/raid1/www/Hosts/bankrupt/TCRLA_Public/020308.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
L A T I N A M E R I C A
Friday, March 8, 2002, Vol. 3, Issue 48
Headlines
A R G E N T I N A
ANDRE & CIE: Bunge Completes La Plata Cereal Acquisition
BANCO GALICIA: Turning To Creditors, Investors For Bailout
BGN: VP Detained On Argentine Judges Orders
SCOTIABANK QUILMES: Judge Orders Raid
SIDERAR: One-Time Charge On Venezuelan Investments, Losses Widen
TGS: 4Q01 Results Fall Short, YE Audited Results Delayed
B E R M U D A
GLOBAL CROSSING: Court Postpones Hearing On Objections To Bid
GLOBAL CROSSING: Los Angeles-based Firm To Make Offer Next Week
GLOBAL CROSSING: Sues XO For Cutting Off Network Access
B R A Z I L
TELEMAR: Higher-Than-Expected 2002 Debt Outlook Weighs On Shares
VARIG: To Sell 20% Stake To Raise Capital
VARIG: Gripen Signs MoU With VEM-Varig
C H I L E
TELEX-CHILE: Redes Opticas Announces Cash Tender Offer For Stock
C O L O M B I A
SEVEN SEAS: YE01 Reserves Stable, NPV Down With Oil Prices
M E X I C O
BANCA QUADRUM: Liquidation To Cost IPAB MXN977 Mln
GRUPO ALFA: Shares Up As US Tariff Hike Exempts Mexico
GRUPO MEXICO: Asarco Faces Penalties Over Environmental Issues
GRUPO MEXICO: Workers Lodge Strike To Protest Wage Proposal
TRI-NATIONAL DEV: Signs Marketing Agreement With Coastal Pacific
P E R U
AEROCONTINENTE: Sues Chilean Government For Causing Losses
U R U G U A Y
FUNSA: Calls In Receivers Following Sharp Drop On Exports
- - - - - - - - - -
=================
A R G E N T I N A
=================
ANDRE & CIE: Bunge Completes La Plata Cereal Acquisition
-----------------------------------------------------------
In an official company press release, Bunge Limited (NYSE: BG)
announced Monday that it has closed its acquisition of La Plata
Cereal S.A., a leading Argentine agribusiness company, for a
maximum enterprise value of US$50 million in cash and assumed
debt. The acquisition is in line with Bunge's stated strategy of
pursuing selective acquisitions to expand its core businesses in
key growth markets. Bunge expects the acquisition to be
accretive to earnings in the second quarter of 2002.
Bunge acquired La Plata from Andre & Cie S.A., the Swiss
agribusiness company, which has been shedding assets since filing
for protection from creditors in March 2001 after losing almost
half a billion dollars in two years.
Bunge claims this acquisition makes it the largest soybean
processor and the second largest exporter of agricultural
products from Argentina, both based on volumes. The acquisition
also expands Bunge's fertilizer business, which is already the
largest producer and supplier of fertilizer in South America
based on volumes, into Argentina.
As a result of the acquisition, Bunge Argentina's soybean
crushing capacity will increase 83% to 4.4 million metric tons
per annum (1). Bunge believes that its grain and soybean export
volume will increase 81% to 2.9 million metric tons per annum.
"Despite the recent financial difficulties faced by Argentina,
the country is still the world's low-cost producer of grains and
oilseeds," stated Alberto Weisser, chairman and chief executive
officer of Bunge Limited. "The acquisition enhances our already
strong position in this critical export origin."
"La Plata's businesses and asset mix are highly complementary to
our existing infrastructure," stated Raul Padilla, president and
chief executive officer of Bunge Argentina. "The integration of
La Plata with Bunge Argentina will produce a powerful grain
origination, soy processing and export platform and will
establish a solid foothold for Bunge in the Argentine fertilizer
market."
Similar to Bunge's existing business in Argentina, La Plata has
been primarily an export company, shipping grains and oilseed
products to Europe and Asia.
Bunge has operated in Argentina since 1884.
About La Plata Cereal
La Plata Cereal, one of the largest agribusiness companies in
Argentina, operates in four distinct lines of business: grain
origination (soybeans, corn and wheat), soybean processing,
fertilizer and ports and logistics. The company was founded in
1927. La Plata's facilities include six interior grain
elevators, one soybean processing plant with two lines, a wholly-
owned port facility in Puerto San Martin and a branded fertilizer
business with a 10% market share in Argentina and over 4,000
farmer customers.
La Plata's grain and soybean origination facilities are divided
equally between the primary soybean producing province of Salta
and the primary wheat producing province of Buenos Aires. La
Plata's soybean crushing plant is located along the Parana River,
the principal export waterway of Argentina. La Plata owns a port
facility located at Puerto San Martin, adjacent to its soybean
processing facilities.
About Bunge
Bunge is an integrated, global agribusiness and food company
operating in the farm-to-consumer food chain with primary
operations in North and South America and worldwide distribution
capabilities.
(1) During FY 2001, Bunge Argentina crushed 1 million metric
tons of soybean products through a toll crushing agreement with
La Plata.
CONTACT: Stewart Lindsay of Edelman Public Relations for Bunge
Tel. +1-212-704-4435
BANCO GALICIA: Turning To Creditors, Investors For Bailout
----------------------------------------------------------
Argentina's Banco de Galicia y Buenos Aires SA, which has been
pummeled by a run on deposits amid nationwide financial chaos,
has asked for US$800 million from creditors and investors in
order to survive the current financial difficulty.
According to a report by Bloomberg, the Grupo Financiero Galicia
unit has asked international creditors and investors to convert
US$600 million of loans into shares and provide another US$200
million in cash to provide liquidity.
Among the banks interested in taking a stake in Galicia are
Argentina's largest mortgage lender Banco Hipotecario SA, Banco
Velox SA, an Argentine bank, Uniao de Bancos Brasileiros SA,
Brazil's sixth-largest bank and Spain's Banco Bilbao Vizcaya
Argentaria SA and Santander Central Hispano SA.
Goldman Sachs is helping the Company seek a possible buyer.
As of November, Galicia, Argentina's third largest bank, had more
than a third of its ARS10.8 billion (US$5.1 billion) in defaulted
government debt. It has borrowed more than ARS2 billion from the
central bank to meet deposit withdrawals.
CONTACTS: BANCO DE GALICIA Y BUENOS AIRES
Teniente General Juan D. Peron 456, Piso 3
1038 Buenos Aires, Argentina
Phone: +54-11-4343-7528
BANCO HIPOTECARIO SOCIEDAD ANONIMA
151 Reconquista
Buenos Aires, Argentina
Phone: +54 011 4347 5546
http://www.hipotecario.com.ar
BANCO VELOX S.A
Sarmiento 532 (1041) Capital Federal
Buenos Aires
Phone: 4321-1800
Fax: 4321-1820
E-mail: mailto:servicioalcliente@velox.com.ar
Home Page: http://www.bancovelox.com.ar/
Contacts:
Juan Peirano, President
Carlos Peterson, Representative
UNIBANCO-UNIAO DE BANCOS BRASILIEROS S.A.
Av. Eusebio Matoso 891, 15th Floor
Sao Paulo 05423, Brazil
Phone: +55-11-3097-1313
Fax: +55-11-3813-6182
Home Page: http://www.unibanco.com/
Contacts:
Pedro Moreira Salles, Chairman
Cesar A. Sizenando Silva, EVP & CFO
BANCO BILBAO VIZCAYA ARGENTARIA, S.A.
Gran Via, 1
48001 Bilbao, Vizcaya, Spain
Phone: +34-94-487-55-55
Fax: +34-94-487-61-61
Home Page: http://www.bbv.es
Contacts:
Francisco Gonzalez Rodriguez, Chairman
Jose Ignacio Goirigolzarri, CEO
Angel Cano, CFO
SANTANDER CENTRAL HISPANO S.A.
Plaza de Canalejas,1
28014 Madrid, Spain
Phone: +34-91-558-10-31
Fax: +34-91-552-66-70
Home Page: http://www.bsch.es
Contacts:
Emilio Botin-Sanz, Chairman
Jose Luis del Valle, EVP Finance
GOLDMAN SACHS
85 Broad Street
New York, New York 10004
Phone:(212) 902-1000(P)
www.gs.com
BGN: VP Detained On Argentine Judges Orders
--------------------------------------------
An Argentine judge charged a bank executive on Wednesday with
masterminding an alleged money-laundering scheme, ordering him
detained as the investigation continues, Reuters reports citing
court officials.
Federal Judge Maria Servini de Cubria said Carlos Rohm, vice
president at Banco General de Negocios SA (BGN), committed
economic subversion by moving deposits outside the country from
the Buenos Aires-based bank, Rohm's lawyers said in a statement.
Attorneys at the Argentine law firm Estudio Iribarren, in a
statement, said Rohm plans to appeal the judge's decision Friday.
BGN is majority-owned by Credit Suisse First Boston, J.P. Morgan
Chase & Co. and Dresdner Bank AG.
In January, J.P. Morgan told the Argentine central bank that BGN
may have been involved in fraud. The three international banks
also own a bank in Uruguay that is at the center of a separate
fraud investigation.
Uruguay has alleged that fraudulent bond purchases drained US$125
million from the bank, Banco Comercial SA, forcing the government
and the bank's international owners to bail it out.
Carlos Rohm and his brother Jose Rohm were board members of the
Uruguayan bank and are vice president and president,
respectively, of the Argentine bank.
Credit Suisse First Boston, Dresdner and J.P. Morgan Chase own
about two-thirds of the Buenos Aires bank, though they control
only a minority of voting shares. The three firms also own and
control the Uruguayan bank.
Argentina's Radio Diez reported that Servini de Cubria has
ordered the seizure of as much as ARS100 million (US$48 million)
of Carlos Rohm's assets.
CONTACTS: BANCO GENERAL DE NEGOCIOS SA
Esmeralda 120
Capital Federal 1035
Buenos Aires, Argentina
Phone: 011-4394-3003
Fax: 011-4320-6138
Email: interbank@bancobgn.com
URL: http://www.bancobgn.com
CREDIT SUISSE GROUP
P.O. Box 1
CH-8070 Zrich
Tel. +41 (1) 212 16 16
Fax. +41 (1) 333 25 87
Contact: Lukas Muehlemann, chairman & CEO
J.P. MORGAN CHASE & CO.
Investor Relations
J.P. Morgan Chase & Co.
270 Park Avenue
New York, NY 10017-2070
(1-212) 270-6000
URL: www.jpmorganchase.com
DRESDNER BANK LATEINAMERIKA AG
Neuer Jungfernstieg 16
20354 Hamburg, Germany
Tel.: (+49 40) 3595-0
Fax: (+49 40) 3595 3314
Telex: 214 236-0 dl d
S.W.I.F.T. DRES DE HL
E-Mail: public-relations@dbla.com
SCOTIABANK QUILMES: Judge Orders Raid
-------------------------------------
Argentine judge Mariano Berges ordered two raids on Bank of Nova
Scotias subsidiary in the country, Scotiabank Quilmes -- one was
on Monday and the other last Thursday.
He was the same judge, who forbade executives from Scotiabank
Quilmes and several other banks from leaving the country two
weeks ago. Some of them will have a chance to argue against the
investigation and the travel ban next week, court sources said.
Judge Berges has summoned them to appear before him as part of
his investigation into alleged fraud of depositors.
A lower-level criminal-court judge, Berges began investigating
the banks after a woman complained about not having proper access
to her savings at her branch. Although the branch was not part of
the Scotiabank Quilmes chain, the judge is investigating all the
banks where the woman held accounts. So far, no charges have been
filed, nor documentation made public.
Alan Macdonald, chief executive officer of Scotiabank Quilmes,
and, Bill Sutton, Bank of Nova Scotia's head of Latin America,
are scheduled to appear in court on Tuesday, March 12.
Mr. Sutton has avoided the travel ban because he was in Toronto
where he lives and works when the ban was put in place. It's not
clear whether he will go to Argentina for the court appearance,
and risk being stuck inside the country indefinitely.
CONTACTS: SCOTIABANK QUILMES
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
SIDERAR: One-Time Charge On Venezuelan Investments, Losses Widen
----------------------------------------------------------------
A slump in demand and a move to take a one-time charge for
investments in Venezuela have brought deepening losses at Siderar
Saic, Argentina's second largest steelmaker for the second
quarter ended December 31, 2001.
According to a Bloomberg report, net losses at the company, which
makes flat steel panels for cars, domestic appliances and
construction companies, deepened to ARS83.9 million (US$40.5
million), from ARS18.1 million a year earlier.
Siderar's sales fell as high interest rates, a four-year long
economic slowdown and rising unemployment cut consumer spending
in Argentina and reduced demand for its steel products combined
for a trifecta of financial difficulty for the company.
Every business area for Siderar is connected to an industry in
real trouble, said Eugenia Benitez, an analyst at Allaria
Ledesma & Cia. It can't hope its earnings will recover until
Argentina's economy improves.
Siderar said it took a ARS46.9-million, one-time charge on its
investment in Venezuelan steelmaker Siderurgica del Orinoco.
For the six months ended Dec. 31, revenue fell 32 percent to
ARS317.6 million from ARS464.4 million a year earlier. Total
first-half steel shipments fell 5.6 percent to 781,000 tons from
828,000. Domestic first-half shipments fell 26 percent to 371,000
tons from 500,000 a year earlier.
Commenting on the U.S. government's decision not to impose
tariffs on steel imports from Argentina, Gustavo Neffa, an
analyst at BBVA Banco Frances SA, said: This is extremely
favorable, great news, for Argentine steelmakers, but Siderar is
so badly hobbled by the car and construction sector that it may
cancel out any benefits from the exemption.
U.S. President George W. Bush announced a decision Tuesday to
impose tariffs of up to 30 percent on steel imports for three
years in an effort to protect the ailing U.S. industry.
Argentina, which provides only about 3 percent of U.S. steel
imports, as well as other developing nations and members of the
North American Free Trade Agreement are exempted from the duties,
which take effect March 20.
TGS: 4Q01 Results Fall Short, YE Audited Results Delayed
--------------------------------------------------------
Transportadora de Gas del Sur S.A.("TGS" or "the Company") NYSE:
TGS, MERVAL:TGSU2, Argentinas leading transporter of natural
gas, today announced results for the fourth quarter and year
ended December 31, 2001. The Company reported net income for the
fourth quarter of 2001 of Ps. 2.0 million or Ps. 0.003 per share
(Ps. 0.013 per ADR) which compares to Ps. 35.0 million or Ps.
0.044 per share (Ps. 0.220 per ADR) reported for the same period
of 2000. For the year-ended December 31, 2001, TGS reported net
income of Ps. 108.4 million or Ps. 0.136 per share (Ps. 0.682 per
ADR) as compared to Ps. 126.3 million or Ps. 0.159 per share
(Ps. 0.795 per ADR) reported in the previous year.
While the Companys overall internal performance for the year
2001 met our business expectations, the gas transportation
revenues for both the fourth quarter and the year ended December
31, 2001, did not meet our initial estimates, as a result of
external circumstances. Considering the recently issued law and
Decrees affecting the natural gas regulatory framework, TGSs
Board of Directors has decided to reverse the accrued US Producer
Price Index (US PPI) tariffs adjustments recorded during 2001
and 2000, as stipulated in the License. Still, this reversal does
not under any circumstances imply any waiver of our rights, said
Eduardo Ojea Quintana, Chief Executive Officer for TGS. For the
future, we believe that the difficult economic conditions in
Argentina will continue to negatively impact our Company, due not
only to the material changes introduced by the new economic
legislation but also to the regulatory framework that governs the
natural gas industry. Nonetheless, we believe that a final
agreement will be reached between the Argentine Government and
the gas licensee companies, Mr. Ojea Quintana added.
Financial information for the fourth quarter and year ended
December 31, 2001 has been prepared considering an exchange rate
of Ps. 1 = US$ 1, as provided by Resolutions issued both by the
Buenos Aires Professional Councils in Economic Sciences and
Argentine Securities Commission (CNV). However, the new Public
Emergency and Amendment to Foreign Currency Regime Law, passed
in early January 2002, introduced material changes to the
economic rules and regulatory framework, significantly affecting
TGSs business. Changes brought about by the Law include the
amendment of the Convertibility Law and the abandonment of the
fixed exchange rate of Ps. 1 = US$ 1, the conversion into pesos
of gas transportation tariffs, at the mentioned rate which were
dollar-denominated according to the License, and the prohibition
to adjust tariffs according to the US PPI. As a preliminary
result of such new rules, TGSs revenue stream is peso-
denominated, while almost all of its financial agreements are
dollar-denominated. As of March 1, 2002 the rate of exchange
between pesos and dollars was Ps. 2.10 for US$1. This situation
may adversely and significantly impact on the Companys future
financial condition and operational results.
The Company is currently assessing the impacts on its financial
condition associated to the new legal framework, including the
effects of the devaluation occurred subsequent to the end of the
year, the need for a tariff renegotiation and the negotiations
with third parties. As a result of the changes above, and their
impact on TGSs audited financial statements, TGS has requested
from the Argentine CNV and the Buenos Aires Stock Exchange an
extension of time for the filing of its annual financial
statements as of December 31, 2001. Consequently, the information
contained in this press release only refers to the results of its
operations for the fourth quarter and year ended December 31,
2001. Once the Company concludes the assessment process mentioned
above, TGS Board of Directors will approve the financial
statements for the year ended December 31, 2001.
FOURTH QUARTER ENDED DECEMBER 31, 2001 VS. 2000
Net revenues for the fourth quarter of 2001 decreased by 21.0% to
Ps. 95.0 million, reflecting lower gas transportation revenues.
This segment reported net revenues of Ps. 67.3 million, which
compares to Ps. 96.7 million for the same quarter of 2000. As a
result of the changes in the economic and regulatory environment,
the Companys Board of Directors decided to reverse the US PPI
adjustments accrued to its revenues during the first nine months
of 2001, which amounted to approximately Ps. 30 million. This
effect was partially mitigated by a rise in average gas
transportation contracted capacity, which increased from 58.1
million cubic meters per day (MMm/d) (2.0 billion cubic feet
per day (Bcf/d)) for the fourth quarter of 2000, to 61.7 MMm/d
(2.2 Bcf/d) during the current quarter. Such increase in the
Companys firm contracted capacity is primarily due to a major
system expansion completed at the beginning of June 2001.
The natural gas liquids (NGL) production and commercialization
segment reported a Ps. 5.1 million net revenue increase,
reflecting the effects of an important business restructuring
through which TGS achieved partial ownership of the Cerri
Complexs production. However, NGL volumes declined as a result
of gas with lower liquid content, arrived at the Cerri Complex
mainly attributable to the start-up of the MEGA project at the
beginning of 2001.
Current quarter cost of sales and administrative and selling
expenses increased by Ps. 11.1 million compared to the same
quarter of last year, mainly due to the following: (i) Ps. 7.0
million in costs incurred to achieve ownership of NGL production,
(ii) an increase of Ps. 1.4 million in amortization and
depreciation expenses, including increased intangible assets
depreciation attributable to new accounting rules issued by
ENARGAS, effective January 1, 2001, and (iii) an increase in
other operational and administrative expenses. Cost of sales and
administrative and selling expenses for the fourth quarter of
2001 reflect the application of the accounting and presentation
rules derived from the ENARGAS resolution passed in early 2000.
For comparative purposes, amounts for the third quarter of 2000
have been presented on the same basis.
Other expenses increased by almost Ps. 16.4 million, basically
reflecting the aforementioned reversal of US PPI adjustments on
gas transportation tariffs recorded during the year 2000, done as
a consequence of changes introduced to the general economic and
regulatory environment, as explained above.
Net interest expense for the fourth quarter of 2001 slightly
increased by Ps. 0.2 million, compared to the same period of last
year. Average outstanding indebtedness increased by 13% as
compared to the same period of last year, incurred mainly to
finance the Companys capital expenditure program. However this
effect was almost completely offset by a decrease in the average
all-in net cost of debt, which fell from 10.1% for the fourth
quarter of 2000 to 8.9% for the current quarter. Reasons for the
decline include, a drop in LIBOR and a successful long-term debt
transaction completed in April 2001.
Income tax expense for the fourth quarter of 2001 decreased Ps.
19.3 million compared to the same quarter of 2000, as a
consequence of lower taxable income attributable to the fourth
quarter 2001 reversal of the US PPI adjustments on gas
transportation tariffs mentioned above.
YEAR-ENDED DECEMBER 31, 2001 VS. 2000
Net revenues for the year ended December 31, 2001 increased by
4.5% to Ps. 501.2 million (see Exhibit II for detailed
information on business segments). Gas transportation segment
revenues totaled Ps. 382.3 million, representing a Ps. 1.8
million decline from Ps. 384.1 obtained in last year. The
decrease is attributable to the reversal of the US PPI
adjustments in 2001, as mentioned above, while 2000 figures
include Ps. 17.5 million related to such adjustments. However,
this effect was somewhat offset by higher average firm contracted
capacity coming from additional gas transportation contracts. As
a result, average firm contracted capacity increased from 57.9
MMm/d (2.0 Bcf/d) during the year ended December 31, 2000, to
60.7 MMm/d (2.1 Bcf/d) for the current year.
The NGL production and commercialization segment reported a Ps.
34.6 million revenue increase for the year ended December 31,
2001, from Ps. 68.3 million earned during last year. Such rise is
principally due to the business restructuring explained above.
However, NGL volumes declined as a result of gas with lower
liquid content arrived at the Cerri Complex mainly attributable
to the start-up of the Compaa MEGA S.A. project at the
beginning of 2001.
Other services revenues for the year 2001 declined by Ps. 11.3
million, mainly as a result of the one time revenue associated
with the construction of a connection pipeline from gas fields
located in the Santa Cruz Province to TGSs main transportation
system, as reported in 2000. This was partially offset by
construction and upstream revenues earned during the current
year.
Cost of sales and administrative and selling expenses during 2001
increased by Ps. 39.1 million as compared to 2000, mainly
reflecting the following: (i) Ps. 35.3 million incurred to
achieve ownership of the NGL production, (ii) an increase of Ps.
8. 7 million in depreciation and amortization expenses, including
new accounting rules applicable to intangible assets issued by
ENARGAS, and (iii) an increase in other operational expenses,
including costs associated to construction services rendered to
third parties. All these effects were partially offset by the Ps.
14.1 million one-time cost associated with the previously
mentioned pipeline construction reported during the previous
year. Cost of sales and administrative and selling expenses for
the year ended December 31, 2001 reflect the application of the
new accounting and presentation rules derived from the ENARGAS
resolution passed in early 2000. For comparative purposes,
amounts for the same period of 2000 have been presented on the
same basis.
Other expenses increased by almost Ps. 15.3 million, basically
reflecting the reversal of US PPI adjustments on gas trans
portation tariffs recorded during the year 2000 as explained
above. This effect was partially mitigated by a one-time
adjustment of differences in payments of provincial taxes
recorded in 2000.
Net interest expense during 2001 decreased by Ps. 6.8 million as
compared to the last year. This decrease was basically due to
lower all-in net cost of debt, which dropped from 10.13 % for the
full year 2000 to 9.31% during 2001. In addition, the Company
increased its interest capitalization as a result of higher
capital expenditures incurred during fiscal year 2001. Both
increases were partially offset by a 5% increase in the Companys
average net indebtedness.
Income tax expense for fiscal year 2001 decreased by Ps. 8.2
million as compared to 2000, basically as a result of a lower
taxable income associated with the reversal of the US PPI
adjustments mentioned above. This impact was somewhat offset by a
slight increase in the 2001 effective tax rate.
TGS, with a current delivery capacity of approximately 62.5
MMm/d or 2.2 Bcf/d is Argentinas leading transporter of natural
gas. The Company is also Argentinas leading processor of natural
gas and one of the largest marketers of natural gas liquids. TGS
is quoted on both the New York and Buenos Aires stock exchanges
under the ticker symbols TGS and TGSU2, respectively. TGSs
controlling shareholder is Compaa de Inversiones de Energa
S.A. ("CIESA"), which together with Pecom Energa S.A. (formerly
Perez Companc S.A.) and a subsidiary and Enron Corp.
subsidiaries, hold approximately 70% of the Companys common
stock. CIESA is currently owned 50% by Pecom Energa S.A. and a
subsidiary, and 50% by subsidiaries of Enron Corp.
CONTACTS: IN BUENOS AIRES
Investor Relations:
Eduardo Pawluszek, Finance & Investor Relations Manager
Gonzalo Castro Olivera, Investor Relations
(gonzalo_olivera@tgs.com.ar)
Mara Victoria Quade, Investor Relations
(victoria_quade@tgs.com.ar)
Tel: (54-11) 4865-9077
Media Relations:
Rafael Rodriguez Roda
Tel: (54-11) 4865-9050 ext. 1238
IN NEW YORK
Alex Cancio, Manager
(alex.cancio@tfn.com)
Mariana Crespo, Associate Director
(mariana.crespo@tfn.com)
THOMSON FINANCIAL /CARSON
Tel: (212) 701-1973
=============
B E R M U D A
=============
GLOBAL CROSSING: Court Postpones Hearing On Objections To Bid
-------------------------------------------------------------
A bankruptcy court hearing on Global Crossings creditors
objections to the US$750 million bid made by Hutchison Whampoa
and Singapore Technologies Telemedia for the companys assets has
been postponed from Thursday to March 13.
According to an article in the USA Today, the postponement
follows a negotiation between the creditors and Globals primary
bidders, which may bring in higher offers for the beleaguered
company.
Creditors are reportedly seeking approval from Hutchison Whampoa
and Singapore Technologies Telemedia to extend the April 23
deadline by which bids for Global Crossing must be submitted to
the bankruptcy court overseeing Global's reorganization. In
addition, they are also seeking a reduction in the US$40 million
breakup fee included in the Asian firms offer. Creditors say the
large fee discourages other offers.
Creditors such as Fleet National Bank and J.P. Morgan Chase
consider the bid by Asian firms Hutchison and Singapore
Technologies as insufficient, saying, it leaves creditors too
little. The creditors are looking to sell Globals assets at the
best price possible in order to recover more of the money they
are owed.
For Hutchison-Singapore, agreeing to the creditors' wishes now
might help build goodwill if they ultimately wish to buy Global
since it will require support from the creditors to win court
approval for a reorganization plan. Moreover, Hutchison also
would have the opportunity to match or top any competing bid.
CONTACTS: GLOBAL CROSSING
Press Contacts:
Dan Coulter
+1 973-410-5810
Daniel.Coulter@globalcrossing.com
Becky Yeamans
+1 973-410-5857
Rebecca.Yeamans@globalcrossing.com
Analysts/Investors Contact:
Ken Simril
+1 310-385-5200
investors@globalcrossing.com
GLOBAL CROSSING: Los Angeles-based Firm To Make Offer Next Week
---------------------------------------------------------------
Tom Gores, founder and chief executive of Los Angeles-based
Platinum Equity, confirmed the buyout firm will make a bid,
probably next week, for Global Crossings assets, says AP.
According to Platinum Equity officials, Global Crossing's almost-
completed 100,000-mile fiber-optic network, which links 27
countries, would fit well with one of Platinum's recent
acquisitions, NextiraOne, which manages voice and data networks.
Platinum Equity's bid will likely include a larger cash injection
than the $750 million offered by Hutchison Whampoa and Singapore
Technologies, said Gores, without giving further details.
The firm's offer is also likely to compete with a bid expected by
next week from Gores Technology Group, a buyout specialist
operated by Gores' brother Alec.
Gores Technology Group, also of Los Angeles, is preparing a bid
with substantially greater value than what creditors would get
from the $750 million rescue offer.
Platinum Equity hopes to sway creditors by convincing them that
NextiraOne has a customer base of 500,000 that will make a
profitable companion to Global Crossing's 100,000 customers.
GLOBAL CROSSING: Sues XO For Cutting Off Network Access
-------------------------------------------------------
Bankrupt broadband provider Global Crossing, Inc. filed a suit
against XO Communications, Inc. after it terminated Global's
access to its network amid an escalating dispute between the two
firms.
The suit claims Reston, Va.-based XO, which itself is facing a
possible bankruptcy, was retaliating for a February 28 decision
by Global Crossing to deny services to XO for nonpayment of a
US$632,165 delinquent bill.
XO was using the Global Crossing network to provide services to
the broadband carrier's customers where the XO had no service of
its own. Global Crossing, in turn, used the XO network to provide
service in areas where the Global Crossing network did not
extend. Global Crossing says it has 120 U.S. customers that use
the XO network.
The suit seeks to have a New York bankruptcy judge order XO to
immediately restore the service. If services are not restored
quickly, the dispute could further spook Global Crossing
customers and undermine efforts to resuscitate the ailing
telecommunications company.
With nearly US$12 billion in debt, Global Crossing filed for
Chapter 11 bankruptcy on Jan. 28 in the country's fourth largest
insolvency case.
XO, on the other hand, has also said it may file for bankruptcy
to force its debtholders to accept a restructuring deal that
would give Telefonos de Mexico and Forstmann Little 39 percent of
the troubled company for US$800 million. The deal would leave
XO's stockholders with virtually worthless stock.
CONTACT: XO COMMUNICATIONS (Reston)
Media:
Todd Wolfenbarger, 703/547-2011
703/675-3496 portable
or
Investor:
Lisa Miles, 703/547-2440
===========
B R A Z I L
===========
TELEMAR: Higher-Than-Expected 2002 Debt Outlook Weighs On Shares
----------------------------------------------------------------
Rio de Janeiro-based operator Tele Norte Leste Participacoes SA
(Telemar) saw its shares fall 5.5 percent, to BRL32.07 in trading
of 66.3 million shares, on concern over swelling debt levels for
this year, reveal analysts and investors in a Bloomberg report.
Telemar, Brazil's largest phone company, explained that the
increase in debt comes mainly from payments to suppliers and
other spending carried over from 2001 into this year.
The guidance for 2002 net debt surprised the market, said
Susana Salaru, a telecommunications analyst at Banco Brascan in
Sao Paulo. The Company should have given more proper warning
about the carry over of investments from 2001 and into this
year.
Analysts expect about BRL1.5 billion in spending booked in 2001,
such as the payment of BRL610 million for the final installment
of Telemar's wireless license, will take place in 2002. The
operator may also spend more than anticipated on its wireless
business, analysts said, as the cost to deploy the mobile network
and marketing spending rise.
The increase in Telemars debt prompted analysts, who are
covering Telemar, to cut the Companys stock or reduce the price
target on its shares.
UBS Warburg analyst Stephen Graham slashed his price target for
Telemar's U.S. traded shares to US$14 from US$16 per share, while
J.P. Morgan Chase & Co.'s Jose Linares downgraded the stock to
market perform from buy.
Telemar's liabilities aren't increasing, insisted Alvaro dos
Santos, chief financial officer at Telemar. The Company has had
some investments that will be carried over from last year and
into this year and that may have confused some analysts.
VARIG: To Sell 20% Stake To Raise Capital
-----------------------------------------
Viacao Aerea Rio-Grandense SA (Varig), Brazil's largest airline,
plans to raise capital by selling new shares representing a 20
percent stake, says a Valor Economico newspaper report.
However, Varigs controlling shareholder, FRB-PAR Investimentos
Ltda., a holding company for the Fundacao Ruben Berta Foundation,
is set to relinquish Friday its right to buy the stock in a
future round of fund-raising expected to happen by June. The
Ruben Berta Foundation, which owns 87 percent of Varig's voting
shares, said it has no more cash to pump into the airline.
We are being realistic. There is no way the foundation can put
more money in the firm, said Yutaka Imagawa, Varig's executive
vice president.
The foundations decision paves way for local or foreign
companies to gain bigger stakes or even control of Varig, the
leading airline in Latin America's largest country.
Imagawa said Varig will seek to boost its capital by June by
issuing shares or debentures, and the foundation is open to
taking Brazilian or foreign partners.
It will depend on the opportunities that arise, he said.
Struggling with a debt of at least US$800 million and a loss of
US$260 million in the first nine months of 2001 despite an
aggressive cost-cutting drive, Varig has long been in talks with
potential partners.
The group is also considering the sale of some of its units, like
Varig Log, a logistics business, or VEM, its maintenance
subsidiary. The company would even welcome offers for more
profitable units, like its Rio Sul subsidiary.
Everything is possible, Imagawa said. We are just looking at
proposals.
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
GE EQUITY
120 Long Ridge Rd.
Stamford, CT 06927
Phone: 203-357-3100
Fax: 203-357-3657
Home Page: http://www.geequity.com
Contacts:
Joseph Parsons, President & CEO
John L. Flannery, Jr., Managing Director
VARIG: Gripen Signs MoU With VEM-Varig
--------------------------------------
Gripen International has signed a Memorandum of Understanding
(MoU) with VEM-VARIG Engineering and Maintenance, reports AFX.
Gripen International, a joint venture between Saab AB and British
Aerospace PLC, is bidding to supply its Gripen supersonic multi-
role fighter to Brazil.
The terms of the MoU stipulate that the parties have agreed that
in the event that Gripen International is awarded the contract to
supply Gripen fighter aircraft to the Brazilian Air Force, they
will evaluate potential projects in the areas of logistics
support and the transfer of technology as part of the program of
industrial cooperation required under the government's tender
process.
=========
C H I L E
=========
TELEX-CHILE: Redes Opticas Announces Cash Tender Offer For Stock
----------------------------------------------------------------
In an official announcement, Redes Opticas (Cayman) Corp. ("Redes
Cayman") and Redes Opticas S.A. ("Redes") disclosed Wednesday
that they will commence concurrent partial tender offers in the
United States and Chile on Thursday, March 7, 2002, for 28.69% of
the outstanding "Class A" shares and 28.69% of the outstanding
"Class B" shares (including American Depositary Shares (the
"ADSs")), totaling 65,392,249 shares, of Telex-Chile S.A. (the
"Shares").
Redes Cayman will be making the tender offer in the United States
(the "U.S. Offer") for Shares held by U.S. holders and for the
ADSs and Redes, the parent and sole shareholder of Redes Cayman,
will be making a concurrent tender offer in Chile (the "Chilean
Offer") for Shares but not the ADSs.
The U.S. Offer will expire at 5:00 pm, New York City time, on
April 5, 2002, and the Chilean Offer will expire at midnight,
Santiago time, on April 5, 2002, unless the U.S. and the Chilean
Offers (the "Offers") are otherwise extended. Redes Cayman is
offering Ch$18 per Share and Ch$180 per ADS, payable, in each
case, in U.S. dollars. Redes Opticas S.A. is offering Ch$18 per
Share, payable in Chilean pesos. The Offers are subject to
certain conditions including, among other things, that at least
65,392,249 Shares or 28.69% of the outstanding Shares including
Shares represented by the ADSs are validly tendered and not
withdrawn prior to the expiration of the Offers. The Offers are
not conditioned upon financing. Only 28.69% of the outstanding
Shares, including Shares represented by the ADSs, equal to an
aggregate of 65,392,249 Shares, will be purchased in the Offers.
If more than 28.69% of the Class A Shares and/or more than 28.69%
of the Class B Shares are tendered in the Offers, a single
proration factor will be determined for each class of Shares: one
for the Class A Shares and one for the Class B Shares (including
Class B Shares underlying the ADSs), to determine the number of
Class A and Class B Shares to be accepted in the Offers. By way
of example, if the number of Shares of one class tendered exceeds
the amount sought (i.e., the class is oversubscribed) and the
other class is undersubscribed, then all Shares tendered in the
undersubscribed class will first be accepted for purchase in the
Offers, and any remaining capacity will be reallocated to the
oversubscribed class and proration will then be applied to the
extent necessary. In addition, if both classes of Shares tendered
are oversubscribed, proration will be applied using one proration
factor for each class, without reallocation, based on the number
of Shares tendered and the number of Shares sought for each
class. If proration is necessary, persons tendering in the U.S.
Offer will be treated identically to persons tendering in the
Chilean Offer. A more complete description of how proration will
work in the Offers will be included in the offer to purchase for
the U.S. Offer and the prospectus for the Chilean Offer. The U.S.
Offer will be open to all holders of ADSs and to all holders of
Shares who are U.S. holders. Non-U.S. holders of Shares must
tender their Shares into the Chilean Offer. U.S. holders of
Shares may tender their Shares into either the U.S. Offer or the
Chilean Offer, but the same Shares may not be simultaneously
tendered into both Offers.
Redes Cayman is a newly incorporated Cayman Islands company and a
wholly owned subsidiary of Redes. Redes is a newly formed
company, organized under the laws of The Republic of Chile, and
an indirect majority owned subsidiary of Southern Cross Latin
America Private Equity Fund, L.P. (together with its affiliates,
"Southern Cross"). GE Capital Equity Investments Ltd. ("GE
Equity") is the indirect minority shareholder of Redes.
Currently, Southern Cross beneficially owns, directly or
indirectly, approximately 36.5% of the outstanding shares of
Telex-Chile's common stock, as a result of certain agreements
entered into with other Telex-Chile shareholders.
In connection with the Offers, Southern Cross and, in certain
cases, GE Equity have entered into agreements with other
stockholders which include "lock-ups" or agreements to tender
Class A Shares into the Chilean Offer. Some of these agreements
also relate to the purchase by Redes of outstanding debt
securities of Telex-Chile that will be converted into Class A
Shares subsequent to the Offers in connection with an increase in
the capital stock of Telex-Chile which was previously approved at
an extraordinary shareholders meeting on January 30, 2002. As a
result of the capital increase and the conversion of the debt
into Class A Shares, shareholders of Telex-Chile who do not
tender in the Offers and/or exercise their preemptive rights in
the capital increase will experience significant dilution in
their ownership of Telex-Chile. Preemptive rights will not be
available to U.S. holders of ADSs. More detailed information
regarding these agreements, the capital increase and the
preemptive rights are included in the Amended Schedule 13D filed
by Southern Cross on February 25, 2002 and will be included in
the offer to purchase for the U.S. Offer.
The Bank of New York is the depositary agent for the U.S. Offer
and MacKenzie Partners, Inc. is the information agent. MacKenzie
Partners, Inc. may be contacted for questions or assistance
regarding the U.S. Offer at, toll free, (800) 322-2885, or in
writing at 105 Madison Avenue, New York, New York 10016.
Additional Information
The description contained herein is neither an offer to purchase
nor a solicitation of an offer to sell shares or ADSs of Telex-
Chile S.A. At the time the Offers are commenced, Redes Cayman
will file a Tender Offer Statement (including an offer to
purchase, a related letter of transmittal, form of acceptance and
other offer documents) with the U.S. Securities and Exchange
Commission ("SEC"). The Tender Offer Statement will contain
important information that should be read carefully before any
decision is made with respect to the Offers. The offer to
purchase, the related letter of transmittal, the form of
acceptance and certain other documents will be mailed to all U.S.
record holders of Shares and ADSs promptly following the
commencement of the Offers and will be made available to all
shareholders of Telex-Chile S.A., at no expense to them. The
Tender Offer Statement will also be available free of charge at
the SEC's public reference room located at 450 Fifth Street,
N.W., Washington, DC 20549.
Southern Cross Latin America Private Equity Fund, L.P., is a
Cayman Islands partnership created in 1998 with the purpose of
making direct, control investments in companies located in Latin
America.
Telex-Chile S.A. is a Chilean telecommunications holding company
principally engaged, through its subsidiaries, in the provision
of long distance services within Chile as well as in other
selected Latin American countries and the United States. It is
one of the leading facilities-based providers of public long
distance services within Chile through Chilesat S.A., its long
distance carrier and principal subsidiary.
CONTACT: MacKenzie Partners, Inc.
800-322-2885
TELEX-CHILE
Rinconada El Salto 202,
Huechuraba
Santiago, Chile
Phone: +56-2-380-0171
Fax: +56-2-382-5142
Toll Free: 1-800-379-9110
E-mail: tlchile@chilesat.net
Home Page: http://www.telex.cl
Contacts:
Juan Eduardo Ibanez, Chairman
Fernando Poch, CEO
Daska Radic, Vice Chairman
Rafael Wilhelm, CFO
===============
C O L O M B I A
===============
SEVEN SEAS: YE01 Reserves Stable, NPV Down With Oil Prices
----------------------------------------------------------
Seven Seas Petroleum Inc. (Amex: SEV) announced today that Ryder
Scott Company Petroleum Consultants has estimated the Company's
net proved oil reserves and the pre-tax net present value of its
proved oil reserves as of December 31, 2001.
-- Net Proved Reserves -- As of December 31, 2001, Seven Seas'
total net proved oil reserves were 47.6 million barrels of oil,
as compared to 48.0 million as of December 31, 2000. All of
these reserves are attributable to the Company's interest in the
Guaduas Oil Field.
-- Net Present Value -- Based on SEC guidelines, the pre-tax net
present value of the Company's proved oil reserves as of December
31, 2001 (discounted at 10%) was $272.3 million, a decrease of 31
percent from $394.1 million as of December 31, 2000.
The decrease in the pre-tax net present value is due principally
to a 26 percent reduction in the price of oil on December 31,
2001 versus the price on December 31, 2000.
Ryder Scott also estimated that the remaining gross proved
reserves of the Guaduas Oil Field as of December 31, 2001 were
153.8 million barrels of oil compared to 155.9 million barrels of
oil as of December 31, 2000. This reduction in net proved oil
reserves is primarily the result of the production of 2 million
barrels of oil in 2001. As of today, the Guaduas Oil Field has
produced over 3.8 million barrels of oil.
Seven Seas also announced that effective March 1, 2002, American
Stock Transfer & Trust Company (AST) of New York City has been
appointed transfer agency and registrar for the Company's common
stock. AST's contact information follows:
American Stock Transfer & Trust Company
59 Maiden Lane
New York, NY 10038
Telephone: (800) 937-5449
Seven Seas Petroleum Inc. is an independent oil and gas
exploration and production company operating in Colombia, South
America. The Company's primary emphasis is on the development and
production of the Guaduas Oil Field and exploration of the
Subthrust Dindal Prospect, both of which are located in
Colombia's prolific Magdalena Basin.
CONTACT: SEVEN SEAS PETROLEUM INC.
Bryan Sanchez, Investor Relations
+1-713-622-8218
===========
M E X I C O
===========
BANCA QUADRUM: Liquidation To Cost IPAB MXN977 Mln
--------------------------------------------------
IPAB executive secretary Julio Cesar Mendez says liquidating
intervened Mexican bank Banca Quadrum will cost Bank Savings
Protection Institute IPAB MXN977 million (US$108 million).
However, the deposit insurance agency doesn't have enough funds
to cover the cost of the Quadrum liquidation. As a result, IPAB
will use part of its MXN3.5-billion reserve to cover the cost of
the liquidation, Mendez said, adding the liquidation will not
cost Mexican taxpayers.
Mendez also noted that the MXN977 million is an estimate because
the bank's assets have to be evaluated and sold off before the
final price-tag of the liquidation can be known.
Mendez called upon Quadrum's 907 clients to come forward and make
their claims within the 60-day period provided for by law.
IPAB was tasked to liquidate Banca Quadrum after the bank's
shareholders failed to find a new partner, nor inject the much-
needed MXN850 million (US$93.5 million) into the ailing bank.
IPAB has designated the consultancy KPMG as representative to
liquidate Banca Quadrum.
To see Banca Quadrum's financial statements:
http://bankrupt.com/misc/Bancaquadrum.doc
CONTACTS: BANCA QUADRUM
Ernesto Rodriguez, Investor Relations
Tel. +011-52-55-5284-5693
Email: erodrigu@quadrum.com.mx
KPMG - Ciudad de Mexico
Bosque de Duraznos Nm. 55
Bosques de las Lomas
11700 Mexico, D.F.
Tel.: +(55) 5246 83 00
Fax.: +(55) 5596 80 60
Contacts:
Guillermo Garcia-Naranjo, General Director
Phone: +(55) 52 46 8320
Email: garcia.guillermo@kpmg.com.mx
GRUPO ALFA: Shares Up As US Tariff Hike Exempts Mexico
------------------------------------------------------
Shares of Grupo Alfa rose 4.93 percent to MXN14.25 per share as
analysts viewed the United States' decision to exempt Mexico from
new steel tariffs as being positive for the Company and the
sector, reports Reuters.
The United States on Tuesday imposed tariffs of up to 30 percent
on a range of steel imports to aid its limping domestic industry,
opening the door to a steel trade war.
It is obviously positive for Mexican companies as they will
enjoy higher relative prices in their market and keep competition
out of their region, said Jorge Beristain, analyst at Deutsche
Banc Alex. Brown in New York.
For companies like Hylsamex, this buys them more time to
continue with their restructuring, he added.
Mexican steel producer Hylsamex, a unit of Alfa, is in the midst
of talks with banks to restructure nearly $650 million in debt as
its business reels from the impact of the economic recession and
slumping world steel prices.
Hylsamex's creditor banks include Banamex-Citibank, BBVA
Bancomer, Bayerische Hypo-Vereins Bank and JP Morgan Chase.
Shares of Hylsamex rose 1.93 percent to MXN5.69 per share.
CREDITOR BANKS: BAYERISCHE HYPO- UND VEREINSBANK AG
Am Tucherpark 14
D-80538 Mnchen
Aktion,rs-Hotline*: 00800 - 378 000 00
(*kostenfrei und nur aus D, A, CH)
Tel: +49 (89) 3 78 - 2 52 76
Fax: +49 (89) 3 78 - 2 40 83
Email: ir@hvbgroup.com
http://www.hypovereinsbank.de
Contacts:
Christian Becker-Hussong
Phone: +49 (89) 3 78 - 2 82 35
Email: Christian.Becker-Hussong@hvbgroup.com
Susan Eckenberg
Phone: +49 (89) 3 78 - 2 91 85
Email: Susan.Eckenberg@hvbgroup.com
JP MORGAN CHASE
60 Wall Street
New York, NY 10260
Phone: (212) 483-2323/648-5545
http://www.jpmorgan.com
BBVA BANCOMER
Av. Universidad 1200,
Col. Xoco, M,xico, D.F.
Phone: (52) (55) 5621-7912
http://www.bancomer.com.mx/
Contacts:
David S nchez-Tembleque
Tel: (52) (55) 5621-4938
Email:investor.relations@bbva.bancomer.com
Jos, de Jesos G>mez Dorantes
Tel: (52) (55) 5621-4718
Araceli Espinosa Elguea
Tel: (52) (55) 5621-2718
GRUPO MEXICO: Asarco Faces Penalties Over Environmental Issues
--------------------------------------------------------------
Asarco, one of the world's leading producers of copper and other
metals, will face penalties if it fails to complete the clean up
of arsenic- and lead- contaminated sediments near the Tacoma
copper smelter it operated for nearly a century, and in the
nearby Yacht Basin in Commencement Bay, says AP.
The order, which was issued by the Environmental Protection
Agency (EPA), came after 18 months of negotiations between the
agency and the financially strapped company ended in January
without an agreement on how the latter would proceed with its
cleanup obligations.
"Before we issued this order, we spent a year and a half
hammering out an agreement with Asarco on the scope and schedule
of the sediment cleanup," said Michelle Pirzadeh of the EPA's
Superfund office. "This order formally lays out the requirements
to get the sediment work done. Keeping the Tacoma cleanup going
is a high priority for us."
Asarco, which shut down the smelter 17 years ago, is liable for
about US$60 million in projected cleanup costs at the smelter
site and the surrounding Ruston and North Tacoma neighborhoods,
the EPA said.
Asarco has spent about US$180 million cleaning up lead, arsenic
and other toxins from the soil, air and water around its Tacoma
smelter.
The AP relates that company officials have said they're committed
to finishing the job, but Asarco's financial troubles are raising
serious doubts about how the cleanup can be finished on time.
Asarco has more than US$450 million in outstanding loans. The
company is in default because its assets are US$84 million short
of the collateral needed to cover them. Negotiations are ongoing
with a consortium of 20 U.S., Canadian and European banks to
restructure the loans.
Grupo Mexico, the world's largest mining company, which bought
Asarco in 1999, has also seen a decline in its earnings. The
companys operating earnings in the fourth quarter of 2001 were
down 125 percent compared to the same period a year ago, and down
64 percent for the just-completed fiscal year.
The companys debt load of US$2.5 billion is partly the result of
its acquisition of Asarco. It has sought to control costs by
suspending operations at Asarco smelters in Helena, Montana, and
El Paso, Texas.
Financial analysts predict that any future financial
restructuring would likely involve Southern Peru Copper, which
owns two of the richest copper mines in the world. Asarco holds a
54-percent interest in that company -one of its most valuable
remaining assets.
Grupo Mexico could sell its interest in Southern Peru Copper, or
move to strip it from Asarco and place it elsewhere in the
corporate structure.
"Would Grupo Mexico risk its reputation by walking away from
Asarco?" said Anita Saha, an analyst with Fitch Ratings in
Chicago. "It could make it hard for Grupo Mexico to tap
international financial markets for refinancing in the future."
CONTACTS: GRUPO MEXICO S.A. DE C.V
Avenida Baja California 200,
Colonia Roma Sur
06760 Mexico, D.F.
Mexico
Phone: +52-55-5264-7775
Fax: +52-55-5264-7769
http://www.gmexico.com
Contacts:
German Larrea Mota-Velasco, Chairman & CEO
Xavier Garcia de Quevedo Topete, President & COO
SOUTHERN PERU COPPER CORPORATION
Ave. Caminos del Inca 171
Urb. Chacarilla del Estanque
Santiago de Surco
Lima 33, Peru
Tel: +51 1 372 1414
Fax: +51 1 372 0238
Home Page: http://www.southernperu.com
Contacts:
German Larrea Mota-Velasco, Chairman & CEO
Oscar Gonzalez Rocha, President & Director General
Daniel Tellechea Salido, VP - Finance
ASARCO, INC.
2575 E. Camelback Rd., Ste. 500
Phoenix, AZ 85016
Phone: 602-977-6500
Fax: 602-977-6701
Home Page: http://www.asarco.com
Contacts:
German Larea Mota-Velasco, Chairman & CEO
Genaro Larrea Mota-Velasco, President
Daniel Tellechea Salido, VP & CFO
GRUPO MEXICO: Workers Lodge Strike To Protest Wage Proposal
-----------------------------------------------------------
Mining activities at Grupo Mexicos La Caridad copper mine in the
northeastern state of Sonora, San Martin Sombrerete zinc mine in
north central Zacatecas state and Unidad Pasta de Conchos zinc
mine in northern Coahuila state were crippled after close to
3,000 workers lodged a strike to protest the Company's 5 percent
wage-hike proposal. Workers are seeking an average salary hike of
between 8 and 10 percent.
This is a complicated fight that has different points of view,
said Consuelo Aguilar, a spokeswoman for the National Mining and
Metallurgic Union of the Mexican Republic.
The strike is another setback for the Mexico City-based company,
which is already facing problems meeting its debt payments
because of low copper prices.
On Friday, Standard & Poor's slashed the credit ratings on Grupo
Mexico's three mining units, including its U.S. subsidiary Asarco
Inc. and its Peruvian subsidiary Southern Peru Copper Corp.,
because of declining revenue and delays in reaching an agreement
with its creditors to stretch out debt payments.
The credit rating was lowered to CCC+, seven levels below
investment grade, from BB-, the New York-based rating company
said.
TRI-NATIONAL DEV: Signs Marketing Agreement With Coastal Pacific
----------------------------------------------------------------
In an official company press release, Tri-National Development
Corp. (OTCBB:TNAVQ) announced Wednesday that it has entered into
a sales and marketing agreement with Coastal Pacific Realty for
the sale of residential lots and estate ranchettes within its
Vinas de Bajamar development.
Coastal Pacific Realty has real estate offices located in Bonita,
Calif., and Baja California, Mexico.
Michael A. Sunstein, president and CEO of Tri-National, said, "We
are excited to add yet another top quality real estate sales
organization to our existing sales team for Vinas de Bajamar. Joe
Gutierrez, owner of Coastal Pacific Realty, has an extensive
knowledge of the real estate in this region with over 30 years
experience and strongly believes in our vision for this project."
Vinas de Bajamar is a 1,250-acre master-planned golf and 1,400
home site residential development located approximately 50 miles
south of San Diego on the Pacific Ocean in N. Baja California,
Mexico. Tri-National is currently pre-selling lots in the
development as an integral part of its reorganization plan
starting at $20,000 each with a 10 percent down payment and no
interest financing over 96 months.
Tri-National Development Corp. is an international real estate
development, sales and management company focused on providing
up-scale affordable housing in the Baja region of Mexico and the
Southwestern United States.
This release contains forward-looking statements that involve
risks and uncertainties. The Company's actual results could
differ materially from those anticipated in these forward-looking
statements as a result of various factors.
CONTACT: TRI-NATIONAL DEVELOPMENT CORP., SAN DIEGO
Jason Sunstein, 619/718-6370
Fax: 619/718-6377
Email: jason@tri-national.com
URL: http://tri-national.com
or
COAST PACIFIC REALTY
Joe Gutierrez, 619/656-0430
coastalpr@hotmail.com
=======
P E R U
=======
AEROCONTINENTE: Sues Chilean Government For Causing Losses
----------------------------------------------------------
The Peruvian airline AeroContinente plans to file a US$1-billion
case against the Chilean state, South American Business
Information reports.
AeroContinente blamed Chile for the losses it incurred during an
intervention in the company ordered by the state defense council
due to alleged involvement in money-laundering scam.
The Peruvian airline piled up debts of US$17.1 million and nearly
went bankrupt when operations came to a standstill amid an
inquiry which failed to prove of any allegations.
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U R U G U A Y
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FUNSA: Calls In Receivers Following Sharp Drop On Exports
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Due to a severe drop in its exports, the Uruguayan tire
manufacturing company Fabrica Uruguaya de Neumaticos S.A. (FUNSA)
called in the receivers, reports El Pais.
The Company, which was acquired by the American company Titan in
1998, was producing for the local market only where it has a 20-
percent market share. FUNSA owes US$7 million to suppliers and
another US$12 million to banks.
CONTACTS: FUNSA/TITAN
Cno. Corrals 3076
Montevideo Uruguay)
5070611
5070611
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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 Vao, Editors.
Copyright 2002. All rights reserved. ISSN 1529-2746.
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