TCRLA_Public/010808.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

            Wednesday, August 8, 2001, Vol. 2, Issue 154

                           Headlines



A R G E N T I N A

AEROLINEAS ARGENTINAS: Sale To Close Inside Of Two Weeks
AEROLINEAS ARGENTINAS: SEPI Accepts Argentinean Group's Offer


B R A Z I L

CELESC: Aneel Grants Rate Increases To Stem Defaults
GLOBO CABO: Sees Reduction In Number Of Subscribers
MASTER ADMINISTRADORA/UNIAO EMPREENDIMENTOS/MARLIN: Liquidating
TELEMAR: Market Analysts Endorse Telerj Shares
VARIG: S&P Places RG Receivables Co. Ltd. Notes On Watch Negative


C H I L E

EDELNOR: Addressing Liquidity Issues As Mirant Seeks Assurances
EDELNOR: AES Offers To Purchase US$340M Sr. Loan Certificates
EDELNOR: S&P Lowers Ratings to 'CC'; Still on Watch


C O L O M B I A

AVIANCA: Projected Merger With Aces Now In Ministry's Hands


M E X I C O

BANCRECER: IPAB Investigating ING's, Sabadell's Earlier Moves
ELAMEX: 2Q01 Results; Sales Down And Joint Venture Losses
GRUPO SIDEK: Asset Sales Report For July 1, To July 31, 2001


N I C A R A G U A

BANIC: Regulator Takes Over, Sells Bank


V E N E Z U E L A

TELSCAPE: Update On ATSI's Acquisition Teleport Assets


     - - - - - - - - - -

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A R G E N T I N A
=================

AEROLINEAS ARGENTINAS: Sale To Close Inside Of Two Weeks
--------------------------------------------------------
Labor Minister Patricia Bullrich informed that the sale of
Sociedad Estatal de Participaciones Industriales unit Aerolineas
Argentinas will close within the next 10 days, AFX-Asia reported
Monday. According to Bullrich, the Spanish state holding company
SEPI and Infrastructure Minister Carlos Bastos will make final
decisions this week or next based on the bids already submitted.


AEROLINEAS ARGENTINAS: SEPI Accepts Argentinean Group's Offer
-------------------------------------------------------------
Alicia Castro, national deputy for the ruling social-democrat
Alliance and leader of the cabin-attendants union, revealed SEPI
has accepted an offer submitted by an Argentinean group to buy
the ailing carrier, Aerolineas Argentinas, AFX-Asia said Monday
in a report. Former Aerolineas Chief Executive Juan Carlos
Pellegrini, who met with union representatives on Saturday,
reportedly included in his offer a possible strategic alliance
with Singapore Airlines Ltd. for the Pacific routes and an
agreement with Iberia, Lineas Aereas de Espana SA.

According to reports, Pellegrini does not plan to lay off staff.
In fact, employees would receive 20 percent of Aerolineas' equity
under the terms of the agreement.

Early indications are that the US$600-million debt of Aerolineas,
excluding US$332 million arising from leasing contracts, would be
assumed by SEPI. Moreover, SEPI would grant a $100 million
credit. Pellegrini's plan also includes an agreement with Airbus
Industrie and Boeing Co to upgrade Aerolineas' fleet and provide
more cost-efficient aircraft.



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

CELESC: Aneel Grants Rate Increases To Stem Defaults
----------------------------------------------------
Brazil's energy regulator Aneel granted Centrais Eletricas de
Santa Catarina SA (Celesc) rate increases effective August 7 to
adjust for rising electricity purchase costs stemming from a
weaker currency, Bloomberg revealed Monday. The Santa Catarina
state-based utility, which defaulted on a $61.2-million debt due
June 14, 2001, will be allowed to increase its rates by up to
20.7 percent on Tuesday.

Aneel grants power distributors annual rate adjustments based on
power purchase costs and on inflation over the past 12 months, as
measured by Brazil's IGP-M index from the Getulio Vargas
Foundation.


GLOBO CABO: Sees Reduction In Number Of Subscribers
---------------------------------------------------
Due to the economic slow-down, around 20.1 percent of Globo
Cabo's subscribers cancelled the service during the second
quarter of this year, following a 16.5 percent drop reported in
the first quarter 2001, Gazeta Mercantil said Monday. Globo
Cabo's overall customer base dropped from 1.524 million to 1.493
million people. Early this year, the leading Brazilian paid TV
network intended to expand its customer base at 12 percent but in
May it revised the projection downward to 9 percent.

The company recently predicted that its EBITDA would be 15
percent lower than the market expectations of US$180 million.
However, consensus among market analysts is for results between
US$127 million and US$133 million.


MASTER ADMINISTRADORA/UNIAO EMPREENDIMENTOS/MARLIN: Liquidating
---------------------------------------------------------------
Banco Central ordered the liquidation of the broker and consortia
Master Administradora de Consorcio S/C, Uniao Empreendimentos e
Administracao S/C, and Marlin, Gazeta Mercantil disclosed in a
report Monday. According to Ms. Teresa Grossi from Banco Central,
the companies showed management irregularities and don't have net
worth to support their operations. Uniao Empreendimentos, which
is controlled by Santo Andre Participacoes, has a negative net
worth of R$5.25 million. Marlin, on the other hand, only has a
net worth of R$2 million, not enough to meet its commitments.


TELEMAR: Market Analysts Endorse Telerj Shares
----------------------------------------------
Market analysts say that, with the restructuring of Telemar,
Telerj is a positive position for those who still hold or are
aquiring the company's shares, according to an O Globo report
released Monday. Telemar shareholders recently approved the take
over of 15 telecoms carriers by Telerj. The shareholders of these
15 companies will get a bonus of 12 percent to swap their shares
for Telerj shares (to be named Telemar Norte Leste).


VARIG: S&P Places RG Receivables Co. Ltd. Notes On Watch Negative
-----------------------------------------------------------------
Standard & Poor's on Monday placed its single-'B'-plus rating on
RG Receivables Co. Ltd.'s $100 million 9.6% credit card-backed
notes on CreditWatch with negative implications.

The negative CreditWatch placement follows the disclosure that
the underlying generator of the transaction's assets, Viacao
Aerea Rio-Grandense S.A. (Varig), breached an interest coverage
covenant in the first quarter of 2001 that could lead to an early
amortization of the transaction's outstanding balance. In
addition, Varig's financial performance in the first several
months of 2001 deteriorated as a result of the more difficult
operating conditions in Brazil this year, with further adverse
results expected in the second half of 2001.

Varig's performance has been hurt by a drop in both domestic and
international air travel in Brazil this year, as well as a
significant decline in the local currency and higher interest
rates and jet fuel costs. Although the company is attempting to
cut costs, results beyond those already realized in a similar
restructuring effort in 1999 may be difficult to achieve. Varig's
management has completed a refinancing of some short-term debt
and may derive some additional relief from the sale of a stake in
its cargo transport business, but financial flexibility
nonetheless remains limited.

The RG Receivables notes are secured by the proceeds of credit
and charge card receivables generated by the sale of airline
tickets in the U.S. to Varig customers flying between Brazil and
the U.S. The transaction is structured to capture offshore U.S.
dollar-denominated payments generated from the sale of tickets on
Varig flights between Brazil and the U.S. and between the U.S.
and Tokyo, Japan.

To date, the transaction has performed well despite a challenging
operating environment in Brazil at various times over the past
three years. Cash flow coverage currently remains in excess of
three times quarterly debt service, and Varig has not yet
attempted to reduce the frequency of flights between Brazil and
the U.S.-routes that are critical to the generation of foreign
charge card receipts. Moreover, the transaction performed as
designed in 1999 despite similar financial pressures and a broad
restructuring of Varig's debt undertaken at that time with the
company's other creditors.

Nevertheless, the CreditWatch placement reflects uncertainty
surrounding the near-term actions of investors who, given the
interest coverage covenant breach, currently have the right to
accelerate the amortization of the transaction notes. In
addition, Standard & Poor's remains concerned that the economic
outlook in Brazil over the remainder of 2001 remains challenging
and could lead Varig's management to reduce flight frequencies to
the U.S., thus, negatively impacting the transaction. Standard &
Poor's has also noted that an early amortization of the RG
Receivables notes-whether triggered by the interest coverage
covenant or some other transaction covenant-could have a
significant negative impact on Varig's liquidity and,
consequently, its overall credit profile to which the transaction
rating is directly tied. Standard & Poor's believes that the
transaction rating could come under near-term downward pressure
from either investor actions that accelerate the transaction's
amortization or from a prolonged economic slowdown in Brazil that
further impairs Varig's financial health.



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

EDELNOR: Addressing Liquidity Issues As Mirant Seeks Assurances
---------------------------------------------------------------
Empresa Electrica del Norte Grande S.A. (EDELNOR) was informed by
its majority shareholder that, concurrent with its second quarter
after-tax charge of US$ 57 million, Mirant Corporation does not
intend to make additional cash infusions into the Company unless
it can be assured that it will be repaid in the near term.  
Mirant has agreed, however, to defer repayment of certain past
due amounts of more than $2 million owed to it by EDELNOR as a
way to mitigate EDELNOR's on-going liquidity problems.  
Additionally, Mirant has stated that at the present time it is
difficult to envision receiving such assurances of repayment in
the absence of an advanced sales agreement for the company.

EDELNOR completed the sale of an office building in Antofagasta
in June for approximately US$1.7 million.  Discussions have also
been held regarding the sale of certain sub-transmission assets
in the cities of Arica and Iquique.  However, these discussions
are not progressing and it is uncertain whether alternative
buyers can be identified in the near term.

Additionally, EDELNOR has requested authority from the Comision
Nacional de Energia (CNE) to remove from service certain diesel
generators that, along with other equipment, occupy land adjacent
to the Pacific shoreline in Antofagasta.  Once this removal is
authorized, EDELNOR plans to solicit offers for this property.  
However, due to certain related contracts that do not expire
until December 31, 2001, it is unlikely that a final closing on
this property will take place before first quarter of calendar
year 2002.

These developments place additional pressure on EDELNOR's cash
liquidity situation.  Cash flow is being managed carefully and
such efforts will be extremely important going forward.  At this
time, EDELNOR believes that it should, in the near term, be able
to manage the timing of receipts and disbursements to enable it
to meet its financial obligations when due, through and including
the September 15th loan interest payment.  However, no assurance
can be given that it will be able to do so.

Without a financial restructuring, it is anticipated that
liquidity will continue to be a difficult and on-going problem.


EDELNOR: AES Offers To Purchase US$340M Sr. Loan Certificates
-------------------------------------------------------------
The AES Corporation (NYSE:AES) announced Monday that Luna III,
Ltd., a Cayman Islands limited liability exempted company
("Luna") and wholly owned indirect subsidiary of The AES
Corporation has commenced a tender offer (the "Offer") for cash
to purchase all of the outstanding (i) 10-1/2% Senior Loan
Participation Certificates due 2005 (the "2005 Certificates") and
(ii) 7-3/4% Senior Loan Participation Certificates due 2006 (the
"2006 Certificates" and, together with the 2005 Certificates, the
"Certificates") of Empresa Electrica del Norte Grande S.A., a
Chilean corporation ("Edelnor"). The 2005 Certificates and the
2006 Certificates were issued in an aggregate principal amount of
US$90,000,000 and US$250,000,000, respectively. The Certificates
represent pro rata participation interests in all payments of
principal and interest made in respect of loans of Edelnor. The
purchase price to be paid for each US$1,000 principal amount of
Certificates tendered pursuant to the Offer will be $375.00 plus
accrued and unpaid interest up to, but excluding, the date of
payment.

The Offer will expire at 11:59 p.m. New York City time, on August
31, 2001, unless extended or earlier terminated.

The Offer is conditioned upon, among other things (1) there being
validly tendered and not withdrawn 100% of the outstanding
Certificates, (2) the acquisition (the "Acquisition") by Luna or
an affiliate of Luna not less than 82.3403% of all the
outstanding shares of Edelnor on a fully diluted basis currently
owned, directly or indirectly, by Mirant Corporation, a Delaware
corporation ("Mirant"), for a purchase price not exceeding $1,000
and the acquisition of the shares of Energia del Pacifico Ltda.,
a Chilean corporation owned by Mirant that are not held through
Edelnor, and (3) receipt of financing for the Offer on terms
satisfactory to Luna. Luna has not entered into any agreements
providing for the Acquisition.


EDELNOR: S&P Lowers Ratings to 'CC'; Still on Watch
---------------------------------------------------
Standard & Poor's on Monday lowered its senior unsecured debt and
corporate credit ratings on Empresa Electrica del Norte Grande
S.A. (Edelnor) to double-'C' from triple-'C'. The ratings remain
on CreditWatch with negative implications.

Edelnor generates and transmits electricity in the northern
interconnected system (SING), Chile's second largest electrical
grid. Mirant Corp. (triple-'B'-minus/Stable/'A-3'), owns 82% of
Edelnor. The downgrade follows Mirant's announcement that it does
not intend to make additional cash infusions into Edelnor unless
it can be reassured that it will be repaid in the near term.
Since Mirant also stated that it is difficult at the present time
to envision how it would receive such assurances of repayment in
the absence of an advanced sales agreement for Edelnor, Standard
& Poor's concludes that Mirant will withdraw a sizeable amount of
support for Edelnor. Mirant's action significantly increases
uncertainty over Edelnor's ability to make its upcoming debt
service payment in September 2001.

    The rating reflects:

    --  Worse-than-anticipated operating performance in 2000,
        resulting in coverage ratios below expectations;

    --  The anticipated loss of significant contract revenue from
        the Emel subsidiary, which expires at the end of 2001;

    --  Uncertainty about Edelnor's ability to keep and attain
        new sales contracts or sell into the spot market; and

    --  The entry of gas and gas-fired plants, which has created
        overcapacity in the SING grid.

Edelnor has only been able to meet its financial obligations
since the end of the first quarter of 2001 with the aid of a US$6
million fund set aside for Edelnor, and made available by its
Chilean parent, Mirant Chile S.A. The purpose of this fund was to
help Edelnor work through minor cash flow difficulties due to
timing. Mirant is not expected to continue to provide this
support, though Mirant has instructed Edelnor that it will defer
repayment of more than US$2 million owed to Mirant for services
previously provided in order to assist with Edelnor's liquidity
situation.

Nevertheless, without revenues from the Emel contracts after
2001, which account for roughly one-half of contracted capacity;
expected narrowing margins on sales of coal-powered energy; and
barring any additional aid from its parent, it is extremely
unlikely Edelnor will meet its scheduled interest payments in
March 2002. This assumes Edelnor wins definitive approval from
the national environmental regulator (CORAMA) to use pet coke, a
more efficient fuel, in its coal plants, which might enable the
coal plants to be dispatched more often. Even if Edelnor wins
definitive approval, which may take place in the third quarter of
2001, it will not have a material impact on Edelnor's ability to
meet its financial obligations in March 2002. Funds gathered from
Edelnor's sale of noncore assets are also not expected to be
sufficient to help meet its March 2002 debt service payments.

A further hindrance to Edelnor's cash flow difficulties in 2001
is the elimination of a US$30 million cash influx Edelnor was to
receive from a debt issuance to have taken place in 2000 at its
gas pipeline subsidiary, NorAndino. This financing did not take
place. The elimination of this expected cash influx is pivotal to
Edelnor's current cash flow crunch, and makes Edelnor even more
vulnerable, especially in 2002 after the loss of the Emel
contracts.

The loss of the Emel contracts coincides with the entry of lower
marginal cost, gas-fired facilities, which have doubled installed
capacity in the SING. Because most large customers have already
procured firm supply, there is little opportunity for Edelnor to
replace these customers in the SING.



===============
C O L O M B I A
===============

AVIANCA: Projected Merger With Aces Now In Ministry's Hands
-----------------------------------------------------------
Avianca's projected merger with fellow Colombian airline Aces has
been re-designed leaving the Colombian development ministry to
decide on whether to continue with the process, Portafolio
reported Monday. The ministry has ten days to decide on whether
to hand a new study back to the Superintendencia.

In June this year, the trade and commerce Superintendencia ruled
against a merger, but Aces and Avianca have opposed any judgment
by the Superintendencia due to certain public comments made by
Superintendente Emilio Archila, who may well be removed from the
investigation or even his post.

Meanwhile the two companies face increasing financial pressure
without consolidating resources.



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

BANCRECER: IPAB Investigating ING's, Sabadell's Earlier Moves
-------------------------------------------------------------
Mexican bank bailout agency IPAB is now looking into Netherlands-
based ING's and Spanish banking institution Sabadell's
participation in the initial stage of the sale process of the
defunct bank Bancrecer, Mexico City daily Reforma reported
Monday. ING and Sabadell expressed written interest prior to the
deadline for expressions of interest, only to deny any intentions
to participate on the final deadline day, leading to confusion as
to what institutions were really participating.

Meanwhile, IPAB is also investigating the actions of Deutsche
Bank, the institution contracted by IPAB to administer the bank's
auction.


ELAMEX: 2Q01 Results; Sales Down And Joint Venture Losses
---------------------------------------------------------
In a company press release, Elamex, S.A. de C.V. (Nasdaq:ELAM)
announced Monday its results for the quarter ended June 29, 2001.

Sales decreased 23% ($10.5 million) to $36.2 million from $46.7
million in the second quarter of the prior year. Net loss for the
quarter of $1.5 million compared to net income of $19.0 million
for the same quarter in 2000. Net loss per share for the second
quarter of 2001 was $0.22 per share, a decrease of $2.99 per
share compared to earnings per share of $2.77 for the same
quarter in the prior year. There were 6,866,100 outstanding
shares at the end of the second quarter for both 2000 and 2001.

The decrease in net sales was primarily the result of the sale of
our EMS operation in the second quarter of 2000, which accounted
for $9.8 million in sales in that same quarter. In addition, our
shelter operation sales increased $3.3 million and sales from our
joint venture with GE (Qualcore) decreased $4.3 million as the
result of the closing of the Juarez plant in the second quarter
of 2001.

Gross profit in the second quarter of 2001 fell to $137,000, down
from $1.3 million in the prior year, a reduction of $1.2 million.
The major contributors to this reduction were:

-- Our joint venture with GE generated a negative gross profit in
the second quarter of this year of $2.1 million compared to a
negative $927,000 in 2000, a decrease of $1.1 million. Of this
amount, $1 million was due to an increase in scrap because of
start up problems in many of the new machines, continued
production inefficiencies, costs associated with tooling repairs,
and an increase in reserves for inventory obsolescence.

-- Shelter operations recorded $658,000 less gross profit in the
second quarter of 2001 than in the same quarter of a year ago,
the result of significant losses from discontinued contracts, and
from lower margins throughout the division.

-- The EMS operation provided a negative gross profit of $432,000
in the second quarter of 2000, thus resulting in a favorable
variance of that same amount in 2001.

Operating expenses of $5.2 million in the second quarter of this
year increased by $400,000 over the $4.8 million of one year ago.
This net increase is primarily due to the following:

    -- Restructuring costs of $2.5 million recorded in the second
    quarter of 2001 associated with the closing of the Juarez
    plant, costs related to future lease obligations on idle
    property, and severance costs resulting from continued
    reductions in personnel.

    -- A reduction in operating expenses in 2001 of $2 million
    compared to 2000 resulting from the sale of EMS operations in
    the second quarter of 2000.

    -- During the second quarter of 2001 reserves for
    Uncollectable accounts increased by $393,000, primarily in
    our Kentucky operation.

    -- A reduction in personnel related expenses in 2001 of
    $441,000 compared to the same quarter in 2000.

Other income of $397,000 in the second quarter of 2001 was $20.4
million less than the $20.8 million recorded in the same quarter
of last year, primarily due to the $20.5 million gain on the sale
of EMS operations in the second quarter of 2000.

The tax liability for the quarter is based on our calculation of
the tax liability for the complete year. Factors affecting this
liability include Company results, year end exchange rates and
projections for inflation. Based on the second quarter operating
results, the Company estimates a tax credit of approximately $1.3
million.

Richard P. Spencer, President and CEO of Elamex, made the
following comments regarding the second quarter results:

"Elamex's financial results for the second quarter 2001 reflect
our business plan to bring ongoing expenses in line with revenues
and streamline our business structure. The steps taken to date
are beginning to show positive financial results. The 2001 second
quarter consolidated income before taxes and minority interest
adjusted for depreciation, amortization and net interest expense
(EBITDA), which includes the consolidation of minority interest
of $1.9 million, shows a negative EBITDA of approximately $3.3
million compared to a negative EBITDA of approximately $10.8
million in the first quarter 2001. Excluding adjustments for
severance, plant closures, asset reductions and other writedowns,
the adjusted consolidated EBITDA for the second quarter was
approximately $484,000 compared to $115,000 in the first quarter,
an improvement of $369,000. We anticipate continued measurable
improvement in the second half of 2001."

"In Elamex's first quarter earnings announcement, we indicated
that the second quarter 2001 results would be negatively impacted
from additional non-recurring expenses associated with
repositioning ongoing business operations. The non-recurring
charges taken in the second quarter associated with these
initiatives were $2.5 million. Of this amount, $1.3 million was
the result of the closure of the Juarez plant in our joint
venture, $740,000 was associated with the remaining contracted
rent from a vacant leased building and an additional $441,000 in
severance costs resulting from continued reductions in personnel.
Since the beginning of the year, we have reduced our
administrative personnel in our wholly owned subsidiaries and
corporate staff by 15% and by year end we project this reduction
to be approximately 36%. All of the reductions have not just come
from lower level positions. We have reduced our corporate staff
from forty-one to fourteen, a 65% reduction, and we anticipate
further reductions in this area. We believe that we have now
substantially recognized the bulk of the excess overhead expenses
associated with our business operations."

"We still face significant challenges in our business units to
reach acceptable financial performance levels on an ongoing
basis. Our shelter business is stable but growth is being
impacted by the uncertainty of the U.S. economy. As a result,
U.S. companies are generally delaying decisions regarding plant
expansions or movement of production facilities to Mexico. We do
not expect our shelter operations to show significant growth
until the U.S. economy shows clear signs of recovery."

"While the Kentucky operation has been able to maintain its
revenue base, extreme competitive pricing pressures and plant
efficiency issues have negatively impacted operating results.
Since our Kentucky operation primarily sells to the appliance and
automotive sectors, we anticipate ongoing pricing pressures while
we work on improving plant efficiencies."

"With respect to our joint venture plastics molding and metal
stamping business with General Electric de Mexico, the Juarez
facility has been closed on time and at a cost lower than
anticipated. We continue to face with ramp-up issues at the new
plant in Celaya, Mexico. We do not anticipate that this plant
will reach break even operations until the fourth quarter."

"Besides taking steps to improve our expense base and balance
sheet, we have also been in the process of defining our future
business model and strategy. We will primarily focus on
investment opportunities where Elamex can leverage its expertise
in the shelter business, while looking to our future partners to
bring manufacturing and marketing expertise."

Consistent with this strategy, the Elamex Board of Directors has
approved a $3.0 million convertible subordinated loan to Franklin
Connections LLC., a related party. If converted, this investment
will represent approximately 17.3% ownership in the company.
Franklin Connections has recently built a new 55-60 million pound
candy manufacturing facility in Juarez, Mexico. Candy production
from this plant is for export to the United States. Individuals
in the Franklin Connections senior management team have held
senior executive positions in major U.S. candy companies, such as
Mars Inc., E.J. Broch and Farley Candy Company. Elamex has an
existing shelter contract for the local labor and related
services associated with this new plant.

Elamex is a Mexican manufacturer service provider. The Company,
in addition to production of plastic and stamped metal
components, delivers high quality finished assemblies to U.S. and
Canadian Original Equipment Manufacturers (OEM) in the consumer,
telecommunications, industrial, medical and automotive
industries. Elamex participates in a high growth industry, where
its unique competitive advantage results from its demonstrated
capability to leverage low cost, highly productive labor,
strategic North American locations, recognized world class
quality, and proven ability to combine high technology with labor
intensive manufacturing processes.


GRUPO SIDEK: Asset Sales Report For July 1, To July 31, 2001
------------------------------------------------------------
Grupo Sidek, S.A. de C.V. (OTC Bulletin Board: GPSAY GPSBY)
announced Monday a report regarding assets sales from July 1,
2001 to July 31, 2001, pursuant to its obligations under the
restructuring agreements entered into with Sidek Creditor Trust.

                               ASSETS SALES REPORT
                        From July 1, 2001 to July 31, 2001
                            (Figures in US$ thousands)

    Assets with Reorganization
     Value higher than
     USD$ 5,000               Sales Value    Reorganization Value
    I. Hotels                       3,227                   1,851
    II. Real Estate                     0                       0
    III. Marinas and Golfs              0                       0
    IV. Other                           0                       0
    Subtotal                        3,227                   1,851

    Assets with
    Reorganization Value
     Less than USD$ 5,000

    Subtotal (transactions)         3,373                    N.A.

    Total                           6,600                    N.A.



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

BANIC: Regulator Takes Over, Sells Bank
---------------------------------------
Nicaragua's bank regulator took over Banco Nicaraguense de
Industria and Comercio (Banic) on Saturday and auctioned it on
Sunday, making way for the release of delayed international
loans, Financial Times reported Tuesday. The expedited process
was aimed at restoring public confidence in the country's fragile
financial system.

Banic is the eighth bank to have been forcibly taken over or
failed since 1995. Diplomats said Banic's problems were putting
together a temporary deal with the International Monetary Fund,
on which US$35 million in loans from the Inter-American
Development Bank (IADB) depends. The deal could also lead to
extra provisional relief for US$6.3 million of Nicaragua's debt
under the Highly Indebted Poor Countries' Initiative.

Banic, privatized in 1999 but still 32 percent state-owned, had
lost 820 million cordobas (US$61 million) in deposits, more than
a third of the total, in the last nine months. Its four private
shareholders, Hamilton Bank of the US, Banco de Comercio of
Guatemala and Panama's Banco Aliado and Panabank failed to agree
with the government on the capital injection required. Banco de
la Produccion, Nicaragua's biggest bank, won the auction for its
assets by the bank regulator. Banic has 50,000 customers and its
assets exceeded liabilities by 150 million cordobas, the
regulator said.

"We observe the handling of the end of Banic positively," said
Eduardo Balcartes, IADB representative in Nicaragua. "The
intervention was done efficiently and in a form that did not
disturb the tranquility of the system."



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

TELSCAPE: Update On ATSI's Acquisition Teleport Assets
------------------------------------------------------
ATSI Communications Inc. (AMEX:AI) and Telscape International
Inc.'s Chapter 11 Bankruptcy Trustee announced Monday that ATSI
has modified its bid to purchase Telscape's Houston-based
Teleport assets, which include telecommunications equipment,
accounts receivable and the related corporate customer base that
extends into Costa Rica, El Salvador, Nicaragua, Panama and
Venezuela, from the original bid of approximately $125,000 to a
new bid of nearly $95,000.

The bid has been modified due to changes in asset value and
damaged equipment at the Houston Teleport facility. The assets
are being sold as part of a court-supervised sale in the
bankruptcy proceedings of Telscape. A new court date is expected
to be set within three weeks to approve the new bid.

ATSI reiterates that the assets to be purchased include
Telscape's U.S.-based telecommunications equipment, multinational
customer base and accounts receivable. The purchase does not
include any of Telscape's assets owned by foreign subsidiaries or
affiliates.

To clarify Telscape's 8-K filing of Aug. 3, 2001, Telscape's
Trustee and ATSI's management are continuing to finalize all the
necessary modified closing documents and have agreed, subject to
the Bankruptcy Court's approval, to sign an Interim Operating
Agreement, allowing ATSI to preserve the value of the assets
until closing, which is expected to occur by Aug. 31, 2001.




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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contact Christopher Beard at 301/951-6400.


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