/raid1/www/Hosts/bankrupt/TCRLA_Public/240212.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
L A T I N A M E R I C A
Monday, February 12, 2024, Vol. 25, No. 31
Headlines
A R G E N T I N A
ARGENTINA: Inflation in Buenos Aires City Hit 21.7% in January
ARGENTINA: Milei's Economic Reforms Stall in Congress
CLISA: Fitch Lowers LongTerrm Issuer Default Ratings to 'C'
GAUCHO GROUP: Noteholder Hikes Beneficial Ownership Cap to 9.99%
B A H A M A S
FTX GROUP: Estate Sold 2/3 of Grayscale Bitcoin Trust Shares
FTX GROUP: Unloads CryptoAssets to Funds to Pay Back Customers
B R A Z I L
BRAZIL: Narrows Current Account Deficit to 1.32% of GDP
BRAZIL: Sharp Rise in Local Business Bankruptcy Requests
GOL LINHAS: Fitch Lowers LongTerm IDR to 'D' on Bankruptcy Filing
[*] BRAZIL: Services Sector Sees Steady Growth in 2023
C A Y M A N I S L A N D S
WM CAYMAN II: Fitch Assigns 'BB-' First-Time IDR, Outlook Stable
C O L O M B I A
AVIANCA GROUP: S&P Withdraws 'B-' Issuer Credit Rating
EMPRESA DE TELECOMUNICACIONES: Fitch Affirms 'BB+' LongTerm IDRs
P A R A G U A Y
AGENCIA FINANCIERA: S&P Affirms 'BB' ICR Amid Upgrade of Sovereign
T R I N I D A D A N D T O B A G O
CONSOLIDATED ENERGY: Fitch Assigns 'BB-' Rating on Sr. Unsec. Notes
CONSOLIDATED ENERGY: Fitch Assigns BB- LongTerm IDR, Outlook Stable
CONSOLIDATED ENERGY: Moody's Alters Outlook on 'B1' CFR to Negative
V E N E Z U E L A
MERCANTIL BANCO: Fitch Affirms & Then Withdraws 'CC' LongTerm IDRs
X X X X X X X X
[*] BOND PRICING COLUMN: For the Week Feb. 5 to Feb. 9, 2024
- - - - -
=================
A R G E N T I N A
=================
ARGENTINA: Inflation in Buenos Aires City Hit 21.7% in January
--------------------------------------------------------------
Buenos Aires Times reports that inflation in Buenos Aires City
climbed to 21.7 percent last month, driven by hikes in food, fuel
and transport, as reported by City Hall.
Data from City Hall's Statistics and Census Directorate for January
shows that consumer prices accumulated a 238.5-percent rise over
the last 12 months, according to Buenos Aires Times.
The government agency's report indicates that inflation accelerated
last month, rising 0.6 points from the 21.1 percent recorded in
December, the report notes.
The sector which increased the most in January was personal care,
social protection and other products, rising 35.7 percent, the
report relays
Transport rose by 33.7 percent, given increases in transport fares,
fuels and airline tickets, while food and non-alcoholic beverages
on average increased by 25.4 percent, the report discloses.
Increases in the latter category were driven by bread and cereals
(27.9 percent), milk, dairy and eggs (28.1 percent), and meat and
meat-related products (17.2 percent), the report says.
Outpacing the monthly rate, restaurants and hotels rose 24.1
percent, the report relays. recreation and culture averaged a
30.5-percent increase, due to rises in travel packages, and
healthcare soared 30 percent thanks to adjustments in the fees of
private health insurance firms, the report notes.
Utilities such as housing, water, electricity, gas, etc. rose by 10
percent the first month of 2024, the report says.
According to City Hall, food and drink, transport, restaurants and
hotels, healthcare, housing, utilities and recreation accounted for
more than three-quarters of the overall monthly figure for January,
the report discloses.
Year-on-year, food and non-alcoholic beverages, housing, water,
electricity, gas and other fuels, restaurants and hotels and
transport were the sectors driving hikes, accounting for 60 percent
of price variations over the last 12 months, the body added, the
report notes.
Overall, goods rose by 24.2 percent last month, outpacing services,
which increased by 19.6 percent, the report relays.
Consumer prices nationwide have soared by 211 percent over the last
12 months in Argentina, the report discloses. The national
government, via its INDEC national statistics bureau, will reveal
February 14 the inflation figure for last month, the report notes.
Economy Minister Luis Caputo has forecast a figure of around 20
percent, which would be a deceleration on the 25.5 percent monthly
rate recorded in December, the report adds.
About Argentina
Argentina is a country located mostly in the southern half of South
America. Its capital is Buenos Aires. Javier Milei is the current
president of Argentina after winning the November 19, 2023 general
election. He succeeded Alberto Angel Fernandez in the position.
Argentina has the third largest economy in Latin America. The
country's economy is an upper middle-income economy for fiscal year
2019, according to the World Bank. Historically, however, its
economic performance has been very uneven, with high economic
growth alternating with severe recessions, income maldistribution
and in the recent decades, increasing poverty.
The IMF's executive board completed on August 23, 2023, the fifth
and six reviews of Argentina's 30-month Extended Fund Facility
(EFF), and approved a US$7.5-billion disbursement to Argentina as
part of the larger program, which refinances payments Argentina
owes the institution from a previous bailout that failed to
stabilize the economy in 2018. Argentina would receive another IMF
disbursement in November of about US$2.75 billion pending another
staff-level agreement and board approval.
S&P Global Ratings, on June 13, 2023, raised its local currency
sovereign credit ratings on Argentina to 'CCC-/C' from 'SD/SD' and
0its national scale rating to 'raCCC+' from 'SD'. S&P also affirmed
its 'CCC-/C' foreign currency sovereign credit ratings on
Argentina. The outlook on the long-term ratings is negative. S&P's
'CCC-' transfer and convertibility assessment is unchanged. None of
its rated bond issues are affected.
S&P said the negative outlook on the long-term ratings is based on
the risks surrounding pronounced economic imbalances and policy
uncertainties before and after the 2023 national elections.
Divisions within the government coalition, and infighting among the
opposition, constrain the sovereign's ability to implement timely
changes in economic policy.
Fitch Ratings also upgraded on June 13, 2023, Argentina's Long-Term
Foreign Currency (FC) Issuer Default Rating (IDR) to 'CC' from
'C'and affirmed the Long-Term Local Currency (LC) IDR at 'CCC-'.
Fitch typically does not assign Outlooks to sovereigns with a
rating of 'CCC+' or below.
The upgrade of the FC IDR reflects that Fitch no longer deems a
default-like process to have begun, as the authorities have not
signaled a clear intention to follow through with an intra-public
debt swap announced in March. The new 'CC' rating signals a default
event of some sort appears probable in the coming years, regardless
of the outcome of upcoming elections. The affirmation of the LC IDR
at 'CCC-' follows the peso debt swap in June that Fitch did not
deem to be a "distressed debt exchange" (DDE).
Moody's Investors Service, in September 2022, affirmed Argentina's
Ca foreign-currency and local-currency long-term issuer and senior
unsecured ratings. The outlook remains stable. The decision to
affirm the Ca ratings balances Argentina's limited market access,
weak governance, and history of recurrent debt restructurings with
recent efforts to marshal fiscal and monetary measures to start
addressing underlying macroeconomic imbalances in the context of
the IMF program that was approved in 2022, according to Moody's.
DBRS, Inc. confirmed Argentina's Long-Term Foreign Currency Issuer
Rating at CCC and downgraded its Long-Term Local Currency Issuer
Rating to CCC from CCC (high) on March 3, 2023.
ARGENTINA: Milei's Economic Reforms Stall in Congress
-----------------------------------------------------
Buenos Aires Times reports that resident Javier Milei's sweeping
'omnibus' reform package was dealt a major setback as lawmakers in
Congress prevented it from advancing and the bill was promptly
returned to committee stage for a rewrite.
The drama came despite the bill winning general approval in the
lower house, according to Buenos Aires Times. However, as
lawmakers began voting on the mega-reform bill article by article,
it became clear that the government did not have the numbers to
pass key sections, the report notes.
Just as the Chamber of Deputies was preparing for a vote, the head
of the La Libertad Avanza caucus in the lower house requested and
obtained the adjournment of the session, the report relays.
Oscar Zago, leader of the ruling party caucus, called for the bill
"to go back to committee" in a motion passed by lawmakers that left
the Milei's sweeping economic reform bill - which includes
privatisations and the revamping of the penal code - up in the air,
the report discloses.
"The governors [of the provinces] did not keep their word," he
declared, the report says.
The matter is being sent "back to committee" for further dialogue,
Zago added, while denying that the move was a failure for President
Milei.
The new hurdle for the package, which won approval in principle
pending further examination, was put up as Milei was on a trip to
Israel, the report relays.
The president responded furiously to the news, the report notes.
"Our government programme was voted for by 56 percent of Argentines
and we are not willing to negotiate it with those who destroyed the
country," the far-right leader said in a post on the X social
network from Israel, where he is on an official visit, the report
relays.
"We know that it will not be easy to change a system in which
politicians have enriched themselves at the expense of Argentines,"
he added.
Presidential Spokesperson Manuel Adorni said that work on the
package would continue and insisted that cuts to government
spending will still have to be made, the report discloses.
"All government expenses will have to be reviewed to comply with
President Milei's order, which is zero deficit," Adorni told the
LN+ channel, the report relays.
Members of the opposition celebrated what they saw as a victory,
the report notes.
"A political defeat for the government," said Peronist lawmaker
Leandro Santoro, referring to the drama in parliament as
"unprecedented ridicule" for the government, the report notes.
Left-wing lawmaker Myriam Bregman told reporters that "this means
they [the government] have to start from scratch," the report
relays.
"The popular repudiation [of Milei's reforms] was felt throughout
the country," she continued, referring to protests that occurred in
front of Congress during debate on the bill, the report discloses.
Bill's Future Unsure
The 'Omnibus Law' won general approval in the Chamber of Deputies,
though lawmakers planned to vote on its articles one-by-one in the
session, the report relays.
The bill's key points include the delegation of emergency powers to
Milei allowing him to govern by decree and sweeping state reform,
including the privatizations of tens of state firms, the report
notes. Initially containing 660 provisions covering the economy,
trade, culture, criminal law, even football clubs, the bill has
since been whittled down to around 300 articles, the report relays.
The future of Milei's deeply controversial reform package - known
formally as the "Ley de Bases y Puntos de Partida para La Libertad
de los Argentinos" - is now unknown, the report notes.
Milei has previously vowed to toughen austerity measures should the
bill not pass Congress and even to put it to the people in a
referendum, the report notes.
The president's office said in a second statement issued that
provincial governors had taken "the decision to destroy" the bill
and accused them of "betraying their voters," the report
discloses.
In the marathon congressional sessions addressing the bill, the
government was still negotiating articles with its allies even as
the legislation was being debated, the report relays.
Lawmakers did not receive a final copy of its text until the second
day of sessions, the report notes.
Earlier, the deputies present had approved special "delegated
powers" for Milei, which would allow him to govern by decree for at
least one year, though opposition lawmakers managed to reduce its
scope, the report notes.
"We are afraid of a weak democracy, which concentrates in a single
person the possibility of extorting companies, organisations and
citizens and ends up leaving us all defenceless," said Coalicion
Civica ARI deputy Paula Oliveto, the report relays.
The original text of the law promoted the far-right idea of
"limiting all state intervention that is not necessary to ensure
the effective exercise of their constitutional rights," the report
relays.
The government received narrow support (134 to 121 votes) for the
declaration of an economic, financial, security, tariff, energy and
administrative emergency. The opposition forced the withdrawal of
declarations of fiscal, social security and health emergencies, the
report adds.
About Argentina
Argentina is a country located mostly in the southern half of South
America. Its capital is Buenos Aires. Javier Milei is the current
president of Argentina after winning the November 19, 2023 general
election. He succeeded Alberto Angel Fernandez in the position.
Argentina has the third largest economy in Latin America. The
country's economy is an upper middle-income economy for fiscal year
2019, according to the World Bank. Historically, however, its
economic performance has been very uneven, with high economic
growth alternating with severe recessions, income maldistribution
and in the recent decades, increasing poverty.
The IMF's executive board completed on August 23, 2023, the fifth
and six reviews of Argentina's 30-month Extended Fund Facility
(EFF), and approved a US$7.5-billion disbursement to Argentina as
part of the larger program, which refinances payments Argentina
owes the institution from a previous bailout that failed to
stabilize the economy in 2018. Argentina would receive another IMF
disbursement in November of about US$2.75 billion pending another
staff-level agreement and board approval.
S&P Global Ratings, on June 13, 2023, raised its local currency
sovereign credit ratings on Argentina to 'CCC-/C' from 'SD/SD' and
0its national scale rating to 'raCCC+' from 'SD'. S&P also affirmed
its 'CCC-/C' foreign currency sovereign credit ratings on
Argentina. The outlook on the long-term ratings is negative. S&P's
'CCC-' transfer and convertibility assessment is unchanged. None of
its rated bond issues are affected.
S&P said the negative outlook on the long-term ratings is based on
the risks surrounding pronounced economic imbalances and policy
uncertainties before and after the 2023 national elections.
Divisions within the government coalition, and infighting among the
opposition, constrain the sovereign's ability to implement timely
changes in economic policy.
Fitch Ratings also upgraded on June 13, 2023, Argentina's Long-Term
Foreign Currency (FC) Issuer Default Rating (IDR) to 'CC' from
'C'and affirmed the Long-Term Local Currency (LC) IDR at 'CCC-'.
Fitch typically does not assign Outlooks to sovereigns with a
rating of 'CCC+' or below.
The upgrade of the FC IDR reflects that Fitch no longer deems a
default-like process to have begun, as the authorities have not
signaled a clear intention to follow through with an intra-public
debt swap announced in March. The new 'CC' rating signals a default
event of some sort appears probable in the coming years, regardless
of the outcome of upcoming elections. The affirmation of the LC IDR
at 'CCC-' follows the peso debt swap in June that Fitch did not
deem to be a "distressed debt exchange" (DDE).
Moody's Investors Service, in September 2022, affirmed Argentina's
Ca foreign-currency and local-currency long-term issuer and senior
unsecured ratings. The outlook remains stable. The decision to
affirm the Ca ratings balances Argentina's limited market access,
weak governance, and history of recurrent debt restructurings with
recent efforts to marshal fiscal and monetary measures to start
addressing underlying macroeconomic imbalances in the context of
the IMF program that was approved in 2022, according to Moody's.
DBRS, Inc. confirmed Argentina's Long-Term Foreign Currency Issuer
Rating at CCC and downgraded its Long-Term Local Currency Issuer
Rating to CCC from CCC (high) on March 3, 2023.
CLISA: Fitch Lowers LongTerrm Issuer Default Ratings to 'C'
-----------------------------------------------------------
Fitch Ratings has downgraded CLISA - Compania Latinoamericana de
Infraestructura y Servicios' (CLISA) Long-Term Foreign and Local
Currency Issuer Default Ratings (IDRs) to 'C' from 'CCC-'. In
addition, Fitch has downgraded CLISA's senior secured bond maturing
July 2027 to 'C'/'RR4' from 'CCC-'/'RR4'.
The ratings reflect Fitch's view that a default-like process has
begun as a result of CLISA's consent solicitation to change the
terms of payment of the coupon that was due on Jan. 25, 2024 for
the 2027 bond. If CLISA is successful in its consent solicitation
and the terms of the coupon payment are amended or the coupon
payment is not made within the grace period, Fitch will downgrade
the ratings to 'RD' to reflect a Restricted Default.
KEY RATING DRIVERS
Consent Solicitation for the 2027 Bond Coupon: CLISA announced a
consent solicitation on Jan. 11, 2024, to change the terms of
payment for the 2027 bond coupon due Jan. 25, 2024. The company is
proposing an amendment of the terms of payment for this coupon from
6.25% in cash and 2.25% Payment-In-Kind (PIK) to 0% cash and 8.5%
PIK. The consent solicitation expires on Feb. 9, 2024. The notes
have a 30-day grace period for the coupon payment. Fitch views this
consent solicitation as a breach of the terms originally agreed
upon under the 2027 bond indenture. As such, Fitch believes a
default-like process has begun.
Liquidity Constraints and Refinancing Risk: CLISA's liquidity is
likely to deteriorate as Argentina faces major economic challenges,
which may impact the payment capacity of CLISA's primary clients,
the local governments. Fitch expects leverage to increase over 4x
in 2024. Under these conditions, refinancing risks for CLISA will
increase, in particular as the coupon payment rate steps-up and the
PIK option fades out on their 2027 bond by the end of 2024.
CLISA has a tight liquidity profile, in great part due to its
significant working capital needs from the prolonged period of
repayments for its receivables in relation to its payables. The
company usually manages this with a combination of short- and
long-term financing that regularly pressures the company's leverage
metrics and liquidity profile. Fitch does not expect this to change
in the near future, given the operating environment in Argentina
and the company's counterparty profile. As a result, the company
will remain pressured to refinance existing debt into the future,
with limited options in both the local and international markets.
Significant Counterparty Risk: CLISA's ratings incorporate the
company's exposure to high counterparty risk, which is closely
linked to the Argentine public sector, as 80% to 90% of the
company's revenues come from various municipalities and provinces.
The more stable waste management business accounts for the majority
of this figure.
The company's construction business is highly dependent upon
projects developed by federal, provincial and municipal
governments. CLISA also faces contract renewal risk, which stems
from regular negotiations of public service contracts. The company
is vulnerable to delays in collection with the public sector as a
major client. The suspension of public sector contracts and funding
for public works is likely to exacerbate the risks for CLISA.
Market Position and Diversification: CLISA has a strong market
position and is one of Argentina's largest privately-owned
conglomerates, with businesses in various public infrastructure
sectors. The company generates 64% of its EBITDA from its Waste
Management segment. Construction is the second-largest contributor,
representing roughly 33% of EBITDA. Approximately 60% of
construction revenues originate from Argentina, the remaining
portion originates largely from contracts in Peru, Paraguay, and,
to a lesser extent, Brazil. Transportation and Water Supply
represent the balance of their EBITDA generation.
DERIVATION SUMMARY
CLISA maintains an important business position in Argentina's waste
management industry, serving the city of Buenos Aires and other
cities and counties such as Santa Fe, Neuquen and San Isidro. In
addition, the company is an experienced, well-positioned operator
in the construction sector. CLISA also continues to operate the
City of Buenos Aires' subway network under a 12-year contract,
which should provide a relatively stable revenue stream.
Profitability in the Transportation segment will depend on how
efficient CLISA becomes at managing the subway system. In Fitch's
view, these last two business segments are the most likely to
generate improvements in the company's overall financial profile,
but are challenged by the current economic environment in
Argentina.
CLISA's profitability is lower than Companhia de Saneamento Basico
do Estado de Sao Paulo (SABESP; BB+/Stable). The company's overall
EBITDA margin as of the LTM ended 3Q 2023 was 10.3%, while its
Waste Management division had margins of 23%. SABESP's EBITDA
margin was around 41.7% in the same period; CLISA, however,
compares much more favorably against Aguas y Saneamientos
Argentinos S.A. (CCC-), which has a loss-making operation.
In terms of credit metrics, CLISA also underperforms SABESP and
outperforms Aguas y Saneamientos. CLISA's gross leverage stood at
3.9x debt/EBITDA while SABESP was 2.4x as of LTM 3Q2023. Similarly,
CLISA's operating profile is weaker with an under 2x FFO interest
coverage ratio compared with SABESP's 3.4x for the same period.
Aguas y Saneamientos is significantly weaker in this respect with a
loss-generating operation that requires capital injections from its
shareholders and has more pressing refinancing risks.
Fitch also views CLISA's credit profile as much weaker than its
U.S. peers in the waste management industry such as Waste
Management Inc. (A-/Stable) and Waste Connection Inc. (A-/Stable).
These companies have stronger scale, margins, FCF generation,
leverage and operating environment.
KEY ASSUMPTIONS
- Revenues remain stable in 2023 but deteriorate in 2024 due to
lower construction revenues and payment delays;
- EBITDA margins stable at 12%;
- Waste Management remains at historical margins of approximately
25% and Transportation has just a marginal contribution to EBITDA;
- Capex of USD40 million in 2023 and then USD30 million per year;
- Company continues using PIK option for interest payments on the
2027 bonds through 2024;
- Company's short-term debt is rolled over and CLISA maintains at
least USD40 million in cash;
- No dividends paid.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- Fitch could reassess the IDRs upon the completion of the consent
solicitation period. The updated IDRs would reflect the resulting
credit profile of the issuer;
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- A downgrade of the rating to RD will occur if the company changes
the terms of payment via consent solicitation and/or misses it
coupon payment on the expiration of the payment grace period.
LIQUIDITY AND DEBT STRUCTURE
Impaired Liquidity Position: The 'C' rating reflects an impaired
liquidity position following the deterioration of the operating
environment in Argentina and significant delays from counterparty
payments in that country. This has forced the company to begin a
Consent Solicitation to change the terms of payment of the coupon
of its 2027 bond maturity that was due in Jan. 25, 2024.
As of September 2023, the company had readily available cash in
hand of ARS9.5 billion and short-term debt of ARS34.4 billion.
Fitch notes that about three quarters of the cash is tied to
projects and other operations. Short-term debt consisted of the
BRCC notes amortization, self-liquidating debt and revolving
facilities. Self-Liquidating facilities are receivables factoring
like transactions with recourse to the company.
The amount outstanding on the 2027 is in excess of USD340 million.
These bonds have a bullet payment and include a step-up coupon that
goes from 5.25% in 2022 to 10.5% in 2024 with an option to PIK a
portion of the interest payment until 2024. As part of the
exchange, the security and covenants from the old 2023 bonds were
removed. The USD10.1 million balance of the 2023 bonds was paid in
July 2023.
The company also renegotiated its privately placed 12.7% notes
under the Benito Roggio construction unit in Peru. The balance is
USD15 million for these notes and will be paid on equal quarterly
instalments with a final payment of USD3 million in November 2024.
These last notes are not subject to Argentina's capital controls.
ISSUER PROFILE
CLISA is a leading Argentine infrastructure management and
development company in business for over 100 years. The company is
organized into four main business segments: Construction and Road
Concessions, Waste Management, Transportation and Water Services.
The company provides services to both the public and private
sectors, but is mostly focused on public infrastructure.
ESG CONSIDERATIONS
CLISA-Compania Latinoamericana de Infraestructura y Servicios has
an ESG Relevance Score of '4' for Governance Structure due to
ownership concentration, which has a negative impact on the credit
profile, and is relevant to the ratings in conjunction with other
factors.
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' 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. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Entity/Debt Rating Recovery Prior
----------- ------ -------- -----
CLISA-Compania Latinoamericana
de Infraestructura y Servicios
LT IDR C Downgrade CCC-
LC LT IDR C Downgrade CCC-
senior secured LT C Downgrade RR4 CCC-
GAUCHO GROUP: Noteholder Hikes Beneficial Ownership Cap to 9.99%
----------------------------------------------------------------
Gaucho Group Holdings, Inc. disclosed in a Form 8-K filed with the
Securities and Exchange Commission that effective Feb. 5, 2024,
pursuant to the Senior Secured Convertible Note issued by the
Company to that certain investor on Feb. 21, 2023, the Holder
elected to increase the cap on its beneficial ownership of the
Company from 4.99% to 9.99% per Section 3(d)(i) of the Note by
providing written notice to the Company. Such increase in the
Maximum Percentage will not be effective until the 61st day after
such notice is delivered to the Company.
About Gaucho Group
Headquartered in New York, NY, Gaucho Group Holdings, Inc. was
incorporated on April 5, 1999. Effective Oct. 1, 2018, the Company
changed its name from Algodon Wines & Luxury Development, Inc. to
Algodon Group, Inc., and effective March 11, 2019, the Company
changed its name from Algodon Group, Inc. to Gaucho Group Holdings,
Inc. Through its wholly-owned subsidiaries, GGH invests in,
develops and operates real estate projects in Argentina. GGH
operates a hotel, golf and tennis resort, vineyard and producing
winery in addition to developing residential lots located near the
resort. In 2016, GGH formed a new subsidiary, Gaucho Group, Inc.
and in 2018, established an e-commerce platform for the manufacture
and sale of high-end fashion and accessories. In February 2022,
the Company acquired 100% of Hollywood Burger Argentina, S.R.L.,
now Gaucho Development S.R.L ("GD"), through InvestProperty Group,
LLC and Algodon Wine Estates S.R.L., which is an Argentine real
estate holding company. In addition to GD, the activities in
Argentina are conducted through its operating entities:
InvestProperty Group, LLC, Algodon Global Properties, LLC, The
Algodon Recoleta S.R.L, Algodon Properties II S.R.L., and Algodon
Wine Estates S.R.L. Algodon distributes its wines in Europe under
the name Algodon Wines (Europe). On March 20, 2020, the Company
formed a wholly-owned Delaware subsidiary corporation, Bacchus
Collection, Inc., which was dissolved on March 23, 2021. On June
14, 2021, the Company formed a wholly-owned Delaware limited
liability company subsidiary, Gaucho Ventures I Las Vegas, LLC, for
purposes of holding the Company's interest in LVH Holdings LLC.
Gaucho reported a net loss of $21.83 million for the year ended
Dec. 31, 2022, compared to a net loss of $2.39 million for the year
ended Dec. 31, 2021. As of Sept. 30, 2023, the Company had $18.91
million in total assets, $11.02 million in total liabilities, and
$7.89 million in total stockholders' equity.
New York, NY-based Marcum LLP, the Company's auditor since 2013,
issued a "going concern" qualification in its report dated April
17, 2023, citing that the Company has a significant working capital
deficiency, has incurred significant losses and needs to raise
additional funds to meet its obligations and sustain its
operations. These conditions raise substantial doubt about the
Company's ability to continue as a going concern.
The Company's operating needs include the planned costs to operate
its business, including amounts required to fund working capital
and capital expenditures. Based upon projected revenues and
expenses, the Company believes that it may not have sufficient
funds to operate for the next twelve months from the date these
financial statements are made available. Since inception, the
Company's operations have primarily been funded through proceeds
received from equity and debt financings. The Company believes it
has access to capital resources and continues to evaluate
additional financing opportunities. There is no assurance that the
Company will be able to obtain funds on commercially acceptable
terms, if at all. There is also no assurance that the amount of
funds the Company might raise will enable the Company to complete
its development initiatives or attain profitable operations. The
aforementioned factors raise substantial doubt about the Company's
ability to continue as a going concern for a period of one year
from the issuance of these financial statements, according to the
Company's Quarterly Report for the period ended Sept. 30, 2023.
=============
B A H A M A S
=============
FTX GROUP: Estate Sold 2/3 of Grayscale Bitcoin Trust Shares
------------------------------------------------------------
Olga Kharif of Bloomberg News reports that the estate of bankrupt
crypto exchange FTX has sold the majority of its shares in the
Grayscale Bitcoin Trust exchange-traded fund in its first three
days of trading, according to two people familiar with the matter.
The brokerage Marex Capital Markets has sold more than two-thirds
of the 22.28 million shares FTX held, according to one of the
people, who asked not to be named because the matter hasn't been
made public. GBTC shares have traded at an average price of around
$38.19 since its debut as an ETF, so the sale likely fetched more
than $600 million.
About FTX Group
FTX is the world's second-largest cryptocurrency firm. FTX is a
cryptocurrency exchange built by traders, for traders. FTX offers
innovative products including industry-first derivatives, options,
volatility products and leveraged tokens.
Then CEO and co-founder Sam Bankman-Fried said Nov. 10, 2022, that
FTX paused customer withdrawals after it was hit with roughly $5
billion worth of withdrawal requests.
Faced with liquidity issues, FTX on Nov. 9 struck a deal to sell
itself to its giant rival Binance, but Binance walked away from the
deal amid reports on FTX regarding mishandled customer funds and
alleged US agency investigations.
At 4:30 a.m. on Nov. 11, Bankman-Fried ultimately agreed to step
aside, and restructuring vet John J. Ray III was quickly named new
CEO.
FTX Trading Ltd (d/b/a FTX.com), West Realm Shires Services Inc.
(d/b/a FTX US), Alameda Research Ltd. and certain affiliated
companies then commenced Chapter 11 proceedings (Bankr. D. Del.
Lead Case No. 22-11068) on an emergency basis on Nov. 11, 2022.
Additional entities sought Chapter 11 protection on Nov. 14, 2022.
FTX Trading and its affiliates each listed $10 billion to $50
billion in assets and liabilities, making FTX the biggest
bankruptcy filer in the US this year.
According to Reuters, SBF shared a document with investors on Nov.
10, 2022, showing FTX had $13.86 billion in liabilities and $14.6
billion in assets. However, only $900 million of those assets were
liquid, leading to the cash crunch that ended with the company
filing for bankruptcy.
The Hon. John T. Dorsey is the case judge.
The Debtors tapped Sullivan & Cromwell, LLP as bankruptcy counsel;
Landis Rath & Cobb, LLP as local counsel; and Alvarez & Marsal
North America, LLC as financial advisor. Kroll is the claims
agent, maintaining the page
https://cases.ra.kroll.com/FTX/Home-Index
The Official Committee of Unsecured Creditors tapped Paul Hastings
as counsel, FTI Consulting, Inc., as financial advisor, and
Jefferies LLC as the investment banker. Young Conaway Stargatt &
Taylor LLP is the Committee's Delaware and conflicts counsel.
Montgomery McCracken Walker & Rhoads LLP, led by partners Gregory
T. Donilon, Edward L. Schnitzer, and David M. Banker, is
representing Sam Bankman-Fried in the Chapter 11 cases.
White-collar crime specialist Mark S. Cohen has reportedly been
hired to represent SBF in litigation. Lawyers at Paul Weiss
previously represented SBF but later renounced representing the
entrepreneur due to a conflict of interest.
FTX GROUP: Unloads CryptoAssets to Funds to Pay Back Customers
--------------------------------------------------------------
Jonathan Randles of Bloomberg Law reports that FTX is unloading
cryptoassets and hoarding cash as bankruptcy advisers look for a
way to repay customers whose accounts have been frozen since the
platform collapsed in 2022.
The fraud-tainted crypto firm's four largest affiliates --
including FTX Trading Ltd. and Alameda Research LLC -- together
nearly doubled the group's cash pile to $4.4 billion at the end of
2023 from about $2.3 billion in late October 2023, according to
Chapter 11 monthly operating reports. The company's total cash is
likely higher including the rest of its affiliates.
About FTX Group
FTX is the world's second-largest cryptocurrency firm. FTX is a
cryptocurrency exchange built by traders, for traders. FTX offers
innovative products including industry-first derivatives, options,
volatility products and leveraged tokens.
Then CEO and co-founder Sam Bankman-Fried said Nov. 10, 2022, that
FTX paused customer withdrawals after it was hit with roughly $5
billion worth of withdrawal requests.
Faced with liquidity issues, FTX on Nov. 9 struck a deal to sell
itself to its giant rival Binance, but Binance walked away from the
deal amid reports on FTX regarding mishandled customer funds and
alleged US agency investigations.
At 4:30 a.m. on Nov. 11, Bankman-Fried ultimately agreed to step
aside, and restructuring vet John J. Ray III was quickly named new
CEO.
FTX Trading Ltd (d/b/a FTX.com), West Realm Shires Services Inc.
(d/b/a FTX US), Alameda Research Ltd. and certain affiliated
companies then commenced Chapter 11 proceedings (Bankr. D. Del.
Lead Case No. 22-11068) on an emergency basis on Nov. 11, 2022.
Additional entities sought Chapter 11 protection on Nov. 14, 2022.
FTX Trading and its affiliates each listed $10 billion to $50
billion in assets and liabilities, making FTX the biggest
bankruptcy filer in the US this year.
According to Reuters, SBF shared a document with investors on Nov.
10, 2022, showing FTX had $13.86 billion in liabilities and $14.6
billion in assets. However, only $900 million of those assets were
liquid, leading to the cash crunch that ended with the company
filing for bankruptcy.
The Hon. John T. Dorsey is the case judge.
The Debtors tapped Sullivan & Cromwell, LLP as bankruptcy counsel;
Landis Rath & Cobb, LLP as local counsel; and Alvarez & Marsal
North America, LLC as financial advisor. Kroll is the claims
agent, maintaining the page
https://cases.ra.kroll.com/FTX/Home-Index
The Official Committee of Unsecured Creditors tapped Paul Hastings
as counsel, FTI Consulting, Inc., as financial advisor, and
Jefferies LLC as the investment banker. Young Conaway Stargatt &
Taylor LLP is the Committee's Delaware and conflicts counsel.
Montgomery McCracken Walker & Rhoads LLP, led by partners Gregory
T. Donilon, Edward L. Schnitzer, and David M. Banker, is
representing Sam Bankman-Fried in the Chapter 11 cases.
White-collar crime specialist Mark S. Cohen has reportedly been
hired to represent SBF in litigation. Lawyers at Paul Weiss
previously represented SBF but later renounced representing the
entrepreneur due to a conflict of interest.
===========
B R A Z I L
===========
BRAZIL: Narrows Current Account Deficit to 1.32% of GDP
-------------------------------------------------------
Richard Mann at Rio Times Online reports that Brazil's current
account deficit decreased to $28.6 billion (1.32% of GDP) in 2023
from the prior year's $48.3 billion (2.47% of GDP), as reported by
the Central Bank.
The current account shortfall in December was reported at $5.8
billion, an improvement over the $7.5 billion recorded in the same
month a year earlier, according to Rio Times Online.
This deficit, encompassing trade balances, services, income, and
remittances from Brazilians abroad, signifies a positive shift
towards enhancing Brazil's currency and economic resilience, the
report notes.
About Brazil
Brazil is the fifth largest country in the world and third largest
in the Americas. Luiz Inacio Lula da Silva won the 2022 Brazilian
general election. He was sworn in on January 1, 2023, as the 39th
president of Brazil, succeeding Jair Bolsonaro.
S&P Global Ratings raised on Dec. 19, 2023, its long-term global
scale ratings on Brazil to 'BB' from 'BB-'. The outlook on the
long-term ratings is stable. S&P affirmed Brazil's global scale
short-term ratings at 'B' and its national scale long-term rating
at 'brAAA'. S&P also raised the transfer and convertibility
assessment on the country to 'BBB-' from 'BB+'. S&P said, "The
stable outlook reflects our expectation that Brazil will maintain a
strong external position, thanks to strong commodity output and
limited external financing needs. We also believe Brazil's
institutional framework can sustain stable and pragmatic
policymaking based on extensive checks and balances across the
executive, legislative, and judicial branches of government. We
expect a very gradual fiscal correction but anticipate fiscal
deficits will remain large."
Fitch Ratings affirmed on Dec. 15, 2023, Brazil's Long-Term
Foreign-Currency Issuer Default Rating (IDR) at 'BB' with a Stable
Outlook. Fitch said Brazil's ratings are supported by its large and
diverse economy, high per-capita income, and deep domestic markets
and a large cash cushion that support the sovereign's financing
flexibility and its high local-currency debt share. Strong external
finances support resilience to shocks, underpinned by a flexible
exchange rate, robust international reserves and a sovereign net
external creditor position. The ratings are constrained by weak
economic growth potential, relatively low governance scores, high
and rising government debt/GDP, and budgetary rigidities. A new
fiscal framework introduced this year aims to anchor a gradual
consolidation process and address these fiscal weaknesses, but its
effectiveness is increasingly unclear.
Moody's credit rating for Brazil was last set at Ba2 in 2018 with
stable outlook. Moody's affirmed the Ba2 issuer ratings and
senior unsecured bond ratings in April 2022.
DBRS Inc., on August 15, 2023, upgraded Brazil's Long-Term
Foreign and Local Currency - Issuer Ratings to BB from BB (low).
At the same time, DBRS Morningstar confirmed Brazil's
Short-term Foreign and Local Currency - Issuer Ratings at R-4.
The trend on all ratings is Stable (March 2018).
BRAZIL: Sharp Rise in Local Business Bankruptcy Requests
--------------------------------------------------------
Richard Mann at Rio Times Online reports that in 2023, 1,405
companies in Brazil sought judicial recovery, a 68.7% increase from
the previous year.
Small businesses made up 939 of these applications, according to
Rio Times Online. Additionally, bankruptcy filings rose by 13.5%,
the report notes.
Companies seeking help jumped significantly to 1,405 from 833 in
2022. Serasa Experian reported this data, the report relays.
Small and micro businesses led with 939 requests, the report
discloses. Medium and large firms followed with 331 and 135
applications, respectively, the report says.
The service sector saw the most requests at 651, the report notes.
Commerce, manufacturing, and primary sectors also faced challenges,
the report adds.
About Brazil
Brazil is the fifth largest country in the world and third largest
in the Americas. Luiz Inacio Lula da Silva won the 2022 Brazilian
general election. He was sworn in on January 1, 2023, as the 39th
president of Brazil, succeeding Jair Bolsonaro.
Fitch Ratings upgraded on July 26, 2023, Brazil's Long-Term
Foreign-Currency Issuer Default Rating (IDR) to 'BB', from 'BB-',
with a Stable Outlook. The upgrade reflects better-than-expected
macroeconomic and fiscal performance amid successive shocks in
recent years, proactive policies and reforms that have supported
this, and Fitch's expectation that the new government will work
toward further improvements.
In mid-June 2023, S&P Global Ratings, revised the outlook on its
long-term global scale ratings on Brazil to positive from stable.
S&P affirmed its 'BB-/B' long- and short-term foreign and local
currency sovereign credit ratings on Brazil. S&P also affirmed its
'brAAA' national scale rating, and the outlook remains stable. The
transfer and convertibility assessment remains 'BB+'. The positive
outlook reflects signs of greater certainty about stable fiscal and
monetary policy that could benefit Brazil's still-low GDP growth
prospects. Continued GDP growth plus the emerging framework for
fiscal policy could result in a smaller government debt burden than
expected, which could support monetary flexibility and sustain the
country's net external position.
Moody's credit rating for Brazil was last set at Ba2 in 2018 with
stable outlook. Moody's affirmed the Ba2 issuer ratings and
senior unsecured bond ratings in April 2022.
DBRS Inc., on August 15, 2023, upgraded Brazil's Long-Term
Foreign and Local Currency - Issuer Ratings to BB from BB (low).
At the same time, DBRS Morningstar confirmed Brazil's
Short-term Foreign and Local Currency - Issuer Ratings at R-4.
The trend on all ratings is Stable (March 2018).
GOL LINHAS: Fitch Lowers LongTerm IDR to 'D' on Bankruptcy Filing
-----------------------------------------------------------------
Fitch Ratings has downgraded GOL Linhas Aereas Inteligentes S.A.'s
(GOL) and its subsidiary GOL Linhas Aereas S.A.'s Long-Term Foreign
and Local Currency Issuer Default Ratings (IDRs) to 'D' from
'CCC-', and its Long-Term National Scale Rating to 'D(bra)' from
'CCC-(bra)' following the company's Chapter 11 bankruptcy
protection filing on Jan. 25, 2024. Fitch has also downgraded GOL
Finance Inc.'s unsecured bonds to 'C'/'RR5' from 'CC'/'RR5'.
The company has also indicated it has entered the U.S. legal
process with a financing commitment for USD950 million in new
debtor-in-possession (DIP) financing from members of the Ad Hoc
Group of Abra bondholders, as well as certain other Abra
bondholders. The company will seek access to this funding as part
of its First Day hearing in the coming days. The financing is
subject to court approval.
KEY RATING DRIVERS
Chapter 11 Process: On Jan. 25 2024, GOL announced that have
voluntarily filed for Chapter 11 in the U.S. Bankruptcy Court,
seeking to restructure their finances while continuing to fully
operate. This follows GOL's ongoing difficult renegotiation with
lessors over the past months and sequential delays in new aircraft
delivery from its manufacturer. Despite operating cash flow
improvement since pandemic, the higher lease payments following
their reduction/postponements during the COVID-19 pandemic crisis,
in addition to elevated interest rates have been pressuring GOL's
FCF generation, thus resulting in an unsustainable debt profile.
At Sept. 30 2023, GOL's total debt was BRL20.3 billion, per
Fitch´s criteria. Excluding leasing obligations (BRL9.8 billion),
the majority of the debt refers to cross-border bonds (BRL9.3
billion). Readily available cash, per Fitch's criteria, was BRL905
million. At the same period, GOL had around USD200 million (out of
USD450 million) of available credit line with its shareholder Abra
Group Limited (Abra). This transaction with Abra was a result of
another debt restructuring transaction that GOL announced during
March 2023, that also included a credit line of around USD450
million.
DERIVATION SUMMARY
GOL's downgrade to 'D' follows its Jan. 25, 2024 Chapter 11
bankruptcy filing. The bankruptcy filing follows operating
pressures since the COVID-19 pandemic.
RECOVERY ANALYSIS
Key Recovery Rating Assumptions
The recovery analysis assumes that GOL would be considered a going
concern in bankruptcy and that the company would be reorganized
rather than liquidated. Fitch has assumed a 10% administrative
claim.
Going-Concern Approach: GOL's going concern EBITDA is BRL1.9
billion which incorporates the low-end expectations of GOL's EBITDA
post-pandemic, adjusted by lease expenses. The going-concern EBITDA
estimate reflects Fitch's view of a sustainable,
post-reorganization EBITDA level, upon which Fitch bases the
valuation of the company. The enterprise value (EV)/EBITDA multiple
applied is 5.5x, reflecting GOL's strong market position in the
Brazil.
Fitch applies a waterfall analysis to the post-default EV based on
the relative claims of the debt in the capital structure. The debt
waterfall assumptions consider the company's proforma total debt
including the recently announced DIP Financing. These assumptions
result in a recovery rate for the for the unsecured notes within
the 'RR5' range.
RATING SENSITIVITIES
Rating sensitivities are not applicable given the company's Chapter
11 bankruptcy filing.
ISSUER PROFILE
GOL is a leading Brazilian airline, with around 34% market share in
the domestic market, per revenue per RPK in 2022. As of Sept. 30
2023, GOL's fleet included 141 Boeing 737 aircraft, with 97 NGs, 39
MAXs and five Cargo NGs
ESG CONSIDERATIONS
Gol Linhas Aereas Inteligentes S.A has an ESG Relevance Score of
'4' for Management Strategy due to announcement of a corruption
case and charges implemented by the SEC and Department of Justice
(DOJ) during 2022. This has a negative impact on the ratings in
conjunction with other factors.
GOL has an ESG Relevance Score of '4' for Group Structure due to
the its relatively new and larger airline operational group (ABRA),
which has a negative impact on the credit profile, and is relevant
to the rating in conjunction with other factors.
GOL has an ESG Relevance Score of '4' for Governance Structure due
to the relatively new operational group (ABRA) that has lately
demonstrated aggressive financial policies, which has a negative
impact on the credit profile, and is relevant to the rating in
conjunction with other factors.
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' 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. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Entity/Debt Rating Recovery Prior
----------- ------ -------- -----
GOL Linhas Aereas
Inteligentes S.A LT IDR D Downgrade CCC-
LC LT IDR D Downgrade CCC-
Natl LT D(bra)Downgrade CCC-(bra)
Gol Finance Inc.
senior
unsecured LT C Downgrade RR5 CC
GOL Linhas
Aereas S.A. LT IDR D Downgrade CCC-
LC LT IDR D Downgrade CCC-
Natl LT D(bra)Downgrade CCC-(bra)
[*] BRAZIL: Services Sector Sees Steady Growth in 2023
------------------------------------------------------
Rio Times Online reports that in 2023, Brazil's services sector
grew by 2.3% from the previous year, celebrating its third straight
year of growth.
Not since 2012 to 2014 had the country witnessed such a streak. The
stats agency IBGE announced these results on February 9, 2024,
offering a detailed analysis, according to Rio Times Online.
Significantly impacted by the COVID-19 pandemic, the services
sector had to navigate challenges from reduced foot traffic
nationally and globally, the report notes.
Yet, it has shown resilience, gradually rebounding, the report
adds.
About Brazil
Brazil is the fifth largest country in the world and third largest
in the Americas. Luiz Inacio Lula da Silva won the 2022 Brazilian
general election. He was sworn in on January 1, 2023, as the 39th
president of Brazil, succeeding Jair Bolsonaro.
S&P Global Ratings raised on Dec. 19, 2023, its long-term global
scale ratings on Brazil to 'BB' from 'BB-'. The outlook on the
long-term ratings is stable. S&P affirmed Brazil's global scale
short-term ratings at 'B' and its national scale long-term rating
at 'brAAA'. S&P also raised the transfer and convertibility
assessment on the country to 'BBB-' from 'BB+'. S&P said, "The
stable outlook reflects our expectation that Brazil will maintain a
strong external position, thanks to strong commodity output and
limited external financing needs. We also believe Brazil's
institutional framework can sustain stable and pragmatic
policymaking based on extensive checks and balances across the
executive, legislative, and judicial branches of government. We
expect a very gradual fiscal correction but anticipate fiscal
deficits will remain large."
Fitch Ratings affirmed on Dec. 15, 2023, Brazil's Long-Term
Foreign-Currency Issuer Default Rating (IDR) at 'BB' with a Stable
Outlook. Fitch said Brazil's ratings are supported by its large and
diverse economy, high per-capita income, and deep domestic markets
and a large cash cushion that support the sovereign's financing
flexibility and its high local-currency debt share. Strong external
finances support resilience to shocks, underpinned by a flexible
exchange rate, robust international reserves and a sovereign net
external creditor position. The ratings are constrained by weak
economic growth potential, relatively low governance scores, high
and rising government debt/GDP, and budgetary rigidities. A new
fiscal framework introduced this year aims to anchor a gradual
consolidation process and address these fiscal weaknesses, but its
effectiveness is increasingly unclear.
Moody's credit rating for Brazil was last set at Ba2 in 2018 with
stable outlook. Moody's affirmed the Ba2 issuer ratings and
senior unsecured bond ratings in April 2022.
DBRS Inc., on August 15, 2023, upgraded Brazil's Long-Term
Foreign and Local Currency - Issuer Ratings to BB from BB (low).
At the same time, DBRS Morningstar confirmed Brazil's
Short-term Foreign and Local Currency - Issuer Ratings at R-4.
The trend on all ratings is Stable (March 2018).
===========================
C A Y M A N I S L A N D S
===========================
WM CAYMAN II: Fitch Assigns 'BB-' First-Time IDR, Outlook Stable
----------------------------------------------------------------
Fitch Ratings has assigned a first-time 'BB-' Issuer Default Rating
(IDR) to Wynn Resorts, Limited (WRL), Wynn Resorts Finance, LLC
(WRF), Wynn Las Vegas, LLC (WLV), Wynn Macau, Limited (WML), and WM
Cayman Holdings Limited II (WMC), or collectively, "Wynn". Fitch
has also assigned a 'BB+'/'RR1' to all first lien secured debt of
Wynn and a 'BB-'/'RR4' to all unsecured debt of Wynn. The Rating
Outlook is Stable.
The ratings reflect the high-quality portfolio of its gaming
assets, the expected improvement in Macau's gaming market in terms
of visitation and gaming activity that is expected to drive further
improvement in credit metrics, strong results in Las Vegas, and
robust liquidity that should fund near-term capital projects and
could lead to further debt reduction. This is somewhat offset by
the company's average diversification, although it operates in two
of the largest gaming markets in the world, and the capital
required to fund current and potential capital projects, which
could affect the pace of more meaningful credit improvement.
The Stable Outlook reflects Fitch's view that the Macau market will
continue to recover from the removal of travel restrictions due to
the pandemic, healthy Las Vegas market, and strong liquidity.
KEY RATING DRIVERS
Macau Recovery Builds Strength: The strong rebound in Macau gaming
revenues following the removal of the travel restrictions in
early-2023 is expected to be an important driver of Wynn's overall
credit improvement. Fitch estimates that mass market baccarat has
almost fully recovered to 2019 levels, particularly in the premium
mass, which is Wynn's target market. Mass market baccarat was 91%
of full year 2019 levels, although 4Q23 levels exceeded the 4Q19.
Despite the rapid growth in gaming revenues, visitation and airline
capacity remain below 2019 levels, and the rebound in those metrics
should provide another source of further revenue growth over the
near term. Results at Wynn Palace has responded strongly, with mass
market revenues and property EBITDAR margins for 3Q23 already above
2019 levels. Wynn Macau has rebounded a bit slower as the property
continues to focus away from the VIP market while increasingly
catering more to the premium mass market.
Improving Credit Story: As results in Las Vegas and Macau continue
to improve, Fitch expects EBITDAR leverage to improve from slightly
below 7x in 2023 to the low-5x range by 2025 through EBITDA growth
and partial debt reduction. Fitch expects Wynn to be FCF positive
over the forecast horizon. Meanwhile, liquidity is robust, which
includes $2.8 billion in cash, $792 million in short-term
investments, and $737 million of availability on the WRF revolver.
Fitch expects the credit will continue to improve despite the
existence of several material capital projects in Macau, Las Vegas,
Boston and the United Arab Emirates. Other potential projects could
include a casino development in New York if the company is awarded
a license by the state gaming commission.
Management does not have an explicit financial policy on leverage,
although the balance sheet has been managed prudently over the
years, despite taking on development projects that increase
leverage for a short period of time. The company repurchased shares
in 2023, but Fitch expects further repurchases will be
opportunistic and the dividend program will be the cornerstone of
capital return to shareholders.
Robust Las Vegas Results: Wynn's Las Vegas properties have improved
strongly as the impact of the pandemic weakened. The high-quality
nature of the properties combined with its favorable reputation
attracts a more affluent customer, which allows the company to
charge at a higher price point without affecting occupancy. There
is some belief that gaming revenues in Las Vegas could decline over
the next two years as the impact of pent-up demand recedes.
However, this could be offset by stronger room rates from the
return of the group and convention customer and visitation driven
by the attraction of entertainment offerings in Las Vegas (the Wynn
properties have benefited from the opening of The Sphere) and
sporting events.
Development Pipeline: Wynn plans to expand its Boston Harbor
complex through the addition of parking and other amenities. The
project is expected to begin in 2024 and be completed in 2026. In
Macau, the company is committed to $2.2 billion of investment over
10 years, which is split between $1.2 billion in capex and $1
billion for non-gaming focused operations, such as concerts and
events. The commitment could increase by 20% if total Macau gross
gaming revenue exceeds $22.5 billion. Room renovations in Las Vegas
are expected in 2024 and 2025 along with other smaller food and
beverage projects. Finally, the company is moving forward with a
resort development in Ras Al Khaimah in the United Arab Emirates.
Wynn is a 40% owner of the destination resort and the total cost is
expected to be $4 billion.
Strong Parent and Subsidiary Linkage: Fitch views Wynn on a
consolidated basis because the linkage between the parent, Wynn
Resorts Finance, and the operating subsidiaries is strong. The
parent has no unencumbered property cash flows, but benefits from a
meaningful royalty stream from the three distinct subsidiaries.
Wynn Resorts Finance, the primary debt-issuing entity in the U.S.,
is considered a stronger parent relative to the weaker Las Vegas
and Macau subsidiaries, given it benefits from ownership in three
district geographies (including Massachusetts).
As a result, Fitch applied the strong parent/weak subsidiary
approach under its Parent and Subsidiary Linkage Rating Criteria.
The linkage is strong because of perceived high strategic and
operational incentive, as the subsidiaries share brands and
customers across the system. Of note, there are no material
ring-fencing mechanisms to block cash movement from the
subsidiaries. WRF's bonds are cross-defaulted with Wynn Las Vegas'
bonds.
DERIVATION SUMMARY
Wynn historically maintained a 'BB' credit profile except in times
of large development spending or economic crisis, such as COVID or
the global financial crisis. The company has high-quality assets
and operates in attractive regulatory regimes, while typically
maintaining strong liquidity. Fitch expects Wynn to continue to
pursue development projects and expansions/renovations on existing
properties, but will do so in a prudent manner that preserves
liquidity.
Las Vegas Sands (BB+/Positive) has a larger presence in Macau with
five gaming properties and also is one of two operators in
Singapore. EBITDAR leverage at 4.0x is lower than Wynn and
operations have rebounded quickly given that Singapore was not
subject to the same travel restrictions as Macau. The company has a
strong commitment to a conservative financial policy and also
maintains very strong liquidity.
The Seminole Tribe of Florida (BBB/Stable), maintains lower
leverage, enjoys a degree of exclusivity in a deep Florida market,
and stronger credit metrics. Conversely, Seminole has less
discretionary distributions, which partially fund tribal government
operations, and is less diversified.
KEY ASSUMPTIONS
Macau operations are expected to have mid-teens revenue growth as
easy comparisons in early 2024 slowly decline to more normalized
levels. EBITDAR margins are expected to improve by 100-150bp in
2024 and improve slightly over the forecast horizon.
Las Vegas operations are expected to realize low single-digit
growth as lower casino revenues are offset by higher room, food and
beverage, and entertainment revenues. EBITDAR margins are expected
to remain flat over the forecast horizon.
Encore Boston Harbor revenues are expected to be slightly lower in
2024 due to disruption at the property from the Sumner Tunnel
construction project. Revenues are expected to improve post 2025 as
the road construction is completed and later in 2026 from the
expansion of the casino.
Capex and investment activity include the Encore Boston Harbor
expansion, the Macau concession agreements, the UAE resort
development, and expected room renovations in Las Vegas. There is
no assumption for investments in a potential New York casino
license.
Wynn has repurchased stock in 2023, but Fitch believes capital
allocation to shareholders will focus primarily through the
dividend. A nominal amount of share repurchases is estimated over
the forecast horizon as opportunistic purchases.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- EBITDAR leverage declining below 5.0x;
- EBITDAR fixed charge coverage above 3.0x;
- Maintain strong liquidity in order to ensure capital spending and
working capital needs are sufficiently financed.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- EBITDAR leverage exceeding 6.0x on a sustained basis;
- EBITDAR fixed charge coverage sustaining below 2.5x;
- An increase in financial commitments due to new development
projects or increased capital allocations to shareholders that
anticipates the company will breech the EBITDAR leverage or EBITDAR
fixed charge coverage targets described above.
LIQUIDITY AND DEBT STRUCTURE
Strong liquidity: Liquidity includes $2.8 billion in cash, $792
million in short-term investments, and $737 million of availability
on the WRF revolver. Fitch expects the credit will continue to
improve despite the existence several material capital projects in
Macau, Las Vegas, Boston and the United Arab Emirates, which should
be primarily through FCF and cash on hand. Other potential projects
could include a casino development in New York if the company is
awarded a license by the state gaming commission. Management does
not have an explicit financial policy on leverage, although the
balance sheet has been managed prudently over the years, despite
taking on development projects that increase leverage for a short
period of time. During 2023, Wynn addressed current maturities and
a significant portion of 2025 maturities. Fitch believes that
remaining maturities should be manageable over the forecast
horizon.
The company repurchased shares in 2023, but Fitch expects further
repurchases will be opportunistic and the capital allocation to
shareholders will primarily be through the recently enacted
dividend program.
ISSUER PROFILE
Wynn Resorts, Ltd. owns and operates Encore Boston Harbor, Wynn Las
Vegas (including Wynn Encore) and through its 72% owned subsidiary,
Wynn Macau Limited, Wynn Macau and Wynn Palace in Macau, SAR. The
company also operates Wynn Interactive in Nevada, Massachusetts,
New York and Michigan.
ESG CONSIDERATIONS
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' 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. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
DATE OF RELEVANT COMMITTEE
January 26, 2024
Entity/Debt Rating Recovery Prior
----------- ------ -------- -----
WM Cayman Holdings
Limited II LT IDR BB- New Rating
senior unsecured LT BB- New Rating RR4
Wynn Macau, Limited LT IDR BB- New Rating WD
senior unsecured LT BB- New Rating RR4
USD 1 bln 5.5%
bond/note 15-Jan-2026
98313RAG1 LT BB- New Rating RR4
===============
C O L O M B I A
===============
AVIANCA GROUP: S&P Withdraws 'B-' Issuer Credit Rating
------------------------------------------------------
S&P Global Ratings withdrew the 'B-' issuer credit rating on
Avianca Group International, as well as the 'B' issue rating on
Avianca Midco 2's senior secured debt (with expected substantial
recovery prospects of 85%), at the company's request. The outlook
was stable at the time of the withdrawal.
The issuer credit and issue ratings on Avianca's subsidiary
LifeMiles remain unchanged at 'B-'.
EMPRESA DE TELECOMUNICACIONES: Fitch Affirms 'BB+' LongTerm IDRs
----------------------------------------------------------------
Fitch Ratings has affirmed the Long-Term Foreign Currency (FC) and
Long Term Local Currency (LC) Issuer Default Ratings (IDRs) of
Empresa de Telecomunicaciones de Bogota, S.A., E.S.P. (ETB) at
'BB+' and has downgraded the Long-Term National Scale Rating to
'AA(col)' from 'AA+(col)'. The Rating Outlook on the IDRs has been
revised to Negative from Stable. The Outlook on the National Scale
Rating is Stable.
The affirmation of the IDRs reflects ETB's strong infrastructure,
with continued network deployment and competitive advantages in the
fiber-to-the-home (FTTH) segment, which has resulted in roughly 2.2
million homes passed with FTTH. The ratings also consider ETB's
business concentration in the city of Bogota, with a revenue
structure concentrated mainly in its business-to-business (B2B) and
government segment (52% of revenues), and home and
small-and-medium-size-business (SME) segment (44% of revenues).
The downgrade in the National Scale Rating and the Negative Outlook
on the IDRs reflect uncertainty in speed of recovery of its average
revenue per user (ARPU) and user migration from the legacy network,
stressed EBITDA and compressed cash flow margins, which could
result in negative FCF if the company continues with its expansion
capital investments.
KEY RATING DRIVERS
Negative FCF Affecting Leverage: Fitch expects ETB's FCF to remain
negative over the rating horizon, despite lowering capex
investment, due to compressed EBITDA margins caused by intense
competition, higher interest payments, and dividends close to
COP264 billion over the next five years. The company is expected to
maintain its liquidity profile over the investment cycle, given its
strong access local financing and cash balance. Fitch expects ETB's
total gross and net EBITDA leverage to be 2.4x and 1.7x,
respectively, as of YE 2023. Fitch forecasts gross leverage will
decrease to 2x, which is consistent with a higher rating category,
over the rating horizon as the company recovers ARPU, migrates
users from legacy and transitions to a more conservative capex plan
focused on network maintenance.
Intense Competition: Fitch expects the company's competitive
position to remain under pressure as local integrated telecom
operators (Claro, Movistar, Tigo) push their commercial strategies
to retain and grow their subscriber base in Bogota, while ETB
continues to implement its strategy of replacing legacy copper
subscribers with FTTH clients. ETB is the second leading fixed
operator in Bogota based on subscriber market share, after leader
Comunicacion Celular S.A. Comcel S.A. (Claro). ETB´s estimated
market share in the city is of 33% in fixed telephony and 27% in
broadband. Claro is the market leader within Colombia, with
estimated subscriber market shares of 48.7% and 48.4%,
respectively, in the same fixed businesses.
Cash Flow Margin Deterioration: The intense price competition
coupled with inflation costs have eroded margins affecting
operating cash flow generation. Fitch projects that both ARPUs and
subscribers in the fixed business fell close to 13% in 2023, which
has affected revenue growth. The inability to translate increases
in costs to prices have eroded margins to around 23% in 2023 from
31% in 2022.
Flexibility in Capex Investments: Fitch expects that ETB will
reduce capex intensity to 18% over the next four years from a
historical high of 30%, shifting its focus to maintenance capex.
ETB benefits from its strong infrastructure, allowing it to connect
new users with alliances to third parties and renting its network
to other operators.
DERIVATION SUMMARY
ETB is rated one notch lower than Colombia Telecomunicaciones S.A.
E.S.P. (ColTel; BBB-/Negative), a more diversified telecom, with a
growing fixed operation and a strong mobile footprint in Colombia.
ColTel exhibits a more levered capital structure at 3.0x gross
debt/EBITDA than ETB at 2.4x. ETB is rated the same as Telefonica
Celular del Paraguay S.A. (BB+/Stable), the leading mobile operator
in Paraguay (BB+/Stable), which exhibits a strong competitive
position and higher gross leverage of 3.8x. ETB is rated two
notches above WOM S.A. (B-/Watch Negative), a Chilean-based mobile
service provider with low diversification and a weaker financial
profile.
ETB is rated on a standalone basis, as any recurring support from
the District of Bogota, its controlling shareholder, is unlikely.
Fitch views the district's 2017 and 2023 decisions to restructure
ETB's dividend liability extending debt term and including grace
period to capital as extraordinary support of the company's cash
position. No Country Ceiling and/or operating environment
constraint were in effect for these ratings.
KEY ASSUMPTIONS
- Total revenues grow in the low-to-mid-single-digits over the
rating horizon, backed by increased FTTH network penetration;
- Net leverage projected to reach maximum of 1.6x during 2023,
decreasing thereafter;
- Capex intensity of 18% starting 2024 with an average of COP330
billion over the next four years;
- No cash tax payments in rating horizon due to Financial Stability
Agreement effects until 2029;
- Dividends paid throughout the rating horizon in line with cash
flow generation;
- Refinancing all maturing debt throughout the rating horizon.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- A positive rating action would require an upgrade of the rating
of the District of Bogota, plus improvements in the company's
operating performance.
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- Muted revenue growth, due to slower than expected subscriber
growth in non-traditional services, amid continued material revenue
erosion in copper-based services;
- EBITDA margin deterioration without a material improvement in
market position;
- Consistently negative FCF generation with a low cash balance;
- Total debt/EBITDA above 2.0x and/or net debt/EBITDA above 1.5x on
a sustained basis;
- Negative (cash from operations-capex)/debt;
- Dividends payments that negatively affect cash flow generation;
- EBITDA/interest expense below 3.0x on a sustained basis.
LIQUIDITY AND DEBT STRUCTURE
Adequate Liquidity: Liquidity is adequate due to a long-term
capital structure. As of September 2023, the company has cash on
hand of COP119 billion, with short-term debt of COP51 billion. ETB
reported lines of credit of COP270 billion available as of Dec. 30,
2023. Company expects to close 2023 with cash on hand of COP211
billion with short-term debt of COP88 billion.
ISSUER PROFILE
ETB is an integrated Colombian telecommunication company 86.36%
owned by the District of Bogota. The company's main services
offered include fixed voice traditional services (local and long
distance), broadband (BB) and subscription TV services on its
copper and fibre networks.
SUMMARY OF FINANCIAL ADJUSTMENTS
Standard lease adjustments
ESG CONSIDERATIONS
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' 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. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Entity/Debt Rating Prior
----------- ------ -----
Empresa de
Telecomunicaciones
de Bogota, S.A., E.S.P. LT IDR BB+ Affirmed BB+
LC LT IDR BB+ Affirmed BB+
Natl LT AA(col)Downgrade AA+(col)
===============
P A R A G U A Y
===============
AGENCIA FINANCIERA: S&P Affirms 'BB' ICR Amid Upgrade of Sovereign
------------------------------------------------------------------
S&P Global Ratings affirmed its 'BB' issuer credit rating on
Agencia Financiera de Desarrollo (AFD) and its 'B' issuer credit
rating on Vision Banco following the upgrade of Paraguay. Its
rating outlook on AFD remains stable, and its rating outlook on
Vision Banco remains negative.
S&P said, "On Feb. 1, 2024, we raised our long-term sovereign
credit ratings on Paraguay to 'BB+' from 'BB', reflecting our view
that macroeconomic stability and excess supply of renewable energy
are attracting investments, which would sustain growth and gradual
economic diversification.
"We raised our long-term sovereign ratings on Paraguay based on its
track record of evolving but prudent macroeconomic policies,
moderate fiscal deficits and general government debt, and strong
external position. All of these characteristics have bolstered the
Paraguayan economy's resilience against external shocks, and caused
GDP per capita to rise consistently.
"We now see the economic risk for financial institutions operating
in Paraguay as somewhat lower than before because we believe that
the country is more resilient to adverse developments. In addition,
we think the level of credit losses will gradually ease as a
consequence of a more benign environment.
"Nevertheless, our overall assessment of Paraguay's banking risk,
the Banking Industry Country Risk Assessment (BICRA), remains at
group '8', while the anchor for Paraguayan-based banks remains at
'bb-'. (BICRAs are on a scale from '1' to '10', with group '1'
representing the lowest-risk banking systems and group '10' the
highest-risk ones.) Our industry risk assessment on the banking
sector is unchanged at this point, incorporating our view of market
distortions caused by a somewhat high share of narrowly regulated
cooperatives and other participants in the financial system, and by
significant dollarization in banking activities. The trend in both
economic risk and industry risk assessments is still stable."
Agencia Financiera de Desarrollo
S&P said, "The affirmation of our ratings on AFD indicates our view
that its stand-alone credit profile remains 'bb'. Our ratings
continue to reflect AFD's role as the only second-floor state-owned
bank in Paraguay--it's a key loan grantor to other financial
institutions in the country. AFD also has robust capitalization
ratios, which we view as a relative strength, and benefits from the
government's ongoing support, as most of AFD's financial
obligations have the explicit guarantee of the government."
Outlook
The outlook on AFD is stable because S&P expects that the bank will
maintain sound capitalization levels, with a risk-adjusted capital
ratio above 15% in the next 12-18 months, and that the government
of Paraguay will continue supporting AFD to a certain degree.
Downside scenario. Downside is limited at this point. S&P could
lower the ratings only in the case of a deterioration of the
entity's stand-alone credit quality in combination with a downgrade
of the sovereign.
Upside scenario. S&P could upgrade AFD if it was to raise its
sovereign ratings on Paraguay. An upgrade of AFD could also result
from an upward revision of Paraguay's BICRA or if AFD's stand-alone
credit fundamentals improve.
Vision Banco
S&P said, "The affirmation of our ratings on Vision Banco indicates
our view that its stand-alone credit profile remains unchanged at
'b'. Our ratings continue to reflect the bank's relevant presence
in the microfinance segment in Paraguay and its diversified funding
sources, offset by its below-industry-average capitalization rates
and the challenges in restoring profitability after experiencing
increased delinquency rates."
In addition, Vision Banco and Ueno Bank announced their agreement
to merge. Under the proposed structure, Ueno Bank will absorb
Vision Banco's assets and liabilities. The closing of the merger is
subject to approval from the boards of directors of both entities
and the central bank. The announcement doesn't have an immediate
impact on credit fundamentals or the rating on Vision Banco, which
continues to reflect its operations as a sole entity. S&P will
continue monitoring the merger's progress to evaluate the potential
credit impact on Vision Banco.
Outlook
The outlook is negative because of the persistent pressures on
asset quality metrics, with potential implications on the bank's
risk position and losses, and on the ratings.
Downside scenario. In the next 12-18 months, S&P could lower the
ratings if:
-- The bank is unable to improve asset quality, reducing the gap
with the system average and reaching metrics more in line with
historical levels, or
-- Portfolio risk increases, as evidenced by a higher
concentration by single names and economic sectors.
Upside scenario. S&P could revise the outlook to stable if Vision
Banco's asset quality stabilizes, which would depend on its ability
to reduce nonperforming assets (including nonperforming loans and
repossessed assets) to historical levels. S&P would also consider
any potential credit impact of the merger with Ueno Bank.
Ratings Score Snapshot
Agencia Financiera de Desarrollo
ISSUER CREDIT RATING BB/STABLE/--
SACP bb
Anchor bb-
Business position Moderate (-1)
Capital and earnings Very Strong (2)
Risk position Adequate (0)
Funding and liquidity Adequate and adequate (0)
Comparable ratings analysis 0
Support 0
ALAC support 0
GRE support 0
Group support 0
Sovereign support 0
Additional factors 0
SACP--Stand-alone credit profile.
Vision Banco
ISSUER CREDIT RATING B/NEGATIVE/--
SACP b
Anchor bb-
Business position Adequate (0)
Capital and earnings Constrained (-1)
Risk position Moderate (-1)
Funding and liquidity Strong and adequate (0)
Comparable ratings analysis 0
Support 0
ALAC support 0
GRE support 0
Group support 0
Sovereign support 0
Additional factors 0
SACP--Stand-alone credit profile.
Ratings List
RATINGS AFFIRMED
AGENCIA FINANCIERA DE DESARROLLO
Issuer Credit Rating BB/Stable/--
RATINGS AFFIRMED
VISION BANCO S.A.E.C.A.
Issuer Credit Rating B/Negative/--
=====================================
T R I N I D A D A N D T O B A G O
=====================================
CONSOLIDATED ENERGY: Fitch Assigns 'BB-' Rating on Sr. Unsec. Notes
-------------------------------------------------------------------
Fitch Ratings has assigned a 'BB-'/'RR4' rating to Consolidated
Energy Limited's (CEL) proposed senior unsecured notes. The debt
issuance will be used in conjunction with its recently announced
$745 million term loan to fund the acquisition of an additional
stake in Oman Methanol Company LLC (OMC), refinance existing
secured debt, and fund deferred M&A consideration from Proman's
2020 acquisition of CEL.
KEY RATING DRIVERS
Evolving Capital Structure: On Dec. 29, 2023, CEL acquired an
additional stake in the OMC, increasing its total stake from 26.1%
to 60.0% ownership for $347 million, allowing for full
consolidation of OMC's financial results, resulting in annual
EBITDA contribution of over $100 million. CEL is issuing $745
million in new term loan debt and $580 million in unsecured notes
in order to fund the $347 million acquisition, refinance $658
million in existing secured debt, and fund $166 million deferred
M&A consideration from Proman's 2020 acquisition of CEL.
Fitch anticipates that CEL will not materially alter OMC's asset
profile or operating strategy. Fitch also expects that management
will pursue a mix of growth spending and modest debt reduction with
its consistently strong cash generation - with a stronger
medium-term outlook resulting in a heavier orientation towards
growth spending.
Commodity Price Exposure: CEL and other methanol producers have
benefited from historically high methanol contract prices in recent
years, with average U.S. contract prices above $600/MT in 2022 and
above $500/MT in 2023. Though Fitch believes that the near-term
pricing environment will soften as global fuel supply comes back
online, a generally favorable demand environment for olefins and
polyolefins coupled with ongoing strength in fuel demand should
continue to drive a strong methanol pricing environment. This
dynamic, coupled with historically high fertilizer pricing, led to
robust FCF generation in 2021 and 2022.
Fertilizer pricing declined steeply in 2023, alongside extended
downtime on a major turnaround at CEL's Natgasoline assets and an
outage at the company's ammonia, urea, and melamine (AUM) complex
in Trinidad. This resulted in materially weaker EBITDA and cash
flow generation. Fitch anticipates both facilities to run at
typical utilization rates in 2024 and beyond. However, these
outages and the generally volatile commodity price environment
highlight the structural risks the company faces as a commodity
producer with two business lines.
Credible Deleveraging Path: CEL has proactively reduced debt by
repaying $160 million in unsecured notes due 2022 and $150 million
in unsecured notes due 2026. Management has articulated a desire to
achieve investment-grade credit metrics, and Fitch believes the
company has sufficient cash generation to pursue further
deleveraging in the medium term.
However, CEL's acquisition of a majority stake in OMC alongside its
option to move forward with its Big Lake Fuels project, which would
add roughly 1.8 million tons in capacity and cost around $1.8
billion, offer viable alternative uses of cash to debt reduction.
Should CEL continue to elect to spend on growth rather than debt
reduction - in particular with respect to the development of its
Big Lake asset - then the ultimate funding mix and cash generation
will be important in determining the rate at which the company is
able to reduce debt.
Low Cost Producer: The pricing dynamics of natural gas continue to
drive CEL's position as a low-cost producer of methanol. Natural
gas is CEL's main feedstock, and a combination of North American
shale production and the Russia-Ukraine war has amplified the
degree to which North American production is cost-advantaged. Fitch
believes that modest capacity additions are unlikely to change this
dynamic and expects CEL to maintain this advantage over the ratings
horizon.
Energy Applications Drive Profitability: Methanol prices are
volatile and correlated to oil prices, while methanol's feedstock
costs are linked to natural gas and coal prices in Asia. As a
result, sharp declines in the oil/gas price ratio can periodically
pressure CEL's credit profile. Methanol demand is increasingly
driven by energy applications, which include MTO plants, gasoline
blendstocks to increase octane (MTBE), a substitute for bunker fuel
and an industrial boiler fuel.
DERIVATION SUMMARY
CEL is smaller than methanol industry peer Methanex Corp.
(BB+/Stable) and fertilizer industry peers ICL Group Ltd.
(BBB-/Stable) and CF Industries Holdings, Inc. (BBB/Stable). Though
all issuers enjoyed strong pricing environments and robust cash
flows in recent years, methanol producers CEL and Methanex have
elected to use this period as an opportunity to pursue a more
conservative capital deployment strategy relative to the years
before the COVID-19 pandemic. In contrast, CF Industries and ICL
Group enjoy more stable balance sheets.
Methanex is moving forward with a reduced dividend and lower levels
of share repurchases while it uses its excess cash to self-fund a
large capacity expansion in Geismar, LA, while CEL has pursued a
mix debt reduction and inorganic growth through the OMC
transaction. Both companies benefit from a North American
orientation, which has proven especially beneficial in the methanol
industry, but CEL's slightly lower scale and reach, coupled with
higher leverage, mean that it faces slightly more credit risk
overall.
KEY ASSUMPTIONS
- Methanol prices moderate in the second half of 2023 and
thereafter from historic highs, with cost-advantaged production
driving earnings rather than price increases;
- Ammonia - FOB Middle East $/tonne per Fitch's nitrogen fertilizer
price assumptions (published Jan. 9, 2024): $430 in 2023; $360 in
2024; $330 in 2024; and $300 in 2025 and thereafter;
- No significant capex in 2024 and beyond (a decision to move
forward with a significant capacity expansion at that time would
likely be coupled with a materially stronger pricing environment
than is consistent with Fitch's forecast);
- Excess cash used primarily for deleveraging;
- Maturing debt not repaid with cash is refinanced.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- Mid-cycle EBITDA leverage durably below 3.5x, potentially driven
by increased global demand for methanol as power and methanol as a
marine fuel;
- Demonstrated commitment to a conservative capital deployment
strategy even during periods of strong earnings and cash flow
metrics;
- Increased product diversification.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Mid-cycle EBITDA leverage durably above 4.5x;
- Elevated capital or equity-friendly spending, representing a
departure from management's commitment to deleveraging;
- Sustained disruption in operations of major facilities.
LIQUIDITY AND DEBT STRUCTURE
Solid Liquidity, Staggered Maturities: Fitch expects CEL to
maintain solid liquidity throughout the ratings horizon, with solid
medium-term cash generation and full availability on its new $175
million revolving credit facility due 2029. Natgasoline faces an
approximately $500 million maturity in 2025. However, solid cash
generation and a history of proactive debt repayment will likely
give the company sufficient financial flexibility to address the
maturity through a combination of refinancing and repayment.
ISSUER PROFILE
CEL is the world's second largest producer of methanol and one of
the largest nitrogen producers. The company operates methanol
production facilities in Trinidad and Tobago, the U.S., and Oman,
with distribution reaching all major markets in the Americas,
Europe, and Asia.
DATE OF RELEVANT COMMITTEE
January 25, 2024
ESG CONSIDERATIONS
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' 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. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Entity/Debt Rating Recovery
----------- ------ --------
Consolidated
Energy Limited
senior
unsecured LT BB- New Rating RR4
CONSOLIDATED ENERGY: Fitch Assigns BB- LongTerm IDR, Outlook Stable
-------------------------------------------------------------------
Fitch Ratings has assigned a 'BB-' first-time Long-Term Issuer
Default Rating (IDR) to Consolidated Energy Ltd (CEL). Fitch has
also assigned a 'BB+'/'RR2' to the company's secured debt, and a
'BB-'/'RR4' to its unsecured debt. The Rating Outlook is Stable.
The 'BB-' IDR reflects CEL's position as a leading global supplier
of methanol, with over 7 million metric tons (MT) in production
capacity. The rating also reflects the company's advantaged North
American positioning, realistic deleveraging strategy, and the
expectation for strong cash generation in a strong pricing
environment. Offsetting considerations include methanol's
sensitivity to crude and natural gas prices and China's demand, a
high debt burden, and the potential for high capital outlays.
KEY RATING DRIVERS
Evolving Capital Structure: On Dec. 29, 2023, CEL acquired an
additional stake in the Oman Methanol Company LLC (OMC), increasing
its total stake from 26.1% to 60.0% ownership for $347 million,
allowing for full consolidation of OMC's financial results,
resulting in annual EBITDA contribution of over $100 million. CEL
is issuing $745 million in new term loan debt as well as other
unsecured debt in order to fund the $347 million acquisition,
refinance $658 million in existing secured debt, and fund $166
million deferred M&A consideration from Proman's 2020 acquisition
of CEL.
Fitch anticipates that CEL will not materially alter OMC's asset
profile or operating strategy. Fitch also expects that management
will pursue a mix of growth spending and modest debt reduction with
its consistently strong cash generation - with a stronger
medium-term outlook resulting in a heavier orientation towards
growth spending.
Commodity Price Exposure: CEL and other methanol producers have
benefited from historically high methanol contract prices in recent
years, with average U.S. contract prices above $600/MT in 2022 and
above $500/MT in 2023. Though Fitch believes that the near-term
pricing environment will soften as global fuel supply comes back
online, a generally favorable demand environment for olefins and
polyolefins coupled with ongoing strength in fuel demand should
continue to drive a strong methanol pricing environment. This
dynamic, coupled with historically high fertilizer pricing, led to
robust FCF generation in 2021 and 2022.
Fertilizer pricing declined steeply in 2023, alongside extended
downtime on a major turnaround at the company's Natgasoline assets
and an outage in the company's ammonia, urea, and melamine (AUM)
complex in Trinidad. This resulted in materially weaker EBITDA and
cash flow generation. Fitch anticipates both facilities to run at
typical utilization rates in 2024 and beyond. However, these
outages and the generally volatile commodity price environment
highlight the structural risks the company faces as a commodity
producer with two business lines.
Credible Deleveraging Path: CEL has proactively reduced debt by
repaying repaid $160 million in unsecured notes due 2022 and $150
million in unsecured notes due 2026. Management has articulated a
desire to achieve investment-grade credit metrics, and Fitch
believes the company has sufficient cash generation to pursue
further deleveraging in the medium term.
However, CEL's acquisition of a majority stake in OMC alongside its
option to move forward with its Big Lake Fuels project, which would
add roughly 1.8 million tons in capacity and cost around $1.8
billion, offer viable alternative uses of cash to debt reduction.
Should the company continue to elect to spend on growth rather than
debt reduction - in particular with respect to the development of
its Big Lake asset - then the ultimate funding mix and cash
generation will be important in determining the rate at which the
company is able to reduce debt.
Low Cost Producer: The pricing dynamics of natural gas continue to
drive CEL's position as a low-cost producer of methanol. Natural
gas is the company's main feedstock, and a combination of North
American shale production and the Russia-Ukraine war has amplified
the degree to which North American production is cost-advantaged.
Fitch believes that modest capacity additions are unlikely to
change this dynamic and expects CEL to maintain this advantage over
the ratings horizon.
Energy Applications Drive Profitability: Methanol prices are
volatile and correlated to oil prices, while methanol's feedstock
costs are linked to natural gas and coal prices in Asia. As a
result, sharp declines in the oil/gas price ratio can periodically
pressure CEL's credit profile. Methanol demand is increasingly
driven by energy applications, which include MTO plants, gasoline
blendstocks to increase octane (MTBE), a substitute for bunker fuel
and an industrial boiler fuel.
DERIVATION SUMMARY
CEL is smaller than methanol industry peer Methanex Corp.
(BB+/Stable) and fertilizer industry peers ICL Group Ltd.
(BBB-/Stable) and CF Industries Holdings, Inc. (BBB/Stable). Though
all issuers enjoyed strong pricing environments and robust cash
flows in recent years, methanol producers CEL and Methanex have
elected to use this period as an opportunity to pursue a more
conservative capital deployment strategy relative to the years
before the COVID-19 pandemic. In contrast, CF Industries and ICL
Group enjoy more stable balance sheets.
Methanex is moving forward with a reduced dividend and lower levels
of share repurchases while it uses its excess cash to self-fund a
large capacity expansion in Geismar, Louisiana, while CEL has
pursued a mix debt reduction and inorganic growth through the OMC
transaction. Both companies benefit from a North American
orientation, which has proven especially beneficial in the methanol
industry, but CEL's slightly lower scale and reach, coupled with
higher leverage, mean that it faces slightly more credit risk
overall.
KEY ASSUMPTIONS
- Methanol prices moderate in the second half of 2023 and
thereafter from historic highs, with cost-advantaged production
driving earnings rather than price increases;
- Ammonia - FOB Middle East $/tonne per Fitch's nitrogen fertilizer
price assumptions (published Jan. 9, 2024): 430 in 2023; 360 in
2024; 330 in 2024; and 300 in 2025 and thereafter;
- No significant capital expenditures in 2024 and beyond (a
decision to move forward with a significant capacity expansion at
that time would likely be coupled with a materially stronger
pricing environment than is consistent with Fitch's forecast);
- Excess cash used primarily for deleveraging;
- Maturing debt not repaid with cash is refinanced.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- Mid-cycle EBITDA Leverage durably below 3.5x, potentially driven
by increased global demand for methanol as power and methanol as a
marine fuel;
- Demonstrated commitment to a conservative capital deployment
strategy even during periods of strong earnings and cash flow
metrics;
- Increased product diversification.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Mid-cycle EBITDA Leverage durably above 4.5x;
- Elevated capital or equity-friendly spending, representing a
departure from management's commitment to deleveraging;
- Sustained disruption in operations of major facilities.
LIQUIDITY AND DEBT STRUCTURE
Solid Liquidity, Staggered Maturities: Fitch expects the company to
maintain solid liquidity throughout the ratings horizon, with solid
medium-term cash generation and full availability on its new $175
million revolving credit facility due 2029. Natgasoline faces an
approximately $500 million maturity in 2025. However, solid cash
generation and a history of proactive debt repayment will likely
give the company sufficient financial flexibility to address the
maturity through a combination of refinancing and repayment.
ISSUER PROFILE
CEL is the world's second largest producer of methanol and one of
the largest nitrogen producers. The company operates methanol
production facilities in Trinidad and Tobago, the U.S., and Oman,
with distribution reaching all major markets in the Americas,
Europe, and Asia.
ESG CONSIDERATIONS
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' 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. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
DATE OF RELEVANT COMMITTEE
January 25, 2024
Entity/Debt Rating Recovery
----------- ------ --------
Consolidated Energy
Limited LT IDR BB- New Rating
Consolidated Energy
Finance S.A.
senior unsecured LT BB- New Rating RR4
senior secured LT BB+ New Rating RR2
CONSOLIDATED ENERGY: Moody's Alters Outlook on 'B1' CFR to Negative
-------------------------------------------------------------------
Moody's Investors Service affirmed Consolidated Energy Limited's
(CEL) B1 long term corporate family rating and B1-PD probability of
default rating. Moody's has also affirmed the Ba3 ratings of all
existing guaranteed and backed senior secured term loans B and
backed senior secured revolving credit facility (RCF) and the B2
ratings of all existing backed senior unsecured notes, both classes
of debt are issued by Consolidated Energy Finance, S.A. (CEF).
Moody's also assigned a Ba3 rating to the proposed $745 million
backed senior secured term loan and the proposed $175 million
backed senior secured revolving credit facility (RCF). Concurrently
Moody's assigned a B2 rating to the proposed $580 million backed
senior unsecured notes. The proposed instruments will also be
issued by CEF. The outlook on both entities has been changed to
negative from stable.
TRANSACTION DESCRIPTION
The proceeds of the transaction will be used to refinance CEF's
guaranteed senior secured term loan B and backed senior secured
term loan B due 2025, repay amounts drawn under its existing backed
senior secured revolving credit facility (total refinancing amount
of $658 million). The remaining proceeds will be used to repay a
$600 million bridge facility, which was used to finance the $347
million purchase of a 56.53% stake in Methanol Holdings
International Limited (MHIL), making it a wholly owned subsidiary
of CEL and increasing the indirect shareholding in operating asset
Oman Methanol Company LLC (OMC) to 60% from 26%. The bridge
facility was also used to finance a $253 million loan to parent
company Proman AG (Proman), parts of which will be used to finance
a deferred purchase price consideration of $166 million, which
originated in 2020 in connection with the buy out of CEL's previous
minority shareholder. Around $125 million of transaction proceeds
will increase CEL's cash balance.
RATINGS RATIONALE
The change of outlook on CEL reflects the fact that the proposed
transaction increases Moody's estimated mid-cycle leverage from
around 5x to 5.5x, which is above the expectations for CEL's B1
CFR. The mid-cycle leverage forecast is based on Moody's assumption
that operating rates at CEL's Trinidad and Tobago methanol plants,
AUM complex and Natgasoline LLC (Natgasoline, B1 stable) will be
above 80%. Hence, operational underperformance poses a risk to this
forecast. Moody's estimates CEL's 2023 leverage to be at around
10.5x pro forma for the proposed debt issuance. The high point in
time leverage is a reflection of lower methanol prices and
significantly lower UAN & Ammonia prices and lower production
volumes due to unexpected production outages during 2023.
Furthermore Moody's views the loan to CEL's shareholder Proman as a
credit negative governance consideration, as it highlights the
risks of cash being allocated for financing needs outside of the
restricted group. Total borrowings to the parent company according
to the company now amount to around $300 million. Moody's
understands that the terms of the loans provided to Proman are at
arm's length.
The transaction also increases the proportion of unsecured debt in
the capital structure and commitments under the RCF are expected to
be reduced by $50 million. Although the transaction includes
additional cash raised, Moody's views the lower availability under
the revolving credit facility as incrementally negative for CEL's
liquidity profile, given the pronounced volatility of cash
generation and complex group structure with cash and financing
needs at various layers of the group.
CEL's rating is supported by Moody's expectation that the company
under mid-cycle conditions can generate significant free cash flows
and apply those to debt reduction in line with its ambition to
maintain net leverage (company definition) at below 3x (6.1x per
09/2023 and pro forma for the OMC acquisition). Furthermore,
Moody's views the 34% stake increase in OMC as moderately accretive
to CEL's business profile. OMC benefits from the availability of
natural gas at a fixed price and has in the past operated
relatively reliably and been a major dividend contributor to CEL.
CEL's rating reflects its leading market position in methanol,
which is underpinned by its competitive cost position.
CEL's B1 CFR negatively reflects the pronounced cyclicality in the
methanol and Ammonia derivatives markets as well as the risk of
plant outages resulting in significant earnings and cash flow
volatility. The rating is constrained by the company's complex
capital structure with debt at various levels of the group and the
fact that cash generated at its Natgasoline joint venture and OMC
can only be used to reduce leverage at respective subsidiaries or
can be upstreamed via dividends, which will result in an outflow of
minority dividends. The CEL perimeter represents a significant
part of Proman's operations. CEL's operations and the operations of
its shareholder are highly interdependent. Entities controlled or
related to Proman provide distribution, logistics and manufacturing
services to CEL at arms-length terms, resulting in substantial
related-party transactions in addition to the loans provided to
Proman.
LIQUIDITY PROFILE
CEL's liquidity is adequate. Proforma for the OMC and the
refinancing transaction the company had around $292 million cash on
balance sheet (excluding restricted cash). Furthermore, the group
has access to a $45 million cash availability under its undrawn RCF
at Natgasoline maturing in August 2025 and will have access to $175
million under the proposed RCF at the CEF level. In combination
with expected FFO generation of around of around $300 million under
Moody's mid cycle scenario, these sources are sufficient to
accommodate working capital swings and capital spending of around
$120-$150 million. Moody's assessment of CEL's liquidity profile
takes into account the expectation that debt maturities including
Natgasoline's upcoming 2025 maturities will be addressed well in
advance and that the transaction closes as proposed.
STRUCTURAL CONSIDERATIONS
Consolidated Energy Finance, S.A. 's (CEF) outstanding backed
senior unsecured bonds are rated B2, one notch below the B1
corporate family rating (CFR), reflecting the priority ranking of
the guaranteed senior secured term loan B and backed senior secured
term loan B and the $225 million RCF, which are rated Ba3. The
rating of the backed senior unsecured bonds also reflects the
structural subordination of CEF's creditors to those of its
US-based operating subsidiary, Natgasoline LLC, which is not a
guarantor to CEF's bonds and whose financial debt is largely
secured against respective assets. The rating of the guaranteed and
backed senior secured bank credit facilities is Ba3, one notch
above CEL's CFR, because of their priority ranking in the capital
structure.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Moody's could upgrade CEL's rating if its leverage under mid-cycle
conditions would decrease to below 4.5x and the consistently would
generate RCF / debt well above 10%.
An upgrade furthermore would require the company to maintain a
conservatively managed liquidity profile and capital structure
through the cycle also in times of capacity additions. Furthermore
a simplification of the group structure would be positive for the
rating.
Moody's could consider downgrading CEL's rating if the company
fails to reduce Moody's adjusted gross debt towards $3.1 billion as
a result of FCF falling behind expectations reflected by FCF/debt
consistently in the low single digits or negative. Furthermore
increasing financial support for financing needs of its shareholder
would be negative for the rating.
PRINCIPAL METHODOLOGY
The principal methodology used in these ratings was Chemicals
published in October 2023.
COMPANY PROFILE
Consolidated Energy Limited (CEL), along with its subsidiaries, is
a global group whose principal activities are focused on the
production of petrochemical products. Its main products are
methanol, ammonia and UAN, with investments in Trinidad and Tobago,
the US and Oman. The group is one of the world's largest producers
of methanol. In 2023, the group is expected to generate sales of
around $1.3 billion, and company reported EBITDA of around $195
million.
CEL main operations are its methanol and AUM complex in Trinidad &
Tobago, its 50% controlling in Natgasoline LLC its 60% in Oman
Methanol Company LLC and its minority stake in ammonia producers
Caribbean Nitrogen Company Limited and N2000 Limited.
=================
V E N E Z U E L A
=================
MERCANTIL BANCO: Fitch Affirms & Then Withdraws 'CC' LongTerm IDRs
------------------------------------------------------------------
Fitch Ratings has affirmed Mercantil, C.A. Banco Universal's
Long-Term Foreign and Local Currency Issuer Default Ratings (IDRs)
at 'CC' and simultaneously withdrawn the ratings. Fitch has also
affirmed and withdrawn all other ratings including the Viability
rating (VR) at 'cc'. The existing Government Support Rating of 'ns'
has also been affirmed and withdrawn.
Fitch has chosen to withdraw the ratings for commercial reasons.
Fitch will no longer provide ratings or analytical coverage for the
issuer.
KEY RATING DRIVERS
The key rating drivers of the issuer were the same as those
detailed in "Fitch Affirms Mercantil, C.A. Banco Universal's IDR at
'CC'" published on Nov. 9, 2023.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
Negative Rating Sensitivities are not applicable as the ratings
have been withdrawn.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
Positive Rating Sensitivities are not applicable as the ratings
have been withdrawn.
VR ADJUSTMENTS
VR Adjustments
The adjustments to the implied viability rating factor scores that
resulted in the overall Viability Rating of 'cc' were as follows:
Operating Environment: The implied rating of 'b' was adjusted to
'c' due to Macroeconomic Stability (negative) and Regulatory and
Legal Framework (negative);
Business Profile: The implied score of 'b' was adjusted to 'cc' due
to Business Model (negative);
Asset Quality: The implied score of 'bb' was adjusted to 'cc' due
to Non-Loan Exposures (negative) and Underwriting Standards and
Growth (negative);
Earnings and Profitability: The implied score of 'bb' was adjusted
to 'cc' due to Earnings Stability (negative) and Risk-Weight
Calculation (negative);
Capitalization and Leverage: The implied score of 'bb' was adjusted
to 'cc' due to Capital Flexibility and Ordinary Support (negative),
and Leverage and Risk-Weight Calculation (negative);
Funding and Liquidity: The implied score of 'bb' was adjusted to
'cc' due to Deposit Structure (negative).
ESG CONSIDERATIONS
Following the withdrawal of ratings for Mercantil, Fitch will no
longer be providing the associated ESG Relevance Scores. Prior to
today's withdrawal, Mercantil had an ESG Relevance Score of '4' for
Financial Transparency due to the distortion of its financial
indicators from hyperinflation and limited regulatory transparency,
and changes in regulatory framework, which had a negative impact on
the credit profile.
Mercantil also had an ESG Relevance Score of '4' for Governance
Structure, which reflects the extent to which the regulatory
framework negatively affects the OE and the bank's financial
performance. This had a moderately negative impact on the ratings
in conjunction with other factors.
The highest level of ESG credit relevance was a score of '3',
unless otherwise disclosed in this section. A score of '3' 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. Fitch's ESG Relevance Scores are
not inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Entity/Debt Rating Prior
----------- ------ -----
Mercantil, C.A.
Banco Universal LT IDR CC Affirmed CC
LT IDR WD Withdrawn CC
ST IDR C Affirmed C
ST IDR WD Withdrawn C
LC LT IDR CC Affirmed CC
LC LT IDR WD Withdrawn CC
LC ST IDR C Affirmed C
LC ST IDR WD Withdrawn C
Viability cc Affirmed cc
Viability WD Withdrawn cc
Government Support ns Affirmed ns
Government Support WD Withdrawn ns
===============
X X X X X X X X
===============
[*] BOND PRICING COLUMN: For the Week Feb. 5 to Feb. 9, 2024
------------------------------------------------------------
Issuer Cpn Price Maturity
Country Curr
------ --- ----- --------
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2W Ecobank SA 10.49 28.12 11/24/29 BR BRL
ACEN Finance Ltd 4 63.85 KY USD
Aeropuerto Internacional Tocumen 5.12 71.46 08/11/61
PA USD
Aeropuerto Internacional Tocumen 4 72.47 08/11/41
PA USD
Aeropuerto Internacional Tocumen 4 72.52 08/11/41
PA USD
Aeropuerto Internacional Tocumen 5.12 71.70 08/11/61
PA USD
AES Tiete Energia SA 6.78 0.71 04/15/24 BR BRL
Agile Group Holdings Ltd 5.75 16.88 01/02/25
KY USD
Agile Group Holdings Ltd 6.05 13.65 10/13/25
KY USD
Agile Group Holdings Ltd 5.5 15.63 04/21/25 KY USD
Agile Group Holdings Ltd 5.5 13.01 05/17/26 KY USD
Agile Group Holdings Ltd 7.87 3.28 KY USD
Agile Group Holdings Ltd 7.75 3.25 KY USD
Alfa Desarrollo SpA 4.55 73.56 09/27/51 CL USD
Alfa Desarrollo SpA 4.55 73.21 09/27/51 CL USD
Alibaba Group Holding Ltd 2.7 68.26 02/09/41
KY USD
Alibaba Group Holding Ltd 3.15 65.50 02/09/51
KY USD
Alibaba Group Holding Ltd 3.25 62.62 02/09/61
KY USD
AMTD IDEA Group 1.5 7.5 KY USD
AMTD IDEA Group 4.5 56.25 KY SGD
Amwaj Ltd 6.37 69.64 KY USD
Amwaj Ltd 4.5 49.54 KY USD
Argentina Bonar Bonds 1 38.99 07/09/29 AR USD
Argentina Treasury Dual Bond 3.25 45.75 04/30/24
AR USD
Argentine Bonos del Tesoro 15.5 39.88 10/17/26
AR ARS
Argentine International Bond 0.5 35.67 07/09/29
AR EUR
Argentine International Bond 0.12 36.64 07/09/30
AR EUR
Argentine International Bond 1 41.35 07/09/29
AR USD
Ascent Finance Ltd 3.4 65.82 02/06/43 KY AUD
Ascent Finance Ltd 1.19 55.80 07/12/47 KY EUR
Ascent Finance Ltd 3.77 67.09 06/28/47 KY AUD
Astra Cumulative Investments 2019 1.5 62.01 11/01/29
KY USD
At Home Cayman 11.5 69.25 05/12/28 KY USD
At Home Cayman 11.5 69.01 05/12/28 KY USD
AYC Finance Ltd 3.9 62.17
KY USD
Banco Davivienda SA 6.65 68.25 CO USD
Banco Davivienda SA 6.65 70.33 CO USD
Banco de Chile 2.65 74.28 03/09/35 CL AUD
Banco de Credito e Inversiones SA 6 30.53 10/01/27
CL CLP
Banco del Estado de Chile 2.8 66.76 03/13/40
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Banco del Estado de Chile 3.12 70.20 02/21/40
CL AUD
Banco Santander Chile 1.25 72.78 11/29/34 CL EUR
Banco Santander Chile 3.05 70.29 02/28/39 CL AUD
Banda de Couro Energetica S/A 7.96 54.05 01/15/27
BR BRL
Baraunas II Energetica S/A 7.96 12.30 01/15/27
BR BRL
Bishopsgate Asset Finance Ltd 4.80 67.16 08/14/44
KY GBP
Bolivian International Bond 4.5 55.21 03/20/28
BO USD
Bolivian International Bond 7.5 58.58 03/02/30
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Bolivian International Bond 4.5 55.26 03/20/28
BO USD
Bolivian International Bond 7.5 58.85 03/02/30
BO USD
BOPREAL 5 64.63 10/31/27 AR USD
BOPREAL 3 59.98 05/31/26 AR USD
Brazilian International Bond 4.75 73.39 01/14/50
BR USD
BRF SA 5.75 73.03 09/21/50 BR USD
BRF SA 5.75 72.76 09/21/50 BR USD
Caja de Compensacion 2.25 16.64 05/05/24 CL CLP
Camposol SA 6 72.62 02/03/27 PE USD
Camposol SA 6 72.5 02/03/27 PE USD
CFLD Cayman Investment Ltd 2.5 4.09 01/31/31
KY USD
CFLD Cayman Investment Ltd 2.5 2.75 01/31/31
KY USD
CFLD Cayman Investment Ltd 2.5 3.04 01/31/31
KY USD
CFLD Cayman Investment Ltd 2.5 4.39 01/31/31
KY USD
CFLD Cayman Investment Ltd 2.5 3.24 01/31/31
KY USD
CFLD Cayman Investment Ltd 2.5 2 01/31/31 KY USD
CFLD Cayman Investment Ltd 2.5 8.70 01/31/31
KY USD
CFLD Cayman Investment Ltd 2.5 3.24 01/31/31
KY USD
CFLD Cayman Investment Ltd 2.5 2.15 01/31/31
KY USD
Chile International Bond 3.5 71.77 01/25/50
CL USD
Chile International Bond 3.5 71.4 04/15/53 CL USD
Chile International Bond 3.1 61.78 01/22/61
CL USD
Chile International Bond 3.1 73.07 05/07/41
CL USD
Chile International Bond 3.25 62.13 09/21/71
CL USD
Chile International Bond 1.25 53.19 01/22/51
CL EUR
Chile International Bond 1.25 66.71 01/29/40
CL EUR
Chile International Bond 1.3 73.39 07/26/36
CL EUR
China Overseas Finance Ltd 3.12 73.36 03/02/35
KY USD
China Yuhua Education Corp Ltd 0.9 63.53 12/27/24
KY HKD
CK Hutchison Europe Finance 21 1 74.51 11/02/33
KY EUR
CK Hutchison International 19 3.37 73.14 09/06/49
KY USD
CK Hutchison International 19 3.37 73.13 09/06/49
KY USD
CK Hutchison International 20 3.37 72.73 05/08/50
KY USD
CK Hutchison International 20 3.37 72.59 05/08/50
KY USD
Colombia International Bond 4.12 59.87 05/15/51
CO USD
Colombia International Bond 3.87 55.70 02/15/61
CO USD
Colombia International Bond 5.2 70.93 05/15/49
CO USD
Colombia International Bond 4.12 65.09 02/22/42
CO USD
Colombia International Bond 6.25 74.29 07/09/36
CO COP
Colombia International Bond 7.25 73.28 10/26/50
CO COP
Colombia International Bond 7.25 73.28 10/26/50
CO COP
Colombia International Bond 5 70.41 06/15/45
CO USD
Colombia International Bond 6.25 74.29 07/09/36
CO COP
Colombia Telecomunicaciones SA 4.95 65.59 07/17/30
CO USD
Colombia Telecomunicaciones SA 4.95 65.72 07/17/30
CO USD
Colombian TES 6.25 74.16 07/09/36 CO COP
Colombian TES 7.25 72.96 10/26/50 CO COP
Corp Nacional del Cobre de Chile 3.7 67.10 01/30/50
CL USD
Corp Nacional del Cobre de Chile 3.15 60.70 01/15/51
CL USD
Corp Nacional del Cobre de Chile 3.7 67.08 01/30/50
CL USD
Corp Nacional del Cobre de Chile 3.15 60.77 01/15/51
CL USD
Corp Nacional del Cobre de Chile 3.58 73.73 07/22/39
CL AUD
Cristalerias de Chile SA 3.75 37.11 08/20/30
CL CLP
Dibens Leasing S/A 10.76 40.06 03/01/35 BR BRL
Dibens Leasing S/A 10.76 45.34 03/01/35 BR BRL
Dibens Leasing S/A 10.76 38.30 03/01/35 BR BRL
Earls Eight Ltd 0.1 63.85 12/20/31
KY AUD
Earls Eight Ltd 1.7 71.72 06/20/32
KY AUD
Ecopetrol SA 5.87 73.52 05/28/45 CO USD
Ecopetrol SA 5.87 69.85 11/02/51 CO USD
El Salvador International Bond 7.12 70.64 01/20/50
SV USD
El Salvador International Bond 7.62 74.45 09/21/34
SV USD
El Salvador International Bond 7.62 74.48 09/21/34
SV USD
El Salvador International Bond 7.12 70.70 01/20/50
SV USD
El Salvador International Bond 5.87 64.17 01/30/25
SV USD
Elektra Noreste SA 3.87 74.69 07/15/36 PA USD
Elektra Noreste SA 3.87 74.69 07/15/36 PA USD
Embotelladora Andina SA 6.5 23.28 06/01/26
CL CLP
Empresa de los Ferrocarriles 3.83 65.88 09/14/61
CL USD
Empresa de los Ferrocarriles 3.06 60.03 08/18/50
CL USD
Empresa de los Ferrocarriles 3.06 59.98 08/18/50
CL USD
Empresa de los Ferrocarriles 3.83 65.97 09/14/61
CL USD
Empresa de los Ferrocarriles 6.5 11.18 01/01/26
CL CLP
Empresa de Servicios Sanitarios 6 24.52 06/01/28
CL CLP
Empresa de Transmision Electrica 5.12 71.11 05/02/49
PA USD
Empresa de Transmision Electrica 5.12 71.46 05/02/49
PA USD
Empresa de Transporte de Pasajeros 3.63 65.72 09/13/61
CL USD
Metro SA 3.69 65.50 09/13/61 CL USD
Metro SA 5.5 50.28 07/15/27 CL CLP
Salta Edsa SA 5 60.86 05/11/25 AR USD
Empresa Nacional del Petroleo 4.5 73.37 09/14/47
CL USD
Empresa Nacional del Petroleo 4.5 73.30 09/14/47
CL USD
ENA Master Trust 4 70.29 05/19/48 PA USD
ENA Master Trust 4 69.93 05/19/48 PA USD
Enel Generacion Chile SA 6.2 29.34 10/15/28
CL CLP
Equatorial Para Distribuidora 10.83 1.03 05/15/28
BR BRL
Esval SA 3.5 16.79 02/15/26 CL CLP
Farfetch Ltd 3.75 1.5 05/01/27 KY USD
Fospar S/A 6.53 1.36 05/15/26 BR BRL
GDM Argentina SA 2.5 0.01 09/08/24 AR USD
GDS Holdings Ltd 4.5 68.38 01/31/30 KY USD
Generacion Mediterranea SA 12.5 0.01 02/16/24
AR USD
General Shopping Finance Ltd 10 66.2 KY USD
General Shopping Finance Ltd 10 65.00 KY USD
Genneia SA 2 55.81 07/14/28 AR USD
Greenland Hong Kong Holdings Ltd 10.21 14.28
KY USD
Guacolda Energia SA 4.56 69.89 04/30/25 CL USD
Guacolda Energia SA 10 70.04 12/30/30 CL USD
Guacolda Energia SA 4.56 69.95 04/30/25 CL USD
Guacolda Energia SA 10 70.20 12/30/30 CL USD
Hector A Bertone SA 1.94 0.01 04/07/24 AR USD
Hilong Holding Ltd 9.75 62.197 11/18/24 KY USD
Hilong Holding Ltd 9.75 60.246 11/18/24 KY USD
Hilong Holding Ltd 9.75 60.73 11/18/24 KY USD
ICBC DO Brasil Banco Multiplo 3.3 59.55
BR USD
IMPSA 1 74.05 12/30/31 AR USD
Itau Unibanco SA/Nassau 5.84 19.76 05/20/27
BR BRL
Jamaica Government Bond 6.25 67.79 07/11/48
JM JMD
Jamaica Government Bond 8.5 72.98 12/21/61 JM JMD
John Deere Credit Cia Financiera 8 18 06/25/24
AR USD
Lani Finance Ltd 1.7 62.65 03/14/49 KY EUR
Lani Finance Ltd 1.85 65.00 09/20/48 KY EUR
Lani Finance Ltd 1.92 66.04 10/19/48 KY EUR
Lani Finance Ltd 3.14 64.95 10/19/48 KY AUD
Link Finance Cayman 2009 Ltd/The 2.18 70.52 10/27/38
KY HKD
Logan Group Co Ltd 7 5.25 KY USD
Longfor Group Holdings Ltd 3.9 41.25 09/16/29
KY USD
Longfor Group Holdings Ltd 3.37 54.77 04/13/27
KY USD
Longfor Group Holdings Ltd 4.5 50.50 01/16/28
KY USD
Longfor Group Holdings Ltd 3.8 36.66 01/13/32
KY USD
Luminis III Ltd 2.32 41.36 09/22/48
KY USD
Luminis III Ltd 2.42 54.23 09/22/48
KY AUD
Luminis IV Ltd 3.15 69.39 01/22/42 KY AUD
Luminis Ltd 2.31 53.79 09/22/48 KY AUD
Lunar Funding I Ltd 1.66 70.56 08/11/56 KY GBP
MTR Corp CI Ltd 3 74.33 03/11/51 KY HKD
MTR Corp CI Ltd 3 74.27 03/11/51 KY HKD
Nuevosur SA/Chile 4 41.15 03/21/28 CL CLP
Panama International Bond 3.87 53.95 07/23/60
PA USD
Panama International Bond 2.25 68.79 09/29/32
PA USD
Panama International Bond 4.5 61.55 04/01/56
PA USD
Panama International Bond 4.5 60.03 01/19/63
PA USD
Panama International Bond 4.5 63.57 04/16/50
PA USD
Panama International Bond 4.5 65.25 05/15/47
PA USD
Panama International Bond 4.3 61.17 04/29/53
PA USD
Panama International Bond 2.78 56.56 12/01/60
PE USD
Panama International Bond 3.23 56.47 07/28/21
PE USD
Panama International Bond 3.55 70.60 03/10/51
PE USD
Panama International Bond 3.6 64.88 01/15/72
PE USD
Panama International Bond 3.3 73.47 03/11/41
PE USD
Petroleos del Peru SA 5.62 66.25 06/19/47 PE USD
Petroleos del Peru SA 5.62 66.2 06/19/47 PE USD
Powerlong Real Estate Holdings 6.95 9.34 12/06/25
KY USD
Powerlong Real Estate Holdings 7.12 8.8 01/15/26
KY USD
Powerlong Real Estate Holdings 4 8.75 07/12/24
KY USD
Powerlong Real Estate Holdings 6.25 10.25 08/10/24
KY USD
Provincia de Cordoba 7.12 39.73 10/27/26 AR USD
Provincia de la Rioja 4.5 54.71 01/20/27 AR USD
Provincia de la Rioja 7.5 49.86 07/20/32 AR USD
Provincia del Chaco Argentina 4 0.01 12/04/26
AR USD
QNB Finance Ltd 13.5 66.88 10/06/25 KY TRY
QNB Finance Ltd 11.5 73.87 01/30/25 KY TRY
QNB Finance Ltd 3.35 70.74 10/21/39
KY AUD
QNB Finance Ltd 2.93 73.20 09/16/35
KY AUD
QNB Finance Ltd 2.85 71.89 12/04/35
KY AUD
QNB Finance Ltd 2.95 74.37 02/14/35
KY AUD
Radiance Holdings Group Co Ltd 7.8 59.08 03/20/24
KY USD
Rio Alto Energias Renovaveis SA 7 28.41 07/15/27
BR BRL
Santander Consumer Chile SA 2.91 71.95 11/27/34
CL AUD
Seazen Group Ltd 6 53.5 08/12/24 KY USD
Seazen Group Ltd 4.45 28.75 07/13/25 KY USD
Shui On Development Holding Ltd 5.5 70.38 03/03/25
KY USD
Shui On Development Holding Ltd 5.5 57.19 06/29/26
KY USD
Silk Road Investments Ltd 2.85 65.82 01/23/42
KY AUD
Skylark Ltd 1.7 58.70 04/04/39 KY GBP
Autopista Central SA 5.3 37.23 12/15/26 CL CLP
Norte Express SA 5.3 50.38 12/15/28 CL CLP
Minera de Chile SA 3.5 65.77 09/10/51 CL USD
Minera de Chile SA 3.5 65.70 09/10/51 CL USD
Southern Water Services 3 69.41 05/28/37 KY GBP
SPE Saneamento RIO 1 SA 7.2 10.52 01/15/42 BR BRL
SPE Saneamento RIO 1 SA 6.9 10.29 01/15/34 BR BRL
SPE Saneamento Rio 4 SA 7.2 10.21 01/15/42 BR BRL
SPE Saneamento Rio 4 SA 6.9 10.36 01/15/34 BR BRL
Spica Ltd 2.02 74.24 03/24/33 KY AUD
Spirit Loyalty Cayman Ltd 8 71.77 09/20/25 KY USD
Spirit Loyalty Cayman Ltd 8 71.81 09/20/25 KY USD
Spirit Loyalty Cayman Ltd 8 70.94 09/20/25 KY USD
Spirit Loyalty Cayman Ltd 8 71.36 09/20/25 KY USD
Sylph Ltd 2.65 67.08 03/25/36 KY USD
Sylph Ltd 2.36 63.1 09/25/36 KY USD
Sylph Ltd 2.93 73.67 06/24/36 KY AUD
SYN prop e tech SA 11.1 21.07 03/15/24 BR BRL
Telecom Argentina SA 1 73.58 03/09/27 AR USD
Telecom Argentina SA 1 65.68 02/10/28 AR USD
Telefonica Moviles Chile SA 3.53 73.94 11/18/31
CL USD
Telefonica Moviles Chile SA 3.53 73.86 11/18/31
CL USD
Tencent Holdings Ltd 3.24 66.94 06/03/50 KY USD
Tencent Holdings Ltd 3.29 62.53 06/03/60 KY USD
Tencent Holdings Ltd 3.94 72.16 04/22/61 KY USD
Tencent Holdings Ltd 3.24 67.03 06/03/50 KY USD
Tencent Holdings Ltd 3.29 62.71 06/03/60 KY USD
Tencent Holdings Ltd 3.94 72.24 04/22/61 KY USD
Three Gorges Finance 3.2 70.17 10/16/49 KY USD
Travessia Securitizadora 9 1.06 01/20/32
BR BRL
Vert Cia Securitizadora SA 11.2 57.04 02/15/24
BR BRL
Volcan Cia Minera SAA 4.37 53.65 02/11/26 PE USD
Volcan Cia Minera SAA 4.37 53.35 02/11/26 PE USD
VTR Comunicaciones SpA 5.12 59.35 01/15/28 CL USD
VTR Comunicaciones SpA 4.37 58.89 04/15/29 CL USD
VTR Comunicaciones SpA 5.12 59.06 01/15/28 CL USD
VTR Comunicaciones SpA 4.37 58.87 04/15/29 CL USD
YPF SA 7 73.71 12/15/47 AR USD
YPF SA 1 65.01 04/25/27 AR USD
YPF SA 7 73.18 12/15/47 AR USD
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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.
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