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       T R O U B L E D   C O M P A N Y   R E P O R T E R

                 L A T I N   A M E R I C A

          Friday, May 3, 2019, Vol. 20, No. 89

                           Headlines



A R G E N T I N A

ARGENTINA: Prospect of Fernandez Comeback Getting More Noise


B R A Z I L

ARCOS DORADOS: Fitch Affirms BB+ LongTerm IDR & Unsec. Notes Rating
BANCO DAYCOVAL: Fitch Affirms LT IDRs at 'BB-', Outlook Stable
BANCO ORIGINAL: Fitch Affirms LT IDRs at 'B+', Outlook Negative
BANCO PINE: Fitch Cuts Long-Term IDR to 'B', Outlook Negative
COMPANHIA DE SANEAMENTO: Fitch Affirms 'BB' LT IDR, Outlook Stable

OI SA: Posts BRL27.39 Billion Profit for 2018 Fiscal Year
VOTORANTIM CIMENTOS: Moody's Hikes CFR to Ba1, Outlook Positive
VOTORANTIM SA: Moody's Hikes $750MM Senior Unsecured Notes to Ba1
VOTORANTIM SA: Moody's Hikes CFR to Ba1 & Alters Outlook to Pos.


C O L O M B I A

COLOMBIA: Economy is Gaining Momentum, IMF Says


D O M I N I C A N   R E P U B L I C

DOMINICAN REPUBLIC: Cedes US$182 Million to Renewable Energy
[*] DOMINICAN REPUBLIC: Expert Puts Numbers on Construction Boom


P A R A G U A Y

PARAGUAY: Exports Affected by Economic Crisis in Argentina


P U E R T O   R I C O

SEARS HOLDINGS: Chapter 11 Plan Incorporates $80MM PBGC Deal

                           - - - - -


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A R G E N T I N A
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ARGENTINA: Prospect of Fernandez Comeback Getting More Noise
------------------------------------------------------------
Benedict Mander, Colby Smith and John Paul Rathbone at The
Financial Times reports that when investors dumped Argentine bonds
en masse just as copies of Cristina Fernandez de Kirchner's
autobiography Sincerely began to fly off the shelves, it gave new
meaning to the term "bestseller".

The asset sell-off took place as all emerging markets were
suffering from the strengthening US dollar, according to The
Financial Times.  But the enthusiastic reception for the populist
former president's memoirs -- hard on the heels of polling showing
her popularity rising -- gave investors one more reason to fret
about her possible return to power at presidential elections in
October, the report notes.

"People woke up to the fact that Cristina could run," said Alejo
Czerwonko, emerging markets strategist at UBS Global Wealth
Management, the report notes discloses.

Until recently, most investors believed the re-election of Mauricio
Macri, Argentina's market-friendly president, was assured, the
report notes says.  But that changed after last year's currency
crisis wrought havoc on the economy and forced Mr. Macri to ask for
a $56.3 billion bailout from the IMF, the report notes relates.

The report notes that although most pollsters note that the October
election is too far off to make reliable predictions, the mere
possibility Ms. Fernandez could win is focusing investors' minds on
what that could mean for Argentina's IMF-backed austerity programme
and the country's sovereign debt.

"If you think about Cristina's record, most reasonable people would
say there is no chance she could ever win another election," said
one international investor who manages a large emerging market debt
fund, Mr. Marci said, the report relates.  "But this being
Argentina, that is not the case," he added.

Ms. Fernandez has not yet declared her intention to run. But her
book contains possible clues, the report discloses.

"If someone asked me to define Mauricio Macri in just one word, the
only one that occurs to me is: chaos," she writes. "Mauricio Macri
is chaos, and that is why I firmly believe that it is necessary to
restore order to Argentina," she added.

In the final paragraph, she writes: "The deterioration caused by
the policies of Mauricio Macri and [his coalition] Cambiemos has
been too great, vertiginous and deep to think that just a few can
fix this," adding: "We cannot go on like this," the report notes.

Some of the book seeks to explain why the multiple charges she
faces -- including bribery, embezzlement and money laundering --
are unfair and amount to political persecution, the report relates.
If elected president, Ms. Fernandez, who is a senator, would
maintain legal immunity and could not be imprisoned, the report
adds.

Should she announce a run before the deadline of June 22, polls
suggest she stands a good chance of victory, the report notes.

In an Isonomia survey last week, 45 per cent of respondents said
they would vote for Ms. Fernandez in a run-off against Mr. Macri,
the report says.  Only 36 per cent said they would back the
president, and almost 20 per cent were undecided, the report adds.

The problem for Mr. Macri is that on nearly every economic metric,
including inflation and growth, the situation is worse than before
he took office, the report notes.  Inflation is running at almost
55 per cent, more than double the 27 per cent rate in 2015, the
report says.

"For the average Argentine, things have not gotten better in the
last few years, and that is why Cristina still has a chance," the
international investor said, the report relays.

Investor concerns over a possible Fernandez government centre on
her interventionist economic policies after she took power in 2007,
the report discloses.

These included nationalizations, accusations of bullying private --
sector companies -- her commerce secretary, Guillermo Moreno, once
took boxing gloves to a meeting of shareholders of a key newsprint
company in which the state had a stake, to show who was boss -- and
a bitter dispute with "holdout" bondholders who refused to accept a
debt restructuring, the report notes.  The economy was on the brink
of a balance of payments crisis when she left office in 2015, the
report relays.

But if Ms Fernandez did win, economists note, she would have less
room for manoeuvre than during her previous term, when a global
commodity boom sent the price of soya, Argentina's top export, to a
high, the report notes.

She may already be preparing to contend with Argentina's economic
woes, the report discloses.  Axel Kicillof, her radical leftist
former economy minister, is widely understood to have met IMF
officials secretly recently and assured them that a Fernandez
government would continue with a program the former president
described as "tragic and incredible" in her book, the report says.

But some analysts say that with polling inconclusive and the
election still some way off, much could change -- including an
economic recovery that would favor Mr. Macri -- and that it is too
early to suggest Argentina will return to populism, the report
adds.

Graham Stock, head of emerging market sovereign research at BlueBay
Asset Management, believes this is unlikely -- although Mr. Macri
himself has recently turned to interventionist policies, such as
the price controls imposed this month aimed at curbing runaway
inflation, the report relates.

"There's an overblown fear that Cristina will win. It is easy for
poll responders to say they are voting for Cristina because she
doesn't have any policies, and it is an easy expression of protest
against the Macri government," he said, the report notes.  "But
when they are standing in the electoral booths in October, the
choice may feel rather different," he added.

                 About Argentina

As reported in the Troubled Company Reporter-Latin America, S&P
Global Ratings in June 2018 affirmed its 'B+' long-term sovereign
credit ratings on the Republic of Argentina. S&P's long-term
sovereign credit ratings on Argentina was raise to 'B+' from 'B' in
October 2017. The outlook on the long-term ratings remains stable.

In May 2018, Fitch Ratings affirmed Argentina's Long-Term
Foreign-Currency Issuer Default Rating (IDR) at 'B' and revised the
Outlook to Stable from Positive.

In December 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. Moody's said the key drivers of the upgrade of
the rating to B2 are: (1) a record of macro-economic reforms that
are beginning to address long existing distortions in Argentina's
economy; and (2) the likelihood that reforms will continue and in
turn sustain the recent return to positive economic growth.

The stable outlook on Argentina's B2 ratings balances Argentina's
credit strengths of its large, diverse economy and moderate income
levels against the credit challenges posed by still high fiscal
deficits and a reliance on external financing, which increases its
vulnerability to external event risk, said Moody's.

Back in July 2014, Argentina defaulted on some of its debt, after
expiration of a 30-day grace period on a US$539 million interest
payment.  Earlier that day, 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.




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B R A Z I L
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ARCOS DORADOS: Fitch Affirms BB+ LongTerm IDR & Unsec. Notes Rating
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Fitch Ratings has affirmed Arcos Dorados Holdings Inc.'s Long-Term
Foreign Currency Issuer Default Rating and senior unsecured notes
at 'BB+'. The Rating Outlook is Stable.

KEY RATING DRIVERS

Negative FCF Expected: Fitch expects Arcos Dorados to generate
negative FCF in 2019 due to increased capex and ongoing dividends.
The company reported resilient EBITDA despite lethargic consumer
growth, currency depreciation, the challenging operating
environment in the regions and intensifying competition. The
company reported EBITDA (excluding Venezuela) of about USD292
million (USD258 million including Venezuela) in 2018 versus EBITDA
of about USD282 million in 2017 (USD 305 million including
Venezuela) due to cost controls and positive systemwide comparable
sales growth (7.6% yoy). Arcos Dorados reported negative FCF of
USD38 million due to increased capex, dividends and USD46 million
of share buybacks. Fitch's base case scenario incorporates a period
of higher capex due to the agreed renovation and expansion plan
with McDonald's Corporation (BBB/Stable). Fitch expects
lease-adjusted net leverage to increase toward 3.7x-3.8x from about
3.6x (including Venezuela) due to increased capex.

Country Ceiling: Arcos Dorados is headquartered in Argentina
(B/Negative), but its cash flow generation is heavily concentrated
in Brazil, which accounted for 44% of revenues and 69% of EBITDA in
2018. The Long-Term Foreign Currency IDR is not constrained by
Brazil's Country Ceiling, given the company's ability to cover hard
currency debt service with cumulative cash flow from higher-rated
countries such as Chile, Mexico, Colombia, Uruguay, and Panama.

Solid Business Profile: Arcos Dorados' ratings reflect a solid
business position as the sole franchisee of McDonald's restaurants
across Latin America. The company operates or franchises 2,223
McDonald's restaurants and 266 McCafes in 20 countries as of YE
2018. Arcos Dorados benefits from the iconic McDonald's brand but
faces various regional economic challenges. About 69% of these
restaurants are operated by Arcos Dorados, while the remainder are
franchised restaurants as of December 2018.

Expansion: Arcos Dorados has the exclusive right to own, operate
and grant franchises for McDonald's restaurants in 20 Latin
American and Caribbean countries and territories. Fitch expects
Arcos Dorados to increase capex to about USD300 million in 2019
from USD197 million in 2018. Capex is mainly related to openings
and stores modernization - primarily in Brazil. The company set a
target of 650 experience of the future restaurants by the end of
2019, an increase from 329 as of FYE18. Fitch expects capex to be
financed by internal cash flow and cash and cash equivalent.

McDonald's Franchise Strength: The ratings also incorporate the
strength of McDonald's as a franchisor and the longstanding
relationship with Arcos Dorados' owners and management. The master
franchise agreement sets strict strategic, commercial and financial
guidelines for Arcos Dorados' operations, which support the
operating and financial stability of the business and the
underlying value of the McDonald's brand in the region.

DERIVATION SUMMARY

Arcos Dorados' ratings reflect its solid business position as the
sole franchisee of McDonald's restaurants across Latin America.
Arcos Dorados benefits from the iconic McDonald's brand yet is
confronted by several economic challenges facing the region. Most
of Arcos Dorados' EBITDA is generated in Brazil. The company's
geographical diversification and presence in several countries in
Latin America outside of Brazil and Argentines support the Foreign
Currency IDR.

The business profile is constrained by the company's smaller size
relative to its international peers such as McDonald's
(BBB/Stable), Starbucks Corporation (BBB+/Stable) and Darden
Restaurants, Inc. (BBB/Stable). The company also reported lower
profitability than its peers due to its presence in less mature
countries. The company's leverage is in line with the 'BB' rating
category and the liquidity remains strong due to its long-term debt
maturity profile.

KEY ASSUMPTIONS

Fitch's Key Assumptions Within Its Rating Case for the Issuer

  -- EBITDA margin of about 9%;

  -- Capex of USD300 million in 2019;

  -- USD23 million of dividend payments in 2019;

  -- Lease-adjusted net leverage moving toward 3.7x -3.8x by 2019.

RATING SENSITIVITIES

Developments That May, Individually or Collectively, Lead to
Positive Rating Action

  -- The ratings could be positively affected by higher than
expected cash generation from investment-grade countries as well as
an improvement in leverage metrics, such as net lease-adjusted debt
levels below 3.0x on a sustained basis.

Developments That May, Individually or Collectively, Lead to
Negative Rating Action

  -- Failure to comply with the terms of the MFA;

  -- Consolidated net lease adjusted debt/EBITDAR above 4.0x on a
sustained basis;

  -- While a one-notch downgrade of Brazil's sovereign rating is
unlikely to cause a downgrade for Arcos Dorados, a multi-notch
downgrade of Brazil's sovereign rating likely would.

LIQUIDITY

Adequate Liquidity: Fitch views Arcos Dorados' liquidity as
adequate due to its cash position, committed bank lines and
diversified debt maturity profile. Most of the company's debt
consists of two U.S. notes maturing in 2023 and 2027. The company
had USD197 million in cash and cash equivalents as of Dec. 31,
2018, and USD50 million of undrawn committed revolving credit
facility with Bank of America and JP Morgan. Most of the company's
debt is long term. The company is exposed to currency exchange with
about 53% of debt U.S. dollar-denominated and 47% in local currency
(mainly Brazilian reals) post currency swaps.

FULL LIST OF RATING ACTIONS

Fitch has affirmed the following ratings:

Arcos Dorados Holdings Inc.

  -- Long-Term Foreign Currency IDR at 'BB+';

  -- USD473 million senior unsecured notes due 2023 at 'BB+';

  -- USD265 million senior unsecured notes due 2027 at 'BB+.

The Rating Outlook is Stable.


BANCO DAYCOVAL: Fitch Affirms LT IDRs at 'BB-', Outlook Stable
--------------------------------------------------------------
Fitch Ratings has affirmed Banco Daycoval S.A.'s Long-Term,
Foreign- and Local-Currency Issuer Default Ratings at 'BB-'. The
Rating Outlook is Stable.

Daycoval's IDRs are driven by its Viability Rating, which Fitch
also affirmed at 'bb-'. The Stable Outlook of the IDRs mirrors the
Outlook of Brazil's sovereign rating (BB-/Stable). Fitch also
affirmed Daycoval's Long-Term National Rating at 'AA(bra)' with a
Stable Outlook.

KEY RATING DRIVERS

VR, IDRS AND NATIONAL RATINGS

The affirmation of Daycoval's VR, IDRs and National Ratings
reflects the bank's solid company profile, underpinned by a stable
franchise and business diversification that is relatively higher
than other midsized banks in Brazil, consistent and strong
performance track record maintained through the cycles, and
comfortable capitalization. It also reflects the bank's
conservative asset and liability management and strong liquidity,
which would mitigate risks arising from a potential volatility in
its wholesale based funding structure. Daycoval's VR, and
consequently IDRs, remain constrained by the sovereign rating, as
the bank does not have the characteristics required from a bank to
be rated above the sovereign. The bank's VR also captures the
limitations imposed by the operating environment.

Daycoval's main focus remains SME lending and payroll deductible
loans, which made up 69% and 26% of total loans, respectively, as
of December 2018. The bank's asset quality indicators have remained
largely stable through the cycles, including during the 2015-2016
recession. In 2018, impaired loans (those classified in the D-H
range of the central bank's risk scale) declined to 6.90% as of
December 2018 (7.10% in 2017), while non-performing loans (NPLs)
above 90 days remained low at 2.4% in the same period (2.9% in
2017). The bank continued to post solid profitability through
December 2018.

The bank's bottom-line profitability ratios are higher than the
average of similarly rated peers, due to its higher net interest
margin that comfortably offsets its relatively higher impairment
charges. Fitch expects the bank's solid performance to continue in
2019 and operating profit/risk weighted assets (RWA) ratio not to
deviate significantly from the 3.68% average observed in 2014-2018.
As of December 2018, operating profit/RWA rose to a high 4.5% (3.9%
in 2017) as a result of an increase of revenues and decrease of
funding costs.

Daycoval has a strong capital structure that is 96% made up of Core
Equity Tier 1 capital. The remaining part was made up of Tier 2
subordinated instruments issued in 2018. The effect of the gradual
implementation of Basel III requirements has been immaterial and
prudential adjustments are very small. The bank's Fitch core
capital ratio fell to 13.90% at December 2018, from 14.70% at
December 2017, due to significant RWA growth (+14%). In 2018,
dividend payout fell to 30% from 36% in 2017 and 47% in 2016. Fitch
expects the company's FCC ratio to remain adequate over the one- to
two-year time horizon, due to robust earnings.

Daycoval has a wholesale-based but highly stable and relatively
diversified funding base. As of December 2018, local funding mainly
consisting of deposits and financial bills (letras financeiras)
made up 76% of total funding. Daycoval's liquidity has historically
been very comfortable, and free liquid assets totaled BRL3.6
billion as of December 2018, which corresponded to 25% and 29% of
total and local funding, respectively. In the same period, the
loans-to-deposits ratio (adjusted for the local financial bills)
corresponded to 126% (136% in December 2017).

Daycoval's asset and liability management is also adequate. As of
December 2018, the average maturity of the loan portfolio was 308
days, compared with 379 days of the funding base.

SUPPORT RATING AND SUPPORT RATING FLOOR

Daycoval's Support Rating and Support Rating Floor were affirmed at
'5' and 'NF', respectively, reflecting the bank's low systemic
importance and Fitch's view that external support, should the need
arise, cannot be relied upon.

RATING SENSITIVITIES

VR, IDRS AND NATIONAL RATINGS

Changes in Sovereign Ratings and Outlook: Daycoval's VR and IDRs
remain constrained by the sovereign ratings. A sovereign rating
downgrade or a revision of the sovereign Rating Outlook to Negative
would result in a similar action on Daycoval's VR and long-term
IDRs. A sovereign rating upgrade or a revision of its outlook to
Positive could lead to a review of Daycoval's long-term IDRs.

Deterioration in Profitability and Capitalization: Daycoval's IDRs
and VR would be negatively affected by a severe deterioration in
earnings that led to a fall in the operating profit/RWA ratio to
below 2% and/or if the FCC ratio remains below 12% on a sustained
basis.

NATIONAL RATINGS

Changes in Daycoval's IDRs or in the bank's credit profile relative
to its Brazilian peers could result in changes in its national
ratings. However, considering the relatively high rating level and
local relativities, there is very limited upside potential for the
national scale ratings over the foreseeable future.

SUPPORT RATING AND SUPPORT RATING FLOOR

A potential upgrade of Daycoval's Support Rating and Support Rating
Floor is unlikely, reflecting the low probability that the bank's
systemic importance would increase materially.

Fitch has affirmed Daycoval's ratings as follows:

  -- Long-Term Foreign- and Local-Currency IDRs at 'BB-'; Outlook
Stable;

  -- Short-Term Foreign- and Local-Currency IDRs at 'B';

  -- Viability Rating at 'bb-';

  -- Long-Term National Rating at 'AA(bra)'; Outlook Stable;

  -- Short-Term National Rating at 'F1+(bra)';

  -- Support Rating at '5';

  -- Support Rating Floor at 'NF'.


BANCO ORIGINAL: Fitch Affirms LT IDRs at 'B+', Outlook Negative
---------------------------------------------------------------
Fitch Ratings has affirmed Banco Original S.A.'s long-term foreign
and currency Issuer Default Ratings at 'B+', viability rating at
'b+' and long-term National Rating at 'BBB(bra)'. The Outlook for
all of the long-term ratings remains Negative.

KEY RATING DRIVERS

VR, IDRS, NATIONAL RATINGS

The affirmation of Original's ratings primarily reflects Fitch's
company profile for the bank, which includes its concentrated
business model and relatively small franchise and that the bank is
still in a consolidation phase. The affirmation and Negative
Outlook also reflect Original's negative operating results and
mirror Fitch's expectations for ongoing profitability weakness
relative to the bank's peers.

Original's IDRs remain driven by its VR and do not take into
account any expected parental support, although support from J&F
Investimentos S.A. since 2016 has meant that the bank was able to
offset large operating losses and post modest but positive earnings
and that its capital base was partially preserved. Potential
contagion and reputational risks from the ongoing investigation of
Original's sister company JBS S.A. (long-term local and foreign
currency IDRs BB-/Outlook Stable) and their shareholders remain,
although the bank's refinancing risks have declined significantly
in 2018.

Original continues to focus on wholesale lending, while developing
its retail banking business through its digital platform and, since
2Q18, the use of third-party correspondents. The bank has recently
adopted a set of new strategic objectives that will lead the bank
to extend its digital banking to new types of clients, including
small businesses, to establish new partnerships with acquiring
companies and fintechs and to make use of an open-banking model.
The bank expects the new strategy to yield positive results from
the second half of 2019 onwards and targets a full-year operating
break-even in 2020. Fitch believes that it will take some time for
the digital banking area of the bank to become a core business with
recurring earnings generation.

Fitch believes profitability is the weakest rating driver for
Original. In December 2018, Original reported a modest but positive
net income, despite the operating loss that was equivalent to
negative 1.6% of risk-weighted assets (negative 0.7% in 2017). The
bank's operating losses would have been much larger in the absence
of impaired loan sales to J&F in 2017 and 2018 that resulted in
substantial loan recoveries and loan loss allowance reversals. In
2018, Original's bottom-line earnings also benefitted from the sale
of 80% of its insurance brokerage subsidiary to J&F resulting in a
pre-tax gain of BRL177 million. The bank's holdings of JBS shares
(18% of bank's equity in 2018) could add further volatility to
earnings.

Original's asset quality ratios benefited from the impaired loan
sales in 2017. In 2018, as the bulk of the loan sales referred to
written-off loans, there was no effect on asset quality. At
December 2018, loans classified in the D-H categories of the
central bank and non-performing loans (NPLs) over 90 days stood at
4.7% and 2.0% of gross loans respectively.

Original's capitalization remains adequate due to the measures
taken by the shareholders. At December 2018, common equity tier 1
(CET1) and total regulatory capital ratios stood at 13.60%, while
the Fitch Core Capital ratio was 16.52%.

Original's funding and liquidity profile remains stable. However,
the bank's funding base is highly concentrated in a few
brokers/distributors, which, in turn, distribute the bank's funding
products to a wide range of smaller investors. This concentration
risk makes the bank sensitive to any negative developments
regarding the reputation of the group. The bank's loan-to-deposits
ratio adjusted for the local deposit-like products stood at a sound
75% in December 2018.

SUPPORT RATING AND SUPPORT RATING FLOOR

Original's SR and SRF were affirmed at '5' and 'NF', respectively,
in view of the bank's low systemic importance. In Fitch's view,
external support cannot be relied upon.

RATING SENSITIVITIES

VR, IDRS and NATIONAL RATINGS

Original's ratings could be negatively affected by the emergence of
additional pressures on its business and financial profiles.
Original's ratings would be negatively affected if the bank's
recurring operating profit generation capacity does not improve
during 2019, or if losses lead to a material decline in the bank's
total regulatory capital ratio to below 12%.

Original's national ratings could also be affected by changes in
the bank's credit profile relative to its local peers.

The Negative Outlook on the ratings could be revised to Stable if
the bank demonstrates that it is on track to reach and maintain
positive operating earnings in 2019 and if contagion and
reputational risks decline.

SUPPORT RATING AND SUPPORT RATING FLOOR

A potential upgrade of Original's Support Rating and Support Rating
Floor is unlikely in the foreseeable future, since this would arise
only from a material gain in systemic importance.

Fitch has affirmed Original's ratings as follows:

  -- Long-Term Foreign and Local Currency IDRs at 'B+', Outlook
Negative;

  -- Short-Term Foreign and Local Currency IDRs at 'B';

  -- Viability Rating at 'b+';

  -- National Long-Term Rating at 'BBB (bra)', Outlook Negative;

  -- National Short-Term Rating at 'F2(bra)';

  -- Support Rating at '5';

  -- Support Rating Floor at 'NF'.


BANCO PINE: Fitch Cuts Long-Term IDR to 'B', Outlook Negative
-------------------------------------------------------------
Fitch Ratings has downgraded Banco Pine S.A.'s Viability Rating to
'b' from 'b+' and its Long-Term Foreign- and Local-Currency Issuer
Default Ratings to 'B' from 'B+'; with a Negative Rating Outlook.
At the same time, Pine's Long-Term National Rating is downgraded to
'BBB-(bra)' from 'BBB+(bra)' and the Short-Term National Rating to
'F3(bra)' from 'F2(bra)'. The Long-Term Rating Outlooks are
Negative.

KEY RATING DRIVERS

IDRS, VR AND NATIONAL RATINGS

The downgrade of Pine's ratings reflect Fitch's assessment of the
bank's challenges in implementing its new business model, along
with operating losses, all factors being impacted by the still
uncertain operating environment and the negative impact of the
bank's former credit portfolio.

The Negative Outlook on the LT IDR and the National Ratings reflect
the challenges the bank is facing in originate loans under the new
strategy and to revert the negative operating profitability
allowing it to re-establish its internal capital generation in
order to support future growth.

Operating profitability, which is one of the main drivers of these
ratings, remains negative mainly due to operations originated under
the former strategy of large corporate loans, however, loans
originated under the new strategy of lower-tickets and short-tenors
with higher spreads to a wider customer base are on a positive
trend. The bank continues its efforts to reduce its credit
concentration risks and to further diversify its sources of revenue
and recompose its capital base.

Pine's VR and IDR also take into account its ample liquidity and
funding structure which is broadly based on pulverized deposits
from individuals which reduces the level of its higher cost funding
and is less confidence sensitive in comparison to institutional
investors. As of Dec. 31, 2018, the bank reported a cash and cash
equivalent balance of BRL1.9 billion (approximately 20% of total
assets). Management advised that they will be using a portion of
this excess liquidity to retire certain short-term debt and reduce
interest expenses and other related costs, as well as to reduce the
bank's leverage metrics.

Pine's management of its asset quality remains challenging due to
negative effects of its legacy portfolio, all of them classified
between 'E'-'H'. Impaired loan ratio (credits classified as
'D'-'H') remains high on annual basis comparison, reaching 21.6% as
of Dec. 31, 2018, while net charge offs and foreclosed assets also
had increased in 2018. Of note, non-performing loans over 90 days
reduced from 4.1% at the end of 2017 to 0.9% at the end of 2018,
such reduction was due to write-offs and renegotiations done
through 2018. Despite the impaired loan ratio metric being worse
than peers, relevant loan-loss provisioning of the legacy
portfolio, tighter underwriting standards and the smaller average
size of the new credit transactions provide support of its view
that asset quality metrics are likely to progress in a positive
direction.

As of Dec. 31, 2018, the bank's Fitch Core Capital (FCC) ratio
reduced to 11.6% from 11.8% as of Dec. 31, 2017, due in part to
deduction related to social security tax rate to 15% from 20% and
also accumulated losses in the period. The regulatory Tier I ratio
also reduced to 11.9% at Dec. 31, 2018, even with risk-weighted
assets reduction.

SUPPORT RATING AND SUPPORT RATING FLOOR

The bank's Support Rating and Support Rating Floor reflect Fitch's
belief that the bank is not considered a significant financial
institution locally because of the size of its market share in
deposits and credits. Thus, it is unlikely to receive external
support from the Brazilian sovereign.

A potential upgrade of Pine's Support Rating and Support Rating
Floor is unlikely in the foreseeable future, since this would arise
only from a material gain in systemic importance.

RATING SENSITIVITIES

IDRS, VR AND NATIONAL RATINGS

Pine's ratings could be downgraded in case of further deterioration
in its performance (negative operating profit-to-risk-weighted
assets) and/or a deterioration in capitalization (FCC falling below
11%), and/or asset quality deterioration (non-preforming loans over
90 days remaining above 3%).

A revision of the Outlook to Stable is contingent on significant
improvements in operating profitability and the impaired loan
ratio, which largely depends on a more stable operating
environment. Specifically from a sustained reduction of credit
impairments and its over 90 days non-performing loans ratio below
3% and a sustained FCC above 12%.

Fitch has taken the following rating actions:

  -- Long-Term Foreign- and Local-Currency IDRs downgraded to 'B'
from 'B+'; Outlook Negative;

  -- Short-Term Foreign- and Local-Currency IDRs affirmed at 'B';

  -- Viability Rating downgraded to 'b' from 'b+';

  -- Support Rating affirmed at '5';

  -- Support Rating Floor affirmed at 'No Floor';

  -- National Long-Term Rating downgraded to 'BBB-(bra)' from
'BBB+(bra)'; Outlook Negative;

  -- National Short-Term Rating downgraded to 'F3(bra)' from
'F2(bra)'.


COMPANHIA DE SANEAMENTO: Fitch Affirms 'BB' LT IDR, Outlook Stable
------------------------------------------------------------------
Fitch Ratings has affirmed Companhia de Saneamento Basico do Estado
de Sao Paulo's Long-Term Foreign and Local Currency Issuer Default
Ratings at 'BB' and its National Long-Term rating at 'AA(bra)'. The
Rating Outlook is Stable.

Sabesp's IDRs reflect the low business risk associated with its
near monopolistic position as a provider of an essential utility
within its concession area, as well as the economies of scale
obtained as the largest basic sanitation company in the Americas by
number of customers. These characteristics, combined with its
mature operations, allow Sabesp to present predictable operational
cash flow generation and strong EBITDA margins, although some
reduction is expected for the next two years. The company's credit
profile also benefits from its conservative capital structure,
robust liquidity position and manageable debt maturity schedule.

Fitch views Sabesp's expected negative FCF due to its significant
capex plans and material FX debt exposure as limiting rating
factors. The assessment also reflects the still-developing
regulatory environment for Sabesp, the intrinsic hydrological risk
of its business and the political risk associated with its position
as a state-owned company subject to the potential changes in
management and strategy after each election for the government of
the State of Sao Paulo.

The Stable Outlook reflects Fitch's expectation that the
water/wastewater industry will continue to preserve solid
fundamentals and that Sabesp will sustain its strong credit
metrics, with net adjusted leverage below 2.5x over the next three
years. The company should present adequate tariff adjustments that,
combined with moderate growth in water and sewage volumes billed in
the coming years, reduce the negative impact of the capex increase
on credit metrics.

Per Fitch's Government Related Entity Criteria, Fitch assesses
Sabesp on a standalone basis given the agency's perception of
reduced incentive of its major shareholder to provide company
support if needed given minimum financial implication for the state
of Sao Paulo in the case of Sabesp's default and limited evidence
of the state providing support track record neither expectations.
Sabesp's activities are independent from its major shareholder both
financially and operationally. Fitch also considers moderate the
social-political implications for the state in the case of the
company's default, despite the strong assessment of its status,
ownership and control by the state of Sao Paulo.

KEY RATING DRIVERS

Reduced Business and Industry Risks: Sabesp's credit profile
benefits from resilient demand even during a distressed economic
environment. This is due to its provision of an essential service
to the population under long-term contracts within 339
municipalities in addition to operations on 35 municipalities
without agreement all in the State of Sao Paulo. Fitch expects
billed volume growth as the company expands its number of water and
sewage connections. Its activity in the State of Sao Paulo, which
has the country's largest GDP, is viewed as positive. The company's
adequate tariff increases have maintained the economic and
financial balance of its operating agreements as noted on its
relevant profitability, despite the developing regulatory
environment, which is important to support its capital intensive
activity.

Strong EBITDA Margins: Sabesp's high operational scale is one of
the pillars for the company to achieve EBITDA margins above its
state-owned peers in Brazil. Fitch believes EBITDA margin will
remain strong despite expected reduction to around 40% in 2019 and
2020, from 46% in 2018, due to increase on operating expenses,
mainly related with payment of voluntary redundancy scheme and
third parties. Fitch estimates Sabesp's 2019-2020 EBITDA at BRL5.2
billion-BRL5.4 billion supported primarily by a tariff increase of
4.3% average per year in addition to total annual volume billed
growth of 1.6% during this period.

FCF Pressured by Capex: Fitch estimates Sabesp's FCF to be around
negative BRL800 million per year on average for the next three
years, being at negative BRL1.0 billion in 2019, which reflects the
expected annual capex increase to BRL3.5 billion-BRL3.9 billion in
2019-2021. Positively, Sabesp counts on sound estimated annual cash
flow from operations of around BRL3.7 billion during the same
period to alleviate FCF pressure, with BRL3.4 billion in 2019.
Fitch projects Sabesp's annual dividends distribution to be
manageable at approximately BRL700 million on average during
2019-2021.

Low Leverage and High FX Debt Exposure: Fitch estimates Sabesp's
net leverage will remain below 2.5x over the next three years,
which is low for the industry and for its IDR, supported by strong
EBITDA and despite higher capex during this period. The company
carries risks associated with its high percentage of
foreign-currency debt, given its strategy of accessing
international funding. Risks are linked to cash flow impact in the
case of strong depreciation during significant foreign currency
debt maturing periods, as in 2020, and financial covenants
calculations. Nevertheless, Fitch estimates that Sabesp's financial
headroom should moderate the impact of an eventual significant FX
depreciation.

Potential Regulatory Changes: Fitch incorporates no major impact on
Sabesp operations and cash flow generation in the case of changes
on regulatory environment. Current discussions on national
water/wastewater guidelines for regulatory environment should
facilitate greater participation of private players and enhance the
investment capacity of the industry. Private players currently
accounts for around 6% of the industry's market share. Fitch
believes private growth should occur mainly toward highly
inefficient state-owned companies or local municipality operators,
which is not the case of Sabesp.

Manageable Hydrological Risk: Sabesp's reservoirs are at manageable
levels to face the dry season during 2019. The company's actions to
enhance water systems interconnection and higher supply capacity
have improved its operating flexibility, which further mitigates
hydrology concerns and should provide stronger resilience to the
company's credit profile to face unfavorable operating
environments.

DERIVATION SUMMARY

Sabesp's mature operations and its position as the largest
water/wastewater utility in Brazil benefit its business profile in
terms of economies of scale and capital structure when compared
with Aegea Saneamento e Participacoes S.A. (Aegea; BB/Negative),
which has moderate leverage, reflecting its growth strategy.
Nevertheless, Aegea's credit profile benefits from its diversified
concessions within Brazil, while Sabesp operates exclusively in the
State of Sao Paulo, which concentrates operational and regulatory
risks. Sabesp also carries a political risk, given its state-owned
condition. Both Sabesp and Aegea have similar and strong EBITDA
margins.

Power transmission company Transmissora Alianca de Energia Eletrica
S.A. (Taesa; BB/Stable) presents a better credit profile than
Sabesp due to its more predictable CFFO, strong financial profile
and lower regulatory risk. In addition, Taesa does not carry
hydrological, political and FX risks.

KEY ASSUMPTIONS

Fitch's Key Assumptions Within Its Rating Case for the Issuer

  - Total annual average volume billed growth of 1.6% during the
next three years, supported by expected population and connections
growth and stable consumption per connection;

  - Annual tariff increases of 4.7%% in May 2019 as already
approved by regulator and 4.0% every May thereafter in accordance
with Fitch's expected inflation and adjusted by the X Factor of
0.69%;

  - Average annual capex of BRL3.7 billion from 2019 to 2021;

  - Dividend payout ratio of 30.5% of net profit (net of legal
reserves).

RATING SENSITIVITIES

Developments That May, Individually or Collectively, Lead to
Positive Rating Action

  - Sustainable positive FCF generation;

  - Lower FX debt exposure.

Developments That May, Individually or Collectively, Lead to
Negative Rating Action

  - EBITDA margins below 33%;

  - Net leverage above 3.5x on a sustainable basis;

  - Fitch's perception of higher political risk.

LIQUIDITY

Robust Liquidity Profile: Fitch expects Sabesp continue to benefit
from its proven financial flexibility, maintenance of adequate
liquidity position and lengthened debt maturity schedule. The
company's financial flexibility is enhanced with its available free
receivables (estimated at around BRL600 million monthly, or
approximately 65% of total receivables) to be offered as collateral
for debt issuances, if necessary, in addition to access to various
sources of funding, including multilateral agency loans specific to
the water/wastewater segment. At Dec. 31, 2018, Sabesp's cash
balance of BRL3.0 billion comfortably covered short-term debt of
BRL2.1 billion by 1.4x and is a meaningful amount to deal with the
expected negative FCF.

At the same date, Sabesp's total debt of BRL13.1 billion consisted
mainly of multilateral agency loans (BRL5.8 billion), debenture
issuances (BRL3.4 billion) and bonds (BRL1.4 billion). Of its total
debt, BRL6.7 billion, or 51%, was linked with FX variation without
any hedge protection. There is BRL739 million maturing in 2019
exposed to FX variation, and BRL1.8 billion maturing in 2020,
mainly comprised of the USD350 million bonds. The company's
strategy considers bond refinancing within the local market, which
could reduce its high FX debt exposure to around 40%. By the end of
December 2018, only BRL2.4 billion of the company's total debt was
secured by future flow of receivables linked with Banco Nacional de
Desenvolvimento Economico e Social and Caixa Economica Federal
loans, which does not pressure unsecured rated issuances.

FULL LIST OF RATING ACTIONS

Fitch has affirmed the following ratings:

Sabesp

  - Long-Term Local Currency IDR at 'BB';

  - Long-Term Foreign Currency IDR at 'BB';

  - USD350 million senior unsecured notes at 'BB';

  - National Long-Term rating at 'AA(bra)';

  - 21st senior unsecured debentures at 'AA(bra)';

  - 22nd senior unsecured debentures at 'AA(bra)'.


OI SA: Posts BRL27.39 Billion Profit for 2018 Fiscal Year
---------------------------------------------------------
Oi S.A. reported a profit of BRL27.39 billion on BRL22.06 billion
of net operating revenue for the year ended Dec. 31, 2018, compared
with a net loss of BRL4.027 billion on BRL23.79 billion of net
operating revenue in 2017.

In its annual report, the Company noted that it has suffered
recurring losses from operations, has a net capital deficit and net
shareholders' deficit, and needs to achieve the conditions of the
judicial reorganization plan which include: (a) the conversion of
the debt into equity of the qualified bondholders; credits and (b)
a capital increase in the amount of BRL4 billion via a public
offering.  These events or conditions raise substantial doubt about
its ability to continue as a going concern.

Oi S.A., which won court approval of its rehabilitation plan in
January 2018, said that as a result of the approval and
confirmation of the Plan:

   * it has begun to attract new corporate customers for its B2B
     business as the concerns of these potential customers
regarding
     the long-term sustainability of its business have receded;

   * it recorded gain on reorganization items, net of BRL31.58
     billion during 2018;

   * all of its obligations recorded as liabilities subject to
     compromise as of Dec. 31, 2017, have been reclassified to
other
     line items on its balance sheet and statement of operations to

     reflect the recoveries of the creditors with respect to those

     obligations, its payment of BRL161 million to settle some of
its
     debt instruments and trade payables as part of the Small
Creditors
     Program (a program under which creditors could engage in
mediation
     of their claims with the Company under which the Company would

     settle claims of BRL50,000 or less without extinguishing those

     claims), and the settlement of some of its other liabilities
     through mediation.

   * it recorded interest expenses and foreign exchange gains and
     losses on its restructured loans and financing as part of
     its financial expenses, net in the aggregate amount of
     BRL4.045 billion during 2018.

As a Brazilian company with substantially all of its operations in
Brazil, it is affected by economic conditions in Brazil. Brazilian
GDP grew by an estimated 1.1% during 2018 and by 1.0% during 2017,
following a decline of 3.5% in 2016.  During the three-year period
ended Dec. 31, 2018, the number of mobile subscribers in Brazil has
declined at an average rate of 3.8% per year, while the number of
fixed lines in service in Brazil during the three-year period ended
Dec. 31, 2018 has declined at an average rate of 4.2% per year.

A copy of the SEC filing is available at:

                      https://is.gd/GB0rRu

                          About Oi S.A.

Oi S.A. is a principal telecommunications service provider in
Brazil with approximately 57.1 million revenue generating units, or
RGUs, as of Dec. 31, 2018.  It operates throughout Brazil and
offers a range of integrated telecommunications services that
include residential services, personal mobility services and B2B
services.

After considering the challenges arising from its economic and
financial situation in connection with the maturity schedule of its
financial debts, and the threats to its cash flows represented by
imminent attachments or freezing of assets in judicial lawsuits, in
June 2016, Oi filed a joint voluntary petition for judicial
reorganization pursuant to the Brazilian Bankruptcy Law, setting
off a protracted battle among creditors and shareholders.

In December 2017, creditors of Oi approved a plan to restructure
about BRL65 billion (US$17.7 billion) in debt.  As part of that
plan, key creditors had agreed to inject an additional BRL4 billion
into the company to allow for needed capital expenditures and to
improve its debt profile.

On Jan. 8, 2018, the 7th Commercial Court of the Judicial District
of the State Capital of Rio de Janeiro entered an order confirming
the Plan.

                          *     *     *


As reported on the Troubled Company Reporter-Latin America on Sept.
27, 2018, S&P Global Ratings assigned its 'B' issue-level rating to
Oi S.A.'s (global scale: B/Stable/--; national scale:
brA/Stable/--) existing $1.6 billion senior unsecured notes due
2025. S&P also assigned a '4' recovery rating to the notes, which
indicates average recovery expectation of 30%-50% (rounded estimate
40%) in the event of payment default.


VOTORANTIM CIMENTOS: Moody's Hikes CFR to Ba1, Outlook Positive
---------------------------------------------------------------
Moody's Investors Service has upgraded Votorantim Cimentos S.A.'s
Corporate Family Rating to Ba1 from Ba2. At the same time, Moody's
upgraded the senior unsecured notes issued by St. Marys Cement Inc.
and Votorantim Cimentos International S.A., unconditionally
guaranteed by VC, to Ba1 from Ba2. The outlook is positive.

List of affected ratings:

Upgrades:

Issuer: Votorantim Cimentos S.A.

Corporate Family Rating: upgraded to Ba1 from Ba2

Issuer: St. Marys Cement Inc.

$500 million senior unsecured notes due 2027 unconditionally
guaranteed by VC: upgraded to Ba1 from Ba2

Issuer: Votorantim Cimentos International S.A.

EUR650 million senior unsecured notes due 2021 unconditionally
guaranteed by VC: upgraded to Ba1 from Ba2

EUR500 million senior unsecured notes due 2022 unconditionally
guaranteed by VC: upgraded to Ba1 from Ba2

$1,250 million senior unsecured notes due 2041 unconditionally
guaranteed by VC: upgraded to Ba1 from Ba2

Outlook Actions:

Issuer: Votorantim Cimentos S.A.

Outlook, Changed to Positive from Stable

Issuer: St. Marys Cement Inc.

Outlook, Changed to Positive from Stable

Issuer: Votorantim Cimentos International S.A.

Outlook, Changed to Positive from No Outlook

RATING RATIONALE

The ratings upgrade to Ba1 is a result of VC's strong links to its
parent company Votorantim S.A. (Ba1 positive), along with the
improvements in operating performance, credit metrics and capital
structure. More specifically, VC has posted a remarkable decline in
leverage metrics that reached 3.8x total adjusted debt to EBITDA in
the end of 2018 - pro forma for the repayment of debt in the 1Q'19
- from 6.5x in the end of 2017 as a result of stronger cash
generation and significant reduction in indebtedness. The upgrade
also takes into consideration the increased share of revenues and
assets outside of Brazil, which reduces the company's exposure to
the Brazilian economy.

VC's Ba1 ratings reflect its leading position in Brazil, its solid
liquidity, large scale and integrated operations, as well as the
close links with and strong support from its parent VSA Since 2016
VSA capitalized VC with BRL4.7 billion, using proceeds from the IPO
of Nexa Resources S.A. (Ba2 stable) and the sale of Fibria,
demonstrating VSA's willingness and ability to support its main
subsidiary.

Moreover, the two companies have cross-acceleration provisions and
guarantees in part of their outstanding debt, and VSA includes VC
as a material subsidiary in its financial statements. VSA drew
about 38% of its EBITDA in 2018 from the cement subsidiary.
Considering the gradual recovery in Brazil's economy, Moody's
estimates VC's contribution may normalize at about 40% over the
next couple of years.

A reduction in debt over time as well as the corporate
restructuring executed in November 2018 are part of VC's strategy
of streamlining its corporate organization in terms of
cross-default provisions and corporate guarantees to and from other
companies within VSA, another step towards a potential equity
offering of the cement business. As of December 2018, pro forma for
debt amortizations, around 22% of VC's gross debt had corporate
guarantees from VSA, down from 89% at the end of 2013. VC also
guarantees around 5% of VSA's total debt. Despite the reduction in
cross guarantees most of VSA's indebtedness has cross default
provisions linked to VC. In addition, given the importance of VC to
VSA's operations, Moody's expects to see continued support from the
parent.

VC's ratings are constrained by the company's weak operating
performance in Brazil because of economic slowdown, and corruption
investigations that are affected the heavy construction market in
the country, resulting in weaker credit metrics for the company.
The cement business in Brazil, which represents around 50% of the
company's revenues and 40% of the EBITDA, continues to hold back
VC's financial metrics, based on the country's economic slowdown
and corruption investigations against heavy construction companies.
Yet for all of these risks, market conditions will continue to
improve in 2019 for cement producers in Brazil, with gradual
recovery in demand of around 3% compared to 2018, following a
cumulative 26% decline from 2014 to the end of 2018. Moody's
forecasts that VC's adjusted debt to EBITDA will further decline to
around 3.2x in 2019 from 6.5x in the end of 2017.

VC has strong liquidity, based on the maintenance of a large cash
balance in proportion to short-term debt. VC had around BRL3.0
billion cash on hand in the end of 2018, pro forma for the BRL2.0
billion capital increase received from VSA in January 2019 and the
repayment of around BRL3.0 billion in debt. Moreover, the company
has $500 million in revolving credit facilities that mature in
2023. Moody's expects that VC will generate more substantial
positive free cash flow starting in 2020, when its capital
expansion program will ease more significantly, almost dropping to
maintenance levels of around BRL1.0 billion from an average of
around BRL1.5 billion in the past four years.

The positive outlook on the company reflects its expectation that
market conditions for cement producers, mainly in Brazil, will
improve in 2019, following a cumulative 25% decline since 2014.
Moody's believes that VC leverage will continue to improve and that
the company will continue to prudently manage its capital spending
and dividend distributions to maintain adequate liquidity to
service its financial obligations.

Given the strong links to its holding company, an upgrade of VC's
ratings would depend on an upgrade of VSA's ratings coupled with
improvements in the Brazilian cement industry. An upgrade would
also require the maintenance of a strong liquidity profile.

The ratings could be downgraded if the company's liquidity profile
deteriorates or if its capital structure weakens as a result of
weaker than anticipated performance of the Brazilian cement market.
A downgrade of VSA's ratings could also result in a negative rating
action for VC's ratings.

Headquartered in Sao Paulo and one of the main subsidiaries of VSA,
VC is the sixth-largest cement company worldwide in terms of
installed capacity excluding Chinese companies. For the 2018, VC
reported consolidated revenue of BRL12.6 billion. The company has
operations in North and South America, Europe, Africa and Asia.


VOTORANTIM SA: Moody's Hikes $750MM Senior Unsecured Notes to Ba1
-----------------------------------------------------------------
Moody's Investors Service has upgraded Votorantim S.A.'s $750
million senior unsecured notes due 2021 to Ba1 from Ba2. The rating
on the $400 million senior unsecured notes due 2024 issued by VSA's
wholly owned subsidiary Companhia Brasileira de Aluminio and
unconditionally guaranteed by VSA was also upgraded to Ba1 from
Ba2. The outlook is positive. At the same time Moody's America
Latina upgraded VSA's Corporate Family Rating to Ba1 from Ba2 in
the global scale and to Aaa.br from Aa2.br in the Brazilian
national scale.

List of affected ratings:

Upgrades:

Issuer: Votorantim S.A.

$750 million senior unsecured notes due 2021: upgraded to Ba1 from
Ba2

Issuer: Companhia Brasileira de Aluminio

$400 million senior unsecured notes due 2024 unconditionally
guaranteed by VSA: upgraded to Ba1 from Ba2

Outlook Actions:

Issuer: Companhia Brasileira de Aluminio

Outlook, Changed to Positive from Stable

RATINGS RATIONALE

The ratings upgrade to Ba1 is a result of the improvements in VSA's
operating performance, credit metrics and capital structure.
Accordingly, leverage declined to 2.6x total adjusted debt to
EBITDA in the end of 2018 - pro forma for the repayment of debt in
the 1Q'19 - from 4.3x in the end of 2017 as a result of stronger
cash generation and substantial reduction in indebtedness. Since
2017, VSA amortized around BRL5 billion in debt, including
repayments of around BRL4.5 billion using part of the BRL7.1
billion received in net proceeds from the sale of Fibria's shares,
which also supported VSA's liquidity and financial flexibility
while reaffirming financial discipline.

VSA's Ba1 rating reflects the company's large size; its status as
one of the largest conglomerates in Brazil; and its diversified
business portfolio in cement, zinc and byproducts, aluminum,
energy, orange juice, long steel and banking, which benefits from
different end-market dynamics and mitigates the effect of
cyclicality in any particular industry.

The rating is also backed by the group's cost-competitive
operations, resulting from high vertical integration, as well as by
its strong liquidity profile and extended debt maturity.
Votorantim's increased geographic diversification is an additional
credit positive and, while it still generates a substantial portion
of its consolidated EBITDA domestically, the company benefits from
leading market positions in virtually all of its operating
segments.

Constraining the ratings are the commodity nature of a substantial
portion of Votorantim's business portfolio (namely zinc and
byproducts, and aluminum) and the improving, but still challenging
operating environment for the company's cement business in Brazil.
Notwithstanding, Moody's expects Votorantim to maintain adequate
leverage for its rating category following the recent deleveraging
initiatives and asset sales.

Historically, Votorantim has reported strong liquidity based on the
maintenance of large cash balances compared with short-term debt.
The company's cash balance was around BRL13 billion in the end of
2018, pro forma for debt prepayments in the 1Q'19 and the proceed
from the sale of Fibria, comfortably covering short-term debt and
all debt maturities until the end of 2026. Adding to Votorantim's
strong cash position are revolving credit facilities amounting to
BRL2.7 billion, with maturities in 2023.

The positive outlook reflects its expectation that VSA will
prudently manage its capital spending and dividend distributions to
maintain adequate liquidity to service its financial obligations.
The positive outlook also assumes that going forward operations
will continue to recover and the company will be successful in
maintaining its strong debt protection metrics.

An upgrade would require VSA to further decrease its leverage
through higher profitability while maintaining excellent liquidity
after potential investments in new businesses. A positive rating
action would also be dependent on a gradual improvement in its
cement business coupled with the maintenance of a competitive cost
position in its metals business. Quantitatively an upgrade would
require leverage measured by total adjusted debt to Ebitda below
2.5x on a consistent basis.

A downgrade would be considered if VSA's cement business does not
recover as expected, if margins decline significantly or if the
company enters into major debt financed acquisitions that
compromise its leverage, profitability and liquidity.
Quantitatively a downgrade would be considered if leverage
increases above 3.5x or if EBIT margin declines below 10%.

The principal methodology used in these ratings was Mining
published in September 2018.

Votorantim S.A. is the holding company of one of Brazil's largest
conglomerates, with a diverse business portfolio that includes
cement, zinc and byproducts, aluminum, energy, long steel, orange
juice, and banking and financial services. In 2018, Votorantim
reported consolidated net revenue of around BRL32 billion.


VOTORANTIM SA: Moody's Hikes CFR to Ba1 & Alters Outlook to Pos.
----------------------------------------------------------------
Moody's America Latina Ltda. has upgraded Votorantim S.A.'s
Corporate Family Rating to Ba1 from Ba2 in the global scale and to
Aaa.br from Aa2.br in the Brazilian national scale. The outlook is
positive.

List of affected ratings:

Upgrades:

Issuer: Votorantim S.A.

Corporate Family Rating: upgraded to Ba1 from Ba2 (global scale)

Corporate Family Rating: upgraded to Aaa.br from Aa2.br (national
scale)

Outlook Actions:

Issuer: Votorantim S.A.

Outlook, Changed to Positive from Stable

RATINGS RATIONALE

The ratings upgrade to Ba1/Aaa.br is a result of the improvements
in VSA's operating performance, credit metrics and capital
structure. Accordingly, leverage declined to 2.6x total adjusted
debt to EBITDA in the end of 2018 - pro forma for the repayment of
debt in the 1Q'19 - from 4.3x in the end of 2017 as a result of
stronger cash generation and substantial reduction in indebtedness.
Since 2017, VSA amortized around BRL5 billion in debt, including
repayments of around BRL4.5 billion using part of the BRL7.1
billion received in net proceeds from the sale of Fibria's shares,
which also supported VSA's liquidity and financial flexibility
while reaffirming financial discipline.

VSA's Ba1/Aaa.br rating reflects the company's large size; its
status as one of the largest conglomerates in Brazil; and its
diversified business portfolio in cement, zinc and byproducts,
aluminum, energy, orange juice, long steel and banking, which
benefits from different end-market dynamics and mitigates the
effect of cyclicality in any particular industry.

The rating is also backed by the group's cost-competitive
operations, resulting from high vertical integration, as well as by
its strong liquidity profile and extended debt maturity.
Votorantim's increased geographic diversification is an additional
credit positive and, while it still generates a substantial portion
of its consolidated EBITDA domestically, the company benefits from
leading market positions in virtually all of its operating
segments.

Constraining the ratings are the commodity nature of a substantial
portion of Votorantim's business portfolio (namely zinc and
byproducts, and aluminum) and the improving, but still challenging
operating environment for the company's cement business in Brazil.
Notwithstanding, Moody's expects Votorantim to maintain adequate
leverage for its rating category following the recent deleveraging
initiatives and asset sales.

Historically, Votorantim has reported strong liquidity based on the
maintenance of large cash balances compared with short-term debt.
The company's cash balance was around BRL13 billion in the end of
2018, pro forma for debt prepayments in the 1Q'19 and the proceed
from the sale of Fibria, comfortably covering short-term debt and
all debt maturities until the end of 2026. Adding to Votorantim's
strong cash position are revolving credit facilities amounting to
BRL2.7 billion, with maturities in 2023.

The positive outlook reflects its expectation that VSA will
prudently manage its capital spending and dividend distributions to
maintain adequate liquidity to service its financial obligations.
The positive outlook also assumes that going forward operations
will continue to recover and the company will be successful in
maintaining its strong debt protection metrics.

An upgrade would require VSA to further decrease its leverage
through higher profitability while maintaining excellent liquidity
after potential investments in new businesses. A positive rating
action would also be dependent on a gradual improvement in its
cement business coupled with the maintenance of a competitive cost
position in its metals business. Quantitatively an upgrade would
require leverage measured by total adjusted debt to Ebitda below
2.5x on a consistent basis.

A downgrade would be considered if VSA's cement business does not
recover as expected, if margins decline significantly or if the
company enters into major debt financed acquisitions that
compromise its leverage, profitability and liquidity.
Quantitatively a downgrade would be considered if leverage
increases above 3.5x or if EBIT margin declines below 10%.

The principal methodology used in these ratings was Mining
published in September 2018.

Votorantim S.A. is the holding company of one of Brazil's largest
conglomerates, with a diverse business portfolio that includes
cement, zinc and byproducts, aluminum, energy, long steel, orange
juice, and banking and financial services. In 2018, Votorantim
reported consolidated net revenue of around BRL32 billion.




===============
C O L O M B I A
===============

COLOMBIA: Economy is Gaining Momentum, IMF Says
-----------------------------------------------
The Executive Board of the International Monetary Fund (IMF)
concluded the Article IV consultation [1] with Colombia on April
19, 2019.

Colombia's economy is gaining momentum, according to the IMF.
Despite slowing global and regional growth, GDP growth strengthened
in 2018 to 2.7 percent-underpinned by private consumption and a
modest recovery in investment. Substantial migration inflows from
Venezuela have added to domestic demand, especially for services.
With demand-led growth, the current account deficit widened to 3.8
percent of GDP last year, as non-oil exports remained sluggish
while imports surged. In terms of financing, the current account
continues to be comfortably financed through foreign direct
investment, as well as robust portfolio flows from a more
diversified set of foreign investors. Inflation eased to near 3
percent at the start of 2018 and has remained stable thereafter.
Inflation expectations also remain anchored near the central bank's
inflation target.
Following rate cuts in the first half of 2018, monetary policy has
been moderately accommodative to support the economic recovery.
Meanwhile, fiscal policy was broadly neutral, as the central
government narrowed its headline deficit, mainly through
expenditure cuts, to comply with the fiscal rule. A Financing Law
should raise tax revenues in 2019 but may curb them in 2020 in
response to a lower tax burden on corporates that nonetheless
should stimulate business investment. Meanwhile, fiscal costs
associated with migration flows from Venezuela are estimated to be
around ½ percent of GDP this year, suggesting fiscal challenges
are rising.

In terms of the outlook, Colombia's economy should accelerate
further this year and next. Staff expects growth around 3.6 percent
in 2019 and 2020 in response to policy accommodation, migrants from
Venezuela, investment-friendly tax reform, infrastructure spending
and improving corporate balance sheets. Subdued corporate credit
growth should pick up with the investment recovery and as loan
quality improves. The structural reform agenda embodied in the
National Development Plan aims to boost inclusive growth and
enhance external competitiveness, while implementation of the peace
agreement should further strengthen regional development.
Heightened downside risks to the outlook stem primarily from the
external side, including weaker global growth amid rising
protectionism and a possible tightening of global financial
conditions.

                  Executive Board Assessment

Directors commended the authorities for their very strong policy
framework and well executed policy actions, that have supported
economic recovery and continued progress toward reducing poverty
and inequality. While the outlook remains favorable, external
imbalances have widened and the economy remains vulnerable to
risks, including from lower global growth, tighter financial
conditions, and ongoing migration pressures from Venezuela. Going
forward, Directors encouraged continued efforts to appropriately
calibrate the policy mix to support recovery, enhance resilience
and build buffers, while implementing structural reforms necessary
to boost inclusive growth and enhance external competitiveness.
Directors commended the authorities for the substantial relief and
support efforts for the large inflow of migrants from Venezuela.

Directors welcomed the authorities' strong commitment to the fiscal
rule, which has served the economy well. In the context of the
large migration shock from Venezuela, they supported the use of
flexibility within the rule to accommodate related spending, while
preserving the integrity of the fiscal anchor and the medium term
structural balance objective. Directors noted that the authorities'
commitment to fiscal sustainability should be supplemented by
structural fiscal reforms to safeguard social spending and public
investment. In order to boost revenue and enhance spending
efficiency, they encouraged efforts to broaden the tax base,
improve tax administration, eliminate preferential regimes for
businesses, reform the energy subsidy and strengthen investment
project selection and evaluation.

Directors welcomed the convergence of headline inflation to its
target and the continued anchoring of inflation expectations. They
noted that the current monetary policy stance is appropriate, but
should be tightened if credit and economic activity recover as
projected. Directors welcomed the central bank's reserve
accumulation program as a proactive step to maintain external
buffers. They noted that the flexible exchange rate should continue
to be the first line of defense against external shocks, with
adequate international reserves and the Flexible Credit Line acting
as additional buffers.

Against a backdrop of a sound banking system, Directors commended
the authorities for continued advances in financial regulation and
supervision, including the steps taken to align regulation with
Basel III standards over time and through the implementation of the
Conglomerates Law that should further strengthen the financial
system.

Directors emphasized the need to continue with structural reform
implementation. They noted that further efforts are needed to
improve the business environment, reduce trade barriers, address
skills mismatches, close infrastructure gaps, strengthen governance
and the rule of law, and reduce corruption. A pension reform that
improves coverage and progressivity should also remain a priority.
Directors welcomed the National Development Plan's focus on many of
these issues and called for its steadfast implementation.




===================================
D O M I N I C A N   R E P U B L I C
===================================

DOMINICAN REPUBLIC: Cedes US$182 Million to Renewable Energy
------------------------------------------------------------
Dominican Today reports that since enforcement of Law 57-07 on
Incentive to the Development of Renewable Sources of Energy and its
Special Regimes, the State hasn't collected around US$182 million
in tax breaks to spur that type of energy.

National Energy Commission (CNE) director Angel Cano told elCaribe
that in recent years, "precisely from the implementation of Law
57-07, the work of the commission has focused on promoting these,
as a way to contribute to the development of the country,"
according to Dominican Today.
He said the National Development Strategy and the law that created
the CNE are the benchmark for the agency's actions, the report
relays.  "They establish the need to incorporate clean energy,
friendly to the environment to the extent possible," the report
notes.

"That was expedited once the agreement was signed in Paris, where
the punctual and accelerated element of the climate change issue
already enters," the official added.

As reported in the Troubled Company Reporter-Latin America in
September 2018, Fitch Ratings affirmed Dominican Republic's
Long-Term, Foreign-Currency Issuer Default Rating (IDR) at 'BB-'
with a Stable Outlook.


[*] DOMINICAN REPUBLIC: Expert Puts Numbers on Construction Boom
----------------------------------------------------------------
Dominican Today reports that the Cibao Savings and Loans
Association (ACAP) described for north region builders the
perspective of the country's economy for 2019 and the opportunities
for their sector.

The economist Jacqueline Mora, who had already dictated the same
conference in Santo Domingo, showed builders a series of updated
indicators such as GDP growth, inflation, monetary policy, credits,
interest rates, jobs and other variables, according to Dominican
Today.

Ms. Mora listed private sector constructions in several provinces.
"In Santiago, for 2018, the private sector built 694,157 square
meters, becoming the country's third highest province in
construction works," the report notes.

"Santiago province concentrates 10.04% of the income of the
country's households, while other cities such as La Vega, San Pedro
de Macoris, Valverde and Samana concentrate between 4.38% and
0.56%," Mora said in an emailed statement obtained by the news
agency.

As reported in the Troubled Company Reporter-Latin America in
September 2018, Fitch Ratings affirmed Dominican Republic's
Long-Term, Foreign-Currency Issuer Default Rating (IDR) at 'BB-'
with a Stable Outlook.




===============
P A R A G U A Y
===============

PARAGUAY: Exports Affected by Economic Crisis in Argentina
----------------------------------------------------------
The Executive Board of the International Monetary Fund (IMF)
concluded the Article IV consultation with Paraguay on April 24,
2019.

The IMF stated that growth in 2018 was 3.7 percent, which is near
potential and in line with the recent past, despite negative
spillovers from the region.  Growth was driven by strong private
investment and household consumption.  Exports were affected by the
economic crisis in Argentina and the strong depreciation of
Paraguay's neighbors' currencies.  The current account deteriorated
but remained in surplus.

Average inflation in 2018 was 3.6 percent -- near the mid-point of
the central bank's target range. Inflation fell during the year,
from 4.7 percent in January to 3.2 in December, the result of
declining food prices and the appreciation of the guarani vis-a-vis
neighboring countries.

Monetary policy rates were on hold in 2018. However, monetary
conditions tightened as the real exchange rate appreciated and real
interest rates rose. In February and March of 2019, the BCP cut the
policy rate twice, from 51/4 to 43/4 percent, citing uncertainty
about the external environment and incipient weakening of domestic
demand. The fiscal deficit in 2018 amounted to 1.3 percent of GDP,
slightly higher than in 2017 but below the ceiling under the Fiscal
Responsibility Law.

Growth in 2019 is projected at 3.5 percent. Risks to the outlook
are tilted to the downside. External risks include
weaker-than-expected growth in Argentina and Brazil, and adverse
price movements in the agricultural commodity markets. Domestic
risks include weather-related shocks and delays in the execution of
public investment.

Over the medium-term, the key challenge is to sustain the rapid
growth of real incomes during the past 15 years. Over the past
decade, Paraguay has been one of the fastest growing economies in
South America, averaging above 4.5 percent real growth per year,
but the factors that have propelled this growth -- including a boom
in agricultural commodity prices -- are likely to provide less
support going forward.

The consultation focused on the policies needed to promote
long-term growth, widen the tax base, improve public spending
efficiency, and strengthen financial sector supervision.

                   Executive Board Assessment

Directors commended the Paraguayan authorities for their prudent
macroeconomic policies which have contributed to rapid growth and
sharp reduction in poverty. Directors considered that policy
priorities ahead should focus on consolidating macroeconomic gains,
reducing dependence on the agriculture sector by diversifying the
economy, and enhancing productivity to attain sustainable and
strong growth as well as further reduce poverty.

Directors commended the authorities' prudent fiscal policies which
have reduced the public debt. However, they noted that with the
deficit close to the ceiling under the Fiscal Responsibility Law it
is important to take action to create further fiscal space for
priority reforms and investment. Directors recommended increasing
revenues, particularly by reducing exemptions and deductions, and
improving tax compliance. They also encouraged the authorities to
reprioritize expenditure within the existing envelope, away from
current spending and toward investment in infrastructure, capital,
and social spending, including in health and education.

Directors considered that the current accommodative monetary policy
stance is appropriate and consistent with inflation objectives.
They noted that exchange rate flexibility should continue to be a
key shock absorber and that interventions should be limited to
mitigate disorderly market conditions.

Directors welcomed that the banking system is well-capitalized and
profitable. They encouraged continued strengthening of supervision
of financial cooperatives and adopting supervision standards for
the casas de credito and casas comerciales. Directors commended the
progress made towards implementing the 2017 Financial Sector
Stability Review recommendations and encouraged steps to further
strengthen the institutional framework for interagency
coordination. They underscored that further strengthening the
AML/CFT framework would support financial stability.

Directors encouraged the authorities to reform the pension system
to ensure its long-term sustainability, seizing the opportunity
that demographic trends are still favorable. They noted that
resuming the effort to establish a pension fund supervisor would be
an important step in this regard.

Directors noted that economic diversification and productivity
growth are needed to maintain rapid growth. They considered that
priority should be given to tackling corruption and strengthening
the rule of law, enhancing the business climate, as well as
improving transport infrastructure and quality of education.

As reported in the Troubled Company Reporter-Latin America on Feb.
8, 2019, Fitch Ratings has assigned a 'BB+' rating to Paraguay's
USD500 million bond, with final maturity in 2050. The bond has a
coupon of 5.4%.




=====================
P U E R T O   R I C O
=====================

SEARS HOLDINGS: Chapter 11 Plan Incorporates $80MM PBGC Deal
------------------------------------------------------------
Sears Holdings Corporation and its debtor affiliates filed a Joint
Chapter 11 Plan and accompanying disclosure statement.

The Debtors commenced these Chapter 11 Cases with the goal of
selling substantially all of their assets as a going concern.  The
Plan contemplates a Wind Down of the remaining assets of the
Debtors' estates -- primarily litigation claims -- and a
distribution to creditors in accordance with the absolute priority
rule and certain settlements.  Specifically, the Plan provides for
the approval of the settlement with the Pension Benefit Guaranty
Corporation.

PBGC Claims (Class 3)are impaired. A beneficial interest in the
Liquidating Trust granted to PBGC, which will entitle PBGC to and
be secured by the first $80 million of Net Proceeds of: (i)
Specified Causes of Action, after payment in full satisfaction of
all Administrative Expense Claims, Priority Non-Tax Claims,
Priority Tax Claims, Other 507(b) Priority Claims, and Other
Secured Claims (or the maintenance of amounts in the Disputed Claim
Reserve Account on account of any of the foregoing Claims that are
Disputed); and (ii) Other Causes of Action arising under Chapter 5
of the Bankruptcy Code, after payment in full satisfaction of all
Administrative Expense Claims, Priority Non-Tax Claims, Priority
Tax Claims, Other 507(b) Priority Claims, ESL 507(b) Priority
Claims, and Other Secured Claims (or the maintenance of amounts in
the Disputed Claim Reserve Account on account of any of the
foregoing Claims that are Disputed).  PBGC Claims will also be
satisfied by sharing with General Unsecured Claims in General
Unsecured Claim recoveries.

A full-text copy of the Disclosure Statement dated April 17, 2019,
is available at https://tinyurl.com/yyvsmgxf from PacerMonitor.com
at no charge.

Ray C. Schrock, P.C., Esq., Jacqueline Marcus, Esq., Garrett A.
Fail, Esq., and Sunny Singh, Esq., at Weil, Gotshal & Manges LLP,
in New York, filed the Disclosure Statement on behalf of the
Debtors.

                     About Sears Holdings

Sears Holdings Corporation (NASDAQ: SHLD) --
http://www.searsholdings.com/-- began as a mail ordering catalog
company in 1887 and became the world's largest retailer in the
1960s.  At its peak, Sears was present in almost every big mall
across the U.S., and sold everything from toys and auto parts to
mail-order homes.  Sears claims to be is a market leader in the
appliance, tool, lawn and garden, fitness equipment, and automotive
repair and maintenance retail sectors.

Sears and Kmart merged to form Sears Holdings in 2005 when they had
3,500 US stores between them.  Kmart emerged in 2005 from its own
bankruptcy.

Unable to keep up with online stores and other brick-and-mortar
retailers, a long series of store closings has left it with 687
retail stores in 49 states, Guam, Puerto Rico, and the U.S. Virgin
Islands as of mid-October 2018.  The Company employs 68,000
individuals, of whom 32,000 are full-time employees.

As of Aug. 4, 2018, Sears Holdings had $6.93 billion in total
assets, $11.33 billion in total liabilities and a total deficit of
$4.40 billion.

Unable to cover a $134 million debt payment due Oct. 15, 2018,
Sears Holdings Corporation and 49 subsidiaries sought Chapter 11
protection (Bankr. S.D.N.Y. Lead Case No. 18-23538) on Oct. 15,
2018.

The Hon. Robert D. Drain is the case judge.

Weil, Gotshal & Manges LLP is serving as legal counsel and M-III
Partners is serving as restructuring advisor.  Aebersold, Managing
Director, and Levi Quaintance, Vice President of Lazard Freres &
Co. LLC serve as investment banker to Holdings.  DLA Piper LLP is
the real estate advisor.  Prime Clerk is the claims and noticing
agent.

The U.S. Trustee for Region 2 appointed nine creditors, including
the Pension Benefit Guaranty Corp., and landlord Simon Property
Group, L.P., to serve on an official committee of unsecured
creditors.  Akin Gump Strauss Hauer & Feld LLP is counsel to the
creditors' committee.  FTI Consulting is financial advisor to the
creditors' committee.  Houlihan Lokey Capital, Inc., is providing
investment banking services to the committee.



                           *********


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 2019.  All rights reserved.  ISSN 1529-2746.

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