TCRLA_Public/020204.mbx        T R O U B L E D   C O M P A N Y   R E P O R T E R

                   L A T I N   A M E R I C A

            Monday, February 04, 2002, Vol. 3, Issue 24

                           Headlines

A R G E N T I N A


BANCO FRANCES: BBVA Writes-Off Book Value Of Argentine Assets
GRUPO GALICIA: Shares Fall On Possible Delays In Govt. Measures
REPSOL YPF: Mulls Investment Cuts, Asset Write Down


B R A Z I L

COPEL: Securities Regulator Halts Trading
INEPAR ENERGIA: Director Contradicts Report On Closure, Layoffs
INEPAR SA: Moves Forward With Debenture Issue
SCHWEITZER-MAUDUIT: 4Q01 Results Better, Brazil Revamp Complete
VARIG: May Bid In Infraero's Privatization


M E X I C O

BANCRECER: Banorte To Terminate 530 Jobs, Close 105 Branches
GRUPO MEXICO: TFM Claims Ferrosur-Ferromex Merger Illegal
GRUPO MEXICO: Expects Approval On Merger Amid Competitor Protest
HYLSAMEX: Pending Debt Agreement Boosts Parent's Shares
HYLSAMEX, S.A. DE C.V.: Company Profile
MAXCOM TELECOMUNICACIONES: Reaches Agreement With Bondholders


P A R A G U A Y

BANCO ORIENTAL/UNION: Central Bank Shuns Tulac's Plea Bargain


T R I N I D A D   &   T O B A G O


BWIA: Government To Ensure Airline Fulfills Promise To Unions


     - - - - - - - - - -


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


BANCO FRANCES: BBVA Writes-Off Book Value Of Argentine Assets
-------------------------------------------------------------
Banco Bilbao Vizcaya Argentaria wrote off the book value of its
assets in Argentina and posted lower-than-expected consolidated
net income for 2001, according to a report in The Wall Street
Journal.

BBVA, Spain's second-largest banking group, set aside EUR1.35
billion in the second half of 2001 as provisions for its entire
exposure to Argentina, including its 68 percent stake in Banco
Frances.

The move cut deep into the bank's net profit, which grew 5.9
percent for the year, instead of the 16 percent increase the bank
projected in October, The Wall Street Journal Says.

Group operating income rose 28 percent to EUR5.59 billion in 2001
from EUR4.37 billion the previous year. Profit per share rose 1.7
percent.

"We hadn't been expecting a rise in net profit so much under 10
percent," said Miguel Pareja, head of analysis at Eurodeal in
Madrid. "They've gone for a very high provision."

Even though it has written off its assets in Argentina, BBVA
won't withdraw from the troubled Latin American country. Despite
the fact that the Argentine economy is still mired in crisis
after the government last month devalued the currency and
defaulted on its US$141 billion (EUR163 billion) foreign debt,
the situation improved in recent weeks, said BBVA Chairman
Francisco Gonzalez

The new government "realizes now that there is no feasible
solution to the crisis without the support of the international
community," Gonzalez Said.

However, Gonzalez warned that BBVA will "rethink its investments"
in Argentina if the crisis deepens and the government fails to
come up with a viable plan for resolving it -- a scenario he
doesn't expect.

If the Argentine government reaches an agreement with
the International Monetary Fund, BBVA could continue in Argentina
for an extended period without having to recapitalize its local
unit, Mr. Gonzalez said.

"We could withstand the situation for a long time, not just
months, because we have many resources in Argentina," he said.

CONTACTS:  BANCO FRANCES
           Gervasio Collar Zabaleta, Chairman
           Antonio Martinez Jorquera, CEO
           Jorge Bledel, Head of Treasury and Wholesale Banking

           Their address:
           Reconquista 199
           1003 Buenos Aires, Argentina
           Phone: +54-11-4346-4000
           Fax: +54-11-4346-4320


GRUPO GALICIA: Shares Fall On Possible Delays In Govt. Measures
---------------------------------------------------------------
Grupo Financiero Galicia SA shares fell 6.35 percent to 59
centavos, reports Bloomberg. The move reflects investors' concern
over the current ambiguity in governmental regulations.

Galicia, the holding company for the biggest Argentine-owned bank
Banco de Galicia y Buenos Aires, lost more deposits than other
Argentine banks during a run on banks in November that prompted
the government to curtail withdrawals.

Investors said Galicia would most benefit from an agreement with
the International Monetary Fund to help restore government credit
lines to banks, but they were concerned such an accord may not be
approved soon.

CONTACTS: BANCO DE GALICIA
          Transfer Agent and Registrar:
          Caja de Valores S.A. Sarmiento 299 1er subsuelo (1353)
          Buenos Aires, Argentina
          Tel : (54 11) 4317 8900

          Contacts:
          Tte. Gral Juan D. Peron 407
          1038 Buenos Aires, Argentina
          Tel: +54-11-6329-0000
          Fax: +54-11-6329-6100

          Corporate Communications:
          Tel: (54 11) 6329 6439
          Fax:(54 11) 6329 6000 ext.: 2041

          Strategic Analysis Dept:
          Tel : (54 11) 6329 6430
          Fax : (54 11) 6329 6494:
          email: teresa.pascual@bancogalicia.com.ar


REPSOL YPF: Mulls Investment Cuts, Asset Write Down
---------------------------------------------------
Alfonso Cortina, Chairman and Chief Executive Officer of Repsol
YPF SA, announced that the Spanish oil and gas company will cut
investment and write down assets in Argentina to reflect the
currency devaluation, reports Bloomberg.

Cortina disclosed that the company would take a charge against
reserves because of the devaluation, but he didn't give an
estimate of the amount of the charge. Cortina said Repsol may
also make a provision against earnings and will cut spending,
"until the situation is clarified."

Repsol, Europe's fifth-largest oil company, became one of the
most indebted oil companies in the region after it bought YPF,
Argentina's biggest company, in 1999 for US$15 billion.

The firm is the worst-performing stock in the 12-member Bloomberg
Europe Oil and Gas Producers Index and the only one to lose share
value for investors this year, falling 15 percent.

The company's stock and bonds have fallen on concern a new oil
export tax proposed by Argentina will reduce earnings, increasing
the cost of paying off almost EUR20 billion in debt.

CONTACTS:  REPSOL YPF/YPF
           Alfonso Cortina De Alcocer, Chairman & CEO
           Ramon Blanco Balin, Vice Chairman
           Carmelo De Las Morenas Lopez, CFO

           Their Address:
           Paseo de la Castellana 278
           28046 Madrid, Spain
           Phone   +34 91 348 81 00
           Home Page: http://www.repsol.com

           or
           Av. Roque S enz Pe a, 777.
           C.P 1364. Buenos Aires
           Argentina



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

COPEL: Securities Regulator Halts Trading
-----------------------------------------
The Brazilian securities regulator halted trading on electricity
utility Companhia Paranaense de Energia (Copel), reports
Bloomberg. The move followed a government announcement that
state-owned utilities as of next year will be allowed to set
their own electricity prices.

The country's power rationing committee issued a statement
saying, federal and state-owned power generators will be able to
raise rates to market levels in a bid to encourage private
investment to build new power plants. Brazil needs to attract
$3.6 billion in investment annually to relieve power shortages,
the statement added.

"It secures fair market competition," the statement said. "Since
state-owned companies have a large market share, new private
investment could have been canceled on concern government firms
would use their power to eliminate competition."

Brazil said its power generators, which account for 80 percent of
the country's energy output capacity, will have to auction
electricity stemming from power purchase contracts expiring as of
2003, forcing them to increase rates to market levels and ending
their advantage over private generators.

Power distributors, large industrial energy users and power
trading companies will be able to participate in the auctions,
which will be regulated by the country's electricity regulator
Aneel, the statement said.

Copel has 17 hydroelectric plants and one thermoelectric plant
with a total capacity of over 4,500 megawatts. The Company
accounts for about 7 percent of Brazil's power generation
capacity.

Brazil's southern Parana state government recently dropped plans
to privatize Copel after potential investors balked at the
process. Potential investors pointed to changes in government
energy policy and default in Argentina as reasons for their
sudden disinterest.

CONTACTS:  Ingo Henrique Hobert, Chief Executive Officer
           Deni Lineu Schwartz, Chief Government Relatins Officer
           Ferdinando schauenburg, CFO

           THEIR ADDRESS:
           Companhia Paranaense de Energia (COPEL)
           Dulcidio, 800
           Batel  80420-170 Curitiba - PR
           Brazil
           Phone   +55 41 322-3535

           Home Page http://www.copel.com

           INVESTOR RELATIONS
           Ricardo Portugal Alves
           Email: Ricardo.portugal@copel.com
           AND
           Othon M,der Ribas
           Email: othon@copel.com


INEPAR ENERGIA: Director Contradicts Report On Closure, Layoffs
---------------------------------------------------------------
Ricardo Aquino, director at Inepar Energia, denied a Valor
Economico's Wednesday report that suggested the Brazilian company
is closing two subsidiaries as part of a company restructuring,
reports Business News Americas.

Aquino further countered Valor Economico's report that all the
Company's functionaries, including eight directors, were laid
off.

"Inepar Energia is working normally, and there is no plan to lay
off staff or cease activities. What is happening - and this has
been underway for a number of months now - is the sale of some
company assets, such as the stakes already sold in the Itiquira
and Machadinho hydroelectric plants," Aquino said.

Inepar is divesting from Inepar Telecomunicacoes, Aquino said,
but he did not go into details, nor did he deny the possibility
that this company might cease activities in the future.

Inepar Energia continues with the assets sale, and negotiations
have been underway for some months to sell the company's stakes
in distributors Cemar (Mato Grosso state) and Celpa (Para state)
in which it owns 29.5 percent and 33.6 percent of the shares,
respectively. The controller of both distributors is Grupo Rede.


INEPAR SA: Moves Forward With Debenture Issue
---------------------------------------------
Inepar S.A. Industria e Construcoes will now proceed with the
process to offer convertible debentures worth BRL270 million,
reports Gazeta Mercantil. This planned issue has been held up
pending the CVM's (Comissao de Bolsa de Valores) approval, which
has been delayed by requests from the CVM for more current
financial figures from Inepar.

Proceeds from the new notes will be used to extend the profile of
the Company's current debts and restructure its operations. The
Inepar Engenharia will also get an injection of BRL14 million to
be invested in the electric power plant Dona Francisca.

Coordinating the issue is Banco Fator, while C&D Distribuidora de
Titulos e Valores Mobiliarios is acting as the fiduciary.

CONTACTS:  Atilano De Oms Sobrinho, Chairman
           Rodolfo Andriani, Joint Chairman
           Jose L. Bussular, Finance Director

           THEIR ADDRESS:
           Avenida Juscelino K. de Oliveira, 11400
           Cic  81450-900 Curitiba - PR
           Brazil
           Phone   +55 41 350-7551
           Home Page http://www.inepar.com.br


SCHWEITZER-MAUDUIT: 4Q01 Results Better, Brazil Revamp Complete
---------------------------------------------------------------
In an official company news release, Schweitzer-Mauduit announced
the following results:

- Fourth Quarter Earnings Per Share of $.52

- Full Year Earnings Per Share of $1.86 Excluding Unusual Item

Schweitzer-Mauduit International, Inc. (NYSE: SWM) today reported
that fourth quarter net income was $7.8 million compared with net
income of $6.6 million in the fourth quarter of 2000, an
improvement of 18 percent.  Diluted earnings per share were $.52
compared with diluted earnings per share of $.44 for the prior-
year quarter, also an 18 percent improvement.  Diluted earnings
per share for full-year 2001 were $1.86, excluding a pre-tax
charge of $5.1 million, or $.23 per share, recorded in the second
and third quarters of 2001 to implement a restructuring of the
Company's Brazilian operations, compared with diluted earnings
per share of $1.82 for full-year 2000, an improvement of 2
percent.

Fourth Quarter 2001 Results

Wayne H. Deitrich, Chairman of the Board and Chief Executive
Officer, commented that, "Schweitzer-Mauduit's financial results
for the fourth quarter of 2001 benefited from an improvement in
gross profit margin, primarily attributable to lower wood pulp
costs, a better mix of products sold in Brazil following
completion of the restructuring of the Company's Brazilian
operations, higher average selling prices and improved U.S. mill
operations other than at the Spotswood, New Jersey mill.  Results
for the quarter were unfavorably impacted by lower sales volumes,
expenses related to the banded cigarette paper project and
resultant higher cost of operations at Spotswood and increased
nonmanufacturing expenses."

Net sales were $126.7 million for the quarter compared with
$130.3 million in the same period a year ago, a decline of 3
percent.  The decrease in net sales was the result of lower sales
volumes which reduced net sales by $5.4 million during the
quarter, primarily attributable to exiting the printing and
writing uncoated papers business in Brazil.  Changes in currency
exchange rates, primarily due to a weaker U.S. dollar versus the
euro, contributed favorably by $0.6 million to the net sales
comparison, while higher average selling prices increased net
sales by $1.2 million during the quarter.

Total sales volumes declined by 11 percent for the quarter
compared with the fourth quarter of 2000, primarily due to lower
sales volumes in Brazil. Sales volumes for the Brazilian business
were 44 percent lower compared with the fourth quarter of 2000,
as lower sales resulting from the decision to exit the printing
and writing uncoated papers business in Brazil more than offset
increased sales of tobacco-related papers.  Sales volumes in the
United States were 3 percent lower than the prior-year level.
U.S. sales volumes in the fourth quarter of 2000 benefited from
an inventory build by a major domestic customer, while U.S. sales
volumes in the fourth quarter of 2001 were favorably impacted by
a strike at the RFS Ecusta Inc. paper mill, the Company's major
domestic competitor.  Sales volumes in France improved by 1
percent from the prior-year quarter.

Operating profit was $14.9 million for the quarter, up $2.0
million or 16 percent from the $12.9 million operating profit for
the fourth quarter of 2000.

The average per ton list price of northern bleached softwood
kraft pulp in the United States was $485 per metric ton in the
fourth quarter of 2001 compared with $710 per metric ton in the
fourth quarter of 2000, lowering operating costs by $5.4 million
compared with the prior-year quarter. Purchased energy costs
remained at approximately the same level as during the third
quarter of the year, but were $0.3 million higher than in the
fourth quarter of 2000.

Operating profit in Brazil improved by $2.7 million as a result
of lower per ton wood pulp costs, an improved mix of products
sold following the exiting of the printing and writing uncoated
papers business earlier this year, somewhat higher average
selling prices and lower local business taxes.

Operating profit for the United States was $0.5 million higher
than in the fourth quarter of 2000 as a result of lower per ton
wood pulp costs, improved mill operations other than at the
Spotswood mill and higher average selling prices, partially
offset by lower sales volumes, additional expenses associated
with implementation of the banded cigarette paper project at
Spotswood and higher purchased energy costs.

Operating profit for the French businesses was $0.5 million lower
than in the prior-year quarter, attributable to the timing of
maintenance expenses, higher chemical and purchased material
prices and a less favorable mix of products sold, partially
offset by lower per ton wood pulp costs and higher average
selling prices.

Nonmanufacturing expenses were $0.6 million higher than in the
prior-year quarter as a result of increased general expense
caused primarily by higher compensation and benefit costs in the
United States and France.

The effective income tax rate was 36.1 percent for the quarter,
compared with 33.9 percent in the fourth quarter of 2000.  The
lower effective income tax rate in the prior-year quarter
reflected the favorable tax treatment of an equity-related
payment from Brazil.  The fourth quarter of 2001 benefited from a
similar but smaller payment.

Full-Year 2001 Results

Net sales totaled $499.5 million for full-year 2001, a 1 percent
improvement compared with 2000, as a result of changes in sales
volumes and higher average selling prices, partially offset by
the impact of changes in currency exchange rates related to the
strengthened U.S. dollar which reduced net sales by $11.8
million.  Total sales volumes decreased by 4 percent compared
with the prior year, with sales volumes for the French businesses
increasing by 6 percent, U.S. sales volumes remaining level and
sales volumes for the Brazilian business declining by 29 percent.
The decline in Brazilian sales volumes was related to reduced
sales of printing and writing papers.

Operating profit was $47.3 million for 2001, a 5 percent decline
compared with 2000.  Excluding the $5.1 million restructuring
charge in Brazil, operating profit was $52.4 million for the
year, an improvement of 5 percent compared with the prior year.
Full-year operating profit benefited from changes in sales mix
and volumes, lower per ton wood pulp costs, improved U.S. mill
operations other than at the Spotswood mill and higher average
selling prices, offset by higher purchased energy and Spotswood
mill costs, increased nonmanufacturing expenses and the Brazilian
restructuring charge.  The effective income tax rate was 36.4
percent for 2001 compared with 31.4 percent for 2000.

Net income for 2001 was $24.5 million, a 12 percent decline
compared with net income of $27.8 million in 2000.  Net income
excluding the unusual item was $27.9 million.  Diluted earnings
per share decreased by 10 percent to $1.63 compared with earnings
per share of $1.82 for the prior year.  Excluding the Brazilian
restructuring charge of $.23 per share, 2001 diluted earnings per
share were $1.86, a 2 percent improvement from the prior year.

Capital Spending and Quarterly Dividend

Capital spending was $17.9 million during the fourth quarter of
2001 compared with $15.4 million during the prior-year quarter.
Capital spending for the full year was $73.8 million compared
with $29.4 million in 2000.  The banded cigarette paper capital
project at the Spotswood mill proceeded on schedule.  Capital
spending for this project totaled $5.0 million during the fourth
quarter and $50.1 million for full-year 2001.  The construction
phase of this project has now been completed although additional
process checkouts, machine trials and product qualifications will
continue during subsequent quarters.  During the fourth quarter,
an idle cigarette paper machine at the Spotswood mill was
renovated and placed back in operation to support anticipated
future production requirements, at a total capital cost of $2.6
million during 2001.  Capital spending is expected to be in the
range of $25 to $30 million during 2002.

Schweitzer-Mauduit also announced a quarterly common stock
dividend of $.15 per share.  The dividend will be payable on
March 18, 2002 to stockholders of record on February 19, 2002.

Business Comments

Mr. Deitrich added, "Schweitzer-Mauduit successfully completed
major activities during 2001 that will support improved financial
performance in the future.  The construction phase of the banded
cigarette paper project at the Spotswood mill has now been
completed.  Although this project should benefit future periods,
the Company is not currently expecting a significant increase in
the production and sale of banded cigarette paper during 2002.
Cigarette manufacturers have not yet finalized their plans for
the use of this new product.  This project had a much greater
than anticipated unfavorable impact on mill operations during
2001 as a result of an accelerated construction timetable and
increased demands placed on all aspects of the operation.
Improvement is anticipated in operating costs at the Spotswood
mill in subsequent quarters, with December mill results being the
best achieved in 2001.  The unfavorable mill operations at
Spotswood more than offset significant gains made at the other
U.S. mills during the year.  Improvement is expected in the
Company's U.S. operations during 2002."

"Although Schweitzer-Mauduit expects sales volumes during the
first half of 2002 to be less than the comparable prior-year
period as a result of exiting the printing and writing uncoated
papers market in Brazil, improvement is expected in the Company's
Brazilian operations during 2002 as a result of the recently
completed restructuring program.  An improved mix of products
sold and lower operating costs are expected to contribute to
improved performance in Brazil."

"Cost of products sold for the first half of 2002 is expected to
benefit from lower per ton wood pulp costs compared with the
prior year.  Wood pulp costs currently appear to be near the
bottom of the pulp price cycle and future pulp cost increases
will be dependent upon a strengthening of world-wide economic
activity.  The current level of wood pulp costs and the strong
U.S. dollar continue to exert some pressure on our selling
prices."

"The Company's effective income tax rate is expected to be
approximately 35 percent in 2002.  We expect diluted earnings per
share in 2002 to be in the range of $2.00, as a result of
improvements in Spotswood mill costs, in Brazil's results due to
the restructuring program and in our French operations."

Schweitzer-Mauduit International, Inc. is a diversified producer
of premium specialty papers and the world's largest supplier of
fine papers to the tobacco industry.  It also manufactures
specialty papers for use in alkaline batteries, vacuum cleaner
bags, overlay products, business forms and printing and packaging
applications.  Schweitzer-Mauduit and its subsidiaries conduct
business in over 90 countries and employ 3,400 people worldwide,
with operations in the United States, France, Brazil and Canada.
For further information, please visit the Company's Web site at
http://www.schweitzer-mauduit.com.

CONTACTS:  Bill Foust        Paul Roberts
           770-569-4203      770-569-4277

           Otto R. Herbst, President - Brazilian Operations
           SCHWEITZER-MAUDUIT:
           Avenue Darcy Vargas
           325 Santan‚sia Pirai
           Rio de Janeiro 27195-000
           Brasil
           Phone:   55-24-447-5000
           URL: http://www.schweitzer-mauduit.com

           Investor Relations Department (US)
           Schweitzer-Mauduit International, Inc.
           100 North Point Center East, Suite 600
           Alpharetta, Georgia 30022-8246
           Phone: 800-514-0186 or 770-569-4272
           Email: investors@swm-us.com


VARIG: May Bid In Infraero's Privatization
------------------------------------------
Brazilian airline Varig said it is considering a plan to
participate in the privatization auction of Infraero, the company
managing Brazil's airports, reports Jornal do Commecio. Word of
Varig's intentions surfaced even though firm plans for
privatizing Infraero have yet to be announced.

Infraero's profitability attracted Varig to this possibility as
it is looking to reduce its debt and sees this strategy as a way
of accomplishing it.

Varig said that it could even create a subsidiary for this
purpose, as it has done with its Varig Engenharia e Manutencao
subsidiary. Infraero posted a profit of BRL340 million in 2001,
an increase of 111 percent over 2000.

Varig, which has been hampered by slow ticket sales and rising
operating costs since the September 11 attacks, is currently in
negotiations to sell part of its equity, possibly to a foreign
investor.

VARIG CONTACTS:  VARIG Brazilian Airlines, Miami
                 Jeff Kriendler, 305/866-2115
                 email: jkriendler@aol.com

                 Legal Department:
                 Rua 18 de Novembro nr. 800 Navegantes
                 Zip : 90240-040
                 City : Porto Alegre / RS - Brazil
                 Telephone numbers: (51) 358-7039/7040
                                   (51) 358-7010/7042

                 INDEPENDENT ACCOUNTANTS
                 Arthur Andersen S/C
                 Rua Alexandre Dumas 1981
                 Cep: 04.717-906 - Centro / Sao Paulo / S P-
                 Brazil
                 Tels.: (11) 5504-8200
                 Fax:  (11) 5504-8373

                 INVESTOR RELATIONS MANAGER/STOCKHOLDER SERVICES
                 Leir s  Stortti
                 E-mail: leir.stortti@varig.com.br
                 Av. Almte. Silvio de Noronha, n  365 -
                 Bloco "A" - s/416
                 Centro - Rio de Janeiro - RJ
                 Cep.:  20021-010
                 Tels.: (21) 3814-5401/5402/5403/5415
                 Fax:  (21) 3814-5543



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

BANCRECER: Banorte To Terminate 530 Jobs, Close 105 Branches
------------------------------------------------------------
Grupo Financiero Banorte SA, Mexico's fourth-largest bank,
continues to merge the operations of Bancrecer SA, the Mexico
City-based bank, which it recently bought for MXN1.65 billion
(US$174 million).

According to a Bloomberg report, Banorte will sack 530 workers in
the next three months and close 105 branches as part of its plans
to fire about 2,000 workers and close 250 branches throughout the
balance of the year.

Banorte, based in the northern city of Monterrey, has already
fired 260 workers as part of its strategy to reduce costs after
it bought BanCrecer from the government.

The staff and branch reductions are expected to give Banorte the
right size to compete against foreign rivals that have purchased
Mexico's largest banks in past years.

Banorte expects loan growth of between 8 percent and 10 percent
this year as record low interest rates and a rebound in economic
activity may create demand from small- and medium-size companies.
It will also continue granting consumer, car and home loans in
2002.

The bank's outlook on its loan portfolio is based on the consumer
base it acquired by buying BanCrecer.

CONTACTS:  BANORTE
           Institutional Investors
           Jorge Coln
           Director de Relaciones con Inversionistas
           (528) 319 52 10

           Gabriela Renovato
           Gerente de Relaciones con Inversionistas
           (528) 319 52 19
           E-mail: investor@banorte.com
           Fax.- (528) 319 52 35

           Correspondent Bank
           Eduardo Gonz lez
           Vice Presidente de Banca Internacional
           (528) 319 62 07

           Claudia Zapata Canto
           Gerente de Bancos Corresponsales
           (528) 319 62 65
           e-mail: claudia.zapata@banorte.com
           Fax.- (528) 319 62 43

           Brokerage House
           Gerardo Molina
           Vice Presidente de An lisis
           (52) 53 25 28 40

           Fabiola Molina
           Analista del Sector Burs til
           (52) 53 25 28 00 ext.2656
           E-mail: fvmolina@cbbanorte.com.mx
           Fax.- (52) 53 25 29 54


GRUPO MEXICO: TFM Claims Ferrosur-Ferromex Merger Illegal
---------------------------------------------------------
Grupo Transportacion Ferroviaria Mexicana (TFM), Mexico's largest
multimodal transport company, on Tuesday alleged that the merger
between rival railroad operators Ferrosur and Ferromex
(Ferrocarril Mexicano) was not legal, says Business News
Americas.

TFM argued that the merger breaches anti-monopoly rules laid down
by the federal government when Mexico's railroad industry was
privatized in the late 1990s. According to TFM, the rules
stipulated that each holder of the three major railroad routes
could not own more than a 5 percent stake in either of the other
two, as a means of safeguarding competition.

Ferrosur holds the concession for the key Valley of Mexico-
Coatzacoalcos railroad axis, while Ferromex operates the network
that connects the Valley of Mexico with northern destinations
including Monterrey, Guadalajara, Torreon, the ports of
Manzanillo and Altamira and the Mexico-US border.

"A merger of this type would put in doubt the objectives and
philosophy of the [railroad] privatization process, and take the
Mexican railroad industry on a path contrary to the interests of
its users," TFM president Jose Serrano said.

TFM, however, did not say whether it would take any legal action
to derail the Ferrosur-Ferromex merger.

TFM, a partnership between TMM and U.S. company Kansas City
Southern Industries Inc., operates the Northeast Railway
concession, which moves about 40 percent of the rail cargo in
Mexico.

CONTACTS:  German Larrea Mota-Velasco, Chairman and CEO
           Avenida Baja California 200, Colonia Roma Sur
           06760 M,xico, D.F., Mexico
           Phone: +52-5-264-7775
           Fax: +52-5-264-7769

           C.P. Hector Garcia De Quevedo Topete, Corporate Dir.
           Av. Baja California No. 200, Colonia Roma Sur C.P.
           06760 MEXICO, D.F.
           Phone: 55-64-70 66 ext 7238
           Fax: 55-64-3714

           UNDERWRITER: ING BARRINGS
           Corporate communication and public relations:
           C.P. HECTOR GARCIA DE QUEVEDO TOPETE
           CORPORATE DIRECTOR
           AV. BAJA CALIFORNIA No. 200
           Colonia ROMA SUR C.P. 06760
           MEXICO, D.F.
           Tel: 55-64-70 66 ext 7238 Fax: 55-64-3714
           moram@gmexico.com.mx


GRUPO MEXICO: Expects Approval On Merger Amid Competitor Protest
----------------------------------------------------------------
TFM's arguments on the legalities of the Ferrosur-Ferromex merger
failed to shake Mexican copper giant Grupo Mexico optimism that
the government will approve the said process.

"There is a positive attitude (on the part of the authorities)
... however they have to review the conditions and the legality
of the operation," said Hector Garcia, deputy director of
investor relations for Grupo Mexico. "We don't see any problems."

Grupo Mexico and Grupo Carso recently announced that Carso units
Frisco and Sinca Inbursa would transfer their share of Carso's
Ferrosur railway unit to Grupo Mexico subsidiary Infraestructura
y Transportes de Mexico (ITM).

In exchange, Frisco and Sinca Inbursa would get a 20 percent
stake in ITM. Carso and its subsidiaries are part of the business
empire of Mexican billionaire Carlos Slim.

Grupo Mexico's Garcia said the merger with Grupo Carso is
"totally" legal because on giving their share in Ferrosur to ITM,
Frisco and Sinca Inbursa would end up participating in only one
merged railway business.

Officials from the Communications and Transport Ministry were not
immediately available for comment. The Ministry as well as the
anti-trust watchdog, the Federal Competition Commission (CFC),
will have a say in approving the merger.

Jorge Beristain, an analyst for Deutsche Banc Alex. Brown in New
York, said he expected that the merger would be approved by
authorities, calling it an "excellent idea" that would make
railroad operations in Mexico more efficient."

"I imagine (authorities) prefer a sector with more critical mass
instead of various small operators with no scale or access to
capital," he said. "Mexico needs to improve its rail
transportation to compete with the United States."


HYLSAMEX: Pending Debt Agreement Boosts Parent's Shares
-------------------------------------------------------
Shares of Mexican industrial conglomerate Grupo Alfa closed up
1.76 percent at MXN12.70 per share after Credit Suisse First
Boston said that the company's efforts to restructure its ailing
steel unit Hylsamex were starting to bear fruit, reports Reuters.

Shares of Hylsamex also soared for a fourth day on Thursday,
rising 70 centavos, or 12.3 percent, to MXN6.4, according to
Bloomberg. Hylsamex SA is about to announce an agreement with its
bank creditors to restructure $627 million in debt.

Hylsamex announced that its cash flow, or earnings before
interest, taxes, depreciation and amortization (EBITDA), fell 3
percent to US$34 million in the fourth quarter from US$35 million
in the third quarter. Total sales volume was 615,700 tons of
steel, or 3 percent more than the same quarter last year.

"They might work this out, but there won't be another bank that's
going to want to lend to them in the future," said Inigo Ugarte,
who helps to manage about $20 million in Mexican equities at Casa
de Bolsa Bital SA.

Alfa is looking for a "strategic investor" for Hylsamex and may
also offload some of Hylsamex's non-core assets.

CONTACT:  Dionisio Garza Medina, CEO
          Raul Gonzalez Casas, Investor Relations
          TEL. 52 8748-1177  FAX. 52 8748-2544
          rgonzale@alfa.com.mx



HYLSAMEX, S.A. DE C.V.: Company Profile
---------------------------------------
NAME: Hylsamex, S.A. de C.V.
      Munich Ave. 101
      San Nicol s de los Garza N.L., 66452
      M‚xico

PHONE: (52) 81 8865 1224, (52) 81 8865 1201

WEBSITE: http://www.hylsamex.com.mx

EXECUTIVE MANAGEMENT TEAM: Felipe Garza Medina, CEO
                           Eli‚zer Galv n Martˇnez, CCO

INVESTOR RELATIONS: Margarita Guti‚rrez
                    Phone: (52) 81 8865 1224
                    E-Mail: mgutierrez@hylsamex.com.mx

                    Ricardo Sada
                    Phone: (52) 81 8865 1201
                    E-Mail: rsada@hylsamex.com.mx

CORPORATE PUBLIC RELATIONS: Rafael Rubio
                            Ave. Munich #101
                            San Nicolas de los Garza, NL
                            M‚xico, CP 66452
                            Phone: (52) 81 8865 1340
                            Fax: (52) 81 8865 1304
                            E-Mail: rindustriales@hylsamex.com.mx

TYPE OF BUSINESS: Hylsamex, S.A. de C.V.. produces steel which
consists of iron and steel sheet, coils, bars, wire, pipe,
fencing and rods which are used in construction, auto parts and
white goods industries; and the provision of administrative
services.  Hylsamex is composed of business units: Flat Products
Division, Bar and Rod Division, Galvacer, HYL and Acerex. It also
encompasses support subsidiaries in the mining, scrap metal
processing, transportation, and steel marketing fields.

SIC: Metal and Steel Producers & Products Manufacturers

EMPLOYEES: 7,421

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


MAXCOM TELECOMUNICACIONES: Reaches Agreement With Bondholders
-------------------------------------------------------------
In an official press release, Maxcom announced it is
restructuring debt and intends to receive up to $70 Million of
new equity funding.

Based on turnaround results achieved in 8 months by new
management, the company announced the following:

-  Outstanding Debt Would Be Reduced by 36%
-  Stakeholders Supportive of Maxcom's Ongoing Results and New
Management Team
-  3x Line Growth in 8 Months Validates Maxcom's Business Model
-  Despite Market Conditions, Stakeholders Validate Maxcom's
Potential

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 the Mexican territory, announced Thursday that it
has reached an agreement in principle with an informal committee
of bondholders, who hold the majority of its outstanding
debt.  The restructuring plan would reduce Maxcom's debt by 36%
to $175 million, impacting positively on its annual debt service
by $38 million over each of the next four years.

Bondholders representing over 56% of the outstanding Senior Notes
have agreed to the terms of the restructuring plan and will
tender their notes as part of the agreement.  Additionally, a
group of investors led by some of the existing shareholders will
invest up to $70 million in additional equity capital to fund
ongoing capital expenditure and customer acquisition costs.

The Company anticipates that the exchange offer and consent
solicitation will take effect as soon as feasible.  Among the
terms of the restructuring plan the following are included:

*  Maxcom's outstanding $275 million principal amount Senior
Notes will be exchanged for $175 million principal amount of New
Senior Notes maturing on March 1, 2007, along with an additional
consideration mentioned below.

*  The $175 million New Senior Notes will bear 0% (zero) interest
through March 1, 2006 and 10% payable semiannually in the final
year.

*  The Company will issue New Series A Convertible Preferred
Stock to bondholders upon completion of the exchange offer,
representing approximately 15% of Maxcom's outstanding capital
stock prior to dilution of existing options and warrants.

*  As part of the exchange offer, the Company will solicit
consents to amend the terms of the indenture governing the Senior
Notes to eliminate substantially all of the restrictive covenants
and certain events related to default.

*  If the exchange offer is completed before April 1, 2002, which
is the next interest payment date on the Senior Notes,
bondholders will also have the option to receive either cash in
an amount equal to what they would have received as interest
payment, or additional New Series A Convertible Preferred Stock.

*  The Company will cancel its $25 million proprietary position
on the Senior Notes repurchased during year 2001.

Stakeholders will invest up to $70 million in exchange for New
Series B Convertible Preferred Stock.  The New Series B
Convertible Preferred Stock issued in connection with the
restructuring will represent 77.5% of Maxcom's outstanding
capital stock.  The $70 million investment, which is conditioned
to the completion of the exchange offer, will be disbursed in two
tranches: $50 million upon the completion of the exchange offer,
and $20 million during the following year at the Company's
choice.

"I am extremely pleased that Maxcom's key stakeholders could
reach an agreement that recapitalizes the Company and provides
for its continued growth and success," stated Fulvio Del Valle,
Maxcom's President and Chief Executive Officer. Mr. Del Valle
added, "despite current market conditions, we completed the
negotiations in a record time as the stakeholders did not want to
waste time once they've validated Maxcom's potential."

"This restructuring will enable Maxcom to fund its business plan
and aggressively attack its target markets," said Jacques
Gliksberg from Banc of America Equity Partners and Chairman of
the Finance Committee of Maxcom's Board of Directors. Mr.
Gliksberg added, "this agreement with the bondholders committee
during difficult times in the telecommunications industry,
particularly in emerging markets, is an indication of the
confidence that the shareholders and bondholders have in Maxcom's
management and existing business opportunities."

"Maxcom's bondholders committee is very supportive of the
Company's ongoing results and its management; it believes that
the restructuring plan positions the Company as a significant
player in the Mexican telecommunications industry," stated
Michael Stamer of Akin, Gump, Strauss, Hauer & Feld, L.L.P.,
counsel to the informal bondholders committee.

The completion of the restructuring plan and additional $70
million investment is subject to certain conditions, including
the exchange of at least 95% of the outstanding Senior Notes and
certain Mexican regulatory approvals.

Maxcom Telecomunicaciones, S.A. de C.V, headquartered in Mexico
City, Mexico, is a facilities-based telecommunications provider
using a "smart- build" approach to deliver last-mile connectivity
to small- and medium-sized businesses and residential customers
in the Mexican territory. Maxcom launched commercial operations
in May 1999 and is currently offering local, long distance and
data services. In March 2000 the Company issued US $300 million
in 13.75% notes due 2007. Information about Maxcom's bonds can be
located on Bloomberg under the symbol "MAXTEL".

CONTACT:  Maxcom Telecomunicaciones, S.A. de C.V.
          Jose-Antonio Solbes
          Tel. 5255-5147-1125
          investor.relations@maxcom.com

          Citigate Dewe Rogerson
          Lucia Domville
          Tel. +1-212-419-4166
          lucia.domville@citigatedr-ny.com



===============
P A R A G U A Y
===============

BANCO ORIENTAL/UNION: Central Bank Shuns Tulac's Plea Bargain
-------------------------------------------------------------
Los Angeles-based attorney John Tulac offered to return the
US$14-million amount he allegedly stole from liquidated
Paraguayan banks Oriental and Union in exchange for an end to
legal proceedings.

However, according to a report by Business News Americas,
Paraguay's Central Bank rejected Tulac's offer and said it will
move ahead with the case because the government wants to see him
prosecuted.

Additionally, according to a spokesperson from the Central Bank,
the institution is also eager to learn the identities of the
Paraguayans involved in the theft.

A US court is handling the case against Tulac, but Paraguay could
request his extradition, the spokesperson said.

Tulac reportedly hid the US$14 million in Citibank accounts in
New York, the spokesperson said. A total of US$16 million was
siphoned out of the banks and Tulac claims that the rest of the
money was paid to Paraguayans involved in the theft.

The scandal rocked Paraguay's financial elite in its foundations
last year, leading to the dismissal of banking regulator Carlos
Pecci and the resignation of Central Bank chairman Washington
Aswell.



=================================
T R I N I D A D   &   T O B A G O
=================================


BWIA: Government To Ensure Airline Fulfills Promise To Unions
-------------------------------------------------------------
The Trinidad government vowed to take action in order for unions
representing BWIA workers to receive their share in the Company
promised to them in 1995, Trade Minister Ken Valley said in a
report released by The Trinidad Guardian.

In 1994, the unions signed a deal to buy 15.5 percent of shares
in the airline from government, as part of BWIA's divestment.
Another 10 percent was to be made available to them through an
employee share ownership plan (ESOP). Valley said he will be
talking to the airline's management about offering the 10 percent
ESOP.

He added that since divestment, the government had decreased its
ownership by 33.5 percent, limiting its involvement in the
airline.

"We are simply an investor. Therefore if the workers have a
difficulty with the airline, that falls with the Ministry of
Labor, as any other private sector company," he said.

BWIA has stated that, due to weak post September bookings, it has
started to look at the process of restructuring that will likely
lead to dismissals.





               ***********


S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter Latin American is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Trenton, NJ,
and Beard Group, Inc., Washington, DC. John D. Resnick, Edem
Psamathe P. Alfeche and Fe Ong Va¤o, Editors.

Copyright 2002.  All rights reserved.  ISSN 1529-2746.

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