Daily Insolvency News Headlines

Wed., May 27, 2015

Wed., May 27, 2015

Ukraine on Tuesday expressed confidence it would complete a debt restructuring to clear the way for fresh IMF aid next month after state-run Ukreximbank tied up a deal with a bondholders' committee to extend maturities on $1.5 billion of Eurobonds, Reuters reported. Near-bankrupt Ukraine is holding talks to restructure sovereign and state-guaranteed debt to plug a $15.3 billion funding gap required under an International Monetary Fund-backed $40 billion bailout programme. Negotiations have soured with a creditors committee representing about $9 billion of debt repeating objections to any writedown on the face value of the bonds and Kiev accusing bondholders of being "unscrupulous" and lacking good faith. But the announcement that Ukreximbank had become the first debt-owing entity to reach a preliminary agreement with bondholders brought a significant change of mood within the Kiev government. Welcoming the "successful" conclusion of negotiations on Ukreximbank's 2015, 2016 and 2018 bonds, the finance ministry said: "The Ministry aims to complete the debt restructuring operation by the first review of the IMF-supported program scheduled for June in order to provide support for the disbursement of the second tranche." The second tranche of credit under the IMF's $17.5 billion extended fund facility amounts to around $2.6 billion, the central bank says. Read more.

Wed., May 27, 2015

When the world’s top finance ministers and central-bank chiefs meet in Dresden this week, they may struggle to stick to an agenda set by their German hosts that doesn’t mention Greece, Bloomberg News reported. The Group of Seven meeting starting on Wednesday will officially focus on big-picture themes of economic growth, tax evasion and strengthening the global financial architecture. Yet the most pressing matter for many of the policy makers attending is whether Greece can stay in the euro, and whether the world can handle the consequences if it can’t. Time is running out for the Mediterranean country to reach agreement with its German-led creditors over economic reforms needed to unlock bailout funds before loans from the International Monetary Fund come due next month. That’s leading non-European observers, like officials from the U.S. Treasury, to warn of unpredictable consequences if Greece and its partners don’t manage to avert a default. Read more.

Wed., May 27, 2015

Skymark Airlines Inc's biggest creditor, aircraft leasing company Intrepid Aviation Ltd , plans to try to block ANA Holdings Inc from taking a 16.5 percent stake in the failed Japanese discount carrier, two people said. The decision by Intrepid to try to stop ANA from becoming a sponsor for Skymark's revival from bankruptcy comes after ANA, Japan's biggest carrier, withdrew from an agreement with Intrepid to lease up to seven jetliners, said the people, who have direct knowledge of the talks. They spoke on condition of anonymity because the talks weren't public. Managers charged with reviving Skymark need approval of a majority of debt holders to appoint sponsors. Intrepid holds about a third of Skymark's total debt of around 300 billion yen ($2.45 billion). The leasing company's opposition threatens ANA's plan to become a major shareholder in the discount carrier giving it access to valuable landing rights at Tokyo's crowded Haneda airport. ANA already controls more than half of the landing slots at the capital's downtown airport, and adding more would bolster its lead over local rival Japan Airlines Co. Read more.

Wed., May 27, 2015

Romanian state-owned electricity producer Hidroelectrica will not exit the insolvency process this year, as initially expected, due to lengthy court actions, the company’s legal administrator said in an interview with Reuters. Hidroelectrica has managed to reorganize its activity in the last three years and posted record profits in 2014 and the first quarter of 2015, but still has to solve its problems in court. “The court challenges are advancing very slowly,” said manager Remus Borza. He added the company still had 19 ongoing trials out of an initial 75. “The company will surely not exit insolvency this year. We hope next year,” Borza concluded, according to Reuters. Hidroelectrica declared insolvency in June 2012 as the company was losing money because of several large contracts to sell electricity below market prices corroborated with lower electricity production due to draught. The company lost about USD 1.4 billion over six years due to those unfavorable long-term contracts, which it cancelled after going into insolvency. However, the companies whose contracts had been cancelled, most of them electricity traders, went to court and challenged Hidroelectrica’s insolvency. This led to lengthy trials and prevented the company from coming out of the procedure. Hidroelectrica briefly existed insolvency in late 2013, but a court ruling in favor of one electricity trader sent the company back to judicial management in early 2014. Read more.

Wed., May 27, 2015

French corporate insolvencies continued to fall in April, data showed on Tuesday in the latest sign of an upturn in the euro zone's second largest economy. Figures published by French trade insurance company Coface showed there were a total of 62,473 corporate failures in the 12 months till end-April, 2.7 percent down on the previous year. That came after the 2.9 percent fall seen for the calendar 2014 year as a whole, the biggest such fall since 2010. "This trend reflects notably the temporary impact of household spending linked to lower oil prices and the improvement in corporate margins," Coface said in a statement. The figures are the latest signs of a nascent economic recovery in France, which in the first three months of 2015 saw GDP growth of 0.6 percent - surpassing market expectations for a 0.4 percent expansion and the fastest growth rate for two years. The fall came despite a temporary rise in bankruptcy filings in the first four months of 2015, partly due to strikes in industrial tribunals which delayed the recording of cases. The cost to suppliers of insolvent companies fell over the 12 months to April by 16.6 percent. The number of companies going bankrupt is still high compared to mid-2012, when just over 58,000 went insolvent in the preceding 12 months. Read more.

Wed., May 27, 2015

Royal Bank of Scotland announced yesterday that it has agreed to sell a portfolio of Ulster Bank loans in Northern Ireland to an entity affiliated with Cerberus Capital Management, the Irish Times reported. It said the disposal of this portfolio represented the “final material transaction for RBS Capital Resolution in Northern Ireland”. RCR is the UK bank’s workout vehicle for problem loans. This would appear to be RBS drawing a line under the deleveraging of non-core assets at Ulster Bank’s Northern Ireland operation relating to the global financial crash. RBS said it would receive a cash consideration of about £205 million at current exchange rates from the deal. Completion is expected in June 2015 and the sale proceeds will be used for general corporate purposes. Read more.

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