TCRLA_Public/011022.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

            Monday, October 22, 2001, Vol. 2, Issue 206



AEROLINEAS ARGENTINAS: Fargosi Named New President
EL SITIO: Claxson Sells Assets To Terra Lycos


LAB: Two US Firms Want 50 Percent Stake of VASP


BANCO ECONOMICO: Ciquini Stake To Be Liquidated In Auction
EMBRAER: Delegating Foreign Firms To Do ISS Work
EMBRATEL: Shares Drop On Earnings Concern Over Doubtful Accounts
GLOBO CABO: Shares Fall On Lower Earnings Forecast
MOULINEX: Court Suspends Decision Until Monday


COMPANIA MINERA: Reiterates 'All or nothing' Stand on Asset Sale
TELEFONICA CTC: Inks Option to Sell Stake in Sonda Until 2005


GEOMAQUE EXPLORATIONS: Advancing Loan Restructuring


AIR JAMAICA: Implements Insurance Surcharge


ABC-NACO: Mexican Subsidiary Not Included In Chapter 11 Filing
CINTRA: In Talks With Fed Govt. Over Loan Guarantee Request
GRUPO BITAL: May Be Forced To Submit New Audits


EDELNOR SA: Sells 100M Soles Of 5-Yr. Bonds To Refinance Debt

T R I N I D A D   &   T O B A G O

BWIA: Official Makes Clarifications On Fees Charged

     - - - - - - - - - - -


AEROLINEAS ARGENTINAS: Fargosi Named New President
Argentine lawyer Horacio Fargosi, a former member of Aerolineas
Argentinas' board of directors, was named the new president of
the Argentine airline, EFE reported Thursday.

The decision was made at a board of directors meeting held
Wednesday subsequent to the completion of Spanish consortium Air
Comet's deal to purchase the Argentine airline from Spanish
state-owned holding company SEPI.

Antonio Mata, who is also president of Air Comet, heads an
executive committee that manages the airline. Air Comet is a
partner with the tourism group Marsans, as well as the Spanair
and Air Plus airlines. The president of Air Plus, Argentine Luis
Lupori, is vice president of Aerolineas Argentinas' executive
committee, led by Mata.

EL SITIO: Claxson Sells Assets To Terra Lycos
Claxson (Nasdaq: XSON) announced Thursday it has sold certain
assets of, an e-commerce business targeting Mexico
and Mexican-Americans in the United States, to Terra Lycos
(Nasdaq: TRLY). The terms of the transaction were not disclosed.

El Sitio, Inc., the Internet company that merged to become part
of Claxson last month, had previously determined not to devote
the financial and other resources required to further develop Accordingly, El Sitio discontinued the operations
of in the second quarter of 2001.

Claxson stated that the divestiture of will free up
capital resources for deployment into growth initiatives for its
media businesses. Claxson, through its El Sitio network of Web
sites, will continue to offer users a shopping guide which
provides links to other websites for online sales by local and
U.S.-based e-merchants. The El Sitio network also provides a
shopping help center dedicated to assisting users as they
navigate the online buying process.

About Claxson

Claxson (Nasdaq: XSON) is an integrated provider of branded
entertainment content targeted to Spanish and Portuguese speakers
around the world. The company has a portfolio of popular
entertainment brands that are distributed over multiple platforms
through Claxson's combined assets in pay television, broadcast
television, radio and the Internet. Claxson was formed through
the merger of El Sitio and assets contributed by the Cisneros
Group and funds affiliated with Hicks, Muse, Tate & Furst Inc.
Headquartered in Buenos Aires, Argentina, and Miami Beach,
Florida, Claxson has a presence in all key Ibero American
countries and in the United States.

To see company's latest financial statement:

CONTACT:  Press & Media - Alfredo Richard of Claxson,
          or Jennifer Gery of Brainerd Communicators Inc.,
          or Investors, Jeff Majtyka,,
          or Lenny Santiago,
          both of Brainerd Communicators Inc., +1-212-986-6667


LAB: Two US Firms Want 50 Percent Stake of VASP
General Electric (GE) and International Leasing Financial
Corporation (ILFC) are seriously pursuing the 50 percent stake at
Lloyd Aereo Boliviano (LAB) that VASP intends to sell, reports
EFE News Service.

The two companies have reportedly tendered an offer to the
Bolivian government, which owns 48 percent of the flagship

According to the report, both companies plan to strengthen the
airline by extending it new capital and increasing its fleet of

Estimates peg the 50 percent stake held by the Brazilian-owned
VASP in LAB at approximately $30 million.

LAB is currently buried under a $50 million debt load, having
racked up losses totaling $18 million over the last two years.
But despite the swelling liabilities, the company is still
attractive to potential investors because of its annual turnover
of $ 150 million.

Accusations of mismanagement and corruption have been hurled
against the company lately.  The District Attorney's Office in
Cochabamba, where the carrier is headquartered, has already
initiated an investigation into the accusations.


BANCO ECONOMICO: Ciquini Stake To Be Liquidated In Auction
Troubled Banco Economico of Brazil is set to lose its majority
interest in petrochemicals company Ciquini this November,
according to a report in Business News Americas.

The liquidator of the bankrupt bank, Natalicio Pegorini, has
scheduled an auction of the bank's Ciquini shares next month, but
failed to specify the exact date.

Banco Economico owns 67 percent of ordinary shares and 56 percent
of the total shares in Ciquini, both valued approximately US$30

The company operates in the Camcari northeastern petrochemicals
pole in Bahia State, and the Taubate pole in Sao Paulo State.

EMBRAER: Delegating Foreign Firms To Do ISS Work
A press release Wednesday by Espacial revealed that Brazil's
contribution to the International Space Station (ISS) is running
the risk of being reduced to the production of small parts,
Gazeta Mercantil reported Thursday. Espacial stated that local
aircraft manufacturer Embraer, which is responsible for Brazil's
contribution to the space station, has delegated leading
engineering and development projects for the Brazilian equipment
to two foreign companies, Astrium and Goodrich.

Espacial is a consortium of 10 Brazilian aerospace companies.

To see company's latest financial statements:

CONTACT:  Anna Cecilia Bettencourt
          +55 12 345 1106

          Milene Petrelluzzi
          +55 12 345 3054

EMBRATEL: Shares Drop On Earnings Concern Over Doubtful Accounts
Brazil's largest long-distance provider Embratel lost 7.6 percent
to 7.30 reais, according to a report Thursday in Bloomberg.
Embratel has problems with customers not paying their bills, and
parent WorldCom Inc. may be selling some of its stock, after
deciding to exclude Embratel results on their balance sheet in
the last few months.

"I'd wait for something positive to happen before" buying
Embratel stock again, said Daniel Barker, emerging markets
portfolio manager with J&W Seligman & Co. in New York, who sold
the stock two years ago. "Until there is some kind of catalyst,
at best you'll tread water and you may lose."

To see company's latest financial statements:

CONTACT:  Embratel Participacoes S.A.
          Silvia M.R. Pereira
          Investor Relations
          TELEPHONE: (55 21) 2519-9662
          FAX: (55 21) 2519-6388


          Wallace Borges Grecco
          Press Relations
          TEL: (55 21) 2519-7282
          FAX: (55 21) 2519-8010

GLOBO CABO: Shares Fall On Lower Earnings Forecast
Shares of cable television provider Globo Cabo SA fell 4.6
percent to 62 Brazilian centavos on expectations of lower results
in the third quarter, Bloomberg reported Thursday.

"Subscribers could be in line or slightly lower than second
quarter, but average revenue per user could continue decreasing
as the economic slowdown affects consumer spending. As the
company reports in dollar we should see a decrease in revenue in
line with currency depreciation," UBS Warburg said in a report.

                              Marcio Minoru Miyakava, or
                              Luis Henrique Martinez
                              all of Globo Cabo S.A.
                              Rua Verbo Divino, 1356
                              Sao Paulo - SP - 04719-002 - Brazil
                              Phone: (5511) 5186-2681

MOULINEX: Court Suspends Decision Until Monday
The commercial court of Nanterre put off a decision over the fate
of ailing home appliance maker Moulinex Thursday, Reuters said in
a report. According to the court's presiding judge, Jean-Claude
Denis, none of the bids was acceptable as it stood, but added
that that could change.

"The tribunal has just heard that the conditions could be lifted
in the short term so that one of the solutions could become
acceptable," Denis said.

Denis further disclosed that the court would reconvene at 1500
hours (1300 GMT) on Monday, October 22, to decide whether to
accept one of the bids or wind up the firm for good.

Moulinex's French rival SEB and property fund Fidei, a unit of US
holding Leucadia, have both made partial offers for the ailing
company. But neither bid extends to Moulinex's loss-making
microwave ovens and vacuum cleaner businesses, and would only
save a limited number of the group's 21,000 jobs worldwide.


COMPANIA MINERA: Reiterates 'All or nothing' Stand on Asset Sale
Chilean copper mine Disputada de las Condes is sticking to its
"all or nothing" policy regarding the sale of its assets despite
buyers' interest in only two of them, according to a report in

Spokesman Guillermo Garcia recently said that the policy stands
even amidst talks that a potential buyer only wants its Los
Bronces and El Soldado copper mines.

"The answer is no. Disputada has a series of internal synergies
so that the whole is greater than the sum of its parts," said
Garcia when asked by Reuters if the company would be willing to
sell its three main assets separately.

Accordingly, Antofagasta Plc, which recently formalized its
interest in the company, is not keen on acquiring Disputada's
Chagres smelter.

Garcia, however, says the Company is talking with several other
interested buyers, although he declined to identify them due to a
"confidentiality agreement."

State-owned Codelco, the world's largest copper producer, is
reportedly pursuing the Company as well because of the proximity
of Los Bronces mine to Codelco's Andina mine.

Garcia says the Company is not expecting a sale to be finalized
until late this year or early next year.

TELEFONICA CTC: Inks Option to Sell Stake in Sonda Until 2005
Chile's Telefonica CTC has signed an option that will allow it to
sell its 60 percent stake in IT firm Sonda over the next four
years, Reuters reported Wednesday.

According to the report, the Company inked the deal with Sonda's
Andres Navarro (40 percent owner), as part of a recent strategic
move to give more focus on core telecom business holdings.

"This is due to the interest of Telefonica CTC Chile of
concentrating its investments in essential assets for the
development of the telecommunications business," explained a
statement released to Chile's securities regulators.

The option signed Monday will expire on June 30, 2005 and
provides for a minimum sale price of $94.4 million until the end
of 2003 and $84 million until June 20, 2005.

The Company claims the sale would have little impact on its
financial results.


GEOMAQUE EXPLORATIONS: Advancing Loan Restructuring
Geomaque Explorations Ltd. announced Thursday that it is
continuing to work with its principal lender, Resource Capital
Fund II L.P. of Denver, Colorado ("RCF"), on the restructuring of
its credit and security arrangements with RCF under the agreement
dated June 9, 2000 (the "Credit Agreement") and, has reached
agreement with RCF to further extend the time to finalize the
terms of this restructuring to November 6, 2001. In the meantime,
RCF has deferred all payments required under the Credit

Geomaque Explorations Ltd. is an international mining company
that is producing gold from its Vueltas del Rio Mine in Honduras
and San Francisco Mine in Mexico, and exploring for precious
metals in the Americas.

CONTACT:  John Paterson
          President and Chief Executive Officer
          Geomaque Explorations Ltd.
          1210-181 University Ave., Toronto, ON M5H 3M7,
          (416) 956-7470;


AIR JAMAICA: Implements Insurance Surcharge
National airline Air Jamaica has introduced its new insurance
surcharge on all tickets issued for travel on or after October
15, according to a report in The St. Vincent Herald. The carrier
was prompted to add the insurance tax on passenger tickets in the
wake of last month's terrorist attacks in the US and the
"dramatic increases" in insurance costs.

The insurance surcharge applies to all domestic and international
travelers on all Air Jamaica flights. It applies to all
passengers, including children and infants, holding tickets
issued on Air Jamaica or by other airlines for travel on Air

The surcharge is in addition to all other charges that already
apply and cannot be discounted, nor waived.

The surcharge of US$2.50 or its equivalent for each domestic
sector, and US$5 or its equivalent for each international sector,
will be collected at the time of ticket pick up and is applicable
to all fares.


ABC-NACO: Mexican Subsidiary Not Included In Chapter 11 Filing
ABC-NACO Inc. (ABCR) announced Thursday that the company and its
U.S. subsidiaries have filed voluntary petitions to reorganize
their businesses under Chapter 11 of the U.S. Bankruptcy Code.
The filings, due primarily to the severe downturn in the rail
supply industry and the company's large debt burden, were made in
the United States Bankruptcy Court for the Northern District of
Illinois, in Chicago.

Operations around the world, including the United States, will
remain open, operating to fulfill existing and future customer
requirements. This filing does not include the company's
subsidiaries or joint ventures in Canada, Mexico, Scotland,
Sweden, Portugal, or China.

Filing for reorganization became necessary due to a severe
liquidity crisis caused primarily by the exceptionally weak
market for ABC-NACO's products. Additional factors included the
80-day strike at the Sahagun, Hidalgo, Mexico facility and the
roof collapse at the Cicero, Illinois facility, both of which
occurred this past summer.

To ensure continuation of operations, ABC-NACO received a
commitment for a $20 million debtor-in-possession (DIP) financing
facility from its existing senior secured bank group. The
financing will become available for future operating obligations,
once approved by the court. Together with the cash generated from
operations going forward, this financing will provide the
necessary liquidity for the company to fulfill future obligations
to customers, suppliers and employees.

"Despite our efforts to reduce costs and maximize cash flow, the
continuing deterioration of the rail supply market significantly
aggravated our liquidity situation. After careful review of the
company's financial condition and all available alternatives, the
Board of Directors and senior management concluded today's court
filing by our U.S. operations was a necessity," said Vaughn
Makary, President and Chief Executive Officer of ABC-NACO.

The company has retained the management consulting firm of
Morris-Anderson and Associates, Ltd. and the investment banking
firm of Lincoln Partners L.L.C. to assist it in the evaluation of
reorganization alternatives in order to maximize its business
enterprise value.

Makary added, "In the best interest of our constituencies,
including our employees, the company's domestic and foreign
operating units will continue to serve their customers during
this process of maximizing business enterprise value."

The company said it is filing first day motions to support its
employees, customers and vendors, to obtain interim financing
authority, to maintain existing cash management programs, to
retain legal, financial, and other professionals relative to the
company's reorganization cases, and for other relief. The company
is retaining the law firm of D'Ancona & Pflaum L.L.C. to assist
in the court proceedings.

The company is one of the world's leading suppliers of
technologically advanced products to the rail industry. With four
technology centers around the world, the company holds pre-
eminent market positions in the design, engineering and
manufacture of high-performance freight car, locomotive and
passenger suspension and coupling systems, wheels and mounted
wheel sets. The company also supplies railroad and transit
infrastructure products and services and technology-driven
specialty track products. It has offices and facilities in the
United States, Canada, Mexico, Scotland, Portugal and China.

CONTACTS:  For ABC-NACO Investors:
           Restructuring Hotline

           For U.S./International Media:
           Wendy Bennett
           Director Corporate Communications

           ABC-NACO Inc.
           Wayne R. Rockenbach

CINTRA: In Talks With Fed Govt. Over Loan Guarantee Request
Cintra, the holding company for Aeromexico and Mexicana, is
seeking a government guarantee for a $50-million loan due this
month in order to allow airlines pay premiums for insurance
against accidents caused by terrorism, Mexico City daily El
Universal reported Thursday. According to Senator Eric Rubio
Barthell, the company is now in talks with the federal government
regarding the matter.

"Insurance for accidents caused by terrorism rose from 3 cents to
3.30 dollars per seat. That signifies, for the next year, close
to $50 million in additional payments to insurance companies, but
neither Aeromexico nor Mexicana have the money to pay this,"
related Rubio.

The proposed guarantee would be in addition to the contingency
plan announced by the Communications and Transport ministry.

The loan could come from domestic or foreign banks, Rubio said.

GRUPO BITAL: May Be Forced To Submit New Audits
Bital, along with other banks such as BBVA-Bancomer, Banamex and
Banorte, could be obliged to submit new audits once the National
Action Party (PAN) faction in the Chamber of Deputies reaches an
agreement with other legislators. According to a report Thursday
in Mexico City daily Reforma, these audits could lead to the
banks having to repay some of their 72 billion pesos in credit.

"The PAN does not accept the explanation of the bankers and some
authorities that report from auditor Michael Mackey was a
complete audit that limits the ability of the Chamber of Deputies
to complete other procedures," related Deputy Jaime Salazar

The Bank Savings Protection Law establishes that the banks should
submit to new audits, after which their old Fobaproa IOUs would
be substituted for IPAB notes.


EDELNOR SA: Sells 100M Soles Of 5-Yr. Bonds To Refinance Debt
In an effort to help cover maturing debt and finance investments,
Peruvian electricity distributor Edelnor SA sold 100 million
soles ($29 million) of five-year bonds, Bloomberg disclosed

According to Alberto Carrera, capital markets head at Citicorp
Peru SA, the bonds pay annual interest of 6.9 percent plus a
variable rate to compensate for inflation. Demand totaled 269
million soles, Carrera said.

Citicorp managed the sale along with BBVA Continental brokerage.

T R I N I D A D   &   T O B A G O

BWIA: Official Makes Clarifications On Fees Charged
Officials of BWIA said that the Airport Improvement Fee (AIF) is
a levy of the Airports Authority and that BWIA, like all
airlines, is "merely a collector," The Trinidad Express revealed
in a report.

In a statement issued Tuesday, the airline's Corporate
Communications director, Clint Williams, explained that the AIF
is a "user fee" concept where the users of the airport support
the maintenance of the facility they use.

According to Williams, these fees are normal at airports world-
wide and the International Air Transport Association (IATA) has
an administrative process to help airport authorities collect
this money though a charge on airline tickets.

BWIA, being a national carrier, has to represent all airlines
operating at Piarco, with IATA, Williams said. IATA then puts
procedures in place so that all tickets issued world-wide have
the AIF levy included and ensures that the collected fees are
remitted to the Airports Authority.

He said this process is being finalized and that passengers will
be advised when the fee will be included in their tickets.

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 and Edem
Psamathe P. Alfeche, Editors.

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

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.

Information contained herein is obtained from sources believed to
be reliable, but is not guaranteed.

The TCR Latin America subscription rate is $575 per half-year,
delivered via e-mail.  Additional e-mail subscriptions for
members of the same firm for the term of the initial subscription
or balance thereof are $25 each.  For subscription information,
contact Christopher Beard at 240/629-3300.

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