/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/020417.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 Wednesday, April 17, 2002, Vol. 3, Issue 75 Headlines A R G E N T I N A ANDERSEN: Local Operations To Merge With Ernst & Young BGN: Credit Suisse Under Fire Over Shady Funds Transfers BHN: Widening Currency Inequity Threatens Structured Deals REPSOL YPF: Concludes US$430M Contract With U.S. Firm B E R M U D A GLOBAL CROSSING: Protests DREN Contract Ruling GLOBAL CROSSING: Applies To Employ Gloster As Special Counsel GLOBAL CROSSING: Seeks Bidding Protections from Court TYCO INTERNATIONAL: Out of Fidelity Magellan's Top 10 Holdings TYCO INTERNATIONAL: Company Profile B R A Z I L BCP: Shareholders' Dispute Concludes With BellSouth Buyout CESP: Rolling Over Debt With International Bond Sale NRG ENERGY: Includes LA in Regional Asset Bundle Sales E C U A D O R BANCO DEL PACIFICO: 1Q02 Staff Cuts Pay Off in Profits M E X I C O GRUPO ICONSA: Considers Bankruptcy Filing to Restructure P A R A G U A Y COPACO: Privatization Model Encounters Resistance V E N E Z U E L A AES CORP.: Shares Plummet On Return Of Venezuelan President - - - - - - - - - - ================= A R G E N T I N A ================= ANDERSEN: Local Operations To Merge With Ernst & Young ------------------------------------------------------ Pistrelli Diaz y Asociados, the Argentine arm of embattled accounting company Andersen, is set to merge its local operations with rival Ernst & Young, according to a spokesman for the local firm in a Reuters report. "The company has decided to merge with Ernst & Young," the spokesman said. "The merger should be definitive (complete) by July." Terms of the deal were not immediately available. The decision follows last week's move by Andersen's Chilean arm to unveil a merger with Ernst & Young. Andersen's operations in Argentina have annual revenues of around ARS100 million (US$33 million). CONTACT: PISTRELLI, DIAZ Y ASOCIADOS (ANDERSEN - BUENOS AIRES) 25 de Mayo 487 1st Floor 1002 Buenos Aires, Argentina Phone: 54 11 4311 6644 54 11 4311 6667 Fax: 54 11 4312 8647 54 11 4318 1600/1777 54 11 4510 2220 E-mail: argentina@andersen.com BGN: Credit Suisse Under Fire Over Shady Funds Transfers -------------------------------------------------------- Credit Suisse is under pressure to assume responsibility for US$280 million that was siphoned out of an Argentine bank into an offshore company in which the Swiss bank has indirect ownership, EFE relates. Credit Suisse chairman Lukas Muhlemann, who sits on the board of Argentina's Banco General de Negocios (BGN), in which Credit Suisse holds a 24 percent stake is yet to respond to creditors' complaints, says EFE. BGN is currently facing an investigation for allegedly skimming off millions and channeling it to a firm called the Compania General de Negocios domiciled in the British Virgin Islands two months ago, when a recession-plagued Argentine government restricted depositors' access to their accounts. Credit Suisse officials have declined to comment on the affair except to state that there is no direct connection between BGN and the Compania General de Negocios. The Compania, they said is owned by a Panamanian-registered firm known as St. Louis Financial and Investment company, in which Credit Suisse's U.S. arm, CS First Boston, holds a 12-percent stake. Uruguayan judges are also investigating the scheme. One of them claims to have established that the former BGN directors control the Panamanian company and thus, operating behind a smokescreen, control the accounts of the Compania General de Negocios. 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 Zurich Tel. +41 (1) 212 16 16 Fax. +41 (1) 333 25 87 Contact: Lukas Muehlemann, chairman & CEO BHN: Widening Currency Inequity Threatens Structured Deals ---------------------------------------------------------- The effects of Latin America's economic slump were felt across numerous Argentine structured finance transactions, leading to a substantial number of downgrades in the first quarter of 2002. By the middle of February, ratings on several transactions were lowered to default status, given the ripple effect of the sovereign default, a freeze on dollar and peso deposits, a high unemployment rate, local currency depreciation, and pesification (the conversion of certain dollar debt into pesos at a one-to-one exchange rate). In the beginning of January 2002, ratings for BHN II Mortgage Trust and BHN III Mortgage Trust were placed on CreditWatch with negative implications. Both transactions have structural features providing investors with protections against payment defaults. "Even though the transactions had shown strong credit performance during the past four years and have benefited from adequate loss coverage break-even levels, they were affected by the deepening recession and the currency devaluation that occurred on Jan. 4," said Juan Pablo De Mollein, an associate director in Standard & Poor's Structured Finance Latin America Ratings group. "This happened because the underlying debtors receive their income in Argentine pesos and have to make their mortgage payments in U.S. dollars." In the following weeks, Standard & Poor's lowered its ratings on 11 Argentine structured transactions whose underlying assets depend on the creditworthiness of related corporate or public finance obligors. By mid-February, the ratings assigned to five globally rated transactions were lowered to 'D'. Because the current economic and financial situation in Argentina is very volatile, Standard & Poor's will continue to actively monitor the transactions it rates. CONTACT: STANDARD & POOR'S (Buenos Aires) Juan Pablo De Mollein, (54) 114-891-2113 REPSOL YPF: Concludes US$430M Contract With U.S. Firm ----------------------------------------------------- Spain's largest petroleum group, Repsol YPF, finalized a US$430- million contract to sell oil over seven years to U.S. company Hydrocarbons Traders Corporation (HTC), reveals Expansion. Facing uncertainties brought about by the severe economic recession in Argentina, Repsol agreed to sell HTC 24.1 million barrels of oil over seven years. The price per barrel in the agreement is in the US$18 neighborhood. With this deal, Repsol YPF has long-term sale agreements for 46 million barrels, at an average price of US$19.48. The operation, according to Expansion, is being carried out via YPF, the Argentine company bought by the Spanish group in 1999. In earnings reports for 2001, Repsol said Argentina's economic problems prompted it to apply write-offs and make extraordinary provisions, including a EUR1.45 billion write-down against reserves, and a provision of EUR1.29 billion against 2001 earnings. CONTACTS: REPSOL YPF Alfonso Cortina De Alcocer, Chairman & CEO Ramon Blanco Balin, Vice Chairman Carmelo De Las Morenas Lopez, CFO Their Address: Paseo de la Castellana 278 28046 Madrid, Spain Phone +34 91 348 81 00 Home Page: http://www.repsol.com or Av. Roque S enz Pe a, 777. C.P 1364. Buenos Aires Argentina ============= B E R M U D A ============= GLOBAL CROSSING: Protests DREN Contract Ruling ---------------------------------------------- Global Crossing announced Monday that it has filed a protest with the U.S. General Accounting Office (GAO) regarding its ruling that Global Crossing would not be considered for award of the Defense Research and Engineering (DREN) contract. On April 4, 2002, Global Crossing received notification from the Defense Information Systems Agency/Defense Information Technology Contracting Organization (DISA/DITCO) that it is 'ineligible for award' due to its current financial situation. The DREN contract was awarded to Global Crossing in July 2001, but was re-bid to address procedural issues after unsuccessful bidders contested the results. "We were originally awarded the contract based on the merits of our technologically superior solution, cost-effectiveness and our experience offering similar services to other large customers," said John Legere, chief executive officer of Global Crossing. "It is our contention that we met all of the stated criteria for demonstrating financial responsibility, and we therefore should have been considered for the contract." On January 28, 2002, certain companies in the Global Crossing Group (excluding Asia Global Crossing and its subsidiaries) commenced Chapter 11 cases in the United States Bankruptcy Court for the Southern District of New York and coordinated proceedings in the Supreme Court of Bermuda. CONTACT: GLOBAL CROSSING Press Contact: Catherine Berthier +1 212-412-4666 Email: Catherine.Berthier@globalcrossing.com Becky Yeamans +1 973-410-5857 Email: Rebecca.Yeamans@globalcrossing.com Analysts/Investors Contact Ken Simril +1 310-385-3838 Email: investors@globalcrossing.com GLOBAL CROSSING: Applies To Employ Gloster As Special Counsel ------------------------------------------------------------- Global Crossing, Ltd. seeks to retain Elizabeth Gloster, Queen's Counsel (QC) as special Bermuda counsel in the Chapter 11 cases, pursuant to Sections 327(e) and 328 of the Bankruptcy Code, and effective as of the Petition Date. According to the application filed with the Court, Ms. Gloster will perform certain legal services necessary during these Chapter 11 cases, and will assist special counsel Appleby Spurling & Kempe in addressing relevant issues arising under Bermuda law and with issues arising pursuant to the coordination of proceedings thereunder. According to Mitchell C. Sussis, the Debtors' Corporate Secretary, Elizabeth Gloster, QC has extensive experience and knowledge in the field of debtors' and creditors' rights and business reorganizations under Bermuda law, as well as in cross- border reorganizations generally. The Debtors' reorganization has involved the filing of a winding-up proceeding and the appointment of provisional liquidators in Bermuda. Coordination of these proceedings with the Debtors' Chapter 11 cases is therefore necessary. In a complex international bankruptcy matter, Mr. Sussis explains that it is not unusual for a debtor in Bermuda to employ both a QC (a senior barrister) and a firm of attorneys in Bermuda to assist in an insolvency matter. A QC works closely with the Bermuda firm of attorneys to provide expert advice on complex issues of law, as and when requested from the Bermuda firm. This process does not involve the duplication of services that are ordinarily provided by the Bermuda firm of attorneys. Mr. Sussis contends that Elizabeth Gloster, QC is well qualified to render these services having extensive experience counseling large corporations with regard to reorganization and restructuring under Bermuda law, cross-border insolvencies generally, and matters of corporate law and governance under English legal systems such as those in Bermuda. The Debtors selected Elizabeth Gloster, QC as special Bermuda counsel based on her special expertise in Bermuda law and the international aspects of the Bermuda restructuring proceedings. Elizabeth Gloster, QC will work closely with the Debtors' other attorneys to ensure that there is no duplication of services performed for or charged to the Debtors' estates. Mr. Sussis tells the Court that the services of Elizabeth Gloster, QC as special Bermuda counsel are necessary to enable the Debtors to address the anticipated host of legal issues arising under Bermuda law, and to coordinate the Debtors' approaches to and strategies for addressing developments in the concurrent proceedings thereunder, quickly and efficiently, thereby assisting with an expeditious exit from Chapter 11. In this way, retention of Elizabeth Gloster, QC will help maximize the value of the Debtors' estates and lead to an enhanced dividend to creditors. Elizabeth Gloster, QC, informs the Court that the Debtors paid her a total of 15,000 pounds for pre-petition services rendered and related expenses. Ms. Gloster will also apply to the U.S. Court for allowance of compensation and reimbursement of expenses in accordance with applicable provisions of the Bankruptcy Code, the Bankruptcy Rules and Orders of this Court. The Debtors propose to pay Elizabeth Gloster, QC her of 600 pounds (approximately $860 today) per hour, subject to periodic adjustments. Ms. Gloster assures the Court that she does not have any interest materially adverse to the interests of the estate. She does not have a direct or indirect relationship to, or interest in, the Debtors except that she has previously rendered services to Sumitomo Trust & Banking Co., KPMG, Arthur Andersen, in matters unrelated these cases. (Global Crossing Bankruptcy News, Issue No. 7, Bankruptcy Creditors' Service, Inc., 609/392-0900) GLOBAL CROSSING: Seeks Bidding Protections from Court ----------------------------------------------------- Judge Gerber sets June 20, 2002, as the deadline for submitting Bids to compete with the deal outlined in the Letter of Intent and term sheet dated January 28, 2002, among Global Crossing Ltd., Hutchison Whampoa Limited and Singapore Technologies Telemedia Pte. Ltd. If Global Crossing receives more than one Qualified Bid on or before the Bid Deadline, the Company will conduct an auction beginning on July 8, 2002, at the offices of Weil, Gotshal & Manges LLP, 767 Fifth Avenue, New York, New York 10153. If an Auction occurs, a hearing will be held before the undersigned United States Bankruptcy Judge on July 11, 2002 in the United States Bankruptcy Court for the Southern District of New York, One Bowling Green, New York, New York 10004. At this time, the Court will consider the Bid selected by Global Crossing, the proponent of such bid, and confirm the results of the Auction. Judge Gerber has authorized the Debtors to pay the documented, reasonable fees, costs and expenses of the Investors in the manner described in the Motion. These costs relate solely to a potential asset purchase or investment transaction with the Debtors, up to a maximum of $5,000,000 in the aggregate from commencement of the Debtors' Chapter 11 cases through the date the Investors and the Debtors execute the Definitive Documentation to the Debtors. Fees, costs, and expenses of the Investors will be submitted, by way of monthly statements, to the Debtors, the United States Trustee for the Southern District of New York, and the attorneys for the Creditors' Committee. If the Investors and the Debtors execute Definitive Documentation that is acceptable to the Banks and the Creditors' Committee on or before May 21, 2002, Judge Gerber rules that the Investors are entitled to receive, and the Debtors are obligated to pay, a termination fee of $30,000,000 in the aggregate. This is provided that the Investors have not terminated their obligation to proceed under the transaction, or breached any obligation contained in the Definitive Documentation. (Global Crossing Bankruptcy News, Issue No. 7, Bankruptcy Creditors' Service, Inc., 609/392-0900) TYCO INTERNATIONAL: Out of Fidelity Magellan's Top 10 Holdings -------------------------------------------------------------- Troubled conglomerate Tyco International Ltd. is no longer in the Fidelity Magellan mutual fund's Top 10 Holdings, according to the latest portfolio data. However, it's still not clear whether Magellan, which is the largest actively managed mutual fund with about US$77.8 billion in assets, sold Tyco stock, or if portfolio manager Robert Stansky held onto the shares and Tyco fell out of the Top 10 because it represents a smaller weighting in the fund now that its stock price has fallen sharply. Tyco, which had been the fund's fourth-largest holding at year end, has seen its shares plummeting 45 percent in the first quarter on concerns about accounting for acquisitions, its earnings outlook and a surprise restructuring plan to split the conglomerate into four companies. Tyco is based in Bermuda but is run from Exeter. TYCO INTERNATIONAL: Company Profile ----------------------------------- NAME: Tyco International Ltd The Zurich Centre, Second Floor 90 Pitts Bay Road Pembroke HM 08, Bermuda Phone: 441-292-8674 TYCO INTERNATIONAL (U.S.) INC. One Tyco Park Exeter, NH 03833 Phone: 603-778-9700 WEB SITE: http://www.tyco.com/ EXECUTIVE MANAGEMENT TEAM: L. Dennis Kozlowski - Chairman, CEO, and Pres Mark Swartz - CFO, Exec. VP, Director Mark Belnick - Exec. VP and Chief Corp. Counsel Joshua Berman - VP, Director TYPE OF BUSINESS: Tyco Int'l, through its subsidiaries, manufactures, designs, and sells electronic components, undersea cable, disposable medical supplies, fire suppression and detection equipment, security systems and flow control products. SIC: GENERAL INDUSTRIAL MACHINERY & EQUIPMENT, NEC [3569] EMPLOYEES: 242,500 (As of April 12, 2002) TOTAL ASSETS: US$115,320.7 million (as of Q ended 12/31/01) TOTAL LIABILITIES: US$80,165.1 million (as of Q ended 12/31/01) NUMBER OF SHARES OUTSTANDING: 1,996.36 million (as of Q ended 12/31/01) =========== B R A Z I L =========== BCP: Shareholders' Dispute Concludes With BellSouth Buyout ---------------------------------------------------------- Tough negotiations between U.S. phone company BellSouth and Brazil's powerful Safra family over their money-losing Brazilian mobile phone subsidiary BCP are about to end with BellSouth taking control of BCP. According to a report released by Reuters, BellSouth would exchange its 34.8 percent stake in Israel's largest mobile phone operator Cellcom Ltd. for the 45 percent of BCP owned by Brazil's powerful Safra family, which is also a shareholder in Cellcom. The deal would leave BellSouth with almost 90 percent of BCP, and Safra would end up with almost 70 percent of Cellcom. In March, BCP defaulted on US$375 million owed to a syndicate of banks due to a disagreement between BellSouth and the Safras over how to handle the Company's debt load. The default accelerated some US$1.6 billion in debt that BellSouth wants to restructure. The Safras, through their holding company Verbier, had wanted to make the payment and then see about renegotiating the debt. BCP's debt problem began at the Company's conception in 1997 when it borrowed to pay a hefty BRL2.6-billion (then US$2.5 billion), for a license to operate mobile services in Sao Paulo, Brazil. The dollar-linked debt load grew heavier in 1999, magnified by a 30 percent-plus devaluation of the Brazilian currency, the real. The real's 16 percent depreciation in 2001 made matters worse despite analysts' belief that the Company is doing well at an operating level. CONTACT: BELLSOUTH CORPORATION 1155 Peachtree St. NE Atlanta, GA 30309-3610 Phone: 404-249-2000 Fax: 404-249-5599 Home Page: http://www.bellsouth.com Contacts: Investor Relations Phone (US): 800.241.3419 Fax: 404.249.2060 E-mail: investor@bellsouth.com BCP TELECOMUNICACOES Rua Florida, 1970 4o andar Sao Paulo - SP Tel: 55 11 5509-6428 Fax: 55 11 5509-6257 Home Page: http://www.bcp.com.br CESP: Rolling Over Debt With International Bond Sale ---------------------------------------------------- Companhia Energetica de Sao Paulo SA (Cesp) is looking to sell US$200 million of unsecured bonds in the international market to roll over debt coming due in June, reports Bloomberg. The Company, which is Brazil's third-largest power generator, hired Westdeutsche Landesbank Girozentrale's Banco Europeo Para America Latina and Portugal's Banco Finantia to manage the sale. Cesp's US$300 million of bonds maturing in 2007 have a put option due on June 26. Recent reports have it that Cesp is also considering selling BRL450 million (US$196 million) in four-year local notes to finish building the Engenheiro Sergio Motta hydroelectric plant. Cesp ended 2001 with net losses of BRL813.3 million, up by 196 percent from the BRL414.3 million recorded in the previous year. Operating cost also ballooned to BRL1.49 billion from BRL739.5 million. Results were partly hurt by the energy-rationing program introduced in June last year to help replenish depleted reservoir levels. In addition, the Company's bottom line was also negatively impacted by its dollar-denominated debt, which totaled BRL6.53 billion at the end of 2001. The energy firm distributes electricity in Brazil's wealthiest state of Sao Paulo. CONTACT: CESP-COMPANHIA ENERGETICA DE SAO PAULO Rua da Consolacao, 1.875 CEP 01301 -100 Sao Paulo, Brazil Phone: +55-11-234-6322 Fax: +55-11-287-0871 Home Page: http://www.cesp.com.br/ Contact: Mauro G. Jardim Arce, Chairman Ruy M. Altenfelder Silva, Vice Chairman Vicente Kazuhiro Okazaki, Finance Director BANCO EUROPEO PARA AMERICA LATINA Street Av. Leandro N. Alem 855 Pisos 30,31, 32 Capital Federal 1001 Buenos Aires Argentina Phone: 011-5776-0000 Fax: 011-5776-0010 BANCO FINANTIA Rua General Firmino Miguel n�5 1600 Lisboa Portugal Phone: (351) 21 720 20 00 Fax: (351) 21 726 53 10 E-mail: finantia@finantia.com Home Page: http://www.finantia.com/ Contacts: Antonio Manuel Afonso Guerreiro, BOD Chairman Xavier Louis Max Dupont, International Strategic Board Pres. Office in Brasil Rua Geraldo Faustino Gomes, 42 Conj. 92, SP 04575 - 060 Sao Paulo Brasil Phone: (55 11) 5505 1027 Fax: (55 11) 5505 0905 NRG ENERGY: Includes LA in Regional Asset Bundle Sales ------------------------------------------------------ NRG Energy, Inc. announced Monday it has retained financial advisors to market its international assets. The assets are being marketed in four regional bundles; Latin America, the United Kingdom, Continental Europe and Asia-Pacific. "Over the last decade, NRG has successfully pursued its strategy of building regional portfolios of assets and now we plan to market these portfolios in order to capture the value created by the regional approach," said David H. Peterson, NRG Energy chairman, president and CEO. "We expect to issue information memoranda in May, and by summer, make a final determination concerning which assets may be sold." NRG is coordinating the sales process, part of NRG's plans to improve liquidity and reduce debt, from its Minneapolis headquarters with NRG management and financial advisors working in each region. NRG has selected Goldman Sachs as its financial advisor for its European and UK portfolios, Deutsche Bank for its Latin American portfolio and ABN-AMRO for its Asia-Pacific portfolio. The Company continues to evaluate restructuring its domestic portfolio including the potential sale of a partial or entire interest in selected North American regions. NRG is also well into the process of selling its ownership in NEO's landfill gas assets. NRG owns power plants fired by coal, natural gas and oil in Australia, Taiwan and India. NRG owns 1,850 megawatts of generation in the Asia-Pacific region. One megawatt is enough power to light 1,000 typical U.S. homes. In Latin America, NRG owns natural gas, hydroelectric, oil, coal and geothermal generators in Brazil, Bolivia and Peru. The company owns natural gas, coal and oil plants in the U.K., Germany, Hungary, the Czech Republic and Poland. NRG is facing a severe cash crunch with a loss of US$29 million in the first two months of the year due to weak power demand stemming from mild weather and subsequent weak energy prices. Xcel, a Minneapolis-based utility, spun off 26 percent of NRG two years ago but now wants to buy it back as part of an overall restructuring plan. Xcel made the decision because NRG was needing constant funding and facing a potential downgrade by credit rating agencies which would have made it even more difficult for NRG to raise capital. CONTACT: NRG Energy, Inc., Minneapolis Media Relations: Lesa Bader, 612/373-6992 or Investor Relations: Len Bluhm, 612/313-8900 DEUTSCHE BANK AG Taunusanlage 12 60262 Frankfurt, Germany Phone: +49-69-910-91000 Fax: +49-69-910-34227 Home Page: http://www.deutsche-bank.de Contact: Public Relations Hanns Michael H�lz, Dr. Ottmar Kayser Taunusanlage 12 D- 60325 Frankfurt am Main E-mail: mailbox.publicaffairs@db.com ============= E C U A D O R ============= BANCO DEL PACIFICO: 1Q02 Staff Cuts Pay Off in Profits ------------------------------------------------------ Interdin & Ahead Advisory, which took over the management of Banco del Pacifico in October 2001, laid off 422 employees during the first three months of 2002, reveals a report by El Universo. The staff cuts were part of a program to sack 800 job positions in the labor force and save US$6 million per month, while keeping a labor force of 1,100 workers. Over the same period, Pacifico posted profits of US$6.7 million, with assets worth of up to US$566 million. Pacifico was intervened and taken over by the government during Ecuador's 1998-1999 financial crisis. The bank was originally scheduled to be sold this year. However, due to this year's elections and the financial crisis in Argentina that had scared off international investors to invest in Latin America, the bank won't be sold until 2003. Interdin took over the bank's management in a bid to make Pacifico more attractive to foreign investors. CONTACTS: BANCO DEL PACIFICO: Ec. Javier S nchez Pulley, Presidente del Directorio Dr. F,lix Herrero Bachmeier, Presidente Ejecutivo P. Ycasa 200 GUAYAQUIL EuroADOR Tel: + 593 566010 Fax: + 593 564636 =========== M E X I C O =========== GRUPO ICONSA: Considers Bankruptcy Filing to Restructure -------------------------------------------------------- Mexican engineering and construction concern Grupo Iconsa (Ingenieros Y Contratistas S.A. De C.V.) revealed it is reviewing its options and may file for bankruptcy, according to a Dow Jones News report. Iconsa, in a filing with the Mexican bourse, announced it would initiate negotiations with creditors and suppliers to restructure liabilities the moment it obtains protection under the new bankruptcy law. In 2001, Iconsa recorded a MXN159.6-million ($1=MXN9.1620) net loss on sales of MXN748.9 million. The Company's total liabilities stood at MXN675.9 million. CONTACT: Grupo Iconsa SA Calle Tres No. 53 Naucalpan de Ju rez Edo. de M�xico. C.P. 5356 Phone: 52 5576-67-55 Fax: 52 53-58-74-75 Email: grupo_iconsa@iconsa.com.mx Contact: Andres Conesa Ruiz, Chairman of the Board INVESTOR RELATIONS: Andres Conesa Ruiz Phone: 21-22-80-00 Fax: 53-58-74-75 =============== P A R A G U A Y =============== COPACO: Privatization Model Encounters Resistance ------------------------------------------------- Privatization of the Paraguayan telecom Copaco is running into some complications from the country's industrialists. The group, who are associated with the Feprinco federation, expressed opposition to the privatization model, relates South American Business Information. The industrialists are condemning the process on beliefs that the process is just an excuse to pass on to a private company the monopoly prior held by the government. According to studies done earlier by the consulting company Strategic Policy Research's model of the privatization, the telecom commission Conatel didn't stress the risk of a continuing monopoly. Making matters worse are a series of irregular procedures reportedly made during the initial steps in Copaco's privatization process. Copaco is scheduled for privatization April 30 with a base price of US$400 million, of which US$195 million will go to the Treasury. The remaining balance would be used to reinforce the Company's cash flow. ================= V E N E Z U E L A ================= AES CORP.: Shares Plummet On Return Of Venezuelan President ----------------------------------------------------------- Shares of U.S. power producer AES Corp. plunged as much as 14 percent in Monday midday trading amid investor concern over unrest in Venezuela. AES owns electric utility CA Electricidad de Caracas in the region, analysts said in a Bloomberg report. The stock, according to the report, dropped US$1.10 to US$7.40, the lowest level in almost six weeks. The shares have plunged 85 percent throughout the past year. Early this week, Venezuelan President Hugo Chavez regained power following his ouster Friday after supporters stormed the presidential palace and several army battalions proclaimed their support. "As a result of Chavez coming back, the likelihood of civil unrest is higher," said Andre Meade, an analyst with Commerzbank Capital Markets. "With the unrest comes a lot of uncertainty for investors," adds Meade, who rates the stock "hold" and doesn't own its shares. On February 15, AES fell 26 percent on concern the Company might face a cash crunch following a currency devaluation in Venezuela. The stock plummeted 32 percent in the next session after the Company said it planned to sell as much as US$1.5 billion in assets and trim spending by 41 percent after losses in Latin America. Last month, AES sold its shares in CA Nacional Telefonos de Venezuela (CANTV) for US$91.5 million, five months after it abandoned a US$1.44 billion takeover bid for Venezuela's largest telephone company. CONTACTS: AES Corporation Kenneth R. Woodcock Roger W. Sant, Chairman Dennis W. Bakke, President, CEO, and Director Barry J. Sharp, EVP Large Utilities, CFO, and COO THEIR ADDRESS: AES Corp. 1001 N. 19th St. Arlington, VA 22209 Phone: 703-522-1315 Fax: 703-528-4510 URL: http://www.aesc.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 Ma. Cristina Canson, 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. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR Latin America subscription rate is $575 per half-year, delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Christopher Beard at 240/629-3300. * * * End of Transmission * * *