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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

            Wednesday, March 7, 2001, Vol. 2, Issue 46

                           Headlines



A R G E N T I N A

NEW BALANCE: Ends Argentinean Operations


B O L I V I A

COTEL: Government To Decide On 2nd International Tender Offer


B R A Z I L

CESP: State Government To Set Sale Date And Price This Week
COPENE: Central Bank To Release Sale Regulation This Week
CRT: Analyst Advises Shareholders To Accept Offer
CVRD: Sells Participation In Cenibra


C H I L E

EDELNOR: Year-End Results, Monetary Correction Quadruples Loss


E C U A D O R

EMELEC: PricewaterhouseCoopers Signs Contract With Conelec


M E X I C O

BUFETE INDUSTRIAL: Bolanos Confirms Buying Struggling Firm
CINTRA: Looming Sale Not Part Of Airline Industry Policy
PEMEX: Will Not Be Listed On Exchange Any Time Soon
XEROX CORPORATION: Schiffrin, Barroway Joins The Fray Of Suits


P E R U

AUSTRAL GROUP: To Penetrate Three More Markets


V E N E Z U E L A

LOQUESA.COM: To Implement Restructuring Plan


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A R G E N T I N A
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NEW BALANCE: Ends Argentinean Operations
----------------------------------------
The clothing company New Balance announced the closure of its
offices, warehouses and shops in the province of Buenos Aires,
according to a report released Monday by South American Business
Information. The move marks the end of the company's Argentinean
operations. According to the company, the drop in sales and
financial problems led to the decision, which came as a surprise
since just recently the American company New Balance Athletic
Shoe announced it would operate its local business directly.

Manuel Garcia the brand manager of the company in Brazil, Uruguay
and Argentina said in January they turned over US$500,000 and
US$350,000 in February. In 2000, the total turnover was $17
million.



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B O L I V I A
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COTEL: Government To Decide On 2nd International Tender Offer
-------------------------------------------------------------
The Bolivian government is expected to decide on March 15 whether
to hold a second international tender offer to find a strategic
partner for Cotel, Rene Bustillo, government appointed Cotel
manager, said in a Business News Americas report Monday.

"We sent letters to all the interested parties (who participated
in the first tender offer) and seven said they would be
interested in a second tender offer," Bustillo said. "If we are
able to get one or two firm commitments (to bid) we will go ahead
with a second round."

La Paz-based Cotel is the country's largest fixed line operator
currently under intervention. Prior to its intervention, it
operated as a privately owned cooperative offering local
telephony service. Financial backing of a foreign investor
appears to be essential for ensuring the company's future.
Currently, it is saddled with debts of US$32 million and has only
165,000 lines in service out of a total line capacity of nearly
220,000.



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

CESP: State Government To Set Sale Date And Price This Week
-----------------------------------------------------------
Sao Paulo Energy Secretariat advisor Virginia Murano says the
state government is expected to set the date and price for the
sale of a majority stake in state-owned generator Cesp Parana
this week. The announcement in a BNamericas.com report published
Monday came after the Brazilian Supreme Court lifted an
injunction preventing the filling of the reservoir at the Porto
Primavera hydroelectric plant.

"Representatives from Sao Paulo's privatization committee PED
will meet this week to set the auction date and the minimum sale
price, probably on Tuesday but we cannot guarantee that because
of the delicate health of (state) governor Mario Covas," Murano
said. According to Murano, Covas is seriously ill in hospital in
Sao Paulo with cancer.

The sale of the power generator is likely to go ahead by April on
the Sao Paulo stock exchange (Bovespa).


COPENE: Central Bank To Release Sale Regulation This Week
---------------------------------------------------------
The Brazilian Central Bank announced that the regulation for the
sale of Norquisa, the holding company for Copene, would be
published this week. The auction will likely take place by the
end of the month, according to a South American Business
Information report Monday edition. The controllers Odebrecht,
Mariani and Conepar, previously agreed to reduce the sale price
after a first attempt to sell failed in December. However, they
haven't been able to agree on the reduction percentage. It is
widely believed that the minimum price could be set at US$970
million, a 7-percent drop from the price of R$1.05 billion set in
December 2000. Ultra already offered US$822 million for Copene.


CRT: Analyst Advises Shareholders To Accept Offer
-------------------------------------------------
Market analyst Mr. Eduardo Hajime suggested that minority
shareholders of Celular CRT (Telefonica Celular) should accept
the public offer made by Telefonica Moviles, South American
Business Information said Monday. Telefonica Moviles, the
wireless arm of Spanish telephone group Telefonica, offered to
acquire 54.32 percent of the company's capital stock. The new
shares offered will be both American Depository Receipts (ADRs)
and certificates of deposit of securities (BDRs). Presently,
Telefonica Moviles owns 45.68 percent of CRT, including 75
percent of the voting shares.


CVRD: Sells Participation In Cenibra
------------------------------------
CVRD (Companhia Vale do Rio Doce) is selling its 51.48
participation in Cenibra (Celulose Nipo-Brasileira) in April of
this year, South American Business Information said Monday. Among
the companies expected to render proposal for the acquisition are
Aracruz, VCP (Votorantim Celulose e Papel), Suzano and JBP (Japan
Brazil Paper and Pulp Resources Development). JBP has the balance
of the 48.52 percent equity in Cenibra and has the first refusal
right. Cenibra is currently valued at an estimated US$500 to
US$600 million. As part of its policy to offload pulp and paper
assets to focus on its mining and transport interests, CVRD is
selling one of the four paper and pulp companies in which it
holds an interest. The other three companies are Bahia Sul,
Celmar and Floresta Rio Doce. CVRD announced late last month that
it was selling its stake in Bahia Sul to Suzano de Papel e
Celulose for US$320 million.



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

EDELNOR: Year-End Results, Monetary Correction Quadruples Loss
--------------------------------------------------------------
Empresa Electrica del Norte Grande S.A. (EDELNOR) reported a loss
of Ch$8.0 billion through year-end 2000, compared to a loss of
Ch$2.0 billion for the same period of 1999. Results were
negatively impacted by a non-cash monetary correction adjustment
(price level restatement) required under Chilean accounting rules
in the amount of Ch$6.6 billion.

(Had EDELNOR reported its results in U.S. dollars using U.S.
accounting rules rather than Chilean rules, net income would have
been US$1.4 million for the period compared to US$17.5 million
for the same period in 1999).

Revenues through year-end 2000 decreased 10.9 percent to Ch$60.1
billion, compared with Ch$67.4 billion for the same period in
1999, and sales decreased 1.8 percent from 2,435 GWh to 2,391
GWh.

The company's operating income decreased to Ch$0.3 billion,
compared with Ch$15.8 billion for the same period of 1999.
Operating income was affected primarily by increased fuel costs
due to gas consumption and gas transportation costs associated
with the operation of Mejillones III, and higher purchased power.
Earnings through year-end 2000 benefited from the recognition of
other income of Ch$6.8 billion related to business interruption
insurance proceeds for coverage of the outage at the company's
Mejillones II generating unit in late 1998 and early 1999.

EDELNOR has three main central generating units located in the
town of Mejillones in addition to several smaller diesel and
hydro facilities in the first and second regions of Northern
Chile. The company's Mejillones I unit is a coal-fired facility
with a maximum capacity of 166 megawatts and through year-end,
the unit operated with 83.1 percent equivalent availability and a
42.9 percent capacity factor. The company's Mejillones II unit is
a coal- fired facility with a maximum capacity of 175 megawatts
which operated with 91.7 percent equivalent availability and a
65.2 percent capacity factor for the period. The company's
Mejillones III unit, which began commercial operation on June 17,
2000, is a gas-fired combined cycle facility with a maximum
capacity of 250 megawatts. This unit operated with 76.2 percent
equivalent availability and a 47.8 percent capacity factor from
June 17 to December 31. During 2000, all of the units in the
Interconnected System of the Great North (SING) were limited to
an output of 180 megawatts.

EDELNOR owns 21.1 percent of Gasoducto Nor Andino, a natural gas
pipeline company which brings gas to northern Chile from
Argentina.

EDELNOR will conduct a conference call for its investors at 10
a.m. EST on Wednesday, March 7, to discuss EDELNOR's year-end
results and provide a general business update on EDELNOR.
Investors, media and the public may listen to a live broadcast of
the EDELNOR conference call on the Internet at www.mirant.com .

EDELNOR is 82 percent owned by Mirant, formerly known as Southern
Energy. The remainder is traded on the Chilean stock exchange.

Formerly known as Southern Energy, Mirant is a global competitive
energy company with leading energy marketing and risk-management
expertise. With an integrated business model, Mirant develops,
constructs, owns and operates power plants and sells wholesale
electricity, gas and other energy-related commodity products. The
company has extensive operations in North America, Europe and
Asia. Mirant owns or controls more than 20,000 megawatts of
electric generating capacity around the world, including more
than 14,000 megawatts in the United States, with another 9,000
megawatts under development. Mirant is 80 percent owned by
Southern Company.



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E C U A D O R
=============

EMELEC: PricewaterhouseCoopers Signs Contract With Conelec
----------------------------------------------------------
The Ecuadorian electric power council Conelec signed a contract
with the consortium teaming PricewaterhouseCoopers - BBVA, Levin
Interdin & Ahead to evaluate the assets of the electric utility
Empresa Electrica del Ecuador (Emelec), a report in the South
American Business Information suggested Monday. Part of the
consortium's task is to model the tender for the concession of
the electric distribution service in Guayaquil.

Conelec, which manages Emelec, reportedly planned to start
auditing electric companies in April as the first step toward
opening the market process.



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

BUFETE INDUSTRIAL: Bolanos Confirms Buying Struggling Firm
----------------------------------------------------------
Sergio Bolanos Quesada, of Mexico's Corporacion Serbo, made it
clear that he is doing more than just thinking about buying
Bufete Industrial. Bolanos is actually buying the struggling
Mexican construction company, Reforma/Infolatina reported Monday.
Bolanos revealed the terms of the acquisition have been
finalized, however, according to him, the transaction won't be
carried out unless the on-going pre-acquisition audit is
completed. Following the deal, Bolanos will take on restructuring
of the company's liabilities. Bolanos anticipates lifting the
current suspension of the company's payments in May or June.
Bolanos said his imminent acquisition of Bufete is motivated
solely by benefits it is expected to generate for the
construction of Serbo's 1-billion-dollar petrochemicals project
in Altamira, in northeastern Mexico.


CINTRA: Looming Sale Not Part Of Airline Industry Policy
--------------------------------------------------------
The imminent breakup and sale of Cintra, the state-owned Mexican
airline holding company, is not part of an airline industry
policy adopted by the administration of President Vicente Fox.
Pedro Cerisola, Communications and Transport Minister, made the
announcement in an Infolatina report Monday edition. According to
Cerisola, the decision to sell the holding company is IPAB's
responsibility and part of its process to redeem assets in an
optimal fashion.

"Were Cintra not sold, we'd all be stuck with its (IPAB's)
liabilities," Cerisola said, explaining that the ruling of the
Federal Competition Commission (CFC) last year to breakup and
sell Cintra was in the interests of the consumers.


PEMEX: Will Not Be Listed On Exchange Any Time Soon
---------------------------------------------------
Mexican state-owned energy conglomerate Petroleos Mexicanos
(Pemex) will not be listed on the Mexican Stock Exchange or any
other bourse in the near future, according to Mexican Energy
Minister Ernesto Martens in a South American Business Information
report released Monday. Martens says such move is currently
impossible due to a lack of free-trading shares to facilitate an
adequate float. Pemex is state-owned but the Mexican oil and gas
sectors are set to liberalize considerably in the coming months.
The administration of President Vicente Fox has signaled that it
intends to open up areas of the petrochemicals industry currently
controlled by Mexico to private enterprise. Martens said that
issuing shares in a company such as Pemex will likely contribute
to improving its performance and boosting its growth.


XEROX CORPORATION: Schiffrin, Barroway Joins The Fray Of Suits
--------------------------------------------------------------
The following statement was issued today by the law firm of
Schiffrin & Barroway, LLP:

Notice is hereby given that a class action lawsuit was filed in
the United States District Court for the District of Connecticut
on behalf of all purchasers of the common stock of Xerox
Corporation (NYSE: XRX) from February 15, 1998 through February
6, 2001, inclusive (the "Class Period").

The complaint charges Xerox and certain of its officers and
directors with issuing false and misleading statements concerning
the Company's financial condition. Specifically, the complaint
alleges that defendants failed to comply with its standard
accounting practices, including improperly recognizing revenues
from its leasing operations, which caused Xerox to issue false
and misleading financial statements during the Class Period.

Plaintiff seeks to recover damages on behalf of class members and
is represented by the law firm of Schiffrin & Barroway, LLP, who
has significant experience and expertise prosecuting class
actions on behalf of investors and shareholders.



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P E R U
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AUSTRAL GROUP: To Penetrate Three More Markets
----------------------------------------------
Austral Group SA fishery announced this year's addition of the
Mexican, Argentinean and Panamanian markets to its list of
countries the company already caters to, South American Business
Information reported Monday. According to Austral, it will sell
canned fish, fish meals and fish oil to the new countries. This
year, the group had overall exports of 2.1 million boxes of
canned fish worth US$35 million, and if the fishing season proves
to be good, plans are to increase the figure by 30 percent.

So far, Austral's selling has concentrated in Chile, Colombia,
and Bolivia. The company also markets in Europe and Asia.



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

LOQUESA.COM: To Implement Restructuring Plan
--------------------------------------------
Struggling to remain in business, the youth Internet site
Loquesea.com is implementing a restructuring plan, which could
see 70 employees in Venezuela losing their jobs, South American
Business Information related Monday. In addition, marketing
specialists would be taken on to improve global sales.

Loquesea.com, which operates in 19 countries, last year carried
out two rounds of capitalization, the first raising US$3 million,
the second led by Merrill Lynch. The company was then looking to
form alliances with other operations to create specialized joint
sites. At the end of 2000, the site was valued at US$40 million.




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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