/raid1/www/Hosts/bankrupt/TCRLA_Public/180530.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
L A T I N A M E R I C A
Wednesday, May 30, 2018, Vol. 19, No. 106
Headlines
B A H A M A S
BAHAMAS: Removed From Tax Haven Blacklist
B R A Z I L
BRAZIL: Truckers Strike to Cost Gov't $2.6BB Through End of Year
CIMENTO TUPI: S&P Withdraws 'D' Corporate Credit Rating
SANEPAR: Moody's Rates BRL250MM Sr. Unsec. Debentures 'Ba2'
TRANSMISSORA ALIANCA: S&P Affirms 'BB-' CCR, Outlook Stable
C A Y M A N I S L A N D S
GALAXY XXIX: Moody's Assigns Ba3 Rating to Class E Notes
C O L O M B I A
COLOMBIA TELECOM: S&P Affirms 'BB+' Corporate Credit Rating
D O M I N I C A N R E P U B L I C
* DOMINICAN REPUBLIC: Economic Activity Jumps 7.5% in April
P A R A G U A Y
PARAGUAY: President Leaves Post Early to Take Seat in Senate
P U E R T O R I C O
LRJ GLOBAL: Banco Desarollo to Get $2,493 Monthly Over 20 Years
S DIAMOND STEEL: June 19 Disclosure Statement Hearing
SPANISH BROADCASTING: Reports Preliminary Results for Q1 2018
SPANISH BROADCASTING: Swings to $19.6 Million Net Income in 2017
TOYS R US: U.S. Trustee Forms 5-Member Panel for Propco I Debtors
TOYS R US: MGA CEO Larian Drops Bid to Buy Stores
TOYS R US: Bank Debt Trades at 18.33% Off
T R I N I D A D & T O B A G O
TRINIDAD & TOBAGO: Tax Bill Should Make Country Compliant
U R U G U A Y
NAVIOS SOUTH: S&P Raises Corp Credit Rating to 'B', Outlook Stable
- - - - -
=============
B A H A M A S
=============
BAHAMAS: Removed From Tax Haven Blacklist
-----------------------------------------
RJR News reports that the Council of the European Union (EU)
disclosed the removal of The Bahamas and St. Kitts and Nevis from
the EU's list of non-cooperative tax jurisdictions.
The Council said both countries have made commitments at a high
political level to remedy EU concerns and that EU experts have
assessed those commitments, according to RJR News.
The EU's list -- established in December 2017, contributes to on-
going efforts to prevent tax fraud and promote good governance
worldwide, the report notes.
===========
B R A Z I L
===========
BRAZIL: Truckers Strike to Cost Gov't $2.6BB Through End of Year
-----------------------------------------------------------------
By Luciana Magalhaes and Paulo Trevisani at The Wall Street
Journal report that Brazil's government said that concessions to
end a crippling truckers strike will have a high cost for
taxpayers even as the country's businesses and consumers struggle
with shortages of fuel, food, medicines and other vital goods.
The government said it will cut taxes on diesel fuel, freeze the
price 60 days and let them change once every month afterward, and
compensate state-controlled oil company Petroleo Brasileiro SA, or
Petrobras, and its private-sector competitors, among other
concessions, according to The Wall Street Journal.
Shares of Petrobras took a hit Monday, May 28, plunging 15% to
BRL16.91, the report notes. According to Factset data, the oil
giant has lost nearly $45 billion in market value since its recent
peak on May 16, and around $28 billion since the strike began, the
report relays.
The measures will cost about BRL9.5 billion ($2.6 billion) through
the end of the year, Finance Minister Eduardo Guardia said at a
news conference, the report relays. Part of that bill will be
covered by using a government contingency fund and by erasing
payroll-tax cuts enjoyed by some industries, but other, as-yet
undisclosed, measures will also be required, Mr. Guardia said, the
report notes.
"The loss of tax revenue will need to be compensated," he said,
the report says.
Truckers began blockading highways, forcing factories to close and
hitting the country's important agricultural sector, the report
recounts. Farmer groups say millions of chickens have already
died because feed isn't being delivered, and tons of milk have
been discarded because of lack of storage, the report notes.
Police and the military have had to escort tanker trucks
delivering fuel to filling stations and other suppliers to ensure
that essential services, such as public transportation and garbage
collection, can continue, the report discloses.
President Michel Temer disclosed a new set of concessions after
measures disclosed May 24, failed to placate truckers, the report
relays. The disclosure followed hours of meetings with union
leaders, who then asked union members to end the blockades, the
report relays.
But by May 28 afternoon, there were still 557 blockades around the
country, according to Mr. Temer's chief of staff, Eliseu Padilha,
who in a televised press conference said a return to normal
conditions was taking longer than expected, the report notes.
Industry groups have estimated losses to the economy surpassing
BRL10 billion, the report relays. Economists are also reviewing
their estimates for the country's growth and the budget deficit,
the report notes.
The strike "will make the economy grow slower than we had
forecast, and it will shake confidence and encourage other groups
who want to extract income from the government," said Armando
Castelar, an economist and Ibre think tank in Rio, the report
says.
The Petrobras employees' union has threatened a 72-hour stoppage,
and has asked for the resignation of Chief Executive Officer Pedro
Parente, along with other demands, the report discloses. Markets
have supported Mr. Parente's policy of passing through global oil-
price fluctuations to the pump in a daily basis, a method that
wound up irking consumers used to more stable retail prices, the
report relays.
Petrobras is already in talks with workers to try to avert the
strike, and the company has no intention of replacing Mr. Parente,
Mr. Padilha said, the report notes.
CIMENTO TUPI: S&P Withdraws 'D' Corporate Credit Rating
-------------------------------------------------------
S&P Global Ratings withdrew its 'D' global and national scale
corporate credit ratings on Cimento Tupi S.A. S&P also withdrew
its 'D' issue-level rating on the company's senior unsecured
notes.
S&P said, "After the company's June 10, 2015, announcement of
missing interest payment on its 2018 notes, we downgraded the
company to 'D'. We're withdrawing today the ratings on Cimento
Tupi because its hasn't emerged from default, and we don't
envision that happening in the short term."
SANEPAR: Moody's Rates BRL250MM Sr. Unsec. Debentures 'Ba2'
-----------------------------------------------------------
Moody's America Latina Ltda. has assigned a Ba2 global scale
rating and a Aa2.br national scale rating to the senior unsecured
debentures due in 2021 and 2023 totaling BRL250 million, to be
issued by Companhia de Saneamento do Parana -- SANEPAR ("Sanepar"
or "the company"). Proceeds from the issuance will be used to fund
capital expenditures and working capital needs. Sanepar's
Ba2/Aa2.br corporate family ratings (CFR) are unaffected. The
outlook for the ratings is stable.
The assigned ratings are based on preliminary documentation
received by Moody's as of the rating assignment date. Moody's does
not expect changes to the documentation reviewed over this period
nor does it anticipate changes in the main conditions that the
debentures will carry. Should issuance conditions and/or final
documentation of the debentures deviate from the original ones
submitted and reviewed by the rating agency, Moody's will assess
the impact that these differences may have on the ratings and act
accordingly.
RATINGS RATIONALE
The Ba2/Aa2.br ratings for the proposed BRL 250 million debentures
due 2021-23 reflects (i) Sanepar's well positioned concession
area, with long-term concession contracts providing more
visibility over cash flow generation in the long-run; (ii)
Sanepar's strong and resilient credit metrics, with FFO/Net debt
and FFO Interest coverage expected to be above 40% and 5.0x,
respectively supported by the application of annual tariff
increases as part of the 2017 tariff review process ; and (iii)
its adequate liquidity position and the good access to debt market
to fund its large capital expenditure program, especially with CEF
and BNDES lines which have long tenor and competitive interest
costs
The assigned ratings also take into consideration (i) Sanepar's
large capital expenditure program which is expected to absorb a
large portion of the company's operating cash flow in the coming
years, (ii) relatively high dividend payouts historically when
compared to national peers, and (iii) risk of political
intervention as future operating performance will rely on the
effective application of a postponed portion of the 2017 tariff
increase on an annual basis over the next 6 years. The stable
outlook reflects the stable outlook on Brazil's government bond
rating and Moody's view that Sanepar's creditworthiness is highly
dependent on the credit quality of the sovereign.
The proposed debentures will be senior unsecured debt obligations
of Sanepar. They will include standard debt acceleration clauses
among which the non-payment by the company of any financial
obligation above BRL 30 million, a change of the company's control
by the state of Parana, and inability to comply, for two
consecutive quarters or two quarters within any four quarter
period, with financial covenants consisting of Net Debt to EBITDA
and EBITDA to Net Financial Expenses ratios set at 3.0x and 1.5x
respectively.
Despite their unsecured nature, the ratings of the proposed
debentures are in line with Sanepar's CFR reflecting Moody's view
that the pledges attached to the secured portion of the company's
debt obligations do not bring sufficient benefit to their
creditors relative to other debt instruments within the company's
capital structure. Some of Sanepar's debt is backed by reserve
accounts which are small in size (3 months) or secured against
future receivables the execution of which is dependent on the
company's ability to operate as a going concern basis. Cross
default mechanism also aligns probability of default across all of
the company's debt instruments.
Sanepar's operating performance has shown continuing growth over
the recent quarters, mainly driven by the 8.53% tariff adjustment
applied from June 2017, and to a certain extent by increases in
the number of connections for water and sewage services. After
growing 11% and 18% respectively in 2017, revenue and EBITDA grew
by another 8% and 24% in Q1 2018, despite a 4.5% year on year
decline in water consumption as a result of atypically high volume
of rain and lower temperatures in the concession area during the
quarter. Going forward Moody's expect that Sanepar will continue
to improve its operating performance, driven by (i) the expansion
of its sewage network, (ii) the company's continuing focus on
cost-saving measures, and (iii) the positive impact of the tariff
revision announced by the regulator in February 2017.
Moody's considers Sanepar's liquidity as adequate. As of March 31,
2018, the company had around BRL 549 million available in cash,
compared with BRL 570 million of debt maturities over the next
twelve months. The company also has a long dated maturity profile,
with 53% of debt maturing beyond 5 years, and good track record in
accessing debt markets on a timely basis.
What Could change the rating Up/Down
An upgrade of Brazil's sovereign bond rating, together with the
consistent application of a transparent and predictable regulatory
framework, and sustained improvements in Sanepar's credit metrics,
such that FFO interest coverage and FFO/net debt remain above 6.0x
and 45%, respectively, could lead to an upgrade of the ratings.
On the other hand, a downgrade of the ratings could result from
Moody's perception of a material change in the regulatory
framework under which Sanepar operates or a disruptive political
interference in the normal course of its business. A sustained
deterioration in the company's credit metrics, such that FFO/net
debt declines below 35% and FFO interest coverage moves toward
4.0x, or a deterioration in Brazil's sovereign credit quality
could also lead to a downgrade.
Headquartered in Curitiba in the State of Parana (Ba2/Aa2.br
stable), Brazil, Sanepar was founded in 1963. As of March 31,
2018, Sanepar had more than 3.1 million water connections and more
than two million sewage connections to provide treatment and
distribution of water to more than 10 million consumers and sewage
services to 346 municipalities. Of these municipalities, 345 are
in the state of Parana, representing around 86% of the state's
total municipalities, and one municipality in the state of Santa
Catarina.
Sanepar is controlled by the State of Parana, which owns 60.1% of
the company's voting shares, and the remaining portion is in free
float. The company also has preferred shares that are spread out
among the Government of Singapore (Aaa stable) (3.4%), Bank of
Nova Scotia (A1 negative) (2.7%), SPX Falcon (2.0%),
municipalities (0.7%) and other holders of listed shares (91.2%).
In the twelve months ended March 31, 2018, Sanepar reported net
sales of BRL3.9 billion and a net profit of BRL713 million.
The methodologies used in these ratings were Regulated Water
Utilities published in December 2015, and Government-Related
Issuers published in August 2017.
TRANSMISSORA ALIANCA: S&P Affirms 'BB-' CCR, Outlook Stable
-----------------------------------------------------------
S&P Global Ratings affirmed its 'BB-' global scale and 'brAA-/brA-
1+' Brazil national scale corporate credit ratings on Transmissora
Alianca de Energia Eletrica S.A. (Taesa). The outlook remains
stable. The company's 'bbb-' stand-alone credit profile (SACP)
remains unchanged.
At the same time, S&P also affirmed the 'brAA-' issue-level rating
on Taesa's third debenture issuance of R$2.2 billion in three
series due 2024.
The rating affirmation on Taesa incorporates a rating cap as a
result of the ratings on the Federative Republic of Brazil
(Brazil: BB-/Stable/B foreign and local currency global scale
ratings; brAA-/Stable/-- Brazil national scale rating). S&P said,
"In our view, Taesa has an appreciable likelihood of strife in a
sovereign default scenario, given the regulated nature of its
business. We believe that, in this scenario, Taesa could
ultimately be subject to tariff controls, negatively affecting the
company's revenue collections and access to credit."
The stable outlook on Taesa reflects that on the sovereign rating
of Brazil.
==========================
C A Y M A N I S L A N D S
==========================
GALAXY XXIX: Moody's Assigns Ba3 Rating to Class E Notes
--------------------------------------------------------
Moody's Investors Service has assigned ratings to five classes of
notes issued by Galaxy XXIX CLO, Ltd.
Moody's rating action is as follows:
US$$320,000,000 Class A Senior Floating Rate Notes due 2026,
Assigned Aaa (sf)
US$$58,000,000 Class B Senior Floating Rate Notes due 2026,
Assigned Aa1 (sf)
US$$32,000,000 Class C Deferrable Mezzanine Floating Rate Notes
due 2026, Assigned A2 (sf)
US$$27,000,000 Class D Deferrable Mezzanine Floating Rate Notes
due 2026, Assigned Baa3 (sf)
US$$27,500,000 Class E Deferrable Junior Floating Rate Notes due
2026, Assigned Ba3 (sf)
RATINGS RATIONALE
Moody's ratings of the Rated Notes address the expected losses
posed to noteholders. The ratings reflect the risks due to
defaults on the underlying portfolio of assets, the transaction's
legal structure, and the characteristics of the underlying assets.
Galaxy XXIX is a managed cash flow CLO. The issued notes will be
collateralized primarily by broadly syndicated senior secured
corporate loans. At least 90% of the portfolio must consist of
first lien senior secured loans and eligible investments, and up
to 10% of the portfolio may consist of second lien loans, first
lien last-out loans, and unsecured loans. The portfolio is 99
percent ramped as of the closing date.
PineBridge Investments LLC will direct the selection, acquisition
and disposition of the assets on behalf of the Issuer and may
engage in trading activity, including discretionary trading, up to
15 November 2018. Thereafter, the Manager may reinvest unscheduled
principal payments and proceeds from sales of credit risk assets,
subject to certain restrictions.
The transaction incorporates interest and par coverage tests
which, if triggered, divert interest and principal proceeds to pay
down the notes in order of seniority.
Methodology Underlying the Rating Action:
The principal methodology used in these ratings was "Moody's
Global Approach to Rating Collateralized Loan Obligations"
published in August 2017.
Factors that would lead to an upgrade or downgrade of the ratings:
The performance of the Rated Notes is subject to uncertainty. The
performance of the Rated Notes is sensitive to the performance of
the underlying portfolio, which in turn depends on economic and
credit conditions that may change. The Manager's investment
decisions and management of the transaction will also affect the
performance of the Rated Notes.
Loss and Cash Flow Analysis:
Moody's modeled the transaction using a cash flow model based on
the Binomial Expansion Technique, as described in Section 2.3.2.1
of the "Moody's Global Approach to Rating Collateralized Loan
Obligations" rating methodology published in August 2017.
For modeling purposes, Moody's used the following base-case
assumptions:
Par amount: $498,618,980
Diversity Score: 79
Weighted Average Rating Factor (WARF): 3133
Weighted Average Spread (WAS): 3.19%
Weighted Average Recovery Rate (WARR): 49.86%
Weighted Average Life (WAL): 5.22 years
Stress Scenarios:
Together with the set of modeling assumptions above, Moody's
conducted an additional sensitivity analysis, which was a
component in determining the ratings assigned to the Rated Notes.
This sensitivity analysis includes increased default probability
relative to the base case.
Here is a summary of the impact of an increase in default
probability (expressed in terms of WARF level) on the Rated Notes
(shown in terms of the number of notch difference versus the
current model output, whereby a negative difference corresponds to
higher expected losses), assuming that all other factors are held
equal:
Percentage Change in WARF -- increase of 15% (from 3133 to 3603)
Rating Impact in Rating Notches
Class A Senior Floating Rate Notes: 0
Class B Senior Floating Rate Notes: -1
Class C Deferrable Mezzanine Floating Rate Notes: -2
Class D Deferrable Mezzanine Floating Rate Notes:-1
Class E Deferrable Junior Floating Rate Notes:-1
Percentage Change in WARF -- increase of 30% (from 3133 to 4073)
Rating Impact in Rating Notches
Class A Senior Floating Rate Notes: 0
Class B Senior Floating Rate Notes: -3
Class C Deferrable Mezzanine Floating Rate Notes: -3
Class D Deferrable Mezzanine Floating Rate Notes: -2
Class E Deferrable Junior Floating Rate Notes:-1
===============
C O L O M B I A
===============
COLOMBIA TELECOM: S&P Affirms 'BB+' Corporate Credit Rating
-----------------------------------------------------------
S&P Global Ratings affirmed its corporate credit and senior
unsecured note ratings on Colombia Telecomunicaciones S.A. E.S.P.
(Coltel) at 'BB+'. S&P also raised its issue-level rating on the
company's hybrid capital securities to 'BB-' from 'B+'.
The rating action is based on Coltel's sustained operating
performance, which will allow the company to consolidate its
position as the second-largest player in Colombia's wireless and
fixed line markets. Ratings reflect the company's improved fixed-
line and broadband position after incorporating Metrotel and
Telebucaramanga into its portfolio, which will help increase the
company's market shares in those segments to 23.2% and 19.5%,
respectively, from 18.2% and 15.5%. In S&P's opinion, these
factors should enable Coltel to increase its available cash, which
S&P expects will help the company to continue deleveraging in the
next 12-18 months.
S&P said, "We previously rated Coltel's hybrid capital securities
at 'B+', reflecting a one-notch differential for contractual
subordination and an additional one-notch deduction for payment
flexibility to reflect the optional nature of the deferral
interest. According to our updated "Reflecting Subordination Risk
In Corporate Issue Ratings" criteria published on Sept. 21, 2017,
we now only deduct one notch for subordination in non-ranked
jurisdictions, such as Colombia. However, we continue to
incorporate a one-notch deduction due to optional interest
deferral. Consequently, we now rate Coltel's hybrid notes at 'BB-
'."
===================================
D O M I N I C A N R E P U B L I C
===================================
* DOMINICAN REPUBLIC: Economic Activity Jumps 7.5% in April
-----------------------------------------------------------
Dominican Today reports that Dominican Republic's Central Bank
reported that the monthly economic activity indicator (IMAE)
posted a 7.5% growth in April compared to the same month a year
ago.
It said the increase was mainly from the growth in Construction
(33.7%), Free Trade Zones (14.7%), Financial Services (10.1%),
Retail (9.1%), Health (9.0%), Transportation and Storage (8.8%),
Local Manufacturing (7.1%), among others, according to Dominican
Today.
"It should be noted that the exploitation of mines and quarries is
the only activity that presents a negative change in the month of
April (-32.0%) in its real added value, which is essentially
explained by maintenance processes of machinery and equipment in
the plants of production," the Central Bank said in an emailed
statement obtained by the news agency.
It said result takes the economy's accumulated growth to 6.7%,
after having experienced an inter-annual variation of 6.4% in the
January-March quarter, "which reflects the continuation of the
momentum of the monetary easing measures adopted as of the month
August, 2017," it said, the report relays.
The Central Bank says the performance ranks the Dominican economy
among the leader of the Latin American region in terms of 2018
economic growth, the report notes. "In terms of trend-cycle, the
IMAE shows an annualized expansion of 6.6% at the end of April,
which reflects that the economy continues to show growth above its
potential," the report adds.
===============
P A R A G U A Y
===============
PARAGUAY: President Leaves Post Early to Take Seat in Senate
------------------------------------------------------------
Pedro Servin at The Associated Press reports that Horacio Cartes
resigned from the presidency of Paraguay -- a long-expected step
that paves the way for him to take a Senate seat.
The recently approved Vice President Alicia Pucheta will take over
as leader, according to The Associated Press. The Senate now must
vote on whether to accept the resignation, but approval seems
likely, the report relays.
The report relays that Mr. Cartes' five-year term ends in August
and Paraguay's constitution says former presidents automatically
become senators for life, with a voice but without a vote.
But Mr. Cartes, 61, won a full Senate seat during last month's
elections, a post that would help him extend his political
influence into the future, and the Supreme Court ruled that it was
constitutional, the report notes. He has to resign before his
term ends so that he can be sworn in as senator for the coming
sessions, the report relays.
President-elect Mario Abdo Benitez, who is also a member of
Paraguay's ruling Colorado Party, takes office on August 15, the
report says.
Former presidential candidate Efrain Alegre of the opposition
Authentic Radical Liberal Party argued that Mr. Cartes' position
as a voting senator is illegal since all "ex-presidents turn into
senators for life under the constitution," a largely symbolic post
that doesn't carry a right to a vote, salary or immunity from
prosecution, the report says.
Before becoming president, Mr. Cartes added to a family fortune
with two dozen companies that dominate industries from banking to
tobacco to soft drinks to soccer, making it difficult to make a
move as president without generating complaints of conflicts of
interest, the report discloses.
The report relays that Mr. Cartes often faced -- and denied --
accusations that his wealth was fed by money laundering, cigarette
smuggling and drug trafficking. But Paraguayan voters overlooked
the allegations, focusing on hopes that the Mr. Cartes would help
boost the economy of one of South America's most unequal nations,
the report notes.
Paraguayan authorizes recently issued an arrest warrant for a man
Mr. Cartes has described as his "soul brother" as part of a
sweeping investigation into corruption in Latin America, the
report relays.
A financial crimes prosecutor has accused the president's friend,
Dario Messer, of money laundering and criminal association, the
report says. The dual Brazilian-Paraguayan citizen has been on
the run since Brazilian authorities issued an arrest warrant
there, the report relays. Brazilian authorities allege Messer is
the leader of a group of Brazilian illicit money dealers who
delivered bribes as part of the "Car Wash" kickback scheme, the
biggest corruption scandal in the history of Brazil, the report
adds.
As reported in the Troubled Company Reporter-Latin America on
March 14, 2018, Fitch Ratings has assigned a 'BB' rating to
Paraguay's US$530 million bond, maturing March 13, 2048. The bond
has a coupon of 5.6%. Proceeds from the issuance will be used for
capital expenditures and to refinance a portion of outstanding
debt.
======================
P U E R T O R I C O
======================
LRJ GLOBAL: Banco Desarollo to Get $2,493 Monthly Over 20 Years
---------------------------------------------------------------
LRJ Global Quality Concrete amended the disclosure statement
explaining its Chapter 11 plan to disclose that it has appraised
its property at $430,000, and the Debtor will pay Banco de
Desarrollo Economico Para PR the full amount of the loan in 20
years with an interest of 3.5% with a monthly payment of
$2,493.83.
The total interest to be paid will be $168,518.43 plus principal
of $430,000.00. The remainder amount of $33,051.08 claim will
participate in the pro-rata unsecured class.
A full-text copy of the Amended Disclosure Statement is available
at:
http://bankrupt.com/misc/prb17-04359-56.pdf
About LRJ Global Quality Concrete
Based in Yauco, Puerto Rico, LRJ Global Quality Concrete filed a
voluntary petition for reorganization pursuant to Chapter 11 of
the Bankruptcy Code (Bankr. D.P.R. Case No. 17-04359) on June 19,
2017.
The Debtors' assets and liabilities are both below $1 million.
The Debtor is represented by Nydia Gonzalez Ortiz, Esq. of
Santiago & Gonzalez.
S DIAMOND STEEL: June 19 Disclosure Statement Hearing
-----------------------------------------------------
Judge Brenda K. Martin of the U.S. Bankruptcy Court for the
District of Arizona will convene a hearing to consider the
approval of the Second Amended Disclosure Statement explaining S
Diamond Steel, Inc.'s Second Amended Plan of Reorganization on
June 19, 2018, at 1:30 p.m.
The Second Amended Disclosure Statement provides that the Debtor
and creditor Board of Trustees of the California Ironworkers Field
Pension Trust have entered into a Settlement Agreement, and a
motion to approve the same has been filed with the Court. The
Motion and Settlement Agreement in part provides as follows:
* S Diamond Steel, Inc. (as a reorganized debtor) will pay to
the Pension Fund the sum of $200,000 within 30 days of the
effective date of a confirmed plan of reorganization in the
bankruptcy case.
* S Diamond Steel, Inc. (as a reorganized debtor), M.M.
Stevens, LLC and Milco Solutions, Inc., Matthew Miles Stevens and
Dana Stevens will execute a promissory note in favor of the
Pension Fund in the principal sum of $1,632,647.46 with interest
accruing at the rate of 7.5% simple interest per annum on the
principal sum or on such portion of the principal sum as remains
unpaid until it is in paid in full. The note will be payable in 47
monthly installments of $39,250 with a final payment adjusted for
any accrued but unpaid principal and interest. The first monthly
payment will be made on the fifteenth day of the first full month
following the Effective Date. Each payment thereafter will be made
on the fifteenth day of each consecutive month thereafter, until
paid in full, and on such other terms and conditions set forth in
the Note. Stevens and the Controlled Group will execute and
deliver the Note to the Pension Fund on the Effective Date. The
Note may not be assigned to any third party. Additional or
otherwise advance payments may be made at any time to reduce the
principal and accruing interest without penalty. The date and
amount of any final payment will be adjusted accordingly.
A full-text copy of the Second Amended Disclosure Statement is
available at:
http://bankrupt.com/misc/azb2-16-07846-246.pdf
A full-text copy of the Second Amended Plan is available at:
http://bankrupt.com/misc/azb2-16-07846-247.pdf
About S Diamond Steel
S Diamond Steel, Inc., based in Phoenix, Arizona, has been in
business as a Steel fabrication and erection contractor primarily
in the states of Arizona, Nevada, New Mexico, and California since
2001. Since 2001, S Diamond has also worked in other states as
well as Puerto Rico.
The Debtor filed a Chapter 11 petition (Bankr. D. Ariz. Case No.
16-07846) on July 11, 2016. The petition was signed by Matthew
Miles Stevens, president. The case is assigned to Judge Brenda K.
Martin.
Allan NewDelman, Esq., at Allan D. NewDelman P.C. serves as the
Debtor's legal counsel. Guy W. Bluff, Esq., at Bluff & Associates
represents the Debtor in connection with a $1.9 million claim
filed by the Board of Trustees of the California Ironworkers Field
Pension Trust in November last year.
The Debtor disclosed $1.59 million in total assets and $5.58
million in total liabilities.
No official committee of unsecured creditors has been appointed in
the Debtor's case.
SPANISH BROADCASTING: Reports Preliminary Results for Q1 2018
-------------------------------------------------------------
Spanish Broadcasting System, Inc., reported preliminary estimated
financial results for the first quarter-ended March 31, 2018.
For the first quarter 2018, the Company currently estimates
consolidated net revenue to be between approximately $32.9 and
$33.9 million, an increase of between 5% and 8% over 2017 and
Adjusted OIBDA*, which excludes non-cash stock-based compensation,
to be between approximately $8.5 and $9.3 million, an increase of
between 44% and 58% over 2017. Consolidated operating income is
currently estimated to be between approximately $6.5 and $7.6
million, representing a growth rate of between 71% and 100% over
2017.
"Although extraordinary, unforeseen and non-recurring factors
affected our Year End results for 2017, I am happy to report that
our Q1 2018 results are the best in the Company's history. We are
focused on growing our top line while maintaining strictly
disciplined cost controls and delivering operating margins that
are among the best in the industry.
"Our experience in addressing the needs of the growing Hispanic
market, combined with our stable of heritage brands, will serve us
well in identifying growth opportunities throughout 2018 and
beyond," commented Raul Alarcon, chairman and CEO.
A full-text copy of the press release is available for free at:
https://is.gd/bqOjyw
About Spanish Broadcasting
Based in Miami, Florida, Spanish Broadcasting System, Inc.
(OTCMKTS:SBSAA) -- http://www.spanishbroadcasting.com/-- is a
Spanish-language media and entertainment company with radio and/or
television stations in the top U.S. Hispanic markets, including
Puerto Rico. The Company's owned and operated radio stations
serve markets representing approximately 35% of the U.S. Hispanic
population, and its television operations serve markets
representing over 3.5 million Hispanic households. The Company
produces and distributes Spanish-language content, including radio
programs, television shows, music and live entertainment through
its radio stations and its television group, MegaTV, which
produces over 70 hours of original programming per week. MegaTV
broadcasts via its owned and operated stations in South Florida,
Houston, and Puerto Rico and through programming and/or
distribution agreements with other stations, as well as various
cable and satellite providers.
The report from the Company's independent accounting firm Crowe
Horwath LLP, the Company's auditor since 2013, on the consolidated
financial statements for the year ended Dec. 31, 2017, includes an
explanatory paragraph stating that the 12.5% Senior Secured Notes
had a maturity date of April 15, 2017. Cash from operations or
the sale of assets was not sufficient to repay the notes when they
became due. In addition, for the year ended Dec. 31, 2017, the
Company had a working capital deficiency and negative cash flows
from operations. These factors raise substantial doubt about its
ability to continue as a going concern.
Spanish Broadcasting reported net income of $19.62 million for the
year ended Dec. 31, 2017, compared to a net loss of $16.34 million
for the year ended Dec. 31, 2016. As of Dec. 31, 2018, Spanish
Broadcasting had $435.9 million in total assets, $531.81 million
in total liabilities and a total stockholders' deficit of $95.91
million.
* * *
In May 2017, S&P Global Ratings withdrew its 'D' corporate credit
rating and issue-level ratings on Spanish Broadcasting System.
"We withdrew the ratings because we were unlikely to raise them
from 'D', based on SBS' ongoing plans to restructure its debt,"
said S&P Global Ratings' credit analyst Scott Zari. S&P had
downgraded SBS to 'D' on April 21, 2017, following the company's
announcement that it didn't repay its $275 million 12.5% senior
secured notes that were due April 15, 2017, as reported by the TCR
on May 25, 2017.
In April 2017, Moody's Investors Service downgraded SBS's
corporate family rating to 'Ca' from 'Caa2'. SBS's 'Ca' corporate
family rating reflects an elevated expected loss rate following
the default under the company's 12.5% senior secured notes due
April 2017.
SPANISH BROADCASTING: Swings to $19.6 Million Net Income in 2017
----------------------------------------------------------------
Spanish Broadcasting System, Inc., filed with the Securities and
Exchange Commission its Annual Report on Form 10-K reporting net
income of $19.62 million for the year ended Dec. 31, 2017,
compared to a net loss of $16.34 million for the year ended Dec.
31, 2016.
The decrease in net loss of $36.0 million was primarily due to the
income tax benefit and the decrease in interest expense, net,
offset by the decrease in operating income.
For the year-ended Dec. 31, 2017, consolidated net revenues
totaled $134.7 million compared to $144.6 million for the same
prior year period, resulting in a decrease of $9.9 million or 7%.
The Company's radio segment net revenues decreased $10.0 million
or 8%, due to decreases in local, national and network sales which
were offset by increases in special event revenues. The Company's
special events revenue increase occurred primarily in its Los
Angeles and San Francisco markets. The Company's television
segment net revenues increased $0.1 million or 1%, due to the
receipt of a non-broadcast subscriber based revenue true up
payment offset by a decrease in local revenues.
Consolidated Adjusted OIBDA, a non-GAAP measure, totaled $35.2
million compared to $47.5 million for the same prior year period,
resulting in a decrease of $12.3 million or 26%. The Company's
radio segment Adjusted OIBDA decreased $13.8 million or 24%,
primarily due to the decrease in net revenues of $10.1 million and
increase in operating expenses of $3.7 million. Radio station
operating expenses primarily increased due to increases from
managing special events through thirds parties to mitigate related
exposure, taxes and licenses, AIRE network-affiliate station
compensation, legal settlements, bad debt and facilities expenses
offset by decreases in transmission costs and sales related
commissions and bonuses. The Company's television segment
Adjusted OIBDA increased $1.8 million, due to the decrease in
station operating expenses of $1.7 million and the increase in net
revenues of $0.1 million. Television station operating expenses
decreased primarily due to an increase in production tax credits
which offset originally produced content production costs and
decreases in barter, professional fees and commission expenses.
Our corporate expenses, excluding non-cash stock-based
compensation, increased $0.3 million or 3% primarily due to
increases in compensation and benefits and airline charters to
provide humanitarian relief to Puerto Rico after Hurricane Maria
offset by decreases in professional fees.
Operating income totaled $40.5 million compared to $42.1 million
for the same prior year period, representing a decrease of $1.6
million or 4%. This decrease in operating income was mainly due
to the decrease in net revenue and increases in recapitalization
costs, selling, general and administrative, and corporate expenses
offset by the gains on the sale of the Los Angeles facility and
spectrum assets.
For the quarter ended Dec. 31, 2017, Spanish Broadcasting reported
net income of $34.97 million on $36.38 million of net revenue
compared to net income of $3.51 million on $42.11 million of net
revenue for the quarter ended Dec. 31, 2016.
"Our fourth quarter results largely reflect continued challenging
operating conditions for the radio industry," said Raul Alarcon,
Chairman and CEO. "While the radio market is facing headwinds,
our competitive position remains strong, with multiple top ranked
stations across key Latino markets nationwide and our AIRE radio
network closing the year with over 250 station affiliates. We
also advanced our multi-media capabilities in 2017, most notably
through a commitment to digital innovation, expanding our
capabilities and launching a more expansive LaMusica app. These
efforts drove increased share among key audience demographics
including Hispanic millennials. Moving forward, the entire SBS
team is sharply focused on building upon our successes to date.
Our goals in the year ahead include additional aggregate audience
share growth and the delivery of compelling multi-platform
experiences to our listeners and integrated advertising
opportunities to our brand partners."
As of Dec. 31, 2018, Spanish Broadcasting had $435.90 million in
total assets, $531.81 million in total liabilities and a total
stockholders' deficit of $95.91 million.
The report from the Company's independent accounting firm Crowe
Horwath LLP, the Company's auditor since 2013, on the consolidated
financial statements for the year ended Dec. 31, 2017, includes an
explanatory paragraph stating that the 12.5% Senior Secured Notes
had a maturity date of April 15, 2017. Cash from operations or
the sale of assets was not sufficient to repay the notes when they
became due. In addition, for the year ended Dec. 31, 2017, the
Company had a working capital deficiency and negative cash flows
from operations. These factors raise substantial doubt about its
ability to continue as a going concern.
Continued Recapitalization and Restructuring Efforts
Spanish Broadcasting stated in a press release that "We have not
repaid our outstanding 12.5% Senior Secured Notes due 2017 (the
"Notes") since they became due on April 17, 2017, and continue to
evaluate all options available to refinance the Notes. While we
assess how to best achieve a successful refinancing of the Notes,
we have continued to pay interest on the Notes, payments that a
group of investors purporting to own our 10 3/4% Series B
Cumulative Exchangeable Redeemable Preferred Stock (the "Series B
preferred stock") have challenged through the institution of
litigation in the Delaware Court of Chancery. The complaint filed
by these investors revealed a purported foreign ownership of our
Series B preferred stock, which we are actively addressing,
including before the Federal Communications Commission (the "FCC")
in order to protect our broadcast licenses. Our refinancing
efforts have been made more difficult and complex by the Series B
preferred stock litigation and foreign ownership issue. We
provide more information about each of these items in our Annual
Report on Form 10-K for the year ended December 31, 2017.
"We have worked and continue to work with our advisors regarding a
consensual recapitalization or restructuring of our balance sheet,
including through the issuance of new debt or equity to raise the
necessary funds to repay the Notes. The Series B preferred stock
litigation and the foreign ownership issue have complicated our
efforts at a successful refinancing of the Notes. We believe that
the delay in refinancing the Notes has adversely affected us,
including because we have been paying substantially more in
interest expense on our outstanding Notes than would be the case
if we refinanced them in the current market based on the feedback
we have received from several financial institutions and potential
sources of capital; there is a cloud on title regarding who
validly owns our Series B preferred stock, which has created
uncertainty as to who owns these shares, and the parties with whom
the Company could potentially negotiate a consensual
restructuring; we are incurring higher legal costs than otherwise
would be the case due to our efforts to resolve the situation in
general, to defend ourselves against the Series B preferred stock
litigation and to address the foreign ownership issue before the
FCC; the trading price of our common stock and preferred stock has
been materially adversely affected; our ability to attract
interest from investment banks and third party capital suppliers
has been materially adversely affected; our reputation has been
similarly negatively affected as a general matter despite our
diligent efforts to resolve the situation; and the negativity and
complexity surrounding our situation has been an unfortunate
distraction from our otherwise successful business,
notwithstanding the decrease in consolidated net revenue and
operating income for the fourth quarter and year ended December
31, 2017, and the negative impact that Hurricanes Harvey, Irma and
Maria have had on us. The resolution of the recapitalization or
restructuring of our balance sheet, the litigation with the
purported holders of our Series B preferred stock and the foreign
ownership issue are subject to several factors currently beyond
our control. Our efforts to effect a consensual refinancing of
the Notes, the Series B preferred stock litigation and the foreign
ownership issue will likely continue to have a material adverse
effect on us if they are not successfully resolved. We face
various risks regarding these matters which are summarized in our
Annual Report on Form 10-K for the year ended December 31, 2017."
Spanish Broadcasting filed its Annual Report on May 23, 2018,
after it was due, as a result of needing more time to resolve the
accounting and tax treatment, and related disclosure, regarding
certain income tax related matters.
A full-text copy of the Form 10-K is available for free at:
https://is.gd/g7yNSJ
About Spanish Broadcasting
Based in Miami, Florida, Spanish Broadcasting System, Inc.
(OTCMKTS:SBSAA) -- http://www.spanishbroadcasting.com/-- Spanish
Broadcasting System, Inc. owns and operates 17 radio stations
located in the top U.S. Hispanic markets of New York, Los Angeles,
Miami, Chicago, San Francisco and Puerto Rico, airing the Spanish
Tropical, Regional Mexican, Spanish Adult Contemporary, Top 40 and
Latin Rhythmic format genres. SBS also operates AIRE Radio
Networks, a national radio platform which creates, distributes and
markets leading Spanish-language radio programming to over 250
affiliated stations reaching 94% of the U.S. Hispanic audience.
SBS also owns MegaTV, a television operation with over-the-air,
cable and satellite distribution and affiliates throughout the
U.S. and Puerto Rico. SBS also produces live concerts and events
and owns multiple bilingual websites, including www.LaMusica.com,
an online destination and mobile app providing content related to
Latin music, entertainment, news and culture.
* * *
In May 2017, S&P Global Ratings withdrew its 'D' corporate credit
rating and issue-level ratings on Spanish Broadcasting System.
"We withdrew the ratings because we were unlikely to raise them
from 'D', based on SBS' ongoing plans to restructure its debt,"
said S&P Global Ratings' credit analyst Scott Zari. S&P had
downgraded SBS to 'D' on April 21, 2017, following the company's
announcement that it didn't repay its $275 million 12.5% senior
secured notes that were due April 15, 2017, as reported by the TCR
on May 25, 2017.
In April 2017, Moody's Investors Service downgraded SBS's
corporate family rating to 'Ca' from 'Caa2'. SBS's 'Ca' corporate
family rating reflects an elevated expected loss rate following
the recently announced default under the company's 12.5% senior
secured notes due April 2017.
TOYS R US: U.S. Trustee Forms 5-Member Panel for Propco I Debtors
-----------------------------------------------------------------
The U.S. Trustee for Region 1 on May 23 appointed five creditors
to serve on the official committee of unsecured creditors in the
Chapter 11 cases of Toys "R" Us Property Company I, LLC and its
affiliates ("Propco I Debtors").
The committee members are:
(1) Cantor Fitzgerald Securities
Attn: Jon Stapleton
110 East 59th Street
New York, NY 10022
(2) DDR Corp.
Attn: Eric C. Cotton
3300 Enterprise Parkway
Beachwood, Ohio 44122
(3) Empyrean Investments, LLC
Attn: F. Martin Meekins
10250 Constellation Blvd., Suite 2930
Los Angeles, CA 90067
(4) GGP Limited Partnership
Attn: Julie M. Bowden
350 N. Orleans St., Suite 300
Chicago, IL 60654-1607
(5) Glendon Capital Management, LP
Attn: Chris Delaney
1620 26th Street, Suite 2000N
Santa Monica, CA 90404
Official creditors' committees have the right to employ legal and
accounting professionals and financial advisors, at a debtor's
expense. They may investigate the debtor's business and financial
affairs. Importantly, official committees serve as fiduciaries to
the general population of creditors they represent.
About Toys R Us, Inc.
Toys "R" Us, Inc., was an American toy and juvenile-products
retailer founded in 1948 and headquartered in Wayne, New Jersey,
in the New York City metropolitan area. Merchandise was sold in
880 Toys "R" Us and Babies "R" Us stores in the United States,
Puerto Rico and Guam, and in more than 780 international stores
and more than 245 licensed stores in 37 countries and
jurisdictions. Merchandise was also sold at e-commerce sites
including Toysrus.com and Babiesrus.com.
On July 21, 2005, a consortium of Bain Capital Partners LLC,
Kohlberg Kravis Roberts, and Vornado Realty Trust invested $1.3
billion to complete a $6.6 billion leveraged buyout of the
company.
Toys "R" Us is a privately owned entity but still files with the
Securities and Exchange Commission as required by its debt
agreements.
The Company's consolidated balance sheet showed $6.572 billion in
assets, $7.891 billion in liabilities, and a stockholders' deficit
of $1.319 billion as of April 29, 2017.
Toys "R" Us, Inc., and certain of its U.S. subsidiaries and its
Canadian subsidiary voluntarily filed for relief under Chapter 11
of the Bankruptcy Code (Bankr. E.D. Va. Lead Case No. Case No.
17-34665) on Sept. 19, 2017. In addition, the Company's Canadian
subsidiary voluntarily commenced parallel proceedings under the
Companies' Creditors Arrangement Act ("CCAA") in Canada in the
Ontario Superior Court of Justice. The Company's operations
outside of the U.S. and Canada, including its 255 licensed stores
and joint venture partnership in Asia, which are separate
entities, were not part of the Chapter 11 filing and CCAA
proceedings.
Grant Thornton is the monitor appointed in the CCAA case.
Judge Keith L. Phillips presides over the Chapter 11 cases.
In the Chapter 11 cases, Kirkland & Ellis LLP and Kirkland & Ellis
International LLP serve as the Debtors' legal counsel. Kutak Rock
LLP serves as co-counsel. Toys "R" Us employed Alvarez & Marsal
North America, LLC as its restructuring advisor; and Lazard Freres
& Co. LLC as its investment banker. It hired Prime Clerk LLC as
claims and noticing agent. Consensus Advisory Services LLC and
Consensus Securities LLC, as sale process investment banker. A&G
Realty Partners, LLC, serves as its real estate advisor.
On Sept. 26, 2017, the U.S. Trustee for Region 4 appointed an
official committee of unsecured creditors. The Committee retained
Kramer Levin Naftalis & Frankel LLP as its legal counsel; Wolcott
Rivers, P.C. as local counsel; FTI Consulting, Inc. as financial
advisor; and Moelis & Company LLC as investment banker.
Toys "R" Us UK
Toys "R" Us Limited, Toys "R" Us, Inc.'s UK arm with 105 stores
and 3,000 employees, was sent into administration in the United
Kingdom in February 2018.
Arron Kendall and Simon Thomas of Moorfields Advisory Limited, 88
Wood Street, London, EC2V 7QF were appointed Joint Administrators
on Feb. 28, 2018. The Administrators now manage the affairs,
business and property of the Company. The Administrators act as
agents only and without personal liability.
The Administrators said they will make every effort to secure a
buyer for all or part of the business.
Liquidation of U.S. Stores
Toys "R" Us, Inc., on March 15, 2018, filed with the U.S.
Bankruptcy Court a motion seeking Bankruptcy Court approval to
start the process of conducting an orderly wind-down of its U.S.
business and liquidation of inventory in all 735 of the Company's
U.S. stores, including stores in Puerto Rico.
About Toys R Us Property Company I
Toys "R" Us Property Company I, LLC and its subsidiaries own fee
and leasehold interests in more than 300 properties in the United
States. The Debtors lease the properties on a triple-net basis
under a master lease to Toys-Delaware, the operating entity for
all of TRU's North American businesses, which operates the
majority of the properties as Toys "R" Us stores, Babies "R" Us
stores or side-by-side stores, or subleases them to alternative
retailers.
Toys "R" Us Property was founded in 2005 and is headquartered in
Wayne, New Jersey. Toys 'R' Us Property operates as a subsidiary
of Toys "R" Us Inc.
Toys "R" Us Property and affiliates Wayne Real Estate Holding
Company LLC, MAP Real Estate LLC, TRU 2005 RE I LLC, TRU 2005 RE
II Trust, and Wayne Real Estate Company LLC sought protection
under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Va. Lead Case
No. 18-31429) on March 20, 2018. The Propco I Debtors sought and
obtained procedural consolidation and joint administration of
their Chapter 11 cases, separate from the Toys "R" Us Debtors'
Chapter 11 cases.
The Propco I Debtors disclosed that they had estimated assets of
$500 million to $1 billion and liabilities of $500 million to $1
billion.
Judge Keith L. Phillips presides over the Propco I Debtors' cases.
The Propco I Debtors hired Klehr Harrison Harvey Branzburg, LLP;
and Crowley, Liberatore, Ryan & Brogan, P.C., as co-counsel.
According to the petition, the Debtors also tapped Kutak Rock LLP.
They hired Goldin Associates, LLC as financial advisors.
TOYS R US: MGA CEO Larian Drops Bid to Buy Stores
-------------------------------------------------
Jaclyn Cosgrove, writing for the Los Angeles Times, reports that
Isaac Larian, CEO of MGA Entertainment, has said he has given up
his effort to buy several hundred Toys R Us stores after he and
the company's debt holders were unable to reach an agreement.
According to the report, a group of investors led by Larian had
submitted a $675-million bid April 13 for 274 of the 735 U.S. and
Puerto Rican stores the retailer is liquidating. The bid was
rejected as inadequate, but Larian said in April he planned to
sweeten the bid for the U.S. stores after a separate $215-million
offer he made for 82 Canadian Toys R Us stores was topped by a
Toronto investment firm. However, Larian said that negotiations
since then have failed to prove fruitful.
"The so-called advisors and lawyers milked that company to death
in a matter of seven months, which is remarkable," he said,
according to LA Times. "And the current lenders are just not in
touch with reality on valuation."
LA Times reports that Toys R Us declined to comment on Larian's
decision, as did Joseph Malfitano, asset-disposition advisor for
Toys R Us. Attorneys at firms Kirkland & Ellis and Kutak Rock,
which have served as co-counsel for Toys R Us, did not immediately
respond to requests for comment.
About Toys R Us, Inc.
Toys "R" Us, Inc., was an American toy and juvenile-products
retailer founded in 1948 and headquartered in Wayne, New Jersey,
in the New York City metropolitan area. Merchandise was sold in
880 Toys "R" Us and Babies "R" Us stores in the United States,
Puerto Rico and Guam, and in more than 780 international stores
and more than 245 licensed stores in 37 countries and
jurisdictions. Merchandise was also sold at e-commerce sites
including Toysrus.com and Babiesrus.com.
On July 21, 2005, a consortium of Bain Capital Partners LLC,
Kohlberg Kravis Roberts, and Vornado Realty Trust invested $1.3
billion to complete a $6.6 billion leveraged buyout of the
company.
Toys "R" Us is a privately owned entity but still files with the
Securities and Exchange Commission as required by its debt
agreements.
The Company's consolidated balance sheet showed $6.572 billion in
assets, $7.891 billion in liabilities, and a stockholders' deficit
of $1.319 billion as of April 29, 2017.
Toys "R" Us, Inc., and certain of its U.S. subsidiaries and its
Canadian subsidiary voluntarily filed for relief under Chapter 11
of the Bankruptcy Code (Bankr. E.D. Va. Lead Case No. Case No.
17-34665) on Sept. 19, 2017. In addition, the Company's Canadian
subsidiary voluntarily commenced parallel proceedings under the
Companies' Creditors Arrangement Act ("CCAA") in Canada in the
Ontario Superior Court of Justice. The Company's operations
outside of the U.S. and Canada, including its 255 licensed stores
and joint venture partnership in Asia, which are separate
entities, were not part of the Chapter 11 filing and CCAA
proceedings.
Grant Thornton is the monitor appointed in the CCAA case.
Judge Keith L. Phillips presides over the Chapter 11 cases.
In the Chapter 11 cases, Kirkland & Ellis LLP and Kirkland & Ellis
International LLP serve as the Debtors' legal counsel. Kutak Rock
LLP serves as co-counsel. Toys "R" Us employed Alvarez & Marsal
North America, LLC as its restructuring advisor; and Lazard Freres
& Co. LLC as its investment banker. It hired Prime Clerk LLC as
claims and noticing agent. Consensus Advisory Services LLC and
Consensus Securities LLC, as sale process investment banker. A&G
Realty Partners, LLC, serves as its real estate advisor.
On Sept. 26, 2017, the U.S. Trustee for Region 4 appointed an
official committee of unsecured creditors. The Committee retained
Kramer Levin Naftalis & Frankel LLP as its legal counsel; Wolcott
Rivers, P.C. as local counsel; FTI Consulting, Inc. as financial
advisor; and Moelis & Company LLC as investment banker.
Toys "R" Us UK
Toys "R" Us Limited, Toys "R" Us, Inc.'s UK arm with 105 stores
and 3,000 employees, was sent into administration in the United
Kingdom in February 2018.
Arron Kendall and Simon Thomas of Moorfields Advisory Limited, 88
Wood Street, London, EC2V 7QF were appointed Joint Administrators
on Feb. 28, 2018. The Administrators now manage the affairs,
business and property of the Company. The Administrators act as
agents only and without personal liability.
The Administrators said they will make every effort to secure a
buyer for all or part of the business.
Liquidation of U.S. Stores
Toys "R" Us, Inc., on March 15, 2018, filed with the U.S.
Bankruptcy Court a motion seeking Bankruptcy Court approval to
start the process of conducting an orderly wind-down of its U.S.
business and liquidation of inventory in all 735 of the Company's
U.S. stores, including stores in Puerto Rico.
About Toys R Us Property Company I
Toys "R" Us Property Company I, LLC and its subsidiaries own fee
and leasehold interests in more than 300 properties in the United
States. The Debtors lease the properties on a triple-net basis
under a master lease to Toys-Delaware, the operating entity for
all of TRU's North American businesses, which operates the
majority of the properties as Toys "R" Us stores, Babies "R" Us
stores or side-by-side stores, or subleases them to alternative
retailers.
Toys "R" Us Property was founded in 2005 and is headquartered in
Wayne, New Jersey. Toys 'R' Us Property operates as a subsidiary
of Toys "R" Us Inc.
Toys "R" Us Property and affiliates Wayne Real Estate Holding
Company LLC, MAP Real Estate LLC, TRU 2005 RE I LLC, TRU 2005 RE
II Trust, and Wayne Real Estate Company LLC sought protection
under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Va. Lead Case
No. 18-31429) on March 20, 2018. The Propco I Debtors sought and
obtained procedural consolidation and joint administration of
their Chapter 11 cases, separate from the Toys "R" Us Debtors'
Chapter 11 cases.
The Propco I Debtors disclosed that they had estimated assets of
$500 million to $1 billion and liabilities of $500 million to $1
billion.
Judge Keith L. Phillips presides over the Propco I Debtors' cases.
The Propco I Debtors hired Klehr Harrison Harvey Branzburg, LLP;
and Crowley, Liberatore, Ryan & Brogan, P.C., as co-counsel.
According to the petition, the Debtors also tapped Kutak Rock LLP.
They hired Goldin Associates, LLC as financial advisors.
An official committee of unsecured creditors has been appointed in
the Propco I Debtors' cases.
TOYS R US: Bank Debt Trades at 18.33% Off
-----------------------------------------
Participations in a syndicated loan under which Toys R Us Inc. is
a borrower traded in the secondary market at 81.67 cents-on-the-
dollar during the week ended Friday, May 18, 2018, according to
data compiled by LSTA/Thomson Reuters MTM Pricing.
This represents a decrease of 1.41 percentage points from the
previous week. Toys R Us pays 500 basis points above LIBOR to
borrow under the $985 million facility. The bank loan matures on
August 21, 2019. Moody's withdraw the rating of the loan and
Standard & Poor's gave no rating to the loan. The loan is one of
the biggest gainers and losers among 247 widely quoted syndicated
loans with five or more bids in secondary trading for the week
ended Friday, May 18.
================================
T R I N I D A D & T O B A G O
================================
TRINIDAD & TOBAGO: Tax Bill Should Make Country Compliant
---------------------------------------------------------
Colm Imbert made a statement in Parliament on the issue of T&T's
non-compliance with the EU standards on May 25, the same day that
St Kitts and Nevis and The Bahamas were removed from the EU's non-
compliant list, according to Trinidad Express.
The removal of those countries left T&T as the only non-compliant
Caricom country, the report notes.
In his statement, Mr. Imbert said: "The rating of being non-
compliant was one of the main contributors of T&T being listed as
a non-cooperative tax jurisdiction by the European Union last
year. But it does not mean, as has been incorrectly interpreted
by some commentators, that T&T has been declared to be a tax
haven. We are not compliant in terms of the sharing of information
with the tax authorities in other countries," the report relays.
Trinidad Express reports that the review will determine whether
the country's legal and regulatory systems are in place to
exchange tax information with other countries and, consequently,
if T&T will remain on the EU's non-compliant list.
=============
U R U G U A Y
=============
NAVIOS SOUTH: S&P Raises Corp Credit Rating to 'B', Outlook Stable
------------------------------------------------------------------
S&P Global Ratings raised its corporate credit rating on Navios
South American Logistics Inc. (Navios Logistics) to 'B' from 'B-'.
S&P said, "We also raised our issue-level ratings on the company
to 'B' from 'B-'. At the same time, we affirmed our 'b' SACP on
the company. The outlook on the corporate rating remains stable."
The upgrade mirrors the same rating action on Navios Logistics'
parent company, Navios Maritime Holdings Inc. (Navios Holdings;
B/Stable/--), which now no longer caps Navios Logistics' SACP of
'b', since it's at the same level as its parent. S&P continues to
view Navios Logistics as a strategically important subsidiary
because it contributes about 30% to the group's EBITDA and helps
drive growth. Navios Holdings controls and consolidates the
company's financials and defines the subsidiary's financial
policies and cash and debt management. This was illustrated by
Navios Logistics' secured term loan facility it issued in November
2017, when majority of the proceeds were distributed as dividends
to shareholders.
Navios Logistics consists of three business units: port terminals
for liquid and dry cargo storage services in Uruguay and Paraguay
(59% of 2017 EBITDA); barge transportation in the Paraguay-Paranâ€
rivers (28% of 2017 EBITDA); and cabotage transportation of oil-
refined products along Argentina's Atlantic coast (13% of EBITDA
in 2017). Going forward, we expect the port segment to grow,
contributing around 70% of EBITDA.
S&P said, "We expect Navios Logistics to increase volumes
transported in 2018 and 2019, boosting cash flows from port
terminals and resulting in improved credit metrics. This will
mainly come from the grain terminal's recovering volumes, and,
more importantly, from the iron ore storage and trans-shipment
contract with Brazilian miner Vale S.A. (Vale; BBB-/Stable/--)
which is likely to add around $39 million to Navios Logistics'
annual EBITDA in 2018 and result in $1.2 billion estimated
aggregate EBITDA for the 20-year contract period.
"We also expect the company to continue benefiting from its long-
term contracted shipping position, which mitigates the risks
inherent in operating in the Paraguay River area, such as volatile
volumes and spot rates. Furthermore, given its historical
operating efficiency, we expect Navios Logistics to be in a better
position than some of its competitors in the barge business.
Despite these factors, we assess the company's business risk
profile as weak mainly because of the volatile nature of the
shipping business, its small scale, and its exposure to low-rated
jurisdictions such as Argentina."
***********
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 2018. 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.
.
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