TCRLA_Public/011026.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

            Friday, October 26, 2001, Vol. 2, Issue 210

                           Headlines


B R A Z I L

CVRD: To Acquire Phelps Dodge's 50% Stake In Sossego Project
EMBRATEL: Cutting Investments For 2002 Unless Rules Change
TELE CENTRO: Shares Fall On Parent's Rumored Bankruptcy
VARIG: Creates New Aircraft-Maintenance Company


M E X I C O

BANCO ATLANTICO: Bital Shareholders To Vote On Acquisition
BUFETE INDUSTRIAL: Yields To Economic Woes
CINTRA: Hears Good News Amid Worsening Industry Crisis
HYLSAMEX: Investors Urge Alfa Chairman To Dump Steel Unit

MAXCOM TELECOMUNICACIONES: CSFB To Assist In Bond Restructuring
MAXCOM TELECOMUNICACIONES: Announces 3Q01 Unaudited Results
MAXCOM TELECOMUNICACIONES: Gets a Nationwide Telephony Concession
TRI-NATIONAL DEVELOPMENT: Mexican Properties Listed In Ch. 11
TRI-NATIONAL DEVELOPMENT: Senior Care Extends Shareholder Tender

VITRO SA: Reveals Options For Dealing With Bond Refinancing
VITRO SA: 3Q01 Unaudited Results; EBITDA Down, Debt Reduced


P A N A M A

CHIQUITA BRANDS: Announces 3Q Results; Still Negotiating Debts
CHIQUITA BRANDS: May Restructure Debt With Bankruptcy Protection


P E R U

AEROCONTINENTE: Chile's Investigation Stumped On Judge's Ruling
NUEVO MUNDO: Regulator To Name Repayment Overseer This Week


     - - - - - - - - - - -


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

CVRD: To Acquire Phelps Dodge's 50% Stake In Sossego Project
------------------------------------------------------------
In a company press release, Phelps Dodge Corporation and
Companhia Vale do Rio Doce (CVRD) announced Wednesday they have
entered into an agreement in which Phelps Dodge will sell to
CVRD, through CVRD's subsidiary Itabira Rio Doce Company Limited
(ITACO), its 50 percent stake in the joint-venture company,
Mineracao Serra do Sossego S.A., for US $42.5 million. The joint
venture, in which CVRD currently holds 50 percent ownership, has
conducted exploration and feasibility studies for the potential
development of the Sossego copper-gold deposit in the Carajas
region of Brazil. The transaction is contingent on successful
completion of customary closing conditions.

Phelps Dodge and CVRD formed the joint venture in 1998 after
initial drilling identified potentially significant copper
mineralization in the area. A pre-feasibility study was completed
in 2000 with a feasibility study completed in May 2001.

Phelps Dodge Corporation is the world's second largest producer
of copper, the world's largest producer of continuous-cast copper
rod and molybdenum, and is ranked among the world's largest
producers of carbon black and magnet wire. Phelps Dodge has
operations and investments in mines and manufacturing facilities
in 27 countries.

CVRD is the largest diversified mining company of the Americas,
with a market capitalization of approximately US $8 billion. It
is the world's largest producer of iron ore. CVRD is one of the
global leading producers of manganese and ferro-alloys and it is
involved in bauxite, gold, kaolin and potash mining as well as
alumina, aluminum and steel production. CVRD is a major
transportation player in Brazil, owning and operating several
railroads and ports.

CONTACT:  Stanton K. Rideout, Investors, +1-602-234-8589,
          or Danielle M. Sittu, Media, +1-602-234-8318,
          both of Phelps Dodge;
          or Roberto Castello Branco, 55-21-8144540,
          castello@cvrd.com.br,
          Andreia Reis, 55-21-3814-4643,
          andreis@cvrd.com.br,
          Barbara Geluda, 55-21-3814-4557,
          geluda@cvrd.com.br,
          or Daniela Tinoco, 55-21-3814-4946,
          daniela@cvrd.com.br,
          all of CVRD


EMBRATEL: Cutting Investments For 2002 Unless Rules Change
----------------------------------------------------------
Beginning next year, Brazilian long-distance operator Embratel
could branch out into other areas in the country's
telecommunications industry as the market opens up further to
competition, Reuters said Wednesday.

However, according to Embratel President Jorge Rodriguez, the
company will not be pursuing new ventures unless the rules
change. As such, the company is cutting its scheduled 2002
investments to between 700 million reais ($256 million) and 900
million reais from initial plans to invest as much as 1.3 billion
reais.

"With the current rules there is no interest in entering into
local telephony, so we are going to reduce investments in part
for this reason and in part due to the market's and economy's
behavior," he said.


TELE CENTRO: Shares Fall On Parent's Rumored Bankruptcy
-------------------------------------------------------
Preferred shares of wireless phone operator Tele Centro Oeste
Participacoes SA fell 9 percent to 4.84 reais, according to a
report Wednesday in Bloomberg.

Prices dropped on rumors that Splice do Brasil, one of Tele
Centro Oeste's controlling entities, would file for protection
from creditors, said Carolina Gava, a telecommunications analyst
at BES Securities in Rio de Janeiro.

"People were also saying the wireless company's results will be
disappointing. I believe there's no basis for these rumors but
investors started selling Tele Cento Oeste to buy Telesp
Celular," she said.


VARIG: Creates New Aircraft-Maintenance Company
-----------------------------------------------
Struggling through growing financial problems in the airline
industry, Brazil's Varig is forming an aircraft-maintenance
company, EFE said Wednesday.

The new company, Varig Engenharia e Manutenzao, will cater both
to Brazilian and foreign airlines and is designed to diversify
Varig's income streams. Varig chief Ozires Silva expects that the
new maintenance division may bring in some $500 million over the
next five years.

Varig has been hard-hit by the industry's financial woes,
aggravated by the Sept. 11 hijack-bombings in the United States.
The company plans to lay off 1,700 employees beginning in
November.

CONTACT:  VARIG Brazil
          Media Relations
          21-3814-5480



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

BANCO ATLANTICO: Bital Shareholders To Vote On Acquisition
----------------------------------------------------------
Shareholders were scheduled to meet soon in order to approve the
acquisition of Banco del Atlantico from bank bailout agency IPAB,
reported Mexican financial daily El Economista Wednesday.

Shareholders must come to terms with a clause that says IPAB
would be entitled to a proportional part of the profit that Bital
would receive from the future sale of itself, depending on
Bital's sale price.

IPAB has decided to include such a clause in an agreement to
support a bank after being pummeled with criticisms from
legislators that the high-priced sale of Banamex to Citigroup --
after the government bailed the Mexican bank out of a financial
crisis -- was unfair to the nation's taxpayers.

IPAB is agreeing to cover the 15 billion-peso cost of
reorganizing Banco del Atlantico.


BUFETE INDUSTRIAL: Yields To Economic Woes
------------------------------------------
Mexican construction company Bufete Industrial, which Corporacion
Serbo recently acquired, finds itself with grave liquidity
problems due to the current economic situation, Mexican financial
daily El Economista reported Wednesday.

As a result of its mounting troubles, the company is now a couple
of weeks behind on paying its 700 employees at a time when Serbo
had begun rebuilding its workforce. Serbo has been forced to use
up its available cash flow in order to pay personnel.


CINTRA: Hears Good News Amid Worsening Industry Crisis
------------------------------------------------------
Aaron Dychter, a Transport and Communications ministry (SCT)
senior official announced that the federal government would
support Mexico's airlines in covering the increased insurance
premiums they are paying, Mexico City daily Reforma reported
Wednesday.

This could be good news for Cintra, the holding company that owns
Aeromexico and Mexicana. Cintra had requested that the government
help pay for the difference in the increased insurance premiums.

According to Dychter, the SCT and the Finance ministry are
working to define the plan that will be used to provide the
support.

"This week the Finance ministry will announce it. I don't know
what the terms will be, but we are going to see how the federal
government can help," he said.

"It's a subject that I would say is concluded," he said, with
which the Mexican airlines will guarantee to continue flying
without any problem.


HYLSAMEX: Investors Urge Alfa Chairman To Dump Steel Unit
---------------------------------------------------------
Investors of industrial group Alfa SA are urging Dionisio Garza
Medina, Alfa's chairman and chief executive, to give creditors
control of its debt-ridden Hylsamex SA steel unit, Bloomberg said
Wednesday.

Hylsamex, once the cornerstone of Alfa, accounts for more than
half of its $2.6 billion debt.

"When you run a portfolio of businesses, the key is knowing when
to get rid of an asset that is a drag on performance," said
Christopher Palmer, who helps manage about $260 million in Latin
American stock at Gartmore Investment Management in London.

"They've got to cut the cord on the steel business."

Palmer revealed he's been buying Alfa's stock recently in hopes a
permanent solution to Hylsamex's debt problems will cause shares
to bounce.

Alfa's shares have fallen 51 percent in the past 52 weeks and
have plummeted 89 percent since October 1997 when slowing Asian
economies led to a flood of cheap steel and petrochemical
products on world markets.

Analysts predict Hylsamex will have to restructure its $1.4
billion debt, which would be the second time in two decades Alfa
has failed to meet payments on billions of dollars in loans.


MAXCOM TELECOMUNICACIONES: CSFB To Assist In Bond Restructuring
---------------------------------------------------------------
Start-up Mexican telephone company Maxcom Telecomunicaciones SA
hired Credit Suisse First Boston to help it restructure $275
million of bonds sold a year ago as the company continues to lose
money, Bloomberg reported Wednesday.

In a statement, the company said it has hired Credit Suisse "to
explore financing options and to evaluate other strategic
alternatives, including debt restructuring."

Maxcom reportedly has money in an escrow account to make one more
payment in April. However, analysts believe that the company is
unlikely to have enough cash to continue servicing the debt.

"Certainly this restructuring is not a surprise," said Bruce
Stanforth, a debt analyst with BNP Paribas in New York. "We've
been talking about what it might look like."

Maxcom didn't provide any details or timetable for a solution to
its debt problem.

The 13 3/4 percent bond maturing in April 2007, which was
originally a $300 million sale, is now trading at less than 20
cents on the dollar. The company bought back $25 million of the
bonds in June.

In its earnings report, the company said it expects to break even
on cash generation, or EBITDA, by the first of next year as it
increases the number of phone lines and lowers cancellations. But
that won't be enough to pull it out of debt problems, Stanforth
said.

The company needs even more cash to continue growing and is
unlikely to find a partner to boost its finances with the current
recession in Mexico.

"Their assets are valuable but until you have a buyer they only
have theoretical value," Stanforth said.

That could leave bondholders with little option other than taking
an equity stake in the company in exchange for writing off debt,
he said.

CONTACT:  Jose-Antonio Solbes
          Maxcom Telecomunicaciones, S.A. DE C.V., in Mexico,
          +001-525-147-1125, or
          investor.relations@maxcom.com.mx;
          or Lucia Domville of Citigate Dewe Rogerson,
          +1-212-419-4166, or lucia.domville@citigatedr-ny.com


MAXCOM TELECOMUNICACIONES: Announces 3Q01 Unaudited Results
-----------------------------------------------------------
Maxcom Telecomunicaciones, S.A. de C.V., a facilities-based
telecommunications provider (CLEC) using a "smart build" approach
to focus on small- and medium-sized businesses and residential
customers in Mexico City and Puebla, announced Wednesday its
unaudited results for the third quarter of 2001.

NOTE: Maxcom commenced commercial operations on May 1, 1999;
therefore, during 2000 a comparison with 1999 was not meaningful.
Effective first quarter of the year 2001, Maxcom began comparing
its reporting periods to the same quarter of the previous year.
In some cases throughout this document references will be made to
the three-month period ended on June 30, 2001. Financial
statements are reported in period-end pesos as of September 30,
2001 and adjusted for the inter-period effect of inflation.

LINES:

During 3Q01, 27,459 new lines were installed, a 472% increase
compared to the 4,803 new lines installed during 3Q00, and 150%
more than the 10,982 lines installed in 2Q01. Maxcom's
installation rate has been above 10,000 lines for the last two
months.

During 3Q01, 3,878 lines were disconnected. September 2001 trends
showed encouraging results with only 430 disconnections during
the month, which represents a churn rate below 1%.

Backlog of sold lines ready-to-be-installed as of September 30,
2001 was of 4,000 lines. Backlog of constructed lines at the
close of the quarter was approximately 50,000 lines: of which
4,000 lines were in the process of installation; 12,000 continued
to be under a special sales program; and, the remaining 34,000
are available for sale. With the exception of the installation
cost, none of these lines require additional CAPEX to provide
dial tone.

The Company enhanced its cluster-design processes starting with
market targeting to line installation. While in the past clusters
were planned to be filled up in three years, starting this
quarter clusters are designed to be fill up in 90 days,
emphasizing on higher socioeconomic areas. This change in the
process was slightly reflected in 3Q01, when Maxcom continued
with the inertia of clusters designed in the past, with a heavy
concentration in residential lines from lower-tier socioeconomic
levels and a limited potential for business lines. This fact,
combined with the slowdown of the Mexican economy led the growth
during the quarter to converge in residential lines, Which grew
111% quarter over quarter while business lines grew 26% over the
same period.

The net number of lines at the end of 3Q01 increased 139% to
56,786 from 23,724 lines at the end of 3Q00, and 71% from 33,205
lines registered at the end of 2Q01. During 3Q01 Maxcom profited
from the recurrent revenue and the branding & product acceptance
based on the growth opportunity in residential lines. The
Company's strategy continues being focused on constructing
clusters with greater business participation and business single
sites to achieve a mix of 40 to 50% business lines to total
lines.

"Our net installed lines at the end of the period, which have
doubled during the past six months, show three of our key
strategic objectives: 1) to continue our explosive growth in net
new lines; 2) our newly implemented philosophy to establish a
customer culture addressed to retain our valuable customers; and,
3) to achieve EBITDA breakeven level by December or early next
year," stated Fulvio V. Del Valle - President and Chief Executive
Officer.

"We truly believe in Maxcom's business model, we have made it
work. Now, with the concession to cover the whole Mexican
Territory granted to us, we will make sure that Maxcom is the
first choice for those customers willing to change or to add a
new line driven by state of the art technology, high quality
standards and customer care. Our company will continue delivering
the best products in the market, while we also emphasize on
industry standard controls, improving efficiency, productivity
and teamwork." added Mr. Del Valle.

CUSTOMERS:

Total customers grew 442% to 32,621 in 3Q01, from 6,015 in 3Q00,
and 75% from 18,653 reported at the end of 2Q01, reflecting the
Company's continued effort to strengthen and diversify its
customer base.

REVENUES:

Revenues for 3Q01 decreased 11% to Ps$74.6 million, from
Ps$84.1million registered in 3Q00; Revenues increased 25% from
Ps$59.6 million reported in 2Q01. The change in revenues when
compared to 3Q00 reflects a 51% decrease in ARPU generated by:
(1) disconnection of high volume customers; (2) the price
reduction in Troncalmax Inbound monthly charges effective since
February 2001; (3) lower non-recurrent charges; and, (4) the
increase in residential lines from 21% as of September 2000 to
65% as of September 2001.

The decrease in ARPUs was partially compensated by a 139%
increase in number of lines. When compared to 2Q01, the 25%
increase in Revenues was driven mainly by new lines and traffic
growth within our core business as well as higher non-recurrent
charges.

"With the experience of 25% improvement in revenues quarter over
quarter, and of 22% in September when compared to the previous
month, added to our focus of controlling expenses and improving
costs, we are confident that we can achieve EBITDA breakeven
level by the end of this year as we anticipated during our
Investor Day back in May 2001," said Eloisa Martinez, Maxcom's
Chief Financial Officer.

COST OF NETWORK OPERATION:

As a result of Industry best practices and to present comparable
figures, the following items are explained on a pro-forma basis.

Cost of Network Operation was reported as follows: Ps$38.7
million in 3Q01; Ps$33.0 million in 3Q00; and, Ps$42.0 in 2Q01.
On a pro-forma basis, Cost of Network Operation was: Ps$38.7
million in 3Q01; Ps$47.6 million in 3Q00; and, Ps$30.6 million in
2Q01.

The 27% increase from 2Q01 was driven by installation costs,
given that during 3Q01 most of the installation of residential
lines included installation charges where margins are minimal.
The rest of the variations in cost of network operation line
items correspond to revenue growth. When compared to 3Q00, the
net decrease was 19%. The decline combined the costs growth
derived from a higher number of lines with the savings of 45% on
leased dedicated circuits, as the Company began moving its POPs
to its own FO ring in Mexico City on October 2000.

SG&A:

SG&A were reported as follows: Ps$100.4 million for 3Q01, Ps$97.5
million in 3Q00, and Ps$82.6 in 2Q01. On a pro-forma basis, SG&A
for 3Q01 were Ps$100.4 million for 3Q01, Ps$87.4 million in 3Q00,
and Ps$88.2 in 2Q01.

The increase of Ps$13.0 million from 3Q00 and Ps$12.2 million
from 2Q01 were due to higher expenses in salaries, wages and
benefits; external sales commissions; marketing expenses; leasing
of additional warehousing capacity; and, additional IT consulting
fees; and, a positive variance in bad debt reserve provisioning.

Total Salaries, Wages and Benefits for 3Q01 were Ps$57.5 million,
compared to Ps$55.3 million in 3Q00, and Ps$60.2 million in 2Q01.
As of September 30, 2001, employee headcount was 699 compared to
402 employees as of September 30, 2000, and 650 employees as of
June 30, 2001. Worth mentioning is that Sales, Wages and Salaries
for 3Q01 included the cost of having a full management team in
place, while in 3Q00 the Company spent as an additional fee of
Ps$11.6 million for having interim management.

External sales commissions for 3Q01 were Ps$8.1 million; the
Company implemented this sales practice late in 2Q01, when
commissions were Ps$2.3 million.

Marketing Expenses for 3Q01 amounted to Ps$6.5 million from
Ps$2.5 million in 3Q00, and Ps$5.2 million in 2Q01.

The Company provisioned Ps$1.6 million for Bad Debt Reserve in
3Q01, in compliance with its adjusted Bad debt policy.

EBITDA:

As reported, EBITDA for 3Q01 was negative Ps$64.5 million,
compared to a negative EBITDA of Ps$46.5 million in 3Q00. EBITDA
in 2Q01 was negative Ps$65.0 million. On a pro-forma basis,
EBITDA was negative Ps$64.5 million, compared to negative EBITDA
of Ps$50.9 million in 3Q00. EBITDA in 2Q01 was negative Ps$59.1
million.

Although EBITDA worsened 9% when compared to the previous
quarter, on a monthly basis September 2001 showed an encouraging
result, negative EBITDA for the month was Ps$15.6 million, 38%
better than the Ps$25.3 million registered in August 2001; and,
21% better than the monthly average for 2Q01.

CAPITAL EXPENDITURES:

Capital Expenditures for 3Q01 were Ps$252.7 million, compared to
Ps$16.5 million in 3Q00. CAPEX in 2Q01 were Ps$97.2 million.

CASH POSITION:

Maxcom's Cash position at the end of the third quarter of 2001
was Ps$491.7 million (Ps$393.9 million in Cash and Cash
Equivalents and Ps$97.8 million in Maxtel bonds, equivalent to
US$25 million face value), and Ps$389.4 million in Restricted
Cash (deposited into an escrow account to guarantee debt service
until April 2002 for the US$300 million 13.75% senior notes due
2007), compared to Ps$1,227.2 million in Cash and Cash
Equivalents, and Ps$806.1 million in Restricted Cash at the end
of 3Q00, and to Ps$740.7 million (Ps$647.7 million in Cash and
Cash Equivalents and Ps$93.0 million in Maxtel bonds, equivalent
to US$25 million face value), and Ps$369.2 million in Restricted
Cash at the end of 2Q01.

OTHER ANNOUNCEMENTS:

As of September 2001, Sebastian Valdez joined the Board of
Directors, as Series "N" Director, replacing Graeme Mills, who
held a seat on the Board since May 1998. Sebastian Valdez joined
BancBoston Capital in April 2000 as a Boston-based member of the
Latin American private equity team. He coordinates the efforts of
BancBoston Capital's offices in the region and is responsible for
Latin American transactions that involve the U.S. markets,
providing a pivotal role for the Latin American portfolio
companies in the United States. Prior to joining BancBoston
Capital, Mr. Valdez spent four years in the Leverage Finance
group of BancBoston Robertson Stephens, structuring and marketing
senior credit facilities and high yield bonds with a focus on the
high technology, media and communications, and energy industries.
Previously he was a Vice President at BankBoston's Precious
Metals division. He is a director of several Latin American
portfolio companies and a member of the Advisory Board of several
regional private equity investment funds.

On September 28, 2001, The Company filed an amendment to its 20-F
form before the Securities and Exchange Commission, to include
financial statements audited in conformity with U.S. GAAS instead
of Mexican GAAS.

To see company's financial statements:
http://www.bankrupt.com/misc/Maxcom.pdf


MAXCOM TELECOMUNICACIONES: Gets a Nationwide Telephony Concession
-----------------------------------------------------------------
Maxcom Telecomunicaciones, S.A. de C.V. announced it was recently
granted an amendment from the Mexican Telecommunications and
Transportation Ministry to extend its coverage into a nationwide
concession. Maxcom will define its strategy in expanding its
footprint, in the forthcoming months.


TRI-NATIONAL DEVELOPMENT: Mexican Properties Listed In Ch. 11
-------------------------------------------------------------
In its press release, Tri-National Development Corp. (OTCBB:TNAV)
announced Wednesday it filed a voluntary Chapter 11 bankruptcy
petition in the San Diego Bankruptcy Court.

The petition was accompanied by all of the schedules of Tri-
National's assets and debts, its statement of affairs and a list
of its shareholders.

According to the schedules, the current market value of Tri-
National's assets is approximately $86 million, while its debts,
both secured and unsecured, total approximately $33 million. The
reason for the filing is apparent from a reading of the
schedules: Tri-National has valuable, unencumbered land, but no
cash with which to satisfy the claims of its creditors.

Tri-National is a Wyoming corporation. Its principal business is
the acquisition and development of real property. Currently, its
principal real property holdings are located in the State of Baja
California Norte, Mexico. These real properties are owned by
several subsidiary Mexican corporations.

Michael A. Sunstein, president and chief executive officer of
Tri-National, said, "It is my intention to reorganize Tri-
National in the voluntary Chapter 11 case in quick order by
marketing assets owned by Tri-National's Mexican subsidiary
corporations, up-streaming the sale proceeds and using the
proceeds to pay creditors. We intend to work closely with our
creditors, and we expect to have a reorganization plan confirmed
and begin distributions to creditors in six months or less.

"The reorganization will be facilitated primarily by our wholly
owned and debt-free subsidiary, Planificacion Desarollos S.A. de
C.V. As detailed in the schedules, Planificacion owns, free and
clear of liens, 600 acres of land known as 'Hills of Bajamar.'
The Hills of Bajamar is approximately 50 miles south of the
U.S./Mexico border, located east of the toll road across from
Bajamar, a well known residential and golf development in the
Municipality of Ensenada. Planificacion has options to purchase
an additional 1,750 acres of Hills of Bajamar for $2,800 per
acre.

"Three hundred acres of the Hills of Bajamar property was
appraised by Cushman Wakefield in April 2001 and valued at
$23,333 per acre, as is. Since the appraisal, Tri-National has
acquired the additional entitlements, including sub-division
approval and permits to begin selling lots, thereby enhancing the
value of the property. We plan to immediately being marketing
lots in the sub-division. We believe, based on comparable
properties and sales in the area, that sufficient sales can be
generated in a relatively short amount of time to enable Tri-
National to pay its creditors in full.

"Also included in the schedules is the company's Mexican
subsidiary, Tri-National Holdings S.A. de C.V., which is owned
approximately 60 percent by Tri-National. Holdings owns two
parcels of real property located in Rosarito Beach, Baja
California Norte, Mexico: 187,500 square feet of commercial
shopping center space, which is roughly 80 percent built out, and
15 acres of undeveloped beachfront property. The shopping center
has been appraised by Cushman Wakefield and valued at $12.5
million as is. The Beachfront has also been appraised by Cushman
Wakefield and valued at $13 million as is. Both properties are
unencumbered, and Holdings is substantially debt-free. Thus, Tri-
National's interest in Holdings is worth over $15 million. We
look forward to the opportunity to realize the value of these
parcels as well, now that we are afforded the protection of the
Chapter 11 filing and the ability to proceed."

Tri-National is represented in its Chapter 11 case by Colin W.
Wied, who said: "This case is a classic example of the utility of
Chapter 11 of the Bankruptcy Code. If left to creditors, Tri-
National and its subsidiaries would be dismembered by a few
creditors, to the great detriment of other creditors and the
company's shareholders. The Bankruptcy Code's automatic stay
stops creditors from any further attacks against Tri-National or
its property. That gives Tri-National time to market its Hills of
Bajamar and other properties, distribute the sale proceeds to pay
its creditors in full, and preserve and enhance the value of its
stock for the benefit of its shareholders."

Tri-National Development Corp. is an international real estate
development, sales and management company focused on providing
affordable housing in the Baja region of Mexico and the
Southwestern U.S.

To see company's financial statements:
http://www.bankrupt.com/misc/TRI_NATIONAL.pdf

CONTACT:  Tri-National Development Corp.
          Jason Sunstein, 619/718-6370, Fax 619/718-6377
          jason@tri-national.com


TRI-NATIONAL DEVELOPMENT: Senior Care Extends Shareholder Tender
----------------------------------------------------------------
Senior Care Industries Inc. (OTCBB:SENC) announced Wednesday that
it has been informed that Tri-National Development Corp.
(OTCBB:TNAV) filed voluntary Chapter 11 in the United States
Bankruptcy Court in San Diego, Case No.01-10964-JH.

The case was assigned to the same judge who was hearing the
involuntary bankruptcy case that had been filed by a group of
creditors including Senior Care in August of this year. The case
will be heard by Judge John Hargrove.

The tender offer to Tri-National shareholders that was made by
Senior Care earlier this year was scheduled to expire on Oct. 31,
2001. Senior Care announced that the tender offer will now be
extended to Dec. 31, 2001.

Senior Care also announced that because of the bankruptcy filing,
it would accept only 51% of outstanding shares of Tri-National
and would refuse to purchase any shares above that percentage.

Senior Care said the primary reason for the extension was
twofold. First of all, Senior Care has received a second series
of comments from the Securities & Exchange Commission and is
presently in the process of responding to those comments on the
amended registration statement that was filed on Sept. 11, 2001.

Secondly, because the tender is hostile, Senior Care had been
unable to obtain information from Tri-National that is necessary
to respond to the SEC comments. Senior Care now hopes that the
information provided by the bankruptcy schedules will give it
sufficient information to be able to respond.

About Senior Care

Senior Care develops housing for seniors and is presently
developing 233 single family senior "smart homes" near Palm
Springs, Calif., 54 town houses in Las Vegas, and 56 apartments
for seniors at Senior Care's West Valley Apartment complex in New
Mexico. Sales of Senior Care's Evergreen Manor II condominium
project in Los Angeles have been brisk, according to management.

CONTACT:  Investor Relations Network
          Tom Gavin, 909/279-8884


VITRO SA: Reveals Options For Dealing With Bond Refinancing
-----------------------------------------------------------
Mexican glassmaker Vitro SA may issue a new foreign-denominated
bond, sell peso debt in the Mexican market and sell non-core
assets to refinance a $175 million bond coming due in May,
Bloomberg reported Wednesday.

"The key for us is to give the market the signal that we're
working rapidly, efficiently and focused on this refinancing,"
said Luis Nicolau, Vitro chief corporate officer.

According to Nicolau, Vitro has retained Salomon Smith Barney and
Credit Suisse First Boston to prepare a bond sale in case market
conditions improve enough to attract investors at a good price.

The company is also looking at selling peso-debt to refinance the
maturing bond and is talking with bankers to provide support. One
bank has committed $40 million toward refinancing the bond,
Nicolau said.

Another option is to raise cash by selling off companies. Vitro
has signed letters of intent to sell two "non-strategic assets"
for a "substantial amount," Nicolau said, without revealing how
much cash Vitro could get.

Furthermore, Vitro also has $35 million of commercial paper
maturing at the end of the year. But the company is confident it
can pay the paper with cash on hand and existing credit lines in
case investors are reluctant to renew the notes. The company had
$77 million of cash at the end of September.

Meanwhile, the management is urging its board of directors to
forgo a $17 million dividend payment at the end of this year,
which is the second installment on a $34 million dividend the
board had approved earlier in 2000. The board is scheduled to
meet Friday.

"We will make a recommendation to the board not to pay the
dividend and not to use the cash we have on hand as a means to
pay that dividend but rather as a means to satisfy our existing
obligations," Nicolau said.

CONTACT:  Vitro S.A. de C.V.
          Investor Relations:
          Gerardo Guajardo, 011 (52) 8329-1349
          gguajardo@vto.com
          Beatriz Martinez, 011 (52) 8329-1258
          bemartinez@vto.com
          or
          Breakstone & Ruth International
          U.S. contact:
          Luca Biondolillo, 646/536-7012
          Lbiondolillo@breakstoneruth.com
          Susan Borinelli, 646/536-7018
          Sborinelli@breakstoneruth.com
          or
          Vitro, S. A. de C.V.
          media:
          Albert Chico, 011 (52) 8329-1335
          achico@vto.com


VITRO SA: 3Q01 Unaudited Results; EBITDA Down, Debt Reduced
-----------------------------------------------------------

- Total outstanding debt reduced QoQ by US$31 million, and by
US$48 million since March 31, 2001

- Consolidated net sales maintain positive trend in dollar terms,
rising by 4.5% year-to-date driven by the performance of Flat
Glass, Glass Containers and Acros Whirlpool

- EBITDA for the quarter decreased YoY by 17.8% in dollar terms,
as a result of the economic market demand slowdown affecting the
United States and Mexican economies. Year-to-date, EBITDA
decreased by 6.6% when compared against last year

- Quarter over quarter debt decreased by US$31 mill. This
reduction was achieved by using internally generated funds. This
debt reduction, along with lower interest rates (which arise from
market conditions and company driven liability management
strategies), improved the Company's interest coverage to 3.4
times, the highest level in the last five years. Financial
leverage (Total Debt/EBITDA) stood at 3.0 times, slightly higher
than year end 2000's 2.9 times.

- Consolidated net sales for the third quarter of 2001 reached
US$763 million, representing an increase of 0.8% in dollar terms,
compared with US$757 million for the third quarter of 2000. Flat
Glass, Glass Containers and Acros Whirlpool were the main drivers
of Grupo Vitro's sales performance for the quarter. Year to date,
sales have increased 4.5% in dollar terms, which compares
favorably against the decrease of more than 3% for the Mexican
Economy Manufacturing Index. As a result of the strong peso and
lower prices in peso terms sales reached Ps$7,180 million,
representing a 4.3% decrease compared with Ps$7,506 million for
the third quarter of 2000.

- EBITDA declined 17.8% YoY for the third quarter in dollar
terms, as a result of pricing measures to strengthen our market
participation in some of the businesses, facing the market demand
slowdown of the U.S. and Mexican economies, and the additional
pressures on the world wide economic environment arising from the
September events in New York, and a less profitable product mix
being sold. Also, the strength of the peso kept affecting the
competitiveness of the Company's exports while promoting imports
into the domestic market. Additionally, lower production levels,
as a result of reduced demand, has resulted in an increase in the
proportion of fixed costs as a percentage of sales.
Notwithstanding the adverse environment existing in the Company's
principal markets, accumulated EBITDA for the year has decreased
6.6%.

- The Company posted a Net Majority Loss of US$59 million for the
quarter, which included non cash items arising from an exchange
loss of US$74 million and charges for approximately US$20 million
related to the sale of certain assets and the write off of
obsolete assets. Additionally, the Company made the second part
of a one time disbursement in the amount of US$17 million for
severance payments, resulting from the ongoing reorganization
program.

All figures provided in this communication are in accordance with
Generally Accepted Accounting Principles in Mexico. All figures
are unaudited and are presented in constant Mexican pesos as of
September 30, 2001. Dollar figures are in nominal US dollars and
are obtained by dividing nominal pesos for each month by the
applicable exchange rate as of the end of that month.

Consolidated Results

Sales

The positive YoY sales performance in U.S. dollar terms for the
third quarter was driven mainly by the businesses of Flat Glass,
Glass Containers and Acros Whirlpool. Similar to last quarter,
sales in peso terms at the Flat Glass unit remained practically
at the same level on a YoY basis, overcoming the pressure that a
strong peso puts on prices, increased imports and the reduced
demand as a result of the market demand slowdown of the U.S. and
Mexican economies. Flat Glass was able to increase sales in
dollar terms, which partly offset the aforementioned events,
mainly as a result of the consolidation of Cristalglass, its
European-based subsidiary. At Acros Whirlpool, volume increases
in the export markets were the main drivers for the growth in
sales, partially offsetting price pressures. For Glassware and
Diverse Industries, sales for the quarter decreased YoY, as
result of a decline in demand in the retail and industrial
sectors in connection with the aforementioned market slowdown of
the U.S. and Mexican economies, and, in the specific case of
Diverse Industries, as a consequence of the closing last year of
a Joint Venture with General Electric (MEF), which accounted for
approximately 5% of sales of this unit for the IIIQ'00; both
Glassware and Diverse Industries have improved their cash flow by
improving inventory turnaround. Notwithstanding this adverse
economic environment that has resulted in a decrease in the
Mexican Economy Manufacturing Index by more than 3% year to date,
the Company's efforts has yielded an increase by 4.5% in dollar
terms (and 1.8% decrease in peso terms for the year).

EBIT and EBITDA

YoY margins have continued to decline as a result of pricing
pressures to strengthen market participation in some of the
businesses, and a lower demand arising from the market demand
slowdown of the U.S. and Mexican economies, including the
additional pressures arising from the September events in New
York and a less profitable mix of products being sold. Also, the
strength of the peso, which has devalued YoY by 0.7% vs. an
annual inflation of 6.2%, kept on affecting the competitiveness
of the Mexican industry, while promoting imports into the
domestic market. Additionally, lower production levels, as a
result of a reduced demand has resulted in an increase in the
proportion of fixed costs as a percentage of sales.

Notwithstanding the adverse environment existing in the Company's
principal markets, accumulated EBITDA for the year has decreased
6.6%.

Total Financing Cost

Interest expense for the quarter has decreased due to a lower
weighted average cost of debt, which declined to 8.8%, from
10.4%, for IIIQ'00 as a result of lower market rates and the
Company's liability management strategies. The weighted average
cost of debt for fiscal 2000 was 10.3%. Currently, debt accruing
interest at fixed rates represents 42% of total debt of the
Company.

Due to the 4.8% devaluation of the peso during IIIQ'01, the
Company recorded a non-cash exchange loss for the period.
Overall, the Company recorded, for the quarter, a Total Financing
Cost of Ps$925 mill. (US$98 mill.), compared with a Total
Financing Gain of Ps$ 167 mill. (US$17 mill.) for the third
quarter of last year, when an appreciation of the peso favored a
foreign exchange gain. The event that produced the increase in
the total financing cost is a non-cash item.

Net Majority Income

Net Loss of Majority Interest for the quarter was Ps$554 mill.
(US$59 mill.), compared with a Net Majority Gain for IIIQ'00 of
Ps$265 mill. (US$27 mill.), mainly as a result of a considerable,
non-cash, exchange loss. The Other Income (expense) item shown,
includes severance payments made in connection with an ongoing
reorganization program and non-cash losses in connection with the
sale of certain assets and write-off of other obsolete assets.

Capital Expenditures

In the aggregate, CAPEX for 9M'01 remained flat when compared
with the same period last year. CAPEX for the quarter was mainly
used for maintenance and growth purposes in the same proportion.
CAPEX for the year is estimated to be of around US$ 100-110
mill., an amount that is 15% lower than the originally budgeted
US$ 120-130 million.

Financial Position

Quarter over quarter debt decreased by US$31 mill. This reduction
was achieved by using internally generated funds, notwithstanding
the payment of approximately US$17 mill. in severance payments
during the quarter, as part of the ongoing reorganization. This
debt reduction, along with lower interest rates, coupled with
Company-driven liability management strategies, improved the
Company's interest coverage to 3.4 times, the highest level in
the last five years. Financial leverage (Total Debt/EBITDA) stood
at 3.0 times, slightly higher than year end 2000's 2.9 times.

Debt Profile as of September 30, 2001

- 68% of debt is long-term
- Average life of debt is 2.9 years.
- 49% of debt maturing within the period October '01 - September
'02 is related to trade finance, which the Company regularly
renews (US$250 million).
- Current maturities of long-term debt include a maturity of
US$175 million on May '02 of a bond placed in the international
capital markets.
- Rate composition of Company's debt: fixed rate = 42%; floating
rate and fixed spread = 35%; short-term debt subject to market
conditions = 23%.

Cash Flow

Year over year, lower interest expense and better working capital
management, along with lower taxes and dividends paid, resulted
in a better net free cash flow position. Net free cash flow
during the quarter was used mainly for debt reduction, severance
payments as part of the ongoing corporate reorganization and a
US$10 mill. increase in the Balance Sheet's Cash and Cash
Equivalent line.

As a percentage of sales, working capital investments for IIIQ'01
were reduced to 11.2% from 13.2% for IIIQ'00.

Flat Glass

Sales

Sales during the quarter increased 3.5% in dollar terms and
decreased slightly in peso terms as a significant percentage of
the business' revenues are denominated in U.S. dollars. Year-to-
date, consolidated sales in dollar terms were up by 7.4%. During
the quarter, the economic market demand slowdown in the U.S. and
Mexican economies continued to affect demand and pressure prices.
The export market has been affected specially in the auto OEM
segment (20% of the unit's sales and 7% of the Company's sales),
in which several American auto plants have announced partial
shutdowns, as reflected in the YoY 6.3% decrease. Foreign
subsidiaries increased sales 9.9 % on a YoY basis, mainly driven
by Cristalglass. On a QoQ basis, volumes for construction
improved by 10.3%, mainly by exports to worldwide regions.

EBIT and EBITDA

EBIT and EBITDA margins for the quarter were affected YoY mainly
by a strong peso that promoted imports. Also, reduced demand has
increased price pressures. These events have affected the
Company's ability to absorb fixed costs and have continued to
pressure margins. To offset the foregoing on a QoQ basis EBIT and
EBITDA improved thanks to the integration of Cristalglass, the
Company's new subsidiary in Europe, acquired in May of this year.
The unit's management is focusing in improving operating
efficiencies and moving into a more profitable sales mix.

Acros Whirlpool

Sales

During the quarter, demand from the export market for products of
this business unit continued to increase despite the U.S.
economic downturn, specially in the refrigerator segment, since
Acros Whirlpool's export models represent a more affordable
option to the U.S. consumers. This trend helped offset the
slowdown in the domestic market orders for household appliances.
While year-to-date the accumulated Mexican Electric Appliance
Volume Index decreased YoY by 6.8%, Acros Whirlpool's domestic
volumes over the same period fell by only 0.6%.

EBIT and EBITDA

Profitability continued to be affected by pricing pressures,
mostly from Korean imports into the domestic market and reduced
domestic demand. Additionally, increased participation of dollar
denominated sales via exports has affected the sales mix and
reduced margins. The extraordinary costs resulting from modifying
the new range platform has also affected YoY comparisons.
Management of Acros Whirlpool is focusing in reducing costs by
improving efficiencies and leveraging on the completion of the
installation of the new platform for ranges.

Glass Containers
Sales

YoY sales increased by 0.6% in dollar terms and decreased by 4.3%
in pesos. The distribution company in the U.S., Vitro Packaging,
drove the YoY sales improvement by increasing sales in the U.S.
in general. On the domestic front, prices continue to be
pressured and efforts are being made to improve margins by
leveraging on operating efficiencies and moving to more
attractive niches.

EBIT and EBITDA

YoY EBIT continued to be affected by price pressures in the
domestic market. Additionally, extraordinary maintenance costs
and
technical expenses to adapt machinery for cosmetics and beer
premium
market quality requirements were made during the quarter.

Glassware

Sales

The decrease in consolidated net sales on a YoY basis continues
to be attributable to the decline in demand, primarily as a
consequence of the market demand slowdown of the U.S. and Mexican
economies. An increase in import products as a result of a strong
peso has also affected revenues in the domestic sector. However,
some segments have shown improvement, such as the candleholder
market and direct sales to niche markets. In the export market,
sales to the unit's joint venture partner, Libbey, experienced a
reduction as a result of a decline in demand for Libbey's
imported and manufactured products targeted to the hotel and
restaurant service industries, a sector which is currently
experiencing economic difficulties but that represent less than
1% of the Company's consolidated sales. Volumes for IIIQ'01
showed an increase of 12% over IIQ'01, but decreased YoY by 11%.
Glassware's management has been focusing on improving returns by
disposing of existing inventories, renewing its line of offered
products and improving operating efficiencies.

EBIT and EBITDA

EBIT increased QoQ by 28% driven by an improvement in margins of
280 basis points. The improvement was achieved mainly through
operation efficiencies, such as lesser packaging costs and
optimization in the usage of furnaces. On a YoY basis, EBIT
decreased by 34.1% mainly as a result of lower sales and higher
fixed costs as a percentage of sales. Management continues its
strategy of maintaining low inventories, in an effort to increase
cash flow generation.

Diverse Industries

Sales

Sales for the quarter decreased 8.2% in dollar terms, as a result
of the decline in demand by the retail sector: aluminum cans,
ampoules and plastics experienced a decrease in demand, due to
the market demand slowdown of the U.S. and Mexican economies. The
decrease in sales also include the effect of the closing of MEF,
the former joint venture with General Electric, on August 2000,
which represented 5% of the business sales for IIIQ'00. On the
other hand, the unit's chemical operations continue its positive
trend, posting strong sales results year-to-date.

EBIT and EBITDA

EBIT declined 32.2% on a YoY basis as a result mainly of lower
sales that have also resulted in a higher proportion of fixed
costs as a percentage of total sales.

Key Developments

SYNDICATED LOAN

Vitro, through its subsidiary Compa¤Ħa Vidriera, S.A. de C.V., as
borrower, executed during the quarter a credit facility providing
for new financing in an aggregate principal amount equal to
US$235 million. The facility was lead by HSBC and Citibank, and
included as participants Banco Nacional de Comercio Exterior, ABN
AMRO, Bank of Montreal, Banamex, Banca Nazionale de Lavoro,
JPMorgan-Chase and Credit Suisse First Boston. It exceeded the
Company's initial subscription efforts that aimed at US$200
million. The loan matures in five years and has an average life
of two and one-half years. Vitro will be paying a decreasing rate
of interest, which will start at Libor plus 225 basis points,
that the company considers advantageous taking into account
market conditions. Vitro used the proceeds of the facility to
refinance short-term holding company debt and debt of its
containers division. The facility is part of several measures
being taken by the company's management to reduce its cost of
funding, extend the tenor of its indebtedness and improve its
liability profile. It reflects the confidence that a core group
of lenders are placing on Vitro and its management.

REORGANIZATION UPDATE

As part of the effort to improve Grupo Vitro's performance and
competitiveness, Grupo Vitro reduced its corporate and
administrative staff by approximately 1000 employees, which
required approximately US$17 million in severance payments, and
is estimated to reflect annualized savings of approximately US$40
million. The payback arising from those severance payments is not
expected until the second part of next year. The severance
payments were disbursed during IIIQ'01.

As it was announced last quarter, Grupo Vitro will begin
consolidating into four business units starting in the month of
October 2001: Flat Glass, Glassware, Glass Containers and Acros
Whirlpool. Businesses considered of strategic importance within
the Diverse Industries unit, have been integrated into the four
remaining business units. The fiber glass business was integrated
into the Flat Glass unit, the plastic businesses were integrated
into the Glasware unit and the rest of the businesses within
Glass Containers.

DIVESTITURE PLAN UPDATE

As part of Grupo Vitro's plan to divest non-core businesses and
assets, the Company sold real estate and machinery for
approximately US$5 million during IIIQ'01. Additionally, an
executive aircraft was sold for an amount of US$4.2 million and
the lease of a second plane was assigned. Besides the
aforementioned cash proceeds such transactions will reduce costs
to the Company on an annualized basis in the amount of US$2.5
million. As of the end of September 2001, aggregate proceeds
received by Grupo Vitro from divestitures amounted to
approximately US$65 million.

Grupo Vitro has executed letters of intent for the sale of
certain businesses. Although the environment remains unfavorable
to complete those sales and there can be no assurances that such
sales will be completed, Vitro remains committed to divest non-
strategic assets.

To see company's financial statements:
http://www.bankrupt.com/misc/Vitro.pdf




===========
P A N A M A
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CHIQUITA BRANDS: Announces 3Q Results; Still Negotiating Debts
--------------------------------------------------------------
Chiquita Brands International, Inc. (NYSE: CQB) reported
Wednesday third quarter results as follows (in millions, except
per share amounts):
                                               Quarter Ended
                                               September 30,
                                             2001           2000

Earnings before interest, taxes,
  depreciation and amortization (EBITDA)    $27.7           $0.4
Earnings before interest and taxes (EBIT)     4.9          (23.7)
Loss before unusual items                   (26.5)         (51.9)
Loss per share before unusual items         (0.40)         (0.84)

Note: The above amounts are presented before 2001 unusual charges
of $12 million relating to the shutdown of certain farms in
Panama and parent company debt restructuring costs, and before a
$2 million extraordinary loss in 2000 from debt refinancing.

The improvement in third quarter results occurred in the
Company's Fresh Produce business primarily as a result of higher
pricing in European and North American markets. The benefit of
higher pricing more than offset the negative effect of weak
European currencies in relation to the U.S. dollar. The Company's
Processed Foods operating results declined primarily due to lower
market pricing for canned vegetables in the third quarter of
2001, when the industry was reducing inventory levels.

Net sales for the third quarter of 2001 increased $43 million to
$509 million primarily as a result of the higher pricing and, to
a lesser extent, higher volume in Fresh Produce.

The third quarter unusual charges include $9 million for the
closure of non-competitive farms that represented about 20% of
the Company's Armuelles, Panama, banana production division. The
Company has since reached agreement with the local labor union
regarding work practices in its remaining farms in Armuelles. The
new agreement should improve the quality, productivity and cost
performance of the remaining farms. However, additional
improvements will be needed in order for the remaining farms to
become cost-competitive in world markets.

Chiquita continues to make progress in negotiation with
bondholder committees regarding an initiative announced in
January to restructure the public debt of Chiquita Brands
International, Inc. ("CBII"), which is a parent holding company
without business operations of its own. The Company's operations
will continue as normal throughout the restructuring process,
which will neither involve nor affect the Company's operating
subsidiaries. The restructuring will include the conversion of a
significant portion of CBII's debt into common equity, which will
result in a substantial dilution of the interests of Chiquita's
common and preferred stockholders. If an agreement on such a
restructuring plan is reached, the Company would present the plan
for judicial approval under Chapter 11 of the U.S. Bankruptcy
Code, which provides for companies to reorganize and continue to
operate as going concerns. The Company is not currently in a
position to predict the outcome or timing of these negotiations.

Chiquita is a leading international marketer, producer and
distributor of quality fresh fruits and vegetables and processed
foods.

CONTACT:  James B. Riley,
          Senior Vice President and Chief Financial Officer,
          +1-513-784-6307,
          or William T. Sandstrom,
          Director of Investor Relations
          +1-513-784-6366, both of Chiquita Brands International

To see company's financial statement:
http://www.bankrupt.com/misc/Chiquita.pdf


CHIQUITA BRANDS: May Restructure Debt With Bankruptcy Protection
----------------------------------------------------------------
Steven Warshaw, chief executive at Chiquita Brands International
Inc., disclosed that the company is well advanced in its
negotiations with bondholders, Reuters reported Wednesday. Talks
could lead the company to file for bankruptcy protection, with a
restructuring plan that would give its debt holders a substantial
stake in the fresh fruit distributor.

In January, the Cincinnati-based company announced a plan to
restructure about $861 million of public debt after suffering
losses of more than $1.5 billion over eight years during a
dispute with the European Union over EU banana imports from
former European colonies. The dispute was resolved earlier in the
year.

The company, however, cannot predict the outcome or timing of the
negotiations between bondholders and its parent holding company,
which has no operations.

If an agreement was reached, Chiquita would seek court approval
of the plan under Chapter 11 of the U.S. Bankruptcy Code for
reorganization, the company said. The plan would substantially
dilute current shareholder equity, it added.

"We have set up plans for all alternatives, but we believe the
only plans that will be necessary is to complete the negotiations
that are already under way and to move forward in this
prearranged format that only includes the parent company,"
Warshaw said.

The parent company could still file a Chapter 11 petition without
an agreement, or wait to see if business continued to improve
with the trade dispute resolved, Warshaw said.

"What we were was a good company with a bad balance sheet and we
hope to become, through this process, a good company with a good
balance sheet," Warshaw said.

Chiquita said its units would continue normal operations
throughout the restructuring. The plan calls for converting a
significant part of Chiquita's debt into stock, which would
substantially dilute shares.



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P E R U
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AEROCONTINENTE: Chile's Investigation Stumped On Judge's Ruling
---------------------------------------------------------------
Peruvian judge David Loli issued an order to block AeroContinente
founder and owner Fernando Zevallos from leaving Peru, according
to an EFE report published Wednesday. During Tuesday's
proceedings, Judge Loli ordered Zevallos to pay a $14,000 bond
and froze $285,000 of his assets.

The judge determined that Zevallos had ties to ex-spy chief
Vladimiro Montesinos, who is being investigated on drug
trafficking allegations, in addition to numerous corruption
charges. Peru has not only guaranteed that Zevallos will appear
in court, but it has also frozen his assets, prosecutors have
said.

However, the Peruvian judge's ruling could hamper Chile's money
laundering probe of AeroContinente. Chilean justice officials
said the Peruvian judge's order and investigation confirms their
own case against the airline owner.

"His failure to appear in court in our country could damage the
case, as could the precautionary measures adopted against his
assets by the Peruvian legal system," State Defense Council (CDE)
President Clara Szczaranski said.

Chilean judges have questioned the founder of Peru's top airline
two times in the nation's money laundering investigation of the
airline. On July 18, Chilean authorities seized two
AeroContinente planes on the ground in Chile and arrested four of
its top executives. But a month later, Judge Victor Montiglio
dismissed the charges, released the executives and lifted the
restrictions imposed against the airline.


NUEVO MUNDO: Regulator To Name Repayment Overseer This Week
-----------------------------------------------------------
After releasing bidding rules over the weekend, Peru's banking
regulator was supposed to announce this week the winner of a
contract to oversee the repayment of US$40 million to depositors
of intervened bank Nuevo Mundo.

The regulator decided to liquidate Nuevo Mundo after potential
buyers withdrew over the prospect of a drawn out legal battle
between the regulator and the bank's majority shareholders.

Nuevo Mundo, together with fellow Peruvian bank NBK, were
intervened in December last year as a result of a run on deposits
sparked by the flight of former President Alberto Fujimori to
Japan.




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
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Information contained herein is obtained from sources believed to
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