/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/011220.mbx T R O U B L E D C O M P A N Y R E P O R T E R L A T I N A M E R I C A Thursday, December 20, 2001, Vol. 2, Issue 248 Headlines A R G E N T I N A ACINDAR: Shares Nose-Dive On Mounting Recession Concerns IMPSAT: Fails To Make Scheduled Bond Interest Payment GRUPO GALICIA: IMF Currency Comments Weigh On Shares B R A Z I L ACESITA: Ex-Finance Director To Become New Chairman In January CESP/LIGHT: Shares Up On Strengthening Currency EMBRAER: Gets A Boost With New Rolls-Royce Engine Deal TRANSBRASIL: Persuades Varig To Resume Passenger Services VARIG: Seals Leasing Deal With Boeing To Cut Debts C H I L E EDELNOR: Mirant Gets Three Takeover Offers For Its 82% Share H O N D U R A S GEOMAQUE EXPLORATIONS: Completes Debt Restructuring M E X I C O GRUPO IMSA: Obtains Syndicated Loan of US$380 Million HYLSA SA: S&P Lowers Debt Rating From CCC- To Selective Default HYLSAMEX: Shares Fall On Expectations Creditors May Shun Proposal SANLUIS: Shares Climb On Speculation Of Agreement With Creditors STARMEDIA NETWORK: Berger & Montague Files Securities Lawsuit STEWART ENTERPRISES: Q401 Net Down 31%, Selling Mexican Holdings P A R A G U A Y ANTELCO: Tariff, Subscription Hike Assures Buyer US$100M Yearly ANTELCO: Group Raps Two-Year Market Monopoly Given To New Owner V E N E Z U E L A SIDOR: Defaults On $31.3M Interest Payment for Bank Loans - - - - - - - - - - ================= A R G E N T I N A ================= ACINDAR: Shares Nose-Dive On Mounting Recession Concerns -------------------------------------------------------- Speculation among traders that Acindar may eventually succumb to Argentina's long recession sent the Argentine steelmaker's shares plummeting more than 24 percent on Tuesday. "There are many concerns that, if Argentina's recession deepens as forecast next year, and world steel prices being the way they are, Acindar may not last more than another couple of months," said Ruben Pasquali, a trader for Mayoral brokerage. Acindar shares on the Buenos Aires Stock Exchange were down 24 percent to a new 12-month low of 11.5 cents amid a flat overall session. The stock is down over 90 percent this year as the Company posted deepening net losses. Chief Executive Arturo Acevedo last month said that the Company had brought its losses under control through heavy cost cutting and increased exports. Argentina is in the fourth year of a deep recession that has particularly hammered the construction industry, upon which Acindar is very dependent for revenues. IMPSAT: Fails To Make Scheduled Bond Interest Payment ----------------------------------------------------- In an official statement, Impsat Fiber Networks, Inc. (NASDAQ: IMPT) ("Impsat" or "the Company") announced that it did not make its US$13.9 million interest payment due on December 17, 2001 on its 12 3/8 % Senior Notes due 2008. The decision to not make this payment is part of the cash preservation initiatives within the financial restructuring process Impsat undertook months ago. In its latest Form 10-Q filing with the Securities & Exchange Commission (SEC), the Company announced it was in discussions with certain creditors to find alternatives to restructure its balance sheet. As stated in previous communications, the Company has retained the investment banking firm Houlihan Lokey Howard & Zukin Capital to assist it in connection with its restructuring plan. Questions concerning the restructuring process should be directed to John McKenna or Lily Chu of Houlihan Lokey Howard & Zukin Capital at 212.497.4100. Impsat Fiber Networks, Inc. is a leading provider of fully integrated broadband data, Internet and voice telecommunications services in Latin America. Impsat has recently launched an extensive pan-Latin American high capacity broadband network in Brazil, Argentina, Chile and Colombia using advanced technologies, including IP/ATM switching, DWDM, and non-zero dispersion fiber optics. The Company has also deployed fourteen facilities to provide hosting services Impsat currently provides services to over 3,000 national and multinational companies, government entities and wholesale services to carriers, ISPs and other service providers throughout the region. The Company has local operations in Argentina, Colombia, Venezuela, Ecuador, Mexico, Brazil, the United States, Chile and Peru. Visit us at www.impsat.com. To see company's latest financial statement: http://www.bankrupt.com/misc/Impsat.doc CONTACT: Impsat Fiber Networks, Inc. Guillermo Jofre Gonzalo Alende Serra 54.11.5170.3700 www.impsat.com or Citigate Dewe Rogerson John McInerney 212/688-6840 GRUPO GALICIA: IMF Currency Comments Weigh On Shares ---------------------------------------------------- Shares of Grupo Financiero Galicia SA, the holding company for Argentina's third-largest bank, fell 2.33 percent to 42 centavos with $3 million shares traded, according to a report by Bloomberg. Galicia was hurt by comments from the IMF that Argentina may be forced to abandon its currency peg. A devaluation of the peso would hurt the bank because most of its loans are denominated in U.S. dollars, increasing chances that customers would default on their borrowings. =========== B R A Z I L =========== ACESITA: Ex-Finance Director To Become New Chairman In January -------------------------------------------------------------- Luiz Anibal de Lima Fernandes will be the new chairman of Acesita, the stainless steel manufacturer controlled by the Usinor group, beginning January. De Lima Fernandes was the Company's former finance director. Acesita was acquired by Usinor in 1998. Since then, the Company has undergone a process of technological, operational and financial restructuring. The process appears to have produced better results to the company. Although losses from January to September this year amounted to R$191 million compared to only R$50.5 million for the same period last year, the Company said its earnings in the third quarter rose by 22.9 percent to R$383.7 million. Acesita has so far recorded R$1 billion in net earnings, slightly over the R$997 million it had last year. Meanwhile, the Company is currently implementing a US$100-million plan to increase its capacity to 500,000 m tons per year. CESP/LIGHT: Shares Up On Strengthening Currency ------------------------------------------------- Shares of Brazilian electricity companies Cia. Energetica de Sao Paulo (CESP) and Light Servicos de Eletricidade SA soared as a strengthening currency decreases financing costs for companies with large debt levels, relates Bloomberg. The Brazilian real jumped 2.2 percent to 2.3050 reais per U.S. dollar, its strongest level since June 28. Cesp, Brazil's third-largest electricity generator, leaped 9.8 percent to 17.55 reais. About 80 percent of Cesp's $4 billion in debt is denominated in dollars. Power distributor Light, on the other hand, gained 4.2 percent to 118.80 reais. About 87 percent of Light's $2.8 billion in debt is denominated in dollars. "The reais strengthening today helps companies with large debts - - and Cesp has a lot of debt," said David Hurd, Latin America electricity analyst with Deutsche Banc Alex. Brown in Baltimore. EMBRAER: Gets A Boost With New Rolls-Royce Engine Deal ------------------------------------------------------ British aero-engine maker Rolls-Royce Plc inked a new contract for its AE 3007 engines with Brazilian aircraft manufacturer Embraer SA, reports Reuters. According to Rolls-Royce, the contract is worth a potential $500 million. Under the terms of the contract, Embraer will sell 25 of its twin-jet corporate aircraft to Chicago charter airline Indigo. Indigo has also taken options on an additional 50 of the jets, which are powered by AE 3007 engines. The deal provides a good boost to Embraer, which have had few opportunities to book new sales following the September attacks on the United States, which led to airlines around the world shedding capacity. TRANSBRASIL: Persuades Varig To Resume Passenger Services --------------------------------------------------------- Brazilian airline Transbrasil eventually managed to convince Varig and Rio Sul to resume boarding of its passengers, reports Jornal do Commercio. Varig and Rio Sul had previously cancelled the service rendered to Transbrasil, which since early December, had suspended its flights due to the lack of money to pay for the fuel. The airline owes more than R$11 million to BR Distribuidora, and it has asked for a loan worth R$15 million to purchase fuel. VARIG: Seals Leasing Deal With Boeing To Cut Debts -------------------------------------------------- Brazil's flagship airline Varig signed a leasing deal with aerospace firm Boeing Co. that will allow it to cut its total debt by a third, says Reuters. Varig, which hasn't made a profit since 1997, will sell two McDonnell Douglas MD-11s and four Boeing 737-300s to Boeing Capital Corp., which will lease them back to the carrier. Subsequently, Varig will cut its debt to US$830 million from US$1.2 billion, said Manuel Guedes, Varig's director of investor relations. "Debt reduction of this size changes completely our financial profile," said Ozires Silva, Varig's president. "These days most companies lease rather than own their own aircraft." The jets were bought originally in an agreement financed by Wilmington Trust Co. of the United States. Boeing will have the option in the future to acquire a stake in Varig. However, according to Daniel da Silva, Boeing's vice-president for Latin American sales, the option isn't being studied at the moment. "I think it's sensational," said Robert Booth, of Miami-based consultant Aviation Management Services. "The interest payment on their debt has been killing them and this certainly helps them to tidy up their balance sheet." Varig plans to keep trimming its debt to reach between $300 million and $400 million next year through other "creative solutions" like the deal with Boeing, said Guedes. "The sale of stakes in Varig or one of the 10 subsidiaries in the group is also among shareholders' plans, although nothing is proceeding right now," informed Guedes. Already burdened by rising costs, Varig was forced to announce the cost cuts and lay off 10 percent of its 17,500-member work force 10 days after the Sept. 11 attacks on the United States thrust the world aviation industry into crisis. ========= C H I L E ========= EDELNOR: Mirant Gets Three Takeover Offers For Its 82% Share ----------------------------------------------------------- U.S. energy marketer Mirant Corp. now has three takeover offers for its 82.3 percent stake in the debt-ridden Chilean power generator Edelnor. According to a report by Reuters, Chilean firm Del Sol Mercados Futuros informed Chile's securities regulator that it offered to pay $4.5 million for the purchase of Mirant's stake in Edelnor. The bid matches the revised offer made by Chile's Inversiones y Asesorias Titanium on Monday. Both Titanium's and Futuros' offers exceed by $1 the offer made on December 11 by another Chilean firm called Los Choros Power & Gas. Edelnor is one of the main power generators in northern Chile, where much of the country's huge copper mining industry is located. The 670- megawatt company has outstanding debt worth $340 million and liquidity problems, Mirant has said. In October, Mirant announced it was seeking buyers of Edelnor after U.S. power giant AES Corp. and Chile's Electroandina, owned by Tractebel and Chile's state-owned copper company Codelco, withdrew their competing bids. =============== H O N D U R A S =============== GEOMAQUE EXPLORATIONS: Completes Debt Restructuring --------------------------------------------------- In an official press release, Geomaque announced that it has reached an agreement with its principal lender, Resource Capital Fund II L.P. of Denver, Colorado ("RCF") to complete the restructuring of its credit and security arrangements with RCF under its agreement dated June 9, 2000. The key terms of the restructuring agreement are outlined below: Payments to RCF * Fixed payments totaling US$2,925,000 will be repaid quarterly over seven quarters commencing September 30, 2002. * Payments equal to 40% available net cash flow from the Vueltas del Rio Mine, after payment of the fixed payments to RCF and Sococo (as described below) will also be made on a quarterly basis commencing with the quarter ending September 30, 2002. These payments continue until such time as RCF shall have earned an amount sufficient to realize a 40% internal rate of return on the net advances as at September 30, 2001 of $2,925,000. * In addition, after the satisfaction of the above amounts, RCF shall receive a 10% Net Project Cash Flow Royalty Interest on the Vueltas del Rio Mine. Payments to Sococo de Costa Rica, S.A. ("Sococo") Sococo provides contract mining services to Geomaque Honduras' Vueltas del Rio mine, and is currently owed $1,685,000 for services performed prior to September 30, 2001. This amount will be paid quarterly over the 10 quarters commencing September 30, 2002. Additional Working Capital As part of its restructuring the Company has raised by way of a private placement of common shares an additional CDN$1,985,000 (equivalent to US$1,265,000) for working capital purposes as follows: * RCF and other investors including two significant institutional shareholders (collectively the "Subscribers") have agreed to subscribe for common shares of the Company at CDN $0.05 per share for gross proceeds of CDN $1,985,000 or US$1,265,000. A total of 39,700,000 common shares will be issued to the Subscribers in a private placement transaction, a portion of which will be subject to shareholder approval. Upon approval of the TSE, Geomaque will immediately issue 8,385,888 common shares for gross proceeds of CDN $419,294. The remaining funds will be held in escrow and 31,314,112 commons shares will be issued and the funds released from escrow upon obtaining shareholder approval. It is expected that an extraordinary general meeting of shareholders to approve this private placement will be held early in February. Board and Management Appointments In conjunction with the completion of the Restructuring Agreement, a new Board of Directors and senior management team have been appointed. Mr. John W. Hick will assume the role of President and CEO and become a member of the Board. Mr. Hick has held senior management positions with a number of mining companies and is a Director of several publicly-listed mining companies including Cambior Inc. and Rio Narcea Gold Mines. Mr. Mario Caron will assume the position of Vice-President, Operations and join the Board of Directors. Mr. Caron, a mining engineer, was a Vice-President of PriceWaterhouseCoopers Securities Inc. and a former President of Eden Roc Mineral Corp. In addition, Mr. Gordon Bogden and Mr. Bruce Higson-Smith will join the Board. Mr. Bogden is Managing Director of Beacon Group Advisors Inc., an M&A advisory group and is a former investment banking executive with Newcrest Capital Inc., N.M. Rothschild & Sons Canada Limited and CIBC Wood Gundy Securities Inc. Mr. Higson-Smith, a mining engineer, is a Vice-President of Resource Capital Funds. Mr. Hick stated: "With the restructuring complete and the addition of new working capital the new Board and management group will be able to focus on the optimization of the Vueltas del Rio asset so that the mine can achieve its full potential and provide value to the Geomaque shareholders". To see company's financial statements: http://www.bankrupt.com/misc/Geomaque_Explorations.pdf For further information please contact: John Hick President and CEO (416) 956-7470 =========== M E X I C O =========== GRUPO IMSA: Obtains Syndicated Loan of US$380 Million ----------------------------------------------------- Grupo IMSA (BMV:IMSA) (NYSE:IMY), announced Tuesday that it has obtained a long-term syndicated loan for US$380 million. This transaction has allowed the Company to modify the contract of an already-existing debt with an outstanding amount of US$231 million to obtain a lower interest rate, and to acquire new resources of US$149 million to be used principally to refinance short-term debt. The transaction improves Grupo IMSA's debt profile by extending its average life without increasing total indebtedness. Grupo IMSA used the additional resources from this syndicated loan to pay off debt that had been incurred to complete the acquisition of VP Buildings in October and other short-term debt. The reduction in interest rate will result in a significant lowering of the Company's financial expense. The success of this transaction reflects Grupo IMSA's good results and the efforts over the last five quarters to strengthen the Company's financial position. The syndicated loan was divided into three tranches: the first for US$120 million with a two-year maturity; the second for US$150 million with a four-year maturity; and the third for US$110 million with a five-year maturity. The lead arranger of the transaction was Salomon Smith Barney -- Citibank, N.A., and the syndicate was made up of: BankBoston, N.A., Wachovia Bank, N.A., BNP Paribas and JP Morgan Chase Bank, as arrangers, with ten other banks as participants. Marcelo Canales, CFO of Grupo IMSA, said, "The syndicated loan transaction was very successful, and we even obtained a subscription in excess of the US$380 million that we had requested. This is a very significant achievement, especially if we consider today's difficult global environment. It is further proof of the confidence that our business model inspires, a model that has traditionally allowed us to overcome economic downturns; it also reflects the respect that we have always shown to our creditors." Mr. Canales added, "We have achieved two objectives with this transaction: reducing the cost of our long-term debt and refinancing our short-term debt, in this way, significantly improving the Company's debt profile." CONTACT: Grupo IMSA, Monterrey Jose Luis Fornelli, 011 (52) 8153-8416 jfornell@grupoimsa.com HYLSA SA: S&P Lowers Debt Rating From CCC- To Selective Default --------------------------------------------------------------- Standard & Poor's downgraded Hylsa SA's debt rating to a selective default-rating "SD" from "CCC-," which was already nine levels below investment grade, reports Bloomberg. The cut in the ratings is the second time in three months following the Company's announcement of a restructuring plan for its bank debt. "The downgrade is based on the Mexican steelmaker's non-payment of scheduled interest and principal payments, announced as part of the proposal for the restructuring of its total outstanding bank debt," S&P said in a statement. Those payments won't resume until a refinancing transaction is completed, which could be at the end of February, S&P said. Hylsa, a unit of steelmaker Hylsamex SA, is expected to continue paying interest and principal on its $300 million bond due in 2007, $73 million of inflation-adjusted bonds maturing in 2005 and debt from Bancomext, Mexico's export-import bank. S&P also downgraded the 2007 bond to "CCC+" from "CC." "There is significant uncertainty as to whether Hylsa will require a broader financial restructuring than is currently contemplated," S&P said. S&P last downgraded Hylsa's debt in September. HYLSAMEX: Shares Fall On Expectations Creditors May Shun Proposal ----------------------------------------------------------------- Hylsamex SA shares tumble 24 centavos, or 4.3 percent, to 5.4 pesos on concern that bank creditors may reject the steel-making subsidiary of Alfa SA's restructuring proposal, says Bloomberg. Hylsamex presented to a steering committee of bank creditors last week a proposal to divide $627 million of bank loans into two packages with longer maturities and a grace period on interest payments to allow the company to recover from slumping steel demand and prices. SANLUIS: Shares Climb On Speculation Of Agreement With Creditors ---------------------------------------------------------------- Shares of auto parts maker and mining company Sanluis Corporacion SA rose 35 centavos, or 5.8 percent, to 6.4 pesos, according to a report by Bloomberg. The Company's shares have risen 63 percent in the last two weeks. "It seems to point to an agreement with creditors, but there's no evidence of such an agreement," said Francisco Suarez, an analyst with Casa de Bolsa Banorte SA in Mexico City. Sanluis fell into default in September and is now in talks with a group of creditors led by J.P. Morgan Chase & Co. to postpone debt payments on $200 million in debt to avoid a shutdown until demand for auto parts recovers. The Company is betting on a turnaround in the U.S. auto-parts market. Some economists are predicting the better economic environment could come in the first half of next year which may help Sanluis pull out of the current slump and pay back its debt in full. To see company's financial statements: http://www.bankrupt.com/misc/Sanluis.pdf STARMEDIA NETWORK: Berger & Montague Files Securities Lawsuit ------------------------------------------------------------- The law firm of Berger & Montague, P.C., ( http://www.bm.net)filed a class action suit on behalf of an investor against StarMedia Network, Inc. ("StarMedia" or the "Company") (NASDAQ:STRME) and its principal officers and directors in the United States District Court for the Southern District of New York on behalf of all persons or entities who purchased StarMedia stock during the Class Period from April 11, 2000 through November 19, 2001. The complaint charges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, by issuing a series of material misrepresentations to the market between April 11, 2000 and November 19, 2001 concerning the Company's financial performance. The complaint alleges that Starmedia reported artificially inflated financial results in press releases and filings made with the SEC by improperly recognizing revenue in violation of Generally Accepted Accounting Principles ("GAAP"). Specifically, the complaint alleges that two of the Company's primary subsidiaries, AdNet S.A. de C.V. and StarMedia Mexico, S.A. de C.V, had engaged in improper accounting practices which had the effect of materially overstating StarMedia's reported revenues and earnings by at least $10 million. On November 19, 2001, as alleged in the complaint, Starmedia issued a press release announcing that based on the "preliminary" results of an internal investigation into its accounting practices, it expects to restate its financial statements for fiscal year 2000 and the first two quarters of 2001 and that those financial statements should not be relied upon. The Company further reported that its Chief Financial Officer had "resigned." Immediately following the announcement of the restatement, the NASDAQ Stock Market halted trading in StarMedia stock, pending the receipt of additional information from the Company. StarMedia stock last traded at $0.38 per share, which is 98.5% less than the Class Period high of $25.50, reached on April 11, 2000. If you purchased StarMedia common stock during the period from April 11, 2000 through November 19, 2001, inclusive, you may, no later than January 21, 2002 move to be appointed as a Lead Plaintiff. A Lead Plaintiff is a representative party that acts on behalf of other class members in directing the litigation. The Private Securities Litigation Reform Act of 1995 directs Courts to assume that the class member(s) with the "largest financial interest" in the outcome of the case will best serve the class in this capacity. Courts have discretion in determining which class members(s) have the "largest financial interest," and have appointed Lead Plaintiffs with substantial losses in both absolute terms and as a percentage of their net worth. If you have sustained substantial losses in StarMedia common stock during the Class Period, please contact Berger & Montague, P.C. at investorprotect@bm.net for a more thorough explanation of the Lead Plaintiff selection process. The law firm of Berger & Montague, P.C. has over 50 attorneys, all of whom represent plaintiffs in complex litigation. The Berger firm has extensive experience representing plaintiffs in class action securities litigation and has played lead roles in major cases over the past 25 years which have resulted in recoveries of several billion dollars to investors. The firm is currently representing investors as lead counsel in actions against Rite Aid, Sotheby's, Waste Management, Inc., Sunbeam, Boston Chicken and IKON Office Solutions, Inc. The standing of Berger & Montague, P.C. in successfully conducting major securities and antitrust litigation has been recognized by numerous courts. For example: "Class counsel did a remarkable job in representing the class interests." In Re: IKON Offices Solutions Securities Litigation. Civil Action No. 98-4286(E.D.Pa.) (partial settlement for $111 million approved May, 2000). "...[Y]ou have acted the way lawyers at their best ought to act. And I have had a lot of cases...in 15 years now as a judge and I cannot recall a significant case where I felt people were better represented than they are here ... I would say this has been the best representation that I have seen." In Re: Waste Management, Inc. Securities Litigation, Civil Action No. 97-C 7709 (N.D. Ill.) (settled in 1999 for $220 million). If you purchased StarMedia securities during the Class Period, or have any questions concerning this notice or your rights with respect to this matter, please contact: Sherrie R. Savett, Esquire Douglas M. Risen, Esquire Kimberly A. Walker, Investor Relations Manager Berger & Montague, P.C. 1622 Locust Street Philadelphia, PA 19103 Phone: 888/891-2289 or 215/875-3000 Fax: 215/875-5715 Website: www.bm.net e-mail: InvestorProtect@bm.net CONTACT: Berger & Montague, P.C. Sherrie R. Savett, Esquire Douglas M. Risen, Esquire Kimberly A. Walker, Investor Relations Manager 888/891-2289 or 215/875-3000 Fax: 215/875-5715 InvestorProtect@bm.net STEWART ENTERPRISES: Q401 Net Down 31%, Selling Mexican Holdings ---------------------------------------------------------------- Stewart Enterprises, Inc. (Nasdaq NMS:STEI) announced Tuesday its results for the fourth quarter and fiscal year 2001. The Company implemented the Securities and Exchange Commission's Staff Accounting Bulletin No. 101, "Revenue Recognition in Financial Statements" ("SAB 101") in the first quarter of fiscal year 2001, which resulted in changes to its methods of accounting for some of its preneed sales activities. For a detailed description of the effects of the implementation of SAB 101, see Note 2 of the Company's Form 10-Q for the quarter ended July 31, 2001 and Form 8-K dated March 14, 2001. For purposes of comparability, unless stated otherwise, all 2000 results described herein are presented on a pro forma basis to reflect the 2001 change in accounting methods as if it had been implemented at the beginning of fiscal year 2000, and the results for fiscal year 2001 are presented exclusive of the loss on assets held for sale and other charges, the early extinguishment of debt and the cumulative effect of the accounting change relating to the adoption of SAB 101 as reported in the third quarter of 2001. The Company announced that earnings for the fourth quarter and fiscal year ended October 31, 2001, were $7.3 million and $51.9 million, or $0.07 and $0.48 per share, respectively, compared to pro forma earnings of $9.9 million and $57.4 million, or $0.09 and $0.54 per share, respectively, for the fourth quarter and fiscal year of 2000. Including the previously announced nonrecurring, noncash charges and the cumulative effect of the change in accounting principles, the net loss for fiscal year 2001 was $408.7 million or $3.81 per share. Once the Company adopted a plan for the sale of its foreign and certain small domestic operations during the third quarter of 2001, it began segregating the operating results of these businesses from the operations it will retain. The following discussion and the supplemental schedules included in this press release segregate the financial results into two categories in order to present the Company's ongoing operating results and to provide more comparable information for investors. The Company's "operations to be retained" consist of those businesses it has owned and operated for all of this fiscal year and last and which are not for sale ("existing operations") plus those businesses that have been acquired or opened during this fiscal year or last ("acquired/opened operations"). "Closed and held for sale operations" consist of those that have been sold or closed during this fiscal year or last and the businesses that are currently being sold or offered for sale. Total funeral revenues for the fourth quarter and fiscal year ended October 31, 2001 were $92.3 million and $410.3 million, respectively, compared to pro forma funeral revenues of $101.1 million and $425.6 million, respectively, for 2000. Total funeral revenues from the Company's operations to be retained were $72.5 million compared to pro forma $69.3 million in the fourth quarter of 2000, and through twelve months, funeral revenues from operations to be retained were $297.3 million compared to pro forma revenues of $289.5 million for 2000. This increase in funeral revenue from the Company's operations to be retained is partially due to an increase in the average revenue per funeral call of 4.5 percent for the quarter and 1.4 percent for the year and an increase in the number of funeral calls performed by these businesses of 0.9 percent and 1.1 percent for the quarter and year. The average revenue per funeral call for the Company's existing funeral operations increased 4.8 percent for the quarter and 1.7 percent for the year, and the number of funeral calls performed by these operations decreased 1.2 percent for the quarter and year-to-date. About 40 percent of the decline in the number of events performed by our existing operations was attributable to a decline in low-end calls that the Company stopped performing. Excluding these low-end calls, the Company's existing funeral homes declined less than one percent, or one to two funerals per location. The cremation rate for the Company's existing operations was 37.6 percent for the quarter and 37.9 percent for the year. Total cemetery revenues for the fourth quarter and fiscal year ended October 31, 2001 were $61.3 million and $256.7 million, respectively, compared to pro forma cemetery revenues of $68.6 million and $287.8 million, respectively, for 2000. Total cemetery revenues from the Company's operations to be retained were $60.2 million compared to pro forma $66.6 million in the fourth quarter of 2000, and for the year, cemetery revenues from operations to be retained were $248.4 million compared to pro forma revenues of $274.7 million for the fiscal year ended 2000. Brian J. Marlowe, Chief Operating Officer, commented, "Prior to September 11th, we were at about 98 percent of our expectations with regard to domestic preneed sales, and even with all of the emotions and changes that this event brought with it, we were able to finish the year at about 97 percent of where we expected to be. We are pleased with the results from our preneed sales organization." For the fourth quarter and fiscal year ended October 31, 2001, the overall gross margins from the Company's operations to be retained were 23.3 percent and 24.9 percent, respectively, compared to pro forma 21.9 percent and 25.3 percent, respectively, for 2000. For the fourth quarter and fiscal year ended October 31, 2001, the funeral margins from the Company's operations to be retained were 24.4 percent and 24.2 percent, respectively, compared to pro forma 23.3 percent and 27.7 percent, respectively, for 2000. The quarter margins improved due to the above-mentioned increases in the number of calls and average revenue and to the close management of funeral costs. Year-to-date margins for the current period include an increase in costs due to the Archdiocese properties, which were not open for a full period in the prior year, upward pressure on the Company's funeral costs, including labor costs, and an increase in overhead costs allocated to the funeral segment. The Company allocates common overhead costs between its segments based on revenue. Due to the Company's moderation in preneed cemetery sales, the allocation has shifted a higher percentage of those costs to the funeral segment and a corresponding lower percentage to the cemetery segment. For the fourth quarter and fiscal year ended October 31, 2001, the cemetery margins from the Company's operations to be retained were 22.0 percent and 25.7 percent, respectively, compared to pro forma 20.5 percent and 22.8 percent, respectively, for 2000. The quarter and year-to-date margins for the current period were impacted by a decline in costs due to a reduction in cemetery overhead and sales support and a reduction in the common overhead allocation as mentioned in the funeral segment discussion above. For the quarter, EBITDA (defined as earnings before gross interest expense, taxes, depreciation and amortization) was $49.2 million compared to pro forma $50.0 million for the fourth quarter last year. Interest expense, net, in the fourth quarter of 2001 includes gross interest expense of $18.4 million partially offset by interest income of $0.4 million compared to $15.2 million offset by $2.4 million of interest income in the fourth quarter of 2000. Gross interest expense increased due principally to an approximate 300 basis point increase in our average interest rate, partially offset by a $193.8 million decrease in the average outstanding debt. Depreciation and amortization was $19.1 million for the fourth quarter of both 2001 and 2000. For the fiscal year ended October 31, 2001, EBITDA was $224.7 million compared to pro forma $229.4 million for the comparable period of last year. Interest expense, net, includes gross interest expense of $63.6 million offset by interest income of $5.2 million compared to $61.4 million offset by $5.1 million of interest income in fiscal year 2000. Gross interest expense increased due principally to a 100 basis point increase in the average interest rate, partially offset by a $114.5 million decrease in the average debt outstanding. Depreciation and amortization was $79.2 million compared to $77.5 million for the prior year. Although not required to implement Statement of Financial Accounting Standards ("SFAS") No. 142, "Goodwill and Other Intangible Assets," until the first quarter of fiscal year 2003, the Company intends to implement it in the first quarter of 2002. The Company has not completed its review and analysis and has disclosed in its July 31, 2001 Form 10-Q its preliminary estimate that it would incur a pre-tax, noncash impairment charge between $100 million and $300 million upon adoption. The Company now believes that it is more likely that the charge will be at the low end of that range. Upon the implementation of SFAS No. 142, goodwill will no longer be amortized. In fiscal 2001, domestic amortization of goodwill was $14.4 million. The Company announced that it generated $117 million in cash flow from operations and $100 million in free cash flow (defined as cash flow from operations less maintenance capital expenditures) during the fiscal year ended October 31, 2001. William E. Rowe, President and Chief Executive Officer, stated, "As we have reported in the past, we continue to focus on cash flow. To demonstrate that, in fiscal year 2001, we generated $100 million in free cash flow. This compares with $53 million in 2000 and negative $14 million in 1999." In August 2001, the Company announced the sale of its foreign operations in Mexico, Australia and New Zealand. Today, the Company is announcing that it has entered into a binding contract for the sale of its Southern European operations and that it has sold its Northern European operations. In total, these transactions have or will generate proceeds, including future tax benefits, none of which have been realized to date, of $150 to $160 million of the $200 to $250 million in total proceeds that the Company expects to receive from the sale of all foreign operations. All proceeds related to the sale of its foreign operations either have been or will be used to repay debt. The Company continues to have active discussions for the sale of its remaining foreign operations in Canada and Argentina and expects to complete these sales during 2002. Additionally, the Company has realized the $20 million in proceeds that it originally estimated for the sale of excess cemetery property, real estate and under-performing assets and anticipates another $5 to $10 million in 2002. Mr. Rowe added, "We are very pleased to report substantial progress in our debt reduction initiatives. In total, we have reduced our debt by over a quarter of a billion dollars this fiscal year and ended the year with about $690 million in debt. Our goal is to return debt levels to about $500 million or about 2.5 times domestic EBITDA. We expect to achieve that goal by the second quarter of 2003 by further reducing debt in an amount of approximately $140 to $150 million with the estimated proceeds from the sale of our remaining foreign operations plus future tax benefits associated with closed and prospective sales and with an additional amount of about $50 to $55 million a year in free cash flow. All tax benefits are expected to be realized in 2002 and 2003. Once we achieve our debt goal, we intend to focus on growing revenues and earnings through business expansion initiatives using internally generated free cash flow." In fiscal year 2002, the Company expects to achieve earnings of $0.38 to $0.42 per share and cash flow from operations between $60 and $70 million. The details of the Company's guidance are included in this press release along with the principal factors expected to contribute to the changes from 2001 to 2002. Mr. Marlowe commented, "In 2002, we expect to be positioning the Company for business expansion in 2003. We will be exploring several growth opportunities which will be funded out of future free cash flow, including additional combination funeral homes, operating partnerships, alternative service firms and other free- standing funeral home businesses. And, once our debt target of $500 million is achieved, we will be in a position to consider purchasing high-quality firms." Mr. Rowe concluded, "We began the year with a commitment to our shareholders that we would focus on cash flow, pursue the sale of our foreign operations, reduce and restructure our debt and focus on the operation of our core businesses, and we have done that. We exceeded our own expectations as we nearly doubled the free cash flow generated last year. We announced substantial progress with regard to the sale of operations in eight of the ten foreign countries in which we operated. We completely restructured our debt and reduced the amount maturing over the next two years by over $600 million by pushing out the maturities four to seven years. We are proud of our financial results for the quarter and year including the results of our funeral operations to be retained and the cost savings achieved in our cemetery businesses. During fiscal year 2002, we plan to position our Company to use future free cash to grow our revenues and our earnings. We are all very excited about what the future holds for Stewart Enterprises, and we are proud of the significant accomplishments that have been achieved this year." COMPANY FORECASTS FOR FISCAL YEAR 2002 The forecasts included herein were prepared by the Company's management for the purpose of providing all investors with forward-looking financial information frequently sought by the investment community. The forecasts have not been audited or otherwise approved by our independent accountants or by any regulatory authority. Accuracy of the forecasts is dependent on assumptions about events that change over time and is thus susceptible to periodic change based on actual experience and new developments. The Company cautions readers that it assumes no obligation to update or publicly release any revisions to the forecasts made herein and, except to the extent required by applicable law, does not intend to update or otherwise revise the forecasts more frequently than quarterly. The forecasts are based on a variety of estimates and assumptions made by management of the Company with respect to, among other things, industry performance; general economic, market, industry and interest rate conditions; preneed and at-need sales activities and trends; fluctuations in cost of goods sold and other expenses; capital expenditures; and other matters that cannot be accurately predicted, may not be realized and are subject to significant business, economic and competitive uncertainties, all of which are difficult to predict and many of which are beyond the Company's control. Accordingly, there can be no assurance that the assumptions made in preparing the forecasts will prove accurate, and actual results may vary materially from those contained in the forecasts. More specific information about factors that could cause actual results to differ materially from these forecasts is included herein. For these reasons, the forecasts should not be regarded as an accurate prediction of future results, but only of results that may be obtained if substantially all of management's principal expectations are realized. The Company does not represent or warrant, and assumes no responsibility for, the completeness, accuracy or reliability of the forecasts. COMPANY NOTES TO FORECASTS FOR FISCAL YEAR 2002 The Company expects several factors to cause variances to earnings and cash flow for fiscal year 2002 as compared to fiscal year 2001, including the following: the sale of the Company's foreign operations, the debt refinancing that occurred on June 29, 2001 resulting in increased borrowing costs, the anticipated implementation of Statement of Financial Accounting Standards No. 142 (SFAS No. 142) which will eliminate the amortization of goodwill, the expected internal growth from existing operations and other non-recurring items that occurred in 2001. The estimated anticipated impact of these factors on earnings is summarized below: Estimated Earnings Impact in Fiscal Year 2002 ---------------------------------------------------------------- In August 2001, the Company announced the sale of its foreign operations in Mexico, Australia and New Zealand. Today, the Company announced that it has entered into a binding contract for the sale of its Southern European operations and that it has sold its Northern European operations. In total, these transactions have generated or will generate proceeds, including future tax benefits, none of which have been realized to date, of $150 to $160 million of the $200 to $250 million in total proceeds that the Company expects to receive from the sale of all foreign operations. All proceeds related to the sale of its foreign operations either have been or will be used to repay debt. The Company expects to complete the sale of its remaining foreign operations in Canada and Argentina during 2002. All tax benefits are expected to be realized in 2002 and 2003. The reduction in operating earnings from the sale of the Company's foreign operations is expected to be substantially offset by the interest expense savings resulting from the proceeds from these sales used to reduce the Company's average debt balance. The impact, net of interest savings, in earnings before taxes resulting from the sale of foreign operations is projected to be approximately ($2 million) The Company expects to benefit from the elimination of foreign goodwill amortization resulting from the impairment charge recorded in the third quarter of 2001. The impact in before-tax earnings is expected to be approximately $1 million The Company expects interest expense to increase due to the Company's refinancing completed on June 29, 2001, which increased the Company's average borrowing rate by about 300 basis points. This increase in the average interest rate is expected to be partially offset by a reduction of the Company's average debt balance, when compared to fiscal year 2001, due to the use of the Company's free cash flow to repay debt. The decrease in interest expense resulting from the application of the foreign asset sales proceeds to repay debt is included above in determining the net impact of foreign asset sales. Accordingly, the projected increase in interest expense, excluding the interest expense savings from the sale of foreign assets, is expected to impact before-tax earnings by approximately ($18 million) The Company intends to adopt SFAS No. 142 effective November 1, 2001, and expects to benefit from the elimination of domestic goodwill amortization for fiscal year 2002, resulting in an impact in before-tax earnings over 2001 of approximately $14 million During fiscal year 2001, the Company benefited from nonrecurring net gains related to the sale of excess cemetery property, funeral home real estate and other assets. Additionally, the Company expects the yield on the assets in its perpetual care trust fund to be below that achieved in fiscal year 2001. The adjustment for these items in fiscal year 2002 is estimated to impact before-tax earnings as compared to 2001 by approximately ($9 million) Domestic revenue is expected to grow 2 to 3 percent, domestic costs are expected to grow 1 to 2 percent, and funeral calls are expected to remain flat. Based on these assumptions, the Company expects to achieve internal growth in its domestic before-tax earnings Up to of $4 million Principally due to the disposition of its foreign assets and the implementation of SFAS No. 142, the Company's tax rate is projected to increase to approximately 38 percent, which is expected to impact net earnings by about ($1 million) Projected fiscal year 2002 earnings per share $0.38 to $0.42 The estimated impact of these factors on cash flow is summarized below: Estimated Cash Flow Impact in Fiscal Year 2002 ---------------------------------------------------------------- In fiscal year 2001, the Company realized cash benefits from several nonrecurring tax items such as a federal tax refund, a reduction in 2001 estimated tax payments, a refund of certain state tax payments made in fiscal year 2000 and repayment from the funeral trust fund for tax payments made on behalf of the trust. The cash flow impact on 2002 as compared to 2001 from these non-recurring tax transactions in 2001 is approximately ($20 million) The cash flow impact on 2002 as compared to 2001 from the proceeds received in 2001 from the sale of excess cemetery property, funeral home real estate and other assets is approximately ($12 million) Interest expenditures are expected to increase due to an increase in the Company's average borrowing rate subsequent to the June 29, 2001 debt refinancing, partially offset by a reduction in the Company's average debt balance compared to fiscal year 2001. As a result, the Company expects to pay additional interest after taxes which is expected to impact cash flow by approximately ($11 million) Projected fiscal year 2002 cash flow from $60 to $70 operations million Projected fiscal year 2002 free cash flow (cash flow from operations less maintenance $50 to $55 capital expenditures) million For the purposes of the forecasts included herein, "EBITDA" is defined as earnings before gross interest, taxes, depreciation and amortization. EBITDA is a widely accepted financial indicator of a company's ability to service and/or incur indebtedness. However, EBITDA is not a financial measure determined under accounting principles generally accepted in the United States of America and should not be considered as an alternative to net income as a measure of operating results or to cash flows from operating activities as a measure of funds available for discretionary or other liquidity purposes. CAUTIONARY STATEMENTS The forecasts included herein are forward-looking statements that involve a number of risks, uncertainties and assumptions, including: The Company may experience declines in preneed sales due to numerous factors including changes made to contract terms and sales force compensation, or a weakening economy. Declines in preneed sales would reduce the Company's backlog and revenue and could reduce its future market share. In an effort to increase cash flow, the Company modified its preneed sales strategies early in fiscal year 2000 by increasing finance charges, requiring larger down payments and shortening installment payment terms. Later in fiscal year 2000, the Company changed the compensation structure for its preneed sales force. These changes, and the accompanying sales force attrition and adverse impact on sales force morale, caused preneed sales to decline. Although the Company does not anticipate making further significant changes in these areas, it may decide that further adjustments are advisable, which could cause additional declines in preneed sales. In addition, a weakening economy that causes customers to have less discretionary income could cause a decline in preneed sales. Declines in preneed cemetery property sales would reduce current revenue, and declines in other preneed sales would reduce the Company's backlog and future revenue and could reduce future market share. Increased preneed sales may have a negative impact on cash flow. Preneed sales of cemetery property and funeral and cemetery products and services are generally cash flow negative initially, primarily due to the commissions paid on the sale, the portion of the sales proceeds required to be placed into trust and the terms of the particular contract (such as the size of the down payment required and the length of the contract). In fiscal year 2000, the Company changed the terms and conditions of preneed sales contracts and commissions and moderated its preneed sales effort in order to reduce the initial negative impact on cash flow. Nevertheless, the Company will continue to invest a significant portion of cash flow in preneed acquisition costs, which reduces cash flow available for other activities, and, to the extent preneed activities are increased, cash flow will be further reduced, and the Company's ability to service debt could be adversely affected. Price competition could reduce market share or cause the Company to reduce prices to retain or recapture market share, either of which could reduce revenues and margins. The Company's funeral home and cemetery operations generally face intense competition in local markets that typically are served by numerous funeral homes and cemetery firms. The Company has historically experienced price competition primarily from independent funeral home and cemetery operators, and from monument dealers, casket retailers, low-cost funeral providers and other non-traditional providers of services or products. In the past, this price competition has resulted in losing market share in some markets. In other markets, the Company has had to reduce prices and thereby profit margins in order to retain or recapture market share. In addition, because of competition from these types of competitors in some key markets, in fiscal year 1999 the Company lowered its goals for increases in average revenue per funeral service performed in the future. Increased price competition in the future could further reduce revenues, profit margins and the backlog. Increased advertising or better marketing by competitors, or increased services from Internet providers, could cause the Company to lose market share and revenues or cause the Company to incur increased costs in order to retain or recapture the Company's market share. In recent years, marketing through television, radio and print advertising, direct mailings and personal sales calls has increased with respect to the sales of preneed funeral services. Extensive advertising or effective marketing by competitors in local markets could cause the Company to lose market share and revenues or cause it to increase marketing costs. In addition, competitors may change the types or mix of products or services offered. These changes may attract customers, causing the Company to lose market share and revenue or to incur costs in response to competition to vary the types or mix of products or services offered by the Company. Also, increased use of the Internet by customers to research and/or purchase products and services could cause the Company to lose market share to competitors offering to sell products or services over the Internet. The Company does not currently sell products or services over the Internet. Earnings from and principal of trust funds and escrow accounts could be reduced by changes in stock and bond prices and interest and dividend rates or by a decline in the size of the funds. Earnings and investment gains and losses on trust funds and escrow accounts are affected by financial market conditions that are not within the Company's control. Earnings are also affected by the mix of fixed-income and equity securities that the Company chooses to maintain in the funds, and it may not choose the optimal mix for any particular market condition. The size of the funds depends upon the level of preneed sales, the amount of investment gains or losses and funds added through acquisitions, if any. Declines in earnings from perpetual care trust funds would cause a decline in current revenues, while declines in earnings from other trust funds and escrow accounts could cause a decline in future revenues. In addition, any significant or sustained investment losses could result in there being insufficient funds in the trusts to cover the cost of delivering services and merchandise or maintaining cemeteries in the future. Any such deficiency would have to be covered by cash flow, which could have a material adverse effect on the Company's financial condition. The Company's foreign operations are subject to political, economic, currency and other risks that could adversely impact its financial condition, operating results or cash flow. The Company's foreign operations are subject to risks inherent in doing business in foreign countries. Risks associated with operating internationally include political, social and economic instability, increased operating costs, expropriation and complex and changing government regulations, all of which are beyond the Company's control. To the extent the Company makes investments in foreign assets or receives revenues in currencies other than U.S. dollars, the value of assets and income could be, and have in the past been, adversely affected by fluctuations in the value of local currencies. Declines in the number of deaths in the Company's markets can cause a decrease in revenues. Changes in the number of deaths are not predictable from market to market or over the short term. Declines in the number of deaths could cause at-need sales of funeral and cemetery services, property and merchandise to decline, which could decrease revenues. Although the United States Bureau of the Census estimates that the number of deaths in the United States will increase by approximately 1 percent per year from 2000 to 2010, longer lifespans could reduce the rate of deaths. In addition, changes in the number of deaths can vary among local markets and from quarter to quarter, and variations in the number of deaths in the Company's markets or from quarter to quarter are not predictable. These variations can cause revenues to fluctuate. The increasing number of cremations in the United States could cause revenues to decline because the Company could lose market share to firms specializing in cremations. In addition, basic cremations produce no revenues for cemetery operations and lesser funeral revenues and, in certain cases, profit margins than traditional funerals. The Company's traditional cemetery and funeral service operations face competition from the increasing number of cremations in the United States. Industry studies indicate that the percentage of cremations has steadily increased and that cremations will represent approximately 36 percent of the United States burial market by the year 2010, compared to 25 percent in 1999. The trend toward cremation could cause cemeteries and traditional funeral homes to lose market share and revenues to firms specializing in cremations. In addition, basic cremations (with no funeral service, casket, urn, mausoleum niche, columbarium niche or burial) produce no revenues for cemetery operations and lower revenues than traditional funerals and, when delivered at a traditional funeral home, produce lower profit margins as well. If the Company is not able to respond effectively to changing consumer preferences, the Company's market share, revenues and profitability could decrease. Future market share, revenues and profits will depend in part on the Company's ability to anticipate, identify and respond to changing consumer preferences. During fiscal year 2000, the Company began to implement strategies based on a proprietary, extensive study of consumer preferences it commissioned in 1999. However, the Company may not correctly anticipate or identify trends in consumer preferences, or it may identify them later than its competitors. In addition, any strategies the Company may implement to address these trends may prove incorrect or ineffective. Because the funeral and cemetery businesses are high fixed-cost businesses, positive or negative changes in revenue can have a disproportionately large effect on cash flow and profits. Companies in the funeral home and cemetery business must incur many of the costs of operating and maintaining facilities, land and equipment regardless of the level of sales in any given period. For example, the Company must pay salaries, utilities, property taxes and maintenance costs on funeral homes and maintain the grounds of cemeteries regardless of the number of funeral services or interments performed. Because the Company cannot decrease these costs significantly or rapidly when it experiences declines in sales, declines in sales can cause margins, profits and cash flow to decline at a greater rate than the decline in revenues. Changes or increases in, or failure to comply with, regulations applicable to the Company's business could increase costs. The death care industry is subject to extensive regulation and licensing requirements under federal, state and local laws and the laws of foreign jurisdictions where it operates. For example, the funeral home industry is regulated by the Federal Trade Commission, which requires funeral homes to take actions designed to protect consumers. State laws impose licensing requirements and regulate preneed sales. Embalming facilities are subject to stringent environmental and health regulations. Compliance with these regulations is burdensome on the Company, and it is always at risk of not complying with the regulations. In addition, from time to time, governments and agencies propose to amend or add regulations, which could increase costs. CONTACT: Stewart Enterprises Inc., Metairie Kenneth C. Budde, 504/837-5880 http://www.stewartenterprises.com =============== P A R A G U A Y =============== ANTELCO: Tariff, Subscription Hike Assures Buyer US$100M Yearly --------------------------------------------------------------- The buyer of Paraguayan telephone operator Antelco, now named Copaco, could recoup its investment in two years after the government decided recently to raise call tariffs and subscription fee. According to a report by Noticias, the move secures for the new owner of the Company an additional US$100 million in annual income, making it possible for a return on investment within two years. The government is peddling Copaco for a minimum price of US$200 million. Industry observers, however, believe the firm's future operator will need US$200 million more to reactivate operations. Copaco has about 300,000 telephone lines. The new hike in local call tariffs makes the Paraguayan telephone system even more expensive. Already, Paraguayans pay the highest tariff within Latin America. ANTELCO: Group Raps Two-Year Market Monopoly Given To New Owner --------------------------------------------------------------- The privatization of Antelco, recently renamed Copaco, could result at best in a two-year monopoly and at worst a five-year duopoly of Paraguay's telephone industry, reports Noticias. A group of Internet service providers recently complained to the telecoms council Conatel, calling its proposed regulation unfair as it impairs competition during the transition following Copaco's privatization. Some observers of the deal point out that Copaco's two-year monopoly over Internet access and Personal Communication Services is inconsistent with the goal of gradually opening the market to competition. ================= V E N E Z U E L A ================= SIDOR: Defaults On $31.3M Interest Payment for Bank Loans --------------------------------------------------------- Venezuela's biggest steelmaker Siderurgica del Orinoco (Sidor) failed to make a $31.3-million interest payment on its bank loans, reports Bloomberg. The missed payment comes at the backdrop of Sidor's problematic financial condition, which has worsened because of low worldwide steel prices. At the same time, Amazonia Ltd, the holding company that controls Sidor, also missed an $8.1 million loan interest payment, said Mexican steelmaker Hylsamex SA, which owns a stake in Amazonia and Sidor. The missed payments "are the consequence of the negative conditions that persist in the international steel market," Hylsamex said in a statement. Amazonia and Sidor started talks with creditors at the end of October to restructure Sidor's $449 million of debt. Sidor is 70-percent owned by Argentina's Siderar, Hylsamex, Tubos de Acero de Mexico SA, Brazil's Usinas Siderurgica de Minas Gerais and Venezuela's Siderurgica Venezolana Sivensa SA. The remaining 30 percent is owned by the Venezuelan government. 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. * * * End of Transmission * * *