BRIEF-Ten will issue 4 mln Series E preferred shares at a price to public of $25 per share
* Ten Ltd. announces pricing of its successful public offering of its series e fixed-to-floating rate cumulative redeemable perpetual preferred shares
(The following statement was released by the rating agency) Overview -- On May 11, AmBev's purchase of Dominican Republic-based beer and malt producer and distributor CND was completed. -- We are raising the rating CND to 'BB' from 'B+' and removing it from CreditWatch with positive implications. -- The stable outlook reflects our view that AmBev's strong implicit and explicit support to CND will remain in the future. Rating Action On July 9, 2012, Standard & Poor's Ratings Services raised its rating on Cerveceria Nacional Dominicana S.A. (CND) to 'BB' from 'B+', two notches above the sovereign rating on the Dominican Republic. In addition, we removed the rating from CreditWatch with positive implications, where we placed it on April 17, 2012. The outlook is stable. Rationale The rating action reflects the completion of AmBev - Companhia de Bebidas das Americas' acquisition of 51% of CND, which was announced on April 16. We believe CND is a strategically important investment for AmBev and we have incorporated two notches of support from AmBev to our corporate credit rating on CND. Through this transaction, Ambev will become the biggest beverage company in the Caribbean, and we believe its operation in this region will be highly strategic for the company. We expect AmBev to provide strong implicit and explicit support to CND, even in a default case scenario of the Dominican Republic. This support is evident through the recent redemption of CND's senior unsecured notes due 2014, which the company will refinance at a lower interest rate through a bank loan that AmBev will guarantee. We consider the company's business risk profile as "weak" and its financial risk profile as "significant." Additionally, we expect that CND will benefit from synergies, integration of logistics and commercial agreements, economies of scale in raw material sourcing and distribution, and further expansion of its brands to other markets. During the first three months of 2012, CND has continued to improve its financial metrics through debt reduction and refinancing, as well as an improvement of its EBITDA margins, thanks to a better product mix and higher sales volumes, mainly exports. For the 12 months ended March 31, 2012, CND posted an EBITDA margin of 29%, total debt to EBITDA of 2.3x, funds from operations (FFO) to total debt of 29.5%, and EBITDA interest coverage of 3.4x, compared with 26.1%, 3.2x, 19%, and 2.6x for the same period in 2011. Under our base-case scenario, CND's revenues will increase 5% and EBITDA margins to 35% by 2015, due to the expected synergies and cost reductions from the AmBev's purchase. These figures will improve the company's key financial metrics: debt to EBITDA of 2.1x, FFO to debt of 25.1%, and EBITDA interest coverage of 5.3x by the end of 2012. Free operating cash flow is expected to remain positive, at about Dominican peso (DOP) 2.0 billion. Our ratings on CND reflect our view of the country and macroeconomic risk of the Dominican Republic, the company's exposure to the country's economic cycles, and certain foreign-currency exposure related to its dollar-denominated debt, as most of its revenues are denominated in Dominican pesos. The somewhat offsetting factors are the strong explicit and implicit support from AmBev, CND's leading industry position in the Caribbean, its strong distribution capabilities in a fragmented retailer system, solid and longstanding brand recognition, the improving acceptance of its products in international markets, and adequate liquidity. Liquidity We consider CND's liquidity to be "adequate" under our criteria. During the past 12 months, CND substantially improved its debt maturity profile through the refinancing of short-term liabilities and reduction of debt. For the following 12 months ending March 31, 2013, sources of liquidity will likely include cash of DOP1.121 billion and FFO of about DOP3.630 billion. Cash uses are likely to include DOP1.784 billion in short-term debt maturities and approximately DOP1.763 billion for working capital requirements, capital expenditures, and dividend payments. We expect sources of liquidity to exceed uses by 1.4x for 2012 and 1.7x for 2013, and net sources to remain positive even with a 15%-20% decline in EBITDA. Given the company's improved financial metrics, its covenant headroom has widened. We anticipate this comfortable buffer to remain in the next two years with a cushion of more than 50%. Outlook The stable outlook reflects our view that AmBev's strong support to CND will allow it to improve its profitability and reduce its financing and operating costs. We could lower the rating if this support does not continue, if we downgrade the Dominican Republic, and although highly unlikely, if the company's financial risk profile significantly weakens. Our view of country risk and the current transfer and convertibility assessment of the Dominican Republic constrains an upgrade. Related Criteria And Research -- Methodology And Assumptions: Liquidity Descriptors For Global Corporate Issuers, Sept. 28, 2011 -- Credit FAQ: Understanding Ratings Above The Sovereign, Aug. 8, 2011 -- Key Credit Factors: Criteria For Rating The Global Branded Nondurable Consumer Products Industry, April 28, 2011 -- Business Risk/Financial Risk Matrix Expanded, May 27, 2009 -- 2008 Corporate Criteria: Analytical Methodology, April 15, 2008 -- Corporate Criteria--Parent/Subsidiary Links; General Principles; Subsidiaries/Joint Ventures/Nonrecourse Projects; Finance Subsidiaries; Rating Link to Parent, Oct. 28, 2004 Ratings List Upgraded; CreditWatch/Outlook Action To From Cerveceria Nacional Dominicana S.A. Corporate Credit Rating BB/Stable/-- B+/Watch Pos/-- Senior Unsecured BB B+/Watch Pos (Caryn Trokie, New York Ratings Unit)
CALGARY, Alberta, March 29 ConocoPhillips on Wednesday agreed to sell oil sands and western Canadian natural gas assets to Cenovus Energy Inc for C$17.7 billion ($13.3 billion), making it the latest international oil major to pull back from the region.