UPDATE 2-Cliffs Canada unit rail contract will be renegotiated - CEO

Tue Feb 3, 2015 3:45pm EST

(Recasts with CEO interview)

By Nicole Mordant

Feb 3 (Reuters) - An onerous transportation contract entered by Cliffs Natural Resources' Bloom Lake iron ore operation in Canada will be renegotiated under Bloom's creditor protection filing, Cliffs' chief executive said on Tuesday.

Lourenco Goncalves said the contract with the Quebec North Shore and Labrador Railway (QNSL) that has Bloom Lake on the hook for $450 million has been stayed by a Quebec judge as part of Bloom Lake's filing last week in Canada.

"It will be negotiated. When a contract is stayed it means it is no longer valid," Goncalves said in an interview.

Asked if a renegotiation could help to make Bloom Lake's assets more attractive to sell under the restructuring proceedings, he said: "This is the correct conclusion."

The rail contract makes up more than half of Bloom Lake's estimated closure costs of $650 million to $700 million. The QNSL line is a unit of Iron Ore Co of Canada (IOC), which in turn is controlled by global miner Rio Tinto.

IOC was not immediately available for comment.

CANADA SALES

Goncalves said he expects all or most of Bloom Lake's assets to be sold under the creditor protection process, possibly this year.

Cliffs was approached by "several interested parties" and the Quebec government in the past two months over the sale of Bloom Lake outside creditor protection, Goncalves said on a conference call to discuss Cliff's fourth-quarter results.

"All things being considered we are very confident the Bloom Lake Group will be done with CCAA within calendar 2015" he said.

The filing, which isolates Cliffs from losses in its Bloom Lake operations and protects shareholders, comes at a time of weak global iron ore prices.

He declined to give details of any potential buyers.

Cliffs said last October that it was in talks with three big steelmakers about selling a 30 percent stake in Bloom Lake. Goncalves had earlier this year identified the parties as U.S.-based Nucor and two Japanese steelmakers, according to a note by JPMorgan analyst Michael Gambardella.

But the sale process failed as the parties could not agree on structuring a quick deal.

Chinese steelmaker Wuhan Iron & Steel, known as Wisco, already owns a minority stake in Bloom Lake.

Bloom Lake is also looking to sell its idled Wabush iron ore mine in Eastern Canada but was not under pressure to sell it, Goncalves said.

Cliffs stock last traded down 3.3 percent at $6.74. (Reporting by Nicole Mordant in Vancouver; editing by Chizu Nomiyama and Meredith Mazzilli)

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BRIEF-Court applies one of bankruptcy proceedings at Gazpromgeofizika - bankruptcy register

Tue Feb 3, 2015 9:12am EST

* Arbitration court of Moscow on Jan. 13 applied an observation procedure to Gazpromgeofizika, according to materials posted on Monday at the website of Unified Federal Register of Information on Bankruptcy

* Pavel Bashirin has been appointed temporary manager of the company - bankruptcy register

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New Jersey's Revel Casino asks court to let sale go through

Tue Feb 3, 2015 6:56pm EST

Feb 3 (Reuters) - New Jersey's shuttered Revel Casino on Tuesday asked a federal judge to lift a stay on its pending sale to a Florida investor, arguing in a filing that creditors will be harmed if the deal does not go through soon.

IDEA Boardwalk LLC, which operated a bar and a nightclub at Revel - one of four Atlantic City casinos that closed down last year - has sued to block the sale, saying it will lose $16 million in investments under the deal.

On Friday, 3rd U.S. Circuit Court of Appeals Judge Thomas Ambro ordered the sale delayed while he studies legal challenges.

Revel Casino said in the Tuesday filing that the deal must close by Feb. 9 or it could collapse. That would be "catastrophic," the filing said, because it would destroy $100 million of creditor value, based on the sale price plus additional costs to liquidate assets.

Revel, which cost $2.4 billion to build and opened just two years ago, closed on Sept. 2 after filing for bankruptcy three months earlier. The bankruptcy court later approved a sale to Florida developer Glenn Straub for $95.4 million.

IDEA Boardwalk, along with several restaurants that had also leased space inside the casino, in January lost a federal court challenge to the sale. The nightclub then appealed.

Revel was conceived as a Las Vegas-style resort that emphasized high-end dining and eye-catching design.

The nightclub and restaurants were a popular aspect of the otherwise unsuccessful casino, and they were often full as the gaming floor and hotel rooms stood empty. (Reporting by Fiona Ortiz in Chicago; Editing by Eric Beech)

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BRIEF-Kopahaus submits insolvency plan

Mon Feb 2, 2015 2:29am EST

* Said on Sunday that it submitted to the Regional Court in Szczecin, Poland, proposal of an insolvency with liquidation plan

* Plans to cash in the company's assets via a public sale of the two organised parts of the business: production and hotels, and liquidation of all the other parts of the company

* Plans to pay with the accumulated money for the insolvency proceedings and the costs of running the company in a new form over the next 12 months following the end date of the insolvency arrangement

* Plans to change its business profile from production to retail and focus mainly on western and central Europe

* Plans to converse 20 pct of the outstanding liabilities of each creditor into shares of a new issue and write off the rest of the debt

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CORRECTED-UPDATE 2-Kaisa CEO leaves, hopes of near-term rescue deal dashed

Mon Feb 2, 2015 2:46am EST

(Corrects timing of S&P downgrade in last para)

* CEO resignation comes after string of executive departures

* Asset sales announced on Sunday to inject $380 mln into Kaisa

* Kaisa's offshore bonds surrender some gains

By Umesh Desai

HONG KONG, Feb 2 (Reuters) - China's Kaisa Group said on Monday that its chief executive officer has resigned - a further blow to the embattled property developer despite having sold some assets at the weekend to ease its short-term cash worries.

The company said Jin Zhigang had quit "to devote more time to his personal career development" and would continue as executive director. It added that there had been no disagreement with the board.

Kaisa's bond prices fell after the announcement, with investors disappointed that Sunday's news of 2.37 billion yuan ($380 million) of asset sales in Shanghai was not the full-blown rescue deal they had been hoping for.

It was not immediately clear who would be replacing Jin, who had been at the helm since 2012. Company officials were not available for comment about his successor.

Kaisa, a homebuilder based in the southern Chinese city of Shenzhen, is struggling to meet its debt obligations following the abrupt departure of a string of senior executives and a local government block on its property sales.

Bondholders are worried it may become the first Chinese homebuilder to default on its foreign bonds.

Kaisa said on Sunday that Sunac China Holdings would buy two of its units in Shanghai and acquire majority stakes in two others.

"The most immediate concern for offshore bondholders is whether Sunac's involvement would be limited to the purchase of these properties," said Dilip Parameswaran, chief executive at Asia Credit Advisors.

"If that is the case, the purchase consideration is likely to be claimed first by onshore lenders, leaving little benefit for offshore lenders."

At least 28 court filings requesting an asset freeze were made by onshore creditors against Kaisa and its subsidiaries between Jan. 6 and Jan. 9 in Shenzhen, according to records in the city's Intermediate People's Court, involving 17 financial institutions.

RESCUE HOPES

Kaisa's bonds plunged in December after Shenzhen sales were blocked but they had started to recover on rising hopes of a white knight rescue deal.

However on Monday its bonds due 2020, on which the company missed a coupon payment deadline last month, were down 11 points at 61/66 from their overnight levels.

Investors are mindful that the projects sold at the weekend are in Shanghai, while Kaisa's problematic projects that are subject to sales blocks are in Shenzhen.

However some analysts said Sunday's deal could be the first step in a series of transactions between Kaisa and Sunac.

"Yesterday's transaction could provide Kaisa with the funds required to hold off default, giving Sunac further time to structure a more comprehensive deal," said Mark Reade of Mizuho Securities.

Last week, financial news magazine Caixin said Sunac China had agreed to buy a 49.3 percent stake in Kaisa, citing an unidentified senior company executive.

Possible political problems are also adding to the slow progress on resolving Kaisa's problems, with the reason for the sales blocks in Shenzhen still unclear.

Last week local officials said the government "needs some time to resolve this incident" as the case is linked to China's crackdown on corruption, according to local Chinese media reports.

At their lows, Kaisa's bonds had lost as much as two-thirds of their value, since the decline started in early December. Shares halved in a one-month plunge before trading was suspended in December.

Kaisa is in a 30-day grace period after it missed the January 8 due date for a $26 million coupon payment on its bonds. Just before the payment deadline, Standard & Poor's inflicted a seven-notch downgrade on Kaisa, taking it down to SD or selective default. ($1 = 6.2585 Chinese yuan renminbi) (Additional reporting by Donny Kwok and Clare Jim; Editing by Edwina Gibbs and Rachel Armstrong)

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UPDATE 3-Kaisa CEO leaves, hopes of near-term rescue deal dashed

Mon Feb 2, 2015 3:08am EST

* CEO resignation comes after string of executive departures

* Asset sales announced on Sunday to inject $380 mln into Kaisa

* Kaisa's offshore bonds surrender some gains (Adds comment from Standard & Poor's)

By Umesh Desai

HONG KONG, Feb 2 (Reuters) - China's Kaisa Group said on Monday that its chief executive officer has resigned - a further blow to the embattled property developer despite having sold some assets at the weekend to ease its short-term cash worries.

The company said Jin Zhigang had quit "to devote more time to his personal career development" and would continue as executive director. It added that there had been no disagreement with the board.

Kaisa's bond prices fell after the announcement, with investors disappointed that Sunday's news of 2.37 billion yuan ($380 million) of asset sales in Shanghai was not the full-blown rescue deal they had been hoping for.

It was not immediately clear who would be replacing Jin, who had been at the helm since 2012. Company officials were not available for comment about his successor.

Kaisa, a homebuilder based in the southern Chinese city of Shenzhen, is struggling to meet its debt obligations following the abrupt departure of a string of senior executives and a local government block on its property sales.

Bondholders are worried it may become the first Chinese homebuilder to default on its foreign bonds.

Kaisa said on Sunday that Sunac China Holdings would buy two of its units in Shanghai and acquire majority stakes in two others.

"The most immediate concern for offshore bondholders is whether Sunac's involvement would be limited to the purchase of these properties," said Dilip Parameswaran, chief executive at Asia Credit Advisors.

"If that is the case, the purchase consideration is likely to be claimed first by onshore lenders, leaving little benefit for offshore lenders."

At least 28 court filings requesting an asset freeze were made by onshore creditors against Kaisa and its subsidiaries between Jan. 6 and Jan. 9 in Shenzhen, according to records in the city's Intermediate People's Court, involving 17 financial institutions.

RESCUE HOPES

Kaisa's bonds plunged in December after Shenzhen sales were blocked but they had started to recover on rising hopes of a white knight rescue deal.

However on Monday its bonds due 2020, on which the company missed a coupon payment deadline last month, were down 11 points at 61/66 from their overnight levels.

Investors are mindful that the projects sold at the weekend are in Shanghai, while Kaisa's problematic projects that are subject to sales blocks are in Shenzhen.

However some analysts said Sunday's deal could be the first step in a series of transactions between Kaisa and Sunac.

"Yesterday's transaction could provide Kaisa with the funds required to hold off default, giving Sunac further time to structure a more comprehensive deal," said Mark Reade of Mizuho Securities.

Credit rating agency Standard & Poor's said it was still doubtful though that Kaisa would be able to meet its upcoming debt obligations, despite the asset sale.

"It's quite remote that Kaisa can meet its debt obligation in the next few months without any changes to the current situation," said the rating agency's director Christopher Yip in a conference call.

Yip estimated the company needs to repay a total of 5 billion yuan in onshore and offshore loans by the end of June. Kaisa also has coupon payments due on its 2017 and 2018 bonds in March, according to Thomson Reuters data.

Last week, financial news magazine Caixin said Sunac China had agreed to buy a 49.3 percent stake in Kaisa, citing an unidentified senior company executive.

Possible political problems are also adding to the slow progress on resolving Kaisa's problems, with the reason for the sales blocks in Shenzhen still unclear.

Last week local officials said the government "needs some time to resolve this incident" as the case is linked to China's crackdown on corruption, according to local Chinese media reports.

At their lows, Kaisa's bonds had lost as much as two-thirds of their value, since the decline started in early December. Shares halved in a one-month plunge before trading was suspended in December.

Kaisa is in a 30-day grace period after it missed the January 8 due date for a $26 million coupon payment on its bonds. Just before the payment deadline, Standard & Poor's inflicted a seven-notch downgrade on Kaisa, taking it down to SD or selective default. ($1 = 6.2585 Chinese yuan renminbi) (Additional reporting by Donny Kwok and Clare Jim; Editing by Edwina Gibbs and Rachel Armstrong)

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Brazil OAS says to appeal court decision seizing its assets

SAO PAULO Fri Jan 30, 2015 3:45pm EST

SAO PAULO Jan 30 (Reuters) - Brazilian construction group OAS SA, struggling with rampant debt and the impact of a corruption probe on a key client, said on Friday that it plans to appeal a court decision seizing some of the shares it owns in infrastructure firm Invepar SA.

In a statement to Reuters, OAS said it has yet to be notified of the decision by a Sao Paulo Justice Court judge to seize 8.9 percent of the shares it owns in Invepar.

"We understand that the ruling was made based on incomplete information provided by the plaintiffs and that in no way reflect our ongoing efforts," the statement said. "At no moment did OAS attempt to give preferential treatment to any creditor, nor transfer assets in order to deplete its equity." (Reporting by Guillermo Parra-Bernal; Editing by Alan Crosby)

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RPT-UPDATE 1-Brazil court seizes some of builder OAS's Invepar shares

Fri Jan 30, 2015 5:55pm EST

(Repeats to additional subscribers) (Adds OAS statement)

SAO PAULO Jan 30 (Reuters) - A Brazilian state court on Friday seized an 8.9 percent stake in Investimentos e Participações em Infraestrutura SA owned by construction group OAS SA, alleging the debt-ridden builder is in imminent risk of insolvency.

Judge Roberto Corcioli Filho of the Justice Court of São Paulo state said in a telephone interview that the seizure had been requested by Pentágono SA DTVM, a trustee representing the holders of 160 million reais ($60 million) of OAS local debt notes.

OAS holds a 25 percent stake in Invepar through its wholly controlled OAS Infraestrutura SA subsidiary.

Corcioli's order followed OAS's decision to move some of the 105 million common and preferred shares it owns in the infrastructure company, also known as Invepar.

The trustee suspects OAS transferred the shares to protect them from the note holders and other creditors, according to court documents.

OAS plans to appeal the ruling, which it said was made on incomplete information from the plaintiffs.

"At no moment did OAS attempt to give preferential treatment to any creditor or transfer assets in order to deplete its equity," it said in a statement.

OAS reiterated it will soon present a restructuring plan to creditors that could include asset sales to raise cash and lower its debt.

Corcioli said the asset seizure was pre-emptive and could be reversed if OAS proved the securities transfer was legal.

The seizure comes as OAS struggles with the impact from a graft and money-laundering scandal at key client Petrobras , which has undercut the state-run oil company's own access to financing and revenue.

OAS failed to pay interest on $400 million of global bonds and on 100 million reais of debt earlier this year, and bankers are speculating a sale of its Invepar stake could help raise cash to honor some obligations.

Some of Brazil's largest construction companies are facing more scrutiny and limited access to bond and loan markets after federal prosecutors found that executives at Petrobras took bribes in exchange for building, leasing and other contracts.

The price of OAS's 8.25 percent bond due in October 2019 was little changed on Friday at 13.60 cents on the dollar from 12.50 cents on Thursday. At those levels, the yield on the bond is around 85 percent. (Reporting by Guillermo Parra-Bernal. Editing by Matthew Lewis)

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CORRECTED-Brazil court seizes some of builder OAS's shares in Invepar

Fri Jan 30, 2015 5:58pm EST

(Corrects last paragraph to show the OAS bond was at 12.50 cents on Thursday, not at 13.55 cents on Friday, and that the yield was around 85 percent, not 81 percent.)

SAO PAULO Jan 30 (Reuters) - A court in Brazil's São Paulo state seized on Friday 8.9 percent of the shares that construction group OAS SA has in infrastructure company Investimentos e Participações em Infraestrutura SA, alleging that the debt-ridden group is in imminent risk of insolvency.

Judge Roberto Corcioli Filho of the state of São Paulo Justice Court told Reuters that he ordered the seizure at the behest of Pentágono SA DTVM, which as a trustee represents the interests of holders of 160 million reais ($60 million) in OAS local debt notes.

Corcioli's order followed OAS's decision to move around some of the 105 million common and preferred shares it owns in the infrastructure firm, known as Invepar. The plaintiffs suspect OAS transferred the shares to protect them from their clients, the note holders, and other creditors, according to court documents.

Corcioli said in a phone interview that the decision was a temporary, pre-emptive measure which could also be appealed. It could be reversed should OAS prove the transfer of the securities was legal, he added. OAS did not have an immediate comment.

The seizure comes as OAS struggles with the impact from a graft and money-laundering scandal afflicting key client Petrobras, which has undercut its own access to financing and revenue flow.

OAS failed to pay interest on $400 million of global bonds and on 100 million reais of debt earlier this year, and bankers are speculating that a sale of the stake in Invepar could help OAS raise cash to honor some obligations. OAS controls a 25 percent stake in Invepar through its wholly controlled OAS Infraestrutura SA subsidiary.

Some of Brazil's largest civil construction companies are facing increased scrutiny and limited access to bond and loan markets after federal prosecutors found that executives at state-controlled Petrobras negotiated bribes in exchange for building, leasing and other contracts.

The price on OAS's 8.25 percent bond due in October 2019 was little changed on Friday at 13.60 cents on the dollar, from 12.50 cents on Thusday. At those levels, the yield on the bond is around 85 percent. (Reporting by Guillermo Parra-Bernal; editing by Matthew Lewis)

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RPT-UPDATE 1-Brazil court seizes some of builder OAS's Invepar shares

Fri Jan 30, 2015 5:55pm EST

(Repeats to additional subscribers) (Adds OAS statement)

SAO PAULO Jan 30 (Reuters) - A Brazilian state court on Friday seized an 8.9 percent stake in Investimentos e Participações em Infraestrutura SA owned by construction group OAS SA, alleging the debt-ridden builder is in imminent risk of insolvency.

Judge Roberto Corcioli Filho of the Justice Court of São Paulo state said in a telephone interview that the seizure had been requested by Pentágono SA DTVM, a trustee representing the holders of 160 million reais ($60 million) of OAS local debt notes.

OAS holds a 25 percent stake in Invepar through its wholly controlled OAS Infraestrutura SA subsidiary.

Corcioli's order followed OAS's decision to move some of the 105 million common and preferred shares it owns in the infrastructure company, also known as Invepar.

The trustee suspects OAS transferred the shares to protect them from the note holders and other creditors, according to court documents.

OAS plans to appeal the ruling, which it said was made on incomplete information from the plaintiffs.

"At no moment did OAS attempt to give preferential treatment to any creditor or transfer assets in order to deplete its equity," it said in a statement.

OAS reiterated it will soon present a restructuring plan to creditors that could include asset sales to raise cash and lower its debt.

Corcioli said the asset seizure was pre-emptive and could be reversed if OAS proved the securities transfer was legal.

The seizure comes as OAS struggles with the impact from a graft and money-laundering scandal at key client Petrobras , which has undercut the state-run oil company's own access to financing and revenue.

OAS failed to pay interest on $400 million of global bonds and on 100 million reais of debt earlier this year, and bankers are speculating a sale of its Invepar stake could help raise cash to honor some obligations.

Some of Brazil's largest construction companies are facing more scrutiny and limited access to bond and loan markets after federal prosecutors found that executives at Petrobras took bribes in exchange for building, leasing and other contracts.

The price of OAS's 8.25 percent bond due in October 2019 was little changed on Friday at 13.60 cents on the dollar from 12.50 cents on Thursday. At those levels, the yield on the bond is around 85 percent. (Reporting by Guillermo Parra-Bernal. Editing by Matthew Lewis)

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