/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/210903.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 Friday, September 3, 2021, Vol. 22, No. 171 Headlines A R G E N T I N A BUENOS AIRES: S&P Assigns Prelim 'CCC+' Rating on Notes Due 2037 B R A Z I L BRAZIL: Economy Minister Agrees with Supreme Court Debt Proposal PETROLEO BRASILEIRO: Clears Excelerate for LNG Terminal Lease D O M I N I C A N R E P U B L I C DOMINICAN REPUBLIC: ILO Expects New Created Jobs to be Unproductive H O N D U R A S TEGUCIGALPA: Fitch Affirms 'B+' LT IDRs, Outlook Stable J A M A I C A JAMAICA: Faces Downgrade to UK 'Red List' Over Increasing Cases M E X I C O ALPHA LATAM: Sets Bidding Procedures for Substantially All Assets SEADRILL LTD: Enters Into Restructuring Deed w/ SeaMex Liquidators P A R A G U A Y PARAGUAY: Pandemic Stimulus Ending as the Economy Bounces Back T R I N I D A D A N D T O B A G O TRINIDAD & TOBAGO: Forex Reserves Get US$644 Million Boost - - - - - ================= A R G E N T I N A ================= BUENOS AIRES: S&P Assigns Prelim 'CCC+' Rating on Notes Due 2037 ---------------------------------------------------------------- S&P Global Ratings assigned its 'CCC+' preliminary ratings on six international notes due 2037, which the Argentine province of Buenos Aires (PBA) issued as part of its international bond debt restructuring. PBA obtained the consent from creditors to exchange 97.66% of the $7.2 billion aggregate principal amount of its international bonds. Nine out of the 11 bonds included in the debt negotiations were entirely restructured, with the remaining two bonds totaling $168.6 million. S&P said, "Upon the completion of the exchange scheduled for Sept. 3, 2021, we will convert the preliminary ratings into final ones, the province will retire the original bonds, and we will raise the issuer credit rating on the PBA to 'CCC+' from 'SD'. Our ratings reflect a forward-looking assessment of the issuer's creditworthiness. Although a minor share of the PBA's currently defaulted debt hasn't been exchanged, the high acceptance level for the exchange leads us to believe the holdout creditors' ability to undermine the PBA's ability to seek external funding in the near term is limited. In addition, we consider that resolution of the default won't likely occur in the short term. "After a year in default and various extensions of the consent solicitation, the province announced on Aug. 30, 2021, that it obtained sufficient support from its creditors to exchange its bonds of $7.0 billion (out of a total of $7.2 billion) on which it had defaulted, for six new notes due 2037. The PBA was able to trigger Collective Action Clauses after comfortably surpassing the 75% threshold on nine out of its 11 international bonds. The PBA will only partly exchange the two remaining bonds, resulting in a residual value of $168 million. The debt restructuring deal doesn't entail capital haircut, but it sharply reduces debt service payments in the short term. We estimate the PBA's debt stock to reach 63.6% of operating revenue at the end of the year." The exchange offer pushes debt service maturities to 2024-2037, from the original period of 2020-2028. At the same time, the weighted average interest payment will drop to an estimated 5.74% from 7.5%. S&P said, "The preliminary 'CCC+' ratings on the bonds reflect the provinces' new debt profile and our view that the risk of default in the next 12 months will be low due to the significant short-term cash flow relief. Most of the amortization payments between the remainder of 2021 and the end of 2023 are short-term paper in local currency, and holdings of the national social security institute (the Spanish acronym of ANSES), reducing the risk of rollover. Nevertheless, fiscal and economic challenges remain, in particular given the prevailing uncertainties over macroeconomic developments in Argentina and the domestic entities' difficulties in accessing international markets. The PBA has maintained balanced fiscal accounts, but spending pressures have accumulated, especially those related to payroll and infrastructure spending. At the same time, the PBA's weak debt payment culture weighs on our rating, because we consider that amid severe economic stress, the province may not prioritize debt over other spending obligations. Access to new borrowing remains uncertain, constraining the province's liquidity profile." Ratings List NEW RATING BUENOS AIRES (PROVINCE OF) Senior Unsecured CCC+ =========== B R A Z I L =========== BRAZIL: Economy Minister Agrees with Supreme Court Debt Proposal ---------------------------------------------------------------- Reuters reports that Brazil Economy Minister Paulo Guedes said he agrees with the solution proposed by the president of the Supreme Court, Luiz Fux, for payment of court-awarded debt owed by the government. The Supreme Court proposed that instead of paying the debt in installments, the government make sure the volume of payments does not exceed the budget spending ceiling, according to the report. The proposal would reduce by around BRL50 billion ($9.6 billion) the total amount the government would have to pay next year, the report notes. Instead of BRL89 billion, the government would have to pay around BRL40 billion in court awarded debt next year. Guedes said that he supports the Supreme Court proposal, after meeting with Senate President Rodrigo Pacheco, the report relates. Speaking to journalists after the meeting, Pacheco said he will meet with Fux to discuss the proposal, the report discloses. House speaker Arthur Lira will also be at the meeting, he added. Reuters recalls that previously, the ministry had proposed the payment of all debt in installments. Guedes also commented to reporters on an open letter that Brazilian business leaders had been contemplating publishing that would criticize the government. Lobbying groups representing manufacturers and banks were expected to sign the letter, notes the report. Guedes said he knew the letter was going to "attack the government" and that disagreements among the business leaders caused publication to be postponed, says Reuters. According to the report, it was not immediately clear how Guedes knew of the letter's contents. 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. Fitch Ratings' credit rating for Brazil stands at 'BB-' with a negative outlook (November 2020). Fitch's 'BB-' Long-Term Foreign and Local Currency Issuer Default Ratings (IDRs) has been affirmed in May 2021. Standard & Poor's credit rating for Brazil stands at BB- with stable outlook (April 2020). S&P's 'BB-/B' long-and short-term foreign and local currency sovereign credit ratings for Brazil were affirmed in December 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). PETROLEO BRASILEIRO: Clears Excelerate for LNG Terminal Lease ------------------------------------------------------------- argusmedia.com reports that Brazilian state-controlled Petrobras has cleared US LNG company Excelerate Energy to lease its 20mn m(3)/d Bahia regasification terminal in an important step toward opening of Brazil's natural gas market. Petrobras is currently analyzing Excelerate's revised lease proposal to ensure that it meets the required technical criteria, according to argusmedia.com. Excelerate presented the new bid in July after Petrobras disqualified its original proposal because of the inclusion of a termination clause, the report notes. If the deal moves ahead, Excelerate will take control of the terminal by December 31, the report relays. The US company could not be immediately reached for comment, the report relays. The lease is part of Petrobras' 2019 agreement with anti-trust agency Cade, which requires the company to exit gas transport and distribution, the report notes. The Bahia terminal has the commercial advantage of connecting to the Transportadora Associada de Gas (TAG) pipeline system, facilitating distribution of regasified LNG, the report says. The announcement comes as gas distributors in northeastern Brazil seek supply agreements for 2022, after Petrobras said it would not renew their contracts, the report discloses. Excelerate was one of 11 companies that was recently pre-qualified for a joint tender offer by three northeastern gas distributors: Algas (Alagoas), Bahiagas (Bahia) and PBgas (Paraiba), the report notes. LNG supply to the region is expected to increase substantially, with two new regasification terminals slated to start operations in early 2022 at Suape port in Pernambuco state, the report discloses. TAG has also announced plans to build a pipeline connecting New Fortress Energy's Sergipe regasification terminal to its pipeline by early next year, says the report. Petrobras is increasingly under pressure to bring a floating storage and regasification unit (FSRU) to the Pecem terminal in Ceara state to boost thermoelectric generation as the country faces its most severe drought in over 90 years, the report notes. The government recently mandated that Petrobras begin operating all three terminals by September 30, the report relays. The Pecem terminal is currently idle because Petrobras only has two FSRUs - the 173,400m(3) Excelerate Experience currently deployed at its Guanabara terminal and the 138,000m(3) Golar Winter at Bahia, the report notes. The government cleared the Termoceara thermoelectric plant to operate on diesel because of limited gas supplies in Ceara, the report adds. About Petrobras Petroleo Brasileiro S.A. or Petrobras (in English, Brazilian Petroleum Corporation - Petrobras) is a semi-public Brazilian multinational corporation in the petroleum industry headquartered in Rio de Janeiro, Brazil. Petrobras control significant oil and energy assets in 16 countries in Africa, the Americas, Europe and Asia. But, Brazil represents majority of its production. The Brazilian government directly owns 54% of Petrobras' common shares with voting rights, while the Brazilian Development Bank and Brazil's Sovereign Wealth Fund (Fundo Soberano) each control 5%, bringing the State's direct and indirect ownership to 64%. A corruption scandal was uncovered in 2014 that involved Petrobras. The scandal related to money laundering that involved Petrobras executives. The executives were alleged to get received kickbacks from overpriced contracts, to the tune of about $3 billion in total. S&P Global Ratings affirmed its 'BB-' global scale and its 'brAAA' Brazilian national scale ratings on Petrobras on July 28, 2021. Moody's Investors Service affirmed the 'Ba2' long term foreign currency credit rating of Petrobras on August 23, 2019, with a stable Outlook. Fitch revised outlook on Petrobras to negative and affirmed 'BB-' long term foreign currency and local currency credit ratings on May 7, 2020. =================================== D O M I N I C A N R E P U B L I C =================================== DOMINICAN REPUBLIC: ILO Expects New Created Jobs to be Unproductive ------------------------------------------------------------------- Dominican Today reports that the International Labour Organization (ILO) states that the employment growth expected this year will be insufficient to fill the gaps opened by the crisis generated by the pandemic, and to add insult to injury, many of the newly created jobs are expected to be unproductive and of poor quality. In the report "World Employment and Social Outlook. Trends 2021," the ILO highlights that between 2019 and 2022, the average rate of labor productivity growth is expected to fall below the pre-crisis rate in all countries except high-income countries, according to Dominican Today. As a result of the low growth of gross domestic product and the sharp increase in the working-age population, the lack of productive employment offers will be more pronounced in low-income countries, the report notes. "In these countries, the average annual growth of labor productivity is expected to decrease, going from an already meager 0.9% for the period 2016-2019 to a negative rate of - 1.1% for 2019-2022," the report states, Dominican Today relays. ILO analysts say these dialyzing forecasts further hamper the goal of eradicating poverty by 2030, and the increase in self-employment, which is disproportionately characterized by low productivity and everyday work, is another sign of the deterioration in the quality of work, the report discloses. Globally, it is estimated that in 2020 job destruction among salaried workers was twice as high as in the self-employed, which will cause a change in the structure of employment, 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, 2021, 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). =============== H O N D U R A S =============== TEGUCIGALPA: Fitch Affirms 'B+' LT IDRs, Outlook Stable ------------------------------------------------------- Fitch Ratings has affirmed the Long-Term Foreign and Local Currency Issuer Default Ratings (IDR) of Honduras's Alcaldia Municipal del Distrito Central, Tegucigalpa (AMDC) at 'B+'. The Rating Outlook is Stable. In addition, Fitch has affirmed AMDC's Short-Term IDR at 'B'. The affirmation reflects Fitch's unchanged view that AMDC's operating performance and debt ratios will remain in line with 'B' rated peers' over the medium term, despite the economic downturn triggered by the coronavirus pandemic. The assessment also takes into account AMDC's capex trend over the last six years that, if maintained, will need to be financed with new debt in the rating case scenario. AMDC's Standalone Credit Profile (SCP) has been assessed at 'b+'. KEY RATING DRIVERS Risk Profile: 'Vulnerable' AMDC's risk profile reflects Fitch's 'Midrange' assessment on two risk factors: expenditure sustainability and expenditure adjustability; and four as 'Weaker': revenue robustness, revenue adjustability, liabilities and liquidity robustness and flexibility. The 'Vulnerable' risk profile reflects a very high risk relative to international peers that AMDC cash flow available for debt service may weaken beyond reasonable downturn expectations over the forecast horizon (2021-2025). It also reflects the weak institutional framework in which local and regional governments (LRGs) operate in Honduras. Revenue Robustness: 'Weaker' AMDC has strong and predictable local revenue collection rates; hence its operating revenue is mostly made up of taxes and fees (2020: 94%), the growth prospects of which were constraint by disruptions caused by the coronavirus pandemic. In real terms, AMDC's operating revenue grew at -0.3% in 2016-2020 versus Honduras's average real GDP growth of 1.4%. In 2020, real operating revenue decrease 14.1%, above Honduras's GDP decline of 9.0%, mainly driven by lower than expected taxes. Tax collection decreased by 24.7% in nominal terms, while operating revenue decline 11.1% versus 2019. Stable tax revenue is counterbalanced by a low GDP per capita by international standards that constrained the growth prospects of taxes and non-taxes. In addition, taxation has shown some volatility linked to political cycles. Revenue Adjustability: 'Weaker' AMDC's ability to generate additional revenue in response to possible economic downturns is limited. The city has formal tax-setting authority over several local taxes and fees that accounted for about 94% of total revenue in 2020. Its affordability to raise revenue is constrained by the lower-middle income of residents by international standards and social-political sensitivity to tax increases. Expenditure Sustainability: 'Midrange' AMDC's control over operating expenditure is remarkable, with a track record of keeping spending growth below that of operating revenue for the period of 2016-2020, allowing for a stable operating margin of around 56.3% on average in 2016-2020. Operating expenditure (opex; current expenses plus government transfers) represented on average 36.3% of total expenditure over the last five years. Over the same period, capital outlays have represented an average of 53.0% of total expenditure (in fiscal 2020: 41.4%). In 2020, the pandemic caused to reallocate spending on sanitation and social programs that the city compensated by opex savings in some areas such as public administration and current expenses. Overall, in comparison to 2019, opex increased 6.2% while operating balance decrease 22.9%; but still stood at 51.5% of operating revenues. Expenditure Adjustability: 'Midrange' In its rating scenario, Fitch expects AMDC to continue to report large operating margins of 42.0%. Around 53.0% of expenditure before debt service is capital outlays, keeping the share of inflexible expenditure below 70%. This represents a moderate flexibility to control and cut expenses in a scenario of lower revenues. Fitch believes that the high level of capital investments necessary to cover the city's large infrastructure needs and requirements will largely be financed by operating margins and debt. AMDC's high investment program, with capex averaging 53.0% of total in 2016-2020, offered some leeway as worsened economic conditions forced the city to re-direct outlays. As such, during 2020, capex declined to 41.6% of expenditure (2019: 53.6%). Over the longer term, high level of capex is necessary to maintain local attractiveness amid demographic pressures calling for more spending on infrastructure such as water distribution and roads. For 2021, Fitch expects capex outlays will recover and reach 50% of total expenditure. Liabilities and Liquidity Robustness: 'Weaker' The central government sets a public debt ceiling for subnationals. However, this can be waived if Congress permits subnational governments to acquire new debt. Besides bank loans, there is no track record of capital market access for financing. Their direct long-term debt (DLTD) is exposed to market risk since all the debt has variable interest rates; however, the maturity profile of this debt has no concentration risk. Overall, there is a weak national framework for debt and liquidity management. At YE 2020, direct debt totaled HNL4,605 million, of which HNL1,577 million was short-term bank loans. Average cost of debt hovers around 10.2%. Long- and short-term debt is paid through a trust mechanism that ensures timely debt service payments. All of AMDC's debt is with local commercial banks. As of July 2021, direct debt is at HNL4,549 million, of which HNL1,263 million was short-term bank loans. In Fitch's rating case, net adjusted debt is expected to increase towards HNL11,297 million by end-2025, end-2020 was HNL4,605 million, underpinned by large infrastructure needs in sectors such as public transport, roads and water. Fitch assumes that the city's investment program is going to be maintained. Liabilities and Liquidity Flexibility: 'Weaker' AMDC's available liquidity is weaker with respect to payables (end-2020: 0.10x; average 2016-2020: 0.11x). In addition, the city has exhibited high concentration of counterparty risk on bank credit lines (bank ratings) below 'BBB' category, triggering a 'Weaker' assessment on this factor. Historically, local governments in Honduras prefer to tap bank loans rather than other funding options due to shallow capital markets. As of July 2021, AMDC had HNL1,263 million outstanding short-term debt (July 2020: HNL1,568 million). Debt sustainability: 'a' category, unchanged Under Fitch's rating case scenario, AMDC's payback ratio (net adjusted debt to operating balance) is forecast at 8.9 years in Fitch's 2021-2025 projections; this is the primary metric of debt sustainability, and is assessed in the 'aa' category. Fitch overrides the primary metric by one rating category, to incorporate an actual debt service coverage ratio (ADSCR, operating balance to debt service) below 1.0x in Fitch's rating case. The overall final score for debt sustainability is 'a'. DERIVATION SUMMARY AMDC's SCP is assessed at 'b+', reflecting a combination of vulnerable risk profile and debt sustainability in the 'a' category. The notch-specific rating positioning factors in comparison with international peers, including Argentine, Ukraine, and Nigerian peers. Fitch does not apply any asymmetric risk or extraordinary support from upper-tier government, which results in an IDR of 'B+'. The short-term rating of 'B' is derived from AMDC's Long-Term IDR. KEY ASSUMPTIONS Fitch's rating case is a 'through-the-cycle' scenario, which incorporates a combination of revenue, cost and financial risk stresses. It is based on 2016-2020 figures and 2021-2025 projected ratios. The key assumptions for the scenario include: -- Overall operating revenue CAGR for 2021-2025 is forecast at 7.0%; -- Opex is forecast to reach a CAGR for 2021-2025 of 10.5%; -- Net capital balance of around minus HNL1,833 million in 2025; -- Cost of debt for 2021-2025 at 11.5% on average; -- Capex is expected to grow at least in line with inflation in the rating case, which is to be financed with operating margins and new debt. The starting amount for 2021 is the three-year average for 2017-2020. Large infrastructure needs underpinned this assumption. RATING SENSITIVITIES Factor that could, individually or collectively, lead to positive rating action/upgrade: -- If debt sustainability metrics improve such that the payback ratio is lower than 5x and the fiscal debt burden is between 50% and 100%, coupled with an improved debt service coverage of ratio between 2.0x and 4.0x. Factor that could, individually or collectively, lead to negative rating action/downgrade: -- A sustained deterioration of the payback ratio above 9x due to a weakened operating balance coupled with an actual coverage below 1.5x could lead to a downgrade of Long-Term IDRs or if AMDC compares unfavorably with peers. BEST/WORST CASE RATING SCENARIO International scale credit ratings of Sovereigns, Public Finance and Infrastructure 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 three 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. ISSUER PROFILE Tegucigalpa, Alcaldia Municipal del Distrito Central (AMDC) is Honduras's capital city. Its GDP per capita is above Honduras USD2,383, but it is low by international standards. AMDC's economic structure is well diversified, fueled by public and private investment, which supports robust internally generated revenues. AMDC covers debt service with its operating balance. SUMMARY OF FINANCIAL ADJUSTMENTS No material adjustments were made to figures reported by the municipality. ESG CONSIDERATIONS 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. ============= J A M A I C A ============= JAMAICA: Faces Downgrade to UK 'Red List' Over Increasing Cases --------------------------------------------------------------- Jamaica Observer, citing ITV News, reports that Jamaica -- along with Dominica and St Lucia -- now faces the risk of being downgraded to the United Kingdom's red list of countries. As the number of novel coronavirus cases continue to rise on the island, travel expert Paul Charles has indicated that the island and its Caricom counterparts will lose their medium- and low-risk status on the UK's travel watch list and share company with a number of countries deemed as high-risk destinations, according to Jamaica Observer. "Significant changes could be coming to some Caribbean islands - Jamaica, St Lucia, and Dominica turning red. And Montserrat, Anguilla, Antigua, and Turks and Caicos [could be] demoted from green to amber," another news outlet quoted Charles, who is CEO of a UK-based booking company PC Agency, the report notes. The news comes as Jamaica hit a record 879 new cases with a positivity rate of 43.9 per cent, the report relays. In addition, the country recorded 14 deaths with 607 people hospitalized, the report notes. At the same time, St Lucia's Ministry of Health, Wellness and Elderly Affairs confirmed 42 new cases of COVID-19 from 181 samples, the report says. In response to the news, senior advisor and tourism communications strategist in Jamaica's Ministry of Tourism Delano Seiveright told the Jamaica Observer that, along with the Jamaica Tourist Board, they are currently engaged in a strategic retreat to discuss, among other matters, how to address being placed on the UK's red list, the report relates. "If Jamaica is moved from the amber list to the UK red list it would be a major setback, but hopefully a temporary one. We are hopeful that any change will only last a few weeks as we expect the COVID infection numbers to decline in due course," said Seiveright, the report says. "Several neighbouring and major tourism destinations have been on the red list for a while including the Dominican Republic, Mexico and Cuba." At present, only UK citizens and residents are allowed entry into the country if they are returning from a country on the red list. Additionally, citizens and residents landing in England from a red list country need to pay GBP2,285 to quarantine in a Government-approved hotel, the report relates. With this in mind, Seiveright noted: "Therefore, hardly anyone would fly, resulting in a pull-out of almost all flights between Jamaica and the UK." He, however, expressed hope that Jamaica will be able to reduce transmission of the novel coronavirus with the current measures, and that the island's airports, come October, should receive a total of 14 flights from several UK cities led by TUI, British Airways and Virgin Atlantic, the report discloses. Seiveright added that Tourism Minister Edmund Bartlett recently negotiated with travel partners for the recommencement and addition of new services from London Heathrow, London Gatwick, Manchester, and Birmingham, the report notes. When asked by the Business Observer if he thought cancellation of trips from the UK would result in a significant falloff in tourism receipts, the advisor responded in the negative, the report relays. "The UK is our third-largest market but still represents, in pre-COVID times, roughly eight per cent of our stopover arrivals. The United States is still our largest and most important market with just under 70 per cent of stopover arrivals in pre-COVID times, and Canada second with just under 15 per cent of the business also in pre-COVID times. Since the onset of COVID the US traveller has dominated," he explained, the report adds. Seiveright said that, given that the winter season usually produces Jamaica's highest tourism receipts, the country has enough time to return to the UK's amber list, or even ascend to the green list, the report relays. About Jamaica Jamaica is an island country situated in the Caribbean Sea. Jamaica is an upper-middle income country with an economy heavily dependent on tourism. Other major sectors of the Jamaican economy include agriculture, mining, manufacturing, petroleum refining, financial and insurance services. Fitch Ratings affirmed in March 2021 Jamaica's Long-Term Foreign Currency Issuer Default Rating (IDR) at 'B+', with a stable outlook. Standard & Poor's credit rating for Jamaica stands at B+ with negative outlook (April 2020). Moody's credit rating for Jamaica was last set at B2 with stable outlook (December 2019). According to Fitch, Jamaica 'B+' rating is supported by World Bank Governance Indicators that are substantially stronger than the 'B' and 'BB' medians, a favorable business climate according to the World Bank Doing Business Survey, moderate inflation and moderate commodity dependence. These strengths are balanced by vulnerability to external shocks, a high public debt level and a debt composition that makes the sovereign vulnerable to exchange rate fluctuations. The Stable Outlook is supported by Fitch's expectation that the public debt level will return to a firm downward path post-pandemic, which is underpinned by political consensus to maintain a high primary surplus, the resilience of external finances, and stronger economic policy institutions. =========== M E X I C O =========== ALPHA LATAM: Sets Bidding Procedures for Substantially All Assets ----------------------------------------------------------------- Alpha Latam Management, LLC, and affiliates, asks the U.S. Bankruptcy Court for the Southern District of New York to authorize the bidding procedures in connection with the proposed sale of all or substantially all of certain of their loan portfolio and operating assets. A hearing on the Motion is set for Sept. 15, 2021, at 9:30 a.m. (ET). The Objection Deadline is on Sept. 7, 2021, at 4:00 p.m. (ET). By the Motion, the Debtors seek approval of bidding procedures for a competitive sale process for the Assets, which is designed to maximize the value of their estates. The proposed Bidding Procedures allow them to continue and conclude the marketing process they began approximately three months ago in an appropriate time-frame through a competitive auction process. Even before the commencement of these Chapter 11 Cases, the proposed sale of the Assets was identified as the best path for maximizing the value of the Debtors' estates. To test this thesis, the Debtors initiated a thoughtful process in May to solicit indications of interest for the Assets. During their pre-petition negotiations and restructuring analysis, it became evident that the best way to maximize value for the Assets was to pursue an in-court sale via section 363 of the Bankruptcy Code, which was one of the reasons the Debtors commenced these Chapter 11 Cases. The Buyers will receive comfort from the Court's approval of the Sale and the section 363 sale process, including the Bidding Procedures proposed, will allow for a robust marketing process to achieve the highest and best price for the Assets. Since commencing the marketing process, the Debtors have received robust engagement, with several credible parties submitting indications of interest and progressing towards the submission of binding bids. The Debtors have been actively negotiating with various potential bidders and may be in a position to enter into a binding stalking horse agreement in short order. While the Debtors do not seek authority pursuant to the Motion to enter into one or more stalking horse agreements, they may do so on an expedited basis pursuant to a separate motion and order (including any bid protections that may be provided therein). Upon conclusion of the Auction and selection of the highest or otherwise best bid(s), the Debtors request that the Court holds the Sale Hearing and enter the Sale Order authorizing and approving the Sale free and clear of Interests (subject to the Successful APA). At the Sale Hearing, the Debtors will also seek approval pursuant to section 365 of the Bankruptcy Code of the assumption and assignment of the relevant executory contracts and/or unexpired leases to the Successful Bidder(s) for the Assets. The Debtors seek to promptly effectuate the court-supervised marketing and auction process. One of the goals of the Debtors in obtaining approval of the DIP Facility was to obtain funds necessary to effectuate the Sale Transaction. Furthermore, given the Debtors' current cash on hand, without the Sale Transaction and access to the proceeds thereof, the Debtors would not be able to fund their operations or repay the DIP Facility or their creditors, thereby causing immediate and irreparable harm to the Debtors' estates. An expeditious sale process is also necessary to stabilize the Debtors' business and provide assurances to existing payors, borrowers, and vendors. With this in mind, the Debtors developed the Bidding Procedures, which are designed to preserve flexibility in this sale process, facilitate a quick, but fair, process, and generate the highest or best value for the Assets. The proposed deadlines in the Bidding Procedures create an appropriate timetable for the Sale, and are consistent with the Debtors' current liquidity position and the milestones under the DIP Facility. For the reasons set forth herein, the Debtors submit that the relief requested is in the best interest of the Debtors, their estates, creditors, and other parties in interest, and therefore should be granted. The Debtors propose the following deadlines for the Sale: a. Sept. 15, 2021, at 9:30 a.m. (ET) - Hearing to consider approval of Bidding Procedures and entry of Bid Procedures Order b. Sept. 24, 2021, at 11:59 p.m. (ET) - Deadline for the Debtors to file and serve Sale Notice and Assumption and Assignment Notice c. Sept. 30, 2021, at 4:00 p.m. (ET) - Deadline for the interested parties to submit non-binding indications of interest d. Oct. 14, 2021, at 11:59 p.m. (ET) - Deadline to file form of Proposed Sale Order e. Oct. 25, 2021, at 4:00 p.m. (ET) - Cure Objection Deadline f. Oct. 26, 2021, at 4:00 p.m. (ET) - Bid Deadline: Final deadline to submit a Bid and Good Faith Deposit g. Oct. 28, 2021, at 10:00 a.m. (ET) - Auction to be held in a virtual room hosted by the Debtors' counsel or as otherwise communicated to Qualified Bidders and Consultation Parties h. One Business Day after conclusion of Auction - Deadline to file the Post Auction Notice i. Nov. 5, 2021, at 4:00 p.m. (ET) - Sale Objection Deadline j. Nov. 10, 2021, at 4:00 p.m. (ET) - Deadline to file replies in support of Sale Transaction and in response to any Adequate Assurance Objections k. Nov. 16, 2021, at 1:00 p.m. (ET) - Sale Hearing The other salient terms of the Bidding Procedures are: a. Initial Bid: TBA b. Deposit: 5% of the purchase price c. Bid Increments: $1 million d. Credit Bidding: Nothing will limit the rights of (i) holders of secured claims to credit bid pursuant and subject to section 363(k) of the Bankruptcy Code or (ii) any party in interest to object to any such credit bid on any grounds, and all such rights are reserved. If any credit bid is submitted, the Debtors may modify the Bidding Procedures, in consultation with the Consultation Parties, as may be necessary and appropriate to account for such credit bid. The sale will be free and clear of Liens, Claims, Interests, and Encumbrances. The Debtors propose the following Assumption and Assignment Procedures for notifying counterparties to executory contracts and unexpired leases of potential cure amounts in the event they decide to assume such contracts or leases. By no later than Sept. 24, 2021, the Debtors will file with the Court, post on the case website, and serve on each non-debtor counterparty to the proposed Assigned Contracts. The Cure Objection Deadline is Oct. 25, 2021 at 4:00 p.m. (ET). Within three Business Days after the entry of the Order, or as soon thereafter as practicable, the Debtors (or their agents) shall serve the Order and the Bidding Procedures upon the Notice Parties. To implement the foregoing successfully, and given the nature of the relief requested, the Debtors request that the Court finds that notice of the Motion is adequate under Bankruptcy Rule 6004(a) and waives the 14-day stay of an order authorizing the use, sale or lease of property and the assumption and assignment of executory contracts and unexpired leases under Bankruptcy Rules 6004(h) and 6006(d) is waived. About Alpha Latam Management Alpha Latam Management LLC, et al., operate a specialty finance business that offers consumer and small business lending services to underserved communities in Mexico and Colombia. Alpha Latam Management LLC and certain of its affiliates sought Chapter 11 protection (Bankr. D. Del. Case No. 21-11109) on August 1, 2021. In the petition signed, Alpha Latam Management estimated assets of between $100 million and $500 million and estimated liabilities of between $500 million and $1 billion. RICHARDS, LAYTON & FINGER, P.A., led by Mark D. Collins, is the Debtors' counsel. ROTHSCHILD & CO. is the investment banker and ALIXPARTNERS LLP is the financial advisor. PRIME CLERK LLC is the claims agent. Alpha Holding, S.A. de C.V. and AlphaCredit Capital, S.A. de C.V. SOFOM, ENR ("AlphaCredit", together with Alpha Holding, the "Mexican Debtors")) on August 11, 2021, commenced in Mexico City a jointly administered voluntarily filed proceeding pursuant to the Ley de Concursos Mercantiles. Through this proceeding, the Mexican Debtors intend to pursue a controlled restructuring and possible sale of their assets in order to maximize value of the Mexican Debtors for the benefit of their creditors and other stakeholders. SEADRILL LTD: Enters Into Restructuring Deed w/ SeaMex Liquidators ------------------------------------------------------------------ Seadrill Limited (OSE: SDRL, OTCPK:SDRLF) and Seadrill New Finance Limited ("Issuer) announced Aug. 31, 2021, the entry into a restructuring implementation deed (the "RID") by, among others, the joint provisional liquidators of SeaMex Ltd. (in provisional liquidation), and the refinancing of the SeaMex senior secured bank debt by the issuance of new senior secured notes (the "New SeaMex Notes"). SeaMex is a 50/50 joint venture entered into by one of the Issuer's subsidiaries, Seadrill JU Newco Bermuda Ltd. These are the next key steps in the restructuring of SeaMex. For further details on the SeaMex restructuring, please refer to the 2 July Announcement. The RID sets out the steps required to implement the SeaMex restructuring. A key step in the RID is the sale of the assets of SeaMex out of provisional liquidation to a newly incorporated wholly owned subsidiary of the Issuer ("NewCo"). The share purchase agreement, which will effect this sale, is in agreed form and is expected to be entered into by the relevant parties shortly. The key terms of the share purchase agreement and related documentation include: -- SeaMex sells substantially all of its assets to NewCo in return for: * NewCo assuming substantially all of SeaMex's liabilities * Release of the guarantee provided by SeaMex in respect of the New SeaMex Notes, with NewCo acceding as guarantor in respect of the New SeaMex Notes * Release of a substantial part of certain debt owed by SeaMex to one of the Issuer's indirect subsidiaries, Seadrill SeaMex SC Holdco Limited ("SC Holdco"), with a material amount remaining owing by SeaMex as part of the agreed implementation steps -- Certain other customary provisions including certain releases and indemnities from the SeaMex group in relation to the SPA -- The completion of the sale is subject to certain customary conditions, including certain antitrust approvals In addition, as part of the steps set out by the RID, certain of the debt owed by SeaMex to SC Holdco is being accelerated as part of the orderly implementation of the SeaMex restructuring given the objective to release a substantial part of this debt as partial consideration for the sale of the SeaMex assets. The RID also contains certain customary provisions, including certain customary releases. The key terms of the New SeaMex Notes are: Amount: c. $219m (including upfront fee) Tenor: 3 years with call protection Rate: 12% PIYC and payable quarterly Collateral: secured on a senior basis by substantially all the assets of the SeaMex group Ability to upsize: additional uncommitted shelf note facility in an aggregate principal amount of up to $120m For further details regarding the key terms of the New SeaMex Notes, please refer to the commercial term sheet exhibited to the 2 July Announcement. This announcement relates to the restructuring and refinancing of SeaMex. It remains the case that under Seadrill Limited's plan of reorganisation (the "Plan") existing shareholders of Seadrill Limited will receive 0.25% of the new equity, subject to dilution, if classes 4 and 6 of Seadrill Limited's creditors vote to accept the Plan, and otherwise will not receive any recovery. Consummation of the Plan is subject to a number of customary terms and conditions, including court approval. About Seadrill Ltd. Seadrill Limited (OSE:SDRL, OTCQX:SDRLF) -- http://www.seapdrill.com/-- is a deepwater drilling contractor providing drilling services to the oil and gas industry. As of March 31, 2018, it had a fleet of over 35 offshore drilling units that include 12 semi-submersible rigs, 7 drillships, and 16 jack-up rigs. On Sept. 12, 2017, Seadrill Limited sought Chapter 11 protection after reaching terms of a reorganization plan that would restructure $8 billion of funded debt. It emerged from bankruptcy in July 2018. Demand for exploration and drilling has fallen further during the COVID-19 pandemic as oil firms seek to preserve cash, idling more rigs and leading to additional overcapacity among companies serving the industry. In June 2020, Seadrill wrote down the value of its rigs by $1.2 billion and said it planned to scrap 10 rigs. Seadrill said it is in talks with lenders on a restructuring of its $5.7 billion bank debt. Seadrill Partners LLC, a limited liability company formed by deep-water drilling contractor Seadrill Ltd. to own, operate and acquire offshore drilling rigs, along with its affiliates, sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 20-35740) on Dec. 1, 2020, after its parent company swept one of its bank accounts to pay disputed management fees. Mohsin Y. Meghji, authorized signatory, signed the petitions. On Feb. 7, 2021, Seadrill GCC Operations Ltd., Asia Offshore Drilling Limited, Asia Offshore Rig 1 Limited, Asia Offshore Rig 2 Limited, and Asia Offshore Rig 3 Limited sought Chapter 11 protection. Seadrill GCC estimated $100 million to $500 million in assets and liabilities as of the bankruptcy filing. Additionally, on Feb. 10, 2021, Seadrill Limited and 114 affiliated debtors each filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code with the Court. The lead case is In re Seadrill Limited (Bankr. S.D. Tex. Case No. 21-30427). Seadrill Limited disclosed $7.291 billion in assets against $7.193 billion in liabilities as of the bankruptcy filing. In the new Chapter 11 cases, the Debtors tapped Kirkland & Ellis LLP as counsel; Houlihan Lokey, Inc. as financial advisor; Alvarez & Marsal North America, LLC as restructuring advisor; Jackson Walker LLP as co-bankruptcy counsel; Slaughter and May 2021 as co-corporate counsel; Advokatfirmaet Thommessen AS as Norwegian counsel; and Conyers Dill & Pearman as Bermuda counsel. Prime Clerk LLC is the claims agent. On April 9, 2021, the board of directors of Debtor Seadrill North Atlantic Holdings Limited unanimously adopted resolutions appointing Steven G. Panagos and Jeffrey S. Stein as independent directors to the board. Seadrill North Atlantic Holdings Limited tapped Katten Muchin Rosenman LLP as counsel and AMA Capital Partners, LLC as financial advisor at the sole direction of independent directors. =============== P A R A G U A Y =============== PARAGUAY: Pandemic Stimulus Ending as the Economy Bounces Back -------------------------------------------------------------- globalinsolvency.com, citing Bloomberg News, reports that Paraguay will continue to dial back pandemic stimulus next year as a fast growing economy cushions austerity measures that have proved unpopular in other South American countries. The government has already reduced temporary pandemic cash transfers to people working in the country's vast informal sector without triggering social unrest, Finance Minister Oscar Llamosas said in an interview, according to the report. "The task of adjusting fiscal accounts was largely done this year, and the idea is to continue that in next year's budget," Llamosas said, the report notes. "The state will have to continue helping people and businesses that are most in need." Weaning voters off pandemic era stimulus is proving a challenge in the region with Brazil signaling it might breach its spending cap next year and Argentina continuing to print money even at the cost of double-digit inflation, the report relays. Llamosas' goal of narrowing the deficit could face political headwinds ahead of presidential primaries and general elections during the next two years, the report discloses. ===================================== T R I N I D A D A N D T O B A G O ===================================== TRINIDAD & TOBAGO: Forex Reserves Get US$644 Million Boost ---------------------------------------------------------- Trinidad Express reports that Trinidad and Tobago's foreign reserves have received the equivalent of a US$644 million boost, Finance Minister Colm Imbert has said. This "as a result of a global distribution by the (International Monetary Fund) of Special Drawing Rights designed to help countries cope with the forex demands of Covid-19", Imbert tweeted, according to Trinidad Express. "Our net foreign reserves are now back over US$7 billion," he stated, the report notes. On August 2, the board of governors of the IMF announced it had approved a general allocation of Special Drawing Rights (SDRs) equivalent to US$650 billion (about SDR 456 billion) to boost global liquidity, the report relays. "This is a historic decision - the largest SDR allocation in the history of the IMF and a shot in the arm for the global economy at a time of unprecedented crisis. "The SDR allocation will benefit all members, address the long-term global need for reserves, build confidence, and foster the resilience and stability of the global economy. "It will particularly help our most vulnerable countries struggling to cope with the impact of the Covid-19 crisis," IMF managing director Kristalina Georgieva said in a statement from Washington, the report discloses. The general allocation of SDRs became effective, the report notes. The newly created SDRs are being credited to IMF member countries in proportion to their existing quotas in the Fund, the report notes. About US$275 billion of the new allocation will go to emerging markets and developing countries, including low-income countries, the IMF said, the report relays. "We will also continue to engage actively with our membership to identify viable options for voluntary channeling of SDRs from wealthier to poorer and more vulnerable member countries to support their pandemic recovery and achieve resilient and sustainable growth," Georgieva said, the report discloses. One key option is for members that have strong external positions to voluntarily channel part of their SDRs to scale up lending for low-income countries through the IMF's Poverty Reduction and Growth Trust (PRGT), the IMF stated, the report notes. What is an SDR The SDR is an international reserve asset created by the IMF to supplement the official reserves of its member countries. The SDR is not a currency. It is a potential claim on the freely usable currencies of IMF members. As such, SDRs can provide a country with liquidity. A basket of currencies defines the SDR: the US dollar, Euro, Chinese yuan, Japanese yen and the British pound. ********* 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. 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