TCRLA_Public/010315.mbx        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

            Thursday, March 15, 2001, Vol. 2, Issue 52

                           Headlines


B A R B A D O S

QEH: Government To Inject Bds$100M For Queen E. Hospital


B O L I V I A

EL MUTUN: Sidertur Wants To Revive With Pig Iron Factory


B R A Z I L

BMD: Still No Decision From FGC On CB Liquidation Proposal
CVRD: To Formally End Cross-Ownership With CSN On March 15


M E X I C O

BUFETE: Creditor Banks Not Informed About Forthcoming Sale
CINTRA: Fox Administration Studies Cap On Foreign Ownership
GRUPO VITRO: Shares Drop On Concerns Over Debt Obligations
GRUPO AZUCARERO: Sugar Price Drop Is Sour Note For Producers
ICA: Successfully Issues 180-Million-Peso CPOs
LUZ & FUERZA: To Review Consumption Of Leading Clients
SERFIN: Unlikely To Be Paid For $250 Million Claim


P A R A G U A Y

ANTELCO: May Cut Over Half Of Workforce To Stem Losses
BNF: Technically Bankrupt, Liquidation Likely
PETROPAR: Likely To Become A Regulating Agency


P E R U

NBK: Offered Buyback Scheme To Shareholders Before Intervention


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

QEH: Government To Inject Bds$100M For Queen E. Hospital
--------------------------------------------------------
Prime Minister Owen Arthur says the Barbados government intends
to invest over Bds$100 million in the beleaguered, state-run
Queen Elizabeth Hospital (QEH), Caribbean News Agency reported
Tuesday. Arthur, the island's finance minister, announced that
the government has allocated an estimated a Bds$102.1 million
(US$51.5 million) for the country's major health institution. The
600-bed health care facility has generated much debate in recent
years because of management problems and deteriorating
conditions.



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B O L I V I A
=============

EL MUTUN: Sidertur Wants To Revive With Pig Iron Factory
--------------------------------------------------------
Brazilian steelmaker Sidertur proposed installing a 300,000tpy
pig iron factory at the dormant state-owned El Mutun iron ore
mine and steel complex, Business News Americas reported Tuesday.
According to Santa Cruz mining chief Jose Padilla, the provincial
authorities in the eastern Bolivian city of Santa Cruz have
already confirmed receipt of Sidertur's proposal.

"As promoter (of the Mutun project), Santa Cruz is responsible
for passing the proposal on to (state mining company) Comibol and
to the central government," he said. As part of a plan to provide
logistical support to attract investors to Mutun, which the
government is trying to revive, a report into environmental
aspects of the Pailon-Puerto Suarez highway is due to be
completed by the end of March.

"We are also thinking of making a presentation to create a
'Mercosur' within El Mutun, opening up the deposit so it becomes
of mutual service to Mercosur countries. This would generate an
open market," Padilla said.

Comibol, meanwhile, admitted it has not made progress toward
privatizing El Mutun. The process of selecting an investment bank
for an auction to sell the complex off has not been completed.



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

BMD: Still No Decision From FGC On CB Liquidation Proposal
----------------------------------------------------------
FGC (Fundo Garantidor de Creditos) has not yet rendered a
decision to the Brazilian Central Bank on a liquidation proposal
for Banco Mercantil de Descontos (BMD), reported South American
Business Information Tuesday. The deal, which was outlined by FGC
and was accepted by creditors, stated that the controlling
companies of BMD had to raise R$50 million so that the bank's
liquidation would be handled by FGC instead of the Central Bank.

The first step of the process would be distribution of the bank's
R$123 million in cash to creditors. Next, FGC would sell to
private banks the rest of BMD: authorization for 33 branches,
clients files and tax credit of R$180 million. FGC is BMD's
largest creditor, holding R$92 million in debt.


CVRD: To Formally End Cross-Ownership With CSN On March 15
----------------------------------------------------------
Rio de Janeiro-based CSN (steel) and CVRD (mining-transport)
remain on target for the planned Thursday (Mar.15) to formally
untangle cross-ownership, according to CSN spokesperson Gustavo
Lima in a BNamericas.com Tuesday report. The complex US$1bn-plus
operation, involving 16 primary parties, is seen vital for the
development of both companies. The dismantling of the ownership
agreement should allow them to concentrate on their respective
core businesses and attract foreign financing. The crossover is a
legacy of CVRD's 1997 privatization.



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

BUFETE: Creditor Banks Not Informed About Forthcoming Sale
----------------------------------------------------------
Sale negotiations between struggling Mexican engineering and
construction firm Bufete Industrial and Corporacion Serbo are
still not completed, Reforma/Infolatina related Tuesday.
According to reports, Bufete's creditor banks, including Citibank
Mexico and Banca Serfin, don't have adequate knowledge about the
impending transaction, wherein Serbo Chairman Sergio Bolanos is
to acquire the debt-laden firm.

Along with IXE Grupo Financiero and Santander Mexicano, Citibank
and Serfin are owed approximately 80 million dollars of Bufete's
estimated 400 million dollars in liabilities.


CINTRA: Fox Administration Studies Cap On Foreign Ownership
-----------------------------------------------------------
With the forthcoming sale of state-owned Mexican airline holding
company Cintra, President Vicente Fox's administration is
reviewing Mexico's 25-percent cap on direct foreign ownership of
the country's carriers, according to Reforma/Infolatina report
Tuesday edition. The administration could choose to relax the
existing maximum limit on direct foreign ownership in a bid to
stimulate more-effective competition in the Mexican airline
industry. Report has it that Mexican Communications and Transport
Minister, Pedro Cerisola, is also considering implementing an
open-skies policy in Mexico, at least with respect to U.S.
carriers.


GRUPO VITRO: Shares Drop On Concerns Over Debt Obligations
----------------------------------------------------------
Grupo Vitro SA shares fell 8.4 percent, their steepest one-day
decline in almost three months, amid growing concerns over the
glassmaker's ability to refinance its debt this year and next,
analysts said in a Bloomberg report published Tuesday. Shares
fell 0.93 peso to 10.2 pesos ($1.06). Vitro shares are still up
54 percent from a three-month low of 6.6 pesos reached Dec. 28.
Vitro's American depositary receipts fell 4 cents, or 1.3
percent, to $3.10. The company, currently valued at around $300
million, needs to refinance $430 million of debt this year and
$520 million in 2002. Some analysts suspect the company won't be
able to refinance their debt. Robert McKinnon, a Salomon Smith
Barney analyst in New York, rates the stock "underperform."
Primary concerns are that refininancing could curb profit growth
and the any slowdown in the Mexican economy would further strain
finances. However, Albert Chico, Vitro's corporate communications
manager, expressed confidence that the company will be able to
pay its obligations.


GRUPO AZUCARERO: Sugar Price Drop Is Sour Note For Producers
------------------------------------------------------------
The 20-percent price drop - from 250 pesos to 200 pesos for 50
kgs of sugar - in the last three weeks didn't help matters at
Mexican sugar group GAM (Grupo Azucarero Mexicano), South
American Business Information said Tuesday. GAM, which has been
in temporary receivership for a year now, believes that the whole
sector is in a critical position. The sugar harvest in 2001
should produce a surplus of around 550,000 tons (above the 4
million tons the Mexican domestic market can consume) and thus it
is vital that trade is established with the US over and above the
116,000 tons limit currently in place. Grupo Azucarero Mexicano
currently has liabilities of US$125.9 million.


ICA: Successfully Issues 180-Million-Peso CPOs
----------------------------------------------
Mexican construction company ICA announced that it had issued 180
million pesos in amortizable CPOs on the company's right to
collect vehicle tolls at the Acapulco Tunnel, Infolatina reported
Tuesday. Consequently, ICA can now restructure its 16-million-
dollar short-term debt to a term of 15 years. The success of the
issue, which was handled by BBVA Bancomer, indicates the market
may believe in ICA's ability to meet its estimated $751 million
obligations.


LUZ & FUERZA: To Review Consumption Of Leading Clients
------------------------------------------------------
State-owned power utility Luz & Fuerza del Centro (L&FC) said in
a South American Business Information report released Tuesday
that it will be reviewing power consumption of its top 10,000
customers to elude more losses. The announcement came after the
company reported it has been losing 1 billion pesos annually due
to electricity theft committed by companies working without
contracts. L&FC, according to previous reports, has been in the
red since 1994 despite federal subsidies aimed at buoying the
company. The company is implementing new strategies intended to
improve service quality and eliminate corruption amongst workers.


SERFIN: Unlikely To Be Paid For $250 Million Claim
--------------------------------------------------
Mexican bank bailout agency IPAB believes that Grupo Financiero
Santander Mexicano's (Santander) attempts to have the agency pay
a $250 million refund the Spanish-owned group will be
unsuccessful.  Santander claims it is owed the money on account
of its May 2000 acquisition of government-intervened Grupo
Financiero Serfin. In an Infolatina Tuesday edition, an IPAB
source expressed confidence that the ruling, expected in several
weeks' time, will not favor the Santander.

Several months ago, Santander presented IPAB with a $250 million
dollar claim, saying it had discovered hidden liabilities in
Serfin's books.



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P A R A G U A Y
===============

ANTELCO: May Cut Over Half Of Workforce To Stem Losses
------------------------------------------------------
Paraguayan state operator Antelco, which is under government
intervention, emphasized the need to reduce its current 5,186
workers to 2,000 due to a report on its bad performance, South
American Business Information said Tuesday. The company has
initially dismissed 1,500 redundant employees. Antelco is saddled
with debts of more than US$110 million (Gs$415,849mil).
Liabilities must be settled before the company can be sold off to
a private investor. Antelco still has receivable bills of
Gs$130,000mil with the government.


BNF: Technically Bankrupt, Liquidation Likely
--------------------------------------------
A proposal, outlined by the Japanese economic cooperation agency
JICA, the BID, and the Planning Secretariat, could see the
closure of Banco Nacional de Fomento (BNF), South American
Business Information said Tuesday. BNF is considered to be
technically bankrupt, with annual losses of US$12 million since
1998. Upon liquidation, its portfolio of agricultural loans would
be passed on to Credito Agricola de Habilitacion, and the
portfolio of small & medium corporations to the private banks.
The liquidation of BNF is estimated to cost US$80-$100million.


PETROPAR: Likely To Become A Regulating Agency
----------------------------------------------
Paraguayan president Gonzalez Macchi is considering an economic
package that could turn oil company Petroprar into a regulating
agency. The company would disengage from the production and
distribution of hydrocarbons & derivatives, South American
Business Information reported Tuesday. The proposal was
reportedly outlined by the Japanese economic cooperation agency
JICA, the BID, and the Planning Secretariat. Petropar, rumored to
be on the brink of bankruptcy last November, is one of the many
non-competitive state owned companies that pays high freights and
no transparency in its management practices.



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P E R U
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NBK: Offered Buyback Scheme To Shareholders Before Intervention
---------------------------------------------------------------
Peruvian bank NBK, before it was intervened by the
Superintendence last December 11, attempted to favor its
shareholders via a scheme to buyback its shares at inflated
prices on the Lima stock exchange, Business News Americas
reported Tuesday. The buyback program, which never received
Banking Superintendence approval, would have reduced the bank's
capital by around 5.7 percent. NBK tried to buy back 13.96
million shares at a price of one sol per share each at a time
when they were trading at around 0.52 soles per share.

As of Nov. 30, NBK had assets of 2.04 billion soles ($583
million) and deposits of 840 million soles. It wasn't able to
meet its obligations after clients withdrew deposits in mid-
December on speculation that it faced a cash shortage after
former President Alberto Fujimori's government collapsed in
November.




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.

This material is copyrighted and any commercial use, resale or
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Information contained herein is obtained from sources believed to
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