report notes. The auditors concluded, based on the JBS plea bargain deal, that Batista, Mantega, and Sandri were criminally associated to give the company advantages, the report adds. As reported in the Troubled Company Reporter-Latin America on June 28, 2017, Fitch Ratings has affirmed the Long-Term Foreign and Local Currency Issuer Default Ratings (IDRs) of Banco Nacional de Desenvolvimento Economico e Social (BNDES) at 'BB' and its long-term National rating at 'AA+(bra)'. The Outlooks of the Long- Term IDRs and National rating remain Negative. Fitch also affirmed BNDES's Support Rating (SR) at '3', Support Rating Floor (SRF) at 'BB' and long-term National rating at 'AA+(bra)'. COSAN LTD/SA: S&P Affirms 'BB' CCR, Outlook Remains Negative ------------------------------------------------------------ S&P Global Ratings affirmed its 'BB' corporate credit ratings on Cosan Ltd., Cosan S.A Industria e Comercio, and Cosan Lubrificantes e Especialidades S.A. The outlook on all companies remains negative. S&P said, "At the same time, we affirmed the 'BB' issue-level rating on the unsecured notes that Cosan S.A. guarantees with a recovery rating of '3', which reflects our expectation of meaningful recovery (rounded to 65%). We affirmed our 'BB' rating on CZZ's debt with a recovery rating of '4', which indicates an average recovery (rounded to 45%) in the event of a payment default." S&P said, "The rating affirmation and negative outlook reflect our expectation that CZZ and Cosan S.A. will maintain strong and resilient cash flow generation due to the solid business position of its subsidiaries; we also expect those subsidiaries (Comg†s and Ra°zen, in the case of Cosan S.A.) to show continuity in their strong results. Also, we expect that, after the recent capital increase of Brazilian real (R$)2.64 billion at Cosan Logistica's subsidiary (Rumo S.A.; BB-/Stable/B), it will be able to increase operating cash flow by executing its investment plan, improving operating efficiency while benefitting from a lighter capital structure. "The negative outlooks on CZZ, Cosan S.A., and Cosan Lubrificantes e Especialidades mirror that on Brazil, reflecting our view that there are significant uncertainties over the Cosan group's ability to service its financial obligations on a timely basis under a hypothetical sovereign default scenario. "Even though the group has maintained its liquidity position and improved its operating efficiency, we could downgrade CZZ, and consequently Cosan S.A., if we were to lower the ratings on Brazil. We could also lower the ratings on CZZ if it is unable to improve operating performance despite expected investments and growth in volumes, leading it to incur additional debt without an improvement in cash flow generation, and/or if dividends streamed to Ra°zen significantly decrease. That scenario would lead CZZ to post net debt to EBITDA higher than 5.0x and FFO to net debt below 12% on a consistent basis. "We could revise Cosan S.A.'s SACP to a weaker category if credit metrics deteriorate as a result of lower cash flow generation at its main subsidiary, Comg†s, leading to net debt to EBITDA higher than 4.0x and FFO to net debt lower than 20% in the next 12 months. In such a scenario, Comgas' EBITDA margin drops 5% and dividends from Ra°zen fall 50% from currently expected levels." DESENBAHIA: Moody's Withdraws Ba3 LT Local Issuer Ratings --------------------------------------------------------- Moody's America Latina Ltda. (MAL) has withdrawn all ratings assigned to DESENBAHIA -- Agencia de Fomento do Estado da Bahia (Desenbahia), including the long and short-term local issuer ratings of Ba3 and Not Prime, respectively; as well as the long and short-term Brazilian national scale issuer ratings of A2.br and BR-1, respectively. Moody's has also withdrawn the baseline credit assessment (BCA) of ba3 and the adjusted BCA of ba3. Before the withdrawal, the outlook on all ratings was stable. The following ratings were withdrawn: Issuer: DESENBAHIA -- Agencia de Fomento do Estado da Bahia -- Long-Term Global Local Currency Issuer Rating, previously rated Ba3, stable -- Short-Term Global Local Currency Issuer Rating, previously rated Not Prime -- Long-Term Brazilian National Scale Issuer Rating, previously rated A2.br -- Short-Term Brazilian National Scale Issuer Rating, previously rated BR-1 -- Baseline Credit Assessment, previously rated ba3 -- Adjusted Baseline Credit Assessment, previously rated ba3 -- Outlook, Changed To Rating Withdrawn From Stable RATINGS RATIONALE The last rating action on Desenbahia's ratings was on 17 March 2017, when Moody's affirmed the entity's local issuer ratings at Ba3 and Not Prime, for long and short-term, as well as the national scale issuer ratings of A2.br and BR-1, long- and short- term, respectively. The BCA and adjusted BCA were both affirmed at ba3, at the same level of the rating assigned to the state of Bahia, its shareholder. This action followed the affirmation of the ratings of State of Bahia. The outlook was changed to negative, from stable. DESENBAHIA -- Agencia de Fomento do Estado da Bahia is headquartered in Salvador, Bahia, and had total assets of BRL1,228.8 million ($370.9 million) and equity of BRL537.8 million ($162.3 million) as of June 30, 2017. Moody's has decided to withdraw the ratings for its own business reasons. MARFRIG GLOBAL: S&P Alters Outlook to Stable on Aggressive Growth ----------------------------------------------------------------- S&P Global Ratings revised its global scale rating outlook on Marfrig Global Foods S.A. (Marfrig) to stable from positive. S&P said, "At the same time, we affirmed our 'B+' global scale corporate credit and issue-level ratings on the company. We also lowered the national scale corporate credit rating to 'brA-' from 'brA' on Marfrig. The outlook on this rating is now stable. We maintain our recovery rating of '4' on Marfrig's senior unsecured debts, which indicates an average recovery expectation of 30%-50% (rounded 30%)." S&P said, "The outlook revision reflects our opinion that Marfrig's deleveraging will be delayed, while it faces execution risks associated with its more aggressive growth strategy since the second half of 2017. The latter consists of increasing slaughtering capacity by almost 70% through the reopening of five beef plants in Brazil. We forecast that this growth can result in a cash burn of R$550 million - R$600 million in 2017 due to intensive working capital requirements to ramp-up the plants." Therefore, the company will deviate from our previous expectations for deleveraging, and should maintain credit metrics in line with a highly leveraged financial risk profile, with debt to EBITDA close to 5x in 2017 and 4.0x-4.5x in 2018, funds from operations (FFO) to debt slightly below 12% in 2017 and around 15% in 2018, and a loss in FOCF this year and none in 2018. Nevertheless, the rating strengths are Marfrig's strong liquidity position, geographic and portfolio diversification--with footprint in Latin America, U.S., and Asia--and its protein diversification into poultry and beef. S&P said, "We view that Marfrig's strategy to increase market share in Brazil's market as risky, because it requires significant investments in working capital and an increase in cattle supply, which can pressure input costs. In addition, execution risks stem from the company's historically weaker profitability in the beef operations than those of peers such as Minerva S.A., which can be more pronounced amid weaker prices and greater competition. "Nevertheless, the sector's fundamentals remain overall positive, with receding cattle prices and increasing export volumes. In addition, the company has been posting increasing volumes in Asia through Keystone operations, because the business model and market niche of the latter generates more resilient margins than those of Marfrig's beef operation. We expect Keystone to maintain its leading position in food-service segment and to continue posting middle single-percentage growth over the next few years, while maintaining EBITDA margins of about 10%. Our base-case scenario excludes the potential IPO of Keystone in the U.S. due to the uncertainties of its occurrence, timing, and amount." TAKATA CORP: FCR Taps Greenberg Traurig as Special Counsel ---------------------------------------------------------- Roger Frankel, the Future Claimants' Representative appointed in the Chapter 11 cases of TK Holdings, Inc. and its affiliated debtors and debtors-in-possession, seeks permission from the U.S. Bankruptcy Court for the District of Delaware to retain Greenberg Traurig, LLP as his special counsel, nunc pro tunc to September 27, 2017. Greenberg Traurig will be called upon to assist the Future Claimants' Representative in executing his duties and responsibilities in the chapter 11 cases, including providing litigation and specialized services that the Future Claimants' Representative determines is necessary. Those services may also include, but are not limited to, providing transactional support and addressing settlement matters as requested by the Future Claimants' Representative. Greenberg Traurig's services will not be duplicative of the services provided by Frankel Wyron or Ashby & Geddes. The Future Claimants' Representative requests that Greenberg Traurig be compensated on an hourly basis and reimbursed for the actual, necessary expenses it incurs. Greenberg Traurig has agreed that, unless otherwise agreed to in writing, its hourly rates will not exceed $965 for partners. Greenberg Traurig's hourly rate of legal assistants ranges from $95 to $360. Matthew L. Hinker, shareholder at the law firm of Greenberg Traurig, LLP, attests that his firm, does not have or represent any interest adverse to the interests of the Future Claimants' Representative, the Future Claimants, the Debtors and their estates, or these chapter 11 cases and is a "disinterested person" as that term is defined in section 101(14) of the Bankruptcy Code. In accordance with Appendix B-Guidelines for Reviewing Applications for Compensation and Reimbursement of Expenses Filed under 11 U.S.C. Sec. 330 for Attorneys in Larger Chapter 11 Cases, Mr.Hinker disclosed that: -- Greenberg Traurig has agreed that its hourly rates will not exceed $965, unless otherwise agreed to in writing; -- none of the professionals included in the engagement vary their rate based on the geographic location of the bankruptcy case; -- the firm has not represented the Committee in the 12 months prepetition; and -- Greenberg Traurig and the Future Claimants' Representative expect to develop a budget and staffing plan for the period from September 27, 2017 through and including December 31, 2017. The Counsel can be reached through: Matthew L. Hinker, Esq. Greenberg Traurig, LLP The MetLife Building 200 Park Avenue New York, NY 10166 Tel: (212) 801-9200 Fax: (212) 801-6400 Email: hinkerm@gtlaw.com About Takata Corp Japan-based Takata Corporation (TYO:7312) -- http://www.takata.com/en/-- develops, manufactures and sells safety products for automobiles. The Company offers seatbelts, airbags, steering wheels, child seats and trim parts. Headquartered in Tokyo, Japan, Takata operates 56 plants in 20 countries with approximately 46,000 global employees worldwide. The Company has subsidiaries located in Japan, the United States, Brazil, Germany, Thailand, Philippines, Romania, Singapore, Korea, China and other countries. Takata Corp. filed for bankruptcy protection in Tokyo and the U.S., amid recall costs and lawsuits over its defective airbags. Takata and its Japanese subsidiaries commenced proceedings under the Civil Rehabilitation Act in Japan in the Tokyo District Court on June 25, 2017. Takata's main U.S. subsidiary TK Holdings Inc. and 11 of its U.S. and Mexican affiliates each filed voluntary petitions under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Lead Case No.17-11375) on June 25, 2017. Together with the bankruptcy filings, Takata announced it has reached a deal to sell all its global assets and operations to Key Safety Systems (KSS) for US$1.588 billion. Nagashima Ohno & Tsunematsu is Takata's counsel in the Japanese proceedings. Weil, Gotshal & Manges LLP and Richards, Layton & Finger, P.A., are serving as counsel in the U.S. cases. PricewaterhouseCoopers is serving as financial advisor, and Lazard is serving as investment banker to Takata. Ernst & Young LLP is tax advisor. Prime Clerk is the claims and noticing agent. Skadden, Arps, Slate, Meagher & Flom LLP is serving as legal counsel, KPMG is serving as financial advisor, Jefferies LLC is acting as lead financial advisor. UBS Investment Bank also provides financial advice to KSS. On June 28, 2017, TK Holdings, as the foreign representative of the Chapter 11 Debtors, obtained an order of the Ontario Superior Court of Justice (Commercial List) granting, among other things, a stay of proceedings against the Chapter 11 Debtors pursuant to Part IV of the Companies' Creditors Arrangement Act. The Canadian Court appointed FTI Consulting Canada Inc. as information officer. TK Holdings, as the foreign representative, is represented by McCarthy Tetrault LLP. The U.S. Trustee has appointed an Official Committee of Unsecured Trade Creditors and a separate Official Committee of Tort Claimants. The Official Committee of Unsecured Creditors has selected Christopher M. Samis, Esq., L. Katherine Good, Esq., and Kevin F. Shaw, Esq., at Whiteford, Taylor & Preston LLC, in Wilmington, Delaware; Dennis F. Dunne, Esq., Abhilash M. Raval, Esq., and Tyson Lomazow, Esq., at Milbank Tweed Hadley & McCloy LLP, in New York; and Andrew M. Leblanc, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in Washington, D.C., as its bankruptcy counsel. The Committee has also tapped Chuo Sogo Law Office PC as Japan counsel. The Official Committee of Tort Claimants selected Pachulski Stang Ziehl & Jones LLP as counsel. Gilbert LLP will evaluate of the insurance policies. Sakura Kyodo Law Offices will serve as special counsel. Roger Frankel, the legal representative for future personal injury claimants of TK Holdings Inc., et al., tapped Frankel Wyron LLP and Ashby & Geddes PA to serve as co-counsel. Takata Corporation ("TKJP") and affiliates Takata Kyushu Corporation and Takata Services Corporation commenced Chapter 15 cases (Bankr. D. Del. Case Nos. 17-11713 to 17-11715) on Aug. 9, 2017, to seek U.S. recognition of the civil rehabilitation proceedings in Japan. The Hon. Brendan Linehan Shannon oversees the Chapter 15 cases. Young, Conaway, Stargatt & Taylor, LLP, serves as Takata's counsel in the Chapter 15 cases. TAKATA CORP: Committee Taps Davies Ward as Canadian Counsel ----------------------------------------------------------- The Official Committee of Unsecured Creditors of TK Holdings, Inc., and its debtor-affiliates seeks permission from the U.S. Bankruptcy Court for the District of Delaware to retain Davies Ward Phillips & Vineberg LLP, effective as of August 8, 2017, as Canadian counsel. On June 28, 2017, TK Holdings, in its capacity as the foreign representative of the Debtors, obtained an order of the Ontario Superior Court of Justice, among other things, recognizing the Chapter 11 Cases as "foreign main proceedings" under the Companies' Creditors Arrangement Act, R.S.C., 1985, c. C-36, as amended, recognizing TK Holdings as the foreign representative of the Debtors and granting a stay of proceedings against the Debtors pursuant to Part IV of the CCAA. The services the Committee has requested from Davies are: (a) advise the Committee with respect to the CCAA Proceedings, including, but not limited to, issues that impact the Debtors' estates or otherwise affect the rights and privileges of the Debtors' unsecured creditors; (b) participate in in-person and telephonic meetings of the Committee and any subcommittees formed thereby, as applicable; (c) advise the Committee with respect to all filings and proposed filings in these Chapter 11 Cases, including any plan or reorganization, to the extent such filings implicate the CCAA Proceedings or Canadian law; (d) represent the Committee at all hearings and other proceedings before the Ontario Court and such other courts or tribunals, as appropriate, in connection with the CCAA Proceedings; (e) review and analyze all pleadings filed with the Ontario Court, and advising the Committee with respect to its position thereon and the filing of any response thereto; (f) assist the Committee in preparing pleadings and applications in connection with the CCAA Proceedings, and pursuing or participating in adversarial proceedings, contested matters and administrative proceedings as may be necessary or appropriate in furtherance of the Committee's interests and objectives in connection with the CCAA Proceedings; and (g) perform other legal services as may be necessary or as may be requested by the Committee in accordance with the Committee's powers and duties as set forth in the Bankruptcy Code or otherwise under the CCAA. The standard hourly rates charged by Davies are: Partners CAD$8603 to CAD$1,025 Associates & Senior Attorneys CAD$430 to CAD$620 Law Clerks CAD$180 to CAD$475 Articling Students CAD$295 Legal Assistants CAD$50 to CAD$120 Natasha MacParland, partner of Davies Ward Phillips & Vineberg LLP, attests that her firm does not have any connection with the Debtors, their known creditors, other known or potential parties in interest, their respective attorneys or accountants or other professionals, the U.S. Trustee or any person employed in such office of the U.S. Trustee, and does not represent any other entity having an adverse interest in connection with these Chapter 11 Cases or the CCAA Proceedings. In accordance with Appendix B-Guidelines for Reviewing Applications for Compensation and Reimbursement of Expenses Filed under 11 U.S.C. Sec. 330 for Attorneys in Larger Chapter 11 Cases, Ms. MacParland disclosed that: -- it has not agreed to any variations from, or alternatives to, its standard or customary billing arrangements for this engagement; -- none of the professionals included in the engagement vary their rate based on the geographic location of the bankruptcy case; -- the firm has not represented the Committee in the 12 months prepetition; and -- Davies has developed a prospective budget and staffing plan for the Committee's review and approval. The Firm can be reached through: Natasha MacParland Davies Ward Phillips & Vineberg LLP 155 Wellington Street West Toronto, ON, M5V Tel: 416-863-0900 Email: nmacparland@dwpv.com About Takata Corp Japan-based Takata Corporation (TYO:7312) -- http://www.takata.com/en/-- develops, manufactures and sells safety products for automobiles. The Company offers seatbelts, airbags, steering wheels, child seats and trim parts. Headquartered in Tokyo, Japan, Takata operates 56 plants in 20 countries with approximately 46,000 global employees worldwide. The Company has subsidiaries located in Japan, the United States, Brazil, Germany, Thailand, Philippines, Romania, Singapore, Korea, China and other countries. Takata Corp. filed for bankruptcy protection in Tokyo and the U.S., amid recall costs and lawsuits over its defective airbags. Takata and its Japanese subsidiaries commenced proceedings under the Civil Rehabilitation Act in Japan in the Tokyo District Court on June 25, 2017. Takata's main U.S. subsidiary TK Holdings Inc. and 11 of its U.S. and Mexican affiliates each filed voluntary petitions under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Lead Case No. 17-11375) on June 25, 2017. Together with the bankruptcy filings, Takata announced it has reached a deal to sell all its global assets and operations to Key Safety Systems (KSS) for US$1.588 billion. Nagashima Ohno & Tsunematsu is Takata's counsel in the Japanese proceedings. Weil, Gotshal & Manges LLP and Richards, Layton & Finger, P.A., are serving as counsel in the U.S. cases. PricewaterhouseCoopers is serving as financial advisor, and Lazard is serving as investment banker to Takata. Ernst & Young LLP is tax advisor. Prime Clerk is the claims and noticing agent. Skadden, Arps, Slate, Meagher & Flom LLP is serving as legal counsel, KPMG is serving as financial advisor, Jefferies LLC is acting as lead financial advisor. UBS Investment Bank also provides financial advice to KSS. On June 28, 2017, TK Holdings, as the foreign representative of the Chapter 11 Debtors, obtained an order of the Ontario Superior Court of Justice (Commercial List) granting, among other things, a stay of proceedings against the Chapter 11 Debtors pursuant to Part IV of the Companies' Creditors Arrangement Act. The Canadian Court appointed FTI Consulting Canada Inc. as information officer. TK Holdings, as the foreign representative, is represented by McCarthy Tetrault LLP. The U.S. Trustee has appointed an Official Committee of Unsecured Trade Creditors and a separate Official Committee of Tort Claimants. The Official Committee of Unsecured Creditors has selected Christopher M. Samis, Esq., L. Katherine Good, Esq., and Kevin F. Shaw, Esq., at Whiteford, Taylor & Preston LLC, in Wilmington, Delaware; Dennis F. Dunne, Esq., Abhilash M. Raval, Esq., and Tyson Lomazow, Esq., at Milbank Tweed Hadley & McCloy LLP, in New York; and Andrew M. Leblanc, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in Washington, D.C., as its bankruptcy counsel. The Committee has also tapped Chuo Sogo Law Office PC as Japan counsel. The Official Committee of Tort Claimants selected Pachulski Stang Ziehl & Jones LLP as counsel. Gilbert LLP will evaluate of the insurance policies. Sakura Kyodo Law Offices will serve as special counsel. Roger Frankel, the legal representative for future personal injury claimants of TK Holdings Inc., et al., tapped Frankel Wyron LLP and Ashby & Geddes PA to serve as co-counsel. Takata Corporation ("TKJP") and affiliates Takata Kyushu Corporation and Takata Services Corporation commenced Chapter 15 cases (Bankr. D. Del. Case Nos. 17-11713 to 17-11715) on Aug. 9, 2017, to seek U.S. recognition of the civil rehabilitation proceedings in Japan. The Hon. Brendan Linehan Shannon oversees the Chapter 15 cases. Young, Conaway, Stargatt & Taylor, LLP, serves as Takata's counsel in the Chapter 15 cases. =================== C O S T A R I C A =================== BANCO NACIONAL: Fitch to Rate CRC-Denominated Sr. Notes 'BB' ------------------------------------------------------------ Fitch Ratings has assigned an expected Long-Term rating of 'BB(EXP)emr' to Banco Nacional de Costa Rica's (BNCR) proposed CRC-denominated senior unsecured notes. The final rating is contingent upon the receipt of final documents conforming to information already received. The size, maturity and interest rate of the offering are not yet defined. The notes will be BNCR's direct, unconditional and unsecured general obligations and would represent a new international 144A/Reg S issuance. The net proceeds of these senior notes are expected to be used for general corporate purposes, including the repayment and/or refinancing BNCR's outstanding indebtedness. BNCR's ratings are not affected by the additional debt issuance. KEY RATING DRIVERS The 'BB(EXP)'emr rating reflects that these are senior unsecured obligations of BNCR that rank pari passu with other senior unsecured indebtedness, and therefore, this rating is aligned with the bank's Foreign Currency Issuer Default Ratings (FC IDR) of 'BB'/Stable Outlook. The notes are denominated in Costa Rican Colones (CRC), but the settlement amount paid to the investors will be denominated in USDs at the prevailing exchange rate. The subscript 'emr' was added to the rating of the local currency-linked issuance to reflect the embedded market risk of exchange rate fluctuations between the CRC and the USD given that the issuance will be denominated in CRCs while settlement will be in USDs. Fitch considers the bank's FC IDR as the appropriate anchor for this issue rating. Given that the settlement of the notes is in USDs, there is transfer and convertibility risk, which is addressed by the entity's FC IDR, regardless of the fact that the issuer is not bearing any material currency risk, since these notes will be denominated in CRCs. RATING SENSITIVITIES The rating assigned to the notes is sensitive to any change in BNCR's foreign currency IDR. Fitch currently rates BNCR as follows: -- Long-Term Foreign and Local Currency IDR 'BB'; Outlook Stable; -- Short-Term Foreign and Local Currency IDR 'B'; -- Support Rating '3'; -- Viability Rating 'bb'; -- Long-term National scale rating 'AA+(cri)'; Outlook Stable; -- Short-term National scale rating 'F1+(cri)'; -- Long-term National scale rating for local senior debt issuances 'AA+(cri)'. BANCO NACIONAL: Moody's Assigns Ba2 Rating to Global LT Sr. Debt ---------------------------------------------------------------- Moody's Investors Service has assigned a Ba2 foreign currency senior unsecured debt rating to Banco Nacional de Costa Rica (BNCR)'s proposed global senior debt issuance. The outlook on the rating is negative. The instrument will be denominated in Costa Rican colon (CRC). However, all amounts related to the issuance will be payable in US dollars at the then prevailing exchange rate. The bonds will be governed by the laws of the State of New York. The following rating was assigned to Banco Nacional de Costa Rica: Global long term senior unsecured debt rating: Ba2, negative outlook. RATINGS RATIONALE The Ba2 rating incorporates the bank's full government ownership, the government's guarantee of the bank's senior obligations per Article 4 of the Organic Law of the National Banking System, and BNCR's public mandate and importance as the country's largest bank. The rating is further supported by the bank's competitive advantage in terms of business generation and preferential access to relatively low cost, local currency funding in light of the government guarantee, and manageable problem loans. These credit strengths help to offset BNCR's weak core capitalization and modest profitability, owing to high operating costs and mandatory transfers to government related entities. Earnings will likely be further challenged by narrowing net interest margins and rising credit costs. However, though asset risks are rising given the increase in interest rates and the depreciation in the CRC, which may negatively affect the bank's sizeable share of foreign currency loans to local currency earners, as of June 2017 problem loans remained moderate at 2.1% of gross loans. Moody's has assigned a foreign currency debt rating to the bond because even though it is denominated in CRC, all related payments must be made in the equivalent amount of US dollars at the exchange rate prevailing before the date the payment is due. The amount of US dollars received by investors will hence fluctuate according to the exchange rate. BNCR has the responsibility of obtaining the US dollars to make coupon and principal payments and its inability to do so would trigger an event of default. Consequently, although the investor bears FX risk the bank bears convertibility risk. As Costa Rica's foreign currency bond ceiling is Baa3, however, convertibility risk does not constrain the rating. Moody's notes that the Ba2 debt rating is in line with the bank's local currency deposit rating. As the bank's debt rating is constrained by the sovereign, the negative outlook is in line with the negative outlook on Costa Rica's Ba2 government bond rating. WHAT COULD MOVE THE RATINGS UP OR DOWN Should Costa Rica's negative outlook result in a downgrade of the government bond rating, BNCR's deposit and debt ratings would likely be downgraded as well. Upward pressures on BNCR's ratings are limited given the negative outlook on the issuer and on the ratings of the Government of Costa Rica. However, the outlook on the bank's ratings could stabilize if the sovereign outlook stabilizes. The last rating action on Banco Nacional de Costa Rica was on 13 February 2017. The principal methodology used in this rating was Banks published in September 2017. =================================== D O M I N I C A N R E P U B L I C =================================== DOMINICAN REPUBLIC: Taiwan Angst Amid Playing Footsie With Beijing ------------------------------------------------------------------ Dominican Today reports that Taiwan Deputy Foreign Minister, Jose Maria Liu, is on his way to the Dominican Republic to consolidate bilateral ties with the country, amid talks of Santo Domingo's rapprochement to Beijing. Foreign Minister David Lee disclosed the trip and said Liu was traveling to the Caribbean island "right now," during questioning from the legislator Chiang Chi-chen, of the opposition Kuomintang Party, according to Dominican Today. The report notes that Mr. Chiang cited a meeting between Dominican Foreign Minister Miguel Vargas and China counterpart, Wang Yi, during the UN General Assembly in September, in which the Dominican Republic didn't speak in favor of Taiwan. Experts on the island say it was due to the Dominican Government's attempt to secure Beijing's support for its push for a non- permanent seat of the UN Security Council, the report relays. The Taiwanese diplomat said his Ministry closely follows "relations with the Dominican Republic" and noted that during his trip to the Caribbean country in July, Mr. Vargas didn't receive him because he was out of the country, so that fact "should not be interpreted with excesses," the report relays. Diplomatic sources in Taiwan told Efe that Taipei-Santo Domingo ties "are not in imminent danger" of rupture, but acknowledge that there have been numerous contacts between senior officials of the Dominican Republic and China in the last year, the report notes. During a further questioning in Parliament Mr. Lee called Chinese pressure on the island "constant" and that the loss of allies cannot be discarded, the report relays. "Taiwan must prepare to face the worst," he added. The Dominican Republic is the only country with a considerable economy which still holds diplomatic ties with Taipei, after Panama decided to cast its lot with Beijing in July, the report notes. Only 20 countries maintain diplomatic ties with Taiwan, the report adds. As reported in Troubled Company Reporter-Latin America on July 24, 2017, Moody's Investors Service has upgraded the Dominican Republic's long term issuer and debt ratings to Ba3 from B1 and changed the outlook to stable from positive, based on the following key drivers: (1) The Dominican Republic's continued robust growth outlook compared to rating peers, coupled with a reduction in external risks as current account deficits have declined and international reserves have increased. (2) The reduction in fiscal deficits over the last four years and Moody's expectation that fiscal deficits will remain shy of 3% of GDP, supported by fiscal restraint and reduced transfers to the electricity sector. ============= E C U A D O R ============= ECUADOR: Fitch Assigns 'B' Rating to $2.5-Bil. Notes Due 2027 ------------------------------------------------------------- Fitch Ratings has assigned a 'B' rating to Ecuador's $2.5 billion notes maturing Oct. 23, 2027. The notes have a coupon of 8.875%. Proceeds from this issuance will be used in accordance with local budget laws for government programs, investment projects or to refinance existing debt obligations on more favourable terms. KEY RATING DRIVERS The bond rating is in line with the Ecuador's Long-Term Foreign Currency Issuer Default Rating (IDR) of 'B'. RATING SENSITIVITIES The bond rating would be sensitive to any changes in Ecuador's Long-Term Foreign Currency IDR, which Fitch affirmed at 'B' on Aug. 24, 2017 with a revised Negative Outlook. ============= J A M A I C A ============= JAMAICA: Economy to Get US$20 Billion Boost ------------------------------------------- RJR News reports that Jamaica Finance Minister Audley Shaw says Jamaica will see an injection of more than US$20 billion worth of new investments that will help to drive the economy and increase job creation. Addressing an IMF/World Bank Small States Forum at the headquarters of the World Bank, Minister Shaw noted that this large investment is not a loan from the Bank or the IMF, but a direct investment in Jamaica from the private sector and overseas investors, according to RJR News. He pointed out that the Government is on a drive to move Jamaica forward by attracting large investments into the country, which is one engine to spur the economy, the report notes. As reported in the Troubled Company Reporter-Latin America on Sept. 28, 2017, on Sept. 25, 2017, S&P Global Ratings affirmed its 'B' long- and short-term foreign and local currency sovereign credit ratings on Jamaica. The outlook on the long-term rating remains stable. At the same time, S&P Global Ratings affirmed its 'B+' transfer and convertibility assessment on the country. ====================== P U E R T O R I C O ====================== BAILEY'S EXPRESS: Can Use Up to $114K in Cash Until Oct. 28 ----------------------------------------------------------- Ann M. Nevins of the U.S. Bankruptcy Court for the District of Connecticut has entered a fourth interim order authorizing Bailey's Express, Inc., to use up to $113,821 of cash collateral of Bankwell Bank until Oct. 28, 2017, at 5:00 p.m. The Debtor is authorized to use an amount of cash collateral until the termination date not to exceed $113,821 solely to fund the types and corresponding amounts of itemized expenditures contained in the budget. For each weekly period set forth in the Budget, the Debtor's actual cash disbursements for the period will not exceed the line item amount for category as set forth in the Budget, provided, however, that notwithstanding the foregoing, (i) expenditures of the Debtor under any line item of the Budget for any period may exceed the expenditure amount budgeted for the line item by 20%, so long as aggregate total expenditures during the term of this order do not exceed the total amount budgeted for the period, and (ii) any line item expenditures budgeted during any given week, but not actually paid or expended during the week, may be paid during the following week. In no event will aggregate total expenditures by the Debtor through the Termination Date exceed the Total Authorized Expenditure Amount, provided, however, that through the Termination Date, Bankwell, SAIA, and the Debtor may, in their sole discretion, agree to increase cash disbursements and operating expenditures in the Budget, and upon written agreement by Bankwell and SAIA to so modify the Budget, the Debtor will be authorized to use cash collateral in the amount without the need for any further order of the Court. It is understood that Bankwell and SAIA may assume that the Debtor will comply with this requirement and Bankwell and SAIA will have no duty to monitor compliance. As adequate protection for any cash collateral expended by the Debtor pursuant to this Order, Bankwell is granted a first lien to secure an amount of Bankwell's prepetition claims equal to (i) the amount of cash collateral actually expended by the Debtor and (ii) an amount equaling the aggregate decline in the value of the Bankwell prepetition collateral (whether as a result of physical deterioration, consumption, use, shrinkage, decline in market value or otherwise). The Replacement Liens will be subject only to non-avoidable, valid, enforceable and perfected liens and security interests in the assets of Debtor, as prepetition Debtor, that existed on the Petition Date and that are not subject to avoidance pursuant to the U.S. Bankruptcy Code, in favor of third parties, that are superior in priority, after giving effect to any existing subordination or intercreditor arrangements, to the Bankwell Prepetition Liens. The Replacement Liens will attach to personal property and assets of the Debtor, of any kind or nature whatsoever, whether now owned or hereafter acquired by any Debtor, and all proceeds, rents or profits thereof. Bankwell's Replacement Liens will at all times be senior to the rights of the Debtor and any successor trustee or estate representative in this case or any subsequent case or proceedings under the Bankruptcy Code. Any security interest or lien upon the DIP Collateral which is avoided or otherwise preserved for the benefit of any Debtor's estate under Section 551 or any other provision of the Bankruptcy Code will be subordinate to the security interests in and Replacement Liens upon the DIP Collateral granted to Bankwell. In addition to the Replacement Lien, Bankwell will have a priority claim in an amount equal to the amount of cash collateral actually expended by Debtor, which claim will have the highest administrative priority under Sections 503(b), 507(a)(1) and 507(b) of the Bankruptcy Code, and the claim will have priority over, and be senior to, all other administrative claims. As adequate protection for any cash collateral expended by the Debtor, SAIA is granted, pursuant to Sections 361(1) and 363(e) of the Bankruptcy Code, a lien, subordinate to the security interests held by Bankwell, on the DIP Collateral, but only to the extent that SAIA successfully establishes that SAIA is entitled to impose an interline trust on cash collected by the Debtor. If the Debtor at any time seeks any third-party financing, and in connection with financing requests that the Court grant or impose, under Section 364 of the Bankruptcy Code or otherwise, liens with a priority equal to or superior to the Bankwell Prepetition Liens or the Replacement Liens, the Debtor will be required to use the first available proceeds of any financing to repay Bankwell the full amount of any cash collateral expended pursuant to the court order. A copy of the Order is available at: http://bankrupt.com/misc/ctb17-31042-122.pdf About Bailey's Express Headquartered in Middletown, Connecticut, Bailey's Express -- http://www.baileysxpress.com/-- is a Connecticut-based less than truckload carrier. It provides service across the nation and is dedicated in helping Connecticut, Massachusetts and Rhode Island companies market their products throughout the U.S. including Hawaii and Alaska. It has distribution points in Charlotte, Dallas, Denver, Easton, Fontana, Indianapolis, Jacksonville, Memphis, Neenah, Phoenix, Salt Lake City and Toledo. It also provides service to Mexico, Puerto Rico & Canada. Bailey's Express filed for Chapter 11 bankruptcy protection (Bankr. D. Conn. Case No. 17-31042) on July 13, 2017, estimating its assets and liabilities at between $1 million and $10 million. The petition was signed by David Allen, chief financial officer. Judge Ann M. Nevins presides over the case. Elizabeth J. Austin, Esq., and Jessica Grossarth Kennedy, Esq., at Pullman & Comley, LLC, serves as the Debtor's bankruptcy counsel. No creditors' committee has yet been appointed in the case. PR GOLD BOND: Hires Luis D Flores Gonzalez Law as Legal Counsel --------------------------------------------------------------- PR Gold Bond Administration Services Inc. seeks authority from the U.S. Bankruptcy Court for the Puerto Rico to employ the Law Offices of Luis D. Flores Gonzalez as legal counsel. The Debtor says the services of Luis D. Flores Gonzalez will be necessary in connection with the filing of the Schedules, the Statement of Financial Affairs filed under Chapter 11, the payment plan that will be proposed, the examination of the claims filed, the Disclosure Statement and other matters. The Counsel's normal hourly billing rates are: Mr. Gonzalez $200.00 Certified Legal Assistants $60.00 Paraprofessionals $40.00 Mr. Gonzalez has received a retainer in this case in the amount of $5,000. Luis D. Flores Gonzalez attests that he is a disinterested party within the meaning of 11 U.S.C. 101(14). The Counsel can be reached through: Luis D. Flores Gonzalez, Esq. LAW OFFICES OF LUIS D. FLORES GONZALEZ Georgetti #80 Suite 202 Rio Piedras, PR 00925 Tel.787-758-3606 Email: ldfglaw@yahoo.com About PR Gold Bond Administration Services Based in Bayamon, Puerto Rico, PR Gold Bond Administration Services Inc filed a Chapter 11 petition (Bankr. D.P.R. Case No. 17-06052) on August 28, 2017. Luis D. Flores Gonzalez, Esq. at Luis DFlores Gonzalez Law Office represents the Debtor as legal counsel. At the time of filing, the Debtor estimated less than $50,000 in assets and $100,001 to $500,000 in liabilities. ================================ T R I N I D A D & T O B A G O ================================ CL FIN'L: CLICO Records a Sixth Profitable Year ----------------------------------------------- Anthony Wilson at Trinidad Express reports that Colonial Life Insurance Company (CLICO) declared an after-tax profit of $447.3 million for the year ended December 31, 2016, which is a 50-per cent decline from the $894.3 million the company declared in 2015, according to the insurer's financial statement on its website. The 2016 results were signed by former executive chair Wendy Ho Sing and Jacinta Sohun, head of finance, on June 13, 2017, according to Trinidad Express. As reported in the Troubled Company Reporter-Latin America on July 26, 2017, CL Financial Limited shareholders have vowed to pay back a TT$15 billion (US$2.2 billion) debt to the Trinidad Government after scoring what it called a "major legal victory" against the Keith Rowley administration. Caribbean360.com said the Trinidad Government went to the High Court with a petition to have the company liquidated. Finance Minister Colm Imbert had explained then that the move was in response to attempts by the company's shareholders to take control of the board. However, after a near seven-hour hearing, High Court Judge Kevin Ramcharan sided with the company shareholders, ruling that the action by the Government was premature. The TCR-LA, citing Trinidad Express, reported on Aug. 6, 2015, that the Constitution Reform Forum (CRF) has called on Finance Minister Larry Howai to refrain from embarking on an "unnecessary drain on the Treasury" by appealing the decision of a High Court judge, who ordered that the Minister fulfil a request by president of the Joint Consultative Council (JCC) Afra Raymond for financial details relating to the bailout of CL Financial Limited. The CRF issued a release stating that if the decision is appealed, not only will it be a waste of finance but such a course of action will also demonstrate a "lack of commitment by the Government to the spirit and intent of the Freedom of Information Act FOIA", under which the request was made, according to Trinidad Express. On July 7, 2014, Trinidad Express said that the Central Bank has placed the responsibility of voluntary separation package (VSEP) negotiations for workers at insurance giant Colonial Life Insurance Company Ltd. (CLICO) with the company's board, after which it will review accordingly, the bank said in a statement. The bank's statement follows protest action by CLICO workers, supported by their union, the Banking, Insurance and General Workers' Union (BIGWU), outside the Central Bank in Port of Spain, according to Trinidad Express. In a separate TCRLA report on June 26, 2014, Caribbean360.com said that the Trinidad and Tobago government has welcomed an Appeal Court ruling that the Attorney General Anand Ramlogan said saves the country from paying out more than TT$1 billion (TT$1 = US$0.16 cents) to policyholders of the cash-strapped CLICO. The Appeal Court overturned the ruling of a High Court that ruled members of the United Policyholders Group (UPG) were entitled to be paid the full sums of their polices. CLICO financially caved in on itself at the end of 2008 after the investment instruments of major policyholders matured and they wanted hundreds of millions of dollars they were owed. On Aug. 6, 2013, the TCR-LA, citing Caribbean360.com, said that over TT$8 billion worth of CLICO's profitable business will be transferred to Atruis, a new company that will be owned by the state. The Trinidad Express said that the Cabinet approved the transfer as the Finance and General Purposes Committee continues to discuss a letter of intent hammered out by the Ministry of Finance and CL Financial's 400 shareholders, which envisions taxpayers will recover the more than TT$20 billion Government has injected since 2009 to keep CL subsidiary CLICO and other companies afloat. At its annual general meeting in Sept. 2013, CL Financial shareholders voted to extend the agreement with Government until August 25, 2014, while Cabinet decides on a new framework accord to recover the debt owed to Government through divestment of CL subsidiaries, including Methanol Holdings, Republic Bank, Angostura Holdings, CL World Brands and Home Construction Ltd., Caribbean360.com related. Proceeds from the divestment of these assets will go toward Government's recovery of the billions it pumped into CLICO. TCRLA reported on Sep 22, 2011, Caribbean News Now, citing Reuters, said that the cost of the Trinidad and Tobago government bailout of CL Financial Limited is likely to rise to more than TT$3 billion. ============= U R U G U A Y ============= ADMINISTRACION NACIONAL: Moody's Ups CFR to Ba2; Outlook Stable --------------------------------------------------------------- Moody's Investors Service upgraded the Corporate Family Rating on Administracion Nacional de Combustibles, Alcohol y Portland (ANCAP) to Ba2 from B1. Moody's also raise the company's Baseline Credit Assessment (BCA) to b3 from caa1. The rating action reflects ANCAP's lower debt burden, higher interest coverage, improved cash generation and high level of government support. The outlook on the ratings is stable. RATINGS RATIONALE The raising of ANCAP's BCA (a measure of the issuer's intrinsic risk regardless of its controlling entity) to b3 from caa1 reflects the company's lower debt burden after the USD622 million debt capitalization in 2016 coupled with better operating margin and interest coverage in the last 18 months. As of June 2017, ANCAP's consolidated debt leverage reached 2.6 times adjusted debt/EBITDA, down from close to 12 times in December 2015. In turn, consolidated adjusted EBITDA reached 16.9% in June 2017 from 7% in 2015. The company's operating performance improved on the back of increasing efficiencies and expense reductions and the government's permission for ANCAP to adjust fuel prices to assure a minimum level of profitability. For instance, the company increased fuel prices by 8% in 2016 and reduced gasoil prices by 8% so far in 2017. Because Uruguay does not have production of crude oil, the company depends 100% on oil imports. In the past, the government of Uruguay had prevented ANCAP from fully passing on cost increases, including higher crude prices and local currency devaluation, to final prices, which caused operating losses and rising debt. However, more recently, the government has publicly stated its intention to support a better financial profile for ANCAP. Nevertheless, because the government does not follow a clear, specific formula for fuel price adjustments, it remains unclear if ANCAP will be able to reduce earnings uncertainty. In addition, further cost cuts may be difficult to achieve by a company with limited cash to invest in equipment or technology upgrades and a powerful workforce. ANCAP's b3 BCA is supported by its monopoly position in refining and dominant position in wholesale marketing in Uruguay. However, the BCA also considers the company's small size, particularly in the context of its exposure to volatile and cyclical commodity prices, dependence on crude oil imports, as well as its reliance on a single refinery. In addition, ANCAP's small crude distillation capacity of 50,000 bpd at a single complex (La Teja) and its average 75% utilization rate raise concentration and operating risk issues. Since ANCAP is 100% owned by the Uruguayan government, it is considered a government related issuer (GRI) under Moody's methodology for such entities. ANCAP's Ba2 Corporate Family Rating is based on its BCA of b3, moderate dependence, reflecting the moderate degree of correlation between factors that could lead to financial stress on ANCAP and the government at the same time, and a high probability of extraordinary support from the government. The government's willingness to support the company is based on its 100% ownership of ANCAP's, the company's monopoly status for refining activities in Uruguay, and its strategic importance to Uruguay's economy and national security. In addition, the government's ability to provide support to ANCAP is measured by its Baa2 local currency rating with a stable outlook. The high support assumption embedded in ANCAP's Ba2 ratings has been evidenced since 2013, when the government granted a USD500 million equivalent loan to the company, which at the time replaced half of ANCAP's total outstanding debt to third parties. In addition and most importantly, in early 2016 the government capitalized the equivalent of USD622 million in debt to ANCAP's equity, reducing its debt by 43% from 2015 levels. ANCAP's liquidity is adequate. Cash balance as of June 2017 of UYU 5,620 million plus expected cash flow from operations in the next 12 months of about UYU 6,500 million should be more than enough to cover the company's basic needs including capital investments and debt repayment of a total of UYU 5,921 million in the next 18 months. But ANCAP remains subject to the volatility of commodities' prices. In addition, the company does not have committed credit facilities, although as a government owned entity it has ample access to local and international bank financing in Uruguay. Foreign exchange risk is high for ANCAP since imports are 100% U.S. dollar-denominated and 95% of its debt is in U.S. dollars. However, foreign currency devaluation risk is limited now for Uruguay given lower inflation rate in the 6-7% range and the potential 3% GDP growth in 2017-18. The stable rating outlook reflects the Moody's expectation that ANCAP will be able to sustain current operating and credit metrics over the short to medium term given the government's stated commitment to allow the company to pass through cost increases, a more disciplined operating and financial management, and lower inflation rates in Uruguay, which will somewhat offset volatile crude prices and management's limited ability to set fuel prices at its will. ANCAP's ratings could be upgraded if the company not only maintains debt leverage at current levels but also strengthens its liquidity position further to the point to protect its credit quality from earnings volatility. An upgrade of Uruguay's ratings could also add upward rating pressure on ANCAP's Corporate Family Rating. Conversely, if the company's EBITDA loses traction and debt leverage increases with limited prospects of a quick reversal, its ratings could be downgraded. The methodologies used in these ratings were Refining and Marketing Industry published in November 2016, and Government- Related Issuer published in August 2017. ANCAP, fully owned by the government of Uruguay, has a monopoly position in refining and fuel wholesale marketing within the country. ANCAP owns Uruguay's only refinery (La Teja), with a Nelson complexity rating of 8 and a crude distillation capacity of 50,000 barrels per day. ANCAP is the largest company in Uruguay, with revenues and total assets of USD1.99 billion and USD1.97 billion, respectively, in June 2017. The company also has a cement company, among other smaller businesses, which in aggregate represented 14.8% and 19.4% of consolidated adjusted revenues in EBITDA in 2016, respectively. *********** 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, 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 Joseph Cardillo at 856-381-8268. * * * End of Transmission * * *