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/raid1/www/Hosts/bankrupt/TCRLA_Public/210126.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 Tuesday, January 26, 2021, Vol. 22, No. 13 Headlines B R A Z I L LIGHT SA: Fitch Affirms 'BB-' LT IDRs & Alters Outlook to Stable C H I L E LATAM AIRLINES: White & Case Represents LATAM Bondholders D O M I N I C A N R E P U B L I C DOMINICAN REPUBLIC: Fuels Are Expected to Start Falling in March DOMINICAN REPUBLIC: Restaurants Are Almost in a State of Closure DOMINICAN REPUBLIC: Will Continue With The "Safe Basket" Plan M E X I C O MEXICO: Caribbean's Tourism Industry Recovering Despite Covid-19 P A N A M A PANAMA: IMF OKs US$2.7 Billion Precautionary & Liquidity Line P U E R T O R I C O DESTILERIA NACIONAL: Feb. 12 Hearing on Competing Plans FADYRO DISTRIBUTORS: Seeks Court Approval to Hire Accountant - - - - - =========== B R A Z I L =========== LIGHT SA: Fitch Affirms 'BB-' LT IDRs & Alters Outlook to Stable ---------------------------------------------------------------- Fitch Ratings has affirmed the ratings for Light S.A. and its wholly owned subsidiaries Light Servicos de Eletricidade S.A. (Light Sesa) and Light Energia S.A. (Light Energia), including the companies' Foreign Currency (FC) and Local Currency (LC) Long-Term Issuer Default Ratings (IDRs) at 'BB-'. At the same time, Fitch has upgraded the Long-Term National Scale Rating for the three entities to 'AA-(bra)', from 'A+(bra)'. The Rating Outlook for the corporate ratings was revised to Stable from Negative. The revision of the Outlook to Stable follows Light's successful capital increase that will improve the company's capital structure, reducing its high net leverage to 3.5x in 2021 and 3.0x in 2022. The Stable Outlook also incorporates Fitch's expectation that Light will use a considerable part of the proceeds to reduce total debt. On Jan. 19, 2021, Light priced its primary and secondary distribution of common shares, in the amount of BRL2.8 billion, that will be settled on Jan. 22, 2021. Light will receive BRL1.4 billion from the primary offering, which will bring the consolidated credit metrics in line with the current 'BB-' IDRs. The upgrade on the National Scale ratings reflects Light group's strengthening of its credit profile within the 'BB-' IDR level. The primary offering will also improve Light group's already satisfactory liquidity position. Light's pro forma cash position of BRL4.7 billion on Sept. 30, 2020, including the capital increase of BRL1.4 billion and BRL336 million received in December 2020 from an agreement to end an indemnity judicial claim against Furnas Centrais Elétricas S.A. (Furnas), will cover the BRL3.4 billion debt maturing up to December 2021 by 1.4x. This position includes the around BRL800 million net liability to be paid in the first half 2021 to Camara de Comercializacao de Energia Eletrica (CCEE) in the energy generation subsidiary Light Energia. Fitch also views as positive the change in the shareholder structure resulting from the public offering. Light's main shareholder, Companhia Energetica de Minas Gerais (Cemig: Long-Term FC and LC IDRs BB-/Positive), sold all of its shares along with the primary offering, which represented 22.58% of Light's total capital. In Fitch's opinion, the exit of Cemig as a shareholder exclude the weight of the political risk inherent to the public control of the company. Light and its subsidiaries' IDRs continue to reflect the low to moderate business risk profile resulting from Light Sesa's exclusive electricity distribution rights in its concession area, combined with assets on the power generation segment at Light Energia, adding to cash flow predictability during favorable hydrological conditions and risk dilution. The ratings are still limited by the group's challenge to improve its operational performance and translate it into higher profitability. Light has been impacted by an unfavorable scenario in the concession area of its most significant subsidiary, the energy distribution company Light Sesa, in the Metropolitan Region of the State of Rio de Janeiro, with high energy losses and delinquency rates, as well as disappointing results on the recovery of energy demand. The company has the important challenge to improve its reported EBITDA to levels close to the regulatory EBITDA, which Fitch estimates to be about BRL650 million higher in 2021 (35% of inefficiency). The IDRs reflect a consolidated view of Light group's credit profile, due to the existence of cross-default clauses in some debts. The regulatory risk of the Brazilian energy sector was considered moderate, and that hydrological risk exposure, inherent to the sector, is above the historical average and currently pressures the group's consolidated cash flow and financial profile. KEY RATING DRIVERS Positive Results of the Follow On: On Jan. 19, 2021, Light concluded its public shares offer through the sale of 137,242.528 common shares priced at BRL20.00 per share. The shares sold contemplated 68,621,264 newly issued common shares (primary offering) and 68,621,264 common shares sold by Cemig (secondary offering), in the total amount of BRL2.8 billion. With the transaction, Cemig sold its entire 22.58% participation in Light and market free float increases to 66.78% from 44.6%. Nevertheless, the main benefit in the company's credit profile came from the meaningful cash inflow from the primary offering. Improved Capital Structure: Fitch expects Light's consolidated financial net leverage, according to the agency's criteria, to be 4.1x in 2020 and 3.5x in 2021, reducing to more conservative levels below 3.5x from 2022 on. On a pro forma basis, considering the BRL1.4 billion cash inflow from the primary offering and the company's financial statements as of Sept. 30, 2020, and the cash outflow of BRL801 million to be paid to CCEE, Light's consolidated net debt/EBITDA ratio reduces to 3.5x, from the 4.1x reported in the LTM ended Sept. 30, 2020. DERIVATION SUMMARY Light's IDRs are lower than other electric energy groups in Latin America such as Enel Americas S.A. (A-/Stable), Empresas Publicas de Medellin S.A E.S:P. (BBB/Rating Watch Negative), Grupo Energia Bogota S.A. E.S.P. (BBB/Stable) and AES Gener S.A. (BBB-/Stable). Light's business risk is higher, reflecting its operating environment in Brazil (BB-/Negative), while its peers are more exposed to investment grade countries, mainly Chile (A/Negative) and Colombia (BBB-/Negative). Light's business profile is more concentrated in energy distribution than those companies, and presents higher leverage. Compared to a Brazilian electricity group with operations predominantly in the distribution segment, Light's less diversified asset base, lower operational performance and more aggressive financial profile explain the difference from Energisa group's IDRs (Local Currency IDR BB+ and Foreign Currency IDR 'BB'/Negative). Compared to Brazilian peers on the National Scale, Lights credit profile is weaker than Companhia Paranaense de Energia (Copel: AA+(bra)/Positive) and Centrais Eletricas de Santa Catarina (Celesc: AA(bra)/Stable). In comparison with Copel, which has a better business profile, this company has greater relevance in the generation segment in the consolidated results, lower financial leverage and more robust liquidity position. The agency considers that the stronger financial profile of Celesc, benefiting from a conservative leverage ratio and less intense investment plan, justifies the higher rating, despite of its high exposure to the distribution segment. KEY ASSUMPTIONS -- Light Sesa's demand decline of 5.7% in 2020 and increase of 1.5% on average in the following three years; -- Light Energia's disbursement of BRL801 million in one installment in 2021 to liquidate its debt at CCEE; -- Average annual consolidated capex of BRL1.1 billion during 2020-2023; -- Light Sesa's recovery of BRL1.4 billion in non-manageable costs in 2020; -- Dividend payout of 25%, with the payment related to 2019 net income postponed to 2021; -- No asset sale. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: -- Improvements in the distribution segment operating performance; with the company's EBITDA closer to the Regulatory EBITDA; -- Net leverage consistently equal or less than 3.5x; -- Total leverage consistently equal or less than 4.5x. Factors that could, individually or collectively, lead to negative rating action/downgrade: -- Deterioration of the company's liquidity profile; -- Net leverage consistently above 4.5x; -- Total leverage consistently above 5.5x. BEST/WORST CASE RATING SCENARIO International scale credit ratings of Non-Financial Corporate issuers have a best-case rating upgrade scenario (defined as the 99th percentile of rating transitions, measured in a positive direction) of three notches over a three-year rating horizon; and a worst-case rating downgrade scenario (defined as the 99th percentile of rating transitions, measured in a negative direction) of four notches over three years. The complete span of best- and worst-case scenario credit ratings for all rating categories ranges from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are based on historical performance. LIQUIDITY AND DEBT STRUCTURE Strong Liquidity Profile: Light's liquidity and financial flexibility will improve with the BRL1.4 billion cash increase and the BRL336 million received in December 2020 from an agreement to end an indemnity judicial claim against Furnas, better positioning the company to deal with its debt maturities and expected negative FCF. Fitch expects Light group to use a considerable part of the proceeds to reduce total debt. As of Sept. 30, 2020, Light had consolidated cash and equivalents of BRL3.0 billion covering short-term debt of BRL2.3 billion by 1.3x. In addition, a better financial profile should allow the group to refinance existing debt at more attractive conditions with lower funding cost and longer debt amortization. On Sept. 30, 2020, total consolidated adjusted debt of BRL8.7 billion mainly consisted of debentures issuances (BRL5.1 billion), Eurobonds (BRL2.2 billion), securitization of receivables (FIDC) (BRL1.1 billion) and Law 4.131 credit lines (BRL902 million). Off-balance-sheet debt was BRL750 million, related to guarantees provided to nonconsolidated companies. ESG CONSIDERATIONS Light S.A.: Governance Structure: 4 . Light has exposure to board independence risk which, in combination with other factors, impacts the rating. Unless otherwise disclosed in this section, the highest level of ESG credit relevance is a score of '3'. This means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. ========= C H I L E ========= LATAM AIRLINES: White & Case Represents LATAM Bondholders --------------------------------------------------------- In the Chapter 11 cases of LATAM Airlines Group S.A., et al., the law firm of White & Case LLP submitted a verified statement under Rule 2019 of the Federal Rules of Bankruptcy Procedure, to disclose that it is representing the Ad Hoc Group of LATAM Bondholders. The Ad Hoc Group of certain holders of the 6.875% Senior Notes due and 7.00% Senior Notes due 2026, each issued by LATAM Finance Limited, and the Series A Local Bonds due 2028, Series B Local Bonds due 2028, Series C Local Bonds due 2022, Series D Local Bonds due 2028, and the Series E Local Bonds due 2029. As of Jan. 20, 2021, members of the Ad Hoc Group of LATAM Bondholders and their disclosable economic interests are: 140 Summer Partners LP 1450 Broadway 28th Floor New York, NY 10018 * Holder of $18,505,000 of 2024 Bonds and $26,267,000 of 2026 Bonds Administradora de Fondos de Pensiones Capital S.A. Av. Apoquindo 4820, Las Condes Region Metropolitana, Chile * Holder of $15,322,120 of Series B Local Bonds, $5,528,600 of Series D Local Bonds and $42,609,710 of Series E Local Bonds BICE VIDA Compania de Seguros S.A. Av. Providencia 1806, Metropolitana Chile Santiago, Region * Holder of $22,500,00 of 2024 Bonds, $8,000,000 of 2026 Bonds, $186,800 of Series B Local Bonds, $4,763,400 of Series D Local Bonds Caius Capital LLP 135-137 New Bond Street London, W1S 2TQ * Holder of $25,719,000 of 2024 Bonds and $36,443,000 of 2026 Bonds Centerbridge Partners L.P. 375 Park Avenue New York, NY 10152 * Holder of $26,116,000 of 2024 Bonds, $81,869,000 of 2026 Bonds, $33,961,308 of 2027 EETCs, 1 $30,000,000 in Tranche A DIP Commitments, and $16,000,000 in Tranche C DIP Commitments Citigroup Global Markets, Inc. 388 Greenwich St., Tower Building New York, NY 10013 * Holder of $7,535,000 of 2024 Bonds, $13,077,000 of 2026 Bonds, $234,504.36 of 2023 EETCs, $17,486,431.59 of 2027 EETCs, $24,750,000 of the Revolving Credit Facility, and other unsecured claims of $835,003.00 Compania de Seguros Confuturo S.A. Av. Apoquindo 6750, Piso 19 Las Condes, Region Metropolitana, Chile * Holder of $40,500,000 of 2024 Bonds and $5,000,000 of 2026 Bonds Consorcio Financiero S.A Avenida El Bosque Sur 180 Las Condes Santiago Chile * Holder of $42,072,000 of 2024 Bonds, $84,593,000 of 2026 Bonds, $1,974,500 of Series A Local Bonds, $9,576,325 of Series B Local Bonds, $1,974,500 of Series C Local Bonds, $14,848,240 in Series D Local Bonds, $3,949,000 of Series E Local Bonds, $23,090,000 in BTG Unsecured Bank Loans, and $12,500,000 of 2023 EETCs DSC Meridian Capital LP 888 Seventh Ave. xNew York, NY 10016 * Holder of $5,395,000 of 2024 Bonds and $7,502,000 of 2026 Bonds HSBC Securities Inc. USA 452 5th Avenue New York, NY 10018 * Holder of $1,367,000 of 2024 Bonds and 29,548,000 of 2026 Bonds, $15,615,000 of 2023 EETCs and $9,116,000 of the 2027 EETCs Livello Capital Management LP 1 World Trade Center, 85th Floor New York, NY 10007 * Holder of $1,750,000 of the 2024 Bonds and $4,750,000 of 2026 Bonds Seguros Vida Security Prevision S.A. Av. Apoquindo 3150, Piso 8 Las Condes, Region Metropolitana, Chile * Holder of $7,472,000 of Series A Local Bonds and $3,605,240 of Series C Local Bonds VR Global Partners, L.P. 300 Park Avenue, 16th Floor New York, NY 10022 * Holder of $31,817,000 of 2026 Bonds, $27,601,000 of 2023 EETCs, * Holder of $31,817,000 of 2026 Bonds, $27,601,000 of 2023 EETCs, and $1,000,000 of 2027 EETCs On June 15, 2020, the Ad Hoc Group retained Counsel to represent it in connection with the Debtors' Chapter 11 Cases. Each member of the Ad Hoc Group has consented to Counsel's representation. Counsel for the Ad Hoc Group of LATAM Bondholders can be reached at: White & Case LLP John K. Cunningham, Esq. Gregory Starner, Esq. Mark P. Franke, Esq. 1221 Avenue of the Americas New York, NY 10020 Telephone: (212) 819-8200 Facsimile: (212) 354-8113 E-mail: jcunningham@whitecase.com gstarner@whitecase.com mark.franke@whitecase.com Richard S. Kebrdle, Esq. Southeast Financial Center, Suite 4900 200 South Biscayne Boulevard Miami, FL 33131 Telephone: (305) 371-2700 Facsimile: (305) 358-5744 Telephone: rkebrdle@whitecase.com E-mail: rkebrdle@whitecase.com A copy of the Rule 2019 filing is available at https://bit.ly/3o5dc5R at no extra charge. About LATAM Airlines LATAM Airlines Group S.A. -- http://www.latam.com/-- is a pan-Latin American airline holding company involved in the transportation of passengers and cargo and operates as one unified business enterprise. LATAM Airlines Group S.A. is the largest passenger airline in South America. Before the onset of the COVID-19 pandemic, LATAM offered passenger transport services to 145 different destinations in 26 countries, including domestic flights in Argentina, Brazil, Chile, Colombia, Ecuador and Peru, and international services within Latin America as well as to Europe, the United States, the Caribbean, Oceania, Asia and Africa. LATAM Airlines Group S.A. and its 28 affiliates sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 20-11254) on May 25, 2020. Affiliates in Chile, Peru, Colombia, Ecuador and the United States are part of the Chapter 11 filing. The Debtors disclosed $21,087,806,000 in total assets and $17,958,629,000 in total liabilities as of Dec. 31, 2019. The Hon. James L. Garrity, Jr., is the case judge. The Debtors tapped Cleary Gottlieb Steen & Hamilton LLP as general bankruptcy counsel; FTI Consulting as restructuring advisor; and Togut, Segal & Segal LLP and Claro & Cia in Chile as special counsel. Prime Clerk LLC is the claims agent. =================================== D O M I N I C A N R E P U B L I C =================================== DOMINICAN REPUBLIC: Fuels Are Expected to Start Falling in March ---------------------------------------------------------------- Dominican Today reports the Minister of Industry, Trade, and Mipymes (MICM), Victor -Ito- Bisono, said that it is expected that fuels will start to decrease in price as of March this year. Bisono spoke at a press conference at the Ministry of Economy where he said that since last year and so far this 2021, the raw material for oil derivatives has increased by 34%, according to Dominican Today. "That is not the increase that is registered in the Dominican Republic because the Ministry of Industry has been willing to absolve 70% of the increase," ensuring that the Dominican Government has assumed RD$7 of the weekly increase of RD$10 that in the last 15 days has affected the Liquefied Petroleum Gas (LPG), the report notes. Bisono commented that so far in 2021, the MICM had compensated the increases to not directly reach the Dominican population, representing about RD$ 250 million, the report relays. He clarified that in December, because of the cold season, more hydrocarbons are consumed, and this generates an increase in prices, especially in those that have mixtures such as LPG, which has butane, a chemical that has increased 100% and that is reflected in the final price, in addition to the fact that the dollar rate of 2020 was at 11% less than it is this year, the report discloses. "We hope that, as usual, leading up to March there is already a leveling that will begin to lower prices," said the head of the MICM, the report says. He added that it is essential to let people know that the current government assumes a significant burden of price increases, arguing that it is different from "past authorities who left a debt of RD$2.5 billion for a merely political action," the report relays. About Dominican Republic The Dominican Republic is a Caribbean nation that shares the island of Hispaniola with Haiti to the west. Capital city Santo Domingo has Spanish landmarks like the Gothic Catedral Primada de America dating back 5 centuries in its Zona Colonial district. Luis Rodolfo Abinader Corona is the current president of the nation. The Troubled Company Reporter-Latin America reported in April 2019 that the Dominican Today related that Juan Del Rosario of the UASD Economic Faculty cited a current economic slowdown for the Dominican Republic and cautioned that if the trend continues, growth would reach only 4% by 2023. Mr. Del Rosario said that if that happens, "we'll face difficulties in meeting international commitments." An ongoing concern in the Dominican Republic is the inability of participants in the electricity sector to establish financial viability for the system. Fitch Ratings on Jan. 18, assigned a 'BB-' rating to Dominican Republic's USD1.5 billion 5.3% notes due Jan. 21, 2041. Concurrently, the Dominican Republic reopened its 2030 4.5% notes for an additional USD1.0 billion, which Fitch rates 'BB-', raising the total outstanding amount of the 2030 notes to USD2.0 billion. Standard & Poor's, on December 4, 2020, affirmed its 'BB-' long-term foreign and local currency sovereign credit ratings on the Dominican Republic. The outlook remains negative. S&P also affirmed its 'B' short-term sovereign credit ratings. The negative outlook reflects S&P's view that it could lower the ratings on the Dominican Republic over the next six to 18 months, given the severe impact of the COVID-19 pandemic on the sovereign's already vulnerable fiscal and external profiles, as well as the potential for a weaker-than-expected economic recovery. Moody's credit rating for Dominican Republic was last set at Ba3 with stable outlook (July 2017). Fitch's credit rating for Dominican Republic was last reported at BB- with negative outlook (May 8, 2020). DOMINICAN REPUBLIC: Restaurants Are Almost in a State of Closure ---------------------------------------------------------------- Dominican Today reports that the president of the Dominican Federation of Merchants, Ivan Garcia, reported that micro, small and medium restaurants are almost in a state of total closure because their sales have decreased by 70 percent due to the control measures against the Covid-19 pandemic. "We understand that the curfew should be modified. Instead of being at 5:00 in the afternoon, return to its previous state, which was at 7:00 at night, so that restaurants can relaunch their economic activity," Garcia suggested, according to Dominican Today. He specified that many restaurant owners have not been able to restart their operations in the tourist areas of Puerto Plata, Bavaro, Punta Cana, and La Romana, the report relays. They have also had to apply for credit lines to be able to restart their operations, the report notes. He described it as "drastic" the weekends of January 2021, with the closure on Saturdays and Sundays at noon, which has caused the vast majority to close their operations on those days, the report says. Interviewed in the program Toque Final with Julio Martinez Pozo, which is broadcast on Antena 7, Garcia said that this sector expected the revitalization of its economic activity on holidays, but what it has done is have to close its doors on Saturdays and Sundays, the report notes. They are only managing to sell lunch. He indicated that it is necessary to modify the curfew so that these sectors do not disappear from the Dominican economy, the report says. When asked what the situation of sales in the establishments that can operate and what can be done so that economic activity continues to grow amid the Pandemic is, he reported that in general terms, sales in the commerce sector have decreased by around 21 percent if the year 2019 is compared with the year 2020, while, in industries such as bars and restaurants, the reduction has been 70 percent, the report discloses. He advocated a revitalization of the economy of the commercial sector in the Dominican Republic, the report relates. He reiterated that it is necessary to control Covid-19 in the neighborhoods because, in his opinion, it is useless to duplicate the sanitary protocol in commercial establishments if the police do not enter communities to regularize, the report relays. "Unfortunately, our employees live in the neighborhoods, so the situation is much more difficult for us," he added. About Dominican Republic The Dominican Republic is a Caribbean nation that shares the island of Hispaniola with Haiti to the west. Capital city Santo Domingo has Spanish landmarks like the Gothic Catedral Primada de America dating back 5 centuries in its Zona Colonial district. Luis Rodolfo Abinader Corona is the current president of the nation. The Troubled Company Reporter-Latin America reported in April 2019 that the Dominican Today related that Juan Del Rosario of the UASD Economic Faculty cited a current economic slowdown for the Dominican Republic and cautioned that if the trend continues, growth would reach only 4% by 2023. Mr. Del Rosario said that if that happens, "we'll face difficulties in meeting international commitments." An ongoing concern in the Dominican Republic is the inability of participants in the electricity sector to establish financial viability for the system. Fitch Ratings on Jan. 18, assigned a 'BB-' rating to Dominican Republic's USD1.5 billion 5.3% notes due Jan. 21, 2041. Concurrently, the Dominican Republic reopened its 2030 4.5% notes for an additional USD1.0 billion, which Fitch rates 'BB-', raising the total outstanding amount of the 2030 notes to USD2.0 billion. Standard & Poor's, on December 4, 2020, affirmed its 'BB-' long-term foreign and local currency sovereign credit ratings on the Dominican Republic. The outlook remains negative. S&P also affirmed its 'B' short-term sovereign credit ratings. The negative outlook reflects S&P's view that it could lower the ratings on the Dominican Republic over the next six to 18 months, given the severe impact of the COVID-19 pandemic on the sovereign's already vulnerable fiscal and external profiles, as well as the potential for a weaker-than-expected economic recovery. Moody's credit rating for Dominican Republic was last set at Ba3 with stable outlook (July 2017). Fitch's credit rating for Dominican Republic was last reported at BB- with negative outlook (May 8, 2020). DOMINICAN REPUBLIC: Will Continue With The "Safe Basket" Plan ------------------------------------------------------------- Dominican Today reports that the government will continue the "Safe Basket" plan in order to guarantee food for Dominicans, which will represent a relief not only to families but also to small producers. One of the elements of this plan involves an agreement between the government, the producers and the wholesale and retail markets to guarantee the stability of prices in the products of the basic food basket, according to Dominican Today. The announcement was made by the Minister of Economy, Planning, and Development, Miguel Ceara Hatton, at the presentation of the document "Prices of foods for mass consumption in the Dominican Republic and the international scene," the report notes The second point of the plan establishes that the government will buy from the producers, through the Price Stabilization Institute (Inespre), the products of the basic basket to sell them to consumers through the mobile warehouses that will circulate through the streets of Greater Santo Domingo and the provinces of the country, the report relays. The increase in the raw material of agricultural products of high relevance in the international market, such as corn, wheat and soybeans, has increased the price of their derivatives in the local market, he added. These products, he said, are used both for animal feed and for local manufacturing, which is used in the production of bread, cookies, flour, oils, and pasta, the report discloses. "Between June and December 2020, the international price of soybeans increased by 39.3%, soybean oil by 35.3%, corn by 33.3%, and wheat by 21.3%," he added. He pointed out that this has caused the products directly linked to the prices of these goods to have begun to reflect increases in their prices of up to 15.0%, the report relays. It indicates that the price of a barrel of oil, from June 2020 to January 2021, shows accumulated increases of 34.5%, which have been translated into increases in the prices of its derivatives traded locally, the report relays. He pointed out that in recent weeks the Ministry of Agriculture and Inespre have guaranteed the supply of basic food products of local production at affordable prices for lower-income households through the Bodegas Moviles program, benefiting more than 1.3 million families, the report adds. About Dominican Republic The Dominican Republic is a Caribbean nation that shares the island of Hispaniola with Haiti to the west. Capital city Santo Domingo has Spanish landmarks like the Gothic Catedral Primada de America dating back 5 centuries in its Zona Colonial district. Luis Rodolfo Abinader Corona is the current president of the nation. The Troubled Company Reporter-Latin America reported in April 2019 that the Dominican Today related that Juan Del Rosario of the UASD Economic Faculty cited a current economic slowdown for the Dominican Republic and cautioned that if the trend continues, growth would reach only 4% by 2023. Mr. Del Rosario said that if that happens, "we'll face difficulties in meeting international commitments." An ongoing concern in the Dominican Republic is the inability of participants in the electricity sector to establish financial viability for the system. Fitch Ratings on Jan. 18, assigned a 'BB-' rating to Dominican Republic's USD1.5 billion 5.3% notes due Jan. 21, 2041. Concurrently, the Dominican Republic reopened its 2030 4.5% notes for an additional USD1.0 billion, which Fitch rates 'BB-', raising the total outstanding amount of the 2030 notes to USD2.0 billion. Standard & Poor's, on December 4, 2020, affirmed its 'BB-' long-term foreign and local currency sovereign credit ratings on the Dominican Republic. The outlook remains negative. S&P also affirmed its 'B' short-term sovereign credit ratings. The negative outlook reflects S&P's view that it could lower the ratings on the Dominican Republic over the next six to 18 months, given the severe impact of the COVID-19 pandemic on the sovereign's already vulnerable fiscal and external profiles, as well as the potential for a weaker-than-expected economic recovery. Moody's credit rating for Dominican Republic was last set at Ba3 with stable outlook (July 2017). Fitch's credit rating for Dominican Republic was last reported at BB- with negative outlook (May 8, 2020). =========== M E X I C O =========== MEXICO: Caribbean's Tourism Industry Recovering Despite Covid-19 ---------------------------------------------------------------- Lourdes Cruz at EFE News reports that the Mexican Caribbean's tourism industry is bouncing back from a difficult 2020 by attracting a steady flow of visitors from the United States and implementing rapid-result coronavirus testing and other necessary health measures, although that region has come under criticism for alleged lax enforcement of Covid-19 protocols in some areas. With abundant tourist arrivals during the busy Christmas season, packed beaches and open-air parties became a regular sight in the iconic destination of Cancun, located in the southeastern state of Quintana Roo, according to EFE News. And now, even during the post-holiday belt-tightening period, substantial numbers of domestic and foreign tourists can still be seen at that city's sun-and-sand resorts, the report notes. One American visitor, Ray Butler, has been vacationing in Cancun for several weeks, having arrived there from Utah to escape that state's cold winter temperatures, the report discloses. "I came here for the heat, the sun and the wonderful Mexican people," he told EFE after helping a group of workers remove cigarette butts and plastic trash from the sand. In recent days, palapa structures (grass or tiki huts) have been installed and clean-up work carried out at Playa Delfines - Cancun's busiest public beach - in a bid to further boost tourism. Thanks in large part to coronavirus restrictions that were less stringent than in other parts of the world, Mexico became the world's third-most visited country with 25.1 million international tourist arrivals in 2020 (though still down from 41 million in 2019), according to World Tourism Organization estimates, the report discloses. Normally, it ranks in the latter half of the top 10, the report says. In its best-case scenario for 2021, Mexico projects that 33.1 million foreign tourists will arrive and spend an estimated $16 billion, the report notes. One key step taken by Mexico has been to offer rapid-result coronavirus tests to international tourists returning to their countries of origin, the report relays. The US, the No. 1 source country for tourists to Mexico, has announced that a negative coronavirus test will be required for all travelers entering the country as of Jan. 26, the report discloses. Other nations also are demanding that people show proof they are virus-free, the report says. Most of the tests - up to 15,000 per day - will be carried out in Cancun, Isla Mujeres and two localities in the nearby Riviera Maya hotel and tourism district (Playa del Carmen and Cozumel), with the hotels bearing the cost, the report discloses. Besides the rapid-result tests, personnel ranging from housekeeping staff to massage therapists are working under strict protocols aimed at preventing the spread of the different variants of the novel coronavirus, the report relates. "We've established a program that encompasses all of the protocols, following global health standards," the manager of the Krystal Cancun Hotel, Jose Luis Medina, told EFE. There is currently no cause for alarm in Quintana Roo, although Mexico as a whole has been one of the countries hardest-hit by the pandemic, with nearly 1.7 million confirmed cases and more than 142,800 deaths attributed to Covid-19, the report relays. While Mexico's tourism industry has fared somewhat better than its counterparts elsewhere, the pandemic still caused heavy economic losses, layoffs and total or partial closures of businesses, the report notes. In the Riviera Maya, for example, preliminary estimates indicate hotel occupancy fell by nearly 50 percent - from 6.5 million guests in 2019 to 3.3 million in 2020, the report discloses. Projections are better for 2021, with Medina telling EFE that one positive sign is a reduction in the cancellation of flights and reservations. According to the president of the Riviera Maya-based Tulum Hotel Association, David Ortiz Mena, policies aimed at promoting domestic tourism also have yielded encouraging results, the report relates. And the constant arrival of flights to Cancun from the US is a sign of confidence in that destination, even though viral videos of several clandestine year-end parties in Tulum sparked criticism, the report adds. About Mexico Mexico, officially the United Mexican States, is a country in the southern portion of North America. It is bordered to the north by the United States; to the south and west by the Pacific Ocean; to the southeast by Guatemala, Belize, and the Caribbean Sea; and to the east by the Gulf of Mexico. As reported in the Troubled Company Reporter-Latin America, Egan-Jones Ratings Company, on March 30, 2020, downgraded the foreign currency and local currency senior unsecured ratings on debt issued by Mexico to B from BB-. EJR also downgraded the rating on commercial paper issued by the Company to B from A3. =========== P A N A M A =========== PANAMA: IMF OKs US$2.7 Billion Precautionary & Liquidity Line ------------------------------------------------------------- The Executive Board of the International Monetary Fund (IMF) approved Panama's request for a two-year arrangement under the Precautionary and Liquidity Line (PLL) for SDR 1.884 billion (500 percent of Panama's quota, equivalent to about US$2.7 billion), which the authorities intend to treat as precautionary. The PLL will serve as insurance against extreme external shocks. stemming from the COVID-19 pandemic. In 2020, Panama was severely affected by the global pandemic as containment measures significantly reduced economic activity, especially tourism. In addition, the country was hit by hurricane Eta and tropical storm Iota which curtailed a large part of the country's agricultural production. As a result, output is estimated to have dropped by 9 percent, with the fiscal position deteriorating significantly amid revenue shortfalls and expenditure pressures. While Panama is able to cover its external financing needs under present conditions, the arrangement provides insurance against downside risks. Policy priorities under the PLL include supporting an adequate level of spending on health and the social sectors during the pandemic, continuing strengthening further institutional policy frameworks, including financial integrity and data adequacy, and preparing the economy for the post-pandemic recovery. The PLL was introduced in 2011 to meet more flexibly the liquidity needs of member countries with sound economic fundamentals and strong records of policy implementation but with some remaining vulnerabilities. Following the Executive Board discussion, Mr. Mitsuhiro Furusawa, Deputy Managing Director and Chair, made the following statement: "Panama's sound macroeconomic policies have led to over three decades of dynamic growth. However, the impact of COVID-19 pandemic has caused a considerable deterioration in the country's macroeconomic situation and outlook. The two-year arrangement under the Precautionary and Liquidity Line (PLL) for 500 percent of quota (SDR 1.884 billion) will help the authorities' economic recovery efforts against the pandemic, address outstanding vulnerabilities, and boost market confidence. "Panama qualifies under the PLL, as it performs strongly in three out of the five qualification areas (external, fiscal and monetary) and does not substantially underperform in the other two areas (financial and data). It also meets the criteria for exceptional access. The authorities intend to treat the PLL arrangement as precautionary. "The authorities have resolutely implemented measures to contain the pandemic and mitigate its impact on the economy. These include a temporary relaxation of fiscal deficit limits under the Social and Fiscal Responsibility Law to support health and social-related expenditures, permitting banks to drawdown their accumulated dynamic provisioning to absorb credit losses, and loan restructurings for affected borrowers. They are committed to a gradual fiscal consolidation and recalibration of policy responses once the pandemic recedes." The policy agenda during the PLL will focus on facilitating prompt exit from the FATF grey list, strengthening data adequacy and public financial management, as well as preparing the economy for the post-pandemic recovery." ===================== P U E R T O R I C O ===================== DESTILERIA NACIONAL: Feb. 12 Hearing on Competing Plans ------------------------------------------------------- Judge Enrique S. Lamoutte conditionally approved the Disclosure Statement submitted by Destileria Nacional, Inc. on Jan. 13, 2021. The Judge further ordered that: * Feb. 12, 2021 at 10:00 a.m. via Microsoft Teams Video & Audio Conferencing and/or Telephonic is the hearing for the consideration of the final approval of the Disclosure Statement and the confirmation of the Plan. * Acceptances or rejections of the Plan may be filed in writing by the holders of all claims on/or before 10 days prior to the date of the hearing on confirmation of the Plan. * Any objection to the final approval of the Disclosure Statement and/or the confirmation of the Plan will be filed on/or before 10 days prior to the date of the hearing on confirmation of the Plan. * The Debtor will file with the Court a statement setting forth compliance with each requirement in Section 1129, the list of acceptances and rejections and the computation of the same, within seven working days before the hearing on confirmation. A full-text copy of the Disclosure Statement Order entered Jan. 14, 2021, is available at https://bit.ly/3sEn6yK Two Plans at Feb. 12 Hearing Aside from the Debtor, Miramar Brewery, LLC, on Dec. 31, 2020, filed a Disclosure Statement and competing Plan of Reorganization. The Court has earlier conditionally approved the Disclosure Statement, set a Feb. 12 hearing to consider confirmation of Miramar' Plan. Accordingly, the judge will consider both plans at the Feb. 12 hearing. Under the Debtor's Plan, it is anticipated that the Debtor will continue its operation unless a new lockdown order is entered in response to the COVID-19 pandemic. In such case, the Debtor's operation will be modified to comply with any future executive order. In any scenario, the Debtor will continue under the current management in specific Dr. William Cruz, its president. The Plan will be funded from the income generated from the business operation, as well as funding from external sources such as equity holders or party in interest. Under the Plan, holders of Class 2 postpetition trade claims are unimpaired. Holders of Class 3 prepetition unsecured trade claim, which are impaired, will receive their pro rata share of the Debtor's available funds until each holder receives up to 95% dividend of its allowed Claim. A full-text copy of the Debtor's Disclosure Statement dated Jan. 13, 2021, is available at https://bit.ly/2LWzQzJ from PacerMonitor.com at no charge. As reported in the TCR, creditor Miramar Brewing LLC filed a Chapter 11 Small Business Plan that provides that Miramar intends to acquire assets of the Debtor, free and clear of liens and encumbrances, for the continued operation of the related business. The primary purpose of the Plan is to provide for payment to all creditors, including administrative and priority claimants, and creditors holding general unsecured claims, in full satisfaction of their claims, on the Effective Date, through the purchase of all of the assets of the Debtor by Miramar. Holders of Class 2 general unsecured claims in the aggregate sum of approximately $489,835 will receive payment from the sum of $437,901, equivalent to approximately 90 percent of the total amount of claims, to be distributed pro rata, on the Effective Date. A full-text copy of Miramar's Disclosure Statement dated Dec. 31, 2020, is available at https://bit.ly/2KZR6Ef from PacerMonitor.com at no charge. About Destileria Nacional Destileria Nacional, Inc., a beer manufacturer headquartered in Guaynabo, P.R., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D.P.R. Case No. 20-01247) on March 6, 2020. At the time of the filing, the Debtor estimated assets of between $100,001 and $500,000 and liabilities of between $500,001 and $1 million. Judge Enrique S. Lamoutte Inclan oversees the case. The Debtor hired Isabel Fullana-Fraticelli & Asoc. PSC as its legal counsel. FADYRO DISTRIBUTORS: Seeks Court Approval to Hire Accountant ------------------------------------------------------------ Fadyro Distributors, Inc. seeks approval from the U.S. Bankruptcy Court for the District of Puerto Rico to employ Joel Rodriguez Fernandez, an accountant practicing in San Lorenzo, P.R. The Debtor requires an accountant to properly administer its bankruptcy proceeding and comply with the post-petition tax returns accounting and reporting requirements including, but not limited to, monthly operating reports and financial analysis. Mr. Fernandez will be paid at $450 per month. Mr. Fernandez disclosed in court filings that he is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. The accountant can be reached through: Joel Rodriguez Fernandez Urb. Aponte, Calle Abanico 3-P-1 San Lorenzo, PR 00754 Telephone: (787) 736-5020 About Fadyro Distributors Fadyro Distributors, Inc. filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. D.P.R. Case No. 21-00029) on Jan. 5, 2021. At the time of the filing, the Debtor disclosed assets of between $1 million and $10 million and liabilities of the same range. The Debtor tapped Landrau Rivera & Assoc. as its legal counsel and Joel Rodriguez Fernandez, an accountant practicing in San Lorenzo, P.R. ********* 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 2021. 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 * * *