/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/020225.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 25, 2002, Vol. 3, Issue 39 Headlines A R G E N T I N A METROGAS: Late Interest Payment Blamed on Transfer Restrictions SCOTIABANK QUILMES: Chief Remains In Country Pending Probe B E R M U D A GLOBAL CROSSING: Schiffrin & Barroway, Files Class Action Suit GLOBAL CROSSING: Shareholders To Submit Competing Rescue Plan GLOBAL CROSSING: Ex-official Files Illegal Termination Lawsuit GLOBAL CROSSING: Laid-off Workers Treated Unjustly GLOBAL CROSSING: Winnick and Green Linked To Asian Buyout Bid B R A Z I L COPEL: Issuing 5-Yr., US$206-Mln Debentures March 1 C H I L E MINERA CASCADA: New Owner To Decide Future Pending Feasibility J A M A I C A KAISER: Transactions With KJBC Authorized by Bankruptcy Court M E X I C O GRUPO TELEVISA: Seeking Bond Sale To Refinance Debt GRUPO TELEVISA: Analysts Forecast Dismal 4Q01 Earnings GRUPO TELEVISA: Company Profile GRUPO TELEVISA: Fitch Ratings Assigns 'BBB-' MEXLUB: Court Favors Impulsora In Case Against Pemex MINERA AUTLAN: Directors Propose US$186 Mln Debt Restructuring - - - - - - - - - - ================= A R G E N T I N A ================= METROGAS: Late Interest Payment Blamed on Transfer Restrictions --------------------------------------------------------------- Argentine gas distributor Metrogas paid a US$1.6-million interest payment owing on its US$130-million floating-rate notes that was originally due February 7 about eight days late. The Company's payment finally arrived February 15 because of transferability and convertibility restrictions established by the Argentine government, according to international credit rating agency Standard and Poor's in a statement. The Argentine central bank lowered its restrictions on February 8. S&P said Metrogas' credit rating will not be affected by the late payment, however, the ratings agency warned that the Company faces several uncertainties including renegotiations of concessions contracts and the devaluation effect on cash flow. S&P lowered the foreign and local currency ratings of several Argentine companies, including Metrogas, last month to "selective default" (SD) because of the country's economic crisis. The company's current credit rating is CC, with a negative outlook. CONTACTS: METROGAS Alberto Alfredo Alvarez, President William Harvey Adamson, First VP Gen. Director Enrique Barruti, HR Director Fernando Aceiro New Bus. Director Luis Domenech Admin. and Fin. Director Their Address: G. Araoz de Lamadrid 1360 1267 Buenos Aires, Argentina Phone: (800) 422-2066 Fax: (201) 262-2541 Email: info@metrogas.com.ar SCOTIABANK QUILMES: Chief Remains In Country Pending Probe ---------------------------------------------------------- Alan Macdonald, chief executive of Scotiabank Quilmes SA in Buenos Aires, along with 20 or so foreign bankers, were ordered to remain in Argentina pending an investigation into alleged illegal money transfers, according to a report by the National Post Online. An Argentine judge issued the order as the country's economy continued to slip toward chaos. According to the Department of Foreign Affairs in Ottawa, the court order affects five expatriate Canadian bankers employed by Scotiabank. In January, Scotiabank Quilmes defaulted on a US$55-million bond payment after the central bank refused to allow the money to leave the bankrupt South American country, leading to a rating reduction on the subsidiary to default by rating agency Standard and Poor's. Scotiabank Quilmes had the money to pay off the outstanding debt, but did not have approval from Argentina's central bank to transfer the currency outside the country. According to Standard and Poor's, Scotiabank had another scheduled bond payment to meet in February. This latest twist in Scotiabank's tumultuous history in Argentina provides Peter Godsoe, Scotiabank's chairman and chief executive, with yet another incentive to pull the plug on the ailing subsidiary. A complete exit from the country would erase no more than "one quarter's earnings," Mr. Godsoe has said. Such a move would cut the bank's earnings by about $1 per share. Several analysts have speculated that Mr. Godsoe will eventually shut down the unit. The largest components of Scotiabank's billion-dollar exposure to Argentina include US$346-million in high-grade corporate debt and a US$326-million investment in Scotiabank Quilmes. CONTACTS: Alan Macdonald Chief Executive Officer Phone: (54-11) 4338-8000 Fax: (54-11) 4338-8033 Mail: 6th Floor Gral. J.D. Peron 564 (C1038AAL) Buenos Aires Roy D. Scott Vice-President and Managing Director, Latin America Phone: (54-11) 4394-8726 Fax: (54-11) 4328-1901 Mail: P.O. Box 3955 C1000WBN Correo Central Buenos Aires, Argentina E-mail: scotiarep@sinectis.com.ar AUDITORS: KPMG LLP Av. Leandro N. Alem 1050, Piso 2 C1001AAS-Buenos Aires, Argentina +54 (11) 4316 5700 PRICEWATERHOUSECOOPERS LLP Buenos Aires Office Cerrito 268 C1010AAF Buenos Aires Mail Address : Casilla de Correo Central 896 C1010AAF Buenos Aires Argentina Telephone: [54] (11) 4370 6000, 4370 6700, 4370 6900 Telecopier: [54] (11) 4370 6800, 4370 6339 Cordoba Office PricewaterhouseCoopers Boulevard Chacabuco 492 X5000IIR C>rdoba Telephone: [54] (351) 420 2300 Telecopier: [54] (351) 420 2332 ============= B E R M U D A ============= GLOBAL CROSSING: Schiffrin & Barroway, Files Class Action Suit ---------------------------------------------------- Schiffrin & Barroway, LLP announced Thursday that a securities class action lawsuit pending in the U.S. District Court for the Western District of New York (02-CV-6067) claims that Global Crossing, LTD. ("Global" or the "Company") (NYSE:GX) (OTCBB:GBLXQ) misled shareholders about its business and financial condition. Plaintiff seeks damages for violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 on behalf of all investors who bought Global Crossing, LTD. securities between April 28, 1999 and October 4, 2001 (the "Class Period"). The complaint alleges that the New York-based Global Crossing, LTD., during the Class Period, issued false and misleading statements, press releases, and SEC filings concerning Global's financial condition, as well as the Company's ability to generate sufficient Cash Revenue from new revenue sources considering the failing market for broadband access. Prior to the disclosure of Global's true financial condition, the Individual Defendants and other Global insiders sold holdings of Global's common stock for proceeds of more than $149 million. In addition, during the class period defendants caused the Company to sell notes on favorable terms to itself, which generated $1 billion in investor capital. On October 4, 2001 Global announced that Cash Revenues in the third quarter would be approximately $1.2 billion, $400 million less than the $1.6 billion expected by analysts and forecast several times earlier in the year by defendants. In addition, Global and the defendants stated that they expected recurring adjusted EBITDA to be ``significantly less than $100 million'' compared to forecasts of $400 million made several times earlier in the year. Following this series of announcements, Global's share priced plummeted nearly 50% to $1.07 per share on extremely heavy trading volume. Subsequently, with its stock trading at well under a dollar per share of common stock, Global filed for Chapter 11 Bankruptcy protection on January 28, 2002 after becoming unable to service its debt. CONTACTS: SCHIFFRIN & BARROWAY, LLP Marc A. Topaz, Esq. Stuart L. Berman, Esq. 1-888-299-7706 (toll free) (610) 822-2221 E-mail: info@sbclasslaw.com GLOBAL CROSSING: Shareholders To Submit Competing Rescue Plan ------------------------------------------------------------- A group of Global Crossing Ltd. shareholders, which is led by Coburn Meredith, was supposed to file an alternative rescue plan Friday for the telecom network firm that would see investors' holdings intact, but would dispose of its top executives, reports the Associated Press. The plan, which was to be filed with the U.S. Bankruptcy Court in Manhattan, involves raising about US$1 billion by issuing warrants that would guarantee holders the right to buy Global Crossing shares at a set price in the future. Lawyers for the group will try to convince Judge Robert Gerber that there would be sufficient demand for the warrants. Several independent experts called the effort extremely unusual. They expressed doubt the plan would succeed, saying bankruptcy law favors a company and its creditors and that few investors are likely to bet more money on Global Crossing. "This company is very far gone. I don't see any ability to raise equity capital," said Harry DeAngelo, professor of finance at the University of Southern California's Marshall School of Business. Although the shareholders are not trying to buy out Global Crossing, they do want to gain control of the majority of seats on the board. John Schmidt, a spokesman for Global Crossing, said the Company was not aware of the shareholders' efforts but is obligated to consider other offers. O January 28, Global Crossing detailed a bankruptcy plan under which it confirmed shareholders will likely receive nothing. As part of the plan, two Asian firms would receive 79 percent of the Company in return for investing US$750 million. Creditors would jointly own 21 percent and receive US$300 million in return for forgiving about $12.4 billion of debt. A court hearing on the sale procedures is scheduled for March 7. Exactly how much shareholder support the plan will receive is not clear, but many shareholders interviewed said they still believe Global Crossing's fiber optic network linking 27 countries is a winning investment idea. GLOBAL CROSSING: Ex-official Files Illegal Termination Lawsuit -------------------------------------------------------------- Roy Olofson, a former vice president of finance at Global Crossing, plans to file a wrongful termination lawsuit within the next week, his Santa Monica-based lawyer, Brian Lysaght, told Reuters. "We had the lawsuit ready to go before the bankruptcy, but we had to procedurally recast it after the bankruptcy filing," Lysaght said. "It should be filed within a week." Global Crossing has denied Olofson's allegations that it engaged in improper accounting. However, the Company said earlier this month that the SEC, which has lodged investigations into the failed company, had asked it to turn over documents including a letter that Olofson sent in August that questioned certain business practices. Olofson initially voiced concerns about the Company's financial practices in meetings with Joseph Perrone, executive vice president of finance and former outside auditor with Arthur Andersen & Co., Lysaght related. Olofson was concerned that the Company was using aggressive, accounting methods to boost its revenues, his lawyer said. Lysaght said Perrone responded by threatening Olofson with termination. Olofson's concerns -- relating to Global Crossing's first quarter 2001 figures -- were contained in a letter to the Company dated August 2001 that was disclosed after its bankruptcy. Shortly after receiving the letter, Global Crossing said it received another letter from an attorney alleging Olofson had been "constructively terminated" and demanding a multi-million dollar payment. Global Crossing has said Olofson's allegations are "completely without merit" and has described him as an embittered former employee trying to extract a cash settlement. Furthermore, the Company said it did not terminate Olofson until November 30 as part of a substantial workforce reduction. The Company said this month it would form a committee of directors to review Olofson's allegations. Global Crossing, which controls about one-fifth of the fiber optic capacity leaving the United States, is based in Hamilton, Bermuda, but has maintained an executive office in Beverly Hills. GLOBAL CROSSING: Laid-off Workers Treated Unjustly -------------------------------------------------- Upon its bankruptcy filing, Global Crossing cut off severance pay to thousands of laid-off workers. However, according to an article released by the Wall Street Journal, the Company moved up its last pay date by a week to ensure that executives and others still employed could get paid before the telecommunications company declared bankruptcy on January 28. The Company also forgave large loans to executives, including one for US$10 million to Chief Executive John Legere. Global Crossing, in recent months, also has made 11th-hour lump- sum pension payouts totaling US$15 million to high-ranking executives, most of them no longer with the Company. The payments were made after Global Crossing changed the terms of a supplemental pension plan for managers on December 13 to allow them to take a one-time lump-sum payment with a penalty, in lieu of monthly payments, says the Wall Street Journal. The payouts to executives, according to the Journal, were approved by the board of director's compensation committee, which said it used Global Crossing's revenue and cash-flow targets to assess bonuses, but those goals may never have been met. GLOBAL CROSSING: Winnick and Green Linked To Asian Buyout Bid ------------------------------------------------------------- Gary Winnick, Global Crossing Ltd's chairman, and Steven J. Green, a member of the Company's board, arranged a complex side deal with a Singapore investment firm that has ties to an Asian alliance now trying to buy the telecommunications firm out of bankruptcy, reveals the New York Times. The deal, which the two executives conducted without officially informing other board members, as well as creditors and shareholders, may have given them opportunities to benefit in ways not available to other executives or to creditors and shareholders of the giant communications company. The two executives failed to disclose the deal last month when a US$750-million joint offer for Global Crossing's assets was made by Singapore Technologies Telemedia and Hutchison Whampoa. Singapore Technologies is wholly owned by the same government- owned company, Temasek Holdings, which effectively controls the Singapore firm in which Mr. Winnick and Mr. Green invested. In the view of some corporate management and bankruptcy experts, failure to fully notify the board when they made their Singapore deal, or to disclose it in the bankruptcy proceedings, were serious lapses on the part of Mr. Winnick and Mr. Green. Both confirmed the details of their Singapore deal, in which they acquired a 13.4 percent stake in the Singapore investment firm, K1 Ventures, for about US$25 million. However, they insisted there was nothing inappropriate in their handling of the transaction. =========== B R A Z I L =========== COPEL: Issuing 5-Yr., US$206-Mln Debentures March 1 --------------------------------------------------- Brazil's Parana state integrated power company Copel informed the Sao Paulo stock market that it will issue five-year debentures worth US$206.6 million (BRL500 million) starting March 1, says Business News Americas. The move came after shareholders approved the issue at a meeting held Wednesday. According to Business News Americas, Copel will issue 50,000 notes in three series, with a nominal unitary value of US$4.13 million. The first two series will be 10,000 debentures each, and the third 30,000. The debentures will not be convertible into shares and the issue will not have share certificates. The guarantee will be supplied by Copel's five operating units: Copel Geracao, Copel Transmissao, Copel Distribuicao, Copel Telecomunicacoes, and Copel Participacoes. The issue will take place over six months from the date that securities regulator CVM authorizes the register of the issue. The debentures in the first two series will be paid on the expiry date, while interest will be paid twice yearly, on the first working day of March and September each year, through March 2007. In the case of the third series, interest will be paid annually, on March 1 each year. Copel's shareholders approved the debenture issue to roll over maturing debt and finance new investments until 2004. Copel has 17 hydroelectric plants and one thermoelectric plant with a total capacity of over 4,500 megawatts. Market analysts believed Copel ended 2001 with a profit of just BRL148 million compared to the BRL430 million reported in 2000. The Company's debts still stand at BRL1.6 billion, BRL1 billion of which is denominated in foreign currency. 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 ========= C H I L E ========= MINERA CASCADA: New Owner To Decide Future Pending Feasibility -------------------------------------------------------------- The Halderman mining company's decision to proceed with a US$24- million plan to revive the La Cascada copper mine in northern Chile's Region I awaits the results of the feasibility studies to be done during the second quarter of this year, reports Business News Americas. At present, Haldermann's exploration to confirm reserves is expected to conclude by April. The plan involves building a Solvent Extraction (SX) and Electro-winning (EW) plant to produce a nominal 19,000t/y of copper cathodes. If the go-ahead is given, construction work will start in 2003 and production in 1Q04. Operations at the exotic copper deposit La Cascada were halted in July 2000 when its previous owner, Minera Pudahuel, declared Cascada bankrupt. But Chile's Halderman acquired the assets in August of that same year with a plan to revive SX-EW operation. ============= J A M A I C A ============= KAISER: Transactions With KJBC Authorized by Bankruptcy Court ------------------------------------------------------------- Kaiser sought and obtained entry of an interim order authorizing them to continue ordinary course transactions with, and pay prepetition claims of their non-debtor joint venture affiliates. According to Joseph Bonn, the Debtors' Executive Vice President, in the ordinary course of their businesses, the Debtors, either directly or through certain non-debtor subsidiaries, engage in transactions with the Joint Ventures. The Joint Venture Transactions are governed by constituent documents, which are different for each Joint Venture but, in general, the Joint Venture Transactions share the same basic structure. The Debtors fund the cash costs of the Joint Ventures for raw materials, labor and other operational costs, as well as capital expenditures, taxes, debt service and working capital in order to continuously source the global production and delivery requirements. Mr. Bonn states that the obligations of the Debtors and the Joint Ventures generally are unconditional and failure to take products or fund costs generally is a default under the relevant Joint Venture agreements, which, in turn, could enable the Joint Venture partners to claim forfeiture of the Debtors' interests. The Debtors and their nondebtor affiliates maintain detailed records with respect to all transfers of cash to the Joint Venture so that all the Joint Venture Transactions and any transactions with nondebtor affiliates related thereto, may be readily ascertained, traced and recorded properly. A description of the Joint Ventures and certain of the Joint Venture Transactions are as follows: A. Kaiser Jamaica Bauxite Company (KJBC): Kaiser Bauxite Co. (KBC) manages KJBC and, through a KJBC bank account, pays all costs incurred by KJBC in its operations. KBC, in turn funds these costs plus its own costs through monthly cash calls to the Debtors, ranging from $5,000,000 to $9,000,000 a month. For fiscal year 2002, the cash calls are anticipated to be approximately $90,000,000 and will enable the Debtors to generate revenue of $250,000,000 from alumina production at Gramercy and bauxite sales to third patties. Approximately $7,000,000 of cash calls will come due in the next 30 days, as part of the ongoing ordinary production cost structure. B. Alumina Partners of Jamaica (Alpart): The amounts required to be paid pursuant to the various Alpart agreements, for their shares of Alpart's operating costs, working capital requirements, capital expenditure requirements and debt service are funded by daily cash calls from Alpart to Kaiser Jamaica Corp. (KJC) and Alpart Jamaica Inc. (AJI). Although the amount of the cash calls can vary considerably, the amounts typically range from $13,000,000 to $15,000,000 per month. Production sales and delivery by Alpart enable the Kaiser Companies to realize $18,000,000 a month. Approximately $17,000,000 of cash calls will come due in the next 30 days, as part of the ongoing ordinary production cost structure. C. Queensland Alumina Limited (QAL): QAL collects the tolling charges and other cash requirements through periodic cash calls on the participants. Kaiser Australia receives cash calls from QAL five or six times a month in amounts that typically range from $6,000,000 to $8,000,000 per month. The cash calls generally aggregate approximately $90,000,000 to $100,000,000 per year, and through product sales and delivery enable the Kaiser Companies to realize approximately $120,000,000 a year. To fund the cash calls, cash is wired from KACC's Disbursement Account to Kaiser Australia's operating account and then to QAL. Some of the tolling charges constitute prepayments for QAL's costs and some tolling charges are for costs QAL has already incurred. The Debtors estimate that cash calls of approximately $8,000,000 will come due in the next 30 days, attributable to ordinary production costs in the current cycle. D. Volta Aluminium Company Limited (Valco): Four or five times per month, Valco makes cash calls to KACC and Reynolds for tolling charges. To fund KACC's cash calls, cash is wired from KACC's Disbursement Account to a Valco trust account in New York. The amount of tolling charges averages approximately $10,000,000 million per month while the annual aggregate cash calls approximate $160,000,000, generating $230,000,000 in product revenues for the Kaiser Companies. The Debtors estimate that approximately $15,000,000 in tolling charges will be due in the next 30 days, attributable to ordinary production costs incurred. E. Anglesey: Under the metal take-or-pay agreement, KACC receives invoices from Anglesey for its 49% of Anglesey's output once a month, which it pays at the end of the following month. To fund the payment of invoices, cash is wired from KACC's Disbursement Account to an account of KAII in the United Kingdom and then wired to Anglesey. In 2001, KACC's share of Anglesey's costs for metal production totaled $102,000,000. In 2002, KACC'S share of costs is expected to range from $8,000,000 to $9,000,000 per month with the Kaiser Companies anticipating in excess of $110,000,000 in related revenues over the same period. The Debtors estimate that approximately $8,100,000 will be due in the next 30 days. In the ordinary course of business, Daniel J. DeFranceschi, Esq., at Richards Layton & Finger in Wilmington, Delaware, believes that the Debtors will be called upon to participate in Joint Venture Transactions following the Petition Date. Because the Debtors engaged in the Joint Venture Transactions on a regular basis prior to the Petition Date and such transactions are common among enterprises like the Debtors and their nondebtor affiliates, the Debtors believe that the Joint Venture Transactions are ordinary course transactions and do not require the Court's approval. Mr. DeFranceschi relates that the production, shipping and sales revenues of the Kaiser Companies is dependent in material part upon a continuation, without interruption, of the production and shipping of bauxite and alumina from the Production Ventures to the Kaiser Companies. Without continued timely delivery of bauxite and alumina, on the current "as needed" or "just in time" basis, Kaiser's operations would be impaired. The relief sought maintains the Debtors' operations as in the ordinary course and, significantly, also maintains the positive cash flow that the Production Ventures generate for the Debtors. Mr. DeFranceschi contends that continuation of the Joint Venture Transactions is essential for the Joint Ventures to continue operations in some cases and for certain of Kaiser's operations to continue and for the Debtors to retain their interests in the Joint Ventures. Because the Joint Ventures are critical to the Debtors' ability to reorganize, the Debtors submit that the continuation of the Joint Venture Transactions is in the best interests of the Debtors' respective estates. Although the Debtors have made all payments in respect of Joint Venture Transactions that came due prior to the Petition Date, Mr. DeFranceschi submits that a portion of certain Joint Venture Transaction obligations that will come due after the Petition Date will have accrued prior to the Petition Date. The Debtors seek authority to pay all Joint Ventures Claims and estimate that the aggregate amount required for funding the Joint Ventures is approximately $64,000,000 over the next 30 days. Mr. DeFranceschi points out that the Joint Ventures generate substantial revenues, cash flow and other benefits for the Debtors and are critical to the preservation and enhancement of the Debtors' respective values as going concerns. The Debtors Joint Ventures constitutes an essential component of the Debtors' global network of production facilities and raw materials sources. Moreover, the transportation costs for alternative sources of bauxite would substantially exceed current costs, and because there is limited worldwide bauxite mining capacity, alternate suppliers of bauxite could require the Debtors to advance funds to finance mining expansion costs. If Kaiser were forced to switch to another bauxite source, Mr. DeFranceschi maintains that Kaiser's operations would be curtailed and losses would ensue. The Debtors' operations at non-debtor joint venture smelter facilities similarly are dependent upon the low-cost alumina from the Alpart and QAL refinery operations. These smelters carry only small reserve stocks of alumina and may not be able to replace the supply of alumina from Alpart and QAL in time to avoid a costly shutdown. Furthermore, the Debtors' interests in the Joint Ventures have significant value even apart from the fact that the output from the Joint Ventures is integral to certain of the Debtors' other production facilities. The Debtors sold an 8.3% interest in QAL in September of last year for approximately $189,000,000 of aggregate consideration. Mr. DeFranceschi claims that the Debtors' interests in the Joint Ventures, however, may be jeopardized if the Debtors are not permitted to continue in the ordinary course to make payments for which they are unconditionally obligated. The Debtors generally are responsible for paying a significant share of the operating costs, working capital, capital expenditure and debt services costs for each of the Joint Ventures. If the Joint Ventures are not able to meet their financial obligations and creditors seek recourse against their assets, little if anything would be left to recoup the Debtors' substantial investments in the Production Ventures. Mr. DeFranceschi tells the Court that the Debtors' failure to make payments pursuant to their obligations would also, under certain of the agreements that govern the rights and obligations of the parties to the Joint Ventures, potentially allow the other partners or shareholders of the Joint Ventures to terminate the Debtors' interests by electing to redeem the Debtors' partnershipor shareholder interest or dissolve the Joint Venture altogether. Although the automatic stay applies with respect to any actions taken against the Debtors or their interests in the Joint Ventures, certain of the Debtors' Joint Venture partners are foreign entities without significant operations or assets in the United States. Accordingly, if the Debtors are in default under the respective Joint Venture Agreements for failure to pay joint venture claims, certain of the Debtors' Joint Venture partners, considering themselves beyond the reach of the United Slates legal system, might seek remedies against the Debtors in a foreign jurisdiction. Because it is uncertain whether such foreign jurisdictions would give effect to the automatic stay imposed under the Bankruptcy Code, the Debtors' interests in the Joint Ventures would be placed at risk, which, in turn, would severely undermine the Debtors' ability to reorganize. (Kaiser Bankruptcy News, Issue No. 2, Bankruptcy Creditors' Service, Inc., 609/392-0900) =========== M E X I C O =========== GRUPO TELEVISA: Seeking Bond Sale To Refinance Debt --------------------------------------------------- Grupo Televisa SA, Mexico's largest broadcaster, plans to sell $250 million in 20- or 30-year bonds on the international market to refinance its debt, according to a Bloomberg report. The Mexico City-based company, which has about US$1.4 billion in debt, plans to price the debt next week. It has hired J.P. Morgan Chase & Co., Citigroup Inc.'s Salomon Smith Barney and Deutsche Bank AG to manage the sale. Standard & Poor's gave the debt a `BB+' rating, one notch below investment grade. CONTACTS: J.P. MORGAN CHASE & CO. Investor Relations: 270 Park Avenue New York, NY 10017-2070 (1-212) 270-6000 www.jpmorganchase.com SALOMON SMITH BARNEY 388 Greenwich Street 18th Floor New York, NY 10019 (212)723-9923 www.salomonsmithbarney.com DEUTSCHE BANK AG Taunusanlage 12 Tower A D-60325 Frankfurt am Main Germany Tel.: +49-69-910-38080/35395 Fax: +49-69-910-38591 E-mail: db.ir@db.com DEUTSCHE BANK AG 31 West 52nd Street 29th Floor New York, NY 10019-6160 USA Tel.: +1-212-469-7125 Fax: +1-212-469-7322 E-mail: db.ir@db.com GRUPO TELEVISA: Analysts Forecast Dismal 4Q01 Earnings ------------------------------------------------------ Grupo Televisa is expected to post dreary fourth quarter earnings come Monday, February 25 as a result of its weak performance in its radio and music divisions, and a slipping television audience share that impacted advertising. A Reuters poll of five analysts gave an average forecast for Televisa fourth-quarter revenues of MXN6.237 billion, almost flat from the fourth quarter of 2000, while operating profit was seen down almost 10 percent. Analysts predict that income from the firm's broadcasting business would fall as much as 3 percent in the fourth quarter and that profit margins would also slump at the broadcasting unit, partly because of Televisa's loss in the TV ratings in the quarter. The Reuters poll forecast Televisa's consolidated operating profit falling 9.69 percent in the fourth quarter to MXN1.584 billion, while the operating margin would shrink to 25.40 percent, compared with 28.02 percent a year earlier. The poll also forecasts a 5.6 percent drop in EBITDA (earnings before interest, taxes, depreciation and amortization). In Late December, Televisa sold its struggling Fonovisa music label to U.S. Spanish-language broadcaster Univision. However, those results will still be included in the fourth quarter. Analysts saw a significant drop in revenues at the music division, as well as at Televisa's chain of radio stations, which is part-owned by Spain's Prisa, in the fourth quarter. However revenues may grow at the publishing and cable divisions, analysts said. "Due to the lackluster performance of Televisa's non-core operations, the company has not been able to turn around profitability in 2001," said analyst Rene Pimentel of Deutsche Banc. GRUPO TELEVISA: Company Profile ------------------------------- NAME: Grupo Televisa, S.A. Av. Vasco de Quiroga No. 2000 Colonia Santa Fe 01210 Mexico, D.F., Mexico PHONE: (525) 261-2000 WEBSITE: www.televisa.com EXECUTIVE MANAGEMENT TEAM: Emilio Azcarraga Jean Chairman, President & CEO Alejandro Burillo Azcarraga, Vice Chairman TYPE OF BUSINESS: Grupo Televisa S.A. (NYSE: TV) is a producer and broadcaster of Spanish-Language television programming, with interests in television production, broadcasting, satellite services, publishing, music recording, professional sports, paging services and dubbing. The Company also owns an equity interest in Univision Communications, Inc., a Spanish-language television broadcaster in the United States. SIC: Television Broadcasting Stations [4833] EMPLOYEES: 14,700 TOTAL ASSETS: US$4,420.1 (in millions, as of 9/30/01) TOTAL LIABILITIES: US$2,401.8 (in millions, as of 9/30/01) REVENUES: US$577.0 (in millions, as of 9/30/01) GRUPO TELEVISA: Fitch Ratings Assigns 'BBB-' -------------------------------------------- Fitch Ratings has assigned a 'BBB-' foreign currency rating for Grupo Televisa, S.A. de C.V (Televisa). The Rating Outlook is Stable. The foreign currency rating incorporates transfer and convertibility risks of foreign currency denominated obligations. The rating reflects Televisa's position as the leading television broadcaster in Mexico and its dominance in Spanish-language programming on a global scale. The rating also reflects Televisa's growing presence in the Latin American cable/Direct to Home (DTH) satellite sectors and its position as one of the largest media and entertainment companies in Latin America. Although Televisa has an extremely diverse portfolio, its Mexican television broadcast business is expected to remain the largest contributor to both revenue (58%) and EBITDA (86%). Televisa has maintained its dominance in the television sector through continually improving its programming quality, restructuring its advertising strategy and pricing, and also through its strong distribution channels over its television network. Fitch expects this dominance to continue in the Mexican television broadcast sector over the foreseeable future despite increased competition experienced in recent years from TV Azteca. Increased competition in the television broadcast sector may modestly pressure operating margins and result in further modest market share losses over the medium term. Televisa has the largest television broadcast network in Mexico with four wholly owned stations in Mexico City, 120 wholly owned or partially owned affiliates and 86 non-affiliates which broadcast its programming. Televisa is one of the world's leading producers of Spanish- language programming. The company produced 47,000 hours in 2000 for its network, cable and DTH satellite businesses. Televisa licenses its programs and associated rights to Mexican and foreign TV broadcasters and non-Televisa related networks in approximately 90 countries. Televisa licensed over 68,000 hours in 2000 to non-Televisa related operators. Programming represents approximately 10% of total revenues. The company provides the majority of programming for Univision, the largest Spanish-language network in the United States. A recent multi-layered agreement with Televisa should moderately enhance revenues over the longer term which essentially provides Univision with exclusive rights to Televisa programming through 2017 in exchange for higher licensing fees and royalties on sales and a greater equity stake in Univision, which increased from 5% to approximately 15%. Also, Televisa will become more closely tied to Univision through a commitment to create a joint venture to introduce Televisa's satellite and pay TV programming to the U.S. Hispanic market. Over the longer term, Televisa should increasingly benefit from its diverse portfolio both in and outside of Mexico. Televisa's other businesses generally have strong market shares in their respective segments. These investments include a 51% interest in Cablevision (the largest cable operator in Mexico), a 60% interest in a DTH satellite venture with operations in Mexico and a 30% interest in a DTH satellite venture with operations in Argentina, Chile, and Colombia. Both sectors provide additional venues for the distribution of the highly rated Televisa produced programming which enhances opportunities to increase subscriber and advertising sales for those investments. Although the current contribution from cable TV and DTH is modest, under 10% of total sales, the revenue contribution from those segments should moderately increase going forward due to strong subscriber growth. Televisa is also a leading publisher and distributor of Spanish language magazines. Other businesses include radio production and broadcasting, professional sports teams, show business promotions, film production and distribution, language dubbing, paging services, and an Internet portal. Credit fundamentals are expected to remain solid and consistent with the 'BBB-' foreign currency rating category. Expected pressure on financials should be partially offset by cost reduction measures and greater operating efficiencies. Expected 2001 debt/EBITDA and EBITDA/interest of 2.4 times (x) and 4.5x, respectively, are consistent for the rating category and are anticipated to remain so over the foreseeable future. Although the company has a diversified portfolio of investments, the majority of revenues are peso-denominated while approximately 68% of total debt is U.S. dollar-denominated. Televisa is continuously analyzing hedging alternatives in order to mitigate foreign currency risk. Over the longer term, EBITDA generated from outside of Mexico should further modestly mitigate the foreign currency risk. In September 2001, Televisa successfully placed a US$300 million 10-year bond in the international debt capital markets and used the proceeds to repay 75% of a $400 million U.S. dollar-denominated syndicated loan. Additionally, in 2000 Televisa issued a MXP $3.0 billion bond in the Mexican market. Both actions have improved the debt profile by either decreasing the foreign currency exposure and/or increasing the average maturity of debt. CONTACT: Fitch Ratings Randy Alvarado, 312/368-3117 or Daniel R. Kastholm, 312/368-2070 (Chicago) Media Relations: James Jockle, 212/908-0547 (New York) MEXLUB: Court Favors Impulsora In Case Against Pemex ---------------------------------------------------- The federal courts conceded Wednesday a provisional suspension to Impulsora Jalisciense in its case against Petr�leos Mexicanos (Pemex) for the termination of contracts based on the company's co-investments with Pemex, reports Mexico City daily El Universal. As a result, Pemex cannot change its franchise contracts with service stations, nor end the exclusivity agreement with Mexicana de Lubricantes (Mexlub) in its service station franchises. Impulsora claimed that rescinding its contracts to supply basic oils and the licensing to use Pemex brands for oils and lubricants has damaged its net worth. Impulsora officials said that Pemex's decision to cancel the contracts was arbitrary. In 1992, the Chemical Compounds Industrial Group won the bid to create the Mexlub company through Impulsora Jalisciense. CONTACT: Octavio S nchez Mejorada, Manager Av. 8 de Julio N 2270, Z.I. Guadalajara, Jal. 44940 Phone: 31-34-05-00 Fax: 31-34-05-00 E-mail: export@mexlub.com.mx URL: http://www.mexlub.com.mx MINERA AUTLAN: Directors Propose US$186 Mln Debt Restructuring -------------------------------------------------------------- Directors of the beleaguered Mexican manganese company Minera Autlan have met with representatives from its creditor banks to present a plan to restructure US$186 million in debt, reports Business News Americas. The creditor banks are led by ABN Amro, BBVA Bancomer and Bank of Montreal. Autlan, which mines manganese ore and produces manganese alloys and pellets used in specialty steels, saw its net sales plummet more than 30 percent in 2001 due to world steel crisis, as well as a shrinking of the local and US markets. Due to weakening net sales, the Company had to temporarily mothball operations at its mines in western Mexico and cut production at its Gomez Palacio and Tezuitlan pellet plants. Autlan hired France's Paribas in 2001 to head the search for a "strategic investor" to help it out of its debts and strengthen its financial situation. Brazilian minerals and transport house CVRD was rumored to be considering making an investment in Autlan, but has not confirmed this. CREDITOR BANKS: BANK OF MONTREAL 100 King Street West 1 First Canadian Place, 18th Floor Toronto, ON M5X 1A1 Tel: 416-867-6656 Fax: 416-867-3367 Email: investor.relations@bmo.com URL: www.bmo.com GRUPO FINANCIERO BBVA BANCOMER Av. Universidad 1200, Col. Xoco, M�xico, D.F. Tel: (52) (55) 5621-4938 (52) (55) 5621-4966 Fax: (52) (55) 5621-7912 Email: investor.relations@bbva.bancomer.com Contacts: David S nchez-Tembleque ABN AMRO Investor Relations(HQ1191) Gustav Mahlerlaan 10 PO Box 283 1000 EA Amsterdam The Netherlands Tel. +31 (0) 20 628 78 35 Tel. +31 (0) 20 628 78 37 Email: investorrelations@nl.abnamro.com *********** 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. 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. 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