/raid1/www/Hosts/bankrupt/TCRLA_Public/210324.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
L A T I N A M E R I C A
Wednesday, March 24, 2021, Vol. 22, No. 54
Headlines
A N T I G U A A N D B A R B U D A
LIAT: More Ex-Pilots Join Class-Action Lawsuit
A R G E N T I N A
ENTRE RIOS: S&P Ups ICR to 'CCC+' on Debt Restructuring Completion
B A H A M A S
BAHAMAS: Tripadvisor Data Show Declined Interest in Country
B R A Z I L
BRAZIL: GDP Shrank by 4.1% in 2020, IBGE Says
BRAZIL: With New Record of Covid-19 Cases, Governor Lowers Taxes
C O L O M B I A
AVIANCA HOLDINGS: Fitch Affirms 'D' IDRs
D O M I N I C A N R E P U B L I C
DOMINICAN REPUBLIC: Gov't. Placed Bonds of More Than US$6BB in 2020
DOMINICAN REPUBLIC: Has Price Stability, Minister Says
DOMINICAN REPUBLIC: Melia Hotels See Progress in Tourism
J A M A I C A
PANJAM INVESTMENT: Reports Loss due to Pandemic
P U E R T O R I C O
DESARROLLADORA VILLAS: To Seek Plan Confirmation April 22
FADYRO DISTRIBUTORS: Court OKs Deal on Cash Collateral Use
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A N T I G U A A N D B A R B U D A
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LIAT: More Ex-Pilots Join Class-Action Lawsuit
----------------------------------------------
Emmanuel Joseph at Barbados Today reports that ten terminated LIAT
pilots have strengthened numbers in their class-action suit against
the Antigua and Barbuda government in the face of a reported threat
by the prime minister to close the St John's-based company.
Six more former pilots came forward to add their names to the
constitutional motion filed in the High Court in St Johns by
Barbadian flyer Captain Neil Cave. They insisted that they won't be
bullied into backing down despite Prime Minister Gaston Browne's
pledge to end all support for LIAT if "pilots and those who
represent them" continue to frustrate his efforts to rescue the
collapsed carrier.
Brown told Antigua's Daily Observer that he could be forced to
hasten the airline's liquidation while distancing his government
from any liability that might arise.
"If this pilot and those he represents continue to frustrate our
Herculean efforts to salvage LIAT 1974 Ltd . . . it's unfortunate;
that despite our best efforts to salvage LIAT and our undertaking
to honour up to 50 per cent of the severance liability on a
compassionate basis; that this type of disruptive behaviour is
being pursued to undermine our efforts," Browne told the Antigua
media outlet which also quoted Barbados TODAY's story on the suit
published March 18.
But Captain Cave told Barbados TODAY that the dismissed pilots have
a sound claim against the Browne administration and will be
pressing forward with their case.
Captain Cave said: "Browne is simply looking for a scapegoat
because of the situation in which he finds himself. He is trying to
use this litigation for which we have a valid claim, as a scapegoat
in talking about closing LIAT.
"I have had six calls from pilots this morning requesting to have
their names joined to that class action suit because they believe
in the merits of the suit."
In a letter on the eve of Browne's threat, Chairman of the
Cabinet's Sub-Committee on LIAT Lennox Weston told the airline's
Administrator Cleveland Seaforth that the St John's government was
leading an initiative among fellow regional shareholders to seek
and support coordination for workers for up to half of their
calculated terminal benefits by way of a compassionate fund.
The letter read: "Options for payment could include cash, land and
deferred bond payments. In order to further this initiative, we
request that you arrange to canvass the former workers and
representative unions to determine whether firstly: they would
agree to accept 50 per cent of workers' computed benefits as a
final payout via the compassionate fund and secondly: if they wish
to pursue other alternatives to advance their claim for
compensation."
Weston said it was essential the airline was reorganized.
"And unless this restructuring takes place and LIAT is returned to
a "going concern" status, the only realistic source of compensation
for former employees would be the residual amounts left, once the
legal procedure of winding up the company takes place," the Cabinet
Sub-Committee head cautioned.
He reminded the Administrator that no shareholder government had
any legal obligation to the company, beyond its limited liability
obligation.
"In this regard, a cursory look at LIAT's most recent statements
would lead any observer to the unmistakable conclusion that there
would be very little benefit, if any, to be derived by former
employees," Weston warned.
The constitutional motion against the government is challenging the
constitutionality of the recently amended Companies Act which
prohibits anyone from suing the Antigua and Barbuda government over
any claims against LIAT.
The claimants, who have named the Attorney General as the only
defendant, also want the court to order that they be awarded costs
and/or other relief the court may deem just.
The ex-pilots are also requesting that the court declares that
Section 564 (1) of the Companies (Amendment) Act No 17 of 2020, is
in contravention of Section 15 (8) of the Constitution of Antigua
and Barbuda by limiting the claimants' constitutional right to
access the court for a determination of their civil claim against
LIAT 1974 Limited which was filed in 2015 and was pending at the
time Parliament passed the law.
About LIAT
LIAT Ltd., formerly known as Leeward Islands Air Transport or
LIAT,
is an airline headquartered on the grounds of V. C. Bird
International Airport in Antigua. It operates high-frequency
inter-island scheduled services serving 15 destinations in the
Caribbean. The airline's main base is VC Bird International
Airport, Antigua and Barbuda, with bases at Grantley Adams
International Airport, Barbados and Piarco International Airport,
Trinidad and Tobago.
The airline is owned by seven Caribbean governments, with three
being the major shareholders: Barbados, Antigua & Barbuda and St.
Vincent and the Grenadines along with Dominica(94.7 %); other
Caribbean governments, private shareholders and employees (5.3%).
In the last few years, LIAT has been challenged with financial
difficulties, often needing additional funding as the airline
dealt
with the high cost of operations. In November 2016, the Barbados
government defended LIAT's operations, even as opposition
legislators called for a cessation of the business. In early
2015,
LIAT offered early retirement packages to employees in efforts to
downsize. In 2014, LIAT knew it had to deal with unprofitable
routes to make operations viable. In the third quarter of 2013,
the airline's top management was shaken, with news Chief Executive
Officer Captain Ian Brunton's sudden resignation.
LIAT's current chief executive officer is Julie Reifer-Jones,
chairman is Jean Holder, and chief financial officer is Rojer
Inglis.
Dr. Ralph Gonsalves, prime minister of St. Vincent & the
Grenadines, serves as chairman of LIAT shareholders.
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A R G E N T I N A
=================
ENTRE RIOS: S&P Ups ICR to 'CCC+' on Debt Restructuring Completion
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S&P Global Ratings raised its global scale issuer credit ratings on
the province of Entre Rios to 'CCC+' from 'SD'. The outlook is
stable. S&P also raised the issue-level rating on its restructured
international bond now due in 2028 to 'CCC+' from 'D'.
Outlook
The stable outlook on S&P's 'CCC+' rating balances the lower risk
of default over the next 12 months following the debt restructuring
with the risks stemming from limited access to funding and limited
economic growth prospects in Argentina, which could pressure Entre
Rios' fiscal accounts and liquidity.
Downside scenario
S&P said, "In the next 12 months, a downward revision of our
transfer and convertibility (T&C) assessment on Argentina would
result in a downgrade of Entre Rios, given that scarcity of reserve
levels could prompt tension in subnational governments' access to
foreign currency for debt service payments. We could also downgrade
the province if a materially weaker-than-expected fiscal
performance or liquidity position increases the risk of default or
a distressed debt exchange in the next 12 months."
Upside scenario
S&P said, "Given that we don't believe that Argentine local and
regional governments (LRGs) meet the conditions for us to rate them
above the sovereign, we would only upgrade the province of Entre
Rios if we take a similar action on Argentina in the next 12
months. This would have to be accompanied by sustained stronger
budgetary performance and liquidity buffers or greater certainty
about the province's capacity to tap debt markets."
Rationale
Given that the new terms of Entre Rios' international bond became
effective on March 18, 2021, the province has cured the default and
materially reduced debt service in 2023-2025. Investors holding
over 97% of bonds supported the province's proposal. The amended
$500 million bond extends the maturity to 2028 from 2025, has
step-up interest rates that go from 5.0% to 8.25%, from 8.750%
previously, and a smoother amortization profile with ten semiannual
installments from three annual payments originally. As a result,
the agreement reduces Entre Rios' debt payments by about $195
million between 2021 and 2023. Entre Rios is the seventh Argentine
province to restructure international debt after Neuquen, Mendoza,
Chubut, Rio Negro, Cordoba, and Salta. At least five other
provinces are still negotiating with bondholders, including the
province of Buenos Aires.
S&P said, "The 'CCC+' ratings on the province of Entre Rios also
reflect our view that while the recent restructuring gives
short-term debt relief and mitigates the risk of default in the
next two years, financial challenges remain. Entre Rios' fiscal
performance improved in 2020, but we expect some erosion in 2021 as
spending pressures emerge and national government support eases."
Absent significant improvements in the province's cash flow
generation capacity, which is currently very weak, along with
macro-financial improvements at the sovereign level, the province's
debt profile would become unsustainable in the next few years. At
the same time, Argentina's very volatile and underfunded
institutional framework constrains our ratings on LRGs.
While fiscal results improved recently, pressures will continue to
limit cash reserves
S&P said, "We expect fiscal results to erode in 2021 following
relatively favorable performance in 2020 as spending pressures
emerge and national government support eases. Entre Rios' budgetary
performance improved in 2020 as real wages contracted and amid
national government transfers and debt relief, which
counterbalanced the hit to local revenue from the effects of the
COVID-19 pandemic and lockdown measures. The province posted an
operating surplus of 4%, from 0.4% on average in the previous two
years, and a 1% surplus after capital accounts (from a deficit of
4.3% on average over 2018-2019).
"While the administration had shown some commitment to reduce its
fiscal gap in recent years, in our opinion pressures on the budget
will emerge and expenditures could increase above inflation,
especially for personnel. Payroll and pension payments together
represent over 70% of Entre Rios' total expenditure, while
infrastructure spending has remained below 5%, underscoring limited
budgetary flexibility. Meanwhile, economic uncertainty will also
pose risks to budgetary expectations. We expect operating surpluses
to average about 2.3% of operating revenues in 2021-2023, with
results after capex remaining slightly negative."
In addition, high pension deficits pressure Entre Rios, because
they aren't entirely covered by national government transfers. The
annual deficit has increased over the past years and reached 10.5%
of operating revenues in 2020. While the administration recognizes
a need for pension reform, little progress has been made so far.
S&P said, "While fiscal results in Entre Rios improved last year,
liquidity is still very limited. In our view, the structural lack
of liquidity buffers remains a key risk to the creditworthiness of
Argentine provinces. We estimate that Entre Rios' free and
available cash is currently low and doesn't cover debt repayment
for 2021.
"Given international debt markets will likely remain closed, we
assume Entre Rios will cover funding needs with pre-approved and
potentially new multilateral lending, as well as with national
government resources and short-term issuances in the local market.
"Debt stock represented 45% of the province's operating revenue in
2020 by our estimates. About 80% of the debt is denominated in U.S.
dollars, which underscores potential currency risk. We expect some
decline in the debt burden in coming years because financing
conditions remain limited, with debt levels lowering to close to
30% of operating revenues."
Like other Argentine provinces, a volatile institutional framework
and limited growth in Argentina constrain the rating
The economic outlook for Entre Rios is weak, in line with the
sovereign. S&P estimates Argentina's GDP to have contracted 12% in
2020 and we forecast it to only grow 4% in 2021. To tackle its
large economic challenges, we think Argentina will need to
establish policy consistency and reduce fiscal and monetary
imbalances, including lower inflation and a more stable exchange
rate regime. The economic contraction plus exchange rate
depreciation resulted in Entre Rios' GDP per capita dropping to
$5,536 in 2020, below the estimated national GDP per capita
($8,500). Amid strained financial conditions, including very
limited access to financing, the administration decided to
prioritize operating and capital spending over timely debt payment
obligations.
S&P said, "Finally, we believe that amid complex macroeconomic
conditions, the sovereign could delay fiscal support measures to
subnational governments, especially given Argentina's history of
major policy swings. We assess the institutional framework for
Argentina's LRGs as very volatile and underfunded, reflecting our
perception of the sovereign's very weak institutional
predictability and volatile intergovernmental system that has been
subject to various modifications to fiscal regulations and lack of
consistency over the years, which jeopardize the LRGs' financial
planning and consequently their credit quality."
In accordance with our relevant policies and procedures, the Rating
Committee was composed of analysts that are qualified to vote in
the committee, with sufficient experience to convey the appropriate
level of knowledge and understanding of the methodology applicable.
At the onset of the committee, the chair confirmed that the
information provided to the Rating Committee by the primary analyst
had been distributed in a timely manner and was sufficient for
Committee members to make an informed decision.
After the primary analyst gave opening remarks and explained the
recommendation, the Committee discussed key rating factors and
critical issues in accordance with the relevant criteria.
Qualitative and quantitative risk factors were considered and
discussed, looking at track-record and forecasts.
The committee's assessment of the key rating factors is reflected
in the Ratings Score Snapshot above.
The chair ensured every voting member was given the opportunity to
articulate his/her opinion. The chair or designee reviewed the
draft report to ensure consistency with the Committee decision. The
views and the decision of the rating committee are summarized in
the above rationale and outlook. The weighting of all rating
factors is described in the methodology used in this rating
action.
Ratings List
Upgraded; CreditWatch/Outlook Action
To From
Entre Rios (Province of)
Issuer Credit Rating CCC+/Stable/-- SD/--/--
Upgraded
To From
Entre Rios (Province of)
Senior Unsecured CCC+ D
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B A H A M A S
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BAHAMAS: Tripadvisor Data Show Declined Interest in Country
-----------------------------------------------------------
Jamaica Observer reports that The Bahamas is on Tripadvisor's list
of ten slowest growing destinations for Americans, according to the
travel website's most recent review of travel trends for the 2021
spring period, March 1 to May 31, and based on volumes of searches
for this destination.
Tripadvisor's data reveal that while Americans are "lusting after
beach resorts and ocean views", their interest in The Bahamas has
declined year-on-year, according to Jamaica Observer.
It noted that that of Americans who are actively planning a trip
for spring on Tripadvisor, over one-third (34 per cent) are
searching for international destinations, compared to 66 per cent
searching for domestic destinations, the report notes.
Addressing the 50th General Assembly of the Organization of
American States last year, the country's permanent representative,
Sidney Collie, said that with the country's economy relying heavily
on tourism, the closure of the borders and restriction in the
movement of people have resulted in a severe slowdown of economic
activity, the report relays.
Moreover, he said the growing challenges have highlighted the
importance of moving beyond antiquated methodologies including the
use of gross domestic product per capita in determining access to
concessional financing, the report discloses.
However, Tripadvisor further indicated that more Americans are
interested in travelling again, compared to the corresponding
period last year when the coronavirus pandemic put a stop to
travel, the report relays.
"While 2020 was the year of the staycation, with the vaccine
roll-out comes increasing confidence in bigger trips," Tripadvisor
states, the report notes.
The data reveals that one-third of Americans are interested in
visiting sunny locales within the continental United States, Mexico
and areas of the Caribbean, the report says.
The ten slowest destinations include:
-- New York City, New York;
-- San Francisco, California;
-- Washington, DC;
-- New Orleans, Louisiana;
-- Los Angeles, California;
-- Nashville, Tennessee;
-- San Diego, California;
-- Las Vegas, Nevada;
-- Chicago, Illinois; and
-- Nassau, The Bahamas.
As reported in the Troubled Company Reporter-Latin America on Nov.
17, 2020, S&P Global Ratings lowered its long-term foreign and
local currency sovereign credit ratings on the Commonwealth of
The Bahamas to 'BB-' from 'BB'. At the same time, S&P Global
Ratings revised down its transfer and convertibility assessment to
'BB' from 'BB+'. The outlook is negative.
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B R A Z I L
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BRAZIL: GDP Shrank by 4.1% in 2020, IBGE Says
---------------------------------------------
Richard Mann at Rio Times Online reports that the Brazilian
Institute of Geography and Statistics (IBGE) reported that the
country's Gross Domestic Product (GDP) shrank by 4.1% in 2020.
However, the Sao Paulo State GDP grew by 0.4% in 2020, said
governor Joao Doria, based on calculations from the State Data
Analysis System Foundation (SEADE).
The governor's announcement at a press conference called for this
purpose came a day after the IBGE's released its report, according
to Rio Times Online.
Doria said that the state's growth, in a context of retraction in
the country' activity and in most countries, proves the strength of
Sao Paulo, the report notes.
About Brazil
Brazil is the fifth largest country in the world and third largest
in the Americas. Jair Bolsonaro is the current president, having
been sworn in on Jan. 1, 2019.
S&P Global Ratings affirmed on December 14, 2020, its 'BB-/B'
long-and short-term foreign and local currency sovereign credit
ratings on Brazil. The outlook on the long-term ratings remains
stable.
Fitch Ratings' credit rating for Brazil stands at 'BB-' with a
negative outlook (November 2020). Moody's credit rating for Brazil
was last set at Ba2 with stable outlook (April 2018). DBRS's credit
rating for Brazil is BB (low) with stable outlook (March 2018).
As reported in the Troubled Company Reporter-Latin America, S&P
Global Ratings' stable outlook assumes that timely implementation
of fiscal adjustment and modest economic recovery will help
preserve market confidence and adequate funding conditions for the
government in local markets in the next two years, despite a
sustained increase in the debt burden.
BRAZIL: With New Record of Covid-19 Cases, Governor Lowers Taxes
----------------------------------------------------------------
Xiu Ying at Rio Times Online reports that the target of protests
and faced with the likelihood that even stricter restrictions will
be implemented in the coming days due to the coronavirus pandemic,
Sao Paulo governor Joao Doria focused on the state's productive
sectors and on March 17, announced tax exemptions and more credit
for commercial businesses.
Sao Paulo registered 17,942 new infections on March 16, and the
governor focused on productive sectors in an attempt to mitigate
the impact of quarantine measures, according to Rio Times Online.
About Brazil
Brazil is the fifth largest country in the world and third largest
in the Americas. Jair Bolsonaro is the current president, having
been sworn in on Jan. 1, 2019.
S&P Global Ratings affirmed on December 14, 2020, its 'BB-/B'
long-and short-term foreign and local currency sovereign credit
ratings on Brazil. The outlook on the long-term ratings remains
stable.
Fitch Ratings' credit rating for Brazil stands at 'BB-' with a
negative outlook (November 2020). Moody's credit rating for Brazil
was last set at Ba2 with stable outlook (April 2018). DBRS's credit
rating for Brazil is BB (low) with stable outlook (March 2018).
As reported in the Troubled Company Reporter-Latin America, S&P
Global Ratings' stable outlook assumes that timely implementation
of fiscal adjustment and modest economic recovery will help
preserve market confidence and adequate funding conditions for the
government in local markets in the next two years, despite a
sustained increase in the debt burden.
===============
C O L O M B I A
===============
AVIANCA HOLDINGS: Fitch Affirms 'D' IDRs
----------------------------------------
Fitch Ratings has affirmed the ratings of Avianca Holdings S.A.'s
(Avianca) Foreign and Local Currency Issuer Default Ratings (IDRs)
at 'D'. Avianca's bond issuances have also been affirmed at
'C'/'RR6'.
The rating affirmation at 'D' reflects the ongoing reorganization
process that Avianca is conducting within the framework of its
Chapter 11 proceedings.
Avianca's balance sheet will be restructured as part of this
process, and will likely result in material changes in the terms
and conditions of its debt. Once the airline exits the
administration proceedings, Fitch will assess the company's new
strategy and restructured financial profile and re-rate Avianca
accordingly.
KEY RATING DRIVERS
Voluntary Reorganization Proceedings: Avianca voluntary filed
petitions under Chapter 11 of the United States Bankruptcy Code in
the U.S. Bankruptcy Court for the Southern District of New York
during May 2020. The company's decision to enter a voluntary
reorganization process resulted from the COVID-19 shutdown, which
exacerbated its stressed liquidity position and high financial
burden.
Operations Severely Halted by Lockdown: Avianca rapidly ceased all
regular passenger flight operations, following a local government
announcement closing Colombian airspace as of March 25, 2020. The
company's operations only started to show some recovery during
4Q20, when travel restrictions started to soften. Demand (Revenue
Passenger Kilometers) and capacity (available set kilometers)
plummeted on average 99% during 2Q20 and 3Q20, showing some
recovery only during 4Q20, with a decline of 84% and 80% yoy,
respectively.
Large Exposure to International Market: Around 49% of Avianca
2019's revenues were originated from long haul international
routes. The recovery of this market remains highly uncertain, as
certain countries or regions are expected to continue to restrict
travel. Avianca has a good business position in several
markets/countries it operates. Besides the aforementioned
international routes, Avianca's revenues were distributed within
Colombian domestic market (51.0%) and Peru and Ecuador 's domestic
markets (10.9%).
Uncertainties Remain High: Avianca's operating cash flow remains
highly uncertain for 2021, as there is a lack of visibility as to
when it will be able to effective recovery its operations. The high
volatility of the market, the slow roll-out of the vaccination
process, and restrictions related to COVID could delay Avianca's
exit from the restructuring process. More visibility in terms of a
stable demand and network will be crucial in determining the new
size of its operations.
DIP Financing: Avianca received approval from the U.S. Bankruptcy
Court in October 2020 to access debtor-in-possession (DIP)
financing totalling approximately USD2.0 billion with around USD1.2
billion of new money. This should help the company navigate a
conclusion of its Chapter 11 process in the second half of 2021.
DERIVATION SUMMARY
The 'D' rating reflects the company participation in the voluntary
administration process (Chapter 11).
KEY ASSUMPTIONS
-- The recovery analysis is based on a liquidation approach given
the high value of its aircraft fleet, which positively
compares to the going concern approach under the current
uncertain scenario for global aviation.
-- Fitch has assumed a 10% administrative claim.
Liquidation Approach:
The liquidation estimate reflects Fitch's view of the value of the
aircraft that can be monetized at advance rates of 50%-70%.
Considering Avianca's total debt waterfall, including on a pro
forma basis the DIP financing, these assumptions result in a
recovery rate for the notes within the 'RR6' range, which has
resulted in 'C' rating for the notes.
RATING SENSITIVITIES
Factor that may, individually or collectively, lead to positive
rating action:
-- Fitch will rate Avianca following its exit from the
administration proceedings based on its new strategy and
financial profile.
Factor that may, individually or collectively, lead to negative
rating action:
-- The company is rated at 'D', therefore, there can be no
negative rating action to the IDRs.
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
Limited Financial Flexibility: As of Sept. 30, 2020, Avianca had
USD254 million in cash & equivalents and USD3.7 billion of
short-term obligations, USD229 million of these financial
obligations are related to lease agreements. Total adjusted debt
was USD5.2 billion at Sept. 30 2020. Debt consists primarily of
USD1.3 billion of aircraft loans, USD1.8 billion of corporate debt,
USD0.6 billion of cross-border bonds and USD1.5 billion of on
balance-sheet lease obligations.
CRITERIA VARIATION
The variation to the Corporates Rating Criteria is a result of the
absence of rating-case and stress-case forecasts for the rating
process, as a result of the elevated uncertainty regarding the
capital structure that will exist at the time Avianca exits its
bankruptcy proceedings and the future fleet capacity that it will
operate with at that time. This variation will be valid as long as
the companies are still in Chapter 11 process and ratings are in
the 'D' category.
ESG CONSIDERATIONS
Avianca Holdings S.A. has an ESG score of '4' for Labor Relations &
Practices reflecting significant pilot strikes that affected the
company. These has a negative impact on the credit profile, and is
relevant to the ratings in conjunction with other factors.
Avianca Holdings S.A. has an ESG score of '4' for Group Structure
due to its complex shareholder structure. The current developments
with United and Kingsland and other shareholders add complexity to
the case.
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. 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.
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D O M I N I C A N R E P U B L I C
===================================
DOMINICAN REPUBLIC: Gov't. Placed Bonds of More Than US$6BB in 2020
-------------------------------------------------------------------
Dominican Today reports that during 2020, the Dominican Government
issued bonds that exceed US$6.0 billion, thus maintaining its
position as a frequent issuer in the world capital markets.
The data is contained in "Institutional Memory 2020" published by
the Ministry of Finance, according to Dominican Today. The
document says that during January 2020, sovereign bonds were placed
for a total of US$2.5 billion, the report notes.
It indicates that this operation consisted of two bonds in US
dollars with terms of 10 and 40 years with coupon rates of 4.50%
and 5.875% and amounts of US$1.0 billion and US$1.5 billion,
respectively, 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).
DOMINICAN REPUBLIC: Has Price Stability, Minister Says
------------------------------------------------------
Dominican Today reports that the Minister of Agriculture, Limber
Cruz, assured that the Dominican Republic is one of the countries
that enjoy greater stability in necessities.
The official affirms that, despite the disproportionate increase
experienced in supplies and raw materials in international markets,
the measures to mitigate these increases have had a local effect,
according to Dominican Today.
The minister says that the increases in these supplies and freight
costs exceed up to 60 percent, the report relays.
"We have made a great team, and you have seen how we have
stabilized. Let me tell you that this is one of the most stable
countries. Other countries cannot find a way to deal with the
situation," said the official, the report notes.
He highlighted the joint efforts made by Agriculture, the Ministry
of Industry, Commerce and MSMEs, the National Price Stabilization
Institute (Inespre), and the agricultural sector to face the upward
trend, closely linked to the impact of the pandemic, the report
discloses.
He also said that more than 360 thousand tasks of land were
identified that would be sown with corn and sorghum for an
"aggressive sowing" that he believes will dramatically impact on
reducing the cost of production in the agricultural sector, mainly
in the poultry sector, the report relays.
The rise in corn has had a negative impact on the price of chicken
due to the increase in production costs in the sector, 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).
DOMINICAN REPUBLIC: Melia Hotels See Progress in Tourism
--------------------------------------------------------
Dominican Today reports that the expectations of occupancy in
hotels in the Dominican Republic are encouraging for Easter 2021
since it coincides with the gradual but constant recovery of
tourism. Last year, the occupancy was minimal (if not zero) due to
the recent incidence of the Covid-19 pandemic.
Such is the case of the Spanish chain Melia Hoteles International
hotels, which anticipates a summer of sure normality in
destinations such as the Dominican Republic and Mexico; this with
an increase that will be noticed in the week off, according to
Dominican Today.
In this sense, Santiago Rivera, Managing Director of Melia Hotels
International in the country, informed arecoa.com that for the
Greater Week the Circle- The Grand Reserve at Paradisus Palma Real
hotel is shaping up to have 75%, the Melia Caribe Beach 30% and the
Melia Punta Cana Beach 40% of its accommodation capacity, the
report notes.
He explained that, without a doubt, positive movements are
beginning to be observed, which "make us much more optimistic in
the medium - long term," due to the confidence of visitors in the
health and safety protocols implemented in the country and the
hotels of the brand, the report relays.
"There is an important advance compared to last year that we were
already involved in the pandemic," he added.
The hotel is expected to complete the opening of its total number
of establishments in the country later since they have eight
luxurious all-inclusive hotels located on the beachfront of Bavaro
Beach in Punta Cana, 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).
=============
J A M A I C A
=============
PANJAM INVESTMENT: Reports Loss due to Pandemic
-----------------------------------------------
RJR News reports that PanJam Investment is the latest listed
company to report that its 2020 financial results took a hit from
the covid-19 pandemic.
Net profit attributable to shareholders was $3.5 billion down from
$8.3 billion in 2019, according to RJR News.
Jamaica Observer reports that the hit from COVID-19 was mainly felt
in PanJam's tourism-related investments such as Chukka Caribbean
Adventures and the Courtyard by Marriott in Kingston given that
international travel was significantly curtailed after March 2020,
when the first COVID-19 case was detected in Jamaica.
As a result, Courtyard by Marriott Kingston and Chukka Caribbean
Adventures both continue to see diminished business activity due to
the pandemic, Jamaica Observer relays.
In their just released 2020 report to shareholders, the board
explained that, "in the first quarter, our investment income was
hit hard by unrealised losses as a result of the market downturn.
Our securities portfolio retained its value thereafter and we
recorded investment income of more than $600 million in the second
half of 2020. Our associated companies saw varying levels of
impact from the pandemic," Jamaica Observer notes.
Jamaica Observer discloses that the board points out that in recent
years PanJam's strategy of increasing its exposure to Jamaican
assets has paid off handsomely in 2019 and prior years, but
COVID-19 has had an adverse impact on the Jamaican economy and
asset prices, including securities and businesses which are heavily
reliant on travel and tourism. The value of PanJam's shares in
associated companies such as its 30.2 per cent equity stake in
Sagicor and other holdings in a number of diverse private entities
has seen a decline of $1.1 billion or 22 per cent, driven by lower
results from Sagicor Group Jamaica, Jamaica Observer says.
Chairman and CEO Stephen Facey and his deputy CEO, Paul Hanworth,
reported that, "on a more positive note, the profitability of
Sagicor Group Jamaica core insurance business lines exceeded their
2019 performance, despite lower overall results, and our share of
profit from New Castle (Walkerswood) increased by 34 per cent,"
Jamaica Observer notes. They were quick to point out that PanJam's
liquid resources have remained strong in 2020, Jamaica Observer
relays.
However, the company's cash flow was impacted by the recommendation
from the Bank of Jamaica to all financial holding companies not to
pay dividends to shareholders owning more than one per cent of
ordinary share, Jamaica Observer says. As such, PanJam's 2020
dividends from its shares in Sagicor have been converted into
short-term, interest-bearing promissory notes, Jamaica Observer
discloses.
"Our strategy ensures that there is balance in times of crisis. Of
note, our real estate assets have continued to demonstrate real
resilience," Facey and Hanworth advised shareholders, Jamaica
Observer relays. On another positive note, PanJam's property
segment's registered a 20 per cent improvement in year on year
profits for 2020, driven by a gain on the disposal of our property
located on Bamboo Avenue, Kingston, Jamaica Observer discloses.
This has resulted in net profit attributable to shareholders of
$3.5 billion, representing a decrease of 57 per cent on the $8.3
billion made in 2019, Jamaica Observer relays.
Property income decreased by four per cent to $2.1 billion coming
from $2.2 billion in 2019, reflecting improved rental income of
$1.8 billion but reduced property revaluation gains of $0.3 billion
coming from $0.5 billion in 2019, Jamaica Observer notes. Higher
other income of $0.4 billion was driven principally by gains from
the sale of its Bamboo Avenue property in Kingston, Jamaica
Observer relays.
Total operating expenses amounted to $1.7 billion, down from $1.8
billion in 2019, a decrease of four per cent, Jamaica Observer
notes. This resulted primarily from deliberate cost containment
measures implemented during the year, Jamaica Observer discloses.
Finance costs increased to $0.8 billion, up from the 2019 posting
of 0.7 billion, as a result of higher average debt balances
supporting our downtown Kingston development project, Jamaica
Observer relays. Performance by Outsourcing Management (trading as
itelbpo) and New Castle (Walkerswood) exceeded expectations, with
both companies increasing profits in 2020, Jamaica Observer notes.
As at the end of December 2020, PanJam held cash and cash
equivalents of $1.6 billion and maintains conservative leverage
which, when combined, would enable the company to raise financing
in order to capitalise on attractively priced investment
opportunities that may arise, Jamaica Observer adds.
=====================
P U E R T O R I C O
=====================
DESARROLLADORA VILLAS: To Seek Plan Confirmation April 22
---------------------------------------------------------
Judge Edward A. Godoy has entered an order approving the Disclosure
Statement of Desarrolladora Villas De San Blas Se.
A hearing for the consideration of confirmation of the Plan and of
such objections as may be made to the confirmation of the Plan will
be held on April 22, 2021 at 1:30 p.m. via Microsoft Teams Video &
Audio Conferencing and/or Telephonic Hearings.
Objections to claims must be filed prior to the hearing on
confirmation.
Acceptances or rejections of the Plan may be filed in writing by
the holders of all claims on/or before 14 days prior to the date of
the hearing on confirmation of the Plan.
Any objection to confirmation of the Plan shall be filed on/or
before 14 days prior to the date of the hearing on confirmation of
the Plan.
About Desarrolladora Villas
Desarrolladora Villas De San Blas, S.E., is a Special Partnership
organized pursuant the laws of the Commonwealth of Puerto Rico and
was chartered on May 8, 1998. Its principal asset is a parcel of
land of little over 41 cuerdas which are undeveloped and located at
Carr. 702, Km. 1.4, Bo. Palmarejo de Coamo, Coamo, Puerto Rico.
Desarrolladora Villas De San Blas filed a Chapter 11 bankruptcy
petition (Bankr. D.P.R. Case No. 20-00087) on Jan. 14, 2020. The
Debtor is represented by Alexis A. Betancourt Vincenty, Esq. of
Lugo Mender Group, LLC.
FADYRO DISTRIBUTORS: Court OKs Deal on Cash Collateral Use
----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Puerto Rico has
approved the Stipulation for Interim use of Cash Collateral and
Adequate Protection filed by Fadyro Distributors Inc. and Oriental
Bank, formerly Scotiabank de Puerto Rico.
As previously reported by the Troubled Company Reporter, the
parties have advised the court they have reached an agreement
regarding Fadyro's use of cash collateral.
Prior to the Petition Date, the Debtor and OB entered into a credit
relationship pursuant to which the Debtor provided estate assets
including, among others, its inventory and account receivables and
the proceeds thereof as collateral to OB.
A foreclosure judgment was entered on the estate assets prior to
the Petition Date.
The parties met through their respective counsels and reached an
agreement in which OB will allow the Debtor to temporarily use cash
collateral until July 12, 2021, solely under and in reliance upon,
the terms and conditions and adequate protection set forth the
Stipulation.
The Debtor will pay consecutive monthly installments of $4,500
directly to OB as adequate protection for the use of OB's cash
collateral from the petition date until July 12, 2021, or the
effective date of a confirmed plan, in which payments under such
confirmed plan to OB will commence, whichever occurs first.
In addition, the Debtor will continue at all times to insure the
real property which comprises OB's collateral as to claim #5, for
its replacement cost in the amount of $1,100,000 and with a loss
payee endorsement in favor of OB as mortgage creditor. The Debtor
will also timely pay all applicable post-petition real property
taxes of said realty.
A copy of the Court's order is available for free at
https://bit.ly/3vDqGuB from PacerMonitor.com.
About Fadyro Distributors, Inc.
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 filing, the Debtor
disclosed between $1 million and $10 million in both assets and
liabilities.
Judge Mildred Caban Flores oversees the case.
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
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contact Peter A. Chapman at 215-945-7000.
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