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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, August 20, 2001, Vol. 2, Issue 162

                           Headlines



A R G E N T I N A

AEROLINEAS ARGENTINAS: SEPI Shortlists Four Bidders
EL SITIO: Comments On Nasdaq Listing Requirements Compliance
EL SITIO: Shareholder Meeting To Approve Claxson Transaction Set


B R A Z I L

CVRD: Public Offer to Minority Shareholders - CPFL and SIBRA
ECONOMICO: Central Bank Hires BDO Directa To Appraise Ciquine
TELEMAR: Looks To Benefit From Anatel's Decision
TRANSBRASIL: Expects Reimbursement Of US$2.5M From GE
TRANSBRASIL: Aerus Takes Legal Action To Exclude From Fund


C H I L E

STARMEDIA: Wechsler Harwood Announces Securities Suit


C O L O M B I A

COLTEJER: Forecasting Brighter Future Through Increased Exports


M E X I C O

ATLANTICO: CNBV Predicts Acquisition To Come In Next Few Weeks
BANCA QUADRUM: Concrete Negotiations To Come Before Year-End
BUFETE INDUSTRIAL: Three Firms Helping To Launch New Projects
GRUPO TRIBASA: Restructuring Far From Over


P E R U

AGRO GUAYABITO: Indecopi To Declare Insolvency Within 90 Days
PESQUERA SAN ANTONIO: Attracts Hochschild, Two Consortiums
SAYAPULLO: Shareholders Approve Year-Long Restructuring Plan


     - - - - - - - - - -


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

AEROLINEAS ARGENTINAS: SEPI Shortlists Four Bidders
---------------------------------------------------
Sociedad Estatal de Participaciones Industriales (SEPI) has
narrowed down to four the number of candidates it is considering
for taking over its 91.2-percent stake in bankrupt Argentine
airline Aerolineas Argentinas. SEPI chose Air Plus Argentina (a
subsidiary of Spanish group Marsans), a group of investors
including Aerolineas Argentinas' former president and Boeing, the
Argentine company Clicknest, and a US investment fund, which
requested maintaining anonymity.

The four takeover candidates must present a viability plan for
Aerolineas guaranteeing its financial future. SEPI recently said
will announce the winning bidder in September.

Aerolineas Argentinas was privatized in 1990 as a debt-free
company with 28 airliners. The company is currently saddled with
debts of about $900 million (1.04 billion euros) and is losing
about $300 million per year.


EL SITIO: Comments On Nasdaq Listing Requirements Compliance
------------------------------------------------------------
El Sitio, Inc. (Nasdaq: LCTO) on Thursday provided updates
regarding the status of its listing on the Nasdaq National Market
("Nasdaq") and of its proposed merger with Ibero-American Media
Partners.

Nasdaq Update

On May 18, 2001, El Sitio reported that it had received
notification from Nasdaq that its common shares had failed to
maintain a minimum bid price of $1.00 for 30 consecutive trading
days and other listing requirements as required by Nasdaq rules,
and that El Sitio would have until August 14, 2001 to regain
compliance with Nasdaq's continued listing requirements. On
August 15, 2001, El Sitio received a Nasdaq staff determination
that El Sitio had failed to comply with the minimum bid price
requirement for continued listing set forth in Marketplace Rule
4310 (c)(8)(B) and other listing requirements, and that its
common shares would be, therefore, subject to delisting from
Nasdaq, effective as of August 23, 2001. El Sitio plans to
request a hearing before a Nasdaq listing qualifications panel to
review and appeal the staff determination. El Sitio anticipates
that Nasdaq will stay the delisting pending resolution of this
appeal, although there can be no assurance the panel will grant
El Sitio's request for continued listing. The appeal process
generally takes approximately 30 days to conclude.

As reported on August 8, 2001, El Sitio's Board of Directors has
approved a 1-for-10 reverse share split for its common shares.
The reverse share split will be effective on August 22, 2001 for
shareholders of record as of that date. El Sitio anticipates that
this action will allow it to meet Nasdaq's minimum bid price
listing requirement, as well as Nasdaq's other listing
requirements.


EL SITIO: Shareholder Meeting To Approve Claxson Transaction Set
----------------------------------------------------------------
The Securities and Exchange Commission has declared effective the
Form F-4 registration statement of Claxson Interactive Group,
Inc. ("Claxson"), which is the entity to be formed by the
combination of El Sitio and Ibero-American Media Partners and
certain other businesses owned by members of the Cisneros Group
of Companies. A proxy statement/prospectus pertaining to the
merger is being mailed to shareholders of El Sitio in preparation
for a shareholders' meeting to be held on September 7, 2001 to
approve the transaction. Claxson will be an integrated provider
of branded entertainment content targeted to Spanish and
Portuguese speakers around the world. Under the terms of the
agreement each El Sitio common share will be exchanged for one
new common share of Claxson. The combined company will have
approximately 18.5 million common shares outstanding. Claxson has
applied to Nasdaq to list its shares under the symbol "XSON."



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B R A Z I L
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CVRD: Public Offer to Minority Shareholders - CPFL and SIBRA
------------------------------------------------------------
Companhia Vale do Rio Doce (CVRD) disclosed Wednesday that its
subsidiaries Companhia Paulista de Ferro Ligas (CPFL) and SIBRA -
Eletrosider£rgica Brasileira S.A., will call an extraordinary
general shareholders meetings to deliberate about their
delisting. Following the meeting, CVRD will make an official
public offer to buy back shares held by minority shareholders of
both companies, according to the CVM Instruction 229 of January
16, 1995.



ECONOMICO: Central Bank Hires BDO Directa To Appraise Ciquine
-------------------------------------------------------------
The Brazilian Central Bank hired the auditing firm BDO Directa to
appraise Ciquine, a producer of alcohols and plasticizers in
Camacari complex (Bahia), Gazeta Mercantil reported Wednesday.
Ciquine is controlled by Conepar Petroquimica, which is held by
Economico, the group which was intervened by the Central Bank.

Ciquine is the last asset of the sector held by ex-banker Mr.
Angelo Calmao de Sao and according to analysts' estimates, its
value stands at about US$30 million. The Central Bank aims to
sell off the company by mid October. The prospective bidders are
Elekeiroz from Itausa group and Petrom (Petroquimica Mogi das
Cruzes).


TELEMAR: Looks To Benefit From Anatel's Decision
------------------------------------------------
Telemar may benefit from the decision of the Brazilian
telecommunications regulatory agency Anatel allowing Vesper and
GVT companies to supply their customers with so-called mobile
terminals for fixed phone operations, Valor Economico reported
Aug. 13, 2001. Since this technology is compatible with cellular
phone service, Telemar may be able to offer cell service in the
areas in which it offers fixed service, using the same networks
without increased costs.

Telemar is installing phones in the poorest areas of the country
in order to meet the government's requirements for universal
service and is facing increased difficulties collecting customer
payments.


TRANSBRASIL: Expects Reimbursement Of US$2.5M From GE
-----------------------------------------------------
As a result of its lawsuit, the Brazilian air transportation
company Transbrasil anticipates some US$2.5 million in
reimbursement for financial and moral damages from GE Capital
Corporation, O Globo reported Thursday. Transbrasil sued GE on
Tuesday for causing a reduction in the number of its passengers,
cancellation of reservations and harming its image when GE sought
to have the carrier declared bankrupt in the middle of July 2001.
GE had took the measures against Transbrasil for allegedly
failing to pay a debt. However the move was later determined to
be unfounded, prompting the Brazilian Justice to deny such
request.


TRANSBRASIL: Aerus Takes Legal Action To Exclude From Fund
----------------------------------------------------------
Brazilian pension fund Aerus decided to commence legal action
once again, in the form of a request to exclude the troubled
Brazilian airline Transbrasil from the fund, citing failure to
pay premiums for the months of June and July, Valor Economico
reported Tuesday. Earlier this year, Transbrasil renegotiated its
debts with Aerus, but now its debt of R$13.5 million has come
due. The amount currently owed includes deductions from workers'
salaries that the carrier has not forwarded to Aerus. The fund
will make pension benefits available to Transbrasil employees who
are set to retire in less than 60 days.

Meanwhile, Transbrasil has to return another aircraft to the
leasing company Ansett in early August, an action which will
reduce its fleet to twelve planes.



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C H I L E
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STARMEDIA: Wechsler Harwood Announces Securities Suit
-----------------------------------------------------
A class action lawsuit was filed in the United States District
Court for the Southern District of New York on behalf of
purchasers of the securities of StarMedia Network, Inc. (Nasdaq:
STRM) between May 25, 1999 and December 6, 2000, inclusive.

The action is pending against defendants StarMedia Network and
certain of its officer and directors, as well as Goldman Sachs &
Co., Fleet Boston Robertson Stephens, Inc., J.P. Morgan Chase &
Co., Salomon Smith Barney, Inc., Credit Suisse First Boston,
Inc., and Morgan Stanley & Co., Incorporated.

The complaint alleges violations of Section 10(b) of the
Securities Exchange Act of 1934 and Rule 10b-5 promulgated
thereunder. On or about May 25, 1999, StarMedia commenced an
initial public offering of 7,000,000 of its shares of common
stock at an offering price of $15.00 per share (the "StarMedia
IPO"). In connection therewith, StarMedia filed a registration
statement, which incorporated a prospectus (the "Prospectus"),
with the SEC. The complaint further alleges that the Prospectus
was materially false and misleading because it failed to
disclose, among other things, that: (i) defendants had solicited
and received excessive and undisclosed commissions from certain
investors in exchange for which defendants allocated to those
investors material portions of the restricted number of StarMedia
shares issued in connection with the StarMedia IPO; and (ii)
defendants had entered into agreements with customers whereby
defendants agreed to allocate StarMedia shares to those customers
in the StarMedia IPO in exchange for which the customers agreed
to purchase additional StarMedia shares in the aftermarket at
pre-determined prices. As alleged in the complaint, the SEC is
investigating underwriting practices in connection with several
other initial public offerings.

Plaintiff seeks to recover damages on behalf of class members.



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

COLTEJER: Forecasting Brighter Future Through Increased Exports
--------------------------------------------------------------
Colombian textile group Coltejer is looking to increase by 30
percent its exports this year, South American Business
Information reported Tuesday. Although national demand for
textiles has dipped generally, Coltejer was able to out-perform
its sector counterparts, benefiting from a plunge in
international textile purchasing and successful anti-contraband
campaigns. The firm's debt restructuring program has already led
creditors namely Magnun Logistics, Intergrupo Limitada, Industria
del Maiz and Trenzados Medellin, to recharacterize certain
amounts owed.



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M E X I C O
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ATLANTICO: CNBV Predicts Acquisition To Come In Next Few Weeks
--------------------------------------------------------------
Mexican financial regulator the National Banking and Securities
Commission (CNBV) agreed with Grupo Financiero Bital executives
that the acquisition of Banco del Atlantico from bank bailout
agency IPAB should be possible within the next few weeks,
according to a report Thursday in Mexican financial daily El
Economista. The CNBV pointed out the importance in finalizing the
issue of Bital's purchase of Atlantico saying that this will
allow Bital to concentrate on the process of capitalization.
Bital has run Atlantico for the last 3 years but is still
awaiting the final audit to finish merging operations.


BANCA QUADRUM: Concrete Negotiations To Come Before Year-End
------------------------------------------------------------
Banca Quadrum expects to reach definitive agreements with
investors before the end of the year, Mexican financial daily El
Economista reported Thursday. In a statement, the bank explained
that the negotiations aimed at strengthening the bank's capital
structure have been conducted by the bank's administration in
close coordination with financial authorities. Quadrum also
revealed that it has already completed important investments in
technological development and communications, as well as several
strategic alliances, the most important of which was with Mexican
retailer Elektra for the commercialization of mortgages with
resources from the Fund for Housing (Fovi).

Earlier, Mario Di Constanzo, a consultant for the Democratic
Revolutionary Party called for IPAB's intervention into Quadrum
saying that the bank's results made it clear that it is unviable
in the short term. According to him, the bank is basically
'bankrupt' because, fundamentally, its operating costs and
infrastructure are too high for the market that it is in.

However, Quadrum refuted Constanzo's comments saying those were
exaggerated because the bank meets the minimum internationally
accepted Basle index of 8 percent. However, the bank lacks
capital necessary to enter the low-income mortgage segment and is
therefore looking for buyers or partners.


BUFETE INDUSTRIAL: Three Firms Helping To Launch New Projects
-------------------------------------------------------------
Three undisclosed companies are considering working with
financially-strapped Mexican construction company Bufete
Industrial. The joint efforts would be aimed at helping the
company pursue new projects for state-owned oil company Petroleos
Mexicanos and Mexican state-owned power utility the Federal
Electricity Commission, Mexican financial daily El Economista
reported Thursday.

Sergio Bolanos Quesada, who recently paid a token 1,000 pesos to
acquire Bufete, is also taking part in a petrochemical project in
Altamira, Tamaulipas, involving the investment of $4.5 billion
dollars, for which the company has signed a contract for $500
million.

Bufete, which still continues to be in suspension of debt
payments, has been de-listed from the Mexican Stock Exchange and
the New York Stock Exchange. However, Bolanos reportedly has
plans to re-list the company as its financial condition improves.


GRUPO TRIBASA: Restructuring Far From Over
------------------------------------------
Analysts revealed that Mexican builder Grupo Tribasa hasn't had
any big advances in its fiscal and financial restructuring,
Mexican financial daily El Economista reported Thursday. The
efforts, which started in 1999 with the search for a new
investor, continue without much result. The analysts covering the
company say Tribasa has to conclude an agreement with banks and
fiscal authorities for its financial restructuring. They also
pointed out the importance of completing an alliance to obtain
capital injection would give it an opportunity for better
prospects.

Tribasa's financial situation prompted the company to inform the
Communications and Transportation ministry last March that, it
was "practically out" of the group of companies that made up
Grupo Aeroportuario del Sureste (Asur).



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P E R U
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AGRO GUAYABITO: Indecopi To Declare Insolvency Within 90 Days
-------------------------------------------------------------
The Indecopi commission is to declare Agro Guayabito insolvent
within the next 90 days, Gestion reported Monday. This move
follows creditors' refusal on August 10 to approve the
agribusiness company's restructuring plan. The proposed plan was
elaborated by Consultoria A.

Agro Guayabito has debts totaling US$50 million, of which US$27
million are owed to banks and US$5 million to suppliers. The
Peruvian company owns a total area of 4,550 ha, but only uses 717
ha at present.


PESQUERA SAN ANTONIO: Attracts Hochschild, Two Consortiums
----------------------------------------------------------
So far, the predicted sale of a 100-percent stake in fishing
company Pesquera San Antonio has drawn the interest of Grupo
Hochschild and 2 consortiums, Gestion reported Aug. 13, 2001. One
of the two consortiums consists of Pesquera El Angel (Grupo
Ibarcena), Pesquera Alexandra and Pesquera Centinela, while the
other includes Pesquera Diamante and Copeinca. Market sources
revealed that Grupo Hochschild offered to pay US$25 million in
cash for Pesquera. On the other hand, the consortium teamed by
Diamante and Copeinca proposed paying US$35 million in
installments. The El Angel, Alexandra and Centinela group
apparently bid a lesser amount.

Pesquera San Antonio has been undergoing a restructuring process
since May last year, at which point its debts totaled US$86.12
million.


SAYAPULLO: Shareholders Approve Year-Long Restructuring Plan
------------------------------------------------------------
In a statement to the Lima Stock Exchange, Sayapullo revealed
that its shareholders have agreed to a year-long restructuring of
the company. As a result, the company will delay its search for a
strategic investor, the payment of mining rights and selling the
its ADS shares in telecom giant Telefonica, Business News
Americas reported Tuesday. These decisions were taken after the
company learned that a civil court in Lima declared the legal
action of polymetallic miner Milpo unfounded. Milpo, a minority
shareholder, had asked for decisions previously ratified at the
July 2000 general meeting to be declared void.

The problems of the voluntarily insolvent Pervian mining company
Sayapullo began more than two years ago when its mine in the
north of Peru was damaged by severe storms blamed on the El Nino
weather phenomenon.




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
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Psamathe P. Alfeche, Editors.

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

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