/raid1/www/Hosts/bankrupt/TCRLA_Public/180903.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
L A T I N A M E R I C A
Monday, September 3, 2018, Vol. 19, No. 174
Headlines
A R G E N T I N A
ARGENTINA: Lifts Rates to World-High, Seeks IMF Aid to Save Peso
ARGENTINA: Ministry of Agroindustry Workers Protest Over Layoffs
B R A Z I L
COMPANHIA ENERGETICA: S&P Affirms 'B' ICR, Outlook Positive
COSAN LTD: Lonestar Capital Takes Position in Firm
COSAN LTD: S&P Affirms 'BB-' Issuer Credit Rating, Outlook Stable
RUMO SA: S&P Affirms 'BB-' LT Global Scale ICR, Outlook Stable
P U E R T O R I C O
ARQUIDIOCESIS DE SAN JUAN: Case Summary & 20 Unsecured Creditors
PUERTO RICO: GDB Modification Filing Deadline Set for Sept. 12
V E N E Z U E L A
PETROLEOS DE VENEZUELA: To Divert Tankers to Nearby Port
VENEZUELA: Colombia Urges Urgent Creation of Exodus Fund
X X X X X X X X X
* BOND PRICING: For the From August 27 to August 31, 2018
- - - - -
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A R G E N T I N A
=================
ARGENTINA: Lifts Rates to 60%, Seeks IMF Aid to Save Peso
---------------------------------------------------------
Carolina Millan, Patrick Gillespie, and Ignacio Olivera Doll at
Bloomberg News report that Argentina's currency crisis deepened as an
emergency interest-rate increase to 60 percent failed to stop jittery
investors from pulling their money out of the country.
The peso extended losses after the bank raised its benchmark measure
by 15 percentage points to a global high, according to Bloomberg News.
The hike, the second in August, was the latest attempt by policy
makers to defend a currency that's lost more than half its value this
year, Bloomberg News relays. A day earlier, President Mauricio Macri
shocked the nation with an appeal for quicker payouts from the
International Monetary Fund, which said it's considering the request,
Bloomberg News notes.
The peso was down about 12 percent against the dollar at 3:05 p.m. in
Buenos Aires on Aug. 30, after a daily decline that at one point
approached 20 percent, Bloomberg News says. It's the steepest loss
since Macri devalued the currency right after taking office in
December 2015 -- and it's reviving memories of the crash that led to
debt default and social upheaval almost two decades ago, Bloomberg
News relays.
Bloomberg News notes that Argentine peso worst performer versus dollar
this year among emerging-market peers
Under Mr. Macri's market-friendly government Argentina appears to be
plunging back into that kind of financial turmoil, Bloomberg News
says. Investors are running out of faith that the president, who came
to power after more than a decade of budget-busting populism, can
shore up the economy and bring Argentina's fiscal and trade deficits,
and its inflation rate, to manageable levels, Bloomberg News relays.
Mr. Macri had promised a smooth, gradual fix. That option may be disappearing.
"The market isn't giving them a choice," said Edwin Gutierrez, the
London-based head of emerging-market sovereign debt at Aberdeen
Standard Investments, Bloomberg News discloses. "It's forcing them to
get it over with," he added.
The unfolding crisis in Argentina sent tremors through other emerging
markets, already shaken last month by a similar -- and ongoing --
crash in Turkey, Bloomberg News discloses. The lira fell almost 3
percent on Aug. 30, and currencies from Mexico to South Africa also
posted losses, Bloomberg News says. Brazil's central bank intervened
to shore up the real with additional swap auctions, Bloomberg News
notes.
Argentina had some defenses in place, after securing the biggest IMF
loan in history, a $50 billion credit package agreed in June,
Bloomberg News discloses.
Bloomberg News relays that the country also has relatively low levels
of foreign-currency debt, after defaulting in 2001 and then enduring
more than a decade virtually shut out of global finance. Including
that episode, the South American nation has stiffed
creditors eight times in the two centuries since it gained
independence from Spain, Bloomberg News notes.
But it's returned to the markets at a rapid clip under Macri, whose
ballot victory was hailed by investors and U.S. policy-makers as a
welcome swing of the pendulum, after two decades when the political
left posted a series of wins in Latin America, Bloomberg News relays.
He's due to seek re-election in October next year. But the economic
backdrop to that campaign is starting to look grim, Bloomberg News
notes.
Inflation has stuck above 30 percent and is set to accelerate on a
weaker peso, Bloomberg News says. Even before the latest slump, the
government was forecasting that the economy would contract 1 percent
in 2018, a sharp deterioration from the 3 percent growth that was
predicted at the start of this year, Bloomberg News discloses.
Argentina is headed for a "hard landing recession" in the next 12
months that will put Mr. Macri under pressure, Paul Greer, a money
manager at Fidelity International in London, wrote in an email
obtained by Bloomberg News. Conditions for emerging markets are
"unforgiving," he said, Bloomberg News notes.
Out of Time?
The government's pre-crisis plan was to chip away at the budget
deficit, lowering it from 6.5 percent of GDP to 5.1 percent this year,
and 3.8 percent in 2019, Bloomberg News discloses.
More drastic cuts are now likely. Treasury Minister Nicolas Dujovne
told reporters that the government is working on a plan to chop its
fiscal deficit more rapidly so that it can reduce borrowing, Bloomberg
News relays. No details were provided.
The Fund says it's weighing Macri's surprise request, made in a
televised address to the country, for disbursements to be speeded up,
Bloomberg News notes.
"They said this IMF agreement will be ready in a few weeks," said
Aberdeen's Gutierrez, Bloomberg News says. "Do they have a few weeks?
I'm not sure they do," he added.
As reported in the Troubled Company Reporter-Latin America on
June 7, 2018, S&P Global Ratings affirmed on June 4, 2018, its
'B+' long-term sovereign credit ratings on the Republic of
Argentina. The outlook on the long-term ratings remains stable.
S&P also affirmed its short-term sovereign credit ratings on
Argentina at 'B', its 'raAA' national-scale ratings, and its
transfer and convertibility assessment of 'BB-'.
S&P said the stable outlook incorporates its expectation that
the Macri Administration will implement additional austerity-based
economic measures in the coming six months to contain and soon
reverse the deterioration in inflation dynamics, reduce the fiscal
deficit, and stabilize the economy. S&P expects the government's
decision to enter into an agreement with the International
Monetary Fund (IMF) will help sustain investor confidence and
maintain its access to capital market funding for its large fiscal
deficits. S&P expects that effective implementation of corrective
economic policies, including revised budgetary targets for this
year and next, will set the stage for better policy predictability
and continuity over the next several years.
Fitch Ratings affirmed on May 8, 2018, Argentina's Long-Term
Foreign-Currency Issuer Default Rating (IDR) at 'B' and revised
the Outlook to Stable from Positive.
On December 4, 2017, Moody's Investors Service upgraded the
Government of Argentina's local and foreign currency issuer and
senior unsecured ratings to B2 from B3. The senior unsecured
shelves were upgraded to (P)B2 from (P)B3. The outlook on the
ratings is stable. At the same time, Argentina's short-term
rating was affirmed at Not Prime (NP). The senior unsecured
ratings for unrestructured debt were affirmed at Ca and the
unrestructured senior unsecured shelf affirmed at (P)Ca.
As previously reported by the TCR-LA, Argentina defaulted on some
of its debt late July 30, 2014, after expiration of a 30- grace
period on a US$539 million interest payment. Earlier that ,
talks with a court-appointed mediator ended without resolving a
standoff between the country and a group of hedge funds seeking
full payment on bonds that the country had defaulted on in 2001.
A U.S. judge had ruled that the interest payment couldn't be made
unless the hedge funds led by Elliott Management Corp., got the
US$1.5 billion they claimed. The country hasn't been able to
access international credit markets since its US$95 billion
default 13 years ago. On March 30, 2016, Argentina's Congress
passed a bill that will allow the government to repay holders of
debt that the South American country defaulted on in 2001,
including a group of litigating hedge funds that won judgments
in a New York court. The bill passed by a vote of 54-16.
ARGENTINA: Ministry of Agroindustry Workers Protest Over Layoffs
----------------------------------------------------------------
EFE News reports that hundreds of employees from the Argentine
Ministry of Agroindustry protested here against the firing of nearly
600 people, demanding that they be reinstated to prevent negative
impacts on family agriculture.
". . . we organized a negotiating table regarding the five people who
were fired, and now we were notified that 567 more people will be
fired, 102 in the city of Buenos Aires and the rest in the other
provinces," Daniel Catalano, secretary general of the Association of
Government Employees (ATE) of Buenos Aires, told EFE.
As reported in the Troubled Company Reporter-Latin America on
June 7, 2018, S&P Global Ratings affirmed on June 4, 2018, its
'B+' long-term sovereign credit ratings on the Republic of
Argentina. The outlook on the long-term ratings remains stable.
S&P also affirmed its short-term sovereign credit ratings on
Argentina at 'B', its 'raAA' national-scale ratings, and its
transfer and convertibility assessment of 'BB-'.
S&P said the stable outlook incorporates its expectation that
the Macri Administration will implement additional austerity-based
economic measures in the coming six months to contain and soon
reverse the deterioration in inflation dynamics, reduce the fiscal
deficit, and stabilize the economy. S&P expects the government's
decision to enter into an agreement with the International
Monetary Fund (IMF) will help sustain investor confidence and
maintain its access to capital market funding for its large fiscal
deficits. S&P expects that effective implementation of corrective
economic policies, including revised budgetary targets for this
year and next, will set the stage for better policy predictability
and continuity over the next several years.
Fitch Ratings affirmed on May 8, 2018, Argentina's Long-Term
Foreign-Currency Issuer Default Rating (IDR) at 'B' and revised
the Outlook to Stable from Positive.
On December 4, 2017, Moody's Investors Service upgraded the
Government of Argentina's local and foreign currency issuer and
senior unsecured ratings to B2 from B3. The senior unsecured
shelves were upgraded to (P)B2 from (P)B3. The outlook on the
ratings is stable. At the same time, Argentina's short-term
rating was affirmed at Not Prime (NP). The senior unsecured
ratings for unrestructured debt were affirmed at Ca and the
unrestructured senior unsecured shelf affirmed at (P)Ca.
As previously reported by the TCR-LA, Argentina defaulted on some
of its debt late July 30, 2014, after expiration of a 30- grace
period on a US$539 million interest payment. Earlier that ,
talks with a court-appointed mediator ended without resolving a
standoff between the country and a group of hedge funds seeking
full payment on bonds that the country had defaulted on in 2001.
A U.S. judge had ruled that the interest payment couldn't be made
unless the hedge funds led by Elliott Management Corp., got the
US$1.5 billion they claimed. The country hasn't been able to
access international credit markets since its US$95 billion
default 13 years ago. On March 30, 2016, Argentina's Congress
passed a bill that will allow the government to repay holders of
debt that the South American country defaulted on in 2001,
including a group of litigating hedge funds that won judgments
in a New York court. The bill passed by a vote of 54-16.
===========
B R A Z I L
===========
COMPANHIA ENERGETICA: S&P Affirms 'B' ICR, Outlook Positive
-----------------------------------------------------------
S&P Global Ratings affirmed its 'B' global scale and 'brA+' national
scale issuer credit ratings on Companhia Energetica de Minas Gerais
(Cemig) and on its operating subsidiaries, Cemig Distribuicao S.A.
(Cemig D) and Cemig Geracao e Transmissao S.A. (Cemig GT). The outlook
remains positive. The 'b' stand-alone credit profile (SACP) on Cemig
remains unchanged. S&P also affirmed its 'B' issue-level ratings on
Cemig GT's senior unsecured notes.
S&P said, "The ratings affirmation reflects our opinion that we don't
expect an extraordinary interference from Minas Gerais in Cemig--in
the form of extracting assets, capital, or liquidity--that could
further impair the company's liquidity and credit metrics.
Nevertheless, Cemig remains exposed to the overall macroeconomic
weakness stemming from its state government-related entity status,
resulting in a weaker comparison to some of its peers in the utilities
segment. On Aug. 24, 2018, we lowered the ratings on Minas Gerais to
'CCC-' from 'B-' on the global scale and to 'brCCC-' from 'brBBB-' on
the national scale, reflecting the heightened risk of default given
that we now detect greater uncertainties over the state's ability to
service debt payments coming due within the next six months.
"Although Minas Gerais owns 51% of the company, we view the risk of
intervention as mitigated by the regulatory framework, because Cemig
operates under the supervision of the federal-level regulator Agencia
Nacional de Energia Eletrica (ANEEL). In addition, the financial
covenants for a significant portion of Cemig's debt put significant
restrictions, including limitation on dividends distribution to the
minimum amount, as defined in the group's bylaws, and prohibit any
amendment of the latter. Also, Cemig's high debt limits, in our view,
its capacity to upstream funds. These facts reinforce our view that
even under a hypothetical default scenario of Minas Gerais, Cemig will
continue operating and servicing its debt. Therefore, the company
remains rated above its controlling shareholder at this point.
"We still expect Cemig's credit metrics to gradually improve over the
next few years, as a result of the positive effect from the 23.19%
electricity rate readjustment that Cemig D received in May 2018.
Although this should benefit Cemig's overall operating performance and
cash flows, a substantial debt reduction would only come once the
group manages to divest some of its portfolio of assets. Last year, it
announced an R$8 billion divestiture program, which includes its
stakes in Light S.A. (not rated) and in the Santo Antonio and Belo
Monte hydro projects. Nevertheless, we acknowledge that the timing of
these sales is uncertain because it depends on market conditions and
investor appetite."
COSAN LTD: Lonestar Capital Takes Position in Firm
--------------------------------------------------
Press Oracle reports that Lonestar Capital Management LLC acquired a
new stake in Cosan Ltd during the 2nd quarter, according to its most
recent disclosure with the Securities and Exchange Commission. The
institutional investor acquired 1,198,400 shares of the basic
materials company's stock, valued at approximately $9,144,000,
according to Press Oracle. Cosan comprises about 3.0% of Lonestar
Capital Management LLC's portfolio, making the stock its 12th largest
position, the report relays. Lonestar Capital Management LLC owned
about 0.49% of Cosan at the end of the most recent quarter, the report
says.
Several other hedge funds have also added to or reduced their stakes
in the company, the report relays. Wells Fargo & Company MN boosted
its holdings in shares of Cosan by 97.1% in the 2nd quarter, the
report discloses. Wells Fargo & Company MN now owns 3,862,922 shares
of the basic materials company's stock valued at $29,474,000 after
acquiring an additional 1,903,141 shares during the last quarter, the
report says. Acadian Asset Management LLC boosted its holdings in
Cosan by 91.1% during the second quarter, the report relays.
Acadian Asset Management LLC now owns 2,613,750 shares of the basic
materials company's stock worth $19,942,000 after buying an additional
1,245,933 shares in the last quarter, the report notes. Hsbc Holdings
PLC boosted its holdings in Cosan by 27.6% during the first quarter,
the report discloses. Hsbc Holdings PLC now owns 2,163,847 shares of
the basic materials company's stock worth $22,484,000 after buying an
additional 467,838 shares in the last quarter, the report says.
Millennium Management LLC boosted its holdings in Cosan by 10.0%
during the first quarter, the report notes. Millennium Management LLC
now owns 2,118,061 shares of the basic materials company's stock worth
$22,007,000 after buying an additional 192,606 shares in the last
quarter, the report relays.
Finally, BlackRock Inc. boosted its holdings in Cosan by 47.0% during
the second quarter, the report notes. BlackRock Inc. now owns
1,757,324 shares of the basic materials company's stock worth
$13,409,000 after buying an additional 561,980 shares in the last
quarter. 26.72% of the stock is currently owned by institutional
investors and hedge funds, the report says.
A number of analysts recently issued reports on the stock. Credit
Suisse Group downgraded shares of Cosan from an "outperform" rating to
a "neutral" rating in a report, July 23, the report discloses. Zacks
Investment Research downgraded shares of Cosan from a "hold" rating to
a "strong sell" rating in a report on July 31, the report says. One
equities research analyst has rated the stock with a sell rating, four
have issued a hold rating and one has issued a buy rating to the
stock, the report notes. Cosan currently has a consensus rating of
"Hold" and an average price target of $12.50, the report adds.
Cosan disclosed its quarterly earnings results on August 10. The
basic materials company reported $0.13 earnings per share (EPS) for
the quarter, the report says. Cosan had a net margin of 4.79% and a
return on equity of 4.77%, the report notes. The firm had revenue of
$1.14 billion for the quarter, the report relays. research analysts
anticipate that Cosan Ltd will post 1.91 EPS for the current year, the
report adds.
COSAN LTD: S&P Affirms 'BB-' Issuer Credit Rating, Outlook Stable
-----------------------------------------------------------------
S&P Global Ratings affirmed its 'BB-' issuer credit ratings on Cosan
Ltd., Cosan S.A. Industria e Comercio (Cosan S.A.), and Cosan
Lubrificantes e Especialidades S.A., a lubricant distributor
subsidiary). The outlook on all companies remains stable. 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 also 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 stable outlook reflect our
expectation that CZZ and Cosan S.A. will continue generating strong
and resilient cash flow due to the solid business position of their
subsidiaries. We also expect the group to maintain a long-term
amortization profile and robust coverage for CZZ's $500 million bond
and Cosan S.A.'s about $1.15 billion notes. We forecast a total
coverage ratio (dividends received divided by operating charges,
taxes, and net interest expense) at 1.5x-1.7x for both CZZ and Cosan
S.A., which in our view, provides the group with flexibility to
withstand potential financial volatility in dividends and earnings. In
addition, we expect the gradual recovery of Brazil's economy and the
expansion of clients' base to continue supporting Companhia de Gas de
Sao Paulo - Comgas' strong financial performance and high dividend
yield. (The group owns Comgas, a gas distributor.)"
RUMO SA: S&P Affirms 'BB-' LT Global Scale ICR, Outlook Stable
--------------------------------------------------------------
S&P Global Ratings affirmed its long-term 'BB-' and short-term 'B'
global scale issuer credit ratings on Rumo S.A. S&P also affirmed its
long-term 'brAA+' and short-term 'brA-1+' national scale ratings on
the company. The outlook on the long-term issuer credit ratings is
stable.
S&P said, "At the same time, we affirmed the 'BB-' issue-level rating
on Rumo Luxembourg S.a.r.l.'s unsecured notes guaranteed by Rumo Malha
Norte (not rated), with a recovery rating of '3', given the meaningful
expected recovery of 65%. We also affirmed the 'B+' issue-level rating
on Rumo Luxembourg S.a.r.l.'s senior unsecured notes that are
guaranteed by Rumo, the non-operating holding company. The notes are
one notch below the long-term issuer credit rating on Rumo because
their recovery rating is '5', given the modest 15% recovery
expectation that reflects the structural subordination to operating
subsidiaries' debts.
Rumo's five-year investment plan is on track. It initiated the plan in
2015 after it acquired ALL, which substantially improved its
efficiency--its operating ratio jumped to 70% from 85%. Fewer
interruptions in train hauls and larger volumes helped to boost cash
flow generation, further helped by a lower interest burden. This was
thanks to the decline in interest rates in Brazil and Rumo's debt
refinancing to extend its maturity profile and reduce debt costs,
including two capital increases where it used the proceeds to pay down
debt.
S&P said, "In general, we forecast overall cargo volumes to reach over
54 billion revenue tons per kilometer (RTK) in 2018. We expect the
company to continue increasing volumes because it's able to add
capacity to its existing portfolio amid favorable competition with
other less efficient transport modalities, such as trucks. We also
believe Rumo is able to offset the lower sugar volumes transported
(because of weak global prices) by increasing its soybean and corn
cargo, which are destined for exports. On the other hand, some
volatility in profitability is possible because of Rumo's high cargo
concentration in agricultural products, concentration of revenues in a
small portion of its network (Malha Norte), and heavy capital
expenditures (capex) plan that's ongoing for the next 12 months."
======================
P U E R T O R I C O
======================
ARQUIDIOCESIS DE SAN JUAN: Case Summary & 20 Unsecured Creditors
----------------------------------------------------------------
Debtor: Arquidiocesis de San Juan de Puerto Rico
aka Iglesia Catolica Apostolica Y Romana,
Arquidiocesis De San Juan De Puerto Rico
Antiguo Colegio Madre Cabrini
Urb. Caparra High 1564
Calle Encarnacion
San Juan, PR 00920
Business Description: Arquidiocesis de San Juan de Puerto Rico --
http://www.arqsj.org-- is an unincorporated
religious association in San Juan, Puerto
Rico.
Chapter 11 Petition Date: August 29, 2018
Court: United States Bankruptcy Court
District of Puerto Rico (Old San Juan)
Case No.: 18-04911
Judge: Hon. Edward A. Godoy
Debtor's Counsel: Carmen D. Conde Torres, Esq.
C. CONDE & ASSOC.
254 San Jose Street, 5th Floor
San Juan, PR 00901-1523
Tel: 787-729-2900
Fax: 787-729-2203
E-mail: notices@condelaw.com
condecarmen@condelaw.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Father Alberto Arturo Figueroa Morales,
vicar general.
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/prb18-04911.pdf
List of Debtor's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Banco Popular De PR As Guarantor to $6,506,425
PO Box 362708 Various Parish
San Juan, PR Loans
00936-2708
Yali Acevedo Case No. SJ2016CV00131 $4,700,000
Feliciato, Et Als Case No. SJ2016CV00143
c/o Antonio Bauza Santos Case No. SJ2016CV00156
PO Box 13369
San Juan PR 00908
Banco Popular De PR Various Loans $3,653,488
PO Box 362708
San Juan, PR
00936-2708
Nunciatura Apostolica $731,300
Villa Caparra
Executive
229 Carr. #2 Apto. 14E
Guaynabo, PR 00966
Caritas De Puerto Rico $178,190
Parroquia Madre Cabrini $150,000
Academia Nuestra SRA. De $87,460
La Providencia
Comisaria De Tierra Santa $43,743
Schuster Aguilo LLC $30,537
Cannon De Puerto Rico $21,032
Popular Auto $20,015
PREPA $10,798
The Office Shop $10,665
Rochet Consulting Group $8,860
Facilities Management $6,935
PODA Landscaping $4,680
Brisas De Canovanas
Cancio Nadal Rivera & Diaz PSC $4,468
AT&T Mobility $4,083
JRM Professional Painting $4,052
Reichard Santiago & Assoc., PSC $3,900
PUERTO RICO: GDB Modification Filing Deadline Set for Sept. 12
--------------------------------------------------------------
The Government Development Bank of Puerto Rico ("GDB") and the
Puerto Rico Fiscal Agency and Financial Advisory Authority
("AAFAF") commenced a proceeding under the Puerto Rico Oversight,
Management, and Economic Stability Act ("PROMESA") Title VI in the
United States District Court for the District Court of Puerto Rico
by filing the application of the GDB and AAFAF, pursuant to Section
601(m)(1)(D) modification, which seeks to modify certain GDB
indebtedness.
Deadline to vote to approve or reject the qualifying modification
is Sept. 12, 2018, at 5:00 p.m. (prevailing Eastern Time).
If you need a ballot, or a copy of the solicitation statement or
preliminary offering memorandum, contact Epiq Corporate
Restructuring, GDB's information and calculation agent at (646)
282-2500 or email tabulation@epiqglobal.com with "GDB" in the
subject line requesting that copy be provided to you. Copies of
the solicitation statement and preliminary offering memorandum are
also available in electronic format on the case website at
http://dm.epiq11.com/#/case/GDB/info.
GDB is a public corporation and government instrumentality of the
Commonwealth of Puerto Rico, which has acted as financial adviser
to and fiscal agent for the Commonwealth and its instrumentalities,
public corporations and municipalities. GDB has also provided interim
and long-term financing to the Commonwealth and its instrumentalities,
public corporations and municipalities, and to private parties for
economic development.
The Davis Polk insolvency and restructuring team includes partners
Donald S. Bernstein and Brian M. Resnick and associates Angela M.
Libby and Jordan Weber. The litigation team includes partner
Benjamin S. Kaminetzky and associate Marc J. Tobak. The capital
markets team includes partner Nicholas A. Kronfeld. Partner
Lawrence E. Wieman is providing credit advice. Partner Lucy W.
Farr and counsel Leslie J. Altus are providing tax advice. All
members of the Davis Polk team are based in the New York office.
Davis Polk & Wardwell LLP is a New York limited liability
partnership, and its associated entities.
About Puerto Rico
Puerto Rico is a self-governing commonwealth in association with
the United States that's facing a massive bond debt of $70 billion, a
68% debt-to-GDP ratio and negative economic growth in nine of the last
10 years.
The Commonwealth of Puerto Rico has sought bankruptcy protection,
aiming to restructure its massive $74 billion debt-load and $49
billion in pension obligations.
The debt restructuring petition was filed by Puerto Rico's
financial oversight board in U.S. District Court in Puerto Rico
(Case No. 17-01578) on May 3, 2017, and was made under Title III of
2016's U.S. Congressional rescue law known as the Puerto Rico
Oversight, Management, and Economic Stability Act ('PROMESA').
The Financial Oversight and Management Board later commenced Title
III cases for the Puerto Rico Sales Tax Financing Corporation
(COFINA) on May 5, 2017, and the Employees Retirement System (ERS)
and the Puerto Rico Highways and Transportation Authority (HTA) on
May 21, 2017. On July 2, 2017, a Title III case was commenced for
the Puerto Rico Electric Power Authority ("PREPA").
U.S. Chief Justice John Roberts has appointed U.S. District Judge
Laura Taylor Swain to oversee the Title III cases. The Honorable
Judith Dein, a United States Magistrate Judge for the District of
Massachusetts, has been designated to preside over matters that may be
referred to her by Judge Swain, including discovery disputes, and
management of other pretrial proceedings.
Joint administration of the Title III cases, under Lead Case No.
17-3283, was granted on June 29, 2017.
The Oversight Board has hired as advisors, Proskauer Rose LLP and
O'Neill & Borges LLC as legal counsel, McKinsey & Co. as strategic
consultant, Citigroup Global Markets, as municipal investment
banker, and Ernst & Young, as financial advisor.
Martin J. Bienenstock, Esq., Scott K. Rutsky, Esq., and Philip M.
Abelson, Esq., of Proskauer Rose; and Hermann D. Bauer, Esq., at
O'Neill & Borges are on-board as attorneys.
McKinsey & Co. is the Board's strategic consultant, Ernst & Young
is the Board's financial advisor, and Citigroup Global Markets Inc. is
the Board's municipal investment banker.
Prime Clerk LLC is the claims and noticing agent. Prime Clerk
maintains a case website at
https://cases.primeclerk.com/puertorico
Epiq Bankruptcy Solutions LLC is the service agent for ERS, HTA,
and PREPA.
O'Melveny & Myers LLP is counsel to the Commonwealth's Puerto Rico
Fiscal Agency and Financial Advisory Authority (AAFAF), the agency
responsible for negotiations with bondholders.
The Oversight Board named Professor Nancy B. Rapoport as fee
examiner and to chair a committee to review professionals' fees.
Bondholders' Attorneys
Kramer Levin Naftalis & Frankel LLP and Toro, Colon, Mullet, Rivera &
Sifre, P.S.C. and serve as counsel to the Mutual Fund Group, comprised
of mutual funds managed by Oppenheimer Funds, Inc., and the First
Puerto Rico Family of Funds, which collectively hold over $4.4 billion
of GO Bonds, COFINA Bonds, and other bonds issued by Puerto Rico and
other instrumentalities.
White & Case LLP and Lopez Sanchez & Pirillo LLC represent the UBS
Family of Funds and the Puerto Rico Family of Funds, which hold
$613.3 million in COFINA bonds.
Paul, Weiss, Rifkind, Wharton & Garrison LLP, Robbins, Russell,
Englert, Orseck, Untereiner & Sauber LLP, and Jimenez, Graffam &
Lausell are co-counsel to the ad hoc group of General Obligation
Bondholders, comprised of Aurelius Capital Management, LP, Autonomy
Capital (Jersey) LP, FCO Advisors LP, and Monarch Alternative Capital
LP.
Quinn Emanuel Urquhart & Sullivan, LLP and Reichard & Escalera are
co-counsel to the ad hoc coalition of holders of senior bonds
issued by COFINA, comprised of at least 30 institutional holders,
including Canyon Capital Advisors LLC and Varde Investment
Partners, L.P.
Correa Acevedo & Abesada Law Offices, P.S.C., is counsel to Canyon
Capital Advisors, LLC, River Canyon Fund Management, LLC, Davidson
Kempner Capital Management LP, OZ Management, LP, and OZ Management II
LP (the QTCB Noteholder Group).
Committees
The U.S. Trustee formed an official committee of retirees and an
official committee of unsecured creditors of the Commonwealth. The
Retiree Committee tapped Jenner & Block LLP and Bennazar, Garcia &
Milian, C.S.P., as its attorneys. The Creditors Committee tapped Paul
Hastings LLP and O'Neill & Gilmore LLC as counsel.
=================
V E N E Z U E L A
=================
PETROLEOS DE VENEZUELA: To Divert Tankers to Nearby Port
--------------------------------------------------------
Venezuela's state-run Petroleos de Venezuela S.A. is organizing a
contingency plan to address its latest oil-export problem following a
minor accident at the country's main crude terminal, two sources from
the firm told Reuters.
Marianna Parraga at Reuters reports that a tanker collision that
damaged Jose port's South dock and forced its closure has added to
delays in loading crude for export, especially to customers such as
Russia's Rosneft and U.S.-based Valero Energy Corp and Chevron Corp.
Oil tankers that were assigned to load diluted and upgraded crudes at
Jose's South dock would be diverted to neighboring Puerto la Cruz
terminal under the proposed plan, according to Reuters. Vessels will
be limited to up to 500,000 barrels each, one of the sources said, the
report relays.
PDVSA is keen to recover oil export capacity after the country's main
source of revenue fell 26 percent to 1.22 million barrels per day
(bpd) in the first half this year as production fell to historic lows,
the report notes.
The declines have crippled its economy, which is plagued with
hyperinflation, shortages of food, water and medicine, the report
relays. The port accident put new strains on PDVSA's efforts to
fulfill its supply contracts, the report discloses.
The firm earlier this year asked some customers to bring larger
tankers to cut a backlog around Jose port, the report says. Most
vessels currently waiting were expected to load over 1 million barrels
of heavy crude each, according to one of the sources and Thomson
Reuters vessel tracking data.
As reported in the Troubled Company Reporter-Latin America on
Aug. 24, 2018, S&P Global Ratings affirmed its 'SD' global scale
issuer credit rating and 'D' issue-level ratings on Petroleos de
Venezuela S.A. (PDVSA).
VENEZUELA: Colombia Urges Urgent Creation of Exodus Fund
--------------------------------------------------------
EFE News reports that Colombian Foreign Minister Holmes Trujillo said
here that the international community must urgently create a
humanitarian emergency fund to aid the exodus of Venezuelans, and also
that a special UN envoy should be designated to coordinate that
multilateral action.
Those were his principal conclusions after a two-day visit to the
Venezuelan border that ended in the frontier city of Cucuta, where he
went across the Simon Bolivar International Bridge, according to EFE
News.
According to UN estimates, close to 2.3 million Venezuelans have fled
their country because of the crisis, a situation made worse by the
closing of the Peruvian border to all whose passports have expired,
the report notes.
More that 1 million Venezuelans have settled in Colombia, and another
35,000 cross the common border every day, the report relays.
The report discloses that some make the crossing to leave their
country forever, while others go to Colombia to buy food and
medicines, which puts a lot of pressure on border communities.
With that in mind, Mr. Trujillo insisted on the importance of
understanding the regional and global magnitude of the Venezuelan
exodus, for which reason he considers that the measures to be taken
cannot be national but must a cooperative undertaking of all the
countries affected, the report says.
Mr. Trujillo also said that at the next UN General Assembly, Colombia
will promote a meeting to which countries of the area will be invited,
along with donors and multilateral financial organizations, in order
to create a humanitarian fund, the report relays.
Mr. Trujillo also recalled that he will visit Washington and later
will travel to the European Union (EU) to discuss the matter, the
report says.
On his visit, Mr. Trujillo was accompanied by the resident coordinator
of the United Nations System in Colombia, Martin Santiago, who asked
for a regional response to the crisis caused by the exodus of
Venezuela due to its scale, magnitude and consequences, the report
relays.
According to Santiago, the consequences of Venezuelans fleeing their
country "don't just affect Colombia," but rather "all the countries of
the region," which makes it necessary to find "answers to a situation
that is already exceptional," because the migration has far exceeded
the dimensions that were estimated at the beginning, the report adds.
As reported in the Troubled Company Reporter-Latin America on
June 1, 2018, S&P Global Ratings, on May 29, 2018, removed its
long- and short-term local currency sovereign credit ratings on
Venezuela from CreditWatch with negative implications and affirmed
them at 'CCC- /C'. The outlook on the long-term local currency
rating is negative. At the same time, S&P affirmed its 'SD/D'
long- and short-term foreign currency sovereign credit ratings on
Venezuela. S&P's transfer and convertibility assessment remains at
'CC'.
=================
X X X X X X X X X
=================
* BOND PRICING: For the From August 27 to August 31, 2018
----------------------------------------------------------
Issuer Name Cpn Price Maturity Country Curr
----------- --- ----- -------- ------- ---
BA-CA Finance Cayman Lt 0.518 62.07 KY EUR
AES Tiete Energia SA 6.7842 1.109 4/15/2024 BR BRL
Argentina Bogar Bonds 2 39.36 2/4/2018 AR ARS
Automotores Gildemeister 8.25 73.25 5/24/2021 CL USD
Automotores Gildemeister 6.75 67 1/15/2023 CL USD
Automotores Gildemeister 8.25 73.25 5/24/2021 CL USD
Automotores Gildemeister 6.75 65.5 1/15/2023 CL USD
CA La Electricidad 8.5 63.664 4/10/2018 VE USD
Caixa Geral De Depositos 1.439 63.167 KY EUR
Caixa Geral De Depositos 1.469 KY EUR
CSN Islands XII Corp 7 68 BR USD
CSN Islands XII Corp 7 66.266 BR USD
Decimo Primer Fideicomiso 6 53.225 10/25/2041 PA USD
Decimo Primer 4.54 43.127 10/25/2041 PA USD
Dolomite Capital 13.217 73.108 12/20/2019 CN ZAR
Enel Americas SA 5.75 56.172 6/15/2022 CL CLP
Gol Linhas Aereas SA 10.75 35.861 2/12/2023 BR USD
Gol Linhas Aereas SA 10.75 35.601 2/12/2023 BR USD
Inversora Electrica 6.5 67.625 9/26/2017 AR USD
Inversora Electrica 6.5 67.625 9/26/2017 AR USD
MIE Holdings Corp 7.5 64.78 4/25/2019 HK USD
MIE Holdings Corp 7.5 64.982 4/25/2019 HK USD
NB Finance Ltd 3.88 61.816 2/7/2035 KY EUR
Noble Holding 7.7 74.433 4/1/2025 KY USD
Noble Holding 5.25 56.279 3/15/2042 KY USD
Noble Holding 8.7 71.881 4/1/2045 KY USD
Noble Holding 6.2 60.129 8/1/2040 KY USD
Noble Holding 6.05 58.38 3/1/2041 KY USD
Odebrecht Finance Ltd 7.5 42.5 KY USD
Odebrecht Finance Ltd 5.125 56.938 6/26/2022 KY USD
Odebrecht Finance Ltd 7 68.053 4/21/2020 KY USD
Odebrecht Finance Ltd 7.125 41.366 6/26/2042 KY USD
Odebrecht Finance Ltd 4.375 40.002 4/25/2025 KY USD
Odebrecht Finance Ltd 5.25 39.211 6/27/2029 KY USD
Odebrecht Finance Ltd 6 44.75 4/5/2023 KY USD
Odebrecht Finance Ltd 5.25 39.018 6/27/2029 KY USD
Odebrecht Finance Ltd 7.5 42.95 KY USD
Odebrecht Finance Ltd 4.375 40.363 4/25/2025 KY USD
Odebrecht Finance Ltd 7.125 41.635 6/26/2042 KY USD
Odebrecht Finance Ltd 6 52.625 4/5/2023 KY USD
Odebrecht Finance Ltd 5.125 55.873 6/26/2022 KY USD
Odebrecht Finance Ltd 7 67.368 4/21/2020 KY USD
Petroleos de Venezuela 8.5 74.5 10/27/2020 VE USD
Petroleos de Venezuela 6 30.458 5/16/2024 VE USD
Petroleos de Venezuela 6 30.517 11/15/2026 VE USD
Petroleos de Venezuela 9.75 35.677 5/17/2035 VE USD
Petroleos de Venezuela 9 39.279 11/17/2021 VE USD
Petroleos de Venezuela 5.375 30.267 4/12/2027 VE USD
Petroleos de Venezuela 8.5 72.5 10/27/2020 VE USD
Petroleos de Venezuela 12.75 45.278 2/17/2022 VE USD
Petroleos de Venezuela 6 30.367 5/16/2024 VE USD
Petroleos de Venezuela 6 30.387 11/15/2026 VE USD
Petroleos de Venezuela 9 39.316 11/17/2021 VE USD
Petroleos de Venezuela 9.75 35.893 5/17/2035 VE USD
Petroleos de Venezuela 6 28.346 10/28/2022 VE USD
Petroleos de Venezuela 5.5 30.123 4/12/2037 VE USD
Petroleos de Venezuela 12.75 45.23 2/17/2022 VE USD
Polarcus Ltd 5.6 75 3/30/2022 AE USD
Provincia del Chubut 4 10/21/2019 AR USD
Siem Offshore Inc 4.04527 69.5 10/30/2020 NO NOK
Siem Offshore 3.75176 65.75 12/28/2021 NO NOK
STB Finance 2.05771 56.243 KY JPY
Sylph Ltd 2.367 64.438 9/25/2036 KY USD
US Capital 1.63611 54.774 12/1/2039 KY USD
US Capital 1.63611 54.774 12/1/2039 KY USD
USJ Acucar 9.875 67 11/9/2019 BR USD
USJ Acucar 9.875 67 11/9/2019 BR USD
Venezuela 13.625 68.25 8/15/2018 VE USD
Venezuela 7.75 44.065 10/13/2019 VE USD
Venezuela 11.95 40.785 8/5/2031 VE USD
Venezuela 12.75 45.19 8/23/2022 VE USD
Venezuela 9.25 39.645 9/15/2027 VE USD
Venezuela 11.75 40.005 10/21/2026 VE USD
Venezuela 9 36.285 5/7/2023 VE USD
Venezuela 9.375 37.69 1/13/2034 VE USD
Venezuela 13.625 72.25 8/15/2018 VE USD
Venezuela 7 34.23 3/31/2038 VE USD
Venezuela 7 59.19 12/1/2018 VE USD
***********
Monday's edition of the TCR-LA delivers a list of indicative
prices for bond issues that reportedly trade well below par.
Prices are obtained by TCR-LA editors from a variety of outside
sources during the prior week we think are reliable. Those
sources may not, however, be complete or accurate. The Monday
Bond Pricing table is compiled on the Friday prior to publication.
Prices reported are not intended to reflect actual trades. Prices
for actual trades are probably different. Our objective is to
share information, not make markets in publicly traded securities.
Nothing in the TCR-LA constitutes an offer or solicitation to buy
or sell any security of any kind. It is likely that some entity
affiliated with a TCR-LA editor holds some position in the
issuers' public debt and equity securities about which we report.
Tuesday's edition of the TCR-LA features a list of companies with
insolvent balance sheets obtained by our editors based on the
latest balance sheets publicly available a day prior to
publication. At first glance, this list may look like the
definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
Submissions about insolvency-related conferences are encouraged. Send
announcements to conferences@bankrupt.com
***********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter-Latin America is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Fairless
Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C.,
USA, Marites O. Claro, Joy A. Agravante, Rousel Elaine T.
Fernandez, Psyche A. Castillon, 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.
* * * End of Transmission * * *