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       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 5, 2001, Vol. 2, Issue 25

                           Headlines



B A R B A D O S

SUPER POULTRY: Shuts Down Business; Lays Off 75 Workers


B R A Z I L

BANESPA: Court Rules Bank Cannot Keep Escrow Deposits
BANESPA: Registers $2.1Billion Loss By End November 2000
CEMIG: Contracting Company To Build Transmission Line In 2H01
CHRYSLER: To Produce New Vehicle At Brazilian Plant
CHRYSLER: Drastic Staff Reductions To Cost More Than $2 Billion
TUTOPIA.COM: Launches PRECISIONTEK, On-Line Direct Marketing
UOL: Increases Prices To Restore Profitability


C H I L E

ILH: Denies Reports Of E-Commerce Subsidiary's Imminent Closure


H O N D U R A S

INTERNET TELECOMMUNICATIONS: Dismantled By Honduran Authorities


M E X I C O

CINTRA: Shareholders To Get Pro Rata Share In 7 Subsidiaries
GRUPO BITAL: IPAB To Present Final Proposal
TRANSPORTACION FERROVIARIA: Northeast Line Back On The Table
XEROX: Details From Investigation of Mexico Accounting Issues


N I C A R A G U A

ENEL: To Publish Bidding Rules By Mid-February


V E N E Z U E L A

DE REMATE.COM: Cuts Workforce To Reduce Operating Costs


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B A R B A D O S
===============

SUPER POULTRY: Shuts Down Business; Lays Off 75 Workers
-------------------------------------------------------
Super Poultry Foods, which merged with Chickmont Foods Limited in
November 1999, has been shut down and 75 workers have been laid
off, Caribbean News Agency said Thursday. Chickmont Foods
manager, Edward Albecker, believes the closure will somehow
increase industry efficiency and will put Chickmont Foods in a
better position in a highly competitive market.

When the Barbados market was opened up to competition last April
in compliance with World Trade Organisation rules on global free
trade, local players expected stiff competition, but not the
onslaught that actually occurred, Albecker related.

He contended that the approximate 22 containers of imported
chicken - 1.7 million kg - allowed into the island devastated
poultry producers. Chickmont was forced to institute a 20 per
cent cutback on its farmers with no indication that this
situation will improve, Albecker explained.



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B R A Z I L
===========

BANESPA: Court Rules Bank Cannot Keep Escrow Deposits
-----------------------------------------------------
The Sao Paulo state Justice Court ruled that Banco do Estado de
Sao Paulo SA (BANESPA) cannot keep as much as 2.8 billion reais
in escrow deposits, Bloomberg said Thursday. The move supports an
earlier decision by the chief judges of the state's judicial
system requesting the bank a transfer escrow deposits related to
legal cases in the state justice system to the state-owned Nossa
Caixa Nosso Banco.

Luiz Roberto de Assis, a lawyer specializing in banks at Sao
Paulo-based Levy & Salomao Associados, said that Banespa can
appeal the decision in the country's superior court in Brasilia,
which is expected to make a final ruling. Escrow deposits
reportedly accounted for 45 percent of Banespa's time deposits.

The council further ruled that Banespa must close 190 automated
teller machines in court buildings throughout the state.


BANESPA: Registers $2.1Billion Loss By End November 2000
--------------------------------------------------------
Sao Paulo bank Banespa reported a R$2.1-billion loss for the 11
months ending November 2000, Brazil Financial Wire reported
Thursday. In a statement sent to the Sao Paulo bourse, the
company stated a R$324.1-million profit in the first half period
and a R$2.435-billion loss in the July-November period.

Banco Santander Central Hispano of Spain (BSCH) purchased 30
percent of Banespa in November and later launched a bid for the
remaining 67 percent of the bank in an all-cash deal worth about
$1.2 billion.


CEMIG: Contracting Company To Build Transmission Line In 2H01
-------------------------------------------------------------
A Cemig transmission department source said in a BNamericas.com
report published Thursday that the state integrated power company
would contract a company or consortium in the second half of this
year to build a 130km, 138kV transmission line.

"At the moment we are finalizing the feasibility study of the
line, which will connect the cities of Itajuba and Sao Lourenco
in the south of Minas Gerais," the source said.

"We know the contract value is important, and therefore the
company could launch a tender for the project, but this is yet to
be decided and contracting could be done through invitations,"
added the source, without confirming the exact value of the
contract.

Cemig serves Minas Gerais state and is 51-percent-controlled by
the state government.


CHRYSLER: To Produce New Vehicle At Brazilian Plant
---------------------------------------------------
Chrysler, which earlier last week announced it would halt
production of its Dakota pickup trucks in Brazil, said it is
likely to produce a new vehicle at its Campo Largo plant to
replace Dakota line.

"Chrysler is not considering halting investments or closing its
Brazilian plant," Alcides Tápias, Brazil's Minister of
Development, Industry and Foreign Trade, said in a Brazil
Financial Wire report released Thursday.

Officials at Chrysler said that the company doesn't intend to lay
off its 250 workers at Campo Largo plant over the next 90 days,
Tápias added.

According to a TCR-LA report released last week, Daimler received
many incentives to set up the plant in the Parana state. These
include the exemption of the ICMS tax, on land and
infrastructure.

The automaker is recently undergoing a worldwide restructuring
effort to restore profitability.


CHRYSLER: Drastic Staff Reductions To Cost More Than $2 Billion
---------------------------------------------------------------
Chrysler's plan to dismiss 26,000 workers over the next three
years will cost the automaker more than 2 billion dollars,
according to industry analysts' estimates in a Reforma/Infolatina
report released Thursday. Analysts said that early retirement and
voluntary redundancy packages paid to U.S. workers would cost the
company about $50,000 per employee. Each dismissal of a worker
who does not wish to leave Chrysler's employ will cost the
company an estimated $182,000.


TUTOPIA.COM: Launches PRECISIONTEK, On-Line Direct Marketing
------------------------------------------------------------
Tutopia.com, the direct marketing and communications company that
pioneered free Internet access pan-regionally in Latin America,
announced today the launch of PRECISIONTEK(sm) -- an innovative
technology that will revolutionize the on-line Latin American
advertising market.

PRECISIONTEK(sm) is an innovative advertising system and database
management tool that enables advertisers to accurately reach
their target market based on demographic, psychographic and
geographic profiles without compromising user privacy. Service
offerings range from targeted banner and email marketing
campaigns to online market research.

Tutopia is a leading provider of Internet access with
approximately 2 million registered users accounting for 16% of
the region's Internet population and hundreds of thousands of
profile combinations within the Tutopia database. Each Tutopia
user has provided extensive demographic information along with
data on hobbies and interests. Based upon this profile,
advertisers are able to precisely target the exact consumer
segment they want to reach. This win-win situation enables both
consumers and advertisers to benefit from ads that have been
designed with the user's specific interests in mind.

"The success of online advertising requires a level of targeting
and personalization that offers advertisers an effective way to
reach a massive audience," said Jack Bursztyn, President of
Tutopia. "The combination of Tutopia's extensive database and
unique PRECISIONTEK(sm) technology positions Tutopia as a leading
media company that can revolutionize the online advertising
industry by allowing marketers innovative ways to advertise
effectively and reach their specific goals and objectives
economically."

Tutopia has a reach/circulation higher than the top print
publications in most of its markets. Additionally, the cost per
thousand (CPM) is lower than or comparable to most traditional
off-line media and online sites.

One of the unique advantages of PRECISIONTEK(sm) is the power to
send a specific advertising message to a pre-specified target
audience. This way there is no dispersion of impressions outside
the target, avoiding wasted resources and offering a better
cost/benefit to the advertiser. If an advertiser wants to target
men, 28-55 years old in a specific zipcode of Argentina that are
lawyers, play golf and have purchased on the Internet -- Tutopia
can reach them.

Another advantage is that since Tutopia is an Internet access
provider, as opposed to a portal, advertising is delivered to the
user the entire time they are connected and on all the sites they
are surfing. The technology accommodates rich media including
audio, visual, flash and animation.

Tutopia also serves as a one-stop-shop, as advertising can be
delivered via selected keywords across all major search engines
or URLs by website or industry -- avoiding multiple media
purchases.


UOL: Increases Prices To Restore Profitability
----------------------------------------------
In an attempt to bring back profitability, Brazilian access and
content provider UOL (www.uol.com.br) raised the price of its
access service two weeks ago to US$12.7 (R$25) from US$10.1
(R$20) per month, BNamericas.com reported Thursday. In addition,
UOL's free access division, Brasil Online (BOL), began charging
US$10.1 per month for access. No word yet on any name changes for
the "free access" division.

According to UOL Brasil general manager Caio Tulio, UOL, which
was created in 1996, was profitable until March 1999 when foreign
competitors entered their market. Since then the company has been
struggling with losses, growing exponentially from US$4.7 million
in the first quarter of 1999 to US$40.7 million in the third
quarter of 2000.

"We have to get the profits back. UOL does not have infinite
resources," Caio Tulio said.

Regarding UOL's planned IPO, which has been delayed indefinitely
because of market conditions, Tulio said the company is still
waiting for the right moment to go public.



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C H I L E
=========

ILH: Denies Reports Of E-Commerce Subsidiary's Imminent Closure
---------------------------------------------------------------
Patricio Millas, executive vice-president of Santiago-based
Ilatinholdings (www.ilatinholdings.com), disputed an El Mercurio
newspaper report, which hinted that the company would close down
its e-commerce subsidiary El Golpe (www.elgolpe.com),
BNamericas.com reported Thursday. One of the reasons for the
impending closure was that Carlos Slim, who owns a 40 percent
stake in IHL, also has an equity position in its direct
competitor e-tailer Fiera (www.fiera.com).

"It doesn't matter if one of our shareholders has stakes in other
projects. What interests us is giving value to our shareholders
as a whole, not to some in particular, and with this in mind we
look for profitability in all our investments," Millas countered.

El Golpe belongs to the site network El Area (www.elarea.com),
which is controlled by Ilatinholdings (previously known as
Internet Holdings).



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H O N D U R A S
===============

INTERNET TELECOMMUNICATIONS: Dismantled By Honduran Authorities
---------------------------------------------------------------
The Internet Telecommunications Service company, which was
authorized to offer Internet, e-mail and other related services,
has been dismantled by the Honduran authorities, Agencia EFE
reported Thursday. The move was to penalize the company for
defrauding the state telecommunications company out of millions
of dollars by illegally placing international phone calls at
national rates via the Internet.

According to criminal court Judge Ana Pineda, the company made
national calls but used the Internet to convert them into
international calls.

The company made international calls for 60 cents per minute, the
national long-distance rate charged by the Honduran
Telecommunications Company (HONDUTEL). However, HONDUTEL's rates
for international calls is $1.20 per minute.



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M E X I C O
===========

CINTRA: Shareholders To Get Pro Rata Share In 7 Subsidiaries
------------------------------------------------------------
Mexican bank bailout agency IPAB said it would ensure that all
the shareholders of Cintra are treated fairly during the
impending breakup and sale of the company, Reforma/Infolatina
said Thursday. According to the agency, prior to the sell-offs,
each shareholder will be assigned a proporational amount of
equity in each of Cintra's seven subsidiaries based on their
respective position in the original holding company.

Cintra's shareholders, in addition to IPAB, include Mexican banks
Banamex and Bancomer, the country's Finance ministry and state-
run development bank Nacional Financiera (Nafin).

IPAB holds the 51-percent controlling stake in the airline
holding company.


GRUPO BITAL: IPAB To Present Final Proposal
-------------------------------------------
Mexican bank bailout agency IPAB was expected to present a
proposal to Grupo Financiero Bital last week. The proposal was
supposed to help resolve the Grupo Bital's problem concerning its
acquisition of government-intervened Banco Altantico,
Reforma/Infolatina said Thursday. Bital needs about 12 billion
pesos to recapitalize Atlantico. However, the law requires IPAB
to limit the amount it can inject to 8 billion pesos. As a
result, Bital must furnish the remaining 4 billion pesos. If
Bital can't come up with the balance, IPAB will be prompted to
take back control of Atlantico from Bital.


TRANSPORTACION FERROVIARIA: Northeast Line Back On The Table
--------------------------------------------------------------
Transportacion Ferroviaria Mexicana (TFM) is back in talks with
the Mexican ministries of Finance and Communications and
Transport over a deal to acquire the government's 20-percent
stake in the Northeast Line, reported Reforma/Infolatina
Thursday. Current discussions are reportedly centered once again
on the exact value of the governmet's position. TFM thinks it is
worth around $150 million. However, the government is holding out
for more than $200 million.

Transportacion Ferroviaria Mexicana (TFM) is a subsidiary of
Transportacion Maritima Mexicana (TMM).


XEROX: Details From Investigation of Mexico Accounting Issues
----------------------------------------------------------------
"Managers of Xerox Mexico circumvented corporate accounting
policies, ethics policies and engaged in collusion"

Xerox Corporation (NYSE:XRX) today announced the conclusion and
findings of an independent investigation of its Mexican
subsidiary.

The investigation commissioned by Xerox and conducted by external
legal and accounting firms determined that the improprieties were
caused by the convergence of several disparate factors including
the dominating management styles of certain Xerox Mexico
executives, the desire of those managers to drive growth at any
cost, and implementation of questionable business decisions and
practices. The investigation also concluded that upon learning of
the problem, and ascertaining and verifying the extent of the
issue, the company's response and plan of corrective action was
timely and proper.

"Several managers of Xerox Mexico circumvented well-established
corporate accounting and ethics policies and practices, and
engaged in collusion," said Barry Romeril, chief financial
officer of Xerox Corporation. "Their actions were deplorable.
These managers were promptly removed from their positions as soon
as we learned of the problem. We subsequently terminated them
after confirming the nature and extent of their involvement.
However, their actions resulted in a broken trust with our
customers and a troubling sense of dishonor shouldered by all of
our conscientious Xerox Mexico employees who abide by Xerox
ethics policies and practices."

Xerox management uncovered the issues and informed the Board of
Directors, and the Audit Committee immediately commissioned the
independent investigation last June.

The committee engaged the law firm of Akin, Gump, Strauss, Hauer
& Feld, which enlisted the assistance of the independent
accounting firm of PricewaterhouseCoopers, to perform the
investigation to determine whether current or former employees of
Xerox Mexico or Xerox Corporation had engaged in any practices
that violated either Xerox policies or accepted accounting and
record-keeping standards.

The investigation revealed irregularities including: ineffective
collection actions and inappropriate re-aging of past-due
accounts; billing inaccuracies; insufficient bad-debt reserves;
improper transaction classification pertaining to the sale, lease
or rental of equipment; failure to adhere to Xerox's well-
developed and extensive corporate policies and procedures; and
inadequate internal controls including appropriate segregation of
duties. The report made recommendations to enhance controls and
processes, many of which were already under way. These are all
being implemented with the oversight of the Audit Committee of
the Board.

A week after Xerox publicly disclosed the accounting issues in
Xerox Mexico last June, the Securities and Exchange Commission
initiated a non-public investigation. Xerox has been fully
cooperating with the SEC and, once completed, shared the results
of its independent investigation with the SEC staff.

Separately, Xerox launched a worldwide review of its internal
audit controls to ensure that the issues identified in Mexico
were not present elsewhere. This review was recently completed.
The issues identified in Mexico were not found in any other major
unit operated by Xerox. As a result of the review, Xerox has
increased receivables reserves in certain smaller Latin American
countries.

"We are confident that this unfortunate and regrettable incident
was the result of special circumstances conducted by a small
group of senior Xerox Mexico and Latin American group executives
in collusion to circumvent our policies and practices. We can say
with confidence that the appropriate corrective actions were
taken and that those who were responsible were removed," said
Paul A. Allaire, Xerox chairman and chief executive officer.

Xerox in 2000 took a $120 million after-tax provision in
association with the accounting issues in Mexico.



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N I C A R A G U A
=================

ENEL: To Publish Bidding Rules By Mid-February
----------------------------------------------
Enel, Nicaragua's state-owned power company, is scheduled to
release bidding rules for the sale of hydroelectric and
thermoelectric generators by mid-February, process advisor Carlos
Perez said in a BNamericas.com report released Thursday. The
generators are scheduled for privatization in May.

The sale of the thermoelectric generators was originally set for
last year, but unconstitutionality claims prompted Enel to
declare the process void. The Supreme Court ultimately rejected
these claims. Currently, Enel is just waiting for the
confirmation of SC's ruling to come in the next few days.

According to Perez, the companies that pre-qualified last year
need not present documents again in order to participate in the
sale of the thermoelectric generators. However, they will have to
present new documentation if they wish to compete for the hydro
plants.



=================
V E N E Z U E L A
=================

DE REMATE.COM: Cuts Workforce To Reduce Operating Costs
-------------------------------------------------------
The auction site De Remate.com, which launched operations in
Argentina and later expanded throughout Latin America, slashed
its labor force to cut operating costs by 25 percent, South
American Business Information said Thursday. Its Venezuelan
subsidiary, where labor redundancies are to happen, will begin to
charge a 3 to 5-percent commission on transactions through its
site. As reported, the company has made two offers to raise cash
and was able to attract US$60 million so far from partners such
as Citigroup, Merrill Lynch, e-Quest, Texas Pacific Group, and
SLI Investments. De Remate.com is one of the myriad dot.com
companies being hit by financial crisis.




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 American is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Trenton, NJ,
and Beard Group, Inc., Washington, DC. John D. Resnick, Edem
Psamathe P. Alfeche and Janice Mendoza, Editors.

Copyright 2001.  All rights reserved.  ISSN 1529-2746.

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